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
Arkansas Power & Light Company
425 West Capitol, 40th Floor
Little Rock, Arkansas 72201
(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)
Glenn E. Harder
Vice President - Financial
Strategies and Treasurer
Arkansas Power & Light Company
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. Paul B. Benham, III, Esq.
Entergy Services, Inc. Friday, Eldredge & Clark
225 Baronne Street 2000 First Commercial Building
New Orleans, Louisiana 70112 400 West Capitol Avenue
Little Rock, Arkansas 72201
Bonnie Wilkinson, Esq. David P. Falck, Esq.
Reid & Priest Winthrop, Stimson, Putnam &
40 West 57th Street Roberts
New York, New York 10019 New York, New York 10004
Item 1. Description of Proposed Transactions.
1. Arkansas Power & Light Company ("Company"), an
electric utility company operating principally in the state of
Arkansas, is a subsidiary of Entergy Corporation, which is a
registered holding company under the Public Utility Holding
Company Act of 1935 ("1935 Act"). The Company proposes to enter
into arrangements for the issuance and sale, by one or more
governmental authorities (each an "Issuer"), of one or more
series of tax-exempt bonds in an aggregate principal amount not
to exceed $200 million ("Tax-Exempt Bonds") at one time or from
time to time through December 31, 1996.
2. The Company would enter into one or more
installment sale agreements or loan agreements and/or one or more
supplements or amendments thereto (collectively, the "Agreement")
contemplating the issuance and sale by the Issuer(s) of one or
more series of Tax-Exempt Bonds pursuant to one or more trust
indentures and/or one or more supplements thereto (collectively,
the "Indenture") between the Issuer and one or more trustees
(collectively the "Trustee"). The proceeds of the sale of Tax-
Exempt Bonds, net of any underwriters' discounts or other
expenses payable from proceeds, will be applied to acquire and
construct certain pollution control or sewage and solid waste
disposal facilities at the Company's generating plants
("Facilities") or to refinance outstanding tax-exempt bonds
issued for that purpose.
3. If the Agreement is an installment sale agreement,
the Company would sell Facilities to the Issuer for cash and
simultaneously repurchase such Facilities from the Issuer for a
purchase price payable on an installment basis over a period of
years. If the Agreement is a loan agreement, the Issuer will
loan the proceeds of the sale of Tax-Exempt Bonds to the Company,
and the Company will agree to repay the loan on an installment
payment basis over a period of years. Such installment payments
or loan repayments will be in amounts sufficient (together with
any other moneys held by the Trustee under the Indenture and
available for the purpose) to pay the principal or purchase price
of, the premium, if any, and the interest on the related series
of Tax-Exempt Bonds as the same become due and payable, and will
be made directly to the Trustee pursuant to an assignment and
pledge thereof by the Issuer to the Trustee as set forth in the
Indenture. Under the Agreement, the Company will also be
obligated to pay (i) the fees and charges of the Trustee and any
registrar or paying agent under the Indenture and, if any, the
Remarketing Agent and the Tender Agent hereinafter referred to,
(ii) all expenses incurred by the Issuer in connection with its
rights and obligations under the Agreement, (iii) all expenses
necessarily incurred by the Issuer or the Trustee under the
Indenture in connection with the transfer or exchange of Tax-
Exempt Bonds, and (iv) all other payments which the Company
agrees to pay under the Agreement.
4. The Indenture may provide that, upon the
occurrence of certain events relating to the operation of the
Facilities financed, the 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 stated portions of Tax-Exempt Bonds of such series
are to be retired at stated times. Tax-Exempt Bonds may be
subject to mandatory redemption in certain other cases. The
payments by the Company under the 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, and
the premium, if any, thereon together with interest accrued or to
accrue to the redemption date on such bonds.
5. It is proposed that the Tax-Exempt Bonds mature
not less than five years from the first day of the month of
issuance nor later than 40 years from the date of issuance. Tax-
Exempt Bonds will be subject to optional redemption, at the
direction of the Company, in whole or in part at the redemption
prices (expressed as percentages of principal amount) plus
accrued interest to the redemption date, and at the times, set
forth in the Indenture.
6. The Agreement and the Indenture may provide for a
fixed interest rate or for an adjustable interest rate for each
series of the Tax-Exempt Bonds as hereinafter described. No
series of Tax-Exempt Bonds would be sold if the fixed interest
rate or initial adjustable interest rate thereon would exceed
13%. If the series of Tax-Exempt Bonds has an adjustable
interest rate, the interest rate during the first Rate Period
(hereinafter referred to) would be determined in discussions
between the Company and the purchasers thereof from the Issuer
and be based on the current tax-exempt market rate for comparable
bonds having a maturity comparable to the length of the initial
Rate Period. Thereafter, for each Rate Period, the interest rate
on such Tax-Exempt Bonds would be that rate (subject to a
specified maximum rate that will not be greater than 13%) which
will be sufficient to remarket such Tax-Exempt Bonds at their
principal amount. Such interest rates would be determined based
upon the market rates for bonds of comparable maturity and
quality. Paragraphs 7-10 below relate to Tax-Exempt Bonds having
an adjustable interest rate.
