As filed with the Securities and Exchange Commission on May 20, 1999
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EL PASO ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 76-0568816
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
(713) 420-2131
(Address, including zip code, of Principal Executive Offices)
EL PASO ENERGY CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plans)
Britton White Jr., Esq.
Executive Vice President and General Counsel
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
(713) 420-2131
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Registration
to be registered Registered<F2> Per Share<F1> Offering Price<F1> Fee<F1>
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock (including 2,000,000 $35.5625 $71,125,000 $19,772.75
associated preferred
stock purchase rights)
- -------------------------------------------------------------------------------------------
<FN>
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as amended,
this registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
<F1> Estimated solely for the purpose of calculating the registration fee pursuant to
Rule 457(h), based upon the average of the high and low prices of a share of the
Registrant's Common Stock for May 17, 1999 as reported on the New York Stock
Exchange and in The Wall Street Journal on May 18, 1999.
<F2> Includes an indeterminate amount of additional shares which may be necessary to
adjust the number of shares reserved for issuance pursuant to the El Paso Energy
Corporation Employee Stock Purchase Plan as a result of any future stock split,
stock dividend or similar adjustment of the outstanding Common Stock of the
Registrant.
</FN>
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I
of the General Instructions to the Registration Statement on Form
S-8 will be sent or given to employees of the Registrant selected
to participate in the Plan as required by Rule 428(b)(1)
promulgated under the Securities Act of 1933, as amended (the
"Securities Act"). These documents and the documents
incorporated herein by reference pursuant to Item 3 of Part II of
this Registration Statement taken together, constitute a
prospectus that meets the requirements of Section 10(a) of the
Securities Act (the "Prospectus").
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and
Exchange Commission (the "Commission") by El Paso Energy
Corporation (the "Registrant") pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act") are hereby
incorporated by reference in this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for
the year ended December 31, 1998, which contains audited
financial statements for the most recent year for which such
statements have been filed;
(b) All other reports filed by the Registrant pursuant
to Section 13(a) or 15(d) of the Exchange Act, since the end
of the fiscal year covered by the Annual Report referred to
in (a) above; and
(c) The description of the Registrant's common stock,
par value $3.00 per share (the "Common Stock"), contained in
the Registrant's Registration Statement on Form 8-A filed
with the Commission on August 3, 1998, and a description of
the Registrant's preferred stock purchase rights associated
with its Common Stock, contained in Registrant's
Registration Statement on Form 8-A/A filed with the
Commission on January 29, 1999, pursuant to Section 12 of
the Exchange Act, including any amendments or reports filed
for the purposes of updating such descriptions.
All documents filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the
date of this Registration Statement and prior to the filing of a
post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all such
securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to
be a part hereof from the date of filing such documents. Any
statement contained herein or in a document incorporated or
deemed to be incorporated by reference shall be deemed to be
modified or superseded for purposes of the Registration Statement
and the Prospectus to the extent that a statement contained
herein or in any subsequently filed document which also is, or is
deemed to be, incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of the Registration Statement or
Prospectus.
Item 4. Description of Securities.
The information required by Item 4 is not applicable to this
Registration Statement.
Item 5. Interests of Named Experts and Counsel.
The information required by Item 5 is not applicable to this
Registration Statement.
Item 6. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of
Delaware provides that a corporation may indemnify directors and
officers as well as other employees and individuals against
expenses (including attorneys' fees), judgements, fines and
amounts paid in settlement in connection with specified actions,
suits or proceedings if they acted in good faith and in a manner
they reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe their
conduct was unlawful. Similar indemnity is authorized for such
persons against expenses (including attorneys' fees) actually and
reasonably incurred in connection with the defense or settlement
of any such threatened, pending or completed action or suit if
such person acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the
corporation, and provided further that (unless a court of
competent jurisdiction otherwise provides) such person shall not
have been adjudged liable to the corporation. The statute
provides that it is not exclusive of other indemnification that
may be granted by a corporation's by-laws, disinterested director
vote, stockholder vote, agreement or otherwise.
Article X of the By-laws of the Registrant requires
indemnification to the full extent permitted under Delaware
law as from time to time in effect. Subject to any
restrictions imposed by Delaware law, the By-laws provide an
unconditional right to indemnification for all expense,
liability and loss (including attorneys' fees, judgements,
fines, ERISA excise taxes or penalties and amounts paid in
settlement) actually and reasonably incurred or suffered by
any person in connection with any actual or threatened
proceeding (including, to the extent permitted by law, any
derivative action) by reason of the fact that such person is
or was serving at the request of the Registrant as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise,
including an employee benefit plan. The By-laws also
provide that the Registrant may, by action of its Board of
Directors, provide indemnification to its agents with the
same scope and effect as the foregoing indemnification of
directors and officers.
Section 102(b)(7) of the General Corporation Law of the
State of Delaware permits a corporation to provide in its
certificate of incorporation that a director of the
corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, except for liability
for (i) any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) acts or omissions not
in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) payment of unlawful
dividends or unlawful stock purchases or redemptions, or
(iv) any transaction from which the director derived an
improper personal benefit.
