File No. 70-9123
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
_____________________________
POST - EFFECTIVE AMENDMENT NO. 4
To
APPLICATION-DECLARATION
Under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
_____________________________
Entergy Corporation Entergy Power, Inc.
639 Loyola Avenue 20 Greenway Plaza
New Orleans, LA 70113 Suite 1025
Houston, TX 77046
Entergy Enterprises, Inc. Entergy Global Power
20 Greenway Plaza Operations Corporation
Suite 1025 20 Greenway Plaza
Houston, TX 77046 Suite 1025
Houston, TX 77046
Entergy Nuclear, Inc. Entergy Operations
1340 Echelon Parkway Services, Inc.
Jackson, MS 39213 110 James Parkway West
Suite 110
St. Rose, LA 70087
Entergy Power Operations U.S., Inc.
20 Greenway Plaza
Suite 1025
Houston, TX 77046
(Names of companies filing this statement
and addresses of principal executive offices)
____________________________
Entergy Corporation
(Name of top registered holding company parent of
each applicant or declarant)
_____________________________
Steven C. McNeal
Vice President and Treasurer
Entergy Corporation
639 Loyola Avenue
New Orleans, LA 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:
Steven C. McNeal
Vice President and Treasurer
Entergy Services, Inc.
639 Loyola Avenue
New Orleans, LA 70113
Mark W. Hoffman, Esq.
Entergy Services, Inc.
639 Loyola Avenue
New Orleans, LA 70113
Kent R. Foster, Esq.
Vice President
Entergy Services, Inc.
P.O. Box 8082
Little Rock, AR 72203
Item 1. Description of Proposed Transactions
Item 1 of the Application-Declaration in this file, as
previously amended, is hereby amended and restated to read in its
entirety as follows:
"Entergy Corporation ("Entergy"), a Delaware corporation
which is a registered holding company under the Public Utility
Holding Company Act of 1935, as amended (the "Act"), and its
wholly-owned subsidiaries Entergy Enterprises, Inc., Entergy
Power, Inc., Entergy Nuclear, Inc., Entergy Operations Services,
Inc., Entergy Global Power Operations Corporation and Entergy
Power Operations U.S., Inc. (Entergy and such other subsidiaries,
collectively, the "Applicants"), hereby request a supplemental
order of the Securities and Exchange Commission (the
"Commission") under the Act, to the extent not exempt from
Commission approval under the Act, or otherwise permitted or
authorized under the Act pursuant to Commission rule, regulation
or order, to extend through December 31, 2005, the following
existing authorizations granted pursuant to the initial order of
the Commission in this File, dated June 22, 1999 (the "June 1999
Order"), which are currently effective through December 31,
20021: (1) for Entergy to acquire, directly or indirectly, the
securities of one or more companies (collectively, the "New
Subsidiaries") organized for purposes of performing certain
service and development activities and/or for purposes of
acquiring (including financing or refinancing an acquisition),
owning and holding the securities of (i) "exempt wholesale
generators" ("EWGs"), as defined in Section 32(a) of the Act,
(ii) "foreign utility companies" ("FUCOs"), as defined in Section
33(a) of the Act (EWGs and FUCOs are sometimes collectively
referred to as "Exempt Projects"), (iii) "exempt
telecommunications companies" ("ETCs"), as defined in Section
34(a) of the Act, (iv) other subsidiary companies (including "O&M
Subs", as hereinafter defined) that are authorized or permitted
by rule, regulation or order of the Commission under the Act to
engage in other businesses ("Authorized Subsidiary Companies")2,
(v) other New Subsidiaries and/or (vi) "energy-related
companies", as defined in Rule 58 under the Act ("Energy-related
Companies") (New Subsidiaries, Exempt Projects, ETCs, Authorized
Subsidiary Companies and Energy-related Companies are
collectively referred to herein as "Non-utility Companies"); (2)
for Entergy to acquire, directly or indirectly, the securities of
one or more subsidiaries ("O&M Subs") organized for the purpose
of providing operations and maintenance services to non-associate
companies and associate Non-utility Companies; (3) for
Non-utility Companies to issue and sell securities to Entergy, to
other Non-utility Companies and/or to non-associate companies for
the purpose of financing (or refinancing) investments in
Non-utility Companies3; and (4) for certain related
transactions, all as more particularly described herein.
