PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED NOVEMBER 15, 1993)
$115,000,000
LOUISIANA POWER & LIGHT COMPANY
FIRST MORTGAGE BONDS, 8 3/4% SERIES DUE MARCH 1, 2026
---------------------------
Interest on the Company's First Mortgage Bonds, 8 3/4% Series due March
1, 2026 (the 'New Bonds') is payable on March 1 and September 1 of each year,
commencing September 1, 1996. The New Bonds will not be redeemable prior to
March 1, 2001. Thereafter, the New Bonds will be redeemable at the option of
the Company, in whole or in part, at any time, upon not less than 30 days'
notice, at the general redemption prices as described herein and, under
certain circumstances, at the special redemption price of 100% of the
principal amount thereof plus accrued interest to the date fixed for
redemption. See 'Description of the New Bonds -- Redemption and Purchase of
New Bonds' herein.
---------------------------
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 SUPPLEMENT
OR THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- ----------------------------------------------------------------------------------------------------------------
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UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(3)
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Per New Bond......................... 100.00% 0.875% 99.125%
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Total................................ $115,000,000 $1,006,250 $113,993,750
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(1) Plus accrued interest, if any, from March 27, 1996.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
(3) Before deduction of expenses payable by the Company, estimated at
$135,000.
---------------------------
The New Bonds are offered subject to prior sale, when, as and if
delivered to and accepted by the Underwriters and subject to certain other
conditions. The Underwriters reserve the right to withdraw, cancel or modify
such offer and to reject orders in whole or in part. It is expected that the
New Bonds will be ready for delivery through the book-entry facilities of The
Depository Trust Company, New York, New York, on or about March 27, 1996,
against payment therefor in immediately available funds.
---------------------------
BEAR, STEARNS & CO. INC.
GOLDMAN, SACHS & CO.
SALOMON BROTHERS INC
---------------------------
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS MARCH 20, 1996.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Reference is made to 'Incorporation of Certain Documents by Reference' in
the accompanying Prospectus. At the date of this Prospectus Supplement, the
Incorporated Documents (as defined in the accompanying Prospectus) include the
Company's Annual Report on Form 10-K for the year ended December 31, 1995.
SELECTED FINANCIAL INFORMATION
(DOLLARS IN THOUSANDS)
The selected financial information of the Company set forth below should
be read in conjunction with the financial statements and other financial
information contained in the Incorporated Documents.
FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------------------------------------
1995 1994 1993 1992 1991
------------- ------------- ------------- ------------- -------------
Income Statement Data:
Operating Revenues.............. $ 1,674,875 $ 1,710,415 $ 1,731,541 $ 1,553,745 $ 1,528,934
Operating Income................ 332,269 343,120 321,612 318,280 332,496
Interest Expense (net).......... 134,885 133,977 135,209 140,628 167,291
Net Income...................... 201,537 213,839 188,808 182,989 166,572
Ratio of Earnings to Fixed
Charges(1)................... 3.18 2.91 3.06 2.79 2.40
AS OF DECEMBER 31,
1995(2)
-------------------------
AMOUNT PERCENT
------------- -------
Balance Sheet Data:
Capitalization:
Common Stock and Paid-in
Capital................. $ 1,084,064 38.7
Retained Earnings......... 72,150 2.6
------------- -------
Total Common
Shareholder's
Equity............ 1,156,214 41.3
Preferred Stock (without
sinking fund)........... 160,500 5.7
Preferred Stock (with
sinking fund)........... 100,009 3.6
First Mortgage Bonds(3)... 610,790 21.8
Other Long-Term Debt(3)... 774,381 27.6
------------- -------
Total
Capitalization... $ 2,801,894 100.0
------------- -------
------------- -------
(1) 'Earnings', as defined by Securities and Exchange Commission ('SEC')
Regulation S-K, represent the aggregate of (a) net income, (b) taxes based
on income, (c) investment tax credit adjustments -- net and (d) fixed
charges. 'Fixed Charges' include interest (whether expensed or
capitalized), related amortization and interest applicable to rentals
charged to operating expenses.
(2) The proceeds from the sale of the New Bonds are expected to be used
primarily to refund outstanding First Mortgage Bonds and as a result the
Company's capitalization will not be materially affected. See 'Use of
Proceeds'.
(3) Excludes current maturities of First Mortgage Bonds and Other Long-Term
Debt of $35 million and $260,400, respectively.
USE OF PROCEEDS
Approximately $95 million of the net proceeds to be received from the
issuance and sale of the New Bonds are expected to be used to satisfy a
portion of the Company's annual replacement fund requirement under the
Mortgage and the remainder will be used for general corporate purposes. The
Company expects to use the cash deposited to satisfy the annual replacement
fund requirement to redeem all of the Company's First Mortgage Bonds, 10 1/8%
Series due April 1, 2020 (at a price equal to 100% of the principal amount
thereof, plus accrued interest to the date of redemption).
DESCRIPTION OF THE NEW BONDS
The following description of the particular terms of the New Bonds
offered hereby supplements, and to the extent inconsistent therewith replaces,
the description of the general terms and provisions of the New Bonds set forth
in the accompanying Prospectus under the heading 'Description of New Bonds',
to which description reference is hereby made. As used in this Prospectus
Supplement, the terms 'Bonds', 'Corporate Trustee', 'Mortgage', 'Participants'
and 'DTC' shall have the same meanings as the same terms used under the
headings 'Description of New Bonds' and 'Book Entry Securities' in the
accompanying Prospectus.
INTEREST, MATURITY AND PAYMENT. The New Bonds will mature on March 1,
2026. The New Bonds will bear interest from March 27, 1996 at the rate shown
in their title, payable on March 1 and September 1 of each year, commencing
September 1, 1996. Interest is payable to holders of record on the interest
payment date. Principal and interest are payable at the office or agency of
the Company in New York City. For so long as the New Bonds are registered in
the name of DTC, or its nominee, the principal and interest due on the New
Bonds will be payable by the Company or its agent to DTC for payment to its
Participants for subsequent disbursement to the beneficial owners. The Company
has covenanted to pay interest on any overdue principal and (to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest on the Bonds of all series at the rate of 6%
per annum.
REDEMPTION AND PURCHASE OF NEW BONDS. The New Bonds will not be
redeemable for any purpose prior to March 1, 2001. Thereafter, the New Bonds
will be redeemable at the option of the Company, in whole or in part, at any
time, upon not less than 30 days' notice (a) at the special redemption price
set forth below with cash deposited under the replacement fund or with certain
deposited cash or proceeds of released property, and (b) at the general
redemption prices set forth below for all other redemptions:
GENERAL SPECIAL GENERAL SPECIAL
REDEMPTION REDEMPTION REDEMPTION REDEMPTION
YEAR PRICE(%) PRICE(%) YEAR PRICE(%) PRICE(%)
- ------------------------------------- ---------- ---------- ----------------------------- ---------- ----------
If redeemed during the 12-month period ending the last day of February,
2002................................. 106.563 100.000
2003................................. 106.125 100.000
2004................................. 105.688 100.000
2005................................. 105.250 100.000
2006................................. 104.813 100.000
2007................................. 104.375 100.000
2008................................. 103.938 100.000
2009................................. 103.500 100.000
2010................................. 103.063 100.000
2011................................. 102.625 100.000
2012................................. 102.188 100.000
2013................................. 101.750 100.000
2014................................. 101.313 100.000
2015................................. 100.875 100.000
2016................................. 100.438 100.000
2017................................. 100.000 100.000
2018................................. 100.000 100.000
2019................................. 100.000 100.000
2020................................. 100.000 100.000
2021................................. 100,000 100.000
2022................................. 100.000 100.000
2023................................. 100.000 100.000
2024................................. 100.000 100.000
2025................................. 100.000 100.000
2026................................. 100.000 100.000
in each case together with accrued interest to the date fixed for redemption.
If, at the time notice of redemption is given, the redemption monies are
not held by the Corporate Trustee, the redemption may be made subject to
receipt of such monies before the date fixed for redemption, and such notice
shall be of no effect unless such monies are so received.
Cash deposited under any provision of the Mortgage (with certain
exceptions) may be applied to the redemption or purchase (including purchase
from the Company) of Bonds of any series.
DIVIDEND COVENANT. The Company will covenant in substance that, so long
as any New Bonds remain outstanding, it will not pay any cash dividends on
common stock after February 29, 1996 (other than certain dividends declared by
the Company on or before February 29, 1996) except from credits to retained
earnings after February 29, 1996 plus $345,000,000 and plus such additional
amounts as shall be approved by the SEC.
SINKING OR IMPROVEMENT FUND. The New Bonds will not be entitled to any
sinking or improvement fund.
RESERVATION OF RIGHTS TO AMEND THE MORTGAGE.
REPLACEMENT FUND. The Company has reserved the right without any
consent or other action by the holders of the New Bonds or any
subsequently created series to amend the Mortgage to eliminate the
requirements of the Replacement Fund.
ISSUANCE OF ADDITIONAL BONDS. The Company has reserved the right
without any consent or other action by the holders of the New Bonds or
any subsequently created series to amend the Mortgage (1) to provide that
Bonds may be issued upon the basis of 80% of the cost or fair value
(whichever is less) of unfunded property additions after adjustments to
offset retirements (in addition to the other bases of issuance) and (2)
to modify the net earnings test (a) to provide that the period over which
net earnings is computed shall be 12 consecutive months out of the
immediately preceding 18 months (instead of the immediately preceding 15
months), (b) to specifically permit the inclusion in net earnings of
revenues collected subject to possible refund and allowances for funds
used during construction and (c) to provide for no deduction for non-
recurring charges.
