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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 1, 2000
REGISTRATION NO. 333-70465
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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ENRON CORP.
(Exact name of Registrant as specified in its charter)
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OREGON 47-0255140
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification No.)
organization)
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REX R. ROGERS
VICE PRESIDENT AND ASSOCIATE GENERAL COUNSEL
ENRON CORP.
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)
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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. [ ]
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CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED TO BE REGISTERED PER SECURITY PRICE REGISTRATION FEE
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Enron Corp. Common Stock....... 7.5 million shares(*) (*) (*) (*)
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(*) Pursuant to Rule 416(b) under the Securities Act of 1933, this
Post-Effective Amendment No. 1 reflects the registration of an additional
7.5 million shares of Enron Corp. Common Stock issuable as a result of a
two-for-one stock split effected on August 13, 1999 by means of a dividend
of one share of Enron Corp. Common Stock for each issued share of Common
Stock. No additional registration fee is required pursuant to Rule 416(b) in
connection with the additional securities deemed registered hereunder as a
result of such stock split.
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 416(B) UNDER THE SECURITIES ACT OF 1933, THIS
POST-EFFECTIVE AMENDMENT NO. 1 REFLECTS THE REGISTRATION OF AN ADDITIONAL 7.5
MILLION SHARES OF ENRON CORP. COMMON STOCK ISSUABLE AS A RESULT OF A TWO-FOR-ONE
STOCK SPLIT EFFECTED ON AUGUST 13, 1999 BY MEANS OF A DIVIDEND OF ONE SHARE OF
COMMON STOCK FOR EACH ISSUED SHARE OF COMMON STOCK. FORM S-3 REGISTRATION
STATEMENT NO. 333-70465, WHICH WAS DECLARED EFFECTIVE ON FEBRUARY 5, 1999,
INCLUDED THE REGISTRATION OF 13.8 MILLION SHARES OF ENRON CORP. COMMON STOCK (OF
WHICH 7.5 MILLION SHARES REMAIN UNSOLD) AND $1,000,000,000 OF OTHER SECURITIES
(OF WHICH $500,000,000 OF SUCH OTHER SECURITIES REMAIN UNSOLD) (THE "PREVIOUSLY
REGISTERED SECURITIES"). PURSUANT TO THIS POST-EFFECTIVE AMENDMENT NO. 1 TO
REGISTRATION STATEMENT NO. 333-70465, THE TOTAL AMOUNT OF UNSOLD PREVIOUSLY
REGISTERED SECURITIES (OTHER THAN THE 7.5 MILLION SHARES OF ENRON CORP. COMMON
STOCK REMAINING UNSOLD) REGISTERED ON REGISTRATION STATEMENT NO. 333-70465,
WITHOUT LIMITATION AS TO CLASS OF SECURITIES, MAY BE OFFERED AND SOLD AS DEBT
SECURITIES, ENRON CORP. PREFERRED STOCK AND ENRON CORP. DEPOSITARY SHARES,
TOGETHER WITH THE 7.5 MILLION SHARES OF ENRON CORP. COMMON STOCK DEEMED
REGISTERED HEREUNDER PURSUANT TO RULE 416(B), AND UP TO 7.5 MILLION SHARES OF
ENRON CORP. COMMON STOCK PREVIOUSLY REGISTERED AND REMAINING UNSOLD, THROUGH THE
USE OF THE PROSPECTUS INCLUDED HEREIN. IN THE EVENT SUCH PREVIOUSLY REGISTERED
SECURITIES ARE OFFERED AND SOLD PRIOR TO THE EFFECTIVE DATE OF THIS
POST-EFFECTIVE AMENDMENT NO. 1, THE AMOUNT OF SUCH PREVIOUSLY REGISTERED
SECURITIES SO SOLD WILL NOT BE INCLUDED IN THE PROSPECTUS INCLUDED HEREIN.
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EXPLANATORY NOTE
SECURITIES TO BE ISSUED AS A RESULT OF STOCK SPLIT
RULE 416(b)
Enron Corp.'s Registration Statement No. 333-70465 was declared effective
on February 5, 1999, registering, among other securities, 13.8 million shares of
Enron Corp. Common Stock (of which 7.5 million shares remained unsold as of
August 13, 1999, and continue to remain unsold as of the date of this filing).
On August 13, 1999 Enron Corp. effected a two-for-one Common Stock split, by
means of a dividend of one share of Common Stock for each issued share of Common
Stock. Pursuant to Rule 416(b) under the Securities Act of 1933, the additional
7.5 million shares of Enron Corp. Common Stock issuable as a result of such
stock split shall, pursuant to this Post-Effective Amendment No. 1 to
Registration Statement No. 333-70465, be deemed to be included in such
Registration Statement.
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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 MARCH 1, 2000
PROSPECTUS
[ENRON LOGO]
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
ENRON CORP.
1400 Smith Street
Houston, Texas 77002
(713) 853-6161
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We will provide specific terms of these securities in supplements to this
prospectus. This prospectus may not be used to consummate sales of these
securities unless accompanied by a prospectus supplement.
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Neither the SEC nor any state securities commission has approved these
securities or determined if this prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
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March , 2000
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TABLE OF CONTENTS
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Where You Can Find More Information......................... 2
Business of Enron........................................... 3
Use of Proceeds............................................. 4
Ratio of Earnings to Fixed Charges and Earnings to Fixed
Charges and Preferred Stock Dividends..................... 4
Description of Debt Securities.............................. 5
Description of Capital Stock................................ 12
Description of Depositary Shares............................ 20
Plan of Distribution........................................ 22
Validity of Securities...................................... 23
Experts..................................................... 23
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and copy
any document we file at the SEC's public reference rooms in Washington, D.C.,
New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330
for further information on the public reference rooms.
Reports, proxy statements and other information concerning Enron can also
be inspected and copied at the offices of the New York Stock Exchange at 20
Broad Street, New York, New York 10005, the offices of the Chicago Stock
Exchange at 120 South LaSalle Street, Chicago, Illinois 60603, and the offices
of the Pacific Stock Exchange at 301 Pine Street, San Francisco, California
94014.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
until we sell all of the securities.
- Annual Report on Form 10-K for the fiscal year ended December 31, 1998;
- Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999,
June 30, 1999 and September 30, 1999;
- Current Reports on Form 8-K filed January 26, 1999 and March 18, 1999;
and
- The description of Enron's capital stock set forth in Enron's
Registration Statement on Form 8-B filed on July 2, 1997.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address:
Secretary Division, Enron Corp.
1400 Smith Street
Houston, Texas 77002
(713) 853-6161
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. We are not making an
offer of these securities in any state where the offer is not permitted. You
should not assume that the information in this prospectus or any prospectus
supplement is accurate as of any date other than the date on the front of those
documents.
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BUSINESS OF ENRON
Headquartered in Houston, Texas, Enron Corp. provides products and services
related to natural gas, electricity and communications to wholesale and retail
customers. Our operations are conducted through our subsidiaries and affiliates,
which are principally engaged in:
- the marketing of natural gas, electricity and other commodities and
related risk management and finance services worldwide;
- the development, construction and operation of power plants, pipelines
and other energy related assets worldwide;
- the delivery of high bandwidth communication applications throughout the
United States;
- the transportation of natural gas through pipelines to markets throughout
the United States; and
- the generation and transmission of electricity to markets in the
northwestern United States.
WHOLESALE ENERGY OPERATIONS AND SERVICES
Our wholesale energy operations and services businesses operate in North
America, Europe and evolving energy markets in developing countries. These
businesses provide integrated energy-related products and services to wholesale
customers worldwide. Wholesale energy operations and services can be categorized
into two business lines: (a) Commodity Sales and Services and (b) Energy Assets
and Investments.
Commodity Sales and Services. Our commodity sales and services operations
include:
- the purchase, sale, marketing and delivery of natural gas, electricity,
liquids and other commodities;
- the restructuring of existing long-term contracts; and
- the management of our commodity portfolios.
In addition, we provide risk management products and services to energy
customers that hedge movements in price and location-based price differentials.
Our risk management products and services are designed to provide stability to
customers in markets impacted by commodity price volatility. Also included in
this business is the management of certain operating assets that directly relate
to this business, including domestic intrastate pipeline and storage facilities.
Energy Assets and Investments. In the assets and investments business, we
manage and operate a large portfolio of assets related to natural gas,
electricity and communications and offer financing alternatives to customers.
Activities include developing, constructing, operating and managing a large
portfolio of energy assets, including power plants and natural gas pipelines. We
also provide capital to energy and communication customers seeking debt or
equity financing.
Enron Broadband Services provides high quality broadband Internet content
and applications. This business includes the Enron Intelligent Network(TM)
("EIN"), Enron's Broadband Operating System, and bandwidth trading,
intermediation and content services. Enabled with a software control layer, the
EIN provides a bandwidth-on-demand platform to deliver data, applications and
streaming rich media to the desktop. We are minimizing capital deployed in the
development of the EIN through strategic alliances with industry technology
leaders whose presence, customer access, market share and content enable us to
efficiently enter this new, emerging marketplace. We are extending the market
making and risk management skills from our energy business to develop the
bandwidth intermediation business. Content services include premium broadband
content delivery, such as video streaming, high capacity data transport and
video conferencing, that utilize the EIN platform.
RETAIL ENERGY SERVICES
Enron Energy Services is a nationwide provider of energy outsource products
to United States business customers. This includes sales of natural gas and
electricity and energy management services directly to
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commercial and industrial customers, as well as investments in related
businesses. Enron Energy Services provides end-users with a broad range of
energy products and services at competitive prices. These products and services
include energy tariff and information management, demand-side services and
financial services.
TRANSPORTATION AND DISTRIBUTION
Our transportation and distribution business is comprised of our North
American interstate natural gas transportation systems and our electricity
transmission and distribution operations in Oregon.
Interstate Transmission of Natural Gas. Included in our domestic interstate
natural gas pipeline operations are Northern Natural Gas Company, Transwestern
Pipeline Company and Florida Gas Transmission Company (indirectly 50% owned by
our company). Northern, Transwestern and Florida Gas are interstate pipelines
and are subject to the regulatory jurisdiction of the Federal Energy Regulatory
Commission. Each pipeline serves customers in a specific geographical area.
Northern serves the upper Midwest, Transwestern serves principally the
California market and pipeline interconnects on the east end of the Transwestern
system, and Florida Gas serves the State of Florida. In addition, we hold an
interest in Northern Border Partners, L.P., which owns a 70% interest in the
Northern Border Pipeline system. One of our subsidiaries operates the Northern
Border Pipeline system, which transports gas from Western Canada to delivery
points in the midwestern United States.
Electricity Transmission and Distribution Operations. We conduct our
electric utility operations through our wholly-owned subsidiary, Portland
General Electric Company. Portland General is engaged in the generation,
purchase, transmission, distribution and sale of electricity in the State of
Oregon. Portland General also sells energy to wholesale customers throughout the
western United States. Portland General's Oregon service area is approximately
3,170 square miles. At December 31, 1999, Portland General served approximately
719,000 customers. On November 8, 1999, we announced that we have entered into
an agreement to sell Portland General to Sierra Pacific Resources for $2.1
billion, comprised of $2.02 billion in cash and the assumption of our
approximately $80 million Portland General merger payment obligation. Sierra
Pacific Resources will also assume $1 billion in Portland General debt and
preferred stock. The proposed transaction, which is subject to customary
regulatory approvals, is expected to close in late 2000.
USE OF PROCEEDS
The net proceeds from the sale of the offered securities will be added to
our general funds and will be used to repay debt and for general corporate
purposes. Other uses may be stated in a prospectus supplement.
RATIO OF EARNINGS TO FIXED CHARGES
AND EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
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NINE MONTHS
ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, ---------------------------------
1999 1998 1997 1996 1995 1994
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Ratio of Earnings to Fixed Charges............ 2.14 2.08 1.02 3.00 2.92 2.34
Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends................... 2.03 2.03 (a) 2.85 2.76 2.25
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(a) For the year ended December 31, 1997, earnings were inadequate to cover
combined fixed charges and preferred stock dividends by $6 million.
The ratios of earnings to fixed charges and preferred stock dividends are
based on continuing operations. "Earnings" is determined by adding:
- the pre-tax income of Enron and its majority owned subsidiaries,
- Enron's share of pre-tax income of its 50% owned companies,
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- any income actually received from less than 50% owned companies, and
- fixed charges, net of interest capitalized.
"Fixed Charges" represent (1) interest (whether expensed or capitalized), (2)
amortization of debt discount and expense and (3) 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.
DESCRIPTION OF DEBT SECURITIES
The following description highlights the general terms and provisions of
the debt securities. When debt securities are offered in the future, the
prospectus supplement will explain the particular terms of those securities and
the extent to which these general provisions may apply.
