<PAGE> 1
As filed with the Securities and Exchange Commission on June 30, 1995
Registration No. 33-
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM S-3
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
_______________
WEST TEXAS UTILITIES COMPANY
(Exact name of registrant as specified in its charter)
Texas 75-0646790
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
301 Cypress
Abilene, Texas 79601
(915) 674-7000
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
_______________
GLENN FILES, President GEORGE J. FORSYTH, Esq.
and Chief Executive Officer Milbank, Tweed, Hadley & McCloy
West Texas Utilities Company 1 Chase Manhattan Plaza
301 Cypress New York, New York 10005
Abilene, Texas 79601 (212) 530-5000
(915) 674-7000
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
______________
Approximate date of commencement of proposed sale to the public: From
time to time after the Registration Statement becomes effective.
_______________
<PAGE> 2
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
_______________
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
_______________
CALCULATION OF REGISTRATION FEE
============================================================================
PROPOSED
MAXIMUM
TITLE OF EACH AGGREGATE AMOUNT OF
CLASS OF SECURITIES OFFERING REGISTRATION
TO BE REGISTERED PRICE* FEE
----------------------------------------------------------------------------
First Mortgage
Bonds........................ $45,000,000 $15,517**
============================================================================
* Estimated solely for the purpose of calculating the registration fee.
** $20,000,000 of the Company's First Mortgage Bonds, for which a
registration fee of $6,897 was previously paid, are being carried
forward from Registration Statement No. 33-50633.
_______________
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 the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
Pursuant to Rule 429 of the Commission under the Securities Act of 1933,
as amended, the within Prospectus relates to $45,000,000 of the Company's
First Mortgage Bonds covered hereby and to $20,000,000 of the Company's First
Mortgage Bonds covered by Registration Statement No. 33-50633.
============================================================================
<PAGE> 3
************************************************
* SUBJECT TO COMPLETION, DATED JUNE 30, 1995 *
************************************************
PROSPECTUS
$65,000,000
FIRST MORTGAGE BONDS
OF
WEST TEXAS UTILITIES COMPANY
_______________
West Texas Utilities Company (the "Company") intends to offer from time
to time, in one or more series, up to $65,000,000 aggregate principal amount
of its First Mortgage Bonds (the "New Bonds") in amounts, at prices and on
terms to be determined at the time of offering.
The series designation, aggregate principal amount, maturity, interest
rate and interest payment dates, redemption provisions, sinking fund
provisions, initial public offering price and any other specific terms of each
series of the New Bonds, in respect of which this Prospectus is being
delivered, will be set forth in a Prospectus Supplement (the "Prospectus
Supplement") to be delivered at the time of the offering and sale of the New
Bonds. See "DESCRIPTION OF THE NEW BONDS" herein.
_______________
The Company may sell the New Bonds in one or more series to or through
underwriters or dealers designated from time to time through competitive
bidding, or through negotiation, or directly to other purchasers or through
agents. The Prospectus Supplement applicable to any series of New Bonds will
set forth the initial public offering price, the proceeds to the Company, the
names of any purchasers, underwriters or agents and any applicable discounts
or commissions with respect to the New Bonds being offered. See "PLAN OF
DISTRIBUTION".
_______________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
_______________
The Date of this Prospectus is , 1995.
*****************************************************************************
* 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, solici- *
* tation or sale would be unlawful prior to registration or qualification *
* under the securities laws of any such State. *
*****************************************************************************
<PAGE> 4
No dealer, salesman or any other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus and, with respect to any series of New Bonds, the
Prospectus Supplement relating thereto, and if given or made, such information
or representation must not be relied upon as having been authorized by the
Company or any underwriter, dealer or agent. Neither this Prospectus nor any
Prospectus Supplement constitutes an offer to sell or a solicitation of an
offer to buy any of the securities offered hereby or thereby in any
jurisdiction to any person to whom it is unlawful to make such offer in such
jurisdiction. Neither the delivery of this Prospectus or any Prospectus
Supplement nor any sale made hereunder or thereunder shall, under any
circumstances, create any implication that there has been no change in the
affairs of the Company since the date hereof or thereof or that the
information contained or incorporated by reference herein or therein is
correct as of any time subsequent to its date.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and in
accordance therewith files reports and other information with the Securities
and Exchange Commission (the "Commission"). Such reports and other
information filed by the Company can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549-1004; and at the Commission's Regional Offices at 500
West Madison St., Suite 1400, Chicago, Illinois 60661-2511 and Seven World
Trade Center, 13th Floor, New York, New York 10048. Copies of such material
can also be obtained at prescribed rates from the Public Reference Section of
the Commission at its principal office at 450 Fifth Street, N.W., Washington,
D.C. 20549.
It is the Company's current practice to prepare and mail to the holders
of its Preferred Stock copies of the Company's annual financial reports. Such
reports contain certain financial information that is examined and reported
upon, with an opinion expressed, by the Company's independent public
accountants. The Company is not required to and does not provide annual
reports to the holders of its debt securities unless specifically requested by
such a holder. In addition, certain of the Company's securities are listed
on, and reports and other information concerning the Company can also be
inspected at, the New York Stock Exchange, 20 Broad Street, New York, New York
10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company with the
Commission pursuant to the Exchange Act are incorporated by reference in this
Prospectus.
1. The Company's Annual Report on Form 10-K for the year ended
December 31, 1994.
<PAGE> 5
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1995.
3. The Company's Current Report on Form 8-K dated February 17, 1995.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the New Bonds shall be deemed to
be incorporated by reference into this Prospectus from their respective dates
of filing.
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON,
INCLUDING ANY BENEFICIAL OWNER, TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED,
UPON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF
THE FOREGOING DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN EXHIBITS
TO SUCH DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED BY REFERENCE INTO
THE INFORMATION THAT THE REGISTRATION STATEMENT INCORPORATES). WRITTEN OR
TELEPHONE REQUESTS SHOULD BE DIRECTED TO STEPHEN D. WISE, DIRECTOR, FINANCE,
CENTRAL AND SOUTH WEST CORPORATION, 1616 WOODALL RODGERS FREEWAY, DALLAS,
TEXAS 75202, AS AGENT FOR THE COMPANY, TELEPHONE NUMBER (214) 777-1000.
<PAGE> 6
PROSPECTUS SUMMARY
The following material is qualified in its entirety by, and should be
read in conjunction with, the information appearing elsewhere in this
Prospectus, in the applicable Prospectus Supplement and in the documents,
financial statements and other information incorporated by reference in this
Prospectus.
THE OFFERING
Company........................ West Texas Utilities Company
Amount and Type of Security.... Not exceeding $65,000,000 First
Mortgage Bonds
Interest Payment Dates......... Semiannually on dates to be determined
Maturity Date.................. To be determined
Redemption..................... To be determined
Security....................... Secured, together with all other
outstanding First Mortgage Bonds, by
a mortgage on substantially all of
the Company's properties
Use of Proceeds................ To reimburse the Company's treasury
for the redemption or repurchase of
all or a portion of certain of the
Company's First Mortgage Bonds,
together with costs associated with
the issuance of the New Bonds, to
repay short-term debt, to provide
working capital or for other general
corporate purposes
THE COMPANY
Business....................... A public utility engaged in the
production, purchase, transmission,
distribution and sale of electricity
Service Area................... Approximately 53,000 square miles in
central west Texas
Population of Service Area
(December 31, 1994)........... Approximately 410,000
Customers (December 31, 1994).. Approximately 185,000
<PAGE> 7
<TABLE>
SELECTED FINANCIAL INFORMATION
(Dollars in Thousands)
<CAPTION>
Twelve Year Ended December 31,
Months Ended ---------------------------------
March 31, 1995 1994 1993 1992
-------------- --------- --------- ---------
(Unaudited)
<S> <C> <C> <C> <C>
Operating Revenues.................. $334,593 $342,991 $345,445 $315,370
Operating Income.................... 56,172 54,763 46,576 57,302
Net Income Before Cumul-
ative Effect of a Change
in Accounting Principles........... 38,052 37,366 26,517 35,007
Cumulative Effect of a
Change in Accounting
Principles......................... - - 3,779 -
Net Income.......................... 38,052 37,366 30,296 35,007
Net Utility Plant................... 665,316 663,855 653,426 651,221
Capitalization at
March 31, 1995
---------------------
(Unaudited)
Long-Term Debt...................... $250,415 47.0%
Preferred Stock..................... 6,291 1.2
Common Equity....................... 276,121 51.8
-------- ------
$532,827 100.0%
======== ======
</TABLE>
<PAGE> 8
THE COMPANY
West Texas Utilities Company, a Texas corporation, is a public utility
company engaged in the production, purchase, transmission, distribution and
sale of electricity in central west Texas. Central and South West
Corporation, a registered public utility holding company under the Public
Utility Holding Company Act of 1935, owns all of the issued and outstanding
Common Stock of the Company. The Company's executive offices are located at
301 Cypress, Abilene, Texas 79601, telephone number (915) 674-7000.
Ratio of Earnings to Fixed Charges (unaudited):
Twelve Year Ended December 31,
Months Ended ------------------------------------------------
March 31, 1995 1994 1993 1992 1991 1990
-------------- ---- ---- ---- ---- ----
(Unaudited)
3.32 3.37 2.79 3.22 3.30 3.05
For computation of the ratio: (i) earnings consist of operating income
plus Federal income taxes, deferred income taxes and investment tax credits,
other income and deductions and allowance for funds (both borrowed and equity)
used during construction; and (ii) fixed charges consist of interest on long-
term debt and other interest charges.
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement, the Company
intends to use the net proceeds from the sale of the New Bonds offered hereby
to redeem, repurchase or reimburse the Company's treasury for the redemption
or repurchase of, certain of the Company's outstanding First Mortgage Bonds,
and to pay costs associated with the issuance of the New Bonds. The balance
of the net proceeds, if any, will be used to repay outstanding short-term
borrowings, to provide working capital or for other general corporate
purposes.
DESCRIPTION OF THE NEW BONDS
The following description sets forth certain general terms and
provisions of the New Bonds to which any Prospectus Supplement may relate.
The particular terms of the New Bonds offered by any Prospectus Supplement and
the extent, if any, to which such general provisions may apply to the New
Bonds so offered will be described therein.
The New Bonds will be issued in one or more series under and secured by
the Company's Indenture, dated August 1, 1943, between the Company and Harris
Trust and Savings Bank (the "Trustee") and J. Bartolini, successor co-Trustee,
as Trustees, as heretofore amended and as to be further amended in connection
with the sale of each series of New Bonds by a supplemental indenture (the
"Supplemental Indenture") to be entered into in connection with the creation
<PAGE> 9
and issuance of the New Bonds of any series (collectively the "Indenture").
All bonds (including the New Bonds) which may from time to time be issued and
outstanding under the Indenture are herein referred to as "Bonds."
The following statements, unless the context otherwise indicates, are
brief summaries of certain provisions of the Indenture. Such statements make
use of defined terms, are not complete and are subject to all the provisions
of the Indenture. The Indenture is in part filed as an exhibit to, and in
part incorporated by reference in, the Registration Statement of which this
Prospectus is a part.
GENERAL. Reference is made to the Prospectus Supplement relating to the
particular series of New Bonds offered thereby for the following terms or
additional provisions: (1) the title of the New Bonds offered thereby; (2) the
aggregate principal amount of the series of New Bonds; (3) the date or dates
on which the New Bonds of the series will mature; (4) the rate per annum at
which the New Bonds of the series will bear interest; (5) the date from which
interest on the New Bonds of the series will accrue, the dates on which such
interest will be payable and the record dates of any interest payment dates;
(6) if applicable, the date after which and the prices at which the New Bonds
of the series may be redeemed at the option of the Company; and (7) any
additional terms of the New Bonds.
The New Bonds will be issuable in definitive fully registered form
without coupons, in denominations of $1,000 or in integral multiples thereof.
Principal, premium, if any, and interest on the New Bonds will be payable at
the office or agency of the Company in the City of New York, State of New
York. The New Bonds are exchangeable and transferable as provided in the
Indenture and without charge therefor, except for any stamp tax or other
governmental charge; provided, that the Company (a) shall not register,
exchange or transfer New Bonds during the ten days preceding any interest
payment date thereof and (b) shall not be required to register, exchange or
transfer New Bonds during the period beginning ten days preceding any date for
selection of New Bonds to be called for redemption and ending on the date of
the giving of the relevant notice of redemption and, as to New Bonds selected
for redemption, from and after the date of such selection.
DEBT RETIREMENT. The Debt Retirement provisions, if any, for each
series of New Bonds will be described in the Prospectus Supplement relating
thereto. The Bonds of Series O, outstanding under the Indenture on the date
of this Prospectus, provide that, during each 12-month period specified in the
Indenture, the Company will (a) retire, or pay to the Trustee on the first day
of April of each year a sum of money sufficient to redeem and retire, 1% of
the greatest principal amount of the Bonds of such series outstanding at any
time between the end of such period and the day before the date of the
Supplemental Indenture relating to such series of Bonds (the "Supplemental
Indenture Date") or (b) to the extent that Bonds of such series are not so
retired or cash so deposited, make and certify to the Trustee $1,666.67 of net
expenditures for bondable property on which the Indenture is a first lien,
subject only to permitted encumbrances and liens and prepaid liens, for each
$1,000 of Bonds of such series otherwise required to be retired. Unused net
<PAGE> 10
expenditures for bondable property and, as applied to each such series of
Bonds, unused excess retirements of Bonds of that series, may be used to
satisfy the foregoing provisions.
REDEMPTION. The optional redemption provisions, if any, for each series
of the New Bonds will be described in the Prospectus Supplement relating
thereto.
MAINTENANCE AND RENEWAL. The Indenture provides that so long as Bonds
of Series I through T are outstanding, the Company is required to expend
during each calendar year an amount equal to at least 2.9% (unless modified
upon application to the Commission) of the average amount of depreciable
property for (1) the construction or acquisition of bondable property on which
the Indenture is a first lien, subject only to permitted encumbrances and
liens and prepaid liens, or (2) the retirement, through purchase or payment of
Bonds issued under the Indenture, or redemption of Bonds issued under the
Indenture that are subject to redemption. The Company may take a credit for
use in subsequent years for the amount of excess expenditures made in any
preceding year or years. If the required expenditures for the foregoing
purposes are not so made, the Company shall deposit with the Trustee cash to
the extent of any deficiency, after deducting (subject to the terms of the
Indenture) any eligible credit for unused excess expenditures previously made
for such purposes. Such cash may be applied to the redemption at the
applicable General Redemption Price or to the repurchase of Bonds or withdrawn
to the extent of 100% of either net expenditures or excess gross expenditures
for such bondable property.
The Indenture also provides that (a) the Company shall maintain the
mortgaged properties in thorough repair, working order and condition, (b) the
Trustee may, and if requested by holders of a majority in principal amount of
all outstanding Bonds and furnished with funds therefor shall, cause such
properties to be inspected by an independent engineer (not more often than at
five-year intervals) to determine whether they have been so maintained and
whether any property, not retired on the Company's books, should be classified
as retired for the purpose of computing net expenditures for bondable property
or otherwise under the Indenture, and (c) the Company shall make good any
deficiency in maintenance disclosed by such engineer's report as rendered or
as modified by arbitration.
SECURITY. The New Bonds of any series will be secured by the lien of
the Indenture and will rank equally with all Bonds at any time outstanding
under and secured by the Indenture, except as to differences between series
permitted by the Indenture and not affecting the rank of the lien. The
Indenture will constitute a first mortgage lien, subject only to permitted
encumbrances and liens and prepaid liens, on all or substantially all the
permanent fixed properties, other than excepted property, owned by the
Company. The Indenture contains provisions subjecting after-acquired
property, other than excepted property, to the lien thereof. Such provisions
may not be effective as to property or proceeds acquired subsequent to the
filing of any case under the Bankruptcy Code. The Indenture excepts from the
lien thereof all cash, securities, accounts and bills receivable, choses in
action and certain judgments not deposited with, assigned to or pledged with
<PAGE> 11
the Trustee, all tangible personal property held for sale, rental or
consumption in the ordinary course of business, the last day of each term
under any lease of property, all oil, gas and mineral leaseholds, interests
and estates, gas gathering lines and certain real estate described therein.
ISSUANCE OF ADDITIONAL BONDS. The Indenture does not fix an overall
limitation on the aggregate principal amount of Bonds of all series that may
be outstanding thereunder. An aggregate of $235,203,000 in principal amount
of Bonds was outstanding under the Indenture on March 31, 1995.
