______________________________________________________________________
_________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the Fiscal Year Ended December 31, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________ to __________
Commission Registrant, State of Incorporation, IRS Employer
File Number Address of Principal Executive Identification No.
Offices and Telephone Number
1-11299 ENTERGY CORPORATION 72-1229752
(a Delaware corporation)
639 Loyola Avenue
New Orleans, Louisiana 70113
Telephone (504) 529-5262
1-10764 ARKANSAS POWER & LIGHT COMPANY 71-0005900
(an Arkansas corporation)
425 West Capitol Avenue, 40th Floor
Little Rock, Arkansas 72201
Telephone (501) 377-4000
1-2703 GULF STATES UTILITIES COMPANY 74-0662730
(a Texas corporation)
350 Pine Street
Beaumont, Texas 77701
Telephone (409) 838-6631
1-8474 LOUISIANA POWER & LIGHT COMPANY 72-0245590
(a Louisiana corporation)
639 Loyola Avenue
New Orleans, Louisiana 70113
Telephone (504) 529-5262
0-320 MISSISSIPPI POWER & LIGHT COMPANY 64-0205830
(a Mississippi corporation)
308 East Pearl Street
Jackson, Mississippi 39201
Telephone (601) 368-5000
0-5807 NEW ORLEANS PUBLIC SERVICE INC. 72-0273040
(a Louisiana corporation)
639 Loyola Avenue
New Orleans, Louisiana 70113
Telephone (504) 529-5262
1-9067 SYSTEM ENERGY RESOURCES, INC. 72-0752777
(an Arkansas corporation)
Echelon One
1340 Echelon Parkway
Jackson, Mississippi 39213
Telephone (601) 368-5000
<PAGE>
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Registrant Title of Class on Which Registered
- - - - ------------ ---------------- -------------------
Entergy Corporation Common Stock, $0.01 Par Value New York Stock
- 227,770,617 Exchange, Inc.
Shares outstanding at Chicago Stock
February 29, 1996 Exchange
Incorporated
Pacific Stock
Exchange
Incorporated
Arkansas Power & Light $2.40 Preferred Stock, New York Stock
Company Cumulative, $0.01 Par Exchange, Inc.
Value ($25 Involuntary
Liquidation Value)
Gulf States Utilities Preferred Stock, Cumulative,
Company $100 Par Value:
$4.40 Dividend Series New York Stock
Exchange, Inc.
$4.52 Dividend Series New York Stock
Exchange, Inc.
$5.08 Dividend Series New York Stock
Exchange, Inc.
$8.80 Dividend Series New York Stock
Exchange, Inc.
Adjustable Rate Series B New York Stock
(Depository Receipts) Exchange, Inc.
Preference Stock, Cumulative, New York Stock
without Par Value Exchange, Inc.
$1.75 Dividend Series
Louisiana Power & 9.68% Preferred Stock, New York Stock
Light Company Cumulative, $25 Par Exchange, Inc.
Value
12.64% Preferred Stock, New York Stock
Cumulative, $25 Par Exchange, Inc.
Value
Securities registered pursuant to Section 12(g) of the Act:
Registrant Title of Class
- - - - ----------- --------------------
Arkansas Power & Light Preferred Stock, Cumulative, $100
Company Par Value
Preferred Stock, Cumulative, $25
Par Value
Preferred Stock, Cumulative,
$0.01 Par Value
Gulf States Utilities Preferred Stock, Cumulative, $100
Company Par Value
Louisiana Power & Light Preferred Stock, Cumulative, $100
Company Par Value
Preferred Stock, Cumulative, $25
Par Value
Mississippi Power & Preferred Stock, Cumulative, $100
Light Company Par Value
New Orleans Public Preferred Stock, Cumulative, $100
Service Inc. Par Value
<PAGE>
Indicate by check mark whether the registrants (1) have filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrants were required to file such
reports), and (2) have been subject to such filing requirements for
the past 90 days. Yes X No ____
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of the registrants' knowledge, in
definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. X
The aggregate market value of Entergy Corporation Common Stock,
$0.01 Par Value, held by non affiliates, was $6.5 billion based
on the reported last sale price of such stock on the New York Stock
Exchange on February 29, 1996. Entergy Corporation is the sole holder
of the common stock of Arkansas Power & Light Company, Gulf States
Utilities Company, Louisiana Power & Light Company, Mississippi Power
& Light Company, New Orleans Public Service Inc., and System Energy
Resources, Inc.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement of Entergy Corporation to be
filed in connection with its Annual Meeting of Stockholders, to be
held May 2, 1996, are incorporated by reference into Part III hereof.
<PAGE>
TABLE OF CONTENTS
Page
Number
------
Definitions i
Part I
Item 1. Business 1
Item 2 Properties 40
Item 3. Legal Proceedings 40
Item 4. Submission of Matters to a Vote of Security
Holders 40
Part II
Item 5. Market for Registrants' Common Equity and
Related Stockholder Matters 40
Item 6. Selected Financial Data 41
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 41
Item 8. Financial Statements and Supplementary Data 42
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 184
Part III
Item 10. Directors and Executive Officers of the
Registrants 184
Item 11. Executive Compensation 194
Item 12. Security Ownership of Certain Beneficial
Owners and Management 200
Item 13. Certain Relationships and Related
Transactions 204
Part IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K 205
Experts 206
Signatures 207
Consents of Experts 214
Report of Independent Accountants on Financial Statement Schedules218
Independent Auditors' Report on Financial Statement Schedules 219
Index to Financial Statement Schedules S-1
Exhibit Index E-1
This combined Form 10-K is separately filed by Entergy Corporation,
Arkansas Power & Light Company, Gulf States Utilities Company,
Louisiana Power & Light Company, Mississippi Power & Light Company,
New Orleans Public Service Inc., and System Energy Resources, Inc.
Information contained herein relating to any individual company is
filed by such company on its own behalf. None of these companies make
any representations as to information relating to the other companies.
This report (including the material incorporated herein by reference)
should be read in its entirety. No one section of the report deals
with all aspects of the subject matter.
<PAGE>
DEFINITIONS
Certain abbreviations or acronyms used in the text and notes are
defined below:
Abbreviation or Acronym Term
- - - - ----------------------- ----
AFUDC Allowance for Funds Used During
Construction
Algiers 15th Ward of the City of New Orleans,
Louisiana
ALJ Administrative Law Judge
ANO Arkansas Nuclear One Steam Electric
Generating Station (nuclear), owned by AP&L
ANO 1 Unit No. 1 of ANO
ANO 2 Unit No. 2 of ANO
AP&L Arkansas Power & Light Company
APSC Arkansas Public Service Commission
Arkansas District Court United States District Court for the Western
District of Arkansas
Availability Agreement Agreement, dated as of June 21, 1974, as
amended, among System Energy and AP&L, LP&L,
MP&L, and NOPSI, and the assignments thereof
Cajun Cajun Electric Power Cooperative, Inc.
Capital Funds Agreement Agreement, dated as of June 21, 1974, as
amended, between System Energy and Entergy
Corporation, and the assignments thereof
CitiPower CitiPower Ltd.
City of New Orleans
or City New Orleans, Louisiana
Council Council of the City of New Orleans,
Louisiana
D.C. Circuit United States Court of Appeals for the
District of Columbia Circuit
DOE United States Department of Energy
Eighth Circuit United States Court of Appeals for the
Eighth Circuit
EPAct Energy Policy Act of 1992
Entergy Entergy Corporation and its various
direct and indirect subsidiaries
Entergy Corporation Entergy Corporation, a Delaware corporation,
successor to Entergy Corporation, a Florida
corporation
<PAGE>
DEFINITIONS (Continued)
Abbreviation or Acronym Term
- - - - ----------------------- ----
Entergy Enterprises Entergy Enterprises, Inc.
Entergy Operations Entergy Operations, Inc.
Entergy Power Entergy Power, Inc.
Entergy Services Entergy Services, Inc.
EPA Environmental Protection Agency
EWG Exempt Wholesale Generator
FASB Financial Accounting Standards Board
FERC Federal Energy Regulatory Commission
Fifth Circuit United States Court of Appeals for the Fifth
Circuit
G&R General and Refunding
Grand Gulf Grand Gulf Steam Electric Generating Station
(nuclear), owned 90% by System Energy
Grand Gulf 1 Unit No. 1 of Grand Gulf
Grand Gulf 2 Unit No. 2 of Grand Gulf
GSU Gulf States Utilities Company (including
wholly owned subsidiaries - Varibus
Corporation, GSG&T, Inc., Prudential Oil &
Gas, Inc., and Southern Gulf Railway
Company)
Independence Independence Steam Electric Generating
Station (coal), owned 16% by AP&L, 25% by
MP&L, and 16% by Entergy Power
Independence 2 Unit No. 2 of the Independence Station,
owned 25% by MP&L and 31.5% by
Entergy Power
IRS Internal Revenue Service
KWh Kilowatt-Hour(s)
LP&L Louisiana Power & Light Company
LPSC Louisiana Public Service Commission
MCF 1,000 cubic feet of gas
<PAGE>
DEFINITIONS (Continued)
Abbreviation or Acronym Term
- - - - ----------------------- ----
Merger The combination transaction, consummated
on December 31, 1993, by which GSU became a
subsidiary of Entergy Corporation and
Entergy Corporation became a Delaware
corporation
MP&L Mississippi Power & Light Company
MPSC Mississippi Public Service Commission
MW Megawatt(s)
Nelson Unit 6 Unit No. 6 (coal) of the Nelson Steam
Electric Generating Station, owned 70% by
GSU
NISCO Nelson Industrial Steam Company
1991 NOPSI Settlement Settlement retroactive to October 4, 1991,
among NOPSI, the Council, and the Alliance
for Affordable Energy, Inc. (local consumer
advocate group), which settled certain Grand
Gulf 1 prudence issues and certain
litigation related to the February 4
Resolution
1994 NOPSI Settlement Settlement effective January 1, 1995,
between NOPSI and the Council in which NOPSI
agreed to implement a permanent reduction in
electric and gas rates and resolve disputes
with the Council in the interpretation of
the 1991 NOPSI Settlement
NOPSI New Orleans Public Service Inc.
NRC Nuclear Regulatory Commission
Operating Companies AP&L, GSU, LP&L, MP&L, and NOPSI,
collectively
PRP Potentially Responsible Party (a person
or entity that may be responsible for
remediation of environmental contamination)
PUCT Public Utility Commission of Texas
PUHCA Public Utility Holding Company Act of 1935,
as amended
PURPA Public Utility Regulatory Policies Act
Rate Cap The level of GSU's retail electric base
rates in effect at December 31, 1993, for
the Louisiana retail jurisdiction, and the
level of such rates in effect prior to the
settlement agreement with the PUCT on July
21, 1994, for the Texas retail jurisdiction,
which may not be exceeded before December
31, 1998
<PAGE>
DEFINITIONS (Concluded)
Abbreviation or Acronym Term
- - - - ----------------------- ----
Reallocation Agreement 1981 Agreement, superseded in part by a
June 13, 1985 decision of FERC, among AP&L,
LP&L, MP&L, NOPSI, and System Energy
relating to the sale of capacity and energy
from Grand Gulf
Ritchie 2 Unit No. 2 of the R. E. Ritchie Steam
Electric Generating Station (gas/oil)
River Bend River Bend Steam Electric Generating Station
(nuclear), owned 70% by GSU
RUS Rural Utility Services (formerly the
Rural Electrification Administration or
"REA")
SEC Securities and Exchange Commission
SFAS Statement of Financial Accounting
Standards, promulgated by the Financial
Accounting Standards Board
SMEPA South Mississippi Electric Power Agency
System Entergy Corporation and its various direct
and indirect subsidiaries
System Agreement Agreement, effective January 1, 1983, as
modified, among the Operating Companies
relating to the sharing of generating
capacity and other power resources
System Energy System Energy Resources, Inc.
System Fuels System Fuels, Inc.
Unit Power Sales Agreement Agreement, dated as of June 10, 1982,
as amended and approved by FERC, among AP&L,
LP&L, MP&L, NOPSI, and System Energy,
relating to the sale of capacity and energy
from System Energy's share of Grand Gulf 1
Waterford 3 Unit No. 3 (nuclear) of the Waterford Steam
Electric Generating Station, owned 90.7% by
LP&L. The remaining 9.3% undivided interest
is leased by LP&L
<PAGE>
PART I
Item 1. Business
BUSINESS OF ENTERGY
General
Entergy Corporation was originally incorporated under the laws of
the State of Florida on May 27, 1949. On December 31, 1993, Entergy
Corporation merged with and into Entergy-GSU Holdings, Inc., a Delaware
corporation, which then changed its name to Entergy Corporation.
Entergy Corporation is a public utility holding company registered
under PUHCA and does not own or operate any significant assets other
than the stock of its subsidiaries. Entergy Corporation owns all of
the outstanding common stock of five domestic retail operating electric
utility subsidiaries, AP&L, GSU, LP&L, MP&L, and NOPSI. AP&L was
incorporated under the laws of the State of Arkansas in 1926; GSU was
incorporated under the laws of the State of Texas in 1925; LP&L and
NOPSI were incorporated under the laws of the State of Louisiana in
1974 and 1926, respectively; and MP&L was incorporated under the laws
of the State of Mississippi in 1963. As of December 31, 1995, the
Operating Companies provided electric service to approximately
2.4 million customers in the States of Arkansas, Louisiana,
Mississippi, Tennessee, and Texas. In addition, GSU furnishes natural
gas utility service in the Baton Rouge, Louisiana area, and NOPSI
furnishes natural gas utility service in the New Orleans, Louisiana
area. GSU produces and sells, on a nonregulated basis, process steam
and by-product electricity supplied from its steam electric extraction
plant to a large industrial customer. The business of the Operating
Companies is subject to seasonal fluctuations with the peak period
occurring during the third quarter. During 1995, the System's electric
sales as a percentage of total System electric sales were: residential
- - - - - 26.8%; commercial - 20%; and industrial - 40.8%. Electric revenues
from these sectors as a percentage of total System electric revenues
were: 35.6% - residential; 24.4% - commercial; and 29.6% - industrial.
Sales to governmental and municipal sectors and to nonaffiliated
utilities accounted for the balance of energy sales. The System's
major industrial customers are in the chemical processing, petroleum
refining, paper products, and food products industries.
Entergy Corporation also owns directly all of the outstanding
common stock of the following subsidiary companies: System Energy,
Entergy Services, Entergy Operations, Entergy Power, Entergy
Enterprises, Entergy S.A., Entergy Argentina S.A., Entergy Argentina
S.A., Ltd., Entergy Power Development Corporation, Entergy Transener
S.A., Entergy Power Marketing Corporation, Entergy Power Development
International Holdings, Inc., and Entergy Power Development
International Corporation. System Energy is a nuclear generating
company that was incorporated under the laws of the State of Arkansas
in 1974. System Energy sells at wholesale the capacity and energy from
its 90% interest in Grand Gulf 1 to its only customers, AP&L, LP&L,
MP&L, and NOPSI (see "CAPITAL REQUIREMENTS AND FUTURE FINANCING -
Certain System Financial and Support Agreements - Unit Power Sales
Agreement," below). System Energy has approximately a 78.5% ownership
interest and an 11.5% leasehold interest in Grand Gulf 1. Entergy
Services, a Delaware corporation, provides general executive, advisory,
administrative, accounting, legal, engineering, and other services to
the Operating Companies, generally at cost. Entergy Operations, a
Delaware corporation, is a nuclear management company that operates
ANO, River Bend, Waterford 3, and Grand Gulf 1, subject to the owner
oversight of AP&L, GSU, LP&L, and System Energy, respectively. Entergy
Power, a Delaware corporation, is an independent power producer that
owns 809 MW of generating capacity and markets its capacity and energy
in the wholesale market and in other markets not otherwise presently
served by the System. (For further information on regulatory
proceedings related to Entergy Power, see "RATE MATTERS AND REGULATION
- - - - - Rate Matters - Wholesale Rate Matters - Entergy Power," below).
Entergy Enterprises is a nonutility company incorporated under Delaware
law that invests in and develops energy-related projects and other
businesses that are or may be of benefit to the System's utility
business (see "Domestic and Foreign Energy-Related Investments,"
below). Entergy Enterprises also markets outside the System technical
expertise, products, and services developed by the Operating Companies
that have commercial value beyond their use in the System's operations
and provides services to certain nonutility companies in the System.
Entergy Corporation also has subsidiaries that participate in utility
projects located outside the System's retail service territory, both
domestically and internationally. See "Domestic and Foreign Energy-
Related Investments" and "CitiPower Acquisition," below) for a
discussion of these subsidiaries.
AP&L, LP&L, MP&L, and NOPSI own 35%, 33%, 19%, and 13%,
respectively, of all the common stock of System Fuels, a non-profit
subsidiary incorporated in Louisiana that implements and/or maintains
certain programs to procure, deliver, and store fuel supplies for the
Operating Companies.
GSU has four wholly owned subsidiaries: Varibus Corporation,
GSG&T, Inc., Southern Gulf Railway Company, and Prudential Oil & Gas,
Inc. Varibus Corporation operates intrastate gas pipelines in
Louisiana, which are used primarily to transport fuel to two of GSU's
generating stations. GSG&T, Inc. owns the Lewis Creek Station, a gas-
fired generating plant, which is leased to and operated by GSU.
Southern Gulf Railway Company owns and will operate several miles of
rail track being constructed in Louisiana for the purpose of
transporting coal for use as a boiler fuel at Nelson Unit 6.
Prudential Oil & Gas, Inc., which was formerly in the business of
exploring, developing, and operating oil and gas properties in Texas
and Louisiana, is presently inactive.
Entergy Corporation-GSU Merger
On December 31, 1993, GSU became a wholly owned subsidiary of
Entergy Corporation. As consideration to GSU's shareholders, Entergy
Corporation paid $250 million in cash and issued 56,695,724 shares of
its common stock, based upon a valuation of $35.8417 per share, in
exchange for outstanding shares of GSU common stock.
Unless otherwise noted, consolidated financial position and
statistical information contained in this report for the years ended
December 31, 1995, 1994, and 1993 (such as assets, liabilities, and
property) includes the associated GSU amounts. Consolidated financial
results and statistical information (such as revenues, sales, and
expenses) for the years ended December 31, 1995 and 1994 includes such
GSU amounts, while periods ending before January 1, 1994, do not
include GSU amounts; those amounts are presented separately for GSU in
this report.
Certain Industry and System Challenges
The System's business is affected by various challenges and
issues, many of which confront the electric utility industry generally.
These issues and challenges include:
- responding to an increasingly competitive environment
(see "MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
SIGNIFICANT FACTORS AND KNOWN TRENDS");
- addressing current and proposed structural changes in
the electric utility industry and changes in the regulation of
generation and transmission of electricity (see "MANAGEMENT'S
FINANCIAL DISCUSSION AND ANALYSIS - SIGNIFICANT FACTORS AND
KNOWN TRENDS");
- achieving cost savings anticipated with the Merger;
- complying with regulatory requirements with respect to
nuclear operations (see "RATE MATTERS AND REGULATION -
Regulation - Regulation of the Nuclear Power Industry," below)
and environmental matters (see "RATE MATTERS AND REGULATION -
Regulation - Environmental Regulation," below);
- resolving GSU's major contingencies, including potential
write-offs and refunds related to River Bend (see "RATE
MATTERS AND REGULATION - Rate Matters - Retail Rate Matters -
GSU," below), litigation with Cajun relating to its ownership
interest in River Bend, and Cajun's bankruptcy proceedings
(see "RATE MATTERS AND REGULATION - Regulation - Other
Regulation and Litigation - Cajun - River Bend Litigation,"
below); and
- implementing a new accounting standard that describes
the circumstances in which assets are determined to be
impaired, which may eventually be applied to "stranded costs"
(costs not recoverable from those customers for whose benefit
the costs were incurred) resulting from increased competition
(see "MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
SIGNIFICANT FACTORS AND KNOWN TRENDS,");
- achieving high levels of operating efficiencies, cost
control, and returns on investments in Entergy Corporation's
growing portfolio of non utility and overseas business
ventures (see "Domestic and Foreign Energy-Related
Investments" and "CitiPower Acquisition," below).
Domestic and Foreign Energy-Related Investments
Entergy Corporation seeks opportunities to expand its energy-
related businesses that are not regulated by state and local regulatory
authorities (nonregulated businesses). These nonregulated businesses
currently include power development and new technology related to the
utility business. Entergy Corporation's strategy is to identify and
pursue nonregulated business opportunities that have the potential to
earn a greater return than its regulated utility operations. Entergy
Corporation has expanded its investments in nonregulated business
opportunities overseas as well as in the United States. Through the
end of 1995, Entergy Corporation had participated in foreign non-
regulated electric ventures in Pakistan, Argentina, and Peru. As of
December 31, 1995, Entergy Corporation had invested $555.5 million in
equity capital (reduced by accumulated losses of $169 million) in
nonregulated businesses. See the discussion below of Entergy
Corporation's acquisition of CitiPower on January 5, 1996.
During 1995, Entergy Corporation's nonregulated businesses
activities included the following:
(1) Entergy Power's $246.7 million debt obligation to
Entergy Corporation was converted into equity in April 1995.
Entergy Power sells capacity and energy from its 100% and 31.5%
interest in Ritchie 2 and Independence 2, respectively. Entergy
Power purchased an interest in these plants from AP&L in 1990.
Entergy Corporation originally financed Entergy Power principally
with a loan to Entergy Power. Entergy Power was formed to compete
with other utilities and independent power producers in the bulk
power market.
(2) In April 1995, Entergy Systems and Service, Inc.
(Entergy SASI) and Systems and Service International, Inc. (SASI),
amended their existing distribution agreement. As a result,
Entergy SASI liquidated its equity interest in SASI. Previously,
Entergy SASI, a subsidiary of Entergy Enterprises, held a 9.95%
equity interest in SASI, a manufacturer of efficient lighting
products. Entergy SASI distributes such products purchased under
a distribution agreement with SASI, in conjunction with providing
various energy management services to its customers. The amended
distribution agreement discussed above provided for a reduction in
SASI's profit margin on its sale of products to Entergy SASI and
transferred the rights to certain of SASI's energy efficient
technologies to Entergy SASI. In exchange, among other things,
Entergy SASI transferred to SASI all of its equity ownership in
SASI.
(3) In June 1995, Entergy Corporation contributed $125
million in equity capital to Entergy SASI through Entergy
Enterprises, Inc., thus allowing Entergy SASI to retire its debt
obligation to Entergy Corporation. Entergy Corporation had
previously provided loans to Entergy SASI to fund Entergy SASI's
business expansion.
(4) As of December 31, 1995, Entergy Enterprises wrote down
its equity interest in First Pacific Networks (FPN), a
communications company, by $9.3 million to reflect what management
believes is a permanent decline in market value. Entergy
Enterprises holds a 7.9% equity interest in FPN. The total cost
of Entergy Enterprises' investment in FPN as of December 31, 1995,
was approximately $1.2 million.
(5) In June 1995, Entergy Corporation received SEC
authorization to invest up to $350 million through December 31,
1997, in Entergy Enterprises. Such investments may take the form
of purchases of common stock, capital contributions, loans, and/or
guarantees of indebtedness or other obligations of Entergy
Enterprises or certain of its affiliated companies. In January
1995 Entergy Corporation guaranteed $65 million of EP Edegel, Inc.,
a subsidiary of Entergy Corporation, obligations.
(6) In 1995, Entergy Corporation has requested
approval from the SEC to form a new nonregulated
subsidiary named Entergy Technologies Company (ETC). ETC would
offer bulk interstate telecommunications service to
telecommunications carriers which in turn would market that
service to third parties. The recently enacted Telecommunications
Reform Act of 1996 permits Entergy to market such a service,
pending state and local regulatory approval. See MANAGEMENT'S
FINANCIAL DISCUSSION AND ANALYSIS - SIGNIFICANT FACTORS AND KNOWN
TRENDS for a discussion of the Telecommunications Act of 1996 and
its impact on Entergy.
(7) During the third quarter of 1995, Entergy Corporation's
subsidiary, Entergy S.A., purchased 3.9% of the outstanding stock
of the Central Buenos Aires Project (CBA Project) for $1.7
million. Entergy S.A., owns a 10% interest in a consortium with
other nonaffiliated companies that acquired a 60% interest in
Central Costanera, S.A. (Costanera), a steam electric generating
facility located in Argentina. Through Entergy S.A.'s interest in
Costanera, Entergy S.A. indirectly purchased an additional 3% of
the outstanding stock of the CBA Project. In October 1995,
Entergy Power Holding Limited, a wholly owned subsidiary of
Entergy Corporation, purchased Entergy S.A.'s interest in the CBA
Project and purchased an additional 3.9% of the outstanding stock
of the CBA Project for $1.9 million. The CBA Project includes the
addition of a 220 MW combustion turbine and heat recovery boiler
to a generating unit at the Costanera steam electric generating
facility. This addition will provide electricity to the Argentina
transmission grid and steam to the Costanera generating unit. The
open cycle portion of the CBA Project, providing electricity to
the Argentina grid, was placed into operation at the end of
October 1995. The steam recovery portion, which will provide
steam to the Costanera generating unit, is expected to be in
operation in October 1996.
(8) On November 30, 1995, Entergy Corporation's subsidiary,
Entergy Power Development Corporation, purchased through a
consortium 20.8% of Edegel, S.A. for $100 million in equity and
$65 million of debt guaranteed by Entergy Corporation. Edegel
S.A. is a privatization project in Lima, Peru consisting of 5
hydroelectric generation stations (totaling 539 MW) and one
thermal station (154 MW) supporting 345 miles of transmission
lines. An additional 100 MW of thermal load capacity is required
to be installed within one year. The additional plant is expected
to be financed by Edegel S.A.
(9) In early October 1995, FERC issued an order granting
exempt wholesale generator status to Entergy Power Marketing
Corporation (EPM), a wholly owned subsidiary of Entergy
Corporation. EPM was created during 1995 to become a buyer and
seller of electrical energy and its generating fuels. In
February 1996, FERC approved market-based rate sales of
electricity by EPM. Such approval will allow EPM to begin
providing wholesale customers with a variety of products
including physical and financial trading. Pending approval from
the SEC, EPM expects to begin financial trading by the summer of
1996.
Entergy Corporation's net investment in nonregulated subsidiaries,
reduced by accumulated losses, as of December 31, 1995 and 1994, is as
follows:
Net Investment
Nonregulated Subsidiary 1995* 1994
----------------------- --------- --------
(In Millions)
Entergy Power Development $ 180.6 $ 80.8
Corporation
Entergy Power, Inc. 173.1 154.4
Entergy Enterprises, Inc. 112.0 22.2
Entergy Argentina S.A., Ltd. 42.0 41.1
Entergy Transener 19.0 22.7
Entergy Argentina 17.4 17.1
Entergy S.A. 11.4 13.3
-------- --------
Total $ 555.5 $351.6
======== =======
* Excludes Entergy Corporation's equity investment in CitiPower
completed on January 5, 1996. See "CitiPower Acquisition" below.
In 1995, Entergy Corporation's nonregulated investments reduced
consolidated net income by approximately $64.8 million. In the near
term, these investments are unlikely to have a positive effect on
Entergy Corporation's earnings, but management believes that these
investments will contribute to future earnings growth. Certain of
these investments may involve a higher degree of risk than domestic
regulated utility enterprises.
International operations are subject to the risks inherent in
conducting business abroad, including possible nationalization or
expropriation, price and currency exchange controls, limitations on
foreign participation in local energy-related enterprises, and other
restrictions. Changes in the relative value of currencies occur from
time to time and their effects may be favorable or unfavorable on
results of operations. In addition, there are exchange control
restrictions in certain countries relating to repatriation of earnings.
CitiPower Acquisition
On January 5, 1996, Entergy Corporation finalized its acquisition
of CitiPower, an electric distribution company serving Melbourne,
Australia, and surrounding suburbs. The purchase price of CitiPower
was approximately $1.2 billion, of which $294 million represented an
equity investment by Entergy Corporation, and the remainder represented
debt. Entergy Corporation funded the majority of the equity portion of
the investment by using $230 million of its $300 million line of
credit. CitiPower serves approximately 234,500 customers, the majority
of which are commercial customers. At the time of the acquisition,
CitiPower had 846 employees.
Selected Data
Selected domestic customer and sales data for 1995 are summarized
in the following tables:
<TABLE>
<CAPTION>
Customers as of
December 31, 1995
-------------------
Area Served Electric Gas
-------------- --------- -------
<S> <C> <C>
AP&L Portions of Arkansas and 607,916 -
Tennessee
GSU Portions of Texas and Louisiana 623,147 89,848
LP&L Portions of Louisiana 612,124 -
MP&L Portions of Mississippi 366,298 -
NOPSI City of New Orleans, except
Algiers, which
is provided electric service 190,332 153,370
by LP&L
----------- ----------
System 2,399,817 243,218
=========== ==========
</TABLE>
1995 - Selected Electric Energy Sales Data
<TABLE>
<CAPTION>
System Entergy
AP&L GSU LP&L MP&L NOPSI Energy System
------ ------ ------ ------ ----- ------- -------
(Millions of KWh)
<S> <C> <C> <C> <C> <C> <C> <C>
Electric Department:
Sales to retail 16,692 29,622 30,051 10,981 5,648 - 92,994
customers
Sales for resale:
- Affiliates 8,386 2,935 44 959 149 7,212 -
- Others 5,066 2,212 1,293 692 297 - 10,471
-------- -------- ------- ------- ------ ------- --------
Total 30,144 34,769 31,388 12,632 6,094 7,212 103,465
Steam Department:
- Sales to steam
products - 1,742 - - - - 1,742
customer
-------- -------- ------- ------- ------ ------- --------
TOTAL 30,144 36,511 31,388 12,632 6,094 7,212 105,207
======== ======== ======= ======= ====== ======= ========
Average use per
residential
customer (KWh) 11,324 14,475 14,623 13,400 11,941 - 13,353
======== ======== ======= ======= ====== ======= ========
</TABLE>
NOPSI sold 16,782,805 MCF of natural gas to retail customers in
1995. Revenues from natural gas operations for each of the three years
in the period ended December 31, 1995, were material for NOPSI, but not
material for the System (see "INDUSTRY SEGMENTS" below for a
description of NOPSI's business segments).
GSU sold 6,476,496 MCF of natural gas to retail customers in 1995.
Revenues from natural gas operations for each of the three years in the
period ended December 31, 1995, were not material for GSU.
See "ENTERGY CORPORATION AND SUBSIDIARIES SELECTED FINANCIAL DATA
- - - - - FIVE-YEAR COMPARISON," and "SELECTED FINANCIAL DATA - FIVE-YEAR
COMPARISON OF AP&L, GSU, LP&L, MP&L, NOPSI, and SYSTEM ENERGY," (which
follow each company's financial statements in this report) for further
information with respect to operating statistics.
Employees
As of December 31, 1995, Entergy had 13,521 employees as follows:
Full-time:
Entergy Corporation -
AP&L 1,647
GSU 1,833
LP&L 1,082
MP&L 892
NOPSI 489
System Energy -
Entergy Operations 4,102
Entergy Services 2,529
Other Subsidiaries 869
------
Total Full-time 13,443
Part-time 78
------
Total Entergy System 13,521
======
Competition
Refer to "MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
SIGNIFICANT FACTORS AND KNOWN TRENDS" for a detailed discussion of
competitive challenges Entergy faces in the utility industry.
CAPITAL REQUIREMENTS AND FUTURE FINANCING
Construction expenditures by company (including environmental
expenditures, which are immaterial, and AFUDC, but excluding nuclear
fuel) for the period 1996-1998 are estimated as follows:
<TABLE>
<CAPTION>
1996 1997 1998 Total
(In Millions)
<S> <C> <C> <C> <C>
AP&L $152 $144 $136 $432
GSU 155 127 131 413
LP&L 125 111 114 350
MP&L 69 68 68 205
NOPSI 22 28 26 76
System Energy 23 20 20 63
ESI 24 12 12 48
Other 1 - - 1
------ ----- ----- -------
System $571 $510 $507 $1,588
====== ===== ===== =======
</TABLE>
No significant construction costs are expected in connection with
the System's generating facilities. Actual construction costs may vary
from these estimates because of a number of factors, including changes
in load growth estimates, changes in environmental regulations,
modifications to nuclear units to meet regulatory requirements,
increasing costs of labor, equipment and materials, and cost of
capital. In addition to construction expenditure requirements, the
System must meet scheduled long-term debt and preferred stock
maturities and cash sinking fund requirements. See Notes 4, 5, and 6
to the financial statements for further capital requirements and
financing information.
Entergy Corporation's primary capital requirements are to invest
periodically in, or make loans to, its subsidiaries and to invest in
new energy-related enterprises. See "MANAGEMENT'S FINANCIAL DISCUSSION
AND ANALYSIS - LIQUIDITY AND CAPITAL RESOURCES," for additional
discussion of Entergy Corporation's current and future planned
investments in its subsidiaries and financial sources for such
investments. One source of funds for Entergy is dividend distributions
from its subsidiaries. Certain events could limit the amount of these
distributions. Such events include River Bend rate appeals and pending
litigation with Cajun. Substantial write-offs or charges resulting
from adverse rulings in these matters could adversely affect GSU's
ability to continue to pay dividends. See Notes 2 and 8 to the
financial statements regarding River Bend rate appeals and pending
litigation with Cajun.
Certain System Financial and Support Agreements
Unit Power Sales Agreement (AP&L, LP&L, MP&L, NOPSI, and System
Energy)
The Unit Power Sales Agreement allocates capacity and energy from
System Energy's 90% ownership and leasehold interests in Grand Gulf 1
(and the related costs) to AP&L (36%), LP&L (14%), MP&L (33%), and
NOPSI (17%). AP&L, LP&L, MP&L, and NOPSI make payments to System
Energy for their respective entitlements of capacity and energy on a
full cost-of-service basis regardless of the quantity of energy
delivered, so long as Grand Gulf 1 remains in commercial operation.
Payments under the Unit Power Sales Agreement are System Energy's only
source of operating revenues. The financial condition of System Energy
depends upon the continued commercial operation of Grand Gulf 1 and the
receipt of payments from AP&L, LP&L, MP&L, and NOPSI. Payments made by
AP&L, LP&L, MP&L, and NOPSI under the Unit Power Sales Agreement are
generally recovered through rates. In the case of AP&L and LP&L,
payments are also recovered through sales of electricity from their
respective retained shares of Grand Gulf 1. See Note 1 to the
financial statements for further information regarding retained shares.
Availability Agreement (AP&L, LP&L, MP&L, NOPSI, and System Energy)
The Availability Agreement among System Energy and AP&L, LP&L,
MP&L, and NOPSI was entered into in 1974 in connection with the
financing by System Energy of Grand Gulf. The agreement provided that
System Energy would join in the agreement among AP&L, LP&L, MP&L, and
NOPSI for the sharing of generating capacity and other capacity and
energy resources on or before the date on which Grand Gulf 1 was placed
in commercial operation. It also provided that System Energy would
make available to AP&L, LP&L, MP&L, and NOPSI all capacity and energy
available from System Energy's share of Grand Gulf.
AP&L, LP&L, MP&L, and NOPSI also agreed severally to pay System
Energy monthly for the right to receive capacity and energy available
from Grand Gulf in amounts that (when added to any amounts received by
System Energy under the Unit Power Sales Agreement, or otherwise) would
at least equal System Energy's total operating expenses for Grand Gulf
(including depreciation at a specified rate) and interest charges.
As amended to date, the Availability Agreement provides that:
- the obligations of AP&L, LP&L, MP&L, and NOPSI for
payments for Grand Gulf 1 become effective upon commercial
operation of Grand Gulf 1 on July 1, 1985;
- the sale of capacity and energy generated by Grand Gulf
may be governed by a separate power purchase agreement among
System Energy and AP&L, LP&L, MP&L, and NOPSI;
- the September 1989 write-off of System Energy's
investment in Grand Gulf 2, amounting to approximately $900
million, will be amortized for Availability Agreement purposes
over 27 years rather than in the month the write-off was
recognized on System Energy's books; and
- the allocation percentages under the Availability
Agreement are fixed as follows: AP&L - 17.1%; LP&L - 26.9%;
MP&L - 31.3%; and NOPSI - 24.7%.
As noted above, the Unit Power Sales Agreement provides for
different allocation percentages for sales of capacity and energy from
Grand Gulf 1. However, the allocation percentages under the
Availability Agreement remain in effect and would govern payments made
under such agreement in the event of a shortfall of funds available to
System Energy from other sources, including payments by AP&L, LP&L,
MP&L, and NOPSI to System Energy under the Unit Power Sales Agreement.
System Energy has assigned its rights to payments and advances
from AP&L, LP&L, MP&L, and NOPSI under the Availability Agreement as
security for its first mortgage bonds and reimbursement obligations to
certain banks providing the letters of credit in connection with the
equity funding of the sale and leaseback transactions described in Note
9 to the financial statements under "Sale and Leaseback Transactions -
Grand Gulf 1 Lease Obligations (System Energy)." In these assignments,
AP&L, LP&L, MP&L, and NOPSI further agreed that, in the event they were
prohibited by governmental action from making payments under the
Availability Agreement (if, for example, FERC reduced or disallowed
such payments as constituting excessive rates), they would then make
subordinated advances to System Energy in the same amounts and at the
same times as the prohibited payments. System Energy would not be
allowed to repay these subordinated advances so long as it remained in
default under the related indebtedness or in other similar
circumstances.
Each of the assignment agreements relating to the Availability
Agreement provides that AP&L, LP&L, MP&L, and NOPSI shall make payments
directly to System Energy. However, if there is an event of default,
AP&L, LP&L, MP&L, and NOPSI must make those payments directly to the
holders of indebtedness that are the beneficiaries of such assignment
agreements. The payments must be made pro rata according to the amount
of the respective obligations secured.
The obligations of AP&L, LP&L, MP&L, and NOPSI to make payments
under the Availability Agreement are subject to the receipt and
continued effectiveness of all necessary regulatory approvals. Sales
of capacity and energy under the Availability Agreement would require
that the Availability Agreement be submitted to FERC for approval with
respect to the terms of such sale. No such filing with FERC has been
made because sales of capacity and energy from Grand Gulf are being
made pursuant to the Unit Power Sales Agreement. Other aspects of the
Availability Agreement, including the obligations of AP&L, LP&L, MP&L,
and NOPSI to make subordinated advances, are subject to the
jurisdiction of the SEC under PUHCA, whose approval has been obtained.
If, for any reason, sales of capacity and energy are made in the future
pursuant to the Availability Agreement, the jurisdictional portions of
the Availability Agreement would be submitted to FERC for approval.
Since commercial operation of Grand Gulf 1 began, payments under
the Unit Power Sales Agreement to System Energy have exceeded the
amounts payable under the Availability Agreement. Accordingly, no
payments under the Availability Agreement by AP&L, LP&L, MP&L, and
NOPSI have ever been required. In the event such payments were
required, the ability of AP&L, LP&L, MP&L, and NOPSI to recover from
their customers amounts paid under the Availability Agreement, or under
the assignments thereof, would depend upon the outcome of rate
proceedings before state and local regulatory authorities. In view of
the controversies that arose over the allocation of capacity and energy
from Grand Gulf 1 pursuant to the Unit Power Sales Agreement,
opposition to full recovery would be likely and the outcome of such
proceedings, should they occur, is not predictable.
Capital Funds Agreement (Entergy Corporation and System Energy)
System Energy and Entergy Corporation have entered into the
Capital Funds Agreement whereby Entergy Corporation has agreed to
supply System Energy with sufficient capital to (1) maintain System
Energy's equity capital at an amount equal to a minimum of 35% of its
total capitalization (excluding short-term debt) and (2) permit the
continued commercial operation of Grand Gulf 1 and pay in full all
indebtedness for borrowed money of System Energy when due under any
circumstances.
Entergy Corporation has entered into various supplements to the
Capital Funds Agreement, and System Energy has assigned its rights
under such supplements as security for its first mortgage bonds and for
reimbursement obligations to certain banks providing letters of credit
in connection with the equity funding of the sale and leaseback
transactions described in Note 9 to the financial statements under
"Sale and Leaseback Transactions - Grand Gulf 1 Lease Obligations
(System Energy)." Each such supplement provides that permitted
indebtedness for borrowed money incurred by System Energy in connection
with the financing of Grand Gulf may be secured by System Energy's
rights under the Capital Funds Agreement on a pro rata basis (except
for the Specific Payments, as defined below). In addition, in the
supplements to the Capital Funds Agreement relating to the specific
indebtedness being secured, Entergy Corporation has agreed to make cash
capital contributions directly to System Energy sufficient to enable
System Energy to make payments when due on such indebtedness (Specific
Payments). However, if there is an event of default, Entergy
Corporation must make those payments directly to the holders of
indebtedness benefiting from the supplemental agreements. The payments
(other than the Specific Payments) must be made pro rata according to
the amount of the respective obligations benefiting from the
supplemental agreements.
RATE MATTERS AND REGULATION
Rate Matters
The Operating Companies' retail rates are regulated by state
and/or local regulatory authorities, as described below. FERC
regulates their wholesale rates (including intrasystem sales pursuant
to the System Agreement) and interstate transmission of electricity, as
well as rates for System Energy's sales of capacity and energy from
Grand Gulf 1 to AP&L, LP&L, MP&L, and NOPSI pursuant to the Unit Power
Sales Agreement.
Wholesale Rate Matters
System Energy
As described above under "Certain System Financial and Support
Agreements," System Energy recovers costs related to its interest in
Grand Gulf 1 through rates charged to AP&L, LP&L, MP&L, and NOPSI for
capacity and energy under the Unit Power Sales Agreement.
On December 12, 1995, System Energy implemented a $65.5 million
rate increase, subject to refund. Refer to Note 2 for a discussion of
the rate increase filed by System Energy with FERC.
Entergy Power
In 1990, authorizations were obtained from the SEC, FERC, the
APSC, and the Public Service Commission of Missouri for Entergy Power
to purchase AP&L's interest in Independence 2 and Ritchie 2, and to
begin marketing the capacity and energy from the units in certain
wholesale markets. The SEC order was appealed to the D.C. Circuit by
various intervenors. The D.C. Circuit reversed a portion of the SEC
order and remanded the case to the SEC for consideration of the effect
of the transfers on the System's future costs of replacement generating
capacity and fuel. On September 9, 1993, the City of New Orleans and
the LPSC each requested a hearing. However, on January 5, 1994, the
City of New Orleans withdrew from the proceeding, pursuant to its
settlement with NOPSI of various issues related to the Merger. In
November 1995, the SEC issued an order in which the SEC reaffirmed its
prior order authorizing the acquisition and formation of Entergy Power
and denying the LPSC's request for a hearing. The November 1995 order
was not appealed, and the statutory period for such an appeal has
expired.
In a related matter, on August 20, l990, the City of New Orleans
filed a complaint against Entergy Corporation, AP&L, LP&L, MP&L, NOPSI,
and System Energy, requesting that FERC investigate AP&L's transfer of
its interest in Independence 2 and Ritchie 2 to Entergy Power and the
effect of the transfer on AP&L, LP&L, MP&L, NOPSI, and their
ratepayers. On October 20, 1995, the D.C. Circuit affirmed FERC's
original orders that the transfer and its effect on current rates was
prudent. However, a determination of the prudency of the transfer on
future replacement costs was deferred until a time when the need for
such replacement capacity occurs.
System Agreement (Energy Corporation, AP&L, GSU, LP&L, MP&L, NOPSI, and
System Energy)
AP&L, GSU, LP&L, MP&L, and NOPSI engage in the coordinated
planning, construction, and operation of generation and transmission
facilities pursuant to the terms of the System Agreement as described
under "PROPERTY - Generating Stations," below.
In connection with the Merger, FERC approved certain rate schedule
changes to integrate GSU into the System Agreement. Certain
commitments were also adopted to assure that the ratepayers of AP&L,
LP&L, MP&L, and NOPSI will not be allocated higher costs. Such
commitments included: (1) a tracking mechanism to protect these
companies from certain unexpected increases in fuel costs; (2) the
exclusion of GSU from the distribution of profits from power sales
contracts entered into prior to the Merger; (3) a methodology to
estimate the cost of capital in future FERC proceedings; and (4) a
stipulation that these companies be insulated from certain direct
effects on capacity equalization payments if GSU should acquire Cajun's
30% share in River Bend. See "Regulation - Other Regulation and
Litigation," for information on appeals of FERC Merger orders and
related pending rate schedule changes.
In the December 15, 1993, order approving the Merger, FERC also
initiated a new proceeding to consider whether the System Agreement
permits certain out-of-service generating units to be included in
reserve equalization calculations under Service Schedule MSS-1 of that
agreement. In connection with this proceeding, the LPSC and the MPSC
submitted testimony seeking retroactive refunds for LP&L and MP&L
(estimated at $22.6 million and $13.2 million, respectively). The FERC
staff subsequently submitted testimony concluding that Entergy's
treatment was reasonable. However, because it concluded that Entergy's
treatment violated the tariff, FERC staff maintained that refunds of
approximately $7.2 million should be ordered. Entergy submitted
testimony on September 23, 1994, describing the potential impacts (not
including interest) on Service Schedule MSS-1 calculations if extended
reserve shutdown units were not included in the MSS-1 calculations
during the period 1987 through 1993. Under such a theory, LP&L and
MP&L would have been overbilled by $10.6 and $8.8 million respectively,
and AP&L and NOPSI would have been underbilled by $6.3 and $13.1
million respectively. The amounts potentially subject to refund will
continue to accrue while the case is pending.
On March 3, 1995, a FERC ALJ issued an opinion holding that the
practice of including the out-of-service units in the reserve
equalization calculations during the period 1987 through 1993 was not
permitted by Service Schedule MSS-1 and, therefore, constituted a
violation of the System Agreement. However, the ALJ found that the
violation was in good faith and had benefited the customers of the
System as a whole. Accordingly, the ALJ recommended that no
retroactive refunds should be ordered. The ALJ also held that the
System Agreement should be amended to allow out-of-service units to be
included in reserve equalization as proposed in an offer of settlement
filed by Entergy on February 16, 1994. The ALJ's opinion is subject to
review by FERC. If FERC concurs with the finding that the System
Agreement was violated, it would have the discretion to order that
refunds be made. If that were to occur, certain Operating Companies
may be required to refund some or all of the amount by which they were
underbilled pursuant to the System Agreement. The Operating Companies
cannot determine at this time whether they would be authorized to
recover through retail rates any amounts associated with refunds that
might be ordered by FERC in this proceeding. The matter remains
pending before FERC.
On March 14, 1995, the LPSC filed a complaint with FERC alleging
that the System Agreement results in unjust and unreasonable rates and
requested that FERC order a hearing on this matter. The LPSC contends
that the failure of the System Agreement to exclude curtailable load
from the determination of an Operating Company's responsibility for
reserve equalization and transmission equalization costs results in an
unjust and unreasonable cost allocation to the Operating Companies that
does not cause these costs to be incurred, and also results in cross-
subsidization among the Operating Companies. Further, the LPSC alleges
that the mechanism by which the Operating Companies purchase energy
under the System Agreement results in unjust and unreasonable rates
because it does not permit Operating Companies that engage in real time
pricing to be charged the marginal cost of the energy generated for the
real time pricing customer. In May 1995, the LPSC amended its original
complaint and Entergy subsequently filed an answer to the LPSC's
amended complaint. The LPSC's amended complaint asserts that the
System Agreement should be revised to exclude curtailable load from the
cost allocation determination due to conflicts with federal policies
under PURPA and with Entergy's system planning philosophy. Entergy's
response asserts that both the provisions under PURPA and the Entergy
system planning philosophy referred to in the LPSC's amended complaint
are applicable only to retail sales.
In June 1995, the APSC filed a complaint with FERC alleging that,
because of changed circumstances, FERC's allocation of nuclear
decommissioning costs in the System is no longer just and reasonable.
The APSC proposes that the System Agreement be amended to provide a new
schedule that would equalize nuclear decommissioning costs according to
load responsibility among the pre-merger operating companies.
Open Access Transmission (Entergy Corporation, AP&L, GSU, LP&L, MP&L,
and NOPSI)
On August 2, 1991, Entergy Services, as agent for AP&L, LP&L,
MP&L, NOPSI, and Entergy Power, submitted to FERC (1) proposed tariffs
that, subject to certain conditions, would provide to electric
utilities "open access" to the System's integrated transmission system,
and (2) rate schedules providing for sales of wholesale power at market-
based rates. FERC approved the filing in August 1992, and various
parties filed appeals with the D.C. Circuit. The case was remanded to
FERC in July 1994 for further proceedings. On October 31, 1994,
Entergy Services as agent for AP&L, GSU, LP&L, MP&L, and NOPSI filed
revised transmission tariffs. On January 6, 1995, FERC issued an order
accepting the tariffs for filing and made them effective, subject to
refund. These tariffs provide both point-to-point and network
transmission service, and are intended to provide "comparability of
service" over the Entergy transmission network. In that order FERC
also ordered that Entergy Power's market pricing authority be
investigated, thereby making Entergy Power's market price rate
schedules subject to refund. An order in the market price rate
investigation is expected to be issued by January 1997. Entergy
expects that no refunds relating to market price rates will be
required.
On March 29, 1995, FERC issued a supplemental notice of proposed
rulemaking (Mega-NOPR) which would require public utilities to provide
non-discriminatory open access transmission service to wholesale
customers, and which would also provide guidance on the recovery of
wholesale and retail stranded costs. Under the proposal, public
utilities would be required to file transmission tariffs for both point-
to-point and network service. Model transmission tariffs were included
in the proposal. With regard to pending proceedings, including
Entergy's tariff proceeding, FERC directed the parties to proceed with
their cases while taking into account FERC's views expressed in the
proposed rule. Hearings relating to Entergy Services' open access
tariffs concluded on February 22, 1996.
In September 1995 and January 1996, Entergy Services filed offers
of partial settlement accepting certain provisions of the transmission
tariffs contained in the Mega-NOPR and resolving certain rate issues.
The remaining rate and tariff issues will be resolved as part of the
FERC's rulemaking in the Mega-NOPR, or after scheduled hearings. In
August 1995, EPM filed an application for permission to make market-
based sales, but subsequently asked that action not be taken on that
request until the open access transmission service proceeding discussed
above is resolved. On December 13, 1995, Entergy Services filed
revised transmission tariffs in a separate proceeding proposing terms
and conditions for open access transmission service that are
substantially identical to the terms and conditions contained in the
Mega-NOPR transmission tariffs with rates to be the same as those
determined in the pending proceeding. On February 14, 1996, FERC
accepted for filing the revised transmission tariffs making rates
subject to the outcome of the pending proceeding and conditionally
accepted EPM's application for market based sales.
Wholesale Contract (AP&L)
In March 1994, North Little Rock, Arkansas awarded to AP&L a
wholesale power contract that will provide estimated revenues of $347
million over 11 years. Under the contract, the price per KWh was
reduced 18% with increases in price through the year 2004. AP&L, which
has been serving North Little Rock for over 40 years, was awarded the
contract after intense bidding with several competitors. On May 22,
1994, FERC accepted the contract. Rehearings were requested by one of
AP&L's competitors. In September 1995, FERC denied the petition for
rehearing.
Retail Rate Matters
General (AP&L, GSU, LP&L, MP&L, and NOPSI)
Certain costs related to Grand Gulf 1, Waterford 3, and River Bend
were phased into retail rates over a period of years in order to avoid
the "rate shock" associated with increasing rates to reflect all such
costs at once. The deferral period in which costs are incurred but not
currently recovered has expired for all of these programs, and AP&L,
GSU, LP&L, MP&L, and NOPSI are now recovering those costs that were
previously deferred.
GSU is involved in several rate proceedings involving, among other
things, recovery of costs associated with River Bend. Some rate relief
has been received, but GSU has been unable to obtain recognition in
rates for a substantial portion of its River Bend investment. Recovery
of certain costs was disallowed while other costs were deferred for
future recovery, held in abeyance pending further regulatory action, or
treated as investments in deregulated assets. Rate proceedings and
appeals relating to these issues are ongoing as discussed in "GSU"
below.
As a means of minimizing the need for retail rate increases, the
System is committed to containing costs to the greatest degree
practicable. In accordance with this retail rate policy, the Operating
Companies have agreed to retail rate caps and/or rate freezes for
specified periods of time.
The retail regulatory philosophy is shifting in some jurisdictions
from traditional cost of service regulation to incentive rate
regulation. System management believes incentive and performance-based
rate plans encourage efficiencies and productivity while permitting
utilities and their customers to share in the resulting benefits. MP&L
implemented an incentive-rate plan in March 1994, and, in June 1995,
LP&L implemented a performance-based formula rate plan. Recognizing
that many industrial customers have energy alternatives, Entergy
continues to work with these customers to address their needs. In
certain cases, competitive prices are negotiated using variable-rate
designs.
Least Cost Integrated Resource Planning (AP&L, GSU, LP&L, MP&L, and
NOPSI)
The System continues to utilize integrated resource planning
(IRP), also known as least cost planning, in order to compete more
effectively in both retail and wholesale markets. IRP is the
development of integrated supply and demand side strategies to meet
future electricity demands reliably, at the lowest possible cost, and
in a more competitive manner.
In 1992, AP&L, LP&L, MP&L, and NOPSI each filed a Least Cost
Integrated Resource Plan (LCIRP) with its respective regulator.
However, in 1994 the System substantially revised its approach to IRP,
and AP&L, LP&L, MP&L, and NOPSI requested that their retail regulators
allow for significant changes in the IRP process. At MP&L's request,
the MPSC dismissed MP&L's LCIRP filing. Due to the increasingly
competitive nature of the electric service market, the System believes
that changes in the IRP process are required. Entergy has adopted a
streamlined process that focuses on minimizing the cost of incremental
resources and maximizing the System's flexibility to adapt its resource
plans to the changing environment in which electric utilities now
operate.
On October 10, 1995, despite Entergy's request, the APSC issued an
order requiring that Arkansas utilities file current integrated
resource plans at least every three years. In this order, the APSC
emphasized that planning processes must continue to evolve and publicly
available information on utility resource plans must be maintained.
The LPSC has established generic hearings to address IRP issues for all
electric utilities within its jurisdiction. These proceedings are
currently ongoing. The Council has suspended the requirement to file
an LCIRP with the Council and has received testimony and held public
hearings regarding the revision of its IRP Ordinance. LP&L and NOPSI
are awaiting an order from the Council that would resolve the matter of
IRP. Currently, the PUCT does not have formal IRP rules in place.
Legislation passed in 1995 requires that the PUCT have IRP rules in
place by September of 1996. This rulemaking process has been initiated
by the PUCT, and GSU is actively participating in this process.
In the fourth quarter of 1995, the System provided to its retail
regulators (the APSC, the Council, the LPSC, the MPSC, and the PUCT) a
new IRP for informational purposes only. The new IRP provides for a
flexible resource strategy to meet the System's additional resource
requirements over the next ten years. The IRP provides for the
utilization of capacity currently in extended reserve shutdown to meet
additional load growth, but also provides the flexibility to rely on
short-term power purchases, upgrades to existing nuclear capacity, or
cogeneration when these resources are more economical.
AP&L
Rate Freeze
In connection with the settlement of various issues related to the
Merger, AP&L agreed that it will not request any general retail rate
increase that would take effect before November 3, 1998, except for
certain instances. See Note 2 for a discussion of the rate freeze as
well as other aspects of the settlement agreement between AP&L and the
APSC.
Recovery of Grand Gulf 1 Costs
Under the settlement agreement entered into with the APSC in 1985
and amended in 1988, AP&L agreed to retain a portion of its Grand Gulf
l-related costs, recover a portion of such costs currently, and defer a
portion of such costs for future recovery. In 1995 and subsequent
years, AP&L retains 22% of its 36% interest in Grand Gulf 1 costs and
recovers the remaining 78%. Deferrals ceased in l990, and AP&L is
recovering a portion of the previously deferred costs each year through
l998. As of December 31, l995, the balance of deferred costs was $360
million. AP&L is permitted to recover on a current basis the
incremental costs of financing the unrecovered deferrals.
AP&L has the right to sell capacity and energy from its retained
share of Grand Gulf 1 to third parties and to sell such energy to its
retail customers at a price equal to AP&L's avoided energy cost.
Proceeds of sales to third parties of AP&L's retained share of Grand
Gulf l capacity and energy accrue to the benefit of AP&L's stockholder.
Fuel Adjustment Clause
AP&L's retail rate schedules include a fuel adjustment clause to
recover the excess cost of fuel and purchased power incurred in the
second prior month. The fuel adjustment clause also contains a nuclear
reserve fund designed to cover the cost of replacement energy during
scheduled maintenance and refueling outages at ANO, and an incentive
provision that permits over- or under-recovery of the excess cost of
replacement energy when ANO is operating or down for reasons other than
refueling.
GSU
Rate Cap and Other Merger-Related Rate Agreements
In 1993, the LPSC and the PUCT approved separate regulatory
proposals, which included the implementation of a five-year Rate Cap on
GSU's retail electric base rates in the respective states and
provisions for passing fuel and nonfuel savings created by the Merger
on to the customers. See Note 2 for a discussion of the Rate Cap as
well as other aspects of the settlement agreement between GSU and the
LPSC and the PUCT.
Recovery of River Bend Costs
GSU deferred approximately $369 million of River Bend operating
costs, purchased power costs, and accrued carrying charges pursuant to
a 1986 PUCT accounting order. Approximately $182 million of these
costs are being amortized over a 20-year period ending in the year
2009, and the remaining $187 million are not being amortized pending
the ultimate outcome of the Rate Appeal as discussed in "Texas
Jurisdiction - River Bend," below. As of December 31, 1995, the
unamortized balance of these costs was $312 million. Further, GSU
deferred approximately $400.4 million of similar costs pursuant to a
1986 LPSC accounting order. These costs, of which approximately $83
million are unamortized as of December 31, 1995, are being amortized
over a 10-year period ending in 1998.
In accordance with a phase-in plan approved by the LPSC, GSU
deferred $294 million of its River Bend costs related to the period
February 1988 through February 1991. GSU has amortized $172 million
through December 31, 1995, and the remaining $122 million will be
recovered over approximately 2.2 years.
Texas Jurisdiction - River Bend
In May 1988, the PUCT granted GSU a permanent increase in annual
revenues of $59.9 million resulting from the inclusion in rate base of
approximately $1.6 billion of company-wide River Bend plant investment
and approximately $182 million of related Texas retail jurisdiction
deferred River Bend costs (Allowed Deferrals). In addition, the PUCT
disallowed as imprudent $63.5 million of company-wide River Bend plant
costs and placed in abeyance, with no finding as to prudence,
approximately $1.4 billion of company-wide River Bend plant investment
and approximately $157 million of Texas retail jurisdiction deferred
River Bend operating and carrying costs.
As discussed in Note 2, various appeals of the PUCT's order have
been filed. GSU has filed an appeal with the Texas Supreme Court. On
February 9, 1996, the Texas Supreme Court agreed to hear the appeal.
Oral arguments are scheduled for March 19, 1996.
As of December 31, 1995, the River Bend plant costs disallowed for
retail ratemaking purposes in Texas, the River Bend plant costs held in
abeyance, and the related operating and carrying cost deferrals totaled
(net of taxes) approximately $13 million, $276 million (both net of
depreciation), and $169 million, respectively. Allowed Deferrals were
approximately $83 million, net of taxes and amortization, as of
December 31, 1995. GSU estimates it has recorded approximately $182
million of revenues as of December 31, 1995, as a result of the
originally ordered rate treatment by the PUCT of these deferred costs.
If recovery of the Allowed Deferrals is not upheld, future revenues
based upon those allowed deferrals could be lost, and no assurance can
be given as to whether or not refunds to customers of revenue received
based upon such deferred costs will be required.
As discussed in Note 2, as of December 31, 1995, GSU has made no
write-offs or reserves for the River Bend-related costs. See below for
a discussion of the write-off of deferred operating and carrying costs
required under SFAS 121 in 1996. Based on advice from Clark, Thomas &
Winters, A Professional Corporation, legal counsel of record in the
Rate Appeal, management believes that it is reasonably possible that
the case will be remanded to the PUCT, and that the PUCT will be
allowed to rule on the prudence of the abeyed River Bend plant costs.
Management and legal counsel are unable to predict the amount, if any,
of abeyed and previously disallowed River Bend plant costs that
ultimately may be disallowed by the PUCT. As of December 31, 1995, a
net of tax write-off of up to $289 million could be required if the
PUCT ultimately issues an adverse ruling on the abeyed and disallowed
plant costs.
The following factors support management's position that a loss
contingency requiring accrual has not occurred, and that all, or
substantially all, of the abeyed plant costs will ultimately be
recovered:
1. The $1.4 billion of abeyed River Bend plant costs have never
been ruled imprudent and disallowed by the PUCT;
2. Analysis by Sandlin Associates, management consultants with
expertise in the cost of nuclear power plants, which supports
the prudence of substantially all of the abeyed construction
costs;
3. Historical inclusion by the PUCT of prudent construction costs
in rate base; and
4. The analysis of GSU's legal staff, which has considerable
experience in Texas rate case litigation.
Additionally, based on advice from Clark, Thomas & Winters, A
Professional Corporation, legal counsel of record in the Rate Appeal,
management believes that it is reasonably possible that the Allowed
Deferrals will continue to be recovered in rates, and that it is
reasonably possible that the deferred costs related to the $1.4 billion
of abeyed River Bend plant costs will be recovered in rates to the
extent that the $1.4 billion of abeyed River Bend plant is recovered.
The adoption of SFAS 121, "Accounting for the Impairment of Long-
Lived Assets and for Long-Lived Assets to Be Disposed Of" (SFAS 121),
became effective January 1, 1996. SFAS 121 changes the standard for
continued recognition of regulatory assets, and as a result in 1996 GSU
will be required to write-off $169 million of rate deferrals discussed
above. The standard also describes circumstances that may result in
assets being impaired and provides criteria for recognition and
measurement of asset impairment. See Note 1 for further information
regarding SFAS 121.
NISCO Unrecovered Costs
In 1986, the PUCT ordered that the purchased power costs from
NISCO in excess of GSU's avoided costs be disallowed. The PUCT
disallowance resulted in approximately $12 million to $15 million of
unrecovered purchased power costs on an annual basis, which GSU
continued to expense as the costs were incurred. In April 1991, the
Texas Supreme Court, on the appeal of such order, ordered the PUCT to
allow GSU to recover purchased power payments in excess of its avoided
cost in future proceedings if GSU established to the PUCT's
satisfaction that the payments were reasonable and necessary expenses.
In January 1992, GSU applied to the PUCT for a new fixed fuel
factor and requested a final reconciliation of fuel and purchased power
costs incurred between December 1, 1986 and September 30, 1991. GSU
proposed to recover net under-recoveries and interest (including under-
recoveries related to NISCO) over a twelve-month period. In June 1993,
the PUCT concluded that the purchased power payments made to NISCO in
excess of GSU's avoided cost were not reasonably incurred. In October
1993, GSU appealed the PUCT's order to the Travis County District Court
where the matter is still pending. As of December 31, 1995, GSU has
expensed $119.4 million of unrecovered purchased power costs and
deferred revenue pending the appeal of the District Court. No
assurance can be given as to the timing or outcome of the appeal.
PUCT Fuel Cost Review
On January 9, 1995, GSU and various parties reached an agreement
for the reconciliation of over- and under-recovery of fuel and
purchased power expenses for the period October 1, 1991, through
December 31, 1993. On April 17, 1995, the PUCT issued a final order
approving the settlement. As a result of the PUCT order, $7.6 million
of prior period fuel costs were refunded to customers through the fuel
adjustment clause.
Retail Rate Proceedings
Refer to Note 2 for a discussion of additional retail rate
proceedings which have been resolved during the current year and/or are
currently outstanding in the regulatory jurisdictions in which GSU
operates.
Fuel Recovery
GSU's Texas rate schedules include a fixed fuel factor to recover
fuel and purchased power costs not recovered in base rates. The fixed
factor may be revised every six months in accordance with a schedule
set by the PUCT for each utility. To the extent actual costs vary from
the fixed factor, refunds or surcharges are required or permitted,
respectively. Fuel costs are also subject to reconciliation
proceedings every three years. GSU's Louisiana electric rate schedules
include a fuel adjustment clause to reflect the cost of fuel and
purchased power costs in the second prior month, adjusted by a
surcharge for deferred fuel expense arising from the monthly
reconciliation of actual fuel cost incurred with fuel revenues billed
to customers.
GSU's Louisiana gas rates include a purchased gas adjustment to
recover the cost of purchased gas.
Steam Customer Contract
GSU is currently negotiating with its only steam customer whose
contract is scheduled to expire in 1997. It is anticipated that GSU
will be successful in such negotiations and the contract will be
renewed. During 1995 sales to this customer contributed $44.5 million
in base revenues to GSU.
LP&L
Recovery of Waterford 3 and Grand Gulf 1 Costs
In a series of LPSC orders, court decisions, and agreements from
late 1985 to mid-1988, LP&L was granted rate relief with respect to
costs associated with Waterford 3 and LP&L's share of capacity and
energy from Grand Gulf l, subject to certain terms and conditions.
With respect to Waterford 3, LP&L was granted an increase aggregating
$170.9 million over the period 1985-1988, and LP&L agreed to
permanently absorb, and not recover from retail ratepayers, $284
million of its investment in the unit and to defer $266 million of its
costs related to the years 1985-1988 to be recovered over approximately
8.6 years beginning in April 1988. As of December 31, 1995, LP&L's
unrecovered deferral balance was $26 million.
With respect to Grand Gulf l, LP&L agreed to retain, and not
recover from retail ratepayers, 18% of its 14% share or, approximately
2.52% of the costs of Grand Gulf l's capacity and energy. LP&L is
allowed to recover, through the fuel adjustment clause, 4.6 cents per
KWh for the energy related to its retained portion of these costs.
Alternatively, LP&L may sell such energy to nonaffiliated parties at
prices above the fuel adjustment clause recovery amount, subject to the
LPSC's approval.
Performance-Based Formula Rate Plan
In June 1995, in conjunction with the LPSC's rate review, a
performance-based formula rate plan previously proposed by LP&L was
approved with certain modifications. At the same time, the LPSC
ordered a $49.4 million reduction in base rates. For a discussion of
LP&L's approved performance-based formula rate plan, LP&L's subsequent
appeal of the LPSC's June 1995 rate order, and the final settlement of
this appeal, see Note 2.
Fuel Adjustment Clause
LP&L's rate schedules include a fuel adjustment clause to reflect
the cost of fuel and purchased power in the second prior month. The
fuel adjustment also reflects a surcharge for deferred fuel expense
arising from the monthly reconciliation of actual fuel cost incurred
with fuel revenues billed to customers.
MP&L
Retail Rate Proceedings
Refer to Note 2 for a discussion of the retail rate proceedings
which have been resolved during the current year and/or are currently
outstanding in the regulatory jurisdictions in which MP&L operates.
Rate Freeze
In connection with the settlement of various issues related to the
Merger, MP&L agreed that it will not request any general retail rate
increase to take effect before November 3, 1998, except for certain
instances. See Note 2 for a discussion of the rate freeze as well as
other aspects of the settlement agreement between MP&L and the MPSC.
Recovery of Grand Gulf 1 Costs
In 1988 the MPSC granted MP&L an annual base rate increase of
approximately $326.5 million in connection with its allocated share of
Grand Gulf 1 costs. The MPSC also provided for the deferral of a
portion of such costs that were incurred each year through 1992, and
recovery of these deferrals over a period of six years ending in 1998.
As of December 31, 1995, the uncollected balance of MP&L's deferred
costs was approximately $378 million. MP&L is permitted to recover the
carrying charges on all deferred amounts on a current basis.
Formula Rate Plan
Under a formulary incentive rate plan (Formula Rate Plan)
effective March 25, 1994, MP&L's earned rate of return is calculated
automatically every 12 months and compared to and adjusted against a
benchmark rate of return (calculated under a separate formula within
the Formula Rate Plan). The Formula Rate Plan allows for periodic
small adjustments in rates based on a comparison of actual earned
returns to benchmark returns and upon certain performance factors.
Pursuant to a stipulation with the MPSC's Public Utilities Staff, MP&L
did not request an adjustment in rates based on its earned rate of
return for the 12-months ended December 31, 1994.
Fuel Adjustment Clause
MP&L's rate schedules include a fuel adjustment clause that
recovers changes in cost of fuel and purchased power. The monthly fuel
adjustment rate is based on projected sales and costs for the month,
adjusted for differences between actual and estimated costs and KWh
sales for the second prior month.
NOPSI
Recovery of Grand Gulf 1 Costs
Under NOPSI's various Rate Settlements with the Council in 1986,
1988, and 1991, NOPSI agreed to absorb and not recover from ratepayers
a total of $96.2 million of its Grand Gulf 1 costs. NOPSI was
permitted to implement annual rate increases in decreasing amounts each
year through 1995, and to defer certain costs and related carrying
charges, for recovery on a schedule extending from 1991 through 2001.
As of December 31, 1995, the uncollected balance of NOPSI's deferred
costs was $171 million. The 1994 NOPSI Settlement did not affect the
scheduled Grand Gulf 1 phase-in rate increases.
1994 NOPSI Settlement
In a settlement with the Council that was approved on December 29,
1994, NOPSI agreed to reduce electric and gas rates and issue credits
and refunds to customers. Effective January 1, 1995, NOPSI implemented
a $31.8 million permanent reduction in electric base rates and a $3.1
million permanent reduction in gas base rates. The 1994 NOPSI
Settlement also required NOPSI to credit its customers $25 million over
a 21-month period, beginning January 1, 1995, in order to resolve
disputes with the Council regarding the interpretation of the 1991
NOPSI Settlement. See Note 2 for additional discussion of the rate
reductions and refunds ordered by the Council in the 1994 NOPSI
settlement, as well as the 1995 and 1996 annual earnings reviews
required by the Council.
Fuel Adjustment Clause
NOPSI's electric rate schedules include a fuel adjustment clause
to reflect the cost of fuel in the second prior month, adjusted by a
surcharge for deferred fuel expense arising from the monthly
reconciliation of actual fuel incurred with fuel cost revenues billed
to customers. The adjustment, on a monthly basis, also reflects the
difference between nonfuel Grand Gulf 1 costs paid by NOPSI and the
estimate of such costs provided in NOPSI's Grand Gulf 1 Rate
Settlements. NOPSI's gas rate schedules include an adjustment to
reflect gas costs in excess of those collected in base rates, adjusted
by a surcharge similar to that included in the electric fuel adjustment
clause.
Regulation
Federal Regulation (Entergy Corporation, AP&L, GSU, LP&L, MP&L, NOPSI,
and System Energy)
PUHCA
Entergy Corporation is a public utility holding company registered
under PUHCA. As such, Entergy Corporation and its various direct and
indirect subsidiaries (with the exception of its EWG and foreign
utility subsidiaries) are subject to the broad regulatory provisions of
that Act. Except with respect to investments in certain domestic power
projects, foreign utility company projects, and telecommunication
projects, PUHCA limits the operations of a registered holding company
system to a single, integrated public utility system, plus additional
systems and businesses as provided by that section. See "MANAGEMENT'S
FINANCIAL DISCUSSION AND ANALYSIS - SIGNIFICANT FACTORS AND KNOWN
TRENDS," for a discussion of the Telecommunications Act.
Entergy Corporation and other electric utility holding companies,
have supported legislation in the United States Congress which would
repeal PUHCA, which requires detailed oversight by the SEC of many
business practices and activities of utility holding companies and
their subsidiaries. The proposed legislation would transfer certain
aspects of the oversight of public utility holding companies from the
SEC to FERC.
Entergy believes that PUHCA inhibits its ability to compete in the
evolving electric energy marketplace and largely duplicates the
oversight activities already performed by FERC and state and local
regulators. In June 1995, the SEC adopted a report proposing options
for the repeal or significant modification of PUHCA and proposed rule
changes that would reduce the regulations governing utility holding
companies. One rule change adopted as a result of such proposals
eliminated the requirement to receive prior authorization for capital
contributions made by a parent company to its nonutility subsidiary
companies and for financing its non utility subsidiary companies. Such
rule was appealed to the D.C. Circuit by the City of New Orleans where
the appeal was denied in January 1996.
Federal Power Act
The Operating Companies, System Energy, and Entergy Power are
subject to the Federal Power Act as administered by FERC and the DOE.
The Federal Power Act provides for regulatory jurisdiction over the
licensing of certain hydroelectric projects, the transmission and
wholesale sale of electric energy in interstate commerce, and certain
other activities, including accounting policies and practices. Such
regulation includes jurisdiction over the rates charged by System
Energy for capacity and energy provided to AP&L, LP&L, MP&L, and NOPSI
from Grand Gulf 1.
AP&L holds a license for two hydroelectric projects (70 MW) that
was renewed on July 2, 1980. This license, granted by FERC, will
expire in February 2003.
Regulation of the Nuclear Power Industry (Entergy Corporation, AP&L,
GSU, LP&L, and System Energy)
General
Under the Atomic Energy Act of 1954 and the Energy Reorganization
Act of 1974, operation of nuclear plants is intensively regulated by
the NRC, which has broad power to impose licensing and safety-related
requirements. In the event of non-compliance, the NRC has the
authority to impose fines or shut down a unit, or both, depending upon
its assessment of the severity of the situation, until compliance is
achieved. AP&L, GSU, LP&L, and System Energy, as owners of all or a
portion of ANO, River Bend, Waterford 3, and Grand Gulf 1,
respectively, and Entergy Operations, as the operator of these units,
are subject to the jurisdiction of the NRC. Revised safety
requirements promulgated by the NRC have, in the past, necessitated
substantial capital expenditures at these nuclear plants, and
additional such expenditures could be required in the future.
The nuclear power industry faces uncertainties with respect to the
cost and long-term availability of sites for disposal of spent nuclear
fuel and other radioactive waste, nuclear plant operations, the
technological and financial aspects of decommissioning plants at the
end of their licensed lives, and requirements relating to nuclear
insurance. These matters are briefly discussed below.
Spent Fuel and Other High-Level Radioactive Waste
Under the Nuclear Waste Policy Act of 1982, the DOE is required,
for a specified fee, to construct storage facilities for, and to
dispose of, all spent nuclear fuel and other high-level radioactive
waste generated by domestic nuclear power reactors. However, the DOE
has not yet identified a permanent storage repository and, as a result,
future expenditures may be required to increase spent fuel storage
capacity at the plant sites. For further information concerning spent
fuel disposal contracts with the DOE, schedules for initial shipments
of spent nuclear fuel, current on-site storage capacity, and costs of
providing additional on-site storage, see Note 8.
Low-Level Radioactive Waste
The availability and cost of disposal facilities for low-level
radioactive waste resulting from normal nuclear plant operations are
subject to a number of uncertainties. Under the Low-Level Radioactive
Waste Policy Act of 1980, as amended, each state is responsible for
disposal of its own waste, and states may participate in regional
compacts to fulfill their responsibilities jointly. The States of
Arkansas and Louisiana participate in the Central States Compact, and
the State of Mississippi participates in the Southeast Compact. Two
disposal sites are currently operating in the United States, and until
recently both were closed to out-of-region generators. The Barnwell
Disposal Facility (Barnwell), located in South Carolina and operated by
the Southeast Compact, reopened to out-of-region generators in July
1995. The South Carolina State legislative action reopening Barnwell
must be renewed annually. The availability of Barnwell provides only
temporary relief from low-level radioactive waste storage and does not
alleviate the need to develop new disposal capacity.
Both the Central States Compact and the Southeast Compact are
working to establish additional disposal sites. The System, along with
other waste generators, funds the development costs for new disposal
facilities. As of December 1995, the System's cumulative expenditures
for the development of new disposal facilities totaled approximately
$38 million. Future levels of expenditures cannot be predicted. Until
long-term disposal facilities are established, the System will seek
continued access to existing facilities. If such access is
unavailable, the System will store low-level waste at its nuclear plant
sites.
Decommissioning
AP&L, GSU, LP&L, and System Energy are recovering from ratepayers
portions of their estimated decommissioning costs for ANO, River Bend,
Waterford 3, and Grand Gulf 1, respectively. These amounts are
deposited in trust funds that, together with the related earnings, can
only be used for future decommissioning costs. Estimated
decommissioning costs are periodically reviewed and updated to reflect
inflation and changes in regulatory requirements and technology, and
applications are periodically made to appropriate regulatory
authorities to reflect in rates any future changes in projected
decommissioning costs. For additional information with respect to
decommissioning costs for ANO, River Bend, Waterford 3, and Grand Gulf
1, see Note 8.
Uranium Enrichment Decontamination and Decommissioning Fees
The EPAct requires all electric utilities (including AP&L, GSU,
LP&L, and System Energy) that have purchased uranium enrichment
services from the DOE to contribute up to a total of $150 million
annually, adjusted for inflation, up to a total of $2.25 billion over
approximately 15 years, for decontamination and decommissioning of
enrichment facilities. In accordance with the EPAct, contributions to
decontamination and decommissioning funds are recovered through rates
in the same manner as other fuel costs. See Note 8 for the estimated
annual contributions by the System companies for decontamination and
decommissioning fees.
Nuclear Insurance
The Price-Anderson Act limits public liability for a single
nuclear incident to approximately $8.92 billion. AP&L, GSU, LP&L, and
System Energy have protection with respect to this liability through a
combination of private insurance and an industry assessment program,
and also have insurance for property damage, costs of replacement
power, and other risks relating to nuclear generating units. For a
discussion of insurance applicable to the nuclear programs of AP&L,
GSU, LP&L, and System Energy, see Note 8.
Nuclear Operations
General (Entergy Corporation, AP&L, GSU, LP&L, and System Energy)
Entergy Operations operates ANO, River Bend, Waterford 3, and
Grand Gulf 1, subject to the owner oversight of AP&L, GSU, LP&L, and
System Energy, respectively. AP&L, GSU, LP&L, and System Energy, and
the other Grand Gulf 1 and River Bend co-owners, have retained their
ownership interests in their respective nuclear generating units.
AP&L, GSU, LP&L, and System Energy have also retained their associated
capacity and energy entitlements, and pay directly or reimburse Entergy
Operations at cost for its operation of the units.
ANO Matters (Entergy Corporation and AP&L)
Entergy Operations has made inspections and repairs from time to
time on ANO 2's steam generators. During the October 1995 inspection,
additional cracks in the tubes were discovered. Currently, Entergy
Operations is monitoring the development of the cracks and assessing
various options for the repair or the replacement of ANO 2's steam
generators. See Note 8 for additional information.
River Bend (Entergy Corporation and GSU)
In connection with the Merger, GSU filed two applications with the
NRC in January 1993 to amend the River Bend operating license. The
applications sought the NRC's consent to the Merger and to a change in
the licensed operator of the facility from GSU to Entergy Operations.
In August 1993 Cajun filed a petition to intervene and a request for a
hearing in the proceeding. In January 1994, the presiding NRC Atomic
Safety and Licensing Board (ASLB) issued an order granting Cajun's
petition to intervene and ordering a hearing on one of Cajun's
contentions. In 1994, subsequent to Cajun's intervention in such
proceedings, the NRC Staff issued the two license amendments for River
Bend, which were effective immediately upon consummation of the Merger.
A hearing on the proceeding before the ASLB has been postponed, pending
approval of a petition by Cajun to withdraw such a proceeding. On
February 14, 1994, Cajun filed with the D.C. Circuit petitions for
review of the two license amendments for River Bend. In March 1995,
the D.C. Circuit ordered the original NRC order and license amendments
be set aside, and remanded the case to the NRC for further
consideration. Subsequently, the NRC affirmed its original findings
and reissued the two license amendments approving the Merger and the
change in the licensed operator of River Bend. Cajun has filed a
petition for review with the D. C. Circuit, and oral arguments are
expected to be heard in May 1996. These two amendments are in full
force and effect, but are subject to the outcome of the two
proceedings.
State Regulation (AP&L, GSU, LP&L, MP&L, and NOPSI)
General
Each of the Operating Companies is subject to regulation by state
and/or local regulatory authorities having jurisdiction over the areas
in which it operates. Such regulation includes authority to set rates
for retail electric and gas service. (See "RATE MATTERS AND REGULATION
- - - - - Rate Matters - Retail Rate Matters," above.)
AP&L is subject to regulation by the APSC and the Tennessee Public
Service Commission (TPSC). APSC regulation includes the authority to
set rates, determine reasonable and adequate service, fix the value of
property used and useful, require proper accounting, control leasing,
control the acquisition or sale of any public utility plant or property
constituting an operating unit or system, set rates of depreciation,
issue certificates of convenience and necessity and certificates of
environmental compatibility and public need, and control the issuance
and sale of securities. Regulation by the TPSC includes the authority
to set standards of service and rates for service to customers in the
state, require proper accounting, control the issuance and sale of
securities, and issue certificates of convenience and necessity.
GSU is subject to the jurisdiction of the municipal authorities of
incorporated cities in Texas as to retail rates and services within
their boundaries, with appellate jurisdiction over such matters
residing in the PUCT. GSU is also subject to regulation by the PUCT as
to retail rates and services in rural areas, certification of new
generating plants, and extensions of service into new areas. GSU is
subject to regulation by the LPSC as to electric and gas service, rates
and charges, certification of generating facilities and power or
capacity purchase contracts, depreciation, accounting, and other
matters.
LP&L is subject to regulation by the LPSC as to electric service,
rates and charges, certification of generating facilities and power or
capacity purchase contracts, depreciation, accounting, and other
matters. LP&L is also subject to the jurisdiction of the Council with
respect to such matters within Algiers.
MP&L is subject to regulation as to service, service areas,
facilities, and retail rates by the MPSC. MP&L is also subject to
regulation by the APSC as to the certificate of environmental
compatibility and public need for the Independence Station.
NOPSI is subject to regulation by the Council as to electric and
gas service, rates and charges, standards of service, depreciation,
accounting, issuance of certain securities, and other matters.
Franchises
AP&L holds exclusive franchises to provide electric service in 300
incorporated cities and towns in Arkansas. These franchises are
unlimited in duration and continue until such a time when the
municipalities purchase the utility property. In Arkansas, franchises
are considered to be contracts and, therefore, are terminable upon
breach of the contract.
GSU holds non-exclusive franchises, permits, or certificates of
convenience and necessity to provide electric and gas service in 55
incorporated villages, cities, and towns in Louisiana and 64
incorporated cities and towns in Texas. GSU ordinarily holds 50-year
franchises in Texas and 60-year franchises in Louisiana. GSU's current
electric franchises will expire in 2007 - 2036 in Texas and in 2015 -
2046 in Louisiana. The natural gas franchise in the City of Baton
Rouge will expire in 2015. In addition, GSU has received from the PUCT
a certificate of convenience and necessity to provide electric service
to areas within 21 counties in eastern Texas.
LP&L holds non-exclusive franchises to provide electric service in
116 incorporated villages, cities, and towns. Most of these municipal
franchises have 25-year terms, although six municipalities have granted
LP&L 60-year franchises. LP&L also supplies electric service in 353
unincorporated communities, all of which are located in parishes in
which LP&L holds non-exclusive franchises.
MP&L has received from the MPSC certificates of public convenience
and necessity to provide electric service to areas within 45 counties
in western Mississippi, which include a number of municipalities.
Under Mississippi statutory law, such certificates are exclusive. MP&L
may continue to serve in such municipalities upon payment of a
statutory franchise fee, regardless of whether an original municipal
franchise is still in existence.
NOPSI provides electric and gas service in the City of New Orleans
pursuant to city ordinances, which state, among other things, that the
City has a continuing option to purchase NOPSI's electric and gas
utility properties.
System Energy has no distribution franchises. Its business is
currently limited to wholesale power sales.
Environmental Regulation
General
In the areas of air quality, water quality, control of toxic
substances and hazardous and solid wastes, and other environmental
matters, the facilities and operations of the System companies are
subject to regulation by various federal, state, and local authorities.
The System companies believe they are in substantial compliance with
environmental regulations currently applicable to their respective
facilities and operations. They have incurred significant costs in
meeting environmental protection standards. Because environmental
regulations are continually changing, the ultimate compliance costs to
the System companies cannot be precisely estimated. However,
management currently estimates that ultimate capital expenditures for
environmental compliance purposes, including those discussed in "Clean
Air Legislation," below, will not be material for the System as a
whole.
Clean Air Legislation
The Clean Air Act Amendments of 1990 (the Act) set up three
programs that affect the System companies: an acid rain program for
control of sulfur dioxide (SO2) and nitrogen oxides (NOx), an ozone
nonattainment area program for control of NOx and volatile organic
compounds, and an operating permits program for administration and
enforcement of these and other Clean Air Act programs.
Under the acid rain program, no additional control equipment is
expected to be required by the System to control SO2. The Act provides
"allowances" to most of the affected System companies' generating units
for emissions based upon past emission levels and operating
characteristics. Each allowance is an entitlement to emit one ton of
SO2 per year. Under the Act, utilities will be required to possess
allowances for SO2 emissions from affected generating units. All of
the Entergy company generating units are classified as "Phase II" units
under the Act and are subject to SO2 allowance requirements beginning
in the year 2000. Based on operating history, the System companies are
considered "clean" utilities and have been allocated more allowances
than are currently necessary for normal operations. Management
believes that it will be able to operate its units efficiently without
installing scrubbers or purchasing allowances from outside sources, and
that one or more of the System companies may have excess allowances
available for sale.
The System companies have installed continuous emission monitoring
(CEM) equipment at their fossil generating units to comply with EPA
regulations under the Act, and CEM software and computer equipment is
currently being updated at AP&L, MP&L, LP&L, and NOPSI generating
units. Such CEM equipment resulted in approximately $5.2 million of
capital costs during 1995. No material costs for CEM equipment are
expected in 1996.
Control equipment may eventually be required for NOx reductions
due to the ozone nonattainment status of the areas served by GSU in and
around Beaumont and Houston, Texas. Texas environmental authorities
are studying the causes of ozone pollution and will decide during 1996
whether to require controls. If Texas decides to regulate NOx, the
cost of such control equipment for the affected GSU plants is estimated
at $10.4 million through the year 2000.
In accordance with the Act, the EPA promulgated operating permit
regulations in 1994 that may set new operating criteria for fossil
plants relating to fuels, emissions, and equipment maintenance
practices. Some or all Entergy Companies may also have to install
additional CEM equipment as a result of these regulations. The cost
will be determined on a state-by-state basis as the plants are granted
permits during 1996 and 1997. Related capital and operation and
maintenance costs are expected to begin in 1996, but are not expected
to be material. The authority to impose permit fees under this program
has been delegated to the states by the EPA and, depending on the
outcomes of various decisions of each state regulatory authority, total
permit fees for the System could range from $1.6 to $5.0 million
annually.
Other Environmental Matters
The provisions of the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended (CERCLA), authorize
the EPA and, indirectly, the states to require generators and certain
transporters of certain hazardous substances released from or at a
site, and the owners or operators of any such site, to clean-up the
site or reimburse such clean-up costs. CERCLA has been interpreted to
impose joint and several liability on responsible parties. The System
companies sent waste materials to various disposal sites over the
years. Also, certain operating procedures and maintenance practices,
that historically were not subject to regulation, are now regulated by
environmental laws. Some of these sites have been the subject of
governmental action under CERCLA, as a result of which the System
companies have become involved with site clean-up activities. The
System companies have participated to various degrees in accordance
with their potential liability in such site clean-ups and have
developed experience with clean-up costs. The System companies have
established reserves for such environmental clean-up/restoration
activities. In the aggregate, the cost of such remediation is not
considered material to the System.
AP&L
AP&L has received notices from time to time from the EPA, the
Arkansas Department of Pollution Control and Ecology (ADPC&E), and
others alleging that it, along with others, may be a PRP for clean-up
costs associated with various sites in Arkansas. Most of these sites
are neither owned nor operated by any System company. Contaminants at
the sites include polychlorinated biphenyls (PCBs), lead, and other
hazardous substances.
In response to such notices from the EPA and the ADPC&E, the sites
discussed below have been remediated:
At the EPA's request, AP&L voluntarily performed stabilization
activities at the Benton Salvage site in Saline County, Arkansas.
While the EPA has not named PRPs for this site, AP&L has negotiated an
agreement with the EPA to remove waste stored at the site. AP&L will
spend approximately $250,000 to remove and dispose of waste material at
the Benton Salvage site. Although GSU and LP&L have had minor
involvement in the Benton Salvage site, no remediation action is
anticipated by these companies.
As a result of an internal investigation, AP&L has identified soil
contamination at AP&L-owned sites located in Blytheville and Pine
Bluff, Arkansas. The contamination appears to be a result of operating
procedures that were performed prior to any applicable environmental
regulation. Remediation of the Blytheville and Pine Bluff sites was
completed in 1995 at a total cost of approximately $2.25 million.
Reynolds Metals Company (Reynolds) and AP&L notified the EPA in
1989 of possible PCB contamination at two former Reynolds plant sites
(Jones Mill and Patterson) in Arkansas to which AP&L had supplied
power. Subsequently, AP&L completed remediation at the substations
serving the plant sites at a cost of $1.7 million. Additional PCB
contamination was found in a portion of a drainage ditch that flows
from the Patterson facility to the Ouachita River. Reynolds demanded
that AP&L participate in remediation efforts with respect to the ditch.
AP&L and independent contractors engaged by AP&L conducted an
investigation of the ditch contamination and the possible migration of
PCBs from the electrical equipment that AP&L maintained at the plant.
The investigation concluded that little, if any, of the contamination
was caused by AP&L. AP&L has thus far expended approximately $150,000
on investigation of the ditch. In May 1995, AP&L was named as a
defendant in a suit by Reynolds seeking to recover a share of its costs
associated with the clean-up of hazardous substances at the Patterson
site. Reynolds alleges that it has spent $11.2 million to clean-up the
site, and that AP&L bears some responsibility for PCB contamination at
the site. AP&L believes that it has no liability for contamination at
the Patterson site and is contesting the lawsuit.
AP&L entered into a Consent Administrative Order, dated February
21, 1991, with the ADPC&E that named AP&L as a PRP for the initial
stabilization associated with contamination at the Utilities Services,
Inc. state Superfund site located near Rison, Arkansas. This site was
found to have soil contaminated by PCBs and pentachlorophenol (a wood
preservative). Containers and drums that contained PCBs and other
hazardous substances were found at the site. AP&L's share of total
remediation costs is estimated to range between $3.0 and $5.0 million.
AP&L is attempting to identify and notify other PRPs with respect to
this site. AP&L has received assurances that the ADPC&E will use its
enforcement authority to allocate remediation expenses among AP&L and
any other PRPs that can be identified. Approximately 20 PRPs have been
identified to date. AP&L has performed the activities necessary to
stabilize the site, at a cost of approximately $350,000. AP&L believes
that its potential liability for this site will not be material.
GSU
GSU has been designated by the EPA as a PRP for the clean-up of
certain hazardous waste disposal sites. GSU is currently negotiating
with the EPA and state authorities regarding the clean-up of these
sites. Several class action and other suits have been filed in state
and federal courts seeking relief from GSU and others for damages
caused by the disposal of hazardous waste and for asbestos-related
disease allegedly resulting from exposure on GSU premises (see "Other
Regulation and Litigation" below). While the amounts at issue may be
substantial, GSU believes that its results of operations and financial
condition will not be materially adversely affected by the outcome of
the suits. Through December 31, 1995, $7.9 million has been expended
on clean-up activities. As of December 31, 1995, a remaining recorded
liability of $21.7 million existed relating to the clean-up of five
sites at which GSU has been designated a PRP.
In 1971, GSU purchased property near its Sabine generating
station, known as the Bailey site, for possible expansion of cooling
water facilities. Although it was not known to GSU at the time, the
property was utilized by area industries in the 1950's and 1960's as an
industrial waste dump. GSU sold the property in 1984. In October
1984, an abandoned waste site on the property was included on the
Superfund National Priorities List (NPL) by the EPA. GSU has pursued
negotiations with the EPA and is a member of a task force with other
PRPs for the voluntary clean-up of the waste site. A Consent Decree
has been signed by all PRPs for the voluntary clean-up of the Bailey
site. Additional wastes have been discovered at the site since the
original clean-up costs were estimated. Remediation of the Bailey site
is being redesigned and costs are currently expected to be
approximately $33 million. GSU is expected to be responsible for 2.26%
of the estimated clean-up cost. Federal and state agencies are
presently examining potential liabilities associated with natural
resource damages. This matter is currently under negotiation with the
other PRPs and the agencies. GSU does not believe that its ultimate
responsibility with respect to this site will be material after
allowance for the existing clean-up reserve in the amount of $760,000.
GSU is currently involved in a multi-phased remedial investigation
of an abandoned manufactured gas plant (MGP) site, known as the Lake
Charles Service Center, located in Lake Charles, Louisiana. The
property was the site of an MGP that is believed to have operated from
approximately 1916 to 1931. Coal tar, a by-product of the distillation
process employed at MGPs, was apparently routed to a portion of the
property for disposal. The same area has also been used as a landfill.
Under an order issued by the Louisiana Department of Environmental
Quality (LDEQ), which is currently stayed, GSU was required to
investigate and, if necessary, take remedial action at the site.
Preliminary estimates of remediation costs are approximately $20
million. On February 13, 1995, the EPA published a proposed rule
adding the Lake Charles Service Center to the NPL. Another PRP has
been identified and is believed to have had a role in the ownership and
operation of the MGP. Negotiations with that company for joint
participation and possible remedial action have been held and are
expected to continue. GSU currently is awaiting notification from the
EPA before initiating additional clean-up negotiations or actions. GSU
does not presently believe that its ultimate responsibility with
respect to this site will be material, after allowance for the existing
clean-up reserve of $19.8 million.
GSU along with LP&L has been named as a PRP for an abandoned waste
oil recycling plant site in Livingston Parish, Louisiana, known as
Combustion, Inc., which is included on the NPL. Although most surface
remediation has been completed, additional studies related to residual
groundwater contamination are expected to continue in 1996. GSU and
LP&L have been named as defendants in a class action lawsuit lodged
against a group of PRPs associated with the site. (For information
regarding litigation in connection with the Combustion, Inc. site, see
"Other Regulation and Litigation" below.) GSU does not presently
believe that its ultimate responsibility with respect to this site will
be material.
GSU received notification in 1992 from the EPA of potential
liability at a site located in Iota, Louisiana. This site was the
depository of a variety of wastes, including medical and chemical
wastes. In addition to GSU, over 200 parties have been named as PRPs.
The EPA has completed remediation at the Iota site. However, it is
continuing its investigation of the site and has notified the PRPs of
the possibility of this site being linked to other sites. GSU does not
believe it is implicated in these other sites. GSU has not received
notification of liability or location with regard to the other sites,
and does not believe that its ultimate responsibility with respect to
these other sites will be material.
GSU, along with AP&L and LP&L, has been notified of its potential
liability with respect to the Benton Salvage site located in Saline
County, Arkansas. Although GSU and LP&L have had minor involvement in
the Benton Salvage site, no remediation action is anticipated by these
companies. See "AP&L" above for a discussion of the Benton Salvage
site.
LP&L, NOPSI, and System Energy
LP&L, NOPSI, and System Energy have received notices from the EPA
and/or the states of Louisiana and Mississippi that one or more than
one company may be a PRP for disposal sites that are neither owned nor
operated by any System company. In response to such notices the sites
discussed below have been remediated:
LP&L and NOPSI have completed remediation at the Rose Chemical
site located in Missouri and the aggregate remaining costs are
considered immaterial.
LP&L, along with AP&L and GSU, was notified in 1990 of its
potential liability at the Benton Salvage site located in Saline
County, Arkansas. Although GSU and LP&L have been involved in the
Benton Salvage site, their contributions are considered minor; and
therefore, no remediation action is required by these companies. See
"AP&L" above for a discussion of the Benton Salvage site.
The EPA named LP&L and System Energy as two of the 44 PRPs for the
Disposal Systems, Inc. site in Mississippi. The State of Mississippi
has indicated that it intends to have the PRPs conduct a clean-up of
the Disposal Systems, Inc. site but has not yet taken formal action.
LP&L has settled this matter with the EPA. The State of Mississippi is
continuing to evaluate whether additional remediation measures are
necessary. However, further remediation costs at the Disposal Systems,
Inc. site are not expected to be material.
NOPSI received notice from the EPA with respect to a Mississippi
site, known as Pike County, in the fall of 1994. The EPA alleged that
NOPSI sold and shipped hazardous waste to the Pike County site during
1983 and 1984. NOPSI has negotiated a final settlement with the EPA
for remediation of the site and no further costs are expected.
From 1992 to 1994, LP&L performed site assessments and remedial
activities at three retired power plants, known as the Homer,
Jonesboro, and Thibodaux municipal sites, previously owned and operated
by Louisiana municipalities. LP&L purchased the power plants as part
of the acquisition of municipal electric systems after operating them
for the last few years of their useful lives. The site assessments
indicated some subsurface contamination from fuel oil. LP&L has
completed all remediation work to the LDEQ's satisfaction for these
three former generating plants, and follow-up sampling has been
completed at the Homer site. Sampling at the Jonesboro and Thibodaux
sites is expected to be completed in 1996. The costs incurred through
December 31, 1995 for the Homer, Jonesboro, and Thibodaux sites are
$22,000, $156,000, and $34,000, respectively. Any remaining costs are
considered immaterial.
There are certain disposal sites in which LP&L and NOPSI have been
named by the EPA as PRPs for associated clean-up costs, but management
believes no liability exists in connection with these sites for LP&L
and NOPSI. Such Louisiana sites include Combustion Inc., an abandoned
waste oil recycling plant site located in Livingston Parish (involving
at least 70 PRPs, including GSU), and the Dutchtown site (also included
on the NPL and involving 57 PRPs). LP&L has found no evidence of its
involvement in the Combustion Inc. site. (For information regarding
litigation in connection with the Livingston Parish site, see "Other
Regulation and Litigation," below). With respect to the Dutchtown
site, NOPSI believes it has no liability because the material it sent
to this site was not a hazardous substance.
During 1993, the LDEQ issued new rules for solid waste regulation,
including regulation of waste water impoundments. LP&L has determined
that certain of its power plant waste water impoundments were affected
by these regulations and has chosen to upgrade or close them. As a
result, a remaining recorded liability in the amount of $10.6 million
existed at December 31, 1995, for waste water upgrades and closures to
be completed by the end of 1996. Cumulative expenditures relating to
the upgrades and closures of waste water impoundments were $5.6 million
as of December 31, 1995.
Other Regulation and Litigation
Merger (Entergy Corporation and GSU)
In July and August 1992, Entergy Corporation and GSU filed
applications with FERC, the LPSC, and the PUCT, and Entergy
Corporation, Entergy Operations, and Entergy Services filed an
application with the SEC under PUHCA, seeking authorization of various
aspects of the Merger. In January 1993, GSU filed two applications
with the NRC seeking approval of the change in ownership of GSU and an
amendment to the operating license for River Bend to reflect its
operation by Entergy Operations. All regulatory approvals were
obtained in 1993 and the Merger was consummated on December 31, 1993.
FERC's December 15, 1993, and May 17, 1994, orders approving the
Merger were appealed to the D.C. Circuit by Entergy Services, the City,
the Arkansas Electric Energy Consumers (AEEC), the APSC, Cajun, the
MPSC, the American Forest and Paper Association, the State of
Mississippi, the City of Benton and other cities, and Occidental
Chemical Corporation (Occidental). Entergy seeks review of FERC's
deletion of a 40% cap on the amount of fuel savings GSU may be required
to transfer to other Entergy operating companies under a tracking
mechanism designed to protect the other companies from certain
unexpected increases in fuel costs. The other parties are seeking to
overturn FERC's decisions on various grounds, including the issues of
whether FERC appropriately conditioned the Merger to protect various
interested parties from alleged harm and FERC's reliance on Entergy's
transmission tariff to mitigate any potential anticompetitive impacts
of the Merger.
On November 18, 1994, the D. C. Circuit denied motions filed by
Cajun, Occidental, and AEEC for a remand to FERC and a partial summary
grant of the petitions for review. At the same time, the D.C. Circuit
ordered that the cases be held in abeyance pending FERC's issuance of
(1) a final order on remand in the proceedings on Entergy's
transmission tariff, see discussion of tariff case in "RATE MATTERS AND
REGULATION - Rate Matters - Wholesale Rate Matters - Open Access
Transmission" above, and (2) a final order on competition issues in the
proceedings on the Merger.
On December 30, 1993, Entergy Services submitted to FERC tariff
revisions to comply with FERC's order dated December 15, 1993,
approving the Merger. On February 4, 1994, the APSC and AEEC filed
with FERC a joint protest to the compliance filing. They alleged that
Entergy must insulate the ratepayers of AP&L, LP&L, MP&L, and NOPSI
from all litigation liabilities related to GSU's River Bend nuclear
facility. In its May 17, 1994, order on rehearing, FERC addressed
Entergy's commitment to insulate the customers of AP&L, LP&L, MP&L, and
NOPSI against liability resulting from certain litigation involving
River Bend. In response to FERC's clarification of Entergy's
commitment, Entergy Services filed a compliance filing on June 16,
1994, which amended certain System Agreement language submitted with
the December 30, 1993, filing. APSC and AEEC subsequently filed
protests questioning the adequacy of Entergy's June 16, 1994,
compliance filing. Entergy filed an answer to the protest reiterating
its full compliance with the requirements of FERC's May 17, 1994, order
on rehearing. FERC has not yet acted on the compliance filings.
Requests for rehearing of the SEC order were filed with the SEC by
Houston Industries Incorporated and Houston Lighting & Power Company on
December 28, 1993, and petitions for review seeking to set aside the
SEC order were filed with the D.C. Circuit by these parties and by
Cajun in February 1994. The matter has been remanded by the D.C.
Circuit to the SEC for further consideration in light of developments
at FERC relating to Entergy's transmission tariffs.
Appeals seeking to set aside the LPSC order related to the Merger
were filed in the 19th Judicial District Court for the Parish of East
Baton Rouge, Louisiana, by Houston Lighting & Power Company on August
13, 1993, and by the Alliance for Affordable Energy, Inc. on August 20,
1993. Subsequently, on February 9, 1994, Houston Lighting & Power
Company filed a motion voluntarily dismissing its appeal. In judgments
issued in February and November 1995, the 19th Judicial District Court
dismissed the appeals of the Alliance for Affordable Energy, Inc.
Flowage Easement Suits (AP&L)
Three lawsuits (subsequently consolidated into one) were filed in
the Arkansas District Court by numerous plaintiffs against AP&L and
Entergy Services in connection with the operation of two dams during a
period of heavy rainfall and flooding in May 1990. The consolidated
lawsuits sought approximately $14.4 million in property losses and
other compensatory damages, and $500 million in punitive damages. In
their responses to these complaints, AP&L and Entergy Services
asserted, among other things, that AP&L owns flowage easements giving
it the permanent right to inundate the lands owned or occupied by the
plaintiffs in connection with the operation of the dams. Rulings
issued by the Arkansas District Court in June and November 1991 found
that AP&L had the right to enforce its flowage easements and that
Entergy Services was entitled to the benefit of AP&L's flowage
easements. Such rulings removed from consideration damages in the
approximate amount of $13.5 million alleged to have occurred within the
areas covered by the easements. As a result, over 300 plaintiffs
claiming damage within the easements were dismissed from the
consolidated case in December 1991. Certain plaintiffs appealed the
Arkansas District Court rulings to the Eighth Circuit, and these
appeals were ultimately denied in December 1993. The remaining
plaintiffs, to whom the flowage easements did not apply, had obtained a
stay and an administrative termination of their claims, pending the
outcome of the appeal. On February 10, 1995, such plaintiffs
petitioned the Arkansas District Court to reopen the proceedings as to
their claims. In March 1995, the Arkansas District Court ordered the
reopening of the proceedings relating to the plaintiffs' claims which
were previously stayed and administratively terminated, and the claims
were subsequently tried. On November 9, 1995, the Arkansas District
Court dismissed all remaining plaintiffs' claims, resolving the case in
favor of AP&L.
