File No. 70-8487
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
__________________________________
Amendment No. 1
to the
Form U-1/A
__________________________________
APPLICATION-DECLARATION
under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
__________________________________
Louisiana Power & Light Company
639 Loyola Avenue
New Orleans, Louisiana 70113
(Name of company filing this statement and address
of principal executive offices)
__________________________________
Entergy Corporation
(Name of top registered holding company parent of each
applicant or declarant)
__________________________________
John J. Cordaro Gerald D. McInvale
President Senior Vice President and
Louisiana Power & Light Company Chief Financial Officer
639 Loyola Avenue Entergy Services, Inc.
New Orleans, Louisiana 70113 639 Loyola Avenue
New Orleans, Louisiana 70113
(Names and addresses of agents for service)
__________________________________
The Commission is also requested to send copies of any communications
in connection with this matter to:
Laurence M. Hamric, Esq. McChord Carrico, Esq.
Denise C. Redmann, Esq. Monroe & Lemann
Steven McNeal (A Professional Corporation)
Entergy Services, Inc. 201 St. Charles Avenue
639 Loyola Avenue New Orleans, Louisiana 70170-3300
New Orleans, Louisiana 70113
Thomas J. Igoe, Jr., Esq. David P. Falck, Esq.
Reid & Priest LLP Winthrop, Stimson, Putnam & Roberts
40 West 57th Street One Battery Park Plaza
New York, New York 10019 New York, New York 10004
<PAGE>
The Application-Declaration is hereby amended in its entirety and
restated to read as follows:
Item 1. Description of Proposed Transactions
Section A. General
1. Louisiana Power & Light Company ("Company"), a
subsidiary of Entergy Corporation, a registered holding
company under the Public Utility Holding Company Act of
1935, as amended ("Holding Company Act"), proposes from
time to time through December 31, 1997, (1) to issue
and sell one or more new series of the Company's First
Mortgage Bonds ("Bonds"), one or more series of the
Company's Debentures ("Debentures") and, through a
special purpose subsidiary of the Company, one or more
series of preferred securities of such subsidiary with
a $25 per share stated liquidation preference ("Entity
Interests"), in a combined aggregate principal amount
of said Bonds, Debentures and Entity Interests not to
exceed $610 million, and one or more new series of the
Company's Preferred Stock, either $25 par value or $100
par value having an aggregate par value not to exceed
$123.5 million ("Preferred"), (2) to enter into
arrangements to reimburse the Company for the costs of,
or to finance or refinance, certain pollution control,
including solid waste and/or sewage disposal,
facilities through the issuance by the Parish of St.
Charles, Louisiana, the Parish of Ouachita, Louisiana
and/or the Parish of Jefferson, Louisiana of one or
more new series of tax-exempt bonds in an aggregate
principal amount not to exceed $65 million ("Tax-Exempt
Bonds"), including the possible issuance and pledge of
one or more new series of the Company's First Mortgage
Bonds in an aggregate principal amount not to exceed
$75 million ("Collateral Bonds") as security for Tax-
Exempt Bonds, and (3) to acquire ("Acquisition
Program") in whole or in part, one or more series of
the Company's outstanding First Mortgage Bonds and/or
Preferred Stock and/or Pollution Control Revenue Bonds
and Industrial Development Revenue Bonds previously
issued for the benefit of the Company. Each of these
proposed transactions is discussed in greater detail
below.
Section B. Issuance and Sale of the Bonds, Debentures,
Entity Interests and Preferred
1. The Bonds are to be issued under the Company's
Mortgage and Deed of Trust, dated as of April 1, 1944,
to Bank of Montreal Trust Company, successor to The
Chase National Bank of the City of New York, and Mark
McLaughlin, successor to Z. George Klodnicki, successor
to Carl E. Buckley, as Trustees, as heretofore
supplemented ("Mortgage"), and as proposed to be
further supplemented by additional Supplemental
Indenture(s), each relating to one or more series of
Bonds.
2. Each series of Bonds will be sold at such price,
will bear interest at such rate and will mature on such
date as will be determined at the time of sale. No
series of Bonds will be sold if the fixed interest rate
or initial adjustable interest rate thereon would
exceed the lower of 15% or rates generally obtained at
the time of pricing for sales of first mortgage bonds
having the same maturity, issued by companies of
comparable credit quality and having similar terms,
conditions and features. As to series having an
adjustable interest rate, the initial interest rate for
Bonds of such series would be determined in discussions
between the Company and the purchasers of such series
and would be based on the current market rate for
comparable bonds. Thereafter, the interest rate on
such Bonds would be adjusted according to a pre-
established formula or method of determination
("Floating Rate Bonds") or would be that rate which
would, when set, be sufficient to remarket the Bonds of
such series at their principal amount ("Remarketed
Bonds").
3. The interest rate for Floating Rate Bonds after
the initial interest rate period may be set as a
percentage of, or as a specified spread from, a
benchmark rate, such as the London Interbank Offered
Rate or the yield to maturity of specified United
States Treasury securities, or may be established by
reference to orders received in an auction procedure,
and will not exceed a specified maximum rate greater
than 15% per annum. Such interest rate may be adjusted
at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
4. The interest rate for Remarketed Bonds after the
initial interest rate period would not be greater than
rates generally obtained at the time of remarketing of
bonds having the same maturity, issued by specified
companies of comparable credit quality and having
comparable terms and would not exceed a specified
maximum rate greater than 15% per annum. Paragraphs 5
and 6 below relate to Bonds that are Remarketed Bonds.
5. The Supplemental Indenture to the Mortgage for
Bonds would provide that holders of Bonds would have
the right to tender or be required to tender their
Bonds and have them purchased at a price equal to the
principal amount thereof, plus any accrued and unpaid
interest thereon, on dates specified in, or established
in accordance with, the Supplemental Indenture. A
Tender Agent may be appointed to facilitate the tender
of any Bonds by holders. Any holder of Bonds wishing
to have such Bonds purchased may be required to deliver
such Bonds during a specified period of time preceding
such purchase date to the Tender Agent, if one shall be
appointed, or to the Remarketing Agent appointed to
reoffer such tendered Bonds for sale.
6. The Company would be obligated to pay amounts
equal to the amounts to be paid the Remarketing Agent
or the Tender Agent pursuant to the Supplemental
Indenture for the purchase of Bonds so tendered, such
amounts to be paid by the Company on the dates such
payments by the Remarketing Agent or the Tender Agent
are to be made; reduced by the amount of any other
moneys available therefor, including the proceeds of
the sale of such tendered Bonds by the Remarketing
Agent. Upon the delivery of such Bonds by holders to
the Remarketing Agent or the Tender Agent for purchase,
the Remarketing Agent would use its best efforts to
sell such Bonds at a price equal to the principal
amount of such Bonds.
7. The price, exclusive of accrued interest, to be
paid to the Company for each such series of Bonds to be
sold at competitive bidding will be within a range (to
be specified by the Company to prospective purchasers)
of not more than five percentage points, and will not
exceed five percentage points above or below 100% of
the principal amount of such series of Bonds. Each
series of Bonds will mature not later than forty years
from the first day of the month of issuance. The
Company may determine to provide an insurance policy
for the payment of the principal of, and/or interest
and/or premium on, one or more series of Bonds.
8. One or more series of Bonds may include provisions
for redemption prior to maturity at various percentages
of the principal amount thereof and may include
restrictions on optional redemption for a given number
of years. In addition, one or more series of Bonds may
include provisions for the mandatory retirement of some
or all of such series prior to maturity. In each
supplemental indenture relating to a series of Bonds,
the Company may covenant that, so long as any Bonds of
such series remain outstanding, the Company will not
pay any cash dividends on common stock subsequent to
the date of such series of Bonds (other than certain
dividends declared prior to the original issuance of
such series) except from credits to retained earnings
after such date, plus $345 million, plus such
additional amounts as shall be approved by the
Securities and Exchange Commission ("Commission").
However, the Company may determine not to include any
provisions restricting its ability to pay common stock
dividends.
9. Reference is made to Exhibits A-1, A-2, A-4 and B-
1 hereto for further information with respect to the
terms of each series of Bonds.
10. The Debentures will be issued under either the
Company's Debenture Indenture or its Subordinated
Debenture Indenture, to be substantially in the forms
attached as Exhibits A-10 and A-12, respectively (each,
a "Debenture Indenture"), as may be supplemented from
time to time.
11. Each series of Debentures will be sold at such
price, will bear interest at such rate and will mature
on such date as will be determined at the time of sale.
No series of Debentures will be sold if the fixed
interest rate or initial adjustable interest rate
thereon would exceed the lower of 15% or rates
generally obtained at the time of pricing for sales of
debentures having the same maturity, issued by
companies of comparable credit quality and having
similar terms, conditions and features. As to series
having an adjustable interest rate, the initial
interest rate for Debentures of such series would be
determined in discussions between the Company and the
purchasers of such series and would be based on the
current market rate for comparable debentures.
Thereafter, the interest rate on such Debentures would
be adjusted according to a pre-established formula or
method of determination ("Floating Rate Debentures") or
would be that rate which would, when set, be sufficient
to remarket the Debentures of such series at their
principal amount ("Remarketed Debentures").
12. The interest rate for Floating Rate Debentures
after the initial interest rate period may be set as a
percentage of, or as a specified spread from, a
benchmark rate, such as the London Interbank Offered
Rate or the yield to maturity of specified United
States Treasury securities, or may be established by
reference to orders received in an auction procedure,
and will not exceed a specified maximum rate greater
than 15% per annum. Such interest rate may be adjusted
at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
13. The interest rate for Remarketed Debentures after
the initial interest rate period would not be greater
than rates generally obtained at the time of
remarketing of debentures having the same maturity,
issued by specified companies of comparable credit
quality and having comparable terms and would not
exceed a specified maximum rate greater than 15% per
annum. Paragraphs 14 and 15 below relate to Debentures
that are Remarketed Debentures.
