<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 12, 1997
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
ENRON CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
OREGON
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
47-0255140
(I.R.S. EMPLOYER IDENTIFICATION NO.)
REX R. ROGERS, ESQ.
ENRON CORP.
ASSISTANT GENERAL COUNSEL
1400 SMITH STREET, HOUSTON, TEXAS 77002
(713) 853-3069
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL
EXECUTIVE OFFICES AND AGENT FOR SERVICE)
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: FROM TIME
TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT AS DETERMINED IN
LIGHT OF MARKET CONDITIONS AND OTHER FACTORS.
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, PLEASE 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. [ ]
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SECURITY PRICE FEE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Enron Corp. Debt Securities....) ) )
- -------------------------------) ) )
Warrants to Purchase Common ) ) )
Stock(1).....................) ) )
- -------------------------------) $1,000,000,000(3) (4) ) $1,000,000,000(5) ) $303,031(6)
Enron Corp. Preferred Stock....) ) )
- -------------------------------) ) )
Enron Corp. Depositary ) ) )
Shares(2)....................) ) )
- -------------------------------) ) )
=====================================================================================================================
</TABLE>
(1) Consists of warrants to purchase up to 7.5 million shares of Enron Corp.
Common Stock previously registered.
(2) The consideration for the Enron Corp. Depositary Shares is included in that
for the Enron Corp. Preferred Stock.
(3) Pursuant to Rule 429 under the Securities Act of 1933, this Registration
Statement contains a combined prospectus that also relates to 7.5 million
shares of Enron Corp. Common Stock previously registered on Form S-3,
Registration No. 33-53877. The maximum aggregate offering price of
securities covered by such combined prospectus (in addition to the 7.5
million shares of Enron Corp. Common Stock previously registered) is
$1,000,000,000. Without limitation as to class of securities, securities of
the classes listed in the above table may be offered pursuant to such
combined prospectus at a maximum aggregate offering price of $1,000,000,000.
(4) The proposed maximum offering price per security is equal to (a) 100% of the
principal amount thereof in the case of Enron Corp. Debt Securities and (b)
the proposed maximum aggregate offering price divided by the number of
shares offered in the case of other securities.
(5) Estimated solely for the purposes of calculating the registration fee.
(6) Paid herewith.
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 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
Pursuant to Rule 429 under the Securities Act of 1933, this Registration
Statement contains a combined prospectus that also relates to 7.5 million shares
of Enron Corp. Common Stock previously registered on Registration Statement No.
33-53877, which was declared effective on July 14, 1994 (the "Previously
Registered Securities"). This Registration Statement constitutes Post-Effective
Amendment No. 3 to Registration Statement No. 33-53877, pursuant to which the
total amount of unsold Previously Registered Securities registered on
Registration Statement No. 33-53877 may be offered and sold together with the
securities registered hereunder through the use of the combined Prospectus
included herein. In the event such Previously Registered Securities are offered
and sold prior to the effective date of this Registration Statement, the amount
of such Previously Registered Securities so sold will not be included in the
prospectus hereunder.
================================================================================
<PAGE> 2
EXPLANATORY NOTE
ADOPTION OF PREDECESSOR ISSUER'S REGISTRATION STATEMENT
Effective July 1, 1997, Enron Corp. (formerly Enron Oregon Corp.), an
Oregon corporation, became the successor issuer to the Common Stock and Debt
Securities of Enron Corp., a Delaware corporation. The succession transaction
was a reincorporation merger (the "Reincorporation Merger") of Enron Corp., a
Delaware corporation ("Old Enron"), with and into the registrant ("Enron"),
which, until the Reincorporation Merger, was a wholly-owned subsidiary of Old
Enron. As a result of the Reincorporation Merger, (i) each issued share of
common stock, par value $.10 per share, of Old Enron was converted into one
share of common stock, without par value, of the registrant, and (ii) each
issued and outstanding share of Cumulative Second Preferred Convertible Stock,
par value $1.00 per share, of Old Enron was converted into one share of
Cumulative Second Preferred Convertible Stock, without par value, of the
registrant, and (iii) each issued and outstanding share of 9.142% Perpetual
Second Preferred Stock, par value $1.00 per share, of Old Enron was converted
into one share of 9.142% Perpetual Second Preferred Stock, without par value, of
the registrant. Immediately following the Reincorporation Merger, also on July
1, 1997, the registrant acquired Portland General Corporation ("PGC") by means
of the merger of PGC with and into the registrant. Enron's Form 8-B Registration
Statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act") was declared effective on July 22, 1997.
Pursuant to Rule 429 under the Securities Act of 1933 (the "Securities
Act"), this Registration Statement contains a combined prospectus that also
relates to 7.5 million shares of Enron common stock previously registered on Old
Enron's Registration Statement No. 33-53877, which was declared effective on
July 14, 1994. This filing constitutes Post-Effective Amendment No. 3 to Old
Enron's Registration Statement No. 33-53877, and is filed pursuant to Rule
414(d) under the Securities Act. Post-Effective Amendment No. 2 to such
Registration Statement No. 33-53877, which was also filed pursuant to Rule
414(d) under the Securities Act, was declared effective on July 22, 1997. Enron
expressly adopts such Registration Statement No. 33-53877 as its own for all
purposes of the Securities Act and the Exchange Act.
<PAGE> 3
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 SEPTEMBER 12, 1997
PROSPECTUS
[ENRON LOGO]
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
WARRANTS TO PURCHASE COMMON STOCK
------------------------
Enron Corp. ("Enron") may offer from time to time (i) secured or unsecured
debt securities ("Debt Securities") consisting of debentures, notes or other
secured or unsecured evidences of indebtedness in one or more series, and (ii)
shares of Preferred Stock, no par value ("Preferred Stock"), in one or more
series, which may be represented by depositary shares ("Depositary Shares")
evidenced by depositary receipts, or (iii) any combination of the foregoing, at
an aggregate initial public offering price not to exceed $1,000,000,000, at
prices and on terms to be determined at or prior to the time of sale. In
addition, Enron may offer from time to time up to 7.5 million shares of Enron
common stock, no par value ("Common Stock"), at prices and on terms to be
determined at or prior to the time of sale. Enron may offer from time to time
warrants to purchase up to 7.5 million shares of Common Stock ("Stock Warrants")
and Common Stock issuable upon exercise of Stock Warrants, at prices and on
terms to be determined at or prior to the time of sale.
Specific terms of the securities in respect of which this Prospectus is
being delivered ("Offered Securities") will be set forth in an accompanying
Prospectus Supplement ("Prospectus Supplement"), together with the terms of the
offering of the Offered Securities, the initial price thereof and the net
proceeds from the sale thereof. The Prospectus Supplement will set forth with
regard to the particular Offered Securities, without limitation, the following:
(i) in the case of Debt Securities, the specific designation, aggregate
principal amount, authorized denomination, maturity, rate (which may be fixed or
variable) or method of calculation of interest and dates for payment thereof,
and any exchangeability, conversion, redemption, prepayment or sinking fund
provisions and any listing on a securities exchange, and (ii) in the case of
Preferred Stock, the designation, number of shares or fractional interests
therein, liquidation preference per share, initial public offering price,
dividend rate (or method of calculation thereof), dates on which dividends shall
be payable and dates from which dividends shall accrue, any redemption or
sinking fund provisions and any listing on a securities exchange. If shares of
Preferred Stock are to be represented by Depositary Shares, the Prospectus
Supplement will set forth the fraction of a share of such Preferred Stock
represented by one Depositary Share. With regard to Stock Warrants, if any, the
Prospectus Supplement will contain a description of the Common Stock for which
each warrant is exercisable and the offering price, if any, exercise price,
duration, detachability, call provisions, and other principal terms of the
warrants.
Enron may sell the Offered Securities directly, through agents designated
from time to time or through underwriters or dealers. See "Plan of
Distribution." If any underwriters are involved in the sale of the Offered
Securities, the names of such underwriters and any applicable commissions and
discounts will be set forth in the related Prospectus Supplement.
This Prospectus may not be used to consummate sales of Offered Securities
unless accompanied by a Prospectus Supplement.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR 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.
------------------------
The date of this Prospectus is , 1997.
<PAGE> 4
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR
IN A PROSPECTUS SUPPLEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY ENRON.
NEITHER THIS PROSPECTUS NOR ANY PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER OF
ANY SECURITIES OTHER THAN THOSE TO WHICH IT RELATES OR AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, TO ANY PERSON IN ANY JURISDICTION WHERE SUCH AN
OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS
OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE HEREUNDER OR THEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN
OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THEREOF.
AVAILABLE INFORMATION
Enron is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act"), and in accordance therewith files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information 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: Midwest
Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511; and Northeast Regional Office, 7 World Trade Center, 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., Room 1024,
Washington, D.C. 20549, at prescribed rates or from the site maintained by the
Commission on the Internet World Wide Web at http://www.sec.gov. Enron's Common
Stock is listed on the New York, Midwest and Pacific Stock Exchanges. Reports,
proxy statements and other information concerning Enron can be inspected and
copied at the respective offices of these exchanges at 20 Broad Street, New
York, New York 10005; 120 South LaSalle Street, Chicago, Illinois 60603; and 301
Pine Street, San Francisco, California 94014.
This Prospectus constitutes a part of Registration Statements on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statements") filed with the Commission under the Securities Act of 1933 (the
"Securities Act") with respect to the Offered Securities. This Prospectus does
not contain all of the information set forth in such Registration Statements,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. Reference is made to such Registration Statements and to the
exhibits relating thereto for further information with respect to Enron and the
Offered Securities. Any statements contained herein concerning the provisions of
any document filed as an exhibit to any of the Registration Statements or
otherwise filed with the Commission or incorporated by reference herein are not
necessarily complete, and in each instance reference is made to the copy of such
document so filed for a more complete description of the matter involved. Each
such statement is qualified in its entirety by such reference.
2
<PAGE> 5
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Effective July 1, 1997, Enron Corp., a Delaware corporation ("Old Enron"),
was reincorporated in Oregon by means of a merger with and into Enron Oregon
Corp., an Oregon corporation, which changed its name to Enron Corp. upon
consummation of the merger. Unless the context otherwise requires, as used
herein the term "Enron" refers to Enron Corp., an Oregon corporation, and to Old
Enron, its predecessor Delaware corporation.
The following documents filed by Enron with the Commission pursuant to the
Exchange Act are incorporated herein by reference:
(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1996;
(b) Quarterly Reports on Form 10-Q for the quarters ended March 31,
1997 and June 30, 1997;
(c) Current Reports on Form 8-K dated July 15, 1997 and August 29,
1997; and
(d) The description of Enron's capital stock set forth in Enron's
Registration Statement on Form 8-B filed on July 2, 1997.
The following documents filed by Old Enron with the Commission pursuant to
the Exchange Act are incorporated herein by reference:
(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1996;
(b) Current Report on Form 8-K dated March 17, 1997;
(c) Quarterly Report on Form 10-Q for the quarter ended March 31,
1997; and
(d) Current Report on Form 8-K dated June 5, 1997.
Each document filed by Enron pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the Offered Securities pursuant hereto shall be
deemed to be incorporated herein by reference and to be a part hereof from the
date of filing of such document. Any statement contained herein or in a document
all or a portion of which is incorporated or deemed to be incorporated by
reference herein 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 also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
Enron will provide without charge to each person to whom a copy of this
Prospectus is delivered, on the request of any such person, a copy of any or all
of the foregoing documents incorporated herein by reference other than exhibits
to such documents (unless such exhibits are specifically incorporated by
reference into the documents that this Prospectus incorporates). Written or
telephone requests for such copies should be directed to Secretary Division,
Enron Corp., at its principal executive offices, 1400 Smith Street, Houston,
Texas 77002 (telephone: 713-853-6161).
3
<PAGE> 6
BUSINESS OF ENRON
Enron, an Oregon corporation, is an integrated natural gas and electricity
company headquartered in Houston, Texas. Essentially all of Enron's operations
are conducted through its subsidiaries and affiliates which are principally
engaged in the transportation and wholesale marketing of natural gas to markets
throughout the United States and internationally through approximately 36,000
miles of natural gas pipelines; the exploration for and production of natural
gas and crude oil in the United States and internationally; the production,
purchase, transportation and worldwide marketing of natural gas liquids and
refined petroleum products; the independent (i.e., non-utility) development,
promotion, construction and operation of power plants, natural gas liquids
facilities and pipelines in the United States and internationally; and the
non-price regulated purchasing and marketing of electricity and other energy
related commitments.
On July 1, 1997, Enron acquired Portland General Corporation, the parent
company of Portland General Electric Company ("PGE"), by means of a merger of
Portland General Corporation with and into Enron. As a result of the merger, PGE
is a subsidiary of Enron. PGE is an electric utility engaged in the generation,
purchase, transmission, distribution and sale of electricity in the State of
Oregon. PGE also sells energy to wholesale customers throughout the western
United States.
TRANSPORTATION AND OPERATION. Enron's operations include interstate
transmission of natural gas, construction, management and operation of natural
gas and natural gas liquids pipelines, liquids plants, clean fuel plants and
power facilities. Enron and its subsidiaries operate domestic interstate
pipelines extending from Texas to the Canadian border and across the southern
United States from Florida to California. Included in Enron's domestic
interstate natural gas pipeline operations are Northern Natural Gas Company
("Northern"), Transwestern Pipeline Company ("Transwestern"), and Florida Gas
Transmission Company ("Florida Gas") (indirectly 50% owned by Enron), and all
such pipelines are subject to the regulatory jurisdiction of the Federal Energy
Regulatory Commission. Each pipeline serves customers in a specific geographical
area: Northern, the upper Midwest; Transwestern, principally the California
market and pipeline interconnects on the east end of Transwestern's system; and
Florida Gas, the State of Florida. In addition, Enron holds a 13% interest in
Northern Border Partners, L.P., which owns a 70% interest in the Northern Border
Pipeline system. An Enron subsidiary operates the Northern Border Pipeline
system, which transports gas from western Canada to delivery points in the
midwestern United States.
DOMESTIC GAS AND POWER SERVICES. Through its wholly owned subsidiary Enron
Capital & Trade Resources Corp. and its affiliated companies ("ECT"), Enron
purchases natural gas, natural gas liquids, electricity and other energy
products through a variety of contractual arrangements, including both short-
term and long-term contracts, the arrangement of production payment and other
financing transactions, and other contractual arrangements. ECT markets these
energy products to local distribution companies, electric utilities,
cogenerators, and both commercial and industrial end-users. ECT also provides
price risk management services in connection with natural gas, natural gas
liquids and electricity transactions through both physical delivery and
financial arrangements.
ECT offers a broad range of non-price regulated natural gas merchant
services by tailoring a variety of supply and marketing options to its
customers' specific needs. ECT's strategy is to provide predictable pricing,
reliable delivery and low cost capital to its customers. ECT provides these
services through a variety of instruments, including forward contracts, swap
agreements and other contractual commitments.
Enron recently established Enron Energy Services ("EES") to pursue the
significant growth opportunities in anticipation of a fully competitive retail
natural gas and electricity market. As states begin to deregulate their natural
gas and electricity markets, and as these markets continue to converge, EES's
goal is to provide end-users with a broad range of energy choices at more
competitive prices. EES has participated in selected natural gas and electric
retail marketing pilot programs, including a state-wide electricity pilot in New
Hampshire, where individual customers are free to select the power provider of
their choice. EES will continue to participate in such programs.
4
<PAGE> 7
INTERNATIONAL OPERATIONS AND DEVELOPMENT. Enron's international activities
principally involve the independent (non-utility) development, acquisition,
financing, promotion and operation of natural gas and power projects in emerging
markets, and the marketing of natural gas liquids and other liquid fuels.
Development projects are focused on power plants, gas processing and terminaling
facilities, and gas pipelines, while marketing activities center on fuels used
by or transported through such facilities. Enron's international activities
include management of direct and indirect ownership interests in and operation
of power plants in England, Germany, Guatemala, the Dominican Republic, the
Philippines and China; pipeline systems in Argentina and Colombia; retail gas
and propane sales in the Caribbean basin; processing of natural gas liquids at
Teesside, England; and marketing of natural gas liquids and other liquid fuels
worldwide. Enron is also involved in power, pipeline and liquefied natural gas
projects in varying stages of development in China, India, Puerto Rico, Italy,
Turkey, Qatar, Vietnam, Israel, Jordan, Bolivia, Brazil, Indonesia, Poland and
elsewhere.
EXPLORATION AND PRODUCTION. Substantially all of Enron's natural gas and
crude oil exploration and production operations are conducted by its subsidiary,
Enron Oil & Gas Company ("EOG"). EOG is engaged in the exploration for, and
development and production of, natural gas and crude oil primarily in major
producing basins in the United States, as well as in Canada, Trinidad, India
and, to a lesser extent, selected other international areas. At December 31,
1996, EOG had estimated net proved natural gas reserves of 3,675 billion cubic
feet, including 1,180 billion cubic feet of proved undeveloped methane reserves
in the Big Piney, Wyoming deep Paleozoic formations, and estimated net proved
crude oil, condensate and natural gas liquids reserves of 55 million barrels,
and at such date, approximately 74% of EOG's reserves (on a natural gas
equivalent basis) was located in the United States, 9% in Canada, 10% in
Trinidad, and 7% in India. Enron currently owns 53% of the outstanding common
stock of EOG.
Enron, an Oregon corporation, has its principal executive offices at 1400
Smith Street, Houston, Texas 77002, and its telephone number is 713-853-6161.
5
<PAGE> 8
USE OF PROCEEDS
The net proceeds from the sale of the Offered Securities will be added to
Enron's general funds and are expected to be used to retire existing
indebtedness and for general corporate purposes, except as may be stated in a
Prospectus Supplement.
RATIO OF ENRON'S EARNINGS TO FIXED CHARGES
AND EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30, --------------------------------------------------------
1997 1996 1995 1994 1993 1992
---------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges.......... (1) 3.00 2.92 2.34 1.98 1.74
Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends................. (1) 2.58 2.49 2.13 1.88 1.64
</TABLE>
- ---------------
(1) For the six months ended June 30, 1997, earnings were inadequate to cover
fixed charges and combined fixed charges and preferred stock dividends by
$305 million and $371 million, respectively.
The ratios of earnings to fixed charges and preferred stock dividends are
based on continuing operations. "Earnings" represent the aggregate of (a) the
pre-tax income of Enron and its majority owned subsidiaries, (b) Enron's share
of pre-tax income of its 50% owned companies, (c) any income actually received
from less than 50% owned companies, and (d) fixed charges, net of interest
capitalized. "Fixed Charges" represent interest (whether expensed or
capitalized), amortization of debt discount and expense and that portion of
rentals considered to be representative of the interest factor. "Fixed Charges
and Preferred Stock Dividends" represent fixed charges (as described above) and
preferred stock dividend requirements of Enron and its majority owned
subsidiaries.
6
<PAGE> 9
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate (the "Offered Debt Securities"). The particular
terms of the Offered Debt Securities and the extent, if any, to which such
general provisions may apply to the Offered Debt Securities will be described in
the Prospectus Supplement relating to such Offered Debt Securities.
The Offered Debt Securities will be secured or unsecured obligations of
Enron. Any such unsecured obligations will be issued under an Indenture (the
"Indenture") between Enron and Harris Trust and Savings Bank, as Trustee (the
"Trustee"), dated as of November 1, 1985, as supplemented. The following
statements are summaries of certain provisions contained in the Indenture, the
form of which is filed as an exhibit to the Registration Statements of which
this Prospectus is a part. Reference is hereby made to the Indenture for full
and complete statements of such terms and provisions, including the definitions
of certain terms used herein. Wherever reference is made in the following
statements to a particular section of the Indenture, such section shall be
deemed to be incorporated in such statements as a part thereof. If Offered Debt
Securities will be secured obligations of Enron, they will be issued under a
separate indenture, which will be described in the Prospectus Supplement
relating to such Offered Debt Securities.
GENERAL
The Indenture does not limit the aggregate principal amount of unsecured
debentures, notes or other evidences of indebtedness of Enron (the "Indenture
Securities") which may be issued thereunder from time to time in one or more
series by Enron, and Enron may in the future issue additional Indenture
Securities (in addition to the Offered Debt Securities) under the Indenture. At
August 31, 1997, an aggregate of $1,842,000,000 principal amount of Indenture
Securities of Enron was issued and outstanding under the Indenture. Reference is
made to the Prospectus Supplement for the following terms of the Offered Debt
Securities: (i) the title of the Offered Debt Securities; (ii) any limit upon
the aggregate principal amount of the Offered Debt Securities; (iii) the date or
dates on which the principal of the Offered Debt Securities is payable; (iv) the
rate or rates (which may be fixed or variable), or the method by which such rate
or rates shall be determined, at which the Offered Debt Securities shall bear
interest, if any, the date or dates from which such interest shall accrue or the
method by which such date or dates shall be determined, the interest payment
dates on which such interest shall be payable and the regular record date for
the interest payable on any interest payment date; (v) the place or places where
the principal of (and premium, if any) and interest on Offered Debt Securities
shall be payable; (vi) the period or periods within which, the price or prices
at which and the terms and conditions upon which Offered Debt Securities may be
redeemed, in whole or in part, at the option of Enron, if Enron is to have that
option; (vii) the obligation, if any, and the option, if any, of Enron to
redeem, purchase or repay Offered Debt Securities pursuant to any sinking fund
or analogous provisions or at the option of a holder thereof and the period or
periods within which, the price or prices at which and the terms and conditions
upon which Offered Debt Securities shall be redeemed, purchased or repaid in
whole or in part, pursuant to such obligation or option; (viii) any trustees,
paying agents, transfer agents or registrars with respect to Offered Debt
Securities; and (ix) any other terms of the Offered Debt Securities (which terms
shall not be inconsistent with the provisions of the Indenture). (Section 301.)
Enron will maintain in each place specified by it for payment of any series
of Offered Debt Securities an office or agency where Offered Debt Securities of
that series may be presented or surrendered for payment, where Offered Debt
Securities of that series may be surrendered for registration of transfer or
exchange and where notices and demands to or upon Enron in respect of the
Offered Debt Securities of that series and the Indenture may be served.
Unless otherwise indicated in the Prospectus Supplement relating thereto,
the Offered Debt Securities will be issued only in fully registered form,
without coupons, in denominations of $1,000 or integral multiples thereof.
(Section 302.) No service charge will be made for any transfer or exchange of
7
<PAGE> 10
such Offered Debt Securities, but Enron may require payment of a sum sufficient
to cover any tax or other governmental charge payable in relation thereto.
(Section 305.)
Debt Securities may be issued under the Indenture as Original Issue
Discount Securities to be offered and sold at a substantial discount below their
principal amount. Material federal income tax, accounting and other
considerations applicable to any such Original Issue Discount Securities will be
described in any Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security which provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof as a result of the occurrence of an Event
of Default and the continuation thereof. (Section 101.)
