[Federal Register Volume 62, Number 232 (Wednesday, December 3, 1997)]
[Notices]
[Pages 63996-63997]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-31618]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-26785]


Filings Under the Public Utility Holding Company Act of 1935, as 
Amended (``Act'')

November 25, 1997.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendments thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by December 18, 1997, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 20549, and serve a copy on the relevant 
applicant(s) and/or declarant(s) at the address(es) specified below. 
Proof of service (by affidavit or, in case of an attorney at law, by 
certificate) should be filed with request. Any request for hearing 
shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.

Central and South West Corporation, et al.

[70-9113]

    Central and South West Corporation (``CSW''), a registered holding 
company, 1616 Woodall Rodgers Freeway, Dallas, Texas 75202, and its 
wholly-owned service company subsidiary, Central and South West 
Services, Inc. (``CSW Services''), 212 East 6th Street, Tulsa, Oklahoma 
74119, have filed an application-declaration under sections 6(a), 7, 
9(a), 10, 12(c) and 13(b) of the Act and rules 42, 54 and 87-91 
thereunder.
    CSW owns all of the outstanding shares of common stock of four 
public utility subsidiaries (collectively, ``Operating Companies''): 
Central Power and Light Company, Public Service Company of Oklahoma, 
Southwestern Electric Power Company, and West Texas Utilities Company. 
Together, these Operating Companies provide electric service to 
approximately 1.7 million customers in a widely diversified area 
covering 152,000 square miles in portions of Arkansas, Louisiana, 
Oklahoma and Texas.\1\
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    \1\ CSW also has numerous nonutility subsidiaries, including CSW 
Energy, Inc., which develops and operates independent power and 
cogeneration projects; CSW International, Inc., which pursues 
investments in energy ventures internationally, and which, 
indirectly, owns all the outstanding share capital of SEEBOARD 
p.l.c., one of 12 regional electricity companies in the United 
Kingdom; CSW Credit, Inc., which purchases the accounts receivable 
of the Operating Companies and certain non-affiliated electric 
utilities; CSW Communications, Inc., which provides communication 
services to the Operating Companies and certain non-affiliates; CSW 
Leasing, Inc., which invests in leveraged leases; EnerShop, Inc., 
which provides energy management services; and CSW Services, which 
performs, at cost, various accounting, engineering, tax, legal, 
financial electronic data processing, centralized economic 
dispatching of electric power and other services to CSW and its 
subsidiaries.
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    CSW requests authorization to adopt and implement a stockholder 
rights plan (``Rights Plan'') under which CSW's Board of Directors 
(``Board'') would declare a dividend of one right (``Right'') for each 
outstanding share of CSW Common Stock, par value $3.50 per share 
(``Common Stock''), payable to stockholders of record on a date to be 
established (``Record Date'').\2\ The Rights will be created by and 
issued under a rights agreement (``Rights Agreement'') to be entered 
into by CSW and CSW Services, as Rights Agent.\3\ The Rights created 
under the proposed Rights Agreement would entitle the holders to 
purchase one-tenth of a share of Common Stock at a price of $50 per 
whole share of Common Stock, subject to adjustment (Purchase 
Price'').\4\ This is equivalent to $5 per one-tenth of one share of 
Common Stock. CSW states that

[[Page 63997]]

