As filed with the Securities and Exchange Commission on May 29, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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TUC Holding Company
TO BE KNOWN AS TEXAS UTILITIES COMPANY
(Exact name of registrant as specified in its charter)
TEXAS 75-2669310
(State or other (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
ENERGY PLAZA
1601 BRYAN STREET
DALLAS, TEXAS 75201
(214) 812-4600
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
ROBERT A. WOOLDRIDGE, ESQ. PETER B. TINKHAM, ESQ. ROBERT J. REGER, JR., ESQ.
Worsham, Forsythe Treasurer Reid & Priest LLP
& Wooldridge, L.L.P. Energy Plaza 40 West 57th Street
1601 Bryan Street 1601 Bryan Street New York, New York 10019
Dallas, Texas 75201 Dallas, Texas 75201 (212) 603-2000
(214) 979-3000 (214) 812-4600
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
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Approximate date of commencement of proposed sale to the
public: From time to time after this registration statement
becomes effective.
If the only securities being registered on this Form are
being offered pursuant to dividend or interest reinvestment
plans, please check the following box. [ ]
If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to Rule
415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment
plans, check the following box. [X]
If this form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and
list the Securities Act registration statement number of the
earlier effective registration statement for the same
offering. [ ]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
TITLE OF EACH MAXIMUM MAXIMUM
CLASS OF AMOUNT OFFERING AGGREGATE AMOUNT OF
SECURITIES TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER UNIT+ PRICE* FEE
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Common Stock,
without 3,000,000
par value . . . . shs. $33.3125 $99,937,500 $30,285
=========================================================================
+ Based on the average of the high and low prices of the common
stock of Texas Utilities Company (predecessor to the Company)
reported on the NYSE composite tape on May 21, 1997.
* Estimated solely for the purpose of calculating the registration
fee.
The registrant hereby amends this registration statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this registration statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the registration
statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
PURSUANT TO RULE 429, THE COMBINED PROSPECTUS FILED HEREWITH ALSO
RELATES TO REGISTRATION NO. 33-55931.
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<PAGE>
Information contained herein is subject to completion or
amendment. A registration statement relating to these securities
has been filed with the Securities and Exchange Commission.
These securities may not be sold nor may offers to buy be
accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any
sale of these securities in any State in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such State.
SUBJECT TO COMPLETION, DATED MAY 29, 1997
P R O S P E C T U S
Shares
TEXAS UTILITIES COMPANY
COMMON STOCK
Without Par Value
The Common Stock is listed on the New York, Chicago and Pacific
stock exchanges.
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DIRECT STOCK PURCHASE AND DIVIDEND REINVESTMENT PLAN
The Direct Stock Purchase and Dividend Reinvestment Plan
(Plan) of Texas Utilities Company, formerly the Automatic
Dividend Reinvestment and Common Stock Purchase Plan (Original
Plan), provides a convenient and economical way for holders of
the Common Stock of Texas Utilities Company (Company) and for
persons who are not shareholders to purchase shares of Common
Stock, without par value, of the Company (Common Stock) and to
reinvest cash dividends paid on shares of Common Stock.
Reference is made to "The Plan" for definitions of certain
capitalized terms.
The Plan, which is set forth in this Prospectus, reflects
certain changes to the Original Plan. Among these changes are
the following: (a) non-shareholders may enroll in the Plan by
making initial cash investments of $500 or more; (b) the maximum
amount of permitted cash investments is increased from $4,000 per
month to $100,000 per calendar year (cash investments per month
continue to be permitted at no less than $25); (c) cash
investments in the Plan may be made by electronic bank draft; (d)
participants may elect to reinvest cash dividends paid on all of
their shares of Common Stock, or they may designate a portion of
such shares on which dividends are paid in cash directly to the
participant with cash dividends on the remaining shares to be
reinvested in the Plan (partial reinvestment); (e) the Plan will
invest accumulated cash investments in shares of Common Stock
weekly, instead of monthly; (f) certificated shares may be
deposited into the Plan for safekeeping and converted into shares
credited to participants' accounts (Plan Shares), which may be
sold on behalf of participants, and (g) a fee will be deducted
from the initial cash investment made by a non-shareholder and a
fee, in addition to the commission which is currently paid by
participants, will be deducted from the proceeds of Plan Shares
sold by the Plan, to cover the costs of such transactions to the
Plan. Brokerage fees in connection with purchases of Plan Shares
with reinvested dividends and optional cash investments by Plan
participants will continue to be paid by the Company. For
further information concerning the Plan, see "The Plan".
At the date of the Mergers, as described under "The Company
and Its Subsidiaries", participants in the dividend reinvestment
plans of the predecessors to the Company were automatically
enrolled as participants in the Plan. No action is required of a
participant in the dividend reinvestment plan of a predecessor of
the Company to become a participant in the Plan.
Non-shareholders, if they are persons of legal age who are
residents of any of the fifty states of the United States and the
District of Columbia or entities organized in any such
jurisdiction, may enroll in the Plan by mailing a signed
Authorization Form along with an initial cash investment of $500
or more to Texas Utilities Shareholder Services, Dividend
Reinvestment Plan, P.O. Box 225249, Dallas, Texas 75222-5249. A
<PAGE>
holder of record of shares of Common Stock of the Company who was
not a participant in the dividend reinvestment plan of a
predecessor to the Company also may enroll in the Plan by signing
and mailing an Authorization Form. An Authorization Form may be
obtained from Texas Utilities Shareholder Services (Toll-free
phone number 1-800-828-0812).
Shares of Common Stock purchased under the Plan will be
either issued and outstanding shares purchased in the open market
by an Independent Broker (Independent Broker) or original issue
shares acquired directly from the Company. For details about the
price of such shares purchased in the open market or acquired
directly from the Company, see "The Plan - Share Purchases and
Price".
This Prospectus relates to the offer and sale under the Plan
of 3,000,000 newly registered shares of Common Stock of the
Company as well as shares of Common Stock previously
registered by Texas Energy Industries, Inc., (formerly Texas
Utilities Company), predecessor to the Company, that remain
unsold under the Original Plan. Participants are advised to
retain this Prospectus for future reference.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR BY ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
JUNE , 1997
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
The following documents, which have been filed by the
Company or its predecessors with the Securities and Exchange
Commission (Commission) pursuant to the Securities Exchange Act
of 1934, as amended (1934 Act) are incorporated herein by
reference:
(a) Annual Report of Texas Utilities Company (TEI) on
Form 10-K for the year ended December 31, 1996,
File No. 1-3591 (1996 TEI 10-K).
(b) Quarterly Report of TEI on Form 10-Q for the
Quarter ended March 31, 1997, File No. 1-3591 (TEI
10-Q).
(c) Annual Report of ENSERCH Corporation (ENSERCH) on
Form 10-K for the year ended December 31, 1996,
File No. 1-3183 (1996 ENSERCH 10-K).
(d) Quarterly Report of ENSERCH on Form 10-Q for the
Quarter ended March 31, 1997, File No. 1-3183
(ENSERCH 10-Q).
(e) Current Report of ENSERCH on Form 8-K dated
January 14, 1997, File No. 1-3183.
(f) Current Report of ENSERCH on Form 8-K dated March
12, 1997, File No. 1-3183.
All documents filed by the Company and its predecessors
pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act
after the date of this Prospectus and prior to the termination of
the offering hereunder shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the
date of filing of such documents; provided, however, that the
documents enumerated above or subsequently filed by the Company
pursuant to Section 13 of the 1934 Act prior to the filing with
the Commission of the Company's most recent Annual Report on Form
10-K shall not be incorporated by reference in this Prospectus or
be a part hereof from and after the filing of such Annual Report
on Form 10-K. The documents which are incorporated by reference
in this Prospectus are sometimes hereinafter referred to as the
"Incorporated Documents."
Any statement contained in an Incorporated Document shall be
deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in
any other subsequently filed document which is deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Prospectus.
