RELIANT ENERGY INC, S-3, 1999-09-02

RELIANT ENERGY INC
S-3, 1999-09-02
ELECTRIC SERVICES

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<PAGE>

As filed with the Securities and Exchange Commission on September 2, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

----------------
RELIANT ENERGY, INCORPORATED
(Exact name of registrant as specified in its charter)

Texas 74-0694415
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)

1111 Louisiana Hugh Rice Kelly
Houston, Texas 77002 Executive Vice President, General
(713) 207-3000 Counsel and
(Address, including zip code, and Corporate Secretary
telephone 1111 Louisiana
number, including area code, of Houston, Texas 77002
registrant's (713) 207-3000
principal executive offices) (Name, address, including zip code,
and telephone
number, including area code, of agent
for service)

----------------
Copy to:
Timothy S. Taylor
Baker & Botts, L.L.P.
910 Louisiana
One Shell Plaza
Houston, Texas 77002-4995
(713) 229-1234

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Approximate date of commencement of proposed sale to 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. [_]

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CALCULATION OF REGISTRATION FEE

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<TABLE>
<CAPTION>
Proposed
Title of each class of Proposed maximum aggregate Amount of
securities to be Amount to be maximum offering offering registration
registered registered(1) price per unit(2) price(1)(2) fee
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<S> <C> <C> <C> <C>
Debt Securities......... $1,000,000,000 100% $1,000,000,000 $278,000
</TABLE>
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(1) Or, if any Debt Securities are issued (i) with a principal amount
denominated in a foreign currency (including a composite currency), such
principal amount as shall result in an aggregate initial public offering
price the equivalent of $1,000,000,000 or (ii) at an original issue
discount, such greater principal amount as shall result in an aggregate
initial offering price of $1,000,000,000.

(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(o).

----------------
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.

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- -------------------------------------------------------------------------------
<PAGE>

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

Subject to completion, dated September 2, 1999.

Prospectus

[LOGO OF RELIANT ENERGY, INCORPORATED APPEARS HERE]

Reliant Energy, Incorporated
1111 Louisiana
Houston, Texas 77002
(713) 207-3000

$1,000,000,000
Debt Securities

---------------------------------------------

We may offer and sell up to $1,000,000,000
of our debt securities in one or more series
by using this prospectus. Our debt
securities will be unsecured and will be
either senior or subordinated obligations.
We will establish the terms for our debt
securities at the time we sell them and we
will describe them in one or more
supplements to this prospectus. You should
read this prospectus and the related
supplement carefully before you invest in
our debt securities. This prospectus may not
be used to offer and sell our debt
securities unless accompanied by a
prospectus supplement.

---------------------------------------------

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.

The date of this prospectus is , 1999.
<PAGE>

Table of Contents

<TABLE>
<S> <C>
About This Prospectus....................................................... 2
Where You Can Find More Information......................................... 3
Cautionary Statement Regarding Forward-Looking Information.................. 4
Reliant Energy.............................................................. 5
Ratio of Earnings to Fixed Charges.......................................... 5
Use of Proceeds............................................................. 6
Description of Our Debt Securities.......................................... 6
Plan of Distribution........................................................ 19
Validity of Securities...................................................... 21
Experts..................................................................... 21
</TABLE>

About This Prospectus

This prospectus is part of a registration statement we have filed with the
SEC using a "shelf" registration process. By using this process, we may offer
up to $1,000,000,000 of our debt securities in one or more offerings. This
prospectus provides you with a description of the debt securities we may
offer. Each time we offer debt securities, we will provide a supplement to
this prospectus. The prospectus supplement will describe the specific terms of
the offering. The prospectus supplement may also add, update or change the
information contained in this prospectus. Please carefully read this
prospectus, the applicable prospectus supplement and the information contained
in the documents we refer to in the "Where You Can Find More Information"
section of this prospectus.

References in this prospectus to the terms "we," "us" or other similar terms
mean Reliant Energy, Incorporated, unless the context clearly indicates
otherwise.

You should rely only on the information contained or incorporated by
reference in this prospectus and any accompanying prospectus supplement. We
have not authorized anyone else to provide you with any different information.
If anyone provides you with different or inconsistent information, you should
not rely on it. We are not making an offer to sell debt securities in any
jurisdiction where the offer or sale is not permitted. The information
contained in this prospectus is current only as of the date of this
prospectus.

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<PAGE>

Where You Can Find More Information

We file reports and other information with the SEC. You may read and copy
any document we file with the SEC at the SEC's Public Reference Room located
at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional offices
of the SEC located at 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511, and at 7 World Trade Center, Suite 1300, New York, New York 10048.
You may obtain further information regarding the operation of the SEC's Public
Reference Room by calling the SEC at 1-800-SEC-0330. Our filings are also
available to the public on the SEC's Internet site located at
http://www.sec.gov. In addition, you may inspect our reports at the offices of
the New York Stock Exchange, Inc. at 20 Broad Street, New York, New York 10005
and at the offices of the Chicago Stock Exchange at 440 South LaSalle Street,
Chicago, Illinois 60605.

The SEC allows us to "incorporate by reference" into this prospectus
information we file with the SEC. This means we can disclose important
information to you by referring you to the documents containing the
information. The information we incorporate by reference is considered to be
part of this prospectus, unless we update or supersede that information by the
information contained in this prospectus, a prospectus supplement or
information that we file subsequently that is incorporated by reference into
this prospectus. We are incorporating by reference into this prospectus the
following documents that we have filed with the SEC, and our future filings
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the offering of the debt securities is completed:

. our Annual Report on Form 10-K for the fiscal year ended December 31,
1998,

. our Current Report on Form 8-K dated January 29, 1999 and filed with the
SEC on February 1, 1999,

. our Current Report on Form 8-K dated February 25, 1999 and filed with the
SEC on February 26, 1999,

. our Quarterly Report on Form 10-Q for the quarterly period ended March 31,
1999,

. our Current Report on Form 8-K dated July 7, 1999 and filed with the SEC
on July 7, 1999, and

. our Quarterly Report on Form 10-Q for the quarterly period ended June 30,
1999.

This prospectus is part of a registration statement we have filed with the
SEC relating to our debt securities. As permitted by SEC rules, this
prospectus does not contain all of the information included in the
registration statement and the accompanying exhibits and schedules we file
with the SEC. You should read the registration statement and the exhibits and
schedules for more information about us and our debt securities. The
registration statement, exhibits and schedules are also available at the SEC's
Public Reference Room or through its Internet site.

You may also obtain a copy of our filings with the SEC at no cost, by
writing to or telephoning us at the following address:

Reliant Energy, Incorporated
1111 Louisiana
Houston, Texas 77002
Attn: Corporate Secretary
(713) 207-3000

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<PAGE>

Cautionary Statement Regarding Forward-Looking Information

This prospectus, including the information we incorporate by reference,
contains statements that are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. You can identify our
forward-looking statements by the words "anticipate," "estimate," "expect,"
"forecast," "goal," "objective," "projection" or other similar words.

We have based our forward-looking statements on our management's beliefs and
assumptions based on information available to our management at the time the
statements are made. We caution you that assumptions, beliefs, expectations,
intentions and projections about future events may and often do vary
materially from actual results. Therefore, we cannot assure you that actual
results will not differ materially from those expressed or implied by our
forward-looking statements.

