01—Abstract
Summary
Summary of the 10-K/A filed February 26, 2010. Cited figures are marked; the original filing is the authoritative source.
This excerpt is Part IV, Item 15 (Exhibits and Financial Statement Schedules) of Entergy Corporation's Form 10-K for the fiscal year ended December 31, 2009, filed February 26, 2010.
It contains no financial results, balance sheet, or operating metrics. The audited financial statements, auditor's report, and financial statement schedules are incorporated by reference as "previously filed," so this section cannot support an assessment of Entergy's earnings, cash flow, or leverage. Investors would need the full filing for that analysis.
The exhibit index does show the structure of Entergy's System-wide arrangements. Entergy Corporation acts as a holding company for its utility operating subsidiaries (Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy). Costs and power are shared through an Entergy System Agency Agreement, a Service Agreement with Entergy Services, a consolidated income tax allocation agreement, and System Energy's Grand Gulf availability and unit power sales arrangements.
Entergy also has a $3.5 billiona credit agreement dated August 2, 2007 with a syndicate of banks, plus senior note officer's certificates and a guarantee structure that supports subsidiary debt. Several filed-with-this-10-K items relate to executive compensation and governance. These include amendments to retention agreements for senior executives (J.
Wayne Leonard, Leo P. Denault, and Richard J.
Smith, all dated December 2009), a restricted unit agreement, a fifth amendment to the tax allocation agreement dated November 20, 2009, and amendments to the System Executive Continuity Plan effective January 1, 2010. Investors interested in governance or management retention should review these documents directly.
02—Key points
Key Highlights
- Financial statements and the auditor's report are incorporated by reference from prior filings, so this excerpt contains no reported revenue, earnings, or balance sheet data.
- Entergy's utility subsidiaries operate under shared System arrangements, including the Entergy System Agency Agreement (amended and restated effective January 1, 2008) and a Service Agreement with Entergy Services amended June 1, 2009.
- A Fifth Amendment dated November 20, 2009 to the Entergy Corporation and Subsidiary Companies Intercompany Income Tax Allocation Agreement was filed with this 10-K.
- Entergy maintains a $3.5 billion credit agreement dated August 2, 2007 with a broad syndicate of banks, with Citibank, N.A. as administrative agent.
- Executive retention and continuity arrangements were amended in December 2009 for CEO-level and senior executives (Leonard, Denault, Smith), and the System Executive Continuity Plan was amended effective January 1, 2010.
- Entergy-Koch, LP, a partnership with Koch Energy, is an incorporated agreement, reflecting Entergy's joint venture in its wholesale energy trading and marketing operations.
- XBRL interactive data files (INS, SCH, CAL, DEF, LAB, PRE) are filed with this 10-K, consistent with the phased-in XBRL reporting requirements for large filers.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-K/AFY2009filed February 26, 2010Financial Statements
FY2009 against FY2008
| Line item | FY2009FY2008 | Change |
|---|---|---|
| Revenue | $10.75B— | — |
| Operating Expenses | $8.46B$10.81B | −21.7% |
| Operating Income | $2.28B$2.28B | +0.1% |
| Interest Expense | $603.68M$608.92M | −0.9% |
| Net Income | $1.25B$1.24B | +0.8% |
| EPS (Basic) | $3.19$3.19 | 0.0% |
| EPS (Diluted) | $3.15$3.10 | +1.6% |
| Shares Outstanding (Basic) | 385.54M381.85M | +1.0% |
| Shares Outstanding (Diluted) | 391.68M402.02M | −2.6% |
05—Questions
Frequently Asked Questions
Does this section of the 10-K show Entergy's 2009 financial results?
No. Item 15 states that the financial statements, the auditor's report, and the financial statement schedules were previously filed. This excerpt lists exhibits only and does not include revenue, net income, cash flow, or balance sheet figures. Those must be obtained from the complete 10-K or the financial statements Entergy previously filed.
What major financing arrangements does Entergy have in place?
The exhibits reference a $3.5 billion revolving credit agreement dated August 2, 2007, an amendment to a 2005 credit agreement with Bayerische Hypo-und Vereinsbank, and an indenture with Deutsche Bank Trust Company Americas dated December 1, 2002. Officer's certificates for several senior notes (maturing in 2010 and 2011) are also referenced. The exhibits do not show outstanding balances or interest rates.
How do Entergy's utility subsidiaries share costs and power?
The exhibits describe a System Agency Agreement and a Service Agreement with Entergy Services for shared services, along with a consolidated income tax allocation agreement. System Energy's Grand Gulf nuclear plant output is sold to affiliates under Unit Power Sales Agreements, and its costs are recovered through Availability Agreements and Capital Funds Agreements. These arrangements are central to how Entergy's regulated subsidiaries allocate costs and income.
Did Entergy change executive retention or compensation arrangements around this filing?
Yes. The 10-K includes amendments to retention agreements with J. Wayne Leonard, Leo P. Denault, and Richard J. Smith, all effective in December 2009. It also includes a restricted unit agreement for Leonard and an amendment to the System Executive Continuity Plan effective January 1, 2010. These are marked as management contracts or compensatory plans. The exhibits do not disclose the terms or dollar amounts of the changes.
Which Entergy subsidiaries are covered by the guarantees and debt documents?
Guarantee agreements from Entergy Corporation cover Entergy Arkansas, Entergy Louisiana, and System Energy. Long-term debt instruments are referenced for System Energy, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, and Entergy Texas. Investors evaluating credit risk should review each subsidiary's debt documents and any guarantee obligations in the full filing.
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