File No. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form U-1
APPLICATION DECLARATION
under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Entergy Corporation
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)
Naomi Nakagama
Senior Vice President - Finance and Treasurer
Entergy Services, Inc.
639 Loyola Avenue
New Orleans, Louisiana 70113
(Name and address of agent for service)
The Commission is also requested to send copies of any
communications in connection with this matter to:
Laurence M. Hamric, Esq. William T. Baker, Jr., Esq.
Ann G. Roy, Esq. Reid & Priest LLP
Entergy Services, Inc. 40 West 57th Street
639 Loyola Avenue New York, New York 10019
New Orleans, Louisiana 70113
<PAGE>
Item I. Description of Proposed Transactions.
Entergy Corporation ("Entergy"), a public utility
holding company registered with the Securities and Exchange
Commission ("Commission") under the Public Utility Holding
Company Act of 1935, as amended (the "Act"), hereby proposes
certain transactions relating to the adoption of its 1998 Equity
Ownership Plan of Entergy Corporation and Subsidiaries ("Equity
Plan"), as more fully described herein.
The Equity Plan will be an amendment and restatement of
Entergy's current Equity Ownership Plan which was approved by its
stockholders in 1991 and authorized by the Commission pursuant to
an Order, dated March 28, 1991 (Release No. 35-252840), in
Commission file number 70-7831. There are no material
differences between the Equity Plan and Entergy's prior Equity
Ownership Plan except that awards granted under the Equity Plan
are intended to qualify as performance based compensation under
Section 162(m) of the Internal Revenue Code of 1986, as amended
(the "Code").
A. Description of Equity Plan
Under the Equity Plan, awards may be granted to certain
designated officers and executive personnel ("key employees") of
Entergy and those companies with respect to which Entergy owns,
or directly or indirectly controls, a majority of the combined
voting power (hereinafter, the "Subsidiaries") and members of the
Board of Directors of Entergy who are not otherwise employed by
Entergy or the Subsidiaries. The purpose of the Equity Plan is
to give key employees and outside directors an opportunity to
acquire shares of the Common Stock, $0.01 par value, of Entergy
("Common Stock"), to more closely tie the interests of key
employees and outside directors to those of Entergy's
stockholders, and to reward the effective leadership of Entergy
and the Subsidiaries through the use of equity incentives. Key
employees are those who, in the opinion of the Committee (as
defined below), have significant responsibility for the continued
growth, development and financial success of Entergy and the
Subsidiaries.
The Equity Plan provides for several mechanisms for
building the equity holdings of key employees and outside
directors. These mechanisms include: (1) stock options, which
may be either nonstatutory stock options or incentive stock
options as provided in Section 422 of the Code ("Options"); (2)
shares of Common Stock, which vest over a period of time
("Restricted Shares"); (3) shares of Common Stock which are
awarded upon attainment of specified performance goals
("Performance Shares"); or (4) equity awards in the form of
phantom stock units ("Equity Awards"). The Committee may select
from among these mechanisms when making awards under the Equity
Plan.
A maximum of 12,000,000 shares of Common Stock will be
available for awards under the Equity Plan, subject to adjustment
due to stock dividends, stock splits, recapitalizations, mergers,
consolidations or other reorganizations. Shares of Common Stock
awarded under the Equity Plan may be either authorized but
unissued shares or shares acquired in the open market. Shares of
Common Stock covered by awards which are not earned, or which are
forfeited for any reason, and Options which expire unexercised,
will again be available for subsequent awards under the Equity
Plan. To the extent that shares of Common Stock previously held
in a participant's name are surrendered upon the exercise of an
Option or shares relating to an award are used to pay withholding
taxes, such shares shall become available for subsequent awards
under the Equity Plan.
The Equity Plan will be administered by the Personnel
Committee of the Board of Directors of Entergy or such other
committee ("Committee") as the Board may determine is qualified,
to the extent required, to administer the Equity Plan in
accordance with Rule 16b-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The Committee will have
the full power under the Equity Plan to select from among
eligible key employees and outside directors those individuals to
whom awards will be granted, to grant any combination of awards
to any participants and to determine the specific terms and
conditions of each award. The Committee will also have the
exclusive authority to interpret the Equity Plan.
For further information concerning the Equity Plan,
reference is made to Exhibit A-3 hereto.
B. Issuance of Securities
Entergy hereby requests authority from time to time
during the period through December 31, 2008 to grant Options,
Restricted Shares, Performance Shares and Equity Awards pursuant
to the Equity Plan and, in connection therewith, to issue or sell
up to 12,000,000 shares of Common Stock to eligible key employees
and outside directors under the Equity Plan.
Entergy intends to register the securities to be issued
or sold under the Equity Plan under the Securities Act of 1933,
as amended, as soon as practicable following the receipt of the
authorization requested herein.
C. Solicitation of Proxies
In accordance with the requirements of Rule 16b-3 under
the Exchange Act, the Equity Plan will be submitted to the
stockholders of Entergy for approval at the Annual Meeting of
Stockholders to be held May 15, 1998. Such approval requires the
affirmative vote of the holders of a majority of the shares of
Common Stock represented and entitled to vote at the meeting.
Entergy proposes to solicit proxies from its stockholders for use
at the 1998 Annual Meeting with respect to the approval of the
Equity Plan. Authority is hereby requested pursuant to Section
12(e) of the Act and Rule 62 thereunder for Entergy to engage in
such solicitation. Exhibit I-1 hereto contains information with
respect to the manner in which the solicitation of proxies is
proposed to be made and includes a description of the proposed
Equity Plan to be submitted and acted upon at the Annual Meeting.
A form of Proxy proposed to be sent to stockholders is filed as
Exhibit I-2 hereto. Entergy proposes to mail its proxy
solicitation material on or about March 30, 1998, to stockholders
of record on March 16, 1998.
In order to permit sufficient time for the preparation
and mailing of such solicitation material, Entergy hereby
requests that the Commission issue an order pursuant to
Rule 62(d) under the Act, concurrent with the publication of the
Notice of the transactions proposed herein, authorizing Entergy
to solicit proxies from its stockholders for approval of the
Equity Plan, subject to a reservation of jurisdiction over the
proposed issuance of securities pursuant to such Plan pending
completion of the record herein.
D. Compliance with Rules 53 and 54
Entergy hereby represents that, pursuant to Rule 54
under the Act, (1) for the reasons discussed below, the condition
set forth in Rule 53(a)(1) that Entergy's "aggregate investment"
in EWGs and FUCOs not exceed 50% of Entergy's "consolidated
retained earnings" is not currently satisfied, and (2) all of the
other criteria of Rule 53(a) and (b) are satisfied.
Entergy's "aggregate investment" in EWGs and FUCOs as
of December 31, 1997 was equal to approximately 51.8% of
Entergy's "consolidated retained earnings." Entergy's aggregate
investment in EWGs and FUCOs exceeds the 50% limitation in Rule
53(a)(1) as a result of a decrease of approximately $140 million
in Entergy's consolidated retained earnings from the quarter
ended June 30, 1997 to the quarter ended September 30, 1997.
This decrease was attributable wholly to the recording in July
1997 of a one-time "windfall profits tax" imposed by the British
government on London Electricity plc ("London Electricity"), an
indirect subsidiary of Entergy and a FUCO, and other privatized
companies in the United Kingdom. This tax, which was
approximately US$234 million for London Electricity, was made
payable in two installments, the first of which was paid on
December 1, 1997, and the second of which will be due on December
1, 1998. The first installment of the tax was paid by London
Electricity, without need for additional investment by Entergy,
and it is not anticipated that there will be a need for any
additional investment by Entergy to fund London Electricity's
payment of the second installment.
Item 2. Fees, Commissions and Expenses.
The fees, commissions and expenses estimated to be
incurred in connection with the proposed transactions will be
supplied by amendment.
Item 3. Applicable Statutory Provisions.
It is believed that Sections 6(a), 7 and 12(e) of the
Act and Rules 23, 24, 53, 54, 62 and 65 thereunder are applicable
to the proposed transactions. To the extent that the
transactions proposed herein are considered by the Commission to
require authorization, approval or exemption under any section of
the Act or provision of the rules or regulations thereunder other
than those specifically referred to herein, request for such
authorization, approval or exemption is hereby made.
Item 4. Regulatory Approval.
No state or federal commission, other than the
Commission, has jurisdiction over the proposed transactions.
Item 5. Procedure.
