Registration No.REGISTRATION NO. 333-
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                       Securities and Exchange Commission
                             Washington,===========================================================================

                          SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C. 20549

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                                       FORM S-3
                                Registration Statement Under The Securities Act ofREGISTRATION STATEMENT
                                        UNDER
                              THE SECURITIES ACT OF 1933

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                           Minnesota PowerMINNESOTA POWER & Light CompanyLIGHT COMPANY
                (Exact name of registrant as specified in its charter)

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                  MinnesotaMINNESOTA                               41-0418150
        (State or other jurisdiction          (IRS Employer Identification No.)
      of incorporation or organization)

                               30 West Superior Street
                             Duluth, MinnesotaWEST SUPERIOR STREET
                               DULUTH, MINNESOTA 55802
                                    (218) 722-2641
       (Address, including zip code, and telephone number, including area code,
                     of registrant's principal executive offices)
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              DAVID G. GARTZKE                     JAMES K. VIZANKOPHILIP R. HALVERSON, Esq.
       Senior Vice President-Finance            Corporate TreasurerVice President, General Counsel
        and Chief Financial Officer                 and Corporate Secretary
          30 West Superior Street                   30 West Superior Street
          Duluth, Minnesota 55802                   Duluth, Minnesota 55802
               (218) 722-2641                            (218) 722-2641

              PHILIP R. HALVERSON, Esq.JAMES K. VIZANKO                     ROBERT J. REGER, JR., Esq.
            Vice President, General CounselCorporate Treasurer                        Reid & Priest LLP
          and Corporate Secretary30 West Superior Street                     40 West 57th Street
          30 West Superior StreetDuluth, Minnesota 55802                   New York, New York 10019
               Duluth, Minnesota  55802(218) 722-2641                            (212) 603-2000
         (218) 722-2641
            (Names, addresses, including zip codes, and telephone numbers,
                     including area codes, of agents for service)
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                   It is respectfully requested that the Commission
              send copies of all notices, orders and communications to:
                                MICHAEL CONNOLLY, Esq.
                                Lane & Mittendorf LLP
                                   320 Park Avenue
                               New York, New York 10022
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        APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:  As
     soon as practicable after the registration statement becomes effective.

        If the only securities being registered on this Form are being offered
     pursuant to dividend or interest reinvestment plans, please check the
     following box. / /[ ]

        If any of the securities being registered on this Form are to be offered
     on a delayed or continuous basis pursuant to Rule 415 under the Securities
     Act of 1933, other than securities offered only in connection with dividend
     or interest reinvestment plans, check the following box. /X/[x]

        If this Form is filed to register additional securities for an offering
     pursuant to Rule 462(b) under the Securities Act of 1933, please check the
     following box and list the Securities Act of 1933 registration statement
     number of the earlier effective registration statement for the same
     offering. / /[ ]

        If this Form is a post-effective amendment filed pursuant to Rule 462(c)
     under the Securities Act of 1933, check the following box and list the
     Securities Act of 1933 registration statement number of the earlier
     effective registration statement for the same offering. / /[ ]

        If delivery of the prospectus is expected to be made pursuant to Rule
     434, please check the following box. / /[ ]

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                      Calculation of Registration Fee
==================================================================================================================================== Proposed Maximum Proposed Maximum Title of Each Class of Securities Amount to be Offering Price Aggregate Amount of to be Registered Registered Per Unit Offering Price Registration Fee - ------------------------------------------------------------------------------------------------------------------------------------ Common Stock, without par value 473,006 Shares $26.4375 $12,505,096 $4,312.10 Preferred Share Purchase Rights 473,006 Rights --- --- --- ==================================================================================================================================== EstimatedCALCULATION OF REGISTRATION FEE ========================================================================= PROPOSED PROPOSED MAXIMUM MAXIMUM AMOUNT TITLE OF EACH CLASS OF AMOUNT TO OFFERING AGGREGATE OF SECURITIES BE PRICE OFFERING REGISTRA- TO BE REGISTERED REGISTERED PER UNIT* PRICE* TION FEE ------------------------------------------------------------------------- First Mortgage Bonds . . . $75,000,000 100% $75,000,000 $22,728 ========================================================================= *Estimated solely for the purpose of calculating the registration fee, pursuant to Rule 457(c), on the basis of the average of the high and low prices of the registrant's Common Stock on the New York Stock Exchange composite tape on October 1, 1996. The Preferred Share Purchase Rights (Rights) are attached to and will trade with the Common Stock. The value attributable to the Rights, if any, is reflected in the market price of the Common Stock. Since no separate consideration is paid for the Rights, the registration fee for such securities is included in the fee for the Common Stock.
The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a)purpose of calculating the Securities Act ofregistration fee. PURSUANT TO RULE 429 UNDER THE SECURITIES ACT OF 1933, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a)THE PROSPECTUS FILED AS PART OF THIS REGISTRATION STATEMENT WILL BE USED AS A COMBINED PROSPECTUS IN CONNECTION WITH THIS REGISTRATION STATEMENT AND REGISTRATION STATEMENT NO. 33-55240. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), may determine. ================================================================================MAY DETERMINE. ========================================================================== SUBJECT TO COMPLETION DATED OCTOBER 4, 1996January 30, 1997 PROSPECTUS ---------- $80,000,000 MINNESOTA POWER & LIGHT COMPANY FIRST MORTGAGE BONDS ---------------------- Minnesota Power & Light Company 473,006 Shares of Common Stock (Without Par Value) The shares of common stock, without par value (Common Stock) and the preferred share purchase rights attached thereto (Rights) of Minnesota Power & Light Company (Company or Minnesota Power) offered hereby (collectively, the Shares) will be sold("Company") intends to offer from time to time by the selling shareholders described herein (Selling Shareholders) in brokers' transactions at prices prevailingnot to exceed $80,000,000 aggregate principal amount of its First Mortgage Bonds ("New Bonds"). The New Bonds will be offered on terms to be determined at the time of salesale. This Prospectus will be supplemented by a prospectus supplement ("Prospectus Supplement") which will set forth, as applicable, the specific designation, aggregate principal amount, the purchase price, maturity date, interest rate or as otherwise described in "Planrates, time of Distribution". The Company will not receive anypayment of interest, and the redemption terms and other specific terms of the proceeds from the saleseries of the Shares. ExpensesNew Bonds in connection withrespect of which this Prospectus and the registration of the Shares under the Securities Act of 1933, as amended (1933 Act), including legal and accounting fees of the Company, will be paid by the Company. The Shares were acquired from the Company by the Selling Shareholders in a private placement transaction. This Prospectus has been prepared for the purpose of registering the Shares under the 1933 Act to allow future sales by the Selling Shareholders to the public without restriction. To the knowledge of the Company, the Selling Shareholders have made no arrangement with any brokerage firm for the sale of the Shares. The Selling Shareholders may be deemed to be "underwriters" within the meaning of the 1933 Act. Any commissions received by a broker or dealer in connection with resales of the Shares may be deemed to be underwriting commissions or discounts under the 1933 Act. The Shares have not been registered for sale under the securities laws of any state or jurisdiction as of the date of this Prospectus. Brokers or dealers effecting transactions in the Shares should confirm the registration thereof under the securities laws of the states or jurisdictions in which such transactions occur, or the existence of any exemption from registration. The Common Stock of the Company is listed on the New York Stock Exchange. The last reported sale price on the New York Stock Exchange on October 3, 1996 was $26.75.Supplement are delivered ("Offered Bonds"). ---------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ---------------------- The New Bonds may be sold directly by the Company or through agents designated from time to time or through dealers or underwriters. If any agent of the Company or any underwriters are involved in the sales of the New Bonds, the names of such agents or such underwriters and any applicable commissions or discounts and the net proceeds to the Company will be set forth in the Prospectus Supplement. ---------------------- The date of this Prospectus is , 1996.1997. Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. Available InformationIN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NEW BONDS OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. ---------------------- AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (1934 Act)("1934 Act") and, in accordance therewith, files reports, proxy statements and other information with the Securities and Exchange Commission (Commission)("Commission"). Such reports, proxy statements and other information filed by the Company may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the following Regional Offices of the Commission: New York Regional Office, 7 World Trade Center, 13th Floor, New York, New York 10048; and Chicago Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material may also be obtained at prescribed rates from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The Commission maintains a Web site (http://www.sec.gov) that contains reports, proxy statements and other information filedregarding registrants that file electronically bywith the Commission, including the Company. The Company's Common Stock and the Rightspreferred share purchase rights attached thereto are listed on the New York Stock Exchange. Reports and other information concerning the Company may be inspected and copied at the office of such Exchange at 20 Broad Street, New York, New York. In addition, the Company's 5% Preferred Stock, $100 par value, is listed on the American Stock Exchange. Reports and other information concerning the Company may also be inspected and copied at the office of such Exchange at 86 Trinity Place, New York, New York. ---------------------- Incorporation of Certain Documents by ReferenceINCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents, filed by the Company with the Commission pursuant to the 1934 Act, are hereby incorporated by reference: 1. The Company's Annual Report on Form 10-K for the year ended December 31, 1995 (1995("1995 Form 10-K)10-K"). 2. The Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, and1996, June 30, 1996.1996 and September 30, 1996 (each as amended by a Form 10-Q/A dated January 22, 1997). 3. The Company's Current Reports on Form 8-K dated April 9, 1996, June 18, 1996, August 2, 1996, August 23, 1996, September 5, 1996, and October 3, 1996 and November 7, 1996. Each document filed subsequent to the date of this Prospectus pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act prior to the termination of the offering made by this Prospectus shall be deemed to be incorporated by reference in this Prospectus and shall be a part hereof from the date of filing of such document; provided, however, that the documents enumerated above or subsequently filed by the Company pursuant to Section 13 or 15(d) of the 1934 Act prior to the filing with the Commission of the Company's most recent Annual Report on Form 10-K shall not be incorporated by reference in this Prospectus or be a part hereof from and after the filing of such most recent Annual Report on Form 10-K. The documents which are incorporated by reference in this Prospectus are sometimes hereinafter referred to as the "Incorporated Documents." Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which is - 2 - deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person, including any beneficial owner, to whom a copy of this Prospectus is delivered, upon the written or oral request of any such person, a copy of any document referred to above which has been or may be incorporated in this Prospectus by reference, other than exhibits to such documents (unless such exhibits are specifically incorporated by reference into such documents). Requests for such copies should be directed to: Shareholder Services, Minnesota Power, 30 West Superior Street, Duluth, Minnesota 55802, telephone number (218) 723-3974 or (800) 535-3056. -2- THE COMPANY The Company Minnesota Power is an operating public utility incorporated under the laws of the State of Minnesota since 1906. Its principal executive office is at 30 West Superior Street, Duluth, Minnesota 55802, and its telephone number is (218) 722-2641. The Company has operations in four business segments: (1) electric operations, which include electric and gas services, and coal mining; (2) water operations, which include water and wastewater services; (3) automobile auctions, which also include a finance company and an auto transport company; and (4) investments, which include real estate operations, a 21 percent equity investment in a financial guaranty reinsurance company, and a securities portfolio. As of JuneSeptember 30, 1996 the Company and its subsidiaries had approximately 5,900 employees.
