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EXHIBIT 1(f)
OFFER TO EXCHANGE
FIRST MORTGAGE BONDS, 6.86% SERIES A DUE 2008
FOR ALL OUTSTANDING FIRST MORTGAGE BONDS, 6.86% SERIES DUE 2008
$125 MILLION AGGREGATE PRINCIPAL AMOUNT OUTSTANDING
OF
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
To Our Clients:
Enclosed for your consideration are the Prospectus dated , 1999 (the
"Prospectus") and the related Letter of Transmittal and instructions thereto
(the "Letter of Transmittal") in connection with the offer by The Cleveland
Electric Illuminating Company (the "Company") to exchange (the "Exchange Offer")
its First Mortgage Bonds, 6.86% Series A due 2008 (the "New Bonds") for all
outstanding First Mortgage Bonds, 6.86% Series due 2008, (the "Old Bonds" and,
together with the New Bonds, the "Bonds"), upon the terms and conditions set
forth in the Prospectus and Letter of Transmittal.
WE ARE THE REGISTERED HOLDER (THE "REGISTERED HOLDER") OF OLD BONDS
HELD FOR YOUR ACCOUNT. AN EXCHANGE OF THE OLD BONDS CAN BE MADE ONLY BY US AS
THE REGISTERED HOLDER AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF
TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY
YOU TO EXCHANGE THE OLD BONDS HELD BY US FOR YOUR ACCOUNT. THE PROSPECTUS AND
RELATED LETTER OF TRANSMITTAL ALSO PROVIDE A PROCEDURE FOR HOLDERS TO TENDER
THEIR OLD BONDS BY MEANS OF GUARANTEED DELIVERY.
We request information as to whether you wish us to exchange any or all
of the Old Bonds held by us for your account upon the terms and subject to the
conditions of the Exchange Offer. We urge you to read carefully the Prospectus
and the Letter of Transmittal before instructing us to tender your Old Bonds.
Your instructions to us should be forwarded as promptly as possible in
order to permit us to tender Old Bonds on your behalf in accordance with the
provisions of the Exchange Offer. THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON , , 1999 UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION
DATE"). Old Bonds tendered pursuant to the Exchange Offer may only be withdrawn
under the circumstances described in the Prospectus and the Letter of
Transmittal.
Your attention is directed to the following:
1. The New Bonds will be exchanged for the Old Bonds at the rate
of $1,000 principal amount of New Bonds for each $1,000 principal
amount of Old Bonds. There will be no loss of interest income to
holders of Old Bonds whose Old Bonds are accepted for exchange, as more
fully explained in the Prospectus. The form and terms of the New Bonds
are identical in all material respects to the form and terms of the Old
Bonds, except that the New Bonds have been registered under the
Securities Act of 1933, as amended (the "Securities Act"). Following
completion of the Exchange Offer and during the effectiveness of any
required Shelf Registration Statement, none of the Bonds will be
entitled to the benefits of the Registration Agreement (as defined in
the Prospectus) relating to a contingent increase in the interest rate
borne by the Bonds under certain circumstances.
2. Based on an interpretation of the Securities and Exchange
Commission (the "Commission"), New Bonds issued pursuant to the
Exchange Offer in exchange for Old Bonds may be offered for resale,
resold and otherwise transferred by holders thereof (other than (i) a
broker-dealer who purchased Old Bonds directly from the Company for
resale pursuant to Rule 144A or any other available exemption under the
Securities Act or (ii) a person that is an "affiliate" of the Company
within the meaning of Rule 405 under the Securities Act) without
compliance with the registration and prospectus delivery provisions of
the Securities Act, provided that the holder is acquiring the New Bonds
in its ordinary course of business and is not participating, and has no
arrangement or understanding with any person to participate, in the
distribution of the New Bonds. Holders of Old Bonds wishing to accept
the Exchange Offer must represent to the Company that such conditions
have been met.
3. THE EXCHANGE OFFER IS NOT CONDITIONED ON ANY MINIMUM PRINCIPAL
AMOUNT OF OLD BONDS BEING TENDERED.
4. Notwithstanding any other term of the Exchange Offer, the
Company may terminate or amend the Exchange Offer as provided in the
Prospectus and will not be required to accept for exchange, or exchange
New Bonds for, any Old Bonds not accepted for exchange prior to such
termination.
