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File No. 70-7572
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 2 (POST-EFFECTIVE) TO
FORM U-1 APPLICATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
_____________________________________________________
CENTRAL POWER AND LIGHT COMPANY
539 N. Carancahua Street
Corpus Christi, Texas 78401-2431
(Name of company filing this statement and
address of principal executive office)
_____________________________________________________
CENTRAL AND SOUTH WEST CORPORATION
(Name of top registered holding company parent)
_____________________________________________________
Melanie J. Richardson
Vice President of Administration
Central Power and Light Company
539 N. Carancahua Street
Corpus Christi, Texas 78401-2431
Stephen J. McDonnell
Treasurer
Central and South West Corporation
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
Joris M. Hogan
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
(Names and addresses of agents for service)
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Central Power and Light Company, a Texas corporation ("CPL") and an
electric utility subsidiary of Central and South West Corporation ("CSW"), a
registered holding company under the Public Utility Holding Company Act of
1935, as amended (the "Act"), hereby requests authority to lease to a
nonaffiliated third party excess space in the headquarters office building
owned by CPL in Corpus Christi, Texas. Such request is being made by the
filing of this Amendment No. 2 (Post-Effective) to Form U-1 Application, File
No. 70-7572, to amend and restate said Application as follows:
Item 1. Description of Proposed Transaction.
By order dated April 13, 1989 (HCAR No. 24863), the Securities and
Exchange Commission (the "Commission") authorized CPL to lease to
nonaffiliated third parties (i) approximately 23,400 square feet of excess
space on the first two floors (built for commercial and retail uses) of its
corporate headquarters building, located at 539 N. Carancahua Street, Corpus
Christi, Texas (the "Headquarters Building"), (ii) approximately 17,800 square
feet of excess space on the third and fourth floors, in the basement and on
the roof of the Headquarters Building and (iii) space in one of its former
office buildings pending eventual sale of the building.
CPL now proposes to lease to Enron Oil & Gas Company, a
nonaffiliated third party ("Enron"), approximately 34,954 square feet of space
on the eighth, tenth and eleventh floors of the Headquarters Building. CPL
has undertaken to use reasonable efforts to substitute a like amount of space
on the ninth floor for the 2,406 square feet of space on the eleventh floor
that is initially to be leased to Enron (the "Swing Space"). Such space to
be leased on the eighth, ninth, tenth and eleventh floors (including the Swing
Space) is referred to as the "Subject Space". CPL has entered into a Lease
Agreement, dated September 16, 1994, with Enron providing for such lease, as
supplemented by a letter, dated September 22, 1994, from CPL to Enron (the
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"Lease"). The obligations of CPL under the Lease are subject to and
conditioned upon receipt by CPL of all required governmental and regulatory
approvals, including the authorization of the Commission requested hereby.
The term of the lease is for five years, commencing on November 1, 1994 and
ending on October 31, 1999, unless certain improvements to the Subject Space
have not been completed or all required governmental and regulatory approvals
have not been received by November 1, 1994. In the case of such a delay, the
term of the lease will commence when such improvements have been completed or
such approvals have been obtained and will end five years thereafter.
The rental payments due under the Lease are $30,584.75 per month,
equivalent to an annual rental rate of $10.50 per square foot of "net rentable
area" as defined in the Lease. The rental payments are subject to increase in
accordance with increases in a specified Consumer Price Index and to other
customary adjustments. The Lease also provides for a grant by CPL to Enron of
a "tenant finish allowance" of $325,072.20 or $9.30 per square foot of net
rentable area for the purpose of constructing improvements to the Subject
Space. This allowance is payable as work on improvements to the Subject Space
is performed and, to the extent not expended on improvements, shall be
credited to rent due under the Lease. Under the Lease, CPL is to pay a
brokerage fee to Enron Property Company, an affiliate of Enron, of $73,403.40
or 4% of the gross rental due over the term of the Lease. Such fee is payable
within ten days after the date the Lease becomes effective. The Lease shall
become effective on the date on which all necessary governmental and
regulatory approvals, including the authority requested hereby, have been
received. CPL believes that the rental payments, the tenant finish allowance
and the brokerage fee provided for in the Lease, taken together, will result
in net rental payments that are at or near market rates for space comparable
to the Subject Space.
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CPL has also agreed to give Enron a right of first refusal to lease
any additional space on the ninth floor or eleventh floor of the Headquarters
Building that might become available for lease during the term of the Lease.
