As filed with the Securities and Exchange Commission on April 29, 2005
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
UGI Utilities, Inc.
(Exact name of registrant as specified in its charter)
Pennsylvania 23-1174060
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
100 Kachel Boulevard, Suite 400
Green Hills Corporate Center
Reading, PA 19607
(610) 796-3400
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Robert H. Knauss, Esq.
Vice President and General Counsel
UGI Utilities, Inc.
460 North Gulph Road
King of Prussia, PA 19406
(610) 337-1000
(Name, address, including zip code, and telephone number
including area code, of agent for service)
with copy to:
Linda L. Griggs, Esq.
Morgan, Lewis & Bockius LLP
1111 Pennsylvania Ave., N.W.
Washington, D.C. 20004
(202) 739-5245
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this registration statement as determined by
market conditions and other factors.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [__]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [__]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [__]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [__]
------------------
CALCULATION OF REGISTRATION FEE
Title of Each Class Proposed Maximum Proposed Maximum Amount of
of Securities to be Amount to be Offering Price Per Aggregate Offering Registration
Registered Registered Unit (1) Price (1)(2) Fee
Debt Securities $125,000,000 100% $125,000,000 $14,713.00
- ----------
(1) Estimated solely for the purpose of determining the registration fee.
(2) In no event will the aggregate initial offering price of all securities
issued from time to time pursuant to this registration statement exceed
$125,000,000. If any such securities are issued at an original issue
discount, then the aggregate initial offering price as so discounted shall
not exceed $125,000,000, notwithstanding that the stated principal amount
of such securities may exceed such amount.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale of these securities is not
permitted.
Subject to completion, dated April 29, 2005
PROSPECTUS
$125,000,000
UGI UTILITIES, INC.
-------------------
DEBT SECURITIES
-------------------
This prospectus contains summaries of the general terms of these debt
securities. We will provide the specific terms of these debt securities in
supplements to this prospectus.
You should read this prospectus and the prospectus supplements carefully before
you invest.
INVESTING IN OUR DEBT SECURITIES INVOLVES RISK. SEE "RISK FACTORS" BEGINNING ON
PAGE 5 OF THIS PROSPECTUS.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these debt securities or passed upon
the adequacy or accuracy of this prospectus. Any representation to the contrary
is a criminal offense.
The date of this prospectus is , 2005
1
TABLE OF CONTENTS
PAGE
About this Prospectus.......................................................3
Where You Can Find More Information.........................................3
About UGI Utilities, Inc....................................................4
Risk Factors ...............................................................5
Ratio of Earnings to Fixed Charges..........................................7
Use of Proceeds.............................................................7
Description of Debt Securities..............................................7
Form, Exchange, Registration, Transfer and Payment.......................9
Global Securities........................................................9
Restrictive Indenture Provisions.........................................10
Events of Default........................................................13
Modification of the Indenture............................................14
Consolidation, Merger, Sale or Conveyance................................15
Satisfaction and Discharge..................................................15
Governing Law...............................................................15
Regarding the Trustee.......................................................15
Plan of Distribution........................................................16
Experts.....................................................................17
Legal Opinion...............................................................17
No dealer, salesperson or other person is authorized to give any information or
to represent anything not contained in this prospectus. You must not rely on any
unauthorized information or representations. This prospectus is an offer to sell
only the debt securities offered hereby, but only under circumstances and in
jurisdictions where it is lawful to do so. The information contained in this
prospectus is current only as of its date.
2
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the SEC
using a "shelf" registration process. Under this shelf process, we may sell any
of the types of debt securities described in this prospectus, including
debentures, notes and/or other unsecured indebtedness, in one or more offerings
up to a total dollar amount of $125,000,000. This prospectus provides you with a
general description of the debt securities that we may offer.
We provide information to you about the debt securities in three documents that
progressively provide more detail:
1. This Prospectus. Contains general information that may or may not apply to
each offering of debt securities.
2. The Prospectus Supplement. Will contain more specific information than this
prospectus and may also add, update or change information contained in this
prospectus. To the extent information differs from this prospectus, you should
rely on the different information in the prospectus supplement.
3. The Pricing Supplement. If applicable, will provide final details about a
specific offering and the terms of the offered debt securities, including their
price. To the extent information differs from this prospectus or the prospectus
supplement, you should rely on the different information in the pricing
supplement.
You should read this prospectus, any prospectus supplement and any pricing
supplement together with any additional information described under the heading
WHERE YOU CAN FIND MORE INFORMATION to learn about us.
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement that we filed with the SEC.
The registration statement contains additional information about us and the debt
securities. In addition, we file annual, quarterly and special reports and other
information with the SEC. Our SEC filings are available to the public over the
internet at the SEC's website at http://www.sec.gov. You may also read and, for
a fee, copy any document that we file with the SEC at the SEC's public reference
room at:
- - Room 1024
450 Fifth Street, N.W.
Washington, D.C. 20549
Please call the SEC at 1-800-SEC-0330 for further information on the operation
of the public reference room.
