<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM 11-K
[ x ] ANNUAL REPORT PURSUANT TO SECTION 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
EMPLOYEES' THRIFT PLAN OF THE
TEXAS UTILITIES COMPANY SYSTEM
Commission File No. 1-12833
-------------------------------
TEXAS UTILITIES COMPANY
(Doing Business as TXU Corp)
Energy Plaza, 1601 Bryan Street, Dallas, Texas 75201
(Name of issuer of the securities held pursuant to the Plan
and the address of its principal executive office)
<PAGE>
TABLE OF CONTENTS
Page
FINANCIAL STATEMENTS
The following statements are furnished for the Plan:
Statement of Net Assets Available for Benefits,
December 31, 1998 . . . . . . . . . . . . . . . . . . . . . . 3
Statement of Net Assets Available for Benefits,
December 31, 1997 . . . . . . . . . . . . . . . . . . . . . . 4
Statement of Changes in Net Assets Available for Benefits,
for the Year Ended December 31, 1998. . . . . . . . . . . . . 5
Statement of Changes in Net Assets Available for Benefits,
for the Year Ended December 31, 1997. . . . . . . . . . . . . 6
Notes to Financial Statements . . . . . . . . . . . . . . . . . 7
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes,
December 31, 1998 . . . . . . . . . . . . . . . . . . . . . 14
Schedule of Reportable Transactions for the Year
Ended December 31, 1998 . . . . . . . . . . . . . . . . . . 17
INDEPENDENT AUDITORS' REPORT . . . . . . . . . . . . . . . . . . . . 18
SIGNATURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
EXHIBITS
The following exhibit is filed herewith:
Independent Auditors' Consent . . . . . . . . . . . . . . . . . 20
2
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- ------------------------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998
- ----------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION
----------------------------------------------------------------
Bond Interest Equity Equity
Common Index Income Income Index
Total Stock Fund Fund Fund Fund
------- ------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments - at fair value (Notes 2, 4, and 5):
Common Stock of TXU. . . . . . . . . . . . . . . $576,009,459 $576,009,459 $ - $ - $ - $ -
Mutual funds . . . . . . . . . . . . . . . . . . 286,808,544 - 12,683,693 - 84,526,781 62,577,568
Guaranteed contracts . . . . . . . . . . . . . . 45,480,690 - - 45,480,690 - -
Money market funds . . . . . . . . . . . . . . . 4,913,527 603,420 - 4,310,107 - -
FNMA/FHLMC*. . . . . . . . . . . . . . . . . . . 9,136,555 - - 9,136,555 - -
Corporate Debt . . . . . . . . . . . . . . . . . 2,506,055 - - 2,506,055 - -
Participant loans receivable . . . . . . . . . . 21,722,716 - - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total investments. . . . . . . . . . . . . . . 946,577,546 576,612,879 12,683,693 61,433,407 84,526,781 62,577,568
Cash . . . . . . . . . . . . . . . . . . . . . . . 77,807 - - - - 44,593
Contributions receivable from Employer-corporations 4,097,451 1,429,914 100,199 300,408 498,911 587,825
Dividends receivable . . . . . . . . . . . . . . . 10,451,210 10,451,210 - - - -
Interest receivable. . . . . . . . . . . . . . . . 2,154 2,154 - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total assets . . . . . . . . . . . . . . . . 961,206,168 588,496,157 12,783,892 61,733,815 85,025,692 63,209,986
LIABILITIES
Note payable (Note 3). . . . . . . . . . . . . . . 249,806,000 249,806,000 - - - -
Accrued interest payable . . . . . . . . . . . . . 5,105,231 5,105,231 - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total liabilities. . . . . . . . . . . . . . 254,911,231 254,911,231 - - - -
============ ============ =========== =========== =========== ===========
NET ASSETS AVAILABLE FOR BENEFITS. . . . . . . . . $706,294,937 $333,584,926 $12,783,892 $61,733,815 $85,025,692 $63,209,986
============ ============ =========== =========== =========== ===========
Equity Small Equity
International Company Balanced Growth Loan
Fund Fund Fund Fund Fund
------ ------ ------ ------ ------
ASSETS
Investments - at fair value (Notes 2, 4 and 5):
Common Stock of TXU. . . . . . . . . . . . . . $ - $ - $ - $ - $ -
Mutual funds . . . . . . . . . . . . . . . . . 652,772 825,407 28,257,227 97,285,096 -
Guaranteed contracts . . . . . . . . . . . . . - - - - -
Money market funds . . . . . . . . . . . . . . - - - - -
FNMA/FHLMC*. . . . . . . . . . . . . . . . . . - - - - -
Corporate Debt . . . . . . . . . . . . . . . . - - - - -
Participant loans receivable . . . . . . . . . - - - - 21,722,716
-------- -------- ----------- ----------- -----------
Total investments. . . . . . . . . . . . . 652,772 825,407 28,257,227 97,285,096 21,722,716
Cash . . . . . . . . . . . . . . . . . . . . . . 6,227 20,604 - 6,383 -
Contributions receivable from Employer-corporations 10,998 15,583 330,208 823,405 -
Dividends receivable . . . . . . . . . . . . . . - - - - -
Interest receivable. . . . . . . . . . . . . . . - - - - -
-------- -------- ----------- ----------- -----------
Total assets . . . . . . . . . . . . . . . 669,997 861,594 28,587,435 98,114,884 21,722,716
LIABILITIES
Note payable (Note 3). . . . . . . . . . . . . . - - - - -
Accrued interest payable . . . . . . . . . . . . - - - - -
-------- -------- ----------- ----------- -----------
Total liabilities. . . . . . . . . . . . . - - - - -
======== ======== =========== =========== ===========
NET ASSETS AVAILABLE FOR BENEFITS. . . . . . . . $669,997 $861,594 $28,587,435 $98,114,884 $21,722,716
======== ======== =========== =========== ===========
<FN>
*Federal National Mortgage Association/Federal Home Loan Mortgage Corporation
See accompanying Notes to Financial Statements.