RELEASE AND SUBSTITUTION OF PROPERTY. The Company has reserved the
right without any consent or other action by the holders of the New Bonds
or any subsequently created series to amend the Mortgage (1) to permit
the release of mortgaged property from the lien of the Mortgage in an
amount equal to the aggregate principal amount of retired bonds that the
Company elects to use as the basis for such release times the reciprocal
of the bonding ratio in effect at the time such retired bonds were
originally issued; (2) to permit the release of unfunded property so long
as the Company has at least $1 in unfunded property additions remaining;
(3) to remove the existing limitations on the amount of obligations
secured by purchase money mortgages upon any property being released that
can be used as the basis for such release; (4) to specifically provide
that if the Company transfers as an entirety all or substantially all
property subject to the Mortgage to a successor corporation, the Company
would be released of all obligations under the Mortgage; and (5) to
change the definition of 'Funded Property' to mean only property
specified by the Company with a fair value, to be determined by an
independent expert, of not less than 10/8 of the sum of the amount of
outstanding Bonds and retired bond credits.
MODIFICATION. The Company has reserved the right without any
consent or other action by the holders of the New Bonds or any
subsequently created series to amend the Mortgage (1) to reduce the
percentage vote required to modify certain bondholders' rights from 70%
or 66 2/3%, as the case may be, to a majority of Bonds outstanding; (2)
to provide that, if less than all series of Bonds outstanding are to be
affected by a proposed change in the Mortgage, that only the consent of a
majority of the Bonds of each affected series is required to make such
change; and (3) to permit the Company to amend the Mortgage without the
consent of the holders of Bonds to make changes which do not adversely
affect the interests of such bondholders in any material respect.
UNDERWRITING
Under the terms and conditions set forth in the Underwriting Agreement
dated the date hereof, the Company has agreed to sell to each of the
Underwriters named below, and each of the Underwriters has severally agreed to
purchase, the respective principal amount of the New Bonds set forth opposite
its name below:
UNDERWRITER PRINCIPAL AMOUNT
- ------------------------------------- ----------------
Bear, Stearns & Co. Inc.............. $ 58,000,000
Goldman, Sachs & Co.................. $ 40,000,000
Salomon Brothers Inc................. $ 17,000,000
----------------
Total....................... $115,000,000
----------------
----------------
The Underwriting Agreement provides that the several obligations of the
Underwriters to pay for and accept delivery of the New Bonds are subject to
approval of certain legal matters by their counsel and to certain other
conditions. The Underwriters' obligations are such that they are committed to
take and pay for all of the New Bonds offered hereby if any are taken,
provided, that under certain circumstances involving a default of an
Underwriter, less than all of the New Bonds may be purchased. Default by one
Underwriter would not relieve the non-defaulting Underwriters from their
several obligations, and in the event of such a default, the non-defaulting
Underwriters may be required by the Company to purchase the principal amount
of the New Bonds that they have severally agreed to purchase and, in addition,
to purchase the principal amount of the New Bonds that the defaulting
Underwriter, or Underwriters, shall have failed to purchase, severally and not
jointly, up to a principal amount equal to one-ninth of the principal amount
of the New Bonds that such non-defaulting Underwriters have otherwise agreed
to purchase.
The Underwriters have advised the Company that they propose to offer all
or part of the New Bonds directly to purchasers at the initial public offering
price set forth on the cover page of this Prospectus Supplement, and to
certain securities dealers at such price less a concession not in excess of
0.50% of the principal amount of the New Bonds. The Underwriters may allow,
and such dealers may reallow to certain brokers and dealers, a concession not
in excess of 0.25% of the principal amount of the New Bonds. After the New
Bonds are released for sale to the public, the offering price and other
selling terms may from time to time be varied.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
There is presently no trading market for the New Bonds and there is no
assurance that a market will develop. Although they are under no obligation to
do so, the Underwriters presently intend to act as market makers for the New
Bonds in the secondary trading market, but may discontinue such market-making
at any time without notice.
EXPERTS AND LEGALITY
The Company's balance sheets as of December 31, 1995 and 1994 and the
statements of income, retained earnings, and cash flows and the related
financial statement schedule for each of the two years ended December 31,
1995, incorporated by reference in this Prospectus, have been incorporated by
reference herein in reliance on the reports of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
The statements of income, retained earnings, and cash flows and the
related financial statement schedule for the year ended December 31, 1993,
incorporated in this Prospectus by reference to the Company's Annual Report on
Form 10-K for the year ended December 31, 1995, have been audited by Deloitte
& Touche LLP, independent auditors, as stated in their reports dated February
11, 1994, also incorporated by reference herein and have been so included in
reliance upon the reports of such firm given upon their authority as experts
in accounting and auditing.
The legality of the New Bonds will be passed upon for the Company by
Denise C. Redmann, Senior Attorney -- Corporate and Securities of Entergy
Services, Inc. and Reid & Priest LLP, New York, New York. Certain legal
matters will be passed upon for the Underwriters by Winthrop, Stimson, Putnam
& Roberts, New York, New York. Matters pertaining to New York law will be
passed upon by Reid & Priest LLP, New York counsel to the Company, and matters
pertaining to Louisiana law will be passed upon by Denise C. Redmann, Senior
Attorney -- Corporate and Securities of Entergy Services, Inc., Louisiana
counsel to the Company.
The statements as to matters of law and legal conclusions made under
'Description of the New Bonds' in this Prospectus Supplement and 'Description
of New Bonds' in the accompanying Prospectus have been reviewed by Denise C.
Redmann, Senior Attorney -- Corporate and Securities of Entergy Services, Inc.
and, except as to 'Security' therein, by Reid & Priest LLP, New York, New
York, and are set forth herein in reliance upon the opinions of said counsel,
respectively, and upon their authority as experts.
PROSPECTUS
$369,000,000
LOUISIANA POWER & LIGHT COMPANY
FIRST MORTGAGE BONDS
PREFERRED STOCK, CUMULATIVE, $25 PAR VALUE
PREFERRED STOCK, CUMULATIVE, $100 PAR VALUE
LOUISIANA POWER & LIGHT COMPANY (THE 'COMPANY') MAY OFFER FROM TIME TO TIME
ITS FIRST MORTGAGE BONDS (THE 'NEW BONDS') AND/OR ITS PREFERRED STOCK,
CUMULATIVE, $25 PAR VALUE AND/OR PREFERRED STOCK, CUMULATIVE, $100 PAR VALUE
(COLLECTIVELY, THE 'NEW PREFERRED STOCK'), PROVIDED, HOWEVER, THAT THE
AGGREGATE PRINCIPAL AMOUNT AND/OR PAR VALUE, AS THE CASE MAY BE, SHALL NOT
EXCEED $369 MILLION. THE NEW BONDS AND NEW PREFERRED STOCK WILL EACH BE
OFFERED IN ONE OR MORE SERIES AT PRICES AND ON TERMS TO BE DETERMINED AT THE
TIME OF SALE. THIS PROSPECTUS WILL BE SUPPLEMENTED BY A PROSPECTUS SUPPLEMENT
OR SUPPLEMENTS (THE 'PROSPECTUS SUPPLEMENT') WHICH WILL SET FORTH, AS
APPLICABLE, (1) THE AGGREGATE PRINCIPAL AMOUNT, RATE AND TIME OF PAYMENT OF
INTEREST, MATURITY, PURCHASE PRICE, INITIAL PUBLIC OFFERING PRICE, IF ANY, ANY
REDEMPTION PROVISIONS AND OTHER SPECIFIC TERMS OF THE SERIES OF THE NEW BONDS
IN RESPECT OF WHICH THIS PROSPECTUS IS BEING DELIVERED AND/OR (2) THE NUMBER
OF SHARES, THE PAR VALUE PER SHARE, PURCHASE PRICE, INITIAL PUBLIC OFFERING
PRICE, IF ANY, DIVIDEND RATE, ANY REDEMPTION OR SINKING FUND TERMS AND OTHER
SPECIFIC TERMS OF THE SERIES OF THE NEW PREFERRED STOCK IN RESPECT OF WHICH
THIS PROSPECTUS IS BEING DELIVERED. THE SALE OF ONE SERIES OF ANY SECURITY
WILL NOT BE CONTINGENT UPON THE SALE OF ANY OTHER SERIES OF ANY SECURITY.
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 REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE COMPANY MAY SELL ONE OR MORE SERIES OF THE NEW BONDS AND/OR THE NEW
PREFERRED STOCK THROUGH UNDERWRITERS, DEALERS OR AGENTS, OR DIRECTLY TO ONE OR
MORE PURCHASERS. THE PROSPECTUS SUPPLEMENT WILL SET FORTH THE NAMES OF
UNDERWRITERS, DEALERS OR AGENTS, IF ANY, ANY APPLICABLE COMMISSIONS OR
DISCOUNTS AND THE NET PROCEEDS TO THE COMPANY FROM ANY SUCH SALE. SEE 'PLAN OF
DISTRIBUTION' FOR POSSIBLE INDEMNIFICATION ARRANGEMENTS FOR UNDERWRITERS,
DEALERS, AGENTS AND PURCHASERS.
