As filed with the Securities and Exchange Commission on June 24, 1996
Registration Number 333-_____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________
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 504-576-4000
601-368-5000
LAURENCE M. HAMRIC, Esq.
ANN G. ROY, Esq.
Entergy Services, Inc.
639 Loyola Avenue
New Orleans, Louisiana 70113
504-576-5841
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
Approximate date of commencement of proposed sale(s) to
the public: From time to time after the effective date of
this registration statement.
If the only securities being registered on this Form
are being offered pursuant to dividend or interest
reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form
are to be offered on a delayed or continuous basis pursuant
to Rule 415 under the Securities Act of 1933, other than
securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [ X ]
If this Form is filed to register additional securities
for an offering pursuant to Rule 462(b) under the Securities
Act, please check the following box and list the Securities
Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed
pursuant to Rule 462(c) under the Securities Act, check the
following box and list the Securities Act registration
statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, please check the
following box. [ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Proposed Proposed
Title of Each Amount to Maximum Maximum Amount of
Class of be Offering Aggregate Registration
Securities to Registered Price Offering Fee
be Registered Per Unit Price (1)
(1)
- --------------- ------------ ---------- ------------ ------------
Debt Securities
First Mortgage
Bonds
- --------------- ------------ ---------- ------------ ------------
Total $300,000,000 100% $300,000,000 $103,448.28
- --------------- ------------ ---------- ------------ ------------
</TABLE>
(1) Exclusive of accrued interest, if any, and
estimated solely for the purpose of calculating the
registration fee.
The Registrant hereby amends this Registration
Statement on such date or dates as may be necessary to delay
its effective date until the Registrant shall file a further
amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933, or until
the Registration Statement shall become effective on such
date as the Commission, acting pursuant to said Section
8(a), may determine.
Pursuant to Rule 429, the prospectus filed as a part of
this registration statement is being filed as a combined
prospectus with respect to $160,000,000 aggregate principal
amount of First Mortgage Bonds remaining unsold pursuant to
Registration Statement No. 33-47662 and $235,000,000
aggregate principal amount of Debt Securities remaining
unsold pursuant to Registration Statement No. 33-61189.
<PAGE>
Subject to Completion
Dated June 24, 1996
P R O S P E C T U S
$695,000,000
SYSTEM ENERGY RESOURCES, INC.
First Mortgage Bonds
Debt Securities
_____________________________
System Energy Resources, Inc. ("System Energy" or the
"Company") intends to offer from time to time up to
$695,000,000 aggregate principal amount of its securities,
of which at least $160,000,000 will consist of First
Mortgage Bonds of the Company (the "New Bonds"), and at
least $235,000,000 will consist of unsecured Debt Securities
of the Company (the "Debt Securities" and together with the
New Bonds, the "Securities"). The remaining $300,000,000
will consist of New Bonds and/or Debt Securities, or any
combination thereof, in one or more series at prices and on
terms to be determined at the time of sale. For each issue
of Securities for which this Prospectus is being delivered
(the "Offered Bonds" or the "Offered Debt Securities", as
the case may be, and, together, the "Offered Securities")
there will be an accompanying Prospectus Supplement (the
"Prospectus Supplement") that sets 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, any
subordination provisions (in the case of the Debt Securities
only), the initial public offering price, the names of any
underwriters or agents, the principal amounts, if any, to be
purchased by the any such underwriters, the compensation of
any 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. The Prospectus
Supplement relating to the Offered Securities will also
contain information concerning certain U.S. Federal income
tax considerations if applicable to the Offered Securities.
See "Risk Factor" 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.
This Prospectus may not be used to consummate sales of
Offered Securities unless accompanied by a Prospectus
Supplement. The Offered 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 ___________________, 1996.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR
AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS
TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN
ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.
_______________
<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, 1995 ( the "1995 10-K").
2. The Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1996.
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 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.
RISK FACTOR
Prospective purchasers of the 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 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.
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 Entergy
Arkansas, Inc., formerly Arkansas Power & Light Company
("Entergy Arkansas"), Entergy Gulf States, Inc., formerly
Gulf States Utilities Company, Entergy Louisiana, Inc.,
formerly Louisiana Power & Light Company ("Entergy
Louisiana"), Entergy Mississippi, Inc., formerly Mississippi
Power & Light Company ("Entergy Mississippi"), Entergy New
Orleans, Inc., formerly New Orleans Public Service Inc.
("Entergy New Orleans," together with Entergy Arkansas,
Entergy Louisiana and Entergy Mississippi, the "System
Operating Companies"). Other subsidiaries of Entergy
include Entergy Services, Inc., a service company, Entergy
Operations, Inc., a nuclear management services company
("Entergy Operations"), CitiPower Ltd., a retail electric
distribution company servicing Melbourne, Australia and
surrounding suburbs, Entergy Power, Inc., a wholesale power
company, and Entergy Enterprises, Inc., a non-utility
company. The System Operating Companies 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 and
the System Operating Companies (the "Unit Power Sales
Agreement") which has been approved by the Federal Energy
Regulatory Commission ("FERC"). (See "Source of Revenue"
below.) At March 31, 1996, the Company had utility plant
(net of accumulated depreciation) of $2.6 billion, long-term
debt of $1.2 billion and common shareholder's equity of $865
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 Entergy Mississippi 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 Entergy Mississippi, 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 the System
Operating Companies in accordance with specified percentages
(Entergy Arkansas 36%, Entergy Louisiana 14%, Entergy
Mississippi 33% and Entergy New Orleans 17%) as ordered by
FERC. Charges under this agreement are paid in
consideration for the respective entitlements of the System
Operating Companies 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 the System
Operating Companies to the Company under the Unit Power
Sales Agreement is approximately $58 million.
The financial condition of the Company depends
exclusively upon the receipt of payments from the System
Operating Companies 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 other commitments and contingent
obligations of the System Operating Companies, reference is
made to Note 8, "Commitments and Contingencies" of the Notes
to the Financial Statements of each of Entergy Arkansas,
Entergy Louisiana, Entergy Mississippi and Entergy New
Orleans in its respective Annual Report on Form 10-K for the
year ended December 31, 1995.
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 Part I, Item 1, "Certain
System Financial and Support Agreements," on page 8 of the
1995 10-K, and to Note 8, "Commitments and Contingencies" of
the Company's Notes to the Financial Statements on page 164
of the 1995 10-K.
Contractual Arrangements for the Benefit of Other Creditors
Substantially all of the Company's property is subject
to the lien of the Mortgage (as defined hereinafter) which
secured approximately $530.3 million of outstanding debt at
March 31, 1996. 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 and the System Operating
Companies (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, the System Operating Companies are
individually obligated to make payments or subordinated
advances to the Company in accordance with stated
percentages (Entergy Arkansas 17.1%, Entergy Louisiana
26.9%, Entergy Mississippi 31.3% and Entergy New Orleans
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 the System Operating
Companies 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 the System Operating Companies, 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
the System Operating Companies 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 referred to above and described
further below. Unlike the New Bonds, 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 or the
Availability Agreement. Holders of the Debt Securities
offered hereby will have no direct legal recourse against
the Company, Entergy or the System Operating Companies under
the terms of the Capital Funds Agreement or the Availability
Agreement. For further information with respect to these
agreements, reference is made to Part I, Item 1, "Certain
System Financial and Support Agreements", on page 8 of the
1995 10-K, and to Note 8, "Commitments and Contingencies" of
the Company's Notes to the Financial Statements on page 164
of the 1995 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 and the System Operating Companies,
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, 1995 of Entergy and the System
Operating Companies.
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
Offered Securities will be set forth in the applicable
Prospectus Supplement.
<TABLE>
<CAPTION>
RATIO OF EARNINGS TO FIXED CHARGES
<S> <C> <C> <C> <C> <C> <C>
Twelve Months Ended
March 31 December 31,
1996 1995 1994 1993 1992 1991
-------- ---- ------- ---- ---- ----
Ratio of Earnings
to Fixed Charges 2.08 2.07 1.23(a) 1.87 2.04 1.74
</TABLE>
_______________________
(a) Earnings for the twelve months ended 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", to the Company's Notes to the
Financial Statements on page 138 of the 1995 10-K.