Article 10 of the Registrant's Restated Certificate of
Incorporation, as amended, provides that to the full extent
that the General Corporation Law of the State of Delaware,
as it now exists or may hereafter be amended, permits the
limitation or elimination of the liability of directors, a
director of the Registrant shall not be liable to the
Registrant or its stockholders for monetary damages for
breach of fiduciary duty as a director. Any amendment to or
repeal of such Article 10 shall not adversely affect any
right or protection of a director of the Registrant for or
with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.
The Registrant maintains Directors' and Officers' liability
insurance which provides for payment on behalf of the
directors and officers of all losses of such persons (other
than matters uninsurable under the law) arising from claims,
including claims arising under the Securities Act, for acts
or omissions by such persons while acting as directors or
officers.
Item 7. Exemption from Registration Claimed.
The information required by Item 7 is not applicable to this
Registration Statement.
Item 8. Exhibits.
Exhibit
Number Description
5.1 Opinion of Andrews & Kurth L.L.P. regarding the
legality of the securities being registered
hereunder.
10.1 El Paso Energy Corporation Employee Stock Purchase
Plan effective as of January 20, 1999.
23.1 Consent of Counsel (included in the opinion filed as
Exhibit 5.1 to this Registration Statement).
23.2 Consent of PricewaterhouseCoopers LLP.
24.1 Power of Attorney (set forth on the signature page
contained in Part II of this Registration
Statement).
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this
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;
(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 paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to
the Commission by the registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, 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.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to
Section 13(a) or 15(d) of the Exchange Act that is incorporated
by reference in this Registration Statement shall be deemed to be
a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act 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 Commission such
indemnification is against public policy as expressed in the
Securities 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 Securities Act and will be governed by the final adjudication
of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, the Registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of
Texas, on this 20th day of May 1999.
EL PASO ENERGY CORPORATION
By: /s/ William A. Wise
------------------------------
William A. Wise
Chairman of the Board,
President
and Chief Executive
Officer
POWER OF ATTORNEY
Each person whose individual signature appears below hereby
authorizes H. Brent Austin and Britton White Jr., and each of
them, as attorneys-in-fact with full power of substitution, to
execute in the name and on behalf of such person, individually
and in each capacity stated below, and to file, any and all
amendments to this Registration Statement, including any and all
post-effective amendments.
Pursuant to the requirements of the Securities Act of 1933,
as amended, this Registration Statement has been signed by the
following persons in the capacities and on the dates as
indicated.
----------------------------------------------------------------
Signature Title Date
----------------------------------------------------------------
/s/ William A. Wise Chairman of the Board, May 20, 1999
-------------------- President, Chief
William A. Wise Executive Officer and
Director
/s/ H. Brent Austin Executive Vice May 20, 1999
------------------- President
H. Brent Austin and Chief Financial
Officer
/s/ Jeffrey I. Beason Vice President and May 20, 1999
--------------------- Controller
Jeffrey I. Beason (Chief Accounting
Officer)
/s/ Byron Allumbaugh Director May 20, 1999
----------------------
Byron Allumbaugh
/s/ Juan Carlos Braniff Director May 20, 1999
----------------------
Juan Carlos Braniff
/s/ Peter T. Flawn Director May 20, 1999
----------------------
Peter T. Flawn
/s/ James F. Gibbons Director May 20, 1999
---------------------
James F. Gibbons
/s/ Ben F. Love Director May 20, 1999
---------------------
Ben F. Love
/s/ Kenneth L. Smalley Director May 20, 1999
---------------------
Kenneth L. Smalley
/s/ Malcolm Wallop Director May 20, 1999
---------------------
Malcolm Wallop
<PAGE>
The Plan. Pursuant to the requirements of the Securities Act of
1933, as amended, the trustees (or other persons who administer
the employee benefit plan) have duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of
Texas, on this 20th day of May 1999.
EL PASO ENERGY CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
By: /s/ H. Brent Austin
--------------------------
H. Brent Austin
Executive Vice President
and Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
5.1 Opinion of Andrews & Kurth L.L.P. regarding the
legality of the securities being registered
hereunder.
10.1 El Paso Energy Corporation Employee Stock Purchase
Plan, effective as of January 20, 1999.
23.1 Consent of Counsel (included in the opinion filed as
Exhibit 5.1 to this Registration Statement).
23.2 Consent of PricewaterhouseCoopers LLP.
24.1 Power of Attorney (set forth on the signature page
contained in Part II of this Registration
Statement).
EXHIBIT 5
[LETTERHEAD OF ANDREWS & KURTH L.L.P.]
May 20, 1999
Board of Directors
El Paso Energy Corporation
El Paso Energy Building
1001 Louisiana Street
Houston, Texas 77002
Gentlemen:
We have acted as special counsel to El Paso Energy Corporation, a Delaware
corporation (the "Company"), in connection with the preparation and filing with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act"), of the registration statement on Form S-8
filed by the Company with the Commission on May 20, 1999 (the "Registration
Statement"), with respect to the offering and sale by the Company of up to
2,000,000 shares (the "Shares") of the Company's common stock, par value $3.00
per share, in connection with the El Paso Energy Corporation Employee Stock
Purchase Plan (the "Plan").