This prospectus does not repeat important information that you can find
elsewhere in the registration statement and in the reports and other documents
which we file with the SEC under
3
the Securities Exchange Act of 1934. The SEC allows us to "incorporate by
reference" the information we file with it, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is an important part of this prospectus,
and information that we file later with the SEC will automatically update and
supersede that information. We incorporate by reference the documents listed
below, and all future filings made with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act until we sell all of the debt securities.
- annual report on Form 10-K for the fiscal year ended September 30,
2004,
- quarterly report on Form 10-Q for the quarter ended December 31,
2004, and
- current reports on Form 8-K dated November 1, 2004, November 17,
2004, January 26, 2005 and April 27, 2005.
We are not required to, and do not, provide annual reports to holders of our
debt securities unless specifically requested by a holder.
You may request a copy of our SEC filings at no cost by writing or telephoning
us at the following address:
Vice President and General Counsel
UGI Utilities, Inc.
100 Kachel Boulevard
Green Hills Corporate Center
Suite 400
Reading, PA 19607
(610) 796-3400
You should rely only on the information we incorporate by reference or provide
in this prospectus or any prospectus supplement. We have not authorized anyone
else to provide you with different information. We are not making an offer of
these debt securities in any state where the offer is not permitted. You should
not assume that the information in this prospectus or any prospectus supplement
is accurate as of any date other than the date on the front of those documents.
ABOUT UGI UTILITIES, INC.
We are a public utility company that owns and operates
- - a natural gas distribution utility serving 14 counties in eastern and
southeastern Pennsylvania, and
- - an electric utility serving parts of Luzerne and Wyoming counties in
northeastern Pennsylvania.
4
In response to state deregulation legislation, effective October 1, 1999, we
transferred our electric generation assets to our non-utility subsidiary, UGI
Development Company. UGI Development Company contributed certain of its
generation assets to a joint venture with a subsidiary of Allegheny Energy, Inc.
in December 2000. In June 2003, we dividended the stock of UGID to UGI
Corporation. UGID's results of operations did not have a material effect on our
results of operations for fiscal year 2003 or 2002. We are a wholly owned
subsidiary of UGI Corporation.
We were incorporated in Pennsylvania in 1925 as the successor to a business
founded in 1882. We are subject to regulation by the Pennsylvania Public Utility
Commission. Our executive offices are located at 100 Kachel Boulevard, Suite
400, Green Hills Corporate Center, Reading, Pennsylvania 19607, and our
telephone number is (610) 796-3400.
RISK FACTORS
Before purchasing our debt securities you should carefully consider the
following risk factors as well as the other information contained in this
prospectus and the information incorporated by reference. Documents we file with
the SEC after the date of this prospectus may contain additional risk factors,
or updates to the risk factors discussed below, which you should also consider.
See "Where You Can Find More Information."
OUR RESULTS OF OPERATIONS, FINANCIAL CONDITION AND CASH FLOWS COULD BE ADVERSELY
AFFECTED BY REDUCED DEMAND FROM MILDER WEATHER SINCE OUR RATE STRUCTURE DOES NOT
CONTAIN WEATHER NORMALIZATION PROVISIONS.
Weather conditions directly influence the demand for natural gas and
electricity, which could affect our results. Demand for natural gas and
electricity generally peaks during the cold winter months. Consequently, the
overall operating results of our operations tend to fluctuate on a seasonal
basis. Our rate structure does not contain weather normalization provisions to
compensate for milder weather conditions, and we have historically sold less
natural gas and electricity when weather conditions are milder and,
consequently, earned less income. As a result, an unusually mild winter could
reduce our net income and harm our financial condition and adversely affect our
cash flows.
INCREASES IN GAS AND ELECTRICITY MARKET PRICES COULD ADVERSELY AFFECT OUR
BUSINESS.
Increases in the current market price of gas could cause us to raise the prices
we charge our customers, which in turn could reduce demand for our gas. This
could lower our revenues and, therefore, lower our net income and adversely
affect our cash flows.
Similarly, beginning in 2007 when our current mandatory rate caps expire,
increases in the market price of electricity could cause us to raise the prices
that we charge our customers, which in turn could reduce demand for our
electricity. This could lower our revenues, and, therefore, lower our net income
and adversely affect our cash flows.
5
ELECTRICITY SUPPLIER DEFAULTS MAY ADVERSELY AFFECT OUR RESULTS OF OPERATIONS.
Generally, we purchase our power needs from electricity suppliers under
fixed-price energy and capacity contracts. Should any of the suppliers under
these contracts fail to provide electric power under the terms of these
contracts, any increases in the cost of replacement power or capacity could
negatively impact our results and adversely affect our cash flows because of our
inability to recover these potential cost increases in our current rates.
REMEDIATION COSTS RESULTING FROM LIABILITY FROM CONTAMINATION CLAIMS COULD
REDUCE OUR NET INCOME.
We are currently investigating and remediating contamination at a number of
present and former operating sites in the United States, including former sites
where we operated manufactured gas plants. We have also received claims from
third parties that allege that we are responsible for costs to clean up
properties where we or our former subsidiaries operated a manufactured gas
plant. Costs we incur to remediate sites outside of Pennsylvania cannot be
recovered in future utility rate proceedings, and insurance may not cover all or
even part of these costs.
