<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
____________________
ENSERCH EXPLORATION, INC.
(Formerly New Enserch Exploration, Inc.)
(Name of Issuer)
Common Stock, $1.00 Par Value
(Title of class of securities)
29356V 10 0
(CUSIP Number)
____________________
M. G. Fortado
Vice President and Corporate Secretary
ENSERCH Corporation
300 S. St. Paul Street
Dallas, Texas 75201
(214) 651-8700
(Name, address and telephone number of person
authorized to receive notices and communications)
____________________
December 30, 1994
(Date of event which requires filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or
(4), check the following box:
-----
Check the following box if a fee is being paid with this Statement:
X
-----
<PAGE>
<PAGE>
CUSIP No. 29356V 10 0
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ENSERCH Corporation, 75-0399066
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) X
-----
(b)
-----
3. SEC USE ONLY
4. SOURCE OF FUNDS*
00
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7. SOLE VOTING POWER
36,555,365
8. SHARED VOTING POWER
67,219,963
9. SOLE DISPOSITIVE POWER
36,555,365
10. SHARED DISPOSITIVE POWER
67,219,963
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
103,775,328
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
X
-----
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
99.23%
14. TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
<PAGE>
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ENS Holdings Limited Partnership, 75-6469511
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) X
-----
(b)
-----
3. SEC USE ONLY
4. SOURCE OF FUNDS*
00
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7. SOLE VOTING POWER
53,366,434
8. SHARED VOTING POWER
9. SOLE DISPOSITIVE POWER
53,336,434
10. SHARED DISPOSITIVE POWER
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
53,336,434
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
X
-----
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
14. TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
<PAGE>
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Enserch Exploration Holdings, Inc., 75-2015938
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) X
-----
(b)
-----
3. SEC USE ONLY
4. SOURCE OF FUNDS*
00
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7. SOLE VOTING POWER
13,883,529
8. SHARED VOTING POWER
9. SOLE DISPOSITIVE POWER
13,883,529
10. SHARED DISPOSITIVE POWER
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
13,883,529
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
X
-----
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13.28%
14. TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
<PAGE>
SCHEDULE 13D STATEMENT
The information contained in this Schedule 13D Statement is
filed pursuant to Rule 13d-1(a) of Regulation 13D-G of the General
Rules and Regulations under the Securities Exchange Act of 1934, as
amended (the "1934 Act").
Item 1. Security and Issuer.
This Statement relates to the common stock, par value $1.00
per share (the "Common Stock"), of Enserch Exploration, Inc., a
Texas corporation (the "Company") organized in 1994 under the name
New Enserch Exploration, Inc, with its principal executive offices
at 4849 Greenville Avenue, Suite 1500, Dallas, Texas 75206-4186.
Item 2. Identity and Background.
A. Reporting Persons.
This Statement is being filed jointly by:
(i) ENSERCH Corporation, a Texas corporation
("EC");
(ii) ENS Holdings Limited Partnership, a Texas
limited partnership, as trustee (the
"Trustee") of the ENS Holdings Trust, a Texas
trust (the "Trust") of which EC is the
beneficiary (ENS Holdings I, Inc., a Texas
corporation, is the general partner (the
"Trustee GP") of the Trustee and is a wholly-
owned subsidiary of EC; and the sole limited
partner of the Trustee is ENS Holdings II,
Inc., a Texas corporation which is a wholly-
owned subsidiary of EC); and
(iii) Enserch Exploration Holdings, Inc., a Delaware
corporation ("EEI") formerly named Enserch
Exploration, Inc. which is a wholly-owned
subsidiary of EC.
EEI and the Trustee are controlled and wholly-owned by EC and,
together with EC (collectively, the "Reporting Persons"), may be
deemed to comprise a "group" within the meaning of the 1934 Act.
EC and EEI are referred to herein collectively as the "Corporate
Reporting Persons."
The principal place of business of the Reporting Persons is at
300 S. St. Paul Street, Dallas, Texas 75201. EC is a an integrated
company focused primarily on natural gas. The other Reporting
Persons are controlled by EC and may be deemed to be part of its
business. EC's domestic oil and gas exploration and production
activities are conducted through the Company.
None of the Reporting Persons has, during the last five years,
been a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction which resulted in a judgment, decree
or final order against it enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such laws.
Each of the Reporting Persons is a United States Citizen.