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5. The Exchange Offer will expire at 5:00 p.m., New York City
time, on , , 1999 unless the Exchange Offer is extended (the
"Expiration Date"). Tendered Old Bonds may be withdrawn, subject to the
procedures described in the Prospectus, at any time prior to 5:00 p.m.,
New York City time, on the Expiration Date if such Old Bonds have not
previously been accepted for exchange pursuant to the Exchange Offer.
6. Any transfer taxes applicable to the exchange of the Old Bonds
pursuant to the Exchange Offer will be paid by the Company, except as
otherwise provided in Instruction 5 of the Letter of Transmittal.
7. Tendering holders may withdraw their tender at any time until
the Expiration Date.
8. The acceptance for exchange of Old Bonds validly tendered and
not validly withdrawn and the issuance of New Bonds will be made as
promptly as practicable after the Expiration Date. Subject to rules
promulgated pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the Company, however, expressly reserves the
right to delay acceptance of any of the Old Bonds or to terminate the
Exchange Offer and not accept for purchase any Old Bonds not
theretofore accepted if any of the conditions set forth in the
Prospectus under the caption "The Exchange Offer -- Termination" shall
not have been satisfied or waived by the Company.
9. The Company expressly reserves the right, in its sole
discretion, (i) to amend the terms of the Exchange Offer or (ii) to
terminate the Exchange Offer. Any delay, extension, amendment or
termination will be followed as promptly as practicable by oral or
written notice to the Exchange Agent and a public announcement thereof.
In the case of an extension, such public announcement shall include
disclosure of the approximate number of Old Bonds deposited to date and
shall be made prior to 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date.
10. Consummation of the Exchange Offer may have adverse
consequences to non-tendering Old Bond holders, including that the
reduced amount of outstanding Old Bonds as a result of the Exchange
Offer may adversely affect the trading market, liquidity and market
price of the Old Bonds.
If you wish to have us tender any or all of your Old Bonds, please so
instruct us by completing, detaching and returning to us the instruction form
attached hereto. An envelope to return your instructions is enclosed. If you
authorize a tender of your Old Bonds, the entire principal amount of Old Bonds
held for your account will be tendered unless otherwise specified on the
instruction form. Your instructions should be forwarded to us in ample time to
permit us to submit a tender on your behalf by the Expiration Date.
THE EXCHANGE OFFER IS NOT BE MADE TO, NOR WILL TENDERS BE ACCEPTED FROM
OR ON BEHALF OF, HOLDERS OF THE OLD BONDS IN ANY JURISDICTION IN WHICH THE
MAKING OF THE EXCHANGE OFFER OR ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE
WITH THE LAWS OF SUCH JURISDICTION OR WOULD OTHERWISE NOT BE IN COMPLIANCE WITH
ANY PROVISION OF ANY APPLICABLE SECURITIES LAW.
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OFFER TO EXCHANGE
FIRST MORTGAGE BONDS, 6.86% SERIES A DUE 2008
FOR ALL OUTSTANDING FIRST MORTGAGE BONDS, 6.86% SERIES DUE 2008
$125 MILLION AGGREGATE PRINCIPAL AMOUNT OUTSTANDING
OF
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
The undersigned acknowledge(s) receipt of your letter and the enclosed
Prospectus and the related Letter of Transmittal, in connection with the offer
by the Company to exchange the Old Bonds for the New Bonds.
This will instruct you to tender the principal amount of Old Bonds
indicated below held by you for the account of the undersigned, upon the terms
and subject to the conditions set forth in the Prospectus and the related Letter
of Transmittal, and the undersigned hereby makes the applicable representations
set forth in such Letter of Transmittal.
SIGN HERE
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Signature
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Signature
[ ] Please tender the Old Bonds held by you for my account,
as indicated below.
[ ] Please do not tender any Old Bonds held by you for my
account.
Principal Amount*
of Old Bonds to be Tendered: $______________ (must be in the
principal amount of $1,000 or an integral multiple thereof)
[ ]
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Name(s) (Please Print)
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Address
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Zip Code
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Area Code and Telephone Number
Dated: , 1999
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* Unless otherwise indicated, it will be assumed that all of the securities
listed are to be tendered.