As filed with the Securities and Exchange Commission on August 25, 2003
Registration No. 333-_________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
INTERSTATE POWER AND LIGHT COMPANY
(Exact name of registrant as specified in its charter)
Iowa
(State or other jurisdiction 42-0331370
of incorporation or organization) I.R.S. Employer Identification No.)
Alliant Energy Tower
200 First Street, SE
Cedar Rapids, Iowa 52401
(319) 786-4411
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
_____________________________________
F. J. Buri, Esq.
Corporate Secretary
Interstate Power and Light Company
4902 North Biltmore Lane
Madison, Wisconsin 53718
(608) 458-3311
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
_____________________________________
with a copy to:
Benjamin F. Garmer, III, Esq.
Jay O. Rothman, Esq. Barbara L. Becker, Esq.
Foley & Lardner Gibson, Dunn & Crutcher LLP
777 East Wisconsin Avenue 200 Park Avenue
Milwaukee, Wisconsin 53202 New York, New York 10166
(414) 271-2400 (212) 351-4035
_____________________________________
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. |_|
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
==================================================================================================================================
Title of each class of Amount to be Proposed maximum offering Proposed maximum aggregate Amount of
securities to be registered registered price per unit (1) offering price (1) registration fee
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Senior debentures $100,000,000 100% $100,000,000 $8,090
==================================================================================================================================
(1)Estimated in accordance with Rule 457(o) under the Securities Act of
1933, as amended, solely for purposes 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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
The information in this prospectus is not complete and may be changed. This
prospectus is not an offer to sell these securities and is not soliciting offers
to buy these securities in any jurisdiction where the offer or sale is not
permitted.
Subject to Completion
Preliminary Prospectus dated August 25, 2003
PROSPECTUS
- ----------
$100,000,000
Interstate Power and Light Company
% Senior Debentures due 2018
__________________
We will pay interest on the senior debentures on _____________ and
__________ of each year, beginning on __________, ______. The senior debentures
will mature on ____________, 2018. We may redeem some or all of the senior
debentures at any time at the redemption prices described in this prospectus.
The senior debentures will be unsecured obligations and rank equally with
our unsecured senior indebtedness. The senior debentures will be issued only in
registered form in denominations of $1,000.
Per Senior Total
Debenture
--------------- --------------
Public offering price........................................ % $
Underwriting discount........................................ % $
Proceeds, before expenses, to Interstate Power and Light
Company.................................................. % $
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The senior debentures will be ready for delivery in book-entry form only
through The Depository Trust Company on or about ________________, 2003.
__________________
Merrill Lynch & Co. Barclays Capital
__________________
The date of this prospectus is ____________, 2003
TABLE OF CONTENTS
Page
Forward-Looking Statements...................................................ii
Prospectus Summary............................................................1
Use of Proceeds...............................................................5
Capitalization................................................................5
The Company...................................................................6
Description of Senior Debentures..............................................9
Underwriting.................................................................18
Where You Can Find More Information..........................................20
Legal Matters................................................................20
Experts ....................................................................20
__________________
You should rely only on the information contained or incorporated by
reference in this prospectus. We have not, and the underwriters have not,
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not, and the underwriters are not, making an offer to sell these
securities in any jurisdiction where the offer or sale is not permitted. You
should assume that the information appearing in this prospectus and the
documents incorporated by reference is accurate only as of respective dates of
those documents in which the information is contained. Our business, financial
condition, results of operations and prospects may have changed since those
dates.
Unless we otherwise indicate or unless the context requires otherwise, all
references in this prospectus to "we," "our," "us" or similar references mean
Interstate Power and Light Company.
Our principal executive offices are located at Alliant Energy Tower, 200
First Street, SE, Cedar Rapids, Iowa 52401, and our telephone number is (319)
786-4411.
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FORWARD-LOOKING STATEMENTS
This prospectus and the information we incorporate by reference into this
prospectus contain forward-looking statements that are intended to qualify for
the safe harbors from liability established by the Private Securities Litigation
Reform Act of 1995. All statements other than statements of historical fact,
including statements regarding anticipated financial performance, business
strategy and management's plans and objectives for future operations, are
forward-looking statements. These forward-looking statements can be identified
as such because the statements generally include words such as "expect,"
"intend," "believe," "anticipate," "estimate," "plan" or "objective" or other
similar expressions. These forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
expressed in, or implied by, these statements. Some, but not all, of the risks
and uncertainties include the following:
o weather effects on sales and revenues;
o economic and political conditions in our service territories;
o federal and state regulatory or governmental actions, including the
ability to obtain adequate and timely rate relief to allow for, among
other things, the recovery of operating costs and the earning of
reasonable rates of return and any costs or regulations associated
with federal or state actions directed at transmission or reliability;
o unanticipated construction and acquisition expenditures;
o issues related to the supply of purchased electricity and its price,
including the ability to recover purchased-power and fuel costs
through rates;
o risks related to the operation of our nuclear facility;
o costs associated with our environmental remediation efforts and with
environmental compliance generally;
o developments that adversely impact our ability to implement our
strategic objectives;
o continued access to the capital markets;
o our ability to continue cost controls and operational efficiencies;
o our ability to identify and successfully complete proposed development
projects;
o access to technological developments;
o employee workforce factors, including changes in key executives,
collective bargaining agreements or work stoppages; and
o changes in the rate of inflation.
We assume no obligation, and disclaim any duty, to update these
forward-looking statements.
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PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in this prospectus.
This summary may not contain all of the information that may be important to
you. You should read the entire prospectus carefully before making a decision to
invest in our senior debentures.
Our Company
We are a regulated utility serving customers in Iowa, Minnesota and
Illinois. We are engaged principally in the generation, transmission,
distribution and sale of electric energy; the purchase, distribution,
transportation and sale of natural gas; and the delivery of steam services in
selected markets. As of December 31, 2002, we served approximately 526,000
electric customers in 760 communities and approximately 235,000 gas customers in
253 communities. All of our common stock is owned by Alliant Energy Corporation,
an energy-services provider engaged primarily in regulated utility operations in
the Midwest, including through our company, and with other non-regulated
domestic and international operations.
We are subject to the jurisdiction of the Iowa Utilities Board, or IUB, the
Minnesota Public Utilities Commission, or MPUC, and the Illinois Commerce
Commission, or ICC, with respect to various portions of our operations. We are
also subject to the jurisdiction of the Federal Energy Regulatory Commission and
the Nuclear Regulatory Commission, or NRC. Our parent company, Alliant Energy
Corporation, is a registered public utility holding company subject to
regulation by the Securities and Exchange Commission, or SEC, under the Public
Utility Holding Company Act of 1935. We are also subject to some requirements of
that Act.
Rate Case Developments
Iowa Electric Rate Case Final Order
On April 15, 2003, we received the final order in our retail electric rate
case from the IUB. The IUB granted a $26 million, or 2.91%, annual revenue
increase and authorized a return on common equity of 11.15% effective May 28,
2003. The compliance tarriffs were effective on August 22, 2003. Since the final
increase approved by the IUB is lower than the $17 million interim relief
granted in October 2002, a refund plan was filed with the IUB in July 2003. We
are reserving all amounts related to the anticipated refund.
Iowa Gas Rate Case Final Order
On May 15, 2003, we received the final order in our retail gas rate case
from the IUB. The IUB granted a $13 million, or 4.8%, annual revenue increase
and authorized a return on common equity of 11.05%. We expect this final order
to be effective in August 2003.
Minnesota Electric Rate Case
On May 19, 2003, we filed a rate request with the MPUC for approval to
increase electric base rates by approximately $5.0 million, or 8.0%, with a rate
of return on common equity of 12.3%. On July 18, 2003, the MPUC granted us
approval to increase rates on an interim basis by approximately $1.9 million, or
3.1%, which is approximately 66% of the $2.9 million of interim relief
requested. The rate of return on common equity was set at 11.0%. The interim
rates became effective on July 18, 2003. We expect final rates to be effective
in April 2004.
Credit Facility Borrowings and Availability
The following table sets forth our bank credit facility borrowing and
availability as of July 31, 2003:
Total facility........................ $200,000,000
Borrowing backed by facility.......... 38,000,000
----------------
Availability.......................... $162,000,000
================
Our bank credit facility expires in October 2003. While we anticipate renewing
the credit facility in the third quarter of 2003, we cannot provide complete
assurance that we will be able to do so.
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The Offering
The following is a brief summary of some of the terms of this offering. For
a more complete description of the terms of the senior debentures, see
"Description of the Senior Debentures" in this prospectus.