The following list identifies some of the factors that could cause actual
results to differ from those expressed or implied by our forward-looking
statements:

. state and federal legislative and regulatory initiatives that affect cost
and investment recovery, have an impact on rate structures and affect the
speed and degree to which competition enters the electric and natural gas
industries,

. changes to our electric utility operations required by or in response to
the Texas Electric Choice Plan,

. industrial, commercial and residential growth in our service territories,

. the weather and other natural phenomena,

. the timing and extent of changes in commodity prices and interest rates,

. changes in environmental and other laws and regulations to which we and
our subsidiaries are subject or other external factors over which we have
no control,

. the results of financing efforts,

. growth in opportunities for our subsidiaries and diversified operations,

. risks incidental to our overseas operations, including the effects of
fluctuations in foreign currency exchange rates,

. the effect of our accounting policies,

. the timing and effect of our acquisition of an interest in N.V.
Energieproduktiebedrijf UNA, and

. other factors we discuss in this prospectus and our other filings with
the SEC.

-4-
<PAGE>

Reliant Energy

We are a diversified international energy services company. Reliant Energy
HL&P, our electric utility division, provides electric utility services to
approximately 1.6 million customers in the City of Houston, Texas, and
surrounding areas of the Texas Gulf Coast. Reliant Energy Resources Corp.
(Resources), our largest subsidiary, is a natural gas utility serving over 2.8
million customers in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and
Texas. Resources, through its subsidiaries, is also a major interstate natural
gas pipeline company and a provider of energy marketing services.

Our other principal subsidiaries include:

. Reliant Energy International, Inc., which participates in the
privatization of foreign generating and distribution facilities and the
development and acquisition of foreign independent power projects, and

. Reliant Energy Power Generation, Inc., which engages in the acquisition,
development, operation and sale of capacity and energy from, domestic and
certain international non-utility power generation facilities.

Subject to certain limited exceptions, we are exempt from regulation as a
public utility holding company pursuant to Section 3(a)(2) of the Public
Utility Holding Company Act of 1935.

Ratio of Earnings to Fixed Charges

The following table sets forth our ratios of earnings from continuing
operations to fixed charges for each of the periods indicated:

<TABLE>
<CAPTION>
Six Months
Ended
June 30, Year Ended December 31,
------------ ---------------------------
1999(3) 1998 1998(4) 1997 1996 1995 1994
------- ---- ------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings from continuing
operations to fixed charges before
cumulative effect of change in
accounting (1) (2)..................... -- 1.20 -- 2.41 2.76 2.71 2.89
</TABLE>
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(1) We do not believe that the ratios for the six-month periods are
necessarily indicative of the ratios for the twelve-month periods due to
the seasonal nature of our business.
(2) Includes the results of Resources from the date of its acquisition, August
6, 1997, which was accounted for under the purchase method.
(3) Our earnings in the first six months of 1999 were inadequate to cover
fixed charges by approximately $142 million. This deficiency resulted from
the pre-tax $400 million non-cash, unrealized accounting loss recorded for
our 7% Automatic Common Exchange Securities, due 2000 (ACES). Excluding
the effect of the after-tax non-cash, unrealized accounting loss of $260
million, the ratio of earnings from continuing operations to fixed charges
would have been 1.90.
(4) Our earnings for the year ended December 31, 1998 were inadequate to cover
fixed charges by approximately $181 million. This deficiency resulted from
the pre-tax $1.2 billion non-cash, unrealized accounting loss recorded for
our ACES. Excluding the effect of the after-tax non-cash, unrealized
accounting loss of $764 million, the ratio of earnings from continuing
operations to fixed charges would have been 2.77.

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<PAGE>

Use of Proceeds

Unless we inform you otherwise in the prospectus supplement, we anticipate
using any net proceeds from the sale of the debt securities offered by this
prospectus for general corporate purposes. These purposes may include, but are
not limited to:

. working capital,

. capital expenditures,

. acquisitions, and

. the repayment or refinancing of our indebtedness, including inter-company
indebtedness.

Description of Our Debt Securities

The debt securities offered by this prospectus will be either senior debt
securities or subordinated debt securities. We will issue senior debt
securities under an indenture we will enter into with the trustee named in the
prospectus supplement. We will issue subordinated debt securities under an
indenture we will enter into with the trustee named in the prospectus
supplement. We refer to the senior indenture and the subordinated indenture in
this prospectus collectively as the "indentures." We have filed the forms of
the indentures with the SEC as exhibits to the registration statement covering
the debt securities offered by this prospectus. We have summarized selected
provisions of the indentures and the debt securities below. This summary is
not complete and is qualified in its entirety by reference to the indentures.

We may issue debt securities from time to time in one or more series under
the indentures. We will describe the particular terms of each series of debt
securities we offer in a supplement to this prospectus. You should carefully
read the summary below, the applicable prospectus supplement and the
provisions of the relevant indenture that may be important to you before
investing in our debt securities.

The provisions of each of the indentures are substantially identical in
substance, except that Article Sixteen of the subordinated indenture provides
for the subordination of the subordinated debt securities, and the senior
indenture has no counterpart for that Article. We describe the subordination
provisions of the subordinated indenture in the "Subordination Under the
Subordinated Indenture" section of this prospectus.

We have included cross-references in the summary below to refer you to the
section numbers of the indentures we are describing. These sections numbers
are the same for both of the indentures, unless we state otherwise.

The Terms of the Debt Securities

We may issue debt securities in separate series from time to time under each
of the indentures. The total principal amount of debt securities that may be
issued under the indentures is unlimited. We may limit the maximum total
principal amount for the debt securities of any series. However, any limit may
be increased by resolution of our board of directors. (Section 301) We will
establish the terms of each series of debt securities, which may not be
inconsistent with the related indenture, in a supplemental indenture. The
senior debt securities will rank equally with all of our other unsecured and
unsubordinated indebtedness. The subordinated debt securities will rank junior
and be subordinate to all of our senior indebtedness as we describe in the
"Subordination Under the Subordinated Indenture" section of this prospectus.

