<PAGE>
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(PURSUANT TO SECTION 13(E)(1) OF THE SECURITIES EXCHANGE ACT OF 1934)
----------------
ATLANTIC CITY ELECTRIC COMPANY
(NAME OF ISSUER)
CONECTIV
(NAME OF PERSON(S) FILING STATEMENT)
<TABLE>
<S> <C>
TITLE CUSIP NUMBER
----- ------------
Atlantic City Electric Company,
Cumulative Preferred Stock, Par Value $100
4% Series 048303200 and 048303903
4.10% Series 048303770
4.35% Series 048303762
4.35% 2nd Series 048303507
4.75% Series 048303309
5% Series 048303788
</TABLE>
(TITLE OF CLASS OF SECURITIES)
(CUSIP NUMBER OF CLASS OF SECURITIES)
PETER F. CLARK, ESQ., GENERAL COUNSEL
CONECTIV
800 KING STREET
P.O. BOX 231
WILMINGTON, DELAWARE 19899
(302) 429-3448
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES
AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
THE COMMISSION IS REQUESTED TO MAIL SIGNED COPIES OF ALL ORDERS, NOTICES AND
COMMUNICATIONS TO:
STEPHANIE M. SCOLA VINCENT PAGANO, JR., ESQ.
MANAGER OF CAPITAL MARKETS SIMPSON THACHER & BARTLETT
CONECTIV 425 LEXINGTON AVENUE
800 KING STREET NEW YORK, NEW YORK 10017
WILMINGTON, DELAWARE 19899
SEPTEMBER 10, 1998
(DATE TENDER OFFER FIRST PUBLISHED,
SENT OR GIVEN TO SECURITY HOLDERS)
CALCULATION OF FILING FEE
<TABLE>
<S> <C>
TRANSACTION VALUATION* AMOUNT OF FILING FEE
---------------------- --------------------
$26,651,300 $5,331
</TABLE>
- --------
* Solely for purposes of calculating the filing fee and computed pursuant to
Section 13(e)(3) of the Securities Exchange Act of 1934, as amended, and Rule
0-11(b)(1) thereunder, the transaction value equals the total amount of
funds, excluding fees and other expenses, required to purchase all
outstanding shares of each series of securities listed above pursuant to the
Offer described in the Offer to Purchase and Proxy Statement filed as an
Exhibit hereto.
[_] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form or
Schedule and date of its filing.
Amount Previously Paid:Not applicable
Form or Registration No.:Not applicable
Filing Party:Not applicable
Date Filed:Not applicable
- -------------------------------------------------------------------------------
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<PAGE>
ITEM 1. SECURITY AND ISSUER
(a) Atlantic City Electric Company, a New Jersey corporation (the
"Company"), is the issuer. The Company's principal executive office is at 800
King Street, P.O. Box 231, Wilmington, Delaware 19899.
(b) Incorporated herein by reference to the information appearing on the
front cover of the Offer to Purchase and Proxy Statement, dated September 10,
1998, filed as Exhibit 99(a)(1) to this Issuer Tender Offer Statement on
Schedule 13E-4 (the "Offer to Purchase and Proxy Statement"), and to the
information appearing under the captions "Terms of the Offer--Number of
Shares; Purchase Prices; Expiration Date" and "Transactions and Agreement
Concerning the Shares" in the Offer to Purchase and Proxy Statement.
(c) Incorporated herein by reference to the information appearing under the
caption "Price Range of Shares; Dividends" in the Offer to Purchase and Proxy
Statement.
(d) Conectiv, a Delaware corporation ("Conectiv"), is the person filing this
Statement and is the owner of 100% of the common stock of the Company.
Conectiv's principal office is at 800 King Street, P.O. Box 231, Wilmington,
Delaware 19899.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
(a)-(b) Incorporated herein by reference to the information appearing under
the caption "Source and Amount of Funds" in the Offer to Purchase and Proxy
Statement.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE
Incorporated herein by reference to the information appearing under the
caption "Purpose of the Offer; Certain Effects of the Offer" in the Offer to
Purchase and Proxy Statement.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER
Incorporated herein by reference to the information appearing under the
caption "Transactions and Agreements Concerning the Shares" in the Offer to
Purchase and Proxy Statement.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE ISSUER'S SECURITIES
Incorporated herein by reference to the information appearing under the
caption "Transactions and Agreements Concerning Shares" in the Offer to
Purchase and Proxy Statement.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
Incorporated herein by reference to the information appearing under the
caption "Fees and Expenses Paid to Dealers" in the Offer to Purchase and Proxy
Statement.
ITEM 7. FINANCIAL INFORMATION
(a) Incorporated herein by reference to the financial statements included in
the Annual Report on Form 10-K for the year ended December 31, 1997 of the
Company, to the financial statements included in the Quarterly Reports on Form
10-Q for the quarters ended March 31, 1998 and June 30, 1998 of the Company
and the information appearing under the caption "Summary of Financial
Information" in the Offer to Purchase and Proxy Statement.
(b) Not applicable.
2
<PAGE>
ITEM 8. ADDITIONAL INFORMATION
(a) Not applicable.
(b) Incorporated herein by reference to the information appearing under the
caption "Terms of the Offer--Certain Conditions of the Offer" in the Offer to
Purchase and Proxy Statement.
(c) Not applicable.
(d) Not applicable.
(e) See Exhibits 99(a)(1) and 99(a)(2).
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
99(a)(1) Offer to Purchase and Proxy Statement, dated September 10, 1998.
99(a)(2) Letter of Transmittal and Proxy for each series of securities.
99(a)(3) Notice of Guaranteed Delivery and Proxy.
Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
99(a)(4) other Nominees.
Letter to Clients of Brokers, Dealers, Commercial Banks, Trust
99(a)(5) Companies and other Nominees.
99(a)(6) Advertisement, dated September 11, 1998.
99(a)(7) Letter to Shareholders, dated September 10, 1998.
99(a)(8) Press Release, dated September 10, 1998.
Guidelines for Certification of Taxpayer Identification Number on
99(a)(9) Substitute Form W-9.
99(a)(10) Summary Simplified Instructions.
99(a)(11) Form of Follow-up Notice to Shareholders.
99(a)(12) Summary DTC Participant Proxy Form.
99(b) Not applicable.
99(c) Not applicable.
99(d) Tax Opinion of Simpson Thacher & Bartlett.
99(e) Not applicable.
99(f) Not applicable.
</TABLE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Date: September 10, 1998
CONECTIV
Louis M. Walters
By: _________________________________
Louis M. Walters
Treasurer
<PAGE>
EXHIBIT INDEX
<TABLE>
<C> <S>
99(a)(1) Offer to Purchase and Proxy Statement, dated September 10, 1998.
99(a)(2) Letter of Transmittal and Proxy for each series of securities.
99(a)(3) Notice of Guaranteed Delivery and Proxy.
Letter of Brokers, Dealers, Commercial Banks, Trust Companies and
99(a)(4) other Nominees.
Letter to Clients of Brokers, Dealers, Commercial Banks, Trust
99(a)(5) Companies and other Nominees.
99(a)(6) Advertisement, dated September 11, 1998.
99(a)(7) Letter to Shareholders, dated September 10, 1998.
99(a)(8) Press Release, dated September 10, 1998.
Guidelines for Certification of Taxpayer Identification Number on
99(a)(9) Substitute Form W-9.
99(a)(10) Summary Simplified Instructions.
99(a)(11) Form of Follow-up Notice to Shareholders.
99(a)(12) Summary DTC Participant Proxy Form.
99(b) Not applicable.
99(c) Not applicable.
99(d) Tax Opinion of Simpson Thacher & Bartlett.
99(e) Not applicable.
99(f) Not applicable.
</TABLE>
<PAGE>
EXHIBIT 99(a)(1)
OFFER TO PURCHASE AND PROXY STATEMENT
CONECTIV
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING SERIES OF
CUMULATIVE PREFERRED STOCK, PAR VALUE $100, OF
ATLANTIC CITY ELECTRIC COMPANY
77,000 SHARES, 4% SERIES, CUSIP NUMBERS 048303200 AND 048303903, AT A PURCHASE
PRICE OF $81.60 PER SHARE
72,000 SHARES, 4.10% SERIES, CUSIP NUMBER 048303770, AT A PURCHASE PRICE OF
$83.50 PER SHARE
15,000 SHARES, 4.35% SERIES, CUSIP NUMBER 048303762, AT A PURCHASE PRICE OF
$88.60 PER SHARE,
36,000 SHARES, 4.35% 2ND SERIES, CUSIP NUMBER 048303507, AT A PURCHASE PRICE
OF $88.60 PER SHARE
50,000 SHARES, 4.75% SERIES, CUSIP NUMBER 048303309, AT A PURCHASE PRICE OF
$96.75 PER SHARE
50,000 SHARES, 5% SERIES CUSIP NUMBER 048303788, AT A PURCHASE PRICE OF
$100.00 PER SHARE
ATLANTIC CITY ELECTRIC COMPANY
PROXY STATEMENT WITH RESPECT TO ITS COMMON STOCK AND PREFERRED STOCK
-------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED.
-------------
Conectiv, a Delaware corporation ("Conectiv"), invites the holders of the 4%
Series, the 4.10% Series, the 4.35% Series, the 4.35% 2nd Series, the 4.75%
Series and the 5% Series of preferred stock listed above (each a "Series of
Preferred," and the holder thereof a "Preferred Shareholder") of Atlantic City
Electric Company, a New Jersey corporation and direct utility subsidiary of
Conectiv (the "Company"), to tender any and all of their shares of a Series of
Preferred ("Shares") for purchase at the purchase price per Share listed
above, net to the seller in cash, upon the terms and subject to the conditions
set forth in this Offer to Purchase and Proxy Statement and in the
accompanying Letter of Transmittal and Proxy (which together constitute the
"Offer"). Conectiv will purchase any and all Shares validly tendered and not
withdrawn, upon the terms and subject to the conditions of the Offer. See
"Terms of the Offer--Certain Conditions of the Offer" and "Terms of the
Offer--Extension of Tender Period; Termination; Amendments."
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. PREFERRED SHAREHOLDERS
(INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES SUBSEQUENT TO THE RECORD
DATE (AS HEREINAFTER DEFINED) AND WHO FOLLOW THE REQUIRED PROCEDURES
APPLICABLE TO SUCH SHARES) WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE
OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT, AS DESCRIBED BELOW. THE
OFFER IS CONDITIONED UPON THE APPROVAL OF THE SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") UNDER THE PUBLIC UTILITY HOLDING COMPANY ACT OF
1935, AS AMENDED (THE "HOLDING COMPANY ACT"), AND UPON, AMONG OTHER THINGS,
THE PROPOSED AMENDMENT, AS DESCRIBED BELOW, BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING (AS DEFINED BELOW) (UNLESS WAIVED BY CONECTIV). SEE "TERMS OF
THE OFFER--CERTAIN CONDITIONS OF THE OFFER."
IN ORDER TO VALIDLY TENDER SHARES PURSUANT TO THE OFFER, PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES DURING THE PERIOD BEGINNING TWO BUSINESS DAYS
PRIOR TO THE RECORD DATE AND UP TO AND INCLUDING THE EXPIRATION DATE (AS
HEREINAFTER DEFINED) MUST OBTAIN AN ASSIGNMENT OF PROXY FROM THE SELLER OF
SUCH SHARES AND VOTE SUCH PROXY IN FAVOR OF THE PROPOSED AMENDMENT. IN ORDER
TO FACILITATE THE TRANSFER OF SHARES DURING THE PERIOD DESCRIBED ABOVE, THE
SHARES OF EACH SERIES OF PREFERRED WILL TRADE "WITH PROXY" IN THE OVER-THE-
COUNTER MARKET. SETTLEMENT OF ALL TRADES DURING THE PERIOD DESCRIBED ABOVE
SHOULD INCLUDE AN ASSIGNMENT OF PROXY FROM THE SELLER. SEE "TERMS OF THE
OFFER--PROCEDURE FOR TENDERING SHARES." FOR FURTHER INFORMATION, CALL THE
INFORMATION AGENT (AS HEREINAFTER DEFINED) OR THE DEALER MANAGER (AS
HEREINAFTER DEFINED) OR CONSULT YOUR BROKER FOR ASSISTANCE.
CONCURRENTLY WITH THE OFFER, THE BOARD OF DIRECTORS OF THE COMPANY IS
SOLICITING PROXIES FROM THE HOLDERS OF THE COMPANY'S OUTSTANDING PREFERRED
STOCK (WHICH, IN ADDITION TO EACH SERIES OF PREFERRED INCLUDED IN THIS OFFER,
CONSISTS OF THE COMPANY'S $7.80 NO PAR PREFERRED STOCK) FOR USE AT THE SPECIAL
MEETING OF SHAREHOLDERS OF THE COMPANY TO BE HELD AT CHRISTIANA CONFERENCE
CENTER, 4100 SOUTH WAKEFIELD DRIVE, NEWARK, DELAWARE, ON OCTOBER 14, 1998 AT
4:00 P.M., EASTERN TIME, OR ANY ADJOURNMENT OR POSTPONEMENT OF SUCH MEETING
(THE "SPECIAL MEETING"). THE SPECIAL MEETING, NOTICE OF WHICH IS HEREBY GIVEN,
IS BEING HELD TO CONSIDER AN AMENDMENT (THE "PROPOSED AMENDMENT") TO THE
COMPANY'S CHARTER (THE "CHARTER") WHICH WOULD ELIMINATE THE PROVISION IN THE
CHARTER RESTRICTING THE ABILITY OF THE COMPANY TO ISSUE UNSECURED
INDEBTEDNESS. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE AND WHO FOLLOW THE REQUIRED
PROCEDURES APPLICABLE TO SUCH SHARES) WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER MUST SUBMIT A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE IN FAVOR OF THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING LETTER OF TRANSMITTAL AND PROXY THEIR INTENTION TO VOTE FOR THE
PROPOSED AMENDMENT AT THE SPECIAL MEETING. HOWEVER, PREFERRED SHAREHOLDERS WHO
POSSESS THE PROXY WITH RESPECT TO SUCH SHARES HAVE THE RIGHT TO VOTE FOR THE
PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED BY THE COMPANY'S SHAREHOLDERS, THE
COMPANY WILL MAKE A SPECIAL CASH PAYMENT ("SPECIAL CASH PAYMENT") IN THE
AMOUNT EQUAL TO $1.00 PER SHARE FOR EACH SHARE PROPERLY VOTED IN FAVOR OF THE
PROPOSED AMENDMENT, PROVIDED THAT SUCH SHARES HAVE NOT BEEN TENDERED PURSUANT
TO THE OFFER. THOSE PREFERRED SHAREHOLDERS WHO VALIDLY TENDER THEIR SHARES
WILL BE ENTITLED ONLY TO THE PURCHASE PRICE PER SHARE LISTED ABOVE. TENDERING
PREFERRED SHAREHOLDERS WILL NOT BE ENTITLED TO THE SPECIAL CASH PAYMENT.
-------------
THE COMPANY WILL PAY A SOLICITATION FEE FOR SHARES TENDERED, ACCEPTED FOR
PAYMENT AND PAID FOR PURSUANT TO THE OFFER, SUBJECT TO CERTAIN CONDITIONS.
SEE "FEES AND EXPENSES PAID TO DEALERS."
-------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
FAIRNESS OR MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY
OR ADEQUACY OF THE INFORMATION CONTAINED IN THIS
DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
-------------
NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR ANY
OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED
SHAREHOLDER AS TO WHETHER TO TENDER ANY OR ALL SHARES. EACH PREFERRED
SHAREHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER
SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
THE COMPANY'S BOARD OF DIRECTORS RECOMMENDS VOTING FOR THE PROPOSED
AMENDMENT.
-------------
This Offer to Purchase and Proxy Statement is first being mailed on or about
September 10, 1998. The record date with respect to the Shares is September
14, 1998.
-------------
Each Series of Preferred is traded in the over-the-counter market (the
"OTC") and is not listed on any national securities exchange. On September 3,
1998, the last reported sale price as reported by the National Quotation
Bureau, LLC was $69.57 for the 4% Series (on August 20, 1998), $63.00 for the
4.35% Series (on April 21, 1998), $81.625 for the 4.75% Series (on July 31,
1998) and $87.00 for the 5% Series (on August 26, 1998). There were no sales
prices available for the 4.10% Series and the 4.35% 2nd Series. Preferred
Shareholders are urged to obtain a current market quotation for the Shares.
-------------
The Dealer Manager for the Offer is:
MORGAN STANLEY DEAN WITTER
September 10, 1998
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF
CONECTIV OR THE COMPANY AS TO WHETHER PREFERRED SHAREHOLDERS SHOULD TENDER OR
REFRAIN FROM TENDERING SHARES OF ANY SERIES OF PREFERRED PURSUANT TO THE
OFFER. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN
OR IN THE RELATED LETTER OF TRANSMITTAL AND PROXY. IF GIVEN OR MADE, SUCH
RECOMMENDATION AND SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY CONECTIV OR THE COMPANY.
IMPORTANT
Any Preferred Shareholder desiring to accept the Offer and tender all or any
portion of his or her Shares should, in addition to voting in favor of the
Proposed Amendment either by executing and returning the enclosed Letter of
Transmittal and Proxy or by voting in person by ballot at the Special Meeting,
either (i) if not the record holder, request his or her broker, dealer,
commercial bank, trust company or nominee to effect the transaction for him or
her, or (ii) if the record holder, complete and sign the Letter of Transmittal
and Proxy, in accordance with the instructions in such Letter of Transmittal
and Proxy, mail or deliver the same and any other required documents to The
Bank of New York (the "Depositary"), and deliver the certificates for such
Shares to the Depositary, along with the Letter of Transmittal and Proxy, or
tender such Shares pursuant to the procedure for book-entry transfer set forth
below under "Terms of the Offer -- Procedure for Tendering Shares," on or
prior to the Expiration Date (as defined below). A Preferred Shareholder whose
Shares are registered in the name of a broker, dealer, commercial bank, trust
company or nominee must contact such broker, dealer, commercial bank, trust
company or nominee if he or she desires to tender such Shares. Any Preferred
Shareholder who desires to tender Shares and whose certificates for such
Shares are not immediately available, or who cannot comply in a timely manner
with the procedure for book-entry transfer, should tender such Shares by
following the procedures for guaranteed delivery set forth below under "Terms
of the Offer -- Procedure for Tendering Shares."
EACH SERIES OF PREFERRED HAS ITS OWN LETTER OF TRANSMITTAL AND PROXY, AND
ONLY THE APPLICABLE LETTER OF TRANSMITTAL AND PROXY FOR SUCH TENDERED SERIES
OF PREFERRED OR A NOTICE OF GUARANTEED DELIVERY AND PROXY MAY BE USED TO
TENDER SHARES OF SUCH SERIES OF PREFERRED. A LETTER OF TRANSMITTAL AND PROXY
MAY BE USED TO VOTE IN FAVOR OF THE PROPOSED AMENDMENT EVEN IF NO SHARES ARE
BEING TENDERED.
Questions or requests for assistance may be directed to D.F. King & Co.,
Inc. (the "Information Agent") or to Morgan Stanley & Co. Incorporated
("Morgan Stanley" or the "Dealer Manager") at their respective telephone
numbers and addresses set forth on the back cover of this Offer to Purchase
and Proxy Statement. Requests for additional copies of this Offer to Purchase
and Proxy Statement, the applicable Letter of Transmittal and Proxy or other
tender offer or proxy materials may be directed to the Information Agent, and
such copies will be furnished promptly at the Company's expense. Preferred
Shareholders may also contact their local broker, dealer, commercial bank or
trust company for assistance concerning the Offer.
i
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Summary................................................................... 1
Terms of the Offer........................................................ 4
Number of Shares, Purchase Prices; Expiration Date; Dividends........... 4
Procedure for Tendering Shares.......................................... 5
Withdrawal Rights....................................................... 8
Acceptance of Shares for Payment and Payment of Purchase Price and
Dividends.............................................................. 8
Certain Conditions of the Offer......................................... 9
Extension of Tender Period; Termination; Amendments..................... 11
Proposed Amendment and Proxy Solicitation................................. 12
Introduction............................................................ 12
Voting Shares........................................................... 12
Voting Requirements and Procedures...................................... 12
Proxies................................................................. 13
Special Cash Payments................................................... 14
Security Ownership of Certain Beneficial Owners and Management.......... 14
Business to Come Before the Special Meeting............................. 14
Explanation of the Proposed Amendment................................... 15
Reasons for the Proposed Amendment...................................... 15
Price Range Of Shares; Dividends.......................................... 16
Purpose of the Offer; Certain Effects of the Offer........................ 17
Certain Federal Income Tax Consequences................................... 19
Source and Amount of Funds................................................ 21
Transactions and Agreements Concerning the Shares......................... 21
Fees and Expenses Paid to Dealers......................................... 22
Certain Information Regarding Conectiv and the Company.................... 23
Summary of Financial Information.......................................... 24
Miscellaneous............................................................. 25
</TABLE>
ii
<PAGE>
SUMMARY
The following summary is provided solely for the convenience of the Preferred
Shareholders. This summary is not intended to be complete and is qualified in
its entirety by reference to the full text and more specific details contained
in this Offer to Purchase and Proxy Statement and the Letter of Transmittal and
Proxy and any amendments or supplements hereto or thereto. Preferred
Shareholders are urged to read this Offer to Purchase and Proxy Statement and
the Letter of Transmittal and Proxy in their entirety. Each of the capitalized
terms used in this summary and not defined herein has the meaning set forth
elsewhere in this Offer to Purchase and Proxy Statement.
Conectiv and the Company.... Conectiv, 800 King Street, Wilmington, Delaware
19899, is a registered holding company under the
Holding Company Act and owns all of the
outstanding common stock of its electric utility
subsidiaries, including the Company. The service
area of Conectiv's electric utility subsidiaries
covers portions of Delaware, Maryland, New Jersey
and Virginia and, on an unregulated basis,
portions of Pennsylvania. The Company, 800 King
Street, Wilmington, Delaware 19899, is a utility
primarily engaged in the generation,
transmission, distribution and sale of electric
power to approximately 480,000 customers in the
southern part of New Jersey.
The Series of Preferred 4% Preferred Stock (par value $100 per share)
Stock...................... 4.10% Preferred Stock (par value $100 per share)
4.35% Preferred Stock (par value $100 per share)
4.35% 2nd Series Preferred Stock (par value $100
per share)
4.75% Preferred Stock (par value $100 per share)
5% Preferred Stock (par value $100 per share)
The Offer and Purchase Offer to purchase any or all Shares of each
Price....................... Series of Preferred at the price set forth below.
$81.60 per 4% Share
$83.50 per 4.10% Share
$88.60 per 4.35% Share
$88.60 per 4.35% 2nd Series Share
$96.75 per 4.75% Share
$100.00 per 5% Share
Dividends................... The Board of Directors of the Company will
consider the declaration of dividends on the
Company's capital stock at its meeting on
September 24, 1998. The Regular Quarterly
Dividend on the Company's preferred stock, if,
when and as declared, will be paid on November 2,
1998 to holders of record as of the close of
business on October 2, 1998. A holder of record
of Shares on October 2, 1998 who tenders Shares
will be entitled to the Regular Quarterly
Dividend, regardless of when such tender is made.
Holders of Shares purchased pursuant to the Offer
will not be entitled to any dividends in respect
of any later dividend periods.
Independent Offer........... The Offer for one Series of Preferred is
independent of the Offer for any other Series of
Preferred. The Offer is not conditioned upon any
minimum number of Shares of the respective Series
of Preferred being tendered. Preferred
Shareholders who wish to tender their
1
<PAGE>
Shares must vote in favor of the Proposed
Amendment. The Offer is subject to shareholder
approval of the Proposed Amendment and certain
other conditions.
Commission Approval......... The Offer is conditioned, among other things,
upon the approval of the Commission under the
Holding Company Act.
Expiration Date of the The Offer expires at 5:00 p.m., New York City
Offer...................... time, on October 14, 1998, unless extended (the
"Expiration Date").
How to Tender Shares........ Preferred Shareholders (including Preferred
Shareholders who acquire Shares subsequent to the
Record Date) who wish to tender their Shares must
vote in favor of the Proposed Amendment.
Preferred Shareholders who purchase or whose
purchase is registered after the Record Date and
who wish to tender their Shares must arrange with
their seller to receive an assignment of proxy
from the holder of record on the Record Date. See
"Terms of the Offer -- Procedure for Tendering
Shares." For further information, call the
Information Agent or the Dealer Manager or
consult your broker for assistance.
Withdrawal Rights........... Tendered Shares of any Series of Preferred may be
withdrawn at any time until the Expiration Date
with respect to such Series of Preferred and,
unless previously accepted for payment, may also
be withdrawn after November 5, 1998. See "Terms
of the Offer --Withdrawal Rights." The proxy
accompanying any tendered Shares that are
withdrawn will not be considered revoked unless
the Preferred Shareholder specifically revokes
such proxy as described herein. See "Proposed
Amendment and Proxy Solicitation -- Proxies."
Purpose of the Offer........ Conectiv is making the Offer because Conectiv
believes that the purchase of Shares will provide
financial flexibility beneficial to the Company
and indirectly to Conectiv and its shareholders.
In addition, the Offer gives Preferred
Shareholders the opportunity to sell their Shares
at a price which Conectiv believes to be a
premium over the market price and without the
usual transaction costs associated with a market
sale. See "Purpose of the Offer; Certain Effects
of the Offer."
Brokerage Commissions....... Not payable by Preferred Shareholders.
Solicitation Fee............ Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are
tendered, accepted for payment and paid for
pursuant to the Offer (except that for
transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares,
Conectiv will pay a solicitation fee of an amount
equal to $1.00 per Share). A Soliciting Dealer
(as defined herein) will not be entitled to a
solicitation fee for Shares beneficially owned by
such Soliciting Dealer. See "Fees and Expenses
Paid to Dealers."
2
<PAGE>
Proposed Amendment.......... Concurrently with the Offer, the Board of
Directors of the Company is soliciting proxies
from all holders of each series of the Company's
outstanding preferred stock for use at the
Special Meeting of Shareholders of the Company.
The Special Meeting is being held to consider an
amendment to the Company's Charter which would
eliminate the provision restricting the ability
of the Company to issue unsecured indebtedness.
If the Proposed Amendment is approved by the
shareholders, such restriction contained in the
Charter will be eliminated with respect to any
Shares that remain outstanding after the
consummation of the Offer. In the event that the
Proposed Amendment is not approved by the
required two-thirds of the shares of the
preferred stock but a majority of the shares of
the preferred stock are tendered pursuant to the
Offer, Conectiv may elect to waive the condition
to the Offer that requires approval of the
Proposed Amendment and purchase such shares.
Conectiv has not determined whether it will make
such an election, but if it were to do so, as
holder of a majority of the shares of the
preferred stock, Conectiv would hold a sufficient
number of shares to permit it to consent as a
Preferred Shareholder to the issuance of
unsecured indebtedness pursuant to the Charter in
excess of the limits set forth therein. Without
the prior consent of the Securities and Exchange
Commission, Conectiv will be required to sell its
Shares to the Company on or prior to December 31,
2000. See "Purpose of the Offer; Certain Effects
of the Offer."
Record Date with respect to
the Shares................. September 14, 1998.
Special Cash Payment........ Preferred Shareholders who possess the proxy with
respect to Shares have the right to vote for the
Proposed Amendment regardless of whether they
tender their Shares. If the Proposed Amendment is
approved and adopted by the Company's
shareholders, the Company will make a special
cash payment equal to $ 1.00 per Share for each
Share properly voted in favor of the Proposed
Amendment but not tendered (the "Special Cash
Payment"). Preferred Shareholders who validly
tender their Shares will not be entitled to the
Special Cash Payment. Rather, such tendering
Preferred Shareholders will only be entitled to
the purchase price per Share listed on the front
cover of this Offer to Purchase and Proxy
Statement.
Stock Transfer Tax.......... Except as described herein, Conectiv will pay or
cause to be paid any stock transfer taxes with
respect to the sale and transfer of any Shares to
it or its order pursuant to the Offer. See
Instruction 6 of the applicable Letter of
Transmittal and Proxy. See "Terms of the Offer --
Acceptance of Shares for Payment of Purchase
Price and Dividends."
Payment Date................ Promptly after the Expiration Date or any
extension thereof (the "Payment Date").
Further Information......... Additional copies of this Offer to Purchase and
Proxy Statement and the applicable Letter of
Transmittal and Proxy may be obtained by
contacting D.F. King & Co., Inc., the Information
Agent, at (800) 431-9629 (toll free) and (212)
269-5550 (banks and brokers). Questions about the
Offer should be directed to Morgan Stanley at
(800) 624-1808 (toll free).
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TERMS OF THE OFFER
NUMBER OF SHARES, PURCHASE PRICES; EXPIRATION DATE; DIVIDENDS
Upon the terms and subject to the conditions described herein and in the
applicable Letter of Transmittal and Proxy, Conectiv will purchase any and all
Shares that are validly tendered on or prior to the applicable Expiration Date
(and not properly withdrawn in accordance with "Terms of the Offer--Withdrawal
Rights") at the purchase price per Share listed on the front cover of this
Offer to Purchase and Proxy Statement for the Shares tendered, net to the
seller in cash. See "Terms of the Offer--Certain Conditions of the Offer" and
"Terms of the Offer--Extension of Tender Period; Termination." On September 4,
1998, there were issued and outstanding 77,000 shares of the 4% Series; 72,000
shares of the 4.10% Series; 15,000 shares of the 4.35% Series; 36,000 shares
of the 4.35% 2nd Series; 50,000 shares of the 4.75% Series and 50,000 shares
of the 5% Series.
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. THE OFFER, HOWEVER, IS
CONDITIONED UPON, AMONG OTHER THINGS, THE PROPOSED AMENDMENT BEING APPROVED
AND ADOPTED AT THE SPECIAL MEETING (UNLESS WAIVED BY CONECTIV). PREFERRED
SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES SUBSEQUENT
TO THE RECORD DATE AND WHO FOLLOW THE REQUIRED PROCEDURES APPLICABLE TO SUCH
SHARES) WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER MUST VOTE IN
FAVOR OF THE PROPOSED AMENDMENT, AS DESCRIBED HEREIN. THE OFFER IS SUBJECT TO
CERTAIN OTHER CONDITIONS. SEE "TERMS OF THE OFFER--CERTAIN CONDITIONS OF THE
OFFER."