Asbestos and Hazardous Waste Suits
(GSU and LP&L)
A number of plaintiffs who allegedly suffered damage or injury, or
are survivors of persons who allegedly died, as a result of exposure to
"hazardous toxic waste" that emanated from a site in Livingston Parish,
sued GSU and approximately 70 other defendants, including LP&L, in 17
suits filed in the Livingston Parish, Louisiana District Court (State
District Court). The plaintiffs alleged that the defendants generated,
transported, or participated in the storage of such wastes at the
facility, which was previously operated as a waste oil recycling
facility. These State District Court suits, which seek damages in
total amounts ranging from $1 million to $10 billion and are now
consolidated in a class action, and three federal suits in three states
other than Louisiana involving issues arising from the same facility,
have been removed and transferred, respectively, to the U.S. District
Court for the Middle District of Louisiana. No assurances can be given
to the timing or outcome of these suits.
(GSU)
A total of six suits have been filed on behalf of approximately
3,415 plantiffs in state and federal courts in Jefferson County, Texas.
These suits seek relief from GSU as well as numerous other defendants
for damages caused by the alleged exposure to hazardous waste and
asbestos on the defendants' premises. At least five other individual
suits have been filed in Beaumont against GSU and others, seeking
damages for alleged asbestos exposure. All of the plaintiffs in such
suits are also suing GSU and all other defendants on a conspiracy
count. It is not yet known how many of the plantiffs in the suits
discussed above worked on GSU's premises. There have been
approximately 55 asbestos-related law suits filed in the District Court
of Calcasieu Parish in Lake Charles, Louisiana, on behalf of an
aggregate of 119 plaintiffs naming numerous defendants including GSU,
and GSU expects additional cases to be filed. The suits allege that
each plaintiff contracted an asbestos-related disease from exposure to
asbestos insulation products on the premises of such defendants.
Settlements of the two largest of the Jefferson County suits (involving
about 1,660 groups of claimants) and 38 suits in Calcasieu Parish
(involving approximately 91 plantiffs) have been consummated. GSU was
named as one of a number of defendants in nearly all of the suits.
GSU's share of the settlements of these cases was not material to its
financial position or results of operations.
Cajun - River Bend Litigation (Entergy Corporation and GSU)
GSU has significant business relationships with Cajun, including
co-ownership of River Bend (operated by GSU) and Big Cajun 2, Unit 3
(operated by Cajun). GSU and Cajun, respectively, own 70% and 30%
undivided interests in River Bend and 42% and 58% undivided interests
in Big Cajun 2, Unit 3. Cajun is currently in reorganization
proceedings under the United States Bankruptcy Code.
In June 1989, Cajun filed a civil action against GSU in the United
States District Court for the Middle District of Louisiana (District
Court). Cajun's complaint seeks to annul, rescind, terminate and/or
dissolve the Joint Ownership Participation and Operating Agreement
(Operating Agreement) entered into on August 28, 1979 relating to
River Bend. Cajun alleges fraud and error by GSU, breach of its
fiduciary duties owed to Cajun and/or GSU's repudiation, renunciation,
abandonment or dissolution of its core obligations under the Operating
Agreement, as well as the lack or failure of cause and/or consideration
for Cajun's performance under the Operating Agreement. The suit also
seeks to recover Cajun's alleged $1.6 billion investment in the unit as
damages, plus attorneys' fees, interest, and costs. Two member
cooperatives of Cajun have brought an independent action to declare the
Operating Agreement void, based upon failure to get prior LPSC approval
alleged to be necessary. GSU believes the suits are without merit and
is contesting them vigorously.
A trial on the portion of the suit by Cajun to rescind the
Operating Agreement began in April 1994 and was completed in March
1995. On October 24, 1995, the District Court issued a memorandum
opinion ruling in favor of GSU. The District Court found that Cajun
did not prove that GSU fraudulently induced it to execute the Operating
Agreement and that Cajun failed to timely assert its claim. A final
judgment on this portion of the suit is not expected to be entered
until all claims asserted by Cajun have been heard. The trial of the
second portion of the suit currently is scheduled to begin on July 2,
1996. If GSU is ultimately unsuccessful in this litigation and is
required to pay substantial damages, GSU would probably be unable to
make such payments and could be forced to seek relief from its
creditors under the United States Bankruptcy Code. If GSU prevails in
this litigation, there can be no assurance that the United States
Bankruptcy Court will allow funding by Cajun of all required costs of
ownership in River Bend.
In the bankruptcy proceedings, Cajun filed a motion to reject the
Operating Agreement as a burdensome executory contract. GSU responded
on January 10, 1995, with a memorandum opposing Cajun's motion. If the
District Court were to grant Cajun's motion to reject the Operating
Agreement, Cajun would be relieved of its financial obligations under
the contract, while GSU would likely have a substantial damage claim
arising from any such rejection. Although GSU believes that Cajun's
motion to reject the Operating Agreement is without merit, it is not
possible to predict the outcome or ultimate impact of these
proceedings.
See Note 8 for additional information regarding the Cajun
litigation, Cajun's bankruptcy filing, related filings, and the ongoing
potential effects of these matters upon GSU.
As the result of an order issued by the District Court in August
1995, a former federal bankruptcy judge, Ralph Mabey, was appointed as
trustee to oversee Cajun in bankruptcy. The LPSC and Cajun appealed
the appointment of a trustee to the Fifth Circuit where the action of
the District Court was reversed and remanded for further proceedings.
However, in January 1996, the Fifth Circuit reversed its original
position and affirmed the appointment of the trustee.
In October 1995, the appeals court affirmed the District Court's
preliminary injunction in the Cajun litigation. The preliminary
injunction stipulated that GSU should make payments for its portion of
expenses for Big Cajun 2, Unit 3 into the registry of the District
Court. As of December 31, 1995, $38 million had been paid by GSU into
the registry of the District Court.
Cajun has not paid its full share of capital costs, operating and
maintenance expenses and other costs for repairs and improvements to
River Bend since 1992. However, Cajun continues to pay its share of
decommissioning costs for River Bend. Cajun's unpaid portion of River
Bend operating and maintenance expenses (including nuclear fuel) and
capital costs for 1995 was approximately $58.7 million. The cumulative
cost (excluding nuclear fuel) to GSU resulting from Cajun's failure to
pay its full share of River Bend-related costs, reduced by the proceeds
from the sale by GSU of Cajun's share of River Bend power and payments
for GSU's portion of expenses for Big Cajun 2, Unit 3 into the registry
of the District Court, was $31.1 million as of December 31, 1995. These
amounts are reflected in long-term receivables with an offsetting
reserve in other deferred credits. Cajun's bankruptcy may affect the
ultimate collectibility of the amounts owed to GSU, including any
amounts that may be awarded in litigation.
Cajun - Transmission Service (Entergy Corporation and GSU)
GSU and Cajun are parties to FERC proceedings relating to
transmission service charge disputes. See Note 8 for additional
information regarding these FERC proceedings, FERC orders issued as a
result of such proceedings and the potential effects of these
proceedings upon GSU.
On December 7, 1993, Cajun filed a complaint in the Middle
District of Louisiana alleging that GSU failed to provide Cajun an
opportunity to construct certain facilities that allegedly would have
reduced its rates under Service Schedule CTOC, and is seeking an order
compelling the conveyance of certain facilities and awarding
unspecified damages. GSU has moved to dismiss the complaint on the
basis, among others, that FERC has already addressed the matter in the
proceedings described in Note 8.
Service Area Dispute
(Entergy Corporation and GSU)
GSU was requested by Cajun and Jefferson Davis Electric
Cooperative, Inc. (Jefferson Davis), to provide the transmission of
power over GSU's system for delivery to an area near Lake Charles,
Louisiana. GSU provides electric service to industrial and other
customers in this area, and Cajun and Jefferson Davis do not. In
October 1989, Cajun filed a complaint at FERC contending that GSU
wrongfully refused to provide Cajun certain transmission services so
that its member, Jefferson Davis, could provide service to certain
industrial customers, and it requested FERC to order GSU to provide the
service. Subsequently, the FERC summarily dismissed Cajun's complaint,
but the D.C. Circuit reversed FERC's summary determination and remanded
the case to FERC for a hearing. Ultimately, in March 1994, the FERC
issued an order dismissing Cajun's complaint and finding that GSU
properly exercised its contractual right to refuse to provide
transmission service to Cajun. In August 1994, the FERC denied a
rehearing. Subsequently, Cajun filed a petition for review of the
FERC's orders in the D.C. Circuit. In October 1995, the D.C. Circuit
affirmed the FERC's previous opinion in its entirety.
Cajun and Jefferson Davis also brought a related action in federal
court in the Western District of Louisiana alleging that GSU breached
its obligations under the parties' contract and violated the antitrust
laws by refusing to provide the transmission service described above.
Cajun and Jefferson Davis seek an injunction requiring GSU to provide
the requested service and unspecified treble damages for GSU's refusal
to provide the service. In November 1989, the district court denied
Cajun's and Jefferson Davis' motion for a preliminary injunction. In
May 1991, the judge stayed the proceeding pending final resolution of
the matters still pending before FERC.
(Entergy Corporation and MP&L)
On October 11, 1994, twelve Mississippi cities filed a complaint
in state court against MP&L and eight electric power associations
seeking a judgment from the court declaring unconstitutional certain
Mississippi statutes that establish the procedure that must be followed
before a municipality can acquire the facilities and certificate rights
of a utility serving in the municipality. Specifically, the suit
requests that the court declare unconstitutional certain 1987
amendments to the Mississippi Public Utilities Act that require that
the MPSC cancel a utility's certificate to serve in the municipality
before a municipality may acquire a utility's facilities located in the
municipality. The suit also requests that the court find that
Mississippi municipalities can serve any consumer in the boundaries of
the municipality and within one mile thereof. On January 6, 1995, MP&L
and the other defendants filed motions to dismiss. In October 1995,
the state court dismissed the complaint. The plaintiffs have appealed
the dismissal to the Mississippi Supreme Court.
Cajun/River Bend Repairs (Entergy Corporation and GSU)
In December 1991, Cajun filed a complaint seeking declaratory and
injunctive relief from the U. S. District Court for the Middle District
of Louisiana. The complaint concerns GSU's position that Cajun has
defaulted on the payment of its share of certain expenditures to repair
corrosion damage in the service water system, to repair a feedwater
nozzle crack and to repair a turbine rotor. Cajun alleges that it has
no obligation to pay its share of such costs and seeks a declaration
that it may elect not to participate in the funding of such costs and
that GSU may not demand payment or attempt to implement default
provisions in the Operating Agreement. Cajun alleges that if it is
required to pay its share of such costs it would be forced to default
on other obligations. See "Cajun - River Bend" above for information
regarding Cajun's bankruptcy filing. GSU believes that Cajun is in
default under the provisions of the Operating Agreement. No assurance
can be given as to the outcome or timing of this action brought by
Cajun.
Taxes Paid Under Protest (Entergy Corporation and LP&L)
Since the mid-1980's, LP&L and the tax authorities of St. Charles
Parish, Louisiana (Parish), the parish in which Waterford 3 is located,
have disputed use taxes paid on nuclear fuel ($4.9 million through
1989) under protest by LP&L. LP&L continues to be successful in
lawsuits in the Parish with regard to recovering these taxes, plus
interest, and also with regard to Parish lease tax issues pertaining to
fuel financing arrangements. In October 1994, Parish tax authorities
sued LP&L and Entergy Corporation in the Civil District Court of
Orleans Parish, Louisiana, claiming that $1.4 million of sales and use
and lease taxes paid under protest by LP&L with respect to newly
acquired nuclear fuel were not, in fact, paid under protest, and that
unspecified additional taxes, interest, and penalties are due.
Subsequently, the suit filed by the Parish tax authorities was
dismissed. In September 1995, LP&L similarly paid use tax under
protest in the amount of $209,000 with regard to the delivery of a new
batch of fuel. In June 1995, LP&L received a favorable decision from
the Louisiana Fifth Circuit Court of Appeals that confirmed that no
such use taxes are due. The Parish and LP&L are currently discussing a
possible settlement of all pending tax-related litigation including the
likely return of the amounts paid under protest in October 1994 and
September 1995. The suits by LP&L with regard to state use tax paid
under protest on nuclear fuel are still pending.
Federal Income Tax Audit (Entergy Corporation, LP&L, and System Energy)
In August 1994, Entergy received an IRS report covering the
federal income tax audit of Entergy Corporation and subsidiaries for
the years 1988 - 1990. The report asserts an $80 million tax
deficiency for the 1990 consolidated federal income tax returns related
primarily to the application of accelerated investment tax credits
associated with Waterford 3 and Grand Gulf nuclear plants. Entergy
Corporation believes there is no material tax deficiency and is
vigorously contesting the proposed assessment.
Panda Energy Corporation Complaint (Entergy Corporation)
Panda Energy Corporation (Panda) has commenced litigation in the
Dallas District Court naming Entergy Corporation, Energy Enterprises,
Entergy Power, Entergy Power Asia, Ltd., and Entergy Power Development
Corporation as defendants. The allegations against the defendants
include, among others, tortious interference with contractual
relations, conspiracy, misappropriation of corporate opportunity,
unfair competition and fraud, and constructive trust issues. Panda
seeks damages of approximately $4.8 billion, of which $3.6 billion is
claimed in punitive damages. Entergy believes that this lawsuit is
without merit, that the damages claimed are insupportable, and that
some or all of the claims against Entergy will be dismissed. However,
no assurance can be given as to the timing or outcome of this matter.
Catalyst Technologies, Inc. (Entergy Corporation)
In June 1993 Catalyst Technologies, Inc. (CTI) filed a petition
against Electec, Inc. (Electec), the predecessor to Entergy
Enterprises. Prior to the filing of the petition, CTI and Electec
entered into an agreement whereby CTI was required to raise a specified
amount of funding in exchange for the right to acquire Electec's
computer software technology marketing rights. CTI alleges that due to
actions of Electec, it was unable to secure the necessary funding, and
therefore, was not able to meet the terms of the agreement. The
petition alleges breach of contract, breach of the obligation of good-
faith and fair dealing, and bad-faith breach of contract against
Electec. Subsequent to the filing of the petition, CTI indicated that
it is seeking to recover approximately $36 million from Entergy
Enterprises. No trial date has been set at this time. No assurance
can be given as to the timing or outcome of this matter.
EARNINGS RATIOS OF OPERATING COMPANIES AND SYSTEM ENERGY
The Operating Companies and System Energy's ratios of earnings to
fixed charges and ratios of earnings to fixed charges and preferred
dividends pursuant to Item 503 of SEC Regulation S-K are as follows:
<TABLE>
<CAPTION>
Ratios of Earnings to Fixed Charges
Years Ended December 31,
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
AP&L 2.25 2.28 3.11 (c) 2.32 2.56
GSU 1.56 1.72 1.54 .36 (d) 1.86
LP&L 2.40 2.79 3.06 2.91 3.18
MP&L 2.36 2.37 3.79 (c) 2.12 2.92
NOPSI 5.66 (b) 2.66 4.68 (c) 1.91 3.93
System Energy 1.74 2.04 1.87 1.23 2.07
</TABLE>
<TABLE>
<CAPTION>
Ratios of Earnings to Combined Fixed Charges and
Preferred Dividends
Years Ended December 31,
<S> <C> <C> <C> <C> <C>
1991 1992 1993 1994 1995
AP&L 1.87 1.86 2.54 (c) 1.97 2.12
GSU (a) 1.19 1.37 1.21 .29 (d) 1.54
LP&L 1.95 2.18 2.39 2.43 2.60
MP&L 1.94 1.97 3.08 (c) 1.81 2.51
NOPSI 4.97 (b) 2.36 4.12 (c) 1.73 3.56
</TABLE>
(a) "Preferred Dividends" in the case of GSU also include dividends on
preference stock.
(b) Earnings for the year ended December 31, 1991, include the $90
million effect of the 1991 NOPSI Settlement.
(c) Earnings for the year ended December 31, 1993, include
approximately $81 million, $52 million, and $18 million for AP&L,
MP&L, and NOPSI, respectively, related to the change in accounting
principle to provide for the accrual of estimated unbilled
revenues.
(d) Earnings for the year ended December 31, 1994, for GSU were not
adequate to cover fixed charges and combined fixed charges and
preferred dividends by $144.8 million and $197.1 million,
respectively.
INDUSTRY SEGMENTS
NOPSI
Narrative Description of NOPSI Industry Segments
Electric Service
NOPSI supplied retail electric service to 190,332 customers as of
December 31, 1995. During 1995, 39% of electric operating revenues
was derived from residential sales, 40% from commercial sales, 6% from
industrial sales, and 15% from sales to governmental and municipal
customers.
Natural Gas Service
NOPSI supplied retail natural gas service to 153,370 customers as
of December 31, 1995. During 1995, 56% of gas operating revenues was
derived from residential sales, 19% from commercial sales, 9% from
industrial sales, and 16% from sales to governmental and municipal
customers. (See "FUEL SUPPLY - Natural Gas Purchased for Resale.")
Selected Financial Information Relating to Industry Segments
For selected financial information relating to NOPSI's industry
segments, see NOPSI's financial statements and Note 14.
Employees by Segment
NOPSI's full-time employees by industry segment as of December 31,
1995, were as follows:
Electric 378
Natural Gas 111
---
Total 489
===
(For further information with respect to NOPSI's segments, see
"PROPERTY.")
GSU
For the year ended December 31, 1995, 96% of GSU's operating
revenues was derived from the electric utility business. Of the
remaining operating revenues 3% was derived from the steam business and
1% from the natural gas business.
<PAGE>
PROPERTY
Generating Stations
The total capability of the System's owned and leased generating
stations as of December 31, 1995, by company and by fuel type, is
indicated below:
<TABLE>
<CAPTION>
Owned and Leased Capability MW(1)
---------------------------------------------------
Gas
Turbine
and
Internal
Company Total Fossil Nuclear Combustion Hydro
- - - - ------------- ------- ------- -------- --------- ----
<S> <C> <C> <C> <C> <C>
AP&L 4,373 (2) 2,379 1,694 230 (4) 70
GSU 6,558 (2) 5,828 655 75 -
LP&L 5,423 (2) 4,329 1,075 19 -
MP&L 3,063 (2) 3,052 - 11 -
NOPSI 934 (2) 918 - 16 -
System Energy 1,051 - 1,051 - -
------- ------- -------- --------- ----
Total System 21,402 (3) 16,506 (3) 4,475 351 70
========= ======== ========= ========= =====
</TABLE>
(1) "Owned and Leased Capability" is the dependable load carrying
capability as demonstrated under actual operating conditions based
on the primary fuel (assuming no curtailments) that each station
was designed to utilize.
(2) Excludes the capacity of fossil-fueled generating stations placed
on extended reserve as follows: AP&L - 506 MW; GSU - 405 MW; LP&L
- 157 MW; MP&L - 73 MW; and NOPSI - 143 MW. Generating stations
that are not expected to be utilized in the near-term to meet load
requirements are placed in extended reserve shutdown in order to
minimize operating expenses.
(3) Excludes net capability of generating facilities owned by Entergy
Power, which owns 809 MW of fossil-fueled capacity.
(4) Includes 188 MW of capacity leased by AP&L through 1999.
Load and capacity projections are regularly reviewed in order to
coordinate and recommend the location and time of installation of
additional generating capacity and of interconnections in light of the
availability of power, the location of new loads, and maximum economy
to the System. Based on load and capability projections and bulk power
availability, the System has no current need to install additional
generating capacity. When new generation resources are needed, the
System plans to meet this need with a variety of sources other than
construction of new base load generating capacity. In the meantime,
the System will meet capacity needs by, among other things, purchasing
power in the wholesale power market and/or removing generating stations
from extended reserve shutdown.
Under the terms of the System Agreement, certain generating
capacity and other power resources are shared among the Operating
Companies. Among other things, the System Agreement provides that
parties having generating capacity greater than their load requirements
(long companies) shall sell receive payments from those parties having
deficiencies in generating capacity (short companies) and an amount
sufficient to cover certain of the long companies' costs, including
operating expenses, fixed charges on debt, dividend requirements on
preferred and preference stock, and a fair rate of return on common
equity investment. Under the System Agreement, these charges are based
on costs associated with the long companies' steam electric generating
units fueled by oil or gas. In addition, for all energy exchanged
among the Operating Companies under the System Agreement, the short
companies are required to pay the cost of fuel consumed in generating
such energy plus a charge to cover other associated costs (see "RATE
MATTERS AND REGULATION - Rate Matters - Wholesale Rate Matters - System
Agreement," above, for a discussion of FERC proceedings relating to the
System Agreement).
The System's business is subject to seasonal fluctuations, with
the peak period occurring in the summer months. The System's 1995 (and
all-time) peak demand of 19,590 MW occurred on August 16, 1995. The
net System capability at the time of peak was 21,100 MW, net of off-
system firm sales of 302 MW. The capacity margin at the time of the
peak was approximately 7.2%, excluding units placed on extended reserve
and capacity owned by Entergy Power.
Interconnections
The electric power supply facilities of Entergy consist
principally of steam-electric production facilities strategically
located with reference to availability of fuel, protection of local
loads, and other controlling economic factors. These are
interconnected by a transmission system operating at various voltages
up to 500 kilovolts. Generally, with the exception of Grand Gulf 1,
Entergy Power's capacity and a small portion of MP&L's capacity,
operating facilities or interests therein are owned by the System
operating company serving the area in which the facilities are located.
However, all of the System's generating facilities are centrally
dispatched and operated in order to obtain the lowest cost sources of
energy with a minimum of investment and the most efficient use of
plant.
In addition to the many neighboring utilities with which the
Operating Companies interconnect, the Operating Companies are members
of the Southwest Power Pool, the primary purpose of which is to ensure
the reliability and adequacy of the electric bulk power supply in the
southwest region of the United States. The Southwest Power Pool is a
member of the North American Electric Reliability Council. The
Operating Companies are also members of the Western Systems Power Pool.
Gas Property
As of December 31, 1995, NOPSI distributed and transported natural
gas for distribution solely within the limits of the City of New
Orleans through a total of 1,421 miles of gas distribution mains and 40
miles of gas transmission lines. Koch Gateway Pipeline Company is a
principal supplier of natural gas to NOPSI, delivering to 6 of NOPSI's
14 delivery points.
As of December 31, 1995, the gas properties of GSU were not
material to GSU.
Titles
The System's generating stations are generally located on
properties owned in fee simple. The greater portion of the
transmission and distribution lines of the Operating Companies has been
constructed over property of private owners pursuant to easements or on
public highways and streets pursuant to appropriate franchises. The
rights of each Operating Company in the realty on which its facilities
are located are considered by it to be adequate for its use in the
conduct of its business. Minor defects and irregularities customarily
found in properties of like size and character exist, but such defects
and irregularities do not materially impair the use of the properties
affected thereby. The Operating Companies generally have the right of
eminent domain, whereby they may, if necessary, perfect or secure
titles to, or easements or servitudes on, privately-held lands used or
to be used in their utility operations.
Substantially all the physical properties owned by each Operating
Company and System Energy, respectively, are subject to the lien of a
mortgage and deed of trust securing the first mortgage bonds of such
company. The Lewis Creek generating station is owned by GSG&T, Inc.,
and is not subject to the lien of the GSU mortgage securing the first
mortgage bonds of GSU, but is leased to and operated by GSU. In the
case of LP&L, certain properties are also subject to the liens of
second mortgages securing other obligations of LP&L. In the case of
MP&L and NOPSI, substantially all of their properties and assets are
also subject to the second mortgage lien of their respective general
and refunding mortgage bond indentures.
FUEL SUPPLY
Entergy's sources of generation and average fuel cost per KWh,
excluding Entergy Power, for the years 1993-1995 were:
<TABLE>
<CAPTION>
Natural Fuel Nuclear Coal
Gas Oil Fuel
% Cents % Cents % Cents % Cents
of per of per of Per of Per
Year Gen KWh Gen KWh Gen KWh Gen KWh
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1995 50 1.99 - - 35 .60 15 1.73
1994 44 2.24 1 3.99 39 .60 16 1.82
1993- 27 2.70 7 2.10 51 .58 15 1.91
Entergy
(excluding
GSU)
1993 - GSU 69 2.44 - - 14 1.19 17 1.77
</TABLE>
The System's actual 1995 and projected 1996 sources of generation,
excluding Entergy Power, are:
<TABLE>
<CAPTION>
Natural Fuel Nuclear Coal
Gas Oil
1995 1996 1995 1996 1995 1996 1995 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C>
System 50% 46% - - 35% 36% 15% 18%
AP&L 9 8 - - 55 48 35 43
GSU 69 76 - - 18 16 13 8
LP&L 63 57 - - 37 43 - -
MP&L 72 70 1 - - - 27 30
NOPSI 100 100 - - - - - -
System - - - - 100(a) 100(a) - -
Energy
</TABLE>
(a)Capacity and energy from System Energy's interest in Grand Gulf 1
is allocated as follows: AP&L - 36%; LP&L - 14%; MP&L - 33%; and
NOPSI - 17%.
The balance of generation, which was immaterial, was provided by
hydroelectric power.
Natural Gas
The Operating Companies have long-term firm and short-term
interruptible gas contracts. Long-term firm contracts comprise less
than 40% of total System requirements but can be called upon, if
necessary, to satisfy a significant percentage of the System's needs.
Additional gas requirements are satisfied by short-term contracts and
spot-market purchases. GSU has a transportation service agreement with
a gas supplier that provides flexible natural gas service to certain
generating stations by using such supplier's pipeline and gas storage
facility.
Many factors, including wellhead deliverability, storage and
pipeline capacity, and demand requirements of end users influence the
availability and price of natural gas supplies for power plants.
Demand is tied to regional weather conditions as well as to the prices
of other energy sources. Supplies of natural gas are expected to be
adequate in 1996. However, pursuant to federal and state regulations,
gas supplies to power plants may be interrupted during periods of
shortage. To the extent natural gas supplies may be disrupted, the
Operating Companies will use alternate fuels, such as oil, or rely on
coal and nuclear generation.
Coal
AP&L has long-term contracts with mines in the State of Wyoming
for the supply of low-sulfur coal for the White Bluff Steam Electric
Generating Station and Independence. These contracts, which expire in
2002 and 2011, provide for approximately 85% of AP&L's expected annual
coal requirements. Additional requirements are satisfied by annual
spot market purchases. GSU has a contract for a supply of low-sulfur
Wyoming coal for Nelson Unit 6, which should be sufficient to satisfy
the fuel requirements at Nelson Unit 6 through 2004. Cajun has advised
GSU that it has contracts that should provide an adequate supply of
coal until 1999 for the operation of Big Cajun 2, Unit 3.
Nuclear Fuel
The nuclear fuel cycle involves the mining and milling of uranium
ore to produce a concentrate, the conversion of uranium concentrate to
uranium hexafluoride gas, enrichment of that gas, fabrication of
nuclear fuel assemblies for use in fueling nuclear reactors, and
disposal of the spent fuel.
System Fuels is responsible for contracts to acquire nuclear
material to be used in fueling AP&L's, LP&L's, and System Energy's
nuclear units and maintaining inventories of such materials during the
various stages of processing. Each of these companies contracts for
the fabrication of its own nuclear fuel and purchases the required
enriched uranium hexafluoride from System Fuels. The requirements for
GSU's River Bend plant are covered by contracts made by GSU. Entergy
Operations acts as agent for System Fuels and GSU in negotiating and/or
administering nuclear fuel contracts.
In October 1989, System Fuels entered into a revolving credit
agreement with a bank that provides up to $45 million in borrowings to
finance its nuclear materials and services inventory. Should System
Fuels default on its obligations under its credit agreement, AP&L,
LP&L, and System Energy have agreed to purchase nuclear materials and
services under the agreement.
Based upon the planned fuel cycles for the System's nuclear units,
the following tabulation shows the years through which existing
contracts and inventory will provide materials and services:
<TABLE>
<CAPTION>
Acquisition
of or
Conversion
to Spent
Uranium Uranium Enrich- Fabri- Fuel
Concentrate Hexafluoride ment cation Disposal
<S> <C> <C> <C> <C> <C>
ANO 1 (1) (1) (2) 1997 (3)
ANO 2 (1) (1) (2) 1999 (3)
River Bend (1) (1) (2) 2000 (3)
Waterford 3 (1) (1) (2) 1999 (3)
Grand Gulf 1 (1) (1) (2) 2000 (3)
</TABLE>
(1) Current contracts will provide a significant percentage of these
materials and services through termination dates ranging from
1996-1999. Additional materials and services required beyond
these dates are estimated to be available for the foreseeable
future.
(2) Current contracts will provide a significant percentage of these
materials and services through approximately 2000.
(3) The Nuclear Waste Policy Act of 1982 provides for the disposal of
spent nuclear fuel or high level waste by the DOE.
The System will enter into additional arrangements to acquire
nuclear fuel beyond the dates shown above. Except as noted above,
Entergy cannot predict the ultimate availability or cost of such
arrangements at this time.
AP&L, GSU, LP&L, and System Energy currently have arrangements to
lease nuclear fuel and related equipment and services in aggregate
amounts up to $130 million, $70 million, $80 million, and $80 million,
respectively. As of December 31, 1995, the unrecovered cost base of
AP&L's, GSU's, LP&L's, and System Energy's nuclear fuel leases amounted
to approximately $98.7 million, $69.9 million, $72.9 million, and
$71.4 million, respectively. The lessors finance the acquisition and
ownership of nuclear fuel through credit agreements and the issuance of
notes. These agreements are subject to annual renewal with, in LP&L's
and GSU's case, the consent of the lenders. The credit agreements for
AP&L, GSU, LP&L, and System Energy have been extended and now have
termination dates of December 1998, December 1998, January 1999, and
February 1999, respectively. The debt securities issued pursuant to
these fuel lease arrangements have varying maturities through January
31, 1999. It is expected that the credit agreements will be extended
or alternative financing will be secured by each lessor upon the
maturity of the current arrangements. If extensions or alternative
financing cannot be arranged, the lessee in each case must purchase
sufficient nuclear fuel to allow the lessor to retire such borrowings.
Natural Gas Purchased for Resale
NOPSI has several suppliers of natural gas for resale. Its system
is interconnected with three interstate and three intrastate pipelines.
Presently, NOPSI's primary suppliers are Koch Gas Services Company
(KGS), an interstate gas marketer, and Bridgeline and Pontchartrain,
intrastate pipelines. NOPSI has a firm gas purchase contract with KGS.
The KGS gas supply is transported to NOPSI pursuant to a "No-Notice"
transportation service agreement with Koch Gateway Pipeline Company
(KGPC). This service is subject to FERC-approved rates. NOPSI has
firm contracts with its two intrastate suppliers and also makes
interruptible spot market purchases. In recent years, natural gas
deliveries have been subject primarily to weather-related curtailments.
However, NOPSI has experienced no such curtailments.
After the implementation of FERC-mandated interstate pipeline
restructuring in 1993, curtailments of interstate gas supply could
occur if NOPSI's suppliers failed to perform their obligations to
deliver gas under their supply agreements. KGPC could curtail
transportation capacity only in the event of pipeline system
constraints. Based on the current supply of natural gas, and absent
extreme weather-related curtailments, NOPSI does not anticipate any
interruptions in natural gas deliveries to its customers.
GSU purchases natural gas for resale under a "No-Notice" type of
agreement from Mid Louisiana Gas Company. Abandonment of service by
the present supplier would be subject to abandonment proceedings by
FERC.
Research
AP&L, GSU, LP&L, MP&L, and NOPSI are members of the Electric Power
Research Institute (EPRI). EPRI conducts a broad range of research in
major technical fields related to the electric utility industry.
Entergy participates in various EPRI projects based on Entergy's needs
and available resources. During 1995, 1994, and 1993, the System
contributed approximately $9 million, $18 million, and $17 million,
respectively, for the various research programs in which Entergy was
involved.
Item 2. Properties
Refer to Item 1. "Business - PROPERTY," for information regarding
the properties of the registrants.
Item 3. Legal Proceedings
Refer to Item 1. "Business - RATE MATTERS AND REGULATION," for
details of the registrants' material rate proceedings and other
regulatory proceedings and litigation that are pending or that
terminated in the fourth quarter of 1995.
Item 4. Submission of Matters to a Vote of Security Holders
During the fourth quarter of 1995, no matters were submitted to a
vote of the security holders of Entergy Corporation, AP&L, GSU, LP&L,
MP&L, NOPSI, or System Energy.
PART II
Item 5. Market for Registrants' Common Equity and Related Stockholder
Matters
Entergy Corporation
The shares of Entergy Corporation's common stock are listed on the
New York, Chicago, and Pacific Stock Exchanges.
The high and low prices of Entergy Corporation's common stock for
each quarterly period in 1995 and 1994 were as follows:
<TABLE>
<CAPTION>
1995 1994
High Low High Low
(In Dollars)
<S> <C> <C> <C> <C>
First 24 3/4 20 37 3/8 31 1/8
Second 25 3/8 21 32 1/8 24 5/8
Third 26 1/8 23 3/4 26 1/4 22 5/8
Fourth 29 1/4 26 1/4 24 3/4 21 1/4
</TABLE>
Dividends of 45 cents per share were paid on Entergy Corporation's
common stock in each of the quarters of 1995 and 1994.
As of February 29, 1996, there were 98,911 stockholders of record
of Entergy Corporation.
For information with respect to Entergy Corporation's future
ability to pay dividends, refer to Note 7, "DIVIDEND RESTRICTIONS." In
addition to the restrictions described in Note 7, PUHCA provides that,
without approval of the SEC, the unrestricted, undistributed retained
earnings of any Entergy Corporation subsidiary are not available for
distribution to Entergy Corporation's common stockholders until such
earnings are made available to Entergy Corporation through the
declaration of dividends by such subsidiaries.
AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy
There is no market for the common stock of Entergy Corporation's
subsidiaries as all shares are owned by Entergy Corporation. Cash
dividends on common stock paid by the subsidiaries to Entergy
Corporation during 1995 and 1994, were as follows:
<TABLE>
<CAPTION>
1995 1994
(In Millions)
<S> <C> <C>
AP&L $153.4 $80.0
GSU -- $289.1
LP&L $221.5 $167.1
MP&L $61.7 $45.6
NOPSI $30.6 $33.3
System Energy $92.8 $148.3
Entergy S.A. $3.5 --
Entergy Transener $2.1 --
</TABLE>
In February 1996, Entergy Corporation received common stock
dividend payments from its subsidiaries totaling $48.7 million. For
information with respect to restrictions that limit the ability of
System Energy and the Operating Companies to pay dividends, see Note 7.
Item 6. Selected Financial Data
Entergy Corporation. Refer to information under the heading
"ENTERGY CORPORATION AND SUBSIDIARIES SELECTED FINANCIAL DATA - FIVE-
YEAR COMPARISON."
AP&L. Refer to information under the heading "ARKANSAS POWER &
LIGHT COMPANY SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
GSU. Refer to information under the heading "GULF STATES UTILITIES
COMPANY SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
LP&L. Refer to information under the heading "LOUISIANA POWER &
LIGHT COMPANY SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
MP&L. Refer to information under the heading "MISSISSIPPI POWER &
LIGHT COMPANY SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
NOPSI. Refer to information under the heading "NEW ORLEANS PUBLIC
SERVICE INC. SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
System Energy. Refer to information under the heading "SYSTEM
ENERGY RESOURCES, INC. SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON."
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Entergy Corporation and Subsidiaries. Refer to information under
the heading "ENTERGY CORPORATION AND SUBSIDIARIES MANAGEMENT'S
FINANCIAL DISCUSSION AND ANALYSIS - LIQUIDITY AND CAPITAL RESOURCES," "
- - - - - SIGNIFICANT FACTORS AND KNOWN TRENDS," and "- RESULTS OF OPERATIONS."
AP&L. Refer to information under the heading "ARKANSAS POWER &
LIGHT COMPANY MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS - RESULTS
OF OPERATIONS."
GSU. Refer to information under the heading "GULF STATES
UTILITIES COMPANY MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
RESULTS OF OPERATIONS."
LP&L. Refer to information under the heading "LOUISIANA POWER &
LIGHT COMPANY MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS - RESULTS
OF OPERATIONS."
MP&L. Refer to information under the heading "MISSISSIPPI POWER &
LIGHT COMPANY MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS - RESULTS
OF OPERATIONS."
NOPSI. Refer to information under the heading "NEW ORLEANS PUBLIC
SERVICE INC. MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS - RESULTS
OF OPERATIONS."
System Energy. Refer to information under the heading "SYSTEM
ENERGY RESOURCES, INC. MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
RESULTS OF OPERATIONS."
Item 8. Financial Statements and Supplementary Data.
INDEX TO FINANCIAL STATEMENTS
Entergy Corporation and Subsidiaries:
Report of Management 44
Audit Committee Chairperson's Letter 45
Management's Financial Discussion and Analysis for Entergy 46
Corporation and Subsidiaries
Report of Independent Accountants for Entergy Corporation 55
and Subsidiaries
Independent Auditors' Report for Entergy Corporation and 56
Subsidiaries
Management's Financial Discussion and Analysis for Entergy 57
Corporation and Subsidiaries
Statements of Consolidated Income For the Years Ended December
31, 1995, 1994, and 1993 for Entergy Corporation and 59
Subsidiaries
Statements of Consolidated Cash Flows For the Years Ended
December 31, 1995, 1994, and 1993 for Entergy Corporation and 60
Subsidiaries
Balance Sheets, December 31, 1995 and 1994 for Entergy 62
Corporation and Subsidiaries
Statements of Consolidated Retained Earnings and Paid-In
Capital for the Years Ended December 31, 1995, 1994, and 1993 64
for Entergy Corporation and Subsidiaries
Selected Financial Data - Five-Year Comparison for Entergy 65
Corporation and Subsidiaries
Report of Independent Accountants for Arkansas Power & Light 66
Company
Independent Auditors' Report for Arkansas Power & Light 67
Company
Management's Financial Discussion and Analysis for Arkansas 68
Power & Light Company
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for Arkansas Power & Light Company 70
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for Arkansas Power & Light Company 71
Balance Sheets, December 31, 1995 and 1994 for Arkansas 72
Power & Light Company
Statements of Retained Earnings for the Years Ended December
31, 1995, 1994, and 1993 for Arkansas Power & Light Company 74
Selected Financial Data - Five-Year Comparison for Arkansas 75
Power & Light Company
Report of Independent Accountants for Gulf States Utilities 76
Company
Management's Financial Discussion and Analysis for Gulf 78
States Utilities Company
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for Gulf States Utilities Company 80
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for Gulf States Utilities Company 81
Balance Sheets, December 31, 1995 and 1994 for Gulf States 82
Utilities Company
Statements of Retained Earnings and Paid-In Capital for the
Years Ended December 31, 1995, 1994, and 1993 for Gulf States 84
Utilities Company
Selected Financial Data - Five-Year Comparison for Gulf 85
States Utilities Company
Report of Independent Accountants for Louisiana Power & 86
Light Company
Independent Auditors' Report for Louisiana Power & Light 87
Company
Management's Financial Discussion and Analysis for Louisiana 88
Power & Light Company
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for Louisiana Power & Light Company 90
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for Louisiana Power & Light Company 91
Balance Sheets, December 31, 1995 and 1994 for Louisiana 92
Power & Light Company
Statements of Retained Earnings for the Years Ended December
31, 1995, 1994, and 1993 for Louisiana Power & Light Company 94
Selected Financial Data - Five-Year Comparison for Louisiana 95
Power & Light Company
Report of Independent Accountants for Mississippi Power & 96
Light Company
Independent Auditors' Report for Mississippi Power & Light 97
Company
Management's Financial Discussion and Analysis for 98
Mississippi Power & Light Company
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for Mississippi Power & Light Company 100
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for Mississippi Power & Light Company 101
Balance Sheets, December 31, 1995 and 1994 for Mississippi 102
Power & Light Company
Statements of Retained Earnings for the Years Ended December
31, 1995, 1994, and 1993 for Mississippi Power & Light Company 104
Selected Financial Data - Five-Year Comparison for 105
Mississippi Power & Light Company
Report of Independent Accountants for New Orleans Public 106
Service Inc.
Independent Auditors' Report for New Orleans Public Service 107
Inc.
Management's Financial Discussion and Analysis for New 108
Orleans Public Service Inc.
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for New Orleans Public Service Inc. 110
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for New Orleans Public Service Inc. 111
Balance Sheets, December 31, 1995 and 1994 for New Orleans 112
Public Service Inc.
Statements of Retained Earnings for the Years Ended December
31, 1995, 1994, and 1993 for New Orleans Public Service Inc. 114
Selected Financial Data - Five-Year Comparison for New 115
Orleans Public Service Inc.
Report of Independent Accountants for System Energy 116
Resources, Inc.
Independent Auditors' Report for System Energy Resources, 117
Inc.
Management's Financial Discussion and Analysis for System 119
Energy Resources, Inc.
Statements of Income For the Years Ended December 31, 1995,
1994, and 1993 for System Energy Resources, Inc. 120
Statements of Cash Flows For the Years Ended December 31,
1995, 1994, and 1993 for System Energy Resources, Inc. 121
Balance Sheets, December 31, 1995 and 1994 for System Energy 122
Resources, Inc.
Statements of Retained Earnings for the Years Ended December
31, 1995, 1994, and 1993 for System Energy Resources, Inc. 124
Selected Financial Data - Five-Year Comparison for System 125
Energy Resources, Inc..
Notes to Financial Statements for Entergy Corporation and 126
Subsidiaries
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
REPORT OF MANAGEMENT
The management of Entergy Corporation and Subsidiaries has
prepared and is responsible for the financial statements and related
financial information included herein. The financial statements are
based on generally accepted accounting principles. Financial
information included elsewhere in this report is consistent with the
financial statements.
To meet its responsibilities with respect to financial
information, management maintains and enforces a system of internal
accounting controls that is designed to provide reasonable assurance,
on a cost-effective basis, as to the integrity, objectivity, and
reliability of the financial records, and as to the protection of
assets. This system includes communication through written policies
and procedures, an employee Code of Conduct, and an organizational
structure that provides for appropriate division of responsibility and
the training of personnel. This system is also tested by a
comprehensive internal audit program.
The independent public accountants provide an objective assessment
of the degree to which management meets its responsibility for fairness
of financial reporting. They regularly evaluate the system of internal
accounting controls and perform such tests and other procedures as they
deem necessary to reach and express an opinion on the fairness of the
financial statements.
Management believes that these policies and procedures provide
reasonable assurance that its operations are carried out with a high
standard of business conduct.
/s/Ed Lupberger /s/Gerald D. McInvale
ED LUPBERGER GERALD D. MCINVALE
Chairman, President, and Chief Executive Vice President and
Executive Officer of Entergy Chief Financial Officer
Corporation, AP&L, GSU, LP&L, MP&L and
NOPSI
/s/Donald C. Hintz
DONALD C. HINTZ
President and Chief Executive Officer of System Energy
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
AUDIT COMMITTEE CHAIRPERSON'S LETTER
The Entergy Corporation Board of Directors' Audit Committee is
comprised of four directors who are not officers of Entergy
Corporation: Lucie J. Fjeldstad, Chairperson, Dr. Norman C. Francis,
James R. Nichols, and H. Duke Shackelford. The committee held four
meetings during 1995.
The Audit Committee oversees Entergy Corporation's financial
reporting process on behalf of the Board of Directors and provides
reasonable assurance to the Board that sufficient operating,
accounting, and financial controls are in existence and are adequately
reviewed by programs of internal and external audits.
The Audit Committee discussed with Entergy's internal auditors and
the independent public accountants (Coopers & Lybrand L.L.P.) the
overall scope and specific plans for their respective audits, as well
as Entergy Corporation's financial statements and the adequacy of
Entergy Corporation's internal controls. The committee met, together
and separately, with Entergy's internal auditors and independent public
accountants, without management present, to discuss the results of
their audits, their evaluation of Entergy Corporation's internal
controls, and the overall quality of Entergy Corporation's financial
reporting. The meetings also were designed to facilitate and encourage
private communication between the committee and the internal auditors
and independent public accountants.
/s/Lucie J. Fjeldstad
LUCIE J. FJELDSTAD
Chairperson, Audit Committee
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
LIQUIDITY AND CAPITAL RESOURCES
Entergy, AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy
Cash Flows
Entergy is involved in capital-intensive businesses, which require
large investments in long-lived assets. While capital expenditures for
the construction of new generating capacity are not currently planned,
the System does require significant capital resources for the periodic
maturity of debt and preferred stock, ongoing construction
expenditures, and increasing investments in domestic and foreign energy-
related businesses. Net cash flow from operations totaled $1.397
billion, $1.538 billion, and $1.074 billion in 1995, 1994, and 1993,
respectively. Net cash flow from operations for the Operating
Companies and System Energy was as follows:
<TABLE>
<CAPTION>
1995 1994 1993
--------- --------- ---------
(In Millions)
<S> <C> <C> <C>
AP&L $ 338 $ 356 $ 346
GSU $ 401 $ 326 $ 255
LP&L $ 385 $ 368 $ 300
MP&L $ 185 $ 195 $ 149
NOPSI $ 99 $ 39 $ 70
System Energy $ 96 $ 337 $ 318
</TABLE>
In 1995, AP&L's net cash flow from operations decreased because of
increases in customer accounts receivables due to increased 1995 sales
and the replenishment of coal inventory which was depleted in 1994.
This decrease was partially offset by lower other operation and
maintenance expense. GSU's net cash flow from operations increased in
1995 due to higher revenues and lower operation and maintenance
expenses. This increase was partially offset by a Texas retail rate
refund, recorded in 1994 and paid in 1995. LP&L's net cash flow from
operations increased in 1995 as a result of lower operation and
maintenance expenses partially offset by a rate reduction in April
1995. MP&L's net cash flow from operations decreased in 1995 because
of increased accounts receivable balances due to increased 1995 sales,
partially offset by lower other operation and maintenance expenses.
NOPSI's net cash flow from operations was higher in 1995 than 1994
because refunds that were made in 1994 as a result of the NOPSI
settlement did not impact 1995 cash flow. Lower operation and
maintenance expenses in 1995 for NOPSI also contributed to the
increase. System Energy's net cash flow from operations decreased in
1995 due to refunds made to associated companies in 1995 as the result
of a 1994 FERC audit settlement, and higher income tax payments in
1995.
Financing Sources
In recent years, cash flows of the Operating Companies,
supplemented by cash on hand, have been sufficient to meet
substantially all investing and financing requirements, including
capital expenditures, dividends and debt/preferred stock maturities.
Entergy's ability to fund these capital requirements with cash from
operations results, in part, from continued efforts to streamline
operations and reduce costs, as well as from collections under rate
phase-in plans that exceed current cash requirements for the related
costs. (In the income statement, these revenue collections are offset
by the amortization of previously deferred costs; therefore, there is
no effect on net income.) These phase-in plans will continue to
contribute to Entergy's cash position for the next several years.
Specifically, the Grand Gulf 1 phase-in plans will expire in 1998 for
AP&L and MP&L, and in 2001 for NOPSI.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
LIQUIDITY AND CAPITAL RESOURCES
GSU's phase-in plan for River Bend will expire in 1998, and LP&L's
phase-in plan for Waterford 3 expires in 1996. In addition, the
Operating Companies and System Energy have the ability to meet future
capital requirements through future debt or preferred stock issuances,
as discussed below. Also, to the extent current market interest and
dividend rates allow, the Operating Companies and System Energy may
continue to refinance high-cost debt and preferred stock prior to
maturity. See Notes 5, 6, and 8 for additional information on the
System's capital and refinancing requirements in 1996 - 2000.
Entergy Corporation periodically reviews its capital structure to
determine its future needs for debt and equity financing. Certain
agreements and restrictions limit the amount of mortgage bonds and
preferred stock that can be issued by the Operating Companies and
System Energy. Based on the most restrictive applicable tests as of
December 31, 1995, and assumed annual interest or dividend rates of
8.25% for bonds and 8.50% for preferred stock, each of the Operating
Companies and System Energy could have issued mortgage bonds or
preferred stock in the following amounts:
<TABLE>
<CAPTION>
Mortgage Preferred
Company Bonds Stock
(In Millions)
<S> <C> <C>
AP&L $ 307 $ 553
GSU $ 824 (a)
LP&L $ 106 $ 829
MP&L $ 256 $ 269
NOPSI $ 55 $ 187
System Energy $ 137 (b)
</TABLE>
(a) GSU was precluded from issuing preferred stock at December 31,
1995.
(b) System Energy's charter does not presently provide for the
issuance of preferred stock.
In addition to these amounts, the Operating Companies and System
Energy have the ability, subject to certain conditions, to issue bonds
against retired bonds. Such amounts may be significant in some
instances, and, in some cases, no earnings coverage test is required.
AP&L may also issue preferred stock to refund outstanding preferred
stock without meeting an earnings coverage test. GSU has no earnings
coverage limitations on the issuance of preference stock. In January
of 1996, the Boards of Directors of AP&L and LP&L authorized the
officers of those companies to deposit cash with the trustees under
their respective first mortgage indentures to satisfy the annual
maintenance and replacement fund requirements thereunder, and to
require the trustees to use such cash to redeem all or a part of
certain series of first mortgage bonds at par as permitted by the
respective first mortgage indentures. See Notes 5 and 6 for long-term
debt and preferred stock issuances and retirements. See Note 4 for
information on the System's short-term borrowings.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
LIQUIDITY AND CAPITAL RESOURCES
Financing Requirements
Productive investment by Entergy Corporation is necessary to
enhance the long-term value of its common stock. Entergy Corporation
has been expanding its investments in nonregulated business
opportunities overseas as well as in the United States. Through the
end of 1995, Entergy Corporation had participated in foreign non
regulated electric ventures in Pakistan, Argentina, and Peru. As of
December 31, 1995, Entergy Corporation had invested $555.5 million in
equity capital (reduced by $169 million of accumulated losses) in
nonregulated businesses. See Note 15 for a discussion of Entergy
Corporation's acquisition of CitiPower on January 5, 1996.
In addition to investing in nonregulated businesses, Entergy
Corporation's capital requirements include periodically investing in,
or making loans to, its subsidiaries, and sustaining its dividends. To
meet such capital requirements, Entergy Corporation will utilize
internally generated funds, cash on hand, and the $70 million remaining
on its $300 million credit facility ($230 million of this credit
facility was used for the CitiPower acquisition). Entergy Corporation
receives funds through dividend payments from its subsidiaries. During
1995, such common stock dividend payments from subsidiaries totaled
$565.6 million, none of which was contributed by GSU. Entergy
Corporation, in turn, paid $408.6 million of dividends on its common
stock. Declarations of dividends on common stock are made at the
discretion of Entergy Corporation's Board of Directors. It is
anticipated that management will not recommend future dividend
increases to the Board unless such increases are justified by sustained
earnings growth of Entergy Corporation and its subsidiaries. See Note
7 for information on dividend restrictions.
Entergy Corporation and GSU
See Notes 2 and 8 regarding River Bend rate appeals and litigation
with Cajun. Adverse rulings in the River Bend rate appeal could result
in approximately $289 million of potential write-offs (net of tax) and
$182 million in refunds of previously collected revenue. Such write-
offs and charges, as well as the application of SFAS 121 (see Note 1),
could result in substantial net losses being reported in the future by
Entergy Corporation and GSU, with resulting adverse adjustments to
common equity of Entergy Corporation and GSU. Adverse resolution of
these matters could adversely affect GSU's ability to obtain financing,
which could in turn affect GSU's liquidity and ability to pay
dividends. Although Entergy Corporation's common shareholders
experienced some dilution in earnings as a result of the Merger,
Entergy believes that the Merger will ultimately be beneficial to
common shareholders in terms of strategic benefits as well as economies
and efficiencies produced.
Entergy Corporation and System Energy
Under the Capital Funds Agreement, Entergy Corporation has agreed
to supply to System Energy sufficient capital to maintain System
Energy's equity capital at a minimum of 35% of its total capitalization
(excluding short-term debt), to permit the continued commercial
operation of Grand Gulf 1, and to pay in full all indebtedness for
borrowed money of System Energy when due under any circumstances. In
addition, under supplements to the Capital Funds Agreement assigning
System Energy's rights as security for specific debt of System Energy,
Entergy Corporation has agreed to make cash capital contributions, if
required, to enable System Energy to make payments on such debt when
due. The Capital Funds Agreement can be terminated by the parties
thereto, subject to consent of certain creditors.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
Competition and Industry Challenges
Electric utilities traditionally have operated as regulated
monopolies in which there was little opportunity for direct competition
in the provision of electric service. In return for the ability to
receive a reasonable return on and of their investments, utilities were
obligated to provide service and meet future customer requirements.
However, the electric utility industry is now undergoing a transition
to an environment of increased retail and wholesale competition.
Pressures that underlie the movement toward increasing competition
are numerous and complex. They include legislative and regulatory
changes, technological advances, consumer demands, greater availability
of natural gas, environmental needs, and other factors. The increasingly
competitive environment presents opportunities to compete for new
customers, as well as the risk of loss of existing customers.
Competition presents Entergy with many challenges. The following have
been identified by Entergy as its major competitive challenges.
The Energy Policy Act of 1992
The EPAct addresses a wide range of energy issues and is being
implemented by both FERC and state regulators. The EPAct is designed
to promote competition among utility and non utility generators by
amending PUHCA to exempt from regulation a class of EWGs, among others,
consisting of utility affiliates and non utilities that own and operate
facilities for the generation and transmission of power for sale at
wholesale. The EPAct also gave FERC the authority to order investor-
owned utilities to transmit power and energy to or for wholesale
purchasers and sellers. This creates potential for electric utilities
and other power producers to gain increased access to the transmission
systems of other utilities to facilitate wholesale sales.
In response to the EPAct, FERC issued a notice of proposed
rulemaking in mid-1994. This rulemaking concerns a regulatory
framework for dealing with recovery of costs that were prudently
incurred by electric utilities to serve customers under the traditional
regulatory framework. These costs may become "stranded" as a result of
increased competition. On March 29, 1995, FERC issued a supplemental
notice of proposed rulemaking in this proceeding that would require
public utilities to provide nondiscriminatory open access transmission
service to wholesale customers and would also provide guidance on the
recovery of wholesale and retail stranded costs. The risk of exposure
to stranded costs that may result from competition in the industry will
depend on the extent and timing of retail competition, the resolution
of jurisdictional issues concerning stranded cost recovery, and the
extent to which such costs are recovered from departing or remaining
customers.
With regard to pending proceedings, including Entergy's open
access transmission tariff proceedings originally filed in 1991 and
amended in 1994 and 1995, FERC directed the parties to proceed with
their cases while taking into account FERC's proposed rule. Comments
and reply comments on the proposed rulemaking have now been filed with
FERC by interested parties. Certain of the parties filing comments
have proposed that FERC should order the immediate unbundling of all
retail services as part of the final rulemaking in this proceeding,
which is expected in the second quarter of 1996. In its comments in
the proposed rulemaking, Entergy urged FERC to exercise its authority
and responsibility to serve as a "backstop" in the event a state is
unable or unwilling to provide for stranded-cost recovery --
particularly in the case of multi state utilities (such as the System),
where cost shifting among jurisdictions might otherwise occur.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
Retail and Wholesale Rate Issues
The retail regulatory philosophy is shifting in some jurisdictions
from traditional cost-of-service regulation to incentive-rate
regulation. Incentive and performance-based rate plans encourage
efficiencies and productivity while permitting utilities and their
customers to share in the results. MP&L implemented an incentive-rate
plan in March 1994 and, in June 1995, the LPSC implemented a
performance-based formula rate plan for LP&L. The continuing pattern
of rate reductions is a characteristic of the competitive environment
in which Entergy operates.
Several of the Operating Companies have recently been ordered to
grant base rate reductions and have refunded or credited customers for
previous overcollections of rates. See Note 2 for additional
discussion of rate reductions and incentive-rate regulation.
In connection with the Merger, AP&L and MP&L agreed with their
respective retail regulators not to request any general retail rate
increases that would take effect before November 1998, with certain
exceptions. MP&L also agreed that during this period retail base rates
under its formula rate plan would not be increased above the level of
rates in effect on November 1, 1993. In connection with the Merger,
NOPSI agreed with the Council to reduce its annual electric base rates
by $4.8 million, effective for bills rendered on or after November 1,
1993. GSU agreed with the LPSC and PUCT to a five-year Rate Cap on
retail electric rates, and to pass through to retail customers the fuel
savings and a certain percentage of the nonfuel savings created by the
Merger. Under the terms of their respective Merger agreements, the
LPSC and PUCT have reviewed GSU's base rates during the first
post-Merger earnings analysis and ordered rate reductions. See Note 2
for additional discussion of GSU's post-Merger filings with the LPSC
and the PUCT.
System Energy implemented a $65.5 million rate increase, subject
to refund, in December 1995.
Potential Changes in the Electric Utility Industry
Retail wheeling, the transmission by an electric utility of energy
produced by another entity over the utility's transmission and
distribution system to a retail customer in the electric utility's area
of service, continues to evolve. Approximately 40 states have
initiated studies of the concept of retail competition or are
considering it as part of industry restructuring. Within the area
served by the Operating Companies, the City of New Orleans, Louisiana,
and Texas are conducting such studies.
In January 1996, the Council voted to investigate retail utility
service competition. Although no date has been set, the investigation
will focus on the impact of competition, service unbundling, and
utility restructuring on consumers of retail electric and gas utility
service in New Orleans. Earlier in 1995, a newly incorporated entity,
Crescent City Utilities, Inc., submitted to the Council a draft
resolution intended to permit the use of NOPSI's gas and electric
transmission and distribution facilities by any other franchised
utility to supply electricity and gas to retail customers in New
Orleans. The Council has not scheduled hearings relating to this
resolution.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
The PUCT is currently developing rules that will permit greater
wholesale electric competition in Texas, as mandated by the Texas
legislature in its 1995 session. These wholesale transmission access
rules are expected to be in place by the first quarter of 1996. In
addition, the PUCT is developing information to be contained in reports
that will be submitted to the 1997 legislature concerning broader
competitive issues such as the unbundling of electric utility
operations, market-based pricing, performance-based ratemaking, and the
identification and recovery of potential stranded costs as part of the
transition to a more competitive electric industry environment. This
information will be developed through a series of workshops and
comments by interested parties throughout 1996. In addition, during
1995, the Texas legislature revised the Public Utility Regulatory Act,
the law regulating electric utilities in Texas. The revised law
permits utility and non utility EWGs and power marketers to sell
wholesale power in the state. The revised law also permits the
discounting of rates with certain conditions, but does not change the
current law governing retail wheeling or the treatment of federal
income taxes.
During the second quarter of 1995, the Louisiana legislature
considered a bill permitting local retail wheeling. The bill was
defeated, but similar bills are likely to be introduced in the future.
During the same time period, the LPSC initiated a generic docket to
investigate retail, wholesale, and affiliate wheeling of electricity.
Currently, no procedural schedule has been set for this docket.
During January 1996, a bill entitled the "Electric Power
Competition Act of 1996" was introduced into the United States House
of Representatives. The bill proposes to amend certain provisions
under PURPA for the purpose of facilitating future deregulation of the
electric power industry.
In some areas of the country, municipalities (or comparable
entities) whose residents are served at retail by an investor-owned
utility pursuant to a franchise, are exploring the possibility of
establishing new electric distribution systems, or extending existing
ones. In some cases, municipalities are also seeking new delivery
points in order to serve retail customers, especially large industrial
customers, which currently receive service from an investor-owned
utility. Where successful, however, the establishment of a municipal
system or the acquisition by a municipal system of a utility's
customers could result in the utility's inability to recover costs
that it has incurred for the purpose of serving those customers.
Significant Industrial Cogeneration Effects
Many of Entergy's industrial customers, whose costs structures are
energy-sensitive, have energy alternatives available to them such as
fuel switching, cogeneration, and production shifting. Cogeneration
is generally defined as the combined production of electricity and some
other useful form of heat, typically steam. Cogenerated power may
either be sold by its producer to the local utility at its avoided cost
under PURPA, and/or utilized by the cogenerator to displace purchases
from the utility. To the extent that cogeneration is used by
industrial customers to meet their own power requirements, the System
may suffer loss of industrial load. It is the practice of the
Operating Companies to negotiate the renewal of contracts with large
industrial customers prior to their expiration. In certain cases
(particularly for GSU and LP&L), contracts or special tariffs that use
flexible pricing have been negotiated with industrial customers to keep
these customers on the System. The pricing agreements are not at full
cost of service. Such rates may fully recover all related costs, but
provide only a minimal return, if any, on investment. In 1995, KWh
sales to GSU's and LP&L's industrial customers at less than full cost-
of-service rates made up approximately 27% and 39% of GSU's and LP&L's
total industrial class sales, respectively.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
Since PURPA was enacted in 1978, the Operating Companies have been
largely successful in retaining industrial load. The Operating
Companies anticipate they will be successful in renegotiating such
contracts with large industrial customers. However, this competitive
challenge will likely increase. There can be no assurance that the
Operating Companies will be successful or that future revenues will not
be lost to other forms of generation.
The Council has recently approved a resolution requiring its prior
approval of regulatory treatment of any lost contribution to fixed
costs as a result of incentive-rate agreements with large industrial or
commercial customers entered into for the purposes of retaining those
customers. The resolution also requires prior approval by the Council
of the regulatory treatment of stranded costs resulting from the loss
of large customers.
During 1995, LP&L received separate notices from two large
industrial customers that will proceed with proposed
cogeneration projects for the purpose of fulfilling their future
electric energy needs. These customers will continue to purchase their
energy requirements from LP&L until their cogeneration facilities are
completed and operational, which is expected to occur between the years
1997 and 1998. After that time these customers will still purchase
energy from LP&L, but at a reduced level. During 1995, these two
customers represented an aggregate of approximately 18% of total LP&L
industrial sales, and provided 12% of total industrial base revenues.
Domestic and Foreign Energy-Related Investments
Entergy Corporation seeks opportunities to expand its domestic
energy-related businesses that are not regulated by state and local
regulatory authorities, as well as foreign power investments that
provide returns in excess of similar domestic investments. Such
business ventures currently include power development and new
technology related to the utility business. Entergy Corporation's
strategy is to identify and pursue business opportunities that have the
potential to earn a greater return than its regulated utility
operations. Refer to "MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS -
LIQUIDITY AND CAPITAL RESOURCES" for a discussion of Entergy
Corporation's 1995 investment in domestic and foreign energy-related
businesses. These investments may involve a greater risk than
domestically regulated utility enterprises. In 1995, Entergy
Corporation's investments in domestic and foreign energy-related
investments reduced consolidated net income by approximately $64.8
million. While such investments did not have a positive effect on 1995
earnings, management believes they will show profits in the near term.
In an effort to expand into new energy-related businesses, Entergy
plans to commercialize its fiber optic telecommunications network that
connects system facilities and supports its internal business needs.
Entergy will provide long-haul fiber optic capacity to major
telecommunications carriers, which in turn will market that service to
third parties. The recently enacted Telecommunications Act of 1996
permits Entergy to market such a service,
pending state and local regulatory approval. On February 8, 1996, the
President of the United States signed the Telecommunications Act into
law. This new law contains an exemption from PUHCA that will permit
registered utility holding companies to form and capitalize
subsidiaries to engage in telephone, telecommunications, and
information service businesses without SEC approval. However, the law
requires that such telecommunications subsidiaries file for exemption
with the Federal Communications Commission, and that they not engage in
transactions with utility affiliates within their holding company
systems or acquire utility affiliates' property without state or local
regulatory approval. Entergy Corporation has requested approval from
the SEC to form a new nonregulated subsidiary named Entergy Technologies
Company to commercialize the Entergy telecommunications network.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
In early October 1995, FERC issued an order granting EWG status to
Entergy Power Marketing Corporation (EPM), a wholly owned subsidiary of
Entergy Corporation. EPM was created during 1995 to become a buyer and
seller of electrical energy and its generating fuels. In February
1996, FERC approved market-based rate sales of electricity by EPM.
Such approval will allow EPM to begin providing wholesale customers
with a variety of services including physical and financial trading.
Pending approval from the SEC, EPM expects to begin financial trading
by the summer of 1996.
On January 5, 1996, Entergy Corporation finalized its acquisition
of CitiPower, an electric distribution company serving Melbourne,
Australia, and surrounding suburbs. The purchase price of CitiPower
was approximately $1.2 billion, of which $294 million represented an
equity investment by Entergy Corporation, and the remainder represented
debt. Entergy Corporation funded the majority of the equity portion of
the investment by using $230 million of its $300 million line of
credit. CitiPower serves approximately 234,500 customers, the majority
of which are commercial customers. At the time of the acquisition,
CitiPower had 846 employees.
ANO Matters
Entergy Operations has made inspections and repairs from time to
time on ANO 2's steam generators. During the October 1995 inspection,
additional cracks in the tubes were discovered. Currently, Entergy
Operations is in the process of gathering information and assessing
various options for the repair or replacement of ANO 2's steam
generators. See Note 8 for additional information.
Deregulated Utility Operations
GSU discontinued regulatory accounting principles for its
wholesale jurisdiction and steam department and the Louisiana
deregulated portion of River Bend during 1989 and 1991, respectively.
The operating income (loss) from these operations was $7.2 million in
1995, $(5.2) million in 1994, and $(2.9) million in 1993.
The increase in 1995 net income from deregulated operations was
due to increased revenues and reduced operation and maintenance
expenses, partially offset by increased depreciation. The larger net
loss from deregulated operations in 1994 was principally due to a
smaller income tax benefit. The future impact of the deregulated
utility operations on Entergy and GSU's results of operations and
financial position will depend on future operating costs, the
efficiency and availability of generating units, and the future market
for energy over the remaining life of the assets. Entergy expects the
performance of its deregulated utility operations to improve, due to
continued reductions in operation and maintenance expenses. The
deregulated operations will be subject to the requirements of SFAS 121,
as discussed in Note 1, in determining the recognition of any asset
impairment.
Property Tax Exemptions
LP&L and GSU are working with tax authorities to determine the
method for calculating the amount of property taxes to be paid once
Waterford 3 and River Bend's local property tax exemptions expire.
Waterford 3's exemption expired in December 1995 and River Bend's
exemption expires in December 1996. LP&L expects that the LPSC will
address the accounting treatment and recovery of Waterford 3's property
taxes in April 1996, in conjunction with the annual filing required
under its performance-based formula rate plan.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
SIGNIFICANT FACTORS AND KNOWN TRENDS
Environmental Issues
GSU has been notified by the U. S. Environmental Protection Agency
(EPA) that it has been designated as a PRP for the clean-up of certain
hazardous waste disposal sites. See Note 8 for additional information.
As a consequence of rules for solid waste regulation issued by the
Louisiana Department of Environmental Quality in 1993, LP&L has
determined that certain of its power plant wastewater impoundments
must be upgraded or closed. See Note 8 for additional information.
Accounting Issues
New Accounting Standard - In March 1995, the FASB issued SFAS 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" (SFAS 121), effective January 1, 1996. This
standard describes circumstances that may result in assets being
impaired and provides criteria for recognition and measurement of asset
impairment. See Notes 1 and 2 for information regarding the potential
impacts of the new accounting standard on Entergy.
Continued Application of SFAS 71 - As a result of the EPAct and
actions of regulatory commissions, the electric utility industry is
moving toward a combination of competition and a modified regulatory
environment. The System's financial statements currently reflect, for
the most part, assets and costs based on current cost-based ratemaking
regulations in accordance with SFAS 71, "Accounting for the Effects of
Certain Types of Regulation" (SFAS 71). Continued applicability of
SFAS 71 to the System's financial statements requires that rates set by
an independent regulator on a cost-of-service basis can actually be
charged to and collected from customers.
In the event that all or a portion of a utility's operations cease
to meet those criteria for various reasons, including deregulation, a
change in the method of regulation, or a change in the competitive
environment for the utility's regulated services, the utility should
discontinue application of SFAS 71 for the relevant portion. That
discontinuation should be reported by elimination from the balance
sheet of the effects of any actions of regulators recorded as
regulatory assets and liabilities.
As of December 31, 1995, and for the foreseeable future, the
System's financial statements continue to follow SFAS 71, except for
certain portions of GSU's business. See Note 1 for additional
discussion of Entergy's application of SFAS 71.
Accounting for Decommissioning Costs - The staff of the SEC has
been reviewing the financial accounting practices of the electric
utility industry regarding the recognition, measurement, and
classification of nuclear decommissioning costs for nuclear generating
stations in the financial statements of electric utilities. In
February 1996 the FASB issued an exposure draft of the proposed SFAS
addressing the accounting for decommissioning costs as well as
liabilities related to the closure and removal of all long-lived
assets. See Note 8 for a discussion of proposed changes in the
accounting for decommissioning/closure costs and the potential impact of
these changes on Entergy.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of Entergy Corporation
We have audited the accompanying consolidated balance sheets of
Entergy Corporation and Subsidiaries as of December 31, 1995 and 1994,
and the related statements of consolidated income, retained earnings
and paid-in-capital and cash flows for the years then ended. These
financial statements are the responsibility of the Corporation's
management. Our responsibility is to express an opinion on these
financial statements based on our audits. The consolidated financial
statements of Entergy Corporation and Subsidiaries for the year ended
December 31, 1993, were audited by other auditors, whose report, dated
February 11, 1994, included explanatory paragraphs that (i) described
changes in 1993 in the method of accounting for revenues by certain of
the Corporation's subsidiaries (Note 1); (ii) uncertainties regarding
costs capitalized by Gulf States Utilities Company for its River Bend
Unit I Nuclear Generating Plant (River Bend) and other rate-related
contingencies which may result in a refund of revenues previously
collected (Note 2); and, (iii) an uncertainty regarding civil actions
against Gulf States Utilities Company (Note 8).
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position
of Entergy Corporation and Subsidiaries as of December 31, 1995 and
1994, and the results of their operations and their cash flows for the
years then ended in conformity with generally accepted accounting
principles.
As discussed in Note 2 to the consolidated financial statements,
the net amount of capitalized costs for River Bend exceed those costs
currently being recovered through rates. At December 31, 1995,
approximately $482 million is not currently being recovered through
rates. If current regulatory and court orders are not modified, a
write-off of all or a portion of such costs may be required.
Additionally, other rate-related contingencies exist which may result
in refunds of revenues previously collected. The extent of such write-
off of capitalized River Bend costs or refunds of revenues previously
collected, if any, will not be determined until appropriate rate
proceedings and court appeals have been concluded. Accordingly, the
accompanying consolidated financial statements do not include any
adjustments or provision for write-off or refund that might result from
the outcome of these uncertainties. As also discussed in Note 2,
approximately $187 million of additional deferred River Bend operating
costs which exceed those costs currently being recovered through rates
are expected to be written-off upon the adoption of Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of."
Adoption of this Statement is required on January 1, 1996.
As discussed in Note 8 to the consolidated financial statements,
civil actions have been initiated against Gulf States Utilities Company
to, among other things, recover the co-owner's investment in River Bend
and to annul the River Bend Joint Ownership Participation and Operating
Agreement. The ultimate outcome of these proceedings cannot presently
be determined.
As discussed in Note 1 to the consolidated financial statements,
in 1995 one of the Corporation's subsidiaries changed its method of
accounting for incremental nuclear plant outage maintenance costs.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of the Directors and the Shareholders of
Entergy Corporation:
We have audited the accompanying statements of consolidated
income, retained earnings and paid-in capital, and cash flows of
Entergy Corporation and subsidiaries for the year ended December 31,
1993. These financial statements are the responsibility of the
Corporation's management. Our responsibility is to express an opinion
on these financial statements based on our audit. We did not audit the
financial statements of Gulf States Utilities Company (a consolidated
subsidiary acquired on December 31, 1993), which statements reflect
total assets constituting 31% of consolidated total assets at
December 31, 1993. Those statements were audited by other auditors
whose report (which included explanatory paragraphs regarding the
uncertainties discussed in the fourth and fifth paragraphs below) has
been furnished to us, and our opinion, insofar as it relates to the
amounts included for Gulf States Utilities Company, is based solely on
the report of such auditors.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit and the report of the other
auditors provide a reasonable basis for our opinion.
In our opinion, based on our audit and the report of the other
auditors, such consolidated financial statements present fairly, in all
material respects, the results of Entergy Corporation and subsidiaries'
operations and their cash flows for the year ended December 31, 1993 in
conformity with generally accepted accounting principles.
The Corporation acquired a 70% interest in River Bend Unit 1
Nuclear Generating Plant (River Bend) through its acquisition of Gulf
States Utilities Company on December 31, 1993. As discussed in Note 2
to the consolidated financial statements, the net amount of capitalized
costs for River Bend exceed those costs currently being recovered
through rates. If current regulatory and court orders are not
modified, a write-off of all or a portion of such costs may be
required. Additionally, as discussed in Note 2 to the consolidated
financial statements, other rate-related contingencies exist which may
result in a refund of revenues previously collected. The extent of
such write-off of capitalized River Bend costs or refund of revenue
previously collected, if any, will not be determined until appropriate
rate proceedings and court appeals have been concluded. Accordingly,
the accompanying 1993 consolidated financial statements do not include
any adjustments that might result from the outcome of these
uncertainties.
As discussed in Note 8 to the consolidated financial statements,
civil actions have been initiated against Gulf States Utilities Company
to, among other things, recover the co-owner's investment in River Bend
and to annul the related joint ownership participation and operating
agreement. The ultimate outcome of these proceedings, including their
impact on Gulf States Utilities Company, cannot presently be
determined. Accordingly, the accompanying 1993 consolidated financial
statements do not include any adjustments that might result from the
outcome of this uncertainty.
As discussed in Note 1 to the consolidated financial statements,
certain of the Corporation's subsidiaries changed their method of
accounting for revenues in 1993.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
On December 31, 1993, GSU became a subsidiary of Entergy
Corporation. In accordance with the purchase method of accounting, the
results of operations for the twelve months ended December 31, 1993, of
Entergy Corporation and Subsidiaries reported in its Statements of
Consolidated Income and Cash Flows do not include GSU's results of
operations. However, the following discussion is presented with GSU's
1993 results of operations included for comparative purposes.
Net Income
Consolidated net income increased in 1995 due primarily to
increased electric operating revenues, decreased other operation and
maintenance expenses, the onetime recording of the cumulative effect of
the change in accounting method for incremental nuclear refueling
outage maintenance costs at AP&L, and decreased interest expense,
partially offset by increased income taxes and decreased miscellaneous
income - net.
Consolidated net income decreased in 1994 due primarily to the one
time recording in 1993 of the cumulative effect of the change in
accounting principle for unbilled revenues for AP&L, GSU, MP&L, and
NOPSI, and a base-rate reduction ordered by the PUCT. In addition,
net income was impacted by a decrease in revenues, increased Merger-
related costs, certain restructuring costs, and decreased miscellaneous
income - net, partially offset by a decrease in interest on long-term
debt and preferred dividend requirements.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales," "Expenses," and "Other"
below.
Revenues and Sales
See "SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON," following
the notes, for information on operating revenues by source and KWh
sales.
The changes in electric operating revenues for the twelve months
ended December 31, 1995, are as follows:
Increase/
Description (Decrease)
----------------------- ------------
(In Millions)
Change in base revenues $6.6
Rate riders 15.3
Fuel cost recovery (28.0)
Sales volume/weather 141.3
Other revenue (including 4.3
unbilled)
Sales for resale 49.5
System Energy-FERC Settlement 120.5
-------
Total $309.5
=======
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Electric operating revenues increased in 1995 as a result of an
increase in retail energy sales, the effects of the 1994 FERC
Settlement, and increased wholesale revenues, partially offset by rate
reductions at GSU, LP&L, and NOPSI and lower fuel adjustment revenues.
Warmer weather and non-weather related volume growth contributed
equally to the increase in retail electric energy sales. The increase
in sales for resale was primarily from increased energy sales outside
of Entergy's service area. The increase in other revenues was due to
the effects of the 1994 FERC Settlement and the 1994 NOPSI Settlement.
Electric operating revenues decreased in 1994 due primarily to
rate reductions at GSU, MP&L, and NOPSI, the effects of the 1994 NOPSI
Settlement and the FERC Settlement, and decreased fuel adjustment
revenues, partially offset by increased retail energy sales and
increased collections of previously deferred Grand Gulf 1-related
costs.
Gas operating revenues decreased in 1995 because of a milder
winter than in 1994, gas rate reductions agreed to in the 1994 NOPSI
Settlement, and a lower unit price for gas purchased for resale. Gas
operating revenues decreased slightly in 1994 as a result of lower
weather-related sales.
Expenses
Operating expenses increased in 1995 due to increased income taxes
related to higher pre-tax book income and the effects of the 1994 FERC
Settlement. In addition, nuclear refueling outage expenses increased
due to a 1995 refueling outage at Grand Gulf 1 and the adoption of the
change in accounting method at AP&L. The increase in operating
expenses was partially offset by a reduction in other operation and
maintenance expenses. Other operation and maintenance expenses decreased
primarily because of lower payroll-related expenses resulting from the
restructuring program discussed in Note 11 and 1994 Merger-related
costs.
Operating expenses decreased in 1994 due primarily to decreased
power purchases from nonassociated utilities and to changes in
generation requirements for the Operating Companies, decreased nuclear
refueling outage expenses as the result of Grand Gulf 1 outage expenses
incurred in 1993, decreased income taxes due primarily to lower pre-tax
book income, and the effects of the FERC Settlement.
Interest charges decreased in 1995 and 1994 as a result of the
retirement and refinancing of higher cost long-term debt.
Preferred dividend requirements decreased in 1995 and 1994 due to
stock redemption activities.
Other
Miscellaneous other income - net decreased in 1995 due primarily
to expansion activities in nonregulated businesses.
Miscellaneous other income - net decreased in 1994 due primarily
to the amortization of the plant acquisition adjustment related to the
GSU Merger, the adoption of SFAS 116, "Accounting for Contributions
Made and Contributions Received," and reduced Grand Gulf 1 carrying
charges at AP&L.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------- -------------------- --------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands, Except Share Data)
<S> <C> <C> <C>
Operating Revenues:
Electric $ 6,121,141 $ 5,811,600 $ 4,384,233
Natural gas 103,992 118,962 90,991
Steam products 49,295 46,559 -
-------------------- -------------------- --------------------
Total 6,274,428 5,977,121 4,475,224
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel, fuel-related expenses, and
gas purchased for resale 1,395,889 1,450,598 907,100
Purchased power 356,596 340,067 278,070
Nuclear refueling outage expenses 84,972 63,979 76,383
Other operation and maintenance 1,468,851 1,581,520 1,045,713
Depreciation, amortization, and decommissioning 690,841 656,896 443,550
Taxes other than income taxes 299,926 284,234 199,151
Income taxes 349,528 131,965 251,163
Amortization of rate deferrals 408,087 399,121 280,753
-------------------- -------------------- --------------------
Total 5,054,690 4,908,380 3,481,883
-------------------- -------------------- --------------------
Operating Income 1,219,738 1,068,741 993,341
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 9,629 11,903 8,049
Miscellaneous - net (20,947) 20,631 50,957
Income taxes 13,346 241 (33,640)
-------------------- -------------------- --------------------
Total 2,028 32,775 25,366
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 633,851 665,541 503,797
Other interest - net 33,749 22,354 5,740
Allowance for borrowed funds used
during construction (8,368) (9,938) (5,478)
Preferred and preference dividend requirements of
subsidiaries and other 77,969 81,718 56,559
-------------------- -------------------- --------------------
Total 737,201 759,675 560,618
-------------------- -------------------- --------------------
Income before the Cumulative Effect 484,565 341,841 458,089
of Accounting Changes
Cumulative Effect of Accounting
Changes (net of income taxes) 35,415 - 93,841
-------------------- -------------------- --------------------
Net Income $ 519,980 $ 341,841 $ 551,930
==================== ==================== ====================
Earnings per average common share
before cumulative effect of
accounting changes $ 2.13 $ 1.49 $ 2.62
Earnings per average common share $ 2.28 $ 1.49 $ 3.16
Dividends declared per common share $ 1.80 $ 1.80 $ 1.65
Average number of common shares
outstanding 227,669,970 228,734,843 174,887,556
See Notes to Financial Statements.
</TABLE>
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 519,980 $ 341,841 $ 551,930
Noncash items included in net income:
Cumulative effect of a change in accounting principle (35,415) - (93,841)
Change in rate deferrals/excess capacity-net 390,177 394,344 200,532
Depreciation, amortization, and decommissioning 690,841 656,896 443,550
Deferred income taxes and investment tax credits (31,006) (151,731) 17,669
Allowance for equity funds used during construction (9,629) (11,903) (8,049)
Amortization of deferred revenues - (14,632) (42,470)
Changes in working capital:
Receivables (30,550) (382) (40,682)
Fuel inventory (28,956) 16,993 (1,161)
Accounts payable (19,124) 65,776 (9,167)
Taxes accrued 115,250 (25,689) (32,761)
Interest accrued (194) (15,255) (758)
Reserve for rate refund (48,117) 56,972 -
Other working capital accounts (114,436) 105,907 51,100
Refunds to customers - gas contract settlement - - (56,027)
Decommissioning trust contributions (37,756) (24,755) (20,402)
Provision for estimated losses and reserves 14,065 22,522 20,832
Other 21,601 120,863 94,092
---------------- ---------------- ----------------
Net cash flow provided by operating activities 1,396,731 1,537,767 1,074,387
---------------- ---------------- ----------------
Investing Activities:
Merger with GSU - cash paid - - (250,000)
Merger with GSU - cash acquired - - 261,349
Construction/capital expenditures (618,436) (676,180) (512,235)
Allowance for equity funds used during construction 9,629 11,903 8,049
Nuclear fuel purchases (207,501) (179,932) (118,216)
Proceeds from sale/leaseback of nuclear fuel 226,607 128,675 121,526
Investment in nonregulated/nonutility properties (172,814) (49,859) (76,870)
Proceeds received from sale of property - 26,000 -
Decrease in other temporary investments - - 17,012
---------------- ---------------- ----------------
Net cash flow used in investing activities (762,515) (739,393) (549,385)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of:
First mortgage bonds - 59,410 605,000
General and refunding mortgage bonds 109,285 24,534 350,000
Other long-term debt 273,542 164,699 106,070
Retirement of:
First mortgage bonds (225,800) (303,800) (911,692)
General and refunding mortgage bonds (69,200) (45,000) (99,400)
Other long-term debt (221,043) (148,962) (69,982)
Premium and expense on refinancing sale/leaseback bonds - (48,497) -
Repurchase of common stock - (119,486) (20,558)
Redemption of preferred stock (46,564) (49,091) (56,000)
Changes in short-term borrowings (126,200) 128,200 43,000
Common stock dividends paid (408,553) (410,223) (287,483)
---------------- ---------------- ----------------
Net cash flow used in financing activities (714,533) (748,216) (341,045)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents (80,317) 50,158 183,957
Cash and cash equivalents at beginning of period 613,907 563,749 379,792
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 533,590 $ 613,907 $ 563,749
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 626,531 $ 660,150 $ 485,876
Income taxes $ 285,738 $ 218,667 $ 159,659
Noncash investing and financing activities:
Capital lease obligations incurred - $ 88,574 $ 126,812
Change in unrealized appreciation/depreciation of
decommissioning trust assets $ 16,614 $ (2,198) -
Merger with GSU - common stock issued - - $ 2,032,071
See Notes to Financial Statements.
</TABLE>
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 21,698,593 $ 21,184,013
Plant acquisition adjustment - GSU 471,690 487,955
Electric plant under leases 675,425 668,846
Property under capital leases - electric 145,146 161,950
Natural gas 166,872 164,013
Steam products 77,551 77,307
Construction work in progress 482,950 476,816
Nuclear fuel under capital leases 312,782 265,520
Nuclear fuel 49,100 70,147
------------ ------------
Total 24,080,109 23,556,567
Less - accumulated depreciation and amortization 8,259,318 7,639,549
------------ ------------
Utility plant - net 15,820,791 15,917,018
------------ ------------
Other Property and Investments:
Decommissioning trust funds 277,716 207,395
Other 434,619 240,745
------------ ------------
Total 712,335 448,140
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 42,822 87,700
Temporary cash investments - at cost,
which approximates market 490,768 526,207
------------ ------------
Total cash and cash equivalents 533,590 613,907
Special deposits 10,884 8,074
Notes receivable 6,907 9,509
Accounts receivable:
Customer (less allowance for doubtful accounts of
$7.1 million in 1995 and $6.7 million in 1994) 333,343 348,169
Other 59,176 66,651
Accrued unbilled revenues 293,461 240,610
Deferred fuel 25,924 -
Fuel inventory 122,167 93,211
Materials and supplies - at average cost 345,330 365,956
Rate deferrals 420,221 388,995
Prepayments and other 164,237 98,811
------------ ------------
Total 2,315,240 2,233,893
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals 1,033,282 1,443,283
SFAS 109 regulatory asset - net 1,279,495 1,417,646
Unamortized loss on reacquired debt 224,131 232,420
Other regulatory assets 329,397 325,521
Long-term receivables 224,726 264,752
Other 326,533 339,201
------------ ------------
Total 3,417,564 4,022,823
------------ ------------
TOTAL $ 22,265,930 $ 22,621,874
============ ============
See Notes to Financial Statements.
</TABLE>
ENTERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, $.01 par value, authorized 500,000,000
shares; issued 230,017,485 shares in 1995 and 1994 $ 2,300 $ 2,300
Paid-in capital 4,201,483 4,202,134
Retained earnings 2,335,579 2,223,739
Less - treasury stock (2,251,318 shares in 1995 and
2,608,908 in 1994) 67,642 77,378
------------ ------------
Total common shareholders' equity 6,471,720 6,350,795
Subsidiary's preference stock 150,000 150,000
Subsidiaries' preferred stock:
Without sinking fund 550,955 550,955
With sinking fund 253,460 299,946
Long-term debt 6,777,124 7,093,473
------------ ------------
Total 14,203,259 14,445,169
------------ ------------
Other Noncurrent Liabilities:
Obligations under capital leases 303,664 273,947
Other 317,949 310,977
------------ ------------
Total 621,613 584,924
------------ ------------
Current Liabilities:
Currently maturing long-term debt 558,650 349,085
Notes payable 45,667 171,867
Accounts payable 460,379 479,503
Customer deposits 140,054 134,478
Taxes accrued 207,828 92,578
Accumulated deferred income taxes 72,847 40,313
Interest accrued 195,445 195,639
Dividends declared 12,194 13,599
Deferred fuel cost - 27,066
Nuclear refueling reserve 22,627 48,071
Obligations under capital leases 151,140 151,904
Reserve for rate refund 8,855 56,972
Other 224,412 279,259
------------ ------------
Total 2,100,098 2,040,334
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 3,777,644 3,915,138
Accumulated deferred investment tax credits 612,701 649,898
Other 950,615 986,411
------------ ------------
Total 5,340,960 5,551,447
------------ ------------
Commitments and Contingencies (Notes 2, 8, and 9)
TOTAL $ 22,265,930 $ 22,621,874
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED RETAINED EARNINGS AND PAID-IN CAPITAL
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 2,223,739 $ 2,310,082 $ 2,062,188
Add:
Net income 519,980 341,841 551,930
------------------- ------------------- -------------------
Total 2,743,719 2,651,923 2,614,118
------------------- ------------------- -------------------
Deduct:
Dividends declared on common stock 409,801 411,806 288,342
Common stock retirements - 13,940 13,906
Capital stock and other expenses (1,661) 2,438 1,788
------------------- ------------------- -------------------
Total 408,140 428,184 304,036
------------------- ------------------- -------------------
Retained Earnings, December 31 $ 2,335,579 $ 2,223,739 $ 2,310,082
=================== =================== ===================
Paid-in Capital, January 1 $ 4,202,134 $ 4,223,682 $ 1,327,589
Add:
Loss on reacquisition of
subsidiaries' preferred stock (26) (23) (20)
Issuance of 56,695,724 shares of common
stock in the merger with GSU - - 2,027,325
Issuance of 174,552,011 shares of common
stock at $.01 par value net of the
retirement of 174,552,011 shares of
common stock at $5.00 par value - - 871,015
Capital stock expense (3,002) - -
------------------- ------------------- -------------------
Total 4,199,106 4,223,659 4,225,909
------------------- ------------------- -------------------
Deduct:
Common stock retirements - 22,468 4,389
Capital stock discounts and other expenses (2,377) (943) (2,162)
------------------- ------------------- -------------------
Total (2,377) 21,525 2,227
------------------- ------------------- -------------------
Paid-in Capital, December 31 $ 4,201,483 $ 4,202,134 $ 4,223,682
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
----- ----- ----- ----- -----
(In Thousands, Except Per Share Amounts)
<S> <C> <C> <C> <C> <C>
Operating revenues $ 6,274,428 $ 5,977,121 $ 4,475,224 $ 4,098,332 $4,059,135
Income before cumulative
effect of a change in
accounting principle $ 484,565 $ 341,841 $ 458,089 $ 437,637 $482,032
Earnings per share before $2.13 $1.49 $2.62 $2.48 $2.64
cumulative effect of
accounting changes
Dividends declared per share $1.80 $1.80 $1.65 $1.45 $1.25
Return on average common 8.11% 5.31% 12.58% 10.31% 11.57%
equity
Book value per share, year- $28.41 $27.93 $28.27 $24.35 $23.46
end (2)
Total assets (2) $22,265,930 $22,621,874 $22,876,697 $14,239,537 $14,383,102
Long-term obligations (1)(2) $7,484,248 $7,817,366 $8,177,882 $5,630,505 $5,801,364
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt),
preferred and preference stock with sinking fund, and noncurrent
capital lease obligations.
(2) 1993 amounts include the effects of the Merger in accordance with
the purchase method of accounting for combinations.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
------ ------ ------ ------ ------
(In Thousands)
Electric Operating
Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 2,177,348 $ 2,127,820 $ 1,594,515 $ 1,441,628 $1,462,673
Commercial 1,491,818 1,500,462 1,071,070 1,008,474 996,095
Industrial 1,810,045 1,834,155 1,197,695 1,098,147 1,068,224
Governmental 154,032 159,840 136,471 127,880 128,699
-------- -------- -------- -------- --------
Total retail 5,633,243 5,622,277 3,999,751 3,676,129 3,655,691
Sales for resale 367,997 312,892 295,769 252,288 220,347
Other (1) 119,901 (123,569) 88,713 96,971 106,146
-------- -------- -------- -------- --------
Total $ 6,121,141 $ 5,811,600 $ 4,384,233 $ 4,025,388 $3,982,184
========= ========= ========= ========= ========
Billed Electric Energy
Sales (Millions of KWh):
Residential 27,704 26,231 18,946 17,549 18,329
Commercial 20,719 20,050 13,420 12,928 13,164
Industrial 42,260 41,030 24,889 23,610 23,466
Governmental 2,311 2,233 1,887 1,839 1,903
-------- -------- -------- -------- --------
Total retail 92,994 89,544 59,142 55,926 56,862
Sales for resale 10,471 7,908 8,291 7,979 7,346
-------- -------- -------- -------- --------
Total 103,465 97,452 67,433 63,905 64,208
========= ========= ========= ========= ========
</TABLE>
(1)1994 includes the effects of the FERC Settlement, the 1994 NOPSI
Settlement, and a GSU reserve for rate refund.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
Arkansas Power & Light Company
We have audited the accompanying balance sheets of Arkansas Power
& Light Company as of December 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits. The financial
statements of the Company for the year ended December 31, 1993, were
audited by other auditors, whose report, dated February 11, 1994,
included an explanatory paragraph that described a change in the method
of accounting for revenues, which is discussed in Note 1 to these
financial statements.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally
accepted accounting principles.
As discussed in Note 1 to the financial statements, in 1995 the
Company changed its method of accounting for incremental nuclear plant
outage maintenance costs.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and the Board of Directors of
Arkansas Power & Light Company:
We have audited the accompanying statements of income, retained
earnings, and cash flows of Arkansas Power & Light Company (AP&L) for
the year ended December 31, 1993. These financial statements are the
responsibility of AP&L's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the results of AP&L's operations and its cash flows
for the year ended December 31, 1993 in conformity with generally
accepted accounting principles.
As discussed in Note 1 to the financial statements, AP&L changed
its method of accounting for revenues in 1993.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income increased in 1995 due primarily to the onetime
recording of the cumulative effect of the change in accounting method
for incremental nuclear refueling outage maintenance costs as discussed
in Note 1. Excluding the above mentioned item, net income for 1995
decreased due to an increase in depreciation, amortization, and
decommissioning expenses and income tax expense offset by an increase
in revenues from retail energy sales and a decrease in other operation
and maintenance expenses.
Net income decreased in 1994 due primarily to the onetime
recording in the first quarter of 1993 of the cumulative effect of the
change in accounting principle for unbilled revenues and its ongoing
effects, and to increased other operation and maintenance expenses
resulting from restructuring and storm damage costs during 1994.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales," "Expenses," and "Other"
below.
Revenues and Sales
See "SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON," following
the notes to financial statements, for information on operating
revenues by source and KWh sales.
The changes in electric operating revenues for the twelve months
ended December 31, 1995, are as follows:
Increase/
Description (Decrease)
------------------------- -------------
(In Millions)
Change in base revenues $(3.4)
Rate riders 15.9
Fuel cost recovery 25.1
Sales volume/weather 38.2
Other revenue (including unbilled) 9.7
Sales for resale (28.0)
-------
Total $57.5
======
Electric operating revenues increased for 1995 due primarily to
increased retail energy sales and fuel adjustment revenues partially
offset by a decrease in sales for resale to associated companies. The
increase in sales volume/weather resulted from increased customers and
associated usage, while the remainder resulted from warmer weather in
the summer months. The decrease in sales for resale to associated
companies was caused by changes in generation availability and
requirements among the Operating Companies.
Total revenues remained relatively unchanged in 1994. Retail
revenues decreased primarily due to lower recovery of fuel revenues
during the year offset by increased sales for resale to associated
companies in 1994, caused by changes in generation availability and
requirements among the Operating Companies.
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Expenses
Operating expenses increased in 1995 because of an increase in
depreciation, amortization, and decommissioning expenses and income tax
expense, offset by a decrease in other operation and maintenance
expenses. Depreciation, amortization, and decommissioning expenses
increased primarily due to additions and upgrades at ANO and additions
to transmission lines, substations, and other equipment. Also,
decommissioning expense increased due to the implementation of the
decommissioning rate rider which resulted from the decommissioning
study performed in 1994. Income tax expense increased primarily due to
the write-off in 1994 of investment tax credits in accordance with the
FERC Settlement, as discussed below. Income tax expense also increased
due to higher pre-tax income in 1995. The decrease in other operation
and maintenance expenses is largely due to restructuring costs and
storm damage costs recorded in 1994 .
Operating expenses increased in 1994 due primarily to increased
other operation and maintenance expenses and increased amortization of
rate deferrals partially offset by lower purchased power expenses.
Other operation and maintenance expenses increased in 1994 primarily
due to the storm damage and restructuring costs as discussed in Note
11. The decrease in 1994 purchased power expenses is primarily due to
the decrease in the price of purchased power. Total income taxes
decreased during 1994 primarily due to the write-off of unamortized
deferred investment tax credit of $27.3 million due to a FERC
settlement and due to lower pretax income in 1994. This decrease was
partially offset by an increase in tax expense due to the true-up of
actual income tax expense for 1993 determined during 1994.
Other
Miscellaneous other income - net decreased in 1994 due primarily
to reduced Grand Gulf 1 carrying charges. Other income taxes decreased
in 1994 primarily due to a lower pretax income as discussed above.
Interest on long-term debt decreased in 1994 due primarily to the
continued retirement and refinancing of high-cost debt.
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------------------------------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues $ 1,648,233 $ 1,590,742 $ 1,591,568
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel and fuel-related expenses 231,619 261,932 257,983
Purchased power 363,199 328,379 349,718
Nuclear refueling outage expenses 31,754 33,107 30,069
Other operation and maintenance 375,059 390,472 373,758
Depreciation, amortization, and decommissioning 162,087 149,878 135,530
Taxes other than income taxes 38,319 33,610 28,626
Income taxes 53,936 9,938 18,746
Amortization of rate deferrals 174,329 166,793 160,916
-------------------- -------------------- --------------------
Total 1,430,302 1,374,109 1,355,346
-------------------- -------------------- --------------------
Operating Income 217,931 216,633 236,222
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 3,567 4,001 3,627
Miscellaneous - net 46,227 48,049 64,884
Income taxes (18,146) (19,282) (32,451)
-------------------- -------------------- --------------------
Total 31,648 32,768 36,060
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 106,853 106,001 110,472
Other interest - net 8,485 4,811 9,118
Allowance for borrowed funds used
during construction (2,424) (3,674) (2,418)
-------------------- -------------------- --------------------
Total 112,914 107,138 117,172
-------------------- -------------------- --------------------
Income before the Cumulative Effect
of Accounting Changes 136,665 142,263 155,110
Cumulative Effect of Accounting
Changes (net of income taxes) 35,415 - 50,187
-------------------- -------------------- --------------------
Net Income 172,080 142,263 205,297
Preferred Stock Dividend Requirements
and Other 18,093 19,275 20,877
-------------------- -------------------- --------------------
Earnings Applicable to Common Stock $ 153,987 $ 122,988 $ 184,420
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 172,080 $ 142,263 $ 205,297
Noncash items included in net income:
Cumulative effect of a change in accounting principle (35,415) - (50,187)
Change in rate deferrals/excess capacity-net 125,504 102,959 84,712
Depreciation, amortization, and decommissioning 162,087 149,878 135,530
Deferred income taxes and investment tax credits (33,882) (54,080) (6,965)
Allowance for equity funds used during construction (3,567) (4,001) (3,627)
Changes in working capital:
Receivables (39,209) 10,817 7,385
Fuel inventory (22,895) 17,359 173
Accounts payable 55,732 (32,114) 20,608
Taxes accrued (5,080) 2,226 (21,983)
Interest accrued (824) (346) 201
Other working capital accounts (28,375) 20,324 26,486
Decommissioning trust contributions (16,702) (11,581) (11,491)
Provision for estimated losses and reserves 2,849 16,617 1,963
Other 6,055 (4,744) (41,826)
---------------- ---------------- ----------------
Net cash flow provided by operating activities 338,358 355,577 346,276
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (165,071) (179,116) (176,540)
Allowance for equity funds used during construction 3,567 4,001 3,627
Nuclear fuel purchases (41,219) (40,074) (29,156)
Proceeds from sale/leaseback of nuclear fuel 41,832 40,074 29,156
---------------- ---------------- ----------------
Net cash flow used in investing activities (160,891) (175,115) (172,913)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from issuance of:
First mortgage bonds - - 445,000
Other long-term debt 118,662 27,992 48,070
Retirement of:
First mortgage bonds (25,800) (800) (441,141)
Other long-term debt (124,025) (30,231) (47,700)
Redemption of preferred stock (9,500) (11,500) (15,500)
Changes in short-term borrowings (34,000) 12,605 17,395
Dividends paid:
Common stock (153,400) (80,000) (156,300)
Preferred stock (18,362) (19,597) (21,362)
---------------- ---------------- ----------------
Net cash flow used in financing activities (246,425) (101,531) (171,538)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents (68,958) 78,931 1,825
Cash and cash equivalents at beginning of period 80,756 1,825 -
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 11,798 $ 80,756 $ 1,825
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 102,851 $ 98,787 $ 103,826
Income taxes $ 113,080 $ 79,553 $ 66,366
Noncash investing and financing activities:
Capital lease obligations incurred $ - $ 47,719 $ 48,513
Change in unrealized appreciation/depreciation of
decommissioning trust assets $ 9,128 $ 1,361 $ -
See Notes to Financial Statements.
</TABLE>
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 4,438,519 $ 4,293,097
Property under capital leases 48,968 56,135
Construction work in progress 119,874 136,701
Nuclear fuel under capital lease 98,691 94,628
------------ ------------
Total 4,706,052 4,580,561
Less - accumulated depreciation and amortization 1,846,112 1,710,216
------------ ------------
Utility plant - net 2,859,940 2,870,345
------------ ------------
Other Property and Investments:
Investment in subsidiary companies - at equity 11,122 11,215
Decommissioning trust fund 166,832 127,136
Other - at cost (less accumulated depreciation) 5,085 4,628
------------ ------------
Total 183,039 142,979
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 7,780 3,737
Temporary cash investments - at cost,
which approximates market:
Associated companies 908 4,713
Other 3,110 72,306
------------ ------------
Total cash and cash equivalents 11,798 80,756
Accounts receivable:
Customer (less allowance for doubtful accounts
of $2.1 million in 1995 and $2.0 million in 1994) 75,445 53,781
Associated companies 40,577 28,506
Other 6,962 11,181
Accrued unbilled revenues 93,556 83,863
Fuel inventory - at average cost 57,456 34,561
Materials and supplies - at average cost 75,030 79,886
Rate deferrals 131,634 113,630
Deferred excess capacity 11,088 8,414
Deferred nuclear refueling outage costs 32,824 -
Prepayments and other 15,215 23,867
------------ ------------
Total 551,585 518,445
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals 228,390 360,496
Deferred excess capacity 5,984 20,060
SFAS 109 regulatory asset - net 219,906 227,068
Unamortized loss on reacquired debt 58,684 57,344
Other regulatory assets 68,160 68,813
Other 28,727 26,665
------------ ------------
Total 609,851 760,446
------------ ------------
TOTAL $ 4,204,415 $ 4,292,215
============ ============
See Notes to Financial Statements.
</TABLE>
ARKANSAS POWER & LIGHT COMPANY
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, $0.01 par value, authorized
325,000,000 shares; issued and outstanding
46,980,196 shares in 1995 and 1994 $ 470 $ 470
Paid-in capital 590,844 590,844
Retained earnings 492,386 491,799
------------ ------------
Total common shareholder's equity 1,083,700 1,083,113
Preferred stock:
Without sinking fund 176,350 176,350
With sinking fund 49,027 58,527
Long-term debt 1,281,203 1,293,879
------------ ------------
Total 2,590,280 2,611,869
------------ ------------
Other Noncurrent Liabilities:
Obligations under capital leases 93,574 94,534
Other 67,444 68,235
------------ ------------
Total 161,018 162,769
------------ ------------
Current Liabilities:
Currently maturing long-term debt 28,700 28,175
Notes payable 667 34,667
Accounts payable:
Associated companies 42,156 17,345
Other 120,250 89,329
Customer deposits 18,594 17,113
Taxes accrued 40,159 45,239
Accumulated deferred income taxes 48,992 25,043
Interest accrued 30,240 31,064
Co-owner advances 34,450 20,639
Deferred fuel cost 17,837 20,254
Nuclear refueling reserve - 37,954
Obligations under capital leases 54,697 56,154
Other 30,696 50,359
------------ ------------
Total 467,438 473,335
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 823,471 859,558
Accumulated deferred investment tax credits 112,890 118,548
Other 49,318 66,136
------------ ------------
Total 985,679 1,044,242
------------ ------------
Commitments and Contingencies (Notes 2, 8, and 9)
TOTAL $ 4,204,415 $ 4,292,215
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 491,799 $ 448,811 $ 420,691
Add:
Net income 172,080 142,263 205,297
------------------- ------------------- -------------------
Total 663,879 591,074 625,988
------------------- ------------------- -------------------
Deduct:
Dividends declared:
Preferred stock 18,093 19,275 20,877
Common stock 153,400 80,000 156,300
------------------- ------------------- -------------------
Total 171,493 99,275 177,177
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 492,386 $ 491,799 $ 448,811
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $1,648,233 $1,590,742 $1,591,568 $1,521,129 $1,528,270
Income before cumulative $136,665 $142,263 $155,110 $130,529 $143,451
effect of accounting
changes
Total assets $4,204,415 $4,292,215 $4,334,105 $4,038,811 $4,192,020
Long-term obligations (1) $1,423,804 $1,446,940 $1,478,203 $1,453,588 $1,670,678
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt),
preferred stock with sinking fund, and noncurrent capital lease
obligations.
See Notes 1, 3, and 10 for the effect of accounting changes in
1995 and 1993 .