In arriving at the opinion expressed below, we have examined the Company's
Certificate of Incorporation and By-laws, each as amended to date, the
Registration Statement, and the originals or copies certified or otherwise
identified to our satisfaction of such other instruments and other certificates
of public officials, officers and representatives of the Company and such other
persons, and we have made such investigations of law, as we have deemed
appropriate as a basis for the opinions expressed below.
In rendering the opinion expressed below, we have assumed and have not
verified (i) the genuineness of the signatures on all documents that we have
examined, (ii) the conformity to the originals of all documents supplied to us
as certified or photostatic or faxed copies, (iii) the authenticity of the
originals of such documents and (iv) as to the forms of all documents in respect
of which forms were filed with the Commission as exhibits to the Registration
Statement, the conformity in all material respects of such documents to the
forms thereof that we have examined.
Based on the foregoing, and subject to the limitations and exceptions set
forth below, it is our opinion that the Shares will, when issued and paid for
in accordance with the terms of the Plan, be duly authorized, validly issued,
fully paid and nonassessable.
For the purposes of the opinion expressed above, we have assumed that the
Registration Statement, and any amendments thereto (including post-effective
amendments), will have become effective.
We express no opinion other than as to the federal laws of the United
States of America and the Delaware General Corporation laws. We hereby
consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to this firm under the heading "Legal Matters"
in the prospectus forming part of the Registration Statement without admitting
that we are "experts" under the Act, or the rules and regulations of the
Commission issued thereunder, with respect to any part of the Registration
Statement, including this exhibit. This opinion is rendered solely for your
benefit in connection with the above matter and may not be relied upon in any
manner by any other person or entity without our express written consent.
Very truly yours,
/s/ Andrews & Kurth L.L.P.
EXHIBIT 10.1
EL PASO ENERGY CORPORATION
EMPLOYEE STOCK
PURCHASE PLAN
Effective as of January 20, 1999
<PAGE>
EL PASO ENERGY CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
1. Purposes
This Employee Stock Purchase Plan (the "Plan"),
effective as of January 20, 1999, provides Eligible
Employees of El Paso Energy Corporation, a Delaware
corporation, and its Subsidiaries an opportunity to (i)
purchase shares of Common Stock of the Company at a discount
from market prices, and (ii) increase ownership of the
Company's Common Stock, on the terms and conditions set
forth below. It is the intention of the Company that
options issued pursuant to the Plan shall constitute stock
options issued pursuant to an "employee stock purchase plan"
within the meaning of Section 423 of the Code. The
provisions of the Plan shall be construed so as to extend
and limit participation in the Plan in a manner consistent
with the requirements of that section of the Code.
2. Definitions
(a) Board of Directors-means the Board of Directors of El
Paso Energy Corporation.
(b) Company-means El Paso Energy Corporation, a
Delaware corporation.
(c) Compensation-means the total annual cash
remuneration (before taxes) which an Eligible Employee
receives as salary or wages, including base pay, payments
for overtime, shift premium, bonuses, holiday pay, paid time
off, short-term disability and other similar remuneration
(grossed-up to reflect salary deferrals, if any, under
Section 401(k) plans, Section 125 cafeteria plans, Section
132 plans and other qualified and nonqualified elective
deferrals). Compensation shall not include other cash or
non-cash remuneration such as payments under this or any
other form of equity or fringe benefit program, expense
reimbursements, allowances and payments attributable to
foreign assignments, long-term disability and workers'
compensation payments, and lump-sum payments due to death,
termination of employment or layoff.
(d) Code-means the Internal Revenue Code of 1986, as
amended.
(e) Committee-means the Compensation Committee of the
Board of Directors with respect to Participants who are
subject to Section 16 of the Securities Exchange Act of
1934, as amended, if required, and the Management
Committee (consisting of the Chief Executive Officer
and such other senior officers of the Company as he or
she may designate) with respect to all other
Participants.
(f) Common Stock-means the common stock, par value
$3.00 per share, of the Company.
(g) Eligible Employees-means those employees of the
Company and its Subsidiaries who are eligible to
participate in the Plan pursuant to Section 4.
(h) Exercise Date-means the last Trading Day of each
calendar quarter; provided, however, that with respect
to the first Offering Period, the first Exercise Date
shall be the last Trading Day of the calendar quarter
following stockholder approval of the Plan.
(i) Exercise Price-means, with respect to any Offering
Period, the lesser of (i) 85% of the Fair Market Value
of a share of the Company's Common Stock on the Grant
Date, and (ii) 85% of the Fair Market Value of such
share on the Exercise Date.
