<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [FEE REQUIRED]
For the Fiscal Year Ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _______________ to _________________
COMMISSION FILE NUMBER 1-7629
A. Full title of the plan and address of the plan, if different from that of
the issuer named below:
HOUSTON INDUSTRIES INCORPORATED
SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
HOUSTON INDUSTRIES INCORPORATED
1111 LOUISIANA STREET
HOUSTON, TEXAS 77002
<PAGE>
TABLE OF CONTENTS
=================
Independent Auditors' Report Page 1
Financial Statements:
Statement of Net Assets Available for Benefits,
December 31, 1996 Page 2
Statement of Net Assets Available for Benefits,
December 31, 1995 Page 3
Statement of Changes in Net Assets Available for
Benefits for the Year Ended December 31, 1996 Page 4
Statement of Changes in Net Assets Available for
Benefits for the Year Ended December 31, 1995 Page 5
Notes to Financial Statements for the Years Ended
December 31, 1996 and 1995 Page 6
Supplemental Schedules:
Supplemental Schedule of Investments,
December 31, 1996 (Item 27a) Page 12
Supplemental Schedule of Assets Purchased and Sold
for the Year Ended December 31, 1996 (Item 27a) Page 14
Supplemental Schedule of 5% Reportable Transactions
for the Year Ended December 31, 1996 (Item 27d) Page 15
Pursuant to Item 4 of Form 11-K, the financial statements and schedules
referred to above have been prepared in accordance with regulations of the
Employee Retirement Income Security Act of 1974.
<PAGE>
INDEPENDENT AUDITORS' REPORT
============================
Houston Industries Incorporated Savings Plan:
We have audited, by fund and in total, the accompanying financial statements of
the Houston Industries Incorporated Savings Plan (the "Plan") as of December 31,
1996 and 1995 and for the years then ended, listed in the Table of Contents.
These financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, by fund and in total,
in all material respects, the net assets available for benefits of the Plan as
of December 31, 1996 and 1995, and the changes in net assets available for
benefits for the years then ended in conformity with generally accepted
accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules,
listed in the Table of Contents, are presented for the purpose of additional
analysis and are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These schedules are the responsibility of the Plan's
management. Such schedules have been subjected to the auditing procedures
applied in our audit of the basic 1996 financial statements and, in our opinion,
are fairly stated in all material respects when considered in relation to the
basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Houston, Texas
June 24, 1997
<PAGE>
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1996
<TABLE>
<CAPTION>
PARTICIPANT INVESTMENT FUNDS
------------------------------------------------------------------------------------------------------
HI CAPITAL GROWTH &
COMMON APPRECIATION INCOME INTERNATIONAL FIXED
STOCK ALLOCATED EQUITY EQUITY EQUITY BALANCED INCOME
FUND ESOP FUND FUND FUND FUND FUND
------------- ------------ ------------ ------------ ---------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS
Common Stock $333,934,344 $114,282,178
Mutual Funds $ 65,790,169 $ 75,017,780 $ 26,159,342 $35,745,324 $7,862,009
Cash Equivalents 2,355,261 490,550
------------ ------------ ------------ ------------ ------------ ----------- ----------
Total 336,289,605 114,772,728 65,790,169 75,017,780 26,159,342 35,745,324 7,862,009
------------ ------------ ------------ ------------ ------------ ----------- ----------
PARTICIPANT LOANS 19,002,176 6,042,980 2,476,202 1,997,369 1,106,943 1,866,560
------------ ------------ ------------ ------------ ------------ ----------- ----------
RECEIVABLES
Dividends and Interest 5,466,007 1,909,245 455,610 91,171 42,538
Fund Transfers (213,432) 101,746 36,721 (2,853) 77,818
Investment Sales 914,887
Contributions
Employers 360,861
Participants 203,283 157,889 159,332 72,825 80,271 16,296
------------ ------------ ------------ ------------ ------------ ----------- ----------
Total 5,455,858 3,184,993 259,635 196,053 525,582 249,260 58,834
------------ ------------ ------------ ------------ ------------ ----------- ----------
TOTAL ASSETS 360,747,639 117,957,721 72,092,784 77,690,035 28,682,293 37,101,527 9,787,403
------------ ------------ ------------ ------------ ------------ ----------- ----------
LIABILITIES
PAYABLES
Administrative Expenses 6,151 2,411 1,618 1,776 916 1,087 599
Interest on ESOP Loans
from Company
ESOP Loans from Company
------------ ------------ ------------ ------------ ------------ ----------- ----------
TOTAL LIABILITIES 6,151 2,411 1,618 1,776 916 1,087 599
------------ ------------ ------------ ------------ ------------ ----------- ----------
NET ASSETS AVAILABLE
FOR BENEFITS $360,741,488 $117,955,310 $ 72,091,166 $ 77,688,259 $ 28,681,377 $37,100,440 $9,786,804
============ ============ ============ ============ ============ =========== ==========
---------------------------
MONEY
MARKET UNALLOCATED
FUND TOTAL ESOP TOTAL
------------ ------------- ------------ ---------------
<S> <C> <C> <C>
ASSETS
INVESTMENTS
Common Stock $448,216,522 $302,285,476 $ 750,501,998
Mutual Funds 210,574,624 210,574,624
Cash Equivalents $ 33,065,117 35,910,928 3,542,777 39,453,705
------------ ------------ ------------ --------------
Total 33,065,117 694,702,074 305,828,253 1,000,530,327
------------ ------------ ------------ --------------
PARTICIPANT LOANS 4,814,510 37,306,740 37,306,740
------------ ------------ ------------ --------------
RECEIVABLES
Dividends and Interest 153,169 8,117,740 4,643,797 12,761,537
Fund Transfers
Investment Sales 914,887 914,887
Contributions
Employers 360,861 360,861
Participants 44,072 733,968 733,968
------------ ------------ ------------ --------------
Total 197,241 10,127,456 4,643,797 14,771,253
------------ ------------ ------------ --------------
TOTAL ASSETS 38,076,868 742,136,270 310,472,050 1,052,608,320
------------ ------------ ------------ --------------
LIABILITIES
PAYABLES
Administrative Expenses 1,048 15,606 15,606
Interest on ESOP Loans
from Company 4,634,564 4,634,564
ESOP Loans from Company 268,686,244 268,686,244
------------ ------------ ------------ --------------
TOTAL LIABILITIES 1,048 15,606 273,320,808 273,336,414
------------ ------------ ------------ --------------
NET ASSETS AVAILABLE
FOR BENEFITS $ 38,075,820 $742,120,664 $ 37,151,242 $ 779,271,906
============ ============ ============ ==============
</TABLE>
See notes to financial statements.