Issuer............................................... Interstate Power and Light Company
Senior debentures offered............................ $100,000,000 aggregate principal amount of ___% senior
debentures due 2018.
Maturity............................................. __________, 2018.
Interest payment dates............................... _______________ and ___________ of each year, beginning
________, ____.
Ranking.............................................. The senior debentures will be unsecured and rank equally
with our unsecured senior indebtedness. The senior
debentures will also be subordinated to our secured
indebtedness as to the assets securing such indebtedness.
As of June 30, 2003, giving pro forma effect to this
offering and our use of the net proceeds, we would have had
outstanding $353.4 million of secured indebtedness.
Ratings.............................................. Standard & Poor's Ratings Service has assigned our existing
senior unsecured long-term indebtedness a rating of BBB.
Moody's Investors Service, Inc. has assigned our existing
senior unsecured long-term indebtedness a rating of Baa1.
We have applied for ratings for the senior debentures.
Ratings are not a recommendation to buy, sell or hold the
senior debentures. We cannot give any assurance that the
ratings will be retained for any time period or that they
will not be revised downward or withdrawn by the ratings
agencies.
Optional redemption.................................. We may redeem some or all of the senior debentures at any
time at a redemption price equal to the sum of the
principal amount of the senior debentures we redeem,
accrued interest on that principal amount to the redemption
date and the make-whole amount, if any, with respect to
those senior debentures. See "Description of Senior
Debentures - Redemption Prior to Maturity."
Covenants............................................ The indenture governing the senior debentures contains
covenants that, among other things, limit our ability to:
o create some types of secured indebtedness; and
o consolidate or merge.
These covenants are subject to important exceptions and
qualifications, which are described under the heading
"Description of the Senior Debentures" in this prospectus.
No limitation on debt................................ The indenture governing the senior debentures does not
limit the amount of senior debentures that we may issue or
provide holders any protections should we be involved in a
highly leveraged transaction.
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Use of proceeds...................................... We estimate that the net proceeds from the offering will be
approximately $99.0 million. We intend to use the proceeds
from this offering to repay long-term debt.
Denomination......................................... The senior debentures will be issued in integral multiples
of $1,000.
Absence of market for the senior debentures.......... The senior debentures are a new issue of securities with no
established trading market. We currently have no intention
to apply to list the senior debenture on any securities
exchange or to seek their admission to trading on any
automated quotation system. Accordingly, we cannot provide
any assurance as to the development or liquidity of any
market for the senior debentures. See "Underwriting."
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Summary Financial Information
The summary consolidated financial information below was selected or
derived from our consolidated financial statements. The unaudited interim period
financial information, in our opinion, includes all adjustments, which are
normal and recurring in nature, necessary for a fair presentation for the
periods shown. Results for the six months ended June 30, 2003 are not
necessarily indicative of results to be expected for the full fiscal year. The
information set forth below is qualified in its entirety by and should be read
in conjunction with our Management's Discussion and Analysis of Financial
Condition and Results of Operations and our consolidated financial statements
and related notes incorporated by reference into this prospectus. See "Where You
Can Find More Information."
Six Months Ended
Year Ended December 31, June 30,
--------------------------------------- ------------------------
2000 2001 2002 2002 2003
---------- ---------- ---------- ---------- ---------
(In thousands)
Income Statement Data:
Operating revenues.......................... $1,234,007 $1,316,250 $1,211,608 $ 548,073 $ 650,133
Operating income............................ 224,615 199,414 206,111 72,316 82,254
Net income.................................. 103,127 98,066 90,877 28,676 32,829
Earnings available for common stock......... 99,724 94,656 88,015 26,968 26,359
As of December 31,
----------------------------------- As of
2001 2002 June 30, 2003
---------------- --------------- -------------------
(In thousands)
Balance Sheet Data:
Current assets................................... $ 153,870 $ 272,867 $ 226,435
Property, plant and equipment, net............... 1,973,716 2,086,590 2,437,035
Investments and other non-current assets......... 298,728 378,949 428,110
Current liabilities.............................. 246,553 261,297 421,492
Long-term debt (excludes current portion)........ 832,068 827,389 827,409
Other non-current liabilities.................... 471,744 637,951 847,798
Ratios of Earnings to Fixed Charges
The following table sets forth our ratios of earnings to fixed charges for
the periods presented:
Six Months Ended
Year Ended December 31, June 30,
- ---------------------------------------------- -----------------
1998 1999 2000 2001 2002 2002 2003
- -------- ---------- -------- -------- -------- -------- --------
2.86 3.33 3.31 3.07 3.13 2.29 2.51
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USE OF PROCEEDS
We estimate that we will receive net proceeds from this offering of
approximately $99.0 million, after deducting the underwriting discount and
commissions and estimated offering expenses payable by us. We intend to use the
net proceeds from this offering to redeem the following long-term debt after the
completion of this offering:
o $27,450,000 aggregate principal amount of our first mortgage bonds, 7.25%
Series due 2007;
o $20,000,000 aggregate principal amount of our first mortgage bonds, 8.625%
Series due 2021; and
o $50,000,000 aggregate principal amount of our 7.875% quarterly debt capital
securities due 2025.
CAPITALIZATION
The following table sets forth our consolidated capitalization as of June
30, 2003 on an actual basis and as adjusted to give effect to this offering and
the anticipated use of the net proceeds from the offering as described under
"Use of Proceeds."
As of June 30, 2003
-----------------------------------------------------------------
Actual As Adjusted % of Total As
Adjusted
-------------------- ------------------- ------------------
(In thousands)
Common stock................................. $ 33,427 $
Additional paid-in capital................... 477,542
Retained earnings............................ 357,699
Accumulated other comprehensive loss......... (18,887)
-------------- --------------
Total common equity..................... 849,781
Cumulative preferred stock................... 145,100
Long-term debt (excluding current portion)... 827,409
Short-term debt.............................. 158,300
-------------- -------------- ------
Total capitalization (including short-term
debt)................................ $ 1,980,590 $ 100.0%
============== ============== ======
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THE COMPANY
We are a regulated utility serving customers in Iowa, Minnesota and
Illinois. We are engaged principally in the generation, transmission,
distribution and sale of electric energy; the purchase, distribution,
transportation and sale of natural gas; and the delivery of steam services in
selected markets. As of December 31, 2002, we served approximately 526,000
electric customers in 760 communities and approximately 235,000 gas customers in
253 communities. All of our common stock is owned by Alliant Energy Corporation,
an energy-services provider engaged primarily in regulated utility operations in
the Midwest, including through our company, and with other non-regulated
domestic and international operations.
Competitive Strengths
We believe that our competitive strengths include the following:
Successful Rate Cases: We have recently received favorable outcomes from
the rate cases we filed in Iowa. The IUB approved an annual electric rate
increase of $26 million for us, an increase of 2.9% over current rates, and
authorized a return on common equity of 11.15%. The IUB also approved an annual
gas rate increase of $13 million for us, an increase of 4.8% over current rates,
and authorized a return on common equity of 11.05%. In addition, on July 18,
2003, the MPUC granted us approval to increase rates in Minnesota on an interim
basis by approximately $1.9 million, or 3.1%, and authorized a return on common
equity of 11.0%.
Substantial Opportunities to Invest in Our Operations: The Iowa legislature
passed a bill in 2001 to encourage construction of new generating facilities in
Iowa through House File 577. This legislation eased siting requirements and gave
the IUB authority to authorize upfront rate making principles for certain new
generating facilities built in Iowa. We plan, subject to market conditions and
favorable regulatory treatment, to develop up to 1,200 megawatts of new electric
generation over the next 10 years. Currently, our Power Iowa plan includes
adding approximately 550 megawatts of natural gas-fired generation by 2004; 100
megawatts of capacity generated from renewable energy sources by December 2003;
researching options for an additional 500-600 megawatts of generation; and
increases in energy efficiency through energy conservation and process
improvements at various commercial and industrial customer locations. In January
2003, the IUB approved our siting certificate for an approximately 550-megawatt
natural gas-fired plant in Clear Lake and construction began shortly thereafter.
We will receive a regulatory rate of return of 12.23% on the equity component
for 27.6 years with respect to this plant. This plant is scheduled to be in
service prior to the 2004 summer peak.
Operate Our Transmission and Distribution Businesses to High Standards of
Customer Service and Reliability. We have over 78 years of experience in
operating and managing rate-regulated electric and gas transmission and
distribution businesses and we use this experience to seek to achieve high
standards of customer service and reliability in a cost-effective manner.
