AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 15, 1998
REGISTRATION NO. 33-52525
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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ENSERCH CORPORATION
(Exact name of registrant as specified in its charter)
TEXAS 75-0399066
(State or other (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
ENERGY PLAZA, 1601 BRYAN STREET
DALLAS, TEXAS 75201
(214) 812-4600
(Address, including zip code, and telephone number, including
area code, of registrants' principal executive offices)
ROBERT A. WOOLDRIDGE, ESQ. PETER B. TINKHAM ROBERT J. REGER, JR.,
WORSHAM, FORSYTHE EXECUTIVE VICE ESQ.
& WOOLDRIDGE, L.L.P. PRESIDENT REID & PRIEST LLP
ENERGY PLAZA, 1601 BRYAN TEXAS UTILITIES 40 WEST 57TH STREET
STREET SERVICES INC. NEW YORK, NEW YORK
DALLAS, TEXAS 75201 ENERGY PLAZA 10019
(214) 979-3000 1601 BRYAN STREET (212) 603-2000
DALLAS, TEXAS
75201
(214) 812-4600
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
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IT IS RESPECTFULLY REQUESTED THAT THE COMMISSION SEND
COPIES OF ALL NOTICES, ORDERS AND COMMUNICATIONS TO:
STEPHEN K. WAITE, ESQ.
WINTHROP, STIMSON, PUTNAM & ROBERTS
ONE BATTERY PARK PLAZA
NEW YORK, NEW YORK 10004
(212) 858-1000
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REMOVAL OF SECURITIES FROM REGISTRATION AND
CHANGES TO THE TERMS OF REGISTERED DEBT SECURITIES
Since the effective date of Registration Statement No. 33-
52525 (Registration Statement) two of the registrants thereunder,
Enserch Capital L.L.C. (Enserch LLC) and Enserch Preferred Capital,
Inc. have ceased to exist. The Company, the remaining registrant
under the Registration Statement, hereby amends the Registration
Statement to withdraw from registration all the Enserch Capital
L.C.C. Preferred Securities and ENSERCH Corporation and Enserch
Preferred Capital, Inc. Backup Undertakings with respect to
Enserch Capital L.L.C. Preferred Securities registered under the
Registration Statement. The Company further amends the
Registration Statement to withdraw from registration all the
ENSERCH Corporation Preferred Stock, of no par value, the ENSERCH
Corporation Depositary Shares, and the ENSERCH Corporation Common
Stock, par value $4.45 per share. The securities remaining
registered under the Registration Statement are the ENSERCH
Corporation Debt Securities having the terms described in the
Prospectus included in this Post-Effective Amendment No. 1 to the
Registration Statement.
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Information contained herein is subject to completion or
amendment. An amendment to the registration statement relating
to these securities has been filed with the Securities and
Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the amendment to the
registration statement becomes effective. This prospectus shall
not constitute an offer to sell or the solicitation of an offer
to buy nor shall there be any sale of these securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
SUBJECT TO COMPLETION, DATED JANUARY 15, 1998
PROSPECTUS
$225,000,000
ENSERCH CORPORATION
DEBT SECURITIES
ENSERCH Corporation, a Texas corporation (Company), may
offer, from time to time, in amounts, at prices and on terms to
be determined at the time of offering, unsecured debt securities
of the Company consisting of debentures, notes or other unsecured
evidences of indebtedness (Debt Securities).
Specific terms of each issue of Debt Securities in respect
of which this Prospectus is being delivered (Offered Debt
Securities) will be set forth in one or more Prospectus
Supplements with respect to such Offered Debt Securities. The
applicable Prospectus Supplement will describe, without
limitation and where applicable or additional to the terms in the
Prospectus, the following: the title, aggregate principal amount,
denomination, maturity, premium, if any, rate of interest (which
may be fixed or variable) or method of calculation thereof, time
of payment of interest, any terms for redemption, any sinking
fund provisions, the initial public offering price, the principal
amounts, if any, to be purchased by underwriters and any other
special terms of the Offered Debt Securities.
The Company may sell the Debt Securities through
underwriters, dealers or agents designated from time to time, or
directly to one or more of a limited number of purchasers. If
any agents of the Company or any underwriters or dealers are
involved in the sales of the Offered Debt Securities, the names
of such agents or such underwriters or dealers and any applicable
commissions or discounts will be set forth in the related
Prospectus Supplement. See PLAN OF DISTRIBUTION.
This Prospectus may not be used to consummate sales of Debt
Securities unless accompanied by a Prospectus Supplement.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR BY ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is January , 1998.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company, File No. 1-
3183, with the Securities and Exchange Commission (Commission)
pursuant to the Securities Exchange Act of 1934, as amended (1934
Act), are incorporated herein by reference:
1. Annual Report on Form 10-K for the year ended December 31,
1996 (1996 10-K).
2. Quarterly Reports on Form 10-Q for the quarters ended March
31, 1997, June 30, 1997 and September 30, 1997.
3. Current Reports on Form 8-K, dated January 14, 1997, March
12, 1997, June 5, 1997, July 3, 1997, August 4, 1997,
August 6, 1997 and January 6, 1998.
All documents subsequently filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the 1934 Act and prior to
the termination of the offering hereunder shall be deemed to be
incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents; provided,
however, that the documents enumerated above or subsequently
filed by the Company pursuant to Section 13(a), 13(c) or 15(d) of
the 1934 Act prior to the filing with the Commission of the
Company's most recent Annual Report on Form 10-K shall not be
incorporated by reference in this Prospectus or be a part hereof
from and after the filing of such Annual Report on Form 10-K. The
documents which are incorporated by reference in this Prospectus
are sometimes hereinafter referred to as the "Incorporated
Documents."
Any statement contained in an Incorporated Document shall be
deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in
any other subsequently filed document which is deemed to be
incorporated by reference herein or in the Prospectus Supplement
modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO
EACH PERSON, INCLUDING ANY BENEFICIAL OWNER, TO WHOM A COPY OF
THIS PROSPECTUS HAS BEEN DELIVERED, UPON WRITTEN OR ORAL REQUEST
OF ANY SUCH PERSON, A COPY OF ANY AND ALL OF THE INCORPORATED
DOCUMENTS WHICH HAVE BEEN OR MAY BE INCORPORATED IN THIS
PROSPECTUS BY REFERENCE, OTHER THAN EXHIBITS TO SUCH DOCUMENTS
(UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE
INTO SUCH DOCUMENTS). REQUESTS SHOULD BE DIRECTED TO: SECRETARY,
ENSERCH CORPORATION, 1601 BRYAN STREET, DALLAS, TEXAS 75201,
TELEPHONE NUMBER (214) 812-4600.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the 1934 Act and in accordance therewith files reports, proxy and
information statements and other information with the Commission.
Such reports, proxy and information statements and other
information filed by the Company can be inspected and copied at
the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the following Regional Offices of the Commission: Chicago
Regional Office, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511; and New York Regional Office, 7 World Trade
Center, Suite 1300, New York, New York 10048. Copies of such
material can also be obtained from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. In addition, the Commission maintains
a World Wide Web site (http://www.sec.gov) that contains reports,
proxy and information statements, and other information filed by
the Company. Certain Depositary Shares representing fractional
interests in shares of cumulative preferred stock of the Company
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are listed on the New York Stock Exchange, where reports and
other information concerning the Company may be inspected.
Securityholders of the Company may obtain, upon request,
copies of an Annual Report on Form 10-K containing financial
statements as of the end of the most recent fiscal year audited
and reported upon (with an opinion expressed) by independent
auditors.
THE COMPANY
The Company was incorporated under the laws of the State of
Texas in 1942 and has perpetual existence under the provisions of
the Texas Business Corporation Act. The Company, a wholly owned
subsidiary of Texas Utilities Company (Texas Utilities), is an
integrated company focused on natural gas. Its major business
operations are natural gas pipeline, processing, marketing and
distribution. Through these business operations, the Company is
engaged in owning and operating interconnected natural gas
transmission lines, underground storage reservoirs, compressor
stations and related properties in Texas; gathering and
processing natural gas to remove impurities and extract liquid
hydrocarbons for sale, and the wholesale and retail marketing of
natural gas in several areas of the United States, and owning and
operating approximately 550 local gas utility distribution
systems in Texas. The principal executive offices of the Company
are located at 1601 Bryan Street, Dallas, Texas 75201; the
telephone number is (214) 812-4600.
On August 5, 1997 (Merger Date), Texas Utilities became the
holding company for both the Company and Texas Energy Industries,
Inc. (TEI). Immediately prior to the transaction (Merger), the
Company's ownership interests in Enserch Exploration, Inc. and
Lone Star Energy Plant Operations, Inc. (together, the Unacquired
Business) were distributed to the holders of the Company's common
stock. Pursuant to the Merger, Lone Star Gas Company and Lone
Star Pipeline Company, the local distribution and pipeline
divisions of the Company, and other businesses, excluding the
Unacquired Businesses, were acquired by Texas Utilities.
TEI is a holding company formerly known as Texas Utilities
Company. The principal subsidiary of TEI is Texas Utilities
Electric Company (TU Electric), which is an electric utility
engaged in the generation, purchase, transmission, distribution
and sale of electric energy wholly within the State of Texas.
The other electric utility subsidiaries of TEI are Southwestern
Electric Service Company, which is engaged in the purchase,
transmission, distribution and sale of electric energy in ten
counties in the eastern and central parts of Texas with a
population estimated at 126,900, and Texas Utilities Australia
Pty. Ltd., owner of Eastern Energy Limited, which is engaged in
the purchase, distribution, marketing and sale of electric energy
to approximately 481,000 customers in the State of Victoria,
Australia. TEI also has three other subsidiaries which perform
specialized functions within the Texas Utilities system: Texas
Utilities Fuel Company owns a natural gas pipeline system,
acquires, stores and delivers fuel gas and provides other fuel
services at cost for the generation of electric energy by TU
Electric; Texas Utilities Mining Company owns, leases and
operates fuel production facilities for the surface mining and
recovery of lignite at cost for the generation of electric energy
by TU Electric; and Texas Utilities Services Inc. provides
financial, accounting, information technology, environmental
services, customer services, personnel, procurement and other
administrative services at cost. In addition, in November
1997, Texas Utilities acquired Lufkin-Conroe Communications Co.
(LCC). LCC offers long-distance, cellular, internet and other
services and provides local telephone services in Southeast
Texas.
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USE OF PROCEEDS
The Company is offering hereby an aggregate of $225,000,000
of Debt Securities. The net proceeds to be received by the
Company from the sale of the Debt Securities, together with funds
from operations, are expected to be used for the redemption or
repurchase of certain of its outstanding debt and preferred
stock, and may also be used to meet expenditures for its
construction program and for other corporate purposes, including
the repayment of short-term borrowings incurred for similar
purposes and outstanding at the time of any such sale. Proceeds
may be temporarily invested in short-term instruments pending
their application to the foregoing purposes.
Reference is made to the Prospectus Supplement applicable to
each issuance of Offered Debt Securities.
HISTORICAL AND PRO FORMA RATIOS OF EARNINGS TO FIXED CHARGES AND
EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
On the Merger Date, the Company became a wholly-owned
subsidiary of Texas Utilities. Immediately prior to the Merger
Date, the Company distributed to its common shareholders its
interests in the Unacquired Businesses. Texas Utilities
accounted for its acquisition of the Company as a purchase. As a
result, the Company has made certain purchase accounting
adjustments which are reflected in ratios for periods subsequent
to the Merger Date. Historical ratios for periods ending prior
to the Merger Date were prepared using the Company's historical
basis of accounting. Amounts for the period from January 1, 1997
through the Merger Date have been restated to reflect the
Unacquired Businesses as discontinued operations.
Adjusted ratios are based on unaudited "pro forma" financial
information, which is included in the Current Report on Form 8-K
of the Company dated January 6, 1998 which is incorporated herein
by reference. The "pro forma" financial information gives effect
to (i) the distribution by the Company of its interests in the
Unacquired Businesses and (ii) the purchase accounting
adjustments as a result of the acquisition of the Company by
Texas Utilities, all on a pro forma basis as if the events had
occurred at the beginning of each period presented.
The ratio of earnings to fixed charges for each of the years
ended December 31, 1994, 1995 and 1996 was 1.09, 1.06 and 1.44.
For each of the years ended December 31, 1992 and 1993, the
period from January 1, 1997 through the Merger Date and the
period from the Merger Date through September 30, 1997, fixed
charges exceeded earnings by $0.2 million, $8.3 million, $19.0
million and $19.8 million, respectively. The ratio of earnings
to fixed charges, as adjusted, for the year ended December 31,
1996 was 1.24. For the nine months ended September 30, 1997, as
adjusted, fixed charges exceeded earnings by $17.3 million.
The ratio of earnings to combined fixed charges and
preferred dividends for the year ended December 31, 1996 was
1.24. For each of the years ended December 31, 1992 through
1995, the period from January 1, 1997 through the Merger Date and
the period from the Merger Date through September 30, 1997,
combined fixed charges and preferred dividends exceeded earnings
by $13.2 million, $21.0 million, $3.7 million, $6.3 million,
$27.7 million and $22.5 million, respectively. The ratio of
earnings to fixed charges, as adjusted, for the year ended
December 31, 1996, was 1.01. For the nine months ended September
30, 1997, as adjusted, combined fixed charges and preferred
dividends exceeded earnings by 40.2 million.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued in one or more series
under an indenture or indentures (each an Indenture) between the
Company and The Bank of New York or other financial institutions
to be named, as Trustee (each an Indenture Trustee), a form of
which is filed as an exhibit to the Registration Statement, as
amended, of which this Prospectus forms a part. The following
description of the terms of the Debt Securities does not purport
to be complete and is qualified in its entirety by reference to
(i) the respective Indenture and (ii) one or more officer's
certificates establishing the Debt Securities to which a form of
Debt Security will be attached. Whenever particular provisions
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or defined terms in an Indenture are referred to under this
DESCRIPTION OF DEBT SECURITIES, such provisions or defined terms
are incorporated by reference herein.
General. Each Indenture will provide for the issuance of
Debt Securities in an unlimited amount from time to time. All
Debt Securities will be unsecured obligations of the Company.
All Debt Securities issued under an Indenture will rank equally
and ratably with all other Debt Securities issued under such
Indenture. An Indenture will not limit other unsecured debt.
The Company's financial statements included in the Incorporated
Documents show the amount of such other debt at the date of such
statements. See the Prospectus Supplement applicable to each
series of Offered Debt Securities.
