SECURITIES AN EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U5S
ANNUAL REPORT
For the Year Ended December 31, 1997
Filed pursuant to the Public Utility Holding Company Act of 1935 by
CENTRAL AND SOUTH WEST CORPORATION
1616 Woodall Rodger Freeway, Dallas, Texas 75202-1234
and
SOUTHWESTERN ELECTRIC POWER COMPANY
428 Travis Street, Shreveport, Louisiana 71156-0001
(Name and address of each registered holding company in the system)
<PAGE>
TABLE OF CONTENTS
PAGE
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF
DECEMBER 31, 1997 2 - 13
ITEM 2. ACQUISITIONS OR SALES OF UTILITY ASSETS 14
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM
SECURITIES 14
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES 14
ITEM 5. INVESTMENTS IN SECURITIES OF NON-SYSTEM COMPANIES 15 - 18
ITEM 6. OFFICERS AND DIRECTORS
Part I. Name, principal business address and positions
held as of December 31, 1997 19 - 46
Part II. Financial connections as of December 31, 1997 47
Part III. Compensation and other related information 48
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS 49
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS
Part I. Intercompany sales and service 50
Part II. Contracts to purchase services or goods between
any System company and any affiliate 50
Part III. Employment of any person by any System company
for the performance on a continuing basis of
management services 50 - 51
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES 52 - 57
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS
Index to Financial Statements 58 - 59
Reports of Independent Public Accountants 60 - 61
Financial Statements 62 - 77
Exhibits 78 - 85
SIGNATURES 86 - 87
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1997.
<TABLE>
<CAPTION>
NUMBER
OF
COMMON % OF ISSUER OWNER'S
SHARES VOTING BOOK BOOK
NAME OF COMPANY OWNED POWER VALUE (1) VALUE (1) BUSINESS TYPE
(thousands) (thousands)
- -------------------------------------- ---------- ---------- ----------- ---------- ------------------------
<S> <C> <C> <C> <C> <C>
CENTRAL AND SOUTH WEST CORPORATION (CSW OR Holding Company
THE CORPORATION)
CENTRAL POWER AND LIGHT COMPANY 6,755,535 100 $1,407,170 $1,407,170 Electric Utility
(CPL)
PUBLIC SERVICE COMPANY OF OKLAHOMA 9,013,000 100 474,226 474,225 Electric Utility
(PSO)
Ash Creek Mining Company 383,904 100 45 45 Coal Mining
SOUTHWESTERN ELECTRIC POWER COMPANY 7,536,640 100 704,709 704,709 Electric Utility
(SWEPCO)
The Arklahoma Corporation 238 47.6 360 135 Electric Transmission
Southwest Arkansas Utilities 100 100 10 10 Inactive
Corporation
WEST TEXAS UTILITIES COMPANY (WTU) 5,488,560 100 258,929 258,929 Electric Utility
CENTRAL AND SOUTH WEST SERVICES, 10,000 100 100 100 Service Company
INC. (CSWS)
CSW LEASING, INC. (CSWL) 800 80 15,781 12,625 Lease Trans.Equip.
CSW CREDIT, INC. (CREDIT) 247 100 54,174 54,174 Factor Accounts Rec
CSW COMMUNICATIONS, INC. (COMM) 1,000 100 (13, 475) (13,475) Communication Services
(Effective March 11, 1998,
the name was changed to C3
Communications, Inc.)
CSWC Southwest Holdings, Inc. (2) 100 100 4,745 4,745 Communication Services
CSWC TeleChoice Management, 100 100 48 48 Communication Services
Inc. (3)
CSW/ICG ChoiceCom Management, See (4) 50 48 48 Communication Services
L.L.C. (4)
CSWC TeleChoice, Inc. (5) 100 100 4,896 4,896 Communication Services
CSW/ICG ChoiceCom, L.P. (6) See (6) 50 4,743 4,743 Communication Services
CSW ENERGY, INC. (CSWE) 1,000 100 85,749 85,749 Independent Power
CSW Development-I, Inc. (CSWD-I) 1,000 100 47,005 47,005 Independent Power
Polk Power GP II, Inc. (7) 500 50 151 75 Independent Power
Polk Power GP, Inc. (8) 500 50 111 55 Independent Power
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1997.
<TABLE>
<CAPTION>
NUMBER
OF
COMMON % OF ISSUER OWNER'S
SHARES VOTING BOOK BOOK
NAME OF COMPANY OWNED POWER VALUE (1) VALUE (1) BUSINESS TYPE
(thousands) (thousands)
- -------------------------------------- ---------- ---------- ----------- ---------- ------------------------
<S> <C> <C> <C> <C> <C>
Orange Cogeneration GP II, Inc.(9) 500 50 70 35 Independent Power
Orange Cogeneration G.P., 500 50 16 8 Independent Power
Inc. (10)
CSW Mulberry II, Inc. (11) 1,000 100 23,988 23,988 Independent Power
CSW Mulberry, Inc. (12) 1,000 100 26,766 26,766 Independent Power
Polk Power Partners, LP (13) See (13) See (13) 55,049 25,735 Independent Power
Noah I Power GP, Inc. (14) 1,000 100 (16) (16) Independent Power
Noah I Power Partners, LP (15) See (15) See (15) 16,779 16,024 Independent Power
Brush Cogeneration Partners (16) See (16) See (16) 33,356 16,678 Independent Power
CSW Orange II, Inc. (17) 1,000 100 1 1 Independent Power
CSW Orange, Inc. (18) 1,000 100 4,163 4,163 Independent Power
Orange Cogeneration Limited See (19) See (19) 1,513 764 Independent Power
Partnership (19)
Orange Cogen Funding Corp. (20) 1,000 100 1 1 Independent Power
CSW Development-II, Inc. (CSWD-II) 1,000 100 (3,999) (3,999) Dormant
CSW Ft. Lupton, Inc. (CSWFL) 1,000 100 109,022 109,022 Independent Power
Thermo Cogeneration Partnership, See (21) See (21) (6,692) (3,346) Independent Power
L.P. (21)
Newgulf Power Venture, Inc. 1,000 100 9,997 9,997 Independent Power
(NEWGULF) (22)
CSW Sweeny GP I, Inc. (SWEENY) (23) 1,000 100 1,500 1,500 Independent Power
CSW Sweeny GP II, Inc. (24) 1,000 100 300 300 Independent Power
CSW Sweeny LP I, Inc. (SWEENY)(25) 1,000 100 1,470 1,470 Independent Power
CSW Sweeny LP II, Inc. (26) 1,000 100 14,700 14,700 Independent Power
Sweeny Cogeneration Limited See (27) See (27) 30,000 30,000 Independent Power
Partnership (27)
CSW Development-3, Inc. (CSWD3)(28) See (28) See (28) See (28) See (28) Dormant
CSW Northwest GP, Inc. (29) See (29) See (29) See (29) See (29) Dormant
CSW Northwest LP, Inc. (30) See (30) See (30) See (30) See (30) Dormant
CSW Power Marketing, Inc. (31) See (31) See (31) See (31) See (31) Dormant
CSW Nevada, Inc. (32) See (32) See (32) See (32) See (32) Dormant
CSW Services International, Inc.(33) See (33) See (33) See (33) See (33) Non-regulated Services
Diversified Energy Contractors See (34) See (34) Nominal Nominal Non-regulated Services
Company, LLC (34)
DECCO II LLC (35) See (35) See (35) See (35) See (35) Non-regulated Services
Diversified Energy Contractors, See (36) See (36) See (36) See (36) Non-regulated Services
L.P. (36)
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1997.
<TABLE>
<CAPTION>
NUMBER
OF
COMMON % OF ISSUER OWNER'S
SHARES VOTING BOOK BOOK
NAME OF COMPANY OWNED POWER VALUE (1) VALUE (1) BUSINESS TYPE
(thousands) (thousands)
- -------------------------------------- ---------- ---------- ----------- ---------- ------------------------
<S> <C> <C> <C> <C> <C>
CSW INTERNATIONAL, INC. (CSWI) (37) 1,000 100 810,296 810,296 International Activities
CSW International Two, Inc. (CSWI2) 1,000 100 913,562 913,562 Investment Company
CSW UK Finance Company (Finco)(38)427,275,002 90 802,319 722,087 Investment Company
CSW Investments (39) 699,750,001 93 1,241,700 1,154,782 Investment Company
SEEBOARD Group plc (40) 50,001 100 4,147 4,147 Holding Company
Seeboard (Generation) Limited (41) 1,000 100 605 605 Holding Company
Medway Power Limited 3,750 37.5 0 0 Generation
Seeboard Natural Gas Limited (42) 2 100 (375) (375) Holding Company
Beacon Gas Limited 3,000,000 50 (7,028) (3,514) Gas supply
SEEBOARD plc (43) 250,493,703 100 616,592 616,592 Foreign Utility
Appliance Protect Limited 2 100 0 0 Dormant
Direct Power Limited 2 100 0 0 Dormant
Directricity Limited 2 100 0 0 Dormant
Electricity (UK) Limited 2 100 0 0 Dormant
Electricity 2000 Limited 2 100 0 0 Dormant
Energy Express Limited 2 100 0 0 Dormant
First Electricity Limited 2 100 0 0 Dormant
First Gas Limited 2 100 0 0 Dormant
Gas 2000 Limited 2 100 0 0 Dormant
Home Electricity Company Limited 2 100 0 0 Dormant
Home Energy Company Limited 2 100 0 0 Dormant
Home Gas Company Limited 2 100 0 0 Dormant
Home Power Company Limited 2 100 0 0 Dormant
Horizon Natural Gas Limited 2 100 0 0 Dormant
Light & Power (UK) Limited 2 100 0 0 Dormant
Longfield Insurance Company 500,000 100 968 968 Insurance
Limited
Powercare Limited 2 100 0 0 Dormant
Premier Electricity Limited 2 100 0 0 Dormant
Premier Utilities Limited 2 100 0 0 Dormant
Seeb Limited 10,000 100 22 22 Investment Company
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1997.
<TABLE>
<CAPTION>
NUMBER
OF
COMMON % OF ISSUER OWNER'S
SHARES VOTING BOOK BOOK
NAME OF COMPANY OWNED POWER VALUE (1) VALUE (1) BUSINESS TYPE
(thousands) (thousands)
- -------------------------------------- ---------- ---------- ----------- ---------- ------------------------
<S> <C> <C> <C> <C> <C>
Seeboard (Consulting)Limited 2 100 0 0 Dormant
Seeboard (Distribution)Limited (44) 2 100 0 0 Dormant
Seeboard Employment 2 100 56 56 Employment Agency
Services Limited (45)
Seeboard Insurance Company 1,000,000 100 13,177 13,177 Insurance
Limited
Seeboard Final Salary
Pension Plan
Trustee Company Limited 2 100 0 0 Trustee Company
Seeboard International Limited 500,000 100 705 705 Overseas Consultancy
SEEBOARD Pension Investment
Plan Trustee Company Limited 2 100 0 0 Trustee Company
SEEBOARD Powerlink Limited 2 100 0 0 Dormant
Seeboard Share Scheme Trustees 2 100 0 0 Trustee Company
Limited
SEEBOARD Trading Limited 10,000,000 100 18,670 18,670 Retail and Contracting
Seepower Limited 10,000 100 (5,373) (5,373) Investment Company
Selectricity Limited 2 100 0 0 Dormant
South Coast Power Limited 2 50 0 0 Dormant
South Eastern Electricity 2 100 0 0 Dormant
Board Limited
South Eastern Electricity Limited 2 100 0 0 Dormant
South Eastern Services Limited 2 100 0 0 Dormant
South Eastern Utilities Limited 2 100 0 0 Dormant
Southern Gas Limited 500,000 100 (12,705) (12,705) Gas Supply
Torch Natural Gas Limited 2 100 0 0 Dormant
UK Data Collection Services 155,000 8.4 254,990 254,990 Data Collection Service
Limited
UK Electricity Limited 2 100 0 0 Dormant
UK Light and Power Limited 2 100 0 0 Dormant
CSW International Three, Inc.(CSWI3)(46) 1,000 100 Nominal Nominal Investment Company
CSW International (U.K), Inc. (47) See (47) See (47) See (47) See (47) Dormant
Energia Internacional de CSW, S.A. 50,000 100 120 120 Investment Company
de C.V. (48)
Aceltek, S. de R.L. de C.V. (49) See (49) 49.99 218 109 Holding Company
Enertek, S.A. de C.V. (50) 4,910 99.89 144 144 Mexican Cogen Facility
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1997.
<TABLE>
<CAPTION>
NUMBER
OF
COMMON % OF ISSUER OWNER'S
SHARES VOTING BOOK BOOK
NAME OF COMPANY OWNED POWER VALUE (1) VALUE (1) BUSINESS TYPE
(thousands) (thousands)
- -------------------------------------- ---------- ---------- ----------- ---------- ------------------------
<S> <C> <C> <C> <C> <C>
Cinergy, S. de R.L. de C.V.(51) See (51) 99.99 39 39 Service Company
Servicios Corporativos
Industriales del Noreste,
S.A. de C.V.(SCIN) (52) 8,380 94.38 150 142 Service Company
Servicios Industriales y
Administrativos del
Noreste, S. de R.L. de C.V.
(SIAN) (53) See(53) 51.12 3,339 1,707 Gas Pipeline Company
CSW International, Inc. (Cayman) (54) 1,000 100 80,050 80,050 International Activities
CSW Vale L.L.C. (Cayman) (55) 1,000 99 83,960 83,960 International Activities
Empresa de Electricidade Vale
de Paranapanema S.A. (56) 21,498,447 21.42 319,725 117,211 Brazilian Utility Co.
CSW Power do Brasil Ltda. (57) See (57) See (57) See (57) See (57) International Activities
S.C.E.L. Empreendimentos e
Participacoes Ltda. (58) See (58) See (58) See (58) See (58) International Activities
CSW Coelba L.L.C. (Cayman) (59) See (59) See (59) See (59) See (59) International Activities
Coelba Funding Company L.L.C.
(Cayman) (60) See (60) See (60) See (60) See (60) International Activities
Latin American Energy Holdings, Inc.(61) See (61) See (61) Nominal Nominal International Activities
Chile Energy Holdings L.L.C.(Cayman)(62) See (62) See (62) 526 526 International Activities
Sol Energia Holdings I, Limitada(63) See (63) See (63) See (63) See (63) International Activities
Sol Energia Holdings II,Limitada (64) See (64) See (64) See (64) See (64) International Activities
Sol Energia, Limitada (65) See (65) See (65) See (65) See (65) International Activities
CSW International Energy
Development Ltd. (66) See (66) See (66) Nominal Nominal International Activities
Tenaska CSW International Ltd.(67) See (67) See (67) See (67) See (67) International Activities
ENERSHOP INC. (ENERSHOP) 1,000 100 (4,339) (4,339) Energy Services
CSW ENERGY SERVICES, INC. (ESI)(68) 1,000 100 (964) (964) Energy Services
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(1) Table reflects investment in common stock or other equity securities only.
CSW has established a money pool to coordinate short-term borrowings for
certain subsidiaries and also incurs borrowings outside the money pool for
other subsidiaries through the issuance of its commercial paper as
authorized by SEC Order. Money pool balances are reflected as advances to or
from affiliates, which are included as cash and temporary cash investments
and short-term debt, respectively, on the balance sheets of System
companies.
(2) CSWC Southwest Holdings, Inc., a Delaware corporation, was organized on
December 6, 1996 and holds 100% of the outstanding shares of CSWC TeleChoice
Management, Inc. and 100% of CSWC TeleChoice, Inc. CSW Communications, Inc.
holds 100% of the outstanding shares of CSWC Southwest Holdings, Inc.
(3) CSWC TeleChoice Management, Inc., a Delaware corporation, was organized on
December 6, 1996 and holds 100% of the membership units of CSW/ICG ChoiceCom
Management, L.L.C. CSWC Southwest Holdings, Inc. holds 100% of the
outstanding shares of CSWC TeleChoice Management, Inc.
(4) CSW/ICG ChoiceCom Management, L.L.C., a Delaware limited liability company,
was organized on December 13, 1996 and holds a 1% general partnership
interest in CSW/ICG ChoiceCom, L.P. CSWC TeleChoice Management, Inc. holds
100% of the membership units of CSW/ICG ChoiceCom Management, L.L.C.
(5) CSWC TeleChoice, Inc., a Delaware corporation, was organized on December 6,
1996 and holds a 99% limited partership interest in CSW/ICG ChoiceCom, L.P.
CSWC Southwest Holdings, Inc. holds 100% of the outstanding shares of CSWC
TeleChoice, Inc.
(6) CSW/ICG ChoiceCom, L.P., a Delaware limited partnership, was organized on
December 13, 1996 to provide telephone and other communication services,
initially to Austin, Texas, Corpus Christi, Texas and Tulsa, Oklahoma. CSWC
TeleChoice, Inc. holds a 99% limited partnership interest and CSW/ICG
ChoiceCom Management, L.L.C., holds a 1% general partnership interest in
CSW/ICG ChoiceCom, L.P.
(7) Polk Power GP II, Inc., a Delaware corporation, was organized on March 20,
1995 and holds 100% of the outstanding shares of Polk Power GP, Inc. CSW
Development-I, Inc. holds 50% of the outstanding shares of Polk Power GP II,
Inc.
(8) Polk Power GP, Inc., a Delaware corporation, was organized on September 18,
1991 and holds a 1% general partnership interest in Polk Power Partners, L.
P. Polk Power GP II, Inc. holds 100% of the outstanding shares of Polk Power
GP, Inc.
(9) Orange Cogeneration GP II, Inc., a Delaware corporation, was organized on
March 16, 1995 and holds 100% of the outstanding shares of Orange
Cogeneration G.P., Inc. CSW Development-I, Inc. holds 50% of the outstanding
shares of Orange Cogeneration GP II, Inc.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(10)Orange Cogeneration GP, Inc., a Delaware corporation, was organized on
February 5, 1993 and holds a 1% general partnership interest in Orange
Cogeneration Limited Partnership. Orange Cogeneration GP II, Inc., holds
100% of the outstanding shares of Orange Cogeneration G.P., Inc.
(11)CSW Mulberry II, Inc., a Delaware corporation, was organized on March 21,
1995 and holds 100% of the outstanding shares of CSW Mulberry, Inc. CSW
Development-I, Inc. holds 100% of the outstanding shares of CSW Mulberry II,
Inc.
(12)CSW Mulberry, Inc., a Delaware corporation, was organized on February 3,
1994 and holds a 45.75% limited partnership interest in Polk Power Partners,
L. P. CSW Mulberry II, Inc. holds 100% of the outstanding shares of CSW
Mulberry, Inc.
(13)Polk Power Partners, L. P., a Delaware limited partnership, was organized on
February 20, 1992 to own and operate the Mulberry cogeneration project.
CSW Mulberry, Inc. holds a 45.75% limited partnership interest and Polk
Power GP, Inc. holds a 1% general partnership interest in Polk Power
Partners, L. P. Under the Limited Partnership Agreement for Polk Power
Partners, L. P., Polk Power GP, Inc. generally has the power and authority
to manage the affairs of Polk Power Partners, L. P. and CSW Mulberry, Inc.
has such rights and powers as are customary for a limited partner, including
but not limited to the right (in proportion to its interest) to consent to
major transactions.
(14)Noah I Power GP, Inc., a Delaware corporation, was organized on May 14,
1991 and holds a 1% general partner interest in Noah I Power Partners, L. P.
CSW Development-I, Inc. holds 100% of the outstanding shares of Noah I Power
GP, Inc.
(15)Noah I Power Partners, L. P., a Delaware limited partnership, was organized
on May 16, 1991 to own and/or operate cogeneration projects or interests
therein. CSW Development-I, Inc. holds a 94.5% limited partnership interest
and Noah I Power GP, Inc. holds a 1% general partnership interest in Noah I
Power Partners, L. P. Under the Limited Partnership Agreement for Noah I
Power Partners, L. P., Noah I Power GP, Inc. generally has the power and
authority to manage the affairs of Noah I Power Partners, L. P., and CSW
Development-I, Inc. has such rights and powers as are customary for a
limited partner, including but not limited to the right (in proportion to
its interest) to consent to certain major transactions.
(16)Brush Cogeneration Partners is a Delaware general partnership organized on
November 1, 1991. Noah I Power Partners, L. P. holds a 50% general
partnership interest in Brush Cogeneration Partners. Brush Cogeneration
Partners was formed to invest in certain cogeneration projects, including
the Brush II project authorized by SEC Order Rel. No. 35-25399. Brush
Cogeneration Partners is managed by a management committee, with Noah I
Power Partners, L. P. having the power and authority to manage the affairs
of Brush Cogeneration Partners.
(17)CSW Orange II, Inc., a Delaware corporation, was organized on March 16,
1995 and holds 100% of the outstanding shares of CSW Orange, Inc. CSW
Development-I, Inc. holds 100% of the outstanding shares of CSW Orange II,
Inc.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(18)CSW Orange, Inc., a Delaware corporation, was organized on April 21, 1993
to be a limited partner in Orange Cogeneration Limited Partnership. CSW
Orange, Inc. holds a 49.5% limited partnership interest in Orange
Cogeneration Limited Partnership. CSW Orange II, Inc. holds 100% of the
outstanding shares of CSW Orange, Inc.
(19)Orange Cogeneration Limited Partnership, a Delaware limited partnership,
was organized on February 5, 1993 to own and operate the Orange Cogeneration
project. CSW Orange, Inc. holds a 49.5% limited partnership interest and
Orange Cogeneration G.P., Inc. holds a 1% general partnership interest in
Orange Cogeneration Limited Partnership. Under the Limited Partnership
Agreement for Orange Cogeneration Limited Partnership, Orange Cogeneration
G.P., Inc. generally has the power and authority to manage the affairs of
Orange Cogeneration Limited Partnership and CSW Orange, Inc. has such rights
and powers as are customary for a limited partner, including but not limited
to the right (in proportion to its interest) to consent to major
transactions.
(20)Orange Cogen Funding Corp., a Delaware corporation, was organized on
December 23, 1996 to raise funds from the sale of bonds and loan the
proceeds to the Orange Cogeneration Limited Partnership while obtaining
liens on the partnership assets for the benefit of the bond Trustee. Orange
Cogeneration Limited Partnership holds 100% of the outstanding shares of
Orange Cogen Funding Corp.
(21)Thermo Cogeneration Partnership, L.P., a Delaware limited partnership, was
organized April 7, 1993 to own and operate the Ft. Lupton cogeneration
project. CSW Ft. Lupton, Inc. holds a 49% limited partnership interest and a
1% general partnership interest.
(22)Newgulf Power Venture, Inc., a Delaware corporation, was organized on
October 13, 1994 to own the Texas Gulf project. Newgulf Power Venture, Inc.
holds 100% of the Texas Gulf project. CSW Energy, Inc. holds 100% of the
outstanding shares of Newgulf Power Venture, Inc.
(23)CSW Sweeny GP I, Inc., a Delaware corporation, was organized on September
6, 1995 to hold a 100% interest in CSW Sweeny GP II, Inc. CSW Energy, Inc.
holds 100% of the outstanding shares of CSW Sweeny GP I, Inc.
(24)CSW Sweeny GP II, Inc., a Delaware corporation, was organized on September
6, 1995 and holds a 1% general partnership interest in Sweeny Cogeneration
Limited Partnership. CSW Sweeny GP I, Inc. holds 100% of the outstanding
shares of CSW Sweeny GP II, Inc.
(25)CSW Sweeny LP I, Inc., a Delaware corporation, was organized on September
6, 1995 and holds 100% of the outstanding stock of CSW Sweeny LP II, Inc.
CSW Energy, Inc. holds 100% of the outstanding shares of CSW Sweeny LP I,
Inc.
(26)CSW Sweeny LP II, Inc., a Delaware corporation, was organized on September
6, 1995 and holds a 49% limited partnership interest in Sweeny Cogeneration
Limited Partnership. CSW Sweeny LP I, Inc. holds 100% of the outstanding
shares of CSW Sweeny LP II, Inc.
(27)Sweeny Cogeneration Limited Partnership, a Delaware limited partnership,
was organized on September 15, 1995 to own and construct the Sweeny project.
CSW Sweeny LP II, Inc. holds a 49% limited partnership interest and CSW
Sweeny GP II, Inc. holds a 1% general partnership interest in Sweeny
Cogeneration Limited Partnership.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(28)CSW Development-3, Inc., a Delaware corporation, was organized on October
25, 1995. There were no assets or activity for CSW Development-3, Inc.,
during 1997. On December 15, 1995, CSW Development-3, Inc. was granted EWG
status. CSW Energy, Inc. holds 100% of the outstanding shares of CSW
Development-3, Inc.
(29)CSW Northwest GP, Inc., a Delaware corporation, was organized on June 29,
1995. There were no assets or activity for CSW Northwest GP, Inc. in 1997.
On October 3, 1996, CSW Northwest GP, Inc. was granted EWG status. CSW
Energy, Inc. holds 100% of the outstanding shares of CSW Northwest GP, Inc.
(30)CSW Northwest LP, Inc., a Delaware corporation, was organized on June 29,
1995. There were no assets or activity for CSW Northwest LP, Inc. in 1997.
On October 3, 1995, CSW Northwest LP, Inc. was granted EWG status. CSW
Energy, Inc. holds 100% of the outstanding shares of CSW Northwest LP, Inc.
(31)CSW Power Marketing, Inc., a Delaware corporation, was organized on March
8, 1996. There were no assets or activity for CSW Power Marketing, Inc. in
1997. On May 1, 1996 CSW Power Marketing, Inc. was granted EWG status. CSW
Energy, Inc. holds 100% of the outstanding shares of CSW Power Marketing,
Inc.
(32)CSW Nevada, Inc., a Delaware corporation, was organized on June 29, 1993.
There were no assets or activity for CSW Nevada, Inc. in 1997. CSW Energy,
Inc. holds 100% of the outstanding shares of CSW Nevada, Inc.
(33)CSW Services International, Inc. , a Delaware corporation, was organized on
March 19,1997. CSW Services International, Inc. provides non-regulated
services to power producers. CSW Energy, Inc. holds 100% of the outstanding
shares of CSW Services, International, Inc.
(34)Diversified Energy Contractors Company, LLC, a Delaware limited liability
company, was organized on July 3, 1997. CSW Energy, Inc. holds a 90%
interest and is the managing member of Diversified Energy Contractors
Company, LLC.
(35)DECCO II LLC, a Delaware limited liability company, was organized on August
8, 1997. Diversified Energy Contractors Company, LLC holds 100% of the
outstanding shares of DECCO II LLC.
(36)Diversified Energy Contractors, L.P., a Delaware limited partnership, was
organized on August 8, 1997. Diversified Energy Contractors Company, LLC
holds a 1% general partnership interest and a 98.00% limited partnership
interest and DECCO II LLC holds a 1% limited partnership interest.in
Diversified Energy Contractors, L.P.
(37)CSW International, Inc., a Delaware corporation, was organized on November
9, 1994. CSW International, Inc., was organized to pursue power generation,
transmission, and distribution projects outside of the United States. CSW
holds 100% of the outstanding shares of CSW International, Inc.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(38)CSW UK Finance Company, a private unlimited company having share capital,
with its registered office situated in the United Kingdom, was incorporated
on December 17, 1996. As of December 31, 1997, CSW UK Finance Company held
93% of CSW Investments. CSW International Two, Inc. holds a 90% interest and
CSW International Three holds a 10% interest in CSW UK Finance Company.
(39)CSW Investments, a private unlimited company having share capital, was
formed on November 3, 1995, and held 100% of CSW (UK) plc and holds 100% of
SEEBOARD Group plc. CSW Investments, a UK organized entity, was formed to
carry on business as a holding and investment company. As of December 31,
1997, CSW UK Finance Company held a 93% interest and CSW International
Three, Inc. held a 7% interest in CSW Investments.
(40)SEEBOARD Group plc, a public company limited by shares, was incorporated on
April 18, 1996, with its registered office situated in the United Kingdom.
SEEBOARD Group plc owns 100% of SEEBOARD plc, a UK utility company. CSW
Investments holds 100% of the shares of SEEBOARD Group plc.
(41)SEEBOARD plc's interest in SEEBOARD (Generation) Limited was transferred to
SEEBOARD Group plc effective January 1, 1997.
(42)SEEBOARD plc's interest in SEEBOARD Natural Gas Limited was transferred to
SEEBOARD Group, plc effective January 1, 1997.
(43)SEEBOARD plc, which is registered in Crawley, West Sussex, England, is a
public company limited by shares and came into existence as a result of the
restructuring and subsequent privatization of the United Kingdom electricity
industry in 1990. SEEBOARD plc's primary regulated businesses are the
distribution and supply of electricity within its southeast England service
area. SEEBOARD plc is also involved in other activities, including
electricity generation, electrical contracting and retailing. SEEBOARD Group
plc holds 100% of the shares of SEEBOARD plc.
(44)SEEBOARD (Distribution) Limited changed its name to Meterpoint Limited on
February 16, 1998.
(45)SEEBOARD (Property Development) Limited changed its name to SEEBOARD
Employment Services on April 2, 1997.
(46)CSW International Three, Inc., a Delaware corporation, was formed on
November 3, 1995 and holds a 10% ownership interest in CSW UK Finance
Company and a 7% ownership interest in CSW Investments. CSW International,
Inc. holds 100% of the shares of CSW International Three, Inc.
(47)CSW International (U.K.), Inc., a Delaware corporation, was formed on
September 14, 1995. CSW International, Inc. holds 100% of the outstanding
shares of CSW International (U.K.), Inc.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(48)Energia Internacional de CSW, S.A. de C.V., a Mexican variable capital
corporation, was organized on April 10, 1996 to acquire or participate in
the capital stock or patrimony of other civil or commercial operations. CSW
International, Inc. holds 99.99% of the outstanding shares of Energia
Internacional de CSW, S.A. de C.V.
(49)Aceltek, S. de R.L. de C.V., a Mexican limited liability partnership, was
organized in 1995 to act as a holding company for partnership interests.
Energia Internacional de CSW, S.A. de C.V. owns 49.99% of Aceltek, S. de
R.L. de C.V.
(50)Enertek, S.A. de C.V. , a Mexican variable capital corporation, was
organized in 1995. Aceltek, S. de R.L. de C.V. owns 99.89% of Enertek,
S.A. de C.V. with Energia Internacional de CSW, S.A. de C.V. holding an
additional 0.06% direct interest in Enertek, S.A. de C.V.
(51)Cinergy, S. de R.L. de C.V., a Mexican limited liability partnership, was
organized to act as a service company. Enertek, S.A. de C.V. owns
99.99% of Cinergy, S. de R.L. de C.V.
(52)Servicios Corporativos Industriales del Noreste, S.A. de C.V., a Mexican
variable capital corporation, was organized to act as a service company.
Enertek, S.A. de C.V. owns 94.38% of Servicios Corporativos Industriales del
Noreste, S.A. de C.V., with Aceltek, S. de R.L. de C.V. holding an
additional small direct interest in Servicios Corporativos Industriales del
Noreste, S.A. de C.V.
(53)Servicios Industriales y Administrativos del Noreste, S. de R.L. de C.V., a
Mexican limited liability partnership, was organized to own and operate
a gas pipeline. Enertek, S.A. de C.V. owns 51.12% of Servicios Industriales
y Administrativos del Noreste, S. de R.L. de C.V.
(54)CSW International, Inc. (Cayman), a Cayman Islands exempted company, was
duly organized under the laws of the Cayman Islands on July 7, 1995. CSW
International, Inc. holds 100% of the outstanding shares of CSW
International, Inc.
(Cayman).
(55)CSW Vale L.L.C., a Cayman Islands exempted company, was duly organized
under the laws of the Cayman Islands on October 21, 1996. CSW International,
Inc. (Cayman) holds approximately 99% of the outstanding shares of CSW Vale
L.L.C., with CSW International, Inc. holding the remaining 1%.
(56)Empresa de Eletricidade Vale Paranapanema S.A. is a Brazilian distribution
utility company. CSW Vale L.L.C. holds 21.42% of the outstanding shares of
Vale's common stock and 100% of Vale's Series "B" preferred stock.
(57)CSW Power do Brasil Ltda., a Brazilian limited liability company, was
organized on July 22, 1997. CSW Vale L.L.C. holds approximately 99.9% of CSW
Power do Brazil Ltda. with CSW International, Inc. (Cayman) holding the
remaining 0.1%.
(58)S.C.E.L. Empreendimentos e Participacoes Ltda. , a Brazilian limited
liability company, was acquired on November 3, 1997. CSW Vale L.L.C. holds
approximately 98.8% of S.C.E.L.. Empreendimentos e Participacoes Ltda. with
CSW International, Inc. (Cayman) holding the remaining 1.2%.
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS. (CONTINUED)
(59)CSW Coelba L.L.C. , a Cayman Islands exempted company, was duly organized
under the laws of the Cayman Islands on July 11, 1997. CSW International,
Inc. holds 100% of the outstanding shares of CSW Coelba L.L.C.
(60)Coelba Funding Company L.L.C. , a Cayman Islands exempted company, was duly
organized under the laws of the Cayman Islands on August 5, 1997. CSW Coelba
L.L.C. holds 50% of the outstanding shares of Coelba Funding Company L.L.C.
and Empresa de Eletricidade Vale Paranapanema S.A. holds the remaining 50%.