We do not expect costs for investigation and remediation of hazardous substances
at Pennsylvania manufactured gas plant sites to be material to our results of
operations because we are currently permitted to include in rates, through
future base rate proceedings, prudently incurred remediation costs associated
with such sites. We have been notified, however, of several sites outside
Pennsylvania on which private parties allege manufactured gas plants were
formerly owned or operated by us or owned or operated by our former
subsidiaries. Such parties are investigating the extent of environmental
contamination or performing environmental remediation. We are currently
litigating three claims relating to out-of-state sites.
Management believes that under applicable law we should not be liable in those
instances in which a former subsidiary owned or operated a manufactured gas
plant. There could be, however, significant future costs of an uncertain amount
associated with environmental damage caused by manufactured gas plants outside
Pennsylvania that we directly operated, or that were owned or operated by our
former subsidiaries, if a court were to conclude that (1) the subsidiary's
separate corporate form should be disregarded or (2) we should be considered to
have been an operator because of our conduct with respect to our subsidiary's
manufactured gas plant. In addition, if we discover additional contaminated
sites, we could be required to incur material costs, which would reduce our net
income and adversely affect our cash flows.
OTHER RISKS MAY ADVERSELY AFFECT OUR FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
In addition to the risks discussed above, our financial condition, results of
operations and cash flows may also be adversely affected by the following
additional factors:
- - customer conservation measures and improvements in energy efficiency and
technology resulting in reduced demand;
- - interest rate fluctuations;
- - access to capital markets at competitive rates;
6
- - liability for personal injury and property damage arising from explosions
and other catastrophic events, including liability in excess of insurance
coverage;
- - changes in laws and regulations, including safety, tax and accounting;
- - competitive pressures from the same and alternative energy sources; and
- - political, regulatory and general economic conditions in the United
States.
RATIO OF EARNINGS TO FIXED CHARGES
Three Months
Ended Year Ended September 30,
December 31,
Ratio of Earnings to Fixed Charges 2004 2003 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ---- ----
6.76 6.93 5.28 6.25 5.04 4.87 5.21
For purposes of this computation, "earnings" means pretax income from continuing
operations plus (i) interest (excluding capitalized interest) and amortization
of debt expense and (ii) the portion of operating rental expense that management
believes is representative of the interest component of rent expense. "Fixed
charges" means the sum of (i) and (ii) above, including capitalized interest.
USE OF PROCEEDS
Unless we state otherwise in the applicable prospectus supplement, the net
proceeds from any sale of debt securities will be used for general corporate
purposes, which may include refinancings of indebtedness, working capital,
capital expenditures, and repurchases and redemptions of securities.
DESCRIPTION OF DEBT SECURITIES
We will issue the debt securities under an indenture dated as of August 1, 1993,
between us and Wachovia Bank, National Association, formerly First Union
National Bank, formerly First Fidelity Bank, National Association, as the
trustee.
We summarize selected provisions of the indenture below and refer you directly
to the sections in the indenture where these provisions may be found. Because
this is only a summary, it is not complete and does not describe every aspect of
the debt securities. This summary is also subject to and qualified by reference
to the description of the particular terms of the series of the debt securities
that we offer to you and describe in the applicable prospectus supplement. You
should read the indenture for provisions that may be important to you but which
are not included in this summary.
7
General
We will issue the debt securities from time to time in one or more series. A
prospectus supplement or a pricing supplement will describe the terms of a
particular series and specify the aggregate principal amount of each series. The
debt securities will be our direct unsecured obligations and will rank equally
with our other unsecured debt. The indenture does not limit the amount of debt
securities that we may issue under it.
Provisions Applicable to a Particular Series
The prospectus supplement or pricing supplement for a particular series of debt
securities being offered will describe the specific terms related to the
offering, including the price or prices at which the debt securities to be
offered will be issued. These terms may include some or all of the following:
- the title of the series;
- the total principal amount of the debt securities of the series;
- the date or dates on which the principal is payable;
- the interest rate or rates, if any, or the method for determining
the rate or rates, and the date or dates from which interest will
accrue;
- the date or dates from which interest will accrue, the interest
payment dates and the record date for the interest payable on each
interest payment date;
- the place or places where interest, principal and any premium
payments will be made;
- whether we have the option to redeem the debt securities and, if so,
the terms of our redemption option;
- any obligation that we have to redeem the debt securities by way of
payment to a sinking fund;
- any obligation that we have to repurchase the debt securities at the
holder's option;
- the portion of the principal payable upon acceleration of maturity,
or provable in bankruptcy, if other than the entire principal;
- whether the debt securities will be represented by a global
security, as discussed in the section below entitled Global
Securities; and
- any other additional or different terms of the debt securities.
We will issue the debt securities in denominations of $1,000 and any integral
multiples of $1,000, unless we state otherwise in the applicable prospectus
supplement. (Section 2.7.) We may offer and sell the debt securities at a
discount below their principal amount. The applicable prospectus supplement will
describe special United States federal income tax and any other considerations
applicable to those debt securities.
8
We need not issue all of the debt securities of a particular series at the same
time and, unless otherwise provided, we may reopen a series, without the consent
of the holders of the debt securities of that series, for issuances of
additional debt securities of that series.
