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
___________________________________
Mississippi Power & Light Company
308 East Pearl Street
Jackson, MS 39201
(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)
___________________________________
Donald E. Meiners William J. Regan, Jr.
President Vice President and
Mississippi Power & Light Treasurer
Company Entergy Services, Inc.
308 East Pearl Street 639 Loyola Avenue
Jackson, MS 39201 New Orleans, LA 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. Thomas J. Igoe, Jr., Esq.
Denise C. Redmann, Esq. Kevin Stacey, Esq.
Entergy Services, Inc. Reid & Priest LLP
639 Loyola Avenue 40 West 57th Street
New Orleans, LA 70113 New York, NY 10019
<PAGE>
Item 1. Description of Proposed Transactions
Section A. Overview
Mississippi Power & Light Company, a Mississippi corporation
("Company"), and a subsidiary of Entergy Corporation ("Entergy"),
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, 2000, (1) to
issue and sell one or more series of the Company's general and
refunding mortgage bonds ("Bonds") and/or one or more series of
the Company's debentures ("Debentures") in a combined aggregate
principal amount of Bonds and Debentures not to exceed $530
million, and/or (2) to issue and sell (a) through one or more
special purpose subsidiaries of the Company, one or more series of
preferred securities of such subsidiary having a stated per share
liquidation preference ("Entity Interests") and/or (b) one or more
new series of the Company's Preferred Stock ("Preferred"), in a
combined aggregate amount of Entity Interests and Preferred not to
exceed $75 million (the issuance of the Entity Interests to
include the issuance of one or more series of the Company's junior
subordinated debentures to said special purpose subsidiaries, each
series of junior subordinated debentures in an amount not to
exceed the amount of the respective series of Entity Interests
plus an equity contribution and in addition to, and not to be
included in the amount of Debentures requested in subsection (1)
above), and/or (3) to enter into arrangements for the issuance and
sale of one or more series of tax-exempt bonds ("Tax-Exempt
Bonds") in an aggregate principal amount not to exceed $35 million
for the financing of certain pollution control facilities,
including but not limited to sewage and/or solid waste disposal
facilities that have not heretofore been the subject of such
financing or for the refinancing of outstanding tax-exempt bonds
issued for that purpose, including the possible issuance and
pledge of one or more new series of Bonds ("Collateral Bonds") as
collateral security for such Tax-Exempt Bonds in an aggregate
principal amount not to exceed $38.5 million which amount of said
Collateral Bonds is not included in the $530 million combined
aggregate principal amount of Bonds and Debentures referred to in
subsection (1) above (the financings contemplated in (1) through
(3) above being hereinafter collectively referred to as "New
Financing Plan"), and/or (4) to acquire, from time to time by
tender offer, open market or negotiated purchases, all or a
portion of one or more series of the Company's outstanding First
Mortgage Bonds, General and Refunding Mortgage Bonds, Preferred,
and/or outstanding Tax-Exempt Bonds previously issued for the
benefit of the Company (collectively, "New Acquisition Program").
Each of these proposed transactions is discussed in detail below.
Section B. Issuance and Sale of the Bonds
The new series of Bonds will be issued under the
Company's Mortgage and Deed of Trust, dated as of February 1,
1988, to Bank of Montreal Trust Company and Mark F. McLaughlin
(successor to Z. George Klodnicki), as Trustees, as heretofore
supplemented by ten supplemental indentures (each, a "Supplemental
Indenture" and collectively, "Supplemental Indentures") and as
proposed to be further supplemented by additional Supplemental
Indenture(s), each relating to one or more new series of Bonds
(the "Mortgage"). The Bonds would be issued on the basis of
unfunded net property additions and/or previously retired bonds,
as permitted and authorized by the Mortgage.
Each new series of Bonds will be sold at such price,
bear interest at such rate or rates, and mature on such date or
dates as shall be determined at the time of sale or when the
agreement to sell is entered into, as the case may be. No series
of Bonds will be issued at rates in excess of the lower of 15% per
annum or those rates generally obtainable at the time of pricing
for sales of mortgage bonds having the same or reasonably similar
maturities, issued by companies of the same or reasonably
comparable credit quality and having reasonably similar terms,
conditions and features. The price, exclusive of accrued
interest, to be paid to the Company for each new series of Bonds
to be sold at competitive bidding will be within a range (to be
specified by the Company to prospective purchasers) of 95% to 105%
of the principal amount thereof. Each series of Bonds will
mature not later than forty years from the day of issuance.
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, when set, would be sufficient to remarket the Bonds of such
series at their principal amount ("Remarketed Bonds").
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 ("LIBOR") or the yield to maturity of
specified United States Treasury securities ("Treasury Rate"), 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.
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 similar
maturities, issued by companies of comparable credit quality and
having reasonably comparable terms, and would not exceed a
specified maximum rate greater than 15% per annum.
The Supplemental Indenture to the Mortgage for any
series of Remarketed Bonds would provide that holders thereof
would have the right to tender or be required to tender their
Bonds 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 applicable 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 the same
during a specified period of time preceding such purchase date to
the Tender Agent, if one shall have been appointed, or to the
Remarketing Agent appointed to reoffer such tendered Bonds for
sale.
The Company would be obligated to pay amounts equal to
the amounts to be paid to 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.
One or more new 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 except from credits to retained earnings, plus $250
million, plus such additional amounts as shall be approved by the
Securities and Exchange Commission (the "Commission"). However,
the Company may determine not to include any provisions
restricting its ability to pay common stock dividends. To the
extent that the foregoing deviates from the Commission's Statement
of Policy Regarding First Mortgage Bonds (Holding Company Act
Release No. 13105, February 16, 1956, as modified by Holding
Company Act Release No. 16369, May 8, 1969), the Company hereby
requests authorization by the Commission of any such deviation.
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.
Section C. Issuance and Sale of the Debentures
The Debentures will be issued under one or more
Debenture Indentures or Subordinated Debenture Indentures, to be
substantially in the forms attached as Exhibits A-11 and A-13,
respectively (each, a "Debenture Indenture"), as any of the same
may be supplemented from time to time.