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO
EACH PERSON, INCLUDING ANY BENEFICIAL OWNER, TO WHOM A COPY OF
THIS PROSPECTUS HAS BEEN DELIVERED, ON THE WRITTEN OR ORAL
REQUEST OF ANY SUCH PERSON, A COPY OF ANY AND ALL OF THE
DOCUMENTS REFERRED TO ABOVE WHICH HAVE BEEN OR MAY BE
INCORPORATED IN THIS PROSPECTUS BY REFERENCE, OTHER THAN EXHIBITS
TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE SPECIFICALLY
INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS). REQUESTS FOR
SUCH COPIES SHOULD BE DIRECTED TO TEXAS UTILITIES SHAREHOLDER
SERVICES, DIVIDEND REINVESTMENT PLAN, P.O. BOX 225249, DALLAS,
TEXAS 75222-5249, TOLL-FREE TELEPHONE NUMBER (800) 828-0812.
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<PAGE>
AVAILABLE INFORMATION
The Company is, and its predecessors have been, subject to
the informational requirements of the 1934 Act and in accordance
therewith the Company files, and its predecessors have filed,
reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information
filed by the Company and its predecessors can be inspected and
copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549, and at the following Regional Offices of the Commission:
Chicago Regional Office, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661; and New York Regional Office, 7 World
Trade Center, Suite 1300, New York, New York 10048. Copies of
such material can also be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. In addition, the Commission
maintains a World Wide Web site (http://www.sec.gov) that
contains reports and other information filed by the Company. The
Common Stock of the Company is listed on the New York, Chicago
and Pacific stock exchanges, where reports, proxy statements and
other information concerning the Company may be inspected.
Reports, proxy statements and other information concerning the
Company's predecessors may be inspected at the New York and
Chicago stock exchanges and, in the case of Texas Energy
Industries, Inc. (TEI), formerly Texas Utilities Company, also
may be inspected at the Pacific Stock Exchange.
THE COMPANY AND ITS SUBSIDIARIES
The Company is a Texas corporation organized in 1996 for the
purpose of becoming the holding company for TEI, formerly Texas
Utilities Company, and ENSERCH Corporation (ENSERCH) upon the
mergers of TEI and ENSERCH into wholly owned subsidiaries of the
Company (Mergers). At the effective time of the Mergers, (i) the
Company changed its name to Texas Utilities Company, (ii) TEI
changed its name from Texas Utilities Company to Texas Energy
Industries, Inc., (iii) the Company became the sponsor of the
Plan, (iv) all shares of common stock of TEI held by the Plan
were automatically converted into an equal number of shares of
Common Stock of the Company, and (v) each share of common stock
of ENSERCH held under the ENSERCH dividend reinvestment plan was
automatically converted into share of Common Stock of
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the Company to be held by the Plan. Since the Mergers, only
shares of Common Stock of the Company are sold under the Plan.
TEI, a Texas corporation, is a holding company whose
principal subsidiary, Texas Utilities Electric Company (TU
Electric), is an operating public utility company engaged in the
generation, purchase, transmission, distribution and sale of
electric energy in the north central, eastern and western
portions of Texas, an area with a population estimated at
5,890,000. Two other subsidiaries of TEI are engaged directly or
indirectly in public utility operations: (i) Southwestern
Electric Service Company, which is engaged in the purchase,
transmission, distribution and sale of electric energy in ten
counties in eastern and central parts of Texas, with a population
estimated at 126,900 and (ii) Texas Utilities Australia Pty.
Ltd., which in 1995 acquired the common stock of Eastern Energy
Limited, a company engaged in the purchase, distribution and sale
of electric energy to approximately 481,000 customers in the
Melbourne area of Australia. Neither Southwestern Electric
Service Company nor Eastern Energy Limited generates any
electricity. TEI also has other wholly owned subsidiaries which
perform specialized functions within the Texas Utilities Company
system.
ENSERCH, a Texas corporation, is an integrated company
focused on natural gas. Its major business segments are natural
gas pipeline, processing and marketing; natural gas distribution,
and power generation. Through these business segments, ENSERCH
is engaged in (i) owning and operating interconnected natural gas
transmission lines, underground storage reservoirs, compressor
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<PAGE>
stations and related properties in Texas; gathering and
processing natural gas to remove impurities and extract liquid
hydrocarbons for sale, and the wholesale and retail marketing of
natural gas in several areas of the United States, (ii) owning
and operating approximately 550 local gas utility distribution
systems in Texas, and (iii) developing , financing and operating
electric power generating plants and cogeneration facilities
worldwide and operating thermal energy plants for large building
complexes, such as universities and medical centers, in Texas,
and developing gas distribution systems in Mexico and South
America.
Texas Utilities Services Inc. (TU Services) provides
financial, accounting, information technology, environmental
services, customer services, personnel, procurement and other
administrative services at cost to the Texas Utilities Company
system. TU Services, acting under the name of Texas Utilities
Shareholder Services, is transfer agent, registrar and dividend
paying agent with respect to the common stock of the Company and
the preferred stock and preferred securities of TU Electric and
is also agent for participants under the Plan.
The principal executive offices of the Company are located at
1601 Bryan Street, Dallas, Texas 75201-3411; the telephone number
is (214) 812-4600.
USE OF PROCEEDS
If shares are purchased for the Plan in the open market, the
Company will not receive any proceeds therefrom. The proceeds to
be received by the Company from the sales of shares of original
issue Common Stock, together with funds from operations and other
sources, are expected to be used to make additional investments
in the common stocks of its subsidiary companies, in amounts and
at times presently not determined, to enable such subsidiaries to
fund construction programs, redeem their securities or retire
them as they mature and to repay short term borrowings incurred
for similar purposes. Proceeds may also be used by the Company
for other corporate purposes which may include acquisitions and
for the repayment of short-term borrowings incurred for such
purposes. Proceeds may be temporarily invested in short-term
instruments pending their application to the foregoing purposes.
The Company is unable to determine either the number of shares of
Common Stock that may be issued or purchased under the Plan or
the proceeds, if any, that may be received from the sale of such
shares.
4
<PAGE>
THE PLAN
The Direct Stock Purchase and Dividend Reinvestment Plan
(Plan) of Texas Utilities Company (Company), formerly the
Automatic Dividend Reinvestment and Common Stock Purchase Plan of
the Company, has been instituted for the benefit and convenience
of the holders of shares of the common stock of the Company
(Common Stock) and for others who want to invest in Common Stock
through the Plan. Participation in the Plan is entirely
optional.
PURPOSE AND ADVANTAGES
1. WHAT IS THE PURPOSE OF THE PLAN?
The purpose of the Plan is to provide a convenient and
economical way for both shareholders and Eligible Non-
shareholders (as defined below) to purchase shares of Common
Stock, including an initial purchase of shares of Common Stock.
Once a participant is enrolled in the Plan, additional shares of
Common Stock may be purchased by reinvesting cash dividends paid
on all or a portion of the shares of the Common Stock held by
such participant and by making optional cash investments. As
determined by the Company, the shares may be purchased in the
open market by an independent broker (Independent Broker) or
acquired from the Company as original issue shares of the
Company's authorized Common Stock.
2. WHAT ARE THE ADVANTAGES OF THE PLAN?
The Plan allows for a participant to designate the portion
of shares held by such participant for which dividends shall be
reinvested and to make additional optional cash investments.
Full investment of funds is possible because the Plan permits the
purchase of fractions of shares, as well as whole shares, to be
credited to participants' accounts. Participants in the Plan do
not pay any commissions or service charges in connection with
purchases through the Plan. However, a fee of $10 will be
charged in connection with the initial purchase of shares by
Eligible Non-shareholders. Participants can avoid responsibility
for the safekeeping of certificates for shares of Common Stock
credited to their accounts under the Plan (Plan Shares) and are
furnished quarterly statements of account to provide simplified
record keeping. Plan Shares may be sold through the Plan.
Participants selling shares through the Plan will be charged a
fee of $10 to cover the costs to the Plan of each sales
transactions, plus any applicable brokerage commission and
transfer taxes in connection with such sales.
ELIGIBILITY
3. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
Any holder of record of shares of the Common Stock and any
non-shareholder that is a person of legal age and a resident of
one of the fifty states of the United States or the District of
Columbia or an entity organized in any such jurisdiction
(Eligible Non-shareholder), may become a participant in the Plan.
