File No. No. 70-7561
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form U-1
POST-EFFECTIVE AMENDMENT NO. 11
TO
APPLICATION-DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
System Energy Resources, Inc. Entergy Corporation
1340 Echelon Parkway 639 Loyola Avenue
Jackson, Mississippi 39213 New Orleans, Louisiana 70113
Entergy Arkansas, Inc. Entergy Louisiana, Inc.
425 West Capitol Avenue 639 Loyola Avenue
Little Rock, Arkansas 72201 New Orleans, Louisiana 70113
Entergy Mississippi, Inc. Entergy New Orleans, Inc.
308 East Pearl Street 639 Loyola Avenue
Jackson, Mississippi 39201 New Orleans, Louisiana 70113
(Names of companies filing this statement and
addresses of principal executive offices)
Entergy Corporation
(Name of top registered holding company
of each applicant or declarant)
C. John Wilder
Executive Vice President and Chief Financial Officer
System Energy Resources, Inc., Entergy Corporation,
Entergy Arkansas Inc., Entergy Louisiana, Inc.,
Entergy Mississippi, Inc. and Entergy New Orleans, Inc.
639 Loyola Avenue
New Orleans, Louisiana 70113
(Name and address of agent for service)
The Commission is also requested to send copies of any
communications in connection with this matter to:
Laurence M. Hamric, Esq. William T. Baker, Jr., Esq.
Ann G. Roy, Esq. Daniel Guetta, Esq.
Entergy Services, Inc. Thelen Reid & Priest LLP
639 Loyola Avenue 40 West 57th Street
New Orleans, Louisiana 70113 New York, New York 10019
<PAGE>
Item 1. Description of Proposed Transaction.
Item 1 of the Application-Declaration in this
proceeding, as previously amended and supplemented, is hereby
further supplemented by adding the following to the end thereof:
System Energy Resources, Inc. ("System Energy") was
previously authorized in this proceeding (HCAR No. 24791,
December 23, 1988) to enter into two separate but identical
arrangements for the sale and leaseback of undivided portions of
its interest in Unit No. 1 of the Grand Gulf Steam Electric
Generating Station. These transactions were consummated on
December 28, 1988. In connection with the equity funding of the
arrangements, financial support in the form of letters of credit
was required to be maintained to secure the payment to the equity
investors (Owner Participants) of certain amounts (Net Casualty
Value) that may be payable by System Energy under the respective
leases from time to time.
As a condition to the issuance of the letters of
credit, System Energy was required to assign, for the benefit of
the letter of credit bank, the administrating bank and the
participating banks, its rights under (a) the Availability
Agreement, dated as of June 21, 1974, as amended ("Availability
Agreement"), among System Energy, Entergy Arkansas, Inc.
("Arkansas"), Entergy Louisiana, Inc. ("Louisiana"), Entergy
Mississippi, Inc. ("Mississippi") and Entergy New Orleans, Inc.
("New Orleans") (Arkansas, Louisiana, Mississippi and New Orleans
collectively being referred to as the "System operating
companies"), and (b) the Capital Funds Agreement, dated as of
June 21, 1974, as amended ("Capital Funds Agreement"), between
System Energy and Entergy Corporation ("Entergy").
Initial letters of credit in an aggregate principal
amount $128,126,450 were issued in 1988 and, pursuant to further
Commission authorization in this proceeding (HCAR No. 25241,
January 11, 1991; HCAR No. 25944, December 10, 1993; and HCAR No.
26601, November 6, 1996), replacement letters of credit were
issued in 1991, 1993 and 1996. The letters of credit issued in
1996 are scheduled to expire on January 15, 2000.
In connection with the 1991 replacement of the letters
of credit, the Commission issued a public notice (HCAR No. 25192,
November 23, 1990) that System Energy proposed, during the basic
terms of the leases, to further extend, increase the amount of
and/or change the pricing terms of subsequent letters of credit,
subject to further Commission authorization. Specifically,
System Energy proposed to (1) increase the letters of credit to
an aggregate amount not in excess of $200,578,150; (2) pay
fronting and annual fees to the bank providing the letters of
credit and other participating banks in any amount not in excess
of an aggregate of 1.4375% per annum on the aggregate amount of
letters of credit outstanding; (3) change the identity of the
letter of credit bank, administrating bank and any participating
bank; (4) extend the letters of credit and the reimbursement
agreement entered into in connection therewith in any increments
of time to July 15, 2015; (5) enter into one or more additional
assignments, for the benefit of the letter of credit bank, the
administrating bank and the participating banks, of System
Energy's rights under the Availability Agreement and the Capital
Funds Agreement pursuant to the terms of one or more additional
assignments and supplementary agreements (the System operating
companies and Entergy to consent to join in the respective
agreements to which they are parties); and (6) pay arrangement
fees in connection with each such extension or increase in an
amount not in excess of 2-1/2% of the highest amount of the
revised letter of credit in question.