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
Electric Operating
Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 542,862 $ 506,160 $ 528,734 $ 476,090 $ 494,375
Commercial 318,475 307,296 306,742 291,367 289,291
Industrial 362,854 338,988 336,856 325,569 324,632
Governmental 17,084 16,698 16,670 17,700 19,731
-------- -------- -------- -------- --------
Total retail 1,241,275 1,169,142 1,189,002 1,110,726 1,128,029
Sales for resale
Associated 178,885 212,314 175,784 203,470 209,343
companies
Non-associated 195,844 182,920 203,696 181,558 164,392
companies
Other 32,229 26,366 23,086 25,375 26,506
-------- -------- -------- -------- --------
Total $ 1,648,233 $1,590,742 $1,591,568 $1,521,129 $1,528,270
======== ======== ======== ======== ========
Billed Electric
Energy
Sales (Millions of
KWh):
Residential 5,868 5,522 5,680 5,102 5,564
Commercial 4,267 4,147 4,067 3,841 3,967
Industrial 6,314 5,941 5,690 5,509 5,565
Governmental 243 231 230 248 290
-------- -------- -------- -------- --------
Total retail 16,692 15,841 15,667 14,700 15,386
Sales for resale
Associated 8,386 10,591 8,307 10,357 11,250
companies
Non-associated 5,066 4,906 5,643 5,056 4,837
companies
-------- -------- -------- -------- --------
Total 30,144 31,338 29,617 30,113 31,473
======== ======== ======== ======== ========
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
Gulf States Utilities Company
We have audited the accompanying balance sheets of Gulf States
Utilities Company as of December 31, 1995 and 1994 and the related
statements of income (loss), retained earnings and paid-in-capital and
cash flows for each of the three years in the period ended December 31,
1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for each of the three years in the period ended December
31, 1995 in conformity with generally accepted accounting principles.
As discussed in Note 2 to the financial statements, the net
amount of capitalized costs for its River Bend Unit I Nuclear Generating
Plant (River Bend) exceed those costs currently being recovered through
rates. At December 31, 1995, approximately $482 million is not currently
being recovered through rates. If current regulatory and court orders
are not modified, a write-off of all or a portion of such costs may be
required. Additionally, other rate-related contingencies exist which may
result in refunds of revenues previously collected. The extent of such
write-off of capitalized River Bend costs or refunds of revenues previously
collected, if any, will not be determined until appropriate rate
proceedings and court appeals have been concluded. Accordingly, the
accompanying financial statements do not include any adjustments or
provision for write-off or refund that might result from the outcome of
these uncertainties. As also discussed in Note 2, approximately $187
million of additional deferred River Bend operating costs which exceed
those costs currently being recovered through rates are expected to be
written-off upon the adoption of Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of." Adoption of this
Statement is required on January 1, 1996.
As discussed in Note 8 to the financial statements, civil actions
have been initiated against Gulf States Utilities Company to, among
other things, recover the co-owner's investment in River Bend and to
annul the River Bend Joint Ownership Participation and Operating
Agreement. The ultimate outcome of these proceedings cannot presently
be determined.
As discussed in Note 13 to the financial statements, the common
stock of the Company was acquired on December 31, 1993.
As discussed in Note 3 to the financial statements, in 1993, the
Company adopted Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes." As discussed in Note 10 to the
financial statements, the Company adopted Statement of Financial
Accounting Standards No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions," as of January 1, 1993. As discussed in
Note 1 to the financial statements, as of January 1, 1993, the Company
began accruing revenues for energy delivered to customers but not yet
billed.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
GULF STATES UTILITIES COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income increased in 1995 principally as the result of an
increase in electric operating revenues, a decrease in other operation
and maintenance expenses, and an increase in other income. These
changes were partially offset by higher income taxes.
Net income decreased in 1994 due primarily to write-offs and
charges associated with the resolution of contingencies and additional
Merger-related costs aggregating $137 million, a base rate reduction
ordered by the PUCT applied retroactively to March 1994, and
restructuring costs. See Note 2 and Note 11 for additional
information.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales," "Expenses," and "Other"
below.
Revenues and Sales
See "SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON," following
the notes to financial statements, for information on operating
revenues by source and KWh sales.
The changes in electric operating revenues for the twelve months
ended December 31, 1995, are as follows:
Increase/
Description (Decrease)
------------------------- ---------
(In Millions)
Change in base revenues $32.0
Fuel cost recovery (29.6)
Sales volume/weather 35.0
Other revenue (including unbilled) 1.1
Sales for resale 31.3
-------
Total $69.8
=======
Electric operating revenues increased in 1995 primarily due to
increased sales volume/weather and higher sales for resale. These
increases were partially offset by lower fuel adjustment revenues,
which do not affect net income. Base revenues also increased in 1995
as a result of rate refund reserves established in 1994, as discussed
below, which were subsequently reduced as a result of an amended PUCT
order. The increase in base revenues was partially offset by rate
reductions in effect for Texas and Louisiana. Sales volume/weather
increased because of warmer than normal weather and an increase in
usage by all customer classes. Sales for resale increased as a result
of changes in generation availability and requirements among the
Operating Companies.
Electric operating revenues decreased in 1994 due primarily to a
base rate reduction ordered by the PUCT applied retroactively to March
1994, see Note 2 for additional information, and lower retail fuel
revenues partially offset by increased wholesale revenues associated
with higher sales for resale and increased retail base revenue. The
decrease in retail revenues is primarily due to a decrease in fuel
recovery revenue and a November 1993 rate reduction in Texas. Energy
sales increased due primarily to higher sales for resale as a result of
GSU's participation in the System power pool.
<PAGE>
GULF STATES UTILITIES COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Gas operating revenues decreased for 1995 primarily due to a
decrease in residential sales. This decrease was the result of a
milder winter than in 1994.
Expenses
Operating expenses decreased in 1995 as a result of lower other
operation and maintenance expenses and purchased power expenses,
partially offset by higher income taxes. Other operation and
maintenance expenses decreased primarily due to charges made in 1994
for Merger-related costs, restructuring costs, and certain pre-
acquisition contingencies including unfunded Cajun-River Bend costs and
environmental clean-up costs. Purchased power expenses decreased
because of the availability of less expensive gas and nuclear fuel for
use in electric generation as well as changes in the generation
requirements among the Operating Companies. In addition, the decrease
in purchased power expenses in 1995 was the result of the recording of
a provision for refund of disallowed purchased power expenses in 1994.
Income taxes increased primarily due to higher pre-tax income in 1995.
Operating expenses increased in 1994 due primarily to higher
purchased power and other operation and maintenance expenses, partially
offset by lower fuel for electric generation and fuel-related expense
and lower income tax expense. Purchased power expenses increased in
1994 due to GSU's participation in joint dispatch through the System
power pool resulting from increased energy sales as discussed above.
The increase in purchased power expenses in 1994 was also due to the
recording of a provision for refund of disallowed purchased power costs
resulting from a Louisiana Supreme Court ruling. Fuel, fuel-related
expenses, and gas purchased for resale decreased in 1994 primarily due
to lower gas prices.
Other operation and maintenance expenses increased in 1994 due
primarily to charges associated with certain pre-acquisition
contingencies, additional Merger-related costs and restructuring costs
as discussed in Note 11.
Income taxes decreased in 1994 due primarily to lower pretax
income resulting from the charges discussed above.
Other
Other miscellaneous income increased in 1995 as the result of
certain adjustments made in 1994 related to pre-acquisition
contingencies including Cajun-River Bend litigation (see Note 8 for
additional information) the write-off of previously disallowed rate
deferrals, and plant held for future use. As a result of these
charges, income taxes on other income were significantly higher in 1995
compared to 1994.
Other miscellaneous income decreased in 1994 due to the write-off
of plant held for future use, establishment of a reserve related to the
Cajun-River Bend litigation, the write-off of previously disallowed
rate deferrals, and obsolete spare parts. These charges were partially
offset by lower interest expense as a result of the continued
refinancing of high-cost debt.
Income taxes decreased in 1994 due primarily to the charges
discussed above.
<PAGE>
GULF STATES UTILITIES COMPANY
STATEMENTS OF INCOME (LOSS)
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------------------------------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues:
Electric $ 1,788,964 $ 1,719,201 $ 1,747,961
Natural gas 23,715 31,605 32,466
Steam products 49,295 46,559 47,193
-------------------- -------------------- --------------------
Total 1,861,974 1,797,365 1,827,620
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel, fuel-related expenses, and
gas purchased for resale 516,812 517,177 559,416
Purchased power 169,767 192,937 123,949
Nuclear refueling outage expenses 10,607 12,684 10,706
Other operation and maintenance 432,647 505,701 469,664
Depreciation, amortization, and decommissioning 202,224 197,151 190,405
Taxes other than income taxes 102,228 98,096 95,742
Income taxes 57,235 (6,448) 46,007
Amortization of rate deferrals 66,025 66,416 61,115
-------------------- -------------------- --------------------
Total 1,557,545 1,583,714 1,557,004
-------------------- -------------------- --------------------
Operating Income 304,429 213,651 270,616
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 1,125 1,334 726
Write-off of plant held for future use - (85,476) -
Miscellaneous - net 22,573 (64,843) 19,996
Income taxes (6,009) 55,638 (12,009)
-------------------- -------------------- --------------------
Total 17,689 (93,347) 8,713
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 191,341 195,414 202,235
Other interest - net 8,884 8,720 8,364
Allowance for borrowed funds used
during construction (1,026) (1,075) (731)
-------------------- -------------------- --------------------
Total 199,199 203,059 209,868
-------------------- -------------------- --------------------
Income (Loss) before Extraordinary Items and
the Cumulative Effect of an Accounting Change 122,919 (82,755) 69,461
Extraordinary Items (net of income taxes) - - (1,259)
Cumulative Effect of an Accounting
Change (net of income taxes) - - 10,660
-------------------- -------------------- --------------------
Net Income (Loss) 122,919 (82,755) 78,862
Preferred and Preference Stock
Dividend Requirements and Other 29,643 29,919 35,581
-------------------- -------------------- --------------------
Earnings (Loss) Applicable to Common Stock $ 93,276 $ (112,674) $ 43,281
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
GULF STATES UTILITIES COMPANY
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income (loss) $ 122,919 $ (82,755) $ 78,862
Noncash items included in net income:
Extraordinary items - - 1,259
Cumulative effect of a change in accounting principle - - (10,660)
Change in rate deferrals 66,025 96,979 61,115
Depreciation, amortization, and decommissioning 202,224 197,151 190,405
Deferred income taxes and investment tax credits 63,231 (62,171) 41,302
Allowance for equity funds used during construction (1,125) (1,334) (726)
Write-off of plant held for future use - 85,476 -
Changes in working capital:
Receivables 40,193 (72,341) 6,879
Fuel inventory (6,357) (2,336) (2,289)
Accounts payable (4,820) 60,112 11,072
Taxes accrued 24,935 (10,378) 3,764
Interest accrued 1,510 (4,189) (2,497)
Reserve for rate refund (56,972) 56,972 -
Other working capital accounts (40,919) 33,781 (9,915)
Decommissioning trust contributions (8,147) (3,202) (2,710)
Purchased power settlement - - (169,300)
Provision for estimated losses and reserves 10,119 4,181 20,349
Other (12,062) 30,413 38,525
---------------- ---------------- ----------------
Net cash flow provided by operating activities 400,754 326,359 255,435
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (185,944) (155,989) (115,481)
Allowance for equity funds used during construction 1,125 1,334 726
Nuclear fuel purchases (1,425) (31,178) (2,118)
Proceeds from sale/leaseback of nuclear fuel 542 29,386 2,118
Refund of escrow account and other property - - 5,921
---------------- ---------------- ----------------
Net cash flow used in investing activities (185,702) (156,447) (108,834)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of:
First mortgage bonds - - 338,379
Other long-term debt 2,277 101,109 21,440
Preference stock - - 146,625
Retirement of:
First mortgage bonds - - (360,199)
Other long-term debt (50,425) (102,425) (18,398)
Redemption of preferred and preference stock (7,283) (6,070) (174,841)
Dividends paid:
Common stock - (289,100) -
Preferred and preference stock (29,661) (30,131) (35,999)
---------------- ---------------- ----------------
Net cash flow used in financing activities (85,092) (326,617) (82,993)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents 129,960 (156,705) 63,608
Cash and cash equivalents at beginning of period 104,644 261,349 197,741
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 234,604 $ 104,644 $ 261,349
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 187,918 $ 191,850 $ 197,058
Income taxes $ 208 $ 251 $ 15,600
Noncash investing and financing activities:
Capital lease obligations incurred - $ 31,178 $ 17,143
Change in unrealized appreciation/depreciation of
decommissioning trust assets $ 2,121 $ (915) -
See Notes to Financial Statements.
</TABLE>
<PAGE>
GULF STATES UTILITIES COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 6,942,983 $ 6,842,726
Natural gas 45,789 44,505
Steam products 77,551 77,307
Property under capital leases 77,918 82,914
Construction work in progress 148,043 96,176
Nuclear fuel under capital lease 69,853 80,042
------------ ------------
Total 7,362,137 7,223,670
Less - accumulated depreciation and amortization 2,664,943 2,504,826
------------ ------------
Utility plant - net 4,697,194 4,718,844
------------ ------------
Other Property and Investments:
Decommissioning trust fund 32,943 21,309
Other - at cost (less accumulated depreciation) 28,626 29,315
------------ ------------
Total 61,569 50,624
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 13,751 8,063
Temporary cash investments - at cost,
which approximates market:
Associated companies 46,336 5,085
Other 174,517 91,496
------------ ------------
Total cash and cash equivalents 234,604 104,644
Accounts receivable:
Customer (less allowance for doubtful accounts
of $1.6 million in 1995 and $0.7 million in 1994) 110,187 167,745
Associated companies 1,395 12,732
Other 15,497 20,706
Accrued unbilled revenues 73,381 39,470
Deferred fuel costs 31,154 6,314
Accumulated deferred income taxes 43,465 49,457
Fuel inventory 32,141 25,784
Materials and supplies - at average cost 91,288 90,054
Rate deferrals 97,164 100,478
Prepayments and other 15,566 13,754
------------ ------------
Total 745,842 631,138
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals 419,904 506,974
SFAS 109 regulatory asset-net 453,628 426,358
Unamortized loss on reacquired debt 61,233 63,994
Other regulatory assets 27,836 35,168
Long-term receivables 224,727 264,752
Other 169,125 145,609
------------ ------------
Total 1,356,453 1,442,855
------------ ------------
TOTAL $ 6,861,058 $ 6,843,461
============ ============
See Notes to Financial Statements.
</TABLE>
GULF STATES UTILITIES COMPANY
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, no par value, authorized
200,000,000 shares; issued and outstanding
100 shares in 1995 and 1994 $ 114,055 $ 114,055
Paid-in capital 1,152,505 1,152,336
Retained earnings 357,704 264,626
------------ ------------
Total common shareholder's equity 1,624,264 1,531,017
Preference stock 150,000 150,000
Preferred stock:
Without sinking fund 136,444 136,444
With sinking fund 87,654 94,934
Long-term debt 2,175,471 2,318,417
------------ ------------
Total 4,173,833 4,230,812
------------ ------------
Other Noncurrent Liabilities:
Obligations under capital leases 108,078 125,691
Other 78,245 68,753
------------ ------------
Total 186,323 194,444
------------ ------------
Current Liabilities:
Currently maturing long-term debt 145,425 50,425
Accounts payable:
Associated companies 31,349 31,722
Other 136,528 140,975
Customer deposits 21,983 22,216
Taxes accrued 37,413 12,478
Interest accrued 56,837 55,327
Nuclear refueling reserve 22,627 10,117
Obligations under capital lease 37,773 37,265
Reserve for rate refund - 56,972
Other 86,653 111,963
------------ ------------
Total 576,588 529,460
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 1,177,144 1,100,396
Accumulated deferred investment tax credits 208,618 199,428
Deferred River Bend finance charges 58,047 82,406
Other 480,505 506,515
------------ ------------
Total 1,924,314 1,888,745
------------ ------------
Commitments and Contingencies (Notes 2, 8, and 9)
TOTAL $ 6,861,058 $ 6,843,461
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
GULF STATES UTILITIES COMPANY
STATEMENTS OF RETAINED EARNINGS AND PAID-IN CAPITAL
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 264,626 $ 666,401 $ 631,462
Add:
Net income (loss) 122,919 (82,755) 78,862
------------------- ------------------- -------------------
Total 387,545 583,646 710,324
------------------- ------------------- -------------------
Deduct:
Dividends declared:
Preferred and preference stock 29,482 29,831 35,581
Common stock - 289,100 -
Preferred and preference stock
redemption and other 359 89 8,342
------------------- ------------------- -------------------
Total 29,841 319,020 43,923
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 357,704 $ 264,626 $ 666,401
=================== =================== ===================
Paid-in Capital, January 1 $ 1,152,336 $ 1,152,304 $ 67,316
Add:
Issuance of 100 shares of no par common
stock with a stated value of $114,055
net of the retirement of 114,055,065 shares
of no par common stock - - 1,086,868
Gain (loss) on reacquisition of
preferred and preference stock 169 32 (1,880)
------------------- ------------------- -------------------
Paid-in Capital, December 31 $ 1,152,505 $ 1,152,336 $ 1,152,304
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
GULF STATES UTILITIES COMPANY
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $1,861,974 $1,797,365 $1,827,620 $1,773,374 $1,702,235
Income (loss) before
extraordinary items and
the cumulative effect of
accounting changes $122,919 $(82,755) $69,461 $139,413 $112,391
Total assets $6,861,058 $6,843,461 $7,137,351 $7,164,447 $7,183,119
Long-term obligations (1) $2,521,203 $2,689,042 $2,772,002 $2,798,768 $2,816,577
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt),
preferred and preference stock with sinking fund, and noncurrent
capital lease obligations.
See Notes 1 and 10 for the effect of accounting changes in 1993
and Notes 2 and 8 regarding River Bend rate appeals and
litigation with Cajun.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
Electric Operating
Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 573,566 $ 569,997 $ 585,799 $ 560,552 $ 547,147
Commercial 412,601 414,929 415,267 400,803 383,883
Industrial 604,688 626,047 650,230 642,298 582,568
Governmental 25,042 25,242 26,118 26,195 24,792
-------- -------- -------- -------- --------
Total retail 1,615,897 1,636,215 1,677,414 1,629,848 1,538,390
Sales for resale
Associated companies 62,431 45,263 - - -
Non-associated 67,103 52,967 31,898 24,485 44,136
companies
Other (1) 43,533 (15,244) 38,649 40,203 41,433
-------- -------- -------- -------- --------
Total $ 1,788,964 $ 1,719,201 $ 1,747,961 $ 1,694,536 $ 1,623,959
========= ========= ========= ========= =========
Billed Electric Energy
Sales (Millions of KWh):
Residential 7,699 7,351 7,192 6,825 6,925
Commercial 6,219 6,089 5,711 5,474 5,460
Industrial 15,393 15,026 14,294 14,413 13,629
Governmental 311 297 296 302 295
-------- -------- -------- -------- --------
Total retail 29,622 28,763 27,493 27,014 26,309
Sales for resale
Associated companies 2,935 1,866 - - -
Non-associated 2,212 1,650 666 540 1,049
companies
-------- -------- -------- -------- --------
Total Electric 34,769 32,279 28,159 27,554 27,358
Department
Steam Department 1,742 1,659 1,597 1,722 1,711
-------- -------- -------- -------- --------
Total 36,511 33,938 29,756 29,276 29,069
========= ========= ======== ======== ========
</TABLE>
(1) 1994 includes the effects of a GSU reserve for rate refund.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
Louisiana Power & Light Company
We have audited the accompanying balance sheets of Louisiana Power
& Light Company as of December 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits. The financial
statements of the Company for the year ended December 31, 1993, were
audited by other auditors, whose report, dated February 11, 1994,
expressed an unqualified opinion on these financial statements.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and the Board of Directors of
Louisiana Power & Light Company:
We have audited the accompanying statements of income, retained
earnings, and cash flows of Louisiana Power & Light Company (LP&L) for
the year ended December 31, 1993. These financial statements are the
responsibility of LP&L's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the results of LP&L's operations and its cash flows
for the year ended December 31, 1993 in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income decreased in 1995 due to an April 1995 rate reduction
and higher income taxes, partially offset by lower other operation and
maintenance expenses. Net income increased in 1994 due primarily to
the fourth quarter write-off of unamortized balances of deferred
investment tax credits, partially offset by lower operating revenues
and higher other operation and maintenance expenses.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales" and "Expenses" below.
Revenues and Sales
See "SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON," following
the notes to financial statements, for information on operating
revenues by source and KWh sales.
The changes in operating revenues for the twelve months ended
December 31, 1995, are as follows:
Increase/
Description (Decrease)
------------------------ --------------
(In Millions)
Change in base revenues $(29.9)
Fuel cost recovery (35.9)
Sales volume/weather 40.7
Other revenue (including unbilled) (23.3)
Sales for resale 12.9
-------
Total $(35.5)
=======
Operating revenues were lower in 1995 due primarily to a base rate
reduction in the second quarter of 1995 and to lower fuel adjustment
revenues, which do not affect net income. This decrease was partially
offset by increased customer usage, principally caused by warmer summer
weather. The completion of the amortization of proceeds from
litigation with a gas supplier in the second quarter of 1994 also
contributed to the decrease in other revenue, partially offset by
higher sales to non-associated utilities.
Operating revenues were lower in 1994 due primarily to the
completion of the amortization of the proceeds resulting from
litigation with a gas supplier in the second quarter and lower
wholesale revenues partially offset by higher retail revenues.
Wholesale revenues decreased due primarily to lower sales to non-
associated utilities. Retail revenues increased due primarily to
increases in sales to industrial and commercial customers.
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Expenses
Operating expenses decreased in 1995 due to decreases in fuel
expenses, including purchased power, and other operation and
maintenance expenses, partially offset by an increase in depreciation
and income taxes. The decrease in fuel expenses is due to lower fuel
prices partially offset by an increase in generation. Other operation
and maintenance expenses decreased because of lower payroll-related
expenses as a result of the restructuring program discussed in Note 11,
power plant waste water site closures in 1994, and a court settlement
reducing legal expense. Depreciation expense increased due to capital
improvements to distribution lines and substations and to an increase
in the depreciation rate associated with Waterford 3. Income taxes
increased due to the write-off in 1994 of deferred investment tax
credits in accordance with the 1994 FERC Settlement, a decrease in tax
depreciation associated with Waterford 3, and higher pre-tax income.
Operating expenses decreased in 1994 due primarily to a decrease
in income tax expense as a result of the write-off of deferred
investment tax credits pursuant to a FERC settlement and lower fuel
expenses partially offset by higher other operation and maintenance
expenses. The decrease in fuel and purchased power expenses is due
primarily to lower fuel and purchased power prices. The increase in
other operation and maintenance expenses is due primarily to
restructuring costs and power plant waste water site closures.
Interest expense decreased in 1994 as a result of the retirement and
refinancing of high-cost debt.
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------- - -------------------- - --------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues $ 1,674,875 $ 1,710,415 $ 1,731,541
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel and fuel-related expenses 300,015 331,422 338,670
Purchased power 351,583 366,564 381,252
Nuclear refueling outage expenses 17,675 18,187 18,380
Other operation and maintenance 311,535 350,854 342,195
Depreciation, amortization, and decommissioning 161,023 151,994 142,051
Taxes other than income taxes 55,867 56,101 50,391
Income taxes 116,486 63,751 108,568
Amortization of rate deferrals 28,422 28,422 28,422
-------------------- -------------------- --------------------
Total 1,342,606 1,367,295 1,409,929
-------------------- -------------------- --------------------
Operating Income 332,269 343,120 321,612
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 1,950 3,486 2,581
Miscellaneous - net 2,831 747 2,069
Income taxes (628) 463 (2,245)
-------------------- -------------------- --------------------
Total 4,153 4,696 2,405
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 129,691 129,952 130,352
Other interest - net 7,210 6,494 6,605
Allowance for borrowed funds used
during construction (2,016) (2,469) (1,748)
-------------------- -------------------- --------------------
Total 134,885 133,977 135,209
-------------------- -------------------- --------------------
Net Income 201,537 213,839 188,808
Preferred Stock Dividend Requirements
and Other 21,307 23,319 24,754
-------------------- -------------------- --------------------
Earnings Applicable to Common Stock $ 180,230 $ 190,520 $ 164,054
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 201,537 $ 213,839 $ 188,808
Noncash items included in net income:
Change in rate deferrals 28,422 28,422 28,422
Depreciation, amortization, and decommissioning 161,023 151,994 142,051
Deferred income taxes and investment tax credits 2,450 (15,972) 40,262
Allowance for equity funds used during construction (1,950) (3,486) (2,581)
Amortization of deferred revenues - (14,632) (42,470)
Changes in working capital:
Receivables (8,069) 1,094 (8,046)
Accounts payable 4,420 (6,811) (28,198)
Taxes accrued 20,472 (16,970) 6,861
Interest accrued 1,215 846 1,003
Other working capital accounts (16,993) 31,064 15,205
Refunds to customers - gas contract settlement - - (56,027)
Decommissioning trust contributions (7,493) (4,815) (4,000)
Other (377) 3,048 18,298
---------------- ---------------- ----------------
Net cash flow provided by operating activities 384,657 367,621 299,588
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (120,244) (140,669) (163,142)
Allowance for equity funds used during construction 1,950 3,486 2,581
Nuclear fuel purchases (44,707) - -
Proceeds from sale/leaseback of nuclear fuel 47,293 - -
---------------- ---------------- ----------------
Net cash flow used in investing activities (115,708) (137,183) (160,561)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of:
First mortgage bonds - - 100,000
Other long-term debt 16,577 19,946 58,000
Retirement of:
First mortgage bonds (75,000) (25,000) (100,919)
Other long-term debt (308) (322) (22,052)
Redemption of preferred stock (11,256) (15,038) (22,500)
Changes in short-term borrowings 49,305 (24,887) 52,041
Dividends paid:
Common stock (221,500) (167,100) (167,600)
Preferred stock (21,115) (22,808) (25,290)
---------------- ---------------- ----------------
Net cash flow used in financing activities (263,297) (235,209) (128,320)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents 5,652 (4,771) 10,707
Cash and cash equivalents at beginning of period 28,718 33,489 22,782
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 34,370 $ 28,718 $ 33,489
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 128,485 $ 128,000 $ 127,497
Income taxes $ 96,066 $ 96,442 $ 62,414
Noncash investing and financing activities:
Capital lease obligations incurred - 9,677 $ 33,210
Change in unrealized appreciation/depreciation of
decommissioning trust assets $ 2,304 $ (1,129) -
See Notes to Financial Statements.
</TABLE>
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 4,886,898 $ 4,778,126
Property under capital leases 231,121 229,468
Construction work in progress 87,567 94,791
Nuclear fuel under capital lease 72,864 44,238
Nuclear fuel 1,506 6,420
------------ ------------
Total 5,279,956 5,153,043
Less - accumulated depreciation and amortization 1,742,306 1,600,510
------------ ------------
Utility plant - net 3,537,650 3,552,533
------------ ------------
Other Property and Investments:
Nonutility property 20,060 20,060
Decommissioning trust fund 38,560 27,076
Investment in subsidiary companies - at equity 14,230 14,230
Other 1,113 1,078
------------ ------------
Total 73,963 62,444
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 3,952 -
Temporary cash investments - at cost,
which approximates market 30,418 28,718
------------ ------------
Total cash and cash equivalents 34,370 28,718
Accounts receivable:
Customer (less allowance for doubtful accounts of
$1.4 million in 1995 and $1.2 million in 1994) 72,328 58,858
Associated companies 8,033 9,827
Other 8,979 11,609
Accrued unbilled revenues 62,132 63,109
Deferred fuel costs 10,200 -
Accumulated deferred income taxes - 3,702
Materials and supplies - at average cost 79,799 89,692
Rate deferrals 25,609 28,422
Deferred nuclear refueling outage costs 21,344 15,041
Prepayments and other 9,118 13,487
------------ ------------
Total 331,912 322,465
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals - 25,609
SFAS 109 regulatory asset - net 301,520 379,263
Unamortized loss on reacquired debt 39,474 43,656
Other regulatory assets 23,935 25,736
Other 23,069 23,733
------------ ------------
Total 387,998 497,997
------------ ------------
TOTAL $ 4,331,523 $ 4,435,439
============ ============
See Notes to Financial Statements.
</TABLE>
LOUISIANA POWER & LIGHT COMPANY
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, $0.01 par value, authorized
250,000,000 shares; issued and outstanding
165,173,180 shares in 1995 and 1994 $ 1,088,900 $ 1,088,900
Capital stock expense and other (4,836) (5,367)
Retained earnings 72,150 113,420
------------ ------------
Total common shareholder's equity 1,156,214 1,196,953
Preferred stock:
Without sinking fund 160,500 160,500
With sinking fund 100,009 111,265
Long-term debt 1,385,171 1,403,055
------------ ------------
Total 2,801,894 2,871,773
------------ ------------
Other Noncurrent Liabilities:
Obligations under capital leases 43,362 16,238
Other 50,835 54,216
------------ ------------
Total 94,197 70,454
------------ ------------
Current Liabilities:
Currently maturing long-term debt 35,260 75,320
Notes payable
Associated companies 61,459 7,954
Other 15,000 19,200
Accounts payable:
Associated companies 37,494 20,793
Other 69,922 82,203
Customer deposits 56,924 54,934
Taxes accrued 18,612 (1,860)
Accumulated deferred income taxes 3,366 -
Interest accrued 44,202 42,987
Dividends declared 5,149 5,489
Deferred fuel cost - 13,983
Obligations under capital leases 28,000 28,000
Other 17,397 20,156
------------ ------------
Total 392,785 369,159
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 807,278 883,945
Accumulated deferred investment tax credits 145,561 151,259
Deferred interest - Waterford 3 lease obligation 23,947 26,000
Other 65,861 62,849
------------ ------------
Total 1,042,647 1,124,053
------------ ------------
Commitments and Contingencies (Notes 2, 8, and 9)
TOTAL $ 4,331,523 $ 4,435,439
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 113,420 $ 89,849 $ 94,510
Add:
Net income 201,537 213,839 188,808
------------------- ------------------- -------------------
Total 314,957 303,688 283,318
------------------- ------------------- -------------------
Deduct:
Dividends declared:
Preferred stock 20,775 22,359 24,553
Common stock 221,500 167,100 167,600
Capital stock expenses 532 809 1,316
------------------- ------------------- -------------------
Total 242,807 190,268 193,469
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 72,150 $ 113,420 $ 89,849
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $1,674,875 $1,710,415 $1,731,541 $1,553,745 $1,528,934
Net income $201,537 $213,839 $188,808 $182,989 $166,572
Total assets $4,331,523 $ 4,435,439 $4,463,998 $4,109,148 $4,131,751
Long-term obligations (1) $1,528,542 $1,530,558 $1,611,436 $1,622,909 $1,582,606
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt),
preferred stock with sinking fund, and noncurrent capital lease
obligations.
See Notes 3 and 10 for the effect of accounting changes in 1993.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
Electric Operating
Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 583,373 $ 577,084 $ 572,738 $ 518,255 $ 525,594
Commercial 353,582 358,672 345,254 320,688 318,613
Industrial 641,196 659,061 652,574 578,741 558,036
Governmental 31,616 31,679 29,723 27,780 28,303
--------- --------- --------- --------- ---------
Total retail 1,609,767 1,626,496 1,600,289 1,445,464 1,430,546
Sales for resale
Associated 1,178 352 4,849 5,454 182
companies
Non-associated 48,987 36,928 46,414 33,178 31,815
companies
Other 14,943 46,639 79,989 69,649 66,391
--------- --------- --------- --------- ---------
Total $ 1,674,875 $1,710,415 $1,731,541 $1,553,745 $1,528,934
Billed Electric ========= ========= ========= ========= =========
Energy
Sales (Millions of KWh):
Residential 7,855 7,449 7,368 6,996 7,182
Commercial 4,786 4,631 4,435 4,307 4,367
Industrial 16,971 16,561 15,914 15,013 14,832
Governmental 439 423 398 385 405
------- ------- ------- ------- -------
Total retail 30,051 29,064 28,115 26,701 26,786
Sales for resale
Associated 44 10 112 204 6
companies
Non-associated 1,293 776 1,213 1,101 1,195
companies
------- ------- ------- ------- -------
Total 31,388 29,850 29,440 28,006 27,987
======= ======= ======= ======= =======
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
Mississippi Power & Light Company
We have audited the accompanying balance sheets of Mississippi
Power & Light Company as of December 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits. The financial
statements of the Company for the year ended December 31, 1993, were
audited by other auditors, whose report, dated February 11, 1994,
included an explanatory paragraph that described a change in the method
of accounting for revenues, which is discussed in Note 1 to these
financial statements.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and the Board of Directors of
Mississippi Power & Light Company:
We have audited the accompanying statements of income, retained
earnings, and cash flows of Mississippi Power & Light Company (MP&L)
for the year ended December 31, 1993. These financial statements are
the responsibility of MP&L's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the results of MP&L's operations and its cash flows
for the year ended December 31, 1993 in conformity with generally
accepted accounting principles.
As discussed in Note 1 to the financial statements, MP&L changed
its method of accounting for revenues in 1993.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income increased in 1995 primarily due to increased revenues
and a decrease in other operation and maintenance expenses partially
offset by an increase in income tax expense. Net income decreased in
1994 due primarily to the onetime recording in the first quarter of
1993 of the cumulative effect of the change in accounting principle for
unbilled revenues. In addition, net income was reduced by the rate
reduction in connection with the formula incentive-rate plan, partially
offset by a FERC settlement.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales," "Expenses," and "Other"
below.
Revenues and Sales
See "SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON," following
the notes to financial statements, for information on operating
revenues by source and KWh sales.
The changes in electric operating revenues for the twelve months
ended December 31, 1995, are as follows:
Increase/
Description (Decrease)
------------------------ -------------
(In Millions)
Change in base revenues $(6.1)
Grand Gulf Rate Rider (0.6)
Fuel cost recovery 12.8
Sales volume/weather 14.9
Other revenue (including unbilled) 5.6
Sales for resale 3.4
------
Total $30.0
======
Operating revenues increased in 1995 primarily due to an increase
in retail and wholesale energy sales and higher fuel adjustment
revenues, partially offset by rate reductions. Retail energy sales
increased primarily due to the impact of weather and increased customer
usage. Fuel adjustment revenues increased in response to higher fuel
costs and do not impact net income. Operating revenues decreased in
1994 due to the impact of the rate reduction in connection with the
incentive-rate plan that went into effect in March 1994, partially
offset by higher energy sales. In addition to the factors cited above
for revenues, accrued unbilled revenues decreased due to a change in
the cycle billing dates offset by an increase in billed revenues. This
decrease was partially offset by increased commercial and industrial
retail sales.
Expenses
Operating expenses increased in 1995 due primarily to an increase
in income tax expense partially offset by a decrease in other operation
and maintenance expenses. Operating expenses increased in 1994 due
primarily to increased amortization of rate deferrals partially offset
by lower fuel/purchased power and income tax expenses.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Income tax expense increased in 1995 due primarily to the 1994
write-off of unamortized deferred investment tax credits and higher
pretax income in 1995. Income taxes decreased in 1994 due primary to
lower pretax income, and the write-off of unamortized deferred
investment tax credits in accordance with a FERC settlement.
Other operation and maintenance expense decreased in 1995 due
primarily to 1994 Merger-related costs allocated to MP&L and payroll
expenses. No significant Merger-related costs were allocated to MP&L
during the current year. Payroll expenses decreased as a result of the
restructuring program announced and accrued for during the third
quarter of 1994. The restructuring program included a reduction in the
number of MP&L employees during 1995. In addition, maintenance expenses
decreased at various power plants.
Purchased power expense decreased in 1994 due primarily to changes
in generation availability and requirements among the Operating
Companies and a lower per unit price for power purchased.
The amortization of rate deferrals increased in 1994 reflecting
the fact that MP&L, based on the Revised Plan, collected more Grand
Gulf 1-related costs from its customers in 1994 than in 1993.
Other
Interest expense decreased in 1994 due primarily to the retirement
and refinancing of high-cost debt.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------- - -------------------- - --------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues $ 889,843 $ 859,845 $ 883,818
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel and fuel-related expenses 163,198 164,428 135,258
Purchased power 240,519 235,019 289,016
Other operation and maintenance 144,183 156,954 156,405
Depreciation and amortization 38,197 36,592 32,152
Taxes other than income taxes 46,019 43,963 41,878
Income taxes 33,716 16,651 33,074
Amortization of rate deferrals 107,339 110,481 70,715
-------------------- -------------------- --------------------
Total 773,171 764,088 758,498
-------------------- -------------------- --------------------
Operating Income 116,672 95,757 125,320
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 950 1,660 928
Miscellaneous - net 3,036 (1,117) 948
Income taxes - (debit) (1,161) 4,176 (3,462)
-------------------- -------------------- --------------------
Total 2,825 4,719 (1,586)
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 46,998 47,835 53,558
Other interest - net 4,638 4,929 1,802
Allowance for borrowed funds used
during construction (806) (1,067) (663)
-------------------- -------------------- --------------------
Total 50,830 51,697 54,697
-------------------- -------------------- --------------------
Income before the Cumulative Effect
of an Accounting Change 68,667 48,779 69,037
Cumulative Effect of an Accounting
Change (net of income taxes) - - 32,706
-------------------- -------------------- --------------------
Net Income 68,667 48,779 101,743
Preferred Stock Dividend Requirements
and Other 7,515 7,624 9,160
-------------------- -------------------- --------------------
Earnings Applicable to Common Stock $ 61,152 $ 41,155 $ 92,583
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 68,667 $ 48,779 $ 101,743
Noncash items included in net income:
Cumulative effect of a change in accounting principle - - (32,706)
Change in rate deferrals 114,304 109,105 71,555
Depreciation and amortization 38,197 36,592 32,152
Deferred income taxes and investment tax credits (36,774) (34,409) (17,881)
Allowance for equity funds used during construction (950) (1,660) (928)
Changes in working capital:
Receivables (5,277) 33,154 (11,814)
Fuel inventory (1,901) 3,872 (1,327)
Accounts payable 15,553 (8,783) 5,055
Taxes accrued 7,818 (3,431) (4,200)
Interest accrued 1,457 (2,794) 780
Other working capital accounts (21,108) 13,480 (1,120)
Other 4,957 1,209 8,073
---------------- ---------------- ----------------
Net cash flow provided by operating activities 184,943 195,114 149,382
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (79,146) (121,386) (66,404)
Allowance for equity funds used during construction 950 1,660 928
---------------- ---------------- ----------------
Net cash flow used in investing activities (78,196) (119,726) (65,476)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of:
General and refunding bonds 79,480 24,534 250,000
Other long-term debt - 15,652 -
Retirement of:
General and refunding bonds (45,000) (30,000) (55,000)
First mortgage bonds (20,000) (18,000) (204,501)
Other long-term debt (965) (16,045) (230)
Redemption of preferred stock (15,000) (15,000) (16,500)
Changes in short-term borrowings (30,000) 18,432 11,568
Dividends paid:
Common stock (61,700) (45,600) (85,800)
Preferred stock (6,215) (7,762) (9,452)
---------------- ---------------- ----------------
Net cash flow used in financing activities (99,400) (73,789) (109,915)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents 7,347 1,599 (26,009)
Cash and cash equivalents at beginning of period 9,598 7,999 34,008
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 16,945 $ 9,598 $ 7,999
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 48,617 $ 52,737 $ 52,459
Income taxes $ 67,746 $ 39,000 $ 58,831
See Notes to Financial Statements.
</TABLE>
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 1,559,955 $ 1,475,322
Construction work in progress 55,443 67,119
------------ ------------
Total 1,615,398 1,542,441
Less - accumulated depreciation and amortization 613,712 582,514
------------ ------------
Utility plant - net 1,001,686 959,927
------------ ------------
Other Property and Investments:
Investment in subsidiary companies - at equity 5,531 5,531
Other 5,615 5,624
------------ ------------
Total 11,146 11,155
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 2,574 5,080
Temporary cash investments - at cost,
which approximates market:
Associated companies 3,248 276
Other 11,123 4,242
------------ ------------
Total cash and cash equivalents 16,945 9,598
Accounts receivable:
Customer (less allowance for doubtful accounts of
$1.6 million in 1995 and $2.1 million in 1994) 46,214 43,846
Associated companies 1,134 4,680
Other 1,967 2,789
Accrued unbilled revenues 47,150 39,873
Fuel inventory - at average cost 6,681 4,780
Materials and supplies - at average cost 19,233 20,642
Rate deferrals 130,622 114,921
Prepayments and other 11,536 10,672
------------ ------------
Total 281,482 251,801
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals 247,072 377,077
Unamortized loss on reacquired debt 10,105 10,488
Other regulatory assets 17,736 18,811
SFAS 109 regulatory asset - net 6,445 -
Other 6,311 8,569
------------ ------------
Total 287,669 414,945
------------ ------------
TOTAL $ 1,581,983 $ 1,637,828
============ ============
See Notes to Financial Statements.
</TABLE>
MISSISSIPPI POWER & LIGHT COMPANY
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, no par value, authorized
15,000,000 shares; issued and outstanding
8,666,357 shares in 1995 and 1994 $ 199,326 $ 199,326
Capital stock expense and other (218) (1,762)
Retained earnings 231,463 232,011
------------ ------------
Total common shareholder's equity 430,571 429,575
Preferred stock:
Without sinking fund 57,881 57,881
With sinking fund 16,770 31,770
Long-term debt 494,404 475,233
------------ ------------
Total 999,626 994,459
------------ ------------
Other Noncurrent Liabilities 11,625 9,536
------------ ------------
Current Liabilities:
Currently maturing long-term debt 61,015 65,965
Notes payable - 30,000
Accounts payable:
Associated companies 24,391 2,350
Other 32,100 38,588
Customer deposits 24,339 22,793
Taxes accrued 28,639 20,821
Accumulated deferred income taxes 54,090 47,515
Interest accrued 21,834 20,377
Other 6,875 30,318
------------ ------------
Total 253,283 278,727
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 278,581 301,288
Accumulated deferred investment tax credits 27,978 29,528
SFAS 109 regulatory liability - net - 13,099
Other 10,890 11,191
------------ ------------
Total 317,449 355,106
------------ ------------
Commitments and Contingencies (Notes 2 and 8)
TOTAL $ 1,581,983 $ 1,637,828
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 232,011 $ 236,337 $ 230,201
Add:
Net income 68,667 48,779 101,743
------------------- ------------------- -------------------
Total 300,678 285,116 331,944
------------------- ------------------- -------------------
Deduct:
Dividends declared:
Preferred stock 5,971 7,404 8,964
Common stock 61,700 45,600 85,800
Preferred stock expenses 1,544 101 843
------------------- ------------------- -------------------
Total 69,215 53,105 95,607
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 231,463 $ 232,011 $ 236,337
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $889,843 $859,845 $883,818 $ 799,483 $762,338
Income before
cumulative effect
of a change in
accounting
principle $68,667 $48,779 $69,037 $65,036 $63,088
Total assets $1,581,983 $1,637,828 $1,681,992 $ 1,665,480 $1,692,382
Long-term $511,613 $507,555 $563,612 $ 576,787 $576,599
obligations (1)
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt),
preferred stock with sinking fund, and noncurrent capital lease
obligations.
See Notes 1, 3, and 9 for the effect of accounting changes in
1993.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
Electric Operating Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 336,194 $ 332,567 $ 341,620 $ 309,614 $ 306,675
Commercial 262,786 257,154 251,285 236,191 229,073
Industrial 178,466 184,637 182,060 169,977 161,494
Governmental 27,410 27,495 28,530 26,377 25,567
------- ------- ------- ------- -------
Total retail 804,856 801,853 803,495 742,159 722,809
Sales for resale
Associated 35,928 37,747 34,640 17,988 9,781
companies
Non-associated 21,906 16,728 21,100 19,995 15,706
companies
Other 27,153 3,517 24,583 19,341 14,042
------- ------- ------- ------- -------
Total $ 889,843 $ 859,845 $ 883,818 $ 799,483 $ 762,338
======= ======= ======= ======= =======
Billed Electric
Energy
Sales (Millions of KWh):
Residential 4,233 4,014 3,983 3,644 3,739
Commercial 3,368 3,151 2,928 2,804 2,807
Industrial 3,044 2,985 2,787 2,631 2,582
Governmental 336 330 336 318 321
------- ------- ------- ------- ------
Total retail 10,981 10,480 10,034 9,397 9,449
Sales for resale
Associated
companies 959 1,079 758 253 376
Non-associated
companies 692 512 670 937 656
------- ------- ------- ------- -------
Total 12,632 12,071 11,462 10,587 10,481
======= ======= ======= ======= =======
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
New Orleans Public Service Inc.
We have audited the accompanying balance sheets of New Orleans
Public Service Inc. as of December 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits. The financial
statements of the Company for the year ended December 31, 1993, were
audited by other auditors, whose report, dated February 11, 1994,
included an explanatory paragraph that described a change in the method
of accounting for revenues, which is discussed in Note 1 to these
financial statements.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and the Board of Directors of
New Orleans Public Service Inc.
We have audited the accompanying statements of income, retained
earnings, and cash flows of New Orleans Public Service Inc. (NOPSI) for
the year ended December 31, 1993. These financial statements are the
responsibility of NOPSI's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the results of NOPSI's operations and its cash flows
for the year ended December 31, 1993 in conformity with generally
accepted accounting principles.
As discussed in Note 1 to the financial statements, NOPSI changed
its method of accounting for revenues in 1993.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income increased in 1995 principally due to 1994 refunds
associated with the 1994 NOPSI Settlement and a decrease in other
operation and maintenance expense, partially offset by a permanent
rate reduction that took place January 1, 1995. Net income decreased
in 1994 due to the effects of the 1994 NOPSI Settlement and the one-
time recording of the cumulative effect of the change in accounting
principle for unbilled revenues in 1993, partially offset by lower
operating expenses. See Note 2 for a discussion of the 1994 NOPSI
Settlement.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues and Sales" and "Expenses" below.
Revenues and Sales
See "SELECTED FINANCIAL DATA-FIVE-YEAR COMPARISON," following the
notes to financial statements, for information on electric operating
revenues by source and KWh sales.
The changes in electric operating revenues for the twelve months
ended December 31, 1995, are as follows:
Increase/
Description (Decrease)
-------------------- -------------
(In Millions)
Change in base revenues $12.2
Fuel cost recovery (0.3)
Sales volume/weather 12.5
Other revenue (including 6.1
unbilled)
Sales for resale 3.5
------
Total $34.0
======
Electric operating revenues increased in 1995 as a result of
refunds in 1994 associated with the 1994 NOPSI Settlement and an
increase in energy sales. The increase in energy sales is primarily
due to weather effects on retail sales and an increase in sales for
resale. Electric operating revenues decreased in 1994 due primarily
to the effects of the 1994 NOPSI Settlement as discussed in Note 2.
Electric energy sales increased slightly in 1994.
Gas operating revenues decreased in 1995 primarily due to the
rate reduction agreed to in the NOPSI Settlement effective January 1,
1995, and a lower unit purchase price for gas purchased for resale.
Gas operating revenues decreased slightly in 1994 as a result of lower
gas sales.
Expenses
Operating expenses increased in 1995 due primarily to an increase
in income taxes and the increased amortization of rate deferrals,
partially offset by a decrease in fuel and other operation and
maintenance expenses. Fuel expenses decreased in 1995 primarily due
to a decrease in fuel prices. Other operation and maintenance
expenses decreased primarily due to a decrease in maintenance activity
and lower payroll expenses. The decrease in payroll expenses is the
result of the 1994 restructuring and the related decrease in
employees. Operating expenses decreased in 1994 due primarily to
lower purchased power expenses and lower income tax expenses.
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Purchased power expenses decreased in 1994 due primarily to
changes in generation availability and requirements among the
Operating Companies and lower costs.
Gas purchased for resale decreased in 1995 due lower gas prices.
Gas purchased for resale decreased in 1994 due to decreased gas sales.
Income taxes increased in 1995 as a result of lower pretax income
in 1994 due to the 1994 NOPSI Settlement and the write-off of the
unamortized balances of deferred investment tax credits pursuant to
the FERC Settlement in 1994. Income taxes decreased in 1994 due
primarily to lower pretax income, resulting from the 1994 NOPSI
Settlement, and the write-off of the unamortized balances of deferred
investment tax credits pursuant to the FERC Settlement.
The increases in the amortization of rate deferrals in 1995 and
1994 are primarily a result of the collection of larger amounts of
previously deferred costs under the 1991 NOPSI Settlement, which
allowed NOPSI to record an additional $90 million of previously
incurred Grand Gulf 1-related costs.
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------- - -------------------- - --------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues:
Electric $ 394,394 $ 360,430 $ 423,830
Natural gas 80,276 87,357 90,992
-------------------- -------------------- --------------------
Total 474,670 447,787 514,822
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel, fuel-related expenses
and gas purchased for resale 102,314 113,735 112,451
Purchased power 145,920 145,935 165,963
Other operation and maintenance 76,510 80,656 87,797
Depreciation and amortization 19,420 19,275 17,284
Taxes other than income taxes 27,805 27,814 26,643
Income taxes 19,836 3,602 24,232
Rate deferrals:
Rate deferrals - - (1,651)
Amortization of rate deferrals 31,971 27,009 22,351
-------------------- -------------------- --------------------
Total 423,776 418,026 455,070
-------------------- -------------------- --------------------
Operating Income 50,894 29,761 59,752
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 158 331 141
Miscellaneous - net 1,639 2,141 (1,055)
Income taxes (631) (998) (1,115)
-------------------- -------------------- --------------------
Total 1,166 1,474 (2,029)
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 15,948 17,092 20,076
Other interest - net 1,853 1,179 1,016
Allowance for borrowed funds used
during construction (127) (247) (130)
-------------------- -------------------- --------------------
Total 17,674 18,024 20,962
-------------------- -------------------- --------------------
Income before the Cumulative Effect
of an Accounting Change 34,386 13,211 36,761
Cumulative Effect of an Accounting
Change (net of income taxes) - - 10,948
-------------------- -------------------- --------------------
Net Income 34,386 13,211 47,709
Preferred Stock Dividend Requirements
and Other 1,411 1,581 1,768
-------------------- -------------------- --------------------
Earnings Applicable to Common Stock $ 32,975 $ 11,630 $ 45,941
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 34,386 $ 13,211 $ 47,709
Noncash items included in net income:
Cumulative effect of a change in accounting principle - - (10,948)
Change in rate deferrals 31,564 24,106 15,842
Depreciation and amortization 19,420 19,275 17,284
Deferred income taxes and investment tax credits (1,998) (18,006) (2,132)
Allowance for equity funds used during construction (158) (331) (141)
Changes in working capital:
Receivables (5,468) 15,362 (6,725)
Accounts payable 12,566 (19,132) 1,169
Taxes accrued 3,225 (2,832) (82)
Interest accrued (131) (230) (1,319)
Income tax receivable 20,172 (20,172) -
Other working capital accounts (4,803) 18,454 1,365
Other (9,500) 8,851 8,345
---------------- ---------------- ----------------
Net cash flow provided by operating activities 99,275 38,556 70,367
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (27,836) (22,777) (24,813)
Allowance for equity funds used during construction 158 331 141
---------------- ---------------- ----------------
Net cash flow used in investing activities (27,678) (22,446) (24,672)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of general
and refunding bonds 29,805 - 100,000
Retirement of:
First mortgage bonds - - (56,823)
General and refunding bonds (24,200) (15,000) (44,400)
Redemption of preferred stock (3,525) (1,500) (1,500)
Dividends paid:
Common stock (30,600) (33,300) (43,900)
Preferred stock (1,362) (1,596) (1,825)
---------------- ---------------- ----------------
Net cash flow used in financing activities (29,882) (51,396) (48,448)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents 41,715 (35,286) (2,753)
Cash and cash equivalents at beginning of period 8,031 43,317 46,070
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 49,746 $ 8,031 $ 43,317
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 17,187 $ 17,707 $ 21,953
Income taxes (refund) - net $ (941) $ 45,984 $ 25,661
See Notes to Financial Statements.
</TABLE>
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 483,581 $ 470,560
Natural gas 121,083 119,508
Construction work in progress 17,525 7,284
------------ ------------
Total 622,189 597,352
Less - accumulated depreciation and amortization 335,021 319,576
------------ ------------
Utility plant - net 287,168 277,776
------------ ------------
Other Property and Investments:
Investment in subsidiary companies - at equity 3,259 3,259
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 1,693 849
Temporary cash investments - at cost,
which approximates market:
Associated companies 10,860 2,472
Other 37,193 4,710
------------ ------------
Total cash and cash equivalents 49,746 8,031
Accounts receivable:
Customer (less allowance for doubtful accounts
of $0.5 in 1995 and $0.8 million in 1994) 29,168 23,938
Associated companies 551 3,503
Other 843 600
Accrued unbilled revenues 17,242 14,295
Deferred electric fuel and resale gas costs 2,647 856
Materials and supplies - at average cost 8,950 9,676
Rate deferrals 35,191 31,544
Income tax receivable - 20,172
Prepayments and other 4,529 5,636
------------ ------------
Total 148,867 118,251
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
Rate deferrals 137,916 173,127
SFAS 109 regulatory asset-net 6,813 8,792
Unamortized loss on reacquired debt 1,932 2,361
Other regulatory assets 9,204 5,647
Other 1,047 3,681
------------ ------------
Total 156,912 193,608
------------ ------------
TOTAL $ 596,206 $ 592,894
============ ============
See Notes to Financial Statements.
</TABLE>
NEW ORLEANS PUBLIC SERVICE INC.
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, $4 par value, authorized
10,000,000 shares; issued and outstanding
8,435,900 shares in 1995 and 1994 $ 33,744 $ 33,744
Paid-in capital 36,306 36,201
Retained earnings subsequent to the elimination of
the accumulated deficit on November 30, 1988 81,261 78,886
------------ ------------
Total common shareholder's equity 151,311 148,831
Preferred stock:
Without sinking fund 19,780 19,780
With sinking fund - 3,450
Long-term debt 155,958 164,160
------------ ------------
Total 327,049 336,221
------------ ------------
Other Noncurrent Liabilities 17,745 19,063
------------ ------------
Current Liabilities:
Currently maturing long-term debt 38,250 24,200
Accounts payable:
Associated companies 13,851 6,456
Other 24,674 19,503
Customer deposits 18,214 17,422
Accumulated deferred income taxes 9,174 4,925
Taxes accrued 5,554 2,329
Interest accrued 5,111 5,242
Other 14,345 19,982
------------ ------------
Total 129,173 100,059
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 81,654 89,246
Accumulated deferred investment tax credits 8,618 9,251
Other 31,967 39,054
------------ ------------
Total 122,239 137,551
------------ ------------
Commitments and Contingencies (Notes 2 and 8)
TOTAL $ 596,206 $ 592,894
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 78,886 $ 100,556 $ 98,560
Add:
Net income 34,386 13,211 47,709
------------------- ------------------- -------------------
Total 113,272 113,767 146,269
------------------- ------------------- -------------------
Deduct:
Dividends declared:
Preferred stock 1,231 1,536 1,768
Common stock 30,600 33,300 43,900
Capital stock expenses 180 45 45
------------------- ------------------- -------------------
Total 32,011 34,881 45,713
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 81,261 $ 78,886 $ 100,556
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $474,670 $447,787 $514,822 $464,879 $476,165
Income before $34,386 $13,211 $36,761 $26,424 $ 74,699
cumulative effect
of a change in
accounting
principle
Total assets $596,206 $592,894 $647,605 $621,691 $ 685,217
Long-term $155,958 $167,610 $193,262 $165,917 $ 231,901
obligations (1)
</TABLE>
(1) Includes long-term debt (excluding currently maturing debt) and
preferred stock with sinking fund.
See Notes 1, 3, and 9 for the effect of accounting changes in
1993.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(In Thousands)
Electric Operating
Revenues:
<S> <C> <C> <C> <C> <C>
Residential $ 141,353 $ 142,013 $ 151,423 $ 137,668 $ 136,030
Commercial 144,374 162,410 167,788 160,229 159,118
Industrial 22,842 25,422 26,205 23,860 24,062
Governmental 52,880 58,726 61,548 56,023 55,097
------- -------- -------- -------- -------
Total retail 361,449 388,571 406,964 377,780 374,307
Sales for resale
Associated 3,217 2,061 2,487 3,086 2,759
companies
Non-associated 9,864 7,512 9,291 7,234 7,046
companies
Other (1) 19,864 (37,714) 5,088 3,836 15,102
------- -------- -------- -------- -------
Total $ 394,394 $ 360,430 $ 423,830 $ 391,936 $ 399,214
======= ======= ======= ======= =======
Billed Electric
Energy
Sales (Millions of KWh):
Residential 2,049 1,896 1,914 1,806 1,844
Commercial 2,079 2,031 1,989 1,977 2,023
Industrial 537 518 499 457 487
Governmental 983 951 924 888 887
------- -------- -------- -------- -------
Total retail 5,648 5,396 5,326 5,128 5,241
Sales for resale
Associated 149 92 89 155 145
companies
Non-associated 297 202 262 250 273
companies
------- -------- -------- -------- -------
Total 6,094 5,690 5,677 5,533 5,659
======= ======= ======= ======= =======
</TABLE>
(1) 1994 includes the effects of the 1994 NOPSI Settlement.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholder of
System Energy Resources, Inc.
We have audited the accompanying balance sheets of System Energy
Resources, Inc. as of December 31, 1995 and 1994, and the related
statements of income, retained earnings and cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits. The financial
statements of the Company for the year ended December 31, 1993, were
audited by other auditors, whose report, dated February 11, 1994,
expressed an unqualified opinion on these financial statements.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the Company
as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for the years then ended in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and the Board of Directors of
System Energy Resources, Inc.
We have audited the accompanying statements of income, retained
earnings, and cash flows of System Energy Resources, Inc. (System
Energy) for the year ended December 31, 1993. These financial
statements are the responsibility of System Energy's management. Our
responsibility is to express an opinion on these financial statements
based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the results of System Energy's operations and its
cash flows for the year ended December 31, 1993 in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994 (November 30, 1994 as to Note 2,
"Rate and Regulatory Matters - FERC Settlement")
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
MANAGEMENT'S FINANCIAL DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Net Income
Net income increased in 1995 primarily due to the effect of the
FERC Settlement which reduced 1994 net income by $80.2 million. See
Note 2 for a discussion of the FERC Settlement. This was partially
offset by revenues being adversely impacted by a lower return on
System Energy's decreasing investment in Grand Gulf 1. These factors
also resulted in the decrease in 1994 net income.
Significant factors affecting the results of operations and
causing variances between the years 1995 and 1994, and 1994 and 1993,
are discussed under "Revenues" and "Expenses" below.
Revenues
Operating revenues increased in 1995 due primarily to the effect
of the FERC Settlement on 1994 revenues as discussed in "Net Income"
above and the recovery of increased expenses in connection with a
Grand Gulf 1 refueling outage offset by a lower return on System
Energy's decreasing investment in Grand Gulf 1. Revenues attributable
to the return on investment are expected to continue to decline each
year as a result of the depreciation of System Energy's investment in
Grand Gulf 1.
Operating revenues decreased in 1994 due primarily to the effect
of the FERC Settlement as discussed in "Net Income" above, a lower
return on System Energy's decreasing investment in Grand Gulf 1, and
decreased operation and maintenance expenses. See Note 1 for a
description of the components of System Energy's operating revenues.
Expenses
Operating expenses increased in 1995 due primarily to higher
nuclear refueling outage expenses, higher depreciation, amortization,
and decommissioning, and higher income taxes, partially offset by
lower fuel expenses as a result of the refueling outage. Grand Gulf 1
was on-line for 285 days in 1995 as compared with 345 days in 1994.
The difference in the on-line days was primarily due to the unit's
seventh refueling outage that lasted from April 15, 1995, to June 21,
1995 (68 days), and, to a lesser extent, unplanned outages in 1995
totaling 12 days, compared to 20 days in 1994. Depreciation,
amortization, and decommissioning increased due to a $4 million
increase in amortization (as a result of the reclassification of $81
million of Grand Gulf 1 costs and the accelerated amortization of the
reclassified costs over a ten-year period in accordance with the 1994
FERC Settlement) and $1 million in decommissioning. Total income
taxes increased in 1995 due primarily to higher pretax book income.
Operating expenses decreased in 1994 due primarily to lower other
operation and maintenance expenses and lower income taxes. The lower
level of outages for 1994 increased fuel for electric generation, but
was partially offset by less expensive nuclear fuel and increased
operating efficiency. Nonfuel operation and maintenance expenses
decreased significantly in 1994 due to declines in contract work
expenses, employee benefits, and materials and supplies expenses.
Total income taxes decreased in 1994 due primarily to lower pretax
book income
Interest charges decreased in both 1995 and 1994 due primarily to
the retirement and refinancing of high-cost long-term debt partially
offset by interest associated with the FERC Settlement refunds.
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------- - -------------------- - --------------------
1995 1994 1993
-------------------- -------------------- --------------------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues $ 605,639 $ 474,963 $ 650,768
-------------------- -------------------- --------------------
Operating Expenses:
Operation and maintenance:
Fuel and fuel-related expenses 40,262 48,107 42,296
Nuclear refueling outage expenses 24,935 - 27,933
Other operation and maintenance 98,441 96,504 107,416
Depreciation, amortization, and decommissioning 100,747 93,861 90,920
Taxes other than income taxes 27,549 26,637 26,589
Income taxes 77,410 38,087 83,412
-------------------- -------------------- --------------------
Total 369,344 303,196 378,566
-------------------- -------------------- --------------------
Operating Income 236,295 171,767 272,202
-------------------- -------------------- --------------------
Other Income (Deductions):
Allowance for equity funds used
during construction 1,878 1,090 772
Miscellaneous - net 2,492 6,402 6,518
Income taxes 1,917 1,250 4,859
-------------------- -------------------- --------------------
Total 6,287 8,742 12,149
-------------------- -------------------- --------------------
Interest Charges:
Interest on long-term debt 143,020 169,248 189,338
Other interest - net 8,491 7,257 1,600
Allowance for borrowed funds used
during construction (1,968) (1,403) (514)
-------------------- -------------------- --------------------
Total 149,543 175,102 190,424
-------------------- -------------------- --------------------
Net Income $ 93,039 $ 5,407 $ 93,927
==================== ==================== ====================
See Notes to Financial Statements.
</TABLE>
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------- ---------------- ----------------
1995 1994 1993
---------------- ---------------- ----------------
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $ 93,039 $ 5,407 $ 93,927
Noncash items included in net income:
Depreciation, amortization, and decommissioning 100,747 93,861 90,920
Deferred income taxes and investment tax credits (45,337) (30,640) 15,832
Allowance for equity funds used during construction (1,878) (1,090) (772)
Changes in working capital:
Receivables (66,433) 48,411 6,199
Accounts payable (18,955) 35,469 (15,123)
Taxes accrued 37,266 14,430 (2,272)
Interest accrued (4,053) (8,133) (1,631)
Other working capital accounts (21,874) 14,024 2,832
Recoverable income taxes - 92,689 130,152
Decommissioning trust contributions (5,414) (5,157) (4,911)
FERC Settlement - refund obligation (3,540) 60,388 -
Provision for estimated losses and reserves 3,167 (2,371) 1,377
Other 29,725 19,699 1,526
---------------- ---------------- ----------------
Net cash flow provided by operating activities 96,460 336,987 318,056
---------------- ---------------- ----------------
Investing Activities:
Construction expenditures (21,747) (20,766) (23,083)
Allowance for equity funds used during construction 1,878 1,090 772
Nuclear fuel purchases (51,455) (26,414) (32,822)
Proceeds from sale/leaseback of nuclear fuel 52,188 - 32,822
---------------- ---------------- ----------------
Net cash flow used in investing activities (19,136) (46,090) (22,311)
---------------- ---------------- ----------------
Financing Activities:
Proceeds from the issuance of:
First mortgage bonds - 59,410 60,000
Other long-term debt 73,343 - -
Retirement of:
First mortgage bonds (105,000) (260,000) (108,308)
Other long-term debt (45,320) - -
Premium and expenses paid on refinancing sale/leaseback bonds - (48,436) -
Changes in short-term borrowings 2,990 - -
Common stock dividends paid (92,800) (148,300) (233,100)
---------------- ---------------- ----------------
Net cash flow used in financing activities (166,787) (397,326) (281,408)
---------------- ---------------- ----------------
Net increase (decrease) in cash and cash equivalents (89,463) (106,429) 14,337
Cash and cash equivalents at beginning of period 89,703 196,132 181,795
---------------- ---------------- ----------------
Cash and cash equivalents at end of period $ 240 $ 89,703 $ 196,132
================ ================ ================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest - net of amount capitalized $ 147,492 $ 176,503 $ 186,786
Income taxes (refund) $ 87,016 $ (39,586) $ (65,992)
Noncash investing and financing activities:
Capital lease obligation incurred - - $ 45,089
Change in unrealized appreciation/depreciation of
decommissioning trust assets $ 3,061 $ (1,515) -
See Notes to Financial Statements.
</TABLE>
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Utility Plant:
Electric $ 2,977,303 $ 2,939,384
Electric plant under lease 444,305 439,378
Construction work in progress 35,946 46,547
Nuclear fuel under capital lease 71,374 46,688
Nuclear fuel - 26,360
------------ ------------
Total 3,528,928 3,498,357
Less - accumulated depreciation and amortization 861,752 751,717
------------ ------------
Utility plant - net 2,667,176 2,746,640
------------ ------------
Other Property and Investments:
Decommissioning trust fund 40,927 30,359
------------ ------------
Current Assets:
Cash and cash equivalents:
Cash 240 -
Temporary cash investments - at cost,
which approximates market:
Associated companies - 5,489
Other - 84,214
------------ ------------
Total cash and cash equivalents 240 89,703
Accounts receivable:
Associated companies 72,458 7,450
Other 4,837 3,412
Materials and supplies - at average cost 67,661 71,991
Prepayments and other 16,050 5,429
------------ ------------
Total 161,246 177,985
------------ ------------
Deferred Debits and Other Assets:
Regulatory assets:
SFAS 109 regulatory asset-net 291,181 389,264
Unamortized loss on reacquired debt 52,702 54,577
Other regulatory assets 203,731 199,080
Other 14,049 15,454
------------ ------------
Total 561,663 658,375
------------ ------------
TOTAL $ 3,431,012 $ 3,613,359
============ ============
See Notes to Financial Statements.
</TABLE>
SYSTEM ENERGY RESOURCES, INC.
BALANCE SHEETS
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
December 31,
------------ ------------
1995 1994
------------ ------------
(In Thousands)
<S> <C> <C>
Capitalization:
Common stock, no par value, authorized
1,000,000 shares; issued and outstanding
789,350 shares in 1995 and 1994 $ 789,350 $ 789,350
Paid-in capital 7 7
Retained earnings 85,920 85,681
------------ ------------
Total common shareholder's equity 875,277 875,038
Long-term debt 1,219,917 1,438,305
------------ ------------
Total 2,095,194 2,313,343
------------ ------------
Other Noncurrent Liabilities:
Obligations under capital leases 44,107 18,688
Other 16,068 14,342
------------ ------------
60,175 33,030
------------ ------------
Current Liabilities:
Currently maturing long-term debt 250,000 105,000
Notes payable-associated companies 2,990 -
Accounts payable:
Associated companies 17,458 32,272
Other 19,063 23,204
Taxes accrued 72,648 35,382
Interest accrued 36,743 40,796
Obligations under capital lease 28,000 28,000
Other 4,211 19,794
------------ ------------
Total 431,113 284,448
------------ ------------
Deferred Credits:
Accumulated deferred income taxes 602,182 746,502
Accumulated deferred investment tax credits 107,119 110,584
FERC Settlement - refund obligation 56,848 60,388
Other 78,381 65,064
------------ ------------
Total 844,530 982,538
------------ ------------
Commitments and Contingencies (Notes 2, 8, and 9)
TOTAL $ 3,431,012 $ 3,613,359
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
For the Years Ended December 31,
-------------------------------------------------------------------
1995 1994 1993
------------------- ------------------- -------------------
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $ 85,681 $ 228,574 $ 367,747
Add:
Net income 93,039 5,407 93,927
------------------- ------------------- -------------------
Total 178,720 233,981 461,674
------------------- ------------------- -------------------
Deduct:
Dividends declared 92,800 148,300 233,100
------------------- ------------------- -------------------
Retained Earnings, December 31 (Note 7) $ 85,920 $ 85,681 $ 228,574
=================== =================== ===================
See Notes to Financial Statements.
</TABLE>
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
SELECTED FINANCIAL DATA - FIVE-YEAR COMPARISON
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C>
Operating revenues $605,639 $474,963 $650,768 $723,410 $ 686,664
Net income $93,039 $5,407 $93,927 $130,141 $ 104,622
Total assets $3,431,012 $3,613,359 $3,891,066 $3,672,441 $ 3,642,203
Long-term $1,264,024 $1,456,993 $1,536,593 $1,768,299 $ 1,707,471
obligations (1)
Electric energy
sales
(Millions of KWh) 7,212 8,653 7,113 7,354 8,220
</TABLE>
(1) Includes long-term debt (excluding current maturities) and
noncurrent capital lease obligations.
See Note 2 for information with respect to refunds and charges
resulting from the FERC Settlement in 1994 and Note 3 for the effect
of the accounting change for income taxes in 1993.
<PAGE>
ENTERGY CORPORATION AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Entergy
Corporation, AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy)
The accompanying consolidated financial statements include the
accounts of Entergy Corporation and its direct subsidiaries: AP&L, GSU,
LP&L, MP&L, NOPSI, System Energy, Entergy Services, Entergy Operations,
Entergy Power, Entergy Enterprises, System Fuels, Entergy S.A., Entergy
Argentina S.A., Entergy Power Marketing Corporation, Entergy Power
Development Corporation, Entergy Argentina S.A., Ltd., Entergy
Transener S.A., Entergy Power Development International Holdings, Inc.,
and Entergy Power Development International Holdings. A number of
these subsidiaries have additional subsidiaries.
Because the acquisition of GSU was consummated on December 31,
1993, under the purchase method of accounting, GSU's operations were
not included in the consolidated amounts for the year ended December
31, 1993. GSU is included in all of the consolidated financial
statements for 1994 and 1995. All references made to Entergy or the
System as of, and subsequent to, the Merger closing date include
amounts and information pertaining to GSU as an Entergy company. All
significant intercompany transactions have been eliminated. Entergy
Corporation's utility subsidiaries maintain accounts in accordance with
FERC and other regulatory guidelines. Certain previously reported
amounts have been reclassified to conform to current classifications
with no effect on net income or shareholders' equity.
Use of Estimates in the Preparation of Financial Statements
- - - - -----------------------------------------------------------
The preparation of Entergy Corporation and its subsidiaries'
financial statements, in conformity with generally accepted accounting
principles, requires management to make estimates and assumptions that
affect reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities as of December 31, 1995 and 1994, and
the reported amounts of revenues and expenses during fiscal years 1995,
1994, and 1993. Adjustments to the reported amounts of assets and
liabilities may be necessary in the future to the extent that future
estimates or actual results are different from the estimates used in
1995 financial statements.
Revenues and Fuel Costs
- - - - -----------------------
AP&L, LP&L, and MP&L generate, transmit, and distribute
electricity (primarily to retail customers) in the States of Arkansas,
Louisiana, and Mississippi, respectively. GSU generates, transmits, and
distributes electricity primarily to retail customers in the States of
Texas and Louisiana; distributes gas at retail in the City of Baton
Rouge, Louisiana, and vicinity; and also sells steam to a large
refinery complex in Baton Rouge. NOPSI sells both electricity and gas
to retail customers in the city of New Orleans (except for Algiers
where LP&L is the electricity supplier).
System Energy's operating revenues recover operating expenses,
depreciation, and capital costs attributable to Grand Gulf 1 from
AP&L, LP&L, MP&L, and NOPSI. Capital costs are computed by allowing a
return on System Energy's common equity funds allocable to its net
investment in Grand Gulf 1, plus System Energy's effective interest
cost for its debt allocable to its investment in Grand Gulf 1. See
Note 2 for a discussion of System Energy's proposed rate increase.
A portion of AP&L's and LP&L's purchase of power from Grand Gulf
has not been included in the determination of the cost of service to
retail customers by the APSC and LPSC, respectively, as described in
Note 2.
The Operating Companies accrue estimated revenues for energy
delivered since the latest billings. However, prior to January 1,
1993, AP&L, GSU, MP&L, and NOPSI recognized electric and gas revenues
when billed. To provide a better matching of revenues and expenses,
effective January 1, 1993, AP&L, GSU, MP&L, and NOPSI adopted a change
in accounting principle to provide for the accrual of estimated
unbilled revenues. The cumulative effect (excluding GSU) of this
accounting change as of January 1, 1993, increased System 1993 net
income by $93.8 million (net of income taxes of $57.2 million), or
$0.54 per share. The impacts on the individual operating companies are
shown below:
Net of Tax
Total Tax Effect
------------ ---------- ---------
(In Thousands)
AP&L $81,327 $31,140 $50,187
MP&L 52,162 19,456 32,706
NOPSI 17,540 6,592 10,948
------------ ---------- ---------
System $151,029 $57,188 $93,841
============= =========== ==========
In accordance with a LPSC rate order, GSU recorded a deferred
credit of $16.6 million for the January 1, 1993, amount of unbilled
revenues. See Note 2 regarding GSU's subsequent appeals of the LPSC
order regarding deferred unbilled revenues.
The Operating Companies' rate schedules (except GSU's Texas retail
rate schedules) include fuel adjustment clauses that allow either
current recovery or deferrals of fuel costs until such costs are
reflected in the related revenues. GSU's Texas retail rate schedules
include a fixed fuel factor approved by the PUCT, which remains in
effect until changed as part of a general rate case, fuel
reconciliation, or fixed fuel factor filing.
Utility Plant
- - - - -------------
Utility plant is stated at original cost. The original cost of
utility plant retired or removed, plus the applicable removal costs,
less salvage, is charged to accumulated depreciation. Maintenance,
repairs, and minor replacement costs are charged to operating expenses.
Substantially all of the utility plant is subject to liens of the
subsidiaries' mortgage bond indentures.
Utility plant includes the portions of Grand Gulf 1 and Waterford
3 that were sold and currently are leased back. For financial
reporting purposes, these sale and leaseback transactions are reflected
as financing transactions.
Net electric utility plant in service, by company and functional
category, as of December 31, 1995 (excluding owned and leased nuclear
fuel and the plant acquisition adjustment related to the Merger), is
shown below:
<TABLE>
<CAPTION>
Production Transmission Distribution Other Total
---------- ------------ ------------ ----- -----
( In Millions)
<S> <C> <C> <C> <C> <C>
AP&L $1,203 $424 $867 $147 $2,641
GSU 3,110 430 725 179 4,444
LP&L 2,303 239 766 68 3,376
MP&L 228 260 389 69 946
NOPSI 22 20 145 18 205
System Energy 2,534 12 - 14 2,560
System 9,532 1,387 2,892 593 14,404
</TABLE>
Depreciation is computed on the straight-line basis at rates based
on the estimated service lives and costs of removal of the various
classes of property. Depreciation rates on average depreciable
property are shown below:
<TABLE>
<CAPTION>
System
System AP&L GSU LP&L MP&L NOPSI Energy
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
1995 2.9% 3.3% 2.7% 3.0% 2.4% 3.1% 2.9%
1994 3.0% 3.4% 2.7% 3.0% 2.4% 3.1% 3.0%
1993 3.0% 3.4% 2.7% 3.0% 2.4% 3.1% 2.9%
</TABLE>
AFUDC represents the approximate net composite interest cost of
borrowed funds and a reasonable return on the equity funds used for
construction. Although AFUDC increases both utility plant and
earnings, it is only realized in cash through depreciation provisions
included in rates.
Jointly-Owned Generating Stations
- - - - ---------------------------------
Certain Entergy Corporation subsidiaries own undivided interests
in several jointly-owned electric generating facilities and record the
investments and expenses associated with these generating stations to
the extent of their respective ownership interests. As of December 31,
1995, the subsidiaries' investment and accumulated depreciation in each
of these generating stations were as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Total
Generating Fuel Megawatt Accumulated
Stations Type Capability Ownership Investment Depreciation
- - - - -------------- ----- --------- --------- ---------- -----------
(In Thousands)
AP&L
Independence Unit 1 Coal 836 31.50% $117,526 $40,733
Common Facilities Coal 15.75% 29,674 9,207
White Bluff Units 1&2 Coal 1,660 57.00% 398,292 157,008
GSU
River Bend Unit 1 Nuclear 936 70.00% 3,067,996 670,020
Roy S. Nelson Unit 6 Coal 550 70.00% 390,036 155,997
Big Cajun 2 Unit 3 Coal 540 42.00% 219,990 80,522
MP&L -
Independence Units 1&2 Coal 1,678 25.00% 221,512 75,482
Common Facilities Coal 3,326 91
System Energy
Grand Gulf Unit 1 Nuclear 1,143 90.00% 3,409,317 861,752
Entergy Power-
Independence Unit 2 Coal 842 31.50% 178,292 54,436
</TABLE>
Income Taxes
- - - - ------------
Entergy Corporation and its subsidiaries file a consolidated
federal income tax return. Income taxes are allocated to the System
companies in proportion to their contribution to consolidated taxable
income. SEC regulations require that no Entergy Corporation subsidiary
pay more taxes than it would have paid if a separate income tax return
had been filed. Deferred income taxes are recorded for all temporary
differences between the book and tax basis of assets and liabilities
and for certain credits available for carryforward.
Deferred tax assets are reduced by a valuation allowance when, in
the opinion of management, it is more likely than not that some portion
of the deferred tax assets will not be realized. Deferred tax assets
and liabilities are adjusted for the effects of changes in tax laws and
rates on the date of enactment.
Investment tax credits are deferred and amortized based upon the
average useful life of the related property in accordance with rate
treatment. As discussed in Note 3, in 1993 Entergy changed its
accounting for income taxes to conform with SFAS 109, "Accounting for
Income Taxes."
Acquisition Adjustment
- - - - ----------------------
Entergy Corporation, upon completion of the Merger in December
1993, recorded an acquisition adjustment in utility plant in the amount
of $380 million, representing the excess of the purchase price over the
historical cost of the GSU net assets acquired. During 1994, Entergy
recorded an additional $124 million of acquisition adjustment related
to the resolution of certain preacquisition contingencies and
appropriate allocation of purchase price.
The acquisition adjustment is being amortized on a straight-line
basis over a 31-year period beginning January 1, 1994, which
approximates the remaining average book life of the plant acquired as a
result of the Merger. As of December 31, 1995, the unamortized balance
of the acquisition adjustment was $472 million. The System anticipates
that its future net cash flows will be sufficient to recover such
amortization.
Reacquired Debt
- - - - ---------------
The premiums and costs associated with reacquired debt are being
amortized over the life of the related new issuances, in accordance
with ratemaking treatment.
Cash and Cash Equivalents
- - - - -------------------------
Entergy considers all unrestricted highly liquid debt instruments
purchased with an original maturity of three months or less to be cash
equivalents.
Continued Application of SFAS 71
- - - - --------------------------------
As a result of the EPAct, other Federal laws, and actions of
regulatory commissions, the electric utility industry is moving toward
a combination of competition and a modified regulatory environment.
The Operating Companies' and System Energy's financial statements
currently reflect, for the most part, assets and costs based on cost-
based ratemaking regulation, in accordance with SFAS 71, "Accounting
for the Effects of Certain Types of Regulation." Continued
applicability of SFAS 71 to the System's financial statements requires
that rates set by an independent regulator on a cost-of-service basis
(including a reasonable rate of return on invested capital) can
actually be charged to and collected from customers.
In the event either all or a portion of a utility's operations
cease to meet those criteria for various reasons, including
deregulation, a change in the method of regulation or a change in the
competitive environment for the utility's regulated services, the
utility should discontinue application of SFAS 71 for the relevant
portion. That discontinuation would be reported by elimination from
the balance sheet of the effects of any actions of regulators recorded
as regulatory assets and liabilities.
As of December 31, 1995, and for the foreseeable future, the
System's financial statements continue to follow SFAS 71, with the
exceptions noted below.
SFAS 101
- - - - --------
SFAS 101, "Accounting for the Discontinuation of Application of
FASB Statement No. 71," specifies how an enterprise that ceases to meet
the criteria for application of SFAS 71 to all or part of its
operations should report that event in its financial statements. GSU
discontinued regulatory accounting principles for its wholesale
jurisdiction and its steam department during 1989 and for the Louisiana
retail deregulated portion of River Bend in 1991. The results of
Entergy's deregulated operations (before interest charges) for the
years ended December 31, 1995, 1994, and 1993 are as follows:
<TABLE>
<CAPTION>
1995 1994 1993
------- ------- -------
(In Thousands)
<S> <C> <C> <C>
Operating Revenues Operating Expenses $141,171 $ 138,822 $141,399
Fuel, operating, and maintenance 105,733 116,386 120,177
Depreciation 31,129 27,890 28,554
Income taxes (2,914) (249) (4,411)
------- ------- -------
Total Operating Expenses 133,948 144,027 144,320
------- ------- -------
Net Income (Loss) From Deregulated
Utility Operations $ 7,223 $(5,205) $(2,921)
======== ======== ========
</TABLE>
SFAS 121
- - - - --------
In March 1995, the FASB issued SFAS 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of" (SFAS 121), which became effective January 1, 1996. This
statement describes circumstances that may result in assets (including
goodwill such as the Merger acquisition adjustment, discussed above)
being impaired. The statement also provides criteria for recognition
and measurement of asset impairment. Note 2 describes regulatory
assets of $169 million (net of tax) related to Texas retail deferred
River Bend operating and carrying costs. These deferred costs will
be required to be written off upon the adoption of SFAS 121.
Certain other assets and operations of the Operating Companies
totaling approximately $1.7 billion (pre-tax) could be
affected by SFAS 121 in the future. Those assets include AP&L's and
LP&L's retained shares of Grand Gulf 1, GSU's Louisiana deregulated
asset plan, and its Texas jurisdiction abeyed portion of the River Bend
plant, in addition to the wholesale jurisdiction and steam department
operations of GSU. As discussed above, GSU has previously discontinued
the application of SFAS 71 for the Louisiana deregulated asset plan,
operations under the wholesale jurisdiction, and the steam department.
Entergy periodically reviews these assets and operations in order
to determine if the carrying value of such assets will be recovered.
Generally, this determination is based on the net cash flows expected
to result from such operations and assets. Projected net cash flows
depend on the future operating costs associated with the assets, the
efficiency and availability of the assets and generating units, and the
future market and price for energy over the remaining life of the
assets. Based on current estimates of future cash flows as prescribed
under SFAS 121, management anticipates that future revenues from such
assets and operations of Entergy will fully recover all related costs.
Change in Accounting for Nuclear Refueling Outage Costs (Entergy
- - - - -------------------------------------------------------
Corporation and AP&L)
In December 1995, at the recommendation of FERC, AP&L changed its
method of accounting for nuclear refueling outage costs. The change,
effective January 1, 1995, results in AP&L deferring incremental
maintenance costs incurred during an outage and amortizing those costs
over the operating period immediately following the nuclear refueling
outage, which is the period that the charges are billed to customers.
Previously, estimated costs of refueling outages were accrued over the
period (generally 18 months) preceding each scheduled outage. The
effect of the change for the year ended December 31, 1995, was to
decrease net income by $5.1 million (net of income taxes of $3.3
million) or $.02 per share. The cumulative effect of the change was to
increase net income $35.4 million (net of income taxes of $22.9
million) or $.15 per share. The pro forma effects of the change in
accounting for nuclear refueling outages in 1994 and 1993, assuming the
new method was applied retroactively to those years, would have been to
decrease net income $3.2 million (net of income taxes of $2.1 million)
and $6.5 million (net of income taxes of $4.2 million), respectively, or
$.01 per share and $.04 per share, respectively.
Fair Value Disclosures
- - - - ----------------------
The estimated fair value of financial instruments was determined
using bid prices reported by dealer markets and by nationally
recognized investment banking firms. Considerable judgment is required
in developing the estimates of fair value. Therefore, estimates are
not necessarily indicative of the amounts that Entergy could realize in
a current market exchange. In addition, gains or losses realized on
financial instruments may be reflected in future rates and not accrue
to the benefit of stockholders.
Entergy considers the carrying amounts of financial instruments
classified as current assets and liabilities to be a reasonable
estimate of their fair value because of the short maturity of these
instruments. In addition, Entergy does not expect that performance of
its obligations will be required in connection with certain off-balance
sheet commitments and guarantees considered financial instruments. Due
to this factor, and because of the related-party nature of these
commitments and guarantees, determination of fair value is not
considered practicable. See Notes 5, 6, and 8 for additional
disclosure concerning fair value methodologies.
NOTE 2. RATE AND REGULATORY MATTERS
Merger-Related Rate Agreements (Entergy Corporation, AP&L, GSU, LP&L,
- - - - ------------------------------
MP&L, and NOPSI)
In November 1993, Entergy Corporation, AP&L, MP&L, and NOPSI
entered into separate settlement agreements whereby the APSC, MPSC, and
Council agreed to withdraw from the SEC proceeding related to the
Merger. In return AP&L, MP&L, and NOPSI agreed, among other things,
that their retail ratepayers would be protected from (1) increases in
the cost of capital resulting from risks associated with the Merger,
(2) recovery of any portion of the acquisition premium or transactional
costs associated with the Merger, (3) certain direct allocations of
costs associated with GSU's River Bend nuclear unit, and (4) any losses
of GSU resulting from resolution of litigation in connection with its
ownership of River Bend. AP&L and MP&L agreed not to request any
general retail rate increase that would take effect before November
1998, except for, among other things, increases associated with the
recovery of certain Grand Gulf 1-related costs, recovery of certain
taxes, and catastrophic events, and in the case of AP&L, excess
capacity costs and costs related to the adoption of SFAS 106 that were
previously deferred. MP&L agreed that retail base rates under the
formula rate plan would not be increased above November 1, 1993, levels
for a period of five years beginning November 9, 1993.
In 1993, the LPSC and the PUCT approved separate regulatory
proposals for GSU that include the following elements: (1) a five-year
Rate Cap on GSU's retail electric base rates in the respective states,
except for force majeure (defined to include, among other things, war,
natural catastrophes, and high inflation); (2) a provision for passing
through to retail customers the jurisdictional portion of the fuel
savings created by the Merger; and (3) a mechanism for tracking nonfuel
operation and maintenance savings created by the Merger. The LPSC
regulatory plan provides that such nonfuel savings will be shared 60%
by shareholders and 40% by ratepayers during the eight years following
the Merger. The LPSC plan requires annual regulatory filings by the
end of May through the year 2001. The PUCT regulatory plan provides
that such savings will be shared equally by shareholders and
ratepayers, except that the shareholders' portion will be reduced by
$2.6 million per year on a total company basis in years four through
eight. The PUCT plan also requires a series of future regulatory
filings in November 1996, 1998, and 2001 to ensure that the ratepayers'
share of such savings be reflected in rates on a timely basis. In
addition, the plan requires Entergy Corporation to hold GSU's Texas
retail customers harmless from the effects of the removal by FERC of a
40% cap on the amount of fuel savings GSU may be required to transfer
to other Operating Companies under the FERC tracking mechanism (see
below). On January 14, 1994, Entergy Corporation filed a petition for
review before the D.C. Circuit seeking review of FERC's deletion of the
40% cap provision in the fuel cost protection mechanism. The matter is
currently being held in abeyance.
FERC approved GSU's inclusion in the System Agreement.
Commitments were adopted to provide reasonable assurance that the
ratepayers of AP&L, LP&L, MP&L, and NOPSI will not be allocated higher
costs including, among other things, (1) a tracking mechanism to
protect AP&L, LP&L, MP&L, and NOPSI from certain unexpected increases
in fuel costs, (2) the distribution of profits from power sales
contracts entered into prior to the Merger, (3) a methodology to
estimate the cost of capital in future FERC proceedings, and (4) a
stipulation that AP&L, LP&L, MP&L, and NOPSI will be insulated from
certain direct effects on capacity equalization payments if GSU were to
acquire Cajun's 30% share in River Bend. The Operating Companies'
regulatory authorities can elect to "opt out" of the fuel tracker, but
are not required to make such an election until FERC has approved the
respective Operating Company's compliance filing. The City and the
MPSC have made such an election.
River Bend (Entergy Corporation and GSU)
- - - - -----------
In May 1988, the PUCT granted GSU a permanent increase in annual
revenues of $59.9 million resulting from the inclusion in rate base of
approximately $1.6 billion of company-wide River Bend plant investment
and approximately $182 million of related Texas retail jurisdiction
deferred River Bend costs (Allowed Deferrals). In addition, the PUCT
disallowed as imprudent $63.5 million of company-wide River Bend plant
costs and placed in abeyance, with no finding of prudence,
approximately $1.4 billion of company-wide River Bend plant investment
and approximately $157 million of Texas retail jurisdiction deferred
River Bend operating and carrying costs. The PUCT affirmed that the
rate treatment of such amounts would be subject to future demonstration
of the prudence of such costs. GSU and intervening parties appealed
this order (Rate Appeal) and GSU filed a separate rate case asking,
among other things, that the abeyed River Bend plant costs be found
prudent (Separate Rate Case). Intervening parties filed suit in a
Texas district court to prohibit the Separate Rate Case and prevailed.
The district court's decision in favor of the intervenors was
ultimately appealed to the Texas Supreme Court, which ruled in 1990
that the prudence of the purported abeyed costs could not be
relitigated in a separate rate proceeding. The Texas Supreme Court's
decision stated that all issues relating to the merits of the original
PUCT order, including the prudence of all River Bend-related costs,
should be addressed in the Rate Appeal.
In October 1991, the Texas district court in the Rate Appeal
issued an order holding that, while it was clear the PUCT made an error
in assuming it could set aside $1.4 billion of the total costs of River
Bend and consider them in a later proceeding, the PUCT, nevertheless,
found that GSU had not met its burden of proof related to the amounts
placed in abeyance. The court also ruled that the Allowed Deferrals
should not be included in rate base. The court further stated that the
PUCT had erred in reducing GSU's deferred costs by $1.50 for each $1.00
of revenue collected under the interim rate increases authorized in
1987 and 1988. The court remanded the case to the PUCT with
instructions as to the proper handling of the Allowed Deferrals. GSU's
motion for rehearing was denied and, in December 1991, GSU filed an
appeal of the October 1991 district court order. The PUCT also
appealed the October 1991 district court order, which served to
supersede the district court's judgment, rendering it unenforceable
under Texas law.
In August 1994, the Texas Third District Court of Appeals (the
Appellate Court) affirmed the district court's decision that there was
substantial evidence to support the PUCT's 1988 decision not to include
the abeyed construction costs in GSU's rate base. While acknowledging
that the PUCT had exceeded its authority in attempting to defer a
decision on the inclusion of those costs in rate base in order to allow
GSU a further opportunity to demonstrate the prudence of those costs in
a subsequent proceeding, the Appellate Court found that GSU had
suffered no harm or lack of due process as a result of the PUCT's
error. Accordingly, the Appellate Court held that the PUCT's action
had the effect of disallowing the company-wide $1.4 billion of River
Bend construction costs for ratemaking purposes. In its August 1994
opinion, the Appellate Court also held that GSU's deferred operating
and maintenance costs associated with the allowed portion of River
Bend, as well as GSU's deferred River Bend carrying costs included in
the Allowed Deferrals, should be included in rate base. The Appellate
Court's August 1994 opinion affirmed the PUCT's original order in this
case.
The Appellate Court's August 1994 opinion was entered by two
judges, with a third judge dissenting. The dissenting opinion stated
that the result of the majority opinion was, among other things, to
deprive GSU of due process at the PUCT because the PUCT never reached a
finding on the $1.4 billion of construction costs.
In October 1994, the Appellate Court denied GSU's motion for
rehearing on the August 1994 opinion as to the $1.4 billion in River
Bend construction costs and other matters. GSU appealed the Appellate
Court's decision to the Texas Supreme Court. On February 9, 1996, the
Texas Supreme Court agreed to hear the appeal. Oral arguments are
scheduled for March 19, 1996.
As of December 31, 1995, the River Bend plant costs disallowed for
retail ratemaking purposes in Texas, the River Bend plant costs held in
abeyance, and the related operating and carrying cost deferrals totaled
(net of taxes) approximately $13 million, $276 million (both net of
depreciation), and $169 million, respectively. Allowed Deferrals were
approximately $83 million, net of taxes and amortization, as of
December 31, 1995. GSU estimates it has collected approximately $182
million of revenues as of December 31, 1995, as a result of the
originally ordered rate treatment by the PUCT of these deferred costs.
If recovery of the Allowed Deferrals is not upheld, future revenues
based upon those allowed deferrals could also be lost, and no assurance
can be given as to whether or not refunds to customers of revenue
received based upon such deferred costs will be required.
No assurance can be given as to the timing or outcome of the
remands or appeals described above. Pending further developments in
these cases, GSU has made no write-offs or reserves for the River Bend-
related costs. See below for a discussion of the write-off of deferred
operating and carrying cost required under SFAS 121 in 1996. Based on
advice from Clark, Thomas & Winters, A Professional Corporation, legal
counsel of record in the Rate Appeal, management believes that it is
reasonably possible that the case will be remanded to the PUCT, and the
PUCT will be allowed to rule on the prudence of the abeyed River Bend
plant costs. At this time, management and legal counsel are unable to
predict the amount, if any, of the abeyed and previously disallowed
River Bend plant costs that ultimately may be disallowed by the PUCT.
A net of tax write-off as of December 31, 1995, of up to $289 million
could be required based on an ultimate adverse ruling by the PUCT on
the abeyed and disallowed costs.
In prior proceedings, the PUCT has held that the original cost of
nuclear power plants will be included in rates to the extent those
costs were prudently incurred. Based upon the PUCT's prior decisions,
management believes that River Bend construction costs were prudently
incurred and that it is reasonably possible that it will recover in
rate base, or otherwise through means such as a deregulated asset plan,
all or substantially all of the abeyed River Bend plant costs.
However, management also recognizes that it is reasonably possible that
not all of the abeyed River Bend plant costs may ultimately be
recovered.
As part of its direct case in the Separate Rate Case, GSU filed a
cost reconciliation study prepared by Sandlin Associates, management
consultants with expertise in the cost analysis of nuclear power
plants, which supports the reasonableness of the River Bend costs held
in abeyance by the PUCT. This reconciliation study determined that
approximately 82% of the River Bend cost increase above the amount
included by the PUCT in rate base was a result of changes in federal
nuclear safety requirements, and provided other support for the
remainder of the abeyed amounts.
There have been four other rate proceedings in Texas involving
nuclear power plants. Disallowed investment in the plants ranged from
0% to 15%. Each case was unique, and the disallowances in each were
made for different reasons. Appeals of two of these PUCT decisions are
currently pending.
The following factors support management's position that a loss
contingency requiring accrual has not occurred, and its belief that
all, or substantially all, of the abeyed plant costs will ultimately be
recovered:
1. The $1.4 billion of abeyed River Bend plant costs have never
been ruled imprudent and disallowed by the PUCT;
2. Analysis by Sandlin Associates, which supports the prudence of
substantially all of the abeyed construction costs;
3. Historical inclusion by the PUCT of prudent construction costs
in rate base; and
4. The analysis of GSU's legal staff, which has considerable
experience in Texas rate case litigation.
Based on advice from Clark, Thomas & Winters, A Professional
Corporation, legal counsel of record in the Rate Appeal, management
believes that it is reasonably possible that the Allowed Deferrals will
continue to be recovered in rates, and that it is reasonably possible
that the deferred costs related to the $1.4 billion of abeyed River
Bend plant costs will be recovered in rates to the extent that the $1.4
billion of abeyed River Bend plant is recovered.
The adoption of SFAS 121 became effective January 1, 1996. SFAS
121 changes the standard for continued recognition of regulatory assets
and, as a result GSU will be required to write-off $169 million of
rate deferrals in 1996. The standard also describes circumstances
that may result in assets being impaired and provides criteria for
recognition and measurement of asset impairment. See Note 1 for
further information regarding SFAS 121.
Filings with the PUCT and Texas Cities (Entergy Corporation and GSU)
- - - - --------------------------------------
In March 1994, the Texas Office of Public Utility Counsel and
certain cities served by GSU instituted an investigation of the
reasonableness of GSU's rates. On March 20, 1995, the PUCT ordered a
$72.9 million annual base rate reduction for the period March 31, 1994,
through September 1, 1994, decreasing to an annual base rate reduction
of $52.9 million after September 1, 1994. In accordance with the
Merger agreement, the rate reduction was applied retroactively to March
31, 1994.
On May 26, 1995, the PUCT amended its previously issued March 20,
1995 rate order, reducing the $52.9 million annual base rate reduction
to an annual level of $36.5 million. The PUCT's action was based, in
part, upon a Texas Supreme Court decision not to require a
utility to use the prospective tax benefits generated by disallowed
expenses to reduce rates. The PUCT's May 26, 1995, amended order no
longer required GSU to pass such prospective tax benefits onto its
customers. The rate refund, retroactive to March 31, 1994, was
approximately $61.8 million (including interest) and was refunded to
customers in September, October, and November 1995. GSU and other
parties have appealed the PUCT order, but no assurance can be given as
to the timing or outcome of the appeal.
Filings with the LPSC
- - - - ---------------------
(Entergy Corporation and GSU)
In May 1994, GSU filed a required earnings analysis with the LPSC
for the test year preceding the Merger (1993). On December 14, 1994,
the LPSC ordered a $12.7 million annual rate reduction for GSU,
effective January 1995. GSU received a preliminary injunction from the
District Court regarding $8.3 million of the reduction relating to the
earnings effect of a 1994 change in accounting for unbilled revenues.
On January 1, 1995, GSU reduced rates by $4.4 million. GSU filed an
appeal of the entire $12.7 million rate reduction with the District
Court, which denied the appeal in July 1995. GSU has appealed the
order to the Louisiana Supreme Court. The preliminary injunction
relating to $8.3 million of the reduction will remain in effect during
the appeal.
On May 31, 1995, GSU filed its second required post-Merger
earnings analysis with the LPSC. Hearings on this review were held and
a decision is expected in mid-1996.
(Entergy Corporation and LP&L)
In August 1994, LP&L filed a performance-based formula rate plan
with the LPSC. The proposed formula rate plan would continue existing
LP&L rates at current levels, while providing a financial incentive to
reduce costs and maintain high levels of customer satisfaction and
system reliability. The plan would allow LP&L the opportunity to earn
a higher rate of return if it improves performance over time.
Conversely, if performance declines, the rate of return LP&L could earn
would be lowered. This would provide a financial incentive for LP&L to
continuously improve in all three performance categories (price,
customer satisfaction, and service reliability).
On June 2, 1995, as a result of the LPSC's earnings review of
LP&L's performance-based formula rate plan, a $49.4 million reduction
in base rates was ordered. This included $10.5 million of rate
reductions previously made through the fuel adjustment clause. The net
effect of the LPSC order was to reduce rates by $38.9 million. The
LPSC approved LP&L's proposed formula rate plan with the following
modifications. An earnings band was established with a range from
10.4% to 12% for return on equity. If LP&L's earnings fall within the
bandwidth, no adjustment in rates occurs. However, if LP&L's earnings
are above or below the established earnings band, prospective rate
decreases or increases will occur. The LPSC also reduced LP&L's
authorized rate of return from 12.76% to 11.2%. The LPSC rate order
was retroactive to April 27, 1995.
On June 9, 1995, LP&L appealed the $49.4 million rate reduction
and filed a petition for injunctive relief from implementation of $14.7
million of the reduction. The $14.7 million portion of the rate
reduction represents revenue imputed to LP&L as a result of the LPSC's
conclusion that LP&L charged unreasonably low rates to three industrial
customers. Subsequently, a request for a $14.7 million rate increase
was filed by LP&L. On July 13, 1995, LP&L was granted a preliminary
injunction by the District Court on $14.7 million of the rate reduction
pending a final LPSC order. Exclusive of the $14.7 million stayed
under the preliminary injunction, the rate refund was retroactive to
April 27, 1995, and amounted to approximately $8.2 million. Customers
received the refunds in the months of September and October 1995.
In an order issued on January 31, 1996, the LPSC approved a
settlement reducing the $14.7 million portion of the rate reduction to
$12.35 million. Rate refunds subject to this settlement were
retroactive to April 27, 1995, and were made in the months of January
and February 1996. The refunds and related interest resulting from the
settlement amounted to $8.9 million. The District Court case discussed
above was dismissed as part of the settlement.
LPSC Fuel Cost Review (Entergy Corporation and GSU)
- - - - ---------------------
In November 1993, the LPSC ordered a review of GSU's fuel costs
for the period October 1988 through September 1991 (Phase 1) based on
the number of outages at River Bend and the findings in the June 1993
PUCT fuel reconciliation case. In July 1994, the LPSC ruled in the
Phase 1 fuel review case and ordered GSU to refund approximately $27
million to its customers. Under the order, a refund of $13.1 million
was made through a billing credit on August 1994 bills. In August
1994, GSU appealed the remaining $13.9 million of the LPSC-ordered
refund to the district court. GSU has made no reserve for the remaining
portion, pending outcome of the district court appeal, and no assurance
can be given as to the timing or outcome of the appeal.
The LPSC is currently conducting the second phase of its review of
GSU's fuel costs for the period October 1991 through December 1994. On
June 30, 1995, the LPSC consultants filed testimony recommending a
disallowance of $38.7 million of fuel costs. Hearings began in
December 1995 and are expected to be completed in early March 1996.
Deregulated Asset Plan (Entergy Corporation and GSU)
- - - - ----------------------
A deregulated asset plan representing an unregulated portion
(approximately 24%) of River Bend (plant costs, generation, revenues,
and expenses) was established pursuant to a January 1992 LPSC order.
The plan allows GSU to sell such generation to Louisiana retail
customers at 4.6 cents per KWh or off-system at higher prices, with
certain sharing provisions for sharing such incremental revenue above
4.6 cents per KWh between ratepayers and shareholders.
River Bend Cost Deferrals (Entergy Corporation and GSU)
- - - - -------------------------
GSU deferred approximately $369 million of River Bend operating
and purchased power costs, and accrued carrying charges, pursuant to a
1986 PUCT accounting order. Approximately $182 million of these costs
are being amortized over a 20-year period, and the remaining $187
million are not being amortized pending the outcome of the Rate Appeal.
As of December 31, 1995, the unamortized balance of these costs was
$312 million. GSU deferred approximately $400.4 million of similar
costs pursuant to a 1986 LPSC accounting order, of which approximately
$83 million were unamortized as of December 31, 1995, and are being
amortized over a 10-year period ending in 1998.
In accordance with a phase-in plan approved by the LPSC, GSU
deferred $294 million of its River Bend costs related to the period
February 1988 through February 1991. GSU has amortized $172 million
through December 31, 1995. The remainder of $122 million will be
recovered over approximately 2.2 years.
Grand Gulf 1 and Waterford 3 Deferrals
- - - - --------------------------------------
(Entergy Corporation and AP&L)
Under the settlement agreement entered into with the APSC in 1985
and amended in 1988, AP&L agreed to retain a portion of its Grand Gulf
1-related costs, recover a portion of such costs currently, and defer a
portion of such costs for future recovery. In 1995 and subsequent
years, AP&L retains 22% of its 36% interest in Grand Gulf 1 costs and
recovers the remaining 78%. The deferrals ceased in l990, and AP&L is
recovering a portion of the previously deferred costs each year through
l998. As of December 31, l995, the balance of deferred costs was $360
million. AP&L is permitted to recover on a current basis the
incremental costs of financing the unrecovered deferrals. In the event
AP&L is not able to sell its retained share to third parties, it may
sell such energy to its retail customers at a price equal to its
avoided energy cost, which is currently less than AP&L's cost of energy
from its retained share.
(Entergy Corporation and LP&L)
In a series of LPSC orders, court decisions, and agreements from
late 1985 to mid-1988, LP&L was granted rate relief with respect to
costs associated with Waterford 3 and LP&L's share of capacity and
energy from Grand Gulf 1, subject to certain terms and conditions.
With respect to Waterford 3, LP&L was granted an increase aggregating
$170.9 million over the period 1985-1988, and agreed to
permanently absorb, and not recover from retail ratepayers, $284
million of its investment in the unit and to defer $266 million of its
costs related to the years 1985-1988 to be recovered over approximately
8.6 years beginning in April 1988. As of December 31, 1995, LP&L's
unrecovered deferral balance was $26 million.
With respect to Grand Gulf 1, in November 1988, LP&L agreed to
retain and not recover from retail ratepayers, 18% of its 14% share
(approximately 2.52%) of the costs of Grand Gulf 1 capacity and energy.