(Unaudited) Six Months Ended Year Ended December 31, June 30, ------------------------------ ---------------- Summary of Earnings Per Share 1993 1994 1995 1995 1996 - ------------------------------------------------------------------------------------------------------------------- Consolidated Earnings Per Share(UNAUDITED) NINE MONTHS YEAR ENDED DECEMBER ENDED 31, SEPTEMBER 30, ------------------- ------------ SUMMARY OF EARNINGS PER SHARE (1) 1993 1994 1995 1995 1996 -------------------------------------------------------------------- CONSOLIDATED EARNINGS PER SHARE Continuing Operations $ 2.27 $ 1.99 $ 2.06 $ 1.69 $ 1.68 Discontinued (.07) .07 .10 .10 - Operations (2) ------ ------ ------ ------ ------ Total $ 2.20 $ 2.06 $ 2.16 $ 1.79 $ 1.68 ====== ====== ====== ====== ====== PERCENTAGE OF EARNINGS BY BUSINESS SEGMENT Continuing Operations $ 2.27 $ 1.99 $ 2.06 $ 1.17 $1.10 Discontinued Operations (.07) .07 .10 .10 - ------- ------- ------ ------ ----- Total $ 2.20 $ 2.06 $ 2.16 $ 1.27 $1.10 ======= ======= ====== ====== ===== Percentage of Earnings by Business Segment Continuing Operations Electric Operations 65% 65% 63% 48% 58% Water Operations 3 23 (2) 2 9 Automobile Auctions - - 0 - 7 Investments 53 39 66 79 54 Corporate Charges and Other (18) (30) (32) (37) (28) Discontinued Operations (3) 3 5 8 - ----- ----- ---- ---- ---- 100% 100% 100% 100% 100% ===== ===== ==== ==== ==== - ------------------------- Financial statement information may not be comparable between periods due to the purchase of ADESA Corporation on July 1, 1995. On June 30, 1995 the Company sold its interest in its paper and pulp business to Consolidated Papers, Inc. (CPI) for $118 million in cash, plus CPI's assumption of certain debt and lease obligations. The Company is still committed to a maximum guarantee of $95 million to ensure a portion of a $33.4 million annual lease obligation for paper mill equipment under an operating lease extending to 2012. CPI has agreed to indemnify the Company for any payments the Company may make as a result of the Company's obligation relating to this operating lease. Includes the financial results for the Reach All Partnership and general corporate expenses not allocable to a specific business segment.
Electric Operations 67% 66% 63% 57% 59% Water Operations 3 23 (2) 2 7 Automobile Auctions - - 0 2 7 Investments 55 40 67 66 54 Corporate Charges (22) (33) (33) (33) (27) and Other (3) Discontinued (3) 4 5 6 - Operations (2) --- --- --- --- --- 100% 100% 100% 100% 100% === === === === === ---------------- (1) Financial statement information may not be comparable between periods due to the purchase of 80 percent of ADESA Corporation on July 1, 1995, another 3 percent on January 31, 1996 and the remaining 17 percent on August 21, 1996. (2) On June 30, 1995 the Company sold its interest in its paper and pulp business to Consolidated Papers, Inc. ("CPI") for $118 million in cash, plus CPI's assumption of certain debt and lease obligations. The Company is still committed to a maximum guarantee of $95 million to ensure a portion of a $33.4 million annual lease obligation for paper mill equipment under an operating lease extending to 2012. CPI has agreed to indemnify the Company for any payments the Company may make as a result of the Company's obligation relating to this operating lease. (3) Includes the financial results for the Reach All Partnership and general corporate expenses not allocable to a specific business segment. - 3 - ELECTRIC OPERATIONS Electric operations generate, transmit, distribute and sell electricity. Minnesota PowerThe Company provides electricity to 124,000 customers in northern Minnesota, while the Company's wholly owned subsidiary, Superior Water, Light and Power Company, sells electricity to 14,000 customers and natural gas to 11,000 customers, and provides water to 10,000 customers in northwestern Wisconsin. Another wholly owned subsidiary, BNI Coal, Ltd. (BNI Coal)("BNI Coal") owns and operates a lignite mine in North Dakota. Two electric generating cooperatives, Minnkota Power Cooperative, Inc. and Square Butte Electric Cooperative (Square Butte)("Square Butte"), presently consume virtually all of BNI Coal's production of lignite coal under coal supply agreements extending to 2027. Under an agreement with Square Butte, Minnesota Powerthe Company purchases 71 percent of the output from the Square Butte unit, which is capable of generating up to 470 megawatts. -3- In 1995 large industrial customers contributed about half of the Company's electric operating revenue. The Company has large power contracts to sell power to eleventen industrial customers (five taconite producers, fivefour paper companies and a pipeline company) each requiring 10 megawatts or more of power. These contracts, which have termination dates ranging from AprilOctober 1997 to December 2005,2007, require the payment of minimum monthly demand charges that cover most of the fixed costs, including a return on common equity, associated with having the capacity available to serve these customers. Water OperationsWATER OPERATIONS Water operations include Florida Water Services Corporation ("Florida Water", formerly Southern States Utilities, Inc. (SSU)), Heater Utilities, Inc. (Heater),("Heater") and Instrumentation Services, Inc. (ISI)("ISI"), three wholly owned subsidiaries of the Company. SSUFlorida Water is the largest private water supplier in Florida. At JuneSeptember 30, 1996 SSUFlorida Water provided water to 118,000119,000 customers and wastewater treatment services to 54,000 customers in Florida. At JuneSeptember 30, 1996 Heater provided water to 24,00025,000 customers and wastewater treatment services to 1,000 customers in North Carolina and South Carolina. ISI provides maintenance services to water utility companies in North Carolina, South Carolina, Florida, Georgia, Tennessee, Virginia and Texas. Automobile AuctionsAUTOMOBILE AUCTIONS ADESA Corporation (ADESA)("ADESA") is a wholly owned subsidiary of the Company and is the third largest automobile auction business in the United States. Headquartered in Indianapolis, Indiana, ADESA owns and operates 2325 automobile auctions in the United States and Canada through which used cars and other vehicles are sold to franchised automobile dealers and licensed used car dealers. Two wholly owned subsidiaries of ADESA, Automotive Finance Corporation and ADESA Auto Transport, perform related services. Sellers at ADESA's auctions include domestic and foreign auto manufacturers, car dealers, fleet/lease companies, banks and finance companies. The Company acquired 80 percent of ADESA on July 1, 1995 for $167 million in cash. In1995. On January 31, 1996 the Company provided an additional $15 million of capital in exchange for 1,982,346 original issue common stock sharesan additional 3 percent of ADESA. This capital contribution increased the Company's ownership interest in ADESA to 83 percent. On August 21, 1996 Minnesota Powerthe Company acquired the remaining 17 percent ownership interest of ADESA from the ADESA management shareholders who, inshareholders. In conjunction with the transaction, four of the management shareholders left ADESA to pursue other opportunities. Acquired goodwill and other intangible assets associated with this acquisition are being amortized on a straight line basis over periods not exceeding 40 years. InvestmentsINVESTMENTS The Company owns 80 percent of Lehigh Acquisition Corporation, a real estate company whichthat owns various real estate properties and operations in Florida. Minnesota PowerThe Company has a 21 percent equity investment in Capital Re Corporation (Capital Re)("Capital Re"). Capital Re is a Delaware holding company engaged primarily in financial and mortgage guaranty reinsurance through its wholly owned subsidiaries, Capital Reinsurance Company and Capital Mortgage Reinsurance Company. Capital Reinsurance Company is a reinsurer of financial guarantees of municipal and non-municipal debt obligations. - 4 - Capital Mortgage Reinsurance Company is a reinsurer of residential mortgage guaranty insurance. The Company's equity investment in Capital Re at JuneSeptember 30, 1996 was $96$99 million. As of JuneSeptember 30, 1996 the Company had approximately $142$160 million invested in a securities portfolio. The majority of the securities are investment gradeportfolio consists of stocks of other utility companies with investment grade debt securities outstanding and are considered by the Company to be conservative investments. Additionally, the Company sells common stock securities short and enters into short sales of treasury futures contracts as part of an overall investment portfolio hedge strategy. -4- Selling ShareholdersAPPLICATION OF PROCEEDS The following table listsCompany is offering a maximum of $80,000,000 aggregate principal amount of its New Bonds. The net proceeds to be received from the Selling Shareholders, the number of shares of Common Stockissuance and sale of the Company beneficially owned by each asNew Bonds will be used for general corporate purposes, which may include the redemption or other acquisition, in whole or in part, of certain of the date of this Prospectus, the number of shares to be offered by each and the number ofCompany's outstanding shares to be owned by each after the sale. Minnesota Power exchanged the Shares for all the outstanding shares of common stock of Alamo Auto Auction Houston, Inc. and Alamo Auto Auction, Inc. owned by the Selling Shareholders. Minnesota Power then contributed the shares to ADESA Holdings, Inc. (ADESA Holdings), a wholly owned subsidiary of Minnesota Power. The Shares were issued by the Company and deliveredsecurities. Reference is made to the Selling Shareholders in a private placement transaction that has been accounted for as a pooling of interests.
