File No. 70-_______
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________
Form U-1
__________________________________
APPLICATION - DECLARATION
Under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
_________________________________
System Energy Resources, Inc. Entergy Corporation
1340 Echelon Parkway 639 Loyola Avenue
Jackson, MS 39213 New Orleans, LA 70113
Entergy Arkansas, Inc. Entergy Louisiana, Inc.
425 West Capitol 4809 Jefferson Highway
Little Rock, AR 72201 Jefferson, LA 70121
Entergy Mississippi, Inc. Entergy New Orleans, Inc.
308 East Pearl Street 1600 Perdido Building
Jackson, MS 39201 New Orleans, LA 70112
(Names of companies filing this statement and addresses of
principal executive offices)
__________________________________
ENTERGY CORPORATION
(Name of top registered holding company parent of each applicant
or declarant)
_________________________________
Jerry W. Yelverton Steven C. McNeal
President and Chief Executive Vice President and Treasurer
Officer Entergy Services, Inc.
System Energy Resources, Inc. 639 Loyola Avenue
1340 Echelon Parkway New Orleans, LA 70113
Jackson, MS 39213
(Name and address of agent for service)
_____________________________________
The Commission is also requested to send copies
of communications in connection with this matter to:
Denise C. Redmann, Esq. John Hood, Esq.
Entergy Services, Inc. Thelen Reid & Priest LLP
639 Loyola Avenue 40 West 57th Street
New Orleans, La. 70113 New York, NY 10019
(504)576-2272 (212)603-2140
(504)576-4150(Fax) (212)603-2001 (Fax)
<PAGE>
Item 1. Description of Proposed Transactions.
Section A. Overview
1. System Energy Resources, Inc. ("System Energy"), a
subsidiary of Entergy Corporation ("Entergy"), a registered
holding company under the Public Utility Holding Company Act of
1935 ("Holding Company Act"), proposes, from time to time through
December 31, 2005 by means of negotiated public offering or
competitive bidding, (1) to issue and sell one or more series of
its First Mortgage Bonds ("Bonds"), and/or one or more series of
its Debentures ("Debentures") in a combined aggregate principal
amount of said Bonds and Debentures not to exceed $350,000,000;
(2) to enter into arrangements for the issuance and sale of tax-
exempt revenue bonds in an aggregate principal amount not to
exceed $500,000,000 ("Tax-Exempt Bonds") to be issued in one or
more series for the financing of certain pollution control
facilities, including but not limited to sewage and/or solid
waste disposal facilities that have not heretofore been the
subject of such financing, or for the refinancing of outstanding
Tax-Exempt Bonds issued for that purpose, including the possible
issuance and pledge as security for the Tax-Exempt Bonds of one
or more new series of System Energy's First Mortgage Bonds in an
aggregate principal amount not to exceed $565,000,000
("Collateral Bonds") which amount of said Collateral Bonds is not
included in the $350,000,000 million aggregate principal amount
of Bonds and Debentures referred to in this subsection (1) above;
and (3) to enter into arrangements for the issuance of municipal
securities in an aggregate principal amount not to exceed
$100,000,000("Municipal Securities") to be issued in one or more
series through a state or local municipal entity ("Municipal
Entity"). System Energy also proposes to acquire, from time to
time, by tender offer, open market purchases or negotiated
purchases, all or a portion of one or more series of its
outstanding Bonds, Debentures and Tax-Exempt Bonds previously
issued for the benefit of System Energy. Each of these proposed
transactions is discussed in detail below.
Section B. Issuance and Sale of First Mortgage Bonds and
Debentures and Related Matters
1. The Bonds will be issued under System Energy's Mortgage
and Deed of Trust, dated as of June 15, 1977, to United States
Trust Company of New York and Gerard F. Ganey (successor to
Malcolm J. Hood), as Trustees, as heretofore amended and
supplemented by twenty-one supplemental indentures ("Mortgage"),
and as proposed to be further supplemented by additional
Supplemental Indenture(s).
2. Each series of Bonds will have such interest rate,
maturity date, redemption, and sinking fund provisions, be
secured by such means, be sold in such manner and at such price
and have such other terms and conditions as shall be determined
at the time of sale.
3. Each series of Bonds will be issued on the basis of
unfunded property additions at the rate of 60% of such property
additions, retirement of outstanding First Mortgage Bonds or such
other bases as may be permissible under the Mortgage. Bonds
issued on the basis of property additions will be subject to an
earnings test as provided in the Mortgage. The terms and
conditions of each series of Bonds and the related Supplemental
Indenture will be supplied to the Securities and Exchange
Commission ("Commission") by Rule 24 Certificate in this file.
4. In order to provide additional security for its
obligations with respect to each series of the Bonds, System
Energy may determine to enter into one or more assignments, for
the benefit of the holders of such Bonds, of its rights under the
Availability Agreement, dated as of June 21, 1974, as amended
("Availability Agreement"), pursuant to the terms of one or more
additional Assignments of Availability Agreement, Consent and
Agreement (each, an "Assignment"). In such event, Entergy
Arkansas, Inc., formerly Arkansas Power & Light Company, Entergy
Louisiana, Inc., formerly Louisiana Power & Light Company,
Entergy Mississippi, Inc., formerly Mississippi Power & Light
Company and Entergy New Orleans, Inc., formerly New Orleans
Public Service Inc., (hereinafter collectively referred to as the
"Operating Companies"), each of which is a party to the
Availability Agreement, will be required to consent to and join
in any such Assignment. (For further information with respect to
any such Assignment, reference is made to Exhibit B-2 hereto.)