Each series of Debentures will be sold at such price,
will bear interest at such rate(s) and will mature on such date(s)
as shall have been be determined at the time of sale. Debentures
will not be sold if the fixed interest rate or initial adjustable
interest rate thereon would exceed the lower of 15% or rates
generally obtainable at the time of pricing for sales of
debentures having the same or reasonably equivalent maturity,
issued by companies of comparable credit quality and having
reasonably similar terms, conditions and features. As to series
of Debentures having an adjustable interest rate, the initial
interest rate for such series will be negotiated by the Company
and the purchasers of such series and will 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 will be that rate which, when set, would be
sufficient to remarket the Debentures of such series at their
principal amount ("Remarketed Debentures").
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 LIBOR or the
Treasury Rate, or may be established by reference to orders
received in an auction procedure, and will not exceed a specified
maximum rate, which shall not exceed 15% per annum. Such interest
rate may be adjusted at established intervals or may be adjusted
simultaneously with changes in the benchmark rate.
The interest rate for Remarketed Debentures after the
initial interest rate period will not exceed rates generally
obtainable at the time of remarketing of debentures having the
same or reasonably similar maturity, issued by companies of
comparable credit quality and having the same or reasonably
comparable terms and will not exceed a specified maximum rate not
to exceed 15% per annum.
The terms of Remarketed Debentures would provide that
holders thereof have the right to tender or are required to tender
their Debentures and have them purchased at a price equal to the
principal amount thereof plus accrued and unpaid interest thereon,
on specified dates. A Tender Agent may be appointed to facilitate
the tender of any Debentures by holders. Any holder of Remarketed
Debentures wishing to have them purchased may be required to
deliver the same 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 the same for sale.
The Company would be obligated to pay amounts equal to
the amounts to be paid to the Remarketing Agent or the Tender
Agent for the purchase of Remarketed Debentures so tendered, which
amounts would 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 Debentures 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 the same
at a price equal to the principal amount thereof.
The price, exclusive of accrued interest, to be paid to
the Company for each such series of Debentures sold at competitive
bidding will be within a range (to be specified by the Company to
prospective purchasers) of 95% to 105% of the principal amount of
such series. Each series of Debentures will mature not later than
fifty years from the day of issuance.
One or more series of Debentures may include provisions
for redemption prior to maturity at various percentages of the
principal amount thereof, restrictions on optional redemption for
a given number of years and/or provisions for the mandatory
retirement of some or all of such series prior to maturity.
Debentures issued under a Subordinated Debenture
Indenture would be expressly subordinated to Senior Indebtedness,
as defined therein or pursuant thereto, and may also provide that
payments of interest on such Subordinated Debentures may be
deferred, without creating a default with respect thereto, for
specified periods, so long as no dividends are being paid on, or
certain actions are being taken with respect to the retirement of,
the common or preferred stock of the Company during such period of
deferral.
Reference is made to Exhibits A-11, A-12, A-13, A-14 and
B-8 hereto for further information with respect to the terms of
each series of Debentures.
Section D. Issuance and Sale of Entity Interests
The Company proposes to organize either a special
purpose limited partnership or a statutory business trust (the
"Issuing Entity") for the sole purpose of issuing the Entity
Interests. In the case of a limited partnership, the Company
would either (a) act as the general partner of the Issuing Entity
or (b) organize a special purpose, wholly-owned corporation 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 would be
conducted by one or more trustees (individually and collectively,
the "Trustee"). Prior to a default, the Company will, as a result
of its ownership of all voting interests in the Issuing Entity, be
entitled to appoint, remove or replace the Trustee.
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 voting interests (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.
The holders of the Entity Interests will be either (a)
the limited partners (in the case of a limited partnership) or (b)
the holders of preferred interests (in the case of a business
trust) of the Issuing Entity.
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 the Company, to purchase the
Entity Subordinated Debentures. The Entity Subordinated
Debentures will be issued by the Company pursuant to a
Subordinated Debenture Indenture (the "Entity Subordinated
Debenture Indenture"). Reference is made to Exhibits A-15 and A16
respectfully for forms of the Entity Subordinated Debenture
Indenture and the Entity Subordinated Debenture.
Each series of Entity Subordinated Debentures will
mature at such time, not more than fifty 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, and optional
additional terms which together do not exceed fifty years from the
date of issuance. For example, the Entity Subordinated Debentures
may have an initial term of thirty years with the Company having
the right to extend the maturity for up to an additional nineteen
years. Prior to maturity, the Company will pay interest only on
the Entity Subordinated Debentures, at either a fixed or
adjustable rate as set forth in the Entity Subordinated Debenture
Indenture. The distribution rates, payment dates, redemption,
maturity, and other terms applicable to each series of Entity
Interests will be substantially identical to the interest rates,
payment dates, redemption, maturity, and other terms applicable to
the Entity Subordinated Debentures relating thereto, and will be
determined by the Company at the time of issuance. The interest
paid by the Company on the Entity Subordinated Debentures will
constitute the only source of income for 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.
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
certain 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. A form of the
Guaranty will be filed by Rule 24 Certificate as Exhibit A-19,
unless the Company has decided not to provide the guaranties
described in this paragraph.
The Company's Entity Subordinated Debentures issued
under the Subordinated Debenture Indenture and the Guaranty (if
issued) will 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 for specified periods, without creating a default with
respect thereto, so long as no dividends are being paid on, or
certain actions are being taken with respect to the retirement of,
the common or preferred stock of the Company during such period of
deferral.
Distributions on the Entity Interests will be paid
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 sufficient for
such purposes. The availability of funds will depend entirely
upon 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 24 above. If distributions on the
Entity Interests (including all previously deferred distributions,
if any) are deferred for up to sixty consecutive months, then the
holders of Entity Interests may 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 the right to accelerate the maturity of the Entity
Subordinated Debentures.
It is anticipated that interest payments by the Company
on the Entity Subordinated Debentures will be deductible by it for
federal and state income tax purposes and that the Issuing Entity
will be treated as either a partnership or a trust, as the case
may be, for federal income tax purposes. Consequently, the
holders of Entity Interests will be deemed to have received
interest income rather than dividends, and will not be entitled to
any "dividends received deduction" under the Internal Revenue
Code.