B. Executive Officers and Directors of Corporate Reporting
Persons
Set forth on Schedule A hereto is information concerning the
name, residence or business address, citizenship and background of
each director and executive officer of each of the Corporate
Reporting Persons and the Trustee GP, which information is
incorporated herein by reference.
None of the directors or executive officers of any of the
Corporate Reporting Persons or the Trustee GP has been convicted,
during the last five years, in a criminal proceeding (excluding
traffic violations or similar misdemeanors).
None of the directors or executive officers of any of the
Corporate Reporting Persons or the Trustee GP has been, during the
last five years, a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction which resulted in a
judgment, decree or final order against such director or officer
enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
Each of the directors and executive officers of each of the
Corporate Reporting Persons and the Trustee GP is a United States
Citizen.
Item 3. Source and Amount of Funds or Other Consideration.
The Reporting Persons acquired their Common Stock in
connection with the reorganization on December 30, 1994, of Enserch
Exploration, Partners, Ltd., a Texas limited partnership ("EP"), as
contemplated by the Prospectus/Information Statement dated December
9, 1994 (the "Prospectus/Information Statement") which formed part
of the Company's registration statement on Form S-4 (file no. 33-
56792) under the Securities Act of 1933, as amended, and is
incorporated herein by this reference, and a subsequent
reorganization on December 31, 1994, of Enserch Processing
Partners, Ltd. ("EPPL"), a partnership wholly-owned by EC and its
subsidiaries (collectively, the "Reorganization"). For less than
24 hours during the course of the Reorganization, EPPL shared
beneficial ownership of 89,881,232 shares with EC.
Item 4. Purpose of Transaction.
The Reporting Persons acquired their Common Stock in
connection with the Reorganization whose purpose and effect was to
convert EP from a limited partnership into a corporation.
EC intends to control the Company and to conduct its domestic
oil and gas exploration activities through the Company. Each of
the Company's four directors, and each of its executive officers,
is a director or officer of EC or another of its subsidiaries.
Other than as set forth above or in the Prospectus/Information
Statement, EC does not have any definitive plans or proposals which
relate to or would result in:
(a) The acquisition by any person of additional securities of
the Company or the disposition of securities of the Company;
(b) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its
subsidiaries;
(c) A sale or transfer or a material amount of assets of the
Company or any of its subsidiaries;
(d) Any change in the present board of directors or
management of the Company, including any plans or proposals to
change the number or term of directors or to fill any existing
vacancies on the board;
(e) Any material change in the present capitalization or
dividend policy of the Company;
(f) Any other material change in the Company's business or
corporate structure;
(g) Changes in the Company's charter, bylaws or instruments
corresponding thereto or other actions which may impede the
acquisition of control of the Company by any person;
(h) Causing a class of securities of the Company to be
delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a
registered national securities association;
(i) A class of equity securities of the Company becoming
eligible for termination of registration pursuant to Section
12(g)(4) of the Securities Exchange Act of 1934; or
(j) Any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
As of December 31, 1994, EC may be deemed to beneficially own,
directly or indirectly, 103,775,328 shares of Common Stock,
constituting approximately 99.23% of the Common Stock outstanding,
which were acquired in the Reorganization. These shares are owned
by the Reporting Persons as follows:
<TABLE>
<CAPTION>
No. Shares (1) % of Class
<S> <C> <C>
EC 36,555,365 34.95%
Trustee (2) 53,336,434 51.00%
EEI 13,883,529 13.28%
----------- -----
103,775,328 99.23%
</TABLE>
______________
(1) EC has sole voting and dispositive power over 36,555,365
shares (34.95%) of the outstanding Common Stock and, by virtue
of its ownership of the securities of EEI, the Trustee and the
Trustee GP, may be deemed to share the voting and dispositive
power with respect to the 67,219,963 shares (64.28%) of the
outstanding Common Stock shown as owned by EEI and the Trust.
EC, therefore, may be deemed to own beneficially, directly or
indirectly, all of the 103,775,328 shares (99.23%) of the
outstanding Common Stock shown in the table.
(2) The Trustee has voting and dispositive power with respect to
the 53,336,434 shares (51.00%) of the outstanding Common Stock
owned by the Trust and may be deemed to beneficially own those
shares. EC has the power to revoke the Trust by giving not
less than 90 days' prior notice of revocation. Upon
termination of the Trust, the assets in the Trust (including
any shares of Common Stock in the Trust at that time) would be
distributed to EC. Actions of the Trustee are effected by the
Trustee GP in its capacity as general partner of the Trustee.
