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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-3375
South Carolina Electric & Gas Company
(Exact name of registrant as specified in its charter)
South Carolina 57-0248695
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1426 Main Street, Columbia, South Carolina 29201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (803) 748-3000
Former name, former address and former fiscal year, if changed since last
report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X . No .
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the distribution of
securities under a plan confirmed by a court. Yes . No .
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
As of July 31, 1994, there were issued and outstanding 40,296,147
shares of the registrant's common stock $4.50 par value, all of which
were held, beneficially and of record, by SCANA Corporation.
1
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1994
and December 31, 1993......................................... 3
Consolidated Statements of Income and Retained Earnings
for the Periods Ended June 30, 1994 and 1993.................. 5
Consolidated Statements of Cash Flows for the Periods
Ended June 30, 1994 and 1993.................................. 6
Notes to Consolidated Financial Statements...................... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................ 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.......................................... 12
Item 6. Exhibits and Reports on Form 8-K........................... 12
Signatures............................................................. 13
Exhibit Index.......................................................... 14
2
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<TABLE>
PART I
FINANCIAL INFORMATION
SOUTH CAROLINA ELECTRIC & GAS COMPANY
CONSOLIDATED BALANCE SHEETS
As of June 30, 1994 and December 31, 1993
(Unaudited)
<S> <C> <S><C> <S><C>
June 30, December 31,
1994 1993
(Thousands of Dollars)
ASSETS
Utility Plant:
Electric............................................. $3,082,443 $3,067,881
Gas.................................................. 296,477 272,506
Transit.............................................. 3,774 3,769
Common............................................... 75,983 72,804
Total.............................................. 3,458,677 3,416,960
Less accumulated depreciation and amortization....... 1,148,798 1,097,531
Total.............................................. 2,309,879 2,319,429
Construction work in progress........................ 471,804 338,677
Nuclear fuel, net of accumulated amortization........ 31,541 29,087
Utility Plant, Net............................... 2,813,224 2,687,193
Nonutility property and investments (net of
accumulated depreciation)............................ 12,609 12,709
Current Assets:
Cash and temporary cash investments.................. 1,967 193
Receivables - customer and other..................... 117,294 119,296
Receivables - affiliated companies................... 23,859 244
Inventories (at average cost):
Fuel............................................... 26,410 31,192
Materials and supplies............................. 43,767 43,372
Prepayments.......................................... 15,991 10,089
Accumulated deferred income taxes.................... 2,057 9,015
Total Current Assets............................. 231,345 213,401
Deferred Debits:
Unamortized debt expense............................. 10,731 11,060
Unamortized deferred return on plant investment...... 12,737 14,860
Nuclear plant decommissioning fund................... 27,743 25,103
Other................................................ 238,649 225,613
Total Deferred Debits............................ 289,860 276,636
Total................................. $3,347,038 $3,189,939
See notes to consolidated financial statements.
3
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
CONSOLIDATED BALANCE SHEETS
As of June 30, 1994 and December 31, 1993
(Unaudited)
<S> <C> <S> <C> <S> <C>
June 30, December 31,
1994 1993
(Thousands of Dollars)
CAPITALIZATION AND LIABILITIES
Stockholders' Investment:
Common Equity:
Common stock ($4.50 par value)...................... $ 181,333 $ 181,333
Premium on common stock and other paid-in capital... 614,160 583,785
Capital stock expense (debit)....................... (5,467) (5,497)
Retained earnings................................... 300,700 291,713
Total Common Equity............................... 1,090,726 1,051,334
Preferred stock (Not subject to purchase or sinking
funds).............................................. 26,027 26,027
Total Stockholders' Investment.................... 1,116,753 1,077,361
Preferred stock, net (Subject to purchase or
sinking funds)........................................ 50,856 52,840
Long-term debt, net..................................... 1,199,752 1,097,043
Total Capitalization............................ 2,367,361 2,227,244
Current Liabilities:
Short-term borrowings................................. 15,500 1,011
Current portion of long-term debt..................... 16,651 13,719
Current portion of preferred stock.................... 2,486 2,504
Accounts payable...................................... 36,344 68,182
Accounts payable - affiliated companies............... 37,484 28,630
Estimated rate refunds and related interest........... 1,871 2,509
Customer deposits..................................... 12,405 12,207
Taxes accrued......................................... 22,465 39,965
Interest accrued...................................... 17,758 17,764
Dividends declared.................................... 31,122 29,982
Other................................................. 19,159 10,042
Total Current Liabilities....................... 213,245 226,515
Deferred Credits:
Accumulated deferred income taxes..................... 487,480 480,808
Accumulated deferred investment tax credits........... 83,155 84,447
Accumulated reserve for nuclear plant decommissioning. 27,743 25,103
Other................................................. 168,054 145,822
Total Deferred Credits.......................... 766,432 736,180
Total ................................. $3,347,038 $3,189,939
See notes to consolidated financial statements.
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
For the Periods Ended June 30, 1994 and 1993
(Unaudited)
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Three Months Ended Six Months Ended
June 30, June 30,
1994 1993 1994 1993
(Thousands of Dollars)
OPERATING REVENUES:
Electric.......................................... $225,219 $214,070 $460,108 $421,716
Gas............................................... 36,866 29,387 114,278 100,194
Transit........................................... 948 1,028 1,969 1,816
Total Operating Revenues..................... 263,033 244,485 576,355 523,726
OPERATING EXPENSES:
Fuel used in electric generation.................. 46,940 41,092 87,933 76,913
Purchased power (including affiliated
purchases)...................................... 21,824 26,784 50,292 52,459
Gas purchased from affiliate for resale........... 24,444 18,399 68,399 58,216
Other operation................................... 53,971 50,935 105,348 97,516
Maintenance....................................... 14,972 15,477 29,697 30,954
Depreciation and amortization..................... 26,752 25,249 53,442 50,574
Income taxes...................................... 13,497 10,311 39,925 28,276
Other taxes....................................... 17,317 17,304 34,483 34,611
Total Operating Expenses..................... 219,717 205,551 469,519 429,519
OPERATING INCOME.................................... 43,316 38,934 106,836 94,207
OTHER INCOME:
Allowance for equity funds used
during construction............................. 1,911 2,413 3,984 4,751
Other income (loss),net of income taxes........... (162) (282) (263) (494)
Total Other Income........................... 1,749 2,131 3,721 4,257
INCOME BEFORE INTEREST CHARGES...................... 45,065 41,065 110,557 98,464
INTEREST CHARGES (CREDITS):
Interest expense.................................. 22,396 21,156 44,171 43,550
Allowance for borrowed funds used
during construction............................. (1,679) (1,418) (3,302) (3,233)
Total Interest Charges, Net.................. 20,717 19,738 40,869 40,317
NET INCOME.......................................... 24,348 21,327 69,688 58,147
Preferred Stock Cash Dividends (at stated
rates)............................................ (1,462) (1,564) (3,001) (3,131)
Earnings Available for Common Stock................. 22,886 19,763 66,687 55,016
Retained Earnings at Beginning of Period............ 307,414 270,515 291,713 262,262
Common Stock Cash Dividends Declared................ (29,600) (27,500) (57,700) (54,500)
Retained Earnings at End of Period.................. $300,700 $262,778 $300,700 $262,778
See notes to consolidated financial statements.
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Periods Ended June 30, 1994 and 1993
(Unaudited)
<S> <C> <C> <S> <C>
Six Months Ended
June 30,
1994 1993
(Thousands of Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income........................................... $ 69,688 $ 58,147
Adjustments to reconcile net income to net cash
provided from operating activities:
Depreciation and amortization...................... 53,520 50,649
Amortization of nuclear fuel....................... 8,885 6,920
Deferred income taxes, net......................... 13,167 35,083
Deferred investment tax credits, net............... (1,292) (1,622)
Net regulatory asset-adoption of SFAS No. 109...... (1,630) (23,998)
Nuclear refueling accrual.......................... 3,763 (9,143)
Allowance for funds used during construction....... (7,286) (7,984)
Over (under) collections, fuel adjustment clause... (2,018) (1,004)
Changes in certain current assets and liabilities:
(Increase) decrease in receivables................ (21,613) (3,607)
(Increase) decrease in inventories................ 4,387 6,144
Increase (decrease) in accounts payable........... (21,423) (22,862)
Increase (decrease) in estimated rate refunds
and related interest............................ (638) (15,011)
Increase (decrease) in taxes accrued.............. (17,500) (19,135)
Other, net......................................... 21,648 (6,603)
Net Cash Provided From Operating Activities............ 101,658 45,974
CASH FLOWS FROM INVESTING ACTIVITIES:
Utility property additions and construction
expenditures....................................... (193,867) (126,371)
Increase in other property and investments........... (322) (75)
Principal noncash items:
Allowance for funds used during construction....... 7,286 7,984
Transfer of assets from SCANA...................... 6,285 -
Net Cash Used For Investing Activities................. (180,618) (118,462)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds:
Issuance of other long-term debt................... 99,000 -
Issuance of First Mortgage Bonds................... - 100,000
Equity contribution from parent.................... 24,120 27,507
Repayments:
First and Refunding Mortgage Bonds................. - (47,965)
Other long-term debt............................... (796) (25)
Preferred stock.................................... (2,002) (1,991)
Dividend payments:
Common stock....................................... (56,500) (53,741)
Preferred stock.................................... (3,061) (3,169)
Short-term borrowings, net........................... 14,489 54,391
Fuel financings, net................................. 7,043 (3,855)
Advances - affiliated companies, net................. (1,559) (1,697)
Net Cash Provided From Financing Activities............ 80,734 69,455
NET INCREASE (DECREASE) IN CASH AND
TEMPORARY CASH INVESTMENTS........................... 1,774 (3,033)
CASH AND TEMPORARY CASH INVESTMENTS AT JANUARY 1....... 193 24,302
CASH AND TEMPORARY CASH INVESTMENTS AT JUNE 30......... $ 1,967 $ 21,269
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for - Interest (includes capitalized
interest of $3,302 and $3,233)...... $ 66,057 $ 42,549
- Income taxes......................... 29,963 21,814
See notes to consolidated financial statements.
</TABLE>
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1994
(Unaudited)
The following notes should be read in conjunction with the
Notes to Consolidated Financial Statements appearing in the
Company's Annual Report on Form 10-K for the year ended
December 31, 1993. These are interim financial statements and,
because of temperature variations between seasons of the year, the
amounts reported in the Consolidated Statements of Income are not
necessarily indicative of amounts expected for the year. In the
opinion of management, the information furnished herein reflects
all adjustments, all of a normal recurring nature, which are
necessary for a fair statement of the results for the interim
periods reported.
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
A. Principles of Consolidation:
The Company, a public utility, is a South Carolina
corporation organized in 1924 and a wholly owned subsidiary
of SCANA Corporation (SCANA), a South Carolina holding
company. The accompanying Consolidated Financial Statements
include the accounts of the Company and South Carolina Fuel
Company, Inc. (Fuel Company), an affiliate. Intercompany
balances and transactions between the Company and Fuel
Company have been eliminated in consolidation.
The assets of the former Peoples Natural Gas Company of
South Carolina, which were owned by SCANA and operated by
the Company, were transferred to the Company on January 1,
1994. The transaction did not have a significant impact on
the Company's financial position or results of operations.
The Company has entered into agreements with certain
affiliates to purchase gas for resale to its distribution
customers and to purchase electric energy. The Company
purchases all of its natural gas requirements from South
Carolina Pipeline Corporation. The Company purchases all
of the electric generation of Williams Station, which is
owned by South Carolina Generating Company, Inc., under a
unit power sales agreement. Such unit power purchases are
included in "Purchased power."
B. Classification of Short-Term Obligations:
On July 21, 1994 the Company issued $100 million of First
Mortgage Bonds, 7.70% series due July 15, 2004 to repay
short-term borrowings in a like amount. Accordingly,
short-term borrowings in the amount of $99 million are
included in "Long-term debt, net."
C. Reclassifications:
Certain amounts from prior periods have been reclassified
to conform with the 1994 presentation.
2. RATE MATTERS:
With respect to rate matters at June 30, 1994, reference is
made to Note 2 of Notes to Consolidated Financial
Statements in the Company's Annual Report on Form
10-K for the year ended December 31, 1993. No changes
have occurred with respect to those matters as reported
therein except as shown below.
On May 18, 1994 the Federal Energy Regulatory Commission
(FERC) ordered the Company to refund certain amounts to its
wholesale customers. The refund was ordered because the
retail rate on which wholesale rates were based had been
reduced and refunds had been made to retail customers in
response to an order of the South Carolina Public Service
Commission (PSC) issued on January 19, 1993. The Company
refunded $1.1 million, including interest, to its wholesale
customers on July 28, 1994.
In June 1994 the Company placed into effect the second
phase of the retail electric rate increase approved by the
PSC on June 7, 1993. The new rates will produce an
increase in electric operating revenue of $18.5 million
annually, based on a test year.
On June 6, 1994 the PSC issued an order denying the
Company's request that the $.40 fare for low income riders
of the Company's transit system be eliminated. The Company
has appealed the PSC's order to the South Carolina Circuit
Court.
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3. RETAINED EARNINGS:
The Restated Articles of Incorporation of the Company and
the Indenture underlying certain of its bond issues contain
provisions that may limit the payment of cash dividends on
common stock. In addition, with respect to hydroelectric
projects, the Federal Power Act may require the
appropriation of a portion of the earnings therefrom.
At June 30, 1994 approximately $10.7 million of retained
earnings were restricted as to payment of dividends on
common stock.
4. COMMITMENTS AND CONTINGENCIES:
With respect to commitments at June 30, 1994, reference is
made to Note 10 of Notes to Consolidated Financial
Statements appearing in the Company's Annual Report on
Form 10-K for the year ended December 31, 1993. No
significant changes have occurred with respect to those
matters as reported therein.
Contingencies at June 30, 1994 are as follows:
A. Nuclear Insurance
The Price-Anderson Indemnification Act, which deals with
the Company's public liability for a nuclear incident,
currently establishes the liability limit for third-party
claims associated with any nuclear incident at $9.4
billion. Each reactor licensee is currently liable for up
to $79.3 million per reactor owned for each nuclear
incident occurring at any reactor in the United States,
provided that not more than $10 million of the liability
per reactor would be assessed per year. The Company's
maximum assessment, based on its two-thirds ownership of
Summer Station, would not exceed approximately $52.9
million per incident but not more than $6.7 million per
year.
The Company currently maintains policies (for itself and on
behalf of the PSA) with Nuclear Electric Insurance Limited
(NEIL) and American Nuclear Insurers (ANI) providing
combined property and decontamination insurance coverage of
$1.4 billion for any losses in excess of $500 million
pursuant to existing primary coverages (with ANI) on Summer
Station. The Company pays annual premiums and, in addition,
could be assessed a retroactive premium not to exceed 7 1/2
times its annual premium in the event of property damage
loss to any nuclear generating facilities covered by NEIL.
Based on the current annual premium, this retroactive
premium would not exceed approximately $8.1 million.
To the extent that insurable claims for property damage,
decontamination, repair and replacement and other costs and
expenses arising from a nuclear incident at Summer Station
exceed the policy limits of insurance, or to the extent
such insurance becomes unavailable in the future, and to
the extent that the Company's rates would not recover the
cost of any purchased replacement power, the Company will
retain the risk of loss as a self-insurer. The Company has
no reason to anticipate a serious nuclear incident at
Summer Station. If such an incident were to occur, it
could have a materially adverse impact on the Company's
financial position.
B. Environmental
The Company has an environmental assessment program to
identify and assess current and former operations sites
that could require environmental cleanup. As site
assessments are initiated, an estimate is made of the
amount of expenditures, if any, necessary to investigate
and clean up each site. These estimates are refined as
additional information becomes available; therefore actual
expenditures could significantly differ from the original
estimates. Amounts estimated and accrued to date for site
assessment and cleanup relate primarily to regulated
operations; such amounts have been deferred (approximately
$23.4 million) and are being amortized and recovered
through rates over a ten year period.
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Material Changes in Capital Resources and Liquidity
From December 31, 1993 to June 30, 1994
Liquidity and Capital Resources
The cash requirements of the Company arise primarily from its
operational needs and construction program. The ability of the
Company to replace existing plant investment, as well as to expand
to meet future demands for electricity and gas, will depend upon
its ability to attract the necessary financial capital on
reasonable terms. The Company recovers the costs of providing
services through rates charged to customers. Rates for regulated
services are based on historical costs. As customer growth and
inflation occur and the Company expands its construction program it
is necessary to seek increases in rates. As a result the Company's
future financial position and results of operations will be
impacted by its ability to obtain adequate and timely rate relief.
The following table summarizes how the Company generated funds
for its utility property additions and construction expenditures
during the six months ended June 30, 1994 and 1993:
Six Months Ended
June 30,
1994 1993
(Thousands of Dollars)
Net cash provided from operating activities $101,658 $ 45,974
Net cash provided from financing activities 80,734 69,455
Cash and temporary cash investments available
at the beginning of the period 193 24,302
Net cash available for utility property
additions and construction expenditures $182,585 $139,731
Funds used for utility property additions
and construction expenditures, net of
noncash allowance for funds used during
construction $180,296 $118,387
In June 1994 the Company placed into effect the second phase
of the retail electric rate increase approved by the South Carolina
Public Service Commission on June 7, 1993.