The applicable Prospectus Supplement or Prospectus
Supplements will describe the following terms of the Debt
Securities: (1) the title of the Debt Securities; (2) any limit
upon the aggregate principal amount of the Debt Securities; (3)
the date or dates on which the principal of the Debt Securities
is payable or the method of determination thereof; (4) the rate
or rates, if any, or the method by which such rate will be
determined, at which the Debt Securities will bear interest, if
any, the date or dates from which any such interest will accrue,
the Interest Payment Dates on which any such interest will be
payable and the Regular Record Date for any interest payable on
any Interest Payment Date and the Person or Persons to whom
interest on such Debt Securities will be payable on any Interest
Payment Date, if other than the Persons in whose names such Debt
Securities are registered at the close of business on the Regular
Record Date for such interest; (5) the place or places where,
subject to the terms of the respective Indenture as described
below under "Payment and Paying Agents," the principal of and
premium, if any, and interest on the Debt Securities will be
payable and where, subject to the terms of such Indenture as
described below under "Registration and Transfer," the Debt
Securities may be presented for registration of transfer or
exchange and the place or places where notices and demands to or
upon the Company in respect of the Debt Securities and such
Indenture may be served; the Security Registrar for such Debt
Securities; and, if such is the case, that the principal of such
Debt Securities will be payable without presentment or surrender
thereof; (6) the period or periods within, or date or dates on,
which, the price or prices at which and the terms and conditions
upon which Debt Securities may be redeemed, in whole or in part,
at the option of the Company; (7) the obligation or obligations,
if any, of the Company to redeem or purchase any of the Debt
Securities pursuant to any sinking fund or other mandatory
redemption provisions or at the option of the Holder thereof, and
the period or periods within which, or the date or dates on
which, the price or prices at which and the terms and conditions
upon which the Debt Securities will be redeemed or purchased, in
whole or in part, pursuant to such obligation, and applicable
exceptions to the requirements of a notice of redemption in the
case of mandatory redemption or redemption at the option of the
Holder; (8) the denominations in which any Debt Securities will
be issuable, if other than denominations of $1,000 and any
integral multiple thereof; (9) the currency or currencies,
including composite currencies in which the principal of or any
premium or interest on the Debt Securities will be payable (if
other than in Dollars); (10) if the principal of or any premium
or interest on the Debt Securities is to be payable, at the
election of the Company or the Holder thereof, in a coin or
currency other than that in which the Debt Securities are stated
to be payable, the period or periods within which and the terms
and conditions upon which, such election is to be made; (11) if
the principal of or premium or interest on the Debt Securities is
to be payable, or is to be payable at the election of the Company
or a Holder thereof, in securities or other property, the type
and amount of such securities or other property, or the method or
other means by which such amount will be determined, and the
period or periods within which, and the terms and conditions upon
which, any such election may be made; (12) if the amount payable
in respect of principal of or any premium or interest on the Debt
Securities may be determined with reference to an index or other
fact or event ascertainable outside of the respective Indenture,
the manner in which such amounts will be determined; (13) if
other than the principal amount thereof, the portion of the
principal amount of the Debt Securities which will be payable
upon declaration of acceleration of the Maturity thereof; (14)
any Events of Default, in addition to those specified in the
respective Indenture, with respect to the Debt Securities and any
covenants of the Company for the benefit of the Holders of the
Debt Securities, in addition to those specified in such
Indenture; (15) the terms, if any, pursuant to which the Debt
Securities may be converted into or exchanged for shares of
capital stock or other securities of the Company or any other
Person; (16) the obligations or instruments, if any, which will
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be considered to be Eligible Obligations in respect of such Debt
Securities denominated in a currency other than Dollars or in a
composite currency, and any additional or alternative provisions
for the reinstatement of the Company's indebtedness in respect of
such Debt Securities after the satisfaction and discharge
thereof; (17) if the Debt Securities are to be issued in global
form, (i) any limitations on the rights of the Holder or Holders
of such Debt Securities to transfer or exchange the same or to
obtain the registration of transfer thereof, (ii) any limitations
on the rights of the Holder or Holders thereof to obtain
certificates therefor in definitive form in lieu of temporary
form and (iii) any and all other matters incidental to such Debt
Securities; (18) if the Debt Securities are to be issuable as
bearer securities any and all matters incidental thereto; (19) to
the extent not addressed in item (17) above, any limitations on
the rights of the Holders of the Debt Securities to transfer or
exchange the Debt Securities or to obtain the registration of
transfer thereof, and if a service charge will be made for the
registration of transfer or exchange of the Debt Securities, the
amount or terms thereof; (20) any exceptions to the provisions
governing payments due on legal holidays or any variations in the
definition of Business Day with respect to such Debt Securities;
and (21) any other terms of the Debt Securities, not inconsistent
with the provisions of the respective Indenture (Indenture,
Section 301).
Debt Securities may be sold at a discount below their
principal amount. Certain special United States federal income
tax considerations, if any, applicable to Debt Securities sold at
an original issue discount may be described in the applicable
Prospectus Supplement. In addition, certain special United States
federal income tax or other considerations, if any, applicable to
any Debt Securities which are denominated in a currency or
currency unit other than Dollars may be described in the
applicable Prospectus Supplement.
Except as may otherwise be described in the applicable
Prospectus Supplement, the covenants contained in an Indenture
will not afford Holders of Debt Securities protection in the
event of a highly-leveraged transaction involving the Company.
Payment and Paying Agents. Except as may be provided in the
applicable Prospectus Supplement, interest, if any, on each Debt
Security payable on each Interest Payment Date will be paid to
the Person in whose name such Debt Security is registered as of
the close of business on the Regular Record Date relating to such
Interest Payment Date; provided, however, that interest payable
at maturity (whether at stated maturity, upon redemption or
otherwise, herein a Maturity) will be paid to the Person to whom
principal is paid. However, if there has been a default in the
payment of interest on any Debt Security, such defaulted interest
may be payable to the Holder of such Debt Security as of the
close of business on a date selected by the respective Indenture
Trustee which is not more than 15 days and not less than 10 days
prior to the date proposed by the Company for payment on such
defaulted interest or in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such
Debt Security may be listed, if such Indenture Trustee deems such
manner of payment practicable (Indenture, Section 307).
Unless otherwise specified in the applicable Prospectus
Supplement, the principal of and premium, if any, and interest
on, the Debt Securities at Maturity will be payable upon
presentation of the Debt Securities at the corporate trust office
of The Bank of New York, in The City of New York, as Paying Agent
for the Company. The Company may change the Place of Payment on
the Debt Securities, may appoint one or more additional Paying
Agents (including the Company) and may remove any Paying Agent,
all at its discretion (Indenture, Section 602).
Registration and Transfer. Unless otherwise specified in
the applicable Prospectus Supplement, the transfer of Debt
Securities may be registered, and Debt Securities may be
exchanged for other Debt Securities of the same series or
tranche, of authorized denominations and of like tenor and
aggregate principal amount, at the corporate trust office of The
Bank of New York in The City of New York, as Security Registrar
for the Debt Securities. The Company may change the place for
registration of transfer and exchange of the Debt Securities and
may designate one or more additional places for such registration
and exchange, all at its discretion. Except as otherwise provided
in the applicable Prospectus Supplement, no service charge will
be made for any transfer or exchange of the Debt Securities, but
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the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of the
Debt Securities. The Company will not be required to execute or
to provide for the registration of transfer of, or the exchange
of, (a) any Debt Security during a period of 15 days prior to
giving any notice of redemption or (b) any Debt Security selected
for redemption in whole or in part, except the unredeemed portion
of any Debt Security being redeemed in part (Indenture, Section
305).
Defeasance. The principal amount of any series of Debt
Securities issued under an Indenture will be deemed to have been
paid for purposes of such Indenture and the entire indebtedness
of the Company in respect thereof will be deemed to have been
satisfied and discharged if there shall have been irrevocably
deposited with the respective Indenture Trustee or any paying
agent, in trust: (a) money in an amount which will be
sufficient, or (b) in the case of a deposit made prior to the
maturity of the Debt Securities, Eligible Obligations (as defined
below), the principal of and the interest on which when due,
without any regard to reinvestment thereof, will provide moneys
which, together with the money, if any, deposited with or held by
such Indenture Trustee, will be sufficient, or (c) a combination
of (a) and (b) which will be sufficient, to pay when due the
principal of and premium, if any, and interest, if any, due and
to become due on the Debt Securities of such series that are
Outstanding. For this purpose, Eligible Obligations include
direct obligations of, or obligations unconditionally guaranteed
by, the United States of America entitled to the benefit of the
full faith and credit thereof and certificates, depositary
receipts or other instruments which evidence a direct ownership
interest in such obligations or in any specific interest or
principal payments due in respect thereof and which do not
contain provisions permitting the redemption or other prepayment
thereof at the option of the issuer thereof (Indenture, Section
701).
Consolidation, Merger, and Sale of Assets. Under the terms
of an Indenture, the Company may not consolidate with or merge
into any other entity or convey, transfer or lease its properties
and assets substantially as an entirety to any entity, unless
(i) the entity formed by such consolidation or into which the
Company is merged or the entity which acquires by conveyance or
transfer, or which leases, the property and assets of the Company
substantially as an entirety shall be an entity organized and
validly existing under the laws of any domestic jurisdiction and
such entity expressly assumes the Company's obligations on all
Debt Securities and under such Indenture, (ii) immediately after
giving effect to the transaction, no Event of Default, and no
event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing, and
(iii) the Company shall have delivered to the respective
Indenture Trustee an Officer's Certificate and an Opinion of
Counsel as provided in such Indenture (Indenture, Section 1101).
The terms of an Indenture will not restrict the Company in a
merger in which the Company is the surviving entity.
Events of Default. Each of the following will constitute an
Event of Default under the Indenture with respect to the Debt
Securities of any series: (a) failure to pay any interest on the
Debt Securities of such series within 30 days after the same
becomes due and payable; (b) failure to pay principal or premium,
if any, on the Debt Securities of such series when due and
payable; (c) failure to perform, or breach of, any other covenant
or warranty of the Company in such Indenture (other than a
covenant or warranty of the Company in such Indenture solely for
the benefit of one or more series of Debt Securities other than
such series) for 90 days after written notice to the Company by
the respective Indenture Trustee, or to the Company and such
Indenture Trustee by the Holders of at least 33% in principal
amount of the Debt Securities of such series Outstanding under
such Indenture as provided in such Indenture; (d) the entry by a
court having jurisdiction in the premises of (1) a decree or
order for relief in respect of the Company in an involuntary case
or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or (2) a decree
or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition by one or more Persons
other than the Company seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company under
any applicable federal or state law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other
similar official for the Company or for any substantial part of
its property, or ordering the winding up or liquidation of its
affairs, and any such decree or order for relief or any such
other decree or order shall have remained unstayed and in effect
7
<PAGE>
for a period of 90 consecutive days; and (e) the commencement by
the Company of a voluntary case or proceeding under any
applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree or order for relief in
respect of the Company in a case or other similar proceeding or
to the commencement of any bankruptcy or insolvency case or
proceeding against it under any applicable federal or state law
or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable federal or state
law, or the consent by it to the filing of such petition or to
the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official
of the Company of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or
the admission by it in writing of its inability to pay its debts
generally as they become due, or the authorization of such action
by the Board of Directors (Indenture, Section 801).
An Event of Default with respect to the Debt Securities of a
particular series may not necessarily constitute an Event of
Default with respect to Debt Securities of any other series
issued under the same Indenture or Debt Securities issued under
any other Indenture.
Remedies. If an Event of Default due to the default in
payment of principal of or interest on any series of Debt
Securities or due to the default in the performance or breach of
any other covenant or warranty of the Company applicable to the
Debt Securities of such series but not applicable to all series
of Debt Securities issued under the same Indenture occurs and is
continuing, then either the respective Indenture Trustee or the
Holders of not less than 33% in principal amount of the
outstanding Debt Securities of such series may declare the
principal of all of the Debt Securities of such series and
interest accrued thereon to be due and payable immediately. If
an Event of Default due to the default in the performance of any
other covenants or agreements in an Indenture applicable to all
Outstanding Debt Securities under such Indenture or due to
certain events of bankruptcy, insolvency or reorganization of the
Company has occurred and is continuing, either the respective
Indenture Trustee or the Holders of not less than 33% in
principal amount of all such Outstanding Debt Securities,
considered as one class, and not the Holders of the Debt
Securities of any one of such series, may make such declaration
of acceleration.
At any time after the declaration of acceleration with
respect to the Debt Securities of any series has been made and
before a judgment or decree for payment of the money due has been
obtained, the Event or Events of Default giving rise to such
declaration of acceleration will, without further act, be deemed
to have been waived, and such declaration and its consequences
will, without further act, be deemed to have been rescinded and
annulled, if:
(a) the Company has paid or deposited with the respective
Indenture Trustee a sum sufficient to pay
(1) all overdue interest on all Debt Securities of
such series;
(2) the principal of and premium, if any, on any Debt
Securities of such series which have become due otherwise
than by such declaration of acceleration and interest
thereon at the rate or rates prescribed therefor in such
Debt Securities;
(3) interest upon overdue interest at the rate or
rates prescribed therefor in such Debt Securities, to the
extent that payment of such interest is lawful; and
(4) all amounts due to such Indenture Trustee under
the respective Indenture; and
(b) any other Event or Events of Default with respect to
Debt Securities of such series, other than the nonpayment of the
principal of the Debt Securities of such series which has become
due solely by such declaration of acceleration, have been cured
or waived as provided in such Indenture (Indenture, Section 802).
8
<PAGE>
There is no automatic acceleration, even in the event of
bankruptcy, insolvency or reorganization of the Company.
Subject to the provisions of an Indenture relating to the
duties of the Indenture Trustee in case an Event of Default shall
occur and be continuing, the respective Indenture Trustee will be
under no obligation to exercise any of its rights or powers under
such Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to such Indenture Trustee
reasonable security or indemnity (Indenture, Section 903). If an
Event of Default has occurred and is continuing in respect of a
series of Debt Securities, subject to such provisions for the
indemnification of such Indenture Trustee, the Holders of a
majority in principal amount of the Outstanding Debt Securities
of such series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to
such Indenture Trustee, or exercising any trust or power
conferred on such Indenture Trustee, with respect to the Debt
Securities of such series; provided, however, that if an Event of
Default occurs and is continuing with respect to more than one
series of Debt Securities under an Indenture, the Holders of a
majority in aggregate principal amount of the Outstanding Debt
Securities of all such series, considered as one class, will have
the right to make such direction, and not the Holders of the Debt
Securities of any one of such series; and provided, further, that
such direction will not be in conflict with any rule of law or
with such Indenture (Indenture, Section 812).
