<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 10, 1996
REGISTRATION NO. 333-02895
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
(Exact name of Registrant as specified in its charter)
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<TABLE>
<S> <C>
LOUISIANA 72-0244480
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
</TABLE>
2030 DONAHUE FERRY ROAD
PINEVILLE, LOUISIANA 71360-5226
(318) 484-7400
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
---------------------
MICHAEL P. PRUDHOMME
SECRETARY-TREASURER
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
2030 DONAHUE FERRY ROAD
PINEVILLE, LOUISIANA 71360-5226
(318) 484-7400
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: At such
time or times after the effective date of this Registration Statement as the
registrant shall determine.
If the only securities being registered with this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
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<PAGE> 2
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* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A *
* REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT *
* BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
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Subject To Completion
Preliminary Prospectus Dated December , 1996
PROSPECTUS [CLECO LOGO]
$200,000,000
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
MEDIUM-TERM NOTES
DUE MORE THAN ONE YEAR FROM DATE OF ISSUE
Central Louisiana Electric Company, Inc. (the "Company") may offer from time to
time a maximum of $200,000,000 aggregate principal amount of medium-term notes
on terms to be determined at the time or times of sale. For each offering of
medium-term notes for which this Prospectus is being delivered (the "Medium-Term
Notes") there will be a pricing supplement (each a "Pricing Supplement") that
will set forth the specific designation, aggregate principal amount, maturity or
maturities, rate or rates and times of payment of interest, if any, any
redemption terms or repayment provisions and any other special terms of the
Medium-Term Notes. Each Medium-Term Note will bear interest at a fixed or
variable rate or will be in zero-coupon form, in each case as specified in a
Pricing Supplement to be delivered with this Prospectus to the purchaser of any
such Medium-Term Note. The interest payment dates for each interest-bearing
Medium-Term Note will be March 15 and September 15 of each year. Each
Medium-Term Note will mature more than one year from its date of issue (the
"Stated Maturity"), as set forth in the applicable Pricing Supplement. Each
issuance of the Medium-Term Notes may be subject to redemption prior to maturity
at the option of the Company or any holder thereof, in each case, in whole or in
part, prior to the Stated Maturity, as set forth and specified in the applicable
Pricing Supplement. See "Description of the Medium-Term Notes" for a more
complete description of the terms and provisions of the Medium-Term Notes.
Each Medium-Term Note will be issued in fully registered form and will be
represented by a global certificate (a "Book-Entry Note") registered in the name
of a nominee of The Depository Trust Company or other depositary (the
"Depositary"). Beneficial interests in Medium-Term Notes represented by a global
security will be shown on, and transfers thereof will be effected only through,
records maintained by the Depositary (with respect to participants' interests)
and its participants. See "Description of the Medium-Term Notes -- Book-Entry
Notes."
The Medium-Term Notes will be issued in minimum denominations of $1,000 or in
any amount in excess thereof that is an integral multiple of $1,000.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF THE MEDIUM-TERM NOTES
UNLESS ACCOMPANIED BY A PRICING SUPPLEMENT.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
PRICE TO AGENTS' PROCEEDS TO
PUBLIC (1) COMMISSION(2)(3) COMPANY(2)(3)(4)
<S> <C> <C> <C>
Per Medium-Term Note......................... 100.000% .125%-.750% 99.875%-99.250%
Total........................................ $200,000,000 $250,000-$1,500,000 $199,750,000-$198,500,000
</TABLE>
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(1) Unless otherwise specified in a Pricing Supplement, Medium-Term Notes will
be issued at 100% of their principal amount.
(2) The Company has agreed to indemnify the Agents against certain liabilities,
including liabilities under the Securities Act of 1933.
(3) In the case of Medium-Term Notes sold directly by the Company to investors
or other purchasers (other than agents), no discount will be allowed or
commission paid. In the case of any Medium-Term Notes with a maturity in
excess of 30 years, the commission will be agreed upon between the Company
and the Agents at the time of sale and may exceed .750% per Medium-Term
Note.
(4) Before deducting expenses payable by the Company estimated at $315,966.
The Medium-Term Notes are being offered on a continuous basis by the Company
through Salomon Brothers Inc, Merrill Lynch & Co., Smith Barney Inc. and First
Chicago Capital Markets, Inc. (collectively, the "Agents"), each of whom has
agreed to use its reasonable efforts to solicit offers to purchase the
Medium-Term Notes. The Medium-Term Notes may be sold to any Agent, as principal,
at a discount for resale to investors or other purchasers at varying prices
related to prevailing market prices at the time of resale, to be determined by
such Agent or, if agreed, at a fixed public offering price. The Company also may
sell the Medium-Term Notes directly to investors or other purchasers on its own
behalf. The Notes will not be listed on any securities exchange, and there can
be no assurance that the Medium-Term Notes offered by this Prospectus will be
sold or that there will be a secondary market for any of the Medium-Term Notes.
The Company reserves the right to withdraw, cancel or modify the offer or
solicitation of offers made hereby without notice. An offer may be rejected in
whole or in part by the Company or by the Agent, if any, that solicited such
offer. See "Plan of Distribution."
SALOMON BROTHERS INC
FIRST CHICAGO CAPITAL MARKETS, INC.
MERRILL LYNCH & CO.
SMITH BARNEY INC.
The date of this Prospectus is December , 1996.
<PAGE> 3
IN CONNECTION WITH ANY OFFERING OF MEDIUM-TERM NOTES, ANY UNDERWRITER MAY, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, OVER-ALLOT OR EFFECT TRANSACTIONS THAT
STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT A
LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549 and at the Commission's regional offices
located at Seven World Trade Center, New York, New York 10048, and at the
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of such material can also be obtained at prescribed
rates from the Public Reference Section of the Commission at its principal
office at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549. The
Company's common stock, par value $2.00 per share (the "Common Stock"), is
listed for trading on the New York Stock Exchange (the "NYSE") and the Pacific
Stock Exchange (the "PSE"), and such reports, proxy statements and other
information should be available for inspection at the offices of the NYSE, 20
Broad Street, New York, New York 10005 and the offices of the PSE, 301 Pine
Street, San Francisco, California 94104.
This Prospectus constitutes a part of a registration statement on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statement"), filed by the Company with the Commission under the Securities Act
of 1933, as amended (the "Securities Act"), with respect to the Medium-Term
Notes offered hereby. As permitted by the rules and regulations of the
Commission, this Prospectus omits certain information contained in the
Registration Statement, and reference is made to the Registration Statement for
further information with respect to the Company and the Medium-Term Notes
offered hereby. Any statements contained herein concerning the provisions of any
document filed as an exhibit to the Registration Statement or otherwise filed
with the Commission are not necessarily complete, and in each instance reference
is made to the copy of such document so filed. Each such statement is qualified
in its entirety by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Annual Report of the Company on Form 10-K for the year ended December
31, 1995 and the Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 1996, June 30, 1996 and September 30, 1996 have been filed with the
Commission by the Company pursuant to the Exchange Act (File No. 1-5663) and are
incorporated herein by reference. All documents filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of this Prospectus and prior to the termination of the
offering made by this Prospectus shall be deemed to be incorporated herein by
reference and to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document that also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
2
<PAGE> 4
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus is delivered, upon the written or oral request of
any such person, a copy of any and all of the documents (without exhibits other
than exhibits specifically incorporated by reference into such documents)
referred to above that have been incorporated by reference in this Prospectus.
Written or oral requests for such copies should be directed to Central Louisiana
Electric Company, Inc., 2030 Donahue Ferry Road, Pineville, Louisiana 71360-5226
(P.O. Box 5000, Pineville, Louisiana 71361-5000), Attention: Treasurer
(telephone: (318) 484-7400).
THE COMPANY
The Company is engaged in the business of generating, transmitting,
distributing and selling electric energy to approximately 221,000 customers in
63 communities and contiguous rural areas in the State of Louisiana. The Company
was incorporated under the laws of the State of Louisiana in 1934. The address
of the principal executive offices of the Company is 2030 Donahue Ferry Road,
Pineville, Louisiana 71360-5226 (P.O. Box 5000, Pineville, Louisiana
71361-5000), and its telephone number at such address is (318) 484-7400.
It is expected that the Company's external cash requirements for the
five-year period 1996 through 2000 will be met through the sale of debt
securities. See "Use of Proceeds" below. Short-term requirements pending
permanent financing will be met through the sale of commercial paper and
borrowings under short-term debt arrangements.
The amount of internally generated funds and the Company's ability to
finance future construction and other capital requirements externally through
the sale of securities will be largely dependent on the level of the Company's
sales of electricity, and its electric rates and on the availability and cost of
external financing.
3
<PAGE> 5
SELECTED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT RATIOS, PERCENTAGES AND PER SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1993 1994 1995
-------- -------- --------
<S> <C> <C> <C>
Statement of Income Data:
Operating revenues.................................... $382,433 $379,603 $394,426
Operating income...................................... $ 64,745 $ 70,430 $ 74,702
Income before interest charges........................ $ 67,571 $ 71,417 $ 76,907
Net income............................................ $ 41,812 $ 45,043 $ 48,703
Primary earnings per share............................ $ 1.78 $ 1.92 $ 2.08
Fully diluted earnings per share...................... $ 1.73 $ 1.86 $ 2.01
</TABLE>
<TABLE>
<CAPTION>
TWELVE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
1991 1992 1993 1994 1995 1996
------ ------ ------ ------ ------ -------------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed
Charges:.......................... 2.99x 3.16x 3.30x 3.35x 3.49x 3.61x
</TABLE>
<TABLE>
<CAPTION>
SEPTEMBER 30, 1996
------------------
<S> <C> <C>
Capital Structure:
First mortgage bonds(1)............................................... $ 85,000 11.0%
Medium-term notes..................................................... 215,000 27.8%
Other long-term debt(2)............................................... 60,850 7.9%
Cumulative preferred stock(3)......................................... 15,817 2.1%
Common shareholders' equity........................................... 395,687 51.2%
-------- -----
Total capitalization.......................................... $772,354 100.0%
======== =====
Short-term debt....................................................... $ 31,497
</TABLE>
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(1) Includes $25 million in first mortgage bonds which have been called for
redemption on December 27, 1996.
(2) Includes approximately $61.3 million aggregate principal amount of
continuously remarketed variable rate pollution control revenue bonds due
2018, net of unamortized premium and discount on long-term debt of
approximately $410,000.
(3) Includes $29.5 million of convertible preferred stock issued in April 1991
in connection with the establishment of an employee stock ownership plan,
reduced by approximately $21.0 million of unearned compensation related to
such employee stock ownership plan.
4
<PAGE> 6
USE OF PROCEEDS
Unless otherwise indicated in the applicable Pricing Supplement, the net
proceeds to be received by the Company from the sale of the Medium-Term Notes
may be used to repurchase or redeem equity and higher cost debt securities, to
reduce short-term debt, to finance the construction or acquisition of plant and
related facilities necessary for the Company to meet the requirements of its
customers, and for the Company's other general corporate purposes. Pending
application to one or more of the foregoing uses, the net proceeds will be
invested in short-term financial instruments.
DESCRIPTION OF THE MEDIUM-TERM NOTES
The Medium-Term Notes will be issued under an Indenture (the "Note
Indenture") dated as of October 1, 1988 between the Company and Bankers Trust
Company under which The Bank of New York is the current trustee (the "Note
Trustee"). A copy of the Note Indenture and the Agreement of Resignation,
Appointment and Acceptance whereby The Bank of New York succeeded Bankers Trust
Company as trustee are included among the exhibits to the Registration Statement
of which this Prospectus is a part. The Note Indenture provides that unsecured
debentures, notes or other evidences of indebtedness ("Securities") may be
issued thereunder, without limitation as to aggregate principal amount, by the
Company in one or more series and with such terms as established by the Company
pursuant to the terms of the Note Indenture. All medium-term notes issued or to
be issued by the Company under the Note Indenture are referred to herein as
"Notes." The Medium-Term Notes are a series of Securities under the Note
Indenture and may be issued in one or more offerings. As of the date of this
Prospectus, the Company had issued and outstanding Notes in an aggregate
principal amount of $215 million. The following summaries of certain provisions
of the Note Indenture do not purport to be complete and are subject to, and
qualified in their entirety by, all of the provisions of the Note Indenture,
including the definitions therein of certain terms.
Except as may otherwise be provided in any applicable Pricing Supplement,
each Medium-Term Note will have the following terms and provisions.
General. The Note Indenture provides that the Notes may be issued at
various times, may have differing maturity dates and may bear interest at
differing rates or be issued in zero-coupon form. Except as may otherwise be
provided in any applicable Prospectus Supplement, the Medium-Term Notes will be
issued at a purchase price equal to 100% of the principal amount thereof. Unless
otherwise specified in the applicable Pricing Supplement and except as otherwise
specified in "Book-Entry Notes" below, the Medium-Term Notes will be denominated
in U.S. dollars in minimum denominations of $1,000 or in any amount in excess
thereof that is an integral multiple of $1,000. The interest payment dates for
each interest-bearing Medium-Term Note will be March 15 and September 15 of each
year (each an "Interest Payment Date"). See "Interest Rates and Payments" below.