One or more series of Entity Interests and 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 in
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 upon, among other factors, market conditions at
the time of issuance but will be not later than five 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. 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 are (a) the Issuing Entity becoming subject to
federal income tax with respect to interest received on the Entity
Subordinated Debentures or otherwise not being treated as a
partnership or a trust, as the case may be, for federal income tax
purposes, (b) interest payments by the Company on the Entity
Subordinated Debentures being determined not to be deductible for
federal income tax purposes, or (c) the Issuing Entity becoming
subject to more than a minimal amount of other taxes, duties or
other governmental impositions. The Entity Subordinated Debenture
Indenture and the Entity Agreement (referred to in paragraph 33
below) 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 the Issuing Entity becoming subject
to regulation as an "investment company" under the Investment
Company Act of 1940, as amended.
The Company may also reserve the right upon the
occurrence of a Tax Event or a Regulatory Event, to exchange the
Entity Subordinated Debentures for the Entity Interests or
otherwise to distribute the Entity Subordinated Debentures to the
holders of Entity Interests, whereupon the Entity Interests would
be canceled.
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 be, for federal
income tax purposes, the Issuing Entity is required under
applicable tax laws to withhold or deduct from payments on the
Entity Interests amounts that otherwise would not 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 increase or "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.
In the event of any voluntary or involuntary
liquidation, dissolution or winding up of 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 Company, an amount equal
to the stated liquidation preference of the Entity Interests plus
any accrued and unpaid distributions.
Under either the Amended and Restated Agreement of
Limited Partnership or Declaration of Trust, as the case may be,
that shall 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 solely to (i) the
issuance and sale of Entity Interests, (ii) 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, (iii) the receipt of interest on the
Entity Subordinated Debentures, and (iv) the payment of
distributions on the Entity Interests. Reference is made to
Exhibit A-17 for a form of the Entity Agreement.
The Entity Agreement will further state that either the
general partner (in the case of a limited partnership) or the
Trustee (in the case of a business trust), shall manage and
control the Issuing Entity's business and affairs and 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 voting interests (in the case of a
business trust) shall not be transferable 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.
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), the Entity
Agreement will not include any interest or distribution coverage
or capitalization ratio restrictions on the ability to issue and
sell additional Entity Interests. Such restrictions would not be
necessary, and the capital structure of the Issuing Entity would
not be relevant, because the interest payments of the Company on
the Entity Subordinated Debentures will be sufficient to service
fully the distributions on Entity Interests. For this reason,
financial statements for the Issuing Entity are not included with
this Application-Declaration.
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 shall have been
determined at the time of sale. No series of Entity Interests or
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% per annum or market rates generally obtainable at the
time of pricing for sales of limited partnership or business trust
interests having a reasonably equivalent maturity, issued by
subsidiaries of companies of reasonably comparable credit quality
and having reasonably similar terms, conditions and features. The
initial distribution rate for Entity Interests of such series
having an adjustable distribution rate will be determined in
negotiations between the Company and the purchasers of such series
and be based on then current market rates for comparable
subsidiary securities. Thereafter, the distribution 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, at the time of
remarketing, would be sufficient to remarket the Entity Interests
of such series at their principal amount ("Remarketed Entity
Interests").
The distribution rate for Floating Rate Entity Interests
after the initial distribution rate period will be set as a
percentage of, or as a specified spread from, a benchmark rate,
such as LIBOR or the Treasury Rate, or may be established by
reference to orders received in an auction procedure, and will not
exceed a specified maximum rate that will be no greater than 15%
per annum. Such distribution rate may be adjusted at established
intervals or may be adjusted simultaneously with changes in the
benchmark rate.
The distribution rate for Remarketed Entity Interests
after the initial distribution rate period will not be greater
than rates generally obtainable at the time of remarketing of
limited partnership or business trust interests, as the case may
be, having the same or reasonably equivalent maturity, issued by
subsidiaries of companies of reasonably comparable credit quality
and having reasonably comparable terms, and will not exceed a
specified maximum rate that will be no greater than 15% per annum.
The Entity Agreement would provide that holders of
Entity Interests would have the right to tender, or could be
required to tender, their Entity Interests and have them purchased
at a price equal to the principal amount thereof plus 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 Entity
Interests by holders. Any holder of Entity Interests wishing to
have the same 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.
The Company would be obligated to pay amounts equal to
the amounts to be paid to the Remarketing Agent or the Tender
Agent pursuant to the Entity Agreement for the purchase of Entity
Interests so tendered (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 liquidation amount of
such Entity Interests.
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) from
95% to 105% of the liquidation amount of such series of Entity
Interests.
Section E. Issuance and Sale of Preferred.
The Company expects that each series of the Preferred
will consist of shares of the Company's Preferred Stock,
Cumulative, $100 Par Value ("$100 Preferred"), as currently
authorized by the Company's Restated Articles of Incorporation, as
amended ("Articles"). In accordance with the Articles, the Company
had authorized and unissued at September 30, 1995, 1,675,000
shares of $100 Preferred.
The price, exclusive of accumulated dividends, to be
paid to the Company for each series of Preferred will be
determined at the time of sale and will not be less than par 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 be not less than the par value nor more than 102.75% thereof
per share plus accumulated dividends, if any. No series of
Preferred would be sold if the dividend rate thereon would exceed
that generally obtainable at the time of pricing for sales of
preferred stock of the same or reasonably similar par or stated
value, issued by companies of the same or reasonably comparable
credit quality and having similar terms, conditions and features.
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
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 forty
years after the date of original issuance thereof.
Depending upon market conditions at the time of the
offering of a given series of the Preferred, if the Company
determines that preferred stock having a public offering price of
less than $100 per share is likely to have a materially better
market reception than shares of $100 Preferred, the Company may
issue and sell such series of Preferred to underwriters for
deposit with a bank or trust company ("Depositary"). The
underwriters would then receive from the Depositary, and deliver
to the purchasers in a subsequent public offering, shares of
depositary preferred stock ("Depositary Preferred"), each
representing a stated fraction of a share of the new series of
Preferred. Depositary Preferred would be evidenced by depositary
receipts entitling each owner thereof proportionally to all the
rights and preferences of the series of Preferred (including
dividends, redemption and voting). A holder of Depositary
Preferred would be entitled to surrender Depositary Preferred to
the Depositary and receive the number of whole shares of Preferred
represented thereby; and a holder of Preferred would be entitled
to surrender shares of Preferred to the Depositary and receive a
proportional amount of Depositary Preferred.