No Holder of Debt Securities of any series will have any
right to institute any proceeding with respect to the respective
Indenture, or for the appointment of a receiver or a trustee, or
for any other remedy thereunder, unless (i) such Holder has
previously given to the respective Indenture Trustee written
notice of a continuing Event of Default with respect to the Debt
Securities of such series, (ii) the Holders of not less than a
majority in aggregate principal amount of the Outstanding Debt
Securities of all series under such Indenture in respect of which
an Event of Default shall have occurred and be continuing,
considered as one class, have made written request to such
Indenture Trustee, and such Holder or Holders have offered
reasonable indemnity to such Indenture Trustee to institute such
proceeding in respect of such Event of Default in its own name as
trustee and (iii) such Indenture Trustee has failed to institute
any proceeding, and has not received from the Holders of a
majority in aggregate principal amount of the Outstanding Debt
Securities of such series a direction inconsistent with such
request, within 60 days after such notice, request and offer
(Indenture, Section 807). However, such limitations do not apply
to a suit instituted by a Holder of a Debt Security for the
enforcement of payment of the principal of or any premium or
interest on such Debt Security on or after the applicable due
date specified in such Debt Security (Indenture, Section 808).
The Company will be required to furnish to each Indenture
Trustee annually a statement by an appropriate officer as to such
officer's knowledge of the Company's compliance with all
conditions and covenants under the respective Indenture, such
compliance to be determined without regard to any period of grace
or requirement of notice under such Indenture (Indenture, Section
606).
Modification and Waiver. Without the consent of any Holder
of Debt Securities, the Company and the Indenture Trustee under
an Indenture may enter into one or more supplemental indentures
for any of the following purposes: (a) to evidence the assumption
by any permitted successor to the Company of the covenants of the
Company in such Indenture and in any of the Debt Securities
Outstanding under such Indenture; or (b) to add one or more
covenants of the Company or other provisions for the benefit of
all Holders or for the benefit of the Holders of, or to remain in
effect only so long as there shall be Outstanding, Debt
Securities of one or more specified series, or one or more
specified Tranches thereof, or to surrender any right or power
conferred upon the Company by such Indenture; or (c) to add any
additional Events of Default with respect to Outstanding Debt
Securities; or (d) to change or eliminate any provision of such
Indenture or to add any new provision to such Indenture, provided
that if such change, elimination or addition will adversely
affect the interests of the Holders of Debt Securities of any
series or Tranche in any material respect, such change,
elimination or addition will become effective with respect to
such series or Tranche only (1) when the consent of the Holders
9
<PAGE>
of Debt Securities of such series or Tranche has been obtained in
accordance with such Indenture, or (2) when no Debt Securities of
such series or Tranche remain Outstanding under such Indenture;
or (e) to provide collateral security for all but not part of the
Debt Securities issued under such Indenture; or (f) to establish
the form or terms of Debt Securities of any other series or
Tranche as permitted by such Indenture; or (g) to provide for the
authentication and delivery of bearer securities and coupons
appertaining thereto representing interest, if any, thereon and
for the procedures for the registration, exchange and replacement
thereof and for the giving of notice to, and the solicitation of
the vote or consent of, the Holders thereof, and for any and all
other matters incidental thereto; or (h) to evidence and provide
for the acceptance of appointment of a successor Indenture
Trustee or co-trustee with respect to the Debt Securities of one
or more series and to add to or change any of the provisions of
such Indenture as shall be necessary to provide for or to
facilitate the administration of the trusts under such Indenture
by more than one trustee; or (i) to provide for the procedures
required to permit the utilization of a noncertificated system of
registration for the Debt Securities of all or any series or
Tranche; or (j) to change any place where (1) the principal of
and premium, if any, and interest, if any, on all or any series
or Tranche of Debt Securities shall be payable, (2) all or any
series or Tranche of Debt Securities may be surrendered for
registration of transfer or exchange and (3) notices and demands
to or upon the Company in respect of Debt Securities and such
Indenture may be served; or (k) to cure any ambiguity or
inconsistency or to add or change any other provisions with
respect to matters and questions arising under an Indenture,
provided such changes or additions shall not adversely affect the
interests of the Holders of Debt Securities of any series or
Tranche Outstanding under such Indenture in any material respect
(Indenture, Section 1201).
The Holders of a majority in aggregate principal amount of
the Debt Securities of all series then Outstanding under an
Indenture may waive compliance by the Company with certain
restrictive provisions of such Indenture (Indenture, Section
607). The Holders of not less than a majority in principal
amount of the Outstanding Debt Securities of any series may waive
any past default under an Indenture with respect to such series,
except a default in the payment of principal, premium, or
interest and certain covenants and provisions of such Indenture
that cannot be modified or be amended without the consent of the
Holder of each Outstanding Debt Security of such series affected
(Indenture, Section 813).
Without limiting the generality of the foregoing, if the
Trust Indenture Act is amended after the date of an Indenture in
such a way as to require changes to such Indenture or the
incorporation therein of additional provisions or so as to permit
changes to, or the elimination of, provisions which, at the date
of such Indenture or at any time thereafter, were required by the
Trust Indenture Act to be contained in such Indenture, such
Indenture will be deemed to have been amended so as to conform to
such amendment of the Trust Indenture Act or to effect such
changes, additions or elimination, and the Company and the
Indenture Trustee may, without the consent of any Holders, enter
into one or more supplemental indentures to evidence or effect
such amendment (Indenture, Section 1201).
Except as provided above, the consent of the Holders of a
majority in aggregate principal amount of the Debt Securities of
all series then Outstanding under an Indenture, considered as one
class, is required for the purpose of adding any provisions to,
or changing in any manner, or eliminating any of the provisions
of, such Indenture or modifying in any manner the rights of the
Holders of such Debt Securities under such Indenture pursuant to
one or more supplemental indentures; provided, however, that if
less than all of the series of Debt Securities Outstanding under
an Indenture are directly affected by a proposed supplemental
indenture, then the consent only of the Holders of a majority in
aggregate principal amount of Outstanding Debt Securities of all
series under such Indenture so directly affected, considered as
one class, shall be required; and provided, further, that if the
Debt Securities of any series shall have been issued in more than
one Tranche and if the proposed supplemental indenture shall
directly affect the rights of the Holders of Debt Securities of
one or more, but less than all, of such Tranches, then the
consent only of the Holders of a majority in aggregate principal
amount of the Outstanding Debt Securities of all Tranches of such
series so directly affected, considered as one class, will be
required; and provided further, that no such amendment or
modification may (a) change the Stated Maturity of the principal
of, or any installment of principal of or interest on, any Debt
Security, or reduce the principal amount thereof or the rate of
10
<PAGE>
interest thereon (or the amount of any installment of interest
thereon) or change the method of calculating such rate or reduce
any premium payable upon the redemption thereof, or change the
coin or currency (or other property) in which any Debt Security
or any premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment
on or after the Stated Maturity of any Debt Security (or, in the
case of redemption, on or after the redemption date) without, in
any such case, the consent of the Holder of such Debt Security,
(b) reduce the percentage in principal amount of the Outstanding
Debt Securities of any series, or any Tranche thereof, the
consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is
required for any waiver of compliance with any provision of such
Indenture or any default thereunder and its consequences, or
reduce the requirements for quorum or voting, without, in any
such case, the consent of the Holder of each outstanding Debt
Security of such series or Tranche, or (c) modify certain of the
provisions of such Indenture relating to supplemental indentures,
waivers of certain covenants and waivers of past defaults with
respect to the Debt Securities of any series or Tranche, without
the consent of the Holder of each Outstanding Debt Security under
such Indenture affected thereby. A supplemental indenture which
changes or eliminates any covenant or other provision of an
Indenture which has expressly been included solely for the
benefit of one or more particular series of Debt Securities or
one or more Tranches thereof, or modifies the rights of the
Holders of Debt Securities of such series with respect to such
covenant or other provision, will be deemed not to affect the
rights under such Indenture of the Holders of the Debt Securities
of any other series or Tranche (Indenture, Section 1202).
Each Indenture provides that in determining whether the
Holders of the requisite principal amount of the Outstanding Debt
Securities have given any request, demand, authorization,
direction, notice, consent or waiver under such Indenture, or
whether a quorum is present at the meeting of the Holders of Debt
Securities, Debt Securities owned by the Company or any other
obligor upon the Debt Securities or any affiliate of the Company
or of such other obligor (unless the Company, such affiliate or
such obligor owns all Debt Securities Outstanding under such
Indenture, determined without regard to this provision) shall be
disregarded and deemed not to be Outstanding.
If the Company shall solicit from Holders any request,
demand, authorization, direction, notice, consent, election,
waiver or other Act, the Company may, at its option, fix in
advance a record date for the determination of Holders entitled
to give such request, demand, authorization, direction, notice,
consent, waiver or other such Act, but the Company shall have no
obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business on
such record date shall be deemed to be Holders for the purposes
of determining whether Holders of the requisite proportion of the
Outstanding Debt Securities have authorized or agreed or
consented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose the
Outstanding Debt Securities shall be computed as of the record
date. Any request, demand, authorization, direction, notice,
consent, election, waiver or other Act of a Holder shall bind
every future Holder of the same Debt Security and the Holder of
every Debt Security issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by an Indenture
Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Debt Security
(Indenture, Section 104).
Resignation of an Indenture Trustee. An Indenture Trustee
may resign at any time by giving written notice thereof to the
Company or may be removed at any time with respect to the
respective Indenture by Act of the Holders of a majority in
principal amount of all series of Debt Securities then
Outstanding under such Indenture delivered to such Indenture
Trustee and the Company. No resignation or removal of an
Indenture Trustee and no appointment of a successor trustee will
become effective until the acceptance of appointment by a
successor trustee in accordance with the requirements of the
respective Indenture. So long as no Event of Default or event
which, after notice or lapse of time, or both, would become an
Event of Default has occurred and is continuing and except with
respect to an Indenture Trustee appointed by Act of the Holders,
if the Company has delivered to the Indenture Trustee a
11
<PAGE>
resolution of its Board of Directors appointing a successor
trustee and such successor has accepted such appointment in
accordance with the terms of the respective Indenture, such
Indenture Trustee will be deemed to have resigned and the
successor will be deemed to have been appointed as trustee in
accordance with such Indenture (Indenture, Section 910).
Notices. Notices to Holders of Debt Securities will be
given by mail to the addresses of such Holders as they may appear
in the security register therefor (Indenture, Section 106).
Title. The Company, the respective Indenture Trustee, and
any agent of the Company or such Indenture Trustee, may treat the
Person in whose name Debt Securities are registered as the
absolute owner thereof (whether or not such Debt Securities may
be overdue) for the purpose of making payments and for all other
purposes irrespective of notice to the contrary (Indenture,
Section 308).
Governing Law. Each Indenture and the Debt Securities will
be governed by, and construed in accordance with, the laws of the
State of New York (Indenture, Section 112).
Regarding the Indenture Trustee. The Indenture Trustee
under the first Indenture will be The Bank of New York. In
addition to acting as Indenture Trustee, The Bank of New York
acts, and may act, as trustee under various indentures and trusts
of the Company and its affiliates including, but not limited to,
the Trust Agreement, Subordinated Indenture and Guarantee, each
as described herein. The Company and its affiliates also
maintain various banking and trust relationships with The Bank of
New York.
EXPERTS AND LEGALITY
The consolidated financial statements included in the latest
Annual Report of the Company on Form 10-K, incorporated herein by
reference, have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their report included in said
latest Annual Report of the Company on Form 10-K, and have been
incorporated by reference herein in reliance upon such report
given upon authority of the firm as experts in accounting and
auditing.
With respect to any unaudited condensed consolidated interim
financial information included in the Company's Quarterly Reports
on Form 10-Q which are or will be incorporated herein by
reference, Deloitte & Touche LLP has applied limited procedures
in accordance with professional standards for reviews of such
information. As stated in any of their reports included in the
Company's Quarterly Reports on Form 10-Q, which are or will be
incorporated herein by reference, Deloitte & Touche LLP did not
audit and did not express an opinion on such interim financial
information. Deloitte & Touche LLP is not subject to the
liability provisions of Section 11 of the 1933 Act for any of
their reports on such unaudited condensed consolidated interim
financial information because such reports are not "reports" or a
"part" of the Registration Statement filed under the 1933 Act
with respect to the Securities prepared or certified by an
accountant within the meaning of Sections 7 and 11 of the 1933
Act.
The legality of the Debt Securities offered hereby will be
passed upon for the Company by Worsham, Forsythe & Wooldridge,
L.L.P., Dallas, Texas and by Reid & Priest LLP, New York, New
York, and for the Underwriters by Winthrop, Stimson, Putnam &
Roberts, New York, New York. However, all matters pertaining to
incorporation of the Company and all other matters of Texas law
will be passed upon only by Worsham, Forsythe & Wooldridge,
L.L.P. At October 31, 1997, members of the firm of Worsham,
Forsythe & Wooldridge, L.L.P. owned approximately 41,200 shares
of the common stock of Texas Utilities, which owns all of the
common stock of the Company.
12
<PAGE>
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities in any of three
ways: (i) through underwriters or dealers; (ii) directly to a
limited number of purchasers or to a single purchaser; or (iii)
through agents. The Prospectus Supplement with respect to the
Offered Debt Securities sets forth the terms of the offering of
the Offered Debt Securities, including the name or names of any
underwriters, dealers or agents, the purchase price of such
Offered Debt Securities and the proceeds to the Company from such
sale, any underwriting discounts and other items constituting
underwriters' compensation, any initial public offering price and
any discounts or concessions allowed or reallowed or paid to
dealers. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be
changed from time to time.
If underwriters are used in the sale, the Offered Debt
Securities will be acquired by the underwriters for their own
account and may be resold from time to time in one or more
transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time
of the sale. The underwriter or underwriters with respect to a
particular underwritten offering of Offered Debt Securities are
named in the Prospectus Supplement relating to such offering and,
if an underwriting syndicate is used, the managing underwriter or
underwriters are set forth on the cover page of such Prospectus
Supplement. Unless otherwise set forth in the Prospectus
Supplement, the obligations of the underwriters to purchase the
Offered Debt Securities will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all
such Offered Debt Securities if any are purchased.
Subject to certain conditions, the Company may agree to
indemnify the several underwriters or agents and their
controlling persons against certain liabilities, including
liabilities under the 1933 Act arising out of or based upon,
among other things, any untrue statement or alleged untrue
statement of a material fact contained in the registration
statement, this Prospectus, a Prospectus Supplement or the
Incorporated Documents or the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. See the
applicable Prospectus Supplement.