DESCRIPTION OF THE NEW BONDS
General
Set forth below are certain general terms and
provisions of the New Bonds, which may be issued from time
to time in one or more series. The particular terms of each
series of Offered Bonds will be described in a Prospectus
Statement 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
System Energy's Mortgage and Deed of Trust, dated as of June
15, 1977, to United States Trust Company of New York (the
"Corporate Trustee") and Gerard F. Ganey (successor to
Malcolm J. Hood) (the "Co-Trustee," and together with the
Corporate Trustee, the "Trustees"), as supplemented by
nineteen supplemental indentures thereof and as further
supplemented by one or more supplemental indentures thereto,
(collectively, the "Mortgage"), all of which have been filed
as exhibits to the Registration Statement of which this
Prospectus is a part. All of the bonds issued under the
Mortgage together with the New Bonds are collectively
referred to as "First Mortgage Bonds." Capitalized terms
not otherwise defined herein shall have the respective
meaning assigned to them in the Mortgage.
The New Bonds may be issued in one or more series under
the Mortgage. Reference is made to the Prospectus Supplement
relating to any particular series of Offered Bonds for the
following terms, including among others: (1) the
designation of such series of the New Bonds; (2) the
aggregate principal amount of such series; (3) the date on
which such series will mature; (4) the rate at which such
series will bear interest and the date from which such
interest accrues; (5) the dates on which interest will be
payable; (6) the price, including the "general redemption
prices" and the "special redemption prices" and the other
terms and conditions upon which the particular series may be
redeemed by the Company prior to maturity; and (7) the
designation of the particular Supplementary Capital Funds
Agreement and Assignment and the Assignment of Availability
Agreement, Consent and Agreement to a given series of New
Bonds.
Form, Exchange and Transfer
Unless otherwise specified in the applicable Prospectus
Supplement, the New Bonds of each series will be issued only
in fully registered form in denominations of $1,000 and, at
the option of the Company, in any multiple or multiples of
$1,000.
At the option of the registered owner, subject to the
terms of the Mortgage and the limitations applicable to
global securities, any New Bonds, upon surrender thereof for
cancellation at the office or agency of the Company in the
Borough of Manhattan, The City of New York, shall be
exchangeable for a like aggregate principal amount of bonds
of the same series of other authorized denominations.
Subject to the terms of the Mortgage and the
limitations applicable to global securities, the New Bonds
shall be transferable, upon the surrender thereof for
cancellation, together with a written instrument of transfer
in form approved by the registrar duly executed by the
registered owner or by his duly authorized attorney, at the
office or agency of the Company in the Borough of Manhattan,
The City of New York.
Upon any exchange or transfer of the New Bonds, the
Company may make a charge therefor, sufficient to reimburse
it for any tax or taxes or other governmental charge, as
provided in any supplemental indenture, but the Company
hereby waives any right to make a charge in addition thereto
for any exchange or transfer of the New Bonds.
(Mortgage, Article II).
Redemption
Any terms for the optional or mandatory redemption of
any series of New Bonds will be set forth in the applicable
Prospectus Supplement.
Cash deposited under any provisions of the Mortgage
(with certain exceptions) may be applied to the redemption
or purchase (including the purchase from System Energy) of
First Mortgage Bonds of any series. (Mortgage, Article X).
Security
The New Bonds, together with all other First Mortgage
Bonds now or hereafter issued under the Mortgage, are
secured by the Mortgage, which constitutes, in the opinion
of Wise Carter Child & Caraway, Professional Association
(counsel for System Energy): (i) a valid, first lien on all
real property, which does not include property held by the
Company under leases, and interests in real property and the
improvements thereon specifically described in the granting
clauses of the Mortgage (and not excepted from the Lien of
the Mortgage by the provisions thereof) and (ii) a first
perfected security interest in all personal property,
interests in personal property and fixtures specifically
described in the granting clauses of the Mortgage (and not
excepted from the Lien of the Mortgage by the provisions
thereof), in each case subject to no liens, charges or
encumbrances, other than (a) Excepted Encumbrances, (b)
minor defects and encumbrances customarily found in
properties of like size and character which do not
materially impair the use of the property affected thereby
in the conduct of the business of the Company, and (c)
liens, defects and encumbrances, if any, existing or placed
thereon at the time of acquisition thereof by the Company
and except as limited by bankruptcy law. There are excepted
from the Lien certain property, including all cash and
securities, all products, equipment, apparatus, materials or
supplies held for sale or other disposition or consumable
during use including Nuclear Fuel; rolling stock,
automobiles, vehicles and aircraft and any Space Satellites;
timber, minerals, mineral rights and royalties; and
receivables, contracts, leases and operating agreements.
The Mortgage contains provisions for subjecting after
acquired property (subject to pre-existing liens) to the
Lien thereof, subject to limitations in the case of
consolidation, merger or sale of substantially all of System
Energy's assets. (Mortgage, Sections. 16.02 and 16.03).
The Mortgage requires that most proceeds of property
insurance be held by the Corporate Trustee pending release
to the Company or to stated uses in respect of First
Mortgage Bonds. See Note 8, "Commitments and Contingencies--
Nuclear Insurance" in the Company's Notes to Financial
Statements in the 1995 10-K for information with respect to
an NRC rule which could significantly restrict the
availability of insurance proceeds to the Corporate Trustee
and the holders of First Mortgage Bonds.
The Ninth, Tenth, Fifteenth, Sixteenth and Seventeenth
Series Bonds have as additional security the sole and
exclusive benefit of the Eighteenth, Nineteenth, Twenty-
sixth, Twenty-seventh and Twenty-ninth Assignments of
Availability Agreement, Consent and Agreement, respectively,
and the Eighteenth, Nineteenth, Twenty-sixth, Twenty-seventh
and Twenty-ninth Supplementary Capital Funds Agreements and
Assignments, respectively, and all proceeds therefrom.
(Eleventh, Twelfth, Seventeenth, Eighteenth and Nineteenth
Supplemental Indentures, Section 7.01).
Each series of the New Bonds will have as additional
security the sole and exclusive benefit of its own
Assignment of Availability Agreement, Consent and Agreement
among the Company, the System Operating Companies and the
Trustees and its own Supplementary Capital Funds Agreement
and Assignment among the Company, Entergy and the Trustees,
and all proceeds therefrom. Under the Eighteenth,
Nineteenth, Twenty-sixth, Twenty-seventh and Twenty-ninth
Assignments of Availability Agreement, Consent and Agreement
and each such Assignment relating to the New Bonds,
provisions of the Availability Agreement and such
Assignments may be amended or waived at any time upon the
receipt of consents from the holders of more than 50% of the
aggregate outstanding principal amount of the affected
series of First Mortgage Bonds and any other necessary
consents. Similarly, the Eighteenth, Nineteenth, Twenty-
sixth, Twenty-seventh and Twenty-ninth Supplementary
Capital Funds Agreements and Assignments and each
Supplementary Capital Funds Agreement and Assignment
relating to the New Bonds will provide that the provisions
of the Capital Funds Agreement and such Supplements may be
amended or waived at any time upon the receipt of consents
from the holders of more than 50% of the aggregate
outstanding principal amount of the affected series of First
Mortgage Bonds and any other necessary consents.
