File No. 70-8557
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 7 (POST-EFFECTIVE) TO
FORM U-1 APPLICATION-DECLARATION
UNDER THE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
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CENTRAL AND SOUTH WEST CORPORATION SOUTHWESTERN ELECTRIC POWER COMPANY
1616 Woodall Rodgers Freeway 428 Travis Street
Dallas, Texas 75202 Shreveport, Louisiana 71156-0001
CENTRAL POWER AND LIGHT COMPANY WEST TEXAS UTILITIES COMPANY
539 North Carancahua Street 301 Cypress Street
Corpus Christi, Texas 78401-2802 Abilene, Texas 79601-5820
PUBLIC SERVICE COMPANY OF OKLAHOMA CENTRAL AND SOUTH WEST
212 East Sixth Street SERVICES, INC.
Tulsa, Oklahoma 74119-1212 1616 Woodall Rodgers Freeway
Dallas, Texas 75202
CSW ENERGY, INC. CSW INTERNATIONAL, INC.
1616 Woodall Rodgers Freeway 1616 Woodall Rodgers Freeway
Dallas, Texas 75202 Dallas, Texas 75202
CSW COMMUNICATIONS, INC. ENERSHOP, INC.
1705 South Capital of Texas Hwy. 1616 Woodall Rodgers Freeway
Austin, Texas 78746 Dallas, Texas 75202
CSW ENERGY SERVICES, INC.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
(Names of companies filing this statement and addresses
of principal executive offices)
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CENTRAL AND SOUTH WEST CORPORATION
(Name of top registered holding company parent)
---------------------------------
Wendy G. Hargus, Treasurer
Central and South West Corporation
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
Joris M. Hogan, Esq.
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
(Names and addresses of agents for service)
<PAGE>
Central and South West Corporation ("CSW"), a Delaware
Corporation and a registered holding company under the Public Utility Holding
Company Act of 1935, as amended (the "Act"), and its subsidiary companies
Central Power and Light Company ("CPL"), Public Service Company of Oklahoma
("PSO"), Southwestern Electric Power Company ("SWEPCO"), West Texas Utilities
Company ("WTU"), Central and South West Services, Inc. ("CSWS"), CSW Energy,
Inc. ("Energy"), CSW International, Inc. ("CSWI"), CSW Communications, Inc.
("Communications"), EnerShop, Inc. ("EnerShop") and CSW Energy Services, Inc.
("ESI"), each referred to as a "Subsidiary" and collectively referred to as the
"Subsidiaries", hereby file this Post-Effective Amendment No. 7 (this
"Amendment") to the Form U-1 Application-Declaration in File No. 70-8557 to
request authority: (i) to increase the aggregate amount of authorized borrowings
(a) by CSW from $1.2 billion to $2.5 billion, (b) by CPL from $300 million to
$400 million, (c) by PSO from $125 million to $225 million, (d) by SWEPCO from
$150 million to $250 million, (e) by WTU from $65 million to $165 million, and
(f) by CSWS from $110 million to $210 million; and (ii) either (a) for Energy,
CSWI, Communications, EnerShop, ESI and any other existing or future CSW first
tier subsidiary or Rule 58 company that CSW may wish to include (collectively,
the "New Participants") to participate in the system of intercorporate
borrowings under the CSW system money pool (the "System Money Pool") or (b) for
CSW and the New Participants to, currently or in the future, form and
participate in a separate system of intercorporate borrowings (the "New
Participants Money Pool") should CSW deem proper the formation of a separate
money pool based on then existing regulatory or business considerations. The
Subsidiaries together with CSW are referred to herein collectively as the
"Applicants".
Item 1. Description of Proposed Transaction.
CSW and the Subsidiaries propose to expand the System Money
Pool, as previously authorized by orders HCAR Nos. 25777 (March 31, 1993), 25897
(September 28, 1993), 26007 (March 18, 1994), 26066 (June 15, 1994), 26226
(February 1, 1995), 26254 (March 21, 1995) and 26697 (March 28, 1997), by
increasing the borrowing limits of the existing participants and by permitting
the New Participants to make loans to, and borrow from, the System Money Pool.
CSW and the New Participants also request authority to form and participate in
the New Participants Money Pool should CSW deem proper the formation of a
separate money pool based on then existing regulatory or business
considerations, in which case the System Money Pool and the New Participants
Money Pool will both be supported by CSW's increased authorized borrowing level
hereunder. New Participants
Energy is primarily engaged in the development, ownership and
operation of exempt wholesale generators ("EWGs"), as defined in Section 32 of
the Act, and qualifying facilities ("QFs") under the Public Utility Regulatory
Policy Act of 1978, as amended, as authorized by the following orders: HCAR Nos.
25162 (Sept. 28, 1990), 25414 (Nov. 22, 1991), 25728 (Dec. 31, 1992) and 26417
(Nov. 28, 1995) in File No. 70-7758; HCAR Nos. 26156 (Nov. 3, 1994) and 26383
(Sept. 27, 1995) in File No. 70-8423; and HCAR No. 26653 (Jan. 24, 1997) in File
No. 70-8809. Energy is also permitted to engage in certain other activities
pursuant to the aforementioned orders. In addition, Energy is also permitted to
engage in certain other activities related to specific projects pursuant to the
following orders: HCAR No. 25516 (Apr. 16, 1992) in File No. 70-7852; HCAR Nos.
25399 (Nov. 1, 1991) and 25553 (June 11, 1992) in File No. 70-7867; HCAR Nos.
25477 (Feb. 18, 1992), 25599 (Aug. 6, 1992) and 25762 (Mar. 19, 1993) in File
No. 70-7918; HCAR No. 25782 (Apr. 2, 1993) in File No. 70-8097; HCAR Nos. 25796
(Apr. 15, 1993), 25988 (Feb. 9, 1994) and 26626 (Dec. 13, 1996) in File No.
70-8133; HCAR Nos. 25866 (Aug. 6, 1993) and 26416 (Nov. 28, 1995) in File No.
70-8205; HCAR No. 26155 (Nov. 2, 1994) in File No. 70-8209; HCAR Nos. 26184
(Dec. 9, 1994), 26522 (May 29, 1996) and 26614 (Nov. 26, 1996) in File No.
70-8469; and HCAR No. 26177 (Nov. 30, 1994) in File No. 70-8483.
CSWI is primarily engaged in the development, ownership and
operation of foreign EWGs and the investment in, and ownership and operation of,
foreign utility companies ("FUCOs"), as defined in Section 33 of the Act, and
certain other permitted activities, as authorized by the following orders: HCAR
Nos. 26156 (Nov. 3, 1994) and 26383 (Sept. 27, 1995) in File No. 70-8423; and
HCAR No. 26653 (Jan. 24, 1997) in File No. 70-8809.
Energy and CSWI also intend to engage, indirectly through Rule
58 subsidiaries and foreign service companies, respectively, in various
energy-related businesses in the United States and abroad (such foreign
activities by foreign service companies outside of the United States are subject
to separate Commission approval, which has been requested by post-effective
amendment to the Form U-1 Application-Declaration in File No. 70-8423).
In addition to using the System Money Pool as a source of
short-term funds for their general corporate purposes and in connection with
other permitted activities, Energy and CSWI propose to use the System Money Pool
as a source of interim funding for investment in EWGs and FUCOs. Separate from
CSW's authority to incur borrowings in support of the System Money Pool, CSW was
authorized by order dated January 24, 1997 (HCAR No. 26653 in File No. 70-8809)
(the "Financing Order") to incur borrowings or issue securities, including
commercial paper, to finance investment in EWGs and FUCOs in an aggregate amount
up to 100% of its consolidated retained earnings (the "Aggregate Limit").
Thus, Energy and CSWI are requesting authority to use
borrowings from the System Money Pool, as a substitute for or in addition to
direct borrowings by CSW under the Financing Order, for general corporate
purposes and other permitted activities and as a means of interim financing for
investment in EWGs and FUCOs. At present, under the Financing Order, CSW can
borrow (or issue securities) to fund investments in EWGs and FUCOs up to the
Aggregate Limit, and CSW can borrow for other purposes and to support the System
Money Pool in an amount up to $1.2 billion pursuant to the order issued in File
No. 70-8557, such that there are two separate sources of authority for CSW's
borrowings for these two distinct purposes. This Amendment will maintain the
separation of these sources of authority to borrow since CSW will retain
separate authority to borrow to finance investments in EWGs and FUCOs under the
Financing Order. Thus, if the Commission grants the Applicants' request herein,
CSW would be authorized to borrow $2.5 billion in support of the System Money
Pool in addition to an amount of borrowings (or issuances of securities) equal
to the available authority under the Aggregate Limit of the Financing Order. Any
borrowings (or issuances of securities) by CSW for the purpose of financing
investment in EWGs and FUCOs will be made only under the Financing Order and
will count only toward the Aggregate Limit; borrowings by CSW for other purposes
and to support System Money Pool borrowings will be made only under the
authority requested herein and will count only toward the borrowing limits set
forth herein.