Strategy
Our strategic objectives are:
o To increase our megawatt capacity through investment in new electric
power generation, subject to appropriate regulatory incentives;
o To increase plant availability and reduce the cost of energy
production;
o To enhance service reliability and operational excellence;
o To maintain excellent customer service;
o To maintain favorable regulatory relationships;
o To remain current with cutting-edge technologies that impact our
business;
o To practice proactive environmental compliance; and
o To continue to deliver strong operating results.
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Operations
During 2002, we had total operating revenues of approximately $1,211.6
million, which included $964.9 million in electric revenues, or 80% of revenues,
$214.9 million in gas revenues, or 18% of revenues, and $31.8 million in steam
revenues, or 2% of revenues. No single customer accounted for more than 10% of
our consolidated revenues in 2002. Our electric and gas revenues for 2002, sales
for 2002 and customers as of December 31, 2002 consisted of the following:
Electric
---------------------------------------------------------------------------------------
Revenues % Sales % Customers %
--------------- -------- --------------- --------- ------------ -------
(Thousands) (Thousands of
megawatt-hours)
Residential.... $355,072 36.8% 4,184 25.1% 446,202 84.8%
Commercial..... 229,639 23.8% 3,392 20.3% 76,856 14.6%
Industrial..... 315,494 32.7% 7,843 47.0% 1,898 0.3%
Other.......... 64,649 6.7% 1,254 7.6% 1,328 0.3%
--------------- -------- --------------- --------- ------------ -------
Total.......... $964,854 100.0% 16,673 100.0% 526,284 100.0%
=============== ======== =============== ========= ============ =======
Gas
---------------------------------------------------------------------------------------
Revenues % Sales % Customers %
--------------- -------- --------------- --------- ------------ --------
(Thousands) (Thousands of
dekatherms)
Residential.... $124,237 57.8% 18,068 29.3% 206,808 88.0%
Commercial..... 61,222 28.5% 10,774 17.4% 27,607 11.8%
Industrial..... 18,197 8.5% 4,070 6.6% 438 0.2%
Other.......... 11,239 5.2% 28,814 46.7% N/A N/A
--------------- -------- --------------- --------- ------------ --------
Total.......... $214,895 100.0% 61,726 100.0% 234,853 100.0%
=============== ======== =============== ========= ============ ========
Electric Operations. In 2002, we had a maximum peak hour demand of 3,097
megawatts in the month of July. During 2002, our sources of generation included
57% coal, 23% purchased-power, 18% nuclear and 2% gas/other.
As of December 31, 2002, we owned and operated 7,068 miles of electric
transmission lines and 801 substation facilities connecting with its high
voltage transmission systems. See "--Transmission Assets." A non-cancelable
operating agreement, which extends through December 31, 2035, provides for the
joint use of certain transmission facilities of ours and Central Iowa Power
Cooperative.
Gas Operations. At December 31, 2002, we served approximately 235,000
customers. The gas utility operations accounted for 18% of our operating
revenues for the year ended December 31, 2002.
Steam Operations. Steam operations in Cedar Rapids, Iowa, represented about
2% of our revenues for the year ended December 31, 2002.
Construction Program. Our construction expenditures for 2002 were
approximately $248 million. Anticipated construction expenditures are
approximately $450 million for 2003 (excluding approximately $109 million for
the purchase of turbines and related equipment from affiliates and including
$220 million for the Power Iowa plan), and $640 million for 2004 through 2005
(including $80 million for the Power Iowa plan).
Transmission Assets
In 2001, we and five other electric utilities filed an application with the
Federal Energy Regulatory Commission to create TRANSLink Transmission Co. LLC, a
for-profit, transmission-only company. In April 2002, the Federal Energy
Regulatory Commission conditionally approved TRANSLink's formation and
TRANSLink's participation in the Midwest Independent System Operator. In June
2002, TRANSLink Development Co. LLC was formed to oversee the start-up
activities for TRANSLink. Since June 2002, six additional electric utilities
joined TRANSLink. In June 2003, the IUB dismissed, without prejudice, our plan
to contribute and transfer transmission
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assets of 69 kilovolts and greater to TRANSLink. The IUB encouraged
participating companies to revise and re-file their reorganization applications.
We are currently evaluating our options with respect to TRANSLink.
Nuclear Management Company
We own a 70% interest in Duane Arnold Energy Center, a 580-megawatt (net
capacity) nuclear plant, which is operated by the Nuclear Management Company,
LLC under contract to us. The Duane Arnold operating license expires in 2014.
The Nuclear Management Company was formed in 1999 to consolidate the
operation of its owners' nuclear plants and to provide similar capabilities for
other nuclear operators and owners. Combined, the Nuclear Management Company
operates eight nuclear generating units at six sites. Our parent, Alliant Energy
Corporation, through its direct, non-utility subsidiary, Alliant Energy Nuclear
LLC, owns 20% of Nuclear Management Company. Similar to others involved with the
Nuclear Management Company, we continue to own our respective plant and are
entitled to the energy generated at this plant. Each partner in the Nuclear
Management Company retains the financial obligations for the safe operation,
maintenance and the decommissioning of its plants.
Rates and Regulatory Environment
A significant portion of our operations are under the jurisdiction of the
IUB. Requests for rate relief are based on historical test periods, adjusted for
some known and measurable changes. Our retail tariffs provide for subsequent
adjustments to our electric and natural gas rates for changes in the cost of
fuel, purchased energy and natural gas purchased for resale. Purchased-power
capacity costs are not recovered from electric customers through this energy
adjustment clause mechanism. Recovery of these capacity costs must be addressed
in formal rate proceedings.
We are also subject to regulation by the MPUC and the ICC with respect to
our operations and our rates in Minnesota and Illinois, respectively.
We are currently addressing the recovery of our utility cost increases
through several rate filings. Our recent rate cases are summarized as follows
(dollars in millions):
Case Expected
Final Final Final Return
Utility Filing Increase Increase Effective Effective on
Case Type Date Requested Granted Date Date Equity
- --------------------- --------- --------- ----------- ---------- ---------- ---------- --------
Retail--IA......... Electric 3/02 $ 82 $ 26 5/03 N/A 11.15%
Retail--IA(1)...... Gas 7/02 20 13 8/03 N/A 11.05%
Retail--MN......... Electric 5/03 5 * * 4/04 *
----------- ----------
Total............. $107 $ 39
=========== ==========
* To be determined.
(1) Since the final increase approved by the IUB is lower than the $17 million
interim relief granted in October 2002, a refund plan was filed with the
IUB in July 2003. We are reserving all amounts related to the anticipated
refund.
The Federal Energy Regulatory Commission has jurisdiction under the Federal
Power Act over some of our electric utility facilities and operations, wholesale
rates and accounting practices, and in some other respects.
Our parent, Alliant Energy Corporation, operates as a registered public
utility holding company subject to regulation by the SEC under the Public
Utility Company Holding Act. As a result, we are subject to some of the
regulatory provisions of the Public Utility Company Holding Act, including
provisions relating to the issuance and sales of securities, acquisitions and
sales of some utility properties and acquisition and retention of interests in
non-utility businesses.
We are indirectly and directly subject to the jurisdiction of the NRC with
respect to the Duane Arnold Energy Center and to the jurisdiction of the U.S.
Department of Energy with respect to the disposal of nuclear fuel
-8-
and other radioactive wastes from such plants. The NRC has broad supervisory and
regulatory jurisdiction over the construction and operation of nuclear reactors,
particularly with regard to public health, safety and environmental
considerations. The operation and design of nuclear power plants is under
constant review by the NRC.
DESCRIPTION OF SENIOR DEBENTURES
We will issue the senior debentures as a separate series of securities
under the indenture, dated as of August 20, 2003, between us and Bank One Trust
Company, National Association, as trustee, or Bank One Trust.
This section summarizes the indenture. Since this is only a summary, it
does not contain all of the information that may be important to you. The
summary is subject to and qualified in its entirety by reference to the
indenture which is filed as an exhibit to the registration statement of which
this prospectus is a part and incorporated by reference into this prospectus.
See "Where You Can Find More Information." Parenthetical section references
under this heading are references to sections of the indenture.
General
The indenture does not limit the aggregate principal amount of senior
unsecured debt securities that we can issue under it, and provides that we may
issue securities from time to time in one or more series pursuant to the terms
of one or more supplemental indentures, board resolutions or officers'
certificates creating the series. The indenture also does not limit the total
amount of debt that we can incur under other instrument, including first
mortgage bonds. It also does not give holders of the senior debentures
protection in the event we engage in a highly leveraged or other transaction
that may adversely affect holders of the senior debentures. As of the date of
this prospectus, we have no senior debentures outstanding under the indenture.
