| As filed with the Securities and Exchange Commission on December 12, 2008 |
| Registration No. 333-____________ |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION ON AUGUST 8, 1995
REGISTRATION NO. 33-60441
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
Washington, D.C. 20549
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AMENDMENT NO. 1
TO
____________________________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SOUTHERN CALIFORNIA
____________________________________
GOLDEN STATE WATER COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
CALIFORNIA
(STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION)
95-1243678
(I.R.S. EMPLOYER
IDENTIFICATION NO.)
(Exact name of Registrant as specified in its charter)
| California | 95-1243678 |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification Number) |
____________________________________
630 EAST FOOTHILL BOULEVARD
SAN DIMAS, CALIFORNIAEast Foothill Boulevard
San Dimas, California 91773
(909) 394-3600
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
PRINCIPAL EXECUTIVE OFFICES)
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JAMES B. GALLAGHER
VICE PRESIDENT-FINANCE,
CHIEF FINANCIAL OFFICER AND SECRETARY
SOUTHERN CALIFORNIA WATER COMPANY
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
____________________________________
Robert J. Sprowls
Executive Vice President
630 EAST FOOTHILL BOULEVARD
SAN DIMAS, CALIFORNIAEast Foothill Boulevard
San Dimas, California 91773
(909) 394-3600
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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IT IS RESPECTFULLY REQUESTED THAT THE COMMISSION SEND COPIES OF ALL NOTICES,
ORDERS AND COMMUNICATIONS
(Name, Address, including zip code, and telephone number, including area code, of Agent for Service)
COPY TO:
C. JAMES LEVIN, ESQ.
O'MELVENY
C.J. Levin, Esq.
O’Melveny & MYERS
Myers LLP
400 SOUTH HOPE STREET
LOS ANGELES, CALIFORNIA 90071-2899
GARY W. WOLF, ESQ.
CAHILL GORDON & REINDEL
EIGHTY PINE STREET
NEW YORK, NEW YORK 10005-1702
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALES TO THE PUBLIC:
South Hope Street
Los Angeles, CA 90071
(213) 430-6000
____________________________________
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.
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becomes effective
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. / /o
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, check the following box. /X/x
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, of 1933, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, of 1933, check the following box and list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /o
If delivery ofthis Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the prospectus is expected to be madeCommission pursuant to Rule 434,
please462(e) of the Securities Act, check the following box. / /
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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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED AUGUST 8, 1995
PROSPECTUS
SOUTHERN CALIFORNIA WATER COMPANY
SECURITIES
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Southern California Water Company (the "Company") may offer from timebox
If this Form is a post-effective amendment to time, in onea registration statement filed pursuant to General Instruction I.D. filed to register additional securities or more series, its unsecured debtadditional classes of securities (the "Debt
Securities"), and shares of its Common Shares, par value $2.50 per share (the
"Common Shares"). The Debt Securities and the Common Shares are collectively
referredpursuant to herein as the "Securities." The Securities will have an aggregate
offering price not exceeding $70,000,000 and will be offered on terms to be
determined at the time of offering.
In the case of Debt Securities, the specific title, the aggregate principal
amount, the purchase price, the maturity, the rate and time of payment of any
interest, any redemption or sinking fund provisions, any conversion provisions
and any other specific terms of the Debt Securities will be set forth in an
accompanying supplement to this Prospectus (a "Prospectus Supplement"). In the
case of Common Shares, the specific number of shares and issuance price per
share will be set forth in an accompanying Prospectus Supplement. Unless
otherwise disclosed in the applicable Prospectus Supplement, the Common Shares
will be listed on the New York Stock Exchange under the symbol "SCW."
Securities may be sold directly, through agents from time to time or
through underwriters and/or dealers. If any agent of the Company or any
underwriter is involved in the saleRule 413(b) of the Securities Act, check the namefollowing box o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of such agent or
underwriter“large accelerated filer,” “accelerated filer,” and any applicable commission or discount will be set forth“smaller reporting company” in the
accompanying Prospectus Supplement. See "Plan of Distribution."
The Debt Securities, if issued, will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company. See "Description of
Debt Securities."
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
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THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
THE DATE OF THIS PROSPECTUS IS , 1995.
3
AVAILABLE INFORMATION
The Company is subject to the informational requirementsRule 12b-2 of the Securities Exchange Act of 1934, as amended,amended. (Check one):
| Large accelerated filer o | Accelerated filer o |
| Non-accelerated x | Smaller reporting company o |
| (Do not check if a smaller reporting company) | |
CALCULATION OF REGISTRATION FEE
| Proposed maximum | Amount of | |||
| Title of each class of | Amount to be | Proposed maximum | aggregate offering | registration |
| securities to be registered | registered | offering price per unit | price | fee(2) |
| Debt Securities | N.A. | N.A. | $100,000,000(1) | $3,930 |
| (1) | In no event will the aggregate maximum offering price of all securities issued pursuant to this Registration Statement exceed $100,000,000 or, if any debt securities are issued with original issue discount, such greater amount as shall result in an aggregate offering price of $100,000,000. | ||||
| (2) | An indeterminate amount of debt securities to be offered is being registered pursuant to this registration statement as permitted by Rule 457(o). | ||||
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 Commission, acting pursuant to Section 8(a), may determine. | |||||
The information in this prospectus is not complete and in accordance therewith, files reports,
proxy statements and other informationmay be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statementsis effective. This prospectus is not an offer to sell these securities and other
information can be inspected and copied at Room 1024it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
Subject to Completion, dated December 12, 2008
Prospectus
GOLDEN STATE WATER COMPANY
$100,000,000
DEBT SECURITIES
We may from time to time offer the debt securities described in this prospectus. This prospectus provides you with a general description of the officesdebt securities we may offer. We will provide you with the specific terms of each offering in supplements to this prospectus. We may also supplement, update or amend information contained in this prospectus.
The debt securities we may offer will be a new issue with no established trading market. If we decide to seek listing of any of these debt securities upon issuance, we will disclose the Commission, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549,exchange, quotation system or market on which these debt securities will be listed in a prospectus supplement.
We may sell debt securities directly to you or through underwriters, dealers or agents. The names of any underwriters, dealers or agents involved in the sale of any debt securities and shouldthe specific manner in which they may be available for inspection and copying at the regional offices of the
Commission located at 7 World Trade Center, 13th Floor, New York, New York 10048
and Suite 1400, Northwestern Atrium Center, 500 West Madison Street, Chicago,
Illinois 60661. Copies of such material canoffered will be obtained from the principal
offices of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The issued and outstanding Common
Shares of the Company are listed on the New York Stock Exchange, and such
reports, proxy statements and other information can also be inspected at such
Exchange.
This Prospectus does not contain all the information set forth in the Registration Statement and exhibits thereto whichprospectus supplement covering the Company has filed withsale of those debt securities.
Investing in our securities involves risks. Before buying any debt securities, you should carefully read the Commissiondiscussion of material risks involved in investing in our securities under the Securities Act of 1933 and reference is hereby made to such
Registration Statement, including the exhibits thereto.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following documents of the
Company filed with the Commission (file no. 0-1121): (1) Annual Reportheading “Risk Factors” beginning on Form
10-K for the fiscal year ended December 31, 1994; (2) Quarterly Report on Form
10-Q for the quarter ended March 31, 1995; (3) Amendment No. 1 to Quarterly
Report on Form 10-Q/A for the quarter ended March 31, 1995; (4) Quarterly Report
on Form 10-Q for the quarter ended June 30, 1995; and (5) all documents filed by
the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) ofpage 1.
Neither the Securities and Exchange ActCommission nor any state securities commission has approved or disapproved of 1934, as amended, subsequentthese securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
This prospectus is not an offer to sell our debt securities and we are not soliciting an offer to buy our debt securities in any jurisdiction where the offer or sale is not permitted.
The date of this Prospectus and
priorprospectus is
TABLE OF CONTENTS
| Page | ||
| About This Prospectus | 1 | |
| Our Company | 1 | |
| RISK FACTORS | 1 | |
| Cautionary Note About Forward-Looking Statements | 7 | |
| Use of Proceeds | 8 | |
| Ratio of Earnings to Fixed Charges | 8 | |
| Description of Debt Securities | 8 | |
| Global Securities | 12 | |
| Plan of Distribution | 15 | |
| Legal Matters | 18 | |
| Experts | 18 | |
| Where You Can Find More Information | 18 | |
| Incorporation of Documents By Reference | 19 |
You should rely only on the termination of the offering of the Securities.
Any statementinformation contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
in a Prospectus Supplement or in any subsequently filed document which is
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial holder, to whom a copy of this Prospectus is delivered, upon the
written or oral request of any such person, a copy of any or all the foregoing
documents incorporated by reference herein, including exhibits specifically incorporated by reference in such documents but excluding allthis prospectus and in any prospectus supplement accompanying this prospectus. No dealer, salesperson or other exhibitsperson is authorized to such documents. Requests should be madegive information that is different. This prospectus is not an offer to Southern California Water Company,
630 East Foothill Boulevard, San Dimas, California 91773 (Telephone: (909)
394-3600), Attention: Officesell nor is it seeking an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus or in any prospectus supplement is correct only as of the Treasurer.
THEdate on the front of those documents, regardless of the time of the delivery of this prospectus or any prospectus supplement or any sale of these securities.
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, using the shelf registration process. Under this process, we may sell up to $100,000,000 of the securities described in this prospectus in one or more offerings over the next several years.
This prospectus provides you with a general description of the debt securities we may offer. Each time we sell debt securities, we will provide you with a supplement to this prospectus that will describe the specific amounts, prices and terms of the debt securities for that offering. The prospectus supplement may also add, update or change information contained in this prospectus. Although we will try to include all information that we believe may be material to investors, certain details that may be important to you may have been excluded. To see more detail, you should read the exhibits filed by us with the registration statement or other SEC filings.
