PROSPECTUS SUPPLEMENT
Filed pursuant to Rule 424(b)(2)
(To Prospectus dated December 11, 2003)
Registration No. 333-110675
$100,000,000
ENTERGY MISSISSIPPI, INC.
First Mortgage Bonds, 5.92% Series due
February 1, 2016
We are offering $100 million of our First
Mortgage Bonds, 5.92% Series due February 1, 2016 (the
“bonds”). We will pay interest on the bonds on
February 1 and August 1 of each year. The first
interest payment on the bonds will be made on August 1,
2006. The bonds will be redeemable at our option, in whole or in
part, (i) at any time prior to February 1, 2011, at
the make-whole redemption price described in this prospectus
supplement, and (ii) at any time on or after
February 1, 2011, prior to maturity of the bonds, at a
redemption price equal to 100% of the principal amount of the
bonds being redeemed plus, in each case, accrued and unpaid
interest thereon to the redemption date.
The bonds will be issued in denominations of
$1,000 and integral multiples thereof. As described in the
accompanying prospectus, the bonds are a series of first
mortgage bonds issued under our mortgage, which has the benefit
of a first mortgage lien on substantially all of our property.
Investing in the bonds involves risks. See
“Risk Factors” beginning on page S-3.
Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved
of these securities or determined if this prospectus supplement
or the accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
Proceeds to
Entergy
Underwriting
Mississippi
Price to
Discounts and
(before
Public
Commissions
expenses)
Per bond
99.967%
0.65%
99.317%
Total
$99,967,000
$650,000
$99,317,000
The price to public will also include any
interest that has accrued on the bonds since their issue date if
delivered after that date.
The underwriters expect to deliver the bonds to
purchasers through The Depository Trust Company on or about
January 18, 2006.
Joint Book-Running Managers
Credit Suisse First Boston
KeyBanc Capital Markets
BNP PARIBAS
January 11, 2006
You should rely only on the information
contained or incorporated by reference in this prospectus
supplement or the accompanying prospectus. We have not
authorized anyone else to provide you with different
information. You should not assume that the information
contained in this prospectus supplement, the accompanying
prospectus or the documents incorporated by reference is
accurate as of any date other than as of the dates of these
documents or the dates these documents were filed with the SEC.
We are not making an offer of the bonds in any state where the
offer is not permitted.
Table of Contents
Page
Prospectus Supplement
Risk Factors
S-3
Forward-Looking Information
S-4
Where You Can Find More Information
S-6
Selected Financial Information
S-7
Use of Proceeds
S-7
Description of the Bonds
S-8
Underwriting
S-10
Experts
S-11
Legality
S-11
Prospectus
About this Prospectus
2
Entergy Mississippi, Inc.
2
Ratios of Earnings to Fixed Charges
2
Where You Can Find More Information
2
Use of Proceeds
3
Description of the First Mortgage Bonds
3
Description of Debt Securities
6
Book-Entry Only Securities
12
Experts
14
Legality
14
Plan of Distribution
14
S-2
Risk Factors
In considering whether to purchase the bonds
being offered, you should carefully consider the information we
have included or incorporated by reference in this prospectus
supplement and the accompanying prospectus. In particular, you
should carefully consider the risk factors described below, as
well as the factors listed in “Forward-Looking
Information”.
Our results of operations, financial condition
and liquidity could be materially and adversely affected if we
fail to recover, or experience delays in recovering, storm
restoration costs incurred as a result of Hurricane
Katrina.
In August 2005, Hurricane Katrina hit our service
territory causing power outages and significant infrastructure
damage to our distribution and transmission systems. As a result
of this hurricane, we have recorded accruals for the estimated
storm restoration costs for the repair and/or replacement of our
electric facilities damaged by Hurricane Katrina and for
business continuity costs, which are currently estimated to be
in the range of $80 to $90 million. We expect that total
storm restoration costs for Hurricane Katrina will be closer to
the higher end of that range. As a result of the temporary power
outages associated with the hurricane in the affected service
territory, our receivable collections were lower than normal in
September 2005.
As of September 30, 2005, we recorded an
increase totaling $30.4 million in construction work in
progress and $46.6 million in other regulatory assets, with
a corresponding increase of $77 million in accounts
payable. In accordance with our accounting policies, and based
on historic treatment of such costs in our service territories
and communications with local regulators, we recorded these
assets because management believes that recovery through some
form of regulatory mechanism is probable. We are pursuing a
broad range of initiatives to recover storm restoration and
business continuity costs and incremental losses. Initiatives
include obtaining reimbursement of certain costs covered by
insurance, obtaining assistance through federal legislation for
Hurricane Katrina, and pursuing recovery through existing or new
rate mechanisms regulated by the Federal Energy Regulatory
Commission (“FERC”) and the Mississippi Public Service
Commission (“MPSC”). On December 20, 2005, we
made a filing with the MPSC to begin recovery of storm
restoration costs, which includes costs recorded through
November 2005 of approximately $84 million, including
approximately $5 million for costs incurred from Hurricane
Rita. If approved, the first phase of the storm recovery plan
will result in an annual rate increase of approximately
$14.7 million. This would represent an additional $1.24 per
month for a typical residential customer. If approved, this
charge will appear on bills beginning in May 2006 and continue
for five years. A second filing will likely occur in June 2006
to cover costs not included in this filing. Because we have not
completed the regulatory process regarding these storm costs,
however, there is an element of risk regarding recovery, and we
are unable to predict with certainty the degree of success we
may have in our recovery initiatives, the amount of restoration
costs and incremental losses we may ultimately recover, or the
timing of such recovery.
The consequences of Hurricane Katrina and
Hurricane Rita have negatively affected our liquidity. The
occurrence of one or more contingencies could put further
pressure on the adequacy of our liquidity and capital resources,
which could materially and adversely affect our financial
condition and results of operations, and our credit
ratings.
In addition to the storm restoration costs
discussed in the preceding risk factor, Hurricane Katrina and
Hurricane Rita affected our liquidity position in several ways.
The bankruptcy of our affiliate, Entergy New Orleans, Inc.,
caused fuel and gas suppliers to increase their scrutiny of us
with the concern that we could suffer similar impacts,
particularly after Hurricane Rita. As a result, some suppliers
began requiring accelerated payments and decreasing credit
lines. The hurricanes damaged certain gas supply lines, thereby
decreasing the number of potential suppliers. Finally, the
hurricanes exacerbated a market run up in natural gas and power
prices, thereby increasing our accounts payable to our
suppliers, which consumed available supplier credit lines more
quickly.
At the same time, the continued rapid increase in
natural gas prices has resulted in increased working capital
requirements for us while waiting for existing regulatory fuel
and purchased power recovery mechanisms to
S-3
catch up. As of September 30, 2005, we had
approximately $77.9 million of deferred fuel costs.
Although we expect to recover all of our fuel and purchased
power costs through established (or potentially modified)
regulatory recovery mechanisms, high natural gas prices and the
effect of the current cumulative deferred fuel balance will
continue to have a negative effect on our liquidity position.
Our parent company, Entergy Corporation, has
implemented an approximately $2.5 billion financing plan in
order to provide adequate liquidity and capital resources while
storm restoration cost recovery is pursued and to provide
additional financial support against the potential occurrence of
other unexpected events. This plan includes (1) a new
Entergy revolving credit facility with capacity of up to
$1.5 billion that Entergy entered into on December 7,
2005 (this facility supplements Entergy’s existing
five-year $2 billion revolving credit facility);
(2) the issuance and sale of $500 million of equity
units by Entergy on December 20, 2005; and (3) the
issuance and sale of $150 million of first mortgage bonds
by Entergy Louisiana, Inc. on October 21, 2005 and
$350 million of first mortgage bonds by Entergy Gulf
States, Inc. on December 8, 2005.
Under normal circumstances, our business is
capital intensive, and we are dependent upon our ability to
access capital at rates and on terms we determine to be
reasonable. The hurricanes and the resulting consequences on our
business have placed even greater importance on our ability to
access the capital markets to support our increased liquidity
needs. The occurrence of one or more contingencies, including
higher than estimated storm restoration costs, lower than
expected insurance recovery with respect to storm restoration
costs, or a delay in such recovery, a delay in the recovery of
storm restoration costs, a greater than expected increase in
natural gas prices, an acceleration of payments or decreased
credit lines for fuel or power supply, less cash flow from
operations than expected, or other unknown events (such as
future storms) could cause our financing needs to increase,
which may result in an increase in our leverage. Material
leverage increases could negatively affect our access to the
capital markets as well as our credit ratings, including the
ratings on the bonds.
The consequences of the hurricanes on our
financial condition, and the related uncertainty associated with
storm restoration cost recovery, together with other factors,
such as the bankruptcy filing of Entergy New Orleans, Inc. have
negatively impacted our credit profile. Following Hurricane
Katrina, Standard & Poor’s Ratings Services placed us
on credit watch with negative implications. If one or more
rating agencies were to downgrade our first mortgage bonds to
below investment grade, our borrowing costs could increase,
which could negatively affect our financial condition, results
of operations and liquidity. We would also likely be required to
pay a higher interest rate in future financings, and our
potential pool of investors and funding sources could decrease.
