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File No. 70-8459
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 2 TO
FORM U-1 APPLICATION-DECLARATION
UNDER THE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
________________________________
CENTRAL AND SOUTH WEST SERVICES, INC.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
CENTRAL AND SOUTH WEST CORPORATION
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
(Name of companies filing this statement and address
of principal executive office)
_________________________________
CENTRAL AND SOUTH WEST CORPORATION
(Name of top registered holding company parent)
_________________________________
Shirley Briones
Treasurer
Central and South West Services, Inc.
1616 Woodall Rogers Freeway
Dallas, Texas 75202
Stephen J. McDonnell
Treasurer
Central and South West Corporation
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
Joris M. Hogan, Esq.
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
(Names and addresses of agents for service)
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Central and South West Services, Inc. ("CSWS"), a Texas corporation
and a wholly owned subsidiary of Central and South West Corporation ("CSW"), a
Delaware corporation and a registered holding company under the Public Utility
Holding Company Act of 1935, as amended (the "1935 Act"), together with CSW,
hereby files this Amendment No. 2 to the Form U-1 Application-Declaration in
File No. 70-8459 to amend Item 1 and file an Exhibit 7 thereto. In all other
respects, the Application-Declaration as previously filed and as heretofore
amended will remain the same.
Item 1. Description of Proposed Transactions.
Item 1 is hereby amended to add the following:
CSWS has now decided which of the methods of refinancing the Assets
it will pursue. CSWS has determined to refinance the Assets through a
floating rate bank financing rather than the alternative of a fixed rate
private placement. Based on market conditions, a floating rate bank financing
will allow CSWS to take advantage of lower short-term rates until market
conditions are appropriate to "lock in" a fixed rate through the use of an
interest rate swap.
CSWS previously stated that the interest rate swap agreement would
provide for automatic termination of CSWS's obligations to the counterparty
upon prepayment or termination of the notes. If a swap with automatic
termination is not available or economically appropriate, CSWS will enter into
a swap permitting termination at the option of CSWS and CSWS would exercise
such option upon prepayment or termination of the notes. CSWS's termination
of its obligations under the swap agreement may require CSWS to pay an
additional fee under the terms of the swap agreement.
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CSWS will apply the proceeds of the bank financing principally to
the reduction of CSWS's outstanding borrowings under the CSW Money Pool
("Money Pool"). CSWS is currently preparing a request to extend authority
under the Money Pool filing (File No. 70-8157) beyond March 31, 1995. In its
request for reauthorization, CSWS will address the appropriate level for its
Money Pool borrowing authority to the extent that proceeds received from the
bank financing discussed herein have been applied to reduce CSWS's outstanding
Money Pool borrowings.
Item 6. Exhibits and Financial Statements.
Item 6 hereby amended to file the following exhibit:
Exhibit 7 - Draft of term sheet for the loan agreement.
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S I G N A T U R E
- - - - - - - - -
Pursuant to the requirements of the Public Utility Holding Company
Act of 1935, as amended, the undersigned company has duly caused this document
to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: November 22, 1994
CENTRAL AND SOUTH WEST SERVICES, INC.
By: /s/ SHIRLEY BRIONES
Shirley Briones
Treasurer
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S I G N A T U R E
- - - - - - - - -
Pursuant to the requirements of the Public Utility Holding Company
Act of 1935, as amended, the undersigned company has duly caused this document
to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: November 22, 1994
CENTRAL AND SOUTH WEST CORPORATION
By: /s/ STEPHEN J. MCDONNELL
Stephen J. McDonnell
Treasurer
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INDEX OF EXHIBITS
EXHIBIT TRANSMISSION
NUMBER EXHIBIT METHOD
- ------- ------- ------------
7 Draft of term sheet for the loan agreement. Electronic
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EXHIBIT 7
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TERM SHEET
Borrower Central and South West Services, Inc.
Agent [Bank]
Purpose General corporate purposes, including the refinancing of
the headquarters building for Central and South West
Corporation.
Type and Amount
of Facility Term Loan Facility:
$60,000,000 term loan facility.
Final Maturity Seven years from the Closing Date.
Amortization The term loans shall be repaid in a single installment at
Final Maturity.
Availability A single drawing will be made on the Closing Date.
Fees
Interest At the Borrower's option, Base Rate, LIBOR and CD loans
will be available as follows:
A. Base Rate Option
Interest shall be at the Base Rate of [Bank or
Agent] plus the applicable Interest Margin,
calculated on the basis of the actual number of days
elapsed in a year of 365/366 days, payable in
arrears quarterly and at Final Maturity. The Base
Rate is defined as the higher of (a) the Federal
Funds Rate, as published by the Federal Reserve Bank
of New York plus 1/2 of 1%, and (b) the prime
commercial lending rate of [Bank or Agent], as
announced from time to time at its head office.
Base Rate drawings shall be made available on a
same-day basis if requested prior to 10:00 A.M.
Dallas time and shall be in minimum amounts of
$5,000,000 or any integral multiple of $1,000,000 in
excess thereof.
