[Vol. 15] Public Service Commission, Second District In the Matter of the Joint Petition of NIAGARA, LOCKPORT AND ONTARIO POWER COMPANY and SALMON RIVER POWER COMPANY, under Section 69 of Public Service Commissions Law, as to the Niagara Company Issuing $1,482,128 in Notes or Debentures and as to the Salmon River Company Issuing $546,000 in Refunding Notes; under Section 70, Public Service Commissions Law, as to Niagara Company Acquiring Capital Stock, Said Refunding Notes and Other Notes of Salmon River Company Case No. 6007 (Public Service Commission, Second District, January 29, 1918) Acquisition by a power company of the capital stock, certain refunding notes and other notes of a similar company. The original petition herein was filed April 25, 1917, and was amended under date of October thirteenth of that year, and on January 15, 1918, a second amendatory petition was filed. The petition as amended sought authority for the Niagara, Lockport and Ontar: Power Company, after it had merged the Salmon River Power Company, to execute and deliver to the Equitable Trust Company of New York, as trustee, a certain deed of trust upon all its plant and property to secure an issue of refunding mortgage sinking fund gold bonds to the aggregate amount of $15,000,000, to be issued as set forth in the petition, and that under the deed of trust above mentioned it be authorized to issue $1,980,000 face value of bonds to be secured by the mortgage or said deed of trust, to be designated as series A and to bear interest at the rate of 6 per cent per annum. Application granted. Petition filed April 25, 1917. First amendatory petition filed October 13, 1917. Report of division of capitalization dated October 17, 1917. Second amendatory petition filed January 15, 1918. Report of division of capitalization dated January 23, 1918. Hearing held January 24, 1918. BY THE COMMISSION.- Now, therefore, upon the foregoing record, ordered as follows: Public Service Commission, Second District [Vol. 15] 1. That the Niagara, Lockport and Ontario Power Company, after it has merged the Salmon River Power Company, be and it is hereby authorized to execute and deliver to the Equitable Trust Company of New York, as trustee, a corporation organized and existing under the laws of the State of New York, a certain indenture, deed of trust or mortgage upon all its plant and property, to be dated the 31st day of January, 1918, to secure an issue of refunding mortgage sinking fund gold bonds to the aggregate amount of $15,000,000, which bonds are issuable in series, to bear interest at a rate not exceeding 6 per cent per annum, and to mature not later than February 1, 1958, a copy of which indenture has been filed with the Commission herein, and that the form thereof so filed is hereby approved. 2. That upon the execution and the delivery of said indenture so authorized, which shall not be more than fifteen days from the date hereof, there shall be filed with this Commission a copy thereof in the form in which it was executed and delivered together with an affidavit by the president or other executive officer of the company stating that the indenture as executed and delivered is the same as that herein approved by the Commission. 3. That the Niagara, Lockport and Ontario Power Company be and it is hereby authorized to issue $1,980,000 face value of bonds to be secured by the mortgage hereinbefore referred to, which bonds shall be designated as series A and shall bear interest at the rate of 6 per cent per annum. 4. That said bonds of the total face value of $1,980,000 may be sold for not less than 90 per cent of their face value to realize net proceeds of at least $1,782,000. 5. That the proceeds of said bonds so authorized, which shall be not less than $1,782,000, shall be used solely and exclusively for the following purposes:" a. To pay off and discharge three-year 6 per cent gold notes of the Salmon River Power Company which mature on February 1, 1918... $546,000 00 [Vol. 15] Public Service Commission, Second District b. To be applied toward the cost of extensions, additions and improvements of the steam generating plant of the petitioner at Lyons, N. Y., as detailed in Exhibit A attached to the petition in case 6196 filed on September 12, 1917...... $761,105 60 Less amount provided for by order in that proceeding dated September 18, 1917..... 364,000 00 c. To be applied toward the payment of the petitioner's debt and the debt of the merged corporation outstanding at December 31, 1916, and [or] to the reimbursement of its treasury for expenditures from income for the acquisition of fixed assets since April 30, 1912, not obtained from the issue of stock, bonds, notes or other evidence of indebtedness of such corporation... $397,105 60 838,894 40 $1,782,000 00 in so far as the same may be applicable provided: 1. That the proceeds of such bonds shall be applied toward the cost of new construction summarized in subdivision (b) hereof only in so far as such new construction is a real increase in the fixed capital of the petitioner as defined by the uniform system of accounts for electrical corporations adopted by this Commission. 