5. In addition, as security for its obligations with
respect to each series of Bonds, System Energy may determine to
enter into one or more assignments, for the benefit of the
holders of such Bonds, of its rights under the Capital Funds
Agreement, dated as of June 21, 1974 ("Capital Funds Agreement"),
pursuant to the terms of one or more additional Supplementary
Capital Funds Agreements and Assignments (each, a "Supplementary
Agreement"). In such event, Entergy, which is a party to the
Capital Funds Agreement, will be required to consent to and join
in the Supplementary Agreement For further information with
respect to the Supplementary Agreement, reference is made to
Exhibit B-3 hereto.
6. Under the Availability Agreement, each of the Operating
Companies has agreed to pay System Energy each month, in return
for the right to receive capacity and energy from Grand Gulf 1 (a
nuclear-powered electric generating station located in
Mississippi), such amounts as would be adequate (together with
other funds received by System Energy) to cover a certain
proportion of System Energy's operating expenses and interest
charges as defined therein. The benefits and rights of System
Energy under the Availability Agreement, as supplemented
according to the terms of successive agreements similar to the
Assignment, have been assigned to various creditors of System
Energy since 1977.
7. Under the Capital Funds Agreement, Entergy has agreed
to furnish System Energy capital sufficient to enable System
Energy (a) to maintain a minimum 35% equity ratio, (b) to pay
certain indebtedness when due, and (c) to continue the commercial
operation of Grand Gulf 1. Since 1977, System Energy has entered
into agreements similar to the Supplementary Agreement to secure
System Energy's creditor group. Such agreements extend terms
comparable to the Capital Funds Agreement to each specific
creditor group.
8. For further information with respect to the
Availability Agreement and the Capital Funds Agreement and
previous assignments of each such Agreement, reference is made to
Exhibit B-9 filed herewith and to File Nos. 70-5399, 70-5890, 70-
6259, 70-6592, 70-6600, 70-6913, 70-6985, 70-7021, 70-7026, 70-
7123, 70-7158, 70-7272, 70-7382,70-7533,70-7534, 70-7561 , 70-
7946 and 70-8511. Reference is also made to the Commission's
"Supplemental Memorandum in Connection with Bond Financing," Rel.
No. 23579, January 23, 1985.
9. In addition or as an alternative to the security
provided by assignments of the Availability Agreement and the
Capital Funds Agreement in order to obtain a more favorable
rating on Bonds and consequently improve the marketability
thereof, System Energy may determine to provide an insurance
policy for the payment of the principal of and/or interest,
and/or premium on one or more series of Bonds.
10. The Debentures will be issued under either System
Energy's Debenture Indenture or its Subordinated Debenture
Indenture, to be substantially in the form attached as Exhibit B-
10 and B-11, respectively (each, a "Debenture Indenture"), as may
be supplemented from time to time.
11. Each series of Debentures will have such interest rate,
maturity date, redemption, and sinking fund provisions, be sold
in such manner and at such price and have such other terms and
conditions as shall be determined at the time of sale.
Debentures issued under the Subordinated Debenture Indenture
would be expressly subordinated to Senior Indebtedness, as
defined therein or pursuant thereto, and may also provide that
payment of interest on such Debentures may be deferred, without
creating a default with respect thereto, for specified periods,
so long as no dividends are being paid, or certain actions are
taken related to the retirement of, the capital stock of System
Energy during such period of deferral.
12. In order to obtain a more favorable rating on
Debentures and consequently improve the marketability thereof,
System Energy may also determine to provide an insurance policy
for the payment of the principal of and/or interest and/or
premium on one or more series of Debentures.
13. The terms and conditions of each series of Debentures
will be supplied to the Commission by Rule 24 Certificates in
this file.
14. No series of Bonds or series of Debentures will be sold
if the fixed interest rate or initial adjustable interest rate
thereon would exceed 15% per annum. As to series having an
adjustable interest rate, the initial interest rate for Bonds or
Debentures of such series will be determined in negotiations
between System Energy and the purchasers of such series.
Thereafter, the interest rate on such Bonds or Debentures
("Floating Rate Debt Securities") will be adjusted according to a
pre-established formula or method of determination or will be
that rate which would, when set, be sufficient to remarket the
Bonds of such series or Debentures of such series ("Remarketed
Floating Debt Securities") at their principal amount.
15. The interest rate for Floating Rate Debt Securities
after the initial interest rate period may be set as a percentage
of, or as a specified spread from, a benchmark rate, such as the
London Interbank Offered Rate or the yield to maturity of
specified United States Treasury securities, or may be
established by reference to orders received in an auction
procedure, and will not exceed 15% per annum. Such interest rate
may be adjusted at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
16. It is proposed that each series of the Bonds and
Debentures mature not later than fifty years from the date of
issuance.
17. The interest rate for Remarketed Floating Debt
Securities after the initial interest rate period will not exceed
15% per annum. Paragraphs 18-19 below relate to Bonds and
Debentures that are Remarketed Floating Debt Securities.