Form, Exchange, Registration, Transfer and Payment
We will issue the debt securities in registered form, unless we state otherwise
in the prospectus supplement. (Section 2.7.) We will pay the principal of and
interest on the debt securities at our agent's offices in Philadelphia,
Pennsylvania or at any of our offices that we designate. You may exchange or
transfer the debt securities at the same offices. (Section 3.2.)
If you hold debt securities registered in definitive form with an aggregate
principal amount equal to or greater than $1,000,000, you may instruct us in
writing to direct our paying agent to pay the principal and accrued interest of
such debt securities directly to your account at any United States bank, as long
as such written instructions are received no less than 15 days prior to a
scheduled interest payment date and as long as the United States bank is
equipped to receive such a direct deposit. (Section 3.1.)
You may transfer or exchange debt securities without a service charge. We may,
however, require a payment to cover any applicable tax or governmental charge.
(Section 2.8.)
If we have transferred funds to our paying agent to make scheduled principal or
interest payments in respect of any of the debt securities, and you do not claim
such principal or interest payment within three years, we may reclaim such funds
and you will have to look to us, and not the paying agent, for payment. (Section
9.4.)
Global Securities
We may issue some or all of the debt securities of a particular series in the
form of one or more global certificates registered in the name of a securities
depositary or its nominee identified in the applicable prospectus supplement.
Each global security will be deposited with the securities depositary or its
nominee or a custodian for the securities depositary, as identified in the
applicable prospectus supplement.
Except with respect to transfers of the global security as a whole between the
depositary and its nominee or between the depositary and a successor depositary,
a global security may not be transferred or exchanged unless and until it is
exchanged in whole or in part for debt securities in definitive form. (Sections
2.4 and 2.8.)
As long as the securities depositary or its nominee is the registered holder of
a global security representing a series of the debt securities, that person will
be considered the sole owner and holder of the global security and the debt
securities, or series of debt securities, that it represents for all purposes.
(Sections 2.4 and 2.8.) Unless we otherwise state in an applicable prospectus
supplement, if you have a beneficial interest in a global security:
9
- you may not have the global security, or any debt securities that it
represents, registered in your name;
- you may not receive or be entitled to receive physical delivery of
certificated debt securities in exchange for your beneficial
interest in the global security; and
- you will not be considered the holder of the global security, or any
debt securities it represents, for any purpose under the indenture.
We will make all payments of principal and interest on a global security to the
securities depositary or its nominee as the holder of the global security. The
laws of some jurisdictions require that certain purchasers of securities, for
example, insurance companies, take physical delivery of securities in definitive
form. These laws may impair your ability to transfer beneficial interests in a
global security.
The only persons that may own beneficial interests in a global security are
institutions having accounts with the securities depositary or its nominee,
which are called "participants" in this discussion, and persons that hold
beneficial interests through participants. When a global security representing
debt securities is issued, the securities depositary will credit to the accounts
of the participants that we, or the particular underwriters of the offering,
identify for the securities depositary on the depositary's book-entry,
registration and transfer system, the respective principal amounts of debt
securities that the global security represents.
Ownership of beneficial interests in a global security will be shown only, and
the transfer of those ownership interests will be effected only through, records
maintained by:
- the securities depositary, with respect to a participant's direct
holdings; and
- the applicable participants with respect to beneficial interests
that the participants hold on behalf of other persons.
Accordingly, if you hold a beneficial interest in debt securities through a
participant, you must look to the participant to receive any payments in respect
of principal of or interest on the debt securities and must follow the
participant's own procedures to exercise your own rights under the indenture.
We will describe the specific terms of any depositary agreement in the
applicable prospectus supplement.
Restrictive Indenture Provisions
Limitation on Mortgages
Under the indenture, if we, or any of our subsidiaries, incur or guarantee debt
that is secured by any of our or our subsidiary's property, we must secure the
debt securities at least equally and ratably with such secured debt. This
requirement does not apply, however, if the total amount of
10
our debt that is secured by property does not exceed 10% of our consolidated net
tangible assets. (Section 3.10.)
This restriction on the incurrence or guarantee of debt secured by a mortgage
does not apply to the following types of mortgages:
- mortgages of a subsidiary that existed at the time it became our
subsidiary;
- mortgages that existed at the time of an acquisition of property or
that were created in connection with an acquisition, for example,
mortgages created to secure the purchase price in the acquisition;
- construction mortgages which are entered into, or for which
commitments are received within certain time periods;
- mortgages in our favor or in favor of one of our subsidiaries;
- mortgages existing at the date that any then outstanding debt
securities were issued;
- mortgages existing on any property at the time that we or one of our
subsidiaries acquired it in connection with a merger, consolidation,
lease, acquisition or other transaction;
- mortgages in favor of governmental bodies to secure payments
pursuant to any contract or statute;
- any extensions, renewals or replacements of any of these categories
of mortgages. (Section 3.10.).