Additional Bonds, of a new or an existing series, may be issued from
time to time under the Indenture, subject to the terms thereof, in a principal
amount equal to: (a) 60% of eligible net expenditures made by the Company for
bondable property constructed or acquired by it on or after August 1, 1943,
and on which the Indenture is a first lien, subject only to permitted
encumbrances and liens and prepaid liens, (b) the principal amount of Bonds
previously authenticated under the Indenture and which have been retired or
for the retirement of which the Trustee holds the necessary funds, other than
Bonds made ineligible for the purpose by the terms of the Indenture (which
Bonds so made ineligible include Bonds retired through the operation of the
debt retirement and the maintenance and renewal provisions of the Indenture),
and (c) the amount of money deposited with the Trustee for the purpose, which
money may be applied to the retirement of Bonds or may be withdrawn in lieu of
the authentication of an equivalent principal amount of Bonds under the
Indenture provisions referred to in clauses (a) and (b). Net expenditures for
bondable property are determined as provided in the Indenture. In general,
bondable property, the net expenditures for which are eligible as a basis for
issuance of additional Bonds, means any electric utility plant, property or
equipment owned by the Company on August 1, 1943, or constructed or acquired
by it on or after that date which is used or useful in its utility business
and which the Company has lawful power to own and operate.
No additional Bonds may be authenticated under the Indenture provisions
referred to in clauses (a) and (c) above, and no Bonds bearing a higher rate
of interest than the Bonds for the retirement of which they are to be issued
may be authenticated under the Indenture provisions referred to in clause (b)
above, more than five years before maturity of the Bonds to be retired,
unless, in each case, net earnings of the Company for a 12-month period ending
within 90 days preceding such authentication were at least equal to twice the
interest for one year on (1) all of the Bonds of all series to be outstanding
under the Indenture immediately after such authentication, other than Bonds
for which the Trustee holds the funds necessary for retirement, and (2) all
other indebtedness then secured by a lien equal or prior to the Indenture on
property of the Company, except any of such indebtedness then held in pledge
under such lien or by the Trustee and except prepaid liens. Net earnings for
the period in question are determined by deducting from total gross earnings
and income all operating expenses for the period, including taxes other than
income taxes, rentals and insurance and all charges or provisions for
maintenance and repairs and for depreciation, retirements, renewals,
replacements and amortization, provided that charges or provisions to be
deducted for such purposes shall aggregate at least the amount required to be
<PAGE> 12
certified in connection with the maintenance and renewal fund under the
Indenture, described under "Maintenance and Renewal" above. Such net earnings
are also subject to any other adjustment required by the Indenture.
Based on the bondable property test described above, which is currently
the most restrictive of the Indenture's issuance tests, and without taking
into account the retirement of any Bonds with the proceeds of the New Bonds,
the Company, as of May 31, 1995, could have issued approximately $25,025,739
principal amount of additional Bonds.
The Company anticipates that the New Bonds will be authenticated under
the Indenture against retired Bonds of prior series, to the extent available,
or against unused net expenditures for bondable property to the extent
permitted in the Indenture. At May 31, 1995, the Company had approximately
$63,847,000 principal amount of previously retired Bonds available for
authentication of additional Bonds and such unused net expenditures aggregated
approximately $41,709,565.
ACQUISITION OF PROPERTY SUBJECT TO A PRIOR LIEN. The Indenture provides
that the Company will not acquire any property of a value in excess of
$500,000 which at the time of acquisition is subject to a lien equal or prior
to the Indenture (other than permitted encumbrances and liens and prepaid
liens) unless at that time (a) the principal amount of all outstanding
obligations secured by such equal or prior lien shall not exceed 60% of the
fair value of any bondable property so acquired and (b) the net earnings
derived from the operations of such property during a 12-month period ending
within 90 days immediately preceding such acquisition were equal to at least
twice the annual interest charge on such obligations, except obligations owned
by the Company or obligations for the retirement of which funds are deposited
under such lien or with the Trustee.
LIMITATIONS ON DIVIDENDS ON COMMON STOCK. Unless otherwise specified in
a Prospectus Supplement relating to a particular series of New Bonds, the
Supplemental Indenture for each series of New Bonds will not contain
provisions restricting the payment of dividends on Common Stock by the
Company. Dividend restrictions dependent upon earned surplus are binding on
the Company so long as certain prior series of the Company's Bonds are
outstanding. The Indenture provides in effect that, so long as any Bonds of
Series O or a prior series are outstanding, the aggregate amount of all
dividends and distributions on the Common Stock of the Company on and after
the Supplemental Indenture Date for such series, except dividends payable in
shares of Common Stock of the Company or in cash where concurrently with the
payment thereof an amount at least equal to such dividends is received in cash
as a capital contribution or as the proceeds from the sale of Common Stock,
shall not exceed the sum of (a) the earned surplus of the Company earned on
and after the Supplemental Indenture Date for such series, (b) its earned
surplus at the Supplemental Indenture Date for such series, and (c) such
additional amount as may be approved by the Commission. In determining earned
surplus on and after the Supplemental Indenture Date for such series for such
purpose, deductions are required to be made for depreciation, retirements,
renewals, replacements and amortization as required in computing net earnings
as set forth in the next to last sentence of the third paragraph under the
subheading "Issuance of Additional Bonds" above.
<PAGE> 13
Because dividend restrictions for prior series require minimum
deductions for maintenance and repairs based on operating revenues, the
Company began several years ago to incur deficiencies which had the effect of
increasing dividend restrictions. The Company therefore obtained an order
from the Commission permitting the payment, out of earned surplus after
December 31, 1978, of dividends not otherwise permitted under the Company's
most restrictive supplemental indentures, by effectively modifying the
required deductions from gross earnings to eliminate those deductions based on
operating revenues. The Commission order requires that any dividend paid out
of amounts that would otherwise be restricted must be limited to net income
earned in the 12 months immediately preceding payment of the dividend.
MODIFICATIONS OF INDENTURE. The Indenture may be amended, by
supplemental indenture without the consent of bondholders, for various
purposes specified therein, including the making of any change in the
Indenture effective only with respect to Bonds authenticated after the
execution of such supplemental indenture and only if such change would not
adversely affect Bonds then outstanding and the making of any other change not
inconsistent with the terms, and which would not impair the security, of the
Indenture. The Indenture also provides that with the consent of the holders
of not less than 66-2/3% in principal amount of Bonds then outstanding that
would be affected thereby, when authorized by a resolution of its Board of
Directors, the Indenture may be amended in any respect, except that without
the consent of the holder of each outstanding Bond affected thereby no such
amendment shall, among other things, (i) extend the time for, reduce or
otherwise affect the terms of any payment of the principal of or interest or
premium on any Bond, (ii) permit the creation of any lien ranking prior to or
on a parity with the lien of the Indenture, other than permitted encumbrances
and liens and prepaid liens, (iii) reduce the percentage in principal amount
of Bonds the consent of the holders of which is required for any such
amendment, (iv) impair the right of any bondholder to institute suit for the
enforcement of any payment in respect of his Bonds or (v) deprive any non-
assenting bondholders of a lien upon the mortgaged property for the security
of his Bonds.
DEFAULTS. The Indenture includes as events of default: any default in
payment of principal of any Bonds at maturity or otherwise; any default
continued for 60 days in payment of interest thereon; any default in payment
of principal or interest on prior lien bonds continued beyond any applicable
grace period; any adjudication of bankruptcy, appointment of receiver, filing
of petition in voluntary bankruptcy or admission of insolvency by or with
respect to the Company; and any default continued for 90 days after notice
from the Trustee in the performance of any covenant or condition in the
Indenture or with respect to any prior lien. The Company is required to give
periodic certificates as to the absence of a default and compliance with the
terms of the Indenture, and must also give certificates to such effect in
connection with the authentication of additional bonds or withdrawal of cash
under the Indenture. The Trustee is not required to take action with respect
to a default except upon written request of the holders of not less than 25%
in principal amount of outstanding Bonds under the Indenture and upon the
tender of security and indemnity satisfactory to the Trustee against all costs
and liabilities which might be incurred by reason of the taking of such
<PAGE> 14
action. The Indenture provides that the Trustee may withhold notice to
bondholders of any default (except in payment of the principal of or interest
on any Bonds or in the making of any sinking fund or similar payment) if it
considers such withholding to be in the interest of bondholders.
LEGAL OPINIONS
Legal opinions relating to the validity of the New Bonds will be given
by Milbank, Tweed, Hadley & McCloy, 1 Chase Manhattan Plaza, New York, New
York 10005, counsel for the Company, and Sidley & Austin, One First National
Plaza, Chicago, Illinois 60603, counsel for the Underwriters.
EXPERTS
The financial statements, and schedules 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
report dated February 13, 1995, with respect thereto, and are incorporated
herein by reference in reliance upon the authority of said firm as experts in
giving said reports.
PLAN OF DISTRIBUTION
The Company may sell the New Bonds offered hereby (i) through
competitive bidding; (ii) through negotiation with one or more underwriters;
(iii) through one or more agents designated from time to time; (iv) directly
to purchasers; or (v) any combination of the above. The distribution of the
New Bonds may be effected from time to time in one or more transactions at a
fixed price or prices which may be changed, at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at
negotiated prices. A Prospectus Supplement will describe the method of
distribution of the New Bonds of any series.
If an underwriter or underwriters are utilized in the sale, the Company
will execute an underwriting agreement with such underwriters at the time of
sale, and the names of the underwriters of the transaction will be set forth
in the Prospectus Supplement relating to such sale. The New Bonds will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of the
sale. Unless otherwise indicated in the Prospectus Supplement, the
underwriting or purchase agreement will provide that the underwriter or
underwriters are obligated to purchase all of the New Bonds offered in the
Prospectus Supplement if any are purchased.
If any of the New Bonds are sold through an agent or agents designated
by the Company from time to time, the Prospectus Supplement will name any such
agent, set forth any commissions payable by the Company to any such agent and
the obligations of such agent with respect to the New Bonds. Unless otherwise
indicated in the Prospectus Supplement, any such agent will be acting on a
best efforts basis for the period of its appointment.
<PAGE> 15
The New Bonds of any series, when first issued, will have no established
trading market. Any underwriters or agents to or through whom New Bonds are
sold by the Company for public offering and sale may make a market in such New
Bonds, 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 New Bonds.
In connection with the sale of the New Bonds, any purchasers,
underwriters or agents may receive compensation from the Company or from
purchasers in the form of concessions or commissions. The underwriters will
be, and any agents and any dealers participating in the distribution of the
New Bonds may be, deemed to be underwriters within the meaning of the
Securities Act of 1933, as amended. The agreement between the Company and any
purchasers, underwriters or agents will contain reciprocal covenants of
indemnity between the Company and the purchasers, underwriters, or agents
against certain liabilities, including liabilities under the Act, and will
provide for contribution by the Company in lieu of its indemnity obligations.
Certain of the underwriters or agents and their associates may engage in
transactions with, or perform services for, the Company and its affiliates in
the ordinary course of business.
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the issuance and distribution
of the securities being registered, other than underwriting compensation, are:
Filing fee for Registration Statement. . . . . . . . . . . . . $ 15,517*
Public Utility Holding Company Act filing fee . . . . . . . . 2,000*
Financial Printing . . . . . . . . . . . . . . . . . . . . . 25,000
Fees and expenses of Trustee . . . . . . . . . . . . . . . . . 35,000
Fees of rating agencies . . . . . . . . . . . . . . . . . . . 45,000
Fees of accountants . . . . . . . . . . . . . . . . . . . . . 15,000
Reimbursement of underwriters' expenses and
counsel fees in connection with qualification
or registration of the New Bonds under state
securities or "blue sky" laws . . . . . . . . . . . . . . . 5,000
Expenses of Central and South West Services, Inc.. . . . . . . 5,000
Counsel Fees:
Milbank, Tweed, Hadley & McCloy
New York, New York . . . . . . . . . . . . . . . . . . . 65,000
Wagstaff, Alvis, Stubbeman, Seamster &
Longacre, L.L.P.
Abilene, Texas. . . . . . . . . . . . . . . . . . . . . . 10,000
Miscellaneous and incidental expenses, including
travel, telephone, copying, postage . . . . . . . . . . . . 2,483
--------
Total . . . . . . . . . . . . . . . . . . . . . . . $225,000
========
_______________
* Actual Amount
Item 15. Indemnification of Directors and Officers.
Article 2.02 of the Texas Business Corporation Act provides broadly for
indemnification of directors and officers against claims and liabilities
against them in their capacities as such. The Company's bylaws also provide
for the indemnification of directors and officers by the Company. In
addition, the Company has purchased Directors' and Officers' Liability and
Company Reimbursement Liability Insurance which, in certain circumstances,
provide for payments to the directors and officers of the Company, in the
event of such liabilities.
<PAGE> 17
Item 16. Exhibits.
Exhibit No. Description of Exhibits
1 - Form of Underwriting Agreement.
4(a) - Indenture dated August 1, 1943, as amended through July 1,
1973 (incorporated herein by reference to Exhibit 5.05 in
Registration Statement No. 2-60712), the Supplemental
Indentures dated May 1, 1979, November 15, 1981, November 1,
1983, April 15, 1985, August 1, 1985, May 1, 1986, December
1, 1989, June 1, 1992, October 1, 1992, February 1, 1994 and
March 1, 1995 (incorporated herein by reference to Exhibit
2.02 in Registration Statement No. 2-63931, Exhibit 4.02 in
Registration Statement No. 2-74408, Exhibit 12 to Form U-1,
File No. 70-6820, Amended Exhibit 13 to Form U-1, File No.
70-6925, Exhibit 4(b) in Registration Statement No. 2-98843,
Exhibit 4 to Form U-1, File No. 70-7237, Amended Exhibit 3 to
Form U-1, File No. 70-7719, Exhibit 10 to Form U-1, File No.
70-7936, Exhibit 10 to Form U-1, File No. 70-8057, Exhibit 10
to Form U-1, File No. 70-8265 and Exhibit 10(b) to Form U-1,
File No. 70-8057, respectively).
4(b) - Form of Supplemental Indenture providing for the New Bonds
and setting forth the form thereof.
5 - Opinion of Milbank, Tweed, Hadley & McCloy, counsel for the
Company, as to the legality of the New Bonds.
12(a) - Statement re: computation of Ratio of Earnings to Fixed
Charges for the five years ended December 31, 1994
(incorporated herein by reference to Exhibit 12 to the
Company's 1994 Annual Report on Form 10-K).
12(b) - Statement re: computation of Ratio of Earnings to Fixed
Charges for the twelve months ended March 31, 1995
(incorporated herein by reference to Exhibit 12 to the
Company's Quarterly Report on Form 10-Q).
23(a) - Consent of Arthur Andersen LLP.
23(b) - Consent of Milbank, Tweed, Hadley & McCloy (contained in
Exhibit 5 above).
24 - Powers of Attorney (included on signature page of the
Registration Statement).
25(a) - Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Harris Trust and Savings Bank, as Trustee.
25(b) - Form T-2 Statement of Eligibility under the Trust Indenture
Act of 1939 of J. Bartolini as successor co-Trustee.
26 - Form of Invitation for Competitive Bids.
<PAGE> 18
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
this registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or
any material change to such information in this registration statement;
provided, however, that the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a post-
effective amendment by these 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 this registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered 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.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant'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 this registration statement shall be deemed to be
a new registration statement relating to the securities offered herein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
<PAGE> 19
(5) To use its best efforts to distribute prior to the opening of bids
to prospective bidders, underwriters and dealers, a reasonable number of
copies of a prospectus which at that time meets the requirements of Section
10(a) of the Securities Act of 1933, and relating to the securities offered at
competitive bidding, as contained in this registration statement, together
with any supplements thereto.
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 foregoing provisions, or otherwise, the
registrant has 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 the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE> 20
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Abilene, State of Texas, on June 28, 1995.
WEST TEXAS UTILITIES COMPANY
By /s/ DENNIS M. SHARKEY
-------------------------------
Dennis M. Sharkey
Vice President-Administration
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes and appoints
Stephen J. McDonnell and Stephen D. Wise or either of them, as his attorney-
in-fact, with full power of substitution and resubstitution to sign and file
on his behalf individually and in each such capacity stated below any and all
amendments and post-effective amendments to this Registration Statement and
any registration statement of the company relating to First Mortgage Bonds
filed after the date hereof pursuant to Rule 462(b) under the Securities Act
of 1933, as amended, as fully as such person could do in person, hereby
verifying and confirming all that said attorney-in-fact, or either of them, or
their or his substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on June 28, 1995.
