As filed with the Securities and Exchange Commission on April 28, 1995
Registration No. 33-_____
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
____________________
TNP ENTERPRISES, INC.
(Exact Name of Registrant as Specified in its Charter)
Texas 75-1907501
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
4100 International Plaza, Tower II
Fort Worth, Texas 76109
(Address of Principal Executive Offices)
TNP ENTERPRISES, INC. EQUITY INCENTIVE PLAN
and
TNP ENTERPRISES, INC. NONEMPLOYEE DIRECTOR STOCK PLAN
(Full Title of the Plans)
____________________
Michael D. Blanchard
General Counsel
TNP Enterprises, Inc.
4100 International Plaza, Tower II
Fort Worth, Texas 76109
(817) 731-0099
(Name and Address of Agent for Service)
(Telephone Number, including area code)
____________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum Proposed Maximum
Title of Securities Amount to Offering Price Aggregate Offering Amount of
to be Registered be Registered Per Share(2) Price(2) Registration Fee
<S> <C> <C> <C> <C>
Common Stock,
no par value 330,000 $15.875 $5,238,750 $1,806.47
<F1>
(1) The securities to be registered are expected to be awarded
beginning April 28, 1995, effective January 1, 1995.
<F2>
(2) Offering price is based on the average high and low prices for one
share of TNP Enterprises, Inc. common stock as reported on the New
York Stock Exchange on April 24, 1995, pursuant to Rule 457(c) and
(h)(1).
</TABLE>
<PAGE>
PROSPECTUS
TNP ENTERPRISES, INC.
30,000 SHARES COMMON STOCK
(No Par Value)
ISSUED PURSUANT TO THE
TNP ENTERPRISES, INC. NONEMPLOYEE DIRECTOR STOCK PLAN
This Prospectus relates to 30,000 shares of common stock, no par
value ("Common Stock") of TNP Enterprises, Inc. (the "Company") to be
offered for the accounts of the Selling Shareholders (as defined in
this Prospectus under "Selling Shareholders"). The Common Stock to
which this Prospectus relates was or will be issued to nonemployee
directors of the Company under the TNP Enterprises, Inc. Nonemployee
Director Stock Plan (the "Plan"). The Company will not receive any
proceeds from sales of Common Stock by the Selling Shareholders. The
Selling Shareholders may offer to sell the Common Stock covered by
this Prospectus from time to time at prices and upon terms then
obtainable on the New York Stock Exchange, in negotiated
transactions, by underwriters pursuant to an underwriting agreement,
in a combination of any such methods of sale, or otherwise. The
Selling Shareholders and any broker-dealers (including underwriters)
who participate in sales of Common Stock covered by this Prospectus
may be deemed to be statutory underwriters within the meaning of the
Securities Act of 1933, as amended (the "Securities Act"). The
following may be deemed to be underwriting discounts and commissions
under the Securities Act: (i) Commissions paid, or discounts or
concessions allowed, to any such broker-dealers (including
underwriters) by any person and (ii) if any such broker-dealers
(including underwriters) purchases any Common Stock covered by this
Prospectus as a principal, then any profits received from reselling
such Common Stock. The Selling Shareholders or purchasers of Common
Stock will pay all discounts, commissions, and fees incurred in
selling Common Stock covered by this Prospectus, except that the
Company will pay the expenses of registering or qualifying the Common
Stock covered by this Prospectus with the Securities and Exchange
Commission (the "SEC") and under the blue sky laws of any applicable
jurisdiction.
The Common Stock is traded on the New York Stock Exchange ("NYSE")
under the symbol "TNP." On April 25, 1995, the average high and low
prices for one share of Common Stock on the NYSE was $15.875.
____________________
See "Experts" for certain considerations relevant to an investm
ent in the Common Stock.
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR 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 April 28, 1995.
<PAGE>
No person has been authorized to give any information or to make
any representations other than those contained in this Prospectus,
and, if given or made, such information or representations must not
be relied upon as having been authorized. This Prospectus does not
constitute an offer to sell or the solicitation of an offer to buy
any securities other than the securities to which it relates or any
offer to sell or the solicitation of an offer to buy such securities
in any circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus nor any sale hereunder shall,
under any circumstances, create any implication that there has been
no change in the Company's affairs since the date hereof or that the
information contained herein is correct as of any time subsequent to
its date.
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
AVAILABLE INFORMATION 2
THE COMPANY 3
SELLING SHAREHOLDERS 3
MANNER OF SALE 4
EXPERTS 4
DOCUMENTS INCORPORATED BY REFERENCE 4
</TABLE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). In
accordance with the Exchange Act, the Company files reports, proxy
statements, and other information with the SEC. The Company has also
filed with the SEC a registration statement on Form S-8 under the
Securities Act with respect to the Common Stock to which this
Prospectus relates. This Prospectus does not contain all of the
information set forth in the registration statement, certain parts of
which are omitted in accordance with the rules and regulations of the
SEC. Statements contained in this Prospectus concerning the
provisions of any document are not necessarily complete and, in each
instance, reference is hereby made to the copy of the document filed
as an exhibit to the registration statement.
The reports, proxy statements, and other information that the
Company files with the SEC and the registration statement described
above, including its exhibits, can be inspected and copied at the
SEC's office at Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549, and at the SEC's regional offices at Room 1028, Jacob K.
Javits Federal Building, 75 Park Place, New York, New York 10007, and
Kluczynski Federal Building, 230 South Dearborn Street, Chicago,
Illinois 60604. Copies of such material can also be obtained by mail
at prescribed rates from the SEC's Public Reference Section at its
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549.
The Common Stock is listed on the NYSE, and reports, proxy
statements, and other
-2-
<PAGE>
information concerning the Company can also be inspected at the
offices of the NYSE at 20 Broad Street, New York, New York 10009.
The Company will furnish without charge, upon written or oral
request, to each person, including any beneficial owner, to whom this
Prospectus is delivered, a copy of any and all information that has
been incorporated in this Prospectus by reference. Requests should
be directed to Investor Relations, TNP Enterprises, Inc., 4100
International Plaza, Tower II, Fort Worth, Texas 76109, telephone
number (817) 731-0099.
THE COMPANY
The Company is a Texas corporation and a holding company whose
principal wholly owned subsidiary is Texas-New Mexico Power Company
(the "Utility"). The Company is exempt from regulation as a
"registered holding company" as that term is defined in the Public
Utility Holding Company Act of 1935. The Company's principal
executive offices are located at 4100 International Plaza, Tower II,
Fort Worth, Texas 76109, telephone number (817) 731-0099.
The Utility is a public utility engaged in generating, purchasing,
transmitting, distributing, and selling electricity to customers in
Texas and New Mexico.
SELLING SHAREHOLDERS
The shareholders whose shares of Common Stock are covered by this
Prospectus ("Selling Shareholders") are the current or former
nonemployee directors of the Company from time to time who receive or
have received awards of Common Stock pursuant to the Plan. The
persons who are the Selling Shareholders are expected to change from
time to time as members of the board of directors changes. The
following table sets forth the names of the Selling Shareholders and
information with respect to Common Stock that each of them held of
record as of the date of this Prospectus and as adjusted to reflect
the sale of Common Stock pursuant to this Prospectus. All
information with respect to ownership has been furnished by the
respective Selling Shareholders.
<TABLE>
<CAPTION>
Common Stock Owned if all
Shares to be Shares Offered by this Prospectus
Amount of Offered by this are Sold
Common Stock Prospectus Percentage
Name Currently Owned Number of Shares Outstanding
<S> <C> <C> <C> <C>
R. D. Woofter 10,418 525 9,893 *
R. Denny Alexander 1,025 525 500 *
Cass O. Edwards, II 7,904 525 7,379 *
John A. Fanning 925 525 400 *
Sidney M. Gutierrez 525 525 0 *
Harris L. Kempner, Jr. 725 525 200 *
Dwight R. Spurlock 2,109 525 1,584 *
Dennis H. Withers 1,025 525 500 *
TOTAL 24,559 4,200 20,359 *
_______________
<F1>
* Less than 1%.
</TABLE>
-3-
<PAGE>
MANNER OF SALE
Sales of Common Stock covered by this Prospectus by the Selling
Shareholders may be made from time to time on one or more exchanges
or in the over-the-counter market, or otherwise, at prices and on
terms then prevailing or at prices related to the then current market
price, or in negotiated transactions. The shares may be sold by one
or more of the following: (a) block trade in which the broker or
dealer so engaged will attempt to sell the shares as agent but may
position and resell a portion of the block as principal to facilitate
the transaction; (b) purchases by a broker or dealer as principal and
resale by such broker or dealer for its own account pursuant to this
Prospectus; (c) an exchange distribution in accordance with the rules
of such exchange; (d) ordinary brokerage transactions and
transactions in which the broker solicits purchasers; and (e) a
combination of any such methods of sale. In effecting sales, brokers
or dealers engaged by the Selling Shareholders may arrange for other
brokers or dealers to participate. Brokers or dealers may receive
commissions or discounts from Selling Shareholders or from purchasers
in amounts to be negotiated immediately prior to the sale. Such
brokers or dealers and any other participating brokers or dealers may
be deemed to be "underwriters" within the meaning of the Securities
Act in connection with such sales.