Each Medium-Term Note will mature more than one year from its date of issue (the
"Stated Maturity"), as set forth in the applicable Pricing Supplement. As
discussed below in "Redemption at the Option of the Company" and "Repayment at
the Option of the Holder," the Medium-Term Notes may be subject to redemption
prior to the Stated Maturity at the option of the Company or any Holder (as
defined in the Note Indenture) thereof, as provided in the applicable Pricing
Supplement. If the applicable Pricing Supplement so provides, the terms of a
Medium-Term Note subject to redemption at the option of the Company may specify
that the Company may not redeem the Medium-Term Note prior to a specified date
as a part of, or in anticipation of, a refunding operation by the application of
monies borrowed having an interest cost to the Company (calculated in accordance
with generally accepted financial practice) of less than a specified rate. The
Medium-Term Notes will not be subject to amortization or a sinking fund.
Reference is made to the applicable Pricing Supplement with respect to each
Medium-Term Note for the interest rate (if any) thereon, the Stated Maturity
date thereof and for other important information set forth therein with respect
to such Medium-Term Note.
5
<PAGE> 7
The Company has the sole right to accept any offers to purchase Medium-Term
Notes and may reject any proposed purchase of Medium-Term Notes in whole or in
part.
The Company has designated The Bank of New York ("BONY") as paying agent
and registrar of the Medium-Term Notes. The Company has also designated BONY as
its agent in the Borough of Manhattan, The City of New York, where Medium-Term
Notes may be presented for payment and may be transferred or exchanged. BONY
maintains in the Borough of Manhattan, The City of New York, an office where
such transactions may occur.
No service charge will be made to register any transfer or exchange of the
Medium-Term Notes, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
The Note Indenture does not contain any covenants or other provisions that
are specifically intended to afford Holders of the Medium-Term Notes special
protection in the event of a highly leveraged transaction by the Company.
Redemption at the Option of the Company. The Medium-Term Notes will not be
subject to amortization or any sinking fund. An issuance of Medium-Term Notes
will be redeemable at the option of the Company prior to their Stated Maturity
only if an initial redemption date is specified therein (the "Initial Redemption
Date") and in the applicable Pricing Supplement. If so indicated in the
applicable Pricing Supplement, the Notes will be subject to redemption at the
option of the Company on any date on and after the applicable Initial Redemption
Date specified in such Pricing Supplement. On and after the Initial Redemption
Date, if any, the related Medium-Term Note may be redeemed at any time in whole
or from time to time in part in increments of $1,000 (or such other amount as
may be specified in the applicable Pricing Supplement) at the option of the
Company at the applicable Redemption Price, together with interest thereon
payable to the date of redemption, on notice given to the Holder (which, in the
case of Book-Entry Notes, will be the Depositary or its nominee) not more than
60 nor less than 30 days prior to the date of redemption and in accordance with
the provisions of the Indenture. "Redemption Price," with respect to a
Medium-Term Note, will initially mean a percentage (the "Initial Redemption
Percentage") of the principal amount of such Note to be redeemed specified in
the applicable Pricing Supplement and shall decline at each anniversary of the
Initial Redemption Date by a percentage (the "Annual Redemption Percentage
Reduction"), if any, specified in the applicable Pricing Supplement, of the
principal amount to be redeemed until the Redemption Price is 100% of such
principal amount. If an Initial Redemption Percentage is specified in the
applicable Pricing Supplement but no Annual Redemption Percentage Reduction is
set forth therein, the "Redemption Price" shall be the Initial Redemption
Percentage of the principal amount of such Medium-Term Note to be redeemed. In
the event of redemption of a Medium-Term Note in part, a new Medium-Term Note or
Notes will be issued to the Holder in the exchange for the unredeemed portion.
Repayment at the Option of the Holder. If so indicated in an applicable
Pricing Supplement, an issuance of Medium-Term Notes will be repayable by the
Company in whole or in part at the option of a Holder thereof on their
respective optional repayment dates specified in such Pricing Supplement (the
"Optional Repayment Dates"). If no Optional Repayment Date is indicated in a
Pricing Supplement with respect to a Medium-Term Note, such Medium-Term Note
will not be repayable at the option of the Holder prior to its Stated Maturity.
Unless otherwise specified in the applicable Pricing Supplement, the repayment
option may be exercised by the Holder for less than the entire principal amount
of the Medium-Term Note. Any repayment in part will be in increments of $1,000
(or such other amount as may be specified in the applicable Pricing Supplement)
provided that any remaining principal amount of such Medium-Term Note will be an
authorized denomination of such Medium-Term Note. Unless otherwise provided in
an applicable Pricing Supplement, the repayment price payable to the Holder will
be 100% of the principal amount to be repaid, together with accrued interest
thereon payable to the date of repayment. In the event of a repayment in part, a
new
6
<PAGE> 8
Medium-Term Note or Notes will be issued to the Holder in exchange for the
unrepaid portion. Exercise of such repayment option by the Holder will be
irrevocable.
While Book-Entry Notes are represented by global securities held by or on
behalf of the Depositary, and registered in the name of the Depositary or the
Depositary's nominee, the option for repayment may be exercised by the
Depositary, the Depositary's nominee or the applicable participant (as defined
below in "Book-Entry Notes") on behalf of the beneficial owner of such
Book-Entry Notes by delivering a written notice, in a form acceptable to the
Trustee, to the Trustee at the Corporate Trust Office (or such other address of
which the Company shall from time to time notify the Holders), not more than 60
nor less than 30 days prior to the Optional Repayment Date. Notices of elections
from participants on behalf of beneficial owners of the Book-Entry Notes to
exercise their option to have the Book-Entry Notes repaid must be received by
the Trustee by 5:00 p.m., New York City time, on the last day for giving such
notice. In order to ensure that a notice is received by the Trustee on a
particular day, the beneficial owner of Book-Entry Notes must so direct the
applicable participant through which it holds an interest in such Book-Entry
Note before such participant's deadline for accepting instructions for that day.
Different firms may have different deadlines for accepting instructions from
their customers. Accordingly, beneficial owners of Book-Entry Notes should
consult the participants through which they own their interest in the Book-Entry
Notes for the respective deadlines for such participants. All notices shall be
executed by a duly authorized officer of such participant (with signature
guaranteed) and shall be irrevocable. In addition, such beneficial owners of
Book-Entry Notes shall effect delivery of such Book-Entry Notes at the time such
notices of election are given to the Trustee by causing the participant to
transfer such beneficial owner's interest in the Book-Entry Notes, on the
Depositary's records, to the Trustee. Conveyance of notices and other
communications by the Depositary to participants, by participants to indirect
participants and by participants and indirect participants to beneficial owners
of the Book-Entry Notes will be governed by agreements among them, subject to
any statutory or regulatory requirements as may be in effect from time to time.
If applicable, the Company will comply with the requirements of Rule 14e-1
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
any other securities laws or regulations in connection with any such repayment.
The Company may at any time purchase Medium-Term Notes at any price or
prices in the open market or otherwise. Medium-Term Notes so purchased by the
Company may be held or resold or, at the discretion of the Company, may be
surrendered to the Trustee for cancellation.
Interest Rates and Payments. Each interest-bearing Medium-Term Note will
bear interest from its original issue date at a fixed or variable rate as
indicated in the applicable Pricing Supplement. The interest rate on any Note
may not exceed nine (9%) percent per year, unless the Company applies for and
receives an order of the Louisiana Public Service Commission ("LPSC") allowing a
higher rate to be paid. Except as provided below with respect to certain first
interest payments, interest will be payable semiannually on each Interest
Payment Date and at maturity. Interest will be computed on the basis of a
360-day year of twelve 30-day months. Unless otherwise provided in the
applicable Pricing Supplement, interest will be payable generally to the person
in whose name such Medium-Term Note is registered at the close of business on
the regular record date (the March 1 or September 1 next preceding each Interest
Payment Date), but interest payable at maturity (whether at stated maturity or
earlier redemption) will be payable in immediately available funds to the person
to whom principal is payable. The first payment of interest on any Medium-Term
Note originally issued between a regular record date and an Interest Payment
Date will be made on the Interest Payment Date following the next succeeding
regular record date to the registered owner on such next regular record date.
Principal and interest at maturity will be payable in immediately available
funds, and Medium-Term Notes will be transferable, at the office of BONY, 101
Barclay Street, New York, New York 10286.
7
<PAGE> 9
If an Interest Payment Date or the maturity date falls on a day that is not
a Business Day, principal or interest payable with respect to such Interest
Payment Date or maturity date will be paid on the next succeeding Business Day,
and no interest will accrue with respect to such payment for the period after
such Interest Payment Date or maturity date.
Ranking; Limitation on Liens. The Medium-Term Notes will be unsecured and
will rank pari passu with all other unsecured and unsubordinated indebtedness of
the Company. As of the date hereof, the Company has issued and outstanding $85
million aggregate principal amount of its first mortgage bonds (the "Bonds")
issued under and secured by an Indenture of Mortgage, dated as of July 1, 1950
(the "Original Bond Indenture"), as previously supplemented and amended by
supplemental indentures (the Original Bond Indenture as so supplemented and
amended being herein called the "Bond Indenture"), between the Company and First
National Bank of Commerce (formerly The National Bank of Commerce in New
Orleans), as trustee (the "Bond Trustee"). Holders of the Bonds would have a
prior claim on certain material assets of the Company upon any dissolution,
winding up, liquidation or reorganization of the Company.
The Company will not issue, assume or guarantee any debt for money borrowed
("Debt") if such Debt is secured by any mortgage, security interest, pledge,
lien or other encumbrance (a "mortgage") upon any property of the Company or any
subsidiary or indebtedness issued by any subsidiary and owned by the Company or
any other subsidiary, and the Company will not permit any subsidiary to issue,
assume or guarantee any Debt secured by any mortgage upon any property of the
Company or indebtedness issued by any subsidiary and owned by the Company,
whether any such property or indebtedness is owned at the date of the Note
Indenture or thereafter acquired, without effectively securing the Notes equally
and ratably with (or prior to) such Debt. The foregoing restriction will not
apply to mortgages on any property of any subsidiary except for property of such
subsidiary that is used to secure Debt of the Company. The foregoing restriction
also will not apply to (1) mortgages to secure Debt issued under the Company's
Bond Indenture; (2) "permitted liens" as defined in the most recent supplement
to the Bond Indenture; (3) mortgages on any property acquired, constructed or
improved after the date of the Note Indenture which are created or assumed
within 120 days after such acquisition or completion of such construction or
improvement (or within six months thereafter pursuant to a firm commitment for
financing arrangements entered into within such 120-day period) to secure or
provide for the payment of the purchase price or cost of such construction or
improvement incurred after the date of the Note Indenture, or existing mortgages
on property acquired, provided such mortgages will not apply to any property
theretofore owned by the Company or a subsidiary other than theretofore
unimproved real property; (4) existing mortgages of a corporation merged with or
into the Company or a subsidiary; (5) mortgages of any corporation existing at
the time it becomes a subsidiary; (6) mortgages securing Debt owed by a
subsidiary to the Company or to another subsidiary; (7) mortgages in favor of
governmental bodies to secure advances or other payments pursuant to any
contract or statute or to secure indebtedness incurred to finance the purchase
price or cost of constructing or improving the property subject to such
mortgages, including mortgages to secure Debt of the pollution control or
industrial revenue bond type; (8) mortgages to secure loans to the Company or
any subsidiary maturing within 12 months and made in the ordinary course of
business; (9) mortgages existing on the date of the Note Indenture; (10)
mortgages on any property (including any natural gas, oil or other mineral
property) to secure all or part of the cost of exploration, drilling or
development thereof or to secure Debt incurred to provide funds for any such
purpose; (11) certain mortgages typically incurred in the ordinary course of
business; or (12) mortgages for extending, renewing or replacing Debt secured by
any mortgage referred to in the foregoing clauses (1) to (11) inclusive or in
this clause (12), provided that the principal amount of Debt secured thereby may
not exceed the principal amount of Debt so secured at the time of such
extension, renewal or replacement, plus the amount of any redemption or
repurchase premiums incurred in retiring such Debt, and that the mortgage for
such extension, renewal or replacement must be limited to the original property
or indebtedness. Furthermore, such restriction will not apply to the issuance,
assumption or guarantee by the Company or any subsidiary of Debt secured by a
8
<PAGE> 10
mortgage which would otherwise be subject to the foregoing restriction up to an
aggregate amount which, together with all other secured Debt (not including
secured Debt permitted under the foregoing exceptions), does not exceed five
percent of Consolidated Net Tangible Assets. "Consolidated Net Tangible Assets"
is defined as the total amount of assets appearing on the consolidated balance
sheet of the Company and its subsidiaries less the following: (a) reserves for
depreciation and other asset valuation reserves but excluding reserves for
deferred federal income taxes; (b) intangible assets such as goodwill,
trademarks, trade names, patents and unamortized debt discount and expense; and
(c) appropriate adjustments on account of minority interests of other persons
holding voting stock in any subsidiary of the Company.