</FN>
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- ------------------------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION
----------------------------------------------------------------
Bond Interest Equity Equity
Common Index Income Income Index
Total Stock Fund Fund Fund Fund
------- ------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments - at fair value (Notes 2, 4 and 5):
Common Stock of TXU. . . . . . . . . . . . . . . . $508,774,106 $508,774,106 $ - $ - $ - $ -
Mutual funds . . . . . . . . . . . . . . . . . . . 214,930,691 - 10,205,807 - 70,570,157 38,686,897
Guaranteed contracts . . . . . . . . . . . . . . . 36,484,761 - - 36,484,761 - -
Money market funds . . . . . . . . . . . . . . . . 6,126,309 299,924 - 5,826,385 - -
FNMA/FHLMC*. . . . . . . . . . . . . . . . . . . . 15,834,754 - - 15,834,754 - -
Participant loans receivable . . . . . . . . . . . 17,502,332 - - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total investments . . . . . . . . . . . . . . 799,652,953 509,074,030 10,205,807 58,145,900 70,570,157 38,686,897
Cash. . . . . . . . . . . . . . . . . . . . . . . . 84,908 60,772 - - - -
Contributions receivable from Employer-corporations 3,926,110 1,748,452 73,486 279,839 505,243 410,385
Dividends receivable. . . . . . . . . . . . . . . . 9,984,700 9,984,700 - - - -
Interest receivable . . . . . . . . . . . . . . . . 134,099 10,518 - 123,581 - -
------------ ------------ ----------- ----------- ----------- -----------
Total assets. . . . . . . . . . . . . . . . 813,782,770 520,878,472 10,279,293 58,549,320 71,075,400 39,097,282
LIABILITIES
Note payable (Note 3). . . . . . . . . . . . . . . 250,000,000 250,000,000 - - - -
Accrued interest payable . . . . . . . . . . . . . 5,654,375 5,654,375 - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total liabilities . . . . . . . . . . . . . 255,654,375 255,654,375 - - - -
============ ============ =========== =========== =========== ===========
NET ASSETS AVAILABLE FOR BENEFITS . . . . . . . . . $558,128,395 $265,224,097 $10,279,293 $58,549,320 $71,075,400 $39,097,282
============ ============ =========== =========== =========== ===========
Equity
Balanced Growth Loan
Fund Fund Fund
------ ------ ------
ASSETS
Investments - at fair value (Notes 2, 4 and 5):
Common Stock of TXU . . . . . . . . . . . . . . . $ - $ - $ -
Mutual funds. . . . . . . . . . . . . . . . . . . 24,347,711 71,120,119 -
Guaranteed contracts. . . . . . . . . . . . . . . - - -
Money market funds. . . . . . . . . . . . . . . . - - -
FNMA/FHLMC* . . . . . . . . . . . . . . . . . . . - - -
Participant loans receivable. . . . . . . . . . . - - 17,502,332
------------ ------------ -----------
Total investments. . . . . . . . . . . . . . 24,347,711 71,120,119 17,502,332
Cash . . . . . . . . . . . . . . . . . . . . . . . - 24,136 -
Contributions receivable from Employer-corporations 196,997 711,708 -
Dividends receivable . . . . . . . . . . . . . . . - - -
Interest receivable. . . . . . . . . . . . . . . . - - -
------------ ------------ -----------
Total assets . . . . . . . . . . . . . . . . 24,544,708 71,855,963 17,502,332
LIABILITIES
Note payable (Note 3) . . . . . . . . . . . . . . - - -
Accrued interest payable. . . . . . . . . . . . . - - -
------------ ------------ -----------
Total liabilities. . . . . . . . . . . . . . - - -
============ ============ ===========
NET ASSETS AVAILABLE FOR BENEFITS. . . . . . . . . $24,544,708 $71,855,963 $17,502,332
============ ============ ===========
<FN>
*Federal National Mortgage Association/Federal Home Loan Mortgage Corporation
See accompanying Notes to Financial Statements.
