<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
____________
Date of Report: December 5, 1994
Date of Earliest Event Reported: November 29, 1994
PANHANDLE EASTERN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation)
1-8157
(Commission File
Number)
74-2150460
(I.R.S. Employer
Identification Number)
5400 Westheimer Court
P.O. Box 1642
Houston, Texas 77251-1642
(Address, including zip code, of principal executive office)
____________
Registrant's telephone number, including area code:
(713) 627-5400
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Item 5. Other Events.
On November 29, 1994, Panhandle Eastern Corporation entered into an
underwriting agreement for the public offering of $100 million principal amount
of its 8 5/8% Notes Due December 1, 1999. Closing of the transaction is
expected to take place on December 6, 1994.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
1.1 Underwriting Agreement and Terms Agreement between Panhandle
Eastern Corporation and Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Dillon, Read & Co. Inc., as Representatives of the
Several Underwriters, dated November 29, 1994.
4.1 Resolutions of a Special Committee of the Board of Directors
of Panhandle Eastern Corporation, adopted on November 29, 1994,
establishing the terms of the Notes and incorporating the form of the
Notes.
5.1 Opinion of Sullivan & Cromwell regarding legality of the
Notes, dated November 30, 1994.
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PANHANDLE EASTERN CORPORATION
/s/ JAMES B. HIPPLE
By:___________________________________
James B. Hipple
Senior Vice President and Chief
Financial Officer
Date: December 5, 1994
MMH/jab
3
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Index to Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description Page
- ------ ----------- ----
<S> <C> <C>
1.1 Underwriting Agreement and Terms Agreement between Panhandle Eastern Corporation and Merrill
Lynch, Pierce, Fenner & Smith Incorporated and Dillon, Read & Co. Inc., as Representatives of
the Several Underwriters, dated November 29, 1994.
4.1 Resolutions of a Special Committee of the Board of Directors of Panhandle Eastern Corporation,
adopted on November 29, 1994, establishing the terms of the Notes and incorporating the form of
the Notes.
5.1 Opinion of Sullivan & Cromwell regarding legality of the Notes, dated November 30, 1994.
</TABLE>
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PANHANDLE EASTERN CORPORATION
DEBT SECURITIES
UNDERWRITING AGREEMENT
1. Introductory. Panhandle Eastern Corporation, a Delaware corporation
("Company"), proposes to issue and sell from time to time certain of its debt
securities registered under the Registration Statement referred to in Section
2(a) ("Registered Securities"). The Registered Securities will be issued under
an Indenture, dated as of November 1, 1994 ("Indenture"), between the Company
and The First National Bank of Boston, as Trustee, in one or more series,
which series may vary as to interest rates, maturities, redemption provisions,
selling prices and other terms, with all such terms for any particular series
of the Registered Securities being determined at the time of sale. Particular
series of the Registered Securities will be sold pursuant to a Terms Agreement
referred to in Section 3 for resale in accordance with the terms of offering
determined at the time of sale.
The Registered Securities involved in any such offering are hereinafter
referred to as the "Securities". The firm or firms which agree to purchase the
Securities are hereinafter referred to as the "Underwriters" of such
Securities, and the representative or representatives of the Underwriters, if
any, specified in a Terms Agreement referred to in Section 3 are hereinafter
referred to as the "Representatives"; provided, however, that if the Terms
Agreement does not specify any representative of the Underwriters, the term
"Representatives", as used in this Agreement, shall mean the Underwriters.
2. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each Underwriter that:
(a) A registration statement (No. 33-56337), including a prospectus,
relating to the Registered Securities has been filed with the Securities and
Exchange Commission ("Commission") and has become effective. Such registration
statement, as amended at the time of any Terms Agreement referred to in Section
3, is hereinafter referred to as the "Registration Statement", and the
prospectus included in such Registration Statement, as supplemented as
contemplated by Section 3 to reflect the terms of the Securities and the terms
of offering thereof, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) ("Rule 424(b)") under the Securities Act of 1933
(the "Act"), including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus".
(b) On the effective date of the registration statement relating to the
Registered Securities, such registration statement conformed in all material
respects to the requirements of the Act, the Trust Indenture Act of 1939, as
amended ("Trust Indenture Act"), and the rules and regulations of the
Commission ("Rules and Regulations") and did not include any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
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and on the date of each Terms Agreement referred to in Section 3, the
Registration Statement and Prospectus will conform in all material respects
to the requirements of the Act, the Trust Indenture Act and the Rules and
Regulations, and neither of such documents will include any untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, except that
the foregoing does not apply to statements in or omissions from any of such
documents based upon written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein.
(c) Other than Panhandle Eastern Pipe Line Company, Texas Eastern
Transmission Corporation, Trunkline Gas Company, Algonquin Gas Transmission
Company, Trunkline LNG Company, Pan Gas Storage Company, Centana Intrastate
Pipeline Company, and Centana Energy Corporation, each a Delaware
corporation, the Company does not have any Principal Subsidiary (as defined in
the Indenture).