We also periodically file with the SEC documents that include information about our financial statements and our company, including information on matters that might affect our future financial results. Directions on how you may get our documents are provided on page 18. It is important for you to read these documents, this prospectus and the applicable prospectus supplement before you invest.
OUR COMPANY
The Company is a public utility regulated
We provide water service to more than 75 communities and 10 counties in California and electric service in the City of Big Bear Lake and surrounding communities in San Bernardino County, California. We are subject to regulation by the California Public Utilities Commission (the "CPUC"). The Companyor CPUC.
Our principal executive office is engaged in the purchase,
production, distribution and sale of water and in the purchase, distribution and
sale of electricity.
The Company was incorporated in California in 1929. Its executive offices
are located at 630 East Foothill Boulevard,Blvd., San Dimas, California 91773 and itsour telephone number is (909) 394-3600.
USE OF PROCEEDS909-394-3600.
RISK FACTORS
You should carefully read the risks described below, other information in this prospectus and in documents we incorporate by reference in order to understand certain of the risks of our business.
Our business is heavily regulated and, as a result, decisions by regulatory agencies and changes in laws and regulations can significantly affect our business
Our revenues depend substantially on the rates and fees we charge our customers and the ability to recover our costs on a timely basis, including the ability to recover the costs of purchased water, groundwater assessments, electric power, natural gas, chemicals, water treatment, security at water facilities and preventative maintenance and emergency repairs. Any delays by the CPUC in granting rate relief to cover increased operating and capital costs may adversely affect our financial performance. We may file for interim rates in situations where there may be delays in granting final rate relief. If the CPUC approves lower rates, the CPUC will require us to refund to customers the difference between the interim rates and the rates approved by the CPUC.
Regulatory decisions may also impact prospective revenues and earnings, affect the timing of the recognition of revenues and expenses and may overturn past decisions used in determining our revenues and expenses. Management continually evaluates the anticipated recovery of regulatory assets, liabilities, and revenues subject to refund and provides for allowances and/or reserves as deemed necessary. In the event that our assessment of the probability of recovery through the ratemaking process is incorrect, we will adjust the associated regulatory asset or liability to reflect the change in our assessment or any regulatory disallowances. A change in our evaluation of the probability of recovery of regulatory assets or a regulatory disallowance of all or a portion of our costs could have a material adverse effect on our financial results.
We are also in some cases required to estimate future expenses and in others, we are required to incur the expense before recovering costs. As a result, our revenues and earnings may fluctuate depending on the accuracy of our estimates, timing of our investments or expenses or other factors. If expenses increase significantly over a short period of time, we may experience delays in recovery of these expenses, the inability to recover carrying costs for these expenses and increased risks of regulatory disallowances or write-offs.
The CompanyCPUC and other regulatory agencies may also change their rules and policies which may adversely affect our profitability and cash flows.
We may also be subject to fines or penalties if a regulatory agency determines that we have failed to comply with laws, regulations or orders applicable to our business, unless we appeal this determination or our appeal of an adverse determination is denied.
Our earnings are greatly affected by weather during different seasons
The demand for water and electricity varies by season. Therefore, the results of operations for one period may not indicate results to be expected in another period. For instance, most water consumption occurs during the third quarter of each year when weather tends to be hot and dry. During this period, revenues and profitability are usually higher than in other quarters. Drought or unusually wet conditions may also adversely impact our revenues and profitability. During a drought, we may experience both lower revenue due to consumer conservation efforts and higher water and operating costs due to supply shortages. During unusually wet weather, our customers generally use less water. In November 2008, we implemented a new conservation rate design which should help mitigate fluctuations in revenues and earnings due to changes in water consumption.
The demand for electricity in our electric customer service area is greatly affected by winter snows. An increase in winter snows reduces the use of snowmaking machines at ski resorts in the Big Bear area and, as a result, reduces our electric revenues. Likewise, unseasonably warm weather during a skiing season may result in temperatures too high for snowmaking conditions, which also reduces our electric revenues.
Our liquidity and earnings may be adversely affected by changes in water supply costs
We obtain our water supplies from a variety of sources. For example, water is pumped from aquifers within our service areas to meet a portion of the demands of our customers. When water produced from wells is insufficient to meet customer demand or when such production is interrupted, we have purchased water from other suppliers. As a result, our cost of providing, distributing and treating water for our customers’ use can vary significantly. Furthermore, imported water wholesalers, such as the Metropolitan Water District of Southern California, or MWD, may not always have an adequate supply of water to sell to us.
We have established water supply cost balancing accounts for expenses of purchased water, purchased power and groundwater related pump taxes for our water service areas. Even under the water supply cost balancing account procedures, changes in water supply costs, such as those that occur due to changes in supply mix (purchased water volume vs. pumped water, for instance) compared to the authorized amount historically directly affected our earnings. In November 2008, we implemented a modified balancing account that permits us to reflect changes in all water supply costs, including those due to changes in water supply mix, in the balancing account.
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Our liquidity and earnings could be adversely affected by increases in maintenance costs due to our aging infrastructure
Some of our systems are more than 50 years old. We are experiencing a high number of leaks, water quality and mechanical problems in some of these systems. In addition, well and pump maintenance expenses continue to increase due to rising labor and material costs and more stringent water discharge requirements. These costs can and do increase unexpectedly and in substantial amounts.
We include increases in maintenance costs in each general rate case for possible recovery. However, we estimate the amount of expenses expected to be incurred during future years. We may not recover overages from those estimates in rates, which may adversely affect our financial condition, results of operations, cash flow and liquidity.
Our liquidity and earnings may be adversely affected by our conservation efforts
Conservation by all customer classes is a top priority. However, customer conservation can result in lower volumes of water sold. We are also experiencing a decline in per residential customer water usage due to the use of more efficient household fixtures and appliances by residential consumers and a decline in household sizes.
We are heavily dependent upon revenue generated from rates charged to our residential customers for the volume of water used. The rates we charge for water are regulated by the CPUC and may not be unilaterally adjusted to reflect changes in demand. Declining usage also negatively impacts our long-term operating revenues if we are unable to secure rate increases or if growth in the residential customer base does not occur to the extent necessary to offset the per customer residential usage decline. In November 2008, we implemented a water revenue adjustment mechanism which decouples sales in order to reduce the adverse impacts of our customers’ conservation efforts.
Our operating costs have increased and are expected to continue to increase as a result of groundwater contamination
Our operations are impacted by groundwater contamination in certain service territories. We have taken a number of steps to address contamination, including the removal of wells from service, decreasing the amount of groundwater pumped from wells in order to slow the movement of plumes of contaminated water, constructing water treatment facilities and securing alternative sources of supply from other areas not affected by the contamination.
In some cases, potentially responsible parties have reimbursed us for our costs. In other cases, we have taken legal action against parties believed to be potentially responsible for the contamination. To date, the CPUC has permitted us to establish memorandum accounts in California for potential recovery of these types of costs. As a result, our memorandum and water supply balancing accounts are high by historical standards. We can give no assurance regarding the outcome of litigation arising out of contamination or our ability to recover these costs in the future.
Persons who are potentially responsible for causing the contamination of groundwater supplies have also been increasingly asserting claims against water distributors on a variety of theories and have thus far brought the water distributors (including us) within the class of potentially responsible parties in federal court actions pending in Los Angeles County. This increases the costs and risks of seeking recovery of these costs. Management believes that rate recovery, proper insurance coverage and reserves are in place to appropriately manage these types of claims. However, such claims, if ultimately resolved unfavorably to us, could, in the aggregate, have a material adverse effect on our results of operations and financial condition.
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Our costs involved in maintaining water quality and complying with environmental regulation have increased and are expected to continue to increase
Our capital and operating costs have increased substantially as a result of increases in environmental regulation arising from improved detection technology and increases in the cost of disposing of residuals from our water treatment plants, upgrading and building new water treatment plants, monitoring compliance activities and removing our wells from service when necessary to address contamination issues. We may be able to recover these costs through the ratemaking process. In certain circumstances, costs may be recoverable from parties responsible or potentially responsible for contamination, either voluntarily or through specific court action.
We may also incur significant costs in connection with seeking to recover costs due to contamination of water supplies. Our ability to recover these types of costs depends upon a variety of factors, including approval of rate increases, the willingness of potentially responsible parties to settle litigation and otherwise address the contamination and the extent and magnitude of the contamination. We can give no assurance regarding the adequacy of any such recovery to offset the costs associated with the contamination or the cost of recovery of these costs.
The adequacy of our water supplies depends upon a variety of uncontrollable factors
The adequacy of our water supplies varies from year to year depending upon a variety of factors, including:
- Rainfall, runoff, flood control and availability of reservoir storage
- Availability of Colorado River water and imported water from northern California
- The amount of useable water stored in reservoirs and groundwater basins
- The amount of water used by our customers and others
- Water quality
- Legal limitations on production, diversion, storage, conveyance and use
Population growth and increases in the amount of water used have caused increased stress on surface water supplies and groundwater basins. The importation of water from the Colorado River, one of our important sources of supply has decreased due to implementation of the California 4.4 Plan which limits the amount of water that the MWD is entitled to take from the Colorado River. In addition, new court-ordered pumping restrictions on water obtained from the Sacramento-San Joaquin Delta are expected to decrease the amount of water MWD is able to import from northern California. We are cooperating with MWD to secure additional supplies from conservation, desalination and water exchanges with agricultural water users, but it is not known to what extent these efforts will be successful and sustainable.