I. Proposed Transactions
A. Organization of New Subsidiaries, O&M Subs and Related
Transactions
Pursuant to the June 1999 Order, Entergy is currently
authorized, through December 31, 2002, to, directly or
indirectly, acquire the securities of New Subsidiaries. To
facilitate its investments in FUCOs, EWGs and other Non-utility
Companies, and to provide Entergy with additional flexibility to
structure (and restructure) its investments in Non-utility
Companies, Entergy proposes that its authorization to create New
Subsidiaries be extended for an additional term of three years
(i.e., from January 1, 2003 through December 31, 2005) (the "New
Authorization Period"). As set forth in the June 1999 Order, New
Subsidiaries may be direct or indirect subsidiary companies used
to acquire, hold and/or finance the acquisition of, the
securities of one or more Exempt Projects, ETCs, Energy-related
Companies, other New Subsidiaries, O&M Subs and/or other
Authorized Subsidiary Companies, or to raise debt or equity
capital for purposes described herein. New Subsidiaries may also
perform Development Activities, Administrative Services and/or
Consulting Services, as described further below. To the extent
such transactions are not exempt from the Act or otherwise
authorized or permitted by rule, regulation or order of the
Commission issued thereunder, Entergy requests authority for New
Subsidiaries to engage in the activities described herein.
There are a number of legal and business reasons for the use
of special purpose subsidiaries such as the New Subsidiaries in
connection with investments in Non-utility Companies. For
example, the formation and acquisition of special purpose
subsidiaries is often necessary or desirable to facilitate the
acquisition and ownership of a FUCO, an EWG or another Non-
utility Company. Furthermore, the laws of some foreign countries
may require that the bidder in a privatization program be a
domestic company in that country. In such cases, it would be
necessary for Entergy to form a foreign subsidiary as the entity
submitting the bid or other proposal. In addition, the
interposition of one or more New Subsidiaries may allow Entergy
to defer the repatriation of foreign source income, or to take
full advantage of favorable tax treaties among foreign countries,
or otherwise to secure favorable U.S. income tax treatment that
would not otherwise be available. New Subsidiaries also serve to
isolate business risks, facilitate subsequent adjustments to, or
sales to, ownership interests by or among the members of the
ownership group, or to raise debt or equity capital in domestic
or foreign markets.
A New Subsidiary may be organized, among other things, (1)
in order to facilitate the making of bids or proposals to develop
or acquire an interest in any EWG, FUCO or another Non-utility
Company; (2) after the award of such a bid proposal, in order to
facilitate closing on the purchase or financing of an EWG, FUCO
or another Non-utility Company; (3) at any time subsequent to the
consummation of an acquisition of an interest in an EWG, FUCO or
another Non-utility Company in order, among other things, to
effect an adjustment in the respective ownership interests in
such business held by Entergy and non-affiliated investors; (4)
to facilitate the sale of ownership interests in one or more
EWGs, FUCOs or other Non-utility Companies; (5) to comply with
applicable laws of foreign jurisdictions limiting or otherwise
relating to the ownership of domestic companies by foreign
nationals; (6) as a part of tax planning in order to limit
Entergy's exposure to U.S. and foreign taxes; (7) to further
insulate Entergy, its domestic retail electric utility companies,
and its other regulated businesses from operational or other
business risks associated with investments in Non-utility
Companies; or (8) for other lawful business purposes.
