ComEd 2006 Annual Report Download - page 61

ComEd
As of January 31, 2007, there were outstanding 127,016,519 shares of common stock, $12.50 par
value, of ComEd, of which 127,002,904 shares were held by Exelon. At January 31, 2007, in addition
to Exelon, there were 269 record holders of ComEd common stock. There is no established market for
shares of the common stock of ComEd.
PECO
As of January 31, 2007, there were outstanding 170,478,507 shares of common stock, without par
value, of PECO, all of which were held by Exelon.
Exelon, Generation, ComEd and PECO
Dividends
Under applicable Federal law, Generation, ComEd and PECO can pay dividends only from
retained, undistributed or current earnings. A significant loss recorded at Generation, ComEd or PECO
may limit the dividends that these companies can distribute to Exelon.
Under Illinois law, ComEd may not pay any dividend on its stock unless, among other things, “[its]
earnings and earned surplus are sufficient to declare and pay same after provision is made for
reasonable and proper reserves,” or unless it has specific authorization from the ICC. ComEd may not
declare any dividends on any shares of its capital stock in the event that: (1) it exercises its right to
extend the interest payment periods on the subordinated debt securities issued to ComEd Financing II
or ComEd Financing III; (2) it defaults on its guarantee of the payment of distributions on the preferred
trust securities of ComEd Financing II or ComEd Financing III; or (3) an event of default occurs under
the Indenture under which the subordinated debt securities are issued.
PECO’s Articles of Incorporation prohibit payment of any dividend on, or other distribution to the
holders of, common stock if, after giving effect thereto, the capital of PECO represented by its common
stock together with its retained earnings is, in the aggregate, less than the involuntary liquidating value
of its then outstanding preferred stock. At December 31, 2006, such capital was $2.8 billion and
amounted to about 32 times the liquidating value of the outstanding preferred stock of $87 million.
PECO may not declare dividends on any shares of its capital stock in the event that: (1) it
exercises its right to extend the interest payment periods on the subordinated debentures which were
issued to PECO Energy Capital, L.P. (PEC L.P.) or PECO Energy Capital Trust IV (PECO Trust IV);
(2) it defaults on its guarantee of the payment of distributions on the Series D Preferred Securities of
PEC L.P. or the preferred trust securities of PECO Trust IV; or (3) an event of default occurs under the
Indenture under which the subordinated debentures are issued.
At December 31, 2006, Exelon had retained earnings of $3.4 billion, which includes Generation’s
undistributed earnings of $1.8 billion, ComEd’s retained deficit of $(193) million consisting of an
unappropriated retained deficit of $(1.6) billion, partially offset by $1.4 billion of retained earnings
appropriated for future dividends and PECO’s retained earnings of $584 million.
The following table sets forth Exelon’s quarterly cash dividends per share paid during 2006 and
2005:
2006 2005
(per share)
4th
Quarter
3rd
Quarter
2nd
Quarter
1st
Quarter
4th
Quarter
3rd
Quarter
2nd
Quarter
1st
Quarter
Exelon ................... $0.400 $0.400 $0.400 $0.400 $0.400 $0.400 $0.400 $0.400
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