Events of Default. The following constitute events of default under the
Note Indenture: (1) default in the payment of principal of (and premium, if any,
on) any Note when due and the continuation thereof for a period of three
business days; (2) default in the payment of interest on any Note when due and
the continuation thereof for a period of 30 days; (3) default in the performance
or breach of any other covenant or warranty of the Company in the Note Indenture
(other than a covenant or warranty included in the Note Indenture solely for the
benefit of one or more series of Securities other than the Notes), and the
continuation thereof for 60 days after written notice to the Company as provided
in the Note Indenture; (4) default in the payment of principal of or interest
on, or acceleration of, securities of any other series issued under the Note
Indenture or any other mortgage, indenture or instrument or other evidence of
indebtedness of the Company for borrowed money, in an aggregate amount exceeding
$5 million, and the continuation thereof for 90 days after written notice to the
Company as provided in the Note Indenture; and (5) certain events of bankruptcy,
insolvency or reorganization.
If an event of default occurs and is continuing, either the Note Trustee or
the Holders of at least 25% in principal amount of the outstanding Notes may
declare the principal amount of all Notes to be due and payable immediately. At
any time after the declaration of acceleration with respect to the Notes has
been made, but before a judgment or decree based on acceleration has been
obtained, the Holders of a majority in principal amount of the outstanding Notes
may, under certain circumstances, rescind and annul such acceleration and its
consequences.
The Note Indenture provides that the Note Trustee generally will be under
no obligation to exercise any of its rights or powers under the Note Indenture
at the request or direction of any of the Holders, unless such Holders have
offered to the Note Trustee indemnity acceptable to the Note Trustee. The
Holders of a majority in principal amount of the outstanding Notes generally
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Note Trustee, or exercising any trust
or power conferred on the Note Trustee, with respect to the Notes. The right of
a Holder of any Note to institute a proceeding with respect to the Note
Indenture is subject to certain conditions precedent, but each Holder has an
absolute right to receive payment of principal (and premium, if any) and
interest when due (subject, in the case of interest, to certain limited
exceptions) and to institute suit for the enforcement of any such payment. The
Note Indenture provides that the Note Trustee, within 90 days after the
occurrence of a default with respect to the Notes, is required to give the
Holders of the Notes notice of such default, unless cured or waived, but, except
in the case of default in the payment of principal of (and premium, if any) or
interest on any Note, the Note Trustee may withhold such notice if it determines
that it is in the interest of such Holders to do so.
The Company is and will be required to furnish annually to the Note Trustee
a statement as to the performance by the Company of certain of its obligations
under the Note Indenture and as to any default in such performance.
Consolidation, Merger, Sale or Conveyance. The Note Indenture provides that
the Company may, without the consent of the Holders of the Notes, consolidate
with, or transfer all or substantially all of its property and assets to, or
merge into another corporation, only if in any such case (1) if the Company is
not the continuing corporation, the successor corporation assumes by a
9
<PAGE> 11
supplemental indenture the Company's obligations under the Note Indenture and
(2) immediately after giving effect to such transaction no event of default, and
no event which after notice or lapse of time or both would become an event of
default, has occurred and is continuing.
Modification and Waiver. Modification and amendment of the Note Indenture
may be effected by the Company and the Note Trustee with the consent of the
Holders of a majority in principal amount of the outstanding Notes affected
thereby, provided that no such modification or amendment may, without the
consent of the Holder of each outstanding Note affected thereby, (1) change the
stated maturity of the principal of, or any installment of interest on, any Note
or any premium payable on the redemption thereof, or change the redemption
price; (2) reduce the principal amount of, or the interest payable on, any Note
or reduce the amount of principal that could be declared due and payable prior
to the stated maturity; (3) change the place or currency of any payment of
principal of or any premium or interest on any Note; (4) impair the right to
institute suit for the enforcement of any payment on or with respect to any
Note, (5) reduce the percentage in principal amount of outstanding Notes the
consent of whose Holders is required to modify or amend the Note Indenture or to
waive compliance with certain provisions of the Note Indenture; or (6) modify
the foregoing requirements or reduce the percentage of outstanding Notes
necessary to waive any past default to less than a majority. Modification and
amendment of the Note Indenture may be effected by the Company and the Note
Trustee without the consent of the Holders (a) to add to the covenants of the
Company for the benefit of the Holders or to surrender a right or power
conferred on the Company in the Note Indenture, (b) to secure the Notes, or (c)
to make certain other modifications, generally of a ministerial or immaterial
nature. Except with respect to certain fundamental provisions, the Holders of at
least a majority in principal amount of outstanding Notes may waive past
defaults under the Note Indenture and waive compliance by the Company with
certain provisions of the Note Indenture.
Book-Entry Notes. Each Medium-Term Note will be issued only in fully
registered form and will be represented by a global certificate (a "Book-Entry
Note") registered in the name of a nominee of The Depository Trust Company or
other depository (the "Depositary"). Upon issuance, all Book-Entry Notes having
the same original issue date, maturity date, redemption provisions, if any, and
interest rate will be represented by a single global security. Book-Entry Notes
will be issued in minimum denominations of $1,000 and integral multiples of
$1,000 in excess thereof. Each global security representing Book-Entry Notes
will be deposited with, or on behalf of, the Depositary and registered in the
name of such Depositary or its nominee. Book-Entry Notes will not otherwise be
issuable in definitive form. Unless otherwise specified in the applicable
Pricing Supplement, the Depositary will be The Depository Trust Company, New
York, New York.
Ownership of beneficial interests in a global security representing
Book-Entry Notes will be limited to institutions that have accounts with the
Depositary or its nominee ("participants") or persons that may hold interests
through participants. In addition, ownership of beneficial interests by
participants in such a global security will only be evidenced by, and the
transfer of that ownership interest will only be effected through, records
maintained by the Depositary or its nominee for such global security. Ownership
of beneficial interests in such a global security by persons that hold through
participants will only be evidenced by, and the transfer of that ownership
interest will only be effected through, records maintained by such participant.
The principal amount of such ownership interest may be in a minimum amount of
$1,000. The laws of some jurisdictions require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
laws may impair the ability to transfer beneficial interests in such a global
security.
The Company has been advised by the Depositary that upon the issuance of a
global security representing Book-Entry Notes and the deposit of such global
security with the Depositary, the Depositary will immediately credit, on its
book-entry registration and transfer systems, the respective principal amounts
of the Book-Entry Notes represented by such global security to the accounts of
participants who have purchased such Book-Entry Notes. The accounts to be
credited will be designated by the underwriters, agents or other persons through
whom the Medium-Term Notes are
10
<PAGE> 12
offered and sold or, to the extent that the Book-Entry Notes are offered and
sold directly, by the Company.
So long as the Depositary or its nominee is the registered owner of a
Book-Entry Note, such Depositary or nominee, as the case may be, will be
considered the sole owner of such Book-Entry Note for all purposes under the
Note Indenture and such Book-Entry Note. Except as provided below, owners of
beneficial interests in a Book-Entry Note will not be entitled to have
Medium-Term Notes represented by such Book-Entry Note registered in their names,
will not receive or be entitled to receive physical delivery of a Note
represented by a certificate upon exchange or otherwise, and will not be
considered the owners or Holders thereof under the Note Indenture. Accordingly,
each person owning a beneficial interest in the Book-Entry Note must rely on the
procedures of the Depositary and, if such person is not a participant, on the
procedures of the participant through which such person owns its interest, to
exercise any rights of a Holder of a Note under the Note Indenture. The Company
understands that under existing industry practices, if the Company requests any
action of Holders or if an owner of a beneficial interest in a Book-Entry Note
desires to give or take any action which a Holder is entitled to give or take
under the Note Indenture, the Depositary for such Book-Entry Note would
authorize the participants holding the relevant beneficial interests to give or
take such action, and such participants would authorize beneficial owners owning
through such participants to give or take such actions or would otherwise act
upon the instructions of beneficial owners holding through them.
Principal, premium, if any, and interest payments on Book-Entry Notes
registered in the name of the Depositary or its nominee will be made to the
Depositary or its nominee as the registered owner of such Book-Entry Notes. None
of the Company, the Note Trustee, any paying agent or the security registrar for
such Book-Entry Notes will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests in such Book-Entry Notes or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
The Company expects that the Depositary for Book-Entry Notes or its
nominee, upon receipt of any payment of principal, premium or interest in
respect of a Book-Entry Note, will credit immediately participants' accounts
with payments in amounts proportionate to their respective beneficial interests
in the principal amount of such Book-Entry Notes as shown on the records of the
Depositary or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in such Book-Entry Notes held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such participants. However, the Company has no control over
the practices of the Depositary or the participants and there can be no
assurance that such practices will not change.
A Book-Entry Note is exchangeable for a note represented by a certificate
only if (i) the Depositary with respect to such Book-Entry Note notifies the
Company that it is unwilling or unable to continue as Depositary for such
Book-Entry Note or if at any time such Depositary ceases to be a clearing agency
registered under the Exchange Act and, in each case, a successor to the
Depositary has not been appointed by the Company within 90 days of such notice
or cessation, (ii) the Company determines at any time not to have Notes
represented by one or more Book-Entry Notes, or (iii) the Company receives
notice of acceleration of the indebtedness under the Notes in accordance with
the terms of the Notes.
The Depository Trust Company has advised the Company as follows: The
Depositary is a limited-purpose trust company organized under New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. The
Depositary was created to hold securities of its participants and to facilitate
the clearance and
11
<PAGE> 13
settlement of securities transactions among its participants in such securities
through electronic book-entry changes in accounts of the participants, thereby
eliminating the need for physical movement of securities certificates. The
Depositary's participants include securities brokers and dealers, banks, trust
companies, clearing corporations, and certain other organizations, some of whom
(and/or their representatives) own the Depositary. Access to the Depositary's
book-entry system is also available to others, such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a participant, either directly or indirectly. Persons who are not participants
may beneficially own securities held by the Depositary only through
participants.
PLAN OF DISTRIBUTION
Under the terms of a Selling Agency Agreement (the "Selling Agency
Agreement"), the Medium-Term Notes are offered on a continuous basis by the
Company through Salomon Brothers Inc, First Chicago Capital Markets, Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Smith Barney Inc.
(collectively, the "Agents"), each of whom has agreed to use its reasonable
efforts to solicit offers to purchase the Medium-Term Notes. The Company has
agreed to pay each Agent a commission of .125% to .750% of the principal amount
of each Medium-Term Note sold through such Agent, depending upon the maturity of
the Medium-Term Note. Commissions on Medium-Term Notes with maturities in excess
of 30 years will be agreed upon between the Company and the Agents at the time
of sale and may exceed .750% of the principal amount of such Medium-Term Notes.
The Company may also sell the Medium-Term Notes to any Agent, acting as
principal, at a discount to be agreed upon at the time of sale, for resale to
one or more investors or other purchasers at varying prices related to
prevailing market prices at the time or times of resale, as determined by such
Agent, or if agreed, at a fixed public offering price. The interest rate on any
Note may not exceed nine (9%) percent per year, unless the Company applies for
and receives an order of the LPSC allowing a higher rate to be paid. The Company
may also sell the Notes directly to investors or other purchasers on its own
behalf or through others. In the case of sales made directly by the Company, no
commission or discount in lieu thereof will be paid or allowed. The Company has
agreed to reimburse the Agents for certain expenses.
The Company has reserved the right to sell Medium-Term Notes to or through
one or more other agents. The identity of any other agent will be set forth in
the Pricing Supplement relating to the Medium-Term Notes sold by such other
agent. Any sales of Medium-Term Notes to or through other agents will be made in
accordance with an agreement between the Company and such agents, the terms of
which agreement will be substantially similar to those contained in the Selling
Agency Agreement.
The Company will have the sole right to accept offers to purchase
Medium-Term Notes and may reject any proposed purchase of Medium-Term Notes in
whole or in part. Each Agent will have the right, in its discretion reasonably
exercised, to reject any offer to purchase Medium-Term Notes received by it, in
whole or in part.
No Note will have an established trading market when issued. The Company
has advised the Agents that the Notes will not be listed on any securities
exchange. Each Agent may make a market in the Notes, but such Agent is not
obligated to do so and may discontinue any market-making at any time without
notice. There can be no assurance of a secondary market for any Notes, or that
the Notes will be sold. The Medium-Term Notes may be sold outside the United
States.
Each of the Agents has in the past engaged in transactions with and
performed services for the Company in the ordinary course of business.
The Company has agreed to indemnify each Agent against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribute to payments such Agent may be
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<PAGE> 14
required to make in respect thereof. Each Agent and any other agent may be
deemed to be an "underwriter" within the meaning of the Securities Act of 1933,
as amended.
