As filed with the Securities and Exchange Commission on
April 1, 2004
File No. 70-10204
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------------------------
PRE-EFFECTIVE AMENDMENT NO. 1
TO THE
APPLICATION-DECLARATION
ON FORM U-1
UNDER THE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
-------------------------------------------------
UNITIL CORPORATION
6 Liberty Lane West
Hampton, New Hampshire 03842-1720
------------------------------------------------
(Name of companies filing this statement and
address of principal executive offices)
UNITIL CORPORATION
6 Liberty Lane West
Hampton, New Hampshire 03842-1720
-------------------------------------------------
(Name of top registered holding company parent)
Mark H. Collin
Senior Vice President, Chief Financial Officer & Treasurer
UNITIL CORPORATION
6 Liberty Lane West
Hampton, New Hampshire 03842-1720
-------------------------------------------------
(Name and address of agent for service)
The Commission is requested to mail copies of all orders,
notices and communications to:
Sheri E. Bloomberg, Esq.
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
125 West 55th Street
New York, New York 10019
ITEM 1. DESCRIPTION OF PROPOSED TRANSACTIONS
Unitil Corporation, a New Hampshire corporation ("Unitil" or "Applicant")
and a registered holding company under the Public Utility Holding Company Act of
1935, as amended (the "Act"), hereby submits this pre -effective amendment no. 1
to its application-declaration on Form U-1 (File No. 70- 10204) (the
"Application-Declaration") to the Securities and Exchange Commission (the
"Commission") for authorization and approval under Sections 6(a) and 7 of the
Act with respect to the issuance of up to 177,500 shares of common stock, no par
value ("Common Stock"), of Unitil under the Unitil Corporation 2003 Restricted
Stock Plan (the "Plan"), such number of shares to be subject to adjustment in
accordance with the provisions of the Plan.
The Plan was adopted by the Board of Directors of Unitil (the "Board") in
January 2003 and became effective after the adoption was approved by Unitil's
shareholders in April 2003. In accordance with the terms of the Plan, awards for
shares of restricted stock may be granted under the Plan and are evidenced by an
Award Agreement, entered into by the participant and Unitil, setting forth the
terms and provisions applicable to the award. Persons eligible to participate in
the Plan include all employees, directors and consultants of Unitil, its
subsidiaries and its affiliates (collectively, the "Unitil Companies"). The
Company entered into the initial set of award agreements under the Plan with
employees of the Unitil Companies in May 2003 relating to 10,600 shares, the
restrictions on which begin to lapse in May 2004 in accordance with the terms of
the Plan (described in detail below).
The aggregate maximum number of shares of restricted stock available for
awards to participants under the Plan (including these subject to the initial
set of awards) is 177,500./1 The maximum aggregate number of shares of
restricted stock that may be awarded in any one calendar year to any one
participant is 20,000. In the event of any change in capitalization of Unitil,
the Compensation Committee of the Board (the "Compensation Committee) is
authorized to make proportionate adjustments to prevent dilution or enlargement
of rights, including, without limitation, an adjustment in the maximum number
and kinds of shares available for awards and in the annual award limit.
The Plan is administered by the Compensation Committee. Except as limited
by law or by the Articles of Incorporation or the By-laws of Unitil, and subject
to the provisions of the Plan, the Compensation Committee shall have full power
to select the persons who shall participate in the Plan; determine the sizes of
awards; determine the terms and conditions of awards in a manner consistent with
the Plan; construe and interpret the Plan and any agreement or instrument
entered into under the Plan as they apply to participants; establish, amend, or
waive rules and regulations for the Plan's administration as they apply to
participants; and, subject to the provisions of the Plan, amend the terms and
conditions of any outstanding award to the extent such terms and conditions are
within the discretion of the Compensation Committee as provided in the Plan.
--------
1 At the time that the Plan was adopted, Unitil also terminated its stock option
plan previously approved by the Commission (Holding Co. Act Release No. 26978
(Feb. 17, 1999)) under which 177,500 options and underlying shares of Common
Stock remained authorized for issuance.
The objectives of the Plan are to optimize the profitability and growth of
Unitil through incentives that are consistent with Unitil's goals and that link
the personal interests of Plan participants to those of Unitil's shareholders,
to attract and retain employees and directors of outstanding ability, and to
promote teamwork among participants. The Plan shall remain in effect, subject to
the right of the Board to amend or terminate the Plan at any time, until all
shares subject to it shall have been purchased or acquired according to the
Plan's provisions.