14. The Debenture Indenture for Debentures would
provide that holders of Debentures would have the right
to tender or be required to tender their Debentures and
have them purchased at a price equal to the principal
amount thereof, plus any accrued and unpaid interest
thereon, on dates specified in, or established in
accordance with, the Debenture Indenture. A Tender
Agent may be appointed to facilitate the tender of any
Debentures by holders. Any holder of Debentures
wishing to have such Debentures purchased may be
required to deliver such Debentures during a specified
period of time preceding such purchase date to the
Tender Agent, if one shall be appointed, or to the
Remarketing Agent appointed to reoffer such tendered
Debentures for sale.
15. The Company would be obligated to pay amounts
equal to the amounts to be paid the Remarketing Agent
or the Tender Agent pursuant to the Supplemental
Indenture for the purchase of Debentures so tendered,
such amounts to be paid by the Company on the dates
such payments by the Remarketing Agent or the Tender
Agent are to be made; reduced by the amount of any
other moneys available therefor, including the proceeds
of the sale of such tendered Bonds by the Remarketing
Agent. Upon the delivery of such Debentures by holders
to the Remarketing Agent or the Tender Agent for
purchase, the Remarketing Agent would use its best
efforts to sell such Debentures at a price equal to the
principal amount of such Debentures.
16. The price, exclusive of accrued interest, to be
paid to the Company for each such series of Debentures
to be sold at competitive bidding will be within a
range (to be specified by the Company to prospective
purchasers) of not more than five percentage points,
and will not exceed five percentage points above or
below 100% of the principal amount of such series of
Debentures. Each series of Debentures will mature not
later than forty years from the first day of the month
of issuance. The Company may determine to provide an
insurance policy for the payment of the principal of,
and/or interest and/or premium on, one or more series
of Debentures.
17. One or more series of Debentures may include
provisions for redemption prior to maturity at various
percentages of the principal amount thereof and may
include restrictions on optional redemption for a given
number of years. In addition, one or more series of
Debentures may include provisions for the mandatory
retirement of some or all of such series prior to
maturity.
18. Debentures issued under the Subordinated Debenture
Indenture would be expressly subordinated to Senior
Indebtedness, as defined therein or pursuant thereto,
and may also provide that payment of interest on such
Debentures may be deferred, without creating a default
with respect thereto, for specified periods, so long as
no dividends are being paid, or certain actions are
taken related to the retirement of, the common or
preferred stock of the Company during such period of
deferral. In addition, in each Subordinated Debenture
Indenture relating to a series of Debentures, the
Company may covenant that, so long as any Debentures of
such series remain outstanding, the Company will not
pay cash dividends on common stock subsequent to the
date of such series of Debentures (other than certain
dividends declared prior to the original issuance of
such series) except from credits to retained earnings
after such date, plus $345 million, plus such
additional amounts as shall be approved by the
Commission. However, the Company may determine not to
include any provisions restricting its ability to pay
common stock dividends.
19. Reference is made to Exhibits A-10, A-11, A-12, A-
13 and B-8 hereto for further information with respect
to the terms of each series of Debentures.
20. The Company proposes to organize either a special
purpose limited partnership under the Delaware Revised
Uniform Limited Partnership Act or a statutory business
trust under the laws of the State of Delaware for the
sole purpose of issuing the Entity Interests (the
"Issuing Entity"). In the case of a limited
partnership, the Company will either (a) act as the
general partner of the Issuing Entity or (b) organize a
special purpose, wholly-owned corporation under the
Delaware General Corporation Law for the sole purpose
of acting as the general partner of the Issuing Entity
(the "Participating Subsidiary"). In the case of a
business trust, the business and affairs of the trust
will be conducted by one or more trustees (the
"Trustee(s)"). The Company will, as a result of its
ownership of all common securities in the Issuing
Entity (see paragraph 21 below), be entitled to
appoint, remove or replace any of, or increase or
reduce the number of, such Trustee(s).
21. The Company will directly or indirectly make an
equity contribution to the Issuing Entity at the time
the Entity Interests are issued and thereby directly or
indirectly acquire all of the general partnership
interest (in the case of a limited partnership) or all
of the common securities (in the case of a business
trust) in such Issuing Entity. The Company's equity
contribution to the Issuing Entity will at all times
constitute at least 3% of the aggregate equity
contributions by all securityholders to such Issuing
Entity.
22. The Entity Interests, with $25 per share stated
liquidation preference, will be registered under the
Securities Act of 1933, as amended, under a
registration statement filed under the Securities Act
of 1933, as amended (the "Entity Registration
Statement"). The form of the Entity Registration
Statement will be filed through incorporation by
reference as Exhibit C-7. The holders of the Entity
Interests will be either (a) the limited partners (in
the case of a limited partnership) or (b) the preferred
securityholders (in the case of a business trust) of
the Issuing Entity, and the amounts paid by such
holders for the Entity Interests will be treated as
capital contributions to the Issuing Entity.
23. The Company will issue, from time to time in one
or more series, subordinated debentures (the "Entity
Subordinated Debentures") to the Issuing Entity. The
Issuing Entity will use the proceeds from the sale of
its Entity Interests, plus the equity contributions
made to it by either (a) its general partner (in the
case of a limited partnership) or (b) the Company (in
the case of a business trust), to purchase the Entity
Subordinated Debentures. The Entity Subordinated
Debentures will be registered pursuant to the Entity
Registration Statement. The Entity Subordinated
Debentures will be issued pursuant to, and governed by,
an indenture that will be qualified under the Trust
Indenture Act of 1939, as amended (the "Entity
Subordinated Debenture Indenture"). Drafts of the
Entity Subordinated Debenture Indenture and the Entity
Subordinated Debenture will be filed by amendment as
Exhibits A-14 and A-15, respectively.
24. Each series of the Entity Subordinated Debentures
will mature at such time, not more than 50 years from
their date of issuance, as the Company may determine at
the time of issuance. The Entity Subordinated
Debenture Indenture may permit the Entity Subordinated
Debentures to be issued with an initial term of less
than 50 years that may be extended at the Company's
option to up to 50 years from the date of issuance.
For example, the Entity Subordinated Debentures may
have an initial term of 30 years with the Company
having the right to extend the maturity for up to an
additional 19 years. Prior to maturity, the Company
will pay interest only, at either a fixed or adjustable
rate as set forth in the Entity Subordinated Debenture
Indenture, on the Entity Subordinated Debentures. The
distribution rates, payment dates, redemption,
maturity, and other similar provisions of each series
of Entity Interests will be substantially identical to
the interest rates, payment dates, redemption,
maturity, and other provisions of the Entity
Subordinated Debentures relating thereto, and will be
determined by the Issuing Entity at the time of
issuance. The interest paid by the Company on its
Entity Subordinated Debentures will constitute the only
income of the Issuing Entity and will be used by the
Issuing Entity to pay monthly or quarterly (as
determined at the time of the sale of each series)
distributions on the Entity Interests.
25. The Company may also enter into a guaranty (the
"Guaranty") pursuant to which it will unconditionally
guarantee (i) payment of distributions on the Entity
Interests, if and to the extent the Issuing Entity has
funds legally available therefor, (ii) payments to the
holders of Entity Interests of amounts due upon
liquidation of the Issuing Entity or redemption of the
Entity Interests, and (iii) certain additional "gross
up" amounts that may be payable in respect of the
Entity Interests, as described in paragraph 31 below.
Such Guaranty (if issued) will be registered pursuant
to the Entity Registration Statement. A draft of the
Guaranty will be filed by amendment as Exhibit A-19,
unless the Company has decided not to provide the
guaranties described in this paragraph 25.
26. The Company's Entity Subordinated Debentures
issued under the Subordinated Debenture Indenture and
the Guaranty (if issued) would be expressly
subordinated to Senior Indebtedness, as defined therein
or pursuant thereto, and may also provide that payment
of interest on such Entity Subordinated Debentures may
be deferred, without creating a default with respect
thereto, for specified periods, so long as no dividends
are being paid, or certain actions are taken related to
the retirement of, the common or preferred stock of the
Company during such period of deferral. In addition,
in each Entity Subordinated Debenture Indenture
relating to a series of Entity Subordinated Debentures,
the Company may covenant that, so long as any Entity
Subordinated Debentures of such series remain
outstanding, the Company will not pay cash dividends on
common stock subsequent to the date of such series of
Entity Subordinated Debentures (other than certain
dividends declared prior to the original issuance of
such series) except from credits to retained earnings
after such date, plus $345 million, plus such
additional amounts as shall be approved by the
Commission. However, the Company may determine not to
include any provisions restricting its ability to pay
common stock dividends.
27. Distributions on the Entity Interests will be made
either monthly or quarterly (as determined at the time
of sale of each series), will be cumulative, and will
be mandatory to the extent that the Issuing Entity has
legally available funds and sufficient cash for such
purposes. The availability of such funds will depend on
the Issuing Entity's receipt of the amounts due under
the Entity Subordinated Debentures. The Issuing Entity
will have the right to defer distributions on the
Entity Interests for a specified period, but only if
and to the extent that the Company defers the interest
payments on the Entity Subordinated Debentures as
described in paragraph 26 above. If distributions on
the Entity Interests (including all previously deferred
distributions, if any) are so deferred for 18
consecutive months, then the holders of Entity
Interests will have the right to appoint a special
representative to enforce the Issuing Entity's rights
under the Entity Subordinated Debentures and Guaranty
(if issued), including, after failure to pay
distributions for such specified period, to accelerate
the maturity of the Entity Subordinated Debentures.