In addition, adverse ratings actions could prompt our fuel and
power suppliers to require us to make accelerated payments or to
reduce or eliminate credit lines or reconsider new transactions
with us.
Forward-Looking Information
In this prospectus supplement and from time to
time, we make statements concerning our expectations, beliefs,
plans, objectives, goals, strategies, and future events or
performance. Such statements are “forward-looking
statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. Although we believe that these
forward-looking statements and the underlying assumptions are
reasonable, we cannot provide assurance that they will prove
correct. Except to the extent required by the federal securities
laws, we undertake no obligation to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise.
Forward-looking statements involve a number of
risks and uncertainties, and there are factors that could cause
actual results to differ materially from those expressed or
implied in the statements. Some of those factors (in addition to
others described elsewhere in this prospectus supplement under
and in subsequent securities filings) include:
•
resolution of pending and future rate cases and
negotiations, including various performance-based rate
discussions, and other regulatory proceedings, including those
related to Entergy’s System Agreement and our utility
supply plan;
S-4
•
our ability to manage our operation and
maintenance costs;
•
the performance of our generating plants;
•
our ability to meet credit support requirements
for fuel and power supply contracts and the prices and
availability of fuel and power that we must purchase for our
utility customers;
•
changes in the financial markets, particularly
those affecting the availability of capital and our ability to
refinance existing debt and to fund investments and acquisitions;
•
actions of rating agencies, including changes in
the ratings of debt and preferred stock, changes in general
corporate ratings, and changes in the rating agencies’
ratings criteria;
•
changes in inflation, interest rates, and foreign
currency exchange rates;
•
our ability to purchase and sell assets at
attractive prices and on other attractive terms;
•
volatility and changes in markets for
electricity, natural gas, uranium, and other energy-related
commodities;
•
changes in utility regulation, including the
beginning or end of retail and wholesale competition, the
ability to recover net utility assets and other potential
stranded costs, the establishment of a regional transmission
organization that includes our service territory and the
application of market power criteria by the FERC;
•
changes in law resulting from the new federal
energy legislation, including the effects of the repeal of the
Public Utility Holding Company Act of 1935 (“PUHCA”);
•
changes in regulation of nuclear generating
facilities and nuclear materials and fuel, including possible
shutdown of nuclear generating facilities;
•
uncertainty regarding the establishment of
interim or permanent sites for spent nuclear fuel storage and
disposal;
•
changes in environmental, tax, and other laws,
including requirements for reduced emissions of sulfur,
nitrogen, carbon, mercury, and other substances;
•
the economic climate, and particularly growth in
our service territory;
•
variations in weather and the occurrence of
hurricanes and other storms and disasters, including
uncertainties associated with efforts to remediate the effects
of Hurricanes Katrina and Rita and recovery of costs associated
with restoration, including our ability to obtain financial
assistance from governmental authorities in connection with
these storms;
•
the outcome of the Chapter 11 bankruptcy
proceeding of our affiliate, Entergy New Orleans, and the
impact, if any, of this proceeding on us or any of our other
affiliated companies;
•
advances in technology;
•
the potential effects of threatened or actual
terrorism and war;
•
the effects of litigation;
•
changes in accounting standards, corporate
governance and securities law requirements; and
•
our ability to attract and retain talented
management and directors.
S-5
Where You Can Find More Information
The SEC allows us to “incorporate by
reference” the information filed by us with the SEC, which
means that we can refer you to important information without
restating it in this prospectus supplement and the accompanying
prospectus. The information incorporated by reference is
considered to be part of this prospectus supplement and the
accompanying prospectus and should be read with the same care.
We incorporate by reference our Annual Report on Form 10-K
for the year ended December 31, 2004, our Quarterly Reports
on Form 10-Q for the quarters ended March 31, 2005,
June 30, 2005 and September 30, 2005, our Current
Reports on Form 8-K dated March 17, 2005 (filed
March 17, 2005), April 15, 2005 (filed April 19,
2005), June 1, 2005 (filed June 14, 2005),
September 20, 2005 (filed September 20, 2005),
September 22, 2005 (filed September 28, 2005), and
October 19, 2005 (filed October 19, 2005), and any
future reports that we file with the SEC under the Securities
Exchange Act of 1934 if the filings are made prior to the time
that all of the bonds are sold in this offering. You may access
a copy of any or all of these filings, free of charge, at our
website (http://www.entergy.com) or by writing or calling
us at the following address:
Dawn A. Abuso
Assistant Secretary
Entergy Mississippi, Inc.
446 North Boulevard
Baton Rouge, Louisiana 70802
(225) 339-3213
You may also direct your requests via e-mail to
dabuso@entergy.com. You can also find more information about us
from the sources described under “Where You Can Find More
Information” in the accompanying prospectus.
S-6
Selected Financial Information
(Dollars in Thousands)
You should read our selected financial
information set forth below in conjunction with the financial
statements and other financial information contained in the
documents incorporated by reference. The selected financial
information set forth below has been derived from (1) our
financial statements for the three-year period ended
December 31, 2004, which have been audited by Deloitte
& Touche LLP, our independent registered public accountants,
and incorporated by reference in this prospectus supplement from
our Annual Report on Form 10-K for the fiscal year ended
December 31, 2004, and (2) our unaudited financial
statements as of September 30, 2005 and for the nine months
ended September 30, 2005, incorporated by reference in this
prospectus supplement from our Quarterly Report on
Form 10-Q for the quarterly period ended September 30,
2005.
For the Twelve Months Ended
December 31,
September 30,
2005
2004
2003
2002
Income Statement Data:
Operating Revenues
$1,243,144
$1,213,629
$1,035,360
$
991,095
Operating Income
147,209
146,614
141,647
106,766
Interest Expense (net)
40,596
41,521
43,522
41,997
Net Income
74,446
73,497
67,058
52,408
Ratio of Earnings to Fixed Charges(1)
3.52
3.41
3.06
2.48
As of September 30, 2005
Actual
As Adjusted(2)
Amount
Percent
Amount
Percent
Balance Sheet Data:
Preferred Stock
$
50,381
3.8
%
$
50,381
3.6
%
Common Stock and Paid-in Capital
198,721
15.1
198,721
14.0
Retained Earnings
371,417
28.3
371,417
26.2
Total Shareholders’ Equity
620,519
47.2
620,519
43.8
First Mortgage Bonds
650,000
49.4
750,000
53.0
Other Long-Term Debt(3)
45,128
3.4
45,128
3.2
Total Capitalization
$
1,315,647
100.0
%
$
1,415,647
100.0
%
(1)
As defined by Item 503(d) of
Regulation S-K of the SEC, “Earnings” represent
the aggregate of (a) income before the cumulative effect of
an accounting change, (b) taxes based on income,
(c) investment tax credit adjustments — net and
(d) fixed charges. “Fixed Charges” as defined by
Item 503(d) of Regulation S-K of the SEC include
interest (whether expensed or capitalized), related amortization
and estimated interest applicable to rentals charged to
operating expenses.
(2)
Adjusted to reflect the issuance and sale of the
bonds.
(3)
Consists of pollution control revenue bonds and
environmental revenue bonds, $30 million of which are
secured by non-interest bearing first mortgage bonds.
Use of Proceeds
We anticipate our net proceeds from the sale of
the bonds will be approximately $99 million after deducting
underwriting discounts and commissions and estimated offering
expenses. We will use the net proceeds from the issuance and
sale of the bonds (i) to purchase the Attala power plant
from Central Mississippi Generating Company, LLC on or about
January 20, 2006 for a purchase price of approximately
$88 million, and (ii) to repay short-term indebtedness
and borrowings under the Entergy System Money Pool (at
January 4, 2006, such indebtedness and borrowings were
approximately $86 million). Prior to the application of the
net proceeds from the sale of the bonds to purchase the Attala
power plant, we will invest
S-7
those net proceeds in short-term, highly liquid,
high rated money market instruments and/or the Entergy System
Money Pool.
Description of the Bonds
Interest, maturity and payment
We are offering $100 million of First
Mortgage Bonds, 5.92% Series due February 1, 2016. We will
pay interest on the bonds on February 1 and August 1
of each year, beginning on August 1, 2006. As long as the
bonds are registered in the name of DTC or its nominee, the
record date for interest payable on any interest payment date
shall be the close of business on the Business Day immediately
preceding such interest payment date. Interest starts to accrue
from the date that the bonds are issued or the most recent
payment date to which interest has been paid or duly provided
for.
The bonds will be issued on the basis of retired
bond credits. As of December 1, 2005, approximately
$285 million of first mortgage bonds could have been issued
on the basis of retired bond credits and approximately
$402 million could have been issued on the basis of
unfunded property.