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<PAGE>

We will describe the specific terms of the series of debt securities being
offered in a supplement to this prospectus. These terms will include some or
all of the following:

. the title of the debt securities,

. whether the debt securities are senior debt securities or subordinated
debt securities,

. the specific indenture under which the debt securities will be issued,

. any limit on the total principal amount of the debt securities,

. the date or dates on which the principal of the debt securities will be
payable or the method used to determine or extend those dates,

. the interest rate or rates of the debt securities, if any, or the method
used to determine the rate or rates,

. the date or dates from which interest will accrue on the debt securities,
or the method used for determining those dates,

. the interest payment dates and the regular record dates for interest
payments, if any, or the method used to determine those dates,

. the basis for calculating interest if other than a 360-day year of twelve
30-day months,

. the place or places where:

. payments of principal, premium, if any, and interest on the debt
securities will be payable,

. the debt securities may be presented for registration of transfer or
exchange, and

. notices and demands to or upon us relating to the debt securities may
be made,

. any provisions for redemption of the debt securities,

. any provisions that would allow or obligate us to redeem or purchase the
debt securities prior to their maturity,

. the denominations in which we will issue the debt securities, if other
than denominations of an integral multiple of $1,000,

. any provisions that would determine the amount of principal, premium, if
any, or interest on the debt securities by reference to an index or
pursuant to a formula,

. the currency, currencies or currency units in which the principal,
premium, if any, and interest on the debt securities will be payable, if
other than $US, and the manner for determining the equivalent principal
amount in $US,

. any provisions for the payment of principal, premium, if any, and
interest on the debt securities in one or more currencies or currency
units other than those in which the debt securities are stated to be
payable,

. the percentage of the principal amount at which the debt securities will
be issued and, if other than 100%, the portion of the principal amount of
the debt securities which will be payable if the maturity of the debt
securities is accelerated, or the method for determining such portion,

. if the principal amount to be paid at the stated maturity of the debt
securities is not determinable as of one or more dates prior to the
stated maturity, the amount which will be deemed to be the principal
amount as of any such date for any purpose, including the principal
amount which will be due and payable upon any maturity other than the
stated maturity or which will be deemed to be outstanding as of any such
date, or, in any such case, the manner in which the deemed principal
amount is to be determined,

-7-
<PAGE>

. any variation of the defeasance and covenant defeasance sections of the
relevant indenture and the manner in which our election to defease the
debt securities will be evidenced, if other than by a board resolution,

. whether any of the debt securities will initially be issued in the form
of a temporary global security and the provisions for exchanging a
temporary global security for definitive debt securities,

. whether any of the debt securities will be issued in the form of one or
more global securities and, if so:

. the depositories for the global securities,

. the form of any additional legends to be borne by the global
securities,

. the circumstances under which the global securities may be exchanged,
in whole or in part, for debt securities registered, and

. whether and under what circumstances a transfer of the global
securities may be registered in the names of persons other than the
depositary for the global securities or its nominee,

. whether the interest rate of the debt securities may be reset,

. whether the stated maturity of the debt securities may be extended,

. any addition to or change in the events of default for the debt
securities and any change in the right of the trustee or the holders of
the debt securities to declare the principal amount of the debt
securities due and payable,

. any addition to or change in the covenants in the relevant indenture,

. any additions or changes to the relevant indenture necessary to issue the
debt securities in bearer form, registrable or not registrable as to
principal, and with or without interest coupons,

. the appointment of any paying agents for the debt securities, if other
than us,

. the terms of any right to convert or exchange the debt securities into
any other securities or property,

. the terms and conditions, if any, securing the debt securities,

. any restriction or condition on the transferability of the debt
securities, and

. any other terms of the debt securities consistent with the relevant
indenture. (Section 301)

We may sell the debt securities, including original issue discount
securities, at a substantial discount below their stated principal amount. If
there are any special United States federal income tax considerations
applicable to debt securities we sell at an original discount, we will
describe them in the prospectus supplement. In addition, we will describe in
the prospectus supplement any special United States federal income tax
considerations and any other special considerations for any debt securities we
sell which are denominated in a currency or currency unit other than $US.

Form, Exchange and Transfer of the Debt Securities

We will issue the debt securities in registered form, without coupons.
Unless we inform you otherwise in the prospectus supplement, we will only
issue debt securities in denominations of integral multiples of $1,000.
(Section 302)

Holders will generally be able to exchange debt securities for other debt
securities of the same series with the same total principal amount and the
same terms but in different authorized denominations. (Section 305)

-8-
<PAGE>

Holders may present debt securities for exchange or for registration of
transfer at the office of the security registrar or at the office of any
transfer agent we designate for that purpose. The security registrar or
designated transfer agent will exchange or transfer the debt securities if it
is satisfied with the documents of title and identity of the person making the
request. We will not charge a service charge for any exchange or registration
of transfer of debt securities. However, we may require payment of a sum
sufficient to cover any tax or other governmental charge payable for the
registration of transfer or exchange. Unless we inform you otherwise in the
prospectus supplement, we will appoint the trustee as security registrar. We
will identify any transfer agent in addition to the security registrar in the
prospectus supplement. (Section 305) At any time we may:

. designate additional transfer agents,

. rescind the designation of any transfer agent, or

. approve a change in the office of any transfer agent.

However, we are required to maintain a transfer agent in each place of payment
for the debt securities at all times. (Sections 305 and 1002)

In the event we elect to redeem a series of debt securities, neither we nor
the applicable trustee will be required to register the transfer or exchange
of any debt security of that series:

. during the period beginning at the opening of business 15 days before the
day we mail the notice of redemption for the series and ending at the
close of business on the day the notice is mailed, or

. if we have selected the series for redemption, in whole or in part,
except for the unredeemed portion of the series. (Section 305)

Global Securities

Unless we inform you otherwise in the prospectus supplement, some or all of
the debt securities of any series may be represented, in whole or in part, by
one or more global securities. The global securities will have a total
principal amount equal to the debt securities they represent. Unless we inform
you otherwise in the prospectus supplement, each global security representing
debt securities will be deposited with, or on behalf of, The Depository Trust
Company, referred to as "DTC," or any other successor depository we may
appoint. We refer to DTC or the other depository in this prospectus as the
"depositary." Each global security will be registered in the name of the
depositary or its nominee. Each global security will bear a legend referring
to the restrictions on exchange and registration of transfer of global
securities that we describe below and any other matters required by the
relevant indenture. Unless we inform you otherwise in the prospectus
supplement, we will not issue debt securities in definitive form.

Global securities may not be exchanged, in whole or in part, for debt
securities registered, and no transfer of a global security, in whole or in
part, may be registered in the name of any person other than the depositary
for the global security or any nominee of the depositary unless:

. the depositary has notified us that it is unwilling or unable to continue
as depositary for the global security or has ceased to be qualified to
act as depositary as required by the indentures,

. an event of default with respect to the global security has occurred and
is continuing,

. we determine in our sole discretion that the global security will be so
exchangeable or transferable, or

. any other circumstances in addition to or in lieu of those described
above that we may describe in the prospectus supplement.

All debt securities issued in exchange for a global security or any portion of
a global security will be registered in the names directed by the depositary.
(Sections 204 and 305)

-9-
<PAGE>

Regarding 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 under Section 17A of the Exchange Act.

DTC holds securities that its participants deposit with DTC. DTC also
facilitates the settlement among participants of securities transactions, such
as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in 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 some other organizations.

DTC is owned by a number of 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 DTC's book-entry 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, referred to as indirect
participants. The rules applicable to DTC and its participants are on file
with the SEC.

Upon our issuance of debt securities represented by a global security,
purchases of debt securities under the DTC system must be made by or through
direct participants, which will receive a credit for the debt securities on
DTC's records. The ownership interest of each actual purchaser of each debt
security, referred to as a beneficial owner, is in turn to be recorded on the
direct and indirect participants' records. Beneficial owners will not receive
written confirmation from DTC of their purchase. However, 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 interests in the debt securities are to be
accomplished by entries made on the books of participants acting on behalf of
beneficial owners. Beneficial owners will not receive certificates
representing their ownership interests in debt securities, except in the event
that use of the book-entry system for the debt securities is discontinued. The
laws of some states require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such laws may impair
the ability to transfer beneficial interests in a global security.