For further information as to the terms of the
Preferred, including possible depositary arrangements, reference
is made to Exhibits A-6 through A-10.
As an alternative to the use of Depositary Preferred to
meet market demand, the Company may determine to amend the
Articles to establish a new class of preferred stock having no par
value or a nominal par value. It is expected that such class
would rank pari passu with the $100 Preferred and would be
identical with the $100 Preferred, except as to par value,
variations among series of the new class and series of the $100
Preferred, and voting entitlement per share in cases where the two
classes are required to vote together or with the common stock as
a voting group. The new class of preferred stock would permit the
board of directors greater flexibility in setting the terms of new
series to respond to market conditions by permitting the board to
set the stated value (usually tied to the amount per share payable
on involuntary liquidation) of the shares of each series of such
class. In the event the Company so amends the Articles, one or
more series of the Preferred may consist of shares of the new
class, and the stated value would be substituted for the par value
and any redemption and sinking fund provisions. In conjunction
with this amendment, the Company may also determine to amend the
Articles in other respects, including, but not limited to, an
amendment to increase the number of authorized shares of $100
Preferred and/or amendments to clarify certain provisions with
respect to issuance of Preferred with market based dividend rates
and varying dividend payment periods. Approval of the holders of
outstanding $100 Preferred and of Entergy, as sole holder of the
Company's common stock, would be required in order to effect such
an amendment to the Articles. In the event the Company determines
to effect such an amendment, information on the proposed terms of
the new class and on solicitation of proxies and consents in
connection with shareholder approval of the amendment would be
provided by amendment. Reference is made to Exhibits A-7, A-8, H-
2 and H-3 hereto.
Section F. General Matters Relating to Bonds, Debentures, Entity
Interests and Preferred
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.
49. 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. Sale(s) of Bonds, Debentures, Entity Interests and
Preferred are separate transactions not contingent upon one
another.
50. 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 conduct of its business as an electric
utility, the repayment of outstanding securities when due and/or
the possible redemption, acquisition, or refunding of certain
outstanding securities prior to their stated maturity or due date.
The Company's request for authorization for such sales is in part
to provide the flexibility to permit a quick response to changing
market conditions if it becomes beneficial for the Company to
refinance, refund, or otherwise acquire outstanding high cost
securities. (See "Acquisition Program" below.)
51. The Mortgage and Articles include earnings coverage
tests for the issuance of additional Bonds and Preferred,
respectively. Reference is made to Exhibits I-1 and I-2 hereto
for information on the amounts of such securities currently
issuable based on such tests. The Company will not issue any
Bonds or Preferred unless all applicable relevant earnings
coverage tests are satisfied.
Section G. Issuance and Sale of Tax-Exempt Bonds and Related
Transactions
52. The Company also may seek to enter into arrangements for
the issuance of Tax-Exempt Bonds, and the Company proposes from
time to time through December 31, 2000 to enter into one or more
leases, subleases, installment sale agreements, refunding
agreements or other agreements and/or supplements and/or
amendments thereto (each and all of the foregoing being referred
to herein as the "Facilities Agreement") with one or more issuing
governmental authorities (each an "Issuer") that will contemplate
the issuance and sale by the Issuer(s) of one or more series of
Tax-Exempt Bonds in an aggregate principal amount not to exceed
$35 million pursuant to one or more trust indentures and/or
supplements thereto (individually and collectively, the
"Indenture") between the Issuer and one or more trustees
(individually and collectively, the "Trustee").
53. The proceeds of the sale of Tax-Exempt Bonds, net of any
underwriters' discounts or other expenses payable from proceeds,
will be applied to finance certain pollution control facilities,
including but not limited to sewage and/or solid waste disposal
facilities (referred to herein individually and collectively as
the "Facilities"), that have not heretofore been the subject of
such financing, or to refinance outstanding taxexempt bonds issued
for that purpose. Pursuant to the terms of each Facilities
Agreement, the Company will agree to purchase, acquire, construct
and install the Facilities unless the Facilities are already in
operation. The Issuer will agree to pay to the Company an amount
equal to the lesser of (a) the total amount of the proceeds from
the sale of the Tax-Exempt Bonds or (b) the total cost of the
Facilities, in the case of Facilities under construction.
Pursuant to the provisions of the Facilities
<PAGE>
Agreement, the Company will be obligated to make payments
sufficient to provide for payment by the Issuer of the principal
or redemption price of, premium (if any) and interest on, and
other amounts owing with respect to the Tax-Exempt Bonds, together
with related expenses. Such payments will be paid by the Company
directly to the Trustee under to the Indenture.
Under the Facilities Agreement, the Company may also be obligated
to pay (i) the fees and charges of the Trustee and any registrar
or paying agent under the Indenture, and the Remarketing Agent and
the Tender Agent, as hereinafter referred to, (ii) all expenses
incurred by the Issuer in connection with its rights and
obligations under the Facilities Agreement, (iii) all expenses
necessarily incurred by the Issuer or the Trustee under the
Indenture in connection with the transfer or exchange of TaxExempt
Bonds, and (iv) certain other fees and expenses.
54. The Indenture may provide that, upon the occurrence of
certain events relating to the operation of the Facilities, a
series of Tax-Exempt Bonds will be redeemable by the Issuer at the
direction of the Company. Any series of Tax-Exempt Bonds may be
made subject to a mandatory cash sinking fund under which certain
principal amounts and/or specific portions of Tax-Exempt Bonds of
such series are to be retired at stated times, and may be subject
to mandatory redemption in certain other cases. The payments by
the Company under the Facilities Agreement in such circumstances
shall be sufficient (together with any other moneys held by the
Trustee under the Indenture and available therefor) to pay the
principal of all Tax-Exempt Bonds to be redeemed or retired, the
premium (if any) and interest accrued or to accrue to the
redemption date thereon.