</FN>
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- ------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998
- ---------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION
----------------------------------------------------------------
Bond Interest Equity Equity
Common Index Income Income Index
Total Stock Fund Fund Fund Fund
------- ------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR. . . . . . . . . . . . $558,128,395 $265,224,097 $10,279,293 $58,549,320 $71,075,400 $39,097,282
------------ ------------ ----------- ----------- ----------- -----------
ADDITIONS
Income:
Dividends. . . . . . . . . . . . . . 42,366,743 27,428,145 737,109 - 4,684,972 1,561,608
Interest:
Investments . . . . . . . . . . . 3,789,214 53,763 - 3,735,451 - -
Loans . . . . . . . . . . . . . . 1,948,012 - - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total income. . . . . . . . . . . . 48,103,969 27,481,908 737,109 3,735,451 4,684,972 1,561,608
------------ ------------ ----------- ----------- ----------- -----------
Contributions:
Participating employees' savings . . . . 40,458,703 8,843,768 1,239,180 3,936,251 7,433,411 6,449,345
Employer-corporations. . . . . . . . . . 16,539,122 16,539,122 - - - -
------------ ------------ ----------- ----------- ----------- -----------
Total contributions . . . . . . . . 56,997,825 25,382,890 1,239,180 3,936,251 7,433,411 6,449,345
------------ ------------ ----------- ----------- ----------- -----------
Net appreciation (depreciation)
on fair value of investments . . . . . . 93,830,331 63,402,632 195,341 29,794 4,422,649 11,196,051
------------ ------------ ----------- ----------- ----------- -----------
Total additions . . . . . . . . . . 198,932,125 116,267,430 2,171,630 7,701,496 16,541,032 19,207,004
------------ ------------ ----------- ----------- ----------- -----------
DEDUCTIONS
Distributions to withdrawing participants 26,306,110 12,737,433 620,134 3,159,349 3,422,161 1,775,249
Interest expense and other fees(Note 2) 24,459,473 24,311,710 - 147,763 - -
------------ ------------ ----------- ----------- ----------- -----------
Total deductions. . . . . . . . . . 50,765,583 37,049,143 620,134 3,307,112 3,422,161 1,775,249
------------ ------------ ----------- ----------- ----------- -----------
TRANSFERS BETWEEN FUNDS - Net. . . . . . . - (10,857,458) 953,103 (1,209,889) 831,421 6,680,949
------------ ------------ ----------- ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR. . . . . . . . . . . . . . . $706,294,937 $333,584,926 $12,783,892 $61,733,815 $85,025,692 $63,209,986
============ ============ =========== =========== =========== ===========
Equity
Equity Small Equity
International Company Balanced Growth Loan
Fund Fund Fund Fund Fund
------ ------ ------ ------ ------
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR. . . . . . . . . . . . $ - $ - $24,544,708 $71,855,963 $17,502,332
------------ ------------ ----------- ----------- -----------
ADDITIONS
Income:
Dividends. . . . . . . . . . . . . . 28,015 815 2,307,129 5,618,950 -
Interest:
Investments . . . . . . . . . . . - - - - -
Loans . . . . . . . . . . . . . . - - - - 1,948,012
------------ ------------ ----------- ----------- -----------
Total income. . . . . . . . . . . . 28,015 815 2,307,129 5,618,950 1,948,012
------------ ------------ ----------- ----------- -----------
Contributions:
Participating employees' savings . . . . 38,150 49,809 3,153,022 9,315,767 -
Employer-corporations. . . . . . . . . . - - - - -
------------ ------------ ----------- ----------- -----------
Total contributions . . . . . . . . 38,150 49,809 3,153,022 9,315,767 -
------------ ------------ ----------- ----------- -----------
Net appreciation (depreciation)
on fair value of investments . . . . . . 20,907 99,494 (992,647) 15,456,110 -
------------ ------------ ----------- ----------- -----------
Total additions . . . . . . . . . . 87,072 150,118 4,467,504 30,390,827 1,948,012
------------ ------------ ----------- ----------- -----------
DEDUCTIONS
Distributions to withdrawing participants 135 244 1,008,902 3,120,966 461,537
Interest expense and other fees(Note 2) - - - - -
------------ ------------ ----------- ----------- -----------
Total deductions. . . . . . . . . . 135 244 1,008,902 3,120,966 461,537
------------ ------------ ----------- ----------- -----------
TRANSFERS BETWEEN FUNDS - Net. . . . . . . 583,060 711,720 584,125 (1,010,940) 2,733,909
------------ ------------ ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR. . . . . . . . . . . . . . . $ 669,997 $ 861,594 $28,587,435 $98,114,884 $21,722,716
============ ============ =========== =========== ===========
<FN>
See accompanying Notes to Financial Statements.
</FN>
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- ------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997
- --------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION
---------------------------------------------------
Bond Interest Equity
Common Index Income Income
Total Stock Fund Fund Fund
------- ------- ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR. . . . . . . . . . . . $493,705,200 $257,657,007 $10,085,349 $61,842,149 $52,431,735
------------ ------------ ----------- ----------- -----------
ADDITIONS
Income:
Dividends. . . . . . . . . . . . . . 39,426,906 26,350,581 656,758 - 3,867,952
Interest:
Investments . . . . . . . . . . . 4,168,508 66,881 - 4,101,627 -
Loans . . . . . . . . . . . . . . 1,568,490 - - - -
------------ ------------ ----------- ----------- -----------
Total income. . . . . . . . . . . . 45,163,904 26,417,462 656,758 4,101,627 3,867,952
------------ ------------ ----------- ----------- -----------
Contributions:
Participating employees' savings . . . . 38,187,697 9,522,936 1,210,220 4,528,877 6,355,596
Employer-corporations. . . . . . . . . . 18,260,226 18,260,226 - - -
------------ ------------ ----------- ----------- -----------
Total contributions . . . . . . . . 56,447,923 27,783,162 1,210,220 4,528,877 6,355,596
------------ ------------ ----------- ----------- -----------
Net appreciation (depreciation)
on fair value of investments . . . . . . 38,654,411 12,693,821 182,568 - 10,798,617
------------ ------------ ----------- ----------- -----------
Total additions . . . . . . . . . . 140,266,238 66,894,445 2,049,546 8,630,504 21,022,165
------------ ------------ ----------- ----------- -----------
DEDUCTIONS
Distributions to withdrawing participants 50,855,600 27,089,002 1,167,567 10,197,767 4,695,829
Interest expense and other fee (Note 2). 24,987,443 24,866,687 - 120,756 -
------------ ------------ ----------- ----------- -----------