Such provisions as to additional space are in addition to and independent of
the provisions governing the Swing Space. Any lease of such additional space
would be for the remaining unexpired term of the Lease, at an annual rental
rate per square foot equal to the rate to be paid under the Lease. The lease
would also provide for a tenant finish allowance per square foot equal to the
allowance to be paid under the Lease, but proportionately reduced to reflect
the portion of the term of the Lease that will have then expired. In all
other respects, the lease of such additional space would be on the same terms
and conditions as are contained in the Lease. The Lease contains other terms
relating to the Subject Space, such as the provision of building and utility
services, parking spaces and a meeting room by CPL and the maintenance of
certain insurance coverage by Enron, that CPL believes to be customary for
commercial leases of this nature.
Item 2. Fees, Commissions and Expenses.
Fees and expenses to be paid or incurred in connection with the
proposed transaction are estimated as follows:
Holding Company Act filing fee ................ $ 2,000*
Counsel fees:
Milbank, Tweed, Hadley & McCloy
New York, New York .......................... 4,000
Miscellaneous and incidental
expenses including travel,
telephone and postage ....................... 500
-------
TOTAL $ 6,500
=======
_______________
* Actual amount.
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Item 3. Applicable Statutory Provisions.
Sections 9 and 10 of the Act and Rule 23 under the Act are
applicable to the leasing of excess office space by CPL to nonaffiliated third
parties. To the extent any other sections of the Act or rules thereunder may
be applicable to the proposed transactions, CPL hereby requests appropriate
orders thereunder.
Item 4. Regulatory Approval.
No state regulatory authority and no federal regulatory authority,
other than the Commission under the Act, has jurisdiction over the proposed
transaction.
Item 5. Procedure.
CPL requests that the Commission issue and publish no later than
October 7, 1994, the requisite notice under Rule 23 with respect to the filing
of this Application, such notice to specify a date not later than October 31,
1994, as the date after which an order granting and permitting this
Application to become effective may be entered by the Commission and the
Commission enter not later than November 1, 1994, an appropriate order
granting and permitting this Application to become effective.
No recommended decision by a hearing officer or other responsible
officer of the Commission is necessary or required in this matter. The
Division of Investment Management of the Commission may assist in the
preparation of the Commission's decision in this matter. There should be no
thirty-day waiting period between the issuance and the effective date of any
order issued by the Commission in this matter, and it is respectfully
requested that any such order be made effective immediately upon the entry
thereof.
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Item 6. Exhibits and Financial Statements.
Exhibit 1 - Lease Agreement, dated September 16, 1994, between CPL
and Enron, together with letter, dated September 22,
1994, from CPL to Enron.
Exhibit 2 - Preliminary Opinion of Milbank, Tweed, Hadley & McCloy,
counsel to CPL and CSW.
Exhibit 3 - Proposed Notice of Proceeding.
Exhibit 4 - Financial Statements of CPL and CSW, as of June 30, 1994
(to be filed by amendment).
Exhibit 5 - Final or "Past Tense" opinion of Milbank, Tweed, Hadley
& McCloy, counsel to CPL and CSW (to be filed with
Certificate of Notification).
Item 7. Information as to Environmental Effects.
The proposed transaction does not involve major federal action
having a significant effect on the human environment. To the best of CPL's
knowledge, no federal agency has prepared or is preparing an environmental
impact statement with respect to the proposed transaction.
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S I G N A T U R E
- - - - - - - - -
Pursuant to the requirements of the Public Utility Holding Company
Act of 1935, the undersigned company has duly caused this amendment to be
signed on its behalf by the undersigned thereunto duly authorized.
Dated: September 29, 1994
CENTRAL POWER AND LIGHT COMPANY
By: MELANIE J. RICHARDSON
Melanie J. Richardson
Vice President of Administration
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INDEX OF EXHIBITS
EXHIBIT TRANSMISSION
NUMBER EXHIBITS METHOD
- ------- -------- ------------
1 Lease Agreement, dated September 16, 1994, SE
between Central Power and Light Company
("CPL") and Enron Oil & Gas Company
("Enron"), together with letter dated
September 22, 1994, from CPL to Enron.
2 Preliminary Opinion of Milbank, Tweed, Electronic
Hadley & McCloy, counsel to CPL and
Central and South West Corporation
("CSW").
3 Proposed Notice of Proceeding. Electronic
4 Financial Statements of CPL and CSW, ---
as of June 30, 1994 (to be filed by
amendment).
5 Final or "Past Tense" opinion of Milbank, ---
Tweed, Hadley & McCloy, counsel to CPL
and CSW (to be filed with Certificate of
Notification).
