[Federal Register Volume 61, Number 178 (Thursday, September 12, 1996)]
[Notices]
[Pages 48177-48179]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-23351]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26568]
Filings Under the Public Utility Holding Company Act of 1935, As
Amended (``Act'')
September 6, 1996.
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 September 30, 1996, to the Secretary, Securities and
Exchange Commission, Washington, DC 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 the 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.
Northeast Utilities, et al. (70-8895)
Northeast Utilities, 174 Brush Hill Avenue, West Springfield,
Massachusetts 01090-0010, a registered holding company, and five
subsidiary companies, The Connecticut 06037, Western Massachusetts
Electric Company, 174 Brush Hill Avenue, West Springfield,
Massachusetts 01090-0010, Public Service Company of New Hampshire, 1000
Elm Street, Manchester, New Hampshire 03101, North Atlantic Energy
Corporation (``NAEC''), 1000 Elm Street, Manchester, New Hampshire
03101 and Holyoke Water Power Company, 1 Canal Street, Holyoke,
Massachusetts 01040, have filed an application-declaration under
sections 6(a), 7, 9(a) and 10 of the Act and rule 54 thereunder.
The applicants request authority to enter into, and perform the
obligations arising under, agreements for various interest rate
management instruments, including interest rate swaps, caps, floors,
collars and forward rate agreements or any other similar instruments
(``Interest Rate Management Instruments'' or ``IRMI''), from time to
time through the period ending December 31, 2001, in connection with
existing and future debt. The applicants propose that the term of the
IRMI would not exceed the maximum maturity of the underlying debt or
the maturity of anticipated specific future debt issuances,
proportionate to the amount of debt at each maturity level.
Each applicant, other than NAEC, undertakes that the total notional
principal amount of its IRMI will not exceed 25% of its total
outstanding debt at any one time. NAEC would make the identical
undertaking, but subject to a 65% debt limitation. In no case would the
notional principal amount of any IRMI exceed that of the underlying
debt instrument and related interest rate exposure.
Each applicant would enter into IRMI transactions with each
proposed counterparty pursuant to a separate written agreement. The
applicants will enter into IRMI with counterparties whose senior
secured debt ratings, as published by Standard & Poor's Corporation
(``S&P''), are greater than or equal to ``BBB+'' or an equivalent
rating from another rating agency, and at least 75% of the outstanding
principal amount of IRMI will be held by counterparties with S&P credit
ratings of ``A'' or higher, or an equivalent rating.
[[Page 48178]]
New England Electric System (70-8901)
New England Electric System (``NEES''), 25 Research Drive,
Westborough, Massachusetts 01582, a registered holding company, has
filed an declaration under sections 6(a) and 7 of the Act and rule 54
thereunder.
NEES proposes to issue and sell up to a maximum aggregate
outstanding principal amount of $100 million of short-term notes to
banks from time-to-time through October 31, 2001. The notes will mature
in less than one year from the date of issuance. NEES will negotiate
with banks the interest costs of such borrowings. The effective
interest cost of borrowings will not exceed the effective interest cost
of borrowings at the greater of the bank's base or prime lending rate,
or the rate published by the Wall Street Journal as the high federal
funds rate plus, in either case, 1%. NEES pays fees to the banks in
lieu of compensating balance arrangements. Certain of the borrowings
may be without prepayment privileges. Based upon the current base
lending rate of 8.25% and an equivalent or lower federal funds rates,
the effective interest cost would not exceed 9.25% per annum.
NEES currently does not expect to incur short-term borrowings under
this authority. However, NEES believes the requested authority in
necessary in order for it to act quickly in response to an emergency
affecting it or more or more of its subsidiaries.
Entergy Corporation (70-8903)
Entergy Corporation (``Entergy''), 639 Loyola Avenue, New Orleans,
Louisiana 70113, a registered holding company, has filed a declaration
under sections 6(a) and 7 of the Act and rule 53 thereunder.
By prior Commission order (HCAR No. 26343; July 27, 1995), Entergy
was authorized to enter into a credit agreement with one or more banks
to effect borrowings and reborrowings from time-to-time, for a period
not to exceed three years, in an aggregate principal amount outstanding
at any one time not to exceed $300 million. Entergy was to use the
proceeds of the credit agreement for general corporate purposes,
including the acquisition of the outstanding common stock and
investments in``exempt wholesale generators'' (``EWGs'') and ``foreign
utility companies'' (``FUCOs''), as those terms are respectively
defined in sections 32 and 33 of the Act, and related non-utility
businesses, subject to any required Commission approvals.
Entergy entered into a $300 million credit agreement (``Credit
Agreement''), dated as of October 10, 1995, among Entergy, as borrower,
certain banks named therein as lender banks, and Citibank, N.A., as
agent. The indebtedness currently outstanding under the Credit
Agreement is approximately $270 million, which was drawn to complete
the acquisition of CitiPower Limited.