3. Purchase and Offering of Securities. The obligation of the
Underwriters to purchase the Securities will be evidenced by a Terms Agreement,
which may consist of an exchange of telegraphic or other written
communications ("Terms Agreement") at the time the Company determines to sell
the Securities. The Terms Agreement will incorporate by reference the
provisions of this Agreement, except as otherwise provided therein, and will
specify the firm or firms which will be Underwriters, the names of any
Representatives, the principal amount to be purchased by each Underwriter, the
purchase price to be paid by the Underwriters, any compensation or
commissions to be paid to the Underwriters and the terms of the Securities not
already specified in the Indenture, including, but not limited to, interest
rate, maturity, any redemption provisions, and any sinking fund requirements
and whether any of the Securities may be sold to institutional investors
pursuant to Delayed Delivery Contracts (as defined below). The Terms Agreement
will also specify the time and date of delivery and payment (such time and
date, or such other time not later than seven full business days thereafter as
the Representatives and the Company agree as the time for payment and delivery,
being herein and in the Terms Agreement referred to as the "Closing Date"), the
place of delivery and payment and any details of the terms of offering that
should be reflected in the prospectus supplement relating to the offering of
the Securities. The obligations of the Underwriters to purchase the
Securities will be several and not joint. It is understood that the
Underwriters propose to offer the Securities for sale as set forth in the
Prospectus. The Securities delivered to the Underwriters on the Closing Date
will be in definitive, fully registered form, in such denominations and
registered in such names as the Underwriters may request upon not less than
forty-eight hours notice to the Company.
If the Terms Agreement provides for sales of Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to solicit
offers to purchase Securities pursuant to delayed delivery contracts
substantially in the form of Annex I attached hereto ("Delayed Delivery
Contracts") with such changes therein as the Company may authorize or approve.
Delayed Delivery Contracts are to be with institutional investors, including
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commercial and savings banks, insurance companies, pension funds, investment
companies and educational and charitable institutions. On the Closing Date,
the Company will pay, as compensation, to the Representatives for the accounts
of the Underwriters, the fee set forth in such Terms Agreement in respect of
the principal amount of Securities to be sold pursuant to Delayed Delivery
Contracts ("Contract Securities"). The Underwriters will not have any
responsibility in respect of the validity or the performance of Delayed
Delivery Contracts. If the Company executes and delivers Delayed Delivery
Contracts, the Contract Securities will be deducted from the Securities to be
purchased by the several Underwriters and the aggregate principal amount of
Securities to be purchased by each Underwriter will be reduced pro rata in
proportion to the principal amount of Securities set forth opposite each
Underwriter's name in such Terms Agreement, except to the extent that the
Representatives determine that such reduction shall be otherwise than pro rata
and so advise the Company. The Company will advise the Representatives no
later than the business day prior to the Closing Date of the principal amount
of Contract Securities.
4. Certain Agreements of the Company. The Company agrees with the
several Underwriters that it will furnish to Vinson & Elkins L.L.P., counsel for
the Underwriters, two copies of the registration statement relating to the
Registered Securities, including all exhibits, in the form it became effective
and of all amendments thereto and that, in connection with each offering of
Securities:
(a) The Company will file the Prospectus with the Commission
pursuant to and in accordance with Rule 424(b)(2) (or, if applicable and if
consented to by the Representatives, subparagraph (5)), not later than the
second business day following the execution and delivery of the Terms
Agreement.
(b) The Company will advise the Representatives promptly of any
proposal to amend or supplement the Registration Statement or the Prospectus
and will afford the Representatives a reasonable opportunity to comment on any
such proposed amendment or supplement; and the Company will also advise the
Representatives promptly of the filing of any such amendment or supplement and
of the institution by the Commission of any stop order proceedings in respect
of the Registration Statement or of any part thereof and will use its best
efforts to prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued. The terms "supplements" and "amendments" as
used in this Agreement shall include, without limitation, all documents filed
by the Company with the Commission subsequent to the date of the Prospectus
included in the Registration Statement which are deemed to be incorporated by
reference in the Prospectus.
(c) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend the
Prospectus to comply with the Act, the Company promptly will advise the
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Representatives of such event and will prepare and file with the
Commission an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance. Neither the
Representatives' consent to, nor the Underwriters' delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions set
forth in Section 5.
(d) As soon as practicable, but not later than 16 months, after the
date of each Terms Agreement, the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12 months
beginning after the later of (i) the effective date of the registration
statement relating to the Registered Securities, (ii) the effective date of the
most recent post-effective amendment to the Registration Statement to become
effective prior to the date of such Terms Agreement and (iii) the date of the
Company's most recent Annual Report on Form 10-K filed with the Commission
prior to the date of such Terms Agreement, which will satisfy the provisions of
Section 11(a) of the Act.
(e) The Company will furnish, without charge, to the
Representatives copies of the Registration Statement, including all exhibits,
any related preliminary prospectus, any related preliminary prospectus
supplement, the Prospectus and all amendments and supplements to such
documents, in each case as soon as available and in such quantities as are
reasonably requested.
(f) The Company will arrange for the qualification of the
Securities for sale and the determination of their eligibility for investment
under the laws of such jurisdictions in the United States as the
Representatives designate and will continue such qualifications in effect so
long as required for the distribution; provided that the Company shall not be
required to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction.
