As filed with the Securities and Exchange Commission on
September 21, 1995
Registration No. 33-61189
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________
AMENDMENT NO. 2
to
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
_____________________
System Energy Resources, Inc.
(Exact name of registrant as specified in its charter)
State of Arkansas 72-0752777
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
Echelon One
1340 Echelon Parkway
Jackson, Mississippi 39213
601-368-5000
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
DONALD C. HINTZ WILLIAM J. REGAN, JR.
President and Chief Executive Vice President and Treasurer
Officer System Energy Resources, Inc.
System Energy Resources, Inc. 639 Loyola Avenue
1340 Echelon Parkway New Orleans, Louisiana 70113
Jackson, Mississippi 39213 504-576-4308
601-368-5000
LAURENCE M. HAMRIC, Esq.
DENISE C. REDMANN, Esq.
Entergy Services, Inc.
639 Loyola Avenue
New Orleans, Louisiana 70113
504-576-2272
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
<PAGE>
Subject to Completion,
Dated September 21, 1995
P R O S P E C T U S
$265,000,000
SYSTEM ENERGY RESOURCES, INC.
Debt Securities
_____________________________
System Energy Resources, Inc. ("System Energy" or the
"Company") intends to offer from time to time up to
$265,000,000 aggregate principal amount of unsecured debt
securities (the "Debt Securities") in one or more series, at
prices and upon terms to be determined at the time or times
of sale. For each issue of the Debt Securities (the
"Offered Securities") there will be a Prospectus Supplement
("Prospectus Supplement") accompanying this Prospectus that
will set forth, without limitation and to the extent
applicable, the specific designation, aggregate principal
amount, denomination, maturity, premium, if any, rate of
interest (which may be fixed or variable) or method of
calculation thereof, time of payment of interest, any terms
for redemption, any sinking fund provisions, the initial
public offering price, the names of any underwriters or
agents, the principal amounts, if any, to be purchased by
the underwriters, the compensation of such underwriters or
agents, the amount and proposed use of proceeds to the
Company from the Offered Securities, and any other special
terms of or pertinent information with respect to the
Offered Securities and the Company.
See "Risk Factors" at page 5 for information that should be
considered by prospective investors.
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.
The Debt Securities will be sold through one or more
underwriters, dealers or agents, or directly to one or more
purchasers. The Prospectus Supplement will set forth the
names of the underwriters, dealers or agents, if any, any
applicable commissions or discounts and the net proceeds to
the Company from any such sale of the Offered Securities.
See "Plan of Distribution."
_______________
The date of this Prospectus is ___________________, 1995.
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 THE REGISTRATION OR QUALIFICATION UNDER
THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
_______________
AVAILABLE INFORMATION
System Energy is subject to the informational
requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and in accordance therewith
files reports and other information with the Securities and
Exchange Commission (the "Commission"). Such reports
include information, as of particular dates, concerning the
Company's directors and officers, their remuneration, the
principal holders of the Company's securities and any
material interests of such persons in transactions with the
Company. Such reports and other information filed by the
Company can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street
N.W., Room 1024, Washington, D.C. 20549-1004; and at the
following Regional Offices of the Commission: Chicago
Regional Office, 500 W. Madison Street, Suite 1400, Chicago,
Illinois 60661, and New York Regional Office, 7 World Trade
Center, 13th Floor, New York, New York 10048. Copies of
such material can also be obtained at prescribed rates from
the Public Reference Branch of the Commission at its
principal office at 450 Fifth Street N.W., Washington, D.C.
20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the
Commission pursuant to the Exchange Act are incorporated
herein by reference:
1. The Company's Annual Report on Form 10-K for
the year ended December 31, 1994 ( the "1994 10-K").
2. The Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1995.
3. The Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1995.
In addition, all documents filed by the Company with
the Commission pursuant to Section 13, 14 or 15(d) of the
Exchange Act after the date of this Prospectus and prior to
the termination of this offering shall be deemed to be
incorporated by reference in this Prospectus and to be a
part hereof from the date of filing of such documents (such
documents, and the documents enumerated above, being herein
referred to as "Incorporated Documents," provided, however,
that the documents enumerated above or subsequently filed by
the Company pursuant to Section 13, 14 or 15(d) of the
Exchange Act prior to the filing of the Company's next
Annual Report on Form 10-K with the Commission shall not be
Incorporated Documents or be incorporated by reference in
this Prospectus or be a part hereof from and after any such
filing of an Annual Report on Form 10-K).
Any statement contained in an Incorporated Document
shall be deemed to be modified or superseded for all
purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed
Incorporated Document or in a Prospectus Supplement 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.
The Company hereby undertakes to provide without charge
to each person, including any beneficial owner, to whom a
copy of this Prospectus has been delivered, on the written
or oral request of any such person, a copy of any or all of
the Incorporated Documents, other than exhibits to such
documents, unless such exhibits are specifically
incorporated by reference herein. Requests for such copies
should be directed to Christopher T. Screen, P.O. Box 61000,
New Orleans, La. 70161, telephone: (504) 576-4212.
No person has been authorized to give any information
or to make any representation not contained in this
Prospectus, as supplemented or amended, or with respect to
the Debt Securities, and, if given or made, such information
or representation must not be relied upon as having been
authorized by the Company or any other person. This
Prospectus does not constitute an offer to sell or a
solicitation of any offer to buy any of the securities
offered hereby in any jurisdiction to any person to whom it
is unlawful to make such offer in such jurisdiction.
Neither the delivery of this Prospectus nor any sale
made hereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of
the Company since the date of this Prospectus.
<PAGE>
RISK FACTORS
Prospective purchasers of the Debt Securities
offered hereby should carefully consider the matters set
forth below, as well as the other information contained
in this Prospectus and the Incorporated Documents in
evaluating an investment in the Debt Securities
Risks of Ownership of Nuclear Generating Facilities
The Company is subject to the risks attendant upon the
ownership and operation of Grand Gulf 1 ("Grand Gulf 1"), a
1,250 megawatt nuclear powered generating unit, which is the
Company's principal asset. These include risks arising from
the operation of nuclear facilities and the storage,
handling and disposal of high-level and low-level
radioactive materials, limitations on the amounts and types
of insurance commercially available in respect of losses
that might arise in connection with nuclear operations, and
uncertainties with respect to the technological and
financial aspects of decommissioning nuclear plants at the
end of their licensed lives. The Nuclear Regulatory
Commission (the "NRC") has broad authority under Federal law
to impose licensing and safety-related requirements upon
owners and operators of nuclear generating facilities and,
in the event of non-compliance, has the authority to impose
fines or shut down a unit, or both, depending upon its
assessment of the severity of the situation, until
compliance is achieved. Safety requirements promulgated by
the NRC have, in the past, necessitated substantial capital
expenditures at nuclear plants and additional such
expenditures could be required in the future. In addition,
although the Company has no reason to anticipate a serious
nuclear incident at Grand Gulf 1, if such an incident did
occur, it could have a material but presently undeterminable
adverse effect on the financial position of the Company.
Risks Associated with Unsecured Nature of Debt Securities
The Debt Securities offered hereby will be unsecured
obligations of the Company. For further information with
respect to the Company's secured debt obligations and
contractual arrangements for the benefit of other creditors,
reference is made to "The Company - Contractual Arrangements
for the Benefit of Other Creditors" below.