Total deductions. . . . . . . . . . 75,843,043 51,955,689 1,167,567 10,318,523 4,695,829
------------ ------------ ----------- ----------- -----------
TRANSFERS BETWEEN FUNDS - Net. . . . . . . - (7,371,666) (688,035) (1,604,810) 2,317,329
------------ ------------ ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR. . . . . . . . . . . . . . . $558,128,395 $265,224,097 $10,279,293 $58,549,320 $71,075,400
============ ============ =========== =========== ===========
Equity Equity
Index Balanced Growth Loan
Fund Fund Fund Fund
------ ------ ------ ------
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR. . . . . . . . . . . . $24,047,251 $20,525,226 $53,007,854 $14,108,629
----------- ----------- ----------- -----------
ADDITIONS
Income:
Dividends. . . . . . . . . . . . . . 819,966 2,424,209 5,307,440 -
Interest:
Investments . . . . . . . . . . . - - - -
Loans . . . . . . . . . . . . . . - - - 1,568,490
----------- ----------- ----------- -----------
Total income. . . . . . . . . . . . 819,966 2,424,209 5,307,440 1,568,490
----------- ------------ ----------- -----------
Contributions:
Participating employees' savings . . . . 4,668,878 3,034,755 8,866,435 -
Employer-corporations. . . . . . . . . . - - - -
----------- ----------- ----------- -----------
Total contributions . . . . . . . . 4,668,878 3,034,755 8,866,435 -
----------- ----------- ----------- -----------
Net appreciation (depreciation)
on fair value of investments . . . . . . 6,996,969 767,778 7,214,658 -
----------- ----------- ----------- -----------
Total additions . . . . . . . . . . 12,485,813 6,226,742 21,388,533 1,568,490
----------- ----------- ----------- -----------
DEDUCTIONS
Distributions to withdrawing participants 1,756,603 1,955,133 3,391,371 602,328
Interest expense and other fees(Note 2) - - - -
----------- ----------- ----------- -----------
Total deductions. . . . . . . . . . 1,756,603 1,955,133 3,391,371 602,328
----------- ----------- ----------- -----------
TRANSFERS BETWEEN FUNDS - Net. . . . . . . 4,320,821 (252,127) 850,947 2,427,541
----------- ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR. . . . . . . . . . . . . . . $39,097,282 $24,544,708 $71,855,963 $17,502,332
=========== =========== =========== ===========
<FN>
* Reduced for forfeitures of $39,981.
See accompanying Notes to Financial Statements.
</FN>
</TABLE>
6
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following description is provided for general information purposes
only. Reference should be made to the Plan document for more complete
information.
General -- The Employees' Thrift Plan of the Texas Utilities Company
System (Plan) is a defined contribution plan established in 1968 by Texas
Utilities Company and its subsidiaries, doing business as TXU Corp
(Employer-corporations). The Employees' Thrift Plan Committee manages the
operation and administration of the Plan. Mellon Bank, N.A. serves as trustee
(Trustee) and is custodian of the assets of the Plan. Dreyfus Retirement
Services, a subsidiary of the trustee, serves as record-keeper for the Plan. In
1990, the Plan was amended to establish a leveraged employee stock ownership
provision (See Note 3). The Plan was again amended effective January 1,
1993. Such amendments to the Plan, among other things, established a pre-tax
deferral feature in accordance with Section 401(k) of the Internal Revenue Code
of 1986, as amended (Code). The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974, as amended (ERISA).
The plan is intended to be a participant directed "individual account
plan" under ERISA Section 404(c). As such, the fiduciaries of the Plan are
not liable for any losses that are the direct and necessary result of
participant investment decisions. Participation in the Plan by employees of
the Employer-corporations who meet certain eligibility requirements is
entirely voluntary.
The Plan includes nine investment options, or funds:
- Common Stock of TXU (Common Stock) -- invests exclusively in Common
Stock of Texas Utilities Company (Company);
- Bond Index Fund -- purchases units in the Vanguard Bond Index
Total Institutional Fund;
- Interest Income Fund -- invests in fixed-rate contracts with
insurance companies and other financial institutions;
- Equity Income Fund -- purchases units in the Fidelity
Equity-Income Fund, which consists primarily of income-producing equity
securities;
- Equity Index Fund -- purchases units in the Vanguard Institutional
Index Fund, which consists primarily of common stocks included in the
Standard & Poor's 500 Index;
- Equity International Fund -- purchases units in the American
AAdvantage International Institutional Fund, which invests primarily in
equity securities of foreign issuers;
- Equity Small Company Fund -- purchases units in the SSgA Small
Capitalization Fund, which invests primarily in equity securities issued
by companies with market capitalization of less than $1.5 billion;
- Balanced Fund -- purchases units in the Hotchkis and Wiley
Balanced Income Fund, which consists primarily of investments in equity
securities, fixed income securities and money market obligations;
- Equity Growth Fund -- purchases units in the American Express
IDS New Dimensions Fund (Class Y), which invests primarily in common
stocks of companies showing potential for significant growth, and also
invests in foreign securities and futures transactions.
Eligibility, Participation and Employee Savings -- Effective January 1,
1998, any regular employee of an Employer-corporation, who was not on the
ENSERCH Corporation payroll on December 31, 1997, is eligible to participate in
the Plan upon employment.
7
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
Under the Plan, except as limited by law, a participating employee may
invest, through pre-tax salary deferrals (Elective Deferrals) or after tax
payroll deductions (Payroll Deductions) each payroll period, a specified
amount ranging from 1% to 6% of regular salary or wages (Basic Employee
Savings). Participants electing the maximum Basic Employee Savings investment
may also invest, through Elective Deferrals or Payroll Deductions each payroll
period, an additional 1% to 10% of regular salary or wages (Supplemental
Employee Savings).
Employer Matching Contributions -- Matching contributions to
participant accounts by the Employer-corporations are made based on the
participants' Basic Employee Savings and years of service as follows:
Less than 10 years 40%
10 years but less than 25 years 50%
25 years or more 60%
No employer contributions are made with respect to Supplemental Employee
Savings.