In addition, any securities covered by this Prospectus that
qualify for sale pursuant to Rule 144 may be sold under Rule 144
rather than pursuant to this Prospectus.
EXPERTS
The consolidated financial statements of TNP Enterprises, Inc. and
subsidiaries as of December 31, 1994 and 1993, and for each of the
years in the three-year period ended December 31, 1994, have been
incorporated by reference herein and in the registration statement in
reliance upon the report of KPMG Peat Marwick LLP, independent
certified public accountants, incorporated by reference herein, and
upon the authority of such firm as experts in accounting and
auditing.
The report of KPMG Peat Marwick LLP covering the December 31,
1994, consolidated financial statements contains an explanatory
paragraph that states that uncertainties exist with respect to the
regulatory treatment of the income tax benefits of the regulatory
disallowances recognized in 1994. The consolidated financial
statements do not include any adjustments that might result from the
outcome of that uncertainty. The report also refers to changes in
the methods of accounting for income taxes and postretirement
benefits other than pensions in 1993.
DOCUMENTS INCORPORATED BY REFERENCE
All documents that the Company files with the SEC pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act, subsequent
to the date of this Prospectus and before termination of the offering
pursuant to this Prospectus are deemed to be incorporated by
reference in and to be a part of this Prospectus from the date of
filing such documents.
The following documents are incorporated in this Prospectus by
reference:
1. The Company's latest annual report on Form 10-K filed
pursuant to Sections 13(a) or 15(d) of the Exchange Act;
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<PAGE>
2. All other reports that the Company has filed pursuant to
Sections 13(a) or 15(d) of the Exchange Act since the end of the
fiscal year covered by the Company's latest annual report described
in 1. above; and
3. The descriptions of the Company's Common Stock set forth in
the Company's registration statement on Form 8-B, file number 1-
8847, filed pursuant to Section 12 of the Exchange Act and effective
February 1, 1985, as well as the Company's registration statement on
Form S-3, file number 33-53918, under the heading "Description of the
Common Stock," and any reports or amendments to the foregoing filed
with the SEC for the purpose of updating such descriptions.
-5-
<PAGE>
PART II
Item 3. Incorporation of Documents by Reference
All documents that TNP Enterprises, Inc. (the "Registrant") files
with the Securities and Exchange Commission pursuant to Sections
13(a), 13(c), 14, and 15(d) of the Securities Exchange Act of 1934,
subsequent to the date of this registration statement and before the
Registrant files a posteffective amendment indicating that all
securities offered pursuant to the TNP Enterprises, Inc. Equity
Incentive Plan and the TNP Enterprises, Inc. Nonemployee Director
Stock Plan (the "Plans") have been awarded or sold or deregistering
all securities then remaining unawarded or unsold shall be deemed to
be incorporated by reference in and to be a part of this
registration statement from the date of filing such documents.
The following documents are incorporated in this registration
statement by reference:
1. The Registrant's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
2. All other reports that the Registrant has filed pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of 1934 since
the end of the fiscal year covered by the Registrant's latest annual
report described in 1. above; and
3. The descriptions of the Registrant's common stock set forth
in the Registrant's registration statement on Form 8-B, file number
1-8847, filed pursuant to Section 12 of the Securities Exchange Act
of 1934 and effective February 1, 1985, as well as the Registrant's
registration statement on Form S-3, file number 33-53918, under the
heading "Description of the Common Stock," and any reports or
amendments to the foregoing filed with the Securities and Exchange
Commission for the purpose of updating such descriptions.
Item 4. Description of Securities
Inapplicable.
Item 5. Interests of Named Experts and Counsel
Inapplicable.
Item 6. Indemnification of Directors and Officers
Article 2.02-1 of the Texas Business Corporation Act is a
comprehensive provision that (i) defines the power of Texas
corporations to indemnify their directors, officers, employees, and
agents, (ii) identifies the standard of conduct that must be met by
such persons in order to be eligible for permissive corporate
indemnification and the circumstances under which indemnification by
the corporation otherwise is limited or prohibited, (iii)
establishes the procedures to be followed by the corporation in
determining whether a person has met the requisite standard of
conduct and, if so, whether and to what extent the corporation
should provide indemnification to such person, (iv) provides for
mandatory indemnification of directors and officers who are wholly
successful in defense of actions, unless the corporation's articles
of incorporation limit or deny this right, (v) provides to directors
and officers the ability to apply to a court of competent
jurisdiction for indemnification, which may be granted if the court
determines such director or officer is fairly and reasonably
entitled to indemnification (provided that such right may be limited
or denied by the corporation's
-II 1-
<PAGE>
articles of incorporation), (vi)
specifies the circumstances under which a corporation may advance
expenses of defense incurred by a director, officer, or other person
serving the corporation prior to the final disposition of the
proceeding, (vii) grants to corporations the power to purchase
director and officer liability insurance, (viii) authorizes
corporations, with shareholder approval, to implement self-insurance
arrangements for the benefit of directors, officers, employees, and
agents, whether or not the corporation would have the power to
indemnify such individuals under Article 2.02-1, and (ix) imposes
the requirement that corporations notify their shareholders of any
indemnification provided to directors.
Officers and directors of the Registrant are covered by
insurance which (with certain exceptions and within certain
limitations) indemnifies them against losses and liabilities arising
from any alleged "wrongful act" including any alleged error or
misstatement or misleading statement or wrongful act or omission or
neglect or breach of duty.
The Registrant's bylaws provide:
Indemnification.
5. The Corporation shall indemnify any Director, officer,
employee, or former Director, officer or employee of the
Corporation, or any person who has served at the
Corporation's request as a Director, officer or employee of
another Corporation in which the Corporation owns shares of
stock or of which it is a creditor against expenses actually
and necessarily incurred by him and any amount paid in
satisfaction of judgments in connection with any action, suit
or proceeding, whether civil or criminal, in which he is made
a party because of his service to the Corporation in one of
the above capacities subject to the following provisions.
6. Before a person requesting indemnity shall be entitled
to indemnity, it shall have been determined in the manner
provided in paragraph 7 that he:
a. conducted himself in good faith,
b. reasonably believed:
(1) his conduct in his official capacity was in the
Corporation's best interest, or
(2) where his conduct was not in his
official capacity, that his conduct was not opposed to
the Corporation's best interest; and where a criminal
proceeding is involved, he had no reasonable cause to
believe his conduct was unlawful.
7. For a person to be eligible for indemnification, a
determination of such eligibility shall be made by one of the
following means:
a. a majority vote of a quorum of Directors who are
not named parties in the proceeding at the time of vote,
b. where such a quorum cannot be obtained, by a
majority vote of a committee of the Board consisting of
Directors who are not parties in the proceeding at the
time of the vote,
c. by special legal counsel selected in the manner
as required by Statute, or
d. by a vote of the shareholders which excludes
those shares held by Directors who are parties to the
proceeding.
8. Reasonable expenses incurred by a person eligible for
indemnification may be reimbursed in advance of final
disposition of the proceeding if:
-II 2-
<PAGE>
a. the Corporation receives a written affirmation
by the Director of his good faith belief that he has met
the standard of conduct necessary for indemnification,
b. the Director provides a written obligation to
repay all amounts paid or reimbursed if it is ultimately
determined that he is not eligible for indemnification,
and
c. a determination of the facts known at the time
of the request for the advance reimbursement would not
preclude indemnification.
9. Where eligibility has been determined, a person may be
indemnified against judgments, penalties, fines, settlements,
and reasonable expenses actually incurred, provided that if
the proceeding is brought by or on behalf of the Corporation,
the indemnification is limited to reasonable expenses
actually incurred.
10. A person is not eligible for indemnification if:
a. the person is found liable on the basis of
personal benefit being improperly received by him
regardless of whether or not the benefit resulted form
action taken in the person's official capacity,
b. the person is found liable to the Corporation.
11. Such rights of indemnification and reimbursement shall
not be deemed exclusive of any other rights to which such
Director, officer, or employee may be entitled by law or
under any bylaw, vote of shareholders, agreement or
otherwise. The Corporation shall have the power to purchase
and maintain insurance on behalf of any person who is or was
a Director, officer, employee or agent of the Corporation or
is or was serving at the request of the Corporation as a
Director, officer, employee or agent of any other Corporation
against any liability asserted against him and incurred by
him in any such capacity or arising out of his status as
such, whether or not the Corporation would have the power to
indemnify him against such liability under the provision of
this section.