2
<PAGE>
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
PARTICIPANT INVESTMENT FUNDS
------------------------------------------------------------------------------------------------------
HI CAPITAL GROWTH &
COMMON APPRECIATION INCOME INTERNATIONAL FIXED
STOCK ALLOCATED EQUITY EQUITY EQUITY BALANCED INCOME
FUND ESOP FUND FUND FUND FUND FUND
------------- ------------ ------------ ------------ ---------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS
Common Stock $350,713,879 $105,474,793
Mutual Funds $ 49,222,864 $ 56,196,897 $ 20,400,963 $ 33,077,931 $ 8,516,657
Cash Equivalents 6,062,101 1,056,764 37 3 2 2 34
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total 356,775,980 106,531,557 49,222,901 56,196,900 20,400,965 33,077,933 8,516,691
------------ ------------ ------------ ------------ ------------ ------------ ------------
PARTICIPANT LOANS 16,541,941 5,605,702 2,095,627 2,018,765 1,004,079 1,777,468
------------ ------------ ------------ ------------ ------------ ------------ ------------
RECEIVABLES
Dividends and Interest 5,837,034 1,667,598 1,051,966 205,982 215,046 361,188 65,745
Fund Transfers 165,624 (118,171) (7,270) (8,816) (31,387) (2,302)
Contributions
Employers 684,860
Participants 475,067 251,395 244,436 107,420 127,647 28,460
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total 6,477,725 2,352,458 1,185,190 443,148 313,650 457,448 91,903
------------ ------------ ------------ ------------ ------------ ------------ ------------
TOTAL ASSETS 379,795,646 108,884,015 56,013,793 58,735,675 22,733,380 34,539,460 10,386,062
------------ ------------ ------------ ------------ ------------ ------------ ------------
LIABILITIES
PAYABLES
Administrative Expenses 11,497 10,136 2,600 2,819 1,393 1,951 928
Interest on ESOP Loans
from Company
ESOP Loans from Company
------------ ------------ ------------ ------------ ------------ ------------ ------------
TOTAL LIABILITIES 11,497 10,136 2,600 2,819 1,393 1,951 928
------------ ------------ ------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE
FOR BENEFITS $379,784,149 $108,873,879 $ 56,011,193 $ 58,732,856 $ 22,731,987 $ 34,537,509 $ 10,385,134
============ ============ ============ ============ ============ ============ ============
---------------------------
MONEY
MARKET UNALLOCATED
FUND TOTAL ESOP TOTAL
------------ ------------- ------------ --------------
<S> <C> <C> <C>
ASSETS
INVESTMENTS
Common Stock $456,188,672 $348,127,132 $ 804,315,804
Mutual Funds 167,415,312 167,415,312
Cash Equivalents $ 38,116,835 45,235,778 2,850,313 48,086,091
------------ ------------ ------------ -------------
Total 38,116,835 668,839,762 350,977,445 1,019,817,207
------------ ------------ ------------ -------------
PARTICIPANT LOANS 3,645,637 32,689,219 32,689,219
------------ ------------ ------------ --------------
RECEIVABLES
Dividends and Interest 326,420 9,730,979 5,364,517 15,095,496
Fund Transfers 2,322
Contributions
Employers 684,860 684,860
Participants 89,088 1,323,513 1,323,513
------------ ------------ ------------ --------------
Total 417,830 11,739,352 5,364,517 17,103,869
------------ ------------ ------------ --------------
TOTAL ASSETS 42,180,302 713,268,333 356,341,962 1,069,610,295
------------ ------------ ------------ --------------
LIABILITIES
PAYABLES
Administrative Expenses 2,666 33,990 33,990
Interest on ESOP Loans
from Company 3,593,008 3,593,008
ESOP Loans from Company 185,179,187 285,179,187
------------ ------------ ------------ --------------
TOTAL LIABILITIES 2,666 33,990 288,772,195 288,806,185
------------ ------------ ------------ --------------
NET ASSETS AVAILABLE
FOR BENEFITS $ 42,177,636 $713,234,343 $ 67,569,767 $ 780,804,110
============ ============ ============ ==============
</TABLE>
See notes to financial statements.
3
<PAGE>
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
PARTICIPANT INVESTMENT FUNDS
------------------------------------------------------------------------------------------------------
HI CAPITAL GROWTH &
COMMON APPRECIATION INCOME INTERNATIONAL FIXED
STOCK ALLOCATED EQUITY EQUITY EQUITY BALANCED INCOME
FUND ESOP FUND FUND FUND FUND FUND
------------- ------------- ------------- ------------ ------------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends
Common Stock $ 21,705,280 $ 7,036,833
Mutual Funds $ 6,993,538 $ 4,408,329 $ 1,216,654 $ 2,192,818 $ 495,978
Interest 160,910 68,511 1,083 971 822 246 26
NET APPRECIATION IN FAIR
VALUE OF INVESTMENTS (22,903,279) (7,014,195) 3,375,322 10,056,097 2,127,932 1,950,618 (122,126)
------------- ------------- ------------- ------------ ------------- ------------ -----------
Total (1,037,089) 91,149 10,369,943 14,465,397 3,345,408 4,143,682 373,878
------------- ------------- ------------- ------------ ------------- ------------ -----------
CONTRIBUTIONS
Participants 11,293,307 6,158,051 6,159,840 2,951,368 3,134,909 641,254
Employers
Allocations of
ESOP Stock 15,755,612
Cash 264,873 748,189 5,668 10,120 10,091 2,887 978
ESOP Contributions
------------- ------------- ------------- ------------ ------------- ------------ -----------
Total 11,558,180 16,503,801 6,163,719 6,169,960 2,961,459 3,137,796 642,232
------------- ------------- ------------- ------------ ------------- ------------ -----------
INTEREST ON PARTICIPANT
LOANS 1,245,052 513,033 495,379 233,832 242,029 49,161
------------- ------------- ------------- ------------ ------------- ------------ -----------
FUND TRANSFERS (2,269,250) 2,912,324 2,226,531 1,035,281 (2,181,983) (477,051)
------------- ------------- ------------- ------------ ------------- ------------ -----------
ADMINISTRATIVE EXPENSES (105,132) (85) (17,820) (18,968) (10,657) (12,971) (7,294)
------------- ------------- ------------- ------------ ------------- ------------ -----------
BENEFIT PAYMENTS (28,434,422) (7,513,434) (3,861,226) (4,382,896) (1,615,933) (2,765,622) (1,179,256)
------------- ------------- ------------- ------------ ------------- ------------ -----------
INTEREST ON ESOP LOANS
------------- ------------- ------------- ------------ ------------- ------------ -----------
CHANGE IN NET ASSETS