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO
GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN
THOSE CONTAINED IN THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT
IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND ANY
PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY OTHER PERSON, UNDERWRITER, DEALER OR AGENT.
NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE
IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF.
THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT DOES NOT CONSTITUTE
AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE
PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO
SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
13
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PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article 2.02-1 of the Texas Business Corporation Act permits
the Company, in certain circumstances, to indemnify any present
or former director, officer, employee or agent of the Company
against judgments, penalties, fines, settlements and reasonable
expenses incurred in connection with a proceeding in which any
such person was, is or is threatened to be, made a party by
reason of holding such office or position, but only to a limited
extent for obligations resulting from a proceeding in which the
person is found liable on the basis that a personal benefit was
improperly received or in circumstances in which the person is
found liable in a derivative suit brought on behalf of the
Company.
Article Eight of the Restated Articles of Incorporation of
the Company, as amended, provides as follows:
"No director of this Corporation shall be liable to
this Corporation or its shareholders for monetary damages
for an act or omission in such director's capacity as a
director of this Corporation, except this Article Eight does
not eliminate or limit the liability of a director of this
Corporation for (1) a breach of the director's duty of
loyalty to this Corporation or its shareholders, (2) an act
or omission not in good faith or that involves intentional
misconduct or a knowing violation of the law, (3) a
transaction from which the director received an improper
benefit, whether or not the benefit resulted from an action
taken within the scope of the director's office, (4) an act
or omission for which the liability of the director is
expressly provided for by statute, or (5) an act related to
an unlawful stock repurchase or payment of a dividend.
Section 1 of Article XIII of the Company's Bylaws is as
follows:
"Section 1. The corporation shall indemnify any person
who (1) is or was a director, officer, employee or agent of
the corporation, or (2) while a director, officer, employee
or agent of the corporation, its divisions or subsidiaries,
is or was serving at the request of the corporation,
pursuant to a resolution adopted by the Board of Directors,
as a director, officer, partner, venturer, proprietor,
trustee, employee, agent or similar functionary of another
foreign or domestic corporation, partnership, joint venture,
sole proprietorship, trust, employee benefit plan or other
enterprise, to the fullest extent that a corporation may or
is required to grant indemnification to a director under the
Texas Business Corporation Act. The corporation, pursuant
to a resolution adopted by the Board of Directors, may
indemnify any such person to such further extent as
permitted by law."
The Company has entered into agreements with certain of its
officers and directors which provide, among other things, for
their indemnification by the Company to the fullest extent
permitted by Texas law.
The Company has insurance covering its expenditures which
might arise in connection with its lawful indemnification of its
directors and officers for their liabilities and expenses.
Directors and officers of the Company also have insurance which
insures them against certain other liabilities and expenses.
II-1
<PAGE>
ITEM 16. EXHIBITS.
PREVIOUSLY FILED*
------------------------
WITH FILE AS
EXHIBIT NUMBER EXHIBIT
------- --------- -------
1(a) -- Form of Underwriting
Agreement for Debt
Securities.
1(b)** -- Form of Distribution
(Sales Agency)
Agreement.
4(a)-1 1-3183 Form 10-K 3.1 -- Restated Articles of
December 31, 1996 Incorporation of the
Company, as amended
through December 31,
1996.
4(a)-2 333-43811 and 4(a)-2 -- Articles of Merger of
333-43811-01 Lone Star Energy
Company with and into
the Company.
4(a)-3 333-43811 and 4(a)-3 -- Articles of Merger of
333-43811-01 Enserch Exploration
Holdings, Inc. with
and into the Company.
4(a)-4 333-43811 and 4(a)-4 -- Assumed Name
333-43811-01 Certificate re. Lone
Star Energy Company.
4(a)-5a 333-43811 and 4(a)-5a -- Articles of Merger of
333-43811-01 ENSERCH Merger Corp.
with and into the
Company.
4(a)-5b 333-12391 2(a) - Annex I to Articles of
Merger of ENSERCH
Merger Corp. with and
into the Company
(Amended and Restated
Agreement and Plan of
Merger dated as of
April 13, 1996 by and
among the Company,
Texas Utilities and
TEI).
4(b) 1-3183 Form 10-K 3.2 -- Bylaws of the Company,
December 31, 1994 as amended.
4(c) 333-43811 and 4(c) -- Form of Indenture (For
333-43811-01 Unsecured Debt
Securities) between
the Company and The
Bank of New York,
Trustee.
4(d) 333-43811 and 4(d) -- Form of Officer's
333-43811-01 Certificate,
establishing the Debt
Securities, with Form
of Debt Security
attached.
5(a) -- Opinion of Worsham,
Forsythe & Wooldridge,
L.L.P., General
Counsel for the
Company.
5(b) -- Opinion of Reid &
Priest LLP, of Counsel
to the Company.
12 -- Computation of Ratio
of Earnings to Fixed
Charges of the
Company.
15 -- Letter of Deloitte &
Touche LLP regarding
unaudited condensed
interim financial
information.
23(a) -- Independent Auditors'
Consent.
23(b) -- Consents of Worsham,
Forsythe & Wooldridge,
L.L.P., Reid & Priest
LLP, are contained in
Exhibits 5(a) and
5(b), respectively.
24 -- Power of Attorney (see
Page II-4).
II-2
<PAGE>
25(a) -- Statement on Form T-1
of The Bank of New
York with respect to
the Indenture of the
Company.
-----------------------------------------
*Incorporated herein by reference.
**To be filed by amendment.
II-3
<PAGE>
POWER OF ATTORNEY
Each director, and/or officer of ENSERCH Corporation whose
signature appears below hereby appoints the Agents for Service
named in this registration statement, and each of them severally,
as his attorney-in-fact to sign in his name and behalf, in any
and all capacities stated below, and to file with the Securities
and Exchange Commission, any and all amendments, including post-
effective amendments, to this registration statement, and each
registrant hereby also appoints each such Agent for Service as
its attorney-in-fact with like authority to sign and file any
such amendments in its name and on its behalf.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-3 and has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Dallas, and State of Texas, on the 15th day of
January, 1998.
ENSERCH CORPORATION
By: /s/ Erle Nye
--------------------------------
(Erle Nye, Chairman of the Board
and Chief Executive)
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed below by the
following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Erle Nye Principal
--------------------------- Executive January 15, 1998
(Erle Nye, Chairman of Officer and
the Board and Chief Director
Executive)
/s/ Robert S. Shapard Principal January 15, 1998
--------------------------- Financial
(Robert S. Shapard) Officer
/s/ Jerry W. Pinkerton Principal January 15, 1998
--------------------------- Accounting
(Jerry W. Pinkerton) Officer
/s/ D. W. Biegler Director January 15, 1998
---------------------------
(D. W. Biegler)
/s/ Barbara Curry Director January 15, 1998
---------------------------
(Barbara Curry)
/s/ H. Jarrell Gibbs Director January 15, 1998
---------------------------
(H. Jarrell Gibbs)
/s/ Michael J. McNally Director January 15, 1998
---------------------------
(Michael J. McNally)
/s/ Robert A. Wooldridge Director January 15, 1998
----------------------------
(Robert A. Wooldridge)
II-4
<PAGE>
EXHIBIT INDEX
PREVIOUSLY FILED*
------------------------
WITH FILE AS
EXHIBIT NUMBER EXHIBIT
------- --------- -------
1(a) -- Form of Underwriting
Agreement for Debt
Securities.
1(b)** -- Form of Distribution
(Sales Agency)
Agreement.
4(a)-1 1-3183 Form 10-K 3.1 -- Restated Articles of
December 31, 1996 Incorporation of the
Company, as amended
through December 31,
1996.
4(a)-2 333-43811 and 4(a)-2 -- Articles of Merger of
333-43811-01 Lone Star Energy
Company with and into
the Company.
4(a)-3 333-43811 and 4(a)-3 -- Articles of Merger of
333-43811-01 Enserch Exploration
Holdings, Inc. with
and into the Company.
4(a)-4 333-43811 and 4(a)-4 -- Assumed Name
333-43811-01 Certificate re. Lone
Star Energy Company.
4(a)-5a 333-43811 and 4(a)-5a -- Articles of Merger of
333-43811-01 ENSERCH Merger Corp.
with and into the
Company.
4(a)-5b 333-12391 2(a) - Annex I to Articles of
Merger of ENSERCH
Merger Corp. with and
into the Company
(Amended and Restated
Agreement and Plan of
Merger dated as of
April 13, 1996 by and
among the Company,
Texas Utilities and
TEI).
4(b) 1-3183 Form 10-K 3.2 -- Bylaws of the Company,
December 31, 1994 as amended.
4(c) 333-43811 and 4(c) -- Form of Indenture (For
333-43811-01 Unsecured Debt
Securities) between
the Company and The
Bank of New York,
Trustee.
4(d) 333-43811 and 4(d) -- Form of Officer's
333-43811-01 Certificate,
establishing the Debt
Securities, with Form
of Debt Security
attached.
5(a) -- Opinion of Worsham,
Forsythe & Wooldridge,
L.L.P., General
Counsel for the
Company.
5(b) -- Opinion of Reid &
Priest LLP, of Counsel
to the Company.
12 -- Computation of Ratio
of Earnings to Fixed
Charges of the
Company.
15 -- Letter of Deloitte &
Touche LLP regarding
unaudited condensed
interim financial
information.
23(a) -- Independent Auditors'
Consent.
23(b) -- Consents of Worsham,
Forsythe & Wooldridge,
L.L.P., Reid & Priest
LLP, are contained in
Exhibits 5(a) and
5(b), respectively.
24 -- Power of Attorney (see
Page II-4).
25(a) -- Statement on Form T-1
of The Bank of New
York with respect to
the Indenture of the
Company.
-----------------------------------------
*Incorporated herein by reference.
**To be filed by amendment.
Exhibit 1(a)
ENSERCH Corporation
Unsecured Debt Securities
UNDERWRITING AGREEMENT
----------------------
[Date]
as Representatives of the Underwriters
named in Schedule I hereto
c/o
Ladies and Gentlemen:
1. Introduction. ENSERCH Corporation, a Texas
------------
corporation (the "Company"), proposes to issue and sell severally
to you (the "Underwriters"): the Company's unsecured debt
securities of the series designation, with the terms and in the
principal amount specified in Schedule I hereto (the "Debt
Securities").
2. Description of Debt Securities. The Company
------------------------------
proposes to issue the Debt Securities under its Indenture (for
Unsecured Debt Securities), dated as of _________, ____, to The
Bank of New York, Trustee (the "Indenture Trustee"), said
Indenture, together with any amendments or supplements thereto,
being hereinafter referred to as the "Indenture".
3. Representations and Warranties of the Company.
---------------------------------------------
The Company represents and warrants to the several Underwriters
that:
(a) It has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on
Form S-3, as amended by Amendments Nos. 1 and 2 thereto,
including a prospectus, on April 5, 1994 (Registration No.
33-52525) ("Original Registration Statement") for the
registration of $450,000,000 aggregate amount of the Company's
debt securities, Preferred Stock, Depositary Shares and Common
Stock and the Preferred Securities ("LLC Securities") of the
Company's affiliate, ENSERCH Capital L.L.C. and the Backup
Undertakings of the Company and its subsidiary, Enserch
Preferred Capital, Inc. with respect to the LLC Securities
("Backup Undertakings"), under the Securities Act of 1933,
as amended (the "Securities Act"). Such registration
statement was declared effective by the Commission on April
5, 1994. The Company also filed with the Commission post-
effective amendment no. 1 (the "Post-Effective Amendment")
to the Original Registration Statement on January , 1998
to withdraw from registration the LLC Securities and the
Backup Undertakings and to amend the terms of the debt
securities registered with the Commission pursuant to the
Original Registration Statement. The Post-Effective
Amendment was declared effective by the Commission on
January , 1997. References herein to the term
"Registration Statement" as of any date shall be deemed to
refer to the Original Registration Statement, as amended or
supplemented to such date, including all documents
incorporated by reference therein as of such date pursuant
to Item 12 of Form S-3 ("Incorporated Documents").
References herein to the term "Prospectus" as of any given
date shall be deemed to refer to the prospectus forming a
part of the Post-Effective Amendment, as amended or
supplemented as of such date, including all Incorporated
Documents as of such date. References herein to the term
"Effective Date" shall be deemed to refer to the time and
date the Post Effective Amendment was declared effective.
The Company will not file any amendment to the Registration
Statement or supplement to the Prospectus on or after the
date of this Agreement and prior to the Closing Date, as
hereinafter defined, without prior notice to the
Underwriters, or to which Counsel for the Underwriters shall
reasonably object in writing. For the purposes of this
Agreement, any Incorporated Document filed with the
Commission on or after the date of this Agreement and prior
to the Closing Date, as hereinafter defined, shall be deemed
an amendment or supplement to the Registration Statement and
the Prospectus.
(b) On the Effective Date, the Registration Statement
and the Prospectus fully complied and at the Closing Date,
as hereinafter defined, the Registration Statement, the
Prospectus and the Indenture will fully comply in all
material respects with the applicable provisions of the
Securities Act, the Trust Indenture Act of 1939, as amended
("Trust Indenture Act"), and the applicable rules and regu-
lations of the Commission thereunder; on the Effective Date
the Registration Statement did not, and at the Closing Date,
as hereinafter defined, the Registration Statement will not,
contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading; on
the Effective Date the Prospectus did not, and at the
Closing Date, as hereinafter defined, and on the date it is
filed with, or transmitted for filing to, the Commission
pursuant to Rule 424 of the General Rules and Regulations of
the Securities Act ("Rule 424"), the Prospectus will not,
contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; and on said dates the
Incorporated Documents, taken together as a whole, fully
complied or will comply in all material respects with the
applicable provisions of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the applicable
rules and regulations of the Commission thereunder, and,
when read together with the Prospectus on said dates did not
and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading; provided that the foregoing representations and
warranties in this paragraph (b) shall not apply to
statements or omissions made in reliance upon information
furnished in writing to the Company by, or on behalf of, any
Underwriter for use in connection with the preparation of
the Registration Statement or the Prospectus or to any
statements in or omissions from the Statements of
Eligibility and Qualification under the Trust Indenture Act,
or amendments thereto, filed as exhibits to the Registration
Statement.
(c) The consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will
not result in a breach of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed
of trust or other agreement or instrument to which the
Company is now a party.
