As filed with the Securities and Exchange Commission on February 4, 2000
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
SOUTHWESTERN ELECTRIC POWER COMPANY
(Exact name of registrant as specified in its charter)
Delaware 72-0323455
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
428 Travis Street
Shreveport, Louisiana 71156-0001
(318) 673-3000
(Address, including zip code, and telephone
number, including area code, of registrant's
principal executive offices)
Wendy G. Hargus
Treasurer
Southwestern Electric Power Company
c/o Central and South West Corporation
1616 Woodall Rogers Freeway
Dallas, Texas 75202
(214) 777-1000
(Names, address, including zip codes, and telephone numbers, including area
codes, of agents for service)
Copies to:
Robert B. Williams, Esq.
Joris M. Hogan, Esq.
Milbank, Tweed, Hadley & McCloy LLP
1 Chase Manhattan Plaza
New York, New York 10005
(212) 530-5000
Approximate date of commencement of proposed sale to the public: From time
to time 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, as amended, other than securities offered only in connection with
dividend or interest reinvestment plans, please check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act 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, check the following box and list the Securities Act
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. |_|
CALCULATION OF REGISTRATION FEE
Proposed Proposed Maximum
Title of Each Maximum Aggregate Offering Amount of
Class of Amount to Offering Price Registration
Securities to be be Registered Price Per Fee
Registered Unit
Senior Notes $250,000,000 100% $250,000,000 $66,000
Estimate solely for the purpose of calculating the registration fee.
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 the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
Subject to Completion, Dated February ,2000
PROSPECTUS
SOUTHWESTERN ELECTRIC POWER COMPANY
$250,000,000
SENIOR NOTES
Southwestern Electric Power Company produces, purchases, transmits,
distributes and sells electricity to approximately 422,000 customers in
northeastern Texas, northwestern Louisiana and western Arkansas. We are a
wholly-owned subsidiary of Central and South West Corporation, a Dallas-based
diversified utility holding company.
We intend to offer from time to time in one or more series up to
$250,000,000 of debentures, notes or other types of senior unsecured debt
securities known as Senior Notes.
When we offer a particular series of Senior Notes, we will prepare and
issue a supplement to this prospectus setting forth the particular terms of the
offered Senior Notes, including the amounts, prices and other terms of the
series. Each supplement is called a prospectus supplement. You should read this
prospectus and any prospectus supplement carefully before you make any decision
to invest in the Senior Notes.
These securities have not been approved or disapproved by the Securities and
Exchange Commission or any state securities commission nor have any of these
organizations determined that this prospectus is accurate or complete.
Any representation to the contrary is a criminal offense.
We may offer the Senior Notes directly or through underwriters, agents
or dealers. Each prospectus supplement will provide the terms of the plan of
distribution relating to the respective series of Senior Notes.
"Plan of Distribution" below also provides more information on this topic.
The date of this prospectus is ,2000.
WHERE YOU CAN FIND MORE INFORMATION
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with
the Securities and Exchange Commission, or SEC, utilizing a "shelf" registration
process. Under this shelf process, we may sell the Senior Notes described in
this prospectus in one or more offerings up to a total dollar amount of
$250,000,000. This prospectus provides a general description of the Senior Notes
being offered. Each time we sell a series of Senior Notes we will provide a
prospectus supplement containing specific information about the terms of that
series of Senior Notes and the related offering. It is important for you to
consider the information contained in this prospectus and the related prospectus
supplement together with additional information described under the heading
"Documents Incorporated by Reference" in making your investment decision.
We are subject to the informational requirements of the Securities Act
of l934, and therefore we file annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy the
registration statement, with exhibits, as well as the reports and other
information we file with the SEC, at the SEC's public reference facilities at
its principal offices at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549 and its regional offices at Northwest Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade
Center, Suite 1300, New York, New York 10048. You may obtain information on the
operation of the SEC's public reference facilities and how to request documents
by calling 1-800-SEC-0330. Information we file is also available at the SEC's
Internet site at http://www.sec.gov. You can also obtain these materials at set
rates from the Public Reference Section of the SEC at its principal office at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone to
provide you with different information. You should not assume that the
information in this prospectus or any prospectus supplement is accurate as of
any date other than the date on the front of those documents. This prospectus
does not constitute an offer to sell or a solicitation of an offer to buy the
Senior Notes in any jurisdiction to any person to whom it is unlawful to make
such offer or solicitation in such jurisdiction.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. Information incorporated by reference is
considered to be part of this prospectus. Later information that we file with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
until we sell all the Senior Notes.
- - Annual Report on Form 10-K for the year ended December 31, 1998;
- - Quarterly Reports on Form 10-Q for the quarters ended March 31,
June 30 and September 30, 1999, and
- - Current Reports on Form 8-K dated December 7, 1999, December 17, 1999,
January 25, 2000 and February 4, 2000.
We will provide to each person, including any beneficial owner of
Senior Notes, to whom a copy of this prospectus is delivered, a copy of any or
all of the information that has been incorporated by reference in this
prospectus but not delivered with this prospectus. We will deliver this
information upon written or oral request and provide this information at no cost
to the requester. You should direct your requests to:
Ms. Ellen Whalen
Manager of Investment Services
Central and South West Corporation
1616 Woodall Rodgers Freeway
Dallas, Texas 75202
(214) 777-1000
REPORTS TO HOLDERS OF SENIOR NOTES
We are not required to furnish annual and quarterly reports to holders
of Senior Notes. Our annual report on Form 10-K contains audited financial
statements which we will provide to holders of Senior Notes upon request.