Investments in New Subsidiaries may take the form of any
combination of the following: (1) purchases of capital shares,
partnership interests, member interests in limited liability
companies, trust certificates or other forms of equity interests
(collectively, "Equity Securities"); (2) capital contributions;
(3) open account advances without interest; (4) loans; and (5)
Guarantees issued, provided or arranged in respect of the
securities or other obligations of the New Subsidiaries (as
authorized by supplemental order of the Commission, dated August
21, 2000 (HCAR No. 27216) in this File). Funds for any direct or
indirect investment by Entergy in any New Subsidiary will be
derived from (1) the issue and sale by Entergy of common stock,
preferred stock and, directly or indirectly, through one or more
special purpose financing subsidiaries, unsecured long-term
indebtedness and other forms of preferred or equity-linked
securities, pursuant to order of the Commission, dated April 3,
2001 (HCAR No. 27371) (the "April 2001 Order"); (2) the issue and
sale of common stock in connection with Entergy's Divided
Reinvestment and Stock Purchase Plan, pursuant to orders of the
Commission dated March 25, 1997 (HCAR No. 26693) and December 15,
2000 (HCAR No. 27300); (3) the issue and sale of short term debt,
pursuant to the order of the Commission dated February 26, 1997
(HCAR No. 26674) and the April 2001 Order; (4) any appropriate
future debt or Equity Securities issuance authorization obtained
by Entergy from the Commission; and (5) other available cash
resources. To the extent that Entergy provides funds to a New
Subsidiary which are used for the purpose of making an investment
in an Exempt Project or an Energy-related Company, the amount of
such funds would be included in Entergy's "aggregate investment"
in such entities, as calculated in accordance with Rule 53 or
Rule 58, as applicable.
Entergy may determine from time to time to consolidate or
otherwise reorganize all or any part of its direct and indirect
ownership interests in Non-utility Companies and/or New
Subsidiaries through which it may hold investments in Non-utility
Companies, and activities and functions related to such
investments, under one or more New Subsidiaries. To effect any
such consolidation or other reorganization, Entergy could, among
other things, directly or indirectly contribute to a New
Subsidiary all of the outstanding Equity Securities of one or
more Non-utility Companies (including a New Subsidiary) or sell
the Equity Securities of one or more Non-utility Companies to a
New Subsidiary. Alternatively, a Non-utility Company could
dividend the securities of one or more Non-utility Companies
(including a New Subsidiary) to a New Subsidiary.
To the extent such transactions are not exempt from the Act
or otherwise authorized or permitted by rule, regulation or order
of the Commission issued thereunder, Entergy hereby requests a
continuation of its existing authorization under the Act to
consolidate or otherwise reorganize, under one or more New
Subsidiaries, Entergy's ownership interests in one or more Non-
utility Companies the acquisition of the securities of which is
exempt from Commission approval under the Act. As indicated
above, such transactions may take the form of such Non-utility
Companies selling, contributing or transferring such ownership
interests in the form of a dividend to New Subsidiaries, and New
Subsidiaries acquiring, directly or indirectly, the Equity
Securities of such Non-utility Companies. Each such transaction
would be effected in compliance with all applicable state or
foreign laws and accounting requirements, and any sale
transaction would be effected for a consideration equal to the
book value of the Equity Securities of the Non-utility Company
being sold. Entergy will report on the completion of each such
transaction in the next quarterly certificate filed pursuant to
Rule 24 in this File, as described below. Entergy further
requests that the Commission reserve jurisdiction over
consolidations or other reorganizations of Entergy's direct or
indirect ownership interests in any Non-utility Companies, the
acquisition of the securities of which is not exempt from the Act
or authorized by the Commission under the Act, pending completion
of the record.
In addition, Entergy hereby requests an extension for the
New Authorization Period of its existing authorization to,
directly or indirectly, organize and acquire the Equity
Securities of O&M Subs. Subsequent to such organization,
investments in O&M Subs may take the form of (1) additional
purchases of Equity Securities; (2) capital contributions or open
account advances without interest; (3) loans; (4) Guarantees of
the securities or other obligations of an O&M Sub (as authorized
by supplemental order of the Commission, dated August 21, 2000
(HCAR No. 27216) in this File); or (5) any combination of the
foregoing. O&M Subs are direct or indirect special purpose
subsidiary companies of Entergy offering various operations and
maintenance services (hereinafter "O&M Services") to or for the
benefit of developers, owners and operators of domestic and
foreign power projects and other electric utility systems or
facilities, including projects that Entergy may develop on its
own (through an associate Non-utility Company) or in
collaboration with third parties. O&M Services would continue to
include, but not be limited to, development, engineering, design,
construction and construction management, pre-operational
startup, testing, and commissioning, long-term operations and
maintenance, fuel procurement, management and supervision,
technical and training, administrative support, market analysis,
consulting, coordination and any other managerial, technical,
administrative or consulting services required in connection with
the business of owning or operating facilities used for the
generation, transmission or distribution of electric energy
(including related facilities for the production, conversion,
sale or distribution of thermal energy) or coordinating their
operations in the power market.4 An O&M Sub may also lease all or
a portion of the facilities with respect to which it is providing
O&M Services. However, an O&M Sub will not undertake to enter
into such leases without further approval of the Commission if,
as a result thereof, such O&M Sub would become a "public-utility
company" as defined in the Act.