Under each Assignment of Availability Agreement,
Consent and Agreement, System Energy has assigned to the
bondholders secured thereby its rights, on a pari passu
basis, to certain payments which the System Operating
Companies have agreed to make to System Energy in respect of
the Grand Gulf Station. Under each Supplementary Capital
Funds Agreement and Assignment, System Energy has assigned
to the bondholders secured thereby its rights, on a pari
passu basis, to certain payments which Entergy has agreed to
make to System Energy. System Energy has reserved the right
to assign its rights to these payments from the System
Operating Companies and Entergy to other lenders on a pari
passu basis. At present these rights are also assigned to a
group of banks providing letters of credit in respect of a
lease of approximately an 11.5% undivided ownership interest
in Grand Gulf 1. See Note 8, "Commitments and Contingencies-
- -Reimbursement Agreement" and Note 9, "Leases--Sale and
Leaseback Transactions" of the Company's Notes to the
Financial Statements on pages 164 and 165, and pages 172 and
173, respectively, in the 1995 10-K and subsequent
Incorporated Documents for further information.
For a further description of the terms of the
Availability Agreement and the Capital Funds Agreement and
related agreements, reference is made to "Capital
Requirements and Future Financing--Certain System Financial
and Support Agreements" on pages 8 and 10 in the 1995 10-K
and subsequent Incorporated Documents.
Further, System Energy has reserved the right to
terminate the Availability Agreement, the Eighteenth,
Nineteenth, Twenty-sixth, Twenty-seventh, and Twenty-ninth
Assignments of Availability Agreement, Consent and Agreement
and each Assignment of the Availability Agreement, Consent
and Agreement relating to the New Bonds, and the Capital
Funds Agreement and the Eighteenth, Nineteenth, Twenty-
sixth, Twenty-seventh, and Twenty-ninth Supplementary
Capital Funds Agreements and Assignments and each
Supplementary Capital Funds Agreement and Assignment
relating to the New Bonds upon delivery to the Corporate
Trustee of an Officers' Certificate stating that: (i) System
Energy's First Mortgage Bonds have been rated A3, A-, or A-
or better, respectively, by Moody's Investors Service,
Standard & Poor's and Duff & Phelps, for at least the
preceding 6 consecutive months, and (ii) System Energy has
obtained written confirmation from each such rating agency,
or their successors, that the ratings of System Energy's
First Mortgage Bonds rated by such rating agency had not
then dropped below A3, A- or A-, respectively, and (iii)
said Agreements are similarly terminated as to all other
outstanding series of First Mortgage Bonds and all other
indebtedness of System Energy. (Eleventh and Twelfth
Supplemental Indentures, Section 9.07, Seventeenth
Supplemental Indenture, Section 9.04, and Eighteenth and
Nineteenth Supplemental Indentures, Section 9.05).
System Energy has reserved the additional right to
terminate the Availability Agreement, each Assignment
relating to the New Bonds, the Capital Funds Agreement and
each Supplementary Capital Funds Agreement and Assignment
relating to the New Bonds upon delivery to the Corporate
Trustee of an Officers' Certificate stating that (i) with
respect to each series of First Mortgage Bonds established
prior to June 1, 1992, either (a) no First Mortgage Bonds of
such series remain Outstanding or (b) the requisite number
of First Mortgage Bonds of such series have consented to the
termination of the Availability Agreement and the
Assignments thereof, the Capital Funds Agreement and the
Supplements thereto, and (ii) said Agreements are similarly
terminated as to all other Outstanding series of First
Mortgage Bonds and all other indebtedness of System Energy.
(Seventeenth Supplemental Indenture, Section 9.04, and
Eighteenth and Nineteenth Supplemental Indentures, Section
9.05).
Under each Supplemental Indenture relating to the New
Bonds, System Energy will covenant that it will not grant
any security interest in its rights under the System
Agreement, the Availability Agreement, the related
Assignment of Availability Agreement, the Capital Funds
Agreement or the related Supplementary Capital Funds
Agreement and Assignment, except for security interests
contemplated by such Assignment of Availability Agreement
and Supplementary Capital Funds Agreement and Assignment,
respectively. In addition, with certain restrictions,
System Energy has covenanted that it will not grant a
security interest in its rights under any agreement for the
sale of capacity and or energy from Grand Gulf 1 unless it
simultaneously or prior thereto, grants to the holder of all
First Mortgage Bonds a pro rata, pari passu interest in such
collateral.
Each Supplemental Indenture relating to the New Bonds
will also permit System Energy to deposit with the Corporate
Trustee cash or United States Government obligations, either
of which would provide security for the New Bonds in lieu of
the Lien of the Mortgage. In such event, System Energy would
remain liable to pay when due the principal of, premium, if
any, and interest on the New Bonds, but would no longer be
subject to the general covenants of such Supplemental
Indenture. If all Outstanding Bonds are similarly defeased,
System Energy would no longer be subject to the covenants of
the Mortgage.
Issuance of Additional First Mortgage Bonds
Subject to the general restrictions on indebtedness
referred to below under
"--Restrictions on Indebtedness," First Mortgage Bonds of any
series may be issued from time to time on the bases of (1)
60% of the lesser of the cost or fair value of property
additions after adjustments to offset retirements; (2)
retirement of First Mortgage Bonds; and (3) deposit of cash.
Deposited cash may be withdrawn upon the bases stated in (1)
and (2). Property additions generally include electric
property acquired but may not include items excepted from
the Lien as summarized above under "Security". Various
earnings tests are applicable in certain cases for the
issuance of additional First Mortgage Bonds. (See "--
Restrictions on Indebtedness"). System Energy presently
expects to issue all of the New Bonds against the retirement
of First Mortgage Bonds or available property additions. At
March 31, 1996, System Energy had $435.7 million of
available property additions, against which
$261.4 million of First Mortgage Bonds could have been
issued. The issuance tests in the Mortgage are not expected
to limit the ability of System Energy to issue the New
Bonds.
Restrictions on Indebtedness
The Mortgage provides that no First Mortgage Bonds
shall be delivered (with certain exceptions relating to
issuance upon the basis of the retirement of First Mortgage
Bonds) unless the Revised Adjusted Net Earnings for 12
consecutive months out of the preceding 15 months equal at
least 2 times the annual interest requirements on all First
Mortgage Bonds at the time Outstanding, including the
additional issue and all indebtedness of prior or equal
rank. No expenses for interest or for the amortization of
debt discount and expense, amortization of property (other
than depreciation or other similar provisions for property
retirement), or for other amortization, or for any other
extraordinary charge to income of whatever kind or nature,
or for refunds of revenues previously collected by System
Energy subject to possible refund, or for any sinking fund
or other device for the retirement of any indebtedness are
required to be deducted from System Energy's revenues or its
other income and no extraordinary items of any kind shall be
included in calculating Revised Adjusted Net Earnings.
(Ninth and Tenth Supplemental Indentures, Article III).
Release and Substitution of Property
Property may be released upon the bases of (i) deposit
of cash or, to a limited extent, purchase money mortgages
(ii) property additions, after adjustments in certain cases
to offset retirements and after making adjustments for
Qualified Lien Bonds outstanding against property additions,
and (iii) waiver of the right to issue First Mortgage Bonds,
without applying any earnings test. Cash may be withdrawn
upon the bases stated in (ii) and (iii) above subject to
certain restrictions. (Mortgage, Article XI).
The Mortgage contains special provisions with respect
to Qualified Lien Bonds pledged, and disposition of moneys
received on pledged prior lien bonds. (Mortgage, Articles
VIII and IX).
Defaults
Defaults are defined as being in default in payment of
principal or any premium; default for 60 days in payment of
interest; certain events in bankruptcy, insolvency or
reorganization; various defaults by Entergy or System Energy
or any of the System Operating Companies in connection with
the Supplementary Capital Funds Agreement and Assignment
related to the New Bonds, the Availability Agreement, the
Assignment of Availability Agreement related to the New
Bonds or the System Agreement, all generally subject to 30-
day grace periods and with the right of the holders of at
least 15% in principal amount of the New Bonds then
Outstanding to give notice of Default in certain such cases;
the cessation of the Supplementary Capital Funds Agreement
and Assignment related to the New Bonds, the Availability
Agreement, and the Assignment of Availability Agreement
related to the New Bonds to be in full force and effect
under certain circumstances, and unless a substitute
agreement is provided under certain conditions; certain
sales, mortgage or pledge of common stock of System Energy
or the System Operating Companies, but not including certain
permitted mergers and dispositions of gas properties; and
default for 90 days after notice of other covenants.