FORWARD-LOOKING STATEMENTS
We make statements in this prospectus, any prospectus supplement and
the documents we incorporate by reference that are considered forward-looking
statements within the meaning of the Securities Act of 1933 and the Securities
Exchange Act of 1934. Sometimes these statements will contain words such as
"believes," "expects," "intends," "plans" and other similar words. These
statements are not guarantees of our future performance and are subject to
risks, uncertainties and other important factors that could cause our actual
performance or achievements to be materially different from those we project.
These risks, uncertainties and factors include:
- general economic, business and regulatory conditions;
- the impact of Central and South West Corporation's proposed
merger with American Electric Power, including any regulatory
conditions imposed on the merger;
- energy cost, supply and demand;
- federal and state regulatory initiatives that increase
competition;
- federal and state regulatory developments and changes in law;
- availability, terms and use of capital;
- environmental issues;
- weather; and
- industry restructuring and cost recovery.
Given these uncertainties, you should not place undue reliance on these
forward-looking statements. Please see the documents we incorporate by reference
for more information on these factors. These forward-looking statements
represent our estimates and assumptions only as of the date of this prospectus.
We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
PROSPECTUS SUMMARY
This summary does not contain all the information that may be important to
you. You should read the entire prospectus, the prospectus supplement, and the
documents, financial statements and other information incorporated by reference
in the prospectus carefully before making an investment decision.
The Offering
Issuer......................................Southwestern Electric Power Company
Securities Offered..........................Senior Notes
Aggregate Principal Amount..................Up to $250,000,000
Interest Payment Dates......................On dates to be determined
Maturity Date...............................To be determined
Redemption..................................To be determined
Ranking.....................................The Senior Notes are our senior
unsecured notes ranking equally
with any of our other unsecured
indebtedness that is not
specifically subordinated
to the Senior Notes. The Senior
Notes are subordinate to $362
million of our outstanding first
mortgage bonds which are secured
by a mortgage on substantially all
of our properties. The Senior
Notes rank junior to the
first mortgage bonds with respect
to rights in and to such mortgaged
property. We may in the future
issue additional series of first
mortgage bonds.
Use of Proceeds We will use the net
proceeds from the sale of the Senior
Notes to repay a portion of our
long-term debt, all or a portion of
our short-term borrowings, and for
other general corporate purposes.
The Company
Business....................................We are a public utility engaged in
the production, purchase,
transmission, distribution and sale
of electricity.
Service Area Our service area includes
approximately 25,000 square miles in
portions of northeastern Texas,
northwestern Louisiana and western
Arkansas.
Population of Service Area..................Approximately 942,000
Customers Approximately 422,000
SELECTED FINANCIAL INFORMATION
We have derived the summary selected financial data set forth below for the
years ended December 31, 1996, 1997, 1998 and 1999 from our financial
statements. Arthur Andersen LLP, independent public accountants, have audited
the financial statements for the three-year period ended December 31, 1998 and
the reports of Arthur Andersen LLP thereon are incorporated by reference in this
prospectus. The summary selected financial data as of and for the year ended
December 31, 1999, is unaudited.
You should read the information presented below in conjunction with the
historical financial statements and notes thereto contained in our 1998 Annual
Report on Form 10-K and our Quarterly Report on Form 10-Q for the period ended
September 30, 1999, which are incorporated by reference in this prospectus.
(Dollar amounts in thousands)
Year Ended December 31,
1999 1998 1997 1996
(Unaudited)
Operating Revenues $ 965,027 $952,952 $939,869 $920,786
Operating Income $ 147,524 $150,787 $139,409 $138,083
Net Income for Common
Stock $ 83,426 $96,542 $92,254 $63,503
Net Utility Plant $1,847,189 $1,840,854 $1,855,578 $1,851,958
Capitalization at
December 31, 1999
(Unaudited)
Actual %
Long-Term Debt $ 495,973 39
Company Obligated Mandatorily
Redeemable Preferred Securities
of Subsidiary Trust Holding Solely
Parent Junior Subordinated
Debentures.................. 110,000 9
Preferred Stock.............. 4,706 0
Common Equity............................. 668,678 52
Total.............................. $1,279,357 100
Short-........................ $140,898 -
Long-Term Debt and Preferred Stock
Currently Maturing... $ 45,595 -
SOUTHWESTERN ELECTRIC POWER COMPANY
We are a public utility company engaged in the production, purchase,
transmission, distribution and sale of electricity in portions of northeastern
Texas, northwestern Louisiana and western Arkansas. We serve approximately
422,000 customers in the northeastern Texas, northwestern Louisiana and western
Arkansas area. Central and South West Corporation, a registered public utility
holding company under the Public Utility Holding Company Act of 1935, owns all
of our issued and outstanding Common Stock. Our executive offices are located at
428 Travis Street, Shreveport, Louisiana 71156-0001, telephone number (318)
673-3000.