(61)Latin American Energy Holdings, Inc., a Delaware corporation, was organized
on August 22, 1997. There were no assets or activity for Latin American
Energy Holdings, Inc. for 1997. CSW International, Inc. holds 100% of all
outstanding shares of Latin American Energy Holdings, Inc.
(62)Chile Energy Holdings L.L.C., a Cayman Islands exempted company, was
organized on August 22, 1997. CSW International, Inc. holds 90% of all
outstanding shares of Chile Energy Holdings L.L.C. and Latin American Energy
Holdings, Inc. holds the remaining 10%.
(63)Sol Energia Holdings I, Limitada, a Chile exempted company, was organized
on August 29, 1997. There were no assets or activity for Sol Energia
Holdings I, Limitada in 1997. Chile Energy Holdings L.L.C. holds 99.99% of
all outstanding shares of Sol Energia Holdings I, Limitada and Latin
American Energy Holdings, Inc. holds the remaining 0.01%.
(64)Sol Energia Holdings II, Limitada, a Chile exempted company, was organized
on September 23, 1997. There were no assets or activity for Sol Energia
Holdings II, Limitada in 1997. Sol Energia Holdings I, Limitada holds 99.99%
of all outstanding shares of Sol Energia Holdings II, Limitada and Latin
American Energy Holdings, Inc. holds the remaining 0.01%.
(65)Sol Energia, Limitada, a Chile exempted company, was organized on October
8, 1997. There were no assets or activity for Sol Energia, Limitada in 1997.
Sol Energia Holdings II, Limitada holds 99.99% of all outstanding shares of
Sol Energia, Limitada and Latin American Energy Holdings, Inc.
holds the remaining 0.01%.
(66)CSW International Energy Development Ltd., a private company limited by
shares, was incorporated on April 3, 1997 with its registered office
situated in Port Louis, Mauritius. CSW International, Inc. holds 100% of all
outstanding shares of CSW International Energy Development Ltd.
(67)Tenaska CSW International Ltd., a private company limited by shares, was
incorporated on April 3, 1997 with its registered office situated in Port
Louis , Mauritius. CSW International Energy Development Ltd. holds 50% of
the outstanding shares of Tenaska CSW International Ltd.
(68)CSW Energy Services, Inc. (ESI), a Delaware Corporation, was organized on
September 24, 1997. ESI seeks to secure electricity supply business in
states which soon will permit retail competition. CSW Corporation owns 100%
of the outstanding shares of ESI.
<PAGE>
ITEM 2. ACQUISITIONS OR SALES OF UTILITY ASSETS.
During 1997, all acquisitions or sales of utility assets were reported in a
certificate filed pursuant to Rule 24.
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES.
During 1997 all System securities issued, sold, pledged, guaranteed or assumed
by any System company, were reported in a certificate filed pursuant to Rule 24.
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES.
The following System securities were acquired, redeemed or retired by System
companies during 1997.
EXTINGUISHED (E) COMMISSION
OR HELD FOR AUTHORIZATION
NAME OF ISSUER AND CONSIDERATION FURTHER OR
TITLE OF ISSUE (thousands) DISPOSITION(D) EXEMPTION
- --------------------------------------------------------------------------------
CPL
First Mortgage Bonds
Series BB, 6.0%,due 1997 $200 E No authorization required
(Retired at maturity)
Preferred Stock
4.00% 3,992 E Rule 42
4.02% 4,431 E Rule 42
7.12% 25,867 E Rule 42
8.72% 50,454 E Rule 42
PSO
Preferred Stock
4.00% 3,525 E Rule 42 and Oklahoma Corp
Commission
4.24% 6,804 E Rule 42 and Oklahoma Corp
Commission
SWEPCO
First Mortgage Bonds
Series 1976A,
6.2%, due 2006 145 E Rule 42
Preferred Stock
5.00% 3,049 E Rule 42
4.65% 1,839 E Rule 42
4.28% 3,961 E Rule 42
6.95% Subject to
mandatory redemption 7,194 E Rule 42
WTU
Preferred Stock
4.40% 3,632 E Rule 42
<PAGE>
ITEM 5. INVESTMENTS IN SECURITIES OF NON-SYSTEM COMPANIES.
(1). Aggregate number of investments in persons operating in the retail service
areas.
CARRYING
GENERAL DESCRIPTION AGGREGATE VALUE
OF TYPE
OF "PERSONS INCLUDED" NUMBER (thousands)
- ---------------------------------------------------------
NONE
(2). For securities not included in (1) above, provide the following:
% OF OWNERS
DESCRIPTION NUMBER VOTING BOOK
NAME OF ISSUER OF SECURITY OF POWER VALUE NATURE OF ISSUER'S
SHARES (THOUSANDS) BUSINESS
- -----------------------------------------------------------------------------
PSO
THE RIKA COMPANIES
RIKA Management Membership The RIKA Companies
Company,L.L.C. Units 50 4% $2,246 are engaged in the
development and
commercialization
of computer automation
Universal Power Membership technology for the
Products Company, Units 48 4% $(127) electric power
L.L.C. industry.
Automated Membership
Substation Units 71 4% $(61)
Development
Co., L.L.C.
RC Training, Membership
L.L.C. Units 48 4% $0
<PAGE>
ITEM 5. INVESTMENTS IN SECURITIES OF NON-SYSTEM COMPANIES. (CONTINUED)
(2). For securities not included in (1) above, provide the following:
OWNERS
DESCRIPTION NUMBER % OF BOOK
NAME OF ISSUER OF OF VOTING VALUE NATURE OF ISSUER'S
SECURITY SHARES POWER (THOUSANDS) BUSINESS
- --------------------------------------------------------------------------------
PSO (CONTINUED)
Excel Energy Class A, Excel Energy
Technologies, Inc. voting, 4 0.0% $0 Technologies is
common engaged in
stock research,
development and
installation
Class B, of proprietary,
nonvoting, micro-processor
common 648 NA $0 based energy
stock control technology.
Preferred,
Series C, 590 3.3% $0
voting
Preferred,
Series E,
nonvoting 12,459 NA $0
Preferred,
Series F,
nonvoting 1,749 NA $0
Nuvest, L.L.C. Membership Nuvest L.L.C.
Units 700 4.9% $3,641 provides staffing
services for
electric utility
power plants.
<PAGE>
ITEM 5. INVESTMENTS IN SECURITIES OF NON-SYSTEM COMPANIES. (CONTINUED)
(2). For securities not included in (1) above, provide the following:
OWNERS
DESCRIPTION NUMBER % OF BOOK
NAME OF ISSUER OF OF VOTING VALUE NATURE OF ISSUER'S
SECURITY SHARES POWER (THOUSANDS) BUSINESS
- --------------------------------------------------------------------------------
PSO (CONTINUED)
Scientech, Inc. Class A, Services, systems,
voting 70,000 3.5% $3,307 and instruments,
common which describe,
stock regulate, monitor,
and
Class B, enhance the safety
non-voting and reliability of
common 436,000 N/A $0 electric utility
stock power plant
operations and
and their
environmental
impacts
Powerware Preferred Municipal water,
Solutions, Inc. Series A, 18,333 4.0% $1,325 electric
voting optimization
software company
Nonvoting 168,214 N/A $0
Utility Data Convertible Provides utility
Resources, Inc. Preferred outsourcing of
Stock 7,500 N/A $2,703 large customer
nonvoting time
differentiated
meter reading
and billing
Common
Stock 17,500 4.5% $0
voting
Nonvoting 252,500 N/A $0
AEMT, Inc. Preferred Manufactures and
Stock sells residential
Series 1, surge protectors
Class A 250,000 N/A $250 and power quality
nonvoting devices for
industrial
customers
<PAGE>
ITEM 5. INVESTMENTS IN SECURITIES OF NON-SYSTEM COMPANIES. (CONTINUED)
(2). For securities not included in (1) above, provide the following:
OWNERS
DESCRIPTION NUMBER % OF BOOK
NAME OF ISSUER OF OF VOTING VALUE NATURE OF ISSUER'S
SECURITY SHARES POWER (THOUSANDS) BUSINESS
- --------------------------------------------------------------------------------
PSO (CONTINUED)
AEMT, Inc. Preferred Manufactures and
Stock sells residential
Series 1 surge protectors
Class B 781,250 N/A $1,250 and power quality
nonvoting devices for
industrial
customers
SEEBOARD PLC
`
Electricity Common 20,000 4.9% $32,902 Trustee Company
Pensions Trustee Stock
Limited
ESN Holdings Common 104 4.9% $171 Trustee Company
Limited Stock
Preference 50,000 N/A $82,255
Shares
EA Technology Preference 362,500 N/A $569,349 Research
Limited Shares
COMM
Brooks Fiber Common 121,200 N/A $3,090,600 Local
Properties, Stock telecommunication
Inc. services
Infinitec Conv. 420,001 N/A $500,000 Local
Communications Pref. telecommunication
Series A services
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I.
The positions of officers and directors of all System companies as of December
31, 1997 were as follows.
NAME AND ADDRESS POSITION
CENTRAL AND SOUTH WEST CORPORATION
Glenn Biggs (1) San Antonio, TX D
Molly Shi Boren Norman, OK D
E. R. Brooks Dallas, TX D,CM,&CEO
Donald M. Carlton Austin, TX D
Lawrence B. Connors Dallas, TX C
T. J. Ellis Crawley, West D
Sussex, UK
Glenn Files (2) Dallas, TX D&EVP
Joe H. Foy Kerrville, TX D
T. M. Hagan Dallas, TX SVP
Wendy G. Hargus Dallas, TX T
William R. Howell Dallas, TX D
Robert W. Lawless Tulsa, OK D
Venita McCellon-Allen Dallas, TX SVP&AS
Stephen J. McDonnell Dallas, TX VP
Ferd. C. Meyer, Jr. Dallas, TX SVP&GC
James L. Powell Fort McKavett, TX D
Kenneth C. Raney, Jr. Dallas, TX VP,AGC&S
Glenn D. Rosilier Dallas, TX SVP&CFO
Richard L. Sandor Chicago, IL D
Thomas V. Shockley, III Dallas, TX D,P,&COO
Lloyd D. Ward (3) Newton, Iowa D
(1) Mr. Biggs resigned from the CSW Board of Directors on March 18, 1998. (2)
Mr. Files resigned from the CSW Board of Directors on January 21, 1998. (3) Mr.
Ward resigned from the CSW Board of Directors on January 1, 1998.
CENTRAL POWER AND LIGHT COMPANY
John F. Brimberry Victoria, TX D
E. R. Brooks Dallas, TX D
Alice G. Crisp Corpus Christi, TX AS
R. Russell Davis Tulsa, OK C
M. Bruce Evans (1) Corpus Christi, TX D&P
Glenn Files Dallas, TX D
Ruben M. Garcia Laredo, TX D
Wendy G. Hargus Dallas, TX T
Nancy C. Johnson Corpus Christi, TX AS
Robert A. McAllen Weslaco, TX D
Pete J. Morales, Jr. Devine, TX D
H. Lee Richards Harlingen, TX D
J. Gonzalo Sandoval (2) Corpus Christi, TX D&GM
Brenda J. Snider Corpus Christi, TX S
Jana P. Soward Tulsa, OK AT
Gerald E. Vaughn Corpus Christi, TX D
(1) Mr. Evans resigned from the CPL Board of Directors and as President of CPL,
February 1998. (2) Mr. Sandoval became General Manager/President of CPL,
February 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
PUBLIC SERVICE COMPANY OF OKLAHOMA
E. R. Brooks Dallas, TX D
Billye R. Beach Tulsa, OK AS
T. D. Churchwell Tulsa, OK D&P
Harry A. Clarke Afton, OK D
R. Russell Davis Tulsa, OK C
Glenn Files Dallas, TX D
Wendy G. Hargus Dallas, TX T
Lina P. Holm Tulsa, OK S
Paul K. Lackey, Jr. Oklahoma City, OK D
Paula Marshall-Chapman Tulsa, OK D
William R. McKamey Tulsa, OK D&GM
Jana P. Soward Tulsa, OK AT
Robert B. Taylor, Jr. Okmulgee, OK D
ASH CREEK MINING COMPANY
T. D. Churchwell Tulsa, OK D
Kit Hill Tulsa, OK S&T
Lina P. Holm Tulsa, OK AS&AT
William R. McKamey Tulsa, OK D
E. Michael Williams Tulsa, OK P&D
Lori A. Wright Tulsa, OK CMPT
Robert L. Zemanek Tulsa, OK D,CM&CEO
Waldo J. Zerger, Jr. Tulsa, OK D
SOUTHWESTERN ELECTRIC POWER COMPANY
E. R. Brooks Dallas, TX D
Judith W. Culver Shreveport, LA AS
R. Russell Davis Tulsa, OK C
James E. Davison Ruston, LA D
Glenn Files Dallas, TX D
Wendy G. Hargus Dallas, TX T
Dr. Fredrick E. Joyce Texarkana, TX D
Marilyn S. Kirkland Shreveport, LA S
John M. Lewis Fayetteville, AR D
Karen C. Martin Shreveport, LA D&GM
William C. Peatross Shreveport, LA D
Maxine P. Sarpy Shreveport, LA D
Michael D. Smith (1) Shreveport, LA D&P
Jana P. Soward Tulsa, OK AT
(1) Mr. Smith resigned from the SWEPCO Board of Directors and as President of
SWEPCO, April 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
THE ARKLAHOMA CORPORATION
John W. Harbour, Jr. Oklahoma City, OK D&P
E. Bennie Daigle, Jr. New Orleans, LA D&VP
Preston Kissman Tulsa, OK D
D. J. Rich Oklahoma City, OK D,S&T
SOUTHWEST ARKANSAS UTILITIES COMPANY
Charles E. Clinehens, Jr. Fayetteville, AR D,S&T
Thomas H. DeWeese Fayetteville, AR D&P
Elizabeth D. Stephens Texarkana, TX D&VP
WEST TEXAS UTILITIES COMPANY
Jeff C. Broad Abilene, TX AS
E. R. Brooks Dallas, TX D
Paul J. Brower (1) Abilene, TX D&GM
R. Russell Davis Tulsa, OK C
Glenn Files Dallas, TX D
Wendy G. Hargus Dallas, TX T
Tommy Morris Abilene, TX D
Martha Murray Abilene, TX S
Floyd W. Nickerson (2) Abilene, TX D&P
Dian G. Owen Abilene, TX D
James M. Parker Abilene, TX D
Jana P. Soward Tulsa, OK AT
F. L. Stephens San Angelo, TX D
(1) Mr. Brower became General Manager/President of WTU, January 1998.
(2) Mr. Nickerson resigned from the WTU Board of Directors and as President of
WTU, January 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CENTRAL AND SOUTH WEST SERVICES, INC.
Richard H. Bremer (1) Dallas, TX P
E. R. Brooks Dallas, TX D,CH&CEO
T. D. Churchwell Tulsa, OK D
R. Russell Davis Tulsa, OK C
Leslie E. Dillahunty Dallas, TX VP
M. Bruce Evans Corpus Christi, TX D
Glenn Files Dallas, TX D
A. Dean Fuller Dallas, TX VP
T. M. Hagan Dallas, TX D&SVP
Wendy G. Hargus Dallas, TX T
Lana Hillebrand Dallas, TX VP
Preston Kissman Tulsa, OK VP
Venita McCellon-Allen Dallas, TX D,SVP&AS
Ferd. C. Meyer, Jr. Dallas, TX D
Floyd W. Nickerson Abilene, TX D
Kenneth C. Raney, Jr. Dallas, TX S
Mark Roberson Dallas, TX VP
Glenn D. Rosilier Dallas, TX D
John Saenz (2) Tulsa, OK VP
Thomas V. Shockley, III Dallas, TX D
Michael D. Smith Shreveport, LA D
Jana P. Soward Tulsa, OK AT
Gerald E. Vaughn Corpus Christi, TX VP
Richard P. Verret (3) Dallas, TX P
E. Michael Williams Dallas, TX VP
Lori A. Wright Tulsa, OK AC
Waldo Zerger Tulsa, OK VP
Robert L. Zemanek (4) Dallas, TX P
(1) Mr. Bremer is President of Central and South West Services, Inc. -- Energy
Services.
(2) Mr. Saenz left the company in February, 1998.
(3) Mr. Verret is President of Central and South West Services, Inc. -- Power
Generation.
(4) Mr. Zemanek is President of Central and South West Services, Inc. --
Energy Delivery.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW LEASING, INC.
E. R. Brooks Dallas, TX D&CH
Kenneth I. Brown New York, NY SVP
Lawrence B. Connors Dallas, TX C
Glenn Files Dallas, TX VP
Ira Finkelson New York, NY AS
Barbara Galaini New York, NY AC
Wendy G. Hargus Dallas, TX T
C. Jeffrey Knittle New York, NY SVP
Ferd. C. Meyer, Jr. Dallas, TX D,VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D&P
Leo Sheer New York, NY AS
Thomas V. Shockley, III Dallas, TX D,VP
Jean B. Stein New York, NY SVP
Nikita Zdanow New York, NY D
CSW CREDIT, INC.
E. R. Brooks Dallas, TX D&CH
Lawrence B. Connors Dallas, TX C
Glenn Files Dallas, TX D
T. M. Hagan Dallas, TX D
Wendy G. Hargus Dallas, TX VP
Venita McCellon-Allen Dallas, TX D&AS
Ferd. C. Meyer, Jr. Dallas, TX D
Stacy Newman Corrie Dallas, TX AT
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D&P
Thomas V. Shockley, III Dallas, TX D
Stephen D. Wise Dallas, TX T
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW COMMUNICATIONS, INC. (1)
Michael L. Babin Austin, TX GM
Richard H. Bremer Dallas, TX D
E. R. Brooks Dallas, TX D
Lawrence B. Connors Dallas, TX C
Glenn Files Dallas, TX D
T. M. Hagan Dallas, TX D
Wendy G. Hargus Dallas, TX T
Venita McCellon-Allen Dallas, TX D
Ferd. C. Meyer, Jr. Dallas, TX D
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D
Donald A. Shahan (2) Austin, TX D&P
Thomas V. Shockley, III Dallas, TX D
Jana P. Soward Tulsa, OK AT
(1) Effective March 11, 1998, CSW Communications, Inc. was renamed C3
Communictions, Inc. (2) Donald A. Shahan resigned in February, 1998.
CSWC SOUTHWEST HOLDINGS, INC.
Michael L. Babin Austin, TX VP&S
Donald A. Shahan (1) Austin, TX D&P
(1) Donald A. Shahan resigned in February, 1998.
CSWC TELECHOICE MANAGEMENT, INC.
Michael L. Babin Austin, TX VP&S
Donald A. Shahan (1) Austin, TX D&P
(1) Donald A. Shahan resigned in February, 1998.
CSW/ICG CHOICECOM MANAGEMENT, L.L.C.
Michael L. Babin Austin, TX D
Carey M. Balzer Austin, TX P
Henry R. Carabelli Englewood, CO D
John R. Gilliland Austin, TX VP
Wendy G. Hargus Dallas, TX T
Nancy R. Hayes Austin, TX VP&CFO&S
Sheldon S. Ohringer Englewood, CA D
Terrell Poth Austin, TX VP&AS
Donald A. Shahan (1) Austin, TX D
(1) Donald A. Shahan resigned in February, 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSWC TELECHOICE, INC.
Michael L. Babin Austin, TX VP&S
Donald A. Shahan (1) Austin, TX D&P
(1) Donald A. Shahan resigned in February, 1998.
CSW ENERGY, INC.
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX C
E. R. Brooks Dallas, TX D&CM
Stacy Newman Corrie Dallas, TX AT
Terry D. Dennis Dallas, TX D,P&CEO
Glenn Files Dallas, TX D
Paul E. Graf Dallas, TX VP
T. M. Hagan Dallas, TX D
Wendy G. Hargus Dallas, TX T
Alphonso R. Jackson (1) Dallas, TX VP
Venita McCellon-Allen Dallas, TX D
Ferd. C. Meyer, Jr. Dallas, TX D
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&VCM
Stephen D. Wise Dallas, TX AT
(1) Mr. Jackson accepted a position with CSW Corporation and resigned from CSW
Energy.
CSW DEVELOPMENT-I, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P & CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Eddie D. Peebles Dallas, TX C
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
POLK POWER GP II, INC.
Lee D. Atkins Dallas, TX D
J. S. Brown Houston, TX CFO
J.R. Cunningham Dallas, TX D&CEO
W. S. Garrett Houston, TX D
Michael T. Moran Dallas, TX D&P
Philip T. Schnorbach Dallas, TX S
D.L. Siddall Houston, TX AS
A. Wade Smith Lakeland, FL GM
POLK POWER GP, INC.
Lee D. Atkins Dallas, TX D
J. S. Brown Houston, TX CFO
J.R. Cunningham Houston, TX D&CEO
W. S. Garrett Houston, TX D
Michael T. Moran Dallas, TX D&P
Philip T. Schnorbach Dallas, TX S
D.L. Siddall Houston, TX AS
A. Wade Smith Lakeland, FL GM
ORANGE COGENERATION GP II, INC.
Lee D. Atkins Dallas, TX D
J. S. Brown Houston, TX CFO
J.R. Cunningham Houston, TX D&P
W. S. Garrett Houston, TX D
Michael T. Moran Dallas, TX D & CEO
Philip T. Schnorbach Dallas, TX AS
D.L. Siddall Houston, TX S
A. Wade Smith Lakeland, FL GM
ORANGE COGENERATION G.P., INC.
Lee D. Atkins Dallas, TX D
J. S. Brown Houston, TX CFO
J.R. Cunningham Houston, TX D&P
W. S. Garrett Houston, TX D
Michael T. Moran Dallas, TX D&CEO
Philip T. Schnorbach Dallas, TX AS
D.L. Siddall Houston, TX S
A. Wade Smith Lakeland, FL GM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW MULBERRY II, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
CSW MULBERRY, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
NOAH I POWER GP, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
CSW ORANGE II, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW ORANGE, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
ORANGE COGEN FUNDING CORP.
Lee D. Atkins Dallas, TX D
J.S. Brown Houston, TX CFO
J.R. Cunningham Houston, TX D & P
W.S. Garrett Houston, TX D
Michael T. Moran Dallas, TX D & CEO
Philip T. Schnorbach Dallas, TX S
D.L. Siddall Houston, TX AS
A. Wade Smith Lakeland, FL GM
CSW DEVELOPMENT-II, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Eddie D. Peebles Dallas, TX C
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
CSW FT. LUPTON, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
NEWGULF POWER VENTURE, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
CSW SWEENY GP I, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
CSW SWEENY GP II, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
CSW SWEENY LP I, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW SWEENY LP II, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
CSW DEVELOPMENT-3, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Eddie D. Peebles Dallas,TX C
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
CSW NORTHWEST GP, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
CSW NORTHWEST LP, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&CM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW POWER MARKETING, INC.
Terry D. Dennis Dallas, TX D,P&CEO
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Thomas V. Shockley, III Dallas, TX D&CM
CSW NEVADA, INC.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX D&VP
Wendy G. Hargus Dallas, TX T
Michael T. Moran Dallas, TX D&VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D
CSW SERVICES INTERNATIONAL, INC.
Lee D. Atkins Dallas, TX D & VP
Sandra S. Bennett Dallas, TX C
Terry D. Dennis Dallas, TX D,P & CEO
Paul E. Graf Dallas, TX D & VP
Wendy G. Hargus Dallas, TX T
Alphonso R. Jackson Dallas, TX D & VP
Michael T. Moran Dallas, TX D & VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D & CM
DIVERSIFIED ENERGY CONTRACTORS COMPANY, LLC
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX T
D.L. Butynski Dallas, TX P
Terry D. Dennis Dallas, TX CEO
Paul E. Graf Dallas, TX VP
Alphonso R. Jackson Dallas, TX VP
Michael T. Moran Dallas, TX VP
Philip T. Schnorbach Dallas, TX S
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
DECCO II LLC
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX VP
D.L. Butynski Dallas, TX P
Terry D. Dennis Dallas, Tx CEO
Paul E. Graf Dallas, TX VP
Alphonso R. Jackson Dallas, TX VP
Michael T. Moran Dallas, TX VP
Philip T. Schnorbach Dallas, TX VP
CSW INTERNATIONAL, INC.
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX C
E. R. Brooks Dallas, TX D&CM
Stacy Newman Corrie Dallas, TX AT
Terry D. Dennis Dallas, TX D,P&CEO
Glenn Files Dallas, TX D
Paul E. Graf Dallas, TX VP
T. M. Hagan Dallas, TX D
Wendy G. Hargus Dallas, TX T
Alphonso R. Jackson (1) Dallas, TX VP
Venita McCellon-Allen Dallas, TX D
Steve McDonnell Dallas, TX VP
Ferd. C. Meyer, Jr. Dallas, TX D
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&VCM
Steve D. Wise Dallas, TX AT
(1) Mr. Jackson accepted a position with CSW Corporation and resigned from CSW
International, Inc.
CSW INTERNATIONAL TWO, INC.
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX C
E. R. Brooks Dallas, TX CM
Terry D. Dennis Dallas, TX P&CEO
Paul E. Graf Dallas, TX VP
Wendy G. Hargus Dallas, TX T
Ferd. C. Meyer, Jr. Dallas, TX VP&GC
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX VP
Thomas V. Shockley, III Dallas, TX VCM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW UK FINANCE COMPANY
T. J. Ellis Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
G. D. Rosilier Dallas, TX D
Thomas V. Shockley, III Dallas, TX D&CM
CSW INVESTMENTS
T. J. Ellis Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West CFO
Sussex, UK
G. D. Rosilier Dallas, TX D
Thomas V. Shockley, III Dallas, TX D&CM
SEEBOARD GROUP PLC
E. R. Brooks Dallas, TX D
T. J. Ellis Crawley, West D&CM
Sussex, UK
M. H. Madison Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
Thomas V. Shockley, III Dallas, TX D
A. R. Smith (1) Crawley, West D
Sussex, UK
J. Weight Crawley, West D
Sussex, UK
(1) A.R. Smith resigned in January 1998.
SEEBOARD (GENERATION) LIMITED
T. J. Ellis Crawley, West CM
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (1) Crawley, West D
Sussex, UK
J. Weight Crawley, West D
Sussex, UK
(1) A.R. Smith resigned in January 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
MEDWAY POWER LIMITED
C. J. Daniels Crawley, West D
Sussex, UK
M. Fitzpatrick Richmond, Surrey, D
UK
J. Hart Maidenhead, D
Berkshire, UK
S. Matthews Maidenhead, D
Berkshire, UK
R. A. Page (1) Hove, East Sussex, D
UK
R. C. Sansom (1) Crawley, West D
Sussex, UK
B. Smith Maidenhead, D
Berkshire, UK
P. Stinson Isle of Grain, D
Kent, UK
S. Vassileou Isle of Grain, S
Kent, UK
(1) R. A. Page and R.C. Sansom resigned in February 1998 when H.C. Cadoux-Hudson
and J.E. Tame were appointed.
SEEBOARD NATURAL GAS LIMITED
T. J. Ellis Crawley, West D
Sussex, UK
S. Gutteridge Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West D&S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (1) Crawley, West D
Sussex, UK
J. Weight Crawley, West D
Sussex, UK
(1) A.R. Smith resigned in January 1998.
BEACON GAS LIMITED
M. J. Ambrose London, UK D
R. Johnston London, UK D
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
SEEBOARD PLC
H. Cadoux-Hudson Crawley, West C
Sussex, UK
T. J. Ellis Crawley, West D,CM & CEO
Sussex, UK
M. A. Nagle Crawley, West S&GC
Sussex, UK
M. J. Pavia Crawley, West D&CFO
Sussex, UK
P. J. Privett Crawley, West DCS
Sussex, UK
A. R. Smith (1) Crawley, West MD
Sussex, UK
J. Weight Crawley, West MD&COO
Sussex, UK
(1) A.R. Smith resigned in January 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
APPLIANCE PROTECT LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
DIRECT POWER LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
DIRECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
ELECTRICITY (UK) LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
ELECTRICITY 2000 LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
ENERGY EXPRESS LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
FIRST ELECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
FIRST GAS LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
GAS 2000 LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
HOME ELECTRICITY COMPANY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
HOME ENERGY COMPANY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
HOME GAS COMPANY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
HOME POWER COMPANY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
HORIZON NATURAL GAS LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
LIGHT & POWER (UK) LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
LONGFIELD INSURANCE COMPANY LIMITED
H. C. Arnold Douglas, Isle of D
Man, UK
R. J. Jackson Crawley, West D
Sussex, UK
M. A. G. Linck Douglas, Isle of CM
Man, UK
M. J. Pavia Crawley, West D
Sussex, UK
G. Stuart Douglas, Isle of D
Man, UK
POWERCARE LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
PREMIER ELECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
PREMIER UTILITIES LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SEEB LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SEEBOARD (CONSULTING) LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SEEBOARD (DISTRIBUTION) LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SEEBOARD EMPLOYMENT SERVICES LIMITED (1)
T. J. Ellis Crawley, West D&CM
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (2) Crawley, West D
Sussex, UK
J. Weight Crawley, West D
Sussex, UK
(1) SEEBOARD Employment Services Limited changed its name from SEEBOARD
(Property Development) Limited on 2 April 1998.
(2) A.R. Smith resigned in January 1998.
SEEBOARD INSURANCE COMPANY LIMITED
H. C. Arnold Douglas, Isle of D
Man, UK
M. A. G. Linck Douglas, Isle of CM
Man, UK
M. A. Nagle Crawley, West D
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
G. Stuart Douglas, Isle of D
Man, UK
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
SEEBOARD FINAL SALARY PENSION PLAN TRUSTEE COMPANY LIMITED
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (1) Crawley, West CM
Sussex, UK
A. M. Watts Crawley, West D&S
Sussex, UK
(1) A.R. Smith resigned in January 1998.
SEEBOARD INTERNATIONAL LIMITED
J. Croxford Crawley, West D
Sussex, UK
A. J. K. Goodwin Crawley, West D
Sussex, UK
P. S. Hofman Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
J. Weight Crawley, West CM
Sussex, UK
SEEBOARD PENSION INVESTMENT PLAN TRUSTEE COMPANY LIMITED
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (1) Crawley, West CM
Sussex, UK
A. M. Watts Crawley, West D&S
Sussex, UK
(1) A.R. Smith resigned in January 1998.
SEEBOARD POWERLINK LIMITED
P. S. Hofman (2) Crawley, West D
Sussex, UK
M. A. Nagle (1) Crawley, West S
Sussex, UK
J. Weight (2) Crawley, West D
Sussex, UK
(1) M. A. Nagle resigned as Director in July 1997 when he was appointed
Company Secretary.
(2) P.S. Hofman and J. Weight were appointed Directors in July 1997.
SEEBOARD SHARE SCHEME TRUSTEES LIMITED
M. A. Nagle Crawley, West D&S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
SEEBOARD TRADING LIMITED
T. J. Ellis Crawley, West D&CM
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
A. R. Smith (1) Crawley, West D
Sussex, UK
J. Weight Crawley, West D
Sussex, UK
(1) A.R. Smith resigned in January 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
SEEPOWER LIMITED
M. A. Nagle (1) Crawley, West S
Sussex, UK
M. J. Pavia (2) Crawley, West D
Sussex, UK
J. Weight (2) Crawley, West D
Sussex, UK
(1) M. A. Nagle resigned as Director and was appointed Secretary in February
1997.
(2) M. J. Pavia and J. Weight were appointed Directors in February 1997.
SELECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SOUTH COAST POWER LIMITED
P. E. Graf (1) Dallas, Texas D
E. Kolodziej Jr. (1) Dallas, Texas D
S. J. Lawrie (2) Glasgow, UK S
M. J. Ruston (3) Glasgow, UK D
K. L. Vowles (3) Glasgow, UK D
(1) P. E. Graf and E. Kolodziej Jnr were appointed Directors in August 1997.
(2) S. J. Lawrie was appointed Company Secretary in May 1997.
(3) M. J. Ruston and K. L. Vowles were appointed Directors in June 1997
SOUTH EASTERN ELECTRICITY BOARD LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SOUTH EASTERN ELECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SOUTH EASTERN SERVICES LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
SOUTH EASTERN UTILITIES LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
SOUTHERN GAS LIMITED
R. A. Danes (1) Crawley, West D
Sussex, UK
M. A. Nagle Crawley, West S
Sussex, UK
M. J. Pavia Crawley, West D
Sussex, UK
(1) R. A. Danes was appointed Director in October 1997 and resigned in February
1998.
TORCH NATURAL GAS LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
UK DATA COLLECTION SERVICES LIMITED
M. N. Eggleton Milton Keynes, D&CM
Buckinghamshire, UK
J. C. W. O'Reilly Milton Keynes, D
Buckinghamshire, UK
M. Booth Milton Keynes, D
Buckinghamshire, UK
J. Stanton Milton Keynes, D
Buckinghamshire, UK
UK ELECTRICITY LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
UK LIGHT AND POWER LIMITED
M. A. Nagle Crawley, West D
Sussex, UK
S. G. Tormey Crawley, West D&S
Sussex, UK
CSW INTERNATIONAL THREE, INC.