Shares of Common Stock for which dividends are reinvested by the
Plan must be registered in the name of the Plan participant. If
a beneficial owner of shares of the Common Stock registered in
another name wants the dividends on such shares to be reinvested
by the Plan, he or she must become a holder of record by having
such shares transferred into his or her name.
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<PAGE>
PARTICIPATION
4. WHAT STEPS MUST BE TAKEN TO PARTICIPATE IN THE PLAN?
The Company's predecessor companies, Texas Energy Industries,
Inc., formerly Texas Utilities Company, and ENSERCH Corporation
were merged into subsidiaries of the Company and participants in
the dividend reinvestment plans of such predecessor companies
were automatically enrolled as participants in the Plan. No
action is required of a participant in the dividend reinvestment
plan of a predecessor of the Company to become a participant in
the Plan.
Holders of shares of Common Stock may enroll in the Plan at
any time by filling out a Plan authorization form (Authorization
Form) and returning it to Texas Utilities Shareholder Services
(Shareholder Services). An Eligible Non-shareholder may enroll
in the Plan by completing and returning an Authorization Form,
together with a check in an amount not less than $500 nor more
than $100,000, made payable to Texas Utilities Shareholder
Services. A prospectus relating to the Plan and an Authorization
Form may be obtained from Shareholder Services (see
Administration).
In completing the Authorization Form, the new participant
must make one of the following elections:
(a) FULL DIVIDEND REINVESTMENT AND OPTIONAL CASH
INVESTMENTS: automatically reinvest any cash
dividends on Plan Shares and on shares of the
Common Stock registered in his or her name and
held by the participant in certificated form
(Registered Shares) and, at the discretion of the
participant, make optional cash investments; or
(b) PARTIAL DIVIDEND REINVESTMENT AND OPTIONAL CASH
INVESTMENTS: receive cash payment of dividends on
a portion of the participant's Registered Shares
and/or a portion of the Plan Shares and
automatically reinvest the cash dividends on the
remainder of such shares and, at the discretion of
the participant, make optional cash investments;
or
(c) OPTIONAL CASH INVESTMENT ONLY: continue to receive
cash dividends on all the participant's Registered
Shares and Plan Shares but, at the discretion of
the participant, make optional cash investments.
Initial cash investments by an Eligible Non-shareholder may
not be less than $500 nor more than $100,000. Otherwise,
optional cash investments by a participant may not be less than
$25 per investment nor aggregate more than $100,000 per calendar
year, including the initial cash investment by an Eligible Non-
shareholder. Participants are under no obligation to make any
optional cash investments.
5. HOW DO THE "FULL DIVIDEND REINVESTMENT AND OPTIONAL
CASH INVESTMENT" FEATURE AND THE "PARTIAL DIVIDEND
REINVESTMENT AND OPTIONAL CASH INVESTMENT" FEATURE OF
THE PLAN WORK?
An Authorization Form marked "Full Dividend Reinvestment and
Optional Cash Investment" directs Shareholder Services to apply
to the purchase of additional shares of Common Stock (i) all of
the participant's cash dividends on the shares of such
participant's Registered Shares and Plan Shares and (ii) any
optional cash investments received from the participant.
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<PAGE>
An Authorization Form marked "Partial Dividend Reinvestment
and Optional Cash Investment" directs Shareholder Services to
continue to make cash payments of dividends on the portion of the
participant's Registered Shares and/or the portion of the Plan
Shares indicated on the Authorization Form and to apply to the
purchase of additional shares of Common Stock (i) all of the
remaining cash dividends on the shares of such participant's
Registered Shares and Plan Shares and (ii) any optional cash
investments received from the participant.
Receipt of an Authorization Form by Shareholder Services on
or before the record date for a quarterly cash dividend entitles
the holder of shares of Common Stock electing dividend
reinvestment to have dividends on all or a portion of such shares
registered in such holder's name used to acquire additional
shares of Common Stock for such holder's account. If the
Authorization Form is received by Shareholder Services after such
record date but before the quarterly dividend payment date
(Dividend Payment Date), which is typically the first business
day of January, April, July and October, such dividends will be
paid in cash to such holder and reinvestment of cash dividends
will not start until the next Dividend Payment Date. The record
date for cash dividends on the Common Stock is approximately
three to four weeks prior to the Dividend Payment Date. FOR
EXAMPLE: If the record date for the July 1 dividend payment were
June 6, an Authorization Form would have to be received by
Shareholder Services on or before June 6, in order for the
eligible holder of shares to participate in dividend reinvestment
on July 1. If the Authorization Form were received after June 6,
the July 1 dividend would be paid in cash and the participant's
reinvestment of cash dividends would commence with the next
Dividend Payment Date of October 1.
Any optional cash investments received from participants in
the "Full Dividend Reinvestment and Optional Cash Investment"
feature and the "Partial Dividend Reinvestment and Optional Cash
Investment" feature will be treated in the same manner as cash
investments received under the "Optional Cash Investment Only"
feature described below.
6. HOW DOES THE "OPTIONAL CASH INVESTMENT ONLY" FEATURE OF
THE PLAN WORK?
If the "Optional Cash Investment Only" box on the
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Authorization Form is checked, the Company will pay cash
dividends to the participant on such participant's Registered
Shares and Plan Shares. Shareholder Services will apply any
optional cash investments received from the participant to the
purchase of additional shares of the Common Stock under the Plan
on the next weekly investment date, which is the first business
day of the week (Investment Date).
Optional cash investments should be made by check or money
order payable to Texas Utilities Shareholder Services. Optional
cash investments also may be made on a regular basis by
electronic funds transfer pursuant to the Automatic Electronic
Investment feature described below. Each optional cash
investment must be in an amount not less than $25. The aggregate
of all optional cash investments made by each participant may not
exceed $100,000 in any calendar year, including the initial cash
investment made by an Eligible Non-shareholder. No interest will
----------------
be paid by the Company or Shareholder Services on amounts
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forwarded by a holder of shares to Shareholder Services for
-----------------------------------------------------------
optional cash investment and held until investment. A
---------------------------------------------------
participant may, without terminating participation in the Plan,
recover an optional cash investment held for investment in Common
Stock by contacting Shareholder Services not later than two
business days prior to the Investment Date. The same amount of
money need not be invested each week and there is no obligation
to make an optional cash investment each week. Cash dividends on
shares acquired with optional cash investments and held in the
Plan, at the election of the participant, are reinvested in
additional shares of the Common Stock or directly paid to the
participant on each Dividend Payment Date.
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<PAGE>
7. HOW IS AN OPTIONAL CASH INVESTMENT MADE?
An optional cash investment may be made by a participant when
joining the Plan by enclosing with the Authorization Form a check
made payable to Texas Utilities Shareholder Services. Thereafter
payments for optional cash investments may be made by the
automatic electronic investment feature or by sending a check or
money order, which should be accompanied either by the form
provided with the participant's statement of account or the
participant's account number or social security number.
8. WHAT IS THE AUTOMATIC ELECTRONIC INVESTMENT FEATURE OF
THE PLAN AND HOW DOES IT WORK?
An Automatic Electronic Investment Feature is available to
make repetitive optional cash investments more convenient. A
participant may make optional cash investments aggregating not
more than $100,000 per year by means of monthly electronic funds
transfers (Automatic Electronic Investments) of not less than $25
from a predesignated U.S. account. Automatic Electronic
Investments may be made from accounts at any bank, savings
association or credit union that is a member of the National
Automated Clearing House Association (NACHA).
To initiate Automatic Electronic Investments, a participant
must complete and sign an Automatic Electronic Investment
Authorization Card (Authorization Card), designating, among other
things, the amount to be withdrawn each month and the account
from which funds are to be drawn, and return it to Shareholder
Services. A voided blank check is also requested. A
participant's election to use the Automatic Electronic Investment
feature will become effective as promptly as practicable after
the Authorization Card is processed.
Once Automatic Electronic Investment is initiated, funds will
be withdrawn from the participant's designated account on the
20th day of each month (or, if the 20th day is not a business
day, the first business day thereafter), and will be invested in
Common Stock beginning on the next Investment Date following the
date of such withdrawal.
Participants may change the amounts of their future Automatic
Electronic Investments by completing and submitting to
Shareholder Services a new Authorization Card. Participants may
terminate their Automatic Electronic Investment by notifying
Shareholder Services in writing. Such requests will be processed
and the participant's election will become effective as promptly
as practicable.