This section summarizes the indenture. Since this is only a summary, it
does not contain all of the information that may be important to you. The
summary is subject to and qualified in its entirety by reference to the
indenture which is filed as an exhibit to the registration statement of which
this prospectus is a part and incorporated by reference into this prospectus.
See "Where You Can Find More Information." Parenthetical section references
under this heading are references to sections of the indenture.
Maturity and Interest
We are offering the senior debentures in the aggregate principal amount of
$100 million. The senior debentures will mature on __________, 2018. Each senior
debenture will bear interest from __________, 2003, or from and including the
most recent interest payment date to which we have paid interest, at the rate of
____% per year. We will pay interest twice per year, on ______ and ______,
commencing __________, _____, to the persons in whose names the senior
debentures are registered at the close of business (1) on the business day prior
to each interest payment date if the senior debentures remain in book-entry only
form or (2) on the fifteenth calendar day before each interest payment date if
the senior debentures do not remain in book-entry only form.
Ranking
The senior debentures will be our senior, unsecured and unsubordinated
obligations, ranking equally and ratably with all our other senior, unsecured
and unsubordinated obligations. The senior debentures will be effectively
subordinated to all of our existing and future secured indebtedness.
We currently have first mortgage bonds, collateral trust bonds and
unsecured long-term debt outstanding. Substantially all of our tangible public
utility property is subject to direct first mortgage liens under our indentures
and deeds of trust securing our first mortgage bonds. Our indentures and deeds
of trust securing our collateral trust bonds are direct second liens on a
significant portion of of our tangible public utility property while some of our
first mortgage bonds remain outstanding. If we become bankrupt, liquidate or
reorganize, the trustees for the first mortgage bonds and collateral trust bonds
could use the collateral property to satisfy our obligations under the first
mortgage bonds and collateral trust bonds before holders of unsecured debt
securities, including the senior debentures, would receive any payments.
-9-
As of June 30, 2003, giving pro forma effect to this offering and our use
of the net proceeds, we would have had $119.0 million aggregate principal amount
of first mortgage bonds, $234.4 million aggregate principal amount of collateral
trust bonds and $483.3 million aggregate principal amount in unsecured long-term
debt outstanding.
Redemption Prior to Maturity
We may redeem the senior debentures at any time at our option, in whole
or in part, at a redemption price equal to the sum of the principal amount of
the senior debentures we redeem, accrued interest on that principal amount to
the redemption date and the make-whole amount, if any, with respect to those
senior debentures. (Officers' Certificate). This sum is referred to as the
redemption price.
"Make-whole amount" means, in connection with the optional redemption, the
excess, if any, of:
o the aggregate present value as of the date of any optional redemption
of each dollar of principal being redeemed and the amount of interest,
exclusive of interest accrued to the date of redemption, that would
have been payable in respect of such dollar of principal if such
redemption had not been made, determined by discounting, on a
semi-annual basis, such principal and interest at the reinvestment
rate, as determined on the third business day preceding the date that
notice of the redemption is given, from the respective dates on which
such principal and interest would have been payable if such redemption
had not been made, over
o the aggregate principal amount of the senior debentures being
redeemed.
"Reinvestment rate" means ___% plus the arithmetic mean of the yields under
the headings "Week Ending" published in the most recent statistical release
under the caption "Treasury Constant Maturities" for the maturity, rounded to
the nearest month, corresponding to the remaining life to maturity, as of the
payment date of the principal being redeemed. If no maturity exactly corresponds
to such maturity, yields for the two published maturities most closely
corresponding to such maturity will be calculated pursuant to the immediately
preceding sentence and the reinvestment rate will be interpolated or
extrapolated from such yields on a straight-line basis, rounding in each of the
relevant periods to the nearest month. For purposes of calculating the
reinvestment rate, the most recent statistical release published prior to the
date of determination of the make-whole amount will be used.
"Statistical release" means the statistical release designated "H.15(519)"
or any successor publication which is published weekly by the Federal Reserve
System and which establishes yields on actively traded United States government
securities adjusted to constant maturities or, if such statistical release is
not published at the time of any determination, then such other reasonably
comparable index which shall be designated by us.
No sinking fund will be established for the benefit of the senior
debentures.
Payments
We will pay principal of, and premium, if any, and interest on, the senior
debentures at the office or agency we maintain for that purpose, initially the
corporate trust office of the trustee. Bank One Trust is the initial paying
agent designated for the senior debentures. We may designate additional paying
agents, rescind the designation of any paying agent or approve a change in the
office through which any paying agent acts, but we must maintain a paying agent
in each place where payments on the senior debentures are payable. (Sections
301, 307 and 602).
Purchase and Cancellation
We may at any time purchase senior debentures in the open market or
otherwise at any price, subject to applicable U.S. securities laws. Any senior
debentures so purchased must be promptly surrendered to the trustee for
cancellation. (Section 309).
-10-
Restrictive Covenants
Except as otherwise set forth under "-- Defeasance" below, for so long as
any senior debentures remain outstanding or any amount remains unpaid on any of
the senior debentures, we will comply with the terms of the covenants set forth
below. If we issue additional series of securities under the indenture in the
future, then those series may or may not have different covenants.
Limitations on Liens
The indenture provides generally that we will not, and we will not permit
any of our subsidiaries to, create or allow to be created or to exist any lien
on any of our properties or assets to secure any indebtedness, without making
effective a provision that makes the senior debentures to which this limitation
applies equally and ratably secured with or prior to all such indebtedness and
with any other indebtedness that is also entitled to be equally secured. This
restriction does not apply to or prevent the creation or existence of:
o liens securing our first mortgage bonds and collateral trust bonds issued
under:
o our indenture and deed of trust, dated as of February 1, 1923, with
Bank One Trust, as successor trustee, as amended and supplemented from
time to time;
o our indenture of mortgage and deed of trust, dated as of August 1,
1940, with Bank One Trust, as successor trustee, as amended and
supplemented from time to time;
o our indenture, dated as of January 1, 1948, with JPMorgan Chase Bank,
as trustee, as amended and supplemented from time to time; and
o liens under our indenture of mortgage and deed of trust, dated as of
September 1, 1993, with Bank One Trust, as successor trustee, as
amended and supplemented from time to time;
o liens on property that existed when we acquired or constructed the property
or were created within one year after that time;
o liens on property that secure payment of all or part of the purchase price
or construction cost of the property, including the extension of any liens
to repairs or improvements made on the property;
o the pledge of any bonds or other securities at any time issued under any of
the liens permitted by the above-listed items;
o tax liens and other governmental charges which are not delinquent or which
can be paid without penalty or which are being contested;
o liens incurred in the ordinary course of business for charges that are not
delinquent or that are being contested, including mechanics', workmen's,
repairmen's, materialmen's, warehousemen's and carriers' liens and liens
securing workers' compensation and other employee awards;
o liens in respect of judgments or awards with respect to which we have the
right to prosecute an appeal or other proceeding for review;
o easements, reservations, regulations and rights of others in, and defects
of title in, some of our property;
o any defects or irregularities in title to any rights-of-way and/or to any
real estate used or to be used for right-of-way purposes or held under
lease, easement, license or similar right;
o liens securing indebtedness neither created, assumed nor guaranteed by us
nor on account of which we customarily pay interest;
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o some leasehold interests;
o any controls, restrictions, obligations or other burdens imposed by any
law, rule or regulation of any governmental authority on any of our
property or the operation or use of any of our property;
o liens on our pollution control and sewage and solid waste disposal
facilities incurred in connection with the issuance of industrial
development revenue bonds;
o any right which any governmental authority may have by virtue of any
franchise, license, contract or statute to purchase any of our property on
payment of reasonable compensation, or to terminate any franchise, license
or other rights or to regulate our property and business;
o any liens that have been bonded for the full amount in dispute;
o prepaid liens;
o liens resulting from good faith deposits made in connection with bids,
tenders, contracts or leases to which we are a party, and liens resulting
from deposits made to secure our public or statutory obligations;
o the pledge or assignment in the ordinary course of business of electricity,
gas or steam accounts receivable or customers' installment paper;
o rights reserved to or vested in others to take or receive any part of the
electricity, gas, steam or any by-products generated or produced by any of
our properties;
o any landlord's lien;
o any lien of the trustee for payment for services, reasonable expenses,
disbursements and advances, or for indemnification payments; and
o liens not otherwise permitted if, at the time we incur the lien and after
giving effect to the lien, the aggregate of all obligations secured by the
lien does not exceed 10% of our tangible net worth, as defined in the
indenture.