18. The Supplemental Indenture to the Mortgage for Bonds
and the Debenture Indenture will provide that holders of Bonds or
Debentures, respectively, which are Remarketed Floating Debt
Securities will have the right to tender or be required to tender
their Bonds or Debentures and have them purchased at a price
equal to the principal amount thereof, plus any accrued and
unpaid interest thereon, on dates specified in, or established in
accordance with, the Supplemental Indenture or Debenture
Indenture. A Tender Agent may be appointed to facilitate the
tender of any Bonds or Debentures by holders. Any holder of
Bonds or Debentures wishing to have such Bonds or Debentures
purchased may be required to deliver such Bonds or Debentures
during a specified period of time preceding such purchase date to
the Tender Agent, if one shall be appointed, or to the
Remarketing Agent appointed to reoffer such tendered Bonds or
Debentures for sale.
19. System Energy will be obligated to pay amounts equal to
the amounts to be paid by the Remarketing Agent or the Tender
Agent pursuant to the Supplemental Indenture or Debenture
Indenture for the purchase of Bonds or Debentures so tendered,
such amounts to be paid by System Energy on the dates such
payments by the Remarketing Agent or the Tender Agent are to be
made; provided, however, that the obligation of System Energy to
make any such payment will be reduced by the amount of any other
monies available therefor, including the proceeds of the sale of
such tendered Bonds or Debentures by the Remarketing Agent. Upon
the delivery of such Bonds or Debentures by holders to the
Remarketing Agent or the Tender Agent for purchase, the
Remarketing Agent will use its best efforts to sell such Bonds or
Debentures at a price equal to the principal amount of such Bonds
or Debentures.
20. System Energy may cause any series of the Bonds and any
series of the Debentures to be sold by competitive bidding,
negotiated underwritten public offering or private placement with
institutional investors.
21. Reference is made to Exhibits A-1, A-2, A-4 and B-1 for
further information with respect to the terms of each series of
Bonds and to Exhibits A-6 through A-9, and B-10 hereto for
further information with respect to the terms of each series of
Debentures.
22. System Energy further proposes to use the net proceeds
derived from the issuance and sale of the Bonds and the issuance
and sale of the Debentures for general corporate purposes,
including, but not limited to, the repayment of outstanding
securities when due and/or the possible redemption or the
acquisition of outstanding First Mortgage Bonds and/or
Debentures, the payment of construction costs and nuclear fuel
costs, the repayment of short- and long-term borrowings and for
other working capital needs.
23. System Energy will not use the proceeds from the sale
of Bonds or from the sale of the Debentures to enter into
refinancing transactions unless (A) the estimated present value
savings derived from the net difference between interest payments
on a new issue of comparable securities and those securities
refunded or purchased is greater, on an after-tax basis, than the
present value of all repurchasing, redemption, tendering and
issuing costs, assuming an appropriate discount rate, determined
on the basis of the then estimated after-tax cost of capital of
Entergy and its subsidiaries on a consolidated basis, or (B)
System Energy shall have notified the Commission of the proposed
refinancing transaction (including the terms thereof) by post-
effective amendment hereto and obtained appropriate supplemental
authorization from the Commission to consummate such transaction.
Section C. Issuance and Sale of Tax-Exempt Bonds and Related
Matters
1. System Energy also may seek to enter into arrangements
for the issuance of Tax-Exempt Bonds pursuant to which System
Energy proposes from time to time through December 31, 2005, to
enter into one or more installment purchase, refunding or other
facilities agreements or one or more supplements and/or
amendments thereto (collectively, a "Facilities Agreement") with
one or more issuing governmental authorities (each an "Issuer")
which will contemplate the issuance and sale by the Issuer(s) of
one or more series of Tax-Exempt Bonds in an aggregate principal
amount not to exceed $500,000,000 pursuant to one or more trust
indentures and/or one or more supplements thereto (collectively,
the "Indenture") between the Issuer(s) and one or more trustees
(collectively, the "Trustee"). Each series of Tax-Exempt Bonds
will have such interest rate, maturity date, redemption, and
sinking fund provisions, be secured by such means, be sold in
such manner and at such price, and have such other terms and
conditions as shall be determined at the time of sale.
2. The proceeds of the sale of Tax-Exempt Bonds, net of any
underwriters' discounts or other expenses payable from proceeds,
will be applied to refinance certain Pollution Control Revenue
Bonds that were previously issued to finance pollution control
facilities at the Grand Gulf Nuclear Station ("Facilities") or to
finance the construction of additional pollution control
facilities as may be deemed necessary or desirable. Pursuant to
the terms of each Facilities Agreement, System Energy will agree
to purchase, acquire, construct and install the Facilities unless
the Facilities are already in operation. The Issuer will agree
to pay to System Energy an amount equal to the lesser of (a) the
total amount of the proceeds from the sale of the Tax-Exempt
Bonds or (b) the total cost of the Facilities, in the case of
Facilities under construction. Pursuant to the provisions of the
Facilities Agreement, System Entergy will be obligated to make
payments sufficient to provide for payment by the Issuer of the
principal or redemption price of, premium, if any, and interest
on, and other amounts owing with respect to the Tax-Exempt Bonds,
together with related expenses. Such payments will be paid by
System Energy directly to the Trustee under the Indenture. Under
the Facilities Agreement, System Energy may also be obligated to
pay (i) the fees and charges of the Trustee and any registrar or
paying agent under the Indenture, and the Remarketing Agent and
the Tender Agent, as hereinafter referred to, (ii) all expenses
incurred by the Issuer in connection with its rights and
obligations under the Facilities Agreement, (iii) all expenses
necessarily incurred by the Issuer or the Trustee under the
Indenture in connection with the transfer or exchange of Tax-
Exempt Bonds, and (iv) certain other fees and expenses.