28. It is expected that the interest payments by the
Company on the Entity Subordinated Debentures will be
deductible for federal income tax purposes and that the
Issuing Entity will be treated as either a partnership
or a trust, as the case may warrant, for federal income
tax purposes. Consequently, the holders of Entity
Interests and either (a) the general partner (in the
case of the limited partnership) or (b) the Company (in
the case of the business trust) will be deemed to have
received partnership distributions (in the case of a
limited partnership) or original issue discount (in the
case of a business trust), not dividends, from the
Issuing Entity and will not be entitled to any
"dividends received deduction" under the Internal
Revenue Code.
29. One or more series of each of the Entity Interests
and the Entity Subordinated Debentures may include
provisions for the mandatory retirement of some or all
of such series prior to maturity. The Entity Interests
will be subject to redemption in whole or part on and
after a specified date (the "Earliest Redemption Date")
at the option of the Issuing Entity, with the consent
of the Company, at a price equal to their stated
liquidation preference plus any accrued and unpaid
distributions (the "Redemption Price"). The Earliest
Redemption Date will be determined based on, among
other factors, market conditions at the time of
issuance, but will be not later than 10 years after the
date of issuance. The Entity Subordinated Debenture
Indenture and the Entity Agreement (as defined in
paragraph 33 below) may set forth additional provisions
governing the optional redemption of the Entity
Interests. In particular, it is expected that the
Issuing Entity will have the option, with the consent
of the Company, to redeem the Entity Interests at the
Redemption Price upon the occurrence of specified
adverse tax events (each, a "Tax Event"). Examples of
possible Tax Events include (a) the Issuing Entity is
subject to federal income tax with respect to interest
received on the Entity Subordinated Debentures or is
otherwise not treated as either a partnership or a
trust, as the case may warrant, for federal income tax
purposes, (b) it is determined that the interest
payments by the Company on the Entity Subordinated
Debentures are not deductible for federal income tax
purposes, or (c) the Issuing Entity is subject to more
than a minimal amount of other taxes, duties, or other
governmental charges. The Entity Subordinated
Debenture Indenture and the Entity Agreement may also
provide that the Entity Interests are subject to
optional or mandatory redemption upon the occurrence of
specified adverse regulatory events (each, a
"Regulatory Event"). An example of a possible
Regulatory Event is that the Issuing Entity becomes
subject to regulation as an "investment company" under
the Investment Company Act of 1940, as amended.
30. It is expected that, upon the occurrence of a Tax
Event or a Regulatory Event, the Company may also have
the right to exchange the Entity Subordinated
Debentures for the Entity Interests or to otherwise
distribute the Entity Subordinated Debentures to the
holders of Entity Interests, whereupon the Entity
Interests would be canceled and nullified.
31. If, as a result of (a) the Entity Subordinated
Debentures not being treated as indebtedness for
federal income tax purposes, or (b) the Issuing Entity
not being treated as either a partnership or a trust,
as the case may warrant, for federal income tax
purposes, the Issuing Entity is required by applicable
tax laws to withhold or deduct from payments on the
Entity Interests amounts which would not otherwise be
required to be withheld or deducted, the Issuing Entity
may also have the obligation, if the Entity Interests
are not redeemed (as discussed in paragraph 29 above)
or exchanged (as discussed in paragraph 30 above), to
"gross up" such payments so that the holders of Entity
Interests will receive the same payment after such
withholding or deduction as they would have received if
no such withholding or deduction were required.
32. In the event of any voluntary or involuntary
liquidation, dissolution, or winding up the Issuing
Entity, holders of Entity Interests will be entitled to
receive, out of the assets of the Issuing Entity
available for distribution to the limited partners (in
the case of a limited partnership) or the preferred
securityholders (in the case of a business trust),
before any distribution of assets to the general
partner (in the case of a limited partnership) or the
Company (in the case of a business trust), an amount
equal to the stated liquidation preference of the
Entity Interests plus any accrued and unpaid
distributions.
33. Under either the Amended and Restated Agreement of
Limited Partnership or the Declaration of Trust, as
such document will govern the activities of the Issuing
Entity upon the issuance of the Entity Interests (the
"Entity Agreement"), the activities of the Issuing
Entity will be limited to the issuance and sale of
Entity Interests, the use of the proceeds thereof and
the equity contributions by either the general partner
(in the case of a limited partnership) or the Company
(in the case of a business trust) to purchase the
Entity Subordinated Debentures, the receipt of interest
on the Entity Subordinated Debentures, and the payment
of distributions on the Entity Interests. A draft of
the Entity Agreement will be filed by amendment as
Exhibit A-16.
34. The Entity Agreement will further state that the
Issuing Entity's business and affairs will be managed
and controlled directly by either the general partner
(in the case of a limited partnership) or the
Trustee(s) (in the case of a business trust), that
either the general partner (in the case of limited
partnership) or the Company (in the case of a business
trust) will be responsible for all liabilities and
obligations of the Issuing Entity, and that the general
partnership interest (in the case of a limited
partnership) or the common securities (in the case of a
business trust) are not transferrable except for a
transfer made (a) with the consent of all other
partners (in the case of a limited partnership) or
securityholders (in the case of a business trust), (b)
to a direct or indirect wholly-owned subsidiary, or (c)
in the event of merger, subject to certain conditions.
35. Because the Entity Interests will be supported by
the Company's Entity Subordinated Debentures and
Guaranty (if issued), and the distributions to holders
of Entity Interests will be paid out of the interest
payments on such Entity Subordinated Debentures or
pursuant to such Guaranty (if issued), it is proposed
that the Entity Agreement will not include any interest
or distribution coverage or capitalization ratio
restrictions on the ability to issue and sell
additional issues of Entity Interests. Such
restrictions would not be relevant or necessary, nor
are the capital structures of the Issuing Entity
relevant, because the interest payments of the Company
on the Entity Subordinated Debentures are expected to
fully service the distributions on Entity Interests.
For this reason, financial statements for the Issuing
Entity are not included with this Application-
Declaration.
36. Each series of Entity Interests (and any
corresponding series of Entity Subordinated Debentures)
will be sold at such price and will be entitled to
receive such distributions (or interest payments) on
such periodic basis as will be determined at the time
of sale. No series of Entity Interests (or any
corresponding series of Entity Subordinated Debentures)
will be sold if the fixed distribution (or interest)
rate or initial adjustable distribution (or interest)
rate thereon would exceed the lower of 15% or rates
generally obtained at the time of pricing for sales of
limited partnership or business trust interests having
the same maturity, issued by subsidiaries of companies
of comparable credit quality and having similar terms,
conditions and features. As to series having an
adjustable distribution (or interest) rate, the initial
dividend (or interest) rate for Entity Interests of
such series would be determined in discussions between
the Company and the purchasers of such series and would
be based on the current market rate for comparable
subsidiary interests. Thereafter, the dividend (or
interest) rate on such Entity Interests would be
adjusted according to a pre-established formula or
method of determination ("Floating Rate Entity
Interests") or would be that rate which would, when
set, be sufficient to remarket the Entity Interests of
such series at their principal amount ("Remarketed
Entity Interests").
37. The dividend (or interest) rate for Floating Rate
Entity Interests after the initial dividend (or
interest) rate period may be set as a percentage of, or
as a specified spread from, a benchmark rate, such as
the London Interbank Offered Rate or the yield to
maturity of specified United States Treasury
securities, or may be established by reference to
orders received in an auction procedure, and will not
exceed a specified maximum rate greater than 15% per
annum. Such dividend (or interest) rate may be
adjusted at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
38. The dividend (or interest) rate for Remarketed
Entity Interests after the initial dividend (or
interest) rate period would not be greater than rates
generally obtained at the time of remarketing of
limited partnership or business trust interests having
the same maturity, issued by subsidiaries of specified
companies of comparable credit quality and having
comparable terms and would not exceed a specified
maximum rate greater than 15% per annum. Paragraphs 39
and 40 below relate to Entity Interests that are
Remarketed Entity Interests.
39. The Entity Agreement would provide that holders of
Equity Interests would have the right to tender or be
required to tender their Equity Interests and have them
purchased at a price equal to the principal amount
thereof, plus any accrued and unpaid distributions
thereon, on dates specified in, or established in
accordance with, the Entity Agreement. A Tender Agent
may be appointed to facilitate the tender of any Equity
Interests by holders. Any holder of Entity Interests
wishing to have such Entity Interests purchased may be
required to deliver such Entity Interests during a
specified period of time preceding such purchase date
to the Tender Agent, if one shall be appointed, or to
the Remarketing Agent appointed to reoffer such
tendered Entity Interests for sale.
40. The Company would be obligated to pay amounts
equal to the amounts to be paid the Remarketing Agent
or the Tender Agent pursuant to the Entity Agreement
for the purchase of Entity Interests so tendered, such
amounts to be paid by the Company on the dates such
payments by the Remarketing Agent or the Tender Agent
are to be made; reduced by the amount of any other
moneys available therefor, including the proceeds of
the sale of such tendered Entity Interests by the
Remarketing Agent. Upon the delivery of such Entity
Interests by holders to the Remarketing Agent or the
Tender Agent for purchase, the Remarketing Agent would
use its best efforts to sell such Entity Interests at a
price equal to the principal amount of such Entity
Interests.
41. The price, exclusive of accrued distributions, to
be paid to the Issuing Entity for each such series of
Entity Interests to be sold at competitive bidding will
be within a range (to be specified by the Company to
prospective purchasers) of not more than five
percentage points, and will not exceed five percentage
points above or below 100% of the principal amount of
such series of Entity Interests.