The debt securities will be secured or unsecured obligations of Enron. Any
unsecured obligations will be issued under an "Indenture" between Enron and
Harris Trust and Savings Bank, as Trustee, dated as of November 1, 1985, as
supplemented. Any secured obligations will be issued under a separate indenture,
which will be described in the prospectus supplement relating to those debt
securities.
We have summarized selected provisions of the Indenture below. The summary
is not complete. The form of the Indenture has been filed as an exhibit to the
registration statement and you should read the Indenture for any provisions that
may be important to you. In the summary below, we have included references to
section numbers of the Indenture so that you can easily locate these provisions.
Capitalized terms used in the summary have the meanings specified in the
Indenture.
GENERAL
The Indenture does not limit the principal amount of unsecured debentures,
notes or other obligations of Enron (the "Indenture Securities") which we may
issue from time to time in one or more series, and we may issue additional
Indenture Securities (in addition to the debt securities) in the future under
the Indenture. At December 31, 1999, we had approximately $5,145,913,000
principal amount of Indenture Securities issued and outstanding under the
Indenture.
A prospectus supplement relating to any series of debt securities being
offered will include specific terms relating to the offering. These terms will
include some or all of the following:
- The title of the debt securities;
- The total principal amount of the debt securities;
- The date on which the principal of the debt securities is payable;
- The interest rate which the debt securities will bear and the interest
payment dates for the debt securities;
- The place where the principal of (and premium, if any) and interest on
debt securities will be payable;
- Any optional redemption periods and the terms of that option;
- Any sinking fund or other provisions that would obligate us to repurchase
or otherwise redeem the debt securities;
- Any trustees, paying agents, transfer agents or registrars with respect
to debt securities; and
- Any other terms of the debt securities. (Section 301.)
LIMITATIONS ON MORTGAGES AND LIENS
The Indenture provides that so long as any of the Indenture Securities
(including the debt securities) are outstanding, Enron will not, and will not
permit any Subsidiary 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
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Property 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 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:
- 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;
- 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;
- 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;
- 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 (a) exist prior to the time the Acquired Entity becomes a
Subsidiary or (b) 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;
- Pledges of current assets, in the ordinary course of business, to secure
current liabilities;
- Deposits to secure public or statutory obligations;
- Liens to secure indebtedness other than Funded Debt (as defined in the
Indenture and herein);
- Mortgages, pledges, liens or encumbrances upon any office, data
processing or transportation equipment;
- 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;
- 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 Subsidiary of
goods or merchandise to customers; or
- 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
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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 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.)
"Subsidiary" is defined 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 (1) 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; (2) any amount representing
capitalized lease obligations; (3) 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; (4) 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 (5) any guarantees with
respect to lease or other similar periodic payments to be made by other persons.
(Section 101.)
"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 (1) 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
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appliances and equipment sold in the regular course of business or (2) 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 Enron and the Trustee
may modify the Indenture or the rights of the holders of Indenture Securities if
they have the consent of the holders of at least 50% in principal amount of all
outstanding Indenture Securities affected thereby. However, no modification of
the principal or interest payment terms, no modification of provisions
concerning waivers of past defaults or waivers of certain covenants, and no
modification reducing the percentage required for any modifications, is
effective against any holder without its consent. (Section 902.)
EVENTS OF DEFAULT AND RIGHTS UPON DEFAULT
"Event of Default" means any one of the following with respect to any
series of Indenture Securities:
(a) failure to pay interest on any Indenture Security of that series
for 30 days;
(b) failure to deposit any sinking fund payment for 30 days;
(c) failure to pay the principal or any premium on any Indenture
Security of that series when due;
(d) failure to perform any other covenant in the Indenture for 60 days
after being given written notice by the Trustee or the holders of at least
25% in principal amount of all outstanding Indenture Securities; or
(e) certain events in bankruptcy, receivership or other insolvency
proceedings or an assignment for the benefit of creditors. (Section 501.)
An Event of Default for a particular series of Indenture Securities does
not necessarily constitute an Event of Default for any other series of Indenture
Securities issued under the Indenture. A default under other indebtedness of
Enron is not an Event of Default under the Indenture.
If an Event of Default for any series of Indenture Securities occurs and
continues, the Trustee or the holders of at least 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. If an Event of Default described in clause (d) or (e) of the
foregoing paragraph occurs and is continuing, the
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Trustee or the holders of at least 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. (Section 502.) If
this happens, subject to certain conditions, the holders of a majority of the
aggregate 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. 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), (b) or (c) of the
first paragraph under this subheading (or, in the case of a default described in
clause (d) or (e) 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 (1) in the payment of the principal of
(or premium, if any) or interest on any Indenture Security, or (2) in respect of
a covenant or provision of the Indenture which under the Indenture cannot be
modified or amended without the consent of the holder of each outstanding
Indenture Security of such series affected. (Section 513.)
DISCHARGE OF INDENTURE; DEFEASANCE
With certain exceptions, we will be discharged from our obligations under
the Indenture with respect to any series of Indenture Securities by either
paying or causing to be paid the principal of, premium, if any, and interest on
all of the Indenture Securities of such series outstanding, as and when the same
shall become due and payable, or delivering to the Trustee all outstanding
Indenture Securities of such series for cancellation. (Section 401.)
In addition, we will be discharged if at any time we defease the Indenture
Securities of a series by depositing in escrow or trust with the Trustee
sufficient cash and/or Government Obligations and/or Eligible Obligations to pay
the principal of, premium, if any, and interest on the Indenture Securities of
that series to the stated maturity date or a redemption date for the Indenture
Securities of that series. If that happens, payment of the Indenture Securities
of such series may not be accelerated because of an event specified as a default
or Event of Default with respect to such Indenture Securities, and the holders
of the Indenture Securities of such series will not be entitled to the benefits
of the Indenture, except for registration of transfer and exchange of Indenture
Securities and replacement of lost, stolen or mutilated Indenture Securities.
The Indenture defines "Eligible Securities" 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 defeased
debt by one or more nationally recognized rating agencies.
Under Federal income tax law as of the date of this prospectus, a discharge
may be treated as an exchange of the related debt securities. Each holder might
be required to recognize gain or loss equal to the difference between the
holder's cost or other tax basis for the debt securities and the value of the
holder's interest in the trust. Holders might be required to include as income a
different amount than would be includable without the discharge. Prospective
investors are urged to consult their own advisors as to the tax consequences of
a discharge, including the applicability and effect of tax laws other than
Federal income tax law.
FORM, DENOMINATION AND REGISTRATION; BOOK ENTRY ONLY SYSTEM
Unless otherwise indicated in a prospectus supplement, the debt securities
will be issued only in fully registered form, without coupons, in denominations
of $1,000 or integral multiples thereof. (Section 302.) You will not have to pay
a service charge to transfer or exchange debt securities, but we may require you
to pay for taxes or other governmental charges due upon a transfer or exchange.
(Section 305.)
Unless otherwise indicated in a prospectus supplement, each series of
Indenture Securities will be deposited with, or on behalf of, The Depository
Trust Company ("DTC") or any successor depositary (the
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"Depositary") and will be represented by one or more Global Notes registered in
the name of Cede & Co., as nominee of DTC. The interests of beneficial owners in
the Global Notes will be represented through financial institutions acting on
their behalf as direct or indirect participants in DTC.
Ownership of beneficial interests in a Global Note will be limited to
persons who have accounts with DTC ("participants") or persons who hold
interests through participants. Ownership of beneficial interests in the Global
Notes will be shown on, and the transfer of these ownership interests will be
effected only through, records maintained by DTC or its nominee (with respect to
interests of participants) and the records of participants (with respect to
interests of persons other than participants).
So long as DTC, or its nominee, is the registered owner or holder of a
Global Note, DTC or such nominee, as the case may be, will be considered the
sole owner or holder of the Indenture Securities of that series represented by
such Global Note for all purposes of the Indenture, the Indenture Securities of
that series and applicable law. In addition, no beneficial owner of an interest
in a Global Note will be able to transfer that interest except in accordance
with DTC's applicable procedures (in addition to those under the Indenture).
Payments on Indenture Securities represented by Global Notes will be made
to DTC or its nominee, as the registered owner thereof. Neither we, the Trustee,
any underwriter nor any paying agent will have any responsibility or liability
for any aspect of the records relating to or payments made on account of
beneficial ownership interests in Global Notes, for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests or for any
action taken or omitted to be taken by the Depositary or any participant.
We expect that DTC or its nominee will credit participants' accounts on the
payable date with payments in respect of a Global Note in amounts proportionate
to their respective beneficial interest in the principal amount of such Global
Note as shown on the records of DTC or its nominee, unless DTC has reason to
believe that it will not receive payment on the payable date. We also expect
that payments by participants to owners of beneficial interests in such Global
Note held through such participants will be governed by standing instructions
and customary practices, as is now the case with securities held for the
accounts of customers registered in "street name." Such payments will be the
responsibility of such participants.
Transfers between participants in DTC will be effected in accordance with
DTC rules. The laws of some states require that certain persons take physical
delivery of securities in definitive form. Consequently, the ability to transfer
beneficial interests in a Global Note to such persons may be impaired. Because
DTC can only act on behalf of participants, who in turn act on behalf of others,
such as securities brokers and dealers, banks and trust companies ("indirect
participants"), the ability of a person having a beneficial interest in a Global
Note to pledge such interest to persons or entities that do not participate in
the DTC system, or otherwise take actions in respect of such interest, may be
impaired by the lack of a physical certificate of such interest.
We believe it is the policy of DTC to take any action permitted to be taken
by a holder of Indenture Securities of a series only at the direction of one or
more participants to whose account interests in Global Notes are credited and
only in respect of such portion of the aggregate principal amount of the
Indenture Securities of a series as to which such participant or participants
has or have given such direction.
If (1) the Depositary notifies us that it is unwilling or unable to
continue as Depositary or if the Depositary ceases to be eligible under the
Indenture and a successor depositary is not appointed by us within 90 days or
(2) an event of default with respect to a series of Indenture Securities shall
have occurred and be continuing, the respective Global Notes representing the
affected series of Indenture Securities will be exchanged for Indenture
Securities in definitive form of like tenor and of an equal aggregate principal
amount, in authorized denominations. Such definitive Indenture Securities shall
be registered in such name or names as the Depositary shall instruct the
Trustee. Such instructions will most likely be based upon directions received by
the Depositary from participants with respect to ownership of beneficial
interests in Global Notes.
DTC has advised us as follows: DTC is a limited-purpose trust company
organized under the New York Banking Law, a "banking organization" within the
meaning of the New York Banking Law, a member of the
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Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC holds securities that its
participants deposit with DTC and facilitates the settlement among participants
of securities transactions, such as transfers and pledges, in deposited
securities through electronic computerized book-entry changes in participants'
accounts, thereby eliminating the need for physical movement of securities
certificates. Direct participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other organizations. DTC is
owned by a number of its direct participants, including those who may act as
underwriters of our Indenture Securities, and by the New York Stock Exchange,
Inc., the American Stock Exchange, Inc. and the National Association of
Securities Dealers, Inc. Access to the DTC system is also available to others
such as indirect participants that clear through or maintain a custodial
relationship with a direct participant, either directly or indirectly. The rules
applicable to DTC and its participants are on file with the SEC.
DTC has further advised us that management of DTC is aware that some
computer applications, systems, and the like for processing data that are
dependent upon calendar dates, including dates before, on, and after January 1,
2000, may encounter "Year 2000 problems." DTC has informed its participants and
other members of the financial community that it has developed and is
implementing a program so that its systems, as the same relate to the timely
payment of distributions (including principal and interest payments) to security
holders, book-entry deliveries, and settlement of trades within DTC, continue to
function appropriately. This program includes a technical assessment and a
remediation plan, each of which DTC reports is complete. Additionally, DTC's
plan includes a testing phase, which DTC expects to be completed within
appropriate time frames.
However, DTC's ability to perform properly its services is also dependent
upon other parties, including but not limited to issuers and their agents, as
well as the DTC's direct and indirect participants and third party vendors from
whom DTC licenses software and hardware, and third party vendors on whom DTC
relies for information or the provision of services, including telecommunication
and electrical utility service providers, among others. DTC has informed the
industry that it is contacting (and will continue to contact) third party
vendors from whom DTC acquires services to: (1) impress upon them the importance
of such services being Year 2000 compliant; and (2) determine the extent of
their efforts for Year 2000 remediation (and, as appropriate, testing) of their
services. In addition, DTC is in the process of developing such contingency
plans as it deems appropriate.
According to DTC, the foregoing information with respect to DTC has been
provided to the industry for informational purposes only and is not intended to
serve as a representation, warranty, or contract modification of any kind.