Electronic direct deposit of cash dividends on Common Stock
that Participants elect to receive is also available through
Shareholder Services.
9. HOW MAY A PARTICIPANT CHANGE HIS OR HER ELECTION OPTION
UNDER THE PLAN?
A participant may change election options by signing a new
Authorization Form and returning it to Shareholder Services, or
by written request. Any instruction from a participant directing
such a change must be received by Shareholder Services on or
before the record date in order to be effective on the next
Dividend Payment Date.
SHARE PURCHASES AND PRICE
10. WHAT IS THE SOURCE OF SHARES ACQUIRED UNDER THE PLAN?
Shares of Common Stock acquired under the Plan are either
purchased in the open market by an Independent Broker on behalf
of the Plan or acquired from the Company as original issue shares
as determined by the Company. The shares are registered with the
Securities and Exchange Commission prior to offer and sale.
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<PAGE>
11. HOW MANY SHARES ARE PURCHASED UNDER THE PLAN?
The number of shares to be purchased for each participant
depends upon the amount of cash dividends reinvested and/or
optional cash investments made and the purchase price of the
Common Stock. (See Foreign Holders of Shares for certain
restrictions on reinvestment of cash dividends applicable to
residents of a foreign country.) Each participant's account is
credited with that number of shares, including fractional shares
computed to three decimal places, equal to the total cash amount
to be invested or reinvested divided by the purchase price per
share.
12. WHAT WILL BE THE PRICE OF SHARES OF COMMON STOCK
PURCHASED UNDER THE PLAN?
(a) OPEN MARKET PURCHASES. Shares of the Common Stock
purchased in the open market will be acquired for the Plan by an
Independent Broker. The price of such shares will be the
weighted average price (excluding any related brokerage fees,
commissions or other service charges) paid for all shares
acquired by the Independent Broker during the "Investment Period"
in which the open market purchases are made. Each Investment
Period commences on an Investment Date and continues through and
includes the date preceding the next succeeding Investment Date.
With respect to any open market purchases made under the
Plan, subject to any limitations imposed by federal or state
securities laws, the Independent Broker will have full discretion
as to all matters relating to purchases, including determination
of the number of shares, if any, to be purchased on any day in an
Investment Period, the time of day, the price paid for such
shares, the markets in which such shares are to be purchased
(including on any securities exchange or in the over-the-counter
market) and the persons (including brokers or dealers) from or
through whom such purchases are made.
(b) ORIGINAL ISSUE SHARES ACQUIRED FROM THE COMPANY. The
price of shares to be acquired from the Company is the average of
the daily averages of the high and low sales prices for the
Common Stock as reported on the consolidated tape for New York
Stock Exchange listed securities administered by the Consolidated
Tape Association for the applicable Investment Period.
SAFEKEEPING
13. WHAT IS THE PLAN SAFEKEEPING SERVICE?
At the time of enrollment, or at any later time, participants
may take advantage of the Plan's cost-free safekeeping services.
Registered Shares held in certificated form by a participant may
be deposited into the Plan, to be held by Shareholder Services or
its nominee, by delivering a completed Authorization Form and
such certificates to Shareholder Services. Such certificates
should not be endorsed. The shares of Common Stock so deposited
will be transferred into the name of Shareholder Services or its
nominee, as custodian, and credited to the participant's account
as Plan Shares. Thereafter, such Plan Shares will be treated in
the same manner as Plan Shares purchased under the Plan.
References herein to Plan Shares include shares of Common Stock
deposited into the Plan for safekeeping unless otherwise
indicated. Cash dividends paid on Plan Shares that were
deposited into the Plan for safekeeping will be distributed or
reinvested in shares of Common Stock in accordance with the
Participant's election designated on his or her Authorization
Form.
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SALES OF PLAN SHARES
14. HOW CAN A PARTICIPANT SELL PLAN SHARES?
A participant may request Shareholder Services at any time to
sell all or a portion of his or her Plan Shares by delivering to
Shareholder Services a written request. Shareholder Services
will instruct an Independent Broker to sell such shares as soon
as practicable after processing the request and will transmit to
the participant the proceeds of the sale (less transaction fees,
brokerage fees and commissions and any transfer taxes). Unless
otherwise specified by the Participant, if fewer than all of a
participant's Plan Shares are to be sold, sale instructions will
be applied first to Plan Shares on which cash dividends are being
reinvested.
SALE OF PLAN SHARES BETWEEN RECORD DATE AND DIVIDEND PAYMENT
DATE:
If instructions for the sale of Plan Shares on which cash
dividends are not being reinvested are received by Shareholder
Services on or after the record date for a Dividend Payment Date
but before the Dividend Payment Date, the sale of such Plan
Shares will be accomplished as described above in the first
paragraph of this section and the cash dividends on such shares
will be paid on the Dividend Payment Date in the usual manner.
If instructions for the sale of a portion of Plan Shares on
which cash dividends are being reinvested are received by
Shareholder Services on or after the record date for a Dividend
Payment Date but before the Dividend Payment Date, the sale of
such Plan Shares will be accomplished as described above in the
first paragraph of this section and the dividends on such shares
will be credited to the participant's account under the Plan and
reinvested in shares of Common Stock in accordance with the terms
of the Plan.
If instructions for the sale of all Plan Shares are received
on or after the record date for a Dividend Payment Date but
before the fifth business day preceding the Dividend Payment
Date, the sale of such Plan Shares will be accomplished as
described above in the first paragraph of this section and the
dividend will be paid in cash on the Dividend Payment Date.
However, if sale instructions are received after the fifth
business day preceding the Dividend Payment Date, the dividends
on such shares paid on the Dividend Payment Date will be credited
to the participant's account under the Plan and reinvested in
shares of Common Stock in accordance with the terms of the Plan.
The sale instructions will be implemented after the applicable
Dividend Payment Date at which time all of the participant's Plan
Shares, including the shares purchased with the most recently
paid dividends, will be sold and the proceeds transmitted to the
Participant.
15. HOW CAN A PARTICIPANT SELL REGISTERED SHARES THROUGH
THE PLAN?
Registered Shares may be converted to Plan Shares and either
held in safekeeping for the participant or sold by the Plan for
the participant according to the procedures described above.
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TERMINATION OF PARTICIPATION
16. WHEN AND HOW MAY A PARTICIPANT TERMINATE PARTICIPATION
IN THE PLAN?
A participant may at any time terminate his or her
participation in the Plan by delivering to Shareholder Services a
written request at the address set forth herein under
Administration.
When a participant terminates participation in the Plan, or
the Company terminates the Plan, certificates for whole shares of
the Common Stock credited to the participant's account under the
Plan are issued and a cash payment is made for any fraction of a
share. If the request to terminate is received by Shareholder
Services prior to the fifth day preceding a Dividend Payment Date
dividends which would have been reinvested under the Plan in the
absence of such termination request will be paid to the
terminating participant in cash.
If the request to terminate is received by Shareholder
Services on or after the fifth day preceding a Dividend Payment
Date, the dividends paid on such Dividend Payment Date and
designated for reinvestment under the Plan will be invested in
shares of Common Stock through the Plan in accordance with the
terms of the Plan. The termination will take place after such
Dividend Payment Date, at which time certificates for whole
shares of Common Stock, including the newly purchased shares,
will be issued and a cash payment made for any fraction of a
share.
Any optional cash investments which have been received by
Shareholder Services before receipt of a request to terminate
will be invested under the Plan unless the request to terminate
is received before the first day of the Investment Period during
which the optional cash investment was to have been used to
purchase shares of Common Stock. If a timely request to
terminate is received by Shareholder Services, optional cash
investments being held for investment will be returned to the
terminating participant.
All subsequent cash dividends on shares of Common Stock, if
any, will be paid directly to the former participant. A former
participant may enroll in the Plan as a new participant by
sending a completed Authorization Form and, in the case of an
Eligible Non-shareholder, an initial investment of $500 to
Shareholder Services (see Participation and Expenses).
EXPENSES
17. WHAT FEES AND CHARGES ARE MADE TO A PARTICIPANT IN
CONNECTION WITH PURCHASES OR SALES UNDER THE PLAN?