(j) Fair Market Value-means the average between the
highest and lowest quoted selling prices at which the
Company Common Stock is sold for a particular date as
reported in the NYSE-Composite Transactions by The Wall
Street Journal (or such other source as the Committee
deems reliable) for such date, or if no Common Stock
was traded on such date, on the next preceding day on
which Common Stock was so traded. In the absence of an
established market for the Common Stock, the Fair
Market Value thereof shall be determined in good faith
by the Committee.
(k) Grant Date-means the first Trading Day of the
calendar year, or with respect to the 1999 calendar
year, the first Trading Day of the Plan's first
Offering Period.
(l) Offering Period-means any twelve-month period
beginning on the first Trading Day of a particular
calendar year and ending on the last Trading Day of
such calendar year, except that with respect to the
1999 calendar year, the Offering Period shall begin on
the effective date of the Plan and end on the last
Trading Day of such calendar year.
(m) Participating Employee-means an Eligible Employee
who elects to participate in the Plan pursuant to
Section 5 hereof.
(n) Plan Account-means an account maintained by the
Company or its designated record keeper/custodian for
each Eligible Employee participating in the Plan to
which payroll deductions are credited, against which
funds used to purchase shares of Common Stock are
charged, and to which shares of Common Stock purchased
are credited.
(o) Subsidiary-means a corporation (or other form of
business association that is treated as a corporation
for tax purposes) that is designated by the Committee
from time to time from among a group consisting of the
Company and its subsidiary corporations, for the
purposes of participation in the Plan, of which shares
(or other ownership interests) having more than fifty
percent (50%) of the voting power are owned or
controlled, directly or indirectly, by the Company so
as to qualify such corporation as a "subsidiary
corporation" within the meaning of Section 424(f) of
the Code. The participating Subsidiaries are set forth
on Appendix A hereto, and are subject to change by the
Committee.
(p) Trading Day-means any day on which the New York
Stock Exchange (or any other established stock exchange
or national market system the Committee deems
appropriate) is open for trading.
3. Common Stock Subject to the Plan
(a) Subject to Section 3(b), the Company shall make
available two million (2,000,000) shares of its Common Stock
for purchase under the Plan from shares held in the
Company's treasury or out of authorized but unissued shares
of the Company, or partly out of each, as shall be
determined by the Committee.
(b) In the event of a recapitalization, stock split,
stock dividend, exchange of shares, merger, reorganization,
change in corporate structure or shares of the Company or
similar event, the Board of Directors, upon the
recommendation of the Committee, may make appropriate
adjustments in the number of shares authorized for the Plan
and with respect to number of shares credited to each
Participating Employee's Plan Account.
4. Eligible Employees
(a) An "Eligible Employee" is any individual who, as of
the beginning of an Offering Period, is a common law
employee of the Company or a Subsidiary and whose
customary employment with the Company or such
Subsidiary is at least twenty (20) hours per week and
more than five (5) months in any calendar year. For
purposes of the Plan, the employment relationship shall
be treated as continuing while the individual is on a
short-term leave, approved by the Company or any
Subsidiary, during which the employee receives no
Compensation. To the extent required under Section 423
of the Code, where the period of unpaid leave exceeds
90 days and the individual's right to reemployment is
not guaranteed by statute or by contract, the employee
relationship will be deemed to have terminated on the
91st day of such leave.
(b) No Eligible Employee shall be granted an option to
purchase shares of Common Stock on any Grant Date if
such employee, immediately after the option is granted,
owns stock possessing five percent (5%) or more of the
Company's outstanding Common Stock or five percent (5%)
or more of the total combined voting power or value of
all classes of stock of the Company or any Subsidiary.
For purposes of this Section 4(b), the rules of Code
Section 424(d) (relating to attribution of stock
ownership) shall apply in determining the stock
ownership of an Eligible Employee, and stock which the
employee may purchase under outstanding options
(whether or not subject to the special tax treatment
provided by the Plan) shall be treated as stock owned
by such employee.
(c) Notwithstanding any other provision of the Plan to
the contrary, no Eligible Employee shall be granted an
option to purchase shares of Common Stock under the
Plan which permits such employee's rights to purchase
stock under all employee stock purchase plans that are
intended to qualify under Code Section 423 and that are
maintained by the Company and its Subsidiaries to
accrue at a rate which exceeds twenty-five thousand
U.S. dollars ($25,000) (or the equivalent thereof in
other currencies) worth of stock determined at the Fair
Market Value of the shares on the Grant Date for each
calendar year. This paragraph shall be interpreted in
accordance with applicable Code rules and regulations.
5. Participation in the Plan
An Eligible Employee may participate in the Plan by
completing and filing with the Company, or its
designated record keeper/custodian, an election form or
responding to enrollment procedures as set forth in a
voice response system which authorizes payroll
deductions from the employee's Compensation. Such
deductions shall commence with the first pay period in
the Offering Period beginning after such form is filed
and recorded with the Company or its designated record
keeper/custodian and shall continue until the employee
ceases participation in the Plan or the Plan is
terminated. Notwithstanding the foregoing, with respect
to the first Offering Period, payroll deductions will
commence in the month immediately following stockholder
approval of the Plan.