The Offer is being sent to all persons in whose names Shares are registered
on the books of the Company as of the close of business on September 14, 1998
and transferees of such persons. Preferred Shareholders who purchase or whose
purchase is registered after the Record Date and who wish to tender in the
Offer must arrange with their seller to receive a proxy from the holder of
record on the Record Date. In order to facilitate receipt of proxies, Shares
traded in the over-the-counter market only shall, during the period which
commences September 10, 1998 (two business days prior to the Record Date) and
which will end at the close of business on the Expiration Date, trade with a
proxy providing the transferee with the right to vote such acquired Shares in
the proxy solicitation. No record date is fixed for determining which persons
are permitted to tender Shares. However, only the holders of record, or
holders who acquire an assignment of proxy from such holders, are permitted to
vote for the Proposed Amendment and thereby validly tender Shares pursuant to
the Offer. As such, any person who is the beneficial owner but not the record
holder of the Shares must (i) arrange for the record transfer of Shares prior
to tendering or (ii) direct such record holder to tender the Shares and vote
in favor of the Proposed Amendment on behalf of such beneficial owner.
With respect to each Series of Preferred, the Expiration Date is the later
of 5:00 p.m., New York City time, on October 14, 1998 or the latest time and
date to which the Offer with respect to such Series of Preferred is extended.
Conectiv expressly reserves the right, in its sole discretion, and at any time
and/or from time to time, to extend the period of time during which the Offer
for any Series of Preferred is open, by giving oral or written notice of such
extension to the Depositary and making a public announcement thereof, without
extending the period of time during which the Offer for any other Series of
Preferred is open. There is no assurance whatsoever that Conectiv will
exercise its right to extend the Offer for any Series of Preferred. If
Conectiv decides, in its sole discretion, to (i) decrease the number of Shares
of any Series of Preferred being sought, (ii) increase or decrease the
consideration offered in the Offer to holders of any Series of Preferred or
(iii) increase or decrease the Soliciting Dealers' fees and, at the time that
notice of such increase or decrease is first published, sent or given to
holders of such Series of Preferred in the manner specified herein, the Offer
for such Series of Preferred is scheduled to expire at any time earlier than
the tenth business day from the date that such notice is first so published,
sent or given, such Offer will be extended until the expiration of such ten-
business-day period. For
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<PAGE>
purposes of the Offer, a "business day" means any day other than a Saturday,
Sunday or federal holiday and consists of the time period from 12:00 midnight
through 11:59 p.m., New York City time.
NO ALTERNATIVE, CONDITIONAL OR CONTINGENT TENDERS WILL BE ACCEPTED AND NO
TENDERS WILL BE ACCEPTED IN RESPECT OF SHARES FOR WHICH A VOTE IN FAVOR OF THE
PROPOSED AMENDMENT HAS NOT BEEN CAST AT THE SPECIAL MEETING. SUCH VOTE MAY BE
CAST BY PROPERLY COMPLETING THE FORM OF PROXY THAT IS A PART OF THE APPLICABLE
LETTER OF TRANSMITTAL AND PROXY OR BY VOTING IN PERSON BY BALLOT AT THE
SPECIAL MEETING.
The Board of Directors of the Company (the "Board") will consider the
declaration of dividends on the Company's capital stock at its September 24,
1998 meeting. The regular quarterly dividend on the Company's preferred stock
(the "Regular Quarterly Dividend"), if, when and as declared, will be paid on
November 2, 1998 to holders of record as of the close of business on October
2, 1998. A holder of record of Shares on October 2, 1998 who tenders Shares
will be entitled to the Regular Quarterly Dividend, regardless of when such
tender is made. Holders of Shares purchased pursuant to the Offer will not be
entitled to any dividends in respect of any later dividend periods.
PROCEDURE FOR TENDERING SHARES
To tender Shares pursuant to the Offer, the tendering owner of Shares must
either:
(a) send to the Depositary (at one of its addresses set forth on the back
cover of this Offer to Purchase and Proxy Statement) a properly completed
and duly executed Letter of Transmittal and Proxy (which will either
deliver such owner's proxy or indicate such owner's intention to vote at
the Special Meeting in person by ballot), together with any required
signature guarantees and any other documents required by the Letter of
Transmittal and Proxy, and either (i) certificates for the Shares to be
tendered must be received by the Depositary at one of such addresses or
(ii) such Shares must be delivered pursuant to the procedures for book-
entry transfer described herein (and a confirmation of such delivery must
be received by the Depositary), in each case by the Expiration Date; or
(b) comply with the guaranteed delivery procedure described under
"Guaranteed Delivery Procedure" below.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder service department ("ACE
Stockholder Services") at (800) 365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
IN ORDER TO VALIDLY TENDER SHARES PURSUANT TO THE OFFER, PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES DURING THE PERIOD BEGINNING TWO BUSINESS DAYS
PRIOR TO THE RECORD DATE AND UP TO AND INCLUDING THE EXPIRATION DATE MUST
OBTAIN AN ASSIGNMENT OF PROXY FROM THE SELLER OF SUCH SHARES AND VOTE SUCH
PROXY IN FAVOR OF THE PROPOSED AMENDMENT. IN ORDER TO FACILITATE THE TRANSFER
OF SHARES DURING THE PERIOD DESCRIBED ABOVE, THE SHARES OF EACH SERIES OF
PREFERRED WILL TRADE "WITH PROXY" IN THE OVER-THE-COUNTER MARKET. SETTLEMENT
OF ALL TRADES DURING THE PERIOD DESCRIBED ABOVE SHOULD INCLUDE AN ASSIGNMENT
OF PROXY FROM THE SELLER.
The Shares will trade, during the period which begins two business days
prior to the Record Date and which will end at the close of business on the
Expiration Date, in the over-the-counter market "with proxy." A Preferred
Shareholder who acquires Shares during this period must obtain, or have its
authorized representative obtain, an assignment of proxy (which is included in
the applicable Letter of Transmittal and Proxy) at settlement from the seller.
The National Association of Securities Dealers, Inc. (the "NASD") and The
Depository Trust
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<PAGE>
Company ("DTC") have issued notices informing their members and participants
that the Shares will trade "with proxy" and that settlement of all trades
during the period described above should include an assignment of proxy from
the seller.
FOR FURTHER INFORMATION, CALL THE INFORMATION AGENT OR THE DEALER MANAGER OR
CONSULT YOUR BROKER FOR ASSISTANCE.
A tender of Shares made pursuant to any method of delivery set forth herein
or in the Letter of Transmittal and Proxy will constitute a binding agreement
between the tendering holder and Conectiv upon the terms and subject to the
conditions of the Offer.
The Depositary will establish an account with respect to the Shares at DTC
(the "Book-Entry Transfer Facility") for purposes of the Offer within two
business days after the date of this Offer to Purchase and Proxy Statement,
and any financial institution that is a participant in the system of the Book-
Entry Transfer Facility may make delivery of Shares by causing the Book-Entry
Transfer Facility to transfer such Shares into the Depositary's account in
accordance with the procedures of the Book-Entry Transfer Facility. Although
delivery of Shares may be effected through book-entry transfer, such delivery
must be accompanied by either (i) a properly completed and duly executed
Letter of Transmittal and Proxy, together with any required signature
guarantees and any other required documents, or (ii) an Agent's Message (as
hereinafter defined) and, in any case, must be received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase and
Proxy Statement on or prior to 5:00 p.m., New York City time, on the
Expiration Date. DELIVERY OF SUCH LETTER OF TRANSMITTAL AND PROXY AND ANY
OTHER REQUIRED DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY OR TO CONECTIV OR
THE COMPANY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility, received by the Depositary and forming a part of the book-
entry transfer when a tender is initiated, which states that the Book-Entry
Transfer Facility has received an express acknowledgment from a participant
tendering Shares that such participant has received and agrees to be bound by
the terms of the Letter of Transmittal and Proxy and that Conectiv may enforce
such agreement against such participant.
If Shares are registered in the name of a person other than the signatory on
the Letter of Transmittal and Proxy, or if unpurchased Shares are to be issued
to a person other than the registered holder(s), the certificates must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name or names of the registered holder(s) appear on the Shares
with the signature(s) on the Shares or stock powers guaranteed as stated
above. See Instructions 4, 6 and 7 to the Letter of Transmittal and Proxy.
Except as otherwise provided below, all signatures on a Letter of Transmittal
and Proxy must be guaranteed by a firm that is a member of a registered
national securities exchange or the NASD, or by a commercial bank or trust
company having an office or correspondent in the United States that is a
participant in an approved Signature Guarantee Medallion Program (each of the
foregoing being referred to as an "Eligible Institution"). Signatures on a
Letter of Transmittal and Proxy need not be guaranteed if (a) the Letter of
Transmittal and Proxy is signed by the registered owner of the Shares tendered
therewith and such owner has not completed the box entitled "Special Payment
Instructions" or the box entitled "Special Delivery Instructions" on the
Letter of Transmittal and Proxy, (b) such Shares are tendered for the account
of an Eligible Institution or (c) the Letter of Transmittal and Proxy is being
used solely for the purpose of voting Shares which are not being tendered
pursuant to the Offer. See Instructions 1 and 5 of the Letter of Transmittal
and Proxy.
Guaranteed Delivery Procedure. If a Preferred Shareholder desires to tender
Shares pursuant to the Offer and such Preferred Shareholder's certificates are
not immediately available or the procedures for book-entry transfer cannot be
completed on a timely basis or time will not permit all required documents to
reach the
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<PAGE>
Depositary prior to the Expiration Date, such Shares may nevertheless be
tendered if all of the following guaranteed delivery procedures are complied
with:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed Delivery
and Proxy, substantially in the form provided by Conectiv and the Company
herewith, is received (with any required signatures or signature
guarantees) by the Depositary as provided below on or prior to the
Expiration Date; and
(iii) the certificates for all tendered Shares in proper form for
transfer or a Book-Entry Confirmation with respect to all tendered Shares,
together with a properly completed and duly executed Letter of Transmittal
and Proxy (or, if applicable, an Agent's Message) and any other documents
required by the Letter of Transmittal and Proxy, are received by the
Depositary no later than 5:00 p.m., New York City time, within three
business days after the date of execution of such Notice of Guaranteed
Delivery and Proxy.
THE NOTICE OF GUARANTEED DELIVERY AND PROXY MAY BE DELIVERED BY HAND OR
MAILED TO THE DEPOSITARY AND MUST INCLUDE AN ENDORSEMENT BY AN ELIGIBLE
INSTITUTION IN THE FORM SET FORTH IN SUCH NOTICE OF GUARANTEED DELIVERY AND
PROXY.
In all cases, Shares shall not be deemed validly tendered unless a properly
completed and duly executed Letter of Transmittal and Proxy or, if applicable,
an Agent's Message, is received by the Depositary within the applicable time
limits and vote in favor of the Proposed Amendment in respect of such Shares
has been cast at the Special Meeting either in person or by completion and
execution of the proxy (which proxy must be in the form of proxy that is a
part of the applicable Letter of Transmittal and Proxy).
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer in all cases will be made only after timely
receipt by the Depositary of certificates for (or an Agent's Message with
respect to) such Shares, a Letter of Transmittal and Proxy, properly completed
and duly executed, with any required signature guarantees and all other
documents required by the Letter of Transmittal and Proxy.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE PREFERRED SHAREHOLDER. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. BECAUSE IT IS THE TIME OF RECEIPT, NOT THE TIME OF MAILING, WHICH
DETERMINES WHETHER A TENDER HAS BEEN MADE PRIOR TO THE EXPIRATION DATE,
SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY.
TO AVOID FEDERAL INCOME TAX BACKUP WITHHOLDING EQUAL TO 31% OF THE GROSS
PAYMENTS MADE PURSUANT TO THE OFFER OR, ALTERNATIVELY, THE SPECIAL CASH
PAYMENT, EACH TENDERING PREFERRED SHAREHOLDER AND EACH NON-TENDERING PREFERRED
SHAREHOLDER WHO VOTES FOR THE PROPOSED AMENDMENT MUST NOTIFY THE DEPOSITARY OF
SUCH PREFERRED SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND
PROVIDE CERTAIN OTHER INFORMATION BY PROPERLY COMPLETING AND EXECUTING THE
SUBSTITUTE FORM W-9 INCLUDED IN THE LETTER OF TRANSMITTAL AND PROXY (OR, IN
THE CASE OF A FOREIGN PREFERRED SHAREHOLDER, MUST COMPLETE AND EXECUTE FORM W-
8 OBTAINABLE FROM THE DEPOSITARY). SEE "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES--BACKUP WITHHOLDING."
EACH PREFERRED SHAREHOLDER IS URGED TO CONSULT WITH HIS OR HER OWN TAX
ADVISOR REGARDING THE TAX CONSEQUENCES OF THE OFFER.
All questions as to the form of documents and the validity, eligibility
(including the time of receipt) and acceptance for payment of any tender of
Shares will be determined by Conectiv, in its sole discretion, and its
7
<PAGE>
determination will be final and binding. Conectiv reserves the absolute right
to reject any or all tenders of Shares that (i) it determines are not in
proper form or (ii) the acceptance for payment of or payment for which may, in
the opinion of Conectiv's counsel, be unlawful. Conectiv also reserves the
absolute right to waive any defect or irregularity in any tender of Shares.
None of Conectiv, the Company, the Dealer Manager, the Depositary, the
Information Agent or any other person will be under any duty to give notice of
any defect or irregularity in tenders, nor shall any of them incur any
liability for failure to give any such notice.
WITHDRAWAL RIGHTS
ANY SHARES FOR WHICH A VOTE IN FAVOR OF THE PROPOSED AMENDMENT WAS NOT
VALIDLY CAST AT THE SPECIAL MEETING WILL BE DEEMED WITHDRAWN AND NOT VALIDLY
TENDERED BY THE RESPECTIVE PREFERRED SHAREHOLDER.
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn after November 5, 1998, unless previously accepted
for payment as provided in this Offer to Purchase and Proxy Statement.
The proxy accompanying any tendered Shares that are withdrawn will not be
considered revoked unless the Preferred Shareholder specifically revokes such
proxy as described herein. See "Proposed Amendment and Proxy Solicitation--
Proxies."
To be effective, a written notice of withdrawal must be timely received by
the Depositary, at one of its addresses set forth on the back cover of this
Offer to Purchase and Proxy Statement, and must specify the name of the person
who tendered the Shares to be withdrawn and the number of Shares to be
withdrawn. If the Shares to be withdrawn have been delivered to the
Depositary, a signed notice of withdrawal with signatures guaranteed by an
Eligible Institution (except in the case of Shares tendered by an Eligible
Institution) must be submitted prior to the release of such Shares. In
addition, such notice must specify, in the case of Shares tendered by delivery
of certificates, the name of the registered owner (if different from that of
the Preferred Shareholder who tenders) and the serial numbers shown on the
particular certificates evidencing the Shares to be withdrawn or, in the case
of Shares tendered by book-entry transfer, the name and number of the account
at the Book-Entry Transfer Facility to be credited with the withdrawn Shares
and the name of the registered holder (if different from the name of such
account). Withdrawals may not be rescinded, and Shares withdrawn will
thereafter be deemed not validly tendered for purposes of the Offer. However,
withdrawn Shares may be re-tendered by again following one of the procedures
described in "Terms of the Offer--Procedure for Tendering Shares" at any time
prior to the Expiration Date.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by Conectiv, in its sole discretion,
and its determination will be final and binding. None of Conectiv, the
Company, the Dealer Manager, the Depositary, the Information Agent or any
other person will be under any duty to give notification of any defect or
irregularity in any notice of withdrawal or will incur any liability for
failure to give any such notification.
ACCEPTANCE OF SHARES FOR PAYMENT AND PAYMENT OF PURCHASE PRICE AND DIVIDENDS
Upon the terms and subject to the conditions of the Offer, and as promptly
as practicable after the Expiration Date, Conectiv will accept for payment
(and thereby purchase) and pay for Shares validly tendered and not withdrawn
as permitted in "Terms of the Offer--Withdrawal Rights." Thereafter, payment
for all Shares validly tendered on or prior to the Expiration Date and
accepted pursuant to the Offer will be made by the Depositary by check as
promptly as practicable after the Expiration Date. In all cases, payment for
Shares accepted for payment pursuant to the Offer will be made promptly but
only after timely receipt by the Depositary of certificates for such Shares
(or of an Agent's Message), a properly completed and duly executed Letter of
Transmittal and Proxy and any other required documents.
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<PAGE>
For purposes of the Offer, Conectiv will be deemed to have accepted for
payment (and thereby purchased) Shares that are validly tendered and not
withdrawn as, if and when it gives oral or written notice to the Depositary of
its acceptance for payment of such Shares. Conectiv will pay for Shares that
it has purchased pursuant to the Offer by depositing the purchase price
therefor with the Depositary, which will act as agent for Preferred
Shareholders who tender for the purpose of receiving payment from Conectiv and
transmitting payment to Preferred Shareholders who tender. The Depositary will
act as agent for Preferred Shareholders who tender for the purpose of
receiving payment from the Company and transmitting payment to Preferred
Shareholders who tender. Under no circumstances will interest be paid on
amounts to be paid by either the Company or Conectiv to tendering Preferred
Shareholders who tender, regardless of any delay in making such payment.
Certificates for all Shares not validly tendered will be returned or, in the
case of Shares tendered by book-entry transfer, such Shares will be credited
to an account maintained with the Book-Entry Transfer Facility, as promptly as
practicable, without expense to the Preferred Shareholder who tenders.
If certain events occur, Conectiv may not be obligated to purchase Shares
pursuant to the Offer. See "Terms of the Offer -- Certain Conditions of the
Offer."
Conectiv will pay or cause to be paid any stock transfer taxes with respect
to the sale and transfer of any Shares to it or its order pursuant to the
Offer. If, however, payment of the purchase price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any person
other than the registered owner, or if tendered Shares are registered in the
name of any person other than the person signing the Letter of Transmittal and
Proxy, the amount of any stock transfer taxes (whether imposed on the
registered owner, such other person or otherwise) payable on account of the
transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes, or exemption therefrom, is
submitted. See Instruction 6 of the accompanying Letter of Transmittal and
Proxy.
CERTAIN CONDITIONS OF THE OFFER
CONECTIV WILL NOT BE REQUIRED TO ACCEPT FOR PAYMENT OR PAY FOR ANY SHARES
TENDERED IF THE PROPOSED AMENDMENT IS NOT APPROVED AND ADOPTED AT THE SPECIAL
MEETING.
IN ORDER TO TENDER THEIR SHARES, PREFERRED SHAREHOLDERS (INCLUDING PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE AND WHO FOLLOW
THE REQUIRED PROCEDURES APPLICABLE TO SUCH SHARES) MUST SUBMIT A DULY
COMPLETED, VALID AND UNREVOKED PROXY INDICATING THEIR VOTE IN FAVOR OF THE
PROPOSED AMENDMENT OR INDICATE IN THE ACCOMPANYING LETTER OF TRANSMITTAL AND
PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE SPECIAL
MEETING. PREFERRED SHAREHOLDERS WHO POSSESS THE PROXY WITH RESPECT TO SUCH
SHARES HAVE THE RIGHT TO VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER
THEY TENDER THEIR SHARES. ANY SHARES FOR WHICH A VOTE IN FAVOR OF THE PROPOSED
AMENDMENT WAS NOT VALIDLY CAST AT THE SPECIAL MEETING WILL BE DEEMED WITHDRAWN
AND NOT VALIDLY TENDERED BY THE RESPECTIVE PREFERRED SHAREHOLDER. PREFERRED
SHAREHOLDERS WHO TENDER THEIR SHARES WILL NOT BE ENTITLED TO THE SPECIAL CASH
PAYMENT. RATHER, PREFERRED SHAREHOLDERS WHO TENDER THEIR SHARES WILL BE
ENTITLED TO ONLY THE PURCHASE PRICE PER SHARE LISTED ON THE FRONT COVER OF
THIS OFFER TO PURCHASE AND PROXY STATEMENT.
In addition, notwithstanding any other provision of the Offer, Conectiv will
not be required to accept for payment or pay for any Shares tendered, and may
terminate or amend the Offer (by oral or written notice to the Depositary and
timely public announcement) or may postpone (subject to the requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") for
prompt payment for or return of Shares) the acceptance for payment of, or
payment for, Shares tendered, if at any time on or after September 9, 1998,
and at or before the Expiration Date, the Commission shall have withheld
approval, under the Holding Company Act,
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<PAGE>
of the acquisition of the Shares by Conectiv pursuant to the Offer or approval
and adoption of the Proposed Amendment at the Special Meeting or any of the
following shall have occurred (which shall not have been waived by Conectiv):
(a) there shall have been threatened, instituted or pending any action or
proceeding by any government or governmental, regulatory or administrative
agency, authority or tribunal or any other person, domestic or foreign, or
before any court, authority, agency or tribunal that (i) challenges the
acquisition of Shares pursuant to the Offer or otherwise in any manner
relates to or affects the Offer or (ii) in the reasonable judgment of
Conectiv, would or might materially and adversely affect the business,
condition (financial or otherwise), income, operations or prospects of
Conectiv and its subsidiaries takes as a whole, or otherwise materially
impair in any way the contemplated future conduct of the business of
Conectiv or any of its subsidiaries or materially impair the Offer's
contemplated benefits to Conectiv or the Company.
(b) there shall have been any action threatened, pending or taken, or
approval withheld, or any statute, rule, regulation, judgment, order or
injunction threatened, proposed, sought, promulgated, enacted, entered,
amended, enforced or deemed to be applicable to the Offer or Conectiv or
any of its subsidiaries, by any legislative body, court, authority, agency
or tribunal that, in Conectiv's reasonable judgment, would or might
directly or indirectly (i) make the acceptance for payment of, or payment
for, some or all of the Shares illegal or otherwise restrict or prohibit
consummation of the Offer; (ii) delay or restrict the ability of Conectiv,
or render Conectiv unable, to accept for payment or pay for some or all of
the Shares; (iii) materially impair the contemplated benefits of the Offer
to Conectiv or the Company (including materially increasing the effective
interest cost of certain types of unsecured debt); or (iv) materially
affect the business, condition (financial or otherwise), income, operations
or prospects of Conectiv and its subsidiaries taken as a whole, or
otherwise materially impair in any way the contemplated future conduct of
the business of Conectiv or any of its subsidiaries;
(c) there shall have occurred (i) any significant decrease in the market
price of the Shares; (ii) any change in the general political, market,
economic or financial conditions in the United States or abroad that, in
the reasonable judgment of Conectiv, would or might have a material adverse
effect on Conectiv's business, operations, prospects or ability to obtain
financing generally or the trading in the Shares or other equity securities
of the Company or Conectiv; (iii) the declaration of a banking moratorium
or any suspension of payments in respect of banks in the United States or
any limitation on, or any event that, in Conectiv's reasonable judgment,
would or might affect the extension of credit by lending institutions in
the United States; (iv) the commencement of war, armed hostilities or other
international or national calamity directly or indirectly involving the
United States; (v) any general suspension of trading in, or limitation on
prices for, securities on any national securities exchange or in the over-
the-counter market; (vi) in the case of any of the foregoing existing at
the time of the commencement of the Offer, in Conectiv's reasonable
judgment, a material acceleration or worsening thereof; (vii) any decline
in either the Dow Jones Industrial Average or the Standard and Poor's
Composite 500 Stock Index by an amount in excess of 15% measured from the
close of business on September 9, 1998; or (viii) a decline in the ratings
accorded any of Conectiv's or the Company's securities by Standard & Poor's
Rating Services ("S&P"), Moody's Investors Service, Inc. ("Moody's") or
Duff & Phelps, Inc. ("D&P") or that S&P, Moody's or D&P has announced that
it has placed any such rating under surveillance or review with negative
implications;
(d) any tender or exchange offer with respect to some or all of the
outstanding preferred stock of the Company (other than the Offer) or other
equity securities of the Company or Conectiv, or a merger, acquisition or
other business combination proposal for Conectiv, shall have been proposed,
announced or made by any person or entity;
(e) there shall have occurred any event or events that have resulted, or
in Conectiv's reasonable judgment may result, in an actual or threatened
change in the business, condition (financial or otherwise), income,
operations, stock ownership or prospects of Conectiv and its subsidiaries;
or
(f) the Company elects not to proceed with the proposed offering of the
trust preferred securities by Atlantic Capital II, a special purpose
business trust controlled by the Company ("Atlantic Capital II"), or the
offering of the trust preferred securities, if commenced, is terminated on
or prior to the Expiration Date;
10
<PAGE>
and, in the sole judgment of Conectiv, such event or events make it
undesirable or inadvisable to proceed with the Offer or with such acceptance
for payment or payment. With respect to the approval of the Commission
referenced above, the Commission must find that the acquisition of the Shares
by Conectiv is not detrimental to the public interest or the interests of
investors or consumers, and that the consideration paid in connection with the
acquisition and the adoption of the Proposed Amendment, including fees,
commissions and other remuneration, is reasonable.
The foregoing conditions (including the condition that the Proposed
Amendment be approved and adopted at the Special Meeting) are for the sole
benefit of Conectiv and may be asserted by Conectiv regardless of the
circumstances (including any action or inaction by Conectiv) giving rise to
any such condition, and any such condition may be waived by Conectiv, in whole
or in part, at any time and from time to time in its sole discretion. A
decision by Conectiv to terminate or otherwise amend any Offer, following the
occurrence of any of the foregoing, with respect to one Series of Preferred
will not create an obligation on behalf of Conectiv to terminate or otherwise
amend in a similar manner the Offer with respect to any other Series of
Preferred. The failure by Conectiv at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time. Any determination by Conectiv concerning the events
described above will be final and binding on all parties.
EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS
Conectiv expressly reserves the right, in its sole discretion, and at any
time and/or from time to time prior to the Expiration Date, to extend the
period of time during which the Offer for any Series of Preferred is open by
giving oral or written notice of such extension to the Depositary, without
extending the period of time during which the Offer for any other Series of
Preferred is open. There can be no assurance, however, that Conectiv will
exercise its right to extend the Offer for any Series of Preferred. During any
such extension, all Shares of the subject Series of Preferred previously
tendered will remain subject to the Offer, except to the extent that such
Shares may be withdrawn as set forth in "Terms of the Offer -- Withdrawal
Rights."
Conectiv also expressly reserves the right, in its sole discretion, to,
among other things, terminate the Offer and not accept for payment or pay for
any Shares tendered, subject to Rule 13e-4(f)(5) under the Exchange Act, which
requires Conectiv either to pay the consideration offered or to return the
Shares tendered promptly after the termination or withdrawal of the Offer upon
the occurrence of any of the conditions specified in "Terms of the Offer --
Certain Conditions of the Offer" by giving oral or written notice of such
termination to the Depositary, and making a public announcement thereof.
Subject to compliance with applicable law, Conectiv further reserves the
right, in its sole discretion, to amend the Offer in any respect. Amendments
to the Offer may be made at any time and/or from time to time effected by
public announcement thereof, such announcement, in the case of an extension,
to be issued no later than 9:00 a.m., New York City time, on the next business
day after the previously scheduled Expiration Date. Any public announcement
made pursuant to the Offer will be disseminated promptly to Preferred
Shareholders affected thereby in a manner reasonably designed to inform such
Preferred Shareholders of such change. Without limiting the manner in which
Conectiv may choose to make a public announcement, except as required by
applicable law, Conectiv shall have no obligation to publish, advertise or
otherwise communicate any such public announcement other than by making a
release to the Dow Jones News Service.
If Conectiv materially changes the terms of the Offer or the information
concerning the Offer, or if it waives a material condition of the Offer,
Conectiv will extend the Offer to the extent required by Rules 13e-4(d)(2) and
13e-4(e)(2) under the Exchange Act. Those rules require that the minimum
period during which the Offer must remain open following material changes in
the terms of the Offer or information concerning the Offer (other than a
change in price, a change in percentage of securities sought or a change in
the dealer's solicitation fee) will depend on the facts and circumstances,
including the relative materiality of such terms or information. The
Commission has stated that, in its view, an offer should remain open for a
minimum of five business days from the date that a notice of such a material
change is first published, sent or given. If the Offer is scheduled to
11
<PAGE>
expire at any time earlier than the expiration of a period ending on the tenth
business day from, and including, the date that Conectiv publishes, sends or
gives to Preferred Shareholders a notice that it will (i) increase or decrease
the price it will pay for Shares, (ii) decrease the percentage of Shares it
seeks, or (iii) increase or decrease the soliciting dealers' fees, the Offer
will be extended until the expiration of such period of ten business days.
THE OFFER FOR EACH SERIES OF PREFERRED IS INDEPENDENT OF THE OFFER FOR ANY
OTHER SERIES OF PREFERRED. IF CONECTIV EXTENDS OR AMENDS ANY OFFER WITH
RESPECT TO ONE SERIES OF PREFERRED FOR ANY REASON, CONECTIV WILL HAVE NO
OBLIGATION TO EXTEND OR AMEND THE OFFER FOR ANY OTHER SERIES OF PREFERRED.
PROPOSED AMENDMENT AND PROXY SOLICITATION
INTRODUCTION
This Offer to Purchase and Proxy Statement is first being mailed on or about
September 10, 1998 to the Preferred Shareholders of the Company in connection
with the solicitation of proxies by the Board of Directors of the Company (the
"Board") for use at the Special Meeting. A separate Proxy Statement is being
mailed to the holders of the Company's $7.80 No Par Preferred Stock that is
not included in the Offer.
Preferred Shareholders who wish to tender their Shares pursuant to the Offer
must vote in favor of the Proposed Amendment in person by ballot or by proxy
at the Special Meeting. Only holders of record of the Company's voting
securities at the close of business on the Record Date or persons obtaining a
proxy from the holders of record on the Record Date will be entitled to vote
in person or by proxy at the Special Meeting. If the Proposed Amendment is
approved and adopted by the Company's shareholders, the Company will make a
special cash payment in the amount equal to $1.00 per Share for each Share
properly voted in favor of the Proposed Amendment (the "Special Cash
Payment"); provided that such Shares have not been tendered pursuant to the
Offer. If a Preferred Shareholder votes against the Proposed Amendment or
abstains, such Preferred Shareholder shall not be entitled to the Special Cash
Payment (regardless of whether the Proposed Amendment is approved and
adopted). Those Preferred Shareholders who validly tender their Shares will be
entitled to only the purchase price per Share listed on the front cover of
this Offer to Purchase and Proxy Statement. Preferred Shareholders who validly
tender their Shares will not be entitled to the Special Cash Payment.
VOTING SHARES
With respect to the Company's Cumulative Preferred Stock, $100 par value and
the Company's $7.80 No Par Preferred Stock, September 14, 1998 (the "Record
Date") has been fixed as the record date for the determination of shareholders
entitled to notice of and to vote at the Special Meeting.
The Company's Charter authorizes the issuance of 25,000,000 shares of common
stock, $3 par value, of which 18,320,937 shares are outstanding. All of such
shares are owned by Conectiv.