_______________
The persons named in the table had the sole power to vote or
direct the vote and to dispose or direct the disposition of the
Common Stock indicated as being beneficially owned by such persons,
except as disclosed therein.
As of December 31, 1994, D. W. Biegler, an executive officer
and director of each of the Corporate Reporting Persons and the
Trustee GP, beneficially owned 1,000 shares of Common Stock. As of
such date none of the other directors or executive officers of any
of the Corporate Reporting Persons or the Trustee GP was known by
the Reporting Persons to own any shares of Common Stock. The
Reporting Persons disclaim beneficial ownership of the Common Stock
owned by Mr. Biegler.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of the Issuer.
EC intends to control the Company, to conduct its domestic oil
and gas exploration and production activities through the Company
and, as a result, to have numerous transactions and relationships
with the Company, as contemplated by the Prospectus/Information
Statement. For example, EC and its subsidiaries and affiliated
partnerships (the "EC Companies") will purchase and market natural
gas produced from the Company's properties. A number of
transactions and relationships between the Company and the EC
Companies are contemplated and specifically authorized by Article
Eleven of the Company's Restated Articles of Incorporation, which
is incorporated herein by this reference.
Except as disclosed above or in the Prospectus/Information
Statement, none of the Reporting Persons or the persons named in
Schedule A hereto has any contract, arrangement, understanding or
relationship with any person with respect to any securities of the
Company, including but not limited to transfer or voting of any
such securities, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
1. Trust Agreement dated December 31, 1994 among Trustee,
Enserch Processing Partners, Ltd., and EC (filed herewith).
2. Prospectus/Information Statement dated December 9, 1994
(filed as part of the Company's registration statement on Form S-4
(no. 33-56792) and incorporated herein by this reference).
3. Restated Articles of Incorporation of the Company filed
with the Secretary of State of Texas on December 30, 1994 (filed as
an exhibit to the Company's Form 8K Report dated January 6, 1995
and incorporated herein by this reference).
SIGNATURE
After reasonable inquiry and to the best of its knowledge and
belief, the undersigned certify that the information set forth in
this Schedule 13D Statement is true, complete and correct.
Dated: January 6, 1995
ENSERCH CORPORATION
By: /s/ J. W. Pinkerton
------------------------------
J. W. Pinkerton,
Vice President
ENS HOLDINGS LIMITED PARTNERSHIP, AS
TRUSTEE OF ENS HOLDINGS TRUST
By: ENS Holdings I, Inc., as General
Partner
By: /s/ J. W. Pinkerton
-------------------------------
Vice President
ENSERCH EXPLORATION HOLDINGS, INC.
By: /s/ J. W. Pinkerton
-------------------------------
Vice President
<PAGE>
<PAGE>
Schedule A
INFORMATION REGARDING DIRECTORS AND EXECUTIVE OFFICERS
ENSERCH CORPORATION ("EC")
Directors of EC
<TABLE>
<CAPTION>
Present Principal
Occupation or
Name Employment Business Address
- ---- ----------------- ----------------
<S> <C> <C>
D. W. Biegler Chairman and 300 S. St. Paul
President,Chief Dallas, TX 75201
Executive Officer
of ENSERCH Corporation
W. C. McCord Retired Chairman and One Energy Square
Chief Executive 4925 Greenville
Officer of ENSERCH Suite 1025
Corporation Dallas, TX 75206
Preston M. Geren, Private investments 619 Overton Park Bank
Jr. 4200 S. Hulen
Ft. Worth, TX 76109
W. Ray Wallace Chairman, President Trinity Industries,
and Chief Executive Inc.
Officer of Trinity 2525 Stemmons Frwy.
Industries, Inc. Dallas, TX 75356
William B. Boyd Retired Chairman of 15729 Carberry Ct. SE
the Board, President Ft. Meyers, FL 33912
and Chief Executive
Officer of American
Standard Inc.