6. Payroll Deductions
Payroll deductions shall be made from the Compensation
paid to each Participating Employee for each regular
payroll period in such amounts as the Participating
Employee shall authorize in his or her election form.
The minimum payroll deduction shall be ten U.S. dollars
($10) per month up to a maximum of twenty-one thousand
two hundred fifty U.S. dollars ($21,250) per calendar
year, with such deductions to be made from only the
regular base salary payroll processing cycle (and not
from bonus or other special payroll processing events).
All payroll deductions made for a Participating
Employee shall be credited to his or her Plan Account.
Unless the Committee otherwise provides, if a
Participating Employee's Compensation is insufficient
in any pay period to allow the entire payroll deduction
contemplated under the Plan, all such available amounts
shall be deducted and credited to the Participating
Employee's Plan Account for such pay period. Payroll
deductions under the Plan shall be made only after all
other withholdings, deductions, garnishments and the
similar deductions have been made. Notwithstanding any
other provision to the contrary, the Committee may
allow, subject to such terms and conditions as the
Committee determines appropriate, Participating
Employees to provide other sources of funds to satisfy
such Participating Employees elected contributions, but
in no event shall the total annual contribution by a
Participating Employee exceed such Participating
Employee's Compensation.
7. Changes in the Payroll Deductions
Subject to Section 8 below, a Participating Employee
may change the amount of his or her payroll deduction
by filing a new election form with the Company or its
designated record keeper/custodian or responding to a
voice response enrollment system during an enrollment
period, as specified by the Company. The change shall
become effective for the next Offering Period. Except
as set forth in Section 8, other changes shall not be
allowed during an Offering Period.
8. Termination of Participation in the Plan
(a) Voluntary Cessation of Plan Participation. A
Participating Employee, at any time and for any reason,
may voluntarily terminate participation in the Plan by
written notification, or appropriate procedures set
forth in a voice response system or otherwise as the
Company may determine, of withdrawal delivered to the
appropriate payroll office or designated record
keeper/custodian sufficiently in advance, generally ten
(10) Trading Days, to process such changes before the
next pay period. In such event, any payroll deductions
and other funds credited to such Participating
Employee's Plan Account shall be used to purchase
shares of Common Stock on the next Exercise Date unless
such Participating Employee requests to receive such
amounts, in a manner determined by the Committee. An
employee whose participation in the Plan has
voluntarily terminated may not rejoin the Plan until
the next Offering Period following the date of such
termination.
(b) Employment Termination and Death. Unless otherwise
provided in this Section 8, a Participating Employee's
participation in the Plan shall be terminated
involuntarily upon (i) termination of his or her
employment with the Company or its Subsidiaries for any
reason, or (ii) death of the Participating Employee.
In each event, payroll deductions shall cease as of
such termination and all payroll deductions and other
funds (exclusive of dividends and other distributions,
if any) credited to the Participating Employee's Plan
Account, but not yet used to purchase shares of Common
Stock, shall be refunded, without interest, to the
Participating Employee or his or her beneficiary or
estate, as applicable, as soon as practicable following
such termination. However, if such termination occurs
without sufficient time, generally ten (10) Trading
Days, to process such termination prior to an Exercise
Date, the Committee may allow all payroll deductions,
dividends and other distributions credited to such
Participating Employee's Plan Account to be used to
purchase additional shares of Common Stock on the next
Exercise Date.
(c) Retirement and Permanent Disability. In the event
the Participating Employee retires or becomes
permanently disabled, any payroll deductions and other
funds credited to such employee's Plan Account shall be
used to purchase shares of Common Stock on the next
Exercise Date unless the employee requests to receive
such amounts, in a manner determined by the Committee
and such notice is received sufficiently in advance of
the next Exercise Date, generally ten (10) Trading
Days, to process such request.
In the event a Participating Employee's participation
in the Plan is terminated pursuant to this Section 8,
then such Participating Employee may allow shares of
Common Stock credited to the Participating Employee's
(or former employee's) Plan Account to remain therein
(at such person's expense, if any), or at any time,
request withdrawal of all or a portion of such account
in the manner specified in the Plan or by the
Committee.
9. Purchase of Shares
(a) On each Grant Date, each Participating Employee
shall be deemed to have been granted an option to
purchase up to that number shares of Common Stock as
provided in this Section 9.
(b) Each option shall be for a number of shares up to
the maximum number acquirable through the payroll
deductions allowed under Section 6 above, but no more
than two thousand (2,000) shares during any one
Offering Period. Each option shall be for a term of
not more than one year and shall be exercised as
provided below.
(c) On each Exercise Date, each Participating Employee
shall be deemed to have exercised his or her option
granted, pursuant to Section 9(a). On each Exercise
Date, the Company shall apply the funds (exclusive of
dividends and other distributions, if any) credited to
each Participating Employee's Plan Account, pursuant to
Section 6 above, to the purchase (without commissions
or fees) that number of shares of Common Stock
determined by dividing the Exercise Price into the
balance in the employee's Plan Account on the Exercise
Date, subject to the limitations in Sections 4(b) and
4(c).