THE COMPANY
General
The Company's principal executive offices are located
at Echelon One, 1340 Echelon Parkway, Jackson, Mississippi
39213. The Company's telephone number is 601-368-5000. The
Company is a wholly-owned subsidiary of Entergy Corporation
("Entergy"), a registered public utility holding company
under the Public Utility Holding Company Act of 1935, as
amended, which also owns all of the common stock of Arkansas
Power & Light Company ("AP&L"), Gulf States Utilities
Company, Louisiana Power & Light Company ("LP&L"),
Mississippi Power & Light Company ("MP&L") and New Orleans
Public Service Inc. ("NOPSI"). Other subsidiaries of
Entergy include Entergy Services, Inc., a service company,
Entergy Operations, Inc., a nuclear management services
company ("Entergy Operations"), Entergy Power, Inc., a
wholesale power company, and Entergy Enterprises, Inc., a
non-utility company. AP&L, LP&L, MP&L and NOPSI own System
Fuels, Inc., which is responsible for the procurement,
transportation and storage of fuel supplies for their
generating plants.
Nature of the Company's Business
The Company's principal asset consists of a 90%
ownership/leasehold interest in Grand Gulf 1, a 1,250
megawatt nuclear powered electric generating unit near Port
Gibson, Mississippi. The other 10% of Grand Gulf 1 is owned
by South Mississippi Electric Power Association, a wholesale
cooperative in Mississippi. The Company has approximately a
78.5% ownership interest and, pursuant to a sale and
leaseback transaction, an 11.5% leasehold interest in Grand
Gulf 1. The Company sells the capacity and energy from its
90% interest exclusively to four affiliated companies that
are also subsidiaries of Entergy. These sales are made
under the Unit Power Sales Agreement among the Company,
AP&L, LP&L, MP&L and NOPSI (the "Unit Power Sales
Agreement") which has been approved by the Federal Energy
Regulatory Commission ("FERC"). (See "-Source of Revenue"
below.) At June 30, 1995, the Company had utility plant
(net of accumulated depreciation) of $2.7 billion, long-term
debt of $1.4 billion and common shareholder's equity of $874
million.
The Company was formed in 1974 to construct, finance
and own certain base-load generating units for the operating
subsidiaries of Entergy. At that time, the Company
contracted with MP&L for MP&L to act as the Company's agent
for the design, construction, operation and maintenance of
the Grand Gulf Station, a proposed two-unit nuclear-powered
electric generating station having a capacity of 2,500 MW.
Grand Gulf 1 was placed in commercial operation on July 1,
1985. Construction of the proposed second unit of the Grand
Gulf Station ("Grand Gulf 2") was suspended in 1985 and this
unit was canceled and written off in 1989. On July 28,
1986, the Company's name was changed from "Middle South
Energy, Inc." to "System Energy Resources, Inc.," and
effective December 20, 1986, the Company assumed the primary
responsibilities, previously assigned to MP&L, for the
management, operation and maintenance of the Grand Gulf
Station. In 1990, Entergy Operations took over
responsibility for operating Grand Gulf 1.
Source of Revenue
The operating revenues of the Company are derived from
the allocation of the capacity and energy associated with
the Company's 90% share of Grand Gulf 1 pursuant to the Unit
Power Sales Agreement. Under that agreement, the Company
has agreed to sell all of its 90% owned and leased share of
capacity and energy from Grand Gulf 1 to AP&L, LP&L, MP&L
and NOPSI in accordance with specified percentages (AP&L
36%, LP&L 14%, MP&L 33% and NOPSI 17%) as ordered by FERC.
Charges under this agreement are paid in consideration for
the respective entitlements of AP&L, LP&L, MP&L and NOPSI to
receive capacity and energy, and are payable irrespective of
the quantity of energy delivered so long as the unit remains
in commercial operation. The current monthly obligation for
payments from AP&L, LP&L, MP&L and NOPSI to the Company
under the Unit Power Sales Agreement is approximately $49
million.
The financial condition of the Company depends
exclusively upon the receipt of payments from AP&L, LP&L,
MP&L and NOPSI and on the continued commercial operation of
Grand Gulf 1. The Company has no reason to believe that
these companies will not be in a position to meet their
financial obligations to pay for their allocated portions of
Grand Gulf 1 capacity and energy. For information with
respect to AP&L's, LP&L's, MP&L's and NOPSI's other
commitments and contingent obligations, reference is made to
Note 8, "Commitments and Contigencies" of the Notes to the
1994 Financial Statements of each of AP&L, LP&L, MP&L and
NOPSI in its Annual Report on Form 10-K for the year ended
December 31, 1994.
The Unit Power Sales Agreement will remain in effect
until terminated by the parties (such termination being
subject to FERC approval), which the Company expects to
occur upon Grand Gulf 1's retirement from service at the
expiration date of its operating license, which currently is
June 16, 2022, but which the Company currently is seeking to
extend to November 1, 2024. In general, approval by holders
of any of the Company's outstanding indebtedness for
borrowed money would not be required for termination,
amendment or modification of the Unit Power Sales Agreement.
For further information with respect to the Unit Power Sales
Agreement, reference is made to "Certain System Financial
and Support Agreements," under Part 1, Item 1 on page 11 of
the 1994 10-K and to Note 7, "Commitments and Contingencies"
of the Company's Notes to the 1994 Financial Statements on
page 332 of the 1994 10-K.
Contractual Arrangements for the Benefit of Other Creditors
Substantially all of the Company's property is subject
to the lien of the Company's First Mortgage Bond Indenture,
which secured approximately $725,319,000 of outstanding debt
at June 30, 1995. In addition, certain indebtedness for
borrowed money of the Company, including its outstanding
First Mortgage Bonds, is secured by assignments of the
Company's rights under the Capital Funds Agreement, dated as
of June 21, 1974, as amended and supplemented, between the
Company and Entergy (the "Capital Funds Agreement") and
under the Availability Agreement, dated as of June 21, 1974,
as amended, among the Company, AP&L, LP&L, MP&L and NOPSI
(the "Availability Agreement").
Pursuant to the Capital Funds Agreement, Entergy has
agreed to supply to the Company sufficient capital to (1)
maintain the Company's equity capital at an amount equal to
a minimum of 35% of its total capitalization (excluding
short-term debt), and (2) permit the continuation of
commercial operation of Grand Gulf 1 and to pay in full all
indebtedness for borrowed money of the Company when due
under any circumstances.
Pursuant to the Availability Agreement and the
assignments thereof,, AP&L, LP&L, MP&L and NOPSI are
individually obligated to make payments or subordinated
advances to the Company in accordance with stated
percentages (AP&L 17.1%, LP&L 26.9%, MP&L 31.3% and NOPSI
24.7%) in amounts that, when added to amounts received under
the Unit Power Sales Agreement or otherwise, are adequate to
cover all of the Company's (i) operating expenses for the
Grand Gulf Station, including depreciation at a specified
rate and permanent shutdown costs, (ii) interest charges,
and (iii) an amount sufficient to amortize the Company's
investment in Grand Gulf 2 over 27 years. The respective
percentages of payments due by AP&L, LP&L, MP&L and NOPSI
were agreed upon by the parties pursuant to an amendment to
the Availability Agreement in connection with the financing
of the construction costs of Grand Gulf 1. The different
percentages of allocation of capacity and energy from Grand
Gulf 1, and the corresponding payments due by AP&L, LP&L,
MP&L and NOPSI, under the Unit Power Sales Agreement were
ordered by FERC in June 1985 based upon FERC's determination
of these companies' system wide demand responsibilities.