To the extent such transactions are not exempt from the Act
or otherwise authorized or permitted by rule, regulation or order
of the Commission issued thereunder, Entergy specifically
requests additional authorization to, directly or indirectly,
make initial investments in the Equity Securities of New
Subsidiaries or O&M Subs during the New Authorization Period up
to an aggregate amount of $750 million (the "Aggregate
Authorization").
Pursuant to the June 1999 Order, New Subsidiaries and O&M
Subs (as well as other Non-utility Companies) are authorized,
from time to time, (i) to provide other associate Non-utility
Companies with Administrative Services, (ii) to provide
Consulting Services to other associate Non-utility Companies and
to non-associate companies, and (iii) to engage in Development
Activities. Administrative Services include, for example,
corporate and project development and planning, management,
administrative, employment, tax, legal, accounting, engineering,
consulting, marketing, utility performance, and electronic data
processing services, and intellectual property development,
marketing and other support services. Development Activities
include, for example, investigating sites, research, engineering
and licensing activities, acquiring options and rights, contract
drafting and negotiation, legal, accounting and financial
analysis, preparing and submitting bids and proposals, and other
activities necessary to identify and analyze investment
opportunities on behalf of Entergy System companies (other than
Entergy's domestic retail electric utility companies or other
regulated businesses (collectively, the "Excepted Companies")5).
Consulting Services include, for example, providing System
developed technical capabilities and expertise to Non-utility
Companies and to non associate companies, primarily in the areas
of electric power generation, transmission and distribution and
operations ancillary thereto.6 (Administrative Services,
Development Activities and Consulting Services are collectively
referred to herein as "Other Services").
To the extent not otherwise exempt pursuant to rule,
regulation or order of the Commission, pursuant to the June 1999
Order, Non-utility Companies are authorized to provide such
"Other Services" to associate Non-utility Companies, and O&M
Subs are authorized to provide O&M Services to associate Non-
utility Companies, in either case, from time to time on a basis
other than "at cost", if one or more of the following conditions
shall apply:
(1) such associate Non-utility Company is a FUCO or is a EWG
that derives no part of its income, directly or indirectly, from
the generation and sale of electric energy within the United
States;
(2) such associate Non-utility Company is an EWG that sells
electricity at market-based rates which have been approved by the
FERC or the appropriate state public utility commission, provided
that the purchaser is an Excepted Company;
(3) such associate Non-utility Company is a "qualifying
facility" ("QF") under the Public Utility Regulatory Policies Act
of 1978, as amended ("PURPA") that sells electricity exclusively
at rates negotiated at arm's length to one or more industrial or
commercial customers purchasing such electricity for their own
use and not for resale, or to an electric utility company (other
than an Excepted Company) at the purchaser's "avoided cost"
determined in accordance with the regulations under PURPA; or
(4) such associate Non-utility Company is an EWG or a QF that
sells electricity at rates based upon its cost of service, as
approved by the FERC or any state public utility commission
having jurisdiction, provided that the purchaser of such
electricity is not an Excepted Company.
In addition to the foregoing, Non-utility Companies are also
authorized, pursuant to the June 1999 Order, to provide Other
Services on a basis other "at cost" (i) to partially owned
associate Non-utility Companies, provided that the ultimate
purchaser of such Other Services is not an Excepted Company, and
(ii) to any associate Non-Utility Company (a) that is engaged
solely in the business of developing, owning, operating and/or
providing Other Services to such partially owned associate Non-
utility Companies or to the associate Non-utility Companies
described in clauses (1) - (4) above, or (b) that does not
derive, directly or indirectly, any material part of its income
from sources within the United States and is not a public utility
company operating within the United States.