We have agreed to pay interest on any overdue
principal and, if such payment is enforceable under applicable
law, on any overdue installment of interest on the bonds at a
rate of 6.92% per annum to holders of record at the close of
business on the Business Day immediately preceding our payment
of such interest. Interest on the bonds will be computed on the
basis of a 360-day year of twelve 30-day months. If any interest
payment date or the maturity date falls on a day that is not a
Business Day, the payment due on that interest payment date or
the maturity date will be made on the next Business Day, and
without any interest or other payment in respect of such delay.
Form and denomination
The bonds will be issued in denominations of
$1,000 and integral multiples thereof. The bonds will be
represented by a global certificate without coupons registered
in the name of a nominee of DTC. As long as the bonds are
registered in the name of DTC or its nominee, we will pay
principal, premium, if any, and interest due on the bonds to
DTC. DTC will then make payment to its participants for
disbursement to the beneficial owners of the bonds as described
in the accompanying prospectus under the heading
“Book-Entry Only Securities.”
Optional redemption
The bonds will be redeemable at our option, in
whole or in part, on not less than 30 days’ nor more
than 60 days’ notice, (i) at any time prior to
February 1, 2011, at a redemption price equal to the
greater of (a) 100% of the principal amount of the bonds
being redeemed and (b) as determined by the Independent
Investment Banker, the sum of (x) the present value of the
payment on February 1, 2011 of the principal amount of the
bonds being redeemed plus (y) the sum of the present values
of the remaining scheduled payments of interest on the bonds
being redeemed to February 1, 2011 (excluding the portion
of any such interest accrued to the redemption date), discounted
(for purposes of determining such present values) to the
redemption date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury
Rate plus 0.30%, and (ii) at any time on or after
February 1, 2011, prior to maturity of the bonds, at a
redemption price equal to 100% of the principal amount of the
bonds being redeemed, plus, in each case, accrued and unpaid
interest thereon to the redemption date.
If, at the time notice of redemption is given,
the redemption monies are not held by the corporate trustee, the
redemption may be made subject to receipt of such monies before
the date fixed for redemption, and such notice shall be of no
effect unless such monies are so received.
S-8
We may apply cash we deposit under any provision
of the mortgage, with certain exceptions, to the redemption or
purchase, including the purchase from us, of first mortgage
bonds of any series including the bonds offered by this
prospectus supplement.
Certain Definitions
“Adjusted Treasury Rate” means, with
respect to any redemption date:
(1) the yield, under
the heading which represents the average for the immediately
preceding week, appearing in the most recently published
statistical release designated “H.15(519)” or any
successor publication which is published weekly by the Board of
Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption “Treasury
Constant Maturities,” for the maturity corresponding to the
Comparable Treasury Issue (if no maturity is within three months
before or after February 1, 2011, yields for the two
published maturities most closely corresponding to the
Comparable Treasury Issue shall be determined and the Adjusted
Treasury Rate shall be interpolated or extrapolated from such
yields on a straight line basis, rounding to the nearest
month); or
(2) if such release
(or any successor release) is not published during the week
preceding the calculation date for the Adjusted Treasury Rate or
does not contain such yields, the rate per annum equal to the
semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable
Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such
redemption date.
The Adjusted Treasury Rate shall be calculated on
the third Business Day preceding the redemption date.
“Business Day” means any day other than
a Saturday or a Sunday or a day on which banking institutions in
The City of New York are authorized or required by law or
executive order to remain closed or a day on which the corporate
trust office of the corporate trustee is closed for business.
“Comparable Treasury Issue” means the
United States Treasury security selected by the Independent
Investment Banker as having a maturity comparable to
February 1, 2011 that would be utilized, at the time of
selection and in accordance with customary financial practice,
in pricing new issues of corporate debt securities of comparable
maturity to February 1, 2011.
“Comparable Treasury Price” means, with
respect to any redemption date, (i) the average of five
Reference Treasury Dealer Quotations for such redemption date
after excluding the highest and lowest such Reference Treasury
Dealer Quotations or (ii) if the Independent Investment
Banker obtains fewer than five such Reference Treasury Dealer
Quotations, the average of all such Reference Treasury Dealer
Quotations.
“Independent Investment Banker” means
one of the Reference Treasury Dealers that we appoint to act as
the Independent Investment Banker from time to time, or, if any
of such firms is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of
national standing appointed by us.
“Reference Treasury Dealer” means
(i) Credit Suisse First Boston LLC and KeyBanc Capital
Markets, a division of McDonald Investments Inc. and their
respective successors; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government
securities dealer in the United States (a “Primary
Treasury Dealer”), we will substitute therefor another
Primary Treasury Dealer, and (ii) any other Primary
Treasury Dealer selected by the Independent Investment Banker
after consultation with us.
“Reference Treasury Dealer Quotations”
means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Independent
Investment Banker, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the
Independent Investment Banker at 5:00 p.m. on the third
Business Day preceding such redemption date.
S-9
Dividend covenant
We will covenant that, so long as any bonds
remain outstanding, we will not pay any cash dividends on common
stock or purchase common stock after December 31, 2005,
unless, after giving effect to such dividends or purchases, the
aggregate amount of such dividends or purchases after
December 31, 2005 (other than dividends we have declared on
or before December 31, 2005) does not exceed credits to
earned surplus after December 31, 2005, plus
$250 million plus such additional amounts as shall be
approved by the SEC under PUHCA or by such other agency
administering similarly applicable law.
Sinking or improvement fund
The bonds are not subject to redemption under any
sinking or improvement fund.
Additional information
For additional important information about the
bonds, see “Description of the First Mortgage Bonds”
in the accompanying prospectus, including:
(1) additional information about the
terms of the bonds, including security,
(2) general information about our
mortgage and the trustees,
(3) a description of certain
restrictions contained in our mortgage,
(4) a description of events of default
under our mortgage, and
(5) the meaning of certain capitalized
terms used but not defined in this prospectus supplement.
Underwriting
Under the terms and conditions set forth in the
underwriting agreement dated the date of this prospectus
supplement, we have agreed to sell to each of the underwriters
named below, and each of the underwriters has severally agreed
to purchase, the principal amount of the bonds set forth
opposite its name below:
Principal
Name
Amount
Credit Suisse First Boston LLC
$
40,000,000
KeyBanc Capital Markets, a division of McDonald
Investments Inc.
40,000,000
BNP Paribas Securities Corp.
20,000,000
Total
$
100,000,000
Under the terms and conditions of the
underwriting agreement, the underwriters have committed, subject
to the terms and conditions set forth therein, to take and pay
for all of the bonds if any of the bonds are taken, provided,
that under certain circumstances involving a default of an
underwriter, less than all of the bonds may be purchased.
The underwriters initially propose to offer part
of the bonds directly to the public at the price to public set
forth on the cover page hereof. After the initial offering of
the bonds, the offering price and other selling terms may from
time to time be varied by the underwriters.
We have agreed to indemnify the underwriters
against certain liabilities, including liabilities under the
Securities Act of 1933.
There is presently no trading market for the
bonds and there is no assurance that a market will develop since
we do not intend to apply for listing of the bonds on a national
securities exchange. Although they are under no obligation to do
so, the underwriters presently intend to act as market makers
for the bonds in the
S-10
secondary trading market, but may discontinue
such market-making at any time without notice. No assurance can
be given as to the liquidity of the trading market for the bonds.
In order to facilitate the offering of the bonds,
the underwriters may engage in transactions that stabilize,
maintain or otherwise affect the price of the bonds.
Specifically, the underwriters may overallot in connection with
the offering, creating a short position in the bonds for their
own account. In addition, to cover overallotments or to
stabilize the price of the bonds, the underwriters may bid for,
and purchase, the bonds in the open market. Finally, the
underwriters may reclaim selling concessions allowed to an
underwriter or a dealer for distributing the bonds in the
offering, if they repurchase previously distributed bonds in
transactions to cover syndicate short positions, in
stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price for the bonds above
independent market levels. The underwriters are not required to
engage in these activities and may end any of these activities
at any time.
We estimate that we will incur offering expenses
of approximately $164,000.
Certain underwriters or their affiliates may
engage, or have engaged, in various general financing and
commercial banking transactions from time to time with us or our
affiliates in the ordinary course of business, for which they
have received and may continue to receive customary fees and
commissions. The underwriters, either directly or through
affiliates, are lenders under certain Entergy System credit
facilities.