3. The Indenture may provide that, upon the occurrence of
certain events relating to the operation of the Facilities or as
provided in the Facilities Agreement, Tax-Exempt Bonds will be
redeemable by the Issuer at the direction of System Energy. Any
series of Tax-Exempt Bonds may be made subject to a mandatory
cash sinking fund under which stated portions of Tax-Exempt Bonds
of such series are to be retired at stated times. Tax-Exempt
Bonds may be subject to mandatory redemption in certain other
cases. The payments by System Energy in such circumstances shall
be sufficient (together with any other monies held by the Trustee
under the Indenture and available therefor) to pay the principal
of all Tax-Exempt Bonds to be redeemed or retired, the premium,
if any, together with interest accrued or to accrue to the
redemption date on such bonds.
4. It is proposed that each series of the Tax-Exempt Bonds
mature not earlier than five years from the first day of the
month of issuance nor later than fifty years from the date of
issuance. Tax-Exempt Bonds will be subject to optional
redemption by the Issuer, at the direction of System Energy, in
whole or in part at the redemption prices (expressed as
percentages of the principal amount thereof) plus accrued
interest to the redemption date, and at the times, set forth in
the Indenture.
5. The Facilities Agreement and the Indenture for each
series of Tax-Exempt Bonds may provide for a fixed interest rate
and/or for an adjustable interest rate as hereinafter described.
No series of Tax-Exempt Bonds will be sold if the fixed interest
rate or initial adjustable interest rate thereon will exceed 13%
per annum. The initial interest rate for Tax-Exempt Bonds of a
series having an adjustable interest rate will be determined in
negotiations between System Energy and the purchasers of such
series. Thereafter, the interest rate on such Tax-Exempt Bonds
will be adjusted according to a pre-established formula or method
of determination ("Floating Rate Securities") or would be that
rate which would, when set, be sufficient to remarket the Tax-
Exempt Bonds of such series ("Remarketed Securities") at their
principal amount.
6. The interest rate for Floating Rate Securities after
the initial interest rate period may be fixed as a percentage of,
or as a specified spread from, a benchmark rate, such as the
London Interbank Offered Rate or the yield to maturity of
specified United States Treasury securities, or may be
established by reference to orders received in an auction
procedure, and will not exceed 13% per annum. Such interest rate
may be adjusted at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
7. The interest rate for Remarketed Securities after the
initial interest rate period will not exceed 13% per annum.
8. The Facilities Agreement and the Indenture will provide
that holders of Tax-Exempt Bonds which are Remarketed Tax-Exempt
Securities will have the right to tender or be required to tender
their Tax-Exempt Bonds and have them purchased at a price equal
to the principal amount thereof, plus any accrued and unpaid
interest thereon, on dates specified in, or established in
accordance with, the Indenture. A Tender Agent may be appointed
to facilitate the tender of any Tax-Exempt Bonds by holders
thereof. Any holder of Tax-Exempt Bonds wishing to have such Tax-
Exempt Bonds purchased may be required to deliver such Tax-Exempt
Bonds during a specified period of time preceding such purchase
date to the Tender Agent, if one shall be appointed, or to the
Remarketing Agent appointed to reoffer such tendered Tax-Exempt
Bonds for sale.
9. Under the Facilities Agreement, System Energy will be
obligated to pay amounts equal to the amounts to be paid by the
Remarketing Agent or the Tender Agent pursuant to the Indenture
for the purchase of Tax-Exempt Bonds so tendered, such amounts to
be paid by System Energy on the dates such payments by the
Remarketing Agent or the Tender Agent are to be made; provided,
however, that the obligation of System Energy to make any such
payment under the Facilities Agreement will be reduced by the
amount of any other monies available therefor, including the
proceeds of the sale of such tendered Tax-Exempt Bonds by the
Remarketing Agent. Upon the delivery of such Tax-Exempt Bonds by
holders to the Remarketing Agent or the Tender Agent for
purchase, the Remarketing Agent will use its best efforts to sell
such Tax-Exempt Bonds at a price equal to the principal amount of
such Tax-Exempt Bonds.
10. In order to obtain a more favorable rating on any
series of Tax-Exempt Bonds and, thereby, improve the
marketability thereof, System Energy may arrange for one or more
irrevocable letter(s) of credit (a "Letter of Credit") from one
or more banks (the "Bank") in favor of the Trustee. In such
event, payments with respect to principal, premium, if any,
interest and purchase obligations in connection with such series
of Tax-Exempt Bonds, coming due during the term of the Letter of
Credit, which term will not exceed 10 years, will be secured by,
and payable from funds drawn under, the Letter of Credit. In
order to induce the Bank to issue the Letter of Credit, System
Energy will enter into a Reimbursement Agreement ("Reimbursement
Agreement") with the Bank pursuant to which System Energy will
agree to reimburse the Bank immediately or within a specified
period (not to exceed 60 months) after the date of the draw for
all amounts drawn under the Letter of Credit with interest
thereon at a rate not to exceed the Bank's prime commercial
lending rate plus 2%. The terms of the Reimbursement Agreement
will correspond in all pertinent respects to the terms of the
Letter of Credit.