On July 21, 1994, the Company issued $100 million of First
Mortgage Bonds, 7.70% series due July 15, 2004 to repay short-term
borrowings in a like amount. Accordingly, short-term borrowings in
the amount of $99 million are included in "Long-term debt, net."
The Company anticipates that the remainder of its 1994 cash
requirements will be met primarily through internally generated
funds, sales of additional securities, additional equity
contributions from SCANA and the incurrence of additional short-
term and long-term indebtedness. The timing and amount of such
financings will depend upon market conditions and other factors.
The ratio of earnings to fixed charges for the twelve months
ended June 30, 1994 was 3.82.
The Company expects that it has or can obtain adequate sources
of financing to meet its cash requirements for the next twelve
months and for the foreseeable future.
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
Results of Operations
For the Six Months Ended June 30, 1994
As Compared to the Corresponding Period in 1993
Earnings and Dividends
Net income for the three and six months ended June 30, 1994
increased approximately $3.0 million and $11.5 million,
respectively, when compared to the corresponding periods in 1993
primarily due to an increase in the electric operating margin.
AFC is a utility accounting practice whereby a portion of the
cost of both equity and borrowed funds used to finance construction
(which is shown on the balance sheet as construction work in
progress) is capitalized. Both the equity and the debt portions of
AFC are noncash items of nonoperating income which have the effect
of increasing reported net income. AFC represented approximately
9% and 12% of income before income taxes for the three months
ended June 30, 1994 and 1993, respectively, and approximately 7%
and 9% for the six months ended June 30, 1994 and 1993,
respectively.
On April 28, 1994 the Company's Board of Directors authorized
the payment of a dividend on common stock of $29,600,000 for the
quarter ended June 30, 1994. The dividend was paid on July 1, 1994
to SCANA Corporation, the Company's parent.
Sales Margins
The changes in the electric sales margins for the three and
six months ended June 30, 1994 when compared to the corresponding
periods in 1993 were as follows:
Three Months Six Months
Change % Change Change %Change
(Millions) (Millions)
Electric operating revenues $11.1 5.2 $38.4 9.1
Less: Fuel used in electric
generation 5.8 14.2 11.0 14.3
Purchased power (5.0) (18.5) (2.1) (4.1)
Margin $10.3 7.0 $29.5 10.1
The electric sales margins increased for the three and six
months ended June 30, 1994 compared to the corresponding periods
in 1993 primarily due to an increase in retail electric rates
which was effective beginning in June 1993 and increases in
customer sales due to customer growth, reflecting a general
improvement in the economy. The second phase of the retail
electric rate increase, which was placed into effect in June 1994,
also contributed to the increase in electric sales margins.
10
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The changes in the gas sales margins for the three and six
months ended June 30, 1994 when compared to the corresponding
periods in 1993 were as follows:
Three Months Six Months
Change % Change Change % Change
(Millions) (Millions)
Gas operating revenues $7.5 25.5 $14.1 14.1
Less: Gas purchased for resale 6.1 32.9 10.2 17.5
Margin $1.4 13.1 $ 3.9 9.3
The increase in the gas sales margin for the three and six
months is primarily due to recoveries under the weather
normalization adjustment (WNA) as a result of milder weather during
the second quarter of 1994 and to increased sales as a result of
the transfer of the operations of the former Peoples Natural Gas
Company of South Carolina from SCANA Corporation to the Company in
January 1994.
Other Operating Expenses
Increases (decreases) in other operating expenses, including
taxes, for the three and six months ended June 30, 1994
compared to the corresponding periods in 1993 are presented in the
following table:
Three Months Six Months
Change % Change Change % Change
(Millions) (Millions)
Other operation and maintenance $2.5 3.8 $ 6.6 5.1
Depreciation and amortization 1.5 6.0 2.9 5.7
Income taxes 3.2 30.9 11.6 41.2
Other taxes - - (0.1) (0.4)
Total $7.2 6.1 $21.0 8.7
Other operation and maintenance expenses for the three and six
months ended June 30, 1994 increased primarily due to increases in
employee-related expenses, amortization of environmental charges
previously deferred and outage-related expenses at the Company's
nuclear generating facility. The depreciation and amortization
increases for the three and six months reflect additions to plant
in service. The increases in income tax expense for the three and
six months' comparisons correspond to the increases in income and
reflect the 1993 increase in the corporate tax rate from 34% to 35%
which was recorded in August 1993 and was retroactive to January 1,
1993.
11
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
Part II
OTHER INFORMATION
Item 1. Legal Proceedings
For information regarding legal proceedings see Note 2
"Rate Matters" and Note 4 "Commitments and
Contingencies" of Notes to Consolidated Financial
Statements.
Items 2, 3, 4 and 5 are not applicable.
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibits filed with this Quarterly Report on Form
10-Q are listed in the following Exhibit Index.
Certain of such exhibits which have heretofore been
filed with the Securities and Exchange Commission
and which are designated by reference to their
exhibit numbers in prior filings are hereby
incorporated herein by reference and made a part
hereof.
B. Reports on Form 8-K
The Company filed a report on Form 8-K on July 15,
1994 in response to Item 5, "Other Events" regarding
the change in identity of an expert referred to in
the Prospectus included in Registration No. 33-
49421.
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SOUTH CAROLINA ELECTRIC & GAS COMPANY
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
SOUTH CAROLINA ELECTRIC & GAS COMPANY
(Registrant)
August 11, 1994 By: s/Jimmy E. Addison
Jimmy E. Addison
Vice President and Controller
(Principal Accounting Officer)
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SOUTH CAROLINA ELECTRIC & GAS COMPANY Sequentially
EXHIBIT INDEX Numbered
Number Pages
2. Plan of Acquisition, Reorganization, Arrangement,
Liquidation or Succession
Plan of Exchange of South Carolina Electric &
Gas Company and SCANA Corporation (Exhibit 2 to
Registration No. 33-49421).................................. #
3. Articles of Incorporation and By-Laws
A. Restated Articles of Incorporation of the
Company as adopted on June 9, 1994 (Filed herewith)....... 17
B. Articles of Amendment, dated June 7, 1994, filed
June 9, 1994 (Filed herewith)............................. 54
C. Copy of By-Laws of the Company as revised and
amended thru December 15, 1993 (Exhibit 3-AZ to
Form 10-K for the year ended December 31, 1993,
File No. 1-3375).......................................... #
4. Instruments Defining the Rights of Security
Holders, Including Indentures
A. Indenture dated as of January 1, 1945, from the
South Carolina Power Company (the "Power Company")
to Central Hanover Bank and Trust Company, as
Trustee, as supplemented by three Supplemental
Indentures dated respectively as of May 1, 1946,
May 1, 1947 and July 1, 1949 (Exhibit 2-B to
Registration No. 2-26459).................................. #
B. Fourth Supplemental Indenture dated as of April 1,
1950, to Indenture referred to in Exhibit 4A,
pursuant to which the Company assumed said
Indenture (Exhibit 2-C to Registration No. 2-26459)........ #
C. Fifth through Fifty-second Supplemental Indentures
to Indenture referred to in Exhibit 4A dated as
of the dates indicated below and filed as
exhibits to the Registration Statements and
1934 Act reports whose file numbers are set
forth below................................................ #
December 1, 1950 Exhibit 2-D to Registration No. 2-26459
July 1, 1951 Exhibit 2-E to Registration No. 2-26459
June 1, 1953 Exhibit 2-F to Registration No. 2-26459
June 1, 1955 Exhibit 2-G to Registration No. 2-26459
November 1, 1957 Exhibit 2-H to Registration No. 2-26459
September 1, 1958 Exhibit 2-I to Registration No. 2-26459
September 1, 1960 Exhibit 2-J to Registration No. 2-26459
June 1, 1961 Exhibit 2-K to Registration No. 2-26459
December 1, 1965 Exhibit 2-L to Registration No. 2-26459
June 1, 1966 Exhibit 2-M to Registration No. 2-26459
June 1, 1967 Exhibit 2-N to Registration No. 2-29693
September 1, 1968 Exhibit 4-O to Registration No. 2-31569
June 1, 1969 Exhibit 4-C to Registration No. 33-38580
December 1, 1969 Exhibit 4-Q to Registration No. 2-35388
June 1, 1970 Exhibit 4-R to Registration No. 2-37363
March 1, 1971 Exhibit 2-B-17 to Registration No. 2-40324
January 1, 1972 Exhibit 4-C to Registration No. 33-38580
July 1, 1974 Exhibit 2-A-19 to Registration No. 2-51291
May 1, 1975 Exhibit 4-C to Registration No. 33-38580
July 1, 1975 Exhibit 2-B-21 to Registration No. 2-53908
February 1, 1976 Exhibit 2-B-22 to Registration No. 2-55304
December 1, 1976 Exhibit 2-B-23 to Registration No. 2-57936
March 1, 1977 Exhibit 2-B-24 to Registration No. 2-58662
# Incorporated herein by reference as indicated.
14
<PAGE>
SOUTH CAROLINA ELECTRIC & GAS COMPANY Sequentially
EXHIBIT INDEX Numbered
Number Pages
4. (Continued)
May 1, 1977 Exhibit 4-C to Registration No. 33-38580
February 1, 1978 Exhibit 4-C to Registration No. 33-38580
June 1, 1978 Exhibit 2-A-3 to Registration No. 2-61653
April 1, 1979 Exhibit 4-C to Registration No. 33-38580
June 1, 1979 Exhibit 4-C to Registration No. 33-38580
April 1, 1980 Exhibit 4-C to Registration No. 33-38580
June 1, 1980 Exhibit 4-C to Registration No. 33-38580
December 1, 1980 Exhibit 4-C to Registration No. 33-38580
April 1, 1981 Exhibit 4-D to Registration No. 33-49421
June 1, 1981 Exhibit 4-D to Registration No. 2-73321
March 1, 1982 Exhibit 4-D to Registration No. 33-49421
April 15, 1982 Exhibit 4-D to Registration No. 33-49421
May 1, 1982 Exhibit 4-D to Registration No. 33-49421
December 1, 1984 Exhibit 4-D to Registration No. 33-49421
December 1, 1985 Exhibit 4-D to Registration No. 33-49421
June 1, 1986 Exhibit 4-D to Registration No. 33-49421
February 1, 1987 Exhibit 4-D to Registration No. 33-49421
September 1, 1987 Exhibit 4-D to Registration No. 33-49421
January 1, 1989 Exhibit 4-D to Registration No. 33-49421
January 1, 1991 Exhibit 4-D to Registration No. 33-49421
February 1, 1991 Exhibit 4-D to Registration No. 33-49421
July 15, 1991 Exhibit 4-D to Registration No. 33-49421
August 15, 1991 Exhibit 4-D to Registration No. 33-49421
April 1, 1993 Exhibit 4-E to Registration No. 33-49421
July 1, 1993 Exhibit 4-F to Form 10-Q for the quarter
ended June 30, 1993, File No. 1-3375
D. Indenture dated as of April 1, 1993 from South Carolina
Electric & Gas Company to NationsBank of Georgia, National
Association (Filed as Exhibit 4-F to Registration
Statement No. 33-49421)...................................... #
E. First Supplemental Indenture to Indenture referred to
in 4-E dated as of June 1, 1993 (Filed as Exhibit 4-G
to Registration Statement No. 33-49421)...................... #
F. Second Supplemental Indenture to Indenture referred to
in 4-E dated as of June 15, 1993 (Filed as Exhibit 4-G
to Form 10-Q for the quarter ended June 30, 1993, File
No. 1-3375).................................................. #
10. Material Contracts
Not Applicable
11. Statement Re Computation of Per Share Earnings
Not Applicable
12. Statement re Computation of Ratios (Filed herewith)............ 56
15. Letter Re Unaudited Interim Financial Information
Not Applicable
18. Letter Re Change in Accounting Principles
Not Applicable
19. Report Furnished to Security Holders
Not Applicable
22. Published Report Regarding Matters Submitted to
Vote of Security Holders
Not Applicable
# Incorporated herein by reference as indicated.
15
<PAGE>
SOUTH CAROLINA ELECTRIC & GAS COMPANY
Exhibit Index (Continued)
Number
23. Consents of Experts and Counsel
Not Applicable
24. Power of Attorney
Not Applicable
27. Financial Data Schedule
Not Applicable
99. Additional Exhibits
Not Applicable
16
<PAGE>
SOUTH CAROLINA ELECTRIC & GAS COMPANY
RESTATED ARTICLES OF INCORPORATION
TABLE OF CONTENTS
(This Table of Contents is not part of the Restated Articles
of Incorporation and has been inserted herein for convenience
only. Nothing contained in this Table of Contents shall be
deemed to affect the meaning or construction of any of the
provisions contained in the Restated Articles of
Incorporation.)
Page
RECITAL................................................... 1
ARTICLE I
Name of Company...................................... 2
ARTICLE II
Perpetual existence, rights, powers and
liabilities under laws of South Carolina........... 3
ARTICLE III
Principal place of business.......................... 3
ARTICLE IV
General powers clauses............................... 3
ARTICLE V
Number of shares authorized.......................... 5
Classes of series of shares
A. Seniority of Preferred Stock..................... 6
B. Preferred Stock
1. Issuable in Series........................... 6
2. Terms of Preferred Stock which may vary
among series............................... 6
3. Relative rights and preferences.............. 6
C. Dividends on Preferred Stock
1. Dividend rates .............................. 7
2. Ratable dividend payments ................... 9
3. Restrictions on payment of dividends
on Common Stock............................ 9
4. Definitions:
"dividends".................................. 10
"Common Stock Equity"........................ 10
"Total Capitalization"....................... 11
"Net Income of Company available for
dividends on Common Stock"................. 11
5. Consolidated subsidiaries.................... 11
6. Reserves..................................... 11
17<PAGE>
<PAGE>
D. Amounts payable upon liquidation, whether
voluntary or involuntary....................... 12
1. Purchase Fund for 4.60% Cumulative
Preferred Stock............................ 13
2. Purchase Fund for 4.50% Cumulative
Preferred Stock............................ 14
3. Purchase Fund for 4.60% (Series A)
Cumulative Preferred Stock................. 16
4. Purchase Fund for 5.125% Cumulative
Preferred Stock............................ 18
5. Purchase Fund for 4.60% (Series B)
Cumulative Preferred Stock................. 19
6. Purchase Fund for 6% Cumulative Preferred
Stock...................................... 21
7. Sinking Fund for 9.40% Cumulative Preferred
Stock...................................... 23
8. Sinking Fund for 8.12% Cumulative Preferred
Stock...................................... 23
9. Sinking Fund for 7.70% Cumulative Preferred
Stock...................................... 24
10. Sinking Fund for 8.72% Cumulative Preferred
Stock...................................... 24
E. Redemption provisions relating to Preferred
Stock.......................................... 25
F. Voting Powers.................................... 27
G. Required consent or vote of Preferred Stock to:
1. (a) Create or issue shares of stock
ranking equally or prior to the
Preferred Stock or increase authorized
Preferred Stock......................... 28
(b) Amend charter affecting preferences,
voting powers, restrictions and
qualifications.......................... 28
2. Consolidations, mergers or sales of assets... 30
3. Issuance of unsecured indebtedness;
exceptions and limitations.................. 30
H. Holders of Preferred Stock not entitled to
preemptive right to purchase any capital stock
or securities convertible into capital stock..... 31
I. Holders of Common Stock not entitled to
preemptive right to purchase Shares of
Common Stock, options or rights of securities
convertible into Common Stock.................... 31
ARTICLE VI
Number of directors required......................... 31
EXHIBIT A................................................. 33
18<PAGE>
<PAGE>
STATE OF SOUTH CAROLINA
SECRETARY OF STATE
RESTATED ARTICLES OF INCORPORATION
Pursuant to Authority of Section 33-10-107 of the South
Carolina Business Corporation Act of 1988, the undersigned
Corporation adopts the following Restated Articles of Incorporation:
1. The name of the Corporation is SOUTH CAROLINA ELECTRIC &
GAS COMPANY.
2. The Registered Office of the Corporation is Palmetto
Center, 1426 Main Street in the City of Columbia, County of
Richland and the State of South Carolina and the name of
the Registered Agent at such address is A. H. Gibbes.
3. At a meeting thereof duly called and held on November 24,
1965, the Board of Directors of SOUTH CAROLINA ELECTRIC &
GAS COMPANY (hereinafter sometimes referred to as the
"Corporation" or the "Company") authorized the adoption of
a restatement of the Articles of Incorporation of the
Corporation so as to integrate into a single document the
text of the Agreement of Consolidation, dated June 29,
1943, between the Corporation (sometimes hereinafter
referred to as "South Carolina Company") and Lexington
Water Power Company (sometimes hereinafter referred to as
"Lexington"), together with all amendments thereto
theretofore adopted, all as provided in Section 9.8 of the
South Carolina Business Corporation Act of 1962 (12-19.8
Supplement Code 1962) and such Restated Articles of
Incorporation, dated November 24, 1965, were filed with the
Secretary of State of South Carolina on November 24, 1965,
and thereupon became the Articles of Incorporation of the
Corporation.