Entergy hereby requests that the Commission issue its
order pursuant to Rule 62(d) under the Act authorizing Entergy to
solicit proxies for use at Entergy's 1998 Annual Meeting of
Stockholders in connection with the approval of the Equity Plan
at the earliest practicable date, but in any event no later than
March 27, 1998, and that the Commission issue its subsequent
order approving the issuance by Entergy of the various securities
provided under the Equity Plan, as described herein, no later
than May 15, 1998. Entergy 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 upon which
they are to become effective.
Item 6. Exhibits and Financial Statements.
(a) Exhibits:
*A-1 - Certificate of Incorporation of Entergy
(filed as Exhibit A-1(a) to Rule 24
Certificate in 70-8059).
*A-2 - By-Laws of Entergy, as presently in effect
(filed as Exhibit A-2(a) to Rule 24
Certificate in 70-8059).
A-3 - 1998 Equity Ownership Plan of Entergy
Corporation and Subsidiaries.
B - Not Applicable.
**C - Registration Statement with respect to
the Equity Plan.
D - Not Applicable.
E - Not Applicable.
F - Opinion of Laurence M. Hamric, Esq., counsel
for Entergy.
G - Not Applicable.
H - Suggested form of Notice of Proposed Transactions,
including Order permitting solicitation
of proxies.
I-1 - Proposed Excerpts from Proxy Statement relating
to Equity Plan.
I-2 - Proposed form of Proxy.
(b) Financial Statements:
Financial Statements are omitted since they are not
deemed relevant or necessary for a proper disposition of the
proposed transactions by the Commission.
* Incorporated herein by reference as indicated.
** To be supplied by amendment.
Item 7. Information as to Environmental Effects.
(a) The proposed transactions described herein relate
to the solicitation of proxies and the issuance or sale of
securities and do not involve a major federal action having a
significant impact on the human environment.
(b) Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Public Utility
Holding Company Act of 1935, the undersigned company has duly
caused this Application-Declaration to be signed on its behalf by
the undersigned thereunto duly authorized.
ENTERGY CORPORATION
By: /s/ Michael G. Thompson
Michael G. Thompson
Senior Vice President,
General Counsel
and Secretary
Dated: March 17, 1998
Exhibit A-3
1998 EQUITY OWNERSHIP PLAN
OF
ENTERGY CORPORATION AND SUBSIDIARIES
ARTICLE I
PURPOSE
1.1 Purpose. The purpose of this 1998 Equity Ownership Plan of the
Entergy Corporation and Subsidiaries (the "Plan") is to give key
employees and outside directors of Entergy Corporation (or
"Entergy" as defined in Section 2.5 below) and corporations with
respect to which Entergy owns, or directly or indirectly
controls, the majority of the combined voting power
("Subsidiaries") (hereinafter Entergy and Subsidiaries shall be
collectively referred to as "Companies" ) an opportunity to
acquire shares of Common Stock (as defined in Section 2.3 below),
to more closely tie the interests of key employees and outside
directors to those of Entergy shareholders and to reward the
effective leadership of the Companies through the use of equity
incentives.
1. 2 Scope and Duration
(a) Awards under the Plan may be granted in the following forms:
(i) Options ("Options") as described in Article V, including, without
limitation, Incentive Stock Options ("Incentive Stock Options")
as provided in Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code" ), and related equity maintenance rights
as described in Article V;
(ii) Shares of Common Stock of Entergy which are restricted as
provided in Article VI ( "Restricted Shares" );
(iii)Shares of Common Stock of Entergy which are subject to attainment
of certain Performance Goals during a Performance Period as
provided in Article VII ( "Performance Shares" ); and
(iii)Equity Awards and related benefits as described in Article
VIII ( "Equity Awards" ).
(b) Subject to Section 10.1, the maximum aggregate of twelve million
(12,000,000) shares of Common Stock shall be available for
delivery pursuant to Awards (as defined in Section 2.1) of
Options, Restricted Shares, Performance Shares, Equity Awards or
Additional Equity Awards granted from time to time under the
Plan. Shares of Common Stock delivered under this Plan shall be
authorized but unissued shares or open market shares of Entergy.
Shares of Common Stock purchased on the open market shall be
purchased and held, in such manner, as from time to time
determined by the Committee, so that such shares are not returned
to the status of authorized but unissued shares of Entergy but
are available for Awards under the Plan. Shares of Common Stock
covered by Awards which are not earned, or which are forfeited or
terminated for any reason, and Options which expire unexercised
or which are exchanged for other Awards, shall again be available
for subsequent Awards under the Plan. Shares received in
connection with the exercise of Options by delivery of other
shares of Common Stock, and shares related to that portion of an
Award utilized for the payment of withholding taxes shall again
be available for Awards under the Plan. Shares of Common Stock
which are surrendered by reason of forfeiture, or which are
received in connection with the exercise of Options by delivery
of other shares of Common Stock, shall be held by such person or
persons (including, but not limited to, Entergy, any Subsidiary,
or any employee or agent thereof, or any agent of the Plan), and
in such manner, as from time to time shall be directed by the
Committee, so that such shares are not returned to the status of
authorized but unissued shares of Entergy, but are available for
subsequent Awards under the Plan. Except to the extent used for
the payment of withholding taxes, cash dividends or cash dividend
equivalents, any Award, or portion thereof, which is settled in
cash shall be applied against the maximum allocation of shares.
Shares of Common Stock that are delivered to a Participant under
the Plan as a result of the reinvestment of cash dividends or
dividend equivalents in conjunction with Awards shall be applied
against the maximum allocation of shares.
ARTICLE II
DEFINITIONS
The following words and phrases shall have the respective meanings
under the Plan as hereinafter set forth unless the context clearly
requires a different meaning:
2.1 "Award" shall mean the beneficial interest in or right to any
Option, Restricted Shares, Performance Shares or Equity Awards
granted from time to time under the Plan by the Committee subject
to such restrictions, terms and conditions as the Committee may
determine.
2.2 "Board" shall mean the Board of Directors of Entergy Corporation.
2.3 "Code" shall mean the Internal Revenue Code of 1986, as amended.
Reference in the Plan to any section of the Code shall be deemed
to include any amendment or successor provisions to such section
and any regulation under such section.
2.4 "Committee" shall mean the Committee provided for in Section 3.1.
2.5 "Common Stock" shall mean shares of common stock of Entergy
Corporation and the common stock of any successor corporation by
merger or reorganization.
2.6 "Covered Participant" shall mean a Participant who is a "covered
employee" as defined in Section 162(m)(3) of the Code, and the
regulations promulgated thereunder, or who the Committee believes
will be such a covered employee for a Plan Year, and who the
Committee believes will have remuneration in excess of $1,000,000
for the applicable period, as provided in Section 162(m) of the
Code.
2.7 "Employer" shall, except as otherwise determined by the
Committee, mean, with respect to a given Participant and a given
Award, Entergy or the Subsidiary for whom such Participant is
employed at the time an Award is granted under this Plan.
2.8 "Entergy" shall mean Entergy Corporation, a Florida corporation,
and any successor of such corporation as a result of any
reorganization or merger.
2.9 "Equity Award" shall mean an Award of a unit whose value is
related to the value of shares of Common Stock but does not
represent actual shares of Common Stock at the time such an Award
is granted.
2.10 "Fair Market Value" shall mean the closing price of the Common
Stock as reported on the New York Stock Exchange Composite Tape
on the date the respective Award is granted or such other value
as the Committee may determine represents the then current traded
value of a share of Common Stock.
2.11 "Options" shall mean any nonstatutory stock options or Incentive
Stock Options (as defined in Section 5.3), or both, granted under
the Plan.
2.12 "Participant" shall mean any key employee or outside director who
is granted an Award under the Plan.
2.13 "Performance Goals" shall mean the goals for a Performance Period
which are established by the Committee against which performance
will be measured.
2.14 "Performance Period" shall mean the period designated by the
Committee during which Performance Goals must be attained.
2.15 "Performance Shares" shall mean shares of Common Stock of Entergy
Corporation which are awarded subject to attainment of
Performance Goals during the applicable Performance Period.
2.16 "Plan" shall mean the 1998 Equity Ownership Plan of Entergy
Corporation and Subsidiaries, as from time to time amended.
2.17 "Restricted Shares" shall mean shares of Common Stock of Entergy
Corporation which are awarded subject to restrictions on the
holder's right to sell, transfer, pledge or assign such shares
and with such other restrictions as the Committee may determine
in accordance with the provisions of Article VI of the Plan.