SIGNATURE TITLE
--------- -----
/s/ GLENN FILES President and Chief Executive Officer
----------------------------- (principal executive officer); Director
Glenn Files
/s/ DENNIS M. SHARKEY Vice President-Administration [(principal
----------------------------- financial officer)]; Director
Dennis M. Sharkey
/s/ R. RUSSELL DAVIS Controller (principal accounting officer)
-----------------------------
R. Russell Davis
/s/ PAUL J. BROWER Vice President - Marketing and Business
----------------------------- Development; Director
Paul J. Brower
<PAGE> 21
SIGNATURE TITLE
--------- -----
/s/ DON WELCH Vice President - Operations and Engineering;
----------------------------- Director
Don Welch
/s/ T. D. CHURCHWELL
----------------------------- Executive Vice President; Director
T. D. Churchwell Director
/s/ RICHARD F. BACON
----------------------------- Director
Richard F. Bacon
/s/ C. HARWELL BARBER Director
-----------------------------
C. Harwell Barber
/s/ E. R. BROOKS Director
-----------------------------
E. R. Brooks
/s/ HARRY D. MATTISON Director
-----------------------------
Harry D. Mattison
/s/ TOMMY MORRIS Director
-----------------------------
Tommy Morris
/s/ DIAN G. OWEN Director
-----------------------------
Dian G. Owen
/s/ JAMES M. PARKER Director
-----------------------------
James M. Parker
/s/ F. L. STEPHENS Director
-----------------------------
F. L. Stephens
<PAGE> 1
INDEX TO EXHIBITS
EXHIBIT TRANSMISSION
NUMBER EXHIBIT METHOD
- ------- ------- ------------
1 Form of Underwriting Agreement. Electronic
4(a) Indenture dated August 1, 1943, as amended Incorporated
through July 1, 1973 (incorporated herein by Reference
by reference to Exhibit 5.05 in Registration
Statement No. 2-60712), the Supplemental
Indentures dated May 1, 1979, November 15,
1981, November 1, 1983, April 15, 1985,
August 1, 1985, May 1, 1986, December 1,
1989, June 1, 1992, October 1, 1992,
February 1, 1994 and March 1, 1995 (incorpo-
rated herein by reference to Exhibit 2.02
in Registration Statement No. 2-63931,
Exhibit 4.02 in Registration Statement No.
2-74408, Exhibit 12 to Form U-1, File No.
70-6820, Amended Exhibit 13 to Form U-1,
File No. 70-6925, Exhibit 4(b) in Registration
Statement No. 2-98843, Exhibit 4 to Form U-1,
File No. 70-7237, Amended Exhibit 3 to Form
U-1, File No. 70-7719, Exhibit 10 to Form U-1,
File No. 70-7936, Exhibit 10 to Form U-1, File
No. 70-8057, Exhibit 10 to Form U-1, File No.
70-8265 and Exhibit 10(b) to Form U-1, File No.
70-8057, respectively).
4(b) Form of Supplemental Indenture providing for Electronic
the New Bonds and setting forth the form
thereof.
5 Opinion of Milbank, Tweed, Hadley & McCloy, Electronic
counsel for the Company, as to the legality of
the New Bonds.
12(a) Statement re: computation of Ratio of Earnings Incorporated
to Fixed Charges for the five years ended by Reference
December 31, 1994 (incorporated herein by
reference to Exhibit 12 to the Company's 1994
Annual Report on Form 10-K).
12(b) Statement re: computation of Ratio of Earnings Incorporated
to Fixed Charges for the twelve months ended by Reference
March 31, 1995 (incorporated herein by reference
to Exhibit 12 to the Company's Quarterly Report
on Form 10-Q).
23(a) Consent of Arthur Andersen LLP Electronic
23(b) Consent of Milbank, Tweed, Hadley & McCloy ---
(contained in Exhibit 5 above).
24 Powers of Attorney (included on signature page ---
of the Registration Statement).
<PAGE> 2
INDEX TO EXHIBITS
EXHIBIT TRANSMISSION
NUMBER EXHIBIT METHOD
- ------- ------- ------------
25(a) Form T-1 Statement of Eligibility under the Electronic
Trust Indenture Act of 1939 of Harris Trust
and Savings Bank, as Trustee.
25(b) Form T-2 Statement of Eligibility under the Electronic
Trust Indenture Act of 1939 of J. Bartolini
as successor co-Trustee.
26 Form of Invitation for Competitive Bids. Electronic
<PAGE> 1
EXHIBIT 1
<PAGE> 2
WEST TEXAS UTILITIES COMPANY
FIRST MORTGAGE BONDS
UNDERWRITING AGREEMENT
_____________ __ , 199_
West Texas Utilities Company
301 Cypress
Abilene, Texas 79601
Dear Sirs:
We (the "Managers") understand that West Texas Utilities Company, a Texas
corporation (the "Company"), proposes to issue and sell $___,___,___ aggregate
principal amount of its First Mortgage Bonds, Series ___ (the "Offered
Securities"). Subject to the terms and conditions set forth herein or
incorporated by reference herein, the Company hereby agrees to sell and the
underwriter or underwriters named in Schedule I hereto (such underwriter or
underwriters being herein called the "Underwriters") agree to purchase,
severally and not jointly, the principal amounts of such Offered Securities
set forth opposite their names in Schedule I hereto at ___% of their principal
amount plus accrued interest, if any, from __________ __, 199_ to the date of
payment and delivery.
The Underwriters will pay for such Offered Securities at the offices of
Milbank, Tweed, Hadley & McCloy, 1 Chase Manhattan Plaza, New York, New York
10005 at 10:00 a.m., New York Time, on ___________ __, 199_ or at such other
place and time, not later than ___________ __, 199_, as shall be mutually
agreed. The Offered Securities shall be concurrently delivered to the
Underwriters at the offices of ______________________________.
The Offered Securities shall have the following terms:
Maturity: __________ __, ____
--------
Interest Rate: _____%
-------------
Mandatory and Optional
Sinking Fund Provisions: As described in the Prospectus and
----------------------- applicable Prospectus Supplement for
the Offered Securities
Optional Redemption Provisions: As described in the Prospectus and
------------------------------ applicable Prospectus Supplement for
the Offered Securities
Interest Payment Dates: __________ __ and __________ __,
---------------------- commencing ___________ __, 199_
<PAGE> 3
Address for Notices
to Managers under
Underwriting Agreement:
----------------------
Payment Method:
--------------
All the provisions contained in the document entitled West Texas
Utilities Company Underwriting Agreement Standard Provisions (Bonds-Shelf)
dated _______________ __, 199_, a copy of which you and we have previously
received, are herein incorporated by reference in their entirety and shall be
deemed to be a part of this Underwriting Agreement to the same extent as if
such provisions had been set forth in full herein. References herein and
therein to numbered sections of the Underwriting Agreement shall mean the
numbered sections of such Standard Provisions.
Please confirm your agreement by having an authorized officer sign a copy
of this Underwriting Agreement in the space set forth below and returning the
signed copy to us. This Underwriting Agreement may be signed in any number of
counterparts with the same effect as if the signature thereto and hereto were
upon the same instrument. It is understood that our acceptance of this
agreement on behalf of each of the Underwriters is or will be pursuant to the
authority set forth in a form of Agreement Among Underwriters, the form of
which shall be submitted to the Company for examination, upon request.
Very truly yours,
[LIST UNDERWRITERS]
By: [LEAD MANAGER]
By:______________________________
Title:___________________________
Accepted:
WEST TEXAS UTILITIES COMPANY
By:_______________________________
Title:____________________________
<PAGE> 4
Schedule I
----------
Principal
Amount of
Underwriters New Bonds
------------ ---------
-----------
Total $
===========
<PAGE> 5
WEST TEXAS UTILITIES COMPANY
UNDERWRITING AGREEMENT
STANDARD PROVISIONS (BONDS-SHELF)
Dated ___________ __, 199_
From time to time West Texas Utilities Company, a Texas corporation (the
"Company"), may enter into one or more underwriting agreements that provide
for the sale of designated securities to the several underwriters named
therein. The standard provisions set forth herein may be incorporated by
reference in any such underwriting agreement and any such underwriting
agreement, including the provisions incorporated therein by reference, is
herein referred to as the "Underwriting Agreement".
The Company proposes to issue the series of First Mortgage Bonds
specified in the Underwriting Agreement (the "Offered Securities") pursuant to
the provisions of its Indenture dated August 1, 1943, as supplemented and as
the same may from time to time be amended or supplemented (the "Indenture"),
to Harris Trust and Savings Bank and J. Bartolini, as Trustees. The Offered
Securities will have the terms and rights, including the maturity, rate and
times of payment of interest, selling price and redemption terms, as set forth
in the Underwriting Agreement and Prospectus (as hereinafter defined). The
Underwriting Agreement shall be in the form of an executed writing (which may
be in counterparts) and may be evidenced by an exchange of telegraphic
communications or any other rapid transmission device designed to produce a
written record of communications transmitted.
1. Representations and Warranties of the Company.
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 33- ),
including a prospectus, relating to the Offered Securities, and the offering
thereof from time to time in accordance with Rule 415 under the Securities Act
of 1933, as amended (the "Securities Act"), and such registration statement
has become effective. The Company has prepared or will promptly prepare for
filing with, or transmission for filing to, the Commission, pursuant to Rule
424 under the Securities Act, a Prospectus Supplement (the "Supplement") for
the purpose of supplying information in respect of the public offering of the
Offered Securities, the names of the underwriter or group of underwriters and
other matters. Said registration statement, as amended at the time it became
effective, including the information contained in the final prospectus filed
with the Commission pursuant to Rule 424(b) of the Securities Act, and the
prospectus, as supplemented by the Supplement, relating to the Offered
Securities in final form as filed with the Commission pursuant to Rule 424
under the Securities Act, are hereinafter called the "Registration Statement"
and the "Prospectus", respectively. The term "Basic Prospectus" means the
prospectus included in the Registration Statement. The term "preliminary
prospectus" means a preliminary prospectus supplement, if any, relating to the
Offered Securities together with the Basic Prospectus. Whenever the word
"Registration Statement", "registration statement", "Prospectus", "preliminary
prospectus" or "prospectus" is used herein it shall be deemed to include all
documents incorporated therein by reference pursuant to the requirements of
Form S-3 under the Securities Act (the "Incorporated Documents").
<PAGE> 6
[(b) The Company has filed with the Commission a Form U-1 Application-
Declaration with respect to the issue and sale of the Offered Securities and
has no reason to believe that the Commission will not enter an order under the
Public Utility Holding Company Act of 1935, as amended (the "Holding Company
Act"), permitting such Application-Declaration to become effective prior to
the purchase by the Underwriters of the Offered Securities pursuant to the
Underwriting Agreement. A copy of such order and any supplemental order
entered by the Commission under the Holding Company Act with respect to such
Application-Declaration will be delivered to the Underwriters on or prior to
the Closing Date.] [OR]
[(b) The Commission has entered an order under the Public Utility
Holding Company Act of 1935, as amended (the "Holding Company Act"),
permitting to become effective the Form U-1 Application-Declaration filed by
the Company with respect to the issue and sale of the Offered Securities,
[such order being subject, however, to the condition, among other conditions,
that the Company comply with such supplemental order, if any, as the
Commission may enter thereunder]. A copy of such order heretofore entered by
the Commission has been or will be delivered to the Underwriters.]
(c) Except as otherwise contemplated herein, no approval, authorization,
consent, certificate or order of any State commission or regulatory authority
is necessary with respect to the issuance or the sale of the Offered
Securities by the Company.
(d) The Basic Prospectus filed as a part of the registration statement
relating to the Offered Securities as originally filed, or as a part of any
amendment thereto, any preliminary prospectus at the time of its issuance, and
the Registration Statement and the Prospectus and any amendment or supplement
to the Registration Statement or the Prospectus as of their effective or issue
dates, and as of the Closing Date (as hereinafter defined), complied or will
comply, in each case in all material respects, with the provisions of the
Securities Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission under said
Acts, and neither the Registration Statement nor any amendment thereto
contains or will contain an untrue statement of a material fact or omits or
will omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading and the Basic
Prospectus, any preliminary prospectus, the Prospectus or any amendment or
supplement thereto does not include and will not include an untrue statement
of a material fact and does not omit and will not omit to state a material
fact required to be stated therein or necessary to make the statements therein
in light of the circumstances under which they were made not misleading;
provided that the foregoing representations and warranties in this subsection
(d) shall not apply to omissions from the Registration Statement or Prospectus
resulting from the failure of any of the Underwriters to furnish the Company
with the information pertaining to such Underwriters and the underwriting of
the Offered Securities required to complete the Registration Statement or the
Prospectus, to statements in the Form T-1 and Form T-2 filed by the Trustees
as exhibits to the Registration Statement or to statements in or omissions
from the Prospectus made in reliance upon and in conformity with information
furnished in writing to the Company by any of the Underwriters for use in
connection with the preparation of the Prospectus. The Incorporated Documents
that were filed under the Securities Exchange Act of 1934, as amended (the
<PAGE> 7
"Exchange Act"), complied at their respective times of filing, and any
documents deemed to be incorporated in the Registration Statement and
Prospectus at all times during which a prospectus is required to be delivered
under the Securities Act will comply at their respective times of filing, with
the provisions of the Exchange Act and the rules and regulations of the
Commission thereunder.
(e) Except as the Company may have furnished supplemental information to
each prospective Underwriter or to the Managers prior to the receipt of
proposals to purchase the Offered Securities as to matters to be reflected in
the Prospectus, since the respective dates as of which information is given in
the Registration Statement and in the Prospectus, there has been no (A)
material adverse change in the condition, financial or otherwise, or in the
earnings of the Company, or (B) adverse development concerning the Company's
business or assets which would result in a material adverse change in its
prospective financial condition or results of operations, except such changes
as are set forth or contemplated in such Registration Statement (including the
financial statements and notes thereto included or incorporated by reference
in the Registration Statement) or the Prospectus.
(f) The Indenture adequately describes all or substantially all the
permanent fixed properties now owned by the Company, except certain property
excepted from the lien of the Indenture and property of the character
expressly excluded from such lien by the terms of the Indenture, and except
any property constructed or acquired by the Company subsequent to the date of
execution of the Supplemental Indenture creating and providing for the
issuance of the Offered Securities.
(g) At or prior to the acceptance by the Company of a proposal for the
purchase of the Offered Securities, the Company will have taken all corporate
action necessary to be taken by it to authorize the acceptance of such
proposal and, at or before the Closing Date, will have taken all corporate
action necessary to be taken by it to authorize the performance by it of all
obligations on its part to be performed under the Underwriting Agreement; and
the consummation of the transactions contemplated in, and the fulfillment of
the terms of, the Underwriting Agreement will not result in a breach of any of
the terms and provisions of, or constitute a default under, any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company
is a party at the Closing Date, or the Restated Articles of Incorporation of
the Company, as amended, or any order, rule or regulation applicable to the
Company of any court or of any state or Federal regulatory body or
administrative agency having jurisdiction over the Company or over its
property.
(h) Arthur Andersen LLP are independent accountants with respect to the
Company as required by the Securities Act and the applicable rules and
regulations thereunder.
2. Purchase, Sale and Delivery of Offered Securities.
The Company is advised by the Managers that the Underwriters propose to
make a public offering of their respective portions of the Offered Securities
as soon after the Underwriting Agreement is entered into as in the Managers'
judgment is advisable. The terms of the public offering of the Offered
Securities are or will be set forth in the Prospectus.
<PAGE> 8
Payment for the Offered Securities shall be made by certified or official
bank check or checks payable to the Company or its order in immediately
available Federal funds (unless the Underwriting Agreement shall otherwise
specify) at the time and place set forth in the Underwriting Agreement upon
delivery to the Managers for the respective accounts of the several
Underwriters of the Offered Securities registered in such names and in such
denominations as the Managers shall request in writing not less than two full
business days prior to the date of delivery. The Company agrees to have the
Offered Securities available for inspection, checking and packaging by the
Managers at the location indicated in the Underwriting Agreement not later
than 1:00 P.M. on the business day next prior to the Closing Date. The time
and date of such payment and delivery with respect to the Offered Securities
are herein referred to as the "Closing Date".