4. At a meeting thereof duly called and held on May 27, 1966,
the Board of Directors of the Corporation authorized the
adoption of a restatement of the Articles of Incorporation
of the Corporation so as to integrate into a single
document the text of the Restated Articles of
Incorporation, dated November 24, 1965, together with all
amendments thereto theretofore adopted, all as provided in
Section 9.8 of the South Carolina Business Corporation Act
of 1962 (12-19.8 Supplement to the South Carolina Code of
1962).
5. At a meeting thereof duly called and held on May 21, 1971,
the Board of Directors of the Corporation authorized the
adoption of a restatement of the Articles of Incorporation
of the Corporation so as to integrate into a single
document the text of the Restated Articles of
Incorporation, dated May 27, 1966, together with all
amendments thereto theretofore adopted, all as provided in
Section 9.8 of the South Carolina Business Corporation Act
of 1962 (12-19.8 Supplement to the South Carolina Code of
1962).
6. At a meeting thereof duly called and held on August 28,
1974, the Board of Directors of the Corporation authorized
the adoption of a restatement of the Articles of
incorporation of the Corporation so as to integrate into a
single document the text of the Restated Articles of
Incorporation, dated May 21, 1971, together with all
amendments thereto theretofore adopted, all as provided in
Section 9.8 of the South Carolina Business Corporation Act
of 1962 (12-19.8 Supplement to the South Carolina Code of
1962).
19
<PAGE>
7. At a meeting thereof duly called and held on July 28, 1976,
the Board of Directors of the Corporation authorized the
adoption of a restatement of the Articles of Incorporation
of the Corporation so as to integrate into a single
document the text of the Restated Articles of
Incorporation, dated August 28, 1974, together with all
amendments thereto theretofore adopted, all as provided in
Section 9.8 of the South Carolina Business Corporation Act
of 1962 (12-19.8 Supplement to the South Carolina Code of
1962).
8. At a meeting thereof duly called and held on November 26,
1980, the Board of Directors of the Corporation authorized
the adoption of a restatement of the Articles of
Incorporation of the Corporation so as to integrate into a
single document the text of the Restated Articles of
Incorporation, dated July 28, 1976, together with all
amendments thereto theretofore adopted, all as provided in
Section 9.8 of the South Carolina Business Corporation Act
of 1962 (Section 33-15-80 of the South Carolina Code of
1976).
9. At a meeting thereof duly called and held on June 26, 1985,
the Board of Directors of the Corporation authorized the
adoption of a restatement of the Articles of Incorporation
of the Corporation so as to integrate into a single
document the text of the Restated Articles of
Incorporation, dated November 26, 1980, together with all
amendments thereto theretofore adopted, all as provided in
Section 33-15-80, as amended, of the South Carolina
Business Corporation Act of 1962.
10. At a meeting thereof duly called and held on June 28,
1989, the Board of Directors of the Corporation authorized
the adoption of a restatement of the Articles of
Incorporation of the Corporation so as to integrate into a
single document the text of the Restated Articles of
Incorporation, dated June 26, 1985, together with all
amendments thereto theretofore adopted, all as provided in
Section 33-10-107 of the South Carolina Business
Corporation Act of 1988.
11. At a meeting thereof duly called and held on December 15,
1993, the Board of Directors of the Corporation authorized
the adoption of the following restatement of the Articles
of Incorporation of the Corporation so as to integrate
into a single document the text of the Restated Articles
of Incorporation, dated June 28, 1989, together with all
amendments thereto theretofore adopted, all as provided in
Section 33-10-107 of the South Carolina Business
Corporation Act of 1988.
12. This Restated Articles of Incorporation of the Corporation
purports merely to restate but not to change materially
the provisions of the aforesaid Restated Articles of
Incorporation, dated June 28, 1989, as heretofore amended
and supplemented, and there is no material discrepancy
between such provisions and the provisions of this
Restated Articles of Incorporation.
13. The undersigned Corporation adopts the following Restated
Articles of Incorporation, as heretofore amended and
supplemented.
ARTICLE I
The name of the Company is SOUTH CAROLINA ELECTRIC & GAS
COMPANY.
20
<PAGE>
ARTICLE II
The Company shall have perpetual existence and shall have and
enjoy all rights and powers accorded by the laws of South Carolina
and be subject to all labilities imposed by such laws.
ARTICLE III
The principal place of business of the Company shall be
Columbia, South Carolina.
ARTICLE IV
Without limiting the nature of the business which the Company
may do as provided in the charters, as amended, of South Carolina
Company and Lexington, the general nature of the business which the
Company proposes to do is the manufacture, generation, transmission,
distribution, purchase and sale, both at wholesale and at retail, of
electricity and gas, the sale of electric and gas appliances, and
the furnishing of bus transportation service in the City of Columbia
and its environs.
The general nature of the business provided in the charter, as
amended, of South Carolina Company is:
A. To construct, acquire by purchase, lease, consolidation,
merger or otherwise; to use, operate, maintain, sell,
convey, lease or otherwise dispose of, any works,
constructions, plants, systems or parts thereof, and any
and all rights or other property necessary or appropriate
to the production, use, distribution, sale, regulation,
control or application of electricity for any purpose
whatsoever; to generate electricity by water, steam or
other power; to produce, buy, acquire, deal in, use, lease,
sell, furnish, transmit and supply electricity in any form
and for any purpose whatsoever.
B. To purchase, install, deal in, use, sell, lease or
otherwise dispose of, machinery, generators, motors, lamps,
poles, wires, apparatus, equipment, devices, supplies and
articles of every kind pertaining to, or in any wise
connected with, the production, use, distribution,
regulation, control or application of electricity or
electrical apparatus for light, heat, power, railway,
manufacturing, and any and all other purposes.
C. To build, construct, acquire by purchase, lease,
consolidation, merger or otherwise, and operate street
railways, motor bus lines and transportation lines for
freight and passengers, whether operated by steam,
electricity or any other motive power whatsoever, (except
those transportation lines classed as railroads) and to
sell, convey, lease or otherwise dispose of the same.
D. To build, construct, acquire, by purchase, lease,
consolidation, merger or otherwise, and to maintain and
operate parks, places of amusement and other usual or
useful adjuncts to such properties or business, and to
sell, convey, lease or otherwise dispose of the same.
E. To manufacture, purchase, produce, sell, furnish and
distribute for light, heat, power and any other purposes
whatsoever, natural or artificial gas and to construct,
equip, acquire by purchase, lease, consolidation, merger or
otherwise and to own, maintain, operate, sell, convey,
lease or otherwise dispose of, all necessary and convenient
works, conduits, plants, apparatus and connections for
holding, receiving, purifying, manufacturing, selling,
utilizing and distributing natural and artificial gas; and
to manufacture, purchase, sell or otherwise dispose of
chemicals or other products derived wholly or in part from
gas or gas works, or in the manufacture of gas, and to
purchase, install, manufacture, deal in, use, sell or
otherwise handle or dispose of gas fixtures and appliances
in any way used or useful in connection with the
utilization or distribution of natural or artificial gas.
21
<PAGE>
F. To build, construct, acquire by purchase, lease,
consolidation, merger or otherwise; to own, equip, maintain
and operate telephone and telegraph lines of all kinds and
descriptions, and to sell, convey, lease, or otherwise
dispose of all necessary and convenient works, plants,
apparatus and connections necessary or desirable in
connection therewith; and to purchase, manufacture,
install, use, sell or otherwise deal in any and all
fixtures, appliances or apparatus, useful, necessary or
desirable in connection with the installation or operation
of telephone or telegraph lines or systems.
G. To build, construct, acquire, by purchase, lease,
consolidation, merger or otherwise; to own, equip,
maintain, operate, sell, convey, lease or otherwise dispose
of ice and refrigerating plants and to manufacture,
purchase, sell and deal in ice; handling, selling or
dealing in the same at retail and/or wholesale.
H. To build, construct, acquire by purchase, lease,
consolidation, merger or otherwise; to own, equip, hold,
operate, maintain, sell, convey, lease or otherwise dispose
of water powers, power plants, hydro-electric plants,
reservoirs, dams, canals, ditches, flumes, pipe lines and
such other works, plants, equipment, appliances and
appurtenances as may be necessary, useful or appropriate
for impounding, storing, conveying, distributing and
utilizing water for power, irrigation, sanitary, domestic,
manufacturing and otherwise and to use, supply and
otherwise dispose of water for all such uses; and to build,
construct, acquire by purchase, lease, consolidation,
merger or otherwise; to own, hold, operate, maintain, sell,
convey, lease or otherwise dispose of hydraulic and other
works, transmission lines, lines for the conveying of
electric current for power, lighting, heating or other
purposes and transforming and distributing stations and
circuits.
I. To acquire by purchase, lease, consolidation, merger or
otherwise; to hold, use, own, sell, convey, lease or
otherwise dispose of rights of way, easements, privileges,
grants, consents and franchises, including franchises or
special grants or privileges or consents from the State of
South Carolina or other States, or from counties, cities
and towns situate in South Carolina or other States, for
any of the foregoing businesses or purposes.
J. To acquire by purchase, lease, consolidation, merger or
otherwise; to hold, improve, develop, use, let, sell,
convey or otherwise dispose of, real estate and rights and
interests in or in respect to real estate or other
property; and to exercise the rights of eminent domain in
connection with any or all of the objects and purposes for
which the company is formed in all respects as such right
is now or shall hereafter be authorized by law.
K. To purchase, hold, assign, transfer, mortgage, pledge or
otherwise dispose of the shares of the capital stock or any
bonds, securities, obligations or evidences of indebtedness
of any other corporation or corporations of this or any
other State, and, while owner of such stock, to exercise
all the rights, powers and privileges of ownership,
including the right to vote thereon, and to issue in
exchange for any such shares of capital stock, bonds,
securities, obligations or evidences of indebtedness, its
stocks, bonds, or other obligations.
L. To guarantee the payment of any bonds, debentures or other
securities or obligations issued by any company in which
this company is interested, and the payment of dividends
and interest on any stocks, bonds, debentures or other
securities issued by any such corporation.
22
<PAGE>
M. The corporation shall have all the powers now or hereafter
conferred by the laws of South Carolina on corporations
formed for similar objects or purposes, and may carry on
any business or operation deemed advantageous, incidental
or necessary to any of the purposes or objects hereinbefore
enumerated, and, in general, may do whatever a natural
person might do in the premises, and may conduct its
business in all its branches, not only in the State of
South Carolina but in any State, territory, possession or
dependency of the United States.
N. It is expressly provided that the foregoing shall be
construed both as objects and powers, and that the
enumeration of specific objects, purposes and powers shall
in no wise be held or construed to limit or restrict in any
manner the general or incidental powers of the corporation.
The general nature of the business provided in the charter, as
amended, of Lexington is to erect and maintain power houses for the
generation of electric power by steam or water power and to transmit
by wire and sell such electric power, to conduct, transact and carry
on in all its branches the manufacture, dyeing, finishing and sale
of goods of every kind and description made of cotton, wool or other
fibrous material, either or both, of all descriptions whatsoever,
and any and all kinds of goods, wares and merchandise made of
leather, iron, wood or other material, and to buy and sell all
material for manufacture and all products of manufacture, and other
goods and merchandise; and to erect, maintain, own, lease and
operate, or cause to be operated planing mills, grist mills, saw
mills, and all other kinds of mill buildings, machine and work
shops, stores, dwellings and other business premises, and to do all
such things as are necessary and usually incident to the proper
conduct of all or any portion of its business as above enumerated;
to construct a dam or dams, on its own lands, across the Saluda
River, in Lexington County, at Dreher's or Rauch's Shoals, or both,
or at other points on their own land, across said river, at which
the said river is not now navigable, for the purpose of utilizing
the water power at these shoals to generate electricity and for
other purposes; and, having first obtained the approval of the
County Commissioners of Lexington or other Counties, Lexington shall
have the right to erect poles along the public highways of the
County or Counties so approving, and hang wires thereon, for the
purpose of transmitting electric current from its power plant on the
Saluda River to towns and other municipalities and to manufacturing
and industrial enterprises.
ARTICLE V
The total number of shares which the Company shall be
authorized to issue, and the number of such shares which shall be
Preferred Stock of the par value of $25 per share, issuable in
series, Preferred Stock of the par value of $50 per share, issuable
in series, Preferred Stock of the par value of $100 per share,
issuable in series, and Common Stock of the par value of $4.50 per
share is specified in Exhibit A hereto.
The relevant information regarding the shares, including
classes and series of shares, which the Company shall be authorized
to issue, and the designations, relative rights, preferences, and
limitations of the shares of each class, and as among the presently
established series of Preferred Stock designated as set forth in
Exhibit A hereto, and any additional series hereafter established by
the Board of Directors of the Company (the "Board of Directors")
pursuant to Section B.2 of this Article V, are as follows:
A. The Preferred Stock is senior to the Common Stock and the
Common Stock is subject to all rights and preferences of
the Preferred Stock as herein set forth.
B.1. The Preferred Stock shall be issuable in series and shall
consist of the authorized but unissued shares
undesignated as to series and the authorized and
outstanding shares designated as to series specified in
Exhibit A hereto.
23
<PAGE>
2. The authorized but unissued shares of the Preferred Stock
undesignated as to series may be issued in one or more
series which shall be established by the Board of
Directors. The authorized number of shares of any such
series, the designation of such series, and the relative
rights, preferences and limitations as among such series
and the series which are designated as set forth in
Exhibit A (in those respects in which the shares of one
series may vary from the shares of other series as herein
provided) shall be fixed and determined at any time prior
to the issuance thereof by resolution or resolutions of
the Board of Directors. All shares of the same series
shall be identical.
3. The Preferred Stock of all series shall be identical
except as to the par value (which shall be $25 per share,
$50 per share, or $100 per share as specified in
Exhibit A hereto) and as to the following relative rights
and preferences:
(a) The rate of dividends on shares of such series;
(b) Whether shares of such series may be redeemed and, if
so, the redemption price and the terms and conditions
of redemption;
(c) The amount payable upon shares of such series in the
event of voluntary and involuntary liquidation;
(d) Sinking fund provisions, if any, for the redemption
or purchase of shares of such series for any sinking
fund or purchase fund;
(e) The terms and conditions, if any, on which shares of
such series may be converted into shares of any other
class or series; and
(f) The voting rights of the shares of such series.
Except as otherwise provided by law, by paragraph 2
of Section G of this Article V, or by the resolutions
establishing any series of Preferred Stock in
accordance with the provisions of Section B.2 above,
whenever the consent or vote or other action on the
part of the holders of the Preferred Stock may be
required for any purpose, such consent, vote or other
action shall be taken by the holders of the Preferred
Stock as a single body (unless these Articles or the
law of the State of South Carolina specifically
provides otherwise), and shall be determined by
weighing the vote cast for each share as follows:
(i) Each share of the Preferred Stock of the par
value of $25 per share shall be entitled to one-
quarter of one vote per share;
(ii) Each share of the Preferred Stock of the par
value of $50 per share identified in Exhibit A
hereto as being entitled to one vote per share
shall have one vote per share;
(iii) Each share of the Preferred Stock of the par
value of $50 per share identified in Exhibit A
hereto as being entitled to one-half of one vote
per share shall have one-half of one vote per
share; and
(iv) Each share of the Preferred Stock of the par
value of $100 per share shall be entitled to one
vote per share.