(Mortgage, Section 13.01). The Trustees may withhold notice
of default (except in payment of principal, interest or an
installment of any fund for retirement of First Mortgage
Bonds) if they think it is in the interest of the holders of
First Mortgage Bonds. (Mortgage, Section 13.02).
The Corporate Trustee or holders of 25% of all First
Mortgage Bonds may declare the principal and interest due on
Default. However, a majority in principal amount of all
Outstanding First Mortgage Bonds may annul such declaration
if the Default has been cured. (Mortgage, Section 13.03).
Holders of a majority of First Mortgage Bonds may direct the
time, method and place of conducting any proceeding for any
remedy available to the Trustees or exercising any trust or
power conferred upon the Trustees, but the Trustees are not
required to follow such direction if not sufficiently
indemnified for expenditures. (Mortgage, Section 13.07).
Restriction on Dividends and Stock Redemptions
System Energy may not declare dividends, other than
stock dividends, or make other distributions on or
acquisitions of, its stock (except where concurrently
certain contributions or stock proceeds are received) unless
certain defaults do not exist and the sum of certain
indebtedness does not exceed 65% of adjusted capitalization.
Certain other restrictions on the payment of common stock
dividends by System Energy are discussed under Note 8,
"Commitment and Contingencies--Reimbursement Agreement" of
the Company's Notes to Financial Statements on pages 164 and
165 in the 1995 10-K and subsequent Incorporated Documents.
Modification of the Mortgage
The rights of the holders of First Mortgage Bonds
generally may be modified with the consent of the holders of
66 2/3% of the First Mortgage Bonds and, if less than all
series of First Mortgage Bonds are affected, the consent
also of the holders of 66 2/3% of the First Mortgage Bonds
of each series affected. (Mortgage, Article XIX). The
Company has reserved the right (without any consent or other
action by holders of any series of bonds created after 1991,
including the New Bonds) to substitute for the foregoing
provisions the following: Bondholders' rights may be
modified with the consent of the holders of a majority of
the First Mortgage Bonds, but if less than all series of the
First Mortgage Bonds are so affected, only the consent of a
majority of the affected First Mortgage Bonds is required.
In general, no modification of the terms of payment of
principal or interest and no modification affecting the lien
or reducing the percentage required for modification is
effective against any Bondholder without his consent.
However, various supplemental indentures provide that
certain provisions of the Mortgage may be amended or waived
by the holders of a majority of First Mortgage Bonds of the
related particular series. (Eleventh, Twelfth, Eighteenth
and Nineteenth Supplemental Indentures, Section 9.04 and
Seventeenth Supplemental Indenture, Section 9.03).
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 Debt 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 dated as of September 1, 1995 (the "Indenture")
between the Company and Chemical Bank, as trustee (the
"Indenture 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 Debt Securities for the
following terms, including 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 Indenture
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 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 Indenture Trustee, or to the Company and the
Indenture 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 Indenture 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 Indenture 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 Indenture 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
Indenture 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 Indenture 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 Indenture Trustee, or exercising any
trust or power conferred on the Indenture 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 Indenture Trustee in personal liability
in circumstances where reasonable indemnity would not in the
Indenture Trustee's sole discretion be adequate and (b) the
Indenture 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 a Debt Security 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 Indenture 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 Indenture Trustee may withhold such notice if
the Indenture 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
Indenture 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 Indenture 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 Indenture Trustee may enter into one or
more supplemental indentures, in form satisfactory to the
Indenture 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 Indenture
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 Indenture 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 Indenture 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 Indenture 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
Indenture 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, depository 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 the Indenture Trustee
The Indenture 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 Indenture Trustee and the Company. No resignation or
removal of the Indenture 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 Indenture Trustee
appointed by Act of the Holders, if the Company has
delivered to the Indenture 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 Indenture 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 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
Securities. The 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 Securities
representing the aggregate principal amount of such series
of 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 Securities within the DTC system must be
made by or through Direct Participants, which will receive a
credit for the Securities on DTC's records. The ownership
interest of each actual purchaser of each Security (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 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 Securities except in the event that use of the
book-entry system for the Securities is discontinued.
To facilitate subsequent transfers, all Securities
deposited by Direct Participants with DTC are registered in
the name of DTC's partnership nominee, Cede & Co. The
deposit of the 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 Securities; DTC's records reflect only the
identity of the Direct Participants to whose accounts such
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 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
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 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
respective trustees. 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 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, 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, 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 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
Securities, as nominee of DTC, references herein to Holders
of the Securities shall mean Cede & Co. or DTC and shall not
mean the Beneficial Owners of the Securities.
The information in this section concerning DTC and
DTC's book-entry system has been obtained from DTC. Neither
the Company, the respective trustees nor the underwriters,
dealers or agents takes responsibility for the accuracy or
completeness thereof.
PLAN OF DISTRIBUTION
The Company may sell the 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
1995 and the statements of income, retained earnings, and
cash flows and the related financial statement schedule for
each of the two years in the period ended December 31, 1995,
incorporated by reference in this Prospectus, have been
incorporated by reference herein in reliance on the reports
of Coopers & Lybrand L.L.P., independent accountants, given
on the authority of that firm as experts in accounting and
auditing.
The statements of income, retained earnings, and cash
flows for the year 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, 1995, have been
audited by Deloitte & Touche LLP, independent auditors, as
stated in their report dated February 11, 1994 (November 30,
1994 as to Note 2, "Rate and Regulatory Matters-FERC
Settlement"), also incorporated by reference herein and have
been so included in reliance upon the report of such firm
given upon their authority as experts in accounting and
auditing.
The legality of the 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 and matters
pertaining to Mississippi law and Arkansas law will be
passed upon by Wise Carter Child & Caraway, Professional
Association, counsel to the Company.
The statements made as to matters of law and legal
conclusions made under "Description of the New Bonds" and
the "Description of Debt Securities" have been reviewed by
Wise Carter Child & Caraway, Professional Association,
Jackson, Mississippi, and, except as to "Security" under
"Description of the New Bonds" have been reviewed by Reid &
Priest LLP, New York, New York, and are set forth herein in
reliance upon the opinions of said firm, respectively, and
upon their authority as experts.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Each
Initial Additional
Sale Sale
--------- ---------
Registration Statement $ 103,449 $ -
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, 10,000 5,000
Professional Association
Reid & Priest LLP 40,000 25,000
*Fees of Entergy Services, Inc. 35,000 25,000
*Accountants' fees 18,000 12,000
*Printing and engraving costs 20,000 15,000
*Miscellaneous expense (including 19,551 15,000
blue-sky expenses)
-------- --------
*Total Expenses $280,000 $125,000
======== ========
- --------------------------
* 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, as amended,
(the "Securities Act") and under System Energy's Amended and
Restated Articles of Incorporation, its officers and
directors may generally be indemnified to the full extent of
such laws.
Item 16. List of Exhibits.
**1(a). Form of Underwriting Agreement for the New Bonds
(filed as Exhibit B-1 in System Energy's
Application-Declaration on Form U-1 in File No.
70-8511).
**1(b). Form of Underwriting Agreement for the Debt
Securities (filed as Exhibit B-12 in System
Energy's Application-Declaration on Form U-1 in
File No. 70-8511).
**4(a). Indenture for Unsecured Debt Securities dated as
of September 1, 1995 between System Energy and
Chemical Bank, as Trustee (filed as Exhibit B-
10(a) to Rule 24 Certificate in File No. 70-
8511).