The Availability Agreement provides assurances that the
Company would have available to it adequate cash resources
to cover its operating expenses, interest costs and
depreciation charges and permanent shutdown costs in the
event of a shortfall of funds available to the Company from
sales of capacity and energy under the Unit Power Sales
Agreement and from other sources. These assurances do not
cover or provide for a return on equity. On the other hand,
payments to the Company under the Unit Power Sales Agreement
cover the Company's full cost of service, to the extent
allowed pursuant to FERC ratemaking practices, including a
return on equity. The Availability Agreement by its terms
provides that amounts payable thereunder in respect of Grand
Gulf 1 are payable even if the unit is not in service for
any reason. As discussed above, payments under the Unit
Power Sales Agreement are required to be made so long as
Grand Gulf 1 remains in commercial operation. Since
commercial operation of Grand Gulf 1 began, payments under
the Unit Power Sales Agreement to the Company have exceeded
the amounts payable under the Availability Agreement.
Accordingly, no payments under the Availability Agreement by
AP&L, LP&L, MP&L and NOPSI have ever been required.
The Capital Funds Agreement and the Availability
Agreement may be terminated, amended or modified by mutual
agreement of the parties thereto, and upon obtaining, if
required, the consent of those holders of the Company's
indebtedness then outstanding who have received assignments
of such agreements as described above. The Company's
obligation to pay when due the principal of and premium, if
any, and interest on the Debt Securities will not be secured
by any assets of the Company or by any pledge of the
Company's First Mortgage Bonds, nor by any assignment of the
Company's rights under the Capital Funds Agreement, the
Availability Agreement or the Unit Power Sales Agreement.
Holders of the Debt Securities offered hereby will have no
direct legal recourse against the Company, Entergy or AP&L,
LP&L, MP&L and NOPSI under the terms of the Capital Funds
Agreement, the Availability Agreement or the Unit Power
Sales Agreement. For further information with respect to
these agreements, reference is made to "Certain System
Financial and Support Agreements," under Part 1, Item 1 on
page 11 of the 1994 10-K, and to Note 7, "Commitments and
Contingencies" of the Company's Notes to the 1994 Financial
Statements on page 332 of the 1994 10-K.
The information above relating to the Company does not
purport to be comprehensive and should be read together with
the financial statements and other information contained in
the Incorporated Documents. For further information
concerning Entergy, AP&L, LP&L, MP&L and NOPSI, reference is
made to the information relating to such companies contained
in the Annual Report on Form 10-K for the year ended
December 31, 1994 of Entergy, AP&L, LP&L, MP&L and NOPSI.
<PAGE>
USE OF PROCEEDS
Except as otherwise described in any Prospectus
Supplement, the net proceeds to be received from the
issuance and sale of the Offered Securities are expected to
be applied primarily to the redemption, repurchase,
repayment or retirement of outstanding indebtedness of the
Company. The interest rate and maturity of any indebtedness
to be discharged with the proceeds of any series of the Debt
Securities will be set forth in the applicable Prospectus
Supplement.
RATIO OF EARNINGS TO FIXED CHARGES
Twelve Months Ended
June December 31,
30,
1995 1994 1993 1992 1991 1990
Ratio of Earnings
to Fixed Charges(a) 1.23(b) 1.23(b) 1.87 2.04 1.74 2.10
_______________________
(a) "Earnings," as defined by Commission Regulation S-K,
represent the aggregate of (1) net income, (2) taxes
based on income, (3) investment tax credit adjustments-
net and (4) fixed charges. "Fixed Charges" include
interest (whether expensed or capitalized), related
amortization and interest applicable to rentals charged
to operating expenses.
(b) Earnings for the twelve months ended June 30,, 1995
and December 31, 1994 include a charge of $80.2 million
as a result of the settlement of a long-standing dispute
at the Federal Energy Regulatory Commission (the "FERC
Settlement") involving income tax allocation procedures
of the Company. For further information with respect to
the FERC Settlement, reference is made to Note 2, "Rate
and Regulatory Matters," of the Company's Notes to the
1994 Financial Statements on page 327 of the 1994 10-K.
DESCRIPTION OF DEBT SECURITIES
Set forth below are certain general terms and
provisions of the Debt Securities, which may be issued from
time to time in one or more series. The particular terms of
each series of Offered Securities will be described in a
Prospectus Supplement relating thereto. Accordingly, for a
description of the terms of any particular series, reference
must be made to both the description set forth below and the
Prospectus Supplement relating thereto.
The statements under this heading do not purport to be
complete and are subject to the detailed provisions of an
Indenture to be dated as of September 1, 1995, (the
"Indenture") between the Company and Chemical Bank, as
trustee (the "Trustee"), a copy of which has been filed as
an exhibit to the Registration Statement of which this
Prospectus is a part. References in parentheses below refer
to section numbers in the Indenture and capitalized terms
not otherwise defined herein shall have the respective
meanings ascribed to them in the Indenture.
General
The Debt Securities may be issued in one or more new
series under the Indenture. The Indenture does not contain
any limitation on the principal amount of Debt Securities
which may be issued thereunder. The Debt Securities will be
unsecured obligations of the Company.
Reference is made to the Prospectus Supplement relating
to any particular series of Offered Securities for the
following terms, among others: (1) the title of such Debt
Securities; (2) any limit on the aggregate principal amount
of such Debt Securities or the series of which they are a
part; (3) the date or dates on which the principal of any of
such Debt Securities will be payable; (4) the rate or rates
at which any of such Debt Securities will bear interest, if
any, the date or dates from which any such interest will
accrue, the Interest Payment Dates on which any such
interest will be payable and the Regular Record Date for any
such interest payable on any Interest Payment Date; (5) the
place or places where the principal of and premium, if any,
and interest on any of such Debt Securities will be payable;
(6) the period or periods within which, the price or prices
at which and the terms and conditions on which any of such
Debt Securities may be redeemed, in whole or in part, at the
option of the Company; (7) the obligation, if any, of the
Company to redeem or purchase any of such Debt Securities
pursuant to any sinking fund or analogous provision or at
the option of the Holder thereof, and the period or periods
within which, the price or prices at which and the terms and
conditions on which any of such Debt Securities will be
redeemed or purchased, in whole or in part, pursuant to any
such obligation; (8) the denominations in which any of such
Debt Securities will be issuable if other than denominations
of $1,000 and any integral multiple thereof; (9) if the
amount of principal of or any premium or interest on any of
such Debt Securities will be determined with reference to an
index or pursuant to a formula, the manner in which such
amounts will be determined; (10) if any such Debt Securities
will be issued in global form and, if so, any and all
matters incidental to such Debt Securities,; (11) any
addition to the Events of Default applicable to any of such
Debt Securities; (12) any addition to the covenants of the
Company for the benefit of the Holders of such Debt
Securities in the Indenture; and (13) any other terms of
such Debt Securities not inconsistent with the provisions of
the Indenture. (Section 301).
Form, Exchange and Transfer
Unless otherwise specified in the applicable Prospectus
Supplement, the Debt Securities of each series will be
issuable only in fully registered form without coupons and
in denominations of $1,000 and any integral multiple
thereof. (Sections 201 and 302).