Experts
The financial statements and the related
financial statement schedule as of December 31, 2004 and
2003, and for each of the three years in the period ended
December 31, 2004, and management’s report on the
effectiveness of internal control over financial reporting as of
December 31, 2004, incorporated in this prospectus
supplement and the accompanying prospectus by reference from the
Company’s Annual Report on Form 10-K for the year
ended December 31, 2004, have been audited by
Deloitte & Touche LLP, an independent registered public
accounting firm, as stated in their reports, which are
incorporated herein by reference, and have been so incorporated
in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
Legality
The legality of the bonds will be passed upon for
us by Thelen Reid & Priest LLP, New York, New York, and Wise
Carter Child & Caraway, Professional Association, Jackson,
Mississippi. Certain matters with respect to the offering of the
bonds will be passed upon for the underwriters by Pillsbury
Winthrop Shaw Pittman LLP, New York, New York. Pillsbury
Winthrop Shaw Pittman LLP regularly represents our affiliates in
connection with various matters. All legal matters pertaining to
our organization, titles to property, franchises and the lien of
the mortgage and all matters pertaining to Mississippi law will
be passed upon only by Wise Carter Child & Caraway,
Professional Association. Thelen Reid & Priest LLP and
Pillsbury Winthrop Shaw Pittman LLP may rely on the opinion of
Wise Carter Child & Caraway, Professional Association as to
matters of Mississippi law related to their opinions.
S-11
PROSPECTUS
$400,000,000
First Mortgage Bonds
and
Debt Securities
Entergy Mississippi, Inc.
308 East Pearl Street
Jackson, Mississippi 39201
(601) 368-5000
We —
•
May periodically offer our first mortgage bonds
and our debt securities in one or more series; and
•
Will determine the price and other terms of each
series of securities when sold, including whether any series
will be subject to redemption prior to maturity.
The First Mortgage Bonds —
•
Will be secured by a mortgage that constitutes a
first mortgage lien on substantially all of our property.
The Debt Securities —
•
Will be unsecured and will rank equally with all
of our other unsecured and unsubordinated debt; and
•
Will be effectively subordinated to all of our
secured debt, including our first mortgage bonds.
You —
•
Will receive interest payments in the amounts and
on the dates specified in an accompanying prospectus supplement.
This prospectus may be used to offer and sell
series of securities only if accompanied by the prospectus
supplement for that series. We will provide the specific terms
of these securities, including their offering prices, interest
rates and maturities, in supplements to this prospectus. The
supplements may also add, update or change information in this
prospectus. You should read this prospectus and any supplements
carefully before you invest.
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.
We may offer these securities directly or
through underwriters, agents or dealers. Each prospectus
supplement will provide the terms of the plan of distribution
relating to each series of securities.
December 11, 2003
About this Prospectus
This prospectus is part of a registration
statement that we filed with the Securities and Exchange
Commission, or SEC, utilizing a “shelf” registration
process. Under this shelf process, we may sell the securities
described in this prospectus in one or more offerings up to a
total dollar amount of $400 million. This prospectus
provides a general description of the securities being offered.
Each time we sell a series of securities we will provide a
prospectus supplement containing specific information about the
terms of that series of securities and the related offering. It
is important for you to consider the information contained in
this prospectus and the related prospectus supplement together
with additional information described under the heading
“Where You Can Find More Information” in making your
investment decision.
Entergy Mississippi, Inc.
We are an electric public utility company
providing service to customers in the State of Mississippi since
1923.
We are owned by Entergy Corporation, which is a
public utility holding company registered under the Public
Utility Holding Company Act of 1935. The other major public
utilities owned by Entergy Corporation are Entergy Arkansas,
Inc., Entergy Gulf States, Inc., Entergy Louisiana, Inc. and
Entergy New Orleans, Inc. Entergy Corporation also owns all of
the common stock of System Energy Resources, Inc., the principal
asset of which is the Grand Gulf Electric Generating Station.
Capacity and energy from Grand Gulf is allocated
among Entergy Arkansas, Inc., Entergy Louisiana, Inc., Entergy
New Orleans, Inc. and us under a unit power sales agreement. Our
allocated share of Grand Gulf’s capacity and energy
together with related costs is 33%. Payments we make under the
unit power sales agreement are generally recovered through rates
set by the Mississippi Public Service Commission, which
regulates our electric service, rates and charges.
Together with Entergy Arkansas, Inc., Entergy
Louisiana, Inc. and Entergy New Orleans, Inc., we own all of the
capital stock of System Fuels, Inc. System Fuels, Inc. is a
special purpose company that implements and maintains programs
for the purchase, delivery and storage of fuel supplies for
Entergy Corporation’s utility subsidiaries.
The information above is only a summary and is
not complete. You should read the incorporated documents listed
under the caption “Where You Can Find More
Information” for more specific information concerning our
business and affairs, including significant contingencies, our
general capital requirements, our financing plans and
capabilities, and pending legal and regulatory proceedings,
including the status of industry restructuring in our service
areas.
Ratios of Earnings to Fixed Charges
We have calculated ratios of earnings to fixed
charges pursuant to Item 503 of SEC Regulation S-K as
follows:
Twelve
Months Ended
Twelve Months Ended December 31,
September 30,
2003
2002
2001
2000
1999
1998
2.92
2.48
2.14
2.33
2.44
3.12
“Earnings” represent the aggregate of
(1) income before the cumulative effect of an accounting
change, (2) taxes based on income, (3) investment tax
credit adjustments-net and (4) fixed charges.
“Fixed Charges” include interest
(whether expensed or capitalized), related amortization and
estimated interest applicable to rentals.
Where You Can Find More Information
We are required to file annual, quarterly and
current reports, proxy statements and other information with the
SEC. Our filings are available to the public on the Internet at
the SEC’s website located at (http://www.sec.gov).
You may read and copy any document at the SEC Public Reference
Room located at:
450 Fifth Street, N.W.
Room 1024
Washington, D.C. 20549-1004.
Call the SEC at 1-800-732-0330 for more
information about the public reference room and how to request
documents.
The SEC allows us to “incorporate by
reference” the information we file with the SEC, which
means we can refer you to important
2
information without restating it in this
prospectus. The information incorporated by reference is an
important part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed
below and any future filings that we make with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 until we have sold all of the securities
described in this prospectus:
1. Annual Report on Form 10-K for the
year ended December 31, 2002;
2. Quarterly Reports on Form 10-Q for
the quarters ended March 31, June 30 and
September 30, 2003; and
3. Current Report on Form 8-K dated
April 28, 2003.
You may access a copy of any or all of these
filings, free of charge, at our website
(http://www.entergy.com) or by writing or calling us at
the following address:
Mr. Christopher T. Screen
Assistant Secretary
Entergy Mississippi, Inc.
P. O. Box 61000
New Orleans, Louisiana 70161
(504) 576-4212
You may also direct your requests via e-mail to
cscreen@entergy.com.
You should rely only on the information
incorporated by reference or provided in this prospectus or any
prospectus supplement. We have not, nor have any underwriters,
dealers or agents, authorized anyone else to provide you with
different information about us or the securities. We are not,
nor are any underwriters, dealers or agents, making an offer of
the securities in any state where the offer is not permitted.
You should not assume that the information in this prospectus or
any prospectus supplement is accurate as of any date other than
the date on the front of those documents or that the documents
incorporated by reference in this prospectus are accurate as of
any date other than the date those documents were filed with the
SEC.
Use of Proceeds
The net proceeds from the offering of the
securities will be used either (a) to acquire or redeem one
or more series of our outstanding securities on or before their
stated due dates or (b) for other general corporate
purposes. The specific purposes for the proceeds of a particular
series of securities or the specific securities, if any, to be
acquired or redeemed with the proceeds of a particular series of
securities will be described in the prospectus supplement
relating to that series.
Description of the First Mortgage
Bonds
General
We will issue the first mortgage bonds offered by
this prospectus from time to time in one or more series under
one or more separate supplemental indentures to the Mortgage and
Deed of Trust dated as of February 1, 1988 with The Bank of
New York, successor corporate trustee, and Stephen J.
Giurlando, successor co-trustee, together referred to in this
prospectus as trustees. This Mortgage and Deed of Trust, as
amended and supplemented, is referred to in this prospectus as
the “mortgage.” All first mortgage bonds issued or to
be issued under the mortgage, including the first mortgage bonds
offered by this prospectus, are referred to herein as
“first mortgage bonds.”
The statements in this prospectus and any
accompanying prospectus supplement concerning the first mortgage
bonds and the mortgage are not comprehensive and are subject to
the detailed provisions of the mortgage. The mortgage and a form
of supplemental indenture are filed as exhibits to the
registration statement. You should read these documents for
provisions that may be important to you. The mortgage has been
qualified under the Trust Indenture Act of 1939. You should
refer to the Trust Indenture Act for provisions that apply
to the first mortgage bonds. Wherever particular provisions or
defined terms in the mortgage are referred to under this
“Description of the First Mortgage Bonds,” those
provisions or defined terms are incorporated by reference in
this prospectus.