Although DTC has agreed to the foregoing procedures in order to facilitate
transfers of interests in Global Notes among participants of DTC, it is under no
obligation to perform or continue to perform such procedures, and such
procedures may be discontinued at any time. Neither we, the Trustee, any
underwriter nor any paying agent will have any responsibility for the
performance by DTC or its participants or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
CONCERNING THE TRUSTEE
Harris Trust and Savings Bank is the Trustee under the Indenture. The bank
also may act as a depository of funds for, make loans to, and perform 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 holders of a majority in principal amount of the outstanding securities
issued under the Indenture will have the right to direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
Trustee, subject to certain exceptions. The Indenture provides that if an Event
of Default occurs (and it is not cured), the Trustee will be required, in the
exercise of its power, to use the degree of care of a prudent person in the
conduct of such person's own affairs. Subject to such provisions, the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indenture at the request of any
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holder of securities issued under the Indenture, unless such holder shall have
offered to the Trustee security and indemnity satisfactory to it against any
loss, liability or expense, and then only to the extent required by the terms of
the Indenture. 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.)
DESCRIPTION OF CAPITAL STOCK
AUTHORIZED AND OUTSTANDING CAPITAL STOCK
At January 31, 2000, the authorized capital stock of Enron was
1,216,500,000 shares, consisting of:
(a) 16,500,000 shares of preferred stock, no par value, of which:
- 1,288,922 shares of Cumulative Second Preferred Convertible Stock
were outstanding;
- 35.568509 shares of 9.142% Perpetual Second Preferred Stock were
issued and are held by an Enron subsidiary;
- 250,000 shares of Mandatorily Convertible Junior Preferred Stock,
Series B, were issued and outstanding;
- 204,800 shares of Mandatorily Convertible Single Reset Preferred
Stock, Series A, were issued and held by an Enron subsidiary;
- 83,000 shares of Mandatorily Convertible Single Reset Preferred
Stock, Series B, were issued and held by an Enron subsidiary;
(b) 1,200,000,000 shares of common stock, of which 721,189,559 shares
were outstanding.
COMMON STOCK
Enron is authorized to issue up to 1,200,000,000 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 our preferred stock.
If we offer preferred stock, the specific designations and rights will be
described in the prospectus supplement and a description will be filed with the
SEC.
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The 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 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"), an aggregate of 35.568509 shares of Enron preferred stock are
designated the 9.142% Perpetual Second Preferred Stock ("Enron 9.142% Preferred
Stock"), an aggregate of 250,000 shares of Enron preferred stock are designated
the Mandatory Convertible Junior Preferred Stock, Series B ("Enron Mandatorily
Convertible Junior Preferred Stock"), an aggregate of 204,800 shares of Enron
preferred stock are designated the Mandatorily Convertible Single Reset
Preferred Stock, Series A ("Enron Mandatorily Convertible Preferred Stock,
Series A"), and 83,000 shares of Enron preferred stock are designated the
Mandatorily Convertible Single Reset Preferred Stock, Series B ("Enron
Mandatorily Convertible Preferred Stock, Series B" and together with the Enron
Mandatorily Convertible Preferred Stock, Series A, the "Enron Mandatorily
Convertible Preferred Stock").
In addition to the Enron Convertible Preferred Stock, the Enron 9.142%
Preferred Stock, the Enron Mandatorily Convertible Junior Preferred Stock and
the Enron Mandatorily Convertible Preferred Stock, the Enron Board of Directors
has authority, without shareholder approval (except to the extent that holders
of 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
We have summarized the terms of the Enron Convertible Preferred Stock
below. The summary is not complete. The form of series designation for the Enron
Convertible Preferred Stock has been filed as an exhibit to this registration
statement, and you should read the form for any terms that may be important to
you.
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 is convertible (currently 27.304 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, the Enron Mandatorily Convertible
Junior Preferred Stock and the Enron Mandatorily Convertible Preferred 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, the Enron
Mandatorily Convertible Junior Preferred Stock and the Enron Mandatorily
Convertible Preferred 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 payment. Each share of Enron Convertible Preferred Stock is convertible into
27.304 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
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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:
- 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 that would
reduce the time for any notice to which the holders of the Enron
Convertible Preferred Stock may be entitled,
- 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,
- 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
- 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:
- 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 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
- 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 be able to elect two directors to
Enron's Board of Directors until such dividends have been paid or funds
sufficient therefor deposited in trust. If we fail to pay dividends when due on
this preferred stock, the terms of this preferred stock will prohibit us from
paying dividends on junior stock, including Enron common stock, and prohibit us
and our subsidiaries from acquiring junior stock, including Enron common stock,
subject to certain exceptions.
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9.142% PREFERRED STOCK
We have summarized the terms of the Enron 9.142% Preferred Stock below. The
summary is not complete. The form of series designation for the Enron 9.142%
Preferred Stock has been filed as an exhibit to this registration statement, and
you should read the form for any terms that may be important to you.
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, the Enron Mandatorily
Convertible Junior Preferred Stock and the Enron Mandatorily Convertible
Preferred 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 those
of the Enron common stock, the Enron Mandatorily Convertible Junior Preferred
Stock and the Enron Mandatorily Convertible Preferred 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:
- 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,
- 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,
- 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
- 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:
- 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 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
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- 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 be able to elect two directors to
Enron's Board of Directors until such dividends have been paid or funds
sufficient therefor deposited in trust. If we fail to pay dividends when due on
this preferred stock, the terms of this preferred stock will prohibit us from
paying dividends on junior stock, including Enron common stock, and prohibit us
and our subsidiaries from acquiring junior stock, including Enron common stock,
subject to certain exceptions.
ENRON MANDATORILY CONVERTIBLE JUNIOR PREFERRED STOCK
We have summarized the terms of the Enron Mandatorily Convertible Junior
Preferred Stock below. The summary is not complete. The form of the statement of
resolutions establishing the Enron Mandatorily Convertible Junior Preferred
Stock has been filed as an exhibit to this registration statement, and you
should read the form for any terms that may be important to you.
The annual rate of dividends payable on shares of the Enron Mandatorily
Convertible Junior Preferred Stock is 6.5%. The amount payable on shares of the
Enron Mandatorily Convertible Junior Preferred Stock in the event of any
liquidation, dissolution or winding up of the affairs of Enron is $4,000 per
share, together with accrued dividends. The dividend and liquidation rights of
the Enron Mandatorily Convertible Junior Preferred Stock are superior to the
dividend and liquidation rights of the Enron common stock, but rank junior to
the dividend and liquidation rights of all other outstanding series of Enron
preferred stock. The Enron Mandatorily Convertible Junior Preferred Stock is not
redeemable at the option of Enron. Each share of Enron Mandatorily Convertible
Junior Preferred Stock is convertible initially into 200 shares of Enron common
stock (which conversion rate is subject to certain adjustments).
The holders of Enron Mandatorily Convertible Junior Preferred Stock
generally have no voting rights but are entitled to certain class voting rights,
including the requirement for approval by the holders of at least a majority of
the Enron Mandatorily Convertible Junior Preferred Stock (voting together with
all other shares of parity stock similarly affected) to effect:
- an amendment to the Enron Charter that would adversely affect the voting
powers, rights or preferences of the holders of the Enron Mandatorily
Convertible Junior Preferred Stock,
- the sale, lease or conveyance by Enron of all or substantially all of its
assets,
- the authorization, creation, issuance or increase in the authorized
amount of securities ranking on a parity with the Enron Mandatorily
Convertible Junior Preferred Stock, or
- the merger or consolidation of Enron with or into any other corporation,
unless each holder of Enron Mandatorily Convertible Junior Preferred
Stock immediately preceding such merger or consolidation shall receive
the same number of shares, with substantially the same rights and
preferences, of the surviving corporation.
In addition, if full cumulative dividends are not paid for six consecutive
quarterly periods, the holders of the Enron Mandatorily Convertible Junior
Preferred Stock (together with the holders of any parity stock similarly
affected) will have the right to elect two directors to Enron's Board of
Directors until all dividends in arrears
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<PAGE> 19
have been paid or funds sufficient therefor deposited in trust. If we fail to
pay dividends when due on this preferred stock, the terms of this preferred
stock will prohibit us from paying dividends on junior stock, including Enron
common stock, and prohibit us and our subsidiaries from acquiring junior stock,
including Enron common stock, subject to certain exceptions.
ENRON MANDATORILY CONVERTIBLE PREFERRED STOCK
We have summarized the terms of the Enron Mandatorily Convertible Preferred
Stock, Series A and Series B, below. The summary is not complete. The terms of
the Series A and the Series B are generally the same except as discussed below.
The forms of the statement of resolutions establishing both series of the Enron
Mandatorily Convertible Preferred Stock have been filed as exhibits to this
registration statement, and you should read the forms for any terms that may be
important to you.
The shares of each of the two series of the Enron Mandatorily Convertible
Preferred Stock were deposited under deposit agreements, and the related
depositary shares were then deposited into trusts of which we are the beneficial
owner. The depositary shares are to be sold by the trusts only if a default
occurs under certain of our debt obligations or under certain debt obligations
that were incurred in connection with our investment in Wessex Water Plc and
Elektro-Eletricidade e Servicos S.A. (the "Obligations") or our credit ratings
fall below investment grade and, in the case of Series A, our common stock price
falls below $18.92, subject to certain adjustments. The date that the depositary
shares are sold by the trust, or under certain circumstances the date the
depositary shares were to have been sold but were unable to be sold, is the Rate
Reset Date, and the market price of Enron common stock on the day such sale is
priced is the Reset Price, subject to certain adjustments. If the Obligations,
which generally mature on or before December 2001, are timely repaid in full, we
expect the Enron Mandatorily Convertible Preferred Stock will be retired and
canceled.
No dividends are payable on the Enron Mandatorily Convertible Preferred
Stock prior to the applicable Rate Reset Date. After a Rate Reset Date, the
annual rate of dividends payable is $350 per share plus an amount which is
intended to approximate the dividend yield on the Enron common stock as of the
Rate Reset Date. Such dividends are payable quarterly and are cumulative. The
amount payable on shares of Enron Mandatorily Convertible Preferred Stock in the
event of any liquidation, dissolution or winding up of the affairs of Enron is
$5,000 per share, together with accrued dividends to the date of payment. These
dividend and liquidation rights are superior to the dividend and liquidation
rights of the Enron common stock and the Enron Mandatorily Convertible Junior
Preferred Stock, but rank junior to the dividend and liquidation rights of the
Enron Convertible Preferred Stock and Enron 9.142% Preferred Stock.
The Enron Mandatorily Convertible Preferred Stock is not redeemable after
the Rate Reset Date. The Enron Mandatorily Convertible Preferred Stock will be
converted into Enron common stock on the third anniversary of the Rate Reset
Date. The number of shares issuable per share of Enron Mandatorily Convertible
Preferred Stock on conversion will equal the liquidation preference ($5,000)
divided by the conversion price. The conversion price will be between 100% to
110% of the applicable Reset Price (subject to certain adjustments) depending on
the market price of Enron common stock at the time of conversion. After the Rate
Reset Date and prior to the third anniversary of the Rate Reset Date, the
holders of the Enron Mandatorily Convertible Preferred Stock will be entitled to
convert such shares into Enron common stock based on a conversion price of 110%
of the Reset Price (subject to certain adjustments).
The holders of each series of Enron Mandatorily Convertible Preferred Stock
generally have no voting rights, but are entitled to certain class voting
rights, including the requirement for approval by the holders of at least a
majority of each series to effect:
- an amendment to the Enron Charter that would adversely affect the powers,
rights or preferences of the holders of such series of Enron Mandatorily
Convertible Preferred Stock,
- the authorization or issuance of capital stock ranking senior to the
Enron Mandatorily Convertible Preferred Stock, or
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<PAGE> 20
- the merger or statutory exchange in which holders of the Enron
Mandatorily Convertible Preferred Stock do not receive a similar
preferred stock in the surviving entity, subject to certain exceptions.
If the Obligations are not paid when due, the holders of each series of
Enron Mandatorily Convertible Preferred Stock will have the right to elect two
directors to Enron's Board of Directors until such debt is paid or certain other
events occur. In addition, if full cumulative dividends are not paid for six
consecutive quarterly periods, the holders of the Enron Mandatorily Convertible
Preferred Stock (together with the holders of any parity stock similarly
affected) will have the right to elect two directors to Enron's Board of
Directors until all dividends in arrears have been paid. If we fail to pay
dividends when due on Enron Mandatorily Convertible Preferred Stock, the terms
of the Enron Mandatorily Convertible Preferred Stock will prohibit us from
paying dividends on junior stock, including Enron common stock, and prohibit us
and our subsidiaries from acquiring junior stock, including Enron common stock,
subject to certain exceptions.