B. A. Bridgewater, Chairman, President Brown Group, Inc.
Jr. and Chief Executive 8400 Maryland Avenue
Officer of Brown St. Louis, Missouri
Group, Inc. 63105
J. M. Haggar, Jr. Retired Chairman of Haggar Apparel Company
the Board of Haggar 6113 Lemmon Avenue
Apparel Company Dallas, TX 75209
L. E. Fouraker Retired Dean of 80 Fernwood
Harvard Business Chestnut Hill,
School Maryland 02167
Marvin J. Girouard President and Chief Pier 1 Imports, Inc.
Operating Officer 301 Commerce Street
of Pier 1 Imports, Suite 600
Inc. Ft. Worth, TX 76161
Diana S. Natalicio President of University of Texas
University of Texas at El Paso
at El Paso Administration Bld.
Suite 500
El Paso, TX 79968
Frederick S. Addy Retired Executive Vice 1009 Red Sail
President of Amoco Horseshoe Bay,
Corporation TX 78654
</TABLE>
Executive Officers of EC who are not Directors
<TABLE>
<CAPTION>
Present Principal
Occupation or
Name Employment Business Address
- ---- ----------------- ----------------
<S> <C> <C>
G. R. Bryan Chairman of Enserch 300 S. St. Paul
Development Dallas, TX 75201
Corporation
Gary J. Junco President and Chief 300 S. St. Paul
Operating Officer of Dallas, TX 75201
EEI and the Company
W. T. Satterwhite Senior Vice President 300 S. St. Paul
and General Counsel, Dallas, TX 75201
Chief Legal Officer
of EC
S. R. Singer Senior Vice President, 300 S. St. Paul
Finance and Corporate Dallas, TX 75201
Development, Chief
Financial Officer
of EC
R. B. Williams Vice President, 300 S. St. Paul
Administration, of EC Dallas, TX 75201
</table/
<PAGE>
<PAGE>
ENSERCH EXPLORATION HOLDINGS, INC. ("EEI")
Directors and Executive Officers of EEI
</TABLE>
<TABLE>
<CAPTION>
Present Principal
Occupation or
Name Employment Business Address
- ---- ----------------- ----------------
<S> <C> <C>
D. W. Biegler Chairman and 300 S. St. Paul
President, Chief Dallas, TX 75201
Executive Officer of
EC
Gary J. Junco President and Chief 300 S. St. Paul
Operating Officer of Dallas, TX 75201
EEI and the Company
W. T. Satterwhite Senior Vice President 300 S. St. Paul
and General Counsel, Dallas, TX 75201
Chief Legal Officer
of EC
S. R. Singer Senior Vice President, 300 S. St. Paul
Finance and Corporate Dallas, TX 75201
Development, Chief
Financial Officer
of EC
R. B. Williams Vice President, 300 S. St. Paul
Administration, of EC Dallas, TX 75201
</TABLE>
<PAGE>
<PAGE>
ENS HOLDINGS I, INC. ("Trustee GP")
Directors and Executive Officers of Trustee GP
<TABLE>
<CAPTION>
Present Principal
Occupation or
Name Employment Business Address
- ---- ----------------- ----------------
<S> <C> <C>
D. W. Biegler Chairman and 300 S. St. Paul
President, Chief Dallas, TX 75201
Executive Officer
of EC
G. R. Bryan Chairman of Enserch 300 S. St. Paul
Development Dallas, TX 75201
Corporation
W. T. Satterwhite Senior Vice President 300 S. St. Paul
and General Counsel, Dallas, TX 75201
Chief Legal Officer
of EC
S. R. Singer Senior Vice President, 300 S. St. Paul
Finance and Corporate Dallas, TX 75201
Development, Chief
Financial Officer
of EC
R. B. Williams Vice President, 300 S. St. Paul
Administration,of EC Dallas, TX 75201
</TABLE>
<PAGE>
Exhibit 1
Trust Agreement
for
ENS Holdings Trust
This Trust Agreement ("Agreement") is made and entered into
this 31st day of December, 1994, between ENSERCH Corporation, a
Texas corporation ("EC"), and ENS Holdings Limited Partnership, a
Texas limited partnership ("Trustee").
Preliminary Statements
A. EC owns a 99% limited partner interest in Enserch
Processing Partners, Ltd., a Texas limited partnership ("EPPL").
B. EC desires to establish a trust under, and upon the terms
and conditions set forth in, this Agreement (the "Trust") and to
transfer to the Trust a 53.50% limited partner interest in EPPL
(the "EPPL Interest").