RATIOS OF EARNINGS TO FIXED CHARGES
Our ratios of earnings to fixed charges for each of the years ended
December 31, 1995 through 1999 are as follows:
Year Ended December 31,
1999 1998 1997 1996 1995
Ratio of Earnings to Fixed Charges(1) 2.97 3.53 3.46 2.81 3.80
(1) For purposes of computing the ratios: (i) earnings consist of operating
income plus federal income taxes, deferred income taxes and investment tax
credits, other income and deductions, allowance for funds (both borrowed and
equity) used during construction and interest portion of financing leases, and
(ii) fixed charges consist of interest on long-term debt and short-term debt,
and other interest charges and interest portion of financing leases.
USE OF PROCEEDS
We plan to use the net proceeds from the sale of the Senior Notes to
repay a portion of our long-term debt, all or a portion of our short-term
borrowings and for other general corporate purposes, subject to applicable
regulatory requirements. If we do not use the net proceeds immediately, we may
temporarily invest them in short-term, interest-bearing obligations.
DESCRIPTION OF THE SENIOR NOTES
General. We will issue Senior Notes under a Senior Note Indenture between us and
the Senior Note Trustee, The Bank of New York, a New York banking corporation.
We have summarized selected provisions of the Senior Note Indenture below. This
is a summary and is not complete. It does not describe all exceptions and
qualifications contained in the Senior Note Indenture. You should read the
Senior Note Indenture we filed as an exhibit to the registration statement. In
the summary below, we have included references to section numbers of the Senior
Note Indenture so that you can locate the summarized provisions. Capitalized
terms not defined in this prospectus have the meanings given to them in the
Senior Note Indenture.
There is no requirement under the Senior Note Indenture that future
issues of our debt securities be issued under the Senior Note Indenture. We will
be free to use other indentures or documentation, containing provisions
different from those included in the Senior Note Indenture or applicable to one
or more issues of Senior Notes, in connection with future issues of other debt
securities.
The Senior Note Indenture does not limit the aggregate principal amount
of the Senior Notes that we may issue under the Senior Note Indenture. The
Senior Note Indenture provides that the Senior Notes will be issued in one or
more series. The Senior Notes may be issued at various times and may have
differing maturity dates and may bear interest at differing rates. The
prospectus supplement applicable to each issue of Senior Notes will specify:
(1) the title of the Senior Notes;
(2) any limit on the aggregate principal amount of the Senior Notes;
(3) the person to whom any interest on the Senior Notes shall be
payable, if other than the person in whose name the Senior Notes are registered
at the close of business on the regular Record Date;
(4) the dates or dates on which the principal of the Senior Notes will
be payable or how the date or dates will be determined;
(5) the rate or rates at which the Senior Notes will bear interest, or
how the rate or rates will be determined and the date or dates from which
interest will accrue;
(6) the dates on which interest will be payable;
(7) the record dates for payments of interest;
(8) the place or places, if any, in addition to the office of the
Trustee, where the principal of, and premium, if any, and interest, if any, on
the Senior Notes will be payable;
(9) the period or periods within which the price or prices at which
and the terms and conditions upon which the Senior Notes may be repaid, in whole
or in part, at the option of the Holder thereof;
(10) any sinking fund or other provisions or options held by Holders of
the Senior Notes that would obligate us to repurchase or redeem the Senior
Notes;
(11) the percentage, if less than 100% of the principal amount of the
Senior Notes that will be payable if the maturity of the Senior Notes is
accelerated;
(12) any changes or additions to the events of default under the Senior
Note Indenture or changes or additions to our covenants under the Senior Note
Indenture;
(13) any collateral, security, assurance or guarantee for the Senior
Notes; and
(14) any other specific terms applicable to the Senior Notes.
Unless we otherwise indicate in the applicable prospectus supplement,
the Senior Notes will be denominated in United States currency in minimum
denominations of $1,000 and multiples of $1,000.
Unless we otherwise indicate in the applicable prospectus supplement,
there are no provisions in the Senior Note Indenture or the Senior Notes that
require us to redeem, or permit the Holders to cause a redemption of, the Senior
Notes or that otherwise protect the Holders in the event that we incur
substantial additional indebtedness, whether or not in connection with a change
in control of our company. However, any change in control transaction that
involves the incurrence of additional long-term indebtedness, as notes or
otherwise, by us in such a transaction may require approval of state utility
regulatory authorities and, possibly, of federal utility regulatory authorities.
Our management believes that such approvals would be uncertain in any
transaction that would result in us, or our successor, having a highly leveraged
capital structure.
Registration, Transfer, Exchange and Form. Senior Notes of any series will
be exchangeable for other Senior Notes of the same series of any authorized
denominations and of a like aggregate principal amount and tenor. (Section 305)
Unless we otherwise indicate in the applicable prospectus supplement,
Senior Notes may be presented for registration of transfer, duly endorsed or
accompanied by a duly executed written instrument of transfer, at the office or
agency maintained for such purpose, without service charge except for
reimbursement of taxes and other governmental charges as described in the Senior
Note Indenture. (Section 305)
In the event of any redemption of Senior Notes of any series, the
Senior Note Trustee will not be required to exchange or register a transfer of
any Senior Notes of the series selected, called or being called for redemption
except the unredeemed portion of any Senior Note being redeemed in part.
(Section 305)
Book-Entry Only System. The following discussion pertains to Senior Notes
that are issued in book-entry only form.
One or more global notes would be issued to DTC, The Depository Trust
Company, or its nominee. DTC would keep a computerized record of its
participants (for example, your broker) whose clients have purchased the Senior
Notes. The participant would then keep a record of its clients who purchased the
Senior Notes. A global note may not be transferred, except that DTC, its
nominees and their successors may transfer an entire global note to one another.