LP&L is allowed to recover through the fuel adjustment clause 4.6 cents
per KWh for the energy related to its retained portion of these costs.
Alternatively, LP&L may sell such energy to nonaffiliated parties at
prices above the fuel adjustment clause recovery amount, subject to the
LPSC's approval.
(Entergy Corporation and MP&L)
MP&L entered into a revised plan with the MPSC that provides,
among other things, for the recovery by MP&L, in equal annual
installments over ten years beginning October 1, 1988, of all Grand
Gulf 1-related costs deferred through September 30, 1988, pursuant to a
final order by the MPSC. Additionally, the plan provides that MP&L
defer, in decreasing amounts, a portion of its Grand Gulf 1-related
costs over four years beginning October 1, 1988. These deferrals are
being recovered by MP&L over a six-year period beginning in October
1992 and ending in September 1998. As of December 31, 1995, the
uncollected balance of MP&L's deferred costs was approximately $378
million. The plan also allows for the current recovery of carrying
charges on all deferred amounts.
(Entergy Corporation and NOPSI)
Under NOPSI's various Rate Settlements with the Council in 1986,
1988, and 1991, NOPSI agreed to absorb and not recover from ratepayers
a total of $96.2 million of its Grand Gulf 1 costs. NOPSI was
permitted to implement annual rate increases in decreasing amounts each
year through 1995, and to defer certain costs and related carrying
charges for recovery on a schedule extending from 1991 through 2001.
As of December 31, 1995, the uncollected balance of NOPSI's deferred
costs was $171 million.
February 1994 Ice Storm/Rate Rider (Entergy Corporation and MP&L)
- - - - ----------------------------------
In early February 1994, an ice storm left more than 80,000 MP&L
customers without electric power across the service area. The storm
was the most severe natural disaster ever to affect the System, causing
damage to transmission and distribution lines, equipment, poles, and
facilities in certain areas, primarily in Mississippi. Repair costs
totaled approximately $77.2 million, with $64.6 million of these
amounts capitalized as plant-related costs. The remaining balances
were recorded as a deferred debit.
Subsequent to a request by MP&L for rate recovery, the MPSC
approved a stipulation in September 1994, with respect to the recovery
of ice storm costs recorded through April 30, 1994. Under the
stipulation, MP&L implemented an ice storm rate rider, which increased
rates approximately $8 million for a period of five years beginning on
September 29, 1994. This stipulation also stated that at the end of
the five-year period, the revenue requirement associated with the
undepreciated ice storm capitalized costs will be included in MP&L's
base rates to the extent that this revenue requirement does not result
in MP&L's rate of return on rate base being above the benchmark rate of
return under MP&L's Formula Rate Plan.
In September 1995, the MPSC approved a second stipulation which
allows for a $2.5 million rate increase for a period of four years
beginning September 28, 1995, to recover costs related to the ice storm
that were recorded after April 30, 1994. The stipulation also allows
for undepreciated ice storm capital costs recorded after April 30, 1994,
to be treated as described above.
1994 NOPSI Settlement (Entergy Corporation and NOPSI)
- - - - ---------------------
In a settlement with the Council that was approved on December 29,
1994, NOPSI agreed to reduce electric and gas rates and issue credits
and refunds to customers. Effective January 1, 1995, NOPSI implemented
a $31.8 million permanent reduction in electric base rates and a $3.1
million permanent reduction in gas base rates. These adjustments
resolved issues associated with NOPSI's return on equity exceeding
13.76% for the test year ended September 30, 1994. Under the 1991
NOPSI Settlement, NOPSI is recovering from its retail customers its
allocable share of certain costs related to Grand Gulf 1. NOPSI's base
rates to recover those costs were derived from estimates of those costs
made at that time. Any overrecovery of costs is required to be
returned to customers. Grand Gulf 1 has experienced lower operating
costs than previously estimated, and NOPSI accordingly is reducing its
base rates in two steps to match more accurately the current costs
related to Grand Gulf 1. On January 1, 1995, NOPSI implemented a $10
million permanent reduction in base electric rates to reflect the
reduced costs related to Grand Gulf 1, which was followed by an
additional $4.4 million rate reduction on October 31, 1995. These
Grand Gulf rate reductions, which are expected to be largely offset by
lower operating costs, may reduce NOPSI's after-tax net income by
approximately $1.4 million per year beginning November 1, 1995. The
Grand Gulf 1 phase-in rate increase in the amount of $4.4 million on
October 31, 1995, was not affected by the 1994 NOPSI Settlement.
The 1994 NOPSI Settlement also required NOPSI to credit its
customers $25 million over a 21-month period beginning January 1, 1995,
in order to resolve disputes with the Council regarding the
interpretation of the 1991 NOPSI Settlement. NOPSI reduced its
revenues by $25 million and recorded a $15.4 million net-of-tax reserve
associated with the credit in the fourth quarter of 1994. The 1994
NOPSI Settlement further required NOPSI to refund, in December 1994,
$13.3 million of credits previously scheduled to be made to customers
during the period January 1995 through July 1995. These credits were
associated with a July 7, 1994, Council resolution that ordered a
$24.95 million rate reduction based on NOPSI's overearnings during the
test year ended September 30, 1993. Accordingly, NOPSI recorded an $8
million net-of-tax charge in the fourth quarter of 1994.
The 1994 NOPSI Settlement also required NOPSI to refund $9.3
million of overcollections associated with Grand Gulf 1 operating
costs, and $10.5 million of refunds associated with the settlement by
System Energy of a FERC tax audit. The settlement of the FERC tax
audit by System Energy required refunds to be passed on to NOPSI and to
other Entergy subsidiaries and then on to customers. These refunds
have no effect on current period net income.
Pursuant to the 1994 NOPSI Settlement, NOPSI is required to make
earnings filings with the Council for the 1995 and 1996 rate years. A
review of NOPSI's earnings for the test year ending September 30, 1995,
will require NOPSI to credit customers $6.2 million over a 12-month
period beginning March 11, 1996. Hearings with the Council as to the
reasonableness and prudence of NOPSI's deferred Least Cost Intergrated
Resource Planning expenses for cost recovery purposes are scheduled for
April 1996.
Proposed Rate Increase
- - - - ----------------------
(System Energy)
System Energy filed an application with FERC on May 12, 1995, for
a $65.5 million rate increase. The request seeks changes to System
Energy's rate schedule, including increases in the revenue requirement
associated with decommissioning costs, the depreciation rate, and the
rate of return on common equity. On December 12, 1995, System Energy
implemented a $65.5 million rate increase, subject to refund. Hearings
on System Energy's request began in January 1996 and were completed in
February 1996. The ALJ's initial decision is expected in 1996.
(MP&L)
MP&L's allocation of the proposed System Energy wholesale rate
increase is $21.6 million. In July 1995, MP&L filed a schedule with
the MPSC that will defer the ultimate amount of the System Energy rate
increase. The deferral plan, which was approved by the MPSC, began in
December 1995, the effective date of the System Energy rate increase,
and will end after the issuance of a final order by FERC. The deferred
rate increase is to be amortized over 48 months beginning October 1998.
(NOPSI)
NOPSI's allocation of the proposed System Energy wholesale rate
increase is $11.1 million. In February 1996, NOPSI filed a plan with
the City to defer 50% of the amount of the System Energy rate increase.
The deferral began with the February 1996 bill to NOPSI from System
Energy and will end after the issuance of a final order by FERC.
FERC Settlement (Entergy Corporation and System Energy)
In November 1994, FERC approved an agreement settling a long-
standing dispute involving income tax allocation procedures of System
Energy. In accordance with the agreement, System Energy refunded
approximately $61.7 million to AP&L, LP&L, MP&L, and NOPSI, each of
which in turn has made refunds or credits to its customers (except
for those portions attributable to AP&L's and LP&L's retained share of
Grand Gulf 1 costs). Additionally, System Energy will refund a total
of approximately $62 million, plus interest, to AP&L, LP&L, MP&L, and
NOPSI over the period through June 2004. The settlement also required
the write-off of certain related unamortized balances of deferred
investment tax credits by AP&L, LP&L, MP&L, and NOPSI. The settlement
reduced Entergy Corporation's consolidated net income for the year
ended December 31, 1994, by approximately $68.2 million, offset by the
write-off of the unamortized balances of related deferred investment
tax credits of approximately $69.4 million ($2.9 million for Entergy
Corporation; $27.3 million for AP&L; $31.5 million for LP&L; $6 million
for MP&L; and $1.7 million for NOPSI). System Energy also reclassified
from utility plant to other deferred debits approximately $81 million
of other Grand Gulf 1 costs. Although such costs are excluded from
rate base, System Energy is recovering them over a 10-year period.
Interest on the $62 million refund and the loss of the return on the
$81 million of other Grand Gulf 1 costs will reduce Entergy's and
System Energy's net income by approximately $10 million annually over
the next 10 years.
FERC Return on Equity Case
- - - - --------------------------
In August 1992, FERC instituted an investigation of the return on
equity (ROE) component of all formula wholesale rates for System Energy
as well as AP&L, LP&L, MP&L, and NOPSI. Rates under the Unit Power
Sales Agreement are based on System Energy's cost of service, including
a return on common equity which had been set at 13%.
In August 1993, Entergy and the state regulatory agencies that
intervened in the proceeding reached an agreement (Settlement
Agreement) in this matter. The Settlement Agreement, which was
approved by FERC on October 25, 1993, provides that an 11.0% ROE will
be included in the formula rates under the Unit Power Sales Agreement.
System Energy's refunds payable to AP&L, LP&L, MP&L, and NOPSI, which
were due prospectively from November 3, 1992, were reflected as a
credit to their bills in October 1993. These refunds decreased System
Energy's 1993 revenues and net income by approximately $29.4 million
and $18.2 million, respectively. The Unit Power Sales Agreement
formula rate, including the 11.0% ROE component, currently remains in
effect. However, in December 1995, System Energy implemented a rate
increase subject to refund, which included an increased return on
common equity. Refer to above for a discussion of the proposed System
Energy rate increase.
NOTE 3. INCOME TAXES
Entergy Corporation
- - - - -------------------
Entergy Corporation's income tax expense consists of the
following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $306,910 $227,046 $236,513
State 60,278 50,300 30,618
---------- ---------- ----------
Total 367,188 277,346 267,131
Deferred -- net 13,333 (54,429) 118,656
Investment tax credit (21,478) (24,739) (43,796)
adjustments--net
Investment tax credit - (66,454) -
amortization - FERC Settlement
---------- ---------- ----------
Recorded income tax expense $359,043 $131,724 $341,991
========== ========== ==========
Charged to operations $349,528 $131,965 $251,163
Charged (credited) to other (13,346) (241) 33,640
income
Charged to cumulative effect 22,861 - 57,188
---------- ---------- ----------
Total income taxes $359,043 $131,724 $341,991
========== ========== ==========
</TABLE>
Entergy Corporation's total income taxes differ from the amounts
computed by applying the statutory Federal income tax rate to income
before taxes. The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------- ------- -------- ------- ------- -------
(Dollars in Thousands)
Computed at statutory rate $334,944 35.0 $194,448 35.0 $332,555 35.0
Increases (reductions) in tax
resulting from:
Amortization of excess (5,516) (0.5) (5,845) (1.1) (7,063) (0.7)
deferred income taxes
State income taxes net of
federal income
tax effect 42,599 4.5 13,766 2.5 30,160 3.2
Amortization of investment (20,549) (2.1) (27,337) (4.9) (25,911) (2.7)
tax credits
Amortization of investment
tax credits -
FERC Settlement - - (66,454) (12.0) - -
Depreciation 1,670 0.1 9,995 1.8 5,925 0.6
SFAS 109 adjustment - - - - 9,547 1.0
Other--net 5,895 0.5 13,151 2.4 (3,222) (0.4)
-------- ------- -------- ------- -------- -------
Total income taxes $359,043 37.5 $131,724 23.7 $341,991 36.0
======== ======= ======== ======= ======== =======
</TABLE>
Significant components of Entergy Corporation's net deferred tax
liabilities as of December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory assets/(liabilities) $(1,494,000) $(1,645,119)
Plant related basis differences (3,071,519) (3,092,889)
Rate deferrals (467,691) (617,699)
Other (117,510) (181,743)
-------------- --------------
Total $(5,150,720) $(5,537,450)
============== ==============
Deferred Tax Assets:
- - - - --------------------
Sale and leaseback 225,620 247,842
Accumulated deferred investment tax credit 214,505 227,473
NOL carryforwards 151,141 251,000
Investment tax credit carryforwards 167,713 255,394
Valuation allowance (44,597) (64,407)
Other 585,847 664,697
-------------- --------------
Total $1,300,229 $1,581,999
============== ==============
Net deferred tax liability $(3,850,491) $(3,955,451)
============== ==============
</TABLE>
Arkansas Power & Light Company
- - - - ------------------------------
AP&L's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $87,937 $64,238 $47,326
State 18,027 19,062 10,836
--------- --------- ---------
Total 105,964 83,300 58,162
Deferred -- net (5,363) (17,939) 34,748
Investment tax credit adjustments- (5,658) (8,814) (10,573)
- - - - -net
Investment tax credit amortization - (27,327) -
- FERC Settlement
--------- --------- ---------
Recorded income tax expense $94,943 $29,220 $82,337
========= ========= =========
Charged to operations $53,936 $9,938 $18,746
Charged (credited) to other income 18,146 19,282 32,451
Charged to cumulative effect 22,861 - 31,140
--------- --------- ---------
Total income taxes $94,943 $29,220 $82,337
========= ========= =========
</TABLE>
AP&L's total income taxes differ from the amounts computed by
applying the statutory Federal income tax rate to income before taxes.
The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
-------- -------- ------ ------- ------ -------
(Dollars in Thousands)
Computed at statutory rate $93,458 35.0 $60,017 35.0 $100,673 35.0
Increases (reductions) in tax
resulting from:
State income taxes net of
federal income
tax effect 11,551 4.3 7,821 4.6 12,119 4.2
Amortization of investment (5,658) (2.1) (10,220) (6.0) (11,702) (4.1)
tax credits
Investment tax credit
amortization -
FERC settlement - - (27,327) (15.9) - -
Depreciation (1,510) (0.6) (921) (0.5) (3,156) (1.1)
Reversal of prior year - - - - (3,771) (1.3)
contingency
Flow-through/permanent (3,259) (1.2) (208) (0.1) (7,669) (2.7)
differences
Other--net 361 0.1 58 - (4,157) (1.4)
-------- ------ ------- ------- ------- -----
Total income taxes $94,943 35.5 $29,220 17.1 $82,337 28.6
======== ====== ======= ======= ======= =====
</TABLE>
Significant components of AP&L's net deferred tax liabilities as of
December 31, 1995 and 1994,are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory $(264,166) $(273,574)
assets/(liabilities)
Plant related basis (480,465) (465,787)
differences
Rate deferrals (131,261) (183,700)
Bond reacquisition costs (23,022) (22,496)
Decontamination and (15,942) (17,104)
decommissioning fund
Other (30,511) (20,317)
------------- -------------
Total $(945,367) $(982,978)
============= =============
Deferred Tax Assets:
- - - - --------------------
Accumulated deferred 44,260 46,506
investment tax credit
Provision-FASB 5 contingencies 7,250 9,214
Alternative minimum tax credit - 3,536
Other 21,394 39,121
------------- -------------
Total $72,904 $98,377
============= =============
Net deferred tax liability $(872,463) $(884,601)
============= =============
</TABLE>
Gulf States Utilities Company
- - - - -----------------------------
GSU's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $13 $71 $16,714
State - 14 -
--------- --------- ---------
Total 13 85 16,714
Deferred -- net 67,703 (57,911) 46,477
Investment tax credit (4,472) (4,260) 1,093
adjustments--net
--------- --------- ---------
Recorded income tax $63,244 $(62,086) $64,284
expense
========= ========= =========
Charged to operations $57,235 $(6,448) $46,007
Charged (credited) to other 6,009 (55,638) 12,009
income
Charged to extraordinary - - (671)
items
Charged to cumulative - - 6,939
effect
--------- --------- ---------
Total income taxes $63,244 $(62,086) $64,284
========= ========= =========
</TABLE>
GSU's total income taxes differ from the amounts computed by
applying the statutory Federal income tax rate to income before taxes.
The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------- -------- ------- -------- ------- ------
(Dollars in Thousands)
Computed at statutory rate $65,157 35.0 ($50,694) (35.0) $50,101 35.0
Increases (reductions) in tax
resulting from:
State income taxes net of
federal income
tax effect 8,375 4.5 (6,571) (4.5) 1,332 0.9
Rate deferrals - net 6,240 3.4 6,551 4.5 6,193 4.3
Depreciation (13,073) (7.0) (8,188) (5.7) (11,343) (7.9)
Impact of change in tax - - - - 5,179 3.6
rate
Book expenses not deducted - - 151 0.1 15,134 10.6
for tax
Amortization of investment (4,475) (2.4) (4,472) (3.1) (4,435) (3.1)
tax credits
Other--net 1,020 0.5 1,137 0.8 2,123 1.5
------- ------- -------- ------ -------- -----
Total income taxes $63,244 34.0 ($62,086) (42.9) $64,284 44.9
======= ======= ======== ====== ======== =====
</TABLE>
Significant components of GSU's net deferred tax liabilities as of
December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory $(512,281) $(494,443)
assets/(liabilities)
Plant related basis differences (1,060,241) (1,065,053)
Rate deferrals (104,695) (132,213)
Other (1,814) (23,163)
---------------- ----------------
Total $(1,679,031) $(1,714,872)
================ ================
Deferred Tax Assets:
- - - - --------------------
Net operating loss carryforwards $151,141 $251,000
Investment tax credit 167,713 173,852
carryforward
Valuation allowance - investment (44,597) (64,407)
tax credit carryforward
Accumulated deferred investment 58,653 69,269
tax credit
Alternative minimum tax credit 39,709 39,743
Other 172,733 194,476
---------------- ----------------
Total $545,352 $663,933
================ ================
Net deferred tax liability $(1,133,679) $(1,050,939)
================ ================
</TABLE>
Louisiana Power & Light Company
- - - - -------------------------------
LP&L's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $93,670 $68,891 $62,037
State 20,994 10,369 8,514
-------- -------- -------
Total 114,664 79,260 70,551
Deferred -- net 8,148 21,580 43,017
Investment tax credit adjustments- (5,698) (6,048) (2,755)
- - - - -net
Investment tax credit amortization - (31,504) -
- FERC settlement
-------- -------- -------
Recorded income tax expense $117,114 $63,288 $110,813
======== ======== =======
Charged to operations $116,486 $63,751 $108,568
Charged (credited) to other income 628 (463) 2,245
--------- -------- --------
Total income taxes $117,114 $63,288 $110,813
========= ======== ========
</TABLE>
LP&L's total income taxes differ from the amounts computed by
applying the statutory Federal income tax rate to income before taxes.
The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------ ------ ------- ------ ------ ------
(Dollars in Thousands)
Computed at statutory rate $111,528 35.0 $96,994 35.0 $104,867 35.0
Increases (reductions) in tax
resulting from:
State income taxes net of
federal income
tax effect 11,532 3.6 5,147 1.9 6,727 2.2
Depreciation 2,693 0.8 3,219 1.2 2,550 0.9
Impact of change in tax (2,626) (0.8) (2,749) (1.0) (2,767) (0.9)
rate
Amortization of investment (5,711) (1.8) (6,305) (2.3) (6,876) (2.3)
tax credits
Amortization of investment
tax credits -
FERC settlement - - (31,504) (11.3) - -
SFAS 109 adjustment - - - - 4,193 1.4
Other--net (302) (0.1) (1,514) (0.6) 2,119 0.7
--------- ------- --------- -------- --------- -----
Total income taxes $117,114 36.7 $63,288 22.9 $110,813 37.0
========= ======= ========= ======== ========= =====
</TABLE>
Significant components of LP&L's net deferred tax liabilities as
of December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- -----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory $(357,528) $(437,468)
assets/(liabilities)
Plant related basis (722,680) (722,653)
differences
Rate deferrals (12,652) (26,695)
Other (35,272) (32,972)
-------------- --------------
Total $(1,128,132) $(1,219,788)
============== ==============
Deferred Tax Assets:
- - - - --------------------
Unbilled revenues $16,850 $11,108
Accumulated deferred 56,008 58,205
investment tax credit
Removal cost 59,148 52,576
Alternative minimum tax 27,409 56,222
credit
Waterford 3 sale and 105,788 102,111
leaseback
Other 52,285 59,323
-------------- --------------
Total $317,488 $339,545
============== ==============
Net deferred tax liability $(810,644) $(880,243)
============== ==============
</TABLE>
Mississippi Power & Light Company
- - - - ---------------------------------
MP&L's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $62,436 $39,505 $46,744
State 9,215 7,379 7,673
----------- ---------- ----------
Total 71,651 46,884 54,417
Deferred -- net (35,224) (26,763) 539
Investment tax credit adjustments- (1,550) (1,673) 1,036
- - - - -net
Investment tax credit amortization - (5,973) -
- FERC Settlement
----------- ---------- ----------
Recorded income tax expense $34,877 $12,475 $55,992
=========== ========== ==========
Charged to operations $33,716 $16,651 $33,074
Charged (credited) to other income 1,161 (4,176) 3,462
Charged to cumulative effect - - 19,456
----------- ---------- ----------
Total income taxes $34,877 $12,475 $55,992
=========== ========== ==========
</TABLE>
MP&L's total income taxes differ from the amounts computed by
applying the statutory federal income tax rate to income before taxes.
The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
-------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------- ------- ------- ------- ------- -------
(Dollars in Thousands)
Computed at statutory rate $36,240 35.0 $21,438 35.0 $55,207 35.0
Increases (reductions) in tax
resulting from:
State income taxes net of
federal income
tax effect 3,344 3.2 2,465 4.0 3,253 2.1
Depreciation 739 0.7 1,930 3.2 (5,890) (3.7)
Amortization of excess DIT (3,465) (3.3) (3,810) (6.2) (4,680) (3.0)
Amortization of investment (1,548) (1.5) (1,674) (2.7) (1,772) (1.1)
tax credits
Amortization of investment
tax credits -
FERC Settlement - - (5,973) (9.8) - -
Adjustments of prior year (246) (0.2) (1,954) (3.2) 5,228 3.3
taxes
FASB 109 Adjustment - - 3,439 2.2
Other--net (187) (0.2) 53 0.1 1,207 0.8
--------- --------- --------- ------ ------- ------
Total income taxes $34,877 33.7 $12,475 20.4 $55,992 35.6
========= ========= ========= ====== ======= ======
</TABLE>
Significant components of MP&L's net deferred tax liabilities as
of December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory $(17,147) $1,804
assets/(liabilities)
Plant related basis differences (181,792) (173,965)
Rate deferrals (157,168) (201,037)
Other (9,339) (13,318)
------------- -------------
Total $(365,446) $(386,516)
============= =============
Deferred Tax Assets:
Accumulated deferred investment $10,702 $11,295
tax credit
Removal cost 2,316 2,824
Pension related items 2,342 3,182
Other 17,415 20,412
------------- -------------
Total $32,775 $37,713
============= =============
Net deferred tax liability $(332,671) $(348,803)
============= =============
</TABLE>
New Orleans Public Service Inc.
- - - - -------------------------------
NOPSI's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $19,071 $19,557 $23,400
State 3,394 3,049 4,079
---------- ---------- ----------
Total 22,465 22,606 27,479
Deferred -- net (1,364) (15,674) 5,203
Investment tax credit adjustments- (634) (681) (743)
- - - - -net
Investment tax credit adjustments- - (1,651) -
-FERC Settlement
---------- ---------- ----------
Recorded income tax expense $20,467 $4,600 $31,939
========== ========== ==========
Charged to operations $19,836 $3,602 $24,232
Charged (credited) to other income 631 998 1,115
Charged to cumulative effect - - 6,592
Total income taxes $20,467 $4,600 $31,939
</TABLE>
NOPSI's total income taxes differ from the amounts computed by
applying the statutory Federal income tax rate to income before taxes.
The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------- -------- ------ ------- ------ -------
(Dollars in Thousands)
Computed at statutory rate $19,198 35.0 $6,234 35.0 $27,877 35.0
Increases (reductions) in tax
resulting from:
State income taxes net of
federal income
tax effect 1,971 3.6 456 2.6 3,411 4.3
Depreciation (661) (1.2) (586) (3.3) (780) (1.0)
Amortization of investment (634) (1.2) (681) (3.8) (745) (0.9)
tax credits
Investment tax credit
amortization-
FERC settlement - - (1,651) (9.2)
Amortization of excess 575 1.1 714 4.0 384 0.5
deferred income tax
Adjustments of prior year 101 0.2 (423) (2.4) 2,413 3.0
taxes
FASB 109 adjustment - - - - (1,170) (1.5)
Other--net (83) (0.2) 537 3.0 549 0.7
-------- -------- -------- -------- -------- --------
Total income taxes $20,467 37.3 $4,600 25.9 $31,939 40.1
======== ======== ======== ======== ======== ========
</TABLE>
Significant components of NOPSI's net deferred tax liabilities as
of December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
(In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory $(10,723) $(12,946)
assets/(liabilities)
Plant related basis (50,820) (50,624)
Rate deferrals - net (61,915) (74,054)
Other (3,134) (3,303)
-------------- -------------
Total $(126,592) $(140,927)
============== =============
Deferred Tax Assets:
- - - - --------------------
Unbilled revenues $3,689 $3,051
Accumulated deferred investment 3,910 4,154
tax credit
Pension related items 4,189 4,497
Removal costs 10,019 9,146
Operating reserves 6,795 6,665
Rate refund 459 9,620
Other 6,703 9,623
-------------- -------------
Total $35,764 $46,756
============== =============
Net deferred tax liability $(90,828) $(94,171)
============== =============
</TABLE>
System Energy Resources, Inc.
- - - - -----------------------------
System Energy's income tax expense consists of the following:
<TABLE>
<CAPTION>
For the Years Ended December 31,
--------------------------------
1995 1994 1993
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
Current:
Federal $108,920 $54,295 $59,050
State 11,910 13,182 3,671
---------- ---------- --------
Total 120,830 67,477 62,721
Deferred -- net (41,871) (27,375) 46,284
Investment tax credit (3,466) (3,265) (30,452)
adjustments--net
---------- ---------- --------
Recorded income tax expense $75,493 $36,837 $78,553
========== ========== ========
Charged to operations $77,410 $38,087 $83,412
Charged (credited) to other (1,917) (1,250) (4,859)
income
---------- ---------- --------
Total income taxes $75,493 $36,837 $78,553
========== ========== ========
</TABLE>
System Energy's total income taxes differ from the amounts
computed by applying the statutory Federal income tax rate to income
before taxes. The reasons for the differences are:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1995 1994 1993
---- ---- ----
% of % of % of
Pre-tax Pre-tax Pre-tax
Amount Income Amount Income Amount Income
------- ------- ------- ------ ------- -------
(Dollars in Thousands)
Computed at statutory rate $58,986 35.0 $14,785 35.0 $60,368 35.0
Increases (reductions) in tax
resulting from:
Depreciation 13,482 8.0 14,541 34.4 12,839 7.4
State income taxes net of
federal income
tax effect 7,036 4.2 7,565 17.9 6,778 3.9
Amortization of investment (3,480) (2.1) (3,476) (8.2) (3,759) (2.2)
tax credits
Adjustments of prior year 2 - 2,947 7.0 5,292 3.0
taxes
Other--net (533) (0.3) 475 1.1 (2,965) (1.6)
-------- -------- -------- ------- -------- -------
Total income taxes $75,493 44.8 $36,837 87.2 $78,553 45.5
======= ======== ======= ====== ======== ======
</TABLE>
Significant components of System Energy's net deferred tax
liabilities as of December 31, 1995 and 1994, are as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
In Thousands)
<S> <C> <C>
Deferred Tax Liabilities:
- - - - -------------------------
Net regulatory assets/liabilities) $(332,154) $(431,562)
Plant related basis differences (538,215) (577,286)
Other (10,365) (11,280)
-------------- -------------
Total $(880,734) $(1,020,128)
============== =============
Deferred Tax Assets:
- - - - --------------------
Sale and leaseback $119,832 $145,731
FERC Settlement 19,519 23,098
Accumulated deferred investment 40,973 42,298
tax credit
Alternative minimum tax credit 63,642 38,179
Other 34,586 24,320
-------------- -------------
Total $278,552 $273,626
============== =============
Net deferred tax liability $(602,182) $(746,502)
============== =============
</TABLE>
As of December 31, 1995, Entergy had investment tax credit (ITC)
carryforwards of $167.7 million, federal net operating loss (NOL)
carryforwards of $384.6 million and state NOL carryforwards of $355.0
million, all related to GSU operations. The ITC carryforwards include the
35% reduction required by the Tax Reform Act of 1986 and may be applied
against federal income tax liability of only GSU and, if not utilized,
will expire between 1996 and 2002. It is currently anticipated that
approximately $44.6 million of ITC carryforward will expire unutilized.
A valuation allowance has been provided for deferred tax assets
relating to that amount. The alternative minimum tax (AMT) credit
carryforwards as of December 31, 1995, were $130.7 million, including
$39.7 million at GSU, $27.4 million at LP&L, and $63.6 million at SERI.
This AMT credit can be carried forward indefinitely and will reduce the
System's federal income tax liability in the future.
In accordance with the System Energy-FERC Settlement, the System
wrote off $66.5 million of unamortized deferred investment tax credits
in 1994, including $27.3 million at AP&L, $31.5 million at LP&L, $6.0
million at MP&L, and $1.7 million at NOPSI.
In 1993, the System adopted SFAS 109. SFAS 109 required that
deferred income taxes be recorded for all carryforwards and temporary
differences between the book and tax basis of assets and liabilities,
and that deferred tax balances be based on enacted tax laws at tax
rates that are expected to be in effect when the temporary differences
reverse. SFAS 109 required that regulated enterprises recognize
adjustments resulting from implementation as regulatory assets or
liabilities if it is probable that such amounts will be recovered from
or returned to customers in future rates. A substantial majority of
the adjustments required by SFAS 109 was recorded to deferred tax
balance sheet accounts with offsetting adjustments to regulatory assets
and liabilities. As a result of the adoption of SFAS 109, Entergy's
1993 net income and earnings per share were decreased by $13.2 million
and $0.08 per share, respectively, and assets and liabilities were
increased by $822.7 million and $835.9 million, respectively. The
cumulative effect of the adoption of SFAS 109 is included in income tax
expense charged to operations. The following table shows the effect of
the adoption of SFAS 109 on 1993 net income, assets and liabilities for
AP&L, LP&L, MP&L, NOPSI, and SERI.
<TABLE>
<CAPTION>
Increase
(Decrease) Increase Increase
in Net Income in in
Assets Liabilities
------------ --------- --------------
(In Millions)
<S> <C> <C> <C>
AP&L ($2.6) $168.2 $170.8
LP&L (5.7) 309.7 315.4
MP&L (1.7) 50.2 51.9
NOPSI 0.3 4.1 3.8
System Energy 0.4 327.9 327.5
</TABLE>
GSU recorded the adoption of SFAS 109 by restating 1990, 1991, and
1992 financial statements and including a charge of $96.5 million for
the cumulative effect of the adoption of SFAS 109 in 1990 primarily for
that portion of the operations on which GSU has discontinued regulatory
accounting principles.
In August 1994, Entergy received an IRS report covering the
federal income tax audit of Entergy Corporation and subsidiaries for
the years 1988 - 1990. The report asserts an $80 million tax
deficiency for the 1990 consolidated federal income tax returns related
primarily to the application of accelerated investment tax credits
associated with Waterford 3 and Grand Gulf nuclear plants. Entergy
believes there is no material tax deficiency and is vigorously
contesting the proposed assessment.
NOTE 4. LINES OF CREDIT AND RELATED BORROWINGS (Entergy Corporation,
AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy)
The SEC has authorized AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy to effect short-term borrowings up to $125 million, $125
million, $150 million, $100 million, $39 million, and $125 million,
respectively (for a total of $664 million). These limits may be
increased to as much as $1.216 billion in total (subject to individual
authorizations for each company) after further SEC approval. These
authorizations are effective through November 30, 1996. Of these
companies, only LP&L and System Energy had borrowings outstanding as of
December 31, 1995. LP&L had $76.5 million of borrowings outstanding,
including $61.5 million under the money pool, an intra-System borrowing
arrangement designed to reduce the System's dependence on external
short-term borrowings. LP&L had unused bank lines of credit in the
amount of $2.7 million. System Energy had money pool borrowings
outstanding of approximately $3 million at December 31, 1995. AP&L and
MP&L had undrawn lines of credit as of December 31, 1995, of $34 million
and $30 million, respectively.
On July 27, 1995, Entergy Corporation received SEC authorization
for a $300 million bank credit facility. Thereafter, a three-year
credit agreement was signed with a group of banks on October 10, 1995,
to provide up to $300 million of loans to Entergy Corporation. As of
December 31, 1995, no amounts were outstanding against this credit
facility. However, on January 4, 1996, $230 million was borrowed
against the facility for use in the acquisition of CitiPower. See Note
15 for a discussion of the acquisition.
Other Entergy companies have financing agreements and facilities
permitting them to borrow up to $135 million, of which $30 million was
outstanding as of December 31, 1995. Some of these borrowings are
restricted as to use, and are secured by certain assets.
In total, the System had commitments in the amount of $516.7
million at December 31, 1995, of which $471.7 million was unused. The
weighted average interest rate on the outstanding borrowings at
December 31, 1995, and December 31, 1994, was 6.35% and 7.18%,
respectively. Commitment fees on the lines of credit for AP&L, LP&L,
and MP&L are 0.125% of the undrawn amounts. The commitment fee for
Entergy Corporation's $300 million credit facility is currently 0.17%,
but can fluctuate depending on the senior debt ratings of the Operating
Companies.
NOTE 5. PREFERRED, PREFERENCE, AND COMMON STOCK (Entergy Corporation,
AP&L, GSU, LP&L, MP&L, and NOPSI)
The number of shares, authorized and outstanding, and dollar value
of preferred and preference stock for Entergy, AP&L, GSU, LP&L, MP&L,
and NOPSI as of December 31, 1995, and 1994 were:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Shares Call Price Per
Authorized Total Share as of
and Dollar December 31,
Outstanding Value
--------- --------- --------- --------- ---------------
1995 1994 1995 1994 1995
--------- --------- --------- --------- ---------------
(Dollars in Thousands)
AP&L Preferred Stock
- - - - --------------------
Without sinking fund:
Cumulative, $100 par value:
4.32% Series 70,000 70,000 $7,000 $7,000 $103.647
4.72% Series 93,500 93,500 9,350 9,350 $107.000
4.56% Series 75,000 75,000 7,500 7,500 $102.830
4.56% 1995 Series 75,000 75,000 7,500 7,500 $102.500
6.08% Series 100,000 100,000 10,000 10,000 $102.830
7.32% Series 100,000 100,000 10,000 10,000 $103.170
7.08% Series 150,000 150,000 15,000 15,000 $103.250
7.40% Series 200,000 200,000 20,000 20,000 $102.800
7.88% Series 150,000 150,000 15,000 15,000 $103.000
Cumulative, $25 par value:
8.84% Series 400,000 400,000 10,000 10,000 $26.560
Cumulative, $0.01 par value:
$2.40 Series (a)(b) 2,000,000 2,000,000 50,000 50,000 -
$1.96 Series (a)(b) 600,000 600,000 15,000 15,000 -
--------- --------- --------- ---------
Total without sinking fund 4,013,500 4,013,500 $176,350 $176,350
========= ========= ========= =========
With sinking fund:
Cumulative, $100 par value:
8.52% Series 350,000 375,000 $35,000 $37,500 $106.390
Cumulative, $25 par value:
9.92% Series 561,085 641,085 14,027 16,027 $26.320
13.28% Series - 200,000 - 5,000 -
--------- --------- --------- ---------
Total with sinking fund: 911,085 1,216,085 $49,027 $58,527
========= ========= ========= =========
Fair Value of Preferred Stock with
sinking fund(d) $51,476 $60,600
========= =========
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Shares Call Price Per
Authorized Total Share as of
and Dollar December 31,
Outstanding Value
--------- --------- --------- --------- ---------------
1995 1994 1995 1994 1995
--------- --------- --------- --------- ---------------
(Dollars in Thousands)
GSU Preferred and Preference Stock
- - - - ----------------------------------
Preference Stock
Cumulative, without par value
7% Series (a)(b) 6,000,000 6,000,000 $150,000 $150,000 -
========= ========= ========= =========
Preferred Stock
Authorized 6,000,000, $100 par
value, cumulative
Without sinking fund:
4.40% Series 51,173 51,173 $5,117 $5,117 $108.00
4.50% Series 5,830 5,830 583 583 $105.00
4.40%-1949 Series 1,655 1,655 166 166 $103.00
4.20% Series 9,745 9,745 975 975 $102.82
4.44% Series 14,804 14,804 1,480 1,480 $103.75
5.00% Series 10,993 10,993 1,099 1,099 $104.25
5.08% Series 26,845 26,845 2,685 2,685 $104.63
4.52% Series 10,564 10,564 1,056 1,056 $103.57
6.08% Series 32,829 32,829 3,283 3,283 $103.34
7.56% Series 350,000 350,000 35,000 35,000 $101.80
8.52% Series 500,000 500,000 50,000 50,000 $102.43
9.96% Series 350,000 350,000 35,000 35,000 $102.64
--------- --------- --------- ---------
Total without 1,364,438 1,364,438 $136,444 $136,444
sinking fund ========= ========= ========= =========
With sinking fund:
8.80% Series 204,495 226,807 $20,450 $22,680 $100.00
9.75% Series 19,543 21,565 1,954 2,154 $100.00
8.64% Series 168,000 182,000 16,800 18,200 $101.00
Adjustable Rate-A,7.00%(c) 192,000 204,000 19,200 20,400 $100.00
Adjustable Rate-B,7.00%(c) 292,500 315,000 29,250 31,500 $100.00
--------- --------- --------- ---------
Total with 876,538 949,372 $87,654 $94,934
sinking fund: ========= ========= ========= =========
Fair Value of Preference Stock and
Preferred Stock with sinking fund(d) $219,191 $227,800
========= =========
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Shares Call Price Per
Authorized Total Share as of
and Dollar December 31,
Outstanding Value
--------- --------- --------- --------- ---------------
1995 1994 1995 1994 1995
--------- --------- --------- --------- ---------------
(Dollars in Thousands)
LP&L Preferred Stock
Without sinking fund:
Cumulative, $100 par value:
4.96% Series 60,000 60,000 $6,000 $6,000 $104.25
4.16% Series 70,000 70,000 7,000 7,000 $104.21
4.44% Series 70,000 70,000 7,000 7,000 $104.06
5.16% Series 75,000 75,000 7,500 7,500 $104.18
5.40% Series 80,000 80,000 8,000 8,000 $103.00
6.44% Series 80,000 80,000 8,000 8,000 $102.92
7.84% Series 100,000 100,000 10,000 10,000 $103.78
7.36% Series 100,000 100,000 10,000 10,000 $103.36
8.56% Series 100,000 100,000 10,000 10,000 $103.14
Cumulative, $25 par value:
8.00% Series (b) 1,480,000 1,480,000 37,000 37,000 -
9.68% Series (b) 2,000,000 2,000,000 50,000 50,000 -
--------- --------- --------- ---------
Total without sinking fund 4,215,000 4,215,000 $160,500 $160,500
========= ========= ========= =========
With sinking fund:
Cumulative, $100 par value:
7.00% Series (b) 500,000 500,000 $50,000 $50,000 -
8.00% Series(b) 350,000 350,000 35,000 35,000 -
Cumulative, $25 par value:
10.72% Series - 150,211 - 3,756 -
12.64% Series 600,370 900,370 15,009 22,509 $26.58
--------- --------- --------- ---------
Total with sinking fund 1,450,370 1,900,581 $100,009 $111,265
========= ========= ========= =========
Fair Value of Preferred Stock with
sinking fund(d) $103,135 $113,000
========= =========
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Shares Call Price Per
Authorized Total Share as of
and Dollar December 31,
Outstanding Value
--------- --------- --------- --------- ---------------
1995 1994 1995 1994 1995
--------- --------- --------- --------- ---------------
(Dollars in Thousands)
MP&L Preferred Stock
- - - - --------------------
Without sinking fund:
Cumulative, $100 par value:
4.36% Series 59,920 59,920 $5,992 $5,992 $103.86
4.56% Series 43,888 43,888 4,389 4,389 $107.00
4.92% Series 100,000 100,000 10,000 10,000 $102.88
7.44% Series 100,000 100,000 10,000 10,000 $102.81
8.36% Series(b) 200,000 200,000 20,000 20,000 -
9.16% Series 75,000 75,000 7,500 7,500 $104.06
--------- --------- --------- ---------
Total without sinking fund 578,808 578,808 $57,881 $57,881
========= ========= ========= =========
With sinking fund:
Cumulative, $100 par value:
9.00% Series 0 70,000 $ - $7,000 -
9.76% Series 140,000 210,000 14,000 21,000 $101.09
12.00% Series 27,700 37,700 2,770 3,770 $106.00
--------- --------- --------- ---------
Total with sinking fund 167,700 317,700 $16,770 $31,770
========= ========= ========= =========
Fair Value of Preferred Stock with
sinking fund(d) $16,936 $32,500
========= =========
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Shares Call Price Per
Authorized Total Share as of
and Dollar Value December 31,
Outstanding
----------- ----------- ----------- ----------- ---------------
1995 1994 1995 1994 1995
----------- ----------- ----------- ----------- ---------------
(Dollars in Thousands)
NOPSI Preferred Stock
- - - - ---------------------
Without sinking fund:
Cumulative, $100 par value:
4 3/4% Preferred Stock 77,798 77,798 $7,780 $7,780 $105.00
4.36% Series 60,000 60,000 6,000 6,000 $104.58
5.56% Series 60,000 60,000 6,000 6,000 $102.59
----------- ----------- ----------- -----------
Total without sinking fund 197,798 197,798 $19,780 $19,780
=========== =========== =========== ===========
With sinking fund:
Cumulative, $100 par value:
15.44% Series - 34,495 $ - $3,450 -
=========== =========== =========== ===========
Fair Value of Preferred Stock with sinking fund(d) $ - $3,600
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
Entergy
- - - - -------
<S> <C> <C> <C> <C>
Subsidiaries'
Preference Stock (a)(b): 6,000,000 6,000,000 $150,000 $150,000
=========== =========== =========== ===========
Subsidiaries' Preferred Stock:
Without sinking fund 10,369,544 10,369,544 $550,955 $550,955
=========== =========== =========== ===========
With sinking fund 3,405,693 4,418,233 $253,460 $299,946
=========== =========== =========== ===========
Fair Value of Preference Stock and $390,738 $437,500
Preferred Stock with sinking fund(d) =========== ===========
</TABLE>
(a) The total dollar value represents the involuntary liquidation
value of $25 per share.
(b) These series are not redeemable as of December 31, 1995.
(c) Rates are as of December 31, 1995.
(d) Fair values were determined using bid prices reported by dealer
markets and by nationally recognized investment banking firms.
See Note 1 for additional disclosure of fair value of financial
instruments.
Changes in the preferred stock, with and without sinking fund,
preference stock, and common stock of AP&L, GSU, LP&L, MP&L, and NOPSI
during the last three years were:
<TABLE>
<CAPTION>
Number of Shares
------------------------------------
1995 1994 1993
--------- ----------- ------------
<S> <C> <C> <C>
Preferred stock retirements
AP&L
$100 par value (25,000) (45,000) (85,000)
$25 par value (280,000) (280,000) (280,000)
GSU
$100 par value (72,834) (60,667) (1,683,834)
LP&L
$25 par value (450,211) (601,537) (900,000)
MP&L
$100 par value (150,000) (150,000) (165,000)
NOPSI
$100 par value (34,495) (15,000) (15,000)
Preference stock issuances, GSU - - 6,000,000
Common stock issuances, GSU - - 100
Common stock retirements, GSU - - (114,055,065)
</TABLE>
Cash sinking fund requirements for the next five years for
preferred stock, outstanding as of December 31, 1995 are:
<TABLE>
<CAPTION>
Entergy AP&L (a) GSU (a) LP&L (a) MP&L (a)
---------- ---------- ---------- ---------- ----------
( In Thousands)
<S> <C> <C> <C> <C> <C>
1996 $21,817 $4,500 $6,067 $3,750 $7,500
1997 21,817 4,500 6,067 3,750 7,500
1998 14,817 4,500 6,067 3,750 500
1999 64,826 4,500 6,067 53,759 500
2000 161,067 4,500 156,067 - 500
</TABLE>
(a) AP&L, GSU, LP&L, and MP&L have the annual noncumulative option to
redeem, at par, additional amounts of certain series of their
outstanding preferred stock.
On December 31, 1993, Entergy Corporation issued 56,695,724 shares
of common stock in connection with the Merger. In addition, Entergy
Corporation redeemed 174,552,011 shares of $5 par value common stock
and reissued 174,552,011 shares of $0.01 par value common stock
resulting in an increase in paid-in capital of $871 million.
Entergy Corporation had a program in which it repurchased and
retired (returned to authorized but unissued status) 1,230,000 shares
of common stock at a cost of $30.7 million in 1994. In addition,
627,000 shares of treasury stock were purchased for cash during 1993 at
a cost of $20.6 million. A portion of the treasury shares purchased in
1993 was subsequently reissued, and in connection with the Merger on
December 31, 1993, the remaining balance of 579,274 shares of treasury
stock was canceled.
Entergy Corporation from time to time acquires shares of its
common stock to be held as treasury shares and to be reissued to meet
the requirements of the Stock Plan for Outside Directors (Directors'
Plan), the Equity Ownership Plan of Entergy Corporation and
Subsidiaries (Equity Plan), and certain other stock benefit plans.
Under this program, 2,805,000 of treasury shares were purchased in 1994
at a cost of $88.8 million. The Directors' Plan awards nonemployee
directors a portion of their compensation in the form of a fixed number
of shares of Entergy Corporation common stock. Shares awarded under
the Directors' Plan were 9,251, 18,757, and 12,550 during 1995, 1994,
and 1993, respectively. The Equity Plan grants stock options,
restricted shares, and equity awards to key employees of the System
companies. The costs of awards are charged to income over the period
of the grant or restricted period, as appropriate. Amounts charged to
compensation expense in 1995 were immaterial. Stock options, which
comprise 50% of the shares targeted for distribution under the Equity
Plan, are granted at exercise prices not less than market value on the
date of grant. The options are generally exercisable no less than six
months nor more than 10 years after the date of grant.
Nonstatutory stock option transactions are summarized as follows:
<TABLE>
<CAPTION>
Option Number of
Price Options
---------- ----------
<S> <C> <C>
Options outstanding as of January 1, 1993 - 45,000
Options granted during 1993 $34.750 70,000
$39.750 6,107
Options exercised during 1993 $29.625 (13,198)
$34.750 (5,000)
Options granted during 1994 $37.000 67,500
Options exercised during 1994 - -
Options granted during 1995 $23.375 65,000
$20.875 (a) 250,000
Options exercised during 1995 $23.375 (7,500)
$24.125 (5,000)
Options expired unused during 1995 - (15,000)
----------
Options remaining as of December 31, 1995 457,909
==========
</TABLE>
(a) Options were not exercisable as of December 31, 1995.
The Employee Stock Investment Plan (ESIP) is authorized to issue
or acquire, through March 31, 1997, up to 2,000,000 shares of its
common stock to be held as treasury shares and reissued to meet
the requirements of the ESIP. Under the ESIP, employees may be
granted the opportunity to purchase (for up to 10% of their
regular annual salary, but not more than $25,000) common stock at
85% of the market value on the first or last business day of the
plan year, whichever is lower. Through this program, employees
purchased 329,863 shares for the 1994 plan year. The 1995 plan
year runs from April 1, 1995, to March 31, 1996.
<PAGE>
NOTE 6. LONG - TERM DEBT (Entergy Corporation, AP&L, GSU, LP&L,
MP&L, NOPSI, and System Energy)
The long-term debt of Entergy Corporation's subsidiaries, AP&L,
GSU, LP&L, MP&L, NOPSI, and System Energy, as of December 31, 1995,
was:
<TABLE>
<CAPTION>
Maturities Interest Rates System
From To From To Entery AP&L GSU LP&L MP&L NOPSI Energy
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First Mortgage Bonds
1996 1999 5% 10.5% $1,064,410 $75,160 $445,000 $104,000 $35,000 $35,250 $370,000
2000 2004 6% 9.75% 1,282,320 180,800 670,000 361,520 70,000
2005 2009 6.25% 11.375% 355,319 215,000 120,000 20,319
2010 2014 11.375% 50,000 50,000
2015 2019 9.75% 11.375% 95,000 75,000 20,000
2020 2024 7% 10.375% 1,008,818 373,818 450,000 185,000
G&R Bonds
1996 1999 6.95% 11.2% 152,000 122,000 30,000
2000 2023 6.625% 8.8% 485,000 355,000 130,000
Governmental Obligations (b)
1996 2008 5.9% 10% 110,868 51,495 46,300 12,158 915
2009 2023 5.95% 12.50% 1,551,235 240,700 435,735 412,170 46,030 416,600
Debentures
1996 2008 9.72% 150,000 150,000
2000 7.38% 30,000 30,000
Long-Term DOE Obligations 111,536 111,536
(Note 8)
Waterford 3 Lease Obligation 353,600 353,600
8.76% (Note 9)
Grand Gulf Lease Obligation 500,000 500,000
7.02% (Note 9)
Line of Credit, variable 65,000
rate, due 1998
Other Long-Term Debt 9,156 9,156
Unamortized Premium and (38,488) (13,606) (5,295) (8,017) (3,526) (1,042) (7,002)
Discount - Net ---------- ---------- ---------- ---------- -------- -------- ----------
Total Long-Term Debt 7,335,774 1,309,903 2,320,896 1,420,431 555,419 194,208 1,469,917
Less Amount Due Within One 558,650 28,700 145,425 35,260 61,015 38,250 250,000
Year ---------- ---------- ---------- ---------- -------- -------- ----------
Long-Term Debt Excluding
Amount Due Within One
Year $6,777,124 $1,281,203 $2,175,471 $1,385,171 $494,404 $155,958 $1,219,917
========== ========== ========== ========== ======== ======== ==========
Fair Value of Long-Term $6,666,420 $1,213,511 $2,416,932 $1,136,246 $594,365 $198,785 $1,041,581
Debt (c) ========== ========== ========== ========== ======== ======== ==========
</TABLE>
The long-term debt of Entergy Corporation's subsidiaries, AP&L,
GSU, LP&L, MP&L, NOPSI, and System Energy, as of December 31, 1994,
was:
<TABLE>
<CAPTION>
Maturities Interest Rates System
From To From To Entery AP&L GSU LP&L MP&L NOPSI Energy
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
First Mortgage Bonds
1995 1999 4.625% 14% $1,290,210 $100,960 $445,000 $179,000 $55,000 $35,250 $475,000
2000 2004 6% 9.75% 1,282,320 180,800 670,000 361,520 70,000
2005 2009 6.25% 11.375% 355,319 215,000 120,000 20,319
2010 2014 11.375% 50,000 50,000
2015 2019 9.75% 11.375% 95,000 75,000 20,000
2020 2024 7% 10.375% 1,008,818 373,818 450,000 185,000
G&R Bonds
1995 1999 5.95% 14.95%(a) 221,200 167,000 54,200
2000 2023 6.625% 8.65% 375,000 275,000 100,000
Governmental Obligations (b)
1995 2008 5.9% 10% 114,622 53,120 46,725 12,472 1,880
2009 2023 5.95% 12.50% 1,527,768 234,004 435,735 395,400 46,030 416,600
Debentures - Due 1998, 9.72% 200,000 200,000
Long-Term DOE Obligations 105,163 105,163
(Note 8)
Waterford 3 Lease Obligation 353,600 353,600
8.76% (Note 9)
Grand Gulf Lease Obligation 500,000 500,000
7.02% (Note 9)
Other Long-Term Debt 6,879 6,879
Unamortized Premium and (43,341) (15,811) (5,497) (8,617) (3,712) (1,090) (8,614)
Discount - Net ---------- ---------- ---------- ---------- -------- -------- ----------
Total Long-Term Debt 7,442,558 1,322,054 2,368,842 1,478,375 541,198 188,360 1,543,305
Less Amount Due Within One 349,085 28,175 50,425 75,320 65,965 24,200 105,000
Year ---------- ---------- ---------- ---------- -------- -------- ----------
Long-Term Debt Excluding
Amount Due Within One
Year $7,093,473 $1,293,879 $2,318,417 $1,403,055 $475,233 $164,160 $1,438,305
========== ========== ========== ========== ======== ======== ==========
Fair Value of Long-Term $6,293,000 $1,133,600 $2,277,300 $1,089,200 $523,100 $178,700 $1,091,000
Debt (c) ========== ========== ========== ========== ======== ======== ==========
</TABLE>
(a) $20 million of MP&L's 14.95% Series G&R Bonds and $9.2 million of
NOPSI's 13.9% Series G&R Bonds were due 2/1/95. All other series
are at interest rates within the range of 6.95% - 11.2%.
(b) Consists of pollution control bonds, certain series of which are
secured by non-interest bearing first mortgage bonds.
(c) The fair value excludes lease obligations, long-term DOE
obligations, and other long-term debt and was determined using bid
prices reported by dealer markets and by nationally recognized
investment banking firms. See Note 1 for additional information
on disclosure of fair value of financial instruments.
The annual long-term debt maturities (excluding lease obligations)
and annual cash sinking fund requirements for the next five years
follow:
System
Entergy (a) AP&L (b) GSU (c) LP&L (d) MP&L (e) NOPSI Energy
(Dollars In Thousands)
1996 558,650 28,700 145,425 35,260 61,015 38,250 250,000
1997 361,270 33,065 160,865 34,325 96,015 27,000 10,000
1998 314,920 18,710 190,890 35,300 20 - 70,000
1999 172,391 1,225 100,915 231 20 - 70,000
2000 143,015 1,825 945 100,225 20 - 40,000
(a) Not included are other sinking fund requirements of approximately
$20.4 million annually which may be satisfied by cash or by
certification of property additions at the rate of 167% of such
requirements.
(b) Not included are other sinking fund requirements of approximately
$1.1 million annually which may be satisfied by cash or by
certification of property additions at the rate of 167% of such
requirements.
(c) Not included are other sinking fund requirements of approximately
$13.8 million annually which may be satisfied by cash or by
certification of property additions at the rate of 167% of such
requirements.
(d) Not included are other sinking fund requirements of approximately
$5.5 million annually which may be satisfied by cash or by
certification of property additions at the rate of 167% of such
requirements.
(e) Not included are other sinking fund requirements of approximately
$0.1 million for 1996 which may be satisfied by cash or by
certification of property additions at the rate of 167% of such
requirements.
GSU has two outstanding series of pollution control bonds
collateralized by irrevocable letters of credit, which are scheduled to
expire before the scheduled maturity of the bonds. The letter of
credit collateralizing the $28.4 million variable rate series, due
December 1, 2015, expires in September 1996 and the letter of credit
collateralizing the $20 million variable rate series, due April 1,
2016, expires in April 1996. GSU plans to refinance these series or
renew the letters of credit.
Under MP&L's G&R Mortgage, G&R Bonds are issuable based upon 70%
of bondable property additions, based upon 50% of accumulated deferred
Grand Gulf 1 related costs, based upon the retirement of certain bonds
previously outstanding, or based upon the deposit of cash with the
trustee. MP&L's G&R Mortgage prohibits the issuance of additional
first mortgage bonds (including for refunding purposes) under MP&L's
first mortgage indenture, except such first mortgage bonds as may
hereafter be issued from time to time at MP&L's option to the corporate
trustee under the G&R Mortgage to provide additional security for
MP&L's G&R Bonds.
Under NOPSI's G&R Mortgage, G&R Bonds are issuable based upon 70%
of bondable property additions or based upon 50% of accumulated
deferred Grand Gulf 1-related costs. The G&R Mortgage precludes the
issuance of any additional bonds based upon property additions if the
total amount of outstanding Rate Recovery Mortgage Bonds issued on the
basis of the uncollected balance of deferred Grand Gulf 1-related costs
exceeds 66 2/3% of the balance of such deferred costs. As of December
31, 1995, the total amount of Rate Recovery Mortgage Bonds outstanding
aggregated $30.0 million, or 17.3% of NOPSI's accumulated deferred
Grand Gulf 1-related costs.
NOTE 7. DIVIDEND RESTRICTIONS - (Entergy Corporation, AP&L, GSU,
LP&L, MP&L, NOPSI, and System Energy)
Provisions within the Articles of Incorporation or pertinent
Indentures and various other agreements related to the long-term debt
and preferred stock of Entergy Corporation's subsidiaries restrict the
payment of cash dividends or other distributions on their common and
preferred stock. Additionally, PUHCA prohibits Entergy Corporation's
subsidiaries from making loans or advances to Entergy Corporation.
Detailed below are the restricted common equity and restricted retained
earnings unavailable for distribution to Entergy Corporation by
subsidiary.
Restricted Restricted
Company Equity Earnings
(In Millions)
AP&L $ 882.6 $ 291.3
GSU 1,266.5 -
LP&L 1,084.1 -
MP&L 334.8 135.7
NOPSI 85.2 15.2
System Energy 808.1 18.7
----------- ----------
Entergy $ 4,461.3 $ 460.9
=========== ==========
NOTE 8. COMMITMENTS AND CONTINGENCIES
Cajun - River Bend Litigation (Entergy Corporation and GSU)
GSU has significant business relationships with Cajun, including
co-ownership of River Bend (operated by GSU) and Big Cajun 2, Unit 3
(operated by Cajun). GSU and Cajun, respectively, own 70% and 30%
undivided interests in River Bend and 42% and 58% undivided interests
in Big Cajun 2, Unit 3.
In June 1989, Cajun filed a civil action against GSU in the United
States District Court for the Middle District of Louisiana (District
Court). Cajun's complaint seeks to annul, rescind, terminate, and/or
dissolve the Joint Ownership Participation and Operating Agreement
(Operating Agreement) entered into on August 28, 1979, relating to
River Bend. Cajun alleges fraud and error by GSU, breach of its
fiduciary duties owed to Cajun, and/or GSU's repudiation, renunciation,
abandonment, or dissolution of its core obligations under the Operating
Agreement, as well as the lack or failure of cause and/or consideration
for Cajun's performance under the Operating Agreement. The suit also
seeks to recover Cajun's alleged $1.6 billion investment in the unit as
damages, plus attorneys' fees, interest, and costs. Two member
cooperatives of Cajun have brought an independent action to declare the
Operating Agreement void, based upon failure to get prior LPSC approval
alleged to be necessary. GSU believes the suits are without merit and
is contesting them vigorously.
A trial on the portion of the suit by Cajun to rescind the
Operating Agreement began in April 1994 and was completed in March
1995. On October 24, 1995, the District Court issued a memorandum
opinion ruling in favor of GSU. The District Court found that Cajun
did not prove that GSU fraudulently induced it to execute the Operating
Agreement and that Cajun failed to timely assert its claim. A final
judgment on this portion of the suit will not be entered until all
claims asserted by Cajun have been heard. The second portion of the
suit is scheduled to begin on July 2, 1996. If GSU is ultimately
unsuccessful in this litigation and is required to pay substantial
damages, GSU would probably be unable to make such payments and could
be forced to seek relief from its creditors under the United States
Bankruptcy Code. If GSU prevails in this litigation, there can be no
assurance that the United States Bankruptcy Court will allow funding of
all required costs of Cajun's ownership in River Bend.
Cajun has not paid its full share of capital costs, operating and
maintenance expenses, or other costs for repairs and improvements to
River Bend since 1992. In addition, certain costs and expenses paid by
Cajun were paid under protest. These actions were taken by Cajun based
on its contention, with which GSU disagrees, that River Bend's
operating and maintenance expenses were excessive. Cajun's unpaid
portion of River Bend operating and maintenance expenses (including
nuclear fuel) and capital costs for 1995 was approximately $58.7
million. Cajun continues to pay its share of decommissioning costs for
River Bend.
During the period in which Cajun is not paying its share of River
Bend costs, GSU intends to fund all costs necessary for the safe,
continuing operation of the unit. The responsibilities of Entergy
Operations as the licensed operator of River Bend, for safely operating
and maintaining the unit, are not affected by Cajun's actions.
In view of Cajun's failure to fund its share of River Bend-related
operating, maintenance, and capital costs, GSU has (i) credited GSU's
share of expenses for Big Cajun 2, Unit 3 against amounts due from
Cajun to GSU, and (ii) sought to market Cajun's share of the power from
River Bend and apply the proceeds to the amounts due from Cajun to GSU.
As a result, on November 2, 1994, Cajun discontinued supplying GSU with
its share of power from Big Cajun 2, Unit 3. GSU requested an order
from the District Court requiring Cajun to supply GSU with this energy
and allowing GSU to credit amounts due to Cajun for Big Cajun 2, Unit 3
energy against amounts Cajun owed to GSU for River Bend. In December
1994, by means of a preliminary injunction, the District Court ordered
Cajun to supply GSU with its share of energy from Big Cajun 2, Unit 3
and ordered GSU to make payments for its share of Big Cajun 2, Unit 3
expenses to the registry of the District Court. In October 1995, the
Fifth Circuit affirmed the District Court's preliminary injunction. As
of December 31, 1995, $38 million had been paid by GSU into the
registry of the District Court.
On December 21, 1994, Cajun filed a petition in the United States
Bankruptcy Court for the Middle District of Louisiana seeking
bankruptcy relief under Chapter 11 of the Bankruptcy Code. Cajun's
bankruptcy could have a material adverse effect on GSU. However, GSU
is taking appropriate steps to protect its interests and its claims
against Cajun arising from the co-ownership in River Bend and Big Cajun
2, Unit 3. On December 31, 1994, the District Court issued an order
lifting an automatic stay as to certain proceedings, with the result
that the preliminary injunction granted by the Court in December 1994
remains in effect. Cajun filed a Notice of Appeal on January 18, 1995,
to the Fifth Circuit seeking a reversal of the District Court's grant
of the preliminary injunction. No hearing date has been set on Cajun's
appeal.
In the bankruptcy proceedings, Cajun filed on January 10, 1995, a
motion to reject the Operating Agreement as a burdensome executory
contract. GSU responded on January 10, 1995, with a memorandum
opposing Cajun's motion. Should the court grant Cajun's motion to
reject the Operating Agreement, Cajun would be relieved of its
financial obligations under the contract, while GSU would likely have a
substantial damage claim arising from any such rejection. Although GSU
believes that Cajun's motion to reject the Operating Agreement is
without merit, it is not possible to predict the outcome or ultimate
impact of these proceedings.
The cumulative cost (excluding nuclear fuel) to GSU resulting from
Cajun's failure to pay its full share of River Bend-related costs,
reduced by the proceeds from the sale by GSU of Cajun's share of River
Bend power and payments for GSU's portion of expenses for Big Cajun 2,
Unit 3 into the registry of the District Court, was $31.1 million as of
December 31, 1995. These amounts are reflected in long-term
receivables with an offsetting reserve in other deferred credits.
Cajun's bankruptcy may affect the ultimate collectibility of the
amounts owed to GSU, including any amounts that may be awarded in
litigation.
Cajun - Transmission Service (Entergy Corporation and GSU)
GSU and Cajun are parties to FERC proceedings relating to
transmission service charge disputes. In April 1992, FERC issued a
final order in these disputes. In May 1992, GSU and Cajun filed
motions for rehearings on certain portions of the order, which are still
pending at FERC. In June 1992, GSU filed a petition for review in the
United States Court of Appeals regarding certain of the other issues
decided by FERC. In August 1993, the United States Court of Appeals
rendered an opinion reversing FERC's order regarding the portion of
such disputes relating to the calculations of certain credits and
equalization charges under GSU's service schedules with Cajun. The
opinion remanded the issues to FERC for further proceedings consistent
with its opinion. In February 1995, FERC eliminated an issue from the
remand that GSU believes the Court of Appeals directed FERC to
reconsider. In orders issued on August 3, 1995, and October 2, 1995,
FERC affirmed an April 1995 ruling by an ALJ in the remanded portion of
GSU's and Cajun's ongoing transmission service charge disputes before
FERC. Both GSU and Cajun have petitioned for appeal. No hearing dates
have been set in the appeals.
Under GSU's interpretation of the 1992 FERC order, as modified by
its August 3, 1995, and October 2, 1995, orders, Cajun would owe GSU
approximately $64.9 million as of December 31, 1995. GSU further
estimates that if it were to prevail in its May 1992 motion for
rehearing and on certain other issues decided adversely to GSU in the
February 1995, August 1995, and October 1995 FERC orders, which GSU has
appealed, Cajun would owe GSU approximately $143.5 million, as of
December 31, 1995. If Cajun were to prevail in its May 1992 motion for
rehearing to FERC, and if GSU were not to prevail in its May 1992
motion for rehearing to FERC, and if Cajun were to prevail in appealing
FERC's August and October 1995 orders, GSU estimates it would owe Cajun
approximately $96.4 million as of December 31, 1995. The above amounts
are exclusive of a $7.3 million payment by Cajun on December 31, 1990,
which the parties agreed to apply to the disputed transmission service
charges. Pending FERC's ruling on the May 1992 motions for rehearing,
GSU has continued to bill Cajun, utilizing the historical billing
methodology, and has recorded underpaid transmission charges, including
interest, in the amount of $137.2 million as of December 31, 1995.
This amount is reflected in long-term receivables, with an offsetting
reserve in other deferred credits. Cajun's bankruptcy may affect GSU's
collection of the above amounts. FERC has determined that the
collection of the pre-petition debt of Cajun is an issue properly
decided in the bankruptcy proceeding.
Capital Requirements and Financing (Entergy Corporation, AP&L, GSU,
LP&L, MP&L, NOPSI, and System Energy)
Construction expenditures (excluding nuclear fuel) for the years
1996, 1997, and 1998 are estimated to total $571 million, $510 million,
and $507 million, respectively. The System will also require
$1.3 billion during the period 1996-1998 to meet long-term debt and
preferred stock maturities and cash sinking fund requirements. The
System plans to meet the above requirements primarily with internally
generated funds and cash on hand, supplemented by the issuance of debt
and preferred stock and the use of its outstanding credit facility.
Certain System companies may also continue with the acquisition or
refinancing of all or a portion of certain outstanding series of
preferred stock and long-term debt. See Notes 5 and 6 for further
information.
Grand Gulf 1-Related Agreements
Capital Funds Agreement (Entergy Corporation and System Energy)
Entergy Corporation has agreed to supply System Energy with
sufficient capital to (1) maintain System Energy's equity capital at an
amount equal to a minimum of 35% of its total capitalization (excluding
short-term debt), and (2) permit the continued commercial operation of
Grand Gulf 1 and pay in full all indebtedness for borrowed money of
System Energy when due under any circumstances. In addition, under
supplements to the Capital Funds Agreement assigning System Energy's
rights as security for specific debt of System Energy, Entergy
Corporation has agreed to make cash capital contributions to enable
System Energy to make payments on such debt when due.
System Energy has entered into various agreements with AP&L, LP&L,
MP&L, and NOPSI whereby they are obligated to purchase their respective
entitlements of capacity and energy from System Energy's 90% ownership
and leasehold interest in Grand Gulf 1, and to make payments that,
together with other available funds, are adequate to cover System
Energy's operating expenses. System Energy would have to secure
funds from other sources, including Entergy Corporation's obligations
under the Capital Funds Agreement, to cover any shortfalls from
payments received from AP&L, LP&L, MP&L, and NOPSI under these agreements.
Unit Power Sales Agreement (AP&L, LP&L, MP&L, NOPSI, and System Energy)
System Energy has agreed to sell all of its 90% owned and leased
share of capacity and energy from Grand Gulf 1 to AP&L, LP&L, MP&L, and
NOPSI in accordance with specified percentages (AP&L-36%, LP&L-14%,
MP&L-33% and NOPSI-17%) as ordered by FERC. Charges under this
agreement are paid in consideration for the purchasing companies'
respective entitlement to receive capacity and energy and are payable
irrespective of the quantity of energy delivered so long as the unit
remains in commercial operation. The agreement will remain in effect
until terminated by the parties and approved by FERC, most likely upon
Grand Gulf 1's retirement from service. Monthly obligations for
payments, including the rate increase which was placed into effect in
December 1995, subject to refund, under the agreement are approximately
$21 million, $8 million, $19 million, and $10 million for AP&L, LP&L,
MP&L, and NOPSI, respectively.
Availability Agreement (AP&L, LP&L, MP&L, NOPSI, and System Energy)
AP&L, LP&L, MP&L, and NOPSI are individually obligated to make
payments or subordinated advances to System Energy in accordance with
stated percentages (AP&L-17.1%, LP&L-26.9%, MP&L-31.3%, and NOPSI-
24.7%) in amounts that when added to amounts received under the Unit
Power Sales Agreement or otherwise, are adequate to cover all of System
Energy's operating expenses as defined, including an amount sufficient
to amortize Grand Gulf 2 over 27 years. (See Reallocation Agreement
terms below.) System Energy has assigned its rights to payments and
advances to certain creditors as security for certain obligations.
Since commercial operation of Grand Gulf 1, payments under the Unit
Power Sales Agreement have exceeded the amounts payable under the
Availability Agreement. Accordingly, no payments have ever been
required. If AP&L or MP&L fails to make its Unit Power Sales Agreement
payments, and System Energy is unable to obtain funds from other
sources, LP&L and NOPSI could become subject to claims or demands by
System Energy or its creditors for payments or advances under the
Availability Agreement (or the assignments thereof) equal to the
difference between their required Unit Power Sales Agreement payments
and their required Availability Agreement payments.
Reallocation Agreement (AP&L, LP&L, MP&L, NOPSI, and System Energy)
System Energy and AP&L, LP&L, MP&L, and NOPSI entered into the
Reallocation Agreement relating to the sale of capacity and energy from
the Grand Gulf and the related costs, in which LP&L, MP&L, and NOPSI
agreed to assume all of AP&L's responsibilities and obligations with
respect to the Grand Gulf under the Availability Agreement. FERC's
decision allocating a portion of Grand Gulf 1 capacity and energy to
AP&L supersedes the Reallocation Agreement as it relates to Grand Gulf
1. Responsibility for any Grand Gulf 2 amortization amounts has been
individually allocated (LP&L-26.23%, MP&L-43.97%, and NOPSI-29.80%)
under the terms of the Reallocation Agreement. However, the
Reallocation Agreement does not affect AP&L's obligation to System
Energy's lenders under the assignments referred to in the preceding
paragraph. AP&L would be liable for its share of such amounts if LP&L,
MP&L, and NOPSI were unable to meet their contractual obligations. No
payments of any amortization amounts will be required as long as
amounts paid to System Energy under the Unit Power Sales Agreement,
including other funds available to System Energy, exceed amounts
required under the Availability Agreement, which is expected to be the
case for the foreseeable future.
Reimbursement Agreement (System Energy)
In December 1988, System Energy entered into two entirely
separate, but identical, arrangements for the sales and leasebacks of
an approximate aggregate 11.5% ownership interest in Grand Gulf 1 (see
Note 9). In connection with the equity funding of the sale and
leaseback arrangements, letters of credit are required to be maintained
to secure certain amounts payable for the benefit of the equity
investors by System Energy under the leases. The current letters of
credit are effective until January 15, 1997.
Under the provisions of a bank letter of credit reimbursement
agreement, System Energy has agreed to a number of covenants relating
to the maintenance of certain capitalization and fixed charge coverage
ratios. System Energy agreed, during the term of the reimbursement
agreement, to maintain its equity at not less than 33% of its adjusted
capitalization (defined in the reimbursement agreement to include
certain amounts not included in capitalization for financial statement
purposes). In addition, System Energy must maintain, with respect to
each fiscal quarter during the term of the reimbursement agreement, a
ratio of adjusted net income to interest expense (calculated, in each
case, as specified in the reimbursement agreement) of at least 1.60
times earnings. As of December 31, 1995, System Energy's equity
approximated 34.8% of its adjusted capitalization, and its fixed charge
coverage ratio was 2.11.
Fuel Purchase Agreements
(AP&L and MP&L)
AP&L has long-term contracts with mines in the State of Wyoming
for the supply of low-sulfur coal for the White Bluff Steam Electric
Generating Station and Independence (which is 25% owned by MP&L).
These contracts, which expire in 2002 and 2011, provide for
approximately 85% of AP&L's expected annual coal requirements.
Additional requirements are satisfied by annual spot market purchases.
(GSU)
GSU has a contract for a supply of low-sulfur Wyoming coal for
Nelson Unit 6, which should be sufficient to satisfy the fuel
requirements at Nelson Unit 6 through 2004. Cajun has advised GSU that
it has contracts that should provide an adequate supply of coal until
1999 for the operation of Big Cajun 2, Unit 3.
GSU has long-term gas contracts, which will satisfy approximately
75% of its annual requirements. Such contracts generally require GSU
to purchase in the range of 40% of expected total gas needs.
Additional gas requirements are satisfied under less expensive short-
term contracts. GSU has a transportation service agreement with a gas
supplier that provides flexible natural gas service to the Sabine and
Lewis Creek generating stations. This service is provided by the
supplier's pipeline and salt dome gas storage facility, which has a
present capacity of 5.3 billion cubic feet of natural gas.
(LP&L)
In June 1992, LP&L agreed to a renegotiated 20-year natural gas
supply contract. LP&L agreed to purchase natural gas in annual amounts
equal to approximately one-third of its projected annual fuel
requirements for certain generating units. Annual demand charges
associated with this contract are estimated to be $8.6 million through
1997, and a total of $116.6 million for the years 1998 through 2012.
LP&L recovers the cost of fuel consumed during the generation of
electricity through its fuel adjustment clause.
Power Purchases/Sales Agreements
(GSU)
In 1988, GSU entered into a joint venture with a primary term of
20 years with Conoco, Inc., Citgo Petroleum Corporation, and Vista
Chemical Company (Industrial Participants) whereby GSU's Nelson Units 1
and 2 were sold to a partnership (NISCO) consisting of the Industrial
Participants and GSU. The Industrial Participants supply the fuel for
the units, while GSU operates the units at the discretion of the
Industrial Participants and purchases the electricity produced by the
units. GSU is continuing to sell electricity to the Industrial
Participants. For the years ended December 31, 1995, 1994, and 1993,
the purchases by GSU of electricity from the joint venture totaled
$59.7 million, $58.3 million, and $62.6 million, respectively.
(LP&L)
LP&L has a long-term agreement through the year 2031 to purchase
energy generated by a hydroelectric facility. During 1995, 1994, and
1993, LP&L made payments under the contract of approximately
$55.7 million, $56.3 million, and $66.9 million, respectively. If the
maximum percentage (94%) of the energy is made available to LP&L,
current production projections would require estimated payments of
approximately $47 million in 1996, $54 million in 1997, and a total of
$3.5 billion for the years 1998 through 2031. LP&L recovers the costs
of purchased energy through its fuel adjustment clause.
System Fuels (AP&L, LP&L, MP&L, NOPSI, and System Energy)
AP&L, LP&L, MP&L, and NOPSI have interests in System Fuels of 35%,
33%, 19%, and 13%, respectively. The parent companies of System Fuels
agreed to make loans to System Fuels to finance its fuel procurement,
delivery, and storage activities. As of December 31, 1995, AP&L, LP&L,
MP&L, and NOPSI had, respectively, approximately $11 million, $14.2
million, $5.5 million, and $3.3 million in loans outstanding to System
Fuels which mature in 2008.
In addition, System Fuels entered into a revolving credit
agreement with a bank that provides $45 million in borrowings to
finance System Fuels' nuclear materials and services inventory. Should
System Fuels default on its obligations under its credit agreement,
AP&L, LP&L, and System Energy have agreed to purchase nuclear materials
and services financed under the agreement.
Nuclear Insurance (Entergy Corporation, AP&L, GSU, LP&L, MP&L, NOPSI,
and System Energy)
The Price-Anderson Act limits public liability for a single
nuclear incident to approximately $8.92 billion. The System has
protection for this liability through a combination of private
insurance (currently $200 million each for AP&L, GSU, LP&L, and System
Energy) and an industry assessment program. Under the assessment
program, the maximum payment requirement for each nuclear incident
would be $79.3 million per reactor, payable at a rate of $10 million
per licensed reactor per incident per year. The System has five
licensed reactors. As a co-licensee of Grand Gulf 1 with System
Energy, SMEPA would share 10% of this obligation. With respect to River
Bend, any assessments pertaining to this program are allocated in
accordance with the respective ownership interests of GSU and Cajun. In
addition, the System participates in a private insurance program which
provides coverage for worker tort claims filed for bodily injury caused
by radiation exposure. The program provides for a maximum assessment
of approximately $16 million for the System's five nuclear units in the
event losses exceed accumulated reserve funds.
AP&L, GSU, LP&L, and System Energy are also members of certain
insurance programs that provide coverage for property damage, including
decontamination and premature decommissioning expense, to members'
nuclear generating plants. As of December 31, 1995, AP&L, GSU, LP&L,
and System Energy each was insured against such losses up to $2.75
billion. In addition, AP&L, GSU, LP&L, MP&L, and NOPSI are members of
an insurance program that covers certain replacement power and business
interruption costs incurred due to prolonged nuclear unit outages.
Under the property damage and replacement power/business interruption
insurance programs, these System companies could be subject to
assessments if losses exceed the accumulated funds available to the
insurers. As of December 31, 1995, the maximum amounts of such
possible assessments were: AP&L - $36.3 million; GSU - $22.0 million;
LP&L - $33.2 million; MP&L - $0.8 million; NOPSI - $0.5 million; and
System Energy - $29.0 million. Under its agreement with System Energy,
SMEPA would share in System Energy's obligation. Cajun shares
approximately $4.6 million of GSU's obligation.
The amount of property insurance presently carried by the System
exceeds the NRC's minimum requirement for nuclear power plant licensees
of $1.06 billion per site. NRC regulations provide that the proceeds
of this insurance must be used, first, to place and maintain the
reactor in a safe and stable condition and, second, to complete
decontamination operations. Only after proceeds are dedicated for such
use and regulatory approval is secured would any remaining proceeds be
made available for the benefit of plant owners or their creditors.
Spent Nuclear Fuel and Decommissioning Costs (Entergy Corporation,
AP&L, GSU, LP&L, and System Energy)
AP&L, GSU, LP&L, and System Energy provide for estimated future
disposal costs for spent nuclear fuel in accordance with the Nuclear
Waste Policy Act of 1982. The affected System companies entered into
contracts with the DOE, whereby the DOE will furnish disposal service
at a cost of one mill per net KWh generated and sold after April 7,
1983, plus a onetime fee for generation prior to that date. AP&L, the
only System company that generated electricity with nuclear fuel prior
to that date, elected to pay the onetime fee plus accrued interest, no
earlier than 1998, and has recorded a liability as of December 31,
1995, of approximately $111 million for generation subsequent to 1983.
The fees payable to the DOE may be adjusted in the future to assure
full recovery. The System considers all costs incurred or to be
incurred, except accrued interest, for the disposal of spent nuclear
fuel to be proper components of nuclear fuel expense, and provisions to
recover such costs have been or will be made in applications to
regulatory authorities.
Delays have occurred in the DOE's program for the acceptance and
disposal of spent nuclear fuel at a permanent repository. In a
statement released February 17, 1993, the DOE asserted that it does not
have a legal obligation to accept spent nuclear fuel without an
operational repository for which it has not yet arranged. Currently,
the DOE projects it will begin to accept spent fuel no earlier than
2015. In the meantime, all System companies are responsible for spent
fuel storage. Current on-site spent fuel storage capacity at River
Bend, Waterford 3, and Grand Gulf 1 is estimated to be sufficient until
2003, 2000, and 2004, respectively. Thereafter, the affected companies
will provide additional storage. Current on-site spent fuel storage
capacity at ANO is estimated to be sufficient until mid-1998, at which
time an ANO storage facility using dry casks will begin operation.
This facility is estimated to provide sufficient storage until 2000,
with the capability of being expanded further as required. The initial
cost of providing the additional on-site spent fuel storage capability
required at ANO, River Bend, Waterford 3, and Grand Gulf 1 is expected
to be approximately $5 million to $10 million per unit. In addition,
about $3 million to $5 million per unit will be required every
two to three years subsequent to 2000 for ANO and every four to five
years subsequent to 2003, 2000, and 2004 for River Bend, Waterford 3,
and Grand Gulf 1, respectively, until the DOE's repository begins
accepting such units' spent fuel.
Entergy Operations and System Fuels joined in lawsuits against the
DOE, seeking clarification of the DOE's responsibility to receive spent
nuclear fuel beginning in 1998. The original suits, filed June 20,
1994, asked for a ruling stating that the Nuclear Waste Policy Act
require the DOE to begin taking title to the spent fuel and to start
removing it from nuclear power plants in 1998, a mandate for the DOE's
nuclear waste management program to begin accepting fuel in 1998 and
court monitoring of the program, and the potential for escrow of
payments to a nuclear waste fund instead of directly to the DOE.
Total decommissioning costs at December 31, 1995, for the System
nuclear power plants, excluding co-owner shares, have been estimated as
follows:
<TABLE>
<CAPTION>
Total Estimated
Decommissioning
Costs
(In Millions)
<S> <C>
ANO 1 and ANO 2 (based on a 1994 interim update to the 1992 cost study) $806.3
River Bend (based on a 1991 cost study reflecting 1990 dollars) 267.8
Waterford 3 (based on a 1994 updated study in 1993 dollars) 320.1
Grand Gulf 1 (based on a 1994 cost study using 1993 dollars) 365.9
--------
$1,760.1
========
</TABLE>
AP&L and LP&L are authorized to recover in rates amounts that,
when added to estimated investment income, should be sufficient to meet
the above estimated decommissioning costs for ANO and Waterford 3,
respectively. In the Texas retail jurisdiction, GSU is recovering in
rates decommissioning costs (based on the 1991 cost study) that, with
adjustments, total $204.9 million. In the Louisiana retail
jurisdiction, GSU is currently recovering in rates decommissioning
costs (based on a 1985 cost study) which total $141 million. GSU
included decommissioning costs (based on the 1991 study) in the LPSC
rate review filed in May 1995 which has not yet been concluded. System
Energy was previously recovering in rates amounts sufficient to fund
$198 million (in 1989 dollars) of its decommissioning costs. System
Energy included decommissioning costs (based on the 1994 study) in its
rate increase filing with FERC. Rates in this proceeding were placed
into effect in December 1995, subject to refund. AP&L, GSU, LP&L, and
System Energy periodically review and update estimated decommissioning
costs. Although the System is presently underrecovering based on the
above estimates, applications are periodically made to the appropriate
regulatory authorities to reflect in rates any future change in
projected decommissioning costs. The amounts recovered in rates are
deposited in trust funds and reported at market value as quoted on
nationally traded markets. These trust fund assets largely offset the
accumulated decommissioning liability that is recorded as accumulated
depreciation for AP&L, GSU, and LP&L, and as other deferred credits for
System Energy.
The cumulative liabilities and actual decommissioning expenses
recorded in 1995 by the System companies were as follows:
Cumulative 1995 1995 Cumulative
Liabilities as of Trust Decommissioning Liabilities as of
December 31, 1994 Earnings Expenses December 31, 1995
(In Millions)
ANO 1 and ANO 2 $137.4 $13.9 $17.7 $169.0
River Bend 22.2 1.4 8.1 31.7
Waterford 3 28.2 1.7 7.5 37.4
Grand Gulf 1 31.9 2.1 5.4 39.4
------ ----- ----- ------
$219.7 $19.1 $38.7 $277.5
====== ===== ===== ======
In 1994 and 1993, ANO's decommissioning expense was $12.2 million
and $11.0 million, respectively; River Bend's decommissioning expense
was $3.0 million, respectively; Waterford 3's decommissioning expense
was $4.8 million and $4.0 million, respectively; and Grand Gulf 1's
decommissioning expense was $5.2 million and $4.9 million,
respectively. The actual decommissioning costs may vary from the
estimates because of regulatory requirements, changes in technology,
and increased costs of labor, materials, and equipment. Management
believes that actual decommissioning costs are likely to be higher than
the estimated amounts presented above.
The staff of the SEC has questioned certain of the financial
accounting practices of the electric utility industry regarding the
recognition, measurement, and classification of decommissioning costs
for nuclear generating stations in the financial statements of electric
utilities. In response to these questions, the FASB has been reviewing
the accounting for decommissioning and has expanded the scope of its
review to include liabilities related to the closure and removal of all
long-lived assets. An exposure draft of the proposed SFAS was issued
in February 1996 would be effective in 1997. The proposed SFAS would
require measurement of the liability for closure and removal of long-
lived assets (including decommissioning) based on discounted future
cash flows. Those future cash flows should be determined by estimating
current costs and adjusting for inflation, efficiencies that may be
gained from experience with similar activities, and consideration of
reasonable future advances in technology. It also would require that
changes in the decommissioning/closure cost liability resulting from
changes in assumptions should be recognized with a corresponding
adjustment to the plant asset, and depreciation should be revised
prospectively. The proposed SFAS stated that the initial recognition
of the decommissioning/closure cost liability would result in an asset
that should be presented with other plant costs on the financial
statements because the cost of decommissioning/closing the plant is
recognized as part of the total cost of the plant asset. In addition
there would be a regulatory asset recognized on the financial
statements to the extent the initial decommissioning/closure liability
has increased due to the passage of time, and such costs are probable
of future recovery.
If current electric utility industry accounting practices with
respect to nuclear decommissioning and other closure costs are changed,
annual provisions for such costs could increase, the estimated cost for
decommissioning/closure could be recorded as a liability rather than as
accumulated depreciation, and trust fund income from decommissioning
trusts could be reported as investment income rather than as a
reduction to decommissioning expense.
The EPAct has a provision that assesses domestic nuclear utilities
with fees for the decontamination and decommissioning of the DOE's past
uranium enrichment operations. The decontamination and decommissioning
assessments will be used to set up a fund into which contributions from
utilities and the federal government will be placed. AP&L, GSU,
LP&L, and System Energy's annual assessments, which will be adjusted
annually for inflation, are approximately $3.4 million, $0.9 million,
$1.3 million, and $1.4 million (in 1995 dollars), respectively, for
approximately 15 years. At December 31, 1995, AP&L, GSU, LP&L, and
System Energy had recorded liabilities of $35.3 million, $6.0 million,
$13.2 million, and $12.8 million, respectively, for decontamination and
decommissioning fees in other current liabilities and other noncurrent
liabilities, and these liabilities were offset in the consolidated
financial statements by regulatory assets. FERC requires that
utilities treat these assessments as costs of fuel as they are
amortized and are recovered through rates in the same manner as other
fuel costs.
ANO Matters (Entergy Corporation and AP&L)
Cracks in steam generator tubes at ANO 2 were discovered and
repaired during an outage in March 1992. Further inspections and
repairs were conducted at subsequent refueling and mid-cycle outages,
including the most recent refueling outage in October 1995. Beginning
in January 1995, ANO 2's output was reduced 15 megawatts or 1.6% due to
secondary side fouling, tube plugging, and reduction of primary
temperature. During the October 1995 inspection, additional cracks in
the tubes were discovered. The unit may be approaching the limit for
the number of steam generator tubes that can be plugged with the unit
in operation. If the currently established limit is reached, Entergy
Operations could be required during future outages to insert sleeves in
some of the steam generator tubes that were previously plugged.
Entergy Operations is monitoring the development of the cracks and
assessing various options for the repair or the replacement of ANO 2's
steam generators. Certain of these options could, in the future,
require significant capital expenditures and result in additional
outages. However, a decision as to the repair or replacement of
ANO 2's steam generators is not expected prior to 1997. Entergy
Operations periodically meets with the NRC to discuss the results of
inspections of the generator tubes, as well as the timing of future
inspections.
Environmental Issues
(AP&L)
In May 1995, AP&L was named as a defendant in a suit by Reynolds
Metals Company (Reynolds), seeking to recover a share of the costs
associated with the clean-up of hazardous substances at a site south of
Arkadelphia, Arkansas. Reynolds alleges that it has spent $11.2
million to clean-up the site, and that the site was contaminated in
part with PCBs for which AP&L bears some responsibility. AP&L,
voluntarily, at its expense, has already completed remediation at a
nearby substation site and believes that it has no liability for
contamination at the site that is subject to the Reynolds suit and is
contesting the lawsuit. Regardless of the outcome, AP&L does not
believe this matter would have a materially adverse effect on its
financial condition or results of operations.
(GSU)
GSU has been designated as a PRP for the clean-up of certain
hazardous waste disposal sites. GSU is currently negotiating with the
EPA and state authorities regarding the clean-up of these sites. Several
class action and other suits have been filed in state and federal
courts seeking relief from GSU and others for damages caused by the
disposal of hazardous waste and for asbestos-related disease allegedly
resulting from exposure on GSU premises. While the amounts at issue in
the clean-up efforts and suits may be substantial, GSU believes that
its results of operations and financial condition will not be
materially adversely affected by the outcome of the suits. Through
December 31, 1995, $7.9 million has been expended on the clean-up. As
of December 31, 1995, a remaining recorded liability of $21.7 million
existed relating to the clean-up of five sites at which GSU has been
designated a PRP.
(LP&L)
During 1993, the LDEQ issued new rules for solid waste regulation,
including regulation of wastewater impoundments. LP&L has determined
that certain of its power plant wastewater impoundments were affected
by these regulations and has chosen to upgrade or close them. As a
result, a remaining recorded liability in the amount of $10.6 million
existed at December 31, 1995, for wastewater upgrades and closures to
be completed in 1996. Cumulative expenditures relating to the upgrades
and closures of wastewater impoundments were $5.6 million as of
December 31, 1995.
City Franchise Ordinances (NOPSI)
NOPSI provides electric and gas service in the City of New Orleans
pursuant to City franchise ordinances that state, among other things,
that the City has a continuing option to purchase NOPSI's electric and
gas utility properties.
NOTE 9. LEASES
General
As of December 31, 1995, the System had capital leases and
noncancelable operating leases for equipment, buildings, vehicles, and
fuel storage facilities (excluding nuclear fuel leases and the sale and
leaseback transactions) with minimum lease payments as follows:
Capital Leases
Year Entergy AP&L GSU
(In Thousands)
1996 $ 29,054 $ 11,126 $ 12,475
1997 24,653 8,293 12,475
1998 24,634 8,293 12,475
1999 24,610 8,294 12,475
2000 22,872 6,987 12,049
Years thereafter 113,421 41,708 69,331
Minimum lease payments 239,244 84,701 131,280
Less: Amount
representing interest 87,284 34,360 47,921
--------- ---------- ----------
Present value of net
minimum lease payments $ 151,960 $ 50,341 $ 83,359
========= ========== ==========
Operating Leases
Year Entergy AP&L GSU LP&L
(In Thousands)
1996 $ 76,866 $ 36,498 $ 12,871 $ 4,820
1997 66,009 29,460 12,566 4,369
1998 65,914 29,047 16,499 4,256
1999 63,198 27,304 16,499 3,990
2000 59,760 25,722 16,326 3,846
Years thereafter 214,577 71,272 60,518 1,905
--------- --------- --------- ----------
Minimum lease payments $ 546,324 $ 219,303 $ 135,279 $ 23,186
========= ========= ========= ==========
Rental expense for the System leases (excluding nuclear fuel
leases and the sale and leaseback transactions) amounted to
approximately $67.8 million, $64.8 million, and $62.7 million in 1995,
1994, and 1993, respectively. These amounts include $27.7 million,
$26.4 million, and $23.2 million, respectively, for AP&L, $15.1
million, $15.3 million, and $31.9 million, respectively for GSU, and
$14.8 million, $12.1 million, and $6.6 million, respectively, for LP&L.
Nuclear Fuel Leases
AP&L, GSU, LP&L, and System Energy each has arrangements to lease
nuclear fuel in an aggregate amount up to $395 million as of December
31, 1995. The lessors finance the acquisition and ownership of nuclear
fuel through credit agreements and the issuance of notes. These
agreements are subject to annual renewal with, in LP&L's and GSU's
case, the consent of the lenders. The credit agreements for AP&L, GSU,
LP&L, and System Energy have been extended and now have termination
dates of December 1998, December 1998, January 1999, and February 1999,
respectively. The debt securities issued pursuant to these fuel lease
arrangements have varying maturities through January 31, 1999. It is
expected that the credit agreements will be extended or alternative
financing will be secured by each lessor upon the maturity of the
current arrangements. If extensions or alternative financing cannot be
arranged, the lessee in each case must purchase sufficient nuclear fuel
to allow the lessor to retire such borrowings.
Lease payments are based on nuclear fuel use. Nuclear fuel lease
expense charged to operations by the System in 1995, 1994, and 1993 was
$153.5 million (including interest of $22.1 million), $163.4 million
(including interest of $27.3 million), and $145.8 million (excluding
GSU and including interest of $20.5 million), respectively.
Specifically, in 1995, 1994, and 1993, AP&L's expense was $46.8
million, $56.2 million, and $69.7 million (including interest of $6.7
million, $7.5 million, and $10.6 million), respectively; GSU's expense
was $41.4 million, $37.2 million, and $43.6 million (including interest
of $6.0 million, $8.7 million, and $10.2 million), respectively; LP&L's
expense was $30.8 million, $32.2 million, and $39.9 million (including
interest of $3.7 million, $4.3 million, and $4.9 million),
respectively; System Energy's expense was $34.5 million, $37.8 million,
and $36.2 million (including interest of $5.7 million, $6.8 million,
and $5.1 million), respectively.
Sale and Leaseback Transactions
Waterford 3 Lease Obligations (LP&L)
On September 28, 1989, LP&L entered into three transactions for
the sale (for an aggregate cash consideration of $353.6 million) and
leaseback of three undivided portions of its 100% ownership interest in
Waterford 3. The three undivided interests in Waterford 3 sold and
leased back exclude certain transmission, pollution control, and other
facilities that are part of Waterford 3. The interests sold and leased
back are equivalent on an aggregate cost basis to approximately a 9.3%
undivided interest in Waterford 3. LP&L is leasing back the interests
on a net lease basis over an approximate 28-year basic lease term.
LP&L has options to terminate the lease and to repurchase the interests
in Waterford 3 at certain intervals during the basic lease term.
Further, at the end of the basic lease term, LP&L has an option to
renew the lease or to repurchase the undivided interests in Waterford
3.
Interests were acquired from LP&L with funds obtained from the
issuance and sale by the purchasers of intermediate-term and long-term
secured lease obligation bonds. The lease payments to be made by LP&L
will be sufficient to service such debt.
LP&L did not exercise its option to repurchase the undivided
interests in Waterford 3 in September 1994. As a result, LP&L was
required to provide collateral for the equity portion of certain
amounts payable by LP&L under the leases. Such collateral was in the
form of a new series of non interest-bearing first mortgage bonds in
the aggregate principal amount of $208.2 million issued by LP&L in
September 1994.
Upon the occurrence of certain adverse events (including lease
events of default, events of loss, deemed loss events or certain
adverse "Financial Events" with respect to LP&L), LP&L may be obligated
to pay amounts sufficient to permit the termination of the lease
transactions and may be required to assume the outstanding indebtedness
issued to finance the acquisition of the undivided interests in
Waterford 3. "Financial Events" include, among other things, failure
by LP&L, following the expiration of any applicable grace or cure
periods, to maintain (1) as of the end of any fiscal quarter, total
equity capital (including preferred stock) at least equal to 30% of
adjusted capitalization, or (2) in respect of the 12-month period
ending on the last day of any fiscal quarter, a fixed charge coverage
ratio of at least 1.50. As of December 31, 1995, LP&L's total equity
capital (including preferred stock) was 48.7% of adjusted
capitalization and its fixed charge coverage ratio was 3.29.
As of December 31, 1995, LP&L had future minimum lease payments
(reflecting an overall implicit rate of 8.76%) in connection with the
Waterford 3 sale and leaseback transactions as follows (in thousands):
1996 $ 35,165
1997 39,805
1998 41,447
1999 50,530
2000 47,510
Years thereafter 628,704
-----------
Total 843,161
Less: Amount representing interest 489,561
-----------
Present value of net minimum lease payments $ 353,600
===========
Grand Gulf 1 Lease Obligations (System Energy)
On December 28, 1988, System Energy entered into two arrangements
for the sale and leaseback of an aggregate 11.5% undivided ownership
interest in Grand Gulf 1 for an aggregate cash consideration of $500
million. System Energy is leasing back the undivided interest on a net
lease basis over a 26 1/2-year basic lease term. System Energy has
options to terminate the leases and to repurchase the undivided
interest in Grand Gulf 1 at certain intervals during the basic lease
term. Further, at the end of the basic lease term, System Energy has
an option to renew the leases or to repurchase the undivided interest
in Grand Gulf 1. See Note 8 with respect to certain other terms of the
transactions.
In accordance with SFAS 98, "Accounting for Leases," due to
"continuing involvement" by System Energy, the sale and leaseback
arrangements of the undivided portions of Grand Gulf 1, as described
above, are required to be reflected for financial reporting purposes as
financing transactions in System Energy's financial statements. The
amounts charged to expense for financial reporting purposes include the
interest portion of the lease obligations and depreciation of the
plant. However, operating revenues include the recovery of the lease
payments because the transactions are accounted for as sales and
leasebacks for rate-making purposes. The total of interest and
depreciation expense exceeds the corresponding revenues realized during
the early part of the lease term. Consistent with a recommendation
contained in a FERC audit report, System Energy recorded as a deferred
asset the difference between the recovery of the lease payments and the
amounts expensed for interest and depreciation and is recording such
difference as a deferred asset on an ongoing basis. The amount of this
deferred asset was $85.8 million and $78.5 million as of December 31,
1995, and 1994, respectively.
As of December 31, 1995, System Energy had future minimum lease
payments (reflecting an implicit rate of 7.02% after the above
refinancing) as follows (in thousands):
1996 $ 42,753
1997 42,753
1998 42,753
1999 42,753
2000 42,753
Years thereafter 760,067
-----------
Total 973,832
Less: Amount representing interest 473,832
-----------
Present value of net minimum lease payments $ 500,000
===========
NOTE 10. POSTRETIREMENT BENEFITS (Entergy Corporation, AP&L, GSU,
LP&L, MP&L, NOPSI, and System Energy)
Pension Plans
The System companies have various postretirement benefit plans
covering substantially all of their employees. The pension plans are
noncontributory and provide pension benefits that are based on
employees' credited service and compensation during the final years
before retirement. Entergy Corporation and its subsidiaries fund
pension costs in accordance with contribution guidelines established by
the Employee Retirement Income Security Act of 1974, as amended, and
the Internal Revenue Code of 1986, as amended. The assets of the plans
include common and preferred stocks, fixed income securities, interest
in a money market fund, and insurance contracts. Prior to January 1,
1995, all System Companies' non-bargaining employees were generally
included in a plan sponsored by the System company where they were
employed. However, NOPSI was a participating employer in a plan
sponsored by LP&L. Effective January 1, 1995, these employees became
participants in a new plan with provisions substantially identical to
their previous plan.
Total 1995, 1994, and 1993 pension cost of Entergy Corporation and
its subsidiaries (excluding GSU for 1993 for the Entergy Corporation
total), including amounts capitalized, included the following
components (in thousands):
<TABLE>
<CAPTION>
1995 System
Entergy AP&L GSU LP&L MP&L NOPSI Energy
<S> <C> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 29,282 $ 7,786 $ 6,686 $ 4,143 $ 2,152 $ 1,158 $ 2,260
during the period
Interest cost on projected 80,794 24,372 21,098 15,111 9,240 2,680 2,230
benefit obligation
Actual return on plan assets (261,864) (71,807) (82,624) (53,348) (30,443) (1,614) (8,827)
Net amortization and deferral 178,345 47,766 53,921 34,902 20,081 64 5,510
--------- --------- --------- ---------- --------- --------- ---------
Net pension cost $ 26,557 $ 8,117 $ (919) $ 808 $ 1,030 $ 2,288 $ 1,173
========= ========= ========= ========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
1994 System
Entergy AP&L GSU LP&L MP&L NOPSI Energy
<S> <C> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 35,712 $ 8,854 $ 9,497 $ 5,441 $ 2,484 $ 1,502 $ 2,619
during the period
Interest cost on projected 77,943 22,651 21,335 14,473 8,648 2,740 2,148
benefit obligation
Actual return on plan assets 10,381 365 6,785 2,024 1,507 - 498
Net amortization and deferral (96,893) (24,474) (39,405) (19,981) (11,843) (970) (3,535)
Other 17,963 - 17,963 - - - -
-------- --------- -------- --------- ---------- --------- ---------
Net pension cost $ 45,106 $ 7,396 $ 16,175 $ 1,957 $ 796 $ 3,272 $ 1,730
======== ========= ======== ========= ========== ========= =========
</TABLE>
<TABLE>
<CAPTION>
1993 System
Entergy AP&L GSU LP&L MP&L NOPSI Energy
<S> <C> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 21,760 $ 7,940 $ 10,417 $ 4,900 $ 2,409 $ 1,387 $ 2,045
during the period
Interest cost on projected 53,371 21,744 17,643 14,684 8,583 2,422 1,709
benefit obligation
Actual return on plan assets (81,708) (31,984) (43,400) (26,533) (15,053) - (3,828)
Net amortization and deferral 27,261 10,531 14,863 8,712 5,325 (49) 972
-------- --------- ----------- --------- --------- --------- ----------
Net pension cost $ 20,684 $ 8,231 $ (477) $ 1,763 $ 1,264 $ 3,760 $ 898
======== ========= =========== ========= ========= ========= ==========
</TABLE>
The funded status of Entergy's various pension plans as of
December 31, 1995 and 1994 was (in thousands):
<TABLE>
<CAPTION>
1995 System
Entergy AP&L GSU LP&L MP&L NOPSI Energy
<S> <C> <C> <C> <C> <C> <C> <C>
Actuarial present value of
accumulated pension
plan obligation:
Vested $989,509 $298,358 $256,173 $192,697 $116,851 $44,324 $23,692
Nonvested 4,555 1,342 792 705 147 29 640
--------- -------- -------- -------- -------- ------- -------
Accumulated benefit obligation 994,064 299,700 256,965 193,402 116,998 44,353 24,332
--------- -------- -------- -------- -------- ------- -------
Plan assets at fair value 1,224,594 337,929 374,010 245,521 140,513 18,658 41,951
Projected benefit obligation 1,156,831 341,946 289,666 218,715 129,180 51,699 36,491
--------- -------- -------- -------- -------- ------- -------
Plan assets in excess of 67,763 (4,017) 84,344 26,806 11,333 (33,041) 5,460
(less than) projected benefit
obligation
Unrecognized prior service cost 35,946 15,042 12,021 6,469 4,883 2,224 1,180
Unrecognized transition asset (46,856) (14,015) (11,937) (16,845) (7,502) (963) (5,887)
Unrecognized net loss (gain) (94,618) (23,545) (135,303) (28,060) (13,832) 22,751 (3,074)
--------- -------- -------- -------- -------- ------- -------
Accrued pension asset (liability) ($37,765) ($26,535) ($50,875) ($11,630) ($5,118) ($9,029) ($2,321)
========= ======== ======== ======== ======== ======= =======
</TABLE>
<TABLE>
<CAPTION>
1994 System
Entergy AP&L GSU LP&L MP&L NOPSI Energy
<S> <C> <C> <C> <C> <C> <C> <C>
Actuarial present value of
accumulated pension
plan obligation:
Vested $851,194 $238,769 $273,509 $154,927 $94,978 $26,291 $13,305
Nonvested 6,479 1,797 1,502 795 299 41 986
--------- -------- -------- -------- -------- ------- -------
Accumulated benefit obligation 857,673 240,566 275,011 155,722 95,277 26,332 14,291
--------- -------- -------- -------- -------- ------- -------
Plan assets at fair value 1,014,430 283,437 313,035 198,724 117,853 18,180 33,285
Projected benefit obligation 999,153 283,256 290,802 178,895 109,250 33,738 27,239
--------- -------- -------- -------- -------- ------- -------
Plan assets in excess of 15,277 181 22,233 19,829 8,603 (15,558) 6,046
(less than) projected benefit
obligation
Unrecognized prior service cost 25,501 6,568 13,720 4,881 4,198 2,291 1,242
Unrecognized transition asset (54,209) (16,350) (14,324) (19,653) (8,752) (1,159) (6,484)
Unrecognized net loss (gain) (9,332) (12,453) (73,423) (16,677) (8,138) 5,779 (1,952)
Other - - - (1,584) - 1,584 -
--------- -------- -------- -------- -------- ------- -------
Accrued pension asset (liability) ($22,763) ($22,054) ($51,794) ($13,204) ($4,089) ($7,063) ($1,148)
========= ======== ======== ======== ======== ======= =======
</TABLE>
The significant actuarial assumptions used in computing the
information above for 1995, 1994, and 1993 (only 1995 and 1994 with
respect to GSU being included in the Entergy Corporation total), were
as follows: weighted average discount rate, 7.5% for 1995, 8.5% for
1994, and 7.5% for 1993, weighted average rate of increase in future
compensation levels, 4.6% for 1995, 5.1% for 1994 and 5.6% (5% for GSU)
for 1993; and expected long-term rate of return on plan assets, 8.5% .