42. The Preferred will have par values of either $25
("$25 Preferred Stock") or $100 ("$100 Preferred
Stock"). Each series of Preferred shall consist of
such number of shares of the $25 Preferred Stock or the
$100 Preferred Stock as the Company may determine, but
the total number of such shares of Preferred may not
have an aggregate par value in excess of $123.5
million. In accordance with the Company's Restated
Articles of Incorporation, as amended, the Company has
authorized and unissued as of the date hereof,
1,585,000 shares of its $100 Preferred Stock and
4,230,581 shares of its $25 Preferred Stock.
43. The price, exclusive of accumulated dividends, to
be paid to the Company for each series of Preferred to
be issued and sold will be determined at the time of
sale and will not be less than par value on a per share
basis. With respect to any series of Preferred to be
sold at competitive bidding, the price to be paid to
the Company will not be less than $25 nor more than
$25.70 per share in the case of $25 Preferred Stock,
and not less than $100 nor more than $102.75 per share
in the case of $100 Preferred Stock, in each case plus
accumulated dividends, if any. The dividend rate of
each such series of the Preferred will be a multiple of
4/25ths of 1% for any series of $25 Preferred Stock and
0.01 of 1% for any series of $100 Preferred Stock.
44. No series of Preferred will be sold if the fixed
dividend rate or initial adjustable dividend rate
thereon would exceed the lower of 15% or rates
generally obtained at the time of pricing for sales of
preferred stock having the same maturity, issued by
companies of comparable credit quality and having
similar terms, conditions and features. As to series
having an adjustable dividend rate, the initial
dividend rate for Preferred of such series would be
determined in discussions between the Company and the
purchasers of such series and would be based on the
current market rate for comparable preferred stock.
Thereafter, the dividend rate on such Preferred would
be adjusted according to a pre-established formula or
method of determination ("Floating Rate Preferred") or
would be that rate which would, when set, be sufficient
to remarket the Preferred of such series at their
principal amount ("Remarketed Preferred").
45. The dividend rate for Floating Rate Preferred
after the initial dividend rate period may be set as a
percentage of, or as a specified spread from, a
benchmark rate, such as the London Interbank Offered
Rate or the yield to maturity of specified United
States Treasury securities, or may be established by
reference to orders received in an auction procedure,
and will not exceed a specified maximum rate greater
than 15% per annum. Such dividend rate may be adjusted
at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
46. The dividend rate for Remarketed Preferred after
the initial dividend rate period would not be greater
than rates generally obtained at the time of
remarketing of preferred stock having the same
maturity, issued by specified companies of comparable
credit quality and having comparable terms and would
not exceed a specified maximum rate greater than 15%
per annum. Paragraphs 47 and 48 below relate to
Preferred that are Remarketed Preferred.
47. The Restated Articles of Incorporation, as
amended, of the Company (the "Articles") would provide
that holders of Preferred would have the right to
tender or be required to tender their Preferred and
have them purchased at a price equal to the principal
amount thereof, plus any accrued and unpaid dividends
thereon, on dates specified in, or established in
accordance with, the Articles. A Tender Agent may be
appointed to facilitate the tender of any Preferred by
holders. Any holder of Preferred wishing to have such
Preferred purchased may be required to deliver such
Preferred during a specified period of time preceding
such purchase date to the Tender Agent, if one shall be
appointed, or to the Remarketing Agent appointed to
reoffer such tendered Preferred for sale.
48. The Company would be obligated to pay amounts
equal to the amounts to be paid the Remarketing Agent
or the Tender Agent pursuant to the Articles for the
purchase of Preferred so tendered, such amounts to be
paid by the Company on the dates such payments by the
Remarketing Agent or the Tender Agent are to be made;
reduced by the amount of any other moneys available
therefor, including the proceeds of the sale of such
tendered Preferred by the Remarketing Agent. Upon the
delivery of such Preferred by holders to the
Remarketing Agent or the Tender Agent for purchase, the
Remarketing Agent would use its best efforts to sell
such Preferred at a price equal to the principal amount
of such Preferred.
49. The terms of one or more series of Preferred may
include provisions for redemption at various redemption
prices, may include restrictions on optional redemption
for a given number of years and may include provisions
for purchases in lieu of redemption. The Company may
include for any series of Preferred provisions for a
sinking fund designed to redeem annually, commencing a
specified number of years after the first day of the
calendar month in which such series is issued, at the
par value per share of such series plus accumulated
dividends, a number of shares equal to a given
percentage of the total number of shares of such
series, with the Company possibly having a non-
cumulative option to redeem annually an additional
number of shares up to a given percentage of the total
number of shares of such series. Any such sinking fund
provisions would be designed to redeem all outstanding
shares of such series not later than 40 years after the
date of original issuance thereof.
50. The Company anticipates that the issuance and sale
of each series of Bonds, Debentures, Entity Interests
and/or Preferred will be by means of competitive
bidding, or negotiated public offering or private
placement with institutional investors in order to
secure the advantages of an advance marketing effort
and/or the best available terms.
51. Reference is made to Exhibits B-1, B-2, B-3, B-4,
B-8, B-9, B-10 and B-11 for information with respect
to, among other things, the procedures to be followed
in connection with the issuance and sale of Bonds,
Debentures, Entity Interests and/or Preferred. The
sale(s) of Bonds, the sale(s) of Debentures, the
sale(s) of Entity Interests, and the sale(s) of
Preferred are separate transactions not contingent upon
one another.
52. The Company proposes to use the net proceeds
derived from the issuance and sale of Bonds,
Debentures, Entity Interests and/or Preferred for
general corporate purposes, including, but not limited
to, the possible acquisition, redemption and/or
refunding of certain outstanding securities. The
Company is requesting authorization for such sales
primarily to provide the flexibility to permit a quick
response to changing market conditions when it becomes
beneficial for the Company to refinance, refund or
otherwise acquire outstanding high cost securities.
(See "Acquisition Program" below.)
Section C. Issuance and Sale of Tax-Exempt Bonds and
Related Transactions
1. The Company also may seek to enter into
arrangements to reimburse the Company for the costs of,
or to finance or refinance, on a tax-exempt basis, the
acquisition, construction, installation and equipping
of certain pollution control facilities including solid
waste and/or sewage disposal and/or pollution control
facilities ("Facilities") at (a) Unit 3 (nuclear) of
the Company's Waterford Steam Electric Generating
Station ("Waterford 3") in the Parish of St. Charles,
Louisiana, (b) Units 6 and 7 of the Company's
Sterlington Plant ("Sterlington") in the Parish of
Ouachita, Louisiana, or (c) Units 1-5 (gas) of the
Company's Ninemile Point Plant ("Ninemile Point") in
the Parish of Jefferson, Louisiana (collectively, St.
Charles Parish, Ouachita Parish and Jefferson Parish
all referred to as the "Parish"). The Company proposes
to enter into one or more installment sale, lease,
refunding or other facilities agreements and possibly
one or more supplements and/or amendments thereto
(collectively, the "Facilities Agreement") with the
Parish for the issuance and sale by the Parish of one
or more series of Tax-Exempt Bonds in an aggregate
principal amount not to exceed $65 million pursuant to
one or more trust indentures and possibly one or more
supplements thereto (collectively, the "Indenture")
between the Parish and one or more trustees
(collectively, the "Trustee").
2. The proceeds of the sale of Tax-Exempt Bonds, net
of any underwriters' discounts or other expenses
payable from proceeds, will be deposited by the Parish
with the Trustee under the Indenture. Such net
proceeds will be applied to reimburse the Company for,
or to permanently finance on a tax-exempt basis, the
costs of the acquisition, construction, installation or
equipping of, that portion of the Facilities not
previously financed by revenue bonds of the Parish, and
additional costs of construction of the Facilities.
Further, under the Facilities Agreement the Company
would transfer the Facilities to the Parish, and will
reacquire the Facilities from the Parish for a price
sufficient (together with any other moneys held by the
Trustee under the Indenture and available for the
purpose for the particular series of Tax-Exempt Bonds
involved) to pay the principal or purchase price of,
the premium, if any, and the interest on such series of
Tax-Exempt Bonds as the same become due and payable.
Such payments will be made directly to the Trustee
pursuant to an agreement therefor by the Parish to the
Trustee as set forth in the Indenture. The Company
will also be obligated to pay (i) the fees and charges
of the Trustee and any registrar or paying agent under
the Indenture, and, if any, the Remarketing Agent and
the Tender Agent hereinafter referred to, (ii) all
expenses incurred by the Parish in connection with its
rights and obligations under the Agreement, (iii) all
expenses necessarily incurred by the Parish or the
Trustee under the Indenture in connection with the
transfer or exchange of Tax-Exempt Bonds, and (iv)
certain other fees and expenses.
3. The Indenture may provide that, upon the
occurrence of certain events relating to the operation
of Waterford 3, Sterlington, Ninemile Point or
construction or operation of the Facilities, Tax-Exempt
Bonds will be redeemable by the Parish at the direction
of the Company. Any series of Tax-Exempt Bonds may be
made subject to a mandatory cash sinking fund under
which stated portions of Tax-Exempt Bonds of such
series are to be retired at stated times. Tax-Exempt
Bonds may be subject to mandatory redemption in certain
other cases. The payments by the Company in such
circumstances will be sufficient (together with any
other moneys held by the Trustee under the Indenture
and available therefor) to pay the principal or
purchase price of all Tax-Exempt Bonds to be redeemed
or retired and, the premium, if any, thereon, together
with interest accrued or to accrue to the redemption
date on such Tax-Exempt Bonds.
4. The Indenture may provide that after completion of
the Facilities, certain of the proceeds of Tax-Exempt
Bonds that remain unused may be applied to the
redemption or purchase of Tax-Exempt Bonds at the
direction of the Company.