Item 7. Exemption from Registration Claimed
Inapplicable.
Item 8. Exhibits
The exhibits denoted by * below are filed with this registration
statement. The other exhibits listed below were filed previously
with the Securities and Exchange Commission and are incorporated in
this registration statement by reference to the filings noted
parenthetically.
Exhibit No. Exhibit
4(a) - Articles of Incorporation and Amendments
through March 6, 1984 (Exhibit 3(a), File No. 2-89800)
4(b) - Amendment to Articles of Incorporation filed
September 25, 1984 (Exhibit 3(b) to Form 10-K for the
year ended December 31, 1987)
4(c) - Amendment to Articles of Incorporation filed
August 29, 1985 (Exhibit 3(a) to Form 10-K for the year
ended December 31, 1985)
-II 3-
<PAGE>
4(d) - Amendment to Articles of Incorporation filed
June 2, 1986 (Exhibit 3(a) to Form 10-K for the year
ended December 31, 1986)
4(e) - Amendment to Articles of Incorporation filed
May 10, 1988 (Exhibit 3(e) to Form 10-K for the year
ended December 31, 1988)
4(f) - Amendment to Articles of Incorporation filed
May 10, 1988 (Exhibit 3(f) to Form 10-K for the year
ended December 31, 1988)
4(g) - Amendment to Articles of Incorporation filed
December 27, 1988 (Exhibit 3(g) to Form 10-K for the
year ended December 31, 1988)
4(h) - Bylaws of the Registrant, as amended November
15, 1994 (Exhibit 3(h) to Form 10-K for the year ended
December 31, 1994)
4(i)* - TNP Enterprises, Inc. Equity Incentive
Plan
4(j)* - TNP Enterprises, Inc. Nonemployee
Director Stock Plan
5* - Opinion of Michael D. Blanchard, Esq.
23(a)* - Consent of KPMG Peat Marwick LLP
23(b)* - Consent of Michael D. Blanchard, Esq.
(included in Exhibit 5)
24* - Power of Attorney (set forth on page II-6 of
this registration statement)
Item 9. Undertakings
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a posteffective amendment to this registration statement: (i)
to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; (ii) to reflect in the prospectus any facts
or events arising after the effective date of the registration
statement (or the most recent posteffective amendment thereof) that,
individually or in the aggregate, represent a fundamental change in
the information set forth in the registration statement; and (iii)
to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement; provided, however, that clauses (1)(i) and (1)(ii) do
not apply if the registration statement is on Form S-3, Form S-8,
and the information required to be included in a posteffective
amendment by those clauses is contained in periodic reports filed by
the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement;
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such posteffective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof;
(3) to remove from registration by means of a posteffective
amendment any of the securities being registered that remain unsold
at the termination of the offering; and
(4) that, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual
report pursuant to Sections 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(5) to deliver or cause to be delivered with the prospectus, to
each person to whom the prospectus is sent or given, the latest
annual report to security holders that is incorporated by reference
in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities
Exchange Act of 1934; and, where interim financial information
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<PAGE>
required to be presented by Article 3 of Regulation S-X is not set
forth in the prospectus, to deliver, or cause to be delivered to
each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and
controlling persons of the Registrant pursuant to the provisions
described in Item 6 of this registration statement, or otherwise,
the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. If a claim for indemnification against
such liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer, or controlling
person of the Registrant in the successful defense of any action,
suit, or proceeding) is asserted by such director, officer, or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final
adjudication of such issue.
-II 5-
<PAGE>
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-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Fort Worth, State of Texas, on this
27th day of April, 1995.
TNP ENTERPRISES, INC.
By: \s\ Kevern R. Joyce
KEVERN R. JOYCE, President &
Chief Executive Officer
POWER OF ATTORNEY
Each individual whose signature appears below constitutes and appoints
Manjit S. Cheema and Michael D. Blanchard, and each of them, such person's
true and lawful attorneys-in-fact and agents with full power of substitution
and resubstitution, for such person and in such person's name, place, and
stead, in any and all capacities, to sign any and all amendments (including
posteffective amendments) to this Registration Statement, and to file the
same with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorneys-in-
fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about
the premises, as fully to all intents and purposes as such person might or
could do in person, hereby ratifying and confirming all that said attorneys-
in-fact and agents or any of them, or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
\s\ R. D. Woofter Chairman April 27, 1995
R. D. WOOFTER
\s\ Kevern R. Joyce President & Chief April 27, 1995
KEVERN R. JOYCE Executive Officer
\s\ M. S. Cheema Vice President & Chief April 27, 1995
MANJIT S. CHEEMA Financial Officer
\s\ Monte W. Smith Treasurer (Principal April 27, 1995
MONTE W. SMITH Accounting Officer)
\s\ R. Denny Alexander Director April 27, 1995
R. DENNY ALEXANDER
\s\ Cass O. Edwards,II Director April 27, 1995
CASS O. EDWARDS, II
\s\ John A. Fanning Director April 27, 1995
JOHN A. FANNING
\s\ Sidney M. Gutierrez Director April 27, 1995
SIDNEY M. GUTIERREZ
\s\ Harris L. Kempner Jr. Director April 27, 1995
HARRIS L. KEMPNER, JR.
\s\ Dwight R. Spurlock Director April 27, 1995
DWIGHT R. SPURLOCK
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<PAGE>
INDEX TO EXHIBITS
The exhibits denoted by * below are filed with this registration statement.
The other exhibits listed below were filed previously with the Securities and
Exchange Commission and are incorporated in this registration statement by
reference to the filings noted parenthetically.
Exhibit No. Exhibit
4(a) - Articles of Incorporation and Amendments through March
6, 1984 (Exhibit 3(a), File No. 2-89800)
4(b) - Amendment to Articles of Incorporation filed September
25, 1984 (Exhibit 3(b) to Form 10-K for the year ended December
31, 1987)
4(c) - Amendment to Articles of Incorporation filed August 29,
1985 (Exhibit 3(a) to Form 10-K for the year ended December 31,
1985)
4(d) - Amendment to Articles of Incorporation filed June 2,
1986 (Exhibit 3(a) to Form 10-K for the year ended December 31,
1986)
4(e) - Amendment to Articles of Incorporation filed May 10,
1988 (Exhibit 3(e) to Form 10-K for the year ended December 31,
1988)
4(f) - Amendment to Articles of Incorporation filed May 10,
1988 (Exhibit 3(f) to Form 10-K for the year ended December 31,
1988)
4(g) - Amendment to Articles of Incorporation filed December
27, 1988 (Exhibit 3(g) to Form 10-K for the year ended December
31, 1988)
4(h) - Bylaws of the Registrant, as amended November 15, 1994
(Exhibit 3(h) to Form 10-K for the year ended December 31, 1994)
4(i)* - TNP Enterprises, Inc. Equity Incentive Plan
4(j)* - TNP Enterprises, Inc. Nonemployee Director Stock
Plan
5* - Opinion of Michael D. Blanchard, Esq.
23(a)* - Consent of KPMG Peat Marwick LLP
23(b)* - Consent of Michael D. Blanchard, Esq. (included in
Exhibit 5)
24* - Power of Attorney (set forth on page II-6 of this
registration statement)
-II 7-
<PAGE>
TNP ENTERPRISES, INC. EQUITY INCENTIVE PLAN
Article 1. Establishment, Purpose, and Duration
1.1 Establishment of the Plan. TNP Enterprises, Inc., a
Texas corporation (hereinafter referred to as the
"Company"), hereby establishes an incentive compensation
plan to be known as the "TNP Enterprises, Inc. Equity
Incentive Plan" (hereinafter referred to as the "Plan"), as
set forth in this document. The Plan permits the grant of
Nonqualified Stock Options, Incentive Stock Options,
Restricted Stock, Performance Units, Performance Shares, and
Other Stock-Based Awards.
Subject to approval by the Company's shareholders, the
Plan shall become effective as of January 1, 1995 (the
"Effective Date"), and shall remain in effect as provided in
Section 1.3 herein.
1.2 Purpose of the Plan. The purpose of the Plan is to
promote the success and enhance the value of the Company by
linking the personal interests of Participants to those of
Company shareholders, and by providing Participants with an
incentive for outstanding performance.
The Plan is further intended to provide flexibility to the Company
in its ability to motivate, attract, and retain the services
of Participants upon whose judgment, interest, and special
effort the successful conduct of its operation largely is
dependent.
1.3 Duration of the Plan. The Plan shall commence on the Effective
Date, as described in Section 1.1 herein, and shall remain
in effect, subject to the right of the Board of Directors to
terminate the Plan at any time pursuant to Article 15
herein, until all Shares subject to it shall have been
purchased or acquired according to the Plan's provisions.
However, in no event may an Award be granted under the Plan
on or after January 1, 2005.