C. Upon the liquidation of Enserch Exploration Partners,
Ltd., a Texas limited partnership ("EP"), EPPL has acquired
89,881,232 shares (the "EPPL Shares") of the common stock, par
value $1.00 per share ("Common Stock"), of Enserch Exploration,
Inc., a Texas corporation organized in 1994 under the name New
Enserch Exploration, Inc. ("Newco"), pursuant to the plan of
complete liquidation of EP.
D. This Agreement contemplates that the Trust will receive
the 53,336,434 shares of Newco Common Stock (the "Trust Shares")
out of the EPPL Shares as a distribution in redemption of the EPPL
Interest and that the Trust shall own and hold the Trust Shares for
the benefit of EC.
E. Trustee has agreed to act as the trustee of the Trust.
Statement Of Agreement
The parties hereto agree as follows:
Article I.
Creation Of Trust
1.1 Parties. The parties to this Agreement are EC and
Trustee.
1.2 Name of Trust. The Trust established hereunder shall be
named the "ENS Holdings Trust."
1.3 Purpose of the Trust. The parties intend that the Trust
shall be used solely for the purpose of acquiring the EPPL Interest
and then the Trust Shares upon liquidation of the EPPL Interest and
owning and holding the Trust Shares for the benefit of EC.
1.4 Term of Trust. The Trust created hereunder shall
continue until it terminates pursuant to Article VII. Upon the
termination of the Trust, the remaining Trust Estate (as defined in
section 2.1) shall be distributed pursuant to Article IV. The
Trust may be amended or modified only upon the written agreement of
EC and the Trustee. The Trust may be revoked by EC; provided that
EC shall give not less than 90 days prior written notice of
termination to the Trustee, whereafter the Trust shall be revoked
and terminated on the day specified in such notice.
Article II.
Trust Estate
2.1 Trust Estate. The EPPL Interest deposited by EC with
Trustee upon the establishment of the Trust, the Trust Shares
acquired by the Trust upon the liquidation of the EPPL Interest,
and all income of the Trust shall be referred to collectively as
the "Trust Estate."
2.2 Contribution to Trust. EC shall transfer the EPPL
Interest to Trustee. The Trustee shall not accept any further
contributions to the Trust Estate.
2.3 Redemption of EPPL Interest. After receiving the EPPL
Interest, the Trustee, as a limited partner of EPPL, shall provide
its consent to EPPL, on or before January 29th, 1995, to receive
the Trust Shares in redemption of the Trustee's interest in EPPL as
a limited partner and withdrawal of the Trust as a limited partner
of EPPL. Such redemption and withdrawal will have the effect of
completely liquidating the EPPL Interest so that the Trust Estate
will consist solely of the Trust Shares at such time. In no event
shall the Trustee provide such consent after January 29, 1995.
2.4 Holding of Trust Estate. Trustee shall own, hold, manage
and distribute the Trust Estate pursuant to the terms of this
Agreement. Until Trustee is authorized or required to distribute
the Trust Estate pursuant to Article IV, Trustee shall manage the
Trust Estate in accordance with Article III.
2.5 Income of the Trust. The determination of all matters
with respect to what portion of the Trust Estate is principal of
the Trust and what portion of the Trust Estate is income shall be
governed by Texas law.
Article III.
Management of Trust Estate; Trustee Fees and Expenses
3.1 Investment and Management of Trust Estate. Trustee shall
invest, own, manage, and deal with the Trust Estate in whatever
form the same may take, from time to time, and however the same may
be invested, from time to time, as authorized and provided in this
Agreement, subject to the restrictions contained in section 4.2.
Trustee shall collect and receive all income, rents, and profits
derived from the Trust Estate, and shall pay out, deal with, and
dispose of the Income and Principal of the Trust Estate, in all
respects as directed by this Agreement, subject to the restrictions
contained in section 4.2.
3.2 Registration of The Trust Shares. Trustee shall cause
the Trust Shares to be registered in the name of the Trustee on the
books and records of Newco.
3.3 Reserve. Prior to any distribution of any of the Trust
Estate pursuant to Article IV (other than upon termination of the
Trust), Trustee may require and establish a reasonable reserve for
the payment of unpaid Trust expenses, fees, and other obligations
(the "Reserve"). Upon the termination of the Trust pursuant to
Article VII, and after payment of such obligations, the balance of
such Reserve shall be disbursed to EC.