3
Terms of Specific Series of the First
Mortgage Bonds
A prospectus supplement relating to each series
of first mortgage bonds offered by this prospectus will include
a description of the specific terms relating to the offering of
that series. These terms will include any of the following terms
that apply to that series:
(1) the designation, or name, of the series
of first mortgage bonds;
(2) the aggregate principal amount of the
series;
(3) the offering price of the series;
(4) the date on which the series will mature;
(5) the rate or method for determining the
rate at which the series will bear interest;
(6) the date from which interest on the
series accrues;
(7) the dates on which interest on the
series will be payable;
(8) the prices and other terms and
conditions, if any, upon which we may redeem the series prior to
maturity;
(9) the applicability of the dividend
covenant described below to the series;
(10) the terms of any insurance policy that
will be provided for the payment of principal of and/or interest
on the series; and
(11) any other terms or provisions relating
to that series that are not inconsistent with the mortgage.
Unless otherwise set forth in a prospectus
supplement, the first mortgage bonds offered by this prospectus
will not have the benefit of any sinking or improvement fund or
any maintenance or replacement fund.
As of September 30, 2003, we had
$717.85 million principal amount of first mortgage bonds
outstanding.
Security
The first mortgage bonds offered by this
prospectus, together with all other first mortgage bonds
outstanding now or in the future under the mortgage, will be
secured by the mortgage. In the opinion of our counsel, the
mortgage constitutes a first mortgage lien on substantially all
of our property subject to bankruptcy law and:
(1) minor defects and encumbrances
customarily found in similar properties that do not materially
impair the use of the property in the conduct of our business;
(2) other liens, defects and encumbrances,
if any, existing or placed thereon at the time of our
acquisition of the property; and
(3) excepted encumbrances.
The mortgage does not create a lien on the
following “excepted property”:
(1) cash and securities;
(2) all merchandise, equipment, apparatus
and supplies held for sale or other disposition in the usual
course of business or consumable during use;
(3) automobiles, vehicles and aircraft,
timber, minerals, mineral rights and royalties; and
(4) receivables, contracts, leases and
operating agreements.
The mortgage contains provisions that impose a
lien of the mortgage on property we acquire after the date of
the mortgage, other than excepted property, subject to
pre-existing liens. However, if we consolidate or merge with, or
sell substantially all of our assets to, another corporation,
the lien created by the mortgage will generally not cover the
property of the successor company, other than the property it
acquires from us and improvements, replacements and additions to
that property.
The mortgage also provides that the trustees have
a lien on the mortgaged property to ensure the payment of their
reasonable compensation, expenses and disbursements and for
indemnity against certain liabilities. This lien takes priority
over the lien securing the first mortgage bonds.
Issuance of Additional First Mortgage
Bonds
There is no limit to the amount of first mortgage
bonds that we can issue under the mortgage. First mortgage bonds
of any series may
4
be issued from time to time on the following
bases:
(1) 70% of property additions after
adjustments to offset retirements;
(2) retirements of first mortgage bonds or
bonds issued under our discharged Mortgage and Deed of Trust,
dated as of September 1, 1944; or
(3) deposit of cash with the trustees.
Property additions generally include, among other
things, electric, gas, steam or hot water property acquired
after December 31, 1987. Securities, automobiles, vehicles
or aircraft, or property used principally for the production or
gathering of natural gas may not be included as property
additions. Deposited cash may be withdrawn upon the bases stated
in clause (1) or (2) above.
As of September 30, 2003, we could have
issued approximately $241 million of additional first
mortgage bonds on the basis of net property additions and
approximately $250 million on the basis of retired bond
credits.
With certain exceptions in the case of
clause (2) above, the issuance of first mortgage bonds must
meet an “earnings” test. The adjusted net earnings,
before income taxes, for 12 consecutive months of the preceding
18 months, must be at least twice the annual interest
requirements on all first mortgage bonds outstanding at the
time, including the additional first mortgage bonds to be
issued, plus all indebtedness, if any, of prior rank. In
general, interest on variable interest rate bonds, if any, is
calculated using the average rate in effect during such 12-month
period.
The mortgage contains restrictions on the
issuance of first mortgage bonds against property subject to
liens.
Other than the security afforded by the lien of
the mortgage and restrictions on the issuance of additional
first mortgage bonds described above, there are no provisions of
the mortgage that grant the holders of the first mortgage bonds
protection in the event of a highly leveraged transaction
involving us. However, such a transaction would require approval
by the SEC and the Mississippi Public Service Commission. We
believe it unlikely that we could obtain those approvals in a
highly leveraged context.
Release and Substitution of
Property
We may release property from the lien of the
mortgage, without applying an earnings test, on the following
bases:
(1) the deposit of cash or, to a limited
extent, purchase money mortgages;
(2) property additions, after adjustments in
certain cases to offset retirements and after making adjustments
for certain prior lien bonds, if any, outstanding against
property additions; and
(3) a waiver of the right to issue first
mortgage bonds.
We can withdraw cash upon the bases stated in
clauses (2) and (3) above. Property we owned on
December 31, 1987 may be released on the basis of its
depreciated book, value while all other property may be released
on the basis of its cost, as defined in the mortgage.
We may release unfunded property if after such
release at least one dollar in unfunded property remains subject
to the lien of the mortgage.
Dividend Covenant
We may covenant that, so long as a particular
series of first mortgage bonds remains outstanding, we will not
pay any cash dividends on common stock or repurchase common
stock after a selected date close to the date of the original
issuance of that series of first mortgage bonds, other than
certain dividends that we may declare prior to this date, except
out of credits to retained earnings after this selected date
plus an amount not to exceed $250 million plus any additional
amounts that the SEC may approve. The prospectus supplement
relating to a particular series of first mortgage bonds will
state if this covenant will apply to that series.
Modification
Your rights as a bondholder may be modified with
the consent of the holders of a majority in aggregate principal
amount of the first mortgage bonds, or, if less than all series
of first mortgage bonds are adversely affected, with the consent
of the holders of a majority in aggregate principal amount of
the first mortgage bonds adversely affected. In general, no
modification is effective
5
against any bondholder without that
bondholder’s consent if it:
(1) affects the terms of payment of
principal, premium, if any, or interest;
(2) affects the lien of the mortgage; or
(3) reduces the percentage required for
modification.
Defaults and Notices Thereof
Defaults under the mortgage include:
(1) default in the payment of principal;
(2) default for 30 days in the payment
of interest;
(3) certain events of bankruptcy, insolvency
or reorganization;
(4) defaults under a supplemental
indenture; and
(5) default in other covenants for
90 days after notice (unless we have in good faith
commenced efforts to perform the covenant).
The corporate trustee or the holders of 25% of
the first mortgage bonds may declare the principal and interest
due and payable on default. However, a majority of the holders
may annul such declaration if the default has been cured. No
holder of first mortgage bonds may enforce the lien of the
mortgage without giving the trustees written notice of a default
and unless
(1) the holders of 25% of the first mortgage
bonds have requested the trustees in writing to act, offered
them reasonable opportunity to act and indemnity satisfactory to
them against the costs, expenses and liabilities to be incurred
thereby; and
(2) the trustees shall have failed to act
within 60 days of such request.
The holders of a majority in aggregate principal
amount of the first mortgage bonds may direct the time, method
and place of conducting any proceedings for any remedy available
to the trustees or exercising any trust or power conferred on
the trustees. The trustees are not required to risk their funds
or incur personal liability if there is reasonable ground for
believing that repayment is not reasonably assured.
Evidence to be Furnished to the Corporate
Trustee
Compliance with the mortgage provisions is
evidenced by written statements of our officers or persons we
select or pay. In certain cases, opinions of counsel and
certifications of an engineer, accountant, appraiser or other
expert (who in some cases must be independent) must be
furnished. We must give the corporate trustee an annual
certificate as to whether or not we have fulfilled our
obligations under the mortgage throughout the preceding year.
Satisfaction and Discharge of
Mortgage
After we provide for the payment of all of the
first mortgage bonds (including the first mortgage bonds offered
by this prospectus) and after paying all other sums due under
the mortgage, the mortgage may be satisfied and discharged. The
first mortgage bonds will be deemed to have been paid when money
or Eligible Obligations (as defined below) sufficient to pay the
first mortgage bonds (in the opinion of an independent
accountant in the case of Eligible Obligations) at maturity or
upon redemption have been irrevocably set apart or deposited
with the corporate trustee, provided that the corporate trustee
shall have received an opinion of counsel to the effect that the
setting apart or deposit does not require registration under the
Investment Company Act of 1940, does not violate any applicable
laws and does not result in a taxable event with respect to the
holders of the first mortgage bonds prior to the time of their
right to receive payment. “Eligible Obligations” means
obligations of the United States of America that do not permit
the redemption thereof at the issuer’s option.
Description of Debt Securities
General
The debt securities will be our direct unsecured
general obligations. We will issue the debt securities offered
by this prospectus from time to time in one or more series under
one or more separate indentures between us and the financial
institution(s) that we will name in the prospectus supplement,
as trustee. This indenture or indentures are collectively
referred to in this prospectus as the “indenture.”