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.
"Business Transaction" means (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" means 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 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
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<PAGE> 21
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. 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, 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 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.
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<PAGE> 22
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
We may choose to offer fractional interests in the preferred stock. If so,
we will offer depositary shares, each of which will represent a fraction (to be
set forth in the prospectus supplement relating to a particular series of
preferred stock) of a share of a particular series of preferred stock as
described below.
The preferred stock of any series represented by depositary shares will be
deposited under a 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 preferred stock represented
by such depositary share, to all the rights and preferences of the preferred
stock represented thereby (including dividend, voting, redemption and
liquidation rights).
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
those persons purchasing the fractional interests in preferred stock in
accordance with the terms of the offering set forth in the applicable prospectus
supplement.
We have summarized the terms of the depositary shares below. The summary is
not complete. 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 you should
read the exhibit for any terms that may be important to you.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all dividends or other cash distributions
received in respect of the preferred stock to the record holders of depositary
shares relating to such 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 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.
WITHDRAWAL OF THE PREFERRED STOCK
Upon surrender of the depositary receipts at the corporate trust office of
the Depositary (unless the related 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 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 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 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 preferred stock represented by depositary shares, the
Depositary will redeem as of the same redemption date the number of depositary
shares representing preferred stock so redeemed, provided Enron shall have paid
in full to the Depositary the redemption price of the preferred stock to be
redeemed (which redemption price shall include an amount equal to any accrued
and unpaid dividends thereon to the
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<PAGE> 23
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 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 PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the 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 preferred stock) will be entitled to
instruct the Depositary as to the exercise of the voting rights pertaining to
the amount of preferred stock represented by such holder's depositary shares.
The Depositary will endeavor, insofar as practicable, to vote the number of
shares of 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 preferred stock (but, at its
discretion, not from appearing at any meeting with respect to such preferred
stock) to the extent it does not receive specific instructions from the holders
of depositary shares representing 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 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 distribution in respect of the
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 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 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.
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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.
PLAN OF DISTRIBUTION
We may sell the offered securities (a) through agents; (b) through
underwriters or dealers; (c) directly to one or more purchasers; or (d) pursuant
to delayed delivery contracts or forward contracts.
BY AGENTS
Offered securities may be sold through agents designated by us. The agents
agree to use their reasonable best efforts to solicit purchases for the period
of their appointment.
BY UNDERWRITERS
If underwriters are used in the sale, the offered securities will be
acquired by the underwriters for their own account. The underwriters may resell
the securities in one or more transactions, including negotiated transactions,
at a fixed public offering price or at varying prices determined at the time of
sale. The obligations of the underwriters to purchase the securities will be
subject to certain conditions. The underwriters will be obligated to purchase
all the securities of the series offered if any of the securities are purchased.
Any initial public offering price and any discounts or concessions allowed or
re-allowed or paid to dealers may be changed from time to time.
DIRECT SALES
Offered securities may also be sold directly by us. In this case, no
underwriters or agents would be involved. We may use electronic media, including
the Internet, to sell offered securities directly.
DELAYED DELIVERY CONTRACTS OR FORWARD CONTRACTS
If indicated in the prospectus supplement, we will authorize agents,
underwriters or dealers to solicit offers to purchase offered securities from us
at the public offering price set forth in the prospectus supplement pursuant to
delayed delivery contracts or forward contracts providing for payment or
delivery on a specified date in the future at prices determined as described in
the prospectus supplement. 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.
GENERAL INFORMATION
The offered securities (other than common stock, which is traded on the New
York Stock Exchange under the symbol "ENE"), 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.
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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.
Underwriters, dealers and agents that participate in the distribution of
the offered securities may be underwriters as defined in the Securities Act of
1933, and any discounts or commissions received by them from us and any profit
on the resale of the offered securities by them may be treated as underwriting
discounts and commissions under the Act. Any underwriters or agents will be
identified and their compensation described in a prospectus supplement.
We may have agreements with the underwriters, dealers and agents to
indemnify them against certain civil liabilities, including liabilities under
the Securities Act of 1933, or to contribute with respect to payments which the
underwriters, dealers or agents may be required to make.
Underwriters, dealers and agents or their affiliates may engage in
transactions with, or perform services for, us or our subsidiaries in the
ordinary course of their businesses.
VALIDITY OF SECURITIES
The validity of the offered securities will be passed upon for Enron by
James V. Derrick, Jr., Esq., Executive 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 18, 1999 and consolidated financial statements and schedule
included in Enron's Annual Report on Form 10-K for the year ended December 31,
1998, 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, 1998, 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.
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[ENRON LOGO]
<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......... $524,969*
Accounting Fees and Expenses................................ 50,000
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............................................... 15,031
--------
Total............................................. $850,000
========
</TABLE>
- ---------------
* Previously paid
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>
<C> <S>
*1.01 -- Form of Underwriting Agreement -- Debt Securities
(Exhibit 1.01 to Enron Registration Statement on Form
S-3 -- File No. 333-35549)
*1.02 -- Form of Underwriting Agreement -- Equity Securities
(Exhibit 1.02 to Enron Registration Statement on Form
S-3 -- File No. 333-35549)
*1.03 -- Enron Corp. Underwriting Agreement Standard Provisions,
dated as of September 15, 1997 (Exhibit 1.03 to Enron
Registration Statement on Form S-3 -- File No. 333-35549)
</TABLE>
II-1
<PAGE> 28
<TABLE>
<C> <S>
*3.01 -- Amended and Restated Articles of Incorporation of Enron
Oregon Corp. (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 -- Articles of Amendment of Enron: 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 -- Articles of Amendment of Enron: 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).
*3.07 -- Articles of Amendment of Enron: Form of Series
Designation for the Enron Series A Junior Voting
Convertible Preferred Stock (Exhibit 3.07 to Enron's
Registration Statement on Form S-3 -- File No.
333-44133).
*3.08 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Single Reset Preferred
Stock, Series A (Exhibit 4.01 to Enron's Form 8-K filed
on January 26, 1999).
*3.09 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Single Reset Preferred
Stock, Series B (Exhibit 4.02 to Enron's Form 8-K filed
on January 26, 1999).
3.10 -- Articles of Amendment of Enron amending Article IV of the
Articles of Incorporation.
3.11 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Junior Preferred Stock,
Series B.
*4.01 -- Indenture dated as of November 1, 1985, between 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
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).
</TABLE>
II-2
<PAGE> 29
<TABLE>
<C> <S>
*4.03 -- Third Supplemental Indenture, dated as of September 1,
1997, between Enron Corp. and Harris Trust and Savings
Bank, as Trustee. (Exhibit 4.03 to Enron Registration
Statement on Form S-3 -- File No. 333-35549).
*4.04 -- Fourth Supplemental Indenture, dated as of August 17,
1999, between Enron Corp. and Harris Trust and Savings
Bank, as Trustee (Exhibit 4.05 to Enron Registration
Statement on Form S-3 -- File No. 333-83549).
*4.05 -- Form of Deposit Agreement between Enron and the
Depositary (Exhibit 4(b) to Enron Registration Statement
No. 33-50641, filed October 15, 1993).
5 -- Opinion of James V. Derrick, Jr., Esq., Executive Vice
President and General Counsel of Enron, as to validity of
debt securities, preferred stock, depositary shares and
common stock.
12 -- Computation of Enron's Ratio of Earnings to Combined
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.
** Previously filed.
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;
(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
II-3
<PAGE> 30
(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 1st day of March,
2000.
ENRON CORP.
(Registrant)
By: /s/ RICHARD A. CAUSEY
----------------------------------
Richard A. Causey
Executive Vice President and
Chief Accounting 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 1st day of March, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S> <C>
/s/ KENNETH L. LAY Chairman of the Board, Chief Executive
------------------------------------------------------ Officer and Director (Principal
(Kenneth L. Lay) Executive Officer)
/s/ RICHARD A. CAUSEY Executive Vice President and Chief
------------------------------------------------------ Accounting Officer (Principal Accounting
(Richard A. Causey) Officer)
/s/ ANDREW S. FASTOW Executive Vice President and Chief
------------------------------------------------------ Financial Officer (Principal Financial
(Andrew S. Fastow) Officer)
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)
KEN L. HARRISON* Director
------------------------------------------------------
(Ken L. Harrison)
</TABLE>
II-5
<PAGE> 32
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S> <C>
ROBERT K. JAEDICKE* Director
------------------------------------------------------
(Robert K. Jaedicke)
CHARLES A. LEMAISTRE* Director
------------------------------------------------------
(Charles A. LeMaistre)
REBECCA MARK-JUSBASCHE* Director
------------------------------------------------------
(Rebecca Mark-Jusbasche)
JOHN MENDELSOHN* Director
------------------------------------------------------
(John Mendelsohn)
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)
HERBERT S. WINOKUR, JR.* Director
------------------------------------------------------
(Herbert S. Winokur, Jr.)
Constituting a Majority of the Board of Directors
*By: /s/ REBECCA C. CARTER
-------------------------------------------------
Rebecca C. Carter
(Attorney-in-fact for persons indicated)
</TABLE>
II-6
<PAGE> 33
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
*1.01 -- Form of Underwriting Agreement -- Debt Securities
(Exhibit 1.01 to Enron Registration Statement on Form
S-3 -- File No. 333-35549).
*1.02 -- Form of Underwriting Agreement -- Equity Securities
(Exhibit 1.02 to Enron Registration Statement on Form
S-3 -- File No. 333-35549).
*1.03 -- Enron Corp. Underwriting Agreement Standard Provisions,
dated as of September 15, 1997 (Exhibit 1.03 to Enron
Registration Statement on Form S-3 -- File No.
333-35549).
*3.01 -- Amended and Restated Articles of Incorporation of Enron
Oregon Corp. (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 -- Articles of Amendment of Enron: 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 -- Articles of Amendment of Enron: 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).
*3.07 -- Articles of Amendment of Enron: Form of Series
Designation for the Enron Series A Junior Voting
Convertible Preferred Stock (Exhibit 3.07 to Enron's
Registration Statement on Form S-3 -- File No.
333-44133).
*3.08 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Single Reset Preferred
Stock, Series A (Exhibit 4.01 to Enron's Form 8-K filed
on January 26, 1999).
*3.09 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Single Reset Preferred
Stock, Series B (Exhibit 4.02 to Enron's Form 8-K filed
on January 26, 1999).
3.10 -- Articles of Amendment of Enron amending Article IV of the
Articles of Incorporation.
3.11 -- Articles of Amendment of Enron: Statement of Resolutions
Establishing A Series of Preferred Stock of Enron
Corp. -- Mandatorily Convertible Junior Preferred Stock,
Series B.
</TABLE>
<PAGE> 34
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
*4.01 -- Indenture dated as of November 1, 1985, between 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
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 -- Third Supplemental Indenture, dated as of September 1,
1997, between Enron Corp. and Harris Trust and Savings
Bank, as Trustee. (Exhibit 4.03 to Enron Registration
Statement on Form S-3 -- File No. 333-35549).
*4.04 -- Fourth Supplemental Indenture, dated as of August 17,
1999, between Enron Corp. and Harris Trust and Savings
Bank, as Trustee (Exhibit 4.05 to Enron Registration
Statement on Form S-3 -- File No. 333-83549).
*4.05 -- Form of Deposit Agreement between Enron and the
Depositary (Exhibit 4(b) to Enron Registration Statement
No. 33-50641, filed October 15, 1993).
5 -- Opinion of James V. Derrick, Jr., Esq., Executive Vice
President and General Counsel of Enron, as to validity of
debt securities, preferred stock, depositary shares and
common stock.
12 -- Computation of Enron's Ratio of Earnings to Combined
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.
** Previously filed.
<PAGE> 1
Exhibit 3.10
<TABLE>
<S> <C>
[STATE OF OREGON SEAL] PHONE: (509) 988-2200
FAX: (503) 378-4381 ARTICLES OF AMENDMENT-BUSINESS/PROFESSIONAL/NONPROFIT
-------------------------------------------------------------------------------------------------------------
Secretary of State Check the appropriate box below; For office use only
Corporation Division [X] BUSINESS/PROFESSIONAL/ CORPORATION
255 Capitol St. NE, Suite 151 (Complete only 1, 2, 3, 4, 6, 7)
Salem, OR 97310-1327 [STAMP]
[ ] NONPROFIT CORPORATION
(Complete only 1, 2, 3, 5, 6, 7)
REGISTRY NUMBER: 527549-84
--------------------------
Attach Additional Sheet If Necessary
Please Type or Print Legibly in Black Ink
- ------------------------------------------------------------------------------------------------------------------------------------
1) NAME OF CORPORATION PRIOR TO AMENDMENT Enron Corp.