24
<PAGE>
C.1. Before any dividend shall be declared or paid upon or set
apart for, or any other distribution shall be made or
ordered in respect of, the Common Stock and before any
sum shall be paid or set apart for or applied to the
purchase, redemption or other retirement of stock of the
Company of any class, the holders of the Preferred Stock,
without preference or priority as between series, shall
be entitled to receive out of the assets of the Company
available for dividends, but only when and as declared by
the Board of Directors, dividends as follows:
(a) in the case of the 5% Preferred Stock, at the rate
of but not exceeding Two Dollars and Fifty Cents
($2.50) per share per annum from July 1, 1943 in
respect of shares issued prior to October 1, 1943
and, in respect of shares issued on and after
October 1, 1943, from the quarterly dividend payment
date which coincides with or next precedes the date
of issue thereof, whichever is later, payable on
October 1, 1943 and quarterly thereafter as to
shares issued prior to such date and payable as to
all other shares thereof on the first day of either
January, April, July or October, whichever of said
days first occurs after the issue thereof, and
quarterly thereafter,
(b) in the case of the 4.60% Cumulative Preferred Stock,
at the rate of but not exceeding Two Dollars and
Thirty Cents ($2.30) per share per annum from the
date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(c) in the case of the 4.50% Cumulative Preferred Stock,
at the rate of but not exceeding Two Dollars and
Twenty-five Cents ($2.25) per share per annum from
the date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(d) in the case of the 4.60% (Series A) Cumulative
Preferred Stock, at the rate of but not exceeding
Two Dollars and Thirty Cents ($2.30) per share per
annum from the date of the original issue of the
first share thereof, payable on the first day of
either January, April, July or October, whichever of
said days first occurs after the issue thereof, and
quarterly thereafter,
(e) in the case of the 5.125% Cumulative Preferred
Stock, at the rate of but not exceeding Two Dollars
and Fifty-six and one-quarter Cents ($2.5625) per
share per annum from the date of the original issue
of the first share thereof, payable on the first day
of either January, April, July or October, whichever
of said days first occurs after the issue thereof,
and quarterly thereafter,
(f) in the case of the 4.60% (Series B) Cumulative
Preferred Stock, at the rate of but not exceeding
Two Dollars and Thirty Cents ($2.30) per share per
annum from the date of the original issue of the
first share thereof, payable on the first day of
either January, April, July or October, whichever of
said days first occurs after the issue thereof, and
quarterly thereafter,
(g) in the case of the 6% Cumulative Preferred Stock, at
the rate of but not exceeding Three Dollars ($3.00)
per share per annum from the date of the original
issue of the first share thereof, payable on the
first day of either January, April, July or October,
whichever of said days first occurs after the issue
thereof, and quarterly thereafter,
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<PAGE>
(h) in the case of the 9.40% Cumulative Preferred Stock,
at the rate of but not exceeding Four Dollars and
Seventy Cents ($4.70) per share per annum from the
date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(i) in the case of the 8.12% Cumulative Preferred Stock,
at the rate of but not exceeding Eight Dollars and
Twelve Cents ($8.12) per share per annum from the
date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(j) in the case of the 7.70% Cumulative Preferred Stock,
at the rate of but not exceeding Seven Dollars and
Seventy Cents ($7.70) per share per annum from the
date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(k) in the case of the 8.40% Cumulative Preferred Stock,
at the rate of but not exceeding Eight Dollars and
Forty Cents ($8.40) per share per annum from the
date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter,
(l) in the case of the 8.72% Cumulative Preferred Stock,
at the rate of but not exceeding Four Dollars and
Thirty-six Cents ($4.36) per share per annum from
the date of the original issue of the first share
thereof, payable on the first day of either January,
April, July or October, whichever of said days first
occurs after the issue thereof, and quarterly
thereafter, and
(m) in the case of any series of Preferred Stock
established by the Board of Directors pursuant to
Section B.2 of this Article V, at such rate as may
be fixed and determined by the resolution or
resolutions of the Board of Directors establishing
such series from the date of original issue of the
first share thereof, payable on the first day of
either January, April, July or October, whichever of
said days first occurs after the issue thereof, and
quarterly thereafter.
Such dividends upon the Preferred Stock shall be
cumulative from and after the respective dates specified
above, so that if dividends, at the rate per share per
annum specified for each of the series designated as set
forth in (a) through (m) above, and at such rate as may
be fixed and determined by the resolution or resolutions
adopted by the Board of Directors pursuant to Section B.2
(or its successor) of this Article V in the case of any
series of Preferred Stock established by the Board of
Directors pursuant to said Section B.2 (or its
successor), from the date upon which the dividends
thereon became cumulative to the end of the then
quarterly dividend period, shall not have been paid or
declared and a sum sufficient for the payment thereof set
apart, then the amount of the deficiency shall be fully
paid, but without interest, or dividends upon said shares
in such amount shall be declared and a sum sufficient for
the payment thereof set apart, before any dividends shall
be declared or paid upon or set apart for, or any other
distribution shall be made or ordered in respect of, the
Common Stock and before any sum shall be paid or set
apart for or applied to the purchase, redemption or
retirement of stock of the Company of any class. The
holders of the Preferred Stock shall not be entitled to
participate in or receive any other or further dividend.
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<PAGE>
2. In the event that the assets of the Company available for
dividends are insufficient to pay or to justify making
provision for the payment of the full quarterly dividend
on the Preferred Stock of all series then outstanding or
in the event of arrearages thereon, the Company shall, so
long as Preferred Stock of more than one series is
outstanding, make dividend payments ratably, to the
extent declared, upon all outstanding shares of Preferred
Stock of all series then outstanding in proportion to the
amount of the cumulative dividends (including arrears, if
any) to which each outstanding share of Preferred Stock
of each series is entitled upon the date of such dividend
payment.
3. After the requirements in respect of the dividends upon
the Preferred Stock, as herein before set forth, to the
end of the then current quarterly dividend period for
said stock shall have been met, and subject to any
Purchase Fund or Sinking Fund provisions heretofore or
hereafter fixed and determined for any series of
Preferred Stock pursuant to this Article V, the holders
of the Common Stock shall be entitled to receive out of
the remaining assets of the Company available for
dividends, such dividends as may from time to time be
declared by the Board of Directors, subject, however, so
long as any shares of Preferred Stock shall be
outstanding, to the following restrictions:
(a) no dividends shall be paid on the Common Stock if
after such dividend the aggregate amount of such
dividends paid since December 31, 1945, exceeds the
sum of the aggregate amount credited to earned
surplus subsequent to December 31, 1945, less the
aggregate amount charged to earned surplus
subsequent to December 31, 1945, otherwise than with
respect to any such dividends, provided, however,
that no charge shall be made to capital surplus
accumulated prior to January 1, 1946 or to earned
surplus accumulated prior to January 1, 1946 except
that the Company may make charges to earned surplus
accumulated prior to January 1, 1946 or to capital
surplus accumulated prior to January 1, 1946 (i) for
the write-down or write-off of any portion of the
Company's Electric Plant which may be classified as
Electric Plant Adjustment or any portion of the
Company's other utility plant which may be
classified as plant adjustment or plant acquisition
adjustment, which write-down or write-off the
Company is required to make pursuant to an order of
the South Carolina Public Service Commission or of
the Federal Power Commission entered in connection
with the determination of the "Original Cost", or
(ii) for the write-down or write-off of any portion
of the Company's Electric Plant which may be
classified as Electric Plant Acquisition Adjustment
or Electric Plant Adjustment, which write-down or
write-off the Company is required to make pursuant
to an order of the Federal Power Commission entered
in connection with the determination of the "Actual
Legitimate Original Cost" of the properties of the
Company, and
(b) if and so long as the Common Stock Equity, as
hereinafter defined, at the end of the calendar
month immediately preceding the date on which a
dividend on Common Stock is declared is, or as a
result of such dividend would become, less than
twenty per centum (20%) of Total Capitalization, as
defined, the Company shall not declare dividends on
the Common Stock in an amount which, together with
all other dividends on Common Stock declared within
the year ending with (and including) the date of
such dividend declaration, exceeds fifty per centum
(50%) of the Net Income of the Company Available for
Dividends on the Common Stock, as defined, for the
twelve full calendar months immediately preceding
the month in which such dividends are declared, and
27
<PAGE>
(c) if and so long as the Common Stock Equity at the end
of the calendar month immediately preceding the date
on which a dividend on Common Stock is declared is,
or as a result of such dividend would become, less
than twenty-five per centum (25%) but not less than
twenty per centum (20%) of Total Capitalization, the
Company shall not declare dividends on the Common
Stock in an amount which, together with all other
dividends on Common Stock declared subsequent to
December 31, 1945, exceeds seventy-five per centum
(75%) of Net Income of the Company Available for
Dividends on the Common Stock for the period from
December 31, 1945 to and including the end of the
calendar month immediately preceding the month in
which such dividends are declared, and
(d) at any time when the Common Stock Equity is twenty-
five per centum (25%) or more of Total
Capitalization, the Company may not pay dividends on
shares of the Common Stock which would reduce the
Common Stock Equity below twenty-five per centum
(25%) of Total Capitalization; provided, however,
that even though the payment of such dividends would
reduce the Common Stock Equity below twenty-five per
centum (25%) of Total Capitalization, such dividends
may be declared to the extent that the same,
together with all dividends on Common Stock declared
subsequent to December 31, 1945, do not exceed
seventy-five per centum (75%) of the Net Income of
the Company Available for Dividends on the Common
Stock for the period from December 31, 1945 to and
including the end of the calendar month immediately
preceding the month in which such dividends are
declared.
In computing the amount available for any dividend,
distribution, purchase or acquisition, charges and credits
to earned surplus shall be made in accordance with sound
accounting practice.
4. For the purpose of this Section C of Article V:
The word "dividends" when used with reference to
the Common Stock shall include dividends or other
distributions on or the purchase or other acquisition for
value of shares of Common Stock, but shall not include any
portion of dividends payable in shares of the Common Stock.
The term "Common Stock Equity" shall mean the sum
of the amount of the par or stated value of the issued and
outstanding shares of the Common Stock and the surplus
(including capital or paid-in surplus) and premium on Common
Stock of the Company less the amount known, or estimated if
not known, to represent the excess, if any, of recorded
value over original cost of used and useful utility plant
and other property, and less any items set forth on the
asset side of the balance sheet as a result of accounting
convention such as unamortized debt discount and expense,
capital stock discount and expense, and the excess, if any,
of the aggregate amount payable on involuntary dissolution,
liquidation or winding up of the Company upon all
outstanding shares of Preferred Stock of all series over the
aggregate par value of such shares, unless such amount or
items so to be deducted in the determination of the Common
Stock Equity are being amortized, depreciated, or otherwise
disposed of.
The term "Total Capitalization" shall mean the
aggregate of the par value of the issued and outstanding
shares of stock of all classes of the Company and the
surplus (including capital or paid-in surplus) and premium
on capital stock of the Company, plus the principal amount
of all outstanding debt maturing more than twelve months
from the date of the determination of Total Capitalization.
28
<PAGE>
The term "Net Income of the Company Available for
Dividends on the Common Stock" shall mean, for any twelve
months' period, or for the period from December 31, 1945 to
the date as of which such net income is being determined, as
the case may be, an amount equal to the sum of the operating
revenues and income from investments and other miscellaneous
income for such period, less all deductions (including
accruals) for operating expenses for such period, including
maintenance and provision for depreciation or amortization,
income and excess profits and other taxes, interest charges,
other amortization charges and other income deductions
(provided, however, that no deduction shall be made with
respect to the appropriation in the amount of $500,000 made
in May, 1948 to create a reserve to partly provide for the
excess of cost of investment in South Carolina Power Company
over its underlying book value at date of acquisition by the
Company), all as shall be determined in accordance with
sound accounting practice, and less also current and accrued
dividends on all outstanding shares of stock of the Company
ranking prior to the Common Stock as to dividends or assets.
For the purpose of determining Net Income of the
Company Available for Dividends on the Common Stock the
deduction on account of provision for depreciation on all
the property of the Company shall be in the amount therefor
shown on the books of the Company but, with respect to
property of the Company other than the Company's motor coach
transportation property, shall not be less than 15% of the
gross operating revenues of the Company derived from the
sale of electricity and manufactured or natural gas during
such period after deducting from such revenues an amount
equal to the aggregate cost of electricity or manufactured
or natural gas purchased during such period for the purpose
of resale in connection with the operation of the Company's
operating property, less an amount equal to the aggregate of
the charges to operating expense during such period for
current repairs and maintenance of such operating property.
5. If at the time when any calculation of Common
Stock Equity, Total Capitalization or Net Income of the
Company Available for Dividends on the Common Stock is
required to be made, the Company shall have one or more
subsidiaries whose accounts may properly be consolidated
with the accounts of the Company, such calculation shall be
made for the Company with such subsidiaries on a
consolidated basis in accordance with sound accounting
practice.
6. Anything herein contained to the contrary
notwithstanding, the rights of the holders of all classes of
stock of the Company in respect of dividends shall at all
times be subject to the power of the Board of Directors from
time to time to set aside such reserves and/or to make such
other provisions, if any, for working capital and for
additions and improvements to fixed properties and equipment
as said Board shall deem to be necessary or advisable.
D. In the event of any liquidation, dissolution or winding
up of the Company, whether voluntary or involuntary, or
any reduction of its capital stock resulting in any
distribution of its assets to its stockholders, the
holders of the Preferred Stock, without preference or
priority as between series, shall be entitled to
receive out of the assets of the Company, whether from
capital, from surplus or from earnings, available for
distribution to its stockholders, before any amount shall be
paid to the holders of the Common Stock, a sum per share
equal to the par value per share, plus, in the case of any
distribution resulting from a reduction of capital stock or
in the event that such dissolution, liquidation or winding
up shall have been voluntary, (a) in the case of the 5%
Preferred Stock a premium of Two Dollars and Fifty Cents
($2.50) per share, (b) in the case of the presently
designated series of Preferred Stock as set forth in
Exhibit A hereto a premium per share in an amount equal to
the difference between the par value per share and the then
redemption price per share as provided in Section E of this
Article V, and (c) in the case of any series of Preferred
Stock established by the Board of Directors pursuant to
Section B.2 (or its successor) of this Article V, a premium
in an amount equal to the difference between the par value
per share and the redemption price per share of shares of
such series fixed and determined by the resolution or
29
<PAGE>
resolutions of the Board of Directors establishing such
series, in effect at the time of such voluntary dissolution,
liquidation or winding up, and in addition thereto, in all
cases, an amount which, together with the aggregate of the
dividends previously paid upon such share, will be equal, in
the case of all presently designated series as set forth in
Exhibit A hereto, to the annual dividend rate for such
series (but without interest) as set forth in 1(a) through
1(m) of Section C.1 of this Article V, from the date upon
which the dividends thereon became cumulative to the date of
the distribution upon such liquidation or dissolution or
winding up or reduction, and the holders of the Preferred
Stock shall not be entitled to any other or further
distribution. If the assets of the Company available for
distribution to the holders of the Preferred Stock shall be
insufficient to permit the payment in full of the sums
payable as aforesaid to the holders of all the outstanding
shares of Preferred Stock of all series then outstanding
upon such liquidation or dissolution or winding up or
reduction, all such assets of the Company shall be
distributed ratably among the holders of all the outstanding
shares of Preferred Stock of all series then outstanding,
without preference or priority as between series, in
proportion to the full preferential amount (including
cumulative dividends and premiums, if any) which each such
share would be entitled to receive, if such assets were
sufficient to permit distribution in full as aforesaid. The
redemption by the Company of its Preferred Stock of any
series or the purchase of shares of its Preferred Stock of
any series or of its Common Stock in any manner permitted by
law shall not for the purpose of this Section D be regarded
as a liquidation, dissolution or winding up of the Company
or as a reduction of its capital; provided that, except as
provided in any Purchase Fund or Sinking Fund provisions
heretofore or hereafter fixed and determined for any series
of Preferred Stock pursuant to this Article V, the Company
shall not, so long as any shares of Preferred Stock remain
outstanding, purchase any of its Preferred Stock or Common
Stock otherwise than out of earned surplus or net profits of
the Company at the time available for payment of dividends
on its Common Stock or from the proceeds received within a
period of six (6) months prior to such purchase from the
sale of stock of any class subordinate to the Preferred
Stock both as to dividends and assets. Nothing in this
Section D contained, however, shall prevent the Company from
acquiring its Preferred Stock of any series for retirement
by the exchange therefor of any class of stock of the
Company which is now or hereafter may be lawfully
authorized. A consolidation or merger of the Company with,
or into, any other corporation or corporations, or a
consolidation or merger of any other corporation or
corporations into the Company, or a sale or transfer of
substantially all of its assets as an entirety, shall not be
regarded as a liquidation, dissolution or winding up of the
Company within the meaning of this Section D. A dividend or
distribution to stockholders from net profits or surplus
earned after the date of any such reduction of capital stock
as does not result in any distribution of assets to holders
of its Common Stock, or the purchase or redemption of
Preferred Stock of any series or of Common Stock by the
application of such net profits or surplus, shall not be
deemed to be a distribution resulting from such reduction.
After payment in full of the sums hereinabove stated to be
payable in respect of the Preferred Stock upon any such
liquidation, dissolution, winding up, reduction or other
distribution, then the remaining assets of the Company
available for distribution to the stockholders shall be
distributed ratably among the holders of the Common Stock.