Investment of Funds -- All employer matching contributions are invested
in Common Stock of the Company, however, effective April 1, 1998 each
participant may invest, in 1% increments, in the various nine investment
options with respect to the investment of Basic and Supplemental Employee
Savings. All assets of the Plan are held by the Trustee for the exclusive
benefit of participants and their beneficiaries. Separate account records for
each participant are maintained by the Trustee. The Trustee provides a summary
of financial performance by investment fund directly to Plan participants.
Effective April 1, 1998 a participant may change selected investment
options for Employee Savings at any time by liquidating the investments
attributable to Basic and Supplemental Employee Savings and reinvesting such
amounts in other investment options as may be permitted under the Plan.
A participant who has completed at least ten years of Plan participation
and attained age 55 may annually instruct the Trustee to diversify up to 25%
of such participant's employer contributions account (reduced by amounts
previously so diversified) in the same proportion as the participant may
diversify such Basic and Supplemental Employee Savings. At age 60 and
thereafter, a participant may annually diversify up to 50% of such employer
contributions account (reduced by amounts previously so diversified).
Unit Values -- Participants do not have beneficial ownership in
specific securities or other assets in the various funds other than Common
Stock, but have an interest therein represented by units valued as of the
close of each business day. Generally, contributions to and withdrawal
payments from each fund are converted to units by dividing the amounts of such
transactions by the unit value as last determined, and the appropriate account
is charged or credited with the number of units properly attributable to the
participant.
Voting of Common Stock -- Each participant may give the Trustee
confidential written instructions with respect to the voting, at any meeting
of shareholders, of the Common Stock allocated to the participant's account.
Effective January 1, 1993, the unallocated Common Stock held pursuant to the
leveraged employee stock ownership component of the Plan may be voted by the
Trustee in its discretion unless otherwise directed pursuant to a voting
procedure agreement.
8
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
Withdrawal from the Plan -- Withdrawals from the Plan are governed by
applicable Internal Revenue Service (IRS) regulations and provisions of ERISA.
Penalties may apply in certain instances.
A participant who terminates employment and has an account balance
greater than $5,000 may retain the funds in the Plan or withdraw them at any
time. Participants that terminate with balances equal to or less than $5,000
are required to receive a distribution after termination. To avoid taxation,
the taxable portion of any withdrawal made upon termination may be rolled into
an IRA or a qualified retirement plan sponsored by another employer.
The IRS has established rules governing distributions from the Plan after
the participant has attained 70 1/2 years of age.
A participant may withdraw a portion of after-tax Basic and Supplemental
Employee Savings without necessitating a total withdrawal from the Plan and
may exercise the limited privilege of an after-tax partial withdrawal at any
time. Partial withdrawals may be in any amount up to 90% of the participant's
Basic and Supplemental Employee Savings, or 90% of market value, whichever is
less.
In the event of an after-tax partial withdrawal, such amount will be paid
to the participant in cash or in shares of Common Stock to the extent such
stock is held in the participant's account for after-tax Basic and
Supplemental Employee Savings, at the option of the participant. No partial
withdrawal may be made of Elective Deferrals, Rollover Contributions, Employer
matching contributions, or income from such deferrals or contributions. A
participant may repay to the Trustee the amounts of any after-tax partial
withdrawal made after January 1, 1976, at any time. An after-tax Partial
withdrawal by a participant does not terminate participation in the Plan.
A participant may complete a total withdrawal from the aftertax account,
including a withdrawal of related Company matching contributions, at any
time. Distributions from the pretax and rollover accounts to active employees
under age 59 1/2 are permitted under the Internal Revenue Code Hardship
Withdrawal provisions. Participants who complete Hardship Withdrawals may not
contribute to the plan for a period of 12 months. Upon termination of
employment or attainment of age 59 1/2, a participant may complete a total
withdrawal from the plan, to include the values in the aftertax contribution
and company match account, pretax contribution and related match account and
rollover account.
Effective January 1, 1998, participants are fully vested in all amounts
in their accounts (i.e., Elective Deferrals, Payroll Deductions, Employer
Matching Contributions, Rollover Contributions and all earnings and dividends
thereon).
Participants making withdrawals may choose from the following optional
forms of payment: (a) shares of Common Stock and/or publicly traded Fund
units (to the extent permitted by the Fund) credited to a participant's
account; (b) single lump sum cash payment; or (c) a combination
of (a) and (b).
9
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
In the event of a total withdrawal made after January 1, 1976, by a
participant who was not 100% vested prior to January 1, 1998, the participant
may repay to the Plan the amount of such distribution at any time prior to the
close of the Plan Year in which the participant has completed five consecutive
Break-in-Service years and any amounts previously forfeited will be restored
to the participant's account.
In addition, participants may, after meeting certain qualifications as
defined by the IRS, withdraw a portion of their 401(k) account balance based
on a hardship qualification.
Federal Income Taxes - The Company has been advised by the IRS that the
Plan meets the requirements of Section 401(a) of the Code, as to form; that
the Trust established thereunder is exempt from federal income taxes under
Section 501(a) of the Code; and that employer contributions paid to the Trust
under the Plan are allowable federal income tax deductions to the
Employer-corporations subject to the conditions and limitations of Section 404
of the Code.
Based on the Code and regulations issued pursuant thereto:
(a)Employer contributions under the Plan, and dividends, interest and
other income from Trust Assets are not taxable to the participant when
received by the Trustee and credited to the participant's account.
(b)Basic and Supplemental Employee Savings made by Payroll Deduction are
not deductible on the participant's federal income tax return.