4. Purchase and Sale. On the basis of the
-----------------
representations and warranties herein contained, and subject to
the terms and conditions herein set forth, the Company shall sell
to each of the Underwriters, and each Underwriter shall purchase
from the Company, at the time and place herein specified,
severally and not jointly, the respective principal amount(s) of
the Debt Securities set forth opposite the name of such
Underwriter in Schedule II attached hereto, at the purchase price
or prices set forth in Schedule I hereto.
5. Time and Place of Closing. Delivery of the Debt
-------------------------
Securities against payment therefor by wire transfer in federal
funds shall be made at the office of Reid & Priest LLP, 40 West
57th Street, New York, New York, at 10:00 A.M., New York Time, on
_____________, or at such other place, time and date as shall be
agreed upon in writing by the Company and you or established in
accordance with the following paragraph. The hour and date of
such delivery and payment are herein called the "Closing Date".
The Debt Securities shall be delivered to you for the respective
accounts of the Underwriters in fully registered form in such
denominations of $1,000 or any multiple thereof and registered in
such names as you shall reasonably request in writing not later
than the close of business on the second business day prior to
the Closing Date, or, to the extent not so requested, registered
in the names of the respective Underwriters in such authorized
denominations as the Company shall determine. The Company agrees
to make the Debt Securities available to you for checking
purposes not later than 10:00 A.M., New York Time, on the last
business day preceding the Closing Date at the office of Reid &
Priest LLP, 40 West 57th Street, New York, New York, 10019.
If any Underwriter shall fail or refuse (otherwise than
for some reason sufficient to justify, in accordance with the
terms hereof, the cancellation or termination of its obligations
hereunder) to purchase and pay for the principal amount(s) of the
Debt Securities that such Underwriter has agreed to purchase and
pay for hereunder, the Company shall immediately give notice to
the other Underwriters of the default of such Underwriter, and
the other Underwriters shall have the right within 24 hours after
the receipt of such notice to determine to purchase, or to
procure one or more others, who are members of the National
Association of Securities Dealers, Inc. ("NASD") (or, if not
members of the NASD, who are not eligible for membership in the
NASD and who agree (i) to make no sales within the United States,
its territories or its possessions or to persons who are citizens
thereof or residents therein and (ii) in making sales to comply
with the NASD's Rules of Fair Practice) and satisfactory to the
Company, to purchase, upon the terms herein set forth, the
principal amount(s) of the Debt Securities that the defaulting
Underwriter had agreed to purchase. If any non-defaulting
Underwriter or Underwriters shall determine to exercise such
right, such Underwriter or Underwriters shall give written notice
to the Company of the determination in that regard within 24
hours after receipt of notice of any such default, and thereupon
the Closing Date shall be postponed for such period, not
exceeding three business days, as the Company shall determine.
If in the event of such a default no non-defaulting Underwriter
shall give such notice then this Agreement may be terminated by
the Company, upon like notice given to the non-defaulting
Underwriters, within a further period of 24 hours. If in such
case the Company shall not elect to terminate this Agreement it
shall have the right, irrespective of such default:
(a) to require such non-defaulting Underwriters to
purchase and pay for the respective principal amounts of the
Debt Securities that they had severally agreed to purchase
hereunder as hereinabove provided and, in addition, the
principal amounts of the Debt Securities that the defaulting
Underwriter shall have so failed to purchase up to a
principal amount thereof equal to one-ninth (1/9) of the
respective principal amounts of the Debt Securities that
such non-defaulting Underwriters have otherwise agreed to
purchase hereunder, and/or
(b) to procure one or more persons, who are members of
the NASD (or, if not members of the NASD, who are not
eligible for membership in the NASD and who agree (i) to
make no sales within the United States, its territories or
its possessions or to persons who are citizens thereof or
residents therein and (ii) in making sales to comply with
the NASD's Rules of Fair Practice), to purchase, upon the
terms herein set forth, either all or a part of the princi-
pal amount(s) of the Debt Securities that such defaulting
Underwriter had agreed to purchase or that portion thereof
that the remaining Underwriters shall not be obligated to
purchase pursuant to the foregoing clause (a).
In the event the Company shall exercise its rights under (a)
and/or (b) above, the Company shall give written notice thereof
to the non-defaulting Underwriters within such further period of
24 hours, and thereupon the Closing Date shall be postponed for
such period, not exceeding three business days, as the Company
shall determine.
In the computation of any period of 24 hours referred
to in this Section 5, there shall be excluded a period of 24
hours in respect of each Saturday, Sunday or legal holiday that
would otherwise be included in such period of time.
Any action taken by the Company under this Section 5
shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
Termination by the Company under this Section 5 shall be without
any liability on the part of the Company or any non-defaulting
Underwriter, except as otherwise provided in Sections 6(g) and 9
hereof.
6. Covenants of the Company. The Company agrees
------------------------
that:
(a) It will promptly deliver to each of you a signed
copy of the Registration Statement as originally filed or,
to the extent a signed copy is not available, a conformed
copy, certified by an officer of the Company to be in the
form as originally filed, including all Incorporated
Documents and exhibits and of all amendments thereto.
(b) It will deliver to you, as soon as practicable
after the date hereof, as many copies of the Prospectus as
of such date as you may reasonably request.
(c) It will cause the Prospectus to be filed with, or
transmitted for filing to, the Commission pursuant to Rule
424 as soon as practicable and advise you of the issuance of
any stop order under the Securities Act with respect to the
Registration Statement or the institution of any proceedings
therefor of which the Company shall have received notice.
The Company will use its best efforts to prevent the
issuance of any such stop order and to secure the prompt
removal thereof if issued.
(d) If, during such period of time (not exceeding nine
months) after the Prospectus has been filed with, or
transmitted for filing to, the Commission pursuant to Rule
424 as in the opinion of Counsel for the Underwriters a
prospectus covering the Debt Securities is required by law
to be delivered in connection with sales by an Underwriter
or dealer, any event relating to or affecting the Company or
of which the Company shall be advised in writing by you
shall occur that in the Company's reasonable opinion should
be set forth in a supplement to, or an amendment of, the
Prospectus in order to make the Prospectus not misleading in
the light of the circumstances when it is delivered to a
purchaser, the Company will, at its expense, amend or
supplement the Prospectus by either (i) preparing and
furnishing to you at the Company's expense a reasonable
number of copies of a supplement or supplements or an
amendment or amendments to the Prospectus or (ii) making an
appropriate filing pursuant to Section 13 of the Exchange
Act, which will supplement or amend the Prospectus so that,
as supplemented or amended, it will not contain any untrue
statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in
the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading; provided that
should such event relate solely to the activities of any of
the Underwriters, then the Underwriters shall assume the
expense of preparing and furnishing any such amendment or
supplement. In case any Underwriter is required to deliver
a prospectus after the expiration of nine months from the
date the Prospectus is filed with, or transmitted for filing
to, the Commission pursuant to Rule 424, the Company, upon
your request, will furnish to you, at the expense of such
Underwriter, a reasonable quantity of a supplemental
prospectus or supplements to the Prospectus complying with
Section 10(a) of the Securities Act.
(e) It will make generally available to its security
holders, as soon as practicable, an earnings statement
(which need not be audited) covering a period of at least
twelve months beginning not earlier than the first day of
the month next succeeding the month in which occurred the
effective date of the Registration Statement as defined in
Rule 158 under the Securities Act.
(f) It will furnish such proper information as may be
lawfully required and otherwise cooperate in qualifying the
Debt Securities for offer and sale under the blue-sky laws
of such jurisdictions as you may designate, provided that
the Company shall not be required to qualify as a foreign
corporation or dealer in securities, to file any consents to
service of process under the laws of any jurisdiction, or to
meet any other requirements deemed by the Company to be
unduly burdensome.
(g) It will, except as herein provided, pay all
expenses and taxes (except transfer taxes) in connection
with (i) the preparation and filing by it of the
Registration Statement, (ii) the issuance and delivery of
the Debt Securities as provided in Section 5 hereof, (iii)
the qualification of the Debt Securities under blue-sky laws
[(including counsel fees not to exceed $7,500)], and (iv)
the printing and delivery to the Underwriters of reasonable
quantities of the Registration Statement and, except as
provided in Section 6(d) hereof, of the Prospectus. The
Company shall not, however, be required to pay any amount
for any expenses of yours or any of the Underwriters, except
that, if this Agreement shall be terminated in accordance
with the provisions of Section 7, 8 or 10 hereof, the
Company will reimburse you for the fees and disbursements of
Counsel for the Underwriters, whose fees and disbursements
the Underwriters agree to pay in any other event, and will
reimburse the Underwriters for their reasonable out-of-
pocket expenses, in an aggregate amount not exceeding
$5,000, incurred in contemplation of the performance of this
Agreement. The Company shall not in any event be liable to
any of the several Underwriters for damages on account of
loss of anticipated profits.
7. Conditions of Underwriters' Obligations. The
---------------------------------------
obligations of the Underwriters to purchase and pay for the Debt
Securities shall be subject to the accuracy of the
representations and warranties made herein on the part of the
Company, to the performance by the Company of its obligations to
be performed hereunder prior to the Closing Date, and to the
following conditions:
(a) The Prospectus shall have been filed with, or
transmitted for filing to, the Commission pursuant to Rule
424 prior to 6:00 P.M., New York Time, on the second
business day after the date of this Agreement, or such other
time and date as may be approved by you.
(b) No stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no
proceedings for that purpose shall be pending before, or
threatened by, the Commission on the Closing Date; and you
shall have received a certificate, dated the Closing Date
and signed by an officer of the Company, to the effect that
no such stop order is in effect and that no proceedings for
such purpose are pending before, or to the knowledge of the
Company threatened by, the Commission.
(c) On the Closing Date, you shall have received from
Worsham, Forsythe & Wooldridge, L.L.P., General Counsel for
the Company, Reid & Priest LLP, of counsel for the Company,
and Winthrop, Stimson, Putnam & Roberts, Counsel for the
Underwriters, opinions in substantially the form and
substance prescribed in Schedules III, IV and V hereto (i)
with such changes therein as may be agreed upon by the
Company and you, with the approval of Counsel for the
Underwriters, and (ii) if the Prospectus relating to the
Debt Securities shall be supplemented or amended after the
Prospectus shall have been filed with, or transmitted for
filing to, the Commission pursuant to Rule 424, with any
changes therein necessary to reflect such supplementation or
amendment.
(d) On and as of the date hereof you shall have
received from Deloitte & Touche LLP a letter to the effect
that (i) they are independent certified public accountants
with respect to the Company, within the meaning of the
Securities Act and the applicable published rules and
regulations thereunder, (ii) in their opinion, the financial
statements audited by them and included or incorporated by
reference in the Prospectus comply as to form in all
material respects with the applicable accounting
requirements of the Exchange Act and the published rules and
regulations thereunder, (iii) on the basis of a reading of
the unaudited amounts of operating revenues and net income
included or incorporated by reference in the Prospectus and
the related financial statements from which these amounts
were derived, the latest available unaudited financial
statements of the Company and the minute books of the
Company and inquiries of officers of the Company who have
responsibility for financial and accounting matters (it
being understood that the foregoing procedures do not
constitute an audit made in accordance with generally
accepted auditing standards and would not necessarily reveal
matters of significance with respect to the comments made in
such letter, and accordingly that Deloitte & Touche LLP
makes no representation as to the sufficiency of such
procedures for the several Underwriters' purposes), nothing
has come to their attention that caused them to believe that
(A) the unaudited financial statements incorporated by
reference in the Prospectus were not determined in accor-
dance with generally accepted accounting principles applied
on a basis substantially consistent with that of the
corresponding amounts in the latest available audited
financial statements, (B) the unaudited amounts of operating
revenues and net income of the Company included or
incorporated by reference in the Prospectus were not
determined on a basis substantially consistent with that of
the corresponding amounts in the audited statements of
income incorporated by reference in the Prospectus, (C) for
the twelve months ended as of the date of the latest
available financial statements of the Company, there were
any decreases in operating revenues or net income as
compared with the comparable period of the preceding year,
and (D) at a specified date not more than seven days prior
to the date of such letter, there was any change in the
capital stock of the Company, short-term bank loans,
commercial paper, notes payable to Texas Utilities Company
or long-term debt of the Company or decrease in its net
assets, in each case as compared with amounts shown in the
most recent balance sheet incorporated by reference in the
Prospectus, except in all instances for changes or decreases
that the Prospectus discloses have occurred or may occur or
which are occasioned by the declaration of a regular
quarterly dividend or the acquisition of long-term debt for
sinking fund purposes, or that are described in such letter,
and (iv) they have compared the dollar amounts (or
percentages or ratios derived from such dollar amounts) and
other financial information included or incorporated by
reference in the Registration Statement and the Prospectus
as reasonably requested by you (in each case to the extent
that such dollar amounts, percentages and other financial
information are derived from the general accounting records
of the Company subject to the internal controls of the
Company's accounting system or are derived indirectly from
such records by analysis or computation) with the results
obtained from inquiries, a reading of such general
accounting records and other procedures specified in such
letter, and have found such dollar amounts, percentages and
other financial information to be in agreement with such
results, except as otherwise specified in such letter.
(e) Since the most recent dates as of which in-
formation is given in the Registration Statement or the
Prospectus there shall not have been any material adverse
change in the business, property or financial condition of
the Company and, since such dates, there shall not have been
any material transaction entered into by the Company, in
each case other than transactions in the ordinary course of
business and transactions contemplated by the Registration
Statement or Prospectus and at the Closing Date you shall
have received a certificate to such effect dated the Closing
Date and signed by an officer of the Company.
(f) All legal proceedings to be taken in connection
with the issuance and sale of the Debt Securities shall have
been satisfactory in form and substance to Counsel for the
Underwriters.
In case any of the conditions specified above in this
Section 7 shall not have been fulfilled, this Agreement may be
terminated with the consent of Underwriters that have agreed to
purchase in the aggregate 50% or more of the aggregate principal
amount of the Debt Securities and upon notice thereof to the
Company. Any such termination shall be without liability of any
party to any other party except as otherwise provided in Sections
6(g) and 9 hereof.
8. Conditions of Company's Obligations. The
-----------------------------------
obligation of the Company to deliver the Debt Securities shall be
subject to the conditions that the Prospectus shall have been
filed with, or transmitted for filing to, the Commission pursuant
to Rule 424 prior to 6:00 P.M., New York Time, on the second
business day after the date of this Agreement or such other time
and date as may be approved by the Company, and no stop order
suspending the effectiveness of the Registration Statement shall
be in effect at the Closing Date and no proceedings for that
purpose shall be pending before, or threatened by, the Commission
at the Closing Date. In case these conditions shall not have
been fulfilled, this Agreement may be terminated by the Company
upon notice thereof to you. Any such termination shall be
without liability of any party to any other party except as
otherwise provided in Sections 6(g) and 9 hereof.