At the option of the Holder, subject to the terms of
the Indenture and the limitations applicable to global
securities, Debt Securities of any series will be
exchangeable for other Debt Securities of the same series,
of any authorized denomination and of like tenor and
aggregate principal amount (Section 305).
Subject to the terms of the Indenture and the
limitations applicable to global securities, Debt Securities
may be presented for exchange as provided above or for
registration of transfer (duly endorsed or accompanied by a
duly executed instrument of transfer) at the office of the
Security Registrar or at the office of any transfer agent
designated by the Company for such purpose. The Company may
designate itself the Security Registrar. No service charge
will be made for any registration of transfer or exchange of
Debt Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith. Such transfer or exchange
will be effected upon the Security Registrar or such
transfer agent, as the case may be, being satisfied with the
documents of title and identity of the person making the
request. (Section 305). Any transfer agent (in addition to
the Security Registrar) initially designated by the Company
for any Debt Securities will be named in the applicable
Prospectus Supplement. The Company may at any time
designate additional transfer agents or rescind the
designation of any transfer agent or approve a change in the
office through which any transfer agent acts, except that
the Company will be required to maintain a transfer agent in
each Place of Payment for the Debt Securities of each
series. (Section 602).
The Company will not be required to (i) issue, register
the transfer of, or exchange any Debt Security or any
Tranche thereof during a period beginning at the opening of
business 15 days before the day of mailing of a notice of
redemption of any such Debt Security called for redemption
and ending at the close of business on the day of such
mailing or (ii) register the transfer of or exchange any
Debt Security so selected for redemption, in whole or in
part, except the unredeemed portion of any such Debt
Security being redeemed in part. (Section 305).
Payment and Paying Agents
Unless otherwise indicated in the applicable Prospectus
Supplement, payment of interest on a Debt Security on any
Interest Payment Date will be made to the person in whose
name such Debt Security (or one or more Predecessor
Securities) is registered at the close of business on the
Regular Record Date for such interest. (Section 307).
Unless otherwise indicated in the applicable Prospectus
Supplement, principal of and any premium and interest on the
Debt Securities of a particular series will be payable at
the office of such Paying Agent or Paying Agents as the
Company may designate for such purpose from time to time.
Unless otherwise indicated in the applicable Prospectus
Supplement, the corporate trust office of the Trustee in New
York City will be designated as the Company's sole Paying
Agent for payments with respect to Debt Securities of each
series. Any other Paying Agents initially designated by the
Company for the Debt Securities of a particular series will
be named in the applicable Prospectus Supplement. The
Company may at any time designate additional Paying Agents
or rescind the designation of any Paying Agent or approve a
change in the office through which any Paying Agent acts,
except that the Company will be required to maintain a
Paying Agent in each Place of Payment for the Debt
Securities of a particular series. (Section 602).
All moneys paid by the Company to a Paying Agent for
the payment of the principal of or any premium or interest
on any Debt Security which remain unclaimed at the end of
two years after such principal, premium or interest has
become due and payable will be repaid to the Company, and
the Holder of such Debt Security thereafter may look only to
the Company for payment thereof. (Section 603).
Redemption
Any terms for the optional or mandatory redemption of
any series of Debt Securities will be set forth in the
applicable Prospectus Supplement. Except as shall otherwise
be provided in the applicable Prospectus Supplement with
respect to Debt Securities that are redeemable at the option
of the Holder, Debt Securities will be redeemable only upon
notice by mail not less than 30 nor more than 60 days' prior
to the date fixed for redemption, and, if less than all the
Debt Securities of a series, or any Tranche thereof, are to
be redeemed, the particular Debt Securities to be redeemed
will be selected by such method as shall be provided for any
particular series, or in the absence of any such provision,
by such method of random selection as the Security Registrar
deems fair and appropriate. (Section 403 and 404).
Any notice of redemption at the option of the Company
may state that such redemption will be conditional upon
receipt by the Paying Agent or Agents, on or prior to the
date fixed for such redemption, of money sufficient to pay
the principal of and premium, if any, and interest, if any,
on such Debt Securities and that if such money has not been
so received, such notice will be of no force and effect and
the Company will not be required to redeem such Debt
Securities (Section 404).
Events of Default
The Indenture defines the occurrence of any one or more
of the following events to be an "Event of Default":
(a) failure to pay any interest on any Debt
Security within sixty (60) days after the same
becomes due and payable;
(b) failure to pay the principal of or premium, if
any, on any Debt Security when due and payable;
(c) failure to perform or breach of any other
covenant or warranty of the Company in the Indenture
(other than a covenant or warranty of the Company in
the Indenture solely for the benefit of one or more
series of Debt Securities other than such series),
for 60 days after written notice to the Company by
the Trustee, or to the Company and the Trustee by
the Holders of at least 33% in principal amount of
the Debt Securities outstanding under the Indenture
as provided in the Indenture;
(d) certain events of bankruptcy, insolvency or
reorganization; or
(e) any other Event of Default specified with
respect to the Debt Securities (Section 801).
No Event of Default with respect to a particular series
of the Debt Securities necessarily constitutes an Event of
Default with respect to any other series of Debt Securities
that may be issued under the Indenture.
Remedies
If an Event of Default occurs and is continuing with
respect to Debt Securities of any series at the time
Outstanding, then either the Trustee or the Holders of not
less than 33% in principal amount of the Outstanding Debt
Securities of such series may declare the principal amount
(or if any of the Debt Securities of such series are
Discount Securities, such portion of the principal amount of
such Debt Securities as may be specified in the applicable
Prospectus Supplement) of all of the Debt Securities of such
series to be due and payable immediately; provided, however,
that if an Event of Default occurs and is continuing with
respect to more than one series of Debt Securities, the
Trustee or the Holders of not less than 33% in aggregate
principal amount of the Outstanding Debt Securities of all
such series, considered as one class, may make such
declaration of acceleration, and not the Holders of the Debt
Securities of any one of such series.
At any time after the declaration of acceleration with
respect to the Debt Securities of any series has been made
and before a judgment or decree for payment of the money due
has been obtained by the Trustee, the Event of Default
giving rise to such declaration of acceleration will,
without further act, be deemed to have been waived, and such
declaration and its consequences will, without further act,
be deemed to have been rescinded and annulled, if:
(a) the Company has paid or deposited with the
Trustee a sum sufficient to pay:
(1) all overdue interest on the Debt Securities
of such series;
(2) the principal of and premium, if any, on the
Debt Securities of such series which have become
due otherwise than by such declaration of
acceleration and interest thereon at the rate or
rates prescribed therefor in such Debt Securities;
(3) interest upon overdue interest at the rate or
rates prescribed therefore in the Debt Securities
of such series, to the extent that payment of such
interest is lawful; and
(4) all amounts due to the Trustee under the
Indenture;
and
(b) any other Event or Events of Default with
respect to the Debt Securities of such series, other
than the nonpayment of the principal of the Debt
Securities of such Series which has become due
solely by such declaration of acceleration, have
been cured or waived as provided in the Indenture
(Section 802).