So long as the depositary for the global security, or its nominee, is the
registered owner of the global security, the depositary or its nominee, as the
case may be, will be considered the sole owner or holder of the debt
securities represented by the global security for all purposes under the
indentures. Except as described above, beneficial owners will not:

. be entitled to have debt securities represented by the global security
registered in their names,

. receive or be entitled to receive physical delivery of debt securities in
definitive form, and

. be considered the owners or holders thereof under the indentures.

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<PAGE>

To facilitate subsequent transfers, all debt securities deposited by
participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of debt securities with DTC and their registration in
the name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual beneficial owners of the debt securities. DTC's
records reflect only the identity of the direct participants to whose accounts
the debt securities are credited, which may or may not be the beneficial
owners. The participants will remain responsible for keeping account of their
holdings on behalf of their customers. Conveyance of notices and other
communications by DTC to direct participants, by direct participants to
indirect participants, and by direct participants and indirect participants to
beneficial owners will be governed by arrangements among them, subject to any
statutory or regulatory requirements as may be in effect from time to time.

Neither DTC nor Cede & Co. will consent or vote with respect to debt
securities. Under its usual procedures, DTC mails an omnibus proxy to us as
soon as possible after the record date. The omnibus proxy assigns Cede & Co.'s
consenting or voting rights to those direct participants to whose accounts the
debt securities are credited on the record date, identified in a listing
attached to the omnibus proxy.

We will make payments of principal, premium, if any, and interest on the
debt securities represented by the global security registered in the name of
the depositary or its nominee through the trustee under the relevant indenture
or a paying agent, which may also be the trustee under the relevant indenture,
to the depositary or its nominee, as the case may be, as the registered owner
of the global security. Neither we, the trustees, nor the paying agent will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of the global
security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.

We have been advised that DTC will credit direct participants' accounts on
the payable 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
the payable date. Payments by participants to beneficial owners will be
governed by standing instructions and customary practices, as in the case with
securities held 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 paying agent, or us, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal,
premium, if any, and interest to DTC is either our responsibility or the
responsibility of the paying agent. Disbursement of these payments to direct
participants is the responsibility of DTC. Disbursement of these payments to
the beneficial owners is the responsibility of direct and indirect
participants.

We cannot assure you that DTC will distribute payments on the debt
securities made to DTC or its nominee as the registered owner or any
redemption or other notices to the participants, or that the participants or
others will distribute the payments or notices to the beneficial owners, or
that they will do so on a timely basis, or that DTC will serve and act in the
manner described in this prospectus. Beneficial owners should make appropriate
arrangements with their broker or dealer regarding distribution of information
regarding the debt securities that may be transmitted by or through DTC.

DTC management is aware that some computer applications, systems, and the
like for processing data, referred to as "systems," that are dependent upon
calendar dates, including dates before, on, and after January 1, 2000, may
encounter "Y2K problems." DTC has informed its participants and other members
of the financial community that it has developed and is implementing a program
so that its systems, as the same relate to the timely payment of
distributions, including principal and income payments, to securityholders,
book-entry deliveries, and settlement of trades within DTC continue to
function appropriately. This program includes a technical assessment and a
remediation plan, each of which is complete. Additionally, DTC's plan includes
a testing phase, which is expected to be completed within appropriate time
frames.

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However, DTC's ability to properly perform its services is also dependent
upon other parties, including but not limited to issuers and their agents, as
well as third party vendors from whom DTC licenses software and hardware, and
third party vendors on whom DTC relies for information or the provision of
services, including telecommunication and electrical utility service
providers, among others. DTC has informed the industry that it is contacting,
and will continue to contact, third party vendors from whom DTC acquires
services to:

. impress upon them the importance of such services being Y2K compliant, and

. determine the extent of their efforts for Y2K remediation, and, as
appropriate, testing, of their services.

In addition, DTC is in the process of developing such contingency plans as it
deems appropriate.

According to DTC, the foregoing information with respect to DTC has been
provided to the industry for informational purposes only and is not intended
to serve as a representation, warranty, or contract modification of any kind.

We have obtained the information in this section concerning DTC and the
DTC's book-entry system from sources that we believe are reliable. However, we
take no responsibility for the accuracy of this information.

Payment and Paying Agents

Unless we inform you otherwise in the prospectus supplement, we will pay
interest on the debt securities to the persons in whose names the debt
securities are registered at the close of business on the regular record date
for each interest payment. However, unless we inform you otherwise in the
prospectus supplement, we will pay the interest payable on the debt securities
at their stated maturity to the persons we pay the principal amount of the
debt securities. The initial payment of interest on any series of debt
securities issued between a regular record date and the related interest
payment date will be payable in the manner provided by the terms of the
series, which we will describe in the prospectus supplement. (Section 307)

Unless we inform you otherwise in the prospectus supplement, we will pay
principal, premium, if any, and interest on the debt securities at the offices
of the paying agents we designate. However, except in the case of a global
security, we may pay interest by:

. check mailed to the address of the person entitled to the payment as it
appears in the security register, or

. by wire transfer in immediately available funds to the place and account
designated in writing by the person entitled to the payment as specified
in the security register.

We will designate ourselves as the sole paying agent for the debt securities
unless we inform you otherwise in the prospectus supplement. If we initially
designate any other paying agents for a series of debt securities, we will
identify them in the prospectus supplement. At any time, we may designate
additional paying agents or rescind the designation of any paying agents.
However, we are required to maintain a paying agent in each place of payment
for the debt securities at all times. (Sections 307 and 1002)

Any money deposited with the applicable trustee or any paying agent for the
payment of principal, premium, if any, and interest on the debt securities
that remains unclaimed for two years after the date the payments became due,
may be repaid to us upon our request. After we have been repaid, holders
entitled to those payments may only look to us for payment as our unsecured
general creditors. The trustees and any paying agents will not be liable for
those payments after we have been repaid. (Section 1003)

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Covenants

We will describe any restrictive covenants for any series of debt securities
in the prospectus supplement.

Consolidation, Merger and Sale of Assets

Unless we inform you otherwise in the prospectus supplement, we may not
consolidate with or merge into, or convey, transfer or lease our properties
and assets substantially as an entirety, to any person, referred to as a
"successor person," and we may not permit any person to consolidate with or
merge into, or convey, transfer or lease its properties and assets
substantially as an entirety to us, unless:

. the successor person, if any, is a corporation, partnership, trust or
other entity organized and validly existing under the laws of any
domestic jurisdiction,

. the successor person assumes our obligations with respect to the debt
securities and the relevant indenture,

. immediately after giving effect to the transaction, no event of default,
and no event which, after notice or lapse of time or both, would become
an event of default, would occur and be continuing, and

. we have delivered to the trustee the certificates and opinions required
under the relevant indenture. (Section 801)

Events of Default

Unless the context clearly indicates otherwise, we use the terms "indenture"
and "trustee" in this subsection to mean the relevant indenture and the
applicable trustee with respect to any series of debt securities we may offer.