Under book-entry only, we will not issue certificates to individual
holders of the Senior Notes. Beneficial interests in global notes will be shown
on, and transfers of global notes will be made only through, records maintained
by DTC and its participants.
DTC has advised us that it is:
(1) a limited-purpose trust company organized under the New York
Banking Law;
(2) a "banking organization" within the meaning of the New York Banking Law;
(3) a member of the Federal Reserve System;
(4) a "clearing corporation" within the meaning of the New York Uniform
Commercial Code; and
(5) a "clearing agency" registered pursuant to the provisions of Section 17A of
the Securities Exchange Act of 1934.
DTC holds securities that its participants deposit with DTC. DTC also
facilitates the settlement among direct participants of securities transactions,
such as transfers and pledges, in deposited securities through computerized
records for direct participants' accounts. This eliminates the need to exchange
certificates. Direct participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other organizations.
DTC's book-entry system is also used by other organizations such as
securities brokers and dealers, banks and trust companies that work through a
direct participant. The rules that apply to DTC and its participants are on file
with the SEC.
DTC is owned by a number of its direct participants and by the New York
Stock Exchange, Inc., The American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc.
We will wire principal and interest payments to DTC's nominee. We and
the Senior Note Trustee will treat DTC's nominee as the owner of the global
notes for all purposes. Accordingly, we and the Senior Note Trustee will have no
direct responsibility or liability to pay amounts due on the Senior Notes to
owners of beneficial interests in the global notes.
It is DTC's current practice, upon receipt of any payment of principal
or interest, to credit direct participants' accounts on the payment date
according to their respective holdings of beneficial interests in the global
notes as shown on DTC's records as of the record date for such payment. In
addition, it is DTC's current practice to assign any consenting or voting rights
to direct participants whose accounts are credited with securities on a record
date, by using an omnibus proxy. Payments by participants to owners of
beneficial interests in the global notes, and voting by participants, will be
governed by the customary practices between the participants and owners of
beneficial interests, as is the case with securities held for the account of
customers registered in "street name." However, these payments will be the
responsibility of the participants and not of DTC, the Senior Note Trustee, or
us.
Senior Notes represented by a global note would be exchangeable for
Senior Note certificates with the same terms in authorized denominations only
if:
(1) DTC notifies us that it is unwilling or unable to continue as
depository or if DTC ceases to be a clearing agency registered under applicable
law; or
(2) we instruct the Senior Note Trustee that the global note is now
exchangeable; or
(3) an event of default has occurred and is continuing.
According to the DTC, the foregoing information with respect to DTC has
been provided to the financial community for informational purposes only and is
not intended to serve as a representation, warranty, or contract modification of
any kind.
Paying Agents. We will maintain an office or agency where Senior Notes
may be presented or surrendered for payment. We will give prompt written notice
to the Senior Note Trustee of the location, and any change in the location of
the office or agency. If at any time we fail to maintain any required office or
agency or fail to furnish the Senior Note Trustee with the address, any
presentations and surrenders may be made or served at the corporate trust office
of the Senior Note Trustee, and the Senior Note Trustee shall act as our agent
to receive all presentations and surrenders. (Section 1002)
All monies we pay to a paying agent for the payment of principal of,
interest or premium, if any, on any Senior Note which remain unclaimed at the
end of two years after the principal, interest or premium shall have become due
and payable will be repaid to us. The Holder of the Senior Note will thereafter
look only to us for payment.
(Section 1003)
Consolidation, Merger, Conveyance, Sale or Transfer. Unless otherwise
provided in a supplemental indenture and described in a prospectus supplement,
we may consolidate or merge with any Person or transfer our properties and
assets substantially as an entirety to any Person provided that:
(1) the successor is a Person organized and existing under the laws of the
United States or any State or the District of Columbia; and
(2) the successor expressly assumes by a supplemental indenture the due and
punctual payment of the principal of, and premium, if any, and interest, if any,
on all the Senior Notes and the performance of every covenant of the Senior Note
Indenture that we would otherwise have to perform. (Section 801)
Limitation on Liens. If this covenant is made applicable to the Senior
Notes of any particular series, we have agreed that we will not, nor will we
permit any of our subsidiaries to, issue, assume or guarantee any notes, bonds,
debentures or other similar evidences of indebtedness for borrowed money
(collectively referred to as "debt") secured by a mortgage, lien, pledge,
security interest or other encumbrance (a "lien") on or with respect to any of
our properties or assets or assets or properties of our subsidiaries unless we
make effective a provision under which the Senior Notes of that series are
secured equally and ratably with any and all borrowed money that we secure. This
restriction will not, however, apply to the following:
(1) liens in existence on the date of the original issue of the Senior
Notes to which this restriction is made applicable;
(2) liens created solely for the purpose of securing debt incurred to
finance, refinance or refund the purchase price or cost, including the cost of
construction, of property acquired after the date hereof, by purchase,
construction or otherwise, or liens in favor of guarantors of obligations or
debt representing, or incurred to finance, refinance or refund, such purchase
price or cost, provided that no such lien shall extend to or cover any property
other than the property so acquired and improvements thereon;
(3) liens which secure only indebtedness owing by any of our
subsidiaries, to one or more of our subsidiaries, or to us and one or more of
our subsidiaries;
(4) liens on any property or assets acquired from a Person which is
merged with or into us or any subsidiary, or any liens on the property or assets
of any corporation or other entity existing at the time such corporation or
other entity becomes a subsidiary and, in either case, is not created as a
result of or in connection with or in anticipation of any such transaction,
unless liens were created to secure or provide the payment of any part of the
purchase price of such corporation;
(5) any lien on any property or assets existing at the time of
acquisition thereof and which is not created as a result of or in connection
with or in anticipation of such acquisition, unless the lien was created to
secure or provide for the payment of any part of the purchase price of such
property or assets; or
(6) any extension, renewal or replacement of any lien referred to in
the foregoing clauses (1) through (5), provided that the principal amount of
debt so secured thereby shall not exceed the principal amount of debt so secured
at the time of such extension, renewal or replacement, and that such extension,
renewal or replacement lien shall be limited to all or part of substantially the
same property which secured the lien extended, renewed or replaced, plus
improvements on such property.