Water shortages may:
- adversely affect our supply mix, for instance, causing more reliance upon more expensive water sources
- adversely affect our operating costs, for instance, by increasing the cost of producing water from more highly contaminated aquifers
- result in an increase in our capital expenditures, for example by requiring the construction of pipelines to connect to alternative sources of supply, new wells to replace those that are no longer in service or are otherwise inadequate to meet the needs of our customers, and reservoirs and other facilities to conserve or reclaim water
- adversely affect the volume of water sold as a result of mandatory or voluntary conservation efforts by customers
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We may be able to recover increased operating and capital costs through the ratemaking process. We implemented a modified supply cost balancing account to track and recover costs from our supply mix changes, as authorized by the CPUC in November 2008. We may also recover costs from certain third parties that may be responsible, or potentially responsible, for groundwater contamination.
Our liquidity, and in certain circumstances, earnings, may be adversely affected by increases in electricity and natural gas prices in California
We purchase most of our electric energy sold to customers in our electric customer service area from others under purchased power contracts. In addition to purchased power contracts, we purchase additional energy from the spot market to meet peak demand. We may sell surplus power to the spot market during times of reduced energy demand. We also operate a natural gas-fueled 8.4 megawatt generator in our electric service area.
During the energy crisis in late 2000 and 2001, we incurred approximately $23.1 million of additional energy purchase costs that were not covered in rates. The CPUC authorized a surcharge of 2.2¢ per kilowatt hour from our customers through August 2011 to recover this under-collected balance. Based on projected electricity sales, we expect to recover all of this under-collected balance. In addition, the CPUC authorized recovery of energy purchase costs from customers, up to an annual weighted average cost of $77 per MWh each year through August 2011. We are required to write-off costs in excess of this cap. As a result, we are at risk for increases in spot market prices of electricity purchased and for decreases in spot market prices for electricity sold.
Unexpected generator downtime or a failure to perform by any of the counterparties to our electric and natural gas purchase contracts could further increase our exposure to fluctuating natural gas and electric prices.
Changes in electricity prices also affect the unrealized gains and losses on our block forward purchased power contracts that qualify as derivative instruments as we adjust the asset or liability on these contracts to reflect the fair market value of the contracts at the end of each month. These unrealized gains and losses are reflected in earnings. Our only derivative contracts will expire on December 31, 2008.
We have filed an application with the CPUC to review our new purchased power contracts, effective after December 31, 2008, and intend to seek the CPUC’s authorization of a memorandum account to track the changes in the fair market value of the contracts resulting in unrealized gains and losses. If this application is approved, unrealized gains and losses on the new purchased power contracts will not impact earnings.
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Our business requires significant capital expenditures
The utility business is capital intensive. On an annual basis, we spend significant sums of money for additions to, or replacement of, our property, plant and equipment.
We obtain funds for these capital projects from operations, contributions by developers and others and advances from developers (which are repaid over a period of time at no interest). We also periodically borrow money from third parties or our parent or issue equity to our parent for these purposes. Our ability to obtain funds from our parent is dependent upon the ability of our parent to issue debt or equity to third parties. Our parent also has access to a revolving credit facility which may be used, in part, to provide funds to us. We cannot provide assurance that these sources will continue to be adequate or that the cost of funds will remain at levels permitting us to earn a reasonable rate of return.
Our failure to comply with the restrictive covenants in our long-term debt agreements and credit facility could trigger prepayment obligations
Our failure to comply with the restrictive covenants under our long-term debt agreements could result in an event of default, which, if not cured or waived, could result in us being required to repay or refinance (on less favorable terms) these borrowings before their due dates. If we are forced to repay or refinance (on less favorable terms) these borrowings, our results of operations and financial condition could be adversely affected by increased cost and rates.
We may be adversely impacted by the 2008 financial crisis
Due to recent capital market events, there has been a decline in the fair value of the assets in our pension and post-retirement benefit plans since December 31, 2007. This decline in market value may increase our pension and post-retirement benefit plan expenses in 2009 to the extent that this decline in market value continues or is not reversed and is not offset by changes in the discount rate. If market conditions do not improve, we may also need to increase our cash contributions to these plans in 2009.
We obtain funds from external sources to finance our operations. Access to external financing on reasonable terms depends, in part, on conditions in the debt and equity markets. When business and market conditions deteriorate to the extent that we no longer have access to the capital markets on reasonable terms, we may obtain funds from our parent. Our ability to obtain funds from our parent is dependent upon the ability of our parent to access the capital markets by issuing debt or equity to third parties or obtaining funds from its revolving credit facility. If the current financial turmoil continues for an extended period of time, it may become necessary for us to seek funds on unattractive terms.
We are unable to predict eitherat this time how we may otherwise be impacted by the number2008 financial crisis.
Our assets are subject to condemnation
Municipalities and other government subdivisions may, in certain circumstances, seek to acquire certain of Common Shares orour assets through eminent domain proceedings. It is generally our practice to contest these proceedings which may be costly and may divert the amountattention of Debt Securities that will ultimately be sold ormanagement from the prices at which,operation of our business. If a municipality or other terms upongovernment subdivision succeeds in acquiring our assets, there is a risk that we will not receive adequate compensation for the assets acquired or be able to recover all charges associated with divesting these assets.
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Our operations are geographically concentrated in southern California
Our operations are concentrated in southern California. All of our other assets are located in California. As a result, our financial results are largely subject to weather, political, water supply, labor, utility cost, regulatory and other economic risks affecting California.
We operate in areas subject to natural disasters or that may be the target of terrorist activities
We operate in areas that are prone to earthquakes, fires, mudslides and other natural disasters. While we maintain insurance policies to help reduce our financial exposure, a significant seismic event in southern California, where our operations are concentrated, or other natural disaster in California could adversely impact our ability to deliver water and adversely affect our costs of operations. The CPUC has historically allowed utilities to establish a catastrophic event memorandum account as a possible mechanism to recover these costs.
Terrorists could seek to disrupt service to our customers by targeting our assets. We have invested in additional security for facilities throughout our service areas to mitigate the risks of terrorist activities.
CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS
This prospectus, any prospectus supplement, and the documents incorporated herein and therein are forward-looking statements intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding our goals, beliefs, plans or current expectations, taking into account the information currently available to management. Forward-looking statements are not statements of historical facts. For example, when we use words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "may" and other words that convey uncertainty of future events or outcome, we are making forward-looking statements. Such statements address future events and conditions concerning such matters as our ability to raise capital, capital expenditures, earnings, litigation, rates, water sales, water quality and other regulatory matters, adequacy of water supplies, our ability to recover electric, natural gas and water supply costs from ratepayers, liquidity and capital resources and accounting matters. We caution you that any forward-looking statements made by us are not guarantees of future performance and that actual results may differ materially from those in our forward-looking statements as a result of factors such as changes in utility regulation; recovery of regulatory assets not yet included in rates; future economic conditions which suchaffect changes in customer demand and changes in water and energy supply costs and changes in pension and post-retirement benefit plan costs; future climatic conditions; delays in customer payments; potential assessments for failure to meet interim targets for the purchase of renewable energy; and legislative, regulatory and legal proceedings and other circumstances affecting anticipated revenues and costs. Please consider our forward-looking statements in light of those risks as you read this prospectus, any prospectus supplement and the documents incorporated by reference herein or therein.
Additional risks relating to our business, the industries in which we operate or any securities we may offer and sell under this prospectus may be described from time to time in our filings with the Securities will be sold. However,and Exchange Commission.
Except as required by the Company
proposesfederal securities laws, we do not intend, and undertake no obligation, to update our forward-looking statements to reflect new information, future events or circumstances.
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USE OF PROCEEDS
Unless otherwise stated in the applicable prospectus supplement, we will use the net proceeds from the sale of such Securitiesthese debt securities for the
reimbursement of moneys actually expended from income, or from other moneys in
the Company's treasury, for the acquisition of property, for the construction,
completion, extension or improvement of the Company's facilities or for other general corporate purposes. SuchGeneral corporate purposes include funding capital expenditures and purchasing and maintaining plant and equipment. We may temporarily invest the proceeds initially may be usedin short-term securities or use the proceeds to reduce short-term borrowings or may be invested in short-term securities. Such proceedsour borrowings. We may also be useduse the proceeds to refund certain existing debt obligations with maturities in
excessfund acquisitions of one year, in which event such refunded debt obligations will be
specified in an applicable Prospectus Supplement.
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SELECTED FINANCIAL DATA
The following table sets forth selected financial and other data for the
Company and its consolidated subsidiariesbusinesses.
RATIO OF EARNINGS TO FIXED CHARGES
Our ratios of earnings to fixed charges for the periods indicated. Such
information is qualified in its entirety by the more detailed financial
information set forth in the financial statements and the notes thereto
incorporated by reference herein. See "Incorporation of Certain Documents by
Reference."
indicated were:
| For the year ended December 31, | ||||||||||
| 2003 | 2004 | 2005 | 2006 | 2007 | ||||||
| Ratio of earnings to fixed charges(1) | 2.25 | 3.03 | 4.58 | 2.97 | 3.24 | |||||
| (1) | Fixed charges consist of |
Our ratio of earnings to fixed charges for the nine months ended September 30, 2008 was 3.25. We do not have any preferred securities outstanding.
DESCRIPTION OF DEBT SECURITIES
Debt Securities may be issued from time to time in series
We will issue debt securities under an indenture filed with the Indenture, dated as of September 1, 1993 (the "Indenture"), between the Company
and Chemical Trust Company of California, as trustee (the "Trustee"), or such
other trustee as may be designated in a Prospectus Supplement. As used under
this caption, unless the context otherwise requires, "Offered Debt Securities"
shall mean the Debt Securities offered by this Prospectus and the accompanying
Prospectus Supplement. The statements under this caption are brief summaries of
certain provisions contained in the Indenture, do not purport to be complete and
are qualified in their entirety by reference to the Indenture, including the
definitions therein of certain terms, which is filedSEC as an exhibit to our registration statement. The indenture may be amended or supplemented from time to time. We will file any amendments or supplements to the Registration Statementindenture or any securities resolution which amends or supplements the indenture with the SEC. The indenture will be qualified under the Trust Indenture Act of which this Prospectus is a part.1939.