Article 2. Definitions
Whenever used in the Plan, the following terms shall have
the meanings set forth below and, when the meaning is
intended, the initial letter of the word is capitalized:
(a) "Award" means, individually or collectively, a grant
under this Plan of Nonqualified Stock Options, Incentive
Stock Options, Restricted Stock, Performance Units,
Performance Shares, or Other Stock-Based Awards.
(b) "Award Agreement" means an agreement entered into by
each Participant and the Company, setting forth the terms
and provisions applicable to Awards granted to
Participants under this Plan.
(c) "Beneficial Owner" shall have the meaning ascribed
to such term in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act.
(d) "Board" or "Board of Directors" means the Board of
Directors of the Company.
(e) "Cause" means the admission by or the conviction
of the Participant of an act of fraud, embezzlement,
theft, or other criminal act constituting a felony
under laws involving moral turpitude. The Board of
Directors, by majority vote, shall make the
determination of whether Cause exists.
(f) "Change in Control" shall have the meaning
ascribed to such term in the Texas-New Mexico Power
Company Executive Agreement for Severance Compensation
Upon Change in Control.
(g) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
<PAGE>
(h) "Committee" means the committee, as specified in
Article 3, appointed by the Board to administer the
Plan.
(i) "Company" means TNP Enterprises, Inc., a Texas
corporation, and the Company's subsidiaries, as well as
any successor thereto as provided in Article 18 herein.
(j) "Director" means any individual who is a member of the Board
of Directors of the Company.
(k) "Disability" shall have the meaning ascribed to such term in
the Participants' governing long-term disability plan.
(l) "Dividend Equivalent" means a contingent right to be paid
dividends declared with respect to outstanding Awards, pursuant
to the terms of Sections 6.5 and 8.3 herein.
(m) "Employee" means any full-time, nonunion employee of the
Company or of the Company's Subsidiaries. Directors who are not
otherwise employed by the Company shall not be considered
Employees under this Plan.
(n) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor Act thereto. (o)
"Fair Market Value" means the Fair Market Value of the Shares
determined by such methods or procedures as shall be established
from time to time by the Committee; provided, however, that so
long as the Shares are traded in a public
market, Fair Market Value means the average of the high and low
prices of a Share in the principal market for the Shares on the
specified date (or, if no sales occurred on such date, the last
preceding date on which sales occurred).
(p) "Incentive Stock Option" or "ISO" means an option to
purchase Shares, granted under Article 6 herein, which is
designated as an Incentive Stock Option and is intended to meet
the requirements of Section 422 of the Code, or any successor
provision thereto.
(q) "Insider" shall mean an Employee who is, on the relevant
date, an officer, director, or ten percent (10%) Beneficial Owner
of any class of the Company's equity securities that is
registered pursuant to Section 12 of the Exchange Act, all as
defined under Section 16 of the Exchange Act.
(r) "Named Executive Officer" means a Participant who, as of the
date of vesting and/or payout of an Award, as applicable, is one
of the group of "covered employees," as defined in the
regulations promulgated under Code Section 162(m), or any
successor statute.
(s) "Nonqualified Stock Option" or "NQSO" means an option to
purchase Shares, granted under Article 6 herein, which is not
intended to be an Incentive Stock Option.
(t) "Option" means an Incentive Stock Option or a Nonqualified
Stock Option.
(u) "Option Price" means the price at which a Share may be
purchased by a Participant pursuant to an Option, as determined
by the Committee.
(v) "Other Stock-Based Award" means an Award granted pursuant to
Article 9 hereof.
(w) "Participant" means an Employee of the Company who has
outstanding an Award granted under the Plan.
(x) "Performance-Based Exception" means the performance-based
exception from the tax deductibility limitations of Code Section 162(m).
(y) "Performance Unit" means an Award granted to an Employee, as
described in Article 8 herein.
(z) "Performance Share" means an Award granted to an Employee,
as described in Article 8 herein.
<PAGE>
(aa) "Period of Restriction" means the period during which the
transfer of Shares of Restricted Stock is limited in some way
(based on the passage of time, the achievement of performance
goals, or upon the occurrence of other events as determined by
the Committee, at its discretion), and the Shares are subject to
a substantial risk of forfeiture, as provided in Article 7
herein.
(ab) "Person" shall have the meaning ascribed to such term in
Section 3(a)(9) of the Exchange Act and used in Sections 13(d)
and 14(d) thereof, including a "group" as defined in Section
13(d).
(ac) "Restricted Stock" means an Award granted to a Participant
pursuant to Article 7 herein.
(ad) "Retirement" shall have the meaning ascribed to such term in
the Participants' governing Company-sponsored Retirement plan.
(ae) "Shares" means Shares of common stock of the Company. (af)
"Subsidiary" means any corporation in which the Company owns
directly, or indirectly through subsidiaries, at least fifty
percent (50%) of the total combined voting power of all classes of
stock, or any other entity (including, but not limited to,
partnerships and joint ventures) in which the
Company owns at least fifty percent (50%) of the combined equity
thereof.
(ag) "Window Period" means the period beginning on the third
business day following the date of public release of the Company's
quarterly sales and earnings information, and ending on the twelfth
(12th) business day following such date.
Article 3. Administration
3.1 The Committee. The Plan shall be administered by the Personnel,
Organization, and Nominating Committee of the Board or by any other
Committee appointed by the Board consisting of not less than two (2)
Directors. The members of the Committee shall be appointed from time to
time by, and shall serve at the discretion of, the Board of Directors.
The Committee shall be comprised solely of Directors who are
eligible to administer the Plan pursuant to Rule 16b-3(c)(2) under the
Exchange Act.
3.2 Authority of the Committee. The Committee shall have full power
except as limited by law or by the Articles of Incorporation or Bylaws
of the Company, and subject to the provisions herein, to designate
employees to be Participants in the Plan; to determine the size and
types of Awards; to determine the terms and conditions of such Awards in
a manner consistent with the Plan; to determine whether, to what extent,
and under what circumstances, Awards granted to Participants may be
settled or exercised in cash, Shares or other property; to construe and
interpret the Plan and any agreement or instrument entered into under
the Plan; to establish, amend, or waive rules and regulations for the
Plan's administration; and (subject to the provisions of Article 15
herein) to amend the terms and conditions of any outstanding Award to
the extent such terms and conditions are within the discretion of the
Committee as provided in the Plan. Further, the Committee shall make all
other determinations which may be necessary or advisable for the
administration of the Plan. As permitted by law, the Committee may
delegate its authorities as identified hereunder.
3.3 Decisions Binding. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan and all related orders
or resolutions of the Board shall be final, conclusive, and binding on
all persons, including the Company, its shareholders, Employees,
Participants, and their estates and beneficiaries.
Article 4. Shares Subject to the Plan
4.1 Number of Shares Available for Grants. Subject to adjustment as
provided in section 4.3 herein, the number of Shares hereby reserved for
issuance to Participants under the Plan shall be three hundred
<PAGE>
thousand (300,000); provided, however, that the maximum number of Shares of
Restricted Stock granted pursuant to Article 7 herein, shall be one
hundred thousand (100,000).
Unless and until the Committee determines that an Award to a Named
Executive Officer shall not be designed to comply with the Performance
Based Exception, the following rules shall apply to grants of such
Awards to any Named Executive Officer under the Plan:
(a) The maximum annual aggregate number of Options/SARs that may
be granted shall be seventy-five thousand (75,000); and
(b) The maximum annual aggregate number of Restricted Shares
that may be granted shall be twenty-five thousand (25,000); and
(c) The maximum annual aggregate number of Performance Shares
that may be granted shall be thirty thousand (30,000); and (d)
The maximum annual aggregate cash payout with respect to Awards
granted pursuant to Articles 8 and 9 herein which may be made to
any Named Executive Officer shall be four hundred fifty thousand
dollars ($450,000); and
(e) The maximum annual aggregate number of Shares granted under
Article 9 herein shall be forty thousand (40,000).
4.2 Lapsed Awards. If any Award granted under this Plan is canceled,
terminates, expires, or lapses for any reason, any Shares subject to
such Award again shall be available for the grant of an Award under the
Plan. However, in the event that prior to the Award's cancellation,
termination, expiration, or lapse, the holder of the Award at any time
received one or more "benefits of ownership" pursuant to such Award (as
defined by the Securities and Exchange Commission, pursuant to any rule
or interpretation promulgated under Section 16 of the Exchange Act),
the Shares subject to such Award shall not be made available for
regrant under the Plan.
4.3 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation,
liquidation, stock dividend, split-up, Share combination, or other
change in the corporate structure of the Company affecting the Shares,
such adjustment shall be made in the number and class of Shares which
may be delivered under the Plan, and in the number and class of and/or
price of Shares subject to outstanding Awards granted under the Plan,
as may be determined to be appropriate and equitable by the Committee,
in its sole discretion, to prevent dilution or enlargement of rights;
and provided that the number of Shares subject to any Award shall
always be a whole number.