Notwithstanding the foregoing, we and one or more of our subsidiaries
may issue, assume or guarantee debt secured by liens which would otherwise be
subject to the foregoing restrictions in an aggregate principal amount which,
together with the aggregate outstanding principal amount of all of our other
debt which would otherwise be subject to the foregoing restrictions, not
including debt permitted to be secured under clauses (1) through (6) above, does
not at the time of issuance, assumption or guarantee thereof exceed twenty
percent of the Net Tangible Assets.
Net Tangible Assets is defined as the total of all assets, including
revaluations thereof as a result of commercial appraisals, price level
restatement or otherwise, appearing on our and our subsidiaries' balance sheet,
net of applicable reserves and deductions, but excluding goodwill, trade names,
trademarks, patents, unamortized debt discount and all other like intangible
assets, which term shall not be construed to include such revaluations, less the
aggregate of our and our subsidiaries' current liabilities appearing on such
balance sheet. The following types of transactions, among others, shall not be
deemed to create debt secured by liens: Liens required by any contract or
statute in order to permit us or our subsidiaries to perform any contract or
subcontract made by us with or at the request of a governmental entity or any
department, agency or instrumentality thereof, or to secure partial, progress,
advance or any other payments to us or any of our subsidiaries by such
governmental unit pursuant to the provisions of any contract or statute.
(Section 1007)
Modification of the Senior Note Indenture. Under the Senior Note
Indenture or any supplemental indenture, our rights and the rights of the
Holders of Senior Notes may be changed with the consent of the Holders of a
majority in principal amount of the outstanding Senior Notes, of all series
affected by the change, voting as one class, provided that the following changes
may not be made without the consent of the Holders of each outstanding Senior
Note affected thereby:
(1) change the fixed date upon which the principal of or the interest
on any Senior Note is due and payable, or reduce the principal amount thereof or
the rate of interest thereon or any premium payable upon the redemption thereof,
or reduce the amount of the principal of an Original Issue Discount Security
that would be payable upon a declaration of acceleration of the maturity
thereof, or change any place of payment where, or the currency in which, any
Senior Note or any premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any payment on or after the date
such payment is due or, in the case of redemption, on or after the date fixed
for such redemption (the "Redemption Date");
(2) reduce the stated percentage of Senior Notes, the consent of the
Holders of which is required for any modification of the applicable Senior Note
Indenture or for waiver by the Holders of certain of their rights; or
(3) modify certain provisions of the Senior Note Indenture. (Section
902)
An Original Issue Discount Security means any security authenticated
and delivered under the Senior Note Indenture which provides for an amount less
than the principal amount thereof to be due and payable upon the declaration of
acceleration of the maturity thereof.
The Senior Note Indenture also contains provisions permitting us and
the Senior Note Trustee to amend the Senior Note Indenture in certain
circumstances without the consent of the Holders of any Senior Notes to evidence
a merger, the replacement of the Senior Note Trustee and for certain other
purposes.
Events of Default. An Event of Default with respect to any series of
Senior Notes is defined in the Senior Note Indenture as being any one of the
following:
(1) failure to pay interest on the Senior Notes of that series for 30
days after payment is due;
(2) failure to pay principal or any premium on the Senior Notes of that
series when due;
(3) failure to perform other covenants in the Senior Note Indenture
after 90 days after we are given written notice
(4) failure to pay any sinking fund installment when due;
(5) certain events of bankruptcy, insolvency, reorganization,
receivership or liquidation relating to us. (Section 501)
An Event of Default regarding a particular series of Senior Notes does
not necessarily constitute an Event of Default for any other series of Senior
Notes.