Shares to be Shares Owned Shares to be Owned After Selling Shareholder Prior to Offering Offered Hereby Offering - ---------------------- -------------------- ----------------- ----------- Charles O. Massey 165,552 165,552 0 Frank L. Massey and D. A. Massey, as joint tenants 165,552 165,552 0 B. J. McCombs 141,902 141,902 0 - ------------------------ ADESA Holdings owns 100% of Alamo Auto Auction Houston, Inc. (ADESA Houston) and Alamo Auto Auction, Inc. (ADESA San Antonio). Charles O. Massey is an employee of ADESA San Antonio. Frank L. Massey is the Executive Vice President of ADESA San Antonio. As of October 2, 1996 each of the Selling Shareholders individually held less than one percent of the Company's then outstanding Common Stock. As of September 30, 1996 the Selling Shareholders represented to the Company that they (i) were acquiring the Shares pursuant to the share exchange for investment and not with a view toward resale or distribution and (ii) did not at that time have any reason to anticipate any change in circumstances or other particular occasion or event which would cause them to desire to sell or otherwise transfer the Shares. Assumes the sale of all of the Shares covered by this Prospectus and that no additional shares are acquired by the Selling Shareholders.
DividendsIncorporated Documents with respect to the Company's general capital requirements and Price Range The following table sets forth the highgeneral financing plans and low sales prices per share of the Common Stock on the New York Stock Exchange composite tape as published in The Wall Street Journal and the dividends paid for the indicated periods. Price Range Dividends ----------- --------- High Low Per Share ---- --- --------- 1994 First Quarter $ 33 $ 28 $ 0.505 Second Quarter 30 1/8 25 0.505 Third Quarter 28 1/8 25 0.505 Fourth Quarter 26 5/8 24 3/4 0.505 1995 First Quarter $ 26 3/8 $ 24 1/4 $ 0.510 Second Quarter 28 25 1/4 0.510 Third Quarter 28 1/8 26 3/8 0.510 Fourth Quarter 29 1/4 27 1/2 0.510 1996 First Quarter $ 29 3/4 $ 26 1/8 $ 0.510 Second Quarter 29 26 0.510 Third Quarter 28 3/4 26 0.510 Fourth Quarter (through October 3, 1996) 26 7/8 26 3/8 The last reported sale price of the Common Stock on the New York Stock Exchange composite tape on October 3, 1996 was $26.75 per share. The book value of the Common Stock at June 30, 1996 was $18.54 per share. -5- capabilities. RATIOS OF EARNINGS TO FIXED CHARGES The Company has paid dividends without interruption on its Common Stock since 1948, the datecalculated ratios of the initial distributionearnings to fixed charges as follows: Nine Months Year Ended December 31, Ended ---------------------------- September 30, 1991 1992 1993 1994 1995 1996 ---- ---- ---- ---- ---- ------------- Ratio of the Common Stock by American Power & Light Company, the former holder of all such stock.Earnings to Fixed Charges . . . 2.55 2.60 2.52 2.17 1.90 2.18 SUPPLEMENTAL RATIOS OF EARNINGS TO FIXED CHARGES The Company has calculated supplemental ratios of earnings to fixed charges as follows: Nine Months Year Ended December 31, Ended ----------------------------- September 30, 1991 1992 1993 1994 1995 1996 ---- ---- ---- ---- ---- ------------ Supplemental Ratio of Earnings to Fixed Charges . . . . . . 2.20 2.25 2.19 1.95 1.73 1.99 The supplemental ratio of earnings to fixed charges includes the Company's obligations under a Dividend Reinvestment and Stock Purchase Plan (Plan). The Plan provides investors (Participants)contract with a convenient method of acquiring shares of Common StockSquare Butte extending through (i)2007 pursuant to which the reinvestment in Common Stock of all or a portionCompany is purchasing 71 percent of the cash dividends payable onoutput of a generating unit capable of generating up to 470 megawatts. The Company is obligated to pay Square Butte all of Square Butte's leasing, operating and debt service costs (less any amounts collected from the Participant's holdingssale of Common Stockpower or energy to others) that shall not have been paid by Square Butte when due. See Note 12 of the Company's Consolidated Financial Statements incorporated by reference in the Company's 1995 Form 10-K. - 5 - DESCRIPTION OF NEW BONDS General. The New Bonds are to be issued under the Company's Mortgage and Preferred Stocks, and/or (ii)Deed of Trust, dated as of September 1, 1945, with Irving Trust Company (now The Bank of New York) and Richard H. West (W.T. Cunningham, successor), as Trustees, as supplemented by eighteen supplemental indentures (herein collectively referred to as the investment"Mortgage"), all of optional cash payments pursuantwhich are exhibits to the terms of the Plan.Registration Statement. The Plan also provides a means for Participants to deposit into the Plan for safekeeping, free of any service charges, share certificates representing shares of Common Stock. A minimum initial cash investment of $250 is required for interested investors who are not shareholders (except generally for those interested investors who are customers of the Company, Superior Water, Light and Power Company, Heater or SSU, in which case the minimum is $10). No brokerage fees, commissions or other service charges are incurred by a Participant for purchases made under the Plan. However, any such charges are reportedstatements herein with respect to the Internal Revenue Service byNew Bonds and the Company as income to the Participant. The Company reserves the right to suspend, modify, amend or terminate the Plan at any time and to interpret and regulate the Plan as it deems necessary or desirable in connection with the operation of the Plan. Shares of Common Stock are offered for sale under the Plan only by means of a separate prospectus available upon request from the Company. Description of Common Stock General. The following statements relating to the Common StockMortgage are merely an outline and do not purport to be complete. They make use of terms defined in the Mortgage and are qualified in their entirety by express reference to the Company'scited Articles and Sections of Incorporation (Articlesthe Mortgage. Reference is made to the Prospectus Supplement for the following terms of Incorporation)the Offered Bonds (among others): (i) the designation, series and aggregate principal amount of the Offered Bonds; (ii) the percentage or percentages of their principal amount at which such Offered Bonds will be issued; (iii) the date or dates on which the Offered Bonds will mature; (iv) the rate or rates per annum at which the Offered Bonds will bear interest; (v) the times at which such interest will be payable; and (vi) redemption terms or other specific terms. Form and Exchanges. The New Bonds will be issued in definitive fully registered form without coupons in denominations of $1,000 and multiples thereof and will be transferable and exchangeable without charge (except for stamp taxes, if any, or other governmental charges) at The Bank of New York, New York, New York. Interest, Maturity and Payment. Reference is made to the Prospectus Supplement for the interest rate or rates of the Offered Bonds and the Mortgagedates on which such interest is payable. Principal and Deedinterest are payable at The Bank of TrustNew York, New York, New York. Redemption and Purchase of Bonds. The New Bonds will be redeemable, in whole or in part, on 30 days notice at the redemption prices set forth in the Prospectus Supplement for redemptions including (i) for the basic improvement fund, (ii) for the maintenance and replacement fund, (iii) with certain deposited cash, (iv) with proceeds of released property, or (v) at the option of the Company. Reference is also made to the lawsProspectus Supplement for the redemption terms of the StateOffered Bonds. If at the time notice of Minnesota. The Company's authorized capital stock consists of 65,000,000 shares of Common Stock, without par value, 116,000 shares of 5% Preferred Stock, $100 par value, 1,000,000 shares of Serial Preferred Stock, without par value, and 2,500,000 shares of Serial Preferred Stock A, without par value. Dividend Rights. The Common Stockredemption is entitledgiven the redemption moneys are not on deposit with the Corporate Trustee, the redemption may be made subject to all dividends after full provisiontheir receipt before the date fixed for dividends on the issued and outstanding Preferred Stocks and the sinking fund requirementsredemption. Cash deposited under any provisions of the Serial Preferred Stock A, $7.125 Series and $6.70 Series. The Articles of Incorporation provide that so long as any shares of the Company's Preferred Stocks are outstanding, cash dividends on Common Stock are restricted to 75 percent of available net income when Common Stock equity is or would become less than 25 percent but more than 20 percent of total capitalization. This restriction becomes 50 percent when such equity is or would become less than 20 percent. See Note 8 to Consolidated Financial Statements incorporated by reference in the Company's 1995 Form 10-K. Voting Rights (Non-Cumulative Voting). Holders of Common Stock are entitled to notice of and to vote at any meeting of shareholders. Each share of the Common Stock, as well as each share of the issued and outstanding Preferred Stocks, is entitled to one vote. Since the holders of such shares do not have cumulative voting rights, the holders of more than 50 percent of the shares voting can elect all the Company's directors, and in such event the holders of the remaining shares voting (less than 50 percent) cannot elect any directors. In addition, the Preferred Stocks are expressly entitled, as one class, to elect a majority of the directors (the Common Stock, as one class, electing the minority) whenever dividends on any of such Preferred Stocks shallMortgage (with certain exceptions) may be in default in the amount of four quarterly payments and thereafter until all such dividends in default shall have been paid. The Articles of Incorporation include detailed procedures and other provisions relating to these rights and their termination, such as quorums, terms of directors elected, vacancies, class