Communications is an exempt telecommunications company ("ETC")
under Section 34 of the Act and is engaged, directly and indirectly, in the
business of providing telecommunications and information services.
Communications proposes to use System Money Pool borrowings for general
corporate purposes, and as interim financing for the expansion of its business
and the acquisition of other ETCs from third parties.
EnerShop is engaged in the business of providing demand-side
management services to industrial and commercial customers of both associate and
nonassociate companies as authorized by the following order: HCAR No. 26367
(Sept. 1, 1995) in File No. 70-8645 (the "EnerShop Order"). EnerShop proposes to
use System Money Pool borrowings for general corporate purposes, and as interim
financing for the expansion of its business and investments in energy-related
companies under Rule 58 under the Act.
ESI, which is expected to be organized prior to the time that
the Commission takes action on this application, will qualify as an
energy-related company under Rule 58, and will be primarily engaged in the
business of marketing and brokering energy commodities, as well as other
activities permitted by Rule 58. ESI would use System Money Pool borrowings for
general corporate purposes, and as interim financing for the expansion of its
business and investments in other energy-related businesses permitted under Rule
58.
CSW system companies may from time to time organize additional
Rule 58 companies, and CSW may from time to time organize additional first tier
subsidiaries pursuant to an exemption under the Act or further Commission
authorization. In either case, CSW proposes that any such new subsidiaries would
be eligible to participate as New Participants in the System Money Pool or the
New Participants Money Pool, as the case may be. Borrowing Limits
CSW requests that the maximum aggregate amount of its
short-term borrowings be increased from $1.2 billion to $2.5 billion for the
following purposes:
(i) to cover incremental borrowings of the New Participants.
(ii) to provide authority for CSW to issue commercial paper
for interim financing of acquisitions and investments consistent with
the conversion of CSW's commercial paper program from one based upon
the exemption provided by Section 3(a)(3) of the Securities Act of 1933
to a program based upon the Section 4(2) exemption thereunder (the
"Money Pool Conversion"). Under Section 3(a)(3), CSW could only issue
commercial paper for purposes of "current transactions", which limited
its ability to use the System Money Pool as a source of interim
financing for acquisitions and investments. In contrast, under Section
4(2), the amount of commercial paper that CSW can issue is not limited,
nor are the use of proceeds. The Applicants propose to use commercial
paper issuances and other borrowings that may be authorized by the
Commission in this file as a source of interim financing for
acquisitions and investments (other than for EWGs and FUCOs) by CSW and
the participants in the System Money Pool. As set forth hereinabove,
borrowings (including commercial paper issuances) to finance investment
in EWGs and FUCOs would be conducted pursuant to authority provided by
the Financing Order.
(iii) to allow CSW to utilize its proposed additional
borrowing capacity as a source of interim funding for open market
repurchases of its common stock (subject to separate authorization by
the Commission in File No. 70-9105); and
(iv) to support the proposed increased limits of the existing
parties to the System Money Pool. CPL seeks to increase its limit on
System Money Pool borrowings from $300 million to $400 million, PSO
seeks to increase its limit on System Money Pool borrowings from $125
million to $225 million, SWEPCO seeks to increase its limit on System
Money Pool borrowings from $150 million to $250 million, WTU seeks to
increase its limit on System Money Pool borrowings from $65 million to
$165 million, and CSWS seeks to increase its limit on System Money Pool
borrowings from $110 million to $210 million. CPL, PSO, SWEPCO and WTU
each may utilize their proposed additional borrowing capacity for
general corporate purposes and as a source of interim financing for the
reacquisition of their respective securities. CSWS may utilize its
proposed additional borrowing capacity for general corporate purposes
and to refinance currently outstanding bank borrowings.
CSW and the existing parties to the System Money Pool shall
have authorized aggregate borrowing limits at the following levels:
CSW $ 2,500,000,000
CPL $ 400,000,000
PSO $ 225,000,000
SWEPCO $ 250,000,000
WTU $ 165,000,000
CSWS $ 210,000,000
System Money Pool borrowings by the New Participants are either limited by order
of the Commission, limited by Rule under the Act, or are not limited by Congress
under the Act, such that separate limits on such borrowings are, in each case,
as set forth below:
(i) Energy's borrowings are subject to separate limits
depending upon the purpose to which the funds are invested. If the
funds are used to invest in EWGs and FUCOs, like CSWI, Energy's
borrowings are limited by the Aggregate Limit of the Financing Order.
If the funds are used to invest in QFs or other Rule 58 companies,
Energy's borrowings may not exceed the aggregate investment limit under
Rule 58.
(ii) System Money Pool borrowings by CSWI may not exceed the
amount of available authority under the Aggregate Limit of the
Financing Order and the amount of CSWI's financing authority under
other orders of the Commission (e.g., existing and future orders in
File No. 70-8423).
(iii) CSW's investment in Communications, as well as CSW's
issuance of securities to fund such investments, are not limited under
the Act.
(iv) Investments and other financing by CSW related to
EnerShop are limited to $100 million in the aggregate under the
EnerShop Order so that System Money Pool borrowings by EnerShop also
will be subject to the financing limit contained in the EnerShop Order
(as such limit may be adjusted by any future orders of the Commission
affecting the EnerShop Order).
(v) ESI's System Money Pool borrowings are limited by the
aggregate investment limit under Rule 58.
Separate Money Pool for New Participants
The electric utility industry is experiencing rapid changes in
its regulatory environment. Many states are in the process of adopting
comprehensive legislation regulating electric utilities within their
jurisdictions. In addition, proposals to repeal the Act are currently pending in
both houses of Congress. Given the uncertainty of the regulatory environment,
CSW would like the flexibility to establish a New Participants Money Pool,
either upon receipt of an Order hereunder or in the future, if then existing
regulatory or other business considerations warrant. If and when a New
Participants Money Pool is established, the New Participants would not
participate in the System Money Pool, but CSW would rely on its increased
authorized borrowing levels hereunder to support the System Money Pool and the
New Participants Money Pool.
A New Participants Money Pool would be established and
administered in the same manner and subject to the same conditions as the System
Money Pool. The aggregate borrowing limits under the New Participants Money Pool
and the System Money Pool would not exceed the aggregate borrowing limit under
the System Money Pool in effect immediately prior to establishment of the New
Participants Money Pool. Benefits
The participation of the New Participants in the System Money
Pool would permit their available cash and/or short-term borrowing requirements
to be matched on a daily basis with those of the other participants in the
System Money Pool, thereby minimizing the need of the CSW system for external
short-term borrowing. If the New Participants are authorized to participate in
the System Money Pool, funds will be loaned from the System Money Pool in the
form of open account advances under the same terms and limitations as currently
authorized. Item 2. Fees, Commissions and Expenses.
An estimate of the fees and expenses to be paid or incurred by
the Applicants in connection with the proposed transactions additional to the
fees and expenses as previously set forth in the Application-Declaration is set
forth below:
Amount
--------
Counsel fees:
Milbank, Tweed, Hadley & McCloy
New York, New York....................... $ 6,000
Miscellaneous and incidental expenses
including travel, telephone and
postage.................................. 1,000
--------
Total $ 7,000
========
Item 3. Applicable Statutory Provisions.
Sections 6(a), 7, 9(a), 10, and 12(b) and Rules 43 and 45
thereunder are or may be applicable to the proposed transactions. To the extent
any other sections of the Act may be applicable to the proposed transactions,
the Applicants hereby request appropriate orders thereunder.
The Applicants believe the Commission's supplemental order dated
July 18, 1997 in favor of Consolidated Natural Gas Company, et al. (HCAR No.
26742; File No. 70-7258) provides precedent for the participation of non-utility
subsidiaries in the system money pool of a registered holding company.