The Company's Charter also authorizes the issuance of 799,979 shares of
Cumulative Preferred Stock, $100 par value, 2,000,000 shares of $100 No Par
Preferred Stock, and 3,000,000 shares of Preference Stock, without par value,
of which 300,000, 239,500 and 0 shares, respectively, are outstanding on the
Record Date. Such shares are publicly held and vary from each other with
respect to dividend rates, redemption prices and amounts payable on
liquidation. All outstanding shares of the Company's preferred stock are
entitled to vote on the Proposed Amendment as a single class.
VOTING REQUIREMENTS AND PROCEDURES
Adoption of the Proposed Amendment requires the affirmative vote of the
holders of (i) at least two-thirds of the shares of the Company then
outstanding and entitled to vote (i.e., the common stock and the preferred
12
<PAGE>
stock) and (ii) at least two-thirds of the total number of shares of the
Company's preferred stock then outstanding. Abstentions and broker non-votes
will have the same effect as votes against the Proposed Amendment.
CONECTIV, THE OWNER OF ALL OF THE OUTSTANDING SHARES OF COMMON STOCK OF THE
COMPANY, HAS ADVISED THE COMPANY THAT IT INTENDS TO VOTE ALL OF THE
OUTSTANDING SHARES OF COMMON STOCK OF THE COMPANY IN FAVOR OF THE PROPOSED
AMENDMENT.
Votes at the Special Meeting will be tabulated preliminarily by the
Depositary. Inspectors of Election, duly appointed by the presiding officer of
the Special Meeting, will definitively count and tabulate the votes and
determine and announce the results at the Special Meeting. The Company has no
established procedure for confidential voting. There are no rights of
appraisal in connection with the Proposed Amendment.
PROXIES
THE ENCLOSED PROXY, WHICH IS CONTAINED WITHIN THE LETTER OF TRANSMITTAL AND
PROXY (AND THE NOTICE OF GUARANTEED DELIVERY AND PROXY), IS SOLICITED BY THE
COMPANY'S BOARD, WHICH RECOMMENDS VOTING FOR THE PROPOSED AMENDMENT. ALL
SHARES OF THE COMPANY'S COMMON STOCK WILL BE VOTED IN FAVOR OF THE PROPOSED
AMENDMENT. Preferred Shareholders tendering their Shares pursuant to the Offer
and voting at the Special Meeting by proxy must use the proxy that is a part
of the applicable Letter of Transmittal and Proxy. Shares of the Company's
outstanding preferred stock represented by properly executed proxies received
at or prior to the Special Meeting will be voted in accordance with the
instructions thereon. If no instructions are indicated, duly executed proxies
will be voted in accordance with the recommendation of the Board. It is not
anticipated that any other matters will be brought before the Special Meeting.
However, the enclosed proxy gives discretionary authority to the proxy holders
named therein should any other matters be presented at the Special Meeting,
and it is the intention of the proxy holders to act on any other matters in
their discretion.
Execution of a proxy will not prevent a shareholder from attending the
Special Meeting and voting in person. Any shareholder giving a proxy may
revoke it at any time before it is voted by delivering to the Secretary of the
Company written notice of revocation bearing a later date than the proxy, by
delivering a duly executed proxy bearing a later date, or by voting in person
by ballot at the Special Meeting. Withdrawal of Shares tendered pursuant to
the Offer will not revoke a properly executed proxy.
The Company will bear the cost of the solicitation of proxies by the Board.
The Company has engaged D.F. King & Co., Inc. to act as Information Agent in
connection with the solicitation of proxies for a fee of $12,500, plus unit
fees per preferred shareholder contacted, plus reimbursement of reasonable
out-of-pocket expenses. Proxies will be solicited by mail or by telephone. In
addition, officers and employees of the Company and its affiliates may also
solicit proxies personally or by telephone; such persons will receiver no
additional compensation for these services. The Information Agent has not been
retained to make, and will not make, solicitations or recommendations, other
than conveying information related to the recommendations of the Board, in
connection with the Proposed Amendment.
The Company has requested that brokerage houses and other custodians,
nominees and fiduciaries forward solicitation materials to the beneficial
owners of shares of the Company's outstanding preferred stock held of record
by such persons and will reimburse such brokers and other fiduciaries for
their reasonable out-of-pocket expenses incurred in connection therewith.
The solicitation of proxies has been approved by the Commission under the
Holding Company Act. An application has been filed with the Commission under
the Holding Company Act requesting approval of the Proposed Amendment and the
acquisition of the Shares by Conectiv pursuant to the Offer.
13
<PAGE>
SPECIAL CASH PAYMENTS
Subject to the terms and conditions set forth in this Offer to Purchase and
Proxy Statement, if (but only if) the Proposed Amendment is approved and
adopted by the shareholders of the Company, the Company will make a Special
Cash Payment to each Preferred Shareholder who voted in favor of the Proposed
Amendment, in person by ballot or by proxy, at the Special Meeting in the
amount equal to $1.00 per Share for each Share held by such Preferred
Shareholder which is so voted, provided that such Shares have not been
tendered pursuant to the Offer. The Company has been advised that there is no
controlling precedent under state law as to the permissibility of its making
the Special Cash Payment. Although, as a result, there can be no assurance as
to how a court would rule on the issue, the Company believes that the Offer is
fair to Preferred Shareholders and has determined to make the Special Cash
Payment. SPECIAL CASH PAYMENTS WILL BE MADE TO PREFERRED SHAREHOLDERS (IF SUCH
SHARES HAVE NOT BEEN TENDERED PURSUANT TO THE OFFER) ONLY IN RESPECT OF EACH
SHARE WHICH IS VOTED FOR THE ADOPTION OF THE PROPOSED AMENDMENT; PROVIDED,
HOWEVER, THAT THOSE PREFERRED SHAREHOLDERS WHO VALIDLY TENDER THEIR SHARES
WILL NOT BE ENTITLED TO THE SPECIAL CASH PAYMENT. RATHER, THOSE PREFERRED
SHAREHOLDERS WHO VALIDLY TENDER THEIR SHARES WILL BE ENTITLED TO ONLY THE
PURCHASE PRICE PER SHARE LISTED ON THE FRONT COVER OF THIS OFFER TO PURCHASE
AND PROXY STATEMENT.
Only holders of record of the Company's voting securities at the close of
business on the Record Date or persons obtaining a proxy from the holders of
record on the Record Date will be entitled to vote in person or by proxy at
the Special Meeting. Any beneficial holder of Shares who is not the registered
holder of such Shares as of the Record Date (as would be the case for any
beneficial holder whose Shares are registered in the name of such holder's
broker, dealer, commercial bank, trust company or other nominee) must arrange
with the Preferred Shareholder to execute and deliver a proxy form on such
beneficial owner's behalf. If a beneficial holder of Shares intends to attend
the Special Meeting and vote in person, such beneficial holder must obtain a
legal proxy form from his or her broker, dealer, commercial bank, trust
company or other nominee.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As noted above, Conectiv owns all the outstanding common stock of the
Company.
Pursuant to Section 13(d) of the Exchange Act, a beneficial owner of a
security is any person who directly or indirectly has or shares voting or
investment power over such security. No person or group is known by management
of the Company to be the beneficial owner of more than 5% of the shares of the
Company's preferred stock as of September 9, 1998.
Officers and directors of the Company as a group owned, as of September 9,
1998, less than 1% of the total number of shares of the Company's preferred
stock and of the common stock of Conectiv.
BUSINESS TO COME BEFORE THE SPECIAL MEETING
The following Proposed Amendment to the Charter is the only item of business
expected to be presented at the Special Meeting:
To remove in its entirety Paragraph (7)(B)(c) of Article III of the Charter,
a provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
THE FOLLOWING STATEMENTS ARE SUMMARIES OF THE SUBSTANCE OR GENERAL EFFECT OF
PROVISIONS OF THE CHARTER, AND ARE QUALIFIED IN THEIR ENTIRETY BY THE CHARTER
AND PARAGRAPH (7)(B)(c) OF ARTICLE III THEREIN (AS DESCRIBED BELOW). SEE
APPENDIX A HERETO FOR THE TEXT OF THE PROVISION TO BE DELETED.
14
<PAGE>
EXPLANATION OF THE PROPOSED AMENDMENT
Paragraph (7)(B)(c) of Article III of the Charter currently provides that,
so long as any shares of the Company's preferred stock are outstanding,
without the affirmative vote of the holders of at least a majority of the
total voting power of its outstanding shares of preferred stock, the Company
shall not issue or assume any securities representing unsecured indebtedness
(other than for the purpose of refunding outstanding unsecured securities
issued by the Company or redeeming or otherwise retiring outstanding shares of
its preferred stock) if, immediately after such issue or assumption, the total
outstanding principal amount of all securities representing unsecured
indebtedness of the Company would exceed 20% of the aggregate of all existing
secured indebtedness of the Company and the capital and surplus of the Company
as stated on the Company's books (the "Debt Limitation Provision").
The Proposed Amendment, if adopted, would eliminate from the Charter in its
entirety the Debt Limitation Provision. Unless otherwise defined, capitalized
terms used herein are used as defined in the Charter.
Paragraph (7)(B)(c) of Article III of the Charter states:
"(B) So long as any shares of the Cumulative Preferred Stock of any series
are outstanding, the Corporation shall not, without the consent (given by vote
at a meeting called for that purpose) of the holders of a majority of the
total number of shares of the Cumulative Preferred Stock then outstanding:
(c) Issue any unsecured notes, debentures or other securities
representing unsecured indebtedness, or assume any such unsecured
securities, for purposes other than the refunding of outstanding unsecured
securities theretofore issued or assumed by the Corporation or the
redemption or other retirement of outstanding shares of one or more series
of the Cumulative Preferred Stock if, immediately after such issue or
assumption, the total principal amount of all unsecured notes, debentures
or other securities representing unsecured indebtedness issued or assumed
by the Corporation and then outstanding (including unsecured securities
then to be issued or assumed) would exceed twenty per centum (20%) of the
aggregate of (i) the total principal amount of all bonds or other
securities representing secured indebtedness issued or assumed by the
Corporation and then to be outstanding, and (ii) the capital and surplus of
the Corporation as then to be stated on the books of account of the
Corporation."
REASONS FOR THE PROPOSED AMENDMENT
The electric utility industry has become, and will continue to be,
increasingly competitive as the result of various factors, including
regulatory and technological developments. Various federal and state
regulatory initiatives designed to promote wholesale and retail competition
include, among other things, proposals that would allow customers to choose
their electricity provider. As these competitive initiatives materialize, the
structure of the utility industry could radically change. The Company believes
that having the flexibility to respond to developments in the industry will be
crucial to its success in the new competitive marketplace.
The Company believes that adoption of the Proposed Amendment is important to
creating the necessary flexibility to respond to any industry developments.
The restriction that would be eliminated by the Proposed Amendment generally
does not burden the industry's new competitors (power marketers, independent
power producers, exempt wholesale generators and owners of cogeneration
facilities), nor even other public utility companies.
Management considers that elimination of the Debt Limitation Provision is
crucial to the Company's financial flexibility and its ability to effect
future capital cost reductions. The deletion of this provision from the
Charter will allow the Company to utilize more fully various unsecured debt
alternatives and thus improve its ability to take full advantage of changing
conditions in the capital markets. The additional flexibility will, for
example, permit the Company to issue long-term debt when, because of mortgage
coverage restrictions or other reasons, it may be unattractive or not possible
to issue any additional first mortgage bonds. In addition, elimination of the
Debt Limitation Provision will afford the Company greater flexibility in the
issuance of short-term debt to meet seasonal cash requirements with what is
usually the least expensive form of capital.
In the event that the Proposed Amendment is not approved by the required
two-thirds of the shares of the preferred stock but a majority of the shares
of the preferred stock are tendered pursuant to the Offer, Conectiv may elect
to waive the condition to the Offer that requires approval of the Proposed
Amendment and purchase such shares. Conectiv has not determined whether it
will make such an election, but if it were to do so, as holder
15
<PAGE>
of a majority of the shares of the preferred stock, Conectiv would hold a
sufficient number of shares to permit it to consent as a Preferred Shareholder
to the issuance of unsecured indebtedness pursuant to Paragraph (7) (B) (c) of
Article III of the Charter in excess of the limits set forth therein. Without
the prior consent of the Securities and Exchange Commission, Conectiv will be
required to sell its Shares to the Company on or prior to December 31, 2000.
PRICE RANGE OF SHARES; DIVIDENDS
The 4% Series, 4.10% Series, 4.35% Series, 4.35% 2nd Series, 4.75% Series
and 5% Series are traded in the over-the-counter market under the symbols
"ANTEN," "ANTEZ," "ANTEH," "ANTEO," "ANTEM" and "ANTEL," respectively. The
last reported sale price in the over-the-counter market, as of the close of
business on September 3, 1998, for certain of the Series of Preferred is shown
on the front cover of this Offer to Purchase and Proxy Statement. However,
Preferred Shareholders should be aware that the Shares of each Series of
Preferred trade only sporadically and on a limited basis and, therefore, the
last reported sales price may not necessarily reflect the market value of the
Shares.
PREFERRED SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS, IF
AVAILABLE, FOR THE SHARES.
The following table sets forth the high and low sales prices of each Series
of Preferred in the over-the-counter market, as reported by the National
Quotation Bureau, LLC, and the cash dividends paid thereon for the fiscal
quarters indicated.
DIVIDENDS AND PRICE RANGES OF SERIES OF PREFERRED
BY QUARTERS (1996, 1997 AND 1998)
<TABLE>
<CAPTION>
1996-QUARTERS 1997-QUARTERS 1998-QUARTERS
--------------- ------------------------------- ---------------
3RD 4TH 1ST 2ND 3RD 4TH 1ST 2ND
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
4% SERIES
Dividends Per Share..... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Market Price--$ Per
Share
--High................ 52.375 54.25 55.00 56.50 60.25 62.875 65.125 67.00
--Low................. 51.375 52.125 52.50 53.50 55.00 57.00 58.25 61.375
4.10% SERIES
Dividends Per Share..... $1.025 $1.025 $1.025 $1.025 $1.025 $1.025 $1.025 $1.025
Market Price--$ Per
Share
--High................ -- -- -- -- -- -- -- --
--Low................. -- -- -- -- -- -- -- --
4.35% SERIES
Dividends Per Share..... $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875
Market Price--$ Per
Share
--High................ -- -- -- -- -- -- -- --
--Low................. -- -- -- -- -- -- -- --
4.35% 2ND SERIES
Dividends Per Share..... $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875 $1.0875
Market Price--$ Per
Share
--High................ 58.125 -- -- -- -- -- 64.50 63.00
--Low................. 54.375 -- -- -- -- -- 62.00 62.00
4.75% SERIES
Dividends Per Share..... $1.1875 $1.1875 $1.1875 $1.1875 $1.1875 $1.1875 $1.1875 $1.1875
Market Price--$ Per
Share
--High................ 62.00 67.00 70.00 66.875 70.75 75.25 78.25 80.875
--Low................. 58.375 62.00 62.50 66.500 58.00 69.375 70.25 75.00
5% SERIES
Dividends Per Share..... $1.25 $1.25 $1.25 $1.25 $1.25 $1.25 $1.25 $1.25
Market Price--$ Per
Share
--High................ -- -- -- -- -- 64.00 -- 80.375
--Low................. -- -- -- -- -- 64.00 -- 70.000
</TABLE>
- --------
Dash indicates no reported sales during the quarter.
16
<PAGE>
The holders of the Company's preferred stock are entitled to receive, if,
when and as declared by the Board, cash dividends at the annual rate specified
for the preferred stock, and no more, cumulative and payable quarterly with
respect to each calendar quarterly period, on each February 1, May 1, August 1
and November 1. An indenture relating to the proposed issuance of trust
preferred securities by Atlantic Capital II may provide that dividends on the
Company's capital stock may not be paid as long as any payments on the
Company's Junior Subordinated Debentures to be issued under such indenture
have been deferred or the Company is in default under such indenture or its
guarantee relating to such trust preferred securities. A similar provision
appears in the indenture relating to trust preferred securities issued by
Atlantic Capital I in October 1996.
To date, the Company has timely made all quarterly dividend payments on the
Company's preferred stock.
The Board of Directors of the Company will consider the declaration of
dividends on the Company's capital stock at its meeting on September 24, 1998.
The Regular Quarterly Dividend for the Company's preferred stock, if, when and
as declared, will be paid on November 2, 1998 to holders of record as of the
close of business on October 2, 1998. A holder of record of Shares on October
2, 1998 who tenders Shares will be entitled to the Regular Quarterly Dividend,
regardless of when such tender is made. Holders of Shares pursuant to the
Offer will not be entitled to any dividends in respect of any later dividend
periods.
PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER
Conectiv believes that the purchase of the Shares at this time will provide
financial flexibility beneficial to the Company and, indirectly, Conectiv and
its shareholders. In addition, the Offer gives Preferred Shareholders the
opportunity to sell their Shares at a price which Conectiv believes to be a
premium to the market price on the date of the announcement of the Offer and
without the usual transaction costs associated with a sale.
After the consummation of the Offer, Conectiv or the Company may purchase
additional Shares on the open market, in privately negotiated transactions,
through one or more tender offers or otherwise. Any such purchases may be on
the same terms as, or on terms which are more or less favorable to holders of
Shares than, the terms of the Offer. However, Rule 13e-4(f)(6) under the
Exchange Act prohibits Conectiv and its affiliates (including the Company)
from purchasing any Shares of a Series of Preferred, other than pursuant to
the Offer, until at least ten business days after the Expiration Date with
respect to such Series of Preferred. Any future purchases of Shares by
Conectiv or the Company would depend on many factors, including the market
price of the Shares, Conectiv's business and financial position, legal
restrictions on Conectiv's ability to purchase Shares as well as general
economic and market conditions.
Preferred Shareholders are not under any obligation to tender Shares
pursuant to the Offer. The Offer does not constitute notice of redemption of
any Series of Preferred pursuant to the Company's Charter, nor does Conectiv
or the Company intend to effect any such redemption by making the Offer.
Further, the Offer does not constitute a waiver by the Company of any option
it has to redeem Shares. The 4% Series, the 4.10% Series, the 4.35% Series,
the 4.35% 2nd Series, the 4.75% Series and 5% Series are presently callable at
$105.50 per Share, $101.00 per Share, $101.00 per Share, $101.00 per Share,
$101.00 per Share and $100.00 per Share, respectively. The Shares of each
Series of Preferred have no preemptive or conversion rights.
Upon liquidation or dissolution of the Company, owners of the Shares would
be entitled to receive an amount equal to the liquidation preference per Share
($100) (except that the amount payable in the event of a voluntary liquidation
shall be equivalent to the then current redemption price per Share) plus all
accrued and unpaid dividends (whether or not earned or declared) thereon to
the date of payment, prior to the payment of any amounts to the holders of the
Company's common stock.
Shares validly tendered to the Depositary pursuant to the Offer and not
withdrawn in accordance with the procedures set forth herein shall be held
until the Expiration Date (or returned to the extent the Offer is terminated
in accordance herewith). To the extent that the Proposed Amendment is approved
and the Shares
17
<PAGE>
tendered are accepted for payment and paid for in accordance with the terms
hereof, Conectiv intends to sell its Shares to the Company and, at that time,
it is expected that the Company will retire and cancel the Shares. However, in
the event the Proposed Amendment is not adopted at the Special Meeting,
Conectiv may elect, but is not obligated to, waive such condition, subject to
applicable law. In that case, subsequent to Conectiv's waiver and purchase of
the Shares, the Company anticipates that, as promptly as practicable
thereafter, it would either adjourn the Special Meeting or call another
special meeting of its shareholders and solicit proxies therefrom for an
amendment substantially similar to the Proposed Amendment. At that meeting,
Conectiv would vote any Shares acquired by it pursuant to the Offer or
otherwise (together with its shares of common stock) in favor of such
amendment, thereby maximizing the prospects for the adoption of the amendment.
In the event that the Proposed Amendment is not approved by the required
two-thirds of the shares of the preferred stock but a majority of the shares
of the preferred stock are tendered pursuant to the Offer, Conectiv may elect
to waive the condition to the Offer that requires approval of the Proposed
Amendment and purchase such shares. Conectiv has not determined whether it
will make such an election, but if it were to do so, as holder of a majority
of the shares of the preferred stock, Conectiv would hold a sufficient number
of shares to permit it to consent as a Preferred Shareholder to the issuance
of unsecured indebtedness pursuant to Paragraph (7) (B) (c) of Article III of
the Charter in excess of the limits set forth therein. Without the prior
consent of the Securities and Exchange Commission, Conectiv will be required
to sell its Shares to the Company on or prior to December 31, 2000. Any
purchase of Shares by Conectiv will reduce the number of Shares of each of the
Series of Preferred that might otherwise trade publicly or become available
for purchase and/or sale and likely will reduce the number of owners of Shares
of each of the Series of Preferred, which could adversely affect the liquidity
and sale value of the Shares not purchased in the Offer.
Liquidity of Trading Market. To the extent that Shares of any Series of
Preferred are tendered and accepted for payment in the Offer, the trading
market for Shares of such Series of Preferred that remain outstanding may be
significantly more limited, which might adversely affect the liquidity, market
value and price volatility of such Shares. Equity securities with a smaller
outstanding market value available for trading (the "float") may command a
lower price than would comparable equity securities with a greater float.
Therefore, the market price for Shares that are not tendered in the Offer may
be affected adversely to the extent that the amount of Shares purchased
pursuant to the Offer reduces the float. The reduced float may also make the
trading price of the Shares that are not tendered and accepted for payment
more volatile. Preferred Shareholders of the remaining Shares may attempt to
obtain quotations for the Shares from their brokers; however, there can be no
assurance that any trading market will exist for such Shares following
consummation of the Offer. To the extent a market continues to exist for the
Shares after the offer, the Shares may trade at a discount compared to present
trading depending on the market for Shares with similar features, the
performance of the Company, and other factors. There is no assurance that an
active market in the Shares will exist following consummation of the Offer and
no assurance as to the prices at which the Shares may then trade.
The purchase of Shares of the Series of Preferred Stock pursuant to the
Offer will reduce the number of holders of Shares of the Series of Preferred
Stock and the number of such Shares that might otherwise trade publicly, and,
depending upon the number of Shares so purchased, such reduction could
adversely affect the liquidity and market value of the remaining Shares of the
Series of Preferred Stock held by the public. The extent of the public market
for the Shares of the Series of Preferred Stock and the availability of price
quotations would, however, depend upon such factors as the number of
shareholders remaining at such time, the interest in maintaining a market in
the Shares of the Series of Preferred Stock on the part of securities firms
and other factors. As of September 9, 1998, there were 429 registered holders
of the 4% Series, 6 registered holders of the 4.10% Series, 13 registered
holders of the 4.35% Series, 27 registered holders of the 4.35% 2nd Series, 57
registered holders of the 4.75% Series and 17 registered holders of the 5%
Series.
Other Potential Effects of the Proposed Amendment on Preferred Shareholders
who do not Tender. If the Proposed Amendment becomes effective, Shares that
are not tendered and purchased pursuant to the Offer will no longer be subject
to the Debt Limitation Provision, which will have been deleted by the Proposed
Amendment. As discussed above, the Debt Limitation Provision places
restrictions on the Company's ability to
18
<PAGE>
issue securities representing unsecured indebtedness. Although the Company's
debt instruments may contain certain restrictions on the Company's ability to
issue or assume debt, any such restrictions may be waived and the increased
flexibility afforded the Company by the deletion of the Debt Limitation
Provision may permit the Company to take certain actions that may increase the
credit risks with respect to the Company, adversely affecting the market price
and credit rating of the remaining Shares, or otherwise be materially adverse
to the interests of the remaining Preferred Shareholders. In addition, to the
extent that the Company elects to fund its purchase of the Shares by issuing
additional unsecured debt, the remaining Preferred Shareholders' relative
position in the Company's capital structure could be perceived to decline,
which in turn could adversely affect the market price and credit rating of the
remaining Shares. See, however, "Proposed Amendment and Proxy Solicitation --
Reasons for the Proposed Amendment."
Following the consummation of the Offer, the business and operations of the
Company are currently expected to be continued substantially as they are
currently being conducted. Except as disclosed in this Offer to Purchase and
Proxy Statement, Conectiv and the Company currently have no plans or proposals
that relate to or would result in: (a) the acquisition by any person or entity
of additional securities of the Company or the disposition of securities of
the Company, other than in the ordinary course of business; (b) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Company; (c) a sale or transfer of a material
amount of assets of the Company; (d) any change in the present Board or
management of the Company; (e) any material change in the present dividend
rate or policy, or indebtedness or capitalization of the Company; (f) any
other material change in the Company's corporate structure or business; (g)
any change in the Company's Charter or by-laws or any actions that may impede
the acquisition of control of the Company by any person; (h) a class of equity
securities of the Company being delisted from a national securities exchange
or no longer authorized to be quoted on the OTC; (i) a class of equity
securities of the Company becoming eligible for termination of registration
pursuant to Section 12(g)(4) of the Exchange Act; or (j) the suspension of the
Company's obligation to file reports pursuant to Section 15(d) of the Exchange
Act.
However, in order to adapt to the increasingly competitive environment in
which they operate, Conectiv and its operating affiliates, including the
Company, will evaluate and consider a wide array of potential business
strategies. These may include business combinations or acquisitions involving
other utility or non-utility businesses or properties, internal restructurings
or reorganizations involving Conectiv, its operating affiliates or some
combination thereof or dispositions of currently owned properties or currently
operated business units. Furthermore, Conectiv and its operating affiliates,
including the Company, may engage in other new business ventures which arise
from competitive and regulatory changes in the utility industry. Pursuit of
any of the above strategies, or any combination thereof, may significantly
affect the business operations and financial condition of Conectiv and its
operating affiliates, including the Company.
NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR ANY
OF THEIR RESPECTIVE OFFICERS MAKE ANY RECOMMENDATION TO ANY PREFERRED
SHAREHOLDER AS TO WHETHER TO TENDER ALL OR ANY SHARES. EACH PREFERRED
SHAREHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES
AND, IF SO, HOW MANY SHARES TO TENDER.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following summary describes certain United States federal income tax
considerations with respect to the sale of Shares pursuant to the Offer and
the receipt of Special Cash Payments in connection with the approval and
adoption of the Proposed Amendment. This summary is based on the Internal
Revenue Code of 1986, as amended to the date hereof (the "Code"),
administrative pronouncements, judicial decisions and existing and proposed
Treasury Regulations, changes to any of which subsequent to the date of this
Offer to Purchase and Proxy Statement may adversely affect the tax
consequences described herein, possibly on a retroactive basis. This summary
is addressed to Preferred Shareholders who hold Shares as capital assets
within the meaning of Section 1221 of the Code. This summary does not discuss
all of the tax consequences that may be relevant to a
19
<PAGE>
Preferred Shareholder in light of such Preferred Shareholder's particular
circumstances or to Preferred Shareholders subject to special rules (including
certain financial institutions, tax-exempt organizations, insurance companies,
dealers in securities or currencies, Preferred Shareholders who acquired their
Shares pursuant to the exercise of stock options or other compensation
arrangements with the Company or Preferred Shareholders holding the Shares as
part of a conversion transaction, as part of a hedge or hedging transaction,
or as a position in a straddle for tax purposes). Preferred Shareholders
should consult their tax advisors with regard to the application of the United
States federal income tax laws to their particular situations as well as any
tax consequences arising under the laws of any state, local or foreign taxing
jurisdiction.
As used herein, the term "United States Preferred Shareholder" means an
owner of a Share that is (i) for United States federal income tax purposes a
citizen or resident of the United States; (ii) a corporation or partnership
created or organized in or under the laws of the United States or of any
political subdivision thereof; (iii) an estate the income of which is subject
to United States federal income taxation regardless of its source; or (iv) a
trust if a court within the United States is able to exercise primary
supervision over the administration of such trust and one or more United
States persons have the authority to control all substantial decisions of such
trust. A "Non-United States Preferred Shareholder" is a Preferred Shareholder
that is not a United States Preferred Shareholder.
TAX CONSIDERATIONS FOR TENDERING PREFERRED SHAREHOLDERS
United States Preferred Shareholders. A United States Preferred Shareholder
will recognize gain or loss equal to the difference between the tax basis of
such Preferred Shareholder's Shares and the amount of cash received in
exchange therefor. A United States Preferred Shareholder's gain or loss will
be capital gain or loss. Capital gains of individuals derived in respect of
capital assets held for more than one year are eligible for reduced rates of
taxation. The deductibility of capital losses is subject to limitations.
Non-United States Preferred Shareholders. Any capital gain realized upon the
sale of Shares by a Non-United States Preferred Shareholder pursuant to the
Offer generally will not be subject to United States federal income tax unless
(i) such gain is effectively connected with the conduct of a trade or business
in the United States of the Non-United States Preferred Shareholder or (ii) in
the case of a Non-United States Preferred Shareholder who is an individual,
such individual is present in the United States for 183 days or more in the
taxable year of such sale or exchange and certain other conditions are met. A
Non-United States Preferred Shareholder described in clause (i) above will be
taxed on the net capital gain derived from the sale at applicable graduated
individual or corporate rates. Any such effectively connected income received
by a foreign corporation may be subject to an additional "branch profits tax"
at a 30% rate (or such lower rate as may be specified by an applicable income
tax treaty). Unless an applicable tax treaty provides otherwise, an individual
Non-United States Preferred Shareholder described in clause (ii) above will be
subject to a flat 30% tax on the gain derived from the sale, which may be
offset by United States losses (notwithstanding the fact that the individual
is not considered a resident of the United States).
TAX CONSIDERATIONS FOR NON-TENDERING PREFERRED SHAREHOLDERS
United States Preferred Shareholders. There is no direct authority
concerning the federal income tax consequences of the receipt of Special Cash
Payments. The Company will, for information reporting purposes, treat Special
Cash Payments as ordinary non-dividend income to recipient United States
Preferred Shareholders.
Non-United States Preferred Shareholders. The Company will treat Special
Cash Payments paid to a Non-United States Preferred Shareholder as subject to
withholding of United States federal income tax at a 30% rate. However,
Special Cash Payments that are effectively connected with the conduct of a
trade or business by the Non-United States Preferred Shareholder within the
United States are not subject to the withholding tax (provided such Non-United
States Preferred Shareholder provides two originals of IRS Form 4224 stating
that such Special Cash Payments are so effectively connected), but instead are
subject to United States federal income tax on a net income basis at
applicable graduated individual or corporate rates. Any such effectively
connected Special Cash Payments received by a foreign corporation may be
subject to an additional "branch profits tax" at a 30% rate (or such lower
rate as may be specified by an applicable income tax treaty).
20
<PAGE>
A Non-United States Preferred Shareholder eligible for a reduced rate of
United States withholding tax pursuant to an income tax treaty may obtain a
refund of any excess amounts withheld by filing an appropriate claim for
refund with the IRS.