AVAILABLE FOR BENEFITS (19,042,661) 9,081,431 16,079,973 18,955,403 5,949,390 2,562,931 (598,330)
------------- ------------- ------------- ------------ ------------- ------------ -----------
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 379,784,149 108,873,879 56,011,193 58,732,856 22,731,987 34,537,509 10,385,134
------------- ------------- ------------- ------------ ------------- ------------ -----------
END OF YEAR $ 360,741,488 $ 117,955,310 $ 72,091,166 $ 77,688,259 $ 28,681,377 $ 37,100,440 $ 9,786,804
============= ============= ============= ============ ============= ============ ===========
----------------------------
MONEY
MARKET UNALLOCATED
FUND TOTAL ESOP TOTAL
------------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends
Common Stock $ 28,742,113 $ 20,366,903 $ 49,109,016
Mutual Funds 15,307,317 15,307,317
Interest $ 1,893,031 2,125,600 21,874 2,147,474
NET APPRECIATION IN FAIR
VALUE OF INVESTMENTS (12,529,631) (23,456,686) (35,986,317)
------------- ------------- ------------- ------------
Total 1,893,031 33,645,399 (3,067,909) 30,577,490
------------- ------------- ------------- ------------
CONTRIBUTIONS
Participants 2,394,011 32,732,740 32,732,740
Employers
Allocations of
ESOP Stock 15,755,612 (15,755,612)
Cash 89,323 1,132,129 1,132,129
ESOP Contributions 15,529,316 15,529,316
------------- ------------- ------------- ------------
Total 2,483,334 49,620,481 (226,296) 49,394,185
------------- ------------- ------------- ------------
INTEREST ON PARTICIPANT
LOANS 238,940 3,017,426 3,017,426
------------- ------------- ------------- ------------
FUND TRANSFERS (1,245,852)
------------- ------------- ------------- ------------
ADMINISTRATIVE EXPENSES ( 13,335) (186,262) (186,262)
------------- ------------- ------------- ------------
BENEFIT PAYMENTS (7,457,934) (57,210,723) (57,210,723)
------------- ------------- ------------- ------------
INTEREST ON ESOP LOANS (27,124,320) (27,124,320)
------------- ------------- ------------- ------------
CHANGE IN NET ASSETS
AVAILABLE FOR BENEFITS (4,101,816) 28,886,321 (30,418,525) (1,532,204)
------------- ------------- ------------- ------------
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 42,177,636 713,234,343 67,569,767 780,804,110
------------- ------------- ------------- ------------
END OF YEAR $ 38,075,820 $ 742,120,664 $ 27,151,242 $779,271,906
============= ============= ============= ============
</TABLE>
See notes to financial statements.
4
<PAGE>
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
PARTICIPANT INVESTMENT FUNDS
------------------------------------------------------------------------------------------------------
HI CAPITAL GROWTH &
COMMON APPRECIATION INCOME INTERNATIONAL
STOCK ALLOCATED FUND EQUITY EQUITY EQUITY BALANCED
FUND ESOP B FUND FUND FUND FUND
------------- ------------- ------------- ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends
Common Stock $ 22,001,152 $ 6,106,421
Mutual Funds $ 1,157,831 $ 4,294,479 $ 4,068,670 $ 507,517 $ 946,416
Interest 319,998 57,699 563,438 130,628 2,998 1,287 440,008
NET APPRECIATION IN FAIR
VALUE OF INVESTMENTS 94,336,721 23,939,205 15,816,337 1,301,256 1,036,494 1,056,145 296,077
------------- ------------- ------------- ------------- ------------ ------------- ------------
Total 116,657,871 30,103,325 17,537,606 5,726,363 5,108,162 1,564,949 1,682,501
------------- ------------- ------------- ------------- ------------ ------------- ------------
CONTRIBUTIONS
Participants 14,041,387 8,691,957 3,310,813 3,328,790 1,537,225 1,791,436
Employers
Allocations of
ESOP Stock 19,239,974
Cash 744,344
ESOP Contributions
------------- ------------- ------------- ------------- ------------ ------------- ------------
Total 14,041,387 19,984,318 8,691,957 3,310,813 3,328,790 1,537,225 1,791,436
------------- ------------- ------------- ------------- ------------ ------------- ------------
INTEREST ON PARTICIPANT
LOANS 949,407 508,903 211,197 205,982 105,366 115,570
------------- ------------- ------------- ------------- ------------ ------------- ------------
FUND TRANSFERS (14,533,248) (85,216) (154,680,919) 48,126,466 51,619,764 20,038,351 32,125,594
------------- ------------- ------------- ------------- ------------ ------------- ------------
ADMINISTRATIVE EXPENSES (44,938) (13,764) (74,689) (12,934) (11,419) (4,844) (7,474)
------------- ------------- ------------- ------------- ------------ ------------- ------------
BENEFIT PAYMENTS (29,152,366) (5,491,844) (7,304,455) (1,350,712) (1,518,423) (509,060) (1,170,118)
------------- ------------- ------------- ------------- ------------ ------------- ------------
INTEREST ON ESOP LOANS
------------- ------------- ------------- ------------- ------------ ------------- ------------
CHANGE IN NET ASSETS
AVAILABLE FOR BENEFITS 87,918,113 44,496,819 (135,321,597) 56,011,193 58,732,856 22,731,987 34,537,509
------------- ------------- ------------- ------------- ------------ ------------- ------------
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 291,866,036 64,377,060 135,321,597
------------- ------------- ------------- ------------- ------------ ------------- ------------
END OF YEAR $ 379,784,149 $ 108,873,879 $ 0 $ 56,011,193 $ 58,732,856 $ 22,731,987 $ 34,537,509
============= ============= ============= ============= ============ ============= ============
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------
FIXED MONEY
INCOME MARKET UNALLOCATED TOTAL
FUND FUND TOTAL ESOP
------------- ------------- ------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends
Common Stock $ 28,107,573 $ 22,128,830 $ 50,236,403
Mutual Funds $ 10,974,913 $ 10,974,913
Interest $ 832,477 $ 1,871,522 4,220,055 52,153 4,272,208
NET APPRECIATION IN FAIR
VALUE OF INVESTMENTS 1,288,941 139,071,176 95,978,488 235,049,664
------------- ------------- ------------- ------------- ------------
Total 2,121,418 1,871,522 182,373,717 118,159,471 300,533,188
------------- ------------- ------------- ------------- ------------
CONTRIBUTIONS
Participants 1,474,208 3,257,851 37,433,677 37,433,667
Employers
Allocations of
ESOP Stock 19,239,974 (19,239,974)
Cash 744,344 744,344