Pursuant to the Commission's November 6, 1996 order
(HCAR No. 26601), during the basic terms of the leases, and
without further Commission authorization, (1) System Energy was
authorized to extend, increase the amount of and/or change the
pricing terms of subsequent letters of credit within the
parameters set forth above, (2) System Energy was authorized to
enter into new reimbursement agreements or further amendments to
the then existing reimbursement agreement, and (3) System Energy
and the System operating companies were authorized to enter into
one or more additional assignments of the Availability Agreement,
and System Energy and Entergy were authorized to enter into one
or more additional assignments of the Capital Funds Agreement, in
each case, to provide further security for System Energy's
reimbursement obligations to the letter of credit bank, the
administrating bank and the participating banks.
Due to changes in the credit markets that have occurred
since the issuance of the 1996 replacement letters of credit, The
Chase Manhattan Bank (the current administrating bank) and the
other participating banks are proposing to increase the annual
participation fees to be paid by System Energy in connection with
the replacement letters of credit to be issued on or before
January 15, 2000.
The reimbursement agreement to be entered into in
connection with the replacement letters of credit will provide
for participation fees that will be fixed for a period of 12 to
15 months following the issuance of the replacement letters of
credit (the "Fixed Rate Period"), with fluctuating participation
fees to be payable thereafter based upon System Energy's senior
debt rating. The participation fees to be paid during the Fixed
Rate Period will be within the parameters authorized by the
Commission. Following the Fixed Rate Period, however, the
participation fees may exceed those authorized by the Commission
if a down grade were to occur in System Energy's senior debt
rating. The reimbursement agreement will provide, however, that
if a supplemental order authorizing the increased participation
fees is not obtained by System Energy prior to the end of the
Fixed Rate Period, and if the participating banks have not
unanimously consented to the extension of the Fixed Rate Period,
then the participating banks may have the right to terminate the
letters of credit on 15 days' notice, with the Owner Participants
having the right to draw in full on the letters of credit prior
to such termination.
The maximum fronting and annual fees to be paid in
connection with the replacement letters of credit are not
expected to exceed a per annum amount of 3.75% of the aggregate
amount of letters of credit outstanding. Authorization is herein
requested for System Energy to incur such increased fronting and
annual fees, during the basic terms of the leases, in order to
avoid a possible termination of the letters of credit at the
conclusion of the Fixed Rate Period.
Item 5. Procedure.
The Applicants-Declarants hereby request that the
Commission's supplemental order authorizing the increased
fronting and annual fees set forth herein be issued as soon as
practicable.
The Applicants-Declarants hereby waive a recommended
decision by a hearing officer of the Commission; agree that the
Staff of the Division of Investment Management may assist in the
preparation of the Commission's decision; and request that there
be no waiting period between the issuance of the Commission's
order and the date on which it is to become effective.
Item 6. Exhibits and Financial Statements.
(a) Exhibits:
*B Replacement Letters of Credit, Amended or new
Reimbursement Agreement, Assignment of
Availability Agreement and Assignment of
Capital Funds Agreement.
(b) Financial Statements:
The transactions proposed herein do not contemplate an
increase in the amount of financing currently authorized by the
Commission. Therefore, no financial statements are filed
herewith.
* To be filed by Rule 24 Certificate after execution thereof.
SIGNATURES
Pursuant to the requirements of the Public Utility
Holding Company Act of 1935, the undersigned companies have duly
caused this amendment to be signed on their behalf by the
undersigned thereunto duly authorized.
SYSTEM ENERGY RESOURCES, INC.
ENTERGY CORPORATION
ENTERGY ARKANSAS, INC.
ENTERGY LOUISIANA, INC.
ENTERGY MISSISSIPPI, INC.
ENTERGY NEW ORLEANS, INC.
By: /s/ Steven C. McNeal
Steven C. McNeal
Vice President and Treasurer
Dated: November 9, 1999