Awards under the Plan will vary each year based on the achievement of
annual performance objectives that directly correlate with the annual
performance objectives as defined by the Unitil Management Incentive Plan
("Incentive Plan"). Whereas the Incentive Plan provides cash incentive payments
that are tied directly to achievement of Unitil's strategic goals, the Plan
provides for awards for restricted shares of Common Stock that are tied directly
to achievement of Unitil's strategic goals. Annual performance objectives are
established each year by the Board. The percentage of the target award that a
Plan participant receives is also based upon subjective evaluations by the
Compensation Committee, such as management's performance in capitalizing on
unplanned opportunities and responding to unforeseen problems. Target grant
awards have been established that vary based upon the grade level of each
participant's position in the Unitil Companies. The actual number of shares of
Common Stock received under awards can be less than or greater than the target
grant depending upon actual results achieved.
Awards will fully vest over a period of four (4) years (the "Period of
Restriction") at a rate of 25% each year. During the Period of Restriction, the
Plan provides that the restricted shares underlying the award may not be sold,
transferred, pledged, assigned or otherwise alienated or hypothecated by the
recipient and no share certificates are issued. Prior to the end of the Period
of Restriction, the award of restricted shares shall be subject to forfeiture if
the participant ceases to be employed by the Unitil Companies other than due to
the participant's death. Awards may be subject to such additional restrictions
as the Compensation Committee may determine to be appropriate and as are set
forth in the particular Award Agreement. Subject to restrictions under
applicable law or as may be imposed by the Unitil Compensation Committee,
restricted shares underlying each award made under the Plan shall become freely
transferable by the Plan participant after the last day of the applicable Period
of Restriction.
During the Period of Restriction, cash dividends paid on restricted shares
underlying granted awards may be credited to the recipient's account. In the
event any non-cash dividends or other distributions, whether in property, or in
stock of another company, are paid on any restricted shares during the Period of
Restriction, such non-cash dividends or other distributions shall be retained by
Unitil until such time as the Period of Restriction has lapsed. In the event of
forfeiture of the restricted shares, such non-cash dividend or other
distributions shall be retained by Unitil.
Awards may be grossed-up to offset the participant's tax obligation in
connection with the award. This gross-up feature was intended to prevent a
participant from having to sell a portion of the shares granted in the award or
previous awards in order to pay the taxes on the award, which would be a direct
contradiction to one of the stated objectives of the Plan, which is
2
to encourage stock ownership in Unitil. The Compensation Committee will take
into account the value of the gross-up feature and reduce the size of the awards
accordingly.
Upon the occurrence of a Change in Control (as defined in the Plan), unless
otherwise specifically prohibited under applicable laws, or by the rules and
regulations of any governing governmental agencies or national securities
exchanges, any restrictions and transfer limitations imposed on restricted
shares shall immediately lapse.
The Board may at any time amend or terminate the Plan or any award granted
under the Plan in whole or in part, that no amendment that requires shareholder
approval in order for the Plan to continue to comply with any applicable tax or
securities laws or regulations, or the rules of any securities exchange on which
the securities of Unitil are listed, shall be effective unless such amendment
shall be approved by the requisite vote of shareholders of Unitil and that no
such amendment or termination shall adversely affect any award previously
granted under the Plan without the consent of the participant.
Unitil is authorized under its articles of incorporation to issue 8,000,000
shares of common stock, and as of December 31, 2003, 5,500,610 shares of common
stock were issued and outstanding./2 Unitil will file a registration statement
on Form S-8 (the "Registration Statement") with the Commission in order to
register this proposed offering under the Securities Act of 1933, as amended
(the "Securities Act"), which registration statement will become effective upon
filing in accordance with the rules promulgated by the Commission under the
Securities Act.
At December 31, 2003, Unitil's audited consolidated capitalization ratio
was approximately as follows: (in $1,000)
Long-Term Debt $114,224 49.1%
Short-Term Debt 22,410 9.6
Preferred Stock 3,269 1.4
Common Stock 92,805 39.9
-------- ------
Total $232,708 100.0%
======== ======
Assuming that all of the shares of Common Stock reserved for issuance under
the Plan are issued and vested under the Plan, Unitil's consolidated
capitalization ratios would have been approximately as follows: (in $1,000)
Long-Term Debt $114,224 49.1%
Short-Term Debt 22,410 9.6
Preferred Stock 3,269 1.4
Common Stock 92,805 39.9
-------- ------
Total $232,708 100.0%
======== ======
--------
2 For purposes of its GAAP balance sheet, Unitil has treated the shares
underlying outstanding award agreements as outstanding.
3
Unitil is requesting that the Commission approve the issuance of restricted
stock under the Plan in accordance with its terms.
The proposed transactions may be subject to Rules 53 and 54 under the Act.