LEGAL OPINIONS
Certain legal matters in connection with the sale of the Medium-Term Notes
are being passed upon for the Company by Gordon, Arata, McCollam & Duplantis,
L.L.P., New Orleans, Louisiana. The legality of the Medium-Term Notes will be
passed upon for any underwriters, dealers or agents by Brown & Wood LLP, New
York, New York. Brown & Wood LLP will rely as to all matters of Louisiana law
upon the opinion of Gordon, Arata, McCollam & Duplantis, L.L.P.
EXPERTS
The consolidated balance sheets as of December 31, 1995 and 1994 and the
consolidated statements of income, cash flows and changes in common
shareholders' equity for each of the three years in the period ended December
31, 1995, and the related notes and schedule, which are included or incorporated
by reference in the Company's Annual Report on Form 10-K for the year ended
December 31, 1995, and which are incorporated by reference in this Prospectus,
have been included herein in reliance on the reports (also incorporated by
reference herein) of Coopers & Lybrand L.L.P., independent accountants, given on
the authority of that firm as experts in auditing and accounting.
13
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 16. EXHIBITS.
See Index to Exhibits at page II-3.
II-1
<PAGE> 16
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to
Form S-3 Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Pineville and State of Louisiana, on
the 10th day of December, 1996.
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
By: /s/ GREGORY L. NESBITT
----------------------------------------
Gregory L. Nesbitt
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- --------------------------------- ------------------
<C> <S> <C>
/s/ GREGORY L. NESBITT President and Chief Executive December 10, 1996
- --------------------------------------------- Officer (Principal Financial
(Gregory L. Nesbitt) Officer)
/s/ JOHN L. BALTES, JR. Controller (Principal Accounting December 10, 1996
- --------------------------------------------- Officer)
(John L. Baltes, Jr.)
SHERIAN G. CADORIA*
J. PATRICK GARRETT*
F. BEN JAMES, JR.*
HUGH J. KELLY*
A. DELOACH MARTIN, JR.* The Board of Directors December 10, 1996
GREGORY L. NESBITT*
ROBERT T. RATCLIFF*
EDWARD M. SIMMONS*
ERNEST L. WILLIAMSON*
WILLIAM H. WALKER, JR.*
*By: /s/ MICHAEL P. PRUDHOMME
- ---------------------------------------------
(Michael P. Prudhomme,
as Attorney-in-Fact)
</TABLE>
<PAGE> 17
INDEX TO EXHIBITS
The exhibits designated by an asterisk are filed herewith. The exhibits not
so designated heretofore have been filed with the Commission and, pursuant to
Rule 411(c) under the Securities Act and Rule 12b-32 under the Exchange Act, are
incorporated herein by reference to the documents indicated following the
description of such exhibits.
<TABLE>
<CAPTION>
SEC FILE OR REGISTRATION
REGISTRATION STATEMENT OR EXHIBIT
NUMBER REPORT NUMBER
------------ ------------ ------
<C> <S> <C> <C> <C>
*1 -- Form of Selling Agency Agreement to
be entered into by and among the
Company and the Agents named therein
12 -- Statement of Computation of Ratio of 1-5663 10-Q 12
Earnings to Fixed Charges (3rd Quarter
1996)
*23(c) -- Consent of Coopers & Lybrand L.L.P.
*24 -- Power of Attorney of William H.
Walker, Jr.
*99 -- Order of the Louisiana Public Service
Commission dated December 4, 1996.
</TABLE>
<PAGE> 1
EXHIBIT 1
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
$200,000,000 MEDIUM-TERM NOTES
DUE MORE THAN ONE YEAR FROM DATE OF ISSUE
SELLING AGENCY AGREEMENT
December , 1996
New York, New York
Salomon Brothers Inc
Seven World Trade Center
New York, NY 10048
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower
New York, NY 10291-1311
Smith Barney Inc.
390 Greenwich Street
New York, NY 10013
First Chicago Capital Markets, Inc.
One First National Plaza
Chicago, IL 60670
Dear Sirs:
Central Louisiana Electric Company, Inc., a Louisiana corporation (the
"Company"), confirms its agreement with each of you with respect to the issue
and sale by the Company of its Medium-Term Notes due more than one year from
Date of Issue (the "Notes"). As of the date hereof, the Company has authorized
the issuance of up to $200,000,000 aggregate principal amount of Notes
distributed through or sold to you pursuant to the terms of this Agreement. It
is understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such notes may be distributed through or
sold to you pursuant to the terms of this Agreement, all as though the issuance
of such Notes were authorized as of the date hereof. The Notes will be issued
under an indenture (the "Indenture") dated as of October 1, 1988 between the
Company and The Bank of New York (successor to Bankers Trust Company), as
trustee (the "Trustee"). Unless otherwise set forth in a supplement to the
prospectus referred to below, the Notes will be issued in minimum denominations
of $1,000 and integral multiples of $1,000 in excess thereof, will be issued
only in fully registered form and will have the annual interest rates,
maturities and, if appropriate, other terms set forth in such supplement to the
Prospectus. The Notes will be issued, and the terms thereof established, in
accordance with the Indenture (unless a Terms Agreement (as defined in Section
2(b)) modifies or otherwise supersedes the procedures with respect to the Notes
issued pursuant to such Terms Agreement). For the purposes of this Agreement,
the term "Agent" shall refer to any of you acting solely in the capacity as
agent for the Company pursuant to Section 2(a) and not as principal
(collectively, the "Agents"), the term "Purchaser" shall refer to one of you
acting solely as principal pursuant to Section 2(b) and not as agent, and the
term "you" shall refer to you collectively whether at any time any of you is
acting in both such capacities or in either such capacity. The Company and those
of you that were party to the Selling Agency
1
<PAGE> 2
Agreement dated February 27, 1992, as amended, agree and acknowledge that such
Selling Agency Agreement is hereby terminated.
1. Representations and Warranties. The Company represents and warrants to,
and agrees with, you as set forth below in this Section 1. Certain terms used in
this Section 1 are defined in paragraph (c) hereof.
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "1933 Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement on such Form, including a basic prospectus, which has been
declared effective by the Commission, for the registration under the 1933
Act of the Notes. Such registration statement, as amended at the date of
this Agreement, meets the requirements set forth in Rule 415(a)(1)(x) under
the 1933 Act. In connection with the sale of Notes the Company proposes to
file with the Commission pursuant to the applicable paragraph of Rule
424(b) under the 1933 Act further supplements to the Prospectus specifying
the interest rates, maturity dates and, if appropriate, other terms of the
Notes sold pursuant hereto or the offering thereof.
(b) As of the Execution Time, on the Effective Date, when any
supplement to the Prospectus is filed with the Commission, as of the date
of each acceptance by the Company of an offer for the purchase of Notes
(whether to an Agent as principal or through an Agent as agent) and as of
the date of delivery of Notes (whether to an Agent as principal or an Agent
as agent) (a "Closing Date") (each of the times referenced above being
referred to hereafter as a "Representation Date"):
(i) Due Incorporation. The Company has been duly incorporated and
is validly existing as a corporation in good standing under the laws of
the State of Louisiana and has the corporate power and authority to own
its properties and to conduct its business as described in the
Registration Statement.
(ii) Subsidiaries. The Company has no "Significant Subsidiaries",
as such term is defined in Rule 405 of Regulation C of the rules and
regulations under the 1933 Act (the "1933 Act Regulations").
(iii) Registration Statement and Prospectus. At the time the
Registration Statement became effective, the Registration Statement
complied, and as of the applicable Representation Date will comply, in
all material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the Trust Indenture Act of 1939, as amended (the
"1939 Act"), and the rules and regulations of the Commission promulgated
thereunder. The Registration Statement, at the time it became effective,
did not, and at each time thereafter at which any amendment to the
Registration Statement becomes effective and any Annual Report on Form
10-K is filed by the Company with the Commission and as of the
applicable Representation Date, will not, contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus, as of the date hereof does not, and as of the applicable
Representation Date will not, contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the representations
and warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information furnished to the Company in
writing by any of you expressly for use in the Registration Statement or
Prospectus or to that part of the Registration Statement which
constitutes the Trustee's Statement of Eligibility and Qualification
under the 1939 Act (the "Form T-1").
2
<PAGE> 3
(iv) Incorporated Documents. The documents incorporated by
reference in the Prospectus, at the time they were or hereafter are
filed with the Commission, complied or, when so filed, will comply, as
the case may be, in all material respects with the requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the
rules and regulations thereunder (the "1934 Act Regulations"), and, when
read together and with the other information in the Prospectus, did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which
they were or are made, not misleading.
(v) Accountants. Coopers & Lybrand L.L.P., who have reported upon
certain of the financial statements incorporated by reference in the
Registration Statement, are independent public accountants as required
by the 1933 Act and the 1933 Act Regulations.
(vi) Financial Statements. The financial statements and
supplemental schedules set forth in or incorporated by reference in the
Registration Statement and Prospectus have been prepared from the books
and records of the Company in accordance with generally accepted
accounting principles consistently followed throughout the periods
indicated (except as may be noted therein) and present fairly the
financial position of the Company at the dates indicated and the results
of its operations, its cash flows and changes in its capital for the
periods then ended.
(vii) Material Changes or Material Transactions. Since the
respective dates as of which information is given in the Registration
Statement and Prospectus, except as otherwise stated therein, (i) there
has not been any material adverse change in the condition of the
Company, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company, whether or not arising in the
ordinary course of business and (ii) no material transaction has been
entered into by the Company other than transactions contemplated by the
Registration Statement and transactions in the ordinary course of
business.
(viii) No Defaults. The Company is not in violation of or in
default under any term or provision of the Restated Articles of
Incorporation or amended and restated bylaws of the Company, as amended,
or of any mortgage, indenture, contract, agreement, instrument,
judgment, decree or order applicable to the Company or of any statute,
rule or regulation, where such violation or default would have a
material adverse effect upon the properties, assets, business, prospects
or condition (financial or otherwise) of the Company, and no event or
condition has occurred or exists which, with the giving of notice or
lapse of time or both, would result in any such violation or default
which would have such an effect.
(ix) Regulatory Approvals. The Louisiana Public Service Commission
(the "LPSC") has authorized or, prior to any offering or sale of Notes
by the Company, will have authorized, the issuance and sale of the Notes
then being so offered or sold; and, other than approvals that may be
required under state securities laws, no other approval of any
regulatory public body, state or federal, including approval of the
Federal Energy Regulatory Commission ("FERC") that may be required under
the Federal Power Act, as amended, is necessary in connection with the
issuance and sale of the Notes pursuant to this Agreement.
(x) Legal Proceedings. Except as described in the Registration
Statement, there is no material litigation or governmental proceeding
involving or, to the knowledge of the Company, threatened against the
Company which might reasonably be expected to result in any material
adverse change in the financial condition, results or operations or
business of the Company or which is required to be disclosed in the
Registration Statement, and no notice has been given by any governmental
authority of any proceeding to condemn any
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<PAGE> 4
material properties of the Company, and, to the knowledge of the
Company, no such proceeding is contemplated.
(xi) Good Title. The Company has good title (either by way of fee
simple, leasehold, easement, right-of-way, grant, servitude, privilege,
permit, franchise or license, as the case may be) to all its properties
including, without limitation, the properties reflected in the most
recent balance sheet of the Company incorporated by reference in the
Registration Statement (except for such items thereof which have been
disposed of since such date and which do not, in the aggregate,
constitute a substantial amount) subject only to (i) the lien of the
Indenture of Mortgage, dated as of July 1, 1950, as supplemented, from
the Company to First National Bank of Commerce, as trustee, securing the
Company's First Mortgage Bonds, and encumbrances permitted thereby and
(ii) other encumbrances and defects which do not in the aggregate
materially detract from the value of the properties of the Company or
impair or interfere with the use of properties material to the business
and operations of the Company.
(xii) Regulatory Compliance. The Company is in substantial
compliance with all federal and state environmental statutes, rules and
regulations and, to the Company's knowledge, has received all required
permits necessary for the operation of its business under such statutes,
rules and regulations.
(xiii) Authorization and Validity of the Notes. When issued,
authenticated and delivered pursuant to the provisions of this Agreement
and the Indenture against payment of the consideration therefor
specified in the Prospectus or in any Terms Agreement, the Notes will
have been duly authorized for issuance and sale pursuant to this
Agreement and will constitute valid and legally binding obligations of
the Company enforceable in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting creditors' rights
generally or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law); the
Notes and the Indenture will be substantially in the form heretofore
delivered to you and conform in all material respects to all statements
relating thereto contained in the Prospectus; and the Notes will be
entitled to the benefits provided by the Indenture.