9. Indemnification.
---------------
(a) The Company shall indemnify, defend and hold
harmless each Underwriter and each person who controls any
Underwriter within the meaning of Section 15 of the
Securities Act from and against any and all losses, claims,
damages or liabilities, joint or several, to which they or
any of them may become subject under the Securities Act or
any other statute or common law and shall reimburse each
such Underwriter and controlling person for any legal or
other expenses (including, to the extent hereinafter
provided, reasonable counsel fees) incurred by them in
connection with investigating any such losses, claims,
damages or liabilities or in connection with defending any
actions, insofar as such losses, claims, damages,
liabilities, expenses or actions arise out of or are based
upon any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or
prospectus prior to the Effective Date, or in the
Registration Statement or the Prospectus, or the omission or
alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein in the light of the circumstances under which they
were made not misleading; provided, however, that the
indemnity agreement contained in this Section 9 shall not
apply to any such losses, claims, damages, liabilities,
expenses or actions arising out of, or based upon, any such
untrue statement or alleged untrue statement, or any such
omission or alleged omission, if such statement or omission
was made in reliance upon information furnished in writing
to the Company by any Underwriter, through you or otherwise,
for use in connection with the preparation of the
Registration Statement or the Prospectus or any amendment or
supplement to either thereof, or arising out of, or based
upon, statements in or omissions from that part of the
Registration Statement that shall constitute the Statements
of Eligibility and Qualification under the Trust Indenture
Act of any Trustee with respect to any indenture qualified
pursuant to the Registration Statement; and provided
further, that the indemnity agreement contained in this
Section 9 shall not inure to the benefit of any Underwriter
(or of any person controlling such Underwriter) on account
of any such losses, claims, damages, liabilities, expenses
or actions arising from the sale of the Debt Securities to
any person if a copy of the Prospectus (exclusive of the
Incorporated Documents) shall not have been given or sent to
such person by or on behalf of such Underwriter with or
prior to the written confirmation of the sale involved
unless, with respect to the delivery of any amendment or
supplement to the Prospectus, the alleged omission or
alleged untrue statement was not corrected in such amendment
or supplement at the time of such written confirmation. The
indemnity agreement of the Company contained in this Section
9 and the representations and warranties of the Company con-
tained in Section 3 hereof shall remain operative and in
full force and effect regardless of any termination of this
Agreement or of any investigation made by or on behalf of
any Underwriter or any such controlling person, and shall
survive the delivery of the Debt Securities.
(b) Each Underwriter shall indemnify, defend and hold
harmless the Company, its officers and directors, and each
person who controls the Company within the meaning of
Section 15 of the Securities Act, from and against any and
all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject
under the Securities Act or any other statute or common law
and shall reimburse each of them for any legal or other
expenses (including, to the extent hereinafter provided,
reasonable counsel fees) incurred by them in connection with
investigating any such losses, claims, damages or
liabilities or in connection with defending any actions,
insofar as such losses, claims, damages, liabilities,
expenses or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or the
Prospectus, or the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, if
such statement or omission was made in reliance upon
information furnished in writing to the Company by or on
behalf of such Underwriter, through you or otherwise, for
use in connection with the preparation of the Registration
Statement or the Prospectus or any amendment or supplement
to either thereof. Each Underwriter hereby furnishes to the
Company in writing expressly for use in the Prospectus (i)
the statements relating to offerings by the Underwriters on
the cover page, (ii) the statements in the first paragraph
on page ___ concerning stabilization and other transactions
by the Underwriters, and (iii) under "Underwriters," the
list of underwriters and statements in the _______,
________, and _____ paragraphs. The indemnity agreement of
the respective Underwriters contained in this Section 9
shall remain operative and in full force and effect
regardless of any termination of this Agreement or of any
investigation made by or on behalf of the Company, its
directors or its officers, any such Underwriter, or any such
controlling person, and shall survive the delivery of the
Debt Securities.
(c) The Company and the several Underwriters each
shall, upon the receipt of notice of the commencement of any
action against it or any person controlling it as aforesaid,
in respect of which indemnity may be sought on account of
any indemnity agreement contained herein, promptly give
written notice of the commencement thereof to the party or
parties against whom indemnity shall be sought hereunder,
but the omission so to notify such indemnifying party or
parties of any such action shall not relieve such
indemnifying party or parties from any liability that it or
they may have to the indemnified party otherwise than on
account of such indemnity agreement. In case such notice of
any such action shall be so given, such indemnifying party
shall be entitled to participate at its own expense in the
defense, or, if it so elects, to assume (in conjunction with
any other indemnifying parties) the defense of such action,
in which event such defense shall be conducted by counsel
chosen by such indemnifying party or parties and
satisfactory to the indemnified party or parties who shall
be defendant or defendants in such action, and such
defendant or defendants shall bear the fees and expenses of
any additional counsel retained by them; but if the
indemnifying party shall elect not to assume the defense of
such action, such indemnifying party will reimburse such
indemnified party or parties for the reasonable fees and
expenses of any counsel retained by them; provided, however,
if the defendants in any such action include both the
indemnified party and the indemnifying party and counsel for
the indemnifying party shall have reasonably concluded that
there may be a conflict of interest involved in the
representation by such counsel of both the indemnifying
party and the indemnified party, the indemnified party or
parties shall have the right to select separate counsel,
satisfactory to the indemnifying party, to participate in
the defense of such action on behalf of such indemnified
party or parties (it being understood, however, that the
indemnifying party shall not be liable for the expenses of
more than one separate counsel representing the indemnified
parties who are parties to such action).
(d) If the indemnification provided for in sub-
paragraph (a) or (b) above shall be unenforceable under
applicable law by an indemnified party, each indemnifying
party agrees to contribute to such indemnified party with
respect to any and all losses, claims, damages, liabilities
and expenses for which each such indemnification provided
for in subparagraph (a) or (b) above shall be unenforceable,
in such proportion as shall be appropriate to reflect the
relative fault of each indemnifying party on the one hand
and the indemnified party on the other in connection with
the statements or omissions that have resulted in such
losses, claims, damages, liabilities and expenses, as well
as any other relevant equitable considerations; provided,
however, that no indemnified party guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from
any indemnifying party not guilty of such fraudulent
misrepresentation. Relative fault shall be determined by
reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to
information supplied by such indemnifying party or the
indemnified party and each such party's relative intent,
knowledge, access to information and opportunity to correct
or prevent such untrue statement or omission. The Company
and each of the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subparagraph
(d) were to be determined by pro rata allocation (even if
the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to
above.
10. Termination. This Agreement may be terminated, at
-----------
any time prior to the Closing Date, by you with the consent of
the Underwriters that have agreed to purchase in the aggregate
50% or more of the aggregate principal amount of the Securities
if (a) after the date hereof and at or prior to the Closing Date
there shall have occurred any general suspension of trading in
securities on the New York Stock Exchange or there shall have
been established by the New York Stock Exchange or by the Com-
mission or by any federal or state agency or by the decision of
any court, any general limitation on prices for such trading or
any general restrictions on the distribution of securities, or a
general banking moratorium declared by New York or federal
authorities, or (b) there shall have occurred any new material
(i) outbreak of hostilities or (ii) other national or
international calamity or crisis, including, but not limited to,
an escalation of hostilities that existed prior to the date of
this Agreement, and the effect of any such event specified in
clause (a) or (b) above on the financial markets of the United
States shall be such as to make it impracticable, in the
reasonable judgment of the Underwriters, for the Underwriters to
enforce contracts for the sale of the Debt Securities. This
Agreement may also be terminated at any time prior to the Closing
Date by you with the consent of the Underwriters that have agreed
to purchase in the aggregate 50% or more of the aggregate
principal amount of the Debt Securities, if, in your reasonable
judgment, the subject matter of any amendment or supplement to
the Registration Statement or the Prospectus (other than an
amendment or supplement relating solely to the activity of any
Underwriter or Underwriters) prepared and issued by the Company
after the effectiveness of this Agreement shall have disclosed a
material adverse change in the business, property or financial
condition of the Company that has materially impaired the
marketability of the Debt Securities. Any termination hereof
pursuant to this Section 10 shall be without liability of any
party to any other party except as otherwise provided in Sections
6(g) and 9 hereof.
11. Miscellaneous. THE VALIDITY AND INTERPRETATION OF
-------------
THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK. This Agreement shall inure to the benefit of the Company,
the several Underwriters and, with respect to the provisions of
Section 9 hereof, each director, officer and controlling person
referred to in said Section 9, and their respective successors.
Nothing herein is intended or shall be construed to give to any
other person, firm or corporation any legal or equitable right,
remedy or claim under or in respect of any provision in this
Agreement. The term "successor" as used herein shall not include
any purchaser, as such purchaser, of any of the Debt Securities
from any of the several Underwriters.
12. Notices. All communications hereunder shall be in
-------
writing, and, if to the Underwriters, shall be mailed or
delivered to you at the address set forth above, or, if to the
Company, shall be mailed or delivered to it at 1601 Bryan Street,
Dallas, Texas 75201, Attention: Treasurer.
<PAGE>
If the foregoing is in accordance with your
understanding of our agreement, please indicate your acceptance
thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding
agreement between the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
ENSERCH CORPORATION
By _____________________________
Accepted and delivered as of
the date first above written
BY
By _______________________
<PAGE>
SCHEDULE I
----------
Underwriting Agreement dated:
Underwriters:
Debt Securities:
Designation:
Principal Amount:
Date of Maturity:
Interest Rate:
Purchase Price:
Public Offering Price:
<PAGE>
SCHEDULE II
-----------
ENSERCH Corporation
DEBT SECURITIES
Name Principal Amount
---- ----------------
<PAGE>
SCHEDULE III
[Letterhead of Worsham, Forsythe & Wooldridge, L.L.P.]
[Date]
as Underwriters named in the
Underwriting Agreement, dated,
between ENSERCH CORPORATION
and such Underwriters
c/o
Ladies and Gentlemen:
We have acted as General Counsel to ENSERCH Corporation
(the "Company") in connection with the issuance and sale of
$__________ aggregate principal amount of its _____________ (the
"Debt Securities") pursuant to the Underwriting Agreement dated
__________, ____ among the Company and you (the "Underwriting
Agreement").
Terms not otherwise defined herein are used with the
meanings ascribed to them in the Underwriting Agreement.
In so acting we have participated in or reviewed the
corporate proceedings in connection with the authorization,
execution and delivery of the Underwriting Agreement, the
Indenture and the Debt Securities. We have also examined such
other documents and satisfied ourselves as to such other matters
as we have deemed necessary as a basis for the conclusions of law
contained in the opinions enumerated below. We have relied as to
various questions of fact upon the representations and warranties
of the Company contained in the Underwriting Agreement and, where
deemed appropriate, on certificates of public officials. We have
relied upon a certificate of the Indenture Trustee as to the
authentication of the Debt Securities. In our examination we
have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted
to us as photostatic or certified copies.
Upon the basis of our familiarity with these transactions
and with the affairs and properties of the Company generally, we
are of the opinion that:
i. The Company is a public utility corporation duly
authorized by its articles of incorporation, as amended, to
conduct the business that it is now conducting, is subject, as to
rates and services, to the jurisdiction of certain authorities,
as set forth in the Prospectus, and holds valid and subsisting
franchises, licenses and permits authorizing it to carry on the
utility business in which it is engaged.
ii. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
iii. The Indenture has been duly qualified under the
Trust Indenture Act.
iv. The Debt Securities and the Indenture have been duly
authorized, executed and delivered by the Company, the Debt
Securities are entitled to the benefits of the Indenture, and the
Debt Securities and the Indenture are legal, valid and binding
obligations of the Company enforceable against the Company in
accordance with their terms, subject to the effect of bankruptcy,
insolvency, reorganization, receivership, moratorium and other
laws affecting the rights and remedies of creditors generally and
of general principles of equity.
v. The statements made in the Prospectus under the
captions "Description of the Debt Securities" and "Certain Terms
of the __________", insofar as they purport to constitute
summaries of the terms of the documents referred to therein,
constitute accurate summaries of the terms of such documents in
all material respects.
vi. Other than as stated, referred to or incorporated by
reference in the Registration Statement and the Prospectus, there
are no material pending legal proceedings to which the Company is
a party or of which property of the Company is the subject which
depart from the ordinary routine litigation incident to the kind
of business conducted by the Company, and to our best knowledge
no such proceedings are contemplated.
vii. The Registration Statement, as of the Effective
Date, and the Prospectus, at the time it was filed with (or
transmitted for filing to) the Commission pursuant to Rule 424
under the Securities Act, (except for financial statements and
schedules and financial and statistical data as to which we do
not express any belief and except for those parts of the
Registration Statement that constitute the Forms T-1) complied as
to form in all material respects with the applicable requirements
of the Securities Act and the applicable instructions, rules and
regulations of the Commission thereunder; the Incorporated
Documents (except as to the financial statements and schedules
and other financial and statistical data contained therein, as to
which we do not express any belief), at the time they were filed
with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act and the applicable
instructions, rules and regulations of the Commission thereunder;
and the Registration Statement has become and is effective under
the Securities Act and, to our best knowledge, no proceedings for
a stop order with respect thereto are pending or threatened under
Section 8 of the Securities Act.
viii. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the provisions of the blue-sky laws of any
jurisdiction) is legally required for the authorization of the
issue and sale by the Company of the Debt Securities.
In the course of the preparation of the information
relating to the Company contained in the Registration Statement
and the Prospectus (including the documents incorporated therein
by reference), we had discussions with certain of its officers
and representatives, with other counsel for the Company, with
Deloitte & Touche LLP, the independent certified public
accountants who audited certain of the financial statements
contained in the Registration Statement and the Prospectus and
with certain of your officers and employees and your counsel, but
we made no independent verification of the accuracy or
completeness of the representations and statements made to us by
the Company or the information included by the Company in the
Registration Statement and the Prospectus and take no
responsibility therefor except as set forth in paragraph 5 above.