The following sets
forth certain general terms and provisionssummary of the Debt Securities. Further terms of the Offered Debt Securities will be set forthindenture is not complete and you should carefully review the indenture and any supplemental indenture or securities resolution we may file with the SEC in a Prospectus Supplement.
GENERALparticular offering.
General
We will issue debt securities in one or more series from time to time. The Indenture provides for the issuance of Debt Securities in series andindenture does not limit the principal amount of Debt Securitiesdebt securities that we may issue. The specific terms of the debt securities will be included in a supplemental indenture or securities resolution and described in a prospectus supplement. Some of the terms that may be included are:
- title and amount of securities,
- maturity date,
- redemption, which may be
issued thereunder. Reference is made tomandatory or at our option or theapplicable Prospectus Supplement for the following termsoption of theOffered Debt Securities: (1)holders, - right to defease the
designation, aggregate principal amount and denominations; (2)debt securities, - sale at a discount; debt securities sold at a discount may bear no interest or interest at a ratebelow the
pricemarket rate atwhich such Debt Securities will be issued and, if an index formula or other method is used,themethod for determining amountstime ofprincipal or interest; (3) the maturity date and other dates, if any, on which principal will be payable; (4) theissuance,
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- interest
rate orrates(whichthat may be fixed orvariable), if any; (5)variable, - procedures for the
dateauction ordates fromremarketing of securities, - currency in which
interest will accrue and on which interestsecurities will bepayable, and the record dates for the payment of interest; (6) the manner of paying principal or interest; (7) the places where principal and interest will be 35 payable; (8) the terms of any mandatory or optional redemption by the Company; (9) the terms of any redemption at the option of Holders; (10) whether and upon what terms any Debt Securities may be exchanged; (11) whether such Debt Securities are to be represented in whole or in part by a Debt Security in global form and, if so, the identityissued, - listing of the
depositary ("Depositary") fordebt securities on a national securities exchange, and - any
global Debt Security; (12) any tax indemnity provisions; (13) the amountchanges to orportion of principal payable upon acceleration of a discounted Debt Security; (14) whether and upon what terms Debt Securities may be defeased; (15) anyadditional events of default orrestrictive covenants in addition to or in lieu of those set forthcovenants.
Unless otherwise specified in the Indenture; (16) provisions for electronic issuanceprospectus supplement, we will issue the debt securities only as fully registered global debt securities.
Status of Debt Securities or for Debt Securities in uncertificated form; and (17) any
additional provisions or other special terms not inconsistent with the
provisions of the Indenture, including any terms that may be required or
advisable under United States or other applicable laws or regulations, or
advisable in connection with the marketing of the Debt Securities.
One or more series of the Debt Securities may be issued as discounted Debt
Securities (bearing no interest or bearing interest at a rate which at the time
of issuance is below market rates) to be sold at a substantial discount below
their stated principal amount. Tax and other special considerations applicable
to any such discounted Debt Securities will be described in the Prospectus
Supplement relating thereto.
STATUS OF DEBT SECURITIES
The Debt Securities
Our debt securities will be unsecured and unsubordinated obligations of the
Company and will rank on a parity with all of our other unsecured and unsubordinated indebtednessindebtedness.
Payment and Transfer
We will pay amounts due on the debt securities at the place or places designated by us for such purposes. We may, at our option, pay by check mailed to the person in whose name your debt securities are registered at the close of business on the day or days specified by us.
If debt securities are registered in your name, you may transfer debt securities at the office of the Company. At the date of this Prospectus, the Company had no
outstanding indebtedness for money borrowed securedtrustee or at any other office or agency maintained by a mortgage or pledge of
or lien on assets.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in global
form. A Debt Security in global form will be deposited with, or on behalf of, a
Depositary, which will be identified in an applicable Prospectus Supplement. A
global Debt Security may be issued in either registered or bearer form and in
either temporary or permanent form. Unless and until it is exchanged in whole or
in part for Debt Securities in definitive form, a Debt Security in global form
may not be transferred except as a whole by the Depositaryus for such Debt
Security to a nomineepurposes, without the payment of such Depositaryany service charge, except for any tax or by a nomineegovernmental charge.
Absence of such Depositary to
such Depositary or another nominee of such Depositary or by such Depositary or
any such nominee to a successor of such Depositary or a nominee of such
successor. If any Debt Securities of a series are issuableRestrictive Covenants
Unless otherwise indicated in global form, the applicable Prospectus Supplement will describe the circumstances, if any, under
which beneficial owners of interests in any such global Debt Security may
exchange such interests for definitive Debt Securities of such series and of
like tenor and principal amount in any authorized form and denomination, the
manner of payment of principal of, premium and interest, if any, on any such
global Debt Security and the material terms of the depositary arrangement with
respect to any such global Debt Security.
ABSENCE OF RESTRICTIVE COVENANTS
The Company is not prospectus supplement, we are not:
- restricted by the
Indentureindenture from paying dividends or from incurring, assuming or becoming liable for any type of debt or other obligations, including obligations secured by our property,of the Company. The Indenture does not require the maintenance of - required to maintain any financial ratios or specified levels of net worth or
liquidity. The Indenture does not contain a covenant or other provision that specifically is intended to afford the holders of the Debt Securitiesliquidity, and - providing you any special protection in the event of a highly leveraged transaction.
SUCCESSOR CORPORATION
Successor Corporation
The Indenture provides that the Company mayindenture allows us:
- to consolidate
with, or transfer all or substantially all of its assets to,or merge with or into any othercorporation, provided, thatperson, or - any other person to merge into us, or
- our company to transfer all or substantially all of our assets to another person,
if, in any such case: (i) each case, the following conditions are satisfied:
- the surviving
Companycompany - is a
corporationperson organized and existing under the laws of the United States oranya state,thereof and, if not the Company,or - assumes, by supplemental indenture, all of
theour obligationsof the Companyunder theDebt Securitiesdebt securities and theIndentureindenture, and(ii) - immediately after
suchthe merger,orconsolidation orsuchtransfer,46there is no defaultexists inunder theperformance of any such obligation.indenture.
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We will be relieved from our obligations on the debt securities and under the indenture if these conditions are satisfied.
Subject to certain limitations in the Indenture,indenture, the Trusteetrustee may receive from the Companyrely on an officer'sofficer’s certificate and an opinion of counsel from us as conclusive evidence that any such consolidation, merger or transfer, and any suchrelated assumption of our obligations, complies with the provisionindenture.
Events of Default
Unless otherwise indicated in the applicable prospectus supplement, the term “event of default”, when used in the indenture, means any of the Indenture.
EVENTS OF DEFAULT
An "Event of Default" with respectfollowing:
- if we fail to
a series of Debt Securities will occur if: (1) the Company defaults inpay anypaymentinstallment of intereston any Debt Securities of the serieswhenthe same becomesdueand payable and the Defaultif our failure continues for a period of 60days; (2) the Company defaults in the payment of thedays, - if we fail to pay principal
of any Debt Securities of the serieswhenthe same becomesdueand payable at maturity or upon redemption, acceleration or otherwise and the Defaultif our failure continues fora period ofthree businessdays; (3) the Company defaults in the payment or satisfaction ofdays, - if we fail to deposit any sinking fund
obligation with respect to any Debt Securities of a series as required by the Securities Resolution or supplemental indenture establishing such series and the Defaultpayment when due if our failure continues fora period ofthree businessdays; (4) the Company defaults in the performance ofdays, - if we fail to perform for 90 days after notice any of
itsour other agreements applicable to theseries and the Default continues for 90 days after the notice specified below; (5) the Company pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointmentdebt securities of aCustodian for itseries, - if certain events in bankruptcy, insolvency or
for allreorganization occur, orsubstantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company in an involuntary case, (B) appoints a Custodian for the Company or for all or substantially all of its property, or (C) orders the liquidation of the Company; and the order or decree remains unstayed and in effect for 60 days; or (7) - if any other event of default provided
forin the terms of the debt securities of the series occurs."Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or State law for
Unless otherwise provided in the relief of debtors.
"Custodian" means any receiver, trustee, assignee, liquidator or a similar
official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default. A Default described in clause (4) above is not an
Event of Default untilapplicable prospectus supplement, the Trustee or the Holders of at least 33 1/3% in
principal amount of the series notify the Company of the Default and the Company
does not cure the Default within the time specified after receipt of the notice.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Debt Securities of the series. Subject to certain limitations,
Holders of a majority in principal amount of the Debt Securities of the series
may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the series notice of any continuing Default (except a
Default in payment of principal or interest) if it determines that withholding
notice is in their interest. The Company is required to furnish the Trustee,
annually, a brief certificate as to the Company's compliance with all conditions
and covenants under the Indenture.
The Indentureindenture does not have a cross-default provision. Thus, a default by the Companyus on any other debt would not constitute an Eventevent of Default.default. A Defaultdefault on any series of Debt Securities shalldebt securities does not necessarily constitute a Defaultdefault on any other series unless so provided in such other series. AMENDMENTS AND WAIVERS
Unless the Securities Resolution establishing the termsThe trustee may withhold notice to you of a default for such series otherwise provides,(except for payment defaults) if the Indenturetrustee considers the withholding of notice in your best interests.
If an event of default for any series of debt securities has occurred and is continuing, the Debt Securitiestrustee or the holders of anot less than one-third in aggregate principal amount of the debt securities of such series may be
amended, and any defaultsend a notice declaring the entire principal amount (or in the case of discounted debt securities, such portion as may be described in the applicable prospectus supplement) of all the debt securities of such series to be due and payable immediately. The trustee is required to notify you of any such event that would become a default if the trustee has actual knowledge of the event. Subject to certain conditions, the holders of not less than a majority in aggregate principal amount of the debt securities of such series may annul any declaration and rescind its consequences, except for failure to pay interest or principal, to make any deposit in a sinking fund or any other event of default which may not be waived as follows. The Debt Securities andwithout the Indenture may be amendedconsent of all security holders affected by the default.