3.4 Trustee's Fees and Expenses.
(a) Trustee shall be paid $1,000 per year as
compensation for its services rendered pursuant to this Agreement
(the "Trustee's Fees").
(b) The Trustee's Fees shall be charged first against
Trust Income and then against Trust Principal. At such time as any
of the Trust Estate is distributed pursuant to Article IV, so much
of the Trustee's Fees that shall have been earned, accrued, and are
still unpaid shall be paid to Trustee prior to the payment of any
Trust Principal or Income to EC, provided, however, that in the
event there is, at such time, insufficient Trust Income to pay all
of said Trustee's Fees, Trustee shall have the right, but not the
obligation, to defer the receipt of payment of any amount of the
Trustee's Fees to any subsequent time, and in such event, Trustee
shall have the right to pay itself earned, accrued, and unpaid
Trustee's Fees that were previously due and payable at any time.
In the event of such deferral, the accrued and unpaid Trustee's
Fees shall bear interest at the rate of 10 percent per annum from
the time such fees were due until actually received by Trustee.
(c) In addition, Trustee shall be reimbursed from the
Trust Estate, first against Trust Income and then against Trust
Principal, for all of Trustee's expenses that are reasonably
incurred as the result of its performance of its obligations and
duties as a trustee under this Agreement (the "Trustee's
Expenses").
Article IV.
Distribution of Principal and Income From Trust
4.1 Limitation on Distribution of Trust Principal and Income.
Except as provided in section 4.2, Trustee shall not distribute any
Trust Principal or Income from the Trust.
4.2 Permitted Distributions of Trust Principal or Income.
(a) Trustee shall distribute to EC (i) any distribution
that the Trust receives with respect to the Trust Shares, (ii) any
property that the Trust receives in exchange for the Trust Shares
or into which Trust Shares may be converted, by shareholder vote or
otherwise, and (iii) any other property that the Trust receives
under any circumstances; provided, however, that the Trustee shall
not so distribute any Newco Common Stock which the Trustee receives
(i) as a share dividend paid on the Newco Common Stock in
authorized but unissued shares of Newco Common Stock on a pro rata
basis among all holders of Newco Common Stock or (ii) as a result
of a pro rata split-up or division of the outstanding Newco Common
Stock which does not increase the stated capital of Newco and
affects all holders of Newco Common Stock equally. Trustee shall
make such distribution to EC promptly after receiving any such
property, and Trustee shall not be permitted to invest any of such
property in any manner prior to distribution to EC.
(b) Upon the termination of the Trust pursuant to
section 7.1, Trustee shall either (i) distribute all of the
remaining Trust Estate in kind to EC or (ii) sell all or part of
the Trust Estate and distribute the proceeds and any remaining
Trust Estate to EC immediately after such sale; provided that the
Trustee shall not be permitted to invest any of such proceeds in
any manner prior to distribution to EC.
(c) Notwithstanding the foregoing, if the Trust is
terminated before the Trust Income that has been earned, accrued,
and received by Trustee, in trust, equals the Trustee's Fees (as
set forth in section 3.4(a) of this Agreement) plus all of
Trustee's Expenses, then Trustee shall have the right to pay, first
out of Trust Income and then out of Trust Principal (to the extent
that Trust Income is insufficient or otherwise unavailable to
Trustee), the Trustee's Fees and the Trustee's Expenses.
4.3 Limitation of Liability for Distribution. EC hereby
agrees to indemnify and hold Trustee harmless, and defend Trustee
from (and pay the reasonable attorney fees and costs incurred in
any such defense) any claim, action, or proceeding brought by EC or
any third party against Trustee in connection with this Agreement
including (1) the distribution of the Trust Estate, if such
distribution is made pursuant to sections 4.1 or 4.2 or (2) the
failure and refusal of the Trustee to distribute the Trust Estate,
if such failure is due to the failure of the EC to provide to
Trustee the written authorization to distribute said Trust Estate.
4.4 Limitation on EC's Rights. Notwithstanding anything
contained herein to the contrary, EC shall have no right or power
other than pursuant to section 4.2 to cause any of the Trust Estate
to be paid or transferred to or for the benefit of any person
except as set forth herein.
Article V.
Trustee; Powers; Duties; Resignation; Removal; Successors
5.1 Trustee. ENS Holdings Limited Partnership shall serve as
the trustee of the Trust created by this Agreement.
