Section 69. Approval of issues of stock, bonds and other forms of indebtedness; approval of mergers or consolidations

A gas  corporation
  or   electric   corporation   organized   or   existing,   or  hereafter
  incorporated, under or by virtue of the laws of the state of  New  York,
  may  issue  stocks,  bonds,  notes  or  other  evidences of indebtedness
  payable at periods of more than twelve months after the date thereof, or
  a receiver of such a corporation, if duly authorized by law,  may  issue
  receiver's certificates, when necessary for the acquisition of property,
  including  the stock or bonds of any other corporation incorporated for,
  or engaged in, the same or a similar business,  in  this  state  or  any
  other state, or proposing to operate or operating under a franchise from
  the  same  or  any other municipality, for the construction, completion,
  extension or improvement of its plant or distributing system, or for the
  improvement or maintenance of its service or for the discharge or lawful
  refunding of its obligations or for the reimbursement of moneys actually
  expended from income or from any other moneys in  the  treasury  of  the
  corporation  not  secured  or  obtained from the issue of stocks, bonds,
  notes or other evidences of indebtedness  of  such  corporation,  within
  five  years  next  prior  to  the  filing  of  an  application  with the
  commission for the required authorization,  for  any  of  the  aforesaid
  purposes  except maintenance of service and except replacements in cases
  where the applicant shall have kept its accounts and  vouchers  of  such
  expenditure  in such manner as to enable the commission to ascertain the
  amount of moneys so expended and the purposes for which such expenditure
  was made; provided and not otherwise that there shall have been  secured
  from  the  commission  an  order  authorizing such issue, and the amount
  thereof, and stating the purposes to which the issue or proceeds thereof
  are to be applied, and that, in  the  opinion  of  the  commission,  the
  money, property or labor to be procured or paid for by the issue of such
  stock,  bonds,  notes  or other evidences of indebtedness is or has been
  reasonably required for the purposes specified in the  order,  and  that
  except  as  otherwise permitted in the order in the case of bonds, notes
  and other evidences of indebtedness, such purposes are not in  whole  or
  in  part reasonably chargeable to operating expenses or to income. Stock
  may be issued to stockholders as a stock dividend  provided  that  there
  shall  have  been  secured from the commission an order authorizing such
  issue and a transfer of surplus to capital in an amount equal to the par
  or stated value of the stock so authorized and stating that a sum  equal
  to  the  amount  to  be  so  transferred  was  expended for the purposes
  enumerated in this section. Stock  may  be  issued  to  an  employee  or
  director  of  a  gas  corporation  or electric corporation under a stock
  option plan pursuant to which such corporation  grants  options  to  its
  employees  or  directors to purchase shares of stock, such options to be
  exercisable for a stated period of time to purchase shares of  stock  at
  the  market  value  of  the stock at the time of issuance of the option,
  provided that there shall have been secured from the commission an order
  authorizing such issue and that the proceeds from the  exercise  of  the
  stock  options  are  needed  for  one of the purposes enumerated in this
  section. The issue of stocks, bonds or other evidences of  indebtedness,
  within  the  meaning of this section, shall include the sale by any such
  corporation of any such securities previously issued in compliance  with
  the  provisions  of  this  section  and  subsequently reacquired by such
  corporation, provided, however, for good cause shown the commission  may
  exempt  from the restriction hereof, stocks, bonds or other evidences of
  indebtedness.  For the purpose of enabling it to  determine  whether  it
  should  issue  such  an order, the commission shall make such inquiry or
  investigation, hold such hearings and  examine  such  witnesses,  books,
  papers,  documents or contracts as it may deem of importance in enabling

  it to reach a determination. Such  corporation  shall  not  without  the
  consent  of  the  commission apply said issue or any proceeds thereof to
  any purpose not  specified  in  such  order.  Such  gas  corporation  or
  electric  corporation may issue notes, for proper corporate purposes and
  not in violation of any provision of this or of any other  act,  payable
  at  periods  of not more than twelve months without such consent; but no
  such notes shall, in  whole  or  in  part,  directly  or  indirectly  be
  refunded  by  any  issue  of  stock  or  bonds  or  by  any evidences of
  indebtedness running for more than twelve months without the consent  of
  the  commission.  The  commission shall have power to require every such
  corporation to file with the commission after the  issuance  of  stocks,
  bonds,  notes  or other evidences of indebtedness issued with or without
  the approval of the commission as herein  provided,  a  notice  of  such
  transaction  in  such  form  as  the commission may prescribe. Provided,
  however, that the commission  shall  have  no  power  to  authorize  the
  capitalization of any franchise to be a corporation nor to authorize the
  capitalization  of  any  franchise or the right to own, operate or enjoy
  any franchise whatsoever in excess of the amount (exclusive of  any  tax
  or  annual  charge)  actually  paid  to  the  state  or to any political
  subdivision thereof as the consideration for the grant of such franchise
  or right,  nor  to  authorize  the  issuance  of  any  stocks  or  other
  securities for any purposes other than those enumerated in this section.
  Nor  shall  the  capital  stock of a corporation formed by the merger or
  consolidation of two or more other corporations, exceed the sum  of  the
  capital  stock  of  the  corporations, so consolidated, at the par value
  thereof, or such sum and any additional sum actually paid in  cash;  nor
  shall  any  contract  for  consolidation  or lease be capitalized in the
  stock of any corporation whatever; nor shall any  corporation  hereafter
  issue any bonds against or as a lien upon any contract for consolidation
  or merger.
    A  permission or approval by the public service commission of a merger
  or consolidation shall not be deemed to be an approval of the  value  of
  any  property  or  accounts of any company involved in the merger at the
  time of the merger,  nor  shall  any  such  permission  or  approval  be
  construed  to  be  a certification by the public service commission that
  the  bonds  and/or  capital  stock  of  any  such  merged,  merging   or
  consolidating  corporations  are  represented  in  value by commensurate
  physical assets  of  such  corporations,  nor  shall  such  approval  be
  evidence  as  to the value of any such property or account in subsequent
  rate proceedings or before any court or public body.