(xiv) Issuance of Notes. The consummation of the transactions
contemplated by this Agreement and the performance of the Company's
obligations hereunder will not result in any material violation of, or
be in material conflict with or constitute a material default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any of the properties or assets of the Company that are material to
the conduct of its business under the Restated Articles of Incorporation
or amended and restated bylaws of the Company, as amended, or any
material mortgage, contract, indenture, agreement or instrument to which
the Company is a party or by which it is bound, or any judgment, order,
statute, rule or regulation applicable to it of any court or
governmental body or instrumentality having jurisdiction over it or its
properties; the Company has full legal right, power and authority to
enter into this Agreement and, upon any offer or sale by the Company of
the Notes, shall have full legal right, power and authority to offer,
issue, sell and deliver such Notes.
(xv) 1935 Act. To the Company's knowledge, no person or corporation
which is a "Holding Company" or a "Subsidiary Company" of a "Holding
Company", within the meaning of such terms as defined in the Public
Utility Holding Company Act of 1935 (the "1935 Act"), directly or
indirectly owns, controls or holds with power to vote 10% or more of the
outstanding voting securities of the Company, and the Company is not a
"Holding Company" or a "Subsidiary Company" of a "Holding Company" as
such terms are defined in the 1935 Act.
4
<PAGE> 5
(c) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "the Effective Date" shall mean each date
that the Registration Statement and any post-effective amendment or
amendments thereto became or become effective. "Execution Time" shall mean
the date and time that this Agreement is executed and delivered by the
parties hereto. The registration statement referred to in paragraph (a)
above and the prospectus constituting a part thereof, and any prospectus
supplements relating to the Notes, including in each case all documents
incorporated therein by reference, as from time to time amended or
supplemented by the filing of documents pursuant to the 1934 Act or the
1933 Act or otherwise, are referred to herein as the "Registration
Statement" and the "Prospectus", respectively. Additionally, however, and
notwithstanding anything herein to the contrary, every reference herein to
"registration statement" or "Registration Statement" shall, for all
purposes hereof (including, but not limited to, the reading of each
applicable representation and warranty and of each agreement with respect
to indemnification and contribution), include and be deemed to refer to any
further registration statements (and amendments and supplements thereto)
which may be filed by the Company for the purpose of registering additional
Notes and in connection with which this Agreement is included as an
exhibit.
2. Appointment of Agents; Solicitation by the Agents of Offers to Purchase;
Sales of Notes to a Purchaser.(a) Subject to the terms and conditions set forth
herein, the Company hereby authorizes each of the Agents to act as its agent to
solicit offers for the purchase of all or part of the Notes from the Company.
On the basis of the representations and warranties, and subject to the
terms and conditions set forth herein, each of the Agents agrees, as agent of
the Company, to use its reasonable efforts to solicit offers to purchase the
Notes from the Company upon the terms and conditions set forth in the Prospectus
(and any supplement thereto). Each Agent shall make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose offer to purchase
Notes has been solicited by such Agent and accepted by the Company, but such
Agent shall not, except as otherwise provided in this Agreement, be obligated to
disclose the identity of any purchaser or have any liability to the Company in
the event any such purchase is not consummated for any reason. Except as
provided in Section 2(b), under no circumstances will any Agent be obligated to
purchase any Notes for its own account. It is understood and agreed, however,
that any Agent may purchase Notes as principal pursuant to Section 2(b). If the
purchase price for any Note is not timely paid with respect to such Note by the
beneficial purchaser thereof (or a person, including an indirect participant in
The Depository Trust Company, acting on behalf of such purchaser), the
settlement with respect to such Note will be reversed. If such failure shall
have occurred for any reason other than a default by the Agent that presented
such beneficial purchaser in the performance of its obligations hereunder, then
the Company will reimburse such Agent on an equitable basis for the loss of the
use of the funds during the period when they were credited to the account of the
Company.
The Company reserves the right, in its sole discretion, to instruct the
Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase the Notes. Upon receipt of instructions from
the Company, the Agents will forthwith suspend solicitation of offers to
purchase Notes from the Company until such time as the Company has advised them
that such solicitation may be resumed. In the event that at the time the Company
suspends solicitation of purchases there shall be any orders outstanding for
settlement, the Company will promptly advise the Agents and the Trustee whether
such orders may be settled and whether copies of the Prospectus as in effect at
the time of the suspension, together with the appropriate Pricing Supplement,
may be delivered in connection with the settlement of such orders. The Company
will have the sole responsibility for such decision and for any arrangements
that may be made in the event that the Company determines that such orders may
not be settled or that copies of such Prospectus may not be so delivered.
5
<PAGE> 6
The Company agrees to pay such Agent a commission, on the Closing Date with
respect to each sale of Notes by the Company as a result of a solicitation made
by such Agent, in an amount equal to that percentage specified in Schedule I
hereto of the aggregate principal amount of the Notes so sold by the Company.
Subject to the provisions of this Section, offers for the purchase of Notes
may be solicited by an Agent as agent for the Company at such time and in such
amounts as such Agent deems advisable, subject to rejection by the Company of
any such offer. The Company may from time to time offer Notes for sale otherwise
than through an Agent; provided, however, that so long as this Agreement shall
be in effect the Company shall not solicit or accept offers to purchase Notes
through any agent other than an Agent, except, in connection with offers to
purchase Notes received by the Company through any agent other than an Agent,
the Company may accept any such offer made through such agent so long as the
Company gives the Agents reasonable prior notice of such acceptance and any such
agent enters into an agreement with the Company on terms which are substantially
similar to those contained or incorporated in this Agreement.
Each Agent shall communicate to the Company, orally or in writing, each
reasonable offer to purchase Notes received by such Agent as agent. The Company
shall have the sole right to accept offers to purchase the Notes and may reject
any such offer in whole or in part.
If the Company shall default in its obligations to deliver Notes to a
purchaser whose offer it has accepted, the Company shall indemnify and hold each
of you harmless against any loss, claim or damage arising from or as a result of
such default by the Company.
(b) Unless otherwise agreed in connection with a particular sale of Notes,
it is understood that the Agents will act as agents of the Company in connection
with the sale of the Notes. Subject to the terms and conditions stated herein,
whenever the Company and any Agent determine that the Company shall sell Notes
directly to such Agent as principal, each such sale of Notes shall be made in
accordance with the terms of this Agreement and a supplemental agreement
relating to such sale between the Company and the Purchaser. Each such
supplemental agreement (which may be an oral or written agreement) is herein
referred to as a "Terms Agreement". Each Terms Agreement shall describe (whether
orally or in writing) the Notes to be purchased by the Purchaser pursuant
thereto and shall specify the principal amounts of such Notes, the aggregate
principal amount of such Notes, the maturity date of such Notes, the rate at
which interest will be paid on such Notes, the dates on which interest will be
paid on such Notes and the record date with respect to each such payment of
interest, the Closing Date for the purchase of such Notes, the place of delivery
of the Notes and payment therefor, the method of payment, whether the Notes will
be redeemable at the option of the Company or any holder thereof and whether the
delivery of opinions of counsel, certificates from the Company or its officers
or a letter from the Company's independent public accountants as described in
Section 6(b) will be required. Any such Terms Agreement may also specify the
period of time referred to in Section 4(m). Any written Terms Agreement may be
in the form attached hereto as Exhibit A. The Purchaser's commitment to purchase
Notes shall be deemed to have been made on the basis of the representations and
warranties of the Company herein contained and shall be subject to the terms and
conditions herein set forth.
Delivery of the Notes sold to the Purchaser pursuant to a Terms Agreement
shall be made not later than the Closing Date agreed to in such Terms Agreement,
against payment of funds to the Company in the net amount due to the Company for
such Notes by the method and in the form agreed to between the Company and the
Purchaser.
Unless otherwise agreed to between the Company and the Purchaser in a Terms
Agreement, any Note sold to a Purchaser (i) shall be purchased by such Purchaser
at a price equal to 100% of the principal amount thereof less a percentage equal
to the commission applicable to an agency sale of a Note of identical maturity
and (ii) may be resold by such Purchaser at varying prices from time to time. In
connection with any resale of Notes purchased, a Purchaser may use a selling or
dealer
6
<PAGE> 7
group and may reallow any portion of the discount or commission payable pursuant
hereto to dealers or other purchasers.
(c) No provision contained in this Agreement shall impair the right of the
Company, which shall be absolute, to solicit on its own behalf and accept offers
to purchase Notes, and in no such event shall commissions be payable to an Agent
except in the case of the issuance and sale of a Note resulting from a
solicitation made by such Agent.
3. Offering and Sale of Notes. Settlement procedures shall be agreed to by
the Company and the Agents from time to time, provided, that upon the acceptance
of an offer to purchase Notes, whether as an Agent as principal or an Agent as
agent, such Agent shall deliver to the Company the terms of any such purchase as
soon as practicable after the determination of such terms. Each of you and the
Company agrees to perform the respective duties and obligations agreed to
pursuant to the immediately preceding sentence.
4. Agreements. The Company agrees with you that:
(a) Prior to the termination or suspension of the offering of the
Notes (including by way of resale by a Purchaser of Notes), the Company
will not file any amendment to the Registration Statement or supplement to
the Prospectus (except for (i) periodic or current reports filed under the
1934 Act, or (ii) a supplement relating to any offering of Notes providing
solely for the specification of or a change in the maturity dates, interest
rates, issuance prices or other similar terms of any Notes unless the
Company has furnished each of you a copy for your review prior to filing
and given each of you a reasonable opportunity to comment on any such
proposed amendment or supplement. Each of you shall make your responses
thereto, if any, promptly. Subject to the penultimately preceding sentence,
the Company will cause each supplement to the Prospectus relating to an
offering of Notes that is to be filed pursuant to the applicable paragraph
of Rule 424(b) under the 1933 Act to be filed with the Commission within
the time period prescribed by such rule and will provide evidence
satisfactory to you of such filing. The Company will promptly advise each
of you (i) when the Prospectus, and any supplement thereto, shall have been
filed with the Commission pursuant to Rule 424(b), (ii) when, prior to the
termination of the offering of the Notes, any amendment of the Registration
Statement shall have been filed or become effective, (iii) of any request
by the Commission for any amendment of the Registration Statement or
supplement to the Prospectus or for any additional information, (iv) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the institution or threatening by direct
communication with the Company of any proceeding for that purpose and (v)
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for sale in any jurisdiction
or the initiation or threatening by direct communication with the Company
of any proceeding for such purpose. The Company will use its reasonable
best efforts to prevent the issuance of any such stop order and, if issued,
to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the 1933 Act, any event occurs as a result
of which the Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it shall be necessary to amend
the Registration Statement or to supplement the Prospectus to comply with
the 1933 Act or the 1934 Act or the respective rules thereunder, the
Company promptly will (i) notify each of you to suspend solicitation of
offers to purchase Notes (and, if so notified by the Company, each of you
shall forthwith suspend such solicitation and any sales of Notes any of you
may hold as principal and cease using the Prospectus as then supplemented),
(ii) prepare and file with the Commission, subject to the first sentence of
paragraph (a) of this Section 4, an amendment or supplement which will
correct such statement or omission or effect such compliance and (iii)
supply any supple-
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<PAGE> 8
mented Prospectus to each of you in such quantities as you may reasonably
request. You will, upon the filing of such amendment or supplement with the
Commission or upon the effectiveness of an amendment to the Registration
Statement, if such an amendment is required, resume your obligation to
solicit offers to purchase Notes hereunder, subject to the second paragraph
of Section 2 hereof.
(c) The Company, during the period when a prospectus relating to the
Notes is required to be delivered under the 1933 Act, will file promptly
all documents required to be filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the 1934 Act and will furnish to each of you
copies of such documents. In addition, on or prior to the date on which the
Company makes any announcement to the general public concerning earnings or
concerning any other event which is required to be described, or which the
Company proposes to describe, in a document filed pursuant to the 1934 Act,
the Company will furnish to each of you the information contained or to be
contained in such announcement or document. The Company also will furnish
to each of you copies of all other material press releases or announcements
to the general public. The Company will immediately notify each of you of
(i) any decrease in the rating of the Notes or any other debt securities of
the Company by any "nationally recognized statistical rating organization"
(as defined for purposes of Rule 436(g) under the 1933 Act) or (ii) any
public notice given of any intended or potential decrease in any such
rating or of a possible change in any such rating that does not indicate
the direction of the possible change, as soon as the Company learns of any
such decrease or notice.
(d) As soon as practicable, but not later than 90 days after the close
of the period covered by the earnings statement, the Company will make
generally available to its security holders and to each of you an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 under
the 1933 Act.
(e) The Company will furnish to each of you and your counsel, without
charge, copies of the Registration Statement (including exhibits thereto)
as you may reasonably request and, so long as delivery of a prospectus may
be required by the 1933 Act, as many copies of the Prospectus and any
supplement thereto as you may reasonably request so long as you are
required to deliver a Prospectus in connection with sales or solicitations
of offers to purchase the Notes.
(f) The Company will endeavor, in cooperation with the Agents, to
arrange for the qualification of the Notes for sale under the laws of such
jurisdictions of the United States of America as any of you may designate,
will maintain such qualifications in effect so long as required for the
distribution of the Notes, and will endeavor, in cooperation with the
Agents, to arrange for the determination of the legality of the Notes for
purchase by institutional investors; provided, however, that the Company
shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation in any jurisdiction in which it is not
so qualified.