This restriction will not apply to or prevent the creation or existence of
leases we enter into, or on existing property we acquire, in the ordinary course
of our business. (Section 608).
Consolidation, Merger and Sale of Assets
The indenture provides that we will not consolidate with or merge into any
other corporation, or sell all or substantially all of our assets to any other
person unless:
o the continuing corporation or the purchasers of assets, as the case may be,
will be an entity organized and existing under the laws of the United
States, any state of the United States or the District of Columbia, and the
entity will expressly assume the payment of the principal of, and premium,
if any, or interest on, the debt securities outstanding and the performance
and observance of all of our covenants and conditions under the indenture
by executing a supplemental indenture satisfactory to the trustee; and
o after giving effect to the transaction, no event which, after notice or
lapse of time, would become a default under the indenture, will have
occurred or be continuing. (Section 1101).
The indenture further provides that our successor will be substituted for
us, after which all of our obligations under the indenture will terminate.
(Section 1102).
-12-
Events of Default
Each of the following will be an event of default with respect to the
senior debentures:
o failure to pay interest on the senior debentures within 60 days after a due
date;
o failure to pay principal of, or premium, if any, on the senior debentures
within 10 days after a due date;
o failure to perform or satisfy any of our other covenants or warranties in
the indenture, which failure continues for 60 days after we receive notice
of the failure from the trustee or the holders of at least 33% in principal
amount of the senior debentures;
o specified events relating to our bankruptcy, insolvency or reorganization.
(Section 801).
If an event of default occurs and continues, then either the trustee or the
holders of at least 33% in principal amount of the outstanding senior debentures
in default may declare the principal amount of the senior debentures immediately
due and payable. (Section 802).
The trustee can require that it be indemnified before it enforces the
indenture or any outstanding senior debentures. (Section 903). Subject to some
limitations, holders of a majority in principal amount of the outstanding senior
debentures can direct the trustee in its exercise of any trust or power.
(Section 812). The trustee does not have to give holders notice of any
continuing default, except a default in payment of principal or interest, if it
in good faith determines that withholding notice is in the interests of the
holders. (Section 902). We are required to give the trustee a certificate
certifying as to our compliance with all conditions and covenants under the
indenture at least once a year. (Section 606).
Modification of the Indenture
The holders of at least a majority in principal amount of outstanding
senior debentures may waive, subject to the limitations described below, any
existing default and its consequences under the indenture. These holders cannot,
however, waive a default in the payment of the principal of, or premium, if any,
or interest on, any senior debentures or a default in respect of a provision we
describe in the following paragraph. (Section 813). These defaults cannot be
waived without the consent of each holder of the outstanding senior debentures.
With the consent of the holders of at least a majority in aggregate
principal amount of outstanding senior debentures, we and the trustee can enter
into supplemental indentures to amend or modify the indenture. However, we
cannot make modifications or amendments without the consent of all of the
holders of the outstanding senior debentures if the amendments or modifications
would:
o change the stated maturity, reduce the principal amount of, or reduce the
rate of interest on, the senior debentures;
o change the coin or currency or the property in which we must pay principal
of, or premium, if any, or interest on, the senior debentures;
o impair the right to institute suit for the enforcement of any payment of
principal of, or premium or interest on, the senior debentures after the
due date of the payment;
o reduce the percentage in principal amount of the outstanding senior
debentures, the consent of which is required to enter into any supplemental
indenture;
o reduce the amount of senior debentures whose holders must consent to an
amendment or waiver of the provisions of the indenture; or
-13-
o make modifications to any of the provisions we describe in this paragraph
and in the paragraph immediately above. (Section 1202).
We cannot enter into supplemental indentures to amend or modify the
indenture in ways that affect other series of debt securities under the
indenture without the consent of the holders of at least a majority in aggregate
principal amount of all securities issued under the indenture that will be
affected by the amendment, voting together as one class. Further, if any
amendment or modification would have any of the effects described in the
previous two paragraphs, and would affect more than one series of securities
issued under the indenture, then we cannot make the amendment or modifications
without the consent of all of the holders of the securities issued under the
indenture that would be affected by them.
We and the trustee can also enter into supplemental indentures to amend or
modify the indenture or the senior debentures without the consent of any holders
of the senior debentures. We can only do so if those amendments or modifications
would be limited to specific purposes, including:
o showing that another person has succeeded us and assumed our obligations
under the covenants of the indenture and the senior debentures;
o adding to our covenants under the indenture for the benefit of all holders
of debt securities under the indenture or surrender any right or power we
have under the indenture;
o adding to, changing or eliminating any of the provisions of the indenture
in respect of the senior debentures, but only if the change does not
adversely affect the rights of holders of the senior debentures under the
indenture in any material respect;
o establish the form or terms of debt securities of any series;
o evidencing the appointment of a successor trustee or a change in any of the
provisions of the indenture to facilitate administration by more than one
trustee; or
o making clarifying changes to ambiguous, incorrect or inconsistent language
in the indenture or the senior debentures that do not adversely affect the
rights of the holders of the senior debentures under the indenture in any
material respect. (Section 1201).
Defeasance
The indenture provides that we can at any time terminate almost all of our
obligations with respect to any outstanding senior debentures and the indenture.
We cannot, however terminate some obligations, including our obligations to
register the transfer or exchange of the senior debentures, replace mutilated,
destroyed, lost or stolen senior debentures, to maintain agencies in respect of
the senior debentures and hold moneys for payment in trust. (Sections 701 and
702).
If we desire to exercise our option to satisfy and discharge our
obligations under the indenture (a defeasance), then we must deposit in trust
with the trustee money or U.S. government obligations sufficient to pay the
outstanding principal amount of the senior debentures as well as the interest on
the senior debentures to maturity. We must also comply with some other
provisions. In particular, we must obtain:
o an opinion of tax counsel that the defeasance will not result in
recognition of any gain or loss to holders of the senior debentures for
federal income tax purposes (Officers' Certificate);
o an opinion of counsel that any U.S. government obligation that we deposit
in trust meet the requirements of U.S. government obligations set forth in
the indenture; and
-14-
o an opinion of a nationally recognized independent public accountant to the
effect that we have deposited with the trustee money or U.S. government
obligations sufficient to pay the outstanding principal amount of the
senior debentures as well as the interest of the senior debentures to
maturity.
Governing Law
The indenture and the senior debentures will be governed by, and construed
in accordance with, the laws of the State of New York. (Section 112).
The Trustee
Bank One Trust will act as trustee, registrar, transfer agent and paying
agent for the senior debentures. We can remove the trustee with or without cause
so long as no event which is, or after notice or lapse of time would become, an
event of default shall have occurred and be continuing.
We and certain of our affiliates maintain banking and other business
relationships in the ordinary course of business with the trustee and its
affiliates. In addition, the trustee and certain of its affiliates may serve as
trustee for other securities issued by us or by our affiliates.
To the extent provided in the indenture, the trustee will have a prior
claim on amounts held by it under the indenture for the payment of its
compensation and expenses and for the repayment of advances made by it to effect
performance of some covenants in the indenture.
Book-Entry Delivery and Settlement
We will issue the senior debentures in whole or in part in the form of one
or more global certificates or notes, which we refer to as global securities. We
will deposit the global securities with or on behalf of The Depository Trust
Company, referred to as DTC, and registered in the name of Cede & Co., as
nominee of DTC, or else the global securities will remain in the custody of the
trustee in accordance with the FAST Balance Certificate Agreement between DTC
and the trustee.
DTC has advised us that:
o 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 Commercial
Code and a "clearing agency" registered under Section 17A of the
Securities Exchange Act of 1934;
o DTC holds securities that its direct participants deposit with DTC and
facilitates the settlement among direct participants of securities
transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in direct
participants' accounts, thereby eliminating the need for physical
movement of securities certificates;
o direct participants include securities brokers and dealers, trust
companies, clearing corporations and other organizations;
o DTC is owned by a number of its direct participants and by the New
York Stock Exchange, Inc., the American Stock Exchange LLC and the
National Association of Securities Dealers, Inc.;
o access to the DTC system is also available to indirect participants
such as securities brokers and dealers, banks and trust companies that
clear through or maintain a custodial relationship with a direct
participant, either directly or indirectly; and
o the rules applicable to DTC and its direct and indirect participants
are on file with the SEC.
-15-
We have provided the following descriptions of the operations and
procedures of DTC solely as a matter of convenience. These operations and
procedures are solely within the control of DTC and are subject to change by
them from time to time. Neither we, the underwriters nor the trustee take any
responsibility for these operations or procedures, and you are urged to contact
DTC or its participants directly to discuss these matters.