(g) For so long as any Securities are outstanding, the Company
will furnish to the Representatives and, upon request, to each of the other
Underwriters, (i) as soon as available, a copy of each report or definitive
proxy statement of the Company filed with the Commission under the Exchange
Act or mailed to securityholders (other than reports on Form 11-K), (ii) copies
of any registration statements which the Company or any of its subsidiaries
shall file with the Commission under the Act (other than registration
statements on Form S-8) and (iii) from time to time, such other information
concerning the Company as the Representatives may reasonably request
(h) The Company will pay all expenses incident to the performance
of its obligations under this Agreement and will reimburse the Underwriters for
any expenses (including reasonable fees and disbursements of counsel) incurred
by them in connection with the qualification of the Registered Securities for
sale under the laws of such jurisdictions in the United States as the
Representatives may designate and the printing of memoranda relating thereto,
for any fees charged by investment rating agencies for the rating of the
Securities
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and for expenses incurred in distributing the Prospectus, any preliminary
prospectuses and any preliminary prospectus supplements to the Underwriters.
(i) Between the date of the applicable Terms Agreement and 10 days
after the Closing Date, the Company will not, nor will the Company permit any
subsidiary to, without the prior consent of the Representatives, offer or sell,
or enter into any agreement to sell, any debt securities of the Company or of
any subsidiary with a maturity of more than one year, including, without
limitation, any additional Securities.
(j) The Company will advise the Representatives at the time of entering
into the Terms Agreement, and during the period from that time through the time
of purchase, to the best of the Company's knowledge and belief, of any material
decreases in operating revenues or net operating income of the Company and its
subsidiaries on a consolidated basis for the period from the date of the
latest available interim unaudited consolidated financial statements of the
Company until and including the date of the Terms Agreement.
5. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Securities will be subject
to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of Company officers made
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) On or prior to the Closing Date, the Representatives shall
have received a letter, addressed to the Underwriters and dated the date of
delivery thereof, of KPMG Peat Marwick LLP, in the form previously approved by
the Representatives.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 4(a) of this Agreement.
The Registration Statement shall be effective and no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceedings for that purpose shall have been instituted or, to
the knowledge of the Company or any Underwriter, shall be contemplated by the
Commission.
(c) Subsequent to the execution of the Terms Agreement, there
shall not have occurred (i) any change or any development involving a
prospective change, in or affecting particularly the business or properties of
the Company or its subsidiaries which, in the judgment of a majority in
interest of the Underwriters, including any Representatives, materially impairs
the investment quality of the Securities or the Registered Securities; (ii) any
downgrading in the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company other than an announcement with positive implications
of a possible upgrading, and no implication of a possible downgrading,
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of such rating); (iii) any suspension or limitation of trading in securities
generally on the New York Stock Exchange, or any setting of minimum prices for
trading on such exchange, or any suspension of trading of any securities of the
Company on any exchange or in the over-the-counter market; (iv) any banking
moratorium declared by Federal or New York authorities, or (v) any outbreak or
escalation of major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority in
interest of the Underwriters, including any Representatives, the effett of any
such outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the sale of and
payment for the Securities.
(d) The Representatives shall have received an opinion or
opinions, dated the Closing Date, of Sullivan & Cromwell, special counsel for
the Company, to the effect that:
(i) Each of the Company and the Principal
Subsidiaries has been duly incorporated and is an existing
corporation in good standing under the laws of the State of
Delaware and has the corporate power and authority to own,
lease and operate its properties and conduct its business as
described in the Registration Statement and Prospectus.
(ii) This Agreement, the Terms Agreement and any
Delayed Delivery Contracts with respect to the Securities have
been duly authorized, executed and delivered by the Company.
(iii) The Indenture has been duly authorized,
executed and delivered by the Company and duly qualified under
the Trust Indenture Act; the Securities have been duly
authorized; the Securities other than any Contract Securities
have been duly executed, authenticated, issued and delivered;
and the Indenture and the Securities other than any Contract
Securities constitute, and any Contract Securities, when
executed, authenticated, issued and delivered in the manner
provided in the Indenture and sold pursuant to Delayed
Delivery Contracts, will constitute valid and legally binding
obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors'
rights and to general equity principles.
(iv) The Securities other than any Contract
Securities conform, and any Contract Securities, when so
issued and delivered and sold, will conform, in all material
respects, to the description thereof contained in the
Prospectus.
(v) The Registration Statement is effective under
the Act and, to the best of their knowledge and information,
no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued under the Act
and no proceedings therefor have been initiated or threatened
by the Commission.
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(vi) All regulatory consents, authorizations approvals and
filings required to be obtained or made by the Company or any direct
or indirect subsidiary of the Company under the Federal laws of the
United States, the laws of the State of New York and the General
Corporation Law of the State of Delaware for the issuance, sale and
delivery of the Securities by the Company to the Underwriters have
been obtained or made and, to the best of the knowledge and
information of such counsel, remain in full force and effect.
(vii) The issuance of the Securities and the sale of the
Securities by the Company pursuant to this Agreement, the Terms
Agreement and any Delayed Delivery Contracts do not, and the
execution, delivery and performance by the Company of its obligations
under the Indenture, this Agreement, the Terms Agreement, any Delayed
Delivery Contracts and the Securities will not, (A) violate the
Company's certificate of incorporation or by-laws, (B) result in a
default under or breach of, or result in the creation or imposition of
any lien, charge or encumbrance (except as permitted by the Indenture)
upon the property or assets of the Company or any of its subsidiaries
by virtue of, any indenture, mortgage or other agreement or instrument
relating to the borrowing of money known to such counsel to which the
Company or any direct or indirect subsidiary of the Company is a party
or by which any of them or any of their property is bound, or (C)
violate any federal law of the United States or law of the State of
New York applicable to the Company or any direct or indirect
subsidiary of the Company or the Delaware General Corporation Law;
provided, however, that, for the purposes of this subparagraph (vii),
such counsel need express no opinion with respect to Federal or state
securities laws, other anti-fraud laws and fraudulent transfer laws;
and provided, further, that insofar as performance by the Company of
its obligations under the Indenture, this Agreement, the Terms
Agreement, any Delayed Delivery Contracts and the Securities is
concerned, such counsel need express no opinion as to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights.