3. Covenants of the Company.
The Company covenants and agrees with each of the Underwriters that:
(a) As soon as practicable after the acceptance of a proposal to
purchase the Offered Securities, the Company will file the Supplement with the
Commission pursuant to Rule 424(b) of the Securities Act. The Company will
not file at any time prior to the Closing Date any other amendment to the
Registration Statement or any supplement to the Prospectus, or any other
amended prospectus or any document that upon the filing thereof would become
an Incorporated Document of which Sidley & Austin ("Underwriters' Counsel")
shall not previously have been advised and furnished with a copy or to which
the Managers shall reasonably object in writing.
(b) The Company will advise the Managers immediately, and confirm such
advice promptly in writing, of the effectiveness of any amendment to the
Registration Statement.
(c) The Company will notify promptly each of the Underwriters in the
event of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or in the event of the institution
or notice of intended institution by the Commission of any action or
proceeding for that purpose. In the event the Commission shall enter a stop
order suspending the effectiveness of the Registration Statement, whether
before or after the Offered Securities have been delivered to the Managers or
the Underwriters and paid for as provided in the Underwriting Agreement, the
Company will make every reasonable effort to obtain, as promptly as possible,
the entry by the Commission of an order setting aside any such stop order or
otherwise reinstating the effectiveness of the Registration Statement.
(d) The Company will deliver to the Managers, on or before the Closing
Date, one signed copy of the registration statement as originally filed and of
each amendment thereto (in each case including all exhibits thereto, other
than exhibits incorporated by reference), and will also deliver to the
Managers, for distribution to the Underwriters, a sufficient number of
conformed copies of each of the foregoing (but without exhibits) so that one
copy of each may be distributed to each of the Underwriters. The Company will
also send to the Managers or to the Underwriters, without expense to them, as
soon as practicable after the date hereof, and thereafter from time to time
<PAGE> 9
during a period of nine months after such date, as many copies of any
preliminary prospectus and the Prospectus as the Managers may reasonably
request for the purposes contemplated by the Securities Act.
(e) The Company will use its best efforts, when and as requested by the
Managers, to furnish information and otherwise cooperate in qualifying or
registering the Offered Securities for offer and sale under the securities or
"blue sky" laws of such jurisdictions as the Managers may designate, but the
Company shall not thereby be obligated to qualify as a foreign corporation in,
or to execute or file any general consent to service of process under the laws
of, any jurisdiction. The Company will pay the Underwriters' Counsel all
reasonable fees (including counsel fees) and expenses incurred by them in
connection with such qualification or registration of the Offered Securities
for offer or sale, not exceeding, however, $5,000 in the aggregate.
(f) If the Underwriting Agreement shall be terminated pursuant to the
provisions of Section 4 or 6(a), the Company will pay the reasonable fees and
disbursements of Underwriters' Counsel in connection with the contemplated
issue and sale of the Offered Securities, unless such termination is caused by
any default by the Managers or any of the Underwriters in the performance of
their respective obligations hereunder. Except as provided in this subsection
(f), the Underwriters shall pay the fees of Underwriters' Counsel and
reimburse such counsel for their reasonable expenses paid or incurred in
connection with the issue and sale of the Offered Securities. The Company
shall not in any event be liable to any of the Underwriters for damages on
account of loss of anticipated profits.
(g) The Company will, so long as any of the Offered Securities shall be
outstanding, deliver to the Managers upon their request, and to each other
Underwriter who may so request, copies of all public reports and all reports
and financial statements furnished by the Company to the Commission pursuant
to the Exchange Act or any rule or regulation of the Commission thereunder.
(h) During a period of nine months after the date of the Prospectus if
any event relating to or affecting the Company or its subsidiaries, if any, or
of which the Company shall be advised in writing by the Managers, shall occur
as a result of which it is necessary, in the opinion of counsel for the
Company, to supplement or amend the Prospectus in order to make the Prospectus
not misleading in the light of the circumstances existing at the time it is
delivered to a purchaser of Offered Securities from any of the Underwriters,
the Company will forthwith at its expense prepare and furnish to the Managers
or to the Underwriters a reasonable number of copies of a supplement or
supplements or an amendment or amendments to the Prospectus (in form
satisfactory to Underwriters' Counsel) which will supplement or amend the
Prospectus so that, as so supplemented or amended, it will not include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances existing at the time the Prospectus
is delivered to such a purchaser, not misleading. In case any of the
Underwriters is required to deliver a prospectus descriptive of the Offered
Securities after the expiration of nine months after the date of the
Prospectus, the Company, upon the request of the Managers, will furnish to the
Managers, at the expense of such Underwriter, a reasonable quantity of
<PAGE> 10
amendments or supplements to the Prospectus complying with Section 10 of the
Securities Act. For the purpose of this subsection (h), the Company will
furnish such information with respect to itself and its subsidiaries, if any,
as the Managers may from time to time reasonably request, and during said
nine-month period, the Company will prepare and continue to file with the
Commission all documents required to be filed under the Exchange Act.
(i) The Company will make generally available to its security holders,
as soon as practicable, an earnings statement (which need not be audited)
covering a period of at least twelve months beginning not earlier than the
date of the Prospectus, which earnings statement shall satisfy the
requirements of Section 11(a) of the Securities Act.
4. Conditions of Underwriters' Obligations.
The obligations of the Underwriters to purchase and pay for the Offered
Securities shall be subject to the performance by the Company of its
obligations to be performed under the Underwriting Agreement at or prior to
the Closing Date, to the continued accuracy in all material respects of the
representations and warranties of the Company contained in the Underwriting
Agreement, and to the following conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing and
in accordance with Section 1(a) of this Agreement; no stop order suspending
the effectiveness of the Registration Statement shall have been issued under
the Securities Act, or proceedings therefor instituted or threatened by the
Commission, on or prior to the Closing Date.
(b) At or prior to the Closing Date the Underwriters shall have received
from Underwriters' Counsel an opinion (subject to the reservation that they
have relied upon the opinion of Wagstaff, Alvis, Stubbeman, Seamster &
Longacre, L.L.P., Abilene, Texas, counsel for the Company, as to all matters
governed by Texas law), to the effect that:
(i) the Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Texas;
(ii) the Indenture has been duly and validly authorized by the
necessary corporate action by the Company, has been duly and validly
executed and delivered by the Company, and is a valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, subject, as to enforcement, (i) to the fact that certain
of the remedial provisions of the Indenture may be limited or rendered
unenforceable by the laws of the States wherein the mortgaged property is
situated (but said laws do not, in the opinion of such counsel, make the
remedies afforded by the Indenture inadequate for the realization of the
benefits of the security provided thereby), and (ii) to bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to
or affecting the enforcement of creditors' rights generally; to the
effects of the provisions of the Bankruptcy Reform Act of 1978, as
amended, on the validity of the lien of the Indenture with respect to the
property acquired or proceeds realized by the Company after the
<PAGE> 11
commencement of bankruptcy proceedings with respect to the Company; and
to the effects of general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law);
(iii) the issue and sale of the Offered Securities by the Company
in accordance with the terms of the Underwriting Agreement have been duly
and validly authorized by the Company. The Offered Securities, when duly
executed, authenticated and delivered to and paid for by the Managers or
the Underwriters, in accordance with the terms of the Underwriting
Agreement, will be valid and binding obligations of the Company, secured
by the lien of and entitled to the benefits of the Indenture, subject, as
to enforcement, (i) to the fact that certain of the remedial provisions
of the Indenture may be limited or rendered unenforceable by the laws of
the States wherein the mortgaged property is situated (but said laws do
not, in the opinion of such counsel, make the remedies afforded by the
Indenture inadequate for the realization of the benefits of the security
provided thereby), and (ii) to bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the enforcement
of creditors' rights generally; to the effects of the provisions of the
Bankruptcy Reform Act of 1978, as amended, on the validity of the lien of
the Indenture with respect to the property acquired or proceeds realized
by the Company after the commencement of bankruptcy proceedings with
respect to the Company; and to the effects of general principles of
equity (regardless of whether enforceability is considered in a
proceeding in equity or at law);
(iv) the Offered Securities and the Indenture conform as to legal
matters, in all material respects, with the statements concerning them
made in the Prospectus under the caption "Description of the New Bonds,"
and in the Prospectus Supplement under the caption "Supplemental
Description of the New Bonds," and such statements accurately set forth,
in all material respects, the matters respecting the Offered Securities
and the Indenture which are required to be set forth in the Prospectus,
as supplemented by the Prospectus Supplement, by the Securities Act and
the Trust Indenture Act and the rules and regulations under said Acts
(other than the accounting provisions thereof, with respect to the
requirements of which such counsel need express no opinion or belief);
and the Indenture has been qualified under the Trust Indenture Act;
(v) the order of the Commission referred to in subsection (b) of
Section 1 of the Underwriting Agreement has been duly entered and, to the
knowledge of said counsel, is in full force and effect. Except for an
order of the Commission entered into with respect to the Registration
Statement as contemplated in paragraph (vi) below, no further approval,
authorization, consent, certificate or order of any Federal commission or
regulatory authority is necessary with respect to the execution and
delivery of the Indenture or the issue and sale of the Offered Securities
by the Company as contemplated in the Underwriting Agreement;
(vi) the Registration Statement on Form S-3 has become effective
under the Securities Act, and, to the knowledge of said counsel, no stop
order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for such purpose have been instituted or are
pending or threatened under the Securities Act;
<PAGE> 12
(vii) the Registration Statement, the Prospectus and the Prospectus
Supplement, in each case excluding the Incorporated Documents (other than
financial statements, financial data, statistical data and supporting
schedules included or incorporated by reference therein, as to which said
counsel need express no opinion or belief), as of their respective
effective or issue dates, complied as to form, in all material respects,
with the requirements of the Securities Act (or, where appropriate, the
Exchange Act) and the rules and regulations of the Commission thereunder;
and
(viii) the Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
Such counsel shall also state that while, except as otherwise required or
stated in said opinion, said counsel have not independently checked the
accuracy or completeness of, or otherwise verified, and accordingly, are not
passing upon, and do not assume any responsibility for and have not
independently verified the accuracy, completeness or fairness of the
statements contained in the Registration Statement, the Prospectus or the
Prospectus Supplement, and relying as to materiality, to a large extent, upon
the judgment of officers and representatives of the Company, nothing has come
to the attention of said counsel which would lead said counsel to believe that
the Registration Statement relating to the Offered Securities or any amendment
thereto (other than financial statements, financial data, statistical data and
supporting schedules included or incorporated by reference therein, as to
which said counsel need express no opinion or belief), at the time it became
effective, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that (with the foregoing exception) the
Prospectus, as supplemented by the Prospectus Supplement, as of the date of
such opinion, includes any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(c) At or prior to the Closing Date, the Underwriters shall have
received from Milbank, Tweed, Hadley & McCloy, counsel for the Company, an
opinion (subject to the same reservation as that expressed in subsection (b)
of this Section 4), in form and substance satisfactory to Underwriters'
Counsel, to the same effect, in general, with respect to all matters
enumerated in subsection (b) of this Section 4.
(d) At or prior to the Closing Date, the Underwriters shall have
received from Wagstaff, Alvis, Stubbeman, Seamster & Longacre, L.L.P.,
Abilene, Texas, counsel for the Company, an opinion, in form and substance
satisfactory to Underwriters' Counsel, to the effect that:
(i) the Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Texas;
(ii) the issue and sale of the Offered Securities by the Company in
accordance with the terms of the Underwriting Agreement have been duly
and validly authorized by the necessary corporate action; the Offered
Securities, when duly executed, authenticated and delivered to the
<PAGE> 13
Underwriters against payment to the Company of the agreed consideration
therefor, will be valid and binding obligations of the Company, secured
by the lien of and entitled to the benefits of the Indenture;
(iii) the Company is a public utility duly authorized by its
Restated Articles of Incorporation, as amended, to conduct the business
of generating and supplying electric light and power to the public and
conducts such business only in the State of Texas and the Company has the
legal right to function and operate as a public utility in the State of
Texas, supplying therein electric service;
(iv) the Company has good and sufficient title to all or
substantially all the permanent fixed electric utility properties now
owned by it, including those described or referred to in the Prospectus
and the Prospectus Supplement, except as otherwise indicated therein,
subject only to the lien of the Indenture and to permitted encumbrances
and liens and prepaid liens (as defined in the Indenture); the Indenture,
subject only to permitted encumbrances and liens and prepaid liens,
constitutes a valid, direct first mortgage lien upon all such fixed
properties of the Company (with the exception of the properties expressly
excepted or excluded from such lien); all permanent fixed property
hereafter acquired by the Company and situated in the State of Texas
(other than property of the character of that expressly excepted or
excluded from the lien of the Indenture), will, upon such acquisition,
become subject to the lien of the Indenture, subject, however, to such
permitted encumbrances and liens and prepaid liens, any liens existing or
placed on such property at the time of the acquisition thereof by the
Company, and any liens thereon which might intervene prior to the filing
for record of the instrument by which title to such property is acquired
by the Company and except as provisions of the Bankruptcy Code may affect
the validity of the lien of the Indenture with respect to property
acquired, and proceeds, products, rents, issue or profits of the property
subject to such lien realized, after commencement of a case under such
Code; and the Indenture has been duly and validly authorized by the
necessary corporate action by the Company, has been duly and validly
executed and delivered by the Company and is a valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, except as set forth in the preceding clause, and subject
as to enforcement to bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting the enforcement of
creditors rights generally and to the effects of general principles of
equity (regardless of whether enforceability is considered in a
proceeding in equity or at law) and except as enforcement of provisions
thereof may be limited by the laws of the State of Texas affecting the
remedies for the enforcement of the security provided for in the
Indenture (which state laws do not, in the opinion of such counsel, make
such remedies inadequate for the realization of the benefits of such
security);
(v) the Indenture has been duly recorded as a utility security
instrument in the office of the Secretary of the State of Texas and
notices of utility security instrument affecting real property have
heretofore been duly filed in each of the counties in the State of Texas
in which property owned by the Company and subject to the lien of the
Indenture is situated, in such manner as to make effective the lien
<PAGE> 14
intended to be created by the Indenture; and such recordation and filings
constitute all of the action required under the laws of the State of
Texas to give notice of the lien of the Indenture;
(vi) the Company has valid and subsisting franchises, licenses and
permits authorizing it to carry on its electric utility business in all
municipalities served by it where required, with such minor exceptions
(if any) as may be indicated in such opinion;
(vii) no approval, authorization, consent, certificate or order of
any commission or regulatory authority of the State of Texas (other than
in connection or in compliance with the securities or "blue sky" laws or
regulations of the State of Texas) is necessary with respect to the
execution and delivery of the Indenture or the issuance and sale of the
Offered Securities by the Company to the Underwriters as contemplated by
the Underwriting Agreement;
(viii) except as set forth in the Prospectus or the Prospectus
Supplement, there is no material litigation or other legal proceeding
pending to which the Company is a party or of which property of the
Company is the subject, and, to the best of the knowledge of said
counsel, no such litigation or proceedings are contemplated; there may be
excepted various routine litigation, claims and other proceedings, which
are common or incident to the business in which the Company is engaged
but which, in the aggregate, are not significant (in the opinion of said
counsel) from the standpoint of the total assets and overall operations
of the Company;
(ix) the sale by the Company of the Offered Securities has been
duly authorized by the necessary corporate action; the Underwriting
Agreement has been duly authorized, executed and delivered by the
Company; and
(x) the statements made in the Prospectus and the Prospectus
Supplement, if any, which are stated therein to have been made on the
authority of such counsel have been reviewed by such counsel and, as to
matters of law or legal conclusions, are correct.