Entergy proposes that Non-utility Companies continue to
provide "Other Services" to Non-utility Companies and/or non-
associate companies, as applicable. Entergy further proposes
that Non-utility Companies continue to provide Other Services to
Non-utility Companies, and that O&M Subs continue to provide O&M
Services to Non-utility Companies, on a basis other than "at
cost", subject to the terms and conditions set forth above and
in the June 1999 Order.
To the extent that any Non-utility Company utilizes the
expertise or resources of an Excepted Company in connection with
the performance of Other Services or O&M Services, such expertise
or resources shall continue to be provided in a manner consistent
with the terms and conditions set forth in the Commission's June
22, 1999 order (HCAR No. 27040) in File No. 70-8529 (the
"Settlement Agreement Order").7
B. Issuance of Securities.
To the extent such transactions are not exempt from the Act
or otherwise authorized or permitted by rule, regulation or order
of the Commission issued thereunder, Entergy also requests an
extension of its existing authorization for Non-utility Companies
to issue and/or sell equity or debt securities, including common
stock, LLC member interests, partnership and limited partnership
interests, preferred stock or other preferred or equity-linked
securities (collectively, "preferred securities"), short-term
debt securities, such as promissory notes or commercial paper,
and long-term debt securities (collectively, "Other Securities")
to Entergy, to other Non-utility Companies or to non-associate
companies, including banks, insurance companies, and other
financial institutions.8 Entergy proposes that Other Securities
be issued and sold by Non-utility Companies to Entergy, to other
Non-utility Companies or to non-associate companies pursuant to
the authorization requested herein in one or more transactions
from time to time during the New Authorization Period.
Such Other Securities will be subject to the following
financing parameters:
(1) The effective cost of money on long-term debt borrowings
will not exceed the greater of (i) 500 basis points over the
comparable-term U.S. Treasury securities or (ii) a gross spread
over U.S. Treasuries that is consistent with similar securities
of comparable credit quality and maturities issued by other
companies.
(2) The effective cost of money on short-term debt borrowings
will not exceed the greater of (i) 500 basis points over the
comparable-term London Interbank Offered Rate ("LIBOR") or (ii) a
gross spread over LIBOR that is consistent with similar
securities of comparable credit quality and maturities issued by
other companies.
(3) The dividend rate on any series of preferred securities will
not exceed the greater of (i) 500 basis points over the yield to
maturity of a U.S. Treasury security having a remaining term
equal to the term of the series of preferred securities or (ii) a
rate that is consistent with similar securities of comparable
credit quality and maturities issued by other companies.
Also, in the case of the issuance of any Other Securities that
involve loans by Entergy or a Non-Utility Company to a Non-
utility Company at interest rates and maturities designed to
provide a return to the lending company in excess of its
effective cost of capital, the borrowing Non-utility Company will
not provide any services to any associate Non-utility Company
except a company which meets one of the conditions for the
rendering of services on a basis other than "at cost", as
described above and in the June 1999 Order.
In the event any Other Securities are issued, Entergy will
include in the next certificate filed pursuant to Rule 24 in this
File substantially the same information as that required on Form
U-6B-2 with respect to such transaction.9 In addition, the
outstanding principal amount of any such Other Securities that
are issued during the New Authorization Period will be included
in the $750 million Aggregate Authorization requested herein.
The net proceeds from the issuance and sale of Other
Securities would be used for general corporate purposes,
including without limitation (1) for loans to and/or equity
investments in Non-utility Companies; (2) for the repayment,
refinancing or redemption of outstanding securities of Entergy or
Non-utility Companies originally issued for purposes of acquiring
interests in Non-utility Companies or providing funds for the
authorized or permitted business activities of such companies;
and (3) for working capital or other cash requirements of Non-
utility Companies, provided that such net proceeds will only be
applied to finance activities that are exempt under the Act or
are otherwise authorized or permitted by rule, regulation or
order of the Commission issued thereunder, and provided further,
that at the time of issuance of any Other Securities authorized
by the Commission herein that are recourse to Entergy, directly
or indirectly, the proceeds of which are to be used to invest in
any Exempt Project, Entergy will be in compliance with Rule 53
(as modified by order of the Commission, dated June 13, 2000
(HCAR No. 27184)).10
Entergy represents and agrees that no System operating
company will incur any indebtedness, extend any credit, or sell
or pledge its assets, directly or indirectly, to or for the
benefit of any Non-utility Company, and that any Other Securities
that may be issued by a Non-utility Company, and any Guarantees
that may be issued by Entergy or a Non-utility Company, will not
be recourse to any System operating company.