Transition assets of the System are being amortized over the greater of
the remaining service period of active participants or 15 years.
In 1994, GSU recorded an $18.0 million charge related to early
retirement programs in connection with the Merger, of which $15.2
million was expensed.
Other Postretirement Benefits
The System companies also provide certain health care and life
insurance benefits for retired employees. Substantially all employees
may become eligible for these benefits if they reach retirement age
while still working for the System companies.
Effective January 1, 1993, Entergy adopted SFAS 106. The new
standard required a change from a cash method to an accrual method of
accounting for postretirement benefits other than pensions. The
Operating Companies, other than MP&L and NOPSI, continue to fund these
benefits on a pay-as-you-go basis. During 1994, pursuant to regulatory
directives, MP&L and NOPSI began to fund their postretirement benefit
obligation. These assets are invested in a money market fund. At
January 1, 1993, the actuarially determined accumulated postretirement
benefit obligation (APBO) earned by retirees and active employees was
estimated to be approximately $241.4 million and $128 million for
Entergy (other than GSU) and for GSU, respectively. Such obligations
are being amortized over a 20-year period beginning in 1993.
The Operating Companies have sought approval, in their respective
regulatory jurisdictions, to implement the appropriate accounting
requirements related to SFAS 106 for ratemaking purposes. AP&L has
received an order permitting deferral, as a regulatory asset, of the
difference between its annual cash expenditures for postretirement
benefits other than pensions and the SFAS 106 accrual, for up to a five-
year period commencing January 1, 1993. MP&L is expensing its SFAS 106
costs, which are reflected in rates pursuant to an order from the MPSC
in connection with MP&L's formulary incentive-rate plan (see Note 2).
The LPSC ordered GSU and LP&L to continue the use of the pay-as-you-go
method for ratemaking purposes for postretirement benefits other than
pensions, but the LPSC retains the flexibility to examine individual
companies' accounting for postretirement benefits to determine if
special exceptions to this order are warranted. NOPSI is expensing its
SFAS 106 costs. Pursuant to resolutions adopted in November 1993 by
the Council related to the Merger, NOPSI's SFAS 106 expenses through
October 31, 1996, will be allowed by the Council for purposes of
evaluating the appropriateness of NOPSI's rates. Pursuant to the
PUCT's May 26, 1995, amended order, GSU is currently collecting its SFAS
106 costs in rates.
Total 1995, 1994 and 1993 postretirement benefit cost of Entergy
Corporation and its subsidiaries (excluding GSU for the Entergy
Corporation total for 1993), including amounts capitalized and
deferred, included the following components (in thousands):
<TABLE>
<CAPTION>
1995
Entergy AP&L GSU LP&L MP&L NOPSI
<S> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 10,797 $ 2,777 $ 1,864 $ 2,047 $ 909 $ 650
during the period
Interest cost on APBO 25,629 5,398 8,526 4,215 1,969 3,258
Actual return on plan assets (759) - - - (245) (514)
Net amortization and deferral 11,023 2,702 4,477 2,121 988 1,876
-------- -------- -------- --------- --------- ---------
Net postretirement benefit cost $ 46,690 $ 10,877 $ 14,867 $ 8,383 $ 3,621 $ 5,270
======== ======== ======== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
1994
Entergy AP&L GSU LP&L MP&L NOPSI
<S> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 11,863 $ 3,080 $ 2,169 $ 2,433 $ 876 $ 813
during the period
Interest cost on APBO 23,312 5,510 6,449 4,422 1,833 3,502
Actual return on plan assets - - - - - -
Net amortization and deferral 9,891 3,833 2,832 3,066 1,122 2,569
-------- -------- -------- --------- --------- ---------
Net postretirement benefit cost $ 45,066 $ 12,423 $ 11,450 $ 9,921 $ 3,831 $ 6,884
======== ======== ======== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
1993
Entergy AP&L GSU LP&L MP&L NOPSI
<S> <C> <C> <C> <C> <C> <C>
Service cost - benefits earned $ 7,751 $ 2,366 $ 5,467 $ 2,083 $ 812 $ 822
during the period
Interest cost on APBO 19,394 6,427 9,976 4,749 2,400 4,248
Actual return on plan assets (71) (71) - - - -
Net amortization and deferral 12,071 3,954 6,402 2,971 1,502 2,678
-------- -------- -------- --------- --------- ---------
Net postretirement benefit cost $ 39,145 $ 12,676 $ 21,845 $ 9,803 $ 4,714 $ 7,748
======== ======== ======== ========= ========= =========
</TABLE>
The funded status of Entergy's postretirement plans as of December
31, 1995 and 1994, was (in thousands):
<TABLE>
<CAPTION>
1995
Entergy AP&L GSU LP&L MP&L NOPSI
<S> <C> <C> <C> <C> <C> <C>
Actuarial present value of accumulated
postretirement benefit obligation:
Retirees $244,192 $46,633 $101,698 $36,262 $15,957 $33,652
Other fully eligible participants 48,393 9,161 17,334 7,614 4,619 3,215
Other active participants 71,464 16,745 15,980 13,288 5,692 4,306
--------- -------- -------- -------- ------- -------
Accumulated benefit obligation 364,049 72,539 135,012 57,164 26,268 41,173
Plan assets at fair value 15,494 - - - 5,151 10,343
--------- -------- -------- -------- ------- -------
Plan assets less than APBO (348,555) (72,539) (135,012) (57,164) (21,117) (30,830)
Unrecognized transition obligation 204,348 67,206 107,975 50,517 25,533 45,539
Unrecognized net loss (gain)/other (1,639) (16,757) (617) (8,556) (6,179) (13,835)
--------- -------- -------- -------- ------- -------
Accrued postretirement benefit liability ($145,846) ($22,090) ($27,654) ($15,203) ($1,763) $874
========= ======== ======== ======== ======= =======
</TABLE>
<TABLE>
<CAPTION>
1994
Entergy AP&L GSU LP&L MP&L NOPSI
<S> <C> <C> <C> <C> <C> <C>
Actuarial present value of accumulated
postretirement benefit obligation:
Retirees $186,570 $49,291 $39,695 $38,401 $15,531 $38,059
Other fully eligible participants 58,330 9,876 26,069 8,550 4,293 3,351
Other active participants 52,324 12,204 13,445 9,695 3,561 3,551
--------- -------- -------- -------- ------- -------
Accumulated benefit obligation 297,224 71,371 79,209 56,646 23,385 44,961
Plan assets at fair value 9,733 - - - 2,949 6,784
--------- -------- -------- -------- ------- -------
Plan assets less than APBO (287,491) (71,371) (79,209) (56,646) (20,436) (38,177)
Unrecognized transition obligation 217,275 71,160 115,232 53,488 27,035 48,217
Unrecognized net loss (gain) (58,178) (16,272) (57,410) (8,253) (8,636) (10,057)
--------- -------- -------- -------- ------- -------
Accrued postretirement benefit liability ($128,394) ($16,483) ($21,387) ($11,411) ($2,037) ($17)
========= ======== ======== ======== ======= =======
</TABLE>
The assumed health care cost trend rate used in measuring the APBO
of the System companies was 8.4% for 1996, gradually decreasing each
successive year until it reaches 5.0% in 2005. A one percentage-point
increase in the assumed health care cost trend rate for each year would
have increased the APBO of the System companies, as of December 31,
1995, by 11.3% (AP&L-11.8%, GSU-10.4%, LP&L-11.8%, MP&L-12.2% and NOPSI-
10.0%), and the sum of the service cost and interest cost by
approximately 14.1% (AP&L-15.0%, GSU-12.8%, LP&L-14.4%, MP&L-14.4% and
NOPSI-12.8%). The assumed discount rate and rate of increase in future
compensation used in determining the APBO were 7.5% for 1995, 8.5% for
1994 and 7.5% for 1993, and 4.6% for 1995, 5.1% for 1994 and 5.5% (5%
for GSU) for 1993, respectively. The expected long-term rate of return
on plan assets was 8.5% for 1995.
NOTE 11. RESTRUCTURING COSTS (Entergy Corporation, AP&L, GSU, LP&L,
MP&L, and NOPSI)
The restructuring programs announced by Entergy in 1994 and 1995
included anticipated reductions in the number of employees and the
consolidation of offices and facilities. The programs are designed to
reduce costs, improve operating efficiencies, and increase shareholder
value in order to enable Entergy to become a low-cost producer. The
balances as of December 31, 1994, and 1995, for restructuring
liabilities associated with these programs are shown below by company
along with the actual termination benefits paid under the programs.
Restructuring Restructuring
Liability as of Additional Payments Liability as of
December 31, 1995 Made in December 31,
Company 1994 Charges 1995 1995
(In Millions)
AP&L $12.2 $16.2 ($20.1) $8.3
GSU 6.5 13.1 (14.2) $5.4
LP&L 6.8 6.4 (11.0) $2.2
MP&L 6.2 2.9 (6.6) $2.5
NOPSI 3.4 0.2 (3.0) $0.6
Other - 9.6 (4.4) $5.2
----- ----- ------ -----
Total $35.1 $48.4 ($59.3) $24.2
===== ===== ====== =====
The restructuring charges shown above primarily included employee
severance costs related to the expected termination of approximately
2,750 employees in various groups. As of December 31, 1995, 2,100
employees had either been terminated or accepted voluntary separation
packages under the restructuring plan.
Additionally, the System recorded $24.3 million in 1994 (of which
$23.8 million was recorded by GSU) for remaining severance and
augmented retirement benefits related to the Merger. Actual
termination benefits paid under the program during 1995 amounted to
$21.6 million. During that same period, adjustments to the allocation
of the total liability were made among the System companies. At
December 31, 1995, the total remaining System liability for expected
future Merger-related outlays was $2.8 million, comprised principally
of GSU's liability of $2.3 million.
NOTE 12. TRANSACTIONS WITH AFFILIATES (AP&L, GSU, LP&L, MP&L, NOPSI,
and System Energy)
The various Operating Companies purchase electricity from and/or
sell electricity to other Operating Companies, System Energy, and
Entergy Power (in the case of AP&L) under rate schedules filed with
FERC. In addition, the Operating Companies and System Energy purchase
fuel from System Fuels, receive technical, advisory, and administrative
services from Entergy Services, and receive management and operating
services from Entergy Operations.
As described in Note 1, all of System Energy's operating revenues
consist of billings to AP&L, LP&L, MP&L, and NOPSI.
The tables below contain the various affiliate transactions among
the Operating Companies and System Entergy (in millions).
Intercompany Revenues
System
AP&L GSU LP&L MP&L NOPSI Energy
1995 $ 195.5 $62.7 $ 1.6 $ 43.3 $ 3.2 $ 605.6
1994 $ 232.6 $44.4 $ 1.0 $ 45.8 $ 2.1 $ 475.0
1993 $ 175.8 $ - $ 4.8 $ 40.7 $ 2.5 $ 650.8
Intercompany Operating Expenses
System
AP&L(1) GSU LP&L MP&L NOPSI Energy
1995 $ 316.0 $ 266.5 $ 335.5 $ 262.6 $ 164.4 $ 6.5
1994 $ 310.7 $ 296.9 $ 365.8 $ 280.2 $ 170.1 $ 10.5
1993 $ 323.2 $ 25.5 $ 322.0 $ 360.5 $ 176.3 $ 12.3
(1) Includes $31.0 million in 1995, $25.7 million in 1994, and $16.8
million in 1993 for power purchased from Entergy Power.
Operating Expenses Paid or Reimbursed to Entergy Operations
System
AP&L GSU LP&L Energy
1995 $ 189.8 $ 129.1 $ 122.6 $ 116.9
1994 $ 221.2 $ 210.2 $ 152.5 $ 179.6
1993 $ 226.3 $ - $ 118.9 $ 151.3
In addition, certain materials and services required for
fabrication of nuclear fuel are acquired and financed by System Fuels
and then sold to System Energy as needed. Charges for these materials
and services, which represent additions to nuclear fuel, amounted to
approximately $51.5 million in 1995, $26.4 million in 1994, and $32.8
million in 1993.
NOTE 13. ENTERGY CORPORATION-GSU MERGER
On December 31, 1993, Entergy Corporation and GSU consummated the
Merger. GSU became a wholly owned subsidiary of Entergy Corporation
and continues to operate as an electric utility corporation under the
regulation of FERC, the SEC, the PUCT, and the LPSC. As consideration
to GSU's shareholders, Entergy Corporation paid $250 million and issued
56,695,724 shares of its common stock in exchange for the 114,055,065
outstanding shares of GSU common stock. In addition, $33.5 million of
transaction costs were capitalized in connection with the Merger. Note
1 describes the accounting for the acquisition adjustment recorded in
connection with the Merger.
The pro forma combined revenues, net income, earnings per common
share before extraordinary items, cumulative effect of accounting
changes, and earnings per common share of Entergy Corporation presented
below give effect to the Merger as if it had occurred at January 1,
1992. This unaudited pro forma information is not necessarily
indicative of the results of operations that would have occurred had
the Merger been consummated for the period for which it is being given
effect.
Years Ended December 31
1993 1992
(In Thousands, Except Per Share Amounts)
Revenues $6,286,999 $5,850,973
Net income $ 595,211 $ 521,783
Earnings per average common share
before extraordinary items and
cumulative effect of accounting changes $ 2.10 $ 2.26
Earnings per average common share $ 2.57 $ 2.24
NOTE 14. BUSINESS SEGMENT INFORMATION
NOPSI supplies electric and natural gas services in the City.
NOPSI's segment information follows:
<TABLE>
<CAPTION>
1995 1994 1993
Electric Gas Electric Gas Electric Gas
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
Operating revenues $394,394 $80,276 $360,430 $87,357 $423,830 $90,992
Revenue from sales to
unaffiliated customers (1) $391,977 $80,276 $358,369 $87,357 $421,343 $90,992
Operating income
before income taxes $ 61,092 $ 9,638 $ 23,976 $ 9,387 $ 72,572 $11,412
Operating income $ 43,489 $ 7,405 $ 22,358 $ 7,403 $ 52,046 $ 7,706
Net utility plant $204,407 $65,236 $209,901 $67,875 $211,776 $63,803
Depreciation expense $ 15,858 $ 3,290 $ 15,743 $ 3,310 $ 14,308 $ 2,976
Construction expenditures $ 21,729 $ 6,107 $ 16,997 $ 5,780 $ 19,774 $ 5,039
</TABLE>
(1) NOPSI's intersegment transactions are not material (less than 1%
of sales to unaffiliated customers).
NOTE 15. SUBSEQUENT EVENT (UNAUDITED)
Acquisition of CitiPower (Entergy Corporation)
On January 5, 1996, Entergy Corporation finalized its acquisition
of CitiPower, an electric distribution utility serving Melbourne,
Australia. Entergy Corporation made an equity investment of $294
million in CitiPower and the remainder of the total purchase price of
approximately $1.2 billion was made up of new CitiPower debt.
CitiPower has 234,500 customers, the majority of which are commercial
customers.
NOTE 16. QUARTERLY FINANCIAL DATA (UNAUDITED)
(Entergy Corporation, AP&L, GSU, LP&L, MP&L, NOPSI, and
System Energy)
The business of the System is subject to seasonal fluctuations
with the peak period occurring during the third quarter. Operating
results for the four quarters of 1995 and 1994 were:
<TABLE>
<CAPTION>
Operating Revenues
System
Entergy AP&L GSU(a) LP&L MP&L NOPSI(d) Energy(e)
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
1995:
First Quarter $1,333,768 $339,596 $399,346 $353,462 $193,579 $108,886 $151,664
Second Quarter 1,555,381 412,164 479,609 406,576 236,120 112,666 158,632
Third Quarter 1,959,428 530,448 540,287 529,457 259,223 146,720 144,758
Fourth Quarter 1,425,851 366,025 442,732 385,380 200,921 106,398 150,585
1994:
First Quarter 1,404,779 371,091 429,658 384,296 185,687 117,088 147,847
Second Quarter 1,587,558 414,901 456,855 442,113 230,580 124,402 151,219
Third Quarter 1,829,214 470,770 545,531 502,926 257,496 133,574 150,949
Fourth Quarter 1,155,570 333,980 365,321 381,080 186,082 72,723 24,948
</TABLE>
<TABLE>
<CAPTION>
Operating Income (Loss)
System
Entergy AP&L(b)(c) GSU(a)(b) LP&L(c) MP&L(c) NOPSI(c)(d) Energy(e)
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
1995:
First Quarter $234,560 $29,682 $47,371 $69,317 $22,270 $10,863 $60,072
Second Quarter 333,825 67,367 88,778 85,970 32,792 12,500 61,290
Third Quarter 445,975 94,076 113,531 125,168 41,789 21,085 57,663
Fourth Quarter 205,378 26,806 54,749 51,814 19,821 6,446 57,270
1994:
First Quarter 253,870 44,674 58,561 68,668 18,715 6,459 64,342
Second Quarter 325,935 59,581 83,357 80,686 33,828 17,880 65,779
Third Quarter 336,611 56,163 64,853 99,824 23,675 15,941 65,869
Fourth Quarter 152,325 56,215 6,880 93,942 19,539 (10,519) (24,223)
</TABLE>
<TABLE>
<CAPTION>
Net Income (Loss)
System
Entergy(f) AP&L(b)(c)(f) GSU(a)(b) LP&L(c) MP&L(c) NOPSI(c)(d) Energy(e)
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
1995:
First Quarter $90,392 $10,714 $3,635 $36,062 $9,774 $6,245 $22,565
Second Quarter 162,703 47,844 43,353 53,082 20,578 8,688 23,802
Third Quarter 263,118 73,963 68,112 92,819 29,228 16,862 23,366
Fourth Quarter 3,767 39,559 7,819 19,574 9,087 2,591 23,306
1994:
First Quarter 70,735 26,388 11,043 37,096 6,249 1,813 21,549
Second Quarter 144,337 41,763 33,084 48,353 21,653 13,812 25,212
Third Quarter 143,198 36,630 (31,662) 67,029 10,856 11,933 24,934
Fourth Quarter (16,429) 37,482 (95,220) 61,361 10,021 (14,347) (66,288)
</TABLE>
(a)See Note 2 for information regarding the recording of a reserve for
rate refund in December 1994.
(b)See Note 11 for information regarding the recording of certain
restructuring costs in 1994 and 1995.
(c)See Note 3 for information regarding the write-off of certain
unamortized deferred investment tax credits in the fourth quarter
of 1994.
(d)See Note 2 for information regarding credits and refunds recorded
in 1994 as a result of the 1994 NOPSI Settlement.
(e)See Note 2 for information regarding the recording of refunds in
connection with the FERC Settlement in November 1994.
(f)The fourth quarter of 1995 reflects an increase in net income of
$35.4 million (net of income taxes of $22.9 million) and an
increase in earnings per share of $.15 due to the recording of the
cumulative effect of the change in accounting method for
incremental nuclear refueling outage maintenance costs. See Note 1
for a discussion of the change in accounting method.
Earnings (Loss) per Average Common Share (Entergy Corporation)
1995 1994
First Quarter $0.40 $ 0.31
Second Quarter $0.71 $ 0.63
Third Quarter $1.16 $ 0.63
Fourth Quarter (f) $0.02 $(0.07)
<PAGE>
Item 9. Changes In and Disagreements With Accountants On Accounting
and Financial Disclosure.
No event that would be described in response to this item has
occurred with respect to Entergy, System Energy, AP&L, GSU, LP&L,
MP&L, or NOPSI.
PART III
Item 10. Directors and Executive Officers of the Registrants.
All officers and directors listed below held the specified
positions with their respective companies as of the date of filing
this report.
ENTERGY CORPORATION
Directors
Information required by this item concerning directors of
Entergy Corporation is set forth under the heading "Election of
Directors" contained in the Proxy Statement of Entergy Corporation to
be filed in connection with its Annual Meeting of Stockholders to be
held May 17, 1996, and is incorporated herein by reference.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Name Age Position Period
Officers
Edwin Lupberger(a) 59 Chairman of the Board, Chief 1985-Present
Executive Officer, President, and
Director of Entergy Corporation
Chairman of the Board and Chief 1993-Present
Executive Officer of AP&L, LP&L,
MP&L, and NOPSI
Chairman of the Board, Chief 1994-Present
Executive Officer and Director of
GSU
Chairman of the Board of System 1986-Present
Energy and Entergy Enterprises
Chairman of the Board of Entergy 1990-Present
Operations
Chairman of the Board of Entergy 1985-Present
Services
Chief Executive Officer of Entergy 1991-Present
Services
Chief Executive Officer of Entergy 1993-Present
Power, Entergy Power Development
Corporation, and Entergy-Richmond
Power Corporation
Chief Executive Officer of Entergy 1994-Present
Pakistan, Ltd. and Entergy Power
Asia, Ltd.
Chief Executive Officer of Entergy 1995-Present
EDEGEL I, Inc., EP EDEGEL, Inc.,
Entergy Power Development
International Corporation, Entergy
Power Holding I, Ltd., Entergy
Power Holding II, Ltd., Entergy
Power Marketing Corporation,
Entergy Power Operations
Corporation, Entergy Power
Operations Holdings, Ltd., Entergy
Power Operations Pakistan LDC,
Entergy Victoria LDC, Entergy
Victoria Holdings LDC, Entergy
Yacyreta I, Inc., EPG Cayman
Holding I, EPG Cayman Holding II
President of Entergy Corporation 1995-Present
President of Entergy Services and 1994-Present
Entergy Enterprises
Director of AP&L, LP&L, MP&L, 1986-Present
NOPSI, and System Energy
Director of Entergy Operations and 1994-Present
Entergy Services
Director of Entergy Enterprises 1984-Present
Chairman of the Board of Entergy 1990-1993
Power
Chief Executive Officer of Entergy 1991-1994
Enterprises
President of Entergy Corporation 1985-1991
President of Entergy Services and 1990-1991
Entergy Enterprises
Director of System Fuels 1986-1992
Jerry L. Maulden 59 Vice Chairman of Entergy 1995-Present
Corporation
Vice Chairman and Chief Operating 1993-Present
Officer of AP&L, GSU, LP&L, MP&L,
and NOPSI
Vice Chairman of Entergy Services 1992-Present
Director of AP&L 1979-Present
Director of GSU 1993-Present
Director of LP&L and NOPSI 1991-Present
Director of MP&L 1988-Present
Director of Entergy Operations 1990-Present
Director of System Energy 1987-Present
Director of Entergy Services 1979-Present
Chairman of the Board of AP&L 1989-1993
Chairman of the Board and Chief 1991-1993
Executive Officer of LP&L and
NOPSI
Chairman of the Board and Chief 1989-1993
Executive Officer of MP&L
Chief Executive Officer of AP&L 1979-1993
President and Chief Operating 1993-1995
Officer of Entergy Corporation
Senior Vice President, System 1988-1991
Executive -
Arkansas/Mississippi/Missouri
Division of Entergy Corporation
Group President, System Executive - 1991-1993
Transmission, Distribution, and
Customer Service of Entergy
Corporation
Group President, System Executive - 1991-1992
Transmission, Distribution, and
Customer Service of Entergy
Services
Director of System Fuels 1979-1992
Director of Entergy Enterprises 1984-1991
Jerry D. Jackson 51 Executive Vice President - 1994-Present
Marketing and External Affairs of
Entergy Corporation
Executive Vice President - 1995-Present
Marketing and External Affairs of
AP&L, GSU, LP&L, MP&L, and NOPSI
Executive Vice President - 1994-Present
Marketing and External Affairs of
Entergy Services
Director of AP&L, LP&L, MP&L, and 1992-Present
NOPSI
Director of GSU 1994-Present
Director of Entergy Services 1990-Present
President and Chief Administrative 1992-1994
Officer of Entergy Services
President of Entergy Enterprises 1991-1992
Executive Vice President - Finance 1990-1994
and External Affairs of Entergy
Corporation
Executive Vice President - Finance 1992-1994
and External Affairs and Secretary
of AP&L, LP&L, MP&L, and NOPSI
Executive Vice President - Finance 1993-1994
and External Affairs of GSU
Executive Vice President - Finance 1990-1992
and External Affairs of Entergy
Services
Secretary of Entergy Corporation 1991-1994
Secretary of GSU 1994-1995
Director of System Energy 1993-1995
Director of Entergy Power and 1990-1992
Entergy Enterprises
Donald C. Hintz 53 Executive Vice President and Chief 1994-Present
Nuclear Officer of Entergy
Corporation
Executive Vice President - Nuclear 1994-Present
of AP&L, GSU, and LP&L
Chief Executive Officer and 1992-Present
President of System Energy and
Entergy Operations
Director of AP&L, LP&L, MP&L, 1992-Present
System Energy, System Fuels, and
Entergy Services
Director of GSU 1993-Present
Director of Entergy Operations 1990-Present
Director of GSG&T, Prudential Oil & 1994-Present
Gas, Southern Gulf Railway, and
Varibus Corporation
Senior Vice President and Chief 1993-1994
Nuclear Officer of Entergy
Corporation
Senior Vice President - Nuclear of 1990-1994
AP&L
Senior Vice President - Nuclear of 1993-1994
GSU
Senior Vice President - Nuclear of 1992-1994
LP&L
President of Entergy Operations 1992-1992
Director of NOPSI 1992-1994
Chief Operating Officer and 1990-1992
Executive Vice President of
Entergy Operations
Group Vice President - Nuclear of 1990-1992
LP&L
Gerald D. McInvale 52 Executive Vice President and Chief 1995-Present
Financial Officer of Entergy
Corporation, Entergy Services,
AP&L, GSU, LP&L, MP&L, NOPSI,
System Energy, Entergy
Enterprises, Entergy Operations,
System Fuels Inc., Entergy Systems
and Services, GSG&T, Prudential
Oil & Gas, Southern Gulf Railway,
and Varibus Corporation
Senior Vice President, Treasurer, 1994-Present
and Director of Entergy Pakistan,
Ltd. and Entergy Power Asia, Ltd.
Senior Vice President, Treasurer, 1993-Present
and Director of Entergy Power
Development Corporation and
Entergy-Richmond Power Corporation
Senior Vice President, Treasurer, 1995-Present
and Director of Entergy EDEGEL I,
Inc., EP EDEGEL, Inc., Entergy
Power Development International
Corporation, Entergy Power Holding
I, Ltd., Entergy Power Holding II,
Ltd., Entergy Power Marketing
Corporation, Entergy Power
Operations Corporation, Entergy
Power Operations Holdings, Ltd.,
Entergy Power Operations Pakistan
LDC, Entergy Victoria LDC, Entergy
Victoria Holdings LDC, Entergy
Yacyreta I, Inc., EPG Cayman
Holding I, EPG Cayman Holding II
Vice President, Treasurer, and 1993-Present
Director of Entergy Power
Treasurer of Entergy Enterprises 1992-Present
Director of AP&L, GSU, LP&L, MP&L, 1995-Present
NOPSI, Entergy Services, System
Energy, Entergy Operations, GSG&T,
Prudential Oil & Gas, Southern
Gulf Railway, and Varibus
Corporation
Director of System Fuels 1992-Present
Director of Entergy Systems and 1993-Present
Service, Inc.
Chairman of the Board of Entergy 1994-1995
Systems and Service, Inc.
Senior Vice President and Chief 1991-1995
Financial Officer of Entergy
Corporation, AP&L, LP&L, MP&L,
NOPSI, System Energy, Entergy
Operations, Entergy Services, and
Entergy Enterprises
Senior Vice President and Chief 1993-1995
Financial Officer of GSU
Senior Vice President and Chief 1994-1995
Financial Officer of System Fuels
Director and Acting Chief Operating 1994-1995
Officer of Entergy Enterprises
President - Executive Information 1990-1991
Strategies, (consulting firm),
Dallas, Texas
Michael G. Thompson 55 Senior Vice President and General 1992-Present
Counsel of Entergy Corporation and
Entergy Services
Senior Vice President and General 1995-Present
Counsel of AP&L, GSU, LP&L, MP&L,
and NOPSI
Senior Vice President-Law and 1992-Present
Secretary of Entergy Enterprises
Senior Vice President, Secretary, 1994-Present
and Director of Entergy Pakistan,
Ltd. and Entergy Power Asia, Ltd.
Senior Vice President, Secretary, 1994-Present
and Director of Entergy EDEGEL I,
Inc., Entergy Power Marketing
Corporation, Entergy Power
Operations Holding Ltd., Entergy
Yacyreta I, Inc., and
EP EDEGEL, Inc.
Senior Vice President, Secretary, 1995-Present
and Director of Entergy Power
Development International
Corporation, Entergy Power Holding
I, Ltd., Entergy Power Holding II,
Ltd., Entergy Power Operations
Corporation, Entergy Power
Operations Pakistan LDC, Entergy
Victoria LDC, Entergy Victoria
Holdings LDC, EPG Cayman Holding
I, and EPG Cayman Holding II
Senior Vice President, Secretary, 1992-Present
and Director of Entergy Power
Development Corporation and
Entergy-Richmond Power Corporation
Vice President, Secretary, and 1994-Present
Director of Entergy Power
Vice President and Secretary of 1993-Present
Entergy Systems and Service, Inc.
Secretary of Entergy Corporation 1994-Present
Secretary of AP&L, GSU, LP&L, MP&L, 1995-Present
and NOPSI
Director of Entergy Systems and 1992-Present
Service, Inc.
Senior Vice President, Chief Legal 1993-1994
Officer, Director and Secretary of
Entergy Power
Assistant Secretary of Entergy 1993-1994
Corporation
Senior Partner of Friday, Eldredge 1987-1992
& Clark (law firm)
S. M. Henry Brown, Jr. 57 Vice President - Federal 1989-Present
Governmental Affairs of Entergy
Corporation and Entergy Services
Charles L. Kelly 59 Vice President - Corporate 1992-Present
Communications and Public
Relations of Entergy Corporation
Vice President - Corporate 1991-Present
Communications and Public
Relations of Entergy Services
Vice President - Corporate 1981-1991
Communications of AP&L
William J. Regan, Jr. 49 Vice President and Treasurer of 1995-Present
Entergy Corporation, AP&L, GSU,
LP&L, MP&L, NOPSI, System Energy,
Entergy Operations, Entergy
Services, System Fuels Inc.,
GSG&T, Prudential Oil & Gas,
Southern Gulf Railway, and Varibus
Corporation
Assistant Secretary of System Fuels 1995-Present
Inc., GSG&T, Prudential Oil & Gas,
Southern Gulf Railway, and Varibus
Corporation
Senior Vice President and Corporate 1989-1995
Treasurer of United Services
Automobile Association
Louis E. Buck, Jr. 47 Vice President and Chief Accounting 1995-Present
Officer of Entergy Corporation,
AP&L, GSU, LP&L, MP&L, NOPSI,
System Energy, Entergy Operations,
and Entergy Services
Assistant Secretary of AP&L, GSU, 1995-Present
LP&L, MP&L, NOPSI, Entergy
Operations, and Entergy Services
Vice President and Chief Financial 1992-1995
Officer of North Carolina Electric
Membership Corporation
Manager of Finance of Texas 1988-1992
Utilities Services (public
utility)
ARKANSAS POWER & LIGHT COMPANY
Directors
Michael B. Bemis(b) 48 Executive Vice President - Customer 1992-Present
Service and Director of AP&L,
LP&L, and MP&L
Executive Vice President - Customer 1993-Present
Service of GSU
Executive Vice President - Customer 1992-Present
Service of NOPSI and Entergy
Services
Director of GSU 1994-Present
Director of System Fuels 1992-Present
Director of Varibus Corporation, 1994-Present
Prudential Oil & Gas, Inc., GSG&T,
Inc., and Southern Gulf Railway
Company
President and Chief Operating 1992-1992
Officer of LP&L and NOPSI
President and Chief Operating 1989-1991
Officer of MP&L
Director of NOPSI 1992-1994
Secretary of MP&L 1991-1991
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
R. Drake Keith 60 President and Director of AP&L 1989-Present
Chief Operating Officer of AP&L 1989-1992
Secretary of AP&L 1991-1992
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
R. Drake Keith 60 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Frank F. Gallaher 50 Chairman of the Board of System 1992-Present
Fuels
Chairman of the Board and Director 1993-Present
of Varibus Corporation, Prudential
Oil & Gas, Inc., GSG&T, Inc., and
Southern Gulf Railway Company
President of GSU 1994-Present
Executive Vice President - Fossil 1993-Present
Operations of AP&L, LP&L, MP&L,
NOPSI, and Entergy Services
Director of GSU 1993-Present
Director of Entergy Services and 1992-Present
System Fuels
Senior Vice President - Fossil 1992-1993
Operations of AP&L, LP&L, MP&L,
NOPSI, and Entergy Services
Vice President - System Planning of 1990-1992
Entergy Services
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael G. Thompson 55 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael R. Niggli 46 Senior Vice President - Marketing 1993-Present
of AP&L, GSU, LP&L, MP&L, NOPSI,
and Entergy Services
Vice President - Customer Services 1993-1993
of LP&L, NOPSI, and Entergy
Services
Vice President - Strategic Planning 1990-1992
of Entergy Services
Vice President and Director of 1991-1992
Entergy Enterprises
Cecil L. Alexander 60 Vice President - Governmental 1991-Present
Affairs of AP&L
Vice President - Public Affairs of 1989-1991
AP&L
Richard J. Landy 50 Senior Vice President and Chief 1995-Present
Administrative Officer of AP&L,
EOI, Entergy Services, GSU, LP&L,
MP&L, and NOPSI
Vice President - Human Resources 1991-Present
and Administration of AP&L, LP&L,
MP&L, NOPSI, Entergy Services, and
EOI
Vice President - Human Resources 1993-Present
and Administration of GSU
Vice President - Human Resources 1990-1991
and Administration of Entergy
Operations
James S. Pilgrim 60 Vice President - Customer Service 1994-Present
of AP&L
Director, Central Region, TDCS 1993-1994
Customer Service
Central Division Manager of MP&L 1991-1993
Northern Division Manager of MP&L 1988-1991
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
C. Hiram Walters 59 Vice President - Customer Service 1993-Present
of AP&L
Vice President - Customer Service 1994-Present
of LP&L
Vice President - Customer Service, 1993-Present
Central Region of Entergy Services
Senior Vice President - Customer 1991-1992
Service of Entergy Services
Vice President - Customer Service 1984-1991
of MP&L
GULF STATES UTILITIES COMPANY
Directors
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Frank F. Gallaher 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Frank F. Gallaher 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael G. Thompson 55 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael R. Niggli 46 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Richard J. Landy 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
William E. Colston 60 Vice President - Customer Service 1994-Present
of GSU
Vice President - Customer Service 1993-Present
of LP&L
Vice President - Customer Service 1993-Present
of Southern Region of Entergy
Services
Vice President - Division Manager 1988-1991
of LP&L
Regional Director of LP&L 1992-1993
Calvin J. Hebert 61 Vice President - Customer Service 1993-Present
of GSU
Senior Vice President - Division 1992-1993
Operations of GSU
Senior Vice President - External 1986-1992
Affairs of GSU
Karen Johnson 51 Vice President - Governmental 1994-Present
Affairs of GSU - Texas
Executive Director of State Bar of 1990-1994
Texas (state agency)
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
LOUISIANA POWER & LIGHT COMPANY
Directors
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
John J. Cordaro 62 President and Director of LP&L and 1992-Present
NOPSI
Group Vice President - External 1989-1992
Affairs of LP&L and NOPSI
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
John J. Cordaro 62 See the information under the LP&L
Directors Section above,
incorporated herein by reference.
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Frank F. Gallaher 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael G. Thompson 55 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael R. Niggli 46 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Richard C. Guthrie 53 Vice President - Governmental 1992-Present
Affairs of LP&L and NOPSI
Vice President - Public Affairs of 1986-1992
LP&L and NOPSI
Richard J. Landy 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
James D. Bruno 56 Vice President - Customer Service 1994-Present
of LP&L and NOPSI
Vice President - Metro Region of 1993-Present
Entergy Services
Vice President - Division Manager - 1988-1991
Orleans Division of Entergy
Services
Region Director - Metro Region of 1991-1993
Entergy Services
William E. Colston 60 See the information under the GSU
Officers Section above,
incorporated herein by reference.
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
C. Hiram Walters 59 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
MISSISSIPPI POWER & LIGHT COMPANY
Directors
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Donald E. Meiners(c) 60 President and Director of MP&L 1992-Present
President and Chief Operating 1990-1991
Officer of LP&L and NOPSI
Chief Operating Officer and 1992-1992
Secretary of MP&L
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Donald E. Meiners 60 See the information under the MP&L
Directors Section above,
incorporated herein by reference.
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Frank F. Gallaher 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael G. Thompson 55 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael R. Niggli 46 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Bill F. Cossar 57 Vice President - Governmental 1987-Present
Affairs of MP&L
Johnny D. Ervin 46 Vice President - Customer Service 1991-Present
of MP&L
Vice President - Division Manager 1989-1991
of LP&L
Vice President - Marketing of LP&L 1988-1991
and NOPSI
Director of Entergy Enterprises 1991-1992
Richard J. Landy 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
NEW ORLEANS PUBLIC SERVICE INC.
Directors
John J. Cordaro 62 See the information under the LP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
John J. Cordaro 62 See the information under the LP&L
Directors Section above,
incorporated herein by reference.
Michael B. Bemis 48 See the information under the AP&L
Directors Section above,
incorporated herein by reference.
Jerry D. Jackson 51 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Frank F. Gallaher 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael G. Thompson 55 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Michael R. Niggli 46 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
Richard C. Guthrie 53 See the information under the LP&L
Officers Section above,
incorporated herein by reference.
Daniel F. Packer 48 Vice President - Regulatory and 1994-Present
Governmental Affairs of NOPSI
General Manager - Plant Operations 1991-1994
at Waterford 3
Manager - Operations and 1990-1991
Maintenance at Waterford 3
Richard J. Landy 50 See the information under the AP&L
Officers Section above,
incorporated herein by reference.
James D. Bruno 56 See the information under the LP&L
Officers Section above,
incorporated herein by reference.
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
SYSTEM ENERGY RESOURCES, INC.
Directors
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Jerry L. Maulden 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Officers
Edwin Lupberger 59 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Donald C. Hintz 53 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Gerald D. McInvale 52 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
William J. Regan, Jr. 49 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Louis E. Buck, Jr. 47 See the information under the
Entergy Corporation Officers
Section above, incorporated herein
by reference.
Joseph L. Blount 49 Secretary of System Energy and 1991-Present
Entergy Operations
Vice President Legal and External 1990-1993
Affairs of Entergy Operations
Assistant Secretary for System 1987-1991
Energy
Assistant Secretary for Entergy 1990-1991
Operations
</TABLE>
(a) Mr. Lupberger is a director of First Commerce Corporation, New
Orleans, LA, International Shipholding Corporation, New Orleans,
LA, and First National Bank of Commerce, New Orleans, LA.
(b) Mr. Bemis is a director of Deposit Guaranty National Bank,
Jackson, MS and Deposit Guaranty Corporation, Jackson, MS.
(c) Mr. Meiners is a director of Trustmark National Bank, Jackson,
MS, and Trustmark Corporation, Jackson, MS.
Each director and officer of the applicable System company is
elected yearly to serve until the first Board Meeting following the
Annual Meeting of Stockholders or until a successor is elected and
qualified. Annual meetings are currently expected to be held as
follows:
Entergy Corporation - May 17, 1996
AP&L - May 13, 1996
GSU - May 13, 1996
LP&L - May 13, 1996
MP&L - May 13, 1996
NOPSI - May 13, 1996
System Energy - May 13, 1996
Directorships shown above are generally limited to entities
subject to Section 12 or 15(d) of the Securities and Exchange Act of
1934 or to the Investment Company Act of 1940.
Section 16(a) of the Exchange Act and Section 17(a) of the
Public Utility Holding Company Act of 1935, as amended, require the
Corporation's officers, directors and persons who own more than 10%
of a registered class of the Corporation's equity securities to file
reports of ownership and changes in ownership concerning the
securities of the Corporation and its subsidiaries with the SEC and
to furnish the Corporation with copies of all Section 16(a) and 17(a)
forms they file. Terry L. Ogletree, an officer of Entergy
Enterprises, Inc., filed a Form 3 in March of 1995, which
inadvertently failed to report ownership of 5,000 restricted shares
of the Corporation's stock. This has now been correctly reported.
Item 11. Executive Compensation
ENTERGY CORPORATION
Information called for by this item concerning the directors and
officers of Entergy Corporation and the Personnel Committee of
Entergy Corporation's Board of Directors is set forth under the
headings "Executive Compensation" and "Personnel Committee Interlocks
and Insider Participation" contained in the Proxy Statement of
Entergy Corporation to be filed in connection with its Annual Meeting
of Stockholders to be held on May 17, 1996, which information is
incorporated herein by reference.
AP&L, GSU, LP&L, MP&L, NOPSI, AND SYSTEM ENERGY
Summary Compensation Table
The following table includes the Chief Executive Officers and
the four other most highly compensated executive officers in office
as of December 31, 1995 at AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy. This determination was based on total annual base salary and
bonuses (including bonuses of an extraordinary and nonrecurring
nature) from all System sources earned by each officer during the
year 1995. See Item 10, "Directors and Executive Officers of the
Registrants," incorporated herein by reference, for information on
the principal positions of the executive officers named in the table
below.
AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy
As shown in Item 10, most executive officers named below are
employed by several System companies. Because it would be
impracticable to allocate such officers' salaries among the various
companies, the table below includes aggregate compensation paid by
all System companies.
<TABLE>
<CAPTION>
Long-Term Compensation
Annual Compensation Awards Payouts
Other Restricted Securities (b) (c)
(a) Annual Stock Underlying LTIP All Other
Name Year Salary Bonus Compensation Awards Options Payouts Compensation
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael B. Bemis 1995 $290,000 $216,909 $22,844 (d) 27,500 shares $294,282 $27,607
1994 288,846 76,923 32,940 (d) 2,500 28,275 22,982
1993 258,538 161,142 62,372 (d) 2,500 50,125 74,619
Joseph L. Blount 1995 $119,185 $43,645 $15,842 (d) 0 shares $ 0 $15,705
1994 115,171 17,064 9,339 (d) 0 0 12,416
1993 109,090 0 4,416 (d) 0 0 15,926
Donald C. Hintz* 1995 $325,000 $265,049 $13,394 (d) 30,000 shares $409,414 $23,569
1994 320,769 142,749 52,389 (d) 5,000 48,379 23,056
1993 265,386 166,560 48,548 (d) 5,000 85,774 24,462
Jerry D. Jackson 1995 $325,000 $256,838 $43,054 (d) 30,000 shares $422,438 $24,794
1994 323,711 106,155 29,598 (d) 5,000 56,550 23,370
1993 288,559 217,287 36,166 (d) 6,719 100,250 25,961
Edwin Lupberger** 1995 $700,000 $568,400 $29,624 (d) 60,000 shares $781,337 $33,142
1994 681,539 218,789 39,961 (d) 10,000 139,525 29,457
1993 542,077 437,610 20,327 (d) 13,438 248,313 32,957
Jerry L. Maulden 1995 $435,000 $353,220 $26,248 (d) 30,000 shares $422,438 $28,504
1994 426,134 135,962 63,994 (d) 5,000 56,550 25,690
1993 385,000 286,985 84,655 (d) 5,000 100,250 25,639
Gerald D. McInvale 1995 $255,481 $186,739 $12,525 (d) 27,500 shares $294,282 $21,263
1994 244,165 66,227 14,146 (d) 2,500 28,275 19,581
1993 221,696 141,811 48,805 (d) 2,500 50,125 22,667
William J. Regan, Jr. 1995 $120,577 $54,727 $21,141 (d) 0 $ 0 $14,633
</TABLE>
* Chief Executive Officer of System Energy.
** Chief Executive Officer of AP&L, GSU, LP&L, MP&L, and NOPSI.
(a) Includes bonuses earned pursuant to the Annual Incentive Plan.
(b) Amounts include the value of restricted shares that vested in
1995, 1994, and 1993 (see note (d) below) under Entergy's Equity
Ownership Plan.
(c) Includes the following:
(1) 1995 employer payments for Executive Medical Plan premiums
as follows: Mr. Bemis $3,019; Mr. Blount $3,019; Mr. Hintz $3,019;
Mr. Jackson $3,019; Mr. Lupberger $3,019; Mr. Maulden $3,019; Mr.
McInvale $3,019; Mr. Regan $2,013.
(2) 1995 benefit accruals under the Defined Contribution
Restoration Plan as follows: Mr. Bemis $4,200; Mr. Hintz $5,250;
Mr. Jackson $5,250; Mr. Lupberger $16,500; Mr. Maulden $8,550; Mr.
McInvale $3,164.
(3) 1995 employer contributions to the System Savings Plan as
follows: Mr. Bemis $4,500; Mr. Blount $3,576; Mr. Hintz $4,500; Mr.
Jackson $4,500; Mr. Lupberger $4,500; Mr. Maulden $4,500; Mr.
McInvale $4,500; Mr. Regan $877.
(4) 1995 reimbursements under the Executive Financial
Counseling Program as follows: Mr. Bemis $2,625; Mr. Jackson
$1,225; Mr. Lupberger $3,100; Mr. Maulden $2,715; Mr. McInvale $680.
(5) 1995 payments for personal use under the Private Ownership
Vehicle Plan as follows: Mr. Bemis $9,900; Mr. Blount $7,200; Mr.
Hintz $10,800; Mr. Jackson $10,800; Mr. Lupberger $6,023; Mr.
Maulden $9,720; Mr. McInvale $9,900; Mr. Regan $4,800.
(6) 1995 earnings under the Entergy Stock Investment Plan as
follows: Mr. Bemis $3,363; Mr. Blount $1,910.
(7) 1995 reimbursements for moving expenses paid to Mr. Regan
in the amount of $6,943.
(d) There were no restricted stock awards in 1995 under the Equity
Ownership Plan. At December 31, 1995, the number and value of the
aggregate restricted stock holdings were as follows: Mr. Bemis: 4,000
shares, $117,000; Mr. Hintz: 5,429 shares, $158,798; Mr. Jackson:
5,500 shares, $160,875; Mr. Lupberger: 10,900 shares, $318,825; Mr.
Maulden: 5,500 shares, $160,875; and Mr. McInvale: 4,000 shares,
$117,000. Accumulated dividends are paid on restricted stock when
vested. The value of stock for which restrictions were lifted in
1995, and the applicable portion of accumulated cash dividends, are
reported in the LTIP Payouts column in the above table. The value of
restricted stock awards as of December 31, 1995 are determined by
multiplying the total number of shares awarded by the closing market
price of Entergy Corporation common stock on the New York Stock
Exchange Composite Transactions on December 29, 1995 ($29.25 per
share).
Option Grants in 1995
The following table summarizes option grants during 1995 to the
executive officers named in the Summary Compensation Table above.
The absence, in the table below, of any named officer indicates that
no options were granted to such officer.
AP&L, GSU, LP&L, MP&L, NOPSI, and System Entergy
<TABLE>
<CAPTION>
Individual Grants Potential Realizable
% of Total
Options Value
Number of Granted at Assumed Annual
Securities to Exercise Rates of Stock
Underlying Employees Price Price Appreciation
Options in (per Expiration for Option Term(c)
Name Granted 1995 share) Date 5% 10%
<S> <C> <C> <C> <C> <C> <C>
Michael B. Bemis 2,500 (a) 0.8% $23.375 (a) 1/26/05 $ 36,751 $ 93,134
25,000 (b) 7.9% 20.875 (b) 3/31/05 328,204 831,734
Donald C. Hintz 5,000 (a) 1.6% 23.375 (a) 1/26/05 73,502 186,269
25,000 (b) 7.9% 20.875 (b) 3/31/05 328,204 831,734
Jerry D. Jackson 5,000 (a) 1.6% 23.375 (a) 1/26/05 0 0
25,000 (b) 7.9% 20.875 (b) 3/31/05 328,204 831,734
Edwin Lupberger 10,000 (a) 3.2% 23.375 (a) 1/26/05 147,004 372,537
50,000 (b) 15.9% 20.875 (b) 3/31/05 656,409 1,663,469
Jerry L. Maulden 5,000 (a) 1.6% 23.375 (a) 1/26/05 73,502 186,269
25,000 (b) 7.9% 20.875 (b) 3/31/05 328,204 831,734
Gerald D. McInvale 2,500 (a) 0.8% 23.375 (a) 1/26/05 36,751 93,134
25,000 (b) 7.9% 20.875 (b) 3/31/05 328,204 831,734
</TABLE>
(a) Options were granted on January 26, 1995, pursuant to the Equity
Ownership Plan. All options granted on this date have an exercise
price equal to the closing price of Entergy Corporation common stock
on the New York Stock Exchange Composite Transactions on
January 26, 1995. These options became exercisable on July 26, 1995.
(b) Options were granted on March 31, 1995, pursuant to the Equity
Ownership Plan. All options granted on this date have an exercise
price equal to the closing price of Entergy Corporation common stock
on the New York Stock Exchange Composite Transactions on
March 31, 1995. These options will become exercisable on
March 31, 1998.
(c) Calculation based on the market price of the underlying
securities over a ten-year period assuming annual compounding. The
column presents estimates of potential values based on simple
mathematical assumptions. The actual value, if any, an executive
officer may realize is dependent upon the market price on the date of
option exercise.
Aggregated Option Exercises in 1995 and December 31, 1995 Option
Values
The following table summarizes the number and value of options
exercised during 1995, as well as the number and value of unexercised
options, as of December 31, 1995, held by the executive officers
named in the Summary Compensation Table above.
<TABLE>
<CAPTION>
Number of
Securities Underlying Value of Unexercised
Unexercised Options In-the-Money Options
Shares Acquired Value as of December 31, 1995 as of December 31, 1995(b)
Name on Exercise Realized(a) Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Michael B. Bemis 0 $ 0 10,000 25,000 58,750 $209,375
Donald C. Hintz 0 0 17,500 25,000 29,375 209,375
Jerry D. Jackson 5,000 21,817 14,411 25,000 0 209,375
Edwin Lupberger 0 0 38,824 50,000 58,750 418,750
Jerry L. Maulden 0 0 20,000 25,000 29,375 209,375
Gerald D. McInvale 0 0 10,000 25,000 14,688 209,375
</TABLE>
(a) Based on the difference between the closing price of the
Corporation's Common Stock on the New York Stock Exchange Composite
Transactions on the exercise date of November 17, 1995, and the
option exercise price.
(b) Based on the difference between the closing price of the
Corporation's Common Stock on the New York Stock Exchange Composite
Transactions on December 29, 1995, and the option exercise price.
Pension Plan Tables
AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy
Retirement Income Plan Table
Annual
Covered Years of Service
Compensation 15 20 25 30 35
$100,000 $22,500 $30,000 $37,500 $45,000 $ 52,000
200,000 45,500 60,000 75,000 90,000 105,000
300,000 67,500 90,000 112,500 135,000 157,500
400,000 90,000 120,000 150,000 180,000 210,000
500,000 112,500 150,000 187,500 225,000 262,500
850,000 191,250 255,000 318,750 382,500 446,250
All of the named officers of AP&L, GSU, LP&L, MP&L, NOPSI and
System Energy participate in a Retirement Income Plan (a defined
benefit plan) that provides a benefit for employees at retirement
from the System based upon (1) generally all years of service
beginning at age 21 through termination, with a forty-year maximum,
multiplied by (2) 1.5%, multiplied by (3) the final average
compensation. Final average compensation is based on the highest
consecutive 60 months of covered compensation in the last 120 months
of service. The normal form of benefit for a single employee is a
lifetime annuity and for a married employee is a 50% joint and
survivor annuity. Other actuarially equivalent options are available
to each retiree. Retirement benefits are not subject to any
deduction for Social Security or other offset amounts. The amount of
the named executive officers' annual compensation covered by the plan
as of December 31, 1995, is represented by the salary column in the
Summary Compensation Table above.
The maximum benefit under each Retirement Income Plan is limited
by Sections 401 and 415 of the Internal Revenue Code of 1986, as
amended; however, AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy
have elected to participate in the Pension Equalization Plan
sponsored by Entergy Corporation. Under this plan, certain
executives, including the named executive officers, would receive an
amount equal to the benefit payable under the Retirement Income
Plans, without regard to the limitations, less the amount actually
payable under the Retirement Income Plans.
Effective January 1, 1995, the System Companies Retirement
Income Plans were amended to transfer assets and related liabilities
to a single Entergy Corporation Retirement Plan for all non-
bargaining unit employees. Each Retirement Income Plan (except GSU)
was amended effective February 1, 1991, to provide a minimum accrued
benefit as of that date to any employee who was vested as of that
date. For purposes of calculating such minimum accrued benefit, each
eligible employee was deemed to have had an additional five years of
service and age as of that date. The additional years of age did not
count toward eligibility for early retirement, but served only to
reduce the early retirement discount factor for those employees who
were at least age 50 as of that date.
The credited years of service under the Retirement Income Plan
(without giving effect to the five additional years of service
credited pursuant to the February 1, 1991 amendment as discussed
above) as of December 31, 1995, for the following executive officers
named in the Summary Compensation Table above were: Mr. Bemis 13;
Mr. Blount 11; and Mr. Maulden 30.
The credited years of service under the respective Retirement
Income Plan, as amended, as of December 31, 1995 for the following
executive officers named in the Summary Compensation Table, as a
result of entering into supplemental retirement agreements, were as
follows: Mr. Hintz 24; Mr. Jackson 16; Mr. Lupberger 32; and
Mr. McInvale 23.
In addition to the Retirement Income Plan discussed above, AP&L,
LP&L, MP&L, NOPSI, and System Energy participate in the Supplemental
Retirement Plan of Entergy Corporation and Subsidiaries (SRP) and the
Post-Retirement Plan of Entergy Corporation and Subsidiaries (PRP).
Participation is limited to one of these two plans and is at the
invitation of AP&L, LP&L, MP&L, NOPSI, and System Energy. The
participant may receive from the appropriate System company a monthly
benefit payment not in excess of .025 (under the SRP) or .0333 (under
the PRP) times the participant's average basic annual salary (as
defined in the plans) for a maximum of 120 months. Mr. Hintz has
entered into a SRP participation contract, and all of the other
executive officers of AP&L, LP&L, MP&L, NOPSI, and System Energy
named in the Summary Compensation Table (except for Mr. Blount,
Mr. McInvale and Mr. Regan) have entered into PRP participation
contracts. Current estimates indicate that the annual payments to a
named executive officer under the above plans would be less than the
payments to that officer under the System Executive Retirement Plan.
System Executive Retirement Plan Table (1)
Annual
Covered Years of Service
Compensation 15 20 25 30+
$ 200,000 $ 90,000 $100,000 $110,000 $120,000
300,000 135,000 150,000 165,000 180,000
400,000 180,000 200,000 220,000 240,000
500,000 225,000 250,000 275,000 300,000
600,000 270,000 300,000 330,000 360,000
700,000 315,000 350,000 385,000 420,000
1,000,000 450,000 500,000 550,000 600,000
___________
(1)Benefits shown are based on a target replacement ratio of 50% based
on the years of service and covered compensation shown. The benefits
for 10, 15, and 20 or more years of service at the 45% and 55%
replacement levels would decrease (in the case of 45%) or increase (in
the case of 55%) by the following percentages: 3.0%, 4.5%, and 5.0%,
respectively.
In 1993, Entergy Corporation adopted the System Executive
Retirement Plan (SERP). AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy are participating employers in the SERP. The SERP is an
unfunded defined benefit plan offered at retirement to certain senior
executives, which would currently include all the executive officers
(except Mr. Blount) named in the Summary Compensation Table above.
Participating executives choose, at retirement, between the retirement
benefits paid under provisions of the SERP or those payable under the
executive retirement benefit plans discussed above. Covered pay under
the SERP includes final annual base salary (see the Summary
Compensation Table above, for the base salary covered by the SERP as
of December 31, 1995) plus the Target Incentive Award (i.e., a
percentage of final annual base salary) for the participant in effect
at retirement. Benefits paid under the SERP are calculated by
multiplying the covered pay times target pay replacement ratios (45%,
50%, or 55%, dependent on job rating at retirement) that are attained,
according to plan design, at 20 years of credited service. The target
ratios are increased by 1% for each year of service over 20 years, up
to a maximum of 30 years of service. In accordance with the SERP
formula, the target ratios are reduced for each year of service below
20 years. The credited years of service under this plan are identical
to the years of service for named executive officers (other than Mr.
Bemis, Mr. Jackson, and Mr. McInvale) disclosed above in the "Pension
Plan Tables-Retirement Income Plan Table" section. Mr. Bemis, Mr.
Jackson, and Mr. McInvale have 23 years, 22 years, and 14 years,
respectively, of credited service under this plan.
The normal form of benefit for a single employee is a lifetime
annuity and for a married employee is a 50% joint and survivor
annuity. All SERP payments are guaranteed for ten years. Other
actuarially equivalent options are available to each retiree. SERP
benefits are offset by any and all defined benefit plan payments from
the System and from prior employers. SERP benefits are not subject to
Social Security offsets.
Eligibility for and receipt of benefits under any of the
executive plans described above are contingent upon several factors.
The participant must agree that, without the specific consent of the
System company for which such participant was last employed, he may
take no employment after retirement with any entity that is in
competition with, or similar in nature to, AP&L, GSU, LP&L, MP&L,
NOPSI, and System Energy or any affiliate thereof. Eligibility for
benefits is forfeitable for various reasons, including violation of an
agreement with AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy,
resignation of employment, or termination for cause.
In addition to the non-bargaining unit employees Retirement
Income Plan discussed above, GSU provides, among other benefits to
officers, an Executive Income Security Plan for key managerial
personnel. The plan provides participants with certain retirement,
disability, termination, and survivors' benefits. To the extent that
such benefits are not funded by the employee benefit plans of GSU or
by vested benefits payable by the participants' former employers, GSU
is obligated to make supplemental payments to participants or their
survivors. The plan provides that upon the death or disability of a
participant during his employment, he or his designated survivors will
receive (i) during the first year following his death or disability an
amount not to exceed his annual base salary, and (ii) thereafter for a
number of years until the participant attains or would have attained
age 65, but not less than nine years, an amount equal to one-half of
the participant's annual base salary. The plan also provides
supplemental retirement benefits for life for participants retiring
after reaching age 65 equal to 1/2 of the participant's average final
compensation rate, with 1/2 of such benefit upon the death of the
participant being payable to a surviving spouse for life.
GSU amended and restated the plan effective March 1, 1991, to
provide such benefits for life upon termination of employment of a
participating officer or key managerial employee without cause (as
defined in the plan) or if the participant separates from employment
for good reason (as defined in the plan), with 1/2 of such benefits to
be payable to a surviving spouse for life. Further, the plan was
amended to provide medical benefits for a participant and his family
when the participant separates from service. These medical benefits
generally continue until the participant is eligible to receive
medical benefits from a subsequent employer; but in the case of a
participant who is over 50 at the time of separation and was
participating in the plan on March 1, 1991, medical benefits continue
for life. By virtue of the 1991 amendment and restatement, benefits
for a participant under such plan cannot be modified once he becomes
eligible to participate in the plan.
Compensation of Directors
AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy currently have
no non-employee directors, and none of the current directors is
compensated for his responsibilities as director.
Retired non-employee directors of AP&L, LP&L, MP&L, and NOPSI
with a minimum of five years of service on the respective Boards of
Directors are paid $200 a month for a term of years corresponding to
the number of years of active service as directors. Retired non-
employee directors with over ten years of service receive a lifetime
benefit of $200 a month. Years of service as an advisory director are
included in calculating this benefit. System Energy has no retired
non-employee directors.
Retired non-employee directors of GSU receive retirement benefits
under a plan in which all directors who served continuously for a
period of years will receive a percentage of their retainer fee in
effect at the time of their retirement for life. The retirement
benefit is 30 percent of the retainer fee for service of not less than
five nor more than nine years, 40 percent for service of not less than
ten nor more than fourteen years, and 50 percent for fifteen or more
years of service. For those directors who retired prior to the
retirement age, their benefits will be reduced. The plan also
provides disability retirement and optional hospital and medical
coverage if the director has served at least five years prior to the
disability. The retired director pays one-third of the premium for
such optional hospital and medical coverage and GSU pays the remaining
two-thirds. Years of service as an advisory director are included in
calculating these benefits.
Employment Contracts and Termination of Employment and Change-in-
Control Arrangements
GSU
On January 18, 1991, GSU established an Executive Continuity Plan
for elected and appointed officers providing for severance benefits
equal to 2.99 times the officer's annual compensation upon termination
of employment for reasons other than cause or upon a resignation of
employment for good reason within two years after a change in control
of GSU. Benefits are prorated if the officer is within three years of
normal retirement age (65) at termination of employment. The plan
further provides for continued participation in medical, dental, and
life insurance programs for three years following termination unless
such benefits are available from a subsequent employer. The plan
provides for outplacement assistance to aid a terminated officer in
securing another position. Upon consummation of the Merger on
December 31, 1993, GSU made a one time contribution of $16,330,693 to
a trust equivalent to the then present value of the maximum benefits
which might be payable under the plan. As of December 31, 1995, the
balance in the trust had been reduced to $7,678,628. If and to the
extent outstanding benefits are not paid to the participants, the
balance in the trust will be returned to GSU.
As a result of the Merger, GSU is obligated to pay benefits under
the Executive Income Security Plan to those persons who were
participants at the time of the Merger and who later terminated their
employment under circumstances described in the plan. For additional
description of the benefits under the Executive Income Security Plan,
see the "Pension Plan Tables-System Executive Retirement Plan Table"
section noted above.
Personnel Committee Interlocks and Insider Participation
The compensation of AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy executive officers was set by the Personnel Committee of
Entergy Corporation's Board of Directors for 1995. No officers or
employees of such companies participated in deliberations concerning
compensation during 1995. The Personnel Committee of Entergy
Corporation's Board of Directors is set forth under the heading
"Report of Personnel Committee on Executive Compensation" contained in
the Proxy Statement of Entergy Corporation to be filed in connection
with its Annual Meeting of Stockholders to be held May 17, 1996, and
is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
Entergy Corporation owns 100% of the outstanding common stock of
registrants AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy. The
information with respect to persons known by Entergy Corporation to be
beneficial owners of more than 5% of Entergy Corporation's common
stock is included under the heading "Voting Securities Outstanding" in
the Proxy Statement of Entergy Corporation to be filed in connection
with its Annual Meeting of Stockholders to be held May 17, 1996, which
information is incorporated herein by reference. The registrants know
of no contractual arrangements that may, at a subsequent date, result
in a change in control of any of the registrants.
The directors, the executive officers named in the Summary
Compensation Table above, and the directors and officers as a group
for Entergy Corporation, AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy, respectively, beneficially owned directly or indirectly the
cumulative preferred stock of an Operating Company and common stock of
Entergy Corporation as indicated:
<TABLE>
<CAPTION>
As of December 31, 1995
Entergy Corporation
Common Stock
Preferred Stock(a) Amount and Nature
Amount and Nature of of Beneficial
Beneficial Ownership(b) Ownership(b)
Sole Sole
Voting Voting Other
and Other and Beneficial
Investment Beneficial Investment Ownership
Name Power(c) Ownership Power(c) (d)(e)(f)(g)
<S> <C> <C> <C> <C>
Entergy Corporation
W. Frank Blount* - - 3,734 -
John A. Cooper, Jr.* 6,000 (a) - 6,334 -
Lucie J. Fjeldstad* - - 2,684 -
Dr. Norman C. Francis* - - 1,000 -
Donald C. Hintz** - - 40,451 50,151
Kaneaster Hodges, Jr.* - - 3,517 -
Jerry D. Jackson** - - 40,290 48,148
Robert v.d. Luft* - - 2,984 -
Edwin Lupberger*** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
Gerald D. McInvale** - - 37,005 39,920
Adm. Kinnaird R. McKee* - - 2,167 -
Paul W. Murrill* - - 2,754 -
James R. Nichols* - - 4,179 -
Eugene H. Owen* - 3,500 (a) 2,392 -
John N. Palmer, Sr.* - - 15,000 -
Robert D. Pugh* - - 6,000 10,000 (i)
H. Duke Shackelford* - - 8,750 3,950 (i)
Wm. Clifford Smith* - - 4,670 -
Bismark A. Steinhagen* - - 7,037 -
All directors and executive
officers 6,000 3,500 371,483 371,631
AP&L
Michael B. Bemis** - - 38,793 44,907
Donald C. Hintz** - - 40,451 50,151
Jerry D. Jackson** - - 40,290 48,148
R. Drake Keith*** - - 7,535 12,570
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
All directors and executive
officers - - 416,735 495,796
GSU
Michael B. Bemis** - - 38,793 44,907
Frank F. Gallaher*** - - 37,958 42,616
Donald C. Hintz** - - 40,451 50,151
Jerry D. Jackson** - - 40,290 48,148
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
All directors and executive
officers - - 403,151 474,665
LP&L
Michael B. Bemis** - - 38,793 44,907
John J. Cordaro*** - - 3,669 11,785
Donald C. Hintz** - - 40,451 50,151
Jerry D. Jackson** - - 40,290 48,148
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
All directors and executive
officers - - 406,074 494,161
MP&L
Michael B. Bemis** - - 38,793 44,907
Donald C. Hintz** - - 40,451 50,151
Jerry D. Jackson** - - 40,290 48,148
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
Gerald D. McInvale** - - 37,005 39,920
Donald E. Meiners*** - - 3,328 16,546 (j)
All directors and executive
officers - - 406,640 493,105
NOPSI
Michael B. Bemis** - - 38,793 44,907
John J. Cordaro*** - - 3,669 11,785
William D. Hamilton* - - - 2,208
Jerry D. Jackson** - - 40,290 48,148
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden** - - 77,924 61,816
Gerald D. McInvale** - - 37,005 39,920
All directors and executive
officers - - 366,834 438,088
System Energy
Joseph L. Blount** - - - 2,619
Donald C. Hintz*** - - 40,451 50,151
Jerry D. Jackson* - - 40,290 48,148
Edwin Lupberger** - - 83,552 111,381 (h)(i)
Jerry L. Maulden* - - 77,924 61,816
Gerald D. McInvale** - - 37,005 39,920
William J. Regan - - - 15
All directors and executive
officers - - 279,222 319,114
</TABLE>
* Director of the respective Company
** Named Executive Officer of the respective Company
*** Officer and Director of the respective Company
(a) Stock ownership amounts refer to 6,000 shares of AP&L's $0.01
Par Value ($25 liquidation value) Preferred Stock held by the John
A. Cooper Trust, and 3,500 shares of AP&L's $0.01 Par Value ($25
liquidation value) Preferred Stock held by Eugene H. Owen. Mr.
Cooper disclaims any personal interest in these shares.
(b) Based on information furnished by the respective individuals.
The ownership amounts shown for each individual and for all directors
and executive officers as a group do not exceed one percent of the
outstanding securities of any class of security so owned.
(c) Includes all shares as to which the individual has the sole
voting power and powers of disposition, or power to direct the voting
and disposition.
(d) Includes, for the named persons, shares of Entergy Corporation
common stock held in the Employee Stock Ownership Plan of the
registrants as follows: Michael B. Bemis, 767 shares; Joseph L.
Blount, 810 shares; John J. Cordaro, 1,082 shares; Frank F. Gallaher,
1,011 shares; William D. Hamilton, 617 shares; Donald C. Hintz,
810 shares; Jerry D. Jackson, 810 shares; R. Drake Keith, 810 shares;
Edwin Lupberger, 886 shares; Jerry L. Maulden, 856 shares; Gerald D.
McInvale, 118 shares; and Donald E. Meiners, 594 shares.
(e) Includes, for the named persons, shares of Entergy Corporation
common stock held in the System Savings Plan company account as
follows: Michael B. Bemis, 5,140 shares; Joseph L. Blount, 1,809
shares; John J. Cordaro, 2,003 shares; Frank F. Gallaher, 3,930
shares; William D. Hamilton, 1,591 shares; Donald C. Hintz, 1,412
shares; Jerry D. Jackson, 2,427 shares; R. Drake Keith, 4,336 shares;
Edwin Lupberger, 6,771 shares; Jerry L. Maulden, 10,460 shares;
Gerald D. McInvale, 802 shares; Donald E. Meiners, 4,950 shares;
William J. Regan, 15 shares.
(f) Includes, for the named persons, unvested restricted shares of
Entergy Corporation common stock held in the Equity Ownership Plan as
follows: Michael B. Bemis, 4,000 shares; John J. Cordaro, 1,200
shares; Frank F. Gallaher, 5,175 shares; Donald C. Hintz, 5,429
shares; Jerry D. Jackson, 5,500 shares; R. Drake Keith, 250 shares;
Edwin Lupberger, 10,900 shares; Jerry L. Maulden, 5,500 shares;
Gerald D. McInvale, 4,000 shares; and Donald E. Meiners, 250 shares.
(g) Includes, for the named persons, shares of Entergy Corporation
common stock in the form of unexercised stock options awarded
pursuant to the Equity Ownership Plan as follows: Michael B. Bemis,
35,000 shares; John J. Cordaro 7,500 shares; Frank F. Gallaher,
32,500 shares; Donald C. Hintz, 42,500 shares; Jerry D. Jackson,
39,411 shares; R. Drake Keith, 7,174 shares; Edwin Lupberger, 88,824
shares; Jerry L. Maulden, 45,000 shares; Gerald D. McInvale, 35,000
shares; and Donald E. Meiners, 10,000 shares.
(h) Includes 1,500 shares of Entergy Corporation common stock held
jointly between Edwin Lupberger and Ms. E. H. Lupberger.
(i) Includes, for the named persons, shares of Entergy Corporation
common stock held by their spouses. The named persons disclaim any
personal interest in these shares as follows: Edwin Lupberger, 2,500
shares; Robert D. Pugh, 10,000 shares; and H. Duke Shackelford, 3,950
shares.
(j) Includes 752 shares of Entergy Corporation common stock held
jointly with spouse.
Item 13. Certain Relationships and Related Transactions
Information called for by this item concerning the directors and
officers of Entergy Corporation is set forth under the heading
"Certain Transactions" in the Proxy Statement of Entergy Corporation
to be filed in connection with its Annual Meeting of Stockholders to
be held on May 17, 1996, which information is incorporated herein by
reference.
See Item 10, "Directors and Executive Officers of the
Registrants," for information on certain relationships and
transactions required to be reported under this item.
Other than as provided under applicable corporate laws, the
System companies do not have policies whereby transactions involving
executive officers and directors of the System are approved by a
majority of disinterested directors. However, pursuant to the Entergy
Corporation Code of Conduct, transactions involving a System company
and its executive officers must have prior approval by the next
higher reporting level of that individual, and transactions involving
a System company and its directors must be reported to the secretary
of the appropriate System company.
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a)1. Financial Statements and Independent Auditors' Reports for
Entergy, AP&L, GSU, LP&L, MP&L, NOPSI, and System Energy are
listed in the Index to Financial Statements (see pages 42 and
43)
(a)2. Financial Statement Schedules
Reports of Independent Accountants on Financial Statement
Schedules (see pages 218 and 219)
Financial Statement Schedules are listed in the Index to
Financial Statement Schedules (see page S-1)
(a)3. Exhibits
Exhibits for Entergy, AP&L, GSU, LP&L, MP&L, NOPSI, and System
Energy are listed in the Exhibit Index (see page E-1). Each
management contract or compensatory plan or arrangement
required to be filed as an exhibit hereto is identified as such
by footnote in the Exhibit Index.
(b) Reports on Form 8-K
Entergy and NOPSI
A current report on Form 8-K, dated April 20, 1995, was filed
with the SEC on April 26, 1995, reporting information under
Item 5. "Other Events".
Entergy and GSU
A current report on Form 8-K, dated July 26, 1995, was filed
with the SEC on July 26, 1995, reporting information under Item
5. "Other Events".
A current report on Form 8-K, dated October 25, 1995, was filed
with the SEC on October 25, 1995, reporting information under
Item 5. "Other Events".
<PAGE>
EXPERTS
The statements attributed to Clark, Thomas & Winters, a
professional corporation, as to legal conclusions with respect to
GSU's rate regulation in Texas under Item 1. "Rate Matters and
Regulation - Rate Matters - Retail Rate Matters - GSU" and in Note 2
to Entergy Corporation and Subsidiaries Consolidated Financial
Statements and GSU's Financial Statements, "Rate and Regulatory
Matters," have been reviewed by such firm and are included herein upon
the authority of such firm as experts.
The statements attributed to Sandlin Associates regarding the
analysis of River Bend Construction costs of GSU under Item 1. "Rate
Matters and Regulation - Rate Matters - Retail Rate Matters - GSU" and
in Note 2 to Entergy Corporation and Subsidiaries Consolidated
Financial Statements and GSU's Financial Statements, "Rate and
Regulatory Matters," have been reviewed by such firm and are included
herein upon the authority of such firm as experts.
<PAGE>
ENTERGY CORPORATION
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
ENTERGY CORPORATION
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President
and Chief Accounting Officer
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President and March 11, 1996
Chief Accounting Officer
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer); Gerald
D. McInvale (Executive Vice President and Chief Financial
Officer; Principal Financial Officer); W. Frank Blount, John A.
Cooper, Jr., Lucie J. Fjeldstad, N. C. Francis, Kaneaster
Hodges, Jr., Robert v.d. Luft, Kinnaird R. McKee, Paul W.
Murrill, James R. Nichols, Eugene H. Owen, John N.
Palmer, Sr., Robert D. Pugh, H. Duke Shackelford, Wm.
Clifford Smith, and Bismark A. Steinhagen (Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
ARKANSAS POWER & LIGHT COMPANY
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
ARKANSAS POWER & LIGHT COMPANY
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President,
Chief Accounting Officer and
Assistant Secretary
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President, Chief Accounting March 11, 1996
Officer and Assistant Secretary
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer); Gerald
D. McInvale (Executive Vice President, Chief Financial
Officer, and Director; Principal Financial Officer);
Michael B. Bemis, Donald C. Hintz, Jerry D. Jackson, R.
Drake Keith, and Jerry L. Maulden (Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
GULF STATES UTILITIES COMPANY
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
GULF STATES UTILITIES COMPANY
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President,
Chief Accounting Officer and
Assistant Secretary
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President, Chief Accounting March 11, 1996
Officer and Assistant Secretary
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer);
Gerald D. McInvale (Executive Vice President, Chief
Financial Officer, and Director; Principal Financial
Officer); Michael B. Bemis, Frank F. Gallaher, Donald C.
Hintz, Jerry D. Jackson, and Jerry L. Maulden (Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
LOUISIANA POWER & LIGHT COMPANY
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
LOUISIANA POWER & LIGHT COMPANY
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President,
Chief Accounting Officer and
Assistant Secretary
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President, Chief Accounting March 11, 1996
Officer and Assistant Secretary
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer);
Gerald D. McInvale (Executive Vice President, Chief
Financial Officer, and Director; Principal Financial
Officer); Michael B. Bemis, John J. Cordaro, Donald C.
Hintz, Jerry D. Jackson, and Jerry L. Maulden
(Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President,
Chief Accounting Officer and
Assistant Secretary
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President, Chief Accounting March 11, 1996
Officer and Assistant Secretary
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer);
Gerald D. McInvale (Executive Vice President, Chief
Financial Officer, and Director; Principal Financial
Officer); Michael B. Bemis, Donald C. Hintz, Jerry D.
Jackson, Jerry L. Maulden, and Donald E. Meiners
(Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
NEW ORLEANS PUBLIC SERVICE INC.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
NEW ORLEANS PUBLIC SERVICE INC.
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President,
Chief Accounting Officer and
Assistant Secretary
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President, Chief Accounting March 11, 1996
Officer and Assistant Secretary
(Principal Accounting Officer)
Edwin Lupberger (Chairman of the Board, Chief Executive
Officer and Director; Principal Executive Officer);
Gerald D. McInvale (Executive Vice President, Chief
Financial Officer, and Director; Principal Financial
Officer); John J. Cordaro, Jerry D. Jackson, and Jerry L.
Maulden (Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
SYSTEM ENERGY RESOURCES, INC.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized. The signature of the undersigned company shall be deemed
to relate only to matters having reference to such company and any
subsidiaries thereof.
SYSTEM ENERGY RESOURCES, INC.
By /s/ Louis E. Buck, Jr.
Louis E. Buck, Jr., Vice President
and Chief Accounting Officer
Date: March 11, 1996
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated. The signature of each of the undersigned shall be deemed
to relate only to matters having reference to the above-named company
and any subsidiaries thereof.
Signature Title Date
/s/ Louis E. Buck, Jr.
Louis E. Buck, Jr. Vice President and March 11, 1996
Chief Accounting Officer
(Principal Accounting Officer)
Donald C. Hintz (President, Chief Executive Officer and
Director; Principal Executive Officer); Gerald D.
McInvale (Executive Vice President, Chief Financial
Officer, and Director; Principal Financial Officer); Edwin
Lupberger (Chairman of the Board), and Jerry L. Maulden
(Directors).
By: /s/ Louis E. Buck, Jr. March 11, 1996
(Louis E. Buck, Jr., Attorney-in-fact)
<PAGE>
EXHIBIT 23(a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in Post-Effective
Amendment Nos. 2, 3, 4A, and 5A on Form S-8 and the related
Prospectuses to registration statement of Entergy Corporation on Form S-
4 (File Number 33-54298), of our reports dated February 14, 1996, on
our audits of the financial statements and financial statement
schedules of Entergy Corporation as of and for the years ended December
31, 1995 and 1994, which reports include emphasis paragraphs related to
rate-related contingencies and legal proceedings and a 1995 change of
accounting method for incremental nuclear plant outage maintenance
costs by one of the Corporation's subsidiaries, and are included in
this Annual Report on Form 10-K.
We consent to the incorporation by reference in the registration
statements and the related Prospectuses of Arkansas Power & Light
Company on Form S-3 (File Numbers 33-36149, 33-48356, 33-50289 and 333-
00103) of our reports dated February 14, 1996, on our audits of the
financial statements and financial statement schedule of Arkansas Power
& Light Company as of and for the years ended December 31, 1995 and
1994, which reports include an emphasis paragraph related to the
Company's 1995 change in its method of accounting for incremental
nuclear plant outage maintenance costs, and are included in this Annual
Report on Form 10-K.
We consent to the incorporation by reference in registration
statements and the related Prospectuses of Gulf States Utilities
Company on Form S-3 (File Numbers 33-49739 and 33-51181) and Form S-8
(File Numbers 2-76551 and 2-98011) of our reports dated February 14,
1996, on our audits of the financial statements and financial statement
schedule of Gulf States Utilities Company as of December 31, 1995 and
1994 and for the three years ended December 31, 1995, which reports
include emphasis paragraphs related to rate-related contingencies,
legal proceedings and changes in accounting for income taxes,
postretirement benefits and unbilled revenue, and are included in this
Annual Report on Form 10-K.
We consent to the incorporation by reference in the registration
statements and the related Prospectuses of Louisiana Power & Light
Company on Form S-3 (File Numbers 33-46085, 33-39221, 33-50937, 333-
00105, and 333-01329) of our reports dated February 14, 1996, on our
audits of the financial statements and financial statement schedule of
Louisiana Power & Light Company as of and for the years ended December
31, 1995 and 1994, which are included in this Annual Report on Form 10-
K.
We consent to the incorporation by reference in the registration
statements and the related Prospectuses of Mississippi Power & Light
Company on Form S-3 (File Numbers 33-53004, 33-55826 and 33-50507) of
our reports dated February 14, 1996, on our audits of the financial
statements and financial statement schedule of Mississippi Power &
Light Company as of and for the years ended December 31, 1995 and 1994,
which are included in this Annual Report on Form 10-K.
We consent to the incorporation by reference in the registration
statements and the related Prospectuses of New Orleans Public Service
Inc. on Form S-3 (File Numbers 33-57926 and 333-00255) of our reports
dated February 14, 1996, on our audits of the financial statement and
financial statement schedules of New Orleans Public Service Inc. as of
and for the years ended December 31, 1995 and 1994, which are included
in this Annual Report on Form 10-K.
We consent to the incorporation by reference in the registration
statements and the related Prospectuses of System Energy Resources,
Inc. on Form S-3 (File Numbers 33-47662 and 33-61189) of our reports
dated February 14, 1996, on our audits of the financial statements of
System Energy Resources, Inc. as of and for the years ended December
31, 1995 and 1994, which are included in this Annual Report on Form 10-
K.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
March 8, 1996
<PAGE>
EXHIBIT 23(b)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Post-Effective
Amendments Nos. 2, 3, 4A, and 5A on Form S-8 to Registration Statement
No. 33-54298 of Entergy Corporation on Form S-4, and the related
Prospectuses, of our reports dated February 11, 1994, appearing in
this Annual Report on Form 10-K of Entergy Corporation.
We also consent to the incorporation by reference in Registration
Statements Nos. 333-00103, 33-36149, 33-48356 and 33-50289 of Arkansas
Power & Light Company on Form S-3, and the related Prospectuses, of
our reports dated February 11, 1994, appearing in this Annual Report
on Form 10-K of Arkansas Power & Light Company.
We also consent to the incorporation by reference in Registration
Statements Nos. 333-01329, 333-00105, 33-46085, 33-39221 and 33-50937
of Louisiana Power & Light Company on Form S-3, and the related
Prospectuses, of our reports dated February 11, 1994, appearing in
this Annual Report on Form 10-K of Louisiana Power & Light Company.
We also consent to the incorporation by reference in Registration
Statements Nos. 33-53004, 33-55826 and 33-50507 of Mississippi Power &
Light Company on Form S-3, and the related Prospectuses, of our
reports dated February 11, 1994, appearing in this Annual Report on
Form 10-K of Mississippi Power & Light Company.
We also consent to the incorporation by reference in Registration
Statement Nos. 333-00255 and 33-57926 of New Orleans Public Service
Inc. on Form S-3, and the related Prospectuses, of our reports dated
February 11, 1994, appearing in this Annual Report on Form 10-K of New
Orleans Public Service Inc.
We also consent to the incorporation by reference in Registration
Statement Nos. 33-61189 and 33-47662 of System Energy Resources, Inc.
on Form S-3, and the related Prospectuses, of our reports dated
February 11, 1994 (November 30, 1994 as to Note 2, "Rate and
Regulatory Matters - FERC Settlement"), appearing in this Annual
Report on Form 10-K of System Energy Resources, Inc.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
March 8, 1996
<PAGE>
EXHIBIT 23(c)
CONSENT
We consent to the reference to our firm under the heading
"Experts", and to the inclusion in this Annual Report on Form 10-K of
Gulf States Utilities Company ("GSU") of the statements of legal
conclusions attributed to us herein (the Statements of Legal
Conclusions) under Part I, Item 1. Business - "Rate Matters and
Regulation" and in the discussion of Texas jurisdictional matters set
forth in Note 2 to GSU's Financial Statements and Note 2 to Entergy
Corporation and Subsidiaries Consolidated Financial Statements
appearing as Item 8. of Part II of this Form 10-K, which Statements of
Legal Conclusions have been prepared or reviewed by us (Clark, Thomas
& Winters, a Professional Corporation). We also consent to the
incorporation by reference in the registration statements of GSU on
Form S-3 and Form S-8 (File Numbers 2-76551, 2-98011, 33-49739, and
33-51181) of such reference and Statements of Legal Conclusions.]
CLARK, THOMAS & WINTERS
A Professional Corporation
Austin, Texas
March 11, 1996
<PAGE>
EXHIBIT 23(d)
CONSENT
We consent to the reference to our firm under the heading
"Experts" and to the inclusion in this Annual Report on Form 10-K of
Gulf States Utilities Company ("GSU") of the statements (Statements)
regarding the analysis by our Firm of River Bend construction costs
which are made herein under Part I, Item 1. Business - "Rate Matters
and Regulation" and in the discussion of Texas jurisdictional matters
set forth in Note 2 to GSU's Financial Statements and Note 2 to
Entergy Corporation and Subsidiaries' Consolidated Financial
Statements appearing as Item 8. of Part II of this Form 10-K, which
Statements have been prepared or reviewed by us (Sandlin Associates).
We also consent to the incorporation by reference in the registration
statements of GSU on Form S-3 and Form S-8 (File Numbers 2-76551, 2-
98011, 33-49739 and 33-51181) of such reference and Statements.
SANDLIN ASSOCIATES
Management Consultants
Pasco, Washington
March 11, 1996
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULES
To the Board of Directors and Shareholders
of Entergy Corporation
We have audited the consolidated financial statements of Entergy
Corporation and Subsidiaries and the financial statements of Arkansas
Power & Light Company, Louisiana Power & Light Company, Mississippi
Power & Light Company, New Orleans Public Service Inc., and System
Energy Resources, Inc. as of and for the years ended December 31, 1995
and 1994, and the financial statements of Gulf States Utilities
Company as of December 31, 1995 and 1994, and for each of the three
years in the period ended December 31, 1995, and have issued our
reports, included elsewhere in this Form 10-K, thereon dated February
14, 1996, which reports as to Entergy Corporation and Gulf States
Utilities Company include emphasis paragraphs related to rate-related
contingencies and legal proceedings, and which report as to Gulf
States Utilities Company includes an emphasis paragraph related to
changes in accounting for income taxes, postretirement benefits and
unbilled revenue, and which reports as to Entergy Corporation and
Arkansas Power & Light Company include an emphasis paragraph related
to changes in accounting for incremental nuclear plant outage
maintenance expenses. In connection with our audits of such financial
statements, we have also audited the related financial statement
schedules included in Item 14(a)2 of this Form 10-K.
In our opinion the financial statement schedules referred to
above, when considered in relation to the basic financial statements
taken as a whole, present fairly in all material respects the
information required to be included therein.
COOPERS & LYBRAND L.L.P.
New Orleans, Louisiana
February 14, 1996
<PAGE>
INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENT SCHEDULES
To the Shareholders and the Board of Directors of
Entergy Corporation
We have audited the consolidated financial statements of Entergy
Corporation and subsidiaries and the financial statements of Arkansas
Power & Light Company, Louisiana Power & Light Company, Mississippi
Power & Light Company, New Orleans Public Service Inc., and System
Energy Resources, Inc. for the year ended December 31, 1993, and have
issued our reports thereon dated February 11, 1994, which report as to
Entergy Corporation includes explanatory paragraphs as to
uncertainties because of certain regulatory and litigation matters,
and which report as to System Energy Resources, Inc. is dated
November 30, 1994 as to Note 2, "Rate and Regulatory Matters - FERC
Settlement"; such reports are included elsewhere in this Form 10-K.
Our audit also included the 1993 financial statement schedules of
these companies, listed in Item 14(a)2. These financial statement
schedules are the responsibility of the companies' managements. Our
responsibility is to express an opinion based on our audit. We did
not audit the financial statements of Gulf States Utilities Company (a
consolidated subsidiary of Entergy Corporation acquired on
December 31, 1993), which statements reflect total assets constituting
31% of consolidated total assets at December 31, 1993. Those
statements were audited by other auditors whose report (which included
explanatory paragraphs regarding uncertainties because of certain
regulatory and litigation matters) has been furnished to us, and our
opinion, insofar as it relates to the amounts included for Gulf States
Utilities Company, is based solely on the report of such other
auditors. In our opinion, based on our audit and the report of the
other auditors, such financial statement schedules, when considered in
relation to the basic financial statements taken as a whole, present
fairly in all material respects the information set forth therein.
DELOITTE & TOUCHE LLP
New Orleans, Louisiana
February 11, 1994
<PAGE>
INDEX TO FINANCIAL STATEMENT SCHEDULES
Schedule Page
I Financial Statements of Entergy Corporation:
Statements of Income - For the Years Ended
December 31, 1995, 1994, and 1993 S-2
Statements of Cash Flows - For the Years Ended
December 31, 1995, 1994, and 1993 S-3
Balance Sheets, December 31, 1995 and 1994 S-4
Statements of Retained Earnings and Paid-In
Capital - For the Years Ended December 31,
1995, 1994, and 1993 S-5
II Valuation and Qualifying Accounts
1995, 1994, and 1993:
Entergy Corporation and Subsidiaries S-6
Arkansas Power & Light Company S-7
Gulf States Utilities Company S-8
Louisiana Power & Light Company S-9
Mississippi Power & Light Company S-10
New Orleans Public Service Inc. S-11
Schedules other than those listed above are omitted because they
are not required, not applicable or the required information is shown
in the financial statements or notes thereto.
Columns have been omitted from schedules filed because the
information is not applicable.
<PAGE>
ENTERGY CORPORATION
SCHEDULE I-FINANCIAL STATEMENTS OF ENTERGY CORPORATION
STATEMENTS OF INCOME
For the Years Ended December 31,
1995 1994 1993
(In Thousands)
Income:
Equity in income of subsidiaries $549,144 $369,701 $557,681
Interest on temporary investments 20,641 25,496 18,520
-------- -------- --------
Total 569,785 395,197 576,201
-------- -------- --------
Expenses and Other Deductions:
Administrative and general expenses 53,872 57,846 25,129
Income taxes (credit) (5,383) (6,350) 3,587
Taxes other than income (credit) 1,102 465 (696)
Interest (credit) 214 1,395 (3,749)
-------- -------- --------
Total 49,805 53,356 24,271
-------- -------- --------
Net Income $519,980 $341,841 $551,930
======== ======== ========
See Entergy Corporation and Subsidiaries Notes to Financial
Statements in Part II, Item 8.
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION
SCHEDULE I - FINANCIAL STATEMENTS OF ENTERGY CORPORATION
STATEMENTS OF CASH FLOWS
For the Years Ended December 31,
1995 1994 1993
(In Thousands)
<S> <C> <C> <C>
Operating Activities:
Net income $519,980 $341,841 $551,930
Noncash items included in net income:
Equity in earnings of subsidiaries (549,144) (369,701) (557,681)
Deferred income taxes (2,024) 7,007 3,771
Depreciation 1,421 959 -
Changes in working capital:
Receivables 2,161 (5,085) (1,082)
Payables (3,776) (11,945) 1,367
Other working capital accounts (1,701) (2,563) 531
Common stock dividends received from subsidiaries 565,589 763,400 686,700
Other 8,652 (12,137) (20,938)
-------- -------- --------
Net cash flow provided by operating activities 541,158 711,776 664,598
-------- -------- --------
Investing Activities:
Merger with GSU - cash paid - - (250,000)
Investment in subsidiaries (477,709) (49,892) (86,221)
Capital expenditures - (3,178) (22,861)
Decrease in other temporary investments - - 17,012
Proceeds received from the sale of property - 26,000 -
Advance to subsidiary 221,540 (11,840) (24,642)
-------- -------- --------
Net cash flow used in investing activities (256,169) (38,910) (366,712)
-------- -------- --------
Financing Activities:
Changes in short-term borrowings - (43,000) 43,000
Common stock dividends paid (408,553) (410,223) (287,483)
Retirement of common stock - (119,486) (20,558)
-------- -------- --------
Net cash flow used in financing activities (408,553) (572,709) (265,041)
-------- -------- --------
Net increase (decrease) in cash and cash equivalents (123,564) 100,157 32,845
Cash and cash equivalents at beginning of period 252,708 152,551 119,706
-------- -------- --------
Cash and cash equivalents at end of period $129,144 $252,708 $152,551
======== ======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Noncash investing and financing activities:
Merger with GSU-Common stock issued - - $2,032,071
See Entergy Corporation and Subsidiaries Notes to Financial Statements
in Part II, Item 8.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION
SCHEDULE I - FINANCIAL STATEMENTS OF ENTERGY CORPORATION
BALANCE SHEETS
December 31,
1995 1994
(In Thousands)
ASSETS
<S> <C> <C>
Investment in Wholly-owned Subsidiaries $6,354,267 $6,110,504
---------- ----------
Current Assets:
Cash and cash equivalents:
Cash 25 -
Temporary cash investments - at cost,
which approximates market:
Associated companies 29,180 83,339
Other 99,939 169,369
---------- ----------
Total cash and cash equivalents 129,144 252,708
Accounts receivable:
Associated companies 8,697 10,413
Other 356 375
Interest receivable 497 923
Other 9,511 6,901
---------- ----------
Total 148,205 271,320
---------- ----------
Deferred Debits 47,381 55,185
---------- ----------
TOTAL $6,549,853 $6,437,009
========== ==========
CAPITALIZATION AND LIABILITIES
Capitalization:
Common stock, $.01 par value in 1995 and 1994:
authorized 500,000,000 shares; issued
230,017,485 shares in 1995 and 1994 $2,300 $2,300
Paid-in capital 4,201,483 4,202,134
Retained earnings 2,335,579 2,223,739
Less cost of treasury stock 2,251,318 shares in
1995 and 2,608,908 shares in 1994) (67,642) (77,378)
---------- ----------
Total common shareholders' equity 6,471,720 6,350,795
---------- ----------
Current Liabilities:
Accounts payable:
Associated companies 762 4,578
Other 1,142 1,102
Other current liabilities 5,930 5,021
---------- ----------
Total 7,834 10,701
---------- ----------
Deferred Credits and Noncurrent Liabilities 70,299 75,513
---------- ----------
Total $6,549,853 $6,437,009
========== ==========
See Entergy Corporation and Subsidiaries Notes to Financial Statements
in Part II, Item 8.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION
SCHEDULE I - FINANCIAL STATEMENTS OF ENTERGY CORPORATION
STATEMENTS OF RETAINED EARNINGS AND PAID-IN CAPITAL
For the Years Ended December 31,
1995 1994 1993
(In Thousands)
<S> <C> <C> <C>
Retained Earnings, January 1 $2,223,739 $2,310,082 $2,062,188
Add:
Net income 519,980 341,841 551,930
---------- ---------- ----------
Total 2,743,719 2,651,923 2,614,118
---------- ---------- ----------
Deduct:
Dividends declared on common stock 409,801 411,806 288,342
Common stock retirements - 13,940 13,906
Capital stock and other expenses (1,661) 2,438 1,788
---------- ---------- ----------
Total 408,140 428,184 304,036
---------- ---------- ----------
Retained Earnings, December 31 $2,335,579 $2,223,739 $2,310,082
========== ========== ==========
Paid-in Capital, January 1 $4,202,134 $4,223,682 $1,327,589
Add:
Gain (loss) on reacquisition of
subsidiaries' preferred stock (26) (23) (20)
Issuance of 56,695,724 shares of common
stock in the merger with GSU - - 2,027,325
Issuance of 174,552,011 shares of common
stock at $.01 par value net of the
retirement of 174,552,011 shares of
common stock at $5.00 par value - - 871,015
Issuance of stock related to ESIP (3,002)
---------- ---------- ----------
Total 4,199,106 4,223,659 4,225,909
---------- ---------- ----------
Deduct:
Common stock retirements - 22,468 4,389
Capital stock discounts and other expenses (2,377) (943) (2,162)
---------- ---------- ----------
Total (2,377) 21,525 2,227
---------- ---------- ----------
Paid-in Capital, December 31 $4,201,483 $4,202,134 $4,223,682
========== ========== ==========
See Entergy Corporation and Subsidiaries Notes to Financial Statements
in Part II, Item 8.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ENTERGY CORPORATION AND SUBSIDIARIES
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E Column F
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions Acquistion at End
Description of Period Income (Note 1) of GSU of Period
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $6,740 $14,586 $14,217 - $7,109
Other 0 12,337 0 - 12,337
------- ------- ------- ------- -------
Total $6,740 $26,923 $14,217 - $19,446
======= ======= ======= ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $32,871 $16,263 $12,401 - $36,733
Injuries and damages (Note 2) 22,066 11,667 13,752 - 19,981
Environmental 42,739 7,639 10,116 - 40,262
------- ------- ------- ------- -------
Total $97,676 $35,569 $36,269 - $96,976
======= ======= ======= ======= =======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $8,808 $8,266 $10,334 - $6,740
======= ======= ======= ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $34,546 $25,592 $27,267 - $32,871
Injuries and damages (Note 2) 23,096 10,993 12,023 - 22,066
Environmental 26,753 21,292 5,306 - 42,739
------- ------- ------- ------- -------
Total $84,395 $57,877 $44,596 - $97,676
======= ======= ======= ======= =======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $6,193 $8,565 $8,333 $2,383 $8,808
======= ======= ======= ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $25,177 $5,714 $7,217 $10,872 $34,546
Injuries and damages (Note 2) 15,978 11,702 14,053 9,469 23,096
Environmental 8,006 1,672 1,076 18,151 26,753
------- ------- ------- ------- -------
Total $49,161 $19,088 $22,346 $38,492 $84,395
======= ======= ======= ======= =======
___________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling claims
for injuries and damages.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ARKANSAS POWER & LIGHT COMPANY
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions at End
Description of Period Income (Note 1) of Period
<S> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,950 $3,997 $3,889 $2,058
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $1,916 $4,810 $5,826 $900
Injuries and damages (Note 2) 2,660 710 1,560 1,810
Environmental 5,350 4,435 3,271 6,514
------- ------ ------- -------
Total $9,926 $9,955 $10,657 $9,224
======= ====== ======= =======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $2,050 $1,967 $2,067 $1,950
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $2,821 $18,782 $19,687 $1,916
Injuries and damages (Note 2) 3,259 1,316 1,915 2,660
Environmental 6,825 1,510 2,985 5,350
------- ------ ------- -------
Total $12,905 $21,608 $24,587 $9,926
======= ====== ======= =======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,613 $3,439 $3,002 $2,050
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $5,182 $1,952 $4,313 $2,821
Injuries and damages (Note 2) 5,851 4,070 6,662 3,259
Environmental 6,766 1,122 1,063 6,825
------- ------ ------- -------
Total $17,799 $7,144 $12,038 $12,905
======= ====== ======= =======
___________________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling claims
for injuries and damages.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GULF STATES UTILITIES COMPANY
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions at End
Description of Period Income (Note 1) of Period
<S> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $715 $3,715 $2,822 $1,608
======= ======= ======= =======
Accumulated Provisions
Not Deducted from Assets--
Property insurance $10,451 $6,396 $2,706 $14,141
Injuries and damages (Note 2) 6,922 6,243 7,966 5,199
Environmental 20,314 2,483 933 21,864
------- ------- ------- -------
Total $37,687 $15,122 $11,605 $41,204
======= ======= ======= =======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $2,383 $701 $2,369 $715
======= ======= ======= =======
Accumulated Provisions
Not Deducted from Assets--
Property insurance $10,872 $2,170 $2,591 $10,451
Injuries and damages (Note 2) 9,469 2,970 5,517 6,922
Environmental 18,151 2,589 426 20,314
------- ------- ------- -------
Total $38,492 $7,729 $8,534 $37,687
======= ======= ======= =======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $2,953 $929 $1,499 $2,383
======= ======= ======= =======
Accumulated Provisions
Not Deducted from Assets--
Property insurance $9,397 $1,302 ($173) $10,872
Injuries and damages (Note 2) 6,594 11,511 8,636 9,469
Environmental 19,328 3 1,180 18,151
------- ------- ------- -------
Total $35,319 $12,816 $9,643 $38,492
======= ======= ======= =======
___________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling
claims for injuries and damages.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LOUISIANA POWER & LIGHT COMPANY
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions at End
Description of Period Income (Note 1) of Period
<S> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,175 $2,450 $2,235 $1,390
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $814 $3,537 $3,338 $1,013
Injuries and damages (Note 2) 7,350 4,486 3,422 8,414
Environmental 16,394 (89) 4,926 11,379
------- ------ ------- -------
Total $24,558 $7,934 $11,686 $20,806
======= ====== ======= =======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,075 $2,023 $1,923 $1,175
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $2,388 $3,120 $4,694 $814
Injuries and damages (Note 2) 4,779 5,848 3,277 7,350
Environmental 1,237 16,868 1,711 16,394
------- ------ ------- -------
Total $8,404 $25,836 $9,682 $24,558
======= ====== ======= =======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,956 $337 $1,218 $1,075
======= ====== ======= =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $2,474 $1,800 $1,886 $2,388
Injuries and damages (Note 2) 6,153 2,748 4,122 4,779
Environmental 700 550 13 1,237
------- ------ ------- -------
Total $9,327 $5,098 $6,021 $8,404
======= ====== ======= =======
___________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling
claims for injuries and damages.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MISSISSIPPI POWER & LIGHT COMPANY
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions at End
Description of Period Income (Note 1) of Period
<S> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $2,070 $1,691 $2,176 $1,585
====== ====== ====== ======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $3,779 $1,520 $286 $5,013
Injuries and damages (Note 2) 3,725 (1,154) 6 2,565
Environmental 684 735 952 467
------ ------ ------ ------
Total $8,188 $1,101 $1,244 $8,045
====== ====== ====== ======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $2,470 $1,897 $2,297 $2,070
====== ====== ====== ======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $2,554 $1,520 $295 $3,779
Injuries and damages (Note 2) 3,478 365 118 3,725
Environmental 500 300 116 684
------ ------ ------ ------
Total $6,532 $2,185 $529 $8,188
====== ====== ====== ======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,274 $3,629 $2,433 $2,470
====== ====== ====== ======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $2,051 $1,521 $1,018 $2,554
Injuries and damages (Note 2) 1,645 3,202 1,369 3,478
Environmental 500 - - 500
------ ------ ------ ------
Total $4,196 $4,723 $2,387 $6,532
====== ====== ====== ======
___________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling
claims for injuries and damages.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NEW ORLEANS PUBLIC SERVICE INC.
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1995, 1994, and 1993
(In Thousands)
Column A Column B Column C Column D Column E
Other
Additions Changes
Deductions
Balance at from Balance
Beginning Charged to Provisions at End
Description of Period Income (Note 1) of Period
<S> <C> <C> <C> <C>
Year ended December 31, 1995
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $830 $2,733 $3,095 $468
======= ====== ====== =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $15,911 - $245 $15,666
Injuries and damages (Note 2) 1,409 1,382 798 1,993
Environmental (3) 75 34 38
------- ------ ------ -------
Total $17,317 $1,457 $1,077 $17,697
======= ====== ====== =======
Year ended December 31, 1994
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $830 $1,678 $1,678 $830
======= ====== ====== =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $15,911 - - $15,911
Injuries and damages (Note 2) 2,111 494 1,196 1,409
Environmental 40 25 68 (3)
------- ------ ------ -------
Total $18,062 $519 $1,264 $17,317
======= ====== ====== =======
Year ended December 31, 1993
Accumulated Provisions
Deducted from Assets--
Doubtful Accounts $1,350 $1,160 $1,680 $830
======= ====== ====== =======
Accumulated Provisions Not
Deducted from Assets:
Property insurance $15,470 $441 - $15,911
Injuries and damages (Note 2) 2,329 1,682 1,900 2,111
Environmental 40 - - 40
------- ------ ------ -------
Total $17,839 $2,123 $1,900 $18,062
======= ====== ====== =======
___________
Notes:
(1) Deductions from provisions represent losses or expenses for which the
respective provisions were created. In the case of the provision for
doubtful accounts, such deductions are reduced by recoveries of
amounts previously written off.
(2) Injuries and damages provision is provided to absorb all current
expenses as appropriate and for the estimated cost of settling
claims for injuries and damages.
</TABLE>
<PAGE>
EXHIBIT INDEX
The following exhibits indicated by an asterisk preceding the
exhibit number are filed herewith. The balance of the exhibits
have heretofore been filed with the SEC, respectively, as the
exhibits and in the file numbers indicated and are incorporated
herein by reference. The exhibits marked with a (+) are
management contracts or compensatory plans or arrangements
required to be filed herewith and required to be identified as
such by Item 14 of Form 10-K. Reference is made to a duplicate
list of exhibits being filed as a part of this Form 10-K, which
list, prepared in accordance with Item 102 of Regulation S-T of
the SEC, immediately precedes the exhibits being physically filed
with this Form 10-K.