30
<PAGE>
1. On October 1, 1951 and on October 1 in each year
thereafter so long as any of the 4.60% Cumulative
Preferred Stock shall remain outstanding, the Company
shall, subject to the provisions of Section C of this
Article, set aside as a Purchase Fund for the 4.60%
Cumulative Preferred Stock (herein called the "Purchase
Fund") an amount equal to 2-1/2% of the aggregate par
value of the largest number of shares of 4.60%
Cumulative Preferred Stock at any time theretofore
outstanding; provided, however, that amounts set aside
for Purchase Funds heretofore or hereafter established
for the several series of Preferred Stock shall be set
aside without preference or priority as between series
so that if at any time there shall be a deficiency
(including any amount then required to be set aside) in
the Purchase Funds for two or more series of Preferred
Stock, any satisfaction of such deficiencies shall be
made simultaneously for such two or more Purchase Funds
in proportion to the amounts of the respective
deficiencies therein. On or before each such October 1
the Company shall in writing, addressed to all holders
of record of the 4.60% Cumulative Preferred Stock,
invite tenders of 4.60% Cumulative Preferred Stock at
the par value thereof, plus an amount equal to accrued
dividends to the next succeeding October 31, in an
amount sufficient to exhaust the moneys so set aside in
the Purchase Fund. The invitations for tenders shall
specify how tenders shall be made and how notification
of acceptance thereof will be given. Tenders may be
made on or before October 25, in each year. If the par
value of the shares of 4.60% Cumulative Preferred Stock
tendered in response to any such invitation aggregates
more than the amount available in the Purchase Fund such
tenders shall be accepted pro rata in proportion to the
total number of shares of 4.60% Cumulative Preferred
Stock tendered respectively by the holders thereof who
shall have made such tenders, provided that in any
event, each holder of 4.60% Cumulative Preferred Stock
shall be entitled to tender and to have purchased by the
Company on each such invitation, at least the number of
shares of the 4.60% Cumulative Preferred Stock held by
such holder which bears the same ratio to the total
number of shares to be purchased pursuant to the
invitation as the number of shares held of record by
such holder at the close of business on the last
business day before the date of such invitation, bears
to the total number of shares of 4.60% Cumulative
Preferred Stock then outstanding. Tenders shall be
accepted of sufficient shares of 4.60% Cumulative
Preferred Stock to exhaust all of the moneys in the
Purchase Fund. Payment for 4.60% Cumulative Preferred
Stock for which tenders shall have been accepted shall
be made on the October 31 following the last day for the
making of tenders. To the extent that tenders in any
year are not made in an amount sufficient to exhaust all
of the moneys so held in the Purchase Fund, such excess
moneys in the Purchase Fund for that year shall be
released from the Purchase Fund and become free funds to
the Company. The obligation to set aside amounts in the
Purchase Fund shall be cumulative, so that if, on
October 1 of each year cash in the required amount shall
not have been set aside in full, the amount of the
deficiency shall be added to the Purchase Fund for the
next succeeding year until the total aggregate amount
which shall have been set aside in such Purchase Fund,
and used or released to the Company in accordance with
the provisions of this Section D.1, shall equal 2-1/2%
of the aggregate par value of the largest number of
shares of 4.60% Cumulative Preferred Stock at any time
theretofore outstanding, multiplied by the number of
twelve month periods which shall have elapsed since
October 1, 1950. No dividends shall be declared or paid
upon or set apart for any shares of Common Stock or any
sums applied to the purchase, redemption or other
retirement of Common Stock, so long as any such
deficiency shall exist in the Purchase Fund. Amounts to
satisfy any such deficiency in the Purchase Fund, in
whole or in part, may be set aside in the Purchase Fund
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<PAGE>
at any time, for application in the manner aforesaid on
the next succeeding October 1, provided however, that if
at any time between any October 31 and July I of the
following year the amount so set aside in the Purchase
Fund shall aggregate $30,000 or more, the Company shall
immediately invite tenders of 4.60% Cumulative Preferred
Stock in the manner aforesaid, in an amount sufficient
to exhaust the moneys in the Purchase Fund, at the par
value thereof plus an amount equal to accrued dividends
to a date which shall be thirty days from the date of
such invitation, the invitation to remain open for
twenty-five days; and on or before the thirtieth day
following the date of such invitation, the Company shall
accept tenders and make payment for 4.60% Cumulative
Preferred Stock tendered, at the pace aforesaid in the
same manner as above provided with respect to moneys set
aside in the Purchase Fund on October 1 in each year,
and to the extent that tenders are not made in an amount
sufficient to exhaust the moneys so held in the Purchase
Fund, such moneys shall likewise be released from the
Purchase Fund and become free funds to the Company.
Amounts equal to accrued dividends on 4.60% Cumulative
Preferred Stock purchased through the Purchase Fund
shall be paid by the Company by the use of moneys not in
the Purchase Fund, and shall not be charged to the
Purchase Fund. Shares of 4.60% Cumulative Preferred
Stock purchased through the Purchase Fund shall be
cancelled and shall not be reissued.
2. On June 1, 1957 and on June 1 in each year thereafter so
long as any of the 4.50% Cumulative Preferred Stock
shall remain outstanding, the Company shall, subject to
the provisions of Section C of this Article, set aside
as a Purchase Fund for the 4.50% Cumulative Preferred
Stock (herein called the "4.50% Preferred Stock Purchase
Fund") an amount equal to 2% of the aggregate par value
of the largest number of shares of 4.50% Cumulative
Preferred Stock at any time theretofore outstanding;
provided, however, that amounts set aside for Purchase
Funds heretofore or hereafter established for the
several series of Preferred Stock shall be set aside
without preference or priority as between series so that
if at any time there shall be a deficiency (including
any amount then required to be set aside) in the
Purchase Funds for two or more series of Preferred
Stock, any satisfaction of such deficiencies shall be
made simultaneously for such two or more Purchase Funds
in proportion to the amounts of the respective
deficiencies therein. On or before each such June 1 the
Company shall in writing, addressed to all holders of
record of the 4.50% Cumulative Preferred Stock, invite
tenders of 4.50% Cumulative Preferred Stock at the par
value thereof, plus an amount equal to accrued dividends
to the next succeeding June 30, in an amount sufficient
to exhaust the moneys so set aside in the 4.50%
Preferred Stock Purchase Fund. The invitations for
tenders shall specify how tenders shall be made and how
notification of acceptance thereof will be given.
Tenders may be made on or before June 25, in each year.
If the par value of the shares of 4.50% Cumulative
Preferred Stock tendered in response to any such
invitation aggregates more than the amount available in
the 4.50% Preferred Stock Purchase Fund such tenders
shall be accepted pro rata (as nearly as practicable
without the purchase or issuance of fractional shares or
scrip therefor) in proportion to the total number of
shares of 4.50% Cumulative Preferred Stock tendered
respectively by the holders thereof who shall have made
such tenders, provided that in any event, each holder of
4.50% Cumulative Preferred Stock shall be entitled to
tender and to have purchased by the Company on each such
invitation, at least the number of shares (as nearly as
practicable without the purchase or issuance of
fractional shares or scrip therefor) of the 4.50%
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<PAGE>
Cumulative Preferred Stock held by such holder which
bears the same ratio to the total number of shares to be
purchased pursuant to the invitation as the number of
shares held of record by such holder at the close of
business on the last business day before the date of
such invitation, bears to the total number of shares of
4.50% Cumulative Preferred Stock then outstanding.
Tenders shall be accepted of sufficient shares of 4.50%
Cumulative Preferred Stock to exhaust all of the moneys
in the 4.50% Preferred Stock Purchase Fund. Payment for
4.50% Cumulative Preferred Stock for which tenders shall
have been accepted shall be made on the June 30
following the last day for the making of tenders. To
the extent that tenders in any year are not made in an
amount sufficient to exhaust all of the moneys so held
in the 4.50% Preferred Stock Purchase Fund, such excess
moneys in the 4.50% Preferred Stock Purchase Fund for
that year shall be released from the 4.50% Preferred
Stock Purchase Fund and become free funds to the
Company. The obligation to set aside amounts in the
4.50% Preferred Stock Purchase Fund shall be cumulative,
so that if, on June 1 of each year cash in the required
amount shall not have been set aside in full, the amount
of the deficiency shall be added to the 4.50% Preferred
Stock Purchase Fund for the next succeeding year until
the total aggregate amount which shall have been set
aside in such 4.50% Preferred Stock Purchase Fund, and
used or released to the Company in accordance with the
provisions of this Section D.2, shall equal 2% of the
aggregate par value of the largest number of shares of
4.50% Cumulative Preferred Stock at any time theretofore
outstanding, multiplied by the number of twelve month
periods which shall have elapsed since June 1, 1956. No
dividends shall be declared or paid upon or set apart
for any shares of Common Stock or any sums applied to
the purchase, redemption or other retirement of Common
Stock, so long as any such deficiency shall exist in the
4.50% Preferred Stock Purchase Fund. Amounts to satisfy
any such deficiency in the 4.50% Preferred Stock
Purchase Fund, in whole or in part, may be set aside in
the 4.50% Preferred Stock Purchase Fund at any time, for
application in the manner aforesaid on the next
succeeding June 1, provided however, that if at any time
between any June 30 and March 1 of the following year
the amount so set aside in the 4.50% Preferred Stock
Purchase Fund shall aggregate $40,000 or more, the
Company shall immediately invite tenders of 4.50%
Cumulative Preferred Stock in the manner aforesaid, in
an amount sufficient to exhaust the moneys in the 4.50%
Preferred Stock Purchase Fund, at the par value thereof
plus an amount equal to accrued dividends to a date
which shall be thirty days from the date of such
invitation, the invitation to remain open for twenty-
five days; and on or before the thirtieth day following
the date of such invitation, the Company shall accept
tenders and make payment for 4.50% Cumulative Preferred
Stock tendered, at the price aforesaid in the same
manner as above provided with respect to moneys set
aside in the 4.50% Preferred Stock Purchase Fund on
June 1 in each year, and to the extent that tenders are
not made in an amount sufficient to exhaust the moneys
so held in the 4.50% Preferred Stock Purchase Fund such
moneys shall likewise be released from the 4.50%
Preferred Stock Purchase Fund and become free funds to
the Company. Amounts equal to accrued dividends on
4.50% Cumulative Preferred Stock purchased through the
4.50% Preferred Stock Purchase Fund shall be paid by the
Company by the use of moneys not in the 4.50% Preferred
Stock Purchase Fund, and shall not be charged to the
4.50% Preferred Stock Purchase Fund. Shares of 4.50%
Cumulative Preferred Stock purchased through the 4.50%
Preferred Stock Purchase Fund shall be cancelled and
shall not be reissued.
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<PAGE>
3. On June 1, 1958 and on June 1 in each year thereafter so
long as any of the 4.60% (Series A) Cumulative Preferred
Stock shall remain outstanding, the Company shall,
subject to the provisions of Section C of this Article,
set aside as a Purchase Fund for the 4.60% (Series A)
Cumulative Preferred Stock (herein called the "4.60%
(Series A) Preferred Stock Purchase Fund") an amount
equal to 2% of the aggregate par value of the largest
number of shares of 4.60% (Series A) Cumulative
Preferred Stock at any time theretofore outstanding;
provided, however, that amounts set aside for Purchase
Funds heretofore or hereafter established for the
several series of Preferred Stock shall be set aside
without preference or priority as between series so that
if at any time there shall be a deficiency (including
any amount then required to be set aside) in the
Purchase Funds for two or more series of Preferred
Stock, any satisfaction of such deficiencies shall be
made simultaneously for such two or more Purchase Funds
in proportion to the amounts of the respective
deficiencies therein. On or before each such June 1 the
Company shall in writing, addressed to all holders of
record of the 4.60% (Series A) Cumulative Preferred
Stock, invite tenders of 4.60% (Series A) Cumulative
Preferred Stock at the par value thereof, plus an amount
equal to accrued dividends to the next succeeding June
30, in an amount sufficient to exhaust the moneys so set
aside in the 4.60% (Series A) Preferred Stock Purchase
Fund. The invitations for tenders shall specify how
tenders shall be made and how notification of acceptance
thereof will be given. Tenders may be made on or before
June 25, in each year. If the par value of the shares of
4.60% (Series A) Cumulative Preferred Stock tendered in
response to any such invitation aggregates more than the
amount available in the 4.60% (Series A) Preferred Stock
Purchase Fund such tenders shall be accepted pro rata (as
nearly as practicable without the purchase or issuance of
fractional shares or scrip therefor) in proportion to the
total number of shares of 4.60% (Series A) Cumulative
Preferred Stock tendered respectively by the holders
thereof who shall have made such tenders, provided that
in any event, each holder of 4.60% (Series A) Cumulative
Preferred Stock shall be entitled to tender and to have
purchased by the Company on each such invitation, at
least the number of shares (as nearly as practicable
without the purchase or issuance of fractional shares or
scrip therefor) of the 4.60% (Series A) Cumulative
Preferred Stock held by such holder which bears the same
ratio to the total number of shares to be purchased
pursuant to the invitation as the number of shares held
of record by such holder at the close of business on the
last business day before the date of such invitation,
bears to the total number of shares of 4.60% (Series A)
Cumulative Preferred Stock then outstanding. Tenders
shall be accepted of sufficient shares of 4.60% (Series
A) Cumulative Preferred Stock to exhaust all of the
moneys in the 4.60% (Series A) Preferred Stock Purchase
Fund. Payment for 4.60% (Series A) Cumulative Preferred
Stock for which tenders shall have been accepted shall be
made on the June 30 following the last day for the making
of tenders. To the extent that tenders in any year are
not made in an amount sufficient to exhaust all of the
moneys so held in the 4.60% (Series A) Preferred Stock
Purchase Fund, such excess moneys in the 4.60% (Series A)
Preferred Stock Purchase Fund for that year shall be
released from the 4.60% (Series A) Preferred Stock
Purchase Fund and become free funds to the Company. The
obligation to set aside amounts in the 4.60% (Series A)
Preferred Stock Purchase Fund shall be cumulative, so
that if, on June I of each year cash in the required
amount shall not have been set aside in full, the amount
of the deficiency shall be added to the 4.60% (Series A)
Preferred Stock Purchase Fund for the next succeeding
year until the total aggregate amount which shall have
been set aside in such 4.60% (Series A) Preferred Stock
Purchase Fund, and used or released to the Company in
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<PAGE>
accordance with the provisions of this Section D.3, shall
equal 2% of the aggregate par value of the largest number
of shares of 4.60% (Series A) Cumulative Preferred Stock
at any time theretofore outstanding, multiplied by the
number of twelve month periods which shall have elapsed
since June 1, 1957. No dividends shall be declared or
paid upon or set apart for any shares of Common Stock or
any sums applied to the purchase, redemption or other
retirement of Common Stock, so long as any such
deficiency shall exist in the 4.60% (Series A) Preferred
Stock Purchase Fund. Amounts to satisfy any such
deficiency in the 4.60% (Series A) Preferred Stock
Purchase Fund, in whole or in part, may be set aside in
the 4.60% (Series A) Preferred Stock Purchase Fund at any
time, for application in the manner aforesaid on the next
succeeding June 1, provided however, that if at any time
between any June 30 and March I of the following year the
amount so set aside in the 4.60% (Series A) Preferred
Stock Purchase Fund shall aggregate $50,000 or more, the
Company shall immediately invite tenders of 4.60% (Series
A) Cumulative Preferred Stock in the manner aforesaid, in
an amount sufficient to exhaust the moneys in the 4.60%
(Series A) Preferred Stock Purchase Fund, at the par
value thereof plus an amount equal to accrued dividends
to a date which shall be thirty days from the date of
such invitation, the invitation to remain open for
twenty-five days; and on or before the thirtieth day
following the date of such invitation, the Company shall
accept tenders and make payment for 4.60% (Series A)
Cumulative Preferred Stock tendered, at the price
aforesaid in the same manner as above provided with
respect to moneys set aside in the 4.60% (Series A)
Preferred Stock Purchase Fund on June 1 in each year, and
to the extent that tenders are not made in an amount
sufficient to exhaust the moneys so held in the 4.60%
(Series A) Preferred Stock Purchase Fund, such moneys
shall likewise be released from the 4.60% (Series A)
Preferred Stock Purchase Fund and become free funds to
the Company. Amounts equal to accrued dividends on 4.60%
(Series A) Cumulative Preferred Stock purchased through
the 4.60% (Series A) Preferred Stock Purchase Fund shall
be paid by the Company by the use of moneys not in the
4.60% (Series A) Preferred Stock Purchase Fund, and shall
not be charged to the 4.60% (Series A) Preferred Stock
Purchase Fund. Shares of 4.60% (Series A) Cumulative
Preferred Stock purchased through the 4.60% (Series A)
Preferred Stock Purchase Fund shall be cancelled and
shall not be reissued.