BACKUP WITHHOLDING
ANY UNITED STATES PREFERRED SHAREHOLDER WHO FAILS TO COMPLETE AND SIGN THE
SUBSTITUTE FORM W-9 THAT IS INCLUDED IN THE APPLICABLE LETTER OF TRANSMITTAL
(OR, IN THE CASE OF A NON-UNITED STATES PREFERRED SHAREHOLDER, FORM W-8
OBTAINABLE FROM THE DEPOSITARY) MAY BE SUBJECT TO REQUIRED FEDERAL INCOME TAX
BACKUP WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAYABLE TO SUCH PREFERRED
SHAREHOLDER PURSUANT TO THE OFFER OR, ALTERNATIVELY, THE SPECIAL CASH PAYMENT.
To prevent backup withholding, a United States Preferred Shareholder must
provide the Depositary with the Preferred Shareholder's correct taxpayer
identification number and certify that the Preferred Shareholder is not
subject to backup withholding of federal income tax by completing the
Substitute Form W-9 included in the applicable Letter of Transmittal. Certain
Preferred Shareholders (including, among others, all corporations and certain
foreign shareholders) are exempt from backup withholding. For a corporate
United States Preferred Shareholder to qualify for such exemption, such
Preferred Shareholder must provide the Depositary with a properly completed
and executed Substitute Form W-9 attesting to its exempt status. In order for
a Non-United States Preferred Shareholder to quality as an exempt recipient,
the Non-United States Preferred Shareholder must submit a Form W-8,
Certificate of Foreign Status, signed under penalties of perjury, attesting to
that Preferred Shareholder's exempt status. A copy of Form W-8 may be obtained
from the Depositary. Any amounts paid to Non-United States Preferred
Shareholders that are subject to the 31% backup withholding, will not be
subject to the 30% withholding tax discussed above under "Tax Considerations
for Non-Tendering Preferred Shareholders--Non-United States Preferred
Shareholders."
The amount of any backup withholding from a payment to a Preferred
Shareholder will be allowed as a credit against such Preferred Shareholder's
United States federal income tax liability and may entitle such Preferred
Shareholder to a refund, provided that the required information is furnished
to the IRS.
SOURCE AND AMOUNT OF FUNDS
Assuming that Conectiv purchases all outstanding Shares pursuant to the
Offer, the total amount required by Conectiv to purchase such Shares will be
approximately $30 million, including fees and other expenses. Conectiv intends
to fund the Offer through the use of its general funds (which, in the ordinary
course, include ordinary dividends from the Company) and funds borrowed
pursuant to Conectiv's credit facility.
As described under "Certain Information Regarding Conectiv and the Company,"
a Registration Statement is being filed with the Commission with respect to
the offering of trust preferred securities by Atlantic Capital II, the
proceeds of which will be invested in the Junior Subordinated Debentures to be
issued by the Company. The Company intends to finance the purchase of Shares
from Conectiv with the proceeds from the sale of the trust preferred
securities, which will be loaned by Atlantic Capital II to the Company. To the
extent that the proceeds of the proposed sale of the trust preferred
securities, if any, are not sufficient, the Company may issue commercial paper
or other debt to finance the purchase of Shares from Conectiv.
TRANSACTIONS AND AGREEMENTS CONCERNING THE SHARES
Based upon Conectiv's and the Company's records and upon information
provided to each of Conectiv and the Company by its directors and executive
officers, neither Conectiv, the Company nor, to the knowledge of either, any
of their subsidiaries, affiliates, directors or executive officers, or
associates of the foregoing, has engaged in any transactions involving Shares
during the 40 business days preceding the date hereof. Neither the Company
nor, to the knowledge of either, any of its directors or executive officers or
an associate of the foregoing, is a party to any contract, arrangement,
understanding or relationship relating directly or indirectly to the Offer
with any other person or entity with respect to any securities of the Company.
21
<PAGE>
FEES AND EXPENSES PAID TO DEALERS
Dealer Manager Fees. Morgan Stanley will act as Dealer Manager for Conectiv
in connection with the Offer. Conectiv has agreed to pay the Dealer Manager a
fee of an amount equal to $ 0.50 per Share for any Shares tendered, accepted
for payment and paid for pursuant to the Offer. The Dealer Manager will also
be reimbursed by Conectiv for certain reasonable out-of-pocket expenses and
will be indemnified against certain liabilities, including certain liabilities
under the federal securities laws, in connection with the Offer. The Dealer
Manager has rendered, is currently rendering and is expected to continue to
render various investment banking and other advisory services to Conectiv, the
Company and certain of its affiliates. The Dealer Manager has received, and
will continue to receive, customary compensation from Conectiv, the Company
and its affiliates for such services. Conectiv has retained The Bank of New
York as Depositary and D.F. King & Co., Inc. as Information Agent in
connection with the Offer. The Depositary and Information Agent will receive
reasonable and customary compensation for their services and will also be
reimbursed for reasonable out-of-pocket expenses, including attorney fees.
Neither the Depositary nor the Information Agent has been retained to make
solicitation or recommendations in connection with the Offer.
Solicited Tender Fees. Conectiv will pay a solicitation fee of an amount
equal to $ 1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
is an entity obtaining the tender, if the Letter of Transmittal and Proxy
shall include its name and it is (a) any broker or dealer in securities,
including the Dealer Manager in its capacity as a dealer or broker, which is a
member of any national securities exchange or of the NASD, (b) any foreign
broker or dealer not eligible for membership in the NASD which agrees to
conform to the NASD's Rules of Fair Practice in soliciting tenders outside the
United States to the same extent as though it were an NASD member, or (c) any
bank or trust company.
No such solicitation fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. Beneficial owners should review
Instruction 10 and complete the "Solicited Tenders" box in the accompanying
Letter of Transmittal and Proxy to designate a Soliciting Dealer. If tendered
Shares are being delivered by book-entry transfer, the Soliciting Dealer must
return a Notice of Solicited Tenders to the Depositary within three business
days after expiration of the Offer to receive a solicitation fee. No such fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer the amount of such fee to a depositing holder
(other than itself). No such fee shall be paid to a Soliciting Dealer with
respect to Shares tendered for such Soliciting Dealer's own account. No
broker, dealer, bank, trust company or fiduciary shall be deemed to be the
agent of Conectiv, the Company, the Depositary, the Information Agent or the
Dealer Manager for purposes of the Offer.
Soliciting Dealers will include any of the organizations described in
clauses (a), (b) and (c) above even when the activities of such organizations
in connection with the Offer consist solely of forwarding to clients
22
<PAGE>
materials relating to the Offer, including the Letter of Transmittal and
Proxy, and tendering Shares as directed by beneficial owners thereof. No
Soliciting Dealer is required to make any recommendation to holders of Shares
as to whether to tender or refrain from tendering in the Offer. No assumption
is made, in making payment to any Soliciting Dealer, that its activities in
connection with the Offer included any activities other than those described
above, and for all purposes noted in all materials relating to the Offer, the
term "solicit" shall be deemed to mean no more than "processing shares
tendered" or "forwarding to customers materials regarding the Offer."
Stock Transfer Taxes. Conectiv will pay all stock transfer taxes, if any,
payable on account of the acquisition of Shares by Conectiv pursuant to the
Offer, except in certain circumstances where special payment or delivery
procedures are utilized pursuant to Instruction 6 of the accompanying Letter
of Transmittal and Proxy.
CERTAIN INFORMATION REGARDING CONECTIV AND THE COMPANY
The Company is an operating utility primarily engaged in the generation,
transmission, distribution and sale of electric power to approximately 480,000
customers in the southern part of New Jersey. All of the common stock of the
Company is owned by Conectiv, a registered holding company under the Holding
Company Act. Conectiv also owns all of the outstanding common stock of
Delmarva Power & Light Company which is an operating public utility company
and other non-regulated energy-related businesses.
Conectiv and the Company are subject to the informational requirements of
the Exchange Act and in accordance therewith file reports and other
information with the Commission. Such reports and other information may be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549; 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661-2511; and Seven World Trade
Center, Suite 1300, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission, 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
maintains a Web site at http://www.sec.gov containing reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission, including Conectiv and the Company.
Reports, proxy materials and other information about Conectiv and the Company
are also available at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005. In connection with the Offer Conectiv has
filed an Issuer Tender Offer Statement on Schedule 13E-4 with the Commission
that includes certain additional information relating to the Offer. Conectiv's
Schedule 13E-4 will not be available at the Commission's regional offices.
The Company and Atlantic Capital II are filing a registration statement (the
"Registration Statement") with the Commission with respect to the proposed
offering of up to $30,000,000 aggregate liquidation amount of trust preferred
securities, guaranteed by the Company to the extent set forth in the
Registration Statement. Following the commencement of the Offer, and subject
to market and other conditions, the Company intends that Atlantic Capital II
will effect a public offering of trust preferred securities. As set forth in
"Source and Amount of Funds," the Company intends to finance the purchase of
Shares from Conectiv with the proceeds from the sale of the trust preferred
securities, which will be loaned by Atlantic Capital II to the Company. To the
extent that the proceeds of the proposed sale of the trust preferred
securities, if any, are not sufficient, the Company may issue commercial paper
or other debt to finance the purchase of Shares from Conectiv.
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<PAGE>
SUMMARY OF FINANCIAL INFORMATION
Set forth below is certain historical financial information of the Company.
The historical financial information (other than the ratios of earnings to
fixed charges) was derived from the audited financial statements included in
the Company's Annual Report on Form 10-K for the year ended December 31, 1997
and from the unaudited financial statements included in the Company's
Quarterly Report on Form 10-Q for the period ended June 30, 1998.
CONDENSED INCOME STATEMENT DATA
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, SIX MONTHS ENDED JUNE 30,
----------------------------------------------------
1997 1996 1998 1997
------------ ----------------------- ------------
(THOUSANDS OF DOLLARS, EXCEPT RATIOS)
(UNAUDITED)
<S> <C> <C> <C> <C>
Operating Revenues...... $1,084,890 $989,647 $479,831 $485,896
Operating Income........ 190,052 165,120 28,204 92,389
Net Income.............. 85,747 75,017 (1,424) 39,047
Dividends on Preferred
Stock.................. 4,821 9,904 2,000 2,820
Net Income after
Dividends on Preferred
Stock.................. 80,926 65,113 (3,424) 36,227
Ratio of Earnings to
Fixed Charges.......... 2.83 2.58 2.00(1) 2.83(1)
</TABLE>
- --------
(1) Ratio for the twelve months ended June 30.
CONDENSED BALANCE SHEET DATA
<TABLE>
<CAPTION>
AT DECEMBER 31, AT JUNE 30,
--------------------- ---------------------
1997 1996 1998 1997
---------- ---------- ---------- ----------
(THOUSANDS OF DOLLARS)
(UNAUDITED)
<S> <C> <C> <C> <C>
ASSETS:
Net Utility Plant In Service...... $1,651,051 $1,636,689 $1,602,210 $1,645,904
Construction Work in Progress..... 95,120 117,188 118,647 106,806
Cash and Cash Equivalents......... 5,640 7,927 21,095 20,765
Other Current Assets.............. 234,111 235,575 260,767 211,377
Other Assets...................... 450,833 463,362 427,307 451,903
---------- ---------- ---------- ----------
2,436,755 2,460,741 2,430,026 2,436,755
========== ========== ========== ==========
LIABILITIES:
Common Equity..................... $ 783,033 $ 778,425 $ 738,513 $ 783,033
Cumulative Preferred Stock (less
amounts due within one year)..... 63,950 73,950 53,950 63,950
Cumulative Quarterly Preferred
Securities....................... 70,000 70,000 70,000 70,000
Long-Term Debt (less amounts due
within one year)................. 833,744 802,245 819,327 833,744
Current Liabilities............... 181,880 231,010 278,017 206,854
Other Liabilities................. 504,148 505,111 470,219 479,174
---------- ---------- ---------- ----------
2,436,755 2,460,741 2,430,026 2,436,755
========== ========== ========== ==========
</TABLE>
The financial statements of Conectiv and related information included in its
Annual Report on Form 10-K for the year ended December 31, 1997, its Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1998 and June 30, 1998
and its Current Reports on Form 8-K dated March 6, 1998, March 9, 1998, April
23, 1998 and August 3, 1998, each as filed with the Commission, are hereby
incorporated by reference. The financial statements of the Company and related
information included in its Annual Report on Form 10-K for the year ended
December 31, 1997, its Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1998 and June 30, 1998 and its Current Reports on Form 8-K dated
February 27, 1998, March 3, 1998 and March 5, 1998, each
24
<PAGE>
as filed with the Commission, are hereby incorporated by reference. All
documents subsequently filed by Conectiv and the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Offer to
Purchase and Proxy Statement and prior to the Expiration Date (or any
extension thereof) shall be deemed to be incorporated by reference in this
Offer to Purchase and Proxy Statement and to be a part hereof from the date of
filing of such documents. Any statement contained in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Offer to Purchase and Proxy
Statement to the extent that a statement contained herein or in any other
subsequently filed document which is deemed to be incorporated by reference
herein modified or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Offer to Purchase and Proxy Statement.
Conectiv and the Company each will provide without charge to each person to
whom a copy of this Offer to Purchase and Proxy Statement has been delivered,
on the written or oral request of any such person, a copy of any or all of its
documents described above which have been incorporated by reference in this
Offer to Purchase and Proxy Statement, other than exhibits to such documents.
Such requests should be directed to Stephanie M. Scola, Manager of Capital
Markets, Conectiv, 800 King Street, P.O. Box 321, Wilmington, Delaware 19899,
telephone: (302) 429-3931. The information relating to Conectiv and the
Company contained in this Offer to Purchase and Proxy Statement does not
purport to be comprehensive and should be read together with the information
contained in the documents incorporated by reference.
MISCELLANEOUS
The Offer is not being made to, nor will Conectiv accept tenders from,
owners of Shares in any jurisdiction in which the Offer or its acceptance
would not be in compliance with the laws of such jurisdiction. Conectiv is not
aware of any jurisdiction where the making of the Offer or the tender of
Shares would not be in compliance with applicable law. If Conectiv becomes
aware of any jurisdiction where the making of the Offer or the tender of
Shares is not in compliance with any applicable law, Conectiv will make a good
faith effort to comply with such law. If, after such good faith effort,
Conectiv cannot comply with such law, the Offer will not be made to (nor will
tenders be accepted from or on behalf of) the owners of Shares residing in
such jurisdiction. In any jurisdiction in which the securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer will be deemed to be made on Conectiv's behalf by one or more registered
brokers or dealers licensed under the laws of such jurisdiction.
CONECTIV
ATLANTIC CITY ELECTRIC COMPANY
25
<PAGE>
Any questions or requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective telephone numbers and
addresses listed below. Requests for additional copies of this Offer to
Purchase and Proxy Statement, the Letter of Transmittal and Proxy or other
tender offer or proxy materials may be directed to the Information Agent, and
such copies will be furnished promptly at the Company's expense. Preferred
Shareholders may also contact their local broker, dealer, commercial bank or
trust company for assistance concerning the Offer.
The Dealer Manager:
MORGAN STANLEY DEAN WITTER
Liability Management Group
1585 Broadway, 2nd Floor
New York, New York 10036
(800) 624-1808 (toll free)
The Information Agent:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
Facsimile copies of the Letter of Transmittal and Proxy will not be
accepted. The Letter of Transmittal and Proxy and, if applicable, certificates
for Shares should be sent or delivered by each tendering or voting Preferred
Shareholder of the Company or his or her broker, dealer, bank or trust company
to the Depositary at one of its addresses set forth below.
The Depositary:
THE BANK OF NEW YORK
By Mail: By Hand or Overnight Courier:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
ATTENTION
SHAREHOLDERS WHO HAVE LOST CERTIFICATES:
Call ACE Stockholder Services
at (800) 365-6495 (toll free) for assistance
<PAGE>
EXHIBIT 99(a)(2)
4%
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 4% SERIES PREFERRED STOCK
CUSIP NUMBERS 048303200 AND 048303903
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $81.60 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
2
<PAGE>
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- -----------------------------------------------------------------------------
<CAPTION>
NUMBER OF SHARES NOT
TOTAL NUMBER OF TENDERED BUT AS TO
CERTIFICATE SHARES REPRESENTED BY NUMBER OF WHICH PROXIES GIVEN
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** ONLY
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: __________________________________________________________________, 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
4% SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OF
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: _________________________, 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: _________________________________________________________________ , 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D.F. KING
& CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR BANKS AND
BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the
6
<PAGE>
guaranteed delivery procedure set forth under the heading "Terms of the
Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. See Instruction 2. DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY
OR THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_] CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_] A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_] A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to
7
<PAGE>
purchase any and all of the outstanding shares (the "Shares") of the series of
preferred stock of Atlantic City Electric Company, a New Jersey corporation,
and direct utility subsidiary of Conectiv (the "Company"), shown on the first
page hereof as to which this Letter of Transmittal and Proxy is applicable
(the "Shares") at the purchase price per Share shown on the first page hereof,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated September 10, 1998
(the "Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal and Proxy (which as to the
Shares, together with the Offer to Purchase and Proxy Statement, constitutes
the "Offer"). PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO THE COMPANY'S
CERTIFICATE OF INCORPORATION, AS AMENDED, AS SET FORTH IN THE OFFER TO
PURCHASE AND PROXY STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS
CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH
DATE TO WHICH THE MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL MEETING").
See "Proposed Amendment and Proxy Solicitation," "Terms of the Offer--
Extension of Tender Period; Termination; Amendments" and "Terms of the Offer--
Certain Conditions of the Offer" in the Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares
8
<PAGE>
tendered hereby. In either event, the abovesigned understands that
certificate(s) for any Shares not tendered or not purchased will be returned
to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 6 AND 7) (SEE INSTRUCTIONS 4, 6 AND 7)
To be completed ONLY if the To be completed ONLY if the
check for the purchase price of check for the purchase price of
Shares purchased, the Shares purchased, the
certificates for Shares not certificates for Shares not
tendered or not purchased or the tendered or not purchased or the
check for the Special Cash check for the Special Cash
Payment are to be issued in the Payment are to be mailed to
name of someone other than the someone other than the
abovesigned. abovesigned or to the
abovesigned at an address other
Issue [_] Check and/or than that shown below the
[_] Certificate(s) to: abovesigned's signature(s).
Name ____________________________ Mail [_] Check and/or
(PLEASE PRINT) [_] Certificate(s) to:
Address _________________________ Name ____________________________
(PLEASE PRINT)
_________________________________
(INCLUDE ZIP CODE) Address _________________________
_________________________________ _________________________________
(TAXPAYER IDENTIFICATION OR (INCLUDE ZIP CODE)
SOCIAL SECURITY NUMBER)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_] CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
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COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Complete ONLY if customer's shares held in nominee name are tendered:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
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<PAGE>
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 4% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER SERIES OF
PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR SOLICITING
A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO THAT
SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: ____________________________________________________________________
SIGNATURE OF OWNER(S)
_______________________________________________________________________________
SIGNATURE OF OWNER(S)
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<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
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<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
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<PAGE>
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
United States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for
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<PAGE>
a number or intends to apply for a number in the near future. If the box in
Part 2 is checked and the Depositary is not provided with a TIN by the time of
payment, the Depositary will withhold 31% of the gross amount otherwise
payable thereafter until a TIN is provided to the Depositary.
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase and Proxy Statement, this Letter of
Transmittal and Proxy or other tender offer materials may be directed to the
Information Agent or the Dealer Manager and such copies will be furnished
promptly at Conectiv's expense. Preferred Shareholders may also contact their
local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
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<PAGE>
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and all tenders of Shares that it determines are not in proper
form or the acceptance for payment of or payment for Shares that may, in the
opinion of Conectiv's counsel, be unlawful. Conectiv also reserves the
absolute right to waive any of the conditions to the Offer or any defect or
irregularity in any tender of Shares and Conectiv's interpretation of the
terms and conditions of the Offer (including these instructions) shall be
final and binding. Unless waived, any defects or irregularities in connection
with tenders must be cured within such time as Conectiv shall determine. None
of Conectiv, the Company, the Dealer Manager, the Depositary, the Information
Agent or any other person shall be under any duty to give notice of any defect
or irregularity in tenders, nor shall any of them incur any liability for
failure to give any such notice. Tenders will not be deemed to have been made
until all defects and irregularities have been cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
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IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
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PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct taxpayer identification number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
I certify under penalties of perjury that a
taxpayer identification number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer
identification number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
18
<PAGE>
4.10%
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 4.10% SERIES PREFERRED STOCK
CUSIP NUMBER 048303770
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $83.50 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
2
<PAGE>
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- -----------------------------------------------------------------------------
<CAPTION>
NUMBER OF SHARES NOT
TOTAL NUMBER OF TENDERED BUT AS TO
CERTIFICATE SHARES REPRESENTED BY NUMBER OF WHICH PROXIES
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** GIVEN ONLY
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: _________________________________________________________________ , 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
4.10% SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OR
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: ________________________ , 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: _________________________________________________________________ , 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D.F. KING
& CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR BANKS AND
BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the
6
<PAGE>
guaranteed delivery procedure set forth under the heading "Terms of the
Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. See Instruction 2. DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY
OR THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_] CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_] A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_] A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to purchase any
and all of the outstanding shares (the "Shares") of the series of preferred
stock of Atlantic City
7
<PAGE>
Electric Company, a New Jersey corporation, and direct utility subsidiary of
Conectiv (the "Company"), shown on the first page hereof as to which this
Letter of Transmittal and Proxy is applicable (the "Shares") at the purchase
price per Share shown on the first page hereof, net to the seller in cash,
upon the terms and subject to the conditions set forth in the Offer to
Purchase and Proxy Statement, dated September 10, 1998 (the "Offer to Purchase
and Proxy Statement"), receipt of which is hereby acknowledged, and in this
Letter of Transmittal and Proxy (which as to the Shares, together with the
Offer to Purchase and Proxy Statement, constitutes the "Offer"). PREFERRED
SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER MUST VOTE
IN FAVOR OF THE PROPOSED AMENDMENT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION, AS AMENDED, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING OF
SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL MEETING"). See "Proposed
Amendment and Proxy Solicitation," "Terms of the Offer--Extension of Tender
Period; Termination; Amendments" and "Terms of the Offer--Certain Conditions
of the Offer" in the Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
8
<PAGE>
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares tendered hereby. In
either event, the abovesigned understands that certificate(s) for any Shares
not tendered or not purchased will be returned to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 6 AND 7) (SEE INSTRUCTIONS 4, 6 AND 7)
To be completed ONLY if the To be completed ONLY if the
check for the purchase price of check for the purchase price of
Shares purchased, the Shares purchased, the
certificates for Shares not certificates for Shares not
tendered or not purchased or the tendered or not purchased or the
check for the Special Cash check for the Special Cash
Payment are to be issued in the Payment are to be mailed to
name of someone other than the someone other than the
abovesigned. abovesigned or to the
abovesigned at an address other
Issue [_] Check and/or than that shown below the
[_] Certificate(s) to: abovesigned's signature(s).
Name ____________________________ Mail [_] Check and/or
(PLEASE PRINT) [_] Certificate(s) to:
Address _________________________ Name ____________________________
(PLEASE PRINT)
_________________________________
(INCLUDE ZIP CODE) Address _________________________
_________________________________ _________________________________
(TAXPAYER IDENTIFICATION OR (INCLUDE ZIP CODE)
SOCIAL SECURITY NUMBER)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_] CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
9
<PAGE>
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Complete ONLY if customer's shares held in nominee name are tendered:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
10
<PAGE>
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 4.10% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER SERIES OF
PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR SOLICITING
A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO THAT
SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: ____________________________________________________________________
SIGNATURE OF OWNER(S)
_______________________________________________________________________________
SIGNATURE OF OWNER(S)
11
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
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<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
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<PAGE>
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
United States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future. If the box in Part 2 is checked and
the Depositary is not provided with a TIN by the time of payment, the
Depositary will withhold 31% of the gross amount otherwise payable thereafter
until a TIN is provided to the Depositary.
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<PAGE>
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase and Proxy Statement, this Letter of
Transmittal and Proxy or other tender offer materials may be directed to the
Information Agent or the Dealer Manager and such copies will be furnished
promptly at Conectiv's expense. Preferred Shareholders may also contact their
local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and all tenders of Shares that it determines are not in proper
form or the acceptance for payment of or payment for
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<PAGE>
Shares that may, in the opinion of Conectiv's counsel, be unlawful. Conectiv
also reserves the absolute right to waive any of the conditions to the Offer
or any defect or irregularity in any tender of Shares and Conectiv's
interpretation of the terms and conditions of the Offer (including these
instructions) shall be final and binding. Unless waived, any defects or
irregularities in connection with tenders must be cured within such time as
Conectiv shall determine. None of Conectiv, the Company, the Dealer Manager,
the Depositary, the Information Agent or any other person shall be under any
duty to give notice of any defect or irregularity in tenders, nor shall any of
them incur any liability for failure to give any such notice. Tenders will not
be deemed to have been made until all defects and irregularities have been
cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
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<PAGE>
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
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<PAGE>
PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct taxpayer identification number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
I certify under penalties of perjury that a
taxpayer identification number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer
identification number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
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<PAGE>
4.35%
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 4.35% SERIES PREFERRED STOCK
CUSIP NUMBER 048303762
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $88.60 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
2
<PAGE>
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: _________________________________________________________________ , 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- -----------------------------------------------------------------------------
<CAPTION>
NUMBER OF SHARES NOT
TOTAL NUMBER OF TENDERED BUT AS TO
CERTIFICATE SHARES REPRESENTED BY NUMBER OF WHICH PROXIES GIVEN
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** ONLY
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: __________________________________________________________________, 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
4.35% SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OR
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: _________________________, 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: _________________________________________________________________ , 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D.F. KING
& CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR BANKS AND
BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the
6
<PAGE>
guaranteed delivery procedure set forth under the heading "Terms of the
Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. See Instruction 2. DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY
OR THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_]CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_]A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE
THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_]A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to
7
<PAGE>
purchase any and all of the outstanding shares (the "Shares") of the series of
preferred stock of Atlantic City Electric Company, a New Jersey corporation,
and direct utility subsidiary of Conectiv (the "Company"), shown on the first
page hereof as to which this Letter of Transmittal and Proxy is applicable
(the "Shares") at the purchase price per Share shown on the first page hereof,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated September 10, 1998
(the "Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal and Proxy (which as to the
Shares, together with the Offer to Purchase and Proxy Statement, constitutes
the "Offer"). PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO THE COMPANY'S
CERTIFICATE OF INCORPORATION, AS AMENDED, AS SET FORTH IN THE OFFER TO
PURCHASE AND PROXY STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS
CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH
DATE TO WHICH THE MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL MEETING").
See "Proposed Amendment and Proxy Solicitation," "Terms of the Offer--
Extension of Tender Period; Termination; Amendments" and "Terms of the Offer--
Certain Conditions of the Offer" in the Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
8
<PAGE>
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares tendered hereby. In
either event, the abovesigned understands that certificate(s) for any Shares
not tendered or not purchased will be returned to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL DELIVERY INSTRUCTIONS
SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 4, 6 AND 7)
(SEE INSTRUCTIONS 1, 4, 6 AND 7)
To be completed ONLY if the
To be completed ONLY if the check for the purchase price of
check for the purchase price of Shares purchased, the
Shares purchased, the certificates for Shares not
certificates for Shares not tendered or not purchased or the
tendered or not purchased or the check for the Special Cash
check for the Special Cash Payment are to be mailed to
Payment are to be issued in the someone other than the
name of someone other than the abovesigned or to the
abovesigned. abovesigned at an address other
than that shown below the
abovesigned's signature(s).
Issue[_] Check and/or
[_] Certificate(s) to:
Name ____________________________ Mail[_] Check and/or
(PLEASE PRINT) [_] Certificate(s) to:
Address _________________________ Name ____________________________
_________________________________ (PLEASE PRINT)
(INCLUDE ZIP CODE) Address _________________________
_________________________________ _________________________________
(TAXPAYER IDENTIFICATION OR (INCLUDE ZIP CODE)
SOCIAL SECURITY NUMBER)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_]CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
9
<PAGE>
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
COMPLETE ONLY IF CUSTOMER'S SHARES HELD IN NOMINEE NAME ARE TENDERED:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 4.35% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
10
<PAGE>
ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER SERIES OF
PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR SOLICITING
A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO THAT
SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: ____________________________________________________________________
SIGNATURE OF OWNER(S)
_______________________________________________________________________________
SIGNATURE OF OWNER(S)
11
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
12
<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
13
<PAGE>
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
United States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for
14
<PAGE>
a number or intends to apply for a number in the near future. If the box in
Part 2 is checked and the Depositary is not provided with a TIN by the time of
payment, the Depositary will withhold 31% of the gross amount otherwise
payable thereafter until a TIN is provided to the Depositary.
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase and Proxy Statement, this Letter of
Transmittal and Proxy or other tender offer materials may be directed to the
Information Agent or the Dealer Manager and such copies will be furnished
promptly at Conectiv's expense. Preferred Shareholders may also contact their
local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
15
<PAGE>
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and all tenders of Shares that it determines are not in proper
form or the acceptance for payment of or payment for Shares that may, in the
opinion of Conectiv's counsel, be unlawful. Conectiv also reserves the
absolute right to waive any of the conditions to the Offer or any defect or
irregularity in any tender of Shares and Conectiv's interpretation of the
terms and conditions of the Offer (including these instructions) shall be
final and binding. Unless waived, any defects or irregularities in connection
with tenders must be cured within such time as Conectiv shall determine. None
of Conectiv, the Company, the Dealer Manager, the Depositary, the Information
Agent or any other person shall be under any duty to give notice of any defect
or irregularity in tenders, nor shall any of them incur any liability for
failure to give any such notice. Tenders will not be deemed to have been made
until all defects and irregularities have been cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
16
<PAGE>
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
17
<PAGE>
PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct Taxpayer Identification Number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out Item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
I certify under penalties of perjury that a
Taxpayer Identification Number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a Taxpayer
Identification Number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
18
<PAGE>
4.35% 2ND SERIES
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 4.35% 2ND SERIES PREFERRED STOCK
CUSIP NUMBER 048303507
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $88.60 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
2
<PAGE>
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_]FOR [_]AGAINST [_]ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
_______________________________________________________________________________
X
_______________________________________________________________________________
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- --------------------------------------------------------------------------------
<CAPTION>
TOTAL NUMBER OF NUMBER OF SHARES NOT
CERTIFICATE SHARES REPRESENTED BY NUMBER OF TENDERED BUT AS TO WHICH
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** PROXIES GIVEN ONLY
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: __________________________________________________________________, 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
4.35% 2ND SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
---------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OF
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: _________________________, 1998 Date: _________________________, 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: __________________________________________________________________, 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D. F.