(e) At or prior to the Closing Date, the Underwriters shall have
received from Arthur Andersen LLP a letter confirming that they are
independent public accountants with respect to the Company within the meaning
of the Securities Act and the applicable published rules and regulations
thereunder and that the answer to Item 10 of the Registration Statement is
correct insofar as it relates to them and stating in effect (1) that in their
opinion the financial statements and schedules of the Company incorporated by
reference in the Registration Statement and Prospectus and which are stated
therein to have been certified or audited by them, comply as to form, in all
material respects, with the applicable accounting requirements of the
Securities Act and the published rules and regulations thereunder; (2) that
nothing has come to their attention which causes them to believe (A) that any
unaudited dollar amounts or ratios which may appear in the Registration
Statement and the Prospectus under the caption "The Company" were not
determined on a basis substantially consistent with that of the corresponding
amounts in the audited financial statements incorporated by reference in the
<PAGE> 15
Registration Statement and the Prospectus; (B) that any unaudited condensed
financial statements of the Company included in any of the Company's Form 10-Q
Quarterly Reports, which may be incorporated by reference in the Registration
Statement and the Prospectus, do not comply as to form in all material
respects with the applicable accounting requirements of the Exchange Act and
the applicable published rules and regulations thereunder, or that material
modifications should be made to such unaudited financial statements for them
to be in conformity with generally accepted accounting principles; or (C)
that, except in all instances as set forth or contemplated in the Registration
Statement or the Prospectus, (i) at the date of the latest available unaudited
financial statements of the Company read by them and at a subsequent date, not
more than five business days before the Closing Date, there has been any
change in the capital stock or long-term debt of the Company, as compared with
amounts shown in the latest balance sheet of the Company included or
incorporated by reference in the Registration Statement and the Prospectus,
except for normally scheduled reductions in the Company's long-term debt,
(ii) for the period from the date of the latest financial statements included
or incorporated by reference in the Prospectus to the date of the latest
available interim financial statements read by them and to the aforementioned
date not more than five business days prior to the Closing Date there was any
decrease, as compared with the corresponding period in the preceding twelve
month period, in the Company's operating revenues, operating income or net
income, (iii) there was any decrease in the ratio of earnings to fixed charges
for the twelve months ended the date of such latest available interim
financial statements as compared to such ratio for the twelve months ended the
date of the latest financial statements included or incorporated by reference
in the Prospectus, except as set forth in such letter, in which latter case
the letter shall be accompanied by an explanation by the Company as to the
significance thereof unless such explanation is not deemed necessary by the
Managers; and (3) that they have compared certain dollar amounts designated by
the Company and disclosed in the Registration Statement and Prospectus with
such dollar amounts contained in the general accounting records of the Company
or derived directly from such records by analysis or computation, and have
found such dollar amounts to be in agreement therewith, except as otherwise
specified in such letter, in which latter case the letter shall be accompanied
by an explanation by the Company as to the significance thereof unless such
explanation is not deemed necessary by the Managers.
The form of letter shall reflect the inclusion of any subsequently dated
financial information, the incorporation by reference of any subsequently
filed Annual Report on Form 10-K or Quarterly Report on Form 10-Q and/or the
inclusion in the Prospectus of any statistical or financial information.
Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, there shall not have been any
change or decrease specified in the letter required by this subsection (e)
which is, in the judgment of the Managers, so material and adverse as to make
it impractical or inadvisable to proceed with the offering or the delivery of
the Offered Securities as contemplated by the Registration Statement and the
Prospectus.
(f) At the Closing Date the Managers shall have received a certificate,
dated as of the Closing Date, signed by the President or a Vice President and
the Treasurer or the Secretary of the Company, to the effect that (i) to the
<PAGE> 16
best of the knowledge of the signers, no stop order suspending the
effectiveness of the Registration Statement has been issued under the
Securities Act and no proceedings therefor have been instituted or threatened
by the Commission, (ii) the order of the Commission referred to in subsection
(b) of Section 1 of the Underwriting Agreement is, to the best of the
knowledge of the signers, in full force and effect, and (iii) since the
respective dates as of which information is given in the Registration
Statement or Prospectus, there has been no (A) material adverse change in the
condition, financial or otherwise, or in the earnings of the Company or (B)
adverse development concerning the Company's business or assets which would
result in a material adverse change in its prospective financial condition or
results of operations, except such changes as are set forth or contemplated in
the Registration Statement or the Prospectus (including financial statements
and notes thereto contained in the Incorporated Documents).
(g) All proceedings to be taken in connection with the issuance and sale
of the Offered Securities by the Company as contemplated in the Underwriting
Agreement shall be satisfactory in form and substance to Underwriters'
Counsel.
In case any of the conditions specified in this Section 4 shall not have
been fulfilled, the Underwriting Agreement may be terminated by the Managers
with the consent of Underwriters who have agreed to purchase in the aggregate
more than fifty percent of the total principal amount of the Offered
Securities upon delivering written notice thereof to the Company. Any such
termination shall be without liability of any party to any other party except
as otherwise provided in subsection (f) of Section 3 of the Underwriting
Agreement.
5. Indemnification
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters and each person, if any, who controls any of the Underwriters
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages or
liabilities, joint or several, to which such Underwriter or such controlling
person may become subject under the Securities Act, the Exchange Act or the
common law or otherwise, and to reimburse each such Underwriter or such
controlling person for any reasonable legal or other expenses (including, to
the extent hereinafter provided, reasonable counsel fees) incurred by it or
them in connection with defending against any such losses, claims, damages or
liabilities, arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in (1) the Registration
Statement, the Basic Prospectus, any preliminary prospectus, or the Prospectus
or any amendment to the Registration Statement or amendment or supplement to
the Prospectus, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or (2) the Prospectus or the Prospectus as
amended or supplemented, if such losses, claims, damages or liabilities arise
out of or are based upon the use of the Prospectus or the Prospectus as
amended or supplemented after the Company shall have amended or supplemented
the Prospectus, or any omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided,
<PAGE> 17
however, that the indemnity agreement contained in this subsection (a) shall
not apply to any such losses, claims, damages or liabilities arising out of or
based upon (i) any such untrue statement or alleged untrue statement, or any
such omission or alleged omission, if such statement or omission was made in
reliance upon and in conformity with information furnished in writing to the
Company by any of the Underwriters for use in the Registration Statement or
the Prospectus or any amendment or supplement to either thereof, (ii) any
statement made in the Form T-1 or Form T-2 filed by the Trustees as exhibits
to the Registration Statement or (iii) the failure of any Underwriter to
deliver (either directly or through the Managers) a copy of the Prospectus
(excluding the Incorporated Documents), or of the Prospectus as amended or
supplemented after it shall have been amended or supplemented by the Company
(excluding the Incorporated Documents), to any person to whom a copy of any
preliminary prospectus shall have been delivered by or on behalf of such
Underwriter to whom any Offered Securities shall have been sold by such
Underwriter, as such delivery may be required by the Securities Act and the
rules and regulations of the Commission thereunder.
(b) Each of the Underwriters agrees to indemnify and hold harmless the
Company, each of its officers who signs the Registration Statement, each of
its directors, each person who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, each other
Underwriter and each person, if any, who so controls any such other
Underwriter, from and against any and all losses, claims, damages or
liabilities, joint or several, to which any one or more of them may become
subject under the Securities Act, the Exchange Act or the common law or
otherwise, and to reimburse each of them for any reasonable legal or other
expenses (including, to the extent hereinafter provided, reasonable counsel
fees) incurred by them in connection with defending against any such losses,
claims, damages or liabilities of the character above specified arising out of
or based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus or any
amendment to the Registration Statement or amendment or supplement to the
Prospectus or upon any omission or alleged omission to state in any thereof a
material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission was made in
reliance upon and in conformity with information furnished in writing to the
Company by such Underwriter for use in the Registration Statement or the
Prospectus or any amendment or supplement to either thereof, or (ii) the
failure of such Underwriter to deliver (either directly or through the
Managers) a copy of the Prospectus (excluding the Incorporated Documents), or
of the Prospectus as amended or supplemented after it shall have been amended
or supplemented by the Company (excluding the Incorporated Documents), to any
person to whom a copy of any preliminary prospectus shall have been delivered
by or on behalf of such Underwriter and to whom any Offered Securities shall
have been sold by such Underwriter, as such delivery may be required by the
Securities Act and the rules and regulations of the Commission thereunder.
(c) Promptly after receipt by a party indemnified under this Section 5
(an "indemnified party") of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against a
party granting an indemnity under this Section 5 (the "indemnifying party"),
notify the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
<PAGE> 18
liability which it may have to any indemnified party otherwise than under this
Section 5. In case any such action is brought against any indemnified party,
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the extent
that it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof (thereby conceding that the action in question is
subject to indemnification by the indemnifying party hereunder), with counsel
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert and conduct such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel, the indemnifying
party will not be liable to such indemnified party under this Section 5 for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified party shall
have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the next preceding sentence (it
being understood, however, that the indemnifying party shall not be liable for
the expenses of more than one separate counsel, approved by the Managers in
the case of subsection (a), representing the indemnified parties under
subsection (a) who are parties to such action), (ii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(d) If the indemnification provided for in this Section 5 shall be
unenforceable under applicable law by an indemnified party, the Company agrees
to contribute to such indemnified party with respect to any and all losses,
claims, damages and liabilities for which such indemnification provided for in
this Section 5 shall be unenforceable, in such proportion as shall be
appropriate to reflect the relative fault of the Company on the one hand and
the indemnified party on the other in connection with the statements or
omissions which have resulted in such losses, claims, damages and liabilities,
as well as any other relevant equitable considerations; provided, however,
that no indemnified party guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from the Company if the Company is not guilty of such fraudulent
misrepresentation. Relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the indemnified party and each such
party's relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Company and each of
<PAGE> 19
the Underwriters agree that it would not be just and equitable if contribution
pursuant to this subparagraph were to be determined solely by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above.
(e) The indemnity and contribution agreements contained in this Section
5 and the representations and warranties of the Company in the Underwriting
Agreement shall remain operative and in full force regardless of (i) any
termination of the Underwriting Agreement, (ii) any investigation made by or
on behalf of any Underwriter or any person controlling any Underwriter or by
or on behalf of the Company, its directors or officers or any person
controlling the Company and (iii) delivery of and payment for any of the
Offered Securities.
6. Termination.
(a) If the Offered Securities are being purchased for the purpose of
resale, the Underwriting Agreement may be terminated, at any time prior to the
Closing Date, by the Managers with the consent of Underwriters who have agreed
to purchase in the aggregate more than fifty percent of the total principal
amount of the Offered Securities, if (a) there shall have occurred any general
suspension or material limitation on trading in securities on the New York
Stock Exchange or by the Commission or by any federal or state agency or by
the decision of any court any limitation on prices for such trading or any
restrictions on the distribution of securities, (b) trading in any securities
of the Company shall have been suspended by the Commission or a national
securities exchange, (c) a general banking moratorium on commercial banking
activities in New York shall have been declared either by federal or New York
State authorities, (d) the rating assigned by any nationally recognized
securities rating agency to any securities of the Company as of the date of
the Underwriting Agreement shall have been lowered since that date, or (e)
there shall have occurred any outbreak or material escalation of hostilities
or other calamity or crisis, the effect of which on the financial markets of
the United States is such as to make it, in the judgment of the Managers,
impracticable to market the Offered Securities.
(b) Any termination of the Underwriting Agreement pursuant to this
Section 6 shall be without liability of any party to any other party except as
otherwise provided in subsection (f) of Section 3.
7. Default by an Underwriter.
If any one or more Underwriters shall fail to purchase and pay for any of
the Offered Securities agreed to be purchased by such Underwriter or
Underwriters hereunder and such failure to purchase shall constitute a default
in the performance of its or their obligations under the Underwriting
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Offered
Securities set forth opposite their names in Schedule I to the Underwriting
Agreement bears to the aggregate amount of Offered Securities set forth
opposite the names of all the remaining Underwriters) the Offered Securities
which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Offered Securities which the defaulting Underwriter or Underwriters agreed but
<PAGE> 20
failed to purchase (less such aggregate amount of Offered Securities as are
purchased by substituted underwriters selected by the Managers with the
approval of the Company or selected by the Company with the approval of the
Managers) shall exceed 10% of the aggregate amount of Offered Securities set
forth in such Schedule I, the remaining Underwriters shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the
Offered Securities, and if such nondefaulting Underwriters do not purchase all
the Offered Securities, the Underwriting Agreement will terminate without
liability to any nondefaulting Underwriter or the Company (except as otherwise
provided in subsection (f) of Section 3). In the event of a default by an
Underwriter as set forth in this Section 7, the Closing Date shall be
postponed for such period, not exceeding seven calendar days, as the Company
and the Managers shall determine in order that the required changes in the
Registration Statement and the Prospectus or in any other documents or
arrangements may be effected. Nothing contained in the Underwriting Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Company and any nondefaulting Underwriter for damages occasioned by its
default thereunder.
8. Notices.
All communications under the Underwriting Agreement will be effective
only on receipt, and, if sent to the Managers, will be mailed, delivered or
telegraphed and confirmed to them, at the address, or telephoned to them at
the number, specified in the Underwriting Agreement and to Sidley & Austin,
One First National Plaza, Chicago, Illinois 60603, attention: Wilbur C. Delp,
Jr.; or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it in care of Central and South West Corporation, 1616 Woodall
Rodgers Freeway, P.O. Box 660164, Dallas, Texas 75202, attention of Stephen D.
Wise, in each case with written confirmation of such communication sent to
Milbank, Tweed, Hadley & McCloy, 1 Chase Manhattan Plaza, New York, New York
10005, attention Robert B. Williams, Esq.
9. Successors.
The Underwriting Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 5 of the Underwriting
Agreement, and no other person will have any right or obligation hereunder and
no other person (including a purchaser, as a purchaser, from any Underwriter
of any of the Offered Securities) shall acquire or have any rights under or by
virtue of the Underwriting Agreement.
10. Governing Law.
The Underwriting Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
<PAGE> 1
EXHIBIT 4(b)
<PAGE> 2
__________________________________________________________________________
SUPPLEMENTAL INDENTURE
DATED ________ __, 19__
____________________
WEST TEXAS UTILITIES COMPANY
TO
HARRIS TRUST AND SAVINGS BANK
AND
J. BARTOLINI
as Trustees
____________________
(SUPPLEMENTAL TO THE INDENTURE DATED AUGUST 1, 1943,
EXECUTED BY WEST TEXAS UTILITIES COMPANY
TO HARRIS TRUST AND SAVINGS BANK
AND HAROLD ECKHART, AS TRUSTEES)
____________________
PROVIDING FOR
FIRST MORTGAGE BONDS, SERIES __, ______% DUE ___________ __, ____
__________________________________________________________________________
THIS INSTRUMENT GRANTS A SECURITY INTEREST BY
A UTILITY AND CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS
<PAGE> 3
THIS SUPPLEMENTAL INDENTURE, dated _________ __, 199_, made and entered into
by and between WEST TEXAS UTILITIES COMPANY, a corporation organized and
existing under the laws of the State of Texas (herein commonly referred
to as the "Company"), and HARRIS TRUST AND SAVINGS BANK, a corporation
organized and existing under the laws of the State of Illinois and
having its principal office or place of business in the City of Chicago,
State of Illinois, (hereinafter sometimes referred to as the "Trustee"),
and J. BARTOLINI, of the City of Chicago, State of Illinois (successor
co-Trustee to J. L. SPRENG, resigned), as Trustees under the Indenture
dated August 1, 1943, as amended by the Supplemental Indentures dated,
respectively, March 1, 1948, November 1, 1951, April 1, 1955, January 1,
1958, February 1, 1961, January 1, 1969, July 1, 1973, May 1, 1979,
November 15, 1981, November 1, 1983, April 15, 1985, August 1, 1985,
May 1, 1986, December 1, 1989, June 1, 1992, October 1, 1992, February
1, 1994 and March 1, 1995, heretofore executed and delivered by the
Company to the Trustees under said Indenture dated August 1, 1943; said
Indenture, as so amended, being hereinafter sometimes referred to as the
"Indenture"; and said Harris Trust and Savings Bank and J. Bartolini
being hereinafter sometimes referred to as the "Trustees" or the
"Trustees under the Indenture";
WITNESSETH:
WHEREAS, the Company, by resolution duly adopted by its Board of
Directors, has determined forthwith to issue an additional series of bonds to
be secured by the Indenture, as hereby modified, and to be known and
designated as First Mortgage Bonds, Series _ (hereinafter sometimes referred
to as the "bonds of Series _" or the "bonds of said series") and has duly
authorized the execution and delivery of this supplemental indenture for the
purposes hereinafter set forth; and the Company has requested, and hereby
requests, the Trustees to enter into and join with the Company in the
execution and delivery of this supplemental indenture; and
WHEREAS, on or subsequent to the date of the last Supplemental
Indenture, the Company has constructed or acquired certain additional
properties which are subject in any event to the lien and effect of the
Indenture; and
WHEREAS, the Company desires, in accordance with the provisions of
Article I, Section 6(e) of Article II and Article XVI of the Indenture, to
execute this supplemental indenture for the purpose of (i) specifically
conveying to the Trustees, upon the trusts and for the purposes of the
Indenture, as hereby amended, all such additional properties so constructed or
acquired by the Company and now owned by it, except property of the character
of that expressly excepted and excluded from the lien of the Indenture, (ii)
creating the bonds of Series _, and (iii) modifying or amending the Indenture
in the particulars and to the extent hereinafter in this supplemental
indenture specifically provided; and
<PAGE> 4
WHEREAS, each of the bonds of Series _ is to be substantially in the
following form:
(Form of face of bond of Series __)
No. $
WEST TEXAS UTILITIES COMPANY
First Mortgage Bond, Series ____
_____% Due _______________, _______
West Texas Utilities Company, a Texas corporation (hereinafter referred
to as the "Company"), for value received, hereby promises to pay to
________________ or registered assigns, the principal sum of $____________
Dollars on the _____ day of __________ __, ____, and to pay to the registered
owner interest on said sum from the date hereof at the rate of ______ per
centum per annum, payable half-yearly on the first day of _______ and the
first day of ________ in each year, commencing __________ __, 199_, until said
principal sum is paid. Both the principal of and the interest on this bond
shall be payable at the principal office or agency of the Company in the City
of New York, State of New York, in any coin or currency of the United States
of America which at the time of payment is legal tender for public and private
debts provided that, at the option of the Company, payment of interest may be
made by check mailed to the address of the person entitled thereto as shown on
the registration books of the Trustee.