4. On April 1, 1963 and on April 1 in each year thereafter
so long as any of the 5.125% Cumulative Preferred Stock
shall remain outstanding, the Company shall, subject to
the provisions of Section C of this Article, set aside as
a Purchase Fund for the 5.125% Cumulative Preferred Stock
(herein called the "5.125% Preferred Stock Purchase
Fund") an amount equal to 1% of the aggregate par value
of the largest number of shares of 5.125% Cumulative
Preferred Stock at any time theretofore outstanding;
provided, however, that amounts set aside for Purchase
Funds heretofore or hereafter established for the several
series of Preferred Stock shall be set aside without
preference or priority as between series so that if at
any time there shall be a deficiency (including any
amount then required to be set aside) in the Purchase
Funds for two or more series of Preferred Stock, any
satisfaction of such deficiencies shall be made
simultaneously for such two or more Purchase Funds in
proportion to the amounts of the respective deficiencies
therein. On or before each such April 1 the Company
shall in writing, addressed to all holders of record of
the 5.125% Cumulative Preferred Stock, invite tenders of
5.125% Cumulative Preferred Stock at the par value
thereof, plus an amount equal to accrued dividends to the
next succeeding April 30, in an amount sufficient to
exhaust the moneys so set aside in the 5.125% Preferred
Stock Purchase Fund. The invitations for tenders shall
35
<PAGE>
specify how tenders shall be made and how notification of
acceptance thereof will be given. Tenders may be made on
or before April 25, in each year. If the par value of
the shares of 5.125% Cumulative Preferred Stock tendered
in response to any such invitation aggregates more than
the amount available in the 5.125% Preferred Stock
Purchase Fund such tenders shall be accepted pro rata (as
nearly as practicable without the purchase or issuance of
fractional shares or scrip therefor) in proportion to the
total number of shares of 5.125% Cumulative Preferred
Stock tendered respectively by the holders thereof who
shall have made such tenders, provided that in any event,
each holder of 5.125% Cumulative Preferred Stock shall be
entitled to tender and to have purchased by the Company
on each such invitation, at least the number of shares
(as nearly as practicable without the purchase or
issuance of fractional shares or scrip therefor) of the
5.125% Cumulative Preferred Stock held by such holder
which bears the same ratio to the total number of shares
to be purchased pursuant to the invitation as the number
of shares held of record by such holder at the close of
business on the last business day before the date of such
invitation, bears to the total number of shares of 5.125%
Cumulative Preferred Stock then outstanding. Tenders
shall be accepted of sufficient shares of 5.125%
Cumulative Preferred Stock to exhaust all of the moneys
in the 5.125% Preferred Stock Purchase Fund. Payment for
5.125% Cumulative Preferred Stock for which tenders shall
have been accepted shall be made on the April 30
following the last day for the making of tenders. To the
extent that tenders in any year are not made in an amount
sufficient to exhaust all of the moneys so held in the
5.125% Preferred Stock Purchase Fund, such excess moneys
in the 5.125% Preferred Stock Purchase Fund for that year
shall be released from the 5.125% Preferred Stock
Purchase Fund and become free funds to the Company. The
obligation to set aside amounts in the 5.125% Preferred
Stock Purchase Fund shall be cumulative, so that if, on
April 1 of each year cash in the required amount shall
not have been set aside in full, the amount of the
deficiency shall be added to the 5.125% Preferred Stock
Purchase Fund for the next succeeding year until the
total aggregate amount which shall have been set aside in
such 5.125% Preferred Stock Purchase Fund, and used or
released to the Company in accordance with the provisions
of this Section D.4, shall equal 1% of the aggregate par
value of the largest number of shares of 5.125%
Cumulative Preferred Stock at any time theretofore
outstanding, multiplied by the number of twelve month
periods which shall have elapsed since April 1, 1962. No
dividends shall be declared or paid upon or set apart for
any shares of Common Stock or any sums applied to the
purchase, redemption or other retirement of Common Stock,
so long as any such deficiency shall exist in the 5.125%
Preferred Stock Purchase Fund. Amounts to satisfy any
such deficiency in the 5.125% Preferred Stock Purchase
Fund, in whole or in part, may be set aside in the 5.125%
Preferred Stock Purchase Fund at any time, for
application in the manner aforesaid on the next
succeeding April 1, provided however, that if at any time
between any April 30 and January 1 of the following year
the amount so set aside in the 5.125% Preferred Stock
Purchase Fund shall aggregate $50,000 or more, the
Company shall immediately invite tenders of 5.125%
Cumulative Preferred Stock in the manner aforesaid, in an
amount sufficient to exhaust the moneys in the 5.125%
Preferred Stock Purchase Fund, at the par value thereof
plus an amount equal to accrued dividends to a date which
shall be thirty days from the date of such invitation,
the invitation to remain open for twenty-five days; and
on or before the thirtieth day following the date of such
invitation, the Company shall accept tenders and make
payment for 5.125% Cumulative Preferred Stock tendered,
at the price aforesaid in the same manner as above
provided with respect to moneys set aside in the
36
<PAGE>
5.125% Preferred Stock Purchase Fund on April I in each
year, and to the extent that tenders are not made in an
amount sufficient to exhaust the moneys so held in the
5.125% Preferred Stock Purchase Fund, such moneys shall
likewise be released from the 5.125% Preferred Stock
Purchase Fund and become free funds to the Company.
Amounts equal to accrued dividends on 5.125% Cumulative
Preferred Stock purchased through the 5.125% Preferred
Stock Purchase Fund shall be paid by the Company by the
use of moneys not in the 5.125% Preferred Stock Purchase
Fund, and shall not be charged to the 5.125% Preferred
Stock Purchase Fund. Shares of 5.125% Cumulative
Preferred Stock purchased through the 5.125% Preferred
Stock Purchase Fund shall be cancelled and shall not be
reissued.
5. On March 1, 1968 and on March 1 in each year thereafter
so long as any of the 4.60% (Series B) Cumulative
Preferred Stock shall remain outstanding, the Company
shall, subject to the provisions of Section C of this
Article, set aside as a Purchase Fund for the 4.60%
(Series B) Cumulative Preferred Stock (herein called the
"4.60% (Series B) Preferred Stock Purchase Fund") an
amount equal to 2% of the aggregate par value of the
largest number of shares of 4.60% (Series B) Cumulative
Preferred Stock at any time theretofore outstanding;
provided, however, that amounts set aside for Purchase
Funds heretofore or hereafter established for the several
series of Preferred Stock shall be set aside without
preference or priority as between series so that if at
any time there shall be a deficiency (including any
amount then required to be set aside) in the Purchase
Funds for two or more series of Preferred Stock, any
satisfaction of such deficiencies shall be made
simultaneously for such two or more Purchase Funds in
proportion to the amounts of the respective deficiencies
therein. On or before each such March 1 the Company
shall in writing, addressed to all holders of record of
the 4.60% (Series B) Cumulative Preferred Stock, invite
tenders of 4.60% (Series B) Cumulative Preferred Stock at
the par value thereof, plus an amount equal to accrued
dividends to the next succeeding March 31, in an amount
sufficient to exhaust the moneys so set aside in the
4.60% (Series B) Preferred Stock Purchase Fund. The
invitations for tenders shall specify how tenders shall
be made and how notification of acceptance thereof will
be given. Tenders may be made on or before March 25, in
each year. If the par value of the shares of 4.60%
(Series B) Cumulative Preferred Stock tendered in
response to any such invitation aggregates more than the
amount available in the 4.60% (Series B) Preferred Stock
Purchase Fund such tenders shall be accepted pro rata (as
nearly as practicable without the purchase or issuance of
fractional shares or scrip therefor) in proportion to the
total number of shares of 4.60% (Series B) Cumulative
Preferred Stock tendered respectively by the holders
thereof who shall have made such tenders, provided that
in any event, each holder of 4.60% (Series B) Cumulative
Preferred Stock shall be entitled to tender and to have
purchased by the Company on each such invitation, at
least the number of shares (as nearly as practicable
without the purchase or issuance of fractional shares or
scrip therefor) of the 4.60% (Series B) Cumulative
Preferred Stock held by such holder which bears the same
ratio to the total number of shares to be purchased
pursuant to the invitation as the number of shares held
of record by such holder at the close of business on the
last business day before the date of such invitation,
bears to the total number of shares of 4.60% (Series B)
Cumulative Preferred Stock then outstanding. Tenders
shall be accepted of sufficient shares of 4.60% (Series
B) Cumulative Preferred Stock to exhaust all of the
moneys in the 4.60% (Series B) Preferred Stock Purchase
Fund.
37
<PAGE>
Payment for 4.60% (Series B) Cumulative Preferred Stock
for which tenders shall have been accepted shall be made
on the March 31 following the last day for the making of
tenders. To the extent that tenders in any year are not
made in an amount sufficient to exhaust all of the moneys
so held in the 4.60% (Series B) Preferred Stock Purchase
Fund, such excess moneys in the 4.60% (Series B)
Preferred Stock Purchase Fund for that year shall be
released from the 4.60% (Series B) Preferred Stock
Purchase Fund and become free funds to the Company. The
obligation to set aside amounts in the 4.60% (Series B)
Preferred Stock Purchase Fund shall be cumulative, so
that if, on March 1 of each year cash in the required
amount shall not have been set aside in full, the amount
of the deficiency shall be added to the 4.60 % (Series B)
Preferred Stock Purchase Fund for the next succeeding
year until the total aggregate amount which shall have
been set aside in such 4.60% (Series B) Preferred Stock
Purchase Fund, and used or released to the Company in
accordance with the provisions of this Section D.5, shall
equal 2% of the aggregate par value of the largest number
of shares of 4.60% (Series B) Cumulative Preferred Stock
at any time theretofore outstanding, multiplied by the
number of twelve month periods which shall have elapsed
since March 1, 1967. No dividends shall be declared or
paid upon or set apart for any shares of Common Stock or
any sums applied to the purchase, redemption or other
retirement of Common Stock, so long as any such
deficiency shall exist in the 4.60% (Series B) Preferred
Stock Purchase Fund. Amounts to satisfy any such
deficiency in the 4.60% (Series B) Preferred Stock
Purchase Fund, in whole or in part, may be set aside in
the 4.60% (Series B) Preferred Stock Purchase Fund at any
time, for application in the manner aforesaid on the next
succeeding March 1, provided however, that if at any time
between March 31 and December 1 of any year the amount so
set aside in the 4.60% (Series B) Preferred Stock
Purchase Fund shall aggregate $85,000 or more, the
Company shall immediately invite tenders of 4.60% (Series
B) Cumulative Preferred Stock in the manner aforesaid, in
an amount sufficient to exhaust the moneys in the 4.60%
(Series B) Preferred Stock Purchase Fund, at the par
value thereof plus an amount equal to accrued dividends
to a date which shall be thirty days from the date of
such invitation, the invitation to remain open for
twenty-five days; and on or before the thirtieth day
following the date of such invitation, the Company shall
accept tenders and make payment for 4.60% (Series B)
Cumulative Preferred Stock tendered, at the price
aforesaid in the same manner as above provided with
respect to moneys set aside in the 4.60% (Series B)
Preferred Stock Purchase Fund on March 1 in each year,
and to the extent that tenders are not made in an amount
sufficient to exhaust the moneys so held in the 4.60%
(Series B) Preferred Stock Purchase Fund, such moneys
shall likewise be released from the 4.60% (Series
B) Preferred Stock Purchase Fund and become free funds to
the Company. Amounts equal to accrued dividends on 4.60%
(Series B) Cumulative Preferred Stock purchased through
the 4.60% (Series B) Preferred Stock Purchase Fund shall
be paid by the Company by the use of moneys not in the
4.60% (Series B) Preferred Stock Purchase Fund, and shall
not be charged to the 4.60% (Series B) Preferred Stock
Purchase Fund. Shares of 4.60% (Series B) Cumulative
Preferred Stock purchased through the 4.60% (Series B)
Preferred Stock Purchase Fund shall be cancelled and
shall not be reissued.
6. On January 1, 1972 and on January 1 in each year
thereafter so long as any of the 6% Cumulative Preferred
Stock shall remain outstanding, the Company shall,
subject to the provisions of Section C of this Article,
set aside as a Purchase Fund for the 6% Cumulative
Preferred Stock (herein called the "6% Preferred Stock
Purchase Fund") an amount equal to 2% of the aggregate
par value of the largest number of shares of 6%
Cumulative Preferred Stock at any time theretofore
outstanding; provided, however, that
38
<PAGE>
amounts set aside for Purchase Funds heretofore or
hereafter established for the several series of
Preferred Stock shall be set aside without preference or
priority as between series so that if at any time there
shall be a deficiency (including any amount then required
to be set aside) in the Purchase Funds for two or more
series of Preferred Stock, any satisfaction of such
deficiencies shall be made simultaneously for such two or
more Purchase Funds in proportion to the amounts of the
respective deficiencies therein. On or before each such
January 1 the Company shall in writing, addressed to all
holders of record of the 6% Cumulative Preferred Stock,
invite tenders of 6% Cumulative Preferred Stock at the
par value thereof, plus an amount equal to accrued
dividends to the next succeeding January 31, in an amount
sufficient to exhaust the moneys so set aside in the 6%
Preferred Stock Purchase Fund. The invitations for
tenders shall specify how tenders shall be made and how
notification of acceptance thereof will be given.
Tenders may be made on or before January 25, in each
year. If the par value of the shares of 6% Cumulative
Preferred Stock tendered in response to any such
invitation aggregates more than the amount available in
the 6% Preferred Stock Purchase Fund such tenders shall
be accepted pro rata (as nearly as practicable without
the purchase or issuance of fractional shares or scrip
therefor) in proportion to the total number of shares of
6% Cumulative Preferred Stock tendered respectively by
the holders thereof who shall have made such tenders,
provided that in any event, each holder of 6% Cumulative
Preferred Stock shall be entitled to tender and to have
purchased by the Company on each such invitation, at
least the number of shares (as nearly as practicable
without the purchase or issuance of fractional shares or
scrip therefor) of the 6% Cumulative Preferred Stock held
by such holder which bears the same ratio to the total
number of shares to be purchased pursuant to the
invitation as the number of shares held of record by such
holder at the close of business on the last business day
before the date of such invitation, bears to the total
number of shares of 6% Cumulative Preferred Stock then
outstanding. Tenders shall be accepted of sufficient
shares of 6% Cumulative Preferred Stock to exhaust all of
the moneys in the 6% Preferred Stock Purchase Fund.
Payment for 6% Cumulative Preferred Stock for which
tenders shall have been accepted shall be made on the
January 31 following the last day for the making of
tenders. To the extent that tenders in any year are not
made in an amount sufficient to exhaust all of the moneys
so held in the 6% Preferred Stock Purchase Fund, such
excess moneys in the 6% Preferred Stock Purchase Fund for
that year shall be released from the 6% Preferred Stock
Purchase Fund and become free funds to the Company. The
obligation to set aside amounts in the 6% Preferred Stock
Purchase Fund shall be cumulative, so that if, on January
1 of each year cash in the required amount shall not have
been set aside in full, the amount of the deficiency
shall be added to the 6% Preferred Stock Purchase Fund
for the next succeeding year until the total aggregate
amount which shall have been set aside in such 6%
Preferred Stock Purchase Fund, and used or released to
the Company in accordance with the provisions of this
Section D.6, shall equal 2% of the aggregate par value of
the largest number of shares of 6% Cumulative Preferred
Stock at any time theretofore outstanding, multiplied by
the number of twelve month periods which shall have
elapsed since January 1, 1971. No dividends shall be
declared or paid upon or set apart for any shares of
Common Stock or any sums applied to the purchase,
redemption or other retirement of Common Stock, so long
as any such deficiency shall exist in the 6% Preferred
Stock Purchase Fund. Amounts to satisfy any such
deficiency in the 6% Preferred Stock Purchase Fund, in
whole or in part, may be set aside in the 6% Preferred
39
<PAGE>
Stock Purchase Fund at any time, for application in the
manner aforesaid on the next succeeding January 1,
provided however, that if at any time between January 31
and October I of any year the amount so set aside in the
6% Preferred Stock Purchase Fund shall aggregate $80,000
or more, the Company shall immediately invite tenders of
6% Cumulative Preferred Stock in the manner aforesaid, in
an amount sufficient to exhaust the moneys in the 6%
Preferred Stock Purchase Fund, at the par value thereof
plus an amount equal to accrued dividends to a date which
shall be thirty days from the date of such invitation,
the invitation to remain open for twenty-five days; and
on or before the thirtieth day following the date of such
invitation, the Company shall accept tenders and make
payment for 6% Cumulative Preferred Stock tendered, at
the price aforesaid in the same manner as above provided
with respect to moneys set aside in the 6% Preferred
Stock Purchase Fund on January 1 in each year, and to the
extent that tenders are not made in an amount sufficient
to exhaust the moneys so held in the 6% Preferred Stock
Purchase Fund, such moneys shall likewise be released
from the 6% Preferred Stock Purchase Fund and become free
funds to the Company. Amounts equal to accrued dividends
on 6% Cumulative Preferred Stock purchased through the 6%
Preferred Stock Purchase Fund shall be paid by the
Company by the use of moneys not in the 6% Preferred
Stock Purchase Fund, and shall not be charged to the 6%
Preferred Stock Purchase Fund. Shares of 6% Cumulative
Preferred Stock purchased through the 6% Preferred Stock
Purchase Fund shall be cancelled and shall not be
reissued.
7. Subject to the provisions of Sections C and E of this
Article, prior to October 1, 1973 and prior to October 1
in each year thereafter so long as any of the 9.40%
Cumulative Preferred Stock shall remain outstanding, the
Company shall deposit with the Transfer Agent, as a
Sinking Fund for the 9.40% Cumulative Preferred Stock, an
amount equal to 2% of the aggregate par value of the
largest number of shares of 9.40% Cumulative Preferred
Stock at any time theretofore outstanding, plus an amount
equal to dividends accrued thereon to such October 1. The
Transfer Agent shall apply the moneys in such fund to
redeem on each such October 1, in accordance with the
provisions of Section E of this Article, shares of the
9.40% Cumulative Preferred Stock at Fifty Dollars
($50.00) per share, plus dividends accrued to the date of
redemption, provided that, in addition to the
restrictions contained in Sections C and E of this
Article, if, at any time, the Company shall be in default
in the performance of its obligations under this Sinking
Fund, thereafter and until all such defaults shall have
been remedied, the Company shall not redeem any Preferred
Stock unless all the shares of Preferred Stock
outstanding are redeemed, and shall not purchase or
otherwise acquire for value any shares of Preferred Stock
except out of amounts set aside as Purchase Funds or
Sinking Funds heretofore or hereafter established for one
or more of the series of Preferred Stock. The Company
may, upon notice to the Transfer Agent prior to August 15
in any year in which the Company shall be obligated to
redeem shares of the 9.40% Cumulative Preferred Stock
through the operation of the Sinking Fund, elect to
reduce its obligation in respect of the redemption of
shares so required to be redeemed by directing that any
shares of the 9.40% Cumulative Preferred Stock previously
purchased by the Company (other than shares purchased
pursuant to the operation of the Sinking Fund or
previously applied as a credit against the Sinking Fund)
shall be applied as a credit, in whole or in part, in an
amount equal to the aggregate par value of the shares so
applied, against the aggregate par value of the shares
required to be redeemed in such year pursuant to the
operation of the Sinking Fund.