Rule 54. Proceeds from the securities issuances that are
proposed to be made under the authority requested herein may be used by CSW or
any subsidiary thereof for the direct or indirect acquisition of an interest in
an EWG or a FUCO. As stated above, CSW was authorized in the Financing Order to
issue commercial paper, among other securities, to finance the acquisition of
interests in EWGs and FUCOs in an aggregate amount up to 100% of its
consolidated retained earnings as defined in Rule 53. As the Commission already
has granted CSW authority to issue commercial paper to finance the acquisition
of EWGs and FUCOs, CSW is not seeking such authority herein, and will not use
the authority granted herein for such purposes.
In this Amendment, CSW seeks to integrate the commercial paper
issuance authority granted in the Financing Order with its commercial paper
program in support of the System Money Pool. This integration is facilitated by
the System Money Pool Conversion. Thus, when CSW issues commercial paper to
finance the acquisition of EWGs and FUCOs by Energy and CSWI, it will be issuing
securities under authority provided by the Financing Order (which was already
approved by the Commission under Rule 53(c)), not in reliance on any authority
that may be granted in respect of this Amendment. Open account advances between
participants in the System Money Pool do not involve the issue or sale of a
security under the Act and thus do not implicate Rule 54.
Rule 54 promulgated under the Act states that in determining
whether to approve the issue or sale of a security by a registered holding
company for purposes other than the acquisition of an EWG or a FUCO, or other
transactions by such registered holding company or its subsidiaries other than
with respect to EWGs or FUCOs, the Commission shall not consider the effect of
the capitalization or earnings of any subsidiary which is an EWG or a FUCO upon
the registered holding company system if Rule 53(a), (b) and (c) are satisfied.
As set forth below, all applicable conditions set forth in Rule 53(a) are
currently satisfied and none of the conditions set forth in Rule 53(b) exist or
will exist as a result of the transactions proposed herein.
CSW's "aggregate investment" (as defined under Rule 53(a) of
the Act) in EWGs and FUCOs as of September 11, 1997 was approximately $921
million, or about 47% of $1,970 million, CSW's average "consolidated retained
earnings" for the four consecutive quarterly periods ended June 30, 1997. CSW
thus satisfies Rule 53(a)(1). CSW will maintain and make available the books and
records required by Rule 53(a)(2). No more than 2% of the employees of CSW's
domestic operating subsidiaries will, at any one time, directly or indirectly,
render services to an EWG or FUCO in which CSW directly or indirectly owns an
interest, satisfying Rule 53(a)(3). And lastly, CSW will submit a copy of Item 9
and Exhibits G and H of CSW's Form U5S to each of the public service commissions
having jurisdiction over the retail rates of CSW's operating utility
subsidiaries, satisfying Rule 53(a)(4).
None of the conditions described in Rule 53(b) exist with
respect to CSW or any of its subsidiaries, thereby satisfying such rule and
making Rule 53(c) inapplicable.
CSW was authorized in the Financing Order to invest up to 100%
of its consolidated retained earnings in EWGs and FUCOs. In connection with its
consideration of CSW's application for the Financing Order, the Commission
reviewed CSW's procedures for evaluating EWG or FUCO investments. Based on
projected financial ratios and on procedures and conditions established to limit
the risks to CSW involved with investments in EWGs and FUCOs, the Commission
determined that permitting CSW to invest up to 100% of its consolidated retained
earnings in EWGs and FUCOs would not have a substantial adverse impact upon the
financial integrity of the CSW system, nor would it have an adverse impact on
any of the Subsidiaries or their customers, or on the ability of State
commissions to protect the Subsidiaries or their customers. Since similar
considerations are involved hereunder with respect to Rule 54, Applicants should
not be required to make subsequent Rule 54 filings once CSW's aggregate
investment in EWGs and FUCOs exceeds 50% of its consolidated retained earnings.
Item 4. Regulatory Approval.
No state regulatory authority and no federal regulatory
authority, other than the Commission under the Act, have jurisdiction over the
proposed transactions.
Item 5. Procedure.
It is requested that the Commission issue and publish no later
than October 3, 1997, the requisite notice under Rule 23 with respect to the
filing of this Amendment, such notice to specify a date not later than October
27, 1997, as the date after which an order granting and permitting this amended
Application-Declaration to become effective may be entered by the Commission and
that the Commission enter not later than October 28, 1997, an appropriate order
granting and permitting this amended Application-Declaration to become
effective.
The Applicants respectfully request that appropriate and
timely action be taken by the Commission in this matter.
No recommended decision by a hearing officer or other
responsible officer of the Commission is necessary or required in this matter.
The Division of Investment Management of the Commission may assist in the
preparation of the Commission's decision in this matter. There should be no
thirty-day waiting period between the issuance and the effective date of any
order issued by the Commission in this matter, and it is respectfully requested
that any such order be made effective immediately upon the entry thereof.
Item 6. Exhibits and Financial Statements.
Exhibit 1 - Preliminary opinion of Milbank, Tweed,
Hadley & McCloy, counsel to the Applicants.
Exhibit 2 - Financial statements as of June 30, 1997
of CSW and Subsidiaries.
Exhibit 3 - Proposed Notice of Proceeding.
Item 7. Information as to Environmental Effects.
The Commission's action in this matter will not constitute any
major federal action having a significant effect on the human environment. To
the best of CSW's knowledge, no federal agency has prepared or is preparing an
environmental impact statement with respect to the proposed transactions.
<PAGE>
S I G N A T U R E
- - - - - - - - -
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, as amended, the undersigned companies have duly caused this
document to be signed on their behalf by the undersigned thereunto duly
authorized.
Dated: September 30, 1997
CENTRAL AND SOUTH WEST CORPORATION
CENTRAL POWER AND LIGHT COMPANY
PUBLIC SERVICE COMPANY OF OKLAHOMA
SOUTHWESTERN ELECTRIC POWER COMPANY
WEST TEXAS UTILITIES COMPANY
CENTRAL AND SOUTH WEST SERVICES, INC.
CSW ENERGY, INC.
CSW INTERNATIONAL, INC.
CSW COMMUNICATIONS, INC.
ENERSHOP, INC.
CSW ENERGY SERVICES, INC.
By:/s/ WENDY G. HARGUS
Wendy G. Hargus
Treasurer
<PAGE>
INDEX OF EXHIBITS
EXHIBIT TRANSMISSION
NUMBER EXHIBIT METHOD
- ------- ------- ------------
1 Preliminary opinion of Milbank, Electronic
Tweed, Hadley & McCloy, counsel
to the Applicants.
2 Financial statements as of June 30, 1997 Electronic
of CSW and Subsidiaries.
3 proposed Notice of Proceeding. Electronic
EXHIBIT 1
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
September 30, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Central and South West Corporation, et al.
Post-Effective Amendment No. 7 to
Form U-1 Application-Declaration
Dear Sirs:
We refer to Post-Effective Amendment No. 7 (the "Amendment")
to the Form U-1 Application-Declaration (collectively with the Amendment, the
"Application") under the Public Utility Holding Company Act of 1935, as amended
(the "1935 Act"), filed by Central and South West Corporation ("CSW"), a
Delaware corporation and a registered holding company, and Central and South
West Services, Inc. ("Services"), a Texas corporation, Central Power and Light
Company ("CPL"), a Texas corporation, Public Service Company of Oklahoma
("PSO"), an Oklahoma corporation, Southwestern Electric Power Company
("SWEPCO"), a Delaware corporation, West Texas Utilities Company ("WTU"), a
Texas corporation, CSW Energy, Inc. ("Energy"), a Texas corporation, CSW
International, Inc. ("CSWI"), a Delaware corporation, CSW Communications, Inc.
("Communications"), a Delaware corporation, CSW Energy Services, Inc. ("ESI"), a
Delaware corporation, and EnerShop, Inc. ("EnerShop" and, collectively with CSW,
Services, CPL, PSO, SWEPCO, WTU, Energy, CSWI, Communications and ESI, the
"Companies"), a Delaware corporation. The Amendment relates to the Companies'
request for authority to Energy, CSWI, Communications, EnerShop, ESI and future
CSW first tier subsidiaries or Rule 58 companies to lend and borrow money as
participants in the CSW System money pool or to lend and borrow money as
participants in a separate money pool (the "Transactions"), as more fully
described in the Amendment. We have acted as special counsel for the Companies
in connection with the filing of the Amendment.