Article 5. Eligibility and Participation
5.1 Eligibility. Persons eligible to participate in this Plan
include all active Employees of the Company and its Subsidiaries, as
determined by the Committee, including Employees who are members of the
Board, but excluding Directors who are not Employees.
5.2 Actual Participation. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees,
those to whom Awards shall be granted and shall determine the nature
and amount of each Award.
Article 6. Stock Options
6.1 Grant of Options. Subject to the terms and provisions of the
Plan, Options may be granted to Employees at any time and from time to
time as shall be determined by the Committee. The Committee shall have
discretion in determining the number of Shares subject to Options
granted to each Participant. The Committee may grant ISOs, NQSOs, or a
combination thereof.
<PAGE>
6.2 Award Agreement. Each Option grant shall be evidenced by an
Award Agreement that shall specify the Option Price, the duration of
the Option, the number of Shares to which the Option pertains, and such
other provisions as the Committee shall determine. The Award Agreement
also shall specify whether the Option is intended to be an ISO within
the meaning of Section 422 of the Code, or a NQSO whose grant is
intended not to fall under the Code provisions of Section 422.
6.3 Option Price. The Option Price for each grant of an Option under
this Section 6.3 shall be at least equal to one hundred percent (100%)
of the Fair Market Value of a Share on the date the Option is granted.
6.4 Duration of Options. Each Option shall expire at such time as
the Committee shall determine at the time of grant; provided, however,
that no Option shall be exercisable later than the tenth (10th)
anniversary date of its grant.
6.5 Dividend Equivalents. Simultaneous with the grant of a
Nonqualified Stock Option, the Participant receiving the Option may be
granted, at no additional cost, under any terms and conditions set
forth by the Committee, Dividend Equivalents. Each Dividend Equivalent
shall entitle the Participant to receive a contingent right to be paid
an amount equal to the dividends declared on a Share on all record
dates occurring during the period between the grant date of an Option
and the date the Option is exercised.
The underlying value of each Dividend Equivalent shall accrue as a
book entry in the name of each Participant holding the Dividend
Equivalent. Payout of the accrued value of a Dividend Equivalent shall
occur only in the event the Option issued in tandem with the Dividend
Equivalent is "in the money" (i.e., the Fair Market Value of Shares
underlying the Option as of the exercise date exceeds the Option Price)
as of the exercise date. Payout of Dividend Equivalents shall be made
in cash or Shares, in one lump sum, within thirty (30) days following
the exercise of the corresponding Option, subject to such terms and
conditions as the Committee deems appropriate.
6.6 Exercise of Options. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions and
conditions as the Committee shall in each instance approve, which need
not be the same for each grant or for each Participant.
6.7 Payment. Options shall be exercised by the delivery of a written
notice of exercise to the Company, setting forth the number of Shares
with respect to which the Option is to be exercised, accompanied by
full payment for the Shares.
The Option Price upon exercise of any Option shall be payable to the
Company in full either: (a) in cash or its equivalent, or (b) by
tendering previously acquired Shares having an aggregate Fair Market
Value at the time of exercise equal to the total Option Price (provided
that the Shares which are tendered must have been held by the
Participant for at least six (6) months prior to their tender to
satisfy the Option Price), or (c) by a combination of (a) and (b), as
specified by the Committee.
The Committee also may allow cashless exercises as permitted under
Federal Reserve Board's Regulation T, subject to applicable securities
law restrictions, or by any other means which the Committee determines
to be consistent with the Plan's purpose and applicable law.
As soon as practicable after receipt of a written notification of
exercise and full payment, the Company shall deliver to the
Participant, in the Participant's name, Share certificates in an
appropriate amount based upon the number of Shares purchased under the
Option(s).
6.8 Termination of Employment. Each Participant's Award Agreement
shall set forth the extent to which the Participant shall have the
right to exercise the Option following termination of the Participant's
employment with the Company and/or its Subsidiaries. Such provisions
shall be determined in the sole discretion of the Committee, shall be
included in the Award Agreement entered into with each Participant,
need not be uniform among all Options issued pursuant to this Article
6, and may reflect distinctions based on the reasons for termination of
employment.
<PAGE>
6.9 Nontransferability of Options. No Option granted under the Plan
may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, all Options granted to a Participant under the
Plan shall be exercisable during his or her lifetime only by such
Participant, or, if permissible under applicable law, by such
Participant's guardian or legal representative.
Article 7. Restricted Stock
7.1 Grant of Restricted Stock. Subject to the terms and provisions
of the Plan, the Committee, at any time and from time to time, may
grant Shares of Restricted Stock to eligible Employees in such amounts
as the Committee shall determine.
7.2 Restricted Stock Agreement. Each Restricted Stock grant shall be
evidenced by an Award Agreement that shall specify the Period of
Restriction, or Periods, the number of Restricted Stock Shares
granted, and such other provisions as the Committee shall determine.
7.3 Transferability. Except as provided in this Article 7, the
Shares of Restricted Stock granted herein may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated until the end
of the applicable Period of Restriction established by the Committee
and specified in the Award Agreement, or upon earlier satisfaction of
any other conditions, as specified by the Committee in its sole
discretion and set forth in the Award Agreement. All rights with
respect to the Restricted Stock granted to a Participant under the Plan
shall be available during his or her lifetime only to such Participant.
7.4 Other Restrictions. The Committee shall impose such other
conditions and/or restrictions on any Shares of Restricted Stock
granted pursuant to the Plan as it may deem advisable including,
without limitation, a requirement that Participants pay a stipulated
purchase price for each Share of Restricted Stock, restrictions based
upon the achievement of specific performance goals (Company-wide,
divisional, and/or individual), and/or restrictions under applicable
Federal or state securities laws; and may legend the certificates
representing Restricted Stock to give appropriate notice of such
restrictions.
7.5 Certificate Legend. In addition to any legends placed on
certificates pursuant to Section 7.4 herein, each certificate
representing Shares of Restricted Stock granted pursuant to the Plan
may bear the following legend:
"The sale or other transfer of the Shares of stock
represented by this certificate, whether voluntary,
involuntary, or by operation of law, is subject to certain
restrictions on transfer as set forth in the TNP Enterprises, Inc.
Equity Incentive Plan, and in an Award Agreement. A copy of the
Plan and such Award Agreement may be obtained from TNP
Enterprises, Inc."
The Company shall have the right to retain the certificates
representing Shares of Restricted Stock in the Company's possession
until such time as all conditions and/or restrictions applicable to
such Shares have been satisfied.
7.6 Removal of Restrictions. Except as otherwise provided in this
Article 7, Shares of Restricted Stock covered by each Restricted Stock
grant made under the Plan shall become freely transferable by the
Participant after the last day of the Period of Restriction. Once the
Shares are released from the restrictions, the Participant shall be
entitled to have the legend required by Section 7.5 removed from his or
her Share certificate.
7.7 Voting Rights. During the Period of Restriction, Participants
holding Shares of Restricted Stock granted hereunder may exercise full
voting rights with respect to those Shares.
7.8 Dividends and Other Distributions. During the Period of
Restriction, Participants holding Shares of Restricted Stock granted
hereunder may be credited with all regular cash dividends paid with
respect to all Shares while they are so held. Except as provided in the
succeeding sentence, all other cash dividends
<PAGE>
and other distributions
paid with respect to Shares of Restricted Stock may be credited to
Participants subject to the same restrictions on transferability and
forfeitability as the Shares of Restricted Stock with respect to which
they were paid. If any such dividends or distributions are paid in
Shares, the Shares shall be subject to the same restrictions on
transferability and forfeitability as the Shares of Restricted Stock
with respect to which they were paid. Subject to the succeeding
paragraph, all dividends credited to a Participant shall be paid to the
Participant within forty-five (45) days following the full vesting of
the Shares of Restricted Stock with respect to which such dividends
were earned.
7.9 Termination of Employment. Each Award Agreement shall set forth
the extent to which the Participant shall have the right to receive
unvested Restricted Shares following termination of the Participant's
employment with the Company and/or its Subsidiaries. Such provisions
shall be determined in the sole discretion of the Committee, shall be
included in the Award Agreement entered into with each Participant,
need not be uniform among all Shares of Restricted Stock issued
pursuant to the Plan, and may reflect distinctions based on the reasons
for termination of employment; provided, however, that except in the
cases of terminations connected with a Change in Control and
terminations by reason of death or Disability, the vesting of Shares of
Restricted Stock which qualify for the Performance-Based Exception and
which are held by Named Executive Officers shall occur at the time they
otherwise would have, but for the employment termination.