ARTICLE III
ADMINISTRATION
3.1 Committee. The Plan shall be administered by the Personnel
Committee or any successor thereto of the Board or such other
committee as determined by the Board (the "Committee"). The
Committee shall be comprised solely of two or more outside
directors of the Board within the meaning of Section 162(m) of
the Code and who are also non-employee directors within the
meaning of Rule 16b-3, as amended, or other applicable rules
under Section 16(b) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
3.2 Powers of Committee. The Committee shall have plenary authority
in its discretion, subject to and not inconsistent with the
express provisions of this Plan:
(a) To grant Options, to determine the purchase price of the Common
Stock covered by each Option, the term of each Option, the key
employees and outside directors to whom, and the time or times at
which Options shall be granted and the number of shares to be
covered by each Option;
(b) To designate Options as nonstatutory stock options or Incentive
Stock Options and to determine which Options, if any, shall be
accompanied by additional equity maintenance rights as described
in Section 5.2;
(c) To grant Restricted Shares and to determine the term of the
Restricted Period (as defined in Article VI) and restrictions,
forfeiture provisions and other conditions applicable to such
Restricted Shares, the key employees and outside directors to
whom, and the time or times at which, Restricted Shares shall be
granted;
(d) To grant Performance Shares and to determine the Performance
Goals, Performance Period and other conditions applicable to such
Performance Shares, the key employees and outside directors to
whom, and the time or times at which, Performance Shares shall be
granted;
(e) To grant or establish Equity Award Accounts pursuant to the terms
of Article VIII, to determine restrictions related to such Equity
Awards and any allocations to or distributions from such Equity
Award Accounts, the key employees and outside directors to whom
and the time or times when participation therein shall be
permitted hereunder and the number of Equity Awards to be
allocated to such Equity Award Accounts for Participants;
(e) To interpret the Plan subject to the terms of Section 3.4;
(g) To prescribe, amend and rescind rules and regulations relating to
the Plan subject to the terms of Section 3.4;
(h) To determine the terms and provisions of the Options, Restricted
Shares, Performance Shares or Equity Award agreements (which need
not be identical) and to cause the respective Employers to enter
into such agreements with such Participants in connection with
Awards under the Plan; and to make all other determinations
deemed necessary or advisable for the administration of the Plan.
3.3 Delegation of Duties. With the exception of the authority to
grant Awards to persons subject to Sections 16(a) and 16(b) of
the Exchange Act, to persons who are Covered Participants, or to
make other determinations regarding such persons the Committee
may delegate to one or more of its members or to one or more
agents such administrative duties as it may deem advisable, and
the Committee or any person to whom it has delegated duties as
aforesaid may employ one or more persons to render advice with
respect to any responsibility the Committee or such person may
have under the Plan. The Committee may employ attorneys,
consultants, accountants or other persons and the Committee,
Entergy and its officers and directors shall be entitled to rely
upon the advice, opinions or evaluations of any such persons.
However, the Committee may not delegate its authority if such
delegation would cause the Plan not to comply to the extent
required with the requirements of Rule 16b-3 or any successor
rule under the Exchange Act or with the requirements of Section
162(m) of the Code.
3.4 Interpretations. All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final
and binding upon all Participants, Entergy and all other
interested persons. No member or agent of the Committee shall be
personally liable for any action, determination, or
interpretation made in good faith with respect to the Plan or
Awards made hereunder, and all members and agents of the
Committee shall be fully protected by Entergy in respect of any
such action, determination or interpretation. Subject to the
express provisions of the Plan, the Committee may interpret the
Plan, prescribe, amend and rescind rules and regulations relating
to it, determine the terms and provisions of the respective
Awards and make all other determinations it deems necessary or
advisable for the administration of the Plan.
3.5 Non-Uniform Determinations. The Committee's determinations under
the Plan, including without limitation, determinations as to the
key employees or outside directors to receive Awards, the terms
and provisions of such Awards and the agreement(s) evidencing the
same, need not be uniform and may be made by it selectively among
the key employees or outside directors who receive or are
eligible to receive Awards under the Plan, whether or not such
key employees or outside directors are similarly situated.
ARTICLE IV
PARTICIPATION
4.1 Eligibility. Key employees of Entergy or any of its Subsidiaries
or outside directors of the Board, who, in the opinion of the
Committee, have significant responsibility for the continued
growth, development and financial success of the Companies shall
be eligible to be granted Awards under the Plan. Subject to the
provisions of the Plan, the Committee shall from time to time
select from such eligible persons those to whom Awards shall be
granted and determine the amount of such Award. No employee or
outside director of Entergy or its Subsidiaries shall have any
vested right to be granted an Award under the Plan.
4.2 Dividend Equivalents. In the discretion of the Committee, an
Award made in the form of an Equity Award may provide, subject to
such restrictions, terms and conditions as the Committee may
establish, for (i) the crediting to the account of, or the
current payment to, each Participant who has such an Award of an
amount equal to cash dividends and stock dividends (collectively,
"Dividends") paid by Entergy upon one share of Common Stock for
each share of Common Stock subject to each Equity Award
("Dividend Equivalents"), or (ii) the deemed reinvestment of such
Dividend Equivalents in the form of additional Equity Awards
credited to the Participant's Equity Award Account ("Additional
Equity Awards").
ARTICLE V
STOCK OPTIONS
5.1 General Provisions. The Committee may grant Options to such key
employees and outside directors whom the Committee determines to
be eligible pursuant to the terms of Article IV. Such Options
shall be in such form and upon such terms and conditions as the
Committee shall from time to time determine, subject to the
following:
(a) Option Price. The Option Price of each Option to purchase
Common Stock shall be determined by the Committee, but shall not
be less than the Fair Market Value on the date the Option is
granted.
(b) Term of Options. No Option shall be exercisable prior to six
months, or after ten years, from the date such Option is granted.
(c) Payment of Option Price. The purchase price of the shares as
to which an Option is exercised shall be paid in accordance with
such terms and conditions and by such means as the Committee
shall determine.
(d) Exercise of Options. Options shall be subject to such terms
and conditions, shall be exercisable at such time or times, and
shall be evidenced by such form of written option agreement
between the Participant and the Employer, as the Committee shall
determine; provided, that such determinations are not inconsis
tent with the other provisions of the Plan. The Committee may, in
its discretion, accelerate the ability to exercise any Option in
whole or in part at any time. The Committee may also permit
Participants, either on a selective or aggregate basis,
simultaneously to exercise Options and sell the shares of Common
Stock thereby acquired pursuant to a brokerage or similar
arrangement, approved in advance by the Committee, and use the
proceeds from such sale as payment of the purchase price of such
shares.
(e) Non-Transferability of Options. Options granted under the Plan
shall not be transferable otherwise than by will or by the laws
of descent and distribution, or pursuant to a qualified domestic
relations order as defined by the Internal Revenue Code of 1986,
and Options and rights may be exercised during the lifetime of
the Participant only by the Participant or by the Participant's
guardian or legal representative. Notwithstanding the foregoing
sentence, Options which are not Incentive Stock Options may be
transferred to family members or charities. Any attempted
assignment, transfer, pledge, hypothecation or other disposition
of an option, or levy of attachment or similar process upon the
Option not specifically permitted herein shall be null and void
and without effect.
(f) Maximum Number of Shares. The total number of shares of
Common Stock which any single Participant may be allowed to
purchase pursuant to the exercise of Options granted under this
Plan shall not exceed 25% of the total number of shares of Common
Stock available under this Plan, subject to adjustment in the
same manner as provided in Section 10.1.
5.2 Equity Maintenance. If the Participant exercises an Option during
the term of his employment with Entergy or its Subsidiaries and,
subject to Committee approval, pays the purchase price (or any
portion thereof) of the shares of Common Stock as to which such
Option applies through the surrender of shares of outstanding
Common Stock previously held in the Participant's name, the
Committee may, in its discretion, grant to such Participant an
additional Option to purchase the number of shares of Common
Stock equal to the shares of Common Stock so surrendered by such
Participant. Any such additional Options granted by the Committee
shall be exercisable at the Fair Market Value of Common Stock
determined as of the respective dates such additional Options may
be granted. As stated above, such additional Options may be
granted only in connection with the exercise of Options by the
Participant during the term of his active employment with Entergy
or its Subsidiaries. The grant of such additional Options under
this Section 5.2 shall be made upon such other terms and
conditions as the Committee may from time to time determine
consistent with Section 5.1 above.