KING & CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR
BANKS AND BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer--Procedure for
Tendering
6
<PAGE>
Shares" in the Offer to Purchase and Proxy Statement. See Instruction 2.
DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY OR THE BOOK-ENTRY TRANSFER
FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_] CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_] A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
TO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_] A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_] A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to purchase any
and all of the outstanding shares (the "Shares") of the series of preferred
stock of Atlantic City
7
<PAGE>
Electric Company, a New Jersey corporation, and direct utility subsidiary of
Conectiv (the "Company"), shown on the first page hereof as to which this
Letter of Transmittal and Proxy is applicable (the "Shares") at the purchase
price per Share shown on the first page hereof, net to the seller in cash,
upon the terms and subject to the conditions set forth in the Offer to
Purchase and Proxy Statement, dated September 10, 1998 (the "Offer to Purchase
and Proxy Statement"), receipt of which is hereby acknowledged, and in this
Letter of Transmittal and Proxy (which as to the Shares, together with the
Offer to Purchase and Proxy Statement, constitutes the "Offer"). PREFERRED
SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER MUST VOTE
IN FAVOR OF THE PROPOSED AMENDMENT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION, AS AMENDED, AS SET FORTH IN THE OFFER TO PURCHASE AND PROXY
STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING OF
SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL MEETING"). See "Proposed
Amendment and Proxy Solicitation," "Terms of the Offer--Extension of Tender
Period; Termination; Amendments" and "Terms of the Offer--Certain Conditions
of the Offer" in the Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
8
<PAGE>
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares tendered hereby. In
either event, the abovesigned understands that certificate(s) for any Shares
not tendered or not purchased will be returned to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL DELIVERY INSTRUCTIONS
SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 4, 6 AND 7)
(SEE INSTRUCTIONS 1, 4, 6 AND 7)
To be completed ONLY if the
To be completed ONLY if the check for the purchase price of
check for the purchase price of Shares purchased, the
Shares purchased, the certificates for Shares not
certificates for Shares not tendered or not purchased or the
tendered or not purchased or the check for the Special Cash
check for the Special Cash Payment are to be mailed to
Payment are to be issued in the someone other than the
name of someone other than the abovesigned or to the
abovesigned. abovesigned at an address other
than that shown below the
Issue [_] Check and/or abovesigned's signature(s).
[_] Certificate(s) to:
Mail [_] Check and/or
Name ____________________________ [_] Certificate(s) to:
(PLEASE PRINT)
Name ____________________________
Address _________________________ (PLEASE PRINT)
_________________________________ Address _________________________
(INCLUDE ZIP CODE)
_________________________________
_________________________________ (INCLUDE ZIP CODE)
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NUMBER)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_] CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
9
<PAGE>
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $ 1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $ 1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Complete ONLY if customer's shares held in nominee name are tendered:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
10
<PAGE>
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 4.35% 2ND SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY
STATEMENT) ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER
SERIES OF PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR
SOLICITING A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO
THAT SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: ____________________________________________________________________
SIGNATURE OF OWNER(S)
_______________________________________________________________________________
SIGNATURE OF OWNER(S)
11
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
12
<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
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<PAGE>
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
United States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future. If the box in Part 2 is checked and
the Depositary is not provided with a TIN by the time of payment, the
Depositary will withhold 31% of the gross amount otherwise payable thereafter
until a TIN is provided to the Depositary.
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<PAGE>
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase and Proxy Statement, this Letter of
Transmittal and Proxy or other tender offer materials may be directed to the
Information Agent or the Dealer Manager and such copies will be furnished
promptly at Conectiv's expense. Preferred Shareholders may also contact their
local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and
15
<PAGE>
all tenders of Shares that it determines are not in proper form or the
acceptance for payment of or payment for Shares that may, in the opinion of
Conectiv's counsel, be unlawful. Conectiv also reserves the absolute right to
waive any of the conditions to the Offer or any defect or irregularity in any
tender of Shares and Conectiv's interpretation of the terms and conditions of
the Offer (including these instructions) shall be final and binding. Unless
waived, any defects or irregularities in connection with tenders must be cured
within such time as Conectiv shall determine. None of Conectiv, the Company,
the Dealer Manager, the Depositary, the Information Agent or any other person
shall be under any duty to give notice of any defect or irregularity in
tenders, nor shall any of them incur any liability for failure to give any
such notice. Tenders will not be deemed to have been made until all defects
and irregularities have been cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
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<PAGE>
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
17
<PAGE>
PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct taxpayer identification number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
I certify under penalties of perjury that a
taxpayer identification number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer
identification number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
18
<PAGE>
4.75%
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 4.75% SERIES PREFERRED STOCK
CUSIP NUMBER 048303309
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $96.75 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
2
<PAGE>
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- -----------------------------------------------------------------------------
<CAPTION>
NUMBER OF SHARES NOT
TOTAL NUMBER OF TENDERED BUT AS TO
CERTIFICATE SHARES REPRESENTED BY NUMBER OF WHICH PROXIES GIVEN
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** ONLY
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: __________________________________________________________________, 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
4.75% SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OR
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: ________________________ , 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: _________________________________________________________________ , 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D.F. KING
& CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR BANKS AND
BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the
6
<PAGE>
guaranteed delivery procedure set forth under the heading "Terms of the
Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement. See Instruction 2. DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY
OR THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_]CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_]A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE
THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_]A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to
7
<PAGE>
purchase any and all of the outstanding shares (the "Shares") of the series of
preferred stock of Atlantic City Electric Company, a New Jersey corporation,
and direct utility subsidiary of Conectiv (the "Company"), shown on the first
page hereof as to which this Letter of Transmittal and Proxy is applicable
(the "Shares") at the purchase price per Share shown on the first page hereof,
net to the seller in cash, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Proxy Statement, dated September 10, 1998
(the "Offer to Purchase and Proxy Statement"), receipt of which is hereby
acknowledged, and in this Letter of Transmittal and Proxy (which as to the
Shares, together with the Offer to Purchase and Proxy Statement, constitutes
the "Offer"). PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES PURSUANT
TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT TO THE COMPANY'S
CERTIFICATE OF INCORPORATION, AS AMENDED, AS SET FORTH IN THE OFFER TO
PURCHASE AND PROXY STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS
CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH
DATE TO WHICH THE MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL MEETING").
See "Proposed Amendment and Proxy Solicitation," "Terms of the Offer--
Extension of Tender Period; Termination; Amendments" and "Terms of the Offer--
Certain Conditions of the Offer" in the Offer to Purchase and Proxy Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
8
<PAGE>
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares tendered hereby. In
either event, the abovesigned understands that certificate(s) for any Shares
not tendered or not purchased will be returned to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL DELIVERY INSTRUCTIONS
SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 4, 6 AND 7)
(SEE INSTRUCTIONS 1, 4, 6 AND 7)
To be completed ONLY if the
To be completed ONLY if the check for the purchase price of
check for the purchase price of Shares purchased, the
Shares purchased, the certificates for Shares not
certificates for Shares not tendered or not purchased or the
tendered or not purchased or the check for the Special Cash
check for the Special Cash Payment are to be mailed to
Payment are to be issued in the someone other than the
name of someone other than the abovesigned or to the
abovesigned. abovesigned at an address other
than that shown below the
abovesigned's signature(s).
Issue[_] Check and/or
[_] Certificate(s) to:
Name ____________________________ Mail[_] Check and/or
(PLEASE PRINT) [_] Certificate(s) to:
Address _________________________ Name ____________________________
_________________________________ (PLEASE PRINT)
(INCLUDE ZIP CODE) Address _________________________
_________________________________ _________________________________
(TAXPAYER IDENTIFICATION OR (INCLUDE ZIP CODE)
SOCIAL SECURITY NUMBER)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_]CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
9
<PAGE>
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $ 1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $ 1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Complete ONLY if customer's shares held in nominee name are tendered:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 4.75% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
10
<PAGE>
ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER SERIES OF
PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR SOLICITING
A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO THAT
SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: __________________________________________________________________
SIGNATURE OF OWNER(S)
- -------------------------------------------------------------------------------
SIGNATURE OF OWNER(S)
11
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
12
<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written one the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
13
<PAGE>
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
United States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future. If the box in Part 2 is checked and
the Depositary is not provided with a TIN by the time of payment, the
Depositary will withhold 31% of the gross amount otherwise payable thereafter
until a TIN is provided to the Depositary.
14
<PAGE>
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers and addresses listed below. Requests for
additional copies of the Offer to Purchase and Proxy Statement, this Letter of
Transmittal and Proxy or other tender offer materials may be directed to the
Information Agent or the Dealer Manager and such copies will be furnished
promptly at Conectiv's expense. Preferred Shareholders may also contact their
local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and
15
<PAGE>
all tenders of Shares that it determines are not in proper form or the
acceptance for payment of or payment for Shares that may, in the opinion of
Conectiv's counsel, be unlawful. Conectiv also reserves the absolute right to
waive any of the conditions to the Offer or any defect or irregularity in any
tender of Shares and Conectiv's interpretation of the terms and conditions of
the Offer (including these instructions) shall be final and binding. Unless
waived, any defects or irregularities in connection with tenders must be cured
within such time as Conectiv shall determine. None of Conectiv, the Company,
the Dealer Manager, the Depositary, the Information Agent or any other person
shall be under any duty to give notice of any defect or irregularity in
tenders, nor shall any of them incur any liability for failure to give any
such notice. Tenders will not be deemed to have been made until all defects
and irregularities have been cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
16
<PAGE>
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
17
<PAGE>
PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct taxpayer identification number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER:
I certify under penalties of perjury that a
taxpayer identification number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer
identification number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
18
<PAGE>
5%
LETTER OF TRANSMITTAL AND PROXY
TO ACCOMPANY
SHARES OF 5% SERIES PREFERRED STOCK
CUSIP NUMBER 048303788
OF
ATLANTIC CITY ELECTRIC COMPANY
----------------
TENDERED PURSUANT TO THE OFFER TO PURCHASE FOR CASH
BY
CONECTIV
DATED SEPTEMBER 10, 1998, FOR PURCHASE AT A
PURCHASE PRICE OF $100.00 PER SHARE
AND/OR
VOTED PURSUANT TO THE PROXY STATEMENT OF
ATLANTIC CITY ELECTRIC COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED
THE PROXY CONTAINED IN THIS DOCUMENT IS IN RESPECT OF THE SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE
MEETING IS ADJOURNED OR POSTPONED.
TO: THE BANK OF NEW YORK, DEPOSITARY
BY MAIL: BY HAND OR OVERNIGHT COURIER:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) AND ADDRESS(ES) APPEAR(S) ON CERTIFICATE(S))
- --------------------------------------------------------------------------------
<PAGE>
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE OFFER TO PURCHASE AND PROXY
STATEMENT OR OTHER DOCUMENTS PERTAINING TO THE OFFER OR NEED ASSISTANCE IN
COMPLETING THIS LETTER OF TRANSMITTAL AND PROXY, PLEASE CONTACT D.F. KING &
CO., INC., THE INFORMATION AGENT, AT TELEPHONE (800) 431-9629 (TOLL FREE).
PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES
SUBSEQUENT TO THE RECORD DATE) WILL NOT BE ABLE TO VALIDLY TENDER THEIR SHARES
UNLESS THEY HAVE SUBMITTED A DULY COMPLETED, VALID AND UNREVOKED PROXY
INDICATING THEIR VOTE FOR THE PROPOSED AMENDMENT OR INDICATE IN THE
ACCOMPANYING PROXY THEIR INTENTION TO VOTE FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING. CONECTIV ("CONECTIV") WILL NOT BE REQUIRED TO ACCEPT FOR
PAYMENT OR PAY FOR ANY SHARES TENDERED IF THE PROPOSED AMENDMENT IS NOT
APPROVED AND ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
OCTOBER 14, 1998, OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR
POSTPONED (THE "SPECIAL MEETING"). PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THIS LETTER OF
TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING. IF THE
PROPOSED AMENDMENT IS APPROVED AND ADOPTED, ATLANTIC CITY ELECTRIC COMPANY
(THE "COMPANY") WILL MAKE A SPECIAL CASH PAYMENT TO EACH PREFERRED SHAREHOLDER
WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH HOLDER'S
SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
HOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED AFTER THE
CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO WISH TO
TENDER IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO RECEIVE A DULY
COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM OF AN
IRREVOCABLE ASSIGNMENT OF PROXY AS SET FORTH IN THIS LETTER OF TRANSMITTAL AND
PROXY) FROM THE HOLDER OF RECORD OF SUCH SHARES ON THE RECORD DATE. IN ORDER
TO FACILITATE RECEIPT OF PROXIES, SHARES SHALL, DURING THE PERIOD WHICH
COMMENCES SEPTEMBER 10, 1998 (TWO BUSINESS DAYS PRIOR TO THE RECORD DATE) AND
WHICH WILL END AT THE CLOSE OF BUSINESS ON THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE AND PROXY STATEMENT), TRADE IN THE OVER-THE-COUNTER
MARKET WITH A PROXY PROVIDING THE TRANSFEREE WITH THE RIGHT TO VOTE SUCH
ACQUIRED SHARES IN THE PROXY SOLICITATION.
NOTE: SIGNATURES MUST BE PROVIDED HEREIN. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them, as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the Company which the undersigned is entitled to vote at
the Special Meeting or any adjournment(s) or postponement(s) thereof.
NOTE: IF YOU ARE VOTING BUT NOT TENDERING SHARES, DO NOT SEND ANY SHARE
CERTIFICATES WITH THIS LETTER OF TRANSMITTAL AND PROXY.
THIS LETTER OF TRANSMITTAL AND PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF THE COMPANY. The proxy contained herein, when properly executed,
will be voted in the manner described herein by the undersigned
shareholder(s). If no direction is made, the proxy will be voted FOR ITEM 1.
AN ABSTENTION IS THE EQUIVALENT OF A VOTE AGAINST the Proposed Amendment.
PREFERRED SHAREHOLDERS WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR ITEM 1.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
2
<PAGE>
ITEM 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
To remove from the Company's charter Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY. IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
MEETING.
Any holder of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificates or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5.)
3
<PAGE>
PLEASE COMPLETE:
DESCRIPTION OF SHARES TENDERED
(IF TENDERING SHARES, PLEASE FILL IN EXACTLY AS INFORMATION APPEARS ON
CERTIFICATE(S))
(ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
<TABLE>
- -----------------------------------------------------------------------------
<CAPTION>
NUMBER OF SHARES NOT
TOTAL NUMBER OF TENDERED BUT AS TO
CERTIFICATE SHARES REPRESENTED BY NUMBER OF WHICH PROXIES GIVEN
NUMBER(S)* CERTIFICATE(S)* SHARES TENDERED** ONLY
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares represented
by any certificates delivered to the Depositary are being tendered. See
Instruction 4. You must vote for the Proposed Amendment with respect to any
Shares tendered.
If any of your certificate(s) for Shares have been lost, stolen or
destroyed, please call the Company's shareholder services department ("ACE
Stockholder Services") at 800-365-6495 (toll free). You may need to complete
an Affidavit of Loss with respect to the lost certificate(s) (which will be
provided by ACE Stockholder Services) and payment of an indemnity bond premium
fee may be required.
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5)
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Name of Firm: _________________________________________________________________
Address of Firm: ______________________________________________________________
Area Code and Telephone No.: __________________________________________________
Dated: _________________________________________________________________ , 1998
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
5% SERIES CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in this Letter of Transmittal and Proxy will constitute a binding
agreement between the undersigned and the Company upon the terms and subject
to the conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
Total: ______________________________
_____________________________________ _____________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OR
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _____________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: _________________________, 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5.
Name: _________________________________________________________________________
(PLEASE PRINT)
Capacity: _____________________________________________________________________
(FULL TITLE)
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Tel. No. ________________________________________________________
PLEASE COMPLETE IF APPLICABLE:
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: __________________________________________________________________, 1998
DELIVERY OF THIS LETTER OF TRANSMITTAL AND PROXY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS
LETTER OF TRANSMITTAL AND PROXY IN THE APPROPRIATE SPACE THEREFOR PROVIDED
AND, IF YOU ARE TENDERING ANY SHARES OR VOTING IN FAVOR OF THE PROPOSED
AMENDMENT, COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW OR A FORM W-8, AS
APPLICABLE. SEE INSTRUCTION 8 AND "IMPORTANT TAX INFORMATION" BELOW.
DO NOT SEND ANY CERTIFICATES TO MORGAN STANLEY DEAN WITTER, D. F. KING &
CO., INC., CONECTIV, ACE STOCKHOLDER SERVICES OR ATLANTIC CITY ELECTRIC
COMPANY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL AND PROXY SHOULD BE
READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL AND PROXY IS COMPLETED.
QUESTIONS REGARDING AND REQUESTS FOR COPIES OF THE OFFER TO PURCHASE AND PROXY
STATEMENT OR THIS LETTER OF TRANSMITTAL AND PROXY MAY BE DIRECTED TO D.F. KING
& CO., INC., THE INFORMATION AGENT, AT (800) 431-9629 (TOLL FREE) OR BANKS AND
BROKERS CALL (212) 269-5550.
This Letter of Transmittal and Proxy is to be used (a) if Shares are to be
voted but not tendered, or (b) if certificates for Shares are to be forwarded
to The Bank of New York ("Depositary") or (c) if delivery of tendered Shares
(as defined below) is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company ("DTC" or the "Book-Entry Transfer
Facility") pursuant to the procedures set forth under the heading "Terms of
the Offer--Procedure for Tendering Shares" in the Offer to Purchase and Proxy
Statement (as defined below) and an Agent's Message (as defined below) is not
delivered.
Preferred Shareholders who wish to tender Shares but who cannot deliver
their Shares and all other documents required hereby to the Depositary by the
Expiration Date must tender their Shares pursuant to the guaranteed delivery
procedure set forth under the heading "Terms of the Offer--Procedure for
Tendering
6
<PAGE>
Shares" in the Offer to Purchase and Proxy Statement. See Instruction 2.
DELIVERY OF DOCUMENTS TO CONECTIV, THE COMPANY OR THE BOOK-ENTRY TRANSFER
FACILITY DOES NOT CONSTITUTE A VALID DELIVERY.
[_]CHECK HERE IF TENDERED SHARES ARE ENCLOSED HEREWITH.
A Holder tendering Shares pursuant to this Letter of Transmittal and Proxy
must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is included herein.
[_]A vote FOR the Proposed Amendment will be cast at the Special Meeting.
ELIGIBLE INSTITUTIONS OR BROKERS TO COMPLETE ONLY IF APPLICABLE:
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO
THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE
THE FOLLOWING:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY AND PROXY PREVIOUSLY SENT TO THE DEPOSITARY AND
COMPLETE THE FOLLOWING:
Name(s) of tendering shareholder(s) _________________________________
Date of execution of Notice of Guaranteed Delivery and Proxy ________
Name of institution that guaranteed delivery ________________________
If delivery is by book-entry transfer:
Name of tendering institution _______________________________________
Account No. at DTC __________________________________________________
Transaction Code No. ________________________________________________
A holder electing to tender Shares pursuant to a Notice of Guaranteed
Delivery and Proxy must check one of the following boxes:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment was included with the Notice of Guaranteed Delivery and
Proxy previously sent to the Depositary.
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is being delivered pursuant to a Notice of Guaranteed
Delivery and Proxy previously sent to the Depositary.
[_]A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
NOTE: SIGNATURES MUST BE PROVIDED ABOVE.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The abovesigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), the shares in the amount set forth in the box above designated
"Description of Shares Tendered" pursuant to Conectiv's offer to purchase any
and all of the outstanding shares (the "Shares") of the series of preferred
stock of Atlantic City Electric Company, a New Jersey corporation, and direct
utility subsidiary of Conectiv (the "Company"), shown
7
<PAGE>
on the first page hereof as to which this Letter of Transmittal and Proxy is
applicable (the "Shares") at the purchase price per Share shown on the first
page hereof, net to the seller in cash, upon the terms and subject to the
conditions set forth in the Offer to Purchase and Proxy Statement, dated
September 10, 1998 (the "Offer to Purchase and Proxy Statement"), receipt of
which is hereby acknowledged, and in this Letter of Transmittal and Proxy
(which as to the Shares, together with the Offer to Purchase and Proxy
Statement, constitutes the "Offer"). PREFERRED SHAREHOLDERS WHO WISH TO TENDER
THEIR SHARES PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION, AS AMENDED, AS SET
FORTH IN THE OFFER TO PURCHASE AND PROXY STATEMENT (THE "PROPOSED AMENDMENT").
THE OFFER IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND
ADOPTED AT THE SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 1998,
OR ON SUCH DATE TO WHICH THE MEETING IS ADJOURNED OR POSTPONED (THE "SPECIAL
MEETING"). See "Proposed Amendment and Proxy Solicitation," "Terms of the
Offer--Extension of Tender Period; Termination; Amendments" and "Terms of the
Offer--Certain Conditions of the Offer" in the Offer to Purchase and Proxy
Statement.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of any such extension or amendment), the abovesigned
hereby sells, assigns and transfers to, or upon the order of, Conectiv all
right, title and interest in and to all the Shares that are being tendered
hereby and hereby constitutes and appoints The Bank of New York (the
"Depositary") the true and lawful agent and attorney-in-fact of the
abovesigned with respect to such Shares, with full power of substitution (such
power of attorney being an irrevocable power coupled with an interest), to (a)
deliver certificates for such Shares, or transfer ownership of such Shares on
the account books maintained by the Book-Entry Transfer Facility, together, in
any such case, with all accompanying evidences of transfer and authenticity,
to or upon the order of Conectiv, (b) present such Shares for registration and
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, all in
accordance with the terms of the Offer. The Depositary will act as agent for
tendering shareholders for the purpose of receiving payment from Conectiv and
transmitting payment to tendering shareholders.
The abovesigned hereby represents and warrants that the abovesigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and that, when and to the extent the same are accepted for payment by
Conectiv, Conectiv will acquire good, marketable and unencumbered title
thereto, free and clear of all liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the same will not be subject to any adverse claims. The
abovesigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or Conectiv to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death, bankruptcy or incapacity of the
abovesigned, and any obligations of the abovesigned hereunder shall be binding
upon the heirs, legal representatives, successors, assigns, executors and
administrators of the abovesigned. Except as stated in the Offer, this tender
is irrevocable.
The abovesigned understands that tenders of Shares pursuant to any one of
the procedures described under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and in the
instructions hereto will constitute the abovesigned's acceptance of the terms
and conditions of the Offer, including the abovesigned's representation and
warranty that (a) the abovesigned has a net long position in the Shares being
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (b) the tender of such Shares complies
with such Rule 14e-4. Conectiv's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between the
abovesigned and Conectiv upon the terms and subject to the conditions of the
Offer.
The abovesigned recognizes that, under certain circumstances set forth in
the Offer to Purchase and Proxy Statement, Conectiv may terminate or amend the
Offer or may not be required to purchase any of the Shares
8
<PAGE>
tendered hereby. In either event, the abovesigned understands that
certificate(s) for any Shares not tendered or not purchased will be returned
to the abovesigned.
Unless otherwise indicated in the box below under the heading "Special
Payment Instructions," please issue the check for the purchase price of any
Shares purchased, and/or return any Shares not tendered or not purchased, in
the name(s) of the abovesigned (and, in the case of Shares tendered by book-
entry transfer, by credit to the account of the abovesigned at the Book-Entry
Transfer Facility). Similarly, unless otherwise indicated in the box below
under the heading "Special Delivery Instructions," please mail the check for
the purchase price of any Shares purchased and/or any certificate for Shares
not tendered or not purchased (and accompanying documents, as appropriate) to
the abovesigned at the address shown below the abovesigned's signature(s). In
the event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any Shares purchased and/or return any Shares not tendered or not purchased in
the name(s) of, and mail said check and/or any certificates to, the person(s)
so indicated. The abovesigned recognizes that Conectiv has no obligation,
pursuant to the "Special Payment Instructions," to transfer any Shares from
the name of the registered holder(s) thereof if Conectiv does not accept for
purchase any of the Shares so tendered.
COMPLETE ONLY IF APPLICABLE:
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 6 AND 7)
(SEE INSTRUCTIONS 4, 6 AND 7)
To be completed ONLY if the To be completed ONLY if the
check for the purchase price of check for the purchase price of
Shares purchased, the Shares purchased, the
certificates for Shares not certificates for Shares not
tendered or not purchased or the tendered or not purchased or the
check for the Special Cash check for the Special Cash
Payment are to be issued in the Payment are to be mailed to
name of someone other than the someone other than the
abovesigned. abovesigned or to the
abovesigned at an address other
than that shown below the
abovesigned's signature(s).
Issue[_] Check and/or
[_] Certificate(s) to:
Name ____________________________
(PLEASE PRINT) Mail[_] Check and/or
Address _________________________ [_] Certificate(s) to:
_________________________________ Name ____________________________
(INCLUDE ZIP CODE) (PLEASE PRINT)
_________________________________ Address _________________________
(TAXPAYER IDENTIFICATION OR _________________________________
SOCIAL SECURITY NUMBER) (INCLUDE ZIP CODE)
COMPLETE ONLY IF YOUR SHARES ARE LOST:
LOST CERTIFICATES BOX
[_]CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU
OWN AND WISH TO TENDER HAVE BEEN LOST, DESTROYED OR STOLEN. (SEE
INSTRUCTION 12.)
Number of Shares represented by lost, destroyed or stolen
certificates: _______________________________________________________
9
<PAGE>
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS AND PROXIES
(SEE INSTRUCTION 10)
As provided in Instruction 10, Conectiv will pay a solicitation fee of an
amount equal to $1.50 per Share for any Shares tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). However, Soliciting Dealers will
not be entitled to a solicitation fee for Shares beneficially owned by such
Soliciting Dealer.
The undersigned represents that the Soliciting Dealer which solicited and
obtained this tender is:
Name of Firm: _________________________________________________________________
(PLEASE PRINT)
Name of Individual Broker or Financial Consultant: ____________________________
Telephone Number of Broker or Financial Consultant: ___________________________
Identification Number (if known): _____________________________________________
Address: ______________________________________________________________________
(INCLUDE ZIP CODE)
Complete ONLY if customer's shares held in nominee name are tendered:
NAME OF BENEFICIAL OWNER NUMBER OF SHARES TENDERED
(ATTACH ADDITIONAL LIST IF NECESSARY)
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
The acceptance of compensation by such Soliciting Dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder, in connection with such solicitation; (b) it is
entitled to such compensation for such solicitation under the terms and
conditions of the Offer to Purchase and Proxy Statement; (c) in soliciting
tenders of Shares, it has used no solicitation materials other than those
furnished by Conectiv or the Company; and (d) if it is a foreign broker or
dealer not eligible for membership in the National Association of Securities
Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's Rules of
Fair Practice in making solicitations.
The payment of compensation to any Soliciting Dealer is dependent on such
Soliciting Dealer returning a Notice of Solicited Tenders to the Depositary.
10
<PAGE>
THIS LETTER OF TRANSMITTAL AND PROXY IS TO BE USED FOR THE TENDER OF SHARES
OF THE 5% SERIES (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
ONLY. ANY PERSON DESIRING TO TENDER OR VOTE SHARES OF ANY OTHER SERIES OF
PREFERRED STOCK FOR WHICH CONECTIV IS MAKING A TENDER OFFER AND/OR SOLICITING
A PROXY MUST SUBMIT A LETTER OF TRANSMITTAL AND PROXY RELATING TO THAT
SPECIFIC SERIES.
PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW OR A FORM W-8, AS APPLICABLE.
SIGN HERE: ____________________________________________________________________
SIGNATURE OF OWNER(S)
- -------------------------------------------------------------------------------
SIGNATURE OF OWNER(S)
11
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal and Proxy must be guaranteed by a
firm that is a member of a registered national securities exchange or the
NASD, or by a commercial bank or trust company having an office or
correspondent in the United States which is a participant in an approved
Medallion Signature Guarantee Program (each of the foregoing being referred to
as an "Eligible Institution"). Signatures on this Letter of Transmittal and
Proxy need not be guaranteed (a) if this Letter of Transmittal and Proxy is
signed by the registered holder(s) of the Shares (which term, for purposes of
this document, shall include any participant in the Book-Entry Transfer
Facility whose name appears on a security position listing as the owner of
Shares) tendered herewith and such holder(s) has not completed the box above
under the heading "Special Payment Instructions" or the box above under the
heading "Special Delivery Instructions" on this Letter of Transmittal and
Proxy, (b) if such Shares are tendered for the account of an Eligible
Institution or (c) if this Letter of Transmittal and Proxy is being used
solely for the purpose of voting Shares which are not being tendered pursuant
to the Offer. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PROXY AND SHARES. This Letter of
Transmittal and Proxy is to be used if (a) certificates are to be forwarded
herewith, (b) delivery of Shares to be made by book-entry transfer pursuant to
the procedures set forth under the heading "Terms of the Offer--Procedure for
Tendering Shares" in the Offer to Purchase and Proxy Statement and as Agent's
Message (as defined below) is not delivered or (c) Shares are being voted in
connection with the Offer. Certificates for all physically delivered Shares,
or a confirmation of a book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal and
Proxy, and any other documents required by this Letter of Transmittal and
Proxy, must be received by the Depositary at one of its addresses set forth on
the front page of this Letter of Transmittal and Proxy on or prior to the
Expiration Date (as defined in the Offer to Purchase and Proxy Statement) with
respect to all Shares. Preferred Shareholders who wish to tender their Shares
yet who cannot deliver their Shares and all other required documents to the
Depositary on or prior to the Expiration Date must tender their Shares
pursuant to the guaranteed delivery procedure set forth under the heading
"Terms of the Offer--Procedure for Tendering Shares" in the Offer to Purchase
and Proxy Statement. Pursuant to such procedure: (a) such tender must be made
by or through an Eligible Institution, (b) a properly completed and duly
executed Notice of Guaranteed Delivery and Proxy in the form provided by
Conectiv (with any required signature guarantees) must be received by the
Depositary on or prior to the Expiration Date and (c) the certificates for all
physically delivered Shares, or a confirmation of a book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility of all Shares
delivered electronically, together with a properly completed and duly executed
Letter of Transmittal and Proxy, and any other documents required by this
Letter of Transmittal and Proxy, must be received by the Depositary by 5:00
p.m. (New York City time) within three New York Stock Exchange trading days
after the date of execution of such Notice of Guaranteed Delivery and Proxy,
all as provided under the heading "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. Tenders by book-entry
transfer may also be made by delivering an Agent's Message in lieu of this
Letter of Transmittal and Proxy. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility, received by the Depositary
and forming a part of the book-entry transfer when a tender is initiated,
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from a participant tendering Shares that such participant has
received and agrees to be bound by the terms of this Letter of Transmittal and
Proxy and that Conectiv may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING PREFERRED SHAREHOLDER. IF CERTIFICATES FOR
SHARES ARE SENT BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED,
PROPERLY INSURED, IS RECOMMENDED.