8. Subject to the provisions of Sections C and E of this
Article, prior to July 1, 1974 and prior to July 1 in
each year thereafter so long as any of the 8.12%
Cumulative Preferred Stock shall remain outstanding, the
Company shall deposit with the Transfer Agent, as a
Sinking Fund for the 8.12% Cumulative Preferred Stock, an
amount equal to 2% of the aggregate par value of the
largest number of shares of 8.12% Cumulative Preferred
Stock at any time theretofore outstanding, plus an amount
equal to dividends accrued to such July 1 on the shares
to be redeemed therewith. The Transfer Agent shall apply
the moneys in such fund to redeem on each such July 1, in
accordance with the provisions of Section E of this
Article, shares of the 8.12% Cumulative Preferred Stock
at One Hundred Dollars ($100.00) per share, plus
dividends accrued to the date of redemption. The Company
may, upon notice to the Transfer Agent prior to April 15
in any year in which the Company shall be obligated to
redeem shares of the 8.12% Cumulative Preferred Stock
through the operation of the Sinking Fund, elect to
reduce its obligation in respect of the redemption of
shares so required to be redeemed by directing that any
shares of the 8.12% Cumulative Preferred Stock previously
purchased by the Company (other than shares purchased
pursuant to the operation of the Sinking Fund or
previously applied as a credit against the Sinking Fund)
shall be applied as a credit, in whole or in part, in an
amount equal to the aggregate par value of the shares so
applied, against the aggregate par value of the shares
40
<PAGE>
required to be redeemed in such year pursuant to the
operation of the Sinking Fund.
9. Subject to the provisions of Sections C and E of this
Article, prior to July 1, 1975 and prior to July 1 in
each year thereafter so long as any of the 7.70%
Cumulative Preferred Stock shall remain outstanding, the
Company shall deposit with the Transfer Agent, as a
Sinking Fund for the 7.70% Cumulative Preferred Stock, an
amount equal to 2% of the aggregate par value of the
largest number of shares of 7.70% Cumulative Preferred
Stock at any time theretofore outstanding, plus an amount
equal to dividends accrued to such July 1 on the shares
to be redeemed therewith. The Transfer Agent shall apply
the moneys in such fund to redeem on each such July 1, in
accordance with the provisions of Section E of this
Article, shares of the 7.70% Cumulative Preferred Stock
at One Hundred Dollars ($100.00) per share, plus
dividends accrued to the date of redemption. The Company
may, upon notice to the Transfer Agent prior to April 15
in any year in which the Company shall be obligated to
redeem shares of the 7.70% Cumulative Preferred Stock
through the operation of the Sinking Fund, elect to
reduce its obligation in respect of the redemption of
shares so required to be redeemed by directing that any
shares of the 7.70% Cumulative Preferred Stock previously
purchased by the Company (other than shares purchased
pursuant to the operation of the Sinking Fund or
previously applied as a credit against the Sinking Fund)
shall be applied as a credit, in whole or in part, in an
amount equal to the aggregate par value of the shares so
applied, against the aggregate par value of the shares
required to be redeemed in such year pursuant to the
operation of the Sinking Fund.
10. Subject to the provisions of Sections C and E of this
Article V, prior to January 1, 1985 and prior to January
1 in each year thereafter so long as any of the 8.72%
Cumulative Preferred Stock shall remain outstanding, the
Company shall deposit with the Transfer Agent, as a
Sinking Fund for the 8.72% Cumulative Preferred Stock, an
amount equal to 4% of the aggregate par value of the
largest number of shares of 8.72% Cumulative Preferred
Stock at any time theretofore outstanding and, in
addition, the Company may, at its option, deposit in such
fund up to an equal amount plus, in each case, an amount
equal to dividends accrued to such January 1 on the
shares to be redeemed therewith. The right to make such
optional deposit shall not be cumulative and shall not
reduce any subsequent mandatory Sinking Fund payment. If
the Company shall intend to exercise its right to make an
optional Sinking Fund payment in any year, it shall
deliver to the Transfer Agent prior to November 15 of
such year notice of its intent to exercise such optional
right. Thereupon, the amount required to be deposited in
such fund by the first sentence of this paragraph shall
be increased by, and shall include, the additional amount
specified in such notice. The Transfer Agent shall apply
the moneys in such fund to redeem on each such January 1,
in accordance with the provisions of Section E of this
Article, shares of the 8.72% Cumulative Preferred Stock
at Fifty Dollars ($50.00) per share, plus dividends
accrued to the date of redemption. The Company may, upon
notice to the Transfer Agent prior to November 15 in any
year in which the Company shall be obligated to redeem
shares of the 8.72% Cumulative Preferred Stock through
the operation of the Sinking Fund, elect to reduce its
obligation in respect of the redemption of shares so
required to be redeemed by directing that any shares of
the 8.72% Cumulative Preferred Stock previously purchased
by the Company (other than shares purchased pursuant to
the operation of the Sinking Fund or previously applied
41
<PAGE>
as a credit against the Sinking Fund) shall be applied as
a credit, in whole or in part, in an amount equal to the
aggregate par value of the shares so applied, against the
aggregate par value of the shares required to be redeemed
in such year pursuant to the operation of the Sinking
Fund.
E. The Preferred Stock of any series at any time outstanding
may be redeemed by the Company (except as may be
otherwise provided by the resolution or resolutions
adopted by the Board of Directors pursuant to Section B.2
(or its successor) of this Article V in the case of any
series of Preferred Stock established by the Board of
Directors pursuant to said Section B.2 (or its
successor)). Any such redemption by the Company shall be
at its election expressed by resolution adopted by its
Board of Directors, as a whole at any time or in part
from time to time, on not less than thirty (30) nor more
than sixty (60) days' prior written notice given as
herein provided, at the then applicable redemption prices
per share set forth below with respect to shares of the
presently designated series of Preferred Stock as set
forth in Exhibit A hereto and, in addition thereto, in
each case, an amount which, together with the aggregate
of the dividends previously paid upon such share, shall
be equal to dividends accrued upon such share at the
annual dividend rate indicated below (but without
interest) from the date from which the dividends thereon
became cumulative to the date of redemption:
<TABLE>
<C> <C> <S> <C> <S><C>
Date Fixed Redemption Dividend
Series for Redemption Price Rate
(a) 5% Preferred Stock Any date $ 52.50 $2.50
(b) 4.60% Cumulative Preferred Stock Any date $ 50.50 $2.30
(c) 4.50% Cumulative Preferred Stock Any date $ 51.00 $2.25
(d) 4.60% (Series A) Cumulative Any date $ 51.00 $2.30
Preferred Stock
(e) 5.125% Cumulative Preferred Stock Any date $ 51.00 $2.5625
(f) 4.60% (Series B) Cumulative Any date $ 50.50 $2.30
Preferred Stock
(g) 6% Cumulative Preferred Stock Any date $ 50.50 $3.00
(h) 9.40% Cumulative Preferred Stock Any date $ 51.175 $4.70
(i) 8.12% Cumulative Preferred Stock Any date $102.03 $8.12
(j) 7.70% Cumulative Preferred Stock Any date $101.00 $7.70
(k) 8.40% Cumulative Preferred Stock On or prior to
November 30, 1991 $104.70 $8.40
December 1, 1991 through
November 30, 1996 $102.80
On and after December 1, 1996 $101.00
42
PAGE
<C> <C> <S>
Annual
Date Fixed Redemption Dividend
Series for Redemption Price Rate
(1) 8.72% Cumulative Preferred Stock On or prior to
December 31, 1993 $52.00 $4.36
January 1, 1994 through
December 31, 1998 51.00
On and after January 1, 1999 50.00
</TABLE>
and, in the case of any series of Preferred Stock
established by the Board of Directors pursuant to
Section B.2 (or its successor) of this Article V to be
redeemed, at the redemption price per share of shares
of such series fixed and determined by the resolution
or resolutions of the Board of Directors establishing
such series in effect at the time of such redemption,
and, in addition thereto, an amount which, together
with the aggregate of the dividends previously paid
upon such share, will be equal to the annual dividend
rate for such series fixed and determined by the
resolution or resolutions of the Board of Directors
establishing such series (but without interest) from
the date from which the dividends thereon became
cumulative to the date of redemption. Redemption may
be made at any time of either the whole or any part of
the shares of any series of Preferred Stock without
redeeming the whole or any part of the shares of any
other series of Preferred Stock; provided that if, at
any time, the Company shall fail to pay dividends in
full on any outstanding shares of any series of
Preferred Stock, thereafter and until dividends in full
on all such shares shall have been paid, or declared
and set apart for payment, for all past dividend
periods, the Company shall not redeem any Preferred
Stock unless all the shares of Preferred Stock
outstanding are redeemed, and shall not purchase or
otherwise acquire for value any shares of Preferred
Stock otherwise than in accordance with an offer made
to all holders of shares of Preferred Stock; and
provided further if, at any time, the Company shall be
in default in the performance of its obligations under
any Purchase Fund or Sinking Fund provisions heretofore
or hereafter fixed and determined for any series of
Preferred Stock pursuant to this Article V, thereafter
and until all such defaults shall have been remedied,
the Company shall not redeem any Preferred Stock unless
all the shares of Preferred Stock outstanding are
redeemed, and shall not purchase or otherwise acquire
for value any shares of Preferred Stock except out of
amounts set aside as Purchase Funds or Sinking Funds
heretofore or hereafter established for one or more of
the series of Preferred Stock. In case of the
redemption of a part only of any series of Preferred
Stock at the time outstanding, the shares of Preferred
Stock to be redeemed shall be selected by lot, in such
manner as the Company may determine, by a bank or trust
company selected for that purpose by the Company.
Notice of the election of the Company to redeem any of
the Preferred Stock shall be given by the Company by
mailing a copy of such notice, postage prepaid, not
less than thirty (30) nor more than sixty (60) days
prior to the date designated therein as the date for
such redemption, to the holders of record on the date
of such mailing of the shares of Preferred Stock to be
redeemed, addressed to them at their respective
addresses appearing on the books of the Company. Such
notice shall state that such shares of Preferred Stock
will be redeemed at the redemption price aforesaid and
on the date specified in such notice, upon the
surrender for cancellation, at the place designated in
such notice, of the certificates representing such
shares of Preferred Stock, properly endorsed in blank
for transfer or accompanied by proper instruments of
assignment and transfer in blank (if required by the
Company) and bearing all necessary transfer stamps
thereto affixed and cancelled. On and after the date
specified in such notice, each holder of shares of
Preferred Stock called for redemption as aforesaid,
upon presentation and surrender at the place designated
in such notice of the certificates for shares of
Preferred Stock held by him, properly endorsed in blank
for transfer or accompanied by proper instruments of
assignment and transfer in blank (if required by the
Company), and bearing all necessary transfer tax stamps
thereto affixed and cancelled, shall be entitled to
43
<PAGE>
receive therefor the redemption price hereinbefore
specified. From and after the date of redemption
specified in such notice (unless default shall be made
by the Company in providing moneys for the payment of
the redemption price), all dividends on the shares of
Preferred Stock so called for redemption shall cease to
accrue and, from and after said date (unless default
shall be made by the Company as aforesaid), or, if the
Company shall so elect, from and after the date (prior
to the date of redemption so specified) on which the
Company shall provide the moneys for the payment of the
redemption price by depositing the amount thereof with
a bank or trust company doing business in the Borough
of Manhattan, City and State of New York, and having a
capital and surplus of at least $5,000,000, provided
that the notice of redemption shall have stated the
intention of the Company to deposit such amount on a
date in such notice specified, all rights of the
holders of the shares so called for redemption as
stockholders of the Company, except only the right to
receive the redemption price then due, shall cease and
determine. Subject to the foregoing provisions of this
Section E, the Company may also from time to time
repurchase shares of any series of its Preferred Stock
at not exceeding the respective redemption prices
thereof. All shares of Preferred Stock so redeemed
shall be retired and shall not be reissued, but the
Company may, nevertheless, from time to time thereafter
increase and/or reclassify its capital stock in the
manner and to the extent permitted by law and by its
Charter.
F. At all elections of directors of the Company, and on
all other matters, except on matters in respect of
which the laws of the State of South Carolina shall
provide that all stockholders shall have the right to
vote irrespective of whether such right has been
relinquished by any of such stockholders and except as
otherwise herein provided, the holders of the Common
Stock shall have the exclusive right to vote, provided,
however, that, if and whenever four (4) quarterly
dividends payable on the Preferred Stock shall be
unpaid in whole or in part, the holders of the
Preferred Stock as a class, all the shares of all
series of Preferred Stock then outstanding taken
together constituting the class, shall have the
exclusive right to vote for and to elect the smallest
number of directors which shall constitute a majority
of the then authorized number of directors of the
Company, and in all matters other than the election of
directors, each holder of one or more shares of any
series of Preferred Stock shall be entitled to such
vote for each such share held by him as is provided in
paragraph 3.F of Section B of this Article V. In the
event of defaults entitling the Preferred Stock to vote
as aforesaid, the holders of the Common Stock as a
class shall have the exclusive right to vote for and to
elect the greatest number of directors which shall
constitute a minority of the then authorized number of
directors of the Company and in all matters other than
the election of directors, each holder of Common Stock
shall be entitled to one vote for each share of stock
held by him. The voting rights of the holders of the
Preferred Stock, however, shall cease when all
accumulated and unpaid dividends on their stock shall
have been paid in full. The terms of office of all
persons who may be directors of the Company, at the
time when the right to elect a majority of the
directors shall accrue to the holders of the Preferred
Stock as herein provided, shall terminate upon the
election of their successors at a meeting of the
stockholders of the Company then entitled to vote.
Whenever the right shall have accrued to the holders of
Preferred Stock to elect directors, the Board of
Directors shall, within ten days after delivery to the
Company at its principal office of a request to such
effect signed by any holder of shares of the Preferred
Stock entitled to vote, call a special meeting of the
stockholders to be held within forty days from the
delivery of such request for the purpose of electing
44
<PAGE>
directors. The notice of such meeting shall be similar
to that provided in the ByLaws for an annual meeting of
stockholders. Any vacancy in the Board of Directors
occurring during any period that the Preferred Stock
shall have representatives on the Board shall be filled
by a majority vote of the remaining directors
representing the class of stock theretofore represented
by the director causing the vacancy. Upon the
termination of such exclusive right of the holders of
the Preferred Stock to elect a majority of the
directors of the Company, the terms of office of all
the directors of the Company shall terminate upon the
election of their successors at a meeting of the
stockholders of the Company then entitled to vote.
Whenever the right of holders of shares of Preferred
Stock to elect directors shall have terminated, the
Board of Directors shall, within ten days after
delivery to the Company at its principal office of a
request to such effect signed by any holders of shares
of Common Stock entitled to vote, call a special
meeting of the stockholders to be held within forty
days from the delivery of such request for the purpose
of electing directors. The notice of such meeting
shall be similar to that provided in the By-Laws for an
annual meeting of stockholders.