7. The term "Rate Period," as used herein, means a
period during which the interest rate on such Tax-Exempt Bonds of
a particular series bearing an adjustable rate (or method of
determination of such interest rate) is fixed. The initial Rate
Period would commence on the date as of which interest begins to
accrue on such Tax-Exempt Bonds. The length of each Rate Period
would be not less than one day nor more than five years.
8. The Agreement and the Indenture would provide that
holders of Tax-Exempt Bonds would have the right to tender or be
required to tender their Tax-Exempt Bonds and have them purchased
at a price equal to the principal amount thereof, plus any
accrued and unpaid interest thereon, on dates specified in, or
established in accordance with, the Indenture. A Tender Agent
may be appointed to facilitate the tender of any Tax-Exempt Bonds
by holders. Any holders of Tax-Exempt Bonds wishing to have such
Tax-Exempt Bonds purchased may be required to deliver such Tax-
Exempt Bonds during a specified period of time preceding such
purchase date to the Tender Agent, if one shall be appointed, or
to the Remarketing Agent appointed to offer such tendered Tax-
Exempt Bonds for sale.
9. Under the Agreement the Company would be obligated
to pay amounts equal to the amounts to be paid by the Remarketing
Agent or the Tender Agent pursuant to the Indenture for the
purchase of Tax-Exempt Bonds so tendered, such amounts to be paid
by the Company on the dates such payments by the Remarketing
Agent or the Tender Agent are to be made; provided, however, that
the obligation of the Company to make any such payment under the
Agreement would be reduced by the amount of any other moneys
available therefor, including the proceeds of the sale of such
tendered Tax-Exempt Bonds by the Remarketing Agent.
10. Upon the delivery of such Tax-Exempt Bonds by
holders to the Remarketing Agent or the Tender Agent for
purchase, the Remarketing Agent would use its best efforts to
sell such Tax-Exempt Bonds at a price equal to the stated
principal amount of such Tax-Exempt Bonds.
11. In order to obtain a more favorable rating on one
or more series of the 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
$226 million from a bank (the "Bank") in favor of the Trustee.
In such event, payments with respect to principal, premium, if
any, interest and purchase obligations in connection with such
Tax-Exempt Bonds coming due during the term of such letter of
credit would be secured by, and payable from funds drawn under,
the letter of credit. In order to induce the Bank to issue such
letter of credit, the Company would enter into a Letter of Credit
and Reimbursement Agreement ("Reimbursement Agreement") with the
Bank pursuant to which the Company would agree to reimburse the
Bank for all amounts drawn under such letter of credit within a
specified period after the date of the draw and with interest
thereon. The terms of the Reimbursement Agreements would
correspond to the terms of the Letter of Credit.
12. It is anticipated that the Reimbursement Agreement
would require the payment by the Company to the Bank of annual
letter of credit fees not to exceed 1.25% of the face amount of
the letter of credit per annum and perhaps an up-front fee not to
exceed .25% of the face amount of the letter of credit. Any such
letter of credit may expire or be terminated prior to the
maturity date of related Tax-Exempt Bonds and, in connection with
such expiration or termination, such Tax-Exempt Bonds may be made
subject to mandatory redemption or purchase on or prior to the
date of expiration or termination of such letter of credit,
possibly subject to the right of owners of Tax-Exempt Bonds not
to have their Tax-Exempt Bonds redeemed or purchased. Provision
may be made for extension of the term of any such letter of
credit or for the replacement thereof, upon its expiration or
termination, by another letter of credit from the Bank or a
different bank. See Exhibit B-4 for further information on the
Reimbursement Agreement.
13. In addition or as an alternative to the security
provided by a letter of credit, in order to obtain a more
favorable rating on Tax-Exempt Bonds and consequently improve the
marketability thereof, the Company may (a) determine to provide
an insurance policy for the payment of the principal of and/or
interest and/or premium on the Tax-Exempt Bonds (see Exhibit B-5
for further information), and/or (b) provide security for holders
of Tax-Exempt Bonds and/or the Bank equivalent to the security
afforded to holders of First Mortgage Bonds outstanding under the
Company's Mortgage by obtaining the authentication of and
pledging one or more new series of First Mortgage Bonds
("Collateral Bonds") under the Mortgage as it may be
supplemented. Collateral Bonds would be issued on the basis of
unfunded net property additions and/or previously-retired First
Mortgage Bonds and delivered to the Trustee under the Indenture
and/or the Bank to evidence and secure the Company's obligation
to pay the purchase price of the related Facilities or repay the
loan made by the Issuer under the Agreement and the Company's
obligation to reimburse the Bank under the Reimbursement
Agreement. These Collateral Bonds could be issued in several
ways. First, if the Tax-Exempt Bonds bear a fixed interest rate,
Collateral Bonds could be issued in a principal amount equal to
the principal amount of such Tax-Exempt Bonds and bear interest
at a rate equal to the rate of interest on such Tax-Exempt Bonds.