We expect that under procedures established by DTC:
o upon deposit of the global securities with DTC or its custodian, DTC
will credit on its internal system the accounts of direct participants
designated by the underwriters with portions of the principal amounts
of the global securities; and
o ownership of the senior debentures will be shown on, and the transfer
of ownership of the senior debentures will be effected only through,
records maintained by DTC or its nominee, with respect to interests of
direct participants, and the records of direct and indirect
participants, with respect to interests of persons other than
participants.
The laws of some jurisdictions require that purchasers of securities take
physical delivery of those securities in the form of a certificate. For that
reason, it may not be possible to transfer interests in a global security to
those persons. In addition, because DTC can act only on behalf of its
participants, who in turn act on behalf of persons who hold interests through
participants, the ability of a person having an interest in a global security to
pledge or transfer that interest to persons or entities that do not participate
in DTC's system, or otherwise to take actions in respect of that interest, may
be affected by the lack of a physical definitive security in respect of that
interest.
So long as DTC or its nominee is the registered owner of a global security,
DTC or that nominee will be considered the sole owner or holder of the senior
debentures represented by that global security for all purposes under the
indenture and under the senior debentures. Except as described below, owners of
beneficial interests in a global security will not be entitled to have senior
debentures represented by that global security registered in their names, will
not receive or be entitled to receive the senior debentures in the form of a
physical certificate and will not be considered the owners or holders of the
senior debentures under the indenture or under the senior debentures, and may
not be entitled to give the trustee directions, instructions or approvals. For
that reason, each holder owning a beneficial interest in a global security must
rely on DTC's procedures and, if that holder is not a direct or indirect
participant in DTC, on the procedures of the DTC participant through which that
holder owns its interest, to exercise any rights of a holder of senior
debentures under the indenture or the global security.
Neither we nor the trustee will have any responsibility or liability for
any aspect of DTC's records relating to the senior debentures or relating to
payments made by DTC on account of the senior debentures, or any responsibility
to maintain, supervise or review any of DTC's records relating to the senior
debentures.
We will make payments on the senior debentures represented by the global
securities to DTC or its nominee, as the registered owner of the senior
debentures. We expect that when DTC or its nominee receives any payment on the
senior debentures represented by a global security, DTC will credit
participants' accounts with payments in amounts proportionate to their
beneficial interests in the global security as shown in DTC's records. We also
expect that payments by DTC's participants to owners of beneficial interests in
the global security held through those participants will be governed by standing
instructions and customary practice as is now the case with securities held for
the accounts of customers registered in the names of nominees for such
customers. DTC's participants will be responsible for those payments.
Payments on the senior debentures represented by the global securities will
be made in immediately available funds. Transfers between participants in DTC
will be made in accordance with DTC's rules and will be settled in immediately
available funds.
-16-
Certificated Senior Debentures
We will issue certificated senior debentures to each person that DTC
identifies as the beneficial owner of senior debentures represented by the
global securities upon surrender by DTC of the global securities only if:
o DTC notifies us that it is no longer willing or able to act as a
depository for the global securities, and we have not appointed a
successor depository within 90 days of that notice;
o an event of default with respect to the senior debentures has occurred
and is continuing; or
o we decide not to have the senior debentures represented by a global
security.
Neither we nor the trustee will be liable for any delay by DTC, its nominee
or any direct or indirect participant in identifying the beneficial owners of
the related senior debentures. We and the trustee may conclusively rely on, and
will be protected in relying on, instructions from DTC or its nominee, including
instructions about the registration and delivery, and the respective principal
amounts, of the senior debentures to be issued.
-17-
UNDERWRITING
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Barclays Capital
Inc. are acting as representatives of each of the underwriters named below.
Subject to the terms and conditions set forth in a purchase agreement among us
and the underwriters, we have agreed to sell to the underwriters, and each of
the underwriters severally and not jointly has agreed to purchase from us, the
principal amount of senior debentures set forth opposite its name below.
Underwriters Principal Amount
------------ ----------------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated............... $
Barclays Capital Inc............................
------------
Total........................................... $100,000,000
============
The underwriters have agreed, subject to the terms and conditions contained
in the purchase agreement, to purchase all of the senior debentures sold under
the purchase agreement if any of these senior debentures are purchased. If an
underwriter defaults, the purchase agreement provides that the purchase
commitments of the non-defaulting underwriters may be increased or the purchase
agreement may be terminated.
The underwriters are offering the senior debentures, subject to prior sale,
when, as and if issued to and accepted by them, subject to approval of legal
matters by their counsel, including the validity of the senior debentures, and
other conditions contained in the purchase agreement, such as the receipt by the
underwriters of officer's certificates and legal opinions. The underwriters
reserve the right to withdraw, cancel or modify offers to the public and to
reject orders in whole or in part.
The senior debentures are a new issue of securities with no established
trading market. The underwriters have advised us that they intend to make a
market in the senior debentures but the underwriters are not obligated to do so
and may discontinue market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for the senior debentures.
Commissions and Discounts
The representatives have advised us that the underwriters propose initially
to offer the senior debentures to the public at the public offering price on the
cover page of the prospectus, and to certain dealers at that price less a
concession not in excess of ____% of the principal amount of the senior
debentures. The underwriters may allow, and the dealers may reallow, a discount
not in excess of ____% of the principal amount of the senior debentures to other
dealers. After the initial public offering, the public offering price,
concession and discount may be changed.
The expenses of this offering, not including the underwriting discount, are
estimated at $225,000 and are payable by us.
No Sale of Similar Securities
We have agreed, with exceptions, not to sell or transfer any of our senior
debentures for 15 days after the date of this prospectus without first obtaining
the written consent of Merrill Lynch on behalf of the underwriters.
Specifically, we have agreed not to directly or indirectly:
o Offer, pledge, sell or contract to sell any debt securities;
o Sell any option or contract to purchase any debt securities;
o Purchase any option or contract to sell any debt securities;
o Grant any option, right or warrant to sell any debt securities;
-18-
o Lend or otherwise dispose of or transfer any debt securities;
o File a registration statement related to the debt securities; or
o Enter into any swap or other agreement that transfers, in whole or in
part, the economic consequence of ownership of any debt securities,
whether any such swap or transaction is to be settled by delivery of
debt securities or other securities, in cash or otherwise.
This lockup provision applies to the debt securities and to securities
convertible into or exchangeable or exercisable for or repayable with the debt
securities.
Indemnification
We have agreed to indemnify the underwriters against certain liabilities,
including certain liabilities under the Securities Act of 1933, or to contribute
to payments the underwriters may be required to make in respect of those
liabilities.
Price Stabilization and Short Position
In connection with the offering, the underwriters are permitted to engage
in transactions that stabilize the market price of the senior debentures. Such
transactions consist of bids or purchases to peg, fix or maintain the price of
the senior debentures.
If the underwriters create a short position in the senior debentures in
connection with the offering, i.e., if they sell more senior debentures than are
listed on the cover page of this prospectus, then the representatives may reduce
that short position by purchasing senior debentures in the open market.
Purchases of our senior debentures to stabilize or reduce a short position could
cause the price of our senior debentures to be higher than it might be in the
absence of such purchases.
In general, purchases of a security to stabilize the price or to reduce a
short position may cause the price of the security to be higher than it might be
in the absence of these purchases.
Neither we nor any of the underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the senior debentures. In addition,
neither we nor any of the underwriters makes any representation that the
representatives will engage in these transactions or that these transactions,
once commenced, will not be discontinued without notice.
Other Relationships
Some of the underwriters or their affiliates have provided investment or
commercial banking services to us in the past and are likely to do so in the
future. They receive customary fees and commissions for these services. In
particular, affiliates of Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Barclays Capital Inc. are lenders under our credit facility.
-19-
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports and other information with
the SEC. We have also filed a registration statement on Form S-3, including
exhibits, under the Securities Act of 1933 with respect to the securities
offered by this prospectus. This prospectus is a part of the registration
statement, but does not contain all of the information included in the
registration statement or the exhibits. You may read and copy the registration
statement and any other document that we file at the SEC's public reference room
at 450 Fifth Street, N.W., Washington D.C. You can call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
room. You can also find our public filings with the SEC on the internet at a web
site maintained by the SEC located at http://www.sec.gov.
We are "incorporating by reference" specified documents that we file with
the SEC, which means:
o incorporated documents are considered part of this prospectus;
o we are disclosing important information to you by referring you to those
documents; and
o information we file with the SEC will automatically update and supersede
information contained in this prospectus.
