SEC File No. 70-9793
And
SEC FILE NO. 70-9941
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
CERTIFICATE PURSUANT TO
RULE 24
OF PARTIAL COMPLETION OF
TRANSACTIONS
FirstEnergy Corp.
------------------------------------:
In the matter of :
FirstEnergy Corp. : Certificate Pursuant
: to Rule 24 of Partial
: Completion of
: Transactions
SEC File No. 70-9793 :
SEC File No. 70-9941 :
(Public Utility Holding Company Act :
of 1935) :
------------------------------------
TO THE MEMBERS OF THE SECURITIES AND EXCHANGE COMMISSION:
The undersigned, FirstEnergy Corp (FirstEnergy) hereby certifies pursuant
to Rule 24 of the Rules and Regulations under the Public Utility Holding Company
Act of 1935 (the Act), that certain of the transactions proposed in the
Applications, as amended, filed in SEC File No. 70-9793 and SEC File No.
70-9941, respectively, have been carried out in accordance with the Commission's
Orders dated with respect to the said Applications as follows:
1. During the period July 1, 2002 through September 30, 2002, there were no
sales of common stock or Preferred Securities by FirstEnergy.
2. FirstEnergy issued 414,511 shares of common stock pursuant to options granted
under employee benefit plans and dividend reinvestment plans during the third
quarter of 2002.
3. During the period July 1, 2002 through September 30, 2002, no FirstEnergy
common stock was transferred to a seller of securities of a company being
acquired.
4. During the third quarter of 2002, the following guarantees were made by
FirstEnergy to support activities of its subsidiaries, FirstEnergy Solutions
Corp. (FES), FirstEnergy Facilities Services Group, LLC (FEFSG) and FirstEnergy
Generation Corp. (FGCO):
Purpose of
Beneficiary Amount Terms Guarantee
----------- ------ ----- ---------
FES (Trading - Electric)
------------------------
Alliance Energy Services 1,000,000 (a) (b)
Cargil Alliant 2,000,000 (a) (b)
Cleveland Public Power 1,000,000 (a) (b)
Connective Energy Supply 10,000,000 (a) (b)
Duke Energy Trading 10,000,000 (a) (b)
PJM Interconnection 70,000,000 (a) (b)
Tractebel Energy Marketing 4,000,000 (a) (b)
TransAlta Energy Marketing 2,000,000 (a) (b)
FES (Trading - Gas)
-------------------
Duke Energy Trading 5,000,000 (a) (b)
Woodward Marketing 1,000,000 (a) (b)
FGCO (Fuel Marketing/Coal)
--------------------------
Cincinnati Gas & Electric 2,700,000 (a) (c)
DTE Coal Services 4,000,000 (a) (c)
1
FEFSG - HVAC
------------
Edwards (Fifth Third) 6,000,000 1 Year (d)
FGCO - (GE Capital) 2,842,000 1 Year (e)
(a) Such guarantees are issued for a one-year term, with a ten-day
termination right by FirstEnergy
(b) Parental guarantees issued by FirstEnergy to provide credit support for
electric power and natural gas purchases by subsidiary
(c) Credit backstop to support coal and emission trading
(d) Credit backstop to revolving credit agreement
(e) Credit backstop for software installation
The following Letters of Credits (LOC) were issued during the third quarter of
2002:
Purpose of
Beneficiary Amount LOC
----------- ------ -----------
FEFSG
-----
Old Republic Insurance Company $11,653,434 (a)
(a) Collateral for insurance program
5. During the period July 1, 2002 through September 30, 2002, the FirstEnergy
Companies issued the following indebtedness:
Transaction Maturity Transaction
Date Date Rate Amount Loan Balance
