(As filed May 30, 2002)
File No. 70-9645
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POS-AMC
(Post-Effective Amendment No. 5)
to
FORM U-1
APPLICATION/DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
EXELON CORPORATION
COMMONWEALTH EDISON COMPANY
10 South Dearborn Street
37th Floor
Chicago, Illinois 60603
PECO ENERGY COMPANY
2301 Market Street
Philadelphia, Pennsylvania 19101
EXELON GENERATION COMPANY, LLC
300 Exelon Way
Kennett Square, Pennsylvania 19348
INFRASOURCE, INC.
200 Yale Avenue
Morton, Pennsylvania 19070
EXELON SERVICES INC.
2315 Enterprise Drive
Westchester, Illinois 60154
(Names of companies filing this statement and addresses
of principal executive offices)
--------------------------------------------------------
EXELON CORPORATION
(Name of top registered holding company parent of applicants)
-------------------------------------------------------
Randall E. Mehrberg
Executive Vice President and General Counsel
Exelon Corporation
10 South Dearborn Street
37th Floor
Chicago, Illinois 60603
(Name and address of agent for service)
------------------------------------------------------
The Commission is requested to send copies of all notices, orders and
communications in connection with this Application/Declaration to:
Harvey B. Dikter
Senior Vice President and General Counsel
InfraSource, Inc.
200 Yale Avenue
Morton, Pennsylvania 19070
Constance W. Reinhard
Assistant General Counsel
Exelon Business Services Company
10 South Dearborn Street
35th Floor
Chicago, IL 60603
(312) 394-3604
constance.reinhard@exeloncorp.com
---------------------------------
William T. Baker, Jr., Esq.
Thelen Reid & Priest LLP
40 West 57th Street
New York, New York 10019
Post-Effective Amendment No. 1, filed in this proceeding on April 4,
2001, as amended by Post-Effective Amendments Nos. 3 and 4,1 is hereby further
amended as follows:
1. By replacing the paragraph added by Post Effective Amendment
No. 3 with the following paragraph at the end of Item 1.3:
"As indicated, under the Merger Order, the Commission granted an
interim exemption under Section 13(b) of the Act from the at-cost standards of
Rules 90 and 91 with respect to certain types of services rendered to and by the
Utility Subsidiaries, including the infrastructure services provided by
InfraSource, Inc.2 and mechanical contracting services provided by ES, as
described above. The Merger Order specifies that, as of January 1, 2002, all
these transactions will be performed at cost in accordance with Rules 90 and 91.
By supplemental order dated December 20, 2001 in this proceeding (Holding Co.
Act Release No. 27480)(the "Supplemental Order") the Commission extended the
interim exemption granted under the Merger Order from December 31, 2001 until
June 30, 2002. It is now requested that, pending a decision in this proceeding,
the Commission issue a second supplemental order extending the interim exemption
granted under the Merger Order and extended by the Supplemental Order from June
30, 2002 until February 28, 2003. The eight-month extension will afford the
Commission the additional time needed for it to fully consider the policy
implications raised by applicants and, if determined to be appropriate,
formulate new policies in ruling on exemption requests under Section 13(b),
without disrupting existing contractual relationships among the Utility
Subsidiaries and their affiliates, all of which are currently in compliance with
applicable affiliate transaction rules adopted by the Pennsylvania and Illinois
Commissions. The eight-month extension will also give the Commission two months
beyond year-end, traditionally its busiest time, to act. It is requested that
the Commission issue a second supplemental order extending the interim exemption
as soon as practical and in any event not later than June 30, 2002, so that the
status of any existing affiliate agreements is not called into question."
2. By amending and restating Item 2 to read as follows:
"The incremental fees, commissions and expenses incurred or to be
incurred (1) in connection with Post-Effective Amendment No. 1 are estimated at
not more than $10,000 and (2) in connection with Post-Effective Amendments
Nos. 3, 4 and 5 are estimated at not more than $5,000 each."
3. By amending and restating Item 3.3 to read as follows:
-------------------
1 Post-Effective Amendment No. 2, which was filed on October 1, 2001,
relates to matters that are not the subject of Post Effective Amendment No. 1.
Post-Effective Amendment No. 3, which was filed on December 14, 2001, requested
a supplemental order extending the interim exemption granted under the Merger
Order from December 31, 2001 until June 30, 2002. Post-Effective Amendment
No. 4, which was filed on December 20, 2001, corrected a typographical error in
Post-Effective Amendment No. 3.