**4(b). Mortgage and Deed of Trust, dated as of June 15,
1977, from System Energy to United States Trust
Company of New York and Gerard F. Ganey
(successor to Malcolm J. Hood), Trustees, as
amended by nineteen Supplemental Indentures
filed respectively as exhibits and in the file
numbers indicated: A-1 in 70-5890 (Mortgage); B
and C to Rule 24 Certificate in 70-5890 (First);
B to Rule 24 Certificate in 70-6259 (Second);
20(a)-5 to Form 10-Q for the quarter ended June
30, 1981, in 1-3517 (Third); A-1(e)-1 to Rule 24
Certificate in 70-6985 (Fourth); B to Rule 24
Certificate in 70-7021 (Fifth); B to Rule 24
Certificate in 70-7021 (Sixth); A-3(b) to Rule
24 Certificate in 70-7026 (Seventh); A-3(b) to
Rule 24 Certificate in 70-7158 (Eighth); B to
Rule 24 Certificate in 70-7123 (Ninth); B-1 to
Rule 24 Certificate in 70-7272 (Tenth); B-2 to
Rule 24 Certificate in 70-7272 (Eleventh); B-3
to Rule 24 Certificate in 70-7272 (Twelfth); B-1
to Rule 24 Certificate in 70-7382 (Thirteenth);
B-2 to Rule 24 Certificate in 70-7382
(Fourteenth); A-2(c) to Rule 24 Certificate in
70-7946 (Fifteenth); A-2(c) to Rule 24
Certificate in 70-7946 (Sixteenth); A-2(d) to
Rule 24 Certificate in 70-7946 (Seventeenth); A-
2(e) to Rule 24 Certificate dated May 4, 1993 in
70-7946 (Eighteenth); and A-2(g) to Rule 24
Certificate dated May 6, 1994, in 70-7946
(Nineteenth).
**4(c). Form of additional Supplemental Indenture(s) for
the New Bonds (filed as Exhibit A-2 in System
Energy's Application-Declaration on Form U-1 in
File No. 70-8511).
**4(d). Form of Debt Security (filed as Exhibit A-6 in
System Energy's Application-Declaration on Form
U-1 in File No. 70-8511).
**4(e). Form of New Bond (filed as Exhibit A-4 in System
Energy's Application-Declaration on Form U-1 in
File No. 70-8511).
**4(f). Form of Officer's Certificate to be used in
designating and authorizing the terms and
conditions of any series of Debt Securities
offered hereunder (filed as Exhibit 4(c) in
Registration Statement No. 33-61189).
**4(g). Capital Funds Agreement, dated June 21, 1974,
between Entergy and System Energy (filed as
Exhibit C to Rule 24 Certificate, dated June 24,
1974 in File No. 70-5399); as amended by the
First Amendment to Capital Funds Agreement,
dated as of June 1, 1989 (filed as Exhibit B to
Rule 24 Certificate, dated June 8, 1989, in File
No. 70-5399).
**4(g)1. Eighteenth Supplementary Capital Funds Agreement
and Assignment, dated as of September 1, 1986,
with United States Trust Company of New York and
Gerard F. Ganey, as Trustees (filed as Exhibit D-
2 to Rule 24 Certificate, dated October 1, 1986,
in File No. 70-7272).
**4(g)2. Nineteenth Supplementary Capital Funds Agreement
and Assignment, dated as of September 1, 1986,
with United States Trust Company of New York and
Gerard F. Ganey, as Trustees (filed as Exhibit D-
3 to Rule 24 Certificate, dated October 1, 1986,
in File No. 70-7272).
**4(g)3. Twenty-sixth Supplementary Capital Funds
Agreement and Assignment, dated as of October 1,
1992, with United States Trust Company of New
York and Gerard F. Ganey, as Trustees (filed as
Exhibit B-3(c) to Rule 24 Certificate dated
November 2, 1992 in File No. 70-7946).
**4(g)4. Twenty-seventh Supplementary Capital Funds
Agreement and Assignment, dated as of April 1,
1993, with United States Trust Company of New
York and Gerard F. Ganey, as Trustees (filed as
Exhibit B-3(d) to Rule 24 Certificate dated May
4, 1993 in File No. 70-7946).
**4(g)5. Twenty-eighth Supplementary Capital Funds
Agreement and Assignment, dated as of December
17, 1993, with Chemical Bank, as Agent (filed as
Exhibit B-3(a) to Rule 24 Certificate dated
December 22, 1993 in File No. 70-7561).
**4(g)6. Twenty-ninth Supplementary Capital Funds
Agreement and Assignment, dated as of April 1,
1994, with United States Trust Company of New
York and Gerard F. Ganey, as Trustees (filed as
Exhibit B-3(f) to Rule 24 Certificate dated May
6, 1994, in File No. 70-7946).
**4(g)7. First Amendment to Supplementary Capital Funds
Agreements and Assignments, dated as of June 1,
1989, by and between Entergy, System Energy,
Deposit Guaranty National Bank, United States
Trust Company of New York and Gerard F. Ganey,
as Trustees (filed as Exhibit C to Rule 24
Certificate, dated June 8, 1989, in File No. 70-
7026).
**4(g)8. First Amendment to Supplementary Capital Funds
Agreements and Assignments, dated as of June 1,
1989, by and between Entergy, System Energy,
United States Trust Company of New York and
Gerard F. Ganey, as Trustees (filed as Exhibit C
to Rule 24 Certificate, dated June 8, 1989, in
File No. 70-7123).
**4(g)9. First Amendment to Supplementary Capital Funds
Agreement and Assignment, dated as of June 1,
1989, by and between Entergy, System Energy and
Chemical Bank (filed as Exhibit C to Rule 24
Certificate, dated June 8, 1989, in File No. 70-
7561).
**4(h). Availability Agreement, dated June 21, 1974,
among System Energy, Entergy Arkansas, Entergy
Louisiana, Entergy Mississippi and Entergy New
Orleans filed respectively as exhibits and in
the file numbers indicated: (B to Rule 24
Certificate, dated June 24, 1974, in 70-5399);
as amended by First Amendment to Availability
Agreement, dated as of June 30, 1977 (B to Rule
24 Certificate, dated June 24, 1977, in 70-
5399); Second Amendment to Availability
Agreement, dated as of June 15, 1981 (E to Rule
24 Certificate, dated July 1, 1981, in 70-6592);
Third Amendment to Availability Agreement, dated
as of June 28, 1984 (B-13(a) to Rule 24
Certificate, dated July 6, 1984, in 70-6985);
Fourth Amendment to Availability Agreement,
dated as of June 1, 1989 (A to Rule 24
Certificate, dated June 8, 1989, in 70-5399).
**4(h)1. Eighteenth Assignment of Availability Agreement,
Consent and Agreement, dated as of September 1,
1986, with United States Trust Company of New
York and Gerard F. Ganey, as Trustees (filed as
Exhibit C-2 to Rule 24 Certificate, dated
October 1, 1986, in File No. 70-7272).
**4(h)2. Nineteenth Assignment of Availability Agreement,
Consent and Agreement, dated as of September 1,
1986, with United States Trust Company of New
York and Gerard F. Ganey, as Trustees (filed as
Exhibit C-3 to Rule 24 Certificate, dated
October 1, 1986, in File No. 70-7272).
**4(h)3. Twenty-sixth Assignment of Availability
Agreement, Consent and Agreement, dated as of
October 1, 1992, with United States Trust
Company of New York and Gerard F. Ganey, as
Trustees
(filed as Exhibit B-2(c) to Rule 24
Certificate, dated November 2, 1992, in File No.
70-7946).
**4(h)4. Twenty-seventh Assignment of Availability
Agreement, Consent and Agreement, dated as of
April 1, 1993, with United States Trust Company
of New York and Gerard F. Ganey, as Trustees
(filed as Exhibit B-2(d) to Rule 24 Certificate
dated May 4, 1993 in File No. 70-7946).
**4(h)5. Twenty-eighth Assignment of Availability
Agreement, Consent and Agreement, dated as of
December 17, 1993, with Chemical Bank, as Agent
(filed as Exhibit B-2(a) to Rule 24 Certificate,
dated December 22, 1993, in File No. 70-7561).