55. Each series of Tax-Exempt Bonds will mature not earlier
than one year nor later than forty years from the date of
issuance. The Tax-Exempt Bonds may be subject to optional
redemption by the Issuer, at the direction of the Company, in
whole or in part at the redemption prices (expressed as
percentages of the principal amount thereof) plus accrued interest
to the redemption date, and at the times, as are set forth in the
Indenture.
56. The Facilities Agreement and the Indenture may provide
for a fixed and/or for an adjustable interest rate for one or more
series of Tax-Exempt Bonds. No series of Tax-Exempt Bonds would
be sold if the fixed interest rate or initial adjustable interest
rate thereon would exceed market rates generally obtainable at the
time of pricing for sales of tax-exempt bonds having a reasonably
similar maturity, issued for the benefit of companies of a
reasonably comparable credit quality and having reasonably similar
terms, conditions and features. The initial interest rate for Tax-
Exempt Bonds of a series having an adjustable interest rate would
be determined in discussions between the Company and the
purchasers of such series and be based on the current tax-exempt
market rates for comparable bonds having a maturity comparable to
the length of the initial Rate Period (hereinafter referred to).
For each Rate Period thereafter, the interest rate on such Tax-
Exempt Bonds would be a rate which, when set, would be sufficient
to remarket the TaxExempt Bonds of such series at a price equal to
their principal amount. Such subsequent interest rates would not
exceed the lower of 13% per annum or rates generally obtainable at
the time of remarketing of tax-exempt bonds having the same or
reasonably similar maturities, issued for the benefit of companies
of reasonably comparable credit quality and having the same or
reasonably similar terms.
57. The term "Rate Period", as used herein, refers to a
period during which the interest rate on Tax-Exempt Bonds of a
particular series, while bearing an adjustable rate (or method of
determination of such interest rate), is fixed. The initial Rate
Period would commence on the date when interest begins to accrue
on the Tax-Exempt Bonds of such series. The length of each Rate
Period would be not less than one day nor more than thirty years.
58. The Facilities Agreement and the Indenture will provide
that the holders of Tax-Exempt Bonds will have the right to tender
or be required to tender their Tax-Exempt Bonds and have them
purchased at a price equal to the principal amount thereof, plus
any accrued and unpaid interest thereon, on dates specified in, or
established in accordance with, the Indenture. A Tender Agent may
be appointed to facilitate the tender of Tax-Exempt Bonds by
holders. Any holders of Tax-Exempt Bonds wishing to have such Tax-
Exempt Bonds purchased may be required to deliver the same 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 TaxExempt Bonds for sale.
59. Under the Facilities Agreement, the Company will be
obligated to pay amounts equal to the amounts to be paid by the
Remarketing Agent or the Tender Agent for the purchase of Tax-
Exempt Bonds so tendered, such amounts to be paid by the Company
on the dates when 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 Facilities
Agreement will be reduced by the amount of any other moneys
available therefor, including the proceeds of the sale of tendered
Tax-Exempt Bonds by the Remarketing Agent.
60. Upon the delivery of Tax-Exempt Bonds by holders to the
Remarketing Agent or the Tender Agent for purchase, the
Remarketing Agent will be obligated to use its best efforts to
sell such Tax-Exempt Bonds at a price equal to the principal
amount thereof.
61. 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 one or more irrevocable
letter(s) of credit for an aggregate amount up to $38.5 million
from one or more banks (individually and collectively the "Bank")
in favor of the Trustee. In that 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 would not exceed fifteen
years, would be secured by, and payable from funds (if any) drawn
under, the letter of credit. To induce the Bank to issue such
letter of credit, the Company would enter into one or more
reimbursement agreements ("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 (not to exceed sixty months) after the date such
funds were drawn and with interest thereon at a rate that would
not exceed rates generally obtainable at the time of entering into
the Reimbursement Agreement by companies of reasonably comparable
credit quality on letters of credit having the same or reasonably
comparable terms and, in any event, not in excess of the Bank's
prime commercial lending rate plus 2%. The terms of the
Reimbursement Agreement would correspond to the terms in the
letter of credit.
It is anticipated that the Reimbursement Agreement would
require the payment in advance by the Company to the Bank of
letter of credit fees not to exceed $100,000 and annual fees not
to exceed 1-1/4% of the face amount of the letter of credit. Any
such letter of credit would expire or be terminable 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 could 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
rights 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
(having substantially the same terms as the original letter of
credit) from the Bank or another bank. Such extended or
replacement letters of credit would expire not later than the
final maturity date of the related Tax-Exempt Bonds.
63. In order to secure the Company's obligations under the
Facilities Agreement and/or, in the event the Company enters into
a Reimbursement Agreement, under the Reimbursement Agreement, the
Company may grant to the Issuer, the Trustee and/or the Bank, a
lien, subordinate to the lien of the Mortgage on the Facilities or
other assets of the Company (the "Subordinate Lien").
64. In addition or as an alternative to the security
provided by a letter of credit or the Subordinate Lien, in order
to obtain a more favorable rating on one or more series of Tax
Exempt Bonds and improve the marketability thereof, the Company
may provide (a) 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) security for the holders of Tax
Exempt Bonds and/or the Bank through the issuance and pledge of
one or more new series of Collateral Bonds. Premiums on such
insurance policies will not exceed premiums generally obtainable
at the time of entering into the insurance arrangements by
companies of comparable credit quality on insurance policies
having comparable terms. Collateral Bonds would be issued and
delivered to the Trustee under the Indenture and/or the Bank
and/or the Issuer to evidence, in part, and secure the Company's
obligations under the applicable Facilities Agreement and/or the
Company's obligations to reimburse the Bank under the
Reimbursement Agreement. The principal amount of and interest
rate borne by the Collateral Bonds could be determined in several
ways. First, if the series of Tax-Exempt Bonds bears a fixed
interest rate, Collateral Bonds could be issued in a principal
amount equal to the principal amount of such series and bear
interest at a rate equal to the rate of interest on such series.