No alternative, conditional or contingent tenders will be accepted. See
"Terms of the Offer--Number of Shares; Purchase Prices; Expiration Date;
Dividends" in the Offer to Purchase and Proxy Statement. By
12
<PAGE>
executing this Letter of Transmittal and Proxy, the tendering shareholder
waives any right to receive any notice of the acceptance for payment of the
Shares.
3. VOTING. PREFERRED SHAREHOLDERS (INCLUDING PREFERRED SHAREHOLDERS WHO
ACQUIRE SHARES SUBSEQUENT TO THE RECORD DATE) WHO WISH TO TENDER THEIR SHARES
PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. THE OFFER
IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE
SPECIAL MEETING. In addition, Preferred Shareholders have the right to vote
for the Proposed Amendment regardless of whether they tender their Shares by
casting their vote and duly executing this Letter of Transmittal and Proxy or
by voting in person at the Special Meeting. By executing a Notice of
Guaranteed Delivery and Proxy, a Preferred Shareholder is deemed to have
tendered the Shares described in such Notice of Guaranteed Delivery and Proxy
and to have voted such Shares in accordance with the proxy contained therein.
If no vote is indicated on an otherwise properly executed proxy contained with
this Letter of Transmittal and Proxy (or within a Notice of Guaranteed
Delivery and Proxy), then all Shares in respect of such proxy will be voted in
favor of the Proposed Amendment. See "Proposed Amendment and Proxy
Solicitation" in the Offer to Purchase and Proxy Statement. The Offer is being
sent to all persons in whose names Shares are registered on the books of the
Company on the Record Date and transferees thereof. Preferred Shareholders who
purchase or whose purchase is registered after the Record Date and who wish to
tender in the Offer must arrange with their seller to receive a proxy from the
holder of record of such Shares on the Record Date. Any holder of Shares held
of record on the Record Date in the name of another must establish to the
satisfaction of the Company his entitlement to exercise or transfer such
Proxy. This will ordinarily require an assignment by such record holder in
blank or, if not in blank, to and from each successive transferee, including
the holder, with each signature guaranteed by an Eligible Institution. See
Instruction 5. In order to facilitate receipt of proxies, Shares shall, during
the period which commences on September 10, 1998 (two business days prior to
the Record Date) and which will end at the close of business on the Expiration
Date, trade in the over-the-counter market with a proxy providing the
transferee with the right to vote such acquired Shares in the Proxy
Solicitation. No record date is fixed for determining which persons are
permitted to tender Shares. However, only the holders of record, or holders
who acquire an assignment of proxy from such holders, are permitted to vote
for the Proposed Amendment and thereby validly tender Shares pursuant to the
Offer. Any person who is the beneficial owner but not the record holder of
Shares must arrange for the record transfer of such Shares prior to tendering
or direct the record holder to tender on behalf of the beneficial owner.
4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box above under the heading "Description of
Shares Tendered." In such case, a new certificate for the remainder of the
Shares represented by the old certificate will be sent to the person(s)
signing this Letter of Transmittal and Proxy, unless otherwise provided in the
box above under the heading "Special Payment Instructions" or "Special
Delivery Instructions," as promptly as practicable following the expiration or
termination of the Offer. All Shares represented by certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise
indicated.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL AND PROXY AND/OR NOTICE OF
GUARANTEED DELIVERY AND PROXY; STOCK POWERS AND ENDORSEMENTS. If either this
Letter of Transmittal and Proxy or the Notice of Guaranteed Delivery and Proxy
(together, the "Tender and Proxy Documents") is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond with
the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the Shares tendered or voted under either Tender and Proxy
Document are held of record by two or more persons, all such persons must sign
such Tender and Proxy Document.
If any of the Shares tendered or voted under either Tender and Proxy
Document are registered in different names or different certificates, it will
be necessary to complete, sign and submit as many separate applicable Tender
and Proxy Documents as there are different registrations or certificates.
13
<PAGE>
If either Tender and Proxy Document is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of certificates or separate stock
powers are required unless payment of the purchase price is to be made to, or
Shares not tendered or not purchased are to be registered in the name of, any
person other than the registered holder(s). Signatures on any such
certificates or stock powers must be guaranteed by an Eligible Institution.
See Instruction 1.
If this Letter of Transmittal and Proxy is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates must be
endorsed or accompanied by appropriate stock powers, in either case, signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificates for such Shares. Signature(s) on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If either Tender and Proxy Document or any certificate or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, such person should so indicate when signing, and
proper evidence satisfactory to Conectiv of the authority of such person so to
act must be submitted.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Conectiv
will pay or cause to be paid any stock transfer taxes with respect to the sale
and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price is to be made to, or Shares not
tendered or not purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered Shares are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal and Proxy, the amount of any stock transfer taxes (whether imposed
on the registered holder(s), such other person or otherwise) payable on
account of the transfer to such person will be deducted from the purchase
price unless satisfactory evidence of the payment of such taxes, or exemption
therefrom, is submitted. See "Terms of the Offer--Acceptance of Shares for
Payment and Payment of Purchase Price and Dividends" in the Offer to Purchase
and Proxy Statement. EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE
NECESSARY TO AFFIX TRANSFER TAX STAMPS TO THE CERTIFICATES REPRESENTING SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the purchase
price of any Shares purchased is to be issued in the name of, any Shares not
tendered or not purchased are to be returned to or the check for the Special
Cash Payment is to be issued in the name of, a person other than the person(s)
signing this Letter of Transmittal and Proxy or if the check and/or any
certificate for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal and Proxy
or to an address other than that shown in the box above under the heading
"Name(s) and Address(es) of Registered Holder(s)," then the "Special Payment
Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal and Proxy should be completed. Preferred Shareholders tendering
Shares by book-entry transfer will have any Shares not accepted for payment
returned by crediting the account maintained by such Preferred Shareholder at
the Book-Entry Transfer Facility.
8. SUBSTITUTE FORM W-9 AND FORM W-8. A tendering Preferred Shareholder and a
Preferred Shareholder voting in favor of the Proposed Amendment (but not
tendering) is required to provide the Depositary with (i) in the case of a
Untied States Preferred Shareholder, a correct Taxpayer Identification Number
("TIN") and a certification that the IRS has not notified such shareholder
that he is subject to backup withholding on Substitute Form W-9, or (ii) in
the case of a foreign Preferred Shareholder, a properly completed Form W-8, as
discussed below under "Important Tax Information." Failure to provide the
information on either Substitute Form W-9 or Form W-8 may subject the
Preferred Shareholder to a $50 penalty imposed by the Internal Revenue Service
and to 31% federal income tax backup withholding on gross amount payable. The
box in Part 2 of Substitute Form W-9 may be checked if the Preferred
Shareholder has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future. If the box in Part 2 is checked and
the Depositary is not provided with a TIN by the time of payment, the
Depositary will withhold 31% of the gross amount otherwise payable thereafter
until a TIN is provided to the Depositary.
9. REQUESTS FOR ASSISTANCE OF ADDITIONAL COPIES. Any questions or requests
for assistance may be directed to the Information Agent or the Dealer Manager
at their respective telephone numbers
14
<PAGE>
and addresses listed below. Requests for additional copies of the Offer to
Purchase and Proxy Statement, this Letter of Transmittal and Proxy or other
tender offer materials may be directed to the Information Agent or the Dealer
Manager and such copies will be furnished promptly at Conectiv's expense.
Preferred Shareholders may also contact their local broker, dealer, commercial
bank or trust company for assistance concerning the Offer.
10. SOLICITED TENDERS. Conectiv will pay a solicitation fee of an amount
equal to $1.50 per Share for Shares that are tendered, accepted for payment
and paid for pursuant to the Offer (except that for transactions for
beneficial owners whose ownership equals or exceeds 2,500 Shares, Conectiv
will pay a solicitation fee of an amount equal to $ 1.00 per Share). With
respect to fees payable pursuant to this paragraph involving transactions for
beneficial owners whose ownership is less than 2,500 Shares, any fees payable
hereunder shall be paid in full to the Dealer Manager unless a Soliciting
Dealer is designated (as herein described), in which case such fee shall be
payable in full to such designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). With respect to fees payable
pursuant to this paragraph involving transactions for beneficial owners whose
ownership equals or exceeds 2,500 Shares, any fees payable hereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case 80% of such fee shall be paid to the Dealer Manager and 20% of
such fee shall be paid to the designated Soliciting Dealer (which designated
Soliciting Dealer may be the Dealer Manager). A designated Soliciting Dealer
shall be named hereunder under the heading "Solicited Tenders," and shall have
solicited and obtained the tender, and shall also be (a) any broker or dealer
in securities including the Dealer Manager in its capacity as a dealer or
broker, which is a member of any national securities exchange or of the NASD,
(b) any foreign broker or dealer not eligible for membership in the NASD which
agrees to conform to the NASD's Rules of Fair Practice in soliciting tenders
outside the United States to the same extent as though it were an NASD member,
or (c) any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of
Transmittal and Proxy or on the Notice of Solicited Tenders (included in the
materials provided to brokers and dealers). No such fee shall be payable to a
Soliciting Dealer with respect to the tender of Shares by the holder of
record, for the benefit of the beneficial owner, unless the beneficial owner
has designated such Soliciting Dealer. If tendered Shares are being delivered
by book-entry transfer, the Soliciting Dealer must return a Notice of
Solicited Tenders to the Depositary within three business days after
expiration of the Offer to receive a solicitation fee. No such fee shall be
payable to a Soliciting Dealer if such Soliciting Dealer is required for any
reason to transfer the amount of such fee to a depositing holder (other than
itself). No such fee shall be paid to a Soliciting Dealer with respect to
Shares tendered for such Soliciting Dealer's own account. No broker, dealer,
bank, trust company or fiduciary shall be deemed to be the agent of Conectiv,
the Company, the Depositary, the Information Agent or the Dealer Manager for
purposes of the Offer.
Soliciting Dealers will include any organizations described in clauses (a),
(b) or (c) above even when the activities of such organization in connection
with the Offer consist solely of forwarding to clients materials relating to
the Offer, including this Letter of Transmittal and Proxy, and tendering
Shares as directed by beneficial owners thereof. No Soliciting Dealer is
required to make any recommendation to holders of Shares as to whether to
tender or refrain from tendering in the Offer. No assumption is made, in
making payment to any Soliciting Dealer, that its activities in connection
with the Offer included any activities other than those described above, and
for all purposes noted in all materials relating to the Offer, the term
"solicit" shall be deemed to mean no more than "processing shares tendered" or
"forwarding to customers materials regarding the Offer."
11. IRREGULARITIES. All questions as to the form of documents and the
validity, eligibility (including time of receipt) and acceptance of any tender
of Shares will be determined by Conectiv, in its sole discretion, and its
determination shall be final and binding. Conectiv reserves the absolute right
to reject any and all tenders of Shares that it determines are not in proper
form or the acceptance for payment of or payment for Shares that may, in the
opinion of Conectiv's counsel, be unlawful. Conectiv also reserves the
absolute right to waive any of the conditions to the Offer or any defect or
irregularity in any tender of Shares and Conectiv's
15
<PAGE>
interpretation of the terms and conditions of the Offer (including these
instructions) shall be final and binding. Unless waived, any defects or
irregularities in connection with tenders must be cured within such time as
Conectiv shall determine. None of Conectiv, the Company, the Dealer Manager,
the Depositary, the Information Agent or any other person shall be under any
duty to give notice of any defect or irregularity in tenders, nor shall any of
them incur any liability for failure to give any such notice. Tenders will not
be deemed to have been made until all defects and irregularities have been
cured or waived.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any of your certificate(s)
for Shares have been lost, stolen or destroyed, please call ACE Stockholder
Services at (800) 365-6495 (toll free). You may need to complete an Affidavit
of Loss with respect to the lost certificate(s) (which will be provided by ACE
Stockholder Services) and payment of an indemnity bond premium fee may be
required. The tender of Shares pursuant to this Letter of Transmittal and
Proxy will not be valid unless prior to the Expiration Date: (a) such
procedures have been completed and a replacement certificate for the Shares
has been delivered to the Depositary or (b) a Notice of Guaranteed Delivery
and Proxy has been delivered to the Depositary. See Instruction 2.
IMPORTANT: THIS LETTER OF TRANSMITTAL AND PROXY, DULY EXECUTED, TOGETHER
WITH, IF APPLICABLE, CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER, AND
ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR, IF
APPLICABLE, THE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE RECEIVED BY
THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
16
<PAGE>
IMPORTANT TAX INFORMATION
Under federal income tax law, a Preferred Shareholder whose tendered Shares
are accepted for payment or who will receive a Special Cash Payment as a
result of voting in favor of the Proposed Amendment is required to provide the
Depositary (as payer) with either such Preferred Shareholder's correct TIN on
Substitute Form W-9 below or a properly completed Form W-8. If such Preferred
Shareholder is an individual, the TIN is his or her social security number.
For businesses and other entities, the number is the federal employer
identification number. If the Depositary is not provided with the correct TIN
or properly completed Form W-8, the Preferred Shareholder may be subject to a
$50 penalty imposed by the Internal Revenue Code. In addition, payments that
are made to such Preferred Shareholder with respect to Shares purchased
pursuant to the Offer may be subject to 31% backup withholding.
Certain Preferred Shareholders (including, among others, all corporations
and certain foreign individuals) are exempt from backup withholding. For a
corporate United States Preferred Shareholder to qualify for such exemption,
such Preferred Shareholder must provide the Depositary with a properly
completed and executed Substitute Form W-9 attesting to its exempt status. In
order for a foreign Preferred Shareholder to qualify as an exempt recipient,
such Preferred Shareholder must submit to the Depositary a properly completed
Internal Revenue Service Form W-8 (a "Form W-8"), signed under penalties of
perjury, attesting to that Preferred Shareholder's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If federal income tax backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the Preferred Shareholder. Backup
withholding is not an additional tax. Rather, the federal income tax liability
of persons subject to backup withholding will be reduced by the amount of the
tax withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9 AND FORM W-8
To avoid backup withholding on a Special Cash Payment or payments that are
made to a Preferred Shareholder with respect to Shares purchased pursuant to
the Offer, the Preferred Shareholder is required to notify the Depositary of
his or her correct TIN by completing the Substitute Form W-9 attached hereto
certifying that the TIN provided on Substitute Form W-9 is correct and that
(a) the Preferred Shareholder has not been notified by the Internal Revenue
Service that he or she is subject to federal income tax backup withholding as
a result of failure to report all interest or dividends or (b) the Internal
Revenue Service has notified the Preferred Shareholder that he or she is no
longer subject to federal income tax backup withholding. Foreign Preferred
Shareholders must submit a properly completed Form W-8 in order to avoid the
applicable backup withholding; provided, however, that backup withholding will
not apply to foreign Preferred Shareholders subject to withholding under other
provisions of the Code or the Special Cash Payment or on gross payments
received pursuant to the Offer. Foreign Preferred Shareholders that submit a
properly completed Form W-8 may nevertheless be subject to withholding under
other provisions of the Code on the payments received by them.
WHAT NUMBER TO GIVE THE DEPOSITARY
The Preferred Shareholder is required to give the Depositary the social
security number or employer identification number of the registered owner of
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
17
<PAGE>
PAYER'S NAME
Part 1--PLEASE PROVIDE YOUR Social Security
TIN IN THE BOX AT RIGHT AND Number OR Employer
SUBSTITUTE CERTIFY BY SIGNING AND DATING Identification TIN
FORM W-9 BELOW.
DEPARTMENT OF -----------------
THE TREASURY -----------------------------------------------------
INTERNAL Name (Please Print) ___________
REVENUE SERVICE Address _______________________ Part 2--
City ___ State __ Zip Code __ Awaiting TIN [_]
PAYER'S REQUEST FOR -----------------------------------------------------
TAXPAYER IDENTIFICATION Part 3--CERTIFICATION--UNDER PENALTIES OF PERJURY,
NUMBER ("TIN") AND I CERTIFY THAT: (1) the number shown on this form
CERTIFICATION is my correct taxpayer identification number (or a
TIN has not been issued to me but I have mailed or
delivered an application to receive a TIN or
intend to do so in the near future), (2) I am not
subject to backup withholding either because I
have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends or the IRS has notified me
that I am no longer subject to backup withholding
and (3) all other information provided on this
form is true, correct and complete.
SIGNATURE ______________ DATE _______________, 1998
You must cross out item (2) above if you have been
notified by the IRS that you are currently subject
to backup withholding because of underreporting
interest or dividends on your tax return.
-----------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY
PAYMENTS MADE TO YOU PURSUANT TO THE OFFER OR
PROXY SOLICITATION. PLEASE REVIEW THE ENCLOSED
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS. YOU MUST COMPLETE THE
FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
I certify under penalties of perjury that a
taxpayer identification number has not been issued
to me and either (1) I have mailed or delivered an
application to receive a taxpayer identification
number to the appropriate Internal Revenue Service
Center or Social Security Administration Office or
(2) I intend to do so in the near future. I
understand that if I do not provide a taxpayer
identification number by the time of payment, 31%
of all payments made to me will be withheld until
I provide a number.
SIGNATURE ______________ DATE _______________, 1998
THE INFORMATION AGENT:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll free)
or
Banks and Brokers call
(212) 269-5550
18
<PAGE>
EXHIBIT 99(a)(3)
NOTICE OF GUARANTEED DELIVERY AND PROXY
FOR
CONECTIV
OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING
SERIES OF CUMULATIVE PREFERRED STOCK OF
ATLANTIC CITY ELECTRIC COMPANY
CUMULATIVE PREFERRED STOCK:
4% SERIES ($100 PAR VALUE)
4.10% SERIES ($100 PAR VALUE)
4.35% SERIES ($100 PAR VALUE)
4.35% 2ND SERIES ($100 PAR VALUE)
4.75% SERIES ($100 PAR VALUE)
5% SERIES ($100 PAR VALUE)
This form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) if certificates for shares of a series of
preferred stock of Atlantic City Electric Company (the "Company"), a New
Jersey corporation and direct utility subsidiary of Conectiv, listed above
(each a "Series of Preferred") to be tendered pursuant to the Offer (the
"Shares") are not immediately available, if the procedure for book-entry
transfer cannot be completed on a timely basis, or if time will not permit all
other documents required by the Letter of Transmittal and Proxy to be
delivered to the Depositary on or prior to the Expiration Date (as defined in
the Offer to Purchase and Proxy Statement referred to below). Such form may be
delivered by hand or transmitted by mail or by facsimile transmission to the
Depositary. See "Terms of the Offer--Procedure for Tendering Shares" in the
Offer to Purchase and Proxy Statement.
A SEPARATE NOTICE OF GUARANTEED DELIVERY AND PROXY MUST BE USED FOR EACH
SERIES OF PREFERRED.
THE ELIGIBLE INSTITUTION WHICH COMPLETES THIS FORM MUST COMMUNICATE THE
GUARANTEE TO THE DEPOSITARY AND MUST DELIVER THE LETTER OF TRANSMITTAL AND
PROXY AND CERTIFICATES FOR SHARES TO THE DEPOSITARY WITHIN THE TIME SHOWN
HEREIN. FAILURE TO DO SO COULD RESULT IN A FINANCIAL LOSS TO SUCH ELIGIBLE
INSTITUTION.
TO: THE BANK OF NEW YORK, DEPOSITARY
By Mail: By Hand or Overnight Courier:
Tender & Exchange Department Tender & Exchange Department
P.O. Box 11248 101 Barclay Street
Church Street Station Receive and Deliver Window
New York, New York 10286-1248 New York, New York 10286
By Facsimile Transmission:
(212) 815-6213
Information and Confirm by Telephone:
(800) 507-9357 (toll free)
<PAGE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN ONE LISTED
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal and Proxy is required to be guaranteed by an Eligible
Institution (as defined in the Letter of Transmittal and Proxy) under the
instructions thereto, such signature guarantee must appear in the applicable
space provided in the signature box on the Letter of Transmittal and Proxy.
The undersigned hereby tenders to Conectiv, a Delaware corporation
("Conectiv"), upon the terms and subject to the conditions set forth in the
Offer to Purchase and Proxy Statement, dated September 10, 1998 (the "Offer to
Purchase and Proxy Statement"), and the related Letter of Transmittal and
Proxy (which together constitute the "Offer"), receipt of which is hereby
acknowledged, the number of Shares listed below, pursuant to the guaranteed
delivery procedure set forth in "Terms of the Offer--Procedure for Tendering
Shares" in the Offer to Purchase and Proxy Statement. PREFERRED SHAREHOLDERS
(INCLUDING PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES SUBSEQUENT TO THE RECORD
DATE) WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE OFFER MUST VOTE IN FAVOR
OF THE PROPOSED AMENDMENT TO THE COMPANY'S CHARTER (THE "CHARTER"), AS SET
FORTH IN THE OFFER TO PURCHASE AND PROXY STATEMENT (THE "PROPOSED AMENDMENT").
PREFERRED SHAREHOLDERS WHO PURCHASE OR WHOSE PURCHASE SETTLES OR IS REGISTERED
AFTER THE CLOSE OF BUSINESS ON SEPTEMBER 14, 1998 (THE "RECORD DATE") AND WHO
WISH TO TENDER THEIR SHARES IN THE OFFER MUST ARRANGE WITH THEIR SELLER TO
RECEIVE A DULY COMPLETED, VALID AND UNREVOKED PROXY (WHICH MAY BE IN THE FORM
OF IRREVOCABLE ASSIGNMENT OF PROXY ATTACHED HERETO) FROM THE HOLDER OF RECORD
ON THE RECORD DATE AND INCLUDE SUCH PROXY WITH THIS NOTICE OF GUARANTEED
DELIVERY AND PROXY OR VOTE SUCH PROXY FOR THE PROPOSED AMENDMENT AT THE
SPECIAL MEETING (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT). THE
OFFER IS CONDITIONED UPON THE PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT
THE SPECIAL MEETING. IN ADDITION, PREFERRED SHAREHOLDERS HAVE THE RIGHT TO
VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY TENDER THEIR SHARES
BY CASTING THEIR VOTE AND SIGNING THE PROXY CONTAINED WITHIN THE ACCOMPANYING
LETTER OF TRANSMITTAL AND PROXY OR BY VOTING IN PERSON AT THE SPECIAL MEETING.
IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED, THE COMPANY WILL MAKE A
SPECIAL CASH PAYMENT (AS DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT)
TO EACH PREFERRED SHAREHOLDER WHO VOTED IN FAVOR OF THE PROPOSED AMENDMENT,
PROVIDED THAT SUCH HOLDER'S SHARES ARE NOT TENDERED PURSUANT TO THE OFFER.
The undersigned hereby also appoints Howard E. Cosgrove, Barbara S. Graham
and Louis M. Walters, or any of them, as proxies, each with the power to
appoint his or her substitute, and hereby authorizes them to represent and to
vote as designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all shares of preferred
stock of the Company which the undersigned is entitled to vote at the Special
Meeting of Shareholders to be held on October 14, 1998, or any adjournment(s)
or postponement(s) thereof.
THIS NOTICE OF GUARANTEED DELIVERY AND PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS OF THE COMPANY. THE PROXY CONTAINED HEREIN, WHEN PROPERLY
EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
SHAREHOLDER(S). If no direction is made, the proxy will be voted FOR Item 1.
An abstention is the equivalent of a vote AGAINST the Proposed Amendment.
2
<PAGE>
A holder of Preferred Shares who elects to tender Shares pursuant to this
Notice of Guaranteed Delivery and Proxy must check one of the boxes below:
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment is enclosed herein.
[_]A valid vote FOR the Proposed Amendment will be cast at the Special
Meeting.
[_]A duly completed, valid and unrevoked proxy indicating a vote FOR the
Proposed Amendment will be delivered within three New York Stock
Exchange trading days after the execution of this Notice of Guaranteed
Delivery and Proxy.
Indicate your vote by an (X). The Board of Directors recommends voting
FOR Item 1.
HOLDERS OF SHARES WHO WISH TO TENDER THEIR SHARES MUST VOTE FOR THE PROPOSED
AMENDMENT EITHER BY SUBMITTING THIS PROXY OR BY VOTING AT THE SPECIAL MEETING.
ITEM 1.
To remove from the Charter Paragraph (7)(B)(c) of Article III, a provision
restricting the amount of securities representing unsecured indebtedness
issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
Series of Preferred (check one):
CUMULATIVE PREFERRED STOCK ($100 PAR VALUE):
[_]4% Series
[_]4.10% Series
[_]4.35% Series
[_]4.35% 2nd Series
[_]4.75% Series
[_]5% Series
A separate Notice of Guaranteed Delivery and Proxy must be used for each
Series of Preferred.
Number of Shares:
_____________________________________
Certificate Nos. (if available):
_____________________________________
_____________________________________
_____________________________________
_____________________________________
Any holders of Shares held of record on the Record Date in the name of
another holder must establish to the satisfaction of the Company its
entitlement to exercise or transfer this Proxy. This will ordinarily require
an assignment by such record holders in blank or, if not in blank, to and from
each successive transferee, including the holder, with each signature
guaranteed by an Eligible Institution. A form of irrevocable assignment of
proxy has been provided herein.
Please check box if you plan to attend the Special Meeting. [_]
3
<PAGE>
SIGNATURE(S) OF OWNER(S)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
Dated: __________________________________________________________________, 1998
Name(s): ______________________________________________________________________
_______________________________________________________________________________
(PLEASE PRINT)
Capacity (full title): ________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(INCLUDE ZIP CODE)
DAYTIME Area Code and Telephone No.: __________________________________________
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
the stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in
a fiduciary or representative capacity, please set forth full title and see
Instruction 5 to the Letter of Transmittal and Proxy.)
If Shares will be tendered by
book-entry transfer, Name of
Tendering Institution:
_____________________________________
Account No.: _____________________ at
The Depositary Trust Company
_____________________________________
Signature(s)
_____________________________________
Name(s) of Record Holders(s) (Please
Print)
_____________________________________
Address
_____________________________________
Area Code and Telephone Number
4
<PAGE>
IF SELLING SHARES SUBSEQUENT TO SEPTEMBER 14, 1998, A RECORD HOLDER MUST
COMPLETE THE FOLLOWING IRREVOCABLE PROXY.
PLEASE SIGN THIS TO IRREVOCABLY TRANSFER A PREFERRED STOCK
PROXY TO A SUBSEQUENT HOLDER OF PREFERRED STOCK WHO
WAS NOT A HOLDER OF RECORD ON SEPTEMBER 14, 1998
IRREVOCABLE PROXY
WITH RESPECT TO SHARES OF THE
SERIES OF CUMULATIVE PREFERRED STOCK
OF
ATLANTIC CITY ELECTRIC COMPANY (THE "COMPANY")
THE UNDERSIGNED HEREBY IRREVOCABLY APPOINTS
--------------------------------------
TYPE OR PRINT NAME OF TRANSFEREE
as attorney and proxy, with full power of substitution, to vote and otherwise
act for and in the name(s) of the undersigned with respect to the Shares
indicated below which were held of record by the undersigned on September 14,
1998, in the manner in which the undersigned would be entitled to vote and
otherwise act in respect of such Shares on any and all matters.
This proxy shall be effective whether or not the Shares indicated below are
tendered in the Offer.
This instrument supersedes and revokes any and all previous appointments of
proxies heretofore made by the undersigned with respect to the Shares
indicated below as to any and all matters. THIS PROXY IS IRREVOCABLE AND IS
COUPLED WITH AN INTEREST.
All authority conferred or agreed to be conferred herein shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal
and personal representatives, successors in interest and assigns of the
undersigned. The undersigned understands that tenders of Shares pursuant to
any of the procedures described in the Offer to Purchase and Proxy Statement
and in the Letter of Transmittal and Proxy will constitute a binding agreement
between the undersigned and the Company upon the terms and subject to the
conditions of the Offer.
- -------------------------------------------------------------------------------
DESCRIPTION OF PREFERRED STOCK
- -------------------------------------------------------------------------------
CERTIFICATE NUMBER(S) AGGREGATE NUMBER
(ATTACH LIST IF NECESSARY) OF SHARES
_____________________________________ _______________________________________
_____________________________________ _______________________________________
_____________________________________ _______________________________________
_____________________________________ _______________________________________
_____________________________________ _______________________________________
_____________________________________ Total: ________________________________
_____________________________________ _______________________________________
SIGNATURE OF RECORD HOLDER OR SIGNATURE OF RECORD HOLDER OR
AUTHORIZED SIGNATORY AUTHORIZED SIGNATORY
_____________________________________ _______________________________________
TYPE OR PRINT NAME TYPE OR PRINT NAME
Date: ________________________ , 1998 Date: __________________________ , 1998
Tax Identification or Social Security No(s). __________________________________
5
<PAGE>
Must be signed by holder(s) exactly as name(s) appear(s) on the Record Date
on certificate(s) for the Shares or on a security position listing or by
person(s) authorized to become holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, agent or other person
acting in a fiduciary or representative capacity, please provide the following
information and see Instruction 5 of the Letter of Transmittal and Proxy.
Name: _______________________________ Address: ______________________________
_____________________________________ _______________________________________
Please Print Include Zip Code
Area Code and Tel. No. ________________________________________________________
Capacity (Full Title) _________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Title: ________________________________________________________________________
Dated: _________________________________________________________________ , 1998
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a member of a registered national securities
exchange or the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or correspondent in the
United States, guarantees to deliver to the Depositary at one of its addresses
set forth above certificate(s) for the Shares tendered hereby, in proper form
for transfer, or a confirmation of the book-entry transfer of the Shares
tendered hereby into the Depositary's account at The Depository Trust Company,
in each case together with properly completed and duly executed Letter(s) of
Transmittal and Proxy (or facsimile(s) thereof), with any required signature
guarantee(s) and any other required documents, all within three New York Stock
Exchange trading days after the date hereof.
_____________________________________ _______________________________________
Name of Firm Authorized Signature
_____________________________________ _______________________________________
Address Name
_____________________________________ _______________________________________
City, State, Zip Code Title
_____________________________________
Area Code and Telephone Number
Dated: ________________________, 1998
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES
MUST BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
6
<PAGE>
EXHIBIT 99(a)(4)
CONECTIV
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING SERIES OF
PREFERRED STOCK OF
ATLANTIC CITY ELECTRIC COMPANY
<TABLE>
<CAPTION>
TITLE OF SERIES OF OUTSTANDING CUSIP PURCHASE PRICE
PREFERRED SHARES NUMBER (PER SHARE)
- ------------------ ----------- ----------------------- --------------
<S> <C> <C> <C>
CUMULATIVE PREFERRED STOCK
($100 PAR VALUE)
4% Series.................. 77,000 048303200 and 048303903 $ 81.60
4.10% Series............... 72,000 048303770 $ 83.50
4.35% Series............... 15,000 048303762 $ 88.60
4.35% 2nd Series........... 36,000 048303507 $ 88.60
4.75% Series............... 50,000 048303309 $ 96.75
5% Series.................. 50,000 048303788 $100.00
</TABLE>
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED.