(viii) Each part of the Registration Statement, when such
part became effective, and the Prospectus, as of the date of the
Prospectus, and any amendment or supplement thereto, as of its date,
appeared on its face to be appropriately responsive, in all material
respects relevant to the offering of the Securities, to the
requirements of the Act, the Trust Indenture Act and the applicable
rules and regulations of the Commission thereunder. Nothing which
came to the attention of such counsel in the course of their review
of the Registration Statement or their prior representation of the
Company and its subsidiaries has caused them to believe that, insofar
as relevant to the offering of the Securities, any part of the
Registration Statement, when such part become effective, or the
Prospectus, as of the date of the Prospectus, contained any untrue
statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, or the Prospectus, as amended or supplemented
on the
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Closing Date, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. Such opinion shall also state that such
counsel do not know of any documents that are required to be filed as
exhibits to the Registration Statement and are not so filed or of any
documents that are required to be summarized in the Prospectus and are
not so summarized. Such opinion may state that such counsel do not
assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement and
Prospectus except as otherwise expressly provided in such opinion and
for those made under the captions relating to the description of the
Securities insofar as they relate to provisions of documents therein
described, and do not express any opinion or belief as to the
financial statements or other financial data contained in the
Registration Statement and the Prospectus or as to the statement of
the eligibility and qualification of the Trustee.
In rendering the foregoing opinion or opinions, Sullivan & Cromwell may
state that such opinion or opinions are limited to the Federal laws of the
United States, the laws of the State of New York and the General Corporation
Law of the State of Delaware, and that they are expressing no opinion as to the
effect of the laws of any other jurisdiction. In addition, such counsel may
state that they have relied as to certain matters on information obtained from
public officials, officers of the Company and other sources believed by them to
be responsible, and that they have assumed that the Indenture has been duly
authorized, executed and delivered by the Trustee, that the Securities conform
or will conform to the specimen thereof examined by them, that the Trustee's
certificates of authentication of the Securities have been or will be manually
signed by one of the Trustee's authorized officers, and that the signatures on
all documents examined by them are genuine, assumptions which such counsel have
not independently verified.
(e) The Representatives shall have received an opinion or
opinions, dated the Closing Date, of Carl B. King, General Counsel of the
Company, to the effect that:
(i) Each of the Company and the Principal Subsidiaries is
duly qualified to do business in each jurisdiction in which the
ownership or leasing of its property or the conduct of its business
requires such qualification, except where the failure to so qualify,
considering all such cases in the aggregate, does not have a material
adverse effect on the business, properties, financial position or
results of operations of the Company and its subsidiaries taken as a
whole.
(ii) The issuance of the Securities and the sale of the
Securities by the Company pursuant to this Agreement, the Terms
Agreement and any Delayed Delivery Contracts do not, and the
performance by the Company of its obligations under the Indenture,
this Agreement, the Terms Agreement, any Delayed Delivery Contracts
and the Securities will not, conflict with or constitute or result in
a breach of, or default under, (A) any judgment, order or decree known
to such counsel of
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any domestic government, governmental instrumentality or court having
jurisdiction over the Company or its subsidiaries, or any of their
respective property, or (B) any agreement or instrument (other than
agreements or instruments referred to in paragraph (vii) of the opinion
of Sullivan & Cromwell) known to such counsel to which the Company or
any of its subsidiaries is a party or by which any of them or their
respective property is bound, in either case which is material to the
Company and its subsidiaries taken as a whole.
(iii) Such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the Company
or any of its subsidiaries that would be required to be disclosed in
the Prospectus and is not so disclosed.
Such counsel shall also state that nothing has come to his attention
that has caused him to believe that any part of the Registration Statement,
when such part became effective, or the Prospectus, as of the date of the
Prospectus, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or the Prospectus, as amended or supplemented
on the Closing Date, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Such counsel may also state that he does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus and does not express
any opinion or belief as to the financial statements or other financial data
contained in the Registration Statement and the Prospectus.
In rendering the foregoing opinion or opinions, such counsel may rely,
to the extent recited therein, upon opinions of local counsel. Such counsel
may also state that he has relied as to certain factual matters on information
obtained from public officials, officers of the Company and other sources
believed by him to be responsible.
(f) The Representatives shall have received from Vinson & Elkins
L.L.P., counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to the incorporation of the Company, the validity of
the Securities, the Registration Statement, the Prospectus and other related
matters as the Representatives may require, and the Company shall have
furnished to such counsel such documents as they may request for the purpose of
enabling them to pass upon such matters.
(g) The Representatives shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to the
best of their knowledge after reasonable investigation, shall state that the
representations and warranties of the Company in this Agreement are true and
correct, that the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to
the Closing Date, that no stop order suspending the effectiveness of the
Registration Statement
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or of any part thereof has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission and that, subsequent to
the date of the most recent financial statements in the Prospectus, there has
been no material adverse change in the financial position or results of
operation of the Company and its subsidiaries except as set forth in or
contemplated by the Prospectus or as described in such certificate.