In determining whether the amount of debt secured by mortgages does not exceed
10% of our consolidated net tangible assets, the aggregate amount of debt
secured by mortgages should not include the mortgages listed above. (Section
3.10.). In calculating our consolidated net tangible assets, the following items
should be subtracted from our total consolidated assets using our most recent
consolidated balance sheet:
- applicable reserves and other properly deductible items;
- current liabilities, except the current portion of long-term
liabilities and liabilities under capital leases; and
- various intangible assets. (Section 1.1.).
11
Limitations on Sale and Leaseback Transactions
The indenture prohibits us and any of our subsidiaries from selling or
transferring property with the intention of leasing it back. However, this
restriction does not apply in the following situations:
- if the lease period is for a term of not more than three years at
the end of which the use will be discontinued;
- if the sale and leaseback transaction is between us and one of our
subsidiaries or between subsidiaries;
- if we or our subsidiary would be entitled under the limitation on
mortgages provisions described above, without triggering an
obligation on our part under those provisions to then equally and
ratably secure the debt securities, to incur indebtedness secured by
a mortgage on the property involved in the sale and leaseback
transaction in an amount at least equal to the amount of
attributable debt, which is an amount equal to the lesser of
- the fair market value of the property, as determined by our
board, and
- the present value of the total net amount of the rent payable
by us under the lease of the property, discounted at the rate
of interest set forth or implicit in the terms of the lease,
or, if not practicable to determine such rate, the weighted
average interest rate per annum paid by us to the holders of
debt securities then outstanding compounded semi-annually;
- if, in the opinion of our board, the proceeds of the sale of the
property in the sale and leaseback transaction are determined to
represent the fair market value of such property, and we apply an
amount of such proceeds equal to the greater of the net proceeds of
the sale or the amount of attributable debt, as defined above,
within 180 days of the sale, to either or both of
- the retirement of our or one of our subsidiary's debt that
matures more than 12 months after its creation, other than
pursuant to a mandatory retirement or prepayment of debt or a
contractual obligation and other than debt that is subordinate
to the debt securities or owed to us or a subsidiary, or
- the purchase, construction or development of comparable
property; or
- if the sale and leaseback transaction is entered into within 60 days
of our or our subsidiary's initial acquisition of the property.
(Section 3.11.).
12
Events of Default
Under the indenture, it is an event of default if:
- we fail to pay any interest on any debt securities within 10 days of
a scheduled interest payment date;
- we fail to pay all or a portion of the principal on any of the debt
securities when it is due;
- we fail to make any required sinking fund payment in respect of any
debt securities when due and payable;
- we fail to perform any other covenant or agreement applicable to the
debt securities within 30 days after we receive written notice of
that failure;
- we or one of our significant subsidiaries is involved in certain
types of events involving bankruptcy, insolvency or reorganization;
- there is an event of default under any of our other instruments of
indebtedness under which we had outstanding as of August 1, 1993, or
at any time thereafter, an aggregate principal amount of $10,000,000
or greater, if such event of default involves a failure to pay all
or a portion of the principal amount of such indebtedness when due
and payable, or the maturity of such indebtedness is accelerated and
such acceleration is not rescinded or annulled within 10 days after
notice of such acceleration is given to us, provided that such event
of default has not been remedied or cured by us or waived by the
holders of such indebtedness; or
- there is any other event of default under the terms of the debt
securities.
Under certain circumstances, the trustee need not provide notice to the holders
of the debt securities that an event of default has taken place. (Section 4.1.).
Remedies if an Event of Default Occurs
If an event of default occurs, other than an event of default involving
bankruptcy, insolvency or reorganization, either the trustee or the holders of
at least 25% in total principal amount of the debt securities of the relevant
series may declare the entire principal amount of such series due and payable
immediately. (Section 4.1.)
If an event of default involving our failure to perform a covenant or agreement
under the indenture occurs, and if such failure is with respect to all of the
series of the debt securities outstanding at that time, then either the trustee
or the holders of at least 25% in total principal amount of the debt securities
may declare the entire principal amount of all of the debt securities due and
payable immediately, if such event of default is continuing at the time the
trustee or the holders make such declaration. (Section 4.1.)
13
If an event of default occurs due to an event involving bankruptcy, insolvency
or reorganization, the total principal amount of all of the outstanding debt
securities will automatically be due and payable immediately, without notice to
us. (Section 4.1.)
Under various circumstances, the declaration of an event of default under the
indenture may be overturned by the holders of a majority in principal amount of
the debt securities of all affected series outstanding at that time. (Section
4.10.)
The holders of a majority in principal amount of the debt securities of any
particular series outstanding have, with various exceptions, the right to direct
the time, method and place of conducting any proceedings for any remedy
available to the trustee with respect to the debt securities of that series. The
trustee is under no obligation to exercise any of its rights or powers at the
request or direction of the holders of the debt securities, however, unless
those holders have offered the trustee reasonable indemnity against the expenses
and liabilities that it might incur as a result. (Sections 4.9 and 5.2.)
Except for actions for the payment of overdue principal or interest, under the
indenture (Sections 4.6 and 4.7), a holder may not institute an action against
us unless
- the holder shall have previously given to the trustee written notice
of default and continuation of such default; or
- the holders of not less than 25% in principal amount of the debt
securities of the series outstanding at that time shall have
requested the trustee to institute such action and shall have
offered the trustee reasonable indemnity, and the holders of a
majority of the principal amount of the debt securities of each
affected series shall not have given the trustee contrary
instructions; and
- the trustee shall not have instituted such action within 60 days of
such request.