5. It is proposed that the Tax-Exempt Bonds or the
several series thereof mature not later than forty
years from the date of issuance. Tax-Exempt Bonds will
be subject to optional redemption, at the direction of
the Company, in whole or in part at the redemption
prices (expressed as percentages of principal amount)
and at the times, set forth in the Indenture, plus
accrued interest to the redemption date.
6. The Agreement and the Indenture may provide for a
fixed interest rate for one or more series of
Tax-Exempt Bonds and/or for an adjustable interest rate
for one or more series of Tax-Exempt Bonds as
hereinafter described. No series of Tax-Exempt Bonds
will be sold if the fixed interest rate or initial
adjustable interest rate thereon would exceed 15%. As
to series having an adjustable interest rate, the
interest rate for Tax-Exempt Bonds of such series
during the first Rate Period (hereinafter referred to)
would be determined in discussions between the Company
and the purchasers of such series from the Parish and
be based on the current tax-exempt market rate for
comparable bonds having a maturity comparable to the
length of the initial Rate Period. Thereafter, for
each Rate Period, the interest rate on such Tax-Exempt
Bonds would be that rate which would be sufficient to
remarket all tendered Tax-Exempt Bonds of such series
at their principal amount. Such subsequent interest
rates would not be greater than rates generally
obtained at the time of remarketing of tax-exempt bonds
having the same maturity, issued for the benefit of
companies of comparable credit quality and having
comparable credit terms and would not exceed a
specified maximum rate that will not be greater than
15%. Paragraphs 7 through 10 below relate to Tax-
Exempt Bonds having an adjustable interest rate.
7. The term "Rate Period," as used herein, means a
period during which the interest rate on such
Tax-Exempt Bonds of a particular series bearing an
adjustable rate (or method of determination of such
interest rate) is fixed. The initial Rate Period would
commence on the date as of which interest begins to
accrue on such Tax-Exempt Bonds of such series.
8. The Facilities Agreement and the Indenture may
provide that holders of Tax-Exempt Bonds would have the
right to tender or be required to tender their
Tax-Exempt Bonds and have them purchased at a price
equal to the principal amount thereof, plus any accrued
and unpaid interest thereon, on dates specified in, or
established in accordance with, the Indenture. A
Tender Agent may be appointed to facilitate the tender
of any Tax-Exempt Bonds by holders. Any holders of
Tax-Exempt Bonds wishing to have such Tax-Exempt Bonds
purchased may be required to deliver such Tax-Exempt
Bonds during a specified period of time preceding such
purchase date to the Tender Agent, if one shall be
appointed, or to the Remarketing Agent appointed to
offer such tendered Tax-Exempt Bonds for sale.
9. Under the Agreement, the Company would be
obligated to pay amounts equal to the amounts to be
paid by the Remarketing Agent or the Tender Agent
pursuant to the Indenture for the purchase of
Tax-Exempt Bonds so tendered, such amounts to be paid
by the Company on the dates such payments by the
Remarketing Agent or the Tender Agent are to be made;
provided, however, that the obligation of the Company
to make any such payment under the Agreement would be
reduced by the amount of any other moneys available
therefor, including the proceeds of the sale of such
tendered Tax-Exempt Bonds by the Remarketing Agent.
10. Upon the delivery of such Tax-Exempt Bonds by
holders to the Remarketing Agent or the Tender Agent
for purchase, the Remarketing Agent would use its
reasonable efforts to sell such Tax-Exempt Bonds at a
price equal to the stated principal amount of such
Tax-Exempt Bonds.
11. The Facilities Agreement will provide that prior
to the transfer of the Facilities by the Parish to the
Company, such portions of the Facilities as have
already been constructed or acquired by the Company
will be transferred to the Parish by the Company,
subject to the lien of the Company's Mortgage as it may
be further supplemented by additional Supplemental
Indentures. In order to secure the Company's
obligations under the Facilities Agreement and, in the
event the Company enters into a Reimbursement Agreement
(hereinafter referred to and defined in Section 12
below), under the Reimbursement Agreement, the Company
may grant to the Parish, the Trustee and/or the Bank
(hereinafter defined) a lien, subordinate to the lien
of the Company's Mortgage, on the Facilities (the
"Second Mortgage").
12. In order to obtain a more favorable rating on any
series of Tax-Exempt Bonds and thereby improve the
marketability thereof, the Company may arrange for an
irrevocable letter of credit for an amount up to $75
million from a bank (the "Bank") in favor of the
Trustee. In such event, payments with respect to
principal, premium, if any, interest and purchase
obligations in connection with such series of
Tax-Exempt Bonds, coming due during the term of such
letter of credit, which term would not exceed 10 years,
would be secured by, and payable from funds drawn
under, the letter of credit. In order to induce the
Bank to issue such letter of credit, the Company would
enter into a Letter of Credit and Reimbursement
Agreement ("Reimbursement Agreement") with the Bank
pursuant to which the Company would agree to reimburse
the Bank for all amounts drawn under such letter of
credit within a specified period after the date of the
draw and with interest thereon. The terms of the
Reimbursement Agreement would correspond to the terms
in the letter of credit.
13. It is anticipated that the Reimbursement Agreement
would require the payment by the Company to the Bank of
up-front letter of credit fees not to exceed 1/4 of 1%
of the face amount of the letter of credit and annual
letter of credit fees not to exceed 1-3/8% of the face
amount of the letter of credit per annum. Any such
letter of credit may expire or be terminated prior to
the maturity date of the series of Tax-Exempt Bonds
that such letter of credit supports and, in connection
with such expiration or termination, such series of Tax-
Exempt Bonds may be made subject to mandatory
redemption or purchase on or prior to the date of
expiration or termination of such letter of credit,
subject to the right of owners of Tax-Exempt Bonds of
such series not to have their Tax-Exempt Bonds redeemed
or purchased. Provision may be made, as to any such
series of Tax-Exempt Bonds, for extension of the term
of such letter of credit or for the replacement
thereof, upon its expiration or termination, by another
letter of credit from the Bank or a different bank.
14. In addition or as an alternative to the security
provided by a letter of credit, in order to obtain a
more favorable rating on Tax-Exempt Bonds and
consequently improve the marketability thereof, the
Company may (a) determine to provide an insurance
policy for the payment of the principal of and/or
interest and/or premium on one or more series of
Tax-Exempt Bonds, and/or (b) provide security for
holders of Tax-Exempt Bonds and/or the Bank equivalent
to the security accorded to holders of First Mortgage
Bonds outstanding under the Company's Mortgage by
obtaining the authentication of and pledging one or
more new series of First Mortgage Bonds ("Collateral
Bonds") under the Mortgage as it may be supplemented.
Collateral Bonds would be issued on the basis of
unfunded net property additions and/or previously-
retired First Mortgage Bonds and delivered to the
Trustee under the Indenture and/or to the Bank to
evidence and secure the Company's obligation to pay the
purchase price of the Facilities and the Company's
obligation to reimburse the Bank under the
Reimbursement Agreement. These Collateral Bonds could
be issued in several ways. First, if Tax-Exempt Bonds
bear a fixed interest rate, Collateral Bonds could be
issued in a principal amount equal to the principal
amount of such Tax-Exempt Bonds and bear interest at a
rate equal to the rate of interest on such Tax-Exempt
Bonds. Secondly, they could be issued in a principal
amount equivalent to the principal amount of such
Tax-Exempt Bonds plus an amount equal to interest on
those Bonds for a specified period. In such a case,
Collateral Bonds would bear no interest. Thirdly,
Collateral Bonds could be issued in a principal amount
equivalent to the principal amount of such Tax-Exempt
Bonds or in such amount plus an amount equal to
interest on those Bonds for a specified period, but
carry a fixed interest rate that would be lower than
the fixed interest rate of the Tax-Exempt Bonds.
Fourthly, they could be issued in a principal amount
equivalent to the principal amount of Tax-Exempt Bonds
at an adjustable rate of interest, varying with such
Tax-Exempt Bonds but having a "cap" (not greater than
15%) above which the interest on Collateral Bonds could
not rise. For further information with respect to the
Facilities Agreement and the Collateral Bonds,
reference is made to Exhibits A-3, A-5 and B-6.
15. Each series of the Collateral Bonds that bear
interest would bear interest at a fixed interest rate
or initial adjustable interest rate not to exceed 15%.
The maximum aggregate principal amount of Collateral
Bonds that would be issued is $75 million. The
Collateral Bonds would be separate and apart from the
Bonds (proposed to be issued and sold in an aggregate
principal amount of not more than $610 million), and
would be in addition to the Bonds. The terms of the
Collateral Bonds relating to maturity, interest payment
dates, if any, redemption provisions and acceleration
will correspond to the terms of the related Tax-Exempt
Bonds. Upon issuance, the terms of each series of the
Collateral Bonds will not vary during the life of such
series except for the interest rate of any such series
that bears interest at an adjustable rate.
16. For further information with respect to the terms
of the Agreement and Indenture, reference is made to
Exhibits B-5, B-6 and B-7.
17. It is contemplated that Tax-Exempt Bonds may be
sold by the Parish pursuant to arrangements with an
underwriter or a group of underwriters or by private
placement in a negotiated sale or sales. The
underwriting or placement arrangements; however, the
Agreement will provide that the terms of Tax-Exempt
Bonds, and their sale by the Parish, shall be
satisfactory to the Company and the Company would
provide certain related representations and warranties.