5.2 General Powers and Duties. In addition to all other
powers and discretion granted to or vested in the Trustee herein,
Trustee shall have all other powers granted by law that are not
inconsistent with the provisions of this Agreement. Trustee shall
perform only the duties specifically set forth herein, and it may
refuse to perform any other act unless it receives indemnity
satisfactory to it against any loss, claim, or expense.
5.3 Power to Vote and Dispose of Trust Shares. The Trustee
shall vote and may dispose of the Trust Shares, in its sole and
absolute discretion, as it deems proper, provided that the proceeds
of any disposition must be distributed by the Trust as provided in
section 4.2.
5.4 Resignation of Trustee. Trustee may resign at any time
for any reason. Such resignation shall not affect the validity of
the Trust. Such resignation shall be effective upon (1) ninety
days' advance written notice from Trustee to EC stating that
Trustee is resigning and (2) Trustee's designation of a successor
Trustee, which successor must be approved by EC at its reasonable
discretion. If Trustee has not designated a successor trustee
within ten days prior to the proposed effective date of Trustee's
resignation, then EC may appoint a successor trustee and, upon such
appointment, Trustee's resignation shall be effective. All
expenses of Trustee in connection with such action shall be
included in Trustee's Expenses. Trustee shall be discharged from
further responsibility of such office upon properly accounting for
the assets and receipts and disbursements of the Trust Estate of
the successor trustee.
5.5 Removal of Trustee. Trustee may be removed only by an
order of a court of competent jurisdiction.
5.6 Bond. No bond shall be required of any person named in
this Agreement as trustee or successor trustee.
5.7 Successor Trustee Liability. No successor trustee shall
be liable for any act, omission, or default of any predecessor
trustee. Unless requested in writing by EC, no successor trustee
shall have any duty to investigate or review any action of any
predecessor trustee and the successor trustee may accept the
accounting records of the predecessor trustee showing the Trust
Estate without further investigation and without incurring any
liability to any person claiming or having any interest in the
Trust.
5.8 Claim Made Against Trust or Trustee. Trustee shall not
be required to defend, compromise, contest, or arbitrate any claims
or demands, or to commence or defend any action at law or equity,
or to commence, defend, compromise, contest, or arbitrate any other
proceedings brought or instituted by persons other than EC or with
respect to the Trust or the EC to do so, accompanied by money or
any indemnity sufficient, in the sole judgment of Trustee, to cover
all costs, damages, and liabilities in connection therewith,
Trustee may do and perform any or all of the aforesaid acts, in
which event it shall have the powers, rights, and discretion that
it deems reasonably necessary, including the right to employ such
counsel and agents as it shall deem advisable, all at the risk and
expense of the Trust Estate.
In the event that Trustee is involuntarily made a party
in any action or proceeding, it shall, upon being served with
process, give written notice thereof to EC hereunder, and, if,
within five business days thereafter, the EC does not undertake the
defense of Trustee, without expense or liability on the part of
Trustee, then Trustee shall take such actions as it shall deem
necessary and proper, employ such counsel as it deems advisable,
and advance its own funds for the payment of expenses in connection
therewith, all at the risk and expense of the Trust Estate.
If Trustee is involuntarily made a party to any action by
EC or is requested to act in a manner that Trustee reasonably
concludes is either not authorized by this Agreement or which will
expose Trustee to liability, Trustee shall be entitled to
interplead or otherwise seek judicial relief as it, in its
reasonable discretion, deems appropriate, all at the risk and
expense of the Trust Estate.
5.9 Reliance of Trustee. Trustee may rely and shall be
protected in acting upon any statement believed by it to be genuine
and to have been properly signed and presented by the proper party.
5.10 Reliance on Statement by Trustee. Any person dealing
with Trustee shall be fully protected in relying on Trustee's
certificate that it has the authority to take any action under this
Agreement. Persons dealing with Trustee shall look only to the
Trust Estate to satisfy any liability incurred by Trustee to such
person in carrying out the terms of this Agreement.
5.11 Fiduciary Office. Trustee shall have the right to
qualify its execution of any instrument or document so as to (1)
limit its undertaking to its fiduciary office and (2) evidence a
restriction on its liability to the Trust Estate.