If an Event of Default occurs and is continuing with
respect to a series of Debt Securities, the Holders of a
majority in principal amount of the Outstanding Debt
Securities of such series will have the right to direct the
time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Debt
Securities of such series; provided, however, that if an
Event of Default occurs and is continuing with respect to
more than one series of Debt Securities issued under the
Indenture, the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of all such
series, considered as one class, will have the right to make
such direction, and not the Holders of the Debt Securities
of any one of such series; and provided, further, that (a)
such direction will not be in conflict with any rule of law
or with the Indenture and will not involve the Trustee in
personal liability in circumstances where reasonable
indemnity would not in the Trustee's sole discretion be
adequate and (b) the Trustee may take any other action it
deems proper which is not inconsistent with such direction
(Section 812).
The Holders of a majority in principal amount of the
then Outstanding Debt Securities of any series may waive any
past default under the Indenture except a default (a) in the
payment of the principal of or premium, if any, or interest,
if any, on any Debt Security of such series or (b) with
respect to a covenant or provision of the Indenture which
under the Indenture cannot be modified or amended without
the consent of the Holder of each Outstanding Debt Security
of such series affected (Section 813).
The right of a Holder of the Debt Securities to
institute a proceeding with respect to the 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, if any, on or after the
applicable due date specified in such Debt Security and to
institute suit for the enforcement of any such payment
(Sections 807 and 808). The Indenture provides that the
Trustee, within 90 days after the occurrence of any default
thereunder with respect to the Debt Securities of any
series, is required to give the Holders of the Debt
Securities of such series notice of such default, unless
cured or waived; provided, however, that, except in the case
of a default in the payment of principal of or premium, if
any, or interest, if any, on the Debt Securities of such
series, the Trustee may withhold such notice if the Trustee
determines that it is in the interest of such Holders to do
so; and provided, further, that in the case of an Event of
Default of the character specified above in clause (c) under
"Events of Default," no such notice shall be given to such
Holders until at least 75 days after the occurrence thereof
(Section 902).
The Company will be required to furnish annually to the
Trustee a statement by an appropriate officer as to such
officer's knowledge of the Company's compliance with all
conditions and covenants under the Indenture, such
compliance to be determined without regard to any period of
grace or requirement of notice under the Indenture (Section
606).
Consolidation, Merger, Conveyance, Transfer or Lease
The Company will not consolidate with or merge into any
other corporation or convey, transfer, or lease its
properties and assets substantially as an entirety to any
Person unless (a) the corporation formed by such
consolidation or into which the Company is merged or the
Person which acquires by conveyance or transfer, or which
leases, the property and assets of the Company substantially
as an entirety, is a Person organized and existing under the
laws of the United States of America, any State thereof or
the District of Columbia, and such Person expressly assumes,
by supplemental indenture, the due and punctual payment of
the principal of and premium, if any, and interest, if any,
on all the Outstanding Debt Securities and the performance
of all of the covenants of the Company under the Indenture,
(b) immediately after giving effect to such transactions, no
Event of Default, and no event which after notice and lapse
of time would become an Event of Default, will have occurred
and be continuing, and (c) the Company will have delivered
to the Trustee an Officer's Certificate and an Opinion of
Counsel as provided in the Indenture (Section 1101).
Unless otherwise indicated in the applicable Prospectus
Supplement, there are no provisions that will afford the
holders of Debt Securities protection in the event of a
highly leveraged transaction involving the Company. There
are also no provisions that will require the repurchase of
the Debt Securities upon a change in control of the Company.
Modification of Indenture
Without the consent of any Holders of Debt Securities,
the Company and the Trustee may enter into one or more
supplemental indentures, in form satisfactory to the
Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to
the Company and the assumption by any such successor
of the covenants of the Company in the Indenture and
the Debt Securities;
(b) to add to the covenants of the Company for the
benefit of the Holders of all or any series of
Outstanding Debt Securities or to surrender any
right or power conferred upon the Company by the
Indenture;
(c) to add any additional Events of Default with
respect to all or any series of outstanding Debt
Securities;
(d) to change or eliminate any provision of the
Indenture or to add any provision to the Indenture;
provided that if such change, elimination or
addition will adversely affect the interests of the
Holders of Debt Securities of any series in any
material respect, such change, elimination or
addition will become effective with respect to such
series only when there is no Debt Security of such
series remaining Outstanding under the Indenture;
(e) to provide collateral security for the Debt
Securities;
(f) to establish the form or terms of Debt
Securities of any series as permitted by the
Indenture;
(g) to provide for the authentication and delivery
of bearer securities and coupons appertaining
thereto representing interest, if any, thereon and
for the registration, exchange and replacement
thereof and for the giving of notice to, and the
solicitation of the vote or consent of, the holders
thereof, and any matters incidental thereto;
(h) to evidence and provide for the acceptance of
appointment of a separate or successor Trustee under
the Indenture with respect to the Debt Securities of
one or more series and to add to or change any of
the provisions of the Indenture as shall be
necessary to provide for or to facilitate the
administration of the trusts under the Indenture by
more than one Trustee;
(i) to provide for the procedures required to
permit the utilization of a noncertificated system
of registration for any series of Debt Securities;
(j) to change any place or places where (1) the
principal of and premium, if any, and interest, if
any, on all or any series of Debt Securities shall
be payable, (2) all or any series of Debt Securities
may be surrendered for registration of transfer, (3)
all or any series of Debt Securities may be
surrendered for exchange, and (4) notices and
demands to or upon the Company in respect of all or
any series of Debt Securities may be served; or
(k) to cure any ambiguity, defect or inconsistency
or to make any other changes to the provisions of
the Indenture with respect to matters and questions
arising under the Indenture, provided such action
shall not adversely affect the interests of the
Holders of Debt Securities of any series in any
material respect (Section 1201).
The consent of the Holders of a majority in aggregate
principal amount of the Debt Securities of all series then
Outstanding under the Indenture, considered as one class, is
required for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions
of, the Indenture pursuant to an indenture or supplemental
indenture; provided, however, that if less than all of the
series of Debt Securities Outstanding under the Indenture
are directly affected by a supplemental indenture, then the
consent only of the Holders of a majority in aggregate
principal amount of the Outstanding Debt Securities of all
series so directly affected, considered as one class, will
be required; and provided, further, that if the Debt
Securities of any series have been issued in more than one
Tranche and if the proposed supplemental indenture directly
affects the rights of the Holders of Debt Securities of one
or more, but less than all, of such Tranches, then the
consent only of the Holders of a majority in aggregate
principal amount of the Outstanding Debt Securities of all
Tranches so directly affected, considered as one class, will
be required; and provided, further, that no such
supplemental indenture will, without the consent of the
Holder of each Outstanding Security under the Indenture of
each such series directly affected thereby, (a) change the
Stated Maturity of, or any installment of principal of or
interest on, any Debt Security, or reduce the principal
thereof or the rate of interest (or the amount of any
installment of interest thereon), if any, thereon or
redemption premium thereon, or change the method of
calculating the rate of interest thereon, or reduce the
amount of the principal of any Discount Security that would
be due and payable upon a declaration of acceleration of the
Maturity thereof, or change the coin or currency (or other
property) in which any Debt Security or any premium or the
interest thereon is payable or impair the right to institute
suit for the enforcement of any such payment on or after the
Stated Maturity of any Debt Security (or, in the case of
redemption, on or after the Redemption Date), (b) reduce the
percentage in principal amount of the Debt Securities
Outstanding under such series, the consent of the Holders of
which is required for any supplemental indenture or waiver
of compliance with any provision of the Indenture or any
default thereunder and its consequences or to reduce the
requirements for quorum and voting under the Indenture, or
(c) modify certain of the provisions of the Indenture
relating to supplemental indentures, waivers of certain
covenants and waivers of past defaults.