Unless we inform you otherwise in the prospectus supplement, each of the
following will be an event of default under the indenture for a series of debt
securities:

. our failure to pay principal or premium, if any, on that series when due,

. our failure to pay any interest on that series for 30 days,

. our failure to deposit any sinking fund payment, when due, relating to
that series,

. our failure to perform, or our breach in any material respect of, any
other covenant or warranty in the indenture, other than a covenant or
warranty included in the indenture solely for the benefit of another
series of debt securities, for 90 days after either the trustee or
holders of at least 25% in principal amount of the outstanding debt
securities of that series have given us written notice of the breach in
the manner required by the indenture,

. specified events involving bankruptcy, insolvency or reorganization, and

. any other event of default we may provide for that series,

provided, however, that no event described in the fourth, fifth and sixth
bullet points above will be an event of default until an officer of the
trustee, assigned to and working in the trustee's corporate trust department,
has actual knowledge of the event or until the trustee receives written notice
of the event at its corporate trust office, and the notice refers to the debt
securities generally, us or the indenture. (Section 501)

If the principal, premium, if any, or interest on any series of debt
securities is payable in a currency other than the $US and the currency is not
available to us for making payments due to the imposition of exchange controls
or other circumstances beyond our control, we may satisfy our obligations to
holders of the debt securities by making payment in $US in an amount equal to
the $US equivalent of the amount payable in the

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other currency. This amount will be determined by the trustee by reference to
the noon buying rate in The City of New York for cable transfers for the other
currency, referred to as the "exchange rate," as reported or otherwise made
available by the Federal Reserve Bank of New York on the date of the payment,
or, if the exchange rate is not then available, on the basis of the most
recently available exchange rate. Any payment made in $US under these
circumstances will not be an event of default under the indentures. (Section
501)

If an event of default for a series of debt securities occurs and is
continuing, either the trustee or the holders of at least 25% in principal
amount of the outstanding debt securities of that series may declare the
principal amount of the debt securities of that series due and immediately
payable. In order to declare the principal amount of the series of debt
securities due and immediately payable, the trustee or the holders must
deliver a notice that satisfies the requirements of the indenture. Upon a
declaration by the trustee or the holders, we will be obligated to pay the
principal amount of the series of debt securities.

This right does not apply if:

. an event of default described in the fourth or fifth bullet points above
occurs, or

. an event of default described in the sixth bullet point above that
applies to all outstanding debt securities occurs.

If any of these events of default occur and is continuing, either the trustee
or holders of at least 25% in principal amount of all of the debt securities
then outstanding, treated as one class, may declare the principal amount of
all of the debt securities then outstanding to be due and payable immediately.
In order to declare the principal amount of the debt securities due and
immediately payable, the trustee or the holders must deliver a notice that
satisfies the requirements of the indenture. Upon a declaration by the trustee
or the holders, we will be obligated to pay the principal amount of the debt
securities.

After any declaration of acceleration of a series of debt securities, but
before a judgment or decree for payment, the holders of a majority in
principal amount of the outstanding debt securities of that series may, under
certain circumstances, rescind and annul the declaration of acceleration if
all events of default, other than the non-payment of principal have been cured
or waived as provided in the indenture. (Section 502) For information as to
waiver of defaults, please refer to the "Modification and Waiver" section
below.

If an event of default occurs and is continuing, the trustee will generally
have no obligation to exercise any of its rights or powers under the indenture
at the request or direction of any of the holders, unless the holders offer
reasonable indemnity to the trustee. (Section 603) The holders of a majority
in principal amount of the outstanding debt securities of any series will
generally have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the trustee or exercising any trust
or power conferred on the trustee for the debt securities of that series,
provided that:

. the direction is not in conflict with any law or the indenture,

. the trustee may take any other action it deems proper which is not
inconsistent with the direction, and

. the trustee will generally have the right to decline to follow the
direction if an officer of the trustee determines, in good faith, that
the proceeding would involve the trustee in personal liability or would
otherwise be contrary to applicable law. (Section 512)

A holder of a debt security of any series may only pursue a remedy under the
indenture if:

. the holder gives the trustee written notice of a continuing event of
default for that series,

. holders of at least 25% in principal amount of the outstanding debt
securities of that series make a written request to the trustee to pursue
that remedy,

. the holder offers reasonable indemnity to the trustee,

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. the trustee fails to pursue that remedy within 60 days after receipt of
the request, and

. during that 60-day period, the holders of a majority in principal amount
of the debt securities of that series do not give the trustee a direction
inconsistent with the request. (Section 507)

However, these limitations do not apply to a suit by a holder of a debt
security demanding payment of the principal, premium, if any, or interest on a
debt security on or after the date the payment is due. (Section 508)

We will be required to furnish to the trustee annually a statement by some
of our officers regarding our performance or observance of any of the terms of
the indenture and, specifying all of our known defaults, if any. (Section
1004)

Modification and Waiver

We may enter into one or more supplemental indentures with the trustee
without the consent of the holders of the debt securities in order to:

. evidence the succession of another corporation to us, or successive
successions and the assumption of our covenants, agreements and
obligations by a successor,

. add to our covenants for the benefit of the holders or to surrender any
of our rights or powers,

. add events of default for any series of debt securities,

. add or change any provisions of the indentures to the extent necessary to
issue debt securities in bearer form,

. add to, change or eliminate any provision of the indenture applying to
one or more series of debt securities, provided that if such action
adversely affects the interests of any holders of debt securities of any
series, the addition, change or elimination will become effective with
respect to that series only when no security of that series remains
outstanding,

. convey, transfer, assign, mortgage or pledge any property to or with the
trustee or to surrender any right or power conferred upon us by the
indenture,

. establish the form or terms of any series of debt securities,

. provide for uncertificated securities in addition to certificated
securities,

. evidence and provide for successor trustees or to add or change any
provisions to the extent necessary to appoint a separate trustee or
trustees for a specific series of debt securities,

. correct any ambiguity, defect or inconsistency under the indenture,
provided that such action does not adversely affect the interests of the
holders of debt securities of any series,

. supplement any provisions of the indenture necessary to defease and
discharge any series of debt securities, provided that such action does
not adversely affect the interests of the holders of any series of debt
securities,

. comply with the rules or regulations of any securities exchange or
automated quotation system on which any debt securities are listed or
traded, or

. add, change or eliminate any provisions of the indenture in accordance
with any amendments to the Trust Indenture Act, provided that the action
does not adversely affect the rights or interests of any holder of debt
securities. (Section 901)

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We may enter into one or more supplemental indentures with the trustee in
order to add to, change or eliminate provisions of the indenture or to modify
the rights of the holders of one or more series of debt securities if we
obtain the consent of the holders of a majority in principal amount of the
outstanding debt securities of each series affected by the supplemental
indenture, treated as one class. However, without the consent of the holders
of each outstanding debt security affected by the supplemental indenture, we
may not enter into a supplemental indenture that:

. changes the stated maturity of the principal of, or any installment of
principal of or interest on, any debt security, except to the extent
permitted by the indenture,

. reduces the principal amount of, or any premium or interest on, any debt
security,

. reduces the amount of principal of an original issue discount security or
any other debt security payable upon acceleration of the maturity
thereof,

. changes the place or currency of payment of principal, premium, if any,
or interest,