**4(h)6. Twenty-ninth Assignment of Availability
Agreement, Consent and Agreement, dated as of
April 1, 1994, with United States Trust Company
of New York and Gerard F. Ganey, as Trustees
(filed as Exhibit B-2(f) to Rule 24 Certificate
dated May 6, 1994, in File No. 70-7946).
**4(i). Form of New Supplementary Capital Funds
Agreement and Assignment for the New Bonds
(filed as Exhibit 4(e) in Registration Statement
No. 33-47662)
**4(j). Form of New Assignment of Availability
Agreement, Consent and Agreement for the New
Bonds (filed as Exhibit 4(f) in Registration
Statement No. 33-47662).
5(a). Opinion of Wise Carter Child & Caraway,
Professional Association, as to the legality of
the Securities being registered.
5(b). Opinion of Reid & Priest LLP, as to the legality
of the Securities being registered.
**12. Computation of Ratio of Earnings to Fixed
Charges (filed as Exhibit 12(b) to System
Energy's Annual Report on the 1995 Form 10-K and
as Exhibit 99(f) to System Energy's Quarterly
Report on Form 10-Q for the period ended March
31, 1996, 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
23(d). Consent of Deloitte & Touche LLP
.
24. Power of Attorney (see signature page of
Registration Statement).
25(a). Statement of Eligibility of Trustee on Form T-1
under the Trust Indenture Act of 1939, as
amended, of United States Trust Company of New
York, Corporate Trustee.
.
25(b). Statement of Eligibility on Form T-2 under the
Trust Indenture Act of 1939, as amended, of
Gerard F. Ganey, Co-Trustee.
25(c). Statement of Eligibility of Trustee on Form T-1
under the Trust Indenture Act of 1939, as
amended, of Chemical Bank, Indenture Trustee.
_____________
** 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; and
(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; and
(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, as amended,
(the "Exchange Act") that are incorporated by reference in
this registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act, 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, each filing of the registrant's
annual report pursuant to Section 13(a) or 15(d) of the
Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) 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, 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, 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 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 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 and will be governed by the
final adjudication of such issue.
Each director and/or officer of the registrant whose
signature appears below hereby appoints William J. Regan,
Jr., Laurence M. Hamric and Ann G. Roy, and each of them
severally, as his attorney-in-fact to sign in his name and
behalf, in any and all capacities stated below, and to file
with the Securities and Exchange Commission, any and all
amendments, including post-effective amendments, to this
registration statement and the registrant hereby also
appoints each such named person as its attorney in fact with
authority to sign and file any such amendments in its name
and behalf.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, as amended, the registrant certifies that it has
reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and this 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 24th day of June, 1996.
SYSTEM ENERGY RESOURCES, INC.
By: /s/William J. Regan, Jr.
William J. Regan, Jr.
Vice President and Treasurer
Pursuant to the requirements of the Securities Act of
1933, this registration statement has been signed by the
following persons in the capacities and on the dates
indicated.
Signature Title Date
---------------- -------------- -----------
/s/Donald C. Hintz President, June 24, 1996
Chief Executive
Officer and Director
(Principal Executive
Officer)
/s/Gerald D. McInvale Executive Vice June 24, 1996
Gerald D. McInvale President
Chief Financial
Officer,
and Director
(Principal Financial
and
Accounting Officer)
/s/Edwin A. Lupberger Director June 24, 1996
Edwin A. Lupberger
/s/Jerry L. Maulden Director June 24, 1996
Jerry L. Maulden
EXHIBIT 5(a)
June 24, 1996
System Energy Resources, Inc.
1340 Echelon Parkway
Jackson, Mississippi 39213
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3,
including the exhibits thereto, to be filed with the Securities
and Exchange Commission (the "Commission") on or about the date
hereof by System Energy Resources, Inc. (the "Company") for the
registration under the Securities Act of 1933, as amended (the
"Securities Act"), of $300,000,000 in aggregate principal amount
of its First Mortgage Bonds (the "Bonds") and/or its debt
securities (the "Debt Securities," and together with the Bonds,
the "Securities") each to be issued, in one or more series, by
the Company and for the qualification under the Trust Indenture
Act of 1939, as amended, of the Company's Mortgage and Deed of
Trust, as heretofore supplemented and as proposed to be further
supplemented (the "Mortgage"), under which the Bonds are to be
issued, and the Company's Indenture (the "Indenture"), under
which the Debt Securities are to be issued.
We are of the opinion that the Company is a corporation
validly organized, existing and in good standing under the laws
of the State of Arkansas.
We are further of the opinion that all action necessary to
make valid and legal the proposed issuance and sale of the
Securities by the Company will have been taken when:
(a) the Company's said Registration Statement on Form
S-3, as it may be amended, shall have become effective in
accordance with the applicable provisions of the Securities Act,
and a supplement or supplements to the Prospectus specifying
certain details with respect to the offering or offerings of the
Securities shall have been filed with the Commission, and the
Mortgage and the Indenture each shall have been qualified under
the Trust Indenture Act of 1939, as amended;
(b) all necessary regulatory approvals applicable to
the issuance and sale of the Securities and the related
transactions shall have been duly obtained and be in full force
and effect;
(c) appropriate action shall have been taken by the
Board of Directors of the Company for the purpose of authorizing
the consummation of the issuance and sale of the Securities and
the related transactions;
(d) the proposed supplemental indenture relating to
the Bonds being issued, supplemental to the Mortgage, shall have
been duly executed and delivered;
(e) the specific terms of each Debt Security shall
have been determined by supplemental indenture, supplemental to
the Indenture, board resolution or officer's certificate; and
(f) the Securities shall have been appropriately
issued and delivered for the consideration contemplated by, and
otherwise in conformity with, the acts, proceedings and documents
referred to above.
We are further of the opinion that when the foregoing steps
have been taken, the Securities will be legal, valid and binding
obligations of the Company enforceable in accordance with their
terms, except as limited by bankruptcy, insolvency,
reorganization or other laws affecting the enforcement of
mortgagees' and other creditors' rights and general equitable
principles. This opinion does not pass upon the matter of
compliance with "blue sky" laws or similar laws relating to the
sale or distribution of the Securities by underwriters.
We are members of the Mississippi Bar and do not hold
ourselves out as experts on the laws of any other state. As to
matters of Arkansas law, we have examined or caused to be
examined such documents and satisfied ourselves as to such
matters as we have deemed necessary in order to render this
opinion. In giving this opinion, we have relied, as to matters
of New York law, upon an opinion of even date addressed to you by
Reid & Priest LLP of New York, New York. We consent to the
reliance of said firm upon our opinion as it relates to matters
of Arkansas and Mississippi law.
We hereby consent to the use of this opinion as an exhibit
to the Company's said Registration Statement on Form S-3, as it
may be amended, and consent to such references to our firm as may
be made in such Registration Statement and in the Prospectus
constituting a part thereof.
Very truly yours,
WISE CARTER CHILD & CARAWAY
PROFESSIONAL ASSOCIATION
BY:_/s/Betty Toon Collins___
BETTY TOON COLLINS
EXHIBIT 5(b)
June 24, 1996
System Energy Resources, Inc.
1340 Echelon Parkway
Jackson, Mississippi 39213
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3,
including the exhibits thereto, to be filed with the Securities
and Exchange Commission (the "Commission") on or about the date
hereof by System Energy Resources, Inc. (the "Company") for the
registration under the Securities Act of 1933, as amended (the
"Securities Act"), of $300,000,000 in aggregate principal amount
of its First Mortgage Bonds (the "Bonds") and/or its debt
securities (the "Debt Securities", and together with the Bonds,
the "Securities") each to be issued, in one or more series, by
the Company and for the qualification under the Trust Indenture
Act of 1939, as amended, of the Company's Mortgage and Deed of
Trust, as heretofore supplemented and as proposed to be further
supplemented (the "Mortgage"), under which the Bonds are to be
issued, and the Company's Indenture (the "Indenture"), under
which the Debt Securities are to be issued.