Article 8. Performance Units and Performance Shares
8.1 Grant of Performance Units/Shares. Subject to the terms of the
Plan, Performance Units and Performance Shares may be granted to
eligible Employees at any time and from time to time, as shall be
determined by the Committee. The Committee shall have complete
discretion in determining the number of Performance Units and
Performance Shares granted to each Participant.
8.2 Award Agreement. Each Performance Share/Unit grant shall be
evidenced by an Award Agreement that shall specify the number of
Performance Shares/United granted, the value of each Performance
Share/Unit granted, the Performance Period, the performance measures,
and such other provisions as the Committee may determine.
8.3 Value of Performance Units/Shares. Each Performance Unit shall
have an initial value that is established by the Committee at the time
of grant. Each Performance Share shall have an initial value equal to
the Fair Market Value of a Share on the date of grant. The Committee
shall set performance goals in its discretion which, depending on the
extent to which they are met, will determine the number and/or value of
Performance Units/Shares that will be paid out to the Participants. The
time period during which the performance goals must be met shall be
called a "Performance Period." Performance Periods shall, in all cases,
exceed six (6) months in length.
8.4 Dividend Equivalents. Simultaneous with the grant of Performance
Units/Shares, the Participant receiving the Performance Units/Shares
may be granted, at no additional cost, Dividend Equivalents. Each
Dividend Equivalent shall entitle the Participant to receive a
contingent right to be paid an amount equal to the dividends declared
on a Share on all record dates occurring during the period between the
grant of Performance Units/Shares and the date the Performance
Units/Shares are earned, subject to such terms and conditions as the
Committee deems appropriate.
The underlying value of each Dividend Equivalent shall accrue as a
book entry in the name of each Participant holding the Dividend
Equivalent. Payout of the accrued value of a Dividend Equivalent may be
contingent on the achievement of performance goal(s) set by the
Committee which, depending on the extent to which they are met, will
determine the number and/or value of Dividend Equivalents that will be
paid out to the Participants. Notwithstanding the foregoing, the
Company or Subsidiary performance measures to be used for purposes of
grants to Named Executive Officers shall be chosen from and subject to
the conditions specified in Article 10 hereof.
<PAGE>
Payout of Dividend Equivalents shall be made in cash or Shares or a
combination thereof, as determined by the Committee, in one (1) lump
sum, within thirty (30) days following the payout of Performance
Units/Shares.
8.5 Earning of Performance Units/Shares. After the applicable
Performance Period has ended, the holder of Performance Units/Shares
shall be entitled to receive payout on the number and value of
Performance Units/Shares earned by the Participant over the Performance
Period, to be determined by the Committee as a function of the extent
to which the corresponding performance goals have been achieved.
8.6 Form and Timing of Payment of Performance Units/Shares. Payment
of earned Performance Units/Shares shall be made in a single lump sum,
within seventy-five (75) calendar days following the close of the
applicable Performance Period. The Committee, in its sole discretion, may
pay earned Performance Units/Shares in the form of cash or in Shares (or
in a combination thereof), which have an aggregate Fair Market Value
equal to the value of the earned Performance Units/Shares at the close of
the applicable Performance Period. Such Shares may be granted subject to
any restrictions deemed appropriate by the Committee.
At the discretion of the Committee, Participants may be entitled to
receive any dividends declared with respect to Shares which have been
earned in connection with grants of Performance Units and/or Performance
Shares which have been earned, but not yet distributed to Participants.
(Such dividends shall be subject to the same accrual, forfeiture, and
payout restrictions as apply to dividends earned with respect to Shares
of Restricted Stock, as set forth in Section 7.8 herein.) In addition,
Participants may, at the discretion of the Committee, be entitled to
exercise their voting rights with respect to such Shares.
8.7 Termination of Employment Due to Death, Disability, Retirement, or
Involuntary Termination Without Cause. In the event the employment of a
Participant is terminated by reason of death, Disability, Retirement, or
involuntary termination without Cause during a Performance Period, the
Participant shall receive a prorated payout of the Performance
Units/Shares. The prorated payout shall be determined by the Committee,
in its sole discretion, and shall be based upon the length of time that
the Participant held the Performance Units/Shares during the Performance
Period, and shall further be adjusted based on the achievement of the
preestablished performance goals.
Payment of earned Performance Units/Shares shall be made at the same
time payments are made to Participants who did not terminate employment
during the applicable Performance Period.
8.8 Termination of Employment for Other Reasons. In the event that a
Participant's employment terminates for any reason other than those
reasons set forth in Section 8.7 herein, all Performance Units/Shares
shall be forfeited by the Participant to the Company. The Committee,
however, in its sole discretion, shall have the right to make payment of
Awards for any Performance Periods coincident with terminations pursuant
to this Section 8.8.
8.9 Nontransferability. Except as provided in a Participant's Award
Agreement, Performance Units/Shares may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by
will or by the laws of descent and distribution. Further, a Participant's
rights under the Plan shall be exercisable during the Participant's
lifetime only by the Participant or the Participant's legal
representative.
Article 9. Other Stock-Based Awards
Subject to the terms of the Plan, Other Stock-Based Awards may be
granted to eligible Employees at any time and from time to time and in
such amounts and upon such terms as the Committee deems appropriate.
<PAGE>
Article 10. Performance Measures
Unless and until the Committee proposes for shareholder vote and
shareholders approve a change in the general performance measures set
forth in this Article 10, the attainment of which may determine the
degree of payout and/or vesting with respect to Awards to Named
Executive Officers which are designed to qualify for the Performance-
Based Exception, the performance measure(s) to be used for purposes of
such grants shall be chosen from among the following alternatives:
* Earnings per share;
* Measurements of cost control effectiveness such as the ratio of
operations and maintenance costs to kilowatt hour sales;
* Measurements of community involvement and customer satisfaction;
* Measurements of anticipation and resolution of environmental
issues;
* Measurements of reliability such as the equivalent forced outage
rate, minutes of outage per customer served, and number of customers
interrupted per customer served;
* Measurements of employee safety;
* Measurements of long-term rate competitiveness; and
* Total shareholder return compared to one or more groups as
determined by the Incentive Plan Committee.
The Committee shall have the discretion to adjust the determinations
of the degree of attainment of the preestablished performance goals;
provided, however, that Awards which are designed to qualify for the
Performance-Based Exception, and which are held by the Named Executive
officers, may not be adjusted upward. (The Committee shall retain the
discretion to adjust such Awards downward.)
In the event that applicable tax and/or securities laws change to
permit Committee discretion to alter the governing performance measures
without obtaining shareholder approval of such changes, the Committee
shall have sole discretion to make such changes without obtaining
shareholder approval. In addition, in the event the Committee
determines it is advisable to grant Awards which shall not qualify for
the Performance-Based Exception, the Committee may make such grants
without satisfying the requirements of Code Section 162(m).
Article 11. Beneficiary Designation
Each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit under the Plan is to be paid in case
of his or her death before he or she receives any or all of such
benefit. Each such designation shall revoke all prior designations by
the same Participant, shall be in a form prescribed by the Company, and
will be effective only when filed by the Participant in writing with
the Company during the Participant's lifetime. In the absence of any
such designation, benefits remaining unpaid at the Participant's death
shall be paid to the Participant's estate.
The spouse of a married Participant domiciled in a community property
jurisdiction shall join in any designation of beneficiary or
beneficiaries other than the spouse.
Article 12. Deferrals
The Committee, in its sole discretion, may permit or require a
Participant to defer such Participant's receipt of the payment of cash
or the delivery of Shares that would otherwise be due to such
Participant by virtue of the exercise of an Option or the lapse or
waiver of restrictions with respect to Restricted Stock, or the
satisfaction of any requirements or goals with respect to Performance
Units/Shares or Other Stock-Based Awards hereunder. If any such
deferral election is required or permitted, the Committee shall, in its
sole discretion, establish rules and procedures for such payment
deferrals.
<PAGE>
Article 13. Rights of Employees
13.1 Employment. Nothing in the Plan shall interfere with or limit in
any way the right of the Company to terminate any Participant's
employment at any time, nor confer upon any Participant any right to
continue in the employ of the Company.
For purposes of the Plan, transfer of employment of a Participant
between the Company and any one of its Subsidiaries, or vice-versa, (or
between Subsidiaries) shall not be deemed a termination of employment.
Upon such a transfer, the Committee may make such adjustments to
outstanding Awards as it deems appropriate to reflect the changed
reporting relationships.
13.2 Participation. No Employee shall have the right to be selected
to receive an Award under this Plan, or, having been so selected, to be
selected to receive a future Award.