Secondly, they could be issued in a principal amount equivalent
to the principal amount of such Tax-Exempt Bonds plus an amount
equal to interest on those Bonds for a specified period. In such
a case, Collateral Bonds would bear no interest. Thirdly,
Collateral Bonds could be issued in a principal amount equivalent
to the principal amount of such Tax-Exempt Bonds or in such
amount plus an amount equal to interest on those Bonds for a
specified period, but carry a fixed interest rate that would be
lower than the fixed interest rate of the Tax-Exempt Bonds.
Fourthly, they could be issued in a principal amount equivalent
to the principal amount of Tax-Exempt Bonds at an adjustable rate
of interest, varying with such Tax-Exempt Bonds but having a
"cap" (not greater than 13%) above which the interest on
Collateral Bonds could not rise.
14. 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 13%. The maximum
aggregate principal amount of the Collateral Bonds would be $226
million. The terms of the Collateral Bonds relating to maturity,
interest payment dates, if any, redemption provisions and
acceleration will correspond to the terms of the related Tax-
Exempt Bonds. Upon issuance, the terms of the Collateral Bonds
will not vary during the life of such series except for the
interest rate in the event the Collateral Bonds bear interest at
an adjustable rate.
15. For further information with respect to the terms
of the Agreement and Indenture, reference is made to Exhibits B-
1, B-2 and B-3.
16. It is contemplated that the 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. The Company will not be party to the
underwriting or placement arrangements; however, the Agreement
will provide that the terms of the Tax-Exempt Bonds, and their
sale by the Issuer, shall be satisfactory to the Company. The
Company understands that interest payable on the Tax-Exempt Bonds
will not be included in the gross income of the holders thereof
for Federal income tax purposes under the provisions of Section
103 of the Internal Revenue Code of 1986, as amended to the date
of issuance of Tax-Exempt Bonds (except for interest on any Tax-
Exempt Bond during a period in which it is held by a person who
is a "substantial user" of the Facilities or a "related person"
within the meaning of Section 147(a) of such Code).
17. The Company has been advised that the interest
rates on tax-exempt bonds have been and are expected at the
time(s) of issuance of Tax-Exempt Bonds to be lower than the
interest rates on bonds of similar tenor and maturities and
comparable quality, interest on which is fully subject to Federal
income tax.
18. The Company shall not use the proceeds from the
Agreement to enter into refinancing transactions unless: (1) 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 Corporation and
its subsidiaries, consolidated; or (2) the Company shall have
notified the Commission of the proposed refinancing transaction
(including the terms thereof) by post-effective amendment hereto
and obtained appropriate supplemental authorization.
19. The proceeds to be received from the issuance and
sale of the Tax-Exempt Bonds will not be used to invest directly
or indirectly in an exempt wholesale generator ("EWG") or foreign
utility company, as defined in Section 32 or 33, respectively, of
the 1935 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 foreign utility company. Information with respect to
Entergy's EWG investments will be supplied by amendment.
Item 2. Fees, Commissions and Expenses.
To be supplied by amendment
Item 3. Applicable Statutory Provisions.
The sections of the 1935 Act and the rules thereunder
which the Applicant-Declarant considers may be applicable to the
proposed transactions are set forth below:
(a) Entry by the Company into Sections 6(a) and 7 and Rule
the Agreement in the form 50
of a loan agreement
(b) Entry by the Company into
the Agreement in the form
of an installment sale
agreement
(1) Disposition of Section 12(d) and exempt by
Facilities reason of Rule 44(b)(3)
(2) Reacquisition Sections 9(a) and 10
of Facilities
(c) Reimbursement Agreement Sections 6(a) and 7 and
exempt from Rule 50 under
Rule 50(a)(2)
(d) Collateral Bonds Exempt from Section 6(a)
pursuant to Rule 52
The Company believes that entry into any Agreement in the
form of a loan agreement with the Issuer constitutes issuance of
a "security" for purposes of the 1935 Act and that, although such
issuance may be subject to Rule 50, competitive bidding would be
inappropriate under the circumstances described herein inasmuch
as any such Agreement would be entered into solely to evidence
the Company's obligation to make payments sufficient to pay the
principal of and premium, if any, and interest on the Issuer's
Tax-Exempt Bonds.
