UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
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þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 20182019
or
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¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
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Commission File No. | Issuing Entity, Sponsor, Depositor, Bond Issuer
| I.R.S. Employer Identification Number | Central Index Key No. |
| 333-187692-06 | FIRSTENERGY OHIO PIRB SPECIAL PURPOSE TRUST 2013 (Exact name of issuing entity as specified in its charter) | 46-6795854 | 0001578443 |
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| 001-02323 | THE CLEVELAND ELECTRIC ILLUMINATING COMPANY (Exact name of sponsor and depositor as specified in its charter) | 34-0150020 | 0000020947 |
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| 001-02578 | OHIO EDISON COMPANY (Exact name of sponsor and depositor as specified in its charter) | 34-0437786 | 0000073960 |
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| 001-03583 | THE TOLEDO EDISON COMPANY (Exact name of sponsor and depositor as specified in its charter) | 34-4375005 | 0000352049 |
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| 333-187692-03 | CEI FUNDING LLC (Exact name of bond issuer as specified in its charter) | 46-1367273 | 0001573334 |
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| 333-187692-01 | OE FUNDING LLC (Exact name of bond issuer as specified in its charter) | 46-1367425 | 0001573352 |
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| 333-187692-04 | TE FUNDING LLC (Exact name of bond issuer as specified in its charter) | 46-1367453 | 0001573279 |
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| | Delaware (State or jurisdiction of incorporation or organization of the issuing entity and the bond issuers) | | |
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| | 76 South Main Street Akron, OH (Address of principal executive offices of the issuing entity, sponsor and depositor and the bond issuers) | 44308 (zip code) | | |
| | (800) 736-3402 | | |
| | (Issuing entity’s, sponsor and depositor and bond issuers’ telephone number, including area code) | | |
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No þ
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ¨þ No þ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No ¨
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer,”filer", “smaller reporting company,” and an “emerging"emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
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Large Accelerated Filer ¨ | | | Accelerated Filer ¨ |
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Non-accelerated Filer þ | | | Smaller Reporting Company ¨ |
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| | | | Emerging Growth Company ¨ |
If an emerging growth company, indicate by check mark if that registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ¨ No þ
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter: Not applicable
Documents incorporated by reference: None.
PART I
Item 1. Business.
Omitted pursuant to General Instruction J of Form 10-K.
Item 1A. Risk Factors.
Omitted pursuant to General Instruction J of Form 10-K.
Item 1B. Unresolved Staff Comments.
None.
Item 2. Properties.
Omitted pursuant to General Instruction J of Form 10-K.
Item 3. Legal Proceedings.
Omitted pursuant to General Instruction J of Form 10-K.
Item 4. Mine Safety Disclosures.
None.
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Omitted pursuant to General Instruction J of Form 10-K.
Item 6. Selected Financial Data.
Omitted pursuant to General Instruction J of Form 10-K.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Omitted pursuant to General Instruction J of Form 10-K.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk.
Omitted pursuant to General Instruction J of Form 10-K.
Item 8. Financial Statements and Supplementary Data.
Omitted pursuant to General Instruction J of Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures.
Omitted pursuant to General Instruction J of Form 10-K.
Item 9A. Controls and Procedures.
Omitted pursuant to General Instruction J of Form 10-K.
Item 9B. Other Information.
None.
PART III
Item 10. Directors, Executive Officers and Corporate Governance.
Omitted pursuant to General Instruction J of Form 10-K.
Item 11. Executive Compensation.
Omitted pursuant to General Instruction J of Form 10-K.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
Omitted pursuant to General Instruction J of Form 10-K.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Omitted pursuant to General Instruction J of Form 10-K.
Item 14. Principal Accountant Fees and Services.
Omitted pursuant to General Instruction J of Form 10-K.
PART IV
Item 15. Exhibits, Financial Statement Schedules.
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| (a) | Documents filed as a part of this report (exhibits marked with an asterisk are filed herewith): |
1. Financial Statements
Not Applicable
2. Financial Statement Schedules
Not Applicable
3. Exhibits required by Item 601 of Regulation S-K (exhibits marked with an asterisk are filed herewith):
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| 4.9 | | |
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| 10.13 | | |
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| 10.14 | | |
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| *31.1 | | |
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| *31.2 | | |
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| *31.3 | | |
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| *33.1 | | |
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| *33.3 | | |
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| *33.4 | | |
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| *33.5 | | |
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| *34.1 | | |
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| *34.3 | | |
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| *34.4 | | |
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| *34.5 | | |
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| *35.1 | | |
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| *35.2 | | |
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| *35.3 | | |
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| (b) | Exhibits required by this Form and Item 601 of Regulation S-K (exhibits marked with an asterisk are filed herewith):
See Item 15(a)(3) above. |
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| (c) | Not Applicable |
Item 16. Form 10-K Summary.
None.
Item 1112(b). Significant Obligors of Pool Assets.
None.
Item 1114(b)(2). Credit Enhancement and Other Support, Except for Certain Derivatives Instruments.
None.
Item 1115(b). Certain Derivatives Instruments.
None.
Item 1117. Legal Proceedings.