Article 14. Change in Control
Upon the occurrence of a Change in Control, unless otherwise
specifically prohibited by applicable law or by the rules and
regulations of any governmental agencies or national securities
exchanges:
(a) Any and all Options granted hereunder shall become
immediately exercisable;
(b) Any Period of Restriction and restrictions imposed on
Restricted Shares shall lapse;
(c) The target payout opportunity attainable under all
outstanding Awards of Restricted Stock, Performance Units,
Performance Shares, and Other Stock-Based Awards shall be deemed
to have been fully earned for the entire Performance Period(s) as
of the effective date of the Change in Control. The vesting of all
Awards denominated in Shares shall be accelerated as of the
effective date of the Change in Control, and there shall be paid
out in cash to Participants within thirty (30) days following the
effective date of the Change in Control the full portion of such
target payout opportunity; provided, however, that there shall not
be an accelerated payout with respect to Restricted Stock,
Performance Units, Performance Shares, and Other Stock-Based
Awards which were granted less than six (6) months prior to the
effective date of the Change in Control; and
(d) Subject to Article 15 herein, the Committee shall have the
authority to make any modifications to the Awards as determined by
the Committee to be appropriate before the effective date of the
Change in Control.
Article 15. Amendment, Modification, and Termination
15.1 Amendment, Modification, and Termination. The Board may, at any
time, and from time to time, alter, amend, suspend or terminate the
Plan in whole or in part; provided, that no amendment which requires
shareholder approval in order for the Plan to continue to comply with
Rule 16b-3 under the Exchange Act, including any successor to such
Rule, shall be effective unless such amendment shall be approved by the
requisite vote of shareholders of the Company entitled to vote thereon.
The Committee shall not have the authority to cancel outstanding
Awards and issue substitute Awards in replacement thereof.
15.2 Awards Previously Granted. No termination, amendment, or
modification of the Plan shall adversely affect in any material way any
Award previously granted under the Plan, without the written consent of
the Participant holding such Award.
15.3 Compliance With Code Section 162(m). At all times when Code
Section 162(m) is applicable, all Awards granted under this Plan shall
comply with the requirements of Code Section 162(m); provided, however,
that in the event the Committee determines that such compliance is not
desired with respect to any Award or Awards available for grant under
the Plan, then compliance with Code Section 162(m)
<PAGE>
will not be required. In addition, in the event changes are made to Code
Section 162(m) to permit greater flexibility with respect to any Award or
Awards available under the Plan, the Committee may, subject to this
Article 15, make any adjustments it deems appropriate.
Article 16. Withholding
16.1 Tax Withholding. The Company shall have the power and the right
to deduct or withhold, or require a Participant to remit to the
Company, an amount sufficient to satisfy Federal, state, and local
taxes (including the Participant's FICA obligation) required by law to
be withheld with respect to any taxable event arising or as a result of
any Award to a Participant under this Plan.
16.2 Share Withholding. With respect to withholding required upon the
exercise of Options, upon the lapse of restrictions on Restricted
Stock, or upon any other taxable event arising as a result of Awards
granted hereunder, Participants may elect, subject to the approval of
the Committee, to satisfy the withholding requirement, in whole or in
part, by having the Company withhold Shares having a Fair Market Value
on the date the tax is to be determined equal to the minimum statutory
total tax which could be imposed on the transaction. The Committee may
establish such procedures as it deems appropriate for the settling of
withholding obligations with Shares, including, without limitation, the
establishment of such procedures as may be necessary to comply with the
requirements of Rule 16b-3, unless otherwise determined by the
Committee.
Article 17. Indemnification
Each person who is or shall have been a member of the Committee, or
of the Board, shall be indemnified and held harmless by the Company
against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him or her in connection with or
resulting from any claim, action, suit, or proceeding to which he or
she may be a party or in which he or she may be involved by reason of
any action taken or failure to act under the Plan and against and from
any and all amounts paid by him or her in settlement thereof, with the
Company's approval, or paid by him or her in satisfaction of any
judgment in any such action, suit, or proceeding against him or her,
provided he or she shall give the Company an opportunity, at its own
expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the
Company's Articles of Incorporation or Bylaws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or
hold them harmless.
Article 18. Successors
All obligations of the Company under the Plan, with respect to Awards
granted hereunder, shall be binding on any successor to the Company,
whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or
substantially all of the business and/or assets of the Company.
Article 19. Restrictions on Share Transferability
In addition to any restrictions imposed pursuant to the Plan, all
certificates for Shares delivered under the Plan pursuant to any Award
or the exercise thereof shall be subject to such stop transfer orders
and other restrictions as the Committee may deem advisable under the
Plan or the rules, regulations, and other requirements of the
Securities and Exchange Commission, any stock exchange or market upon
which such Shares are then listed or traded, any applicable Federal or
state securities laws, and the Committee may cause a legend or legends
to be put on any such certificates to make appropriate reference to
such restrictions.
<PAGE>
Article 20. Legal Construction
20.1 Gender and Number. Except where otherwise indicated by the
context, any masculine term used herein also shall include the
feminine; the plural shall include the singular and the singular shall
include the plural.
20.2 Severability. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity
shall not affect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had not
been included.
20.3 Requirements of Law. The granting of Awards and the issuance of
Shares under the Plan shall be subject to all applicable laws, rules,
and regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required.
20.4 Securities Law Compliance. With respect to Insiders,
transactions under this Plan are intended to comply with all applicable
conditions or Rule 16b-3 or its successors under the 1934 Act. To the
extent any provision of the Plan or action by the Committee fails to so
comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee.
20.5 Governing Law. To the extent not preempted by Federal law, the
Plan, and all agreements hereunder, shall be construed in accordance
with and governed by the laws of the State of Texas.
<PAGE>
TNP ENTERPRISES, INC. NONEMPLOYEE DIRECTOR STOCK PLAN
Article 1. Establishment, Purpose, and Duration
1.1 Establishment of the Plan. TNP Enterprises, Inc. hereby
establishes a stock plan to be known as the "TNP Enterprises, Inc.
Nonemployee Director Stock Plan" (the "Plan"), as set forth in this
document. The Plan permits the grant of unrestricted Shares of common
stock to Nonemployee Directors, subject to the terms and provisions set
forth herein.
Upon approval by the Board of Directors of the Company, subject to
ratification by an affirmative vote of a majority of the Shares of the
Company's common stock, the Plan shall become effective as of January
1, 1995 (the "Effective Date") and shall remain in effect as provided
in Section 1.3 herein. Each amendment to the Plan shall become
effective as of the date set forth in such amendment.
1.2 Purpose of the Plan. The purpose of the Plan is to build a
proprietary interest among the Company's Nonemployee Directors and
thereby secure for the Company's shareholders the benefits associated
with stock ownership by those who will oversee the Company's future
growth and success. The Plan also will provide the Company with a means
to attract Nonemployee Directors of outstanding competence.
1.3 Duration of the Plan. The Plan shall commence on the Effective
Date and shall remain in effect, subject to the right of the Board of
Directors to terminate the Plan at any time pursuant to Article 7
herein, until all Shares subject to it have been granted according to
the Plan's provisions. However, in no event may any Award be granted
under the Plan on or after January 1, 2005.
Article 2. Definitions
Whenever used in the Plan, the following terms shall have the
meanings set forth below and, when the meaning is intended, the initial
letter of the word is capitalized:
(a) "Award" means, individually or collectively, a grant under
this Plan of Shares of the Company.
(b) "Board" or "Board of Directors" means the Board of Directors
of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the Personnel, Organization, and Nominating
Committee of the Board of Directors of the Company or any
successor Committee thereto.
(e) "Company" means TNP Enterprises, Inc., a Texas Corporation,
its Subsidiaries, affiliates, or any successor thereto as provided
in Section 8.5 herein.
(f) "Director" means any member of the Board of Directors of the
Company who is not an Employee and any person holding, from time
to time, a position of advisory director as that term is defined
in the Company's bylaws.
(g) "Employee" means any full-time, nonunion, salaried employee
of the Company. For purposes of the Plan, an individual whose only
employment relationship with the Company is as a Director, shall
not be deemed an Employee.
(h) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor Act thereto.
(i) "Nonemployee Director" means any individual who is a member
of the Board of Directors of the Company, but who is not otherwise
an Employee of the Company.
(j) "Participant" means a Nonemployee Director who has been
granted an Award under the Plan.
(k) "Shares" means the shares of common stock of the Company.
<PAGE>
(l) "Subsidiary" means any corporation in which the Company owns
directly, or indirectly through subsidiaries, at least fifty
percent (50%) of the total combined voting power of all classes of
stock, or any other entity (including, but not limited to,
partnerships and joint ventures) in which the Company owns at
least fifty percent (50%) of the combined equity thereof.
Article 3. Administration of the Plan
3.1 The Committee. The Plan will be administered by the Committee.
3.2 Administration by the Committee. The Committee will have the
full power, discretion, and authority to interpret and administer the
Plan in a manner which is consistent with the Plan's provisions.