The Company will furnish the Representatives with such conformed copies of
such opinions, certificates, letters and documents as the Representatives
reasonably request.
6. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Indenture against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter may become subject, under the Act
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus or preliminary prospectus supplement, or arise
out of or are based upon 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, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives specifically for use
therein; and provided further that the indemnity agreement contained in this
Section 6 with respect to any preliminary prospectus shall not inure to the
benefit of any Underwriter (or to the benefit of any person controlling such
Underwriter) from whom a person asserting any such damage, loss, expense,
liability or claim purchased the Securities if (i) the Prospectus corrected any
untrue statement or alleged untrue statement or omission or alleged omission in
such preliminary prospectus and (ii) such Underwriter failed to send or give a
copy of the Prospectus (excluding documents incorporated by reference) to such
person at or prior to the written confirmation of the sale of such Securities
to such person provided that such corrected Prospectus was made available by the
Company prior thereto.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make
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the statements therein not misleading, in each case to the extent, but only to
the extent that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred.
(c) Promptly after receipt by in indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnified party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Company or the
Underwriters and the parties' relative intent knowledge, access to information
and opportunity to correct or
-11-
<PAGE> 12
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to
in the first sentence of this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or claim which is the
subject of this subsection (d). The Company and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this subsection (d)
were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does
not take into account the equitable considerations referred to in this
subsection (d). Notwithstanding the provisions of this subsection (d) no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason
of such untrue or alleged statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section shall be in addition to any liability
which the respective Underwriters may otherwise have and shall extend, upon
the same terms and conditions, to each director of the Company, to each
officer of the Company who has signed the Registration Statement and to
each person, if any, who controls the Company within the meaning of the Act.
7. Default of Underwiters. If any Underwriter or Underwriters
default in their obligations to purchase Securities under the Terms Agreement
and the aggregate principal amount of the Securities that such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10%
of the total principal amount of the Securities, the Representatives may make
arrangements satisfactory to the Company for the purchase of such Securities by
other persons, including any of the Underwriters, but if no such arrangements
are made by the Closing Date, the non-defaulting Underwriters shall be
obligated severally, in proportion to their respective commitments under this
Agreement and the Terms Agreement, to Purchase the Securities that such
defaulting Underwriters agreed but failed to purchase. If any Underwriter or
Underwriters so default and the aggregate principal amount of the Securities
with respect to which such default or defaults occur exceeds 10% of the total
principal amount of the Securities and arrangements satisfactory to the
Representatives and the Company for the purchase of such Securities by other
persons are not made within 36 hours after such default, such Terms Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Company, except as provided in Section 8. As used in this Agreement, the
term "Underwriter"
-12-
<PAGE> 13
includes any person substituted for an Underwriter under this Section. Nothing
herein will relieve a defaulting Underwriter from liability for its default.
The respective commitments of the several Underwriters for the purposes of
this Section shall be determined without regard to reduction in the respective
Underwriters' obligations to purchase the principal amounts of the Securities
set forth opposite their names in the Terms Agreement as a result of Delayed
Delivery Contracts entered into by the Company.
The foregoing obligations and agreements set forth in this Section
will not apply if the Terms Agreement specifies that such obligations and
agreements will not apply.
8. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results
thereof, made by or on behalf of any Underwriter, the Company or any of their
respective representatives, officers or directors or any controlling person,
and will survive delivery of and payment for the Securities. If the Terms
Agreement is terminated pursuant to Section 7 or if for any reason the
purchase of the Securities by the Underwriters under the Terms Agreement is
not consummated, the Company shall remain responsible for the expenses to be
paid or reimbursed by it pursuant to Section 4 and the respective obligations
of the Company and the Underwriters pursuant to Section 6 shall remain in
effect. If the purchase of the Securities by the Underwriters is not
consummated for any reason other than solely because of the termination
of this Agreement pursuant to Section 7 or the occurrence of any event
specified in clause (iii), (iv) or (v) of Section 5(c), the Company will
reimburse the Underwriters for all out-of-pocket expenses (including fees
and disbursements of counsel) reasonably incurred by them in connection with
the offering of the Securities.
9. Notices. All communications hereunder will be in writing and,
if sent to the Underwriters, will be mailed, delivered or faxed and confirmed
to them at their addresses furnished to the Company in writing for the purpose
of communications hereunder or, if sent to the Company, can be mailed,
delivered or faxed and confirmed at Panhandle Eastern Corporation, 5400
Westheimer Court, Houston, Texas 77251-1642 (telecopy number (713) 627-4603;
confirm (713) 627-4612), Attention: J. B. Hipple, Senior Vice President and
Chief Financial Officer.
10. Successors. This Agreement will inure to the benefit of and
be binding upon the Company and such Underwriters as are identified in Terms
Agreements and their respective successors and the officers and directors and
controlling persons referred to in Section 6, and no other person will have any
right or obligation hereunder.
11. Applicable Law. This Agreement and the Terms Agreement shall
be governed by, and construed in accordance with, the laws of the State of
New York.