We must file a certificate annually with the consenttrustee regarding our compliance with the indenture.
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The trustee may require a reasonable indemnity from you before it enforces the indenture or the debt securities of any series. Subject to these provisions for indemnification, the holders of a majority in principal amount of the Debt Securitiesdebt securities of all series affected voting as one
class. Unless the Securities Resolution establishing the terms of the series
otherwise provides, a default on aany series may be waived withdirect the consenttime, method and place of conducting any proceeding or any remedy available to the trustee, or of exercising any trust or power conferred upon the trustee, for the debt securities of such series.
Modification of Indenture
Unless otherwise indicated in the applicable prospectus supplement, the holders of not less than a majority in aggregate principal amount of all outstanding debt securities, voting together as a single class, may, with certain exceptions described below, modify the Debt Securities of the series.
However, without the consent of each Holder affected, no amendment or waiverindenture. We may (1) reducenot, however, modify any terms relating to the amount or timing of Debt Securities whose holders must consent to an
amendment or waiver, (2) reduce the interest on or change the time for payment
of interest on any Debt Security, (3) change the dates on which principal and
interest on any Debt
5
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Security are payable, (4) change the times at which principal or sinking fund
payments are payable pursuant to, or the amounts of principal or sinking fund
payments subject to, provisions, if any, relating to mandatory redemption,
redemption at the option of the Holder or sinking fund payments, (5) reduce the
principal of any non-discounted Debt Security or reduce the amountpercentage of principalholders required to approve modifications to the indenture without your consent.
We may modify the indenture without your consent to:
- create a new series of
any discounted Security that would be due on acceleration thereof,debt securities and establish its terms, - cure ambiguities or
(6) waive any default in payment of interest on or principal of a Debt Security. Withoutfix omissions, - comply with the
consent of any Holder, the Indenture, the Debt Securities or any coupons may be amended to cure any ambiguity, omission, defect or inconsistency; to provide for assumption of Company obligations to Holders in the event of a merger or consolidation requiring such assumption; to provide that specificprovisions of theIndenture not apply to a series of Securities not previously issued; to create a series and establish its terms; to provide for a separate Trustee for oneindenture regarding successor corporations, ormore series; or to - make any change that does not materially adversely affect your rights as a holder of debt securities.
Unless otherwise provided in the applicable prospectus supplement or prohibited by the indenture, we may also amend the indenture with the written consent of a majority in principal amount of the debt securities of all series affected by the amendment voting together as a single class.
We are prohibited from amending the indenture without the consent of all holders of debt securities to:
- reduce the amount of debt securities whose holders must consent to an amendment,
- reduce the amount of interest or change the time for payment of interest,
- change the amount or times for sinking fund or principal payments, or
- make any change in the rights of
any Securityholder. DEFEASANCE Debt Securitiessecurity holders with respect to waiver ofa seriesdefaults or making amendments or modifications to the indenture,
Defeasance
Unless otherwise provided in the applicable prospectus supplement, we may be defeased in accordance with their terms
and, unless the Securities Resolution establishing the terms of the series
otherwise provides, as set forth below. The Company at any time may either:
- terminate as to a series all of
itsour obligations (except for our obligation to pay all amounts due on the debt securities in accordance with their terms and certain other obligations with respect tothe defeasance trust and obligations to registersuch matters as the transferor exchangeof aDebt Security, to replacedebt security and the replacement of destroyed, lost or stolenDebt Securities and to maintain agencies in respect of the Debt Securities) with respect to the Debt Securities of the series and the Indenture ("legal defeasance"). The Company at any time maydebt securities), or - terminate as to a series
itsour obligations, if any, with respect to theDebt Securitiesdebt securities ofthesuch series under the covenants, if any, applicable to such series as described in theProspectus Supplement ("covenant defeasance"). The Companyprospectus supplement.
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We may exercise its legaleither defeasance option notwithstanding itsour prior exercise of its covenantthe other defeasance option. If the Company exercises its
legal defeasance option,we terminate all of our obligations, a series may not be accelerated because of an Eventevent of Default.default. If the Company exercises its covenant defeasance option,we terminate our covenants, a series may not be accelerated by reference to the covenants described in the Prospectus
Supplement.applicable prospectus supplement.
To exercise either defeasance option as to a series the Companyof debt securities, we must deposit in trust (the "defeasance trust") with the Trusteetrustee money or U.S. Government Obligations for the payment of principal, premium, if any, and
interestgovernment obligations sufficient to make all payments on the Debt Securitiesdebt securities of the series being defeased to redemption or maturity andmaturity. We must also comply with certain other conditions. In particular, the Companywe must obtain an opinion of tax counsel that the defeasance will not result in recognition of any gain or loss to Holdersyou for Federal income tax purposes. "U.S. Government
Obligations" are direct obligations
Regarding the Trustee
Unless otherwise indicated in the applicable prospectus supplement, The Bank of the United StatesNew York Mellon Trust Company, N.A. (formerly known as The Bank of America which have
the full faith and credit of the United States of America pledged for payment
and which are not callable at the issuer's option, or certificates representing
an ownership interest in such obligations.
REGARDING THE TRUSTEENew York Trust Company, N.A.), as successor to JPMorgan Chase Bank, National Association (formerly Chemical Trust Company of California, then Chase Manhattan Bank and Trust Company, National Association, and then J.P. Morgan Trust Company, National Association) will act as Trusteetrustee, registrar, transfer and Registrarpaying agent for Debt Securities issued under the Indenture and, unless otherwise indicated in a
Prospectus Supplement, the Trustee will also act as Transfer Agent and Paying
Agent with respect to the Debt Securities. The Companydebt securities. We may remove the Trusteetrustee with or without cause if we notify the Company so notifies the Trustee one monthtrustee 30 days in advance and if no Defaultdefault occurs or is continuing during the one-month30-day period. GOVERNING LAWIn addition, the holders of a majority of the principal amount of the outstanding debt securities may remove the trustee by notifying the trustee and appointing a successor trustee with our consent.
In certain circumstances, the trustee may not enforce its rights as one of our creditors. The Indenturetrustee may, however, engage in certain other transactions. If it acquires any conflicting interest as a result of any of these transactions and there is a default under the debt securities, the trustee must eliminate the conflict of interest or resign.
The trustee also acts as trustee under an indenture between American States Water Company or AWR and the Debt Securitiestrustee, dated December 1, 1998, under which certain debt securities of AWR may be issued and outstanding at the same time that debt securities may be issued and outstanding under the indenture. Under the indenture, the trustee is authorized to continue acting as trustee under the AWR indenture with respect to such AWR debt securities while also acting as trustee with respect to the debt securities. So long as a successor trustee has been appointed, the indenture further authorizes the trustee to resign from either or both of its appointments as trustee hereunder and as trustee under AWR’s indenture in the event that the trustee determines in good faith that its performance hereunder or under AWR’s indenture subjects the trustee to a conflict of interest.
Governing Law
The indenture and the debt securities will be governed by and construed in accordance with the laws of the State of California.
DESCRIPTION OF CAPITAL SHARES
GLOBAL SECURITIES
We will issue the debt securities initially in book-entry form and they will be represented by one or more global notes or global securities, or collectively, the global securities. We will deposit the global securities with, or on behalf of, The Depository Trust Company or DTC, New York, New York, as depositary. The global securities will be issued as fully-registered securities registered in the name of Cede & Co., DTC’s partnership nominee, or such other name as may be requested by an authorized capital stockrepresentative of DTC. One fully-registered global security certificate will be issued for each issue of the Company consistsdebt securities, each in the aggregate principal amount of 10,000,000 Common
Shares, par value $2.50 per share,such issue, and two classes of Preferred Shares,
consisting of 150,000 $100 Preferred Shares, par value $100 per share (the "$100
Preferred Shares"),will be deposited with DTC.
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Unless and 88,000 Preferred Shares, par value $25 per share (the
"$25 Pre-
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8
ferred Shares"). As of July 31, 1995, there were outstanding 7,845,092 Common
Shares, 88,000 $25 Preferred Shares (of which 24,000 are subjectuntil it is exchanged for individual certificates evidencing the debt securities under the limited circumstances described below, a global security may not be transferred except as a whole by the depositary to mandatory
redemption) and no $100 Preferred Shares.
The following statements are brief summaries of certain information
relatingits nominee or by the nominee to the Company's Common Sharesdepositary, or by the depositary or its nominee to a successor depositary or to a nominee of the successor depositary.
DTC has advised us that it is:
- the world’s largest securities depository;
- a limited-purpose trust company organized under the New York Banking Law;
- a “banking organization" within the meaning of the New York Banking Law;
- a member of the Federal Reserve System;
- a “clearing corporation" within the meaning of the New York Uniform Commercial Code; and
their rights and limitations, including those resulting from - a “clearing agency" registered pursuant to the provisions of Section 17A of the
Company'sSecurities Exchange Act of 1934.
DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt instruments.
Forissues, and money market instruments from over 100 countries that DTC’s participants, or direct participants, deposit with DTC. DTC also facilitates the post-trade settlement among direct participants of sales and other securities transactions in deposited securities through electronic computerized book-entry transfers and pledges between direct participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a more complete statement, referencewholly-owned subsidiary of The Depository Trust & Clearing Corporation, or DTCC. DTCC is madethe holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the Company's Restated
Articles of Incorporation, whichDTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly, or indirect participants. The DTC Rules applicable to its participants are filed as an exhibit toon file with the Registration
Statement of which this Prospectus is a part.
DIVIDEND RIGHTS
Subject to the preferential dividend rights of holdersSEC.