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX C
E. R. Brooks Dallas, TX CM
Terry D. Dennis Dallas, TX P&CEO
Paul E. Graf Dallas, TX VP
Wendy G. Hargus Dallas, TX T
Ferd. C. Meyer, Jr. Dallas, TX VP&GC
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX VP
Thomas V. Shockley, III Dallas, TX VCM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW INTERNATIONAL (U.K), INC.
Lee D. Atkins Dallas, TX VP
Sandra S. Bennett Dallas, TX C
E. R. Brooks Dallas, TX D&CM
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX VP
Wendy G. Hargus Dallas, TX T
Ferd. C. Meyer, Jr. Dallas, TX D,VP&GC
Michael T. Moran Dallas, TX VP
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D&VP
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&VCM
ENERGIA INTERNACIONAL DE CSW, S.A. DE C.V.
Terry D. Dennis Dallas, TX D&S
Paul E. Graf Dallas, TX D&T
Michael T. Moran Dallas, TX D
Thomas V. Shockley, III Dallas, TX D&P
ACELTEK, S. DE R.L. DE C.V.
PAUL E. GRAF Dallas, TX D
Alternate: Shariar Dallas, TX Alternate D
Shabba
MICHAEL T. MORAN Dallas, TX D
Alternate: J. Emberger Dallas, TX Alternate D
ALEJANDRO MORENO Monterrey, Mexico D
Alternate: Sergio Olaiz Monterrey, Mexico Alternate D
RAFAEL OJEDA Monterrey, Mexico D&S
Alternate: Arturo Monterrey, Mexico Alternate:D&S
Gutierrez
JUAN LUIS SAN JOSE Monterrey, Mexico D
Alternate: Ramiro Garcia Monterrey, Mexico Alternate D
JOSE DE JESUS VALDEZ Monterrey, Mexico D
Alternate: Nelson Monterrey, Mexico Alternate D
Arizmendi
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
ENERTEK, S.A. DE C.V.
PAUL E. GRAF Dallas, TX D
Alternate: Shariar Dallas, TX Alternate D
Shabba
MICHAEL T. MORAN Dallas, TX D
Alternate: J. Emberger Dallas, TX Alternate D
ALEJANDRO MORENO Monterrey, Mexico D
Alternate: Sergio Olaiz Monterrey, Mexico Alternate D
RAFAEL OJEDA Monterrey, Mexico D&S
Alternate: Arturo Monterrey, Mexico Alternate:D&S
Gutierrez
JUAN LUIS SAN JOSE Monterrey, Mexico D
Alternate: Ramiro Garcia Monterrey, Mexico Alternate D
JOSE DE JESUS VALDEZ Monterrey, Mexico D
Alternate: Nelson Monterrey, Mexico Alternate D
Arizmendi
CINERGY, S. DE R.L. DE C.V.
Officers and directors unavailable.
SERVICIOS CORPORATIVOS INDUSTRIALES DEL NORESTE, S.A. DE C.V.
Officers and directors unavailable.
SERVICIOS INDUSTRIALES Y ADMINISTRATIVOS DEL NORESTE, S. DE R.L. DE C.V.
Officers and directors unavailable.
CSW INTERNATIONAL, INC. (CAYMAN)
Lee D. Atkins Dallas, TX VP
E. R. Brooks Dallas, TX D&CM
Terry D. Dennis Dallas, TX D,P&CEO
Paul E. Graf Dallas, TX VP
Wendy G. Hargus Dallas, TX T
Ferd. C. Meyer, Jr. Dallas, TX D,VP&GC
Michael T. Moran Dallas, TX VP
Eddie D. Peebles Dallas, TX C
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D&VP
Philip T. Schnorbach Dallas, TX AS
Thomas V. Shockley, III Dallas, TX D&VCM
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
CSW VALE L.L.C.
Lee D. Atkins Dallas, TX D&VP
Terry D. Dennis Dallas, TX D&P
Paul E. Graf Dallas, TX D&VP
Alphonso R. Jackson Dallas, TX D&VP
Michael T. Moran Dallas, TX D&VP
Eddie D. Peebles Dallas, TX T
Philip T. Schnorbach Dallas, TX S
EMPRESA DE ELECTRICIDADE VALE DE PARANAPANEMA S.A.
Alberto Jose Rodrigues Alves Sao Paulo, Brazil D
Sebastiao Bimbati Sao Paulo, Brazil T
Jose Theodoro Alves De Araujo Sao Paulo, Brazil D
Fernando Artigas Girogi Sao Paulo, Brazil D
Jose Alberto Artigas Giorgi Sao Paulo, Brazil D
Jose Giorgi Junior Sao Paulo, Brazil D&CM
Natal Mauri Sao Paulo, Brazil D
Carlos Padovan Sao Paulo, Brazil D
Laudo Vota Brancato Sao Paulo, Brazil D
CSW POWER DO BRAZIL LTDA.
CSW Vale, LLC , Grand Cayman Cayman Islands, British Managing Partner
West Indies
Camila da Motta P Alves de Sao Paulo, Brazil Delegate Manager
Aroujo
S.C.E.L. EMPREENDIMENTOS PARTICIPACOES LTDA.
CSW Vale, LLC, Grand Cayman Cayman Islands, British Managing Partner
West Indies
Camila da Motta P Alves de Sao Paulo, Brazil Delegate Manager
Arujo
CSW COELBA L.L.C.
Lee D. Atkins Dallas, TX D & VP
Sandra S. Bennett Dallas, TX T
Terry D. Dennis Dallas, TX D & P
Paul E. Graf Dallas, TX D & VP
Alphonso R. Jackson Dallas, TX D & VP
Michael T. Moran Dallas, TX D & VP
Philip T. Schnorbach Dallas, TX S
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
COELBA FUNDING COMPANY L.L.C.
Alberto .J.R. Alves Sao Paulo, Brazil D & VP
Sandra S. Bennett Dallas, TX T
Terry D. Dennis Dallas, TX D & P
Paul E. Graf Dallas, TX D & VP
J.Q. de Moraes, Jr. Sao Paulo, Brazil D & VP
Philip T. Schnorbach Dallas, TX S
LATIN AMERICAN ENERGY HOLDINGS, INC.
Lee D. Atkins Dallas, TX D & VP
Sandra S. Bennett Dallas, TX C
Terry D. Dennis Dallas, TX D,P & CEO
Paul E. Graf Dallas, TX D & VP
Wendy G. Hargus Dallas, TX T
Alphonso R. Jackson Dallas, TX D & VP
Michael T. Moran Dallas, TX D & VP
Kenneth C. Raney, Jr. Dallas, TX S
Philip T. Schnorbach Dallas, TX AS
CHILE ENERGY HOLDINGS L.L.C.
Lee D. Atkins Dallas, TX D & VP
Sandra S. Bennett Dallas, TX C
Terry D. Dennis Dallas, TX D & P
Paul E. Graf Dallas, TX D & VP
Wendy G. Hargus Dallas, TX T
Alphonso R. Jackson Dallas, TX D & VP
Michael T. Moran Dallas, TX D & VP
Philip T. Schnorbach Dallas, TX S
CSW INTERNATIONAL ENERGY DEVELOPMENT, LTD.
P. Dinan Port Louis, D
Mauritius
Paul E. Graf Dallas, TX D
U.K. Gujadhur Port Louis, D
Mauritius
T.K. Light Dallas, TX D
Michael T. Moran Dallas, TX D
TENASKA CSW INTERNATIONAL, LTD.
P. Dinan Port Louis, Mauritius D
Paul E. Graf Dallas, TX D
U.K. Gujadhur Port Louis, Mauritius D
Michael T. Moran Dallas, TX D
P.G. Smith Omaha, NE D
R.R. Tanner Omaha, NE D
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NAME AND ADDRESS POSITION
ENERSHOP INC.
Richard H. Bremer Dallas, TX D&P
E. R. Brooks Dallas, TX D
Lawrence B. Connors Dallas, TX C
Glenn Files Dallas, TX D
T. M. Hagan Dallas, TX D
Wendy G. Hargus Dallas, TX T
Venita McCellon-Allen Dallas, TX D
Ferd. C. Meyer, Jr. Dallas, TX D
Mike Montgomery Dallas, TX MD
David J. Pickles Dallas, TX AS
Kenneth C. Raney, Jr. Dallas, TX S
Glenn D. Rosilier Dallas, TX D
Thomas V. Shockley, III Dallas, TX D
Jana P. Soward Tulsa, OK AT
CSW ENERGY SERVICES, INC.
Richard H. Bremer Dallas, TX D,P
Shirley Briones Tulsa, OK AS
Glenn Files Dallas, TX D
Wendy G. Hargus Dallas, TX T
Kenneth C. Raney, Jr. Dallas, Tx S
John Saenz (1) Tulsa, OK D,VP
Thomas V. Shockley, III Dallas, TX D
Jana P. Soward Tulsa, OK AT
(1) Mr. Saenz left the company in February 1998.
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART I. (CONTINUED)
NOTE: Other System companies are entities not having officers and directors.
Positions are indicated above by the following symbols:
AC -- Assistant Controller
AGC -- Assistant General Counsel
AS -- Assistant Secretary
AT -- Assistant Treasurer
C -- Controller
CEO -- Chief Executive Officer
CFO -- Chief Financial Officer
CM -- Chairman
CMPT -- Comptroller
COO -- Chief Operating Officer
D -- Director
DCS -- Director, Customer Services
EVP -- Executive Vice President
GC -- General Counsel
GM -- General Manager
MD -- Managing Director
P -- President
S -- Secretary
SVP -- Senior Vice President
T -- Treasurer
VP -- Vice President
VCM -- Vice Chairman
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART II.
Financial Connections - The following is a list, as of December 31, 1997, of all
officers and directors of each System company who have financial connections
within the provisions of Section 17(c) of the Public Utility Holding Company Act
of 1935.
Position
Held in Applicable
Name of Financial Exemption
Officer
or Director Name and Location of Financial Institution Rules
Institution
(1) (2) (3) (4)
- ---------------------------------------------------------------------
CENTRAL AND SOUTH WEST CORPORATION
Robert W. Salomon Brothers Fund, New Director Rule 70(b)
Lawless York, NY
Salomon Brothers Capital Fund, Director Rule 70(b)
New York, NY
Salomon Brothers Investors Director Rule 70(b)
Fund, New York, NY
James L. Southwest Bancorp of Sanderson, Director Rule 70(a)
Powell Sanderson, TX
First National Bank, Mertzon, TX Advisory Rule 70(a)
Director
CENTRAL POWER AND LIGHT COMPANY
Pete Morales, The Bank of Texas, Devine, TX Director Rule 70(c)
Jr.
PUBLIC SERVICE COMPANY OF OKLAHOMA
Paul K. Nations Bank - Tulsa, Tulsa, OK Advisory Rule 70(c)
Lackey, Jr. Director
SOUTHWESTERN ELECTRIC POWER COMPANY
Dr. Frederick First State National Bank, Director Rule 70(c)
E. Joyce Texarkana, TX Director
State First Financial Rule 70(c)
Corporation, Texarkana, TX
First Commercial Corporation, Director Rule 70(c)
Little Rock, AR
John M. Lewis The Bank of Fayetteville, Director Rule 70(c)
Fayetteville, AR
William C. Deposit Guaranty Bank, Director Rule 70(c)
Peatross Shreveport, LA
WEST TEXAS UTILITIES COMPANY
Dian G. Owen First Financial Bankshares, Director Rule 70(c)
Inc., Abilene, TX
First National Bank of Abilene, Director Rule 70(c)
Abilene, TX
James M. First Financial Bankshares, Director Rule 70(c)
Parker Inc., Abilene, TX;
First National Bank of Abilene, Director Rule 70(c)
Abilene, TX
F. L. Stephens Norwest Texas, Lubbock, TX Director Rule 70(c)
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS - PART III.
(A) AND (B) DIRECTORS' AND EXECUTIVE OFFICERS' COMPENSATION AND SECURITY
INTERESTS.
Information concerning compensation and interests in system securities is set
forth on Exhibit F-1 to this Form U5S and is incorporated herein by reference.
(C) DIRECTORS' AND EXECUTIVE OFFICERS' CONTRACTS AND TRANSACTIONS WITH SYSTEM
COMPANIES.
During 1997, CSW retained Mr. Glenn Biggs, a current member of the CSW Board,
under an agreement to pursue special business development activities in Mexico
on behalf of CSW. For the year ended December 31, 1997, CSW paid Mr. Biggs
$120,000 pursuant to this agreement. Effective March 18, 1998, Mr. Biggs
resigned his position as a director of CSW. Mr. Biggs had not previously been
nominated for reelection to the CSW Board. In connection with his resignation,
Mr. Biggs' consulting arrangement was terminated. CSW and Mr. Biggs entered into
an agreement pursuant to which Mr. Biggs was paid, a lump sum for, among other
things, his benefit under certain compensation plans and to pay his director and
CSW Board committee fees through May 1998 and his consulting fees through March
1998. Pursuant to that agreement, Mr. Biggs and his spouse are also entitled to
continued medical and dental coverage under the CSW Medical Plan for Outside
Directors and CSW has agreed to maintain the memorial gift program for Mr.
Biggs.
(D) INDEBTEDNESS OF DIRECTORS OR EXECUTIVE OFFICERS TO SYSTEM COMPANIES.
None.
(E) DIRECTORS' AND EXECUTIVE OFFICERS' PARTICIPATION IN BONUS AND PROFIT-SHARING
ARRANGEMENTS AND OTHER BENEFITS.
See Exhibit F-1 for a description of the participation of directors and
executive officers of System companies in bonus and profit-sharing arrangements
and other benefits.
(F) DIRECTORS' AND EXECUTIVE OFFICERS' RIGHTS TO INDEMNITY.
The state laws under which each of the companies is incorporated provide broadly
for indemnification of directors and officers against claims and liabilities
against them in their capacities as such. Each of the companies' charters or
by-laws also provides for indemnification of directors and officers. In
addition, directors and executive officers of Central and South West Corporation
and all subsidiary companies are insured under directors' and officers'
liability policies issued to Central and South West Corporation by Federal
Insurance Company, Warren, New Jersey; Associated Electric & Gas Insurance
Services, Ltd. Hamilton, Bermuda; Energy Insurance Mutual, Ltd.,Tampa, Florida;
A.C.E. Insurance Company, Ltd., Hamilton, Bermuda; Starr Excess Liability
Insurance Company, Ltd., Hamilton, Bermuda; and X. L. Insurance Company, Ltd.,
Hamilton, Bermuda. All policies are for the period April 27, 1997 to April 27,
1998. The Corporation has entered into a standard form of indemnity agreement
with each of its directors and officers.
<PAGE>
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS.
(1) CSW and several of its subsidiaries have established political action
committees and have incurred, in accordance with the provisions of the
Federal Election Campaign Act, certain costs for the administration of such
committees.
(2) Expenditures, disbursements, or payments, in money, goods or services,
directly or indirectly to or for the account of any citizens group, or
public relations counsel were as follows for 1997:
<TABLE>
<CAPTION>
NAME OF
COMPANY NAME OF RECIPIENT OF BENEFICIARY PURPOSE ACCOUNT CHARGED AMOUNT
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CPL Less than $10,000- 32 Beneficiaries Area Development Inc Ded: A & G. Expense $44,324
PSO Less than $10,000- 4 Beneficiaries Area Development Inc Ded, Dist; Cust 7,200
Svc; A&G Exp
Less than $10,000- 93 Beneficiaries Civic Activities Inc Ded, Dist; Cust 85,296
Svc; A&G Exp
Downtown Tulsa Unlimited, Area Development Inc Ded, Dist; Cust 33,233
Inc. Svc; A&G Exp
Metropolitan Tulsa Chamber of Commerce Civic Activity Inc Ded, Dist; Cust 72,450
Svc; A&G Exp
Oklahoma State Chamber of Commmerce Civic Activity Inc Ded, Dist; Cust 46,364
Svc; A&G Exp
Lawton Chamber of Commerce Civic Activity Inc Ded, Dist; Cust 12,381
Svc; A&G Exp
SWEPCO Less than $10,000 - 54 Beneficiaries Civic Activity Inc Ded, Dist; Cust 42,562
Svc; A&G Exp
Shreveport Chamber of Commerce Civic Activity Inc Ded; Cust Svc; A&G Exp 38,260
Texarkana Chamber of Commerce Civic Activity Inc Ded; Cust Svc; 11,092
A&G Expense
Springdale Chamber of Commerce Civic Activity Inc Ded; Dist, Cust 10,298
Svc; A&G Exp
WTU Less than $10,000 - 59 Beneficiaries Area Development Inc Ded; Dist, Cust 30,938
Svc; A&G Exp
</TABLE>
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS.
Part I. Except those specifically excluded per reporting instructions, there
were no contracts for services, including engineering or construction
services, or goods supplied or sold by a System company to another
System company for 1997.
The electric subsidiary companies have contracts with CSW Credit, Inc. for the
sale of accounts receivable which were in effect at year-end 1997.
SERVING RECEIVING DATE OF
COMPANY COMPANY COMPENSATION CONTRACTS
CPL CREDIT $12,549,392 1/02/91
PSO CREDIT 7,786,577 1/02/91
SWEPCO CREDIT 9,704,642 1/02/91
WTU CREDIT 3,875,757 1/02/91
-----------
$33,916,368
-----------
Part II. The System companies had no contracts to purchase services or goods
during 1997 from any affiliate (other than a System company) or from a
company, in which any officer or director of the receiving company is a
partner or owns 5 percent or more of any class of equity securities,
except as reported in Item 6.
Part III. The following System companies employ those listed below for the
performance on a continuing basis of management, supervisory or
financial advisory services.
System companies participating in an insurance trust, the Risk Management Trust
("RMT"), administered by M. Wilson and Associates, Inc., under the direction of
six Trustees, and the net amounts paid for services and for protection against
property and casualty losses for 1997 were as follows:
CPL $7,810,519
PSO 6,431,772
SWEPCO 5,279,700
WTU 2,759,729
CENTRAL AND SOUTH WEST
SERVICES,INC. 54,597
----------
$22,436,317
----------
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS. (CONTINUED)
As of December 31, 1997, Trustees of the RMT were:
TRUSTEE POSITION COMPANY
Allan F. Director: Risk Central and South West
McGilbra Management Services, Inc.
Department Public Service Company of
Oklahoma
Central Power and Light
Company
Southwestern Electric
Power Company
West Texas Utilities
Company
John P. Wilson Manager: Central and South West
Claims & Services, Inc.
Litigation, Public Service Company of
Risk Oklahoma
Management Central Power and Light
Department Company
Southwestern Electric
Power Company
West Texas Utilities
Company
William N. Treasurer & Kentucky Utilities Company
English Assistant
Secretary
James A. Manager: Kentucky Utilities Company
Brackney Risk
Management
Department
Harold E. Manager: Wisconsin Power & Light
Gustrowsky Risk Company
Management
Department
Loren A. Farrey Risk Wisconsin Power & Light
Management Company
Associate:
Risk
Management
Department
NOTE: On April 21, 1998, the participants of the RMT agreed to dissolve the RMT.
A date for dissolution has not been set.
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES.
PART I - FOREIGN UTILITY COMPANY
SEEBOARD PLC
(a) COMPANY, LOCATION, BUSINESS ADDRESS
SEEBOARD plc
Forest Gate, Brighton Road
Crawley, West Sussex RH11 9BH
During 1996, CSW (UK) plc, an indirect wholly owned subsidiary of CSW acquired
100% control of the outstanding share capital of SEEBOARD, a regional
electricity company in the United Kingdom, for an aggregate adjusted purchase
price of approximately $2.1 billion. On September 3, 1996, CSW (UK) plc's
interest in SEEBOARD was transferred to SEEBOARD Group plc.
SEEBOARD's primary regulated businesses are the distribution and supply of
electricity within its southeast England service area that covers
approximately 3,000 square miles and through which it serves approximately 2
million customers. In addition to the distribution and supply of electricity,
SEEBOARD is involved in gas supply, electricity generation, electrical
contracting and retailing.
The distribution of electricity is the core business of SEEBOARD. Electricity
is transported from generating plants across the United Kingdom, via the
National Grid, to points within SEEBOARD's geographical area, and then
transformed to enter SEEBOARD's distribution system. At December 31, 1997,
SEEBOARD's distribution system contained approximately 7,650 miles of overhead
lines and approximately 19,900 miles of underground cables. The bulk of
SEEBOARD's tangible fixed assets are currently employed in the distribution
business.
SEEBOARD's supply business consists of the bulk purchase of electricity and
its sale to customers. The majority of electricity sold by SEEBOARD in its
supply business is purchased through a pool created in 1990 for the bulk
trading of electricity. The physical delivery of electricity via SEEBOARD's
distribution network results in a cost to the supply business and income to
the distribution business.
(b) IDENTIFY TYPE AND AMOUNT OF CAPITAL INVESTED:
IDENTIFY ANY DEBT OR FINANCIAL OBLIGATION WITH RECOURSE TO CSW OR SUBS:
IDENTIFY ANY GUARANTEE OF A SECURITY OF THE EWG OR FUCO BY CSW: IDENTIFY
ANY TRANSFER OF ASSETS, FMV OF ASSET AT TIME OF TRANSFER, BOOK VALUE AND
SALES PRICE OF TRANSFERRED ASSET:
As of December 31, 1997, CSW had contributed approximately $829 million of the
purchase price for the acquisition of SEEBOARD shares. Those funds, which were
initially obtained through borrowings under the CSW Credit Agreement, have
since been repaid by using the $398 million net proceeds from CSW's February
1996 common stock offering and $431 million of the proceeds from the sale of
Transok.
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES. (CONTINUED)
PART I - FOREIGN UTILITY COMPANY (CONT.)
Additional acquisition funds were obtained from capital contributions and
loans made to CSW (UK) plc (which has been replaced by SEEBOARD Group plc) by
its sole shareholder, CSW Investments, which arranged the CSW Investments
Credit Facility for that purpose. During the second half of 1996, borrowings
under the CSW Investments Credit Facility were refinanced through several
different transactions.
As of December 31, 1997, the amount of debt outstanding related to the
purchase of SEEBOARD shares was approximately $1.1 billion. Neither CSW nor
CSWI, the indirect parent of CSW Investments and SEEBOARD Group plc, has
guaranteed or is otherwise subject to recourse for such amounts borrowed.
(c) RATIO OF DEBT TO COMMON EQUITY AND EARNINGS OF THE COMPANY AT END OF
REPORTING PERIOD:
The following reported items are for the consolidated SEEBOARD Group (SEEBOARD
plc, SEEBOARD Group plc, CSW Investments, CSW Finance Company, CSW
International Two and CSW International Three).
December 31, 1997 (millions)
Ratio 1.19:1
Debt $ 1,087
Equity $ 914
1997 consolidated loss from the SEEBOARD Group (as defined above) was
$58,993,987.
(d) IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACTS WITH CSW OR SUBS:
None.
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES. (CONTINUED)
PART I - FOREIGN UTILITY COMPANY
EMPRESA DE ELETRICIDADE VALE PARANAPANEMA S. A.
(a) COMPANY, LOCATION, BUSINESS ADDRESS:
Empresa de Eletricidade Vale Paranapanema S.A.
Avenida Paulista, No. 2439, 5th floor
Sao Paulo, Sao Paulo
Brazil
(b) IDENTIFY TYPE AND AMOUNT OF CAPITAL INVESTED:
IDENTIFY ANY DEBT OR FINANCIAL OBLIGATION WITH RECOURSE TO CSW OR SUBS:
IDENTIFY ANY GUARANTEE OF A SECURITY OF THE EWG OR FUCO BY CSW: IDENTIFY
ANY TRANSFER OF ASSETS, FMV OF ASSET AT TIME OF TRANSFER, BOOK VALUE AND
SALES PRICE OF TRANSFERRED ASSET:
In October, 1997, CSW Vale L.L.C. purchased an additional 6,302,352 shares of
the common stock and 18,726,220 shares of the Series "B" preferred stock of
Empresa de Eletricidade Vale Paranapanema S.A. for a combined purchase price
of $40,000,000. These funds were obtained through intercompany borrowings from
CSW Energy, Inc. The combined holdings now total 21,498,447 shares (21.42%) of
the common stock and 28,669,149 shares (100%) of the Series "B" preferred
stock for a total investment of $80,050,515.
(c) RATIO OF DEBT TO COMMON EQUITY AND EARNINGS OF THE COMPANY AT END OF
REPORTING PERIOD:
The following reported items are for CSW International, Inc. consolidated (CSW
International, Inc., CSW International, Inc. (Cayman) and CSW Vale L.L.C. as
it relates to the Vale acquisition.
December 31, 1997
Ratio 12:1
Debt $80,050,515
Equity $6,808,490
1997 equity earnings from Empresa de Electricidade Vale Paranapanema S. A.
were $6,808,490.
(d) IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACTS WITH CSW OR SUBS:
None
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES. (CONTINUED)
PART I - FOREIGN UTILITY COMPANY (CONT.)
ENERTEK, S. A. DE C.V.
(a) COMPANY, LOCATION, BUSINESS ADDRESS:
Enertek, S. A. de C. V.
Avenida Gomez Morin IIII-C
Garza Garcia, Nuevo Leon
CP 66254
Mexico
(b) IDENTIFY TYPE AND AMOUNT OF CAPITAL INVESTED:
IDENTIFY ANY DEBT OR FINANCIAL OBLIGATION WITH RECOURSE TO CSW OR SUBS:
IDENTIFY ANY GUARANTEE OF A SECURITY OF THE EWG OR FUCO BY CSW: IDENTIFY
ANY TRANSFER OF ASSETS, FMV OF ASSET AT TIME OF TRANSFER, BOOK VALUE AND
SALES PRICE OF TRANSFERRED ASSET:
Enertek is a special purpose company formed to own a natural gas fired
co-generation plant to be located near the city of Altamira, Tamaulipas,
Mexico. As of December 31, 1997, CSW International, Inc. had made construction
loans of $65,820,125 to Enertek, S.A. de C.V.
(c) RATIO OF DEBT TO COMMON EQUITY AND EARNINGS OF THE COMPANY AT END OF
REPORTING PERIOD:
December 31, 1997
Ratio NA
Debt $65,820,125
Equity $0
Enertek, S. A. de C. V. had no earnings in 1997.
(d) IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACTS WITH CSW OR SUBS:
None
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES. (CONTINUED)
PART I - EXEMPT WHOLESALE GENERATORS
(a) COMPANY, LOCATION, BUSINESS ADDRESS:
CSW Development-3, Inc.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
CSW Northwest GP, Inc.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
CSW Northwest LP, Inc.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
Newgulf Power Venture, Inc.
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
(b) IDENTIFY TYPE AND AMOUNT OF CAPITAL INVESTED:
IDENTIFY ANY DEBT OR FINANCIAL OBLIGATION WITH RECOURSE TO CSW OR SUBS:
IDENTIFY ANY GUARANTEE OF A SECURITY OF THE EWG OR FUCO BY CSW: IDENTIFY
ANY TRANSFER OF ASSETS, FMV OF ASSET AT TIME OF TRANSFER, BOOK VALUE AND
SALES PRICE OF TRANSFERRED ASSET:
Each of the CSW Northwest EWGs and CSW Development-3, Inc. are inactive at
this time and no capital has been invested in them. It is anticipated that
these entities will participate in joint development of energy projects in the
Pacific Northwest.
CSWE, the ultimate parent company of the aforementioned EWGs, has loaned funds
to a nonaffiliated party for development of EWG projects. At December 31,
1997, such loans totaled approximately $5 million.
Newgulf Power Venture, Inc. was organized on October 13, 1994 to own the Texas
Gulf energy project. At December 31, 1997, the capital invested in this EWG,
including funds used for the modification, maintenance and repair required for
recommissioning the plant, totaled approximately $17.9 million.
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES. (CONTINUED)
PART I - EXEMPT WHOLESALE GENERATORS
(c) RATIO OF DEBT TO COMMON EQUITY AND EARNINGS OF THE COMPANY AT END OF
REPORTING PERIOD:
NEWGULF POWER VENTURE, INC.
December 31, 1997
Ratio .70:1
Debt $7,408,973
Equity $10,532,180
In 1997 the Texas Gulf plant was in the process of being refurbished and
recommisioned. It is anticipated that the plant will commence commercial
operations in the first quarter of 1998.
(d) IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACTS WITH CSW OR SUBS:
None.
PART II ORGANIZATIONAL CHART
Foreign Utility Company - see Exhibit H.
Exempt Wholesale Generators - See Exhibit H.
PART III CSW'S AGGREGATE INVESTMENT IN EWG'S AND FUCO'S RESPECTIVELY: THE
RATIO OF CSW'S AGGREGATE INVESTMENT IN EWGS AND FUCOS TO THE
AGGREGATE CAPITAL INVESTMENT OF CSW'S DOMESTIC PUBLIC-UTILITY SUBS:
Foreign Utility Companies: the aggregate investment in FUCOs as of December
31, 1997 was approximately $896 million.
Exempt Wholesale Generators: the aggregate investments (including loans to
nonaffiliated party) as of December 31, 1997 was approximately $27 million.
Ratio of Aggregate Investment to Aggregate Capital Investment* at December 31,
1997: 49%.
* Defined as the average of CSW's reported consolidated retained earnings for
each of the most recent four quarters as of December 31, 1997.
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS.
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
PAGE
REPORTS OF INDEPENDENT PUBLIC ACCOUNTANTS 60 - 61
CONSOLIDATING FINANCIAL STATEMENTS
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARY COMPANIES
Consolidating Statement of Income for the year
ended December 31, 1997 62
Consolidating Balance Sheet as of December 31, 1997 63 - 64
Consolidating Statement of Cash Flows for the year
ended December 31, 1997 65
Consolidating Statement of Retained Earnings for the
year ended December 31, 1997 66
Pursuant to Exhibit A, the combined annual report on Form 10-K for the year
ended December 31, 1997, for CSW, CPL, PSO, SWEPCO and WTU is incorporated
herein by reference.
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
PAGE
CSW ENERGY, INC. AND SUBSIDIARY COMPANIES (UNAUDITED)
Consolidating Statement of Income for the year
ended December 31, 1997 67
Consolidating Balance Sheet as of December 31, 1997 68 - 69
Statement of Cash Flows for the year ended
December 31, 1997 70
Consolidating Statement of Retained Earnings for the
year ended December 31, 1997 71
CSW INTERNATIONAL, INC. AND SUBSIDIARY COMPANIES (UNAUDITED)
Consolidating Statement of Income for the year
ended December 31, 1997 72
Consolidating Balance Sheet as of December 31, 1997 73 - 74
Consolidating Statement of Cash Flows for the year
ended December 31, 1997 75
Consolidating Statement of Retained Earnings for the
year ended December 31, 1997 76
Detailed financial statements not available for
some CSWI companies 77
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Central and South West Corporation:
We have audited the consolidated balance sheets of Central and South West
Corporation (a Delaware corporation) and subsidiary companies as of December 31,
1997 and 1996, and the related consolidated statements of income, stockholders'
equity and cash flows, for each of the three years ended December 31, 1997,
incorporated by reference herein. 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. We did not audit
the financial statements of CSW UK Finance Company (1997 - which includes CSW
Investments) and CSW Investments (1996), which statements reflect total assets
and total revenues of 22 percent and 35 percent in 1997 and 23 percent and 36
percent in 1996, respectively, of the consolidated totals. Those statements were
audited by other auditors whose reports have been furnished to us and our
opinion, insofar as it relates to the amounts included for those entities, is
based solely on the reports of the other auditors.
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 and the reports of other auditors provide a
reasonable basis for our opinion.
In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of Central and South West Corporation and subsidiary
companies as of December 31, 1997 and 1996, and the related consolidated
statements of income, stockholders' equity and cash flows for each of the three
years ended December 31, 1997, in conformity with generally accepted accounting
principles.
Our audits were made for the purpose of forming an opinion on the basic
consolidated financial statements taken as a whole. The consolidating schedules
of Central and South West Corporation and subsidiaries listed in Item 10 are
presented for purposes of complying with the Securities and Exchange
Commission's rules and regulations under the Public Utility Holding Company Act
of 1935 and are not a required part of the basic consolidated financial
statements. These consolidating schedules have been subjected to the auditing
procedures applied in our audits of the basic consolidated financial statements
and, in our opinion, based on our audits and the report of other auditors, are
fairly stated in all material respects in relation to the basic consolidated
financial statements taken as a whole.
Arthur Andersen LLP
Dallas, Texas
February 16, 1998
<PAGE>
AUDITOR'S REPORT TO THE MEMBERS OF CSW UK FINANCE COMPANY
We have audited the consolidated balance sheets of CSW UK Finance Company and
subsidiaries as of 31 December 1997 and the related consolidated statement of
earnings, statements of cash flows and statement of retained earnings for the
year then ended. These consolidated financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these consolidated financial statements base on our audit.
We conducted our audit in accordance with generally accepted auditing standards
in the United States. 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 in 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, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of CSW UK Finance
Company and subsidiaries at 31 December 1997 and the results of their operations
and cash flows for the year then ended in conformity with generally accepted
accounting principles in the United Kingdom.