We have examined originals, or copies certified to our
satisfaction, of such corporate records of the Companies, certificates of public
officials, certificates of officers and representatives of the Companies and
other documents as we have deemed it necessary to require as a basis for the
opinions hereinafter expressed. In such examination we have assumed the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals and the conformity with the originals of all documents submitted
to us as copies. As to various questions of fact material to such opinions we
have, when relevant facts were not independently established, relied upon
certificates by officers of the Companies and other appropriate persons and
statements contained in the Application.
Based upon the foregoing, and having regard to legal
considerations which we deem relevant, we are of the opinion that, in the event
that the proposed Transactions are consummated in accordance with the
Application, as it may be amended, and subject to the assumptions and conditions
set forth below:
1. All state laws applicable to the proposed Transactions as
described in the Amendment will have been complied with.
2. The consummation of the proposed Transactions as described
in the Amendment will not violate the legal rights of the lawful
holders of any securities issued by the Companies or any associate
company of the Companies.
The opinions expressed above in respect of the proposed
Transactions as described in the Amendment are subject to the following
assumptions or conditions:
a. The Transactions shall have been duly authorized and
approved to the extent required by state law by the
Board of Directors of the Companies.
b. The Securities and Exchange Commission shall have
duly entered an appropriate order or orders granting
and permitting the Amendment to become effective with
respect to the Transactions described therein.
c. The Transactions shall have been accomplished in
accordance with required approvals, authorizations,
consents, certificates and orders of any state
commission or regulatory authority with respect
thereto and all such required approvals,
authorizations, consents, certificates and orders
shall have been obtained and remain in effect at the
closing thereof.
d. No act or event other than as described herein shall
have occurred subsequent to the date hereof which
would change the opinions expressed above.
We hereby consent to the use of this opinion as an exhibit to
the Amendment.
Very truly yours,
MILBANK, TWEED, HADLEY & McCLOY
INDEX EXHIBIT 2
TO
FINANCIAL STATEMENTS Page
Number
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARY COMPANIES
Consolidated Balance Sheets - Per Books and Pro Forma
as of June 30, 1997 3 - 4
Consolidated Statement of Income for the Twelve Months Ended
June 30, 1997 5
Consolidated Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 6
CENTRAL AND SOUTH WEST CORPORATION (CORPORATE)
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 7
Statement of Income for the Twelve Months Ended June 30, 1997 8
CENTRAL POWER AND LIGHT COMPANY
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 9 - 10
Statement of Income for the Twelve Months Ended June 30, 1997 11
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 12
PUBLIC SERVICE COMPANY OF OKLAHOMA
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 13 - 14
Statement of Income for the Twelve Months Ended June 30, 1997 15
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 16
SOUTHWESTERN ELECTRIC POWER COMPANY
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 17 - 18
Statement of Income for the Twelve Months Ended June 30, 1997 19
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 20
WEST TEXAS UTILITIES COMPANY
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 21 - 22
Statement of Income for the Twelve Months Ended June 30, 1997 23
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 24
CENTRAL AND SOUTH WEST SERVICES, INC.
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 25 - 26
Statement of Income for the Twelve Months Ended June 30, 1997 27
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 28
<PAGE>
INDEX
TO
FINANCIAL STATEMENTS
Page
(CONTINUED) Number
CSW ENERGY, INC.
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 29
Statement of Income for the Twelve Months Ended June 30, 1997 30
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 31
CSW INTERNATIONAL, INC.
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 32
Statement of Income for the Twelve Months Ended June 30, 1997 33
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 34
CSW COMMUNICATIONS, INC.
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 35 - 36
Statement of Income for the Twelve Months Ended June 30, 1997 37
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 38
ENERSHOP INC.
Balance Sheets - Per Books and Pro Forma as of June 30, 1997 39
Statement of Income for the Twelve Months Ended June 30, 1997 40
Statement of Retained Earnings for the Twelve Months Ended
June 30, 1997 41
PRO FORMA ADJUSTMENTS TO BALANCE SHEETS 42
STATEMENT OF CHANGES 43
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 44
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
Production $5,800 $5,800
Transmission 1,553 1,553
Distribution 4,321 4,321
General 1,369 1,369
Construction work in progress 185 185
Nuclear fuel 193 193
Other Diversified 171 171
--------------------------------
13,592 13,592
Less - Accumulated depreciation 5,050 5,050
--------------------------------
8,542 8,542
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 268 268
Accounts receivable 1,004 1,004
Materials and supplies, at average cost 181 181
Electric fuel inventory 83 83
Under-recovered fuel costs 59 59
Prepayments and other 86 86
--------------------------------
1,681 1,681
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS
Deferred plant costs 506 506
Mirror CWIP asset - net 292 292
Other non-utility investments 343 343
Income tax related regulatory assets, net 236 236
Goodwill 1,463 1,463
Other 360 360
--------------------------------
3,200 3,200
--------------------------------
$13,423 $0 $13,423
================================
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common Stock Equity -
Common stock, $3.50 par value,
authorized 350,000,000 shares;
issued and outstanding 212,200,000 shares $743 $743
Paid-in capital 1,039 1,039
Retained earnings 1,887 1,887
Foreign currency translation and other 38 38
--------------------------------
Total Common Stock Equity 3,707 3,707
--------------------------------
Preferred stock
Not subject to mandatory redemption 176 176
Subject to mandatory redemption 28 28
Subsidiary obligated, mandatorily redeemable,
trust preferred securities 324 324
Long-term debt 3,979 3,979
--------------------------------
Total Capitalization 8,214 8,214
--------------------------------
CURRENT LIABILITIES
Long-term debt/preferred stock
due within twelve months 204 204
Short-term debt 400 400
Short-term debt - CSW Credit 708 708
Loan Notes 67 67
Accounts payable 494 494
Accrued taxes 245 245
Accrued interest 102 102
Other 249 249
--------------------------------
2,469 2,469
--------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes 2,244 2,244
Investment tax credits 284 284
Other 212 212
--------------------------------
2,740 2,740
--------------------------------
$13,423 $0 $13,423
================================
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
OPERATING REVENUES $5,135
-----------
OPERATING EXPENSES AND TAXES
U.S. Electric fuel and purchased power 1,215
United Kingdom Cost of Sales 1,295
Operating and maintenance 1,064
Depreciation and amortization 468
Taxes, other than income 183
Income taxes 178
-----------
4,403
-----------
OPERATING INCOME 732
-----------
OTHER INCOME AND DEDUCTIONS 34
-----------
INCOME BEFORE INTEREST CHARGES 766
-----------
INTEREST AND OTHER CHARGES
Interest on long-term debt 332
Distributions on trust preferred securities 4
Interest on short-term debt and other 75
-----------
411
-----------
INCOME FROM CONTINUING OPERATIONS 355
-----------
DISCONTINUED OPERATIONS
Gain on the sale of discontinued
operations, net of tax of $0.3 8
-----------
NET INCOME 363
Less: preferred stock dividends 16
Gain on reacquired preferred stock 10
-----------
NET INCOME FOR COMMON STOCK $357
===========
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
RETAINED EARNINGS AT JUNE 30, 1996 $1,897
Add: Net income for common stock 357
-----------
2,254
-----------
Deduct: Common stock dividends 367
Retained earnings adjustment 0
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $1,887
===========
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
General $1 $1
Less - Accumulated depreciation (1) (1)
--------------------------------
NET PLANT 0 0
INVESTMENTS IN COMMON STOCK
OF SUBSIDIARY COMPANIES (at equity) 4,044 4,044
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 15 15