(c)Basic and Supplemental Employee Savings which are Employee Elective
Deferrals reduce a participant's gross compensation as reported on
Form W-2 and are not taxable to the participant when received by the
Trustee and credited to the participant's account.
(d)Partial withdrawal of employee savings which were contributed to the
Plan through Payroll Deductions prior to January 1, 1987, represent a
return of employee savings and are not taxable to the participant when
withdrawn. Partial withdrawals of employee savings which were
contributed to the Plan through Payroll Deductions after December 31,
1986, are considered to include, for income tax purposes, an amount of
taxable income.
(e)A total withdrawal generally results in taxable income to the
participant equal to the gross distribution less Basic and Supplemental
Employee Savings made by Payroll Deduction. However, if the total
withdrawal meets the lump sum distribution requirements of the Code,
(i) any net unrealized appreciation in the value of distributable
Common Stock from the time of distribution will be tax deferred; (ii)
any additional appreciation in the value of Common Stock from the time
of distribution to the time of stock sale or disposition will be
treated as short-term or long-term capital gain depending on
the period the participant holds such stock; and (iii) the taxable
amount may be eligible for the special forward averaging provisions of
the Code.
(f)The taxable amount of a total or partial withdrawal may generally be
rolled over to an Individual Retirement Account (IRA) or other
qualified plan and payment of taxes may thereby be deferred, subject to
automatic income tax withholding of twenty percent (20%) on amounts not
distibuted in Common Stock.
10
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
(g)The taxable amount of an account, subject to total and partial
withdrawal provisions, can be transferred directly to an IRA or other
qualified plan and payment of taxes may thereby be deferred.
Participants are encouraged to determine the effect on their federal
income tax liability of receiving distributions from the Plan.
Amendment, Modification, Suspension and Termination -- It is the
intention of the Company to continue the Plan indefinitely; however, the
Company, by action of its Board of Directors, may amend, modify or suspend the
Plan at any time, or from time to time, and may terminate the Plan at any
time; and any Employer-corporation may withdraw from participation in the Plan
at any time upon thirty days notice.
In the event of termination of the Plan in whole or in part or
termination of participation of any Employer-corporation, each participant in
the Plan affected by such termination shall receive a distribution of the
entire balance in the participant's account, whether derived from Basic and
Supplemental Employee Savings or employer contributions.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting -- The financial statements of the Plan are
prepared under the accrual method of accounting.
Use of Estimates -- The preparation of financial statements requires
the use of significant estimates and assumptions by management. Actual results
could differ from those estimates.
Valuation of Investment Securities -- Participant investments in all
funds except for the Interest Income Fund are accounted for as units and
stated at fair value based upon closing sales prices on recognized securities
exchanges on the last business day of the fiscal year. The Interest Income
Fund insurance contracts and the financial institution investment contracts
are valued at contract value. Contract value represents contributions made by
participants, plus interest at the contract rates, less withdrawals or
transfers by participants. Fair value is estimated using discounted cash
flows. Following is additional information reported in the aggregate for the
Interest Income Fund:
Contract Value of assets as of December 31, 1998: $61,433,407
Fair Value of assets as of December 31, 1998: $62,901,137
Average Yield of assets on December 31, 1998: 6.42%
Return on assets for 12 months ended December 31, 1998: 6.60%
The average yield of assets on December 31, 1997 was 6.67%. The return
on assets for 12 months ended December 31, 1997 was 6.83%.
Expenses -- All costs and expenses of the Plan and its administration,
except expenses incurred in the generation and administration of
participant loans and in the acquisition or disposition of investments, are
paid by the Employer-corporations.
Presentation -- Certain previously reported amounts have been
reclassified to conform to current presentations.
11
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
New Accounting Pronouncement -- In June 1998, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards Number 133
(SFAS 133) "Accounting for Derivative Instruments and Hedging Activities."
This statement, which is required to be adopted for annual periods beginning
after June 15, 2000, establishes standards for recognition and measurement of
derivative and hedging activities. The Plan has not yet determined the
financial statement impact, if any, of SFAS 133.
3. LEVERAGED EMPLOYEE STOCK OWNERSHIP PROVISION
In 1990, the Trustee, on behalf of the Plan, borrowed $250,000,000 in the
form of a note payable from an outside lender and purchased 7,142,857 shares
of Common Stock of the Company in connection with the leveraged employee stock
ownership provision (LESOP) of the Plan. The note was purchased from the
lender by the Company later in 1990. The note payable requires repayment of
principal over 17 years beginning in 1998. At December 31, 1998 and 1997, the
note payable bore interest at a fixed rate of 9.81% following its conversion
in January 1992 from a variable rate to a fixed rate. The note payable is
collateralized by 5,141,529 unallocated shares held by the Trustee at December
31, 1998.
The LESOP shares are held by the Trustee until released and allocated to
participants' accounts proportionally based on current debt service payments
including interest to total debt service payments. Debt service payments are
made by the Plan from dividends received on the unallocated shares and, if
necessary, contributions from Employer-corporations. The market value of
shares released reduces the cash requirements of the Employer-corporations for
their funding obligation under the Plan. During the 1998 Plan year the number
of LESOP shares released and allocated to participant accounts was 233,629 and
during the 1997 Plan year the number of LESOP shares released and allocated to
participant accounts was 231,864.
4. PARTICIPANT LOANS
The Plan includes a loan feature allowing participants to borrow from
their pretax employee savings and rollover accounts and repay the loan with
after-tax payroll deductions. Participants are eligible to borrow up to 50%
of their pretax and rollover account balances, including Company
matching contributions, with the minimum amount of a loan being $1,000 and the
maximum being $50,000. Participants may repay the loan back into their
account(s) over a period from 1 to 5 years for a general purpose loan, and the
shorter of 15 years or their remaining mortgage term for a primary home loan.