(3) (i) Articles of Incorporation
Entergy Corporation
(a) 1 -- Certificate of Incorporation of Entergy
Corporation dated December 31, 1993 (A-1(a) to Rule 24
Certificate in 70-8059).
System Energy
(b) 1 -- Amended and Restated Articles of Incorporation of
System Energy and amendments thereto through April 28,
1989 (A-1(a) to Form U-1 in 70-5399).
AP&L
(c) 1 -- Amended and Restated Articles of Incorporation of
AP&L and amendments thereto through May 27, 1992 (4(c) in
33-50289).
GSU
(d) 1 -- Restated Articles of Incorporation of GSU and
amendments thereto through May 28, 1993 (A-11 in 70-
8059).
(d) 2 -- Statement of Resolution amending Restated Articles
of Incorporation, as amended, of GSU (A-11(a) in 70-
8059).
LP&L
(e) 1 -- Restated Articles of Incorporation of LP&L and
amendments thereto through July 21, 1994 (3(a) to Form 10-
Q for the quarter ended June 30, 1994 in 1-8474).
MP&L
*(f) 1 -- Restated Articles of Incorporation of MP&L and
amendments thereto through January 19, 1996.
NOPSI
(g) 1 -- Restatement of Articles of Incorporation of NOPSI
and amendments thereto through July 21, 1994 (3(c) to
Form 10-Q for the quarter ended June 30, 1994 in 0-5807).
(3) (ii) By-Laws
(a) -- By-Laws of Entergy Corporation effective August
25, 1992, and as presently in effect (A-2(a) to Rule 24
Certificate in 70-8059).
(b) -- By-Laws of System Energy effective May 4, 1989,
and as presently in effect (A-2(a) in 70-5399).
(c) -- By-Laws of AP&L as amended effective May 5, 1994,
and as presently in effect (4(f) in 33-50289).
(d) -- By-Laws of GSU as amended effective May 5, 1994,
and as presently in effect (A-12 in 70-8059).
(e) -- By-Laws of LP&L effective January 23, 1984, and as
presently in effect (A-4 in 70-6962).
*(f) -- By-Laws of MP&L effective April 5, 1995, and as
presently in effect.
(g) -- By-Laws of NOPSI effective May 5, 1994, and as
presently in effect (3(b) to Form 10-Q for the quarter
ended September 30, 1989 in 0-5807).
(4) Instruments Defining Rights of Security Holders,
Including Indentures
Entergy Corporation
(a) 1 -- See (4)(b) through (4)(g) below for instruments
defining the rights of holders of long-term debt of
System Energy, AP&L, GSU, LP&L, MP&L and NOPSI.
(a) 2 -- Credit Agreement, dated as of October 3, 1989,
between System Fuels and The Yasuda Trust and Banking
Co., Ltd., New York Branch, as agent (B-1(c) to Rule 24
Certificate, dated October 6, 1989, in 70-7668).
(a) 3 -- First Amendment, dated as of March 1, 1992, to
Credit Agreement, dated as of October 3, 1989, between
System Fuels and The Yasuda Trust and Banking Co., Ltd.,
New York Branch, as agent (4(a)5 to Form 10-K for the
year ended December 31, 1991 in 1-3517).
(a) 4 -- Second Amendment, dated as of September 30, 1992,
to Credit Agreement dated as of October 3, 1989, between
System Fuels and The Yasuda Trust and Banking Co., Ltd.,
New York Branch, as agent (4(a)6 to Form 10-K for the
year ended December 31, 1992 in 1-3517).
(a) 5 -- Security Agreement, dated as of October 3, 1989,
as amended, between System Fuels and The Yasuda Trust and
Banking Co., Ltd., New York Branch, as agent (B-3(c) to
Rule 24 Certificate, dated October 6, 1989, in 70-7668),
as amended by First Amendment to Security Agreement,
dated as of March 14, 1990 (A to Rule 24 Certificate,
dated March 7, 1990, in 70-7668).
(a) 6 -- Consent and Agreement, dated as of October 3,
1989, among System Fuels, The Yasuda Trust and Banking
Co., Ltd., New York Branch, as agent, AP&L, LP&L, and
System Energy (B-5(c) to Rule 24 Certificate, dated
October 6, 1989, in 70-7668).
(a) 7 -- Credit Agreement, dated as of October 10, 1995,
among Entergy, the Banks (Bank of America National Trust
& Savings Association, The Bank of New York, Chemical
Bank, Citibank, N.A., Union Bank of Switzerland, ABN AMRO
Bank N.V., the Bank of Nova Scotia, Canadian Imperial
Bank of Commerce, Bank N.A., First National Bank of
Commerce and Whitney National Bank) and Citibank, N.A.,
as Agent (Exhibit B to Rule 24 Certificate dated October
20, 1995 in File No. 70-8149).
System Energy
(b) 1 -- Mortgage and Deed of Trust, dated as of June 15,
1977, as amended by nineteen Supplemental Indentures (A-1
in 70-5890 (Mortgage); B and C to Rule 24 Certificate in
70-5890 (First); B to Rule 24 Certificate in 70-6259
(Second); 20(a)-5 to Form 10-Q for the quarter ended
June 30, 1981, in 1-3517 (Third); A-1(e)-1 to Rule 24
Certificate in 70-6985 (Fourth); B to Rule 24 Certificate
in 70-7021 (Fifth); B to Rule 24 Certificate in 70-7021
(Sixth); A-3(b) to Rule 24 Certificate in 70-7026
(Seventh); A-3(b) to Rule 24 Certificate in 70-7158
(Eighth); B to Rule 24 Certificate in 70-7123 (Ninth);
B-1 to Rule 24 Certificate in 70-7272 (Tenth); B-2 to
Rule 24 Certificate in 70-7272 (Eleventh); B-3 to Rule 24
Certificate in 70-7272 (Twelfth); B-1 to Rule 24
Certificate in 70-7382 (Thirteenth); B-2 to Rule 24
Certificate in 70-7382 (Fourteenth); A-2(c) to Rule 24
Certificate in 70-7946 (Fifteenth); A-2(c) to Rule 24
Certificate in 70-7946 (Sixteenth); A-2(d) to Rule 24
Certificate in 70-7946 (Seventeenth); A-2(e) to Rule 24
Certificate dated May 4, 1993 in 70-7946 (Eighteenth);
and A-2(g) to Rule 24 Certificate dated May 6, 1994, in
70-7946 (Nineteenth)).
(b) 2 -- Facility Lease No. 1, dated as of December 1,
1988, between Meridian Trust Company and Stephen M.
Carta (Steven Kaba, successor), as Owner Trustees, and
System Energy (B-2(c)(1) to Rule 24 Certificate dated
January 9, 1989 in 70-7561), as supplemented by Lease
Supplement No. 1 dated as of April 1, 1989 (B-22(b) (1)
to Rule 24 Certificate dated April 21, 1989 in 70-7561)
and Lease Supplement No. 2 dated as of January 1, 1994 (B-
3(d) to Rule 24 Certificate dated January 31, 1994 in 70-
8215).
(b) 3 -- Facility Lease No. 2, dated as of December 1, 1988
between Meridian Trust Company and Stephen M. Carta
(Steven Kaba, successor), as Owner Trustees, and System
Energy (B-2(c)(2) to Rule 24 Certificate dated January 9,
1989 in 70-7561), as supplemented by Lease Supplement No.
1 dated as of April 1, 1989 (B-22(b) (2) to Rule 24
Certificate dated April 21, 1989 in 70-7561) and Lease
Supplement No. 2 dated as of January 1, 1994 (B-4(d)
Rule 24 Certificate dated January 31, 1994 in 70-8215).
(b) 4 -- Indenture (for Unsecured Debt Securities), dated
as of September 1, 1995, between System Energy Resources,
Inc., and Chemical Bank (B-10(a) to Rule 24 Certificate
in 70-8511).
AP&L
(c) 1 -- Mortgage and Deed of Trust, dated as of
October 1, 1944, as amended by fifty-two Supplemental
Indentures (7(d) in 2-5463 (Mortgage); 7(b) in 2-7121
(First); 7(c) in 2-7605 (Second); 7(d) in 2-8100 (Third);
7(a)-4 in 2-8482 (Fourth); 7(a)-5 in 2-9149 (Fifth);
4(a)-6 in 2-9789 (Sixth); 4(a)-7 in 2-10261 (Seventh);
4(a)-8 in 2-11043 (Eighth); 2(b)-9 in 2-11468 (Ninth);
2(b)-10 in 2-15767 (Tenth); D in 70-3952 (Eleventh); D in
70-4099 (Twelfth); 4(d) in 2-23185 (Thirteenth); 2(c) in
2-24414 (Fourteenth); 2(c) in 2-25913 (Fifteenth); 2(c)
in 2-28869 (Sixteenth); 2(d) in 2-28869 (Seventeenth);
2(c) in 2-35107 (Eighteenth); 2(d) in 2-36646
(Nineteenth); 2(c) in 2-39253 (Twentieth); 2(c) in
2-41080 (Twenty-first); C-1 to Rule 24 Certificate in
70-5151 (Twenty-second); C-1 to Rule 24 Certificate in
70-5257 (Twenty-third); C to Rule 24 Certificate in
70-5343 (Twenty-fourth); C-1 to Rule 24 Certificate in
70-5404 (Twenty-fifth); C to Rule 24 Certificate in
70-5502 (Twenty-sixth); C-1 to Rule 24 Certificate in
70-5556 (Twenty-seventh); C-1 to Rule 24 Certificate in
70-5693 (Twenty-eighth); C-1 to Rule 24 Certificate in
70-6078 (Twenty-ninth); C-1 to Rule 24 Certificate in
70-6174 (Thirtieth); C-1 to Rule 24 Certificate in
70-6246 (Thirty-first); C-1 to Rule 24 Certificate in
70-6498 (Thirty-second); A-4b-2 to Rule 24 Certificate in
70-6326 (Thirty-third); C-1 to Rule 24 Certificate in
70-6607 (Thirty-fourth); C-1 to Rule 24 Certificate in
70-6650 (Thirty-fifth); C-1 to Rule 24 Certificate, dated
December 1, 1982, in 70-6774 (Thirty-sixth); C-1 to
Rule 24 Certificate, dated February 17, 1983, in 70-6774
(Thirty-seventh); A-2(a) to Rule 24 Certificate, dated
December 5, 1984, in 70-6858 (Thirty-eighth); A-3(a) to
Rule 24 Certificate in 70-7127 (Thirty-ninth); A-7 to
Rule 24 Certificate in 70-7068 (Fortieth); A-8(b) to
Rule 24 Certificate dated July 6, 1989 in 70-7346
(Forty-first); A-8(c) to Rule 24 Certificate, dated
February 1, 1990 in 70-7346 (Forty-second); 4 to Form
10-Q for the quarter ended September 30, 1990 in 1-10764
(Forty-third); A-2(a) to Rule 24 Certificate, dated
November 30, 1990, in 70-7802 (Forty-fourth); A-2(b) to
Rule 24 Certificate, dated January 24, 1991, in 70-7802
(Forty-fifth); 4(d)(2) in 33-54298 (Forty-sixth); 4(c)(2)
to Form 10-K for the year ended December 31, 1992 in 1-
10764 (Forty-seventh); 4(b) to Form 10-Q for the quarter
ended June 30, 1993 in 1-10764 (Forty-eighth); 4(c) to
Form 10-Q for the quarter ended June 30, 1993 in 1-10764
(Forty-ninth); 4(b) to Form 10-Q for the quarter ended
September 30, 1993 in 1-10764 (Fiftieth); 4(c) to Form 10-
Q for the quarter ended September 30, 1993 in 1-10764
(Fifty-first); and 4(a) to Form 10-Q for the quarter
ended June 30, 1994 (Fifty-second)).
GSU
(d) 1 -- Indenture of Mortgage, dated September 1, 1926, as
amended by certain Supplemental Indentures (B-a-I-1 in
Registration No. 2-2449 (Mortgage); 7-A-9 in Registration
No. 2-6893 (Seventh); B to Form 8-K dated September 1,
1959 (Eighteenth); B to Form 8-K dated February 1, 1966
(Twenty-second); B to Form 8-K dated March 1, 1967
(Twenty-third); C to Form 8-K dated March 1, 1968 (Twenty-
fourth); B to Form 8-K dated November 1, 1968 (Twenty-
fifth); B to Form 8-K dated April 1, 1969 (Twenty-sixth);
2-A-8 in Registration No. 2-66612 (Thirty-eighth); 4-2 to
Form 10-K for the year ended December 31, 1984 in 1-2703
(Forty-eighth); 4-2 to Form 10-K for the year ended
December 31, 1988 in 1-2703 (Fifty-second); 4 to Form 10-
K for the year ended December 31, 1991 in 1-2703 (Fifty-
third); 4 to Form 8-K dated July 29, 1992 in 1-2703
(Fifth-fourth); 4 to Form 10-K dated December 31, 1992
in 1-2703 (Fifty-fifth); 4 to Form 10-Q for the quarter
ended March 31, 1993 in 1-2703 (Fifty-sixth); and 4-2 to
Amendment No. 9 to Registration No. 2-76551 (Fifty-
seventh)).
(d) 2 -- Indenture, dated March 21, 1939, accepting
resignation of The Chase National Bank of the City of New
York as trustee and appointing Central Hanover Bank and
Trust Company as successor trustee (B-a-1-6 in
Registration No. 2-4076).
(d) 3 -- Trust Indenture for 9.72% Debentures due July 1,
1998 (4 in Registration No. 33-40113).
LP&L
(e) 1 -- Mortgage and Deed of Trust, dated as of April 1,
1944, as amended by fifty Supplemental Indentures (7(d)
in 2-5317 (Mortgage); 7(b) in 2-7408 (First); 7(c) in
2-8636 (Second); 4(b)-3 in 2-10412 (Third); 4(b)-4 in
2-12264 (Fourth); 2(b)-5 in 2-12936 (Fifth); D in 70-3862
(Sixth); 2(b)-7 in 2-22340 (Seventh); 2(c) in 2-24429
(Eighth); 4(c)-9 in 2-25801 (Ninth); 4(c)-10 in 2-26911
(Tenth); 2(c) in 2-28123 (Eleventh); 2(c) in 2-34659
(Twelfth); C to Rule 24 Certificate in 70-4793
(Thirteenth); 2(b)-2 in 2-38378 (Fourteenth); 2(b)-2 in
2-39437 (Fifteenth); 2(b)-2 in 2-42523 (Sixteenth); C to
Rule 24 Certificate in 70-5242 (Seventeenth); C to
Rule 24 Certificate in 70-5330 (Eighteenth); C-1 to
Rule 24 Certificate in 70-5449 (Nineteenth); C-1 to
Rule 24 Certificate in 70-5550 (Twentieth); A-6(a) to
Rule 24 Certificate in 70-5598 (Twenty-first); C-1 to
Rule 24 Certificate in 70-5711 (Twenty-second); C-1 to
Rule 24 Certificate in 70-5919 (Twenty-third); C-1 to
Rule 24 Certificate in 70-6102 (Twenty-fourth); C-1 to
Rule 24 Certificate in 70-6169 (Twenty-fifth); C-1 to
Rule 24 Certificate in 70-6278 (Twenty-sixth); C-1 to
Rule 24 Certificate in 70-6355 (Twenty-seventh); C-1 to
Rule 24 Certificate in 70-6508 (Twenty-eighth); C-1 to
Rule 24 Certificate in 70-6556 (Twenty-ninth); C-1 to
Rule 24 Certificate in 70-6635 (Thirtieth); C-1 to
Rule 24 Certificate in 70-6834 (Thirty-first); C-1 to
Rule 24 Certificate in 70-6886 (Thirty-second); C-1 to
Rule 24 Certificate in 70-6993 (Thirty-third); C-2 to
Rule 24 Certificate in 70-6993 (Thirty-fourth); C-3 to
Rule 24 Certificate in 70-6993 (Thirty-fifth); A-2(a) to
Rule 24 Certificate in 70-7166 (Thirty-sixth); A-2(a) in
70-7226 (Thirty-seventh); C-1 to Rule 24 Certificate in
70-7270 (Thirty-eighth); 4(a) to Quarterly Report on
Form 10-Q for the quarter ended June 30, 1988, in 1-8474
(Thirty-ninth); A-2(b) to Rule 24 Certificate in 70-7553
(Fortieth); A-2(d) to Rule 24 Certificate in 70-7553
(Forty-first); A-3(a) to Rule 24 Certificate in 70-7822
(Forty-second); A-3(b) to Rule 24 Certificate in 70-7822
(Forty-third); A-2(b) to Rule 24 Certificate in File
No. 70-7822 (Forty-fourth); A-3(c) to Rule 24 Certificate
in 70-7822 (Forty-fifth); A-2(c) to Rule 24 Certificate
dated April 7, 1993 in 70-7822 (Forty-sixth); A-3(d) to
Rule 24 Certificate dated June 4, 1993 in 70-7822 (Forth-
seventh); A-3(e) to Rule 24 Certificate dated December
21, 1993 in 70-7822 (Forty-eighth); A-3(f) to Rule 24
Certificate dated August 1, 1994 in 70-7822 (Forty-ninth)
and A-4(c) to Rule 24 Certificate dated September 28,
1994 in 70-7653 (Fiftieth)).
(e) 2 -- Facility Lease No. 1, dated as of September 1,
1989, between First National Bank of Commerce, as Owner
Trustee, and LP&L (4(c)-1 in Registration No. 33-30660).
(e) 3 -- Facility Lease No. 2, dated as of September 1,
1989, between First National Bank of Commerce, as Owner
Trustee, and LP&L (4(c)-2 in Registration No. 33-30660).
(e) 4 -- Facility Lease No. 3, dated as of September 1,
1989, between First National Bank of Commerce, as Owner
Trustee, and LP&L (4(c)-3 in Registration No. 33-30660).
MP&L
(f) 1 -- Mortgage and Deed of Trust, dated as of September
1, 1944, as amended by twenty-five Supplemental
Indentures (7(d) in 2-5437 (Mortgage); 7(b) in 2-7051
(First); 7(c) in 2-7763 (Second); 7(d) in 2-8484 (Third);
4(b)-4 in 2-10059 (Fourth); 2(b)-5 in 2-13942 (Fifth);
A-11 to Form U-1 in 70-4116 (Sixth); 2(b)-7 in 2-23084
(Seventh); 4(c)-9 in 2-24234 (Eighth); 2(b)-9(a) in
2-25502 (Ninth); A-11(a) to Form U-1 in 70-4803 (Tenth);
A-12(a) to Form U-1 in 70-4892 (Eleventh); A-13(a) to
Form U-1 in 70-5165 (Twelfth); A-14(a) to Form U-1 in
70-5286 (Thirteenth); A-15(a) to Form U-1 in 70-5371
(Fourteenth); A-16(a) to Form U-1 in 70-5417 (Fifteenth);
A-17 to Form U-1 in 70-5484 (Sixteenth); 2(a)-19 in
2-54234 (Seventeenth); C-1 to Rule 24 Certificate in
70-6619 (Eighteenth); A-2(c) to Rule 24 Certificate in
70-6672 (Nineteenth); A-2(d) to Rule 24 Certificate in
70-6672 (Twentieth); C-1(a) to Rule 24 Certificate in
70-6816 (Twenty-first); C-1(a) to Rule 24 Certificate in
70-7020 (Twenty-second); C-1(b) to Rule 24 Certificate in
70-7020 (Twenty-third); C-1(a) to Rule 24 Certificate in
70-7230 (Twenty-fourth); and A-2(a) to Rule 24
Certificate in 70-7419 (Twenty-fifth)).
(f) 2 -- Mortgage and Deed of Trust, dated as of
February 1, 1988, as amended by tenth Supplemental
Indentures (A-2(a)-2 to Rule 24 Certificate in 70-7461
(Mortgage); A-2(b)-2 in 70-7461 (First); A-5(b) to
Rule 24 Certificate in 70-7419 (Second); A-4(b) to
Rule 24 Certificate in 70-7554 (Third); A-1(b)-1 to Rule
24 Certificate in 70-7737 (Fourth); A-2(b) to Rule 24
Certificate dated November 24, 1992 in 70-7914 (Fifth);
A-2(e) to Rule 24 Certificate dated January 22, 1993 in
70-7914 (Sixth); A-2(g) to Form U-1 in 70-7914 (Seventh);
A-2(i) to Rule 24 Certificate dated November 10, 1993 in
70-7914 (Eighth); A-2(j) to Rule 24 Certificate dated
July 22, 1994 in 70-7914 (Ninth); and (A-2(l) to Rule 24
Certificate dated April 21, 1995 in File 70-7914
(Tenth)).
NOPSI
(g) 1 -- Mortgage and Deed of Trust, dated as of July 1,
1944, as amended by eleven Supplemental Indentures (B-3
in 2-5411 (Mortgage); 7(b) in 2-7674 (First); 4(a)-2 in
2-10126 (Second); 4(b) in 2-12136 (Third); 2(b)-4 in
2-17959 (Fourth); 2(b)-5 in 2-19807 (Fifth); D to Rule 24
Certificate in 70-4023 (Sixth); 2(c) in 2-24523
(Seventh); 4(c)-9 in 2-26031 (Eighth); 2(a)-3 in 2-50438
(Ninth); 2(a)-3 in 2-62575 (Tenth); and A-2(b) to Rule 24
Certificate in 70-7262 (Eleventh)).
(g) 2 -- Mortgage and Deed of Trust, dated as of May 1,
1987, as amended by four Supplemental Indentures (A-2(c)
to Rule 24 Certificate in 70-7350 (Mortgage); A-5(b) to
Rule 24 Certificate in 70-7350 (First); A-4(b) to Rule 24
Certificate in 70-7448 (Second); 4(f)4 to Form 10-K for
the year ended December 31, 1992 in 0-5807 (Third); 4(a)
to Form 10-Q for the quarter ended September 30, 1993 in
0-5807 (Fourth); and 4(a) to Form 8-K dated April 26,
1995 in File No. 0-5807 (Fifth)).
(10) Material Contracts
Entergy Corporation
(a) 1 -- Agreement, dated April 23, 1982, among certain
System companies, relating to System Planning and
Development and Intra-System Transactions (10(a)1 to
Form 10-K for the year ended December 31, 1982, in
1-3517).
(a) 2 -- Middle South Utilities System Agency Agreement,
dated December 11, 1970 (5(a)-2 in 2-41080).
(a) 3 -- Amendment, dated February 10, 1971, to Middle
South Utilities System Agency Agreement, dated
December 11, 1970 (5(a)-4 in 2-41080).
(a) 4 -- Amendment, dated May 12, 1988, to Middle South
Utilities System Agency Agreement, dated December 11,
1970 (5(a)-4 in 2-41080).
(a) 5 -- Middle South Utilities System Agency Coordination
Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(a) 6 -- Service Agreement with Entergy Services, dated as
of April 1, 1963 (5(a)-5 in 2-41080).
(a) 7 -- Amendment, dated January 1, 1972, to Service
Agreement with Entergy Services (5(a)-6 in 2-43175).
(a) 8 -- Amendment, dated April 27, 1984, to Service
Agreement with Entergy Services (10(a)-7 to Form 10-K for
the year ended December 31, 1984, in 1-3517).
(a) 9 -- Amendment, dated August 1, 1988, to Service
Agreement with Entergy Services (10(a)-8 to Form 10-K for
the year ended December 31, 1988, in 1-3517).
(a) 10-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(a)-9 to Form 10-K for
the year ended December 31, 1990, in 1-3517).
(a) 11-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a)-11 for the year
ended December 31, 1994 in 1-3517).
(a) 12-- Availability Agreement, dated June 21, 1974, among
System Energy and certain other System companies (B to
Rule 24 Certificate, dated June 24, 1974, in 70-5399).
(a) 13-- First Amendment to Availability Agreement, dated
as of June 30, 1977 (B to Rule 24 Certificate, dated
June 24, 1977, in 70-5399).
(a) 14-- Second Amendment to Availability Agreement, dated
as of June 15, 1981 (E to Rule 24 Certificate, dated
July 1, 1981, in 70-6592).
(a) 15-- Third Amendment to Availability Agreement, dated
as of June 28, 1984 (B-13(a) to Rule 24 Certificate,
dated July 6, 1984, in 70-6985).
(a) 16-- Fourth Amendment to Availability Agreement, dated
as of June 1, 1989 (A to Rule 24 Certificate, dated
June 8, 1989, in 70-5399).
(a) 17-- Fifteenth Assignment of Availability Agreement,
Consent and Agreement, dated as of May 1, 1986, with
Deposit Guaranty National Bank, United States Trust
Company of New York and Malcolm J. Hood, as Trustees
(B-3(b) to Rule 24 Certificate, dated June 5, 1986, in
70-7158).
(a) 18-- Eighteenth Assignment of Availability Agreement,
Consent and Agreement, dated as of September 1, 1986,
with United States Trust Company of New York and
Gerard F. Ganey, as Trustees (C-2 to Rule 24 Certificate,
dated October 1, 1986, in 70-7272).
(a) 19-- Nineteenth Assignment of Availability Agreement,
Consent and Agreement, dated as of September 1, 1986,
with United States Trust Company of New York and
Gerard F. Ganey, as Trustees (C-3 to Rule 24
Certificate, dated October 1, 1986, in 70-7272).
(a) 20-- Twenty-sixth Assignment of Availability Agreement,
Consent and Agreement, dated as of October 1, 1992, with
United States Trust Company of New York and Gerard F.
Ganey, as Trustees (B-2(c) to Rule 24 Certificate, dated
November 2, 1992, in 70-7946).
(a) 21-- Twenty-seventh Assignment of Availability
Agreement, Consent and Agreement, dated as of April 1,
1993, with United States Trust Company of New York and
Gerard F. Ganey as Trustees (B-2(d) to Rule 24
Certificate dated May 4, 1993 in 70-7946).
(a) 22-- Twenty-eighth Assignment of Availability
Agreement, Consent and Agreement, dated as of December
17, 1993, with Chemical Bank, as Agent (B-2(a) to Rule 24
Certificate dated December 22, 1993 in 70-7561).
(a) 23-- Twenty-ninth Assignment of Availability Agreement,
Consent and Agreement, dated as of April 1, 1994, with
United States Trust Company of New York and Gerard F.
Ganey as Trustees (B-2(f) to Rule 24 Certificate dated
May 6, 1994, in 70-7946).
(a) 24-- Capital Funds Agreement, dated June 21, 1974,
between Entergy Corporation and System Energy (C to
Rule 24 Certificate, dated June 24, 1974, in 70-5399).
(a) 25-- First Amendment to Capital Funds Agreement, dated
as of June 1, 1989 (B to Rule 24 Certificate, dated
June 8, 1989, in 70-5399).
(a) 26-- Fifteenth Supplementary Capital Funds Agreement
and Assignment, dated as of May 1, 1986, with Deposit
Guaranty National Bank, United States Trust Company of
New York and Malcolm J. Hood, as Trustees (B-4(b) to
Rule 24 Certificate, dated June 5, 1986, in 70-7158).
(a) 27-- Eighteenth Supplementary Capital Funds Agreement
and Assignment, dated as of September 1, 1986, with
United States Trust Company of New York and Gerard F.
Ganey, as Trustees (D-2 to Rule 24 Certificate, dated
October 1, 1986, in 70-7272).
(a) 28-- Nineteenth Supplementary Capital Funds Agreement
and Assignment, dated as of September 1, 1986, with
United States Trust Company of New York and Gerard F.
Ganey, as Trustees (D-3 to Rule 24 Certificate, dated
October 1, 1986, in 70-7272).
(a) 29-- Twenty-sixth Supplementary Capital Funds Agreement
and Assignment, dated as of October 1, 1992, with United
States Trust Company of New York and Gerard F. Ganey, as
Trustees (B-3(c) to Rule 24 Certificate dated November 2,
1992 in 70-7946).
(a) 30-- Twenty-seventh Supplementary Capital Funds
Agreement and Assignment, dated as of April 1, 1993, with
United States Trust Company of New York and Gerard F.
Ganey, as Trustees (B-3(d) to Rule 24 Certificate dated
May 4, 1993 in 70-7946).
(a) 31-- Twenty-eighth Supplementary Capital Funds
Agreement and Assignment, dated as of December 17, 1993,
with Chemical Bank, as Agent (B-3(a) to Rule 24
Certificate dated December 22, 1993 in 70-7561).
(a) 32-- Twenty-ninth Supplementary Capital Funds Agreement
and Assignment, dated as of April 1, 1994, with United
States Trust Company of New York and Gerard F. Ganey, as
Trustees (B-3(f) to Rule 24 Certificate dated May 6,
1994, in 70-7946).
(a) 33-- First Amendment to Supplementary Capital Funds
Agreements and Assignments, dated as of June 1, 1989, by
and between Entergy Corporation, System Energy, Deposit
Guaranty National Bank, United States Trust Company of
New York and Gerard F. Ganey (C to Rule 24 Certificate,
dated June 8, 1989, in 70-7026).
(a) 34-- First Amendment to Supplementary Capital Funds
Agreements and Assignments, dated as of June 1, 1989, by
and between Entergy Corporation, System Energy, United
States Trust Company of New York and Gerard F. Ganey (C
to Rule 24 Certificate, dated June 8, 1989, in 70-7123).
(a) 35-- First Amendment to Supplementary Capital Funds
Agreement and Assignment, dated as of June 1, 1989, by
and between Entergy Corporation, System Energy and
Chemical Bank (C to Rule 24 Certificate, dated June 8,
1989, in 70-7561).
+(a) 36-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a)-42 to Form 10-K for the year ended
December 31, 1985, in 1-3517).
(a) 37-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
(a) 38-- Joint Construction, Acquisition and Ownership
Agreement, dated as of May 1, 1980, between System Energy
and SMEPA (B-1(a) in 70-6337), as amended by Amendment
No. 1, dated as of May 1, 1980 (B-1(c) in 70-6337) and
Amendment No. 2, dated as of October 31, 1980 (1 to Rule
24 Certificate, dated October 30, 1981, in 70-6337).
(a) 39-- Operating Agreement dated as of May 1, 1980,
between System Energy and SMEPA (B(2)(a) in 70-6337).
(a) 40-- Assignment, Assumption and Further Agreement
No. 1, dated as of December 1, 1988, among System Energy,
Meridian Trust Company and Stephen M. Carta, and SMEPA
(B-7(c)(1) to Rule 24 Certificate, dated January 9, 1989,
in 70-7561).
(a) 41-- Assignment, Assumption and Further Agreement
No. 2, dated as of December 1, 1988, among System Energy,
Meridian Trust Company and Stephen M. Carta, and SMEPA
(B-7(c)(2) to Rule 24 Certificate, dated January 9, 1989,
in 70-7561).
(a) 42-- Substitute Power Agreement, dated as of May 1,
1980, among MP&L, System Energy and SMEPA (B(3)(a) in
70-6337).
(a) 43-- Grand Gulf Unit No. 2 Supplementary Agreement,
dated as of February 7, 1986, between System Energy and
SMEPA (10(aaa) in 33-4033).
(a) 44-- Compromise and Settlement Agreement, dated June 4,
1982, between Texaco, Inc. and LP&L (28(a) to Form 8-K,
dated June 4, 1982, in 1-3517).
+(a) 45-- Post-Retirement Plan (10(a)37 to Form 10-K for the
year ended December 31, 1983, in 1-3517).
(a) 46-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L and
NOPSI (10(a)-39 to Form 10-K for the year ended December
31, 1982, in 1-3517).
(a) 47-- First Amendment to Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy and
AP&L, LP&L, MP&L and NOPSI (19 to Form 10-Q for the
quarter ended September 30, 1984, in 1-3517).
(a) 48-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(a) 49-- Middle South Utilities Inc. and Subsidiary
Companies Intercompany Income Tax Allocation Agreement,
dated April 28, 1988 (Exhibit D-1 to Form U5S for the
year ended December 31, 1987).
(a) 50-- First Amendment, dated January 1, 1990, to the
Middle South Utilities Inc. and Subsidiary Companies
Intercompany Income Tax Allocation Agreement (D-2 to
Form U5S for the year ended December 31, 1989).
(a) 51-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(a) 52-- Third Amendment dated January 1, 1994 to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
(a) 53-- Guaranty Agreement between Entergy Corporation and
AP&L, dated as of September 20, 1990 (B-1(a) to Rule 24
Certificate, dated September 27, 1990, in 70-7757).
(a) 54-- Guarantee Agreement between Entergy Corporation
and LP&L, dated as of September 20, 1990 (B-2(a) to Rule
24 Certificate, dated September 27, 1990, in 70-7757).
(a) 55-- Guarantee Agreement between Entergy Corporation
and System Energy, dated as of September 20, 1990 (B-3(a)
to Rule 24 Certificate, dated September 27, 1990, in 70-
7757).
(a) 56-- Loan Agreement between Entergy Operations and
Entergy Corporation, dated as of September 20, 1990
(B-12(b) to Rule 24 Certificate, dated June 15, 1990, in
70-7679).
(a) 57-- Loan Agreement between Entergy Power and Entergy
Corporation, dated as of August 28, 1990 (A-4(b) to Rule
24 Certificate, dated September 6, 1990, in 70-7684).
(a) 58-- Loan Agreement between Entergy Corporation and
Entergy Systems and Service, Inc., dated as of
December 29, 1992 (A-4(b) to Rule 24 Certificate in
70-7947).
+(a) 59-- Executive Financial Counseling Program of Entergy
Corporation and Subsidiaries (10(a) 52 to Form 10-K for
the year ended December 31, 1989, in 1-3517).
+(a) 60-- Entergy Corporation Annual Incentive Plan (10(a)
54 to Form 10-K for the year ended December 31, 1989, in
1-3517).
+(a) 61-- Equity Ownership Plan of Entergy Corporation and
Subsidiaries (A-4(a) to Rule 24 Certificate, dated May
24, 1991, in 70-7831).
+(a) 62-- Retired Outside Director Benefit Plan (10(a)63 to
Form 10-K for the year ended December 31, 1991, in
1-3517).
+(a) 63-- Agreement between Entergy Corporation and Jerry D.
Jackson. (10(a) 67 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(a) 64-- Agreement between Entergy Services, Inc., a
subsidiary of Entergy Corporation, and Gerald D. McInvale
(10(a) 68 to Form 10-K for the year ended December 31,
1992 in 1-3517).
+(a) 65-- Supplemental Retirement Plan (10(a) 69 to Form 10-
K for the year ended December 31, 1992 in 1-3517).
+(a) 66-- Defined Contribution Restoration Plan of Entergy
Corporation and Subsidiaries (10(a)53 to Form 10-K for
the year ended December 31, 1989 in 1-3517).
+(a) 67-- Amendment No. 1 to the Equity Ownership Plan of
Entergy Corporation and Subsidiaries (10(a) 71 to Form 10-
K for the year ended December 31, 1992 in 1-3517).
+(a) 68-- Executive Disability Plan of Entergy Corporation
and Subsidiaries (10(a) 72 to Form 10-K for the year
ended December 31, 1992 in 1-3517).
+(a) 69-- Executive Medical Plan of Entergy Corporation and
Subsidiaries (10(a) 73 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(a) 70-- Stock Plan for Outside Directors of Entergy
Corporation and Subsidiaries, as amended (10(a) 74 to
Form 10-K for the year ended December 31, 1992 in 1-
3517).
+(a) 71-- Summary Description of Private Ownership Vehicle
Plan of Entergy Corporation and Subsidiaries (10(a) 75 to
Form 10-K for the year ended December 31, 1992 in 1-
3517).
(a) 72-- Agreement and Plan of Reorganization Between
Entergy Corporation and Gulf States Utilities Company,
dated June 5, 1992 (1 to Current Report on Form 8-K dated
June 5, 1992 in 1-3517).
+(a) 73-- Amendment to Defined Contribution Restoration Plan
of Entergy Corporation and Subsidiaries (10(a) 81 to Form
10-K for the year ended December 31, 1993 in 1-11299).
+(a) 74-- System Executive Retirement Plan (10(a) 82 to Form
10-K for the year ended December 31, 1993 in 1-11299).
System Energy
(b) 1 through
(b) 12-- See 10(a)-12 through 10(a)-23 above.
(b) 13 through
(b) 24-- See 10(a)-24 through 10(a)-35 above.
(b) 25-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
(b) 26-- Joint Construction, Acquisition and Ownership
Agreement, dated as of May 1, 1980, between System Energy
and SMEPA (B-1(a) in 70-6337), as amended by Amendment
No. 1, dated as of May 1, 1980 (B-1(c) in 70-6337) and
Amendment No. 2, dated as of October 31, 1980 (1 to
Rule 24 Certificate, dated October 30, 1981, in 70-6337).
(b) 27-- Operating Agreement, dated as of May 1, 1980,
between System Energy and SMEPA (B(2)(a) in 70-6337).
(b) 28-- Installment Sale Agreement, dated as of
December 1, 1983 between System Energy and Claiborne
County, Mississippi (B-1 to First Rule 24 Certificate in
70-6913).
(b) 29-- Installment Sale Agreement, dated as of June 1,
1984, between System Energy and Claiborne County,
Mississippi (B-2 to Second Rule 24 Certificate in
70-6913).
(b) 30-- Installment Sale Agreement, dated as of
December 1, 1984, between System Energy and Claiborne
County, Mississippi (B-1 to First Rule 24 Certificate in
70-7026).
(b) 31-- Installment Sale Agreement, dated as of May 1,
1986, between System Energy and Claiborne County,
Mississippi (B-1(b) to Rule 24 Certificate in 70-7158).
(b) 32-- Amended and Restated Installment Sale Agreement,
dated as of May 1, 1995, between System Energy and
Claiborne County, Mississippi (B-6(a) to Rule 24
Certificate in 70-8511).
(b) 33-- Facility Lease No. 1, dated as of December 1,
1988, between Meridian Trust Company and Stephen M. Carta
(Stephen J. Kaba, successor), as Owner Trustees, and
System Energy (B-2(c)(1) to Rule 24 Certificate dated
January 9, 1989 in 70-7561), as supplemented by Lease
Supplement No. 1 dated as of April 1, 1989 (B-22(b) (1)
to Rule 24 Certificate dated April 21, 1989 in 70-7561)
and Lease Supplement No. 2 dated as of January 1, 1994 (B-
3(d) to Rule 24 Certificate dated January 31, 1994 in 70-
8215).
(b) 34-- Facility Lease No. 2, dated as of December 1, 1988
between Meridian Trust Company and Stephen M. Carta
(Stephen J. Kaba, successor), as Owner Trustees, and
System Energy (B-2(c)(2) to Rule 24 Certificate dated
January 9, 1989 in 70-7561), as supplemented by Lease
Supplement No. 1 dated as of April 1, 1989 (B-22(b) (2)
to Rule 24 Certificate dated April 21, 1989 in 70-7561)
and Lease Supplement No. 2 dated as of January 1, 1994 (B-
4(d) Rule 24 Certificate dated January 31, 1994 in 70-
8215).
(b) 35-- Assignment, Assumption and Further Agreement
No. 1, dated as of December 1, 1988, among System Energy,
Meridian Trust Company and Stephen M. Carta, and SMEPA
(B-7(c)(1) to Rule 24 Certificate, dated January 9, 1989,
in 70-7561).
(b) 36-- Assignment, Assumption and Further Agreement
No. 2, dated as of December 1, 1988, among System Energy,
Meridian Trust Company and Stephen M. Carta, and SMEPA
(B-7(c)(2) to Rule 24 Certificate, dated January 9, 1989,
in 70-7561).
(b) 37-- Collateral Trust Indenture, dated as of January 1,
1994, among System Energy, GG1B Funding Corporation and
Bankers Trust Company, as Trustee (A-3(e) to Rule 24
Certificate dated January 31, 1994, in 70-8215), as
supplemented by Supplemental Indenture No. 1 dated
January 1, 1994, (A-3(f) to Rule 24 Certificate dated
January 31, 1994, in 70-8215).
(b) 38-- Substitute Power Agreement, dated as of May 1,
1980, among MP&L, System Energy and SMEPA (B(3)(a) in
70-6337).
(b) 39-- Grand Gulf Unit No. 2 Supplementary Agreement,
dated as of February 7, 1986, between System Energy and
SMEPA (10(aaa) in 33-4033).
(b) 40-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L and
NOPSI (10(a)-39 to Form 10-K for the year ended
December 31, 1982, in 1-3517).
(b) 41-- First Amendment to the Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy and
AP&L, LP&L, MP&L and NOPSI (19 to Form 10-Q for the
quarter ended September 30, 1984, in 1-3517).
(b) 42-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(b) 43-- Fuel Lease, dated as of February 24, 1989, between
River Fuel Funding Company #3, Inc. and System Energy
(B-1(b) to Rule 24 Certificate, dated March 3, 1989, in
70-7604).
(b) 44-- System Energy's Consent, dated January 31, 1995,
pursuant to Fuel Lease, dated as of February 24, 1989,
between River Fuel Funding Company #3, Inc. and System
Energy (B-1(c) to Rule 24 Certificate, dated February 13,
1995 in 70-7604).
(b) 45-- Sales Agreement, dated as of June 21, 1974,
between System Energy and MP&L (D to Rule 24 Certificate,
dated June 26, 1974, in 70-5399).
(b) 46-- Service Agreement, dated as of June 21, 1974,
between System Energy and MP&L (E to Rule 24 Certificate,
dated June 26, 1974, in 70-5399).
(b) 47-- Partial Termination Agreement, dated as of
December 1, 1986, between System Energy and MP&L (A-2 to
Rule 24 Certificate, dated January 8, 1987, in 70-5399).
(b) 48-- Middle South Utilities, Inc. and Subsidiary
Companies Intercompany Income Tax Allocation Agreement,
dated April 28, 1988 (D-1 to Form U5S for the year ended
December 31, 1987).
(b) 49-- First Amendment, dated January 1, 1990 to the
Middle South Utilities Inc. and Subsidiary Companies
Intercompany Income Tax Allocation Agreement (D-2 to
Form U5S for the year ended December 31, 1989).
(b) 50-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(b) 51-- Third Amendment dated January 1, 1994 to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
(b) 52-- Service Agreement with Entergy Services, dated as
of July 16, 1974, as amended (10(b)-43 to Form 10-K for
the year ended December 31, 1988, in 1-9067).
(b) 53-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(b)-45 to Form 10-K
for the year ended December 31, 1990, in 1-9067).
(b) 54-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a) -11 to Form 10-K
for the year ended December 31, 1994 in 1-3517).
(b) 55-- Operating Agreement between Entergy Operations and
System Energy, dated as of June 6, 1990 (B-3(b) to Rule
24 Certificate, dated June 15, 1990, in 70-7679).
(b) 56-- Guarantee Agreement between Entergy Corporation
and System Energy, dated as of September 20, 1990 (B-3(a)
to Rule 24 Certificate, dated September 27, 1990, in
70-7757).
+(b) 57-- Agreement between System Energy and Donald C.
Hintz (10(b)47 to Form 10-K for the year ended
December 31, 1991, in 1-9067).
+(b) 58-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a)-42 to Form 10-K for the year ended
December 31, 1985 in 1-3517).
+(b) 59-- Agreement between Entergy Services and Gerald D.
McInvale (10(a)-69 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
AP&L
(c) 1 -- Agreement, dated April 23, 1982, among AP&L and
certain other System companies, relating to System
Planning and Development and Intra-System Transactions
(10(a) 1 to Form 10-K for the year ended December 31,
1982, in 1-3517).
(c) 2 -- Middle South Utilities System Agency Agreement,
dated December 11, 1970 (5(a)2 in 2-41080).
(c) 3 -- Amendment, dated February 10, 1971, to Middle
South Utilities System Agency Agreement, dated December
11, 1970 (5(a)-4 in 2-41080).
(c) 4 -- Amendment, dated May 12, 1988, to Middle South
Utilities System Agency Agreement, dated December 11,
1970 (5(a) 4 in 2-41080).
(c) 5 -- Middle South Utilities System Agency Coordination
Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(c) 6 -- Service Agreement with Entergy Services, dated as
of April 1, 1963 (5(a)-5 in 2-41080).
(c) 7 -- Amendment, dated January 1, 1972, to Service
Agreement with Entergy Services (5(a)- 6 in 2-43175).
(c) 8 -- Amendment, dated April 27, 1984, to Service
Agreement, with Entergy Services (10(a)- 7 to Form 10-K
for the year ended December 31, 1984, in 1-3517).
(c) 9 -- Amendment, dated August 1, 1988, to Service
Agreement with Entergy Services (10(c)- 8 to Form 10-K
for the year ended December 31, 1988, in 1-10764).
(c) 10-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(c)-9 to Form 10-K for
the year ended December 31, 1990, in 1-10764).
(c) 11-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a)-11 to Form 10-K
for the year ended December 31, 1994 in 1-3517).
(c) 12 through
(c) 23-- See 10(a)-12 through 10(a)-23 above.
(c) 24-- Agreement, dated August 20, 1954, between AP&L and
the United States of America (SPA)(13(h) in 2-11467).
(c) 25-- Amendment, dated April 19, 1955, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-2 in 2-41080).
(c) 26-- Amendment, dated January 3, 1964, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-3 in 2-41080).
(c) 27-- Amendment, dated September 5, 1968, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-4 in 2-41080).
(c) 28-- Amendment, dated November 19, 1970, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-5 in 2-41080).
(c) 29-- Amendment, dated July 18, 1961, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-6 in 2-41080).
(c) 30-- Amendment, dated December 27, 1961, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-7 in 2-41080).
(c) 31-- Amendment, dated January 25, 1968, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-8 in 2-41080).
(c) 32-- Amendment, dated October 14, 1971, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-9 in 2-43175).
(c) 33-- Amendment, dated January 10, 1977, to the United
States of America (SPA) Contract, dated August 20, 1954
(5(d)-10 in 2-60233).
(c) 34-- Agreement, dated May 14, 1971, between AP&L and
the United States of America (SPA) (5(e) in 2-41080).
(c) 35-- Amendment, dated January 10, 1977, to the United
States of America (SPA) Contract, dated May 14, 1971
(5(e)-1 in 2-60233).
(c) 36-- Contract, dated May 28, 1943, Amendment to
Contract, dated July 21, 1949, and Supplement to
Amendment to Contract, dated December 30, 1949, between
AP&L and McKamie Gas Cleaning Company; Agreements, dated
as of September 30, 1965, between AP&L and former
stockholders of McKamie Gas Cleaning Company; and Letter
Agreement, dated June 22, 1966, by Humble Oil & Refining
Company accepted by AP&L on June 24, 1966 (5(k)-7 in
2-41080).
(c) 37-- Agreement, dated April 3, 1972, between Entergy
Services and Gulf United Nuclear Fuels Corporation
(5(l)-3 in 2-46152).
(c) 38-- Fuel Lease, dated as of December 22, 1988, between
River Fuel Trust #1 and AP&L (B-1(b) to Rule 24
Certificate in 70-7571).
(c) 39-- White Bluff Operating Agreement, dated June 27,
1977, among AP&L and Arkansas Electric Cooperative
Corporation and City Water and Light Plant of the City of
Jonesboro, Arkansas (B-2(a) to Rule 24 Certificate, dated
June 30, 1977, in 70-6009).
(c) 40-- White Bluff Ownership Agreement, dated June 27,
1977, among AP&L and Arkansas Electric Cooperative
Corporation and City Water and Light Plant of the City of
Jonesboro, Arkansas (B-1(a) to Rule 24 Certificate, dated
June 30, 1977, in 70-6009).
(c) 41-- Agreement, dated June 29, 1979, between AP&L and
City of Conway, Arkansas (5(r)-3 in 2-66235).
(c) 42-- Transmission Agreement, dated August 2, 1977,
between AP&L and City Water and Light Plant of the City
of Jonesboro, Arkansas (5(r)-3 in 2-60233).
(c) 43-- Power Coordination, Interchange and Transmission
Service Agreement, dated as of June 27, 1977, between
Arkansas Electric Cooperative Corporation and AP&L
(5(r)-4 in 2-60233).
(c) 44-- Independence Steam Electric Station Operating
Agreement, dated July 31, 1979, among AP&L and Arkansas
Electric Cooperative Corporation and City Water and Light
Plant of the City of Jonesboro, Arkansas and City of
Conway, Arkansas (5(r)-6 in 2-66235).
(c) 45-- Amendment, dated December 4, 1984, to the
Independence Steam Electric Station Operating Agreement
(10(c) 51 to Form 10-K for the year ended December 31,
1984, in 1-10764).
(c) 46-- Independence Steam Electric Station Ownership
Agreement, dated July 31, 1979, among AP&L and Arkansas
Electric Cooperative Corporation and City Water and Light
Plant of the City of Jonesboro, Arkansas and City of
Conway, Arkansas (5(r)-7 in 2-66235).
(c) 47-- Amendment, dated December 28, 1979, to the
Independence Steam Electric Station Ownership Agreement
(5(r)-7(a) in 2-66235).
(c) 48-- Amendment, dated December 4, 1984, to the
Independence Steam Electric Station Ownership Agreement
(10(c) 54 to Form 10-K for the year ended December 31,
1984, in 1-10764).
(c) 49-- Owner's Agreement, dated November 28, 1984, among
AP&L, MP&L, other co-owners of the Independence Station
(10(c) 55 to Form 10-K for the year ended December 31,
1984, in 1-10764).
(c) 50-- Consent, Agreement and Assumption, dated December
4, 1984, among AP&L, MP&L, other co-owners of the
Independence Station and United States Trust Company of
New York, as Trustee (10(c) 56 to Form 10-K for the year
ended December 31, 1984, in 1-10764).
(c) 51-- Power Coordination, Interchange and Transmission
Service Agreement, dated as of July 31, 1979, between
AP&L and City Water and Light Plant of the City of
Jonesboro, Arkansas (5(r)-8 in 2-66235).
(c) 52-- Power Coordination, Interchange and Transmission
Agreement, dated as of June 29, 1979, between City of
Conway, Arkansas and AP&L (5(r)-9 in 2-66235).
(c) 53-- Agreement, dated June 21, 1979, between AP&L and
Reeves E. Ritchie ((10)(b)-90 to Form 10-K for the year
ended December 31, 1980, in 1-10764).
(c) 54-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
+(c) 55-- Post-Retirement Plan (10(b) 55 to Form 10-K for
the year ended December 31, 1983, in 1-10764).
(c) 56-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L, and
NOPSI (10(a) 39 to Form 10-K for the year ended December
31, 1982, in 1-3517).
(c) 57-- First Amendment to Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy, AP&L,
LP&L, MP&L, and NOPSI (19 to Form 10-Q for the quarter
ended September 30, 1984, in 1-3517).
(c) 58-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(c) 59-- Contract For Disposal of Spent Nuclear Fuel and/or
High-Level Radioactive Waste, dated June 30, 1983, among
the DOE, System Fuels and AP&L (10(b)-57 to Form 10-K for
the year ended December 31, 1983, in 1-10764).
(c) 60-- Middle South Utilities, Inc. and Subsidiary
Companies Intercompany Income Tax Allocation Agreement,
dated April 28, 1988 (D-1 to Form U5S for the year ended
December 31, 1987).
(c) 61-- First Amendment, dated January 1, 1990, to the
Middle South Utilities, Inc. and Subsidiary Companies
Intercompany Income Tax Allocation Agreement (D-2 to
Form U5S for the year ended December 31, 1989).
(c) 62-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(c) 63-- Third Amendment dated January 1, 1994, to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
(c) 64-- Assignment of Coal Supply Agreement, dated
December 1, 1987, between System Fuels and AP&L (B to
Rule 24 letter filing, dated November 10, 1987, in
70-5964).
(c) 65-- Coal Supply Agreement, dated December 22, 1976,
between System Fuels and Antelope Coal Company (B-1 in
70-5964), as amended by First Amendment (A to Rule 24
Certificate in 70-5964); Second Amendment (A to Rule 24
letter filing, dated December 16, 1983, in 70-5964); and
Third Amendment (A to Rule 24 letter filing, dated
November 10, 1987 in 70-5964).
(c) 66-- Operating Agreement between Entergy Operations and
AP&L, dated as of June 6, 1990 (B-1(b) to Rule 24
Certificate, dated June 15, 1990, in 70-7679).
(c) 67-- Guaranty Agreement between Entergy Corporation and
AP&L, dated as of September 20, 1990 (B-1(a) to Rule 24
Certificate, dated September 27, 1990, in 70-7757).
(c) 68-- Agreement for Purchase and Sale of Independence
Unit 2 between AP&L and Entergy Power, dated as of
August 28, 1990 (B-3(c) to Rule 24 Certificate, dated
September 6, 1990, in 70-7684).
(c) 69-- Agreement for Purchase and Sale of Ritchie Unit 2
between AP&L and Entergy Power, dated as of August 28,
1990 (B-4(d) to Rule 24 Certificate, dated September 6,
1990, in 70-7684).
(c) 70-- Ritchie Steam Electric Station Unit No. 2
Operating Agreement between AP&L and Entergy Power, dated
as of August 28, 1990 (B-5(a) to Rule 24 Certificate,
dated September 6, 1990, in 70-7684).
(c) 71-- Ritchie Steam Electric Station Unit No. 2
Ownership Agreement between AP&L and Entergy Power, dated
as of August 28, 1990 (B-6(a) to Rule 24 Certificate,
dated September 6, 1990, in 70-7684).
(c) 72-- Power Coordination, Interchange and Transmission
Service Agreement between Entergy Power and AP&L, dated
as of August 28, 1990 (10(c)-71 to Form 10-K for the year
ended December 31, 1990, in 1-10764).
+(c) 73-- Executive Financial Counseling Program of Entergy
Corporation and Subsidiaries (10(a)52 to Form 10-K for
the year ended December 31, 1989, in 1-3517).
+(c) 74-- Entergy Corporation Annual Incentive Plan (10(a)54
to Form 10-K for the year ended December 31, 1989, in
1-3517).
+(c) 75-- Equity Ownership Plan of Entergy Corporation and
Subsidiaries (A-4(a) to Rule 24 Certificate, dated
May 24, 1991, in 70-7831).
+(c) 76-- Agreement between Arkansas Power & Light Company
and R. Drake Keith. (10(c) 78 to Form 10-K for the year
ended December 31, 1992 in 1-10764).
+(c) 77-- Supplemental Retirement Plan (10(a)69 to Form 10-K
for the year ended December 31, 1992 in 1-3517).
+(c) 78-- Defined Contribution Restoration Plan of Entergy
Corporation and Subsidiaries (10(a)53 to Form 10-K for
the year ended December 31, 1989 in 1-3517).
+(c) 79-- Amendment No. 1 to the Equity Ownership Plan of
Entergy Corporation and Subsidiaries (10(a)71 to Form
10-K for the year ended December 31, 1992 in 1-3517).
+(c) 80-- Executive Disability Plan of Entergy Corporation
and Subsidiaries (10(a)72 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(c) 81-- Executive Medical Plan of Entergy Corporation and
Subsidiaries (10(a)73 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(c) 82-- Stock Plan for Outside Directors of Entergy
Corporation and Subsidiaries, as amended (10(a)74 to Form
10-K for the year ended December 31, 1992 in 1-3517).
+(c) 83-- Summary Description of Private Ownership Vehicle
Plan of Entergy Corporation and Subsidiaries (10(a)75 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(c) 84-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a)-42 to Form 10-K for the year ended
December 31, 1985 in 1-3517).
+(c) 85-- Agreement between Entergy Corporation and Jerry D.
Jackson (10(a)-68 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(c) 86-- Agreement between Entergy Services and Gerald D.
McInvale (10(a)-69 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(c) 87-- Agreement between System Energy and Donald C.
Hintz (10(b)-47 to Form 10-K for the year ended
December 31, 1991 in 1-9067).
+(c) 88-- Summary Description of Retired Outside Director
Benefit Plan. (10(c) 90 to Form 10-K for the year ended
December 31, 1992 in 1-10764).
+(c) 89-- Amendment to Defined Contribution Restoration Plan
of Entergy Corporation and Subsidiaries (10(a) 81 to Form
10-K for the year ended December 31, 1993 in 1-11299).
+(c) 90-- System Executive Retirement Plan (10(a) 82 to Form
10-K for the year ended December 31, 1993 in 1-11299).
(c) 91-- Loan Agreement dated June 15, 1993, between AP&L
and Independence Country, Arkansas (B-1 (a) to Rule 24
Certificate dated July 9, 1993 in 70-8171).
(c) 92-- Installment Sale Agreement dated January 1, 1991,
between AP&L and Pope Country, Arkansas (B-1 (b) to Rule
24 Certificate dated January 24, 1991 in 70-7802).
(c) 93-- Installment Sale Agreement dated November 1, 1990,
between AP&L and Pope Country, Arkansas (B-1 (a) to Rule
24 Certificate dated November 30, 1990 in70-7802).
(c) 94-- Loan Agreement dated June 15, 1994, between
AP&L and Jefferson County, Arkansas (B-1(a) to Rule 24
Certificate dated June 30, 1994 in 70-8405).
(c) 95-- Loan Agreement dated June 15, 1994, between
AP&L and Pope County, Arkansas (B-1(b) to Rule 24
Certificate in 70-8405).
*(c) 96-- Loan Agreement dated November 15, 1995,
between AP&L and Pope County, Arkansas.
GSU
(d) 1 -- Guaranty Agreement, dated July 1, 1976, between
GSU and American Bank and Trust Company (C and D to Form
8-K, dated August 6, 1976 in 1-2703).
(d) 2 -- Lease of Railroad Equipment, dated as of December
1, 1981, between The Connecticut Bank and Trust Company
as Lessor and GSU as Lessee and First Supplement, dated
as of December 31, 1981, relating to 605 One Hundred-Ton
Unit Train Steel Coal Porter Cars (4-12 to Form 10-K for
the year ended December 31, 1981 in 1-2703).
(d) 3 -- Guaranty Agreement, dated August 1, 1992, between
GSU and Hibernia National Bank, relating to Pollution
Control Revenue Refunding Bonds of the Industrial
Development Board of the Parish of Calcasieu, Inc.
(Louisiana) (10-1 to Form 10-K for the year ended
December 31, 1992 in 1-2703).
(d) 4 -- Guaranty Agreement, dated January 1, 1993, between
GSU and Hancock Bank of Louisiana, relating to Pollution
Control Revenue Refunding Bonds of the Parish of Pointe
Coupee (Louisiana) (10-2 to Form 10-K for the year ended
December 31, 1992 in 1-2703).
(d) 5 -- Deposit Agreement, dated as of December 1, 1983
between GSU, Morgan Guaranty Trust Co. as Depositary and
the Holders of Despositary Receipts, relating to the
Issue of 900,000 Depositary Preferred Shares, each
representing 1/2 share of Adjustable Rate Cumulative
Preferred Stock, Series E-$100 Par Value (4-17 to Form 10-
K for the year ended December 31, 1983 in 1-2703).
(d) 6 -- Letter of Credit and Reimbursement Agreement,
dated December 27, 1985, between GSU and Westpack Banking
Corporation relating to Variable Rate Demand Pollution
Control Revenue Bonds of the Parish of West Feliciana,
State of Louisiana, Series 1985-D (4-26 to Form 10-K for
the year ended December 31, 1985 in 1-2703) and Letter
Agreement amending same dated October 20, 1992 (10-3 to
Form 10-K for the year ended December 31, 1992 in 1-
2703).
(d) 7 -- Reimbursement and Loan Agreement, dated as of
April 23, 1986, by and between GSU and The Long-Term
Credit Bank of Japan, Ltd., relating to Multiple Rate
Demand Pollution Control Revenue Bonds of the Parish of
West Feliciana, State of Louisiana, Series 1985 (4-26 to
Form 10-K, for the year ended December 31, 1986 in 1-
2703) and Letter Agreement amending same, dated February
19, 1993 (10 to Form 10-K for the year ended December 31,
1992 in 1-2703).
(d) 8 -- Agreement effective February 1, 1964, between
Sabine River Authority, State of Louisiana, and Sabine
River Authority of Texas, and GSU, Central Louisiana
Electric Company, Inc., and Louisiana Power & Light
Company, as supplemented (B to Form 8-K, dated May 6,
1964, A to Form 8-K, dated October 5, 1967, A to Form 8-
K, dated May 5, 1969, and A to Form 8-K, dated December
1, 1969, in 1-2708).
(d) 9 -- Joint Ownership Participation and Operating
Agreement regarding River Bend Unit 1 Nuclear Plant,
dated August 20, 1979, between GSU, Cajun, and SRG&T;
Power Interconnection Agreement with Cajun, dated June
26, 1978, and approved by the REA on August 16, 1979,
between GSU and Cajun; and Letter Agreement regarding
CEPCO buybacks, dated August 28, 1979, between GSU and
Cajun (2, 3, and 4, respectively, to Form 8-K, dated
September 7, 1979, in 1-2703).
(d) 10-- Ground Lease, dated August 15, 1980, between
Statmont Associates Limited Partnership (Statmont) and
GSU, as amended (3 to Form 8-K, dated August 19, 1980,
and A-3-b to Form 10-Q for the quarter ended September
30, 1983 in 1-2703).
(d) 11-- Lease and Sublease Agreement, dated August 15,
1980, between Statmont and GSU, as amended (4 to Form 8-
K, dated August 19, 1980, and A-3-c to Form 10-Q for the
quarter ended September 30, 1983 in 1-2703).
(d) 12-- Lease Agreement, dated September 18, 1980, between
BLC Corporation and GSU (1 to Form 8-K, dated October 6,
1980 in 1-2703).
(d) 13-- Joint Ownership Participation and Operating
Agreement for Big Cajun, between GSU, Cajun Electric
Power Cooperative, Inc., and Sam Rayburn G&T, Inc, dated
November 14, 1980 (6 to Form 8-K, dated January 29, 1981
in 1-2703); Amendment No. 1, dated December 12, 1980 (7
to Form 8-K, dated January 29, 1981 in 1-2703); Amendment
No. 2, dated December 29, 1980 (8 to Form 8-K, dated
January 29, 1981 in 1-2703).
(d) 14-- Agreement of Joint Ownership Participation between
SRMPA, SRG&T and GSU, dated June 6, 1980, for Nelson
Station, Coal Unit #6, as amended (8 to Form 8-K, dated
June 11, 1980, A-2-b to Form 10-Q For the quarter ended
June 30, 1982; and 10-1 to Form 8-K, dated February 19,
1988 in 1-2703).
(d) 15-- Agreements between Southern Company and GSU, dated
February 25, 1982, which cover the construction of a 140-
mile transmission line to connect the two systems,
purchase of power and use of transmission facilities (10-
31 to Form 10-K, for the year ended December 31, 1981 in
1-2703).
+(d) 16-- Executive Income Security Plan, effective October
1, 1980, as amended, continued and completely restated
effective as of March 1, 1991 (10-2 to Form 10-K for the
year ended December 31, 1991 in 1-2703).
(d) 17-- Transmission Facilities Agreement between GSU and
Mississippi Power Company, dated February 28, 1982, and
Amendment, dated May 12, 1982 (A-2-c to Form 10-Q for the
quarter ended March 31, 1982 in 1-2703) and Amendment,
dated December 6, 1983 (10-43 to Form 10-K, for the year
ended December 31, 1983 in 1-2703).
(d) 18-- Lease Agreement dated as of June 29, 1983, between
GSU and City National Bank of Baton Rouge, as Owner
Trustee, in connection with the leasing of a Simulator
and Training Center for River Bend Unit 1 (A-2-a to Form
10-Q for the quarter ended June 30, 1983 in 1-2703) and
Amendment, dated December 14, 1984 (10-55 to Form 10-K,
for the year ended December 31, 1984 in 1-2703).
(d) 19-- Participation Agreement, dated as of June 29,
1983, among GSU, City National Bank of Baton Rouge,
PruFunding, Inc. Bank of the Southwest National
Association, Houston and Bankers Life Company, in
connection with the leasing of a Simulator and Training
Center of River Bend Unit 1 (A-2-b to Form 10-Q for the
quarter ended June 30, 1983 in 1-2703).
(d) 20-- Tax Indemnity Agreement, dated as of June 29,
1983, between GSU and Prufunding, Inc., in connection
with the leasing of a Simulator and Training Center for
River Bend Unit I (A-2-c to Form 10-Q for the quarter
ended June 30, 1993 in 1-2703).
(d) 21-- Agreement to Lease, dated as of August 28, 1985,
among GSU, City National Bank of Baton Rouge, as Owner
Trustee, and Prudential Interfunding Corp., as Trustor,
in connection with the leasing of improvement to a
Simulator and Training Facility for River Bend Unit I (10-
69 to Form 10-K, for the year ended December 31, 1985 in
1-2703).
(d) 22-- First Amended Power Sales Agreement, dated
December 1, 1985 between Sabine River Authority, State of
Louisiana, and Sabine River Authority, State of Texas,
and GSU, Central Louisiana Electric Co., Inc., and
Louisiana Power and Light Company (10-72 to Form 10-K for
the year ended December 31, 1985 in 1-2703).
+(d) 23-- Deferred Compensation Plan for Directors of GSU
and Varibus Corporation, as amended January 8, 1987, and
effective January 1, 1987 (10-77 to Form 10-K for the
year ended December 31, 1986 in 1-2703). Amendment dated
December 4, 1991 (10-3 to Amendment No. 8 in Registration
No. 2-76551).
+(d) 24-- Trust Agreement for Deferred Payments to be made
by GSU pursuant to the Executive Income Security Plan, by
and between GSU and Bankers Trust Company, effective
November 1, 1986 (10-78 to Form 10-K for the year ended
December 31, 1986 in 1-2703).
+(d) 25-- Trust Agreement for Deferred Installments under
GSU's Management Incentive Compensation Plan and
Administrative Guidelines by and between GSU and Bankers
Trust Company, effective June 1, 1986 (10-79 to Form 10-K
for the year ended December 31, 1986 in 1-2703).
+(d) 26-- Nonqualified Deferred Compensation Plan for
Officers, Nonemployee Directors and Designated Key
Employees, effective December 1, 1985, as amended,
continued and completely restated effective as of March
1, 1991 (10-3 to Amendment No. 8 in Registration No. 2-
76551).
+(d) 27-- Trust Agreement for GSU's Nonqualified Directors
and Designated Key Employees by and between GSU and First
City Bank, Texas-Beaumont, N.A. (now Texas Commerce
Bank), effective July 1, 1991 (10-4 to Form 10-K for the
year ended December 31, 1992 in 1-2703).
(d) 28-- Lease Agreement, dated as of June 29, 1987, among
GSG&T, Inc., and GSU related to the leaseback of the
Lewis Creek generating station (10-83 to Form 10-K for
the year ended December 31, 1988 in 1-2703).
(d) 29-- Nuclear Fuel Lease Agreement between GSU and River
Bend Fuel Services, Inc. to lease the fuel for River Bend
Unit 1, dated February 7, 1989 (10-64 to Form 10-K for
the year ended December 31, 1988 in 1-2703).
(d) 30-- Trust and Investment Management Agreement between
GSU and Morgan Guaranty and Trust Company of New York
(the "Decommissioning Trust Agreement) with respect to
decommissioning funds authorized to be collected by GSU,
dated March 15, 1989 (10-66 to Form 10-K for the year
ended December 31, 1988 in 1-2703).
*(d) 31-- Amendment No. 2 dated November 1, 1995 between GSU
and Mellon Bank to Decommissioning Trust Agreement.
(d) 32-- Credit Agreement, dated as of December 29, 1993,
among River Bend Fuel Services, Inc. and Certain
Commercial Lending Institutions and CIBC Inc. as Agent
for the Lenders ((d) 34 to Form 10-K for year ended
December 31, 1994).
*(d) 33-- Amendment No. 1 dated as of January 31, 1996 to
Credit Agreement, dated as of December 31, 1993, among
River Bend Fuel Services, Inc. and certain commercial
lending institutions and CIBC Inc. as agent for Lenders.
(d) 34-- Partnership Agreement by and among Conoco Inc.,
and GSU, CITGO Petroleum Corporation and Vista Chemical
Company, dated April 28, 1988 (10-67 to Form 10-K for the
year ended December 31, 1988 in 1-2703).
+(d) 35-- Gulf States Utilities Company Executive Continuity
Plan, dated January 18, 1991 (10-6 to Form 10-K for the
year ended December 31, 1990 in 1-2703).
+(d) 36-- Trust Agreement for GSU's Executive Continuity
Plan, by and between GSU and First City Bank, Texas-
Beaumont, N.A. (now Texas Commerce Bank), effective May
20, 1991 (10-5 to Form 10-K for the year ended December
31, 1992 in 1-2703).
+(d) 37-- Gulf States Utilities Board of Directors'
Retirement Plan, dated February 15, 1991 (10-8 to Form 10-
K for the year ended December 31, 1990 in 1-2703).
+(d) 38-- Gulf States Utilities Company Employees' Trustee
Retirement Plan effective July 1, 1955 as amended,
continued and completely restated effective January 1,
1989; and Amendment No.1 effective January 1, 1993 (10-6
to Form 10-K for the year ended December 31, 1992 in 1-
2703).
(d) 39-- Agreement and Plan of Reorganization, dated June
5, 1992, between GSU and Entergy Corporation (2 to Form 8-
K, dated June 8, 1992 in 1-2703).
+(d) 40-- Gulf States Utilities Company Employee Stock
Ownership Plan, as amended, continued, and completely
restated effective January 1, 1984, and January 1, 1985
(A to Form 11-K, dated December 31, 1985 in 1-2703).
+(d) 41-- Trust Agreement under the Gulf States Utilities
Company Employee Stock Ownership Plan, dated December 30,
1976, between GSU and the Louisiana National Bank, as
Trustee (2-A to Registration No. 2-62395).
+(d) 42-- Letter Agreement dated September 7, 1977 between
GSU and the Trustee, delegating certain of the Trustee's
functions to the ESOP Committee (2-B to Registration
Statement No. 2-62395).
+(d) 43-- Gulf States Utilities Company Employees Thrift
Plan as amended, continued and completely restated
effective as of January 1, 1992 (28-1 to Amendment No. 8
to Registration No. 2-76551).
+(d) 44-- Restatement of Trust Agreement under the Gulf
States Utilities Company Employees Thrift Plan,
reflecting changes made through January 1, 1989, between
GSU and First City Bank, Texas-Beaumont, N.A., (now Texas
Commerce Bank ), as Trustee (2-A to Form 8-K dated
October 20, 1989 in 1-2703).
(d) 45-- Operating Agreement between Entergy Operations and
GSU, dated as of December 31, 1993 (B-2(f) to Rule 24
Certificate in 70-8059).
(d) 46-- Guarantee Agreement between Entergy Corporation
and GSU, dated as of December 31, 1993 (B-5(a) to Rule 24
Certificate in 70-8059).
(d) 47-- Service Agreement with Entergy Services, dated as
of December 31, 1993 (B-6(c) to Rule 24 Certificate in
70-8059).
+(d) 48-- Amendment to Employment Agreement between J. L.
Donnelly and GSU, dated December 22, 1993 (10(d) 57 to
Form 10-K for the year ended December 31, 1993 in 1-
2703).
(d) 49-- Assignment, Assumption and Amendment Agreement to
Letter of Credit and Reimbursement Agreement between GSU,
Canadian Imperial Bank of Commerce and Westpac Banking
Corporation (10(d) 58 to Form 10-K for the year ended
December 31, 1993 in 1-2703).
(d) 50-- Third Amendment, dated January 1, 1994, to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
(d) 51-- Refunding Agreement between GSU and West Feliciana
Parish (dated December 20, 1994 (B-12(a) to Rule 24
Certificate dated December 30, 1994 in 70-8375).
LP&L
(e) 1 -- Agreement, dated April 23, 1982, among LP&L and
certain other System companies, relating to System
Planning and Development and Intra-System Transactions
(10(a) 1 to Form 10-K for the year ended December 31,
1982, in 1-3517).
(e) 2 -- Middle South Utilities System Agency Agreement,
dated December 11, 1970 (5(a)-2 in 2-41080).
(e) 3 -- Amendment, dated as of February 10, 1971, to
Middle South Utilities System Agency Agreement, dated
December 11, 1970 (5(a)-4 in 2-41080).
(e) 4 -- Amendment, dated May 12, 1988, to Middle South
Utilities System Agency Agreement, dated December 11,
1970 (5(a) 4 in 2-41080).
(e) 5 -- Middle South Utilities System Agency Coordination
Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(e) 6 -- Service Agreement with Entergy Services, dated as
of April 1, 1963 (5(a)-5 in 2-42523).
(e) 7 -- Amendment, dated as of January 1, 1972, to Service
Agreement with Entergy Services (4(a)-6 in 2-45916).
(e) 8 -- Amendment, dated as of April 27, 1984, to Service
Agreement with Entergy Services (10(a) 7 to Form 10-K for
the year ended December 31, 1984, in 1-3517).
(e) 9 -- Amendment, dated as of August 1, 1988, to Service
Agreement with Entergy Services (10(d)-8 to Form 10-K for
the year ended December 31, 1988, in 1-8474).
(e) 10-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(d)-9 to Form 10-K for
the year ended December 31, 1990, in 1-8474).
(e) 11-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a)-11 to Form 10-K
for the year ended December 31, 1994 in 1-3517).
(e) 12 through
(e) 23-- See 10(a)-12 through 10(a)-23 above.
(e) 24-- Fuel Lease, dated as of January 31, 1989, between
River Fuel Company #2, Inc., and LP&L (B-1(b) to Rule 24
Certificate in 70-7580).
(e) 25-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
(e) 26-- Compromise and Settlement Agreement, dated June 4,
1982, between Texaco, Inc. and LP&L (28(a) to Form 8-K,
dated June 4, 1982, in 1-8474).
+(e) 27-- Post-Retirement Plan (10(c)23 to Form 10-K for the
year ended December 31, 1983, in 1-8474).
(e) 28-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L and
NOPSI (10(a) 39 to Form 10-K for the year ended December
31, 1982, in 1-3517).
(e) 29-- First Amendment to the Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy and
AP&L, LP&L, MP&L and NOPSI (19 to Form 10-Q for the
quarter ended September 30, 1984, in 1-3517).
(e) 30-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(e) 31-- Middle South Utilities, Inc. and Subsidiary
Companies Intercompany Tax Allocation Agreement, dated
April 28, 1988 (D-1 to Form U5S for the year ended
December 31, 1987).
(e) 32-- First Amendment, dated January 1, 1990, to the
Middle South Utilities, Inc. and Subsidiary Companies
Intercompany Income Tax Allocation Agreement, dated
January 1, 1990 (D-2 to Form U5S for the year ended
December 31, 1989).
(e) 33-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(e) 34-- Third Amendment dated January 1, 1994 to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
(e) 35-- Contract for Disposal of Spent Nuclear Fuel and/or
High-Level Radioactive Waste, dated February 2, 1984,
among DOE, System Fuels and LP&L (10(d)33 to Form 10-K
for the year ended December 31, 1984, in 1-8474).
(e) 36-- Operating Agreement between Entergy Operations and
LP&L, dated as of June 6, 1990 (B-2(c) to Rule 24
Certificate, dated June 15, 1990, in 70-7679).
(e) 37-- Guarantee Agreement between Entergy Corporation
and LP&L, dated as of September 20, 1990 (B-2(a), to
Rule 24 Certificate, dated September 27, 1990, in
70-7757).
+(e) 38-- Executive Financial Counseling Program of Entergy
Corporation and Subsidiaries (10(a) 52 to Form 10-K for
the year ended December 31, 1989, in 1-3517).
+(e) 39-- Entergy Corporation Annual Incentive Plan (10(a)
54 to Form 10-K for the year ended December 31, 1989, in
1-3517).
+(e) 40-- Equity Ownership Plan of Entergy Corporation and
Subsidiaries (A-4(a) to Rule 24 Certificate, dated
May 24, 1991, in 70-7831).
+(e) 41-- Supplemental Retirement Plan (10(a) 69 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(e) 42-- Defined Contribution Restoration Plan of Entergy
Corporation and Subsidiaries (10(a) 53 to Form 10-K for
the year ended December 31, 1989 in 1-3517).
+(e) 43-- Amendment No. 1 to the Equity Ownership Plan of
Entergy Corporation and Subsidiaries (10(a) 71 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(e) 44-- Executive Disability Plan of Entergy Corporation
and Subsidiaries (10(a) 72 to Form 10-K for the year
ended December 31, 1992 in 1-3517).
+(e) 45-- Executive Medical Plan of Entergy Corporation and
Subsidiaries (10(a) 73 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(e) 46-- Stock Plan for Outside Directors of Entergy
Corporation and Subsidiaries (10(a) 74 to Form 10-K for
the year ended December 31, 1992 in 1-3517).
+(e) 47-- Summary Description of Private Ownership Vehicle
Plan of Entergy Corporation and Subsidiaries (10(a) 75 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(e) 48-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a) 42 to Form 10-K for the year ended
December 31, 1985 in 1-3517).
+(e) 49-- Agreement between Entergy Corporation and Jerry D.
Jackson (10(a) 68 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(e) 50-- Agreement between Entergy Services and Gerald D.
McInvale (10(a) 69 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(e) 51-- Agreement between System Energy and Donald C.
Hintz (10(b) 47 to Form 10-K for the year ended
December 31, 1991 in 1-9067).
+(e) 52-- Summary Description of Retired Outside Director
Benefit Plan (10(c)90 to Form 10-K for the year ended
December 31, 1992 in 1-10764).
+(e) 53-- Amendment to Defined Contribution Restoration Plan
of Entergy Corporation and Subsidiaries (10(a) 81 to Form
10-K for the year ended December 31, 1993 in 1-11299).
+(e) 54-- System Executive Retirement Plan (10(a) 82 to Form
10-K for the year ended December 31, 1993 in 1-11299).
(e) 55-- Installment Sale Agreement, dated July 20, 1994,
between LP&L and St. Charles Parish, Louisiana (B-6(e) to
Rule 24 Certificate dated August 1, 1994 in 70-7822).
(e) 56-- Installment Sale Agreement, dated November 1,
1995, between LP&L and St. Charles Parish, Louisiana (B-
6(a) to Rule 24 Certificate dated December 19, 1995 in 70-
8487).
MP&L
(f) 1 -- Agreement dated April 23, 1982, among MP&L and
certain other System companies, relating to System
Planning and Development and Intra-System Transactions
(10(a) 1 to Form 10-K for the year ended December 31,
1982, in 1-3517).
(f) 2 -- Middle South Utilities System Agency Agreement,
dated December 11, 1970 (5(a)-2 in 2-41080).
(f) 3 -- Amendment, dated February 10, 1971, to Middle
South Utilities System Agency Agreement, dated December
11, 1970 (5(a) 4 in 2-41080).
(f) 4 -- Amendment, dated May 12, 1988, to Middle South
Utilities System Agency Agreement, dated December 11,
1970 (5(a) 4 in 2-41080).
(f) 5 -- Middle South Utilities System Agency Coordination
Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(f) 6 -- Service Agreement with Entergy Services, dated as
of April 1, 1963 (D in 37-63).
(f) 7 -- Amendment, dated January 1, 1972, to Service
Agreement with Entergy Services (A to Notice, dated
October 14, 1971, in 37-63).
(f) 8 -- Amendment, dated April 27, 1984, to Service
Agreement with Entergy Services (10(a) 7 to Form 10-K for
the year ended December 31, 1984, in 1-3517).
(f) 9 -- Amendment, dated as of August 1, 1988, to Service
Agreement with Entergy Services (10(e) 8 to Form 10-K for
the year ended December 31, 1988, in 0-320).
(f) 10-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(e) 9 to Form 10-K for
the year ended December 31, 1990, in 0-320).
(f) 11-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a)-11 to Form 10-K
for the year ended December 31, 1994 in 1-3517).
(f) 12 though
(f) 23-- See 10(a)-12 - 10(a)-23 above.
(f) 24-- Installment Sale Agreement, dated as of June 1,
1974, between MP&L and Washington County, Mississippi (B-
2(a) to Rule 24 Certificate, dated August 1, 1974, in 70-
5504).
(f) 25-- Installment Sale Agreement, dated as of July 1,
1982, between MP&L and Independence County, Arkansas, (B-
1(c) to Rule 24 Certificate dated July 21, 1982, in 70-
6672).
(f) 26-- Installment Sale Agreement, dated as of December
1, 1982, between MP&L and Independence County, Arkansas,
(B-1(d) to Rule 24 Certificate dated December 7, 1982, in
70-6672).
(f) 27-- Amended and Restated Installment Sale Agreement,
dated as of April 1, 1994, between MP&L and Warren
County, Mississippi, (B-6(a) to Rule 24 Certificate dated
May 4, 1994, in 70-7914).
(f) 28-- Amended and Restated Installment Sale Agreement,
dated as of April 1, 1994, between MP&L and Washington
County, Mississippi, (B-6(b) to Rule 24 Certificate dated
May 4, 1994, in 70-7914).
(f) 29-- Substitute Power Agreement, dated as of May 1,
1980, among MP&L, System Energy and SMEPA (B-3(a) in
70-6337).
(f) 30-- Amendment, dated December 4, 1984, to the
Independence Steam Electric Station Operating Agreement
(10(c) 51 to Form 10-K for the year ended December 31,
1984, in 0-375).
(f) 31-- Amendment, dated December 4, 1984, to the
Independence Steam Electric Station Ownership Agreement
(10(c) 54 to Form 10-K for the year ended December 31,
1984, in 0-375).
(f) 32-- Owners Agreement, dated November 28, 1984, among
AP&L, MP&L and other co- owners of the Independence
Station (10(c) 55 to Form 10-K for the year ended
December 31, 1984, in 0-375).
(f) 33-- Consent, Agreement and Assumption, dated December
4, 1984, among AP&L, MP&L, other co-owners of the
Independence Station and United States Trust Company of
New York, as Trustee (10(c) 56 to Form 10-K for the year
ended December 31, 1984, in 0-375).
(f) 34-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
+(f) 35-- Post-Retirement Plan (10(d) 24 to Form 10-K for
the year ended December 31, 1983, in 0-320).
(f) 36-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L, and
NOPSI (10(a) 39 to Form 10-K for the year ended December
31, 1982, in 1-3517).
(f) 37-- First Amendment to the Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy and
AP&L, LP&L, MP&L, and NOPSI (19 to Form 10-Q for the
quarter ended September 30, 1984, in 1-3517).
(f) 38-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(f) 39-- Sales Agreement, dated as of June 21, 1974,
between System Energy and MP&L (D to Rule 24 Certificate,
dated June 26, 1974, in 70-5399).
(f) 40-- Service Agreement, dated as of June 21, 1974,
between System Energy and MP&L (E to Rule 24 Certificate,
dated June 26, 1974, in 70-5399).
(f) 41-- Partial Termination Agreement, dated as of
December 1, 1986, between System Energy and MP&L (A-2 to
Rule 24 Certificate dated January 8, 1987, in 70-5399).
(f) 42-- Middle South Utilities, Inc. and Subsidiary
Companies Intercompany Income Tax Allocation Agreement,
dated April 28, 1988 (D-1 to Form U5S for the year ended
December 31, 1987).
(f) 43-- First Amendment dated January 1, 1990 to the
Middle South Utilities Inc. and Subsidiary Companies
Intercompany Tax Allocation Agreement (D-2 to Form U5S
for the year ended December 31, 1989).
(f) 44-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(f) 45-- Third Amendment dated January 1, 1994 to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
+(f) 46-- Executive Financial Counseling Program of Entergy
Corporation and Subsidiaries (10(a) 52 to Form 10-K for
the year ended December 31, 1989, in 1-3517).
+(f) 47-- Entergy Corporation Annual Incentive Plan (10(a)
54 to Form 10-K for the year ended December 31, 1989, in
1-3517).
+(f) 48-- Equity Ownership Plan of Entergy Corporation and
Subsidiaries (A-4(a) to Rule 24 Certificate, dated
May 24, 1991, in 70-7831).
+(f) 49-- Supplemental Retirement Plan (10(a)69 to Form 10-K
for the year ended December 31, 1992 in 1-3517).
+(f) 50-- Defined Contribution Restoration Plan of Entergy
Corporation and Subsidiaries (10(a)53 to Form 10-K for
the year ended December 31, 1989 in 1-3517).
+(f) 51-- Amendment No. 1 to the Equity Ownership Plan of
Entergy Corporation and Subsidiaries (10(a)71 to Form
10-K for the year ended December 31, 1992 in 1-3517).
+(f) 52-- Executive Disability Plan of Entergy Corporation
and Subsidiaries (10(a)72 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(f) 53-- Executive Medical Plan of Entergy Corporation and
Subsidiaries (10(a)73 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(f) 54-- Stock Plan for Outside Directors of Entergy
Corporation and Subsidiaries, as amended (10(a)74 to Form
10-K for the year ended December 31, 1992 in 1-3517).
+(f) 55-- Summary Description of Private Ownership Vehicle
Plan of Entergy Corporation and Subsidiaries (10(a)75 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(f) 56-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a)-42 to Form 10-K for the year ended
December 31, 1985 in 1-3517).
+(f) 57-- Agreement between Entergy Corporation and Jerry D.
Jackson (10(a)-68 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(f) 58-- Agreement between Entergy Services and Gerald D.
McInvale (10(a)-69 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(f) 59-- Agreement between System Energy and Donald C.
Hintz (10(b)-47 to Form 10-K for the year ended
December 31, 1991 in 1-9067).
+(f) 60-- Summary Description of Retired Outside Director
Benefit Plan (10(c)-90 to Form 10-K for the year ended
December 31, 1992 in 1-10764).
+(f) 61-- Amendment to Defined Contribution Restoration Plan
of Entergy Corporation and Subsidiaries (10(a) 81 to Form
10-K for the year ended December 31, 1993 in 1-11299).
+(f) 62-- System Executive Retirement Plan (10(a) 82 to Form
10-K for the year ended December 31, 1993 in 1-11299).
NOPSI
(g) 1 -- Agreement, dated April 23, 1982, among NOPSI and
certain other System companies, relating to System
Planning and Development and Intra-System Transactions
(10(a)-1 to Form 10-K for the year ended December 31,
1982, in 1-3517).
(g) 2 -- Middle South Utilities System Agency Agreement,
dated December 11, 1970 (5(a)-2 in 2-41080).
(g) 3 -- Amendment dated as of February 10, 1971, to Middle
South Utilities System Agency Agreement, dated December
11, 1970 (5(a)-4 in 2-41080).
(g) 4 -- Amendment, dated May 12, 1988, to Middle South
Utilities System Agency Agreement, dated December 11,
1970 (5(a) 4 in 2-41080).
(g) 5 -- Middle South Utilities System Agency Coordination
Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(g) 6 -- Service Agreement with Entergy Services dated as
of April 1, 1963 (5(a)-5 in 2-42523).
(g) 7 -- Amendment, dated as of January 1, 1972, to Service
Agreement with Entergy Services (4(a)-6 in 2-45916).
(g) 8 -- Amendment, dated as of April 27, 1984, to Service
Agreement with Entergy Services (10(a)7 to Form 10-K for
the year ended December 31, 1984, in 1-3517).
(g) 9 -- Amendment, dated as of August 1, 1988, to Service
Agreement with Entergy Services (10(f)-8 to Form 10-K for
the year ended December 31, 1988, in 0-5807).
(g) 10-- Amendment, dated January 1, 1991, to Service
Agreement with Entergy Services (10(f)-9 to Form 10-K for
the year ended December 31, 1990, in 0-5807).
(g) 11-- Amendment, dated January 1, 1992, to Service
Agreement with Entergy Services (10(a)-11 to Form 10-K
for year ended December 31, 1994 in 1-3517).
(g) 12
(g) 23-- See 10(a)-12 - 10(a)-23 above.
(g) 24-- Reallocation Agreement, dated as of July 28, 1981,
among System Energy and certain other System companies
(B-1(a) in 70-6624).
+(g) 25-- Post-Retirement Plan (10(e) 22 to Form 10-K for
the year ended December 31, 1983, in 1-1319).
(g) 26-- Unit Power Sales Agreement, dated as of June 10,
1982, between System Energy and AP&L, LP&L, MP&L and
NOPSI (10(a) 39 to Form 10-K for the year ended December
31, 1982, in 1-3517).
(g) 27-- First Amendment to the Unit Power Sales Agreement,
dated as of June 28, 1984, between System Energy and
AP&L, LP&L, MP&L and NOPSI (19 to Form 10-Q for the
quarter ended September 30, 1984, in 1-3517).
(g) 28-- Revised Unit Power Sales Agreement (10(ss) in
33-4033).
(g) 29-- Transfer Agreement, dated as of June 28, 1983,
among the City of New Orleans, NOPSI and Regional Transit
Authority (2(a) to Form 8-K, dated June 24, 1983, in
1-1319).
(g) 30-- Middle South Utilities, Inc. and Subsidiary
Companies Intercompany Income Tax Allocation Agreement,
dated April 28, 1988 (D-1 to Form U5S for the year ended
December 31, 1987).
(g) 31-- First Amendment, dated January 1, 1990, to the
Middle South Utilities, Inc. and Subsidiary Companies
Intercompany Income Tax Allocation Agreement (D-2 to
Form U5S for the year ended December 31, 1989).
(g) 32-- Second Amendment dated January 1, 1992, to the
Entergy Corporation and Subsidiary Companies Intercompany
Income Tax Allocation Agreement (D-3 to Form U5S for the
year ended December 31, 1992).
(g) 33-- Third Amendment dated January 1, 1994 to Entergy
Corporation and Subsidiary Companies Intercompany Income
Tax Allocation Agreement (D-3(a) to Form U5S for the year
ended December 31, 1993).
+(g) 34-- Executive Financial Counseling Program of Entergy
Corporation and Subsidiaries (10(a)52 to Form 10-K for
the year ended December 31, 1989, in 1-3517).
+(g) 35-- Entergy Corporation Annual Incentive Plan (10(a)54
to Form 10-K for the year ended December 31, 1989, in
1-3517).
+(g) 36-- Equity Ownership Plan of Entergy Corporation and
Subsidiaries (A-4(a) to Rule 24 Certificate, dated
May 24, 1991, in 70-7831).
+(g) 37-- Supplemental Retirement Plan (10(a)69 to Form 10-K
for the year ended December 31, 1992 in 1-3517).
+(g) 38-- Defined Contribution Restoration Plan of Entergy
Corporation and Subsidiaries (10(a)53 to Form 10-K for
the year ended December 31, 1989 in 1-3517).
+(g) 39-- Amendment No. 1 to the Equity Ownership Plan of
Entergy Corporation and Subsidiaries (10(a)71 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(g) 40-- Executive Disability Plan of Entergy Corporation
and Subsidiaries (10(a)72 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(g) 41-- Executive Medical Plan of Entergy Corporation and
Subsidiaries (10(a)73 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(g) 42-- Stock Plan for Outside Directors of Entergy
Corporation and Subsidiaries, as amended (10(a)74 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(g) 43-- Summary Description of Private Ownership Vehicle
Plan of Entergy Corporation and Subsidiaries (10(a)75 to
Form 10-K for the year ended December 31, 1992 in
1-3517).
+(g) 44-- Agreement between Entergy Corporation and Edwin
Lupberger (10(a)-42 to Form 10-K for the year ended
December 31, 1985 in 1-3517).
+(g) 45-- Agreement between Entergy Corporation and Jerry D.
Jackson (10(a)-68 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(g) 46-- Agreement between Entergy Services and Gerald D.
McInvale (10(a)-69 to Form 10-K for the year ended
December 31, 1992 in 1-3517).
+(g) 47-- Agreement between System Energy and Donald C.
Hintz (10(b)-47 to Form 10-K for the year ended December
31, 1991 in 1-9067).
+(g) 48-- Summary Description of Retired Outside Director
Benefit Plan (10(c)-90 to Form 10-K for the year ended
December 31, 1992 in 1-10764).
+(g) 49-- Amendment to Defined Contribution Restoration Plan
of Entergy Corporation and Subsidiaries (10(a) 81 to Form
10-K for the year ended December 31, 1993 in 1-11299).
+(g) 50-- System Executive Retirement Plan (10(a) 82 to Form
10-K for the year ended December 31, 1993 in 1-11299).
(12) Statement Re Computation of Ratios
*(a) AP&L's Computation of Ratios of Earnings to Fixed
Charges and of Earnings to Fixed Charges and Preferred
Dividends, as defined.
*(b) GSU's Computation of Ratios of Earnings to Fixed
Charges and of Earnings to Fixed Charges and Preferred
Dividends, as defined.
*(c) LP&L's Computation of Ratios of Earnings to Fixed
Charges and of Earnings to Fixed Charges and Preferred
Dividends, as defined.
*(d) MP&L's Computation of Ratios of Earnings to Fixed
Charges and of Earnings to Fixed Charges and Preferred
Dividends, as defined.
*(e) NOPSI's Computation of Ratios of Earnings to Fixed
Charges and of Earnings to Fixed Charges and Preferred
Dividends, as defined.
*(f) System Energy's Computation of Ratios of Earnings to
Fixed Charges, as defined.
(18) Letter Re Change in Accounting Principles
*(a) Letter from Coopers & Lybrand L.L.P. regarding change in
accounting principles for AP&L.
*(b) Letter from Coopers & Lybrand L.L.P. regarding change in
accounting principles for Entergy.
*(21) Subsidiaries of the Registrants
(23) Consents of Experts and Counsel
*(a) The consent of Coopers & Lybrand L.L.P. is contained
herein at page 214.
*(b) The consent of Deloitte & Touche LLP is contained herein
at page 215.
*(c) The consent of Clark, Thomas & Winters is contained
herein at page 216.
*(d) The consent of Sandlin Associates is contained herein at
page 217.
*(24) Powers of Attorney
(27) Financial Data Schedule
*(a) Financial Data Schedule for Entergy Corporation and
Subsidiaries as of December 31, 1995.
*(b) Financial Data Schedule for AP&L as of December 31, 1995.
*(c) Financial Data Schedule for GSU as of December 31, 1995.
*(d) Financial Data Schedule for LP&L as of December 31, 1995.
*(e) Financial Data Schedule for MP&L as of December 31, 1995.
*(f) Financial Data Schedule for NOPSI as of December 31,
1995.
*(g) Financial Data Schedule for System Energy as of December
31, 1995.
(99) Additional Exhibits
GSU
(a) 1 Opinion of Clark, Thomas & Winters, a professional
corporation, dated September 30, 1992 regarding the effect
of the October 1, 1991 judgment in GSU v. PUCT in the
District Court of Travis County, Texas (99-1 in Registration
No. 33-48889).
(a) 2 Opinion of Clark, Thomas & Winters, a professional
corporation, dated August 8, 1994 regarding recovery of
costs deferred purusant to PUCT order in Docket 6525 (99 (j)
to Quarterly Report on Form 10-Q for the quarter ended June
30, 1994 in No. 1-2703).
*(a) 3 Opinion of Clark, Thomas & Winters, a professional
corporation, confirming its opinions dated September 30,
1992 and August 8, 1994.
_________________
* Filed herewith.
+ Management contracts or compensatory plans or arrangements.
Exhibit 3(i)(f)1
RESTATED ARTICLES OF INCORPORATION
OF
MISSISSIPPI POWER & LIGHT COMPANY
Pursuant to the provisions of Section 64 of the Mississippi
Business Corporation Law (Section 79-3-127, Mississippi Code of
1972, as amended), the undersigned Corporation adopts the
following Restated Articles of Incorporation:
FIRST: The name of the Corporation is MISSISSIPPI POWER &
LIGHT COMPANY.
SECOND: The period of its duration is ninety-nine (99)
years.
THIRD: The purpose or purposes which the Corporation is
authorized to pursue are:
To acquire, buy, hold, own, sell, lease, exchange, dispose
of, finance, deal in, construct, build, equip, improve, use,
operate, maintain and work upon:
(a) Any and all kinds of plants and systems for the
manufacture, production, storage, utilization, purchase,
sale, supply, transmission, distribution or disposition of
electricity, natural or artificial gas, water or steam, or
power produced thereby, or of ice and refrigeration of any
and every kind;
(b) Any and all kinds of telephone, telegraph, radio,
wireless and other systems, facilities and devices for the
receipt and transmission of sounds and signals, any and all
kinds of interurban, city and street railways and railroads
and bus lines for the transportation of passengers and/or
freight, transmission lines, systems, appliances, equipment
and devices and tracks, stations, buildings and other
structures and facilities;
(c) Any and all kinds of works, power plants,
manufactories, structures, substations, systems, tracks,
machinery, generators, motors, lamps, poles, pipes, wires,
cables, conduits, apparatus, devices, equipment, supplies,
articles and merchandise of every kind pertaining to or in
anywise connected with the construction, operation or
maintenance of telephone, telegraph, radio, wireless and
other systems, facilities and devices for the receipt and
transmission of sounds and signals, or of interurban, city
and street railways and railroads and bus lines, or in
anywise connected with or pertaining to the manufacture,
production, purchase, use, sale, supply, transmission,
distribution, regulation, control or application of
electricity, natural or artificial gas, water, steam, ice,
refrigeration and power or any other purposes;
To acquire, buy, hold, own, sell, lease, exchange, dispose
of, transmit, distribute, deal in, use, manufacture, produce,
furnish and supply street and interurban railway and bus service,
electricity, natural or artificial gas, light, heat, ice,
refrigeration, water and steam in any form and for any purposes
whatsoever, and any power or force or energy in any form and for
any purposes whatsoever;
To buy, sell, manufacture, produce and generally deal in
milk, cream and any articles or substances used or usable in or
in connection with the manufacture and production of ice cream,
ices, beverages and soda fountain supplies; to buy, sell,
manufacture, produce and generally deal in ice cream and ices;
To acquire, organize, assemble, develop, build up and
operate constructing and operating and other organizations and
systems, and to hire, sell, lease, exchange, turn over, deliver
and dispose of such organizations and systems in whole or in part
and as going organizations and systems and otherwise, and to
enter into and perform contracts, agreements and undertakings of
any kind in connection with any or all the foregoing powers;
To do a general contracting business;
To purchase, acquire, develop, mine, explore, drill, hold,
own and dispose of lands, interests in and rights with respect to
lands and waters and fixed and movable property;
To borrow money and contract debts when necessary for the
transaction of the business of the Corporation or for the
exercise of its corporate rights, privileges or franchises or for
any other lawful purpose of its incorporation; to issue bonds,
promissory notes, bills of exchange, debentures and other
obligations and evidences of indebtedness payable at a specified
time or times or payable upon the happening of a specified event
or events, whether secured by mortgage, pledge or otherwise or
unsecured, for money borrowed or in payment for property
purchased or acquired or any other lawful objects;
To guarantee, purchase, hold, sell, assign, transfer,
mortgage, pledge or otherwise dispose of the shares of the
capital stock of, or any bonds, securities or evidences of
indebtedness created by, any other corporation or corporations of
the State of Mississippi or any other state or government and,
while the owner of such stock, to exercise all the rights, powers
and privileges of individual ownership with respect thereto
including the right to vote thereon, and to consent and otherwise
act with respect thereto;
To aid in any manner any corporation or association,
domestic or foreign, or any firm or individual, any shares of
stock in which or any bonds, debentures, notes, securities,
evidences of indebtedness, contracts or obligations of which are
held by or for the Corporation or in which or in the welfare of
which the Corporation shall have any interest, and to do any acts
designed to protect, preserve, improve or enhance the value of
any property at any time held or controlled by the Corporation,
or in which it may be at any time interested; and to organize or
promote or facilitate the organization of subsidiary companies;
To purchase, hold, sell and transfer shares of its own
capital stock, provided that the Corporation shall not purchase
its own shares of capital stock except from surplus of its assets
over its liabilities including capital; and provided, further,
that the shares of its own capital stock owned by the Corporation
shall not be voted upon directly or indirectly nor counted as
outstanding for the purposes of any stockholders' quorum or vote;
In any manner to acquire, enjoy, utilize and to dispose of
patents, copyrights and trade-marks and any licenses or other
rights or interests therein and thereunder:
To purchase, acquire, hold, own or dispose of franchises,
concessions, consents, privileges and licenses necessary for and
in its opinion useful or desirable for or in connection with the
foregoing powers;
To do all and everything necessary and proper for the
accomplishment of the objects enumerated in these Restated
Articles of Incorporation or any amendment thereof or necessary
or incidental to the protection and benefits of the Corporation,
and in general to carry on any lawful business necessary or not
incidental to the attainment of the objects of the Corporation
whether or not such business is similar in nature to the objects
set forth in these Restated Articles of Incorporation or any
amendment thereof.
To do any or all things herein set forth, to the same extent
and as fully as natural persons might or could do, and in any
part of the world, and as principal, agent, contractor or
otherwise, and either alone or in conjunction with any other
persons, firms, associations or corporations;
To conduct its business in all its branches in the State of
Mississippi, other states, the District of Columbia, the
territories and colonies of the United States, and any foreign
countries, and to have one or more offices out of the State of
Mississippi and to hold, purchase, mortgage and convey real and
personal property both within and without the State of
Mississippi; provided, however, that the Corporation shall not
exercise any of the powers set forth herein for the purpose of
engaging in business as a street railway, telegraph or telephone
company unless prior thereto this Article Third shall have been
amended to set forth a description of the line and the points it
will traverse.
FOURTH: The aggregate number of shares which the Corporation
shall have authority to issue is 17,004,478 shares, divided into
2,004,476 shares of Preferred Stock of the par value of $100 per
share and 15,000,000 shares of Common Stock without par value.
The preferences, limitations and relative rights in respect
of the shares of each class and the variations in the relative
rights and preferences as between series of any preferred or
special class in series are as follows:
The Preferred Stock shall be issuable in one or more series
from time to time and the shares of each series shall have the
same rank and be identical with each other and shall have the
same relative rights except with respect to the following:
(a) The number of shares to constitute each such series
and the distinctive designation thereof;
(b) The annual rate or rates of dividends payable on
shares of such series, the dates on which dividends shall be
paid in each year and the date from which such dividends
shall commence to accumulate;
(c) The amount or amounts payable upon redemption
thereof; and
(d) The sinking fund provisions, if any, for the
redemption or purchase of shares;
which different characterics of clauses (a), (b), (c) and (d)
above may be stated and expressed with respect to each series in
the resolution or resolutions providing for the issue of such
series adopted by the Board of Directors or in these Restated
Articles of Incorporation of any amendment thereof.
A series of 60,000 shares of Preferred Stock shall:
(a) be designated "4.36% Preferred Stock Cumulative,
$100 Par Value";
(b) have a dividend rate of $4.36 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be
February 1, 1963, and such dividends to be cumulative from
the last date to which dividends upon the 4.36% Preferred
Stock Cumulative, $100 Par Value, of Mississippi Power &
Light Company, a Florida corporation, are paid;
(c) be subject to redemption in the manner provided
herein with respect to the Preferred Stock at the price of
$105.36 per share if redeemed on or before February 1, 1964,
and of $103.88 per share if redeemed after February 1, 1964,
in each case plus an amount equivalent to the accumulated
and unpaid dividends thereon, if any, to the date fixed for
redemption.
A series of 44,476 shares of the Preferred Stock shall:
(a) be designated "4.56% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $4.56 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be
February 1, 1963, and such dividends to be cumulative from
the last date to which dividends upon the 4.56% Preferred
Stock, Cumulative, $100 Par Value, of Mississippi Power &
Light Company, a Florida corporation, are paid; and
(c) be subject to redemption in the manner provided
herein with respect to the Preferred Stock at the price of
$108.50 per share if redeemed on or before November 1, l964,
and of $107.00 per share if redeemed after November 1, 1964,
in each case plus an amount equivalent to the accumulated
and unpaid dividends thereon, if any, to the date fixed for
redemption.
A series of 100,000 shares of the Preferred Stock shall:
(a) be designated "4.92% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $4.92 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be
February 1, 1966, and such dividends to be cumulative from
the date of issue of said series; and
(c) be subject to redemption at the price of $106.30 per
share if redeemed on or before January 1, 1971, of $104.38
per share if redeemed after January 1, 1971 and on or before
January 1, 1976, and of $102.88 per share if redeemed after
January 1, 1976, in each case plus an amount equivalent to
the accumulated and unpaid dividends thereon, if any, to the
date fixed for redemption.