voting as between Preferred Stocks and Common Stock, meetings, adjournments and other matters. -6- The Articles of Incorporation contain certain provisions which make it difficult to obtain control of the Company through transactions not having the approval of the Board of Directors, including: (1) A provision requiring the affirmative vote of 75 percent of the outstanding shares of all classes of capital stock of the Company, present and entitled to vote, in order to authorize certain "Business Combinations." Any such Business Combination is required to meet certain "fair price" and procedural requirements. Neither a 75 percent stockholder vote nor "fair price" is required for any Business Combination which has been approved by a majority of the "Disinterested Directors." (2) A provision permitting a majority of the Disinterested Directors to determine whether the above requirements have been satisfied. (3) A provision providing that certain of the Articles of Incorporation cannot be altered unless approved by 75 percent of the outstanding shares of all classes of capital stock, present and entitled to vote, unless such alteration is recommendedapplied to the shareholders by a majoritypurchase of the Disinterested Directors. Liquidation Rights. After satisfactionBonds of creditors and of the preferential liquidation rights of the outstanding Preferred Stocks ($100 per share plus unpaid accumulated dividends), the holders of the Common Stock are entitled to share ratably in the distribution of all remaining assets. Miscellaneous. Holders of Common Stock have no preemptiveany series. (Mortgage, Art. X.) Sinking or conversion rights. The Common Stock is listed on the New York Stock Exchange. The transfer agents for the Common Stock are Norwest Bank Minnesota, N.A. and the Company. The registrars for the Common Stock are Norwest Bank Minnesota, N.A. and the Company. Description of Preferred Share Purchase RightsImprovement Fund. Reference is made to the Rights Agreement, datedProspectus Supplement concerning whether or not the Offered Bonds are entitled to the benefit of a sinking or improvement fund or other provision for amortization prior to maturity. Of the currently outstanding Bonds, only the 6-1/2% Series due January 1, 1998 has sinking fund or improvement fund provisions. Replacement Fund. Although the New Bonds as such are not entitled to the benefit of July 24, 1996 (Rights Plan) betweena replacement fund, so long as any Bonds of the 6- 1/2% Series due January 1, 1998 are outstanding, there shall be expended for each year for replacements and improvements in respect of the mortgaged electric, gas, steam and/or hot water utility property and of certain automotive equipment an amount equal to $750,000 plus 2 percent of net additions to such depreciable mortgaged property made after June 30, 1945 and prior to the beginning of such year. Such requirement may be met with cash or gross property additions or by certifying net cash expenditures for certain automotive equipment or by taking credit for Bonds and qualified lien bonds retired. Any excess in such credits may be applied against future requirements. Such cash may be withdrawn on gross property additions or on waiver of the right to issue Bonds or be applied to the purchase or redemption of Bonds of such series as may be designated by the Company, including the New Bonds. (Mortgage, Sec. 39; Fourth Supplemental, Sec. 3.) - 6 - Special Provisions for Retirement of Bonds. If, during any 12 month period, mortgaged property is disposed of by order of or to any governmental authority resulting in the receipt of $5 million or more as proceeds, the Company (subject to certain conditions) must apply such proceeds, less certain deductions, to the retirement of Bonds. (Mortgage, Sec. 64.) Reference is made to the Prospectus Supplement for information concerning whether the New Bonds are redeemable for this purpose and, if so, at what redemption prices. Security. The New Bonds and any other Bonds now or hereafter issued under the Mortgage will be secured by the Mortgage, which constitutes, in the opinion of General Counsel for the Company, a first lien on all of the electric generating plants and other materially important physical properties of the Company and substantially all other properties described in the Corporate SecretaryMortgage as owned by the Company, subject to (a) leases of minor portions of the Company's property to others for uses which, in the opinion of such counsel, do not interfere with the Company's business, (b) leases of certain property of the Company not used in its electric utility business, and (c) excepted encumbrances, minor defects and irregularities, but such counsel has not examined title to or passed upon title to reservoir lands, easements or rights of way, any property not costing in excess of $25,000, or lands or rights held for flowage, flooding or seepage purposes, or riparian rights. There are excepted from the lien: cash and securities; merchandise, equipment, materials or supplies held for sale or other disposition; aircraft, automobiles and other vehicles, and materials and supplies for repairing and replacing the same; timber, minerals, mineral rights and royalties; receivables, contracts, leases and operating agreements. The Mortgage contains provisions for subjecting after-acquired property (subject to pre-existing liens) to the lien thereof, subject to limitations in the case of consolidation, merger or sale of substantially all of the Company's assets. The Mortgage provides that the Trustees shall have a lien upon the mortgaged property, prior to the Bonds, for the payment of their reasonable compensation, expenses and disbursements and for indemnity against certain liabilities. (Mortgage, Sec. 96.) No stocks or properties of subsidiaries are subject to the Mortgage. Issuance of Additional Bonds. The maximum principal amount of Bonds which may be issued under the Mortgage is not limited. Bonds of any series may be issued from time to time on the basis of: (1) 60 percent of property additions after adjustments to offset retirements; (2) retirement of Bonds or qualified lien bonds; and (3) deposit of cash. With certain exceptions in the case of (2) above, the issuance of Bonds requires adjusted net earnings before income taxes for 12 out of the preceding 15 months of at least twice the annual interest requirements on all Bonds at the time outstanding, including the additional issue, and on all indebtedness of prior rank. Such adjusted net earnings are computed after provision for retirement and depreciation of property equal to the replacement fund requirements for such period. It is expected that the New Bonds will be issued upon the basis of the retirement of Bonds or property additions. Property additions generally include electric, gas, steam or hot water property acquired after June 30, 1945, but may not include securities, aircraft, automobiles or other vehicles, or property used principally for the production or gathering of natural gas. There was available, as of December 31, 1996, unfunded net property additions of approximately $111,272,239. In general, when the Bonds of the 6-1/2% Series due January 1, 1998 have been retired, property additions theretofore funded to satisfy sinking or improvement funds and/or replacement funds for all series will revert to unfunded status, and such property additions, as well as any Bonds theretofore used to satisfy all series' sinking or improvement funds and/or replacement funds, will become available as a basis for the issuance of additional Bonds. The Company has reserved the right to amend the Mortgage without any consent or other action by holders of any series of Bonds (including the New Bonds) other than the Bonds of the 6-1/2% Series due January 1, 1998 so as to include nuclear fuel (and similar or analogous devices or substances) as property additions. - 7 - The Mortgage contains certain restrictions upon the issuance of Bonds against property subject to liens and upon the increase of the amount of such liens. (Mortgage, Sec. 4-8, 20-30, and 46; Fifth Supplemental, Sec. 2.) Release and Substitution of Property. Property may be released upon the basis of: (1) deposit of cash or, to a limited extent, purchase money mortgages; (2) property additions, after adjustments in certain cases to offset retirement and after making adjustments for qualified lien bonds outstanding against property additions; and/or (3) waiver of the right to issue Bonds without applying any earnings test. Cash may be withdrawn upon the bases stated in (2) and (3) above. When property released is not funded property, property additions used to effect the release may again, in certain cases, become available as credits under the Mortgage, and the waiver of the right to issue Bonds to effect the release may, in certain cases, cease to be effective as such a waiver. Similar provisions are in effect as to cash proceeds of such property. The Mortgage contains special provisions with respect to qualified lien bonds pledged, and disposition of moneys received on pledged prior lien bonds. (Mortgage, Sec. 5, 31, 32, 37, 46-50, 59-63, 100 and 118.) Dividend Covenant. The Company covenants that it will not declare or pay dividends (other than dividends payable in common stock) on or make any other distributions on or acquire (unless without cost to it) any of its common stock unless the provisions for depreciation and retirement of property during the period beginning September 1, 1945 to the date of the proposed payment, distribution or acquisition, plus earned surplus of the Company (including current net income available to be transferred to earned surplus) remaining: (a) after such payment, distribution or acquisition; and (b) after deducting any remainder of the amount of earned surplus of the Company as Rights Agent. The description of August 31, 1945, after deducting from such amount the Rights set forth below does not purportcharges to earned surplus subsequent to August 31, 1945, other than charges occasioned by dividends (other than dividends payable in common stock) on its common stock or occasioned