. impairs the right to institute suit for the enforcement of any payment on
any debt security,

. reduces the percentage in principal amount of outstanding debt securities
of any series, the consent of whose holders is required for modification
or amendment of the indenture,

. reduces the percentage in principal amount of outstanding debt securities
of any series necessary for waiver of compliance with certain provisions
of the indenture or for waiver of certain defaults,

. makes certain modifications to such provisions with respect to
modification and waiver,

. makes any change that adversely affects the right to convert or exchange
any debt security or decrease the conversion or exchange rate or
increases the conversion price of any convertible or exchangeable debt
security, or

. changes the terms and conditions pursuant to which any series of debt
securities that are secured in a manner adverse to the holders of the
debt securities. (Section 902)

Holders of a majority in principal amount of the outstanding debt securities
of any series may waive past defaults or compliance with restrictive
provisions of the indenture. However, the consent of holders of each
outstanding debt security of a series is required to:

. waive any default in the payment of principal, premium, if any, or
interest, or

. waive any covenants and provisions of the indenture that may not be
amended without the consent of the holder of each outstanding security of
the series affected. (Sections 513 and 1006)

In order to determine whether the holders of the requisite principal amount
of the outstanding debt securities have taken an action under the indenture as
of a specified date:

. the principal amount of an original issue discount security that will be
deemed to be outstanding will be the amount of the principal that would
be due and payable as of such date upon acceleration of the maturity to
such date,

. if, as of such date, the principal amount payable at the stated maturity
of a debt security is not determinable, for example, because it is based
on an index, the principal amount of such debt security deemed to be
outstanding as of such date will be an amount determined in the manner
prescribed for such debt security,

. the principal amount of a debt security denominated in one or more
foreign currencies or currency units that will be deemed to be
outstanding will be the $US equivalent, determined as of such date in the
manner prescribed for such debt security, of the principal amount of such
debt security or, in the case of a debt security described in the two
preceding bullet points, of the amount described above, and

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. debt securities owned by us or any other obligor upon the debt securities
or any of their affiliates will be disregarded and deemed not to be
outstanding.

Some debt securities, including those for whose payment or redemption money
has been deposited or set aside in trust for the holders and those that have
been fully defeased pursuant to Section 1402, will not be deemed to be
outstanding. (Section 101)

We will generally be entitled to set any day as a record date for
determining the holders of outstanding debt securities of any series entitled
to give or take any direction, notice, consent, waiver or other action under
the indenture. In limited circumstances, the trustee will be entitled to set a
record date for action by holders. If a record date is set for any action to
be taken by holders of a particular series, the action may be taken only by
persons who are holders of outstanding debt securities of that series on the
record date. To be effective, the action must be taken by holders of the
requisite principal amount of the debt securities within a specified period
following the record date. For any particular record date, this period will be
180 days or such shorter period as may we may specify, or the trustee may
specify, if it set the record date. This period may be shortened or lengthened
by not more than 180 days. (Section 104)

Subordination Under the Subordinated Indenture

We have defined some of the terms we use in this subsection at the end of
this subsection.

The subordinated debt securities issued under the subordinated indenture
will be unsecured and junior in right of payment to all of our senior
indebtedness. This means we will not make a payment on the subordinated debt
securities if:

. any senior indebtedness is not paid when due, any applicable grace period
for the payment default has ended and the payment default has not been
cured or waived or ceased to exist, or

. the maturity of any senior indebtedness has been accelerated because of a
default and that acceleration has not been rescinded.

If our assets are distributed to our creditors upon our dissolution,
winding-up or liquidation, whether voluntarily or involuntarily or in
bankruptcy, insolvency, receivership, reorganization or other similar
proceedings, all principal, premium, if any, interest and any other amounts
due or to become due on all senior indebtedness must be paid in full before
the holders of the subordinated debt securities are entitled to receive or
retain any payment.

"Debt" in the subordinated indenture means, with respect to any person at
any date of determination, without duplication:

. all indebtedness for borrowed money,

. all obligations evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses,

. all obligations under letters of credit or bankers' acceptances or other
similar instruments, or related reimbursement obligations, issued on the
account of such person,

. all obligations to pay the deferred purchase price of property or
services, except some trade payables,

. all obligations as lessee under capitalized leases,

. all debt of others secured by a lien on any asset of such person, whether
or not the debt is assumed by the person, provided that, for purposes of
determining the amount of any debt of the type described in this clause,
if recourse with respect to the debt is limited to the asset, the amount
of the debt is limited to the lesser of the fair market value of the
asset or the amount of the debt, and

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. to the extent not to otherwise included in this definition, all
obligations for claims in respect of derivative products, including
interest rate, foreign exchange rate and commodity prices, forward
contracts, options, swaps, collars and similar arrangements.

"Senior indebtedness" in the subordinated indenture means the principal,
premium, if any, and interest on all of our debt, whether created, incurred or
assumed before, on or after the date of the subordinated indenture. However,
senior indebtedness does not include:

. debt that, when incurred and without respect to any election under
Section 1111(b) of Title 11, U.S. Code, was without recourse, and

. other debt which by the terms of the instrument creating or evidencing it
is specifically designated as being subordinated to or pari passu with
the subordinated debt securities, including all other debt securities and
guarantees issued to any trust, partnership or other entity affiliated
with us which is a financing vehicle for us in connection with an
issuance of trust preferred securities.

The subordinated indenture does not limit our ability to incur additional
indebtedness, including indebtedness that ranks senior in priority of payment
to the subordinated debt securities.

Defeasance and Covenant Defeasance

Unless we inform you otherwise in the prospectus supplement, the provisions
of the indenture relating to defeasance and discharge of indebtedness, or
defeasance of restrictive covenants, will apply to the debt securities of any
series. (Section 1401)

Defeasance and Discharge. Section 1402 of the indenture provides that we
will be discharged from all of our obligations with respect to the debt
securities, except for certain obligations to exchange or register the
transfer of debt securities, to replace stolen, lost or mutilated debt
securities, to maintain paying agencies and to hold moneys for payment in
trust, upon the deposit in trust for the benefit of the holders of such debt
securities of money or U.S. government obligations, or both, which, through
the payment of principal and interest in respect thereof in accordance with
their terms, will provide money in an amount sufficient to pay the principal,
premium, if any, and interest on the debt securities on the respective stated
maturities in accordance with the terms of the indenture and the debt
securities. Such defeasance or discharge may occur only if, among other
things, we have delivered to the trustee an opinion of counsel to the effect
that we have received from, or there has been published by, the United States
Internal Revenue Service a ruling, or there has been a change in tax law, in
either case to the effect that holders of the debt securities will not
recognize gain or loss for federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to federal income tax on
the same amount, in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge were not to occur.
(Sections 1402 and 1404)