Neither Unitil nor any subsidiary thereof presently has, or as a consequence of
the proposed transactions will have, an interest in any EWG or FUCO. None of the
proceeds from the proposed transactions will be used to acquire any securities
of, or any interest in, an EWG or FUCO. Consequently, all applicable
requirements of Rule 53(a)-(c) under the Act are satisfied as required by Rule
54 under the Act.
ITEM 2. FEES, COMMISSIONS AND EXPENSES
The fees, commissions and expenses of the Applicant expected to be paid or
incurred, directly or indirectly, in connection with the transactions described
above are estimated as follows:
Filing and Listing Fees ......................... $ 4,150
Legal fees....................................... 28,000
Accounting Fees.................................. 3,000
Transfer Agent & Registrar Fees.................. 0
Printing Fees.................................... 0
Miscellaneous.................................... 2,000
Total...................................... $37,150
ITEM 3. APPLICABLE STATUTORY PROVISIONS
Sections 6(a) and 7 of the Act are directly applicable to this
Application-Declaration.
ITEM 4. REGULATORY APPROVALS
No state or federal agency other than the Commission has jurisdiction with
respect to any of the transactions for which authorization is sought hereby
other than as described in this item. In order for the shares of Common Stock to
be freely tradable once the relevant Restricted Period ends, the Registration
Statement must be effective under the Securities Act, which will happen
automatically upon the filing thereof.
ITEM 5. PROCEDURE
On March 4, 2004, the Commission issued and published the requisite notice
under Rule 23 with respect to this Application-Declaration; such notice
specifying a date not later than March 29, 2004 as the date after which an order
granting and permitting this Application-Declaration to become effective may be
entered by the Commission. The Applicant is unaware of any comments having been
time filed with respect to this Application-Declaration and
4
requests that the Commission's order with respect to this Application-
Declaration be issued as soon as practicable.
No recommended decision by a hearing officer or other responsible officer
of the Commission is necessary or required in this matter. The Division of
Investment Management of the Commission may assist in the preparation of the
Commission's decision in this matter. There should be no thirty-day waiting
period between the issuance and effective date of any order issued by the
Commission in this matter, and it is respectfully requested that any such order
be made effective immediately upon the entry thereof.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS
(a) Exhibits
Exhibit No. Description of Exhibit
----------- ----------------------
A-1 Articles of Incorporation of Unitil (Filed as
exhibit 3.1 to the 1992 Form S-14 Registration
Statement of Unitil, File No. 2-93769, and
incorporated by reference herein).
A-2 Articles of Amendment to Articles of Incorporation
(Filed as exhibit 3.2 to the 1992 Form S-14
Registration Statement of Unitil, File No. 2-93769,
and incorporated by reference herein).
A-3 By-laws of Unitil (Filed as exhibit 3.2 to the 1992
Form 10-K of Unitil and incorporated by reference
herein).
B-1 Unitil Corporation 2003 Restricted Stock Plan
(previously filed)
B-2 Registration Statement on Form S-8 under the
Securities Act relating to the Additional Common
Stock (To be filed with the Commission under the
Securities Act and incorporated by reference
herein).
F-1 Opinion of Counsel.
F-2 "Past Tense" Opinion of Counsel (To be filed by
Amendment).
G-1 Proposed Form of Notice (previously filed).
5
(b) Financial Statements
No. Description of Financial Statement
--- ----------------------------------
FS-1 Unitil Corporation Consolidated Actual Balance
Sheet and Statement of Earnings, December 31, 2003
(Filed with the Commission with Unitil's Form 10-K
for the year ended December 31, 2003 and
incorporated by reference herein).
FS-2 Unitil Corporation Consolidated Pro Forma Balance
Sheet and Statement of Earnings as of December 31,
2003 (previously filed).
ITEM 7. INFORMATION AS TO ENVIRONMENTAL EFFECTS
None of the matters that are the subject of this Application-Declaration
involve a "major federal action" nor do they "significantly affect the quality
of the human environment" as those terms are used in Section 102(2)(C) of the
National Environmental Policy Act. None of the proposed transactions that are
the subject of this Application-Declaration will result in changes in the
operation of the Applicant that will have an impact on the environment. The
Applicant are not aware of any federal agency which has prepared or is preparing
an environmental impact statement with respect to the transactions proposed
herein.
6
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the Applicant has duly caused this Pre-effective Amendment No. 1 to its
Application-Declaration to be signed on its behalf by the undersigned thereunto
duly authorized.
Dated: April 1, 2004
UNITIL CORPORATION
By: /s/ Mark H. Collin
---------------------------------------
Name: Mark H. Collin
Title: Senior Vice President, Chief Financial
Officer & Treasurer
7