by other distributions on or acquisitions of its common stock and other than charges to earned surplus with corresponding credits to reserve for depreciation and retirement of property; shall be complete and is qualified in its entirety by reference to the Rights Plan. Reference is also made to the laws of the State of Minnesota. On July 24, 1996, the Board of Directors of the Company declared a dividend distribution of one Right for each outstanding share of Common Stock to shareholders of record at the close of business on July 24, 1996 (Record Date) and authorized the issuance of one Right with respect to each share of Common Stock that becomes outstanding between the Record Date and July 23, 2006 or such earlier time as the Rights are redeemed. Except as described below, each Right, when exercisable, entitles the registered holder to purchase from the Company one one-hundredth of a share of Junior Serial Preferred Stock A, without par value (Serial Preferred), at a price of $90 per one one-hundredth share (the Purchase Price), subject to adjustment. Initially, the Rights will attach to all Common Stock certificates representing shares then outstanding, and no separate Right Certificates will be distributed. The Rights will be evidenced by the Common Stock certificates together with a copy of the Summary of Rights Plan and not by separate certificates until the earlier to occur of (i) 10 days following a public announcement that a person or group of affiliated or associated persons (an Acquiring Person) has acquired, or obtained the right to acquire, beneficial ownership of 15 percent or more of the outstanding shares of Common Stock (the Stock Acquisition Date) or (ii) 15 business days (or such later date as may be determined by action of the Board of Directors prior to the time that any person becomes an Acquiring Person) following the commencement of (or a public announcement of an intention to make) a tender or exchange offer if, upon consummation thereof, such person or group would be the beneficial owner of 15 percent or more of such outstanding shares of Common Stock (the earlier of such dates being called the Distribution Date). -7- Until the Distribution Date, the Rights will be transferred with and only with the Common Stock. Until the Distribution Date (or earlier redemption, expiration or termination of the Rights), the transfer of any certificates for Common Stock, with or without a copy of the Summary of Rights Plan, will also constitute the transfer of the Rights associated with the Common Stock represented by such certificates. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights (Right Certificates) will be mailed to holders of record of the Common Stock as of the close of business on the Distribution Date and, thereafter, such separate Right Certificates alone will evidence the Rights. Each whole share of Serial Preferred will have a minimum preferential quarterly dividend rateleast equal to the greateramount of $51 per share or, subject to anti-dilution adjustment, 100 times the dividend declared on the Common Stock. In the event of liquidation, no distribution will be made to the holders of Common Stock unless, prior thereto, the holders of the Serial Preferred have received a liquidation preference of $100 per share, plus accrued and unpaid dividends. Holders of the Serial Preferred will be entitled to notice of and to vote atreplacement fund requirements, if any, meetingfor such period. (See Replacement Fund.) (Mortgage, Sec. 39.) None of the Company's shareholders. Each whole shareretained earnings as of Serial Preferred is entitled to one vote. Such shares do not have cumulative voting rights. The Serial Preferred, together with the issued and outstanding shares of the other Preferred Stocks of the Company, will be expressly entitled, as one class, to elect a majority of directors (the Common Stock electing the minority) whenever dividends on any of the Preferred Stocks shall be in default in the amount of four quarterly payments and thereafter until all such dividends in default shall have been paid. In the event of any merger, consolidation or other transaction in which shares of Common Stock are exchanged for or converted into other securities and/or property, each whole share of Serial Preferred will be entitled to receive, subject to anti-dilution adjustment, 100 times the amount into which or for which each share of Common Stock is so exchanged or converted. The shares of Serial Preferred are not redeemable by the Company. The Rights are not exercisable until the Distribution Date and will expire at the earliest of (i) July 23, 2006 (Final Expiration Date), (ii) the redemption of the Rights by the Company as described below, and (iii) the exchange of all Rights for Common Stock as described below. In the event that any person (other than the Company, its affiliates or any person receiving newly-issued shares of Common Stock directly from the Company) becomes the beneficial owner of 15 percent or more of the then outstanding shares of Common Stock, each holder of a Right will thereafter have a right to receive, upon exercise at the then current exercise price of the Right, Common Stock (or, in certain circumstances, cash, property or other securities of the Company) having a value equal to two times the exercise price of the Right. The Rights Plan contains an exemption for any issuance of Common Stock by the Company directly to any person (for example, in a private placement or an acquisition by the Company in which Common Stock is used as consideration), even if that person would become the beneficial owner of 15 percent or more of the Common Stock, provided that such person does not acquire any additional shares of Common Stock. In the event that, at any time following the Stock Acquisition Date, the Company is acquired in a merger or other business combination transaction or 50 percent or more of the Company's assets or earning power are sold, proper provision will be made so that each holder of a Right will thereafter have the right to receive, upon exercise at the then current exercise price of the Right, common stock of the acquiring or surviving company having a value equal to two times the exercise price of the Right. Notwithstanding the foregoing, following the occurrence of any of the events set forth in the preceding two paragraphs (the Triggering Events), any Rights that are, or (under certain circumstances specified in the Rights Plan) were, beneficially owned by any Acquiring Person will immediately become null and void. The Purchase Price payable, and the number of shares of Serial Preferred or other securities or property issuable, upon exercise of the Rights, are subject to adjustment from time to time to prevent dilution, among other circumstances, in the event of a stock dividend on, or a subdivision, split, combination, consolidation or reclassification of, the Serial Preferred or the Common Stock, or a reverse split of the outstanding shares of Serial Preferred or the Common Stock. At any time after the acquisition by a person or group of affiliated or associated persons of beneficial ownership of 15 percent or more of the outstanding Common Stock and prior to the acquisition by such -8- person or group of 50 percent or more of the outstanding Common Stock, the Board of Directors may exchange the Rights (other than Rights owned by such person or group, which have become void), in whole or in part, at an exchange ratio of one share of Common Stock per Right (subject to adjustment). With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least one percent in the Purchase Price. The Company will not be required to issue fractional shares of Serial Preferred or Common Stock (other than fractions in multiples of one one-hundredths of a share of Serial Preferred) and, in lieu thereof, an adjustment in cash may be made based on the market price of the Serial Preferred or Common Stock on the last trading date prior to the date of exercise. At any time after the date of the Rights Plan until the time that a person becomes an Acquiring Person, the Board of Directors may redeem the Rights in whole, but not in part, at a price of $.01 per Right (Redemption Price), which may (at the option of the Company) be paid in cash, shares of Common Stock or other consideration deemed appropriate by the Board of Directors. Upon the effectiveness of any action of the Board of Directors ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. Issuance of Serial Preferred or Common Stock upon exercise of the Rights will be subject to any necessary regulatory approvals. Until a Right is exercised, the holder thereof, as such, will have no rights as a shareholder of the Company, including, without limitation, the right to vote or to receive dividends. One million shares of Serial Preferred will be reserved for issuance in the event of exercise of the Rights. The provisions of the Rights Plan may be amended by the Company, except that any amendment adopted after the time that a person becomes an Acquiring Person may not adversely affect the interests of holders of Rights. The Rights have certain anti-takeover effects. The Rights will cause substantial dilution to a person or group that attempts to acquire the Company without conditioning the offer on the Rights being redeemed or a substantial number of Rights being acquired, and under certain circumstances the Rights beneficially owned by such a person or group may become void. The Rights should not interfere with any merger or other business combination approved by the Board of Directors because, if the Rights would become exercisableSeptember 30, 1996 was restricted as a result of such mergerprovisions. Modification of business combination, the BoardMortgage. The rights of DirectorsBondholders may at its option, atbe modified with the consent of the holders of 70 percent of the Bonds and, if less than all series of Bonds are affected, the consent also of the holders of 70 percent of the Bonds of each series affected. The Company has reserved the right without any time priorconsent or other action by the holders of any series