The rate of interest charged is the Trustee's current prime lending rate plus
an additional 2%.
12
<PAGE>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
5. UNIT VALUES
Units in each fund at December 31, 1998 and 1997, and net asset value per
unit, are presented below. All net asset values per share or unit exclude any
related participant loan receivables.
1998 1997
---- ----
Common Stock:
Number of shares 7,185,250 6,879,589
Net asset value per share* $47.74 $44.46
Bond Index Fund:
Number of units 1,235,024 1,011,477
Net asset value per unit $10.35 $10.16
Interest Income Fund:
Number of units 10,277,082 10,370,853
Net asset value per unit $6.01 $5.62
Equity Income Fund:
Number of units 1,521,634 1,346,502
Net asset value per unit $55.88 $52.79
Equity Index Fund:
Number of units 554,520 1,105,972
Net asset value per unit $113.99 $35.35
Equity International Fund:
Number of units 38,286 --
Net asset value per unit $17.50 --
Equity Small Company Fund:
Number of units 42,525 --
Net asset value per unit $20.26 --
Balanced Fund:
Number of units 1,515,946 1,262,193
Net asset value per unit $18.86 $19.45
Equity Growth Fund:
Number of units 3,372,685 2,980,414
Net asset value per unit $29.09 $24.10
- -------------
* The calculation of net asset value per share for Common Stock
includes the value of the LESOP note net of the value of the
unallocated LESOP shares.
6. OTHER ITEMS
During 1998, the IRS notified the Plan Committee that the Plan would be
under examination. The Plan years subject to examination are the Plan years
ending with or within the tax years ending December 31, 1994, 1995 and 1996.
The examination is currently in a preliminary state and no findings have
been communicated to the Plan Committee.
13
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
SUPPLEMENTAL SCHEDULES
- ----------------------
ITEM 27a -- SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES, DECEMBER 31, 1998
Description of Investment,
Identity of Issue, Including Collateral, Rate of
Borrower, Lessor, Interest, Maturity Date, Shares, Current
or Similar Party Units, Par or Maturity Value Cost Value(1)
- ------------------ -------------------------------- ---- -------
<S> <C> <C> <C>
COMMON STOCK
Common Stock
- ------------
TXU (2) 12,337,552 shares $513,236,394 $576,009,459
Money Market Funds
Mellon Bank, N.A. (2) Cash management fund -
603,420 units 603,420 603,420
------------ ------------
TOTAL COMMON STOCK 513,839,814 576,612,879
------------ ------------
BOND INDEX FUND
Vanguard Bond Index
Fund -- Total Bond
Market Portfolio 1,235,024 units 12,703,918 12,683,693
------------ ------------
INTEREST INCOME FUND
Value of Interest in General Accounts
- -------------------------------------
Business Men's Assurance
Co. of America Contract No. 1207, 6.90%, due 2001 2,593,094 2,593,094
Safeco Life
Insurance Company Contract No. LP-1052795, 6.09%, due 2005 2,518,771 2,518,771
New York Life
Insurance Company Contract No. GA-30839, 6.19%, due 2002 2,073,727 2,073,727
Hartford Life
Insurance Company Contract No. GA-9260, 7.92%, due 1999 1,729,701 1,729,701
Jackson National Life
Insurance Company Contract No. G-1004-1, 5.81%, due 2005 2,091,785 2,091,785
John Hancock Life
Insurance Company Contract No. GAC-8897, 7.01%, due 2001 2,551,097 2,551,097
First Chicago Master
Trust Contract No. 95-810, 7.54%, due 2005 2,506,055 2,506,055
Protective Life
Insurance Company Contract No. GA-1427, 5.96%, due 2002 2,034,554 2,034,554
Life of Virginia Contract No. GS-3154, 6.07%, due 2002 2,575,797 2,575,797
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
SUPPLEMENTAL SCHEDULES
- ----------------------
ITEM 27a -- SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES, DECEMBER 31, 1998 (continued)
Description of Investment,
Identity of Issue, Including Collateral, Rate of
Borrower, Lessor, Interest, Maturity Date, Shares, Current
or Similar Party Units, Par or Maturity Value Cost Value(1)
- ------------------ -------------------------------- ---- -------
<S> <C> <C> <C>
Ohio National Life
Insurance Company Contract No. GP-5258, 5.81%, due 2002 2,002,787 2,002,787
Travelers
Insurance Company Contract No. GR-17065, 5.32%, due 2003 2,523,900 2,523,900
Metropolitan Life
Insurance Company Contract No. GAC-24686, 6.88%, due 2005 2,946,612 2,946,612
Transamerica Occidental
Insurance Company Contract No. 51492, 6.33%, due 2001 2,518,989 2,518,989
----------- -----------
Total Value of Interest in General Accounts 30,666,869 30,666,869
Money Market Funds
- ------------------
Mellon Bank, N.A. (2) Cash management fund -
4,310,107 units 4,310,107 4,310,107
----------- -----------
United States Government Obligations
- ------------------------------------
FNMA/FHLMC 9,136,555 units 9,136,555 9,136,555
----------- -----------
Other
- -----
Monumental Manager
Trust Contract No. BDA-00284TR, 6.53%:
NTQA Multiple Mortgage - Backed Securities
Bond Index Fund 2,581,627 2,581,627
NTQA Multiple Asset-Backed Securities
Bond Index Fund 5,207,698 5,207,698
NTQA Multiple Long-Term
Government Bond Index Fund 694,056 694,056
NTQA Multiple Intermediate
Government Bond Index Fund 4,491,985 4,491,985
NTQA Multiple Intermediate
Corporate Bond Index Fund 4,344,510 4,344,510
----------- -----------
17,319,876 17,319,876
----------- -----------
TOTAL INTEREST INCOME FUND 61,433,407 61,433,407
----------- -----------
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