2 Since the date of the Supplemental Order referred to in this paragraph,
EIS has changed its name to "InfraSource Inc."
"Rule 54. The proposed transaction is also subject to the requirements
of Rule 54. Rule 54 provides that in determining whether to approve the issue or
sale of a security by a registered holding company for purposes other than the
acquisition of an "exempt wholesale generator" ("EWG") or a "foreign utility
company" ("FUCO"), or other transactions by such registered holding company or
its subsidiaries other than with respect to EWGs or FUCOs, the Commission shall
not consider the effect of the capitalization or earnings of any subsidiary
which is an EWG or a FUCO upon the registered holding company if paragraphs (a),
(b) and (c) of Rule 53 are satisfied.
Exelon currently does not meet all of the conditions of Rule 53(a). As
of March 31, 2002, Exelon's "aggregate investment," as defined in Rule 53(a)(1),
in EWGs and FUCOs was approximately $1,353 million which is in excess of the 50%
of Exelon's average consolidated retained earnings of $1,006 million at March
31, 2002 which is the "safe harbor" limitation contained in Rule 53(a). However,
by orders dated November 2, 2000 and December 8, 2000 (HCAR Nos. 27266 and
27296, together the "Financing Orders"), the Commission has authorized Exelon to
increase its "aggregate investment" in EWGs and FUCOs to an amount of up to $4
billion. Therefore, although Exelon's "aggregate investment" in EWGs and FUCOs
currently exceeds the 50% "safe harbor" limitation, this investment level is
permitted under the Financing Orders.
In any event, even taking into account the capitalization of and
earnings from EWGs and FUCOs in which Exelon has an interest, there would be no
basis for withholding approval of the proposed transaction. With regard to
capitalization, since the issuance of the Financing Orders, there has been no
material adverse impact on Exelon's consolidated capitalization resulting from
Exelon's investments in EWGs and FUCOs. At March 31, 2002, Exelon's consolidated
capitalization consists of 34% equity, 3% preferred securities, 61% long-term
debt (including current maturities of long-term debt), and 2% short-term debt.
These ratios are within acceptable industry ranges. The proposed transaction
will not have any material impact on capitalization. Further, since the date of
the Financing Orders, there has been no material change in Exelon's level of
earnings from EWGs and FUCOs.
Exelon satisfies all of the other conditions of paragraphs (a) and (b)
of Rule 53. With reference to Rule 53(a)(2), Exelon maintains books and records
in conformity with, and otherwise adheres to, the requirements thereof. With
reference to Rule 53(a)(3), no more than 2% of the employees of Exelon's
domestic public utility companies render services, at any one time, directly or
indirectly, to EWGs or FUCOs in which Exelon directly or indirectly holds an
interest. With reference to Rule 53(a)(4), Exelon will continue to provide a
copy of each application and certificate relating to EWGs and FUCOs and relevant
portions of its Form U5S to each regulator referred to therein, and will
otherwise comply with the requirements thereof concerning the furnishing of
information. With reference to Rule 53(b), none of the circumstances enumerated
in subparagraphs (1), (2) and (3) thereunder have occurred. Finally, Rule 53(c)
by its terms is inapplicable since the proposed transaction does not involve the
issue or sale of a security to finance the acquisition of an EWG or FUCO."
2
SIGNATURES
----------
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned companies have duly caused this statement to be signed
on their behalves by the undersigned thereunto duly authorized.
EXELON CORPORATION
By: /s/ Randall Mehrberg
----------------
Name: Randall Mehrberg
Title: Executive Vice President
and General Counsel
INFRASOURCE, INC.
By: /s/ Harvey B. Dikter
----------------
Name: Harvey B. Dikter
Title: Senior Vice President
and General Counsel
EXELON SERVICES INC.
By: /s/ John Caraher
------------
Name: John Caraher
Title: Vice President-Finance
COMMONWEALTH EDISON COMPANY
PECO ENERGY COMPANY
EXELON ENERGY GENERATION COMPANY,LLC
BY EXELON CORPORATION
By: /s/ Randall Mehrberg
----------------
Name: Randall Mehrberg
Title: Executive Vice President
and General Counsel
Date: May 30, 2002