_________________________
The provisions of this bond are continued on the reverse side hereof and
such continued provisions shall for all purposes have the same effect as
though fully set forth at this place.
_________________________
This bond shall not be valid or become obligatory for any purpose unless
and until it shall have been duly authenticated by the execution by or on
behalf of the Trustee or its successor in trust under the Indenture of the
Trustee's Certificate in the form endorsed hereon.
IN WITNESS WHEREOF, West Texas Utilities Company has caused this bond to
be executed in its name by the manual or facsimile signature of its President
or one of its Vice-Presidents, and its corporate seal or a facsimile thereof
to be affixed hereto or imprinted hereon and attested by the manual or
facsimile signature of its Secretary or one of its Assistant Secretaries.
Dated as of
WEST TEXAS UTILITIES COMPANY
By________________________________
President
ATTEST:
____________________________
Secretary
<PAGE> 5
(Form of reverse side of bond of Series __)
This bond is one of the bonds issued and to be issued from time to time
under and in accordance with and all secured by the indenture dated August 1,
1943, executed and delivered by the Company to Harris Trust and Savings Bank
(hereinafter referred to as the "Trustee") and Harold Eckhart, as Trustees,
and by the indentures supplemental thereto dated, respectively, March 1, 1948,
November 1, 1951, April 1, 1955, January 1, 1958, February 1, 1961, January 1,
1969, July 1, 1973, May 1, 1979, November 15, 1981, November 1, 1983, April
15, 1985, August 1, 1985, May 1, 1986, December 1, 1989, June 1, 1992,
October 1, 1992, February 1, 1994 and March 31, 1995, executed and delivered
by the Company to the Trustees under said indenture dated August 1, 1943, and
by a further indenture supplemental thereto dated _______________ __, ______,
executed and delivered by the Company to Harris Trust and Savings Bank and J.
Bartolini (successor Co-Trustee), as Trustees, prior to the authentication of
this bond (said indenture and said supplemental indentures being hereinafter
referred to as the "Indenture"). Reference to the Indenture and to all
supplemental indentures, if any, hereafter executed pursuant to the Indenture
is hereby made for a description of the property mortgaged and pledged, the
nature and extent of the security and the rights of the holders and registered
owners of said bonds and of the Trustees and of the Company in respect of such
security. By the terms of the Indenture the bonds to be secured thereby are
issuable in series, which may vary as to date, amount, date of maturity, rate
of interest, redemption provisions, medium of payment and in other respects as
in the Indenture provided.
At the option of the Company and upon the notice and in the manner and
with the effect provided in the Indenture, bonds of Series ____, of which this
is one, may be redeemed (a) as a whole at any time, or in part from time to
time, at the redemption price, expressed as a percentage of the principal
amount of the bonds, hereinafter stated under "General Redemption Price," in
effect at the date fixed for redemption, together with accrued interest to
such date on the bonds to be redeemed, and (b) in part from time to time on or
after _______________ ___, _____, (i) for the purpose of complying with the
requirement of subdivision (a) of Section __ of Article VII of the Indenture
in respect of the debt retirement period in which such redemption is effected,
or (ii) out of any moneys deposited with and held from time to time by the
Trustee pursuant to the provisions of subdivision (c) of said Section __ of
Article VII, in each case at the redemption price, expressed as a percentage
of the principal amount of the bonds, hereinafter stated under "Debt
Retirement Redemption Price", in effect at the date fixed for redemption,
together with accrued interest to such date on the bonds to be redeemed:
<PAGE> 6
If Redeemed If Redeemed
During the Debt During the Debt
12 Months General Retirement 12 Months General Retirement
Beginning Redemption Redemption Beginning Redemption Redemption
________ 1, Price* Price* ________ 1, Price* Price*
- ----------- ---------- ---------- ----------- ---------- ----------
___________________
* (The redemption prices and redemption periods set forth in Article I of
this supplemental indenture are incorporated in and made a part of this
form of bond by reference thereto, and shall be inserted at this point in
each bond of said series.)
provided, that none of the bonds of Series __ may be redeemed prior to
_________ __, ____, except for the purpose of complying with the requirements
of Section __ of Article VII aforesaid, if such redemption is for the purpose
of refunding or is in anticipation of the refunding of such bonds through the
use, directly or indirectly, of funds borrowed by the Company at an interest
cost to the Company less than the interest cost to it in respect of the bonds
of Series __, which is __% per annum; and provided further, that the Company
shall not redeem in any calendar year, at any applicable Debt Retirement
Redemption Price, bonds of Series __ in a principal amount greater than (i) 1%
of the greatest principal amount of the bonds of Series _ issued and
outstanding under, and determined as provided in, the Indenture at any time
between the end of such calendar year and ________ __, ____, multiplied by the
number of full 12-month periods elapsed between the end of such calendar year
and ________ __, ____, less (ii) the principal amount of such bonds previously
redeemed at any Debt Retirement Redemption Price.
In case of certain events of default specified in the Indenture, the
principal of this bond may be declared or may become due and payable in the
manner and with the effect provided in the Indenture. No recourse shall be
had for the payment of the principal of or interest on this bond, or for any
claim based hereon, or otherwise in respect hereof or of the Indenture or any
indenture supplemental thereto, to or against any incorporator, stockholder,
officer or director, past, present or future, of the Company, or of any
predecessor or successor corporation, either directly or through the Company,
or such predecessor or successor corporation, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers being waived and released by the registered owner hereof by the
acceptance of this bond and being likewise waived and released by the terms of
the Indenture. This bond is transferable by the registered owner hereof, in
person or by attorney duly authorized, at the principal office or place of
business of the Trustee under the Indenture, upon the surrender and
cancellation of this bond and the payment of any stamp tax or other
governmental charge, and upon any such transfer a new registered bond or bonds
of the same series and maturity date and for the same aggregate principal
amount will be issued to the transferee in exchange herefor; provided, that
<PAGE> 7
the Company (a) shall not register, exchange or transfer any bonds of said
series during the period of ten days next preceding any interest payment date
of bonds of said series and (b) shall not be required to register, exchange or
transfer any bonds of said series during the period beginning at the opening
of business ten days next preceding any date for selection of bonds of said
series to be called for redemption and ending at the close of business on the
day of the giving of the relevant notice of redemption as provided in the
Indenture, and, as to bonds of said series selected for redemption, from and
after the date of such selection.
This bond shall be deemed to be governed by and construed in accordance
with the laws of the State of New York.
AND WHEREAS, on each of the bonds of Series __ (whether in temporary or
definitive form) there is to be endorsed a certificate of the Trustee
substantially in the following form:
Trustee's Certificate
This bond is one of the bonds of the series designated therein, described
in the within-mentioned Indenture.
HARRIS TRUST AND SAVINGS BANK,
as Trustee,
By_______________________________
Authorized Signature
NOW, THEREFORE, in consideration of the premises and of the sum of One
Dollar ($1.00) duly paid by the Trustees to the Company, and of other good and
valuable consideration, the receipt whereof is hereby acknowledged, and for
the purpose of further assuring to the Trustees under the Indenture their
title to, or lien upon, the property hereinafter described, under and pursuant
to the terms of the Indenture, as hereby amended, and for the purpose of
further securing the due and punctual payment of the principal of and interest
and the premium, if any, on all bonds which have been heretofore or shall be
hereafter issued under the Indenture and indentures supplemental thereto and
which shall be at any time outstanding thereunder and secured thereby, and for
the purpose of securing the faithful performance and observance of all the
covenants and conditions set forth in the Indenture and/or in any indenture
supplemental thereto, the Company has given, granted, bargained, sold,
transferred, assigned, pledged, mortgaged, warranted the title to and
conveyed, and by these presents does give, grant, bargain, sell, transfer,
assign, pledge, mortgage, warrant the title to and convey unto HARRIS TRUST
AND SAVINGS BANK and J. BARTOLINI, as Trustees under the Indenture as therein
provided, and their successors in the trusts thereby created, and to their
assigns, all the right, title and interest of the Company in and to any and
all premises, plants, property, leases and leaseholds, franchises, permits,
rights and powers of every kind and description, real and personal, (1) which
have been constructed or acquired by the Company on or subsequent to
__________, 199__, and which at the date hereof are owned by the Company, and
<PAGE> 8
(2) which shall on or after the date hereof be acquired by the Company through
construction, purchase, grant, consolidation, merger or otherwise, together
with the rents, issues, products and profits therefrom, excepting, however,
and there is hereby expressly reserved and excluded from the lien and effect
of the Indenture and of this supplemental indenture, all right, title and
interest of the Company, now owned or hereafter acquired, in and to (a) all
cash, bonds, shares of stock, obligations and other securities not deposited
with the Trustee or Trustees under the Indenture, and (b) all accounts and
bills receivable, judgments (other than for the recovery of real property or
establishing a lien or charge thereon or right therein) and choses in action
not specifically assigned to and pledged with the Trustee or Trustees under
the Indenture, and (c) all tangible personal property held by the Company for
sale, lease, rental or consumption in the ordinary course of business, and (d)
the last day of each of the demised terms created by any lease of property now
leased to the Company, and under each and every renewal of any such lease, the
last day of each and every such demised term being hereby expressly reserved
to and by the Company, and (e) all gas, oil and other minerals existing upon,
within or under any real estate subject to the lien of the Indenture, as
hereby modified, and (f) the real estate specifically excepted and excluded by
the Indenture from the lien and operation thereof.
Without in any way limiting or restricting the generality of the
foregoing description or the foregoing exceptions and reservations, the
Company hereby expressly gives, grants, bargains, sells, transfers, assigns,
pledges, mortgages, warrants the title to and conveys unto the Trustees
subject to all reservations, exceptions, easements, restrictions, conditions
and covenants of record, the properties of the Company described in Appendix A
to this supplemental indenture (said Appendix A being incorporated by
reference herein with the same force and effect as if set forth in full
herein), together with the tenements, hereditaments and appurtenances
thereunto belonging or appertaining:
TO HAVE AND TO HOLD all said property, rights, and interests hereinabove
described and conveyed, assigned, pledged or mortgaged, or intended to be
conveyed, assigned, pledged or mortgaged, together with the rents, issues,
products and profits therefrom, unto HARRIS TRUST AND SAVINGS BANK and J.
BARTOLINI, as Trustees under the Indenture, as hereby amended, and unto their
successor or successors in trust, and their assigns forever, BUT IN TRUST,
NEVERTHELESS, upon the trusts, for the purposes and subject to all the terms,
conditions, provisions and restrictions of the Indenture, as hereby amended.
And upon the considerations and for the purposes aforesaid, and in order,
pursuant to terms of the Indenture, to provide for the issuance under the
Indenture, as hereby amended, of bonds of Series __ and to fix the terms,
provisions and characteristics of the bonds of said Series, and in order to
modify or amend the Indenture in the particulars and to the extent hereinafter
in this supplemental indenture specifically provided, the Company hereby
covenants and agrees with the Trustees as follows:
<PAGE> 9
ARTICLE I
A series of bonds issuable under the Indenture, as hereby amended, and to
be known and designated as "First Mortgage Bonds, Series __", is hereby
created and authorized. The bonds of Series __ shall be substantially in the
form thereof hereinbefore recited. Each bond of said Series shall be dated as
of the date of the interest payment day thereof to which interest was paid
next preceding the date of issue, unless (a) issued on an interest payment day
thereof to which interest was paid, in which event it shall be dated as of the
date of issue, or (b) issued prior to the occurrence of the first interest
payment day thereof to which interest was paid, in which event it shall be
dated _________ __, 199__; shall be due and payable ________ __, ____; shall
bear interest from the date thereof at the rate of _____ per centum per annum,
payable half-yearly on the first day of ________ and the first day of ________
in each year, and shall be payable, both as to principal and interest, at the
office or agency of the Company in the City of New York, State of New York, in
any coin or currency of the United States of America which at the time of
payment is legal tender for public and private debts, provided that, at the
option of the Company, payment of interest may be made by check mailed to the
address of the person entitled thereto as shown on the registration books of
the Trustee.
At the option of the Company and upon the notice and in the manner and
with the effect provided in the Indenture, except as to notice as hereinafter
provided, the bonds of Series ___ shall be redeemable (a) as a whole at any
time, or in part from time to time, at the redemption price, expressed as a
percentage of the principal amount of the bonds hereinafter stated under
"General Redemption Price", in effect at the date fixed for redemption,
together with accrued interest to such date on the bonds to be redeemed, and
(b) in part from time to time on or after _________ __, 199__, (i) for the
purpose of complying with the requirement of subdivision (a) of Section __ of
Article VII of the Indenture (as hereby amended) in respect of the debt
retirement period in which such redemption is effected, or (ii) out of any
moneys deposited with and held from time to time by the Trustee pursuant to
the provisions of subdivision (c) of said Section __ of Article VII, in each
case at the redemption price, expressed as a percentage of the principal
amount of the bonds, hereinafter stated under "Debt Retirement Redemption
Price", in effect at the date fixed for redemption, together with accrued
interest to such date on the bonds to be redeemed:
If Redeemed If Redeemed
During the Debt During the Debt
12 Months General Retirement 12 Months General Retirement
Beginning Redemption Redemption Beginning Redemption Redemption
________ 1, Price* Price* ________ 1, Price* Price*
- ----------- ---------- ---------- ----------- ---------- ----------
% % % %
100 100
_______________
* Stated as a percentage of principal amount of the Bonds.
<PAGE> 10
provided, that none of the bonds of Series __ may be redeemed prior to
________ __, 199_, except for the purpose of complying with the requirements
of Section __ of Article VII aforesaid, if such redemption is for the purpose
of refunding or is in anticipation of refunding of such bonds through the use,
directly or indirectly, of funds borrowed by the Company at an interest cost
to the Company less than the interest cost to the Company in respect of the
bonds of Series __ , which is ____% per annum; and provided further, that the
Company shall not redeem in any calendar year, at an applicable Debt
Retirement Redemption Price, bonds of Series ___ in a principal amount greater
than (i) 1% of the greatest principal amount of the bonds of Series ___ issued
and outstanding under, and determined as provided in, the Indenture at any
time between the end of such calendar year and _________ __, ____, multiplied
by the number of full 12-month periods elapsed between the end of such
calendar year and _________ __, ____, less (ii) the principal amount of such
bonds previously redeemed at any Debt Retirement Redemption Price.
The foregoing redemption prices and terms shall be set forth in each of
the bonds of Series __ prior to the execution and authentication thereof.
Notice of redemption of any bonds of Series __ need be given only by mail
and not by publication. Such notice, whether given by mail or by publication,
need be given only once (instead of four times) not less than thirty (30) days
or more than forty-five (45) days prior to the redemption date. If given only
by mail, the mailing of such notice shall be a condition precedent to
redemption, provided that any notice which is mailed in the manner provided in
said Article shall be conclusively presumed to have been duly given whether or
not the holders received such notice, and failure to give notice by mail, or
any defect in such notice, to the holder of any such bond designated for
redemption in whole or in part shall not affect the validity of the redemption
of any other such bond. In all other respects, notice of redemption shall be
given as provided in Article V of the Indenture.