Accounts and interest receivable - Affiliated 106 106
Prepayments and other 4 4
--------------------------------
125 125
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS 14 14
--------------------------------
$4,183 $0 $4,183
================================
CAPITALIZATION
Common Stock Equity -
Common stock, $3.50 par value;
authorized 350,000,000 shares;
issued and outstanding 212,200,000 shares $743 $743
Paid-in capital 1,039 1,039
Retained earnings 1,887 1,887
Foreign currency translation and other 3 3
--------------------------------
Total Common Stock Equity 3,672 3,672
--------------------------------
Long-term debt 0 0
--------------------------------
Total Capitalization 3,672 3,672
--------------------------------
CURRENT LIABILITIES
Short-term debt 400 400
Accounts payable and other 123 123
--------------------------------
523 523
--------------------------------
DEFERRED CREDITS (12) (12)
--------------------------------
$4,183 $0 $4,183
================================
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
INCOME
Equity in earnings of subsidiaries
Central Power and Light Company $121
Public Service Company of Oklahoma 69
Southwestern Electric Power Company 86
West Texas Utilities Company 25
SEEBOARD U.S.A. 103
CSW Credit, Inc. 8
CSW Energy, Inc. 6
CSW Leasing, Inc. 1
CSW International, Inc. (1)
CSW Communications, Inc. (6)
Enershop Inc. (2)
Central and South West Services, Inc. 0
Other Income 20
----------
$430
----------
EXPENSES AND TAXES
General and administrative expenses 60
Depreciation and amortization expense 1
Interest expense 42
Taxes, other than income 2
Federal income taxes (24)
----------
81
----------
DISCONTINUED OPERATIONS
Gain on sale of discontinued operations, net of
tax of $0.3 8
----------
NET INCOME $357
==========
<PAGE>
CENTRAL POWER AND LIGHT COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
Production $3,110 $3,110
Transmission 509 509
Distribution 984 984
General 281 281
Construction work in progress 84 84
Nuclear fuel 193 193
--------------------------------
5,161 5,161
Less - Accumulated depreciation
and amortization 1,759 1,759
--------------------------------
3,402 3,402
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 26 26
Accounts receivable 146 146
Under-recovered fuel costs 31 31
Materials and supplies, at average cost 73 73
Fuel inventory 11 11
Prepayments and other 6 6
--------------------------------
293 293
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS
Deferred STP costs 486 486
Mirror CWIP asset 292 292
Income tax related regulatory assets, net 329 329
Other 102 102
--------------------------------
1,209 1,209
--------------------------------
$4,904 $0 $4,904
================================
<PAGE>
CENTRAL POWER AND LIGHT COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustment Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock, $25 par value;
authorized 12,000,000 shares;
issued and outstanding 6,755,535 shares $169 $169
Paid-in capital 405 405
Retained earnings 855 855
--------------------------------
Total common stock equity 1,429 1,429
Preferred stock
Not subject to mandatory redemption 163 163
CPL obligated, mandatorily redeemable,
trust preferred securities 145 145
Long-term debt 1,327 1,327
--------------------------------
Total capitalization 3,064 3,064
--------------------------------
CURRENT LIABILITIES
Long-term debt due within twelve months 200 200
Payables to affiliates 23 23
Accounts payable 83 83
Accrued taxes 67 67
Accumulated deferred income taxes 9 9
Accrued interest 31 31
Refund due customers 99 99
Other 32 32
--------------------------------
544 544
--------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes 1,137 1,137
Investment tax credits 144 144
Other 15 15
--------------------------------
1,296 1,296
--------------------------------
$4,904 $0 $4,904
================================
<PAGE>
CENTRAL POWER AND LIGHT COMPANY
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
ELECTRIC OPERATING REVENUE $1,301
-----------
OPERATING EXPENSES AND TAXES
Fuel 349
Purchased power 58
Other operating 287
Maintenance 53
Depreciation and amortization 149
Taxes, other than income 76
Income taxes 76
-----------
1,048
-----------
OPERATING INCOME 253
-----------
OTHER INCOME AND DEDUCTIONS
Other 3
-----------
3
-----------
INCOME BEFORE INTEREST CHARGES 256
-----------
INTEREST AND OTHER CHARGES
Interest on long-term debt 110
Distributions on trust preferred securities 2
Interest on short-term debt and other 14
-----------
126
-----------
NET INCOME 130
Less: preferred stock dividends 12
Gain on reacquired preferred stock 3
-----------
NET INCOME FOR COMMON STOCK $121
===========
<PAGE>
CENTRAL POWER AND LIGHT COMPANY
STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
RETAINED EARNINGS AT JUNE 30, 1996 $858
Add: Net income (loss) for common stock 121
-----------
979
Deduct: Common stock dividends 124
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $855
===========
<PAGE>
PUBLIC SERVICE COMPANY OF OKLAHOMA
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
Production $903 $903
Transmission 372 372
Distribution 800 800
General 204 204
Construction work in progress 39 39
--------------------------------
2,318 2,318
Less - Accumulated depreciation 1,016 1,016
--------------------------------
1,302 1,302
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 5 5
Accounts receivable 32 32
Materials and supplies, at average cost 34 34
Fuel inventory 16 16
Accumulated deferred income taxes 6 6
Prepayments 5 5
--------------------------------
98 98
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS 65 65
--------------------------------
$1,465 $0 $1,465
================================
<PAGE>
PUBLIC SERVICE COMPANY OF OKLAHOMA
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock, $15 par value;
authorized 11,000,000 shares;
issued 10,482,000 shares;
outstanding 9,013,000 shares $157 $157
Paid-in capital 180 180
Retained earnings 156 156
--------------------------------
Total common stock equity 493 493
Preferred stock 5 5
PSO obligated, mandatorily redeemable,
trust preferred securities 73 73
Long-term debt 421 421
--------------------------------
Total capitalization 992 992
--------------------------------
CURRENT LIABILITIES
Payable to affiliates 24 24
Accounts payable 43 43
Payables to customers 15 15
Accrued taxes 27 27
Accrued interest 9 9
Other 5 5
--------------------------------
123 123
--------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes 254 254
Investment tax credits 42 42
Income tax related regulatory
liabilities, net 44 44
Other 10 10
--------------------------------
350 350
--------------------------------
$1,465 $0 $1,465
================================
<PAGE>
PUBLIC SERVICE COMPANY OF OKLAHOMA
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
ELECTRIC OPERATING REVENUE $728
-----------
OPERATING EXPENSES AND TAXES
Fuel 281
Purchased power 47
Other operating 122
Maintenance 36
Depreciation and amortization 79
Taxes, other than income 28
Income taxes 35
-----------
628
-----------
OPERATING INCOME 100
-----------
OTHER INCOME AND DEDUCTIONS 1
-----------
INCOME BEFORE INTEREST CHARGES 101
-----------
INTEREST AND OTHER CHARGES
Interest on long-term debt 31
Distributions on trust preferred securities 1
Interest on short-term debt and other 3
-----------
35
-----------
NET INCOME 66
Less: preferred stock dividends 1
Gain on reacquisition of preferred stock 4
-----------
NET INCOME FOR COMMON STOCK $69
===========
<PAGE>
PUBLIC SERVICE COMPANY OF OKLAHOMA
STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
RETAINED EARNINGS AT JUNE 30, 1996 $131
Add: Net income (loss) for common stock 69
-----------
200
Deduct: Common stock dividends 44
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $156
===========
<PAGE>
SOUTHWESTERN ELECTRIC POWER COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
Production $1,370 $1,370
Transmission 467 467
Distribution 848 848
General 310 310
Construction work in progress 45 45
--------------------------------
3,040 3,040
Less - Accumulated depreciation 1,189 1,189
--------------------------------
1,851 1,851
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 5 5
Accounts receivable 62 62
Materials and supplies, at average costs 28 28
Fuel inventory 41 41
Under-recovered fuel costs 12 12
Prepayments and other 15 15
--------------------------------
163 163
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS 75 75
--------------------------------
$2,089 $0 $2,089
================================
<PAGE>
SOUTHWESTERN ELECTRIC POWER COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock, $18 par value;
authorized 7,600,000 shares;
issued and outstanding 7,536,640 shares $136 $136
Paid-in capital 245 245
Retained earnings 334 334
--------------------------------
Total common stock equity 715 715
Preferred stock
Not subject to mandatory redemption 5 5