5.3 Incentive Stock Options. The Committee may elect to grant
Incentive Stock Options for the purchase of shares of Common
Stock to the key employees whom the Committee determines to be
eligible pursuant to the terms of Article IV. To the extent the
Committee elects to grant Incentive Stock Options under the Plan,
such Incentive Stock Options shall be subject to the limitations
under Section 422 of the Code including, without limitation, the
time limitations on the Award of any such Incentive Stock
Options.
5.4 Limitations on Exercise. The aggregate Fair Market Value
(determined with respect to each Incentive Stock Option as of the
time such Incentive Stock Option is granted) of the Common Stock
with respect to which Incentive Stock Options are exercisable for
the first time by a Participant during any calendar year (under
this Plan or any other plan of Entergy or any of its
Subsidiaries) shall not exceed $100,000. To the extent to which
such Fair Market Value exceeds $100,000, such Option shall be
treated, for federal income tax purposes, as a nonstatutory stock
option.
ARTICLE VI
RESTRICTED SHARE AWARDS
6.1 Grant of Restricted Shares. The Committee may award Restricted
Shares to such key employees and outside directors whom the
Committee determines to be eligible pursuant to the terms of
Article IV. An Award of Restricted Shares may be subject to
restrictions on transfer and forfeitability provisions, all as
the Committee may determine. Such Restricted Shares shall be
awarded based on such other terms and conditions as the Committee
shall from time to time determine subject to the provisions of
the Plan; provided, however, the Participant shall be entitled to
any voting rights relative to such Restricted Shares during the
Restricted Period as defined below.
6.2 Award and Delivery of Restricted Shares. At the time an Award of
Restricted Shares is made, the Committee shall establish a period
of time (the "Restricted Period") applicable to such an Award.
Each Award of Restricted Shares may have a different Restricted
Period. The Committee may, in its sole discretion, at the time an
Award is made, prescribe conditions for the incremental lapse of
restrictions during the Restricted Period and for the lapse or
termination of restrictions upon the satisfaction of other
conditions in addition to or other than the expiration of the
Restricted Period with respect to all or any portion of the
Restricted Shares; provided, however, that any Participant
subject to Section 16 of the Exchange Act shall be prohibited
from selling such shares for a period of six (6) months from the
grant thereof.
6.3 Dividends on Restricted Shares. Any and all cash and stock
dividends paid with respect to the Restricted Shares shall be
subject to any restrictions on transfer, forfeitability
provisions or reinvestment requirements (including, without
limitation, the reinvestment of such dividends in the form of
Equity Awards) as the Committee may, in its discretion,
determine.
6.4 Forfeiture. Upon the forfeiture of any Restricted Shares
(including any additional Restricted Shares which may result from
the reinvestment of cash and stock dividends in accordance with
such rules as the Committee may establish pursuant to Section
6.3), such forfeited shares shall be surrendered. The Participant
shall have the same rights and privileges, and be subject to the
same restrictions, with respect to any additional shares received
pursuant to Section 10.1 due to recapitalization, mergers, or the
like.
6.5 Expiration of Restricted Period. Upon the expiration or
termination of the Restricted Period and the satisfaction of any
other conditions prescribed by the Committee or at such earlier
time as provided for in Section 6.2, the restrictions applicable
to the Restricted Shares shall lapse and a stock certificate for
the number of Restricted Shares with respect to which the
restrictions have lapsed shall be delivered, free of all such
restrictions, except any that may be imposed by law, to the
Participant or the Participant's beneficiary or estate, as the
case may be.
ARTICLE VII
PERFORMANCE SHARE AWARDS
7.1 Award of Performance Shares. The Committee may award Performance
Shares to such key employees and outside directors whom the
Committee determines to be eligible pursuant to the terms of
Article IV. An Award of Performance Shares shall be subject to
the attainment of specified Performance Goals during a
Performance Period, both of which the Committee may determine.
Performance Goals can be based on one or more business criteria
that apply to the Participant, a business unit or Entergy
Corporation as a whole, or any combination thereof.
7.2 Award of Performance Shares to Covered Participants. Awards of
Performance Shares to Covered Participants shall also be governed
by the conditions of this Section 7.2 in addition to the other
requirements set forth in this Plan. Should conditions set forth
under this Section 7.2. conflict with the other provisions of
this Plan, the conditions of this Section 7.2 shall prevail.
(a) The Performance Goals, the objective formula or standards
for computing the number of Performance Shares payable to a
Covered Participant if the Performance Goals are attained and the
Performance Period shall be established by the Committee in
writing prior to the beginning of the Performance Period, or by
such other later date as may be permitted under Section 162(m) of
the Code.
(b) The number of Performance Shares payable to a single
Participant pursuant to this Plan shall not exceed 25% of the
total number of shares of Common Stock available under this Plan,
subject to adjustment in the same manner as provided in Section
10.1.
(c) The Performance Goals may be based upon or may relate to one
or any combination of the following business criteria: EBITDA,
EBIT, net income, earnings per share, operating cash flow, cash
flow, return on equity, sales, budget achievement, productivity,
price of Entergy Corporation stock, market share, total return to
shareholder, return on capital, net cash flow, cash available to
parent, net operating profit after taxes (NOPAT), economic value
added (EVA), expense spending, O&M expense, expense, O&M or
capital/kwh, capital spending, gross margin, net margin, market
capitalization, market value, debt ratio, equity ratio, return on
assets, profit margin, customer growth or customer satisfaction.
The Performance Goals may be stated in terms of absolute levels
or relative to another company or companies or to an index or
indices. The Performance Goals established by the Committee
shall be adjusted to reflect capital changes and shall exclude
unusual or nonrecurring events, including extraordinary items,
changes in accounting principles, discontinued operations,
acquisitions, divestitures and material restructuring charges.
(d) The Performance Goals shall not allow for any discretion by
the Committee as to an increase in any Award, but discretion to
lower an Award is permissible.
(e) The Award and payment of any Award under this Plan to a
Covered Participant with respect to a relevant Performance Period
shall be contingent upon the attainment of the Performance Goals
that are applicable to such Covered Participant. The Committee
shall certify in writing prior to payment any such Award that
such applicable Performance Goals relating to the Award are
satisfied. Approved minutes of the Committee may be used for
this purpose.
(g) All Awards to Covered Participants under this Plan shall be
further subject to such other conditions, restrictions, and
requirements as the Committee may determine to be necessary to
carry out the purpose of this Section 7.2.
7.3 Delivery of Performance Shares. Delivery of Performance Shares
shall not be made until after the end of the Performance Period.
Any Participant subject to Section 16 of the Exchange Act shall
be prohibited from selling such shares for a period of six (6)
months from the delivery thereof.
ARTICLE VIII
EQUITY AWARDS
8.1 Issuance of Equity Awards. An Equity Award may be granted to
such key employees and outside directors as the Committee
determines pursuant to the terms of Article IV. In addition, the
Committee may permit such key employees and outside directors to
purchase Equity Awards under such terms and conditions as the
Committee, in its discretion, may determine. In the case of a
purchase, the Equity Award shall be in the form of units, each of
which represents one share of Common Stock, the purchase price of
which shall not be less than 80% of the closing price of a share
of Common Stock as reported on the New York Stock Exchange
Composite Tape on the date such award is purchased. Key
employees and outside directors who are permitted to purchase
Equity Awards shall make the election to do so at least six (6)
months in advance of the purchase of the Equity Award. Equity
Awards shall be allocated to a Participant's respective Equity
Award Account (as defined in Section 8.3) at such time or times,
in such amounts, subject to such restrictions and in accordance
with such terms and conditions as the Committee, in its
discretion, may determine.
8.2 Funding. In the case of Equity Awards granted under the Plan, no
shares of Common Stock shall be issued at the time the Award is
made, and Entergy, the Employer and Plan, or any one of them,
shall not be required to set aside a fund for the payment of any
such Award.
8.3 Equity Award Accounts. An Equity Award granted to a key employee
shall be credited to an Equity Award Account (the "Equity Award
Account") established and maintained for such Participant. The
Equity Award Account of a Participant shall be the record of
Equity Awards granted to him under the Plan, solely for
accounting purposes and, as provided in Section 8.2 above, shall
not require a segregation of any Entergy or Subsidiary assets.
8.4 Maturity of Equity Awards. All Equity Awards granted to a Partici
pant (including all Additional Equity Awards as defined in
Section 4.2 related to such Equity Awards) shall become fully
matured at time or times or under such circumstances as the
Committee shall from time to time determine.
8.5 Payment of Equity Awards. A Participant who has received an
Equity Award allocated to his Equity Award Account shall be
entitled to receive a distribution from the Employer with respect
to each then mature Equity Award allocated to his Equity Award
Account at such time or times, and in such form, which may
include shares, cash or a combination thereof, as the Committee
shall determine.