Entergy now proposes to enter into an amendment, modification or
supplement of the Credit Agreement and/or one or more additional credit
facilities (collectively, ``Credit Facilities'') with one or more banks
that would permit Entergy to effect borrowings and reborrowings, from
time-to-time no later than December 31, 2002, of not more than $500
million at any one time outstanding, by issuing to participating banks
(``Banks'') its unsecured promissory notes payable no later than
December 31, 2002. The names of the Banks, the maximum amount of the
aggregate commitment of such Banks, (which will not exceed $500,
million and the maximum amounts of their respective participations
(collectively, the ``Commitments'') in the proposed borrowings by
Entergy will be supplied by filing under rule 24.
Entergy proposes that each borrowing could either be made pro rata
among the Banks according to their respective Commitments, or be
allocated among one or more of the Banks in such proportions as the
Banks and Entergy shall agree. Each payment by Entergy with respect to
a borrowing would be made pro rata among the Banks according to their
respective ratable portions of such borrowings. The Commitments would
remain in effect until no later than December 31, 2002, subject to the
right of Entergy at any time upon proper notice to terminate the
Commitments or from time-to-time to reduce the Commitments then in
effect. Any such reduction of the Commitments would be accompanied by
prepayment of the outstanding borrowings and accrued interest to the
extent that the aggregate principal amount then outstanding exceeded
the reduced Commitments of the Banks.
Under the proposed arrangements, each borrowing would bear interest
from the date thereof on the unpaid principal amount at a rate per
annum selected by Entergy, from time-to-time, from a number of
specified interest rate options. Such interest rate options will
include but not be limited to some or all of the following: (1) The
prime commercial loan rate of a specified Bank (or an average of such
rates of some or all of the Banks) (``Prime Rate'') from time-to-time
in effect; (2) the sum of (A) specified offered rates for certificates
of deposit of a specified Bank (or an average of such rates of some or
all of the Banks) for amounts equivalent to such borrowing and for
selected interest periods, appropriately adjusted for the cost of
reserves and F.D.I.C. insurance and (B) a margin not in excess of 1%
per annum (``CD Rate''); (3) the sum of (A) specified rates offered for
U.S. dollar deposits by or to a specified Bank (or an average of such
rates of some or all of the Banks) in the interbank eurodollar market
for amounts equivalent to such borrowing and for selected interest
periods, appropriately adjusted for the cost of reserves and (B) a
margin not in excess of 1% per annum (``LIBOR Rate''); or (4) a rate
negotiated at the time of borrowing with one or more Banks, which would
not in any event exceed a maximum rate of the Prime Rate plus 2% per
annum, appropriately adjusted for the cost of bidding or negotiation
(``Auction Advance Rate'').
In general, interest on Prime Rate borrowings would be payable
quarterly, and interest on CD Rate and LIBOR Rate borrowings would be
payable at the end of selected interest periods for such borrowings,
or, depending upon the length of such selected interest periods, at
specified intervals within such periods and at the end of such periods.
Interest on Auction Advance Rate borrowings would be payable on such
dates as are agreed to by Entergy and Banks funding such borrowings.
Entergy has stated that it may agree to pay to each Bank a facility
fee for the period from the commencement of the borrowing arrangements
to and including December 31, 2002, or any earlier date of termination
of the Commitments, computed at a rate not in excess of \1/4\ of 1% per
annum of the total Commitments in effect during the period for which
payment is made. Entergy may also agree to pay to the agent Bank, if
any, an agent fee for the period from the commencement of the borrowing
arrangements to and including December 31, 2002, or any earlier date of
termination of the Commitments, not in excess of $200,000 per annum.
The facility fee and agent fee would be payable on an annual or a
quarterly basis and on the date upon which Entergy shall terminate the
Commitments. Entergy may also agree to pay to the Banks an up-front fee
not in excess of 1% of the total Commitments.
Entergy presently intends to repay the proposed borrowings out of
internally generated funds and/or the proceeds of such forms of
financing as are hereafter approved by the Commission and/or other
funds that become available to Entergy. The proposed borrowings
[[Page 48179]]
would be prepayable upon proper notice in whole or in part.
The proceeds of the borrowings under the proposed arrangements will
be used by Entergy for general corporate purposes, including, among
other things: (1) The acquisition of shares of Entergy's outstanding
common stock; (2) further investments by Entergy in related non-utility
businesses, subject to receipt of any further Commission approval, if
necessary, under the Act in separate filings made at an appropriate
time, and (3) investments in existing or future exempt wholesale
generators and foreign utility companies as permitted by sections 33
and 34 of the Act or otherwise approved by the Commission.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-23351 Filed 9-11-96; 8:45 am]
BILLING CODE 8010-01-M