ESOP Contributions 28,616,710 28,616,710
------------- ------------- ------------- ------------- ------------
Total 14,474,208 3,257,851 57,417,985 9,376,736 66,794,721
------------- ------------- ------------- ------------- ------------
INTEREST ON PARTICIPANT
LOANS 78,162 233,222 2,407,809 2,407,809
------------- ------------- ------------- ------------- ------------
FUND TRANSFERS (8,134,503) 25,523,711
------------- ------------- ------------- ------------- ------------
ADMINISTRATIVE EXPENSES (36,787) (23,523) (230,372) (230,372)
------------- ------------- ------------- ------------- ------------
BENEFIT PAYMENTS (1,766,587) (8,494,328) (56,757,893) (56,757,983)
------------- ------------- ------------- ------------- ------------
INTEREST ON ESOP LOANS (29,469,367) (29,469,367)
------------- ------------- ------------- ------------- ------------
CHANGE IN NET ASSETS
AVAILABLE FOR BENEFITS (6,264,089) 22,368,455 185,211,246 98,066,840 283,278,086
------------- ------------- ------------- ------------- ------------
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 16,649,223 19,809,181 528,023,097 (30,497,073) 497,526,024
------------- ------------- ------------- ------------- ------------
END OF YEAR $ 10,385,134 $ 42,177,636 $ 713,234,343 $ 67,569,767 $780,804,110
============= ============= ============= ============= ============
</TABLE>
See notes to financial statements.
5
<PAGE>
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
----------------------------------------------
1. ACCOUNTING POLICIES
In accordance with the provisions of the Houston Industries Incorporated
Savings Plan (Plan), the financial records of the Plan are generally kept and
the valuations of accounts of participating employees (Participants) are
determined on the accrual basis. Prior to July 1, 1995, the financial records of
the Plan were generally kept and the valuations of accounts of Participants were
determined on the cash basis.
The Plan recognizes net appreciation or depreciation in the fair value of
its investments. Investments are reflected at fair value in the financial
statements. Fair value for securities listed on a national exchange is
principally determined using the closing price on the New York Stock Exchange.
Fair value for mutual funds is determined using net asset value.
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions that affect
the reported amounts as well as certain disclosures. The Plan's financial
statements include amounts that are based on management's best estimates and
judgments. Actual results could differ from those estimates.
2. SUMMARY OF THE PLAN
The Plan was amended and restated effective July 1, 1995 to provide for (1)
the consolidation and merger of the Trust and the ESOP Trust (each as
hereinafter defined) into one trust, (2) the daily valuations of Participants'
accounts, (3) the addition of new investment funds and (4) certain other
changes.
Investment Program
- ------------------
The Plan has seven investment funds (Funds) (four investment funds prior to
July 1, 1995), as follows:
HI COMMON STOCK FUND (FORMERLY FUND A): Invested primarily in shares of common
stock of Houston Industries Incorporated (Company).
FUND B (ELIMINATED EFFECTIVE JULY 1, 1995): Invested and reinvested in, directly
or indirectly through collective investment media such as mutual funds, common,
collective, group or commingled trusts that invested primarily in equity
securities and/or real estate.
CAPITAL APPRECIATION EQUITY FUND (EFFECTIVE JULY 1, 1995): Invested in a pool of
stock mutual funds that have a goal of long-term growth with little emphasis on
current income. The mutual funds buy stocks of rapidly growing companies or
companies with potential for exceptional growth including small company and
international stocks.
GROWTH AND INCOME EQUITY FUND (EFFECTIVE JULY 1, 1995): Invested in a pool of
stock mutual funds that have a goal of long-term growth and current income. The
mutual funds buy stocks of growing companies and companies that have a history
of paying dividends.
INTERNATIONAL EQUITY FUND (EFFECTIVE JULY 1, 1995): Invested in a pool of
international stock mutual funds that have a goal of long-term growth with
little emphasis on current income. The mutual funds buy stocks of growing and
established companies that have their principal business activities and
interests outside of the United States and which show the potential for growth.
BALANCED FUND (EFFECTIVE JULY 1, 1995): Invested in both stock and bond mutual
funds. This Fund uses a bond mutual fund investing in high-quality bonds and
stock mutual funds investing in a wide variety of companies.
FIXED INCOME FUND (FORMERLY FUND C): Invested in a fixed income mutual fund. The
mutual fund invests in short-term, high-quality government and corporate bonds
and other fixed income securities. Prior to the
6
<PAGE>
conversion to daily valuations, Fund C was invested in fixed income securities
and was actively managed by an investment manager.
MONEY MARKET FUND (FORMERLY FUND D): Invested in a money market fund. The money
market fund invests in high-quality government and corporate fixed income
securities with maturities of less than one year.
Pending the acquisition of an investment in an orderly manner for the
Funds, the Trustee (as hereinafter defined) may temporarily hold funds
uninvested or in short-term investments.
The assets of the Plan are held in trust by The Northern Trust Company
(Trustee). Prior to May 1, 1995, the assets of the Plan were held in trust by
Texas Commerce Bank National Association (Prior Trustee) and State Street Bank
and Trust Company (Prior ESOP Trustee). The Benefits Committee (Committee),
appointed by the Board of Directors of the Company, as the administrator of the
Plan, has selected the investments for each of the Funds. Prior to July 1, 1995,
the Committee had appointed an investment manager to manage the assets of Fund
C. The Committee has also retained an independent investment consultant to
provide investment advice with respect to the Funds. The fees charged by the
Trustees, the investment manager, and the consultant are paid by the Trustee out
of the Funds.