Subject to mandatory redemption 28 28
SWEPCO obligated, mandatorily redeemable,
trust preferred securities 106 106
Long-term debt 548 548
--------------------------------
Total capitalization 1,402 1,402
--------------------------------
CURRENT LIABILITIES
Long-term debt and preferred stock due
within twelve months 4 4
Accounts payable 58 58
Payable to affiliates 62 62
Customer deposits 11 11
Accrued taxes 33 33
Accumulated deferred income taxes 5 5
Accrued interest 14 14
Other 12 12
--------------------------------
199 199
--------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes 376 376
Investment tax credits 69 69
Income tax related regulatory liabilities, net 33 33
Other 10 10
--------------------------------
488 488
--------------------------------
$2,089 $0 $2,089
================================
<PAGE>
SOUTHWESTERN ELECTRIC POWER COMPANY
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
ELECTRIC OPERATING REVENUE $914
-----------
OPERATING EXPENSES AND TAXES
Fuel 382
Purchased power 22
Other Operating 143
Maintenance 44
Depreciation and amortization 94
Taxes, other than income 53
Income taxes 40
-----------
778
-----------
OPERATING INCOME 136
-----------
OTHER INCOME AND DEDUCTIONS 1
-----------
INCOME BEFORE INTEREST CHARGES 137
-----------
INTEREST AND OTHER CHARGES
Interest on long-term debt 43
Distributions on trust preferred securities 1
Interest on short-term debt and other 6
-----------
50
-----------
NET INCOME 87
Less: preferred stock dividends 3
Gain on reacquired preferred stock 2
-----------
NET INCOME FOR COMMON STOCK $86
===========
<PAGE>
SOUTHWESTERN ELECTRIC POWER COMPANY
STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
RETAINED EARNINGS AT JUNE 30, 1996 $310
Add: Net income (loss) for common stock 86
-----------
396
Deduct: Common stock dividends 62
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $334
===========
<PAGE>
WEST TEXAS UTILITIES COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
FIXED ASSETS
Electric utility plant
Production $417 $417
Transmission 206 206
Distribution 355 355
General 101 101
Construction work in progress 16 16
--------------------------------
1,095 1,095
Less - Accumulated depreciation 426 426
--------------------------------
669 669
--------------------------------
CURRENT ASSETS
Cash and temporary cash investments 1 1
Accounts receivable 33 33
Materials and supplies, at average cost 16 16
Fuel inventory, at average cost 8 8
Coal inventory, at LIFO cost 7 7
Under-recovered fuel costs 14 14
Prepayments and other 1 1
--------------------------------
80 80
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS
Deferred Oklaunion costs 21 21
Regulatory assets 10 10
Other 41 41
--------------------------------
72 72
--------------------------------
$821 $0 $821
================================
<PAGE>
WEST TEXAS UTILITIES COMPANY
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock, $25 par value;
authorized 7,800,000 shares;
issued and outstanding 5,488,560 shares $137 $137
Paid-in capital 2 2
Retained earnings 124 124
--------------------------------
Total common stock equity 263 263
Preferred stock
Not subject to mandatory redemption 3 3
Long-term debt 277 277
--------------------------------
Total capitalization 543 543
--------------------------------
CURRENT LIABILITIES
Advances from affiliates 26 26
Payables to affiliates 32 32
Accounts payable 8 8
Accrued taxes 9 9
Accrued interest 5 5
Accumulated deferred income taxes 2 2
Other 2 2
--------------------------------
84 84
--------------------------------
DEFERRED CREDITS
Accumulated deferred income taxes 145 145
Investment tax credits 29 29
Investment tax related regulatory
liabilities, net 16 16
Other 4 4
--------------------------------
194 194
--------------------------------
$821 $0 $821
================================
<PAGE>
WEST TEXAS UTILITIES COMPANY
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
ELECTRIC OPERATING REVENUE $379
-----------
OPERATING EXPENSES AND TAXES
Fuel 124
Purchased power 38
Other Operating 76
Maintenance 14
Depreciation and amortization 41
Taxes, other than income 24
Income taxes 14
-----------
331
-----------
OPERATING INCOME 48
-----------
OTHER INCOME AND DEDUCTIONS 1
-----------
INCOME BEFORE INTEREST CHARGES 49
-----------
INTEREST CHARGES
Interest on long-term debt 21
Interest on short-term debt and other 4
-----------
25
-----------
NET INCOME 24
Less: preferred stock dividends --
Gain on reacquisition of preferred stock 1
-----------
NET INCOME FOR COMMON STOCK $25
===========
<PAGE>
WEST TEXAS UTILITIES COMPANY
STATEMENT OF RETAINED EARNINGS
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
RETAINED EARNINGS AT JUNE 30, 1996 $116
Add: Net income (loss) for common stock 25
-----------
141
Deduct: Common stock dividends 17
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $124
===========
<PAGE>
CENTRAL AND SOUTH WEST SERVICES, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
General plant $121 $121
Less - Accumulated depreciation 34 34
--------------------------------
87 87
--------------------------------
CURRENT ASSETS
Accounts receivable affiliated 21 21
Accounts receivable non-affiliated 4 4
Prepayments and other 16 16
--------------------------------
41 41
--------------------------------
DEFERRED CHARGES AND OTHER ASSETS 3 3
--------------------------------
$131 $0 $131
================================
<PAGE>
CENTRAL AND SOUTH WEST SERVICES, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Millions)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Long-term debt $60 $60
--------------------------------
Total capitalization 60 60
--------------------------------
CURRENT LIABILITIES
Accounts payable non-affiliated 11 11
Advances from affiliates and other 37 37
--------------------------------
48 48
--------------------------------
DEFERRED CREDITS 23 23
--------------------------------
$131 $0 $131
================================
<PAGE>
CENTRAL AND SOUTH WEST SERVICES, INC.
STATEMENT OF INCOME
FOR THE TWELVE MONTHS JUNE 30, 1997
UNAUDITED
(Millions)
OPERATING REVENUE $0
-----------
OPERATING EXPENSES AND TAXES
Fuel Expense 3
Other Operating 206
Maintenance 4
Depreciation and amortization 9
Taxes, other than income taxes 7
Income taxes 1
-----------
230
-----------
OPERATING INCOME (230)
-----------
OTHER INCOME AND DEDUCTIONS 236
-----------
INCOME BEFORE INTEREST CHARGES 6
-----------
INTEREST CHARGES 6
-----------
NET INCOME FOR COMMON STOCK $0
===========
<PAGE>
CENTRAL AND SOUTH WEST SERVICES, INC.
STATEMENT OF RETAINED EARNINGS
AS OF JUNE 30, 1997
UNAUDITED
(millions)
RETAINED EARNINGS AT JUNE 30, 1996 $0
Add: Net income (loss) for common stock 0
-----------
RETAINED EARNINGS AT JUNE 30, 1997 $0
===========
<PAGE>
CSW ENERGY, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
Assets
Current Assets
Cash and cash equivalents $ 10 $ 10
Accounts receivable 454 454
Prepaid expenses 59 59
--------------------------------
Total current assets 523 523
Investments In and Advances to Energy Projects 115,641 115,641
Notes Receivable - Affiliate 80,026 80,026
Other Assets
Construction in progress and project
developm costs 157,075 157,075
Other - net 7,913 7,913
--------------------------------
Total other assets 164,988 164,988
================================
Total assets $ 361,178 $ 361,178
================================
Liabilities and Shareholder's Equity
Current Liabilities
Accounts payable $ 12,166 $ 12,166
Accrued liabilities and other 4,836 4,836
--------------------------------
Total current liabilities 17,002 17,002
Long Term Debt 199,824 199,824
Deferred Income Taxes 37,102 37,102
Other 1,721 1,721
--------------------------------
Total liabilities 255,649 255,649
Shareholder's Equity
Common stock 1 1
Additional paid-in-capital 108,139 108,139
Accumulated retained earnings (2,611) (2,611)
--------------------------------
Total shareholder's equity 105,529 105,529
================================
Total liabilities and
shareholder's equity $ 361,178 $ 361,178
================================
<PAGE>
CSW ENERGY, INC.
INCOME STATEMENT
FOR THE TWELVE MONTHS ENDED JUNE 30, 1997
UNAUDITED
(Thousands)
OPERATING REVENUE:
Equity in income from energy
projects $ 18,698
Operation and maintenance services 4,016
Other 450
-----------
Total operating revenue 23,164
OPERATING EXPENSES:
Salaries, wages, and benefits 5,198
Loss on construction contract 7
Operation and maintenance services 2,879
General and administrative 2,867
Nonrecoverable project development
costs -
-----------
Total operating expenses 10,951
-----------
INCOME FROM OPERATIONS 12,213
OTHER INCOME (EXPENSE)
Interest income 4,844
Interest expense (8,730)
Other, net 872
-----------
Total other income (expense) (3,014)
-----------
INCOME (LOSS) BEFORE INCOME TAXES 9,199
PROVISION (BENEFIT) FOR INCOME TAXES 3,575
-----------
Net income $ 5,624
===========
<PAGE>
CSW ENERGY, INC.