A supplemental indenture which changes or eliminates
any covenant or other provision of the Indenture which has
expressly been included solely for the benefit of one or
more particular series of Debt Securities or one or more
Tranches thereof, or which modifies the rights of the
Holders of Debt Securities of such series or Tranches with
respect to such covenant or other provision, shall be deemed
not to affect the rights under the Indenture of the Holders
of Debt Securities of any other series or Tranche (Section
1202).
The Indenture provides that in determining whether the
Holders of the requisite principal amount of the Outstanding
Debt Securities have given any request, demand,
authorization, direction, notice, consent or waiver under
the Indenture or whether a quorum is present at a meeting of
Holders of Debt Securities, (i) Debt Securities owned by the
Company or any other obligor upon the Debt Securities or any
Affiliate of the Company or of such other obligor (unless
the Company, such Affiliate or such obligor owns all
Outstanding Debt Securities under the Indenture, or all
Outstanding Debt Securities of each such series and each
such Tranche, as the case may be, determined without regard
to this clause (i)) shall be disregarded and deemed not to
be Outstanding; (ii) the principal amount of a Discount
Security that shall be deemed to be Outstanding for such
purposes shall be the amount of the principal thereof that
would be due and payable as of the date of such
determination upon a declaration of acceleration of the
Maturity thereof as provided in the Indenture; and (iii) the
principal amount of a Debt Security denominated in one or
more foreign currencies or a composite currency that will be
deemed to be Outstanding will be the amount of Dollars which
could have been purchased by the principal amount (or, in
the case of a Debt Security described in clause (ii) above,
of the amount described in such clause) of such currency or
composite currency evidenced by such Debt Security.
(Section 101).
If the Company shall solicit from Holders any request,
demand, authorization, direction, notice, consent, election,
waiver or other Act, the Company may, at its option, by
Board Resolution, fix in advance a record date for the
determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, election,
waiver or other Act, but the Company shall have no
obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent,
election, waiver or other Act may be given before or after
such record date, but only the Holders of record at the
close of business on the record date shall be deemed to be
Holders for the purposes of (i) determining whether Holders
of the requisite proportion of the Outstanding Debt
Securities have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent,
waiver or other Act and for that purpose the Outstanding
Debt Securities shall be computed as of the record date or
(ii) determining which Holders may revoke any such Act..
Any request, demand, authorization, direction, notice,
consent, election, waiver or other Act of a Holder shall
bind every future Holder of the same Debt Security and the
Holder of every Debt Security issued upon the registration
of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to
be done by the Trustee or the Company in reliance thereon,
whether or not notation of such action is made upon such
Debt Security. (Section 104).
Defeasance
Unless otherwise indicated in the applicable Prospectus
Supplement for a series of Offered Securities, any series of
Debt Securities, or any portion of the principal amount
thereof, will be deemed to have been paid for purposes of
the Indenture (except as to any surviving rights of
registration of transfer or exchange expressly provided for
in the Indenture), and the entire indebtedness of the
Company in respect thereof will be deemed to have been
satisfied and discharged, if there shall have been
irrevocably deposited with the Trustee or any Paying Agent
(other than the Company), in trust: (a) money in an amount
which will be sufficient, or (b) Government Obligations (as
defined below), which do not contain provisions permitting
the redemption or other prepayment thereof at the option of
the issuer thereof, the principal of and the interest on
which when due, without any regard to reinvestment thereof,
will provide moneys which, together with the money, if any,
deposited with or held by the Trustee or such Paying Agent,
will be sufficient, or (c) a combination of (a) and (b)
which will be sufficient, to pay when due the principal of
and premium, if any, and interest, if any, due and to become
due on such Debt Securities of such series or portions
thereof (Section 701). For this purpose, Government
Obligations, include direct obligations of, or obligations
unconditionally guaranteed by, the United States of America
entitled to the benefit of the full faith and credit thereof
and certificates, depositary receipts or other instruments
which evidence a direct ownership interest in such
obligations or in any specific interest or principal
payments due in respect thereof.
While there may be no legal precedent on point, it is
possible that for federal income tax purposes any deposit
contemplated in the preceding paragraph could be treated as
a taxable exchange of the related Debt Securities for an
issue of obligations of the trust or a direct interest in
the cash and securities held in the trust. In that case,
Holders of such Debt Securities would recognize a gain or
loss for federal income tax purposes, as if their share of
the trust obligations or the cash or securities deposited,
as the case may be, had actually been received by them in
exchange for their Debt Securities. In addition, such
Holders thereafter would be required to include in income a
share of the income, gain or loss of the trust. The amount
so required to be included in income could be different from
the amount that would be includable in the absence of such
deposit. Prospective investors are urged to consult their
own tax advisors as to the specific consequences to them of
such deposit.
Resignation of Trustee
The Trustee may resign at any time by giving written
notice thereof to the Company or may be removed at any time
by Act of the Holders of a majority in principal amount of
the then Outstanding Debt Securities delivered to the
Trustee and the Company. No resignation or removal of the
Trustee and no appointment of a successor trustee will
become effective until the acceptance of appointment by a
successor trustee in accordance with the requirements of the
Indenture. So long as no Event of Default or event which,
after notice or lapse of time, or both, would become an
Event of Default has occurred and is continuing and except
with respect to a Trustee appointed by Act of the Holders,
if the Company has delivered to the Trustee a resolution of
its Board of Directors appointing a successor trustee and
such successor has accepted such appointment in accordance
with the terms of the Indenture, the Trustee will be deemed
to have resigned and the successor will be deemed to have
been appointed as trustee in accordance with the Indenture.
(Section 910).
Book-Entry System - Global Debt Securities
Unless otherwise specified in the applicable Prospectus
Supplement. The Depository Trust Company, New York, New
York ("DTC") will act as securities depository for the Debt
Securities. The Debt Securities will be issued only as
fully-registered securities registered in the name of Cede &
Co. (DTC's partnership nominee). One or more fully-
registered global certificates will be issued for the Debt
Securities representing the aggregate principal amount of
such series of Debt Securities, and will be deposited with
DTC.
DTC is a limited-purpose trust company organized under
the 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. DTC holds securities that
its participants (the "Direct Participants") deposit with
DTC. DTC also facilitates the settlement among Direct
Participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic
computerized book-entry changes in Direct Participants'
accounts, thereby eliminating the need for physical movement
of securities certificates. Direct Participants include
securities brokers and dealers, banks, trust companies,
clearing corporations and certain other organizations. DTC
is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange,
Inc., and the National Association of Securities Dealers,
Inc. Access to the DTC system is also available to others
such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial
relationship with a Direct Participant, either directly or
indirectly (the "Indirect Participants," and together with
the Direct Participants, the "Participants"). The rules
applicable to DTC and its Participants are on file with the
Commission.
Purchases of Debt Securities within the DTC system must
be made by or through Direct Participants, which will
receive a credit for the Debt Securities on DTC's records.
The ownership interest of each actual purchaser of each
Debenture (a "Beneficial Owner") is in turn to be recorded
on the Direct and Indirect Participants' respective records.