In the event that the Commission deems any other Section
of the 1935 Act or Rule thereunder to be applicable, the Company
requests that the Commission's order or orders hereon also be
issued under and with respect to such other section or rule.
Item 4. Regulatory Approval.
The Arkansas Public Service Commission ("APSC") and the
Tennessee Public Service Commission ("TPSC") have jurisdiction to
pass upon the authority of the Company to carry out the proposed
transactions. Reference is made to Exhibits D-1a through D-2b
hereto, for information with respect to the proceedings before
the APSC and the TPSC. No other state regulatory body or agency
and no Federal commission or agency other than this Commission
has, or has asserted, jurisdiction over the transaction proposed
herein.
Item 5. Procedure.
The Company respectfully requests that the Commission's
order authorizing the transactions proposed herein be issued on
or before May 20, 1994. The Company consents that the
Commission's order may contain reservations of jurisdiction over
the Company's entering into arrangements for the issuance of a
letter of credit and insurance arrangements, pending completion
of the record with respect thereto. 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 period between the issuance of the Commission's
order and the date it is to become effective.
Item 6. Exhibits and Financial Statements.
(a) Exhibits
*B-1 Form of Loan Agreement between the Company and the
Issuer.
*B-2 Form of Installment Sale Agreement between the
Company and the Issuer.
*B-3 Form of Trust Indenture between the Issuer and the
Trustee.
*B-4 From of Reimbursement Agreement (including Letter of
Credit).
*B-5 Form of insurance policy relating to bond insurance.
*D-1a Application to the Arkansas Public Service
Commission.
*D-1b Order of the Arkansas Public Service Commission.
*D-2a Application to the Tennessee Public Service
Commission.
*D-2b Order of the Tennessee Public Service Commission.
*F-1 Opinion of Reid & Priest.
*F-2 Opinion of Friday, Eldredge & Clark.
G Form of Notice of Proposed Transactions.
*To be filed by amendment.
(b) Financial Statements
Financial Statements of the Company and of Entergy
Corporation and Subsidiaries, consolidated, each
as of December 31, 1993 (including pro forma
journal entries).
Notes to Financial Statements (included in the
Annual Report on Form 10-K of the Company and of
Entergy Corporation and subsidiaries for the
fiscal year ended December 31, 1993 in File Nos. 1-
10764 and 1-11299, respectively, and incorporated
herein by reference).
Except as reflected in the Financial Statements,
including the notes thereto, no material changes
not in the ordinary course of business have taken
place since December 31, 1993.
Item 7. Information as to Environmental Effects.
(a) As more fully described in Item 1, the proposed
transactions subject to the jurisdiction of the Commission
involve the refinancing of certain facilities and, as such, do
not involve a major Federal action having a significant impact on
the human environment.
(b) Not applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this
statement to be signed on its behalf by the undersigned thereunto
duly authorized.
ARKANSAS POWER & LIGHT COMPANY
By: /s/ Glenn E. Harder
Glenn E. Harder
Vice President-Financial
Strategies and Treasurer
Date March 31, 1994
EXHIBIT G
[Form of Notice of Proposed Transactions]
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- )
Filings Under the Public Utility Holding Company Act of 1935
("Act")
____________, 1994
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 _____, 1994 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.
Arkansas Power & Light Company (70-____)
Arkansas Power & Light Company ("AP&L"), 425 West Capitol,
Little Rock, Arkansas 72201, an electric public-utility
subsidiary company of Entergy Corporation, a registered holding
company, has filed an application-declaration under Sections
6(a), 7 and 12(d) of the Act and Rules 44, 50 and 52 thereunder.
AP&L proposes to enter into arrangements for the issuance
and sale by one or more governmental authorities ("Issuers") of
one or more series of tax-exempt bonds in an aggregate principal
amount not to exceed $200 million ("Tax-Exempt Bonds") at one
time or from time to time through December 31, 1996. AP&L
proposes to enter into one or more installment sale agreements or
loan agreements and/or one or more supplements or amendments
thereto ("Agreement") pursuant to which the Issuers would issue
the Tax-Exempt Bonds under one or more indentures and/or
supplements thereto ("Indenture"). AP&L further proposes, if the
Agreement is an installment sale agreement, to sell certain
pollution control or sewage and solid waste disposal facilities
at its generating plants ("Facilities") to the Issuers for cash
and repurchase such Facilities from the Issuers for a purchase
price payable on an installment basis over a period of years. If
the Agreement is a loan agreement, the Issuers will loan the
proceeds of the sale of Tax-Exempt Bonds to AP&L, and AP&L will
agree to repay the loan on an installment payment basis over a
period of years. Such installment payments or lower repayments
will be in amounts sufficient togeth with any other moneys
held by the trustee under the Indenture and available for the
purpose) to pay the principal or purchase price of, the premium,
if any, and the interest on the related series of Tax-Exempt
Bonds as the same become due and payable. AP&L will also be
obligated under the Agreement to pay certain fees incurred in the
transactions.