SUPPLEMENTAL SCHEDULES
- ----------------------
ITEM 27a -- SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES, DECEMBER 31, 1998 (continued)
Description of Investment,
Identity of Issue, Including Collateral, Rate of
Borrower, Lessor, Interest, Maturity Date, Shares, Current
or Similar Party Units, Par or Maturity Value Cost Value(1)
- ------------------ -------------------------------- ---- -------
<S> <C> <C> <C>
EQUITY INCOME FUND
Fidelity Equity -
Income Fund 1,521,634 units 58,368,727 84,526,781
------------ ------------
EQUITY INDEX FUND
Vanguard Institutional
Index Fund 554,520 units 49,973,791 62,577,568
------------ ------------
EQUITY INTERNATIONAL FUND
American AAdvantage
International Fund 38,286 units 631,927 652,772
------------ ------------
EQUITY SMALL COMPANY FUN
SSgA Small Capitalization
Fund 42,525 units 736,136 825,407
------------ ------------
BALANCED FUND
Hotchkis and Wiley Balance
Income Fund 1,515,946 units 28,228,361 28,257,227
------------ ------------
EQUITY GROWTH FUND
American Express IDS New
Dimensions Fund 3,372,685 units 65,709,745 97,285,096
------------ ------------
LOAN FUND
Participant Loans
Receivable (3) 21,722,716 units 21,722,716 21,722,716
------------ ------------
TOTAL ALL FUNDS $813,348,542 $946,577,546
============ ============
<FN>
(1) Current value for the Interest Income Fund is based on contract value.
(2) Party-in-Interest
(3) The rate of interest charged is the Trustee's current prime lending rate
plus an additional 2%. During 1998, the rate of interest charged ranged
from 9.75% to 10.50%. Maturities range from 1 to 5 years for general
purpose loans and up to 15 years for a primary home loan.
</FN>
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
EMPLOYEES' THRIFT PLAN OF THE TEXAS UTILITIES COMPANY SYSTEM
- -------------------------------------------------------------
SUPPLEMENTAL SCHEDULES
- ----------------------
ITEM 27d -- SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED
- -------------------------------------------------------------------
DECEMBER 31, 1998
- -----------------
Transactions involving an amount in excess of 5% of the fair value of
beginning plan assets.
Current Value
of Asset
Identity of Description Purchase Selling Expense Incurred Cost of on Transaction
Party Involved of Asset Price Price With Transaction Asset Date Net Gain
- -------------- ----------- -------- ------- ---------------- ------- -------------- --------
<S> <C> <C> <C> <C> <C> <C> <S>
Exceeding 5%
of Plan Assets
(in the Aggregate):
Series of
Transactions:
Various TXU Stock $35,091,828 $ -- $ -- $35,091,828 $35,091,828 $ --
Various TXU Stock -- 29,798,700 -- 29,583,624 29,798,700 215,076
Various Fidelity Spartan
US Equity Index
Fund -- 48,016,745 -- 37,282,773 48,016,745 10,773,972
Various Vanguard
Institutional
Index Fund 52,273,955 -- -- 52,273,955 52,273,955 --
Single
Transactions:
Various Fidelity Spartan
US Equity Index
Fund -- 45,928,496 -- 35,909,768 45,928,496 10,018,728
Various Vanguard
Institutional
Index Fund 45,928,496 -- -- 45,928,496 45,928,496 --
17
<PAGE>
INDEPENDENT AUDITORS' REPORT
Employees' Thrift Plan Committee
Employees' Thrift Plan of the
Texas Utilities Company System:
We have audited the accompanying statements of net assets available for
benefits of the Employees' Thrift Plan of the Texas Utilities Company System
(the "Plan") as of December 31, 1998 and 1997, and the related statements of
changes in net assets available for benefits for the years then ended. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan at December 31,
1998 and 1997, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental information by fund
is presented for the purpose of additional analysis of the basic financial
statements rather than to present information regarding the net assets
available for benefits and changes in net assets available for benefits of the
individual funds, and is not a required part of the basic financial
statements. The accompanying supplemental schedules of (1) assets held for
investment purposes at December 31, 1998 and (2) reportable (5%) transactions
for the year ended December 31, 1998 are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental information by fund
and supplemental schedules are the responsibility of the Plan's management.
Such supplemental information by fund and supplemental schedules have been
subjected to the auditing procedures applied in our audit of the basic 1998
financial statements and, in our opinion, are fairly stated in all material
respects when considered in relation to the basic financial statements taken
as a whole.
DELOITTE & TOUCHE LLP
Dallas, Texas
June 25, 1999
18
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Employees' Thrift Plan Committee has duly caused this annual report to be
signed on its behalf by the undersigned thereunto duly authorized.
EMPLOYEES' THRIFT PLAN OF THE
TEXAS UTILITIES COMPANY SYSTEM
------------------------------
By /s/ Robert L. Turpin
Robert L. Turpin, Assistant Secretary
Employees' Thrift Plan Committee
June 29, 1999
19
</TABLE>
<PAGE>
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333-32839 of Texas Utilities Company on Form S-8 of our report dated June 25,
1999, appearing in this Annual Report on Form 11-K of the Employees' Thrift
Plan of the Texas Utilities Company System for the year ended December 31,
1998.
DELOITTE & TOUCHE LLP
Dallas, Texas
June 28, 1999