Defeasance of Certain Covenants. Section 1403 of the indenture provides
that, in certain circumstances, we may omit to comply with specified
restrictive covenants, including any that we may describe in the prospectus
supplement, and that in those circumstances the occurrence of certain events
of default, which are described in the fourth bullet point above, with respect
to such restrictive covenants, under "Events of Default" and any that may be
described in the prospectus supplement, will be deemed not to be or result in
an event of default, in each case with respect to the debt securities. We, in
order to exercise such option, will be required to deposit, in trust for the
benefit of the holders of the debt securities, money or U.S. government
obligations, or both, which, through the payment of principal and interest in
respect thereof in accordance with their terms, will provide money in an
amount sufficient to pay the principal, premium, if any, and interest on the
debt securities on the respective stated maturities in accordance with the
terms of the indenture and the debt securities. We will also be required,
among other things, to deliver to the trustee an opinion of counsel to the
effect that holders of the debt securities will not recognize gain or loss for
federal income tax purposes as a result of such deposit and defeasance of
certain obligations and will be subject to federal income tax on the same
amount, in the same

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manner and at the same times as would have been the case if such deposit and
defeasance were not to occur. In the event we exercise this option with
respect to any debt securities and the debt securities were declared due and
payable because of the occurrence of any event of default, the amount of money
and U.S. government obligations so deposited in trust would be sufficient to
pay amounts due on the debt securities at the time of their respective stated
maturities, but might not be sufficient to pay amounts due on such debt
securities upon any acceleration resulting from the event of default. In such
case, we would remain liable for those payments. (Sections 1403 and 1404)

Notices

Holders will receive notices by mail at their addresses as they appear in
the security register. (Sections 101 and 106)

Title

We may treat the person in whose name a debt security is registered on the
applicable record date as the owner of the debt security for all purposes,
whether or not it is overdue. (Section 309)

Governing Law

New York law will govern the indentures and the debt securities. (Section
112)

Regarding the Trustee

The applicable trustee will be named in the prospectus supplement.

Plan of Distribution

We may sell debt securities:

. through an underwriter or underwriters,

. through dealers,

. through agents,

. directly to purchasers, including our affiliates, or

. through a combination of any of these methods.

We may authorize underwriters, dealers and agents to solicit offers by
institutions to purchase debt securities from us pursuant to delayed delivery
contracts providing for payment and delivery on a specified date. If we elect
to use delayed delivery contracts, we will describe the date of delivery, the
conditions of the sale and the commissions payable for solicitation of such
contracts in the prospectus supplement.

We will describe the terms of any offering of debt securities in the
prospectus supplement, including:

. the method of distribution,

. the name or names of any underwriters, dealers, purchasers or agents, and
any managing underwriter or underwriters,

. the purchase price of the debt securities and the proceeds we receive
from the sale,

. any underwriting discounts, agency fees or other form of underwriters'
compensation,

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. any discounts and concessions allowed, reallowed or paid to dealers or
agents, and

. the expected time of delivery of the offered debt securities.

We may change the initial public offering price and any discount or
concessions allowed or reallowed to dealers from time to time.

If we use underwriters to sell our debt securities, the underwriting
agreement 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 debt securities if any are purchased. In
connection with the sale of debt securities, underwriters may receive
compensation from us or from purchasers of debt securities for whom they may
act as agents in the form of discounts, concessions or commissions.
Underwriters may sell debt securities to or through dealers, and dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act
as agents.

If we use a dealer to sell debt securities, we will sell the debt securities
to the dealer as principal. The dealer may then resell the debt securities to
the public at varying prices to be determined by the dealer at the time of
resale. These dealers may be deemed underwriters, as such term is defined in
the Securities Act of 1933, of the debt securities they offer and sell. If we
elect to use a dealer to sell debt securities, we will provide the name of the
dealer and the terms of the transaction in the prospectus supplement.

Debt securities may also be offered and sold in connection with a
remarketing upon their purchase, in accordance with a redemption or repayment
by their terms or otherwise by one or more remarketing firms acting as
principals for their own accounts or as our agents. We will identify any
remarketing firm, the terms of any remarketing agreement and the compensation
to be paid to a remarketing firm in the prospectus supplement. Remarketing
firms may be deemed underwriters under the Securities Act of 1933.

Underwriters, agents, dealers and some purchasers participating in the
distribution of debt securities may be deemed to be underwriters, and any
discounts and commissions received by them and any profit realized by them on
resale of debt securities may be deemed to be underwriting discounts and
commissions under the Securities Act of 1933.

Unless we inform you otherwise in the prospectus supplement, none of our
directors, officers or employees will solicit or receive a commission in
connection with direct sales of debt securities, although these persons may
respond to inquiries by potential purchasers and perform ministerial and
clerical work in connection with any such direct sales.

We may enter into agreements with the underwriters, agents, purchasers,
dealers or remarketing firms who participate in the distribution of our debt
securities that will require us to indemnify them against specified
liabilities, including liabilities under the Securities Act of 1933, or to
contribute to payments that they or any person controlling them may be
required to make for those liabilities. Underwriters, agents or dealers may be
our customers. They may also engage in transactions with us or perform
services for us or for our affiliates in the ordinary course of business.

Each series of debt securities will be a new issue with no established
trading market. We may elect to list any series of debt securities on an
exchange. However, we are not obligated to do so. It is possible that one or
more underwriters may make a market in a series of debt securities. However,
they will not be obligated to do so and may discontinue market making at any
time without notice. We cannot assure you that a liquid trading market for the
debt securities will develop.

In connection with an offering, the underwriters or agents may purchase and
sell debt securities in the open market. These transactions may include over-
allotment and stabilizing transactions and purchases to cover syndicate short
positions created in connection with the offering. Stabilizing transactions
consist of bids or

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purchases for the purpose of preventing or retarding a decline in the market
price of the debt securities. Syndicate short positions involve the sale by
the underwriters or agents of a greater number of debt securities than they
are required to purchase from us in the offering. The underwriters also may
impose a penalty bid, in which selling concessions allowed to syndicate
members or other broker dealers in respect of the debt securities sold in the
offering for their account may be reclaimed by the syndicate if the debt
securities are repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or otherwise affect the
market price of the debt securities, which may be higher than the price that
might otherwise prevail in the open market, and these activities, if
commenced, may be discontinued at any time. These transactions may be effected
on the NYSE, in the over-the-counter market or otherwise.

Validity of Securities

The validity of the debt securities will be passed upon for us by Baker &
Botts, L.L.P., Houston, Texas. Hugh Rice Kelly, Esq., our Executive Vice
President, General Counsel and Corporate Secretary or Rufus S. Scott, our Vice
President, Deputy General Counsel and Assistant Corporate Secretary may pass
upon other legal matters for us. Any underwriters will be advised about the
validity of the debt securities and other legal matters by their own counsel.
James A. Baker, III, a senior partner in the law firm of Baker & Botts,
L.L.P., is currently one of our directors, and, a beneficial owner of 3,000
shares of our common stock.

Experts

Our consolidated financial statements incorporated in this prospectus by
reference from our Annual Report on Form 10-K for the year ended December 31,
1998 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report which is incorporated herein by reference, and have
been so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.

-21-
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

The Company estimates that expenses in connection with the offering
described in this Registration Statement will be as follows:

<TABLE>
<S> <C>
Securities and Exchange Commission filing fee...................... $278,000
Blue sky expenses.................................................. 5,000
Attorney's fees and expenses....................................... 120,000
Independent Auditor's fees and expenses............................ 15,000
Printing and engraving expenses.................................... 40,000
Rating agency fees................................................. 130,000
Trustee's fees and expenses........................................ 10,000
Miscellaneous expenses............................................. 2,000
--------
Total............................................................ $600,000
========
</TABLE>

Item 15. Indemnification of Directors and Officers.