LIMITATIONS ON MORTGAGES AND LIENS
The Indenture provides that so long as any of the Indenture Securities
issued under the Indenture (including the Offered Debt Securities) are
outstanding, Enron will not, and will not permit any Subsidiary (as defined in
the Indenture and herein) to, pledge, mortgage or hypothecate, or permit to
exist, except in favor of Enron or any Subsidiary, any mortgage, pledge or other
lien upon, any Principal Property (as defined in the Indenture and herein) at
any time owned by it, to secure any indebtedness (as defined in the Indenture),
unless effective provision is made whereby outstanding Indenture Securities
(including the Offered Debt Securities) will be equally and ratably secured with
any and all such indebtedness and with any other indebtedness similarly entitled
to be equally and ratably secured. This restriction does not apply to prevent
the creation or existence of: (a) mortgages, pledges, liens or encumbrances on
any property held or used by Enron or a Subsidiary in connection with the
exploration for, development of or production of, oil, gas, natural gas
(including liquified gas and storage gas), other hydrocarbons, helium, coal,
metals, minerals, steam, timber, geothermal or other natural resources or
synthetic fuels, such properties to include, but not be limited to, Enron's or a
Subsidiary's interest in any mineral fee interests, oil, gas or other mineral
leases, royalty, overriding royalty or net profits interests, production
payments and other similar interests, wellhead production equipment, tanks,
field gathering lines, leasehold or field separation and processing facilities,
compression facilities and other similar personal property and fixtures; (b)
mortgages, pledges, liens or encumbrances on oil, gas, natural gas (including
liquified gas and storage gas), other hydrocarbons, helium, coal, metals,
minerals, steam, timber, geothermal or other natural resources or synthetic
fuels produced or recovered from any property, an interest in which is owned or
leased by Enron or a Subsidiary; (c) mortgages, pledges, liens or encumbrances
(or certain extensions, renewals or refundings thereof) upon any property
acquired before or after the date of the Indenture, created at the time of
acquisition or within one year thereafter to secure all or a portion of the
purchase price thereof, or existing thereon at the date of acquisition, whether
or not assumed by Enron or a Subsidiary, provided that every such mortgage,
pledge, lien or encumbrance applies only to the property so acquired and fixed
improvements thereon; (d) mortgages, pledges, liens or encumbrances upon any
property acquired before or after the date of the Indenture by any corporation
that is or becomes a Subsidiary after the date of the Indenture ("Acquired
Entity"), provided that every such mortgage, pledge, lien or encumbrance (1)
shall either (i) exist prior to the time the Acquired Entity becomes a
Subsidiary or (ii) be created at the time the Acquired Entity becomes a
Subsidiary or within one year thereafter to secure all or a portion of the
acquisition price thereof and (2) shall only apply to those properties owned by
the Acquired Entity at the time it becomes a Subsidiary or thereafter acquired
by it from sources other than Enron or any other Subsidiary; (e) pledges of
current assets, in the ordinary course of business, to secure current
liabilities; (f) deposits to secure public or statutory obligations; (g) liens
to secure indebtedness other than Funded Debt (as defined in the Indenture and
herein); (h) mortgages, pledges, liens or encumbrances upon any office, data
processing or transportation equipment; (i) mortgages, pledges, liens or
encumbrances created or assumed by Enron or a Subsidiary in connection with the
issuance of debt securities the interest on which is excludable from gross
income of the holder of such security pursuant to the Internal Revenue Code of
1986, as amended, for the purpose of financing the acquisition or construction
of property to be used by Enron or a Subsidiary; (j) pledges or assignments of
accounts receivable or conditional sales contracts or chattel mortgages and
evidences of indebtedness secured thereby, received in connection with the sale
by Enron or a
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Subsidiary of goods or merchandise to customers; or (k) certain other liens or
encumbrances. (Section 1007.)
Notwithstanding the foregoing, Enron or a Subsidiary may issue, assume or
guarantee indebtedness secured by a mortgage which would otherwise be subject to
the foregoing restrictions in an aggregate amount which, together with all other
indebtedness of Enron or a Subsidiary secured by a mortgage which (if originally
issued, assumed or guaranteed at such time) would otherwise be subject to the
foregoing restrictions (not including secured indebtedness permitted under the
foregoing exceptions), does not at the time exceed 10% of the Consolidated Net
Tangible Assets (total assets less (a) total current liabilities, excluding
indebtedness due within 12 months, and (b) goodwill, patents and trademarks) of
Enron, as shown on the audited consolidated financial statements of Enron as of
the end of the fiscal year preceding the date of determination. (Section 1007.)
The holders of at least 50% in principal amount of the outstanding
Indenture Securities under the Indenture (including the Offered Debt Securities)
may waive compliance by Enron with the covenant contained in Section 1007 of the
Indenture (and certain other covenants of Enron). (Section 1009.)
The Indenture defines the term "Subsidiary" to mean a corporation all of
the voting shares (that is, shares entitled to vote for the election of
directors, but excluding shares entitled so to vote only upon the happening of
some contingency unless such contingency shall have occurred) of which shall be
owned by Enron or by one or more Subsidiaries or by Enron and one or more
Subsidiaries. The term "Principal Property" is defined to mean any oil or gas
pipeline, gas processing plant or chemical plant located in the United States,
except any such property, pipeline or plant that in the opinion of the Board of
Directors of Enron is not of material importance to the total business conducted
by Enron and its Subsidiaries. "Principal Property" does not include any oil or
gas property or the production or any proceeds of production from an oil or gas
producing property or the production or any proceeds of production of gas
processing plants or oil or gas or petroleum products in any pipeline. (Section
101.)
The term "indebtedness", as applied to Enron or any Subsidiary, is defined
to mean bonds, debentures, notes and other instruments representing obligations
created or assumed by any such corporation for the repayment of money borrowed
(other than unamortized debt discount or premium). All indebtedness secured by a
lien upon property owned by Enron or any Subsidiary and upon which indebtedness
any such corporation customarily pays interest, even though such corporation has
not assumed or become liable for the payment of such indebtedness, is also
deemed to be indebtedness of any such corporation. All indebtedness for money
borrowed incurred by other persons which is directly guaranteed as to payment of
principal by Enron or any Subsidiary is for all purposes of the Indenture deemed
to be indebtedness of any such corporation, but no other contingent obligation
of any such corporation in respect of indebtedness incurred by other persons is
for any purpose deemed indebtedness of such corporation. Indebtedness of Enron
or any Subsidiary does not include (i) amounts which are payable only out of all
or a portion of the oil, gas, natural gas, helium, coal, metals, minerals,
steam, timber or other natural resources produced, derived or extracted from
properties owned or developed by such corporation; (ii) any amount representing
capitalized lease obligations; (iii) any indebtedness incurred to finance oil,
gas, natural gas, helium, coal, metals, minerals, steam, timber, hydrocarbons or
geothermal or other natural resources or synthetic fuel exploration or
development, payable, with respect to principal and interest, solely out of the
proceeds of oil, gas, natural gas, helium, coal, metals, minerals, steam,
timber, hydrocarbons or geothermal or other natural resources or synthetic fuel
to be produced, sold and/or delivered by Enron or any Subsidiary; (iv) indirect
guarantees or other contingent obligations in connection with the indebtedness
of others, including agreements, contingent or otherwise, with such other
persons or with third persons with respect to, or to permit or ensure the
payment of, obligations of such other persons, including, without limitation,
agreements to purchase or repurchase obligations of such other persons,
agreements to advance or supply funds to or to invest in such other persons or
agreements to pay for property, products or services of such other persons
(whether or not conferred, delivered or rendered) and any demand charge,
throughput, take-or-pay, keep-well, make-whole, cash deficiency, maintenance of
working capital or earnings or similar agreements; and (v) any guarantees with
respect to lease or other similar periodic payments to be made by other persons.
(Section 101.)
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The term "Funded Debt" as applied to any corporation means all indebtedness
incurred, created, assumed or guaranteed by such corporation, or upon which it
customarily pays interest charges, which matures, or is renewable by such
corporation to a date, more than one year after the date as of which Funded Debt
is being determined; provided, however, that the term "Funded Debt" shall not
include (i) indebtedness incurred in the ordinary course of business
representing borrowings, regardless of when payable, of such corporation from
time to time against, but not in excess of the face amount of, its installment
accounts receivable for the sale of appliances and equipment sold in the regular
course of business or (ii) advances for construction and security deposits
received by such corporation in the ordinary course of business. (Section 101.)
The foregoing limitations on mortgages, pledges and liens are intended to
limit other creditors of Enron from obtaining preference or priority over
holders of the Indenture Securities issued under the Indenture, but are not
intended to prevent other creditors from sharing equally and ratably and without
preference ("pari passu") over the holders of such Indenture Securities. While
such limitations on mortgages and liens do provide protection to the holders of
the Indenture Securities, there are a number of exceptions to such restrictions
which could result in certain assets of Enron and its Subsidiaries being
encumbered without equally and ratably securing the Indenture Securities issued
under the Indenture. Specifically, the restrictions apply only to pledges,
mortgages or liens upon "Principal Property" (as defined in the Indenture and
herein) to secure any "indebtedness" (as defined in the Indenture and herein),
unless effective provision is made whereby outstanding Securities will be
equally and ratably secured with any such indebtedness and with any other
indebtedness similarly entitled to be equally and ratably secured. There are
certain exceptions to the definition of "indebtedness," which are enumerated in
the Indenture and herein. In addition, the restrictions do not apply to prevent
the creation or existence of mortgages, pledges, liens or encumbrances on
certain types of properties or pursuant to certain types of transactions, all as
enumerated in the Indenture and above. Also, up to 10% of Consolidated Net
Tangible Assets (as defined in the Indenture and herein) is not subject to the
mortgage and lien limitations contained in the Indenture.
Unless otherwise indicated in a Prospectus Supplement, the covenants
contained in the Indenture and the Indenture Securities would not necessarily
afford holders of the Indenture Securities protection in the event of a highly
leveraged or other transaction involving Enron that may adversely affect
holders.
MODIFICATION OF THE INDENTURE
With certain exceptions, the Indenture provides that, with the consent of
the holders of not less than 50% in principal amount of all outstanding
Indenture Securities (including, where applicable, the Offered Debt Securities)
affected thereby, Enron and the Trustee may enter into a supplemental indenture
for the purpose of adding to, changing or eliminating any of the provisions of
the Indenture or of modifying in any manner the rights of the holders of
Indenture Securities under the Indenture. Notwithstanding the foregoing, the
consent of the holder of each outstanding Indenture Security affected thereby
will be required to: (a) change the Stated Maturity (as defined in the
Indenture) of the principal of, or any installment of principal of or interest
on, any Indenture Security, or reduce the principal amount thereof or the rate
of interest thereon or any premium payable upon the redemption thereof, or
change any Place of Payment (as defined in the Indenture) where, or change the
coin or currency in which, any Indenture Security or any premium or the interest
thereon is payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date, as defined in the Indenture); (b)
reduce the percentage in principal amount of the outstanding Indenture
Securities of any series, the consent of whose holders is required for any
supplemental indenture or for any waiver provided for in the Indenture; or (c)
with certain exceptions, modify any of the provisions of the sections of the
Indenture which concern waivers of past defaults, waivers of certain covenants
or consent to supplemental indentures, except to increase the percentage of
principal amount of Indenture Securities of any series, the holders of which are
required to effect such waiver or consent, or to provide that certain other
provisions of the Indenture cannot be modified or waived without the consent of
the holder of each outstanding Indenture Security affected
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thereby. The Indenture provides that a supplemental indenture which changes or
eliminates any covenant or other provision of the Indenture which has expressly
been included solely for the benefit of one or more particular series of
Indenture Securities, or which modifies the rights of the holders of Indenture
Securities of such series with respect to such covenant or other provision,
shall be deemed not to affect the rights under the Indenture of the holders of
Indenture Securities of any other series. (Section 902.)
EVENTS OF DEFAULT AND RIGHTS UPON DEFAULT
Under the Indenture, the term "Event of Default" with respect to any series
of Indenture Securities, means any one of the following events which shall have
occurred and is continuing: (a) default in the payment of any interest upon any
Indenture Security of that series when it becomes due and payable or default in
the payment of any mandatory sinking fund payment provided for by the terms of
any series of Indenture Securities, and continuance of such default for a period
of 30 days; (b) default in the payment of the principal of (or premium, if any,
on) any Indenture Security of that series at its maturity; (c) default in the
performance, or breach, of any covenant or warranty of Enron in the Indenture
(other than a covenant or warranty a default in the performance of which or the
breach of which is otherwise specifically dealt with in the Indenture or which
has been expressly included in the Indenture solely for the benefit of one or
more series of Indenture Securities other than that series), and continuance of
such default or breach for 60 days after there has been given to Enron by the
Trustee, or to Enron and the Trustee by the holders of at least 25% in principal
amount of all outstanding Indenture Securities, a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" under the Indenture; or (d) certain events involving
Enron in bankruptcy, receivership or other insolvency proceedings or an
assignment for the benefit of creditors. (Section 501.)
If an Event of Default described in clause (a) or (b) in the foregoing
paragraph has occurred and is continuing with respect to Indenture Securities of
any series, the Indenture provides that the Trustee or the holders of not less
than 25% in principal amount of the outstanding Indenture Securities of that
series may declare the principal amount of all of the Indenture Securities of
that series to be due and payable immediately, and upon any such declaration
such principal amount shall become immediately due and payable. If an Event of
Default described in clause (c) or (d) of the foregoing paragraph occurs and is
continuing, the Trustee or the holders of not less than 25% in principal amount
of all of the Indenture Securities then outstanding may declare the principal
amount of all of the Indenture Securities to be due and payable immediately, and
upon any such declaration such principal amount shall become immediately due and
payable. (Section 502.)
A default under other indebtedness of Enron is not an Event of Default
under the Indenture, and an Event of Default under one series of Indenture
Securities will not necessarily be an Event of Default under another series.
At any time after such a declaration of acceleration with respect to
Indenture Securities of any series (or of all series, as the case may be) has
been made and before judgment or decree for payment of the money due has been
obtained by the Trustee, the holders of a majority in principal amount of the
outstanding Indenture Securities of that series (or of all series, as the case
may be) may rescind and annul such declaration and its consequences, if, subject
to certain conditions, all Events of Default with respect to Indenture
Securities of that series (or of all series, as the case may be), other than the
non-payment of the principal of the Indenture Securities due solely by such
declaration of acceleration, have been cured or waived and all payments due
(other than by acceleration) have been paid or deposited with the Trustee.
(Section 502.) With certain exceptions, the holders of not less than a majority
in principal amount of the outstanding Indenture Securities of any series, on
behalf of the holders of all the Indenture Securities of such series, may waive
any past default described in clause (a) or (b) of the first paragraph of this
heading "Events of Default and Rights Upon Default" (or, in the case of a
default described in clause (c) or (d) of such paragraph, the holders of a
majority in principal amount of all outstanding Indenture Securities may waive
any such past default), and its consequences, except a default (a) in the
payment of the principal of (or premium, if any) or interest on any Indenture
Security, or (b) in respect of a covenant or provision of the Indenture which
under the Indenture cannot be
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modified or amended without the consent of the holder of each outstanding
Indenture Security of such series affected. (Section 513.)
The holders of not less than a majority in principal amount of the
Indenture Securities of any series at the time outstanding are empowered under
the terms of the Indenture, subject to certain limitations, to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee. (Section
512.)
The Indenture further provides that no holder of an Indenture Security of
any series may enforce the Indenture except in the case of failure by the
Trustee to act for 60 days after notice of a continuing Event of Default with
respect to the Indenture Securities of that series and after request by the
holders of not less than 25% in principal amount of the outstanding Indenture
Securities of such series and the offer to the Trustee of reasonable indemnity,
but this provision will not prevent a holder of any Indenture Security from
enforcing the payment of the principal of, and interest on, such holder's
Indenture Security. (Sections 507 and 508.)
The Indenture requires that Enron deliver to the Trustee, within 120 days
after the end of each fiscal year, an Officer's Certificate, stating whether to
the best knowledge of the signers thereof Enron is in default in the performance
and observance of certain of the terms of the Indenture and, if so, specifying
each such default and the nature and status thereof of which the signers may
have knowledge. (Section 1008.)
DISCHARGE OF INDENTURE
With certain exceptions, Enron may discharge its obligations under the
Indenture with respect to any series of Indenture Securities by (i) paying or
causing to be paid the principal of (and premium, if any) and interest on all
the Indenture Securities of such series outstanding, as and when the same shall
become due and payable; (ii) delivering to the Trustee all outstanding Indenture
Securities of such series for cancellation; or (iii) entering into an agreement
in form and substance satisfactory to Enron and the Trustee providing for the
creation of an escrow fund and depositing in trust with the Trustee, as escrow
agent of such fund, sufficient funds in cash and/or Eligible Obligations and/or
U.S. Government Obligations, maturing as to principal and interest in such
amounts and at such times as will be sufficient to pay at the Stated Maturity or
Redemption Date all such Indenture Securities of such series not previously
delivered to the Trustee for cancellation, including principal (and premium, if
any) and interest to the Stated Maturity or Redemption Date. (Section 401.)
The Indenture defines "Eligible Obligations" to mean interest bearing
obligations as a result of the deposit of which the Indenture Securities are
rated in the highest generic long-term debt rating category assigned to legally
defeased debt by one or more nationally recognized rating agencies. (Section
101.)
For federal income tax purposes, there is a substantial risk that a legal
defeasance of a series of Indenture Securities by the deposit of cash, Eligible
Obligations or U.S. Government Obligations in a trust would be characterized by
the Internal Revenue Service or a court as a taxable exchange by the holders of
the Indenture Securities of that series for either (i) an issue of obligations
of the defeasance trust or (ii) a direct interest in the cash and/or Eligible
Obligations and/or U.S. Government Obligations held in the defeasance trust. If
the defeasance were so characterized, then a holder of an Indenture Security of
the series defeased would be: (i) required to recognize gain or loss (which
would be capital gain or loss if the Indenture Securities were held as a capital
asset) at the time of the defeasance as if the Indenture Security had been sold
at such time for an amount equal to the amount of cash and the fair market value
of the Eligible Obligations and/or U.S. Government Obligations held in the
defeasance trust; (ii) required to include in income in each taxable year the
interest and any original issue discount or gain or loss attributable to either
such defeasance trust obligations or such securities, as the case may be; and
(iii) subject to the market discount provisions of the Internal Revenue Code as
they may pertain to such defeasance trust obligations or such securities. As a
result, a holder of an Indenture Security may be required to pay taxes on any
such gain or income even though such holder may not have received any cash
therefrom. Prospective investors are urged to consult their own advisors as to
the tax consequences
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of an actual or legal defeasance, including the applicability and effect of tax
laws other than federal income tax law.
CONCERNING THE TRUSTEE
Harris Trust and Savings Bank is the Trustee under the Indenture. Such bank
also acts as a depository of funds for, makes loans to, and performs other
services for, Enron in the normal course of business, including acting as
trustee under other indentures of Enron. The corporate trust office of the
Trustee is located at 311 West Monroe, Chicago, Illinois, 60690.
The Trustee may resign from its duties with respect to the Indenture at any
time or may be removed by Enron. If the Trustee resigns, is removed or becomes
incapable of acting as Trustee or a vacancy occurs in the office of the Trustee
for any reason, a successor Trustee shall be appointed in accordance with the
provisions of the Indenture. (Article Six.)
The Indenture contains the provisions required by the Trust Indenture Act
of 1939 with reference to the disqualification of the Trustee if it shall have
or acquire any "conflicting interest", as therein defined. (Section 608.) The
Indenture also contains certain limitations on the right of the Trustee, as a
creditor of Enron, to obtain payment of claims in certain cases, or to realize
on certain property received by it in respect of any such claims, as security or
otherwise. (Section 613.)
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DESCRIPTION OF ENRON CORP. CAPITAL STOCK
AUTHORIZED AND OUTSTANDING CAPITAL STOCK
At August 31, 1997, the authorized capital stock of Enron was 616,500,000
shares, consisting of:
(a) 16,500,000 shares of Preferred Stock, no par value, of which:
(i) 1,338,168 shares of Cumulative Second Preferred Convertible Stock
(the "Convertible Preferred Stock") were outstanding, and (ii) 35.568509
shares of 9.142% Perpetual Second Preferred Stock (the "Perpetual Second
Preferred Stock") were issued and held by an Enron subsidiary; and
(b) 600,000,000 shares of Common Stock, no par value (the "Common
Stock"), of which 298,533,747 shares were outstanding.
The following descriptions of certain of the provisions of the Amended and
Restated Articles of Incorporation of Enron (the "Enron Charter") and the Bylaws
of Enron ("Enron Bylaws") are summaries and do not purport to be complete, and
are qualified in their entirety by reference to the Enron Charter and the Enron
Bylaws filed as exhibits to this Registration Statement.
COMMON STOCK
Enron is authorized to issue up to 600,000,000 shares of Enron Common
Stock. The holders of Enron Common Stock are entitled to one vote for each share
on all matters submitted to a vote of shareholders and do not have cumulative
voting rights in the election of directors. The holders of Enron Common Stock
are entitled to receive ratably such dividends, if any, as may be declared by
the Board of Directors of Enron out of legally available funds subject to the
rights of any preferred stock. In the event of liquidation, dissolution or
winding up of Enron, the holders of Enron Common Stock are entitled to share
ratably in all assets of Enron remaining after provision for payment of
liabilities and satisfaction of the liquidation preference of any shares of
Enron Preferred Stock that may be outstanding. The holders of Enron Common Stock
have no preemptive, subscription, redemption or conversion rights. The rights,
preferences and privileges of holders of Enron Common Stock are subject to those
of holders of Enron Preferred Stock, including any series of Enron Preferred
Stock issued in the future.
PREFERRED STOCK
The following is a general description of the terms of the Preferred Stock
of Enron. The particular terms of any series of Preferred Stock offered hereby
("Offered Preferred Stock") will be set forth in the Prospectus Supplement
relating thereto. The rights, preferences, privileges and restrictions,
including dividend rights, voting rights, terms of redemption and liquidation
preferences, of the Offered Preferred Stock of each series will be fixed or
designated pursuant to a certificate of designations adopted by the Board of
Directors or a duly authorized committee thereof. The description of Preferred
Stock set forth below and the description of the terms of a particular series of
Offered Preferred Stock that will be set forth in a Prospectus Supplement do not
purport to be complete and are qualified in their entirety by reference to the
certificate of designations relating to such series.