G. So long as any of the Preferred Stock shall be
outstanding, unless provision has been made for the
redemption thereof as provided in Section E of this
Article V:
1. The Company shall not, without the affirmative vote
or written consent of the holders of at least two-
thirds of the total voting power of all shares of
Preferred Stock then outstanding, all of said
shares voting as a single class (in addition to any
other vote or consent at the time required by law),
(a) create or issue any shares of stock, in
addition to the shares which the Company is then
authorized to issue, which would rank equally with
or prior to the Preferred Stock or authorize any
increase of the Preferred Stock now authorized, or
(b) amend its charter so as to change, alter or
repeal the provisions contained herein relating to
the preferences, voting powers, restrictions and
qualifications of any series of Preferred Stock,
provided, however, that if any such amendment,
alteration or repeal would decrease the rights and
preferences of outstanding shares of Preferred
Stock of one or more series without proportionately
decreasing the rights and preferences of the
outstanding shares of the other series, then like
consent by the holders of at least two-thirds of
the total voting power of the Preferred Stock of
the former one or more series (voting as a class)
at the time outstanding shall also be necessary for
effecting or validating any such amendment,
alteration or repeal, provided further, however,
that the establishment and designation of any
series of Preferred Stock, and the fixing and
determination of the relative rights and
preferences thereof, pursuant to Section B.2 (or
its successor) of this Article V including, without
limiting the generality of the foregoing,
provisions for a Purchase Fund or Sinking Fund,
with respect to such series, which shall rank pari
passu with the Purchase Funds and Sinking Funds
heretofore provided for shares of the established
series of Preferred Stock designated as set forth
in Exhibit A hereto or with any Purchase Fund or
Sinking Fund for any series of Preferred Stock
hereafter established, shall not be deemed to be an
amendment of the Company's charter which changes,
alters or repeals the provisions contained herein
relating to the preferences, voting powers,
restrictions and qualifications of any series of
Preferred Stock or which decreases the rights and
preferences of outstanding shares of Preferred
Stock of any series and shall not require the
affirmative vote or written consent of the holders
45
<PAGE>
of Preferred Stock of any series heretofore or
hereafter established, and provided further, that
if any such amendment or alteration would increase
the authorized number of shares of any series of
Preferred Stock referred to in Exhibit A hereto,
then like consent by the holders of at least two-
thirds in amount of each such series so affected
shall also be necessary for effecting or validating
any such amendment or alteration, and provided
further that if any such amendment or alteration
would increase the authorized number of shares of
any series of Preferred Stock hereafter established
by the Board of Directors pursuant to Section B.2
(or its successor) of this Article V, then like
consent of the holders of at least two-thirds in
amount of such series shall also be necessary for
effecting or validating any such amendment or
alteration or (c) issue any shares of Preferred
Stock in addition to the initial series of 125,234
shares of the 5% Preferred Stock, 60,000 shares of
the 4.60% Cumulative Preferred Stock, 80,000 shares
of the 4.50% Cumulative Preferred Stock, 100,000
shares of the 4.60% (Series A) Cumulative Preferred
Stock, 100,000 shares of the 5.125% Cumulative
Preferred Stock and 170,000 shares of the 4.60%
(Series B) Cumulative Preferred Stock (i) unless
for any twelve consecutive calendar months
immediately preceding the calendar month within
which such additional shares of Preferred Stock
shall be issued, the net earnings of the Company
available for the payment of interest charges on
the Company's indebtedness, determined after
provision for depreciation, amortization of utility
plant acquisition adjustment accounts, and all
taxes, in accordance with sound accounting
practice, shall have been at least one and one-half
times the aggregate for a twelve months' period of
the interest charges on indebtedness of the Company
and the dividend requirements on all shares of
Preferred Stock to be outstanding immediately after
the proposed issue of such additional shares
thereof, provided that there shall be excluded from
the foregoing computation interest charges on all
indebtedness and dividends on all stock which are
to be retired in connection with the issue of such
additional shares of Preferred Stock, and also
provided that, where such additional shares of
Preferred Stock are to be issued in connection with
the acquisition of new property, the net earnings
of the property to be so acquired may be included
on a pro forma basis in the foregoing computation,
computed on the same basis as the net earnings of
the Company, and (ii) unless the aggregate of the
capital of the Company applicable to the Common
Stock and the surplus of the Company shall be not
less than the amount payable upon involuntary
dissolution to the holders of the Preferred Stock
to be outstanding immediately after the proposed
issue of such additional Preferred Stock, excluding
from the foregoing computation all indebtedness and
stock which are to be retired in connection with
the issue of such additional shares of Preferred
Stock, provided, that no portion of the surplus of
the Company which shall be used to meet the
requirements of this clause (ii) shall, after the
issue of such additional shares of Preferred Stock
and until such additional shares or a like number
of other shares of Preferred Stock shall have been
retired, be available for dividends or other
distribution upon the Common Stock; and
46
<PAGE>
2. The Company shall not, without the consent of the
Preferred and Common Stock at a meeting duly called
for the purpose, which consent must be evidenced by
(a) a simple majority vote of the total voting
power of all shares of Preferred Stock then
outstanding, each of said shares being entitled to
such vote per share as is provided in paragraph 3.F
of Section B of this Article V and voting as a
single class, (b) a simple majority vote of the
total number of shares of Common Stock then
outstanding, each of said shares being entitled to
one vote per share, and (c) a two-thirds majority
vote of the then outstanding Preferred and Common
Stock voting as a single class, each outstanding
share of Preferred Stock being entitled to twenty
times the vote per share provided in paragraph 3.F
of Section B of this Article V and each
outstanding share of Common Stock being entitled to
one vote per share (in addition to any other vote
or consent at the time required by law),
consolidate or merge with or into any other
corporation or corporations, permit the
consolidation or merger of any other corporation or
corporations into it, or sell, lease or otherwise
transfer all or the greater part of the assets of
the Company; provided, however, that the Board of
Directors of the Company, by resolution, shall have
the right at any time without the vote or consent
of stockholders of any class, to mortgage or
otherwise subject to lien or pledge all or any part
of the assets of the Company for proper corporate
purposes.
3. The Company, except for the purposes of:
(a) refunding outstanding unsecured indebtedness
theretofore issued or assumed by the Company,
(b) redeeming or retiring all outstanding shares
of Preferred Stock, or
(c) reimbursing the Company, in whole or in part,
for moneys deposited by it to provide for the
redemption or retirement of all outstanding
shares of one or more series of the Preferred
Stock,
shall not, without the consent (given by vote at a
meeting duly called for the purpose) of the holders
of at least a majority of the total voting power of
all shares of Preferred Stock then outstanding, all
of said shares voting as a single class, issue any
unsecured notes, debentures or other securities
representing unsecured indebtedness, or assume any
such unsecured indebtedness, if, immediately after
such issue or assumption, as the case may be, the
total principal amount of all unsecured notes,
debentures or other securities representing
unsecured indebtedness issued or assumed by the
Company and then outstanding (including unsecured
securities then to be issued or assumed) would
exceed (i) $8,000,000 or (ii) ten per cent (10%) of
the aggregate of the total principal amount of all
bonds or other securities representing secured
indebtedness issued or assumed by the Company and
then outstanding and the capital and surplus of the
Company as then stated on the books of account of
the Company, whichever amount is greater, provided,
however, that no such consent shall be required in
connection with the Company's entering into any
agreement for the payment of such amounts of money
as may be necessary to meet payments of interest,
principal or premium on and incidental costs with
respect to securities issued by tax-exempt public
agencies for the purpose of financing, directly or
indirectly, the cost of facilities used or to be
47
<PAGE>
used by the Company or in connection with the
Company's business or operations which are designed
to eliminate, mitigate or prevent air or water
pollution or radiation emissions or otherwise to
prevent or ameloriate potentially adverse side
effects of the Company's business or operations on
the environment or public health. Nothing herein
contained shall be deemed to require such vote of
Preferred Stockholders to enable the Company to
make or assume any indebtedness secured by
mortgage, pledge or collateral.
H. The holders of shares of any series of Preferred
Stock shall have no right whatever to subscribe for or
purchase or to have offered to them for subscription or
purchase any additional shares of stock of any class,
character or description, or obligations of any kind of
the Company convertible into stock of any class of the
Company, or to which shall be attached or appertain any
warrant or warrants or other instrument or instruments
that shall confer upon the holder or holders of such
obligations the right to subscribe for, or to purchase
or receive from the Company, any shares of capital
stock of any class of the Company, whether now or
hereafter authorized.
I. No holder of Common Stock of the Company shall have any
preemptive right to subscribe for, purchase or
otherwise acquire any additional shares of Common Stock
of the Company, or any options or rights to purchase
shares of Common Stock of the Company, or any
securities convertible into or carrying options or
rights to purchase shares of Common Stock of the
Company, whether now or hereafter authorized, and
whether issued or granted for cash, property, services
or otherwise.
ARTICLE VI
The number of directors of the Corporation shall be such number
permitted by law as shall be fixed by the Corporation's By-Laws. They shall
manage the business, property and affairs of the Corporation.
Dated: December 15, 1993
SOUTH CAROLINA ELECTRIC & GAS COMPANY
By: B. TATE HORTON, JR.
Vice President and Treasurer
By: KEVIN B. MARSH
Secretary
Note: Any person signing this form, shall either opposite
or beneath his signature, clearly and legibly state his
name and the capacity in which he signs. Must be signed
by the Chairman of the Board of Directors, the president
or another of its officers in accordance with Section
33-1-200 of the South Carolina Business Corporation Act
of 1988.
48
<PAGE>
STATE OF SOUTH CAROLINA
COUNTY OF RICHLAND
The undersigned B. TATE HORTON, JR. and KEVIN B. MARSH do hereby certify
that they are the duly elected and acting Vice President and Treasurer and
Secretary, respectively, of SOUTH CAROLINA ELECTRIC & GAS COMPANY and are
authorized to execute this verification; that each of the undersigned for
himself does hereby further certify that he has read the foregoing document,
understands the meaning and purport of the statements therein contained and
the same are true to the best of his information and belief.
Dated at Columbia, S. C., this 15th day of December, 1993.
B. TATE HORTON, JR
Vice President and Treasurer
KEVIN B. MARSH
Secretary
49
<PAGE>
EXHIBIT A
TO
RESTATED ARTICLES OF INCORPORATION
OF
SOUTH CAROLINA ELECTRIC & GAS COMPANY
Statement of Authorized Shares of Stock and of Preferred Stock
unissued and undesignated as to Series and issued,
outstanding and designated as to Series
________________________________________________________________
As of the effective date of this Exhibit A:
1. Authorized Classes.
The total number of shares which the Company shall be
authorized to issue is 55,515,095, of which 2,000,000 shall be
Preferred Stock of the par value of $25 per share, issuable in
series, 1,765,095 shall be Preferred Stock of the par value of $50
per share, issuable in series, 1,750,000 shall be Preferred Stock
of the par value of $100 per share, issuable in series, and
50,000,000 shall be Common Stock of the par value of $4.50 per
share.
2. Preferred Stock unissued and undesignated as to series
and issued, outstanding and designated as to series.
(a) Par Value $25 per share
(i) 2,000,000 unissued and undesignated as to series.
(b) Par Value $50 per share-entitled to one vote per share.
(i) 442,809 shares unissued and undesignated as to
series
(ii) 125,209 shares unissued and outstanding designated
"5% Preferred Stock"
(iii) 3,834 shares issued and outstanding designated
"4.60% Cumulative Preferred Stock"
(iv) 20,800 shares issued and outstanding designated
"4.50% Cumulative Preferred Stock"
(v) 30,052 shares issued and outstanding designated
"4.60% (Series A) Cumulative Preferred Stock"
(vi) 74,000 shares issued and outstanding designated
"5.125% (Series A) Cumulative Preferred Stock"
(vii) 81,600 shares issued and outstanding designated
"4.60% (Series B) Cumulative Preferred Stock"
50
<PAGE>
(viii) 89,600 shares issued and outstanding designated
"6% Cumulative Preferred Stock"
(ix) 197,191 shares issued and outstanding designated
"9.40% Cumulative Preferred Stock"
Total 1,065,095
(c) Par Value $50 per share-entitled
to one half of one vote per share
(i) 540,000 shares unissued and undesignated as to
series
(ii) 160,000 shares issued and outstanding designated
"8.72% Cumulative Preferred Stock"
Total 700,000
(d) Par Value $100 per share
(i) 1,327,442 unissued and undesignated as to series
(ii) 131,899 shares issued and outstanding designated
"8.12% Cumulative Preferred Stock"
(iii) 92,991 shares issued and outstanding designated
"7.70% Cumulative Preferred Stock"
(iv) 197,668 shares issued and outstanding designated
"8.40% Cumulative Preferred Stock"
Total 1,750,000
3. Shares Outstanding
The total number of shares issued and outstanding is
41,500,991, consisting of:
(a) 40,296,147 shares of Common Stock;
(b) 0 shares of Preferred Stock par value $25 per share;
(c) 622,286 shares of Preferred Stock par value $50 per
share-entitled to one vote per share;
(d) 160,000 shares of Preferred Stock par value $50 per
share-entitled to one-half of one vote per share; and
(e) 422,558 shares of Preferred Stock par value $100 per
share.
December 15, 1993
51
<PAGE>
Exhibit 3-B
STATE OF SOUTH CAROLINA
SECRETARY OF STATE
ARTICLES OF AMENDMENT
Pursuant to Section 3-10-106 of the 1976 South Carolina Code, as
amended, the undersigned corporation adopts the following Articles of
Amendment to its Articles of Incorporation:
1. The name of the Corporation is SOUTH CAROLINA ELECTRIC & GAS
COMPANY.
2. On , the corporation adopted the following
Amendment(s) of its Articles of Incorporation:
NOT APPLICABLE
3. The manner, if not set forth in the amendment, in which any
exchange, reclassification, or cancellation of issued shares
provided for in the Amendment shall be effected, is as follows:
(a) The number of redeemable shares of the corporation reacquired
by redemption or purchase is 39,871 itemized as follows:
Class Series No. of Shares
Cumulative Preferred Stock ($50 par value) 4.60% (Series B) 3,400
Cumulative Preferred Stock ($50 par value) 5.125% 1,000
Cumulative Preferred Stock ($50 par value) 6% 3,200
Cumulative Preferred Stock ($50 par value) 8.72% 32,044
Cumulative Preferred Stock ($50 par value) 9.40% 88
Cumulative Preferred Stock ($100 par value) 8.12% 139
(b) The aggregate number of issued shares of the corporation after giving
effect to such cancellation is 41,461,121, itemized as follows:
Class Series No. of Shares
Cumulative Preferred Stock ($50 par value) 5% 125,209
Cumulative Preferred Stock ($50 par value) 4.60% 3,834
Cumulative Preferred Stock ($50 par value) 4.50% 20,800
Cumulative Preferred Stock ($50 par value) 4.60% (Series A) 30,052
Cumulative Preferred Stock ($50 par value) 5.125% 73,000
Cumulative Preferred Stock ($50 par value) 4.60% (Series B) 78,200
Cumulative Preferred Stock ($50 par value) 6% 86,400
Cumulative Preferred Stock ($50 par value) 9.40% 197,103
Cumulative Preferred Stock ($100 par value) 8.12% 131,760
Cumulative Preferred Stock ($100 par value) 7.70% 92,992
Cumulative Preferred Stock ($100 par value) 8.40% 197,668
Cumulative Preferred Stock ($50 par value) 8.72% 127,956
Common Stock ($4.50 par value) 40,296,147
41,461,121
(c) The amount of the stated capital of the corporation after
giving effect to such cancellation is $260,702,361.50.
(d) The number of shares which the corporation has authority to
issue after giving effect to such cancellation is 55,507,495,
itemized as follows:
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Class Series No. of Shares
Cumulative Preferred Stock ($50 par value) 5% 125,209
Cumulative Preferred Stock ($50 par value) 5% 125,209
Cumulative Preferred Stock ($50 par value) 5% 125,209
Cumulative Preferred Stock ($50 par value) 4.60% 3,834
Cumulative Preferred Stock ($50 par value) 4.50% 20,800
Cumulative Preferred Stock ($50 par value) 4.60% (Series A) 30,052
Cumulative Preferred Stock ($50 par value) 5.125% 73,000
Cumulative Preferred Stock ($50 par value) 4.60% (Series B) 78,200
Cumulative Preferred Stock ($50 par value) 6% 86,400
Cumulative Preferred Stock ($50 par value) 9.40% 197,103
Cumulative Preferred Stock ($100 par value) 8.12% 131,760
Cumulative Preferred Stock ($100 par value) 7.70% 92,992
Cumulative Preferred Stock ($100 par value) 8.40% 197,668
Cumulative Preferred Stock ($50 par value) 8.72% 127,956
Serial Preferred Stock ($50 par value) (1 vote) 442,897
Serial Preferred Stock ($100 par value) (1 vote) 1,327,580
Serial Preferred Stock ($25 par value) (1/4 vote) 2,000,000
Serial Preferred Stock ($50 par value) (1/2 vote) 572,044
Common Stock ($4.50 par value) 50,000,000
55,507,495
4. (a) / / Amendment(s) adopted by shareholder action.
At the date of adoption of the amendment, the number of
outstanding shares of each voting group entitled to vote separately on
the Amendment, and the vote of such shares was:
Number of Number of Number of Votes Number of Undisputed
Voting Outstanding Votes Entitled Represented at Shares Voted
Group Shares to be Cast the meeting For Against
(b) / XX / The Amendment(s) was duly adopted by the incorporators
or board of directors without shareholder approval pursuant to Section
33-6-102(d), 33-10-102 and 33-10-105 of the 1976 South Carolina Code,
as amended, and shareholder action was not required.
5. Unless a delayed date is specified, the effective date of these
Articles of Amendment shall be the date of acceptance for filing
by the Secretary of State (See Section 33-1-230(b)).
Date June 7, 1994 SOUTH CAROLINA ELECTRIC & GAS COMPANY
By: K. B. Marsh
Secretary
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Exhibit 12
SOUTH CAROLINA ELECTRIC & GAS COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
For the Twelve Months Ended June 30, 1994
(Thousands of Dollars)
Twelve Months
Ended
June 30, 1994
Fixed Charges as defined:
Interest on long-term debt.............. $ 79,413
Amortization of debt premium, discount
and expense (net)...................... 1,956
Interest on debt to affiliate........... 168
Other interest expense.................. 4,305
Interest component of rentals........... 2,868
Total Fixed Charges (A)............. $ 88,710
Earnings, as defined:
Income.................................. $157,509
Income taxes............................ 92,360
Total fixed charges above............... 88,710
Total Earnings (B).................. $338,579
Ratio of Earnings to fixed charges (B/A).. 3.82
54