----------- -------- ---- -------------- --------------
CitiBank (FE Revolver)
---------------------
FirstEnergy Holding 6/20/2002 7/5/2002 2.93 $130,000,000.00 $215,262,031.25
FirstEnergy Holding 6/21/2002 7/12/2002 2.93 $120,000,000.00 $120,204,750.00
FirstEnergy Holding 6/26/2002 7/17/2002 2.93 $50,000,000.00 $50,085,312.50
FirstEnergy Holding 6/28/2002 7/29/2002 2.93 $80,000,000.00 $80,201,500.00
FirstEnergy Holding 7/19/2002 7/29/2002 2.93 $230,000,000.00 $230,186,875.00
FirstEnergy Holding 7/24/2002 7/29/2002 2.93 $15,000,000.00 $65,026,406.25
FirstEnergy Holding 7/29/2002 8/12/2002 2.99 $260,000,000.00 $260,302,069.45
FirstEnergy Holding 8/15/2002 8/16/2002 4.93 $70,000,000.00 $70,009,445.21
FirstEnergy Holding 8/16/2002 8/23/2002 2.99 $350,000,000.00 $350,203,315.97
FirstEnergy Holding 8/29/2002 9/30/2002 2.99 $150,000,000.00 $150,398,333.33
FirstEnergy Holding 9/16/2002 10/7/2002 3.00 $270,000,000.00 $270,472,500.00
FirstEnergy Holding 9/20/2002 9/23/2002 4.93 $60,000,000.00 $60,024,287.67
FirstEnergy Holding 9/24/2002 10/15/2002 3.05 $260,000,000.00 $260,462,583.33
FirstEnergy Holding 9/25/2002 10/25/2002 2.94 $20,000,000.00 $190,465,104.17
FirstEnergy Holding 9/27/2002 10/4/2002 3.05 $120,000,000.00 $340,201,638.89
CitiBank (OE Revolver)
----------------------
Ohio Edison 7/1/2002 7/15/2002 2.60 $190,000,000.00 $190,192,111.11
Ohio Edison 7/22/2002 7/23/2002 4.88 $20,000,000.00 $20,002,671.23
Ohio Edison 8/1/2002 8/15/2002 2.54 $250,000,000.00 $250,246,701.39
Ohio Edison 9/3/2002 9/24/2002 2.60 $190,000,000.00 $190,288,166.67
Ohio Edison 9/6/2002 9/27/2002 2.54 $60,000,000.00 $60,088,812.50
FirstMerit (OE Bi-Lateral Facility)
-----------------------------------
Ohio Edison 7/5/2002 7/8/2002 2.44 $14,000,000.00 $14,002,843.75
Ohio Edison 7/19/2002 7/22/2002 2.44 $14,000,000.00 $14,002,843.75
Ohio Edison 7/25/2002 7/26/2002 2.50 $9,500,000.00 $9,500,659.72
Ohio Edison 7/30/2002 7/31/2002 2.50 $14,000,000.00 $14,000,972.22
Ohio Edison 8/2/2002 8/5/2002 2.44 $2,500,000.00 $14,002,843.75
Ohio Edison 8/15/2002 8/16/2002 2.63 $13,000,000.00 $13,000,947.92
Ohio Edison 8/19/2002 8/20/2002 2.50 $4,000,000.00 $4,000,277.78
Ohio Edison 9/11/2002 9/12/2002 2.50 $1,500,000.00 $1,500,104.17
Ohio Edison 9/13/2002 9/16/2002 2.50 $3,000,000.00 $3,000,625.00
Ohio Edison 9/16/2002 9/17/2002 2.63 $8,500,000.00 $11,500,838.54
Ohio Edison 9/20/2002 9/23/2002 2.44 $14,000,000.00 $14,002,843.75
2
KeyBank(Bi-Lateral Facility)
----------------------------
Ohio Edison 6/28/2002 7/1/2002 3.00 $8,000,000.00 $8,002,000.00
Ohio Edison 7/5/2002 7/8/2002 2.78 $9,000,000.00 $9,002,085.98
Ohio Edison 7/19/2002 7/22/2002 2.72 $20,000,000.00 $20,004,531.33
Ohio Edison 7/30/2002 7/31/2002 2.78 $16,000,000.00 $16,001,236.13
Ohio Edison 7/31/2002 8/1/2002 2.81 $4,000,000.00 $20,001,562.50
Ohio Edison 8/2/2002 8/5/2002 2.72 $11,500,000.00 $11,502,605.52
Ohio Edison 8/15/2002 8/16/2002 2.88 $20,000,000.00 $20,001,597.22
Ohio Edison 9/23/2002 9/24/2002 2.75 $19,000,000.00 $19,001,451.39
6. During the period July 1, 2002 through September 30, 2002, the following
short term debt was issued by the Utility Subsidiaries:
Transaction Maturity Transaction
Date Date Rate Amount Loan Balance
----------- -------- ---- -------------- --------------
ATSI-Intercompany Loan to:
--------------------------