The Company expects that interest payable on Tax-Exempt
Bonds will not be included in the gross income of the
holders thereof for federal income tax purposes under
the provisions of Section 103 of the Internal Revenue
Code of 1986, as amended to the day of issuance of
Tax-Exempt Bonds (except for interest on any Tax-Exempt
Bond during a period in which it is held by a person
who is a "substantial user" of the Facilities or a
"related person" within the meaning of Section 147(a)
of such Code). The interest rates on tax-exempt
revenue bonds have been and are expected to be lower at
the time(s) of issuance of Tax-Exempt Bonds than the
interest rates on bonds of similar tenor, maturities
and comparable quality, interest on which is fully
subject to federal income tax.
Section D. Acquisition Program
1. The Company further proposes to use, in addition
to or as an alternative for the proceeds from the sale
of Bonds, Debentures, Entity Interests and/or
Preferred, other available funds to acquire, at any
time or from time to time prior to December 31, 1996,
in whole or in part, prior to their respective
maturities (1) one or more series of the Company's
outstanding First Mortgage Bonds, including, but not
limited to, the Company's First Mortgage Bonds, 10.36%
Series due 1995, 5-3/4% Series due March 1, 1996, 10-
1/8% Series due April 1, 2020, 8% Series due June 1,
2003, 7-1/2% Series due January 1, 2002, and 7-1/2%
Series due November 1, 2002, (2) one or more series of
the Company's outstanding Preferred Stock, including,
but not limited to the Preferred Stock, 8.56% Series
($100 Par), the Preferred Stock 10.72% Series ($25
Par), the Preferred Stock 12.64% Series ($25 Par) and
the Preferred Stock 9.68% Series ($25 Par), and (3) one
or more series of outstanding Pollution Control Revenue
Bonds and/or Industrial Development Revenue Bonds
and/or Solid Waste Disposal Revenue Bonds ("PCRBs")
issued for the benefit of the Company, including, but
not limited to, the PCRBs 8% Series 1979 (Ouachita
Parish), the PCRBs 8% Series 1979 (St. Charles Parish)
and the PCRBs 8% Series 1979 (Jefferson Parish) (such
First Mortgage Bonds, Preferred Stock, PCRBs,
collectively, the "Outstanding Securities").
2. The Company is currently precluded from redeeming
certain series of the Outstanding Securities due to
refunding restrictions. Accordingly, the Company may
decide to repurchase for cash all or a portion of one
or more such series of Outstanding Securities through
tender offer, negotiated, open market or other forms of
purchase or otherwise by means other than redemption.
The Company may also choose to acquire Outstanding
Securities of series that are not subject to refunding
limitations by means of tender offer, negotiated, open
market or other purchase, transactions or otherwise if
such means of acquisition are more beneficial to the
Company than redemption at the applicable redemption
price. If any Outstanding Securities are acquired by
means of tender offer, the Company may offer to acquire
specified amounts of a particular series or an entire
series of such Outstanding Securities.
3. The Company shall not use the proceeds from the
sale of Bonds, Debentures, Entity Interests and/or
Preferred to enter into refinancing transactions unless
(A) the estimated present value savings derived from
the net difference between interest or interest
payments on a new issue of comparable securities and
those securities refunded is, on an after-tax basis,
greater than the present value of all repurchase,
redemption, tender and issuance costs, assuming an
appropriate discount rate, determined on the basis of
the then estimated after-tax cost of capital of Entergy
Corporation and its subsidiaries, on a consolidated
basis or (B) the Company shall have notified the
Commission of the proposed refinancing transaction
(including the terms thereof) by post-effective
amendment hereto and obtained appropriate supplemental
authorization from the Commission to consummate such
transaction.
Section E. Other
1. The proceeds to be received from the issuance and
sale of the Bonds, Debentures, Entity Interests,
Preferred and Tax-Exempt Bonds will not be used to
invest directly or indirectly in an exempt wholesale
generator ("EWG") or foreign utility company ("FUCO"),
as defined in Sections 32 and 33, respectively, of the
Holding Company Act.
2. The proposed transactions are also subject to Rule
54, in determining whether to approve the issue or sale
of a security by a registered holding company for
purposes other than the acquisition of an EWG or FUCO,
or other transactions by such registered holding
company or its subsidiaries other than with respect to
EWGs or FUCOs, the Commission shall not consider the
effect of the capitalization or earnings of any
subsidiary which is an EWG or FUCO upon the registered
holding company system if Rules 53(a), (b) and (c) are
satisfied. In that regard, assuming consummation of
the transactions proposed in this application, all of
the conditions set forth in Rule 53(a) are and will be
satisfied and none of the conditions set forth in Rule
53(b) exists or, as a result thereof, will exist.
3. Entergy's "aggregate investment" in EWGs and FUCOs
is approximately $196.7 million, representing
approximately 9.67% of the Entergy System's
consolidated retained earnings as of March 31, 1995.
Furthermore, Entergy has complied with and will
continue to comply with the record keeping requirements
of Rule 53(a)(2) concerning affiliated EWGs and FUCOs.
In addition, as required by Rule 53(a)(3), no more than
2% of the employees of the Entergy System's domestic
public utility subsidiary companies would render
services to affiliated EWGs and FUCOs. Finally, none
of the conditions set forth in Rule 53(b), under which
the provisions of Rule 53 would not be available, have
been met.
Item 2. Fees, Commissions and Expenses.
The fees and expenses to be incurred in connection with the
issuance and sale of the Tax-Exempt Bonds (including the expenses
related to the issuance and pledge of the Collateral Bonds) are
estimated not to exceed the following:
Each
Initial Additional
Sale Sale
*Rating Agencies' fees $ 35,000 $ 35,000
*Trustees' fees 35,000 35,000
*Fees of Bond Counsel 70,000 55,000
*Fees of State Bond Commission 54,500 54,500
*Fees of Company's Counsel:
Monroe & Lemann (A Professional 40,000 33,000
Corporation)
Reid & Priest LLP 50,000 40,000
*Fees of Entergy Services, Inc. 30,000 20,000
*Accountants' fees 9,500 9,500
*Printing and engraving costs 25,000 25,000
*Miscellaneous expenses (including
blue-sky expenses) 26,000 23,000
-------- --------
*Total Expenses $375,000 $330,000
======== ========
___________________
*Estimated
Fees and expenses to be incurred in connection with issuance and
sale of Bonds, Debentures, Entity Interests and/or Preferred will
be supplied by amendment.
The fees, commissions and expenses of the underwriters
expected to be incurred with respect to the Bonds, Debentures,
Entity Interests, Preferred or Tax-Exempt Bonds will not exceed
the lesser of 2% (or in the case of Debentures issued under the
Subordinated Debenture Indenture or Entity Interests, 3.25%) of
the principal amount of the Bonds, Debentures, Entity Interests,
Preferred or Tax-Exempt Bonds, respectively, to be sold or those
generally paid at the time of pricing for sales of first mortgage
bonds, debentures, subsidiary interests, preferred or tax-exempt
bonds, respectively, having the same maturity, issued by
companies of comparable credit quality and having similar terms,
conditions and features.
Item 3. Applicable Statutory Provisions
Section A. Bonds, Debentures, Entity Interests and
Preferred
The Company believes that Sections 6(a) and 7 of the
Holding Company Act and Rules 23 and 24 thereunder apply to
the proposed issuance(s) and sale(s) of Bonds, Debentures,
Entity Interests and Preferred, as well as to the potential
exchange of Entity Interests for Entity Subordinated
Debentures.
The Company believes that Sections 9(a), 10 and 12(b) of
the Holding Company Act and Rule 45 thereunder apply to the
formation of the Issuing Entity, the acquisition of either
general partnership interests (in the case of a limited
partnership) or common securities (in the case of a business
trust) in the Issuing Entity, the Company's equity
contributions to the Issuing Entity, the Company's potential
acquisition of shares of the capital stock of the
Participating Subsidiary, the acquisition by the
Participating Subsidiary of partnership interests in the
Issuing Entity, and the Issuing Entity's acquisition of the
Entity Subordinated Debentures and the Guaranty.
Section B. Tax Exempt Financing
The Sections of the Holding Company Act and the rules
thereunder which the Company considers may be applicable to
the tax-exempt financing of the Facilities are set forth
below:
(i) Disposition of the Section 12(d) and Rule 44
Facilities
(ii) Reacquisition of Sections 9(a) and 10
the Facilities
(iii) Reimbursement Sections 6(a) and 7
Agreement
(iv) Issuance and Pledge Sections 6(a) and 7
of Collateral Bonds
Section C. Acquisition Program
The Company believes that Sections 9(a), 10 and 12(c)
of the Holding Company Act and amended Rule 42 thereunder
apply to the proposed acquisition of Outstanding Securities.
Pursuant to amended Rule 42, the Company may acquire, retire
or redeem any of the Outstanding Securities (other than
PCRBs) without prior Commission approval.
In the event that the Commission deems any other
section of the Holding Company Act or rule thereunder to be
applicable, the Company requests that the Commission's order
or orders herein also be issued under and with respect to
such other section or rule.
Item 4. Regulatory Approval
No state regulatory body or agency and no federal commission
or agency other than this Commission has jurisdiction over the
transactions proposed herein. Neither the Louisiana Public
Service Commission nor the Council of the City of New Orleans,
nor any other body or agency of the State of Louisiana or the
City of New Orleans, exercises jurisdiction over the transactions
proposed herein.