STATEMENT OF RETAINED EARNINGS
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Retained Earnings at June 30, 1996 $ (8,235)
Add: Net income for common stock 5,624
-----------
Subtotal (2,611)
Deduct: Common stock dividends -
-----------
Retained Earnings at June 30, 1997 $ (2,611)
===========
<PAGE>
CSW INTERNATIONAL, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
Fixed Assets
Electric distribution plant $ 1,383,867 $ 1,383,867
General plant 309,429 309,429
--------------------------------
Total Electric Plant 1,693,296 1,693,296
Less - Accumulated depreciation 623,808 623,808
--------------------------------
Total Fixed Assets 1,069,488 1,069,488
Current Assets
Cash and cash equivalents 211,827 211,827
Short-term investments 29,786 29,786
Accounts receivable 128,578 128,578
Advances to affiliates 81,304 81,304
Inventories 29,983 29,983
Other current assets 44,843 44,843
--------------------------------
Total Current Assets 526,321 526,321
Other Assets
Goodwill 1,463,120 1,463,120
Prepaid benefit costs 59,904 59,904
Equity investments and other 79,254 79,254
--------------------------------
Total Other Assets 1,602,278 1,602,278
Total Assets $ 3,198,087 $ 3,198,087
================================
CAPITALIZATION AND LIABILITIES
Capitalization
Common stock $ 1 $ 1
Paid-in capital 829,000 829,000
Retained earnings 145,842 145,842
Foreign currency translation
and other 34,965 34,965
--------------------------------
1,009,808 1,009,808
--------------------------------
Long-term debt 1,146,771 1,146,771
Current Liabilities
Accounts payable 253,871 253,871
Advances from affiliates 218,186 218,186
Accrued interest payable 39,838 39,838
Loan notes 67,448 67,448
Accrued taxes payable 49,823 49,823
Customer prepayments 11,552 11,552
Other 22,627 22,627
--------------------------------
663,345 663,345
Deferred Credits
Deferred tax liability 279,796 279,796
Other 98,367 98,367
--------------------------------
Total Deferred Credits 378,163 378,163
--------------------------------
Total Capitalization and
Liabilities $ 3,198,087 $ 3,198,087
================================
<PAGE>
CSW INTERNATIONAL, INC.
INCOME STATEMENT
FOR THE TWELVE MONTHS ENDED JUNE 30, 1997
UNAUDITED
(Thousands)
Operating Revenues
Electric revenues $ 1,629,774
Other diversified 213,696
-----------
1,843,470
-----------
Operating Expenses
Cost of electric sales 1,143,245
General and administrative 230,124
Depreciation and amortization 91,245
Other diversified 151,514
-----------
1,616,128
-----------
Operating Income 227,342
-----------
Other Income and (Deductions)
Investment income 6,605
Interest income 16,626
Interest expense (119,598)
-----------
(96,367)
-----------
Income Before Income Taxes 130,975
-----------
Provision for Income Taxes 28,918
-----------
Net Income $ 102,057
===========
<PAGE>
CSW INTERNATIONAL, INC.
STATEMENT OF RETAINED EARNINGS
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Retained Earnings at June 30, 1996 $ 43,785
Add: Net income for common stock 102,057
-----------
Subtotal 145,842
Deduct: Common stock dividends -
-----------
Retained Earnings at June 30, 1997 $ 145,842
===========
<PAGE>
CSW COMMUNICATIONS, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
Current Assets
Accounts Receivable - Trade $ 720 $ 720
Accounts Receivable - Other 388 388
Income Tax Receivable 1,367 1,367
--------------------------------
Total Receivables 2,475 2,475
Other Current Assets 220 220
--------------------------------
Total Current Assets 2,695 2,695
--------------------------------
Construction In Progress
Construction In Progress - Profit Recognized 354 354
Construction In Progress - Resale Project
Costs 1,116 1,116
Construction In Progress - CSWC Projects 3,781 3,781
--------------------------------
Total Construction In Progress 5,251 5,251
--------------------------------
Property, Plant & Equipment
Plant In Service 14,713 14,713
Accumulated Depreciation (904) (904)
--------------------------------
Plant In Service, net 13,809 13,809
Furniture & Fixtures 234 234
Accumulated Depreciation (85) (85)
--------------------------------
Furniture & Fixtures, net 149 149
Other 5-Year Property 870 870
Accumulated Depreciation (107) (107)
--------------------------------
Other 5-Year Property, net 763 763
--------------------------------
Net Property, Plant & Equipment 14,721 14,721
--------------------------------
Other Assets
Organizational Costs 465 465
Accumulated Amortization (94) (94)
--------------------------------
Organizational Costs, net 371 371
Brooks Fiber Investment, at market 4,091 4,091
Prepaid Pension Asset 40 40
--------------------------------
Total Other Assets 4,502 4,502
--------------------------------
TOTAL ASSETS $ 27,169 $ 27,169
================================
<PAGE>
CSW COMMUNICATIONS, INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
LIABILITIES & EQUITY
Current Liabilities
Accounts Payable - Affiliated $ 287 $ 287
Accounts Payable - Trade 460 460
Advance Billings and Payments 1,439 1,439
Interest Payable - Affiliated 128 128
Accrued Property & Sales Taxes 123 123
Accrued Payroll & Benefits 334 334
--------------------------------
Total Current Liabilities 2,771 2,771
--------------------------------
Long-Term Liabilities
Note Payable - Affiliated 28,696 28,696
--------------------------------
Total Long-Term Liabilities 28,696 28,696
--------------------------------
Deferred Credits - -
Deferred Income Taxes 1,298 1,298
Equity
Common Stock 1 1
Additional Paid-in Capital - -
Retained Earnings (8,688) (8,688)
Unrealized Gain on Investments 3,091 3,091
--------------------------------
Total Equity (5,596) (5,596)
--------------------------------
TOTAL LIABILITIES & EQUITY $ 27,169 $ 27,169
================================
<PAGE>
CSW COMMUNICATIONS, INC.
INCOME STATEMENT
FOR THE TWELVE MONTHS ENDED JUNE 30, 1997
UNAUDITED
(Thousands)
REVENUES
Construction $ 976
Leased Lines (Fiber Optics) 848
Miscellaneous 24
-----------
Total Revenue 1,848
COST OF GOODS SOLD
Cost of Construction 622
-----------
NET REVENUE / (LOSS) 1,226
-----------
EXPENSES
General & Administrative 7,463
Depreciation and Amortization 1,134
Interest 1,406
-----------
Total Expenses 10,003
-----------
TAXES
Federal Income Tax - Current (3,853)
Federal Income Tax - Deferred 636
Taxes Other than Income 424
-----------
Total Taxes (2,793)
-----------
NET INCOME / (LOSS) $ (5,984)
===========
<PAGE>
CSW COMMUNICATIONS, INC.
STATEMENT OF RETAINED EARNINGS
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
BALANCE JUNE 30, 1996 $ (2,704)
Net income / (loss) (5,984)
-----------
BALANCE DECEMBER 31, 1996 $ (8,688)
===========
<PAGE>
ENERSHOP INC.
BALANCE SHEETS
PER BOOKS AND PRO FORMA
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
Per Pro Forma Pro
Books Adjustments Forma
--------------------------------
ASSETS
CurrentAssets
Accounts Receivable $ 670 $ 670
Prepaid Assets 21 21
Federal Income Tax Benefit 466 466
Work in Progress 65 65
Other Assets 13 13
--------------------------------
Total Current Assets 1,235 1,235
--------------------------------
Office Furniture & Equipment 115 115
Accumulated Depreciation (20) (20)
--------------------------------
Net Plant 95 95
--------------------------------
Other Assets
Prepaid Benefit Plans 32 32
--------------------------------
Total Assets $ 1,362 $ 1,362
================================
LIABILITIES & EQUITY
Current Liabilities
Accounts Payable $ 300 $ 300
Accounts Payable - affiliated 25 25
--------------------------------
Total Current Liabilities 325 325
--------------------------------
Long Term Liabilities
Notes Payable 3,647 3,647
--------------------------------
Total Liabilites 3,972 3,972
--------------------------------
EQUITY
Equity
Common Stock -- --
Addtional Paid in Capital 1 1
Retained Earnings (2,611) (2,611)
--------------------------------
Total Equity (2,610) (2,610)
--------------------------------
Total Liabilities & Equity $ 1,362 $ 1,362
================================
<PAGE>
ENERSHOP INC.