Ohio Edison 8/30/2002 9/1/2002 2.04 $10,286,000.00 $43,638,268.91
JCP&L - Intercompany Loan to:
-----------------------------
Met Edison Co 8/20/2002 9/4/2002 2.04 $16,000,000.00 $16,013,625.33
Ohio Edison - Intercompany Loan to:
-----------------------------------
Cleveland Electric 7/31/2002 8/1/2002 2.06 $62,334,000.00 $171,194,972.14
Cleveland Electric 8/30/2002 9/1/2002 2.04 $140,830,000.00 $312,342,287.30
Toledo Edison 6/28/2002 7/1/2002 2.46 $34,995,000.00 $134,190,116.48
Toledo Edison 7/31/2002 8/1/2002 2.06 $11,601,000.00 $146,029,983.67
Toledo Edison 9/30/2002 10/1/2002 1.99 $18,000,000.00 $147,450,237.86
PennPower - Intercompany Loan to:
---------------------------------
Ohio Edison 6/28/2002 7/1/2002 2.46 $21,147,000.00 $37,368,889.44
Ohio Edison 7/31/2002 8/1/2002 2.06 $11,934,000.00 $49,369,906.85
Ohio Edison 8/30/2002 9/1/2002 2.04 $14,330,000.00 $63,788,431.19
7. During the third quarter of 2002, the following financing was consummated by
FirstEnergy Generation Corp. that was not exempt under rule 52:
Pennsylvania Economic Development Financing Authority
Exempt Facilities Revenue Bonds Series 2002 A
---------------------------------------------
Issued Date July 2, 2002
Maturity Date June 1, 2028
Amount $15,000,000
Interest Rate 5% for 3 years; reset after 3 years per documents
8. During the Third Quarter of 2002, FirstEnergy Corp. entered into three (3)
transactions designed to hedge the fair value of a portion of FirstEnergy
Corp.'s long-term debt portfolio. The hedge structures are fixed - for -
floating interest rate swaps, whereby FirstEnergy Corp. will receive fixed
payments equivalent to the fixed coupons of the bonds being hedged, and pay
floating rate payments based on the 6-month London Interbank Offering Rate
(LIBOR) plus an applicable spread. Two (2) of the three(3) hedges contain
written options which give the counterparty the right to cancel the transactions
at predetermined rates. FirstEnergy cancelled one (1) of the hedges on September
30, 2002, receiving a cash payment of $2,448,000, equivalent to the then-current
market value of the hedge, from the hedge counterparty on October 2, 2002. The
notional amounts, counterparties, and principal terms of the fair value hedges
are filed pursuant to request for confidential treatment.
3
9. Investments made during the third quarter 2002 in any intermediate subsidiary
or financing subsidiary are as follows:
Company Investment
------- ----------
(In Thousands $)
Bay Shore Power Company $11,100
10. During the third quarter of 2002 FirstEnergy filed the following U-6B-2
forms:
Company Filing Date
------- -------------
The Cleveland Electric Illuminating Company July 24, 2002
Pennsylvania Power Company July 12, 2002
11. The Cleveland Electric Illuminating Company (CEI) and Pennsylvania Power
Company (Penn) engaged in jurisdictional financing transactions during the third
quarter of 2002. Consolidated balance sheets of CEI and balance sheets for Penn
for the quarter ended September 30, 2002 - incorporated by reference to CEI's
and Penn's Form 10-Q Quarterly Report to SEC for the quarter ended September 30,
2002 (File No. 1-2323 and 1-3491, respectively).
12. The following table presented in thousands, provides the capital structure
of FirstEnergy on a consolidated basis and each Utility Subsidiary as of the end
of the third quarter 2002.