(d) As soon as practicable after each Exercise Date, a
statement shall be delivered to each Participating
Employee regarding his or her Plan Account, which may
include, among other things and to the extent necessary
and appropriate, (i) the name, address and federal
identification number of the Company and the
Participating Employee; (ii) the amounts of payroll
deductions or other funds credited to the Plan Account;
(iii) the Exercise Price; (iv) the date of purchase or
transfer; (v) the number of shares purchased or
transferred; (vi) a statement that the purchase of
shares is pursuant to a Code Section 423 plan; and
(vii) the balance in the Plan Account.
10. Rights as a Stockholder
(a) As promptly as practicable after each Exercise
Date, a Participating Employee shall be treated as the
beneficial owner of his or her shares purchased
pursuant to the Plan, and such shares shall be credited
to a book-entry account maintained for the benefit of
the Participating Employee by the record
keeper/custodian selected by the Company. A
Participating Employee may request that a stock
certificate for all or a portion of the shares credited
to the Participating Employee's Plan Account be issued,
provided the Participating Employee pays any fees
associated with the issuance of such stock certificate.
A cash payment (less any applicable fees to sell a
fractional share) shall be made for any fraction of a
share of Common Stock in such account, if necessary to
close the account.
(b) A Participating Employee shall have all ownership
rights with respect to the whole number of shares
credited to the Plan Account, including the right to
vote such shares of Common Stock and to receive
dividends or other distributions, if any. Any
dividends or distributions which may be declared
thereon by the Board of Directors will be reinvested by
the record keeper/custodian in additional shares of
Common Stock for the Participating Employee within a
reasonable time (as determined by the Committee)
following such dividend payment date or distribution
date, and shall be invested based upon the Fair Market
Value on the date of such investment (without any
discount).
11. Rights Not Transferable
Rights under the Plan are not transferable by a
Participating Employee other than by will or the laws
of descent and distribution, and are exercisable during
the employee's lifetime only by the employee or by the
employee's guardian or legal representative. No rights
or payroll deductions of a Participating Employee under
the Plan shall be subject to execution, attachment,
levy, garnishment or similar process.
12. Sale of Shares
Should a Participating Employee choose to sell shares
purchased under the Plan, such Participating Employee
shall be responsible to pay any and all applicable
brokerage fees and associated costs related to such
sale. Sales requested by a Participating Employee
shall occur as soon as administratively feasible after
the receipt of such request, but neither the Committee
nor the Company nor any Subsidiary shall be liable for
any delay in the execution of such request.
Participating Employees bear the risk of stock price
fluctuation between the time they place the order to
sell and the time the shares are actually sold.
Additionally, Participating Employees who have
requested to sell shares may receive the average of the
prices of all shares sold under the Plan for a
particular day.
13. Application of Funds
All funds of Participating Employees received or held
by the Company under the Plan before purchase of the
shares of Common Stock may be held in bank accounts of
the Company or may be used by the Company for general
corporate purposes. The Company shall not be obligated
to segregate payroll deductions. No interest shall
accrue on the payroll deductions which are received and
held by the Company under the Plan or credited to the
Participating Employee's Plan Account.
14. Administration of the Plan
The Plan shall be administered by the Committee, which
shall have full and exclusive discretionary authority
to construe, interpret and apply the terms of the Plan,
to determine eligibility and to adjudicate all disputed
claims filed under the Plan. Without limiting the full
discretion of the Committee in the administration of
the Plan, the Committee may limit the percentage or
dollar amount of Compensation that may be contributed
under the Plan, change the frequency of payroll
deductions, modify the frequency or number of changes
in the amount of payroll deductions to be made during
an Offering Period, establish the exchange ratio
applicable to amounts withheld in a currency other than
U.S. dollars, permit payroll withholding in excess of
the amount designated by a Participating Employee in
order to adjust for delays or mistakes in the Company's
processing of properly completed withholding elections,
establish reasonable waiting and adjustment periods
and/or accounting and crediting procedures to ensure
that amounts applied toward the purchase of shares of
Common Stock for each Participating Employee properly
correspond with amounts withheld from the Participating
Employee's Compensation, establish, collect, amend or
waive administrative or other fees to be assessed
Participating Employees incident to their participation
in the Plan (including those fees set forth in Section
12), and establish such other limitations or procedures
as the Committee determines in its sole discretion are
advisable and consistent with the Plan and with the
requirements (including any non-discrimination
requirements) of the Code. The Plan is intended to
qualify as an "employee stock purchase plan" within the
meaning of Section 423 of the Code. Accordingly, the
provisions of the Plan shall be construed so as to
extend and limit participation in a manner consistent
with the requirements of that Section of the Code.
Every finding, decision and determination made by the
Committee shall, to the fullest extent permitted by
law, be final and binding upon all parties.