A Participant has the right to direct the Trustee to invest his
contributions, but not matching contributions made by the employer (Employer
Contributions), in 1% increments in any or all of the Funds. Prior to July 1,
1995, a Participant had the right to direct the Trustee or Prior Trustee to
invest his contributions in 10% increments in any or all of the four Funds that
were available prior to July 1, 1995.
All Employer Contributions to the Plan were invested in the ESOP (as
hereinafter defined).
Employee Stock Ownership Plan
- -----------------------------
The employee stock ownership component (ESOP) of the Plan is a funding
mechanism for a portion of the Employer Contributions to the Plan. In connection
with the ESOP, the Company was party to an ESOP Trust Agreement between the
Company and the Prior ESOP Trustee. The Prior ESOP Trustee purchased shares of
the Company's common stock in open market transactions with funds provided by
loans (Loans) from the Company. The Prior ESOP Trustee completed the purchases
of shares of the Company's common stock in December 1991 after purchasing
18,762,184 shares at a cost of approximately $350 million. At December 31, 1996
and 1995, the balance of the Loans was approximately $269 million and $285
million, respectively. The Loans bear interest at a fixed rate of 9.783%. The
Loans are expected to be repaid over a period of up to twenty years. The Trustee
has made approximately $81 million of principal prepayments as of December 31,
1996. Consequently, no additional principal repayments are required until 2005.
The Company makes periodic cash contributions to the unallocated ESOP (ESOP
Contributions) portion of the Trust (as hereinafter defined). The ESOP
Contributions, together with the earnings received by the ESOP Trustee, are used
to pay principal and interest on the Loans. As debt service payments on the
Loans are made, the Company releases shares of common stock from the pledge
securing the Loans and such shares are available for allocation to Participants'
accounts as Employer Contributions. All released shares must be allocated to
Participants' accounts at year-end. No allocated shares serve as collateral for
the Loans. In addition to the ESOP Contributions, the Company may elect to make
Employer Contributions to the Allocated ESOP (as hereinafter defined) in the
form of cash which may be used to purchase shares of the Company's common stock
in the open market. Dividend income received on shares of the Company's common
stock that were purchased in the open market is not available for debt service
payments.
That portion of the ESOP which has been allocated to Participants
(Allocated ESOP) as Employer Contributions and that portion of the ESOP which
has not been allocated to Participants (Unallocated ESOP) are presented
separately in the financial statements.
Funding
- -------
Contributions to the Plan are made by Participants and by the Company and
each subsidiary of the Company that has adopted the Plan (Employers). Each
Participant may contribute to the Plan annually an amount equal to any whole
percentage up to and including 6% of his total compensation. This amount,
7
<PAGE>
referred to as the Participant's "Basic Contributions", could be made up of Pre-
tax and After-tax Contributions (as hereinafter defined), provided that the
total amount contributed was less than or equal to 6% of the Participant's
compensation. Participants employed by KBLCOM Incorporated (KBLCOM) or one of
its subsidiaries (KBLCOM Participants) were not permitted to make After-tax
Contributions. Employer Contributions are in an amount equal to 70% of
Participants' Basic Contributions.
Each Participant, except KBLCOM Participants, may make excess contributions
annually to the Plan in an amount equal to any whole percentage up to and
including 10% of his total compensation. This amount, referred to as the
Participant's "Excess Contributions", may be made up of Pre-tax and After-tax
Contributions, provided that the total amount contributed is less than or equal
to 10% of the Participant's compensation. KBLCOM Participants' Excess
Contributions had to be Pre-tax Contributions and were limited to an amount
equal to any whole percentage up to and including 4% of such KBLCOM
Participant's total compensation. Employers do not match excess contributions.
Participants may make their contributions to the Plan through (i) payroll
deductions (After-tax Contributions), (ii) salary deferral (Pre-tax
Contributions) or (iii) a combination of After-Tax and Pre-tax Contributions.
KBLCOM Participants were eligible to make their contributions only through Pre-
tax Contributions.
Pre-tax Contributions made to the Plan by salary deferral decrease a
Participant's income for federal income tax purposes by the amount of such
Participant's Pre-tax Contributions. Pre-tax Contributions are, however, subject
to Federal Insurance Contributions Act withholding tax.
The maximum amount that a taxpayer may elect to defer as a Pre-tax
Contribution for any taxable year under all cash or deferred arrangements (such
as the Plan) in which the taxpayer participates was limited to $9,500 in 1996
and $9,240 in 1995. The limit for 1997 is $9,500, to be adjusted annually
thereafter for inflation. If the total amount of Pre-tax Contributions exceeds
the maximum limit during any calendar year, such excess will be included in the
taxpayer's gross income for the year to which the deferrals relate, and will be
returned to the Participant, plus any income or minus any loss allocable
thereto, by April 15 of the following year.
Participation
- -------------
Any eligible employee of an Employer may participate in the Plan as soon as
is practicable after employment commences. Prior to July 1, 1995, any eligible
employee of an Employer could participate in the Plan beginning on any January
1, April 1, July 1 or October 1. Ineligible employees include persons not
regularly and principally employed by an Employer and leased employees. Former
Participants who are reemployed by an Employer may recommence participation in
the Plan as soon as practicable after reemployment, their vesting service will
be reinstated, and any portion of their interest in the Employer Contributions
that was forfeited will be reinstated in accordance with the terms of the Plan.
Distributions and Forfeitures
- -----------------------------
A terminated Participant or the beneficiary of a deceased Participant is
entitled to a distribution of the value of the Participant's entire account in
case of death, disability, or retirement at or after the later of (i) the
Participant's attainment of age 65 or (ii) the fifth anniversary of the
Participant's commencement of participation in the Plan. In case of termination
of service for other reasons, a Participant is entitled to a distribution of the
entire value of his contribution account plus the vested portion of his Employer
Contribution account. Vesting is determined by vesting service years in
accordance with the following schedule:
Vesting Service Vested
Years* Percentage
--------------- ----------
Less than two............. 0
Two but less than three... 20
Three but less than four.. 40
Four but less than five... 60
Five but less than six.... 80
Six or more............... 100
_________________
*Generally, a vesting service year is each Plan year during
which an employee completed at least 1,000 hours of service.