Secondly, non-interest bearing Collateral Bonds could be issued in
a principal amount equivalent to the principal amount of such
series plus an amount equal to interest thereon for a specified
period. Thirdly, Collateral Bonds could be issued in a principal
amount equivalent to the principal amount of such series plus an
amount equal to interest on such series for a specified period,
but carry a fixed interest rate that would be lower than the fixed
interest rate of the series of Tax-Exempt Bonds. Fourthly,
Collateral Bonds could be issued in a principal amount equivalent
to the principal amount of the series of Tax-Exempt Bonds at an
adjustable rate of interest, varying with the rate of interest
born by such series of Tax-Exempt Bonds but having a "cap" (not
greater than 13%) above which the interest on Collateral Bonds
could not rise. For further information with respect to the
Reimbursement Agreement, the proposed insurance arrangements and
the Collateral Bonds, reference is made to Exhibits A-3, A-5 and B-
6. The Company will not use a combination of letter of credit,
insurance arrangements, Collateral Bonds and/or Subordinate Liens
to secure any series of Tax-Exempt Bonds unless the resulting
effective interest cost savings on such series is greater than the
total cost of providing such additional security.
65. 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 the Collateral Bonds would be $38.5 million, which would
be in addition to the aggregate limitation on the Bonds and/or
Debentures authorized in Sections B and C above. The terms of the
Collateral Bonds relating to maturity, interest payment dates, if
any, redemption provisions and acceleration will correspond to the
terms of the related TaxExempt Bonds. 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.
66. For further information with respect to the terms of the
Facilities Agreement and Indenture, reference is made to Exhibits
B-5 and B-6.
67. Each series of Tax-Exempt Bonds may be sold by the
Issuer pursuant to arrangements with an underwriter or a group of
underwriters or by private placement in a negotiated sale or
sales. While the Company may not be party to the underwriting or
placement arrangements, such arrangements will assure that the
terms of each series of Tax-Exempt Bonds, and their sale by the
Issuer(s), are satisfactory to the Company, and the Company will
provide certain related representations and certain indemnities
for liabilities arising from material misstatements or omissions
in disclosures made by the Company in connection with the issuance
of Tax-Exempt Bonds. The Company anticipates that interest
payable on Tax-Exempt Bonds will be not includable in the gross
income of the holders thereof for certain state income tax
purposes and for federal income tax purposes under provisions of
the Internal Revenue Code of 1986, as amended, (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 bonds have been, and are
expected to be, lower than the interest rates on bonds of similar
tenor, maturities and quality, on which interest is subject to
federal income tax.
Section H. Acquisition Program
68. The Company proposes to use other available funds, in
addition to or as an alternative for the proceeds from the sale of
Bonds, Debentures, Entity Interests, Preferred and/or TaxExempt
Bonds, to acquire by tender offer, open market or negotiated
purchases or otherwise, at any time or from time to time during
the period through December 31, 2000, in whole or in part, prior
to their respective maturities (subject to any limitations or
conditions on acquisition of particular series) (i) one or more
series of the Company's outstanding First Mortgage Bonds, General
and Refunding Bonds and/or Preferred and/or (ii) one or more
series of outstanding pollution control revenue bonds heretofore
issued for the benefit of the Company ("PCRBs") (all of the
foregoing being herein referred to as the "Outstanding
Securities"; and such program being herein referred to as the "New
Acquisition Program").
69. The Company is currently precluded from redeeming
certain series of the Outstanding Securities due to refunding or
other redemption restrictions. Accordingly, the Company proposes
to repurchase for cash all or a portion of one or more such series
of Outstanding Securities through tender offers and/or negotiated,
open market or other forms of purchase, subject to any limitations
or conditions on the acquisition of particular series. The
Company may also choose to acquire Outstanding Securities of
series that are not subject to refunding or other redemption
limitations by means of tender offers and/or negotiated, open
market or other forms of purchases (subject to any limitations or
conditions on acquisition of particular series) if such
acquisitions 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.
70. The Company will not use the proceeds from the sale of
Bonds, Debentures, Entity Interests, Preferred and/or Tax-Exempt
Bonds to enter into refinancing transactions unless (A) the
estimated present value savings derived from the net difference
between interest or dividend 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 repurchasing,
redemption, tendering and issuing costs, assuming an appropriate
discount rate, determined on the basis of the then estimated after-
tax cost of capital of Entergy and its subsidiaries on a
consolidated basis, or (B) the Company shall have notified the
Commission of the proposed refinancing transaction (including the
terms thereof) by post-effective amendment hereto and shall have
obtained appropriate supplemental authorization from the
Commission to consummate such transaction.
71. The authority sought hereby is in addition to any
acquisitions, retirements or redemptions that may be effected by
the Company pursuant to the exemptions set forth in Rule 42 under
the Holding Company Act or other rules or orders of the Commission
from time to time in effect.
Section I. Other
72. 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 or 33, respectively, of the
Holding Company Act. If the proceeds of such sales are used to
refund outstanding securities, any savings derived from the
refunding transaction will not be used to acquire or otherwise
invest in an EWG or FUCO. Information with respect to Entergy's
EWG investments will be supplied by amendment.
73. 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.
74. Entergy's "aggregate investment" in EWGs and FUCOs is
approximately $197 million, representing approximately 9.7% of
the Entergy's consolidated retained earnings as of June
30, 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,
commissions and expenses, other than those of the
underwriters, to be incurred in connection with the
issuance and sale of the Bonds, Debentures and Preferred,
Entity Interests and Tax-Exempt Bonds will be supplied by
an amendment to be filed hereto. 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, Entity Subordinated
Debentures, Guaranty and Preferred, and 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 voting interests (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 voting interests in the
Issuing Entity, the Issuing Entity's acquisition of the
Entity Subordinated Debentures and the Guaranty.
Section B. Amendment of Articles
In the event the Company undertakes any amendment of the
Articles to create a new class of Preferred and a Proxy
solicitation relating thereto, it believes that Sections
6(a)(2), 7 and 12(e) of the Holding Company Act and Rules
23, 24, 62 and 65 thereunder would apply.
Section C. 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
(v) Facilities Agreement in Sections 6(a) and 7
connection with refunding
Section D. 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 to the proposed transactions in Sections A, B,
C and D above, 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.