15. Amendments to the Plan
The Board of Directors may at any time and for any
reason terminate or amend the Plan, and/or delegate
authority for any amendments to the Committee. Except
as provided in Section 16 hereof, no such termination
or amendment shall affect options previously granted or
adversely affect the rights of any Participating
Employee with respect thereto. Without shareholder
consent and without regard to whether any Participating
Employee rights may have been considered to have been
"adversely affected," the Plan may be amended to change
the Offering Periods, change the Exercise Dates,
increase the Exercise Price or change the amount of
allowable payroll deductions. To the extent necessary
to comply with Section 423 of the Code (or any
successor rule or provision or any other applicable
law, regulation or stock exchange rule), the Company
shall obtain shareholder approval of any amendment to
the Plan in such a manner and to such a degree as
required.
16. Change in Control
In the event of a Change in Control of the Company, any
Offering Period then in progress shall be shortened by
setting a new Exercise Date (the "Change of Control Exercise
Date") and any Offering Period then in progress shall end on
the Change of Control Exercise Date. The Change of Control
Exercise Date shall be before the date of the Company's
proposed sale or merger. The Committee shall notify each
Participating Employee in writing, at least ten (10) Trading
Days prior to the Change of Control Exercise Date, that the
Exercise Date for the Participating Employee's option has
been changed to the Change of Control Exercise Date and that
the Participating Employee's option shall be exercised
automatically on the Change of Control Exercise Date, unless
prior to such date the Participating Employee has withdrawn
from the Offering Period, as provided for in Sections 5 and
8 hereof. For purposes of the Plan, a "Change in Control"
shall be deemed to occur: (a) if any person (as such term
is used in Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) is or
becomes the "beneficial owner" (as defined in Rule 13d-3 of
the Exchange Act), directly or indirectly, of securities of
the Company representing twenty percent (20%) or more of the
combined voting power of the Company's then outstanding
securities; (b) upon the first purchase of the Common Stock
pursuant to a tender or exchange offer (other than a tender
or exchange offer made by the Company); (c) upon the
approval by the Company's stockholders of a merger or
consolidation, a sale, or disposition of all or
substantially all the Company's assets or a plan of
liquidation or dissolution of the Company; or (d) if, during
any period of two (2) consecutive years, individuals who at
the beginning of such period constitute the Board cease for
any reason to constitute at least a majority thereof, unless
the election or nomination for the election by the Company's
stockholders of each new director was approved by a vote of
at least two-thirds (2/3) of the directors then still in
office who were directors at the beginning of the period.
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur if the Company either merges or
consolidates with or into another company or sells or
disposes of all or substantially all of its assets to
another company, if such merger, consolidation, sale or
disposition is in connection with a corporate restructuring
wherein the stockholders of the Company immediately before
such merger, consolidation, sale or disposition own,
directly or indirectly, immediately following such merger,
consolidation, sale or disposition at least eighty percent
(80%) of the combined voting power of all outstanding
classes of securities of the company resulting from such
merger or consolidation, or to which the Company sells or
disposes of its assets, in substantially the same proportion
as their ownership in the Company immediately before such
merger, consolidation, sale or disposition.
17. Effective Date, Suspension and Termination of the Plan
(a) The Board of Directors adopted the Plan effective
January 20, 1999, provided that it is approved within twelve
months therefrom by the stockholders of the Company. Should
the Plan fail to become effective because of lack of
approval by the stockholders of the Company, then any credit
balances in the respective employees' Plan Accounts shall be
returned to the employees for whom such Plan Accounts were
established, without the payment of interest.
(b) The Plan shall terminate upon the earliest of (i)
the termination of the Plan by the Board of Directors, as
specified below, (ii) December 31, 2009, or (iii) when no
more shares remain to be purchased under the Plan. The
Board of Directors may terminate the Plan, but only as of
the Trading Day immediately following an Exercise Date. If
on an Exercise Date, Participating Employees in the
aggregate have options to purchase more shares of Common
Stock than are available for purchase under the Plan, each
Participating Employee shall be eligible to purchase a
reduced number of shares of Common Stock on a pro rata basis
and any excess payroll deductions or other monies
contributed by such employee shall be returned to such
employees, all as provided by rules and regulations adopted
by the Committee.
18. Costs
All costs and expenses incurred in administering the
Plan shall be paid by the Company, except that any brokerage
fees or certificate costs incurred in the sale of the shares
of Common Stock by any Participating Employee shall be
handled in accordance with Sections 10 and 12 of the Plan,
and any administrative or other fees established by the
Committee pursuant to Section 14 of the Plan shall be
handled as specified by the Committee.
19. Purchase for Investment Purposes
The Plan is intended to provide shares of Common Stock
for investment and not for resale. The Company does not,
however, intend to restrict or influence any Participating
Employee in the conduct of such employee's own affairs. A
Participating Employee may therefore sell shares of Common
Stock purchased under the Plan at any time the Participating
Employee chooses, subject to compliance with any applicable
federal or state securities laws. Because of certain
federal tax requirements, each Participating Employee
agrees, by enrolling in the Plan, to notify the Company of
any sale or other disposition of shares of Common Stock held
by the Participating Employee less than two (2) years from
the beginning of the Offering Period during which they were
purchased or one (1) year from the Exercise Date, whichever
is longer, indicating the number of such shares of Common
Stock disposed of. The Company shall be entitled to presume
that a Participating Employee has disposed of any shares of
Common Stock for which the Participating Employee has
requested a certificate. All certificates for shares of
Common Stock delivered under the Plan shall be subject to
such stock transfer orders and other restrictions as the
Company may deem advisable under all applicable laws, rules,
and regulations, and the Company may cause a legend or
legends to be put on any such certificates to make
appropriate references to such restrictions.