Item 5. Procedure
1. The Company requests that the Commission's notice
of proposed transactions published pursuant to Rule
23(e) be issued by June 23, 1995, or as soon thereafter
as practicable. The Company further requests that the
Commission's order authorizing the issuance and sale of
Bonds, Debentures, Entity Interests and Preferred, as
well as over the proposed transactions related to the
financing of the Facilities by means of Tax-Exempt
Bonds, pursuant to competitive bidding procedures,
negotiated public offering or private placement, as
described in Item 1, be entered by July 24, 1995, or as
soon thereafter as practicable. The Company consents
that the Commission's order authorizing the above
transactions reserves jurisdiction over (i) the
proposed issuance and sale of Debentures and Entity
Interests, pursuant to competitive bidding procedures,
negotiated public offering or private placement,
pending completion of the record by the filing of the
respective registration statements relating thereto;
(ii) the proposed transactions related to the financing
of the Facilities by means of Tax-Exempt Bonds, through
competitive bidding procedures, negotiated public
offering or private placement, pending completion of
the record by the filing of the Installment Sales
Agreement with respect thereto.
2. The Company hereby waives a recommended decision
by a hearing officer or any other responsible officer
of the Commission; agrees that the Staff of the
Division of Investment Management may assist in the
preparation of the Commission's decision; and requests
that there be no waiting periods between the issuance
of the Commission's orders and the dates on which they
are to become effective.
Item 6. Exhibits and Financial Statements
Section A. Exhibits
*A-1 Mortgage and Deed of Trust, dated as of April
1, 1944, as amended by fifty Supplemental
Indentures (filed, respectively, as the
exhibits and in the file numbers indicated: A-
1 in File No. 70-875 (Mortgage); A-2 in File
No. 70-1747 (First); A-l(c) in File No. 70-
2497 (Second); A-5 in File No. 70-3126
(Third); A-6 in File No. 70-3297 (Fourth); A-6
in File No. 70-3539 (Fifth); A-7 in File No.
70-3862 (Sixth); A-8 in File No. 70-4209
(Seventh); A-2 in File No. 70-4350 (Eighth); A-
2 in File No. 70-4439 (Ninth); A-2 in File No.
70-4512 (Tenth); A-2 in File No. 70-4585
(Eleventh); A-2 in File No. 70-4700 (Twelfth);
A-2 in File No. 70-4793 (Thirteenth); A-2 in
File No. 70-4921 (Fourteenth); A-2 in File No.
70-4982 (Fifteenth); A-2 in File No. 70-5122
(Sixteenth); A-2(a) in File No. 70-5242
(Seventeenth); A-2 in File No. 70-5330
(Eighteenth); A-2 in File No. 70-5449
(Nineteenth); A-2 in File No. 70-5550
(Twentieth); A-6 in File No. 70-5598 (Twenty-
first); A-2 in File No. 70-5711 (Twenty-
second); A-2 in File No. 70-5919 (Twenty-
third); C-1 to Rule 24 Certificate in File No.
70-6102 (Twenty-fourth); C-1 to Rule 24
Certificate in File No. 70-6169 (Twenty-
fifth); C-1 to Rule 24 Certificate in File No.
70-6278 (Twenty-sixth); C-1 to Rule 24
Certificate in File No. 70 6355 (Twenty-
seventh); C-1 to Rule 24 Certificate in File
No. 70-6508 (Twenty-eighth); C-1 to Rule 24
Certificate in File No. 70-6556 (Twenty-
ninth); C-1 to Rule 24 Certificate, dated
December 1, 1981, in File No. 70-6635
(Thirtieth); C-1 to Rule 24 Certificate, dated
March 1, 1983, in File No. 70-6834 (Thirty-
first); C-1 to Rule 24 Certificate, dated
September 1, 1983, in File No. 70-6886 (Thirty-
second); C-1 to Rule 24 Certificate, dated
August 30, 1984, in File No. 70-6993 (Thirty-
third); C-2 to Rule 24 Certificate, dated
November 7, 1984, in File No. 70-6993
(Thirty-fourth); C-3 to Rule 24 Certificate,
dated December 19, 1984, in File No. 70-6993
(Thirty-fifth); A-2(a) to Rule 24 Certificate,
in File No. 70-7166 (Thirty-sixth); A-2(a) in
File No. 70-7226; (Thirty-seventh); C-1 to
Rule 24 Certificate in File No. 70-7270
(Thirty-eighth); 4(a) to Quarterly Report on
Form 10-Q for the Quarter ended June 30, 1988
in File No. 1-8474 (Thirty-ninth); A-2 (b) to
Rule 24 Certificate, dated December 23, 1988,
in File No. 70-7553 (Fortieth); A-2(d) to Rule
24 Certificate, dated April 12, 1990, in File
No. 70-7553 (Forty-first); A-3(a) to Rule 24
Certificate dated August 9, 1991, in File No.
70-7822 (Forty-second); A-3(b) to Rule 24 Certificate
dated April 23, 1992, in File No. 70-7822
(Forty-third); A-2(b) to Rule 24 Certificate
dated July 30, 1992, in File No. 70-7822
(Forty-fourth); A-3(c) to Rule 24 Certificate
dated December 23, 1992, in File No. 70-7822
(Forty-fifth); A-2(c) to Rule 24 Certificate
dated April 7, 1993, in File No. 70-7822
(Forty-sixth); A-3(d) to Rule 24 Certificate
dated June 4, 1993, in File No. 70-7822 (Forty-
seventh); A-3(e) to Rule 24 Certificate dated
December 21, 1993 in File No. 70-7822 (Forty-
eighth); A-3(e) to Rule 24 Certificate dated
August 1, 1994, in File No. 70-7822 (Forty-
ninth); and A-4(c) to Rule 24 Certificate
dated September 28, 1994 in File No. 70-7653
(Fiftieth).
**A-2 Proposed form(s) of additional Supplemental
Indenture(s) relating to the Bonds.
**A-3 Proposed form(s) of additional Supplemental
Indenture(s) relating to the Collateral Bonds.
**A-4 Proposed form(s) of Bond.
**A-5 Proposed form(s) of Collateral Bond.
*A-6 Restated Articles of Incorporation dated
February 21, 1980, as amended through of LP&L,
filed as Exhibit 3(a) to Quarterly Report on
Form 10-Q for the quarter ended June 30, 1994
in File No. 1-8474.
*A-7 By-laws, as presently in effect (filed as
Exhibit A-4 in File No. 70-6962).
**A-8 Proposed form(s) of Preferred Stock
Certificate relating to fixed dividend rate
stock.
**A-9 Proposed form(s) of Preferred Stock
Certificate relating to adjustable dividend
rate stock.
**A-10 Proposed form(s) of Debenture Indenture.
**A-11 Proposed form(s) of Debenture.
**A-12 Proposed form(s) of Subordinated Debenture
Indenture.
**A-13 Proposed form(s) of Subordinated Debenture.
**A-14 Proposed form(s) of Entity Subordinated
Debenture Indenture.
**A-15 Proposed form(s) of Entity Subordinated
Debenture.
**A-16 Proposed form(s) of Entity Agreement of the
Issuing Entity, including the proposed form(s)
of Entity Interests.
**A-17 Proposed form(s) of Certificate of
Incorporation of the Participating Subsidiary
(if applicable).
**A-18 Proposed form(s) of Bylaws of the
Participating Subsidiary (if applicable).
**A-19 Proposed form(s) of Guaranty (if applicable).
**B-1 Proposed form of letter to prospective
purchasers relating to proposals for the
purchase of Bonds.
**B-2 Proposed form(s) of agreement for sale(s) of
Bonds.
**B-3 Proposed form of letter to prospective
purchasers relating to proposals for the
purchase of Preferred.
**B-4 Proposed form(s) of agreement for sale(s) of
Preferred.
**B-5 Proposed form(s) of Indenture.
**B-6 Proposed form(s) of Installment Sale
Agreement.
**B-7 Proposed form(s), if any, of Second Mortgage.
**B-8 Proposed form of letter to prospective
purchasers relating to proposals for the
purchase of Debentures.
**B-9 Proposed form(s) of agreement for sale(s) of
Debentures.
**B-10 Proposed form of letter to prospective
purchasers relating to proposals for the
purchase of Entity Interests.
**B-11 Proposed form(s) of agreement for sale(s) of
Entity Interests.
*C-1 Registration Statement, No. 33-33607 relating
to Bonds, (filed in Registration No. 33-
50937).
*C-2 Registration Statement No. 33-46085, relating
to Bonds and Preferred (filed in Registration
No. 33-46085).
*C-3 Registration Statement No. 33-39221 relating
to Bonds and Preferred (filed in Registration
No. 33-39221).
*C-4 Registration Statement No. 33-50937 relating
to Bonds and Preferred (filed in Registration
No. 33-50937).
**C-5 Proposed form of Registration Statement
relating to Debentures.
**C-6 Proposed form of Registration Statement
relating to Subordinated Debentures.
**C-7 Proposed form of Registration Statement
relating to Entity Subordinated Debentures and
Entity Interests.
D Inapplicable.
E Inapplicable.
**F-1 Opinion(s) of Laurence M. Hamric, General
Attorney-Corporate and Securities and/or
Denise C. Redmann, Senior Attorney, Corporate
and Securities, of Entergy Services, Inc.
**F-2 Opinion(s) of Monroe & Lemann (A Professional
Corporation).
**F-3 Opinion(s) of Reid & Priest LLP.
G Plan of Financing for the Company and
Financial Data Schedules (filed with original
Form U-1).
H-l Suggested form of notice of proposed
transactions for publication in the Federal
Register (filed with original Form U-1).
H-2 Revised suggested form of notice of proposed
transactions for publication in the Federal
Register.
_________________________
* Incorporated herein by reference as indicated.
** To be filed by amendment.
Section B. Financial Statements
Financial Statements of the Company as of June 30, 1994
(reference is made to Exhibit G hereto).
Financial Statements of Entergy Corporation and
subsidiaries, consolidated, as of June 30, 1994.