The Offered Preferred Stock shall rank in preference to the Common Stock as
to payment of dividends and as to distribution of assets of Enron upon the
liquidation, dissolution or winding up of Enron. Upon issuance against full
payment of the purchase price therefor, shares of Offered Preferred Stock will
be fully paid and nonassessable.
Enron is authorized to issue up to 16,500,000 shares of Preferred Stock. An
aggregate of 1,370,000 shares of Enron Preferred Stock are designated the
Cumulative Second Preferred Convertible Stock ("Enron Convertible Preferred
Stock"), and an aggregate of 35.568509 shares of Enron Preferred Stock are
designated the 9.142% Perpetual Second Preferred Stock ("Enron 9.142% Preferred
Stock").
In addition to the Enron Convertible Preferred Stock and the Enron 9.142%
Preferred Stock, the Enron Board of Directors has authority, without shareholder
approval (except to the extent that holders of
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any series of Enron Preferred Stock are entitled by their terms to class voting
rights), to issue shares of Enron Preferred Stock in one or more series and to
determine the number of shares, designations, dividend rights, conversion
rights, voting power, redemption rights, liquidation preferences and other terms
of any such series. The issuance of Enron Preferred Stock, while providing
desired flexibility in connection with possible acquisitions and other corporate
purposes, could adversely affect the voting power of holders of Enron Common
Stock and the likelihood that such holders will receive dividend payments and
payments upon liquidation and could have the effect of delaying, deferring or
preventing a change in control of Enron.
ENRON CONVERTIBLE PREFERRED STOCK
The following summary of the terms of the Enron Convertible Preferred Stock
is qualified in its entirety by reference to the form of series designation for
the Enron Convertible Preferred Stock filed as an exhibit to this registration
statement.
The annual rate of dividends payable on shares of the Enron Convertible
Preferred Stock is the greater of $10.50 per share or the dividend amount
payable on the number of shares of Enron Common Stock into which one share of
Enron Convertible Preferred Stock are convertible (currently 13.652 shares,
subject to adjustment). Such dividends are payable quarterly on the first days
of January, April, July and October. These dividend rights are superior to the
dividend rights of the Enron Common Stock and rank equally with the dividend
rights on the Enron 9.142% Preferred Stock.
The amount payable on shares of the Enron Convertible Preferred Stock in
the event of any involuntary or voluntary liquidation, dissolution or winding up
of the affairs of Enron is $100 per share, together with accrued dividends to
the date of distribution or payment. The liquidation rights of the Enron
Convertible Preferred Stock are superior to the Enron Common Stock and rank
equally with the liquidation rights of the Enron 9.142% Preferred Stock. The
Enron Convertible Preferred Stock is redeemable at the option of Enron at any
time, in whole or in part, at a redemption price of $100 per share, together
with accrued dividends to the date of distribution or payment. Each share of
Enron Convertible Preferred Stock is convertible initially into 13.652 shares of
Enron Common Stock at any time at the option of the holder (which conversion
rate is and will be subject to certain adjustments).
Holders of Enron Convertible Preferred Stock are entitled to vote together
with the Enron Common Stock on all matters submitted to a vote of Enron
shareholders, with each share of Enron Convertible Preferred Stock having a
number of votes equal to the number of shares of Enron Common Stock into which
one share of Enron Convertible Preferred Stock is convertible. In addition,
holders of Enron Convertible Preferred Stock are entitled to certain class
voting rights, including (unless provision is made for redemption of such
shares) (a) the requirement for approval by the holders of at least two-thirds
of the Enron Convertible Preferred Stock (voting together with all other shares
of parity stock similarly affected) to effect (i) an amendment to the Enron
Charter or Bylaws that would affect adversely the voting powers, rights or
preferences of the holders of the Enron Convertible Preferred Stock or reduces
the time for any notice to which the holders of the Enron Convertible Preferred
Stock may be entitled, (ii) the authorization, creation or issuance of, or the
increase in the authorized amount of, any stock of any class or series or any
security convertible into stock of any class or series ranking prior to the
Enron Convertible Preferred Stock, (iii) the voluntary dissolution, liquidation
or winding up of the affairs of Enron, or the sale, lease or conveyance by Enron
of all or substantially all of its property or assets, or (iv) the purchase or
redemption (for sinking fund purposes or otherwise) of less than all of the
Enron Convertible Preferred Stock and other parity stock at the time outstanding
unless the full dividends on all shares of Enron Convertible Preferred Stock
then outstanding shall have been paid or declared and a sum sufficient for
payment thereof set apart, and (b) the requirement for approval by the holders
of at least a majority of the Enron Convertible Preferred Stock (voting together
with all other shares of parity stock similarly affected), to effect (i) the
authorization, creation or issuance of, or the increase in the authorized amount
of, any stock of any class or series or any security convertible into stock of
any class or series, ranking on a parity with the Enron Convertible Preferred
Stock, provided that no such consent shall be required for the authorization,
creation or issuance by Enron of a number of shares of one or more
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series of Preferred Stock ranking on parity with the Enron Convertible Preferred
Stock that, together with number of shares of Enron Convertible Preferred Stock
and other Preferred Stock ranking on parity with the Enron Convertible Preferred
Stock then outstanding, would equal 5,000,000, or (ii) the merger or
consolidation of Enron with or into any other corporation, unless the
corporation resulting from such merger or consolidation will have after such
merger or consolidation no class of stock and no other securities either
authorized or outstanding ranking prior to or on a parity with the Enron
Convertible Preferred Stock, except the same number of shares of stock and the
same amount of other securities with the same rights and preferences as the
stock and securities of Enron respectively authorized and outstanding
immediately preceding such merger or consolidation, and each holder of Enron
Convertible Preferred Stock immediately preceding such merger or consolidation
shall receive the same number of shares, with the same rights and preferences,
of the resulting corporation. In addition, if dividend payments on the Enron
Convertible Preferred Stock are in default in an amount equivalent to six
quarterly dividends on such shares, then the holders of the Enron Convertible
Preferred Stock (together with holders of any parity stock similarly affected)
shall have certain voting rights to elect two directors to Enron's Board of
Directors until such dividends have been paid or funds sufficient therefor
deposited in trust.
9.142% PREFERRED STOCK
The following summary of the terms of the Enron 9.142% Preferred Stock is
qualified in its entirety by reference to the form of series designation for the
Enron 9.142% Preferred Stock included as an exhibit to this registration
statement.
The annual rate of dividends payable on shares of the Enron 9.142%
Preferred Stock is $91,420 per share. Such dividends are payable quarterly on
the first days of January, April, July and October. These dividend rights are
superior to the dividend rights of the Enron Common Stock and rank equally with
the dividend rights on the Enron Convertible Preferred Stock.
The amount payable on shares of the Enron 9.142% Preferred Stock in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the affairs of Enron is $1,000,000 per share, together with accrued dividends.
The liquidation rights of the Enron 9.142% Preferred Stock are superior to the
Enron Common Stock and rank equally with the liquidation rights of the Enron
Convertible Preferred Stock.
The Enron 9.142% Preferred Stock is not redeemable at the option of Enron.
Pursuant to an agreement between Enron and its subsidiary, however, such
subsidiary will have the rights, exercisable at any time, in whole or in part,
for a 180-day period commencing January 31, 2004, to cause Enron to redeem 18
shares for $1,000,000 per share, together with accrued dividends.
The holders of Enron 9.142% Preferred Stock generally have no voting rights
but are entitled to certain class voting rights, including (unless provision is
made for redemption of such shares) (a) the requirement for approval by the
holders of at least two-thirds of the Enron 9.142% Preferred Stock (voting
together with the holders of all other shares of parity stock similarly
affected), to effect (i) an amendment to the Enron Charter or Bylaws that would
affect adversely the voting powers, rights or preferences of the holders of the
Enron 9.142% Preferred Stock or would reduce the time for any notice to which
the holders of the Enron 9.142% Preferred Stock may be entitled, (ii) the
authorization, creation or issuance of, or the increase in the authorized amount
of, any stock of any class or series or any security convertible into stock of
any class or series ranking prior to the Enron 9.142% Preferred Stock, (iii) the
voluntary dissolution, liquidation or winding up of the affairs of Enron, or the
sale, lease or conveyance by Enron of all or substantially all of its property
or assets, or (iv) the purchase or redemption (for sinking fund purposes or
otherwise) of less than all of the Enron 9.142% Preferred Stock and other parity
stock at the time outstanding unless the full dividends on all shares of Enron
9.142% Preferred Stock then outstanding shall have been paid or declared and a
sum sufficient for payment thereof set apart, and (b) the requirement for
approval by the holders of at least a majority of the Enron 9.142% Preferred
Stock (voting together with all other shares of parity stock similarly
affected), to effect (i) the
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authorization, creation or issuance of, or the increase in the authorized amount
of, any stock of any class or series or any security convertible into stock of
any class or series, ranking on a parity with the Enron 9.142% Preferred Stock,
provided that no such consent shall be required for the authorization, creation
or issuance by Enron of a number of shares of one or more series of Preferred
Stock ranking on parity with the Enron 9.142% Preferred Stock that, together
with number of shares of Enron 9.142% Preferred Stock and other Preferred Stock
ranking on parity with the Enron 9.142% Preferred Stock then outstanding, would
equal 5,000,000, or (ii) the merger or consolidation of Enron with or into any
other corporation, unless the corporation resulting from such merger or
consolidation will have after such merger or consolidation no class of stock and
no other securities either authorized or outstanding ranking prior to or on a
parity with the Enron 9.142% Preferred Stock, except the same number of shares
of stock and the same amount of other securities with the same rights and
preferences as the stock and securities of Enron respectively authorized and
outstanding immediately preceding such merger or consolidation, and each holder
of Enron 9.142% Preferred Stock immediately preceding such merger or
consolidation shall receive the same number of shares, with the same rights and
preferences, of the resulting corporation. In addition, if dividend payments on
the Enron 9.142% Preferred Stock are in default in an amount equivalent to six
quarterly dividends on such shares, then the holders of the Enron 9.142%
Preferred Stock (together with holders of any other parity stock similarly
affected) shall have certain voting rights to elect two directors to Enron's
Board of Directors until such dividends have been paid or funds sufficient
therefor deposited in trust.
CERTAIN PROVISIONS OF THE ENRON CHARTER AND BYLAWS
Fair Price Provision. The Enron Charter contains a "fair price" provision
which generally requires that certain mergers, business combinations and similar
transactions with a "Related Person" (generally the beneficial owner of at least
10 percent of Enron's voting stock) be approved by the holders of at least 80
percent of Enron's voting stock, unless (a) the transaction is approved by at
least 80 percent of the "Continuing Directors" of Enron, who constitute a
majority of the entire board, (b) the transaction occurs more than five years
after the last acquisition of Enron voting stock by the Related Person or (c)
certain "fair price" and procedural requirements are satisfied.
The Enron Charter defines "Business Transaction" as (a) any merger or
consolidation involving Enron or a subsidiary of Enron, (b) any sale, lease,
exchange, transfer or other disposition (in one transaction or a series of
transactions), including without limitation a mortgage or any other security
device, of all or any substantial part of the assets either of Enron or of a
subsidiary of Enron, (c) any sale, lease, exchange, transfer or other
disposition of all or any substantial part of the assets of an entity to Enron
or a subsidiary of Enron, (d) the issuance, sale, exchange, transfer or other
disposition by Enron or a subsidiary of Enron of any securities of Enron or any
subsidiary of Enron, (e) any recapitalization or reclassification of Enron's
securities (including without limitation, any reverse stock split) or other
transaction that would have the effect of increasing the voting power of a
Related Person, (f) any liquidation, spinoff, splitoff, splitup or dissolution
of Enron, and (g) any agreement, contract or other arrangement providing for any
of the transactions described in this definition of Business Transaction.
"Continuing Director" is defined to mean a director who either was a member of
the Board of Directors of Enron prior to the time such Related Person became a
Related Person or who subsequently became a director of Enron and whose
election, or nomination for election by Enron's shareholders, was approved by a
vote of at least 80 percent of the Continuing Directors then on the Board,
either by a specific vote or by approval of the proxy statement issued by Enron
on behalf of the Board of Directors in which such person is named as nominee for
director, without an objection to such nomination; provided, however, that in no
event shall a director be considered a "Continuing Director" if such director is
a Related Person and the Business Transaction to be voted upon is with such
Related Person or is one in which such Related Person otherwise has an interest
(except proportionately as a shareholder of Enron).
Advance Notice Requirements for Shareholder Proposals and Nominations. The
Enron Bylaws provide that for business to be properly brought before an annual
meeting of shareholders, it must be either (a) specified in the notice of
meeting (or any supplement thereto) given by or at the direction of
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the Board of Directors, (b) otherwise brought before the meeting by or at the
direction of the Board of Directors or (c) otherwise properly brought before the
meeting by a shareholder of Enron who is a shareholder of record at the time of
giving of notice hereinafter provided for, who shall be entitled to vote at such
meeting and who complies with the following notice procedures. In addition to
any other applicable requirements, for business to be brought before an annual
meeting by a shareholder of Enron, the shareholder must have given to the
Secretary of Enron timely notice in writing of the business to be brought before
an annual meeting of shareholders. To be timely, a shareholder's notice must be
delivered to or mailed and received at Enron's principal executive offices not
less than 120 days prior to the anniversary date of the proxy statement for the
previous year's annual meeting of the shareholders of Enron (or Old Enron, with
respect to the first such meeting after the Effective Time). A shareholder's
notice to the Secretary must set forth as to each matter the shareholder
proposes to bring before the annual meeting (i) a brief description of the
business desired to be brought before the annual meeting and the reasons for
conducting such business at the annual meeting, (ii) the name and address, as
they appear on Enron's books, of the shareholder proposing such business, (iii)
the acquisition date, the class and the number of shares of voting stock of
Enron which are owned beneficially by the shareholder, (iv) any material
interest of the shareholder in such business and (v) a representation that the
shareholder intends to appear in person or by proxy at the meeting to bring the
proposed business before the meeting. No business shall be conducted at an
annual meeting except in accordance with the procedures outlined above.
The Enron Bylaws provide that only persons who are nominated for election
as a director of Enron in accordance with the following procedures shall be
eligible for election as directors. Nominations of persons for election to
Enron's Board of Directors may be made at a meeting of shareholders (a) by or at
the direction of the Board of Directors or (b) by any shareholder of Enron who
is a shareholder of record at the time of giving of notice hereinafter provided
for, who shall be entitled to vote for the election of directors at the meeting
and who complies with the following notice procedures. Such nominations, other
than those made by or at the direction of the Board of Directors, shall be made
pursuant to timely notice in writing to the Secretary of Enron. To be timely, a
shareholder's notice must be delivered to or mailed and received at Enron's
principal executive offices, (i) with respect to an election to be held at an
annual meeting of shareholders of Enron, not less than 120 days prior to the
anniversary date of the proxy statement for the previous year's annual meeting
of the shareholders of Enron (or Old Enron, with respect to the first such
meeting after the Effective Time), and (ii) with respect to an election to be
held at a special meeting of shareholders of Enron for the election of
directors, not later than the close of business on the 10th day following the
date on which notice of the date of the meeting was mailed or public disclosure
of the date of the meeting was made, whichever first occurs. Such shareholder's
notice to the Secretary shall set forth (a) as to each person whom the
shareholder proposes to nominate for election or re-election as a director, all
information relating to the person that is required to be disclosed in
solicitations for proxies for election of directors, or is otherwise required,
pursuant to Regulation 14A under the Exchange Act (including the written consent
of such person to be named in the proxy statement as a nominee and to serve as a
director if elected); and (b) as to the shareholder giving the notice, (i) the
name and address, as they appear on Enron's books, of such shareholder, and (ii)
the class and number of shares of capital stock of Enron which are beneficially
owned by the shareholder.
CERTAIN ANTI-TAKEOVER PROVISIONS OF OREGON LAW.
Business Combinations with Interested Shareholders. Enron is subject to the
provisions of Sections 60.825-60.845 of the Oregon Business Corporation Act
("OBCA"), which generally provide that any person who acquires 15% or more of a
corporation's voting stock (thereby becoming an "interested shareholder") may
not engage in certain "business combinations" with the corporation for a period
of three years following the date the person became an interested stockholder,
unless (i) the board of directors has approved, prior to the date the person
became an interested shareholder, either the business combination or the
transaction that resulted in the person becoming an interested shareholder, (ii)
upon consummation of the transaction that resulted in the person becoming an
interested shareholder, that person owns at least 85% of the corporation's
voting stock outstanding at the time the
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transaction is commenced (excluding shares owned by persons who are both
directors and officers and shares owned by employee stock plans in which
participants do not have the right to determine whether shares will be tendered
in a tender or exchange offer), or (iii) on or subsequent to the date the person
became an interested shareholder, the business combination is approved by the
board of directors and authorized by the affirmative vote of at least 66 2/3% of
the outstanding voting stock not owned by the interested shareholder.
Control Share Statute. As is permitted by the OBCA, the Enron Charter
provides that Enron is not subject to the Oregon Control Share Act. The Oregon
Control Share Act restricts the ability of a shareholder of certain Oregon-based
corporations to vote shares of stock acquired in a transaction that causes the
acquiring person to control at least one-fifth, one-third or one-half of the
votes entitled to be cast in the election of directors, except as authorized by
a vote of the corporation's disinterested shareholders.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
Enron may, at its option, elect to offer fractional interests in the
Offered Preferred Stock. In the event such option is exercised, Enron will offer
depositary shares ("Depositary Shares"), each of which will represent a fraction
(to be set forth in the Prospectus Supplement relating to a particular series of
Offered Preferred Stock) of a share of a particular series of Offered Preferred
Stock as described below.
The Offered Preferred Stock of any series represented by Depositary Shares
will be deposited under a deposit agreement (the "Deposit Agreement") between
Enron and a bank or trust company selected by Enron having its principal office
in the United States and having, alone or together with its affiliates, a
combined capital and surplus of at least $50,000,000 (the "Depositary"). Subject
to the terms of the Deposit Agreement, each registered holder of a Depositary
Share will be entitled, in proportion to the applicable fraction of a share of
Offered Preferred Stock represented by such Depositary Share, to all the rights
and preferences of the Offered Preferred Stock represented thereby (including
dividend, voting, redemption and liquidation rights).
The Depositary Shares will be evidenced by depositary receipts ("Depositary
Receipts") issued pursuant to the Deposit Agreement. Depositary Receipts will be
distributed to those persons purchasing the fractional interests in Offered
Preferred Stock in accordance with the terms of the offering set forth in the
applicable Prospectus Supplement. A copy of the form of Deposit Agreement is
filed as an exhibit to the Registration Statements of which this Prospectus is a
part, and the following summary is qualified in its entirety by reference to
such exhibit.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all dividends or other cash distributions
received in respect of the Offered Preferred Stock to the record holders of
Depositary Shares relating to such Offered Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders.
In the event of a distribution other than in cash or rights, preferences or
privileges upon the Offered Preferred Stock, the Depositary will distribute
property received by it to the record holders of Depositary Shares entitled
thereto in proportion to the number of such Depositary Shares owned by such
holders, unless the Depositary determines that such distribution cannot be made
proportionately among such holders or that it is not feasible to make such
distribution, in which case the Depositary may, with the approval of Enron, sell
such securities or property and distribute the net proceeds from such sale to
such holders or adopt such other method as it deems equitable and practicable
for effecting such distribution.
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WITHDRAWAL OF THE OFFERED PREFERRED STOCK
Upon surrender of the Depositary Receipts at the corporate trust office of
the Depositary (unless the related Offered Preferred Stock or Depositary Shares
have previously been called for redemption), and upon payment of the charges
provided in the Deposit Agreement and subject to the terms thereof, the holder
of the Depositary Shares evidenced thereby is entitled to delivery at such
office to or upon his order the number of whole shares of Offered Preferred
Stock and any money or other property represented by such Depositary Shares. If
the Depositary Receipts delivered by the holder evidence a number of Depositary
Shares in excess of the number of Depositary Shares representing the number of
whole shares of Offered Preferred Stock to be withdrawn, the Depositary will
deliver to such holder at the same time a new Depositary Receipt evidencing such
excess number of Depositary Shares. Holders of Offered Preferred Stock thus
withdrawn, and any subsequent holders of those shares, will not thereafter be
entitled to deposit such shares under the Deposit Agreement or to receive
Depositary Shares therefor.
REDEMPTION OF DEPOSITARY SHARES
Upon redemption of Offered Preferred Stock represented by Depositary
Shares, the Depositary will redeem as of the same redemption date the number of
Depositary Shares representing Offered Preferred Stock so redeemed, provided
Enron shall have paid in full to the Depositary the redemption price of the
Offered Preferred Stock to be redeemed (which redemption price shall include an
amount equal to any accrued and unpaid dividends thereon to the date fixed for
redemption). The redemption price per Depositary Share will be equal to the
applicable fraction of the redemption price and any other amounts per share
payable with respect to the Offered Preferred Stock. If fewer than all the
Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will
be selected by the Depositary by lot or pro rata or by any other equitable
method, in each case as may be determined by Enron.
VOTING OF THE OFFERED PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the Offered
Preferred Stock are entitled to vote, the Depositary will mail the information
contained in such notice of meeting to the record holders of the Depositary
Shares. Each record holder of such Depositary Shares on the record date (which
will be the same date as the record date for the Offered Preferred Stock) will
be entitled to instruct the Depositary as to the exercise of the voting rights
pertaining to the amount of Offered Preferred Stock represented by such holder's
Depositary Shares. The Depositary will endeavor, insofar as practicable, to vote
the number of shares of Offered Preferred Stock represented by such Depositary
Shares in accordance with such instructions, and Enron will agree to take all
reasonable action which may be deemed necessary by the Depositary in order to
enable the Depositary to do so. The Depositary will abstain from voting Offered
Preferred Stock (but, at its discretion, not from appearing at any meeting with
respect to such Offered Preferred Stock) to the extent it does not receive
specific instructions from the holders of Depositary Shares representing Offered
Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between Enron and the Depositary. However, any amendment which materially and
adversely alters the rights of the holders of Depositary Shares will not be
effective unless such amendment has been approved by the holders of at least a
majority of the Depositary Shares then outstanding.
The Deposit Agreement may be terminated by Enron upon not less than 60
days' notice, whereupon the Depositary shall deliver or make available to each
holder of Depositary Receipts, upon surrender of the Depositary Receipts held by
such holder, such number of whole or fractional shares of Offered Preferred
Stock represented by such Depositary Receipts. The Deposit Agreement will
automatically terminate if (i) all outstanding Depositary Shares have been
redeemed, or (ii) there has been a final
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distribution in respect of the Offered Preferred Stock in connection with any
liquidation, dissolution or winding up of Enron and such distribution has been
made to the holders of Depositary Receipts.