However, our examination of the information relating to the
Company contained in the Registration Statement and the
Prospectus and our discussions did not disclose to us anything
which gives us reason to believe that (except for financial
statements and schedules and financial and statistical data as to
which we do not express any belief and except for those parts of
the Registration Statement that constitute the Forms T-1) (i) the
Registration Statement, as of the Effective Date, included an
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading or (ii) the Prospectus, at
the time it was filed with (or transmitted for filing to) the
Commission pursuant to Rule 424 under the Securities Act,
included, or on the date hereof includes, an untrue statement of
a material fact or on such dates omitted or omits to state a
material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
We are members of the State Bar of Texas and do not hold
ourselves out as experts in the laws of the State of New York.
As to all matters of New York law, we have, with your consent,
relied upon the opinion of Reid & Priest LLP, New York, New York,
of Counsel to the Company.
Very truly yours,
WORSHAM, FORSYTHE &
WOOLDRIDGE, L.L.P.
By:_________________________
A Partner
<PAGE>
SCHEDULE IV
[Letterhead of Reid & Priest LLP]
[Date]
as Underwriters named in the
Underwriting Agreement, dated,
between ENSERCH Corporation
and such Underwriters
c/o
Ladies and Gentlemen:
We have acted as counsel to ENSERCH Corporation (the
"Company") in connection with the issuance and sale of
$_____________ aggregate principal amount of its __________ (the
"Debt Securities") pursuant to the Underwriting Agreement dated
______________ among the Company and you (the "Underwriting
Agreement").
Terms not otherwise defined herein are used with the
meanings ascribed to them in the Underwriting Agreement.
In so acting we have participated in or reviewed the
corporate proceedings in connection with the authorization,
execution and delivery of the Underwriting Agreement, the
Indenture and the Debt Securities. We have also examined such
other documents and satisfied ourselves as to such other matters
as we have deemed necessary as a basis for the conclusions of law
contained in the opinions expressed below. We have relied as to
various questions of fact upon the representations and warranties
of the Company contained in the Underwriting Agreement and, where
we deemed appropriate, on certificates of public officials. We
have relied upon a certificate of the Indenture Trustee as to the
authentication of the Debt Securities. In our examination we
have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted
to us as photostatic or certified copies.
Upon the basis of our familiarity with these transactions
and with the affairs and properties of the Company generally, we
are of the opinion that:
1. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company;
2. The Indenture has been duly qualified under the
Trust Indenture Act;
3. The Debt Securities and the Indenture have been duly
authorized, executed and delivered by the Company, the Debt
Securities are entitled to the benefits of the Indenture, and the
Debt Securities and the Indenture are legal, valid and binding
obligations of the Company enforceable against the Company in
accordance with their terms, subject to the effect of bankruptcy,
insolvency, reorganization, receivership, moratorium and other
laws affecting the rights and remedies of creditors generally and
of general principles of equity;
4. The statements made in the Prospectus under the
captions "Description of the Debt Securities" and "Certain Terms
of the _________", insofar as they purport to constitute
summaries of the terms of the documents referred to therein,
constitute accurate summaries of the terms of such documents in
all material respects;
5. The Registration Statement, as of the Effective
Date, and the Prospectus, at the time it was filed with the
Commission pursuant to Rule 424 under the Securities Act, (except
as to the financial statements and schedules and other financial
and statistical data contained therein as to which we do not
express any belief and except for those parts of the Registration
Statement that constitute the Forms T-1) complied as to form in
all material respects with the applicable requirements of the
Securities Act and the applicable instructions, rules and
regulations of the Commission thereunder; the Incorporated
Documents (except as to the financial statements and schedules
and other financial and statistical data contained therein, as to
which we do not express any belief), at the time they were filed
with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act and the applicable
instructions, rules and regulations of the Commission thereunder;
and the Registration Statement has become and is effective under
the Securities Act and, to our best knowledge, no proceedings for
a stop order with respect thereto are pending or threatened under
Section 8 of the Securities Act; and
6. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the provisions of the blue-sky laws of any
jurisdiction) is legally required for the authorization of the
issue and sale by the Company of the Debt Securities.
In the course of the preparation of the information
relating to the Company contained in the Registration Statement
and the Prospectus (including the documents incorporated therein
by reference) we had discussions with certain of its officers and
representatives, with other counsel for the Company, with
Deloitte & Touche LLP, the independent certified public
accountants who audited certain of the financial statements
contained in the Registration Statement and the Prospectus and
with certain of your officers and employees and your counsel, but
we made no independent verification of the accuracy or
completeness of the representations and statements made to us by
the Company or the information included by the Company in the
Registration Statement and the Prospectus and take no
responsibility therefor except as set forth in paragraph 4 above.
However, our examination of the information relating to the
Company contained in the Registration Statement and the
Prospectus and our discussions did not disclose to us anything
which gives us reason to believe that (except as to the financial
statements and schedules and other financial and statistical data
contained therein, as to which we do not express any belief, and
except for those parts of the Registration Statement that
constitute the Forms T-1) (i) the Registration Statement, as of
the Effective Date, included an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading or (ii) the Prospectus, at the time it was filed with
the Commission pursuant to Rule 424 under the Securities Act,
included, or on the date hereof includes, an untrue statement of
a material fact or on such dates omitted or omits to state a
material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
We are members of the New York Bar and do not hold
ourselves out as experts in the laws of the State of Texas. As
to all matters of Texas law, we have, with your consent, relied
upon the opinion of Worsham, Forsythe & Wooldridge, L.L.P.,
Dallas, Texas, General Counsel for the Company. We believe that
you and we are justified in relying on such opinion.
Very truly yours,
REID & PRIEST LLP
<PAGE>
SCHEDULE V
[Letterhead of Winthrop, Stimson, Putnam & Roberts]
[Date]
as Underwriters named in the
Underwriting Agreement, dated
, between ENSERCH
Corporation and such Underwriters
c/o
Ladies and Gentlemen:
We have acted as counsel to you in connection with your
purchase from ENSERCH Corporation (the "Company") of $__________
aggregate principal amount of its _______________ (the "Debt
Securities") pursuant to the Underwriting Agreement, dated
______________, between you and the Company (the "Underwriting
Agreement").
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of the State of Texas. We
have, with your consent, relied upon an opinion of even date
herewith addressed to you by Worsham, Forsythe & Wooldridge,
L.L.P., of Dallas, Texas, General Counsel for the Company, as to
the matters covered in such opinion relating to Texas law. We
have reviewed such opinion and believe that it is satisfactory
and that you and we are justified in relying thereon. We have
also reviewed the opinion of Reid & Priest LLP required by
paragraph (c) of Section 7 of the Underwriting Agreement, and we
believe such opinion to be satisfactory.
We have, in addition, examined the documents described in
the list of closing papers as having been delivered to you at the
closing and such other documents and satisfied ourselves as to
such other matters as we have deemed necessary in order to enable
us to express this opinion. We have not examined the Debt
Securities, except specimens thereof, and have relied upon a
certificate of the Trustee as to the authentication thereof. As
to various questions of fact material to this opinion, we have
relied upon representations of the Company and statements in the
Registration Statement hereinafter mentioned. In such
examination we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us and the
genuineness and conformity to original documents of documents
submitted to us as certified or photostatic copies.
"Registration Statement", "Prospectus" and "Effective Date" as
used herein have the same meanings as the same words in the
Underwriting Agreement.
Based on the foregoing, we are of the opinion that:
1. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
2. The Indenture is duly qualified under the 1939 Act.
3. The Debt Securities and the Indenture have been duly
authorized, executed and delivered by the Company, the Debt
Securities are entitled to the benefits of the Indenture, and
the Debt Securities and the Indenture are legal, valid and
binding obligations of the Company enforceable against the
Company in accordance with their terms, subject to the effect
of bankruptcy, insolvency, reorganization, fraudulent
conveyance, receivership, moratorium and other laws affecting
the rights and remedies of creditors generally and of general
principles of equity.
4. The statements made in the Prospectus under the
captions "Description of the Debt Securities" and "Certain
Terms of the __________", insofar as they purport to
constitute summaries of the documents referred to therein,
constitute accurate summaries of the terms of such documents
in all material respects.
5. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the blue-sky laws of any jurisdiction) is
legally required for the authorization of the issue and sale
by the Company of the Debt Securities as contemplated in the
Underwriting Agreement.
6. The Registration Statement, at the Effective Date
thereof, and the Prospectus, at the time it was filed with or
transmitted for filing to the Commission pursuant to Rule 424
(except in each case as to financial statements and schedules
and other financial and statistical data contained or
incorporated by reference therein and except for those parts
of the Registration Statement that constitute the Forms T-1,
upon which we express no opinion), complied as to form in all
material respects with the Securities Act.
In passing upon the form of the Registration Statement
and the form of the Prospectus, we necessarily assume the
correctness and completeness of the statements made by the
Company and the information included in the Registration
Statement and the Prospectus and take no responsibility therefor,
except insofar as such statements relate to us and as set forth
in paragraph 4 above. In the course of the preparation by the
Company of the Registration Statement and the Prospectus, we have
had discussions with certain of its officers and representatives,
with counsel for the Company, with Deloitte & Touche LLP, the
independent public accountants who audited certain of the
financial statements incorporated by reference in the
Registration Statement and the Prospectus, and with certain of
your representatives. Our examination of the Registration
Statement and the Prospectus and our discussions did not disclose
to us any information which gives us reason to believe that at
the Effective Date the Registration Statement contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, at the time it was
filed with or transmitted for filing to the Commission pursuant
to Rule 424, or at the date hereof, included or includes any
untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. We do not express any opinion or belief as
to the financial statements or other financial or statistical
data contained or incorporated by reference in the Registration
Statement or the Prospectus or as to those parts of the
Registration Statement that constitute the Forms T-1.
This opinion is given to you solely for your use in
connection with the Underwriting Agreement and the transactions
contemplated thereunder and may not be relied upon by any other
person or for any other purpose.
Very truly yours,
WINTHROP, STIMSON, PUTNAM
& ROBERTS
Exhibit 5(a)
WORSHAM, FORSYTHE & WOOLDRIDGE, L.L.P.
ATTORNEYS AND COUNSELORS AT LAW
ENERGY PLAZA
1601 BRYAN STREET, 30TH FLOOR
DALLAS, TEXAS 75201
-------------------
TELEPHONE (214) 979-3000
FAX (214) 880-0011
January 15, 1998
ENSERCH Corporation
Energy Plaza
1601 Bryan Street
Dallas, Texas 75201
Ladies and Gentlemen:
Reference is made to Post-Effective Amendment No. 1
(Amendment) to Registration Statement No. 33-52525 on Form S-3
(Registration Statement) to be filed by ENSERCH Corporation
(Company) on or about the date hereof, with the Securities and
Exchange Commission under the Securities Act of 1933, as
amended, which amends the terms of the debt securities (Debt
Securities) of the Company registered pursuant to the
Registration Statement to be issued pursuant to the terms of one
or more indentures (each a Debt Securities Indenture). In
connection therewith, we have reviewed such documents and records
as we have deemed necessary to enable us to express an opinion on
the matters covered hereby.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation validly organized and
existing under the laws of the State of Texas.
2. All requisite action necessary to make any Debt
Securities valid, legal and binding obligations of the Company
will have been taken when:
a. A Debt Securities Indenture with respect to such
Debt Securities shall have been executed and delivered by a duly
authorized officer or representative of the Company and by the
trustee under such Debt Securities Indenture; and
b. The Board of Directors of the Company, or an
officer duly authorized thereby, shall have taken such action,
pursuant to the terms of such Debt Securities Indenture, as may
be necessary to fix and determine the terms of such Debt
Securities, and such Debt Securities shall have been issued and
delivered in accordance with the terms and provisions of such
Debt Securities Indenture.
We are members of the State Bar of Texas and do not hold
ourselves out as experts on the laws of New York. As to all
matters of New York law, we have with your consent relied upon an
opinion of even date herewith addressed to you by Reid & Priest
LLP of New York, New York.
We hereby consent to the filing of this opinion as an
exhibit to the Amendment and to the use of our name as counsel in
the Registration Statement as amended.
Very truly yours,
WORSHAM, FORSYTHE &
WOOLDRIDGE, L.L.P.
By: /s/ Timopthy A. Mack
------------------------
A Partner
REID & PRIEST LLP
40 West 57th Street
New York, NY 10019-4097
Telephone 212 603-2000
Fax 212 603-2001
Exhibit 5(b) and 8
January 15, 1998
ENSERCH Corporation
Energy Plaza
1601 Bryan Street
Dallas, Texas 75201
Ladies and Gentlemen:
Reference is made to Post-Effective Amendment No. 1
(Amendment) to Registration Statement No. 33-52525 on Form S-3
(Registration Statement) to be filed by ENSERCH Corporation
(Company) on or about the date hereof, with the Securities and
Exchange Commission under the Securities Act of 1933, as
amended, which amends the terms of the debt securities (Debt
Securities) of the Company registered pursuant to the
Registration Statement to be issued pursuant to the terms of one
or more indentures (each a Debt Securities Indenture). In
connection therewith, we have reviewed such documents and records
as we have deemed necessary to enable us to express an opinion on
the matters covered hereby.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation validly organized and
existing under the laws of the State of Texas.
2. All requisite action necessary to make any Debt
Securities valid, legal and binding obligations of the Company
will have been taken when:
a. A Debt Securities Indenture with respect to such
Debt Securities shall have been executed and delivered by a duly
authorized officer or representative of the Company and by the
trustee under such Debt Securities Indenture; and
b. The Board of Directors of the Company, or an
officer duly authorized thereby, shall have taken such action,
pursuant to the terms of such Debt Securities Indenture, as may
be necessary to fix and determine the terms of such Debt
Securities, and such Debt Securities shall have been issued and
delivered in accordance with the terms and provisions of such
Debt Securities Indenture.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of Texas. As to all matters
of Texas law, we have with your consent relied upon an opinion of
even date herewith addressed to you by Worsham, Forsythe &
Wooldridge, L.L.P. of Dallas, Texas.
We confirm our opinion as set forth under the caption
"Certain United States Federal Income Tax Consequences Relating
To The Preferred Trust Securities" in the prospectus constituting
a part of the Registration Statement.
We hereby consent to the use of this opinion as an
exhibit to the Registration Statement and to the use of our name
as counsel in the Registration Statement.