The bonds of Series __ shall, from time to time, be executed on behalf of
the Company and sealed with the corporate seal of the Company, which seal may
be facsimile, all in the manner provided in Section 6 of Article I of the
Indenture as follows: (a) bonds of said Series executed on behalf of the
Company by its President, a Vice-President, its Secretary or an Assistant
Secretary may be so executed by the facsimile signature of such President,
Vice-President, Secretary or Assistant Secretary, as the case may be, of the
Company or of any person or persons who shall have been such officer or
officers, as the case may be, of the Company on or subsequent to the date of
this supplemental indenture, notwithstanding that he or they may have ceased
to be such officer or officers of the Company at the time of the actual
execution, authentication, issue or delivery of any of such bonds of said
Series, and any such facsimile signature or signatures of any such officer or
officers on any such bonds shall constitute execution of such bonds on behalf
of the Company by such officer or officers of the Company for the purposes of
the Indenture (as hereby amended) and shall be valid and effective for all
purposes, provided that all bonds of said Series shall always be executed on
behalf of the Company by the signature, manual or facsimile, of its President
or Vice President and of its Secretary or an Assistant Secretary, and (b) such
corporate seal of the Company may be facsimile, and any bonds of Series __ on
<PAGE> 11
which such facsimile seal shall be affixed, impressed, imprinted or reproduced
shall be deemed to be sealed with the corporate seal of the Company for the
purposes of the Indenture (as hereby amended) and such facsimile seal shall be
valid and effective for all purposes.
Bonds of Series __ are exchangeable and transferable in the manner and
upon the conditions prescribed in the Indenture (as hereby amended) and
without charge therefor, except for any stamp tax or other governmental
charge; provided, that the Company (a) shall not register, exchange or
transfer bonds of said Series during the period of ten days next preceding any
interest payment date of bonds of said Series and (b) shall not be required to
register, exchange or transfer any bonds of said Series during the period
beginning at the opening of business ten days next preceding any date for
selection of bonds of said Series to be called for redemption and ending at
the close of business on the day of the giving of the relevant notice of
redemption as provided in the Indenture (as hereby amended), and, as to bonds
of said Series selected for redemption, from and after the date of such
selection.
ARTICLE II
Section 1. Section 10 of Article III of the Indenture is hereby amended
by striking out the words "Series A through Series __, inclusive", wherever
the same occur in said section, and by inserting, in lieu thereof, the words
"Series A through Series __, inclusive."
Section 2. Section 1 of Article VII of the Indenture is hereby amended
by striking out the words "Series E through __, inclusive" and by inserting,
in lieu thereof, the words "Series E through __, inclusive".
Section 3. Article VII of the Indenture is hereby amended and expanded
by adding thereto a new section to be known as Section __ of said Article VII
and to read as follows:
"Section __. The Company covenants and agrees, subject to the terms
of this section, that, in addition to the expenditures required to be
made under Sections 1, 2 and 4 through __, inclusive, of this Article
VII, it will
(a) retire, through purchase, payment or redemption, during the
period of twelve consecutive calendar months ending on the last day of
________ in each of the years ____ to ____, inclusive (each such 12-month
period being herein sometimes called a "debt retirement period" or as
"the period" or "such period"), so long as the bonds of Series __
(hereinafter in this section sometimes referred to as the "bonds of said
Series"), shall be outstanding under this Indenture, a principal amount
of bonds of said Series equal to one per centum (1%) of the greatest
principal amount of bonds of said Series issued and outstanding under
this Indenture at any time between the end of such period and _________
__, ____; or
<PAGE> 12
(b) in lieu of the retirement of all or any portion of the principal
amount of bonds of said Series required by the provisions of subdivision
(a) hereof to be retired during any such period, make net expenditures
for bondable property (as those terms are defined in Section 3 of Article
II of this Indenture) upon which this Indenture is a first lien, subject
only to permitted encumbrances and liens and prepaid liens (as those
terms are defined in said Section 3), in an amount equal to $1,666.67 for
each $1,000 in principal amount of bonds of said Series in lieu of the
retirement of which such net expenditures are made; or
(c) pay to the Trustee in cash on or before the first day of
________ next succeeding the end of each such period a sum sufficient to
redeem (at the debt retirement redemption price then prevailing) the
principal amount of bonds of said Series required by the provisions of
subdivision (a) hereof to be retired which the Company shall have failed
to retire during such period or in lieu of the retirement of which the
Company shall not have made net expenditures for bondable property as
provided in subdivision (b) hereof.
"If in any such debt retirement period the total of the principal amount
of bonds of said Series retired through purchase, payment or redemption,
and/or the amount of net expenditures made for such bondable property, shall
be in excess of the amount by this section required for such period, the
Company shall be entitled to be credited to the extent of such excess on
account of the requirements of this section in any subsequent period or
periods; provided, however, that (i) no retirement of bonds or net
expenditures for bondable property which shall have been made the basis for
the authentication of bonds or the release of property or the withdrawal of
deposited cash or any other moneys, under any provisions of this Indenture, or
which shall have been made out of any insurance moneys or moneys received from
the condemnation, sale or other disposition of any of the Company's property
subject to the lien of this Indenture, or which shall have been previously
used or applied or certified to the Trustee to comply with any requirement of
this Article VII or with any other provision of this Indenture, and (ii) no
retirement of bonds which shall have been made with moneys applied to such
purpose pursuant to any provision of this Article VII or of Section 4 of
Article II or of Article IX of this Indenture shall be certified or be applied
for the purpose of complying with this section or for the purpose of
withdrawing any moneys paid to the Trustee pursuant to this section. Subject
to the foregoing provisions of this paragraph, any such retirement of bonds of
said Series or net expenditures for such bondable property made prior to
_________ __, ____, but subsequent to July 31, 1943, may be certified to
comply with the requirements of this section for the 12-month period ending on
_________ __, ____, or for any period or periods subsequent thereto.
"In determining, for the purposes of this section, the principal amount
of bonds of said Series outstanding under this Indenture at any time, there
shall be excluded the principal amount of such bonds then owned by the Company
and the principal amount of bonds for the retirement of which the necessary
moneys shall be on deposit with the Trustee or any paying agent for bonds of
said Series; and 'the greatest principal amount of bonds of said Series
<PAGE> 13
outstanding under this Indenture at any time' during any period shall mean the
greatest principal amount of such bonds outstanding, as shown by the Trustee's
records, at the close of business on any day in such period after making the
foregoing exclusions.
"On or before the first day of April in each year beginning with the year
1995, so long as any bonds of said Series shall be outstanding, the Company
shall deliver to the Trustee a certificate, signed in the name of the Company
by its President or a Vice-President and by its Treasurer or an Assistant
Treasurer, (1) showing in reasonable detail (i) the greatest principal amount
of bonds of said Series outstanding under this Indenture at any time between
the end of the preceding debt retirement period ended December 31 and
_________ __, ____, (ii) the principal amount of bonds of said Series retired,
through purchase, payment or redemption, during such period and/or the amount
of net expenditures for such bondable property made during such period, which
the Company desires to have applied to the requirements of this section for
such period, and (iii) such excess amounts, if any, of bonds of said Series so
retired and/or net expenditures for such bondable property made, in any
preceding period or periods, which the Company desires to have applied to the
requirements of this section for the period next preceding the date of such
certificate, and (2) stating that none of such bonds of said Series and none
of such expenditures for such bondable property desired by the Company to be
applied to the requirements of this section for such next preceding period has
been made the basis for the authentication of bonds or the release of property
or the withdrawal of deposited cash or any other moneys, under any provision
of this Indenture, or has been retired or made out of any insurance moneys or
moneys received from the condemnation, sale or other disposition of any of the
Company's property subject to the lien of this Indenture or has been
previously used or applied or certified to the Trustee to comply with any
requirement of this Article VII or with any other provision of this Indenture,
and that none of such retirements of bonds has been made with moneys applied
to such purpose pursuant to any provision of this Article VII or of Section 4
of Article II or of Article IX of this Indenture. If the retirement of bonds
of said Series and the net expenditures for such bondable property recited in
such certificate for the purpose of complying with this section are
insufficient to meet the requirements of this section for such next preceding
period and the Company shall not be entitled, on account of excess retirements
of bonds of said Series or net expenditures for such bondable property made in
any preceding period or periods, to take credit for such next preceding period
in the amount of the deficiency, the Company shall pay in cash to the Trustee,
concurrently with the delivery of such certificate, the amount of any such
deficiency which may be required to comply with subdivision (c) of this
section.
"At the option of the Company any moneys paid to the Trustee to comply
with the provisions of subdivision (c) of this section shall, upon the written
request of the Company signed in its name by its President or a Vice-
President, (1) be applied by the Trustee to the purchase in the open market of
bonds of said Series, at not exceeding the general redemption price at which
bonds of said Series may then be redeemed, or to the redemption of bonds of
said Series at the debt retirement redemption price at which bonds of said
Series may then be redeemed, or (2) be paid by the Trustee to or upon the
order of the Company to the extent of (i) the principal amount of bonds of
<PAGE> 14
said Series purchased or paid by the Company and delivered to the Trustee,
cancelled or for cancellation, and (ii) the accrued interest and the premium,
if any, theretofore paid to the Trustee, as hereinabove provided, on such
principal amount of bonds. The requisite showing of facts entitling the
Company to have paid to it any moneys under the provisions of this section
shall be made by a certificate signed by the President or a Vice-President of
the Company and by its Treasurer or an Assistant Treasurer and delivered to
the Trustee. The Company hereby covenants and agrees that it will pay to the
Trustee from time to time in cash such additional sums, if any, as shall be
paid or required to be paid by the Trustee for accrued interest and premium,
if any, in respect of any bonds of said Series purchased or redeemed pursuant
to the provisions of this section.
"No retirement of bonds or net expenditures for such bondable property
certified or applied to comply with the requirements of this section or made
out of moneys deposited with the Trustee under the provisions of this section
or used as a basis for the withdrawal of any such moneys shall be certified to
comply with any provision of this Article VII or be available as a basis for
the authentication of bonds or the withdrawal of deposited cash or any other
moneys or the release of property under, or to comply with, any other
provision of this Indenture.
"Any and all bonds of said Series, the retirement of which (through
payment or purchase) shall be certified to the Trustee in compliance with the
provisions of this section shall be delivered to the Trustee at or before the
time the same shall be so certified and shall thereupon be cancelled and
destroyed by the Trustee by cremation or by shredding, compacting and
solidifying or other equivalent means, unless theretofore so cancelled and
destroyed. All other bonds of said Series received by the Trustee pursuant to
any provision of this section shall thereupon be cancelled and destroyed by
the Trustee."
ARTICLE III
The Company covenants that, so long as any of the bonds of Series __ are
outstanding, it will not declare any dividends on its common stock (except (i)
dividends payable in shares of its common stock, and (ii) dividends payable in
cash where concurrently with the payment thereof an amount in cash at least
equal to the amount of the cash dividends paid is received by the Company as a
capital contribution or as the proceeds of the issue and sale of shares of its
common stock), or make any other distributions on shares of its common stock,
or purchase or otherwise acquire for value any shares of its common stock
(except in exchange for, or out of the proceeds from the sale of, other shares
of its common stock), if after giving effect thereto, the aggregate amount of
all such dividends, distributions, purchases or acquisitions (other than those
excepted above) paid or made subsequent to _________ __, 199_, would exceed
the sum of:
(a) the earned surplus of the Company earned after _________
__, 199_, determined as hereinafter provided;
(b) the earned surplus of the Company at _________ __, 199_;
and
<PAGE> 15
(c) such additional amount as may be authorized or approved,
upon application of the Company, by the Securities and Exchange
Commission, or any successor commission thereto, under the Public
Utility Holding Company Act of 1935, as amended.
The earned surplus of the Company earned after _________ __, 199_, shall
be determined, for the purposes of this Article, in accordance with generally
accepted principles of accounting, but after deduction of all dividends paid
or accrued after _________ __, 199_, on preferred stock of the Company, and
before giving effect to charges to earned surplus in connection with dividends
and distributions on and purchases and acquisitions of common stock of the
Company, net transfers from earned surplus to stated capital accounts, and
charges or credits to earned surplus in respect of matters inherent in the
Company's accounts at _________ __, 199_, including charges for the purpose of
writing off or writing down the book value of assets owned by the Company on
that date.
In determining earned surplus earned for any period after _________ __,
199_, for the purpose of this Article, the amounts to be so deducted as
charges or provisions for depreciation, retirement, renewals and replacements
and/or amortization, shall be not less in the aggregate than an amount equal
to the required percentage (as defined in Section 1 of Article VII of the
Indenture, as amended by the indentures supplemental thereto dated January 1,
1958 and May 1, 1979) of the arithmetical average of the amounts of
depreciable property (as defined in said Section 1 of Article VII) of the
Company at the beginning, and the amount thereof at the end, of such period.
ARTICLE IV
SECTION 1. The provisions of this supplemental indenture shall be
effective from and after the date of execution hereof; and the Indenture, as
hereby amended, shall remain in full force and effect.
SECTION 2. Each reference in the Indenture, or this supplemental
indenture, to any article, section, term or provision of the Indenture shall
mean and be deemed to refer to such article, section, term or provision of the
Indenture, as modified by this supplemental indenture, except where the
context otherwise indicates.
SECTION 3. All the covenants, provisions, stipulations and agreements in
this supplemental indenture contained are and shall be for the sole and
exclusive benefit of the parties hereto, their successors and assigns, and of
the holders and registered owners from time to time of the bonds and of the
coupons issued and outstanding from time to time under and secured by the
Indenture, as hereby amended by this supplemental indenture.
This supplemental indenture may be simultaneously executed in any number
of counterparts and all said counterparts executed and delivered, each as an
original, shall constitute but one and the same instrument.
<PAGE> 16
At the time of the execution of this supplemental indenture, the
aggregate principal amount of all indebtedness of the Company outstanding, or
to be presently outstanding, under and secured by the Indenture, as hereby
amended, is $235,203,000, consisting of and represented by First Mortgage
Bonds of the Company as follows:
Interest Principal
Series Rate Maturity Date Amount
O 9-1/4 December 1, 2019 55,203,000
P 7-3/4 June 1, 2007 25,000,000
Q 6-7/8 October 1, 2002 35,000,000
R 7 October 1, 2004 40,000,000
S 6-1/8 February 1, 2004 40,000,000
T 7-1/2 March 1, 2000 40,000,000
*
__________________
* To be issued by the Company under the Indenture subsequent to the date of
execution of this supplemental indenture.
SECTION 4. This Supplemental Indenture and the bonds of Series __ shall
be governed by and construed in accordance with the laws of the State of New
York.
<PAGE> 17
IN WITNESS WHEREOF, said West Texas Utilities Company has caused this
instrument to be executed in its corporate name by its President or a Vice
President and its corporate seal to be hereunto affixed and to be attested by
its Secretary or an Assistant Secretary, and said Harris Trust and Savings
Bank, for the purpose of entering into and joining with the Company in the
execution and delivery of this supplemental indenture, has caused this
instrument to be executed in its corporate name by its President or a Vice
President and its corporate seal to be hereunto affixed and to be attested by
its Secretary or an Assistant Secretary, and said J. Bartolini, for the
purpose of entering into and joining with the Company in the execution and
delivery of this supplemental indenture, has signed and sealed this
instrument, in several counterparts; all as of the day and year first above
written.
WEST TEXAS UTILITIES COMPANY
By_____________________________
President
(CORPORATE SEAL)
ATTEST:
_______________________________
Secretary
HARRIS TRUST AND SAVINGS BANK
As Trustee
By________________________________
Vice President
(CORPORATE SEAL)
ATTEST:
_______________________________
Assistant Secretary
By_______________________________(Seal)
As Co-Trustee
Executed by each of the above-named
parties hereto in the presence of:
_______________________________
_______________________________
Witnesses
<PAGE> 18
STATE OF ILLINOIS )
ss.
COUNTY OF COOK )
Before me, this undersigned, a Notary Public in and for Cook County in
the State of Illinois, on this day personally appeared ______________________,
Vice President of Harris Trust and Savings Bank, and Illinois corporation,
known to me to be such officer, and J. Bartolini, both known to me to be the
persons whose names are subscribed to the foregoing instrument, and each of
them acknowledged to me severally that he executed and signed the same for the
purposes and consideration therein expressed; and said _______________________
acknowledged to me that he executed and signed said instrument in the capacity
therein stated and on behalf, and as the act and deed, of said corporation,
for the purposes and consideration therein expressed and pursuant to the
appropriate by-law provisions of said corporation.
Given under my hand and seal of office this, the _____ day of _________,
A.D. 199_.
(NOTARIAL SEAL)
_____________________________________
Notary Public
Cook County, Illinois
My Commission expires ________________.
<PAGE> 19
STATE OF TEXAS )
ss.