Purchases of the Company's $25
Preferred Shares and $100 Preferred Shares, if any, dividendsdebt securities under the DTC system must be made by or through direct participants, which will receive a credit for such interests on DTC’s records. The ownership interest of each actual purchaser of interest in the debt securities, or beneficial owner, is in turn to be recorded on the Common
Sharesdirect and indirect participants’ records. Beneficial owners will not receive written confirmation from DTC of their purchase. Beneficial owners are, payable when and as declared by the Board of Directors out of funds
not restricted ashowever, expected to the payment of dividends.
The Company's Restated Articles of Incorporation provide that except under
certain specified circumstances no dividend, other than dividends payable in
sharesreceive written confirmations providing details of the Company,transaction, as well as periodic statements of their holdings, from the direct or indirect participant through which the beneficial owner entered into the transaction. Transfers of ownership interests in the debt securities are to be accomplished by entries made on the books of direct and indirect participants acting on behalf of beneficial owners. Beneficial owners will not receive certificates representing their ownership interests in the debt securities, except in the event that use of the book-entry system for the debt securities is discontinued.
To facilitate subsequent transfers, all debt securities deposited by direct participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co. or such other name as may be declaredrequested by an authorized representative of DTC. The deposit of debt securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual beneficial owners of the debt securities; DTC’s records reflect only the identity of the direct participants to whose accounts such debt securities are credited, which may or may not be the beneficial owners. The direct and indirect participants will remain responsible for keeping account of their holdings on behalf of their customers.
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Conveyance of notices and other communications by DTC to direct participants, by direct participants to indirect participants, and by direct participants and indirect participants to beneficial owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.
Redemption notices shall be sent to DTC. If less than all of the Common Shares which, after giving
effectdebt securities within an issue are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each direct participant in such declaration, would cause the Company's Common Stock Equityissue to be less than 25% of the Total Capitalization, asredeemed.
Neither DTC nor Cede & Co., nor such terms are defined therein.
Common Stock Equity under this formula was approximately 55% of Total
Capitalization as of June 30, 1995. The payment of dividends on the Common
Shares is also restricted under various debt instruments which have been issued.
Under the most restrictive provision (which is contained in the Reimbursement
Agreement by and between the Company and Barclays Bank International Limited
dated as of November, 1984), as of June 30, 1995, earned surplus of $16,190,000
was available, subject to applicable law, for the payment of cash dividends on
the Common Shares.
Preferred dividends are cumulative, so that if full dividends, in respect
of any previous quarter, have not been paid,other DTC nominee, will consent or declared and set apart for
payment, on all $25 Preferred Shares and $100 Preferred Shares at the time
outstanding, or if the Company is in default with respect to any preferred
sinking fund requirement, the deficiency must be fully paid before any dividend
can be paid on the Common Shares.
VOTING RIGHTS
Holders of Common Shares and $25 Preferred Shares are entitled to vote
together on all matters. Each holder of Common Shares is entitled to one-tenth
of one vote for each share held and each holder of $25 Preferred Shares is
entitled to one vote for each share held as of the applicable record date. If at
any time four quarterly dividends (whether or not consecutive) have accrued on
shares of any series of $25 Preferred Shares and are in arrears, then at the
annual meeting of shareholders next following such dividend default, or under
certain circumstances, at a special meeting called on the written request of the
holders of not less than 10% of the then-outstanding $25 Preferred Shares, the
holders of the outstanding $25 Preferred Shares are entitled, voting separately
as a class, to elect the smallest number of directors of the Company which
constitutes a majority of the authorized number of such directors.
In addition, it is provided in the Restated Articles of Incorporation with respect to the $25 Preferred Sharesdebt securities unless authorized by a direct participant in accordance with DTC’s procedures. Under its usual procedures, DTC will mail an omnibus proxy to us as soon as possible after the record date. The omnibus proxy assigns Cede & Co.’s consenting or voting rights to those direct participants to whose accounts the interests in the debt securities are credited on the record date (identified in a classlisting attached to the omnibus proxy).
So long as the debt securities are in book-entry form, redemption proceeds and each series of $100 Preferred
Shares thatdistributions on the Company may not take certain actions which may adversely affect
their interest without the approval of two-thirds ( 2/3)debt securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon DTC’s receipt of funds and corresponding detail information from us or the applicable agent on payable date in certain
instances a majority,accordance with their respective holdings shown on DTC’s records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is the case with debt securities held for the accounts of customers in bearer form or registered in “street name," and will be the responsibility of such participant and not of DTC, the agent, or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds and distributions to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is our responsibility or the applicable agent’s, disbursement of such payments to direct participants will be the responsibility of DTC, and disbursement of such payments to the beneficial owners will be the responsibility of direct and indirect participants.
We will maintain an office or agency in the Borough of Manhattan, the City of New York, New York, where notices and demands in respect of the outstanding sharesdebt securities and the indenture may be delivered to us and where certificated debt securities may be surrendered for payment, registration of transfer or exchange. That office or agency will initially be the office of an affiliate of the trustee, which is currently located at The Bank of New York Mellon, 101 Barclay Street, New York, New York 10286, Attention: Corporate Trust Administration.
If the debt securities provide for optional or mandatory purchase, a beneficial owner shall give notice to elect to have its debt securities purchased or tendered, through its participant, to the tender/remarketing agent specified in the applicable prospectus supplement and shall effect delivery of such classdebt securities by causing the direct participant to transfer the participant’s interest in the debt securities, on DTC’s records, to the tender/remarketing agent. The requirement for physical delivery of debt securities in connection with an optional tender or series,a mandatory purchase will be deemed satisfied when the ownership rights in the debt securities are transferred by direct participants on DTC’s records and followed by a book-entry credit of tendered securities to the tender/remarketing agent’s DTC account.
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Except under the limited circumstances described below, purchasers of debt securities will not be entitled to have debt securities registered in their names and will not receive physical delivery of debt securities. Accordingly, each beneficial owner must rely on the procedures of DTC and its participants to exercise any rights under the debt securities, the indenture or the certificate of determination, as applicable.
The laws of certain jurisdictions may require that some purchasers of the casedebt securities take physical delivery of the debt securities in definitive form. Those laws may be. Actionsimpair the ability to transfer or pledge beneficial interests in the debt securities.
DTC may discontinue providing its services as depository with respect to whichthe debt securities at any time by giving reasonable notice to us or the applicable agent. Under such approval is required (in some
instances only if the proposed action does not satisfy certain tests) include
(i) alterations in the preferences, voting powers and other rights of such class
or series, (ii) authorization or issuance of any shares of any class ranking
prior to such class or series, (iii) reclassification of shares of any class
ranking junior to or on a parity with such class or series into shares of any
other class ranking prior to such class or series, (iv) the sale, conveyance,
leasing or other disposition of all or substantially all of the Company's
assets, properties or business and (v) consolidation or merger with or into any
other corporation.
LIQUIDATION RIGHTS
After there shall have been paid in cash the full amounts to which the $25
Preferred Shares and the $100 Preferred Shares are entitled upon liquidation,
whether voluntary or involuntary ($25 per share and $100 per share,
respectively, except that the holders of two series of $25 Preferred Shares are
entitled to
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receive the then-applicable optional redemption price per sharecircumstances, in the event ofthat a voluntary liquidation plus, in each case, accruedsuccessor securities depository is not obtained, securities certificates are required to be printed and unpaid dividends), the
holdersdelivered. We may also decide to discontinue use of the Company's Common Shares are entitled to receive pro rata all
remaining assetssystem of the Company available for distribution to its shareholders.
GENERAL
No holder of any of the Company's capital shares is entitled, as of right,
to subscribe for or to purchase any additional capital shares of the Company.
The Common Shares of the Company offered herebybook-entry-only transfers through DTC (or a successor securities depository). In that event, securities certificates will be fully paidprinted and nonassessable when issued.
delivered to DTC in the name or names that the depositary directs.
The Transfer Agentinformation in this section and Registrarelsewhere in this prospectus concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be reliable, but we take no responsibility for the Common Shares is First Interstate
Bankaccuracy of California.
Unless otherwise disclosed in the applicable Prospectus Supplement, the
Common Shares will be listed on the New York Stock Exchange under the symbol
"SCW".
this information.
PLAN OF DISTRIBUTION
The Company
We may sell the Securitiessecurities covered by this prospectus from time to time. Registration of the securities covered by this prospectus does not mean, however, that those securities will necessarily be offered or sold.
We may sell the debt securities:
- to or through one or more underwriters
for public offering and sale by themor dealers; - in short or long transactions;
- directly to investors; or
- through agents.
We may sell the Securitiesdebt securities from time to investors directlytime:
- in privately negotiated transactions;
- in one or
through agents. Any such underwriter or agent involved in the offer and sale of Securities will be named in the applicable Prospectus Supplement. The Company has reserved the right to sell Securities directly to investors on its own behalf in those jurisdictions where it is authorized to do so. Underwriters may offer and sell Securitiesmore transactions at a fixed price or prices, which may be changedatfrom time totime; - in "at the market
prices prevailing atofferings," within thetimemeaning ofsale,Rule 415(a)(4) of the Securities Act of1933, to or through a market maker or into an existing trading market, on an exchange orotherwise; - at prices related to such prevailing market
pricesprices; or - at negotiated prices.
The Company also may, from time
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We, and our underwriters, dealers or agents, reserve the right to time, authorize dealers, acting asaccept or reject all or part of any proposed purchase of the Company's agents,
to offer and sell Securities upon the terms and conditions as aredebt securities. We will set forth in a prospectus supplement the applicable Prospectus Supplement. In connection withterms of the saleoffering of Securities,debt securities, including:
- the names of any underwriters,
may receive compensation from the Company in the form ofdealers or agents; - any agency fees or underwriting discounts or commissions and other items constitutingagents' or underwriters' compensation;
- any discounts or concessions allowed or reallowed or paid to dealers;
- details regarding over-allotment options under which underwriters may
alsopurchaseadditional debt securities from us, if any; - the purchase price of the securities being offered and the proceeds we will receive
commissionsfromthe sale; - the public offering price; and
- the securities exchanges on which such debt securities may be listed, if any.