of Bonds (including the New Bonds) other than the Bonds of the 6-1/2% Series due January 1, 1998 to amend the Mortgage so as to substitute 66 2/3 percent for 70 percent in the foregoing provisions. In general, no modification of the terms of payment of principal and interest, no modification of the obligations of the Company under Section 64 and no modification affecting the lien or reducing the percentage required for modification, is effective against any Bondholder without his consent. (Mortgage, Art. XIX; Fifth Supplemental, Sec. 3.) Defaults and Notice Thereof. Defaults are defined as being default in payment of principal; default for 60 days in payment of interest or of installments of funds for retirement of Bonds; certain defaults with respect to qualified lien bonds and certain events in bankruptcy, insolvency or reorganization; and default of 90 days after notice in other covenants. (Mortgage, Sec. 65.) The Trustees may withhold notice of default (except in payment of principal, interest or funds for retirement of Bonds) if they think it is in the interest of the bondholders. (Mortgage, Sec. 66.) Under the Trust Indenture Act of 1939, as amended, general periodic evidence is required to be furnished as to compliance with the conditions and covenants under the Mortgage. The Corporate Trustee or the holders of 25 percent of the Bonds may declare the principal and interest due on default, but a majority may annul such declaration if the default has been cured. (Mortgage, - 8 - Sec. 67.) No holder of Bonds may enforce the lien of the Mortgage without giving the Trustees written notice of a default and unless holders of 25 percent of the Bonds have requested the Trustees to act and offered them reasonable opportunity to act and indemnity satisfactory to the time that any person becomes an Acquiring Person, redeem all (but not less than all)Trustees and they shall have failed to act. (Mortgage, Sec. 80.) The holders of a majority of the then outstanding Rights atBonds may direct the Redemption Price. Expertstime, method and place of conducting any proceedings for any remedy available to the Trustees, or exercising any trust or power conferred upon the Trustees, but the Trustees are not required to follow such direction if not sufficiently indemnified for expenditures. (Mortgage, Sec. 71.) EXPERTS The Company's consolidated financial statements incorporated in this Prospectus by reference to the Company's 1995 Form 10-K, except as they relate to ADESA, have been audited by Price Waterhouse LLP, independent accountants, and, insofar as they relate to ADESA, by Ernst & Young LLP, independent auditors. Such financial statements, except as they relate to ADESA, have been so incorporated in reliance on the report of Price Waterhouse LLP, given on the authority of said firm as experts in auditing and accounting. The financial statement schedule incorporated in this Prospectus by reference to the Company's 1995 Form 10-K has been so incorporated in reliance on the report of Price Waterhouse LLP, independent accountant,accountants, given on the authority of said firm as experts in auditing and accounting. The consolidated financial statements of ADESA for the period from July 1, 1995 to December 31, 1995 which are included in the consolidated financial statements of the Company incorporated in this Prospectus by reference to the Company's 1995 Form 10-K have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included in said 1995 Form 10-K. The consolidated financial statements of ADESA for the period from July 1, 1995 to December 31, 1995 are included in the consolidated financial statements of the Company in reliance upon such report given upon the authority of such firm as experts in accounting and auditing. -9- The statements asLegal conclusions and opinions specifically attributed to mattersGeneral Counsel herein under Description of law and legal conclusions under "Description of Common Stock" and "Description of Preferred Share Purchase Rights" in this ProspectusNew Bonds and in the documents incorporated herein by referenceIncorporated Documents have been reviewed by Philip R. Halverson, Esq., Duluth, Minnesota, Vice President, General Counsel and Corporate Secretary of the Company, and are set forth or incorporated by reference herein in reliance upon his opinion given upon his authority as an expert. As of AugustDecember 31, 1996 Mr. Halverson owned approximately 4,1104,432 shares of the Common Stock of the Company. Mr. Halverson is regularly acquiring additional shares of Common Stock as a participant in the Company's Employee Stock Purchase Plan, Employee Stock Ownership Plan and Supplemental Retirement Plan. Legal OpinionsLEGAL OPINIONS The legality of the Shares offered herebyNew Bonds will be passed upon for the Company by Mr. Halverson and by Reid & Priest LLP, New York, New York, counsel for the Company.Company, and for any underwriter, dealer or agent by Lane & Mittendorf LLP, New York, New York. Reid & Priest LLP and Lane & Mittendorf LLP may rely as to all matters of Minnesota law upon the opinion of Mr. Halverson. PlanPLAN OF DISTRIBUTION The Company may sell the New Bonds in any of Distributionthree ways: (i) through underwriters or dealers; (ii) directly to a limited number of institutional purchasers or to a single purchaser; or (iii) through agents. The SharesProspectus Supplement relating to the Offered Bonds will set forth the terms of the offering of the Offered Bonds, including the name or names of any underwriters, dealers or agents, the purchase price of the Offered Bonds and the net proceeds to the Company from such sale, any underwriting discounts and other items constituting underwriters' compensation, any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be offered pursuantchanged from time to this Prospectustime. - 9 - If underwriters are fully paid and nonassessable andused in any sale of the New Bonds, the Offered Bonds will be offered and soldacquired by the Selling Shareholdersunderwriters for their own accounts. The Company will not receive any of the proceeds from such sales. The Selling Shareholdersaccount and may offer and sell the Sharesbe resold from time to time in one or more transactions, including negotiated transactions, at marketa fixed public offering price or at varying prices prevailingdetermined at the time of salesale. The underwriter or at negotiated prices. Sales may be made to or through broker-dealers who may receive compensation in the form of discounts, concessions or commissions from the Selling Shareholders and/or the purchasers of Shares for whom such broker-dealers may act as agents and/or to whom they may sell as principals, or both (which compensation asunderwriters with respect to a particular broker-dealerunderwritten offering of Offered Bonds will be named in the Prospectus Supplement relating to such offering and, if an underwriting syndicate is used, the managing underwriter or underwriters will be set forth on the cover page of such Prospectus Supplement. Unless otherwise set forth in the Prospectus Supplement, the obligations of the underwriter or underwriters to purchase the Offered Bonds will be subject to certain conditions precedent and the underwriter or underwriters will be obligated to purchase all the Offered Bonds if any are purchased except that, in certain cases involving a default by one or more underwriters, less than all of the Offered Bonds may be purchased. Offered Bonds may be sold directly by the Company or through agents designated by the Company from time to time. Any agent involved in excessthe offer or sale of customary commissions). When required,the Offered Bonds in respect of which this Prospectus is delivered will be supplementednamed, and any commissions payable by the Company to such agent will be set forth, in the Prospectus Supplement. Unless otherwise indicated in the Prospectus Supplement, any such agent will be acting on a best efforts basis for the period of its appointment. If so indicated in the Prospectus Supplement, the Company will authorize agents, underwriters or dealers to solicit offers by certain specified institutions to purchase Offered Bonds from the Company at the public offering price to be set forth in the Prospectus Supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. Such contracts will be subject to those conditions set forth in the Prospectus Supplement, and the Prospectus Supplement will set forth the namecommission payable for solicitation of such contracts. Subject to certain conditions, agents and underwriters may be entitled under agreements entered into with the Company to indemnification by the Company against certain civil liabilities, including liabilities under the Securities Act of 1933, as amended, arising out of or namesbased upon, among other things, any untrue statement or alleged untrue statement of a material fact contained in the registration statement, this Prospectus, a Prospectus Supplement or the Incorporated Documents or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the Selling Shareholders for whose account a particular offeringcircumstances under which they were made, not misleading. See the Prospectus Supplement. - 10 - ====================================================================== NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPEC- TUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF OR THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH THEY RELATE. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. ------------------------- TABLE OF CONTENTS PAGE ---- Available Information . . . . . . . . . . . . . . . . . . . . . 2 Incorporation of Shares isCertain Documents by Reference . . . . . . . . . . . . . . . . . . . . . . . . 2 The Company . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Application of Proceeds . . . . . . . . . . . . . . . . . . . . 5 Ratios of Earnings to be made, the numberFixed Charges . . . . . . . . . . . . . . 5 Supplemental Ratios of Shares so offered for such Selling Shareholders' account and, if such offering isEarnings to be made by or through underwriters or dealers, the namesFixed Charges . . . . . . . . . . . . . . . . . . . . . . . . 