11. It is anticipated that the Reimbursement Agreement will
require the payment by System Energy to the Bank of up-front
letter of credit arrangement fees not to exceed 1% of the face
amount of the Letter of Credit and annual fees not to exceed 2%
of the face amount of the Letter of Credit. Any such Letter of
Credit will expire or be terminable prior to the maturity date of
the series of Tax-Exempt Bonds that the Letter of Credit supports
and, in connection with such expiration or termination, such
series of Tax-Exempt Bonds may be made subject to mandatory
redemption or purchase on or prior to the date of expiration or
termination of the Letter of Credit, subject to the right of
owners of Tax-Exempt Bonds of such series not to have their Tax-
Exempt Bonds redeemed or purchased. Provision may be made, as to
any such series of Tax-Exempt Bonds, for extension of the term of
the Letter of Credit or for the replacement thereof, upon its
expiration or termination, by another Letter of Credit (having
substantially the same terms as the original Letter of Credit)
from the Bank or a different bank or banks. Such extended or
replacement letters of credit will not expire later than the
final maturity date of the related Tax-Exempt Bonds.
12. In addition or as an alternative to the security
provided by a Letter of Credit, in order to obtain a more
favorable rating on Tax-Exempt Bonds and consequently improve the
marketability thereof, System Energy may (a) determine to provide
an insurance policy for the payment of the principal of and/or
interest and/or premium on one or more series of Tax-Exempt
Bonds, and/or (b) provide security for holders of Tax-Exempt
Bonds and/or the Bank by obtaining the authentication of and
pledging one or more new series of First Mortgage Bonds
("Collateral Bonds") under the Mortgage, as it may be
supplemented. Premiums on any insurance policies will not exceed
the rate of premiums generally obtained at the time of entering
into the insurance arrangements by companies of comparable credit
quality on insurance policies having comparable terms.
Collateral Bonds will be issued on the basis of unfunded net
property additions and/or retired bond credits and will be
delivered to the Trustee under the Indenture and/or the Bank to
evidence, in part, and secure System Energy's obligations under
the Facilities Agreement for the Facilities financed and/or
System Energy's obligation to reimburse the Bank under the
Reimbursement Agreement. These Collateral Bonds can be issued in
several ways. First, if Tax-Exempt Bonds bear a fixed interest
rate, Collateral Bonds can be issued in a principal amount equal
to the principal amount of such Tax-Exempt Bonds and bear
interest at a rate equal to the rate of interest on such Tax-
Exempt Bonds. Secondly, they can be issued in a principal amount
equivalent to the principal amount of such Tax-Exempt Bonds plus
an amount equal to interest on those Bonds for a specified
period. In such case, Collateral Bonds will bear no interest.
Thirdly, Collateral Bonds can be issued in a principal amount
equivalent to the principal amount of such Tax-Exempt Bonds plus
an amount equal to interest on those Tax-Exempt Bonds for a
specified period, but carry a fixed interest rate that will be
lower than the fixed interest rate of the Tax-Exempt Bonds.
Fourthly, they can be issued in a principal amount equivalent to
the principal amount of Tax-Exempt Bonds at an adjustable rate of
interest, varying with such Tax-Exempt Bonds but having a "cap"
(not greater than 13%) above which the interest on Collateral
Bonds could not rise. For further information with respect to
the Reimbursement Agreement, the proposed insurance arrangements
and the Collateral Bonds, reference is made to Exhibits A-3, A-5,
and B-4 through B-8. System Energy will not use a combination of
Letter of Credit, insurance arrangements and/or Collateral Bonds
to secure any series of Tax-Exempt Bonds unless the resulting
effective interest cost savings on such series is greater than
the total cost of providing such additional security.
13. Each series of the Collateral Bonds that bear interest
will bear interest at a fixed interest rate or initial adjustable
interest rate not to exceed 13%. The maximum aggregate principal
amount of the Collateral Bonds to be issued will not exceed
$565,000,000. The Collateral Bonds will be in addition to the
aggregate limitation on the Bonds proposed in Section B above.
The terms of the Collateral Bonds relating to maturity, interest
payment dates, if any, redemption provisions and acceleration
will correspond to the terms of the related Tax-Exempt Bonds.
Upon issuance, the terms of each series of the Collateral Bonds
will not vary during the life of such series except for the
interest rate of any such series that bears interest at an
adjustable rate.
14. As additional security for its obligations to make
payments under the Facilities Agreement and/or as security for
its obligation to make payment on the Collateral Bonds, System
Energy may assign, for the benefit of the Trustee under the
Indenture and/or System Energy's Mortgage Trustees, respectively,
its rights under the Availability Agreement pursuant to the terms
of an Assignment. In such event, the Operating Companies will be
required to consent to and join in the Assignment. For further
information with respect to any such Assignment, reference is
made to Exhibit B-2 hereto.
As additional security for its obligations to make payments
under the Agreement and/or as security for its obligation to make
payments on the Collateral Bonds, System Energy may assign, for
the benefit of the Trustee under the Indenture and/or System
Energy's Mortgage Trustees, respectively, its rights under the
Capital Funds Agreement pursuant to the terms of a Supplementary
Agreement. In such event, Entergy will be required to consent to
and join in the Supplementary Agreement. For further
information with respect to any such Supplementary Agreement,
reference is made to Exhibit B-3 hereto.
In the event the Tax-Exempt Bonds are secured by a Letter of
Credit, such Assignment and Supplementary Agreement may be
provided to the Bank furnishing Letter of Credit.
15. For further information with respect to the terms of
the Facilities Agreement and Indenture, reference is made to
Exhibits B-4, B-6 and B-7.