CHARGES OF DEPOSITARY
Enron will pay all transfer and other taxes and governmental charges
arising solely from the existence of the Depositary arrangements. Enron will pay
the fees and expenses of the Depositary in connection with the performance of
its duties under the Deposit Agreement, to the extent specified in the Deposit
Agreement. Holders of Depositary Receipts will pay transfer and other taxes and
governmental charges.
MISCELLANEOUS
Enron will forward to holders of Depositary Shares any reports and
communications that it sends to holders of Offered Preferred Stock.
Neither the Depositary nor Enron will be liable if it is prevented from or
delayed in, by law or any circumstances beyond its control, performing its
obligations under the Deposit Agreement. The obligations of Enron and the
Depositary under the Deposit Agreement will be limited to performing their
duties thereunder without negligence or willful misconduct, and Enron and the
Depositary will not be obligated to prosecute or defend any legal proceeding in
respect of any Depositary Shares or any Offered Preferred Stock unless
satisfactory indemnity is furnished. Enron and the Depositary may rely on advice
of counsel or accountants, on information provided by holders of Depositary
Shares or other persons believed to be authorized or competent and on documents
believed to be genuine.
In the event the Depositary shall receive conflicting claims, requests or
instructions from any holders of Depositary Receipts, on the one hand, and
Enron, on the other hand, the Depositary shall be entitled to act on such
claims, requests or instructions received from Enron.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to Enron notice of its
election to do so, and Enron may at any time remove the Depositary, any such
resignation or removal to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment. Such successor Depositary
must be appointed within 60 days after delivery of the notice of resignation or
removal and must be a bank or trust company having its principal office in the
United States and having, alone or together with its affiliates, a combined
capital and surplus of at least $50,000,000.
DESCRIPTION OF WARRANTS TO PURCHASE COMMON STOCK
The following statements with respect to the Stock Warrants are summaries
of, and subject to, the detailed provisions of a warrant agreement ("Stock
Warrant Agreement") to be entered into by Enron and a warrant agent to be
selected at the time of issue (the "Stock Warrant Agent"), and having the terms
described in the Prospectus Supplement relating thereto.
GENERAL
The Stock Warrants, evidenced by warrant certificates (the "Stock Warrant
Certificates"), may be issued under the Stock Warrant Agreement independently or
together with any Offered Securities and may be attached to or separate from
such Offered Securities. If Stock Warrants are offered, the Prospectus
Supplement will describe the terms of the warrants, including the following: (1)
the offering price, if any; (2) the number of shares of Common Stock purchasable
upon exercise of one Stock Warrant and the initial price at which such shares
may be purchased upon exercise; (3) the date on which the right to exercise the
Stock Warrants shall commence and the date on which such right shall expire; and
(4) any other terms of the Stock Warrants. The shares of Common Stock issuable
upon
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exercise of the Stock Warrants will, when issued in accordance with the Stock
Warrant Agreement, be fully paid and nonassessable.
EXERCISE OF STOCK WARRANTS
Stock Warrants may be exercised by surrendering to the Stock Warrant Agent
the Stock Warrant Certificate signed by the warrantholder, or his duly
authorized agent, indicating the warrantholder's election to exercise all or a
portion of the Stock Warrants evidenced by the certificate. Surrendered Stock
Warrant Certificates shall be accompanied by payment of the aggregate exercise
price of the Stock Warrants to be exercised, as set forth in the Prospectus
Supplement, which payment may be made in the form of cash or a check equal to
the exercise price. Certificates evidencing duly exercised Stock Warrants shall
be delivered by the Stock Warrant Agent to the transfer agent for the Common
Stock. Upon receipt thereof, the transfer agent shall deliver or cause to be
delivered, to or upon the written order of the exercising warrantholder, a
certificate representing the number of shares of Common Stock purchased. If
fewer than all of the Stock Warrants evidenced by any certificate are exercised,
the Stock Warrant Agent shall deliver to the exercising warrantholder a new
Stock Warrant Certificate representing the unexercised Stock Warrants.
ANTIDILUTION PROVISIONS
The exercise price payable and the number of shares of Common Stock
purchasable upon the exercise of each Stock Warrant will be subject to
adjustment in certain events, including (1) the issuance of a stock dividend to
holders of Common Stock or a combination, subdivision or reclassification of
Common Stock; (2) the issuance of rights, warrants or options to all holders of
Enron's Common Stock entitling the holders thereof to purchase Common Stock for
an aggregate consideration per share less than the current market price per
share of Common Stock; or (3) any distribution by Enron to the holders of its
Common Stock of evidences of indebtedness of Enron or of assets (excluding cash
dividends or distributions payable out of consolidated earnings and earned
surplus and dividends or distributions referred to in (1) above). In lieu of
adjusting the number of shares of Common Stock purchasable upon exercise of each
Stock Warrant, Enron may elect to adjust the number of Stock Warrants. No
adjustment in the number of shares purchasable upon exercise of the Stock
Warrants will be required until cumulative adjustments require an adjustment of
at least 1% thereof. Enron may, at its option, reduce the exercise price at any
time. No fractional shares will be issued upon exercise of Stock Warrants, but
Enron will pay the cash value of any fractional shares otherwise issuable.
Notwithstanding the foregoing, in case of any consolidation, merger or sale or
conveyance of the property of Enron as an entirety or substantially as an
entirety, the holder of each outstanding Stock Warrant upon exercise thereof
shall have the right to the kind and amount of shares of stock and other
securities and property (including cash) receivable by a holder of the number of
shares of Common Stock for which such Stock Warrant was exercisable immediately
prior thereto.
NO RIGHTS AS STOCKHOLDERS
Holders of Stock Warrants will not be entitled, by virtue of being such
holders, to vote, to consent, to receive dividends, to receive notice as
stockholders with respect to any meeting of stockholders for the election of
directors of Enron or any other matter or to exercise any rights whatsoever as
stockholders of Enron.
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PLAN OF DISTRIBUTION
Enron may sell the Offered Securities (i) through underwriters or dealers;
(ii) directly to purchasers; or (iii) through agents. The Prospectus Supplement
with respect to the Offered Securities will set forth the terms of the offering
of the Offered Securities, including the name or names of any underwriters or
agents, if required, the purchase price of the Offered Securities and the
proceeds to Enron from such sale, any delayed delivery arrangements, any
underwriting discounts and commissions and other items constituting
underwriters' compensation, any initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers. Any initial public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
In connection with the sale of the Offered Securities, underwriters, brokers,
dealers or agents may be deemed to have received compensation from Enron in the
form of underwriting discounts or commissions and may also receive commissions
from purchasers of the Offered Securities for whom they may act as agent or to
whom they may sell as principal. Underwriters or agents may sell the Offered
Securities to or through dealers, and such dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters or
commissions from the purchasers for whom they may act as agent. The Offered
Securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. The underwriter or underwriters with respect to a
particular underwritten offering of Offered Securities will be named in the
Prospectus Supplement relating to such offering and, if an underwriting
syndicate is used, the managing underwriter or underwriters will be set forth on
the cover of such Prospectus Supplement. Unless otherwise set forth in the
Prospectus Supplement relating thereto, the obligations of the underwriters to
purchase the Offered Securities will be subject to certain conditions precedent,
and the underwriters will be obligated to purchase all the Offered Securities if
any are purchased.
If dealers are utilized in the sale of Offered Securities, Enron will sell
such Offered Securities to the dealers as principals. The dealers may then
resell such Offered Securities to the public at varying prices to be determined
by such dealers at the time of resale. To the extent required, the names of
dealers or brokers acting as dealers and the terms of the transaction will be
set forth in the Prospectus Supplement relating thereto.
The Offered Securities may be sold directly by Enron or through agents
designated by Enron from time to time. Any agent acting as an underwriter in the
offer or sale of the Offered Securities in respect to which this Prospectus is
delivered will be named, and any commissions payable by Enron to such agent will
be set forth, in the Prospectus Supplement relating thereto. Unless otherwise
indicated in the Prospectus Supplement, any such agent will be acting on a best
efforts basis for the period of its appointment.
If so indicated in the Prospectus Supplement, Enron will authorize agents,
underwriters or dealers to solicit offers from certain types of institutions to
purchase Offered Securities from Enron at the public offering price set forth in
the Prospectus Supplement pursuant to delayed delivery contracts providing for
payment and delivery on a specified date in the future. Such contracts will be
subject only to those conditions set forth in the Prospectus Supplement, and the
Prospectus Supplement will set forth the commission payable for solicitation of
such contracts.
The Offered Securities (other than the Common Stock), when first issued,
will have no established trading market. Any underwriters or agents to or
through whom Offered Securities are sold for public offering and sale may make a
market in such Offered Securities, but such underwriters or agents will not be
obligated to do so and may discontinue any market making at any time without
notice. No assurance can be given as to the liquidity of the trading market for
any such Offered Securities.
23
<PAGE> 26
Agents, dealers and underwriters may be entitled under agreements with
Enron to indemnification by Enron against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments which such agents, dealers or underwriters may be required to make in
respect thereof. Agents, dealers and underwriters may be customers of, engage in
transactions with or perform services for Enron in the ordinary course of
business.
The Offered Securities may or may not be listed on a national securities
exchange. No assurances can be given that there will be a market for the Offered
Securities.
VALIDITY OF SECURITIES
The validity of the Offered Securities will be passed upon for Enron by
James V. Derrick, Jr., Esq., Senior Vice President and General Counsel of Enron.
Mr. Derrick owns substantially less than 1% of the outstanding shares of Common
Stock of Enron.
EXPERTS
The consolidated financial statements included in Enron's Current Report on
Form 8-K dated March 17, 1997 and consolidated financial statements and schedule
included in Enron's Annual Report on Form 10-K for the year ended December 31,
1996, incorporated by reference in this prospectus and elsewhere in the
registration statement, have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and are
incorporated by reference herein in reliance upon the authority of said firm as
experts in giving said reports.
The letter report of DeGolyer and MacNaughton, independent petroleum
consultants, included as an exhibit to Enron's Annual Report on Form 10-K for
the year ended December 31, 1996, and the estimates from the reports of that
firm appearing in such Annual Report, are incorporated by reference herein on
the authority of said firm as experts in petroleum engineering and in giving
such reports.
24
<PAGE> 27
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth those expenses to be incurred by Enron in
connection with the issuance and distribution of the securities being
registered. Except for the Securities and Exchange Commission registration fee,
all amounts shown are estimates.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee......... $303,031
Accounting Fees and Expenses................................ 20,000
Legal Fees and Expenses..................................... 50,000
Fees and Expenses of Transfer Agent, Trustee and
Depositary................................................ 15,000
Blue Sky Fees and Expenses, Including Counsel Fees.......... 25,000
Listing Fees................................................ 20,000
Printing and Engraving Expenses............................. 150,000
Miscellaneous............................................... 16,969
--------
Total............................................. $600,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS
The Enron Charter contains provisions under which Enron will indemnify, to
the fullest extent permitted by law, persons who are made a party to an action
or proceeding by virtue of the fact that the individual is or was a director,
officer, or, in certain circumstances, an employee or agent, of Enron or another
corporation at Enron's request. The Oregon Business Corporation Act generally
permits such indemnification to the extent that the individual acted in good
faith and in a manner which he reasonably believed to be in the best interest of
or not opposed to the corporation or, with respect to criminal matters, if the
individual had no reasonable cause to believe his or her conduct was unlawful.
In addition, the Enron Charter contains a provision that eliminates the personal
liability of a director to the corporation or its shareholders for monetary
damages for conduct as a director, except for liability of a director (i) for
breach of the duty of loyalty, (ii) for actions or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii) for
the payment of improper dividends or redemptions, or (iv) for any transaction
from which the director derived an improper personal benefit.
The Form of Underwriting Agreement filed as Exhibit 1 hereto, under certain
specified circumstances, provides for indemnification by the Underwriters of the
directors, officers and controlling persons of Enron.
Enron has purchased liability insurance policies covering the directors and
officers of Enron to provide protection where Enron cannot legally indemnify a
director or officer and where a claim arises under the Employee Retirement
Income Security Act of 1974 against a director or officer based on an alleged
breach of fiduciary duty or other wrongful act.
ITEM 16. EXHIBITS
<TABLE>
<S> <C>
1.01 -- Form of Underwriting Agreement -- Debt Securities.
1.02 -- Form of Underwriting Agreement -- Equity Securities.
1.03 -- Enron Corp. Underwriting Agreement Standard Provisions,
dated as of September 15, 1997.
</TABLE>
II-1
<PAGE> 28
<TABLE>
<S> <C>
*2 -- Amended and Restated Agreement and Plan of Merger dated as
of July 20, 1996 and amended and restated as of September
24, 1996 among Enron, Enron Oregon Corp. and PGC, as amended
by the First Amendment thereto dated April 14, 1997 (Annex A
to the Proxy Statement/Prospectus included in Enron's
Registration Statement on Form S-4 -- File No. 333-13791).
*3.01 -- Amended and Restated Articles of Incorporation of Enron
(Annex E to the Proxy Statement/Prospectus included in
Enron's Registration Statement on Form S-4 -- File No.
333-13791).
*3.02 -- Articles of Merger of Enron Oregon Corp., an Oregon
Corporation, and Enron Corp., a Delaware Corporation
(Exhibit 3.02 to Post-Effective Amendment No. 1 to Enron's
Registration Statement on Form S-3 - File No. 33-60417).
*3.03 -- Articles of Merger of Enron Corp., an Oregon Corporation,
and Portland General Corporation, an Oregon Corporation
(Exhibit 3.03 to Post-Effective Amendment No. 1 to Enron's
Registration Statement on Form S-3 - File No. 33-60417).
*3.04 -- Bylaws of Enron (Exhibit 3.04 to Post-Effective Amendment
No. 1 to Enron's Registration Statement on Form S-3 - File
No. 33-60417).
*3.05 -- Form of Series Designation for the Enron Convertible
Preferred Stock (Annex F to the Proxy Statement/Prospectus
included in Enron's Registration Statement on Form
S-4 -- File No. 333-13791).
*3.06 -- Form of Series Designation for the Enron 9.142% Preferred
Stock (Annex G to the Proxy Statement/Prospectus included in
Enron's Registration Statement on Form S-4 -- File No.
333-13791).
*4.01 -- Indenture dated as of November 1, 1985, between Old Enron
and Harris Trust and Savings Bank, as supplemented and as
amended by the First Supplemental Indenture dated as of
December 1, 1995 (Form T-3 Application for Qualification of
Indentures under the Trust Indenture Act of 1939, File No.
22-14390, filed October 24, 1985; Exhibit 4(b) to Old
Enron's Form S-3 Registration Statement No. 33-64057 filed
on November 8, 1995). There have not been filed as exhibits
to this registration statement other debt instruments
defining the rights of holders of long-term debt of Enron,
none of which relates to authorized indebtedness that
exceeds 10% of the consolidated assets of Enron and its
subsidiaries. Enron hereby agrees to furnish a copy of any
such instrument to the Commission upon request.
*4.02 -- Supplemental Indenture, dated as of May 8, 1997, by and
among Enron Corp., Enron Oregon Corp. and Harris Trust and
Savings Bank, as Trustee (Exhibit 4.02 to Post-Effective
Amendment No. 1 to Enron's Registration Statement on Form
S-3 - File No. 33-60417).
4.03 -- Form of Supplemental Indenture, dated as of September 1,
1997, between Enron Corp. and Harris Trust and Savings Bank,
as Trustee.
*4.04 -- Form of Amended and Restated Agreement of Limited
Partnership of Enron Capital Resources, L.P. (Exhibit 3.1 to
Old Enron Form 8-K dated August 2, 1994).
*4.05 -- Form of Payment and Guarantee Agreement dated as of August
3, 1994, executed by Enron Corp. for the benefit of the
holders of Enron Capital Resources, L.P. 9% Cumulative
Preferred Securities, Series A (Exhibit 4.1 to Old Enron
Form 8-K dated August 2, 1994).
</TABLE>
II-2
<PAGE> 29
<TABLE>
<S> <C>
*4.06 -- Form of Loan Agreement, dated as of August 3, 1994, between
Enron Corp. and Enron Capital Resources, L.P. (Exhibit 4.2
to Old Enron Form 8-K dated August 2, 1994).
*4.07 -- Articles of Association of Enron Capital LLC (Exhibit 9 to
Old Enron Form 8-K dated November 12, 1993).
*4.08 -- Form of Payment and Guarantee Agreement of Enron Corp.,
dated as of November 15, 1993, in favor of the holders of
Enron Capital LLC 8% Cumulative Guaranteed Monthly Income
Preferred Shares (Exhibit 2 to Old Enron Form 8-K dated
November 12, 1993).
*4.09 -- Form of Loan Agreement, dated as of November 15, 1993,
between Enron Corp. and Enron Capital LLC (Exhibit 3 to Old
Enron Form 8-K dated November 12, 1993).
*4.10 -- Form of Deposit Agreement between Enron and the Depositary
(Exhibit 4(b) to Old Enron Registration Statement No.
33-50641, filed October 15, 1993).
5 -- Opinion of James V. Derrick, Jr., Esq., Senior Vice
President and General Counsel of Enron, as to validity of
Debt Securities, Preferred Stock, Depositary Shares, Common
Stock and Stock Warrants.
12 -- Computation of Enron's Ratios of Earnings to Fixed Charges
and Preferred Stock Dividends.
23.01 -- Consent of Arthur Andersen LLP.
23.02 -- Consent of DeGolyer and MacNaughton.
23.03 -- The consent of James V. Derrick, Jr., Esq., is contained in
his opinion filed as Exhibit 5 hereto.
24 -- Powers of Attorney.
25 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Harris Trust and Savings Bank.
</TABLE>
- ---------------
* Incorporated by reference as indicated.
ITEM 17. UNDERTAKINGS
The undersigned Registrant, Enron Corp., hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to each Registration Statement:
(i) To include any prospectus required in 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 each 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 Statements;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statements
or any material change to such information in the Registration
Statements;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration Statements;
II-3
<PAGE> 30
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, 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; and
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of Enron's annual report pursuant to
section 13(a) or section 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
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant have been advised 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 such 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, such 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> 31
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, ENRON 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 OR
AMENDMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF HOUSTON AND STATE OF TEXAS, ON THE 12TH DAY OF
SEPTEMBER, 1997.
ENRON CORP.
(Registrant)
By: /s/ RICHARD A. CAUSEY
Richard A. Causey
Senior Vice President and Chief
Accounting and Information Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT OR AMENDMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN
THE CAPACITIES WITH ENRON CORP. INDICATED AND ON THE 12TH DAY OF SEPTEMBER,
1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ KENNETH L. LAY Chairman of the Board, Chief Executive
- --------------------------------------------- Officer and Director (Principal Executive
(Kenneth L. Lay) Officer)
/s/ RICHARD A. CAUSEY Senior Vice President and Chief Accounting
- --------------------------------------------- and Information Officer (Principal
(Richard A. Causey) Accounting Officer)
/s/ ANDREW S. FASTOW Senior Vice President, Finance and Treasurer
- --------------------------------------------- (Principal Financial Officer)
(Andrew S. Fastow)
ROBERT A. BELFER* Director
- ---------------------------------------------
(Robert A. Belfer)
NORMAN P. BLAKE, JR.* Director
- ---------------------------------------------
(Norman P. Blake, Jr.)
JOHN H. DUNCAN* Director
- ---------------------------------------------
(John H. Duncan)
JOE H. FOY* Director
- ---------------------------------------------
(Joe H. Foy)
WENDY L. GRAMM* Director
- ---------------------------------------------
(Wendy L. Gramm)
ROBERT K. JAEDICKE* Director
- ---------------------------------------------
(Robert K. Jaedicke)
CHARLES A. LEMAISTRE* Director
- ---------------------------------------------
(Charles A. LeMaistre)
</TABLE>
II-5
<PAGE> 32
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
JEROME J. MEYER* Director
- ---------------------------------------------
(Jerome J. Meyer)
JEFFREY K. SKILLING* Director and President and
- --------------------------------------------- Chief Operating Officer
(Jeffrey K. Skilling)
JOHN A. URQUHART* Director
- ---------------------------------------------
(John A. Urquhart)
JOHN WAKEHAM* Director
- ---------------------------------------------
(John Wakeham)
CHARLS E. WALKER* Director
- ---------------------------------------------
(Charls E. Walker)
BRUCE G. WILLISON* Director
- ---------------------------------------------
(Bruce G. Willison)
HERBERT S. WINOKUR, JR.* Director
- ---------------------------------------------
(Herbert S. Winokur, Jr.)
Constituting a Majority of the Board of
Directors
*By: /s/ PEGGY B. MENCHACA
- ---------------------------------------------
Peggy B. Menchaca
(Attorney-in-fact for persons indicated)
</TABLE>
II-6
<PAGE> 33
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
<S> <C>
1.01 -- Form of Underwriting Agreement -- Debt Securities.
1.02 -- Form of Underwriting Agreement -- Equity Securities.
1.03 -- Enron Corp. Underwriting Agreement Standard Provisions,
dated as of September 15, 1997.
*2 -- Amended and Restated Agreement and Plan of Merger dated as
of July 20, 1996 and amended and restated as of September
24, 1996 among Enron, Enron Oregon Corp. and PGC, as amended
by the First Amendment thereto dated April 14, 1997 (Annex A
to the Proxy Statement/Prospectus included in Enron's
Registration Statement on Form S-4 -- File No. 333-13791).
*3.01 -- Amended and Restated Articles of Incorporation of Enron
(Annex E to the Proxy Statement/Prospectus included in
Enron's Registration Statement on Form S-4 -- File No.
333-13791).
*3.02 -- Articles of Merger of Enron Oregon Corp., an Oregon
Corporation, and Enron Corp., a Delaware Corporation
(Exhibit 3.02 to Post-Effective Amendment No. 1 to Enron's
Registration Statement on Form S-3 - File No. 33-60417).
*3.03 -- Articles of Merger of Enron Corp., an Oregon Corporation,
and Portland General Corporation, an Oregon Corporation
(Exhibit 3.03 to Post-Effective Amendment No. 1 to Enron's
Registration Statement on Form S-3 - File No. 33-60417).
*3.04 -- Bylaws of Enron (Exhibit 3.04 to Post-Effective Amendment
No. 1 to Enron's Registration Statement on Form S-3 - File
No. 33-60417).
*3.05 -- Form of Series Designation for the Enron Convertible
Preferred Stock (Annex F to the Proxy Statement/Prospectus
included in Enron's Registration Statement on Form
S-4 -- File No. 333-13791).
*3.06 -- Form of Series Designation for the Enron 9.142% Preferred
Stock (Annex G to the Proxy Statement/Prospectus included in
Enron's Registration Statement on Form S-4 -- File No.
333-13791).