Participants in the Plan do not pay any commissions or
service charges for purchases of Common Stock through the Plan.
A transaction fee of $10 per transaction will be charged to the
account of an Eligible Non-shareholder making an initial
investment at enrollment. A transaction fee of $10 per
transaction will be charged to the account of a participant
selling Plan Shares. A participant also pays any applicable
brokerage commissions and transfer taxes in connection with sales
of such participant's Plan Shares. All other costs of
administering the Plan will be paid by the Company. There is no
charge for safekeeping of Plan Shares. Participants pay any
applicable transfer taxes on sales of their Plan Shares.
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ADMINISTRATION
18. WHO ADMINISTERS THE PLAN?
Shareholder Services administers the Plan, keeps records,
sends quarterly statements of account to participants and
performs other duties relating to the Plan.
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All notices, inquiries and requests concerning the Plan,
EXCEPT for optional cash investments, should be mailed to:
TEXAS UTILITIES SHAREHOLDER SERVICES
P. O. BOX 225249
DALLAS, TX 75222-5249
Optional cash investments, other than by automatic electronic
investment, should be mailed to:
TEXAS UTILITIES SHAREHOLDER SERVICES
P. O. BOX 650459
DALLAS, TX 75265-0459
Please include your shareholder account number, social
security number and daytime telephone number on all
correspondence, checks or money orders. Persons who wish to
communicate by telephone with Shareholder Services concerning the
Plan may do so by calling either of the following numbers:
TOLL-FREE (800) 828-0812
LOCAL (214) 812-8100
THE FOLLOWING INFORMATION IS AVAILABLE THROUGH THE AUTOMATED
TELEPHONE SYSTEM:
General transfer instructions as well as information
regarding lost certificates
Information about the Plan, which includes:
o How the Plan works
o Optional cash investment acceptance periods
o Information regarding withdrawals from the Plan as
well as requests for duplicate Plan statements
Information about an individual account, which includes:
o Account balance information including the number
of shares of the Common Stock held in the account
and the aggregate of optional cash investments not
yet invested.
o Year-to-date reportable income amounts
o Requests for duplicate 1099DIV's
Dividend payment and record date information
The option of speaking to a Shareholder Account
Representative
---------------------------------------------------------------
NEITHER TEXAS UTILITIES COMPANY NOR TEXAS UTILITIES
SHAREHOLDER SERVICES CAN ASSURE A PARTICIPANT OF A PROFIT OR
PROTECT A PARTICIPANT AGAINST A LOSS ON THE SHARES PURCHASED
UNDER THE PLAN.
REPORTS TO PARTICIPANTS
19. WHAT KIND OF REPORTS WILL BE SENT TO THE PARTICIPANTS
IN THE PLAN?
Each participant in the Plan will receive a quarterly
statement of account. Quarterly statements are the participant's
record of the cost of such participant's Plan purchases,
withdrawals, and shares certificated during the calendar year and
should be retained for tax purposes. In addition, participants
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receive a prospectus relating to the Plan as well as copies of
all reports sent to the holders of shares of the Common Stock.
(See Federal Income Tax Matters.)
CERTIFICATES FOR SHARES
20. WILL CERTIFICATES BE ISSUED TO PARTICIPANTS FOR SHARES
OF COMMON STOCK UNDER THE PLAN?
Certificates for shares of the Common Stock purchased on
behalf of participants in the Plan and credited to their accounts
under the Plan as Plan Shares are issued in the name of
Shareholder Services, or its nominee, and are held by Shareholder
Services for the benefit of the participants. The number of Plan
Shares is shown on the participant's quarterly statement of
account.
Certificates for any number of whole Plan Shares will be
issued upon the written request of a participant, and the related
Plan Shares shall be withdrawn from the participant's account.
The request should be mailed to Shareholder Services at the
address set forth herein under Administration. Any remaining
whole shares, and any fraction of a share, will continue to be
held in the participant's account as Plan Shares (see Termination
of Participation). Certificates for fractions of shares will not
be issued under any circumstances. Unless otherwise requested by
the participant, future cash dividends on the shares for which
certificates are issued will continue to be distributed or
reinvested in accordance with the participant's election.
Plan Shares may not be pledged. A participant who wishes to
pledge such shares must request that certificates for the shares
be issued in such participant's name.
Accounts under the Plan are maintained in the names in which
certificates of the participants were registered at the time they
entered the Plan. Consequently, certificates for whole shares
are similarly registered when issued to participants.
OTHER STOCK TRANSACTIONS
21. IF THE COMPANY ISSUES A STOCK DIVIDEND OR DECLARES A
STOCK SPLIT, HOW IS THE COMMON STOCK HELD UNDER THE
PLAN AFFECTED?
Any stock dividends or split shares distributed on Plan
Shares will be added to such participant's account. Stock
dividends or split shares distributed on a participant's
Registered Shares will be mailed directly to the participant in
the same manner as to holders of shares who are not participating
in the Plan.
22. IF THE COMPANY SELLS ADDITIONAL SHARES OF COMMON STOCK
THROUGH A RIGHTS OFFERING, HOW WILL THE PARTICIPANT'S
ENTITLEMENT BE COMPUTED?
In a rights offering, warrants representing rights on all of
a participant's Registered Shares and also whole Plan Shares will
be mailed directly to the participant in the same manner as to
holders of shares who are not participating in the Plan.
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<PAGE>
VOTING OF SHARES
23. HOW WILL A PARTICIPANT'S SHARES OF COMMON STOCK BE
VOTED AT MEETINGS OF SHAREHOLDERS OF THE COMPANY?
Each participant in the Plan receives a proxy form indicating
the total number of whole shares of the Common Stock held by the
participant, including Registered Shares and whole Plan Shares,
and the participant is entitled to vote all such shares at any
meeting of the shareholders of the Company.
RESPONSIBILITY OF COMPANY, THE INDEPENDENT BROKER AND SHAREHOLDER
SERVICES
24. WHAT ARE THE LIMITATIONS OF LIABILITY OF THE COMPANY,
THE INDEPENDENT BROKER AND SHAREHOLDER SERVICES FOR
THEIR ACTS OR OMISSIONS UNDER THE PLAN?
In administering the Plan, none of the Company, the
Independent Broker or Shareholder Services will be liable for any
act done in good faith, or for any good faith omission to act,
including, without limitation, any claims of liability arising
out of failure to terminate a participant's account upon the
participant's death, prior to receipt of notice in writing of
such death. Participants should recognize that none of the
Company, the Independent Broker or Shareholder Services can
assure a participant of a profit, or protect a participant
against a loss, on the shares of the Common Stock of the Company
purchased under the Plan. Participation in the Plan is at the
sole discretion, risk and responsibility of each participant.
FOREIGN HOLDERS OF SHARES
25. WHAT PROVISIONS ARE MADE FOR FOREIGN SHAREHOLDERS?
In the case of a foreign holder of shares who is
participating in the Plan and whose dividends are subject to
United States income tax withholding, Shareholder Services
applies to the purchase of the shares of the Common Stock an
amount equal to the net cash dividend after the deduction of
taxes withheld. Optional cash investments received from foreign
holders of shares of the Common Stock must be in United States
dollars.
MODIFICATION OR TERMINATION
26. TO WHAT EXTENT MAY THE PLAN BE MODIFIED, SUSPENDED OR
TERMINATED BY THE COMPANY?
The Company, by a majority vote of its Board of Directors at
a duly held meeting, reserves the right to suspend, modify, amend
or terminate the Plan at any time. Notice of any such
suspension, modification, amendment or termination will be mailed
to all participants.
The Company may elect not to offer or sell its Common Stock
under the Plan to participants residing in any jurisdiction or
foreign country where, in the judgment of the Company, the burden
or expense of compliance with applicable blue sky or securities
laws make such offer or sale there impracticable or inadvisable.