8
<PAGE>
Any portion of the value of Employer Contributions not vested will be
forfeited. The amount forfeited by a Participant is applied to reduce the
respective Employer's subsequent contribution to the Plan.
A terminated Participant receives a lump sum final distribution from the
Plan upon written request no later than the end of the year in which the
terminated Participant attains the age of 65, or if no request is received, an
automatic distribution will be made to the terminated Participant and mailed to
his last known address. Immediate lump sum distributions are made for accounts
which do not exceed $3,500.
Withdrawals and Loans
- ---------------------
A Participant may make in-service withdrawals from amounts attributable to
his After-tax Contributions. A KBLCOM Participant who had After-tax
Contributions attributable to service before becoming a KBLCOM Participant could
make an in-service withdrawal from such After-tax Contributions. A Participant
with less than five years of service who withdraws Basic After-tax Contributions
will be suspended from Plan participation for six months.
A Participant may borrow against amounts attributable to his Pre-tax
Contributions. The maximum amount that a Participant may borrow from his Pre-tax
Contribution account is the lesser of (i) $50,000, reduced by the excess, if
any, of the highest outstanding balance of loans to the Participant from all
plans maintained by the Company or an affiliated entity during the one-year
period ending on the day before the date on which such loan is made over the
outstanding balance of loans from the Plan on the date on which such loan is
made, (ii) 50% of the value of the Participant's vested account balance under
the Plan or (iii) 100% of the value of the Participant's Pre-tax Contribution
account. The loans are to be secured by the pledge of a portion of the
Participant's right, title and value of the Participant's vested account balance
under the Plan as determined immediately after the loan is made. Loans may be
repaid over a period of up to five years, except loans made before January 1,
1994 must to be repaid over a period of up to four years. No loan will be made
for a sum of less than $500.
Diversification of Investments
- ------------------------------
A Participant who is 55 years of age or older as of any December 31 and who
has participated in the Plan for at least ten years is qualified to diversify,
in any subsequent calendar year, the investments in his ESOP account and his
Employer Contribution account by transferring up to 25% of the sum of the
balances of those accounts (less any amount previously transferred) to any of
the other Funds. After five years of eligibility to make such transfers, the
maximum percentage increases to 50% (less any amount previously transferred). A
qualified Participant must make this election in the first 90 days of any
calendar year following qualification to diversify. The transfer will be
effective on the last business day in March. Second or subsequent elections will
cause transfers only to the extent the permissible election exceeds amounts
previously transferred.
Termination of the Plan
- -----------------------
The Company may terminate the Plan at any time and must give written notice
to the Trustee. In the event of termination of the Plan, the assets held by the
Trustee under the Plan will be valued and each Participant will become fully
vested and entitled to distributions respecting his account.
3. FEDERAL INCOME TAXES
No provision for federal income taxes has been made in the financial
statements of the Plan. The Internal Revenue Service (IRS) determined and
informed the Company by a letter dated December 3, 1994 that the Plan, as
amended and restated effective January 1, 1994 (Prior Plan), was qualified and
the trust fund (Trust) established under the Prior Plan was tax-exempt under the
appropriate sections of the Internal Revenue Code of 1986, as amended (Code).
Although the Plan was amended and restated subsequent to that date, the
Committee and the Company's counsel believe that the Plan was designed and
operated in compliance with the requirements of the Code. As a result, the
Participant's Pre-tax Contributions, up to a specified maximum amount each
calendar year, and the Employer Contributions to the Trust on behalf of a
Participant are not currently taxable to a Participant when made, and income
from any source accruing to a Participant's account is not taxable when realized
by the Trust. The After-tax Contributions made by a Participant will not be
deductible by the Participant. The continued status of the Trust as a tax-exempt
trust and the Plan as a qualified plan are contingent upon the continuing
operation of the Trust and the Plan in accordance with applicable provisions of
the Code.
9
<PAGE>
4. RELATED PARTY TRANSACTIONS
During 1996, the Trustee purchased 1,000,074 shares (valued at $22,343,873)
of the Company's common stock in the open market and 136,363 shares (valued at
$2,999,986) of the Company's common stock from the Allocated ESOP for the Common
Stock Fund.
During 1996, the Trustee sold in the open market 677,626 shares of the
Company's common stock valued at $15,396,601 (cost, $11,255,910) from the Common
Stock Fund and the Allocated ESOP Fund.
During 1995, the Trustee, the Prior Trustee and the Prior ESOP Trustee
purchased in the open market shares of the Company's common stock for the Common
Stock Fund (Fund A) and the Allocated ESOP. The number of shares of the
Company's common stock purchased and the related cost are shown below:
Common Stock Fund
(Fund A) Allocated ESOP
-------------------- --------------------
Shares Cost Shares Cost
------ ---- ------ ----
Open Market Purchases 874,236 $19,433,689 9,846 $ 199,962
During 1995, the Trustee purchased 80,000 shares (valued at $1,801,938) of
the Company's common stock from the Allocated ESOP for the Common Stock Fund.
During 1995, the Trustee and the Prior ESOP Trustee sold in the open market
1,590,590 shares of the Company's common stock valued at $34,022,563 (cost,
$25,254,640).
During 1996, the Trustee distributed 318,751 shares of the Company's common
stock (valued at $7,386,918). During 1995, the Trustee, the Prior Trustee and
the Prior ESOP Trustee distributed 182,354 shares of the Company's common stock
(valued at $3,668,102).
As of December 31, 1996, an aggregate of 33,171,359 shares of the Company's
common stock was held by the Plan, including shares held in the Unallocated
ESOP. As of December 31, 1995, an aggregate of 33,167,662 shares of the
Company's common stock was held by the Plan, including shares held in the
Unallocated ESOP. These shares represented 12.62% and 12.62%, respectively, of
the Company's common stock outstanding at December 31, 1996 and December 31,
1995.
During 1996 and 1995, the Plan and the ESOP purchased and sold units of
short-term investment funds managed by the Trustee, the Prior Trustee and the
Prior ESOP Trustee as temporary investments, as shown below:
1996 1995
------------- -------------
Plan & ESOP Plan & ESOP
------------- -------------
Purchases $ 59,289,695 $ 404,485,259
Sales 68,208,274 381,417,605
5. BENEFITS PAYABLE
As of December 31, 1996 and 1995, the Plan's net assets available for
benefits did not include any amounts due to Participants who had withdrawn from
participation in the Plan.