A series of 75,000 shares of the Preferred Stock shall:
(a) be designated "9.16% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $9.16 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be
November 1, 1970, and such dividends to be cumulative from
the date of issue of said series; and
(c) be subject to redemption at the price of $110.93 per
share if redeemed on or before August 1, 1975, of $108.64
per share if redeemed after August 1, 1975 and on or before
August 1, 1980, of $106.35 per share if redeemed after
August 1, 1980 and on or before August 1, 1985, and of
$104.06 per share if redeemed after August 1, 1985, in each
case plus an amount equivalent to the accumulated and unpaid
dividends thereon, if any, to the date fixed for redemption;
provided, however, that no share of the 9.16% Preferred
Stock, Cumulative, $100 Par Value, shall be redeemed prior
to August 1, 1975 if such redemption is for the purpose or
in anticipation of refunding such share through the use,
directly or indirectly, of funds borrowed by the
Corporation, or through the use, directly or indirectly, of
funds derived through the issuance by the Corporation of
stock ranking prior to or on a parity with the 9.16%
Preferred Stock, Cumulative, $100 Par Value, as to dividends
or assets, if such borrowed funds have an effective interest
cost to the Corporation (computed in accordance with
generally accepted financial practice) or such stock has an
effective dividend cost to the Corporation (so computed) of
less than the effective dividend cost to the Corporation of
the 9.16% Preferred Stock, Cumulative, $100 Per Value.
A series of 100,000 shares of the Preferred Stock shall:
(a) be designated "7.44% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $7.44 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be May
1, 1973, and such dividends to be cumulative from February
14, 1973; and
(c) be subject to redemption at the price of $108.39 per
share if redeemed on or before February 1, 1978, of $106.53
per share if redeemed after February 1, 1978 and on or
before February 1, 1983, of $104.67 per share if redeemed
after February 1, 1983 and on or before February 1, 1988,
and of $102.81 per share if redeemed after February 1, 1988,
in each case plus an amount equivalent to the accumulated
and unpaid dividends thereon, if any, to the date fixed for
redemption; provided, however, that no share of the 7.44%
Preferred Stock, Cumulative, $100 Par Value, shall be
redeemed prior to February 1, 1978 if such redemption is for
the purpose or in anticipation of refunding such share
through the use, directly or indirectly, of funds borrowed
by the Corporation, or through the use, directly or
indirectly, of funds derived through the issuance by the
Corporation of stock ranking prior to or on a parity with
the 7.44% Preferred Stock, Cumulative, $100 Par Value, as to
dividends or assets, if such borrowed funds have an
effective interest cost to the Corporation (computed in
accordance with generally accepted financial practice) or
such stock has an effective dividend cost to the Corporation
(so computed) of less than the effective dividend cost to
the Corporation of the 7.44% Preferred Stock, Cumulative,
S100 Par Value.
A series of 200,000 shares of the Preferred Stock shall:
(a) be designated "17% Preferred Stock, Cumulative, $100
Par Value"
(b) have a dividend rate of $17.00 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be
November 1, 1981, and such dividends to be cumulative from
the date of issuance;
(c) be subject to redemption at the price of $117.00 per
share if redeemed on or before September 1, 1986, of $112.75
per share if redeemed after September 1, 1986 and on or
before September 1, 1991, of $108.50 per share if redeemed
after September 1, 1991 and on or before September 1, 1996,
and of $104.25 per share if redeemed after September 1,
1996, in each case plus an amount equivalent to the
accumulated and unpaid dividends thereon, if any, to the
date fixed for redemption; provided, however, that no share
of the 17% Preferred Stock Cumulative, $100 Par Value, shall
be redeemed prior to September 1, 1986 if such redemption is
for the purpose or in anticipation of refunding such share
through the use, directly or indirectly, of funds borrowed
by the Corporation or through the use, directly or
indirectly, of funds derived through the issuance by the
Corporation of stock ranking prior to or on a parity with
the 17% Preferred Stock, Cumulative, $100 Par Value, as to
dividends or assets if such borrowed funds have an effective
interest cost to the Corporation (computed in accordance
with generally accepted financial practice) or such stock;
has an effective dividend cost to the Corporation (so
computed) of less than the effective dividend cost to the
Corporation of the 17% Preferred Stock, Cumulative, $100 Par
Value; and
(d) be subject to redemption as and for a sinking fund
as follows: On September 1, 1986 and on each September 1
thereafter (each such date being hereinafter referred to as
a "17% Sinking Fund Redemption Date"), for so long as any
shares of the 17% Preferred Stock, Cumulative, $100 Par
Value, shall remain outstanding, the Corporation shall
redeem, out of funds legally available therefor, 10,000
shares of the 17% Preferred Stock, Cumulative, $100 Par
value (or the number of shares then outstanding if less than
10,000) at the sinking fund redemption price of $100 per
share plus, as to each share so redeemed, an amount
equivalent to the accumulated and unpaid dividends thereon,
if any, to the date of redemption (the obligation of the
Corporation so to redeem the shares of the 17% Preferred
Stock, Cumulative, $100 Par Value, being hereinafter
referred to as the "17% Sinking Fund Obligation"); the 17%
Sinking Fund Obligation shall be cumulative; if on any 17%
Sinking Fund Redemption Date, the Corporation shall not have
funds legally available therefor sufficient to redeem the
full number of shares required to be redeemed on that date,
the 17% Sinking Fund Obligation with respect to the shares
not redeemed shall carry forward to each successive 17%
Sinking Fund Redemption Date until such shares shall have
been redeemed; whenever on any 17% Sinking Fund Redemption
Date, the funds of the Corporation legally available for the
satisfaction of the 17% Sinking Fund Obligation and all
other sinking fund and similar obligations then existing
with respect to any other class or series of its stock
ranking on a parity as to dividends or assets with the 17%
Preferred Stock, Cumulative, $100 Par Value (such Obligation
and obligations collectively being hereinafter referred to
as the "Total Sinking Fund Obligation") are insufficient to
permit the Corporation to satisfy fully its Total Sinking
Fund Obligation on that date, the Corporation shall apply to
the satisfaction of its 17% Sinking Fund Obligation on that
date that proportion of such legally available funds which
is equal to the ratio of such 17% Sinking Fund Obligation to
such Total Sinking Fund Obligation; in addition to the 17%
Sinking Fund Obligation, the Corporation shall have the
option, which shall be noncumulative, to redeem, upon
authorization of the Board of Directors, on each 17% Sinking
Fund Redemption Date, at the aforesaid sinking fund
redemption price, up to 10,000 additional shares of the 17%
Preferred Stock, Cumulative, $100 Par Value; the Corporation
shall be entitled, at its election, to credit against its
17% Sinking Fund Obligation on any 17% Sinking Fund
Redemption Date any shares of the 17% Preferred Stock,
Cumulative, Stock Par Value (including shares of the 17%
Preferred Stock, Cumulative, $100 Par Value optionally
redeemed at the aforesaid sinking fund price) theretofore
redeemed (other than shares of the 17% Preferred Stock,
Cumulative, $100 Par Value redeemed pursuant to the 17%
Sinking Fund Obligation) purchased or otherwise acquired and
not previously credited against the 17% Sinking Fund
Obligation.
A series of 100,000 shares of the Preferred Stock shall:
(a) be designated "14-3/4% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $14.75 per share per annum
payable quarterly on February 1, May 1, August 1 and
November 1 of each year, the first dividend date to be May 1
1982, and such dividends to be cumulative from the date of
issuance;
(c) be subject to redemption at the price of $114.75 per
share if redeemed after the issuance and sale and on or
before March 1, 1983, $113.11 per share if redeemed after
March 1, 1983 and on or before March 1, 1984, $111.47 per
share if redeemed after March 1, 1984 and on or before March
1, 1985, $109.83 per share if redeemed after March 1, 1985
and on or before March 1, 1986, $108.19 per share if
redeemed after March 1, 1986 and on or before March 1, 1987,
$106.56 per share if redeemed after March 1, 1987 and on or
before March 1, 1988, $104.92 per share if redeemed after
March 1, 1988 and on or before March 1, 1989, $103.28 per
share if redeemed after March 1, 1989 and on or before March
1, l990, $101.64 per share if redeemed after March 1, 1990
and on or before March 1, 1991, and $100.00 per share if
redeemed after March 1, 1991, in each case plus an amount
equivalent to the accumulated and unpaid dividends thereon,
if any, to the date fixed for redemption; provided, however,
that no share of the 14-3/4% Preferred Stock, Cumulative,
$100 Par Value, shall be redeemed prior to March 1, 1987 if
such redemption is for the purpose or in anticipation of
refunding such share through the use, directly or
indirectly, of funds borrowed by the Corporation, or through
the use, directly or indirectly, of funds derived through
the issuance by the Corporation of stock ranking prior to or
on a parity with the 14-3/4% Preferred Stock, Cumulative,
$100 Par Value, as to dividends or assets, if such borrowed
funds have an effective interest cost to the Corporation
(computed in accordance with generally accepted financial
practice) or such stock has an effective dividend cost to
the Corporation (so computed) of less than the effective
dividend cost to the Corporation of the 14-3/4% Preferred
Stock, Cumulative, $100 Par Value; and
(d) be subject to redemption as and for a sinking fund
as follows. On March 1, 1990, 1991 and 1992 (each such date
being hereinafter referred to as a "14-3/4% Sinking Fund
Redemption Date"), the Corporation shall redeem, out of
funds legally available therefor, 33,333, 33,333 and 33,334
shares, respectively, of the 14-3/4% Preferred Stock,
Cumulative, $100 Par Value, at the sinking fund redemption
price of $100 per share plus, as to each share so redeemed,
an amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date of redemption (the obligation
of the Corporation so to redeem the shares of the 14-3/4%
Preferred Stock, Cumulative, $100 Par Value, being
hereinafter referred to as the "14-3/4% Sinking Fund
Obligation"); the 14-3/4% Sinking Fund Obligation shall be
cumulative; if on any 14-3/4% Sinking Fund Redemption Date,
the Corporation shall not have funds legally available
therefor sufficient to redeem the full number of shares
required to be redeemed on that date, the 14-3/4% Sinking
Fund Obligation with respect to the shares not redeemed
shall carry forward to each successive 14-3/4% Sinking Fund
Redemption Date (or, in the event the 14-3/4% Sinking Fund
Obligation is not satisfied on March 1, 1992, to such date
as soon thereafter as funds are legally available to satisfy
the 14-3/4% Sinking Fund Obligation) until such shares shall
have been redeemed; whenever on any 14-3/4% Sinking Fund
Redemption Date, the funds of the Corporation legally
available for the satisfaction of the 14-3/4% Sinking Fund
Obligation and all other sinking fund and similar
obligations then existing with respect to any other class or
series of its stock ranking on a parity as to dividends or
assets with the 14-3/4% Preferred Stock, Cumulative, $100
Par Value (such Obligation and obligations collectively
being hereinafter referred to as the "Total Sinking Fund
Obligation") are insufficient to permit the Corporation to
satisfy fully its Total Sinking Fund Obligation on that
date, the Corporation shall apply to the satisfaction of its
14-3/4% Sinking Fund Obligation on that date that proportion
of such legally available funds which is equal to the ratio
of such 14-3/4% Sinking Fund Obligation to such Total
Sinking Fund Obligation.
A series of 100,000 shares of the Preferred Stock shall:
(a) be designated "12.00% Preferred Stock, Cumulative,
$100 Par Value";
(b) have a dividend rate of $12.00 per share per annum
payable quarterly on February 1, May 1, August 1 and
November l of each year, the first dividend date to be May
1, 1983, and such dividends to be cumulative from the date
of issuance;
(c) be subject to redemption at the price of $112.00 per
share if redeemed on or before March 1, 1988, of $109.00 per
share if redeemed after March 1, 1988 and on or before March
1, 1993, of $106.00 per share if redeemed after March 1,
1993 and on or before March 1, 1998, and of $103.00 per
share if redeemed after March 1, 1998, in each case plus an
amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date fixed for redemption; provided,
however, that no share of the 12.00% Preferred Stock,
Cumulative, $100 Par Value, shall be redeemed prior to March
1, 1988 if such redemption is for the purpose or in anticipa
tion of refunding such share through the use, directly or
indirectly, of funds borrowed by the Corporation, or through
the use, directly or indirectly, of funds derived through
the issuance by the Corporation of stock ranking prior to or
on a parity with the 12.00% Preferred Stock, Cumulative,
$100 Par Value, as to dividends or assets, if such borrowed
funds have an effective interest cost to the Corporation
(computed in accordance with generally accepted financial
practice) or such stock has an effective dividend cost to
the Corporation (so computed) of less than 12.7497% to per
annum; and
(d) be subject to redemption as and for a sinking fund
as follows: on March 1, 1888 and on each March 1 thereafter
(each such date being hereinafter referred to as a "12.00%
Sinking Fund Redemption Date"), for so long as any shares of
the 12.00% Preferred Stock, Cumulative, $100 Par Value,
shall remain outstanding, the Corporation shall redeem, out
of funds legally available therefor, 5,000 shares of the
12.00% Preferred Stock, Cumulative, $100 Par Value (or the
number of shares then outstanding if less than 5,000) at the
sinking fund redemption price of $100 per share plus, as to
each share so redeemed, an amount equivalent to the
accumulated and unpaid dividends thereon, if any, to the
date of redemption (the obligation of the Corporation so to
redeem the shares of the 12.00% Preferred Stock, Cumulative,
$100 Par Value, being hereinafter referred to as the "12.00%
Sinking Fund Obligation"); the 12.00% Sinking Fund
Obligation shall be cumulative; if on any 12.00% Sinking
Fund Redemption Date, the Corporation shall not have funds
legally available therefor sufficient to redeem the full
number of shares required to be redeemed on that date, the
12.00% Sinking Fund Obligation with respect to the shares
not redeemed shall carry forward to each successive 12.00%
Sinking Fund Redemption Date until such shares shall have
been redeemed; whenever on any 12.00% Sinking Fund
Redemption Date, the funds of the Corporation legally
available for the satisfaction of the 12.00% Sinking Fund
Obligation and all other sinking fund and similar
obligations then existing with respect to any other class or
series of its stock ranking on a parity as to dividends or
assets with the 12.00% Preferred Stock Cumulative, $100 Par
Value (such Obligation and obligations collectively being
hereinafter referred to as the "Total Sinking Fund
Obligation") are insufficient to permit the Corporation to
satisfy fully its Total Sinking Fund Obligation on that
date, the Corporation shall apply to the satisfaction of its
12.00% Sinking Fund Obligation on that date that proportion
of such legally available funds which is equal to the ratio
of such 12.00% Sinking Fund Obligation to such Total Sinking
Fund Obligation; in addition to the 12.00% Sinking Fund
Obligation, the Corporation shall have the option, which
shall be noncumulative, to redeem, upon authorization of the
Board of Directors, on each 12.00% Sinking Fund Redemption
Date, at the aforesaid sinking fund redemption price, up to
5,000 additional shares of the 12.00% Preferred Stock
Cumulative, $100 Par Value; the Corporation shall be
entitled, at its election, to credit against its 12.00%
Sinking Fund Obligation on any 12.00% Sinking Fund
Redemption Date any shares of the 12.00% Preferred Stock,
Cumulative, $100 Par Value (including shares of the 12.00%
Preferred Stock Cumulative, $100 Par Value optionally
redeemed at the aforesaid sinking fund price) theretofore
redeemed (other than shares of the 12.00% Preferred Stock,
Cumulative, $100 Par Value redeemed pursuant to the 12.00%
Sinking Fund Obligation) purchased or otherwise acquired and
not previously credited against the 12.00% Sinking Fund
Obligation.
Subject to the foregoing, the distinguishing characteristics
of the Preferred Stock shall be:
(A) Each series of the Preferred Stock, pari passu with all
shares of preferred stock of any class or series then
outstanding, shall be entitled but only when and as declared by
the Board of Directors, out of funds legally available for the
payment of dividends in preference to the Common Stock, to
dividends at the rate stated and expressed with respect to such
series herein or by the resolution or resolutions providing for
the issue of such series adopted by the Board of Directors; such
dividends to be cumulative from such date and payable on such
dates in each year as may be stated and expressed in said
resolution, to stockholders of record as of a date not to exceed
40 days and not less than 10 days preceding the dividend payment
dates so fixed.
(B) If and when dividends payable on any of the Preferred
Stock of the Corporation at any time outstanding shall be in
default in an amount equal to four full quarterly payments or
more per share, and thereafter until all dividends on any such
preferred stock in default shall have been paid, the holders of
the Preferred Stock pari passu with the holders of other
preferred stock then outstanding, voting separately as a class,
shall be entitled to elect the smallest number of directors
necessary to constitute a majority of the full Board of
Directors, and, except as provided in the following paragraph,
the holders of the Common Stock, voting separately as a class,
shall be entitled to elect the remaining directors of the
Corporation. The terms of office, as directors, of all persons
who may be directors of the Corporation at the time shall
terminate upon the election of a majority of the Board of
Directors by the holders of the Preferred Stock except that if
the holders of the Common Stock shall not have elected the
remaining directors of the Corporation, then, and only in that
event, the directors of the Corporation in office just prior to
the election of a majority of the Board of Directors by the
holders of the Preferred Stock shall elect the remaining
directors of the Corporation. Thereafter, while such default
continues and the majority of the Board of Directors is being
elected by the holders of the Preferred Stock, the remaining
directors, whether elected by directors, as aforesaid, or whether
originally or later elected by holders of the Common Stock shall
continue in office until their successors are elected by holders
of the Common Stock and shall qualify.
If and when all dividends then in default on the Preferred
Stock; then outstanding shall be paid (such dividends to be
declared and paid out of any funds legally available therefor as
soon as reasonably practicable), the holders of the Preferred
Stock shall be divested of any special right with respect to the
election of directors, and the voting power of the holders of the
Preferred Stock and the holders of the Common Stock shall revert
to the status existing before the first dividend payment date on
which dividends on the Preferred Stock were not paid in full, but
always subject to the same provisions for vesting such special
rights in the holders of the Preferred Stock in case of further
like defaults in the payment of dividends thereon as described in
the immediately foregoing paragraph. Upon termination of any such
special voting right upon payment of all accumulated and unpaid
dividends on the Preferred Stock, the terms of office of all
persons who may have been elected directors of the Corporation by
vote of the holders of the Preferred Stock as a class, pursuant
to such special voting right shall forthwith terminate, and the
resulting vacancies shall be filled by the vote of a majority of
the remaining directors.
In case of any vacancy in the office of a director occurring
among the directors elected by the holders of the Preferred
Stock, voting separately as a class, the remaining directors
elected by the holders of the Preferred Stock, by affirmative
vote of a majority thereof, or the remaining director so elected
if there be but one, may elect a successor or successors to hold
office for the unexpired term or terms of the director or
directors whose place or places shall be vacant. Likewise, in
case of any vacancy in the office of a director occurring among
the directors not elected by the holders of the Preferred Stock,
the remaining directors not elected by the holders of the
Preferred Stock, by affirmative vote of a majority thereof, or
the remaining director so elected if there be but one, may elect
a successor or successors to hold office for the unexpired term
or terms of the director or directors whose place or places shall
be vacant.
Whenever the right shall have accrued to the holders of the
Preferred Stock to elect directors, voting separately as a class,
it shall be the duty of the President, a Vice-President or the
Secretary of the Corporation forthwith to call and cause notice
to be given to the shareholders entitled to vote of a meeting to
be held at such time as the Corporation's officers may fix, not
less than forty-five nor more than sixty days after the accrual
of such right, for the purpose of electing directors. The notice
so given shall be mailed to each holder of record of preferred
stock at his last known address appearing on the books of the
Corporation and shall set forth, among other things, (i) that by
reason of the fact that dividends payable on preferred stock are
in default in an amount equal to four full quarterly payments or
more per share, the holders of the Preferred Stock, voting
separately as a class, have the right to elect the smallest
number of directors necessary to constitute a majority of the
full Board of Directors of the Corporation, (ii) that any holder
of the Preferred Stock has the right, at any reasonable time, to
inspect, and make copies of, the list or lists of holders of the
Preferred Stock maintained at the principal office of the
Corporation or at the office of any Transfer Agent of the
Preferred Stock, and (iii) either the entirety of this paragraph
or the substance thereof with respect to the number of shares of
the Preferred Stock required to be represented at any meeting, or
adjournment thereof, called for the election of directors of the
Corporation. At the first meeting of stockholders held for the
purpose of electing directors during such time as the holders of
the Preferred Stock shall have the special right, voting
separately as a class, to elect directors, the presence in person
or by proxy of the holders of a majority of the outstanding
Common Stock shall be required to constitute a quorum of such
class for the election of directors, and the presence in person
or by proxy of the holders of a majority of the outstanding
Preferred Stock shall be required to constitute a quorum of such
class for the election of directors; provided, however, that in
the absence of a quorum of the holders of the Preferred Stock, no
election of directors shall be held, but a majority of the
holders of the Preferred Stock who are present in person or by
proxy shall have power to adjourn the election of the directors
to a date not less than fifteen nor more than fifty days from the
giving of the notice of such adjourned meeting hereinafter
provided for; and provided, further, that at such adjourned
meeting, the presence in person or by proxy of the holders of 35%
of the outstanding Preferred Stock shall be required to
constitute a quorum of such class for the election of directors.
In the event such first meeting of stockholders shall be so
adjourned, it shall be the duty of the President, a Vice-
President or the Secretary of the Corporation, within ten days
from the date on which such first meeting shall have been
adjourned, to cause notice of such adjourned meeting to be given
to the shareholders entitled to vote thereat, such adjourned
meeting to be held not less than fifteen days nor more than fifty
days from the giving of such second notice. Such second notice.
shall be given in the form and manner hereinabove provided for
with respect to the notice required to be given of such first
meeting of stockholders, and shall further set forth that a
quorum was not present at such first meeting and that the holders
of 35% of the outstanding Preferred Stock shall be required to
constitute a quorum of such class for the election of directors
at such adjourned meeting. If the requisite quorum of holders of
the Preferred Stock shall not be present at said adjourned
meeting, then the directors of the Corporation then in office
shall remain in office until the next Annual Meeting of the
Corporation, or special meeting in lieu thereof and until their
successors shall have been elected and shall qualify. Neither
such first meeting nor such adjourned meeting shall be held on a
date within sixty days of the date of the next Annual Meeting of
the Corporation, or special meeting in lieu thereof. At each
Annual Meeting of the Corporation, or special meeting in lieu
thereof, held during such time as the holders of the Preferred
Stock, voting separately as a class. shall have the right to
elect a majority of the Board of Directors, the foregoing
provisions of this paragraph shall govern each Annual Meeting, or
special meeting in lieu thereof, as if said Annual Meeting or
special meeting were the first meeting of stockholders held for
the purpose of electing directors after the right of the holders
of the Preferred Stock, voting separately as a class, to elect a
majority of the Board of Directors, should have accrued the
exception, that if, at any adjourned annual meeting, or special
meeting in lieu thereof, the holders of 35% of the outstanding
Preferred Stock are not present in person or by proxy, all the
directors shall be elected by a vote of the holders of a majority
of the Common Stock of the Corporation present or represented at
the meeting.
(C) So long as any shares of the Preferred Stock are
outstanding, the Corporation shall not, without the consent
(given by vote at a meeting called for that purpose) of at least
two-thirds of the total number of shares of the Preferred Stock
then outstanding:
(1) create, authorize or issue any new stock which,
after issuance would rank prior to the Preferred Stock as to
dividends, in liquidation, dissolution, winding up or
distribution, or create, authorize or issue any security
convertible into shares of any such stock except for the
purpose of providing funds for the redemption of all of the
Preferred Stock then outstanding, such new stock or security
not to be issued until such redemption shall have been
authorized and notice of such redemption given and the
aggregate redemption price deposited as provided in
paragraph (G) below; provided, however, that any such new
stock or security shall be issued within twelve months after
the vote of the Preferred Stock herein provided for
authorizing the issuance of such new stock or security; or
(2) amend, alter, or repeal any of the rights,
preferences or powers of the holders of the Preferred Stock
so as to affect adversely any such rights, preferences or
powers; provided, however, that if such amendment,
alteration or repeal affects adversely the rights,
preferences or powers of one or more, but not all, series of
Preferred Stock at the time outstanding, only the consent of
the holders of at least two-thirds of the total number of
outstanding shares of all series so affected shall be
required; and provided, further, that an amendment to
increase or decrease the authorized amount of Preferred
Stock or to create or authorize, or increase or decrease the
amount of, any class of stock; ranking on a parity with the
outstanding shares of the Preferred Stock as to dividends or
assets shall not be deemed to affect adversely the rights,
preferences or powers of the holders of the Preferred Stock
or any series thereof.
(D) So long as any shares of the Preferred Stock are
outstanding, the Corporation shall not, without the consent
(given by vote at a meeting called for that purpose) of the
holders of a majority of the total number of shares of the
Preferred Stock then outstanding:
(1) merge or consolidate with or into any other
corporation or corporations or sell or otherwise dispose of
all or substantially all of the assets of the Corporation,
unless such merger or consolidation or sale or other
disposition, or the exchange, issuance or assumption of all
securities to be issued or assumed in connection with any
such merger or consolidation or sale or other disposition,
shall have been ordered, approved or permitted under the
Public Utility Holding Company Act of 1935; or
(2) issue or assume any unsecured notes, debentures or
other securities representing unsecured indebtedness for
purposes other than (i) the refunding of outstanding
unsecured indebtedness theretofore issued or assumed by the
Corporation resulting in equal or longer maturities, or (ii)
the reacquisition, redemption or other retirement of all
outstanding shares of the Preferred Stock, if immediately
after such issue or assumption, the total principal amount
of all unsecured notes, debentures or other securities
representing unsecured indebtedness issued or assumed by the
Corporation, including unsecured indebtedness then to be
issued or assumed (but excluding the principal amount then
outstanding of any unsecured notes, debentures, or other
securities representing unsecured indebtedness having a
maturity in excess of ten (10) years and in amount not
exceeding 10% of the aggregate of (a) and (b) of this
section below) would exceed ten per centum (10%) of the
aggregate of (a) the total principal amount of all bonds or
other securities representing secured indebtedness issued or
assumed by the Corporation and then to be outstanding, and
(b) the capital and surplus of the Corporation as then to be
stated on the books of account of the Corporation. When
unsecured notes, debentures or other securities representing
unsecured debt of a maturity in excess of ten (10) years
shall become of a maturity of ten (10) years or less, it
shall then be regarded as unsecured debt of a maturity of
less than ten (10) years and shall be computed with such
debt for the purpose of determining the percentage ratio to
the sum of (a) and (b) above of unsecured debt of a maturity
of less than ten (10) years, and when provision shall have
been made, whether through a sinking fund or otherwise, for
the retirement, prior to their maturity, of unsecured notes,
debentures, or other securities representing unsecured debt
of a maturity in excess of ten (10) years, the amount of any
such security so required to be retired in less than ten
(10) years shall be regarded as unsecured debt of a maturity
of less than ten (10) years (and not as unsecured debt of a
maturity in excess of ten (10) years) and shall be computed
with such debt for the purpose of determining the percentage
ratio to the sum of (a) and (b) above of unsecured debt of a
maturity of less than ten (10) years, provided, however,
that the payment due upon the maturity of unsecured debt
having an original single maturity in excess of ten (10)
years or the payment due upon the latest maturity of any
serial debt which had original maturities in excess of ten
(10) years shall not, for purposes of this provision, be
regarded as unsecured debt of a maturity of less than ten
(10) years until such payment or payments shall be required
to be made within three (3) years; furthermore, when
unsecured notes, debentures or other securities representing
unsecured debt of a maturity of less than ten (10) years
shall exceed 10% of the sum of (a) and (b) above, no
additional unsecured notes, debentures or other securities
representing unsecured debt shall be issued or assumed
(except for the purpose set forth in (i) or (ii) above)
until such ratio is reduced to 10% of the sum of (a) and (b)
above; or
(3) issue, sell or otherwise dispose of any shares of
the Preferred Stock in addition to the 104,476 shares of the
Preferred Stock originally authorized, or of any other class
of stock ranking on a parity with the Preferred Stock as to
dividends or in liquidation, dissolution, winding up or
distribution, unless the gross income of the Corporation and
Mississippi Power & Light Company, a Florida corporation,
for a period of twelve (12) consecutive calendar months
within the fifteen (15) calendar months immediately
preceding the issuance, sale or disposition of such stock,
determined in accordance with generally accepted accounting
practices (but in any event after deducting all taxes and
the greater of (a) the amount for said period charged by the
Corporation and Mississippi Power & Light Company, a Florida
corporation, on their books to depreciation expense or (b)
the largest amount required to be provided therefor by any
mortgage indenture of the Corporation) to be available for
the payment of interest, shall have been at least one and
one-half times the sum of (i) the annual interest charges on
all interest bearing indebtedness of the Corporation and
(ii) the annual dividend requirements on all outstanding
shares of the Preferred Stock and of all other classes of
stock ranking prior to, or on a parity with, the Preferred
Stock as to dividends or distributions, including the shares
proposed to be issued; provided, that there shall be
excluded from the foregoing computation interest charges on
all indebtedness and dividends on all shares of stock which
are to be retired in connection with the issue of such
additional shares of the Preferred Stock or other class of
stocks ranking prior to, or on a parity with, the Preferred
Stock as to dividends or distributions; and provided,
further, that in any case where such additional shares of
the Preferred Stock, or other class of stock ranking on a
parity with the Preferred Stock as to dividends or
distributions, are to be issued in connection with the
acquisition of additional property, the gross income of the
property to be so acquired, computed on the same basis as
the gross income of the Corporation, may be included on a
pro forma basis in making the foregoing computation; or
(4) issue, sell, or otherwise dispose of any shares of
the Preferred Stock, in addition to the 104,476 shares of
the Preferred Stock originally authorized, or of any other
class of stock ranking on a parity with the Preferred Stock
as to dividends or distributions, unless the aggregate of
the capital of the Corporation applicable to the Common
Stock and the surplus of the Corporation shall be not less
than the aggregate amount payable on the involuntary
liquidation, dissolution, or winding up of the Corporation,
in respect of all shares of the Preferred Stock and all
shares of stock, if any, ranking prior thereto, or on a
parity therewith, as to dividends or distributions, which
will be outstanding after the issue of the shares proposed
to be issued; provided, that if, for the purposes of meeting
the requirements of this subparagraph (4), it becomes
necessary to take into consideration any earned surplus of
the Corporation, the Corporation shall not thereafter pay
any dividends on shares of the Common Stock which would
result in reducing the Corporation's Common Stock equity (as
in paragraph (H) hereinafter defined) to an amount less than
the aggregate amount payable, on involuntary liquidation,
dissolution or winding up the Corporation, on all shares of
the Preferred Stock and of any stock ranking prior to, or on
a parity with, the Preferred Stock, as to dividends or other
distributions, at the time outstanding.
(E) Each holder of Common Stock of the Corporation shall be
entitled to one vote, in person or by proxy, for each share of
such stock standing in his name on the books of the Corporation.
Except as hereinbefore expressly provided in this Section Fourth,
the holders of the Preferred Stock shall have no power to vote
and shall be entitled to no notice of any meeting of the
stockholders of the Corporation. As to matters upon which holders
of the Preferred Stock are entitled to vote as hereinbefore
expressly provided, each holder of such Preferred Stock shall be
entitled to one vote, in person or by proxy, for each share of
such Preferred Stock standing in his name on the books of the
Corporation.
(F) In the event of any voluntary liquidation, dissolution or
winding up of the Corporation, the Preferred Stock, pari passu
with all shares of preferred stock of any class or series then
outstanding, shall have a preference over the Common Stock until
an amount equal to the then current redemption price shall have
been paid. In the event of any involuntary liquidation,
dissolution or winding up of the Corporation, which shall include
any such liquidation, dissolution or winding up which may arise
out of or result from the condemnation or purchase of all or a
major portion of the properties of the Corporation, by (i) the
United States Government or any authority, agency or
instrumentality thereof, (ii) a state of the United States or any
political subdivision, authority, agency, or instrumentality
thereof, or (iii) a district, cooperative or other association or
entity not organized for profit, the Preferred Stock, pari passu
with all shares of preferred stock of any class or series then
outstanding, shall also have a preference over the Common Stock
until the full par value thereof and an amount equal to all
accumulated and unpaid dividends thereon shall have been paid by
dividends or distribution.
(G) Upon the affirmative vote of a majority of the shares of
the issued and outstanding Common Stock at any annual meeting, or
any special meeting called for that purpose, the Corporation may
at any time redeem all of any series of said Preferred Stock or
may from time to time redeem any part thereof, by paying in cash
the redemption price then applicable thereto as stated and
expressed with respect to such series in the resolution providing
for the issue of such shares adopted by the Board of Directors of
the Corporation, or in these Restated Articles of Incorporation
or any amendment thereof, plus, in each case, an amount
equivalent to the accumulated and unpaid dividends, if any, to
the date of redemption. Notice of the intention of the
Corporation to redeem all or any part of the Preferred Stock
shall be mailed not less than thirty (30) days nor more than
sixty (60) days before the date of redemption to each holder of
record of Preferred Stock to be redeemed, at his post office
address as shown by the Corporation's records, and not less than
thirty (30) days' nor more than sixty (60) days' notice of such
redemption may be published in such manner as may be prescribed
by resolution of the Board of Directors of the Corporation; and,
in the event of such publication, no defect in the mailing of
such notice shall affect the validity of the proceedings for the
redemption of any shares of Preferred Stock so to be redeemed.
Contemporaneously with the mailing or the publication of such
notice as aforesaid or at any time thereafter prior to the date
of redemption, the Corporation may deposit the aggregate
redemption price (or the portion thereof not already paid in the
redemption of such Preferred Stock so to be redeemed) with any
bank or trust company in the City of New York, New York, or in
the City of Jackson, Mississippi, named in such notice, payable
to the order of the record holders of the Preferred Stock so to
be redeemed, as the case may be, on the endorsement and surrender
of their certificates, and thereupon said holders shall cease to
be stockholders with respect to such shares; and from and after
the making of such deposit such holders shall have no interest in
or claim against the Corporation with respect to said shares, but
shall be entitled only to receive such moneys from said bank or
trust company, with interest, if any, allowed by such bank or
trust company on such moneys deposited as in this paragraph
provided, on endorsement and surrender of their certificates, as
aforesaid. Any moneys so deposited, plus interest thereon, if
any, remaining unclaimed at the end of six years from the date
fixed for redemption, if thereafter requested by resolution of
the Board of Directors, shall be repaid to the Corporation, and
in the event of such repayment to the Corporation, such holders
of record of the shares so redeemed as shall not have made claim
against such moneys prior to such repayment to the Corporation,
shall be deemed to be unsecured creditors of the Corporation for
an amount, without interest, equivalent to the amount deposited,
plus interest thereon, if any, allowed by such bank or trust
company, as above stated, for the redemption of such shares and
so paid to the Corporation. Shares of the Preferred Stock which
have been redeemed shall not be reissued. If less than all of
the shares of the Preferred Stock are to be redeemed, the shares
thereof to be redeemed shall be selected by lot, in such manner
as the Board of Directors of the Corporation shall determine, by
an independent bank or trust company selected for that purpose by
the Board of Directors of the Corporation. Nothing herein
contained shall limit any legal right of the Corporation to
purchase or otherwise acquire any shares of the Preferred Stock;
provided, however, that, so long as any shares of the Preferred
Stock are outstanding, the Corporation shall not redeem, purchase
or otherwise acquire less than all of the shares of the Preferred
Stock, if, at the time of such redemption, purchase or other
acquisition, dividends payable on the Preferred Stock shall be in
default in whole or in part, unless, prior to or concurrently
with such redemption, purchase or other acquisition, all such
defaults shall be cured or unless such redemption, purchase or
other acquisition shall have been ordered, approved or permitted
under the Public Utility Holding Company Act of 1935; and
provided further that, so long as any shares of the Preferred
Stock are outstanding, the Corporation shall not make any payment
or set aside any funds for payment into any sinking fund for the
purchase or redemption of any shares of the Preferred Stock, if,
at the time of such payment, or the setting apart of funds for
such payment, dividends payable on the Preferred Stock shall be
in default in whole or in part, unless, prior to or concurrently
with such payment or the setting apart of funds for such payment,
all such defaults shall be cured or unless such payment, or the
setting apart of funds for such payment, shall have been ordered,
approved or permitted under the Public Utility Holding Company
Act of 1935. Any shares of the Preferred Stock so redeemed,
purchased or acquired shall retired and cancelled.
(H) For the purposes of this paragraph (H) and subparagraph
(4) of paragraph (D) the term "Common Stock Equity" shall mean
the aggregate of the par value of, or stated capital represented
by, the outstanding shares (other than shares owned by the
Corporation) of stock ranking junior to the Preferred Stock as to
dividends and assets, of the premium on such junior stock and of
the surplus (including earned surplus, capital surplus and
surplus invested in plant) of the Corporation less (1) any
amounts recorded on the books of the Corporation for utility
plant and other plant in excess of the original cost thereof, (2)
unamortized debt discount and expense, capital stock discount and
expense and any other intangible items set forth on the asset
side of the balance sheet as a result of accounting convention,
(3) the excess, if any, of the aggregate amount payable on
involuntary liquidation, dissolution or winding up of the affairs
of the Corporation upon all outstanding preferred stock of the
Corporation over the aggregate par or stated value thereof and
any premiums thereon and (4) the excess, if any, for the period
beginning with January 1, 1954, to the end of the month within
ninety (90) days preceding the date as of which Common Stock
Equity is determined, of the cumulative amount computed under re
quirements contained in the Corporation's mortgage indentures
relating to minimum depreciation provisions (this cumulative
amount being the aggregate of the largest amounts separately
computed for entire periods of differing coexisting mortgage
indenture requirements), over the amount charged by the
Corporation and Mississippi Power & Light Company, a Florida
corporation, on their books for depreciation during such period,
including the final fraction of a year; provided, however, that
no deductions shall be required to be made in respect of items
referred to in subdivisions (1) and (2) of this paragraph (H) in
cases in which such items are being amortized or are provided
for, or are being provided for, by reserves. For the purpose of
this paragraph (H): (i) the term "total capitalization" shall
mean the sum of the Common Stock Equity plus item three (3) in
this paragraph (H) and the stated capital applicable to, and any
premium on, outstanding stock of the Corporation not included in
Common Stock Equity, and the principal amount of all outstanding
debt of the Corporation maturing more than twelve months after
the date of issue thereof; and (ii) the term "dividends on Common
Stock" shall embrace dividends on Common Stock (other than
dividends payable only in shares of Common Stock), distributions
on, and purchases or other acquisitions for value of, any Common
Stock of the Corporation or other stock if any, subordinate to
its Preferred Stock. So long as any shares of the Preferred
Stock are outstanding, the Corporation shall not declare or pay
any dividends on the Common Stock, except as follows:
(a) If and so long as the Common Stock Equity at the
end of the calendar month immediately preceding the date on
which a dividend on Common Stock is declared is, or as a
result of such dividend would become, less than 20% of total
capitalization, the Corporation shall not declare such
dividends in an amount which, together with all other
dividends on Common Stock paid within the year ending with
and including the date on which such dividend is payable,
exceeds 50% of the net income of the Corporation available
for dividends on the Common Stock for the twelve full
calendar months immediately preceding the month in which
such dividends are declared, except in an amount not
exceeding the aggregate of dividends on Common Stock which
under the restrictions set forth above in this subparagraph
(a) could have been, and have not been, declared; and
(b) If and so long as the Common Stock Equity at the
end of the calendar month immediately preceding the date on
which a dividend on Common Stock is declared is, or as a
result of such dividend would become, less than 25% but not
less than 20% of total capitalization, the Corporation shall
not declare dividends on the Common Stock in an amount
which, together with all other dividends on Common Stock
paid within the year ending with and including the date on
which such dividend is payable, exceeds 75% of the net
income of the Corporation and Mississippi Power & Light
Company, a Florida corporation, available for dividends on
the Common Stock for the twelve full calendar months
immediately preceding the month in which such dividends are
declared, except in an amount not exceeding the aggregate of
dividends on Common Stock which under the restrictions set
forth above in subparagraph (a) and in this subparagraph (b)
could have been and have not been declared; and
(c) If any time when the Common Stock Equity is 25% or
more of total capitalization, the Corporation may not
declare dividends on shares of the Common Stock which would
reduce the Common Stock Equity below 25% of total
capitalization, except to the extent provided in
subparagraphs (a) and (b) above.
At anytime when the aggregate of all amounts credited
subsequent to January 1, 1954, to the depreciation reserve
account of the Corporation and Mississippi Power & Light Company,
a Florida corporation, through charges to operating revenue
deductions or otherwise on the books of the Corporation and
Mississippi Power & Light Company, a Florida corporation, shall
be less than the amount computed as provided in clause (aa)
below, under requirements contained in the Corporation's mortgage
indentures, then for the purposes of subparagraphs (a) and (b)
above, in determining the earnings available for common stock
dividends during any twelve-month period, the amount to be
provided for depreciation in that period shall be (aa) the
greater of the cumulative amount charged to depreciation expense
on the books of the Corporation and Mississippi Power & Light
Company, a Florida corporation, or the cumulative amount computer
under requirements contained in the Corporation's mortgage
indentures relating to minimum depreciation provisions (the
latter cumulative amount being the aggregate of the largest
amounts separately computed for entire periods of differing co-
existing mortgage indenture requirements) for the period from
January 1, 1954, to and including said twelve-month period, less
(bb) the greater of the cumulative amount charged to depreciation
expense on the books of the Corporation and Mississippi Power &
Light Company, a Florida corporation, or the cumulative amount
computed under requirements contained in the Corporation's
mortgage indentures relating to minimum depreciation provisions
(the latter cumulative amount being the aggregate of the largest
amounts separately computed for entire periods of differing
coexisting mortgage indenture requirements) from January 1, 1954,
up to but excluding said twelve-month period; provided that in
the event any company other than Mississippi Power & Light
Company, a Florida corporation, is merged into the Corporation
the "cumulative amount computed under requirements contained in
the Corporation's mortgage indentures relating to minimum
depreciation provisions" referred to above shall be computed
without regard, for the period prior to the merger, of property
acquired in the merger, and the "cumulative amount charged to
depreciation expense on the books of the Corporation" shall be
exclusive of amounts provided for such property prior to the
merger.
(I) The Board of Directors are hereby expressly authorized
by resolution or resolutions to state and express the series and
distinctive serial designation of any authorized and unissued
shares of Preferred Stock proposed to be issued, the number of
shares to constitute each such series, the annual rate or rates
of dividends payable on shares of each series together with the
dates on which such dividends shall be paid in each year, the
date from which such dividends shall commence to accumulate, the
amount or amounts payable upon redemption and the sinking fund
provisions, if any, for the redemption or purchase of shares.
(J) Dividends may be paid upon the Common Stock only when (i)
dividends have been paid or declared and funds set apart for the
payment of dividends as aforesaid on the Preferred Stock from the
date(s) after which dividends thereon became cumulative, to the
beginning of the period then current, with respect to which such
dividends on the Preferred Stock are usually declared, and (ii)
all payments have been made or funds have been set aside for
payments then or theretofore due under sinking fund provisions,
if any, for the redemption or purchase of shares of any series of
the Preferred Stock, but whenever (x) there shall have been paid
or declared and funds shall have been set apart for the payment
of all such dividends upon the Preferred Stock as aforesaid, and
(y) all payments shall have been made or funds shall have been
set aside for payments then or theretofore due under sinking fund
provisions, if any, for the redemption or purchase of shares of
any series of the Preferred Stock, then, subject to the
limitations above set forth, dividends upon the Common Stock may
be declared payable then or thereafter, out of any net earnings
or surplus of assets over liabilities, including capital, then
remaining. After the payment of the limited dividends and/or
shares in distribution of assets to which the Preferred Stock is
expressly entitled in preference to the Common Stock, in
accordance with the provisions hereinabove set forth, the Common
Stock alone (subject to the rights of any class of stock
hereafter authorized) shall receive all further dividends and
shares in distribution.
(K) Subject to the limitations hereinabove set forth the
Corporation from time to time may resell any of its own stock,
purchased or otherwise acquired by it as hereinafter provided
for, at such price as may be fixed by its Board of Directors or
Executive Committee.
(L) Subject to the limitations hereinabove set forth the
Corporation in order to acquire funds with which to redeem any
outstanding Preferred Stock of any class, may issue and sell
stock of any class then authorized but unissued, bonds, notes,
evidences of indebtedness, or other securities.
(M) Subject to the limitations hereinabove set forth the
Board of Directors of the Corporation may at any time authorize
the conversion or exchange of the whole or any particular share
of the outstanding preferred stock of any class with the consent
of the holder thereof, into or for stock of any other class at
the time of such consent authorized but unissued and may fix the
terms and conditions upon which such conversion or exchange may
be made; provided that without the consent of the holders of
record of two-thirds of the shares of Common Stock outstanding
given at a meeting of the holders of the Common Stock called and
held as provided by the By-Laws or given in writing without a
meeting, the Board of Directors shall not authorize the
conversion or exchange of any preferred stock of any class into
or for Common Stock or authorize the conversion or exchange of
any preferred stock; of any class into or for preferred stock of
any other class, if by such conversion or exchange the amount
which the holders of the shares of stock so converted or
exchanged would be entitled to receive either as dividends or
shares in distribution of assets in preference to the Common
Stock would be increased.
(N) A consolidation, merger or amalgamation of the
Corporation with or into any other corporation or corporations
shall not be deemed a distribution of assets of the Corporation
within the meaning of any provisions of these Restated Articles
of Incorporation.
(O) The consideration received by the Corporation from the
sale of any additional stock without nominal or par value shall
be entered in the Corporation's capital stock account.
(P) Subject to the limitations hereinabove set forth upon
the vote of a majority of all the Directors of the Corporation
and of a majority of the total number of shares of stock then
issued and outstanding and entitled to vote, irrespective of
class (or if the vote of a larger number or different proportion
of shares is required by the laws of the State of Mississippi not
withstanding the above agreement of the stockholders of the
Corporation to the contrary, then upon the vote of the larger
number or different proportion of shares so required), the
Corporation may from time to time create or authorize one or more
other classes of stock with such preferences, designations,
rights, privileges, powers, restrictions, limitations and qualifi
cations as may be determined by said vote, which may be the same
as or different from the preferences, designations, rights,
privileges, powers, restrictions, limitations and qualifications
of the classes of stock of the Corporation then authorized. Any
such vote authorizing the creation of a new class of stock may
provide that all moneys payable by the Corporation with respect
to any class of stock thereby authorized shall be paid in the
money of any foreign country named therein or designated by the
Board of Directors, pursuant to authority therein granted, at a
fixed rate of exchange with the money of the United States of
America therein stated or provided for and all such payments
shall be made accordingly. Any such vote may authorize any shares
of any class then authorized but unissued to be issued as shares
of such new class or classes
(Q) Subject to the limitations hereinabove set forth, either
the Preferred Stock or the Common Stock or both of said classes
of stock, may be increased at any time upon vote of the holders
of a majority of the total number of shares of the Corporation
then issued and outstanding and entitled to vote thereon,
irrespective of class.
(R) If any provisions in this Section Fourth shall be in
conflict or inconsistent with any other provisions of these
Restated Articles of Incorporation of the Corporation the
provisions of this Section Fourth shall prevail and govern.
FIFTH: The Corporation will not commence business until at
least $1,000 has been received by it as consideration for the
issuance of shares.
SIXTH: Existing provisions limiting or denying to
shareholders the preemptive right to acquire additional or
treasury shares of the Corporation are:
No holder of any stock of the Corporation shall be entitled
as of right to purchase or subscribe for any part of any unissued
stock of the Corporation, or any additional stock of any class to
be issued by reason of any increase of the authorized capital
stock of the Corporation or of bonds, certificates of
indebtedness, debentures, or other securities convertible into
stock of the Corporation, but any such unissued stock or any such
additional authorized issue of new stock, or of securities
convertible into stock, may be issued and disposed of by the
Board of Directors without offering to the stockholders then of
record, or to any class of stockholders, any thereof on any
terms.
SEVENTH: Existing provisions of the Restated Articles of
Incorporation for the regulation of the internal affairs of the
Corporation are:
(a) General authority is hereby conferred upon the
Board of Directors to fix the consideration for which shares
of stock of the Corporation without nominal or par value may
be issued and disposed of, and the shares of stock of the
Corporation without nominal or par value, whether authorized
by these Restated Articles of Incorporation or by subsequent
increase of the authorized number of shares of stock or by
amendment of these Restated Articles of Incorporation by
consolidation or merger or otherwise, and/or any securities
convertible into stock of the Corporation without nominal or
par value may be issued and disposed of for such
consideration and on such terms and in such manner as may be
fixed from time to time by the Board of Directors.
(b) The issue of the whole, or any part determined by
the Board of Directors, of the shares of stock of the
Corporation as partly paid, and subject to calls thereon
until the whole thereof shall have been paid, is hereby
authorized.
(c) The Board of Directors shall have power to
authorize the payment of compensation to the directors for
services to the Corporation, including fees for attendance
at meetings of the Board of Directors or the Executive
Committee and all other committees and to determine the
amount of such compensation and fees.
(d) The Corporation may issue a new certificate of
stock in the place of any certificate theretofore issued by
it, alleged to have been lost or destroyed and the Board of
Directors may, in their discretion, require the owner of the
lost or destroyed certificate, or his legal representative,
to give bond in such sum as they may direct as indemnity
against any claim that may be made against the Corporation,
its officers, employees or agents by reason thereof; a new
certificate may be issued without requiring any bond when,
in the judgment of the directors, it is proper so to do.
If the Corporation shall neglect or refuse to issue
such a new certificate and it shall appear that the owner
thereof has applied to the Corporation for a new certificate
in place thereof and has made due proof of the loss or
destruction thereof and has given such notice of his
application for such new certificate on such newspaper of
general circulation, published in the State of Mississippi
as reasonably should be approved by the Board of Directors,
and in such other newspaper as may be required by the Board
of Directors, and has tendered to the Corporation adequate
security to indemnify the Corporation, its officers
employees, or agents, and any person other than such
applicant who shall thereafter appear to be the lawful owner
of such alleged lost or destroyed certificate against
damage, loss or expense because of the issuance of such new
certificate, and the effect thereof as herein provided,
then, unless there is adequate cause why such new
certificate shall not be issued, the Corporation, upon the
receipt of said indemnity, shall issue a new certificate of
stock in place of such lost or destroyed certificate. In the
event that the Corporation shall nevertheless refuse to
issue a new certificate as aforesaid, the applicant may then
petition any court of competent jurisdiction for relief
against the failure of the Corporation to perform its
obligations hereunder. In the event that the Corporation
shall issue such new certificate, any person who shall
thereafter claim any rights under the certificate in place
of which such new certificate is issued, whether such new
certificate is issued pursuant to the judgment or decree of
such court or voluntarily by the Corporation after the
publication of notice and the receipt of proof and indemnity
as aforesaid, shall have recourse to such indemnity and the
Corporation shall be discharged from all liability to such
person by reason of such certificate and the shares
represented thereby.
(e) No stockholder shall have any right to inspect any
account, book or document of the Corporation, except as
conferred by statute or authorized by the directors.
(f) A director of the Corporation shall not be
disqualified by his office from dealing or contracting with
the Corporation either as a vendor, purchaser or otherwise,
nor shall any transaction or contract of the Corporation be
void or voidable by reason of the fact that any director or
any firm of which any director is a member or any
corporation of which any director is a shareholder, officer
or director, is in any way interested in such transaction or
contract, provided that such transaction or contract is or
shall be authorized, ratified or approved either (1) by a
vote of a majority of a quorum of the Board of Directors or
the Executive Committee, without counting in such majority
or quorum any directors so interested or members of a firm
so interested or a shareholder, officer or director of a
corporation so interested, or (2) by the written consent, or
by vote at a stockholders' meeting of the holders of record
of a majority in number of all the outstanding shares of
stock of the Corporation entitled to vote; nor shall any
director be liable to account to the Corporation for any
profits realized by or from or through any such transaction
or contract of the Corporation, authorized, ratified or
approved as aforesaid by reason of the fact that he or any
firm of which he is a member or any corporation of which he
is a shareholder, officer or director was interested in such
transaction or contract. Nothing herein contained shall
create any liability in the events above described or
prevent the authorization, ratification or approval of such
contract in any other manner provided by law.
(g) Any director may be removed, whether cause shall be
assigned for his removal or not, and his place filled at any
meeting of the stockholders by the vote of a majority of the
outstanding stock of the Corporation entitled to vote.
Vacancies in the Board of Directors, except vacancies
arising from the removal of directors, shall be filed by the
directors remaining in office.
(h) Any property of the Corporation not essential to
the conduct of its corporate business and purposes may be
sold, leased, exchanged or otherwise disposed of by
authority of its Board of Directors and the Corporation may
sell, lease or exchange all of its property and franchises
or any of its property, franchises, corporate rights or
privileges essential to the conduct of its corporate
business and purposes upon the consent of and for such
considerations and upon such terms as may be authorized by a
majority of the Board of Directors and the holders of a
majority of the outstanding shares of stock entitled to
vote, expressed in writing or by vote at a meeting called
for that purpose in the manner provided by the By-Laws of
the Corporation for special meetings of stockholders; and at
no time shall any of the plants, properties, easements,
franchises (other than corporate franchises) or securities
then owned by the Corporation be deemed to be property,
franchises, corporate rights or privileges essential to the
conduct of the corporate business and purposes of the
Corporation.
Upon the vote or consent of the stockholders required
to dissolve the Corporation, the Corporation shall have
power, as the attorney and agent of the holders of all of
its outstanding stock, to sell, assign and transfer all such
stock to a new corporation organized under the laws of the
United States, the State of Mississippi or any other state,
and to receive as the consideration therefor shares of stock
of such new corporation of the several classes into which
the stock of the Corporation is then divided, equal in
number to the number of shares of stock of the Corporation
of said several classes then outstanding, such shares of
said new corporation to have the same preferences, voting
powers, restrictions and qualifications thereof as may then
attach to the classes of stock of the Corporation then
outstanding so far as the same shall be consistent with such
laws of the United States or of the State of Mississippi or
of such other state, except that the whole or any part of
such stock or any class thereof may be stock with or without
nominal or par value. In order to make effective such a
sale, assignment and transfer, the Corporation shall have
the right to transfer all its outstanding stock on its books
and to issue and deliver new certificates therefor in such
names and amounts as such new corporation may direct without
receiving for cancellation the certificates for such stock
previously issued and then outstanding. Upon completion of
such sale, assignment and transfer, the holders of the stock
of the Corporation shall have no rights or interests in or
against the Corporation except the right, upon surrender of
certificates for stock of the Corporation properly endorsed,
if required, to receive from the Corporation certificates
for shares of stock of such new corporation of the class
corresponding to the class of the shares surrendered, equal
in number to the number of shares of the stock of the
Corporation so surrendered.
(i) Upon the written assent or pursuant to the
affirmative vote in person or by proxy of the holders of a
majority in number of the shares then outstanding and
entitled to vote, irrespective of class, (1) any or every
statute of the State of Mississippi hereafter enacted,
whereby the rights, powers or privileges of the Corporation
are or may be increased, diminished or in any way affected
or whereby the rights, powers or privileges of the
stockholders of corporations organized under the law under
which the Corporation is organized, are increased,
diminished or in any way affected or whereby effect is given
to the action taken by any part, less than all, of the
stockholders of any such corporation, shall, notwithstanding
any provisions which may at the time be contained in these
Restated Articles of Incorporation or any law, apply to the
Corporation, and shall be binding not only upon the
Corporation, but upon every stockholder thereof, to the same
extent as if such statute had been in force at the date of
the making and filing of these Restated Articles of
Incorporation and/or (2) amendments of these Restated
Articles of Incorporation authorized at the time of the
making of such amendments by the laws of the State of
Mississippi may be made.
EIGHTH: The Restated Articles of Incorporation correctly set
forth without change the corresponding provisions of the Articles
of Incorporation as heretofore amended and restated, and
supersede the original Articles of Incorporation, and all
amendments thereto, and prior Restated Articles of Incorporation
and all amendments thereto.
DATED: December 21, 1983.
MISSISSIPPI POWER & LIGHT COMPANY
By: D. C. LUTKEN
Its President
[CORPORATE SEAL]
By: F. S. YORK, JR.
Its Secretary
STATE OF MISSISSIPPI
COUNTY OF HINDS
I, Bethel Ferguson, a Notary Public, do hereby certify that
on this 21st day of December, 1983, personally appeared before me
D. C. Lutken. who, being by me first duly sworn, declared that he
is the President of Mississippi Power & Light Company, that he
signed the foregoing document as President of the Corporation,
and that the statements therein contained are true.
BETHEL FERGUSON
Notary Public
My commission expires July 23, 1987.
[NOTARY'S SEAL]
RESTATED ARTICLES OF INCORPORATION
of
MISSISSIPPI POWER & LIGHT COMPANY
Filing and Recording Data
Restated Articles of Incorporation filed with Secretary of State-
- - - - -December 21, 1983
Certificate of Restated Articles of Incorporation issued by
Secretary of State--December 21, 1983
Certificate of Restated Articles of Incorporation and Restated
Articles of Incorporation filed for record in the office of the
Chancery Clerk of the First Judicial District of Hinds County,
Mississippi, Book 189, Page 624--December 22, 1983.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Resolution Establishing Series of Shares
October 25, 1984
Pursuant to the provisions of Section 79-3-29 of the
Mississippi Business Corporation Law, the undersigned Corporation
submits the following statement for the purpose of establishing
and designating a series of shares and fixing and determining the
relative rights and preferences thereof:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The attached resolution establishing and designating a
series of shares and fixing and determining the relative
rights and preferences thereof was duly adopted by the
Board of Directors of the Corporation on October 24,
1984.
Dated this the 25th day of October, 1984.
MISSISSIPPI POWER & LIGHT COMPANY
By/s/ William Cavanaugh, III
William Cavanaugh, III
President
By /s/ Frank S. York, Jr.
Frank S. York, Jr.
Senior Vice President,
Chief Financial Officer
and Secretary
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this October 25, 1984, personally appeared before me William
Cavanaugh, III, who, being by me first duly sworn, declared that
he is President of Mississippi Power & Light Company, that he
executed the foregoing document as President of the Corporation,
and that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
March 30, 1986
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this October 25, 1984, personally appeared before me Frank S.
York, Jr., who, being by me first duly sworn, declared that he is
Senior Vice President, Chief Financial Officer and Secretary of
Mississippi Power & Light Company, that he executed the foregoing
document as Senior Vice President, Chief Financial Officer and
Secretary of the Corporation, and that the statements therein
contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
March 30, 1986
RESOLVED That there is hereby established a series of the
Preferred Stock of Mississippi Power & Light Company as follows:
A series of 150,000 shares of the Preferred Stock shall:
(a) be designated "16.16% Preferred Stock, Cumulative, $100
Par Value;"
(b) have a dividend rate of $16.16 per share per annum
payable quarterly on February 1, May 1, August 1, and November 1
of each year, the first dividend date to be February 1, 1986, and
such dividends to be cumulative from the date of issuance;
(c) be subject to redemption at the price of $116.16 per
share if redeemed on or before November 1, 1989, of $112.12 per
share if redeemed after November 1, 1989, and on or before
November 1, 1994, of $108.08 per share if redeemed after November
1, 1994, and on or before November 1, 1999, and of $104.04 per
share if redeemed after November 1, 1999, in each case plus an
amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date fixed for redemption; provided,
however, that no share of the 16.16% Preferred Stock, Cumulative,
$100 Par Value, shall be redeemed prior to November 1, 1989, if
such redemption is for the purpose or in anticipation of
refunding such share through the use, directly or indirectly, of
funds borrowed by the Corporation, or through the use, directly
or indirectly, of funds derived through the issuance by the
Corporation of stock ranking prior to or on a parity with the
16.16% Preferred Stock, Cumulative, $100 Par Value, as to
dividends or assets, if such borrowed funds have an effective
interest cost to the Corporation (computed in accordance with
generally accepted financial practice) or such stock has an
effective dividend cost to the Corporation (so computed) of less
than 16.2772% per annum; and
(d) be subject to redemption as and for a sinking fund as
follows: on November 1, 1989 and on each November 1 thereafter
(each such date being hereinafter referred to as a "16.16%
Sinking Fund Redemption Date"), for so long as any shares of the
16.16% Preferred Stock, Cumulative, $100 Par Value, shall remain
outstanding, the Corporation shall redeem, out of funds legally
available therefor, 7,500 shares of the 16.16% Preferred Stock,
Cumulative, $100 Par Value, (or the number of shares than
outstanding if less than 7,500) at the sinking fund redemption
price of $100 per share plus, as to each share so redeemed, an
amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date of redemption (the obligation of the
Corporation so to redeem the shares of the 16.16% Preferred
Stock, Cumulative, $100 Par Value, being hereinafter referred to
as the "16.16% Sinking Fund Obligation"); the 16.16% Sinking Fund
Obligation shall be cumulative; if on any 16.16% Sinking Fund
Redemption Date, the Corporation shall not have funds legally
available therefor sufficient to redeem the full number of shares
required to be redeemed on that date, the 16.16% Sinking Fund
Obligation with respect to the shares not redeemed shall carry
forward to each successive 16.16% Sinking Fund Redemption Date
until such shares shall have been redeemed; whenever on any
16.16% Sinking Fund Redemption Date, the funds of the Corporation
legally available for the satisfaction of the 16.16% Sinking Fund
Obligation and all other sinking fund and similar obligations
than existing with respect to any other class or series of its
stock ranking on a parity as to dividends or assets with the
16.16% Preferred Stock, Cumulative, $100 Par Value (such
obligation and obligations collectively being hereinafter
referred to as the "Total Sinking Fund Obligations"), are
insufficient to permit the Corporation to satisfy fully its Total
Sinking Fund Obligation on that date, the Corporation shall apply
to the satisfaction on its 16.16% Sinking Fund Obligation on that
date that proportion of such legally available funds which is
equal to the ratio of such 16.16% Sinking Fund Obligation to such
Total Sinking Fund Obligation; in addition to the 16.16% Sinking
Fund Obligation, the Corporation shall have the option, which
shall be noncumulative, to redeem, upon authorization of the
Board of Directors, on each 16.16% Sinking Fund Redemption Date,
at the aforesaid sinking fund redemption price, up to 7,500
additional shares of the 16.16% Preferred Stock, Cumulative $100
Par Value; the Corporation shall be entitled, at its election, to
credit against its 16.16% Sinking Fund Obligation on any 16.16%
Sinking Fund Redemption Date any shares of the Preferred Stock,
Cumulative, $100 Par Value (including shares of the 16.16%
Preferred Stock, Cumulative, $100 Par Value, optionally redeemed
at the aforesaid sinking fund price) theretofore redeemed (other
than shares of the 16.16% Preferred Stock, Cumulative, $100 Par
Value, redeemed pursuant to the 16.16% Sinking Fund Obligation)
purchased or otherwise acquired and not previously credited
against the 16.16% Sinking Fund Obligation.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Resolution Establishing Series of Shares
July 24, 1986
Pursuant to the provisions of Section 79-3-29 of the
Mississippi Code of 1972, the undersigned Corporation submits the
following statement for the purpose of establishing and
designating a series of shares and fixing and determining the
relative rights and preferences thereof:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The attached resolution establishing and designating a
series of shares and fixing and determining the relative
rights and preferences thereof was duly adopted by the
Board of Directors of the Corporation on July 24, 1986.
Dated this the 24th day of July, 1986.
MISSISSIPPI POWER & LIGHT COMPANY
By/s/ William Cavanaugh, III
William Cavanaugh, III
President
By /s/ Frank S. York, Jr.
Frank S. York, Jr.
Senior Vice President,
Chief Financial Officer
and Secretary
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joseph L. Blount, a Notary Public, do hereby certify that
on this July 24, 1986, personally appeared before me William
Cavanaugh, III, who, being by me first duly sworn, declared that
he is President of Mississippi Power & Light Company, a
Mississippi corporation, that he executed the foregoing document
as President of the Corporation, and that the statements therein
contained are true.
/s/ Joseph L. Blount
Joseph L. Blount, Notary Public
My Commission Expires:
January 20, 1990
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joseph L. Blount, a Notary Public, do hereby certify that
on this July 24, 1986, personally appeared before me Frank S.
York, Jr., who, being by me first duly sworn, declared that he is
Senior Vice President, Chief Financial Officer and Secretary of
Mississippi Power & Light Company, a Mississippi corporation,
that he executed the foregoing document as Senior Vice President,
Chief Financial Officer and Secretary of the Corporation, and
that the statements therein contained are true.
/s/ Joseph L. Blount
Joseph L. Blount, Notary Public
My Commission Expires:
January 20, 1990
RESOLVED That there is hereby established a series of the
Preferred Stock of Mississippi Power & Light Company as follows:
A series of 350,000 shares of the Preferred Stock shall:
(a) be designated "9% Preferred Stock, Cumulative, $100 Par
Value;"
(b) have a dividend rate of $9.00 per share per annum
payable quarterly on February 1, May 1, August 1, and November 1
of each year, the first dividend date to be November 1, 1986, and
such dividends to be cumulative from the date of issuance;
(c) be subject to redemption at the price of $109.00 per
share if redeemed on or before July 1, 1991, of $106.75 per share
if redeemed after July 1, 1991, in each case plus an amount
equivalent to the accumulated and unpaid dividends thereon, if
any, to the date fixed for redemption; provided, however, that no
share of the 9% Preferred Stock, Cumulative, $100 Par Value,
shall be redeemed prior to July 1, 1991, if such redemption is
for the purpose or in anticipation of refunding such share
through the use, directly or indirectly, of funds borrowed by the
Corporation, or through the use, directly or indirectly, of funds
derived through the issuance by the Corporation of stock ranking
prior to or on a parity with the 9% Preferred Stock, Cumulative,
$100 Par Value, as to dividends or assets, if such borrowed funds
have an effective interest cost to the Corporation (computed in
accordance with generally accepted financial practice) or such
stock has an effective dividend cost to the Corporation (so
computed) of less than 9.9901% per annum; and
(d) be subject to redemption as and for a sinking fund as
follows: on July 1, 1991, and on each July 1 thereafter (each
such date being hereinafter referred to as a "9% Sinking Fund
Redemption Date"), for so long as any shares of the 9% Preferred
Stock, Cumulative, $100 Par Value, shall remain outstanding, the
Corporation shall redeem, out of funds legally available
therefor, 70,000 shares of the 9% Preferred Stock, Cumulative,
$100 Par Value, (or the number of shares than outstanding if less
than 70,000) at the sinking fund redemption price of $100 per
share plus, as to each share so redeemed, an amount equivalent to
the accumulated and unpaid dividends thereon, if any, to the date
of redemption (the obligation of the Corporation so to redeem the
shares of the 9% Preferred Stock, Cumulative, $100 Par Value,
being hereinafter referred to as the "9% Sinking Fund
Obligation"); the 9% Sinking Fund Obligation shall be cumulative;
if on any 9.% Sinking Fund Redemption Date, the Corporation shall
not have funds legally available therefor sufficient to redeem
the full number of shares required to be redeemed on that date,
the 9% Sinking Fund Obligation with respect to the shares not
redeemed shall carry forward to each successive 9% Sinking Fund
Redemption Date until such shares shall have been redeemed;
whenever on any 9% Sinking Fund Redemption Date, the funds of the
Corporation legally available for the satisfaction of the 9%
Sinking Fund Obligation and all other sinking fund and similar
obligations than existing with respect to any other class or
series of its stock ranking on a parity as to dividends or assets
with the 9% Preferred Stock, Cumulative, $100 Par Value (such
obligation and obligations collectively being hereinafter
referred to as the "Total Sinking Fund Obligations"), are
insufficient to permit the Corporation to satisfy fully its Total
Sinking Fund Obligation on that date, the Corporation shall apply
to the satisfaction on its 9% Sinking Fund Obligation on that
date that proportion of such legally available funds which is
equal to the ratio of such 9% Sinking Fund Obligation to such
Total Sinking Fund Obligation; the Corporation shall be entitled,
at its election, to credit against its 9% Sinking Fund Obligation
on any 9% Sinking Fund Redemption Date any shares of the
Preferred Stock, Cumulative, $100 Par Value, theretofore
redeemed (other than shares of the 9% Preferred Stock,
Cumulative, $100 Par Value, redeemed pursuant to the 9% Sinking
Fund Obligation) purchased or otherwise acquired and not
previously credited against the 9% Sinking Fund Obligation.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Cancellation of Shares
September 1, 1986
Pursuant to the provisions of Section 79-3-133 of the
Mississippi Code of 1972, the undersigned Corporation submits the
following statement of cancellation of redeemable shares by
redemption:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The number of redeemable shares cancelled through
redemption is 20,000 shares of 17% preferred stock,
cumulative, $100 par value.
3. The aggregate number of issued shares, itemized by class
and series, after giving effect to such cancellation is
as follows:
(a) 6,275,000 shares of common stock, without par
value;
(b) 59,920 shares of 4.36% preferred stock, cumulative,
$100 par value;
(c) 43,888 shares of 4.56% preferred stock, cumulative,
$100 par value;
(d) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(e) 75,000 shares of 9.16% preferred stock, cumulative,
$100 par value;
(f) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(g) 180,000 shares of 17% preferred stock, cumulative,
$100 par value;
(h) 100,000 shares of 14.75% preferred stock,
cumulative, $100 par value;
(i) 100,000 shares of 12% preferred stock, cumulative,
$100 par value;
(j) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(k) 350,000 shares of 9% preferred stock, cumulative,
$100 par value;
4. The amount, expressed in dollars, of the stated capital
of the Corporation, after giving effect to such
cancellation is $270,205,800.00.
5. The Restated Articles of Incorporation of the
Corporation provide that the cancelled shares shall not
be reissued, and the number of shares which the
Corporation has authority to issue, itemized by class,
after giving effect to such cancellation, is as follows:
(a) 15,000,000 shares of common stock, without par
value, 6,275,000 of such shares being issued and
outstanding at the date hereof; and
(b) 1,984,476 shares of preferred stock, 1,258,808
shares of which are issued and outstanding as
outlined above.
Dated this the 10th day of December, 1986.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ Frank S. York, Jr.
Frank S. York, Jr.
Senior Vice President,
Chief Financial Officer
and Secretary
By /s/ A. H. Mapp
A. H. Mapp
Assistant Secretary and
Assistant Treasurer
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me
Frank S. York, Jr., who, being by me first duly sworn, declared
that he is Senior Vice President, Chief Financial Officer and
Secretary of Mississippi Power & Light Company, a Mississippi
corporation, that he executed the foregoing document as Senior
Vice President, Chief Financial Officer and Secretary of the
Corporation, and that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me A.
H. Mapp, who, being by me first duly sworn, declared that he is
Assistant Secretary and Assistant Treasurer of Mississippi Power
& Light Company, a Mississippi corporation, that he executed the
foregoing document as Senior Vice President, Chief Financial
Officer and Secretary of the Corporation, and that the statements
therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Cancellation of Shares
November 1, 1986
Pursuant to the provisions of Section 79-3-133 of the
Mississippi Code of 1972, the undersigned Corporation submits the
following statement of cancellation of redeemable shares by
redemption:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The number of redeemable shares cancelled through
redemption is 180,000 shares of 17% preferred stock,
cumulative, $100 par value.
3. The aggregate number of issued shares, itemized by class
and series, after giving effect to such cancellation is
as follows:
(a) 6,275,000 shares of common stock, without par
value;
(b) 59,920 shares of 4.36% preferred stock, cumulative,
$100 par value;
(c) 43,888 shares of 4.56% preferred stock, cumulative,
$100 par value;
(d) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(e) 75,000 shares of 9.16% preferred stock, cumulative,
$100 par value;
(f) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(g) 100,000 shares of 14.75% preferred stock,
cumulative, $100 par value;
(h) 100,000 shares of 12% preferred stock, cumulative,
$100 par value;
(i) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(j) 350,000 shares of 9% preferred stock, cumulative,
$100 par value;
4. The amount, expressed in dollars, of the stated capital
of the Corporation, after giving effect to such
cancellation is $252,205,800.00.
5. The Restated Articles of Incorporation of the
Corporation provide that the cancelled shares shall not
be reissued, and the number of shares which the
Corporation has authority to issue, itemized by class,
after giving effect to such cancellation, is as follows:
(a) 15,000,000 shares of common stock, without par
value, 6,275,000 of such shares being issued and
outstanding at the date hereof; and
(b) 1,804,476 shares of preferred stock, 1,078,808
shares of which are issued and outstanding as
outlined above.
Dated this the 10th day of December, 1986.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ Frank S. York, Jr.
Frank S. York, Jr.
Senior Vice President,
Chief Financial Officer
and Secretary
By /s/ A. H. Mapp
A. H. Mapp
Assistant Secretary and
Assistant Treasurer
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me
Frank S. York, Jr., who, being by me first duly sworn, declared
that he is Senior Vice President, Chief Financial Officer and
Secretary of Mississippi Power & Light Company, a Mississippi
corporation, that he executed the foregoing document as Senior
Vice President, Chief Financial Officer and Secretary of the
Corporation, and that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me A.
H. Mapp, who, being by me first duly sworn, declared that he is
Assistant Secretary and Assistant Treasurer of Mississippi Power
& Light Company, a Mississippi corporation, that he executed the
foregoing document as Senior Vice President, Chief Financial
Officer and Secretary of the Corporation, and that the statements
therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Cancellation of Shares
November 1, 1986
Pursuant to the provisions of Section 79-3-133 of the
Mississippi Code of 1972, the undersigned Corporation submits the
following statement of cancellation of redeemable shares by
redemption:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The number of redeemable shares cancelled through
redemption is 100,000 shares of 14.75% preferred stock,
cumulative, $100 par value.
3. The aggregate number of issued shares, itemized by class
and series, after giving effect to such cancellation is
as follows:
(a) 6,275,000 shares of common stock, without par
value;
(b) 59,920 shares of 4.36% preferred stock, cumulative,
$100 par value;
(c) 43,888 shares of 4.56% preferred stock, cumulative,
$100 par value;
(d) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(e) 75,000 shares of 9.16% preferred stock, cumulative,
$100 par value;
(f) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(g) 100,000 shares of 12% preferred stock, cumulative,
$100 par value;
(h) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(i) 350,000 shares of 9% preferred stock, cumulative,
$100 par value;
4. The amount, expressed in dollars, of the stated capital
of the Corporation, after giving effect to such
cancellation is $242,205,800.00.
5. The Restated Articles of Incorporation of the
Corporation provide that the cancelled shares shall not
be reissued, and the number of shares which the
Corporation has authority to issue, itemized by class,
after giving effect to such cancellation, is as follows:
(a) 15,000,000 shares of common stock, without par
value, 6,275,000 of such shares being issued and
outstanding at the date hereof; and
(b) 1,704,476 shares of preferred stock, 978,808 shares
of which are issued and outstanding as outlined
above.
Dated this the 10th day of December, 1986.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ Frank S. York, Jr.
Frank S. York, Jr.
Senior Vice President,
Chief Financial Officer
and Secretary
By /s/ A. H. Mapp
A. H. Mapp
Assistant Secretary and
Assistant Treasurer
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me
Frank S. York, Jr., who, being by me first duly sworn, declared
that he is Senior Vice President, Chief Financial Officer and
Secretary of Mississippi Power & Light Company, a Mississippi
corporation, that he executed the foregoing document as Senior
Vice President, Chief Financial Officer and Secretary of the
Corporation, and that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this 10th day of December, 1986, personally appeared before me A.
H. Mapp, who, being by me first duly sworn, declared that he is
Assistant Secretary and Assistant Treasurer of Mississippi Power
& Light Company, a Mississippi corporation, that he executed the
foregoing document as Senior Vice President, Chief Financial
Officer and Secretary of the Corporation, and that the statements
therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Statement of Resolution Establishing Series of Shares
January 13, 1987
Pursuant to the provisions of Section 79-3-29 of the
Mississippi Code of 1972, the undersigned Corporation submits the
following statement for the purpose of establishing and
designating a series of shares and fixing and determining the
relative rights and preferences thereof:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The attached resolution establishing and designating a
series of shares and fixing and determining the relative
rights and preferences thereof was duly adopted by the
Board of Directors of the Corporation on January 13,
1987.
Dated this the 13th day of January, 1987.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ D. C. Lutken
D. C. Lutken
President, Chairman of
the Board and Chief
Executive Officer
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this January 13, 1987, personally appeared before me D. C.
Lutken, who, being by me first duly sworn, declared that he is
President, Chairman of the Board and Chief Executive Officer of
Mississippi Power & Light Company, a Mississippi corporation,
that he executed the foregoing document as President, Chairman of
the Board and Chief Executive Officer of the Corporation, and
that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
STATE OF MISSISSIPPI
COUNTY OF MINDS
I, Joy L. Spears, a Notary Public, do hereby certify that on
this January 13, 1987, personally appeared before me G. A. Goff,
who, being by me first duly sworn, declared that he is Senior
Vice President, Chief Financial Officer and Secretary of
Mississippi Power & Light Company, a Mississippi corporation,
that he executed the foregoing document as Senior Vice President,
Chief Financial Officer and Secretary of the Corporation, and
that the statements therein contained are true.
/s/ Joy L. Spears
Joy L. Spears, Notary Public
My Commission Expires:
________________________
RESOLVED That there is hereby established a series of the
Preferred Stock of Mississippi Power & Light Company as follows:
A series of 350,000 shares of the Preferred Stock shall:
(a) be designated "9.76% Preferred Stock, Cumulative, $100
Par Value;"
(b) have a dividend rate of $9.76 per share per annum
payable quarterly on February 1, May 1, August 1, and November 1
of each year, the first dividend date to be May 1, 1987, and such
dividends to be cumulative from the date of issuance;
(c) be subject to redemption at the price of $109.76 per
share if redeemed on or before January 1, 1988, of $108.68 per
share if redeemed after January 1, 1988, and on or before January
1, 1989, of $107.60 per share if redeemed after January 1, 1989,,
and on or before January 1, 1990, of $106.51 per share if
redeemed after January 1, 1990, and on or before January 1, 1991,
of $105.43 per share if redeemed after January 1, 1991, and on or
before January 1, 1992, of $104.34 per share if redeemed after
January 1, 1992, and on or before January 1, 1993, of $103.26 per
share if redeemed after January 1, 1993, and on or before January
1, 1994, of $102.17 per share if redeemed after January 1, 1994,
and on or before January 1, 1995, of $101.09 per share if
redeemed after January 1, 1995, and on or before January 1, 1996,
and of $100.00 per share if redeemed after January 1, 1996, in
each case plus an amount equivalent to the accumulated and unpaid
dividends thereon, if any, to the date fixed for redemption;
provided, however, that no share of the 9.76% Preferred Stock,
Cumulative, $100 Par Value, shall be redeemed prior to January 1,
1992, if such redemption is for the purpose or in anticipation of
refunding such share through the use, directly or indirectly, of
funds borrowed by the Corporation, or through the use, directly
or indirectly, of funds derived through the issuance by the
Corporation of stock ranking prior to or on a parity with the
9.76% Preferred Stock, Cumulative, $100 Par Value, as to
dividends or assets, if such borrowed funds have an effective
interest cost to the Corporation (computed in accordance with
generally accepted financial practice) or such stock has an
effective dividend cost to the Corporation (so computed) of less
than 9.9165% per annum; and
(d) be subject to redemption as and for a sinking fund as
follows: on January 1, 1993, and on each January 1 thereafter
(each such date being hereinafter referred to as a "9.76% Sinking
Fund Redemption Date"), for so long as any shares of the 9.76%
Preferred Stock, Cumulative, $100 Par Value, shall remain
outstanding, the Corporation shall redeem, out of funds legally
available therefor, 70,000 shares of the 9.76% Preferred Stock,
Cumulative, $100 Par Value, (or the number of shares than
outstanding if less than 70,000) at the sinking fund redemption
price of $100 per share plus, as to each share so redeemed, an
amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date of redemption (the obligation of the
Corporation so to redeem the shares of the 9.76% Preferred Stock,
Cumulative, $100 Par Value, being hereinafter referred to as the
"9.76% Sinking Fund Obligation"); the 9.76% Sinking Fund
Obligation shall be cumulative; if on any 9.76% Sinking Fund
Redemption Date, the Corporation shall not have funds legally
available therefor sufficient to redeem the full number of shares
required to be redeemed on that date, the 9.76% Sinking Fund
Obligation with respect to the shares not redeemed shall carry
forward to each successive 9.76% Sinking Fund Redemption Date
until such shares shall have been redeemed; whenever on any 9.76%
Sinking Fund Redemption Date, the funds of the Corporation
legally available for the satisfaction of the 9.76% Sinking Fund
Obligation and all other sinking fund and similar obligations
than existing with respect to any other class or series of its
stock ranking on a parity as to dividends or assets with the
9.76% Preferred Stock, Cumulative, $100 Par Value (such
obligation and obligations collectively being hereinafter
referred to as the "Total Sinking Fund Obligations"), are
insufficient to permit the Corporation to satisfy fully its Total
Sinking Fund Obligation on that date, the Corporation shall apply
to the satisfaction on its 9.76% Sinking Fund Obligation on that
date that proportion of such legally available funds which is
equal to the ratio of such 9.76% Sinking Fund Obligation to such
Total Sinking Fund Obligation; the Corporation shall be entitled,
at its election, to credit against its 9.76% Sinking Fund
Obligation on any 9.76% Sinking Fund Redemption Date any shares
of the Preferred Stock, Cumulative, $100 Par Value, theretofore
redeemed (other than shares of the 9.76% Preferred Stock,
Cumulative, $100 Par Value, redeemed pursuant to the 9.76%
Sinking Fund Obligation) purchased or otherwise acquired and not
previously credited against the 9.76% Sinking Fund Obligation.
FURTHER RESOLVED That the officers of the Company are hereby
authorized and directed to execute, file, publish and record all
such statements and other documents, and to do and perform all
such other and further acts and things, as in the judgment of the
officer or officers taking such action may be necessary or
desirable for the purpose of causing the immediately preceding
resolution to become fully effective and of causing said
resolution to become and constitute an amendment of the Restated
Articles of Incorporation of the Company, all in the manner and
to the extent required by the Mississippi Business Corporation
Law.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (Supp. 1987)
March 8, 1988
The undersigned corporation, pursuant to Section 79-4-6.31
of the Mississippi Code of 1972, as amended, submits the
following document and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 5,000 shares of 12%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 6,275,000 of such shares being issued and
outstanding at the date hereof; and
(b)1,699,476 shares of preferred stock, 1,323,808
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 95,000 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 8th day of March, 1988.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
By /s/ J. R. Martin
J. R. Martin
Treasurer and Assistant
Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (Supp. 1988)
January 19, 1989
The undersigned corporation, pursuant to Section 79-4-6.31
of the Mississippi Code of 1972, as amended, submits the
following document and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 1,500 shares of 12%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,699,476 shares of preferred stock, 1,323,808
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 93,500 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 19th day of January, 1989.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
REGISTERED AGENT/OFFICE STATEMENT OF CHANGE
(Mark appropriate box)
X DOMESTIC X PROFIT
FOREIGN NONPROFIT
1. Name of Corporation:
Mississippi Power & Light Company
Federal Tax ID: 64-0205830
2. Current street address of registered office:
308 East Pearl Street
Jackson, Mississippi 39201
3. New street address of registered office: (No change)
4. Name of current registered agent:
Donald C. Lutken or Robert C. Grenfell
5. Name of new registered agent:
Michael B. Bemis or Robert C. Grenfell
6. (Mark appropriate box)
(X) The undersigned hereby accepts designation as
registered agent for service of process.
/s/ Michael B. Bemis
/s/ Robert C. Grenfell
( ) Statement of written consent if attached.
7. ( ) Nonprofit. The street address of the registered
office and the street address of the
principal office of its registered
agent will be identical.
(X) Profit. The street address of the registered
office and the street address of the
business office of its registered agent
will be identical.
8. The corporation has been notified of the change of
registered office.
Mississippi Power & Light Company
Corporate Name
By: Michael B. Bemis, President and COO /s/ Michael B. Bemis
PRINTED NAME/CORPORATE TITLE SIGNATURE
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (Supp. 1988)
March 30, 1989
The undersigned corporation, pursuant to Section 79-4-6.31
of the Mississippi Code of 1972, as amended, submits the
following document and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 8,500 shares of 12%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,699,476 shares of preferred stock, 1,323,808
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 85,000 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 30th day of March, 1989.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (Supp. 1988)
March 30, 1989
The undersigned corporation, pursuant to Section 79-4-6.31
of the Mississippi Code of 1972, as amended, submits the
following document and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 5,800 shares of 12%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,692,176 shares of preferred stock, 1,316,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 87,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 150,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 30th day of March, 1989.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
ARTICLES OF CORRECTION
(Mark appropriate box)
X PROFIT NONPROFIT
The undersigned corporation, pursuant to Section 79-4-1.24 (if a
profit corporation) or Section 79-11-113 (if a nonprofit
corporation) of the Mississippi Code of 1972, as amended, hereby
executes the following document and sets forth:
1. The name of the corporation is:
Mississippi Power & Light Company
2. (Mark appropriate box.)
(X) The document to be corrected is Articles of
Amendment which became effective on March 31,
1989 (date).
( ) A copy of the document to be corrected is attached.
3. The aforesaid articles contain the following incorrect
statement:
See Attachment "A"
4. a. The reason such statement is incorrect is: The
reduction in the number of shares of the class and
series referred to in attachment A was incorrectly
states as 8,500, and should have been 5,800, which
incorrect statement is a component of certain other
statements made in the Articles of Amendment, all as
reflected in attachment "A".
or
b. The manner in which the execution of such document
was defective was:
5. The correction is as follows: Attachment "B", a new
executed form of Articles of Amendment, is substituted
in its entirety for the Articles of Amendment referred
to above.
6. The certificate of correction shall become effective on
March 31, 1989.
By: Mississippi Power & Light Company /s/ G. A. Goff
printed name/corporation title G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
ATTACHMENT "A"
The following incorrect statements were included in the
Articles of Amendment under Miss. Code Ann. Section 74-4-6.31
(Supp. 1988) dated March 30, 1989:
1. Paragraph 2 thereof provided as follows: "The
reduction in the number of authorized shares, itemized
by class and series, is 8,500 shares of 12% Preferred
Stock, Cumulative, $100 par value."
2. Paragraph 3(b) provided in part as follows: "1,699,476
shares of preferred stock, 1,323,808 shares of which
are issued and outstanding in the following series:
(vi) 85,000 shares of 12% preferred stock,
cumulative, $100 par value;
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (Supp. 1988)
November 2, 1989
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (Supp. 1988), submits the following document
and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 90,000 shares of 16.16%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,602,176 shares of preferred stock, 1,226,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $200 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 87,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 60,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 2nd day of November, 1989.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1972)
March 28, 1990
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1972), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 10,000 shares of
12.009% Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,592,176 shares of preferred stock, 1,216,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $200 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 77,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 60,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 30th day of March, 1990.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1972)
November 2, 1990
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1972), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 15,000 shares of 16.16%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,577,176 shares of preferred stock, 1,201,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 77,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 45,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 2nd day of November, 1990.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
[Letterhead of Wise Carter Child & Caraway]
March 26, 1991
Ms. Sylvia Jacobs
Branch Supervisor-Corporations Business Services
Secretary of State of State of Mississippi
202 North Congress Street, Suite 601
Jackson, MS 39205
Re: Mississippi Power & Light Company
Articles of Amendment
Dear Ms. Jacobs:
I received your Notice of Return regarding the Articles of
Amendment we recently filed for Mississippi Power & Light Company
under Section 79-4-6.31 of the Mississippi Code. Your Notice of
Return states that we must use Form C-3 provided in the Guide for
Domestic Corporations published by the Mississippi Secretary of
State.
I draw your attention to the fact that the Articles of
Amendment we are filing are being filed under Section 79-4-6.31
(1989) of the Mississippi Code, and not Section 79-4-10.06. I
agree that if we were filing Articles of Amendment under Section
79-4-10.06, the proper form to use would be Form C-3 provided by
the Mississippi Secretary of State. However, the Articles of
Amendment we are filing are being filed only because stock was
redeemed by the corporation and is now being cancelled.
We have used the form enclosed with this letter numerous
times in the past to file Articles of Amendment pursuant to
Section 79-4-6.31, after consultation with Ray Bailey. It is my
opinion that the form for the standard Articles of Amendment
would not be appropriate for the type of amendment we are filing,
and there is no place on the form to provide the information
required under Section 79-4-6.31. Accordingly, I am returning
our duplicate originals of the Articles of Amendment and request
that you file one among the records in your office, and return
the conformed copy, marked "Filed," to my attention at the above
address.
If you have any questions, please feel free to call at the
above direct dial number.
Very truly yours,
/s/ J. Michael Cockrell
J. Michael Cockrell
DMC/st
Enclosure
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
March 18, 1991
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is (a) 80 shares of 4.36%
preferred stock, cumulative, $100 par value; (b) 588
shares of 4.56% preferred stock, cumulative, $100 par
value; and (c) 10,000 shares of 12% preferred stock,
cumulative, $100 par value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,566,508 shares of preferred stock, 1,191,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 67,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 45,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)350,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 18th day of March, 1991.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ G. A. Goff
G. A. Goff
Senior Vice President,
Chief Financial Officer
and Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
July 12, 1991
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,496,508 shares of preferred stock, 1,121,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 67,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 45,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)280,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 12th day of July, 1991.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
A. H. Mapp
Assistant Treasurer and
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
November 19, 1991
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 15,000 shares of 16.16%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,481,508 shares of preferred stock, 1,106,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 67,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 30,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)280,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 19th day of November, 1991.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
A. H. Mapp
Assistant Treasurer and
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
March 13, 1992
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 10,000 shares of 12%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 7,579,400 of such shares being issued and
outstanding at the date hereof; and
(b)1,471,508 shares of preferred stock, 1,096,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 57,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 30,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)280,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 13th day of March, 1992.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
July 15, 1992
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,401,508 shares of preferred stock, 1,026,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 57,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 30,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
Dated this the 15th day of July, 1992.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment - Statement of Resolution
Establishing Series of Shares
October 22, 1992
Pursuant to the provisions of Section 79-4-6.02(d) of the
Mississippi Code of 1972 (Supp. 1989), Mississippi Power & Light
Company submits the following statement for the purpose of
establishing and designating a series of shares and fixing and
determining the relative rights and preferences thereof:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The attached resolution establishing and designating a
series of shares and fixing and determining the relative
rights and preferences thereof was duly adopted by the
Board of Directors of the Corporation on October 22,
1992.
Dated this the 22nd day of October, 1992.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Allan H. Mapp
Assistant Secretary and
Assistant Treasurer
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Excerpts from the minutes of the Meeting
of the Board of Directors held on October 22, 1992
RESOLVED That there is hereby established a series of the
Preferred Stock of Mississippi Power & Light Company as follows:
A series of 200,000 shares of the Preferred Stock shall:
(a) be designated as the "8.36% Preferred Stock,
Cumulative, $100 Par Value";
(b) have a dividend rate of $8.36 per share per annum
payable quarterly on February 1, May 1, August 1, and November 1
of each year, the first dividend date to be February 1, 1993, and
such dividends to be cumulative from the date of issuance; and
(c) be subject to redemption at the price of $100 par share
plus an amount equivalent to the accumulated and unpaid dividends
thereon, if any, to the date fixed for redemption (except that no
share of the 8.36% Preferred Stock shall be redeemed on or before
October 1, 1997).
FURTHER RESOLVED That the officers of the Company are hereby
authorized and directed to execute, file and publish and record
all such statements and other documents, and to do and perform
all such other and further acts and things, as in the judgment of
the officer and officers taking such action may be necessary or
desirable for the purpose of causing the immediately preceding
resolution to become fully effective and of causing said
resolution to become and constitute an amendment of the Restated
Articles of Incorporation of the Company, all in the manner and
to the extent required by the Mississippi Business Corporation
Law.
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
November 6, 1992
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 15,000 shares of 16.16%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,386,508 shares of preferred stock, 1,211,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 57,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 15,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 350,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(x) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 6th day of November, 1993.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
January 12, 1993
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.76%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,316,508 shares of preferred stock, 1,141,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 57,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 15,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 280,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(x) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 12th day of January, 1993.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
March 10, 1993
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 10,000 shares of 12.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,306,508 shares of preferred stock, 1,131,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 47,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 15,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 280,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(x) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 10th day of March, 1993.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ A. H. Mapp
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
July 12, 1993
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,236,508 shares of preferred stock, 1,061,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 47,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 15,000 shares of 16.16% preferred stock,
cumulative, $100 par value;
(viii)140,000 shares of 9% preferred stock,
cumulative, $100 par value;
(ix) 280,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(x) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 12th day of July, 1993.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ James W. Snider
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
November 15, 1993
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 15,000 shares of 16.16%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)1,221,508 shares of preferred stock, 1,046,508
shares of which are issued and outstanding in the
following series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 47,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 140,000 shares of 9% preferred stock,
cumulative, $100 par value;
(viii)280,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 15th day of November, 1993.
MISSISSIPPI POWER & LIGHT COMPANY
By /s/ James W. Snider
Title: Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-10.06 (1989)
February 4, 1994
The undersigned corporation, pursuant to Section 79-4-10.06
of the Mississippi Code of 1972, as amended, submits the
following document and sets forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. As evidenced by the attached Stockholder's Written
Approval of Amendment authorizing 1,500,000 additional
shares of Preferred Stock of the par value of $100 per
share, the following amendment of the Restated Articles
of Incorporation, as amended (the "Charter"), was
proposed by the Board of Directors of Mississippi Power
& Light Company on October 29, 1993, was adopted by the
stockholders of the Corporation entitled to vote on the
amendment on February 4, 1994, in accordance with and in
the manner prescribed by the laws of the State of
Mississippi and the Charter of Mississippi Power & Light
Company:
The first paragraph in Article FOURTH of the Charter is
amended to read as follows:
FOURTH: The aggregate number of shares which the
Corporation shall have authority to issue is
17,721,508 shares, divided into 2,721,508 shares of
Preferred Stock of the par value of $100 per share
and 15,000,000 shares of Common Stock without par
value.
3. Pursuant to the Laws of the State of Mississippi and the
Charter of Mississippi Power & Light Company, the
holders of Preferred Stock of the par value of $100 per
share were not entitled to vote on the amendment as a
separate voting group. The holders of the outstanding
shares of common stock were the only stockholders
entitled to vote on the amendment.
4. The number of shares of common stock of the corporation
outstanding at the time of such adoption was 8,666,357;
and the number of shares entitled to vote thereon was
8,666,357.
Dated this the 4th day of February, 1994.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ Edwin Lupberger
Edwin Lupberger
Chairman of the Board and
Chief Executive Officer
By: /s/ Donald E. Meiners
Donald E. Meiners
President
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
March 17, 1994
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 10,000 shares of 12.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,641,508 shares of preferred stock, 966,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 37,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 140,000 shares of 9% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 17th day of March, 1994.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
August 1, 1994
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,571,508 shares of preferred stock, 896,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 37,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 70,000 shares of 9% preferred stock,
cumulative, $100 par value;
(viii)210,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 1st day of August, 1994.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
January 18, 1995
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.76%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,501,508 shares of preferred stock, 826,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 37,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 70,000 shares of 9% preferred stock,
cumulative, $100 par value;
(viii)140,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 18th day of January, 1995.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
March 7, 1995
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 10,000 shares of 12.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,491,508 shares of preferred stock, 816,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 27,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 70,000 shares of 9% preferred stock,
cumulative, $100 par value;
(viii)140,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 7th day of March, 1995.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
July 20, 1995
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.00%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,421,508 shares of preferred stock, 746,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 27,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 140,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 20th day of July, 1995.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Articles of Amendment Under Miss. Code Ann.
Section 79-4-6.31 (1989)
January 19, 1996
The undersigned corporation, pursuant to Miss. Code Ann.
Section 79-4-6.31 (1989), submits the following document and sets
forth:
1. The name of the corporation is Mississippi Power & Light
Company.
2. The reduction in the number of authorized shares,
itemized by class and series, is 70,000 shares of 9.76%
Preferred Stock, Cumulative, $100 Par Value.
3. The total number of authorized shares, itemized by class
and series, remaining after reduction of the shares is
as follows:
(a)15,000,000 shares of common stock, without par
value, 8,666,357 of such shares being issued and
outstanding at the date hereof; and
(b)2,351,508 shares of preferred stock, 676,508 shares
of which are issued and outstanding in the following
series:
(i) 59,920 shares of 4.36% preferred stock,
cumulative, $100 par value;
(ii) 43,888 shares of 4.56% preferred stock,
cumulative, $100 par value;
(iii) 100,000 shares of 4.92% preferred stock,
cumulative, $100 par value;
(iv) 75,000 shares of 9.16% preferred stock,
cumulative, $100 par value;
(v) 100,000 shares of 7.44% preferred stock,
cumulative, $100 par value;
(vi) 27,700 shares of 12% preferred stock,
cumulative, $100 par value;
(vii) 70,000 shares of 9.76% preferred stock,
cumulative, $100 par value; and
(ix) 200,000 shares of 8.36% preferred stock,
cumulative, $100 par value.
Dated this the 19th day of January, 1996.
MISSISSIPPI POWER & LIGHT COMPANY
By: /s/ J. W. Snider, Jr.
Assistant Secretary
Exhibit 3(ii)f
BY-LAWS
OF
MISSISSIPPI POWER & LIGHT COMPANY
AS OF DECEMBER 10, 1993
SECTION 1 - The Annual Meeting of the Stockholders of the
Corporation for the election of Directors and such other
business as shall property come before such meeting shall be
held at the office of the Corporation in the City of Jackson,
Mississippi, on the fourth Thursday in May in each year, at
ten o'clock in the morning, unless such day is a legal
holiday in the State of Mississippi, in which case such
meeting shall be held oo the first day thereafter which is
not a legal holiday, or at such other place within or without
the State of Mississippi and at such other time as the Board
of Directors may by resolution designate.
SECTION 2 - Special Meetings of the Stockholders may be held
at the principal office of the Corporation in the City of
Jackson, Mississippi, or at such other place or places as the
Board of Directors may from time to time determine.
SECTION 3 - Special Meetings of the Stockholders of the
Corporation may be held upon the order of the Chairman of the
Board, the Board of Directors, the Executive Committee, or of
Stockholders of record holding one-tenth of the outstanding
stock entitled to vote at such meetings.
SECTION 4 - Notice of every meeting of Stockholders shall be
given in the manner provided by law to each Stockholder
entitled thereto unless waived by such Stockholder.
SECTION 5 - The holders of a majority of the outstanding
stock of the Corporation entitled to vote upon any matter to
be acted upon present in person or by proxy shall constitute
a quorum for the transaction of business at any meeting of
Stockholders but less than a quorum shall have power to
adjourn.
SECTION 6 - Certificates of stock shall be signed by the
President or a Vice President and the Secretary or an
Assistant Secretary, but where any such certificate is signed
by a Transfer Agent and by a Registrar, the signature of any
such officer or officers and the seal of the Company upon
such certificates may be facsimile, engraved or printed.
SECTION 7 - The stock of the Corporation shall be
transferable or assignable only on the books of the
Corporation by the holders in person or by attorney on the
surrender of the certificates therefor duly endorsed for
transfer.
SECTION 8 - The Board of Directors of the Corporation shall
consist of fifteen members. Each director shall hold office
until the next annual Meeting of Stockholders of the
Corporation and until his successor shall have been elected
and qualified. Directors need not be residents of the State
of Mississippi.
Meetings of the Board of Directors may be held within or
without the State of Mississippi, at the time fixed by
Resolution of the Board or upon the order of the Chairman of
the Board, the President, a Vice President, or any two
Directors. The Secretary or any other Officer performing his
duties shall give at least two days' notice of all meetings
of the Board of Directors in the manner provided by law,
provided however, a director may waive such notice in the
manner provided by law.
SECTION 9 - All Officers of the Corporation shall hold their
offices until their respective successors are chosen and
qualify, but any Officer may be removed from office at any
time by the Board of Directors.
SECTION 10 - The Officers of the Corporation shall have such
duties as usually pertain to their offices, except as
modified by the Board of Directors or the Executive
Committee, and shall also have such powers and duties as may
from time to time be conferred upon them by the Board of
Directors or the Executive Committee.
The Chairman of the Board shall be the Chief Executive
Officer of the Company, unless such title shall be otherwise
conferred by the Board, and the Chief Executive Officer shall
have supervision of the general management and control of its
business and affairs, subject, however, to the orders and
directions of the Board of Directors and of the Executive
Committee.
The Chairman of the Board shall preside at all meetings of
the Stockholders, Directors, and Executive Committees.
SECTION 11 - EXECUTIVE COMMITTEE - The Board of Directors may
elect, each year after their election, an Executive Committee
to be comprised of not less than three directors, the
Chairman of which shall be the Chairman and CEO of the
Company. The Vice Chairman and Chief Operating Officer of
the Company shall also be a member and the balance of the
membership shall be comprised of non-employee (outside)
directors. The Committee, when the Board is not in session,
shall have and exercise all of the power of the Board in the
management of the business and affairs of the Company within
limits set forth in the Executive Committee Charter.
SECTION 12 - OTHER COMMITTEES - From time to time the Board
of Directors, by the affirmative vote of a majority of the
whole Board may appoint other committees for any purpose or
purposes, and such committees shall have such powers as shall
be conferred by the Resolution of appointment.
SECTION 13 - INDEMNIFICATION
13.1 Definitions - In this bv-law:
(1) "Director mean an individual who is or was a
director of the Corporation or, unless the context
requires otherwise, an individual who, while a
director of the Corporation, is or was serving at
the Corporation's request as a director, officer,
partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other
enterprise, including charitable, non-profit or
civic organizations. A director is considered to
be serving an employee benefit plan at the
Corporation's request if his duties to the
Corporation also impose duties on, or otherwise
involve services by, him to the plan or to
participants in or beneficiaries of the plan.
"Director" includes unless the context requires
otherwise, the estate of personal representative of
a director.
(2) "Employee" means an individual who is or was an
employee of the Corporation, or, unless the context
requires otherwise, an individual who, while an
employee of the Corporation, is or was serving at
the Corporation's request as a director, officer,
partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other
enterprise, including charitable, non-profit or
civic organizations. An employee is considered to
be serving an employee benefit plan at the
Corporation's request if his duties to the
Corporation also impose duties on, or otherwise
involve services by, him to the plan or to
participants in or beneficiaries of the plan.
"Employee" includes, unless the context requires
otherwise, the estate or personal representative of
an employee.
(3) "Expenses" include counsel fees.
(4) "Liability" means the obligation to pay a judgment,
settlement, penalty, fine, or reasonable expenses
incurred with respect to a proceeding. Without any
limitation whatsoever upon the generality thereof,
the term "fine" as used in this Section shall
include (1) any penalty imposed by the Nuclear
Regulatory Commission (the "NRC"), including
penalties pursuant to NRC regulations, 10 CFR Part
21, (2) penalties or assessments (including any
excise tax assessment) with respect to any employee
benefit plan pursuant to the Employee Retirement
Income Security Act of 1974, as amended, or
otherwise, and (3) penalties pursuant to any
Federal, state or local environmental laws or
regulations.
(5) "Officer" means an individual who is or was an
officer of the Corporation, or, unless the context
requires otherwise, an individual who, while an
officer of the Corporation, is or was serving at
the Corporation's request as a director, officer,
partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other
enterprise, including charitable, non-profit or
civic organizations. An officer is considered to
be serving an employee benefit plan at the
Corporation's request if his duties to the
Corporation also impose duties on, or otherwise
involve services by, him to the plan or to
participants in or beneficiaries of the plan.
"Officer" includes, unless the context requires
otherwise, the estate or personal representative of
an officer.
(6) "Official capacity" means: (i) when usedwith
respect to a director, the office of director in
the Corporation; and (ii) when used with respect to
an individual other than a director as contemplated
in Section 13.7, the office in the Corporation held
by the officer or the employment undertaken by the
employee on behalf of the Corporation. "Official
capacity" does not include service for any other
foreign or domestic corporation or any partnership,
joint venture, trust, employee benefit plan or
other enterprise, including charitable, non-profit
or civic organizations.
(7) "Party" includes an individual who was, is, or is
threatened to be made a named defendant or
respondent in a proceeding.
(8) "Proceeding" means any threatened, pending, or
completed action suit or proceeding, whether civil,
criminal, administrative or investigative and
whether formal or informal.
