998 The of whi are hel were 50 to 499 sł not been through I The avera of the stock listing, to a The appli is sparse, va even an appr stated that th holders appro quired under retained before agent in the eve any changes in: attitude toward tioned changes i Exchange Act re tions of proxies. expense, if any, w It appears plain was initially mad holder of 26,000 si posing withdrawal on the exchange ma ings. It was his be exchange, over-thesion permitted to b ity in the stock, wid admitted that the e. in his desire to have tration. No hint of this rea notices sent out by the We stated in In th "My thought is that I ca do the work." ין A public hearing on said declaration, as amended, was held after appropriate notice. Having examined the record in this matter, the Commission now makes the findings contained herein: DESCRIPTION OF DECLARANT Public Service Company of Oklahoma (sometimes hereinafter referred to as "Public Service" or "declarant") is an Oklahoma corporation whose business as a public utility company is the production, purchase, transmission, distribution and sale of electric energy and natural gas, and pumping, storing and distributing water in astern Oklahoma, including the city of Tulsa. For the 12 months nded November 30, 1939, 98.06 percent of gross operating revenues f $6,718,526 was derived from the sale of electric energy and the lance from gas and water sales. Declarant's principal subsidiary is Southwestern Light & Power mpany, an electric and gas utility company which serves an area southwestern Oklahoma.2 Interest and dividends received from t company during the aforesaid period amounted to $74,323. THE PROPOSED ISSUANCE he serial notes are to be issued in the aggregate amount of 0,000 and will mature $100,000 on August 1, 1941, and in like ints every 6 months thereafter to and including February 1, The notes maturing on August 1, 1941, and February 1, 1942, Dear interest at the rate of 14% and the remaining notes at the f 234%. Upon 30 days' notice declarant may prepay the notes !l, or partially in multiples of $50,000, upon payment of a im of one-fourth of 1% of the amount of any such prepayAt least half of any partial prepayments must be applied to ment of the last maturing notes then outstanding. e banks will purchase the notes at par in the following S: Bank of Tulsa, (Tulsa, Okla.) tional Bank and Trust Company (Tulsa, Okla.)-- $350,000 350,000 300, 000 1,000,000 reement with the banks provides that without the consent ders of the notes declarant shall not incur any indebtedness ) additional bonds as permitted by the mortgage indenture, tedness incurred in the usual course of business maturing han 12 months after incurred, (3) indebtedness secured by Lending before the Commission an application of declarant for exemption mpany pursuant to Section 3 (a) (2) of the Act (File No. 31-204). Declarant wo small nonutility subsidiaries. [No. 995] IN THE MATTER OF PUBLIC SERVICE COMPANY OF OKLAHOMA File No. 43-287. Promulgated March 7, 1940 ISSUE AND SALE OF SECURITIES OF REGISTERED HOLDING COMPANY OR SUBSIDIARY. Refunding. Declaration filed by an indirect subsidiary of a registered holding company, pursuant to Section 7 of the Public Utility Holding Company Act of 1935, regarding the issue and sale to three banks of $1,000,000 principal amount of 1%-2% unsecured serial notes, the proceeds from such sale to be applied together with other funds to the redemption of a like amount of 4% serial debentures, permitted to become effective, subject to certain conditions, the Commission finding that since the proceeds of the notes are to be used to refund outstanding securities of the declarant, and for the purpose of financing the business of the company as a public utility company, the proposed issuance complies with Sections 7 (c) (2) (A) and (B) of the Act, the Commission observing no basis for making adverse findings in respect of matters specified in Section 7 (d). APPEARANCES: W. A. Osterling and M. C. Sheehy, of the Public Utilities Division of the Commission. FINDINGS AND OPINION OF THE COMMISSION Public Service Company of Oklahoma, an indirect subsidiary of The Middle West Corporation, a registered holding company, has filed a declaration pursuant to Section 7 of the Public Utility Holding Company Act of 1935 regarding the issue and sale to three banks of $1,000,000 principal amount of 134%-234% unsecured serial notes due semiannually August 1, 1941 to February 1, 1946. The proceeds of such sale are to be applied, together with other funds of the company to the extent required, to the redemption of $1,000,000 principal amount of 4% serial debentures presently outstanding and due serially February 1, 1942 to February 1, 1946. 