*4.01 -- Indenture dated as of November 1, 1985, between Old Enron
and Harris Trust and Savings Bank, as supplemented and as
amended by the First Supplemental Indenture dated as of
December 1, 1995 (Form T-3 Application for Qualification of
Indentures under the Trust Indenture Act of 1939, File No.
22-14390, filed October 24, 1985; Exhibit 4(b) to Old
Enron's Form S-3 Registration Statement No. 33-64057 filed
on November 8, 1995). There have not been filed as exhibits
to this registration statement other debt instruments
defining the rights of holders of long-term debt of Enron,
none of which relates to authorized indebtedness that
exceeds 10% of the consolidated assets of Enron and its
subsidiaries. Enron hereby agrees to furnish a copy of any
such instrument to the Commission upon request.
*4.02 -- Supplemental Indenture, dated as of May 8, 1997, by and
among Enron Corp., Enron Oregon Corp. and Harris Trust and
Savings Bank, as Trustee (Exhibit 4.02 to Post-Effective
Amendment No. 1 to Enron's Registration Statement on Form
S-3 - File No. 33-60417).
4.03 -- Form of Supplemental Indenture, dated as of September 1,
1997, between Enron Corp. and Harris Trust and Savings Bank,
as Trustee.
*4.04 -- Form of Amended and Restated Agreement of Limited
Partnership of Enron Capital Resources, L.P. (Exhibit 3.1 to
Old Enron Form 8-K dated August 2, 1994).
</TABLE>
<PAGE> 34
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
<S> <C>
*4.05 -- Form of Payment and Guarantee Agreement dated as of August
3, 1994, executed by Enron Corp. for the benefit of the
holders of Enron Capital Resources, L.P. 9% Cumulative
Preferred Securities, Series A (Exhibit 4.1 to Old Enron
Form 8-K dated August 2, 1994).
*4.06 -- Form of Loan Agreement, dated as of August 3, 1994, between
Enron Corp. and Enron Capital Resources, L.P. (Exhibit 4.2
to Old Enron Form 8-K dated August 2, 1994).
*4.07 -- Articles of Association of Enron Capital LLC (Exhibit 9 to
Old Enron Form 8-K dated November 12, 1993).
*4.08 -- Form of Payment and Guarantee Agreement of Enron Corp.,
dated as of November 15, 1993, in favor of the holders of
Enron Capital LLC 8% Cumulative Guaranteed Monthly Income
Preferred Shares (Exhibit 2 to Old Enron Form 8-K dated
November 12, 1993).
*4.09 -- Form of Loan Agreement, dated as of November 15, 1993,
between Enron Corp. and Enron Capital LLC (Exhibit 3 to Old
Enron Form 8-K dated November 12, 1993).
*4.10 -- Form of Deposit Agreement between Enron and the Depositary
(Exhibit 4(b) to Old Enron Registration Statement No.
33-50641, filed October 15, 1993).
5 -- Opinion of James V. Derrick, Jr., Esq., Senior Vice
President and General Counsel of Enron, as to validity of
Debt Securities, Preferred Stock, Depositary Shares, Common
Stock and Stock Warrants.
12 -- Computation of Enron's Ratios of Earnings to Fixed Charges
and Preferred Stock Dividends.
23.01 -- Consent of Arthur Andersen LLP.
23.02 -- Consent of DeGolyer and MacNaughton.
23.03 -- The consent of James V. Derrick, Jr., Esq., is contained in
his opinion filed as Exhibit 5 hereto.
24 -- Powers of Attorney.
25 -- Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Harris Trust and Savings Bank.
</TABLE>
- ---------------
* Incorporated by reference as indicated.
<PAGE> 1
[Form of Underwriting Agreement for Debt
Securities incorporating Enron Corp.
Underwriting Agreement Standard Provisions
dated September 15, 1997]
ENRON CORP.
UNDERWRITING AGREEMENT
FOR DEBT SECURITIES
____________, 199_
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Ladies and Gentlemen:
The underwriter or underwriters named below [, acting through
_____________, as representatives (the "Representatives"),] understand that
Enron Corp., an Oregon corporation (the "Company") proposes to issue and sell
$_________ aggregate principal amount of [Title of Securities] (the "Purchased
Securities"), registered on Registration Statement[s] No[s]. _________.
Subject to the terms and conditions set forth herein or incorporated by
reference herein and referred to below, the Company hereby agrees to sell and
the underwriter or underwriters named below (such underwriter or underwriters
being herein called the "Underwriters") agree to purchase, severally and not
jointly, the principal amounts of such Purchased Securities set forth below
opposite their names at a purchase price equal to ___% of the principal amount
thereof [plus accrued interest on the Purchased Securities from ___________,
199_ to the date of payment and delivery]:
<TABLE>
<CAPTION>
Name Principal Amount. Name Principal Amount
---- ----------------- ---- ----------------
<S> <C> <C> <C> <C>
---------
Total: $
=========
</TABLE>
<PAGE> 2
[The aggregate principal amount of Purchased Securities to be purchased
by the several Underwriters may be reduced by the aggregate principal amount of
Purchased Securities sold pursuant to delayed delivery contracts with
institutional investors.]*
The Underwriters will pay for such Purchased Securities (less any
Purchased Securities sold pursuant to delayed delivery contracts) upon delivery
thereof at [state location] at 10:00 a.m. (New York time on [state date].
The Purchased Securities shall have the following terms:
Maturity:
Initial Price to Public:
Interest Rate:
Redemption Provisions:
Interest Payment Dates:
Sinking Fund:
Date referred to in Section 6(1) of the Standard Provisions:
Purchase Price: ___% of the principal amount [plus accrued
interest from 199_ to the date of payment and
delivery]
Listing:
[other terms]:
[The commission to be paid to the Underwriters in respect of Purchased
Securities purchased pursuant to delayed delivery contracts arranged by the
Underwriters shall be an amount equal to ___% of the principal amount
thereof.]*
All statements, requests, notices, communications and agreements
hereunder shall be in writing, and if to the Underwriters shall be delivered or
sent by mail, telex or facsimile transmission to the Underwriters in care of
_______ at _______________________, Attention: ____________________________,
Facsimile No. __________________; and if to the Company shall be delivered or
sent by mail, telex or facsimile transmission to it at 1400 Smith Street,
Houston, Texas 77002, Attention: William D. Gathmann, Vice President, Finance
and Treasurer, Facsimile No. (713) 646-5930; provided, however, that any notice
to an Underwriter pursuant to Section 9(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by such
Underwriter upon request. Any such statements, requests, notices,
communications or agreements shall take effect upon receipt thereof.
_________________________
* To be added only if delayed delivery contracts are contemplated.
-2-
<PAGE> 3
Unless otherwise provided herein, all the provisions contained in the
document entitled Enron Corp. Underwriting Agreement Standard Provisions dated
August ____, 1997, a copy of which was filed as an exhibit to Registration
Statement No. 333-______ or was filed as an Exhibit to Form 8-K and
subsequently incorporated by reference into such Registration Statement, are
hereby incorporated herein by reference in their entirety and shall be deemed
to be a part of this Agreement to the same extent as if such provisions had
been set forth in full herein.
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below and returning the signed
copy to us, and in addition have an authorized officer send us no later than
[state date and time] by wire, telex, facsimile transmission or other written
means, the following message:
"We have entered into the Underwriting Agreement dated [insert
date] relating to the Purchased Securities referred to therein by
signing a copy of the Underwriting Agreement and returning the same or
depositing the same in the mail to you."
Very truly yours,
[Name or names of Underwriter or Underwriters]
OR
[Name of Representative]
By:
-------------------------------------------
Name:
Title:
[Acting severally on behalf of [itself]
[themselves] and the several Underwriters
named above]
Accepted:
ENRON CORP.
By:
----------------------------------
Name:
Title:
-3-
<PAGE> 1
[Form of Underwriting Agreement for Equity
Securities incorporating Enron Corp.
Underwriting Agreement Standard Provisions
dated September 15, 1997]
ENRON CORP.
UNDERWRITING AGREEMENT
FOR EQUITY SECURITIES
____________, 199_
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Ladies and Gentlemen:
The underwriter or underwriters named below [, acting through
_____________, as representatives (the "Representatives"),] understand that
Enron Corp., an Oregon corporation (the "Company") proposes to issue and sell
______ shares of [Title of Securities], par value $_____ per share, [and the
stockholders listed on Schedule A hereto (the "Selling Stockholders") propose
severally to sell the number of shares set forth opposite their respective
names on Schedule A hereto, representing an aggregate of _______ shares of
[Title of Securities] of the Company] (such ____ shares of [Title of
Securities] being hereinafter referred to as the ("Purchased Securities"),
registered on Registration Statement[s] No[s]. _________. Subject to the terms
and conditions set forth herein or incorporated by reference herein and
referred to below, the Company [and each Selling Stockholder] hereby agrees
[severally and not jointly] to sell and the underwriter or underwriters named
below (such underwriter or underwriters being herein called the "Underwriters")
agree to purchase, severally and not jointly, at a purchase price equal to
$_____ per share, the respective number of Purchased Securities (rounded up or
down, as determined by the [Representatives] [the Underwriters] in their
discretion, in order to avoid fractions) obtained by multiplying the _______
shares of Purchased Securities [or the number of shares of Purchased Securities
set forth opposite the name of such Selling Stockholder on Schedule A hereto,
as the case may be,] by a fraction the
-1-
<PAGE> 2
numerator of which is the number of shares of Purchased Securities set forth
below and the denominator of which is _____________.
<TABLE>
<CAPTION>
Number of Purchased Number of Purchased
Name Securities Name Securities
---- ------------------- ---- -------------------
<S> <C> <C> <C>
---------
Total:
=========
</TABLE>
The Underwriters will pay for such Purchased Securities upon delivery
thereof at [state location] at 10:00 a.m. (New York time on [state date].
[In addition, at the option of the Underwriters, the Company proposes
to issue and sell to the Underwriters an aggregate of not more than _____
additional shares of [Title of Securities] [and certain of the Selling
Stockholders propose severally to sell to the Underwriters an aggregate of nor
more than _______ additional shares of [Title of Securities]] (such _______
additional shares being hereinafter collectively referred to as the "Optional
Securities").*
Upon written notice from the Underwriters given to the Company [and
the Selling Stockholders] not more than 30 days subsequent to the Closing Date,
the Underwriters may purchase all or less than all of the Optional Securities
at the purchase price per share to be paid for the Purchased Securities.
Subject to the foregoing, the Company [and each Selling Stockholder] agrees [,
severally and not jointly,] to sell to the Underwriters the respective numbers
of Optional Securities obtained by multiplying the number of shares specified
in such notice by a fraction the numerator of which is ____________ [in the
case of the Company and the number of shares set forth opposite the names of
each Selling Stockholder listed on Schedule A hereto under the caption "Number
of Optional Securities" in the case of the Selling Stockholders] and the
denominator of which is ___________________ (subject to adjustment by the
Underwriters to eliminate fractions). Such Optional Shares shall be purchased
from the Company [and each Selling Stockholder] for the account of each
Underwriter in the same proportion as the number of Purchased Securities set
forth opposite such Underwriter's name bears to the total number of Purchased
Securities (subject to adjustment by the Underwriters to eliminate fractions)
and may be purchased by the Underwriters only for the purpose of covering
overallotments made in connection with the sale of the Purchased Securities.
No Optional Securities shall be sold or delivered unless the Purchased
Securities previously have been, or simultaneously are, sold and delivered.
The right to purchase the Optional Securities or any portion thereof may be
surrendered and terminated at any time upon notice by the
____________________
* To be added only if the Underwriters are granted an option to purchase
additional shares.
-2-
<PAGE> 3
Underwriters to the Company [and the Selling Stockholders]. The Underwriters
will pay for such Optional Securities upon delivery thereof at [state location]
at 10:00 a.m. (New York time) on a date determined by the Underwriters (which
may be the Closing Date, but shall not be later than 7 days after written
notice of election to purchase Optional Securities is given.*
The following provisions shall apply to the Purchased Securities [and
the Optional Securities]:
[Voting Rights]:
[Dividends]:
[Conversion]:
Date referred to in Section 6(1) of the Standard Provisions:
Listing:
[other terms]:
All statements, requests, notices, communications and agreements
hereunder shall be in writing, and if to the Underwriters shall be delivered or
sent by mail, telex or facsimile transmission to the Underwriters in care of
_______ at _______________________, Attention:______________________, Facsimile
No. __________________________; and if to the Company shall be delivered or
sent by mail, telex or facsimile transmission to it at 1400 Smith Street,
Houston, Texas 77002, Attention: William D. Gathmann, Vice President, Finance
and Treasurer, Facsimile No. (713) 646-5930; provided, however, that any notice
to an Underwriter pursuant to Section 9(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by such
Underwriter upon request. Any such statements, requests, notices,
communications or agreements shall take effect upon receipt thereof.
Unless otherwise provided herein, all the provisions contained in the
document entitled Enron Corp. Underwriting Agreement Standard Provisions dated
August __, 1997, a copy of which was filed as an exhibit to Registration
Statement No. 333-______ or was filed as an Exhibit to Form 8-K and
subsequently incorporated by reference into such Registration Statement, are
hereby incorporated herein by reference in their entirety and shall be deemed
to be a part of this Agreement to the same extent as if such provisions had
been set forth in full herein.
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below and returning the signed
copy to us, and in addition have an authorized
___________________
* To be added only if the Underwriters are granted an option to purchase
additional shares.
-3-
<PAGE> 4
officer send us no later than [state date and time] by wire, telex, facsimile
transmission or other written means, the following message:
"We have entered into the Underwriting Agreement dated [insert
date] relating to the Purchased Securities referred to therein by
signing a copy of the Underwriting Agreement and returning the same or
depositing the same in the mail to you."
Very truly yours,
[Name or names of Underwriter or Underwriters]
OR
[Name of Representative]
By:
-----------------------------------------
Name:
Title:
[Acting severally on behalf of [itself]
[themselves] and the several Underwriters
named above]
Accepted:
ENRON CORP.
By:
----------------------------------
Name:
Title:
[Name of each Selling Stockholder]
[By:
----------------------------------
Name:
[Title:]
-4-
<PAGE> 1
ENRON CORP.
SECURITIES
UNDERWRITING AGREEMENT
STANDARD PROVISIONS
September 15, 1997
Enron Corp., an Oregon corporation (the "Company"), proposes to issue
and sell from time to time certain of its securities, including its debt
securities ("Debt Securities") and its equity securities ("Equity Securities")
registered under the Securities Act of 1933, as amended (the "Securities Act"),
as set forth in Section 3. The Debt Securities are to be issued under an
indenture, dated as of November 1, 1985, as supplemented and amended (the
"Indenture"), between the Company and Harris Trust and Savings Bank, as Trustee
(the "Trustee").
From time to time, the Company may enter into one or more underwriting
agreements that provide for the sale of certain of the Debt Securities or
Equity Securities to the underwriter or several underwriters named therein (the
"Underwriters"). The standard provisions set forth herein may be incorporated
by reference in any such underwriting agreement (an "Underwriting Agreement").
The Underwriting Agreement, including the provisions hereof incorporated
therein by reference, is herein referred to as this "Agreement."
1. Sale and Purchase of the Securities. On the basis of the
representations, warranties and agreements herein contained, the Company
proposes to issue and sell (i) the Debt Securities in one or more series, which
series may vary as to their terms (including, but not limited to, interest
rate, maturity, any redemption provisions and any sinking fund requirements),
all of such terms for any particular series being determined at the time of
sale, or (ii) Equity Securities in one or more class or series, which series
may vary as to their terms (including, but not limited to voting rights,
dividends and conversion), all of such terms for a particular series being
determined at the time of sale. All or a portion of particular series of the
Debt Securities or of particular classes or series of the Equity Securities
will be purchased by the Underwriters for resale upon terms of offering
determined at the time of sale. The securities so to be purchased in any such
offering are hereinafter referred to as the "Purchased Securities," and any
firm or firms acting as representatives of such Underwriters are hereinafter
referred to as the "Representatives." If with respect to the Purchased
Securities such Representatives are acting on behalf of the Underwriters,
references herein to the Underwriters (or a majority in interest thereof) or
the Representatives in the alternative shall be deemed to refer only to the
Representatives. The term "Underwriters' Securities" means Debt Securities
which are Purchased Securities other than Contract Securities. The term
"Contract Securities" means Debt Securities which are Purchased Securities, if
any, to be purchased pursuant to delayed delivery contracts referred to below.
<PAGE> 2
If this Agreement provides for sales of Debt Securities pursuant to
delayed delivery contracts, the Company hereby authorizes the Underwriters to
solicit offers to purchase Contract Securities on the terms and subject to the
conditions set forth in the Prospectus (as hereinafter defined) pursuant to
delayed delivery contracts substantially in the form of Schedule I attached
hereto (the "Delayed Delivery Contracts") but with such changes therein as the
Company may authorize or approve. Delayed Delivery Contracts are to be with
institutional investors approved by the Company and of the types set forth in
the Prospectus. On the Closing Date (as hereinafter defined), the Company will
pay the Underwriters in immediately available funds the fee set forth in the
Underwriting Agreement in respect of the principal amount of Contract
Securities. The Underwriters will not have any responsibility in respect of
the validity or the performance of any Delayed Delivery Contracts.
If the Company executes and delivers Delayed Delivery Contracts with
institutional investors, the Contract Securities shall be deducted from the
Debt Securities to be purchased by the several Underwriters and the aggregate
principal amount of Debt Securities to be purchased by each Underwriter shall
be reduced pro rata in proportion to the principal amount of Debt Securities
set forth opposite each Underwriter's name in the Underwriting Agreement,
except to the extent that the Representatives, if any, determine that such
reduction shall be otherwise and so advise the Company.
The obligations of the Underwriters under this Agreement are several
and not joint.
2. Payment and Delivery. Delivery by the Company of the
Purchased Securities or, if this Agreement provides for sales of Debt
Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, and payment by the Underwriters therefor in immediately available
funds shall take place at the office, on the date or dates and at the time or
times specified in this Agreement, each of which date and time may be postponed
for not more than ten business days by agreement between a majority in interest
of the Underwriters or the Representatives and the Company (each such date and
time of delivery and payment for the Purchased Securities or, if this Agreement
provides for sales of Debt Securities pursuant to delayed delivery contracts,
the Underwriters' Securities, is hereinafter referred to as the "Closing
Date").
The Purchased Securities or, if this Agreement provides for sales of
Debt Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, shall be registered in such names and shall be in such
denominations as the Underwriters or Representatives shall request at least one
full business day prior to the Closing Date and, if requested, shall be made
available to the Underwriters or Representatives for checking and packaging at
least one full business day prior to the Closing Date.
3. Registration Statement and Prospectus; Public Offering. The
Company has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act
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<PAGE> 3
and the rules and regulations adopted by the Commission thereunder (the
"Rules"), a registration statement or statements on Form S-3, including a
prospectus, relating to the Debt Securities and the Equity Securities, and such
registration statement has or such registration statements have become
effective. Such registration statement or statements referred to in the first
paragraph of the Underwriting Agreement, including financial statements,
exhibits and Incorporated Documents (as hereinafter defined), as amended to the
date of this Agreement, is or are hereinafter referred to as the "Registration
Statement," and the prospectus or prospectuses included in the Registration
Statement or deemed, pursuant to Rule 429 under the Securities Act, to relate
to the Registration Statement, as proposed to be supplemented by a prospectus
supplement (including any preliminary prospectus supplement) relating to any
Purchased Securities to be filed pursuant to Rule 424 under the Securities Act,
is or are hereinafter referred to as the "Prospectus." Any reference herein to
the Registration Statement or Prospectus shall be deemed to include all
documents incorporated, or deemed to be incorporated, therein by reference
pursuant to the requirements of Item 12 of Form S-3 under the Securities Act
(the "Incorporated Documents"). For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the Prospectus or
any amendment or supplement to any of the foregoing shall be deemed to include
the copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system (EDGAR), which EDGAR copy is substantially
identical to the other copies of such material, except to the extent permitted
by Regulation S-T.
The Company understands, and if this Agreement provides for sales by
one or more Selling Stockholders, each Selling Stockholder understands, that
the Underwriters propose to make a public offering of their respective portions
of the Purchased Securities, as set forth in and pursuant to the Prospectus
relating thereto.
4. Representations and Warranties.
(a) The Company represents and warrants to each
Underwriter that:
(i) The Company has reasonable grounds to believe
that it meets the requirements for the use of Form S-3 under
the Securities Act.
(ii) The Registration Statement, at the time it
became effective, and the prospectus contained therein,
complied, and on the date of the Underwriting Agreement and
the Closing Date and when any post-effective amendment to the
Registration Statement becomes effective or any supplement to
such prospectus is filed with the Commission, the Registration
Statement, the Prospectus and any such amendment or
supplement, respectively, will comply, in all material
respects with the requirements of the Securities Act and the
Rules; the Incorporated Documents
-3-
<PAGE> 4
complied and will comply in all material respects with the
requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations
adopted by the Commission thereunder; the Indenture complied
and will comply in all material respects with the requirements
of the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"); and each part of the Registration Statement
and any amendment thereto, at the time it became effective,
and the Prospectus and any amendment or supplement thereto, at
the time it was filed with the Commission pursuant to Rule 424
under the Securities Act, when such part became effective, did
not and will not contain an untrue statement of a material
fact or omit to a state a material fact required to be stated
therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not
misleading, except that this representation and warranty does
not apply to (i) statements or omissions in the Registration
Statement or Prospectus (or in amendments or supplements
thereto) made in reliance upon information furnished in
writing to the Company by any Underwriter or the
Representatives on behalf of any Underwriter or by any Selling
Stockholder expressly for use therein, or (ii) that part of
the Registration Statement which shall constitute the
Statement of Eligibility and Qualification of the Trustee,
under the Trust Indenture Act on Form T-1, except statements
or omissions in such Statement made in reliance upon
information furnished in writing to the Trustee on behalf of
the Company for use therein.
(iii) There are no contracts, agreements or
understandings between the Company and any person granting
such person the right to require the Company to include any
securities owned or to be owned by such person in the
securities registered pursuant to the Registration Statement.
(b) If this Agreement provides for sales by one or more
Selling Stockholders, each Selling Stockholder severally represents
and warrants to each Underwriter that such Selling Stockholder has (i)
good and valid title to, and full right, power and authority to
convert, convertible securities of the Company which are convertible
into at least the number of shares of Purchased Securities to be sold
by it pursuant to this Agreement; and immediately after the execution
of this Agreement such Selling Stockholder will convert into Purchased
Securities at least such number of convertible securities; and upon
such conversion and on each Closing Date such Selling Stockholder will
have good and valid title to the shares of the Purchased Securities to
be sold by such Selling Stockholder or (ii) has and on each Closing
Date will have good and valid title to the shares of Purchased
Securities to be sold by such Selling Stockholder. Such Selling
Stockholder has full right, power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the shares of the
Purchased Securities to be sold by such Selling Stockholder hereunder;
and upon the
-4-
<PAGE> 5
delivery of and payment for the Purchased Securities hereunder the
several Underwriters will acquire good and valid title to the shares
of the Purchased Securities to be sold by such Selling Stockholder.