Item 5. Procedure
1. The Company requests that the Commission's notice of
proposed transactions published pursuant to Rule 23(e) be
issued by October 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, and the
acquisition of certain PCRBs for or on behalf of the
Company, as described in Item 1, be entered by December
31, 1995, or as soon thereafter as practicable. The
Company consents that the Commission's order authorizing
the above transactions may reserve jurisdiction over (i)
the execution and performance under any Reimbursement
Agreement underlying any Letter of Credit issued as
security for the Company's obligations in connection with
the issuance and sale of Tax-
Exempt Bonds and (ii) the proposed amendment to the
Articles and solicitation of Proxy relating to such
amendment, each in connection with the creation of a new
class of Preferred (but not the existing authorized,
unissued shares of Preferred), pending completion of the
record by the filing of the documents relating thereto.
Upon the completion of each transaction involving the
issuance and sale of Bonds, Debentures, Entity Interests,
Preferred and/or Tax-Exempt Bonds, the Company shall file
a Certificate pursuant to Rule 24 with copies of the
executed documents relating thereto as exhibits.
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.
(a) Exhibits:
*A-1 Mortgage and Deed of Trust, dated as of
February 1, 1988, as amended by ten supplemental
indentures (filed, respectively, as the exhibits and in
the file numbers indicated: A-2(a)-2 to Rule 24
Certificate in File No. 70-7461 (Mortgage); A-2(b)-2 in
File No. 70-7461 (First); A-5(b) to Rule 24 Certificate in
File No. 70-7419 (Second); A4(b) to Rule 24 Certificate in
File No. 707554 (Third); A-1(b)-1 to Rule 24 Certificate
in File No. 70-7737 (Fourth); A-2(b) to Rule 24
Certificate dated November 24, 1992 in File No. 70-7914
(Fifth); A-2(e) to Rule 24 Certificate dated January 22,
1993 in File No. 70-7914 (Sixth); A-2(g) to Form U-1 in
File No. 70-7914 (Seventh); A-2(i) to Rule 24 Certificate
dated November 10, 1993 in File No. 70-7914 (Eighth);A- 2(j)
to Rule 24 Certificate dated July 22, 1994 in File No. 707914
(Ninth); and A-2(l) to Rule 24 Certificate dated April 21,
1995 in File No. 70-7914 (Tenth).
**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, as amended
through July 20, 1995 (filed as Exhibit 3(a) to
Form 10-Q for the quarter ended June 30, 1995 in
File No. 0-320).
**A-7 Proposed form(s) of Articles of Amendment to
Restated Articles of Incorporation, as amended,
establishing new class of preferred stock, if any.
**A-8 Proposed form(s) of Articles of Amendment to
Restated Articles of Incorporation, as amended,
establishing series of the Preferred.
*A-9 By-laws, as amended on April 15, 1995 (filed as
Exhibit B-5(b) to Form U5S for the year ended
December 31, 1994).
**A-10 Proposed form(s) of Preferred Certificate relating
to fixed dividend rate stock.
**A-11 Proposed form(s) of Preferred Certificate relating
to adjustable dividend rate stock.
**A-12 Proposed form(s) of Debenture Indenture.
**A-13 Proposed form(s) of Debenture.
**A-14 Proposed form(s) of Subordinated Debenture
Indenture.
**A-15 Proposed form(s) of Subordinated Debenture.
**A-16 Proposed form(s) of Entity Subordinated Debenture
Indenture.
**A-17 Proposed form(s) of Entity Subordinated Debenture.
**A-18 Proposed form(s) of Entity Agreement of the Issuing
Entity, including the proposed form(s) of Entity
Interests.
**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 Facilities 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.
**B-12 Proposed form(s) of Reimbursement Agreement.
*C-1 Registration Statement, No. 33-53004 relating to
Preferred, (filed in Registration No. 3353004).
*C-2 Registration Statement No. 33-55826, relating to
Bonds (filed in Registration No. 33-55826).
*C-3 Registration Statement No. 33-50507 relating to
Bonds and Preferred (filed in Registration No. 33-
50507).
**C-4 Proposed form of Registration Statement relating to
Debentures.
**C-5 Proposed form of Registration Statement relating to
Subordinated Debentures.
**C-6 Proposed form of Registration Statement relating to
Entity Subordinated Debentures and Entity
Interests.
D Inapplicable.
E Inapplicable.
**F-1 Opinion(s) of Wise Carter Child & Caraway,
Professional Association.
**F-2 Opinion(s) of Reid & Priest LLP.
**G Plan of Financing for the Company and Financial
Data Schedules.
H-l Suggested form of notice of proposed
transactions for publication in the Federal
Register.
**H-2 Form of Proxy Statement with respect to amendment
of Articles, if any.
**H-3 Form of Proxy, if any.
**I-1 Preliminary computations of pro forma earnings
coverage required for the issuance of Bonds under
the Mortgage.
**I-2 Preliminary computations of pro forma earnings
coverage required for the issuance of $100
Preferred under the Articles.
==========================================================
_________________________
* Incorporated herein by reference as indicated.
** To be filed by amendment.
Section B. Financial Statements
Financial Statements of the Company as of June 30,
1995 (reference is made to Exhibit G hereto).
Financial Statements of Entergy Corporation and
subsidiaries, consolidated, as of June 30, 1995.
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 Reports on Form 10-Q
for the quarterly periods ended March 31, 1995 and June
30, 1995 (filed in File No. 0320 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, 1995. 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 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 November 30, 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
Application-Declaration to be signed on its behalf by the undersigned
thereunto duly authorized.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ William J. Regan, Jr.
William J. Regan, Jr.