Generally accepted accounting principles in the United Kingdom vary in certain
significant respects from generally accepted accounting principles in the United
States. Application of generally accepted accounting principles in the United
States would have affected results of operations and shareholders' equity as of
and for the year ended 31 December 1997 to the extent summarised in the notes to
the consolidated financial statements.
Our audit was made for the purpose of forming an opinion on the basic
consolidated financial statements of CSW UK Finance Company and subsidiaries
taken as a whole. The consolidating schedules of CSW UK Finance Company and
subsidiaries under the column headed SEEBOARD in Item 10 are presented under US
generally accepted accounting for purposes of complying with the US Securities
and Exchange Commission's rules and regulations under the Public Utility Holding
Company Act of 1935 and are not a required part of the basic consolidated
financial statements. The column headed SEEBOARD in the consolidating schedules
has been subjected to the auditing procedures applied in our audit of the basic
consolidated financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic consolidated statements taken as a
whole.
KPMG Audit Plc London
Chartered Accountants 27 January 1998
Registered Auditor
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS, EXCEPT PER SHARE AMOUNTS)
ELIM,
RCLSS
CSW CON CPL PSO SWEPCO WTU CORP CSWS COMM CSWL CREDIT CSWE* CSWI* ENERSHOP ESI & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES 5,268 1,376 713 940 398 0 0 5 1 79 16 1,878 3 0 (141)
OPERATING EXPENSES
AND TAXES
Fuel and purchased
power 1,266 453 331 408 170 0 2 0 0 0 0 0 0 0 (98)
UK cost of sales 1,291 0 0 0 0 0 0 0 0 0 0 1,291 0 0 0
Other operating
expense 981 284 135 158 93 71 182 23 0 24 1 242 7 2 (241)
Maintenance 152 60 34 44 14 0 4 0 0 0 0 0 0 0 (4)
Depreciation and
amortization 497 171 81 95 42 1 9 1 0 0 4 93 0 0 0
Taxes, other than
income 195 83 29 56 25 2 8 0 0 (1) 1 0 0 0 (8)
Income taxes 151 74 21 40 9 (25) 1 (7) 0 6 5 30 (2) (1) 0
TOTAL OPERATING
EXPENSES AND TAXES 4,533 1,125 631 801 353 49 206 17 0 29 11 1,656 5 1 (351)
OPERATING INCOME 735 251 82 139 45 (49) (206) (12) 1 50 5 222 (2) (1) 210
OTHER INCOME AND
(DEDUCTIONS) 30 1 5 4 2 244 212 0 0 0 12 16 (1) 0 (465)
INCOME BEFORE INTEREST
AND OTHER CHARGES 765 252 87 143 47 195 6 (12) 1 50 17 238 (3) (1) (255)
INTEREST AND OTHER CHARGES
Interest on long-term debt 333 105 30 40 20 0 4 0 0 0 15 119 0 0 0
Preferred dividend
requirements of subs 12 10 0 2 0 0 0 0 0 0 0 0 0 0 0
Gain on reacquired
preferred stock (10) (2) (4) (2) (1) 0 0 0 0 0 0 0 0 0 (1)
Interest on short-term
debt and other 101 18 11 11 6 42 2 2 0 39 (5) 7 0 0 (32)
TOTAL INTEREST CHARGES 436 131 37 51 25 42 6 2 0 39 10 126 0 0 (33)
INCOME BEFORE
EXTRAORDINARY ITEM 329 121 50 92 22 153 0 (14) 1 11 7 112 (3) (1) (222)
Extraordinary Item - UK
windfall profits tax (176) 0 0 0 0 0 0 0 0 0 0 (176) 0 0 0
NET INCOME FOR COMMON STOCK 153 121 50 92 22 153 0 (14) 1 11 7 (64) (3) (1) (222)
EARNINGS PER SHARE OF CSW COMMON STOCK $0.72
AVERAGE CSW COMMON SHARES OUTSTANDING 212.1
* See Pages 67-71 for additional detail for CSWE and Pages 72-77 for additional
detail for CSWI.
The notes to financial statements (herein incorporated by reference as part of
Exhibit A-1) are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1997
(MILLIONS)
ELIM,
RCLSS
CSW CON CPL PSO SWEPCO WTU CORP CSWS COMM CSWL CREDIT CSWE* CSWI* ENERSHOP ESI & RND
ASSETS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FIXED ASSETS
Electric
Production 5,824 3,107 908 1,392 418 0 0 0 0 0 0 0 0 0 (1)
Transmission 1,558 518 375 456 209 0 0 0 0 0 0 0 0 0 0
Distribution 4,453 1,022 819 871 364 0 0 0 0 0 0 1,378 0 0 (1)
General 1,380 296 197 311 104 1 119 0 0 0 0 352 0 0 0
Construction
work in progress 184 77 41 52 14 0 0 0 0 0 0 0 0 0 0
Nuclear fuel 196 196 0 0 0 0 0 0 0 0 0 0 0 0 0
Total Electric 13,595 5,216 2,340 3,082 1,109 1 119 0 0 0 0 1,730 0 0 (2)
Other diversified 252 0 0 0 0 0 1 43 0 0 199 9 1 0 (1)
13,847 5,216 2,340 3,082 1,109 1 120 43 0 0 199 1,739 1 0 (3)
Less - accumulated
depreciation 5,219 1,846 1,031 1,226 441 1 34 1 0 0 1 639 0 0 (1)
8,628 3,370 1,309 1,856 668 0 86 42 0 0 198 1,100 1 0 (2)
INVESTMENTS IN
SUBSIDIARIES 0 0 0 0 0 3,874 0 0 0 0 0 0 0 0 (3,874)
CURRENT ASSETS
Cash and temporary
cash investments 75 0 2 2 21 188 5 2 5 0 3 46 0 0 (199)
Accounts receivable 916 61 20 82 11 248 34 1 0 706 198 316 1 1 (763)
Under-recovered
fuel costs 84 43 15 13 12 0 0 0 0 0 0 0 0 0 1
Material and supplies,
at average cost 172 65 32 25 14 0 0 0 0 0 0 35 0 0 1
Electric utility fuel
inventory,
substantially
at average cost 65 15 11 26 12 0 0 0 0 0 0 0 0 0 1
Prepayments and other 78 3 4 13 4 5 16 1 0 3 0 37 1 0 (9)
1,390 187 84 161 74 441 55 4 5 709 201 434 2 1 (968)
DEFERRED CHARGES
AND OTHER ASSETS
Mirror CWIP asset 285 285 0 0 0 0 0 0 0 0 0 0 0 0 0
Deferred plant costs 503 484 0 0 19 0 0 0 0 0 0 0 0 0 0
Equity and other
investments 424 2 18 6 1 0 0 7 60 0 113 217 0 0 0
Prepaid benefit cost 156 32 23 25 17 0 0 0 0 0 2 59 0 0 (2)
Income tax related
regulatory assets,
net 329 390 0 0 0 0 0 0 0 0 0 0 0 0 (61)
Goodwill 1,428 0 0 0 0 0 0 0 0 0 0 1,428 0 0 0
Deferred charges and
other assets 308 63 14 47 23 17 4 (1) 0 0 74 64 1 0 2
3,433 1,256 55 78 60 17 4 6 60 0 189 1,768 1 0 (61)
13,451 4,813 1,448 2,095 802 4,332 145 52 65 709 588 3,302 4 1 (4,905)
* See Pages 67-71 for additional detail for CSWE and Pages 72-77 for additional
detail for CSWI.
The notes to financial statements (herein incorporated by reference as part of
Exhibit A-1) are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1997
(MILLIONS)
ELIM,
RCLSS
CSW CON CPL PSO SWEPCO WTU CORP CSWS COMM CSWL CREDIT CSWE* CSWI* ENERSHOP ESI & RND
CAPITALIZATION AND
LIABILITIES
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CAPITALIZATION
Common Stock
Common stock 743 169 157 136 137 743 0 0 0 0 0 0 0 0 (599)
Paid-in-capital 1,039 405 180 245 2 1,039 0 0 13 54 108 829 0 0 (1,836)
Retained earnings 1,746 833 137 324 120 1,746 0 6 3 0 1 43 (4) (1) (1,462)
Foreign currency
translation and
other 28 0 0 0 0 6 0 (19) 0 0 0 23 0 0 18
3,556 1,407 474 705 259 3,534 0 (13) 16 54 109 895 (4) (1) (3,879)
Preferred Stock
Not subject to
mandatory redemption 176 163 5 5 2 0 0 0 0 0 0 0 0 0 1
Subject to mandatory
redemption 26 0 0 26 0 0 0 0 0 0 0 0 0 0 0
Trust Preferred
Securities 335 150 75 110 0 0 0 0 0 0 0 0 0 0
Long-term debt 3,898 1,302 422 547 279 0 60 0 0 0 200 1,087 0 0 1
7,991 3,022 976 1,393 540 3,534 60 (13) 16 54 309 1,982 (4) (1) (3,877)
CURRENT LIABILITIES
Long-term debt and
preferred stock due
within twelve months 32 28 0 4 0 0 0 0 0 0 0 0 0 0 0
Loan notes 56 0 0 0 0 0 0 10 0 0 0 46 0 0 0
Short-term debt 721 143 5 25 0 721 26 0 0 0 0 0 0 0 (199)
Short-term debt--
CSW Credit 637 0 0 0 0 0 0 0 0 636 0 0 0 0 1
Accounts payable 558 84 85 138 37 15 32 54 0 3 152 706 8 2 (758)
Accrued taxes 171 14 (1) 13 11 6 2 (1) 0 (1) (1) 130 0 0 (1)
Accrued interest 87 28 9 13 5 1 1 0 0 0 4 28 0 0 (2)
Other 237 99 26 28 4 0 0 2 0 20 29 35 0 0 (6)
2,499 396 124 221 57 743 61 65 0 658 184 945 8 2 (965)
DEFERRED CREDITS
Accumulated
deferred income
taxes 2,431 1,238 259 396 149 21 14 0 43 (3) 48 267 0 0 (1)
Investment tax
credits 278 142 41 67 28 0 0 0 0 0 0 0 0 0 0
Income tax related
regulatory
liabilities, net 0 0 42 10 10 0 0 0 0 0 0 0 0 0 (62)
Other 252 15 6 8 18 34 10 0 6 0 47 108 0 0 0
2,961 1,395 348 481 205 55 24 0 49 (3) 95 375 0 0 (63)
13,451 4,813 1,448 2,095 802 4,332 145 52 65 709 588 3,302 4 1 (4,905)
* See Pages 67-71 for additional detail for CSWE and Pages 72-77 for additional
detail for CSWI.
The notes to financial statements (herein incorporated by reference as part of Exhibit A-1) are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
ELIM,
RCLSS
CSW CON CPL PSO SWEPCO WTU CORP CSWS COMM CSWL CREDIT CSWE* CSWI* ENERSHOP ESI & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net income 153 121 50 92 22 153 0 (14) 1 11 7 (64) (3) (1) (222)
Non-cash items included
in net income
Depreciation and
amortization 529 193 85 100 43 0 9 1 0 0 4 93 0 0 1
Deferred income taxes
and investment
tax credits 110 30 6 (7) (2) 50 0 1 (5) (1) 13 25 0 0 0
Preferred stock dividends 12 10 0 2 0 0 0 0 0 0 0 0 0 0 0
Gain on reacquired
preferred stock (10) (2) (4) (2) (1) 0 0 0 0 0 0 0 0 0 (1)
Charges for investments
and assets 53 20 10 18 5 0 0 0 0 0 0 0 0 0 0
Changes in assets and
liabilities
Accounts receivable (140) (8) (24) (13) 14 (99) 7 (1) 0 (91) 5 (87) (1) 0 158
Accounts payable 45 14 13 19 4 (93) 4 30 0 2 (5) 153 6 2 (104)
Accrued taxes (155) (51) (13) (12) (2) (180) 1 (1) 0 (2) 0 106 0 (1) 0
Fuel recovery (37) (17) (13) (4) (3) 0 0 0 0 0 0 0 0 0 0
Undistributed earnings 0 0 0 0 0 119 0 0 0 0 0 0 0 0 (119)
Other 166 30 11 7 15 (10) 1 2 8 3 85 23 0 0 (9)
726 340 121 200 95 (60) 22 18 4 (78) 109 249 2 0 (296)
INVESTING ACTIVITIES
Construction
expenditures (507) (127) (80) (108) (31) 0 (9) (23) 0 0 0 (126) (2) 0 (1)
Acquisition expenditures 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Equity investments in
subsidiaries 0 0 0 0 0 (58) 0 (3) 0 0 0 0 0 0 61
CSWE/CSWI non-SEEBOARD
projects (382) 0 0 0 0 0 0 0 0 0 (189) (193) 0 0 0
Sale of National Grid
assets 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Cash proceeds from
sale of subsidiary 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Other (15) 1 (6) (5) 0 0 5 0 0 0 0 (9) 0 0 (1)
(904) (126) (86) (113) (31) (58) (4) (26) 0 0 (189) (328) (2) 0 59
FINANCING ACTIVITIES
Common stock sold 20 0 0 0 0 20 0 0 (2) 22 0 0 0 0 (20)
Capital contributions 0 0 0 0 0 0 0 0 0 0 37 0 0 0 (37)
Proceeds from issuance
of long-term debt 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
SEEBOARD acquisition
financing 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Trust preferred
securities sold 323 145 72 106 0 0 0 0 0 0 0 0 0 0 0
Redemption of preferred
stock (114) (85) (10) (16) (3) 0 0 0 0 0 0 0 0 0 0
Reacquisition/Retirement
of long-term debt (253) (200) 0 (53) 0 0 0 0 0 0 0 0 0 0 0
Other financing
activities (3) 0 0 0 0 0 0 10 0 0 0 (13) 0 0 0
Change in short-term
debt 414 91 (37) (31) (15) 356 (14) 0 0 57 46 0 0 0 (39)
Payment of dividends (383) (168) (60) (93) (26) (369) 0 0 0 (10) 0 0 0 0 343
4 (217) (35) (87) (44) 7 (14) 10 (2) 69 83 (13) 0 0 247
Effect of exchange rate
changes on
cash and cash
equivalents (5) 0 0 0 0 0 0 0 0 0 0 (5) 0 0 0
Net change in cash and
cash equivalents (179) (3) 0 0 20 (111) 4 2 2 (9) 3 (97) 0 0 10
Cash and cash equivalents
at beginning of year 254 3 2 2 1 299 1 0 3 9 0 143 0 0 (209)
Cash and cash equivalents
at end of year 75 0 2 2 21 188 5 2 5 0 3 46 0 0 (199)
SUPPLEMENTAL INFORMATION
Interest paid less
amounts capitalized 413 117 36 50 21 50 6 2 0 40 7 117 0 0 (33)
Income taxes paid 316 62 34 58 16 148 0 (5) 7 8 (9) 2 (1) 0 (4)
* See Pages 67-71 for additional detail for CSWE and Pages 72-77 for additional
detail for CSWI.
The notes to financial statements (herein incorporated by reference as part of
Exhibit A-1) are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CENTRAL AND SOUTH WEST CORPORATION AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
ELIM,
RCLSS
CSW CON CPL PSO SWEPCO WTU CORP CSWS COMM CSWL CREDIT CSWE* CSWI* ENERSHOP ESI & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Retained earnings
at beginning of year 1,963 869 146 322 123 1,963 0 (5) 2 0 (6) 108 (2) 0 (1,557)
Net income for common
stock 153 121 50 92 22 153 0 (14) 1 11 7 (64) (3) (1) (222)
Common stock dividends
and other (370) (157) (59) (90) (25) (370) 0 25 0 (11) 0 (1) 1 0 317
Retained earnings at
end of year 1,746 833 137 324 120 1,746 0 6 3 0 1 43 (4) (1) (1,462)
* See Pages 67-71 for additional detail for CSWE and Pages 72-77 for additional
detail for CSWI.
The notes to financial statements (herein incorporated by reference as part of
Exhibit A-1) are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31,1997
(MILLIONS)
CSWE CSWE CSWD-I CSWD-II CSWFL NEWGULF SWEENY ELIM,
CON RCLSS & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C>
TOTAL OPERATING REVENUES 16 0 3 0 12 1 0 0
OPERATING EXPENSES AND TAXES
Fuel and purchased power 0 0 0 0 0 1 0 (1)
UK cost of sales 0 0 0 0 0 0 0 0
Other operating expense 1 1 2 0 0 0 0 (2)
Maintenance 0 0 0 0 0 0 0 0
Depreciation and amortization 4 0 0 0 3 0 0 1
Taxes other than income 1 0 0 0 0 0 0 1
Income taxes 5 (1) 1 0 5 0 0 0
TOTAL OPERATING EXPENSES 11 0 3 0 8 1 0 (1)
OPERATING INCOME 5 0 0 0 4 0 0 1
OTHER INCOME AND DEDUCTIONS 12 12 0 0 0 0 0 0
INCOME BEFORE INTEREST AND OTHER CHARGES 17 12 0 0 4 0 0 1
INTEREST AND OTHER CHARGES
Interest on long-term debt 15 14 0 0 0 0 0 1
Preferred dividend requirements of subs 0 0 0 0 0 0 0 0
Gain on reacquired preferred stock 0 0 0 0 0 0 0 0
Interest on short-term debt and other (5) 0 (2) 0 (3) 0 0 0
TOTAL INTEREST CHARGES 10 14 0 0 (3) 0 0 (1)
INCOME BEFORE EXTRAORDINARY ITEM 7 (2) 2 0 7 0 0 0
Extraordinary Item- 0 0 0 0 0 0 0 0
NET INCOME FOR COMMON STOCK 7 (2) 2 0 7 0 0 0
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1997
(MILLIONS)
CSWE CSWE CSWD-I CSWD-II CSWFL NEWGULF SWEENY ELIM,
CON RCLSS & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
FIXED ASSETS
Electric
Production 0 0 0 0 0 0 0 0
Transmission 0 0 0 0 0 0 0 0
Distribution 0 0 0 0 0 0 0 0
General 0 0 0 0 0 0 0 0
Construction work in progress 0 0 0 0 0 0 0 0
Nuclear fuel 0 0 0 0 0 0 0 0
Total electric 0 0 0 0 0 0 0 0
Other Diversified 199 3 0 0 0 18 178 0
Total Plant 199 3 0 0 0 18 178 0
Less - accumulated depreciation 1 0 0 0 0 0 0 1
NET PLANT 198 3 0 0 0 18 178 (1)
INVESTMENT IN SUBSIDIARIES 0 0 0 0 0 0 0 0
CURRENT ASSETS
Cash and temporary cash investments 3 0 0 0 0 0 3 0
Accounts Receivable 198 349 0 0 0 0 0 (151)
Unrecovered fuel costs 0 0 0 0 0 0 0 0
Material and supplies, at average cost 0 0 0 0 0 0 0 0
Electric utility fuel inventory, substantially
at average cost 0 0 0 0 0 0 0 0
Prepayments and other 0 0 0 0 0 0 0 0
TOTAL CURRENT ASSETS 201 349 0 0 0 0 3 (151)
DEFERRED CHARGES AND OTHER ASSETS
Mirror CWIP asset 0 0 0 0 0 0 0 0
Deferred plant costs 0 0 0 0 0 0 0 0
Other non-utility investments 113 140 44 0 69 0 0 (140)
Prepaid benefit cost 2 2 0 0 0 0 0 0
Income tax related regulatory assets, net 0 0 0 0 0 0 0 0
Goodwill 0 0 0 0 0 0 0 0
Deferred charges and other assets 74 38 0 0 45 0 0 (9)
TOTAL DEFERRED CHARGES AND OTHER ASSETS 189 180 44 0 114 0 0 (149)
TOTAL ASSETS 588 532 44 0 114 18 181 (301)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31,1997
(MILLIONS)
CSWE CSWE CSWD-I CSWD-II CSWFL NEWGULF SWEENY ELIM,
CON RCLSS & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock
Common stock 0 0 0 0 0 0 0 0
Paid-in-capital 108 111 43 0 83 11 2 (142)
Retained Earnings 1 (25) 4 (4) 26 0 0 0
Foreign currency translation and other 0 0 0 0 0 0 0 0
109 86 47 (4) 109 11 2 (142)
Preferred stock
Not subject to mandatory redemption 0 0 0 0 0 0 0 0
Subject to mandatory redemption 0 0 0 0 0 0 0 0
Trust Preferred Securities 0 0 0 0 0 0 0 0
Long-term debt 200 200 0 0 0 0 0 0
309 286 47 (4) 109 11 2 (142)
CURRENT LIABILITIES
Long-term debt and preferred stock due
within twelve months 0 0 0 0 0 0 0 0
Loan notes 0 0 0 0 0 0 0 0
Short-term debt 0 0 0 0 0 0 0 0
Short-term debt-CSW Credit 0 0 0 0 0 0 0 0
Accounts Payable 152 188 (23) 4 (17) 7 152 (159)
Accrued taxes (1) (2) (2) 0 3 (1) 0 1
Accrued interest 4 4 0 0 0 0 0 0
Other 29 2 0 0 0 0 27 0
Total Current Liabilities 184 192 (25) 4 (14) 6 179 (158)
DEFERRED CREDITS
Accumulared deferred income taxes 48 9 22 0 16 1 0 0
Investment tax credits 0 0 0 0 0 0 0 0
Income tax related regulatory
liabilities, new 0 0 0 0 0 0 0 0
Other 47 45 0 0 3 0 0 (1)
Total Deferred Credits 95 54 22 0 19 1 0 (1)
TOTAL CAPITALIZATION AND LIABILITIES 588 532 44 0 114 18 181 (301)
</TABLE>
<PAGE>
CSW ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
CSWE does not prepare a consolidating statement of cash flows. Instead, a
consolidated statement of cash flows is prepared which is presented as part of
the Central and South West Corporation and Subsidiaries Consolidating Statement
of Cash Flows on Page 65.
<PAGE>
<TABLE>
<CAPTION>
CSW ENERGY, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
CSWE CSWE CSWD-I CSWD-II CSWFL NEWGULF SWEENY ELIM,
CON RCLSS & RND
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Retained earnings at beginning of year (6) (23) 2 (4) 19 0 0 0
Net income for common stock 7 (2) 2 0 7 0 0 0
Common stock dividends and other 0 0 0 0 0 0 0 0
Retained earnings at end of year 1 (25) 4 (4) 26 0 0 0
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
ELIM.
CSWI CSWI CSW CHILE LATIN CSWI RCLSS &
CON CSWI (CAYMAN) VALE LLC ENERGY AMERICAN ENERGY CSWI CSWI Capital SEEBOARD* RND
HOLDINGS ENERGY DEVELOP. 2 3 Trust
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TOTAL OPERATING REVENUES 1,878 0 0 7 1 0 0 0 0 0 1,870 0
OPERATING EXPENSES AND TAXES
Fuel and purchased power 0 0 0 0 0 0 0 0 0 0 0 0
UK cost of sales 1,291 0 0 0 0 0 0 0 0 0 1,291 0
Other operating expense 242 11 0 0 0 0 0 6 0 0 225 0
Maintenance 0 0 0 0 0 0 0 0 0 0 0 0
Depreciation & acquisition
amortization 93 0 0 0 0 0 0 0 0 0 92 1
Taxes other than income 0 0 0 0 0 0 0 0 0 0 0 0
Income taxes 30 (5) 0 3 1 0 0 (6) 0 0 38 (1)
TOTAL OPERATING EXPENSES
AND TAXES 1,656 6 0 3 1 0 0 0 0 0 1,646 0
OPERATING INCOME 222 (6) 0 4 0 0 0 0 0 0 224 0
OTHER INCOME AND (DEDUCTIONS) 16 8 0 0 0 0 0 1 0 0 10 (3)
INCOME BEFORE INTEREST AND
OTHER CHARGES 238 2 0 4 0 0 0 1 0 0 234 (3)
INTEREST AND OTHER CHARGES
Interest on long-term debt 119 0 0 0 0 0 0 0 0 (32) 147 4
Preferred dividend
requirements of subs 0 0 0 0 0 0 0 0 0 0 0 0
Gain on reacquired preferred
stock 0 0 0 0 0 0 0 0 0 0 0 0
Interest on short-term debt
and other 7 12 0 0 0 0 0 3 0 0 0 (8)
TOTAL INTEREST CHARGES 126 12 0 0 0 0 0 3 0 (32) 147 (4)
INCOME BEFORE EXTRAORDINARY ITEM 112 (10) 0 4 0 0 0 (2) 0 32 87 1
Extraordinary Item - UK
windfall profits tax (176) 0 0 0 0 0 0 0 0 0 (176) 0
NET INCOME FOR COMMON STOCK (64) (10) 0 4 0 0 0 (2) 0 32 (89) 1
* SEEBOARD consists of SEEBOARD plc, SEEBOARD Group plc, CSW Investments, and
CSW (UK) FINCO.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1997
(MILLIONS)
ELIM.
CSWI CSWI CSW CHILE LATIN CSWI RCLSS &
CON CSWI (CAYMAN) VALE LLC ENERGY AMERICAN ENERGY CSWI CSWI Capital SEEBOARD* RND
HOLDINGS ENERGY DEVELOP. 2 3 Trust
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
FIXED ASSETS
Electric
Production
Transmission
Distribution 1,378 0 0 0 0 0 0 0 0 0 1,378 0
General 352 6 0 3 0 0 0 0 0 0 304 39
Acquisition Step up 0 0 0 0 0 0 0 0 0 0 48 (48)
Nuclear fuel 0 0 0 0 0 0 0 0 0 0 0 0
Total electric 1,730 6 0 3 0 0 0 0 0 0 1,730 (9)
Other Diversified 9 0 0 0 0 0 0 0 0 0 0 9
1,739 6 0 3 0 0 0 0 0 0 1,730 0
Less - accumulated depreciation 639 0 0 0 0 0 0 1 0 0 639 (1)
1,100 6 0 3 0 0 0 (1) 0 0 1,091 1
CURRENT ASSETS
Cash and temporary cash
investments 46 0 0 2 0 0 0 0 0 0 44 0
Accounts Receivable 316 2 3 0 0 11 1 80 0 0 126 93
Unrecovered fuel costs 0 0 0 0 0 0 0 0 0 0 0 0
Material and supplies, at
average cost 35 0 0 0 0 0 0 0 0 0 35 0
Electric utility fuel
inventory, substantially
at average cost 0 0 0 0 0 0 0 0 0 0 0 0
Prepayments and other 37 0 0 0 0 0 0 0 0 0 36 1
434 2 3 2 0 11 1 80 0 0 241 94
DEFERRED CHARGES AND OTHER ASSETS
Equity and other investments 217 910 80 83 112 0 0 428 0 0 34 (1,430)
Prepaid Benefit Costs 59 0 0 0 0 0 0 0 0 0 59 0
Goodwill 1,428 0 0 0 0 0 0 0 0 0 1,429 (1)
Intercompany Notes Receivable 0 288 0 0 0 0 0 0 0 404 0 (692)
Deferred charges and other assets 64 0 0 0 0 0 0 3 0 0 0 61
1,768 1,198 80 83 112 0 0 431 0 404 1,522 (2,062)
TOTAL ASSETS 3,302 1,206 83 88 112 11 1 510 0 404 2,854 (1,967)
*SEEBOARD consists of SEEBOARD plc, SEEBOARD Group plc, CSW Investments, and
CSW (UK) FINCO
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET
AS OF DECEMBER 31, 1997
(MILLIONS)
ELIM.
CSWI CSWI CSW CHILE LATIN CSWI RCLSS &
CON CSWI (CAYMAN) VALE LLC ENERGY AMERICAN ENERGY CSWI CSWI Capital SEEBOARD* RND
HOLDINGS ENERGY DEVELOP. 2 3 Trust
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock
Common stock 0 0 0 0 0 0 0 0 0 0 0 0
Paid-in-capital 829 829 80 80 0 0 0 836 0 372 793 (2,161)
Retained earnings 43 (15) 0 4 0 0 0 (362) 0 32 (387) 771
Foreign currency translation
and other 23 0 0 0 0 0 0 0 0 0 0 23
895 814 80 84 0 0 0 474 0 404 406 (1,367)
Preferred stock
Not subject to mandatory
redemption 0 0 0 0 0 0 0 0 0 0 0 0
Subject to mandatory
redemption 0 0 0 0 0 0 0 0 0 0 0 0
Long-term debt 1,087 0 0 0 0 0 0 0 0 0 1,500 (413)
1,982 814 80 84 0 0 0 474 0 404 1,906 (1,780)
CURRENT LIABILITIES
Long-term debt and
preferred stock due
within twelve months 0 0 0 0 0 0 0 0 0 0 0 0
Loan notes 46 0 0 0 0 0 0 0 0 0 46 0
Short-term debt 0 0 0 0 0 0 0 0 0 0 0
Short-term debt --CSW Credit 0 0 0 0 0 0 0 0 0 0 0 0
Accounts payable 706 391 3 3 111 11 1 30 0 0 284 (128)
Accrued taxes 130 (3) 0 1 1 0 0 5 0 0 126 0
Accrued interest 28 0 0 0 0 0 0 1 0 0 27 0
Other 35 2 0 0 0 0 0 0 0 0 35 (2)
945 390 3 4 112 11 1 36 0 0 518 (130)
DEFERRED CREDITS
Accumulated deferred
income taxes 267 0 0 0 0 0 0 0 0 0 271 (4)
Investment tax credits 0 0 0 0 0 0 0 0 0 0 0 0
Provisions 0 0 0 0 0 0 0 0 0 0 52 (52)
Income tax related regulatory
liabilities, net 0 0 0 0 0 0 0 0 0 0 0 0
Other 108 2 0 0 0 0 0 0 0 0 107 (1)
375 2 0 0 0 0 0 0 0 0 430 (57)
TOTAL CAPITALIZATION AND
LIABILITIES 3,302 1,206 83 88 112 11 1 510 0 404 2,854 (1,967)
* SEEBOARD consists of SEEBOARD plc, SEEBOARD Group plc, CSW Investments, and
CSW (UK) FINCO.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
ELIM.
CSWI CSWI CSW CHILE LATIN CSWI RCLSS &
CON CSWI (CAYMAN) VALE LLC ENERGY AMERICAN ENERGY CSWI CSWI Capital SEEBOARD* RND
HOLDINGS ENERGY DEVELOP. 2 3 Trust
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net Income (64) (10) 0 4 0 0 0 (2) 0 32 (89) 1
Non-cash items included in
net income
Depreciation and amortization 93 0 0 0 0 0 0 0 0 0 92 1
Deferred income taxes and
investment tax credits 25 0 0 0 0 0 0 0 0 0 20 5
Preferred stock dividends 0 0 0 0 0 0 0 0 0 0 0 0
Gain on reacquired preferred
stock 0 0 0 0 0 0 0 0 0 0 0 0
Charges for investments and assets 0 0 0 0 0 0 0 0 0 0 0 0
Change in Assets and Liabilities
Accounts receivable (87) 159 (1) 0 0 (11) (1) (50) 0 0 (3) (180)
Accounts payable 153 176 1 1 111 11 1 (12) 0 0 (43) (93)
Accrued taxes 106 0 0 1 1 0 0 8 0 0 100 (4)
Fuel recovery 0 0 0 0 0 0 0 0 0 0 0 0
Undistributed earnings 0 0 0 0 0 0 0 0 0 0 0 0
Other 23 1 0 2 0 0 0 0 0 0 21 (1)
249 326 0 8 112 0 0 (56) 0 32 98 (271)
INVESTING ACTIVITIES
Construction expenditures (126) 0 0 (3) 0 0 0 0 0 0 (126) 3
Acquisition expenditures 0 0 0 0 0 0 0 0 0 0 0 0
Equity investments in
subsidiaries 0 0 0 0 0 0 0 0 0 0 1 (1)
CSWE/CSWI non-SEEBOARD projects (193) (40) (40) (43) (112) 0 0 0 0 0 0 42
Sale of National Grid asset
shares 0 0 0 0 0 0 0 0 0 0 0 0
Cash proceeds from sale of
subsidiary 0 0 0 0 0 0 0 0 0 0 0 0
Other (9) 100 0 0 0 0 0 0 0 0 (11) (98)
(328) 60 (40) (46) (112) 0 0 0 0 0 (136) (54)
FINANCING ACTIVITIES
Common stock sold 0 0 0 0 0 0 0 0 0 0 0 0
Capital contributions 0 (393) 40 40 0 0 0 0 0 0 0 313
Proceeds from issuance of
long-term debt 0 0 0 0 0 0 0 0 0 0 26 (26)
SEEBOARD acquisition financing 0 0 0 0 0 0 0 0 0 0 0 0
Trust preferred securities sold 0 0 0 0 0 0 0 0 0 0 0 0
Redemption of preferred stock 0 0 0 0 0 0 0 0 0 0 0 0
Re-acquisition/Retirement of
long-term debt 0 0 0 0 0 0 0 0 0 0 0 0
Other financing activities (13) 0 0 0 0 0 0 0 0 (32) (27) 46
Change in short-term debt 0 0 0 0 0 0 0 0 0 0 0 0
Payment of dividends 0 0 0 0 0 0 0 0 0 0 (47) 47
(13) (393) 40 40 0 0 0 0 0 (32) (48) 380
Effect of exchange rate
changes on cash and cash
equivalents (5) 0 0 0 0 0 0 0 0 0 (5) 0
Net change in cash and cash
equivalents (97) (7) 0 2 0 0 0 (56) 0 0 (91) 55
Cash and cash equivalents at
beginning or year 143 7 0 0 0 0 0 1 0 0 135 0
Cash and cash equivalents at
end of year 46 0 0 2 0 0 0 (55) 0 0 44 55
* SEEBOARD consists of SEEBOARD plc, SEEBOARD Group plc, CSW Investments, and
CSW (UK) FINCO.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
ELIM.