5 Description of such underwriters or dealers and the principal termsNew Bonds . . . . . . . . . . . . . . . . . . . 6 Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . 9 Plan of the arrangements between the underwriters or dealers and the Selling Shareholders. The Selling Shareholders and any broker-dealers acting in connection with the sale of the Shares hereunder may be deemed to be "underwriters" within the meaning of Section 2(11) of the 1933 Act, and any commissions received by them and any profit realized by them on the resale of Shares as principals may be deemed underwriting compensation under the 1933 Act. Expenses in connection with the registration of the Shares under the 1933 Act, including legal and accounting fees of the Company, will be paid by the Company. ---------------------- No person has been authorized to give any information or to make any representations in connection with this offering other than those contained in this Prospectus and, if given or made, such other information and representations must not be relied upon as having been authorized by the Company. Neither the delivery of this Prospectus nor any such sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date hereof or that the information contained herein is correct as of any time subsequent to its date. This Prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities other than the registered securities to which it relates. This Prospectus does not constitute an offer to sell or a solicitation of an offer to buy such securities in any circumstances in which such offer or solicitation is unlawful. -10-Distribution . . . . . . . . . . . . . . . . . . . . . 9 ====================================================================== ====================================================================== $80,000,000 MINNESOTA POWER & LIGHT COMPANY FIRST MORTGAGE BONDS -------------- PROSPECTUS -------------- , 1997 ---------- ====================================================================== PART II. Information Not Required in Prospectus ItemINFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. Other Expenses of Issuance and Distribution.OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The expenses in connection with the issuance and distribution of the securities being registered other than underwriting compensation are: Filing Feefee - Securities and Exchange Commission . . . . . $ 4,312 Stock exchange listing fee 1,50022,728 Minnesota Mortgage Registration Tax . . . . . . . . . . . 175,000 Fees of Trustees, including authentication and counsel charges . . . . . . . . . . . . . . . . . . 30,000 Fees of Company's legal counsel * 12,500 Independent accountants'. . . . . . . . . . . . . 80,000 Auditors' fees *. . . . . . . . . . . . . . . . . . . . . 17,500 Printing, including Form S-3, prospectus, exhibits, etc. . . . . . . . . . . . . . . . . . . . . 15,000 Printing securities . . . . . . . . . . . . . . . . . . . 5,000 Rating agencies' fees . . . . . . . . . . . . . . . . . . 40,000 Miscellaneous expenses * 1,688 --------- * Total $ 25,000 ========= - ----------------. . . . . . . . . . . . . . . . . 24,772 -------- *Total . . . . . . . . . . . . . . . . . . . . . . . . $410,000 ======== --------------- * Estimated ItemITEM 15. Indemnification of Directors and Officers.INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 302A.521 of the Minnesota Business Corporation Act generally provides for the indemnification of directors, officers or employees of a corporation made or threatened to be made a party to a proceeding by reason of the former or present official capacity of the person against judgments, penalties and fines (including attorneys' fees and disbursements) where such person, among other things, has not been indemnified by another organization, acted in good faith, received no improper personal benefit and with respect to any criminal proceeding, had no reasonable cause to believe his conduct was unlawful. Section 13 of the Bylaws of the Company contains the following provisions relative to indemnification of directors and officers: "The Company shall reimburse or indemnify each present and future director and officer of the Company (and his or her heirs, executors and administrators) for or against all expenses reasonably incurred by such director or officer in connection with or arising out of any action, suit or proceeding in which such director or officer may be involved by reason of being or having been a director or officer of the Company. Such indemnification for reasonable expenses is to be to the fullest extent permitted by the Minnesota Business Corporation Act, Minnesota Statutes Chapter 302A. By affirmative vote of the Board of Directors or with written approval of the Chairman and Chief Executive Officer, such indemnification may be extended to include agents and employees who are not directors or officers of the Company, but who would otherwise be indemnified for acts and omissions under Chapter 302A of the Minnesota Business Corporation Act, if such agent or employee were an officer of the Company." "Reasonable expenses may include reimbursement of attorney's fees and disbursements, including those incurred by a person in connection with an appearance as a witness." II-1 "Upon written request to the Company and approval by the Chairman and Chief Executive Officer, an agent or employee for whom indemnification has been extended, or an officer or director may receive an advance for reasonable expenses if such agent, employee, officer or director is made or threatened to be made a party to a proceeding involving a matter for which indemnification is believed to be available under Minnesota Statutes Chapter 302A." "The foregoing rights shall not be exclusive of other rights to which any director or officer may otherwise be entitled and shall be available whether or not the director or officer continues to be a director or officer at the time of incurring such expenses and liabilities." The Company has insurance covering its expenditures which might arise in connection with the lawful indemnification of its directors and officers for their liabilities and expenses, and insuring officers and directors of the Company against certain other liabilities and expenses. II-1 ItemITEM 16. Exhibits Exhibit NumberEXHIBITS. 1 - ------- * 4(a)Form of Underwriting Agreement. +4(a)1 - Articles of Incorporation, restated as of July 27, 1988 (filed as Exhibit 3(a), File No. 33-24936). * 4(a)+4(a)2 - Certificate Fixing Terms of Serial Preferred Stock A, $7.125 Series (filed as Exhibit 3(a)2, File No. 33-50143). * 4(a)+4(a)3 - Certificate Fixing Terms of Serial Preferred Stock A, $6.70 Series (filed as Exhibit 3(a)3, File No. 33-50143). * 4(b)+4(b) - Bylaws as amended January 23, 1991 (filed as Exhibit 3(b), File No.33-45549)No. 33-45549). * 4(c)+4(c)1 - Mortgage and Deed of Trust, dated as of September 1, 1945, between the Company and Irving Trust Company (now The Bank of New York) and Richard H. West (W.T.(W. T. Cunningham, successor), as Trustees (filed as Exhibit 7(c), File No. 2-5865). * 4(c)+4(c)2 - Supplemental Indentures to Mortgage and Deed of Trust: Reference --------- Number Dated as of Reference File Exhibit ------ ----------- ------------------------ ---- ------- First March 1, 1949 2-7826 7(b) Second July 1, 1951 2-9036 7(c) Third March 1, 1957 2-13075 2(c) Fourth January 1, 1968 2-27794 2(c) Fifth April 1, 1971 2-39537 2(c) Sixth August 1, 1975 2-54116 2(c) Seventh September 1, 1976 2-57014 2(c) Eighth September 1, 1977 2-59690 2(c) Ninth April 1, 1978 2-60866 2(c) Tenth August 1, 1978 2-62852 2(d)2 II-2 Eleventh December 1, 1982 2-56649 4(a)3 Twelfth April 1, 1987 33-30224 4(a)3 Thirteenth March 1, 1992 33-47438 4(b) Fourteenth June 1, 1992 33-55240 4(b) Fifteenth July 1, 1992 33-55240 4(c) Sixteenth July 1, 1992 33-55240 4(d) Seventeenth February 1, 1993 33-50143 4(b) Eighteenth July 1, 1993 33-50143 4(c) * 4(d) - Form of Supplemental Indenture relating to the New Bonds. +4(e) - Mortgage and Deed of Trust, dated as of March 1, 1943, between Superior Water, Light and Power Company and Chemical Bank & Trust Company (Chemical Bank, successor) and Howard B. Smith, (Steven F. Lasher, successor), as Trustees (First Bank N.A., successor Trustee) (filed as Exhibit 7(c), File No. 2-8668), as supplemented and modified by First Supplemental Indenture thereto dated as of March 1, 1951 (filed as Exhibit 2(d)(1), File No. 2-59690)2- 59690), Second Supplemental Indenture thereto dated as of March 1, 1962 (filed as Exhibit 2(d)1, File No. 2-27794), Third Supplemental Indenture thereto dated as of July 1, 1976 (filed as Exhibit 2(e)1, File No. 2-57478), Fourth Supplemental Indenture thereto dated as of March 1, 1985 (filed as Exhibit 4(b), File No. 2-78641), and Fifth Supplemental Indenture thereto, dated as of December 1, 1992 (filed as Exhibit 4(b)1 to Form 10-K for the year ended December 31, 1992, File No. 1-3548). * 4(e)+4(f) - Amended and Restated Trust Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company, as Depositor, and The Bank of New York, The Bank of New York (Delaware), Philip R. Halverson, David G. Gartzke and James K. Vizanko, as Trustees (filed as Exhibit 4(a) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). II-2 Exhibit Number - ------- * 4(f)+4(g) - Amendment No. 1, dated April 11, 1996, to Amended and Restated Trust Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities (filed as Exhibit 4(b) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). * 4(g)+4(h) - Indenture, dated as of March 1, 1996, relating to the Company's 8.05% Junior Subordinated Debentures, Series A, Due 2015, between the Company and The Bank of New York, as Trustee (filed as Exhibit 4(c) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). * 4(h)+4(i) - Guarantee Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company, as Guarantor, and The Bank of New York, as Trustee (filed as Exhibit 4(d) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). * 4(i)+4(j) - Agreement as to Expenses and Liabilities dated as of March 20, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company and MP&L Capital I (filed as Exhibit 4(e) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). * 4(j)II-3 +4(k) - Rights Agreement dated as of July 24, 1996 between Minnesota Power & Light Company and the Corporate Secretary of Minnesota Power & Light Company, as Rights Agent, including Exhibit A - Form of Certificate of Resolution Fixing Terms of Junior Serial Preferred Stock A, Exhibit B - Form of Right Certificate and Exhibit C - Summary of the Rights Plan (filed as Exhibit 4 to Form 8-K dated August 2, 1996, File No. 1-3548). 