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FEDERAL INCOME TAX MATTERS
FEDERAL INCOME TAX CONSEQUENCES
The Federal income tax consequences to a participant are
currently as follows:
With respect to reinvested cash dividends used to purchase
shares in the open market, a participant will be treated for
Federal income tax purposes as having received on the Dividend
Payment Date a distribution in an amount equal to the cash
reinvested plus brokerage fees, commissions or other service
charges paid by the Company to obtain the shares. Such
distribution will be treated as dividend income to the
participant to the extent of the current and accumulated earnings
and profits of the Company, as determined for Federal income tax
purposes. The tax basis of the shares so purchased will be equal
to the amount of such distribution, including those charges paid
by the Company.
With respect to reinvested cash dividends used to purchase
authorized but unissued shares of Common Stock directly from the
Company, a participant will be treated for Federal income tax
purposes as having received on the Dividend Payment Date a
distribution in an amount equal to the fair market value on such
date of the full number of shares and any fractional share
purchased with reinvested dividends. The fair market value of
such shares on the Dividend Payment Date will be treated as
dividend income to the participant to the extent of the current
and accumulated earnings and profits of the Company, as
determined for Federal income tax purposes. The tax basis of the
shares so purchased will be equal to the fair market value of
such shares on the Dividend Payment Date.
A participant who purchases shares with optional cash
payments will recognize no taxable income upon such purchases
except to the extent of brokerage fees, commissions or other
service charges paid by the Company to obtain the shares. The
tax basis of shares purchased in this manner will be the amount
of the optional cash investment plus those charges paid by the
Company.
A participant does not realize any taxable income when such
participant receives certificates for whole shares of the Common
Stock credited to such participant's account under the Plan,
either upon request for certificates for certain of these shares,
or upon termination of such participant's participation or
termination of the Plan by the Company. However, gain or loss
will be realized by the participant when whole shares are sold,
either pursuant to the participant's request to sell shares held
in the Plan when such participant terminates participation in the
Plan or by such participant after such termination. In addition,
a participant who receives, upon termination of participation or
termination of the Plan by the Company, a cash adjustment for a
fraction of a share credited to such participant's account will
realize a gain or loss with respect to such fraction. The amount
of any such gain or loss would be the difference between the
amount which the participant receives for such participant's
shares or fraction of a share and the tax basis therefor.
For other tax consequences of participation in the Plan,
including state and local income taxation, participants should
consult their tax advisor.
The above Federal Income Tax discussion is based on Federal
income tax law as in effect as of the date hereof. Participants
should consult their tax advisors with respect to the impact of
any future legislative proposals or legislation enacted after the
date of this Prospectus.
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<PAGE>
TAX REPORTS
A quarterly statement of account will be furnished to each
participant which shows the price per share to be used in
determining the tax basis of the shares purchased with reinvested
dividends and/or optional cash investments. Such statement will
also show all transactions in the participant's account during
the year. The Form 1099-DIV mailed to each participant at year-
end will report the dividend income realized by the participant
during the year, including brokerage fees, commissions or other
service charges paid by the Company in respect of reinvested
dividends or optional cash investments. Such income may differ
from the total of the reinvested dividends. (See The Plan --
Share Purchases and Price). A Form 1099-B will be furnished to
the Participant for any shares sold through the Plan.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of
Common Stock, without par value, of which shares
were outstanding at the effective time of the Mergers, and serial
preference stock, par value $25 per share, none of which has been
issued. The following statements with respect to such capital
stock of the Company are a summary of certain rights and
privileges attaching to the stock under the laws of the State of
Texas and the Restated Articles of Incorporation and the Bylaws
of the Company, as amended. This summary does not purport to be
complete and is qualified in its entirety by reference to such
laws, the Restated Articles of Incorporation and the Bylaws of
the Company, as amended, for complete statements.
Each holder of shares of the Common Stock is entitled to one
vote for each share of Common Stock held on all questions
submitted to holders of shares and to cumulative voting at all
elections of directors. The Common Stock has no preemptive or
conversion rights. Upon issuance and sale of the shares offered
hereby, such shares will be fully paid and nonassessable.
The holders of the shares of the preference stock are not
accorded voting rights, except that, when dividends thereon are
in default in an amount equivalent to four full quarterly
dividends, the holders of shares of the preference stock are
entitled to vote for the election of one-third of the Board of
Directors or two directors, whichever is greater, and, when
dividends are in default in an amount equivalent to eight full
quarterly dividends, for the election of the smallest number of
directors necessary so that a majority of the full Board of
Directors shall have been elected by the holders of the shares of
the preference stock. The Company must also secure the approval
of the holders of two-thirds of the outstanding shares of the
preference stock prior to effecting various changes in its
capital structure.
After the payment of full preferential dividends on the
shares of any outstanding preference stock, holders of shares of
the Common Stock are entitled to dividends when and as declared
by the Board of Directors. After payment to the holders of
shares of any outstanding preference stock of the preferential
amounts to which they are entitled, the remaining assets to be
distributed, if any, upon any dissolution or liquidation shall be
distributed to the holders of shares of the Common Stock. Each
share of the Common Stock is equal to every other share of the
Common Stock with respect to dividends and also with respect to
distributions upon any dissolution or liquidation. (Reference is
made to Notes 4 and 5 to Consolidated Financial Statements of TEI
contained in the 1996 TEI 10-K.)
The Common Stock of the Company is listed on the New York,
Chicago and Pacific stock exchanges. Application will be made
for the listing on such exchanges of any additional shares
offered hereby.
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The transfer agent for the Common Stock is TU Services,
Dallas, Texas.
EXPERTS AND LEGALITY
The consolidated financial statements included in the 1996
TEI 10-K, incorporated herein by reference, have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their
report included in the 1996 TEI 10-K, and have been incorporated
by reference herein in reliance upon such report given upon the
authority of that firm as experts in accounting and auditing.
With respect to the unaudited condensed consolidated interim
financial information included in the TEI 10-Q that is
incorporated herein by reference, Deloitte & Touche LLP has
applied limited procedures in accordance with professional
standards for reviews of such information. As stated in their
report included in the TEI 10-Q, they did not audit and they did
not express an opinion on such interim financial information.
Deloitte & Touche LLP are not subject to the liability provisions
of Section 11 of the Securities Act of 1933, as amended (Act),
for their reports on such unaudited interim financial information
because such reports are not "reports" or a "part" of the
Registration Statement filed under the Act with respect to the
Common Stock offered hereby (Registration Statement), that were
prepared or certified by an accountant within the meaning of
Sections 7 and 11 of such Act.
The consolidated financial statements included in the 1996
ENSERCH 10-K, incorporated herein by reference, have been audited
by Deloitte & Touche LLP, independent auditors, as stated in
their report included in such 1996 ENSERCH 10-K, and have been
incorporated by reference herein in reliance upon such report
given upon the authority of that firm as experts in accounting
and auditing.
With respect to the unaudited condensed consolidated interim
financial information included in the ENSERCH 10-Q incorporated
herein by reference, Deloitte & Touche LLP has applied limited
procedures in accordance with professional standards for a review
of such information. As stated in their report included in the
ENSERCH 10-Q, they did not audit and they do not express an
opinion on such interim financial information. Deloitte &
Touche LLP is not subject to the liability provisions of Section
11 of the Act for their reports on such unaudited interim
financial information because such reports are not "reports" or a
"part" of the Registration Statement prepared or certified by an
accountant within the meaning of Sections 7 and 11 of the Act.
The statements made as to matters of law and legal
conclusions in this Prospectus under Description of Capital Stock
and in the 1996 TEI 10-K under Part I, Item 1 Business-
Regulation and Rates, and Environmental Matters, incorporated
herein by reference, have been reviewed by Worsham, Forsythe &
Wooldridge, L.L.P., Dallas, Texas, General Counsel for the
Company. All of such statements are set forth, or have been
incorporated by reference, herein in reliance upon the opinion of
that firm given upon their authority as experts. At May 31,
1997, members of the firm of Worsham, Forsythe & Wooldridge,
L.L.P., owned approximately shares of the Common Stock of
---------
the Company.
The statements of law and legal conclusions under the caption
Federal Income Tax have been reviewed by Reid & Priest LLP, New
York, New York, of counsel to the Company, and such statements
are made upon their authority as experts.
---------------
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NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER
CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, ANY SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES TO WHICH IT RELATES
OR ANY OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
19
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PART II. INFORMATION NOT REQUIRED IN PROSPECTUS.