5.12 Disclosing Trust. Whenever in the judgment of Trustee it
shall be necessary or proper in the administration of the Trust,
Trustee may disclose the existence, nature, terms, and conditions
of the Trust and this Agreement and the ownership of the Trust
Shares. Trustee shall have the power to make such filings with the
Securities and Exchange Commission and other governmental agencies
that in its judgment may be required to disclose any of same.
Article VI.
Taxes
The parties agree that for federal income tax purposes all
income earned by the Trust (including all gains or losses realized
upon the sale or other disposition of the Trust Estate) shall be
attributable and allocated to EC, and the parties agree to report
such income accordingly.
Article VII.
Termination Of Trust
7.1 Termination of Trust. The Trust shall terminate upon the
earliest of (1) the distribution of all of the Trust Estate
pursuant to Article IV, (2) the distribution of all of the Trust
Estate as a result of a court order or a revocation of the Trust by
EC pursuant to section 1.4, (3) the bankruptcy, dissolution, or
complete liquidation of EC, (4) EC's transfer or attempt to
transfer any part of its interest in the Trust, or (5) December 31,
2014.
7.2 Accounting. Upon termination of the Trust, Trustee shall
render a final accounting setting forth the amount of funds placed
into the Trust pursuant to sections 2.2 and 2.4, the amount of
Trust Income earned, the amount paid to Trustee for Trustee's Fees,
Trustee's Expenses, and for other expenses, as permitted herein,
and the amount distributed pursuant to Article IV. Upon rendering
a proper final account, Trustee shall be discharged from further
responsibility of such office.
Article VIII.
General Provisions
8.1 Prohibitions Against Assignment or Other Transfers. No
party may, in any manner, transfer, assign, hypothecate, or
otherwise encumber its interest in the Trust, or its right to
receive any of the Trust Estate. The rights and interests of EC in
the Trust and in the Trust Estate shall not be subject to the
claims of any creditors or liable to an attachment, execution, or
process of law.
8.2 Jurisdiction and Venue. The Trust is created pursuant to
and under the laws of the State of Texas, has been accepted by
Trustee in the State of Texas, and all matters of validity,
interpretation, and enforcement are to be determined in accordance
with the law of that state. In the event of any dispute or other
legal proceeding with respect to the Trust, the courts of the State
of Texas shall have venue over such proceedings.
8.3 Severability. If any provision of this Agreement is
determined by a court of competent jurisdiction to be
unenforceable, invalid, or otherwise contrary to law, the remaining
provisions of this Agreement shall be and remain, to the fullest
extent possible under such circumstances, fully enforceable and
shall be carried out.
8.4 Title and Captions. All titles and captions are for
convenience only and shall not be deemed to be a part of this
Agreement.
8.5 Section References. All section and article numbers
refer to sections and articles in this Agreement unless stated
otherwise.
8.6 Notices. All notices, statements, and other
communications required or permitted to be given pursuant to this
Agreement shall be in writing and shall be deemed to have been duly
made only when addressed to the party to whom such communication is
being sent at the addresses next to the party's signature below and
either (1) delivered by hand to the person who has executed this
document on behalf of the relevant party, (2) mailed by postage-
prepaid first class certified mail, return receipt required, or (3)
transmitted by telephone facsimile service, with a copy sent by
postage-prepaid first class mail. Any party may change the address
to which communications are to be sent by giving notice of such
change of address to all other parties in conformance with this
section.
Article IX.
Certification
10.1 Certification. Any person signing this Agreement as or
on behalf of EC certifies, by signing, that he has read the
foregoing Agreement, that it correctly states the terms and
conditions under which the Trust Estate is to be held, managed, and
distributed by Trustee, and that he approves of this Agreement in
all its particulars and requests Trustee to execute it.
10.2 Independent Decision. Each person signing this Agreement
as or on behalf of a EC acknowledges that he is not relying on the
advice or opinion of Trustee with respect to any legal matter
involving the establishment or operation of the Trust.
GRANTOR:
ENSERCH Corporation, a Texas corporation
300 South St. Paul Street
Dallas, Texas 75201
By: /s/ A. E. Gallatin
---------------------
Vice President
TRUSTEE:
ENS Holdings Limited Partnership, a Texas limited partnership
By: ENS Holdings I, Inc., a Texas corporation,
General Partner
By: /s/ J. W. Pinkerton
------------------------
Vice President