8.6 Non-Transferability. Equity Awards granted under the Plan, and
any rights and privileges pertaining thereto, may not be
transferred, assigned, pledged or hypothecated in any manner, by
operation of law or otherwise, other than by will or by the laws
of descent and distribution, and shall not be subject to
execution, attachment or similar process. Any Participant subject
to Section 16 of the Exchange Act shall be prohibited from
selling such shares for a period of six (6) months from the
acquisition thereof.
ARTICLE IX
TERMINATION OR AMENDMENT OF THE PLAN
9.1 Termination and Amendment. The Committee may suspend, terminate,
modify or amend the Plan, provided, if exemption from Section
162(m) deduction limits is to be continued, that any amendment
is made with Board and shareholder approval if shareholder
approval is necessary to comply with any tax, regulatory or
exchange requirement, including for these purposes, the
requirements for the performance-based compensation exception
under Section 162(m) of the Code. If the Plan is terminated, the
terms of the Plan shall, notwithstanding such termination,
continue to apply to Awards granted prior to such termination.
ARTICLE X
GENERAL PROVISIONS
10.1 Adjustments Upon Changes in Capitalization. Notwithstanding
any other provision of the Plan, the Committee may, at any time,
make or provide for such adjustments to the Plan, to the number
and class of shares available thereunder or to any outstanding
Options, Restricted Shares, Performance Shares or Equity Awards
as it shall deem appropriate to prevent dilution or enlargement
of rights, including adjustments in the event of distributions
to holders of Common Stock other than a normal cash dividend,
changes in the outstanding Common Stock by reason of stock
dividends, stock splits, recapitalizations, mergers,
consolidations, combinations or exchanges of shares,
separations, reorganizations, liquidations and the like. Any
such determination by the Committee shall be conclusive.
10.2 Fractional Shares. The Employer shall not be required to
deliver any fractional share of Common Stock but may pay, in
lieu thereof, the Fair Market Value of such fractional share to
the Participant or the Participant's beneficiary or estate, as
the case may be. For purposes of this Section 10.2, the Fair
Market Value shall be determined as of the following dates: (i)
the date on which restrictions lapse for Restricted Shares, (ii)
the date of delivery of Performance Shares (iii) the maturity
date for Equity Awards, or (iv) in any case, such other date as
the Committee may determine.
10.3 Tax Withholdings. Subject to such terms and conditions as
may be established by the Committee, the Participant shall pay
to Entergy any amount necessary to satisfy applicable federal,
state or local tax withholding requirements attributable to an
Award of Options, Restricted Shares, Performance Shares or
Equity Awards under this Plan promptly upon notification of the
amounts due. The Committee may permit such amount to be paid by
the Participants to be withheld from the shares of Common Stock
that otherwise would be distributed to such Participant upon the
exercise of an Option, the lapse of restrictions applicable to
Restricted Shares, the payment of Performance Shares or the
maturity of Equity Awards, as applicable, or a combination of
cash and shares of such Common Stock. Any such withholding on
behalf of a Participant subject to Section 16 of the Exchange
Act shall be made in accordance with the provisions of Rule
16(b)-3(e).
10.4 Legal and Other Requirements. The obligation of Entergy or
its Subsidiaries to sell and deliver Common Stock under the Plan
shall be subject to all applicable laws, regulations, rules and
approvals, including, but not by way of limitation, the
effectiveness of a registration statement under the Securities
Act of 1933 if deemed necessary or appropriate by Entergy.
Certificates for shares of Common Stock issued hereunder may be
legended as the Committee shall deem appropriate.
10.5 Effective Date. The Plan shall become effective as of
January 1, 1998, subject to the approval of Entergy shareholders
at Entergy's 1998 annual meeting of shareholders and receipt of
any necessary governmental approvals including, but not limited
to, any approval of the Securities and Exchange Commission which
may be required under the Public Utility Holding Company Act of
1935.
10.6 Written Agreements. Each Award of Options, Restricted
Shares, Performance Shares or Equity Awards shall be evidenced
by a written agreement which shall contain such restrictions,
terms and conditions as the Committee may require.
Notwithstanding anything to the contrary contained in the Plan,
neither Entergy nor its Subsidiaries bear any obligation to
grant any Awards under the Plan to any Participant hereunder
unless such Participant shall execute all appropriate agreements
with respect to such Awards in such form as the Committee may
determine from time to time.
10.7 Effect on Other Plans. Awards may be granted singly, in
combination or in tandem (except where prohibited by applicable
law) and may be made in combination or tandem with or as
alternatives to, awards or grants under any other employee plan
maintained by Entergy or its Subsidiaries; provided that the
adoption of the Plan shall have no effect on awards made or to
be made pursuant to other stock plans covering the employees of
Entergy, its Subsidiaries or its successors thereto. Awards
under the Plan shall not constitute earnings for purposes of any
pension plan covering employees of Entergy or its Subsidiaries
except as otherwise expressly provided in any such pension plan.
10.8 Right to Terminate Employment. Nothing in the Plan or any
agreement entered into pursuant to the Plan shall confer upon
any key employee the right to continue in the employment of
Entergy or any Subsidiary or affect any right which Entergy or
any Subsidiary may have to terminate the employment of such key
employee.
10.9 Notices. Every direction, revocation or notice authorized
or required by the Plan shall be deemed delivered to Entergy on
the date it is personally delivered to the Secretary of Entergy
at its principal executive offices or three business days after
it is sent by registered or certified mail, postage prepaid,
addressed to the Secretary at such offices, and shall be deemed
delivered to a Participant on the date it is personally
delivered to him or three business days after it is sent by
registered or certificate mail, postage prepaid, addressed to
him at the last address shown for him on the records of Entergy
and its Subsidiaries.
10.10 Applicable Law. All questions pertaining to the validity,
construction and administration of the Plan and rights and
benefits granted hereunder shall be determined in conformity
with the laws of the State of Louisiana, to the extent not
preempted or controlled by the laws of the United States and
regulations thereunder.
10.11 Compliance with Section 16. With respect to persons
subject to Section 16 of the Exchange Act, transactions under
the Plan are intended to comply with all applicable conditions
of Rule 16b-3 or its successors under the Exchange Act or
required by the Securities and Exchange Commission. To the
extent any provisions of the Plan or action by the Committee is
deemed not to comply with an applicable condition of Rule 16b-3,
it shall be deemed null and void, to the extent permitted by law
and deemed advisable by the Committee.
EXHIBIT F
[OPINION OF LAURENCE M. HAMRIC, ESQ.]
March 17, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Gentlemen:
I am familiar with the proposed transactions described
in the Application-Declaration on Form U-1, including any
amendments and exhibits thereto (the "Application-Declaration"),
filed by Entergy Corporation, a Delaware corporation ("Entergy"),
with the Securities and Exchange Commission (the "Commission")
under the Public Utility Holding Company Act of 1935, as amended,
concerning the proposed adoption by Entergy of its 1998 Equity
Ownership Plan (the "Equity Plan") and related transactions.
With respect to any shares of Common Stock, $0.01 par value, of
Entergy ("Shares") which will be acquired on the open market for
use pursuant to the Equity Plan, I have assumed that (a) all
actions required to be taken and other conditions required to be
met by or on behalf of Entergy under Delaware law in connection
with the acquisition of such Shares on the open market will be
taken and satisfied, and (b) such Shares were, or will be, when
originally issued and prior to their acquisition on the open
market, validly issued, fully paid and non-assessable.
I am of opinion that:
(a) Entergy is a corporation duly organized and
validly existing under the laws of the State of Delaware;
(b) In the event that the proposed transactions are
consummated in accordance with the Application-Declaration
and the order(s) of the Commission issued with respect
thereto and in accordance with the terms of the Equity Plan:
(a) any Shares that may be issued or sold
will be validly issued, fully paid and non-assessable,
and the holders thereof will be entitled to the rights
and privileges pertaining thereto as set forth in
Entergy's Certificate of Incorporation; and
(b) the legal rights of the holders of any
securities issued by Entergy or any associate company
thereof will not be violated.
This opinion does not pass on "blue sky" laws which may
apply to the distribution of the Shares.
I am a member of the Louisiana, Texas and Virginia Bars
and do not hold myself out as an expert on the laws of any other
jurisdiction, although I have made a study of the laws of other
jurisdictions insofar as they are involved in the opinions stated
herein.
I hereby consent to the use of this opinion as an
exhibit to the Application-Declaration.