We are of the opinion that all action necessary to make
valid and legal the proposed issuance and sale of the Securities
by the Company will have been taken when:
(a) the Company's said Registration
Statement on Form S-3, as it may be amended, shall
have become effective in accordance with the
applicable provisions of the Securities Act, and a
supplement or supplements to the Prospectus
specifying certain details with respect to the
offering or offerings of the Securities shall have
been filed with the Commission, and the Mortgage
and the Indenture each shall have been qualified
under the Trust Indenture Act of 1939, as amended;
(b) all necessary regulatory approvals
applicable to the issuance and sale of the
Securities and the related transactions shall have
been duly obtained and be in full force and
effect;
(c) appropriate action shall have been taken
by the Board of Directors of the Company for the
purpose of authorizing the consummation of the
issuance and sale of the Securities and the
related transactions;
(d) the proposed supplemental indenture
relating to the Bonds being issued, supplemental
to the Mortgage, shall have been duly executed and
delivered;
(e) the specific terms of each Debt Security
shall have been determined by supplemental
indenture, supplemental to the Indenture, board
resolution or officer's certificate; and
(f) the Securities shall have been
appropriately issued and delivered for the
consideration contemplated by, and otherwise in
conformity with, the acts, proceedings and
documents referred to above.
We are further of the opinion that when the foregoing steps
have been taken, the Securities will be legal, valid and binding
obligations of the Company enforceable in accordance with their
terms, except as limited by bankruptcy, insolvency,
reorganization or other laws affecting the enforcement of
mortgagees' and other creditors' rights and general equitable
principles. This opinion does not pass upon the matter of
compliance with "blue sky" laws or similar laws relating to the
sale or distribution of the Securities by underwriters.
We are members of the New York Bar and do not hold ourselves
out as experts on the laws of any other state. As to matters of
Arkansas and Mississippi law, we have relied upon an opinion of
even date addressed to you by Wise Carter Child & Caraway,
Professional Association, of Jackson, Mississippi. We consent to
the reliance of said firm upon our opinion insofar as it relates
to matters of New York law.
We hereby consent to the use of this opinion as an exhibit
to the Company's said Registration Statement on Form S-3, as it
may be amended, and consent to such references to our firm as may
be made in such Registration Statement and in the Prospectus
constituting a part thereof.
Very truly yours,
/s/ Reid & Priest
REID & PRIEST LLP
Exhibit 23(c)
[Letterhead of Cooper & Lybrand]
Consent of Independent Accountants
We consent to the incorporation by reference in this
registration statement on Form S-3 of our reports dated
February 14, 1996, on our audits of the financial statements
and financial statement schedule of System Energy Resources,
Inc. as of and for the years ended December 31, 1995 and
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 & Legality."
/s/Coopers & Lybrand L. L. P.
New Orleans, Louisiana
June 21, 1996
EXHIBIT 23(d)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this
Registration Statement 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 the Annual Report on Form 10-K of
the Company for the year ended December 31, 1995 and to the
reference to us under the heading "Experts" in the
Prospectus which is part of this Registration Statement.
/s/Deloitte & Touche LLP
New Orleans, Louisiana
June 21, 1996
Exhibit 25(a)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
__________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
__________________________
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)
__________________________
UNITED STATES TRUST COMPANY OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-3818954
(Jurisdiction of incorporation (I. R. S. Employer
if not a U. S. national bank) Identification No.)
114 West 47th Street 10036
New York, New York (Zip Code)
(Address of principal
executive offices)
__________________________
System Energy Resources, Inc.
(Exact name of OBLIGOR as specified in its charter)
Arkansas 72-0752777
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
Echelon One 39213
1340 Echelon Parkway (Zip code)
Jackson, Mississippi
(Address of principal executive offices)
__________________________
First Mortgage Bonds
(Title of the indenture securities)
=================================================================
<PAGE>
GENERAL
1. General Information
-------------------
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Federal Reserve Bank of New York (2nd District), New
York, New York (Board of Governors of the
Federal Reserve System).
Federal Deposit Insurance Corporation, Washington, D.C.
New York State Banking Department, Albany, New York
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate
trust powers.
2. Affiliations with the Obligor
-----------------------------
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
3,4,5,6,7,8,9,10,11,12,13,14 and 15.
System Energy Resources, Inc. is currently not in default
under any of its outstanding securities for which United
States Trust Company of New York is Trustee. Accordingly,
responses to Items 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14
and 15 of Form T-1 are not required under General
Instruction B.
16. List of Exhibits
----------------
T-1.1 -- Organization Certificate, as amended, issued
by the State of New York Banking Department
to transact business as a Trust Company, is
incorporated by reference to Exhibit T-1.1 to
Form T-1 filed on September 15, 1995 with the
Commission pursuant to the Trust Indenture
Act of 1939, as amended by the Trust
Indenture Reform Act of 1990 (Registration
No. 33-97056).
<PAGE>
16. List of Exhibits
(cont'd)
T-1.2 -- Included in Exhibit T-1.1.
T-1.3 -- Included in Exhibit T-1.1.
T-1.4 -- The By-Laws of United States Trust Company of
New York, as amended, is incorporated by
reference to Exhibit T-1.4 to Form T-1 filed
on September 15, 1995 with the Commission
pursuant to the Trust Indenture Act of 1939,
as amended by the Trust Indenture Reform Act
of 1990 (Registration No. 33-97056).
T-1.6 -- The consent of the trustee required by
Section 321(b) of the Trust Indenture Act of
1939, as amended by the Trust Indenture
Reform Act of 1990.
T-1.7 -- A copy of the latest report of condition of
the trustee pursuant to law or the
requirements of its supervising or examining
authority.
NOTE
As of June 21, 1996, the trustee had 2,999,020 shares of
Common Stock outstanding, all of which are owned by its
parent company, U. S. Trust Corporation. The term "trustee"
in Item 2, refers to each of United States Trust Company of
New York and its parent company, U. S. Trust Corporation.
In answering Item 2 in this statement of eligibility, as to
matters peculiarly within the knowledge of the obligor or
its directors, the trustee has relied upon information
furnished to it by the obligor and will rely on information
to be furnished by the obligor and the trustee disclaims
responsibility for the accuracy or completeness of such
information.
_____________________
<PAGE>
Pursuant to the requirements of the Trust Indenture Act of
1939, the trustee, United States Trust Company of New York,
a corporation organized and existing under the laws of the
State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of New York, and
State of New York, on the 21st day of June, 1996.
UNITED STATES TRUST COMPANY OF
NEW YORK, Trustee
By: /s/ Margaret Ciesmelewski
---------------------------------------
Margaret Ciesmelewski
Assistant Vice President
<PAGE>
EXHIBIT T-1.6
-------------
The consent of the trustee required by Section 321(b) of the Act.
United States Trust Company of New York
114 West 47th Street
New York, NY 10036
September 1, 1995
Securities and Exchange Commission
450 5th Street, N.W.
Washington, DC 20549
Gentlemen:
Pursuant to the provisions of Section 321(b) of the Trust
Indenture Act of 1939, as amended by the Trust Indenture Reform
Act of 1990, and subject to the limitations set forth therein,
United States Trust Company of New York ("U.S. Trust") hereby
consents that reports of examinations of U.S. Trust by Federal,
State, Territorial or District authorities may be furnished by
such authorities to the Securities and Exchange Commission upon
request therefor.