Notes to financial statements of the Company and
Entergy Corporation and subsidiaries included in the Annual
Report on Form 10-K for the fiscal year ended December 31,
1994 and the Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 1995 (filed in File Nos. 1-8474 and 1-
11299, respectively, incorporated by reference).
Except as reflected in the Financial Statements, no
material changes not in the ordinary course of business have
taken place since June 30, 1994.
Reference is made to Exhibit G hereto for a statement
of (i) the approximate amounts, before and after giving
effect to the proposed transactions, of unfunded bondable
property of the Company available for the issuance of First
Mortgage Bonds and (ii) the proposed accounting treatment of
the transactions herein contemplated.
Item 7. Information as to Environmental Effects
(a) As stated in Item 5, the Company would appreciate
receiving the order of the Commission in this File
authorizing, subject to the reservations of
jurisdiction set forth above, the transactions proposed
herein by July 24, 1995. As more fully described in
Item 1, the proposed transactions subject to the
jurisdiction of the Commission relate only to the
financing activities of the Company and do not involve
a major federal action having a significant impact on
the human environment.
(b) Not applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this
statement to be signed on its behalf by the undersigned thereunto
duly authorized.
LOUISIANA POWER & LIGHT COMPANY
By: /s/ Michael G. Thompson
Michael G. Thompson
Senior Vice President,
General Counsel and Secretary
Dated: June 28, 1995
EXHIBIT H-2
Form of Notice of Proposed Transactions
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- ; 70-8487
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
LOUISIANA POWER & LIGHT COMPANY ("COMPANY")
NOTICE OF PROPOSAL TO ISSUE AND SELL UP TO (i) $610 MILLION OF
THE COMPANY'S FIRST MORTGAGE BONDS ("BONDS"), THE COMPANY'S
DEBENTURES ("DEBENTURES"), AND THROUGH A SUBSIDIARY OF THE
COMPANY, SUCH SUBSIDIARY'S PREFERRED SECURITIES ("ENTITY
INTERESTS"); (ii) $123.5 MILLION OF THE COMPANY'S PREFERRED
STOCK, EITHER $25 PAR VALUE OR $100 PAR VALUE; (iii) $65 MILLION
TAX-EXEMPT BONDS TO BE ISSUED BY THE APPROPRIATE GOVERNMENTAL
AUTHORITY, INCLUDING THE PLEDGE OF THE COMPANY'S BONDS UP TO $75
MILLION AS SECURITY; AND (iv) TO ACQUIRE THE COMPANY'S
OUTSTANDING FIRST MORTGAGE BONDS AND/OR PREFERRED STOCK AND/OR
POLLUTION CONTROL REVENUE BONDS AND INDUSTRIAL DEVELOPMENT
REVENUE BONDS PREVIOUSLY ISSUED FOR THE COMPANY'S BENEFIT
, 1995
Notice is hereby given that the following filing(s) has/have
been made with the Commission pursuant to provisions of the Act
and rules promulgated thereunder. All interested persons are
referred to the application(s) and/or declaration(s) for complete
statements of the proposed transaction(s) summarized below. The
application(s) and/or declaration(s) and any amendments thereto
is/are available for public inspection through the Commission's
Office of Public Reference.
Interested persons wishing to comment or request a hearing
on the application(s) and/or declaration(s) should submit their
views in writing by July __, 1995 to the Secretary, Securities
and Exchange Commission, Washington, D.C. 20549, and serve a copy
on the relevant applicant(s) and/or declarant(s) at the
address(es) specified below. Proof of service (by affidavit or,
in case of an attorney at law, by certificate) should be filed
with the request. Any request for hearing shall identify
specifically the issues of fact or law that are disputed. A
person who so requests will be notified of any hearing, if
ordered, and will receive a copy of any notice or order issued in
the matter. After said date, the application(s) and/or
declaration(s), as filed or as amended, may be granted and/or
permitted to become effective.
Louisiana Power & Light Company (70-8487)
Louisiana Power & Light Company ("LP&L"), 639 Loyola Avenue,
New Orleans, Louisiana 70113, an electric utility subsidiary of
Entergy Corporation, a registered holding company, has filed an
application-declaration pursuant to Sections 6(a), 7, 9(a), 10,
12(c) and 1 2(d) of the Act and Rules 23, 24, 42 and 44
thereunder.
LP&L seeks authorization to issue and sell, directly or
indirectly through a subsidiary, not more than $610,000,000
principal amount of its first mortgage bonds ("Bonds"),
debentures ("Debentures") and preferred securities of a
subsidiary of LP&L ("Entity Interests") to be issued in one or
more new series from time to time no later than December 31,
1997. Each series of Bonds and/or each series of Debentures will
be sold at such price, will bear interest at such rate, either
fixed or adjustable, and will mature on such date as will be
determined at the time of sale. LP&L may determine to provide an
insurance policy for the payment of the principal of and/or
interest and/or premium on one or more series of Bonds and/or one
or more series of Debentures. Each series of Entity Interests
will have a $25 per share stated liquidation preference and will
be sold at such price and will be entitled to receive
distributions at such rate, either fixed or adjustable, on such
periodic basis as will be determined, along with the maturity, at
the time of sale. One or more series of Bonds and/or Debentures
and/or Entity Interests may include provisions for redemption or
retirement prior to maturity, including restrictions on optional
redemption for a given number of years.
LP&L further proposes to issue and sell, from time to time
not later than December 31, 1997, one or more new series of its
preferred stock, cumulative, of either $25 par value or $100 par
value (collectively, the "Preferred"). The total aggregate par
value of shares of those new series of the Preferred may not
exceed $123,500,000. The price, exclusive of accumulated
dividends, and the dividend rate for each series of Preferred
will be determined at the time of sale. LP&L may determine that
the terms of the Preferred should provide for an adjustable
dividend rate thereon to be determined on a periodic basis,
subject to specified maximum and minimum rates, rather than a
fixed dividend rate. The terms of one or more series of the
Preferred may include provisions for redemption, including
restrictions on optional redemption, and/or a sinking fund
designed to redeem all outstanding shares of such series not
later than thirty years after the date of original issuance.
LP&L proposes to use the net proceeds derived from the
issuance and sale of Bonds and/or the Debentures and/or the
Entity Interests and/or the Preferred for general corporate
purposes, including, but not limited to, the possible acquisition
of certain outstanding securities.
LP&L states that it presently contemplates selling the
Bonds, the Debentures, the Entity Interests and the Preferred
either by competitive bidding, negotiated public offering or
private placement.
LP&L also proposes to enter into arrangements to finance on
a tax-exempt basis certain solid waste, sewage disposal and/or
pollution control facilities ("Facilities") at any of (i) Unit
No. 3 of its Waterford Steam Electric Generating Station in the
Parish of St. Charles, Louisiana, (ii) Units Nos. 6 and 7 of the
Company's Sterlington Gas Generating Station in the Parish of
Ouachita, Louisiana, or (iii) Units Nos. 1-5 of the Company's
Ninemile Point Gas Generating Station in the Parish of Jefferson,
Louisiana (collectively, St. Charles Parish, Ouachita Parish and
Jefferson Parish all referred to as the "Parish"). LP&L proposes,
from time to time through December 31, 1997, to enter into one or
more installment sale agreements and supplements ("Agreement"),
pursuant to which the Parish may issue one or more series of
tax-exempt revenue bonds ("Tax-Exempt Bonds") in an aggregate
principal amount not to exceed $65,000,000. The net proceeds from
the sale of Tax-Exempt Bonds will be deposited by the Parish with
the trustee ("Trustee") under one or more indentures
("Indenture") and will be applied by the Trustee to reimburse the
Company for, or to permanently finance on a tax-exempt basis, the
costs of the acquisition, construction, installation or equipping
of the Facilities.
LP&L further proposes, under the Agreement, to sell the
Facilities to the Parish for cash and simultaneously repurchase
the Facilities from the Parish for a purchase price, payable on
an installment basis over a period of years, sufficient to pay
the principal of purchase price of, the premium, if any, and the
interest on Tax-Exempt Bonds as the same become due and payable.
Under the Agreement, LP&L will also be obligated to pay certain
fees incurred in the transactions.
The price to be paid to the Parish for each series of
Tax-Exempt Bonds and the interest rate applicable thereto will be
determined at the time of sale. The Agreement and the Indenture
will provide for either a fixed interest rate or an adjustable
interest rate for each series of the Tax-Exempt Bonds. Each
series may be subject to optional and mandatory redemption and/or
a mandatory cash sinking fund under which stated portions of such
series would be retired at stated times.
In order to obtain a more favorable rating and thereby
improve the marketability of the Tax-Exempt Bonds, LP&L may (1)
arrange for a letter of credit from a bank ("Bank") in favor of
the Trustee (in connection therewith, LP&L may enter into a
Reimbursement Agreement pursuant to which LP&L would agree to
reimburse the Bank for amounts drawn under the letter of credit
and to pay commitment and/or letter of credit fees), (2) provide
an insurance policy for the payment of the principal of and/or
interest and/or premium on one or more series of Tax-Exempt
Bonds, and/or (3) obtain authentication of one or more new series
of First Mortgage Bonds ("Collateral Bonds") to be issued under
LP&L's Mortgage on the basis of unfunded net property additions
and/or previously retired First Mortgage Bonds and delivered and
pledged to the Trustee and/or the Bank to evidence and secure
LP&L's obligations under the Agreement and/or the Reimbursement
Agreement.
LP&L also proposes to acquire, through tender offers or
otherwise, certain of its outstanding securities, including its
outstanding first mortgage bonds, its outstanding preferred stock
and/or outstanding pollution control revenue bonds and industrial
development revenue bonds issued for LP&L's benefit, at any time,
prior to December 31, 1997.
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
Jonathan G. Katz
Secretary