We incorporate by reference our Annual Report on Form 10-K for the year
ended December 31, 2002, our Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 2003 and June 30, 2003 and any future filings we make
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934 after the date of this prospectus and before the end of the offering
of the securities pursuant to this prospectus. Some of these reports, however,
are filed on a combined basis with our parent, Alliant Energy Corporation, and
its direct subsidiary, Wisconsin Power and Light Company. Information contained
in these reports relating to these entities is filed by them on their own behalf
and not by us, and you should not rely on that information when deciding whether
to invest in our senior debentures.
You may request a copy of any of these filings, at no cost, by writing to
F. J. Buri, Corporate Secretary, Interstate Power and Light Company, 4902 North
Biltmore Lane, Madison, Wisconsin 53718, or by calling Mr. Buri at (608)
458-3311.
LEGAL MATTERS
The validity of the senior debentures will be passed upon for us by Foley &
Lardner. Some legal matters will be passed upon for the underwriters by Gibson,
Dunn & Crutcher LLP.
EXPERTS
Our consolidated financial statements and the related financial statement
schedules incorporated in this prospectus by reference from Interstate Power and
Light Company's Annual Report on Form 10-K for the year ended December 31, 2002
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing.
-20-
================================================================================
$100,000,000
Interstate Power and Light Company
% Senior Debentures due 2018
_______________________
PROSPECTUS
_______________________
Merrill Lynch & Co.
Barclays Capital
_____________ ___, 2003
================================================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Securities and Exchange Commission filing fee...... $ 8,090
Legal fees and expenses............................ 125,000
Accounting fees and expenses....................... 35,000
Printing expenses.................................. 30,000
Trustee fees and expenses.......................... 4,000
Miscellaneous...................................... 22,910
---------
Total expenses................................ $ 225,000
=========
All of the above fees and expenses will be paid by Interstate Power and
Light Company (the "Registrant"). Other than the Securities and Exchange
Commission filing fee, all fees and expenses are estimated.
Item 15. Indemnification of Directors and Officers.
The Iowa Business Corporation Act ("IBCA") grants each corporation
organized thereunder, such as the Registrant, the power to indemnify its
directors and officers against liabilities for certain of their acts. The
Registrant's Restated Articles of Incorporation provide that the Registrant
shall indemnify its directors and officers to the fullest extent permitted by
the IBCA and may, but is not required to, purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Registrant, or is or was serving at the request of the Registrant as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise against any liability asserted and incurred against
such person in any such capacity or arising out of such person's status as such,
whether or not the Registrant would have the power to indemnify such person
against such liability under the provisions thereof. The Registrant's Bylaws
permit the Registrant to maintain such insurance and further provide that the
Registrant shall indemnify directors and officers of the Registrant to the full
extent permitted by the IBCA and advance any and all reasonable expenses
incurred in any proceeding to which any such director or officer is a party
because he or she is or was a director or officer.
Under the IBCA, directors of the Registrant are not subject to personal
liability to the Registrant or its shareowners for acts or failures to act
except under certain circumstances. In addition, the IBCA grants corporations
organized thereunder, such as the Registrant, the authority to adopt a provision
in their respective articles of incorporation eliminating or limiting, with
certain exceptions, the personal liability of a director to the corporation or
to its shareowners for monetary damages for certain breaches of fiduciary duty
as a director. The Registrant's Restated Articles of Incorporation eliminates
the personal liability of each director except for liability (i) for any breach
of the director's duty of loyalty to the Registrant or its shareowners, (ii) for
acts or omissions not in good faith or which involve any intentional misconduct
or knowing violation of the law, (iii) for any transaction from which the
director derived an improper personal benefit, or (iv) under Section 490.833 of
the IBCA relating to liability for unlawful distribution.
The foregoing statements are subject to the detailed provisions of the IBCA
and the Restated Articles of Incorporation and Bylaws of the Registrant and
should be read in connection with these other documents for a more full
understanding of their effect on the Registrant.
The indemnification provided by the Registrant is not exclusive of any
other rights to which a director or officer of the Registrant may be entitled.
The Registrant also carries directors' and officers' liability insurance. The
Registrant's directors' and officers' insurance policies are designed to
reimburse the Registrant for any payments made by it pursuant to the foregoing
indemnification provisions.
II-1
Item 16. Exhibits and Financial Statement Schedules.
The exhibits listed in the accompanying Exhibit Index are filed or
incorporated by reference as part of this Registration Statement.
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(b) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
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.
(c) 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
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-2
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 of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Madison, State of Wisconsin, on August 25, 2003.
INTERSTATE POWER AND LIGHT COMPANY
By: /s/ Erroll B. Davis, Jr.
------------------------------------
Erroll B. Davis, Jr.
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Erroll B. Davis, Jr.
- ------------------------ Chairman, Chief Executive Officer and August 25, 2003
Erroll B. Davis, Jr. Director (Principal Executive Officer)
/s/ Thomas M. Walker
- ------------------------ Executive Vice President and Chief
Thomas M. Walker Financial Officer (Principal August 25, 2003
Financial Officer)
/s/ John E. Kratchmer
- ------------------------ Vice President-Controller and Chief
John E. Kratchmer Accounting Officer (Principal August 25, 2003
Accounting Officer)
* Director August 25, 2003
- ------------------------
Alan B. Arends
* Director August 25, 2003
- ------------------------
Michael L. Bennett
* Director August 25, 2003
- ------------------------
Jack B. Evans
* Director August 25, 2003
- ------------------------
Katharine C. Lyall
* Director August 25, 2003
- ------------------------
Singleton B. McAllister
Director August 25, 2003
- ------------------------
Ann K. Newhall
* Director August 25, 2003
- ------------------------
David A. Perdue
* Director August 25, 2003
- ------------------------
Judith D. Pyle
S-1
Signature Title Date
--------- ----- ----
* Director August 25, 2003
- ------------------------
Robert W. Schlutz
* Director August 25, 2003
- ------------------------
Wayne H. Stoppelmoor
* Director August 25, 2003
- ------------------------
Anthony R. Weiler
*By: /s/ Erroll B. Davis, Jr.
-----------------------------
Erroll B. Davis, Jr.
Attorney-in-fact
S-2
EXHIBIT INDEX
Exhibit Number Document Description
- -------------- --------------------
(1) Form of Purchase Agreement.*
(4.1) Indenture of Mortgage and Deed of Trust, dated as of
September 1, 1993 (the "1993 Indenture"), between IP&L and
Bank One Trust Company, National Association ("Bank One
Trust"), successor, as Trustee (incorporated by reference to
Exhibit 4(c) to IP&L's Form 10-Q for the quarter ended
September 30, 1993), and the indentures supplemental thereto
dated, respectively, October 1, 1993, November 1, 1993,
March 1, 1995, September 1, 1996 and April 1, 1997 (Exhibit
4(d) in IP&L's Form 10-Q dated November 12, 1993, Exhibit
4(e) in IP&L's Form 10-Q dated November 12, 1993, Exhibit
4(b) in IP&L's Form 10-Q dated May 12, 1995, Exhibit 4(c)(i)
in IP&L's Form 8-K dated September 19, 1996 and Exhibit 4(a)
in IP&L's Form 10-Q dated May 14, 1997).
(4.2) Indenture of Mortgage and Deed of Trust, dated as of August
1, 1940, between IP&L and Bank One Trust Company, successor,
as Trustee (incorporated by reference to Exhibit 2(a) to
IP&L's Registration Statement, File No. 2-25347), and the
indentures supplemental thereto dated, respectively, March
1, 1941, July 15, 1942, August 2, 1943, August 10, 1944,
November 10, 1944, August 8, 1945, July 1, 1946, July 1,
1947, December 15, 1948, November 1, 1949, November 10,
1950, October 1, 1951, March 1, 1952, November 5, 1952,
February 1, 1953, May 1, 1953, November 3, 1953, November 8,
1954, January 1, 1955, November 1, 1955, November 9, 1956,
November 6, 1957, November 4, 1958, November 3, 1959,
November 1, 1960, January 1, 1961, November 7, 1961,
November 6, 1962, November 5, 1963, November 4, 1964,
November 2, 1965, September 1, 1966, November 30, 1966,
November 7, 1967, November 5, 1968, November 1, 1969,
December 1, 1970, November 2, 1971, May 1, 1972, November 7,
1972, November 7, 1973, September 10, 1974, November 5,
1975, July 1, 1976, November 1, 1976, December 1, 1977,
November 1, 1978, December 1, 1979, November 1, 1981,
December 1, 1980, December 1, 1982, December 1, 1983,
December 1, 1984, March 1, 1985, March 1, 1988, October 1,
1988, May 1, 1991, March 1, 1992, October 1, 1993, November
1, 1993, March 1, 1995, September 1, 1996 and April 1, 1997
(Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in File No.
