WASHINGTON, D.C. – A citywide town hall meeting on the proposed Pepco Holdings-Exelon merger drew a standing-room crowd of about 250 people at the Howard Theatre last night.
The event, which also was live-streamed online, was moderated by Denise Rolark Barnes, publisher of the Washington Informer. David Velazquez, executive vice president of Power Delivery for Pepco Holdings, and Bill Von Hoene, senior executive vice president and chief strategy officer for Exelon, described the merger’s benefits for the District and answered questions, along with Donna Cooper, region president of Pepco, and Melissa Sherrod, vice president of Corporate Affairs for Exelon. Barnes asked the executives to respond to criticism of the merger from opponents before opening questions to audience members in attendance and watching online.
“We have deep roots in the District of Columbia and have been a part of this community for more than 100 years,” said Velazquez, who will be CEO of Pepco Holdings and Pepco after the merger is completed. “We are committed to this community and helping the residents. This merger provides real, tangible and long-term benefits, and we want to provide them to our customers.”
Velazquez and Von Hoene explained that the companies recently reached a merger settlement with the District of Columbia government, Office of the People’s Counsel, Attorney General and others that provides substantially enhanced benefits to District residents, including bill credits, low-income assistance, fewer and shorter outages, a cleaner and greener D.C., and investment in local jobs and the local economy. That settlement is currently being considered by the Public Service Commission of the District of Columbia (PSC).
“We want to be a part of this community, and we have three top-performing utilities that will provide best practices and resources to help Pepco improve the service it delivers to District of Columbia residents,” Von Hoene said. “We will prove Exelon is a company worthy of the District, a company that is committed to the highest levels of performance and customer service, and a company that does right by our customers, communities and the environment.”
The merger has widespread support in the community, as evidenced by the dozens of people who testified about its benefits at the PSC community hearing last month and the tens of thousands of people who have shown their support by signing petitions and sending letters to the PSC. A majority of Council of the District of Columbia members also recognize the substantial benefits to District under the settlement and submitted a letter to the commission encouraging approval of the merger.
The merger has been approved in Maryland, Delaware, New Jersey and Virginia and by federal regulators. The D.C. PSC is the only remaining approval needed. The PSC has set a schedule for completing the proceeding by the first quarter of 2016.
Cautionary Statements Regarding Forward-Looking Information
Except for the historical information contained herein, certain of the matters discussed in this communication constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. Words such as "may," "might," "will," "should," "could," "anticipate," "estimate," "expect," "predict," "project," "future," "potential," "intend," "seek to," "plan," "assume," "believe," "target," "forecast," "goal," "objective," "continue" or the negative of such terms or other variations thereof and words and terms of similar substance used in connection with any discussion of future plans, actions, or events identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding benefits of the proposed merger, integration plans and expected synergies, the expected timing of completion of the transaction, anticipated future financial and operating performance and results, including estimates for growth. These statements are based on the current expectations of management of Exelon Corporation (Exelon) and Pepco Holdings, Inc. (PHI), as applicable. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements included in this communication. For example, (1) the uncertainty surrounding reconsideration of the denial of the Merger application by the DC Public Service Commission may delay the merger or cause the companies to abandon the merger; (2) conditions to the closing of the merger may not be satisfied; (3) problems may arise in successfully integrating the businesses of the companies, which may result in the combined company not operating as effectively and efficiently as expected; (4) the combined company may be unable to achieve cost-cutting synergies or it may take longer than expected to achieve those synergies; (5) the merger may involve unexpected costs, unexpected liabilities or unexpected delays, or the effects of purchase accounting may be different from the companies' expectations; (6) the credit ratings of the combined company or its subsidiaries may be different from what the companies expect; (7) the businesses of the companies may suffer as a result of uncertainty surrounding the merger; (8) the companies may not realize the values expected to be obtained for properties expected or required to be sold; (9) the industry may be subject to future regulatory or legislative actions that could adversely affect the companies; and (10) the companies may be adversely affected by other economic, business, and/or competitive factors. Other unknown or unpredictable factors could also have material adverse effects on future results, performance or achievements of the combined company. Therefore, forward-looking statements are not guarantees or assurances of future performance, and actual results could differ materially from those indicated by the forward-looking statements. Discussions of some of these other important factors and assumptions are contained in Exelon's and PHI's respective filings with the Securities and Exchange Commission (SEC), and available at the SEC's website at www.sec.gov, including: (1) Exelon's 2014 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 22; (2) Exelon's Third Quarter 2015 Quarterly Report on Form 10-Q in (a) Part II, Other Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 19; (3) the definitive proxy statement that PHI filed with the SEC on August 12, 2014 and mailed to its stockholders in connection with the proposed merger (as supplemented by PHI's Form 8-K filed with the SEC on September 12, 2014); (4) PHI's 2014 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 15; and (5) PHI's Third Quarter 2015 Quarterly Report on Form 10-Q in (a) PART I, ITEM 1. Financial Statements, (b) PART I, ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part II, Other Information, ITEM 1A. Risk Factors. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this communication may not occur. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this communication. Neither Exelon nor PHI undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this communication. New factors emerge from time to time, and it is not possible for Exelon or PHI to predict all such factors. Furthermore, it may not be possible to assess the impact of any such factor on Exelon's or PHI's respective businesses or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any specific factors that may be provided should not be construed as exhaustive.