20. Governmental Regulations
Notwithstanding anything else in the Plan, options
shall not be exercisable or exercised and shares of Common
Stock shall not be issued with respect to an option to
purchase unless the exercise of such option and the issuance
and delivery of shares of Common Stock pursuant thereto
shall comply with all applicable provisions of law, domestic
or foreign, including, without limitation, the Securities
Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon
which the shares of Common Stock may then be listed. As a
condition to the exercise of an option, the Company may
require a Participating Employee to represent and warrant at
the time of any such exercise that the shares of Common
Stock are being purchased only for investment and without
any present intention to sell or distribute such shares of
Common Stock if, in the opinion of counsel for the Company,
such a representation is required by any of the
aforementioned applicable provisions of law.
21. Applicable Law
The Plan shall be interpreted under the laws of the
State of Texas, unless preempted by federal law. The Plan
is not to be subject to the Employee Retirement Income
Security Act of 1974, as amended, but is intended to comply
with Section 423 of the Code. Any provisions required to be
set forth in the Plan by such Code section are hereby
included as fully as if set forth in the Plan in full.
22. Effect on Employment
The provisions of the Plan shall not affect the right
of the Company or any Subsidiary or any Participating
Employee to terminate his or her employment with the Company
or Subsidiary. Any income Participating Employees may
realize as a result of participating in the Plan shall not
be considered as part of a Participating Employee's salary
or used for the calculation of any other pay, allowance,
pension or other benefit unless otherwise permitted by other
benefit plans provided by the Company or its Subsidiaries,
or required by law or by contractual obligations of the
Company or its Subsidiaries.
23. Taxes
At the time an option to purchase is exercised, in
whole or in part, or at the time all or a portion of the
shares of Common Stock purchased under the Plan are disposed
of, the Participating Employee must make adequate provision
for the Company's federal, state, or other tax withholding
obligations, if any, which arise upon the exercise of the
option or the disposition of the shares of Common Stock. At
any time, the Company may, but shall not be obligated to,
withhold from the Participating Employee's Compensation or
other wages or amounts payable to the Participating Employee
(whether or not such person at the time continues to
participate or to be eligible to participate in the Plan,
and regardless of whether or not such person at the time
continues to be employed by the Company or any Subsidiary)
the amount necessary for the Company to meet applicable
withholding obligations, including any withholding required
to make available to the Company any tax deductions or
benefits attributable to any sale or early disposition of
shares of Common Stock by the Participating Employee.
24. Loans
Subject to applicable laws, the Committee may allow
Participating Employees to borrow money against the value of
the Common Stock held in such Participating Employee's Plan
Account. In such event, the Participating Employee and his
or her Plan Account will be subject to certain terms,
conditions and restrictions as the Committee, its designated
record keeper/custodian, or financial institution may deem
necessary or appropriate to secure the shares in the Plan
Account as collateral for such loan.
25. Beneficiaries
A Participating Employee may file with the Company or
its designated record keeper/custodian, a written
designation of a beneficiary who is entitled to receive any
shares of Common Stock, accumulated payroll deductions,
dividends or other distributions, if any, held for the
Participating Employee under the Plan, in the event of the
employee's death. If the Participating Employee is married
and the designated beneficiary is not the spouse, written
spousal consent shall be required for such designation to be
effective. A Participating Employee may change the
designation of a beneficiary at any time by written notice,
unless the current designated beneficiary is a spouse, in
which case, written spousal consent shall be required. If
no beneficiary is designated, the designation is
ineffective, or in the event the beneficiary dies before the
balance of a Participating Employee's Plan Account is paid,
the balance shall be paid to the Participating Employee's
spouse or, if there is no surviving spouse, to his or her
lineal descendants, pro rata, or, if there is no surviving
spouse or any lineal descendant, to the employee's estate.
26. Notices
All notices or other communications by an Eligible
Employee to the Company or a Subsidiary under or in
connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at
the location, or by the person, designated by the Company
for the receipt thereof. All notices and other
communications to any Eligible Employee or Participating
Employee shall be made to the address maintained on the
Company's payroll records.
IN WITNESS WHEREOF, the Company has caused the Plan to
be executed effective as of January 20, 1999.
EL PASO ENERGY CORPORATION
By /s/ Joel Richards
____________________________
Executive Vice President
ATTEST:
By /s/ David L. Siddall
_________________________
Corporate Secretary
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated March
9, 1999 relating to the consolidated financial statements
and financial statement schedule, which appears in El Paso
Energy Corporation's Annual Report on Form 10-K for the year
ended December 31, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Houston, Texas
May 20, 1999