1 The Middle West Corporation, through its registered subholding company subsidiaries, Central and South West Utilities Company and American Public Service Company, controls a total of 54.5 percent of outstanding voting stock of Public Service Company of Oklahoma. A public hearing on said declaration, as amended, was held after appropriate notice. Having examined the record in this matter, the Commission now makes the findings contained herein: DESCRIPTION OF DECLARANT Public Service Company of Oklahoma (sometimes hereinafter referred to as "Public Service" or "declarant") is an Oklahoma corporation whose business as a public utility company is the production, purchase, transmission, distribution and sale of electric energy and natural gas, and pumping, storing and distributing water in eastern Oklahoma, including the city of Tulsa. For the 12 months ended November 30, 1939, 98.06 percent of gross operating revenues of $6,718,526 was derived from the sale of electric energy and the balance from gas and water sales. Declarant's principal subsidiary is Southwestern Light & Power Company, an electric and gas utility company which serves an area in southwestern Oklahoma.2 Interest and dividends received from that company during the aforesaid period amounted to $74,323. THE PROPOSED ISSUANCE The serial notes are to be issued in the aggregate amount of $1,000,000 and will mature $100,000 on August 1, 1941, and in like amounts every 6 months thereafter to and including February 1, 1946. The notes maturing on August 1, 1941, and February 1, 1942, will bear interest at the rate of 14% and the remaining notes at the rate of 24%. Upon 30 days' notice declarant may prepay the notes in full, or partially in multiples of $50,000, upon payment of a premium of one-fourth of 1% of the amount of any such prepayment. At least half of any partial prepayments must be applied to the payment of the last maturing notes then outstanding. Three banks will purchase the notes at par in the following amounts: National Bank of Tulsa, (Tulsa, Okla.) - First National Bank and Trust Company (Tulsa, Okla.). $350,000 350,000 300, 000 1, 000, 000 The agreement with the banks provides that without the consent of the holders of the notes declarant shall not incur any indebtedness except (1) additional bonds as permitted by the mortgage indenture, (2) indebtedness incurred in the usual course of business maturing not later than 12 months after incurred, (3) indebtedness secured by There is pending before the Commission an application of declarant for exemption as a holding company pursuant to Section 3 (a) (2) of the Act (File No. 31-204). Declarant also controls two small nonutility subsidiaries. a lien on property hereafter acquired, (4) obligations in connection with the purchase of materials and equipment in the ordinary course of business, and (5) customers' deposits. The agreement also provides that the declarant shall not sell all or substantially all of its property and assets. USE OF PROCEEDS The proceeds of $1,000,000 from sale of the notes, together with $21,000 of treasury funds, are to be used to redeem $1,000,000 principal amount of declarant's 4% serial debentures having maturities of $200,000 on February 1 of each of the years 1942 to 1946, inclusive, requiring $1,021,000 for principal and premiums.3 The debentures thus to be retired were originally issued in 1936 in an aggregate amount of $2,000,000, of which there is a total of $1,200,000 presently outstanding. As required by the agreement with the banks, concurrently with the issuance of the proposed notes declarant will deposit irrevocably in trust with the trustee of said debentures a sum of money sufficient for the payment of the principal of the $200,000 of debentures maturing on February 1, 1941, and for the payment of interest thereon to maturity." SECURITY STRUCTURE As of November 30, 1939, the capitalization and surplus of Public Service, both before and after the proposed financing, is represented in the following schedule: • $200,000 principal amount of debentures due February 1, 1940, were paid on that date; and concurrently with the proposed issuance of notes, cash sufficient to pay $200,000 of debentures due February 1, 1941, and 4% interest thereon to maturity, will be deposited with the trustee of the debentures. * Redemption premium on the debentures maturing in 1942 is 4%; in 1943, 3%; 1944, 2% ; 1945, 1%; and 1946, one-half of 1%. See In the matter of Public Service Company of Oklahoma, 1 S. E. C. 297 (1936). The debentures maturing February 1, 1941, may be redeeemed only upon payment of a premium of 5%. |