5. Conditions of the Underwriters' Obligations. The obligations
of the Underwriters hereunder to purchase and pay for the Purchased Securities
or, if this Agreement provides for sales of Debt Securities pursuant to delayed
delivery contracts, the Underwriters' Securities, are subject to the following
conditions:
(a) Within 24 hours after the execution of the
Underwriting Agreement by the Company (or at such later time
acceptable to the Representatives, or if there are none, such firm as
may be designated by a majority in interest of the Underwriters) and
on the Closing Date, the Representatives or such designated firm shall
have received from the independent accountants of the Company who have
certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement
signed letters dated the respective dates of delivery, in form and
substance satisfactory to the Representatives or such designated firm
and stating to the effect set forth in Schedules II-A and II-B hereto,
respectively.
(b) No stop order suspending the effectiveness of the
Registration Statement under the Securities Act shall be in effect and
no proceedings for such purpose shall be pending before or threatened
by the Commission and any requests for additional information on the
part of the Commission (to be included in the Registration Statement
or the Prospectus or otherwise) shall have been complied with to the
reasonable satisfaction of the Underwriters or the Representatives.
(c) Subsequent to the execution of this Agreement, there
shall not have been any change in the capital stock or long-term debt
of the Company or any material adverse change in the general affairs,
management, financial position or results of operations of the Company
and its subsidiaries taken as a whole, whether or not arising in the
ordinary course of business, in each case other than as set forth in
or contemplated by the Registration Statement and Prospectus, if in
the reasonable judgment of a majority in interest of the Underwriters
or of the Representatives any such change makes it impracticable or
inadvisable to consummate the sale and delivery of the Purchased
Securities or, if this Agreement provides for sales of Debt Securities
pursuant to delayed delivery contracts, the Underwriters' Securities,
by the Underwriters as contemplated in the Prospectus.
(d) The representations and warranties of the Company
contained herein shall be true and correct on and as of the Closing
Date and the Company shall have performed all
-5-
<PAGE> 6
covenants and agreements herein contained to be performed on its part
at or prior to the Closing Date.
(e) The Underwriters or Representatives shall have
received on the Closing Date a certificate, dated the Closing Date, of
the Chief Executive Officer, the President, any Executive Vice
President, any Senior Vice President or the Vice President and
Treasurer of the Company, which shall certify that (i) no order
suspending the effectiveness of the Registration Statement or the
qualification of the Indenture has been issued and, to the knowledge
of such officer, no proceedings for such purpose are pending before or
threatened by the Commission, (ii) the representations and warranties
of the Company contained herein are true and correct on and as of the
Closing Date, and (iii) the Company has performed all covenants and
agreements herein contained to be performed on its part at or prior to
the Closing Date.
(f) The Underwriters or the Representatives shall have
received on the Closing Date from James V. Derrick, Jr., Esq., Senior
Vice President and General Counsel of the Company, an opinion, dated
the Closing Date, substantially to the effect as set forth in Schedule
III hereto. In rendering such opinion, Mr. Derrick may rely upon
Bracewell & Patterson, L.L.P. as to matters of New York law.
(g) The Underwriters or the Representatives shall have
received on the Closing Date from Bracewell & Patterson, L.L.P.,
counsel for the Underwriters, an opinion, dated the Closing Date, with
respect to the Company, the Indenture, the Purchased Securities or, if
this Agreement provides for sales of Debt Securities pursuant to
delayed delivery contracts, the Underwriters' Securities, the
Registration Statement and Prospectus and this Agreement. The Company
and, if this Agreement provides for sales by Selling Stockholders,
each Selling Stockholder shall have furnished to counsel for the
Underwriters such documents as they may reasonably request for the
purpose of enabling them to render such opinions.
(h) Subsequent to the date of the Underwriting Agreement,
no downgrading shall have occurred in the rating accorded the
Company's debt securities or preferred stock by any "nationally
recognized statistical rating organization," as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the Securities
Act, nor shall there have been any public announcement that any such
organization has under surveillance or review its ratings of any debt
securities or preferred stock of the Company (other than an
announcement with positive implication of a possible upgrading, and no
implication of a possible downgrading of such rating).
-6-
<PAGE> 7
(i) If this Agreement provides for sales by Selling
Stockholders, the Underwriters or Representatives shall have received
on the Closing Date a certificate, dated the Closing Date, of the
President or any Vice President of each Selling Stockholder, which
shall certify that (i) the representations and warranties of such
Selling Stockholder contained herein are true and correct on and as of
the Closing Date, and (ii) such Selling Stockholder has performed all
covenants and agreements herein contained to be performed on its part
at or prior to the Closing Date.
(j) If this Agreement provides for sales by Selling
Stockholders, the Underwriters or Representatives shall have received
on the Closing Date from counsel for each Selling Stockholder, an
opinion, dated the Closing Date, substantially to the effect as set
forth in Schedule V hereto.
6. Covenants. The Company and, if this Agreement provides for
sales by Selling Stockholders, each Selling Stockholder as to paragraphs (a),
(c), (h), (k), (l) and (m), covenants and agrees with the several Underwriters
as follows:
(a) To advise the Underwriters or the Representatives
promptly of any amendment or supplement of the Registration Statement
or the Prospectus which is proposed to be filed and not to effect such
amendment or supplement in a form to which the Underwriters or the
Representatives reasonably object.
(b) To furnish to each of the Underwriters or the
Representatives and to the counsel for the Underwriters, one copy of
the Registration Statement filed pursuant to EDGAR, including exhibits
and Incorporated Documents, relating to the Debt Securities and the
Equity Securities in the form it became effective and of all
amendments thereto, including exhibits; and to each such firm and
counsel, copies of each preliminary prospectus supplement and
Prospectus and any amendment or supplement thereto relating to the
Debt Securities and the Equity Securities.
(c) As soon as it is advised thereof, to advise the
Underwriters or the Representatives (i) of the initiation or
threatening by the Commission of any proceedings for the issuance of
any order suspending the effectiveness of the Registration Statement
or the qualification of the Indenture or preventing or suspending the
use of any preliminary prospectus supplement, (ii) of receipt by it or
any representative or attorney of it of any other communication from
the Commission relating to the Company, any Selling Stockholders, the
Registration Statement or the Prospectus, or (iii) suspension of
qualification of the Purchased Securities for offering or sale in any
jurisdiction. The Company will make every reasonable effort to
prevent the issuance of an order suspending the effectiveness of the
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<PAGE> 8
Registration Statement or the qualification of the Indenture, and if
any such order is issued, to obtain as soon as possible the lifting
thereof.
(d) To deliver to the Underwriters or the
Representatives, without charge, as many conformed copies of the
Indenture, the Registration Statement (excluding exhibits but
including the Incorporated Documents), each preliminary prospectus
supplement, the Prospectus and all amendments and supplements to such
documents as the Underwriters or the Representatives may reasonably
request.
(e) During such period as a prospectus is required by law
to be delivered by an Underwriter or dealer, to deliver, without
charge, to Underwriters and dealers, at such office or offices as the
Underwriters or the Representatives may designate, as many copies of
the Prospectus and any amendment or supplement thereto as the
Underwriters or the Representatives may reasonably request.
(f) During the period in which copies of the Prospectus
are to be delivered as provided in paragraph (e) above, if any event
occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading, or if for any reason it shall be necessary
during such same period to file any document which will be deemed an
Incorporated Document in order to comply with the Exchange Act and the
rules and regulations thereunder, forthwith to prepare, submit to the
Underwriters or the Representatives, file with the Commission and
deliver, without charge to the Underwriters either (i) amendments or
supplements to the Prospectus so that the statements in the
Prospectus, as so amended or supplemented, will not be misleading or
(ii) documents which will effect such compliance. Delivery by
Underwriters of any such amendments or supplements to the Prospectus
or documents shall not constitute a waiver of any of the conditions
set forth in Section 5 hereof.
(g) To make generally available to the Company's security
holders, as soon as practicable, an earnings statement which satisfies
the provisions of Section 11(a) of the Securities Act.
(h) To cooperate with the Underwriters or the
Representatives in qualifying the Purchased Securities for offer and
sale under the securities or "blue sky" laws of such jurisdictions as
the Underwriters or the Representatives may reasonably request;
provided that in no event shall the Company nor any Selling
Stockholder be obligated to qualify to do business in any jurisdiction
where it is not now so qualified, to take any action which would
-8-
<PAGE> 9
subject it to service of process in suits, other than those arising
out of the offering or sale of the Purchased Securities, in any
jurisdiction where it is not now so subject, qualify in any
jurisdiction as a broker-dealer or subject itself to any taxing
authority where it is not now so subject.
(i) Unless otherwise specified, to endeavor to obtain as
promptly as practicable the listing of the Purchased Securities on the
New York Stock Exchange and, if the Purchased Securities are of a
class or series of securities which is already listed on the New York
Stock Exchange or any other stock exchange, to effect the listing of
the Purchased Securities on such stock exchanges prior to the Closing
Date.
(j) During the period of five years from the date hereof,
to supply to the Representatives, if any, and to each other
Underwriter who may so request in writing, copies of such financial
statements and other periodic and special reports as the Company may
from time to time distribute generally to its lenders or to the
holders of any class of its securities registered under Section 12 of
the Exchange Act and to furnish to the Underwriters or the
Representatives a copy of each annual or other report it shall be
required to file with the Commission.
(k) To pay all of its own expenses incurred in connection
with the performance of its obligations under this Agreement, and the
Company will pay, or reimburse if paid by the Underwriters or the
Representatives, whether or not the transactions contemplated hereby
are consummated or this Agreement is terminated, all reasonable costs
and expenses incident to the performance of the obligations of the
Company under this Agreement, including those relating to (i) the
preparation, printing and filing of the Registration Statement and
exhibits thereto, each preliminary prospectus, any preliminary
prospectus supplement, the Prospectus, all amendments and supplements
to the Registration Statement and the Prospectus, the printing of the
Indenture and the printing or typing of the Underwriting Agreement
(including any Agreement Among Underwriters), (ii) the issuance,
preparation and delivery of the Purchased Securities to the
Underwriters, and if applicable, those entering into delayed delivery
contracts with the Company, including the costs and expenses of any
Trustee, Registrar, Transfer Agent and any agent thereof, including
any fees and disbursements of counsel therefor, (iii) the registration
or qualification of the Purchased Securities for offer and sale under
the securities or "blue sky" laws of the various jurisdictions
referred to in paragraph (h) above, including the fees and
disbursements of counsel for the Underwriters in connection therewith
and the preparation and printing or typing of legal investment and
preliminary and supplementary "blue sky" memoranda, (iv) the
furnishing to the Underwriters and the Representatives, if any, of
copies of the Prospectus and all amendments or supplements to the
Prospectus, and of the several documents required by this Section to
-9-
<PAGE> 10
be so furnished, including costs of shipping and mailing, (v) the
listing of the Purchased Securities on any securities exchange, (vi)
the rating of the Purchased Securities by rating agencies, and (vii)
the furnishing to the Underwriters and the Representatives, if any, of
copies of all reports and information required by paragraph (j) above,
including costs of shipping and mailing. If a separate agreement
exists between the Company and any Selling Stockholder which allocates
such costs and expenses in a manner different from that set forth
above, such agreement shall control as between the Company and such
Selling Stockholder only, but such agreement shall not modify the
obligations of the Company and the Selling Stockholder to the
Underwriters to cause the payment of costs and expenses as set forth
above.
(l) During the period beginning on the date of the
Underwriting Agreement and continuing to the date specified in the
Underwriting Agreement, not to offer, sell, contract to sell or
otherwise dispose of any securities of the Company substantially
similar to the Purchased Securities, without the prior written consent
of a majority in interest of the Underwriters or the Representatives.
(m) If this Agreement provides for sales by Selling
Stockholders, each Selling Stockholder agrees to deliver to the
Underwriters or the Representatives on or prior to the Closing Date a
properly completed and executed United States Treasury Department Form
W-9 (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof).
7. Indemnification.
(a) The Company will indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, as follows:
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission
or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
-10-
<PAGE> 11
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 7(e) below)
any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as
incurred (including, subject to Section 7(d) hereof, the fees and
disbursements of counsel chosen by the Underwriters), reasonably
incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above; provided, however, that the indemnity set
forth in this Section 7(a) shall not apply to any loss, liability,
claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter expressly for use in
the Registration Statement (or any amendment thereto), or any
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto). The foregoing indemnity with respect to any
untrue statement or alleged untrue statement contained in or omission
or alleged omission from a preliminary prospectus shall not inure to
the benefit of the Underwriter (or any person controlling such
Underwriter) from whom the person asserting any loss, liability,
claim, damage or expense purchased any of the Purchased Securities
which are the subject thereof if the Company shall sustain the burden
of proving that such person was not sent or given a copy of the
Prospectus (or the Prospectus as amended or supplemented) at or prior
to the written confirmation of the sale of such Purchased Securities
to such person and the untrue statement contained in or omission from
such preliminary prospectus was corrected in the Prospectus (or the
Prospectus as amended or supplemented) and the Company had previously
furnished copies thereof to such Underwriter.
(b) If this Agreement provides for sales by Selling
Stockholders, each of the Selling Stockholders severally will
indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Company to each Underwriter, but
only insofar as losses, liabilities claims, damages, expenses or
actions arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission which was made in the
Registration
-11-
<PAGE> 12
Statement, the prospectus or any amendment or supplement thereto, in
reliance on and in conformity with information furnished in writing to
the Company by such Selling Stockholder expressly for use therein.
(c) Each Underwriter, severally in proportion to its
respective purchase obligation and not jointly, agrees to indemnify
and hold harmless the Company, directors of the Company, the officers
of the Company who signed the Registration Statement, and each person,
if any, who controls the Company within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, against any and
all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred,
but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or
any amendment thereto), or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by
or on behalf of such Underwriter expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or
the Prospectus (or any amendment or supplement thereto).
(d) Each indemnified party shall give notice as promptly
as reasonably practicable to each indemnifying party of any action
commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in any
event shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to Section 7(a) above, counsel to the
indemnified parties shall be selected by the Underwriters, and, in the
case of parties indemnified pursuant to Section 7(c) above, counsel to
the indemnified parties shall be selected by the Company, provided
that if it so elects within a reasonable time after receipt of such
notice, an indemnifying party, jointly with any other indemnifying
parties receiving such notice, may assume the defense of such action
with counsel chosen by it and approved by the indemnified parties
defendant in such action, unless such indemnified parties reasonably
object to such assumption on the ground that there may be legal
defenses available to them which are different from or in addition to
those available to such indemnifying party. If an indemnifying party
assumes the defense of such action, the indemnifying parties shall not
be liable for any fees and expenses of counsel for the indemnified
parties incurred thereafter in connection with such action. An
indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no
event shall the indemnifying parties be liable for fees and expenses
-12-
<PAGE> 13
of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written
consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 7
or Section 8 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to
act by or on behalf of any indemnified party.
(e) If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for
reasonable fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature
contemplated by Section 7(a)(ii) effected without its written consent
if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered
into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of
such settlement. Notwithstanding the immediately preceding sentence,
if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, an indemnifying party shall not be liable for any
settlement of the nature contemplated by Section 7(a)(ii) effected
without its consent if such indemnifying party (i) reimburses such
indemnified party in accordance with such request to the extent it
considers such request to be reasonable and (ii) provides written
notice to the indemnified party substantiating the unpaid balance as
unreasonable, in each case prior to the date of such settlement.
8. Contribution.
If the indemnification provided for in Section 7 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company or the Selling
Stockholder, if any (taking into account the portion of the
-13-
<PAGE> 14
proceeds of the offering received by each), on the one hand and the
Underwriters on the other hand from the offering of the Purchased Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company and the Selling Stockholder, if any, on the
one hand and of the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Stockholder, if
any, on the one hand and the Underwriters on the other hand in connection with
the offering of the Purchased Securities pursuant to this Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of the Purchased Securities pursuant to this Agreement (before
deducting expenses but after deducting the total underwriting commission
received by the Underwriters) received by the Company and the Selling
Stockholder, if any, and the total underwriting commission received by the
Underwriters, in each case as set forth on the cover of the Prospectus, bear to
the aggregate initial public offering price of the Purchased Securities as set
forth on such cover. The relative fault of the Company and the Selling
Stockholder, if any, on the one hand and the Underwriters on the other hand
shall be determined by reference to, among other things, whether any such
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company and the Selling Stockholder, if any, or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the Selling
Stockholder, if any, and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 8. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 8 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged
untrue statement or omission or alleged omission. Notwithstanding the
provisions of this Section 8, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Purchased Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of any such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 8,
each person, if any, who controls an Underwriter within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act shall have the same
rights to contribution
-14-
<PAGE> 15
as such Underwriter; each director of the Company, each officer of the Company
who signed the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act shall have the same rights to contribution as the
Company; and if this Agreement provides for sales by Selling Stockholders, each
person, if any, who controls a Selling Stockholder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same rights to contribution as such Selling Stockholder. The Underwriters'
respective obligations to contribute pursuant to this Section 8 are several in
proportion to their respective underwriting obligations and not joint.
9. Termination. This Agreement may be terminated by a
majority in interest of the Underwriters or by the Representatives by notifying
the Company at any time
(a) at or prior to the Closing Date if, in the judgment
of such Underwriters or the Representatives, sale and delivery of the
Purchased Securities or, if this Agreement provides for the sale of
Debt Securities pursuant to delayed delivery contracts, the
Underwriters' Securities, as contemplated in the Prospectus is
rendered impracticable or inadvisable because (i) additional material
governmental restrictions, not in force and effect on the date hereof,
shall have been imposed upon trading in securities generally or
minimum or maximum prices shall have been generally established on the
New York Stock Exchange or on the American Stock Exchange, or trading
in securities generally shall have been suspended or materially
limited on either such Exchange or a general banking moratorium shall
have been established by Federal or New York authorities, (ii) any
event shall have occurred or shall exist which makes untrue or
incorrect in any material respect any statement or information
contained in the Registration Statement or Prospectus or which is not
reflected in the Registration Statement or Prospectus but should be
reflected therein in order to make the statements or information
contained therein not misleading in any material respect, or (iii) any
material adverse change shall have occurred in the financial markets
in the United States or elsewhere or a war or outbreak of hostilities
involving the United States or other calamity or crisis shall have
occurred or shall have escalated to such an extent as to affect
adversely the marketability of the Purchased Securities or, if this
Agreement provides for the sale of Debt Securities pursuant to delayed
delivery contracts, the Underwriters' Securities, or
(b) at or prior to the Closing Date, if any of the
conditions specified in Section 5 hereof shall not have been fulfilled
when and as required by this Agreement.
If this Agreement is terminated pursuant to any of the provisions
hereof, except as otherwise provided herein, the Company shall not be under any
liability to any Underwriter or any Selling Stockholder and no Underwriter
shall be under any liability to the Company or any Selling
-15-
<PAGE> 16
Stockholder, except that (a) if this Agreement is terminated by the
Underwriters or the Representatives because of any failure or refusal on the
part of the Company or any Selling Stockholder to comply with the terms or to
fulfill any of the conditions of this Agreement, the Company and each Selling
Stockholder, will reimburse the Underwriters for all reasonable out-of-pocket
expenses (including the fees and disbursement of their counsel) reasonably
incurred by them and (b) no Underwriter who shall have failed or refused to
purchase the Purchased Securities or, if this Agreement provides for sales of
Debt Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, agreed to be purchased by it hereunder, without some reason
sufficient hereunder to justify its cancellation or termination of its
obligations hereunder, shall be relieved of liability to the Company, any
Selling Stockholder or the other Underwriters for damages occasioned by its
default.
10. Default of Underwriters. If one or more of the Underwriters
shall fail (other than for a reason sufficient to justify the termination of
this Agreement) to purchase on the Closing Date the principal amount of
Purchased Securities or, if this Agreement provides for sales of Debt
Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, agreed to be purchased by such Underwriter or Underwriters, the
Representatives, or if there are none, such firm as may be designated by a
majority in interest of the Underwriters may find one or more substitute
underwriters to purchase such Purchased Securities or, if this Agreement
provides for sales of Debt Securities pursuant to delayed delivery contracts,
the Underwriters' Securities, or make such other arrangements as they may deem
advisable or one or more of the remaining Underwriters may agree to purchase
such Purchased Securities or, if this Agreement provides for sales of Debt
Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, in such proportions as may be approved by the Representatives or
such designated firm, in each case upon the terms herein set forth. If no such
arrangements have been made within 24 hours after the Closing Date, and
(a) the aggregate principal amount or number of shares,
as the case may be, of Purchased Securities or, if this Agreement
provides for sales of Debt Securities pursuant to delayed delivery
contracts, the Underwriters' Securities, to be purchased by the
defaulting Underwriter or Underwriters shall not exceed 10% of the
total principal amount or number of shares, as the case may be, of
Purchased Securities or, if this Agreement provides for sales of Debt
Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, each of the non-defaulting Underwriters shall be obligated
to purchase such Purchased Securities or, if this Agreement provides
for sales of Debt Securities pursuant to delayed delivery contracts,
the Underwriters' Securities, on the terms herein set forth in
proportion to their respective obligations hereunder, or
(b) the aggregate principal amount or number of shares,
as the case may be, of Purchased Securities or, if this Agreement
provides for sales of Debt Securities pursuant to
-16-
<PAGE> 17
delayed delivery contracts, the Underwriters' Securities, to be
purchased by the defaulting Underwriter or Underwriters shall exceed
10% of the total principal amount or number of shares, as the case may
be, of Purchased Securities or, if this Agreement provides for sales
of Debt Securities pursuant to delayed delivery contracts, the
Underwriters' Securities, the Company shall be entitled to an
additional period of 24 hours within which to find one or more
substitute underwriters satisfactory to the Representatives, or if
there are none, to such designated firm to purchase such Purchased
Securities or, if this Agreement provides for sales of Debt Securities
pursuant to delayed delivery contracts, the Underwriters' Securities,
upon the terms set forth herein.