Very truly yours,
/s/ Laurence M. Hamric, Esq.
Laurence M. Hamric, Esq.
EXHIBIT H
FORM OF NOTICE OF PROPOSED TRANSACTIONS
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- ; 70- )
ENTERGY CORPORATION
NOTICE OF PROPOSAL TO ADOPT EQUITY OWNERSHIP PLAN;
ORDER AUTHORIZING PROXY SOLICITATION
Entergy Corporation, 639 Loyola Avenue, New Orleans,
Louisiana 70113 ("Entergy"), a registered holding company, has
filed an application-declaration with the Commission pursuant to
Sections 6(a), 7 and 12(e) of the Public Utility Holding Company
Act of 1935 (the "Act") and Rules 62 and 65 thereunder.
Entergy is proposing to adopt, subject to stockholder
approval at the 1998 Annual Meeting of Stockholders, the 1998
Equity Ownership Plan for Entergy Corporation and Subsidiaries
("Equity Plan"). The Equity Plan will be an amendment and
restatement of Entergy's current Equity Ownership Plan which was
approved by its stockholders in 1991 and authorized by the
Commission pursuant to an Order, dated March 28, 1991 (Release
No. 35-252840), in Commission file number 70-7831. There are no
material differences between the Equity Plan and Entergy's prior
Equity Ownership Plan except that awards granted under the Equity
Plan are intended to qualify as performance based compensation
under Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Code").
Under the Equity Plan, awards may be granted to certain
designated officers and executive personnel ("key employees") of
Entergy and those companies with respect to which Entergy owns,
or directly or indirectly controls, a majority of the combined
voting power (hereinafter, the "Subsidiaries") and members of the
Board of Directors of Entergy who are not otherwise employed by
Entergy or the Subsidiaries. The purpose of the Equity Plan is
to give key employees and outside directors an opportunity to
acquire shares of the Common Stock, $0.01 par value, of Entergy
("Common Stock"), to more closely tie the interests of key
employees and outside directors to those of Entergy's
stockholders, and to reward the effective leadership of Entergy
and the Subsidiaries through the use of equity incentives. Key
employees are those who, in the opinion of the Committee (as
defined herein), have significant responsibility for the
continued growth, development and financial success of Entergy
and the Subsidiaries.
The Equity Plan provides for several mechanisms for
building the equity holdings of key employees and outside
directors. These mechanisms include: (1) stock options
("Options"), which may be either nonstatutory stock options or
incentive stock options as provided in Section 422 of the Code;
(2) shares of Common Stock, which vest over a period of time
("Restricted Shares"); (3) shares of Common Stock which are
awarded upon attainment of specified performance goals
("Performance Shares"); or (4) equity awards in the form of
phantom stock units ("Equity Awards"). The Committee may select
from among these mechanisms when making awards under the Equity
Plan.
A maximum of 12,000,000 shares of Common Stock is
available for awards under the Equity Plan, subject to adjustment
due to stock dividends, stock splits, recapitalizations, mergers,
consolidations or other reorganizations. Shares of Common Stock
awarded under the Equity Plan may be either authorized but
unissued shares or shares acquired in the open market. Shares of
Common Stock covered by awards which are not earned, or which are
forfeited for any reason, and Options which expire unexercised,
will again be available for subsequent awards under the Equity
Plan. To the extent that shares of Common Stock previously held
in a participant's name are surrendered upon the exercise of an
Option or shares relating to an award are used to pay withholding
taxes, such shares shall become available for subsequent awards
under the Equity Plan.
The Equity Plan will be administered by the Personnel
Committee of the Board of Directors of Entergy or such other
committee ("Committee") as the Board may determine is qualified,
to the extent required, to administer the Equity Plan in
accordance with Rule 16b-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The Committee will have
the full power under the Equity Plan to select from among
eligible key employees and outside directors those individuals to
whom awards will be granted; to grant any combination of awards
to any participants and to determine the specific terms and
conditions of each award. The Committee will also have the
exclusive authority to interpret the Equity Plan.
Entergy requests authority from time to time during the
period through December 31, 2008 to grant Options, Restricted
Shares, Performance Shares and Equity Awards pursuant to the
Equity Plan and, in connection therewith, to issue or sell up to
12,000,000 shares of Common Stock to eligible key employees and
outside directors under the Equity Plan
In accordance with the requirements of Rule 16b-3 under
the Exchange Act, the Equity Plan will be submitted to the
stockholders of Entergy for approval at the Annual Meeting of
Stockholders to be held May 15, 1998. Entergy proposes to
solicit proxies from its stockholders for use at the 1998 Annual
Meeting with respect to the approval of the Equity Plan, and has
requested an order pursuant to Section 12(e) of the Act and Rule
62 thereunder for Entergy to engage in such solicitation.
IT IS ORDERED, that the declaration regarding the
proposed solicitation of proxies be, and it hereby is, permitted
to become effective forthwith, pursuant to Rule 62 and subject to
the terms and conditions prescribed in Rule 24 under the Act.
The application-declaration and any amendments thereto
are available for public inspection through the Commission's
Office of Public Reference. Interested persons wishing to
comment or request a hearing should submit their views in writing
by , 1998 to the Secretary, Securities and Exchange
Commission, Washington, D.C. 20549, and serve a copy on the
applicant-declarant at the address specified above. Proof of
service (by affidavit, or in case of any attorney at law, by
certificate) should be filed with the request. Any request for a
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 this matter. After said date, the application-
declaration, as filed or as amended, may be granted and/or
permitted to become effective.
Jonathan G. Katz
Secretary
Exhibit I-1
Notice of Annual Meeting of Stockholders
New Orleans, Louisiana
March 30, 1998
To the Stockholders of ENTERGY CORPORATION:
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
Date: Friday, May 15, 1998
Time: 10:00 a.m. Central Daylight Time
Place: The Woodlands Executive Conference Center
2301 North Millbend Drive
The Woodlands, Texas 77380-1360
MATTERS TO BE VOTED ON
1. Election of Fourteen Directors.
2. Approval of the 1998 Equity Ownership Plan.
3. Approval of the Executive Annual Incentive Plan.
4. Ratification of the appointment of Coopers & Lybrand L.L.P. as
our independent accountants for 1998.
Michael G. Thompson
Secretary
<PAGE>
PROXY STATEMENT
Your vote is very important. For this reason, the Board of Directors
is requesting that you allow your Entergy Corporation Common Stock to
be represented at the Annual Meeting by Edwin Lupberger and Bismark A.
Steinhagen, the persons named as proxies on the enclosed proxy card.
This proxy statement has been prepared for the Board by our
management. The terms "We", "our", "Entergy" and the "Corporation"
each refers to Entergy Corporation. This proxy statement is being
sent to our stockholders on or about March 30, 1998.
GENERAL INFORMATION ABOUT VOTING
WHO CAN VOTE. You are entitled to vote your Common Stock if our
records show that you held your shares as of March 16, 1998. At the
close of business on March 16, 1998, a total of 245,881,656 shares of
Common Stock were outstanding and entitled to vote. Each share of
Common Stock has one vote. The enclosed proxy card shows the number
of shares that you are entitled to vote.
VOTING BY PROXIES. If your Common Stock is held by a broker, bank or
other nominee, you will receive instructions from them which you must
follow in order to have your shares voted in accordance with your
instructions. If you hold your shares in your own name, you may
instruct the proxies how to vote your Common Stock by using the toll
free telephone number listed on the proxy card or by signing, dating
and mailing the proxy card in the postage paid envelope provided to
you. Of course, you may come to the meeting and vote your shares in
person. When you use the telephone system, the system verifies that
you are a stockholder through the use of a Personal Identification
Number assigned to you. The procedure allows you to instruct the
proxies how to vote your shares and to confirm that your instructions
have been properly recorded. Specific directions for using the
telephone voting system are on the proxy card. Whether you mail or
telephone your instructions, the proxies will vote your shares in
accordance with those instructions. If you sign and return a proxy
card without giving specific voting instructions, your shares will be
voted as recommended by our Board of Directors. We are not currently
aware of any matters to be presented other than those described in
this proxy statement. If any other matters not described in the proxy
statement are presented at the meeting, the proxies will use their own
judgment to determine how to vote your shares. If the meeting is
adjourned, your Common Stock may be voted by the proxies on the new
meeting date as well, unless you have revoked your proxy instructions.
HOW YOU MAY REVOKE YOUR PROXY INSTRUCTIONS. To revoke your proxy
instructions, you must either advise the Secretary in writing before
your shares have been voted by the proxies at the meeting, deliver
later proxy instructions, or attend the meeting and vote your shares
in person.