16. It is contemplated that Tax-Exempt Bonds may be sold by
the Issuer pursuant to arrangements with an underwriter or a
group of underwriters or by private placement in a negotiated
sale or sales. While System Energy may not be party to the
underwriting agreement or placement arrangements, such
arrangements will assure that the terms of Tax-Exempt Bonds, and
their sale by the Issuer(s), are satisfactory to System Energy,
and System Energy will provide certain related representations
and certain indemnities for liabilities arising from material
misstatements or omissions in disclosures made by System Energy
in connection with the issuance of Tax-Exempt Bonds. System
Energy understands that interest payable on Tax-Exempt Bonds
(except for interest on any Tax-Exempt Bond during a period in
which it is held by a person who is a "substantial user" of the
Facilities or a "related person" within the meaning of Section
147(a) of the Internal Revenue Code of 1986) will not be included
in the gross income of the holders thereof for certain state
income tax purposes in the state of the Issuer, and for Federal
income tax purposes under the provisions of Section 103 of such
Code, as amended to the day of issuance of Tax-Exempt Bonds. (The
interest rates on tax-exempt bonds have been, and are expected to
be, lower at the time(s) of issuance of Tax-Exempt Bonds than the
interest rates on bonds of similar tenor, maturities and
comparable quality, interest on which is subject to Federal
income tax.
Section D. Issuance and Sale of Municipal Securities and Related
Matters
System Energy may also seek to enter into arrangements for
the issuance of Municipal Securities. System Energy proposes
from time to time through December 31, 2005 to enter into one or
more agreements, either directly or through an affiliate of
System Energy, with such governmental authority as may be
authorized by state or local law (collectively referred to herein
as the "Municipal Entity"), whereby the Municipal Entity will
issue securities to the public on behalf of System Energy or will
loan money to System Energy through a bank, an affiliate of
System Energy, or other person, where the proceeds of such
financing will be used to pay certain of System Energy's costs.
System Energy will enter into such arrangements to benefit from
certain tax exemptions offered by a state or local taxing
authority. Certain purchasers of Municipal Securities may
benefit from state or local income tax exemptions on interest
they receive from the Municipal Securities.
Section E. Acquisition of Outstanding Tax-Exempt Bonds and
Related Matters
System Energy further proposes to use, in addition to, or as
an alternative for, the net proceeds from the issuance and sale
of the Bonds and the issuance and sale of the Debentures, other
available funds to acquire and retire at any time or from time to
time prior to December 31, 2005, by means of tender offer, open
market, negotiated or other purchases, or redemption, in whole or
in part, prior to their respective maturities, one or more series
of outstanding Tax- Exempt Bonds ("Outstanding Tax-Exempt
Bonds"). Certain of the Outstanding Tax-Exempt Bonds may not be
redeemed due to call or refunding restrictions. Accordingly,
System Energy may apply all or a portion of the proceeds from the
sale of the Bonds and the sale of the Debentures either to the
purchase for cash of all or a portion of one or more series of
Outstanding Tax-Exempt Bonds through tender offers, open market,
negotiated, or other forms of purchases or otherwise or to the
redemption of such Outstanding Bonds as are by their terms
redeemable.
2. The authority sought herein is in addition to any
acquisitions, retirements or redemptions that may be effected by
the Company pursuant to the exemptions set forth in Rule 42 under
the Holding Company Act or other rules or orders of the
Commission from time to time in effect.
Section F. Other
The proceeds to be received from the issuance and sale of
the Bonds, Debentures and Tax-Exempt Bonds will not be used to
invest directly or indirectly in an exempt wholesale generator
("EWG") or foreign utility company ("FUCO"), as defined in
Sections 32 and 33, respectively, of the Holding Company Act. If
the proceeds from such sales are used to refund outstanding
securities, any savings from the refunding transactions will not
be used to acquire or otherwise invest in an EWG or FUCO.
Information with respect to Entergy's EWG investments must be
supplied by amendment.
The proposed transactions are also subject to Rule 54., In
determining whether to approve the issue or sale of a security by
a registered holding company for purposes other than the
acquisition of an EWG or FUCO, or other transactions by such
registered holding company or its subsidiaries other than with
respect to EWGs or FUCOs, the Commission shall not consider the
effect of the capitalization or earnings of any subsidiary which
is an EWG or a FUCO upon the registered holding company system if
Rules 53(a), (b) and (c) are satisfied. In that regard, assuming
consummation of the transactions proposed in this application,
all of the conditions set forth in Rule 53(a) are and will be
satisfied and none of the conditions set forth in Rule 53(b)
exists or, as a result thereof, will exist.
Entergy states that for purposes of Rule 53(a)(1) its
"aggregate investment" in EWGs and FUCOs is approximately
$1,047,322,020, representing approximately 36.63 % of Entergy's
consolidated retained earnings as of June 30, 2000. Furthermore,
Entergy has complied with and will continue to comply with the
record keeping requirements of Rule 53(a)(2) concerning
affiliated EWGs and FUCOs. In addition, as required by Rule
53(a)(3), no more than 2% of the employees of Entergy's domestic
public utility subsidiary companies would render services to
affiliated EWGs and FUCOs. Finally, none of the conditions set
forth in Rule 53 (b), under which the provisions of Rule 53 would
not be available, have been met.
Entergy currently is not rated by Standard & Poor's Ratings
Group. However, all of Entergy's operating companies have senior
debt ratings of at least investment grade.