13.2 Authority to Indemnify
(a) Except as provided in subsection (d), the Corporation
shall indemnify an individual made a party to a
proceeding because he is or was a director aqainst
liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed:
(i) In the case of conduct in his official capacity
with the Corporation, that his conduct was in
its best interests; and
(ii) In all other cases, that his conduct was at
least not opposed to its best interests, and
(3)In the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was unlawful
(b) A director's conduct with respect to an employee benefit
plan for a purpose he reasonably believed to be in the
interest of the participants in and beneficiaries of the
plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere
or its equivalent is not, of itself, determinative that
the director did not meet the standard of conduct
described in this section.
(d) The corporation shall not indemnify a director under
this section:
(1)In connection with a proceeding by or in the right
of the Corporation in which the director was
adjudged liable to the Corporation; or
(2) In connection with any other proceeding charging
improper personal benefit to him, whether or not
involving action in his official capacity, in which
he was adjudged liable on the basis that personal
benefit was improperly received by him.
(e) Indemnification permitted under this section in
connection with a proceeding by or in the right of the
Corporation is limited to reasonable expenses incurred
in connection with the proceeding.
(f) The Corporation shall have power to make any further
indemnity, including advance of expenses, to and to
enter contracts of indemnity with any director that may
be authorized by the articles of incorporation or any
bylaw made by the shareholders or any resolution
adopted, before or after the event, by the shareholders,
except an indemnity against his gross negligence or
willful misconduct. Unless the articles of
incorporation, or any such bylaw or resolution provide
otherwise, any determination as to any further indemnity
shall be made in accordance with subsection (b) of
Section 13.6. Each such indemnity may continue as to a
person who has ceased to have the capacity referred to
above and may inure to the benefit of the heirs,
executors and administrators of such person.
13.3 Mandatorv Indemnification
The Corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any
proceeding to which he was a party because he is or was a
director of the Corporation against reasonable expenses
incurred by him in connection with the proceeding.
13.4 Advance for Expenses
(a) The Corporation shall pay for or reimburse thereasonable
expenses incurred by a director who is a party to a
proceeding in advance of final disposition of the
proceeding if:
(1)The director furnishes the Corporation a written
affirmation of his good faith belief that he has met
the standard of conduct described in Section 13.2;
(2)The director furnishes the Corporation a written
undertaking, executed personally or on his behalf,
to repay the advance if it is ultimately determined
that he did not meet the standard of conduct; and
(3)A determination is made that the facts then known to
those making the determination would not preclude
indemnification under these By-Laws.
(b) The undertaking required by subsection (a)(2) must be an
unlimited general obligation of the director but need
not be secured and may be accepted without reference to
financial ability to make repayment.
(c) Determinations and authorizations of payments under this
section shall be made in the manner specified in Section
13.6.
13.5 Court-Ordered Indemnification
A director of the Corporation who is a party to a proceeding
may apply for indemnification to the court conducting the
proceeding or to another court of competent jurisdiction as
provided by law
13.6 Determination and Authorization of Indemnification
(a) The Corporation may not indemnify a director under
Section 13.2 unless authorized in the specific case
after a determination has been made that indemnification
of the director is permissible in the circumstances
because he has met the standard of conduct set forth in
Section 13.2
(b) The determination shalI be made:
(1)By the Board of Directors by majority vote of a
quorum consisting of directors not at the time
parties to the proceeding;
(2)If a quorum cannot be obtained under subsection (b)
(1), by majority vote of a committee duly designated
by the Board of Directors (in which designation
directors who are parties may participate),
consisting solely of two (2) or more directors not
at the time parties to the proceeding;
(3)By special legal counsel:
(i) Selected by the Board of Directors or ts
committee in the manner prescribed in
subsection (b) (1) or (b) (2); or
(ii) If a quorum of the Board of Directors cannot be
obtained under subsection (b) (1) and a
committee cannot be designated under subsection
(b) (2), selected by a majority vote of the
full Board of Directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time
parties to the proceeding may not be voted on the
determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same
manner as the determination that indemnification is
permissible, except that if the determination is made by
special legal counsel, authorization of indemnification and
evaluation as to reasonableness of expenses shall be
made by those entitled under subsection (b) (3) to
select counsel.
13.7 Indemnification of Officers, Employees and Agents
(1) An officer of the Corporation who is not a director is
entitled to mandatory indemnification under Section
13.3, and is entitled to apply for court-ordered
indemnification under Section 13.5, in each case to the
same extent as a director; and
(2) The Corporation shall indemnify and advance expenses
under these By-Laws to an officer or employee of the
Corporation who is not a director to the same extent as
to a director as provided under Sections 13.2, 13.4 and
13.6.
13.8 Insurance
If authorized by the Board of Directors, the Board of
Directors of Middle South Utilities. Inc. and/or otherwise
property authorized, the Corporation shall purchase and
maintain insurance on behalf of an individual who is or was a
director, office, or employee of the Corporation against
liability asserted against or incurred by him in that
capacity or arising from his status as a director, officer or
employee, whether or not the Corporation would have power to
indemnify him against the same liability under Sections 13.2
or 13.3. If further authorized as provided in this
subsection, the Corporation shall purchase and maintain such
insurance on behalf of an individual who is or was a
director, officer or employee who, while a director, officer
or employee of the Corporation, is or was serving at the
request of the Corporation as a director, officer, partner,
trustee, employee or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise, including charitable,
non-profit or civic organizations, whether or not the
Corporation would have power to indemnify him against the
same liability under Sections 13.2 or 13.3.
13.9 Application of By-Law
(a) This By-Law does not limit the Corporations power to pay
or reimburse expenses incurred by a director, officer or
employee in connection with his appearance as a witness
in a proceeding at a time when he has not been made a
named defendant or respondent to the proceeding.
(b) The foregoing rights shall not be exclusive of other
rights to which any director, officer or employee may
otherwise be entitled.
(c) The foregoing shall not limit any right or power of the
Corporation to provide indemnification as allowed by
statute or otherwise.
13.10 Rights Deemed Contract Rights
All rights to indemnification and to advancement of expenses
under these By-Laws shall be deemed to be provided by a
contract between the Corporation and the director, officer or
employee who serves in such capacity at any time while these
By-Laws are in effect. Any repeal or modification of this
By-Law shall not affect any rights or obligations then
existing.
SECTION 14 - The Board of Directors may alter or amend these
by-laws at any meeting duly held as herein provided.
<PAGE>
Mississippi Power & Light Company
Action of Stockholders
Pursuant to Section 79-4-7.04 and Section79-4-10.20 of the
Mississippi Code of 1972, the undersigned Entergy Corporation,
being the owner of all issued and outstanding shares of the
common stock of Mississippi Power & Light Company, hereby adopts
the following resolutions as the action of stockholders:
RESOLVED, That the first sentence of Section 8 of the
bylaws of Mississippi Power & Light Company is amended
to read as follows:
"SECTION 8 - Notwithstanding any other provision
in these bylaws of the Corporation to the
contrary, the stockholders or the Board of
Directors shall have the power from time to time
to fix the number of directors of the Company,
provided that the number so fixed shall not be
less than three (3) or more than fifteen (15)."
RESOLVED, That the first sentence of Section 11 of the
bylaws of Mississippi Power & Light Company is amended
to read as follows:
"SECTION 11 - EXECUTIVE COMMITTEE - The Board of
Directors may elect an Executive Committee to consist
of at least two members of the Board of
Directors."
RESOLVED, That the number of members of the Board of
Directors of the Corporation is fixed at six (6) and
the following persons are elected as Directors of
Mississippi Power & Light Company to hold office for
the ensuing year and until their successors shall have
been elected and qualified:
Michael B. Bemis
Donald C. Hintz
Jerry D. Jackson
Edwin A. Lupberger
Jerry L. Maulden
Donald E. Meiners
All requirements of notice of this meeting are hereby waived and,
where permissible, the actions taken herein shall be effective as
of May 5, 1994.
Date: May 25, 1994
ENTERGY CORPORATION
/s/ Edwin A. Lupberger
Edwin A. Lupberger
Chairman of the Board and Chief
Executive Officer
<PAGE>
MISSISSIPPI POWER & LIGHT COMPANY
Action of Stockholders
Pursuant to 79-4-7.04 and 79-4-10.20 of the Mississippi Code
Ann. (Supp. 1989), the undersigned Entergy Corporation, being the
owner of all issued and outstanding shares of the common stock of
Mississippi Power & Light Company, hereby adopts the following
resolution as the action of stockholders:
RESOLVED, That the second sentence of Section 11 of
the bylaws of Mississippi Power & Light Company is
amended to read as follows:
"The Vice Chairman and Chief Operating
Officer of the Company shall also be a member
of the Executive Committee."
and further
RESOLVED, that Edwin Lupberger, Jerry L. Maulden and
Jerry D. Jackson shall continue as the members of the
Executive Committee of Mississippi Power & Light
Company until the next Annual Meeting (or Unanimous
Written Consent in Lieu Thereof) of Shareholders of
Mississippi Power & Light Company.
All requirements of notice of this meeting are hereby waived and
the actions taken herein shall be effective as of the date of
execution hereof.
Date: April 5, 1995
ENTERGY CORPORATION
/s/ Edwin A. Lupberger
Edwin A. Lupberger
Chairman of the Board and Chief
Executive Officer
Exhibit 10(c)96
_________________________________________________________________
POPE COUNTY, ARKANSAS
and
ARKANSAS POWER & LIGHT COMPANY
______________
LOAN AGREEMENT
______________
Dated as of November 15, 1995
_________________________________________________________________
$120,000,000 Pope County, Arkansas Pollution Control Revenue
Refunding Bonds (Arkansas Power & Light Company Project) Series
1995
<PAGE>
LOAN AGREEMENT
This LOAN AGREEMENT, dated as of November 15, 1995, by
and between POPE COUNTY, ARKANSAS, a political subdivision under
the Constitution and laws of the State of Arkansas (hereinafter
referred to as the "County"), and ARKANSAS POWER & LIGHT COMPANY,
a corporation organized and existing under and by virtue of the
laws of the State of Arkansas (hereinafter referred to as the
"Company").
W I T N E S S E T H:
WHEREAS, the County is authorized and empowered under
the laws of the State of Arkansas, including particularly Title
14, Chapter 267 of the Arkansas Code of 1987 Annotated (the
"Act"), to issue revenue bonds and to expend the proceeds thereof
to finance and refinance the acquisition, construction,
reconstruction, extension, equipment or improvement of pollution
control facilities for the disposal or control of sewage, solid
waste, water pollution, air pollution, or any combination
thereof; and
WHEREAS, certain pollution control facilities
(hereinafter referred to as the "Facilities") have been acquired,
constructed and equipped at the Company's electric generating
plant located within the boundaries of the County near
Russellville, Arkansas and known as Arkansas Nuclear One
(hereinafter referred to as the "Plant"); and
WHEREAS, pursuant to and in accordance with the
provisions of the Act, the County has heretofore issued and
delivered its Pollution Control Revenue Bonds, Series 1985
(Arkansas Power & Light Company Project), in the aggregate
principal amount of $120,000,000 (the "Prior Bonds"), for the
purpose of financing a portion of the cost of acquiring,
constructing and equipping the Facilities and paying the expenses
of authorizing and issuing the Prior Bonds; and
WHEREAS, the County proposes to issue $120,000,000
aggregate principal amount of its revenue bonds under the Act
(the "Series 1995 Bonds") for the purpose of refunding the Prior
Bonds; and
WHEREAS, in connection with the issuance of the Series
1995 Bonds the proceeds of the Series 1995 Bonds will be loaned
by the County to the Company upon the terms and conditions set
forth herein; and
NOW, THEREFORE, for and in consideration of the
premises and the mutual covenants herein made, and subject to the
conditions herein set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. In addition to the words
and terms elsewhere defined in this Agreement or in the
Indenture, the following words and terms as used in this
Agreement shall have the following meanings unless the context or
use indicates another or different meaning:
"Act" -- Title 14, Chapter 267 of the Arkansas Code of
1987 Annotated, as amended and enacted from time to time.
"Additional Bonds" -- Bonds in addition to the Series
1995 Bonds, which are issued under the provisions of Section 211
of the Indenture.
"Administration Expenses" -- The reasonable and
necessary expenses incurred by the County with respect to this
Agreement, the Indenture and any transaction or event
contemplated by this Agreement or the Indenture including the
compensation and reimbursement of expenses and advances payable
to the Trustee, any paying agent, any co-paying agent, and the
registrar under the Indenture.
"Agreement" -- This Loan Agreement and any amendments
and supplements hereto.
"Authorized Company Representative" -- The person or
persons at the time designated to act on behalf of the Company,
such designation in each case to be evidenced by a certificate
furnished to the County and the Trustee containing the specimen
signature of such person or persons and signed on behalf of the
Company by its President, any Senior Vice President, any Vice
President, or the Treasurer.
"Bonds" -- The Series 1995 Bonds and all Additional
Bonds issued by the County pursuant to the Indenture.
"Bond Counsel" -- Any firm of nationally recognized
municipal bond counsel selected by the Company and acceptable to
the County and the Trustee.
"Bond Fund" -- The fund by that name created and
established in Section 501 of the Indenture.
"Clearing Fund" -- The fund by that name created and
established in Section 601 of the Indenture.
"Code" -- The Internal Revenue Code of 1954, as
heretofore amended (the "1954 Code"), and the Internal Revenue
Code of 1986, as heretofore or hereafter amended (the "1986
Code"), as applicable.
"Company" -- Arkansas Power & Light Company, a
corporation organized and operating under the laws of the State
of Arkansas, and its permitted successors and assigns.
"Company Mortgage" -- The Mortgage and Deed of Trust,
dated as of October 1, 1944, between the Company and Guaranty
Trust Company of New York (Bankers Trust Company, successor) and
Henry A. Theis (Stanley Burg, successor), and, as to property,
real or personal, situated or being in Missouri, Marvin A.
Mueller (The Boatmen's National Bank of St. Louis, successor), as
trustees, as heretofore and hereafter amended and supplemented.
"County" -- Pope County, Arkansas, a political
subdivision under the Constitution and laws of the State of
Arkansas.
"Event of Default" -- Any event of default specified in
Section 8.01 hereof.
"Facilities" -- The pollution control facilities at the
Plant which were financed and refinanced, in whole or in part,
with the proceeds of the Prior Bonds, which facilities are
generally described in Exhibit A hereto.
"Indenture" -- The Trust Indenture dated as of November
15, 1995, between the County and the Trustee, securing the Bonds,
and any amendments and supplements thereto.
"outstanding" -- When used with reference to the Bonds,
as of any particular date, all Bonds authenticated and delivered
under the Indenture except:
(a) Bonds canceled at or prior to such date or
delivered to or acquired by the Trustee prior to such date for
cancellation;
(b) Bonds deemed to be paid in accordance with Article
IX of the Indenture; and
(c) Bonds in lieu of or in exchange or substitution
for which other Bonds shall have been authenticated and delivered
pursuant to the Indenture.
"Plant" -- The Company's electric generating plant
located within the boundaries of the County near Russellville,
Arkansas and known as Arkansas Nuclear One.
"Prior Bonds" -- The County's Pollution Control Revenue
Bonds, Series 1985, in the aggregate principal amount of
$120,000,000.
"Series 1995 Bonds" -- The initial issue of Bonds under
and secured by the Indenture in the aggregate principal amount of
$120,000,000.
"Subordinate Lien Obligations" -- Debt obligations of
the Company secured by a lien on a substantial portion of the
property of the Company which is subordinate to the lien of the
Company Mortgage.
"Trustee" -- The banking corporation or association
designated as Trustee in the Indenture, and its successor or
successors as such Trustee. The original Trustee is Simmons
First National Bank, Pine Bluff, Arkansas.
Section 1.02. Use of Words and Phrases. "Herein",
"hereby", "hereunder", "hereof", "hereinabove", "hereinafter",
and other equivalent words and phrases refer to this Agreement
and not solely to the particular portion thereof in which any
such word is used. The definitions set forth in Section 1.01
hereof include both singular and plural. Whenever used herein,
any pronoun shall be deemed to include both singular and plural
and to cover all genders.
ARTICLE II
REPRESENTATIONS
Section 2.01. Representations and Warranties of the
County. The County makes the following representations and
warranties as the basis for the undertakings on the part of the
Company herein contained:
(a) The County is a political subdivision duly
existing under the Constitution and laws of the State of
Arkansas.
(b) The County has the power to enter into the trans
actions contemplated by this Agreement and to carry out its
obligations hereunder. By proper action of the governing body of
the County, the County has been duly authorized to execute and
deliver this Agreement.
(c) The County has not, and will not, except as
otherwise required by mandatory provisions of law, assign its
interest in this Agreement other than to secure the Bonds.
(d) The Facilities and their operation promote the
securing and developing of industry and the health, safety and
physical and economic welfare of the County and its inhabitants,
and thereby further the public purposes of the Act.
Section 2.02. Representations and Warranties of the
Company. The Company makes the following representations and
warranties as the basis for the undertakings on the part of the
County herein contained:
(a) The Company is a corporation duly incorporated and
in good standing under the laws of the State of Arkansas, is not
in violation of any provision of its Amended and Restated
Articles of Incorporation, or its Bylaws, each as amended, has
power to enter into this Agreement and to perform and observe the
agreements and covenants on its part contained herein, and has
duly authorized the execution and delivery of this Agreement by
proper corporate action.
(b) The Facilities constitute a pollution control
project of the type authorized and permitted by the Act.
(c) Neither the execution and delivery of this
Agreement, the consummation of the transactions contemplated
hereby, nor the fulfillment of or compliance with the terms and
conditions of this Agreement, conflicts with or results in a
breach of the terms, conditions or provisions of any restriction
or any agreement or instrument to which the Company is now a
party or by which the Company is bound, or constitutes a default
under any of the foregoing, or results in the creation or
imposition of any lien, charge or encumbrance whatsoever upon any
of the property or assets of the Company except any interests
created herein.
(d) The Securities and Exchange Commission, the
Arkansas Public Service Commission, and the Tennessee Public
Service Commission have each approved all matters relating to the
Company's participation in the transactions contemplated by this
Agreement which require said approval, and no other consent,
approval, authorization or other order of any regulatory body or
administrative agency or other governmental body is legally
required for the Company's participation therein, except such as
may have been obtained or may be required under the securities
laws of any state or in connection with the issuance of series of
Additional Bonds.
ARTICLE III
THE FACILITIES
Section 3.01. Construction of the Facilities. The
Company has caused the Facilities to be constructed in order to
effectuate the purposes of the Act.
Section 3.02. Maintenance of Facilities; Remodeling.
The Company shall, at its expense, cause the Facilities, and
every element and unit thereof, to be maintained, preserved and
kept in good repair, working order and condition, and from time
to time to cause all needful and proper repairs, replacements,
additions, betterments and improvements to be made thereto;
provided, however, that the Company may discontinue the operation
of, or reduce the capacity of, the Facilities, or any element or
unit thereof, if, in the judgment of the Company, any such action
is necessary or desirable in the conduct of the business of the
Company, or if the Company is ordered so to do by any regulatory
authority having jurisdiction in the premises, or if the Company
intends to sell or dispose of the same and within a reasonable
time shall endeavor to effectuate such sale. The Company shall
notify the County as to the nature and extent of any material
damage or loss to the Facilities and of the discontinuance of the
operation of the Facilities, or any material element or unit
thereof.
The Company may at its own expense cause the Facilities
to be remodeled or cause substitutions, modifications and
improvements to be made to the Facilities from time to time as
it, in its discretion, may deem to be desirable for its uses and
purposes, which remodeling, substitutions, modifications and
improvements shall be included under the terms of this Agreement
as part of the Facilities.
Section 3.03. Insurance. The Company shall, at its
expense, cause the Facilities to be kept insured against fire to
the extent that property of similar character is usually so
insured by companies similarly situated and operating like
properties, to a reasonable amount, by reputable insurance
companies or, in lieu of or supplementing such insurance in whole
or in part, adopt some other method or plan of protection against
loss by fire at least equal in protection to the method or plan
of protection against such loss of companies similarly situated
and operating like properties. All proceeds of such insurance,
or such other method or plan, shall be for the account of the
Company.
ARTICLE IV
ISSUANCE OF BONDS; DISPOSITION OF PROCEEDS OF BONDS
Section 4.01. Issuance of the Series 1995 Bonds. The
County shall issue the Series 1995 Bonds under and in accordance
with the Indenture, subject to the provisions of any bond
purchase agreement between the County and the original purchaser
or purchasers of the Series 1995 Bonds. The Company hereby
approves the issuance of the Series 1995 Bonds and all terms and
conditions thereof.
Section 4.02. Additional Bonds. So long as the
Company shall not be in default hereunder, and at the request of
the Company, the County may authorize and issue Additional Bonds
in aggregate principal amounts specified from time to time by the
Company in order to provide funds for the purpose of refunding
the Series 1995 Bonds or any series of Additional Bonds, in whole
or in part, or any combination thereof.
The right to issue Additional Bonds set forth in this
Agreement and the Indenture shall not imply that the County and
the Company may not enter into, and the County and the Company
expressly reserve the right to enter into, to the extent
permitted by law, another agreement or agreements with respect to
the issuance by the County, under an indenture or indentures
other than the Indenture, of refunding bonds to refund all or any
principal amount of any series of Bonds, and the provisions of
this Agreement and the Indenture governing the issuance of
Additional Bonds shall not apply thereto.
Section 4.03. Disposition of Bond Proceeds. The
proceeds of the issuance and sale of the Series 1995 Bonds and
any Additional Bonds, other than accrued interest, if any, paid
by the initial purchaser or purchasers thereof, shall be
deposited into the Clearing Fund, and any such accrued interest
shall be deposited into the Bond Fund, all in accordance with the
provisions of the Indenture.
ARTICLE V
LOAN PROVISIONS; OTHER OBLIGATIONS
Section 5.01. Loan of Bond Proceeds. Concurrently
with the sale and delivery of each series of the Bonds, the
County covenants and agrees that it will, upon the terms and
conditions in this Agreement, lend to the Company an amount equal
to the proceeds (other than accrued interest) of such series.
Pursuant to said covenant and agreement, the County will issue
the Bonds upon the terms and conditions contained in this
Agreement and the Indenture and will cause the Bond proceeds to
be applied as provided in Article IV hereof. The Bonds may be
sold by the County, with the consent of the Company, at a
discount from their principal amount. If the County does sell
Bonds at a discount, the amount of such discount shall be deemed
to have been loaned to the Company pursuant to the terms and
conditions hereof.
Section 5.02. Repayment of Loan. On or before any
date that principal of or interest on the Bonds is due as set
forth in the Indenture, or any date fixed for the redemption of
any or all of the Bonds pursuant to the Indenture, the Company
covenants and agrees to pay or to cause to be paid in lawful
money of the United States of America to the Trustee for deposit
in the Bond Fund, as a repayment of the loan made to the Company
pursuant to Section 5.01 hereof, a sum equal to the amount
payable on such payment date as principal (whether at maturity,
upon redemption or otherwise) of and premium, if any, and
interest on the Bonds as provided in the Indenture. Each payment
made pursuant to this Section shall be made in immediately
available funds at the principal corporate trust office of the
Trustee during normal banking hours.
In the event that the payment of the principal of and
accrued interest on the Bonds is accelerated under Section 1002
of the Indenture, the Company covenants and agrees to pay, or
cause to be paid, to the Trustee as provided above a sum equal to
all the principal of and interest on the Bonds then outstanding.
Each payment pursuant to this Section shall at all
times be sufficient to pay the amount of principal (whether at
maturity, upon redemption or otherwise) of and premium, if any,
and interest payable on the Bonds on the date that such payment
is due; provided that the obligation of the Company to make any
payment of the principal of or premium, if any, or interest on
the Bonds, whether at maturity, upon redemption or otherwise,
shall be reduced by the amount of any reduction under the
Indenture of the amount of the corresponding payment required to
be made by the County thereunder in respect of the principal of
or premium, if any, or interest on the Bonds.
Section 5.03. Payments Assigned; Obligation Absolute.
It is understood and agreed that all payments to be made by the
Company of the loan by the County are, by the Indenture, to be
pledged by the County to the Trustee, and that all rights and
interest of the County hereunder (except for the County's rights
under Sections 5.04, 5.05, 5.06, 6.03 and 8.05 hereof and any
rights of the County to receive notices, certificates, requests,
requisitions, directions and other communications hereunder) are
to be pledged and assigned to the Trustee. The Company assents
to such pledge and assignment and agrees that the obligation of
the Company to make the payments of the loan shall be absolute,
irrevocable and unconditional and shall not be subject to
cancellation, termination or abatement, or to any defense other
than payment, or to any right of set-off, counterclaim or
recoupment arising out of any breach under this Agreement, the
Indenture or otherwise by the County or the Trustee or any other
party, or out of any obligation or liability at any time owing to
the Company by the County, the Trustee or any other party, and,
further, that the payments of the loan from the County to the
Company and the other payments due hereunder shall continue to be
payable at the times and in the amounts specified herein, whether
or not the Facilities or the Plant, or any portion thereof, shall
have been completed or shall have been destroyed by fire or other
casualty, or title thereto, or the use thereof, shall have been
taken by the exercise of the power of eminent domain, and that
there shall be no abatement of or diminution in any such payments
by reason thereof, whether or not the Facilities or the Plant
shall be used or useful, and whether or not any applicable laws,
regulations or standards shall prevent or prohibit the use of the
Facilities or the Plant, or for any other reason.
Section 5.04. Payment of Expenses. The Company shall
pay, or cause to be paid, all of the Administration Expenses of
the County, the payment of the compensation and the reimbursement
of expenses and advances of the Trustee, any paying agent, any
co-paying agent, and the registrar under the Indenture to be made
directly to such entity.
Section 5.05. Indemnification. The Company releases
the County and the Trustee from, agrees that the County and the
Trustee shall not be liable for, and agrees to indemnify and hold
the County and the Trustee free and harmless from, any liability
for any loss or damage to property or any injury to or death of
any person that may be occasioned by any cause whatsoever
pertaining to the Facilities, except in any case as a result of
the negligence or bad faith of the County or the Trustee.
The Company will indemnify and hold the County and the
Trustee free and harmless from any loss, claim, damage, tax,
penalty, liability (including but not limited to liability for
any patent infringement), disbursement, litigation expenses,
attorneys' fees and expenses or court costs arising out of, or in
any way relating to, the execution or performance of this
Agreement, the issuance or sale of the Bonds, actions taken under
the Indenture, or any other cause whatsoever pertaining to the
Facilities, including without limitation, recovery costs arising
from the presence of hazardous substances, except in any case as
a result of the negligence or bad faith of the Trustee, or as a
result of the gross negligence or bad faith of the County.
Under this Section 5.05, the Company shall also be
deemed to release, indemnify and agree to hold harmless each
employee, official or officer of the County and the Trustee to
the same extent as the County and the Trustee.
Section 5.06. Payment of Taxes; Discharge of Liens.
The Company shall: (a) pay, or make provision for payment of, all
lawful taxes and assessments, including income, profits, property
or excise taxes, if any, or other municipal or governmental
charges, levied or assessed by any federal, state or municipal
government or political body upon the County with respect to the
Facilities or any part thereof or upon any amounts payable
hereunder; and (b) pay or cause to be satisfied and discharged or
make adequate provision to satisfy and discharge, within sixty
(60) days after the same shall accrue, any lien or charge upon
any amounts payable hereunder, and all lawful claims or demands
for labor, materials, supplies or other charges which, if unpaid,
might be or become a lien upon such amounts; provided that if the
Company shall first notify the County and the Trustee of its
intention so to do, the Company may in good faith contest any
such lien or charge or claims or demands in appropriate legal
proceedings, and in such event may permit the items so contested
to remain undischarged and unsatisfied during the period of such
contest and any appeal therefrom, unless the County or the
Trustee shall notify the Company in writing that, in the opinion
of counsel to the County or the Trustee, by nonpayment of any
such items the lien of the Indenture as to the amounts payable
hereunder will be materially endangered, in which event the
Company shall promptly pay and cause to be satisfied and
discharged all such unpaid items. The County shall cooperate
fully with the Company in any such contest.
ARTICLE VI
SPECIAL COVENANTS AND AGREEMENTS
Section 6.01. Maintenance of Corporate Existence. The
Company shall maintain its corporate existence, will not dissolve
or otherwise dispose of all or substantially all its assets and
will not consolidate with or merge with or into another
corporation; provided, however, that the Company may consolidate
with or merge with or into, or sell or otherwise transfer all or
substantially all of its assets (and may thereafter dissolve) to,
another corporation, incorporated under the laws of the United
States, one of the states thereof or the District of Columbia, if
the surviving, resulting or transferee corporation, as the case
may be (if other than the Company), prior to or simultaneously
with such consolidation, merger, sale or transfer, assumes, by
delivery to the Trustee of an instrument in writing satisfactory
in form and substance to the Trustee, all the obligations of the
Company hereunder.
If consolidation, merger or sale or other transfer is
made as permitted by this Section 6.01, the provisions of this
Section 6.01 shall continue in full force and effect and no
further consolidation, merger or sale or other transfer shall be
made except in compliance with the provisions of this Section
6.01.
Section 6.02. Permits or Licenses. In the event that
it may be necessary for the proper performance of this Agreement
on the part of the Company or the County that any application or
applications for any permit or license to do or to perform
certain things be made to any governmental or other agency by the
Company or the County, the Company and the County each shall,
upon the request of either, execute such application or
applications.
Section 6.03. County's and Trustee's Access to
Facilities. The County and the Trustee shall have the right,
upon appropriate prior notice to the Company, to have reasonable
access to the Facilities during normal business hours for the
purpose of making examinations and inspections of the same.
Section 6.04. Arbitrage Covenant. The County and the
Company covenant that the proceeds of the sale of the Bonds, the
earnings thereon, and any other moneys on deposit in any fund or
account maintained in respect of the Bonds (whether such moneys
were derived from the proceeds of the sale of the Bonds or from
other sources) will not be used in a manner which would cause the
Bonds to be treated as "arbitrage bonds" within the meaning of
Section 148 of the Code. The Company further covenants that: (a)
all actions with respect to the Bonds required by Section 148(f)
of the Code shall be taken; (b) it shall make the determinations
required by paragraph (b) of Section 702 of the Indenture and
promptly notify the Trustee of the same, together with supporting
calculations; and (c) it shall within twenty-five (25) days after
(i) the calendar date which corresponds to the final maturity of
the respective series of Bonds and each anniversary thereof
falling on or after the date of initial authentication and
delivery thereof up to and including the final maturity of such
series of the Bonds, unless the final payment, whether upon
redemption in whole or at maturity, of such Bonds shall have
occurred prior to such anniversary, and (ii) such final payment,
file with the Trustee a statement signed by an Authorized Company
Representative to the effect that the Company is then in
compliance with its covenants contained in clauses (a) and (b) of
this sentence, together with supporting calculations; provided,
however, that if the Company shall furnish an opinion of Bond
Counsel to the Trustee to the effect that no further action by
the Company is required for such compliance with respect to the
Bonds, the Company shall not thereafter be required to deliver
any such statements or calculations.
Section 6.05. Use of Facilities. The Company shall
cause the Facilities to be used for the abatement or control of
pollution or for the disposal of sewage or solid waste.
Section 6.06. Tax Exempt Status of Bonds. The County
and the Company mutually covenant and agree that neither of them
shall take or authorize or permit any action to be taken, and
have not taken or authorized or permitted any action to be taken,
which results in interest paid on the Bonds being included in
gross income for purposes of federal income taxes. Without
limiting the generality of the foregoing, the Company further
covenants and agrees as follows:
(a) Not less than 90% of the proceeds (within the
meaning of Section 103(b)(4) of the 1954 Code and
regulations thereunder) from the sale of the Prior Bonds was
expended (or was used to retire bonds not less than 90% of
the proceeds from the sale of which was expended) (i) for
proper costs of land or property of a character subject to
the allowance for depreciation under Section 167 of the
Code, or which will be, for federal income tax purposes,
chargeable to capital account or would have been so
chargeable either with a proper election by the Company (for
example under Section 266 of the Code) or but for a proper
election by the Company to deduct such amounts, and (ii) to
provide sewage or solid waste disposal facilities within the
meaning of Section 103(b)(4)(E) or (F) of the Code and
regulations thereunder.
(b) Within fifteen (15) days of the date of issuance
of the Series 1995 Bonds, there neither have been nor will
be any private activity bonds (within the meaning of Section
141(a) of the 1986 Code) sold to finance facilities of the
Company or any related person within the meaning of Section
147(a)(2) of the Code, under a common plan of marketing, at
substantially the same rate of interest, and for which a
common or pooled security will be used or available to pay
debt service.
(c) The average maturity of the Series 1995 Bonds
(within the meaning of Section 147(b) of the 1986 Code and
regulations thereunder) does not exceed 120% of the average
reasonably expected economic life of the Facilities (within
the meaning of Section 147(b) of the 1986 Code and
regulations thereunder).
(d) No changes will be made in the Facilities which in
any way impair the exclusion of interest on any of the Bonds
from gross income for purposes of federal income taxation.
(e) No action shall be taken that will cause the
Series 1995 Bonds to be "federally guaranteed" as defined in
Section 149(b) of the Code.
(f) No portion of the proceeds of the Series 1995
Bonds (within the meaning of Section 147(g) of the Code and
regulations thereunder) will be used to finance costs of
issuance of the Series 1995 Bonds.
(g) (i) The Facilities being refinanced out of the
proceeds of the Series 1995 Bonds are part of the facilities
described in either the Memorandum of Agreement dated
September 23, 1974, between the County and the Company
(authorized by Order of the County Court entered as of
August 1, 1974), or the Memorandum of Agreement dated April
5, 1985 (authorized by Order of the County Court entered on
April 5, 1985, and by Ordinance No. 85-0-15 adopted by the
Quorum Court on April 4, 1985); (ii) acquisition and
construction of each of such Facilities commenced prior to
September 2, 1974, and that none of such Facilities had
reached a degree of completion which would permit operation,
nor was any of such Facilities in fact in operation, at
substantially the level for which it was designed prior to
September 23, 1974; and (iii) acquisition and construction
of each of the Facilities described in the Memorandum of
Agreement dated April 5, 1985, commenced on or after April
5, 1985, and none of such Facilities had been placed in
service or acquired (whichever occurred last) as of December
19, 1985.
The covenants and agreements contained in this Section 6.06 shall
survive any termination of this Agreement.
Section 6.07 Pledge of Collateral Obligations. (a)
In the event the Company issues any Subordinate Lien Obligations,
the Company shall issue and deliver to the Trustee evidences of
indebtedness (the "Collateral Obligations") secured in parity
with Subordinate Lien Obligations as provided in subsection (b)
of this Section 6.07.
(b) Concurrently with the issuance and delivery by the
Company of any Subordinate Lien Obligations, in order to secure
the obligation of the Company under Section 5.02 hereof to repay
installments of the loan from the County, the Company, subject to
the receipt of all necessary corporate and regulatory approvals
and in compliance with the Company's Amended and Restated
Articles of Incorporation, shall issue and deliver to the County
a series of Collateral Obligations (i) maturing on the stated
maturity date of the Series 1995 Bonds, (ii) in an aggregate
principal amount not less than the then outstanding principal of
the Series 1995 Bonds, (iii) containing redemption provisions
corresponding with any provisions of the Indenture relating to
the Series 1995 Bonds requiring mandatory redemption thereof,
(iv) requiring payment thereon to be made to the Trustee for the
account of the County, and (v) which may, but shall not be
required to, bear interest at the same rate as the Series 1995
Bonds.
(c) The Collateral Obligations shall be issued and
delivered to, registered in the name of and held by the Trustee
for the benefit of the owners and holders from time to time of
the Series 1995 Bonds.
ARTICLE VII
ASSIGNMENT, LEASING AND SELLING
Section 7.01. By the County. Except as provided in
Article V of this Agreement, the County will not sell, lease,
assign, transfer, convey or otherwise dispose of its interest in
this Agreement or any portion thereof or interest therein or in
the revenues therefrom without the written consent of the
Company.
Section 7.02. By the Company. The Company's interest
in this Agreement may be assigned in whole or in part, and the
Facilities may be leased or sold as a whole or in part (whether a
specific element or unit or an undivided interest), by the
Company, subject, however, to the condition that no assignment,
lease or sale (other than as described in Section 6.01 hereof)
shall relieve the Company from primary liability for its
obligations under Section 5.02 hereof to repay the loan from the
County to the Company, or for any other of its obligations
hereunder, other than those obligations relating to the
operation, maintenance and insurance of the Facilities which
obligations (to the extent of the interest assigned, leased or
sold and to the extent assumed by the assignee, lessee or
purchaser) shall be deemed to be satisfied and discharged.
After any lease or sale of any element or unit of the
Facilities, or any interest therein, such element or unit, or
interest therein, shall no longer be deemed to be part of the
Facilities for the purposes of this Agreement.
The Company shall, within fifteen (15) days after the
delivery thereof, furnish to the County and the Trustee a true
and complete copy of the agreements or other documents
effectuating any such assignment, lease or sale.
Section 7.03. Limitation. This Agreement shall not be
assigned nor shall the Facilities be leased or sold, in whole or
in part, except as provided in this Article VII or in Section
6.01 or in the Indenture.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
Section 8.01. Events of Default. Each of the
following events shall constitute and is referred to in this
Agreement as an "Event of Default":
(a) a failure by the Company to make when due any
payment required to be made pursuant to Section 5.02 hereof,
which failure shall have resulted in an "Event of Default"
under clause (a) or (b) of Section 1001 of the Indenture;
(b) a failure by the Company to pay when due any other
amount required to be paid under this Agreement or to
observe and perform any covenant, condition or agreement on
its part to be observed or performed under this Agreement
which failure shall continue for a period of ninety (90)
days after written notice, specifying such failure and
requesting that it be remedied, shall have been given to the
Company by the County or the Trustee, unless the County and
the Trustee shall agree in writing to an extension of such
period prior to its expiration; provided, however, that the
County and the Trustee shall be deemed to have agreed to an
extension of such period if corrective action is initiated
by the Company within such period and is being diligently
pursued;
(c) the expiration of a period of ninety (90) days
following:
(1) the adjudication of the Company as a
bankrupt by any court of competent jurisdiction;
(2) the entry of an order approving a
petition seeking reorganization or arrangement of the
Company under the federal bankruptcy laws or any other
applicable law or statute of the United States, or of
any state thereof; or
(3) the appointment of a trustee or a
receiver of all or substantially all of the property of
the Company;
unless during such period such adjudication, order or
appointment of a trustee or receiver shall be vacated or
shall be stayed on appeal or otherwise or shall have
otherwise ceased to continue in effect; or
(d) the filing by the Company of a voluntary petition
in bankruptcy or the making of an assignment for the benefit
of creditors; the consenting by the Company to the
appointment of a receiver or trustee of all or any part of
its property; the filing by the Company of a petition or
answer seeking reorganization or arrangement under the
federal bankruptcy laws, or any other applicable law or
statute of the United States, or of any state thereof; or
the filing by the Company of a petition to take advantage of
any insolvency act.
Section 8.02. Force Majeure. The provisions of
Section 8.01 hereof are subject to the following limitations: If
by reason of acts of God; strikes, lockouts or other industrial
disturbances; acts of public enemies; orders or other acts of any
kind of the Government of the United States or of the State of
Arkansas, or any other sovereign entity or body politic, or any
department, agency, political subdivision, court or official of
any of them, or any civil or military authority; insurrections;
riots; epidemics; landslides; lightning; earthquakes; volcanoes;
fires; hurricanes; tornados; storms; floods; washouts; droughts;
arrests; restraint of government and people; civil disturbances;
explosions; breakage or accident to machinery; partial or entire
failure of utilities; or any cause or event not reasonably within
the control of the Company, the Company is unable in whole or in
part to carry out any one or more of its agreements or
obligations contained herein, other than its obligations under
Section 5.02 hereof to repay the loan made to the Company and its
obligations under Sections 5.05, 6.01, 6.04, 6.06 and 9.01
hereof, the Company shall not be deemed in default by reason of
not carrying out said agreement or agreements or performing said
obligation or obligations during the continuance of such
inability. The Company agrees, however, to use its best efforts
to remedy with all reasonable dispatch the cause or causes
preventing it from carrying out its agreements; provided, that
the settlement of strikes, lockouts and other industrial
disturbances shall be entirely within the discretion of the
Company, and the Company shall not be required to make settlement
of strikes, lockouts and other industrial disturbances by
acceding to the demands of the opposing party or parties when
such course is in the judgment of the Company unfavorable to the
Company.
Section 8.03. Remedies on Default. (a) Upon the
occurrence and continuance of any Event of Default, and further
upon the condition that, in accordance with the terms of the
Indenture, the Bonds shall have become immediately due and
payable pursuant to any provision of the Indenture, the payments
required to be paid pursuant to Section 5.02 hereof shall,
without further action, become and be immediately due and
payable.
(b) Upon the occurrence and continuance of any Event
of Default, the County with the prior consent of the Trustee, or
the Trustee, may take any action at law or in equity to collect
the payments then due and thereafter to come due hereunder, or to
enforce performance and observance of any obligation, agreement
or covenant of the Company under this Agreement.
(c) Any amounts collected pursuant to action taken
under this Section shall be applied in accordance with the
Indenture.
(d) In case any proceeding taken by the County or the
Trustee on account of any Event of Default shall have been dis
continued or abandoned for any reason, or shall have been
determined adversely to the County or the Trustee, then and in
every case the County and the Trustee shall be restored to their
former positions and rights hereunder, respectively, and all
rights, remedies and powers of the County and the Trustee shall
continue as though no such proceeding had been taken.
Section 8.04. No Remedy Exclusive. No remedy
conferred upon or reserved to the County or the Trustee by this
Agreement is intended to be exclusive of any other available
remedy or remedies, but each and every such remedy shall be
cumulative and shall be in addition to every other remedy given
under this Agreement or now or hereafter existing at law or in
equity or by statute. No delay or omission to exercise any right
or power accruing upon any Event of Default shall impair any such
right or power or shall be construed to be a waiver thereof, but
any such right or power may be exercised from time to time and as
often as may be deemed expedient. In order to entitle the County
or the Trustee to exercise any remedy reserved to it in this
Article, it shall not be necessary to give any notice other than
such notice as may be required in this Article.
Section 8.05. Agreement to Pay Attorneys' Fees and
Expenses. In the event the Company should default under any of
the provisions of this Agreement and the County or the Trustee
should employ attorneys or incur other expenses for the
collection of payments due hereunder or for the enforcement of
performance or observance of any obligation or agreement on the
part of the Company contained herein, the Company agrees that it
will on demand therefor pay to the County or the Trustee, as the
case may be, the reasonable fees of such attorneys and such other
expenses so incurred.
Section 8.06. Waiver of Breach. In the event that any
agreement contained herein shall be breached by either the
Company or the County and such breach shall thereafter be waived
by the other party, such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any
other breach hereunder. In view of the assignment of the
County's rights in and under this Agreement to the Trustee under
the Indenture, the County shall have no power to waive any
default hereunder by the Company without the consent of the
Trustee. Any waiver of any "Event of Default" under the
Indenture and a rescission and annulment of its consequences
shall constitute a waiver of the corresponding Event of Default
hereunder and a rescission and annulment of the consequence
thereof.
ARTICLE IX
REDEMPTION OR PURCHASE OF BONDS
Section 9.01. Redemption of Bonds. The County shall
take the actions required by the Indenture to discharge the lien
thereof through the redemption, or provision for payment or
redemption, of all Bonds then outstanding, or to effect the
redemption, or provision for payment or redemption, of less than
all the Bonds then outstanding, upon receipt by the County and
the Trustee from the Company of a notice designating the
principal amounts, series and maturities of the Bonds to be
redeemed, or for the payment or redemption of which provision is
to be made, and, in the case of redemption of Bonds, or provision
therefor, specifying the date of redemption, which shall not be
less than forty-five (45) days from the date such notice is
given, and the applicable redemption provision of the Indenture.
Unless otherwise stated therein or otherwise required by the
Indenture, such notice shall be revocable by the Company at any
time prior to the time at which the Bonds to be redeemed, or for
the payment or redemption of which provision is to be made, are
first deemed to be paid in accordance with Article IX of the
Indenture. The Company shall furnish, as a prepayment of the
amounts due under Section 5.02 hereof, any moneys or Government
Securities (as defined in the Indenture) required by the
Indenture to be deposited with the Trustee or otherwise paid by
the County in connection with any of the foregoing purposes.
Section 9.02. Purchase of Bonds. The Company may at
any time, and from time to time, furnish moneys to the Trustee
accompanied by a notice directing the Trustee to apply such
moneys to the purchase in the open market of Bonds in the
principal amounts and of the series and maturities specified in
such notice, and any Bonds so purchased shall thereupon be
canceled by the Trustee.
ARTICLE X
RECORDATION AND OTHER INSTRUMENTS
Section 10.01. Recording and Filing. The Company
shall record and file, or cause to be recorded and filed, all
documents and statements referred to in Section 404 of the
Indenture.
Section 10.02. Photocopies and Reproductions. A
photocopy or other reproduction of this Agreement may be filed as
a financing statement pursuant to the Uniform Commercial Code,
although the signatures of the Company and the County on such
reproduction are not original manual signatures.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Notices. Except as otherwise provided
in this Agreement, all notices, certificates or other
communications shall be sufficiently given and shall be deemed
given when mailed by registered or certified mail, postage
prepaid, to the County, the Company or the Trustee. Copies of
each notice, certificate or other communication given hereunder
by or to the Company shall be mailed by registered or certified
mail, postage prepaid, to the Trustee; provided, however, that
the effectiveness of any such notice shall not be affected by the
failure to send any such copies. Notices, certificates or other
communications shall be sent to the following addresses:
Company: Arkansas Power & Light Company
P.O. Box 61000
New Orleans, Louisiana 70161
Attention: Treasurer
County: Pope County, Arkansas
Pope County Courthouse
100 West Main Street
Russellville, Arkansas 72801
Attention: County Judge
Trustee: Simmons First National Bank
P.O. Box 7009
Pine Bluff, Arkansas 71611
Attention: Corporate Trust Department
Any of the foregoing may, by notice given hereunder, designate
any further or different addresses to which subsequent notices,
certificates or other communications shall be sent.
Section 11.02. Severability. If any provision of this
Agreement shall be held or deemed to be or shall, in fact, be
illegal, inoperative or unenforceable, the same shall not affect
any other provision or provisions herein contained or render the
same invalid, inoperative, or unenforceable to any extent
whatever.
Section 11.03. Execution of Counterparts. This
Agreement may be simultaneously executed in several counterparts,
each of which shall be an original and all of which shall
constitute but one and the same instrument.
Section 11.04. Amounts Remaining in Bond Fund. It is
agreed by the parties hereto that after payment in full of (i)
the Bonds (or the provision for payment thereof having been made
in accordance with the provisions of the Indenture), (ii) the
Administration Expenses, and (iii) all other amounts required to
be paid under this Agreement and the Indenture, any amounts
remaining in the Bond Fund shall belong to and be paid by the
Trustee to the Company.
Section 11.05. Amendments, Changes and Modifications.
Except as otherwise provided in this Agreement or the Indenture,
subsequent to the initial issuance of Bonds and prior to payment
in full of the Bonds (or the provision for payment thereof having
been made in accordance with the provisions of the Indenture),
this Agreement may not be effectively amended, changed, modified,
altered or terminated nor any provision waived, without the
written consent of the Trustee which shall not be unreasonably
withheld.
Section 11.06. Governing Law. This Agreement shall be
governed exclusively by and construed in accordance with the
applicable laws of the State of Arkansas.
Section 11.07. Authorized Company Representatives. An
Authorized Company Representative shall act on behalf of the
Company whenever the approval of the Company is required or the
Company requests the County to take some action, and the County
and the Trustee shall be authorized to act on any such approval
or request and neither party hereto shall have any complaint
against the other or against the Trustee as a result of any such
action taken.
Section 11.08. Term of the Agreement. This Agreement
shall be in full force and effect from the date hereof until the
right, title and interest of the Trustee in and to the Trust
Estate (as defined in the Indenture) shall have ceased,
determined and become void in accordance with Article IX of the
Indenture and until all payments required under this Agreement
shall have been made.
Section 11.09. No Personal Liability. No covenant or
agreement contained in this Agreement shall be deemed to be the
covenant or agreement of any official, officer, agent, or
employee of the County in his individual capacity, and no such
person shall be subject to any personal liability or
accountability by reason of the issuance thereof.
Section 11.10. Parties in Interest. This Agreement
shall inure to the benefit of and shall be binding upon the
County, the Company and their respective successors and assigns,
and no other person, firm or corporation shall have any right,
remedy or claim under or by reason of this Agreement; provided,
however, that any obligation of the County created by or arising
out of this Agreement shall be payable solely out of the revenues
derived from this Agreement or the sale of the Bonds or income
earned on invested funds as provided in the Indenture and shall
not constitute, and no breach of this Agreement by the County
shall impose, a pecuniary liability upon the County or a charge
upon the County's general credit or against its taxing powers.
<PAGE>
IN WITNESS WHEREOF, the County and the Company have
caused this Agreement to be executed in their respective
corporate names and their respective corporate seals to be
hereunto affixed and attested by their duly authorized officers,
all as of the date first above written.
POPE COUNTY, ARKANSAS
ATTEST:
By _____________________________
___________________________ County Judge
County Clerk
(SEAL)
ARKANSAS POWER & LIGHT COMPANY
ATTEST:
By _____________________________
___________________________
_____________________________
___________________________ (title)
(title)
(SEAL)
<PAGE>
EXHIBIT A
DESCRIPTION OF FACILITIES
I. An Undivided Interest in Circulating Water System (Unit
2). Major components of the Circulating Water System include the
following equipment on Unit 2, which together are designed to
supply the cooling water required to remove the heat loads
developed in the main condenser and the main circulating water
pump motor coolers:
(a) Two 50% capacity, vertical mixed flow type, circulating
water pumps;
(b) One hyperbolic, natural draft cooling tower;
(c) Two 100% capacity, positive displacement type, cooling
tower acid pumps;
(d) One chlorine booster pump;
(e) One condenser tube cleaning system including
strainer with motor operated screens, recirculation and
reinjection pumps, collectors and distributors; and
(f) Piping, valves, expansion joints and
instrumentation.
The system is a closed loop system installed in excess of a
simple open loop river-to-river cooling system (used on Unit 1)
so as to avoid excessive thermal discharges to the Dardanelle
Reservoir. Excluded herein are facilities shared with the Unit 1
open loop system, such as intake and discharge canals, and
emergency cooling pond and raw water storage. The undivided
interest in the Circulating Water System included herein
(expressed as a percentage) is 56.29%.
II. Portions of the Gaseous Radwaste Systems (Units 1 and
2). Included herein are those portions of the gaseous Radwaste
Systems which function to abate or control atmospheric pollution
by removing, altering, disposing or storing radioactive
pollutants or contaminants in the gaseous effluent prior to being
released to the environment. Major components of the Unit 1
system include four gas decay tanks, compressors and heat
exchangers, and discharge filters. Major components of the Unit
2 system include three gas decay tanks, compressors, heat
exchanges and discharge filters.
III. Fuel Handling Area Exhaust Systems (Units 1 and 2).
Major components in each system include exhaust fans, prefilters,
HEPA filters, and charcoal absorbers, which function to treat or
filter radioactively charged vapors prior to their release to the
atmosphere.
IV. Sewage System. Major components include septic tanks,
distribution box, sand filter, chlorination equipment,
chlorination contact chamber and associated piping, to process
the sewage waste from the Plant.
V. Portion of the Makeup Water Systems (Units 1 and 2).
Included herein are those portions of the Makeup Water Systems
which function to collect and neutralize chemical waste from each
generating unit before any discharge to the Dardanelle Reservoir.
Major components of each system include a neutralization tank,
pumps, interconnecting piping, valves and controls.
Exhibit 10(d)31
SECOND AMENDMENT TO
DECOMMISSIONING TRUST AGREEMENT
This Second Amendment to Decommissioning Trust Agreement
("Second Amendment") made effective as of the 1st day of
November, 1995 by and between Gulf States Utilities Company
(the "Company"), and Mellon Bank, N.A. (the "Successor
Trustee").
WHEREAS, on March 15, 1989, the Company and Morgan
Guaranty Trust Company of New York (the "Trustee") entered
into a Decommissioning Trust Agreement (the "Trust
Agreement"), which provided for the establishment and
maintenance of a nuclear decommissioning reserve fund (the
"Trust Fund") to hold and invest revenues collected by the
Company for the decommissioning of Unit No. 1 of the River
Bend Steam Electric Generating Station; and
WHEREAS, as of April 8, 1992, in connection with the
promulgation of certain rules by the Public Utility
Commission of Texas applicable to the investment or
reinvestment of funds held under the Trust Agreement, the
Company and the Trustee entered into Amendment No. 1 to
Decommissioning Trust Agreement (the "First Amendment"); and
WHEREAS, the Company wishes to remove the Trustee,
continue to maintain the Trust Fund, and appoint Mellon Bank,
N.A. as Successor Trustee; and
WHEREAS, Mellon Bank, N.A. is a national banking
association with trust powers and has full power and
authority to enter into this Second Amendment; and
WHEREAS, Mellon Bank, N.A. is willing to serve as
Successor Trustee on the terms and conditions herein set
forth;
NOW, THEREFORE, the Company and Mellon Bank, N.A. agree
as follows:
1. In accordance with section 6.01 of the Trust
Agreement, as amended by the First Amendment, the Company
hereby appoints Mellon Bank, N.A. as Successor Trustee of the
Trust Fund, and Mellon Bank, N.A. hereby accepts such
appointment.
2. "Successor Trustee" shall mean Mellon Bank, N.A. and
any successor thereto.
3. "First Amendment" shall mean the Trust Agreement, as
amended by Amendment No. 1 to Decommissioning Trust Agreement
made effective on April 8, 1992.
4. The Company and the Successor Trustee agree to be
bound by the terms of the First Amendment, with the following
modifications:
a. The definitions of "Contribution," "Investment
Account," and "Order" in Article I of the First
Amendment are hereby amended by replacing
"Trustee" with "Successor Trustee."
b. All pertinent sections of the First Amendment
are hereby amended by replacing "Trustee" with
"Successor Trustee" unless the context clearly
requires otherwise.
c. Section 2.01 of the First Amendment is hereby
amended by adding the following additional
sentence at its conclusion:
"The assets of the Qualified Fund may be used
only in a manner authorized by Section 468A of
the Code and the regulations thereunder."
d. Section 2.03 of the First Amendment is hereby
amended to provide as follows:
"Acceptance of Appointment. Upon the terms and
conditions herein set forth, Mellon Bank, N.A.
accepts the appointment as Successor Trustee of
this Trust and each of the Funds.
Notwithstanding its acceptance of this
appointment, the Successor Trustee shall not be
responsible for the adequacy of the assets of
the Trust to pay amounts reflected in any
Certificate and shall make such payments only to
the extent of the assets of the Trust. The
Successor Trustee shall receive any
Contributions transferred to it by the Company
and shall hold, manage, invest and administer
such Contributions, together with earnings and
appreciation thereon. Notwithstanding the
foregoing sentence, the Successor Trustee is
under no duty to compel the Company to make any
Contribution to the Trust or to inquire into or
otherwise verify the correctness, accuracy or
amount of any such Contribution."
e. Section 2.08 of the First Amendment is hereby
amended by adding the following additional
sentence at its conclusion:
"The Agreement cannot be amended to violate
Section 468A of the Code or the regulations
thereunder."
f. The sixth sentence of Section 7.01 of the First
Amendment is hereby amended to provide as
follows:
"An Investment Manager shall certify in writing
to the Trustee that it is registered under the
Investment Advisers Act of 1940, or is a bank as
defined in that Act, shall accept its
appointment as Investment Manager, shall certify
the identity of the person or persons authorized
to give instructions or directions to the
Trustee on its behalf, including specimen
signatures, and shall undertake to perform the
duties imposed on it under an Investment Manager
Agreement."
g. Add a new Section 8.09 to provide as follows:
"Legal Proceedings. To commence or defend
suits or legal proceedings and represent the
Fund in all suits or legal proceedings in any
court or before any other body or tribunal as
the Trustee shall deem necessary to protect the
Fund.
Notwithstanding the provisions of this
Article VIII, to the extent any fiduciary powers
granted to the Trustee involve investment
discretion over assets managed by an Investment
Manager, and the Company does not otherwise
direct the Trustee in the exercise of such
power, the Trustee shall exercise such power at
the direction of the Investment Manager."
h. Paragraph (1) of Section 9.02 of the First
Amendment is hereby amended to provide as
follows:
"Unless such investment is permitted to be made
by Section 468A(e)(4)(c) of the Code, the
regulations thereunder, and any applicable
successor provisions; or"
i. Section 9.05 of the First Amendment is hereby
amended by adding the following wording to the
end of the last sentence:
"; and to hold uninvested cash in its commercial
bank or that of an affiliate, as it shall deem
reasonable or necessary; and to settle
investments in any collective investment fund,
including a collective investment fund
maintained by the Trustee or an affiliate and
appoint agents and sub-trustees; provided that
to the extent that any investment is made in any
such collective investment fund, the terms of
the collective trust indenture shall solely
govern the investment duties, responsibilities
and powers of the trustee of such collective
investment fund and , to the extent required by
law, such terms, responsibilities and powers
shall be incorporated herein by reference and
shall be a part of this Agreement and provided
further that the Company expressly understands
and agrees that any such collective investment
fund may provide for the lending of its
securities by the collective investment fund
trustee and that such collective investment fund
trustee will receive compensation for the
lending of securities that is separate from any
compensation of the Trustee hereunder, or any
compensation of the collective investment fund
trustee for the management of such fund; to
purchase or sell stock index future contracts
from time to time only to provide liquidity for
cash flows, and reduce tracking error due to
dividend accruals.
Notwithstanding anything else in this
Agreement to the contrary, including, without
limitation, any specific or general power
granted to the Trustee and to the Investment
Managers, including the power to invest in real
property, no portion of the Fund shall be
invested in real estate. For this purpose "real
estate" includes direct interests in real
property, leaseholds or mineral interests."
j. Section 10.04 of the First Amendment is hereby
amended to provide as follows:
"Any notice required by this Agreement to be
given to the Company or the Successor Trustee
shall be deemed to have been properly given when
mailed, postage prepaid, by registered or
certified mail, to the person to be notified as
set forth below:
If to the Company:
Gulf States Utilities Company
P.O. Box 61000
New Orleans, Louisiana 70161
Attention: Steven C. McNeal
If to the Successor Trustee:
Mellon Bank, N.A.
One Mellon Bank Center
Room 3346
Pittsburgh, Pennsylvania 15258-0001
Attention: Earl G. Kleckner
The Company or the Successor Trustee may change
the above addresses by delivering notice thereof
in writing to the other party."
k. Section 10.06 of the First Amendment is hereby
amended by replacing "New York" with "Texas".
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Second Amendment to be duly executed by their respective
authorized officers as of the effective date indicated on the
first page hereof.
GULF STATES UTILITIES COMPANY MELLON BANK, N.A. Successor Trustee
By: _________________________ By: _______________________________
William J. Regan, Jr.
Title: Vice President Title:
and Treasurer ____________________________
Date: Date:
____________________________ ____________________________
<PAGE>
STATE OF LOUISIANA
PARISH OF ORLEANS
Personally came and appeared before me, the undersigned
authority, in and for the jurisdiction aforesaid,
__________________________________, who acknowledged to
me that he is _____________________________________ of
Gulf States Utilities Company and that he signed and
delivered the foregoing instrument on the day and year
therein mentioned as the act and deed of said
corporation, having first been duly authorized so to do.
Given under my hand and official seal on this the ___
day of _____________, 19____.
____________________________
NOTARY PUBLIC
My Commission is issued for life.
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF ALLEGHENY
Personally came and appeared before me, the
undersigned authority, in and for the jurisdiction
aforesaid, ___________________________, who acknowledged
to me that he is _________________________________ of
Mellon Bank, N.A. and that he signed and delivered the
foregoing instrument on the day and year therein
mentioned as the act and deed of said corporation,
having first been duly authorized so to do.
Given under my hand and official seal on this the ___
day of _____________, 19____.
_______________________
NOTARY PUBLIC
My Commission Expires: _________________
Exhibit 10(d)33
AMENDMENT NO. 1
This AMENDMENT NO. 1 (this "Amendment") is dated as of
January 31, 1996 and entered into by and among RIVER BEND FUEL
SERVICES, INC., a Delaware corporation (the "Borrower"), the
financial institutions listed on the signature pages hereof
(collectively, the "Lenders") and CIBC INC., as Agent for the
Lenders (the "Agent") and is made with reference to that certain
Credit Agreement dated as of December 29, 1993 (the "Credit
Agreement"), by and between the Borrower and CIBC Inc. as the
sole initial Lender and the Agent. Capitalized terms used herein
without definition shall have the same meanings herein as set
forth in the Credit Agreement.
RECITALS
WHEREAS, the Borrower, the Lender and the Agent wish to
amend the Credit Agreement to increase the Commitment Amount from
$25,000,000 to $30,000,000; and
WHEREAS, subject to the terms and conditions of this
Amendment, the Agent and the Lender are willing to agree to such
amendment;
NOW, THEREFORE, in consideration of the premises and
the agreements, provisions and covenants herein contained, the
parties hereto agree as follows:
SECTION 1. AMENDMENTS
(a) Section 1.1 of the Credit Agreement is hereby amended
so that the amount "$30,000,000" is substituted for the amount
"$25,000,000" in the definition of "Commitment Amount" contained
therein.
(b) Section 1.1 of the Credit Agreement is hereby further
amended so that the definition of "Disclosure Documents"
contained therein reads in its entirety as follows:
"Disclosure Documents" means the following documents:
(i) the annual report of GSU on Form 10-K for the
fiscal year ended December 31, 1994;
(ii) GSU's quarterly reports on Form 10-Q for the
quarters ended March 31, June 30, and September 30, 1995;
and
(iii) the periodic reports of GSU on Form 8-K dated
July 26, 1995 and October 25, 1995, and any other periodic
reports of GSU filed with the Securities and Exchange
Commission which have been delivered to the Lenders before
January 31, 1996."
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective as of the
date hereof only upon the satisfaction of all of the following
conditions precedent (upon such satisfaction, the "Amendment
Effective Date") on or before January 31, 1996:
(a) Resolutions, etc. The Agent shall have received from
the Borrower and GSU a certificate, dated the Amendment Effective
Date, of its Authorized Officer as to
(i) resolutions of its Board of Directors or a
committee thereof then in full force and effect authorizing
the execution, delivery and performance of this Amendment,
the Notes and each other Loan Document to be executed by it;
and
(ii) the incumbency and signatures of those of its
officers authorized to act with respect to this Amendment,
the Notes and each other Loan Document executed by it,
upon which certificate each Lender may conclusively rely until it
shall have received a further certificate of an Authorized
Officer of such Obligor canceling or amending such prior
certificate.
(b) Delivery of Replacement Note. The Agent shall have
received, for the account of the Lender, its Note (substantially
in the form of Exhibit A hereto) duly executed and delivered by
the Borrower and duly authenticated by the Indenture Trustee, in
replacement of the Note No. BR-1 dated December 29, 1993 of the
Borrower payable to the order of CIBC Inc. in the maximum
principal amount of $25,000,000 which shall be marked "exchanged"
and delivered to the Indenture Trustee for cancellation.
(c) Reaffirmations of Loan Documents. The Agent shall have
received reaffirmations, dated the Amendment Effective Date, duly
executed by the appropriate Obligor, of the Loan Documents
delivered on the Effective Date substantially in the form of
Exhibit J and Exhibit K to the Credit Agreement.
(d) Opinions of Counsel. The Agent shall have received
opinions, dated the Amendment Effective Date and addressed to the
Agent and the Lender, from
(i) Laurence M. Hamric, acting as Louisiana and Texas
counsel to GSU, substantially in the form of Exhibit B
hereto;
(ii) Morgan, Lewis & Bockius, New York counsel for the
Borrower, substantially in the form of Exhibit C hereto; and
(iii) Mayer, Brown & Platt, counsel to the Agent,
substantially in the form of Exhibit D hereto.
(e) Closing Fees, Expenses, etc. The Agent shall have
received for its own account, or for the account of each Lender,
as the case may be, all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 10.3 of the Credit Agreement, if
then invoiced.
(f) Trust Indenture. The Agent shall have received an
executed original of each order, certificate and opinion
delivered to the Indenture Trustee by the Borrower under Section
12.2 of the Trust Indenture in connection with the replacement
Note being provided in connection with this Amendment.
(g) Trust Agreement. The Agent shall have received an
executed original of each instruction, certificate and other
document delivered to the Owner Trustee under the Trust Agreement
in connection with the replacement Note being provided in
connection with this Amendment.
(h) Agent and Lenders Execution. On or before the
Amendment Effective Date, the Agent and the Lenders shall have
delivered to the Agent originally executed copies of this
Amendment.
(i) Compliance with Warranties, No Default, etc. The
following statements shall be true and correct on the Amendment
Effective Date, before and after giving effect to this Amendment,
and the Borrower shall have delivered to the Agent a certificate
of an Authorized Officer of the Borrower to the effect that the
following statements are true and correct on the Amendment
Effective Date, before and after giving effect to this Amendment,
(i) the representations and warranties set forth in
Article VI of the Credit Agreement (excluding, however,
those contained in Section 6.7 of the Credit Agreement)
shall be true and correct with the same effect as if then
made (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true
and correct as of such earlier date);
(ii) except as disclosed by the Borrower to the Agent
and the Lenders pursuant to Section 6.7 of the Credit
Agreement
(1) no labor controversy, litigation, arbitration
or governmental investigation or proceeding shall be
pending or, to the knowledge of the Borrower,
threatened against the Borrower or any Obligor which
would reasonably be expected to materially adversely
affect the Borrower's or such Obligor's business,
operations, assets, revenues, properties or prospects
or which purports to affect the legality, validity or
enforceability of this Amendment, the Credit Agreement
as amended hereby (the "Amended Credit Agreement", the
Notes or any other Loan Document or any other Basic
Document; and
(2) no development shall have occurred in any
labor controversy, litigation, arbitration or
governmental investigation or proceeding disclosed
pursuant to Section 6.7 of the Credit Agreement which
would reasonably be expected to materially adversely
affect the businesses, operations, assets, revenues,
properties or prospects of the Borrower or any Obligor;
(iii) no Default shall have then occurred and be
continuing, and neither the Borrower nor any other Obligor
is in material violation of any law or governmental
regulation or court order or decree which would reasonably
be expected to materially adversely affect the businesses,
operations, assets, revenues, properties or prospects of the
Borrower or any Obligor; and
(iv) the Authorization of the Chief Accountant of the
Federal Energy Regulatory Commission dated December 9, 1988
(OCA-DAS-DA-681, Docket No. ES88-59-000) (the "FERC Order")
previously delivered to the Agent shall be in full force and
effect, without any modification.
(j) Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any
other Obligor shall be satisfactory in form and substance to the
Agent and its counsel; the Agent and its counsel shall have
received all information, approvals, opinions, documents or
instruments as the Agent or its counsel may reasonably request.
SECTION 3. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce the Agent and the Lenders to enter into
this Amendment and to amend the Credit Agreement in the manner
provided herein, the Borrower represents and warrants to the
Agent and each Lender that the following statements are true,
correct and complete:
(a) Corporate Power and Authority. The Borrower has all
requisite corporate power and authority to enter into this
Amendment and to carry out the transactions contemplated by, and
perform its obligations under, the Amended Credit Agreement and
the Notes.
(b) Authorization of Agreements. The execution and
delivery of this Amendment and the Notes and the performance of
the Amended Credit Agreement and the Notes have been duly
authorized by all necessary corporate action on the part of the
Borrower.
(c) No Conflict. The execution and delivery by the
Borrower of this Amendment and the Notes and the performance by
the Borrower of the Amended Credit Agreement and the Notes do not
and will not (i) violate any provision of any law or any
governmental rule or regulation applicable to the Borrower or any
Obligor, the Certificate or Articles of Incorporation or Bylaws
of the Borrower or any Obligor or any order, judgment or decree
of any court or other agency of government binding on the
Borrower or any Obligor, (ii) conflict with, result in a breach
of or constitute (with due notice or lapse of time or both) a
default under any contractual obligation of the Borrower or any
Obligor, (iii) result in or require the creation or imposition of
any Lien upon any of the properties or assets of the Borrower or
any Obligor (except as provided in the Basic Documents), or (iv)
require any approval of stockholders or any approval or consent
of any Person under any contractual obligation of the Borrower or
any Obligor.
(d) Governmental Consents. The execution and delivery by
the Borrower of this Amendment and the Notes and the performance
by the Borrower of the Amended Credit Agreement and the Notes do
not and will not require any registration with, consent or
approval of, or notice to, or other action to, with or by, any
federal, state or other governmental authority or regulatory
body, except for the FERC Order.
(e) Binding Obligation. This Amendment, the Notes and the
Amended Credit Agreement have been duly executed and delivered by
the Borrower and are the legally valid and binding obligations of
the Borrower, enforceable against the Borrower in accordance with
their respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by equitable
principles of general application.
(f) Incorporation of Representations and Warranties From
Credit Agreement. The representations and warranties contained
in Article VI of the Credit Agreement are and will be true,
correct and complete in all material respects on and as of the
Amendment Effective Date to the same extent as through made on
and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date, in which
case they were true, correct and complete in all material
respects on and as of such earlier date.
(g) Absence of Default. No event has occurred and is
continuing or will result from the consummation of the
transactions contemplated by this Amendment that would constitute
a Default.
(h) Basic Documents. No modifications or amendments have
been made to the Basic Documents in effect on the Effective Date
and previously delivered to the Agent except as contemplated
thereby or hereby in connection with the issuance of Additional
Notes.
(i) Series D Notes. On the date hereof the Borrower is
issuing and selling its Intermediate Term Secured Notes, 6.48%
Series D due January 31, 1999 in the aggregate principal amount
of $20,000,000, which constitute Additional Notes, and the
issuance thereof has been completed prior to the execution and
delivery of this Amendment and the making of any additional
borrowing under the Amended Credit Agreement on the Amendment
Effective Date.
SECTION 4. MISCELLANEOUS
(a) Reference to and Effect on the Credit Agreement and the
other Loan Documents.
(1) On and after the Amendment Effective Date, each
reference in the Credit Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import
referring to the Credit Agreement, and each reference in the
other Loan Documents to the "Credit Agreement",
"thereunder", "thereof" or words of like import referring to
the Credit Agreement shall mean and be a reference to the
Amended Credit Agreement.
(2) Except as specifically amended by this Amendment,
the Credit Agreement and the other Loan Documents shall
remain in full force and effect and are hereby ratified and
confirmed.
(3) The execution, delivery and performance of this
Amendment shall not constitute a waiver of any provision of,
or operate as a waiver of any right, power or remedy of the
Agent or any Lender under, the Credit Agreement or any of
the other Credit Documents.
(b) Fees and Expenses. The Borrower acknowledges that all
costs, fees and expenses as described in Section 10.3 of the
Credit Agreement incurred by the Agent and its counsel with
respect to this Amendment and the documents and transactions
contemplated hereby shall be for the account of the Borrower.
(c) Headings. Section and subsection headings in this
Amendment are included herein for convenience of reference only
and shall not constitute a part of this Amendment for any other
purpose or be given any substantive effect.
(d) Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and
delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all
signature pages are physically attached to the same document.
(e) Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES.
[Signature pages follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first written
above.
RIVER BEND FUEL SERVICES, INC.
By:_____________________________
Title:__________________________
CIBC INC., as Agent
By:_____________________________
Title:__________________________
PERCENTAGE COMMITMENT LENDER
100% $30,000,000 CIBC INC.
By:_____________________________
Title:__________________________
<TABLE>
<CAPTION>
Exhibit 12(a)
Arkansas Power and Light Company
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $133,854 $120,317 $107,771 $101,439 $102,339
Interest on notes payable -- 117 349 1,311 678
Amortization of expense and premium on debt-net(cr) 1,112 1,359 2,702 4,563 4,514
Other interest 1,303 2,308 8,769 3,501 7,806
Interest applicable to rentals 21,969 17,657 16,860 19,140 18,158
------------------------------------------------
Total fixed charges, as defined 158,238 141,758 136,451 129,954 133,495
Preferred dividends, as defined (a) 31,458 32,195 30,334 23,234 27,636
------------------------------------------------
Combined fixed charges and preferred dividends, as defined $189,696 $173,953 $166,785 $153,188 $161,131
================================================
Earnings as defined:
Net Income $143,451 $130,529 $205,297 $142,263 $136,666
Add:
Provision for income taxes:
Federal & State 44,418 57,089 58,162 83,300 105,964
Deferred - net 11,048 3,490 34,748 (17,939) (28,225)
Investment tax credit adjustment - net (1,600) (9,989) (10,573) (36,141) (5,658)
Fixed charges as above 158,238 141,758 136,451 129,954 133,495
------------------------------------------------
Total earnings, as defined $355,555 $322,877 $424,085 $301,437 $342,242
================================================
Ratio of earnings to fixed charges, as defined 2.25 2.28 3.11 2.32 2.56
================================================
Ratio of earnings to combined fixed charges and
preferred dividends, as defined 1.87 1.86 2.54 1.97 2.12
================================================
- - - - ------------------------
(a) "Preferred dividends," as defined by SEC regulation S-K, are
computed by dividing the preferred dividend requirement by one
hundred percent (100%) minus the income tax rate.
</TABLE>
<TABLE>
<CAPTION>
Exhibit 12(b)
Gulf States Utilities Company
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $201,335 $197,218 $172,494 $167,082 $181,994
Interest on notes payable 27,953 21,155 19,440 20,203 810
Other interest 29,169 26,564 10,561 7,957 8,074
Amortization of expense and premium on debt-net(cr) 1,999 3,479 8,104 8,892 9,346
Interest applicable to rentals 24,049 23,759 23,455 21,539 16,648
------------------------------------------------
Total fixed charges, as defined 284,505 272,175 234,054 225,673 216,872
Preferred dividends, as defined (a) 90,146 69,617 65,299 52,210 44,651
------------------------------------------------
Combined fixed charges and preferred dividends, as defined $374,651 $341,792 $299,353 $277,883 $261,523
================================================
Earnings as defined:
Income (loss) from continuing operations before extraordinary items and
the cumulative effect of accounting changes $112,391 $139,413 $69,462 ($82,755) $122,919
Add:
Income Taxes 48,250 55,860 58,016 (62,086) 63,244
Fixed charges as above 284,505 272,175 234,054 225,673 216,872
------------------------------------------------
Total earnings, as defined $445,146 $467,448 $361,532 $80,832 $403,035
================================================
Ratio of earnings to fixed charges, as defined 1.56 1.72 1.54 0.36 1.86
================================================
Ratio of earnings to combined fixed charges and
preferred dividends, as defined 1.19 1.37 1.21 0.29 1.54
================================================
(a) "Preferred dividends," as defined by SEC regulation S-K, are computed by
dividing the preferred dividend requirement by one hundred percent
(100%) minus the income tax rate.
(b) Earnings for the year ended December 31, 1994 and 1990, for GSU were
not adequate to cover fixed charges by $144.8 million and $60.6
million, respectively. Earnings for the years ended December 31,
1994 and 1990, for GSU were not adequate to cover fixed charges
and preferred dividends by $197.1 million and $165.1 million,
respectively.
</TABLE>
<TABLE>
<CAPTION>
Exhibit 12(c)
Louisiana Power and Light Company
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $158,816 $128,672 $124,633 $124,820 $124,507
Interest on notes payable -- 150 898 1,948 1,932
Other interest charges 5,924 5,591 5,706 4,546 5,278
Amortization of expense and premium on debt - net(cr) 3,282 7,100 5,720 5,130 5,184
Interest applicable to rentals 11,381 9,363 8,519 8,332 9,332
-------------------------------------------------
Total fixed charges, as defined 179,403 150,876 145,476 144,776 146,233
Preferred dividends, as defined (a) 41,212 42,026 40,779 29,171 32,847
-------------------------------------------------
Combined fixed charges and preferred dividends, as defined $220,615 $192,902 $186,255 $173,947 $179,080
=================================================
Earnings as defined:
Net Income $166,572 $182,989 $188,808 $213,839 $201,537
Add:
Provision for income taxes:
Federal and State 8,684 36,465 70,552 79,260 114,665
Deferred Federal and State - net 67,792 51,889 43,017 21,580 8,148
Investment tax credit adjustment - net 8,244 (1,317) (2,756) (37,552) (5,699)
Fixed charges as above 179,403 150,876 145,476 144,776 146,233
-------------------------------------------------
Total earnings, as defined $430,695 $420,902 $445,097 $421,903 $464,884
=================================================
Ratio of earnings to fixed charges, as defined 2.40 2.79 3.06 2.91 3.18
=================================================
Ratio of earnings to combined fixed charges and
preferred dividends, as defined 1.95 2.18 2.39 2.43 2.60
=================================================
- - - - ------------------------
(a) "Preferred dividends," as defined by SEC regulation S-K, are computed by
dividing the preferred dividend requirement by one hundred percent
(100%) minus the income tax rate.
</TABLE>
<TABLE>
<CAPTION>
Exhibit 12(d)
Mississippi Power and Light Company
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $63,628 $60,709 $52,099 $46,081 $46,241
Interest on notes payable 953 36 7 1,348 474
Other interest charges 1,444 1,636 1,795 3,581 4,164
Amortization of expense and premium on debt-net(cr) 1,617 1,685 1,458 1,754 756
Interest applicable to rentals 574 521 1,264 1,716 2,173
-----------------------------------------------
Total fixed charges, as defined 68,216 64,587 56,623 54,480 53,808
Preferred dividends, as defined (a) 14,962 12,823 12,990 9,447 9,004
-----------------------------------------------
Combined fixed charges and preferred dividends, as defined $83,178 $77,410 $69,613 $63,927 $62,812
===============================================
Earnings as defined:
Net Income $63,088 $65,036 $101,743 $48,779 $68,667
Add:
Provision for income taxes:
Federal and State (1,001) 4,463 54,418 46,884 71,651
Deferred Federal and State - net 32,491 20,430 539 (26,763) (35,224)
Investment tax credit adjustment - net (1,634) (1,746) 1,036 (7,645) (1,550)
Fixed charges as above 68,216 64,587 56,623 54,480 53,808
------------------------------------------------
Total earnings, as defined $161,160 $152,770 $214,359 $115,735 $157,352
================================================
Ratio of earnings to fixed charges, as defined 2.36 2.37 3.79 2.12 2.92
================================================
Ratio of earnings to combined fixed charges and
preferred dividends, as defined 1.94 1.97 3.08 1.81 2.51
================================================
- - - - ------------------------
(a) "Preferred dividends," as defined by SEC regulation S-K, are computed by
dividing the preferred dividend requirement by one hundred percent
(100%) minus the income tax rate.
</TABLE>
<TABLE>
<CAPTION>
Exhibit 12(e)
New Orleans Public Service Inc.
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Combined Fixed Charges and Preferred Dividends
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $23,865 $22,934 $19,478 $16,382 $15,330
Interest on notes payable -- -- -- 153 130
Other interest charges 793 1,714 1,016 1,027 1,723
Amortization of expense and premium on debt-net(cr) 565 576 598 710 619
Interest applicable to rentals 517 444 544 1,245 916
--------------------------------------------
Total fixed charges, as defined 25,740 25,668 21,636 19,517 18,718
Preferred dividends, as defined (a) 3,582 3,214 2,952 2,071 1,964
--------------------------------------------
Combined fixed charges and preferred dividends, as defined $29,322 $28,882 $24,588 $21,588 $20,682
============================================
Earnings as defined:
Net Income $74,699 $26,424 $47,709 $13,211 $34,386
Add:
Provision for income taxes:
Federal and State 8,885 16,575 27,479 22,606 22,465
Deferred Federal and State - net 36,947 (340) 5,203 (15,674) (1,364)
Investment tax credit adjustment - net (591) (170) (744) (2,332) (634)
Fixed charges as above 25,740 25,668 21,636 19,517 18,718
---------------------------------------------
Total earnings, as defined $145,680 $68,157 $101,283 $37,328 $73,571
=============================================
Ratio of earnings to fixed charges, as defined 5.66 2.66 4.68 1.91 3.93
=============================================
Ratio of earnings to combined fixed charges and
preferred dividends, as defined 4.97 2.36 4.12 1.73 3.56
=============================================
- - - - ------------------------
(a) "Preferred dividends," as defined by SEC regulation S-K, are computed by
dividing the preferred dividend requirement by one hundred percent
(100%) minus the income tax rate.
(b) Earnings for the twelve months ended December 31, 1991 include the $90
million effect of the 1991 NOPSI Settlement.
</TABLE>
<TABLE>
<CAPTION>
Exhibit 12(f)
System Energy Resources, Inc.
Computation of Ratios of Earnings to Fixed Charges and
Ratios of Earnings to Fixed Charges
1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest on long-term debt $218,538 $196,618 $184,818 $162,517 $136,916
Interest on notes payable 0 0 0 88 473
Amortization of expense and premium on debt-net 7,495 6,417 4,520 6,731 6,104
Interest applicable to rentals 10,007 6,265 6,790 7,546 6,475
Other interest charges 3,617 1,506 1,600 7,168 8,019
--------------------------------------------
Total fixed charges, as defined $239,657 $210,806 $197,728 $184,050 $157,987
============================================
Earnings as defined:
Net Income $104,622 $130,141 $93,927 $5,407 $93,039
Add:
Provision for income taxes:
Federal and State (26,848) 35,082 48,314 67,477 120,830
Deferred Federal and State - net 37,168 23,648 60,690 (27,374) (41,871)
Investment tax credit adjustment - net 63,256 30,123 (30,452) (3,265) (3,466)
Fixed charges as above 239,657 210,806 197,728 184,050 157,987
--------------------------------------------
Total earnings, as defined $417,855 $429,800 $370,207 $226,295 $326,519
============================================
Ratio of earnings to fixed charges, as defined 1.74 2.04 1.87 1.23 2.07
============================================
</TABLE>
Exhibit 18(a)
February 27, 1996
Arkansas Power & Light Company
425 West Capital Avenue, 40th Floor
Little Rock, Arkansas 72201
Gentlemen:
We are providing this letter to you for inclusion as an exhibit
to your Form 10-K filing pursuant to Item 601 of Regulation S-K.
We have read management's justification contained in the
Company's Financial Statements which are included in its Form 10-
K for the year ended December 31, 1995, for the change in
accounting principle from accruing for anticipated incremental
nuclear plant outage maintenance costs during the operating
period between outages to capitalizing incremental nuclear plant
outage maintenance costs as incurred and amortizing them to
expense during the operating period between outages. Based on
our reading of the data, including an audit report on the Company
by the Federal Energy Regulatory Commission, and discussions with
Company officials of the business judgment and business planning
factors relating to the change, we believe management's
justification to be reasonable. Accordingly, we concur that the
newly adopted accounting principle described above is preferable
in the Company's circumstances to the method previously applied.
Very truly yours,
COOPERS & LYBRAND L.L.P.
Exhibit 18(b)
February 27, 1996
Entergy Corporation
639 Loyola Avenue
New Orleans, Louisiana 70113
Gentlemen:
We are providing this letter to you for inclusion as an exhibit
to your Form 10-K filing pursuant to Item 601 of Regulation S-K.
We have read management's justification contained in the
Company's Financial Statements which are included in its Form 10-
K for the year ended December 31, 1995, for the change in
accounting principle of the Arkansas Power & Light Company from
accruing for anticipated incremental nuclear plant outage
maintenance costs during the operating period between outages to
capitalizing incremental nuclear plant outage maintenance costs
as incurred and amortizing them to expense during the operating
period between outages. Based on our reading of the data,
including an audit report on the Company by the Federal Energy
Regulatory Commission, and discussions with Company officials of
the business judgment and business planning factors relating to
the change, we believe management's justification to be
reasonable. Accordingly, we concur that the newly adopted
accounting principle described above is preferable in the
Company's circumstances to the method previously applied.
Very truly yours,
COOPERS & LYBRAND L.L.P.
Exhibit 21
The seven registrants, Entergy Corporation, System Energy Resources,
Inc., Arkansas Power & Light Company, Gulf States Utilities Company,
Louisiana Power & Light Company, Mississippi Power & Light Company and New
Orleans Public Service Inc., and their active subsidiaries, are listed
below:
State or Other
Jurisdiction of
Incorporation
Entergy Corporation Delaware
System Energy Resources, Inc. (a) Arkansas
Arkansas Power & Light Company (a) Arkansas
The Arklahoma Corporation (b) Arkansas
Gulf States Utilities Company (a) Texas
Varibus Corporation (c) Texas
GSG&T, Inc. (c) Texas
Southern Gulf Railway Company (c) Texas
Prudential Oil & Gas, Inc.(c) Texas
Louisiana Power & Light Company (a) Louisiana
Mississippi Power & Light Company (a) Mississippi
New Orleans Public Service Inc. (a) Louisiana
System Fuels, Inc.(d) Louisiana
Entergy Services, Inc. (a) Delaware
Entergy Power, Inc. (a) Delaware
Entergy Operations, Inc. (a) Delaware
Entergy Enterprises, Inc. (a) Louisiana
Entergy S.A. (a) Argentina
Entergy Argentina S.A. (a) Argentina
Entergy Argentina S.A. Ltd. (a) Cayman Islands
Entergy Transener S.A. (a) Argentina
Entergy Power Development Corporation (a) Delaware
Entergy Richmond Power Corporation (e) Delaware
Entergy Systems and Service, Inc. (f) Delaware
Entergy Pakistan LTD (e) Delaware
Entergy Power Asia LTD (e) Cayman Islands
Entergy Power Development International
Corporation (a) Delaware
Entergy Power Holding I, LTD (e) Cayman Islands
EP Edgel, Inc. (e) Delaware
Entergy Power CBA Holding II LTD (g) Bermuda
Generandes, Co (h) Cayman Islands
Edgel S.A. (i) Delaware
EPG Cayman, Holding I (j) Cayman Islands
EPG Cayman, Holding II (j) Cayman Islands
Entergy Victoria LDC (k) Cayman Islands
Entergy Power Holding LDC (l) Cayman Islands
CitiPower Trust (m) Australia
CitiPower Ltd. (n) Australia
Entergy Power Edesur Holding LTD (o) Bermuda
Entergy Power Marketing Corporation (a) Delaware
_______________________
(a)Entergy Corporation owns all of the Common Stock of System Energy
Resources, Inc., Arkansas Power & Light Company, Gulf States Utilities
Company, Louisiana Power & Light Company, Mississippi Power & Light
Company, New Orleans Public Service Inc., Entergy Services, Inc.,
Entergy Power, Inc., Entergy Operations, Inc., Entergy Enterprises,
Inc., Entergy, S.A., Entergy Argentina, S.A., Entergy Transener, S.A.,
Entergy Argentina S.A., Ltd., Entergy Power Development Corporation,
Entergy Power Development Corporation International, Entergy Power
Marketing Corporation, and Entergy System and Services, Inc.
(b)Arkansas Power & Light Company owns 34% of the Common Stock of The
Arklahoma Corporation.
(c)Gulf States Utilities Company owns all of the Common Stock of Varibus
Corporation, GSG&T, Inc., Southern Gulf Railway Company, and Prudential
Oil & Gas, Inc.
(d)The capital stock of System Fuels, Inc. is owned in proportions of 35%,
33%, 19% and 13% by Arkansas Power & Light Company, Louisiana Power &
Light Company, Mississippi Power & Light Company and New Orleans Public
Service Inc., respectively.
(e)Entergy Power Development Corporation owns all of the Common Stock of
Entergy Richmond Power Corporation, Entergy Pakistan LTD, Entergy Power
Asia LTD, Entergy Power Holding I, LTD, and EPG Edegel, Inc.
(f)Entergy Enterprises, Inc. owns all of the Common Stock of Entergy
Systems and Service, Inc.
(g)Entergy Power Holding I, LTD owns all of the Common Stock of Entergy
Power CBA Holding II LTD.
(h)E P Edegel, Inc. owns all of the Common Stock of Generandes, Co.
(i)Generandes, Co. owns all of the Common Stock of Edegel S.A.
(j)Entergy Power Development International Corporation owns all of the
Common Stock of EPG Cayman Holding I and EPG Cayman Holding II.
(k)EPG Cayman Holding II and EPG Cayman Holding I own 99% and 1%,
respectively, of the Common Stock of Entergy Victoria LDC.
(l)EPG Cayman Holding II and Entergy Victoria LDC own 99% and 1%.,
respectively, of the Common Stock of Entergy Victoria Holding LDC.
(m)Entergy Victoria LDC and Entergy Victoria Holding LDC own 99% and 1%,
respectively, of the Common Stock of CitiPower Trust.
(n)Entergy Victoria LDC and Entergy Victoria Holding LDC own 99% and 1%,
respectively, of the Common Stock of CitiPower Ltd.
(o)Entergy Argentina SA and Entergy Argentina S.A. Ltd. own all of the
Common Stock of Entergy Power Edesur Holding LTD.
Exhibit 24
DATE: January 26, 1996
TO: Louis E. Buck, Jr.
Laurence M. Hamric
FROM: Edwin Lupberger, et. al.
SUBJECT: Power of Attorney
Entergy Corporation, referred to herein as the Company, will
file with the Securities and Exchange Commission its Annual
Report on Form 10-K for the year ended December 31, 1995
pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934.
The Company and the undersigned, in their respective
capacities as directors and/or officers of said Company as
specified in Attachment I, do each hereby make, constitute
and appoint Louis E. Buck, Jr. and Laurence M. Hamric, and
each of them, their true and lawful Attorneys (with full
power of substitution) for each of the undersigned and in
his or her name, place and stead to sign and cause to be
filed with the Securities and Exchange Commission the
aforementioned Annual Report on Form 10-K and any amendments
thereto.
Yours very truly,
Entergy Corporation
By: /s/ Edwin Lupberger
Edwin Lupberger Gerald D. McInvale
Chairman of the Board and Senior Vice President
and Chief Executive Officer Chief Financial Officer
<PAGE>
__/s/ W. Frank Blount ____/s/ John A. Cooper,Jr.
W. Frank Blount John A. Cooper, Jr.
__/s/ Lucie J. Fjeldstad __/s/ Norman C. Francis
Lucie J. Fjeldstad Norman C. Francis
__/s/ Kaneaster Hodges, Jr. ____/s/ Robert v.d. Luft
Kaneaster Hodges, Jr. Robert v.d. Luft
___/s/ Edwin Lupberger ___/s/ Kinnaird R. McKee
Edwin Lupberger Kinnaird R. McKee
___/s/ Paul W. Murrill _____/s/ James R. Nichols
Paul W. Murrill James R. Nichols
_____/s/ Eugene H. Owen ___/s/ John N. Palmer, Sr.
Eugene H. Owen John N. Palmer, Sr.
_____/s/ Robert D. Pugh ___/s/ H. Duke Shackelford
Robert D. Pugh H. Duke Shackelford
___/s/ Wm. Clifford Smith __/s/ Bismark A. Steinhagen
Wm. Clifford Smith Bismark A. Steinhagen
<PAGE>
Entergy Corporation
Chairman of the Board, President, Chief Executive Officer
and Director (principal executive officer) - Edwin Lupberger
Executive Vice President and Chief Financial Officer
(principal financial officer) - Gerald D. McInvale
Directors - W. Frank Blount, John A. Cooper, Jr., Lucie J.
Fjeldstad, Norman C. Francis, Kaneaster Hodges, Jr., Robert
v.d. Luft, Kinnaird R. McKee, Paul W. Murrill,
James R. Nichols, Eugene H. Owen, John N. Palmer, Sr.,
Robert D. Pugh, H. Duke Shackelford, Wm. Clifford Smith,
Bismark A. Steinhagen.
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This legend contains summary financial information extracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000065984
<NAME> ENTERGY CORPORATION
<SUBSIDIARY>
<NUMBER> 017
<NAME> ENTERGY CORPORATION AND SUBSIDIARIES (CONSOLIDATED)
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 15,820,791
<OTHER-PROPERTY-AND-INVEST> 712,335
<TOTAL-CURRENT-ASSETS> 2,315,240
<TOTAL-DEFERRED-CHARGES> 3,417,564
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 22,265,930
<COMMON> 2,300
<CAPITAL-SURPLUS-PAID-IN> 4,201,483
<RETAINED-EARNINGS> 2,335,579
<TOTAL-COMMON-STOCKHOLDERS-EQ> 6,471,720
253,460
550,955
<LONG-TERM-DEBT-NET> 6,777,124
<SHORT-TERM-NOTES> 45,667
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 558,650
0
<CAPITAL-LEASE-OBLIGATIONS> 303,664
<LEASES-CURRENT> 151,140
<OTHER-ITEMS-CAPITAL-AND-LIAB> 7,085,898
<TOT-CAPITALIZATION-AND-LIAB> 22,265,930
<GROSS-OPERATING-REVENUE> 6,274,428
<INCOME-TAX-EXPENSE> 349,528
<OTHER-OPERATING-EXPENSES> 4,705,690
<TOTAL-OPERATING-EXPENSES> 5,054,690
<OPERATING-INCOME-LOSS> 1,219,738
<OTHER-INCOME-NET> 37,443
<INCOME-BEFORE-INTEREST-EXPEN> 1,257,181
<TOTAL-INTEREST-EXPENSE> 737,201
<NET-INCOME> 519,980
0
<EARNINGS-AVAILABLE-FOR-COMM> 519,980
<COMMON-STOCK-DIVIDENDS> 408,553
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 1,396,731
<EPS-PRIMARY> 2.28
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This schedule contains summary financial information extracted from Entergy's
financial statementsfor the year ended December 31, 1995, and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000007323
<NAME> ARKANSAS POWER AND LIGHT COMPANY
<SUBSIDIARY>
<NUMBER> 001
<NAME> ARKANSAS POWER AND LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2,859,940
<OTHER-PROPERTY-AND-INVEST> 183,039
<TOTAL-CURRENT-ASSETS> 551,585
<TOTAL-DEFERRED-CHARGES> 609,851
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 4,204,415
<COMMON> 470
<CAPITAL-SURPLUS-PAID-IN> 590,844
<RETAINED-EARNINGS> 492,386
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,083,700
49,027
176,350
<LONG-TERM-DEBT-NET> 1,281,203
<SHORT-TERM-NOTES> 667
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 28,700
0
<CAPITAL-LEASE-OBLIGATIONS> 93,574
<LEASES-CURRENT> 54,697
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,436,497
<TOT-CAPITALIZATION-AND-LIAB> 4,204,415
<GROSS-OPERATING-REVENUE> 1,648,233
<INCOME-TAX-EXPENSE> 53,936
<OTHER-OPERATING-EXPENSES> 1,376,366
<TOTAL-OPERATING-EXPENSES> 1,430,302
<OPERATING-INCOME-LOSS> 217,931
<OTHER-INCOME-NET> 67,063
<INCOME-BEFORE-INTEREST-EXPEN> 284,994
<TOTAL-INTEREST-EXPENSE> 112,914
<NET-INCOME> 172,080
18,093
<EARNINGS-AVAILABLE-FOR-COMM> 153,987
<COMMON-STOCK-DIVIDENDS> 153,400
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 338,358
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This legend contains summary financial information extracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such fianacial statements.
</LEGEND>
<CIK> 0000044570
<NAME> GULF STATES UTILITY COMPANY
<SUBSIDIARY>
<NUMBER> 003
<NAME> GULF STATES UTILITIES COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 4,697,194
<OTHER-PROPERTY-AND-INVEST> 62,569
<TOTAL-CURRENT-ASSETS> 745,842
<TOTAL-DEFERRED-CHARGES> 1,356,453
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 6,861,058
<COMMON> 114,055
<CAPITAL-SURPLUS-PAID-IN> 1,152,505
<RETAINED-EARNINGS> 357,704
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,624,264
87,654
136,444
<LONG-TERM-DEBT-NET> 2,145,471
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 145,425
0
<CAPITAL-LEASE-OBLIGATIONS> 108,087
<LEASES-CURRENT> 37,773
<OTHER-ITEMS-CAPITAL-AND-LIAB> 2,395,949
<TOT-CAPITALIZATION-AND-LIAB> 6,861,058
<GROSS-OPERATING-REVENUE> 1,861,974
<INCOME-TAX-EXPENSE> 57,235
<OTHER-OPERATING-EXPENSES> 0
<TOTAL-OPERATING-EXPENSES> 1,500,310
<OPERATING-INCOME-LOSS> 304,429
<OTHER-INCOME-NET> 17,689
<INCOME-BEFORE-INTEREST-EXPEN> 322,118
<TOTAL-INTEREST-EXPENSE> 199,199
<NET-INCOME> 122,919
29,643
<EARNINGS-AVAILABLE-FOR-COMM> 93,276
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 400,754
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This legend contains summary financial information extracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000060527
<NAME> LOUISIANA POWER AND LIGHT COMPANY
<SUBSIDIARY>
<NUMBER> 009
<NAME> LOUISIANA POWER AND LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 3,537,650
<OTHER-PROPERTY-AND-INVEST> 73,963
<TOTAL-CURRENT-ASSETS> 331,912
<TOTAL-DEFERRED-CHARGES> 387,998
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 4,331,523
<COMMON> 1,088,900
<CAPITAL-SURPLUS-PAID-IN> (4,836)
<RETAINED-EARNINGS> 72,150
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,156,214
100,009
160,500
<LONG-TERM-DEBT-NET> 1,385,171
<SHORT-TERM-NOTES> 76,459
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 35,260
0
<CAPITAL-LEASE-OBLIGATIONS> 43,362
<LEASES-CURRENT> 28,000
<OTHER-ITEMS-CAPITAL-AND-LIAB> 953,763
<TOT-CAPITALIZATION-AND-LIAB> 4,331,523
<GROSS-OPERATING-REVENUE> 1,674,875
<INCOME-TAX-EXPENSE> 116,486
<OTHER-OPERATING-EXPENSES> 1,226,606
<TOTAL-OPERATING-EXPENSES> 1,342,606
<OPERATING-INCOME-LOSS> 332,269
<OTHER-INCOME-NET> 4,153
<INCOME-BEFORE-INTEREST-EXPEN> 328,116
<TOTAL-INTEREST-EXPENSE> 134,885
<NET-INCOME> 201,537
21,307
<EARNINGS-AVAILABLE-FOR-COMM> 180,230
<COMMON-STOCK-DIVIDENDS> 221,500
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 384,657
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This ledgend contains summary financial information extracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such fianacial statements.
</LEGEND>
<CIK> 0000066901
<NAME> MISSISSIPPI POWER AND LIGHT COMPANY
<SUBSIDIARY>
<NUMBER> 010
<NAME> MISSISSIPPI POWER AND LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,001,686
<OTHER-PROPERTY-AND-INVEST> 11,146
<TOTAL-CURRENT-ASSETS> 281,482
<TOTAL-DEFERRED-CHARGES> 287,669
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 1,581,983
<COMMON> 199,326
<CAPITAL-SURPLUS-PAID-IN> (218)
<RETAINED-EARNINGS> 231,463
<TOTAL-COMMON-STOCKHOLDERS-EQ> 430,571
16,770
57,881
<LONG-TERM-DEBT-NET> 494,404
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 61,015
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 521,342
<TOT-CAPITALIZATION-AND-LIAB> 1,581,983
<GROSS-OPERATING-REVENUE> 889,843
<INCOME-TAX-EXPENSE> 33,716
<OTHER-OPERATING-EXPENSES> 0
<TOTAL-OPERATING-EXPENSES> 739,445
<OPERATING-INCOME-LOSS> 116,672
<OTHER-INCOME-NET> 2,825
<INCOME-BEFORE-INTEREST-EXPEN> 119,497
<TOTAL-INTEREST-EXPENSE> 50,830
<NET-INCOME> 68,667
7,515
<EARNINGS-AVAILABLE-FOR-COMM> 61,152
<COMMON-STOCK-DIVIDENDS> 61,700
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 184,943
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This legend contains summary financial informationextracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000071508
<NAME> NEW ORLEANS PUBLIC SERVICE, INC.
<SUBSIDIARY>
<NUMBER> 011
<NAME> NEW ORLEANS PUBLIC SERVICE, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 287,168
<OTHER-PROPERTY-AND-INVEST> 3,259
<TOTAL-CURRENT-ASSETS> 148,867
<TOTAL-DEFERRED-CHARGES> 156,912
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 596,206
<COMMON> 33,744
<CAPITAL-SURPLUS-PAID-IN> 36,306
<RETAINED-EARNINGS> 81,261
<TOTAL-COMMON-STOCKHOLDERS-EQ> 151,311
0
19,780
<LONG-TERM-DEBT-NET> 155,958
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 38,250
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 230,907
<TOT-CAPITALIZATION-AND-LIAB> 596,206
<GROSS-OPERATING-REVENUE> 474,670
<INCOME-TAX-EXPENSE> 19,836
<OTHER-OPERATING-EXPENSES> 403,940
<TOTAL-OPERATING-EXPENSES> 423,776
<OPERATING-INCOME-LOSS> 50,894
<OTHER-INCOME-NET> 1,166
<INCOME-BEFORE-INTEREST-EXPEN> 52,060
<TOTAL-INTEREST-EXPENSE> 17,674
<NET-INCOME> 34,386
1,411
<EARNINGS-AVAILABLE-FOR-COMM> 32,975
<COMMON-STOCK-DIVIDENDS> 30,600
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 99,275
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
This legend contains summary financial information extracted from Entergy's
financial statements for the year ended December 31, 1995, and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000202584
<NAME> SYSTEM ENERGY RESOURCES, INC.
<SUBSIDIARY>
<NUMBER> 012
<NAME> SYSTEM ENERGY RESOURCES, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2,667,176
<OTHER-PROPERTY-AND-INVEST> 40,927
<TOTAL-CURRENT-ASSETS> 161,246
<TOTAL-DEFERRED-CHARGES> 561,663
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 3,431,012
<COMMON> 789,350
<CAPITAL-SURPLUS-PAID-IN> 7
<RETAINED-EARNINGS> 85,920
<TOTAL-COMMON-STOCKHOLDERS-EQ> 875,277
0
0
<LONG-TERM-DEBT-NET> 1,219,917
<SHORT-TERM-NOTES> 2,990
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 250,000
0
<CAPITAL-LEASE-OBLIGATIONS> 44,107
<LEASES-CURRENT> 28,000
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,038,721
<TOT-CAPITALIZATION-AND-LIAB> 3,431,012
<GROSS-OPERATING-REVENUE> 605,639
<INCOME-TAX-EXPENSE> 77,410
<OTHER-OPERATING-EXPENSES> 291,934
<TOTAL-OPERATING-EXPENSES> 369,344
<OPERATING-INCOME-LOSS> 236,295
<OTHER-INCOME-NET> 6,287
<INCOME-BEFORE-INTEREST-EXPEN> 242,582
<TOTAL-INTEREST-EXPENSE> 149,543
<NET-INCOME> 93,039
0
<EARNINGS-AVAILABLE-FOR-COMM> 93,039
<COMMON-STOCK-DIVIDENDS> 92,800
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 96,460
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
Exhibit 99(a)3
[Letterhead of Clark, Thomas & Winters]
March 11, 1996
Gulf States Utilities Company
639 Loyola Avenue
New Orleans, Louisiana 70112
Attn: Scott Forbes
Re: SEC Form 10-K Gulf States Utilities Company (the
"Company") for the year ending December 31, 1995
Dear Mr. Forbes:
Our firm has rendered to the Company two opinion letters
dated September 30, 1992 and August 8, 1994, concerning certain
issues presented in the appeal of PUCT Docket No. 7195 now
pending in the Texas Supreme Court. In connection with the above-
referenced Form 10-K, we confirm to you as of the date hereof
that we continue to hold the opinions set forth in the letter
dated August 8, 1994 and in the September 30, 1992 letter which
addressed the recovery of $1.45 billion of abeyed construction
costs.1
CLARK, THOMAS & WINTERS,
A Professional Corporation
By: /s/ CLARK, THOMAS & WINTERS,
A Professional Corporation
_______________________________
1 The opinion letter dated September 30, 1992 indicates that
the amount of River Bend plant costs held in abeyance was $1.45
billion. The more correct amount, as indicated by the Company in
its securities filings to which those opinions related, is $1.4
billion.