The Agreement and the Indenture will provide for either a
fixed interest rate or for an adjustable interest rate for each
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 13%, and subsequent interest rates for
adjustable interest rate Tax-Exempt Bonds will not exceed 13%.
The Tax-Exempt Bonds will mature not less than five years from
the first day of the month of issuance nor later than forty years
fromthe date of issuance. Each series may be subject to optional
or mandatory redemption and/or sinking fund provisions.
In order to obtain a more favorable rating on one or more
series of the Tax-Exempt Bonds, AP&L may arrange for one or more
irrevocable letter(s) of credit for an aggregate amount up to
$226 million from a bank (the "Bank") in favor of the Trustee,
and enter into a Letter of Credit and Reimbursement Agreement
with the Bank pursuant to which AP&L would agree to reimburse the
Bank for drawings under the letter of credit to make payments on
the Tax-Exempt Bonds. AP&L anticipates annual letter of credit
fees not to exceed 1.25% of the face amount of the letter of
credit per annum and an up-front fee not to exceed .25% of the
face amount of the letter of credit.
In addition to or as an alternative to the letter of credit,
AP&L may determine to provide an insurance policy for payments on
the Tax-Exempt Bonds and/or obtain authentication of one or more
new series of first mortgage bonds ("Collateral Bonds") under its
mortgage as it may be supplemented. Collateral Bonds would be
issued (1) in a principal amount equal to the Tax-Exempt Bonds
and bear interest at a rate equal to the rate of interest on the
Tax-Exempt Bonds; (2) in a principal amount equal to the
principal amount of the Tax-Exempt Bonds plus an amount equal to
interest on those Tax-Exempt Bonds for a specified period and
bear no interest; (3) in a principal amount equal to the
principal amount of Tax-Exempt Bonds or in such amount plus an
amount equal to interest on those Tax-Exempt Bonds for a
specified period, but carrying a fixed interest rate that would
be lower than the fixed interest rate of the Tax-Exempt Bonds; or
(4) in a principal amount equal to the principal amount of the
Tax-Exempt Bonds and bear an adjustable rate of interest that
would not exceed 13%. Each series of Collateral Bonds that bears
interest would do so at a fixed interest rate or initial
adjustable interest rate not to exceed 13%. The maximum
aggregate principal amount of Collateral Bonds would be $226
million. The terms of the Collateral Bonds would correspond to
the terms of the related Tax-Exempt Bonds.
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
Jonathan G. Katz
Secretary
FINANCIAL STATEMENTS
_________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM U-1
ARKANSAS POWER & LIGHT COMPANY
___________________________________________
AS OF DECEMBER 31, 1993
(Unaudited)
_____________________________________________
Pages 1 through 5
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
JOURNAL ENTRIES
(in Thousands)
Entries to give effect to the sale of an aggregate principal amount not
to exceed $200,000 of New Tax-Exempt bonds and the refunding of up to
$195,700 of outstanding Tax-Exempt Bonds. (Outstanding Tax-Exempt
Bonds)
Entry No. 1
Cash................................... $200,000
New Tax-Exempt Bonds....................... $200,000
To record the sale of $200,000 of New Tax-Exempt Bonds.
Entry No. 2
Tax-Exempt Bonds........................ $195,700
Cash...................................... $195,700
To record the acquisition of $195,700 aggregate principal amount of
Outstanding Tax-Exempt Bonds.
Entry No. 3
Cash..................................... $ 2,200
Interest on Long-term Debt................ $ 2,200
To record the net decrease in interest expense due to the acquisition
of the Outstanding Tax-Exempt Bonds.
Entry No. 4
Income Taxes............................ $863
Cash...................................... $863
To record the net increase in income taxes due to the net decrease in
interest expense associated with the issuance of the New Tax-Exempt
Bonds.