FirstEnergy Corp. Amount Ratio
----------------- ---------- ------
Common Equity $7,792,774 34.82%
Preferred Stock 782,945 3.50%
Long Term Debt 12,551,483 56.08%
Short Term Debt 1,253,413 5.60%
---------- ------
Total Capitalization $22,380,615 100.00%
---------- ------
Ohio Edison
-----------
Common Equity $2,852,455 53.50%
Preferred Stock 115,070 2.16%
Long Term Debt 1,796,372 33.69%
Short Term Debt 567,800 10.65%
--------- ------
Total Capitalization $5,331,697 100.00%
--------- ------
Cleveland Electric
------------------
Common Equity $1,286,331 31.17%
Preferred Stock 219,463 5.32%
Long-Term Debt 2,333,983 56.55%
Short-Term Debt 287,225 6.96%
--------- ------
Total Capitalization $4,127,002 100.00%
--------- ------
Toledo Edison
-------------
Common Equity $759,867 43.16%
Preferred Stock 126,000 7.16%
Long-Term Debt 727,430 41.31%
Short-Term Debt 147,442 8.37%
--------- ------
Total Capitalization $1,760,739 100.00%
--------- ------
4
Pennsylvania Power
------------------
Common Equity $238,272 43.79%
Preferred Stock 54,105 9.94%
Long-Term Debt 251,800 46.27%
Short-Term Debt - -%
--------- ------
Total Capitalization $544,177 100.00%
--------- ------
JCP&L
-----
Common Equity $3,250,625 68.08%
Preferred Stock 137,895 2.89%
Long-Term Debt 1,386,403 29.03%
Short-Term Debt - -%
--------- ------
Total Capitalization $4,774,923 100.00%
--------- ------
Met-Ed
------
Common Equity $1,318,720 61.54%
Preferred Stock 92,357 4.31%
Long-Term Debt 600,034 28.00%
Short-Term Debt 131,780 6.15%
--------- ------
Total Capitalization $2,142,891 100.00%
--------- ------
Penelec
-------
Common Equity $1,330,526 65.76%
Preferred Stock 92,160 4.55%
Long-Term Debt 496,748 24.55%
Short-Term Debt 103,932 5.14%
--------- ------
Total Capitalization $2,023,366 100.00%
--------- ------
Note: FirstEnergy's short-term debt is adjusted to include $99.8 million,
classified as "Liabilities Related to Assets Pending Sale" on the balance sheet.
13. The following table presented in thousands provides retained earnings
analysis of FirstEnergy on a consolidated basis and each Utility Subsidiary as
of the end of the third quarter 2002.
FirstEnergy Ohio Cleveland Toledo
Corp. Edison Electric Edison
----------- ------- --------- --------
Balance, January 1, 2002 $1,521,805 $572,272 $150,183 $113,436
Net Income 660,058 309,205 168,847 36,947
Cash Dividends on Pfd Stock 0 (5,851) (10,429) (7,846)
Cash Dividends on Common Stock (329,565) (121,900) 0 (5,600)
Other 0 0 (4,232) (1,299)
---------- -------- -------- --------
Balance, September 30, 2002 $1,852,298 $753,726 $304,369 $135,638
---------- -------- -------- --------
Penn.
Power JCP&L Met-Ed Penelec
------- ------- ------- -------
Balance, January 1, 2002 $35,398 $ 29,343 $14,617 $10,795
Net Income 45,762 198,134 49,661 30,140
Cash Dividends on Pfd Stock (2,778) (1,347) 0 0
Cash Dividends on Common Stock (28,500) (123,700) (30,000) (14,000)
Other 0 2,936 5,570 4,502
------- -------- ------- -------
Balance, September 30, 2002 $49,882 $105,366 $39,848 $31,437
------- -------- ------- -------
14. During the third quarter of 2002, there was no change to the ratings of
FirstEnergy Corp. or its Utility Subsidiaries by any of the nationally
recognized credit rating agencies.
5
SIGNATURE
The undersigned registered holding company has duly caused this quarterly
report to be signed on its behalf by the undersigned officer thereunto duly
authorized pursuant to the requirements of the Public Utility Holding Company
Act of 1935.
FIRSTENERGY CORP.
November 25, 2002
By: /s/ Harvey L. Wagner
-------------------------------------
Harvey L. Wagner
Vice President, Controller
and Chief Accounting Officer
(Principal Accounting Officer)
6