6
The following description summarizes certain
general terms and provisions of the debt securities offered by
this prospectus. This summary is not complete and should be read
together with the prospectus supplement describing the specific
terms of the debt securities. The form of the indenture is filed
as an exhibit to the registration statement. You should read the
indenture for provisions that may be important to you. The
indenture will be qualified under the Trust Indenture Act
of 1939. You should refer to the Trust Indenture Act for
provisions that apply to the debt securities. Whenever
particular provisions or defined terms in the indenture are
referred to under this “Description of Debt
Securities,” those provisions or defined terms are
incorporated by reference in this prospectus.
The debt securities will rank equally with all of
our other unsecured and unsubordinated debt. As of
September 30, 2003, we had $35.3 million of unsecured
and unsubordinated debt that would have ranked equally with the
debt securities.
The debt securities will be effectively
subordinated to all of our secured debt, including our first
mortgage bonds. As of September 30, 2003, we had
$747.85 million of secured debt outstanding.
Terms of Specific Series of the Debt
Securities
A prospectus supplement relating to each series
of debt securities offered by this prospectus will include a
description of the specific terms relating to the offering of
that series. These terms will include any of the following terms
that apply to that series:
(1) the title of the debt securities;
(2) the total principal amount of the debt
securities;
(3) the date or dates on which the principal
of the debt securities will be payable or how the date or dates
will be determined;
(4) the rate or rates at which the debt
securities will bear interest, or how the rate or rates will be
determined, the date or dates from which any such interest will
accrue, the interest payment dates for the debt securities and
the regular record dates for interest payments;
(5) the percentage, if less than 100%, of
the principal amount of the debt securities that will be payable
if the maturity of the debt securities is accelerated;
(6) any period or periods within which, or
any date or dates on which, and the price or prices at which and
the terms and conditions upon which, we may redeem the debt
securities at our option and any restrictions on those
redemptions;
(7) any sinking fund or other provisions or
options held by holders of debt securities that would obligate
us to repurchase or otherwise redeem the debt securities;
(8) any changes or additions to the events
of default under the indenture or changes or additions to our
covenants under the indenture;
(9) if the debt securities will be issued in
denominations other than $1,000;
(10) if payments on the debt securities may
be made in a currency or currencies other than United States
dollars;
(11) any collateral, security, assurance or
guarantee for the debt securities; and
(12) any other terms of the debt securities
not inconsistent with the terms of the indenture.
Our amended and restated articles of
incorporation generally limit the amount of unsecured debt that
we may issue to the equivalent of 20% of the total of all our
secured debt and total equity. As of September 30, 2003,
approximately $19.28 million of additional unsecured debt
with a maturity of less than ten years or $16.03 million of
additional unsecured debt with a maturity of ten or more years
could have been issued under this provision. The indenture does
not limit the principal amount of debt securities that we may
issue under the indenture.
We may sell debt securities at a discount below
their principal amount. We may describe in the prospectus
supplement federal income tax considerations applicable to debt
securities sold at an original issue discount. In addition, we
may describe in the prospectus supplement important federal
income tax or other tax considerations
7
applicable to any debt securities denominated or
payable in a currency or currency unit other than United States
dollars.
Except as we may otherwise describe in the
prospectus supplement, the covenants contained in the indenture
will not afford holders of debt securities protection in the
event of a highly-leveraged or similar transaction involving us
or in the event of a change of control.
Payment and Paying Agents
Except as we may otherwise provide in the
prospectus supplement, we will pay interest, if any, on each
debt security payable on each interest payment date to the
person in whose name that debt security is registered as of the
close of business on the regular record date for that interest
payment date. However, interest payable at maturity will be paid
to the person to whom the principal is paid. If there has been a
default in the payment of interest on any debt security, the
defaulted interest may be paid to the holder of such debt
security as of the close of business on a date to be fixed by
the trustee between 10 and 15 days prior to the date
proposed by us for payment of such defaulted interest or in any
other manner permitted by any securities exchange on which that
debt security may be listed, if the trustee finds it practicable.
Unless we otherwise specify in the prospectus
supplement, principal of, and premium, if any, and interest on
the debt securities at maturity will be payable upon
presentation of the debt securities at the corporate trust
office of the trustee in New York, New York, as our
paying agent. We may change the place of payment on the debt
securities, may appoint one or more additional paying agents,
including us, and may remove any paying agent, all at our
discretion.
As long as the debt securities are registered in
the name of The Depository Trust Company, or DTC, or its
nominee, as described under the caption “Book-Entry Only
Securities,” payments of principal, premium, if any, and
interest will be made to DTC for subsequent disbursement to
beneficial owners of the debt securities.
Registration and Transfer
Unless we otherwise specify in the prospectus
supplement, and subject to restrictions related to the issuance
of debt securities through DTC’s book-entry system, the
transfer of debt securities may be registered, and debt
securities may be exchanged for other debt securities of the
same series or tranche, of authorized denominations and with the
same terms and principal amount, at the corporate trust office
of the trustee in New York, New York. We may change
the place for registration of transfer and exchange of the debt
securities and may designate additional places for registration
and exchange. Unless we otherwise provide in the prospectus
supplement, no service charge will be made for any registration
of transfer or exchange of the debt securities. However, we may
require payment to cover any tax or other governmental charge
that may be imposed. We will not be required to execute or to
provide for the registration of transfer of, or the exchange of,
(1) any debt security during the 15 days prior to
giving any notice of redemption or (2) any debt security
selected for redemption, except the unredeemed portion of any
debt security being redeemed in part.
Satisfaction and Discharge
We will be discharged from our obligations on the
debt securities of a particular series if we deposit with the
trustee sufficient cash or government securities to pay the
principal, interest, any premium and any other sums when due on
the stated maturity date or a redemption date of that series of
debt securities.
The indenture will be deemed satisfied and
discharged when no debt securities remain outstanding and when
we have paid all other sums payable by us under the indenture.
Consolidation, Merger and Sale of
Assets
Under the terms of the indenture, we may not
consolidate with or merge into any other entity or convey, or
transfer or lease our properties and assets substantially as an
entirety to any entity, unless:
(1) the surviving or successor entity is
organized and validly existing under the laws of any domestic
jurisdiction and it expressly assumes our payment obligations on
all outstanding debt securities and our obligations under the
indenture;
8
(2) immediately after giving effect to the
transaction, no event of default and no event that, after notice
or lapse of time or both, would become an event of default,
shall have occurred and be continuing; and
(3) we shall have delivered to the trustee
an officer’s certificate and an opinion of counsel as
provided in the indenture.
So long as we comply with the conditions in
clauses (2) and (3) above, the terms of the indenture
do not preclude us from being a party to a merger in which we
are the surviving entity.
Events of Default
“Event of default,” when used in the
indenture with respect to any series of debt securities, means
any of the following:
(1) failure to pay interest on any debt
security of that series for 60 days after it is due;
(2) failure to pay the principal of or any
premium on any debt security of that series when due;
(3) failure to perform any other covenant in
the indenture, other than a covenant that does not relate to
that series of debt securities, that continues for 60 days
after we receive written notice from the trustee or after we and
the trustee receive written notice from the holders of at least
33% in principal amount of the outstanding debt securities of
that series; however, the trustee or the trustee and the holders
of that principal amount of debt securities of that series can
agree to an extension of the 60-day period and such an agreement
to extend will be automatically deemed to occur if we are
diligently pursuing action to correct the default;
(4) events in bankruptcy, insolvency or
reorganization specified in the indenture; or
(5) any other event of default specified for
that series of debt securities.
An event of default for a particular series of
debt securities does not necessarily constitute an event of
default for any other series of debt securities issued under the
indenture. The trustee may withhold notice to the holders of
debt securities of any default, except default in the payment of
principal, premium or interest, if it considers the withholding
of notice to be in the interests of holders.
Remedies
Acceleration of Maturity
If an event of default for any series of debt
securities occurs and continues, then either the trustee or the
holders of at least 33% in principal amount of that series may
declare the entire principal amount of all the debt securities
of that series, together with accrued interest, to be due and
payable immediately. However, if the event of default is
applicable to more than one series of debt securities under the
indenture, only the trustee or holders of at least 33% in
principal amount of the outstanding debt securities of all
affected series, voting as one class, and not the holders of any
one series, may make that declaration of acceleration.
At any time after a declaration of acceleration
with respect to the debt securities of any series has been made
and before a judgment or decree for payment of the money due has
been obtained, the event of default giving rise to that
declaration of acceleration will be considered waived, and that
declaration and its consequences will be considered rescinded
and annulled, if:
(1) we have paid or deposited with the
trustee a sum sufficient to pay:
(a) all overdue interest on all debt
securities of that series;
(b) the principal of and premium, if any, on
any debt securities of that series that have become due
otherwise than by the declaration of acceleration and interest
that is due on that principal;
(c) interest on overdue interest; and
(d) all amounts due to the trustee under the
indenture; and
(2) any other event of default with respect
to the debt securities of that series, other than the
non-payment of principal that has become due solely by the
declaration of acceleration, has been cured or waived as
provided in the indenture.