2. That there shall be no charges to fixed capital on account of engineering services in connection with such construction unless such engineering services shall have been rendered either by other than the regular officers and employees of the corporation, or, in a proper case, where such services may have been rendered by cer Public Service Commission, Second District [Vol. 15] tain of such officers or employees under an express assignment to such construction or improvement work. 3. That the unit prices contained in Exhibit A of the petition in case 6196 referred to in subdivision (b) hereof are not intended to be and must not be construed by the petitioner as having been. determined upon by the Commission as the actual cost of the property and work to be acquired and done and thus properly chargeable to fixed capital, but are intended and shall be construed only to be a present estimate of the probable cost of such property and work, the actual cost of which must be actual expenditures made as defined by the Commission's uniform system of accounts for electrical corporations. 6. That the Niagara, Lockport and Ontario Power Company is hereby authorized to execute and deliver a trust agreement, to be dated the 31st day of January, 1918, with the Erie Construction Company, and the Equitable Trust Company of New York, as trustee, to secure an issue of two-year secured 6 per cent convertible gold notes, a copy of which agreement has been filed with the Commission herein, and that the form thereof so filed is hereby approved. 7. That upon the execution and the delivery of said agreement so authorized, which shall not be more than fifteen days from the date hereof, there shall be filed with this Commission a copy hereof in the form in which it was executed and delivered together with an affidavit by the president or other executive officer of the company stating that the agreement as executed and delivered is the same as that herein approved by the Commission. 8. That the Niagara, Lockport and Ontario Power Company is hereby authorized to issue $1,300,000 face value of its two-year 6 per cent secured convertible gold notes under the aforesaid agreement. 9. That said notes of a total face value of $1,300,000 may be sold for not less than 922 per cent of their face value to realize net proceeds of at least $1,202,500, which proceeds shall be applied to the purposes for which the proceeds of the bonds herein authorized are to be used. Vol. 15] Public Service Commission, Second District 10. That the Niagara, Lockport and Ontario Power Company is hereby permitted to pledge the bonds of the aggregate face value of $1,980,000 herein authorized to be issued as collateral security for the aforesaid two-year six per cent secured convertible gold notes. 11. That the Niagara, Lockport and Ontario Power Company is hereby authorized to use such an amount of the $1,980,000 of bonds herein authorized to be issued at 90 per cent of their face value as may be necessary to effect the conversion into such bonds at the price aforesaid of the $1,300,000 face amount of notes herein authorized to be issued in accordance with the provisions of article 6 of the trust agreement herein approved as to form, provided that the face amount of bonds which may be so used shall not be greater than $1,445,000. 12. That the Niagara, Lockport and Ontario Power Company shall within thirty days from the date hereof and thereafter for each six months' period ending June thirtieth and December thirty-first file not more than thirty days from the end of such period a verified report which shall show: a. The dates of sales, pledgings and conversions of the securities herein authorized. b. To or with whom such transactions were had. c. The amount and character of the proceeds realized from such transactions. d. Any other terms and conditions of such transactions. e. With respect to subdivisions (a) and (c) of clause No. 5 of this order there shall be shown in detail the amount of security proceeds used therefor. f. With respect to subdivision (b) of clause No. 5 of this order there shall be shown: 1. In detail the amount expended of the proceeds of the bonds herein authorized, and the account or accounts under the uniform system of accounts for electrical corporations to which such expenditures have been charged, giving all details of any credits to fixed capital in connection with such expenditures. 2. A summary of the expenditures for each of the purposes set forth in said Exhibit A during the period covered by the report. |