QUORUM REQUIREMENT. The Annual Meeting may not be held unless a
quorum equal to a majority of the outstanding shares entitled to vote
is represented at the meeting. If you have returned valid proxy
instructions or attend the meeting in person, your shares will be
counted for the purpose of determining whether there is a quorum, even
if you wish to abstain from voting on some or all matters introduced
at the meeting. "Broker non-votes" also count for quorum purposes.
If you hold your Common Stock through a broker, bank or other nominee,
it may only vote those shares in accordance with your instructions.
However, if it has not received your instructions within ten days of
the meeting, it may vote on matters which the New York Stock Exchange
determines to be routine. All four proposals before the annual
meeting are routine. If a nominee cannot vote on a matter because it
is not routine or fails to vote on, there is a "broker non-vote".
VOTES NECESSARY FOR ACTION TO BE TAKEN. Fourteen directors will be
elected at the meeting, meaning that the fourteen nominees receiving
the most votes will be elected. In this case, "broker non-votes" will
not be counted as a vote for or against the election of directors.
The three other proposals require an affirmative vote of a majority of
shares entitled to vote. Therefore, abstentions and "broker non-
votes" will have the effect of being a vote cast against those three
proposals.
COST OF THIS PROXY SOLICITATION. We will pay the cost of this proxy
solicitation. In addition to soliciting proxies by mail, we expect
certain of our employees may solicit stockholders for proxies,
personally and by telephone. None of these employees will receive any
additional or special compensation for doing so. We have retained
Morrow & Co. Inc. for a fee of $12,500, plus reasonable out-of-pocket
costs and expenses, to assist in the solicitation of proxies. We
will, upon request, reimburse brokers, banks and other nominees for
their expenses in sending proxy materials to their principals and
obtaining their proxies.
ATTENDING THE ANNUAL MEETING. If you are a holder of record and you
plan to attend the Annual Meeting, please come to the registration
desk before the meeting. If you are a beneficial owner of Common
Stock held by a bank or broker (i. e., in "street name"), you will
need proof of ownership of your Common Stock as of March 16, 1998 to
be admitted to the meeting. A recent brokerage statement or letter
from a bank or broker are examples of proof of ownership. If you want
to vote in person your shares of Common Stock held in street name, you
must obtain a proxy in your name from the registered holder.
STOCKHOLDERS WHO OWN AT LEAST FIVE PERCENT. A stockholder
"beneficially owns" Common Stock by having the power to vote, invest
in, or acquire the common stock within 60 days. Stockholders who
beneficially own at least five percent of the Common Stock are
required to file certain reports with the Securities and Exchange
Commission. Based on these reports, the following beneficial owners
have reported their ownership as of December 31, 1997:
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class
<S> <C> <C>
Barrow, Hanley, Mewhinney & Strauss, Inc.("BHM&S") 13,587,608(1) 5.7%
One McKinney Plaza
3232 McKinney Avenue, 15th Floor
Dallas, Texas 75204-2429
Brinson Partners, Inc. ("BPI") 15,503,600(2) 6.4%
209 South LaSalle
Chicago, Illinois 60604-1295
Franklin Resources, Inc. ("FRI") 19,655,701 (3) 8.10%
777 Mariners Island Blvd.
P.O. Box 7777
San Mateo, CA 94403-7777
</TABLE>
(1) Of the 13,587,608 shares, BHM&S has sole voting power as to
3,356,458 shares, and shared voting power as to 10,231,150 shares.
(2) BPI has shared voting power as to all 15,503,600 shares. BPI is
wholly owned by Brinson Holdings, Inc., which is wholly owned by
SBC Holding (USA), Inc., which is wholly owned by Swiss Bank
Corporation. Each of the above companies reported identical
ownership of the subject 15,503,600 shares in the report filed with
the Securities and Exchange Commission.
(3) FRI may not vote or transfer this Common Stock. These shares are
beneficially owned by one or more investment companies or other
managed accounts which are advised by investment advisory
subsidiaries of FRI. Those subsidiaries, Franklin Advisors, Inc.,
Templeton Global Advisors, Limited, Templeton/Franklin Investment
Services, Inc., Templeton Investment Management (Australia)
Limited, Templeton Investment Counsel, Inc., Franklin Advisory
Services, Inc., and Franklin Mutual Advisors, Inc., may vote and
transfer 8,143,000, 10,155,800, 23,285, 25,000, 7,500, 1,300,000,
and 1,116 shares, respectively.
PROPOSAL 2 - APPROVAL OF THE 1998 EQUITY OWNERSHIP PLAN
The Board of Directors adopted, subject to stockholder approval, the
1998 Equity Ownership Plan of Entergy Corporation and Subsidiaries
("Equity Plan"). This Equity Plan replaces the plan previously
approved by shareholders in 1991. There are no material differences
between the Equity Plan and the prior plan except that the awards
granted under the Equity Plan are intended to qualify as performance
based compensation under Section 162(m) of the Internal Revenue Code
of 1986, as amended. Subject to shareholder approval, the Equity Plan
will be effective as of January 1, 1998.
MAXIMUM NUMBER OF SHARES. A maximum of 12,000,000 shares of Common
Stock will be available for awards. The value of each share of Common
Stock on December 31, 1997 was $29.9375. Common Stock awarded may be
authorized but unissued shares or shares acquired on the open market.
Those stock awards which are forfeited, terminated, or expire, will
again be available for subsequent awards. Any Common Stock
surrendered by a participant to pay withholding taxes shall become
available for subsequent awards.
PARTICIPANTS AND PURPOSE OF THE PLAN. The plan's purpose is to link a
participant's performance to shareholder value and reward effective
leadership with equity incentives. Only those officers and non-
employee directors having significant responsibility for continued
growth, development and financial success shall be eligible to
participate. The Equity Plan will be administered by the Personnel
Committee of the Board which will select the participants and
determine the forms of award. Approximately 150 employees will be
eligible for awards of stock options. For all other forms of awards,
approximately 50 employees will be eligible to participate. The
committee has no plans for any outside directors to participate in the
Equity Plan at this time but does anticipate that all executive
officers and current officers will participate.
FORMS OF AWARD. The Equity Plan provides for several different forms
of award including: (1) stock options to purchase Common Stock, which
may be either non-statutory stock options or incentive stock options
as defined by Federal tax laws, (2) restricted shares, which vest over
time, (3) performance shares pursuant to which Common Stock is awarded
upon reaching specific performance goals, and (4) equity awards in the
form of phantom stock units convertible into Common Stock and/or cash.
STOCK OPTIONS. When granting stock options, the committee will set
the exercise price at not less than fair market value of the Common
Stock on the date the award is granted. Options will not be
exercisable for 6 months and will expire 10 years after the date of
the award. Non-statutory stock options may be transferred to family
members or charities. Incentive stock options must comply with
applicable tax requirements and may not be exercised by a participant
in an amount that exceeds $100,000 in any one year. The total number
of stock options granted to a single participant shall not exceed
480,000 shares.
RESTRICTED SHARES. At the time of an award of restricted shares, the
committee will establish a period during which the restricted shares
will be subject to certain restrictions and provide for the lapse or
termination of restrictions upon the satisfaction of other conditions.
Holders of restricted shares generally have the right to vote and
receive dividends.
PERFORMANCE SHARES. Common Stock may be awarded in the form of
performance shares. The receipt of the Common Stock shall be
contingent upon the participant meeting specified performance goals
during a performance period. Performance goals can be based on one or
more business criteria that apply to either the participant, a
business unit or the Corporation. The performance goals may be stated
in terms of absolute levels or relative to its subsidiaries or to an
index or indices. The number of performance shares payable to a
single participant shall not exceed 480,000 shares.
EQUITY AWARDS. Equity awards in the form of phantom stock units may
be awarded. The value of these units is related to the value of
Common Stock. The committee shall determine the number of phantom
stock units to be awarded and all other terms, restrictions and
conditions of such awards. Each phantom stock unit will be credited
to each participant's account for accounting purposes. Each matured
phantom stock unit may be settled in cash, Common Stock or a
combination of both, as determined by the committee. The committee
may also permit participants to purchase phantom stock units, each of
which represents one share of Common Stock, the purchase price of
which shall not be less than 80% of the fair market value on the date
such award is purchased.