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There is no automatic acceleration, even in the
event of our bankruptcy, insolvency or reorganization.
Right to Direct Proceedings
Other than its duties in case of an event of
default, the trustee is not obligated to exercise any of its
rights or powers under the indenture at the request, order or
direction of any of the holders, unless the holders offer the
trustee reasonable security or indemnity. If they provide this
reasonable security or indemnity, the holders of a majority in
principal amount of any series of debt securities will have the
right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee, or
exercising any power conferred upon the trustee. However, if the
event of default relates to more than one series of debt
securities, only the holders of a majority in aggregate
principal amount of all affected series, voting as one class,
will have the right to give this direction and not the holders
of any one series. The trustee is not obligated to comply with
directions that conflict with law or other provisions of the
indenture.
Limitation on Right to Institute
Proceedings
No holder of debt securities of any series will
have any right to institute any proceeding or remedy under the
indenture unless:
(1) the holder has previously given to the
trustee written notice of a continuing event of default;
(2) the holders of a majority in aggregate
principal amount of the outstanding debt securities of all
series in respect of which an event of default shall have
occurred and be continuing have made a written request to the
trustee and have offered reasonable indemnity to the trustee to
institute proceedings; and
(3) the trustee has failed to institute any
proceeding for 60 days after that notice, request and offer
of indemnity.
However, these limitations do not apply to a suit
by a holder of a debt security for payment of the principal,
premium, if any, or interest on that debt security on or after
the applicable due date.
Annual Notice to Trustee
We will provide to the trustee an annual
statement by an appropriate officer as to our compliance with
all conditions and covenants under the indenture.
Modification and Waiver
Without the consent of any holder of debt
securities, we may enter into one or more supplemental
indentures for any of the following purposes:
(1) to evidence the assumption by any
permitted successor of our covenants in the indenture and in the
debt securities;
(2) to add additional covenants or to
surrender any of our rights or powers under the indenture;
(3) to add additional events of default;
(4) to change or eliminate any provision of
the indenture or to add any new provision to the indenture;
provided, however, if the change, elimination or addition will
adversely affect the interests of the holders of debt securities
of any series in any material respect, the change, elimination
or addition will become effective only:
(a) when the consent of the holders of debt
securities of that series has been obtained in accordance with
the indenture; or
(b) when no debt securities of the affected
series remain outstanding under the indenture;
(5) to provide collateral security for all
but not part of the debt securities;
(6) to establish the form or terms of debt
securities of any series as permitted by the indenture;
(7) to provide for the authentication and
delivery of bearer securities and coupons attached thereto;
(8) to evidence and to provide for the
acceptance of appointment of a successor trustee;
(9) to provide for the procedures required
for use of a non-certificated system
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of registration for the debt securities of all or
any series;
(10) to change any place where principal,
premium, if any, and interest shall be payable, debt securities
may be surrendered for registration of transfer or exchange and
notices to us may be served; or
(11) to cure any ambiguity or inconsistency
or to make any other change to the provisions or to add other
provisions with respect to matters or questions arising under
the indenture; provided that the action does not adversely
affect the interests of the holders of debt securities of any
series in any material respect.
The holders of a majority in aggregate principal
amount of the debt securities of all series then outstanding may
waive our compliance with some restrictive provisions of the
indenture. The holders of a majority in principal amount of the
outstanding debt securities of any series may waive any past
default under the indenture with respect to that series, except
a default in the payment of principal, premium, if any, or
interest and certain covenants and provisions of the indenture
that cannot be modified or amended without the consent of the
holder of each outstanding debt security of the series affected.
If the Trust Indenture Act of 1939 is
amended after the date of the indenture in such a way as to
require changes to the indenture, the indenture will be deemed
to be amended so as to conform to that amendment to the
Trust Indenture Act of 1939. We and the trustee may,
without the consent of any holders, enter into one or more
supplemental indentures to evidence that amendment.
The consent of the holders of a majority in
aggregate principal amount of the debt securities of all series
then outstanding, voting as one class, is required for all other
modifications to the indenture. However, if less than all of the
series of debt securities outstanding are directly affected by a
proposed supplemental indenture, then only the consent of the
holders of a majority in aggregate principal amount of all
series that are directly affected, voting as one class, will be
required. No supplemental indenture may:
(1) change the stated maturity of the
principal of, or any installment of principal of or interest on,
any debt security, or reduce the principal amount of any debt
security or its rate of interest, or change the method of
calculating the interest rate, or reduce any premium payable
upon redemption, or reduce the amount of principal that would be
due and payable upon a declaration of acceleration of the
maturity thereof, or change the currency in which payments are
made, or impair the right to institute suit for the enforcement
of any payment on or after the stated maturity of any debt
security, without the consent of the holder of that debt
security;
(2) reduce the percentage in principal
amount of the outstanding debt securities of any series the
consent of the holders of which is required for any supplemental
indenture or any waiver of compliance with a provision of the
indenture or any default thereunder and its consequences, or
reduce the requirements for quorum or voting, without the
consent of all the holders of the series; or
(3) modify some of the provisions of the
indenture relating to supplemental indentures, waivers of
certain covenants and waivers of past defaults with respect to
the debt securities of any series, without the consent of the
holder of each outstanding debt security affected thereby.
A supplemental indenture that changes the
indenture solely for the benefit of one or more particular
series of debt securities, or modifies the rights of the holders
of debt securities of one or more series, will not affect the
rights under the indenture of the holders of the debt securities
of any other series.
The indenture provides that debt securities owned
by us or anyone else required to make payment on the debt
securities shall be disregarded and considered not to be
outstanding in determining whether the required holders have
given a request or consent.
We may fix in advance a record date to determine
the required number of holders entitled to give any request,
demand, authorization, direction, notice, consent, waiver or
other such act of the holders, but we shall have no obligation
to do so. If we fix a record date, that request, demand,
authorization, direction, notice, consent,
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waiver or other act of the holders may be given
before or after that record date, but only the holders of record
at the close of business on that record date will be considered
holders for the purposes of determining whether holders of the
required percentage of the outstanding debt securities have
authorized or agreed or consented to the request, demand,
authorization, direction, notice, consent, waiver or other act
of the holders. For that purpose, the outstanding debt
securities shall be computed as of the record date. Any request,
demand, authorization, direction, notice, consent, election,
waiver or other act of a holder will bind every future holder of
the same debt securities and the holder of every debt security
issued upon the registration of transfer of or in exchange of
those debt securities. A transferee will be bound by acts of the
trustee or us in reliance thereon, whether or not notation of
that action is made upon the debt security.
Resignation of Trustee
A trustee may resign at any time by giving
written notice to us or may be removed at any time by act of the
holders of a majority in principal amount of all series of debt
securities then outstanding delivered to the trustee and us. No
resignation or removal of a trustee and no appointment of a
successor trustee will be effective until the acceptance of
appointment by a successor trustee. So long as no event of
default or event that, after notice or lapse of time, or both,
would become an event of default has occurred and is continuing,
and except with respect to a trustee appointed by act of the
holders, if we have delivered to the trustee a resolution of our
board of directors appointing a successor trustee and such
successor has accepted the appointment in accordance with the
terms of the respective indenture, the trustee will be deemed to
have resigned and the successor will be deemed to have been
appointed as trustee in accordance with the indenture.
Notices
We, the trustee, any of our agents, or any agent
of the trustee will give notices to holders of debt securities
by mail to the addresses of such holders as they appear in the
security register under the indenture.
Title
We, the trustee, and any of our agents or any
agent of the trustee may treat the person in whose name debt
securities are registered as the absolute owner thereof, whether
or not the debt securities may be overdue, for the purpose of
making payments and for all other purposes irrespective of
notice to the contrary.
Governing Law
Each indenture and the debt securities will be
governed by, and construed in accordance with, the laws of the
State of New York.
Book-Entry Only Securities
The Depository Trust Company will act as
securities depository for the securities offered through this
prospectus. The securities will be issued as fully registered
securities registered in the name of Cede & Co., the
partnership nominee of DTC. One or more fully registered
security certificates will be issued for each issue of the
securities, in the aggregate principal amount of such issue, and
will be deposited with DTC.
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 pursuant to the provisions of
Section 17A of the Securities Exchange Act of 1934. DTC
holds and provides asset servicing for United States and foreign
equity issues, corporate and municipal debt issues, and money
market instruments from countries that DTC participants
(“Direct Participants”) deposit with DTC. DTC also
facilitates the post-trade settlement among Direct Participants
of sales and other securities transactions in deposited
securities through electronic computerized book-entry transfers
and pledges between the accounts of Direct Participants, thereby
eliminating the need for physical movement of security
certificates. Direct Participants include both United States and
foreign securities brokers and dealers, banks, trust companies,
clearing corporations, and certain other organizations. DTC is a
wholly owned subsidiary of The Depository Trust &
Clearing Corporation (“DTCC”). DTCC is, in turn, owned
by a
12
number of Direct Participants of DTC and members
of the National Securities Clearing Corporation, Government
Securities Clearing Corporation, MBS Clearing Corporation, and
Emerging Markets Clearing Corporation, all of which clearing
corporations are subsidiaries of DTCC, as well as by The
New York Stock Exchange, Inc., the American Stock Exchange
LLC, and the National Association of Securities Dealers, Inc.