THE DATE OF THIS PROSPECTUS IS NOVEMBER 15, 1993.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY OR ANY OTHER SECURITIES OF THE COMPANY AT LEVELS ABOVE THOSE
WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE
EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR
OTHERWISE. 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 ('EXCHANGE ACT') AND IN ACCORDANCE
THEREWITH FILES REPORTS AND OTHER INFORMATION WITH THE SECURITIES AND EXCHANGE
COMMISSION ('SEC'). SUCH REPORTS INCLUDE INFORMATION, AS OF PARTICULAR DATES,
CONCERNING THE COMPANY'S DIRECTORS AND OFFICERS, THEIR REMUNERATION, THE
PRINCIPAL HOLDERS OF THE COMPANY'S SECURITIES AND ANY MATERIAL INTEREST OF
SUCH PERSONS IN TRANSACTIONS WITH THE COMPANY. SUCH REPORTS AND OTHER
INFORMATION CAN BE INSPECTED AND COPIED AT THE PUBLIC REFERENCE FACILITIES
MAINTAINED BY THE SEC AT 450 FIFTH STREET, N.W., ROOM 1024, WASHINGTON, D.C.
20549; 500 WEST MADISON STREET, 14TH FLOOR, CHICAGO, ILLINOIS 60661; AND SEVEN
WORLD TRADE CENTER, 13TH FLOOR, NEW YORK, NEW YORK 10048. COPIES OF THIS
MATERIAL CAN ALSO BE OBTAINED AT PRESCRIBED RATES FROM THE PUBLIC REFERENCE
SECTION OF THE SEC AT ITS PRINCIPAL OFFICE AT 450 FIFTH STREET, N.W.,
WASHINGTON, D.C. 20549. THE COMPANY'S SERIES OF 12.64% PREFERRED STOCK AND
9.68% PREFERRED STOCK ARE LISTED ON THE NEW YORK STOCK EXCHANGE. REPORTS AND
OTHER INFORMATION CONCERNING THE COMPANY CAN BE INSPECTED AND COPIED AT THE
OFFICE OF SUCH EXCHANGE AT 20 BROAD STREET, NEW YORK, NEW YORK. SHAREHOLDERS
OF THE COMPANY ARE FURNISHED COPIES OF FINANCIAL STATEMENTS AS OF THE END OF
THE MOST RECENT FISCAL YEAR AUDITED AND REPORTED UPON (WITH AN OPINION
EXPRESSED) BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
THE FOLLOWING DOCUMENTS FILED WITH THE SEC PURSUANT TO THE EXCHANGE
ACT ARE INCORPORATED IN THIS PROSPECTUS BY REFERENCE:
1. THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1992.
2. THE COMPANY'S QUARTERLY REPORTS ON FORM 10-Q FOR THE QUARTERS
ENDED MARCH 31, 1993 AND JUNE 30, 1993.
IN ADDITION, ALL DOCUMENTS SUBSEQUENTLY FILED BY THE COMPANY
PURSUANT TO SECTION 13, 14 OR 15(D) OF THE EXCHANGE ACT PRIOR TO THE
TERMINATION OF THIS OFFERING SHALL BE DEEMED TO BE INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND TO BE A PART HEREOF FROM THE DATE OF
FILING OF SUCH DOCUMENTS (SUCH DOCUMENTS, AND THE DOCUMENTS ENUMERATED
ABOVE, BEING HEREIN REFERRED TO AS 'INCORPORATED DOCUMENTS').
ANY STATEMENT CONTAINED HEREIN OR IN AN INCORPORATED DOCUMENT SHALL
BE DEEMED TO BE MODIFIED OR SUPERSEDED FOR PURPOSES OF THIS PROSPECTUS TO
THE EXTENT THAT A STATEMENT CONTAINED IN ANY OTHER SUBSEQUENTLY FILED
INCORPORATED DOCUMENT OR IN AN ACCOMPANYING PROSPECTUS SUPPLEMENT
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 HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH
PERSON, INCLUDING ANY BENEFICIAL OWNER, TO WHOM A COPY OF THIS PROSPECTUS
HAS BEEN DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL OF THE INCORPORATED DOCUMENTS, OTHER THAN EXHIBITS TO
SUCH DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY
REFERENCE THEREIN. REQUESTS SHOULD BE DIRECTED TO MR. GARY L. FLORREICH,
ASSISTANT SECRETARY AND ASSISTANT TREASURER, LOUISIANA POWER & LIGHT
COMPANY, 639 LOYOLA AVENUE, NEW ORLEANS, LOUISIANA 70113, TELEPHONE
NUMBER: 504-569-4000. THE INFORMATION RELATING TO THE COMPANY CONTAINED
IN THIS PROSPECTUS AND ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DOES NOT
PURPORT TO BE COMPREHENSIVE AND SHOULD BE READ TOGETHER WITH THE
INFORMATION CONTAINED IN THE INCORPORATED DOCUMENTS.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR, WITH RESPECT TO ANY
SERIES OF THE NEW BONDS OR THE NEW PREFERRED STOCK, THE PROSPECTUS
SUPPLEMENT RELATING THERETO, AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY
THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS AND ANY PROSPECTUS
SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH
JURISDICTION.
NEITHER THE DELIVERY OF THIS PROSPECTUS AND A PROSPECTUS SUPPLEMENT
NOR ANY SALE MADE THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY
SINCE THE DATE OF THAT PROSPECTUS SUPPLEMENT.
THE COMPANY
THE COMPANY WAS INCORPORATED UNDER THE LAWS OF THE STATE OF
LOUISIANA ON OCTOBER 15, 1974 AND IS SUCCESSOR BY MERGER TO A PREDECESSOR
LOUISIANA POWER & LIGHT COMPANY, WHICH WAS INCORPORATED UNDER THE LAWS OF
THE STATE OF FLORIDA IN 1927. THE MERGER OF SUCH PREDECESSOR CORPORATION
INTO THE COMPANY BECAME EFFECTIVE ON FEBRUARY 28, 1975. THE COMPANY'S
PRINCIPAL EXECUTIVE OFFICE IS LOCATED AT 639 LOYOLA AVENUE, NEW ORLEANS,
LOUISIANA 70113. ITS TELEPHONE NUMBER, INCLUDING AREA CODE, IS (504)
569-4000.
THE COMPANY IS AN ELECTRIC PUBLIC UTILITY COMPANY WITH ALL OF ITS
OPERATIONS IN THE STATE OF LOUISIANA. ENTERGY CORPORATION, WHICH IS A
REGISTERED PUBLIC UTILITY HOLDING COMPANY UNDER THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935 ('HOLDING COMPANY ACT'), OWNS ALL OF THE
OUTSTANDING COMMON STOCK OF THE COMPANY. THE COMPANY, ARKANSAS POWER &
LIGHT COMPANY ('AP&L'), MISSISSIPPI POWER & LIGHT COMPANY ('MP&L') AND
NEW ORLEANS PUBLIC SERVICE INC. ('NOPSI') ARE THE PRINCIPAL OPERATING
ELECTRIC UTILITY SUBSIDIARIES OF ENTERGY CORPORATION. ENTERGY CORPORATION
ALSO OWNS ALL OF THE COMMON STOCK OF SYSTEM ENERGY RESOURCES, INC., A
GENERATING COMPANY, ENTERGY SERVICES, INC., A SERVICE COMPANY, ENTERGY
ENTERPRISES, INC., A NON-UTILITY COMPANY, ENTERGY OPERATIONS, INC., A
NUCLEAR MANAGEMENT SERVICES COMPANY, AND ENTERGY POWER, INC., A
SUBSIDIARY FORMED TO MARKET CAPACITY AND ENERGY FROM CERTAIN GENERATING
UNITS TO WHOLESALE MARKETS. ENTERGY CORPORATION ALSO HAS SEVERAL
SUBSIDIARIES FORMED TO PARTICIPATE IN UTILITY PROJECTS LOCATED OUTSIDE
THE ENTERGY SYSTEM'S AREAS OF RETAIL SERVICE, BOTH DOMESTICALLY AND IN
FOREIGN COUNTRIES.
THE COMPANY, AP&L, MP&L AND NOPSI OWN ALL OF THE CAPITAL STOCK OF
SYSTEM FUELS, INC., A SPECIAL PURPOSE COMPANY WHICH IMPLEMENTS AND/OR
MAINTAINS CERTAIN PROGRAMS FOR THE PROCUREMENT, DELIVERY AND STORAGE OF
FUEL SUPPLIES FOR CERTAIN ENTERGY CORPORATION SUBSIDIARIES.
USE OF PROCEEDS
THE NET PROCEEDS TO BE RECEIVED FROM THE ISSUANCE AND
SALE OF THE NEW BONDS AND/OR THE NEW PREFERRED STOCK WILL BE USED FOR
GENERAL CORPORATE PURPOSES, INCLUDING, WITHOUT LIMITATION, THE POSSIBLE
REDEMPTION OR OTHER ACQUISITION, IN WHOLE OR IN PART, OF CERTAIN OF THE
COMPANY'S OUTSTANDING SECURITIES. ANY SPECIFIC SECURITIES TO BE REDEEMED
OR ACQUIRED WITH THE PROCEEDS OF A SALE OF A SERIES OF NEW BONDS OR NEW
PREFERRED STOCK WILL BE SET FORTH IN THE PROSPECTUS SUPPLEMENT RELATING
TO THAT SERIES. REFERENCE IS MADE TO THE INCORPORATED DOCUMENTS WITH
RESPECT TO THE COMPANY'S MOST SIGNIFICANT CONTINGENCIES, ITS GENERAL
CAPITAL REQUIREMENTS AND ITS GENERAL FINANCING PLANS AND CAPABILITIES,
INCLUDING ITS SHORT-TERM BORROWING CAPACITY, AND EARNINGS COVERAGE
REQUIREMENTS UNDER THE COMPANY'S RESTATED ARTICLES OF INCORPORATION, AS
AMENDED ('ARTICLES OF INCORPORATION'), WHICH LIMIT THE AMOUNT OF
ADDITIONAL PREFERRED STOCK THE COMPANY MAY ISSUE, AND EARNINGS COVERAGE
AND OTHER REQUIREMENTS UNDER THE COMPANY'S MORTGAGE (AS HEREIN DEFINED)
WHICH LIMIT THE AMOUNT OF ADDITIONAL FIRST MORTGAGE BONDS THE COMPANY MAY
ISSUE.