September 10, 1998
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
In our capacity as Dealer Manager, we are enclosing the material listed
below relating to the invitation of Conectiv, a Delaware corporation
("Conectiv"), to the holders of each series of preferred stock of Atlantic
City Electric Company (the "Company"), a New Jersey corporation and direct
utility subsidiary of Conectiv, listed above (each a "Series of Preferred") to
tender any and all of their shares of a Series of Preferred ("Shares") for
purchase at the purchase price per Share listed above, net to the seller in
cash, upon the terms and subject to the conditions set forth in the Offer to
Purchase and Proxy Statement, dated September 10, 1998 (the "Offer to Purchase
and Proxy Statement"), and in the Letter of Transmittal and Proxy for the
Shares tendered. As to each Series of Preferred, the Offer to Purchase and
Proxy Statement, together with the applicable Letter of Transmittal and Proxy,
constitutes the "Offer." Conectiv will purchase all Shares validly tendered
and not withdrawn, upon the terms and subject to the conditions of the Offer.
The Offer for a Series of Preferred is not conditioned upon any minimum number
of Shares of such Series of Preferred being tendered and is independent of the
Offer for any other Series of Preferred. PREFERRED SHAREHOLDERS (INCLUDING
PREFERRED SHAREHOLDERS WHO ACQUIRE SHARES AFTER THE RECORD DATE) WHO WISH TO
TENDER THEIR SHARES PURSUANT TO THE OFFER MUST VOTE IN FAVOR OF THE PROPOSED
AMENDMENT TO THE COMPANY'S CHARTER, AS SET FORTH IN THE OFFER TO PURCHASE AND
PROXY STATEMENT (THE "PROPOSED AMENDMENT"). THE OFFER IS CONDITIONED UPON THE
PROPOSED AMENDMENT BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING (AS
DEFINED IN THE OFFER TO PURCHASE AND PROXY STATEMENT). IN ADDITION, PREFERRED
SHAREHOLDERS HAVE THE RIGHT TO VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF
WHETHER THEY TENDER THEIR SHARES. SEE "PROPOSED AMENDMENT AND PROXY
SOLICITATION," "TERMS OF THE OFFER--CERTAIN CONDITIONS OF THE OFFER" AND
"TERMS OF THE OFFER--EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS" IN
THE OFFER TO PURCHASE AND PROXY STATEMENT.
IN ORDER TO VALIDLY TENDER SHARES PURSUANT TO THE OFFER, PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES DURING THE PERIOD BEGINNING TWO BUSINESS DAYS
PRIOR TO THE RECORD DATE AND UP TO AND INCLUDING THE EXPIRATION DATE MUST
OBTAIN AN ASSIGNMENT OF PROXY FROM THE SELLER OF SUCH SHARES AND VOTE SUCH
PROXY IN FAVOR OF THE PROPOSED AMENDMENT. IN ORDER TO FACILITATE THE TRANSFER
1
<PAGE>
OF SHARES DURING THE PERIOD DESCRIBED ABOVE, THE SHARES OF EACH SERIES OF
PREFERRED WILL TRADE "WITH PROXY" IN THE OVER-THE-COUNTER MARKET. SETTLEMENT
OF ALL TRADES DURING THE PERIOD DESCRIBED ABOVE SHOULD INCLUDE AN ASSIGNMENT
OF PROXY FROM THE SELLER.
The Shares will trade, during the period which begins two business days
prior to the Record Date and which will end at the close of business on the
Expiration Date, in the over-the-counter market "with proxy." A Preferred
Shareholder who acquires Shares during this period must obtain, or have its
authorized representative obtain, an assignment of proxy (which is included in
the applicable Letter of Transmittal and Proxy) at settlement from the seller.
The National Association of Securities Dealers, Inc. (the "NASD") and The
Depository Trust Company have issued notices informing their members and
participants that the Shares are trading "with proxy" and that settlement of
all trades during the period described above should include an assignment of
proxy from the seller.
We are asking you to contact your clients for whom you hold Shares
registered in your name (or in the name of your nominee) or who hold Shares
registered in their own names. Please bring the Offer to their attention as
promptly as possible.
Conectiv will pay a solicitation fee of $1.50 per Share for any Shares
tendered, accepted for payment and paid for pursuant to the Offer; provided
that with respect to transactions for beneficial owners whose ownership equals
or exceeds 2,500 Shares, Conectiv will pay a solicitation fee of $1.00 per
Share. With respect to fees that involve transactions for beneficial owners of
whose ownership is less than 2,500 Shares, any fee payable thereunder shall be
paid in full to the Dealer Manager unless a Soliciting Dealer is designated,
in which case such fee shall be paid in full to the Soliciting Dealer (which
designated Soliciting Dealer may be the Dealer Manager). With respect to fees
that involve transactions for beneficial owners whose ownership equals or
exceeds 2,500 Shares, any fee payable thereunder shall be paid in full to the
Dealer Manager unless a Soliciting Dealer is designated, in which case, 80% of
such fee shall be paid to the Dealer Manager and 20% of such fee shall be paid
to the Soliciting Dealer (which designated Soliciting Dealer may be the Dealer
Manager).
A designated Soliciting Dealer is an entity covered by a Letter of
Transmittal and Proxy which designates its name as having solicited and
obtained the tender, and it is (i) any broker or dealer in securities,
including the Dealer Manager in its capacity as a broker or dealer, which is a
member of any national securities exchange or of the NASD, (ii) any foreign
broker or dealer not eligible for membership in the NASD which agrees to
conform to the NASD's Rules of Fair Practice in soliciting tenders outside the
United States to the same extent as though it were an NASD member, or (iii)
any bank or trust company (each of which is referred to herein as a
"Soliciting Dealer"). No such fee shall be payable to a Soliciting Dealer with
respect to the tender of Shares by a holder unless the Letter of Transmittal
and Proxy accompanying such tender designates such Soliciting Dealer. No such
fee shall be payable to a Soliciting Dealer in respect of Shares registered in
the name of such Soliciting Dealer unless such Shares are held by such
Soliciting Dealer as nominee and such Shares are being tendered for the
benefit of one or more beneficial owners identified on the Letter of Transfer
and Proxy or on the Notice of Solicited Tenders (included below). No such fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer the amount of such fee to a depositing holder
(other than itself). No such fee shall be paid to a Soliciting Dealer with
respect to Shares tendered for such Soliciting Dealer's own account. No
broker, dealer, bank, trust company or fiduciary shall be deemed to be the
agent of Conectiv, the Company, the Depositary (as defined below), the Dealer
Manager or the Information Agent for purposes of the Offer. For all purposes
noted in all materials relating to the Offer, the term "solicit" shall be
deemed to mean no more than "processing shares tendered" or "forwarding to
customers materials relating to the Offer."
Conectiv will also, upon request, reimburse Soliciting Dealers for
reasonable and customary handling and mailing expenses incurred by them in
forwarding materials relating to the Offer to their customers. Conectiv will
pay all stock transfer taxes applicable to its purchase of Shares pursuant to
the offer, subject to Instruction 6 of the Letter of Transmittal and Proxy.
2
<PAGE>
IN ORDER FOR A SOLICITING DEALER TO RECEIVE A SOLICITATION FEE, THE BANK OF
NEW YORK, AS DEPOSITARY (THE "DEPOSITARY"), MUST HAVE RECEIVED FROM SUCH
SOLICITING DEALER A PROPERLY COMPLETED AND DULY EXECUTED NOTICE OF SOLICITED
TENDERS IN THE FORM ATTACHED HERETO (OR FACSIMILE THEREOF) WITHIN THREE
BUSINESS DAYS AFTER THE EXPIRATION OF THE OFFER.
For your information and for forwarding to your clients for whom you hold
Shares registered in your name (or in the name of your nominee), we are
enclosing the following documents:
1. The Offer to Purchase and Proxy Statement, dated September 10, 1998.
2. A separate Letter of Transmittal and Proxy for each Series of
Preferred for your use and for the information of your clients.
3. A letter to shareholders of the Company from its Chairman and Chief
Executive Officer.
4. A Notice of Guaranteed Delivery and Proxy to be used to accept the
Offer if the Shares and all other required documents cannot be delivered to
the Depositary by the applicable Expiration Date (as defined in the Offer
to Purchase and Proxy Statement).
5. A form of letter which may be sent to your clients for whose accounts
you hold Shares registered in your name or in the name of your nominee,
with space for obtaining such clients' instructions with regard to the
Offer by Conectiv and with regard to the proxy solicitation by the Company.
6. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9, providing information relating to backup federal
income tax withholding.
7. A return envelope addressed to The Bank of New York, the Depositary.
8. A DTC Summary Voting Form to be used by participants of DTC to
consolidate voting across multiple issues (i.e., summary ballot).
EACH SERIES OF PREFERRED HAS ITS OWN LETTER OF TRANSMITTAL AND PROXY, AND
ONLY THE APPLICABLE LETTER OF TRANSMITTAL AND PROXY FOR A PARTICULAR SERIES OR
A NOTICE OF GUARANTEED DELIVERY AND PROXY MAY BE USED TO TENDER SHARES OF SUCH
SERIES OF PREFERRED.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE
THAT THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED.
NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF DIRECTORS NOR ANY
OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED
SHAREHOLDER AS TO WHETHER TO TENDER ANY OR ALL SHARES. EACH PREFERRED
SHAREHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES
AND, IF SO, HOW MANY SHARES TO TENDER.
Any questions or requests for assistance or additional copies of the
enclosed materials may be directed to D.F. King & Co., Inc., the Information
Agent, or to us, as Dealer Manager, at the respective addresses and telephone
numbers set forth on the back cover of the enclosed Offer to Purchase and
Proxy Statement.
Very truly yours,
Morgan Stanley & Co. Incorporated
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY PERSON AS THE AGENT OF CONECTIV, THE COMPANY, THE DEALER MANAGER, THE
INFORMATION AGENT OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO
USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION
WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS
CONTAINED THEREIN.
3
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 4% SERIES
CUSIP NUMBERS 048303200 AND 048303903
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
4
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 4.10% SERIES
CUSIP NUMBER 048303770
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
5
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 4.35% SERIES
CUSIP NUMBER 048303762
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
6
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 4.35% 2ND SERIES
CUSIP NUMBER 048303507
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
7
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 4.75% SERIES
CUSIP NUMBER 048303309
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
8
<PAGE>
ATLANTIC CITY ELECTRIC COMPANY
NOTICE OF SOLICITED TENDERS FOR THE 5% SERIES
CUSIP NUMBER 048303788
List below the number of Shares tendered by each beneficial owner whose
tender you have solicited. All shares in a Series of Preferred beneficially
owned by a beneficial owner, whether in one account or several, and in however
many capacities, must be aggregated for purposes of completing the table
below. Any questions as to what constitutes beneficial ownership should be
directed to the Depositary. If the space below is inadequate, list the Shares
in a separate signed schedule and affix the list to this Notice of Solicited
Tenders.
ALL NOTICES OF SOLICITED TENDERS SHOULD BE DETACHED BY TEARING ALONG THE
PERFORATED EDGE AND RETURNED TO THE DEPOSITARY AT THE ADDRESS SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE WITHIN THREE NEW YORK STOCK EXCHANGE
TRADING DAYS AFTER THE EXPIRATION OF THE OFFER. NOTICES MAY BE FAXED TO THE
DEPOSITARY AT (212) 815-6213 CONFIRMATION TELEPHONE NUMBER (800) 507-9357
(TOLL FREE). ALL QUESTIONS CONCERNING THE NOTICES OF SOLICITED TENDERS SHOULD
BE DIRECTED TO THE INFORMATION AGENT AT THE TELEPHONE NUMBER SET FORTH ON THE
BACK COVER OF THE OFFER TO PURCHASE.
ALL SOLICITING DEALERS ARE REQUIRED TO COMPLETE THE FOLLOWING. PLEASE TYPE
OR PRINT NEATLY.
BENEFICIAL OWNERS OF LESS THAN 2,500 SHARES--SOLICITATION FEE OF
$1.50 PER SHARE
<TABLE>
<S> <C> <C> <C>
Number of Shares Number of
DTC Participant VOI Ticket Requested for Beneficial Owner(s)
Number Number* Payment Represented
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
BENEFICIAL OWNERS OF 2,500 OR MORE SHARES--SOLICITATION FEE OF
$1.00 PER SHARE
<TABLE>
<S> <C> <C> <C> <C>
Number of
Number of Shares Beneficial Name of
DTC Participant VOI Ticket Requested for Owner(s) Soliciting
Number Number* Payment Represented Dealer
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- --------
* Complete if Shares delivered by book-entry transfer. Please submit a
separate VOI ticket for Shares tendered when the solicitation fee is to be
directed to another Soliciting Dealer.
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST
BE SENT WITH THE LETTER OF TRANSMITTAL AND PROXY.
PLEASE COMPLETE THE SIGNATURE FORM ON THE LAST PAGE.
9
<PAGE>
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm ___________________________________________________________________________
(Please Print)
Attention ______________________________________________________________________
Address ________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
Phone Number ___________________________________________________________________
Taxpayer Identification or Social Security No. _________________________________
Applicable VOI Number __________________ Number of Shares ____________________
IF SOLICITATION FEES ARE TO BE PAID TO ANOTHER ELIGIBLE INSTITUTION(S),
PLEASE COMPLETE THE FOLLOWING BOXES:
ISSUE CHECK TO:
Firm ___________________________________________________________________________
(Please Print)
Attention ______________________________________________________________________
Address ________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
Phone Number ___________________________________________________________________
Taxpayer Identification or Social Security No. _________________________________
Applicable VOI Number __________________ Number of Shares ____________________
Series ________________
ISSUE CHECK TO:
Firm ___________________________________________________________________________
(Please Print)
Attention ______________________________________________________________________
Address ________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
Phone Number ___________________________________________________________________
Taxpayer Identification or Social Security No. _________________________________
Applicable VOI Number __________________ Number of Shares ____________________
Series ________________
NOTE: IF ADDITIONAL PAYMENT INSTRUCTIONS, PLEASE COPY AND ATTACH.
10
<PAGE>
All questions as to the validity, form and eligibility (including time of
receipt) of Notices of Solicited Tenders will be determined by the Depositary,
in its sole discretion, which determination will be final and binding. Neither
the Depositary nor any other person will be under any duty to give
notification of any defects or irregularities in any Notice of Solicited
Tenders or incur any liability for failure to give such notification.
The undersigned hereby confirms that: (i) it has complied with the
applicable requirements of the Securities Exchange Act of 1934, as amended,
and the applicable rules and regulations thereunder, in connection with such
solicitation; (ii) it is entitled to such compensation for such solicitation
under the terms and conditions of the Offer; (iii) in soliciting tenders of
Shares, it has used no soliciting materials other than those furnished by
Conectiv or the Company; and (iv) if it is a foreign broker or dealer not
eligible for membership in the NASD, it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations.
Firm Name: ____________________________________________________________________
By: ___________________________________________________________________________
Title: ________________________________________________________________________
Address (Including Zip Code): _________________________________________________
Area Code and Telephone Number: _______________________________________________
11
<PAGE>
EXHIBIT 99(a)(5)
CONECTIV
OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES OF THE FOLLOWING
SERIES OF CUMULATIVE PREFERRED STOCK OF
ATLANTIC CITY ELECTRIC COMPANY
<TABLE>
<CAPTION>
OUTSTANDING CUSIP PURCHASE PRICE
TITLE OF SERIES OF PREFERRED SHARES NUMBER (PER SHARE)
- ---------------------------- ----------- --------- --------------
<S> <C> <C> <C>
CUMULATIVE PREFERRED STOCK ($100 PAR
VALUE)
4% Series................................. 77,000 048303200 $ 81.60
and
048303903
4.10% Series.............................. 72,000 048303770 $ 83.50
4.35% Series.............................. 15,000 048303762 $ 88.60
4.35% 2nd Series.......................... 36,000 048303507 $ 88.60
4.75% Series.............................. 50,000 048303309 $ 96.75
5% Series................................. 50,000 048303788 $100.00
</TABLE>
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998, UNLESS THE OFFER IS EXTENDED.
September 10, 1998
To Our Clients:
Enclosed for your consideration are the Offer to Purchase and Proxy
Statement, dated September 10, 1998, and a separate Letter of Transmittal and
Proxy for each series of preferred stock listed above (each a "Series of
Preferred") of Atlantic City Electric Company (the "Company"), a New Jersey
corporation and direct utility subsidiary of Conectiv ("Conectiv"), of which
you own shares. As to each Series of Preferred, the Offer to Purchase and
Proxy Statement, together with the applicable Letter of Transmittal and Proxy,
constitutes the "Offer" of Conectiv to purchase any and all shares of the
Series of Preferred ("Shares") at the purchase price per Share listed above,
net to the seller in cash, upon the terms and subject to the conditions of the
Offer. Conectiv will purchase all Shares validly tendered and not withdrawn,
upon the terms and subject to the conditions of the Offer. The Offer for a
Series of Preferred is not conditioned upon any minimum number of Shares of
such Series of Preferred being tendered and is independent of the Offer for
any other Series of Preferred. Preferred Shareholders (including Preferred
Shareholders who acquire Shares subsequent to the Record Date) who wish to
tender their Shares pursuant to the Offer must vote in favor of the proposed
amendment to the Company's Charter, as set forth in the Offer to Purchase and
Proxy Statement (the "Proposed Amendment"). The Offer is conditioned upon the
Proposed Amendment being approved and adopted at the Special Meeting (as
defined in the Offer to Purchase and Proxy Statement). In addition, Preferred
Shareholders have the right to vote for the Proposed Amendment regardless of
whether they tender their Shares. See "Proposed Amendment and Proxy
Solicitation," "Terms of the Offer -- Certain Conditions of the Offer" and
"Terms of the Offer -- Extension of Tender Period, Termination; Amendments" in
the Offer to Purchase and Proxy Statement.
IN ORDER TO VALIDLY TENDER SHARES PURSUANT TO THE OFFER, PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES DURING THE PERIOD BEGINNING TWO BUSINESS DAYS
PRIOR TO THE RECORD DATE AND UP TO AND INCLUDING THE EXPIRATION DATE MUST
OBTAIN AN ASSIGNMENT OF PROXY FROM THE SELLER OF SUCH SHARES AND VOTE SUCH
PROXY IN FAVOR OF THE PROPOSED AMENDMENT. IN ORDER TO FACILITATE THE TRANSFER
OF SHARES DURING THE PERIOD DESCRIBED ABOVE, THE SHARES OF EACH SERIES OF
PREFERRED WILL TRADE "WITH PROXY" IN THE OVER-THE-COUNTER MARKET. SETTLEMENT
OF ALL TRADES DURING THE PERIOD DESCRIBED ABOVE SHOULD INCLUDE AN ASSIGNMENT
OF PROXY FROM THE SELLER.
1
<PAGE>
The Shares will trade, during the period which begins two business days
prior to the Record Date and which will end at the close of business on the
Expiration Date, in the over-the-counter market "with proxy." A Preferred
Shareholder who acquires Shares during this period must obtain, or have its
authorized representative obtain, an assignment of proxy (which is included in
the applicable Letter of Transmittal and Proxy) at settlement from the seller.
The National Association of Securities Dealers, Inc. (the "NASD") and The
Depository Trust Company have issued notices informing their members and
participants that the Shares are trading "with proxy" and that settlement of
all trades during the period described above should include an assignment of
proxy from the seller.
WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT BUT NOT
REGISTERED IN YOUR NAME. A TENDER OR A VOTE OF SUCH SHARES CAN BE MADE ONLY BY
US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. ANY LETTER OF
TRANSMITTAL AND PROXY FURNISHED TO YOU IS SOLELY FOR YOUR INFORMATION AND
CANNOT BE USED BY YOU TO TENDER OR VOTE SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish us to tender and/or vote any
or all of the Shares held by us for your account, upon the terms and subject
to the conditions set forth in the Offer.
PLEASE READ THE FOLLOWING INFORMATION CAREFULLY:
(1) The Offer is for any and all Shares outstanding as of September 10,
1998. The Offer for a Series of Preferred is independent of the Offer for
any other Series of Preferred.
(2) The Offer and withdrawal rights will expire at 5:00 p.m., New York
City time, on October 14, 1998, unless the Offer is extended with respect
to a Series of Preferred. Your instructions to us should be forwarded to us
in ample time to permit us to submit a tender on your behalf by the
expiration of the Offer. If you would like to withdraw your Shares that we
have tendered, you can withdraw them so long as the Offer remains open or
at any time after the expiration of forty business days from the
commencement of the Offer if such tendered Shares have not been accepted
for payment.
(3) Preferred Shareholders who wish to tender their Shares pursuant to
the Offer must vote in favor of the Proposed Amendment. The Offer is
conditioned upon the Proposed Amendment being approved and adopted at the
Special Meeting.
(4) Preferred Shareholders have the right to vote in favor of the
Proposed Amendment regardless of whether they tender their Shares. If the
Proposed Amendment is approved and adopted, the Company will make a special
cash payment in the amount of $1.00 per Share to each Preferred Shareholder
who voted in favor of the Proposed Amendment, provided that such Shares
have not been tendered pursuant to the Offer.
(5) Any stock transfer taxes applicable to the sale of Shares to Conectiv
pursuant to the Offer will be paid by Conectiv, except as otherwise
provided in Instruction 6 of the Letter of Transmittal and Proxy.
NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF DIRECTORS NOR ANY
OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY PREFERRED
SHAREHOLDER AS TO WHETHER TO TENDER ANY OR ALL SHARES. EACH PREFERRED
SHAREHOLDER MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES
AND, IF SO, HOW MANY SHARES TO TENDER.
If you wish to have us tender and/or vote any or all of your Shares held by
us for your account upon the terms and subject to the conditions set forth in
the Offer, please so instruct us by completing, executing, detaching and
returning to us the instruction form on the detachable part hereof. An
envelope to return your instructions to us is enclosed. If you authorize
tender of your Shares, all such Shares will be tendered unless otherwise
specified on the detachable part hereof. Your instructions should be forwarded
to us in ample time to
2
<PAGE>
permit us to submit a tender and/or vote on your behalf by the expiration of
the Offer or the Special Meeting, as applicable.
The Offer is being made to all holders of Shares. Conectiv is not aware of
any state where the making of the Offer is prohibited by administrative or
judicial action pursuant to a valid state statute. If Conectiv becomes aware
of any valid state statute prohibiting the making of the Offer, Conectiv will
make a good faith effort to comply with such statute. If, after such good
faith effort, Conectiv cannot comply with such statute, the Offer will not be
made to, nor will tenders be accepted from or on behalf of, holders of Shares
in such state. In those jurisdictions where the securities, blue sky or other
laws require the Offer to be made by a licensed broker or dealer, the Offer
shall be deemed to be made on behalf of Conectiv by the Dealer Manager (as
defined in the Offer) or one or more registered brokers or dealers licensed
under the laws of such jurisdictions.
3
<PAGE>
INSTRUCTIONS
WITH RESPECT TO OFFER TO PURCHASE BY CONECTIV FOR CASH ANY AND ALL OUTSTANDING
SHARES OF THE PREFERRED STOCK OF, AND PROXY SOLICITATION BY, ATLANTIC CITY
ELECTRIC COMPANY
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase and Proxy Statement, dated September 10, 1998, and a separate
Letter of Transmittal and Proxy for each series of preferred stock of Atlantic
City Electric Company (the "Company") (each a "Series of Preferred") in which
the undersigned owns shares (as to each Series of Preferred, the Offer to
Purchase and Proxy Statement, together with the applicable Letter of
Transmittal and Proxy, constitutes the "Offer") in connection with the
invitation of Conectiv ("Conectiv") to the holders of each Series of Preferred
to tender any and all of their shares of a Series of Preferred ("Shares") for
purchase at the purchase price per Share listed on the front cover of the
Offer to Purchase and Proxy Statement, net to the seller in cash, upon the
terms and subject to the conditions of the Offer, and in connection with the
proxy solicitation being conducted by the Board of Directors of the Company.
This will instruct you to tender to Conectiv the number of Shares indicated
below (or, if no number is indicated below, all Shares) which are held by you
for the account of the undersigned, upon the terms and subject to the
conditions of the Offer.
SERIES OF PREFERRED NUMBER OF SHARES TO BE TENDERED*
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
You are further instructed to vote as designated hereunder in respect of the
Proposed Amendment all Shares which the undersigned is entitled to vote at the
Special Meeting.**
[_]FOR [_]AGAINST [_]ABSTAIN
SIGN HERE
Signature(s): _________________________________________________________________
Name(s): ______________________________________________________________________
Address: ______________________________________________________________________
Dated: __________________________________________________________________, 1998
Social Security or Taxpayer Identification No.: _______________________________
- --------
* By executing and returning these Instructions, unless otherwise indicated,
it will be assumed that all Shares held by us for your account are to be
tendered.
** By executing and returning these Instructions, unless otherwise indicated,
it will be assumed that all Shares held by us for your account are to be
voted FOR the Proposed Amendment.
4
<PAGE>
Exhibit 99(a)(6)
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares. The Offers are made solely by the Offers to Purchase and
Proxy Statements and the related Letters of Transmittal and Proxy, and are being
made to all holders of Shares. Conectiv is not aware of any jurisdiction where
the making of the Offers or the tender of Shares is not in compliance with any
applicable law. If Conectiv becomes aware of any jurisdiction where the making
of the Offer or the tender of Shares is not in compliance with any applicable
law, Conectiv will make a good faith effort to comply with such law. If, after
such good faith effort, Conectiv cannot comply with such law, the Offers will
not be made to (nor will tenders be accepted from or on behalf of) the owners of
Shares residing in such jurisdiction. In any jurisdiction where the securities,
blue sky or other laws require the Offers to be made by a licensed broker or
dealer, the Offers shall be deemed to be made on behalf of Conectiv by Morgan
Stanley & Co. Incorporated or one or more registered brokers or dealers licensed
under the laws of such jurisdiction.
CONECTIV
NOTICE OF OFFER TO PURCHASE FOR CASH ANY AND ALL OUTSTANDING SHARES
OF THE FOLLOWING SERIES OF
ATLANTIC CITY ELECTRIC COMPANY
(THE "TENDER OFFER")
77,000 SHARES, CUMULATIVE PREFERRED STOCK,
4% SERIES AT A PURCHASE PRICE OF $81.60 PER SHARE
72,000 SHARES, CUMULATIVE PREFERRED STOCK,
4.10% SERIES AT A PURCHASE PRICE OF $83.50 PER SHARE
15,000 SHARES, CUMULATIVE PREFERRED STOCK,
4.35% SERIES AT A PURCHASE PRICE OF $88.60 PER SHARE
36,000 SHARES, CUMULATIVE PREFERRED STOCK,
4.35% 2ND SERIES AT A PURCHASE PRICE OF $88.60 PER SHARE
50,000 SHARES, CUMULATIVE PREFERRED STOCK,
4.75% SERIES AT A PURCHASE PRICE OF $96.75 PER SHARE
50,000 SHARES, CUMULATIVE PREFERRED STOCK,
5% SERIES AT A PURCHASE PRICE OF $100.00 PER SHARE
ATLANTIC CITY ELECTRIC COMPANY
(THE "PROXY SOLICITATION")
PROXY SOLICITATION FOR THE
OUTSTANDING SHARES OF THE FOLLOWING SERIES OF PREFERRED STOCK
239,500 SHARES, $7.80 NO PAR PREFERRED STOCK
FOR THE TENDER OFFER:
Conectiv ("Conectiv"), a Delaware corporation, invites the holders of each
series of preferred stock listed above under the Tender Offer (each, a "Series
of Preferred") of Atlantic City Electric Company (the "Company"), a New Jersey
corporation and direct utility subsidiary of Conectiv, to tender any and all of
their shares of a Series of Preferred (the "Shares") for purchase at the price
per Share listed above, net to the seller in cash, upon the terms and subject to
the conditions set forth in the Offer to Purchase and Proxy Statement dated
September 10, 1998 and in the related Letter of Transmittal and Proxy (which
together constitute the "Offer").
<PAGE>
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON OCTOBER 14, 1998 (THE "EXPIRATION DATE"), UNLESS THE OFFER IS EXTENDED.
THE OFFER FOR A SERIES OF PREFERRED IS NOT CONDITIONED UPON ANY MINIMUM
NUMBER OF SHARES OF SUCH SERIES OF PREFERRED BEING TENDERED AND IS INDEPENDENT
OF THE OFFER FOR ANY OTHER SERIES OF PREFERRED. THE OFFER, HOWEVER, IS
CONDITIONED UPON, AMONG OTHER THINGS, THE PROPOSED AMENDMENT, AS DESCRIBED
BELOW, BEING APPROVED AND ADOPTED AT THE SPECIAL MEETING. PREFERRED
SHAREHOLDERS OF THE COMPANY WHO WISH TO TENDER THEIR SHARES PURSUANT TO THE
OFFER MUST VOTE IN FAVOR OF THE PROPOSED AMENDMENT. SEE "TERMS OF THE OFFER --
CERTAIN CONDITIONS OF THE OFFER" IN THE OFFER TO PURCHASE AND PROXY STATEMENT.
The Board of Directors of the Company will consider the declaration of
dividends on the Company's capital stock at its meeting on September 24, 1998.
The Regular Quarterly Dividend on the Company's preferred stock, if, when and as
declared, will be paid on November 2, 1998 to holders of record as of the close
of business on October 2, 1998. A holder of record of Shares on October 2, 1998
who tenders Shares will be entitled to the Regular Quarterly Dividend,
regardless of when such tender is made. Holders of Shares purchased pursuant to
the Offer will not be entitled to any dividends in respect of any later dividend
periods.
Concurrently with the Offer, the Board of Directors of the Company is
soliciting proxies for use at the Special Meeting of Shareholders of the Company
to be held at Christiana Conference Center, 4100 South Wakefield Drive, Newark,
Delaware, on October 14, 1998 or any adjournment or postponement of such meeting
(the "Special Meeting"). The Special Meeting is being held to consider an
amendment (the "Proposed Amendment") to the Company's charter (the "Charter")
which would remove provisions of the Company's Charter that restrict the ability
of the Company to issue unsecured indebtedness. The Board of Directors of the
Company recommends voting FOR the Proposed Amendment.