Section G. Capitalization Ratios
Entergy states that as of June 30, 2000, Entergy's
consolidated capitalization consisted of 47.4% equity (including
preferred stock not subject to sinking fund) and 52.6% debt,
(including long-term debt, currently maturing long-term debt and
preferred stock of subsidiaries with sinking fund)Entergy states
that its consolidated capitalization ratio will not be materially
affected by this transaction. Entergy further states that as of
September 30, 1992, before the original investment by Entergy in
EWGs or FUCOs, Entergy's consolidated debt to total capital ratio
was 54.6% and its capitalization ratio was 45.4%. The
Commission has previously approved other applications in which
the declarants stated similar debt to equity ratios as those
stated by Entergy.
Item 2. Fees, Commissions and Expenses
The fees, commissions and expenses, other than those of the
underwriters, to be incurred in connection with the issuance and
sale of the Bonds and Debentures are not expected to exceed the
following:
Initial Each
Sale Additional Sale
*Registration Statement $ 92,400 $
Application - Declaration 2,000 _
*Rating Agencies' Fees 25,000 25,000
*Trustee's Fees 7,000 5,000
*Fees of Company Counsel:
Friday, Eldredge & Clark 10,000 5,000
Wise Carter Child & Caraway 10,000 5,000
Thelen Reid & Priest 40,000 25,000
*Fees of Entergy Services, Inc. 35,000 25,000
*Accountants' Fees 18,000 12,000
*Printing and engraving costs 25,000 20,000
*Miscellaneous expenses (including 20,000 15,000
Blue sky expenses)
----------- -----------
Total $ 284,400 $ 137,000
=========== ===========
The fees, commissions and expenses, other than those of the
underwriters, to be incurred in connection with the issuance and
sale of the Tax-Exempt Bonds (including the expenses related to
the issuance and pledge of the Collateral Bonds) are not expected
to exceed the following:
Initial Each
Sale Additional Sale
*Rating Agencies' Fees 25,000 25,000
*Trustee's Fees 55,000 15,000
*Fees of Bond Counsel 80,000 80,000
*Fees of State Bond Commission 30,000 30,000
*Fees of Company Counsel:
Friday, Eldredge & Clark 10,000 5,000
Wise Carter Child & Caraway 10,000 5,000
Thelen Reid & Priest 40,000 25,000
*Fees of Entergy Services, Inc. 35,000 25,000
*Accountants' Fees 18,000 12,000
*Printing and engraving costs 25,000 20,000
*Miscellaneous expenses (including 20,000 15,000
Blue sky expenses)
----------- -----------
Total $ 348,000 $ 257,000
________ =========== ===========
*Estimated
The fees, commissions and expenses, other than those of the
underwriters to be incurred in connection with the issuance and
sale of the Municipal Securities are not expected to exceed 5% of
the aggregate principal amount thereof.
Item 3. Applicable Statutory Provisions
The sections of the Holding Company Act and rules thereunder
which the Applicants-Declarants consider applicable to the
proposed transactions are set forth below:
a. Issuance and sale of the Bonds and the Debentures -
Sections 6(a) and 7 and Rules 23 and 24;
b. Assignments of Availability Agreement and Capital Funds
Agreement (the obligation of the Operating Companies and Entergy,
respectively, to indemnify System Energy under such Agreements) -
Section 12 (b) and Rule 45;
c. Tax-exempt financing of the Facilities:
(i) Disposition of the - Section 12(d) and
Facilities to the Rule 44
Issuer(s)
(ii) Reacquisition of the - Sections 9(a) and
Facilities from the 10
Issuer(s)
(iii) Refunding Agreements for - Sections 6(a) and 7
refunding of outstanding
tax-exempt bonds
(iv) Reimbursement Agreement - Sections 6(a) and 7
(v) Issuance and Pledge of - Sections 6(a) and 7
Collateral Bonds
(vi) Acquisition of outstanding - Sections 9(a), 10,
tax-exempt bonds with 12(c) and Rule 42;
proceeds from issuance(s)
of Tax-Exempt Bonds
d. Municipal Securities- Section 6(a) and 7;
e. Acquisition of Outstanding Tax-Exempt Bonds - Sections
9(a), 10, 12(c) and Rule 42. Pursuant to amended Rule 42, System
Energy may acquire, redeem and/or retire any of its outstanding
securities (other than Tax-Exempt Bonds) without prior Commission
approval.
The Company further requests any additional authority
required under the Holding Company Act or Rules thereunder for
the transactions described in this Application-Declaration.
Item 4. Regulatory Approval
No Federal or State commission other than the Commission has
jurisdiction over the transactions proposed in this Application-
Declaration, except possibly the Louisiana Public Service
Commission which may have jurisdiction over the Assignments of
the Availability Agreement by Entergy Louisiana, Inc., as
additional security for the obligations with respect to each
series of Bonds.
Item 5. Procedure
The applicants request that the Commission's notice of
proposed transactions published pursuant to Rule 23(e) be issued
as soon as possible, and that the Commission's order authorizing
the remaining transactions proposed in this proceeding be issued
by December 31, 2000, at which time System Energy's existing
financing authority from the Commission will expire.
The applicants hereby waive a recommended decision by a
hearing officer or any other responsible 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 it is to become
effective.
The applicants request that the Commission's order
authorizing the above transactions release reservations of
jurisdiction over (i) the execution of and performance under any
Reimbursement Agreement underlying any letter of credit issued as
security for System Energy's obligations in connection with the
issuance and sale of Tax-Exempt Bonds and (ii) the proposed
issuance and sale of Debentures, in each case pending completion
of the records with respect thereto.