Beneficial Owners will not receive written confirmation from
DTC of their purchase, but Beneficial Owners are expected to
receive written confirmations providing details of the
transaction, as well as periodic statements of their
holdings, from the Direct or Indirect Participant through
which the Beneficial Owner entered into the transaction.
Transfers of ownership interest in the Debt Securities are
to be accomplished by entries made on the books of
Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing
their ownership interest in Debt Securities except in the
event that use of the book-entry system for the Debt
Securities is discontinued.
To facilitate subsequent transfers, all Debt Securities
deposited by Direct Participants with DTC are registered in
the name of DTC's partnership nominee, Cede & Co. The
deposit of the Debt Securities with DTC and their
registration in the name of Cede & Co. effect no change in
beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the Debt Securities; DTC's records
reflect only the identity of the Direct Participants to
whose accounts such Debt Securities are credited, which may
or may not be the Beneficial Owners. The Participants will
remain responsible for keeping account of their holdings on
behalf of their customers.
Conveyance of notices and other communications by DTC
to Direct Participants, by Direct Participants to Indirect
Participants, and by Direct Participants and Indirect
Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to
time.
Redemption notices shall be sent to Cede & Co. If less
than all of the securities of an issue are being redeemed,
DTC's practice is to determine by lot the amount of the
interest of each Direct Participant in such series to be
redeemed.
Neither DTC nor Cede & Co. will consent or vote with
respect to the Debt Securities. Under its usual procedures,
DTC mails an omnibus proxy (an "Omnibus Proxy") to the
Participants as soon as possible after the record date. The
Omnibus Proxy assigns Cede & Co.'s consenting or voting
rights to those Direct Participants to whose accounts the
Debt Securities are credited on the record date (identified
in a listing attached to the Omnibus Proxy).
Principal, premium, if any, and interest payments on
the Debt Securities will be made to DTC. DTC's practice is
to credit Direct Participants' accounts on the relevant
payment date in accordance with their respective holdings
shown on DTC's records unless DTC has reason to believe that
it will not receive payment on such payment date. Payments
by Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the
case with securities for the accounts of customers in bearer
form or registered in "street-name," and will be the
responsibility of such Participant and not of DTC, the
Underwriters, or the Company, subject to any statutory or
regulatory requirements as may be in effect from time to
time. Payment of principal, redemption premium, if any, and
interest to DTC is the responsibility of the Company or the
Trustee. Disbursement of such payments to Direct
Participants is the responsibility of DTC, and disbursement
of such payments to the Beneficial Owners is the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as
securities depository with respect to the Debt Securities at
any time by giving reasonable notice to the Company. Under
such circumstances and in the event that a successor
securities depository is not obtained, Debt Securities
certificates are required to be printed and delivered. In
addition, the Company may decide to discontinue use of the
system of book-entry transfers through DTC (or a successor
securities depository). In that event, Debt Securities
certificates will be printed and delivered.
The Company will not have any responsibility or
obligation to Participants or the persons for whom they act
as nominees with respect to the accuracy of the records of
DTC, its nominee or any Direct or Indirect Participant with
respect to any ownership interest in the Debt Securities, or
with respect to payments to or providing of notice for the
Direct Participants, the Indirect Participants or the
Beneficial Owners.
So long as Cede & Co. is the registered owner of the
Debt Securities, as nominee of DTC, references herein to
Holders of the Debt Securities shall mean Cede & Co. or DTC
and shall not mean the Beneficial Owners of the Debt
Securities.
The information in this section concerning DTC and
DTC's book-entry system has been obtained from DTC. Neither
the Company, the Trustee nor the underwriters, dealers or
agents takes responsibility for the accuracy or completeness
thereof.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities: (i) through
underwriters or dealers, (ii) directly to one or more
purchasers, (iii) through agents or (iv) through a
combination of any such methods of sale. The applicable
Prospectus Supplement with respect to the Offered Securities
shall set forth the terms of the offering of the Offered
Securities, including the name or names of any underwriters,
dealers or agents, the purchase price of such Offered
Securities and the proceeds to the Company from such sale,
any underwriting discounts and other items constituting
underwriters' compensation, any initial public offering
price and any discounts or concessions allowed or reallowed
or paid by any underwriters to dealers. Any initial public
offering price and any discounts or concessions allowed or
reallowed or paid to dealers by any underwriters may be
changed from time to time.
If underwriters are used in the sale of the Offered
Securities, such Offered Securities will be acquired by the
underwriters for their own account and may be resold from
time to time in one or more transactions, including
negotiated transactions, at a fixed public offering price or
at varying prices determined at the time of sale. The
underwriters with respect to a particular underwritten
offering of Offered Securities will be named in the
applicable Prospectus Supplement relating to such offering
and, if an underwriting syndicate is used, the managing
underwriter or underwriters will be set forth on the cover
page of such Prospectus Supplement. In connection with the
sale of Offered Securities, the underwriters may receive
compensation from the Company or from purchasers in the form
of discounts, concessions or commissions. The underwriters
will be, and any dealers participating in the distribution
of the Offered Securities may be, deemed to be underwriters
within the meaning of the Securities Act of 1933, as
amended. The Company has agreed to indemnify the
underwriters against certain civil liabilities, including
liabilities under the Securities Act of 1933, as amended.
The underwriting agreement pursuant to which any Offered
Securities are to be sold will provide that the obligations
of the underwriters are subject to certain conditions
precedent and that the underwriters will be obligated to
purchase all of the Offered Securities if any are purchased;
provided that the agreement between the Company and the
underwriter providing for the sale of the Offered Securities
may provide that under certain circumstances involving a
default of underwriters that less than all of the Offered
Securities may be purchased.
Offered Securities may be sold directly by the Company
or through agents designated by the Company from time to
time. The applicable Prospectus Supplement shall set forth
the name of any agent involved in the offer or sale of the
Offered Securities in respect of which such Prospectus
Supplement is delivered as well as any commissions payable
by the Company to such agent. Unless otherwise indicated in
the Prospectus Supplement, any such agent will be acting on
a best efforts basis for the period of its appointment.
If so indicated in the applicable Prospectus
Supplement, the Company will authorize agents, underwriters
or dealers to solicit offers by certain specified
institutions to purchase Offered Securities from the Company
at the public offering price set forth in such Prospectus
Supplement pursuant to delayed delivery contracts providing
for payment and delivery on a specified date in the future.
Such contracts will be subject to those conditions set forth
in the applicable Prospectus Supplement, and such Prospectus
Supplement will set forth the commission payable for
solicitation of such contracts.
EXPERTS AND LEGALITY
The Company's balance sheet as of December 31, 1994 and
the statements of income, retained earnings, and cash flows
for the year ended December 31, 1994, incorporated by
reference in this Prospectus, have been incorporated by
reference herein in reliance on the report of Coopers &
Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in accounting and
auditing.
The financial statements as of December 31, 1993 and
for each of the two years in the period ended December 31,
1993, incorporated in this Prospectus by reference to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1994, have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their reports dated
February 11, 1994 (November 30, 1994 as to Note 2, "Rate and
Regulatory Matters-FERC Settlement"), which included an
explanatory paragraph relating to the Company's change in
method of accounting for income taxes, also incorporated by
reference herein.