DESCRIPTION OF NEW BONDS
GENERAL.THE NEW BONDS ARE TO BE ISSUED UNDER
THE COMPANY'S MORTGAGE AND DEED OF TRUST, DATED AS OF APRIL 1, 1944, WITH
THE CHASE NATIONAL BANK OF THE CITY OF NEW YORK (BANK OF MONTREAL TRUST
COMPANY, SUCCESSOR) ('CORPORATE TRUSTEE') AND CARL E. BUCKLEY (MARK F.
MCLAUGHLIN, SUCCESSOR), ('CO-TRUSTEE', AND TOGETHER WITH THE CORPORATE
TRUSTEE, THE 'TRUSTEES'), AS SUPPLEMENTED BY VARIOUS SUPPLEMENTAL
INDENTURES THERETO AND AS TO BE FURTHER SUPPLEMENTED TO PROVIDE
SPECIFICALLY FOR THE NEW BONDS (COLLECTIVELY REFERRED TO AS THE
'MORTGAGE'). ALL FIRST MORTGAGE BONDS ISSUED OR TO BE ISSUED UNDER
THE MORTGAGE ARE REFERRED TO HEREIN AS 'BONDS'. THE STATEMENTS
HEREIN CONCERNING THE BONDS, THE NEW BONDS AND THE MORTGAGE ARE
SUMMARY IN NATURE AND DO NOT PURPORT TO BE COMPLETE. THEY ARE SUBJECT
TO THE DETAILED PROVISIONS OF THE MORTGAGE. THE MORTGAGE AND A FORM
OF SUPPLEMENTAL INDENTURE ARE FILED AS EXHIBITS TO THE REGISTRATION
STATEMENT OF WHICH THIS PROSPECTUS IS A PART.
TERMS OF SPECIFIC SERIES OF THE NEW BONDS.A PROSPECTUS SUPPLEMENT
WILL DESCRIBE THE FOLLOWING TERMS OF, OR APPLICABLE TO, EACH SERIES OF
THE NEW BONDS TO BE ISSUED: (1) THE DESIGNATION OF SUCH SERIES OF THE NEW
BONDS; (2) THE AGGREGATE PRINCIPAL AMOUNT OF SUCH SERIES; (3) THE DATE ON
WHICH SUCH SERIES WILL MATURE; (4) THE RATE AT WHICH SUCH SERIES WILL
BEAR INTEREST AND THE DATE FROM WHICH SUCH INTEREST ACCRUES; (5) THE
DATES ON WHICH INTEREST WILL BE PAYABLE; (6) THE PRICES, INCLUDING THE
'GENERAL REDEMPTION PRICES' AND THE 'SPECIAL REDEMPTION PRICES' REFERRED
TO BELOW, AND THE OTHER TERMS AND CONDITIONS UPON WHICH THE PARTICULAR
SERIES MAY BE REDEEMED BY THE COMPANY PRIOR TO MATURITY; (7) WHETHER THE
DIVIDEND COVENANT DESCRIBED BELOW WILL BE APPLICABLE TO ANY SUCH SERIES;
(8) IF AN INSURANCE POLICY WILL BE PROVIDED FOR THE PAYMENT OF THE
PRINCIPAL OF AND/OR INTEREST ON THE NEW BONDS OF SUCH SERIES, THE TERMS
THEREOF; AND (9) ANY OTHER TERMS OF SUCH SERIES OF THE NEW BONDS, NOT
INCONSISTENT WITH THE PROVISIONS OF THE MORTGAGE.
FORM AND EXCHANGE.SEE 'BOOK ENTRY SECURITIES' BELOW.
REPLACEMENT FUND.IN ADDITION TO ACTUAL EXPENDITURES FOR MAINTENANCE
AND REPAIRS, THE COMPANY IS REQUIRED TO EXPEND OR DEPOSIT FOR EACH YEAR,
FOR REPLACEMENTS AND IMPROVEMENTS IN RESPECT OF THE MORTGAGED ELECTRIC,
GAS, STEAM AND/OR HOT WATER UTILITY PROPERTY AND CERTAIN AUTOMOTIVE
EQUIPMENT, AN AMOUNT EQUAL TO $800,000 PLUS 2 1/4% OF NET ADDITIONS TO
THE MORTGAGED ELECTRIC, GAS, STEAM AND/OR HOT WATER UTILITY PROPERTY MADE
AFTER DECEMBER 31, 1943 AND PRIOR TO THE BEGINNING OF SUCH YEAR. SUCH
REQUIREMENT MAY BE MET BY DEPOSITING CASH OR CERTIFYING GROSS PROPERTY
ADDITIONS OR EXPENDITURES FOR CERTAIN AUTOMOTIVE EQUIPMENT OR BY TAKING
CREDIT FOR BONDS AND QUALIFIED LIEN BONDS RETIRED. SUCH CASH MAY BE
WITHDRAWN AGAINST GROSS PROPERTY ADDITIONS OR WAIVER OF THE RIGHT TO
ISSUE BONDS.
SINKING OR IMPROVEMENT FUND.THE COMPANY IS REQUIRED TO MAKE ANNUAL
SINKING OR IMPROVEMENT FUND PAYMENTS FOR EACH OUTSTANDING SERIES OF BONDS
(OTHER THAN THE FORTY-THIRD, FORTY-FIFTH, FORTY-SIXTH, FORTY-NINTH AND
FIFTY-FIRST SERIES), STATED AS 1% PER YEAR OF THE GREATEST AMOUNT FOR
EACH SUCH SERIES OUTSTANDING PRIOR TO THE BEGINNING OF THE YEAR, LESS
CERTAIN BONDS RETIRED, AND WILL HAVE SUCH REQUIREMENTS FOR EACH SERIES OF
THE NEW BONDS (BEGINNING NOT LATER THAN 23 MONTHS FROM THE DATE OF EACH
SERIES OF THE NEW BONDS). THE COMPANY MAY ALSO TAKE AS A CREDIT AGAINST
THE SINKING OR IMPROVEMENT FUND REQUIREMENT IN RESPECT OF EACH SERIES OF
THE NEW BONDS AN AMOUNT, NOT EXCEEDING THE SINKING OR IMPROVEMENT FUND
REQUIREMENT IN ANY ONE YEAR, BASED UPON SINKING FUND CREDITS FOR CERTAIN
BONDS RETIRED PRIOR TO OR AT MATURITY. THE RESULTING REQUIREMENT WITH
RESPECT TO EACH SERIES OF THE NEW BONDS MAY BE SATISFIED IN CASH OR
PRINCIPAL AMOUNT OF SUCH SERIES OF NEW BONDS OR WITH PROPERTY ADDITIONS
AT 60% OF THE COST OR FAIR VALUE THEREOF, WHICHEVER IS LESS. THE SINKING
OR IMPROVEMENT FUND REQUIREMENT IN RESPECT OF EACH SERIES OF THE NEW
BONDS MAY BE ANTICIPATED AT ANY TIME. IF THE DATE FIXED FOR ANY RESULTING
REDEMPTION SHALL BE IN THE CALENDAR YEAR IN WHICH SUCH SINKING FUND
PAYMENT IS DUE, REDEMPTION SHALL BE AT THE SPECIAL REDEMPTION PRICE, BUT
IF THE DATE FIXED FOR ANY RESULTING REDEMPTION SHALL BE PRIOR TO THE
CALENDAR YEAR IN WHICH SUCH SINKING FUND PAYMENT IS DUE, REDEMPTION SHALL
BE AT THE GENERAL REDEMPTION PRICE AND SUBJECT TO THE LIMITATION ON SUCH
REDEMPTIONS AS SET FORTH UNDER 'REDEMPTION AND PURCHASE OF NEW BONDS' IN
THE ACCOMPANYING PROSPECTUS SUPPLEMENT. SIMILAR BUT NOT IDENTICAL
PROVISIONS ARE IN EFFECT WITH RESPECT TO THE BONDS OF OTHER SERIES NOW
OUTSTANDING.
SPECIAL PROVISIONS FOR RETIREMENT OF BONDS.IF, DURING ANY 12 MONTHS'
PERIOD, MORTGAGED PROPERTY IS DISPOSED OF BY ORDER OF OR TO ANY
GOVERNMENTAL AUTHORITY, RESULTING IN THE RECEIPT OF $5,000,000 OR MORE AS
PROCEEDS, THE COMPANY (SUBJECT TO CERTAIN CONDITIONS) MUST APPLY SUCH
PROCEEDS, LESS CERTAIN DEDUCTIONS, TO THE RETIREMENT OF BONDS. THE NEW
BONDS ARE REDEEMABLE FOR THIS PURPOSE AT THE SPECIAL REDEMPTION PRICES
SET FORTH UNDER 'REDEMPTION AND PURCHASE OF NEW BONDS' IN THE
ACCOMPANYING PROSPECTUS SUPPLEMENT.