However, in no event will the Committee have the discretion to
determine Plan eligibility, or to determine the number, value, or
timing of Awards granted under the Plan. All such determinations will
be automatic pursuant to the provisions of the Plan.
The Plan may be amended to increase the number of Shares available
under the Plan; provided, however, that no such amendment will be made
more than once within any six- (6-) month period, and provided that no
such amendment will be made without the approval of the shareholders of
the Company's common stock to the extent such approval is required
under Article 7 herein.
3.3 Decisions Binding. All determinations and decisions made by
the Committee pursuant to provisions of the Plan, and all related
orders or resolutions of the Committee shall be final, conclusive, and
binding on all persons, including the Company, its shareholders,
employees, Participants, and their estates and beneficiaries.
Article 4. Shares Subject to the Plan
4.1 Number of Shares. Subject to adjustment as provided in Section
4.2 herein, the total number of Shares available for grant under the
Plan will not exceed thirty thousand (30,000) Shares.
4.2 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation,
liquidation, stock dividend, split-up, Share combination, or any other
change in the corporate structure of the Company affecting the Shares,
the Committee may make such adjustments to outstanding Awards as may be
determined to be appropriate and equitable by the Committee, in its
sole discretion, to prevent dilution or enlargement of rights;
provided, however, that no such adjustment will be made if the
adjustment would cause the Plan to fail to comply with the "formula
award" exception for grants of Awards to Nonemployee Directors pursuant
to Section 16 of the Exchange Act.
The Committee also will provide for such adjustments in the number
of Shares authorized pursuant to Section 4.1 of the Plan as the
Committee in its sole discretion may determine is appropriate to
reflect any transaction or event described in the preceding paragraph
of this Section 4.2.
Article 5. Eligibility and Participation
5.1 Eligibility. Persons eligible to participate in the Plan are
limited to Nonemployee Directors who are serving on the Board on the
date of each scheduled grant under the Plan.
5.2 Actual Participation. All eligible Nonemployee Directors
shall receive grants of Shares pursuant to Article 6 herein.
Article 6. Stock Awards
6.1 Annual Grants of Shares. An automatic award of five hundred
twenty-five (525) shares of stock will be made as of the annual
election of the Nonemployee Directors at the annual meeting of the
shareholders. The Shares awarded pursuant to this Section 6.1 will not
be subject to any restriction under the Plan (other than those
permitted or required pursuant to Section 6.2 herein).
6.2 Restrictions on Shares. The Company may impose restrictions
on any Shares granted pursuant to the Plan as it may deem advisable
including, without limitation, restrictions intended to achieve
compliance with the Securities Act of 1933, as amended, with the
requirements of any stock exchange upon which such
<PAGE>
Shares or Shares of the same class are then listed, and with any blue
sky or securities laws applicable to such Shares.
Article 7. Amendment, Modification, and Termination of the Plan
Subject to the terms set forth in this Section 7.1, the Board may
terminate, amend, modify, or supplement the Plan at any time and from
time to time; provided, however, that the Plan shall not be amended
more than once every six (6) months, other than to comport with changes
in the Code, the Employee Retirement Income Security Act of 1974, as
amended, or any rules promulgated thereunder.
Requisite approval of shareholders of the Company's voting stock will
be required for any amendment to the Plan to the extent such approval
is necessary to ensure continued compliance of the Plan with the
provisions of Rule 16b-3 (or any successor rule) of the rules and
regulations promulgated under the Exchange Act, with the provisions of
the Code, or with the provisions of any national securities exchange or
system on which the Shares are then listed or reported, or by any
regulatory body having jurisdiction with respect thereto.
Article 8. Miscellaneous
8.1 Gender and Number. Except as where may otherwise be indicated
by the context, any masculine term used herein shall include the
feminine; the plural shall include the singular and the singular shall
include the plural.
8.2 Severability. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity
shall not affect the remaining provisions of the Plan, and the Plan
shall be construed and enforced as if the illegal or invalid provision
had not been included.
8.3 Beneficiary Designation. Each Participant under the Plan may,
from time to time, name any beneficiary or beneficiaries (who may be
named contingently or successively) to whom any benefit under the Plan
is to be paid in the event of his or her death. Each designation will
revoke all prior designations by the same Participant, shall be in a
form prescribed by the Board, and will be effective only when filed by
the Participant in writing with the Board during his or her lifetime.
In the absence of any such designation, benefits remaining unpaid at
the Participant's death shall be paid to the Participant's estate.
8.4 No Right of Nomination. Nothing in the Plan shall be deemed to
create any right on the part of the Participant to continued membership
on the Board of Directors of the Company nor shall any provisions of
this Plan be construed to create any obligation on the part of the
Board to nominate any Director for reelection by the Company's
shareholders.
8.5 Successors. All obligations of the Company under the Plan
shall be binding on any successor to the Company.
8.6 Requirements of Law. The granting of Awards under the Plan
shall be subject to all applicable laws, rules, and regulations, and to
such approvals by any governmental agencies or national securities
exchanges as may be required.
8.7 Securities Law Compliance. With respect to any Nonemployee
Directors subject to Section 16 of the Exchange Act, transactions under
the Plan are intended to comply with all applicable conditions of Rule
16b-3 or its successors under the Exchange Act. To the extent any
provision of the Plan or action by the Board fails to so comply, it
shall be deemed null and void to the extent permitted by law and deemed
advisable by the Board.
8.8 Governing Law. To the extent not preempted by any United
States Federal law, the Plan shall be construed in accordance with the
laws of the state of Texas.
<PAGE>
MICHAEL D. BLANCHARD
ATTORNEY AT LAW
4100 International Plaza
P.O. Box 2943
Fort Worth, Texas 76113
(817) 731-0099
April 27, 1995
TNP Enterprises, Inc.
4100 International Plaza, Tower II
Fort Worth, Texas 76109
Re: Registration Statement on Form S-8 for TNP Enterprises,
Inc. Equity Incentive Plan and TNP Enterprises, Inc.
Nonemployee Director Stock Plan
Ladies and Gentlemen:
Pursuant to your request, I have examined copies of the TNP
Enterprises, Inc. Equity Incentive Plan and the TNP Enterprises, Inc.
Nonemployee Director Stock Plan (collectively referred to as the
"Plans") adopted by TNP Enterprises, Inc. ("TNPE"). I have also
examined TNPE's amended articles of incorporation, amended bylaws,
and minutes of corporate proceedings contained in TNPE's minute
books.
Based upon my examination of the foregoing papers and documents,
together with my examination of such other papers and documents and
investigation of such matters of law as I have deemed relevant or
necessary in rendering this opinion, I am of the opinion that shares
of TNPE's common stock awarded under the Plans will be, upon issuance
by TNPE in accordance with the terms of the Plans and the respective
agreements, if any, under which such stock is awarded, duly and
validly issued, fully paid, and nonassessable.
I consent to the use of this opinion in connection with TNPE's
registration statement on Form S-8 filed with the Securities and
Exchange Commission to register under the Securities Act of 1933, as
amended, 330,000 shares of TNPE's common stock.
Sincerely yours,
\s\ Michael D. Blanchard
Michael D. Blanchard, Esq.
<PAGE>
TNP ENTERPRISES, INC. AND SUBSIDIARIES Exhibit 23
Independent Auditors' Consent
The Board of Directors
TNP Enterprises, Inc.:
We consent to incorporation by reference in the registration statement
on Form S-8 of TNP Enterprises, Inc. of our report dated January 27,
1995, relating to the consolidated balance sheets and statements of
capitalization of TNP Enterprises, Inc. and subsidiaries as of
December 31, 1994 and 1993, and the related consolidated statements of
operations, common stockholders' equity and redeemable cumulative
preferred stock, and cash flows for each of the years in the three-
year period ended December 31, 1994, which report appears in the
December 31, 1994, annual report on Form 10-K of TNP Enterprises, Inc.
and to the reference to our firm under the heading "Experts" in the
prospectus.
Our report includes an explanatory paragraph that states that
uncertainties exist with respect to the regulatory treatment of the
income tax benefits of the regulatory disallowances recognized in
1994, as discussed in note 8 to the consolidated financial statements.
The ultimate outcome of this matter cannot presently be determined.
Accordingly, no provision for any loss that may ultimately be required
upon resolution of this matter has been made in the consolidated
financial statements.
As discussed in note 1 to the consolidated financial statements, the
Company changed its method of accounting for income taxes in 1993 to
adopt the provisions of the Financial Accounting Standards Board's
Statement of Financial Accounting Standards ("SFAS") No. 109,
Accounting for Income Taxes. As discussed in note 6, the Company also
adopted the provisions of the Financial Accounting Standards Board's
SFAS No. 106, Employers' Accounting for Postretirement Benefits Other
Than Pensions in 1993.
KPMG Peat Marwick LLP
Fort Worth, Texas
April 27, 1995
<PAGE>