During 1995, the Plan experienced an increase in the number of
distributions due to the sale of KBLCOM and various severance plans offered to
certain employees of the Company.
10
<PAGE>
6. SALE OF KBLCOM INCORPORATED
In January 1995, the Company agreed to sell KBLCOM to Time Warner Inc.
(Time Warner). The sale closed in July 1995. KBLCOM Participants continued their
participation in the Plan until June 30, 1995. At such time the KBLCOM
Participants terminated service and their accounts became fully vested and
nonforfeitable. Time Warner did not have a qualified plan that accepts roll-over
contributions. Consequently, the accounts of the KBLCOM Participants remained
in the Plan and were or will be distributed pursuant to the provisions of the
Plan as they relate to any terminated Participant. In June 1995, approximately
1,100 KBLCOM Participants elected to receive distributions of their accounts
under the Plan. Approximately 140 KBLCOM Participants remained in the Plan.
Neither the Company nor the Committee is able to predict when such benefits will
be distributed to such remaining KBLCOM Participants.
11
<PAGE>
Item 27a - Schedule of Assets Held for Investment Purposes;
EIN: 74-1885573; PN: 015
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
SUPPLEMENTAL SCHEDULE OF INVESTMENTS
DECEMBER 31, 1996
CURRENT
COST VALUE
---- --------
HI COMMON STOCK FUND
- --------------------
Common Stock
- ------------
*Houston Industries (14,759,529 shares) $241,912,134 $333,934,344
Cash Equivalents
- ----------------
*Northern Trust Collective Short-Term
Investment Fund ($2,355,261 par value) 2,355,261 2,355,261
------------ ------------
TOTAL HI COMMON STOCK FUND INVESTMENTS 244,267,395 336,289,605
------------ ------------
ALLOCATED ESOP
- --------------
Common Stock
- ------------
*Houston Industries (5,051,146 shares) 94,657,409 114,282,178
------------ ------------
Cash Equivalents
- ----------------
*Northern Trust Collective Short-Term
Investment Fund ($490,550 par value) 490,550 490,550
------------ ------------
TOTAL ALLOCATED ESOP INVESTMENTS 95,147,959 114,772,728
------------ ------------
CAPITAL APPRECIATION EQUITY FUND
- --------------------------------
Mutual Funds
- ------------
Acorn Fund (1,371,643 shares) 17,565,491 20,629,516
AIM Weingarten Fund Institutional Class
(1,125,717 shares) 20,594,785 20,837,030
Janus Fund (994,831 shares) 24,354,865 24,323,623
------------ ------------
TOTAL CAPITAL APPRECIATION EQUITY
FUND INVESTMENTS 62,515,141 65,790,169
------------ ------------
GROWTH AND INCOME EQUITY FUND
- -----------------------------
Mutual Funds
- ------------
Davis New York Venture Fund Class A
(1,415,363 shares) 18,237,577 24,768,851
Dodge & Cox Stock Fund (325,685 shares) 22,891,555 25,992,905
Vanguard Windsor Fund (1,462,087 shares) 20,862,154 24,256,024
------------ ------------
TOTAL GROWTH & INCOME EQUITY
FUND INVESTMENTS 61,991,286 75,017,780
------------ ------------
INTERNATIONAL EQUITY FUND
- -------------------------
Mutual Funds
- ------------
American Funds EuroPacific Growth Fund
(343,101 shares) 7,822,663 8,934,363
Lazard International Equity Portfolio
(607,991 shares) 7,843,366 8,280,838
Warburg Pincus International Equity Fund
Institutional Class (547,042 shares) 8,512,520 8,944,141
------------ ------------
TOTAL INTERNATIONAL EQUITY
FUND INVESTMENTS 24,178,549 26,159,342
============ ============
12
<PAGE>
Item 27a - Schedule of Assets Held for Investment Purposes;
EIN: 74-1885573; PN: 015
CURRENT
COST VALUE
---- --------
BALANCED FUND
- -------------
Mutual Funds
- ------------
Acorn Fund (316,194 shares) 4,478,941 4,755,560
American Funds EuroPacific Growth
Fund (233,037 shares) 5,418,713 6,068,284
Davis New York Venture Fund Class A
(281,029 shares) 4,180,525 4,918,002
Neuberger & Berman Guardian Fund
(106,092 shares) 2,605,085 2,719,134
Vanguard Fixed Income Securities Fund
Short-Term Corporate Portfolio
(1,607,846 shares) 17,332,612 17,284,344
------------ --------------
TOTAL BALANCED FUND INVESTMENTS 34,015,876 35,745,324
------------ --------------
FIXED INCOME FUND
- -----------------
Mutual Funds
- ------------
Vanguard Fixed Income Securities Fund
Short-Term Corporate Portfolio
(731,350 shares) 7,868,884 7,862,009
------------ --------------
TOTAL FIXED INCOME FUND INVESTMENTS 7,868,884 7,862,009
------------ --------------
MONEY MARKET FUND
- -----------------
Cash Equivalents
- ----------------
*Northern Trust Collective Short-Term
Investment Fund ($33,065,117 par value) 33,065,117 33,065,117
------------ --------------
TOTAL MONEY MARKET FUND INVESTMENTS 33,065,117 33,065,117
------------ --------------
TOTAL PARTICIPANT INVESTMENTS 563,050,207 694,702,074
------------ --------------
UNALLOCATED ESOP
- ----------------
Common Stock
- ------------
*Houston Industries (13,360,684 shares) 249,306,274 302,285,476
------------ --------------
Cash Equivalents
- ----------------
*Northern Trust Collective Short-Term
Investment Fund ($3,542,777 par value) 3,542,777 3,542,777
------------ --------------
TOTAL UNALLOCATED ESOP INVESTMENTS 252,849,051 305,828,253
------------ --------------
TOTAL SAVINGS PLAN INVESTMENTS $815,899,258 $1,000,530,327
============ ==============
*PARTICIPANT LOANS, 6.00% to 10.00%,
maturing 1997 through 2001 $ 37,306,740 $ 37,306,740
============ ==============
*Party-in-Interest
13
<PAGE>
Item 27a - Schedule of Assets Held for Investment Purposes; EIN: 74-1885573;
PN: 015
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
SUPPLEMENTAL SCHEDULE OF ASSETS PURCHASED AND SOLD
FOR THE YEAR ENDED DECEMBER 31, 1996
- --------------------------------------------------------------------------------
SHARES/ SALES
DESCRIPTION PAR VALUE COST PROCEEDS
- --------------------------------------------------------------------------------
NONE
14
<PAGE>
Item 27d - Schedule of Reportable Transactions; EIN: 74-1885573; PN: 015
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
============================================
<TABLE>
<CAPTION>
SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CURRENT VALUE
DESCRIPTION PURCHASE SELLING COST OF ON TRANSACTION EXPENSE
PRICE PRICE ASSET DATE INCURRED NET GAIN
- ------------------------------------------------------------------------------------------------------------------------------------
SINGLE TRANSACTIONS
- -------------------
None
SERIES OF TRANSACTIONS
- ----------------------
*The Northern Trust Company Collective
Short-Term Investment Fund:
(113 Purchases) $59,289,695 $59,289,695
(145 Sales) $68,208,274 $68,208,274 68,208,274
- -----------------------------
*Party-in-Interest
</TABLE>
15
<PAGE>
SIGNATURE
=========
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the Plan) have duly caused this
annual report to be signed on its behalf by the undersigned thereunto duly
authorized.
