[Federal Register Volume 62, Number 232 (Wednesday, December 3, 1997)]
[Notices]
[Pages 63996-63997]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-31618]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26785]
Filings Under the Public Utility Holding Company Act of 1935, as
Amended (``Act'')
November 25, 1997.
Notice is hereby given that the following filing(s) has/have been
made with the Commission pursuant to provisions of the Act and rules
promulgated thereunder. All interested persons are referred to the
application(s) and/or declaration(s) for complete statements of the
proposed transaction(s) summarized below. The application(s) and/or
declaration(s) and any amendments thereto is/are available for public
inspection through the Commission's Office of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in
writing by December 18, 1997, to the Secretary, Securities and Exchange
Commission, Washington, D.C. 20549, and serve a copy on the relevant
applicant(s) and/or declarant(s) at the address(es) specified below.
Proof of service (by affidavit or, in case of an attorney at law, by
certificate) should be filed with request. Any request for hearing
shall identify specifically the issues of fact or law that are
disputed. A person who so requests will be notified of any hearing, if
ordered, and will receive a copy of any notice or order issued in the
matter. After said date, the application(s) and/or declaration(s), as
filed or as amended, may be granted and/or permitted to become
effective.
Central and South West Corporation, et al.
[70-9113]
Central and South West Corporation (``CSW''), a registered holding
company, 1616 Woodall Rodgers Freeway, Dallas, Texas 75202, and its
wholly-owned service company subsidiary, Central and South West
Services, Inc. (``CSW Services''), 212 East 6th Street, Tulsa, Oklahoma
74119, have filed an application-declaration under sections 6(a), 7,
9(a), 10, 12(c) and 13(b) of the Act and rules 42, 54 and 87-91
thereunder.
CSW owns all of the outstanding shares of common stock of four
public utility subsidiaries (collectively, ``Operating Companies''):
Central Power and Light Company, Public Service Company of Oklahoma,
Southwestern Electric Power Company, and West Texas Utilities Company.
Together, these Operating Companies provide electric service to
approximately 1.7 million customers in a widely diversified area
covering 152,000 square miles in portions of Arkansas, Louisiana,
Oklahoma and Texas.\1\
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\1\ CSW also has numerous nonutility subsidiaries, including CSW
Energy, Inc., which develops and operates independent power and
cogeneration projects; CSW International, Inc., which pursues
investments in energy ventures internationally, and which,
indirectly, owns all the outstanding share capital of SEEBOARD
p.l.c., one of 12 regional electricity companies in the United
Kingdom; CSW Credit, Inc., which purchases the accounts receivable
of the Operating Companies and certain non-affiliated electric
utilities; CSW Communications, Inc., which provides communication
services to the Operating Companies and certain non-affiliates; CSW
Leasing, Inc., which invests in leveraged leases; EnerShop, Inc.,
which provides energy management services; and CSW Services, which
performs, at cost, various accounting, engineering, tax, legal,
financial electronic data processing, centralized economic
dispatching of electric power and other services to CSW and its
subsidiaries.
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CSW requests authorization to adopt and implement a stockholder
rights plan (``Rights Plan'') under which CSW's Board of Directors
(``Board'') would declare a dividend of one right (``Right'') for each
outstanding share of CSW Common Stock, par value $3.50 per share
(``Common Stock''), payable to stockholders of record on a date to be
established (``Record Date'').\2\ The Rights will be created by and
issued under a rights agreement (``Rights Agreement'') to be entered
into by CSW and CSW Services, as Rights Agent.\3\ The Rights created
under the proposed Rights Agreement would entitle the holders to
purchase one-tenth of a share of Common Stock at a price of $50 per
whole share of Common Stock, subject to adjustment (Purchase
Price'').\4\ This is equivalent to $5 per one-tenth of one share of
Common Stock. CSW states that
[[Page 63997]]
the Purchase Price represents the Board's estimation of the long-term
value of the Common Stock. The Board has adopted and approved the
Rights Agreement subject to the receipt of an appropriate order from
the Commission in this filing. Upon receipt of such an order, the
Rights will be distributed as a dividend to the holders of CSW's
outstanding shares of Common Stock.\5\
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\2\ As of June 30, 1997 there were 212,235,310 shares of Common
Stock outstanding.
\3\ The services of CSW Services, as Rights Agent, will be
provided at cost. CSW expects that such charges, if any, will be de
minimis. As Rights Agent, CSW Services practically has no active
duties unless the Rights become, if ever, exercisable, at which time
the Rights Agent performs or causes to be performed services similar
to a stock transfer agent. CSW Services is the transfer agent for
the Common Stock.