The legality of the Debt Securities will be passed upon
for the Company by Reid & Priest LLP, New York, New York and
Wise Carter Child & Caraway, Professional Association,
Jackson, Mississippi. Certain legal matters will be passed
upon for any underwriters, dealers or agents by Winthrop,
Stimson, Putnam & Roberts, New York, New York. Matters
pertaining to New York law will be passed upon by Reid &
Priest LLP, New York counsel to the Company; matters
pertaining to Arkansas law will be passed upon by Friday,
Eldredge & Clark, Little Rock, Arkansas, Arkansas counsel to
the Company; and matters pertaining to Mississippi law will
be passed upon by Wise Carter Child & Caraway, Professional
Association, Mississippi counsel to the Company.
The statements as to matters of law and legal
conclusions made under "Description of Debt Securities" have
been reviewed by Wise Carter Child & Caraway, Professional
Association, Jackson, Mississippi, and by Reid & Priest LLP,
New York, New York, and are set forth herein in reliance
upon the opinions of said firms, respectively, and upon
their authority as experts.
The statements made in the Incorporated Documents as to
matters of law and legal conclusions, based on the belief or
opinion of the Company or otherwise pertaining to (i) titles
to properties, franchises and other operating rights of the
Company, (ii) regulations to which the Company is subject,
and (iii) any legal proceedings to which the Company is a
party, are made on the authority of Wise Carter Child &
Caraway, Professional Association, and such statements are
included in such documents and herein in reliance upon their
authority as experts.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Each
Initial Additional
Sale Sale
Filing Fees_Securities and Exchange
Commission:
Registration Statement $ 91,379 $ -
Application-Declaration 2,000 -
*Rating Agencies' fees 25,000 25,000
*Trustees' fees 7,000 3,000
*Fees of Company's Counsel:
Wise Carter Child & Caraway, 20,000 10,000
Professional Association
Reid & Priest LLP 60,000 25,000
Friday, Eldredge & Clark 10,000 5,000
*Fees of Entergy Services, Inc. 35,000 25,000
*Accounting fees 18,000 12,000
*Printing and engraving costs 30,000 20,000
*Miscellaneous expenses (including Blue- 19,621 15,000
Sky expenses) -------- --------
*Total Expenses $318,000 $140,000
======== ========
___________
* Estimated
Item 15. Indemnification of Directors and Officers.
System Energy has insurance covering its expenditures
which might arise in connection with its lawful
indemnification of its directors and officers for certain of
their liabilities and expenses. Directors and officers of
System Energy also have insurance which insures them against
certain other liabilities and expenses. The corporation
laws of Arkansas permit indemnification of directors and
officers in a variety of circumstances, which may include
liabilities under the Securities Act of 1933, and under
System Energy's Restated and Amended Articles of
Incorporation, its officers and directors may generally be
indemnified to the full extent of such laws.
Item 16. List of Exhibits.
**1 - Form of Underwriting Agreement (filed as
Exhibit B-12 in System Energy's Application-
Declaration on Form U-1 in 70-8511).
*4(a) - Form of Indenture for Unsecured Debt
Securities to be dated as of September 1, 1995
between System Energy and Chemical Bank, as
Trustee.
**4(b) - Form of Debt Security (filed as Exhibit A-6 in
System Energy's Application-Declaration on
Form U-1 in 70-8511).
*4(c) - Form of Officer's Certificate to be used in
designating and authorizing the terms and
conditions of any series of Debt Securities
offered hereunder.
*5(a) - Opinion of Wise Carter Child & Caraway,
Professional Association, Mississippi counsel
for System Energy, as to the legality of the
Debt Securities being registered.
*5(b) - Opinion of Reid & Priest LLP, New York counsel
for System Energy, as to the legality of the
Debt Securities being registered.
**12 - Computations of Ratio of Earnings to Fixed
Charges (filed as Exhibit 12(f) to System
Energy's Annual Report on Form 10-K for the
period ended December 31, 1994, Exhibit 99(f)
to System Energy's Quarterly Report on Form 10-
Q for the period ended March 31, 1995, and
Exhibit 99(f) to System Energy's Quarterly
Report on Form 10-Q for the period ended June
30, 1995, each in File No. 1-9067).
*23(a) - Consent of Wise Carter Child & Caraway,
Professional Association (included in Exhibit
5(a)).
*23(b) - Consent of Reid & Priest LLP (included in
Exhibit 5(b)).
23(c) - Consent of Coopers & Lybrand L.L.P. (filed
herewith)
23(d) - Consent of Deloitte & Touche LLP. (filed
herewith)
*25 - Statement of Eligibility of Trustee on Form T-
1 under the Trust Indenture Act of 1939, as
amended, of Chemical Bank, Trustee.
______________
* Previously filed.
** Incorporated herein by reference as indicated.
Item 17. Undertakings.
The undersigned registrant hereby undertakes
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in this
registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20
percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement.
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in this
registration statement or any material change to such
information in this registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii)
above do not apply if the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to
the Commission by the registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(4) That, for purposes of determining any liability
under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange
Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new
registration statement relating to the securities offered
herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering
thereof.
(5) That, for purposes of determining any liability
under the Securities Act of 1933, the information omitted
from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant
pursuant to Rule 424(b) (1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this
registration statement as of the time it was declared
effective.
(6) That, for the purpose of determining any liability
under the Securities Act of 1933, each post-effective
amendment that contains a form of prospectus shall be deemed
to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(7) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection
with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed
in the Securities Act of 1933 and will be governed by the
final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, as amended, the registrant certifies that this
Amendment No. 2 to the Registration Statement has been
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New Orleans, State of Louisiana,
on the 21st day of September, 1995.
SYSTEM ENERGY RESOURCES, INC.
By: /S/ Donald C. Hintz
Donald C. Hintz, President,
Chief Executive Officer and
Director
Pursuant to the requirements of the Securities Act of
1933, this Amendment No. 2 to the registration statement has
been signed by the following persons in the capacities and
on the dates indicated.
Signature Title Date
/S/Donald C.Hintz President, Chief Executive September 21, 1995
Donald C. Hintz Officer and Director
(Principal Executive Officer)
/S/Gerald D. McInvale Executive Vice President September 21, 1995
Gerald D. McInvale Chief Financial Officer,
and Director
(Principal Financial and
Accounting Officer)
/S/Edwin A. Lupberger Director September 21, 1995
Edwin A. Lupberger
/S/Jerry L. Maulden Director September 21, 1995
Jerry L. Maulden
Exhibit 23(c)
Letterhead of Coopers & Lybrand
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-3 (File No. 33-61189)of our reports dated February 21, l995, on our
audit of the financial statements and financial statement schedules of System
Energy Resources, Inc. as of and for the year ended December 31, 1994, which
reports are included in the Company's Annual Report on Form 10-K. We also
consent to the reference to our firm under the caption "Experts and Legality."
/s/Coopers & Lybrand L.L.P.
New Orleans, Louisiana
September 14, 1995
Exhibit 23(d)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Amendment No. 2 to
Registration Statement No. 33-61189 of System Energy Resources, Inc. on Form
S-3 of our reports dated February 11, 1994 (November 30, 1994 as to Note 2,
"Rate and Regulatory Matters - FERC Settlement"), appearing in System Energy
Resources, Inc.'s Annual Report on Form 10-K for the year ended December 31,
1994 and to the reference to us under the heading "Experts and Legality" in
the Prospectus, which is part of this Registration Statement.
/s/Deliotte & Touche LLP
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
September 18, 1995