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Filing fee -- Securities and Exchange
Commission . . . . . . . . . . . . . . . . . . $ 30,285
Fees of counsel:
Reid & Priest LLP . . . . . . . . . . . . . 15,000
Worsham, Forsythe & Wooldridge, L.L.P. . . 15,000
Auditors' fees . . . . . . . . . . . . . . . . . 15,000
Printing, including registration statement,
prospectus, exhibits, etc. . . . . . . . . . . 25,000
Miscellaneous expenses . . . . . . . . . . . . . 9,715
---------
Total expenses (estimated) . . . . . . . . . . $ 110,000
=========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article IX of the Restated Articles of Incorporation of the
Company provides as follows:
"The Corporation shall reimburse or indemnify any former,
present or future director, officer or employee of the
Corporation, or any person who may have served at its request as
a director, officer or employee of another corporation, or any
former, present or future director, officer or employee of the
Corporation who shall have served or shall be serving as an
administrator, agent or fiduciary for the Corporation or for
another corporation at the request of the Corporation (and his
heirs, executors and administrators) for or against all expenses
and liabilities incurred by him or them, or imposed on him or
them, including, but not limited to, judgments, settlements,
court costs and attorneys' fees, in connection with, or arising
out of, the defense of any action, suit or proceeding in which he
may be involved by reason of his being or having been such
director, officer or employee, except with respect to matters as
to which he shall be adjudged in such action, suit or proceeding
to be liable because he did not act in good faith, or because of
dishonesty or conflict of interest in the performance of his
duty.
"No former, present or future director, officer or employee
of the Corporation (or his heirs, executors and administrators)
shall be liable for any act, omission, step or conduct taken or
had in good faith, which is required, authorized or approved by
an order or orders issued pursuant to the Public Utility Holding
Company Act of 1935, the Federal Power Act, or any other federal
or state statute regulating the Corporation or its subsidiaries,
or any amendments to any thereof. In any action, suit or
proceeding based on any act, omission, step or conduct, as in
this paragraph described, the provisions hereof shall be brought
to the attention of the court. In the event that the foregoing
provisions of this paragraph are found by the court not to
constitute a valid defense, each such director, officer or
employee (and his heirs, executors and administrators) shall be
reimbursed for, or indemnified against, all expenses and
liabilities incurred by him or them, or imposed on him or them,
including, but not limited to, judgments, settlements, court
costs and attorneys' fees, in connection with, or arising out of,
any such action, suit or proceeding based on any act, omission,
step or conduct taken or had in good faith as in this paragraph
described.
"The foregoing rights shall not be exclusive of other
rights to which any such director, officer or employee (or his
heirs, executors and administrators) may otherwise be entitled
II-1
<PAGE>
under any bylaw, agreement, vote of shareholders or otherwise,
and shall be available whether or not the director, officer or
employee continues to be a director, officer or employee at the
time of incurring such expenses and liabilities. In furtherance,
and not in limitation of the foregoing provisions of this Article
IX, the Corporation may indemnify and may insure any such persons
to the fullest extent permitted by the Texas Business Corporation
Act, as amended from time to time, or the laws of the State of
Texas, as in effect from time to time."
Article 2.02-1 of the Texas Business Corporation Act
permits the Company, in certain circumstances, to indemnify any
present or former director, officer, employee or agent of the
Company against judgments, penalties, fines, settlements and
reasonable expenses incurred in connection with a proceeding in
which any such person was, is or is threatened to be, made a
party by reason of holding such office or position, but only to a
limited extent for obligations resulting from a proceeding in
which the person is found liable on the basis that a personal
benefit was improperly received or in circumstances in which the
person is found liable in a derivative suit brought on behalf of
the Company.
Article X of the Restated Articles of Incorporation of the
Company provides as follows:
"A director of the Corporation shall not be liable to the
Corporation or its shareholders for monetary damages for any act
or omission in the director's capacity as a director, except that
this provision does not eliminate or limit the liability of a
director to the extent the director is found liable for:
(a) a breach of the director's duty of loyalty to the
Corporation or its shareholders;
(b) an act or omission not in good faith that
constitutes a breach of duty of the director to the
Corporation or an act or omission that involves intentional
misconduct or a knowing violation of the law;
(c) a transaction from which the director received an
improper benefit, whether or not the benefit resulted from
an action taken within the scope of the director's office;
or
(d) an act or omission for which the liability of the
director is expressly provided for by an applicable
statute.
If the laws of the State of Texas are amended to authorize action
further eliminating or limiting the personal liability of
directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by
such laws as so amended. Any repeal or modification of this
Article X shall not adversely affect any right of protection of a
director of the Corporation existing at the time of such repeal
or modification."
Section 21 of the Company's bylaws provides as follows:
"Section 21. INSURANCE, INDEMNIFICATION AND OTHER
ARRANGEMENTS. Without further specific approval of the
shareholders of the Corporation, the Corporation may purchase,
enter into, maintain or provide insurance, indemnification or
other arrangements for the benefit of any person who is or was a
director, officer, employee or agent of the Corporation or is or
was serving another entity at the request of the Corporation as a
director, officer, employee, agent or otherwise, to the fullest
extent permitted by the laws of the State of Texas, including
without limitation Art. 2.02-1 of the Texas Business Corporation
Act or any successor provision, against any liability asserted
II-2
<PAGE>
against or incurred by any such person in any such capacity or
arising out of such person's service in such capacity whether or
not the Corporation would otherwise have the power to indemnify
against any such liability under the Texas Business Corporation
Act. If the laws of the State of Texas are amended to authorize
the purchase, entering into, maintaining or providing of
insurance, indemnification or other arrangements in the nature of
those permitted hereby to a greater extent than presently
permitted, then the Corporation shall have the power and
authority to purchase, enter into, maintain and provide any
additional arrangements in such regard as shall be permitted from
time to time by the laws of the State of Texas without further
approval of the shareholders of the Corporation. No repeal or
modification of such laws or this Section 21 shall adversely
affect any such arrangement or right to indemnification existing
at the time of such repeal or modification."
The Company has entered into agreements with its directors
which provide, among other things, for their indemnification
by the Company to the fullest extent permitted by Texas law,
unless a final adjudication establishes that the indemnitee's
acts were committed in bad faith, were the result of active
and deliberate dishonesty or that the indemnitee personally
gained a financial profit to which the indemnitee was not
legally entitled. These agreements further provide, under
certain circumstances, for the advancement of expenses and
the implementation of other arrangements for the benefit of
the indemnitee. The Company has insurance covering its
expenditures which might arise in connection with its lawful
indemnification of its directors and officers for their
liabilities and expenses. Officers and directors of the
Company also have insurance which insures them against
certain other liabilities and expenses.
ITEM 16. EXHIBITS.
PREVIOUSLY FILED*
-----------------
WITH FILE AS
EXHIBIT NUMBER EXHIBIT
------- -------- -------
4(a) 333-12391 2(a) - Restated Articles of
Incorporation of TUC Holding
Company.
4(b) 333-12391 2(b) - Bylaws, as amended, of TUC
Holding Company.
5(a) and 8 - Opinion of Reid & Priest LLP.
5(b) - Opinion of Worsham, Forsythe &
Wooldridge, L.L.P.
23(a) - TEI Independent Auditors'
Consent.
23(b) - ENSERCH Independent Auditors'
Consent
23(c) - Consents of Reid & Priest LLP
and Worsham, Forsythe &
Wooldridge, L.L.P. are
contained in Exhibits 5(a) and
8, and 5(b), respectively.
24 - Power of Attorney (see Page
II-5).
---------------
* Incorporated herein by reference.