We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions from purchaserstime to time. If the applicable prospectus supplement indicates, in connection with those derivative transactions, such third parties (or affiliates of Securities for whom they may act as agent. Underwritersthird parties) may sell Securitiessecurities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, such third parties (or affiliates of third parties) may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of securities, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of securities. The third parties (or affiliates of such third parties) in such sale transactions will be underwriters and will be identified in an applicable prospectus supplement or a post-effective amendment.
We may loan or pledge debt securities to a financial institution or other third party that in turn may sell the debt securities using this prospectus and an applicable prospectus supplement. Such financial institution or third party may transfer its economic short position to investors in our offered securities or in connection with a simultaneous offering of other securities offered by this prospectus.
Underwriters, Agents and Dealers
If underwriters are used in the sale of our debt securities, the debt securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions described above. The debt securities may be either offered to the public either through underwriting syndicates represented by managing underwriters or directly by underwriters. Generally, the underwriters’ obligations to purchase the debt securities will be subject to conditions precedent and the underwriters will be obligated to purchase all of the debt securities if they purchase any of the debt securities. We may use underwriters with whom we have a material relationship. We will describe in the prospectus supplement, naming the underwriter, the nature of any such relationship.
We may sell the debt securities through agents from time to time. The prospectus supplement will name any agent involved in the offer or sale of the debt securities and any commissions we pay to them. Generally, any agent will be acting on a best efforts basis for the period of its appointment.
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We may authorize underwriters, dealers or agents to solicit offers by certain purchasers to purchase the debt securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. The contracts will be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth any commissions we pay for solicitation of these contracts.
Underwriters, dealers and suchagents may contract for or otherwise be entitled to indemnification by us against certain civil liabilities, including liabilities under the Securities Act of 1933 or to contribution with respect to payments made by the underwriters, dealers or agents, under agreements between us and the underwriters, dealers and agents.
We may grant underwriters who participate in the distribution of debt securities an option to purchase additional debt securities to cover over-allotments, if any, in connection with the distribution.
Underwriters, dealers or agents may receive compensation in the form of discounts, concessions or commissions from the underwriters and/us or commissions from theour purchasers, for whom they may act as agent.
Any underwriting compensation paid by the Company to underwriters ortheir agents in connection with the sale of debt securities. These underwriters, dealers or agents may be considered to be underwriters under the Securities Act of 1933. As a result, discounts, commissions or profits on resale received by the underwriters, dealers or agents may be treated as underwriting discounts and commissions. The prospectus supplement will identify any such underwriter, dealer or agent and describe any compensation received by them from us. Any public offering of Securities,price and any discounts or concessions allowed or commissions allowedreallowed or paid to dealers may be changed from time to time.
Any underwriter may engage in overallotment transactions, stabilizing transactions, short-covering transactions and penalty bids in accordance with Regulation M under the Securities Exchange Act of 1934. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of securities than they are required to participating dealers, will be set forthpurchase in the applicable Prospectus Supplement. Dealersoffering. "Covered" short sales are sales made in an amount not greater than the underwriters’ option to purchase additional securities from us in the offering, if any. If the underwriters have an over-allotment option to purchase additional securities from us, the underwriters may consider, among other things, the price of securities available for purchase in the open market as compared to the price at which they may purchase securities through the over-allotment option. "Naked" short sales are any sales in excess of such option or where the underwriters do not have an over-allotment option. The underwriters must close out any naked short position by purchasing securities in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the securities in the open market after pricing that could adversely affect investors who purchase in the offering.
Accordingly, to cover these short sales positions or to otherwise stabilize or maintain the price of the debt securities, the underwriters may bid for or purchase securities in the open market and agentsmay impose penalty bids. If penalty bids are imposed, selling concessions allowed to syndicate members or other broker-dealers participating in the distributionoffering are reclaimed if securities previously distributed in the offering are repurchased, whether in connection with stabilization transactions or otherwise. The effect of Securitiesthese transactions may be to stabilize or maintain the market price of the debt securities at a level above that which might otherwise prevail in the open market. The imposition of a penalty bid may also affect the price of the debt securities to the extent that it discourages resale of the debt securities. The magnitude or effect of any stabilization or other transactions is uncertain.
Underwriters, broker-dealers or agents who may become involved in the sale of our debt securities may engage in transactions with and perform other services for us for which they receive compensation.
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Direct Sales
We may also sell debt securities directly to one or more purchasers without using underwriters or agents. In this case, no agents, underwriters or dealers would be involved. We may sell debt securities upon the exercise of rights that we may issue to our security holders. We may also sell the debt securities directly to institutional investors or others who may be deemed to be underwriters and any discounts
and commissions received by them and any profit realized by them on resalewithin the meaning of
the Securities may be deemed to be underwriting discounts and commissions.
Underwriters, dealers and agents may be entitled, under agreements entered into
with the Company, to indemnification against and contribution toward certain
civil liabilities, including liabilities under the Securities Act of 1933 as
amended. Underwriters, dealerswith respect to any sale of those debt securities.
Trading Market and agentsListing of Securities
The securities offered by us may be customers of, engage in
transactions with, or perform services for the Company in the ordinary course of
business.
It hasmay not been determined whether any of the Debt Securities will be listed on a national securities exchange. UnderwritersIt is possible that one or more underwriters may make a market in a class or series of debt securities, but the underwriters will not be obligated to make ado so and may discontinue any market inmaking at any time without notice. We cannot give any assurance as to the liquidity of the trading market for any of the Securities.
our securities offered.
LEGAL MATTERS
Matters relating to
O’Melveny & Myers LLP will pass on the legalityvalidity of the Debt Securities and Common Sharessecurities offered by this Prospectusprospectus for us. If counsel for any underwriters passes on legal matters in connection with an offering of our securities described in this prospectus, we will be passed upon for the Company by O'Melveny &
Myers. R. Bradbury Clark, a director of the Company, is ofname that counsel to and a
retired partner in the firm of O'Melveny & Myers. Certain legal mattersprospectus supplement relating to the Debt Securities and Common Shares offered hereby will be passed upon for
the Underwriters by Cahill Gordon & Reindel, a partnership including a
professional corporation, New York, New York, which firm will rely upon the
opinion of O'Melveny & Myers as to matters of California law.
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that offering.
EXPERTS
The consolidated financial statements and schedules of the Company incorporated in this Prospectus by reference to its Annual Reportthe annual report on Form 10-K for the year ended December 31, 19942007 have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their reports with respect thereto, and areso incorporated herein in reliance uponon the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in accountingauditing and auditingaccounting.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 under the Securities Act of 1933 with respect to the securities offered by this prospectus. This prospectus does not contain all the information set forth in giving said reports.
9
the registration statement and the exhibits and schedules thereto. For further information about us and the securities, we refer you to the registration statement and to the exhibits and schedules filed with it. Statements contained in this prospectus as to the contents of any contract or other documents referred to are not necessarily complete. We refer you to those copies of contracts or other documents that have been filed as exhibits to the registration statement, and statements relating to such documents are qualified in all aspects by such reference.
We file annual, quarterly and special reports and other information with the SEC. You may read and copy any document we file at the SEC’s Public Reference Rooms at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC filings are also available to the public at the SEC’s web site athttp://www.sec.gov. You may also obtain information about us at our web-site athttp://www.gswater.com. The information on our web-site does not constitute a part of this prospectus.
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INCORPORATION OF DOCUMENTS BY REFERENCE
To avoid repeating information in this prospectus that we have already filed with the SEC, we have incorporated by reference the filings (File No. 001-12008) listed below with respect to the information regarding Golden State Water Company. This information is considered a part of this prospectus. These documents are as follows:
- our annual report on Form 10-K for the year ended December 31, 2007;
- our quarterly reports on Form 10-Q for the quarters ended March 31, 2008, June 30, 2008 and September 30, 2008; and
- our current reports on Form 8-K filed with the SEC on January 31, 2008, March 31, 2008, May 23, 2008, August 4, 2008, August 26, 2008, September 22, 2008, November 4, 2008 and November 5, 2008.
In addition, all documents that we file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of the initial registration statement of which this prospectus is a part and prior to the effectiveness of the registration statement as well as the date of this prospectus and before the termination of the offering of our securities shall be deemed incorporated by reference into this prospectus and to be a part of this prospectus from the respective dates of filing such documents with respect to the information regarding Golden State Water Company. Unless specifically stated to the contrary, none of the information that we disclose under Items 2.02 or 7.01 of any Current Report on Form 8-K that we may from time to time furnish to the SEC will be incorporated by reference into, or otherwise included in, this prospectus.
You may request a copy of these filings with the SEC, at no cost, by writing or telephoning us at the following address:
| Corporate Secretary | |
| Golden State Water Company | |
| 630 East Foothill Boulevard | |
| San Dimas, California 91773 | |
| (909) 394-3600 |
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed modified, superseded or replaced for purposes of this prospectus to the extent that a statement contained in this prospectus or in any subsequently filed document that also is or is deemed to be incorporated by reference in this prospectus modifies, supersedes or replaces such statement. Any statement so modified, superseded or replaced shall not be deemed, except as so modified, superseded or replaced, to constitute a part of this prospectus.
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Debt Securities
GoldenState
WATER COMPANY
_______________________
PROSPECTUS
_______________________
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The other expensesOther Expenses of these offerings are as follows:
Issuance and Distribution.*
| Registration | $ | ||
| Rating agency fees | 135,000 | * | |
| Printing and engraving | 5,000 | * | |
| Accounting fees and expenses | 34,000 | * | |
| Legal fees and | 160,000 | * | |
| Blue | 5,000 | * | |
| Fees and expenses of Transfer Agent and Trustee | 50,000 | * | |
| Miscellaneous | 8,000 | * | |
| Total | $ | 400,930 | * |
* Estimated
ITEMExpenses are estimated except for the registration fee.