In any such case, either the Representatives, or if there are none,
such designated firm or the Company shall have the right to postpone the
Closing Date for a period of not more than seven business days in order that
necessary changes and arrangements may be effected. If the aggregate principal
amount or number of shares, as the case may be, of the Purchased Securities or,
if this Agreement provides for sales of Debt Securities pursuant to delayed
delivery contracts, the Underwriters' Securities, to be purchased by such
defaulting Underwriters shall exceed 10% of the total principal amount or
number of shares, as the case may be, of Purchased Securities or, if this
Agreement provides for sales of Debt Securities pursuant to delayed delivery
contracts, the Underwriters' Securities, and neither the non- faulting
Underwriters nor the Company shall make arrangements pursuant to this Section
10 within the period stated for the purchase of the Purchased Securities or, if
this Agreement provides for sales of Debt Securities pursuant to delayed
delivery contracts, the Underwriters' Securities, which the defaulting
Underwriter or Underwriters agreed to purchase, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter and without
liability on the part of the Company or any Selling Stockholder, except, in
each case, as provided in Section 6(k), 7, 8 and 9 hereof. The provisions of
this Section 10 shall not in any way affect the liability of any defaulting
Underwriter to the Company, any Selling Stockholder or the non-defaulting
Underwriters arising to of such default. A substitute underwriter hereunder
shall become an Underwriter for all purposes of this Agreement.
11. Miscellaneous. The reimbursement, indemnification and
contribution agreements contained in Sections 6(k), 7 and 8 hereof and the
representations, warranties, covenants and agreements of the Company and any
Selling Stockholder in this Agreement shall remain in full force and effect
regardless of (a) any termination of this Agreement, (b) any investigation (or
any statement as to the results thereof) made by or on behalf of any
Underwriter or any officer, director or controlling person, or by or on behalf
of the Company or any officer, director or controlling person, or by or on
behalf of any Selling Stockholder or any officer, director or controlling
person, and (c) delivery of and payment for Purchased Securities under this
Agreement.
-17-
<PAGE> 18
This Agreement has been and is made solely for the benefit of the
Underwriters, any Selling Stockholder and the Company and their respective
successors and assigns, and, to the extent expressed herein, for the benefit of
persons controlling any of the Underwriters, any Selling Stockholder or the
Company, directors and officers of the Company, and their respective successors
and assigns, and no other person, partnership, association or corporation shall
acquire or have any right under or by virtue of this Agreement. The term
"successors and assigns" shall not include any purchaser of Purchased
Securities, Underwriters' Securities or Contract Securities merely because of
such purchase.
In dealings hereunder, the Representatives, if designated, shall act
on behalf of each of the Underwriters, and the parties hereto shall be entitled
to act and rely upon any statement, request, notice or agreement on behalf of
any Underwriter made or given by such firm as the Representatives may designate
to the Company.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
-18-
<PAGE> 19
SCHEDULE I
DELAYED DELIVERY CONTRACT
__________, 199__
Ladies and Gentlemen:
The undersigned hereby agrees to purchase from Enron Corp., an Oregon
corporation (the "Company"), and the Company agrees to sell to the undersigned
_______________________________________________________________________________
________________________________________________________________________________
_________________________________________ _____________________
$________________ principal amount of the Company's [state title of issue] (the
"Securities"), offered by the Company's Prospectus dated _________, 199__ and
Prospectus Supplement dated __________, 199__, receipt of copies of which are
hereby acknowledged, at a purchase price equal to __% of the principal amount
thereof plus accrued interest from ____________, 199__ to the date or dates for
payment and delivery thereof and on the further terms and conditions set forth
in this contract. The undersigned does not contemplate selling Securities prior
to making payment therefor.
The undersigned will purchase from the Company Securities in the
principal amounts and on the delivery date or dates set forth below:
Principal Plus Accrued
Delivery Date Amount Interest From:
- ------------- ------ --------------
$
$
$
Each such date on which Securities are to be purchased hereunder is hereinafter
referred to as a "Delivery Date".
Payment for the Securities which the undersigned has agreed to
purchase on each Delivery Date shall be made to the Company or its order by
certified or official bank check in New York Clearing House funds (available on
the next business day) at the office of _____________, New York, New York, at
10:00 a.m. (New York time) on the Delivery Date, upon delivery to the
undersigned of the Securities to be purchased by the undersigned on the
Delivery Date, in such denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than five full business days prior to the Delivery Date.
If no such request is received, the Securities will be registered in the name
of the
<PAGE> 20
undersigned and issued in a denomination equal to the aggregate principal
amount of Securities to be purchased by the Delivery Date.
By the execution hereof, the undersigned represents and warrants to
the Company that (i) all necessary corporate action for the due execution and
delivery of this contract and payment for and purchase of the Securities has
been taken by it, (ii) no further authorization or approval of any governmental
or other regulatory authority is required for such execution, delivery, payment
or purchase, and (iii) its investment in the Securities is not, as of the date
hereof, prohibited under the laws of any jurisdiction to which the undersigned
is subject and which govern such investment.
The obligation of the undersigned to take delivery of and make payment
for the Securities on the Delivery Date shall be subject to the conditions that
(1) the purchase of Securities to be made by the undersigned shall not at the
time of delivery be prohibited under the laws of the jurisdiction to which the
undersigned is subject and (2) the Company shall have sold, and delivery shall
have taken place to the underwriters (the "Underwriters") named in the
Prospectus Supplement referred to above, of such part of the Securities as is
to be sold to them. Promptly after completion of sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned at its
address set forth below notice to such effect, accompanied by a copy of the
opinion of counsel for the Company delivered to the Underwriters in connection
therewith.
Failure to take delivery of and make payment for Securities by any
purchaser under any other delayed delivery contract shall not relieve the
undersigned of its obligations under this contract.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on a first-come, first-served basis.
If this contract is acceptable to the Company, it is requested that
the Company sign the form of acceptance below and mail or deliver one of the
counterparts hereof to the undersigned at its address set forth below. This
will become a binding contract, as of the date first above written, between the
Company and the undersigned when such counterpart is so mailed or delivered.
THIS CONTRACT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
-2-
<PAGE> 21
Yours very truly,
------------------------------------
(Purchaser)
By:
------------------------------------
Name:
Title:
Accepted:
ENRON CORP.
By:
-------------------
Name:
Title:
------------------------------------
------------------------------------
(Address)
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name, telephone number and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed
are as follows: (Please print.)
Telephone Number
Name (Including Area Code) Dept.
- ---- --------------------- -----
-3-
<PAGE> 22
SCHEDULE II-A
[FORM OF FIRST LETTER OF ACCOUNTANTS
TO BE DELIVERED PURSUANT TO SECTION 5(a)]
(i) They are independent public accountants within the meaning of the
Securities Act and the Exchange Act and the respective applicable published
rules and regulations thereunder and the answer to item 10 of Form S-3 set
forth in the Registration Statement is correct insofar as it relates to them;
(ii) In their opinion the audited financial statements and financial
statement schedules included or incorporated in the Prospectus and reported on
by them comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the published rules and
regulations thereunder;
(iii) On the basis of a reading of the unaudited financial statements,
the unaudited notes to the audited financial statements and the supplementary
financial information incorporated in the Prospectus and of the latest
unaudited financial statements made available by the Company and its
subsidiaries; carrying out certain specified procedures (but not an examination
in accordance with generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the comments set
forth in such letter; a reading of the minutes of the meetings of the
stockholders, directors and executive committees of the Company and certain of
its subsidiaries; and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company and its
subsidiaries as to transactions and events subsequent to the date of the latest
audited financial statements incorporated in the Prospectus, nothing came to
their attention which caused them to believe that:
(1) the unaudited notes to the audited financial statements and
the supplementary financial information incorporated in the Prospectus
do not comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act and with the published
rules and regulations of the Commission thereunder; or
(2) the unaudited financial statements included or incorporated in
the Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the Exchange Act and with
the published rules and regulations thereunder; and said unaudited
financial statements are not presented in conformity with generally
accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements incorporated
in the Prospectus; and
<PAGE> 23
(iv) They have performed certain other specified procedures as
a result of which they determined that certain information (if any)
specified by the Representatives or, if there are none, such firm as
may be designated by a majority in interest of the Underwriters, of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company) incorporated in the
Prospectus, agrees with the accounting records of the Company and its
subsidiaries, excluding any questions of legal interpretation.
-2-
<PAGE> 24
SCHEDULE II-B
[FORM OF SECOND LETTER TO ACCOUNTANTS
TO BE DELIVERED PURSUANT TO SECTION 5(a)]
(i) On the basis of a reading of the latest unaudited financial
statements made available by the Company and its subsidiaries; carrying out
certain specified procedures (but not an examination in accordance with
generally accepted auditing standards) which would not necessarily reveal
matters of significance with respect to the commitments set forth in such
letter; a reading of the minutes of the meetings of the stockholders, directors
and executive committees of the Company and certain of its subsidiaries; and
inquiries of certain officials of the Company who have responsibility for
financial and accounting matters of the Company and its subsidiaries as to
transactions and events subsequent to the date of the latest financial
statements included or incorporated in the Prospectus, nothing came to their
attention which caused them to believe that: (a) with respect to the period
subsequent to the date of the latest consolidated balance sheet included or
incorporated in the Prospectus, there were, at a subsequent specified date not
more than five business days prior to the Closing Date, any change in the
capital stock or increases in short-term debt or long-term debt of the Company
and consolidated subsidiaries or any decreases in the consolidated net current
assets or net assets as compared with the amounts shown on the latest
consolidated balance sheet included or incorporated in the Prospectus; or (b)
for the period from the date of the latest financial statements included or
incorporated in the Prospectus to such specified date there were any decreases,
as compared with the corresponding period in the preceding year, in
consolidated operating revenues, net income or earnings per common share,
except in all instances for changes or decreases which the Prospectus discloses
have occurred or may occur or which are set forth in such letter; and
(ii) They have performed certain other specified procedures as a
result of which they determined that certain information (if any) specified by
the Representatives or, if, there are none, such firm as may be designated by a
majority in interest of the Underwriters, of an accounting, financial or
statistical nature (which is limited to accounting, financial or statistical
information derived from the general accounting records of the Company)
included in the Prospectus and not covered by their first letter delivered
pursuant to Section 5(a), agrees with the accounting records of the Company and
its subsidiaries, excluding any questions of legal interpretations.
<PAGE> 25
SCHEDULE III
[FORM OF OPINION OF JAMES V. DERRICK, JR., ESQ.,
TO BE DELIVERED PURSUANT TO SECTION 5(f)]
(i) The Company is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Oregon and has full
corporate power and authority to own its properties and to conduct its business
as such business is described in the Prospectus;
(ii) Each of the Company's material subsidiaries is a corporation duly
incorporated and validly existing in good standing under the laws of its
jurisdiction of incorporation, and has full corporate power and authority to
own its properties and to conduct its business as such business is described in
the Prospectus;
(iii) The Underwriting Agreement has been duly authorized, executed
and delivered by the Company;
(iv) The Indenture has been duly authorized and validly executed,
acknowledged and delivered by the Company and, assuming due authorization,
execution and delivery by the Trustee, constitutes a valid and binding
agreement of the Company enforceable in accordance with its terms, subject, as
to enforcement, to bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or similar laws relating to or affecting creditors' rights
generally and to general equity principles;
(v) In the event any of the Purchased Securities are to be purchased
pursuant to Delayed Delivery Contracts, each of such Delayed Delivery Contracts
has been duly authorized, executed and delivered by the Company and, assuming
due authorization, execution and delivery by the purchaser named therein,
constitutes a valid and binding agreement of the Company enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or similar laws
relating to or affecting creditors' rights generally and to general equity
principles;
(vi) In the event any of the Purchased Securities are Debt Securities,
the Purchased Securities are in the form contemplated by the Indenture and have
been duly authorized by all necessary corporate action on the part of the
Company; the Purchased Securities or, if this Agreement provides for sales of
Debt Securities pursuant to delayed delivery contracts, the Underwriters'
Securities, when executed and authenticated as specified in the Indenture
(which facts, such counsel may state, such counsel has not determined by an
inspection of individual Purchased Securities or, if this Agreement provides
for sales of Debt Securities pursuant to Delayed Delivery Contracts, the
Underwriters' Securities) and issued and delivered against payment pursuant to
the Underwriting Agreement, will
<PAGE> 26
be valid and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
respective terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting creditors'
rights generally and to general equity principles; the Contract Securities, if
any, when executed, authenticated, issued and delivered pursuant to the
Indenture and delayed delivery contracts, if any, will be valid and binding
obligations of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization, moratorium or similar
laws relating to or affecting creditors' rights generally and to general equity
principles.
(vii) In the event any of the Purchased Securities are Equity
Securities, the shares of Purchased Securities delivered on such Closing Date
and all other outstanding shares of the [Title of Securities] of the Company
have been duly authorized and validly issued, are fully paid and nonassessable,
conform to the description thereof contained in the Prospectus, are listed on
the New York, Midwest and Pacific Stock Exchanges and registered under the
Exchange Act; and the stockholders of the Company have no preemptive rights
with respect to the Purchased Securities;
(viii) The Indenture, the Purchased Securities and the Delayed
Delivery Contracts, if any, conform in all material respects to the
descriptions thereof in the Prospectus;
(ix) The Indenture has been qualified under the Trust Indenture Act;
(x) The Registration Statement has become effective under the
Securities Act and, to such counsel's knowledge and information, no stop order
suspending the effectiveness of the Registration Statement has been issued
under the Securities Act and no proceedings therefor have been initiated or
threatened by the Commission;
(xi) The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to the Closing
Date (except for the reports of experts pertaining to natural resource reserves
and the financial statements and other financial data included therein, as to
which such counsel need express no opinion, and exclusive of the documents
incorporated by reference therein) comply as to form in all material respects
with the requirements of the Securities Act and the Trust Indenture Act and the
rules and regulations thereunder;
(xii) Each document filed with the Commission pursuant to the Exchange
Act (except for the reports of experts pertaining to natural resource reserves
and the financial statements and other financial data included in the
Prospectus, as to which such counsel need express no opinion) which is
incorporated by reference in the Prospectus complied as to form, when so filed,
in all material respects with the requirements of the particular form of the
Commission upon which it was filed;
-2-
<PAGE> 27
(xiii) The execution and delivery of the Underwriting Agreement, each
of the Delayed Delivery Contracts, if any, and the Indenture and the
consummation of the transactions therein contemplated and the compliance with
the terms of the Underwriting Agreement, each of the Delayed Delivery
Contracts, if any, and the Indenture do not and will not conflict with, violate
or result in a breach of any of the terms or provisions of, or constitute a
default under, the Restated Certificate of Incorporation, as amended, or
By-laws, as amended, of the Company or any material subsidiary, or any
indenture, mortgage or, to such counsel's knowledge, other agreement to which
the Company or any such subsidiary is a party or by which any of the property
or assets of any of them is subject, or any existing applicable law, rule,
regulation, judgment, order or decree of any domestic government, governmental
instrumentality or court known to such counsel and having jurisdiction over the
Company or any such subsidiary or any of their respective properties;
(xiv) To such counsel's knowledge, no action, suit or proceeding at
law or in equity, or before or by any federal, state or other commission, board
or administrative agency, is pending or threatened against the Company or any
of the Company's material subsidiaries which would be required to be described
in the Prospectus and is not described as required;
(xv) The Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended; and
(xvi) The Company is not subject to, or is exempt from, regulation as
a "holding company" under the Public Utility Holding Company Act of 1935, as
amended.
Such counsel's opinion shall also state that: Members of such
counsel's legal staff, acting under such counsel's direction and supervision,
have participated in the preparation of the Registration Statement and the
Prospectus and discussed with management of the Company and representatives of
its accountants the contents of the Registration Statement and the Prospectus.
Although such counsel has not independently verified, and is not passing upon
and does not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained therein, nothing has come to such
counsel's attention that has caused him to believe that the Registration
Statement (except for the reports of experts pertaining to natural resource
reserves and the financial statements and other financial data included in the
Registration Statement, as to which such counsel need express no belief)
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus (except for the reports of experts
pertaining to natural resource reserves and the financial statements and other
financial data included in the Prospectus, as to which such counsel need
express no belief), at the date of the prospectus supplement relating to the
Purchased Securities filed pursuant to Rule 424 under the Securities Act or at
the Closing Date contained or contains an untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to
-3-
<PAGE> 28
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
In rendering the opinion expressed in paragraph (xiv) above, such
counsel may state that such counsel has only reviewed the files and records of
the Company and consulted with certain senior officers of the Company.
In rendering the opinion expressed in paragraphs (iii) and (v) above,
such counsel may rely, as to all matters of New York law, upon the opinion of
Bracewell & Patterson, L.L.P. dated the Closing Date and delivered pursuant to
Section 5(g) of the Underwriting Agreement.
-4-
<PAGE> 29
SCHEDULE IV
[FORM OF OPINION OF COUNSEL FOR
SELLING STOCKHOLDERS TO BE DELIVERED
PURSUANT TO SECTION 5(j)]
(i) Each Selling Stockholder had good and valid title to the
shares of Purchased Securities sold by such Selling Stockholder free and clear
of all liens, encumbrances, equities or claims and had full right, power and
authority to sell, assign, transfer and deliver such shares of Purchased
Securities; and the several Underwriters have acquired good and valid title to
the shares of Purchased Securities purchased by them from each Selling
Stockholder pursuant to the Underwriting Agreement free and clear of all liens,
encumbrances, equities or claims;
(ii) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required to be obtained
or made by any Selling Stockholder for the consummation of the transactions
contemplated by the Underwriting Agreement in connection with the sale of the
shares of Purchased Securities sold by each Selling Stockholder, except such as
have been obtained and made under the Securities Act and such as may be
required under state securities laws;
(iii) The execution, delivery and performance of the Underwriting
Agreement and the consummation of the transactions herein contemplated will not
result in a breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order of any
governmental agency or body or any court having jurisdiction over any Selling
Stockholder or any of their properties or any agreement or instrument to which
any Selling Stockholder is a party or by which any Selling Stockholder is bound
or to which any of the properties of any Selling Stockholder is subject, or the
charter or by-laws of any Selling Stockholder which is a corporation; and
(iv) The Underwriting Agreement has been duly authorized, executed
and delivered by each Selling Stockholder.
<PAGE> 1
================================================================================
Enron Corp.
and
Harris Trust and Savings Bank,
Trustee
______________
Third Supplemental Indenture
Dated as of September 1, 1997
______________
SUPPLEMENTAL INDENTURE TO INDENTURE DATED AS OF NOVEMBER 1, 1985
================================================================================
<PAGE> 2
THIRD SUPPLEMENTAL INDENTURE, dated as of September 1, 1997, between
ENRON CORP., a corporation duly organized and existing under the laws of the
State of Oregon (herein called the "Company"), having its principal office at
1400 Smith Street, Houston, Texas 77002, and HARRIS TRUST and SAVINGS BANK, a
corporation duly organized and existing under the laws of the State of Illinois
(herein called the "Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has heretofore executed and delivered to the
Trustee its Indenture, dated as of November 1, 1985 (herein called the
"Original Indenture"), to provide for the issuance of its unsecured debentures,
notes or other evidences of indebtedness ("Securities"); and
WHEREAS, the Original Indenture has been supplemented and amended as
of December 1, 1995 to authorize a series of Securities denominated the
Company's "6 1/4% Exchangeable Notes due December 13, 1998" and as of May 8,
1997 to evidence the succession of the Company to Enron Corp., a Delaware
corporation ("Enron Delaware"), and the assumption by the Company of the
obligations of Enron Delaware for the due and punctual payment of the principle
of, premium, if any, and interest on the Securities and the performance and
observance of all covenants and conditions of the Original Indenture on the
part of Enron Delaware to be performed or observed by Enron Delaware (the
Original Indenture, as so supplemented and amended, is herein called the
"Indenture"); and
WHEREAS, Section 901 of the Indenture provides that, subject to
certain limitations, without the consent of any holders of the Securities, the
Company, when authorized by a resolution of its Board of Directors, and the
Trustee may at any time and from time to time enter into an indenture or
indentures supplemental to the Indenture; and
WHEREAS, the Company's Board of Directors has duly authorized the
substance of the modifications of the Indenture hereinafter set forth (the
"Third Supplemental Indenture") and the execution and delivery of this Third
Supplemental Indenture; and
WHEREAS, the Company and the Trustee desire to execute this Third
Supplemental Indenture; and
WHEREAS, all things necessary to make this Third Supplemental
Indenture a valid agreement of the Company, in accordance with its terms, have
been done.
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:
<PAGE> 3
For and in consideration of the premises, it is mutually covenanted
and agreed, for the equal and proportionate benefit of all Holders of the
Securities, as follows:
1. The Indenture shall be modified as follows. Brackets indicate
matters to be deleted and italics indicate matters to be added.
a. Article I. Definitions and Other Provisions of
General Application. shall be amended to include the following:
SECTION 114. Interest Limitation.
It is the intention of the Company to conform
strictly to all applicable usury laws and any subsequent
revisions, repeals or judicial interpretations thereof.
Accordingly, if the transactions contemplated hereby would be
usurious under any applicable law then, in that event,
notwithstanding anything to the contrary in the Securities or
this Indenture, it is agreed as follows: (i) the aggregate of
all consideration which constitutes interest under applicable
law with respect to a Security shall under no circumstances
exceed the maximum amount allowed by applicable law, and any
excess shall be credited to the principal amount of such
Security (or, if the principal amount of such Security shall
have been paid in full, refunded to the Company), to the
extent permitted by applicable law; and (ii) in the event that
the maturity of any Security is accelerated or in the event of
any redemption of such Security, then such consideration that
constitutes interest under applicable law may never include
more than the maximum amount allowed by applicable law, and
any excess shall be credited to the principal amount of such
Security (or, if the principal amount of such Security shall
be paid in full, refunded to the Company), to the extent
permitted by applicable law. All calculations made to compute
the rate of interest with respect to a Security for the
purpose of determining whether such rate exceeds the maximum
amount allowed by applicable law shall be made, to the extent
permitted by such applicable law, by allocating and spreading
during the period of the full stated term of such Security all
interest any time contracted for, taken, reserved, charged or
received by such Holder or by the Trustee on behalf of any
such Holder in connection therewith so that the amount or rate
of interest charged for any and all periods of time during the
term of the Security does not exceed the maximum amount or
rate of interest allowed to be charged by law during the
relevant period of time. Notwithstanding any of the
foregoing, if at any time applicable laws shall be changed so
as to permit a higher rate or amount of interest to be charged
than that permitted
-2-
<PAGE> 4
prior to such change, then unless prohibited by law,
references in this Indenture or any Security to "applicable
law" when used in the context of determining the maximum
interest or rate of interest that can be charged shall be
deemed to refer to such applicable law as so amended to allow
the greater amount or rate of interest.