Access to the DTC system is also available to other entities
such as both United States and foreign securities brokers and
dealers, banks, trust companies, and clearing corporations that
clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly (“Indirect
Participants” and, together with Direct Participants, the
“Participants”). The DTC rules applicable to its
Participants are on file with the SEC.
Purchases of securities under the DTC system must
be made by or through Direct Participants, which will receive a
credit for the securities on the records of DTC. The ownership
interest of each actual purchaser of each security
(“Beneficial Owner”) is in turn to be recorded on the
records of the Direct Participant or the Indirect Participant.
Beneficial Owners will not receive written confirmation from DTC
of their purchases. Beneficial Owners are, however, expected to
receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings,
from the Direct Participant or Indirect Participant through
which the Beneficial Owner entered into the transaction.
Transfers of ownership interests in the securities are to be
accomplished by entries made on the books of Direct Participants
and Indirect Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing
their ownership interests in securities, except in the event
that use of the book-entry system for the securities is
discontinued.
To facilitate subsequent transfers, all
securities deposited by Direct Participants with DTC are
registered in the name of Cede & Co., the partnership
nominee of DTC, or such other name as may be requested by an
authorized representative of DTC. The deposit of securities with
DTC and their registration in the name of Cede & Co. or
such other DTC nominee do not effect any change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners
of the securities; the records of DTC reflect only the identity
of the Direct Participants to whose accounts such securities are
credited, which may or may not be the Beneficial Owners. The
Direct Participants and Indirect Participants will remain
responsible for keeping account of their holdings on behalf of
their customers.
Conveyance of notices and other communications by
DTC to Direct Participants, by Direct Participants to Indirect
Participants, and by Direct Participants and Indirect
Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Beneficial
Owners of securities may wish to take certain steps to augment
the transmission to them of notices of significant events with
respect to the securities, such as redemptions, tenders,
defaults, and proposed amendments to the mortgage or the
indenture, as appropriate. For example, Beneficial Owners of
securities may wish to ascertain that the nominee holding the
securities for their benefit has agreed to obtain and to
transmit notices to Beneficial Owners. In the alternative,
Beneficial Owners may wish to provide their names and addresses
to the corporate trustee or the trustee and request that copies
of notices be provided directly to them.
Redemption notices shall be sent to DTC. If less
than all the securities within an issue are being redeemed, the
practice of DTC is to determine by lot the amount of the
interest of each Direct Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. nor any other
DTC nominee will consent or vote with respect to securities
unless authorized by a Direct Participant in accordance with DTC
procedures. Under its usual procedures, DTC mails an omnibus
proxy to us as soon as possible after the record date. The
omnibus proxy assigns the consenting or voting rights of
Cede & Co. to those Direct Participants to whose
accounts securities are credited on the record date, identified
in a listing attached to the omnibus proxy.
Redemption proceeds, principal payments, interest
payments, and any premium payments on the securities will be
made to Cede & Co. or such other nominee as may be
requested by an authorized representative of DTC. The practice of
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DTC is to credit the accounts of Direct
Participants, upon the receipt by DTC of funds and corresponding
detail information from us or the corporate trustee or the
trustee, as appropriate, on the payable date in accordance with
their respective holdings shown on the records of DTC. Payments
by Participants to Beneficial Owners will be governed by
standing instructions and customary practice, as is the case
with securities held for the accounts of customers in bearer
form or registered in “street name,” and will be the
responsibility of such Participant and not of DTC or its
nominee, the corporate trustee or the trustee, any underwriters
or dealers or agents, or us, subject to any statutory or
regulatory requirements as may be in effect from time to time.
Payment of redemption proceeds, principal, interest, and any
premium on the securities to Cede & Co. or such other
nominee as may be requested by an authorized representative of
DTC is the responsibility of either the corporate trustee or the
trustee, as appropriate, or us, disbursement of such payments to
Direct Participants will be the responsibility of DTC, and
disbursement of such payments to the Beneficial Owners will be
the responsibility of Direct Participants and Indirect
Participants.
A Beneficial Owner shall give notice to elect to
have its securities purchased or tendered, through its
Participant, to the tender or remarketing agent and shall effect
delivery of such securities by causing the Direct Participant to
transfer the interest of the Participant in the securities, on
the records of DTC, to the tender or remarketing agent. The
requirement for physical delivery of securities in connection
with an optional tender or a mandatory purchase will be deemed
satisfied when the ownership rights in the securities are
transferred by Direct Participants on the records of DTC and
followed by a book-entry credit of tendered securities to the
DTC account of the tender or remarketing agent.
DTC may discontinue providing its services as
depository with respect to the securities at any time by giving
reasonable notice to the trustee or us. Under such
circumstances, in the event that a successor depository is not
obtained, securities certificates are required to be printed and
delivered.
We may decide to discontinue use of the system of
book-entry transfers through DTC or a successor securities
depository. In that event, security certificates will be printed
and delivered.
The information in this section concerning DTC
and its book-entry system has been obtained from sources that we
believe to be reliable, but we take no responsibility for the
accuracy thereof.
Experts
The financial statements and related financial
statement schedule incorporated in this prospectus by reference
from our 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 reports,
which are incorporated herein by reference, and have been so
incorporated in reliance upon the reports of such firm upon
their authority as experts in accounting and auditing.
Legality
The legality of the securities will be passed
upon for us by Thelen Reid & Priest LLP, New York,
New York, and Wise Carter Child & Caraway,
Professional Association, Jackson, Mississippi, and for any
underwriters, dealers or agents by Pillsbury Winthrop LLP,
New York, New York. All legal matters pertaining to
our organization, titles to property, franchises and the lien of
the mortgage and all matters pertaining to Mississippi law will
be passed upon only by Wise Carter Child & Caraway,
Professional Association.
The statements in this prospectus as to matters
of law and legal conclusions made under “Description of the
First Mortgage Bonds — Security,” have been
reviewed by Wise Carter Child & Caraway, Professional
Association, and are set forth herein in reliance upon the
opinion of said firm and upon their authority as experts.
Plan of Distribution
Methods and Terms of Sale
We may use a variety of methods to sell the
securities including:
(1) through one or more underwriters or
dealers;
(2) directly to one or more purchasers;
(3) through one or more agents; or
14
(4) through a combination of any of these
methods of sale.
The prospectus supplement relating to a
particular series of the securities will describe the terms of
the offering of the securities, including:
(1) the name or names of any underwriters,
dealers or agents and any syndicate of underwriters;
(2) the initial public offering price;
(3) any underwriting discounts and other
items constituting underwriters’ compensation;
(4) the proceeds we receive from that
sale; and
(5) any discounts or concessions allowed or
reallowed or paid by any underwriters to dealers.
Underwriters
If we sell the securities through underwriters,
they will acquire the securities for their own account and may
resell them from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. The
underwriters for a particular underwritten offering of
securities will be named in the prospectus supplement and, if an
underwriting syndicate is used, the managing underwriter or
underwriters will be named on the cover page. In connection with
the sale of securities, the underwriters may receive
compensation from us or from purchasers in the form of
discounts, concessions or commissions. The obligations of the
underwriters to purchase securities will be subject to certain
conditions. The underwriters will be obligated to purchase all
of the securities of a particular series if any are purchased.
However, the underwriters may purchase less than all of the
securities of a particular series should certain circumstances
involving a default of one or more underwriters occur.
The initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers
by any underwriters may be changed from time to time.
Stabilizing Transactions
Underwriters may engage in stabilizing
transactions and syndicate covering transactions in accordance
with Rule 104 under the Securities Exchange Act of 1934.
Stabilizing transactions permit bids to purchase the underlying
security so long as the stabilizing bids do not exceed a
specified maximum. Syndicate covering transactions involve
purchases of the securities in the open market after the
distribution has been completed in order to cover syndicate
short positions. These stabilizing transactions and syndicate
covering transactions may cause the price of the securities to
be higher than it would otherwise be if these transactions had
not occurred.
Agents
If we sell the securities through agents, the
prospectus supplement will set forth the name of any agent
involved in the offer or sale of the securities, as well as any
commissions we will pay to them. Unless otherwise indicated in
the prospectus supplement, any agent will be acting on a best
efforts basis for the period of its appointment.
Related Transactions
Underwriters, dealers and agents may engage in
transactions with, or perform services for, us or our affiliates
in the ordinary course of business.
Indemnification
We will agree to indemnify any underwriters,
dealers, agents or purchasers and their controlling persons
against certain civil liabilities, including liabilities under
the Securities Act of 1933.
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