CSWI CSWI CSW CHILE LATIN CSWI RCLSS &
CON CSWI (CAYMAN) VALE LLC ENERGY AMERICAN ENERGY CSWI CSWI Capital SEEBOARD* RND
HOLDINGS ENERGY DEVELOP. 2 3 Trust
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Retained earnings at beginning
of year 108 (5) 0 0 0 0 0 (271) 0 0 (251) 635
Net income for common stock (64) (10) 0 4 0 0 0 (91) 0 32 (89) 90
Common stock dividends and other (1) 0 0 0 0 0 0 0 0 0 (47) 46
Retained earnings at end of year 43 (15) 0 4 0 0 0 (362) 0 32 (387) 771
* SEEBOARD consists of SEEBOARD plc, SEEBOARD Group plc, CSW Investments, and
CSW (UK) FINCO.
</TABLE>
<PAGE>
CSW INTERNATIONAL, INC. AND SUBSIDIARIES
FOR THE YEAR ENDED DECEMBER 31, 1997
(MILLIONS)
Detailed financial statements for certain subsidiaries of CSW International,
Inc. are not available.
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
EXHIBITS
EXHIBIT A ANNUAL REPORTS INCORPORATED BY REFERENCE
The annual reports for CSW (File No. 1-1443), CPL (File No.
0-346), PSO (File No. 0-343), SWEPCO (File No. 1-3146), and WTU
(File No. 0-340) are incorporated herein by reference to their
combined annual report on Form 10-K ("Combined Form 10-K") for
the year ended December 31, 1997.
EXHIBIT B
CSW
B-1.1 Second Restated Certificate of Incorporation of the Corporation
(incorporated herein by reference to Exhibit 3(a) to the 1990 CSW
annual report on Form 10-K File No. 1-1443).
B-1.2 Certificate of Amendment to Second Restated Certificate of
Incorporation of the Corporation (incorporated herein by
reference to Item 10, Exhibit B-1.2 to the 1993 CSW annual report
on Form U5S).
B-1.3 Bylaws of CSW, as amended, (incorporated herein by reference to
Exhibit 3(b) to CSW's 1990 Form 10-K, File No. 1-1443).
B-1.4 Rights Agreement dated as of December 22, 1997 between CSW and
Central and South West Services, Inc., as Rights Agent
(incorporated herein by reference to Exhibit 1 to CSW Form 8-A/A
dated March 19, 1998, File No. 1-1443).
CPL
B-2.1 Restated Articles of Incorporation Without Amendment, Articles of
Correction to Restated Articles of Incorporation Without
Amendment, Articles of Amendment to Restated Articles of
Incorporation, Statements of Registered Office and/or Agent (3),
and Articles of Amendment to the Articles of Incorporation
(incorporated herein by reference to Exhibit 3.1 to CPL's Form
10-Q for the quarterly period ended March 31, 1997).
B-2.2 Bylaws of CPL, as amended (incorporated herein by reference to
Exhibit 3.1 to CPL's Form 10-Q dated September 30, 1996, File No.
0-346).
PSO
B-3.1 Restated Certificate of Incorporation of PSO (incorporated herein
by reference to Exhibit B-3.1 of CSW's 1996 Form U5S, File No.
1-1443).
B-3.2 Bylaws of PSO, as amended (incorporated herein by reference to
Exhibit B-3.2 of CSW's 1996 Form U5S, File No. 1-1443).
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
SWEPCO
B-4.1 Restated Certificate of Incorporation, as amended through May 6,
1997, including Certificate of Amendment of Restated Certificate
of Incorporation (both incorporated herein by reference to
Exhibit 3.4 to SWEPCO's Form 10-Q dated March 31, 1997, File No
1-3146).
B-4.2 Bylaws of SWEPCO, as amended (incorporated herein by reference to
Exhibit 3.3 to SWEPCO's Form 10-Q dated September 30, 1996, File
No. 1-3146).
WTU
B-5.1 Restated Articles of Incorporation, as amended, and Articles of
Amendment to the Articles of Incorporation (both incorporated
herein by reference to Exhibit 3.5 to WTU's March 31, 1997 Form
10-Q, File No. 0-340).
B-5.2 Bylaws of WTU, as amended (incorporated herein by reference to
Exhibit 3.4 to WTU's Form 10-Q dated September 30, 1996, File No.
0-340).
CSWS
B-7.1 Articles of Amendment to the Articles of Incorporation
(incorporated herein by reference to Item 9, Exhibit B-7.1 of the
1987 Central and South West Corporation annual report on Form
U5S).
B-7.2 By-laws, as amended of CSWS (incorporated herein by reference to
Item 10, Exhibit B-7.2 of the 1993 Central and South West
Corporation annual report on Form U5S).
CSWE
B-8.1 Articles of Amendment to the Articles of Incorporation
(incorporated herein by reference to Item 9, Exhibit B-9.1 of the
1987 Central and South West Corporation annual report on Form
U5S).
B-8.2 By-laws (incorporated herein by reference to Item 9, Exhibit
B-9.2 of the 1987 Central and South West Corporation annual
report on Form U5S).
CSWL
B-9.1 Articles of Incorporation (incorporated herein by reference to
Item 9, Part VI of the 1984 Central and South West Corporation
annual report on Form U5S).
B-9.2 By-laws (incorporated herein by reference to Item 9, Part VI of
the 1983 Central and South West Corporation annual report on Form
U5S).
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
CREDIT
B-10.1 Articles of Incorporation (incorporated herein by reference to
Item 9, Part VI of the 1985 Central and South West Corporation
annual report on Form U5S).
B-10.2 By-laws (incorporated herein by reference to Item 9, Exhibit
B-11.2 of the 1987 Central and South West Corporation annual
report on Form U5S).
COMM
B-11.1 Certificate of Incorporation, (incorporated herein by reference
to Item 10, Exhibit B-11.1 of the 1994 Central and South West
Corporation annual report on Form U5S).
B-11.2 By-laws, (incorporated herein by reference to Item 10, Exhibit
B-11.2 of the 1994 Central and South West Corporation annual
report on Form U5S).
CSWI
B-12.1 Certificate of Incorporation, (incorporated herein by reference
to Item 10, Exhibit B-12.1 of the 1994 Central and South West
Corporation annual report on Form U5S).
B-12.2 By-laws, (incorporated herein by reference to Item 10, Exhibit
B-12.2 of the 1994 Central and South West Corporation annual
report on Form U5S).
ENERSHOP
B-13.1 Certificate of Incorporation, (incorporated herein by reference
to Item 10, Exhibit B-13.1 of the 1995 Central and South West
Corporation annual report on Form U5S).
B-13.2 By-laws, (incorporated herein by reference to Item 10, Exhibit
B-13.2 of the 1995 Central and South West Corporation annual
report on Form U5S).
SEEBOARD PLC
B-14.1 Articles of Association, (attached hereto as Exhibit B-14.1).
B-14.2 Memorandum of Association, (attached hereto as Exhibit B-14.2).
ESI
B-15.1 Certificate of Incorporation, (incorporated herein by reference
to Item 10, Exhibit B-15.1 of the 1997 Central and South West
Corporation annual report on Form U5S).
B-15.2 By-laws, (incorporated herein by reference to Item 10, Exhibit
B-15.2 of the 1997 Central and South West Corporation annual
report on Form U5S).
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
EXHIBIT C
CPL
C-1.1
(a) Indenture of mortgage or deed of trust date November 1, 1943,
executed by CPL to the First National Bank of Chicago and Robert L.
Grinnell as trustee, as amended through October 1, 1977,
(incorporated herein by reference to Exhibit 5.01 in File No.
2-60712).
(b) Supplemental Indentures to the First Mortgage Indenture:
DATED FILE REFERENCE EXHIBIT
September 1, 1978 2-62271 2.02
December 15, 1984 Form U-1, No. 70-7003 17
July 1, 1985 2-98944 4 (b)
May 1, 1986 Form U-1, No. 70-7236 4
November 1, 1987 Form U-1, No. 70-7249 4
June 1, 1988 Form U-1, No. 70-7520 2
December 1, 1989 Form U-1, No. 70-7721 3
March 1, 1990 Form U-1, No. 70-7725 10
October 1, 1992 Form U-1, No. 70-8053 10 (a)
December 1, 1992 Form U-1, No. 70-8053 10 (b)
February 1, 1993 Form U-1, No. 70-8053 10 (c)
April 1, 1993 Form U-1, No. 70-8053 10 (d)
May 1, 1994 Form U-1, No. 70-8053 10 (e)
July 1, 1995 Form U-1, No. 70-8053 10 (f)
(c) CPL-obligated, mandatorily redeemable preferred securities of
subsidiary trust holding solely Junior Subordinated Debentures of
CPL:
(c.1) Indenture, dated as of May 1, 1997, between CPL and the Bank of New
York, as Trustee (incorporated herein by reference to Exhibit 4.1 of
CPL's March 31, 1997 Form 10-Q, File No. 0-346).
(c.2) First Supplemental Indenture, dated as of May 1, 1997, between CPL
and the Bank of New York, as Trustee (incorporated herein by
reference to Exhibit 4.2 of CPL's March 31, 1997 Form 10-Q, File No.
0-346).
(c.3) Amended and Restated Trust Agreement of CPL Capital I, dated as of
May 1, 1997, among CPL, as Depositor; the Bank of New York, as
Property Trustee; the Bank of New York (Delaware), as Delaware
Trustee; and the Administrative Trustee (incorporated herein by
reference to Exhibit 4.3 of CPL's March 31, 1997 Form 10-Q, File No.
0-346).
(c.4) Guarantee Agreement, dated as of May 1, 1997, delivered by CPL for
the benefit of the holders of CPL Capital I's Preferred Securities
(incorporated herein by reference to Exhibit 4.4 of CPL's March 31,
1997 Form 10-Q, File No. 0-346).
(c.5) Agreement as to Expenses and Liabilities, dated as of May 1, 1997,
between CPL and CPL Capital I (incorporated herein by reference to
Exhibit 4.5 of CPL's March 31, 1997 Form 10-Q, File No. 0-346).
<PAGE>
PSO
C-2.1
(a) Indenture dated July 1, 1945, as amended, of PSO (incorporated herein
by reference to Exhibit 5.03 in Registration No. 2-60712).
(b) Supplemental Indentures to the First Mortgage Indenture:
DATED FILE REFERENCE EXHIBIT
June 1, 1979 2-64432 2.02
December 1, 1979 2-65871 2.02
March 1, 1983 Form U-1, No. 70-6822 2
May 1, 1986 Form U-1, No. 70-7234 3
July 1, 1992 Form S-3, No. 33-48650 4 (b)
December 1, 1992 Form S-3, No. 33-49143 4 (c)
April 1, 1993 Form S-3, No. 33-49575 4 (b)
June 1, 1993 Form 10-K, No. 0-343 4 (b)
February 1, 1996 Form 8-K, March 4, 1996, 4.01
No. 0-343
February 1, 1996 Form 8-K, March 4, 1996, 4.02
No. 0-343
February 1, 1996 Form 8-K, March 4, 1996, 4.03
No. 0-343
(c) PSO-obligated, mandatorily redeemable preferred securities of
subsidiary trust holding solely Junior Subordinated Debentures of
PSO.
(c.1) Indenture, dated as of May 1, 1997, between PSO and the Bank of New
York, as Trustee (incorporated herein by reference to Exhibit 4.6 of
PSO's March 31, 1997 Form 10-Q, File No. 0-343).
(c.2) First Supplemental Indenture, dated as of May 1, 1997, between PSO
and the Bank of New York, as Trustee (incorporated herein by
reference to Exhibit 4.7 of PSO's March 31, 1997 Form 10-Q, File No.
0-343).
(c.3) Amended and Restated Trust Agreement of PSO Capital I, dated as of
May 1,1997, among PSO, as Depositor; the Bank of New York, as
Property Trustee; the Bank of New York (Delaware), as Delaware
Trustee; and the Administrative Trustee (incorporated herein by
reference to Exhibit 4.8 of PSO's March 31, 1997 Form 10-Q, File No.
0-343).
(c.4) Guarantee Agreement, dated as of May 1, 1997, delivered by PSO for
the benefit of the holders of PSO Capital I's Preferred Securities
(incorporated herein by reference to Exhibit 4.9 of PSO's March 31,
1997 Form 10-Q, File No. 0-343).
(c.5) Agreement as to Expenses and Liabilities, dated as of May 1, 1997,
between PSO and PSO Capital I (incorporated herein by reference to
Exhibit 4.10 of PSO's March 31, 1997 Form 10-Q, File No. 0-343).
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
SWEPCO
C-3.1
(a) Indenture dated February 1, 1940, as amended through November 1,
1976, of SWEPCO (incorporated herein by reference to Exhibit 5.04 in
Registration No.
2-60712).
(b) Supplemental Indentures to the First Mortgage Indenture:
DATED FILE REFERENCE EXHIBIT
August 1, 1978 2-61943 2.02
January 1, 1980 2-66033 2.02
April 1, 1981 2-71126 2.02
May 1, 1982 2-77165 2.02
August 1, 1985 Form U-1, No. 70-7121 4
May 1, 1986 Form U-1, No. 70-7233 3
November 1, 1989 Form U-1, No. 70-7676 3
June 1, 1992 Form U-1, No. 70-7934 10
September 1, 1992 Form U-1, No. 72-8041 10 (b)
July 1, 1993 Form U-1, No. 70-8041 10 (c)
October 1, 1993 Form U-1, No. 70-8239 10 (a)
(c) SWEPCO-obligated, mandatorily redeemable preferred securities of
subsidiary trust holding solely Junior Subordinated Debentures of
SWEPCO.
(c.1) Indenture, dated as of May 1, 1997, between SWEPCO and the Bank of
New York, as Trustee (incorporated herein by reference to Exhibit
4.11 of SWEPCO's March 31, 1997 Form 10-Q, File No. 1-3146).
(c.2) First Supplemental Indenture, dated as of May 1, 1997, between
SWEPCO and the Bank of New York, as Trustee (incorporated herein by
reference to Exhibit 4.12 of SWEPCO's March 31, 1997 Form 10-Q, File
No. 1-3146).
(c.3) Amended and Restated Trust Agreement of SWEPCO Capital I, dated as
of May 1, 1997, among SWEPCO, as Depositor; the Bank of New York, as
Property Trustee; the Bank of New York (Delaware), as Delaware
Trustee; and the Administrative Trustee (incorporated herein by
reference to Exhibit 4.13 of SWEPCO's March 31, 1997 Form 10-Q, File
No. 1-3146).
(c.4) Guarantee Agreement, dated as of May 1, 1997, delivered by SWEPCO
for the benefit of the holders of SWEPCO Capital I's Preferred
Securities (incorporated herein by reference to Exhibit 4.14 of
SWEPCO's March 31, 1997 Form 10-Q, File No. 1-3146).
(c.5) Agreement as to Expenses and Liabilities, dated as of May 1, 1997
between SWEPCO and SWEPCO Capital I (incorporated herein by reference
to Exhibit 4.15 of SWEPCO's March 31, 1997 Form 10-Q, File No.
1-3146).
<PAGE>
WTU
C-4.1
(a) Indenture dated August 1, 1943, as amended through July 1, 1973, of
WTU, incorporated herein by reference to Exhibit 5.05 in File No.
2-60712.
(b) Supplemental Indentures to the First Mortgage Indenture:
DATED FILE REFERENCE EXHIBIT
May 1, 1979 2-63931 2.02
November 15, 1981 2-74408 4.02
November 1, 198 Form U-1, No. 70-6820 12
April 15, 1985 Form U-1, No. 70-6925 13
August 1, 1985 2-98843 4 (b)
May 1, 1986 Form U-1, No. 70-7237 4
December 1, 1989 Form U-1, No. 70-7719 3
June 1, 1992 Form U-1, No. 70-7936 10
October 1, 1992 Form U-1, No. 72-8057 10
February 1, 1994 Form U-1, No. 70-8265 10
March 1, 1995 Form U-1, No. 70-8057 10 (b)
October 1, 1995 Form U-1, No. 70-8057 10 (c)
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS. (CONTINUED)
EXHIBIT D
D-1 Tax allocation agreement - filed herewith.
EXHIBIT E
E-1 SWEPCO Statement of Environmental Laboratory Services for the year
ended December 31,1997 - filed herewith.
EXHIBIT F
F-1 Item 6. Part III. (a) and (b) - Compensation and Other Related
Information for the Officers and Directors of CSW, CPL, PSO, SWEPCO,
and WTU - filed herewith.
F-2 Detailed financial statements for certain subsidiaries of CSW Energy,
Inc. for the year ended December 31, 1997 - filed pursuant to Section
22(b).
F-3 Detailed financial statements for SEEBOARD plc and subsidiaries for
the year ended December 31, 1997 - filed pursuant to Section 22(b).
F-4 Financial statements of Ash Creek Mining Company for the year ended
December 31, 1997 - filed herewith.
F-5 Financial statements of the Arklahoma Corporation for the fiscal year
ended December 31, 1997 - filed herewith.
EXHIBIT G Financial Data Schedules - filed herewith.
EXHIBIT H ORGANIZATIONAL CHARTS
H-1 Organizational charts for investment in foreign utility company -
filed herewith.
H-2 Organizational charts for investments in exempt wholesale generators
- filed herewith.
EXHIBIT I Audited Financial Statements of SEEBOARD plc for the fiscal year
ended December 31, 1997. Please refer to CSW International, Inc.
consolidating statements filed herewith.
<PAGE>
S I G N A T U R E
Central and South West Corporation has duly caused this annual report for
the year ended December 31, 1997, to be signed on its behalf by the undersigned
thereunto duly authorized pursuant to the requirements of the Public Utility
Holding Company Act of 1935.
CENTRAL AND SOUTH WEST CORPORATION
Date: April 30, 1998 By Lawrence B. Connors
Controller
<PAGE>
S I G N A T U R E
Southwestern Electric Power Company has duly caused this annual report for
the year ended December 31, 1997, to be signed on its behalf by the undersigned
thereunto duly authorized pursuant to the requirements of the Public Utility
Holding Company Act of 1935.
SOUTHWESTERN ELECTRIC POWER COMPANY
Date: April 30, 1998 By R. Russell Davis
Controller
CERTIFICATE OF INCORPORATION
OF
CSW ENERGY SERVICES, INC.
The undersigned, for the purpose of organizing a corporation under
the General Corporation Law of the State of Delaware, certifies:
FIRST: The name of the corporation is CSW Energy Services, Inc.
(hereinafter referred to as the "Corporation").
SECOND: The address of the Corporation's registered office in the
State of Delaware is The Corporation Trust Center, 1209 Orange Street,
Wilmington, Delaware 19801, County of New Castle. The name of its registered
agent at such address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware (hereinafter referred to as the "GCL").
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is one thousand (1000) shares of common stock,
each without par value.
Each holder of Common Stock shall have one vote in respect of each
share of Common Stock held by such holder of record on the books of the
Corporation for the election of directors and on all other matters on which
stockholders of the Corporation are entitled to vote. The holders of shares of
Common Stock shall be entitled to receive, when and if declared by the Board of
Directors, out of the assets of the Corporation which are by law available
therefor, dividends payable either in cash, in stock or otherwise.
FIFTH: The directors shall have power to adopt, amend or repeal
By-Laws of the Corporation, except as may otherwise be provided in the By-Laws
of the Corporation.
SIXTH: Election of directors need not be by written ballot, except
as may otherwise be provided in the By-Laws of the Corporation.
SEVENTH: The name and mailing address of the incorporator is
Guilford W. Gaylord, Milbank, Tweed, Hadley and McCloy, One Chase Manhattan
Plaza, New York, New York 10005-1413.
WITNESS my signature this 24th day of September 1997.
Guilford W. Gaylord
Sole Incorporator
BYLAWS
OF
CSW ENERGY SERVICES, INC.
<PAGE>
BYLAWS
OF
CSW ENERGY SERVICES, INC.
ARTICLE I
OFFICE AND RECORDS
SECTION 1.1 DELAWARE OFFICE.The principal office of the Corporation
in the State of Delaware shall be located in the City of Wilmington, County of
New Castle, and the name and address of its registered agent is The Corporation
Trust Company, 1209 Orange Street, Wilmington, Delaware.
SECTION 1.2 OTHER OFFICES. The Corporation may have such other
offices, either within or without the State of Delaware, as the Board of
Directors may designate or as the business of the Corporation may from time to
time require.
SECTION 1.3 BOOKS AND RECORDS. The books and records of the
Corporation may be kept at the Corporation's principal executive offices in
Dallas, Texas or at such other locations outside the State of Delaware as may
from time to time be designated by the Board of Directors.
ARTICLE II
STOCKHOLDERS
SECTION 2.1 ANNUAL MEETING. Except as otherwise provided in Section
2.8 of these Bylaws, an annual meeting of stockholders of the Corporation shall
be held at such time and date in each year as the Board of Directors, the
Chairman of the Board, if any, or the President may from time to time determine.
The annual meeting in each year shall be held at such place within or without
the State of Delaware as may be fixed by the Board of Directors, or if not so
fixed, at 10 A.M., local time, at the principal executive offices of the
Corporation.
SECTION 2.2 SPECIAL MEETINGS. A special meeting of the holders of
stock of the Corporation entitled to vote on any business to be considered at
any such meeting may be called only by the Chairman of the Board, if any, or the
President or any Vice President, and shall be called by the Chairman of the
Board, if any, or the President or the Secretary when directed to do so by
resolution of the Board of Directors or at the written request of directors
representing a majority of the total number of directors which the Corporation
would at the time have if there were no vacancies (the "Whole Board"). Any such
request shall state the purpose or purposes of the proposed meeting. The Board
of Directors may designate the place of meeting for any special meeting of
stockholders, and if no such designation is made, the place of meeting shall be
the principal executive offices of the Corporation.
SECTION 2.3 NOTICE OF MEETINGS. Whenever stockholders are required
or permitted to take any action at a meeting, unless notice is waived as
provided in Section 8.1 of these Bylaws, a written notice of the meeting shall
be given which shall state the place, date and hour of the meeting, and, in the
case of a special meeting, the purpose or purposes for which the meeting is
called.
Unless otherwise provided by law, and except as to any stockholder
duly waiving notice, the written notice of any meeting shall be given personally
or by mail, not less than ten nor more than sixty (60) days before the date of
the meeting to each stockholder entitled to vote at such meeting. If mailed,
notice shall be deemed given when deposited in the mail, postage prepaid,
directed to the stockholder at his or her address as it appears on the records
of the Corporation.
When a meeting is adjourned to another time or place, notice need
not be given of the adjourned meeting if the time and place thereof are
announced at the meeting at which the adjournment is taken. At the adjourned
meeting the Corporation may transact any business which might have been
transacted at the original meeting. If, however, the adjournment is for more
than thirty (30) days, or if after the adjournment a new record date is fixed
for the adjourned meeting, a notice of the adjourned meeting shall be given to
each stockholder of record entitled to vote at the meeting.
SECTION 2.4 QUORUM. Except as otherwise provided by law or by the
Certificate of Incorporation or by these Bylaws, at any meeting of stockholders
the holders of a majority of the outstanding stock entitled to vote thereat,
either present or represented by proxy, shall constitute a quorum for the
transaction of any business, but the stockholders present, although less than a
quorum, may adjourn the meeting to another time or place and, except as provided
in the last paragraph of Section 2.3 of these Bylaws, notice need not be given
of the adjourned meeting.
SECTION 2.5 VOTING. Whenever directors are to be elected at a
meeting, they shall be elected by a plurality of the votes cast at the meeting
by the holders of stock entitled to vote. Whenever any corporate action, other
than the election of directors, is to be taken by vote of stockholders at a
meeting, it shall, except as otherwise required by law or by the Certificate of
Incorporation or by these Bylaws, be authorized by a majority of the votes cast
with respect thereto at the meeting (including abstentions) by the holders of
stock entitled to vote thereon.
Except as otherwise provided by law, or by the Certificate of
Incorporation, each holder of record of stock of the Corporation entitled to
vote on any matter at any meeting of stockholders shall be entitled to one vote
for each share of such stock standing in the name of such holder on the stock
ledger of the Corporation on the record date for the determination of the
stockholders entitled to vote at the meeting.
Upon the demand of any stockholder entitled to vote, the vote for
directors or the vote on any other matter at a meeting shall be by written
ballot, but otherwise the method of voting and the manner in which votes are
counted shall be discretionary with the presiding officer at the meeting.
SECTION 2.6 PROXIES. Each stockholder entitled to vote at a meeting
of stockholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for him or her
by proxy, but no such proxy shall be voted or acted upon after three years from
its date, unless the proxy provides for a longer period. Every proxy shall be
signed by the stockholder or by his duly authorized attorney.
SECTION 2.7 LIST OF STOCKHOLDERS. The officer who has charge of the
stock ledger of the Corporation shall prepare and make, at least ten (10) days
before every meeting of stockholders, a complete list of the stockholders
entitled to vote at the meeting, arranged in alphabetical order, and showing the
address of each stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten (10) days prior to the meeting, either at a place within
the city where the meeting is to be held, which place shall be specified in the
notice of the meeting, or, if not so specified, at the place where the meeting
is to be held. The list shall also be produced and kept at the time and place of
the meeting during the whole time thereof, and may be inspected by any
stockholder who is present.
The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list required by this
Section or the books of the Corporation, or to vote in person or by proxy at any
meeting of stockholders.
SECTION 2.8 WRITTEN CONSENT OF STOCKHOLDERS IN LIEU OF MEETING. Any
action required by the General Corporation Law of the State of Delaware (the
"GCL") to be taken at any annual or special meeting of stockholders of the
Corporation, or any action which may be taken at any annual or special meeting
of the stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted. Prompt written notice of the taking of the corporate action without a
meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing. Any such written consent may be
given by one or any number of substantially concurrent written instruments of
substantially similar tenor signed by such stockholders, in person or by
attorney or proxy duly appointed in writing, and filed with the Secretary or an
Assistant Secretary of the Corporation. Any such written consent shall be
effective as of the effective date thereof as specified therein, provided that
such date is not more than sixty (60) days prior to the date such written
consent is filed as aforesaid, or, if no such date is so specified, on the date
such written consent is filed as aforesaid.
ARTICLE III
DIRECTORS
SECTION 3.1 NUMBER OF DIRECTORS. The Board of Directors shall
consist of three directors until changed as provided in this Section. The number
of directors may be changed at any time and from time to time by vote at a
meeting or by written consent of the holders of stock entitled to vote on the
election of directors, or by a resolution of the Board of Directors passed by a
majority of the Whole Board, except that no decrease shall shorten the term of
any incumbent director unless such director is specifically removed pursuant to
Section 3.5 of these Bylaws at the time of such decrease.
SECTION 3.2 ELECTION AND TERM OF DIRECTORS. Director shall be
elected annually, by election at the annual meeting of stockholders or by
written consent of the holders of stock entitled to vote thereon in lieu of such
meeting. If the annual election of directors is not held on the date designated
therefor, the directors shall cause such election to be held as soon thereafter
as convenient. Each director shall hold office from the time of his or her
election and qualification until his successor is elected and qualified or until
his or her earlier resignation, or removal.
SECTION 3.3 VACANCIES AND NEWLY CREATED DIRECTORSHIPS. Vacancies
and newly created directorships resulting from any increase in the authorized
number of directors may be filled by election at a meeting of stockholders or by
written consent of the holders of stock entitled to vote thereon in lieu of a
meeting. Except as otherwise provided by law, vacancies and such newly created
directorships may also be filled by a majority of the directors then in office,
although less than a quorum, or by a sole remaining director.
SECTION 3.4 RESIGNATION. Any director may resign at any time upon
written notice to the Corporation. Any such resignation shall take effect at the
time specified therein or, if the time be not specified, upon receipt thereof,
and the acceptance of such resignation, unless required by the terms thereof,
shall not be necessary to make such resignation effective.
SECTION 3.5 REMOVAL. Any or all of the directors may be removed at
any time, with or without cause, by vote at a meeting or by written consent of
the holders of stock entitled to vote on the election of directors.
SECTION 3.6 MEETINGS. Meetings of the Board of Directors, regular
or special, may be held at any place within or without the State of Delaware.
Members of the Board of Directors, or of any committee designated by the Board
of Directors, may participate in a meeting of the Board of Directors or such
committee by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and participation in a meeting by such means shall constitute presence in person
at such meeting. An annual meeting of the Board of Directors shall be held after
each annual election of directors. If such election occurs at an annual meeting
of stockholders, the annual meeting of the Board of Directors shall be held at
the same place and immediately following such meeting of stockholders, and no
further notice thereof need be given other than this Bylaw. If an annual
election of directors occurs by written consent in lieu of the annual meeting of
stockholders, the annual meeting of the Board of Directors shall take place as
soon after such written consent is duly filed with the Corporation as is
practicable, either at the next regular meeting of the Board of Directors or at
a special meeting. The Board of Directors may fix times and places for
additional regular meetings of the Board of Directors and no notice of such
meetings need be given. A special meeting of the Board of Directors shall be
held whenever called by the Chairman of the Board, if any, or by the President
or by at least one-third of the directors for the time being in office, at such
time and place as shall be specified in the notice or waiver thereof. Notice of
each special meeting shall be given by the Secretary or by a person calling the
meeting to each director by mailing the same, postage prepaid, not later than
the second day before the meeting, or personally or by telegraphing or
telephoning the same not later than the day before the meeting.
SECTION 3.7 QUORUM AND VOTING. A whole number of directors equal to
at least a majority of the Whole Board shall constitute a quorum for the
transaction of business, but if there be less than a quorum at any meeting of
the Board of Directors, a majority of the directors present may adjourn the
meeting from time to time, and no further notice thereof need be given other
than announcement at the meeting which shall be so adjourned. Except as
otherwise provided by law, by the Certificate of Incorporation, or by these
Bylaws, the vote of a majority of the directors present at a meeting at which a
quorum is present shall be the act of the Board of Directors.
SECTION 3.8 WRITTEN CONSENT OF DIRECTORS IN LIEU OF A MEETING. Any
action required or permitted to be taken at any meeting of the Board of
Directors or of any committee thereof may be taken without a meeting if all
members of the Board of Directors or of such committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Board of Directors or such committee.
SECTION 3.9 COMPENSATION. Directors may receive compensation for
services to the Corporation in their capacities as directors or otherwise in
such manner and in such amounts as may be fixed from time to time by the Board
of Directors.
SECTION 3.10 COMMITTEES OF THE BOARD OF DIRECTORS. The Board of
Directors may from time to time, by resolution passed by majority of the Whole
Board, designate one or more committees, each committee to consist of one or
more directors of the Corporation. The Board of Directors may designate one or
more directors as alternate members of any committee, who may replace any absent
or disqualified member at any meeting of the committee. The resolution of the
Board of Directors may, in addition or alternatively, provide that in the
absence or disqualification of a member of a committee, the member or members
thereof present at any meeting and not disqualified from voting, whether or not
he, she or they constitute a quorum, may unanimously appoint another member of
the Board of Directors to act at the meeting in the place of any such absent or
disqualified member. Any such committee, to the extent provided in the
resolution of the Board of Directors, shall have and may exercise all the powers
and authority of the Board of Directors in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it, except as otherwise provided by law.
Unless the resolution of the Board of Directors expressly so provides, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Any such committee may adopt rules governing
the method of calling and time and place of holding its meetings. Unless
otherwise provided by the Board of Directors, a majority of any such committee
(or the member thereof, if only one) shall constitute a quorum for the
transaction of business, and the vote of a majority of the members of such
committee present at a meeting at which a quorum is present shall be the act of
such committee. Each such committee shall keep a record of its acts and
proceedings and shall report thereon to the Board of Directors whenever
requested so to do. Any or all members of any such committee may be removed,
with or without cause, by resolution of the Board of Directors, passed by a
majority of the whole Board.
ARTICLE IV
OFFICERS, AGENTS AND EMPLOYEES
SECTION 4.1 APPOINTMENT AND TERM OF OFFICE. The officers of the
Corporation may include a President, a Secretary and a Treasurer, and may also
include a Chairman of the Board, one or more Vice Presidents, one or more
Assistant Secretaries and one or more Assistant Treasurers. All such officers
shall be appointed by the Board of Directors or by a duly authorized committee
thereof, and shall each have such powers and duties as generally pertain to
their respective offices, subject to the specific provisions of this Article IV,
together with such other powers and duties as from time to time may be conferred
by the Board of Directors or any committee thereof. Any number of such offices
may be held by the same person, but no officer shall execute, acknowledge or
verify any instrument in more than one capacity. Except as may be prescribed
otherwise by the Board of Directors or a committee thereof in a particular case,
all such officers shall hold their offices at the pleasure of the Board of
Directors for an unlimited term and need not be reappointed annually or at any
other periodic interval. The Board of Directors may appoint, and may delegate
power to appoint, such other officers, agents and employees as it may deem
necessary or proper, who shall hold their offices or positions for such terms,
have such authority and perform such duties as may from time to time be
determined by or pursuant to authorization of the Board of Directors.
