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U.S. Code as of:
01/19/04
Section 824c. Issuance of securities; assumption of liabilities
(a) Authorization by Commission
No public utility shall issue any security, or assume any
obligation or liability as guarantor, indorser, surety, or
otherwise in respect of any security of another person, unless and
until, and then only to the extent that, upon application by the
public utility, the Commission by order authorizes such issue or
assumption of liability. The Commission shall make such order only
if it finds that such issue or assumption (a) is for some lawful
object, within the corporate purposes of the applicant and
compatible with the public interest, which is necessary or
appropriate for or consistent with the proper performance by the
applicant of service as a public utility and which will not impair
its ability to perform that service, and (b) is reasonably
necessary or appropriate for such purposes. The provisions of this
section shall be effective six months after August 26, 1935.
(b) Application approval or modification; supplemental orders
The Commission, after opportunity for hearing, may grant any
application under this section in whole or in part, and with such
modifications and upon such terms and conditions as it may find
necessary or appropriate, and may from time to time, after
opportunity for hearing and for good cause shown, make such
supplemental orders in the premises as it may find necessary or
appropriate, and may by any such supplemental order modify the
provisions of any previous order as to the particular purposes,
uses, and extent to which, or the conditions under which, any
security so theretofore authorized or the proceeds thereof may be
applied, subject always to the requirements of subsection (a) of
this section.
(c) Compliance with order of Commission
No public utility shall, without the consent of the Commission,
apply any security or any proceeds thereof to any purpose not
specified in the Commission's order, or supplemental order, or to
any purpose in excess of the amount allowed for such purpose in
such order, or otherwise in contravention of such order.
(d) Authorization of capitalization not to exceed amount paid
The Commission shall not authorize the capitalization of the
right to be a corporation or of any franchise, permit, or contract
for consolidation, merger, or lease in excess of the amount
(exclusive of any tax or annual charge) actually paid as the
consideration for such right, franchise, permit, or contract.
(e) Notes or drafts maturing less than one year after issuance
Subsection (a) of this section shall not apply to the issue or
renewal of, or assumption of liability on, a note or draft maturing
not more than one year after the date of such issue, renewal, or
assumption of liability, and aggregating (together with all other
then outstanding notes and drafts of a maturity of one year or less
on which such public utility is primarily or secondarily liable)
not more than 5 per centum of the par value of the other securities
of the public utility then outstanding. In the case of securities
having no par value, the par value for the purpose of this
subsection shall be the fair market value as of the date of issue.
Within ten days after any such issue, renewal, or assumption of
liability, the public utility shall file with the Commission a
certificate of notification, in such form as may be prescribed by
the Commission, setting forth such matters as the Commission shall
by regulation require.
(f) Public utility securities regulated by State not affected
The provisions of this section shall not extend to a public
utility organized and operating in a State under the laws of which
its security issues are regulated by a State commission.
(g) Guarantee or obligation on part of United States
Nothing in this section shall be construed to imply any guarantee
or obligation on the part of the United States in respect of any
securities to which the provisions of this section relate.
(h) Filing duplicate reports with the Securities and Exchange
Commission
Any public utility whose security issues are approved by the
Commission under this section may file with the Securities and
Exchange Commission duplicate copies of reports filed with the
Federal Power Commission in lieu of the reports, information, and
documents required under sections 77g, 78l, and 78m of title 15.
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