Very truly yours,
/s/ Reid & Priest LLP
REID & PRIEST LLP
EXHIBIT 12
ENSERCH CORPORATION AND SUBSIDIARY COMPANIES
(A WHOLLY OWNED SUBSIDIARY OF TEXAS UTILITIES COMPANY)
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED DIVIDENDS
<TABLE>
<CAPTION>
Adjusted (1) Historical (1)
----------------------- -------------------
Period From
Period From January 1,
Nine Acquisition 1997
Months Ended Year Ended Date to through
Sept. 30 Dec. 31 Sept. 30 Acquisition
1997 1996 1997(1) Date (1)
------------ --------- --------- ---------
(In thousands except ratios)
<S> <C> <C> <C> <C>
EARNINGS:
Income (loss) from
continuing operations
before extraordinary
items $(14,384) $ 1,395 $(13,778) $(15,377)
Add: Equity in net
losses (income) of
less-than 50% owned
affiliates 792 3,821 60 732
Dividends received from
less-than 50% owned
affiliates 222 253 44 178
Total federal income
taxes (4,020) 13,124 (6,198) (4,612)
Fixed charges (see
detail below) 57,981 77,517 13,183 45,021
Amortization of
previously capitalized
interest 280 334 63 217
-------- ------- -------- --------
Total earnings(2) $ 40,871 $96,444 $ (6,626) $ 26,159
======== ======= ======== ========
FIXED CHARGES:
Interest expense $ 57,372 $ 76,317 $ 13,058 $ 44,537
Rentals representative
of the interest factor 609 1,200 125 484
-------- -------- -------- --------
Fixed charges deducted
from earnings 57,981 77,517 13,183 45,021
Capitalized interest 146 63 15 131
Total fixed
charges 58,127 77,580 13,198 45,152
Preferred dividends
adjusted for pretax
earnings coverage (3) 22,941 18,246 2,722 8,742
-------- -------- -------- --------
Combined fixed
charges and
preferred $ 81,068 $ 95,826 $ 15,920 $ 53,894
======== ======== ======== ========
RATIO OF EARNINGS TO
FIXED CHARGES (4) 0.70 1.24 (.50) .58
======== ======== ======== ========
RATIO OF EARNINGS TO
COMBINED FIXED CHARGES
AND PREFERRED DIVIDENDS(5) 0.50 1.01 (.42) .49
======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Historical(1)
Year Ended December 31
------------------------------------------------------
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
(In thousands except ratios)
<S> <C> <C> <C> <C> <C>
EARNINGS:
Income (loss) from
continuing
operations before
extraordinary items $ 22,698 $ 13,053 $ 81,452 $(16,037) $ 1,836
Add: Equity in net
losses (income) of
less-than 50% owned
affiliates 3,821 821 406 (385) 36
Dividends received
from less-than 50%
owned affiliates 253 340 788 766 123
Total federal income
taxes 15,738 921 (68,737) 6,636 (2,184)
Fixed charges (see
detail below) 110,117 89,361 72,222 81,736 99,288
Amortization of
previously
capitalized interest 16,589 9,871 7,441 7,707 6,547
-------- -------- -------- -------- --------
Total earnings(2) $169,216 $114,367 $93,572 $80,423 $105,646
======== ======== ======= ======== ========
FIXED CHARGES:
Interest expense $94,870 $83,324 $69,310 $77,720 $ 94,475
Rentals
representative of
the interest factor 15,247 6,037 2,912 4,016 4,813
-------- -------- -------- -------- --------
Fixed charges
deducted from
earnings 110,117 89,361 72,222 81,736 99,288
Capitalized interest 7,081 18,789 13,473 7,006 6,578
-------- -------- -------- -------- --------
Total fixed
charges 117,198 108,150 85,695 88,742 105,866
Preferred dividends
adjusted for pretax
earnings coverage(3) 19,201 12,515 11,619 12,663 12,952
-------- -------- -------- -------- --------
Combined fixed
charges and
preferred
dividends $136,399 $120,665 $97,314 $101,405 $118,818
======== ======== ======= ======== ========
RATIO OF EARNINGS TO
FIXED CHARGES(4) 1.44 1.06 1.09 0.91 1.00
======= ======= ======= ======== ======
RATIO OF EARNINGS TO
COMBINED FIXED
CHARGES AND
PREFERRED DIVIDENDS(5) 1.24 0.95 0.96 0.79 0.89
======= ======= ======= ======== ======
</TABLE>
<PAGE>
(1) On August 5, 1997, ENSERCH became a wholly owned subsidiary of
Texas Utilities Company (TUC) (Acquisition Date). Immediately
prior to ENSERCH's merger with TUC, Enserch Exploration, Inc.
(EEX), and Lone Star Energy Plan Operations, Inc. (LSEPO) were
merged to form a new company (New EEX) and ENSERCH distributed
to its common shareholders its ownership interest in these
businesses. TUC accounted for its acquisition of ENSERCH as a
purchase and purchase accounting adjustments, including
amortization of goodwill, have been reflected in the computation
of the ratios of earnings to fixed charges and ratios of
earnings to combined fixed charges and preferred dividends of
ENSERCH for the periods subsequent to August 5, 1997. Historical
ratios of earnings to fixed charges and ratio of earnings to
combined fixed charges and preferred dividends for the periods
ended before August 5, 1997, were prepared using ENSERCH's
historical basis of accounting. Amounts for the period from
January 1, 1997 to Acquisition Date have been restated to
reflect EEX and LSEPO as discontinued operations. Ratios for
years prior to 1997 were prepared using ENSERCH's historical
basis of accounting.
Adjusted - Ratios are based on unaudited "pro forma" financial
information included in a Form 8-K dated January 6, 1998,
incorporated by reference elsewhere in this Registration
Statement, which gives effect to: (1) the distribution by
ENSERCH to its common shareholders of its interest in EEX and
LSEPO; and (2) push down accounting of purchase accounting
adjustments from the TUC merger, all on a pro forma basis as if
the events had occurred at the beginning of each period
presented.
(2) "Earnings" represent the aggregate of (a) income from continuing
operations before extraordinary items, (b) income taxes, (c)
amortization of previously capitalized interest and (d) fixed
charges deducted from earnings, on a total enterprise basis.
"Fixed Charges" represent interest expense, capitalized interest
and the portion of rental expense representative of the interest
factor.
(3) The preferred stock dividend requirements are assumed to be
equal to the pretax earnings which would be required to cover
such dividend requirements. The amount of such pretax earnings
required to cover preferred stock dividends was computed using
tax rates for the applicable period. For the Adjusted periods,
the effective tax rates used exclude the impact of "pro forma"
goodwill amortization on pretax earnings because of the abnormal
impact on effective tax rates of nondeductible goodwill
amortization. For the Historical years ended December
31, 1994, 1993 and 1992 the Corporation's effective tax rate was
a negative percentage of the pretax income or loss. Therefore,
for these years only, the preferred stock dividends have not
been adjusted to a pretax equivalent since such an adjustment
would have been antidilutive to the ratio of earnings to fixed
charges and preferred dividends.
(4) For the Adjusted nine months ended September 30, 1997, fixed
charges exceeded earnings by $17.3 million. For the Historical
periods from Acquisition Date to September 30, 1997, from
January 1, 1997 to Acquisition Date and for the years ended
December 31, 1993 and 1992, fixed charges exceeded earnings by
$19.8 million, $19.0 million, $8.3 million and $.2 million,
respectively.
(5) For the Adjusted nine months ended September 30, 1997 combined
fixed charges and preferred dividends exceeded earnings by $40.2
million. For the Historical period from Acquisition Date to
September 30, 1997, from January 1, 1997 to Acquisition Date and
for the years ended December 31, 1995, 1994, 1993 and 1992,
combined fixed charges and preferred dividends exceeded earnings
by $22.5 million, $27.7 million, $6.3 million, $3.7 million,
$21.0 million and $13.2 million, respectively.
EXHIBIT 15
ENSERCH Corporation:
We have made a review, in accordance with standards established
by the American Institute of Certified Public Accountants, of the
unaudited interim condensed consolidated financial information of
ENSERCH Corporation and subsidiary companies included in your
Quarterly Reports on Form 10-Q for the quarters ended March 31,
1997; June 30, 1997 and September 30, 1997, as indicated in our
reports dated May 7, 1997; August 13, 1997 and November 12, 1997;
because we did not perform an audit, we expressed no opinion on
that information.
We are aware that our reports referred to above, which were
included in your Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1997; June 30, 1997 and September 30, 1997, are
being incorporated by reference in this Post Effective Amendment
No. 1 to Registration Statement No. 33-52525.
We also are aware that the aforementioned reports, pursuant to
Rule 436(c) under the Securities Act of 1933, are not considered
a part of the Registration Statement prepared or certified by an
accountant or a report prepared or certified by an accountant
within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touche LLP
Dallas, Texas
January 15, 1998
EXHIBIT 23(a)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Post-
Effective Amendment No. 1 to Registration Statement No. 33-52525
of ENSERCH Corporation of our report dated February 10, 1997,
appearing in the ENSERCH Corporation Annual Report on Form 10-K
for the year ended December 31, 1996, and to the reference to us
under the heading "Experts and Legality" in such Registration
Statement.
/s/ Deloitte & Touche LLP
Dallas, Texas
January 15, 1998
Exhibit 25(a)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST
INDENTURE ACT OF 1939 OF A CORPORATION
DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A
TRUSTEE PURSUANT TO SECTION 305(b)(2) ____________
-----------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(Jurisdiction of incorporation (I.R.S. Employer
if not a U.S. national bank) Identification No.)
48 Wall Street, New York, New York 10286
(Address of principal executive offices) (Zip code)
-----------------
ENSERCH CORPORATION
(Exact name of obligor as specified in its charter)
Texas 75-2527254
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201
(Address of principal executive offices) (Zip code)
-----------------
DEBT SECURITIES*
(Title of the indenture securities)
- --------
* Specific title(s) to be determined in connection with sale(s)
of Debt Securities.
<PAGE>
ITEM 1. GENERAL INFORMATION.**
Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority
to which it is subject.
Superintendent of Banks of the 2 Rector Street, New York, N.Y. 10006
State of New York and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance
Corporation 550 17th Street, N.W., Washington, D.C. 20429
New York Clearing House
Association New York, N.Y.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None. (See Note on page 2.)
ITEM 16. LIST OF EXHIBITS.
Exhibits identified in parentheses below, on file with the
Commission, are incorporated herein by reference as an exhibit hereto,
pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the
"Act") and Rule 24 of the Commission's Rules of Practice.
1. - A copy of the Organization Certificate of The Bank of New
York (formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration
Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to
Form T-1 filed with Registration Statement No. 33-29637.)
4. - A copy of the existing By-laws of the Trustee. (Exhibit 4
to Form T-1 filed with Registration Statement No. 33-31019.)
6. - The consent of the Trustee required by Section 321(b) of
the Act. (Exhibit 6 to Form T-1 filed with Registration
Statement No. 33-44051.)
7. - A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
- --------
** Pursuant to General Instruction B, the Trustee has responded
only to Items 1, 2 and 16 of this form since to the best of the
knowledge of the Trustee the obligor is not in default under any
indenture under which the Trustee is a trustee.
<PAGE>
NOTE
Inasmuch as this Form T-1 is being filed prior to the
ascertainment by the Trustee of all facts on which to base a
responsive answer to Item 2, the answer to said Item is based on
incomplete information.
Item 2 may, however, be considered as correct unless amended by
an amendment to this Form T-1.
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of
New York, a corporation organized and existing under the laws of the
State of New York, has duly caused this statement of eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized,
all in The City of New York, and State of New York, on the 15th day of
January, 1998.
THE BANK OF NEW YORK
By: WALTER N. GITLIN
----------------------
Walter N. Gitlin
Vice President
- 2 -
<PAGE>
EXHIBIT 7
(Page 1 of 3)
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal
Reserve System, at the close of business September 30, 1997, published
in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
- ------ ------------
Cash and balances due from
depository institutions:
Noninterest-bearing balances
and currency and coin......................................... $ 5,004,638
Interest-bearing balances..................................... 1,271,514
Securities:
Held-to-maturity securities.................................... 1,105,782
Available-for-sale securities................................... 3,164,271
Federal funds sold and Securities
purchased under agreements to resell......................... 5,723,829
Loans and lease financing
receivables:
Loans and leases, net of unearned
income........................................... 34,916,196
LESS: Allowance for loan and
lease losses...................................... 581,177
LESS: Allocated transfer risk
reserve........................................... 429
Loans and leases, net of unearned
income, allowance, and reserve............................... 34,334,590
Assets held in trading accounts................................... 2,035,284
Premises and fixed assets (including
capitalized leases)............................................. 671,664
Other real estate owned........................................... 13,306
Investments in unconsolidated subsid-
iaries and associated companies................................. 210,685
Customers' liability to this bank on
acceptances outstanding....................................... 1,463,446
Intangible assets................................................. 753,190
Other assets....................................................... 1,784,796
-----------
Total assets...................................................... $57,536,995
===========
<PAGE>
EXHIBIT 7
(Page 2 of 3)
LIABILITIES
- -----------
Deposits:
In domestic offices............................................ $27,270,824
Noninterest-bearing................................ 12,160,977
Interest-bearing................................... 15,109,847
In foreign offices, Edge and
Agreement subsidiaries, and IBFs............................... 14,687,806
Noninterest-bearing................................ 657,479
Interest-bearing................................... 14,030,327
Federal funds purchased and Securities
sold under agreements to repurchase ............................ 1,946,099
Demand notes issued to the U.S.
Treasury....................................................... 283,793
Trading liabilities.............................................. 1,553,539
Other borrowed money:
With remaining maturity of one year or less.................... 2,245,014
With remaining maturity of more than
one year through three years ................................. 0
With remaining maturity of more than
three years.................................................. 45,664
Bank's liability on acceptances
executed and outstanding....................................... 1,473,588
Subordinated notes and debentures................................ 1,018,940
Other liabilities................................................ 2,193,031
----------
Total liabilities................................................ 52,718,298
----------
EQUITY CAPITAL
- --------------
Common stock..................................................... 1,135,284
Surplus.......................................................... 731,319
Undivided profits and capital
reserves....................................................... 2,943,008
Net unrealized holding gains (losses)
on available-for-sale securities............................... 25,428
Cumulative foreign currency
translation adjustments........................................ (16,342)
-----------
Total equity capital............................................. 4,818,697
-----------
Total liabilities and equity capital............................. $57,536,995
===========
<PAGE>
EXHIBIT 7
(Page 3 of 3)
I, Robert E. Keilman, Senior Vice President and Comptroller of
the above-named bank do hereby declare that this Report of Condition
has been prepared in conformance with the instructions issued by the
Board of Governors of the Federal Reserve System and is true to the
best of my knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this
Report of Condition and declare that it has been examined by us and to
the best of our knowledge and belief has been prepared in conformance
with the instructions issued by the Board of Governors of the Federal
Reserve System and is true and correct.
J. Carter Bacot )
Thomas A. Renyi ) Directors
Alan R. Griffith )