------------------------------------------------------------------------------------------
2) STATE THE ARTICLE NUMBER(S) AND SET FORTH THE ARTICLE(S) AS IT IS AMENDED TO READ. (ATTACH A SEPARATE SHEET IF NECESSARY.)
Article IV of the Articles of Incorporation is hereby amended by amending the first paragraph in its entirety, as set forth on
---------------------------------------------------------------------------------------------------------------------------------
Exhibit A hereto.
---------------------------------------------------------------------------------------------------------------------------------
3) THE AMENDMENT WAS ADOPTED ON: June 28, 1999
------------------------------------------------------------
(If more than one amendment was adopted, identify the date of adoption of each amendment.)
- ------------------------------------------------------------------------------------------------------------------------------------
BUSINESS/PROFESSIONAL CORPORATION ONLY
4) CHECK THE APPROPRIATE STATEMENT
[X] Shareholder action was required to adopt the amendment(s).
The vote was as follows:
- ---------------------------------------------------------------------------------
Class or Number of Number of Number of Number of
series of shares votes entitled to votes cast votes cast
shares outstanding be cast FOR AGAINST
- ---------------------------------------------------------------------------------
Common
& Pref. 369,169,509 369,169,509 309,750,986 4,738,094
- ---------------------------------------------------------------------------------
[ ] Shareholder actions was not required to adopt the amendment(s). The
amendment(s) was adopted by the board of directors without shareholder action.
[ ] The corporation has not issued any shares of stock. Shareholder
action was not required to adopt the amendment(s). The
amendment(s) was adopted by the incorporators or by the board of
directors.
NONPROFIT CORPORATION ONLY
5) CHECK THE APPROPRIATE STATEMENT
[ ] Membership approval was not required. The amendment(s) was
approved by a sufficient vote of the board of directors or
incorporators.
[ ] Membership approval was required. The membership vote was
as follows:
- ---------------------------------------------------------------------------------
Class(es) Number of Number of Number of Number of
entitled members entitled votes entitled to votes cast votes cast
to vote to vote be cast FOR AGAINST
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
6) EXECUTION
PRINTED NAME SIGNATURE TITLE
Rebecca C. Carter /s/ REBECCA C. CARTER Senior Vice President & Secretary
------------------------ ----------------------------- ------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
7) CONTACT NAME DAYTIME PHONE NUMBER
Kate B. Cole (713) 853-1624
---------------------------------------- ---------------------------------------------------------------------------------------
------------------------------
FEES
----------------------------
MAKE CHECK FOR $10 PAYABLE TO
"CORPORATION DIVISION."
NOTE: FILING FEES MAY BE PAID
WITH VISA OR MASTERCARD. THE
CARD NUMBER AND EXPIRATION DATE
SHOULD BE WRITTEN ON A
SEPARATE SHEET FOR YOUR
PROTECTION.
------------------------------
</TABLE>
<PAGE> 2
EXHIBIT A
RESOLVED, that the Amended and Restated Articles of Incorporation of Enron
Corp. are hereby amended by amending the first paragraph of Article IV thereof
to read in its entirety as follows:
"The total number of shares of all classes of stock
which this Corporation shall have authority to issue is
1,216,500,000 shares of capital stock, of which
16,500,000 shares are Preferred Stock (the "Preferred
Stock"), and 1,200,000,000 shares are Common Stock (the
"Common Stock")."
<PAGE> 1
EXHIBIT 3.11
STATEMENT OF RESOLUTIONS ESTABLISHING
A SERIES OF PREFERRED STOCK OF
ENRON CORP.
MANDATORILY CONVERTIBLE JUNIOR PREFERRED STOCK, SERIES B
Pursuant to Oregon Revised Statutes Section 60.134 and Article IV of
the Articles of Incorporation, as amended, of Enron Corp. (the "Corporation"),
the Board of Directors of the Corporation has duly adopted the following
resolutions on September 17, 1999, establishing a series of Preferred Stock of
the Corporation:
RESOLVED, that there is hereby established a series of Preferred
Stock of the Corporation designated the Mandatorily Convertible Junior
Preferred Stock, Series B (herein referred to as the "Mandatorily Convertible
Junior Preferred Stock, Series B"). The designation and number of shares of
such series and the powers, preferences and relative, participating, optional
or other special rights, and the qualifications, limitations and restrictions
thereof (in addition to those set forth in the Articles of Incorporation, as
amended, that may be applicable to such series) are as follows:
A. Definitions. Capitalized terms used but not defined herein
shall have the meaning ascribed thereto in the Corporation's Articles of
Incorporation, as amended. In addition, the following terms shall have the
following meanings when used herein:
(1) The term "accrued dividends" for a share shall mean an
amount computed at the quarterly dividend rate on such share from
the date on which dividends on such share become cumulative to and
including the date to which such dividends are to be accrued, less
the aggregate amount of all dividends theretofore paid thereon.
(2) The term "Business Day" shall mean any day of the year
except Saturday or Sunday that is a day on which banks are not
required or authorized by law to close in New York City, New York,
Houston, Texas, or Wilmington, Delaware.
(3) The term "Closing Date" shall mean the date on which
the offering and sale of (i) the Notes of the Trust and Osprey I,
Inc., a Delaware corporation, and (ii) $100,000,000 of Certificates
of the Trust are consummated.
<PAGE> 2
(4) The term "junior stock" shall mean (and references to
shares ranking "junior to" the Mandatorily Convertible Junior
Preferred Stock, Series B) shall refer to, with respect to
paragraphs C and G, the Common Stock of the Corporation and any
other class or series of stock of the Corporation not entitled to
receive any dividends unless all dividends required to have been
paid or declared and set apart for payment on the Mandatorily
Convertible Junior Preferred Stock, Series B shall have been so paid
or declared and, with respect to paragraphs D and G, any class or
series of stock of the Corporation not entitled to receive any
assets upon the liquidation, dissolution or winding up of the
affairs of the Corporation until the Mandatorily Convertible Junior
Preferred Stock, Series B shall have received the entire amount to
which such stock is entitled upon liquidation, dissolution or
winding up.
(5) The term "Initial Dividend Period" shall mean the
period commencing on the date of the first issuance of shares of
Mandatorily Convertible Junior Preferred Stock, Series B and ending
on the last day of December, 1999, and thereafter until the
Remarketing Date, each subsequent six-month period commencing on the
first day of each January and July and ending on the last day of
each June and December or, with respect to the final such period
ending on the day prior to the Remarketing Date.
(6) The term "Dividend Period" shall mean the period
commencing on the Remarketing Date and ending on the last day of the
next occurring March, June, September or December, and, thereafter,
each subsequent period commencing on the first day of each calendar
quarter and ending on the last day of each calendar quarter.
(7) The term "Indenture" shall mean the Indenture dated
as of the Closing Date among the Trust, Osprey I, Inc. and the
indenture trustee thereunder providing for the issuance of the Notes.
(8) The Term "Notes" shall mean $1,400,000,000 of 8.31%
Senior Secured Notes due 2003 of the Trust.
(9) The term "parity stock" (and references to shares
ranking "on a parity with" the Mandatorily Convertible Junior
Preferred Stock, Series B) shall refer to, with respect to
paragraphs C and G, any class or series of stock of the Corporation
entitled to receive payment of dividends on a parity with the
Mandatorily Convertible Junior Preferred Stock, Series B and, with
respect to paragraphs D and G, any class or series of stock of the
Corporation entitled to receive assets upon the liquidation,
dissolution or winding up of the affairs of the Corporation on a
parity with the Mandatorily Convertible Junior Preferred Stock,
Series B. The Corporation's Mandatorily Convertible Single Reset
Preferred Stock, Series A shall be parity stock with respect to the
Mandatorily Convertible Junior Preferred Stock, Series B.
(10) The term "Remarketing Agreement" shall mean the
Remarketing and Registration Rights Agreement dated as of the
Closing Date among the Corporation, Condor Share Trust, the Trust,
Whitewing Associates L.P., Whitewing Management, LLC,
United States Trust Company of New York, as Indenture Trustee, and
Deutsche Banc Securities Inc., Donaldson, Lufkin & Jenrette
Securities Corporation, Bear, Stearns & Co. Inc. and Salomon Smith
Barney Inc., as Initial Remarketing Agents. The Corporation will
furnish any shareholder of the Corporation with a copy of the
Remarketing Agreement without charge upon request in writing to the
Secretary of the Corporation.
2
<PAGE> 3
(11) The term "Remarketing Date" shall mean the date that
the shares of Mandatorily Convertible Junior Preferred Stock, Series
B are transferred pursuant to the Remarketing Agreement.
(12) The term "Share Settlement Agreement" means the share
settlement agreement dated as of the Closing Date between Enron and
Condor Share Trust. The Corporation will furnish any shareholder of
the Corporation with a copy of the Remarketing Agreement without
charge upon request in writing to the Secretary of the Corporation.
(13) The term "senior stock" (and references to shares
ranking "senior to" or "prior to" the Mandatorily Convertible Junior
Preferred Stock, Series B) shall refer to, with respect to
paragraphs C and G, any class or series of stock of the Corporation
ranking senior to the Mandatorily Convertible Junior Preferred
Stock, Series B in respect of the right to receive dividends and,
with respect to paragraphs D and G, any class or series of stock of
the Corporation ranking senior to the Mandatorily Convertible Junior
Preferred Stock, Series B with respect to the right to receive
assets upon the liquidation, dissolution or winding up of the
affairs of the Corporation. All classes or series of stock of the
Corporation other than junior stock or parity stock shall be senior
stock with respect to the Mandatorily Convertible Junior Preferred
Stock, Series B, except to the extent expressly provided otherwise
in the Corporation's Articles of Incorporation, as amended,
including any Statement of Resolutions Establishing a Series of
Preferred Stock. The Corporation's 9.142% Perpetual Second Preferred
Stock and Cumulative Second Preferred Convertible Stock shall be
senior stock with respect to the Mandatorily Convertible Junior
Preferred Stock, Series B.
(14) The term "Settlement Date" shall have the meaning
ascribed to such term in the Remarketing Agreement.
(15) The term "Trust" shall mean Osprey Trust, a Delaware
business trust.
B. Designation. The distinctive designation of the series shall be
the "Mandatorily Convertible Junior Preferred Stock, Series B." The number of
shares that shall constitute such series shall be an indefinite number of
shares up to the number of shares necessary to fulfill the Corporation's
obligations pursuant to the Share Settlement Agreement, but in no event more
than the number of authorized but unissued shares of Preferred Stock, with
250,000 shares initially issued.
3
<PAGE> 4
C. Dividends.
(1) The holders of the Mandatorily Convertible Junior
Preferred Stock, Series B, in preference to the rights of holders of
any junior stock but subject to the rights of any senior stock,
shall be entitled to receive, as and when declared by the Board of
Directors out of any funds legally available therefor, cash
dividends, at a rate, at all times during each Limited Dividend
Period and Dividend Period, equal to 6.5%, calculated on the amount
of the liquidation value of $4,000 per share, and no more provided,
however, that at any time from and after the occurrence of an Event
of Default under Sections 9.01(a) or (b) of the Indenture, the
dividends on the Mandatorily Convertible Junior Preferred Stock,
Series B shall accumulate at a rate, at all times during the
continuance of any such Event of Default and for each Limited
Dividend Period and Dividend Period occurring therein, equal to
8.3%, calculated on the amount of the liquidation value of $4,000
per share, and no more (as in effect from time to time, the
"Dividend Rate"), payable semi-annually on each January 9 and July
9 following the end of each Initial Dividend Period (each such date
being hereinafter referred to as an "Initial Dividend Payment
Date"), or if an Initial Dividend Payment Date is not a Business
Day, then the Initial Dividend Payment Date shall be the next
succeeding Business Day. After the Remarketing Date, such dividends
shall be payable quarterly on each January 9, April 9, July 9 and
October 9 following the end of each Dividend Period. Such dividends
shall be cumulative from and shall accrue on all shares of the
Mandatorily Convertible Junior Preferred Stock, Series B from the
beginning of the first Initial Dividend Period. All computations of
the Dividend Rate shall be made on the basis of a year of 360 days
for the actual number of days included in the Initial Dividend
Period or Dividend Period.
(2) No dividend shall be paid upon, or declared or set
apart for, any share of Mandatorily Convertible Junior Preferred
Stock, Series B or shares ranking on parity with the Mandatorily
Convertible Junior Preferred Stock, Series B for any dividend period
unless at the same time a like proportionate dividend for the same
dividend period, ratable in proportion to the respective annual
dividend rates fixed therefor, shall be paid upon, or declared and
set apart for, all shares of Mandatorily Convertible Junior
Preferred Stock, Series B and any Preferred Stock ranking on parity
with the Mandatorily Convertible Junior Preferred Stock, Series B
that are entitled to such dividends.