SECTION 4.2 RESIGNATION AND REMOVAL. Any officer may resign at any
time upon written notice to the Corporation. Any officer, agent or employee of
the Corporation may be removed by the Board of Directors, or by a duly
authorized committee thereof, with or without cause at any time. The Board of
Directors or such a committee thereof may delegate such power of removal as to
officers, agents and employees not appointed by the Board of Directors or such a
committee. Such removal shall be without prejudice to a person's contract
rights, if any, but the appointment of any person as an officer, agent or
employee of the Corporation shall not of itself create contract rights.
SECTION 4.3 COMPENSATION AND BOND. The compensation of the officers
of the Corporation shall be fixed by the Board of Directors, but this power may
be delegated to any officer in respect of other officers under his or her
control. The Corporation may secure the fidelity of any or all of its officers,
agents or employees by bond or otherwise.
SECTION 4.4 CHAIRMAN OF THE BOARD. The Chairman of the Board, if
there be one, shall preside at all meetings of stockholders and of the Board of
Directors, and shall have such other powers and duties as may be delegated to
him or her by the Board of Directors.
SECTION 4.5 PRESIDENT. The President shall be the chief executive
officer of the Corporation. In the absence of the Chairman of the Board (or if
there be none), he or she shall preside at all meetings of the stockholders and
of the Board of Directors. He or she shall have general charge of the business
affairs of the Corporation. He or she may employ and discharge employees and
agents of the Corporation, except such as shall be appointed by the Board of
Directors, and he or she may delegate these powers. The President may vote the
stock or other securities of any other domestic or foreign corporation of any
type or kind which may at any time be owned by the Corporation, may execute any
stockholders' or other consents in respect thereof and may in his or her
discretion delegate such powers by executing proxies, or otherwise, on behalf of
the Corporation. The Board of Directors by resolution from time to time may
confer like powers upon any other person or persons.
SECTION 4.6 VICE PRESIDENTS. Each Vice President shall have such
powers and perform such duties as the Board of Directors or the President may
from time to time prescribe. In the absence or inability to act of the
President, unless the Board of Directors shall otherwise provide, the Vice
President who has served in that capacity for the longest time and who shall be
present and able to act, shall perform all the duties and may exercise any of
the powers of the President.
SECTION 4.7 TREASURER. The Treasurer shall have charge of all funds
and securities of the Corporation, shall endorse the same for deposit or
collection when necessary and deposit the same to the credit of the Corporation
in such banks or depositaries as the Board of Directors may authorize. He or she
may endorse all commercial documents requiring endorsements for or on behalf of
the Corporation and may sign all receipts and vouchers for payments made to the
Corporation. He or she shall have all such further powers and duties as
generally are incident to the position of Treasurer or as may be assigned to him
or her by the President or the Board of Directors.
SECTION 4.8 SECRETARY. The Secretary shall record all the
proceedings of the meetings of the stockholders and directors in a book to be
kept for that purpose and shall also record therein all action taken by written
consent of the stockholders or directors in lieu of a meeting. He or she shall
attend to the giving and serving of all notices of the Corporation. He or she
shall have custody of the seal of the Corporation and shall attest the same by
his or her signature whenever required. He or she shall have charge of the stock
ledger and such other books and papers as the Board of Directors may direct, but
he or she may delegate responsibility for maintaining the stock ledger to any
transfer agent appointed by the Board of Directors. He or she shall have all
such further powers and duties as generally are incident to the position of
Secretary or as may be assigned to him or her by the President or the Board of
Directors.
SECTION 4.9 ASSISTANT TREASURERS. In the absence or inability to
act of the Treasurer, any Assistant Treasurer may perform all the duties and
exercise all the powers of the Treasurer. An Assistant Treasurer shall also
perform such other duties as the Treasurer or the Board of Directors may assign
to him or her.
SECTION 4.10 ASSISTANT SECRETARIES. In the absence or inability to
act of the Secretary, any Assistant Secretary may perform all the duties and
exercise all the powers of the Secretary. An Assistant Secretary shall also
perform such other duties as the Secretary or the Board of Directors may assign
to him or her.
SECTION 4.11 DELEGATION OF DUTIES. In case of the absence of any
officer of the Corporation, or for any other reason that the Board of Directors
may deem sufficient, the Board of Directors may confer for the time being the
powers or duties, or any of them, of such officer upon any other officer or upon
any director.
ARTICLE V
INDEMNIFICATION AND INSURANCE
SECTION 5.1 RIGHT TO INDEMNIFICATION Each person who was or is made
a party or is threatened to be made a party to or is otherwise involved in any
action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of the fact that he or she
or a person of whom he or she is the legal representative is or was a director
or an officer of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of any other corporation
or of a partnership, joint venture, trust or other enterprise, including service
with respect to any employee benefit plan (hereinafter an "indemnitee"), whether
the basis of such proceeding is alleged action in an official capacity as a
director, officer, employee or agent or in any other capacity while serving as a
director, officer, employee or agent, shall be indemnified and held harmless by
the Corporation to the fullest extent authorized by the GCL, as the same exists
or may hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior
to such amendment), against all expense, liability and loss (including, without
limitation, attorneys' fees, judgments, fines, excise taxes or penalties under
the Employee Retirement Income Security Act of 1974, as amended, and amounts
paid or to be paid in settlement) reasonably incurred by such indemnitee in
connection therewith; PROVIDED, HOWEVER, that except as provided in Section 5.3
with respect to proceedings seeking to enforce rights to indemnification, the
Corporation shall indemnify any such indemnitee seeking indemnification in
connection with a proceeding (or part thereof) initiated by such indemnitee only
if such proceeding (or part thereof) was authorized by the Board of Directors.
SECTION 5.2 RIGHT TO ADVANCEMENT OF EXPENSES. The right to
indemnification conferred in Section 5.1 shall include the right to be paid by
the Corporation the expenses (including attorneys' fees) incurred in defending
any such proceeding in advance of its final disposition (hereinafter an
"advancement of expenses"); PROVIDED, HOWEVER, that, if the GCL requires, an
advancement of expenses incurred by an indemnitee in his or her capacity as a
director or officer (and not in any other capacity in which service was or is
rendered by such indemnitee, including, without limitation, service to an
employee benefit plan) shall be made only upon delivery to the Corporation of an
undertaking (hereinafter an "undertaking"), by or on behalf of such indemnitee,
to repay all amounts so advanced if it shall ultimately be determined by final
judicial decision from which there is no further right to appeal (hereinafter a
"final adjudication") that such indemnitee is not entitled to be indemnified for
such expenses under this Section 5.2 or otherwise.
SECTION 5.3 RIGHT OF INDEMNITEE TO BRING SUIT. If a claim under
Section 5.1 or Section 5.2 is not paid in full by the Corporation within thirty
(30) days after a written claim has been received by the Corporation, except in
the case of a claim for an advancement of expenses, in which case the applicable
period shall be twenty (20) days, the indemnitee may at any time thereafter
bring suit against the Corporation to recover the unpaid amount of the claim. If
successful in whole or in part in any such suit, or in a suit brought by the
Corporation to recover an advancement of expenses pursuant to the terms of an
undertaking, the indemnitee shall be entitled to be paid also the expense of
prosecuting or defending such suit. In (i) any suit brought by the indemnitee to
enforce a right to indemnification hereunder (but not in a suit brought by the
indemnitee to enforce a right of an advancement of expenses) it shall be a
defense that, and (ii) in any suit brought by the Corporation to recover an
advancement of expenses pursuant to the terms of an undertaking, the Corporation
shall be entitled to recover such expenses upon a final adjudication that, the
indemnitee has not met any applicable standard for indemnification set forth in
the GCL. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel or stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the indemnitee is proper in the circumstances because the indemnitee has met the
applicable standard of conduct set forth in the GCL, nor an actual determination
by the Corporation (including its Board of Directors, independent legal counsel
or stockholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or brought by the Corporation to recover an advancement of expenses pursuant to
the terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to such advancement of expenses, under this
Article V or otherwise shall be on the Corporation.
SECTION 5.4 NON-EXCLUSIVITY OF RIGHTS. The right to indemnification
and the advancement of expenses conferred in this Article V shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of the Certificate of Incorporation, provision of
these Bylaws, agreement, vote of stockholders or disinterested directors or
otherwise.
SECTION 5.5 INSURANCE. The Corporation may maintain insurance, at
its expense, to protect itself and any director, officer, employee or agent of
the Corporation or another corporation, partnership, joint venture, trust or
other enterprise against any expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the GCL.
SECTION 5.6 INDEMNIFICATION OF EMPLOYEES AND AGENTS OF THE
CORPORATION. The Corporation may, to the extent authorized from time to time by
the Board of Directors, grant rights to indemnification, and rights to the
advancement of expenses, to any employee or agent of the Corporation to the
fullest extent of the provisions of this Article V with respect to the
indemnification and advancement of expenses of directors and officers of the
Corporation.
SECTION 5.7 CONTRACT RIGHTS. The rights to indemnification and to
the advancement of expenses conferred in Section 5.1 and Section 5.2 shall be
contract rights and such rights shall continue as to an indemnitee who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the indemnitee's heirs, executors and administrators.
ARTICLE VI
COMMON STOCK
SECTION 6.1 CERTIFICATES. Certificates for stock of the Corporation
shall be in such form as shall be approved by the Board of Directors and shall
be signed in the name of the Corporation by the Chairman of the Board, if any,
or the President or a Vice President, and by the Treasurer or an Assistant
Treasurer, or the Secretary or an Assistant Secretary. Such certificates may be
sealed with the seal of the Corporation or a facsimile thereof. Any of or all
the signatures on a certificate may be a facsimile. In case any officer,
transfer agent or registrar who has signed or whose facsimile signature has been
placed upon a certificate shall have ceased to be such officer, transfer agent
or registrar before such certificate is issued, it may be issued by the
Corporation with the same effect as if he or she were such officer, transfer
agent or registrar at the date of issue.
SECTION 6.2 TRANSFERS OF STOCK. Transfers of stock shall be made
only upon the books of the Corporation by the holder, in person or by duly
authorized attorney, and on the surrender of the certificate or certificates for
the same number of shares, properly endorsed. The Board of Directors shall have
the power to make all such rules and regulations, not inconsistent with the
Certificate of Incorporation and these Bylaws and the GCL, as the Board of
Directors may deem appropriate concerning the issue, transfer and registration
of certificates for stock of the Corporation. The Board of Directors may appoint
one or more transfer agents or registrars of transfers, or both, and may require
all stock certificates to bear the signature of either or both.
SECTION 6.3 LOST, STOLEN OR DESTROYED CERTIFICATES. The Corporation
may issue a new stock certificate in the place of any certificate theretofore
issued by it, alleged to have been lost, stolen or destroyed, and the
Corporation may require the owner of the lost, stolen or destroyed certificate
or his or her legal representative to give the Corporation a bond sufficient to
indemnify it against any claim that may be made against it on account of the
alleged loss, theft or destruction of any such certificate or the issuance of
any such new certificate. The Board of Directors may require such owner to
satisfy other reasonable requirements as it deems appropriate under the
circumstances.
SECTION 6.4 STOCKHOLDER RECORD DATE. In order that the Corporation
may determine the stockholders entitled to notice of or to vote at any meeting
of stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock,
or for the purpose of any other lawful action, the Board of Directors may fix a
record date, which record date shall not precede the date on which the
resolution fixing the record date is adopted by the Board of Directors, and
which shall not be more than sixty nor less than ten (10) days before the date
of such meeting, nor more than sixty (60) days prior to any other action.
If no record date is fixed by the Board of Directors, (l) the record
date for determining stockholders entitled to notice of or to vote at a meeting
of stockholders shall be at the close of business on the day next preceding the
date on which notice is given, or, if notice is waived, at the close of business
on the day next preceding the day on which the meeting is held, (2) the record
date for determining stockholders entitled to express consent to corporate
action in writing without a meeting, when no prior action by the Board of
Directors is necessary, shall be at the close of business on the day on which
the first written consent is expressed by the filing thereof with the
Corporation as provided in Section 2.8 of these Bylaws, and (3) the record date
for determining stockholders for any other purpose shall be at the close of
business on the day on which the Board of Directors adopts the resolution
relating thereto.
A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; PROVIDED, HOWEVER, that the Board of Directors may fix a new record
date for the adjourned meeting.
Only such stockholders as shall be stockholders of record on the
date so fixed shall be entitled to notice of, and to vote at, such meeting and
any adjournment thereof, or to give such consent, or to receive payment of such
dividend or other distribution, or to exercise such rights in respect of any
such change, conversion or exchange of stock, or to participate in such action,
as the case may be, notwithstanding any transfer of any stock on the books of
the Corporation after any record date so fixed.
ARTICLE VII
SEAL
SECTION 7.1 SEAL. The seal of the Corporation shall be circular in
form and shall bear, in addition to any other emblem or device approved by the
Board of Directors, the name of the Corporation, the year of its incorporation
and the words "Corporate Seal" and "Delaware". The seal may be used by causing
it or a facsimile thereof to be impressed or affixed or in any other manner
reproduced.
ARTICLE VIII
WAIVER OF NOTICE
SECTION 8.1 WAIVER OF NOTICE. Whenever notice is required to be
given to any stockholder or director of the Corporation under any provision of
the GCL or the Certificate of Incorporation or these Bylaws, a written waiver
thereof, signed by the person or persons entitled to notice, whether before or
after the time stated therein, shall be deemed equivalent to the giving of such
notice. In the case of a stockholder, such waiver of notice may be signed by
such stockholder's attorney or proxy duly appointed in writing. Attendance of a
person at a meeting shall constitute a waiver of notice of such meeting, except
when the person attends a meeting for the express purpose of objecting at the
beginning of the meeting, to the transaction of any business because the meeting
is not lawfully called or convened. Neither the business to be transacted at,
nor the purpose of, any regular or special meeting of the stockholders,
directors or members of a committee of directors need be specified in any
written waiver of notice.
ARTICLE IX
CHECKS, NOTES, DRAFTS, ETC.
SECTION 9.1 CHECKS, NOTES, DRAFTS, ETC. Checks, notes, drafts,
acceptances, bills of exchange and other orders or obligations for the payment
of money shall be signed by such officer or officers or person or persons as the
Board of Directors or a duly authorized committee thereof may from time to time
designate.
ARTICLE X
AMENDMENTS
SECTION 10.1 AMENDMENTS. These Bylaws or any of them may be altered
or repealed, and new Bylaws may be adopted, by the stockholders by vote at a
meeting or by written consent without a meeting. The Board of Directors shall
also have power, by a majority vote of the Whole Board, to alter or repeal any
of these Bylaws, and to adopt new Bylaws.
EXHIBIT D
FROM TAX DEPARTMENT
CENTRAL AND SOUTH WEST CORPORATION
AND SUBSIDIARY COMPANIES
AGREEMENT FOR FILING CONSOLIDATED
FEDERAL INCOME TAX RETURN AND FOR
ALLOCATION OF CONSOLIDATED FEDERAL
INCOME TAX LIABILITIES AND BENEFITS
DATED APRIL 30, 1998
Central and South West Corporation, a registered public utility holding
company, and its Subsidiaries (collectively referred to as "the Parties") hereby
agree to annually join in the filing of a consolidated Federal income tax return
and to allocate the consolidated Federal income tax liabilities and benefits
among the members of the consolidated group in accordance with the provisions of
this Agreement.
1. PARTIES TO THE AGREEMENT
Federal Employer
Company and Address Identification Number
-------------------------------------------------------------------------
Central and South West Corporation 51-0007707
Dallas, Texas
Central Power and Light Company 74-0550600
Corpus Christi, Texas
Public Service Company of Oklahoma 73-0410895
Tulsa, Oklahoma
Southwestern Electric Power Company 72-0323455
Shreveport, Louisiana
West Texas Utilities Company 75-0646790
Abilene, Texas
Central and South West Services, Inc. 75-1296566
Dallas, Texas
CSW Leasing, Inc. 75-2013749
Dallas, Texas
CSW Credit, Inc. 75-2055555
Dallas, Texas
CSW Energy, Inc. 75-1901710
Dallas, Texas
CSW Power Marketing, Inc. 75-2696741
Dallas, Texas
Ash Creek Mining Company 73-1008093
Tulsa, Oklahoma
Southwest Arkansas Utilities Corp. 71-6052763
DeQueen, Arkansas
CSW Development-I, Inc. 75-2370921
Dallas, Texas
CSW Development-II, Inc. 75-2439272
Dallas, Texas
CSW Ft. Lupton, Inc. 75-2474488
Dallas, Texas
Noah I Power G.P., Inc. 33-0489753
Dallas, Texas
CSW Orange, Inc. 75-2505862
Dallas, Texas
CSW Communications, Inc. 75-2548781
Dallas, Texas
CSWC Southwest Holding, Inc. 74-2803758
Dallas, Texas
CSWC TeleChoice Management, Inc. 74-2803759
Dallas, Texas
CSWC TeleChoice, Inc. 74-2803760
Dallas, Texas
CSW International, Inc. 75-2569322
Dallas, Texas
CSW Mulberry, Inc. 75-2523281
Dallas, Texas
Newgulf Power Venture, Inc. 75-2562614
Dallas, Texas
CSW Nevada, Inc. 75-2562610
Dallas, Texas
Enershop, Inc. 75-2613053
Dallas, Texas
Envirothem 75-1797088
Dallas, Texas
CSW International (U.K.), Inc. 75-2638928
Dallas, Texas
CSW International Two, Inc. 75-2638929
Dallas, Texas
CSW International Three, Inc. 75-2638930
Dallas, Texas
CSW Mulberry II, Inc. 75-2562612
Dallas, Texas
CSW Orange II, Inc. 75-2562609
Dallas, Texas
CSW Development-3, Inc. 75-2638922
Dallas, Texas
CSW Northwest GP, Inc. 75-2638926
Dallas, Texas
CSW Northwest LP, Inc. 75-2638925
Dallas, Texas
CSW Sweeny GP I, Inc. 75-2627173
Dallas, Texas
CSW Sweeny GP II, Inc. 75-2627175
Dallas, Texas
CSW Sweeny LP I, Inc. 75-2627176
Dallas, Texas
CSW Sweeny LP II, Inc. 75-2627177
Dallas, Texas
CSW Energy Services, Inc. 75-2730186
Dallas, Texas
CSW Services International, Inc. 75-2747384
Dallas, Texas
Latin American Energy Holding, Inc. 75-2731945
Dallas, Texas
2. DEFINITIONS
"CONSOLIDATED TAX" is the aggregate current Federal income tax liability
for a tax year, being the tax shown on the consolidated Federal income tax
return and any adjustments thereto.
"CORPORATE TAXABLE INCOME" is the taxable income of a subsidiary company
for a tax year, computed as though such company had filed a separate
return on the same basis as used in the consolidated return, except that
dividend income from subsidiary companies shall be disregarded, and other
intercompany transactions, eliminated in consolidation, shall be given
appropriate effect.
"CORPORATE TAXABLE LOSS" is the taxable loss of a subsidiary company for a
tax year, computed as though such company had filed a separate return on
the same basis as used in the consolidated return, except that dividend
income from subsidiary companies shall be disregarded, and other
intercompany transactions, eliminated in consolidation, shall be given
appropriate effect.
These definitions shall apply, as appropriate, in the context of the
Alternative Minimum Tax ("AMT").
3. TAX ALLOCATION PROCEDURES
The consolidated tax shall be allocated among the members of the group
consistent with Rule 45(c) of the Public Utility Holding Company Act of
1935, utilizing the "separate return corporate taxable income" method, in
the following manner:
(a) Intercompany transactions eliminated by consolidation entries
which affect the consolidated taxable income will be restored to the
appropriate member for the purpose of computing separate return
corporate taxable income or loss.
(b) The consolidated regular tax, exclusive of the AMT & Foreign Tax
Credit ("FTC") and calculated prior to the reduction for any credits
including the AMT & FTC credit, will be allocated among the members
of the group based on the ratio of each member's separate return
corporate taxable income to the total separate return corporate
taxable income.
(c) The consolidated AMT and the Environmental Tax will be allocated
among the members of the group based on the ratio of each member's
separate return corporate Alternative Minimum Taxable Income
("AMTI") to the total separate corporate return AMTI.
(d) With the exception of the parent corporation, each member of the
group having a separate return corporate taxable loss will be
included in the allocation of the regular consolidated tax. Such
loss members will receive current payment for the reduction in the
regular consolidated tax liability resulting from the inclusion of
the losses of such members in the consolidated return.
Any regular tax savings in consolidation will be allocated to the
members of the group having separate return corporate taxable income
as provided in sub-section (b). If the aggregate of the member's
separate return corporate taxable losses are not entirely utilized
on the current year's consolidated return, the consolidated
carry-back to the applicable prior tax year(s) will be allocated in
accordance with section 6.
(e) The tax allocated to any member of the group shall not exceed
the separate return tax of such member.
(f) General business credits, other tax credits and capital losses
shall be equitably allocated to those members whose investments or
contributions generated the credit or capital loss.
If the credit or capital loss can not be entirely utilized to offset
consolidated tax, the credit or capital loss carryover shall be
equitably allocated on a separate return basis to those members
whose investments or contributions generated the credit or capital
loss.
(g) In the event a portion of the consolidated AMT is not allocable
to members because of the limitation in sub-section (e), the parent
corporation will pay the unallocated AMT. Such unallocated AMT will
be carried forward, and, if appropriate, allocated to applicable
members in subsequent taxable years to the extent allowed under
sub-section (e). If any remaining unallocated AMT is recovered on a
consolidated basis in a subsequent year by the reduction of the
consolidated regular tax by the AMT credit, the parent corporation
will receive the entire tax benefit of such recovery until the
unallocated AMT is eliminated.
4. EXCLUDED SUBSIDIARY COMPANIES
Prior to the 1991 tax year, CSW Leasing, Inc. and CSW Energy, Inc. were
excluded from the tax allocation pursuant to Rule 45(c)(4) and the tax
benefits attributable to such companies' losses and credits were allocated
to the parent corporation. These excluded companies retain separate return
carryover rights for the losses and credits availed of by the parent
corporation through the consolidated return. On future consolidated tax
allocations, the parent corporation shall pay such companies for the
previously allocated tax benefits to the extent the companies are able to
offset separate return corporate taxable income with such carryovers.
5. PARENT CORPORATION LOSS
Any regular tax savings in consolidation from the parent corporation,
excluding the effects of extraordinary items, shall be allocated to those
members which have separate return corporate taxable income in the same
manner as the consolidated tax is allocated. Members having a separate
return corporate taxable loss will not participate in the allocation of
the parent company loss.
6. TAX ADJUSTMENTS
In the event the consolidated tax liability is subsequently revised by
Internal Revenue Service audit adjustments, amended returns, claims for
refund, or otherwise, such changes shall be allocated in the same manner
as though the adjustments on which they are based had formed part of the
original consolidated return.
7. EFFECTIVE DATE
This Agreement is effective for the allocation of the current Federal
income tax liabilities of the Parties for the tax year 1997 and all
subsequent years until this Agreement is revised in writing.
8. APPROVAL
This Agreement is subject to the approval of the Securities and Exchange
Commission. A copy of this Agreement will be filed as an exhibit to the
Form U5S Annual Report to the Securities and Exchange Commission by
Central and South West Corporation for the year ended December 31, 1997.
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the undersigned, duly authorized, have signed this Agreement on behalf of
the Parties indicated.
Central and South West Corporation
By /s/ Lawrence B. Connors
----------------------------------------------
Lawrence B. Connors, Controller
Central and South West Services, Inc.
By /s/ E.R. Brooks
----------------------------------------------
Chairman and Chief Executive Officer
Central Power and Light Company
By /s/ M. Bruce Evans
----------------------------------------------
President
Public Service Company of Oklahoma
By /s/ T.D. Churchwell
----------------------------------------------
President
Southwestern Electric Power Company
By /s/ Michael D. Smith
----------------------------------------------
President
West Texas Utilities Company
By /s/ Floyd W. Nickerson
----------------------------------------------
President
CSW Mulberry, Inc.
CSW Mulberry II, Inc.
Newgulf Power Venture, Inc.
CSW Nevada, Inc.
CSW Energy, Inc.
CSW Development-I, Inc.
CSW Development-II, Inc.
CSW Development-3, Inc.
CSW Ft. Lupton, Inc.
Noah I Power G.P., Inc.
CSW Orange, Inc.
CSW Orange II, Inc.
CSW Northwest GP, Inc.
CSW Northwest LP, Inc.
CSW Sweeny GP I, Inc.
CSW Sweeny GP II, Inc.
CSW Sweeny LP I, Inc.
CSW Sweeny LP II, Inc.
By /s/ Terry D. Dennis
----------------------------------------------
President and Chief Executive Officer
CSW Credit, Inc.
By /s/ Glenn D. Rosilier
----------------------------------------------
President
CSW Leasing, Inc.
By /s/ Glenn D. Rosilier
----------------------------------------------
President
CSW Energy Services, Inc.
Enershop, Inc.
Envirothem
By /s/ Richard H. Bremer
----------------------------------------------
President
Ash Creek Mining Company
By /s/ E. Michael Williams
----------------------------------------------
President
Southwest Arkansas Utilities Corporation
By /s/ Thomas H. DeWeese
----------------------------------------------
President
CSW Communications, Inc.
CSWC Southwest Holding, Inc.
CSWC TeleChoice Management, Inc.
CSWC TeleChoice, Inc.
By /s/ Donald A. Shahan
----------------------------------------------
President
CSW Services International, Inc.
CSW International, Inc.
CSW International (U.K.), Inc.
CSW International Two, Inc.
CSW International Three, Inc.
Latin American Energy Holdings, Inc.
By /s/ Terry D. Dennis
----------------------------------------------
President
CSW Power Marketing, Inc.
By /s/ Terry D. Dennis
----------------------------------------------
President
ENVIRONMENTAL LABORATORY ANALYSIS
1997
Dolet Hills Mining Venture $35,442
Sabine Mining Company 32,810
General Electric Company 1,820
PMI, Inc., Environmental Services 1,475
Miscellaneous (less than $500) 665
------
$72,212
======
CSW EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION COMMITTEE REPORT
CSW's executive compensation program has as its foundation the following
objectives:
- Maintaining a total compensation program consisting of base salary,
performance incentives and benefits designed to support the corporate goal
of providing superior value to CSW stockholders and customers;
- Providing comprehensive programs which serve to facilitate the
recruitment, retention and motivation of qualified executives; and
- Rewarding key executives for achieving financial, operating and individual
objectives that produce a corresponding and direct return to CSW's
stockholders in both the long-term and the short-term.
The Executive Compensation Committee which consists of six independent
outside directors, has designed CSW's executive compensation programs around a
strong pay-for-performance philosophy. The Executive Compensation Committee
strives to maintain competitive levels of total compensation as compared to
peers in the utility industry.
Each year, the Executive Compensation Committee conducts a comprehensive
review of CSW's executive compensation programs. The Executive Compensation
Committee is assisted in these efforts by an independent consultant and by CSW's
internal staff, who provide the Executive Compensation Committee with relevant
information and recommendations regarding the compensation policies, programs
and specific compensation practices. This review is designated to ensure that
the programs are in place to enable CSW to achieve its strategic and operating
objectives and provide superior value to its stockholders and customers, and to
document CSW's relative competitive position.
The Executive Compensation Committee reviews a comparison of CSW's
compensation programs with those offered by comparable companies within the
utility industry. For each component of compensation, as well as total
compensation, the Executive Compensation Committee seeks to ensure that CSW's
level of compensation for CSW's expected level of performance approximates the
average or mean for executive officers in similar positions at comparable
companies. In most years, this means that the level of total compensation for
expected performance will be near the average for comparable companies.
Performance above or below expected levels is reflected in a corresponding
increase or reduction in the incentive portion of the compensation program.
The amounts of each of the primary components of executive
compensation--salary, annual incentive plan awards and long-term incentive plan
awards--will fluctuate according to individual, business unit, and/or corporate
performance. Corporate performance for these purposes is measured against a peer
group of selected companies in the utility industry (the "Utility Peer Group").
The Utility Peer Group consists of the companies listed in the S&P Electric
Utility index as well as large regional competitors. The Executive Compensation
Committee believes that using the S&P Electric Utility index provides an
objective measure to compare performance benchmarks appropriate for compensation
purposes.
CSW's executive compensation program includes several components serving
long and short-term objectives. CSW provides its senior executive officers with
benefits under the SERP and all executive officers with certain executives
perquisites (as noted elsewhere in this Joint Proxy Statement/Prospectus.) In
addition, CSW maintains for each of its executive officers a package of benefits
under its pension and welfare benefit plans that are generally provided to all
employees, including group health, life, disability and accident insurance
plans, tax-advantaged reimbursement accounts, a defined benefit pension plan and
the 401(k) savings plan.
The following describes the relationship of compensation to performance for
the principal components of executive officer compensation:
BASE SALARY: Each executive officer's corporate position is matched to a
comparable position within the utility Industry and is valued at the 50th
percentile market level. In some cases, these positions are common in both the
utility industry as well as general industry. In these cases, comparisons are
made to both markets. Once these market values are determined, the position is
then evaluated based on the position's overall contribution to corporate goals.
This internal weighting is combined with the value the market places on the
associated job responsibilities and a salary is assigned to that position. Each
year the assigned values are reviewed against market conditions, including
compensation practices in the Utility Peer Group, inflation, and supply and
demand in the labor markets. If these conditions change significantly there may
be an adjustment to base salary. Finally, the results of the executive officers'
performance over the past year becomes part of the basis of the Executive
Compensation Committee's decision to approve, at its discretion, base salaries
of executive officers. After a review of the data and other factors influencing
corporate results, the salaries of the Chairman and his direct reports were not
adjusted during 1997.
INCENTIVE PROGRAMS--GENERAL: The executive incentive programs are designed
to strike an appropriate balance between short-term accomplishments and CSW's
need to effectively plan for and perform over the long-term.
INCENTIVE PROGRAMS--ANNUAL INCENTIVE PLAN: The Central and South West
Corporation Annual Incentive Plan (the "AIP") is a short-term bonus plan
rewarding annual performance. AIP awards are determined under a formula that
directly ties the amount of the award with levels of achievement for specific
individual, business unit and corporate performance. The amount of an executive
officer's AIP award equals the sum of the corporate and business unit results
times their individuals rating times their target award. In addition, the
executive's award calculation is weighted 80 percent on corporate results and 20
percent on business unit results. The award can vary from 0 to a maximum of 150
percent of target.
The corporate performance is currently determined by two equally weighted
measures--earnings per share and cash flow. Threshold, target and exceptional
levels of performance are set by the Executive Compensation Committee in the
first quarter of each year. The Executive Compensation Committee considers both
historic performance and budgeted or expected levels of performance in setting
these targets.
Performance for a given business unit represents the weighted average of
performance indices that measure the achievement of specific financial and/or
operational goals that are set and weighted at the beginning of the year for
that business unit.
The individual performance represents the average of results achieved on
several individual goals and a subjective evaluation of overall job performance.
Although individual performance goals do not repeat corporate performance
measures, these goals are constructed to support departmental, work team or
business unit performance which links to corporate performance goals or
initiative. If an individual fails to achieve a minimum threshold performance
level on individual performance goals, that individual does not earn an AIP
award for that year.
Target awards for executive officers have been fixed at 50 percent of salary
for the chief executive officer, 45 percent of salary for senior vice
presidents, and business unit presidents and 35 percent of salary for other
officers. The corresponding maximum AIP award that can be earned by the
executive based on position is 1.5 times the target award. These targets are
established by a review of competitive practice among the Utility Peer Group.
Performance under the AIP is measured or reviewed by each executive
officer's superior officer, or in the case of the chief executive officer by the
Executive Compensation Committee, with the assistance of internal staff. The
results are reviewed and are subject to approval by the Executive Compensation
Committee. Under the terms of the AIP, the Executive Compensation Committee in
the exercise of its discretion, may vary corporate or company performance
measures in the form of payment for AIP awards from year-to-year prior to
establishing the awards, including payment in cash or restricted stock, as
determined by the Executive Compensation Committee.
In 1997, AIP awards were determined based on the corporate performance
index, the business unit company performance index and the individual
performance index. As permitted by the AIP, the Executive Compensation Committee
granted a limited number of awards to recognize key individuals who provided
vision and strategic leadership.
INCENTIVE PROGRAMS--LONG-TERM INCENTIVE PLAN: Amounts realized by CSW's
executive officers under awards made pursuant to the CSW Incentive Plan depend
entirely upon corporate performance. The Executive Compensation Committee
selects the form and amount of CSW Incentive Plan awards based upon its
evaluation of which vehicles are best positioned to serve as effective
incentives for long-term performance.
Since 1992, the Executive Compensation Committee has established CSW
Incentive Plan awards in the form of performance shares. These awards provide
incentives both for exceptional corporate performance and retention. Each year,
the Compensation Committee has set a target award of a specified dollar amount
for each awardee based on a percentage of salary. The dollar amount
corresponding to the target award is divided by the per share market price of
CSW's common stock on the date the award is established to derive the number of
shares of such stock that will be issued if target performance is achieved by
CSW.