SECURITY.THE NEW BONDS, TOGETHER WITH ALL OTHER BONDS, WILL BE
SECURED BY THE MORTGAGE, WHICH CONSTITUTES, IN THE OPINION OF THE GENERAL
COUNSEL FOR THE COMPANY, A FIRST MORTGAGE LIEN ON ALL OF THE PRESENT
PROPERTIES OF THE COMPANY (EXCEPT AS STATED BELOW), 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
BUSINESS, AND (C) EXCEPTED ENCUMBRANCES. THERE ARE EXCEPTED FROM THE LIEN
OF THE MORTGAGE ALL CASH AND SECURITIES; CERTAIN EQUIPMENT, MATERIALS AND
SUPPLIES; AUTOMOBILES AND OTHER VEHICLES AND AIRCRAFT; TIMBER, MINERAL
RIGHTS AND ROYALTIES; AND RECEIVABLES, CONTRACTS, LEASES AND OPERATING
AGREEMENTS.
THE MORTGAGE CONTAINS PROVISIONS 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 ON THE
MORTGAGED PROPERTY, PRIOR TO THE BONDS, FOR THE PAYMENT OF THEIR
REASONABLE COMPENSATION AND EXPENSES AND FOR INDEMNITY AGAINST CERTAIN
LIABILITIES.
THE MORTGAGE CONTAINS RESTRICTIONS, SOME OF WHICH APPLY ONLY SO LONG
AS CERTAIN PRIOR SERIES ARE OUTSTANDING, ON THE ACQUISITION OF PROPERTY
SUBJECT TO LIENS AND ON THE ISSUANCE OF BONDS UNDER DIVISIONAL OR PRIOR
LIEN MORTGAGES.
ISSUANCE OF ADDITIONAL BONDS.THE MAXIMUM PRINCIPAL AMOUNT OF BONDS
THAT MAY BE ISSUED UNDER THE MORTGAGE IS LIMITED TO ONE HUNDRED BILLION
DOLLARS AT ANY TIME OUTSTANDING, SUBJECT TO PROPERTY ADDITIONS, EARNINGS
AND OTHER LIMITATIONS OF THE MORTGAGE. BONDS OF ANY SERIES MAY BE ISSUED
FROM TIME TO TIME UPON THE BASES OF (1) 60% OF PROPERTY ADDITIONS AFTER
ADJUSTMENTS TO OFFSET RETIREMENTS, (2) RETIREMENT OF BONDS OR QUALIFIED
LIEN BONDS, AND (3) DEPOSIT OF CASH. PROPERTY ADDITIONS GENERALLY INCLUDE
ELECTRIC, GAS, STEAM AND/OR HOT WATER PROPERTY ACQUIRED AFTER DECEMBER
31, 1943, BUT MAY NOT INCLUDE SECURITIES, AUTOMOBILES OR OTHER VEHICLES
OR AIRCRAFT OR PROPERTY USED PRINCIPALLY FOR THE PRODUCTION OR GATHERING
OF NATURAL GAS. THE COMPANY ESTIMATES THAT, AS OF SEPTEMBER 30, 1993,
THERE WERE APPROXIMATELY $89.6 MILLION OF UNFUNDED PROPERTY ADDITIONS
AVAILABLE FOR THE ISSUANCE OF ADDITIONAL BONDS.
WITH CERTAIN EXCEPTIONS IN THE CASE OF (2) ABOVE, THE ISSUANCE OF
ADDITIONAL BONDS IS SUBJECT TO ADJUSTED NET EARNINGS (BEFORE INTEREST AND
INCOME TAXES) FOR 12 CONSECUTIVE MONTHS OUT OF THE 15 MONTHS IMMEDIATELY
PRECEDING THE ISSUANCE OF SUCH BONDS BEING AT LEAST TWICE THE ANNUAL
INTEREST REQUIREMENTS ON ALL BONDS AT THE TIME OUTSTANDING, INCLUDING THE
ADDITIONAL BONDS BEING ISSUED, AND ALL INDEBTEDNESS OF PRIOR RANK. SUCH
ADJUSTED NET EARNINGS ARE COMPUTED AFTER PROVISIONS FOR RETIREMENT AND
DEPRECIATION OF PROPERTY AT LEAST EQUAL TO THE REPLACEMENT FUND
REQUIREMENTS FOR SUCH PERIOD.
THE COMPANY EXPECTS TO ISSUE THE NEW BONDS ON THE BASIS OF UNFUNDED
NET PROPERTY ADDITIONS AND/OR ON THE BASIS OF THE RETIREMENT OF BONDS.
THE COMPANY HAS RESERVED THE RIGHT (WITHOUT ANY CONSENT OR OTHER
ACTION BY HOLDERS OF THE 1999 SERIES BONDS OR ANY SUBSEQUENTLY CREATED
SERIES, INCLUDING THE NEW BONDS) TO INCLUDE NUCLEAR FUEL (AND SIMILAR OR
ANALOGOUS DEVICES OR SUBSTANCES) AS PROPERTY ADDITIONS. THE COMPANY HAS
ALSO RESERVED THE RIGHT TO AMEND THE MORTGAGE, WITHOUT ANY CONSENT OR
OTHER ACTION OF THE HOLDERS OF THE 2008 SERIES BONDS OR ANY SUBSEQUENTLY
CREATED SERIES (INCLUDING THE NEW BONDS), TO MAKE AVAILABLE AS PROPERTY
ADDITIONS ANY FORM OF SPACE SATELLITES (INCLUDING SOLAR POWER
SATELLITES), SPACE STATIONS AND OTHER ANALOGOUS FACILITIES.
NO BONDS MAY BE ISSUED ON THE BASIS OF PROPERTY ADDITIONS SUBJECT TO
QUALIFIED LIENS IF THE QUALIFIED LIEN BONDS SECURED THEREBY EXCEED 50% OF
SUCH PROPERTY ADDITIONS, OR IF THE QUALIFIED LIEN BONDS AND BONDS THEN
OUTSTANDING WHICH HAVE BEEN ISSUED AGAINST PROPERTY ADDITIONS SUBJECT TO
CONTINUING QUALIFIED LIENS AND CERTAIN OTHER ITEMS WOULD IN THE AGGREGATE
EXCEED 15% OF THE BONDS AND QUALIFIED LIEN BONDS OUTSTANDING.
RELEASE AND SUBSTITUTION OF PROPERTY.PROPERTY MAY BE RELEASED FROM
THE LIEN OF THE MORTGAGE UPON THE BASES OF (1) DEPOSIT OF CASH OR, TO A
LIMITED EXTENT, PURCHASE MONEY MORTGAGES, (2) PROPERTY ADDITIONS, AFTER
ADJUSTMENTS IN CERTAIN CASES TO OFFSET RETIREMENTS AND AFTER MAKING
ADJUSTMENTS FOR QUALIFIED LIEN BONDS OUTSTANDING AGAINST PROPERTY
ADDITIONS, AND (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 WITHOUT MEETING AN EARNINGS TEST. 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.
DIVIDEND COVENANT.THE COMPANY MAY COVENANT IN SUBSTANCE THAT, SO
LONG AS ANY NEW BONDS OF A PARTICULAR SERIES REMAIN OUTSTANDING, IT WILL
NOT PAY ANY CASH DIVIDENDS ON COMMON STOCK AFTER A SELECTED DATE CLOSE TO
THE DATE OF THE ORIGINAL ISSUANCE OF SUCH SERIES OF NEW BONDS (OTHER THAN
CERTAIN DIVIDENDS THAT MAY BE DECLARED BY THE COMPANY PRIOR TO SUCH
SELECTED DATE) EXCEPT FROM CREDITS TO EARNED SURPLUS AFTER SUCH SELECTED
DATE PLUS AN AMOUNT UP TO $345 MILLION AND PLUS SUCH ADDITIONAL AMOUNTS
AS SHALL BE APPROVED BY THE SEC. THE PROSPECTUS SUPPLEMENT RELATING TO A
PARTICULAR SERIES OF NEW BONDS WILL STATE WHETHER THIS COVENANT WILL
APPLY TO SUCH SERIES.
MODIFICATION OF THE MORTGAGE.THE RIGHTS OF THE BONDHOLDERS MAY BE
MODIFIED WITH THE CONSENT OF THE HOLDERS OF 70% OF THE BONDS, AND, IF
LESS THAN ALL SERIES OF BONDS ARE AFFECTED, THE CONSENT ALSO OF THE
HOLDERS OF 70% OF THE BONDS OF EACH SERIES AFFECTED. THE COMPANY HAS
RESERVED THE RIGHT (WITHOUT ANY CONSENT OR OTHER ACTION BY HOLDERS OF THE
2000 SERIES BONDS OR ANY SUBSEQUENTLY CREATED SERIES, INCLUDING THE NEW
BONDS) TO SUBSTITUTE FOR THE FOREGOING PROVISION A PROVISION TO THE
EFFECT THAT THE RIGHTS OF THE BONDHOLDERS MAY BE MODIFIED WITH THE
CONSENT OF HOLDERS OF 66 2/3% OF THE BONDS, AND, IF LESS THAN ALL SERIES
OF BONDS ARE AFFECTED, THE CONSENT ALSO OF HOLDERS OF 66 2/3% OF THE
BONDS OF EACH SERIES AFFECTED. IN GENERAL, NO MODIFICATION OF THE TERMS
OF PAYMENT OF PRINCIPAL OR INTEREST, NO MODIFICATION OF THE OBLIGATIONS
OF THE COMPANY UNDER SECTION 64 OF THE MORTGAGE (UNTIL THE FOREGOING
SUBSTITUTION IS MADE), AND NO MODIFICATION AFFECTING THE LIEN OF THE
MORTGAGE OR REDUCING THE PERCENTAGE REQUIRED FOR MODIFICATION, IS
EFFECTIVE AGAINST ANY BONDHOLDER WITHOUT HIS CONSENT.