HOUSTON INDUSTRIES INCORPORATED SAVINGS PLAN
By /s/ D. D. Sykora
------------------------------------------
(D. D. Sykora, Chairman of the
Benefits Committee of
Houston Industries Incorporated,
Plan Administrator)
June 27, 1997
16
<PAGE>
Index to Exhibits
Exhibit
No. Description
- ------- -----------
1 Independent Auditors' Consent
2 Houston Industries Incorporated Savings Plan, as Amended and Restated
Effective as of January 1, 1994 (incorporated by reference to Exhibit
4.5 to Post-Effective Amendment No. 1 to Form S-8 of the Company, File
No. 33-38344)
3 First Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective January 1, 1994, effective as of April
6, 1994 (incorporated by reference to Exhibit 99(d) to the Quarterly
Report on Form 10-Q of the Company for the quarter ended March 31,
1994, File No. 1-7629)
4 Second Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective January 1, 1994, effective January 1,
1994 (incorporated by reference to Exhibit 99(f) to the Quarterly
Report on Form 10-Q of the Company for the quarter ended September 30,
1994, File No. 1-7629)
5 Third Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective January 1, 1994, effective January 1,
1994 (incorporated by reference to Exhibit 6 to the Plan's Annual
Report on Form 11-K for the fiscal year ended December 31, 1994, File
No. 1-7629)
6 Fourth Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective January 1, 1994, effective January 1,
1995 and May 1, 1995 (incorporated by reference to Exhibit 7 to the
Plan's Annual Report on Form 11-K for the fiscal year ended December
31, 1994, File No. 1-7629)
7 Houston Industries Incorporated Savings Plan, as Amended and Restated
Effective as of July 1, 1995 (incorporated by reference to Exhibit
99(c) to the Quarterly Report on Form 10-Q of the Company for the
quarter ended March 31, 1995, File No. 1-7629)
8 Houston Industries Incorporated Master Savings Trust, as Amended and
Restated Effective as of January 1, 1994, between the Company and
Texas Commerce Bank National Association (incorporated by reference to
Exhibit 10 to the Quarterly Report on Form 10-Q of the Company for the
quarter ended March 31, 1994, File No. 1-7629)
9 First Amendment to Houston Industries Incorporated Master Savings
Trust effective as of May 1, 1995 (incorporated by reference to
Exhibit 10(a) to the Quarterly Report on Form 10-Q of the Company for
the quarter ended March 31, 1995, File No. 1-7629)
10 Appointment of Successor Trustee under the Houston Industries
Incorporated Master Savings Trust dated as of May 1, 1995
(incorporated by reference to Exhibit 10 to the Plan's Annual Report
on Form 11-K for the fiscal year ended December 31, 1995, File No. 1-
7629)
11 Termination of Houston Industries Incorporated Savings Plan and Trust
Agreement as to KBLCOM Incorporated effective as of June 30, 1995
(incorporated by reference to Exhibit 10(a) to the Quarterly Report on
Form 10-Q of the Company for the quarter ended September 30, 1995,
File No. 1-7629)
12 ESOP Trust Agreement between Houston Industries Incorporated and State
Street Bank and Trust Company, as ESOP Trustee, dated October 5, 1990
(incorporated by reference to Exhibit 10(j)(2) to the Annual Report of
the Company on Form 10-K for the year ended December 31, 1990, File
No. 1-7629)
17
<PAGE>
Index to Exhibits-continued
Exhibit
No. Description
- ------- -----------
13 First Amendment to ESOP Trust Agreement between Houston Industries
Incorporated and State Street Bank and Trust Company, as ESOP Trustee,
dated October 5, 1990 (incorporated by reference to Exhibit 10(b) to
the Quarterly Report on Form 10-Q of the Company for the quarter ended
March 31, 1995, File No. 1-7629)
14 Appointment of Successor Trustee under the Savings Plan of Houston
Industries Incorporated ESOP Trust Agreement dated as of May 1, 1995
(incorporated by reference to Exhibit 14 to the Plan's Annual Report
on Form 11-K for the fiscal year ended December 31, 1995, File No. 1-
7629)
15 Houston Industries Incorporated Savings Trust, as Amended and Restated
as of July 1, 1995, between the Company and The Northern Trust Company
(incorporated by reference to Exhibit 10(s)(4) to the Annual Report on
Form 10-K of the Company for the year ended December 31, 1995, File
No. 1-7629)
16 First Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective as of July 1, 1995, effective June 30,
1995 (incorporated by reference to Exhibit 99(g) to the Company's
Report on Form 10-Q for the quarter ended June 30, 1995)
17 Second Amendment to Houston Industries Incorporated Savings Plan, as
Amended and Restated Effective as of July 1, 1995, effective August 1,
1996 (incorporated by reference to Exhibit 99(e) to the Company's
Report on Form 10-Q for the quarter ended June 30, 1996)
18
<PAGE>
EXHIBIT 1
INDEPENDENT AUDITORS' CONSENT
=============================
We hereby consent to the incorporation by reference in the Registration
Statement of Houston Industries Incorporated on Form S-8 (File No. 33-55391) of
our report dated June 24, 1997 appearing in the Annual Report on Form 11-K of
the Houston Industries Incorporated Savings Plan for the year ended December 31,
1996.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Houston, Texas
June 27, 1997