Modification of the Indenture
Under the indenture, in order to change our rights and obligations or the rights
of any holders of debt securities, the holders of a majority in principal amount
of the debt securities of all series affected by such change, voting as one
class, must consent to the change. However, we may not make any of the following
changes unless each holder of debt securities affected by such change gives his
or her specific consent:
- extend the final maturity date of any of the debt securities;
- reduce the principal amount of any of the debt securities;
- reduce the interest rate on the debt securities or extend the
interest payment date of any of the debt securities;
- reduce the amount payable to the holders of any debt securities on
redemption of such debt securities;
14
- reduce the amount of principal that would be payable to the holders
of the debt securities upon acceleration under the indenture;
- impair or affect any holder's right to institute suit for payment;
- impair or affect any holder's right to repayment; or
- reduce the percentage of principal amount held by holders required
to modify other terms of the indenture from 51%. (Section 7.2.).
Consolidation, Merger, Sale or Conveyance
We may not merge or consolidate with any other corporation, or sell or convey
all or substantially all of our assets to any person, unless:
- we are the surviving corporation, or
- the successor corporation or the corporation that acquires our
assets is incorporated in the United States, executes a supplemental
indenture expressly assuming our obligation to make punctual
payments of principal of and interest on all of the debt securities,
according to the applicable interest rate under each series of debt
securities, and expressly assumes all of our other obligations under
the indenture.
We also may not merge or consolidate with any other corporation or sell or
convey all or substantially all of our assets to any person if, immediately
after such merger, consolidation, sale or conveyance, we or the successor
corporation, as the case may be, would be in default of performance obligations
under any covenant or condition contained in the indenture. (Section 8.1.)
SATISFACTION AND DISCHARGE
Under the indenture (Section 9.1), we may terminate certain of our obligations
with respect to any series of debt securities by irrevocably depositing in trust
with the trustee, on or within one year prior to the maturity or redemption date
of such debt securities, cash sufficient to pay the principal of and interest,
if any, due and to become due on, such debt securities and any other sums
payable to the holders of such debt securities.
GOVERNING LAW
The indenture and the debt securities are governed by the laws of the State of
New York. (Section 10.8.)
REGARDING THE TRUSTEE
Wachovia Bank is the trustee under the indenture and serves as our registrar and
disbursing agent for two prior series of medium term notes. We and Wachovia are
also parties to a Revolving Loan Agreement. Wachovia Bank also acts as a
depository for our funds and from time to time
15
makes loans to our affiliates. Certain affiliates of the trustee engage in
transactions with and perform services for us and our affiliates in the ordinary
course of business.
The Company has total revolving credit commitments under which it may borrow up
to $110 million. These agreements expire in June 2007. At December 31, 2004
borrowings under these agreements totaled $63 million.
PLAN OF DISTRIBUTION
We may sell the debt securities:
- to or through underwriters or dealers; or
- directly to one or more purchasers; or
- through agents; or
- a combination of the above.
The prospectus supplement or the pricing supplement will describe the details of
the plan of distribution, including the offering price, our proceeds from the
sale, the names of the underwriters, dealers or agents and their commissions,
fees or discounts.
In connection with the sale of the debt securities, underwriters, dealers or
agents may receive compensation from us or from purchasers in the form of
discounts, concessions or commissions. Underwriters, dealers and agents that
participate in the distribution of the debt securities may be underwriters as
defined in the Securities Act of 1933, the "Act." Any discounts or commissions
they receive from us and any profits they receive on the resale of the debt
securities may be treated as underwriting discounts and commissions under the
Act. We will identify any underwriters, dealers or agents and describe their
compensation in the prospectus supplement.
We may have agreements with the underwriters and agents to indemnify them
against certain civil liabilities, including liabilities under the Act.
Underwriters, dealers, and agents may engage in transactions with, or perform
services for, us in the ordinary course of business. This includes commercial
banking and investment banking transactions. If underwriters are used in the
sale, they will acquire the debt securities for their own account. The
underwriters may resell the debt securities in one or more transactions,
including negotiated transactions. These sales will be made at a fixed public
offering price or at varying prices determined at the time of the sale. We may
offer the debt securities to the public through an underwriting syndicate or
through a single underwriter.
Unless the prospectus supplement states otherwise, the obligations of the
underwriters to purchase the debt securities will be subject to certain
conditions. The underwriters will be obligated to purchase all of the debt
securities of the series offered if any of the debt securities are purchased,
unless the prospectus supplement states otherwise. We may change from time to
time any initial public offering price and any discounts or concessions allowed,
re-allowed or paid to dealers.
16
If we designate agents to sell the debt securities, they will agree to use their
best efforts to solicit purchases for the period of their appointment.
We may choose to sell the debt securities directly. In this case, no
underwriters, dealers or agents would be involved.
We may authorize underwriters, dealers or agents to solicit certain
institutional investors to purchase debt securities on a delayed delivery basis,
which provides for payment and delivery on a specified future date. The
prospectus supplement will provide the details of any such arrangement,
including the offering price and commissions payable on the solicitations.