(g) The Company shall furnish to each of you such information,
documents, certificates of officers of the Company and opinions of counsel
for the Company reasonably related to the Company's business in the context
of a distribution of the Notes, the Registration Statement, the Prospectus,
and any amendments thereof or supplements thereto, the Indenture, the
Notes, this Agreement and the performance by the Company and you of its and
your respective obligations hereunder and thereunder as any of you may from
time to time and at any time prior to the termination of this Agreement
reasonably request.
(h) The Company shall, whether or not any sale of the Notes is
consummated, (i) pay all expenses incident to the performance of its
obligations under this Agreement, including the fees and disbursements of
its accountants and counsel, the cost of printing or other production and
delivery of the Registration Statement, the Prospectus, all amendments
thereof and supplements thereto, the Indenture and this Agreement, the cost
of preparing, printing, packaging and
8
<PAGE> 9
delivering the Notes, the fees and disbursements, including fees of counsel
for the Agents, incurred in compliance with Section 4(f), the fees and
disbursements of the Trustee and the fees of any agency that rates the
Notes, (ii) reimburse each of you as requested for all out-of-pocket
expenses (including without limitation advertising expenses), if any,
incurred by you with the approval of the Company in connection with this
Agreement and (iii) pay the reasonable fees and expenses of your counsel
incurred in connection with this Agreement.
(i) Each acceptance by the Company of an offer to purchase Notes will
be deemed to be an affirmation that its representations and warranties
contained in this Agreement are true and correct at the time of such
acceptance, as though made at and as of such time, and a covenant that such
representations and warranties will be true and correct at the time of
delivery to the purchaser of the Notes relating to such acceptance, as
though made at and as of such time (it being understood that for purposes
of the foregoing affirmation and covenant such representations and
warranties shall relate to the Registration Statement and Prospectus as
amended or supplemented at each such time). Each such acceptance by the
Company of an offer for the purchase of Notes shall be deemed to constitute
an additional representation, warranty and agreement by the Company that,
as of the settlement date for the sale of such Notes, after giving effect
to the issuance of such Notes and of any other Notes to be issued on or
prior to such settlement date, the aggregate amount of Notes which have
been issued and sold by the Company will not exceed the amount of
securities registered pursuant to the Registration Statement.
(j) Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement relating
to a Current Report on Form 8-K (unless in the reasonable judgment of the
Agents, the information contained therein is material to the offering of
the Notes) providing solely for the specification of or a change in the
maturity dates, the interest rates, the issuance prices or other similar
terms of any Notes sold pursuant hereto or relating to a sale of Notes
directly to a purchaser by the Company on its own behalf), the Company will
deliver or cause to be delivered promptly to each of you a certificate of
the Company, signed by the President or the Executive Vice President and
the principal financial or accounting officer of the Company, dated the
date of the effectiveness of such amendment or the date of the filing of
such supplement, in form reasonably satisfactory to you, of the same tenor
as the certificate referred to in Section 5(e) but modified to relate to
the last day of the fiscal quarter for which financial statements of the
Company were last filed with the Commission and to the Registration
Statement and the Prospectus as amended and supplemented to the time of the
effectiveness of such amendment or the filing of such supplement or, in
lieu thereof, a certificate stating that the statements in the last such
certificate are true and correct at the time of such amendment or
supplement, as the case may be, as though made at and as of such time
(except that such statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such time).
(k) Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement (i)
providing solely for the specification of or a change in the maturity
dates, the interest rates, the issuance prices or other similar terms of
any Notes sold pursuant hereto, (ii) relating to a sale of Notes directly
to a purchaser by the Company on its own behalf, (iii) relating to a
Current Report on Form 8-K (unless in the reasonable judgment of the
Agents, the information contained therein is material to the offering of
the Notes) or (iv) setting forth or incorporating by reference financial
statements or other information as of and for a fiscal quarter, unless, in
the case of clause (iv) above, in the reasonable judgment of any of you,
such financial statements or other information are of such a nature that an
opinion of counsel should be furnished), the Company shall furnish or cause
to be furnished promptly to each of you a written opinion of counsel of the
Company last furnishing the opinion referred to in Section 5(b) hereof or
other counsel satisfactory to each of you, dated the date of the
effectiveness of such amendment or the date of the filing of such
9
<PAGE> 10
supplement, in form satisfactory to each of you, in your reasonable
judgment, of the same tenor as the opinion referred to in Sections 5(b) but
modified to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of the effectiveness of such amendment
or the filing of such supplement or, in lieu of such opinion, Gordon,
Arata, McCollam & Duplantis, L.L.P., or such other counsel who last
rendered such a written opinion, may furnish each of you with a letter to
the effect that you may rely on such last opinion to the same extent as
though it were dated the date of such letter authorizing reliance (except
that statements in such last opinion will be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to
the time of the effectiveness of such amendment or the filing of such
supplement).
(l) Each time that the Registration Statement or the Prospectus is
amended or supplemented to include or incorporate amended or supplemental
financial information, the Company shall cause its independent public
accountants promptly to furnish each of you a letter, dated the date of the
effectiveness of such amendment or the date of the filing of such
supplement, in form satisfactory to each of you, in your reasonable
judgment, of the same tenor as the letter referred to in Section 5(f) with
such changes as may be necessary to reflect the amended and supplemental
financial information included or incorporated by reference in the
Registration Statement and the Prospectus, as amended or supplemented to
the date of such letter; provided, however, that, if the Registration
Statement or the Prospectus is amended or supplemented solely to include or
incorporate by reference financial information as of and for a fiscal
quarter, the Company's independent public accountants may limit the scope
of such letter, which shall be satisfactory in form to each of you, in your
reasonable judgment, to the unaudited financial statements, the related
portions of "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and any other information of an accounting,
financial or statistical nature included in such amendment or supplement,
unless, in the reasonable judgment of any of you, such letter should cover
other information or changes in specified financial statement line items.
(m) During the period between the date of a Terms Agreement and the
Closing Date applicable to such Terms Agreement, the Company shall not,
without the prior consent of the Purchaser thereunder, offer, sell or
contract to sell, or otherwise dispose of, directly or indirectly, or
announce the offering of, any debt securities issued or guaranteed by the
Company (other than the Notes being sold pursuant to such Terms Agreement;
Industrial Development Board of the Parish of Rapides, Inc. Adjustable
Tender Pollution Control Revenue Refunding Bonds (Central Louisiana
Electric Company, Inc. Project) Series 1991; Parish of DeSoto, Louisiana
Adjustable Tender Pollution Control Revenue Refunding Bonds (Central
Louisiana Electric Company, Inc. Project) Series 1991A and Series 1991B, or
any debt securities issued in replacement thereof; commercial paper in the
ordinary course of business or any bank borrowings).
(n) The Company shall not be required to comply with the provisions of
subsections (b), (c), (g) and (l) of this Section 4 during any period from
the time (i) the Agents shall have suspended solicitation or purchases of
the Notes in their capacity as agents pursuant to a request from the
Company and (ii) none of you shall then hold any Notes as principal
purchased pursuant to a Terms Agreement, to the time the Company shall
determine that solicitation of purchases of the Notes should be resumed or
shall subsequently enter into a new Terms Agreement with one or more of
you.
5. Conditions to the Obligations of the Agents. The obligations of each
Agent to solicit offers to purchase the Notes shall be subject to the accuracy
of the representations and warranties on the part of the Company contained
herein as of the Execution Time, on the Effective Date, when any supplement to
the Prospectus is filed with the Commission and as of each Closing Date with
respect to any Terms Agreement, to the accuracy of the statements of the Company
made in any certificates
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<PAGE> 11
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such supplement,
shall have been filed in the manner and within the time period required by
Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b) The Company shall have furnished to each Agent the opinion of
Gordon, Arata, McCollam & Duplantis, L.L.P., counsel for the Company, or
other counsel satisfactory to each Agent, dated the Execution Time, to the
effect that:
(i) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Louisiana and has
all corporate power and authority necessary to own its properties and to
conduct the business in which it is engaged as described in the
Prospectus.
(ii) To their knowledge, after due inquiry, there is no
jurisdiction where the character of the properties owned or the nature
of the business conducted by the Company makes necessary the license or
qualification of the Company as a foreign corporation.
(iii) This Agreement (and the Terms Agreement, if applicable) has
been duly authorized, executed and delivered by the Company.
(iv) The Indenture has been duly authorized, executed and delivered
by the Company.
(v) The Company has taken all necessary corporate action to
authorize the execution and delivery of the Notes.
(vi) Other than in connection with the provisions of securities or
"blue sky" laws of any jurisdiction in which it is proposed that the
Notes be offered and other than the required order or orders of the LPSC
referred to below, no approval, authorization, consent or order of any
public board, body or agency of the State of Louisiana is legally
required as of the date hereof for the issuance and sale of the Notes,
or the performance by the Company of its agreements in this Agreement or
in the Indenture.
(vii) The Company is subject to the jurisdiction of the LPSC and
must obtain the prior approval by the LPSC of the issuance of Notes with
maturities that exceed one year. The order of the LPSC with respect to
the issuance of the Company's debt securities described therein (the
"LPSC Order"), is in full force and effect.
(viii) With immaterial exceptions, the Company has valid and
subsisting franchises, consents, certificates and permits, free from
burdensome conditions or restrictions, sufficient to enable it to carry
on its business in the State of Louisiana and in the communities,
parishes and other governmental subdivisions thereof in which it
operates.
(ix) The execution and delivery of the Indenture and this Agreement
(or a Terms Agreement, if applicable) by the Company and, assuming no
change in facts existing on the date hereof, the execution and delivery
of the Notes by the Company and the performance by the Company of its
agreements therein or herein will not (a) breach or result in a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of the Company that are
described in the Registration Statement and the Prospectus under, any
existing obligation of the Company under any indenture, agreement or
instrument known to them to which the Company is a party or by which it
is bound, (b) breach or otherwise violate any order known to them and
applicable to the Company in effect on the date hereof of any court or
governmental body or instrumentality of the State of Louisiana having
jurisdiction over the Company or its
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properties, (c) violate (i) the Restated Articles of Incorporation or
the Amended and Restated Bylaws of the Company, each as amended to date,
or (ii) any statute of the State of Louisiana in effect on the date
hereof, or any rule or regulation, in effect on the date hereof
applicable to the Company of any governmental body or instrumentality of
the State of Louisiana having jurisdiction over the Company or its
properties, (d) breach or otherwise violate any order known to them and
applicable to the Company in effect on the date hereof of any court or
governmental body or instrumentality of the federal government of the
United States of America having jurisdiction over the Company or its
properties or (e) violate any statute of the federal government of the
United States of America in effect on the date hereof, or any rule or
regulation, in effect on the date hereof applicable to the Company of
any governmental body or instrumentality of the federal government of
the United States of America having jurisdiction over the Company or its
properties.
(x) The terms and provisions of each Specimen Note conform in all
material respects to the descriptions thereof contained in the
Registration Statement and Prospectus.
(xi) No approval, authorization, consent or order of any public
board, body or agency of the federal government of the United States of
America is legally required as of the date hereof for the issuance and
sale of the Notes or the performance by the Company of its agreements in
this Agreement or in the Indenture.
(xii) (a) The Registration Statement has become effective under the
1933 Act and, to their knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
threatened under the 1933 Act; (b) the Registration Statement and the
Prospectus (other than (i) the financial statements and schedules,
including the notes thereto, the auditors' report thereon and the
related summary of accounting policies, contained or incorporated by
reference therein and (ii) the other financial and statistical
information contained or incorporated by reference therein, as to which
no opinion need be rendered) appear on their face to comply as to form
in all material respects with the requirements of Form S-3, the
applicable rules and regulations with respect thereto under the 1939 Act
and the 1933 Act Regulations, to the extent that such requirements,
rules and regulations are applicable to the forms thereof.
(xiii) They do not know of any contracts of a character required to
be described in the Registration Statement or Prospectus or to be filed
or incorporated by reference as exhibits to the Registration Statement
which are not described, filed or incorporated by reference as required.
(xiv) They do not know of any legal proceedings pending or
threatened against the Company of a character which are required to be
disclosed in the Registration Statement and Prospectus which have not
been disclosed therein.
(xv) The Company is not a "Holding Company" or a "Subsidiary
Company" of a "Holding Company" as such terms are defined in the 1935
Act.
(xvi) The issuance and sale of Notes with maturities that exceed
one year do not require approval of the FERC under the provisions of the
FPA.
(xvii) The Indenture is qualified under the 1939 Act.