C. Payment of Dividends.
To the extent such transactions are not exempt from the Act
or otherwise authorized or permitted by rule, regulation or order
of the Commission issued thereunder, Entergy requests
authorization under Section 12(c) of the Act and Rule 46
thereunder to extend (from December 31, 2002 to December 31,
2005), the period through which Non-utility Companies (including
without limitation Varibus Oil and Gas LLC (formerly, Varibus
Corporation), GSG&T, Inc., Southern Gulf Railway Company and
Prudential Oil and Gas LLC (formerly Prudential Oil and Gas,
Inc.), each of which is a direct, wholly-owned subsidiary of
Entergy Gulf States) may, from time to time, declare and pay
dividends to their respective immediate parent companies out of
capital or unearned surplus (to the extent permitted under
applicable corporate law and any applicable financing agreement
which restricts distributions to shareholders).
The payment by Non-utility Companies of dividends out of
capital or unearned surplus will not contravene the intent of
Section 12(c) of the Act. Permitting the use of distributable
cash to pay dividends ultimately to Entergy will benefit the
Entergy System by enabling Entergy to reduce or refinance
outstanding borrowings and fund operations of Entergy System
companies. The payment of dividends out of capital or unearned
surplus will not be detrimental to the financial integrity of the
Entergy System or jeopardize the working capital of any of the
Excepted Companies (including any public-utility subsidiary
company of Entergy) since the original source of such dividends
would be distributable cash derived exclusively from Entergy's
investments in Non-utility Companies.
II. Compliance With Rules 53 and 54.
Entergy hereby represents that, pursuant to Rule 54 under
the Act, all of the criteria of
Rule 53(a) and (b) are satisfied. For purposes of Rule 53(a)(1),
Entergy's aggregate investment in Exempt Projects as of March 31,
2002 (approximately $1.74 billion) was approximately 48.81% of
Entergy's consolidated retained earnings as of March 31, 2002.
Furthermore, Entergy has complied, and will continue to comply,
with the record keeping requirements of Rule 53(a)(2), with the
limitation in Rule 53(a)(3) on the use of System operating
company personnel in rendering services to Exempt Projects, and
with the requirements of Rule 53(a)(4) concerning the submission
of certain filings and reports under the Act to retail regulatory
commissions. Finally, none of the circumstances described in
Rule 53(b) has occurred."
SIGNATURES
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned companies have duly caused
this amendment to be signed on their behalf by the undersigned
thereunto duly authorized.
ENTERGY CORPORATION
ENTERGY ENTERPRISES, INC.
ENTERGY NUCLEAR, INC.
ENTERGY OPERATIONS SERVICES, INC.
ENTERGY GLOBAL POWER OPERATIONS
CORPORATION
ENTERGY POWER OPERATIONS U.S., INC.
By: /s/ Steven C. McNeal
Steven C. McNeal
Vice President and Treasurer
ENTERGY POWER, INC.
By: /s/ Steven C. McNeal
Steven C. McNeal
Treasurer
Dated: November 15, 2002
_______________________________
1 See Entergy Corporation et al., Holding Company Act Release
("HCAR") No. 27039 (June 22, 1999).
2 The Authorized Subsidiary Companies currently consist of
Entergy Enterprises, Inc.; Entergy Power, Inc.; Entergy
Nuclear, Inc.; Entergy Nuclear Operations, Inc.; Entergy
Operations Services, Inc.; Entergy Global Power Operations
Corporation; Entergy Power Operations U.S., Inc.; Entergy
Nuclear Fuels Company; Entergy Shaw, LLC; EN Services, LP and
Gulf South Pipeline, LP.