We will only enter into these delayed delivery contracts with institutional
purchasers that we approve. Such institutions may include commercial and savings
banks, insurance companies, pension funds, investment companies and educational
and charitable institutions. The underwriters, dealers or agents will have no
responsibility to assure the validity or performance of these contracts.
EXPERTS
The financial statements incorporated in this Prospectus by reference to the
Annual Report on Form 10-K for the year ended September 30, 2004 have been so
incorporated in reliance on the report of PricewaterhouseCoopers LLP, an
independent registered public accounting firm, given on the authority of said
firm as experts in auditing and accounting.
LEGAL OPINION
Morgan, Lewis & Bockius LLP will issue an opinion about the legality of the debt
securities on our behalf. Any underwriters will be advised about the legality of
the debt securities by their own legal counsel.
17
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Filing fee for registration statement....................... $14,713
Pennsylvania Public Utility Commission filing fee........... 350
Rating agencies' fees....................................... 20,000
Legal fees and expenses..................................... 150,000
Accounting fees and expenses................................ 40,000
Trustees' fees and expenses................................. 10,000
Printing.................................................... 25,000
Blue sky fees and expenses.................................. 5,000
Miscellaneous............................................... 4,937
--------
Total.......................................................$270,000
- ----------
* The foregoing expenses, except filing fee for registration statement, are
estimates.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1741 of the Pennsylvania Business Corporation Law of 1988 provides
that a business corporation may indemnify directors and officers against any
threatened, pending or completed action or proceeding, provided that the person
in question acted in good faith and in a manner he or she reasonably believed to
be in, or not opposed to, the best interests of the corporation and, with
respect to any criminal proceeding, had no reasonable cause to believe his or
her conduct was unlawful. Section 1742 provides, however, that a business
corporation may indemnify its directors and officers only against expenses
(including attorneys' fees) if the action or proceeding is by or in the right of
the corporation. In addition, Section 1742 states that indemnification shall not
be made if the person has been adjudged to be liable to the corporation unless
it is judicially determined that, despite the adjudication of liability but in
view of all of the circumstances of the case, the person is fairly and
reasonably entitled to indemnification for certain expenses. Section 1743
requires a corporation to indemnify its directors and officers against expenses
they may incur in defending actions against them in such capacities if they are
successful on the merits or otherwise in the defense of such actions.
Section 1713 of the Business Corporation Law permits the shareholders to
adopt a bylaw provision relieving a director (but not an officer) of personal
liability for monetary damages except where (i) the director has breached the
applicable standard of care, and (ii) such conduct constitutes self-dealing,
willful misconduct or recklessness. This section also provides that a director
may not be relieved of liability for the payment of taxes pursuant to any
federal, state or local law or of responsibility under a criminal statute.
Article VIII of the Company's Articles and Section 4.01 of the Company's Bylaws
limits the liability of any director to the fullest extent permitted by Section
1713 of the Business Corporation Law.
18
Section 1746 of the Business Corporation Law grants a corporation broad
authority to indemnify its directors, officers and other agents for liabilities
and expenses incurred in such capacity, except in circumstances where the act or
failure to act giving rise to the claim for indemnification is determined by a
court to have constituted willful misconduct or recklessness. Articles VII and
IX of the Company's Bylaws provides for indemnification of directors, officers
and other agents to the extent otherwise permitted by Section 1741 of the
Business Corporation Law and pursuant to the authority of Section 1746 of the
Business Corporation Law.
Subject only to the express prohibitions under the Pennsylvania Business
Corporation Law of 1988, Article IX of the Company's Bylaws provides an
unconditional right to indemnification for expenses and any liability paid or
incurred by any director or officer of the Company, or any other person
designated by the Board of Directors as an indemnified representative, in
connection with any actual or threatened claim, action, suit or proceeding
(including derivative suits) in which he or she may be involved by reason of
being or having been a director, officer, employee or agent of the Company, or
at the request of the Company, of another corporation, partnership, joint
venture, trust, employee benefit plan or other entity. The Bylaws specifically
authorize indemnification against both judgments and amounts paid in settlement
of derivative suits, unlike Section 1742 of the Business Corporation Law which
authorizes indemnification only of expenses incurred in defending a derivative
or corporate action. Article IX of the Bylaws also allows indemnification for
punitive damages and liabilities incurred under federal securities laws.
Unlike the provisions of Business Corporation Law Section 1744, Article IX
does not require the Company to determine the availability of indemnification by
first following certain prescribed procedures. A person who has incurred an
indemnifiable expense or liability has a right to be indemnified independent of
any procedures or determinations that otherwise would be required, and that
right is enforceable against the Company as long as indemnification is not
prohibited by law. To the extent indemnification is permitted only for a portion
of a liability, the Bylaw provisions require the Company to indemnify such
portion. If the indemnification provided for in Article IX is unavailable for
any reason in respect of any liability or portion thereof, the Bylaws require
the Company to make a contribution toward the liability. Indemnification rights
under the Bylaws do not depend upon the approval of any future Board of
Directors.