(c) Each Agent shall have received from Brown & Wood LLP, counsel for
the Agents, or other counsel satisfactory to each Agent, such opinion or
opinions, dated the date hereof, with respect to matters set forth in
clauses (i), (x), (xii), and (xvii) of subparagraph (b) of this Section 5,
and to the effect that:
(i) Assuming that the execution and delivery by the Company of this
Agreement have been duly authorized by all necessary corporate action on
the part of the Company, this
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<PAGE> 13
Agreement (including the Terms Agreement, if applicable) constitutes the
legal, valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms, except insofar as
enforceability of the indemnification and contribution provisions hereof
may be limited under applicable federal or state securities laws and
except as enforceability hereof may be limited by bankruptcy,
insolvency, reorganization or other laws relating to or affecting
creditors' rights generally or by general principles of equity
(regardless of whether such enforceability is considered in a proceeding
in equity or at law).
(ii) Assuming that the execution and delivery by the Company of the
Indenture have been duly authorized by all necessary corporate action on
the part of the Company, the Indenture constitutes the legal, valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as enforceability thereof may be
limited by bankruptcy, insolvency, reorganization or other laws relating
to or affecting creditors' rights generally or by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(iii) The specimen note attached as Annex A (book-entry/global
note) to the officer's certificate of the Company of even date herewith
delivered to the Trustee in accordance with Sections 103 and 301 of the
Indenture (the "Specimen Note") is in the form and contains the terms
required by the Indenture, and such Note in the form of the Specimen
Note, when such Note has been executed by the Company and authenticated
by the Trustee as specified in the Indenture, will on the date of its
issuance (assuming no change in the facts or in the law and governmental
rules and regulations in either case in existence on the date hereof)
properly evidence the indebtedness represented thereby. Assuming that
the execution and delivery of the Notes have been duly authorized by all
necessary corporate action on the part of the Company, when each Note
has been executed by the Company and authenticated by the Trustee as
specified in the Indenture and delivered against payment of the
consideration therefor determined in accordance with this Agreement (and
the Terms Agreement, if applicable), it will be on its date of issuance
(assuming no change in the facts or in the law and governmental rules
and regulations in either case in existence on the date hereof) a legal,
valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, and will be entitled to the
benefit of the Indenture, subject only to the exceptions stated in
clause (ii) above.
In giving such opinion, Brown & Wood LLP may rely as to matters of
Louisiana law upon the opinion of Gordon, Arata, McCollam & Duplantis,
L.L.P., or such other satisfactory counsel, as referred to above.
(d) In giving their opinions required by subsections (b) and (c) of
this Section 5, each such counsel shall additionally state that nothing has
come to their attention that would lead them to believe that (a) the
Registration Statement, at the time it became effective, and if an
amendment to the Registration Statement or an Annual Report on Form 10-K
has been filed by the Company with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time such
amendment became effective or at the time of the most recent such filing
(other than (i) the financial statements and schedules, including the notes
thereto, the auditors' report thereon and the related summary of accounting
policies, contained or incorporated by reference therein, (ii) the other
financial and statistical information contained or incorporated by
reference therein, and (iii) the exhibits thereto, as to which no statement
need be made) contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading or (b) the Prospectus, as amended or
supplemented at the date hereof, or (if such opinion is being delivered in
connection with a Terms Agreement pursuant to Section 6(b) hereof) at the
date of any Terms Agreement and at the Closing Date with respect thereto,
as the case may be (other than (i) the financial statements and schedules,
including the notes thereto, the
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<PAGE> 14
auditors' report thereon and the related summary of accounting policies,
contained or incorporated by reference therein and (ii) the other financial
and statistical information contained or incorporated by reference therein,
as to which no statement need be made), contains an untrue statement of a
material fact or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
(e) At the date hereof and at each Closing Date with respect to any
Terms Agreement, there shall not have been, since the respective dates as
of which information is given in the Registration Statement and the
Prospectus or since the date of such Terms Agreement, any material adverse
change in the condition, financial or otherwise, of the Company, or in the
earnings, business affairs or business prospects of the Company, whether or
not arising in the ordinary course of business; and the Agents shall have
received a certificate of the President, the Vice President serving as the
Chief Financial Officer of the Company, or the Treasurer of the Company to
the effect (i) that there has been no such material adverse change, (ii)
that the other representations and warranties of the Company contained in
Section 1 are true and correct with the same force and effect as though
expressly made at and as of the date of such certificate, (iii) that the
Company has complied with all agreements and satisfied all conditions
pursuant to this Agreement on its part to be performed or satisfied at or
prior to the date of such certificate, and (iv) that no stop order
suspending the effectiveness of the Registration Statement has been issued
and, to the best of his knowledge, no proceedings for that purpose have
been initiated or threatened by the Commission.
(f) On the date hereof, the Agents shall have received a letter from
its independent accountants dated as of the date hereof and in form and
substance satisfactory to the Agents, to the effect that:
(i) they are independent public accountants as required by the 1933
Act and the 1933 Act Regulations;
(ii) that, in their opinion, the financial statements and
supporting schedules examined by them and incorporated by reference in
the Registration Statement and covered by their opinion in the Company's
most recent Annual Report on Form 10-K comply as to form in all material
respects with the applicable accounting requirements of the 1934 Act and
the 1934 Act Regulations;
(iii) that on the basis of a reading of the latest available
unaudited interim financial statements prepared by the Company, a
reading of all minutes of meetings of the shareholders, the Board of
Directors and the Executive and Audit Committees of the Board of
Directors of the Company, discussions with officers of the Company
responsible for financial and accounting matters, and other specified
procedures described in such letter, nothing came to their attention
which caused them to believe that (A) as of the date of the latest
available unaudited interim financial statements prepared by the
Company, there was any change in the capital stock or long-term debt of
the Company, except for (I) the issuance of Common Stock of the Company
pursuant to the Company's 1981 Incentive Stock Option Plan or its 1990
Long-Term Incentive Compensation Plan, (II) any subsequent redemption,
purchase, conversion and cancellation of shares of the Company's
preferred stock pursuant to sinking fund, purchase fund or ESOP
provisions relating to such preferred stock and (III) any maturities of
the Company's first mortgage bonds and notes and purchases thereof by
the Company to meet sinking fund provisions relating thereto, or any
decrease in its net assets, in each case as compared with amounts shown
in the most recent balance sheet information contained in or
incorporated by reference in the Registration Statement, or (B) for the
twelve-month period ending on the date of the latest available unaudited
interim financial statements prepared by the Company there was any
decrease, as compared with the twelve-month period ended the last day of
the Company's
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<PAGE> 15
last fiscal year in operating revenues, operating income, income before
interest charges, net income, net income applicable to common stock or
net income per average common share, except in all instances for changes
or decreases which the Registration Statement discloses have occurred or
may occur;
(iv) that on the basis of inquiries of officers or the Company
responsible for financial and accounting matters and a reading of the
minutes as described above, nothing has come to their attention which
caused them to believe that (A) at a specified date not more than five
business days prior to the date of such letter there was any change in
the capital stock or long-term debt of the Company or any decrease in
its net assets as compared with the amounts shown in the latest
available unaudited financial statements, (B) for the period from the
date of the latest available unaudited financial statements to a
specified date not more than five business days prior to the date of
such letter there was any decrease as compared with the corresponding
period in the preceding year in operating revenues, or (C) for a period
of twelve months ended on a specific date not more than five business
days prior to the date of such letter there was any decrease as compared
with the corresponding period of the preceding year in operating
revenues, operating income, income before interest charges, net income,
net income applicable to common stock or net income per average common
share, except in all instances for changes or decreases which the
Registration Statement discloses have occurred or may occur and except
for (I) the issuance of common stock of the Company pursuant to the
Company's 1981 Incentive Stock Option Plan or its 1990 Long-Term
Incentive Compensation Plan, (II) any subsequent redemption, purchase,
conversion and cancellation of shares of the Company's preferred stock
pursuant to sinking fund, purchase fund or ESOP provisions relating to
such preferred stock and (III) any maturities of the Company's first
mortgage bonds and notes and purchases thereof by the Company to meet
sinking fund provisions relating thereto;
(v) that the ratios of earnings to fixed charges set forth in the
Prospectus under the caption "Selected Financial Information" (and in
any supplement to the Prospectus under the caption "Selected Financial
Information: Additional Information", if applicable) are arithmetically
correct and that the computation of said ratios complies as to form in
all material respects with the 1933 Act Regulations; and
(vi) the results of carrying out specified procedures, described in
such letter, performed for the purpose of comparing specified financial
information (which is limited to financial information derived from
general accounting records of the Company) set forth in certain sections
of the Registration Statement or incorporated therein by reference with
the financial statements or accounting records of the Company, excluding
any questions of legal interpretation.
(g) Other Documents. On the date hereof and on each Closing Date with
respect to any applicable Terms Agreement, counsel to the Agents shall have
been furnished with such documents and opinions as such counsel may
reasonably require for the purpose of enabling such counsel to pass upon
the issuance and sale of Notes as herein contemplated and related
proceedings, or in order to evidence the accuracy and completeness of any
of the representations and warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of Notes as herein contemplated shall
be satisfactory in form and substance in the reasonable judgment of the
Agents and to counsel to the Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by any of
the Agents as to itself and any Terms Agreement may be terminated by the
Purchaser or Purchasers party thereto by notice to the Company at any time and
any such termination shall be without liability of any party to any other party,
except that the covenant set forth in Section 4(d) hereof, the provisions of
Sec-
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<PAGE> 16
tion 4(h) hereof, the indemnity and contribution agreement set forth in Section
8 hereof, and the provisions of Sections 10 and 13 hereof shall remain in
effect.
6. Conditions to the Obligations of the Purchaser. The obligations of the
Purchaser to purchase any Notes will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
of the related Terms Agreement and as of the Closing Date for such Notes, to the
performance and observances by the Company of all covenants and agreements
herein contained on its part to be performed and observed and to the following
additional conditions precedent:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
(b) To the extent agreed to in writing between the Company and the
Purchaser in a Terms Agreement, the Purchaser shall have received,
appropriately updated, (i) a certificate of the Company, dated as of the
Closing Date, to the effect set forth in Section 5(e) (except that
references to the Prospectus shall be to the Prospectus as supplemented as
of the date of such Terms Agreement), (ii) the opinion of Gordon, Arata,
McCollam & Duplantis, L.L.P. counsel for the Company, or other counsel
satisfactory to each Agent, dated as of the Closing Date, to the effect set
forth in Section 5(b), or in lieu of such opinion, Gordon, Arata, McCollam
& Duplantis, L.L.P. or other counsel satisfactory to each of you may
furnish each of you with a letter, dated as of the Closing Date,
authorizing reliance to the effect set forth in Section 5(b) hereof, (iii)
the opinion of Brown & Wood LLP, counsel for the Purchaser, or other
counsel satisfactory to the Purchaser, dated as of the Closing Date, to the
effect set forth in Section 5(c), and (iv) the letter of the independent
accountants for the Company, dated as of the Closing Date, to the effect
set forth in Section 5(f).
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement and an
applicable Terms Agreement, or if any of the opinions and certificates mentioned
above or elsewhere in this Agreement or such Terms Agreement and required to be
delivered to the Purchaser pursuant to the terms hereof and thereof shall not be
in all material respects reasonably satisfactory in form and substance to the
Purchaser and its counsel, such Terms Agreement and all obligations of the
Purchaser thereunder and with respect to the Notes subject thereto may be
canceled at, or at any time prior to, the respective Closing Date by the
Purchaser. Notice of such cancellation shall be effective when given to the
Company in writing by mail or facsimile transmission or by telephone confirmed
in writing.
7. Right of Person Who Agreed to Purchase to Refuse to Purchase. The
Company agrees that any person who has agreed to purchase and pay for any Note
pursuant to a solicitation by any of the Agents shall have the right to refuse
to purchase such Note if, at the Closing Date therefor, any condition set forth
in Section 5 or 6, as applicable, shall not be satisfied.
8. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each of you, the directors, officers, employees and agents of
each of you and each person who controls each of you within the meaning of
either the 1933 Act or the 1934 Act against any and all losses, claims, damages
or liabilities, joint or several, to which you, they or any of you or them may
become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement as originally filed or in any
amendment thereof, or in the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of the Prospectus or any
supplement thereto, in light of the circumstances under which such statement was
made) not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or
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<PAGE> 17
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by any of you specifically for inclusion therein or in reliance upon
the Form T-1. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(b) Each of you agrees to indemnify and hold harmless the Company, each of
its directors, each of its officers who signs the Registration Statement and
each person, if any, who controls the Company within the meaning of either the
1933 Act or the 1934 Act, to the same extent as the foregoing indemnity from the
Company to you, but only with reference to written information relating to such
of you furnished to the Company by or on behalf of such of you specifically for
inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which you may otherwise
have. The Company acknowledges that the statements set forth in the last
paragraph of the cover page, and under the heading "Plan of Distribution", of
the Prospectus constitute the only information furnished in writing by any of
you for inclusion in the documents referred to in the foregoing indemnity, and
you confirm that such statements are correct.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent the
indemnifying party did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory in the reasonable
judgment of the indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including
local counsel), and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. In no event shall the
indemnifying parties be liable for the fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. An indemnifying party will not, without
the prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
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<PAGE> 18
(d) In the event that the indemnity provided in paragraph (a) or (b) of
this Section 8 is held unenforceable or is unavailable to or insufficient to
hold harmless an indemnified party for any reason, the Company and each of you
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the Company
and one or more of you may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company and by each of you from
the offering of the Notes from which such Losses arise; provided, however, that
in no case shall any of you be responsible for any amount in excess of the
commissions received by such of you in connection with the Notes from which such
Losses arise (or, in the case of Notes sold pursuant to a Terms Agreement, the
aggregate commissions that would have been received by such of you if such
commissions had been payable). If the allocation provided by the immediately
preceding sentence is unavailable for any reason, the Company and each of you
shall contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and of each of you
in connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the offering
(before deducting expenses) of the Notes from which such Losses arise, and
benefits received by each of you shall be deemed to be equal to the total
commissions received by such of you in connection with the Notes from which such
Losses arise (or, in the case of Notes sold pursuant to a Terms Agreement, the
aggregate commissions that would have been received by such of you if such
commissions had been payable). Relative fault shall be determined by reference
to whether any alleged untrue statement or omission relates to information
provided by the Company or any of you. The Company and each of you agree that it
would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For purposes
of this Section 8, each person who controls any of you within the meaning of the
1933 Act or the 1934 Act and each director, officer, employee and agent of any
of you shall have the same rights to contribution as you and each person who
controls the Company within the meaning of either the 1933 Act or the 1934 Act,
each officer of the Company who shall have signed the Registration Statement,
each director of the Company and each person, if any, who controls the Company
shall have the same rights to contribution as the Company, subject in each case
to the applicable terms and conditions of this paragraph (d).
9. Termination; Amendment. (a) This Agreement will continue in effect until
terminated as provided in this Section 9. This Agreement may be terminated by
either the Company as to any of you or any of you insofar as this Agreement
relates to such of you, by giving written notice of such termination to such of
you or the Company, as the case may be. This Agreement shall so terminate at the
close of business on the first business day following the receipt of such notice
by the party to whom such notice is given. In the event of such termination, no
party so terminated shall have any liability to any other party so terminated,
except as provided in the fourth paragraph of Section 2(a), Section 4(d),
Section 4(h), Section 8, Section 10 and Section 13. This Agreement may be
amended by the written agreement of the parties hereto.
(b) Each Terms Agreement (whether oral or written) shall be subject to
termination by the Purchaser, by notice given to the Company prior to delivery
of any payment for any Note to be purchased thereunder, if prior to such time
(i) there shall have occurred, subsequent to the agreement to purchase such
Note, any material adverse change, or any change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company, whether or not arising in the ordinary course of business, (ii) there
shall have been, subsequent to the agreement to purchase such Note, any decrease
in the rating of any of the Company's debt securities by any "nationally
recognized statistical rating organization" (as defined for purposes of Rule
436(g) under the 1933 Act) or any notice publicly given of any intended or
potential decrease
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<PAGE> 19
in any such rating or of a possible change in any such rating that does not
indicate the direction of the possible change, (iii) trading in the Company's
common stock shall have been suspended by the Commission or a national
securities exchange or trading in securities generally on the New York Stock
Exchange, the American Stock Exchange or the Pacific Stock Exchange shall have
been suspended or minimum prices shall have been established on either of such
Exchanges, (iv) a banking moratorium shall have been declared either by Federal
or Louisiana or New York State authorities, or (v) there shall have occurred any
outbreak or material escalation of hostilities, declaration by the United States
of a national emergency or war or other calamity or crisis the effect of which
on financial markets is such as to make it, in the reasonable judgment of the
Purchaser, impracticable to proceed with the offering or delivery of such Notes
as contemplated by the Prospectus (exclusive of any supplement thereto).
10. Survival of Certain Provisions. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of each of you set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or
on behalf of any of you or the Company or any of the directors, officers,
employees, agents or controlling persons referred to in Section 8 hereof, and
will survive delivery of and payment for the Notes. The provisions of Sections
4(d), 4(h), 8 and 13 hereof and this Section 10 shall survive the termination or
cancellation of this Agreement. The provisions of this Agreement applicable to
any purchase of a Note for which an agreement to purchase exists prior to the
termination hereof shall survive any termination of this Agreement. If at the
time of termination of this Agreement any Purchaser shall own any Notes with the
intention of selling them, the provisions of Section 4 shall remain in effect
until such Notes are resold.
11. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to any of you, will be mailed, delivered,
transmitted via facsimile or telegraphed and confirmed to such of you, at the
address specified in Schedule I hereto; or, if sent to the Company, will be
mailed, delivered, transmitted via facsimile or telegraphed and confirmed to it
at the address specified in Schedule I hereto.
12. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto, their respective successors, the directors, officers,
employees, agents and controlling persons referred to in Section 8 hereof and no
other person will have any right or obligation hereunder.
13. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and each of you.
Very truly yours,
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
By:
-----------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date hereof.
Salomon Brothers Inc
By:
--------------------------------
Name:
Title:
Merrill Lynch, Pierce, Fenner &
Smith Incorporated
By:
--------------------------------
Name:
Title:
Smith Barney Inc.
By:
--------------------------------
Name:
Title:
First Chicago Capital Markets, Inc.
By:
--------------------------------
Name:
Title:
20
<PAGE> 21
SCHEDULE I
COMMISSIONS:
The Company agrees to pay each Agent a commission equal to the following
percentage of the principal amount of each Note sold on an agency basis by such
Agent:
<TABLE>
<CAPTION>
TERM COMMISSION RATE
---- ---------------
<S> <C>
From 1 year but less than 18 months................................. .125%
From 18 months but less than 2 years................................ .150%
From 2 years but less than 3 years.................................. .200%
From 3 years but less than 4 years.................................. .250%
From 4 years but less than 5 years.................................. .350%
From 5 years but less than 6 years.................................. .450%
From 6 years but less than 7 years.................................. .500%
From 7 years but less than 8 years.................................. .550%
From 8 years but less than 9 years.................................. .600%
From 9 years but less than 10 years................................. .600%
From 10 years but less than 15 years................................ .625%
From 15 years but less than 20 years................................ .700%
From 20 years to 30 years........................................... .750%
In excess of 30 years............................................... *
</TABLE>
- ---------------
* To be negotiated at the time of sale.
Unless otherwise specified in the applicable Terms Agreement, the discount
or commission payable to a Purchaser shall be determined on the basis of the
commission schedule set forth above.
ADDRESS FOR NOTICE TO YOU:
Notices to Central Louisiana Electric Company, Inc. shall be directed to it
at 2030 Donahue Ferry Road, Pineville, LA 71360, Attention of Director,
Financing and Cash Management.
Notices to Salomon Brothers Inc shall be directed to it at Seven World
Trade Center, New York, New York 10048, Attention of the Medium-Term Note
Department.
Notices to Merrill Lynch, Pierce, Fenner & Smith Incorporated shall be
directed to it at World Financial Center, North Tower, New York, NY 10291-1311,
Attention of the Medium-Term Note Department.
Notices to Smith Barney Inc. shall be directed to it at 380 Greenwich
Street, Fourth Floor, New York, New York 10013, Attention of Medium-Term Note
Product Management/Origination -- Mark Meyer.
Notices to First Chicago Capital Markets, Inc. shall be directed to it at
One First National Plaza, 8th Floor, Suite 0995, Chicago, Illinois 60670,
Attention of Medium-Term Note Administrator.
21
<PAGE> 22
EXHIBIT A
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
MEDIUM TERM NOTES
DUE MORE THAN ONE YEAR FROM DATE OF ISSUE
TERMS AGREEMENT
, 199
ATTENTION:
Subject in all respects to the terms and conditions of the Selling Agency
Agreement (the "Agency Agreement") dated December , 1996, among Salomon
Brothers Inc, Merrill Lynch & Co., Smith Barney Inc., First Chicago Capital
Markets, Inc. and you, the undersigned agrees to purchase the following Notes of
Central Louisiana Electric Company, Inc.
<TABLE>
<S> <C>
Aggregate Principal Amount: $
Interest Rate:
Date of Maturity:
Interest Payment Dates:
Regular Record Dates:
Discount or Commission: % of Principal Amount
Purchase Price: % of Principal Amount [plus accrued interest
from 199 ]
Purchase Date and Time:
Place for Delivery of Notes and Payment
Therefor:
Method of Payment:
Modification, if any, in the requirements to
deliver the documents specified in Section
6(b) of the Agency Agreement:
Period during which additional Notes may not
be sold pursuant to Section 4(m) of the
Agency Agreement:
Redemption Provision (if any):
</TABLE>
[Purchaser]
By
-----------------------------
Accepted:
By
-----------------------------
22
<PAGE> 1
EXHIBIT 23(C)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement
of Central Louisiana Electric Company, Inc. on Form S-3 (File No. 333-02895) of
our reports dated January 26, 1996, on our audits of the consolidated financial
statements and financial statement schedule of Central Louisiana Electric
Company, Inc. as of December 31, 1995 and 1994, and for the years ended December
31, 1995, 1994 and 1993, which reports are incorporated by reference or included
in the 1995 Annual Report on Form 10-K. We also consent to the reference to our
firm under the caption "Experts."
/s/ COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
December 9, 1996
<PAGE> 1
EXHIBIT 24
CENTRAL LOUISIANA ELECTRIC COMPANY, INC.
POWER OF ATTORNEY
WHEREAS, Central Louisiana Electric Company, Inc., a Louisiana corporation
(the "Company"), intends to file with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the "Act"), a
Registration Statement on Form S-3 (the "Registration Statement"), including a
Prospectus and exhibits thereto, with any amendment or amendments (including
post-effective amendments) and any supplement or supplements thereto, as
prescribed by the Commission pursuant to the Act and the rules and regulations
of the Commission promulgated thereunder, in connection with the registration of
certain medium term notes of the company to be issued under an Indenture dated
as of October 1, 1988 between the Company and Bankers Trust Company, as Trustee,
or any successor Trustee thereto;
NOW, THEREFORE, the undersigned, in his capacity as a director or officer,
or both, as the case may be, does hereby appoint Gregory L. Nesbitt and Michael
P. Prudhomme, and each of them severally, his true and lawful attorneys-in-fact
or attorney-in-fact with power to act with or without the others and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in any and all capacities, the Registration Statement, including a
Prospectus and exhibits thereto, and any amendment or amendments thereto
(including post-effective amendments) and any supplement or supplements thereto,
as said attorneys-in-fact or any of them shall deem necessary or appropriate,
together with all documents necessary or incidental in connection therewith, to
file the same or cause the same to be filed with the Commission and to appear
before the Commission in connection with any matter relating thereto. Each of
said attorneys-in-fact shall have full power and authority to do and perform in
the name and on behalf of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises as fully and to all
intents and purposes as the undersigned might or could do in person, the
undersigned hereby ratifying and confirming the acts that said attorneys-in-fact
and each of them, or their or his substitutes or substitute, may lawfully do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of attorney as
of the 3rd day of December, 1996.
/s/ WILLIAM H. WALKER, JR.
------------------------------------
William H. Walker, Jr.
<PAGE> 1
EXHIBIT 99
LOUISIANA PUBLIC SERVICE COMMISSION
SPECIAL ORDER
19-96
In re: CLECO's application to sell $200 million in medium term notes.
(Decided at Open Session held on November 13, 1996)
This matter came before the Commission on CLECO's application for authority
to sell $200 million in medium term notes. According to CLECO's application,
proceeds from the sale of these medium term notes will be mainly used in order
to refinance their series Y bonds which carry an interest rate of 9.625%, along
with other long term debts. In their application, CLECO proposes they will also
use part of the issuance for construction and acquisition of plant and related
facilities and to reduce short term debt. Following debate, on Motion of
Commissioner Sittig, seconded by Commissioner Brupbacher and unanimously
adopted, the Commission voted to grant the requested application on condition
that the medium term notes be limited to an interest rate of no higher than nine
percent (9%), with the further requirement that CLECO will need to keep the
Commission informed as to the retirement of their high cost debts.
This Order shall be effective upon its issuance.
IT IS SO ORDERED,
BY ORDER OF THE COMMISSION
BATON ROUGE, LOUISIANA
DECEMBER 4, 1996
/s/ JOHN F. SCHWEGMANN
------------------------------------
DISTRICT I
CHAIRMAN JOHN F. SCHWEGMANN
/s/ IRMA MUSE DIXON
------------------------------------
DISTRICT III
VICE CHAIRMAN IRMA MUSE DIXON
/s/ C. DALE SITTIG
------------------------------------
DISTRICT IV
COMMISSIONER C. DALE SITTIG
/s/ DON OWEN
------------------------------------
DISTRICT V
COMMISSIONER DON OWEN
/s/ ROSS A. BRUPBACHER
------------------------------------
DISTRICT II
COMMISSIONER ROSS A. BRUPBACHER
/s/ LAWRENCE C. ST. BLANC
- ----------------------------------
SECRETARY