Decrease in interest expense..... $2,200
Statutory Composite Federal and
State Income Tax Rate of 39.23%.. $ 863
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
PRO FORMA BALANCE SHEET
December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
ASSETS Transaction Filing Transaction
----------- ---------- -----------
(In thousands)
Utility Plant:
Electric $4,098,355 0 $4,098,355
Property under capital leases 62,139 0 62,139
Construction work in progress 197,005 0 197,005
Nuclear fuel under capital lease 93,606 0 93,606
---------- ------ ----------
Total 4,451,105 0 4,451,105
Less - Accumulated depreciation
and amortization 1,604,318 0 1,604,318
---------- ------ ----------
Utility plant - net 2,846,787 0 2,846,787
---------- ------ ----------
Other Property and Investments:
Investment in subsidiary companies
- at equity 11,232 0 11,232
Decommissioning trust fund 108,192 0 108,192
Other - at cost (less accumulated
depreciation) 4,257 0 4,257
---------- ------ ----------
Total 123,681 0 123,681
---------- ------ ----------
Current Assets:
Cash 1,825 $5,637 7,462
Accounts receivable:
Customer (less allowance for
doubtful accounts of $2.1 million 65,641 0 65,641
Associated companies 18,312 0 18,312
Other 20,817 0 20,817
Accrued unbilled revenues 83,378 0 83,378
Fuel inventory - at average cost 51,920 0 51,920
Materials and supplies - at 81,398 0 81,398
average cost
Rate deferrals 92,592 0 92,592
Deferred excess capacity 9,115 0 9,115
Prepayments and other 28,303 0 28,303
---------- ------ ----------
Total 453,301 5,637 458,938
---------- ------ ----------
Deferred Debits:
Rate deferrals 475,387 0 475,387
Deferred excess capacity 28,465 0 28,465
SFAS 109 regulatory asset - net 234,015 0 234,015
Unamortized loss on reacquired debt 60,169 0 60,169
Other 112,300 0 112,300
---------- ------ ----------
Total 910,336 0 910,336
---------- ------ ----------
TOTAL $4,334,105 $5,637 $4,339,742
========== ====== ==========
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
PRO FORMA BALANCE SHEET
December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
CAPITALIZATION AND LIABILITIES Transactions Filing Transactions
------------ --------- ------------
(In thousands)
Capitalization:
Common stock, $0.01 par value,
authorized 325,000,000 shares; issued
and outstanding 46,980,196 shares $470 0 $470
Paid-in capital 590,844 0 590,844
Retained earnings 448,811 $1,337 450,148
---------- ------ ----------
Total common shareholder's equity 1,040,125 1,337 1,041,462
Preferred stock:
Without sinking fund 176,350 0 176,350
With sinking fund 70,027 0 70,027
Long-term debt 1,313,315 4,300 1,317,615
---------- ------ ----------
Total 2,599,817 5,637 2,605,454
---------- ------ ----------
Other Noncurrent Liabilities:
Obligations under capital leases 94,861 0 94,861
Other 59,750 0 59,750
---------- ------ ----------
Total 154,611 0 154,611
---------- ------ ----------
Current Liabilities:
Currently maturing long-term debt 3,020 0 3,020
Notes payable:
Associated companies 21,395 0 21,395
Other 667 0 667
Accounts payable:
Associated companies 45,177 0 45,177
Other 93,611 0 93,611
Customer deposits 15,241 0 15,241
Taxes accrued 43,013 0 43,013
Accumulated deferred income taxes 32,367 0 32,367
Interest accrued 31,410 0 31,410
Dividends declared 5,049 0 5,049
Nuclear refueling reserve 3,070 0 3,070
Co-owner advances 39,435 0 39,435
Deferred fuel cost 16,130 0 16,130
Obligations under capital leases 60,883 0 60,883
Other 29,789 0 29,789
---------- ------ ----------
Total 440,257 0 440,257
---------- ------ ----------
Deferred Credits:
Accumulated deferred income taxes 876,618 0 876,618
Accumulated deferred investment
tax credits 154,723 0 154,723
Other 108,079 0 108,079
---------- ------ ----------
Total 1,139,420 0 1,139,420
---------- ------ ----------
TOTAL $4,334,105 $5,637 $4,339,742
========== ====== ==========
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
PRO FORMA STATEMENT OF INCOME
For the Year Ended December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
Transactions Filing Transactions
------------ --------- ------------
(In thousands)
Operating Revenues $1,591,568 0 $1,591,568
---------- ------ ----------
Operating Expenses:
Operation:
Fuel for electric generation
and fuel-related expenses 257,983 0 257,983
Purchased power 349,718 0 349,718
Other 294,103 0 294,103
Maintenance 109,724 0 109,724
Depreciation and decommissioning 135,530 0 135,530
Taxes other than income taxes 28,626 0 28,626
Income taxes 18,746 $863 19,609
Amortization of rate deferrals 160,916 0 160,916
---------- ------ ----------