-13-
<PAGE> 14
12. Consent to Representation. The Company and the Underwriters
acknowledge that Sullivan & Cromwell, which will be acting as special counsel to
the Company in connection with the offer and sale of the Securities, also acts
as counsel from time to time to one or more of the Underwriters in connection
with unrelated matters. The Company and the Underwriters consent to Sullivan &
Cromwell so acting as special counsel to the Company. The Company and the
Underwriters also acknowledge that Vinson & Elkins L.L.P., which is acting as
counsel to the Underwriters in connection with the offer and sale of the
Securities, also acts as counsel from time to time to the Company and certain
of its affiliates in connection with unrelated matters. The Company and
Underwriters consent to Vinson & Elkins L.L.P. so acting as counsel to the
Underwriters.
-14-
<PAGE> 15
ANNEX I
(Three copies of this Delayed Delivery Contract should be
signed and returned to the address shown below so as
to arrive not later than 9:00 A.M., New York time,
on _____________________ ______, 19____)
DELAYED DELIVERY CONTRACT
Panhandle Eastern Corporation
c/o Merrill Lynch & Co.
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281-1209
Attention:________________
Gentlemen:
The undersigned hereby agrees to purchase from Panhandle Eastern
Corporation, a Delaware corporation ("Company"), and the Company agrees to sell
to the undersigned, [if one delayed closing--as of the date hereof, for
delivery on _________, 199__ ("Delivery Date")], $ __________ principal amount
of the Company's ___________ ("Securities"), offered by the Company's Prospectus
dated November 15, 1994 and a Prospectus Supplement dated ________ ____, 199__,
relating thereto, receipt of copies of which is hereby acknowledged, at ___% of
the principal amount thereof plus accrued interest, if any, and on the further
terms and conditions set forth in this Delayed Delivery Contract ("Contract").
[If two or more delayed closings:
The undersigned will purchase from the Company as of the date hereof,
for delivery on the dates set forth below, Securities in the principal amounts
set forth below:
<TABLE>
<CAPTION>
Delivery Date Principal Amount
<S> <C>
_____________ ________________
_____________ ________________
</TABLE>
Each of such delivery dates is hereinafter referred to as a Delivery Date.]
-1-
<PAGE> 16
Payment for the Securities that the undersigned has agreed to purchase
for delivery on the Delivery Date shall be made to the Company or its order in
same-day funds at the office of _____________ _________ at _________ ____.M. on
the [such] Delivery Date upon delivery to the undersigned of the Securities to
be purchased by the undersigned [for delivery on such Delivery Date] in
definitive fully registered form and in such denomination and registered in
such names as the undersigned may designate by written or telegraphic
communication addressed to the Company not less than five full business days
prior to the [such] Delivery Date.
It is expressly agreed that the provisions for delayed delivery and
payment are for the sole convenience of the undersigned; that the purchase
hereunder of Securities is to be regarded in all respects as a purchase as of
the date of this Contract; that the obligation of the Company to make delivery
of and accept payment for, and the obligation of the undersigned to take
delivery of and make payment for, securities on the [each] Delivery Date shall
be subject only to the conditions that (1) investment in the Securities shall
not at the [such] Delivery Date be prohibited under the laws of any
jurisdiction in the United States to which the undersigned is subject and (2)
the Company shall have sold to the Underwriters the total principal amount of
the Securities less the principal amount thereof covered by this and other
similar Contracts. The undersigned represents that its investment in the
Securities is not, as of the date hereof, prohibited under the laws of any
jurisdiction to which the undersigned is subject and which governs such
investment.
Promptly after completion of the sale to the Underwriters the Company
will mail or deliver to the undersigned at its address set forth below notice
to such effect, accompanied by a copy of the opinions of counsel for the
Company relating to the validity of the Securities delivered to the
Underwriters in connection therewith.
This Contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
-2-
<PAGE> 17
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this Contract is acceptable to the Company,
it is requested that the Company sign the form of acceptance below and mail or
deliver one of the counterparts between the Company and the undersigned when
such counterpart is so mailed or delivered.
Yours very truly,
__________________________________________
(Name of Purchaser)
By________________________________________
__________________________________________
__________________________________________
(Title of Signatory)
__________________________________________
__________________________________________
(Address of Purchaser)
Accepted, as of the above date.
Panhandle Eastern Corporation
By__________________________________
[insert title]
-3-
<PAGE> 18
PANHANDLE EASTERN CORPORATION
("COMPANY")
DEBT SECURITIES
TERMS AGREEMENT
November 29, 1994
Panhandle Eastern Corporation
5400 Westheimer Court
P.0. Box 1642
Houston, Texas 77251-1642
Dear Sirs:
The undersigned offers to purchase, on and subject to the terms and
conditions of the Underwriting Agreement attached hereto ("Underwriting
Agreement"), the following securities ("Securities") on the following terms:
TITLE: 8-5/8% Notes due December 1, 1999
PRINCIPAL AMOUNT: $100,000,000
INTEREST: 8-5/8% per annum, from December 6, 1994, payable semiannually on
June 1 and December 1, commencing June 1, 1995, to holders of record on the
preceding May 15 or November 15, as the case may be.
MATURITY: December 1, 1999
OPTIONAL REDEMPTION: None
SINKING FUND: None
DELAYED DELIVERY CONTRACTS: None
PURCHASE PRICE: 99.259% of principal amount, plus accrued interest, if
any, from December 6, 1994.
EXPECTED REOFFERING PRICE: 99.859% of principal amount, subject to change
by the undersigned.
CLOSING: 9:00 A.M. on December 6, 1994 at the offices of the Company, 5400
Westheimer Court, Houston, Texas in same-day funds.