\4\ The Purchase price payable, and the number of shares of
Common Stock (or other securities or property, as the case may be)
issuable upon exercise of the Rights are subject to adjustment from
time to time to prevent dilution. Prior to the date on which the
Rights become exercisable, the Board may make such equitable
adjustments as it deems appropriate in the circumstances in lieu of
any adjustment otherwise required by the foregoing. No adjustment in
the Purchase Price will be required until the time at which
cumulative adjustments require an adjustment of at least 1% in the
Purchase Price. No fractional shares of Common Stock will be issued
and, in lieu thereof, a cash payment will be made based on the
market price of the Common Stock on the last trading day prior to
the date of exercise.
\5\ Any of the provisions of the Rights Agreement may be amended
by the Board without the consent of the holders of the Rights;
provided, however, that on or after the Distribution Date (as
defined below), the Rights Agreement may not be amended in any
manner that would adversely affect the interests of the holders of
the Rights.
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Initially, the Rights would not be exercisable and would trade as
an integral part of the outstanding shares of Common Stock. Subject to
certain rights of CSW to redeem \6\ or exchange shares of Common Stock
for \7\ the Rights, the Rights would become exercisable (i.e., Common
Stock could be purchased at the Purchase Price pursuant to the Rights)
and Rights Certificates representing the Rights would be distributed
and would trade independently of the outstanding shares of Common Stock
upon the occurrence of the following triggering events (``Triggering
Events''): the earlier to occur of (i) 10 days after the first public
announcement that any person or group (``Acquiring Person'') has
acquired beneficial ownership of 15% or more of CSW's outstanding
Common Stock (``Acquisition Event'') and (ii) 10 business days (unless
extended by the Board of Directors) after any person or group has
commenced a tender or exchange offer which would, upon its
consummation, result in such person or group becoming an Acquiring
Person (``Offer Event'') (the earlier of (i) and (ii) is hereafter
referred to as the ``Distribution Date'').
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\6\ The Rights may be redeemed, as a whole, at a Redemption
Price of $.01 per Right, subject to adjustment, at the direction of
the Board, at any time prior to the earlier of: (i) 10 days after
the first public announcement that any person has become an
Acquiring Person (as defined below); and (ii) the date of final
expiration of the Rights. The Rights will expire on the tenth
anniversary of the Record Date, unless earlier redeemed or exchanged
by CSW.
\7\ At any time after any person or group shall have become an
Acquiring Person and before any person (other than CSW and certain
related entities), together with its affiliates and associates,
shall have become the beneficial owner of 50% or more of the
outstanding shares of Common Stock, the Board may direct the
exchange of shares of Common Stock for all or any part of the Rights
(other than Rights of an Acquiring Person which become void) at the
exchange rate of one share of Common Stock per Right, subject to
adjustment.
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When the Triggering Event is an Acquisition Event, the holders of
the Rights (other than an Acquiring Person and certain transferees
thereof whose Rights will become void) would immediately have the right
to receive, for each Right exercised, Common Stock having a market
value equal to two times the Purchase Price then in effect (``Discount
Purchase Right''). When the Triggering Event is an Offer Event, the
holders of the Rights (other than an Acquiring Person and certain
transferees thereof whose Rights will become void) would be entitled to
the Discount Purchase Right once a person or group commencing the
tender or exchange offer becomes an Acquiring Person.
In the event that, on or after the Distribution Date: (i) CSW is
acquired by another person or entity not controlled by CSW
(``Acquiror'') in a merger or other business combination transaction in
which CSW Common Stock is exchanged for securities or other property;
or (ii) 50% or more of CSW's consolidated assets or earnings power is
sold or transferred to an Acquiror, each holder of a Right (except
Rights which previously have been voided as discussed above) will
thereafter be entitled to receive, for each Right exercised, common
stock of the Acquiror having a market value equal to two times the
Purchase Price then in effect.
CSW states that the proposed Rights Plan is intended to deter
hostile takeover attempts and/or attempts to acquire CSW in a manner or
on terms which the Board determines are not in the best interests of
all stockholders by enabling the Board to provide CSW stockholders with
adequate time to assess properly a takeover bid without undue pressure.
The Rights Plan is also intended to confront a potential acquiror with
the possibility that the exercise of Rights by stockholders will
substantially increase the number of shares of Common Stock outstanding
and therefore the cost of acquiring control of CSW. CSW states that the
Rights Plan will operate to maximize and preserve the value of CSW for
its stockholders, in the event of an attempted hostile or unwanted
takeover, but is not designed to prevent a proxy contest to replace
members of the Board or frustrate a fair offer for the entire company
which is in the best interests of stockholders.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-31618 Filed 12-2-97; 8:45 am]
BILLING CODE 8010-01-M