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EXHIBIT 2
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Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
September 29, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Central Power and Light Company
Form U-1 Application
Dear Sirs:
We refer to Amendment No. 2 (Post-Effective) to the Form U-1
Application, File No. 70-7572 (the "Amendment"), under the Public Utility
Holding Company Act of 1935, as amended (the "Act"), filed by Central Power
and Light Company ("CPL"), a Texas corporation and a wholly-owned public
utility subsidiary of Central and South West Corporation, a Delaware
corporation and a registered holding company. The Amendment relates to CPL's
request for authority under the Act to lease excess office space in its
headquarters building at 539 N. Carancahua Street, Corpus Christi, Texas to
Enron Oil & Gas Company ("Enron") pursuant to a Lease Agreement, dated
September 16, 1994, between CPL and Enron, as supplemented by a letter, dated
September 22, 1994, from CPL to Enron, all as more fully described in the
Amendment (the "Lease"). We have acted as special counsel for CPL in
connection with the filing of the Amendment and, as such counsel, we are
familiar with the corporate proceedings taken and to be taken by CPL in
connection with the Lease.
We have examined originals, or copies certified to our
satisfaction, of such corporate records of CPL, certificates of public
officials, certificates of officers and representatives of CPL and other
documents as we have deemed necessary to require as a basis for the opinions
hereinafter expressed. In such examination we have assumed the genuineness of
all signatures and the authenticity of all documents submitted to us as
originals and the conformity with the originals of all documents submitted to
us as copies. As to various questions of fact material to such opinions we
have, when relevant facts were not independently established, relied upon
certificates by officers of CPL and other appropriate persons and statements
contained in the Amendment.
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Based upon the foregoing, and having regard to legal considerations
which we deem relevant, we are of the opinion that, in the event that the
Lease is consummated in accordance with the Amendment, as it may be amended,
and subject to the assumptions and conditions set forth below:
1. All state laws applicable to the Lease will have been complied
with.
2. The Lease will not violate the legal rights of the holders of
any securities issued by CPL or any associate company thereof.
The opinions expressed above are subject to the following
assumptions or conditions:
a. The Lease shall have been duly authorized and approved to
the extent required by state law by the Board of Directors of CPL.
b. The Securities and Exchange Commission shall have duly
entered an appropriate order or orders granting and permitting the
Amendment to become effective.
c. The Lease shall be in accordance with any required
approvals, authorizations, consents, certificates and orders of any
state commission or regulatory authority and all such required
approvals, authorizations, consents, certificates and orders shall
have been obtained and remain in effect.
d. No act or event other than as described herein shall have
occurred subsequent to the date hereof which would change the
opinions expressed above.
e. All legal matters incident to the Lease shall be
satisfactory to us, including the receipt in satisfactory form of
opinions of other counsel qualified to practice in jurisdictions
pertaining to the Lease in which we are not admitted to practice.
We hereby consent to the use of this opinion as an exhibit to the
Amendment.
Very truly yours,
MILBANK, TWEED, HADLEY & MCCLOY
Milbank, Tweed, Hadley & McCloy
GWG/RBW
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EXHIBIT 3
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SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- )
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
October __, 1994
Notice is hereby given that the following filings(s) has/have been
made with the Commission pursuant to provisions of the Act and rules
promulgated thereunder. All interested persons are referred to the
application(s) and/or declaration(s) for complete statements of the proposed
transaction(s) summarized below. The application(s) and/or declaration(s) and
any amendment(s) thereto is/are available for public inspection through the
Commission's Office of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in writing by
October __, 1994, to the Secretary, Securities and Exchange Commission,
Washington, D.C. 20549, and serve a copy on the relevant applicant(s) and/or
declarant(s) at the addresses specified below. Proof of service (by
affidavit, or, in case of an attorney at law, by certificate) should be filed
with the request. Any request for hearing shall identify specifically the
issues of fact or law that are disputed. A person who so requests will be
notified of any hearing, if ordered, and will receive a copy of any notice or
order issued in the matter. After said date, the application(s) and/or
declaration(s), as filed or as amended, may be granted and/or permitted to
become effective.
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Central Power and Light Company (File No. 70-7572)
Central Power and Light Company ("CPL"), 539 N. Carancahua Street,
Corpus Christi, Texas 78401, an electric utility subsidiary of Central and
South West Corporation, a registered holding company under the Public Utility
Holding Company Act of 1935 (the "Act"), has filed an Amendment (Post-
Effective) to an Application with the Commission pursuant to Sections 9 and 10
of the Act and Rule 23 thereunder. CPL has requested authority to lease to
unaffiliated third parties certain excess office space in its headquarters
building in Corpus Christi, Texas.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Jonathan G. Katz
Secretary