-1-
<PAGE> 19
NAMES AND ADDRESSES OF THE REPRESENTATIVES OF THE SEVERAL UNDERWRITERS:
Merrill Lynch Pierce, Fenner & Smith Incorporated
Dillon, Read & Co. Inc.
c/o Merrill Lynch & Co.
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281-1209
The respective principal amounts of the Securities to be purchased by each
of the Underwriters are set forth opposite their names below:
<TABLE>
<CAPTION>
PRINCIPAL
UNDERWRITER AMOUNT
----------- ----------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................................ $ 44,000,000
Dillon, Read & Co. Inc. ...................... $ 44,000,000
BA Securities, Inc. .......................... $ 3,000,000
Chemical Securities Inc. ..................... $ 3,000,000
NatWest Capital Markets Limited............... $ 3,000,000
UBS Securities, Inc. ......................... $ 3,000,000
--------------
Total........... $ 100,000,000
==============
</TABLE>
It is understood that we may, with your consent, amend this offer to add
one or more additional Underwriters and reduce the aggregate principal amount
of the Securities to be purchased by the Underwriters listed above by the
aggregate principal amount to be purchased by such additional Underwriters. The
provisions of the Underwriting Agreement are incorporated herein by reference.
The Securities will be made available for checking and packaging at the office
of Merrill Lynch & Co., Merrill Lynch World Headquarters, North Tower, World
Financial Center, New York, New York, at least 24 hours prior to the Closing
Date.
The undersigned are executing this Terms Agreement on behalf of themselves
and as Representatives of the other Underwriters named above.
-2-
<PAGE> 20
Please signify your acceptance of our offer by signing the enclosed
response to us in the space provided and return it to us.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
DILLON, READ & CO. INC.
BY: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ ROB L. JONES
Rob L. Jones
Director
-3-
<PAGE> 1
PANHANDLE EASTERN CORPORATION
MINUTES OF A MEETING OF THE PRICING COMMITTEE
November 29, 1994
The Pricing Committee (the "Committee") established on October 26, 1994,
by Resolutions of the Board of Directors of Panhandle Eastern Corporation (the
"Company") convened a meeting at the offices of the Company at 8:45 a.m. on
November 29, 1994. The following members of the Committee were present and
constituted a quorum of the Committee: Dennis R. Hendrix and J. B. Hipple.
Paul M. Anderson was unavailable. Mr. Hipple acted as Secretary of the
meeting.
The purpose of the meeting was for the Committee to take certain actions
regarding the issuance of $100 million of unsecured debt securities of the
Company which had been authorized on October 26, 1994, and which were
registered with the SEC on November 15, 1994, as part of a $200 million shelf
registration statement filed on November 4, 1994. Mr. Hipple first summarized
his discussions with representatives of the underwriters. Following a
discussion thereof, and upon a motion duly made and seconded, the following
Resolutions were unanimously approved and adopted:
RESOLVED, that pursuant to the authority delegated to this
Pricing Committee by the Board of Directors of Panhandle Eastern
Corporation (the "Company") by Resolutions adopted on October 26,
1994, unsecured debt securities of the Company referred to in such
Resolutions shall be issued and designated as the Company's 8 5/8%
Notes due December 1, 1999 (the "Notes"); and
FURTHER RESOLVED, that the Indenture, dated as of November 1,
1994 (the "Indenture"), between the Company and The First National
Bank of Boston, as Trustee, be, and it hereby is, authorized and
approved, and the execution and delivery thereof by the Vice
President, Finance & Accounting and Treasurer is ratified, confirmed
and approved; and
FURTHER RESOLVED, that in addition to the terms provided in the
Indenture, the terms of the Notes shall be as follows:
(1) The aggregate principal amount of the Notes shall be
$100 million;
(2) The Stated Maturity of the Principal of the Notes
shall be December 1, 1999;
<PAGE> 2
(3) The Notes shall bear interest at the rate of 8 5/8%
per annum from December 6, 1994, or from the most recent
Interest Payment Date to which interest has been paid or duly
provided for;
(4) The Interest Payment Dates with respect to the Notes
shall be December 1 and June 1 in each year, commencing June
1, 1995, and the Regular Record Dates for interest payable on
any such Interest Payment Date shall be May 15 or November 15
(whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date;
(5) Principal of and interest on the Notes shall be
payable, and the Notes will be exchangeable and transfers
thereof will be registrable, at the Corporate Trust Office of
the Trustee, and at any other office or agency maintained by
the Company for such purpose; provided, however, that, at the
option of the Company, payment of interest may be made by
check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register;
(6) The Notes shall not be subject to redemption prior to
maturity and shall not be subject to a sinking fund
requirement;
(7) The Notes shall be subject to defeasance under
Section 1302 of the Indenture and to covenant defeasance under
Section 1303 of the Indenture;
(8) The Notes will not be issued in the form of
Book-Entry Securities; and
FURTHER RESOLVED, that the Notes shall be issuable in
denominations of $1,000 and integral multiples thereof; and
FURTHER RESOLVED, that the form of the Notes set forth in
Exhibit A to these resolutions be, and hereby is, approved; and
-2-
<PAGE> 3
FURTHER RESOLVED, that Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Dillon, Read & Co., Inc., are selected as the
representatives of the several underwriters (the "Underwriters") to
which the Notes will be sold; that the purchase price to be paid to
the Company by the Underwriters shall be 99.259% of the principal
amount of the Notes; and that the initial public offering price shall
be 99.859% of the principal amount of the Notes; and
FURTHER RESOLVED, that the proposed Terms Agreement (the "Terms
Agreement") and the proposed Underwriting Agreement attached thereto
and made a part thereof (the "Underwriting Agreement") between the
Company and the Underwriters be, and such agreements hereby are,
approved in the form presented to this Pricing Committee.