Total 1,355,346 863 1,356,209
---------- ------ ----------
Operating Income 236,222 (863) 235,359
---------- ------ ----------
Other Income:
Allowance for equity funds used
during construction 3,627 0 3,627
Miscellaneous - net 64,884 0 64,884
Income taxes - (debit) (32,451) 0 (32,451)
---------- ------ ----------
Total 36,060 0 36,060
---------- ------ ----------
Interest Charges:
Interest on long-term debt 107,771 (2,200) 105,571
Other interest - net 11,819 0 11,819
Allowance for borrowed funds
used during construction (2,418) 0 (2,418)
---------- ------ ----------
Total 117,172 (2,200) 114,972
---------- ------ ----------
Income before Cumulative Effect of
a Change in Accounting Principle 155,110 1,337 156,447
Cumulative Effect to January 1, 1993,
of Accruing Unbilled Revenues (net
of income taxes of $31,140) 50,187 0 50,187
---------- ------ ----------
Net Income $205,297 1,337 $206,634
Preferred Stock Dividend Requirements 20,877 0 20,877
---------- ------ ----------
Earnings Applicable to Common Stock $184,420 1,337 $185,757
========== ====== ==========
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
PRO FORMA STATEMENT OF RETAINED EARNINGS
For the Year Ended December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
Transactions Filing Transactions
------------ ---------- ------------
(In thousands)
Retained Earnings - January 1 $420,691 $1,337 $422,028
Add:
Net Income 205,297 0 205,297
-------- ------ --------
Total 625,988 1,337 627,325
-------- ------ --------
Deduct:
Dividends declared:
Preferred stock 20,877 0 20,877
Common stock 156,300 0 156,300
-------- ------ --------
Total 177,177 0 177,177
-------- ------ --------
Retained Earnings - December 31 $448,811 $1,337 $450,148
======== ====== ========
FINANCIAL STATEMENTS
_________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM U-1
ENTERGY CORPORATION
AND SUBSIDIARIES CONSOLIDATED
___________________________________________
AS OF DECEMBER 31, 1993
(Unaudited)
_____________________________________________
Pages 1 through 4
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED BALANCE SHEET
December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
ASSETS Transactions Filing Transactions
(In thousands)
<S> <C> <C> <C>
Utility Plant:
Electric $20,848,844 0 $20,848,844
Plant acquisition adjustment - GSU 380,117 0 380,117
Electric plant under leases 663,024 0 663,024
Property under capital leases -
electric 175,276 0 175,276
Natural gas 156,452 0 156,452
Steam products 75,689 0 75,689
Construction work in progress 533,112 0 533,112
Nuclear fuel under capital leases 329,433 0 329,433
Nuclear fuel 17,760 0 17,760
----------- ------ -----------
Total 23,179,707 0 23,179,707
Less - Accumulated depreciation
and amortization 7,157,981 0 7,157,981
----------- ------ -----------
Utility plant - net 16,021,726 0 16,021,726
----------- ------ -----------
Other Property and Investments:
Decommissioning trust funds 172,960 0 172,960
Other 183,597 0 183,597
----------- ------ -----------
Total 356,557 0 356,557
----------- ------ -----------
Current Assets:
Cash and cash equivalents:
Cash 27,345 $5,637 32,982
Temporary cash investments -
at cost, which approximates market 536,404 0 536,404
----------- ------ -----------
Total cash and cash equivalents 563,749 5,637 569,386
Special deposits 36,612 0 36,612
Notes receivable 17,710 0 17,710
Accounts receivable:
Customer (less allowance for doubtful
accounts of $8.8 million) 315,796 0 315,796
Other 81,931 0 81,931
Accrued unbilled revenues 257,321 0 257,321
Fuel inventory - at average cost and LIFO 110,204 0 110,204
Materials and supplies -
at average cost 360,353 0 360,353
Rate deferrals 333,311 0 333,311
Prepayments and other 98,144 0 98,144
----------- ------ -----------
Total 2,175,131 5,637 2,180,768
----------- ------ -----------
Deferred Debits and Other Assets:
Rate deferrals 1,876,051 0 1,876,051
SFAS 109 regulatory asset - net 1,385,824 0 1,385,824
Long-term receivables 228,030 0 228,030
Unamortized loss on reacquired debt 210,698 0 210,698
Other 622,680 0 622,680
----------- ------ -----------
Total 4,323,283 0 4,323,283
----------- ------ -----------
TOTAL $22,876,697 $5,637 $22,882,334
=========== ====== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED BALANCE SHEET
December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
CAPITALIZATION AND LIABILITIES Transactions Filing Transactions
(In thousands)
<S> <C> <C> <C>
Capitalization:
Common stock, $0.01 par value,
authorized 500,000,000 shares; issued
and outstanding 231,219,737 shares $2,312 0 $2,312
Paid-in capital 4,223,682 0 4,223,682