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(3) Until such time as all shares of Mandatorily
Convertible Junior Preferred Stock, Series B shall have been
canceled pursuant to subparagraph F(12) below, in no event at any
time shall any dividend, whether in cash or property, be paid or
declared, nor shall any distribution be made, on any junior stock,
nor shall any shares of any junior stock be purchased, redeemed or
otherwise acquired for value by the Corporation, nor shall the
Corporation permit any shares of any junior stock to be purchased,
redeemed or otherwise acquired by any subsidiary of the Corporation,
unless full cumulative dividends on the Mandatorily Convertible
Junior Preferred Stock, Series B scheduled to be paid at or prior to
such time pursuant to paragraph C(1) have been declared and paid.
The foregoing provisions of this subparagraph (3) shall not,
however, apply to (i) a dividend payable solely in any junior stock,
(ii) the acquisitions of shares of any junior stock in exchange for,
or through application of the proceeds of the sale of, shares of any
other junior stock, (iii) the acquisitions of shares of any junior
stock pursuant to contractual obligations binding against the
Corporation or any of its subsidiaries that were entered into prior
to the date of the first issuance of shares of Mandatorily
Convertible Junior Preferred Stock, Series B or that are entered
into at a time when such acquisitions of shares could be made
pursuant to this subparagraph (3) or (iv) the dividend, distribution
or issuance of Rights. "Rights" means rights or warrants distributed
by the Corporation under a shareholder rights plan or agreement to
all holders of Common Stock entitling the holders thereof to
subscribe for or purchase shares of the Corporation's capital stock
(either initially or under certain circumstances), which rights or
warrants, until the occurrence of a specified event or events
("Trigger Events"):
(a) are deemed to be transferred with such
shares of Common Stock,
(b) are not exercisable, and
(c) are also issued in respect of future
issuances of Common Stock.
(4) In no event will any dividend or distribution be made
on or in respect of Mandatorily Convertible Junior Preferred Stock,
Series B other than in cash without the consent of all the holders
of the Mandatorily Convertible Junior Preferred Stock, Series B.
D. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Corporation, then, before any distribution or payments shall be made to the
holders of any junior stock, but subject to the rights of any senior stock or
parity stock, the holders of the Mandatorily Convertible Junior Preferred
Stock, Series B shall be entitled to be paid in full in cash the amount of
$4,000 per share, together with accrued dividends to the date of such
distribution or payment, whether or not earned or declared. If such payment
shall have been made in full to the holders of the Mandatorily Convertible
Junior Preferred Stock, Series B and all preferential payments or distributions
to be made with respect to senior stock and parity stock have been made in
full, the remaining assets and funds of the Corporation shall be distributed
among the holders of the junior stock, according to their respective rights and
preferences and in each case according to their respective shares. If, upon any
liquidation, dissolution or winding up of the affairs of the Corporation, the
amounts so payable are not paid in full to the holders of all shares of the
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Mandatorily Convertible Junior Preferred Stock, Series B and parity stock, the
holders of the Mandatorily Convertible Junior Preferred Stock, Series B,
together with holders of parity stock, shall share ratably in any distribution
of assets in proportion to the full amounts to which they would otherwise be
respectively entitled. Neither the consolidation or merger of the Corporation,
nor the sale, lease or conveyance of all or a part of its assets, shall be
deemed a liquidation, dissolution or winding up of the affairs of the
Corporation within the meaning of the foregoing provisions of this paragraph D
or paragraph G hereof.
E. Redemption. The Corporation shall not have the right to redeem
any or all of the Mandatorily Convertible Junior Preferred Stock, Series B at
any time.
F. Conversion Rights.
(1) Unless previously converted at the option of the
holder in accordance with the provisions hereof, on the third
anniversary of the Settlement Date (other than a Settlement Date
occurring by reason of the occurrence of a Failed Remarketing), or
if such date is not a Business Day, the next succeeding day that is
a Business Day ( the "Mandatory Conversion Date"), each outstanding
share of Mandatorily Convertible Junior Preferred Stock, Series B
shall, without additional notice to holders thereof, convert
automatically (the "Mandatory Conversion") into (i) a number of
fully paid and non-assessable shares of Common Stock at the
Conversion Rate (as defined herein) in effect on the Mandatory
Conversion Date; and (ii) the right to receive an amount in cash
equal to all accrued and unpaid dividends on such share of
Mandatorily Convertible Junior Preferred Stock, Series B (other than
previously declared dividends payable to a holder of record as of a
prior date) to and including the day immediately prior to the
Mandatory Conversion Date, whether or not earned or declared, out of
funds legally available therefor (and if sufficient funds are not
then legally available therefor, the Corporation shall pay such
amount, if any, pro rata (based on the amounts so owing) to the
holders of the Mandatorily Convertible Junior Preferred Stock,
Series B and any parity stock then entitled to similar payment as is
then legally available therefor and shall pay any deficiency
thereafter as soon as funds are legally available therefor).
Dividends on the Mandatorily Convertible Junior Preferred Stock,
Series B shall cease to accrue, and Mandatorily Convertible Junior
Preferred Stock, Series B shall cease to be outstanding, on the
Mandatory Conversion Date. The Corporation shall make such
arrangements as it deems appropriate for the issuance of
certificates representing Common Stock and for the payment of cash
in respect of such accrued and unpaid dividends, if any, or cash in
lieu of fractional shares, if any, in exchange for and contingent
upon surrender of certificates representing the Mandatorily
Convertible Junior Preferred Stock, Series B, and the Corporation
may defer the payment of dividends on such Common Stock and the
voting thereof until, and make such payment and voting contingent
upon, the surrender of such certificates representing the
Mandatorily Convertible Junior Preferred Stock, Series B, provided
that the Corporation shall give the holders of the Mandatorily
Convertible Junior Preferred Stock, Series B such notice of any such
actions as the Corporation deems appropriate and upon such surrender
such holders shall be entitled to receive such dividends declared
and paid on such Common Stock subsequent to the Mandatory Conversion
Date. Amounts payable in cash in respect of the Mandatorily
Convertible Junior Preferred Stock, Series B or in respect of such
Common Stock shall not bear interest.
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(2) Each share of the Mandatorily Convertible Junior
Preferred Stock, Series B shall be convertible at any time prior to
the Mandatory Conversion Date at the option of the holder thereof
into fully paid and non-assessable shares of Common Stock (the
"Common Shares," subject to subparagraph (10)) of the Corporation at
the conversion rate, determined as hereinafter provided, in effect
at the time of conversion. The rate at which Common Shares shall be
delivered upon conversion of shares of the Mandatorily Convertible
Junior Preferred Stock, Series B (herein called the "Conversion
Rate") shall be initially 200 Common Shares for each share of
Mandatorily Convertible Junior Preferred Stock, Series B. The
Conversion Rate shall be subject to adjustment as provided for
below. Upon conversion, no payment, allowance or adjustment shall be
made for accumulated and unpaid dividends, whether or not in
arrears, on the converted shares of Mandatorily Convertible Junior
Preferred Stock, Series B.
(3) In order to convert shares of the Mandatorily
Convertible Junior Preferred Stock, Series B into Common Shares, the
holder thereof (a) shall surrender at the office of the transfer
agent for the Mandatorily Convertible Junior Preferred Stock, Series
B the certificate or certificates therefor if such shares are
certificated, duly endorsed to the Corporation or in blank or
accompanied by appropriate instruments of transfer to the
Corporation or in blank, and (b) shall give written notice to the
Corporation at said office that he elects to convert all or a
portion of such shares. The shares of the Mandatorily Convertible
Junior Preferred Stock, Series B so elected to be converted shall be
deemed to have been converted immediately upon the surrender of the
certificate or certificates for such shares (if such shares are
certificated) for conversion and the giving of such notice of
election in accordance with the foregoing provisions (the date of
each such conversion being a "Conversion Date"), and the person or
persons entitled to receive the Common Shares issuable upon such
conversion shall be treated for all purposes as the record holder or
holders of such Common Shares at such time. If less than all the
shares are elected to be converted, the holder of such Mandatorily
Convertible Junior Preferred Stock, Series B may give one or more
subsequent notices to the Corporation at said office that he elects
to convert a further portion (or all) of the remaining shares of
Mandatorily Convertible Junior Preferred Stock, Series B. If such
holder gives written notice to the Corporation at said office that
he does not intend to convert all of the shares of Mandatorily
Convertible Junior Preferred Stock, Series B, the Corporation, if
requested in writing by such holder, shall, as promptly as
practicable, issue him a new certificate for the shares remaining
unconverted. As promptly as practicable after the Conversion Date,
the Corporation shall issue and deliver at said office the
certificate or certificates for the number of full Common Shares
issuable upon such conversion, and shall deliver a cash payment in
lieu of any fraction of a Common Share, as hereinafter provided, to
the person or persons entitled to receive the same or to the nominee
or nominees of such person or persons.
(4) The Conversion Rate shall be adjusted from time to
time as follows:
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<PAGE> 8
(a) In case the Corporation shall (i) pay a
dividend on its Common Shares in other Common Shares, (ii) subdivide
its outstanding Common Shares, (iii) combine its outstanding Common
Shares into a smaller number of Common Shares, or (iv) issue by
reclassification of its Common Shares any other Common Shares
(including in connection with a merger in which the Corporation is a
surviving corporation), the Conversion Rate in effect at the time of
the record date for such dividend or the effective date of such
subdivision, combination or reclassification shall be
proportionately adjusted, and the shares issuable upon conversion
shall be modified, so that the holder of each share of the
Mandatorily Convertible Junior Preferred Stock, Series B converted
after such time shall be entitled to receive the aggregate number
and kind of shares which, if such share of the Mandatorily
Convertible Junior Preferred Stock, Series B had been converted
immediately prior to such time, the holder would have owned upon
such conversion and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification. Such
adjustment shall be made successively whenever any of the events
listed above shall occur.
(b) In case the Corporation shall issue rights
or warrants to the holders of its Common Shares as such entitling
them (for a period, except in the case of Rights, expiring within 45
days after the record date for determination of the shareholders
entitled to receive such rights or warrants) to subscribe for or
purchase Common Shares at a price per Common Share less than the
current market price per Common Share (as defined in subparagraph
(4) below) on such record date, then in each such case the
Conversion Rate shall be adjusted by multiplying the Conversion Rate
in effect immediately prior to such record date by a fraction, of
which the numerator shall be the number of Common Shares outstanding
on the date of issuance of such rights or warrants plus the number
of additional Common Shares offered for subscription or purchase,
and of which the denominator shall be the number of Common Shares
outstanding on the date of issuance of such rights or warrants plus
the quotient of the aggregate purchase price for all the Common
Shares which may be purchased upon exercise of such rights and
warrants divided by the current market price per Common Share. For
the purposes of this clause (b): (i) Rights shall not be deemed to
have been issued, and the record date therefor shall not be deemed
to have occurred, until the occurrence of the earliest Trigger
Event, if any, to occur; and (ii) the issuance of rights or warrants
to subscribe for or purchase securities convertible into Common
Shares shall be deemed to be the issuance of rights or warrants to
purchase the Common Shares into which such securities are
convertible at an aggregate offering price equal to the aggregate
offering price of such securities plus the minimum aggregate amount
(if any) payable upon conversion of such securities into Common
Shares. Such adjustment shall become effective at the opening of
business on the Business Day next following the record date for such
rights or warrants. To the extent that Common Shares are not
delivered after the expiration of such rights or warrants, the
Conversion Rate shall be readjusted to the Conversion Rate which
would then be in effect had the adjustment made upon the issuance of
such rights or warrants been made upon the basis of the issuance of
rights or warrants in respect of only the number of Common Shares
actually issued upon exercise of such rights or warrants or upon
conversion of the convertible securities issued upon exercise of
such rights or warrants (as the case may be).