Item 6. Exhibits and Financial Statements
Section A. Exhibits
*A-1 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 supplemented by twenty-one (21)
Supplemental Indentures (filed, respectively, as the
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 in 70-7946 (Eighteenth); A-2(g) to Rule
24 Certificate in 70-7946 (Nineteenth); A-2(a)(1) to
Rule 24 Certificate in 70-8511 (Twentieth); and A-
2(a)(2) to Rule 24 Certificate in 70-8511 (Twenty-
first)).
*A-2 Proposed form of additional Supplemental Indenture(s)
to the Mortgage and Deed of Trust relating to the
Bonds (filed as Exhibit A-2 in File No. 70-8511).
*A-3 Proposed form of additional Supplemental Indenture(s)
to the Mortgage and Deed of Trust relating to the
Collateral Bonds (filed as Exhibit A-3 in File No. 70-
8511).
*A-4 Proposed form of Bond (filed as Exhibit A-4 in File
No. 70-8511).
*A-5 Proposed form of Collateral Bond (filed as Exhibit A-5
in File No. 70-8511).
*A-6 Proposed form of Debenture (filed as Exhibit A-6 in
File No. 70-8511).
*A-7 Proposed form of Subordinated Debenture (filed as
Exhibit A-7 in File No. 70-8511).
*A-8 Proposed form of Debenture Indenture (filed as Exhibit
B-10 in File No. 70-8511)
*A-9 Proposed form of Subordinated Debenture Indenture
(filed as Exhibit B-11 in File No. 70-8511).
*B-1 Proposed form of Underwriting or Purchase Agreement
for sale(s) of the Bonds (filed as Exhibit B-1 in File
No. 70-8511).
*B- Proposed form of assignment(s) of Availability
2(a) Agreement (First Mortgage Bonds) (filed as Exhibit B-
2(a) in File No. 70-8511).
*B- Proposed form of assignment(s) of Availability
2(b) Agreement (Collateral Bonds) (filed as Exhibit B-2(b)
in File No. 70-8511).
*B- Proposed form of assignment(s) of Capital Funds
3(a) Agreement (First Mortgage Bonds) (filed as Exhibit B-
3(a) in File No. 70-8511).
*B- Proposed form of assignment(s) of Capital Funds
3(b) Agreement (Collateral Bonds) (filed as Exhibit B-3(b)
in File No. 70-8511).
*B-4 Proposed form of Indenture relating to the Tax-Exempt
Bonds (filed as Exhibit B-4 in File No. 70-8511).
**B-5 Proposed form of Reimbursement Agreement.
*B-6 Proposed form of Installment Sale Agreement (filed as
Exhibit B-6 in File No. 70-8511).
*B-7 Proposed form of Refunding Agreement (filed as Exhibit
B-8 in File No. 70-8511).
*B-8 Proposed form of Provisions relating to Insurance
(filed as Exhibit B-8 in File No. 70-8511).
*B-9 Description of Availability and Capital Funds
Agreement and assignments thereof (filed as Exhibit B-
9 in File No. 70-8511).
*B-10 Proposed form(s) of Underwriting or Purchase Agreement
for sale(s) of the Debentures (filed as Exhibit B-12
in File No. 70-8511).
*C-1 Registration Statement for Debt Securities and First
Mortgage Bonds relating to the Securities (filed in
File 333-06717) which included a combined prospectus
for $695,000,000 with respect to $160,000,000 of
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.
D Inapplicable.
E Inapplicable.
**F-1 Opinion of Wise Carter Child & Caraway, Professional
Association, counsel to Entergy Mississippi.
**F-2 Opinion of Thelen Reid & Priest LLP, counsel to System
Energy.
**F-3 Opinion of Thelen Reid & Priest LLP, counsel to
Entergy Corporation.
**F-4 Opinion of Friday, Eldredge & Clark, counsel to
Entergy Arkansas.
**F5 Opinion of Denise C. Redmann, Senior Counsel to
Entergy Louisiana, Entergy New Orleans and Entergy
Corporation.
**F-6 Opinion of Wise Carter Child & Caraway, Professional
Association, counsel to Entergy Mississippi.
**G Financial Data Schedule
H Suggested form of Notice of proposed transactions for
publication in the Federal Register.
________________________
* Incorporated herein by reference as indicated.
** To be filed by amendment.
**Section B. Financial Statements
Financial Statements of System Energy as of June 30, 2000
(reference is made to Exhibit G hereto).
Financial Statements of Entergy and subsidiaries, consolidated,
as of June 30, 2000.
Notes to financial statements of System Energy and Entergy
and subsidiaries included in the Annual Report on Form 10-K for
the fiscal year ended December 31, 1999 and the Quarterly Report
on Form 10-Q for the quarterly period ended June 30, 2000 (filed
in File Nos. 1-9067 and 1-11299, respectively, and incorporated
by reference).
Except as reflected in the Financial Statements, no material
changes not in the ordinary course of business have taken place
since June 30, 2000.
Item 7. Information as to Environmental Effects.
(a) As more fully described in Item 1, the proposed
transactions, subject to the jurisdiction of the Commission,
involve the financing activities of System Energy and, as such,
do not involve a major Federal action having a significant impact
on the human environment.
(b) Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned companies have duly caused
this Application-Declaration on Form U-1 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 September 22, 2000