The right to accelerate maturity of any Security does
not include the right to accelerate any interest which has not
otherwise accrued to the date of such acceleration, provided,
however, that the foregoing shall not prohibit the continuing
accrual after acceleration of interest in accordance with the
terms of the Indenture and such Security.
b. Section 203. Form of Reverse of Security. shall be
amended by deleting the eleventh unnumbered paragraph thereof and
substituting therefor the following:
No reference herein to the Indenture and no provision
of this Security or of the Indenture shall, without the
consent of the Holder, alter or impair the right of the
Holder, which is absolute and unconditional, to receive
payment of principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or
currency, herein prescribed, except for Section 114 of the
Indenture (which limits interest to the maximum amount
permissible by law), the provisions of which are incorporated
herein by reference.
c. The text (but not the caption) of Section 301.
Amount Unlimited; Issuable in Series. shall be amended by deleting
such text in its entirety and substituting therefor the following:
The aggregate principal amount of Securities which
may be authenticated and delivered under this Indenture is
unlimited.
The Securities may be issued in one or more series.
There shall be established in or pursuant to a Board
Resolution and set forth in an Officers' Certificate, or
established in one or more indentures supplemental hereto,
prior to the issuance of Securities of any series,
(1) the title of the Securities of the
series (which shall distinguish the Securities of the
series from Securities of any other series);
-3-
<PAGE> 5
(2) any limit upon the aggregate principal
amount of the Securities of the series which may be
authenticated and delivered under this indenture
(except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Securities of the series
pursuant to Section 304, 305, 306, 906 or 1107 and
except for any Securities which, pursuant to Section
303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a
Security of the series shall be payable, if other
than the Person in whose name that Security (or one
or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such
interest;
(4) the date or dates on which the
principal of and any premium on the Securities of the
series is payable;
(5) the rate or rates (which may be
fixed or variable), or the method by which such rate
or rates shall be determined, at which the Securities
of the series shall bear interest, if any, the date
or dates from which such interest shall accrue, or
the method by which such date or dates shall be
determined, the Interest Payment Dates on which any
such interest shall be payable and the Regular Record
Date for any interest payable on any Interest Payment
Date;
(6) the place or places where the
principal of and any premium and interest on
Securities of the series shall be payable;
(7) the period or periods within which,
the price or prices at which and the terms and
conditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the
Company, if the Company is to have that option;
(8) the obligation, if any, and the
option, if any, of the Company to redeem, purchase or
repay Securities of the series pursuant to any
sinking fund or analogous provisions or at the option
of a Holder thereof and the period or periods within
which, the price or prices at which and the terms and
conditions upon which Securities of the series shall
be redeemed, purchased or repaid, in whole or in
part, pursuant to such obligation or option;
-4-
<PAGE> 6
(9) if other than denominations of
$1,000 and any integral multiple thereof, the
denominations in which Securities of the series shall
be issuable;
(10) the currency, currencies or currency
units in which payment of the principal of and any
premium and interest on any Securities of the series
shall be payable if other than the currency of the
United States of America and the manner of
determining the equivalent thereof in the currency of
the United States of America for purposes of the
definition of "Outstanding" in Section 101;
(11) if the amount of payments of
principal of or any premium or interest on any
Securities of the series may be determined with
reference to an index, including, but not limited to
an index based on a currency or currencies other than
that in which the Securities of that series are
payable, or any other type of index, the manner in
which such amounts shall be determined;
(12) if the principal of or any premium
or interest on any Securities of the series is to be
payable, at the election of the Company or a Holder
thereof, in one or more currencies or currency units
other than that or those in which the Securities are
stated to be payable, the currency, currencies or
currency units in which payment of the principal of
and any premium and interest on Securities of such
series as to which such election is made shall be
payable, and the periods within which and the terms
and conditions upon which such election is to be
made;
(13) if other than the principal amount
thereof, the portion of the principal amount of
Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof
pursuant to Section 502 or provable in bankruptcy
pursuant to Section 504 or the method by which such
portion shall be determined;
(14) any trustees, paying agents,
transfer agents or registrars with respect to
Securities of such series;
(15) whether the Securities of the series
shall be issued upon original issuance in whole or in
part in the form of one or more
-5-
<PAGE> 7
Global Securities and, in such case, (a) the
Depository with respect to such Global Security or
Securities, which Depository at the time of
designation and at all times while it serves as
Depository shall be a clearing agency registered
under the Securities Exchange Act of 1934, as
amended; and (b) the circumstances under which any
such Global Security may be exchanged for Securities
registered in the name of, and any transfer of such
Global Security may be registered to, a Person other
than such Depository or its nominee, if other than as
set forth in Section 305;
(16) the obligation, if any, of the
Company to permit the conversion or exchange of
Securities of such series into other securities
(whether or not issued by, or the obligation of, the
Company), and the terms and conditions upon which
such conversion or exchange shall be effected
(including without limitation, the initial conversion
or exchange price or rate, the conversion or exchange
period and any other provisions in addition to or in
lieu of those set forth in this Indenture relative to
such obligation); and
(17) any other terms of the series (which
terms shall not be inconsistent with the provisions
of this Indenture, except as permitted by Section
901(5)).
All Securities of any one series shall be
substantially identical except as to denomination and except
as may otherwise be provided in or pursuant to the Board
Resolution referred to above and set forth, or determined in
the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by
action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of the series.
d. Section 303. Execution, Authentication, Delivery and
Dating, shall be amended by adding the following paragraph after the
fourth unnumbered paragraph:
Notwithstanding the provisions of Section 301 and of
the preceding paragraph, if all Securities of a series are not
to be originally issued at one
-6-
<PAGE> 8
time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 301 or the
Company Order otherwise required pursuant to such preceding
paragraph at or prior to the time of authentication of each
Security of such series if such documents are delivered at or
prior to the authentication upon original issuance of the
first Security of such series to be issued.
e. Section 303. Execution, Authentication, Delivery and
Dating. shall be further amended by deleting the last paragraph
thereof and substituting therefor the following:
No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose
unless there appears on such Security a certificate of
authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such
certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly
authenticated and delivered hereunder and is entitled to the
benefits of the Indenture. Notwithstanding the foregoing, if
any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Company, and the
Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309, together with a
written statement (which need not comply with Section 102 and
need not be accompanied by an Opinion of Counsel) stating that
such Security has never been issued and sold by the Company,
for all purposes of this Indenture such Security shall be
deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this
Indenture.
2. Capitalized terms used herein but not defined herein shall
have the meanings given to them in the Indenture.
3. Except as specifically supplemented and amended by this Third
Supplemental Indenture, the terms and provisions of the Indenture shall remain
in full force and effect.
4. The Recitals of the Company preceding Section 1 of this Third
Supplemental Indenture are statements of the Company and the Trustee has no
responsibility for the accuracy or completeness thereof.
5. This Third Supplemental Indenture shall be governed by, and
construed in accordance with, the law of the State of Texas.
-7-
<PAGE> 9
6. This Third Supplemental Indenture may be executed in
one or more counterparts, all of which, taken together, shall
constitute one and the same Third Supplemental Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed, all as of the day and year first
above written.
ENRON CORP.
By
------------------------------------------
Name:
Title:
HARRIS TRUST AND SAVINGS BANK,
as Trustee
By
------------------------------------------
Name:
Title:
-8-
<PAGE> 1
EXHIBIT 5
September 12, 1997
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Gentlemen:
As Senior Vice President and General Counsel of Enron Corp., an Oregon
corporation ("Enron"), I am familiar with the Registration Statement of Enron
on Form S-3 and Post-Effective Amendment No. 3 to Registration Statement No.
33-53877 (collectively, the "Registration Statement") relating to the proposed
offering from time to time of (i) up to an aggregate amount of $1,000,000,000
of Enron Debt Securities, Enron Stock Warrants, Enron Preferred Stock and
Depositary Shares, and (ii) up to 7.5 million shares of Enron Common Stock, no
par value (the Debt Securities, Preferred Stock, Depositary Shares, Stock
Warrants and Common Stock collectively referred to herein as the "Securities").
In connection therewith, I have examined, among other things, a copy of the
Amended and Restated Articles of Incorporation and Bylaws of Enron, the
corporate proceedings taken to date with respect to the authorization, issuance
and sale of the Securities, a copy of the Indenture dated as of November 1,
1985, as supplemented (the "Indenture"), between Enron and Harris Trust and
Savings Bank, Trustee, and the forms of certain other agreements to be entered
into by Enron, and I have performed such other investigations as I have
considered appropriate as the basis for the opinions expressed herein.
Capitalized terms used but not defined herein are used as defined in the
Registration Statement.
Based on the foregoing, I am of the opinion that:
(1) Enron is a corporation duly organized, validly existing and in
good standing under the laws of the State of Oregon.
(2) The Debt Securities of Enron have been validly authorized for
issuance, and (subject to the Registration Statement becoming effective and any
applicable state securities or Blue Sky laws being complied with), when the
terms thereof and their issue and sale have been duly established, upon
issuance and delivery thereof as set forth in the Registration Statement, and
upon receipt by Enron of the purchase price thereof, the Debt Securities will
be validly issued and will be binding obligations of Enron.
(3) When (a) the terms of the series of Preferred Stock and their
issue and sale have been duly established, and (if applicable) a deposit
agreement has been duly authorized, executed and delivered by Enron and a
Depositary, in each case in conformity with Enron's Amended and Restated
Articles of Incorporation and Oregon law, (b) a certificate of designations
with respect to such series
<PAGE> 2
Enron Corp.
September 12, 1997
Page 2
- --------------------
of the Preferred Stock has been duly filed with the Secretary of State of the
State of Oregon, (c) the Registration Statement has become effective and any
applicable state securities or Blue Sky laws have been complied with, (d) the
shares of such series have been issued, and (if applicable) Depositary Receipts
have been delivered as set forth in the Registration Statement, and (e) Enron
has received the purchase price of such shares in accordance with the terms of
their issue and sale, the shares of such series of Preferred Stock and (if
applicable) the related Depositary Shares will be validly issued, fully paid
and nonassessable.
(4) The issuance of the Common Stock to be issued by Enron has
been duly authorized, and (subject to the Registration Statement becoming
effective and applicable Blue Sky laws being complied with), when the terms of
their issue and sale have been duly established, upon the issuance and delivery
thereof as set forth in the Registration Statement, and upon the receipt by
Enron of the purchase price thereof, the Common Stock will be validly issued,
fully paid and nonassessable.
(5) The Stock Warrants have been validly authorized for issuance,
and (subject to the Registration Statement becoming effective and any
applicable state securities or Blue Sky laws being complied with), when the
terms thereof and their issue and sale have been duly established, upon
issuance and delivery thereof as set forth in the Registration Statement, and
upon receipt by Enron of the purchase price thereof, the Stock Warrants will be
validly issued and will be binding obligations of Enron.
I am a member of the bar of the State of Texas. The opinion set forth
above is limited in all respects to the laws of the State of Texas, the General
Corporation Law of the State of Oregon and federal law.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to me under the caption "Validity
of Securities" in the Prospectus constituting part of the Registration
Statement and to the filing of this opinion as an exhibit thereto. By giving
such consent I do not admit that I am an expert with respect to any part of the
Registration Statement, including this exhibit, within the meaning of the term
"expert" as used in the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission issued thereunder.
Very truly yours,
/s/ James V. Derrick, Jr.
<PAGE> 1
Exhibit 12
ENRON CORP. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO
COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
(In Millions)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Year Ended December 31,
Ended ----------------------------------------------------------
6/30/97 1996 1995 1994 1993 1992
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earnings available for fixed charges
Net income (loss) $(198) $ 584 $ 520 $ 453 $333 $329
Less:
Undistributed earnings and
losses of less than 50% owned
affiliates (11) (39) (14) (9) (20) (33)
Capitalized interest of
nonregulated companies (7) (10) (8) (9) (26) (66)
Add:
Fixed charges (a) 251 454 436 487 471 452
Minority interests 36 75 27 30 28 18
Income tax expense (benefit) (125) 297 310 190 148 88
--------------------------------------------------------------------------
Total $ (54) $1,361 $1,271 $1,142 $934 $788
==========================================================================
Preferred dividend requirements $ 39 $ 50 $ 48 $ 35 $ 19 $ 22
Ratio of income before provision
for income taxes to net income (b) 1.69 1.46 1.55 1.37 1.41 1.28
Preferred dividend factor on a
pretax basis 66 73 74 48 27 28
Fixed charges
Interest expense (a) 226 404 386 445 436 430
Rental expense representative of
interest factor 25 50 50 42 35 22
--------------------------------------------------------------------------
Total $ 317 $ 527 $ 510 $ 535 $498 $480
==========================================================================
Ratio of earnings to combined fixed
charges and preferred dividends (c) 2.58 2.49 2.13 1.88 1.64
==========================================================================
</TABLE>
(a) Amounts exclude costs incurred on sales of accounts receivables.
(b) Represents net income before provision for income taxes dividend by net
income, which adjusts dividends on preferred stock to a pretax basis.
(c) For the six months ended June 30, 1997, earnings were inadequate to cover
combined fixed charges and preferred stock dividends by $371 million.
<PAGE> 1
Exhibit 23.01
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our reports dated February 17,
1997 included in Enron Corp.'s Form 8-K dated March 17, 1997 and Form 10-K for
the year ended December 31, 1996 and to all references to our Firm included in
this Registration Statement.
ARTHUR ANDERSEN LLP
Houston, Texas
September 11, 1997
<PAGE> 1
Exhibit 23.02
DeGolyer and MacNaughton
One Energy Square
Dallas, Texas 75206
September 12, 1997
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Gentlemen:
In connection with the Registration Statement on Form S-3 (the Registration
Statement), to be filed with the Securities and Exchange Commission on or about
September 12, 1997, by Enron Corp., DeGolyer and MacNaughton hereby consents to
the incorporation in said Registration Statement of the references to our firm
and to the opinions delivered to Enron Oil & Gas Company (the Company) regarding
our comparison of estimates prepared by us with those furnished to us by the
Company of the proved oil, condensate, natural gas liquids, and natural gas
reserves of certain selected properties owned by the Company. The opinions are
contained in our letter reports dated January 13, 1995, January 22, 1996, and
January 17, 1997, for estimates, as of January 1, 1995, December 31, 1995, and
December 31, 1996, respectively. The opinions are referred to in the section
"Oil and Gas Exploration and Production Properties and Reserves - Reserve
Information" in Enron Corp.'s Annual Report on Form 10-K for the year ended
December 31, 1996, and in Note 19 to the Enron Corp. consolidated financial
statements included in Enron Corp.'s Form 10-K for the year ended December 31,
1996. DeGolyer and MacNaughton also consents to the incorporation by reference
in the Registration Statement of its letter report, dated January 17, 1997,
addressed to the Company, which is included as Exhibit 23.03 to Enron Corp.'s
Annual Report on Form 10-K for the year ended December 31, 1996. DeGolyer and
MacNaughton also consent to the references to us in the section "Experts" in the
Prospectus that is a part of the Registration Statement.
Very truly yours,
/s/ DeGOLYER and MacNAUGHTON
<PAGE> 1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ ROBERT A. BELFER
--------------------
Robert A. Belfer
<PAGE> 2
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ NORMAN P. BLAKE, JR.
------------------------
Norman P. Blake, Jr.
<PAGE> 3
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JOHN H. DUNCAN
------------------
John H. Duncan
<PAGE> 4
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JOE H. FOY
--------------
Joe H. Foy
<PAGE> 5
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), her true and lawful attorney-in-fact and agent, for
her and on her behalf and in her name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set her hand this 29th
day of August, 1997.
/s/ WENDY L. GRAMM
------------------
Wendy L. Gramm
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ ROBERT K. JAEDICKE
----------------------
Robert K. Jaedicke
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ KENNETH L. LAY
------------------
Kenneth L. Lay
<PAGE> 8
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ CHARLES A. LeMAISTRE
------------------------
Charles A. LeMaistre
<PAGE> 9
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JEROME J. MEYER
-------------------
Jerome J. Meyer
<PAGE> 10
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JEFFREY K. SKILLING
-----------------------
Jeffrey K. Skilling
<PAGE> 11
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JOHN A. URQUHART
-------------------------
John A. Urquhart
<PAGE> 12
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ JOHN WAKEHAM
----------------
John Wakeham
<PAGE> 13
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ CHARLS S. WALKER
--------------------
Charls S. Walker
<PAGE> 14
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ BRUCE G. WILLISON
---------------------
Bruce G. Willison
<PAGE> 15
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that in connection with the proposed
registration by Enron Corp., an Oregon corporation (the "Company"), of Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and Warrants to
purchase Common Stock of the Company, the undersigned officer or director of
the Company hereby constitutes and appoints Kenneth L. Lay, Richard A. Causey,
Andrew S. Fastow, and Peggy B. Menchaca, and each of them (with full power to
each of them to act alone), his true and lawful attorney-in-fact and agent, for
him and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute and file a registration statement on Form S-3
relating to such securities to be filed with the Securities and Exchange
Commission, together with all amendments thereto, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as the undersigned might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereto set his hand this 29th
day of August, 1997.
/s/ HERBERT S. WINOKUR, JR.
---------------------------
Herbert S. Winokur, Jr.
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
Statement of Eligibility
Under the Trust Indenture Act of 1939
of a Corporation Designated to Act as
Trustee
Check if an Application to Determine
Eligibility of a Trustee Pursuant to Section
305(b)(2) _______________
HARRIS TRUST AND SAVINGS BANK
(Name of Trustee)
<TABLE>
<S> <C>
Illinois 36-1194448
(State of Incorporation) (I.R.S. Employer Identification No.)
</TABLE>
111 West Monroe Street; Chicago, Illinois 60603
(Address of principal executive offices)
Frank A. Pierson, Harris Trust and Savings Bank,
111 West Monroe Street, Chicago, Illinois, 60603
312-461-2533
(Name, address and telephone number for agent for service)
ENRON CORP.
(Name of obligor)
<TABLE>
<S> <C>
Delaware 47-0255140
(State of Incorporation) (I.R.S. Employer Identification No.)
</TABLE>
1400 Smith Street
Houston, Texas 77002
(Address of principal executive offices)
Debt Securities
(Title of indenture securities)
<PAGE> 2
1. GENERAL INFORMATION. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Commissioner of Banks and Trust Companies, State of Illinois,
Springfield, Illinois; Chicago Clearing House Association, 164
West Jackson Boulevard, Chicago, Illinois; Federal Deposit
Insurance Corporation, Washington, D.C.; The Board of
Governors of the Federal Reserve System,Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Harris Trust and Savings Bank is authorized to exercise
corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the
Trustee, describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
3. thru 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee is now in
effect which includes the authority of the trustee to commence
business and to exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between
Harris Trust and Savings Bank, HTS Bank and Harris Bankcorp, Inc.
which constitutes the articles of association of the Trustee as
now in effect and includes the authority of the Trustee to
commence business and to exercise corporate trust powers was filed
in connection with the Registration Statement of Louisville Gas
and Electric Company, File No. 2-44295, and is incorporated herein
by reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in
connection with the Registration Statement of Commercial Federal
Corporation, File No. 333-20711, and is incorporated herein by
reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 2 of this statement)
4. A copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or
examining authority.
(included as Exhibit B on page 3 of this statement)
1
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, has duly caused this statement of eligibility to
be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago, and State of Illinois, on the 9TH day of September, 1997.
HARRIS TRUST AND SAVINGS BANK
By: /s/ FRANK A. PIERSON
--------------------------------
Frank A. Pierson
Vice President
EXHIBIT A
The consents of the trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents
that reports of examinations of said trustee by Federal and State authorities
may be furnished by such authorities to the Securities and Exchange Commission
upon request therefor.
HARRIS TRUST AND SAVINGS BANK
By: /s/ FRANK A. PIERSON
--------------------------------
Frank A. Pierson
Vice President
2
<PAGE> 4
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of March 31, 1997, as published in accordance with a
call made by the State Banking Authority and by the Federal Reserve Bank of the
Seventh Reserve District.
[LOGO] HARRIS BANK
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on March 31, 1997, a state banking institution organized and operating
under the banking laws of this State and a member of the Federal Reserve
System. Published in accordance with a call made by the Commissioner of Banks
and Trust Companies of the State of Illinois and by the Federal Reserve Bank of
this District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION>
THOUSANDS
OF DOLLARS
<S> <C> <C>
ASSETS
Cash and balances due from depository institutions:
Non-interest bearing balances and currency and coin........... $1,594,951
Interest bearing balances..................................... $620,847
Securities:
a. Held-to-maturity securities $0
b. Available-for-sale securities $3,674,321
Federal funds sold and securities purchased under agreements to resell in
domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold............................................ $447,375
Securities purchased under agreements to resell............... $0
Loans and lease financing receivables:
Loans and leases, net of unearned income...................... $8,499,011
LESS: Allowance for loan and lease losses.................... $110,978
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Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b)................................ $8,388,033
Assets held in trading accounts............................................ $126,309
Premises and fixed assets (including capitalized leases)................... $188,993
Other real estate owned.................................................... $446
Investments in unconsolidated subsidiaries and associated companies........ $53
Customer's liability to this bank on acceptances outstanding............... $66,859
Intangible assets.......................................................... $292,918
Other assets............................................................... $495,997
-----------
TOTAL ASSETS $15,897,102
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</TABLE>
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<TABLE>
<S> <C> <C>
LIABILITIES
Deposits:
In domestic offices.................................................... $8,252,773
Non-interest bearing............................................... $3,414,150
Interest bearing................................................... $4,838,623
In foreign offices, Edge and Agreement subsidiaries, and IBF's........ $1,989,792
Non-interest bearing............................................... $54,391
Interest bearing................................................... $1,935,401
Federal funds purchased and securities sold under agreements to repurchase
in domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds purchased & securites sold under agreements to
repurchase....................................................... $2,896,616
Trading Liabilities........................................................ 81,381
Other borrowed money:
a. With remaining maturity of one year or less............................ $991,442
b. With remaining maturity of more than one year.......................... $0
Bank's liability on acceptances executed and outstanding................... $66,859
Subordinated notes and debentures.......................................... $310,000
Other liabilities.......................................................... $138,427
-----------
TOTAL LIABILITIES $14,727,290
===========
EQUITY CAPITAL
Common stock............................................................... $100,000
Surplus.................................................................... $600,566
a. Undivided profits and capital reserves................................. $519,518
b. Net unrealized holding gains (losses) on available-for-sale
securities........................................................... ($50,272)
-----------
TOTAL EQUITY CAPITAL....................................................... $1,169,812
===========
Total liabilities, limited-life preferred stock, and equity capital........ $15,897,102
===========
</TABLE>
I, Steve Neudecker, Vice President of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
STEVE NEUDECKER
4/30/97
We, the undersigned directors, attest to the correctness of this
Report of Condition and declare that it has been examined by us and, to the
best of our knowledge and belief, has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
the Commissioner of Banks and Trust Companies of the State of Illinois and is
true and correct.
EDWARD W. LYMAN,
ALAN G. McNALLY,
MARIBETH S. RAHE
Directors.
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