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B. LIBOR Option
Interest shall be determined for periods ("Interest
Periods") of one, two, three or six months (as
selected by the Borrower) and shall be at an annual
rate equal to the London Interbank Offered Rate
("LIBOR") for the corresponding deposits of U.S.
Dollars plus the applicable Interest Margin. LIBOR
will be determined by the Reference Lenders at the
start of each Interest Period. Interest will be
paid at the end of each Interest Period or
quarterly, whichever is earlier, and will be
calculated on the basis of the actual number of days
elapsed in a year of 360 days. LIBOR will be
adjusted for Regulation D reserve requirements to
the extent actually incurred. LIBOR drawings shall
require three business days' prior notice and shall
be in minimum amounts of $5,000,000 or any integral
multiple of $1,000,000 in excess thereof.
C. CD Option
Interest shall be determined for Interest Periods of
30, 60, 90 or 180 days (as selected by the Borrower)
and shall be at an annual rate equal to the Adjusted
Certificate of Deposit Rate ("CD Rate") of the
Reference Lenders for each Interest Period plus the
applicable interest margin. Interest will be paid at
the end of each Interest Period or quarterly,
whichever is earlier, and will be calculated on the
basis of the actual number of days elapsed in a year
of 360 days. The CD Rate is defined as the average
of the dealer bid rates for Certificates of Deposit
in U.S. Dollars as quoted by the Reference Lenders,
adjusted for Regulation D reserve requirements and
Federal Deposit Insurance Corporation premiums. CD
drawings shall require two business days' notice and
shall be in minimum amounts of $5,000,000 or any
integral multiple of $1,000,000 in excess thereof.
Default Interest Any principal of any loan that is not paid when due
(after applicable grace periods) will bear interest at a
rate per annum equal to 1% plus the rate otherwise
applicable to such loan, payable on demand.
Reference Lenders A representative sample of mutually acceptable Lenders
will be selected as Reference Lenders to establish LIBOR
and CD Rates.
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Interest Margins The applicable interest margins shall be as follows:
Base Rate Loans LIBOR Loans CD Loans
Voluntary
Prepayments Permitted in whole or in part without premium or penalty
(except for LIBOR and CD breakage costs, if any), subject
to limitations as to minimum amounts of prepayments.
Prepayments may be made upon three business days' prior
notice, in the case of LIBOR Loans, two business days'
prior notice, in the case of CD Loans, and same day
notice, in the case of Base Rate Loans.
Guarantees The Facility will be guaranteed by Central and South West
Corporation ("CSW").
Documentation The Facility will be subject to the negotiation,
execution and delivery of a mutually acceptable credit
agreement and related guarantee. Such credit agreement
will contain representations and warranties, funding and
yield protection provisions (including, without
limitation, a requirement for compensation for the cost
of compliance by the Lenders with capital adequacy and
similar requirements), conditions precedent, covenants,
events of default and other provisions customary for
transactions of this type, including (most materially)
the following:
A. Representations
and Warranties: Customary for facilities of this type, including but
not limited to:
(1) Corporate existence.
(2) Corporate and governmental
authorization; no contravention; binding
effect.
(3) Financial Information.
(4) No material adverse change except as previously
disclosed.
(5) No material litigation except as previously
disclosed.
B. Conditions
Precedent Customary for facilities of this type, including,
without limitation, (i) evidence that all necessary
governmental and regulatory approvals (including SEC
approval) have been obtained and remain in full
force and effect and (ii) receipt of favorable legal
opinions.
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C. Covenants Will include (without limitation):
1. Delivery of CSW consolidated quarterly
financial statements and CSW consolidated
audited annual financial statements.
2. Corporate existence, compliance with laws,
payment of taxes, maintenance of properties,
maintenance of books and records and
inspection.
3. Maintenance of insurance.
4. Limitation on mergers and acquisitions.
D. Events of
Default Will include (without limitation) payment,
misrepresentation, covenant, bankruptcy, ERISA,
judgments and cross-acceleration (where applicable
grace period has expired).
Assignments and
Participations Each Lender may assign all or a portion of its loans and
commitments under the Facility, or sell participations
therein, to another person or persons provided that each
such partial assignment shall be in a minimum amount
equal to $5,000,000 and shall be subject to certain
conditions (including, without limitation, the consent of
the Borrower and the Agent, which consents shall not be
unreasonably withheld or delayed) and (c) no purchaser of
a participation shall have the right to exercise or to
cause the selling Lender to exercise voting rights in
respect of the Facility (except as to certain basic
issues). In addition, any Lender shall have the right to
pledge obligations owed to such Lender to any Federal
Reserve Bank.
Expenses and
Indemnification Reasonable fees and expenses of (i) the Agent, relating
to the transaction and syndication thereof, including out
of pocket fees and expenses of counsel to the Agent for
preparation, negotiation and closing of, or any amendment
to, the documentation for the Facility, and (ii) the
Agent and the Lenders relating to the enforcement of
rights under the documentation for the Facility.
Majority Lenders More than 50%
Governing Law The law of the State of Texas
Borrower's Counsel Milbank, Tweed, Hadley & McCloy
