Pendleton Manufacturing Co., Subsidiary, Debtor_-_ SECTION 11 OF THE PUBLIC UTILITY HOLDING COMPANY Mountain States Power Co.......... ACT OF 1935 National Public Utilities Corp. (William W. Battles, Chairman, Francis 5 S. E. C. 72 917 917 442 590 OF THE SECURITIES AND EXCHANGE COMMISSION [No. 757] IN THE MATTER OF MOUNTAIN STATES POWER COMPANY File Nos. 52-7, 52-8. Promulgated June 2, 1939 SIMPLIFICATION OF HOLDING COMPANY SYSTEM. Reorganization Plan Under Section 77B of Bankruptcy Act. Plan of reorganization for a subsidiary of a registered holding company, submitted for approval under Section 11 (f) of the Public Utility Holding Company Act of 1935 by a committee representing bondholders of the subsidiary in an application under Rule U-11F-1, and a similar application filed by the subsidiary company and a committee representing preferred stockholders of the subsidiary company for approval of an identical plan, approved, subject to certain conditions. Provision of plan of reorganization permitting new bonds to be issued to be called in their entirety at 101 and accrued interest within 12 months after the expiration of the period for appeal from an order of the court confirming the plan, or until January 1, 1941, whichever is earlier, and thereafter at premiums starting at 105, found to be fair and equitable to the bondholders and junior security holders of the debtor. Where valuation of property of subsidiary company, in reorganization proceedings, indicated that the common stock was without equity, but plan provided that 1.08 percent of new common stock should be distributed to the old common stockholders exclusive of holding company, held that this percentage is so small as not to constitute an unfair infringement on such contract rights and priorities as the holding company and preferred stockholders may have. Where subsidiary company, undergoing reorganization, was indebted to its registered holding company on an open account, the treatment of which in the reorganization was in dispute, and where, pursuant to a compromise, the claim on the open account of the holding company was in part subordinated to the claim of the preferred stock on the basis of the decision in Taylor v. Standard Gas and Electric Company, 306 U. S. 307, the Commission, after considering the respective contentions, found that the proposed compromise was not an unreasonable disposition of the controverted issues. ISSUE AND SALE OF SECURITIES OF REGISTERED HOLDING COMPANY OR SUBSIDIARY. Reorganization. Declaration, filed by subsidiary of registered holding company, pursuant to Section 7 of the Act, regarding the issue and sale of 5% first mortgage bonds, 5% cumulative preferred stock with a par value of $50 per share, and of common stock without par value, ordered effective subject to certain conditions, the Commission finding that the new securities are to be issued for the purpose of effecting a reorganization and satisfy Section 7 (c) (2) of the Act. |