We will be required to file with the Senior Note Trustee annually an
officers' certificate as to the absence of default in performance of certain
covenants in the Senior Note Indenture. (Section 1008) The Senior Note Indenture
provides that the Senior Note Trustee may withhold notice to the Holders of the
Senior Notes of any default, except in payment of principal of, or premium, if
any, or interest on, the Senior Notes or in the payment of any sinking fund
installment with respect to the Senior Notes, if the Senior Note Trustee in good
faith determines that it is in the interest of the Holders of the Senior Notes
to do so. (Section 602)
The Senior Note Indenture provides that, if an Event of Default with
respect to the Senior Notes specified therein shall have happened and be
continuing, either the Senior Note Trustee or the Holders of 33% or more in
aggregate principal amount of the Senior Notes may declare the principal amount
of all the Senior Notes to be due and payable immediately. However, if we shall
cure all defaults and certain other conditions are met, such declaration may be
annulled and past defaults may be waived by the Holders of a majority in
aggregate principal amount of the Senior Notes. (Section 502)
Subject to the provisions of the Senior Note Indenture relating to the
duties of the Senior Note Trustee, the Senior Note Trustee will be under no
obligation to exercise any of its rights or powers under the Senior Note
Indenture at the request or direction of any of the Holders of the Senior Notes,
unless the Holders shall have offered to the Senior Note Trustee reasonable
indemnity. (Section 603)
Subject to the provision for indemnification, the Holders of a majority
in principal amount of the Senior Notes will have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Senior Note Trustee, or exercising any trust or power conferred on the Senior
Note Trustee with respect to the Senior Notes. However, the Senior Note Trustee
shall have the right to decline to follow any direction if the Senior Note
Trustee shall determine that the action so directed conflicts with any law or
the provisions of the Senior Note Indenture or if the Senior Note Trustee shall
determine that the action would be prejudicial to Holders not taking part in the
direction. (Section 512)
Defeasance. We may elect either (a) to be discharged from all of our
obligations with respect to the Senior Notes, except for obligations to register
the transfer or exchange of Senior Notes, replace stolen, lost or mutilated
Senior Notes, to maintain paying agencies and to hold moneys for payment in
trust, or (b) to be discharged from our obligations under sections of the Senior
Note Indenture described under "--Consolidation, Merger, Conveyance, Sale or
Transfer" and "--Limitation of Liens" or to certain covenants relating to
corporate existence and maintenance of properties and insurance, in each case,
if:
(1) we deposit with the Senior Note Trustee, in trust, money, or in
certain cases, U.S. Government Obligations sufficient to pay and discharge (i)
the principal of, and premium, if any, and interest, if any, on the outstanding
Senior Notes on the dates such payments are due, in accordance with the terms of
the Senior Notes and (ii) any mandatory sinking fund payments applicable to the
Senior Notes on the day on which payments are due and payable in accordance with
the terms of the Senior Note Indenture and of the Senior Notes;
(2) no Event of Default or event which with notice or lapse of time
would become an Event of Default, including by reason of such deposit, with
respect to the Senior Notes shall have occurred and be continuing on the date of
such deposit;
(3) we deliver to the Senior Note Trustee an opinion of counsel to the
effect (i) that the Holders will not recognize income, gain or loss for Federal
income tax purposes as a result of such deposit and defeasance of certain
obligations; (ii) that such provision would not cause any outstanding Senior
Notes then listed on any national securities exchange to be delisted as a result
thereof; and (iii) that the defeasance trust is not, or is registered as, an
investment company under the Investment Company Act of 1940; and
(4) we have delivered to the Senior Note Trustee an officers'
certificate and an opinion of counsel, each stating that all conditions
precedent provided for in the Senior Note Indenture relating to the satisfaction
and discharge of the Senior Notes have been complied with. (Sections 403, 1011)
Discharged means, with respect to the Senior Notes of any series, the
discharge of the entire indebtedness represented by, and our obligations under,
the Senior Notes of such series and in the satisfaction of all of our
obligations under, the Senior Note Indenture relating to the Senior Notes of
such series, except (a) the rights of Holders of the Senior Notes of such series
to receive, from the trust fund established pursuant to the Senior Note
Indenture, payment of the principal of and interest and premium, if any, on the
Senior Notes of such series when such payments are due, (b) our obligations with
respect to the Senior Notes of such series with respect to registration,
transfer, exchange and maintenance of a place of payment and (c) the rights,
powers, trusts, duties, protections and immunities of the Senior Note Trustee
under the Senior Note Indenture. (Section 101)
If we have deposited or caused to be deposited money or U.S. Government
Obligations to pay or discharge the principal of, and premium, if any, and
interest, if any, on the outstanding Senior Notes to and including a Redemption
Date on which all of the outstanding Senior Notes are to be redeemed, such
Redemption Date shall be irrevocably designated by a Board of Directors
resolution delivered to the Senior Note Trustee on or prior to the date of
deposit of such money or U.S. Government Obligations, and such Board of
Directors resolution shall be accompanied by an irrevocable Company Request that
the Senior Note Trustee give notice of such redemption in our name and at our
expense not less than 30 nor more than 60 days prior to such Redemption Date in
accordance with the Senior Note Indenture. (Sections 403)
U.S. Government Obligations means direct obligations of the United
States for the payment of which its full faith and credit is pledged, or
obligations of a person controlled or supervised by and acting as an agency or
instrumentality of the United States and the payment of which is unconditionally
guaranteed by the United States. U.S. Government Obligations shall also include
a depositary receipt issued by a bank or trust company as custodian with respect
to any such U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for the
account of a holder of a depositary receipt. However, except as required by law,
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Government Obligation evidenced by such
depositary receipt. (Section 101)
Resignation or Removal of Senior Note Trustee. The Senior Note Trustee
may resign at any time by giving written notice to us specifying the day upon
which the resignation is to take effect. The resignation will take effect
immediately upon the later of the appointment of a successor Senior Note Trustee
and such specified day.