DEFAULTS AND NOTICE THEREOF.DEFAULTS ARE DEFINED IN THE MORTGAGE AS:
DEFAULT IN PAYMENT OF PRINCIPAL; DEFAULT FOR 60 DAYS IN PAYMENT OF
INTEREST OR INSTALLMENTS OF FUNDS FOR RETIREMENT OF BONDS; CERTAIN EVENTS
IN BANKRUPTCY, INSOLVENCY OR REORGANIZATION; DEFAULTS WITH RESPECT TO
QUALIFIED LIEN BONDS; AND DEFAULT FOR 90 DAYS AFTER NOTICE IN OTHER
COVENANTS. THE TRUSTEES MAY WITHHOLD NOTICE OF DEFAULT (EXCEPT IN PAYMENT
OF PRINCIPAL, INTEREST OR FUNDS FOR RETIREMENT OF BONDS) IF THEY
DETERMINE IT IS IN THE INTERESTS OF THE BONDHOLDERS.
THE CORPORATE TRUSTEE OR THE HOLDERS OF 25% OF THE BONDS MAY DECLARE
THE PRINCIPAL AND INTEREST DUE ON DEFAULT, BUT A MAJORITY MAY ANNUL SUCH
DECLARATION IF SUCH DEFAULT HAS BEEN CURED. NO HOLDER OF BONDS MAY
ENFORCE THE LIEN OF THE MORTGAGE WITHOUT GIVING THE TRUSTEES WRITTEN
NOTICE OF A DEFAULT AND UNLESS THE HOLDERS OF 25% OF THE BONDS HAVE
REQUESTED THE TRUSTEES IN WRITING TO ACT AND OFFERED THEM REASONABLE
OPPORTUNITY TO ACT AND INDEMNITY SATISFACTORY TO THE TRUSTEES AGAINST THE
COSTS, EXPENSES AND LIABILITIES TO BE INCURRED THEREBY AND THE TRUSTEES
SHALL HAVE FAILED TO ACT. HOLDERS OF A MAJORITY OF THE BONDS MAY DIRECT
THE TIME, METHOD AND PLACE OF CONDUCTING ANY PROCEEDINGS FOR ANY REMEDY
AVAILABLE TO THE TRUSTEES, OR EXERCISING ANY TRUST OR POWER CONFERRED
UPON THE TRUSTEES.
THE COMPANY MUST FILE AN ANNUAL CERTIFICATE WITH THE CORPORATE
TRUSTEE AS TO COMPLIANCE WITH THE PROVISIONS OF THE MORTGAGE AND AS TO
THE ABSENCE OF DEFAULT WITH RESPECT TO ANY OF THE COVENANTS CONTAINED IN
THE MORTGAGE.
DESCRIPTION OF NEW PREFERRED STOCK
GENERAL.THE ARTICLES OF
INCORPORATION PROVIDE FOR TWO CLASSES OF SERIAL PREFERRED STOCK OF THE
COMPANY, THE PREFERRED STOCK, $100 PAR VALUE ('$100 PREFERRED STOCK'),
AND THE PREFERRED STOCK, $25 PAR VALUE ('$25 PREFERRED STOCK') (THE $100
PREFERRED STOCK AND THE $25 PREFERRED STOCK BEING HEREIN COLLECTIVELY
REFERRED TO AS THE 'PREFERRED STOCK'). THE $100 PREFERRED STOCK
AND THE $25 PREFERRED STOCK HAVE THE SAME RANK AND, EXCEPT AS
TO THOSE CHARACTERISTICS RELATING TO PAR VALUE, VOTING RIGHTS
(INCLUDING MATTERS RELATING TO QUORUMS AND ADJOURNMENTS)
AND IN CERTAIN OTHER RESPECTS AS TO WHICH THERE MAY BE VARIATIONS AMONG
SERIES, THE SHARES OF EACH SERIES OF PREFERRED STOCK CONFER EQUAL RIGHTS
UPON THE HOLDERS. THE RESPECTS IN WHICH THERE MAY BE VARIATIONS AS AMONG
SERIES CONSIST OF (A) THE NUMBER OF SHARES CONSTITUTING EACH SERIES AND
THE DISTINCTIVE SERIAL DESIGNATION THEREOF, (B) THE ANNUAL DIVIDEND RATE,
THE INITIAL DIVIDEND PAYMENT DATE AND THE DATE FROM WHICH DIVIDENDS SHALL
BE CUMULATIVE, (C) THE AMOUNTS PAYABLE UPON REDEMPTION, AND (D) THE TERMS
AND AMOUNT OF SINKING FUND REQUIREMENTS (IF ANY) FOR THE PURCHASE OR
REDEMPTION OF SHARES OF EACH SERIES OF PREFERRED STOCK OTHER THAN THE
FIRST THROUGH TENTH SERIES OF THE $100 PREFERRED STOCK HERETOFORE ISSUED
BY THE COMPANY. WHEN A NEW SERIES OF PREFERRED STOCK IS CREATED, THE
NUMBER OF SHARES CONSTITUTING SUCH SERIES, ITS DISTINCTIVE SERIAL
DESIGNATION AND ITS DISTINCTIVE CHARACTERISTICS (IN THOSE LIMITED
RESPECTS AS TO WHICH THERE MAY BE VARIATIONS) ARE SET BY AN AMENDMENT TO
THE ARTICLES OF INCORPORATION. THE STATEMENTS HEREIN CONCERNING THE
PREFERRED STOCK AND THE NEW PREFERRED STOCK ARE SUMMARY IN NATURE AND DO
NOT PURPORT TO BE COMPLETE. SUCH STATEMENTS DO NOT ATTEMPT TO RELATE OR
TO GIVE EFFECT TO THE APPLICABLE PROVISIONS OF LOUISIANA STATUTORY OR
DECISIONAL LAW AND ARE SUBJECT IN ALL RESPECTS TO THE DETAILED PROVISIONS
OF THE ARTICLES OF INCORPORATION AND TO THE ARTICLES OF AMENDMENT TO BE
ADOPTED FOR EACH SERIES OF NEW PREFERRED STOCK. THE ARTICLES OF
INCORPORATION AND THE FORM OF ARTICLES OF AMENDMENT ARE FILED AS EXHIBITS
TO THE REGISTRATION STATEMENT OF WHICH THIS PROSPECTUS IS A PART.
FORM AND EXCHANGE.SEE 'BOOK ENTRY SECURITIES' BELOW.
TERMS OF SPECIFIC SERIES OF THE NEW PREFERRED STOCK.A PROSPECTUS
SUPPLEMENT WILL DESCRIBE THE FOLLOWING TERMS OF EACH SERIES OF NEW
PREFERRED STOCK TO BE ISSUED: (1) THE DESIGNATION OF SUCH SERIES OF NEW
PREFERRED STOCK; (2) THE PAR VALUE OF EACH SHARE; (3) THE NUMBER OF
SHARES OF NEW PREFERRED STOCK IN SUCH SERIES; (4) THE PURCHASE PRICE AND
INITIAL PUBLIC OFFERING PRICE, IF ANY, OF THE SHARES OF SUCH SERIES; (5)
THE DIVIDEND RATE; (6) THE INITIAL DIVIDEND PAYMENT DATE AND THE DATE
FROM WHICH DIVIDENDS WILL BE CUMULATIVE; (7) THE TERMS AND CONDITIONS
PURSUANT TO WHICH, AND THE PRICES AT WHICH, THE COMPANY MAY REDEEM SHARES
OF SUCH SERIES; (8) THE TERMS AND AMOUNT OF ANY SINKING FUND REQUIREMENTS
APPLICABLE TO SUCH SERIES; AND (9) ANY OTHER TERMS OF SUCH SERIES OF THE
NEW PREFERRED STOCK, NOT INCONSISTENT WITH THE ARTICLES OF INCORPORATION.
DIVIDEND RIGHTS.EACH SERIES OF THE NEW PREFERRED STOCK, PARI PASSU
with each other series of the Preferred Stock, shall be entitled, when
and as declared by the Board of Directors, in preference to the common
stock, to dividends at the rate stated in the title thereof, payable
quarterly on February 1, May 1, August 1 and November 1 of each year.
Voting Rights.Except for that purpose only for which the right to
vote is expressly conferred upon the holders of the Preferred Stock by
the Articles of Incorporation, the holders of the Preferred Stock shall
have no power to vote and shall be entitled to no notice of any meeting
of stockholders of the Company.
If and when dividends payable on Preferred Stock of the Company
shall be in default in an amount equal to four full quarterly payments or
more per share, and thereafter until all dividends on any such Preferred
Stock in default shall have been paid, the holders of all Preferred
Stock, voting separately as a class in such manner that the holders of
the $100 Preferred Stock shall have one vote per share and the holders of
the $25 Preferred Stock shall have one-quarter vote per share, shall be
entitled to elect the smallest number of directors necessary to
constitute a majority of the full Board of Directors of the Company, and
the holders of the common stock, voting separately as a class, shall be
entitled to elect the remaining directors of the Company.