the Purchase Price represents the Board's estimation of the long-term 
value of the Common Stock. The Board has adopted and approved the 
Rights Agreement subject to the receipt of an appropriate order from 
the Commission in this filing. Upon receipt of such an order, the 
Rights will be distributed as a dividend to the holders of CSW's 
outstanding shares of Common Stock.\5\
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    \2\ As of June 30, 1997 there were 212,235,310 shares of Common 
Stock outstanding.
    \3\ The services of CSW Services, as Rights Agent, will be 
provided at cost. CSW expects that such charges, if any, will be de 
minimis. As Rights Agent, CSW Services practically has no active 
duties unless the Rights become, if ever, exercisable, at which time 
the Rights Agent performs or causes to be performed services similar 
to a stock transfer agent. CSW Services is the transfer agent for 
the Common Stock.
    \4\ The Purchase price payable, and the number of shares of 
Common Stock (or other securities or property, as the case may be) 
issuable upon exercise of the Rights are subject to adjustment from 
time to time to prevent dilution. Prior to the date on which the 
Rights become exercisable, the Board may make such equitable 
adjustments as it deems appropriate in the circumstances in lieu of 
any adjustment otherwise required by the foregoing. No adjustment in 
the Purchase Price will be required until the time at which 
cumulative adjustments require an adjustment of at least 1% in the 
Purchase Price. No fractional shares of Common Stock will be issued 
and, in lieu thereof, a cash payment will be made based on the 
market price of the Common Stock on the last trading day prior to 
the date of exercise.
    \5\ Any of the provisions of the Rights Agreement may be amended 
by the Board without the consent of the holders of the Rights; 
provided, however, that on or after the Distribution Date (as 
defined below), the Rights Agreement may not be amended in any 
manner that would adversely affect the interests of the holders of 
the Rights.
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    Initially, the Rights would not be exercisable and would trade as 
an integral part of the outstanding shares of Common Stock. Subject to 
certain rights of CSW to redeem \6\ or exchange shares of Common Stock 
for \7\ the Rights, the Rights would become exercisable (i.e., Common 
Stock could be purchased at the Purchase Price pursuant to the Rights) 
and Rights Certificates representing the Rights would be distributed 
and would trade independently of the outstanding shares of Common Stock 
upon the occurrence of the following triggering events (``Triggering 
Events''): the earlier to occur of (i) 10 days after the first public 
announcement that any person or group (``Acquiring Person'') has 
acquired beneficial ownership of 15% or more of CSW's outstanding 
Common Stock (``Acquisition Event'') and (ii) 10 business days (unless 
extended by the Board of Directors) after any person or group has 
commenced a tender or exchange offer which would, upon its 
consummation, result in such person or group becoming an Acquiring 
Person (``Offer Event'') (the earlier of (i) and (ii) is hereafter 
referred to as the ``Distribution Date'').
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    \6\ The Rights may be redeemed, as a whole, at a Redemption 
Price of $.01 per Right, subject to adjustment, at the direction of 
the Board, at any time prior to the earlier of: (i) 10 days after 
the first public announcement that any person has become an 
Acquiring Person (as defined below); and (ii) the date of final 
expiration of the Rights. The Rights will expire on the tenth 
anniversary of the Record Date, unless earlier redeemed or exchanged 
by CSW.
    \7\ At any time after any person or group shall have become an 
Acquiring Person and before any person (other than CSW and certain 
related entities), together with its affiliates and associates, 
shall have become the beneficial owner of 50% or more of the 
outstanding shares of Common Stock, the Board may direct the 
exchange of shares of Common Stock for all or any part of the Rights 
(other than Rights of an Acquiring Person which become void) at the 
exchange rate of one share of Common Stock per Right, subject to 
adjustment.
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    When the Triggering Event is an Acquisition Event, the holders of 
the Rights (other than an Acquiring Person and certain transferees 
thereof whose Rights will become void) would immediately have the right 
to receive, for each Right exercised, Common Stock having a market 
value equal to two times the Purchase Price then in effect (``Discount 
Purchase Right''). When the Triggering Event is an Offer Event, the 
holders of the Rights (other than an Acquiring Person and certain 
transferees thereof whose Rights will become void) would be entitled to 
the Discount Purchase Right once a person or group commencing the 
tender or exchange offer becomes an Acquiring Person.
    In the event that, on or after the Distribution Date: (i) CSW is 
acquired by another person or entity not controlled by CSW 
(``Acquiror'') in a merger or other business combination transaction in 
which CSW Common Stock is exchanged for securities or other property; 
or (ii) 50% or more of CSW's consolidated assets or earnings power is 
sold or transferred to an Acquiror, each holder of a Right (except 
Rights which previously have been voided as discussed above) will 
thereafter be entitled to receive, for each Right exercised, common 
stock of the Acquiror having a market value equal to two times the 
Purchase Price then in effect.
    CSW states that the proposed Rights Plan is intended to deter 
hostile takeover attempts and/or attempts to acquire CSW in a manner or 
on terms which the Board determines are not in the best interests of 
all stockholders by enabling the Board to provide CSW stockholders with 
adequate time to assess properly a takeover bid without undue pressure. 
The Rights Plan is also intended to confront a potential acquiror with 
the possibility that the exercise of Rights by stockholders will 
substantially increase the number of shares of Common Stock outstanding 
and therefore the cost of acquiring control of CSW. CSW states that the 
Rights Plan will operate to maximize and preserve the value of CSW for 
its stockholders, in the event of an attempted hostile or unwanted 
takeover, but is not designed to prevent a proxy contest to replace 
members of the Board or frustrate a fair offer for the entire company 
which is in the best interests of stockholders.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-31618 Filed 12-2-97; 8:45 am]
BILLING CODE 8010-01-M