There being no further business to come before the meeting, on motion duly
made, seconded, and unanimously carried, the meeting was adjourned.
/s/ J.B. HIPPLE
----------------------------
J. B. Hipple
Secretary of the Meeting
-3-
<PAGE> 4
EXHIBIT A
(Form of Note)
(Form of Face)
PANHANDLE EASTERN CORPORATION
8 5/8% Notes due December 1, 1999
No. $
Panhandle Eastern Corporation, a corporation duly organized and
existing under the laws of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to _______________________
or registered assigns, the principal sum of _______________________ Dollars on
December 1, 1999 and to pay interest thereon from December 6, 1994 or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually in arrears on June 1 and December 1 in each year,
commencing June 1, 1995, at the rate of 8 5/8% per annum, until the principal
hereof is paid or made available for payment. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the May 15 or
November 15 (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Except as otherwise provided in the Indenture, any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Holder on such Regular Record Date and may either be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in the Indenture.
Payment of the principal of and interest on this Security will be made at the
Corporate Trust Office of the Trustee, or such other office or agency of the
Company as may be designated by it for such purpose in such coin or currency of
the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made by check mailed to the
<PAGE> 5
address of the Person entitled thereto as such address shall appear in the
Security Register.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof, directly or through an
Authenticating Agent, by manual signature of an authorized signatory, this
Security shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
signed in its name by its Chairman of the Board and Chief Executive Officer,
President or a Vice President, manually or by a facsimile of his signature, and
its corporate seal (or a facsimile thereof) to be hereunto affixed and the same
to be attested by its Secretary or an Assistant Secretary, all either manually
or in facsimile.
Dated: ____________________
PANHANDLE EASTERN CORPORATION
By________________________________
(Seal)
Attest:
___________________________
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF BOSTON,
as Trustee
By_______________________________
Authorized Officer
-2-
<PAGE> 6
(Form of Reverse)
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of November 1, 1994 (herein called the
"Indenture"), between the Company and The First National Bank of Boston, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is
one of the series designated on the face hereof, limited in aggregate principal
amount to $100,000,000.
The Securities of this Series are not subject to redemption prior to
maturity and shall not be subject to a sinking fund requirement.
The Indenture contains provisions for defeasance of (a) the entire
indebtedness of this Security and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth therein.
If an Event of Default with respect to the Securities of this series
shall occur and be continuing, the principal hereof may be declared due and
payable in the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of a majority in principal amount of the Securities
at the time Outstanding of each series to be affected. The Indenture also
contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
-3-
<PAGE> 7
As set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security of this series will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default with respect to this series, the Holders of not
less than 25% in principal amount of the Outstanding Securities of this series
shall have made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as trustee, and the Trustee shall not have
received from the Holders of a majority in principal amount of the Outstanding
Securities of this series a direction inconsistent with such request and shall
have failed to institute such proceeding within 60 days; provided, however,
that such limitations do not apply to a suit instituted by the Holder hereof
for the enforcement of payment of the principal of or interest on this Security
on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form,
without coupons, in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
-4-
<PAGE> 8
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security is overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Indenture and this Security shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Security which are defined in the Indenture
shall have the same meanings assigned to them in the Indenture.
PMR:tc
-5-
<PAGE> 1
EXHIBIT 5.1
(SULLIVAN AND CROMWELL LETTERHEAD)
November 30, 1994
Panhandle Eastern Corporation,
5400 Westheimer Court,
Houston, Texas 77056.
Dear Sirs:
In connection with the registration under the Securities Act
of 1933 (the "Act") of $100,000,000 principal amount of 8 5/8% Notes due
December 1, 1999 (the "Securities") of Panhandle Eastern Corporation, a
Delaware corporation (the "Company"), we, as your special counsel, have
examined such corporate records, certificates and other documents, and such
questions of law, as we have considered necessary or appropriate for the
purposes of this opinion.
Upon the basis of such examination, we advise you that, in our
opinion, when the Securities have been duly executed and authenticated in
accordance with the Indenture relating to the Securities and issued and sold as
contemplated in the Registration Statement, the Securities will constitute
valid and legally binding obligations of the
<PAGE> 2
Panhandle Eastern Corporation -2-
Company, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles.
The foregoing opinion is limited to the Federal laws of the
United States, the laws of the State of New York and the General Corporation
Law of the State of Delaware, and we are expressing no opinion as to the effect
of the laws of any other jurisdiction.
We have relied as to certain matters on information obtained
from public officials, officers of the Company and other sources believed by us
to be responsible, and we have assumed that the Indenture has been duly
authorized, executed and delivered by the Trustee thereunder, an assumption
which we have not independently verified.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to us under the heading
"Validity of Securities" in the Prospectus. In giving such consent, we do not
<PAGE> 3
Panhandle Eastern Corporation -3-
thereby admit that we are in the category of persons whose consent is required
under Section 7 of the Act.
Very truly yours,
SULLIVAN & CROMWELL