HOLDERS OF A SERIES OF PREFERRED WHO WISH TO TENDER THEIR SHARES MUST VOTE
IN FAVOR OF THE PROPOSED AMENDMENT. HOWEVER, HOLDERS OF A SERIES OF PREFERRED
HAVE THE RIGHT TO VOTE FOR THE PROPOSED AMENDMENT REGARDLESS OF WHETHER THEY
TENDER THEIR SHARES. IF THE PROPOSED AMENDMENT IS APPROVED AND ADOPTED, THE
COMPANY WILL MAKE A SPECIAL CASH PAYMENT EQUAL TO $1.00 PER SHARE FOR EACH SHARE
PROPERLY VOTED IN FAVOR OF THE PROPOSED AMENDMENT, PROVIDED THAT SUCH SHARES
HAVE NOT BEEN TENDERED PURSUANT TO THE OFFER. THOSE HOLDERS OF PREFERRED STOCK
WHO VALIDLY TENDER THEIR SHARES WILL BE ENTITLED ONLY TO THE PURCHASE PRICE PER
SHARE LISTED ABOVE BUT NOT THE SPECIAL CASH PAYMENT.
IN ORDER TO VALIDLY TENDER SHARES PURSUANT TO THE OFFER, PREFERRED
SHAREHOLDERS WHO ACQUIRE SHARES DURING THE PERIOD BEGINNING TWO BUSINESS DAYS
PRIOR TO SEPTEMBER 14, 1998 AND UP TO AND INCLUDING THE EXPIRATION DATE MUST
OBTAIN AN ASSIGNMENT OF PROXY FROM THE SELLER OF SUCH SHARES AND VOTE SUCH PROXY
IN FAVOR OF THE PROPOSED AMENDMENT. IN ORDER TO FACILITATE THE TRANSFER OF
SHARES DURING THE PERIOD DESCRIBED ABOVE, THE SHARES OF EACH SERIES OF PREFERRED
WILL TRADE "WITH PROXY" IN THE OVER-THE-COUNTER MARKET. SETTLEMENT OF ALL TRADES
DURING THE PERIOD DESCRIBED ABOVE SHOULD INCLUDE AN ASSIGNMENT OF PROXY FROM THE
SELLER.
Any holder of a Series of Preferred desiring to accept the Offer and tender
all or any portion of his or her Shares should either (i) request his or her
broker, dealer, commercial bank, trust company or nominee to effect the
transaction for him or her, or (ii) complete and sign the Letter of Transmittal
and Proxy in accordance with the instructions in the Letter of Transmittal and
Proxy, mail or deliver the same and any other required documents to The Bank of
New York (the "Depositary"), and deliver the certificates for such Shares to the
Depositary, along with the Letter of Transmittal and Proxy, or tender such
Shares pursuant to the procedure for book-entry transfer set forth in the Offer
to Purchase and Proxy Statement under "Terms of the Offer -- Procedure for
Tendering Shares," on or prior to the Expiration Date (set forth above). A
holder of a Series of Preferred whose Shares are registered in the name of a
broker, dealer, commercial bank, trust company or nominee must contact such
broker, dealer, commercial bank, trust company or nominee if he or she desires
to tender such Shares. Any holder of a Series of Preferred who desires to
tender Shares and whose certificates for such Shares are not immediately
available, or who cannot comply in a timely manner with the procedure for book-
entry transfer, should tender such Shares by following the procedures for
guaranteed delivery set forth in the Offer to Purchase and Proxy Statement under
"Terms of the Offer -- Procedure for Tendering Shares." Conectiv will
2
<PAGE>
pay a solicitation fee for any Shares tendered, accepted for payment and paid
for pursuant to the Offer. See "Fees and Expenses Paid to Dealers" in the Offer
to Purchase and Proxy Statement.
CONECTIV RESERVES THE RIGHT AT ANYTIME, OR FROM TIME TO TIME, PRIOR TO THE
EXPIRATION DATE, TO EXTEND THE PERIOD OF TIME DURING WHICH THE OFFER IS OPEN OR
OTHERWISE AMEND OR TERMINATE THE OFFER FOR ANY REASON WITH RESPECT TO A SERIES
BY GIVING ORAL OR WRITTEN NOTICE TO TWO DEPOSITORY AND MAKING A PUBLIC
ANNOUNCEMENT THEREOF.
NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF DIRECTORS, NOR ANY
OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO
WHETHER TO TENDER ANY OR ALL SHARES. EACH SHAREHOLDER MUST MAKE HIS OR HER OWN
DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER.
THE OFFER TO PURCHASE AND PROXY STATEMENT AND THE RELATED LETTER OF
TRANSMITTAL AND PROXY CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE
ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
FOR THE PROXY SOLICITATION:
The Board of Directors of the Company is soliciting proxies of holders of
the shares of the series of preferred stock listed above under the Proxy
Solicitation (the "Proxy Only Shares") with respect to the Proposed Amendment.
The Special Meeting of Shareholders, at which the Proposed Amendment will be
considered, is scheduled to occur on October 14, 1998.
If the Proposed Amendment is approved and adopted, the Company will make a
special cash payment to each holder of Proxy Only Shares who properly voted his
Shares in favor of the Proposed Amendment in the amount of $1.00 per Share. If
a Preferred Shareholder votes against the Proposed Amendment or abstains, such
Preferred Shareholder shall not be entitled to the special cash payment
(regardless of whether the Proposed Amendment is approved and adopted).
--------------------
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager as set forth below. Requests for copies of the
Offer to Purchase and Proxy Statement and the related Letters of Transmittal
and Proxy or other tender offer or proxy materials may be directed to the
Information Agent and such copies will be furnished promptly at Conectiv's
expense. Preferred Shareholders may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offers.
The Information Agent for the Offer is:
D. F. KING & CO., INC.
77 Water Street, 20th Floor
New York, New York 10005
(800) 431-9629 (toll-free)
or Banks and Brokers call (212) 269-5550
The Dealer Manager for the Offer is:
MORGAN STANLEY DEAN WITTER
Liability Management Group
1585 Broadway, 2nd Floor
New York, New York 10036
Call Toll Free:
(800) 624-1808
September 11, 1998
3
<PAGE>
EXHIBIT 99(a)(7)
[LOGO] ATLANTIC ELECTRIC
SEPTEMBER 10, 1998
Dear Shareholder:
Please find enclosed important information pertaining to the following two
items:
(i) a proposed amendment (the "Proposed Amendment") to the charter (the
"Charter") of Atlantic City Electric Company (the "Company") which will be
considered at a Special Meeting (the "Special Meeting") of its
Shareholders; and
(ii) an offer by Conectiv ("Conectiv") to purchase certain outstanding
shares (the "Shares") of the Company's preferred stock.
We would greatly appreciate your giving prompt attention to the enclosed
material which you are urged to read in its entirety.
The Charter presently restricts the ability of the Company to issue
unsecured indebtedness without preferred shareholder approval under certain
circumstances. This restriction limits the Company's flexibility in planning
and financing its business activities. Because financial flexibility and
capital cost reduction are crucial factors to success in a competitive utility
environment, the Company ultimately may be placed at a competitive
disadvantage if these restrictions are not removed from the Charter. The
Proposed Amendment, as set forth and explained in the enclosed Offer to
Purchase and Proxy Statement, would remove this restriction.
Concurrently with the Company's proxy solicitation, Conectiv is offering to
purchase all of the outstanding shares of certain series of the Company's
preferred stock. NEITHER CONECTIV, THE COMPANY, THEIR RESPECTIVE BOARDS OF
DIRECTORS, NOR ANY OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO
ANY SHAREHOLDER AS TO WHETHER TO TENDER ANY OR ALL SHARES. EACH SHAREHOLDER
MUST MAKE HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SHARES AND IF SO,
HOW MANY SHARES TO TENDER. You must vote in favor of the Proposed Amendment in
order to tender your Shares. Conectiv's offer is conditioned upon the Proposed
Amendment being approved and adopted at the Special Meeting. In addition, you
have the right to vote for the Proposed Amendment regardless of whether you
tender your shares. If you vote in favor of the Proposed Amendment and it
passes, you will be entitled to receive a special cash payment equal to $1.00
per Share for each Share properly voted in favor of the Proposed Amendment,
provided your shares have not been tendered. Instructions for tendering your
shares and information pertaining to the special cash payment are included
with the enclosed material.
Your Board of Directors recommends voting FOR the Proposed Amendment. It is
important to your interests that all shareholders, regardless of the number of
shares owned, vote at the Special Meeting. Even if you plan to attend the
Special Meeting, WE URGE YOU TO MARK, SIGN AND DATE THE ENCLOSED PROXY, WHICH
IS INCLUDED WITHIN THE ENCLOSED LETTER OF TRANSMITTAL AND PROXY, AND RETURN IT
PROMPTLY. By signing and returning your proxy promptly, you are assuring that
your shares will be voted.
You are invited to attend the Special Meeting which will be held at
Christiana Conference Center, 4100 South Wakefield Drive, Newark, Delaware on
October 14, 1998 at 4:00 p.m., Eastern time.
If you have questions regarding the Proposed Amendment, the Special Meeting
or Conectiv's tender offer, please call D.F. King & Co., Inc., the Information
Agent, at (800) 431-9629 (toll free) and (212) 269-5550 (banks and brokers) or
Morgan Stanley at (800) 624-1808 (toll free).
Thank you for your continued interest in the Company.
Sincerely yours,
LOGO
Howard E. Cosgrove Chairman and
Chief Executive Officer
<PAGE>
EXHIBIT 99(a)(8)
[LOGO] CONECTIV
September 10, 1998
CONECTIV OFFERS TO PURCHASE PREFERRED STOCK
Conectiv announced today offers to purchase certain series of the
outstanding shares of preferred stock of its subsidiary Atlantic City Electric
Company ("ACE").
The company also announced that ACE is soliciting proxies for use at a
special meeting of preferred shareholders, scheduled for October 14, 1998. The
meeting would be to consider an amendment to ACE's charter. The amendment
would eliminate a restriction on the subsidiary's ability to issue unsecured
indebtedness without preferred stockholder approval under certain
circumstances.
"The change we're asking ACE preferred stockholders to consider would make
Conectiv more agile in a competitive environment," said Barbara S. Graham,
Conectiv's Chief Financial Officer. "We're hoping to eliminate a certain
charter restriction to gain financial flexibility as we move toward a more
competitive energy market."
The offers to purchase certain series of preferred stock will expire 5 p.m.
Eastern time October 14, 1998, unless any offer is extended.
Purchase prices for each issue are indicated below:
<TABLE>
<CAPTION>
SERIES CUSIP NUMBER PURCHASE PRICE PER SHARE
- ------ ------------ ------------------------
<S> <C> <C>
ATLANTIC CITY ELECTRIC COMPANY,
CUMULATIVE PREFERRED STOCK
($100 PAR VALUE)
4% Series............................... 048303200 $ 81.60
and
048303903
4.10% Series............................ 048303770 $ 83.50
4.35% Series............................ 048303762 $ 88.60
4.35% 2nd Series........................ 048303762 $ 88.60
4.75% Series............................ 048303309 $ 96.75
5% Series............................... 048303788 $100.00
</TABLE>
The Board of Directors of ACE will consider the declaration of dividends on
ACE's capital stock at its meeting on September 24, 1998. The Regular
Quarterly Dividend on ACE's preferred stock, if, when and as declared, will be
paid on November 2, 1998 to holders of record as of the close of business on
October 2, 1998. A holder of record of shares of ACE's preferred stock on
October 2, 1998 who tenders shares will be entitled to the Regular Quarterly
Dividend, regardless of when such tender is made. Holders of shares of ACE's
preferred stock purchased pursuant to the offers will not be entitled to any
dividends in respect of any later dividend periods.
The dealer manager for the tender offers is Morgan Stanley Dean Witter. The
information agent is D.F. King & Co., Inc. Shareholder questions or requests
for assistance may be directed to the information agent at (800) 431-9629
(toll free) or to Morgan Stanley at (800) 624-1808 (toll free).
The Conectiv family of companies includes Delmarva Power & Light Company,
Atlantic City Electric Company, Conectiv Communications (telecommunications),
Conectiv Services (HVAC services), Conectiv Energy (retail electric and gas),
Conectiv Energy Supply (bulk and wholesale electric and gas), Conectiv
Solutions (energy services) and Conectiv Thermal (district heating/cooling).
# # # # #
<PAGE>
IMPORTANT NOTES:
Each of the offers for a series of preferred stock is independent of the
offers for the other series and is not conditioned upon any minimum number of
shares of such series being tendered. Each offer is conditioned upon, among
other things, the proposed charter amendment being approved and adopted at the
respective company's special meeting. Shareholders who wish to tender their
shares must vote in favor of the proposed charter amendment.
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell shares. The offers are made solely by the Offer to Purchase and
Proxy Statement, dated September 10, 1998, and the related Letters of
Transmittal and Proxy and are not being made to (nor will tenders be accepted
from or on behalf of) owners of shares residing in any jurisdiction which the
making of the offers or the acceptance thereof would not be in compliance with
the laws of such jurisdiction. In any jurisdiction, the laws of which require
the offers to be made by a licensed broker or dealer, the offers shall be
deemed made on behalf of Conectiv by Morgan Stanley & Co. Incorporated or one
or more registered brokers or dealers licensed under the laws of such
jurisdiction. This announcement is also not a solicitation of proxies, which
is made only by the Proxy Statement, dated September 10, 1998, and such Offer
to Purchase and Proxy Statement.
2
<PAGE>
EXHIBIT 99(a)(9)
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYOR -- Social Security numbers have nine digits separated by two hyphens:
i.e. 000-00-0000. Employer identification numbers have nine digits separated
by only one hyphen: i.e. 00-0000000. The table below will help determine the
number to give the payor.
<TABLE>
- -------------------------------------------
<CAPTION>
GIVE THE
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT: NUMBER OF --
- -------------------------------------------
<S> <C>
1. An individual's The individual
account
2. Two or more The actual owner
individuals (joint of the account
account) or, if combined
funds, the first
individual on
the account(1)
3. Custodian account of The minor(2)
a minor (Uniform Gift
to Minors Act)
4.a. The usual revocable The grantor-
savings trust trustee(1)
account (grantor is
also trustee)
b. So-called trust The actual
account that is not owner(1)
a legal or valid
trust under State
Law
5. Sole proprietorship The owner(3)
account
</TABLE>
<TABLE>
----------------------------------------------------------------
<CAPTION>
GIVE THE
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT: NUMBER OF --
----------------------------------------------------------------
<S> <C>
6. A valid trust, estate, or pension trust The legal entity
(Do not furnish
the identifying
number of the
personal
representative
or trustee
unless the legal
entity itself is
not designated
in the account
title)(4)
7. Corporate account The corporation
8. Association, club, religious, charitable, educational or other tax-exempt organization The organization
9. Partnership account The partnership
10. A broker or registered nominee The broker or
nominee
11. Account with the Department of Agriculture in the name of a public entity (such as a State or local The public
government, school district or prison) that receives agricultural program payments entity
</TABLE>
- -------------------------------------- --------------------------------------
(1) List first and circle the name of the person whose number you furnish. If
only one person on a joint account has a social security number, that
person's number must be furnished.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Show the name of the owner. May also use business name and its Employer
Identification Number (if any).
(4) List first and circle the name of the valid trust, estate, or pension
trust.
NOTE: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER (TIN) ON SUBSTITUTE FORM W-9
(SECTION REFERENCES ARE TO THE INTERNAL REVENUE CODE)
PAGE 2
NAME
If you are an individual, generally provide the name shown on your social
security card. However, if you have changed your last name, for instance, due
to marriage, without informing the Social Security Administration of the name
change, please enter your first name and both the last name shown on your
social security card and your new last name.
OBTAINING A NUMBER
If you don't have a taxpayer identification number ("TIN"), apply for one
immediately. To apply, obtain Form SS-5, Application for a Social Security
Number Card, Form SS-4, Application for Employer Identification Number, or, if
you are a U.S. resident alien for U.S. tax purposes, Form W-7, Application for
IRS Individual Taxpayer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service (the "IRS").
PAYEES EXEMPT FROM BACKUP WITHHOLDING
The following is a list of payees exempt from backup withholding and for which
no information reporting is required. For interest and dividends, all listed
payees are exempt except item (9). For broker transactions, payees listed in
(1) through (13), and a person registered under the Investment Advisors Act of
1940 who regularly acts as a broker are exempt. Payments subject to reporting
under sections 6041 and 6041A are generally exempt from backup withholding
only if made to payees described in items (1) through (7), except that a
corporation that provides medical and health care services or bills and
collects payments for such services is not exempt from backup withholding or
information reporting.
(1) A corporation.
(2) An organization exempt from tax under section 501(a), or an individual
retirement plan ("IRA"), or a custodial account under section 403(b)(7).
(3) The United States or any agencies or instrumentalities.
(4) A state, the District of Columbia, a possession of the United States, or
any of their political subdivisions or instrumentalities.
(5) A foreign government or any of its political subdivisions, agencies or
instrumentalities.
(6) An international organization or any of its agencies or
instrumentalities.
(7) A foreign central bank of issue.
(8) A dealer in securities or commodities required to register in the U.S.
or a possession of the U.S.
(9) A futures commission merchant registered with the Commodity Futures
Trading Commission.
(10) A real estate investment trust.
(11) An entity registered at all times during the tax year under the
Investment Company Act of 1940.
(12) A common trust fund operated by a bank under section 584(a).
(13) A financial institution.
(14) A middleman known in the investment community as a nominee or listed in
the most recent publication of the American Society of Corporate
Secretaries, Inc. Nominee List.
(15) A trust exempt from tax under section 664 or described in section 4947.
PAYMENTS EXEMPT FROM BACKUP WITHHOLDING
Payments of dividends generally not subject to backup withholding also include
the following:
--Payments to nonresident aliens subject to withholding under section 1441.
--Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident alien partner.
--Payments made by certain foreign organizations.
--Payments of interest generally not subject to backup withholding include
the following:
--Payments of interest on obligations issued by individuals.
NOTE: You may be subject to backup withholding if this interest is $600 or
more and is paid in the course of the payor's trade or business and you
have not provided your correct TIN to the payor.
--Payments of tax-exempt interest (including exempt interest dividends under
section 852).
--Payments described in section 6049(b)(5) to nonresident aliens.
--Payments on tax-free covenant bonds under section 1451.
--Payments made by certain foreign organizations.
--Mortgage interest paid by you.
Payments that are not subject to information reporting are also not subject
to backup withholding. For details, see sections 6041, 6041A(a), 6042, 6044,
6045, 6049, 6050A, and 6050N, and the regulations under those sections.
PRIVACY ACT NOTICE.--Section 6109 requires you to furnish your correct TIN to
persons who must file information returns with the IRS to report interest,
dividends and certain other income paid to you, mortgage interest you paid,
the acquisition or abandonment of secured property, or contributions you made
to an IRA. The IRS uses the numbers for identification purposes and to help
verify the accuracy of your tax return. The IRS may also provide this
information to the Department of Justice for civil and criminal litigation and
to cities, states and the District of Columbia to carry out their tax laws.
You must provide your TIN whether or not you are qualified to file a tax
return. Payors must generally withhold 31% of taxable interest, dividend, and
certain other payments to a payee who does not furnish a TIN to a payor.
Certain penalties may also apply.
PENALTIES
(1) FAILURE TO FURNISH TIN.--If you fail to furnish your correct TIN to a
payor, you are subject to a penalty of $50 for each such failure unless
your failure is due to reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis that results in no
imposition of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Willfully falsifying
certifications or affirmations may subject you to criminal penalties
including fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE IRS
<PAGE>
EXHIBIT 99(a)(10)
SUMMARY INSTRUCTIONS FOR PARTICIPATING IN THE TENDER OFFER AND PROXY
(1) CHECK CONTENTS OF PACKAGE. Before proceeding, please confirm that this
package contains each of the following materials:
-- Letter from the Chairman and Chief Executive Officer.
--Offer to Purchase and Proxy Statement dated September 10, 1998.
--Letter of Transmittal and Proxy relating to the applicable series of
Preferred stock.
--Notice of Guaranteed Delivery and Proxy.
--Return envelope addressed to The Bank of New York, the Depositary for
the Tender Offer.
--W-9 Instruction Form.
(2) REVIEW MATERIALS CAREFULLY BEFORE DECIDING WHETHER TO PARTICIPATE. Please
review all enclosed materials carefully before deciding whether to
participate in the tender offer.
-- IF YOUR SHARES ARE REGISTERED IN YOUR NAME and you decide to
participate, you must follow the instructions in paragraphs (3) and
(4) below.
-- IF YOUR SHARES ARE HELD BY A BROKER OR BANK FOR YOUR ACCOUNT and you
decide to participate, you must contact your broker or bank and
advise them to execute your instructions on your behalf.
(3) COMPLETE THE APPLICABLE LETTER OF TRANSMITTAL AND PROXY. You must follow
these instructions to complete the Letter of Transmittal and Proxy.
(a) TENDER OFFER AND PROXY. If you wish to tender your shares pursuant to
the Tender Offer, you must vote FOR Proposal 1.
-- Indicate your vote by an (X) on page 3 of the Letter of Transmittal
and Proxy. Sign and date the box entitled "Signature(s) of Owner(s)"
and print your capacity, address and daytime telephone number.
-- Complete the box entitled "Description of Shares Tendered" on page 4
of the Letter of Transmittal and Proxy.
-- Only complete the "Guarantee of Signature" section if the signatures
are different from the registration on the face of the certificate.
-- Complete, sign and date the box entitled "Substitute Form W-9."
-- The following sections of the Letter of Transmittal and Proxy should
be completed only if applicable:
-- Notice of Guaranteed Delivery: If you cannot deliver your
preferred stock certificate(s) to the Depositary before October
14, 1998, a broker must guarantee delivery of your shares. The
broker must complete the application portion of page 4 of the
Letter of Transmittal and Proxy and submit the separate document
entitled "Notice of Guaranteed Delivery and Proxy."
-- Soliciting Dealer: If your tender has been solicited by a
Soliciting Dealer, please complete the box entitled "Solicited
Tenders" on page 10 of the Letter of Transmittal and Proxy.
-- Special Payment and Special Delivery Instructions: If you would
like the check for the purchase price of shares purchased
pursuant to the Tender Offer or the certificates for shares not
purchased to be issued in the name of someone other than the
current holder or to be
1
<PAGE>
mailed to someone other than the current holder, or to the
current holder at an address other than that shown on the current
certificate, please complete the boxes on page 9 entitled
"Special Payment Instructions" and/or "Special Delivery
Instructions" in the Letter of Transmittal and Proxy. To do
either of these, you must have your signature guaranteed by an
eligible institution. (See Instructions 1 and 5 on the Letter of
Transmittal and Proxy with respect to guarantee of signature by
an eligible institution).
(b) PROXY ONLY. If you choose only to vote the proxy and will not tender
your shares pursuant to the Tender Offer, please follow these
instructions:
-- Indicate your vote by an (X) on page 3 of the Letter of Transmittal
and Proxy. Sign and date the box entitled "Signature(s) of Owner(s)"
and print your capacity, address and daytime telephone number.
-- Complete, sign and date the box entitled "Substitute Form W-9."
-- The following sections of the Letter of Transmittal and Proxy should
be completed only if applicable:
-- If you would like the Special Cash Payment to be issued to or
mailed to someone other than the current holder, please complete
the boxes entitled "Special Payment Instructions" and/or "Special
Delivery Instructions" on page 9 of the Letter of Transmittal and
Proxy. To do either of these, you must have your signature
guaranteed by an eligible institution. (See Instructions 1 and 5
on the Letter of Transmittal and Proxy with respect to guarantee
of signatures by an eligible institution.)
(4) MAIL UNSIGNED PREFERRED STOCK CERTIFICATES AND SIGNED LETTER OF
TRANSMITTAL AND PROXY TO THE DEPOSITARY. Send the applicable Letter of
Transmittal and Proxy to The Bank of New York, as Depositary, at the
address shown on the Letter of Transmittal and Proxy. If you own more than
one series of preferred stock, you must complete the specific Letter of
Transmittal and Proxy that relates to each individual series. Use of
registered or certified mail is recommended. PLEASE NOTE: If you are not
tendering, DO NOT send in your certificates.
IF YOU HAVE ANY QUESTIONS, HAVE NOT RECEIVED THE APPLICABLE LETTER(S) OF
TRANSMITTAL AND PROXY OR OTHER DOCUMENTS PERTAINING TO THE TENDER OFFER, OR
NEED ASSISTANCE IN COMPLETING THE APPLICABLE FORMS, PLEASE CONTACT THE
INFORMATION AGENT: D.F. KING & CO., INC. AT (800) 431-9629 (TOLL-FREE).
2
<PAGE>
EXHIBIT 99(a)(11)
URGENT NOTICE
, 1998
Dear Preferred Shareholder:
The Special Meeting of Shareholders of Atlantic City Electric Company is
scheduled to be held on October 14, 1998, and we have attempted to contact you
by telephone to discuss the important agenda. To date we have been unable to
reach you by phone.
It is extremely important that we discuss this critical Special Meeting and
the events surrounding it. We would appreciate it if you would take a moment
and please call during business hours our Information Agent, D.F. King & Co.,
Inc. at (800) 431-9629 (toll free).
Thank you for your interest in the affairs of Atlantic City Electric
Company. I appreciate your cooperation.
Sincerely,
Howard E. Cosgrove
Howard E. Cosgrove
Chairman and Chief Executive Officer
<PAGE>
EXHIBIT 99(a)(12)
ATLANTIC CITY ELECTRIC COMPANY
PROXY FORM FOR DTC PARTICIPANTS ONLY
The undersigned hereby appoints Howard E. Cosgrove, Barbara S. Graham and
Louis M. Walters, or any of them as proxies, each with the power to appoint
his or her substitute, and hereby authorizes them to represent and to vote as
designated hereunder and in their discretion with respect to any other
business properly brought before the Special Meeting all the shares of
preferred stock of the company which the undersigned is entitled to vote at
the Special Meeting or any adjournments or postponements thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
The proxy contained herein, when properly executed, will be voted in the
manner directed herein by the undersigned shareholders. If no direction is
made, the proxy will be voted FOR Item 1. An abstention is the equivalent of a
vote AGAINST the Proposed Amendment.
Indicate your vote by an (X). The Board of Directors recommends voting FOR
Item 1.
ITEM 1.
To remove from the Company's charter, Paragraph (7)(B)(c) of Article III, a
provision restricting the amount of securities representing unsecured
indebtedness issuable by the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED IN
ACCORDANCE WITH INSTRUCTIONS APPEARING ON THIS PROXY IN THE ABSENCE OF
SPECIFIC INSTRUCTIONS. PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE SPECIAL
METING.
<TABLE>
<CAPTION>
CUSIP # SERIES FOR AGAINST ABSTAIN
<S> <C> <C> <C> <C>
048303200 and 048303903 4%
048303770 4.10%
048303762 4.35%
048303507 4.35% 2nd Series
048303309 4.75%
048303788 5%
</TABLE>
NOTICE: THE ABOVE BANK OR BROKER HEREBY CERTIFIES THAT IT HAS NOT GIVEN AND
WILL NOT GIVE INSTRUCTIONS TO TENDER ANY SHARES LISTED ABOVE THROUGH THE DTC
ATOP SYSTEM.
ATTENTION ALL DTC PARTICIPANTS: PLEASE USE THIS PROXY FORM FOR VOTING ON ANY
AND ALL ISSUES. DO NOT USE THE BENEFICIAL OWNER PROXY FORM.
Date:
Date: _______________________________ Authorized Signature: _______________
DTC Participant Name: _______________ Print Name: _________________________
DTC Participant Number:: ____________ Telephone Number: ___________________
Number of Firm: _____________________
Address: ____________________________
Medallion Stamp:
<PAGE>
Exhibit 99(d)
September 10, 1998
Conectiv
800 King Street
Wilmington, Delaware 19899
Atlantic City Electric Company
800 King Street
Wilmington, Delaware 19899
Ladies and Gentlemen:
We have acted as special counsel to Conectiv ("Conectiv") and Atlantic City
Electric Company ("ACE") in connection with the Company's tender offer for any
and all of the outstanding shares of certain shares of cumulative preferred
stock (as listed on Schedule A attached hereto) of ACE (the "Preferred").
We have examined (i) the Offer to Purchase and Proxy Statement for the
Preferred dated September 10, 1998 (the "Offer to Purchase and Proxy
Statement"), which incorporated by reference the annual reports on Form 10-K of
Conectiv and ACE for the fiscal year ended December 31, 1997, the Quarterly
Reports on Form 10-Q of Conectiv and ACE for the interim periods ended March 31,
1998 and June 30, 1998, and the Current Reports on Form 8-K of Conectiv, dated
March 6, 1998, March 9, 1998, April 23, 1998 and August 3, 1998 and ACE, dated
February 27, 1998, March 3, 1998 and March 5, 1998 (the "OPPS Exchange Act
Documents"), each as filed under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), (ii) the Schedule 13E-4 for the Preferred, dated September
10, 1998, filed by the Company under the Exchange Act, including the related
exhibits thereto, which Schedule 13E-4 incorporates by reference the OPPS
Exchange Act Documents and the Quarterly Reports on Form 10-Q of ACE for the
quarterly periods ended March 31, 1998 and June 30, 1998, each as filed under
the Exchange Act and (iii) the Letters of Transmittal and Proxy for the
Preferred. In addition, we have examined, and have relied as to matters of fact
upon, the originals or copies, certified or otherwise identified to our
satisfaction, of such corporate records, agreements, documents and other
instruments and such certificates or comparable documents of public officials
and of officers and representatives of Conectiv and ACE, and have made such
other and further investigations as we have deemed relevant and necessary as a
basis for the opinion hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures, the
legal capacity of all natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as drafts or as certified, conformed photostatic or
facsimile copies, and the authenticity of originals of such latter documents.
Based upon the foregoing, and subject to the qualifications and limitations
stated herein, we hereby advise you that the statements made in the Offer to
Purchase and Proxy Statement under the caption "Certain Federal Income Tax
Consequences," insofar as they purport to constitute summaries of matters of
United States federal income tax law and regulations or legal conclusions with
respect thereto, constitute accurate summaries of the matters described therein
in all material respects.
We are members of the Bar of the State of New York and we do not express any
opinion herein concerning any law other than the federal income tax law of the
United States.
Very truly yours,
/s/ Simpson Thacher & Bartlett
SIMPSON THACHER & BARTLETT
<PAGE>
SCHEDULE A
LIST OF THE SHARES
Atlantic City Electric Company
1. Cumulative Preferred Stock, 4% Series ($100 par value)
2. Cumulative Preferred Stock, 4.10% Series ($100 par value)
3. Cumulative Preferred Stock, 4.35% Series ($100 par value)
4. Cumulative Preferred Stock, 4.35% 2nd Series ($100 par value)
5. Cumulative Preferred Stock, 4.75% Series ($100 par value)
6. Cumulative Preferred Stock, 5% Series ($100 par value)
2