3 The June 1999 Order authorized Entergy and its Non-utility
Companies to engage in such financing transactions, as well as
to issue guarantees or provide other forms of credit
enhancement (collectively, "Guarantees") to or for the benefit
of Non-utility Companies, in an aggregate amount (together
with the amount of any initial investments in the Equity
Securities, as hereinafter defined, of New Subsidiaries and
O&M Subs) not to exceed $750 million through December 31,
2002. By supplemental order of the Commission, dated August
21, 2000 (HCAR No. 27216) in this File, Entergy and its Non-
utility Companies were subsequently authorized to issue
Guarantees to, or for the benefit of Non-utility Companies,
from time to time through December 31, 2005, in an aggregate
principal not to exceed $2 billion at any one time
outstanding. Accordingly, Applicants do not seek a renewal of
such Guaranty authority at this time.
4 Except for consulting services that may be required in
connection with the business of owning or operating such
facilities or coordinating their operations in power markets,
O&M Subs will not otherwise be engaged in the provision of
"Consulting Services" ( as hereinafter defined) to associate
and non-associate companies.
5 The "Excepted Companies" include the Entergy System's five
domestic retail electric utility companies (Entergy Arkansas,
Inc., Entergy Gulf States, Inc., Entergy Louisiana, Inc.,
Entergy Mississippi, Inc., and Entergy New Orleans, Inc.
(collectively, the "System operating companies")), System
Energy Resources, Inc., System Fuels, Inc. Entergy Services,
Inc., Entergy Operations, Inc. and any other subsidiaries that
Entergy may create, the activities and operations of which are
primarily related to the domestic sale of electric energy at
retail (exclusive of Non-utility Companies) or at wholesale to
Entergy's affiliates or the provision of goods or services
thereto.
6 For example, Consulting Services could include the provision
of (1) management expertise and services, such as strategic
planning, feasibility studies, organization and policy
matters; (2) technical expertise and services, such as design
engineering, availability engineering, construction management
planning and procedures, financial planning, system planning
and operational planning; (3) operating expertise,
particularly in the operation and maintenance of generating
plants, transmission, distribution and telecommunication
facilities; (4) environmental expertise, such as environmental
licensing and compliance, negotiation of federal, state, local
and foreign governmental permits and environmental planning;
(5) training expertise and services, particularly in the area
of operations and management; (6) technical and procedural
resources, such as are embedded in computer systems, programs
and manuals; (7) expertise in fuel procurement, delivery and
storage; (8) expertise relating to the marketing and brokering
of energy commodities; and (9) demand side management or other
energy management consulting services. Consulting Services
may include the marketing to non associate companies of
intellectual property developed or otherwise acquired by
System companies, subject to the profit sharing provisions set
forth in certain settlement arrangements that Entergy entered
with certain of its state and local regulators in 1992, 1993
and 1998.
7 In accordance with settlement arrangements that Entergy
entered into with certain of its state and local regulators in
1992, 1993 and 1998 (collectively, the "Settlement
Agreement"), Entergy agreed, subject to the receipt of
Commission approval in File No. 70-8529, to implement special
pricing provisions relating to certain transfers of services
between Excepted Companies and Entergy's non-utility
businesses. To the extent that any of the transactions
described herein would involve transfers to which the
provisions of the Settlement Agreement would apply, the
Applicants agree that such transactions will be subject to,
and performed in compliance with, such applicable provisions
and the Settlement Agreement Order with respect thereto.
Entergy has accounted for services between Excepted Companies
and Entergy's non-utility businesses to which such pricing
provisions apply.
8 Issuances of securities generally are not subject to prior
Commission approval under the Act pursuant to Rule 52(b),
provided that the conditions of the rule are satisfied,
including that the interest rate and maturity date of debt
securities that are issued to associate companies are designed
to parallel the effective cost of capital of the lending
company. Under certain circumstances, however, it may be
desirable for Entergy or a Non-utility Company to make a loan
to a Non-utility Company at a rate of interest or with a
maturity that does not provide a return equivalent to the
lending company's cost of capital.
9 If an Energy-related Company issues Other Securities, it will
also report such issuance to the Commission as required under
Form U-9C-3.
10 In addition, to the extent such action is not exempt from the
Act or otherwise authorized or permitted by rule, regulation
or order of the Commission issued thereunder, Entergy requests
that Non-utility Companies be permitted to modify the terms of
their charters or other governing documents ("Charter
Amendments") as necessary to effectuate the issuance of Other
Securities. Entergy would describe the general terms of any
Charter Amendment in the next quarterly certificate filed with
the Commission pursuant to Rule 24 in this File.