Retained earnings 2,310,082 $1,337 2,311,419
----------- ------ -----------
Total common shareholders' equity 6,536,076 1,337 6,537,413
Subsidiary's preference stock 150,000 0 150,000
Subsidiaries' preferred stock:
Without sinking fund 550,955 0 550,955
With sinking fund 349,053 0 349,053
Long-term debt 7,355,962 4,300 7,360,262
----------- ------ -----------
Total 14,942,046 5,637 14,947,683
----------- ------ -----------
Other Noncurrent Liabilities:
Obligations under capital leases 322,867 0 322,867
Other 270,318 0 270,318
----------- ------ -----------
Total 593,185 0 593,185
----------- ------ -----------
Current Liabilities:
Currently maturing long-term debt 322,010 0 322,010
Notes payable 43,667 0 43,667
Accounts payable 413,727 0 413,727
Customer deposits 127,524 0 127,524
Taxes accrued 118,267 0 118,267
Accumulated deferred income taxes 44,637 0 44,637
Interest accrued 210,894 0 210,894
Dividends declared 13,404 0 13,404
Deferred revenue - gas supplier
judgement proceeds 14,632 0 14,632
Deferred fuel cost 4,528 0 4,528
Obligations under capital leases 194,015 0 194,015
Other 240,471 0 240,471
----------- ------ -----------
Total 1,747,776 0 1,747,776
----------- ------ -----------
Deferred Credits:
Accumulated deferred income taxes 3,858,337 0 3,858,337
Accumulated deferred investment
tax credits 793,375 0 793,375
Other 941,978 0 941,978
----------- ------ -----------
Total 5,593,690 0 5,593,690
----------- ------ -----------
TOTAL $22,876,697 $5,637 $22,882,334
=========== ====== ===========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<CAPTION>
ENTERGY CORPORATION AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 1993
(Unaudited)
Adjustments to Reflect
Transactions Proposed
Before In Present After
Transaction Filing Transaction
(In thousands, except share data)
<S> <C> <C> <C>
Operating Revenues:
Electric $4,394,346 0 $4,394,346
Natural gas 90,991 0 90,991
---------- ------ ----------
Total 4,485,337 0 4,485,337
---------- ------ ----------
Operating Expenses:
Operation:
Fuel for electric generation
and fuel-related expenses 859,641 0 859,641
Purchased power 278,070 0 278,070
Gas purchased for resale 52,592 0 52,592
Other 813,555 0 813,555
Maintenance 306,666 0 306,666
Depreciation and decommissioning 443,550 0 443,550
Taxes other than income taxes 199,151 0 199,151
Income taxes 251,163 $863 252,026
Rate deferrals:
Rate deferrals (1,651) 0 (1,651)
Amortization of rate deferrals 289,259 0 289,259
---------- ------ ----------
Total 3,491,996 863 3,492,859
---------- ------ ----------
Operating Income 993,341 (863) 992,478
---------- ------ ----------
Other Income:
Allowance for equity funds
used during construction 8,049 0 8,049
Miscellaneous - net 60,068 0 60,068
Income taxes - (debit) (33,640) 0 (33,640)
---------- ------ ----------
Total 34,477 0 34,477
---------- ------ ----------
Interest and Other Charges:
Interest on long-term debt 488,799 (2,200) 486,599
Other interest - net 29,849 0 29,849
Allowance for borrowed funds
used during construction (5,478) 0 (5,478)
Preferred dividend requirements
of subsidiaries 56,559 0 56,559
---------- ------ ----------
Total 569,729 (2,200) 567,529
---------- ------ ----------
Income before Cumulative Effect of
a Change in Accounting Principle 458,089 1,337 459,426
Cumulative Effect to January 1, 1993,
of Accruing Unbilled Revenues
(net of income taxes of $57,188) 93,841 0 93,841
---------- ------ ----------
Net Income $551,930 $1,337 $553,267
========== ====== ==========
Average number of common shares outstanding 174,887,556 174,887,556
Earnings per average common share
before cumulative effect of a change
in accounting principle $2.62 $2.63
Earnings per average common share $3.16 $3.16
Dividends declared per common share $1.65 $1.65
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION AND SUBSIDIARIES
Pro Forma Consolidated Statement of Retained Earnings
For the Year Ended December 31, 1993
(Unaudited)
Adjustments To Reflect
Transactions Proposed
Before In Present After
Transaction Filing Transaction
(In thousands)
<S> <C> <C> <C>
Retained Earnings - January 1 $2,062,188 0 $2,062,188
Add - Net Income 551,930 $1,337 553,267
---------- ------ ----------
Total 2,614,118 1,337 2,615,455
---------- ------ ----------
Deduct:
Dividends declared on common stock 288,342 0 288,342
Common stock retirements 13,906 0 13,906
Capital stock and other expenses 1,788 0 1,788
---------- ------ ----------
Total 304,036 0 304,036
---------- ------ ----------
Retained Earnings - December 31 $2,310,082 $1,337 $2,311,419
========== ====== ==========
</TABLE>