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<PAGE> 9
(c) If the Corporation shall pay a dividend or
make a distribution to all holders of its Common Shares consisting
of evidences of its indebtedness or other assets (including capital
shares of the Corporation other than Common Shares but excluding any
Ordinary Cash Dividends (as defined below)), or shall issue to all
holders of its Common Shares rights or warrants to subscribe for or
purchase any of its securities (other than those referred to in
clause (b) above), then in each such case the Conversion Rate shall
be adjusted by multiplying the Conversion Rate in effect on the
record date for such dividend or distribution or the determination
of shareholders entitled to receive such dividend or distribution or
rights or warrants, as the case may be, by a fraction, of which the
numerator shall be the current market price per Common Share
(determined pursuant to subparagraph (4) below) on such record date,
and of which the denominator shall be such current market price per
Common Share less the fair market value as of such record date of
the portion of the assets or evidences of indebtedness so
distributed, or of such subscription rights or warrants, applicable
to one Common Share. Such adjustment shall become effective on the
opening of business on the Business Day next following the record
date for such dividend or distribution or the determination of
shareholders entitled to receive such dividend or distribution or
rights or warrants, as the case may be. "Ordinary Cash Dividends"
shall mean (i) any regular cash dividend on the Common Shares that
does not exceed the per share amount of the immediately preceding
regular cash dividend on the Common Shares (as adjusted to
appropriately reflect any of the events referred to in this
subparagraph (3)) and (ii) any other cash dividend or distribution
which, when combined on a per share basis with the per share amount
of all other cash dividends and distributions paid on the Common
Shares during the 365-day period ending on the date of declaration
of such dividend or distribution (as adjusted to appropriately
reflect any of the events referred to in this subparagraph (3) and
excluding cash dividends or distributions that resulted in an
adjustment to the Conversion Price), does not exceed 10% of the
current market price per Common Share (determined pursuant to
subparagraph (4)) on the Trading Day immediately preceding the date
of declaration of such dividend or distribution.
(5) For the purpose of any computation under subparagraph
(4) above, the "current market price per Common Share" on any date
in question shall be deemed to be the average of the daily Closing
Prices for the five consecutive Trading Days ending on the earlier
of the day in question and, if applicable, the day before the "ex"
date with respect to the issuance or distribution requiring such
computation; provided, however, that if another event occurs that
would require an adjustment pursuant to subparagraph (4), the Board
of Directors of the Corporation may make such adjustments to the
Closing Prices during such five Trading Day period as it reasonably
deems appropriate to effectuate the intent of the adjustments in
subparagraph (4), in which case any such determination by the Board
of Directors of the Corporation shall be set forth in a Board
resolution and shall be conclusive absent manifest error. For
purposes of this paragraph, the term "ex" date, when used with
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<PAGE> 10
respect to any issuance or distribution, means the first date on
which the Common Stock trades in a regular way on the relevant
exchange or in the relevant market from which the Closing Prices
were obtained without the right to receive such issuance or
distribution. For the purpose of any computation under subparagraph
(3) above, the "fair market value" of any assets, evidences of
indebtedness, subscription rights or warrants on any date in
question: (i) in the event any such item is a publicly traded
security, shall be determined for such date pursuant to the
provisions of this subparagraph (5) for determination of the
"current market price per Common Share," except that (x) each
reference therein to "Common Share" or "Common Stock" shall be
deemed to mean such other publicly traded security, and (y) if such
security shall not trade on a "when issued" basis for the five
consecutive Trading Days preceding the "ex" date, such determination
shall be made for the period of five consecutive Trading Days
commencing on the "ex" date; and (ii) in the event any such item is
not a publicly traded security, shall be reasonably determined for
such date by the Board of Directors of the Corporation, as evidenced
by a resolution of the Board, whose determination shall be
conclusive absent manifest error. For the purpose of subparagraph
(4) and this subparagraph (5):
(a) "Closing Price" means the daily closing
price of a Common Share as reported by Bloomberg L.P. for the
Principal Market for the Common Shares or, if such price is not so
reported by Bloomberg L.P., as reported by another recognized
source selected by the Board of Directors.
(b) "Trading Day" means a day on which each of
the (a) New York Stock Exchange, (b) Chicago Board Options Exchange,
and (c) Principal Markets with respect to the Common Shares are
regularly scheduled to be open for trading. For purposes of this
definition, a day on which any such exchange is scheduled to close
(as opposed to unexpectedly closing) prior to its regular closing
time shall not constitute a Trading Day.
(c) "Principal Market" means the principal
exchange on which the Common Shares are traded or the principal
market on which the Common Shares are quoted, as determined by the
Board of Directors.
(6) In any case of any reclassification of Common Shares
(other than a reclassification of the Common Shares referred to in
subparagraph 4(a)), any consolidation or merger of the Corporation
with or into another corporation or other entity (other than a
merger resulting in a reclassification of the Common Shares referred
to in subparagraph 4(a) hereof) or any sale or conveyance to another
corporation (other than a wholly-owned subsidiary of the
Corporation) of all or substantially all of the property of the
Corporation, the holder of a share of the Mandatorily Convertible
Junior Preferred Stock, Series B shall have the right thereafter to
convert such share into the kind and amount of shares of stock and
other securities and property receivable upon such reclassification,
consolidation, merger, sale or conveyance by a holder of the number
of Common Shares into which such share of the Mandatorily
Convertible Junior Preferred Stock, Series B might have been
converted immediately prior to such reclassification, consolidation,
merger, sale or conveyance (assuming that such holder of Common
Shares failed to exercise rights of election, if any, as to the kind
or amount of shares of stock, other securities, cash, or other
property receivable upon consummation of such transaction (provided
that, if the kind or amount of shares of stock, other securities,
cash, or other property receivable upon consummation of such
transaction is not the same for each non-electing share, then the
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<PAGE> 11
kind and amount of shares of stock, other securities, cash or other
property receivable upon consummation of such transaction for each
non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares)) and
shall have no other conversion rights with regard to such share of
Mandatorily Convertible Junior Preferred Stock, Series B. In the
event of such a reclassification, consolidation, merger, sale or
conveyance, effective provision shall be made in the certificate of
incorporation or similar document of the resulting or surviving
corporation or otherwise so that the conversion rate applicable to
any stock or other securities or property into which the shares of
the Mandatorily Convertible Junior Preferred Stock, Series B shall
then be convertible shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Shares contained in clauses
(a) to (c) of subparagraph (4) inclusive, above, and the other
provisions of this paragraph F with respect to the Common Shares
shall apply on terms as nearly equivalent as practicable to any such
other shares of stock and other securities and property deliverable
upon conversion of shares of Mandatorily Convertible Junior
Preferred Stock, Series B.
(7) In the event that any time, as a result of any
adjustment made pursuant to clause (a) of subparagraph (4) above,
the holder of any shares of the Series B Junior Voting Convertible
Preferred Stock thereafter surrendered for conversion shall become
entitled to receive any shares of capital stock of the Corporation
other than Common Shares, thereafter the number of such other shares
so receivable upon conversion of such shares of Mandatorily
Convertible Junior Preferred Stock, Series B shall be subject to
adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provision with respect to the
Common Shares contained in clauses (a) to (c) of subparagraph (4)
inclusive, above, and the other provisions of this paragraph F with
respect to the Common Shares shall apply to any such other shares.
(8) Whenever any adjustments are required in the Common
Shares into which each share of Mandatorily Convertible Junior
Preferred Stock, Series B is convertible, the Corporation shall
forthwith (a) file with the transfer agent of the Mandatorily
Convertible Junior Preferred Stock, Series B a statement describing
in reasonable detail the adjustment and the method of calculation
used and (b) cause a copy of such statement to be mailed to each
holder of record of the Mandatorily Convertible Junior Preferred
Stock, Series B as of the effective date of such adjustment.
(9) The Corporation shall at all times reserve and keep
available out of its authorized but unissued Common Shares for the
purpose of issuance upon conversion of the Mandatorily Convertible
Junior Preferred Stock, Series B the full number of Common Shares
then issuable upon the conversion of all outstanding shares of the
Mandatorily Convertible Junior Preferred Stock, Series B.
(10) The Corporation will pay any and all taxes that may
be payable in respect of the issuance or delivery of Common Shares
on conversion of shares of the Mandatorily Convertible Junior
Preferred Stock, Series B pursuant hereto. The Corporation shall
not, however, be required to pay any tax which may be payable in
respect of any transfer involving issue and delivery of Common
Shares in the name other than that which the shares of Mandatorily
Convertible Junior Preferred Stock, Series B so converted were
registered and no such issue and delivery shall be made unless and
until the person requesting such issue has paid to the Corporation
the amount of any such tax, or has established, to the satisfaction
of the Corporation, that such tax has been paid.
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(11) For the purpose of this paragraph F, the term "Common
Shares" shall include any shares of the Corporation of any class or
series which has no preference or priority in the payment of
dividends or in the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of the
Corporation and which is not subject to redemption by the
Corporation. However, Common Shares issuable upon conversion of the
Mandatorily Convertible Junior Preferred Stock, Series B shall
include only shares of the class designated as Common Shares as of
the original date of issuance of the Mandatorily Convertible Junior
Preferred Stock, Series B, or shares of the Corporation of any
classes or series resulting from any reclassification or
reclassifications thereof and which have no preference or priority
in the payment of dividends or in the distribution of assets upon
any voluntary or involuntary liquidation, dissolution or winding up
of the Corporation and which are not subject to redemption by the
Corporation, provided that if at any time there shall be more than
one such resulting class or series, the shares of such class and
series then so issuable shall be substantially in the proportion
which the total number of shares of such class and series resulting
from all such reclassifications bears to the total number of shares
of all classes and series resulting from all such reclassifications.
(12) No fractional shares or scrip representing fractional
shares shall be issued upon the conversion of the Mandatorily
Convertible Junior Preferred Stock, Series B. If any such conversion
would otherwise require the issuance of a fractional share, an
amount equal to such fraction multiplied by the Closing Price
(determined as provided in subparagraph F(4) above) of the Common
Shares on the date of conversion shall be paid to the holder in cash
by the Corporation. If on such date there is no Closing Price, the
fair value of a Common Share on such date, as reasonably determined
by the Board of Directors of the Corporation as set forth in a
resolution of such Board of Directors, shall be used.
(13) All shares of the Mandatorily Convertible Junior
Preferred Stock, Series B purchased or otherwise acquired by the
Corporation (including shares surrendered for conversion) shall be
canceled and thereupon restored to the status of authorized but
unissued shares of Preferred Stock undesignated as to series.
(14) No adjustment in the Conversion Rate shall be
required unless such adjustment (plus any adjustments not previously
made by reason of this subparagraph (14)) would require an increase
or decrease of at least 1% in the number of Common Shares into which
each share of the Series B Junior Convertible Preferred Stock is
then convertible; provided, however, that any adjustments which by
reason of this subparagraph (14) are not required to be made shall
be carried forward and taken into account in any subsequent
adjustment. All calculations under this paragraph F shall be made to
the nearest one-thousandth of a share.
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(15) The Board of Directors may make such upward
adjustments in the Conversion Rate, in addition to those required by
this paragraph F, as shall be determined by the Board, as evidenced
by a Board resolution, to be advisable in order to avoid taxation so
far as practicable of any dividend of stock rights or any event
treated as such for Federal income tax purposes to the recipients.
The determination of the Board of Directors as to whether an
adjustment should be made pursuant to the provisions of this
subparagraph (15), and if so, as to what adjustment should be made
and when, shall be conclusive, final and binding on the Corporation
and all stockholders of the Corporation.
(16) Notwithstanding the foregoing provisions of this
paragraph F, no adjustment of the Conversion Rate shall be required
to be made upon the issuance of any shares of Common Stock pursuant
to any present or future plan providing for the reinvestment of
dividends or interest payable on securities of the Corporation and
the investment of additional optional amounts in shares of Common
Stock under any such plan.
(17) Notwithstanding any other provision of this paragraph
F, the issuance or distribution of Rights shall not be deemed to
constitute an issuance or a distribution or dividend of rights,
warrants, or other securities to which any of the adjustment
provisions described above applies until the occurrence of the
earliest Trigger Event.
(18) For purposes of this paragraph F, shares of Common
Stock owned by, or held for the account of, the Corporation or
another entity of which a majority of the capital stock or equity
interests having ordinary voting power are owned, directly or
indirectly, by the Corporation shall be deemed to be not
outstanding.
G. Voting Rights. The holders of Mandatorily Convertible Junior
Preferred Stock, Series B shall have no right to vote except as otherwise
specifically provided herein, in the Articles of Incorporation, as amended,
of the Corporation, or as required by statute.