5(a) - Opinion and Consent of Philip R. Halverson, Esq., Vice President, General Counsel and Corporate Secretary of the Company. 5(b) - Opinion and Consent of Reid & Priest LLP. 12 - Computation of Ratios of Earnings to Fixed Charges and Supplemental Ratios of Earnings to Fixed Charges. 23(a) - Consent of Price Waterhouse LLP. 23(b) - Consent of Ernst & Young LLP. 23(c) - Consents of Philip R. Halverson, Esq., and Reid & Priest LLP are contained in Exhibits 5(a) and 5(b), respectively. 24 - Power of Attorney (see page II-5)II-6). 25(a) - ------------------------- *Statement on Form T-1 of The Bank of New York. 25(b) - Statement on Form T-2 of W.T. Cunningham. ------------------- + Incorporated herein by reference as indicated. II-3 ItemITEM 17. Undertakings.UNDERTAKINGS. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percentII-4 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. Provided, however, that paragraphs (i) and (ii) do not apply if the registration statement is on Form S-3, Form S-8 or Form S-8F-3, and the information required to be included in a post-effectivepost- effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (5) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-4II-5 Power of AttorneyPOWER OF ATTORNEY Each person whose signature appears below hereby authorizes any agent for service named in this registration statement to execute in the name of each such person, and to file with the Securities and Exchange Commission, any and all amendments, including post-effective amendments, to the registration statement, and appoints any such agent for service as attorney-in-fact to sign in each such person's behalf individually and in each capacity stated below and file any such amendments to the registration statement and the registrant hereby also appoints each such agent for service as its attorney-in-fact with like authority to sign and file any such amendments in its name and behalf. SignaturesSIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Duluth, State of Minnesota, on October 4, 1996.January 29, 1997. MINNESOTA POWER & LIGHT COMPANY (Registrant) By /s/ Edwin L. Russell ---------------------------------------------------------------- Edwin L. Russell Chairman, President and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated. Signature Title DateSIGNATURE TITLE DATE --------- ----- ---- Edwin L. Russell October 4, 1996 - ---------------------------------/s/ Edwin L. Russell Chairman, President, January 29, 1997 ------------------------- Chief Executive Edwin L. Russell Officer Chairman, President, and Director Chief Chief Executive Officer Executive Officer and Director and Director D.G. Gartzke October 4, 1996 - --------------------------------- D.G./s/ D. G. Gartzke Senior Vice President- January 29, 1997 ------------------------- Finance and D. G. Gartzke Chief Financial Senior Vice President-Finance Finance andOfficer and Chief Financial Officer Chief Financial Officer Mark A. Schober October 4, 1996 - ---------------------------------/s/ Mark A. Schober Corporate Controller January 29, 1997 ------------------------- Mark A. Schober Corporate Controller II-5II-6 Signature Title DateSIGNATURE TITLE DATE --------- ----- ---- /s/ Merrill K. Cragun Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------- Merrill K. Cragun /s/ Dennis E. Evans Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------- Dennis E. Evans /s/ Peter J. Johnson Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------- Peter J. Johnson Jack R. Kelly, Jr. Director October 4, 1996 - --------------------------------- Jack R. Kelly, Jr./s/ George L. Mayer Director October 4, 1996 - ---------------------------------January 29, 1997 -------------------------- George L. Mayer /s/ Paula F. McQueen Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------- Paula F. McQueen /s/ Robert S. Nickoloff Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------- Robert S. Nickoloff /s/ Jack I. Rajala Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------ Jack I. Rajala /s/ Arend J. Sandbulte Director October 4, 1996 - ---------------------------------January 29, 1997 ----------------------- Arend J. Sandbulte /s/ Nick Smith Director October 4, 1996 - ---------------------------------January 29, 1997 ----------------------- Nick Smith /s/ Bruce W. Stender Director October 4, 1996 - ---------------------------------January 29, 1997 ----------------------- Bruce W. Stender /s/ Donald C. Wegmiller Director October 4, 1996 - ---------------------------------January 29, 1997 ------------------------ Donald C. Wegmiller II-6II-7 EXHIBIT INDEX Exhibit Index Exhibit Number Description - ------- ----------- 1 - Form of Underwriting Agreement. +4(a)1 - Articles of Incorporation, restated as of July 27, 1988 (filed as Exhibit 3(a), File No. 33-24936). +4(a)2 - Certificate Fixing Terms of Serial Preferred Stock A, $7.125 Series (filed as Exhibit 3(a)2, File No. 33-50143). +4(a)3 - Certificate Fixing Terms of Serial Preferred Stock A, $6.70 Series (filed as Exhibit 3(a)3, File No. 33-50143). +4(b) - Bylaws as amended January 23, 1991 (filed as Exhibit 3(b), File No. 33-45549). +4(c)1 - Mortgage and Deed of Trust, dated as of September 1, 1945, between the Company and Irving Trust Company (now The Bank of New York) and Richard H. West (W. T. Cunningham, successor), as Trustees (filed as Exhibit 7(c), File No. 2-5865). +4(c)2 - Supplemental Indentures to Mortgage and Deed of Trust: Reference --------- Number Dated as of File Exhibit ------ ---------- ---- ------- First March 1, 1949 2-7826 7(b) Second July 1, 1951 2-9036 7(c) Third March 1, 1957 2-13075 2(c) Fourth January 1, 1968 2-27794 2(c) Fifth April 1, 1971 2-39537 2(c) Sixth August 1, 1975 2-54116 2(c) Seventh September 1, 1976 2-57014 2(c) Eighth September 1, 1977 2-59690 2(c) Ninth April 1, 1978 2-60866 2(c) Tenth August 1, 1978 2-62852 2(d)2 Eleventh December 1, 1982 2-56649 4(a)3 Twelfth April 1, 1987 33-30224 4(a)3 Thirteenth March 1, 1992 33-47438 4(b) Fourteenth June 1, 1992 33-55240 4(b) Fifteenth July 1, 1992 33-55240 4(c) Sixteenth July 1, 1992 33-55240 4(d) Seventeenth February 1, 1993 33-50143 4(b) Eighteenth July 1, 1993 33-50143 4(c) 4(d) - Form of Supplemental Indenture relating to the New Bonds. +4(e) - Mortgage and Deed of Trust, dated as of March 1, 1943, between Superior Water, Light and Power Company and Chemical Bank & Trust Company and Howard B. Smith, as Trustees (First Bank N.A., successor Trustee) (filed as Exhibit 7(c), File No. 2-8668), as supplemented and modified by First Supplemental Indenture thereto dated as of March 1, 1951 (filed as Exhibit 2(d)(1), File No. 2- 59690), Second Supplemental Indenture thereto dated as of March 1, 1962 (filed as Exhibit 2(d)1, File No. 2-27794), Third Supplemental Indenture thereto dated as of July 1, 1976 (filed as Exhibit 2(e)1, File No. 2-57478), Fourth Supplemental Indenture thereto dated as of March 1, 1985 (filed as Exhibit 4(b), File No. 2-78641), and Fifth Supplemental Indenture thereto, dated as of December 1, 1992 (filed as Exhibit 4(b)1 to Form 10-K for the year ended December 31, 1992, File No. 1-3548). +4(f) - Amended and Restated Trust Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company, as Depositor, and The Bank of New York, The Bank of New York (Delaware), Philip R. Halverson, David G. Gartzke and James K. Vizanko, as Trustees (filed as Exhibit 4(a) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). +4(g) - Amendment No. 1, dated April 11, 1996, to Amended and Restated Trust Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities (filed as Exhibit 4(b) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). +4(h) - Indenture, dated as of March 1, 1996, relating to the Company's 8.05% Junior Subordinated Debentures, Series A, Due 2015, between the Company and The Bank of New York, as Trustee (filed as Exhibit 4(c) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). +4(i) - Guarantee Agreement, dated as of March 1, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company, as Guarantor, and The Bank of New York, as Trustee (filed as Exhibit 4(d) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). +4(j) - Agreement as to Expenses and Liabilities dated as of March 20, 1996, relating to MP&L Capital I's 8.05% Cumulative Quarterly Income Preferred Securities, between the Company and MP&L Capital I (filed as Exhibit 4(e) to Form 10-Q for the quarter ended March 31, 1996, File No. 1-3548). +4(k) - Rights Agreement dated as of July 24, 1996 between Minnesota Power & Light Company and the Corporate Secretary of Minnesota Power & Light Company, as Rights Agent, including Exhibit A - Form of Certificate of Resolution Fixing Terms of Junior Serial Preferred Stock A, Exhibit B - Form of Right Certificate and Exhibit C - Summary of the Rights Plan (filed as Exhibit 4 to Form 8-K dated August 2, 1996, File No. 1-3548). 5(a) - Opinion and Consent of Philip R. Halverson, Esq., Vice President, General Counsel and Corporate Secretary of the Company. 5(b) - Opinion and Consent of Reid & Priest LLP. 12 - Computation of Ratios of Earnings to Fixed Charges and Supplemental Ratios of Earnings to Fixed Charges. 23(a) - Consent of Price Waterhouse LLP. 23(b) - Consent of Ernst & Young LLP. 23(c) - Consents of Philip R. Halverson, Esq., and Reid & Priest LLP are contained in Exhibits 5(a) and 5(b), respectively. 24 - Power of Attorney (see page II-5)II-6). 25(a) - Statement on Form T-1 of The Bank of New York. 25(b) - Statement on Form T-2 of W.T. Cunningham. ------------------- + Incorporated herein by reference as indicated.