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.Indemnification of Directors and Officers.
Section 317 of the General Corporation Law of California Corporations Code provides that a corporation has the power and in some cases is required, to indemnify an agent,
including a director or officer,any person who was or is a party or is threatened to be made a party to any proceeding againstor action by reason of the fact that he or she is or was a director, officer, employee or other agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise. Section 317 also grants authority to a corporation to include in its articles of incorporation indemnification provisions in excess of that permitted in Section 317, subject to certain expenses, judgments, fines,
settlementslimitations.
Article Five of the Company’s Restated Articles of Incorporation authorizes the Company to provide indemnification of directors, officers, employees and other amounts under certain circumstances. Article VIagents through bylaw provisions, agreements with agents, votes of shareholders or disinterested directors, or otherwise, in excess of the Registrant'sindemnification otherwise permitted by Section 317, subject only to the limitations set forth in Section 204 of the California Corporations Code.
Article VII of the Company’s Bylaws providescontains provisions implementing the authority granted in Article Five of the Company’s Restated Articles of Incorporation. The Bylaws provide for the indemnification of directors, officersany director or officer of the Company, or any person acting at the request of the Company as a director, officer, employee or agent of another corporation or other enterprise, including a Company-sponsored employee benefit plan, for any threatened, pending or completed action or proceeding to the fullest extent permitted by California law and agentsthe Company’s Restated Articles of Incorporation, provided that the Company is not liable to indemnify any director or officer or to make any advances to the director or officer (i) as allowedto which the Company is prohibited by statute. In addition,applicable law from paying as an indemnity; (ii) with respect to expenses of defense or investigation, if such expenses were or are incurred without the RegistrantCompany’s consent (which consent may not be unreasonably withheld); (iii) for which payment is actually made to the director or officer under a valid and collectible insurance policy maintained by the Company, except in respect of any excess beyond the amount of payment under such insurance; (iv) for which payment is actually made to the director or officer under an indemnity by the Company otherwise than pursuant to the Company’s Bylaws, except in respect of any excess beyond the amount of payment under such indemnity; (v) based upon or attributable to the director or officer gaining in fact any personal profit or advantage to which he or she was not legally entitled; (vi) for an accounting of profits made from the purchase or sale by the director or officer of securities of the Company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law; or (vii) based upon acts or omissions involving intentional misconduct or a knowing and culpable violation of law. Indemnification covers all expenses, liabilities and losses including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement.
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The Company has purchased directors and officers insurance policies whichto provide insuranceprotection against certain liabilities forof the directors and officers. ITEMThe Company has also entered into written agreements with each of its directors and officers incorporating the indemnification provisions of its Bylaws.
Item 16. EXHIBITS.
Exhibits.
| Exhibit | |||
| Number | Description of Exhibit | ||
| 1.01 | * | Form of | |
| 3.01 | Restated Articles of Incorporation, as amended (incorporated by reference to | ||
| 3.02 | Bylaws, as amended (incorporated by reference to Form 8-K filed on January 26, 2007) | ||
| 4.01 | Indenture with respect to Debt Securities, as supplemented | ||
| 4.02 | * | Form of | |
| 5.01 | Opinion of | ||
| 12.01 | Computation of | ||
| 23.01 | Consent of | ||
| 23.02 | Consent of | ||
| 24.01 | Power of | ||
| 25.01 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of the Trustee | ||
* Previously filed.
(1) Incorporated hereinTo be filed by amendment or pursuant to a report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and incorporated by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1990, in which
the incorporated document bore the same exhibit number.
(2) Incorporated herein by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1992, in which
the incorporated document bore the same exhibit number.
(3) Incorporated herein by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1993, in which
the incorporated document bore the same exhibit number.
(4) Incorporated herein by reference to the Registrant's Form 8-K (Commission
File No. 33-62832) filed on September 1, 1993 in which the incorporated
document bore the same exhibit number.
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ITEMherein.
Item 17. UNDERTAKINGS.Undertakings.
(a) The Registrantundersigned 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;
(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 Securities and Exchange 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; and
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(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), (a)(1)(ii) and (a)(1)(iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2)That, for the purpose of determining any liability under the Securities Act of 1933, as amended ("1933 Act"), 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 that time shall be deemed to be the initial bona fide offering thereof.
thereof;
(3) ForTo 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;
(4)That, for purposes of determining any liability under the Securities Act of 1933 to any purchaser:
(i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of this registration statement as of the date the filed prospectus was deemed part of and included in this registration statement; and
(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in this registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of this registration statement relating to the securities in this registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to the initialbona fide offering thereof. Provided, however, that no statement made in a registration statement or made in a document incorporated or deemed incorporated by reference into this registration statement or a prospectus that is part of this registration statement or prospectus that is part of this registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in this registration statement or prospectus that was part of this registration statement or made in any such document immediately prior to such effective date;
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(5)That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(b) The undersigned registrant hereby further undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant'sregistrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 as amended,(and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in thethis 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 initialbona fide offering thereof.
(4) To remove from registration
(c) Insofar as indemnification 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 described in Item 15 above, 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 Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by meansthe registrant of expenses incurred or paid by a post-effective amendmentdirector, officer or controlling person of the registrant in the successful defense of any ofaction, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, which remain unsold at the terminationregistrant will, unless in the opinion of its counsel the offering.
(5) Formatter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the purposequestion of determining any liability underwhether such indemnification by it is against public policy as expressed in the Securities Act of 1933 Act,
each post-effective amendment that contains a form of prospectus shalland will be deemed to be a new registration statement relating togoverned by the securities
offered therein, and the offeringfinal adjudication of such securities at that time shall be
deemedissue.
(d) The undersigned registrant hereby undertakes to be the initial bona fide offering thereof.
(6) That, for purposes of determining any liability under the 1933
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the 1933 Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(7) To file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the CommissionSEC under Section 305(b)(2) of thesuch Act.
Insofar as indemnification for liabilities arising under the 1933 Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described in Item 15 above, 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
1933 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 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 1933 Act and
will be governed by the final adjudication of such issue.
II-3
II-4
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
statementRegistration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Dimas, State of California, on August 7, 1995.
SOUTHERN CALIFORNIA WATER COMPANY
By /s/ JAMES B. GALLAGHER
-----------------------------------
James B. Gallagher
Vice President-Finance,
Chief Financial Officer and
SecretaryDecember 12, 2008.
| GOLDEN STATE WATER COMPANY | ||||
| By: | /s/ Floyd E. Wicks | |||
| Name: | Floyd E. Wicks | |||
| Title: | President and Chief Executive Officer | |||
Pursuant to the requirements of the Securities Act of 1933, this registration statementRegistration Statement has been signed below by the following persons in the capacities and on the dates indicated.
Each person whose signature appears below constitutes and appoints Robert J. Sprowls and Eva G. Tang, or each of them individually, his or her true and lawful attorney-in-fact and agent, with full powers of substitution and resubstitution, for and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement and any subsequent registration statement we may hereafter file with the Securities and Exchange Commission pursuant to Rule 462(b) under the Securities Act to register additional securities in connection with this registration statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or either of them individually, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
| Signature | Title | Date | ||
| /s/ Floyd E. Wicks | Principal Executive Officer, | |||
| Floyd E. Wicks | President, Chief Executive Officer | December 12, 2008 | ||
| and Director | ||||
| Principal Financial Officer and | ||||
| /s/ Eva G. Tang | Principal Accounting Officer, Senior | |||
| Eva G. Tang | Vice President-Finance, Chief | December 12, 2008 | ||
| Financial Officer and Secretary | ||||
| /s/ Lloyd E. Ross | Chairman of the Board | December 12, 2008 | ||
| Lloyd E. | ||||
| /s/ James L. Anderson | Director | December 12, 2008 | ||
| James | ||||
II-5
| Signature | Title | Date | ||
| /s/ Anne M. Holloway | Director | December 12, 2008 | ||
| Anne M. Holloway | ||||
| /s/ N.P. Dodge, Jr. | Director | December 12, 2008 | ||
| N.P. Dodge, Jr. | ||||
| /s/ Robert F. Kathol | Director | December 12, 2008 | ||
| Robert F. Kathol | ||||
| /s/ Gary F. King | Director | December 12, 2008 | ||
| Gary F. King | ||||
| _____________ | ||||
| Diana M. Bontá | Director |
II-6
EXHIBIT INDEX
| Exhibit | |||
| Number | Description of Exhibit | ||
| 1.01 | * | Form of | |
| 3.01 | Restated Articles of Incorporation, as amended (incorporated by reference to | ||
| 3.02 | Bylaws, as amended (incorporated by reference to Form 8-K filed on January 26, 2007) | ||
| 4.01 | Indenture with respect to Debt Securities, as supplemented | ||
| 4.02 | * | Form of | |
| 5.01 | Opinion of | ||
| 12.01 | Computation of | ||
| 23.01 | Consent of | ||
| 23.02 | Consent of | ||
| 24.01 | Power of | ||
| 25.01 | Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of the Trustee | ||
* Previously filed.
(1) Incorporated hereinTo be filed by amendment or pursuant to a report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and incorporated by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1990, in which
the incorporated document bore the same exhibit number.
(2) Incorporated herein by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1992, in which
the incorporated document bore the same exhibit number.
(3) Incorporated herein by reference to the Registrant's Form 10-K (Commission
File No. 0-1121) with respect to the year ended December 31, 1993, in which
the incorporated document bore the same exhibit number.
(4) Incorporated herein by reference to the Registrant's Form 8-K (Commission
File No. 33-62832) filed on September 1, 1993 in which the incorporated
document bore the same exhibit number.