2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in
File No. 2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit
2(a) in File No. 2-25347, Exhibit 2(a) in File No. 2-25347,
Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in File No.
2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in
File No. 2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit
2(a) in File No. 2-25347, Exhibit 2(a) in File No. 2-25347,
Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in File No.
2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in
File No. 2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit
2(a) in File No. 2-25347, Exhibit 2(a) in File No. 2-25347,
Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in File No.
2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in
File No. 2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit
2(a) in File No. 2-25347, Exhibit 2(a) in File No. 2-25347,
Exhibit 2(a) in File No. 2-25347, Exhibit 2(a) in File No.
2-25347, Exhibit 2(a) in File No. 2-25347, Exhibit 4.10 in
IP&L's Form 10-K for the year 1966, Exhibit 4.10 in IP&L's
Form 10-K for the year 1966, Exhibit 4.10 in IP&L's Form
10-K for the year 1967, Exhibit 4.10 in IP&L's Form 10-K for
the year 1968, Exhibit 4.10 in IP&L's Form 10-K for the year
1969, Exhibit 1 in IP&L's Form 8-K dated December 1970,
Exhibit 2(g) in File No. 2-43131, Exhibit 1 in IP&L's Form
8-K dated May 1972, Exhibit 2(i) in File No. 2-56078,
Exhibit 2(j) in File No. 2-56078, Exhibit 2(k) in File No.
2-56078, Exhibit 2(l) in File No. 2-56078, Exhibit 1 in
IP&L's Form 8-K dated July 1976, Exhibit 1 in IP&L's Form
8-K dated December 1976, Exhibit 2(o) in File No. 2-60040,
Exhibit 1 in IP&L's Form 10-Q dated June 30, 1979, Exhibit
2(q) in Form S-16 in File No. 2-65996, Exhibit 2 in IP&L's
Form 10-Q dated March 31, 1982, Exhibit 4(s) in IP&L's Form
10-K for the year 1981, Exhibit 4(t) in IP&L's Form 10-K for
the year 1982, Exhibit 4(u) in IP&L's Form 10-K for the year
1983, Exhibit 4(v) in IP&L's Form 10-K for the year 1984,
Exhibit 4(w) in IP&L's Form 10-K for
- -----------------------
* To be filed by amendment or under subsequent Current Report on Form 8-K.
E-1
Exhibit Number Document Description
- -------------- --------------------
the year 1984, Exhibit 4(b) in IP&L's Form 10-Q dated May
12, 1988, Exhibit 4(c) in IP&L's Form 10-Q dated November
10, 1988, Exhibit 4(d) in IP&L's Form 10-Q dated August 13,
1991, Exhibit 4(c) in IP&L's Form 10-K for the year 1991,
Exhibit 4(a) in IP&L's Form 10-Q dated November 12, 1993,
Exhibit 4(b) in IP&L's Form 10-Q dated November 12, 1993,
Exhibit 4(a) in IP&L's Form 10-Q dated May 12, 1995, Exhibit
4(f) in IP&L's Form 8-K dated September 19, 1996 and Exhibit
4(b) in IP&L's Form 10-Q dated May 14, 1997).
(4.3) Indenture or Deed of Trust dated as of February 1, 1923,
between IP&L and Bank One Trust, successor, and Lawrence
Dillard, successor, as Trustees (incorporated by reference
to Exhibit B-1 to File No. 2-1719), and the indentures
supplemental thereto dated, respectively, May 1, 1940, May
2, 1940, October 1, 1945, October 2, 1945, January 1, 1948,
September 1, 1950, February 1, 1953, October 2, 1953, August
1, 1957, September 1, 1962, June 1, 1967, February 1, 1973,
February 1, 1975, July 1, 1975, September 2, 1975, March 10,
1976, February 1, 1977, January 1, 1978, March 1, 1979,
March 1, 1980, May 31, 1986, July 1, 1991, September 1, 1992
and December 1, 1994 (Exhibit B-1-k in File No. 2-4921,
Exhibit B-1-l in File No. 2-4921, Exhibit 7(m) in File No.
2-8053, Exhibit 7(n) in File No. 2-8053, Exhibit 7(o) in
File No. 2-8053, Exhibit 4(e) in File No. 33-3995, Exhibit
4(b) in File No. 2-10543, Exhibit 4(q) in File No. 2-10543,
Exhibit 2(b) in File No. 2-13496, Exhibit 2(b) in File No.
2-20667, Exhibit 2(b) in File No. 2-26478, Exhibit 2(b) in
File No. 2-46530, Exhibit 2(aa) in File No. 2-53860, Exhibit
2(bb) in File No. 2-54285, Exhibit 2(bb) in File No.
2-57510, Exhibit 2(cc) in File No. 2-57510, Exhibit 2(ee) in
File No. 2-60276, Exhibit 2 in File No. 0-849, Exhibit 2 in
File No. 0-849, Exhibit 2 in File No. 0-849, Exhibit 4(g) in
File No. 33-3995, Exhibit 4(h) in File No. 0-849, Exhibit
4(m) in File No. 0-849 and Exhibit 4(f) in File No.
0-4117-1).
(4.4) Indenture (For Unsecured Subordinated Debt Securities),
dated as of December 1, 1995, between IP&L and Bank One
Trust, successor, as Trustee (incorporated by reference to
Exhibit 4(i) to IP&L's Amendment No. 1 to Registration
Statement, File No. 33-62259).
(4.5) Indenture (For Senior Unsecured Debt Securities), dated as
of August 1, 1997 (the "1997 Indenture"), between IP&L and
Bank One Trust, successor, as Trustee (incorporated by
reference to Exhibit 4(j) to IP&L's Registration Statement,
File No. 333-32097).
(4.6) Officers' Certificate, dated as of August 4, 1997, creating
IP&L's 6-5/8% Senior Debentures, Series A, due 2009
(incorporated by reference to Exhibit 4.12 to IP&L's Annual
Report on Form 10-K for the year ended December 31, 2000).
(4.7) Officers' Certificate, dated as of March 6, 2001, creating
IP&L's 6-3/4% Senior Debentures, Series B, due 2011
(incorporated by reference to Exhibit 4 to IP&L's Form 8-K,
dated March 6, 2001).
(4.8) The Original through the Nineteenth Supplemental Indentures
of IP&L, successor, to JPMorgan Chase Bank and James P.
Freeman, successor, as Trustee, dated January 1, 1948
securing First Mortgage Bonds (incorporated by reference to
Exhibits 4(b) through 4(t) to Interstate Power Company's
("IPC") Registration Statement No. 33-59352 dated March 11,
1993).
(4.9) Twentieth Supplemental Indenture of IP&L, successor, to
JPMorgan Chase Bank and James P. Freeman, successor, as
Trustees, dated May 15, 1993 (incorporated by reference to
Exhibit 4(u) to IPC's Registration Statement No. 33-59352
dated March 11, 1993).
(4.10) Twenty-First Supplemental Indenture of IP&L, successor, to
JPMorgan Chase Bank and James P. Freeman, as Trustees, dated
December 31, 2001 (incorporated by reference to Exhibit 4.3
to IP&L's Form 8-K, dated January 1, 2002).
E-2
Exhibit Number Document Description
- -------------- --------------------
(4.11) Indenture (For Senior Unsecured Debt Securities), dated as
of August 20, 2003, between IP&L and Bank One Trust, as
Trustee.
Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the
Registrant agrees to furnish to the Securities and Exchange
Commission, upon request, any instrument defining the rights
of holders of long-term debt not being registered that is
not filed as an exhibit to this Registration Statement on
Form S-3. No such instrument authorizes securities in excess
of 10% of the total assets of the Registrant.
(5) Opinion of Foley & Lardner (including consent of counsel).
(12) Computation of Ratio of Earnings to Fixed Charges.
(23.1) Consent of Foley & Lardner (filed as part of Exhibit (5)).
(23.2) Consent of Deloitte & Touche LLP.
(24) Powers of Attorney.
(25.1) Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939 of Bank One Trust.
Documents incorporated by reference to filings made by IP&L under the Securities
Exchange Act of 1934, as amended, are under File No. 0-4117-1. Documents
incorporated by reference to filings made by IPC under the Securities Exchange
Act of 1934, as amended, are under File No. 1-3632.
- -----------------------
* To be filed by amendment or under subsequent Current Report on Form 8-K.
E-3