Restrictions on Issuance of Stock, Restrictions on Altering Terms of
Preferred Stock.So long as any shares of the Preferred Stock are
outstanding, the Company shall not, without the consent (given by vote at
a meeting called for that purpose) of at least two-thirds of the total
number of shares of the Preferred Stock then outstanding (for purposes of
this computation each share of the $100 Preferred Stock shall count as
one share, and each share of the $25 Preferred Stock shall count as
one-quarter share):
(1) Issue any new stock which would rank prior to the Preferred
Stock or issue any security convertible into shares of any such stock
except for the purpose of providing funds for the redemption of all of
the Preferred Stock then outstanding; or
(2) Amend or alter any of the express terms of the Preferred Stock
then outstanding in a manner prejudicial to the holders thereof; the
increase or decrease in the authorized amount of the Preferred Stock or
the creation, or increase or decrease in the authorized amount, of any
new class of stock ranking on a parity with the Preferred Stock shall
not, for the purposes of this paragraph, be deemed to be prejudicial to
the holders of the Preferred Stock.
Restrictions on Merger, Sale of Assets, Issue of Unsecured Debt,
Sale of Additional Preferred Stock.So long as any shares of the Preferred
Stock are outstanding, the Company shall not, without the consent (given
by vote in a meeting called for that purpose) of the holders of a
majority of the total number of shares of the Preferred Stock then
outstanding (for purposes of this computation each share of the $100
Preferred Stock shall count as one share, and each share of the $25
Preferred Stock shall count as one-quarter share):
(1) Merge or consolidate with or into any other corporation, or
sell or otherwise dispose of all or substantially all of the assets of
the Company, without obtaining the prior approval of regulatory authority
of the United States under the provisions of the Holding Company Act; or
(2) Issue or assume any unsecured indebtedness for purposes other
than (i) the refunding of outstanding unsecured indebtedness theretofore
issued or assumed by the Company, (ii) the reacquisition, redemption or
other retirement of any indebtedness which has been authorized by
regulatory authority of the United States under the provisions of the
Holding Company Act, or (iii) the reacquisition, redemption or other
retirement of all outstanding shares of the Preferred Stock, or preferred
stock ranking prior to, or PARI PASSU with, the Preferred Stock, if
immediately after such issue or assumption, the total principal amount of
all unsecured indebtedness issued or assumed by the Company, including
unsecured indebtedness then to be issued or assumed (but excluding the
principal amount then outstanding of any unsecured indebtedness having a
maturity in excess of ten years and in amount not exceeding 10% of the
aggregate of (a) and (b) below) would exceed 10% of the aggregate of (a)
the total principal amount of all bonds or other securities representing
secured indebtedness issued or assumed by the Company and then to be
outstanding, and (b) the capital and surplus of the Company as then to be
stated on the books of account of the Company. When unsecured debt of a
maturity in excess of ten years shall become of a maturity of ten years
or less, it shall then be regarded as unsecured debt of a maturity of
less than ten years and shall be computed with such debt for the purpose
of determining the percentage ratio to the sum of (a) and (b) above of
unsecured debt of a maturity of less than ten years, and when provision
shall have been made, whether through a sinking fund or otherwise, for
the retirement, prior to its maturity, of unsecured debt of a maturity in
excess of ten years, the amount of any such security so required to be
retired in less than ten years shall be regarded as unsecured debt of a
maturity of less than ten years (and not as unsecured debt of a maturity
in excess of ten years) and shall be computed with such debt for the
purpose of determining the percentage ratio to the sum of (a) and (b)
above of unsecured debt of a maturity of less than ten years, provided,
however, that the payment due upon the maturity of unsecured debt having
an original single maturity in excess of ten years or the payment due
upon the latest maturity of any serial debt which had original maturities
in excess of ten years shall not, for purposes of this provision, be
regarded as unsecured debt of a maturity of less than ten years until
such payment or payments shall be required to be made within five years
(provided that the words 'five years' shall read 'three years' when none
of the 4.96% Preferred Stock remains outstanding); furthermore, when
unsecured debt of a maturity of less than ten years shall exceed 10% of
the sum of (a) and (b) above, no additional unsecured debt shall be
issued or assumed (except for the purposes set forth in (i), (ii) and
(iii) above) until such ratio is reduced to 10% of the sum of (a) and (b)
above; or
(3) Issue, sell or otherwise dispose of any shares of the Preferred
Stock, or of any other class of stock ranking on a parity with the
Preferred Stock as to dividends or in liquidation, dissolution, winding
up or distribution, (a) so long as any of the 4.96% Preferred Stock
remains outstanding, unless the net income of the Company available for
dividends for a period of 12 consecutive calendar months within the 15
calendar months immediately preceding the issuance, sale or disposition
of such stock, is at least equal to twice the
annual dividend requirements on all outstanding shares of the Preferred
Stock and of all other classes of stock ranking prior to or on a parity
with the Preferred Stock, including the shares proposed to be issued, and
(b) so long as any Preferred Stock remains outstanding, unless the gross
income of the Company for such period available for the payment of
interest shall have been at least 1 times the sum of the annual interest
charges on all interest bearing indebtedness of the Company and the
annual dividend requirements on all outstanding Preferred Stock and of
all other classes of stock ranking prior to, or on a parity with, the
Preferred Stock including the shares proposed to be issued, and (c)
unless the aggregate of the capital of the Company applicable to the
common stock and the surplus of the Company shall be not less than the
aggregate amount payable on the involuntary dissolution, liquidation or
winding up of the Company in respect of all shares of the Preferred Stock
and all shares of stock, if any, ranking prior thereto, or on a parity
therewith, as to dividends or distributions, which will be outstanding
after the issue of the shares proposed to be issued.
Liquidation Rights.In the event of any voluntary liquidation,
dissolution or winding up of the Company, the Preferred Stock shall have
a preference over the common stock until an amount equal to the then
current redemption price shall have been paid. In the event of any
involuntary liquidation, dissolution or winding up of the Company, the
Preferred Stock shall also have a preference over the common stock until
the par value thereof plus accumulated and unpaid dividends thereon shall
have been paid.
Pre-emptive or Other Subscription Rights.No holder of any stock of
the Company shall be entitled as of right to purchase or subscribe for
any part of any stock of the Company or of any additional stock of any
class to be issued by reason of any increase of the authorized capital
stock of the Company.
Liability to Further Calls and to Assessment.All of the New
Preferred Stock will be validly issued and fully paid and non-assessable
upon receipt by the Company of the purchase price thereof.
Limitations on Payment of Common Stock Dividends.The Articles of
Incorporation in effect restrict the payment of dividends on common stock
to 75% of net income available for common stock dividends if the
percentage of common stock equity to total capitalization, as defined, is
between 20% and 25%, and to 50% of such net income if such percentage is
less than 20%. At any time when common stock equity is 25% or more of
total capitalization, the Company may not declare dividends on the common
stock which would reduce common stock equity below 25% of total
capitalization, except as hereinbefore provided. Certain other
limitations on payment of common stock dividends also exist in the
Articles of Incorporation.
Certain Terms Applicable to Redemption.In general, at any time when
dividends payable on any Preferred Stock are in default, the Company may
not (1) make any payment, or set aside funds for payment, into any
sinking fund for the purchase or redemption of any shares of the
Preferred Stock, or (2) redeem, purchase or otherwise acquire less than
all of the shares of the Preferred Stock, in either case unless approval
is obtained under the Holding Company Act. Any shares of the Preferred
Stock that are redeemed, purchased or acquired shall be retired and
cancelled.
Transfer Agent and Registrar.The transfer agent and registrar for
the New Preferred Stock is Mellon Securities Trust Company, New York, New
York.
RATIOS OF EARNINGS TO FIXED CHARGES AND
RATIOS OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDSThe Company
has calculated ratios of earnings to fixed charges and ratios of earnings
to fixed charges and preferred dividends pursuant to Item 503 of SEC
Regulation S-K as follows:
TWELVE MONTHS ENDED
-----------------------------------------------------
DECEMBER 31,
---------------------------------------- JUNE 30,
1988 1989 1990 1991 1992 1993
Ratios of Earnings to Fixed Charges(a)...................... 1.71 1.79 2.32 2.40 2.79 2.85
Ratios of Earnings to Fixed Charges and Preferred
Dividends(a)(b)........................................... 1.32 1.39 1.87 1.95 2.18 2.24
(a)'Earnings', as defined by SEC Regulation S-K, represent the
aggregate of (1) net income, (2) taxes based on income, (3) investment
tax credit adjustments -- net and (4) fixed charges. 'Fixed Charges'
include interest (whether expensed or capitalized), related amortization
and interest applicable to rentals charged to operating expenses.
(b)'Preferred Dividends', as defined by SEC
Regulation S-K, are computed by dividing the preferred dividend
requirement by one hundred percent (100%) minus the effective income tax
rate.
EXPERTS AND LEGALITY
The financial statements and the related
financial statement schedules incorporated in this Prospectus by
reference from the Company's Annual Report on Form 10-K have been audited
by Deloitte & Touche, independent auditors, as stated in their reports,
which are incorporated by reference herein, and have been so incorporated
in reliance upon the reports of such firm given upon their authority as
experts in auditing and accounting.