INCOME STATEMENT
FOR THE TWELVE MONTHS ENDED JUNE 30, 1997
UNAUDITED
(Thousands)
Contract Revenue $ 1,578
Maintenance Revenue 8
Other Misc Revenue 9
-----------
Total Revenue 1,595
Cost of Revenue 1,222
-----------
Operating Income 373
Gross Profit Margin 23.37%
Selling & Admin Expenses
Salaries & Employee Benefits 1,291
Marketing - General 300
Outside Services - Affiliate 239
Consulting & legal Fees 607
Travel and Entertainment 161
Administrative and General 402
Depreciation 22
-----------
Total Expenses 3,022
Other Deductions
Interest Expense 132
Federal Income Taxes (1,033)
-----------
Net Income (loss) $ (1,748)
===========
<PAGE>
ENERSHOP INC.
STATEMENT OF RETAINED EARNINGS
AS OF JUNE 30, 1997
UNAUDITED
(Thousands)
BALANCE JUNE 30, 1996 $ (863)
Net Income (loss) (1,748)
-----------
BALANCE JUNE 30, 1997 $ (2,611)
===========
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
PRO FORMA ADJUSTMENTS TO BALANCE SHEETS
JUNE 30, 1997
UNAUDITED
(Millions)
DR CR
---------------------
Note: None of the applicants have pro forma adjustments related to this request.
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
STATEMENT OF CHANGES
There have been no significant changes in the financial statements of
Central and South West Corporation and subsidiary companies subsequent to
June 30, 1997, other than in the ordinary course of business.
<PAGE>
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The notes to consolidated financial statements included in Central and
South West Corporation's 1996 Combined Annual Report on Form 10-K are hereby
incorporated by reference and made a part of this report.
Page
Reference
1996 Combined Annual Report on Form 10-K pages 2-39 through 2-71
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<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (184,182)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR1
<SUBSIDIARY>
<NUMBER> 033
<NAME> CSW INTERNATIONAL, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> Jun-30-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,069,488
<OTHER-PROPERTY-AND-INVEST> 79,254
<TOTAL-CURRENT-ASSETS> 526,321
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 1,523,024
<TOTAL-ASSETS> 3,198,087
<COMMON> 1
<CAPITAL-SURPLUS-PAID-IN> 829,000
<RETAINED-EARNINGS> 180,807
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,009,808
0
0
<LONG-TERM-DEBT-NET> 1,146,771
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,041,508
<TOT-CAPITALIZATION-AND-LIAB> 3,198,087
<GROSS-OPERATING-REVENUE> 1,843,470
<INCOME-TAX-EXPENSE> 28,918
<OTHER-OPERATING-EXPENSES> 1,616,128
<TOTAL-OPERATING-EXPENSES> 1,645,046
<OPERATING-INCOME-LOSS> 198,424
<OTHER-INCOME-NET> 23,231
<INCOME-BEFORE-INTEREST-EXPEN> 221,655
<TOTAL-INTEREST-EXPENSE> 119,598
<NET-INCOME> 102,057
0
<EARNINGS-AVAILABLE-FOR-COMM> 102,057
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 25,888
<CASH-FLOW-OPERATIONS> 323,784
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR1
<SUBSIDIARY>
<NUMBER> 010
<NAME> CSW COMMUNICATIONS, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> Jun-30-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 19,972
<TOTAL-CURRENT-ASSETS> 2,695
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 4,502
<TOTAL-ASSETS> 27,169
<COMMON> 1
<CAPITAL-SURPLUS-PAID-IN> 0
<RETAINED-EARNINGS> (5,597)
<TOTAL-COMMON-STOCKHOLDERS-EQ> (5,596)
0
0
<LONG-TERM-DEBT-NET> 28,696
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 4,069
<TOT-CAPITALIZATION-AND-LIAB> 27,169
<GROSS-OPERATING-REVENUE> 1,848
<INCOME-TAX-EXPENSE> (3,217)
<OTHER-OPERATING-EXPENSES> 9,643
<TOTAL-OPERATING-EXPENSES> 6,426
<OPERATING-INCOME-LOSS> (4,578)
<OTHER-INCOME-NET> 0
<INCOME-BEFORE-INTEREST-EXPEN> (4,578)
<TOTAL-INTEREST-EXPENSE> 1,406
<NET-INCOME> (5,984)
0
<EARNINGS-AVAILABLE-FOR-COMM> (5,984)
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (5,888)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR1
<SUBSIDIARY>
<NUMBER> 026
<NAME> ENERSHOP INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> Jun-30-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 95
<TOTAL-CURRENT-ASSETS> 1,235
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 32
<TOTAL-ASSETS> 1,362
<COMMON> 0
<CAPITAL-SURPLUS-PAID-IN> 1
<RETAINED-EARNINGS> (2,611)
<TOTAL-COMMON-STOCKHOLDERS-EQ> (2,610)
0
0
<LONG-TERM-DEBT-NET> 3,647
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 325
<TOT-CAPITALIZATION-AND-LIAB> 1,362
<GROSS-OPERATING-REVENUE> 1,595
<INCOME-TAX-EXPENSE> (1,033)
<OTHER-OPERATING-EXPENSES> 4,244
<TOTAL-OPERATING-EXPENSES> 3,211
<OPERATING-INCOME-LOSS> (1,616)
<OTHER-INCOME-NET> 0
<INCOME-BEFORE-INTEREST-EXPEN> (1,616)
<TOTAL-INTEREST-EXPENSE> 132
<NET-INCOME> (1,748)
0
<EARNINGS-AVAILABLE-FOR-COMM> (1,748)
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (1,373)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
EXHIBIT 3
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- )
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
_____________ ___, 1997
Notice is hereby given that the following filing(s) has/have been
made with the Commission pursuant to provisions of the Act and rules promulgated
thereunder. All interested persons are referred to the application(s) and/or
declaration(s) for complete statements of the proposed transaction(s) summarized
below. The application(s) and/or declaration(s) and any amendment(s) thereto
is/are available for public inspection through the Commission's Office of Public
Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in writing by
______________, 1997, to the Secretary, Securities and Exchange Commission,
Washington, D.C. 20549, and serve a copy on the relevant applicant(s) and/or
declarant(s) at the address(es) specified below. Proof of service (by affidavit,
or, in case of an attorney at law, by certificate) should be filed with the
request. Any request for hearing shall identify specifically the issues of fact
or law that are disputed. A person who so requests will be notified of any
hearing, if ordered, and will receive a copy of any notice or order issued in
the matter. After said date, the application(s) and/or declaration(s), as filed
or as amended, may be granted and/or permitted to become effective.
<PAGE>
Central and South West Corporation, et al. (70-8557)
Central and South West Corporation ("CSW"), a registered holding
company, and Central and South West Services, Inc. ("Services"), Central Power
and Light Company ("CPL"), Public Service Company of Oklahoma ("PSO"),
Southwestern Electric Power Company ("SWEPCO"), West Texas Utilities Company
("WTU"), CSW Energy, Inc. ("Energy"), CSW International, Inc. ("CSWI"), CSW
Communications, Inc. ("Communications"), CSW Energy Services, Inc. ("ESI") and
EnerShop, Inc. ("EnerShop") (collectively, the "Subsidiaries") have filed an
application-declaration under Sections 6(a), 7, 9(a), 10 and 12(b) of the Act
and Rules 43 and 45 thereunder.
CSW and the Subsidiaries propose to expand the System Money Pool,
as previously authorized by orders in HCAR Nos. 25777 (March 31, 1993), 25897
(September 28, 1993), 26007 (March 18, 1994), 26066 (June 15, 1994), 26226
(February 1, 1995), 26254 (March 21, 1995) and 26697 (March 28, 1997), by
increasing the borrowing limits of the existing participants and by permitting
the New Participants to make loans to, and borrow from, the System Money Pool,
or, should CSW deem it appropriate, to form a separate money pool for the New
Participants.
CSW requests authority: (i) to increase the aggregate amount of
authorized borrowings (a) by CSW from $1.2 billion to $2.5 billion, (b) by CPL
from $300 million to $400 million, (c) by PSO from $125 million to $225 million,
(d) by SWEPCO from $150 million to $250 million, (e) by WTU from $65 million to
$165 million, and (f) by CSWS from $110 million to $210 million; and (ii) either
(a) for Energy, CSWI, Communications, EnerShop, ESI and any other existing or
future CSW first tier subsidiary or Rule 58 company that CSW may wish to include
(collectively, the "New Participants") to participate in the system of
intercorporate borrowings under the CSW system money pool or (b) for CSW and the
New Participants to, currently or in the future, form and participate in a
separate system of intercorporate borrowings should CSW deem proper the
formation of a separate money pool based on then existing regulatory or business
considerations.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Jonathan G. Katz
Secretary
