Exelon 2015 Annual Report Download - page 291

Table of Contents
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
combine the two companies in an all cash transaction. The resulting company will retain the Exelon name. Under the Merger Agreement, PHI’s
shareholders will receive $27.25 of cash in exchange for each share of PHI common stock. Based on the outstanding shares of PHI’s common
stock as of December 31, 2015, PHI shareholders would receive $6.9 billion in total cash. In addition, in connection with the Merger Agreement,
Exelon entered into a subscription agreement under which it has purchased $180 million of a class of nonvoting, nonconvertible and
nontransferable preferred securities of PHI. The preferred securities are included in Other non-current assets on Exelon’s Consolidated Balance
Sheet. PHI has the right to redeem the preferred securities at its option for the purchase price paid plus accrued dividends, if any.
On November 2, 2015, Exelon and PHI each filed a new Notification and Report Form with the DOJ under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (HSR Act) due to the expiration of the original filing. The HSR Act waiting period expired on December 2, 2015, and the
HSR Act no longer precludes completion of the merger.
To date, the PHI stockholders, the Virginia State Corporation Commission, the New Jersey Board of Public Utilities (NJBPU), the Delaware
Public Service Commission (DPSC), the Maryland Public Service Commission (MDPSC) and the FERC have approved the merger of PHI and
Exelon. The Federal Communications Commission has also approved the transfer of certain PHI communications licenses.
On February 11, 2015, the NJBPU approved the proposed merger and the previously filed settlement signed and filed by Exelon, PHI,
Atlantic City Electric (ACE), NJBPU staff, and the Independent Energy Coalition. The settlement provides a package of benefits to ACE
customers and the state of New Jersey. This package of benefits includes the establishment of customer rate credit programs, with an aggregate
value of $62 million for ACE customers and energy efficiency programs that will provide savings for ACE customers of $15 million. The March 6,
2015, order by the NJBPU approving the merger required that the consummation of the merger must take place no later than November 1, 2015
unless otherwise extended by the Board. On October 15, 2015, the NJBPU extended the November 1, 2015 date to June 30, 2016.
On February 13, 2015, Exelon and PHI announced that they had reached a settlement agreement in the proceeding before the DPSC to
review the proposed merger. The settlement, which was amended on April 7, 2015, was signed and filed by Exelon, PHI, Delmarva Power & Light
Company (DPL), the DPSC Staff, the Delaware Public Advocate, the Delaware Department of Natural Resources and Environmental Control, the
Delaware Sustainable Energy Utility, the Mid-Atlantic Renewable Energy Coalition and the Clean Air Council. As part of this settlement, Exelon
and PHI proposed a package of benefits to DPL customers and the state of Delaware including the establishment of customer rate credits of $40
million for DPL customers in Delaware, $2 million of funding for energy efficiency programs for DPL low income customers, and $2 million of
funding for workforce development. On June 2, 2015, the DPSC issued an order accepting the settlement and approving the merger between
Exelon and PHI.
On March 17, 2015, Exelon and PHI announced that they had reached settlements with multiple parties in the Maryland proceeding to review
the proposed merger after filing a Request for Adoption of Settlements with the MDPSC. The settlements were signed and filed by Exelon, PHI,
Montgomery County, Prince George’s County, the National Consumer Law Center, National Housing Trust, the Maryland Affordable Housing
Coalition, the Housing Association of Nonprofit Developers, and a consortium of recreational trail advocacy organizations led by the Mid-Atlantic
Off-Road Enthusiasts.
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Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
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