With respect to the unaudited interim financial information
incorporated herein by reference, Deloitte & Touche have applied limited
procedures in accordance with professional standards for a review of such
information. However, as stated in their reports included in the
Company's Quarterly Reports on Form 10-Q, and incorporated by reference
herein, they did not audit and do not express an opinion on that interim
financial information. Accordingly, the degree of reliance on their
reports on such information should be restricted in light of the limited
nature of the review procedures applied. Deloitte & Touche are not
subject to the liability provisions of Section 11 of the Securities Act
of 1933 for their reports on the unaudited interim financial information
because those reports are not 'reports' or 'parts' of the Registration
Statement prepared or certified by an accountant within the meaning of
Sections 7 and 11 thereof.
The statements at the date of this Prospectus as to matters of law
and legal conclusions made under 'Description of New Bonds' and
'Description of New Preferred Stock' have been reviewed by Monroe &
Lemann (A Professional Corporation), General Counsel for the Company,
and, except as to 'Security' under 'Description of New Bonds', by Reid &
Priest, and are set forth herein in reliance upon the opinions of said
firms, respectively, and upon their authority as experts. The statements
made in the Incorporated Documents at the date of this Prospectus as to
matters of law and legal conclusions, based on the belief or opinion of
the Company or otherwise, pertaining to titles to properties, franchises
and other operating rights of the Company, regulations to which the
Company is subject and any legal proceedings to which the Company is a
party, are made on the authority of Monroe & Lemann (A Professional
Corporation), and such statements are included in such documents and
herein in reliance upon their authority as experts.
The legality of the New Bonds and the New Preferred Stock will be
passed upon for the Company by Monroe & Lemann (A Professional
Corporation), 201 St. Charles Avenue, Suite 3300, New Orleans, Louisiana,
and Reid & Priest, 40 West 57th Street, New York, New York, and for the
underwriter(s), dealer(s), agent(s) or purchaser(s) by Winthrop, Stimson,
Putnam & Roberts, One Battery Park Plaza, New York, New York. However,
all legal matters pertaining to the organization of the Company, titles
to property, franchises and the lien of the Mortgage and all matters of
Louisiana law will be passed upon only by Monroe & Lemann (A Professional
Corporation).
PLAN OF DISTRIBUTION
The Company may sell the New Bonds and the New
Preferred Stock in one or more sales in any of three ways: (i) through
one or more underwriters or dealers; (ii) directly to a limited number of
purchasers or to a single purchaser; or (iii) through one or more agents.
The Prospectus Supplement relating to a series of the New Bonds ('Offered
Bonds') or to a series of the New Preferred Stock ('Offered Stock') will
set forth the terms of the offering, as applicable, of the Offered Bonds
or the Offered Stock, including the name or names of any underwriters,
dealers or agents, the purchase price of such Offered Bonds or Offered
Stock and the 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
changed from time to time.
If underwriters are used in the sale, the Offered Bonds or Offered
Stock will be purchased 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. The underwriter or
underwriters with respect to a particular underwritten offering of
Offered Bonds or Offered Stock 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 underwriters to purchase
the Offered Bonds or Offered Stock will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all such
Offered Bonds or Offered Stock if any are purchased; provided that the
agreement between the Company and the underwriter or underwriters
providing for the sale of the Offered Bonds or Offered Stock may provide
that under certain circumstances involving a default of underwriters,
less than all of the Offered Bonds or Offered Stock may be purchased.
Offered Bonds or Offered Stock may be sold directly by the Company
or through agents designated by the Company from time to time. The
Prospectus Supplement will set forth the name of any agent involved in
the offer or sale of the Offered Bonds or Offered Stock in respect of
which the Prospectus Supplement is delivered as well as any commissions
payable by the Company to such agent. 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 or Offered Stock from
the Company at the public offering price 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 commission payable for
solicitation of such contracts.
Each Prospectus Supplement relating to a particular offering of
Offered Bonds or Offered Stock will contain a statement (i) as to whether
or not the Company is able to predict the existence of a secondary market
for such securities and, if such existence is predicted, as to the extent
of such secondary market, and (ii) if such securities are to be purchased
by an underwriter or underwriters, as to whether or not such underwriter
or underwriters intend to make a market in such securities.
Subject to certain conditions, the Company may agree to indemnify
any underwriters, dealers, agents or purchasers, and any insurer
providing an insurance policy for the payment of principal of and/or
interest on New Bonds, and their controlling persons against certain
civil liabilities, including liabilities under the Securities Act of
1933.
BOOK ENTRY SECURITIES
Unless otherwise indicated in a Prospectus
Supplement, the New Preferred Stock and the New Bonds will be issued in
the form of one or more fully registered stock certificates or bonds, as
the case may be, that will be deposited with, or on behalf of, The
Depository Trust Company, New York, New York ('DTC'), or such other
depository as may be subsequently designated, and registered in the name
of Cede & Co., as nominee for DTC.
So long as DTC, or its nominee, is the owner of the New Preferred
Stock or the New Bonds, DTC or such nominee, as the case may be, will be
considered the sole registered holder of the New Preferred Stock or the
New Bonds for all purposes under the Articles of Incorporation or
Mortgage. Payments of redemption price and dividends on the New Preferred
Stock and payments of principal of and premium, if any, and interest on
the New Bonds will be made to DTC, or its nominee, as the case may be, as
the holder of the New Preferred Stock or the New Bonds. Except as set
forth below, owners of beneficial interests in the New Preferred Stock or
the New Bonds will not be entitled to have any of the individual New
Preferred Stock or New Bonds registered in their names, will not receive
or be entitled to receive physical delivery of any such New Preferred
Stock or New Bonds and will not be considered the holders thereof under
the Articles of Incorporation or Mortgage.
If DTC is at any time unwilling or unable to continue as depository
and a successor depository is not appointed, the Company will issue
certificates for New Preferred Stock or individual registered New Bonds
in exchange for the New Preferred Stock or New Bonds held by DTC. In
addition, the Company may at any time and in its sole discretion
determine not to have the New Preferred Stock or New Bonds held by DTC
and, in such event, will issue New Preferred Stock certificates or
individual registered New Bonds in exchange for the New Preferred Stock
or New Bonds held by DTC. In any such instance, an owner of a beneficial
interest in the New Preferred Stock or the New Bonds will be entitled to
physical delivery of New Preferred Stock certificates or individual New
Bonds equal in par value or principal amount to its beneficial interest
and to have such New Preferred Stock or New Bonds registered in its name.
Individual New Bonds so issued will be issued as registered New Bonds in
denominations of $1,000 or any multiple thereof.
Upon the issuance of the New Preferred Stock or the New Bonds, DTC
will credit, on its book-entry registration and transfer system, the
respective par values or principal amounts of beneficial interests to the
accounts of institutions that have accounts with DTC ('Participants').
The accounts to be credited will initially be designated by any
Underwriter or the Company. Ownership of beneficial interests in the New
Preferred Stock or the New Bonds will be limited to Participants or
persons that may hold interests through Participants. Ownership of
beneficial interests in the New Preferred Stock or the New Bonds will be
shown on, and the transfer of that ownership will be effected only
through, records maintained by DTC (with respect to the Participants'
interests) or by Participants or persons that hold through Participants
(with respect to persons other than Participants). The laws of some
states require that certain purchasers of securities take physical
delivery of such securities. Such limits and such laws may impair the
ability to transfer beneficial interests in the New Preferred Stock or
the New Bonds.
Upon receipt of any payment of the redemption price or dividends in
respect to the New Preferred Stock or any payment of principal, premium
or interest in respect of the New Bonds, DTC's current practice is to
credit immediately Participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the par value
of such New Preferred Stock or the principal amount of such New Bonds as
shown on the records of DTC. Payments by Participants to owners of
beneficial interests in the New Preferred Stock or the New Bonds will be
governed by standing instructions and customary practices, as is
now the case with securities held for the accounts of customers in bearer
form or registered in 'street name,' and will be the responsibility of
such Participants, subject to any statutory or regulatory requirements
that may be in effect from time to time. Conveyance of notices and other
communications by DTC to Participants and by Participants to other
beneficial owners will be governed by arrangements among them, subject to
any statutory and regulatory requirements as may be in effect from time
to time.
Each purchaser of New Preferred Stock or New Bonds must rely on (1)
the procedures of DTC, and, if such purchaser is not a Participant, the
procedures of the Participant through which such purchaser holds its
beneficial interest, to receive payments and notices, and (2) the records
of DTC and, if such purchaser is not a Participant, the records of the
Participant through which such purchaser holds its beneficial interest,
to evidence its beneficial ownership of New Preferred Stock or New Bonds.
DTC is a limited-purpose trust company organized under the New York
Banking Law, a 'banking organization' within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a 'clearing
corporation' within the meaning of the New York Uniform Commerical Code,
and a 'clearing agency' registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934. DTC holds securities of its
Participants and facilitates the clearance and settlement of securities
transactions among its Participants in such securities through electronic
book-entry changes in accounts of the Participants, thereby eliminating
the need for physical movement of securities certificates. DTC's
Participants include securities brokers and dealers (including any
Underwriter of the New Preferred Stock or New Bonds), banks, trust
companies, clearing corporations, and certain other organizations, some
of whom (and/or their representatives) own DTC. Access to DTC's
book-entry system is also available to others, such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly. The rules
applicable to DTC and its Participants are on file with the Securities
and Exchange Commission.
The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources (including DTC) that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
Neither the Company, the Transfer Agent and Registrar, the Trustees,
any Underwriter nor any agent for payment on or registration of transfer
or exchange of such New Preferred Stock or New Bonds will have any
responsibility or liability for any of the records relating to or
payments made on account of beneficial interests in any of the New
Preferred Stock or the New Bonds or for maintaining, supervising or
reviewing any records relating to such beneficial interests.