[Federal Register Volume 63, Number 78 (Thursday, April 23, 1998)]
[Notices]
[Page 20247]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-10703]
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
[STB Finance Docket No. 33575]
State of North Carolina--Intracorporate Family Exemption--Merger
of Beaufort and Morehead Railroad Company Into North Carolina Railroad
Company
The State of North Carolina (the State), Beaufort and Morehead
Railroad Company (B&M), and North Carolina Railroad Company (NCRR) have
filed a verified notice of exemption to merge B&M, a Class III rail
carrier wholly owned by the State (a noncarrier),1 into
NCRR, a Class III rail carrier controlled by the State.2
---------------------------------------------------------------------------
\1\ An agency of the State, the North Carolina Department of
Transportation, owns 100% of the outstanding common stock of B&M.
\2\ The State owns approximately 75% of the outstanding common
stock of NCRR.
---------------------------------------------------------------------------
The proposed merger is an element of a financial restructuring, not
subject to Board jurisdiction, related to the proposed buyout by the
State of the private shareholders of NCRR.3 See North
Carolina Railroad Company--Petition to Set Trackage Compensation and
Other Terms and Conditions--Norfolk Southern Railway Company, Norfolk &
Western Railway Company, and Atlantic and East Carolina Railway
Company, STB Finance Docket No. 33134 (STB served May 29,
1997).4 The parties expected to consummate the merger on or
after March 31, 1998.
---------------------------------------------------------------------------
\3\ The merger will allow NCRR to issue new preferred stock in
exchange for B&M preferred stock. The preferred stock issuance will
evidently preserve NCRR's Federal tax status as a real estate
investment trust after the State acquires all of its common stock.
\4\ There, a trackage compensation proceeding was held in
abeyance to allow the State to negotiate a buyout of the private
shareholders of NCRR whose dissension had precipitated the
compensation dispute.
---------------------------------------------------------------------------
This transaction is one within a corporate family of the type
specifically exempted from prior review and approval under 49 CFR
1180.2(d)(3). The parties state that the transaction will not result in
adverse changes in service levels, significant operational changes, or
a change in the competitive balance with carriers outside the corporate
family.
Under 49 U.S.C. 10502(g), the Board may not use its exemption
authority to relieve a rail carrier of its statutory obligation to
protect the interests of its employees. Section 11326(c), however, does
not provide for labor protection for transactions under sections 11324
and 11325 that involve only Class III rail carriers. Because this
transaction involves Class III rail carriers only, the Board, under the
statute, may not impose labor protective conditions for this
transaction.
If the verified notice contains false or misleading information,
the exemption is void ab initio. Petitions to reopen the proceeding to
revoke the exemption under 49 U.S.C. 10502(d) may be filed at any time.
The filing of a petition to reopen will not automatically stay the
transaction.
An original and 10 copies of all pleadings, referring to STB
Finance Docket No. 33575, must be filed with the Surface Transportation
Board, Office of the Secretary, Case Control Unit, 1925 K Street, N.W.,
Washington, DC 20423-0001. In addition, a copy of each pleading must be
served on: Betty Jo Christian, Steptoe & Johnson, 1330 Connecticut
Avenue, N.W., Washington, DC 20036; and Farhana Y. Khera, Hogan &
Hartson L.L.P, 555 Thirteenth Street, N.W., Washington, DC 20004-1109.
Decided: April 15, 1998.
By the Board, David M. Konschnik, Director, Office of
Proceedings.
Vernon A. Williams,
Secretary.
[FR Doc. 98-10703 Filed 4-22-98; 8:45 am]
BILLING CODE 4915-00-P