The payout of such an CSW Incentive Plan award is based upon a comparison of
CSW's total stockholder return over a three-year period, or "cycle," against
total stockholder returns of utilities in the Utility Peer Group over the same
three-year period. Total stockholder return is calculated by dividing (i) the
sum of (A) the cumulative amount of dividends per share for the three-year
period, assuming full dividend reinvestment, and (B) the change in share price
over the three-year period, by (ii) the share price at the beginning of the
three-year period. If CSW's total stockholder return for a cycle falls in one of
the top three quartiles of similarly calculated total stockholder returns
achieved at companies in the Utility Peer Group, CSW will make a payout to
participants for the three-year cycle then ending. First, second and third
quartile performance will result in payouts of 150 percent, 100 percent and 50
percent of target, respectively. Performance in the fourth quartile yields no
payout under the CSW Incentive Plan.
Each year since the inception of the CSW Incentive Plan, a new three-year
performance cycle has been established. In January 1997, the Executive
Compensation Committee evaluated the 1994-1996 cycle performance under the CSW
Incentive Plan and because results were below the threshold for a payout, no
awards were granted. In January 1998, the Committee reviewed total stockholder
return results for the period covering 1995-1997, and because performance was in
the third quartile, granted restricted stock awards at 50 percent of target.
CSW from time to time has also granted stock options and restricted stock
under the CSW Incentive Plan. Stock options and restricted stock are granted at
the discretion of the Executive Compensation Committee. Stock options, once
vested, allow grantees to buy specified numbers of shares of CSW common stock at
a specified stock price, which to date has been the market price on the date of
grant. In determining grants to date, the Executive Compensation Committee has
considered both the number and value of options granted by companies in the
Utility Peer Group with respect to both the number and value of options awarded
by CSW, and the relative amounts of other long-term incentive awards at CSW and
such peers. The executive officers' realization of any value on the options
depends upon stock appreciation. In May 1997, a stock option grant was approved
at the market price of $20.75 per share to provide the opportunity for more
equity ownership and to provide immediate focus to our executives on CSW
strategic initiatives. No executive officer owns in excess of one percent of
CSW's common stock. Further, the amounts of CSW Incentive Plan awards are
measured against similar practices of other companies in the Utility Peer Group.
TAX CONSIDERATIONS: Section 162(m) of the Code generally limits CSW's
federal income tax deduction for compensation paid in any taxable year to any
one of the five highest paid executive officers named in CSW's proxy statement
to $1 million. The limit does not apply to specified types of payments,
including, most significantly, payments that are not includible in the
employee's gross income, payments made to or from a tax-qualified plan, and
compensation that meets the Code's definition of performance-based compensation.
Under the Code, the amount of a performance-based incentive award must be based
entirely on an objective formula, without any subjective consideration of
individual performance, to be considered performance-based.
The Executive Compensation Committee has carefully considered the impact of
this law. At this time, the Executive Compensation Committee believes it is in
CSW's and stockholder's best interests to retain the subjective determination of
individual performance under the AIP. Consequently, payments under the AIP, if
any, to the named executive officers may be subject to the limitation imposed by
section 162(m) of the Code. In 1997, stockholders approved a restatement and
requalification of the CSW Incentive Plan for purposes of satisfying Section
162(m).
RATIONALE FOR CEO COMPENSATION
In 1997, Mr. Brooks' compensation was determined as described above for all
of CSW's executive officers.
Mr. Brooks' annual salary is currently $700,000. The Executive Compensation
Committee reviewed Mr. Brooks' salary as a part of its overall annual review of
executive compensation. His salary is based on market information for similar
positions as well as salaries of chief executive officers at comparable regional
utilities (not limited to the Utility Peer Group).
Mr. Brooks' target AIP award for 1997 was 50 percent of his salary. As
permitted by the AIP, for 1997, the Executive Compensation Committee approved an
award in the amount of $450,000 to recognize Mr. Brooks' significant vision and
strategic leadership.
After a review of the results of the 1995-1997 cycle of the CSW Incentive
Plan, the Executive Compensation Committee approved an award in the amount of
8,157 shares of restricted stock recognizing total shareholder return
performance in the third quartile, or fifty percent of target, which vest fifty
percent in January 1999 and fifty percent in January 2000.
In 1997 the Executive Compensation Committee established Mr. Brooks' target
award for the CSW Incentive Plan for the 1997-1999 cycle of $490,000 to be paid
in shares of restricted stock in 1999 if performance measures are met. Mr
Brooks' target amount was derived by reference to the number and value of grants
to chief executive officers at comparable companies.
EXECUTIVE COMPENSATION COMMITTEE
Joe H. Foy, Chairman
Molly Shi Boren
William R. Howell
Robert W. Lawless
Richard L. Sandor
Lloyd D. Ward
CASH AND OTHER FORMS OF COMPENSATION. The following table sets forth the
aggregate cash and other compensation for services rendered for the fiscal years
of 1997, 1996, and 1995 paid or awarded by CSW to its chief executive officer
and each of the four most highly compensated executive officers ( the "Named
Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
AWARDS
OTHER -------------------------- PAYOUTS
ANNUAL RESTRICTED SECURITIES -----------------
COMPEN- STOCK UNDERLYING CSW INCENTIVE
NAME AND SALARY BONUS SATION AWARD(S) OPTIONS/ PLAN PAYOUTS
PRINCIPAL POSITION YEAR ($) ($)(1) ($) ($)(1)(2) SARS(#) ($)
- - -------------------------------- --------- --------- --------- ----------- ----------- ------------------------------
E.R. Brooks..................... 1997 699,999 375,200 14,723 -- 65,000 --
Chairman and Chief Executive 1996 657,692 374,354 22,267 417,688 -- --
Officer 1995 628,847 162,739 25,149 -- -- --
T.V. Shockley, III.............. 1997 490,000 215,662 4,325 -- 41,000 --
President and Chief Operating 1996 435,212 242,565 10,746 248,563 -- --
Officer 1995 406,870 105,448 8,441 -- -- --
Glenn Files..................... 1997 374,999 143,099 8,534 -- 31,000 --
Senior Vice President, 1996 331,135 44,860 66,415 153,750 -- --
Electric Operations 1995 266,223 85,048 19,144 -- -- --
Ferd. C. Meyer, Jr.............. 1997 345,051 157,157 3,950 -- 29,000 --
Executive Vice President and 1996 345,051 209,898 8,910 194,750 -- --
General Counsel 1995 336,547 86,444 12,354 -- -- --
Glenn D. Rosilier............... 1997 334,751 161,055 3,594 -- 28,000 --
Executive Vice President and 1996 334,751 209,898 10,331 194,750 -- --
Chief Financial Officer 1995 326,500 86,444 6,706 -- -- --
<CAPTION>
<S> <C>
ALL OTHER
COMPEN-
NAME AND SATION
PRINCIPAL POSITION ($)(3)
- - -------------------------------- -----------
E.R. Brooks..................... 23,757
Chairman and Chief Executive 23,992
Officer 23,956
T.V. Shockley, III.............. 23,757
President and Chief Operating 21,742
Officer 21,706
Glenn Files..................... 23,757
Senior Vice President, 23,992
Electric Operations 23,117
Ferd. C. Meyer, Jr.............. 21,307
Executive Vice President and 21,742
General Counsel 21,706
Glenn D. Rosilier............... 23,757
Executive Vice President and 23,992
Chief Financial Officer 23,019
</TABLE>
- - ------------------------
(1) Amounts in these columns are paid or awarded in a calendar year for
performance in a preceding year.
(2) Grants of restricted stock are administered by the Executive Compensation
Committee of the CSW Board of Directors, which has the authority to
determine the individuals to whom and the terms upon which restricted stock
grants, including the number of underlying shares, shall be made. The awards
reflected in this column all have four-year vesting periods with 25% vesting
on the first, second, third and fourth anniversary dates of the award. Upon
vesting, CSW Shares are re-issued without restrictions. The individual
receives dividends and may vote shares of restricted stock, even before they
are vested. The amount reported in the table represents the market value of
the shares at the date of grant. As of December 31, 1997, the aggregate
restricted stock holdings of each of the Named Executive Officers were:
<TABLE>
<CAPTION>
RESTRICTED STOCK HELD MARKET VALUE AT
AT DECEMBER 31, 1997 DECEMBER 31, 1997
--------------------- -----------------
<S> <C> <C>
E. R. Brooks.............. 12,225 $ 330,839
T. V. Shockley............ 7,275 $ 196,880
Glenn Files............... 4,500 $ 121,781
Ferd. C. Meyer, Jr........ 5,700 $ 154,256
Glenn Rosilier............ 5,700 $ 154,256
</TABLE>
(3) Amounts shown in this column consist of (i) the annual employer matching
payments to CSW's Retirement Savings Plan, (ii) premiums paid per
participant for personal liability insurance and (iii) average amounts of
premiums paid per participant in those years under CSW's memorial gift
program. See "--Meetings and Compensation of the CSW Board of Directors" for
a description of CSW's memorial gift program.
OPTION/SAR GRANTS. Shown below is information on grants of stock options
made in 1997 pursuant to the CSW Incentive Plan to the Named Executive Officers.
No stock appreciation rights were granted in 1997.
CSW OPTION/SAR GRANTS IN 1997(1)
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF CSW
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERMS(3)
----------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
NUMBER OF CSW % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED(#)(2) FISCAL YEAR ($/SH) DATE 5%($) 10%($)
- - --------------------- ----------------- ----------------- ----------- ----------- --------- ----------
E. R. Brooks......... 65,000 9.4 20.750 5/23/2007 849,713 2,144,513
T. V. Shockley, III.. 41,000 6.0 20.750 5/23/2007 535,973 1,352,693
Glenn Files.......... 31,000 4.5 20.750 5/23/2007 405,248 1,022,768
Ferd. C. Meyer, Jr... 29,000 4.2 20.750 5/23/2007 379,103 956,753
Glenn D. Rosilier.... 28,000 4.1 20.750 5/23/2007 366,030 923,790
</TABLE>
- - ------------------------
(1) The stock option plans are administered by the Executive Compensation
Committee of the CSW Board of Directors, which has the authority to
determine the individuals to whom and the terms upon which option and SAR
grants shall be made.
(2) All options were granted on May 23, 1997, and are first exercisable 12
months after the grant date, with one-third of the shares becoming
exercisable at that time and with an additional one third of the aggregate
becoming exercisable on each of the next two anniversary dates.
(3) The annual rates of appreciation of 5% and 10% are specifically required by
SEC disclosure rules and in no way guarantee that such annual rates of
appreciation will be achieved by CSW nor should this be construed in any way
to constitute any representation by CSW that such growth will be achieved.
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE. Shown below is information
regarding option/SAR exercises during 1997 and unexercised options/SARs at
December 31, 1997 for the Named Executive Officers.
AGGREGATED OPTION/SAR EXERCISES IN 1997
AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF
UNDERLYING UNEXERCISED IN-THE-MONEY
VALUE OPTIONS/SARS AT YEAR-END OPTIONS/SARS AT YEAR-END
SHARES ACQUIRED REALIZED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) ($) UNEXERCISABLE UNEXERCISABLE(1)
- - --------------------- ------------------- ----------- ------------------------ ------------------------
<S> <C> <C> <C> <C>
E. R. Brooks......... -- -- 65,175/65,000 9,007/410,313
T. V. Shockley, III.. -- -- 42,231/41,000 5,837/258,813
Glenn Files.......... -- -- 23,653/31,000 5,593/195,688
Ferd. C. Meyer, Jr... -- -- 32,889/29,000 4,547/183,063
Glenn D. Rosilier.... -- -- 32,889/28,000 4,547/176,750
</TABLE>
- - ------------------------
(1) Calculated based upon the difference between the closing price of CSW's
Shares on the NYSE on December 31, 1997 ($27.0625 per share) and the
exercise price per share of the outstanding unexercisable and exercisable
options ($20.750, $24.813 and $29.625, as applicable).
LONG-TERM INCENTIVE PLAN AWARDS IN 1997. The following table shows
information concerning awards made to the Named Executive Officers during 1997
under the CSW Incentive Plan:
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS UNDER
PERFORMANCE OR NON-STOCK PRICE BASED PLANS
NUMBER OF OTHER PERIOD -------------------------------------
SHARES, UNITS OR UNTIL MATURATION THRESHOLD TARGET MAXIMUM
NAME OTHER RIGHTS OR PAYOUT ($) ($) ($)
- - --------------------- ------------------- ---------------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C>
E. R. Brooks......... -- 2 years -- 490,000 735,000
T. V. Shockley, III.. -- 2 years -- 294,000 441,000
Glenn Files.......... -- 2 years -- 225,000 337,500
Ferd. C. Meyer, Jr... -- 2 years -- 207,030 310,545
Glenn D. Rosilier.... -- 2 years -- 200,850 301,275
</TABLE>
Payouts of the awards are contingent upon CSW's achieving a specified level
of total stockholder return, relative to the S&P Electric Index, for a
three-year period, or cycle, and exceeding a certain defined minimum threshold.
If the Named Executive Officer's employment is terminated during the performance
period for any reason other than death, total and permanent disability or
retirement, then the award is canceled. The CSW Incentive Plan contains a
provision accelerating awards upon a change in control of CSW. Except as
provided in the next sentence, if a change in control of CSW occurs, all options
become fully exercisable and all restrictions, terms and conditions applicable
to all restricted stock are deemed lapsed and satisfied and all performance
units are deemed to have been fully earned, as of the date of the change in
control. Awards which have been outstanding for less than six months prior to
the date the change in control occurs are not subject to acceleration upon the
occurrence of a change in control. The CSW Incentive Plan also contains
provisions designed to prevent circumvention of the above acceleration
provisions through coerced termination of an employee prior to a change in
control. See "Executive Compensation Committee Report" for a more thorough
discussion of the terms of the CSW Incentive Plan.
RETIREMENT PLAN. CSW maintains the tax-qualified CSW Cash Balance Plan for
eligible employees. In addition, CSW maintains the SERP, a non-qualified ERISA
excess plan, that primarily provides benefits that cannot be payable under the
CSW Cash Balance Plan because of maximum limitations imposed on such plans by
the Code.
Through June 30, 1997, the CSW Cash Balance Plan was structured as a
traditional, defined benefit final average pay plan. Effective July 1, 1997, the
present value of accrued benefits under the Retirement Plan was converted to a
cash balance.
Under the cash balance formula, each participant has an account, for
recordkeeping purposes only, to which credits are allocated annually based on a
percentage of the participant's pay. As of July 1, 1997, the definition of pay
for the CSW Cash Balance Plan was expanded to include not only base pay but also
bonuses, overtime, and commissions. The applicable percentage is determined by
the age and years of vesting service the participant has with CSW and its
affiliates as of December 31 of each year (or as of the participant's
termination date, if earlier). The following table shows the applicable
percentage used to determine credits at the age and years of service indicated:
<TABLE>
<CAPTION>
SUM OF AGE
PLUS
YEARS OF
SERVICE APPLICABLE PERCENTAGE
- - -------------- ---------------------
<S> <C>
less than 30 3.0%
30-39 3.5%
40-49 4.5%
50-59 5.5%
60-69 7.0%
70 or more 8.5%
</TABLE>
As of December 31, 1997, the sum of age plus years of service of the Named
Executive Officers for the cash balance formula are as follows: Mr. Brooks, 96;
Mr. Shockley, 73; Mr. Files, 76; Mr. Meyer, 74; and Mr. Rosilier, 71.
All balances in the accounts of participants earn a fixed rate of interest
which is also credited annually. The interest rate for a particular year is the
average rate of return of the 30-year Treasury Rate for November of the prior
year. For 1997, the interest rate was 6.48%. For 1998, the interest rate is
6.11%. Interest continues to be credited as long as the participant's balance
remains in the plan.
At retirement or other termination of employment, an amount equal to the
vested balance (including qualified and SERP benefit) then credited to the
account is payable to the participant in the form of an immediate or deferred
lump-sum or annuity. Benefits (both from the CSW Cash Balance Plan and the SERP)
under the cash balance formula are not subject to reduction for Social Security
benefits or other offset amounts. The estimated annual benefit payable to each
of the Named Executive Officers as a single life annuity at age 65 under the CSW
Cash Balance Plan and the SERP is; Mr. Brooks, $464,599; Mr. Shockley, $230,384;
Mr. Meyer, $144,432; Mr. Rosilier, $250,142; Mr. Files, $272,378. These
projections are based on the following assumptions: (1) participant remains
employed until age 65; (2) salary used is base pay paid for calendar year 1997
assuming no future increases plus bonus at 1997 target level; (3) interest
credit at 6.11% for 1998 and future years; (4) the conversion of the lump-sum
cash balance to a single life annuity at normal retirement age, based on an
interest rate of 6.11% and the 1983 Group Annuity Mortality Table, which sets
forth generally accepted life expectancies.
In addition, certain employees who were 50 or over and had completed at
least 10 years of service as of July 1, 1997, also continue to earn a benefit
using the prior pension formula. At commencement of benefits, the following
Named Executive Officers have a choice of their accrued benefit using the cash
balance formula or their accrued benefit using the prior pension formula: Mr.
Brooks, Mr. Shockley, and Mr. Meyer. Once the participant selects either the
earned benefit under the cash balance formula or the earned benefit under the
prior pension formula, the other earned benefit is no longer available.
The table below shows the estimated combined benefits payable from both the
prior pension formula and the SERP based on retirement age of 65, the average
compensation shown, the years of credited service shown, continued existence of
the prior pension formula without substantial change and payment in the form of
a single life annuity.
<TABLE>
<CAPTION>
ANNUAL BENEFITS AFTER
SPECIFIED YEARS OF CREDITED SERVICE
-----------------------------------------------
AVERAGE COMPENSATION 15 20 25 30 OR MORE
- - -------------------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
$ 250,000 $ 62,625 $ 83,333 $ 104,167 $ 125,000
$ 350,000 $ 87,675 $ 116,667 $ 145,833 $ 175,000
$ 450,000 $ 112,725 $ 150,000 $ 187,500 $ 225,000
$ 550,000 $ 137,775 $ 183,333 $ 229,167 $ 275,000
$ 650,000 $ 162,825 $ 216,667 $ 270,833 $ 325,000
$ 750,000 $ 187,875 $ 250,000 $ 312,500 $ 375,000
$ 850,000 $ 212,500 $ 283,333 $ 357,000 $ 425,000
</TABLE>
Benefits payable under the prior pension formula are based upon the
participant's years of credited service, age at retirement, and covered
compensation earned by the participant. The annual normal retirement benefit
payable under the prior pension formula and the SERP are based on 1.67 percent
of "Average Compensation" times the number of years of credited service (reduced
by no more than 50 percent of a participant's age 62 or later Social Security
benefit). "Average compensation" is covered compensation for the prior pension
formula and equals the average annual compensation, reported as salary in the
Summary Compensation Table, during the 36 consecutive months of highest pay
during the 120 months prior to retirement.
Respective years of credited service and ages, as of December 31, 1997, for
the three Named Executive Officers who continue to earn a benefit under the
prior pension formula are: Mr. Brooks, 30 and 60; Mr. Shockley, 14 and 52; and
Mr. Meyer, 16 and 58.
In addition, Mr. Shockley and Mr. Meyer have arrangements with CSW under
which they will receive a total of 30 years of credited service using the prior
pension formula (paid through the SERP) if they remain employed by CSW through
age 60. In 1992, Mr. Meyer completed five consecutive years of employment which
entitled him to receive five additional years of credited service (through the
SERP) as included in his years of service for the cash balance formula and the
prior pension formula as set forth above.
MEETINGS AND COMPENSATION OF THE CSW BOARD
The CSW Board held 6 regular meetings and 8 special meetings during 1997.
Directors who are not also officers and employees of CSW receive annual cash
directors' fees of $12,000 for serving on the CSW Board and a fee of $1,250 per
day plus expenses for each meeting of the CSW Board or committee attended. In
addition, under the CSW Directors' Plan each non-employee director receives an
annual award of 600 phantom stock shares on the fourth Wednesday of January
during their term of office. Such phantom stock shares vest at such time as a
director ceases to be a member of the CSW Board and are then converted into CSW
Shares on a one-for-one basis. The CSW Board has standing Policy, Audit,
Executive Compensation, Nominating and Corporate Strategy Review Committees.
Chairmen of the Audit, Corporate Strategy Review, Executive Compensation, and
Nominating Committees receive annual fees of $6,000, $6,000, $3,500 and $3,500,
respectively, to be paid in cash in addition to regular directors'
and meeting fees. Committee chairmen and committee members who are also officers
and employees of CSW receive no annual director's, chairman's or meeting fees.
CSW maintains a memorial gift program for all of its current directors,
directors who have retired since 1992 and certain executive officers. There are
14 current directors and executive officers and 13 retired directors and
officers eligible for the memorial gift program. Under this program, CSW will
make donations in a director's or executive officer's name to up to three
charitable organizations in an aggregate of $500,000, payable by CSW upon such
person's death. CSW maintains corporate-owned life insurance policies to fund
the program. The annual premiums paid by CSW are based on pooled risks and
averaged $15,803 per participant for 1997, $16,402 per participant for 1996, and
$16,367 per participant for 1995.
Non-employee directors are provided the opportunity to enroll in a medical
and dental program offered by CSW. This program is identical to the employee
plan and directors who elect coverage pay the same premium as active employee
participants in the plan. If a non-employee director terminates his service on
the board with ten or more years of service and is over seventy years of age,
that director is eligible to receive retiree medical and dental benefits
coverage from CSW.
Non-employee directors are provided the opportunity to participate in the
Central and South West Deferred Compensation Plan for Directors. The plan allows
participants to defer up to $20,000 of board and committee fees. Participants
receive a ten-year annuity, based on the amount deferred, beginning at the
participants normal retirement date from the Board.
During 1997, CSW retained Mr. Glenn Biggs, a current member of the CSW
Board, under an agreement to pursue special business development activities in
Mexico on behalf of CSW. For the year ended December 31, 1997, CSW paid Mr.
Biggs $120,000 pursuant to this agreement. Effective March 18, 1998, Mr. Biggs
resigned his position as a director of CSW. Mr. Biggs had not previously been
nominated for reelection to the CSW Board. In connection with his resignation,
Mr. Biggs' consulting arrangement was terminated. CSW and Mr. Biggs entered into
an agreement pursuant to which Mr. Biggs was paid, a lump sum for, among other
things, his benefit under certain compensation plans and to pay his director and
CSW Board committee fees through May 1998 and his consulting fees through March
1998. Pursuant to that agreement, Mr. Biggs and his spouse are also entitled to
continued medical and dental coverage under the CSW Medical Plan for Outside
Directors and CSW has agreed to maintain the memorial gift program for Mr.
Biggs.
All current directors attended more than 75 percent of the total number of
meetings held by the Board and each committee on which such directors served in
1997, except for Mr. Ward who attended 57 percent of the total meetings.
Security Ownership of Management
The following table shows securities beneficially owned as of December 31,
1997 by each director and nominee, certain executive officers and all directors
and executive officers as a group. Share amounts shown in this table include
options exercisable within 60 days after December 31, 1997, restricted stock,
CSW Shares credited to thrift plus accounts and all other CSW Shares
beneficially owned by the listed persons.
<TABLE>
<CAPTION>
NAME CSW SHARES(1)(2)
- - --------------------------------------------------- -----------------
<S> <C>
Glenn Biggs........................................ 19,211
Molly Shi Boren.................................... 3,119
E.R. Brooks........................................ 131,529
Donald M. Carlton.................................. 8,230
T. J. Ellis........................................ 7,694
Glenn Files........................................ 42,269
Joe H. Foy......................................... 10,717
T.M. Hagan......................................... 13,625
William R. Howell.................................. 1,000
Robert W. Lawless.................................. 3,074
Venita McCellon-Allen.............................. 6,528
Ferd. C. Meyer, Jr................................. 46,480
James L. Powell.................................... 4,211
Glenn D. Rosilier.................................. 68,071
Richard L. Sandor.................................. --
Thomas V. Shockley, III............................ 68,329
Lloyd D. Ward...................................... 2,157
All of the above and other
officers as a group (CSW
directors and officers).......................... 486,165
</TABLE>
- - ------------------------
(1) Shares for Ms. McCellon-Allen, Messrs. Brooks, Files, Hagan, Meyer,
Rosilier, Shockley, and CSW directors and officers include 1,125, 12,225,
4,500, 1,125, 5,700, 5,700, 7,275, and 42,150 shares of restricted stock,
respectively. These individuals currently have voting power, but not
investment power, with respect to these shares. The above shares also
include 1,934, 65,175, 23,653, 8,484, 32,889, 32,889, 42,231, and 239,258
CSW Shares underlying immediately exercisable options held by Ms.
McCellon-Allen, Messrs. Brooks, Files, Hagan, Meyer, Rosilier, Shockley, and
CSW directors and officers, respectively.
(2) All of the share amounts represent less than one percent of the outstanding
CSW Shares.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Set forth below are the only persons or groups known to CSW as of December
31, 1997, with beneficial ownership of 5 percent or more of CSW's Shares.
<TABLE>
<CAPTION>
CSW SHARES
------------------------------
<S> <C> <C>
AMOUNT OF
NAME, ADDRESS OF BENEFICIAL PERCENT OF
BENEFICIAL OWNERS OWNERSHIP CLASS
- - ------------------------------------------- ----------------------------
Mellon Bank Corporation and subsidiaries... 12,196,127(1) 6%
One Mellon Bank Center
Pittsburgh, PA 15258
</TABLE>
- - ------------------------
(1) Mellon Bank Corporation and its subsidiaries, including Mellon Bank, N.A.,
which acts as trustee of an employee benefit plan of CSW, reported that they
exercise sole voting power as to 11,022,435 shares and shared voting power
as to 11,022,435 shares.
CPL, PSO, SWEPCO AND WTU EXECUTIVE COMPENSATION
The following table sets forth the aggregate cash and other
compensation for services rendered for the fiscal years of 1997, 1996 and 1995
for the President of each of the U.S. Electric Operating Companies and the Named
Executive Officers as defined below.
Because of the functional restructuring undertaken by CSW during 1996,
certain of the Executive Officers of the U.S. Electric Operating Companies,
Messrs. Files, Bremer, Zemanek and Verret, are not actually employed by any of
the U.S. Electric Operating Companies. Instead, they are employed by CSW
Services and manage CSW business units and perform policy-making functions that
are integral to the U.S. Electric Operating Companies. Therefore, these
individuals are included in the Summary Compensation Table as Named Executive
Officers due to the functional perspective regarding the management of the
companies. For additional information regarding the restructuring, see PART
II-MD&A.
U.S. ELECTRIC OPERATING COMPANIES
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
--------------------------------- ------------------------ -------
CSW
Other CSW Securities
Annual Restricted Underlying All Other
Name and Compen- Stock Options/ LTIP Compen-
Principal Position Salary Bonus sation Award(s) SARs Payouts sation
At Registrant YEAR ($) ($)(1) ($)(2) ($)(1)(3) (#) ($) ($)(4)
- - -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Glenn Files, Senior 1997 374,999 143,099 8,534 -- 31,000 -- 23,757
Vice President of CSW 1996 331,135 44,860 66,415 153,750 -- -- 23,992
Electric Operations (2,5) 1995 266,223 85,048 19,144 -- -- -- 23,117
Richard H. Bremer, 1997 307,462 99,993 4,648 -- 26,000 -- 21,357
President of CSW Energy 1996 305,910 144,404 73,711 153,750 -- -- 21,742
Services business unit 1995 298,372 89,358 14,691 -- -- -- 21,706
(2,5)
Robert L. Zemanek, 1997 283,250 89,279 10,272 -- 24,000 -- 23,757
President of CSW Energy 1996 283,250 176,863 6,500 153,750 -- -- 23,992
Delivery business unit (5) 1995 276,270 91,436 9,192 -- -- -- 23,117
Richard P. Verret, 1997 251,230 83,390 2,083 -- 21,000 -- 7,953
President of CSW 1996 236,154 84,788 6,055 89,688 -- -- 7,590
Production (5)
M. Bruce Evans 1997 208,000 65,780 882 -- 14,000 -- 5,520
President of CPL (2,5) 1996 208,000 91,376 70,783 89,688 -- -- 4,500
T. D. Churchwell, 1997 192,500 53,672 2,167 -- 13,000 -- 6,398
President of PSO (2,5) 1996 192,500 24,097 79,730 38,438 -- -- 5,340
1995 180,400 40,388 9,206 -- -- -- 4,500
Michael D. Smith, 1997 190,923 64,306 945 -- 13,000 -- 6,419
President of SWEPCO (2,5) 1996 184,269 64,050 115,322 38,438 -- -- 5,340
Floyd W. Nickerson, 1997 160,769 40,293 1,806 -- 11,000 -- 6,661
President of WTU (2,5) 1996 147,692 36,384 69,665 38,438 -- -- 5,270
(1) Amounts in this column are paid or awarded in a calendar year for
performance in a preceding year.
(2) The following are the perquisites and other personal benefits required to
be identified in respect of each Named Executive Officer.
1996 Relocation Reimbursements
- - --------------------------------------------------------------
Glenn Files $25,662
Richard H. Bremer 34,117
M. Bruce Evans 32,537
T.D. Churchwell 38,955
Michael D. Smith 63,818
Floyd W. Nickerson 37,416
(3) Grants of restricted stock are administered by the Executive Compensation
Committee of the CSW Board of Directors, which has the authority to
determine the individuals to whom and the terms upon which restricted stock
grants, including the number of underlying shares, shall be made. The
awards reflected in this column all have four-year vesting periods with 25%
vesting on the first, second, third and fourth anniversary dates of the
award. Upon vesting, CSW Shares are re-issued without restrictions. The
individuals receive dividends and may vote shares of restricted stock, even
before they are vested. The amount reported in the table represents the
market value of the shares at the date of grant. As of December 31, 1997,
the aggregate restricted stock holdings of each of the Named Executive
Officers are presented in the following table.
Restricted Stock Held Market Value at
Name at December 31, 1997 December 31, 1997
- - --------------------------------------------------------------------
Glenn Files 4,500 $121,781
Richard H. Bremer 4,500 121,781
Robert L. Zemanek 4,500 121,781
Richard P. Verret 2,625 71,039
M. Bruce Evans 2,625 71,039
T. D. Churchwell 1,125 30,445
Michael D. Smith 1,125 30,445
Floyd W. Nickerson 1,125 30,445
(4) Amounts shown in this column consist of: (i) the annual employer matching
payments to CSW's Retirement Savings Plan, (ii) premiums paid per
participant for personal liability insurance and (iii) average amounts of
premiums paid per participant in those years under CSW's memorial gift
program. Under this program, for certain executive officers, directors and
retired directors from the CSW System, CSW will make a donation in a
participant's name to up to three charitable organizations in an aggregate
of $500,000, payable by CSW upon such person's death. CSW maintains
corporate-owned life insurance policies to fund the program. The annual
premiums paid by CSW are based on pooled risks and averaged $15,803 per
participant for 1997, $16,402 for 1996 and $16,367 for 1995. In 1997, 1996
and 1995, Messrs. Bremer, Files and Zemanek participated.
(5) System Affiliations.
In the first quarter of 1998, the positions of President and General
Manager at both CPL and WTU were combined into one. These position's were
assumed by J. Gonzalo Sandoval for CPL and Paul J. Brower for WTU. Messrs.
Evans and Nickerson assumed other positions within the CSW System.
Messrs. Files, Bremer, Zemanek and Verret assumed policy making functions
for each of the U.S. Electric Operating Companies in 1996. Messrs. Evans,
Smith and Nickerson assumed policy-making positions at the U.S. Electric
Operating Companies in 1996.
Messrs. Verret, Evans, Smith and Nickerson received no compensation from
any of the U.S. Electric Operating Companies in 1995.
</TABLE>
OPTION/SAR GRANTS
Shown below is information on grants of stock options made in 1997
pursuant to the CSW stock option plan to the Named Executive Officers. No stock
appreciation rights were granted in 1997.
<TABLE>
<CAPTION>
CSW OPTION/SAR GRANTS IN 1997(1)
Potential Realizable
Value at Assumed Annual
Rates of CSW Stock
Price Appreciation for
Individual Grants Option Terms(3)
- - ---------------------------------------------------------------------------- ------------------
Number of CSW % of Total
Securities Options/SARs
Underlying Granted to Exercise or
Options/SARs Employees In Base Price Expiration
Name Granted(#)(2) Fiscal Year ($/Sh) Date 5%($) 10%($)
- - ---- ------------- ----------- ------------ ------------ ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Glenn Files 31,000 4.5 20.750 5/23/2007 405,248 1,022,768
Richard H. Bremer 26,000 3.8 20.750 5/23/2007 339,885 857,805
Robert L. Zemanek 24,000 3.5 20.750 5/23/2007 313,740 791,820
Richard P. Verret 21,000 3.0 20.750 5/23/2007 274,523 692,843
M. Bruce Evans 14,000 2.0 20.750 5/23/2007 183,015 461,895
T. D. Churchwell 13,000 1.9 20.750 5/23/2007 169,943 428,903
Michael D. Smith 13,000 1.9 20.750 5/23/2007 169,943 428,903
Floyd W. Nickerson 11,000 1.6 20.750 5/23/2007 143,798 362,918
(1) The stock option plans are administered by the Executive Compensation
Committee of the Board, which has the authority to determine the
individuals to whom and the terms upon which option and SAR grants
shall be made.
