-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OKYT9EJrqFksZaBOP9C0HLdwyzO9jtmLAQRKRh6C8OWDkbzccLWdF1oGCOdeJkFw LApFS9hQW113ScdIsrbRaA== 0000065984-98-000086.txt : 19980603 0000065984-98-000086.hdr.sgml : 19980603 ACCESSION NUMBER: 0000065984-98-000086 CONFORMED SUBMISSION TYPE: U-1/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19980602 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ENTERGY CORP /DE/ CENTRAL INDEX KEY: 0000065984 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 721229752 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U-1/A SEC ACT: SEC FILE NUMBER: 070-09189 FILM NUMBER: 98641227 BUSINESS ADDRESS: STREET 1: 639 LOYOLA AVE CITY: NEW ORLEANS STATE: LA ZIP: 70113 BUSINESS PHONE: 5045295262 FORMER COMPANY: FORMER CONFORMED NAME: ENTERGY GSU HOLDINGS INC /DE/ DATE OF NAME CHANGE: 19940329 FORMER COMPANY: FORMER CONFORMED NAME: ENTERGY CORP /FL/ DATE OF NAME CHANGE: 19940329 FORMER COMPANY: FORMER CONFORMED NAME: MIDDLE SOUTH UTILITIES INC DATE OF NAME CHANGE: 19890521 U-1/A 1 File No. 70-9189 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form U-l/A Amendment No. 1 ___________________________________ APPLICATION-DECLARATION under THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ___________________________________ Entergy Corporation 639 Loyola Avenue New Orleans, Louisiana 70113 (Name of company filing this statement and address of principal executive offices) ___________________________________ Entergy Corporation (Name of top registered holding company parent of each applicant or declarant) ___________________________________ Naomi Nakagama Senior Vice President-Finance and Treasurer Entergy Services, Inc. 639 Loyola Avenue New Orleans, Louisiana 70113 (Names and addresses of agents for service) ___________________________________ The Commission is also requested to send copies of any communications in connection with this matter to: Laurence M. Hamric, Esq. William T. Baker, Jr. Esq. Ann G. Roy, Esq. Reid & Priest LLP Entergy Services, Inc. 40 West 57th Street 639 Loyola Avenue New York, NY 10019 New Orleans, LA 70113 Item 1. Description of Proposed Transactions. Item 1. D of the Application-Declaration on Form U-1 is hereby amended and restated as follows and is further amended to include an additional paragraphs E and F. D. Compliance With Rules 53 and 54. Entergy hereby represents that, pursuant to Rule 54 under the Act, (1) for the reasons discussed below, the condition set forth in Rule 53(a)(1) that Entergy's "aggregate investment" in "exempt wholesale generators" ("EWGs") and "foreign utility companies" ("FUCOs") not exceed 50% of Entergy's "consolidated retained earnings" is not currently satisfied, and (2) all of the other criteria of Rule 53(a) and (b) are satisfied. Entergy's "aggregate investment" in EWGs and FUCOs is equal to approximately 54% of Entergy's "consolidated retained earnings" as of March 31, 1998. Entergy's "aggregate investment" currently exceeds the 50% limitation in Rule 53(a)(1) as a result of certain charges against Entergy's consolidated retained earnings, including a net decrease of approximately $140 million in Entergy's consolidated retained earnings from the quarter ended June 30, 1997 to the quarter ended September 30, 1997. This $140 million net decrease was attributable primarily to the recording in July 1997 of a one-time "windfall profits tax" imposed by the British government on London Electricity plc ("London Electricity"), an indirect subsidiary of Entergy and a FUCO, and other privatized companies in the United Kingdom. This tax, which was approximately US$234 million for London Electricity, was made payable in installments, the first of which was paid on December 1, 1997, and the second which will be due on December 1, 1998. The first installment was paid by London Electricity, without need for additional investment by Entergy, and it is not anticipated that there will be a need for any additional investment by Entergy to fund London Electricity's payment of the second installment. Accordingly, operating earnings attributable to Entergy's investments on EWGs and FUCOs have not had an adverse impact on Entergy's financial integrity. Following the July 2, 1997 announcement by the Labor Government of the proposed windfall profits tax, a Standard & Poor's Ratings Group report listed 13 British utilities, including London Electricity, on "CreditWatch with negative implications". However, as of March 31, 1997, London Electricity's senior debt ratings have not changed due to the enactment of the windfall profits tax. Moreover, as noted below, after Entergy announced its intent to acquire London Electricity, Standard & Poor's Ratings Group affirmed its outstanding ratings on the Entergy's operating companies' senior secured debt. Entergy currently is not rated by Standard & Poor's Ratings Group. However, all of Entergy's operating companies have debt ratings of at least investment grade, except that Entergy Gulf States, Inc.'s ("Gulf States") debt rating for all debt other than senior secured debt is below investment grade. Currently, Gulf States has $883.1 million in long-term debt below investment grade consisting of preferred stock, quarterly income preferred securities, debentures, and tax-exempt bonds. However, as of July 1, 1998, $50 million in debentures will be retired and $21.6 million in tax-exempt bonds will be redeemed resulting in $811.5 million of long-term debt remaining outstanding below investment grade for Gulf States. E. Capitalization Ratios. Entergy states that as of March 31, 1998, Entergy's consolidated capitalization consisted of 42.9% equity (including mandatorily redeemable preferred securities) and 57.1% debt, (including long-term debt, currently maturing long-term debt, preferred stock of subsidiaries with sinking fund, and preference stock of subsidiaries). On a pro forma basis, taking into consideration the transaction contemplated in this filing, the ratios would be 42.2% to 57.8%, respectively, for equity and debt. Entergy states that, its consolidated capitalization ratio, will not be materially effected by this transaction. F. Shareholder Approval at the Annual Meeting. On May 15, 1998, at the Annual Meeting of the Stockholders of Entergy Corporation, the shareholders approved the equity ownership plan. Item 2. Fees, Commissions and Expenses. Item 2, Fees, Commissions and Expenses, is hereby amended and restated in its entirety as follows: Fees and expenses to be incurred in connection with the proposed transactions are expected to be as follows: Morrow & Co. Proxy Solicitation Fees (including distribution and broker invoices) $ 126,000 Bowne Proxy Printing Costs 44,000 Reid & Priest,LLP Counsel to Entergy 4,000 Corporation ------------ TOTAL $ 175,000 ============ Item 6. Exhibits and Financial Statements. (a) Exhibits: *C Registration Statement with respect to the Equity Plan. _________________________ * To be filed by amendment. (b) Financial Statements: SIGNATURE Pursuant to the requirements of the Public Utility Holding Company Act of 1935, the undersigned company has duly caused this Amendment No. 1 to the Application/Declaration to be signed on its behalf by the undersigned thereunto duly authorized. ENTERGY CORPORATION By: /s/ Michael G. Thompson Michael G. Thompson Senior Vice President, General Counsel and Secretary Dated: June 2, 1998 _______________________________ The terms "aggregate investment" and "consolidated retained earnings" are used herein as defined in Rule 53. -----END PRIVACY-ENHANCED MESSAGE-----