PERFORMANCE-BASED COMPENSATION. Section 162(m) of the Internal
Revenue Code of 1986, as amended, prevents public corporations from
deducting as a business expense that portion of compensation exceeding
$1,000,000 paid to the Chief Executive Officer and any of the other
four most highly compensated executive officers. This deduction limit
does not apply, however, to "performance-based compensation."
Performance-based compensation is compensation paid solely because a
participant met one or more pre-established, objective performance
goals. All awards of stock options and performance shares made to
executive officers will be deemed to be performance-based
compensation.
Stock options are considered performance-based compensation because
the exercise price of such option may not be less than the fair market
value of a share of Common Stock on the date of the award.
Performance shares are considered performance-based compensation
because the goals, the period, and the objective formula for computing
the number of performance shares which are payable when performance
goals are met will be established by the committee in writing prior to
the beginning of the performance period. Once performance goals are
set, the committee may lower an award but may not increase an award.
The performance goals for such executive officers shall be based upon
or may relate to one or any combination of the following business
criteria: Earnings before income taxes, depreciation and amortization
(EBITDA), Earnings before income taxes (EBIT), net income, earnings
per share, operating cash flow, cash flow, return on equity, sales,
budget achievement, productivity, price of Common Stock, market share,
total return to shareholder, return on capital, net cash flow, cash
available to parent, net operating profit after taxes (NOPAT),
economic value added (EVA), expense spending, operation and
maintenance (O&M) expense, expense, O&M or capital/kWh, capital
spending, gross margin, net margin, market capitalization, market
value, debt ratio, equity ratio, return on assets, profit margin,
customer growth or customer satisfaction.
AMENDMENTS. The committee may amend or terminate the Equity Plan
unless shareholder approval is required for an amendment to comply
with any tax or regulatory requirements, or to ensure that the
applicable requirements for deductibility of the performance based
compensation are met.
TAX CONSEQUENCES OF THE PLAN. The grant of a stock option will not
result in taxable income for the optionee or the Corporation at the
time of the grant. Upon the exercise of a non-statutory stock option,
the optionee will recognize ordinary income in the amount by which the
fair market value exceeds the option price. The Corporation will be
entitled to a deduction for the same amount. The optionee will have
no taxable income upon the exercise of an incentive stock option
(except that the alternative minimum tax may apply), and the
Corporation will receive no deduction when an incentive stock option
is exercised. The tax treatment to an optionee of a disposition of
shares acquired by the exercise of an option depends on the length of
time the shares have been held and whether such shares were acquired
by the exercise of an incentive stock option or non-statutory stock
option. Generally, there will be no tax consequence to the
Corporation in connection with the disposition of shares acquired
under a stock option except that the Corporation may be entitled to a
deduction in the case of a disposition of shares acquired upon
exercise of an incentive stock option before the applicable incentive
stock option holding periods have been satisfied.
With respect to other awards granted under the Equity Plan that are
settled either in cash, in Common Stock or other property and are
either transferable or not subject to a substantial risk of
forfeiture, the participant must recognize ordinary income equal to
the cash or fair market value of shares or property received; the
Corporation will be entitled to a deduction for the same amount. For
awards that are settled in Common Stock or property and are restricted
as to the transferability and subject to substantial risk of
forfeiture, the participant must recognize ordinary income equal to
the fair market value of the shares or other property received at the
first time the shares or other property become transferable or not
subject to substantial risk of forfeiture, whichever occurs earlier;
the Corporation will be entitled to a deduction for the same amount.
NEW PLAN BENEFITS. Providing that you approve the Equity Plan, stock
options will be awarded in January 1999 and performance shares will be
awarded in January 1998 based on performance goals set by the
committee for 1998. Under applicable treasury regulations, the
committee may set these performance goals no later than March 31, 1998
for the 1998 performance period as long as the attainment of the
specific goals is still undeterminable. The performance goals will be
based on one of the business criteria discussed above under the
heading "Performance-Based Compensation." The Corporation is unable
to provide meaningful disclosure as to what benefits will be payable
under this plan for 1998, because the performance goals have not been
set and the number of participants and the amount of stock options or
performance shares to be awarded has not been determined. Under the
1991 plan, however, in January 1996 the committee granted performance
shares at the superior target level as follows: Mr. Lupberger, 40,000
shares; Mr. Gallaher, 20,000 shares; Mr. Hintz, 20,000 shares; Mr.
Jackson, 20,000 shares; Mr. Maulden, 25,000 shares; Mr. McInvale,
20,000 shares; all executive officers as a group, 163,000 shares; and
all non-executive officers and employees as a group, 256,750 shares.
These awards are subject to a three year performance period. It is
impossible to determine, at this time, whether any or all awards will
be earned. In January 1998, under the 1991 plan, the committee
granted 71,250 options to all executive officers as a group and 50,000
options to all non-executive officers and employees as a group with an
exercise price of $26.50. Options granted to the named executive
officers are reported on the Option Grant Table on page 17. These
options are currently exercisable.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
1998 EQUITY OWNERSHIP PLAN.
Exhibit I-2
ENTERGY CORPORATION
Proxy Solicited by the Board of Directors for the
Annual Meeting of Stockholders--May 15, 1998
I hereby appoint Messrs. Edwin Lupberger and Bismark A.
Steinhagen jointly and severally, as Proxies, each with the power to
appoint his substitute, and hereby authorizes them to represent and
to vote, as designated on the reverse side, all shares of Common
Stock of Entergy Corporation held of record by me on March 16, 1998,
at the Annual Meeting of Stockholders to be held at The Woodlands
Executive Conference Center, 2301 North Millbend Drive, The
Woodlands, Texas, on Friday, May 15, 1998, at 10:00 a.m., Central
Daylight Time, and any adjournment or adjournments thereof, with all
powers that I would possess if personally present.
In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting, and any
adjournment or adjournments thereof.
Receipt of the notice of meeting, the proxy statement and the
Annual Report of Entergy Corporation for 1997 is acknowledged.
(Continued, and to be marked, dated and signed, on the other side)
- ---------------------------------------------------------------------
FOLD AND DETACH HERE
YOUR VOTE IS IMPORTANT!
You can vote in one of two ways:
Call toll free 1-800-840-1208 on a Touch Tone telephone and
follow the instructions on the reverse side. There is NO CHARGE to
you for this call.
Mark, sign and date your proxy card and return it promptly in
the enclosed envelope.
PLEASE VOTE
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1,
2, 3 AND 4. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1, 2, 3 AND 4.
FOR WITHHOLD FOR ALL
EXCEPT
1. Election of Directors
01 W. F. Blount 02 J. A. Coopers, Jr. 03 G. W. Davis
04 N. C. Francis 05 R. v.d. Luft 06 E. Lupberger
07 K. R. McKee 08 P. W. Murrill 09 J. R. Nichols
10 E. H. Owen 11 J. N. Palmer, Sr. 12 R. D. Pugh
13 W. C. Smith 14 B. A. Steinhagen
_____________________________________
Except Nominee(s) written above
FOR AGAINST ABSTAIN
2. Approval of the 1998 Equity
Ownership Plan.
3. Approval of the Executive Annual
Incentive Plan.
4. Ratification of the appointment
of Coopers & Lybrand L.L.P.
as independent accountants for
1998.
***IF YOU WISH TO VOTE BY TELEPHONE, PLEASE READ THE INSTRUCTIONS
BELOW***
Signature______________ Signature______________ Date______________
If acting as Attorney, Executor, Trustee or in other representative
capacity, please sign name and title
______________________________________________________________________
FOLD AND DETACH HERE
VOTE BY TELEPHONE
QUICK EASY IMMEDIATE
Your telephone vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed and returned your proxy
card.
- - You will be asked to enter a Control Number which is located in
the box in the lower right hand corner of this form.
OPTION #1: To vote as the Board of Directors recommends on ALL
proposals: Press 1.
When asked, please confirm your vote by Pressing 1.
OPTION #2: If you choose to vote on each proposal separately, press
0. You will hear these instructions.
Proposal 1: To vote FOR ALL nominees, press 1; to WITHHOLD FOR
ALL nominees, press 9.
To withhold FOR AN INDIVIDUAL nominee, press 0 and listen to
the instructions.
Proposal 2: To vote FOR, press 1; AGAINST, press 9; ABSTAIN,
press 0.
The Instructions are the same for all remaining proposals.
When asked, please confirm your vote by Pressing 1.
PLEASE DO NOT RETURN THE ABOVE PROXY CARD IF VOTED BY PHONE.
Call Toll Free On a Touch Tone Control Number
Telephone
1-800-840-1208 ANYTIME --- --- --- --
There is NO CHARGE to you for
this call.