(2) All options were granted on May 23, 1997, and are first exercisable 12
months after the grant date, with one-third of the shares becoming
exercisable at that time and with an additional one third of the
aggregate becoming exercisable on each of the next two anniversary
dates.
(3) The annual rates of appreciation of 5% and 10% are specifically
required by SEC disclosure rules and in no way guarantee that such
annual rates of appreciation will be achieved by CSW nor should this be
construed in any way to constitute any representation by CSW that such
growth will be achieved.
</TABLE>
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE
Shown below is information regarding option/SAR exercises during 1997
and unexercised options/SARs at December 31, 1997 for the Named Executive
Officers.
AGGREGATED OPTION/SAR EXERCISES IN 1997
AND FISCAL YEAR-END OPTION/SAR VALUES
Number of CSW
Securities Value of
Underlying Unexercised In-the-Money
Shares Options/SARs at Options/SARs
Name Acquired Value Year-End at Year-End
on Exercise Realized Exercisable/ Exercisable/
(#) ($) Unexercisable Unexercisable (1)
- - ------------------------------------------------------------------------------
Glenn Files -- -- 23,653/31,000 5,593/195,688
Richard H. Bremer -- -- 28,332/26,000 3,915/164,125
Robert L. Zemanek -- -- 25,430/24,000 6,015/151,500
Richard P. Verret 100 1,081 13,325/21,000 14,889/132,563
M. Bruce Evans -- -- 8,928/14,000 9,810/88,375
T. D. Churchwell -- -- 9,268/13,000 5,763/82,063
Michael D. Smith -- -- 7,779/13,000 2,413/82,063
Floyd W. Nickerson -- -- 4,867/11,000 675/69,438
(1) Calculated based upon the difference between the closing price of CSW's
Shares on the New York Stock Exchange on December 31, 1997 ($27.0625 per
share) and the exercise price per share of the outstanding unexercisable
and exercisable options ($16.250, $20.750, $24.813 and $29.625, as
applicable).
LONG-TERM INCENTIVE PLAN-AWARDS IN 1997
The following table shows information concerning awards made to the
Named Executive Officers during 1997 under the CSW stock option plan.
Estimated
Future Payouts under
Number of Performance or Non-stock Price Based Plans
Shares, Units Other Period ----------------------------
or Other Until Maturation Threshold Target Maximum
Name Rights or Payout ($) ($) ($)
- - ------------------------------------------------------------------------------
Glenn Files -- 2 years -- 225,000 337,500
Richard H. Bremer -- 2 years -- 183,546 275,319
Robert L. Zemanek -- 2 years -- 169,950 254,925
Richard P. Verret -- 2 years -- 150,000 225,000
M. Bruce Evans -- 2 years -- 90,667 136,001
T. D. Churchwell -- 2 years -- 63,258 94,887
Michael D. Smith -- 2 years -- 54,740 82,110
Floyd W. Nickerson -- 2 years -- 47,369 71,054
Payouts of these awards are contingent upon CSW's achieving a specified
level of total stockholder return, relative to the S&P Electric Index, for a
three-year period, or cycle, and exceeding a certain defined minimum threshold.
If the Named Executive Officer's employment is terminated during the performance
period for any reason other than death, total and permanent disability or
retirement, then the award is canceled. The CSW stock option plan contains a
provision accelerating awards upon a change in control of CSW. Except as
provided in the next sentence, if a change in control of CSW occurs, all options
become fully exercisable and all restrictions, terms and conditions applicable
to all restricted stock are deemed lapsed and satisfied and all
performance-based units are deemed to have been fully earned, as of the date of
the change in control. Awards which have been outstanding for less than six
months prior to the date the change in control occurs are not subject to
acceleration upon the occurrence of a change of control. The CSW stock option
plan also contains provisions designed to prevent circumvention of the above
acceleration provisions through coerced termination of an employee prior to a
change in control.
RETIREMENT PLAN
CSW maintains the Retirement Plan for eligible employees, in addition,
CSW maintains the SERP, a non-qualified ERISA excess plan, that primarily
provides benefits that cannot be payable under the qualified Retirement Plan
because of maximum limitations imposed on such plans by the Internal Revenue
Code.
Through June 30, 1997, the Retirement Plan was structured as a
traditional, defined benefit final average pay plan. Effective, July 1, 1997,
the present value of accrued benefits under the Retirement Plan was converted to
a cash balance.
Under the cash balance formula, each participant has an account, for
recordkeeping purposes only, to which pay credits are allocated annually based
on a percentage of the participant's pay. As of July 1, 1997, the definition of
pay for the CSW Cash Balance Plan was expanded to include not only base pay but
also bonuses, overtime, and commissions. The applicable percentage is determined
by the age and years of vesting service the participant has with CSW and its
affiliates as of December 31 of each year (or termination date, if earlier). The
following table shows the Applicable Percentage used to determine credits at the
age and years of service indicated.
Sum of Age plus
YEARS OF SERVICE APPLICABLE PERCENTAGE
< 30 3.0%
30-39 3.5%
40-49 4.5%
50-59 5.5%
60-69 7.0%
70 or more 8.5%
As of December 31, 1997, the sum of age plus years of service of the
Named Executive Officers for the cash balance formula are as follows: Mr.
Files, 76; Mr. Bremer, 69; Mr. Zemanek, 73; Mr. Verret, 76; Mr. Evans, 60; Mr.
Churchwell, 72; Mr. Smith, 53; Mr. Nickerson, 58.
All balances in the accounts of participants earn a fixed rate of
interest which is also credited annually. The interest rate for a particular
year is the average rate of return of the 30-year Treasury Rate for November of
the prior year. For 1997, the interest rate was 6.48%. For 1998, the interest
rate is 6.11%. Interest continues to be credited as long as the participant's
balance remains in the plan.
At retirement or other termination of employment, an amount equal to
the vested balance (including qualified and SERP benefit) then credited to the
account is payable to the participant in the form of an immediate or deferred
lump-sum or annuity. Benefits (both from the CSW Cash Balance Plan and the SERP)
under the cash balance formula are not subject to reduction for Social Security
benefits or other offset amounts. The estimated annual benefit payable to each
of the Named Officers as a single life annuity at age 65 under the Retirement
Plan and the SERP is: Mr. Files, $272,378; Mr. Bremer, $213,333; Mr. Zemanek,
$243,305; Mr. Verret, $173,626; Mr. Evans, $185,905; Mr. Churchwell; $109,329;
Mr. Smith, $91,560; Mr. Nickerson, $139,609. These projections are based on the
following assumptions: (1) participant remains employed until age 65; (2) salary
used is base pay paid for calendar year 1997 assuming no future increases plus
bonus at 1997 target level; (3) interest credit at 6.11% for 1998 and future
years; (4) the conversion of the lump-sum cash balance to a single life annuity
at normal retirement age is based on an interest rate of 6.11% and the 1983
Group Annuity Mortality Table, which sets forth generally accepted life
expectancies.
In addition, certain employees who were 50 or over and had completed at
least 10 years of service as of July 1, 1997, also continue to earn a benefit
using the prior pension formula. At commencement of benefits, the following
Named Officers have a choice of their accrued benefit using the cash balance
formula or their accrued benefit using the prior pension formula: Mr. Verret and
Mr. Churchwell. Once the participant selects either the earned benefit under the
cash balance formula or the earned benefit under the prior pension formula, the
other earned benefit is no longer available.
The table below shows the estimated combined benefits payable from both
the prior pension formula and the SERP based on retirement age of 65, the
average compensation shown, the years of credited service shown , continued
existence of the prior pension formula without substantial change and payment in
the form of a single life annuity.
ANNUAL BENEFITS AFTER
SPECIFIED YEARS OF CREDITED SERVICE
Average
Compensation 15 20 25 30 or More
-----------------------------------------------------------------------
$100,000 $ 25,050 $ 33,333 $ 41,667 $ 50,000
150,000 37,575 50,000 62,500 75,000
200,000 50,100 66,667 83,333 100,000
250,000 62,625 83,333 104,167 125,000
300,000 75,150 100,000 125,000 150,000
350,000 87,675 116,667 145,833 175,000
450,000 112,725 150,000 187,500 225,000
550,000 137,775 183,333 229,167 275,000
650,000 162,825 216,667 270,833 325,000
750,000 187,875 250,000 312,500 375,000
850,000 212,500 283,333 357,000 425,000
Benefits payable under the prior pension formula are based upon the
participant's years of credited service, age at retirement, and covered
compensation earned by the participant. The annual normal retirement benefit
payable under the prior pension formula and the SERP are based on 1.67 percent
of "Average Compensation" times the number of years of credited service (reduced
by no more than 50 percent of a participant's age 62 or later Social Security
benefit). "Average compensation" is covered compensation for the prior pension
formula and equals the average annual compensation, reported as salary in the
Summary Compensation Table, during the 36 consecutive months highest pay during
the 120 months prior to retirement.
Respective years of credited service and ages, as of December 31, 1997,
for the following officers who continue to earn a benefit under the prior
pension formula are: Mr. Verret, 25 and 51, Mr. Churchwell, 19 and 53.
The registrants have entered into change in control agreements with
certain individuals named in the Summary Compensation Table. The purpose of the
agreements is to assure the objective judgment, and to retain the loyalties of
these key individuals in the event CSW is faced with a potential change in
control. Consummation of the proposed AEP Merger will constitute a change in
control under these agreements, information related to the change in control
agreements is incorporated by reference herein from THE MERGER - CSW LONG-TERM
INCENTIVE PLAN and CHANGE IN CONTROL AGREEMENTS of the Joint Proxy Statement.
MEETINGS AND COMPENSATION
Those directors who are not also officers of CPL, PSO, SWEPCO and WTU
receive annual directors' fees and a fee of $300 plus expenses for each board or
committee meeting attended, as described below. They are also eligible to
participate in a deferred compensation plan. Under this plan such directors may
elect to defer payment of annual directors' and meeting fees until they retire
from the board or as they otherwise direct. The number of board meetings and
annual directors' fees are presented in the following table.
CPL PSO SWEPCO WTU
----------------------------------------
Number of regular board meetings 4 4 4 4
Annual directors' fees $6,000 $6,000 $6,600 $6,000
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No person serving during 1997 as a member of the Executive Compensation
Committee of the Board of Directors of CSW served as an officer or employee of
any registrant during or prior to 1997. No person serving during 1997 as an
executive officer of the U.S. Electric Operating Companies serves or has served
on the compensation committee or as a director of another company whose
executive officers serve or has served as a member of the Executive Compensation
Committee of CSW or as a director of one of the U.S. Electric Operating
Companies.
SECURITY OWNERSHIP OF MANAGEMENT
The following tables show securities beneficially owned as of December
31, 1997, by each director, the President and Executive Officers of each of the
U.S. Electric Operating Companies. Share amounts shown in this table include
options exercisable within 60 days after December 31, 1997, restricted stock,
CSW Shares credited to thrift plus accounts and all other CSW Shares
beneficially owned by the listed persons.
Each of the U.S. Electric Operating Companies has one or more series of
preferred stock outstanding. As of December 31, 1997, none of the individuals
listed in the following tables owned any shares of preferred stock of any U.S.
Electric Operating Company.
BENEFICIAL OWNERSHIP AS OF DECEMBER 31, 1997
CSW Common
CPL Underlying
CSW Restricted Immediately
Name Common (1) Stock (2) (3) Exercisable Options (3)
- - ------------------------------------------------------------------------------
John F. Brimberry 765 -- --
E. R. Brooks 131,529 12,225 65,175
M. Bruce Evans 12,574 2,625 8,928
Glenn Files 42,269 4,500 23,653
Ruben M. Garcia -- -- --
Robert A. McAllen 1,500 -- --
Pete Morales, Jr. -- -- --
H. Lee Richards 1,400 -- --
J. Gonzalo Sandoval 16,850 1,125 6,926
Gerald E. Vaughn 6,023 1,125 1,337
All of the above and other
officers as a group 223,958 22,725 112,742
PSO
E. R. Brooks 131,529 12,225 65,175
T. D. Churchwell 12,597 1,125 9,268
Harry A. Clarke -- -- --
Glenn Files 42,269 4,500 23,653
Paul K. Lackey, Jr. -- -- --
Paula Marshall-Chapman -- -- --
William R. McKamey 13,554 1,125 3,323
Dr. Robert B. Taylor, Jr. -- -- --
All of the above and other
officers as a group 210,428 20,100 108,142
SWEPCO
E. R. Brooks 131,529 12,225 65,175
James E. Davison -- -- --
Glenn Files 42,269 4,500 23,653
Dr. Frederick E. Joyce -- -- --
John M. Lewis -- -- --
Karen C. Martin 3,741 -- 2,005
William C. Peatross -- -- --
Maxine P. Sarpy 100 -- --
Michael D. Smith 10,176 1,125 7,779
All of the above and other
officers as a group 198,867 18,975 105,335
WTU
E. R. Brooks 131,529 12,225 65,175
Paul J. Brower 10,911 1,125 7,145
Glenn Files 42,269 4,500 23,653
Tommy Morris 2,000 -- --
Floyd W. Nickerson 6,403 1,125 4,867
Dian G. Owen 100 -- --
James M. Parker 5,000 -- --
F. L. Stephens 2,800 -- --
All of the above and other
officers as a group 214,142 20,100 107,563
(1) Beneficial ownership percentages are all less than one percent and
therefore are omitted.
(2) These individuals currently have voting power, but not investment power,
with respect to these shares.
(3) These shares are included in the CSW Common column.
ASH CREEK MINING COMPANY
INCOME STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1997
OPERATING REVENUE
Sale Of Coal
Miscellaneous Operating Revenue $2,534
-----------
TOTAL OPERATING REVENUE 2,534
-----------
OPERATING EXPENSES
Provision for Reclamation Expense
Reclamation Expense - Actual 56,310
Reclamation Accrual Reversal - Credit
General Mine Operation
General Mine Maintenance
Environmental Sampling
Royalties
Depreciation
Administrative and General (A) 25,002
Federal Income Taxes (75,738)
Deferred Income Taxes
Other Taxes
-----------
TOTAL OPERATING EXPENSES (5,574)
-----------
NET OPERATING INCOME (3,040)
-----------
OTHER DEDUCTIONS
Interest Expense to PSO 230,716
Interest Expense Other
Miscellaneous Other Deduction - Property Write Down
Interest Income and Other
Gain on Sales of Assets (93,100)
-----------
TOTAL OTHER DEDUCTIONS 137,616
-----------
NET INCOME (LOSS) ($140,656)
===========
<PAGE>
ASH CREEK MINING COMPANY
BALANCE SHEET
AS OF DECEMBER 31, 1996
ASSETS
PLANT
Ash Creek Mining Company
Buildings & Service Facilities
Equipment
Land & Land Rights
-----------
TOTAL PLANT
Less: Reserve For Depreciation-Buildings
Reserve For Depreciation-Equipment
Reserve For Property Valuation
Retirement Work in Progress
-----------
TOTAL RESERVE
-----------
NET PLANT
-----------
CURRENT & ACCRUED ASSETS
Cash $25,728
Working Funds
Temporary Cash Investments
Accounts Receivable-PSO
Accounts Receivable 1,863
Coal Inventory
Materials & Supplies
Prepayments
-----------
TOTAL CURRENT & ACCRUED ASSETS 27,591
DEFERRED DEBITS
Development Cost Capitalized
Less: Reserve For Valuation Acct
Other Deferred Debits
TOTAL DEFERRED DEBITS
-----------
TOTAL ASSETS $27,591
===========
CAPITALIZATION & LIABILITIES
CAPITALIZATION
Common Stock $3,839,040
Paid In Capital 6,484,384
Unappropriated Retained Earnings (10,278,213)
Bonds
Unamortized Discount On Bonds
-----------
TOTAL CAPITALIZATION 45,211
CURRENT & ACCRUED LIABILITIES
Notes Payable-PSO 26
Notes Payable-Other 776
Accounts Payable-PSO
Accounts Payable-Other
Taxes Accrued (18,422)
Accrued Interest Payable-PSO
Accrued Interest Payable-Other
Misc. Current & Accrued Liabilities
-----------
TOTAL CURRENT & ACCRUED LIABILITIES (17,620)
OTHER DEFERRED CREDITS
Deferred Investment Tax Credit
Deferred Taxes On Income
Reserve For Mine Closing
-----------
TOTAL CAPITALIZATION & LIABILITIES $27,591
===========
THE ARKLAHOMA CORPORATION
FINANCIAL STATEMENTS AS OF
NOVEMBER 30, 1997 AND 1996
TOGETHER WITH REPORT OF
INDEPENDENT PUBLIC ACCOUNTANTS
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of
The Arklahoma Corporation:
We have audited the accompanying balance sheets of The Arklahoma Corporation
(an Arkansas corporation) as of November 30, 1997 and 1996, and the related
statements of income and 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.
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 signficant 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 Arklahoma Corporation as of
November 30, 1997 and 1996, and the results of its operations and its cash flows
for the years then ended in conformity with generally accepted accounting
principles.
Arthur Andersen LLP
Oklahoma City, Oklahomam,
December 19, 1997
<PAGE>
THE ARKLAHOMA CORPORATION
BALANCE SHEETS
NOVEMBER 30, 1997 AND 1996
ASSETS 1997 1996
---------- ----------
UTILITY PLANT:
Electric plant in service, at cost $2,561,863 $2,561,863
Less - Accumulated depreciation 2,249,240 2,249,240
--------- ---------
Total utility plant 312,623 312,623
CURRENT ASSETS:
Cash and cash equivalents 121,095 155,943
Accounts receivable 500 -
Accounts receivable from affiliated
companies - 29,751
--------- ---------
Total current assets 121,595 185,694
Total assets $ 434,218 $ 498,317
========= =========
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock, par value $100 per
shares authorized, 500 shares
outstanding $ 50,000 $ 50,000
Retained earnings 308,616 305,867
--------- ---------
Total capitalization 358,616 355,867
CURRENT LIABILITIES:
Accounts payable 5,787 82,158
Accounts payable to affiliated
companies 9,523 -
--------- ---------
Total current liabilities 15,310 82,158
--------- ---------
DEFERRED CREDITS:
Deferred income taxes 60,292 60,292
Total liabilities 75,602 142,450
Total capitalization and
liabilities $ 434,218 $ 498,317
========= =========
The accompanying notes are an integral part of the balance sheets.
<PAGE>
THE ARKLAHOMA CORPORATION
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
FOR THE YEARS ENDED NOVEMBER 30, 1997 AND 1996
REVENUES: 1997 1996
---------- ----------
Interest Income $ 10,303 $ 8,994
Other 500 -
--------- ---------
10,803 8,994
--------- ---------
EXPENSES:
Administrative and General 7,078 6,757
Other 478 808
--------- ---------
Total Expenses 7,556 7,565
--------- ---------
Income before federal and state
income taxes 3,247 1,429
FEDERAL AND STATE INCOME TAXES 498 260
--------- ---------
NET INCOME 2,749 1,169
RETAINED EARNINGS, beginning of year 305,867 304,698
Less- Dividends declared - -
--------- ---------
RETAINED EARNINGS, end of year $308,616 $305,867
========= =========
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE ARKLAHOMA CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED NOVEMBER 30, 1997 AND 1996
1997 1996
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 2,749 $ 1,169
Change In Certain Assets and Liabilities
Accounts Receivable 29,251 66,898
Accounts Payable (66,848) 74,193
Dividends Payable - (290,000)
--------- ---------
Net cash used in operating
activities (38,848) (147,740)
--------- ---------
NET DECREASE IN CASH AND CASH
EQUIVALENTS (34,848) (147,740)
CASH AND CASH EQUIVALENTS,
BEGINNING OF YEAR 155,943 303,683
--------- ---------
CASH AND CASH EQUIVALENTS,
END OF YEAR $121,095 $155,943
========= =========
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION:
Net Cash Paid During The Year
For Income Taxes $ 217 $ 2,867
========= =========
The accompanying notes are an integral part of these financial statements.
<PAGE>
THE ARKLAHOMA CORPORATION
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1997 AND 1996
1. OPERATIONS:
The Arklahoma Corporation's (the "Company") utility plant consists
principally of transmission facilities which are being leased to its three
stockholder companies from year to year. Pursuant to the terms of the lease
agreement, the lessees have agreed to pay all operating costs, including
maintenance, repairs, insurance and taxes assessed upon the properties. Such
amounts totaled approximately $1,100,000 and $637,000 in fiscal years 1997
and 1996, respectively.
Under the terms of the current lease agreement, annual rentals have been
discontinued but can be reinstated upon the agreement of the Company and the
lessees.
During fiscal year 1996, OG&E sold 146 shares of Arklahoma common stock to
Entergy (AP&L), (68 shares) and SWEPCO, (78 shares) respectively. As a
result of the transaction, Entergy and SWEPCO own 238 shares (47.6%) each and
OG&E owns 24 shares (4.8%).
2. CASH AND CASH EQUIVALENTS:
For purposes of these financial statements, the Company considers all highly
liquid debt instruments purchased with a maturity of three months or less to
be cash equivalents. These investments are carried at cost, which
approximates market.
3. UTILITY PLANT:
Through fiscal year 1980, depreciation was provided using a straight-line
rate based on the electric plant's estimated composite service life of 33
years with a salvage value of 10%. The utility plant became fully
depreciated for financial reporting purposes in fiscal year 1980, and no
depreciation was provided in fiscal years 1981, 1982 or 1983. In 1984, the
Company acquired additional property, which was depreciated over the
remaining term of the lease. For income tax reporting purposes, depreciation
was calculated using a straight-line rate with no estimated salvage value
and an estimated useful life extended to December 1988. All property was
fully depreciated as of December 31, 1988.
4. INCOME TAXES:
Income taxes are accounted for in accordance with Statement of Financial
Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes." This
statement requires the liability method of accounting for income taxes.
Under the liability method, the deferred tax liability, or asset, is
determined based on the difference between the tax reporting and financial
reporting bases of assets and liabilities. The effect on deferred taxes of a
change in tax rates will be recognized in income in the period of the
enactment of the rate change.
Deferred income taxes resulted from temporary differences in financial versus
tax bases of fixed assets. The net liability is reflected as a deferred
income tax liability in the accompanying balance sheets.
The Company has an Oklahoma state net operating loss carryforward available
to reduce future Oklahoma state income taxes payable. The carryforward as of
November 30, 1997, is approximately $16,883 for book purposes and
approximately $22,263 for tax return purposes and begins to expire in 2002.
The Company has an Arkansas state net operating loss carryforward available
to reduce future Arkansas state income taxes payable. The carryforward as of
November 30, 1997, is approximately $1,039 for book and tax return purposes
and begins to expire in 1998.
5. CONTINGENCY:
The Company and each of its three stockholder companies were party to an
action concerning an aircraft colliding into the Company's transmission line.
In 1996, the case was settled in the amount of $30,000. The three
stockholder companies were billed by the Company for reimbursement.
Management received payment from the stockholder companies in early 1997.
<TABLE> <S> <C>
<ARTICLE> opur1
<CIK> 0000092487
<NAME> SOUTHWESTERN ELECTRIC POWER COMPANY
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-END> Dec-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 8,378
<OTHER-PROPERTY-AND-INVEST> 250
<TOTAL-CURRENT-ASSETS> 1,390
<TOTAL-DEFERRED-CHARGES> 503
<OTHER-ASSETS> 2,930
<TOTAL-ASSETS> 13,451
<COMMON> 743
<CAPITAL-SURPLUS-PAID-IN> 1,039
<RETAINED-EARNINGS> 1,774
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,556
26
176
<LONG-TERM-DEBT-NET> 4,187
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 40
<COMMERCIAL-PAPER-OBLIGATIONS> 1,357
<LONG-TERM-DEBT-CURRENT-PORT> 29
1
<CAPITAL-LEASE-OBLIGATIONS> 6
<LEASES-CURRENT> 2
<OTHER-ITEMS-CAPITAL-AND-LIAB> 4,071
<TOT-CAPITALIZATION-AND-LIAB> 13,451
<GROSS-OPERATING-REVENUE> 5,268
<INCOME-TAX-EXPENSE> 151
<OTHER-OPERATING-EXPENSES> 4,382
<TOTAL-OPERATING-EXPENSES> 4,533
<OPERATING-INCOME-LOSS> 735
<OTHER-INCOME-NET> 32
<INCOME-BEFORE-INTEREST-EXPEN> 767
<TOTAL-INTEREST-EXPENSE> 436
<NET-INCOME> 153
12
<EARNINGS-AVAILABLE-FOR-COMM> 153
<COMMON-STOCK-DIVIDENDS> 369
<TOTAL-INTEREST-ON-BONDS> 220
<CASH-FLOW-OPERATIONS> 726
<EPS-PRIMARY> 0.72
<EPS-DILUTED> 0.72
</TABLE>
<TABLE> <S> <C>
<ARTICLE> opur1
<SUBSIDIARY>
<NUMBER> 003
<NAME> CENTRAL POWER AND LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 3,370,019
<OTHER-PROPERTY-AND-INVEST> 7,044
<TOTAL-CURRENT-ASSETS> 187,241
<TOTAL-DEFERRED-CHARGES> 6,180
<OTHER-ASSETS> 1,242,826
<TOTAL-ASSETS> 4,813,310
<COMMON> 168,888
<CAPITAL-SURPLUS-PAID-IN> 405,000
<RETAINED-EARNINGS> 833,282
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,407,170
0
163,204
<LONG-TERM-DEBT-NET> 1,452,266
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 28,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,762,670
<TOT-CAPITALIZATION-AND-LIAB> 4,813,310
<GROSS-OPERATING-REVENUE> 1,376,282
<INCOME-TAX-EXPENSE> 74,044
<OTHER-OPERATING-EXPENSES> 1,050,871
<TOTAL-OPERATING-EXPENSES> 1,124,915
<OPERATING-INCOME-LOSS> 251,367
<OTHER-INCOME-NET> 8,277
<INCOME-BEFORE-INTEREST-EXPEN> 259,644
<TOTAL-INTEREST-EXPENSE> 131,173
<NET-INCOME> 128,471
9,523
<EARNINGS-AVAILABLE-FOR-COMM> 121,350
<COMMON-STOCK-DIVIDENDS> 157,000
<TOTAL-INTEREST-ON-BONDS> 105,081
<CASH-FLOW-OPERATIONS> 339,640
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> opur1
<SUBSIDIARY>
<NUMBER> 004
<NAME> PUBLIC SERVICE COMPANY OF OKLAHOMA
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,308,586
<OTHER-PROPERTY-AND-INVEST> 20,764
<TOTAL-CURRENT-ASSETS> 84,149
<TOTAL-DEFERRED-CHARGES> 2,755
<OTHER-ASSETS> 31,427
<TOTAL-ASSETS> 1,447,681
<COMMON> 157,230
<CAPITAL-SURPLUS-PAID-IN> 180,000
<RETAINED-EARNINGS> 136,996
<TOTAL-COMMON-STOCKHOLDERS-EQ> 474,226
0
5,287
<LONG-TERM-DEBT-NET> 456,821
<SHORT-TERM-NOTES> 4,874
<LONG-TERM-NOTES-PAYABLE> 40,000
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 466,473
<TOT-CAPITALIZATION-AND-LIAB> 1,447,681
<GROSS-OPERATING-REVENUE> 712,690
<INCOME-TAX-EXPENSE> 20,763
<OTHER-OPERATING-EXPENSES> 610,151
<TOTAL-OPERATING-EXPENSES> 630,914
<OPERATING-INCOME-LOSS> 81,776
<OTHER-INCOME-NET> 1,649
<INCOME-BEFORE-INTEREST-EXPEN> 83,425
<TOTAL-INTEREST-EXPENSE> 37,219
<NET-INCOME> 46,206
364
<EARNINGS-AVAILABLE-FOR-COMM> 50,053
<COMMON-STOCK-DIVIDENDS> 59,000
<TOTAL-INTEREST-ON-BONDS> 28,044
<CASH-FLOW-OPERATIONS> 121,654
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> opur1
<SUBSIDIARY>
<NUMBER> 005
<NAME> SOUTHWESTERN ELECTRIC POWER COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,855,578
<OTHER-PROPERTY-AND-INVEST> 5,839
<TOTAL-CURRENT-ASSETS> 161,434
<TOTAL-DEFERRED-CHARGES> 13,729
<OTHER-ASSETS> 58,166
<TOTAL-ASSETS> 2,094,746
<COMMON> 135,660
<CAPITAL-SURPLUS-PAID-IN> 245,000
<RETAINED-EARNINGS> 324,050
<TOTAL-COMMON-STOCKHOLDERS-EQ> 704,710
25,930
4,709
<LONG-TERM-DEBT-NET> 652,202
<SHORT-TERM-NOTES> 25,175
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 145
1,200
<CAPITAL-LEASE-OBLIGATIONS> 5,549
<LEASES-CURRENT> 2,210
<OTHER-ITEMS-CAPITAL-AND-LIAB> 672,916
<TOT-CAPITALIZATION-AND-LIAB> 2,094,746
<GROSS-OPERATING-REVENUE> 939,869
<INCOME-TAX-EXPENSE> 39,712
<OTHER-OPERATING-EXPENSES> 760,748
<TOTAL-OPERATING-EXPENSES> 800,460
<OPERATING-INCOME-LOSS> 139,409
<OTHER-INCOME-NET> 4,029
<INCOME-BEFORE-INTEREST-EXPEN> 143,438
<TOTAL-INTEREST-EXPENSE> 50,536
<NET-INCOME> 92,902
2,467
<EARNINGS-AVAILABLE-FOR-COMM> 92,254
<COMMON-STOCK-DIVIDENDS> 90,000
<TOTAL-INTEREST-ON-BONDS> 39,242
<CASH-FLOW-OPERATIONS> 200,488
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> opur1
<SUBSIDIARY>
<NUMBER> 006
<NAME> WEST TEXAS UTILITIES COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 667,564
<OTHER-PROPERTY-AND-INVEST> 1,167
<TOTAL-CURRENT-ASSETS> 73,874
<TOTAL-DEFERRED-CHARGES> 15,628
<OTHER-ASSETS> 43,915
<TOTAL-ASSETS> 802,148
<COMMON> 137,214
<CAPITAL-SURPLUS-PAID-IN> 2,236
<RETAINED-EARNINGS> 119,479
<TOTAL-COMMON-STOCKHOLDERS-EQ> 258,929
0
2,483
<LONG-TERM-DEBT-NET> 278,640
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 262,096
<TOT-CAPITALIZATION-AND-LIAB> 802,148
<GROSS-OPERATING-REVENUE> 397,778
<INCOME-TAX-EXPENSE> 9,490
<OTHER-OPERATING-EXPENSES> 343,721
<TOTAL-OPERATING-EXPENSES> 353,211
<OPERATING-INCOME-LOSS> 44,567
<OTHER-INCOME-NET> 1,464
<INCOME-BEFORE-INTEREST-EXPEN> 46,031
<TOTAL-INTEREST-EXPENSE> 24,570
<NET-INCOME> 21,461
144
<EARNINGS-AVAILABLE-FOR-COMM> 22,402
<COMMON-STOCK-DIVIDENDS> 26,000
<TOTAL-INTEREST-ON-BONDS> 20,352
<CASH-FLOW-OPERATIONS> 95,246
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
Exhibit H-1
ORGANIZATIONAL CHART
Investment in Foreign Utility Company
--------------------------
| Central and South West |
| Corporation |
--------------------------
|
|
|
--------------------------
| CSW International, INC. |
--------------------------
|
-----------------------------------------------------------
| | | |
----------------- ----------------- ------------------ ----------------
|CSW International| |CSW International| |CSW International,| | Energia |
| Two, Inc. | | Three, Inc. | | Inc. (Cayman) | |Internacional de|
----------------- ----------------- ------------------ | CSW de S.A. de |
| | | | | C.V. |
-------------------- | | ----------------
| | ----------------- |
------------------- | | CSW Vale L.L.C. | |
|CSW Finance Company| | | (Cayman) | ------------------
------------------- | ----------------- | Enertek, S.A. de |
| ------ | | C.V. |
| | | ------------------
------------------- --------------------------
| CSW Investments | | Empresa de Electricidade |
------------------- | Vale de Paranapanema S.A.|
| --------------------------
|
|
|
--------------------
| SEEBOARD Group plc |
--------------------
|
--------------
| SEEBOARD plc |
--------------
Exhibit H-2
ORGANIZATIONAL CHART
Investments in Exempt Wholesale Generators
--------------------------
| Central and South West |
| Corporation |
--------------------------
|
|
|
--------------------------
| CSW Energy, Inc. |
--------------------------
| |
| ----------------
| |
-------------------------- -----------
| CSW Development - 3 | | Newgulf |
| Inc | | Power |
-------------------------- | Venture |
| -----------
|
|
--------------------|
| |
| |
| |
---------------- -----------------
| CSW Northwest | | CSW Northwest |
| GP, Inc. | | LP, Inc. |
---------------- -----------------