(Section 610)
The Senior Note Trustee may be removed at any time by an instrument or
concurrent instruments in writing delivered to the Senior Note Trustee and us
and signed by the Holders, or their attorneys-in-fact, of at least a majority in
principal amount of the then outstanding Senior Notes. In addition, under
certain circumstances, we may remove the Senior Note Trustee upon notice to the
Holder of each Senior Note outstanding and the Senior Note Trustee, and
appointment of a successor Senior Note Trustee. (Section 610)
No Recourse Against Others. The Senior Note Indenture provides that no
recourse will be had against any of our incorporators, stockholders, officers or
directors, as such, past, present or future or any successor Person, either
directly or through us or any successor Person, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise in the case of the following:
(1) the payment of the principal of or any premium or interest on any Senior
Note, or for any claim based thereon or otherwise in respect thereof;
(2) under or upon any obligation, covenant or agreement of ours, contained in
the Senior Note Indenture or in any supplemental indenture, or in any Senior
Note; or
(3) because of the creation of any indebtedness represented thereby.
It shall be expressly understood that all such liability is expressly
waived and released as a condition of, and in consideration for, the execution
of the Senior Note Indenture and the issuance of the Senior Notes. (Section 114)
Such waiver may not be effective to waive liabilities under the Federal
securities laws and it is the view of the SEC that such a waiver is against
public policy.
Concerning the Senior Note Trustee. The Trustee under the Senior Note
Indenture, and affiliates of the Trustee, are also trustees under other
indentures and trust agreements of ours.
LEGAL OPINIONS
Legal opinions relating to the validity of the Senior Notes will be
given by Milbank, Tweed, Hadley & McCloy LLP, 1 Chase Manhattan Plaza, New York,
New York 10005, our counsel, and Sidley & Austin, One First National Plaza,
Chicago, Illinois 60603, counsel for any underwriters, agents or dealers. Sidley
& Austin and Milbank, Tweed, Hadley & McCloy LLP have represented CSW and
affiliates of CSW, including us, from time to time in connection with certain
legal matters.
EXPERTS
The audited financial statements and schedules incorporated by
reference in this prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report dated February 12, 1999, with respect thereto, and are
incorporated herein by reference in reliance upon the authority of said firm as
experts in accounting and auditing in giving said reports.
PLAN OF DISTRIBUTION
We may use the following methods to sell the Senior Notes:
(1) through negotiation with one or more underwriters;
(2) through one or more agents or dealers designated from time to time;
(3) directly to purchasers; or
(4) through any combination of the above.
The distribution of the Senior Notes may be effected from time to time in one or
more transactions at a fixed price or prices which may be changed, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. A prospectus supplement or a supplement
thereto will describe the method of distribution of the Senior Notes of any
series.
If we use any underwriters in the sale of Senior Notes, we will enter
into an underwriting agreement, distribution agreement or similar agreement with
such underwriters prior to the time of sale, and the names of the underwriters
used in the transaction will be set forth in the prospectus supplement or a
supplement thereto relating to such sale. If an underwriting agreement is
executed, the Senior Notes will be acquired by the underwriters for their own
account and may be resold from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of the sale. Unless we otherwise indicate
in the prospectus supplement, the underwriting or purchase agreement will
provide that the underwriter or underwriters are obligated to purchase all of
the Senior Notes offered in the prospectus supplement if any are purchased.
If any of the Senior Notes are sold through agents designated by us
from time to time, the prospectus supplement or a supplement thereto will name
any such agent, set forth any commissions payable by us to any such agent and
the obligations of such agent with respect to the Senior Notes. Unless otherwise
indicated in the prospectus supplement or a supplement thereto, any such agent
will be acting on a best efforts basis for the period of its appointment.
Certain persons participating in an offering of the Senior Notes may
engage in transactions that stabilize, maintain or otherwise affect the price of
the Senior Notes. Specifically, the underwriters, if any, may overallot in
connection with the offering, and may bid for, and purchase, the Senior Notes in
the open market.
The Senior Notes of any series, when first issued, will have no
established trading market. Any underwriters or agents to or through whom Senior
Notes are sold by us for public offering and sale may make a market in such
Senior Notes, but underwriters and agents will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for any Senior Notes.
In connection with the sale of the Senior Notes, any purchasers,
underwriters or agents may receive compensation from us or from purchasers in
the form of concessions or commissions. The underwriters will be, and any agents
and any dealers participating in the distribution of the Senior Notes may be,
deemed to be underwriters within the meaning of the Securities Act of 1933. The
agreement between us and any purchasers, underwriters or agents will contain
reciprocal covenants of indemnity, and will provide for contribution by us in
respect of our indemnity obligations, between us and the purchasers,
underwriters, or agents against certain liabilities, including liabilities under
the Securities Act of 1933.
Underwriters, dealers and agents may engage in transactions with, or
perform services for, us and our affiliates in the ordinary course of business.