Section 9.04 of the Company's Bylaws authorizes the Company to further
effect or secure its indemnification obligations by entering into
indemnification agreements, maintaining insurance, creating a trust fund,
granting a security interest in its assets or property, establishing a letter of
credit or using any other means that may be available from time to time.
Article VIII of the Company's Articles limits the personal liability of
officers to the Company to the same extent that directors are relieved of such
liabilities pursuant to that Article and Section 4.01 of the Bylaws, with the
exception that the limitation of the liability of officers applies only to
liabilities arising out of derivative claims by shareholders asserting a right
of the Company and not to liabilities arising out of third party claims.
19
The Company maintains, on behalf of its directors and officers, insurance
protection against certain liabilities arising out of the discharge of their
duties, as well as insurance covering the Company for indemnification payments
made to its directors and officers for certain liabilities. The premiums for
such insurance are paid by the Company.
ITEM 16. EXHIBITS
- ------------ ---------------------------------------------------------------
EXHIBIT NO. DESCRIPTION
3 Amended and Restated Articles of Incorporation (incorporated by
reference from Exhibit 3 of Registration Statement on Form S-3
filed on 10/31/01 (File No. 333-72540)).
4(b) Indenture dated as of August 1, 1993 between the Company and
Wachovia Bank, National Association, formerly First Union
National Bank, formerly First Fidelity Bank, N.A. Pennsylvania
(incorporated by reference to Exhibit 4(c) of Registration
Statement on Form S-3 filed on April 8, 1994 (File No.
33-77514)).
5 Opinion of Morgan, Lewis & Bockius, LLP
12 Statement re computation of ratio of earnings to fixed charges
23(a) Consent of Morgan, Lewis & Bockius, LLP (included in opinion
filed as Exhibit 5).
23(b) Consent of PricewaterhouseCoopers LLP
24 Power of Attorney (included on signature page)
25 Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939, as amended, with respect to the
Trustee.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
20
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more
than a 20 percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8, and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification by the Company for liabilities arising
under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
21
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
22
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in King of Prussia, Pennsylvania, on the 26th day of April, 2005.
UGI Utilities, Inc.
By: /s/ John C. Barney
--------------------------------------
John C. Barney
Senior Vice President - Finance
and Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated. Each person whose signature appears below hereby authorizes
Robert H. Knauss and Robert W. Krick to execute and file, in the name of and as
attorney-in-fact for such person, any amendments or post-effective amendments to
this registration statement as the registrant deems appropriate.
SIGNATURE TITLE DATE
/s/ David W. Trego
President and Chief Executive April 26, 2005
- ------------------------------ Officer and Director (Principal
David W. Trego Executive Officer)
/s/ Lon R. Greenberg
Chairman of the Board and April 26, 2005
- ------------------------------ Director
Lon R. Greenberg
/s/ John L. Walsh
Vice Chairman of the Board and April 26, 2005
- ------------------------------ Director
John L. Walsh
/s/ John C. Barney
Senior Vice President - Finance April 26, 2005
- ------------------------------ (Principal Financial Officer and
John C. Barney Principal Accounting Officer)
/s/ Stephen D. Ban
Director April 26, 2005
- ------------------------------
Stephen D. Ban
/s/ Thomas F. Donovan
Director April 26, 2005
- ------------------------------
Thomas F. Donovan
23
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated. Each person whose signature appears below hereby authorizes
Robert H. Knauss and Robert W. Krick to execute and file, in the name of and as
attorney-in-fact for such person, any amendments or post-effective amendments to
this registration statement as the registrant deems appropriate.
SIGNATURE TITLE DATE
/s/ Ernest E. Jones
Director April 26, 2005
- ------------------------------
Ernest E. Jones
/s/ Richard C. Gozon
Director April 26, 2005
- ------------------------------
Richard C. Gozon
/s/ Anne Pol
Director April 26, 2005
- ------------------------------
Anne Pol
/s/ Marvin O. Schlanger
Director April 26, 2005
- ------------------------------
Marvin O. Schlanger
/s/ James W. Stratton
Director April 26, 2005
- ------------------------------
James W. Stratton
24
EXHIBIT INDEX
- ----------- ---------------------------------------------------------------- --------------
EXHIBIT NO. DESCRIPTION SEQUENTIAL
PAGE NUMBER
3.1 Amended and Restated Articles of
Incorporation (incorporated by reference from Exhibit 3 of
Registration Statement on Form S-3 filed on 10/31/01 (File No.
333-72540)).
4(b) Indenture dated as of August 1, 1993 between the Company and
Wachovia Bank, National Association, formerly First Union
National Bank, and prior to that First Fidelity Bank, N.A.
Pennsylvania (incorporated by reference to Registration
Statement on Form S-3 filed on April 8, 1994 (File No.
33-77514)).
5 Opinion of Morgan, Lewis & Bockius, LLP
12 Statement re computation of ratio of earnings to fixed charges
23(a) Consent of Morgan, Lewis & Bockius, LLP (included in opinion
filed as Exhibit 5).
23(b) Consent of PricewaterhouseCoopers LLP
24 Power of Attorney (included on signature page)
25 Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939, as amended, with respect to the
Trustee.
25