Article 2.02.A.(16) and Article 2.02-1 of the Texas Business Corporation Act
and Article V of the Company's Amended and Restated Bylaws provide the Company
with broad powers and authority to indemnify its directors and officers and to
purchase and maintain insurance for such purposes. Pursuant to such statutory
and Bylaw provisions, the Company has purchased insurance against certain
costs of indemnification that may be incurred by it and by its officers and
directors.

Additionally, Article IX of the Company's Restated Articles of Incorporation
provides that a director of the Company is not liable to the Company for
monetary damages for any act or omission in the director's capacity as
director, except that Article IX does not eliminate or limit the liability of
a director for (i) breaches of such director's duty of loyalty to the Company
and its shareholders, (ii) acts or omissions not in good faith or which
involve intentional misconduct or knowing violation of law, (iii) transactions
from which a director receives an improper benefit, irrespective of whether
the benefit resulted from an action taken within the scope of the director's
office, (iv) acts or omissions for which liability is specifically provided by
statute and (v) acts relating to unlawful stock repurchases or payments of
dividends.

Article IX also provides that any subsequent amendments to Texas statutes
that further limit the liability of directors will inure to the benefit of the
directors, without any further action by shareholders. Any repeal or
modification of Article IX shall not adversely affect any right of protection
of a director of the Company existing at the time of the repeal or
modification.

If the Company uses underwriters to sell debt securities offered hereby, the
underwriting agreement to be entered into in connection with the offering of
the debt securities, will provide that the Underwriters shall indemnify the
Company, its directors and certain officers of the Company against liabilities
resulting from information furnished by or on behalf of the Underwriters
specifically for use in the Registration Statement.

See "Item 17. Undertakings" for a description of the Commission's position
regarding such indemnification provisions.

Item 16. Exhibits.

See Index to Exhibits at page II-5.

II-1
<PAGE>

Item 17. Undertakings.

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the 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 the 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 a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration statement;

(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;

provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section
do not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
registrant pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement 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.

(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
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 Act
and will be governed by the final adjudication of such issue.

II-2
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, the State of Texas, on September 2, 1999.

RELIANT ENERGY, INCORPORATED
(Registrant)

By: /s/ R. Steve Letbetter
-----------------------------------
R. Steve Letbetter,
President and Chief Executive
Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints R. Steve Letbetter, Don D. Jordan, Lee W.
Hogan, Stephen W. Naeve, Robert Harvey and Hugh Rice Kelly, and each of them
severally, his true and lawful attorney or attorneys-in-fact and agents, with
full power to act with or without the others and with full power of
substitution and resubstitution, to execute in his name, place and stead, in
any and all capacities, any or all amendments (including pre-effective and
post-effective amendments) to this Registration Statement and any registration
statement for the same offering filed pursuant to Rule 462 under the
Securities Act of 1933, as amended, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents and each
of them full power and authority, to do and perform in the name and on behalf
of the undersigned, in any and all capacities, each and every act and thing
necessary or desirable to be done in and about the premises, to all intents
and purposes and as fully as they might or could do in person, hereby
ratifying, approving and confirming all that said attorneys-in-fact and agents
or their substitutes may lawfully do or cause to be done by virtue hereof.

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.

<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----

<S> <C> <C>
/s/ R. Steve Letbetter President, Chief Executive September 2, 1999
____________________________________ Officer and Director
(R. Steve Letbetter) (Principal Executive Officer
and Director)

/s/ Stephen W. Naeve Vice Chairman and Chief September 2, 1999
____________________________________ Financial Officer (Principal
(Stephen W. Naeve) Financial Officer)

/s/ Mary P. Ricciardello Senior Vice President and September 2, 1999
____________________________________ Comptroller (Principal
(Mary P. Ricciardello) Accounting Officer)
</TABLE>

II-3
<PAGE>

<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----

<S> <C> <C>
Director September 2, 1999
____________________________________
(James A. Baker, III)

/s/ Richard A. Balzhiser Director September 2, 1999
____________________________________
(Richard E. Balzhiser)

/s/ Milton Carroll Director September 2, 1999
____________________________________
(Milton Carroll)

/s/ John T. Cater Director September 2, 1999
____________________________________
(John T. Cater)

/s/ O. Holcombe Crosswell Director September 2, 1999
____________________________________
(O. Holcombe Crosswell)

/s/ Robert J. Cruikshank Director September 2, 1999
____________________________________
(Robert J. Cruikshank)

/s/ Linnet F. Deily Director September 2, 1999
____________________________________
(Linnet F. Deily)

/s/ Lee W. Hogan Director September 2, 1999
____________________________________
(Lee W. Hogan)

/s/ T. Milton Honea Director September 2, 1999
____________________________________
(T. Milton Honea)

/s/ Don D. Jordan Chairman of the Board September 2, 1999
____________________________________
(Don D. Jordan)

/s/ Alexander F. Schilt Director September 2, 1999
____________________________________
(Alexander F. Schilt)
</TABLE>

II-4
<PAGE>

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Report or SEC File or
Exhibit Registration Registration Exhibit
Number Document Description Statement Number Reference
------- -------------------- ------------ ------------ ---------
<C> <S> <C> <C> <C>
1* Form of Underwriting
Agreement
4.1* Form of Senior Indenture
4.2* Form of Subordinated
Indenture
4.3* Form of Senior Debt
Security (included in
Exhibit 4.1)
4.4* Form of Subordinated Debt
Security (included in
Exhibit 4.2)
5* Opinion of Baker & Botts,
L.L.P.
12.1** Statement Regarding Form 10-Q for the 1-3187 12
Computation of Ratios for quarterly period
the six month periods ended ended June 30,
June 30, 1998 1998
12.2** Statement Regarding Form 10-Q for the 1-3187 12
Computation of Ratios for quarterly period
the six month period ended ended June 30,
June 30, 1999 1999
12.3** Statement Regarding Form 10-K for the 1-3187 12
Computation of Ratios for year ended
the twelve month periods December 31,
ended December 31, 1998, 1998
1997, 1996, 1995 and 1994
23.1 Consent of Deloitte &
Touche LLP
23.2* Consent of Baker & Botts,
L.L.P. (included in Exhibit
5)
24 Power of Attorney (included
on page II-3 of this
registration statement)
25* Statement of Eligibility of
Trustee on Form T-1
</TABLE>
- --------
* To be filed by amendment or by a report on Form 8-K pursuant to Regulation
S-K, Item 601(b).
** Incorporated herein by reference as indicated.

II-5

<PAGE>

EXHIBIT 23.1

INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference in this Registration Statement
of Reliant Energy, Incorporated ("Reliant Energy") on Form S-3 of our report
dated February 25, 1999 appearing in the Annual Report on Form 10-K of Reliant
Energy for the year ended December 31, 1998 and to the reference to us under the
heading "Experts" in the Prospectus, which is a part of this Registration
Statement.

DELOITTE & TOUCHE LLP
Houston, Texas
September 2, 1999