Very truly yours,
UNITED STATES TRUST COMPANY
OF NEW YORK
----------------------------
By: S/Gerard F. Ganey
Senior Vice President
<PAGE>
EXHIBIT T-1.7
UNITED STATES TRUST COMPANY OF NEW YORK
CONSOLIDATED STATEMENT OF CONDITION
MARCH 31, 1996
--------------
($ IN THOUSANDS)
ASSETS
------
Cash and Due from Banks $ 47,046
Short-Term Investments 50
Securities, Available for Sale 758,118
Loans 1,221,210
Less: Allowance for Credit Losses 13,113
----------
Net Loans 1,208,097
Premises and Equipment 58,360
Other Assets 125,979
----------
TOTAL ASSETS $2,197,650
==========
LIABILITIES
-----------
Deposits:
Non-Interest Bearing $ 387,509
Interest Bearing 1,446,148
---------
Total Deposits 1,833,657
Short-Term Credit Facilities 82,285
Accounts Payable and Accrued Liabilities 128,745
---------
TOTAL LIABILITIES $2,044,687
==========
STOCKHOLDER'S EQUITY
--------------------
Common Stock 14,995
Capital Surplus 42,394
Retained Earnings 96,511
Unrealized Gains on Securities Available
for Sale (Net of Taxes) (937)
----------
TOTAL STOCKHOLDER'S EQUITY 152,963
----------
TOTAL LIABILITIES AND
STOCKHOLDER'S EQUITY $2,197,650
==========
I, Richard E. Brinkmann, Senior Vice President & Comptroller of
the named bank do hereby declare that this Statement of Condition
has been prepared in conformance with the instructions issued by
the appropriate regulatory authority and is true to the best of
my knowledge and belief.
Richard E. Brinkman, SVP & Controller
June 7, 1996
Exhibit 25(b)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM T-2
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
AN INDIVIDUAL DESIGNATED TO ACT AS TRUSTEE
------------------------
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)
------------------------
GERARD F. GANEY
(Name of trustee)
###-##-####
(Social Security Number)
------------------------
114 West 47th Street 10036-1532
New York, New York (Zip Code)
(Business Address)
------------------------
System Energy Resources, Inc.
(Exact name of OBLIGOR as specified in its charter)
Arkansas 72-0752777
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Echelon One 39213
1340 Echelon Parkway (Zip code)
Jackson, Mississippi
(Address of principal executive offices)
------------------------
First Mortgage Bonds
(Title of the indenture securities)
=========================================================================
<PAGE>
I. Affiliations with Obligor.
-------------------------
If the obligor is an affiliate of the trustee, describe each such
affiliation.
II. List of Exhibits.
----------------
List below all exhibits filed as part of this statement of
eligibility.
None.
NOTE
Inasmuch as this Form T-2 is filed prior to the ascertainment by the
Trustee of all facts on which to base responsive answer to Item 1,
the answer to said Item is based upon incomplete information. Item 1
may, however, be considered correct unless amended by an amendment
to this Form T-2.
In answering Item 1 in this Statement of Eligibility, as to matters
peculiarly within the knowledge of the obligor, or its directors, or
officers, the Trustee has relied upon information furnished to him
by the obligor and will rely on information to be furnished by the
obligor and the Trustee disclaims responsibility for the accuracy or
completeness of such information.
------------------------
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, I,
Gerard F. Ganey, have signed this statement of eligibility in the City
of New York, and State of New York, on the 21st day of June, 1996.
By: /s/ Gerard F. Ganey
---------------------------------
Gerard F. Ganey
Exhibit 25(c)
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_________________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
___________________________________________
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2)
________________________________________
CHEMICAL BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
_____________________________________________
SYSTEM ENERGY RESOURCES, INC.
(Exact name of obligor as specified in its charter)
ARKANSAS 72-0752777
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
ECHELON ONE
1340 ECHELON PARKWAY
JACKSON, MISSISSIPPI 39213
(Address of principal executive offices) (Zip Code)
___________________________________________
UNSECURED DEBT SECURITIES
(Title of the indenture securities)
_____________________________________________________
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
New York State Banking Department, State House, Albany,
New York 12110.
Board of Governors of the Federal Reserve System,
Washington, D.C., 20551
Federal Reserve Bank of New York, District No. 2,
33 Liberty Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C.,
20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee
as now in effect, including the Organization Certificate and the
Certificates of Amendment dated February 17, 1969, August 31, 1977,
December 31, 1980, September 9, 1982, February 28, 1985 and December
2, 1991 (see Exhibit 1 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to
Commence Business (see Exhibit 2 to Form T-1 filed in connection with
Registration Statement No. 33-50010, which is incorporated by reference).
3. None, authorization to exercise corporate trust powers
being contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit
4 to Form T-1 filed in connection with Registration Statement No. 33-84460,
which is incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the
Act (see Exhibit 6 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference).
7. A copy of the latest report of condition of the Trustee,
published pursuant to law or the requirements of its supervising or
examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of
1939, the Trustee, Chemical Bank, a corporation organized and existing
under the laws of the State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York and State of New York, on the 20TH
day of JUNE, 1996.
CHEMICAL BANK
By /s/ W.B. Dodge
------------------------------------------
W.B. Dodge
Vice President
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
Chemical Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business March 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
DOLLAR AMOUNTS
ASSETS IN MILLIONS
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin . . . . . . . . $ 3,391
Interest-bearing balances . . . . 2,075
Securities: . . . . . . . . . . . . . . . .
Held to maturity securities . . . . . . . . 3,607
Available for sale securities . . . . . . . 29,029
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold . . . . . . . . 1,264
Securities purchased under agreements to resell 354
Loans and lease financing receivables:
Loans and leases, net of unearned income $73,216
Less: Allowance for loan and lease losses 1,854
Less: Allocated transfer risk reserve 104
-------
Loans and leases, net of unearned income,
allowance, and reserve . . . . . . 71,258
Trading Assets . . . . . . . . . . . . . . 25,919
Premises and fixed assets (including capitalized
leases) . . . . . . . . . . . . . . 1,337
Other real estate owned . . . . . . . . . . 30
Investments in unconsolidated subsidiaries and
associated companies . . . . . . . 187
Customer's liability to this bank on acceptances
outstanding . . . . . . . . . . . . 1,082
Intangible assets . . . . . . . . . . . . . 419
Other assets . . . . . . . . . . . . . . . 7,406
--------
TOTAL ASSETS . . . . . . . . . . . . . . . $147,358
========
<PAGE>
LIABILITIES
Deposits
In domestic offices . . . . . . . . $45,786
Noninterest-bearing . $14,972
Interest-bearing . . 30,814
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's . . . . . . . . . . . . . 36,550
Noninterest-bearing $ 202
Interest-bearing . 36,348
-------
Federal funds purchased and securities sold under agree-
ments to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased . . . . . . 11,412
Securities sold under agreements to repurchase 2,444
Demand notes issued to the U.S. Treasury . 699
Trading liabilities . . . . . . . . . . . . 19,998
Other Borrowed money:
With a remaining maturity of one year or less 11,305
With a remaining maturity of more than one year 130
Mortgage indebtedness and obligations under capitalized
leases . . . . . . . . . . . . . . 13
Bank's liability on acceptances executed and outstanding 1,089
Subordinated notes and debentures . . . . . 3,411
Other liabilities . . . . . . . . . . . . . 6,778
TOTAL LIABILITIES . . . . . . . . . . . . . 139,615
-------
EQUITY CAPITAL
Common stock . . . . . . . . . . . . . . . 620
Surplus . . . . . . . . . . . . . . . . 4,664
Undivided profits and capital reserves . . 3,058
Net unrealized holding gains (Losses)
on available-for-sale securities . . . . . (607)
Cumulative foreign currency translation
adjustments . . . . . . . . . . . . 8
TOTAL EQUITY CAPITAL . . . . . . . . . . . 7,743
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL . . . . . $147,358
========
I, Joseph L. Sclafani, S.V.P. & Controller of the
above-named bank, do hereby declare that this Report of
Condition has been prepared in conformance with the in-
structions issued by the appropriate Federal regulatory
authority and is true to the best of my knowledge and
belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness
of this Report of Condition and declare that it has been
examined by us, and to the best of our knowledge and
belief has been prepared in conformance with the in-
structions issued by the appropriate Federal regulatory
authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER ) DIRECTORS
THOMAS G. LABRECQUE )