Vice President and Treasurer
Dated: October 16, 1995
EXHIBIT H-1
Form of Notice of Proposed Transactions
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- ; 70- )
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
MISSISSIPPI POWER & LIGHT COMPANY ("COMPANY")
NOTICE OF PROPOSAL TO ISSUE AND SELL UP TO (i) $530 MILLION OF
THE COMPANY'S GENERAL AND REFUNDING MORTGAGE BONDS ("BONDS")
AND/OR THE COMPANY'S DEBENTURES ("DEBENTURES"); (ii) $75 MILLION
OF (a) PREFERRED SECURITIES OF A SUBSIDIARY OF THE COMPANY
("ENTITY INTERESTS") AND/OR (b) THE COMPANY'S PREFERRED STOCK;
(iii) $35 MILLION OF TAX-EXEMPT BONDS TO BE ISSUED BY THE
APPROPRIATE GOVERNMENTAL AUTHORITY, INCLUDING THE PLEDGE OF THE
COMPANY'S BONDS UP TO $38.5 MILLION AS SECURITY; AND (iv) TO
ACQUIRE CERTAIN OUTSTANDING SECURITIES
, 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 November __, 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.
Mississippi Power & Light Company (70- )
Mississippi Power & Light Company ("MP&L"), 308 East Pearl
Street, Jackson, Mississippi 39201, 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(b), 12(c), 12(d) and 12(e) of the Act and Rules
23, 24, 42, 44, 62 and 65 thereunder.
MP&L seeks authorization to issue and sell not more than
$530,000,000 principal amount of (a) its general and refunding
mortgage bonds ("Bonds") and (b) its debentures ("Debentures"),
issued in one or more new series from time to time no later than
December 31, 2000. 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. One or more series of
Bonds and/or Debentures may include provisions for redemption or
retirement prior to maturity, including restrictions on optional
redemption for a given number of years.
MP&L further proposes to issue and sell, from time to time
not later than December 31, 2000, (a) one or more new series of
the preferred securities of a subsidiary of MP&L ("Entity
Interests") and (b) one or more new series of its preferred stock
(the "Preferred"), in a combined aggregate amount of not to
exceed $75,000,000. Each series of Entity Interests will have a
stated per share 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 Entity Interests may include provisions for
redemption or retirement prior to maturity, including
restrictions on optional redemption for a given number of years.
The price, exclusive of accumulated dividends, and the dividend
rate for each series of Preferred will be determined at the time
of sale. MP&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 forty years after the date of original
issuance. Depending upon market conditions, MP&L may sell one or
more series of Preferred to underwriters for deposit with a bank
or trust company ("Depositary"). The underwriters would then
receive from the Depositary and deliver to the repurchasers in
the subsequent public offering shares of depositary preferred
stock ("Depositary Preferred"), each representing a stated
fraction of a share of the new series of Preferred. Depositary
Preferred would be evidenced by depositary receipts. Each owner
of Depositary Preferred would be entitled proportionally to all
the rights and preferences of the series of Preferred (including
dividends, redemption and voting). A holder of Depositary
Preferred will be entitled to surrender Depositary Preferred to
the Depositary and receive the number of whole shares of
Preferred represented thereby. A holder of Preferred will be
entitled to surrender shares of Preferred to the Depositary and
receive a proportional amount of Depositary Preferred.
MP&L may determine to amend its Restated Articles of
Incorporation, as amended ("Articles"), to establish a new class
of preferred stock having no par value or a nominal par value.
It is expected that such class would rank pari passu with MP&L's
existing class of preferred stock and would be identical with
such class, except as to par value, variations among series, and
voting entitlement in certain cases. In connection with any such
amendment to the Articles, certain other amendments to the
Articles unrelated to the new class of preferred stock,
including, but not limited to, an amendment to increase the
number of authorized shares of MP&L's existing class of preferred
stock and/or amendments to clarify certain provisions with
respect to issuance of preferred stock with market based dividend
rates and varying dividend payment periods, may also be adopted.
Approval of outstanding stockholders of MP&L would be required to
effect such an amendment to the Articles. In connection with
such an amendment, MP&L would thus solicit proxies from holders
of its outstanding Preferred and seek the consent of Entergy
Corporation, the sole holder of its common stock.
MP&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.
MP&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.
MP&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"). MP&L proposes, from
time to time through December 31, 2000, to enter into one or more
leases, subleases, installment sale agreements, refunding
agreements or other agreements and/or supplements and/or
amendments thereto (each and all of the foregoing being referred
to herein as the "Agreement") with one or more issuing
governmental authorities (individually and collectively being
referred to herein as the "Authority"), pursuant to which the
Authority may issue one or more series of tax-exempt revenue
bonds ("Tax-Exempt Bonds") in an aggregate principal amount not
to exceed $35,000,000. The net proceeds from the sale of
Tax-Exempt Bonds will be deposited by the Authority 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.
MP&L further proposes, under the Agreement, to purchase,
acquire, construct and install the Facilities unless the
Facilities are already in operation. Pursuant to the Agreement,
MP&L will be obligated to make payments sufficient to pay the
principal or redemption price of, the premium, if any, and the
interest on Tax-Exempt Bonds as the same become due and payable.
Under the Agreement, MP&L will also be obligated to pay certain
fees incurred in the transactions.
The price to be paid to the Authority 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, MP&L may (1)
arrange for one or more letters of credit from one or more banks
(collectively, "Bank") in favor of the Trustee (in connection
therewith, MP&L may enter into a Reimbursement Agreement pursuant
to which MP&L would agree to reimburse the Bank for amounts drawn
under the letters of credit and to pay commitment and/or letter
of credit fees), (2) provide an insurance policy for the payment
of the principal, premium, if any, interest and purchase
obligations in connection with one or more series of Tax-Exempt
Bonds, or (3) obtain authentication of one or more new series of
Bonds ("Collateral Bonds") to be issued under MP&L's General and
Refunding Mortgage on the basis of unfunded net property
additions and/or previously retired First Mortgage Bonds or
General and Refunding Mortgage Bonds and delivered and pledged to
the Trustee and/or the Bank to evidence and secure MP&L's
obligations under the Agreement and/or the Reimbursement
Agreement. In addition, MP&L may grant to the Authority, the
Bank or the Trustee a lien, subordinate to the liens of MP&L's
First Mortgage and General and Refunding Mortgage, on the
Facilities.
MP&L also proposes to acquire, through tender offers or
otherwise, certain of its outstanding securities, including its
outstanding first mortgage bonds, its general and refunding
mortgage bonds, its outstanding preferred stock and/or
outstanding pollution control revenue bonds issued for MP&L's
benefit, at any time, prior to December 31, 2000.
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
Jonathan G. Katz
Secretary