II-4
II-1
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the issuance and distribution
of the securities being registered, other than underwriting compensation, are:
Filing fee for registration statement............ $66,000*
Printing costs.............................. 10,000
Fees and expenses of Senior Note Trustee........ 10,000
Fees of rating agencies......................... 45,000
Fees of accountants.............................. 15,000
Reimbursement of underwriters' expenses and counsel
fees in connection with qualification or registration
of the Senior Notes under state securities or "blue
sky" laws 5,000
Expenses of Central and South West Services, Inc.... 5,000
Counsel Fees......................................... 100,000
Miscellaneous and incidental expenses, including
travel, telephone, copying, postage 5,000
Total................................................... $261,000
*Actual Amount
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law provides broadly
for indemnification of directors and officers against claims and liabilities
against them in their capacities as such. The Company's bylaws also provide for
the indemnification of officers and directors by the Company. In addition, the
Company has purchased Directors' and Officers' Liability and Company
Reimbursement Liability Insurance which, in certain circumstances, provide for
payments to the directors and officers of the Company, in the event of such
liabilities.
Item 16. Exhibits
INDEX TO EXHIBITS
Exhibit No. Exhibit
1 Form of Underwriting Agreement for the Senior Notes.
3(a) Restated Articles of Incorporation (incorporated Incorporated
herein by reference to Incorporated Exhibit 3.4 by reference
to the Company's Form 10-Q for the Quarter
ended March 31, by reference 1997).
3(b) By-Laws (incorporated herein by reference to Incorporated
Exhibit 3.3 to the Company's Form 10-Q for by reference
the Quarter ended September 30, 1996).
4 Form of Senior Note Indenture.
5 Opinion of Milbank, Tweed, Hadley & McCloy LLP,
counsel for the Company, as to the legality of
the Senior Notes.
12(a) Statement re: computation of Ratio of Earnings
to Fixed Charges for the five years ended
December 31, 1998 (incorporated herein by
reference to Exhibit 12 to the Company's
1998 Annual Report on Form 10-K).
12(b) Statement re: computation of Ratio of Earnings to Fixed
Charges for the Incorporated twelve months ended September
30, 1999 (incorporated herein by reference by reference to
Exhibit 12.13 to the Company's Form 10-Q for the Quarter
ended September 30, 1999).
12(c) Statement re: computation of Ratio of Earnings to Fixed Charges
for the twelve months ended December 31, 1999
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of Milbank, Tweed, Hadley & McCloy LLP (contained in Exhibit 5
above).
24 Power of Attorney (included on signature page of the registration
statement).
25 Form T-1 Statement of Eligibility under the Trust
Indenture Act of 1939 of Bank of New York, as Senior Note
Trustee, under the Senior Note Indenture.
27 Financial Data Schedule.
Item 17. 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 this 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 20 percent 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 this registration statement;
provided, however, that the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by these paragraphs is contained in periodic reports
filed by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in this
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 this registration
statement shall be deemed to be a new registration statement relating
to the securities offered herein, 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
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 Shreveport, State of Louisiana, on February 4, 2000.
SOUTHWESTERN ELECTRIC POWER COMPANY
By:/s/ Wendy G. Hargus
Wendy G. Hargus
Treasurer
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes and
appoints Wendy G. Hargus and Stephen D. Wise or either of them, as his or her
attorney-in-fact, with full power of substitution and resubstitution to sign and
file on his or her behalf individually and in each such capacity stated below
any and all amendments and post-effective amendments to this registration
statement, including any amendment filed after the date hereof pursuant to Rule
462(b) under the Securities Act of 1933, as amended, as fully as such person
could do in person, hereby verifying and confirming all that said
attorney-in-fact, or either of them, or their or his substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on February 4, 2000.
Signature Title
/s/ Michael H. Madison President (principal executive officer); Director
Michael H. Madison
/s/ R. Russell Davis Controller (principal accounting and
financial officer)
R. Russell Davis
/s/ Karen C. Adams General Manager; Director
Karen C. Adams
/s/ E.R. Brooks Director
E.R. Brooks
/s/ James E. Davison Director
James E. Davison
/s/ Glenn Files Director
Glenn Files
/s/ Dr. Frederick E. Joyce Director
Dr. Frederick E. Joyce
/s/ John M. Lewis Director
John M. Lewis
/s/ William C. Peatross Director
William C. Peatross
/s/ Maxine P. Sarpy Director
Maxine P. Sarpy
INDEX TO EXHIBITS
Exhibit No. Exhibit
1 Form of Underwriting Agreement for the Senior Notes. Incorporated
3(a) Restated Articles of Incorporation (incorporated herein by reference
by reference to Exhibit 3.4 to the Company's Form 10-Q
the Quarter ended March 31, 1997)
3(b) By-laws (incorporated herein by reference to Exhibit 3.1 Incorporated
to the Company's form 10-Q for the Quarter ended by reference
September 30, 1996.)
4 Form of Senior Note Indenture
5 Opinion of Milbank, Tweed, Hadley & McCloy LLP, counsel for
the Company, as to the legality of the Senior Notes.
12(b) Statement re: computation of Ratio of Earnings to Incorporated
Fixed Charges for the Incorporated twelve months ended by reference
September 30, 1999 (incorporated herein by reference
by reference to Exhibit 12.13 to the Company's
Form 10-Q for the Quarter
ended September 30, 1999).
12(c) Statement re: computation of Ratio of Earnings to Fixed Charges for
the twelve months ended December 31, 1999
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of Milbank, Tweed, Hadley & McCloy LLP (contained in Exhibit
5 above).
24 Power of Attorney (included on signature page of the registration
statement).
25 Form T-1 Statement of Eligibility under the Trust Indenture Act
of 1939
of Bank of New York, as Senior Note Trustee, under the Senior Note
Indenture.
27 Financial Data Schedule.