U.S. Bank National Association has provided the following information:
Since 2014 various plaintiffs or groups of plaintiffs, primarily investors, have filed claims againstIn the last several years, U.S. Bank National Association (“U.S. Bank”), and other large financial institutions have been sued in itstheir capacity as trustee or successor trustee (as the case may be) underfor certain residential mortgage backed securities ("RMBS") trusts. The plaintiffscomplaints, primarily filed by investors or plaintiffinvestor groups have filed substantially similar complaints against other RMBS trustees, including Deutsche Bank, Citibank, HSBC, Bank of New York Mellon and Wells Fargo. The complaints against U.S. Bank and similar institutions, allege the trusteetrustees caused losses to investors as a result of alleged failures by the sponsors, mortgage loan sellers and servicers to comply with the governing agreements for these RMBS trusts andtrusts. Plaintiffs generally assert causes of action based upon the trustee'strustees’ purported failurefailures to enforce repurchase obligations of mortgage loan sellers for alleged breaches of representations and warranties, concerning loan quality. The complaints also assert that the trustee failed to notify securityholders of purported events of default allegedly caused by breaches of servicing standards by mortgage loan servicers and that the trustee purportedly failed to abide by a heightened standard of care following alleged events of default.
Currently, U.S. Bank is a defendant in multiple actions alleging individual or class action claims against the trustee with respect to multiple trusts as described above. Previously, U.S. Bank disclosed the most substantial case was: BlackRock Balanced Capital Portfolio et al v. U.S. Bank National Association, No. 605204/2015 (N.Y. Sup. Ct.) (class action alleging claims with respect to approximately 770 trusts) and a companion class action case involving additional trusts (collectively, the “BlackRock cases”). Some of the trusts implicated in the aforementioned BlackRock cases, as well as other trusts, are involved in actions brought by separate groups of plaintiffs related to no more than 100 trusts per case.it.
U.S. Bank cannot assure you as to the outcome of any of the litigation, or the possible impact of these litigations on the trustee or the RMBS trusts. However, U.S. Bank denies liability and believes that it has performed its obligations under the RMBS trusts in good faith, that its actions were not the cause of losses to investors, and that it has meritorious defenses, and it has contested and intends to contestcontinue contesting the plaintiffs’ claims vigorously. However, U.S. Bank cannot assure you as to the outcome of any of the litigation, or the possible impact of these litigations on the trustee or the RMBS trusts.
On March 9, 2018, a law firm purporting to represent fifteen Delaware statutory trusts (the “DSTs”) that issued securities backed by student loans (the “Student Loans”) filed a lawsuit in the Delaware Court of Chancery against U.S. Bank National Association (“U.S. Bank”) in its capacities as indenture trustee and successor special servicer, and three other institutions in their respective transaction capacities, with respect to the DSTs and the Student Loans. This lawsuit is captioned The National Collegiate Student Loan Master Trust I, et al. v. U.S. Bank National Association, et al., C.A. No. 2018-0167-JRS (Del. Ch.). The complaint, which was later amended on June 15, 2018, alleged that the DSTs have been harmed as a result of purported misconduct or omissions by the defendants concerning administration of the trusts and servicing of the student loans.
U.S. Bank believes that it has performed its obligations as indenture trustee and special servicer in good faith and in compliance in all material respects with the terms of the agreements governing the DSTs (the “Governing Agreements”), and accordingly that the claims against it in the lawsuit are without merit.
U.S. Bank has filed a motion seeking dismissal of the operative complaint in its entirety with prejudice pursuant to Chancery Court Rules 12(b)(1) and 12(b)(6) or, in the alternative, U.S. Bank requested a stay of the case while other prior filed disputes involving the DSTs and the Student Loans are being litigated. On November 7, 2018, the Court ruled that the case should be stayed in its entirety pending resolution of the first-filed cases.
U.S. Bank intends to continue to defend this lawsuit vigorously.
Item 1119. Affiliations and Certain Relationships and Related Transactions.
The Issuing Entity is a Delaware statutory trust specifically formed by the bond issuers, CEI Funding LLC, OE Funding LLC and TE Funding LLC, for the purpose of acquiring bonds from the bond issuers and issuing the certificates. CEI Funding LLC, OE Funding LLC and TE Funding LLC are wholly-owned subsidiaries of the servicers, The Cleveland Electric Illuminating Company, Ohio Edison Company and The Toledo Edison Company, respectively (such servicers also serving in the capacity as administrative trustees under the Amended and Restated Declaration of Trust of the Issuing Entity).
Item 1122. Compliance with Applicable Servicing Criteria.
See Exhibits 33.1, 33.2, 33.3, 33.4, 33.5, 34.1, 34.2, 34.3, 34.4 and 34.5 under Item 15. Additionally, the assessment of compliance with applicable servicing criteria for the year ended December 31, 2018, furnished pursuant to Item 1122 of Regulation AB discloses a material instance of noncompliance occurred with respect to the servicing criteria set forth in 1122(d)(3)(i) of Regulation AB. FirstEnergy Ohio PIRB Special Purpose Trust 2013 Asset Backed Issuer Distribution Report on Form 10-D for the semi-annual distribution period was filed late.
Item 1123. Servicer Compliance Statement.
See Exhibits 35.1, 35.2 and 35.3 under Item 15.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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| | FIRSTENERGY OHIO PIRB SPECIAL PURPOSE TRUST 2013 |
| | (Issuing entity) |
| | BY: | THE CLEVELAND ELECTRIC ILLUMINATING COMPANY, as Servicer |
| | | OHIO EDISON COMPANY, as Servicer |
| | | THE TOLEDO EDISON COMPANY, as Servicer |
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| | | BY: | /s/ Steven R. Staub |
| | | | Steven R. Staub |
| | | | Vice President and Treasurer |
Date: March 29, 201926, 2020
Supplemental Information to be Furnished With Reports Filed Pursuant to Section 15(d) of the Act by Registrants
Which Have Not Registered Securities Pursuant to Section 12 of the Act
No such annual report, proxy statement, form of proxy or other proxy soliciting material has been sent to the registrant’s securityholders. The registrant will not be sending an annual report or proxy material to its securityholders subsequent to the filing of this report on Form 10-K.