COUNTY OF TAYLOR )
Before me, the undersigned, a Notary Public in and for Taylor County in
the State of Texas, on this day personally appeared _____________________,
________________ of West Texas Utilities Company, a Texas corporation, known
to me to be such officer, and the person whose name is subscribed to the
foregoing instrument, and he acknowledged to me severally that he executed and
signed the same for the purposes and consideration therein expressed; and said
_____________________ acknowledged to me that he executed and signed said
instrument in the capacity therein stated and on behalf, and as the act and
deed, of said corporation, for the purposes and consideration therein
expressed and pursuant to the authority of appropriate resolution of the Board
of Directors of said corporation.
Given under my hand and seal of office this ____ day of ______________,
A.D. 199_.
(NOTARIAL SEAL)
_____________________________________
Notary Public
State of Texas
My Commission expires ________________.
<PAGE> 20
STATE OF TEXAS )
ss.
COUNTY OF TAYLOR )
The undersigned, being duly sworn, deposes and says that he is the
President of West Texas Utilities Company, a Texas corporation, which executed
the foregoing instrument, and that said instrument was executed by a utility,
as defined in Section 35.01 of Subchapter A, Chapter 35, of The Business and
Commerce Code of the State of Texas, engaged in the generation, transmission,
distribution and sale of electric power in the State of Texas.
________________________________
President of
West Texas Utilities Company
Subscribed and sworn to before me, this ____ day of _________________,
A.D. 199_.
(NOTARIAL SEAL)
_____________________________________
Notary Public
State of Texas
My Commission expires ________________.
<PAGE> 1
EXHIBIT 5
<PAGE> 2
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
June 30, 1995
West Texas Utilities Company
301 Cypress
Abilene, Texas 79601
Re: West Texas Utilities Company
$45,000,000 First Mortgage Bonds
Ladies and Gentlemen:
We are acting as special counsel for West Texas Utilities Company, a
Texas corporation (the "Company"), in connection with the proposed public
offering from time to time of up to $45,000,000 aggregate principal amount of
the Company's First Mortgage Bonds together with such additional principal
amount of such bonds which may be registered pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, (the "Securities Act") (the "Bonds"), to
be issued in one or more series pursuant to an Indenture, dated August 1, 1943
(the "Indenture"), between the Company and Harris Trust and Savings Bank and
J. Bartolini, as trustees, as heretofore amended, and to be further amended by
one or more Supplemental Indentures to be entered into in connection with the
creation and issuance of each series of the Bonds (each, a "Supplemental
Indenture"). In connection with the proposed offering, the Company proposes
to file a registration statement on Form S-3 (the "Registration Statement"),
and may file an additional registration statement on Form S-3 to register
Bonds pursuant to Rule 462(b) (the "Abbreviated Registration Statement"), with
the Securities and Exchange Commission for the purpose of registering the
Bonds under the Securities Act, for sale pursuant to one or more underwriting
agreements in the form filed as an exhibit to the Registration Statement
(each, an "Underwriting Agreement").
We have examined originals, or copies certified to our satisfaction,
of such corporate records of the Company, certificates of public officials,
certificates of officers and representatives of the Company and other
documents as we have deemed necessary as a basis for the opinions hereinafter
expressed. In our examination we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals
and the conformity with the originals of all documents submitted to us as
copies. As to various questions of fact material to such opinions we have,
when relevant facts were not independently established, relied upon
certifications by officers of the Company and other appropriate persons and
statements contained in the Registration Statement or Abbreviated Registration
Statement.
<PAGE> 3
Based on the foregoing, and having regard to legal considerations
which we deem relevant, we are of the opinion that, assuming that the
Indenture has been duly authorized, executed and delivered, when the
Supplemental Indenture with respect to a series of Bonds has been duly
authorized, executed and delivered, and when the Bonds of such series have
been duly authorized, executed, authenticated and issued in accordance with
the terms of the Indenture and the applicable Supplemental Indenture and
delivered against payment therefor in accordance with the terms of the
applicable Underwriting Agreement, the Bonds of such series will constitute
legal, valid and binding obligations of the Company, entitled to the benefits
of, and subject to the provisions of, the Indenture and the applicable
Supplemental Indenture, subject, however, to the fact that certain of the
remedial provisions of the Indenture may be limited or rendered unenforceable
by the laws of the States wherein the mortgaged property is situated (but said
laws do not, in our opinion, make the remedies afforded by the Indenture
inadequate for the realization of the benefits of the security provided
thereby), and except (a) as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws of general applicability
affecting the enforcement of creditors' rights, and (b) that such
enforceability may be limited by the application of general principles of
equity (regardless of whether considered in a proceeding in equity or at law),
including without limitation (i) the possible unavailability of specific
performance, injunctive relief or any other equitable remedies and (ii)
concepts of materiality, reasonableness, good faith and fair dealing.
We do not express any opinion as to matters governed by any laws
other than the laws of the State of New York and the Federal laws of the
United States of America.
We hereby consent to the reference to us under the heading "Legal
Opinions" in the Prospectus constituting a part of the Registration Statement
and to the filing of this opinion as Exhibit 5 to the Registration Statement
and the Abbreviated Registration statement.
This opinion may be incorporated by reference into the Abbreviated
Registration Statement.
Very truly yours,
/s/ MILBANK, TWEED, HADLEY & MCCLOY
Milbank, Tweed, Hadley & McCloy
RBW/GJF
<PAGE> 1
EXHIBIT 23(a)
<PAGE> 2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated February 13,
1995, incorporated by reference in West Texas Utilities Company's Annual
Report on Form 10-K for the year ended December 31, 1994, and to all
references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
/s/ ARTHUR ANDERSEN LLP
Dallas, Texas
June 30, 1995
<PAGE> 1
EXHIBIT 25(a)
<PAGE> 2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
Statement of Eligibility
Under the Trust Indenture Act of 1939
of a Corporation Designated to Act as
Trustee
Check if an Application to Determine
Eligibility of a Trustee Pursuant to Section
305(b)(2) _______________
HARRIS TRUST AND SAVINGS BANK
(Name of Trustee)
Illinois 36-1194448
(State of incorporation) (I.R.S. employer
identification No.)
111 West Monroe Street, Chicago, Illinois 60603
(Address of principal executive offices)
Daryl L. Pomykala, Harris Trust and Savings Bank,
111 West Monroe Street
Chicago, Illinois 60603
312-461-7458
(Name, address and telephone number for agent for service)
WEST TEXAS UTILITIES COMPANY
(Name of obligor)
TEXAS 75-0646790
(State of incorporation) (I.R.S.employer
identification No.)
301 Cypress
Abilene, Texas 79604
(Address of principal executive offices)
First Mortgage Bonds
(Title of indenture securities)
<PAGE> 3
1. GENERAL INFORMATION. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Commissioner of Banks and Trust Companies, State of
Illinois, Springfield, Illinois; Chicago Clearing House
Association, 164 West Jackson Boulevard, Chicago, Illinois;
Federal Deposit Insurance Corporation, Washington, D.C.; The
Board of Governors of the Federal Reserve System,Washington,
D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Harris Trust and Savings Bank is authorized to exercise
corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the
Trustee, describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
3. thru 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee is now in
effect which includes the authority of the trustee to commence
business and to exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between
Harris Trust and Savings Bank, HTS Bank and Harris Bankcorp, Inc.
which constitutes the articles of association of the Trustee as
now in effect and includes the authority of the Trustee to
commence business and to exercise corporate trust powers was filed
in connection with the Registration Statement of Louisville Gas
and Electric Company, File No. 2-44295, and is incorporated herein
by reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in
connection with the Registration Statement of Hillenbrand
Industries, Inc., File No. 33-44086, and is incorporated herein by
reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 2 of this statement)
<PAGE> 4
4. A copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or
examining authority.
(included as Exhibit B on page 3 of this statement)
<PAGE> 5
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all
in the City of Chicago, and State of Illinois, on the 2nd day of June, 1995.
HARRIS TRUST AND SAVINGS BANK
By:__________________________
Daryl L. Pomykala
Trust Officer
<PAGE> 6
EXHIBIT A
The consents of the trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents
that reports of examinations of said trustee by Federal and State authorities
may be furnished by such authorities to the Securities and Exchange Commission
upon request therefor.
HARRIS TRUST AND SAVINGS BANK
By:__________________________
Daryl L. Pomykala
Trust Officer
<PAGE> 7
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of December 31, 1994, as published in accordance
with a call made by the State Banking Authority and by the Federal Reserve
Bank of the Seventh Reserve District.
[HARRIS LOGO]
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on December 31, 1994, a state banking institution organized and
operating under the banking laws of this State and a member of the Federal
Reserve System. Published in accordance with a call made by the Commissioner
of Banks and Trust Companies of the State of Illinois and by the Federal
Reserve Bank of this District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION> THOUSANDS
ASSETS OF DOLLARS
<S> <C> <C>
Cash and balances due from depository institutions:
Non-interest bearing balances and currency and coin ..... $1,226,753
Interest bearing balances ............................... $732,083
Securities: ..................................................
a. Held-to-maturity securities $718,072
b. Available-for-sale securities $1,795,896
Federal funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ...................................... $374,200
Securities purchased under agreements to resell ......... $9,831
Loans and lease financing receivables:
Loans and leases, net of unearned income ................ $6,371,039
LESS: Allowance for loan and lease losses .............. $90,492
Loans and leases, net of unearned income,
allowance, and reserve (item 4.a minus 4.b) ............ $6,280,547
Assets held in trading accounts ............................. $169,830
Premises and fixed assets (including capitalized leases)..... $136,703
Other real estate owned ..................................... $1,780
Investments in unconsolidated subsidiaries and
associated companies ...................................... $37
Customer's liability to this bank on acceptances
outstanding ............................................... $69,447
Intangible assets ........................................... $24,851
Other assets ................................................ $403,300
TOTAL ASSETS $11,944,330
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION> LIABILITIES
<S> <C> <C>
Deposits:
In domestic offices ..................................... $4,529,148
Non-interest bearing ................................ $2,659,945
Interest bearing .................................... $1,869,203
In foreign offices, Edge and Agreement subsidiaries,
and IBF's ............................................. $2,486,418
Non-interest bearing ................................ $31,903
Interest bearing .................................... $2,454,515
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the
bank and of its Edge and Agreement subsidiaries, and
in IBF's:
Federal funds purchased ................................. $1,179,441
Securities sold under agreements to repurchase .......... $1,643,381
Trading Liabilities $149,363
Other borrowed money: ........................................
a. With original maturity of one year or less $667,231
b. With original maturity of more than one year $14,268
Bank's liability on acceptances executed and
outstanding Subordinated notes and debentures .............. $235,000
Other liabilities ............................................ $240,902
TOTAL LIABILITIES $11,214,599
EQUITY CAPITAL
Common Stock ................................................. $100,000
Surplus ...................................................... $275,000
a. Undivided profits and capital reserves ................... $375,032
b. Net unrealized holding gains (losses) on
available-for-sale securities $(20,301)
TOTAL EQUITY CAPITAL $729,731
Total liabilities, limited-life preferred stock,
and equity capital ......................................... $11,944,330
</TABLE>
I, Paul Skubic, Controller of the above-named bank, do hereby declare
that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System
and is true to the best of my knowledge and belief.
PAUL SKUBIC
1/27/95
<PAGE> 9
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and, to the best of
our knowledge and belief, has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System
and the Commissioner of Banks and Trust Companies of the State of Illinois and
is true and correct.
DONALD S. HUNT,
RICHARD E. TERRY,
JAMES J. GLASSER,
Directors.
<PAGE> 1
EXHIBIT 25(b)
<PAGE> 2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-2
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939
OF AN INDIVIDUAL DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine
Eligibility of a Trustee Pursuant to Section
305(b)(2) ______________
J. Bartolini ###-##-####
(Name of Trustee) (Social security number)
111 West Monroe Street
Chicago, Illinois 60603
(Business Address)
WEST TEXAS UTILITIES COMPANY
(Name of Obligor)
Texas 75-0646790
(State of incorporation) (I.R.S. employer
identification number)
301 Cypress
Abilene Texas 79604
(Address of principal executive offices)
First Mortgage Bonds
(Title of indenture securities)
<PAGE> 3
1. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the
trustee, describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
2. TRUSTEESHIPS UNDER OTHER INDENTURES. If the trustee is a trustee under
another indenture under which any other securities, or certificates of
interest or participation in any other securities, of the obligor are
outstanding, file a copy of each such indenture as an exhibit and
furnish the following information:
(a) Title of securities outstanding under each such other indenture.
None
(b) A brief statement of the facts relied upon by the trustee as a basis
for the claim that no conflicting interest within the meaning of
Section 310(b)(1) of the Act arises as a result of the trusteeship
under such other indenture, including a statement as to how the
indenture securities will rank as compared with the securities
issued under such other indenture.
Not applicable
3. thru 10.
NO RESPONSE NECESSARY
11. LIST OF EXHIBITS
None
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, I, J.
Bartolini, have signed this statement of eligibility in the City of Chicago,
and the State of Illinois, on the 2nd day of June, 1995.
__________________________
J. Bartolini
(Signature of Trustee)
<PAGE> 1
EXHIBIT 26
<PAGE> 2
___________________________________________________________
WEST TEXAS UTILITIES COMPANY
First Mortgage Bonds, Series __, ____%
Due _______________, ____
INVITATION FOR BIDS
TERMS AND CONDITIONS RELATING TO BIDS
FORM OF BID ACKNOWLEDGEMENT
________________ __, 19__
___________________________________________________________
<PAGE> 3
[Form of Invitation for Competitive Bid]
[Date]
Dear :
West Texas Utilities Company is requesting bids with respect to the issuance
and sale of up to $___________ of its First Mortgage Bonds, Series __, due
__________ __, ____ (the "Bonds"). Bids will not be accepted for less than
the entire amount. You will be notified by telephone or telecopy of any
reduction no later than 10:00 a.m. New York Time on __________ __, ____.
The Company is requesting that bids be made to it by telephone between 11:30
a.m. and 12:00 noon New York Time on __________ __, ____. Your bid should be
made by telephone to a representative of the Company in Dallas, Texas at (214)
777-____. The specific terms of the Bonds with respect to sinking fund and
redemption prices, interest payment dates, etc., are included in Appendix A to
this letter. The telephone bid on __________ __, ____ should include the
coupon rate and the price to be paid to the Company. The Registration
Statement on Form S-3 relating to the Bonds is effective. The Bonds have
received preliminary ratings of ___ by ___________________________________.
Representatives of the Company will notify you by 12:30 p.m. New York Time on
the _____ if your bid has been accepted or rejected by the Company.
The Company will require that each bidder or representative of a group of
bidders, whether successful or not, fill in and return to me the enclosed Bid
Acknowledgement Form after the bids are made on __________ __, ____.
Your bid should be for the entire principal amount of First Mortgage Bonds
with a __-year maturity. The Company will not accept bids for other than a
__-year maturity or with sinking fund or other provisions or terms not in
accordance with Appendix A.
The closing of the sale of the Bonds shall occur on _______, ___________ ____,
at the offices of _________________________________________. Payment for the
Bonds shall be made in immediately available funds.
Representatives of the Company will be available by telephone at (214) 777-
____ between 2:00 p.m. and 3:00 p.m. New York Time on __________ __, ____ to
answer any due diligence questions you may have.
If you have any questions on the above procedures or the mechanics for this
security issue, please do not hesitate to call me or Counsel for the
Underwriters, _____________________________________________________________.
Sincerely,
Stephen D. Wise
<PAGE> 4
BID ACKNOWLEDGEMENT
This Bid Acknowledgement must be returned promptly after submission of your
bid, whether accepted or rejected, for the purchase of $___,___,___ of West
Texas Utilities Company's First Mortgage Bonds, Series __, Due __________ __,
____ and not later than 11:30 a.m., New York Time. Bids are requested on
___________ __, 199_ between 10:30 a.m. and 11:00 a.m., New York Time.
Coupon _______________________ Price to Company ____________________
Signature ___________________________
Return to:
Stephen D. Wise
Central and South West Corporation
P. O. Box 660164
Dallas, Texas 75266-0164
<PAGE> 5
APPENDIX A
Certain Terms Applicable to the Proposed Issuance of
$___________ Principal Amount of First Mortgage Bonds
("Bonds") of West Texas Utilities Company
- - Aggregate principal amount of Bonds to be offered:
- - Price to be paid to Company (exclusive of accrued interest to be added to
such price from ___________ __, ____):
- - Maturity date of Bonds: ___________ __, ____
- - Supplemental Indenture Date (and date of the Bonds): ___________ __, ____
- - Interest payment dates: Semi-annually on __________ __ and __________ __
(commencing on ___________ __, ____)
- - Redemption Provisions: To be determined