II-3
<PAGE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such
information in the registration statement;
PROVIDED, HOWEVER, that the registrant need not file a post-
effective amendment to include the information required to be
included by subsection (i) or (ii) if such information is
contained in periodic reports filed by the registrant
pursuant to Sections 13 or 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(4) That, for purposes of determining any liability under
the Securities Act of 1933, each filing of the registrant's
Annual Report pursuant to Sections 13(a) or 15(d) of the
Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be
a new registration statement relating to the securities
offered herein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(b) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors,
officers or persons controlling the registrant pursuant to the
provisions described under Item 15 above, or otherwise, the
registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE>
EACH DIRECTOR AND/OR OFFICER OF THE REGISTRANT WHOSE
SIGNATURE APPEARS BELOW HEREBY APPOINTS THE AGENTS FOR SERVICE
NAMED IN THIS REGISTRATION STATEMENT, AND EACH OF THEM SEVERALLY,
AS HIS/HER ATTORNEY-IN-FACT TO SIGN IN HIS/HER NAME AND BEHALF,
IN ANY AND ALL CAPACITIES STATED BELOW, AND TO FILE WITH THE
SECURITIES AND EXCHANGE COMMISSION, ANY AND ALL AMENDMENTS,
INCLUDING POST-EFFECTIVE AMENDMENTS, TO THIS REGISTRATION
STATEMENT, AND THE REGISTRANT HEREBY ALSO APPOINTS EACH SUCH
AGENT FOR SERVICE AS ITS ATTORNEY-IN-FACT WITH LIKE AUTHORITY TO
SIGN AND FILE ANY SUCH AMENDMENTS IN ITS NAME AND BEHALF.
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933,
THE REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO
BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM
S-3 AND HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN
THE CITY OF DALLAS, AND STATE OF TEXAS, ON THE 29TH DAY OF MAY,
1997.
TUC HOLDING COMPANY
By /s/ ERLE NYE
-------------------------------
(Erle Nye, Chairman of the Board
and Chief Executive)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES AND ON THE DATE INDICATED.
SIGNATURE TITLE DATE
--------- ----- ----
/S/ ERLE NYE PRINCIPAL EXECUTIVE
------------------------------ OFFICER AND DIRECTOR MAY 29, 1997
(ERLE NYE, CHAIRMAN AND
CHIEF EXECUTIVE)
/S/ PETER B. TINKHAM PRINCIPAL FINANCIAL MAY 29, 1997
------------------------------ OFFICER
(PETER B. TINKHAM, TREASURER
AND ASSISTANT SECRETARY)
/S/ MARC D. MOSELEY
------------------------------ PRINCIPAL ACCOUNTING MAY 29, 1997
(MARC D. MOSELEY, ACTING OFFICER
CONTROLLER)
/S/ ROBERT A. WOOLDRIDGE
------------------------------- DIRECTOR MAY 29, 1997
(ROBERT A. WOOLDRIDGE)
II-5
<PAGE>
INDEX TO EXHIBITS
PREVIOUSLY FILED*
------------------
WITH
FILE AS
EXHIBIT NUMBER EXHIBIT
------- ------ -------
4(a) 333-12391 2(a) - Restated Articles of Incorporation
of TUC Holding Company.
4(b) 333-12391 2(b) - Bylaws, as amended, of TUC Holding
Company.
5(a)and 8 - Opinion of Reid & Priest LLP.
5(b) - Opinion of Worsham, Forsythe &
Wooldridge, L.L.P.
23(a) - TEI Independent Auditors' Consent.
23(b) - ENSERCH Independent Auditors'
Consent.
23(c) - Consents of Reid & Priest and
Worsham, Forsythe & Wooldridge,
L.L.P. are contained in Exhibits
5(a) and 8, 5(b), respectively.
24 - Power of Attorney (see Page II-5).
---------------------
*Incorporated herein by reference.
II-6
Exhibit 5(a) and 8
REID & PRIEST LLP
40 West 57th Street
New York, New York 10019-4097
May 29, 1997
TUC Holding Company
Energy Plaza
1601 Bryan Street
Dallas, Texas 75201
Ladies and Gentlemen:
Referring to the proposed offer and sale by TUC Holding
Company (Company) of not to exceed 3,000,000 shares of its common
stock without par value (Stock) pursuant to the Company's Direct
Stock Purchase and Dividend Reinvestment Plan (Plan) as
contemplated in the Registration Statement to be filed with the
Securities and Exchange Commission (Commission) under the
Securities Act of 1933, as amended, on or about the date hereof
(Registration Statement), subject to the consummation of the
mergers of Texas Utilities Company, to be renamed Texas Energy
Industries, Inc., and ENSERCH Corporation, the predecessors of
the Company, with and into subsidiaries of the Company, we are of
the opinion that:
1. The Company is a corporation validly organized and
existing under the laws of the State of Texas.
2. All necessary action on the part of the Company's
Board of Directors with respect to the issuance and sale of Stock
to be purchased directly from the Company has been taken.
3. Any Stock to be purchased directly from the
Company will be validly issued, fully paid and non-assessable
when such Stock shall have been issued and sold for the
consideration contemplated in the Plan.
4. Any Stock to be purchased on the open market will
be validly issued, fully paid and non-assessable; and
5. The statements made in the Registration Statement,
under the heading "Federal Income Tax Matters Federal Income
Tax Consequences", constitute an accurate general description of
the material Federal income tax consequences to participants in
the Plan.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of the State of Texas. As
to all matters of Texas law, we have with your consent relied
upon an opinion of even date herewith addressed to you by
Worsham, Forsythe & Wooldridge, L.L.P. of Dallas, Texas.
We hereby consent to the use of our name in the
Registration Statement, and to the filing of this opinion with
the Commission as an exhibit to the Registration Statement.
Very truly yours,
/s/ Reid & Priest LLP
REID & PRIEST LLP
Exhibit 5(b)
WORSHAM, FORSYTHE & WOOLDRIDGE, L.L.P.
ATTORNEYS AND COUNSELORS AT LAW
1601 BRYAN STREET, 30TH FLOOR
DALLAS, TEXAS 75201
TELEPHONE (214) 979-3000
FAX (214) 880-0011
May 29, 1997
TUC Holding Company
Energy Plaza
1601 Bryan Street
Dallas, Texas 75201
Ladies and Gentlemen:
Referring to the Registration Statement on Form S-3 to
be filed by TUC Holding Company ("Company") on or about the date
hereof with the Securities and Exchange Commission ("Commission")
under the Securities Act of 1933, as amended, for the
registration of 3,000,000 shares of common stock, without par
value ("Stock"), to be offered from time to time by the Company
in connection with its Direct Stock Purchase and Dividend
Reinvestment Plan ("Plan"), subject to the consummation of the
mergers of Texas Utilities Company, to be renamed Texas Energy
Industries, Inc., and ENSERCH Corporation, the predecessors of
the Company, with and into subsidiaries of the Company, we are of
the opinion that:
1. The Company is a corporation validly organized and
existing under the laws of the State of Texas.
2. All necessary action on the part of the Company's
Board of Directors with respect to the issuance and sale of Stock
to be purchased directly from the Company has been taken.
3. Any Stock to be purchased directly from the
Company will be validly issued, fully paid and non-assessable
when such Stock shall have been issued and sold for the
consideration contemplated in the Plan.
4. Any Stock to be purchased on the open market will
be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion with
the Commission as an exhibit to the aforementioned Registration
Statement and to the use of our name as counsel in said
Registration Statement and as authority for certain of the
information contained or incorporated by reference therein.
Very truly yours,
WORSHAM, FORSYTHE
& WOOLDRIDGE, L.L.P.
By: /s/ T. A. Mack
----------------------------
A Partner
EXHIBIT 23(a)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of TUC Holding Company (to be known as Texas Utilities
Company) on Form S-3 of our report dated March 12, 1997, on Texas
Utilities Company (to be known as Texas Energy Industries, Inc.
["the Company"]) which report includes an explanatory paragraph
concerning the Company's change during 1995 in its method of
accounting for the impairment of long lived assets and long lived
assets to be disposed of to conform with Statement of Financial
Accounting Standards No. 121, appearing in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 and to
the reference to us under the heading "Experts and Legality" in
the Prospectus which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
Dallas, Texas
May 29, 1997
EXHIBIT 23(b)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of TUC Holding Company (to be known as Texas Utilities
Company) on Form S-3 of our report dated February 10, 1997, on
ENSERCH Corporation and subsidiaries (ENSERCH) appearing in
ENSERCH's Annual Report on Form 10-K for the year ended December
31, 1996, and to the reference to us under the heading "Experts
and Legality" in the Prospectus, which is part of this
Registration Statement.
/s/ Deloitte & Touche LLP
Dallas, Texas
May 29, 1997