(1) So long as any shares of Mandatorily Convertible
Junior Preferred Stock, Series B are outstanding, in addition to any
other vote or consent of shareholders required in the Articles of
Incorporation or by law, the consent of the holders of at least a
majority of the Mandatorily Convertible Junior Preferred Stock,
Series B and all other shares of parity stock, if any, at the time
outstanding that would be affected similarly by the action described
in clauses (a)-(d) below and that are entitled to vote on such
matter, given in person or by proxy, either in writing without a
meeting (if permitted by law) or by vote at any meeting called for
the purpose, shall be necessary for effecting or validating:
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(a) any amendment, alteration or repeal of any
of the provisions of the Articles of Incorporation of the
Corporation, which affects adversely the voting powers, rights or
preferences of the holders of the Mandatorily Convertible Junior
Preferred Stock, Series B; provided, that the amendment of the
provisions of the Articles of Incorporation so as to authorize or
create, or to increase the authorized amount of, any senior or
junior stock or to issue additional shares of the Mandatorily
Convertible Junior Preferred Stock, Series B as required by the
Share Settlement Agreement shall not be deemed to affect adversely
the voting powers, rights or preferences of the holders of the
Mandatorily Convertible Junior Preferred Stock, Series B;
(b) the sale, lease or conveyance by the
Corporation of all or substantially all of its property or assets;
(c) 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 Mandatorily Convertible Junior
Preferred Stock, Series B (other than the issuance of additional
shares of the Mandatorily Convertible Junior Preferred Stock, Series
B as required by the Share Settlement Agreement); or
(d) the merger or consolidation of the
Corporation with or into any other corporation or other entity,
unless each holder of shares of Mandatorily Convertible Junior
Preferred Stock, Series B immediately preceding such merger or
consolidation shall receive or continue to hold in the surviving or
resulting corporation or other entity the same number of shares,
with substantially the same rights and preferences (except as
contemplated by subparagraph F(6) and except for those rights and
preferences that could be affected without the vote of the holders
of the Mandatorily Convertible Junior Preferred Stock, Series B,
such as the authorization and issuance of senior stock), as
correspond to the shares of Mandatorily Convertible Junior Preferred
Stock, Series B held immediately prior to such merger or
consolidation.
(2) (a) In the event that full cumulative dividends on the
Mandatorily Convertible Junior Preferred Stock, Series B are not
paid for six consecutive Dividend Periods, the number of directors
of the Corporation constituting the entire Board of Directors shall
be increased by two persons and the holders of shares of the
Mandatorily Convertible Junior Preferred Stock, Series B, voting
separately as a class together with the holders of shares of all
other series of capital stock of the Corporation ranking on a parity
with the Mandatorily Convertible Junior Preferred Stock, Series B as
to the payment of dividends and having the then present right to
elect one or more directors as a result of a dividend arrearage but
not then entitled to other separate voting rights to elect one or
more directors in the event of such an arrearage (herein referred to
as "Class Voting Stock"), shall have the right to elect such
additional two directors to fill such positions at any regular
meeting of shareholders or special meeting held in place thereof, or
at a special meeting called as provided in subparagraph 2(b) below.
Whenever all arrearages of dividends on the Mandatorily Convertible
14
<PAGE> 15
Junior Preferred Stock, Series B then outstanding shall have been
paid or declared and irrevocably set apart for payment, then the
right of the holders of shares of the Mandatorily Convertible Junior
Preferred Stock, Series B (and, subject to the terms of such other
Class Voting Stock, such other Class Voting Stock) to elect such
additional two directors shall cease (but subject always to the same
provisions for the vesting of such voting rights in the case of any
similar future arrearages in dividends), and the terms of office of
all persons previously elected as directors by the holders of shares
of the Mandatorily Convertible Junior Preferred Stock, Series B and
such other Class Voting Stock shall forthwith terminate and the
number of the Board of Directors shall be reduced accordingly.
(b) At any time after the voting power referred
to in subparagraph 2(a) above shall have been so vested in the
holders of shares of the Mandatorily Convertible Junior Preferred
Stock, Series B, the Secretary of the Corporation may, and upon the
written request of any holder or the holders of at least 10% of the
number of shares of Mandatorily Convertible Junior Preferred Stock,
Series B then outstanding (addressed to the Secretary at the
principal executive office of the Corporation) shall, call a special
meeting of the holders of shares of the Mandatorily Convertible
Junior Preferred Stock, Series B and all other Class Voting Stock
for the election of the directors to be elected by them pursuant to
subparagraph 2(a); provided that the Secretary shall not be required
to call such special meeting if the request for such meeting is
received less than 45 calendar days before the date fixed for the
next ensuing annual meeting of shareholders. Such call shall be made
by notice similar to that provided in the bylaws of the Corporation
for a special meeting of the shareholders or as required by law.
Subject to the foregoing provisions, if any such special meeting
required to be called as above provided shall not be called by the
Secretary within 20 calendar days after receipt of an appropriate
request, then any holder of shares of Mandatorily Convertible Junior
Preferred Stock, Series B may call such meeting, upon the notice
above provided, and for that purpose shall have access to the stock
books and records of the Corporation. Except as otherwise provided
by law, at any such meeting, the holders of a majority of the number
of shares of Mandatorily Convertible Junior Preferred Stock, Series
B and such other Class Voting Stock then outstanding shall
constitute a quorum for the purpose of electing directors as
contemplated in subparagraph 2(a) above. If at any such meeting or
adjournment thereof a quorum of such holders of Mandatorily
Convertible Junior Preferred Stock, Series B and such other Class
Voting Stock shall not be present, no election of directors by the
Mandatorily Convertible Junior Preferred Stock, Series B and such
other Class Voting Stock shall take place, and any such meeting may
be adjourned from time to time for periods not exceeding 30 calendar
days until a quorum of the Mandatorily Convertible Junior Preferred
Stock, Series B and the Class Voting Stock is present at such
adjourned meeting. Unless otherwise provided by law or the Articles
of Incorporation, as amended, directors to be elected by the holders
of shares of Mandatorily Convertible Junior Preferred Stock, Series
B and such other Class Voting Stock shall be elected by a plurality
of the votes cast by such holders at a meeting at which a quorum is
present. Notwithstanding the foregoing, the absence of a quorum of
the Mandatorily Convertible Junior Preferred Stock, Series B and
such other Class Voting Stock shall not prevent the voting of,
including the election of, directors by the holders of Common Stock
and other classes of capital stock at such meeting.
15
<PAGE> 16
(c) Any director who shall have been elected by
holders of shares of Mandatorily Convertible Junior Preferred Stock,
Series B (or by the holders of shares of Mandatorily Convertible
Junior Preferred Stock, Series B, voting separately as a class
together with the holders of one or more other series of Class
Voting Stock), or any director so elected as provided below, may be
removed at any time during a class voting period, either for or
without cause, by, and only by, the affirmative vote of the holders
of a majority of the number of shares of Mandatorily Convertible
Junior Preferred Stock, Series B then outstanding, voting separately
as a class together with the holders of all other series of Class
Voting Stock then outstanding, if any, given at a special meeting of
such shareholders called for the purpose, and any vacancy thereby
created may be filled during such class voting period only by the
holders of shares of Mandatorily Convertible Junior Preferred Stock,
Series B and the other series, if any, of Class Voting Stock. In
case any vacancy (other than as provided in the preceding sentence)
shall occur among the directors elected by the holders of shares of
the Mandatorily Convertible Junior Preferred Stock, Series B (and
such other Class Voting Stock), a successor shall be elected by the
Board of Directors to serve until the next annual meeting of the
shareholders or special meeting held in place thereof upon the
nomination of the then remaining director elected by the holders of
the Mandatorily Convertible Junior Preferred Stock, Series B (and
such other Class Voting Stock) or the successor of such remaining
director.
(3) Holders of Mandatorily Convertible Junior Preferred
Stock, Series B shall not be entitled to receive notice of any
meeting of shareholders at which they are not entitled to vote or
consent.
H. Other Rights. Shares of Mandatorily Convertible Junior
Preferred Stock, Series B shall not have any relative, participating, optional
or other special rights or powers other than as set forth herein or in the
Articles of Incorporation, as amended.
16
<PAGE> 1
EXHIBIT 5
February 29, 2000
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Gentlemen:
As Executive Vice President and General Counsel of Enron Corp., an
Oregon corporation ("Enron"), I am familiar with Post-Effective Amendment No. 1
to Registration Statement No. 333-70465 of Enron on Form S-3 (the "Registration
Statement") relating to the registration of an additional 7.5 million shares of
Enron Corp. Common Stock, and the proposed offering from time to time of (i) up
to an aggregate amount of $500,000,000 of Enron Debt Securities, Enron Preferred
Stock and Depositary Shares, and (ii) up to 15 million shares of Enron Common
Stock, no par value (the Debt Securities, Preferred Stock, Depositary Shares 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.
<PAGE> 2
(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 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.
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 Oregon
Business Corporation Act 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
(Dollars in Millions)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months
Ended Year Ended December 31,
---------------------------------------------------------------------------------
9/30/99 1998 1997 1996 1995 1994
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earnings available for fixed charges
Net income before cumulative
effect of accounting changes $ 765 $ 703 $105 $ 584 $ 520 $ 453
Less:
Undistributed earnings and
losses of less than 50% owned
affiliates (19) (44) (89) (39) (14) (9)
Capitalized interest of
nonregulated companies (51) (66) (16) (10) (8) (9)
Add:
Fixed charges(a) 776 809 674 454 436 487
Minority interests 94 77 80 75 27 30
Income tax expense (benefit) 99 204 (65) 297 310 190
---------------------------------------------------------------------------------
Total $1,664 $1,683 $689 $1,361 $1,271 $1,142
=================================================================================
Preferred dividend requirements $ 42 $ 17 $ 17 $ 16 $ 16 $ 15
Ratio of income before provision
for income taxes to net income(b) 1.09 1.25 1.21 1.46 1.55 1.37
---------------------------------------------------------------------------------
Preferred dividend factor on a
pretax basis $ 46 $ 21 $ 21 $ 23 $ 25 $ 21
Fixed Charges
Interest expense(a) 740 760 624 404 386 445
Rental expense representative
of interest factor 36 49 50 50 50 42
---------------------------------------------------------------------------------
Total $ 822 $ 830 $695 $ 477 $ 461 $ 508
=================================================================================
Ratio of earnings to combined
fixed charges and preferred
dividends 2.03 2.03 (c) 2.85 2.76 2.25
=================================================================================
</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 year ended December 31, 1997, earnings were inadequate to cover
combined fixed charges and preferred stock dividends by $6 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 March 5, 1999
included in Enron Corp.'s Form 8-K dated March 18, 1999 and Form 10-K for the
year ended December 31, 1998 and to all references to our Firm included in this
Registration Statement.
ARTHUR ANDERSEN LLP
Houston, Texas
February 29, 2000
<PAGE> 1
EXHIBIT 23.02
DeGolyer and MacNaughton
One Energy Square
Dallas, Texas 75206
February 22, 2000
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Gentlemen:
In connection with the Post-Effective Amendment No. 1 to Registration
Statement No. 333-70465 on Form S-3 (the Registration Statement), to be filed
with the Securities and Exchange Commission on or about February 22, 2000, by
Enron Corp., DeGolyer and MacNaughton (the firm) hereby consents to the
incorporation in said Registration Statement of the references to the firm and
to the opinions delivered to Enron Oil & Gas Company (the Company) regarding the
comparison of estimates prepared by the firm with those furnished to it 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 the firm's letter reports dated January 17, 1997, and January 13,
1998, and January 11, 1999, for estimates, as of December 31, 1996, December 31,
1997, and December 31, 1998, 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, 1998, and in Note 18 to the Enron Corp. consolidated
financial statements included in Enron Corp.'s Form 10-K for the year ended
December 31, 1998. DeGolyer and MacNaughton also consents to the incorporation
by reference in the Registration Statement of the firm's letter report, dated
January 11, 1999, 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,
1998. DeGolyer and MacNaughton also consents to the references to the firm in
the section "Experts" in the Prospectus that is a part of the Registration
Statement.
Very truly yours,
/s/ DeGOLYER AND MacNAUGHTON
-----------------------------
DeGOLYER AND MacNAUGHTON
<PAGE> 1
EXHIBIT 24
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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ KEN L. HARRISON
--------------------------
Ken L. Harrison
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ ROBERT K. JAEDICKE
--------------------------
Robert K. Jaedicke
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ KENNETH L. LAY
--------------------------
Kenneth L. Lay
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ CHARLES A. LeMAISTRE
--------------------------
Charles A. LeMaistre
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ REBECCA P. MARK
--------------------------
Rebecca P. Mark
<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 and 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 Rebecca C.
Carter, 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 19th
day of December, 1999.
/s/ JOHN MENDELSOHN
--------------------------
John Mendelsohn
<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 and 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 Rebecca C.
Carter, 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 19th
day of December, 1999.
/s/ JEROME J. MEYER
--------------------------
Jerome J. Meyer
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ JEFFREY K. SKILLING
--------------------------
Jeffrey K. Skilling
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ JOHN A. URQUHART
--------------------------
John A. Urquhart
<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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ JOHN WAKEHAM
--------------------------
John Wakeham
<PAGE> 16
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 and 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 Rebecca C.
Carter, 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 14th
day of December, 1999.
/s/ HERBERT S. WINOKUR, JR.
---------------------------
Herbert S. Winokur, Jr.
