SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
January 18, 1994
ENSERCH Corporation
(Exact name of Registrant as specified in its charter)
Texas 1-3183 75-0399066
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
ENSERCH Center, 300 S. St. Paul, Dallas, Texas 75201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including Area Code: 214-651-8700
ITEM 5. Other Events
Set forth below in its entirety is a news release issued by
ENSERCH Corporation on January 18, 1994.
ENSERCH PLANS DEBT OFFERING
DALLAS, TEXAS (January 18, 1994) -- As part of this
year's financing program, ENSERCH Corporation plans to
sell $150 million of 10-year Notes pursuant to its
currently effective shelf registration. The Corporation
intends to use the proceeds from this sale for the early
redemption of all of the following outstanding sinking
fund debentures: 7 1/2% due 1996, 7.65% due 1998, 8.95%
due 1999, 8 3/4% due 2001 and 8 1/2% due 2002. ENSERCH
also intends to use a portion of the proceeds to call for
redemption all shares of its outstanding Adjustable Rate
Preferred Stock, Series D, at $50 per share. Early
redemptions are subject to the approval of the ENSERCH
Board of Directors at a meeting schedule for February 8.
If approved, call notices will be made shortly
thereafter, with the redemptions to begin in March 1994.
ITEM 7. Financial Statements and Exhibits
Exhibit 1 Revised form of Underwriting Agreement to be used in
connection with securities issued pursuant to
Registration Statement No. 33-45688.
SIGNATURE
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 hereunto duly authorized.
ENSERCH Corporation
Date: January 21, 1994 By: /s/ Jerry W. Pinkerton
Jerry W. Pinkerton,
Vice President and Controller,
Chief Accounting Officer
EXHIBIT 1
Draft of 1/18/94
ENSERCH CORPORATION
DEBT SECURITIES
UNDERWRITING AGREEMENT
January , 1994
[Name and Address
of Underwriters]
Gentlemen:
ENSERCH Corporation, a Texas corporation ("Company"), confirms
its agreement with the several Underwriters listed in Schedule A
hereto ("Underwriters", which term may refer to a single
Underwriter if only one is listed in Schedule A) as follows:
1. Description of Securities. The Company proposes to
issue and sell to the several Underwriters securities of the title,
amount and particular terms set forth or referred to in Schedule B
hereto ("Securities"). The Securities are to be issued under the
Indenture ("Indenture") identified in Schedule B hereto.
2. Representations and Warranties of the Company. The
Company represents and warrants to, and agrees with, each
Underwriter that:
(a) A registration statement on Form S-3 (with the file
number set forth in Schedule B hereto) with respect to the
Securities, including a prospectus, has been carefully
prepared by the Company in conformity with the requirements of
the Securities Act of 1933, as amended ("Act"), the Trust
Indenture Act of 1939, as amended ("Trust Indenture Act") and
the rules and regulations ("Rules and Regulations") of the
Securities and Exchange Commission ("Commission") thereunder
and filed with the Commission and has become effective. Such
registration statement and prospectus may have been amended or
supplemented prior to the date of this Agreement; any such
amendment or supplement was so prepared and filed, and any
such amendment filed after the effective date of such
registration statement has become effective. No stop order
suspending the effectiveness of the registration statement has
been issued, and no proceeding for that purpose has been
instituted or threatened by the Commission. A prospectus
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supplement ("Prospectus Supplement") setting forth the terms
of the Securities and of their sale and distribution has been
or will be so prepared and will be filed pursuant to Rule
424(b) of the Rules and Regulations on or before the second
business day after the date hereof (or such earlier time as
may be required by the Rules and Regulations). Copies of such
registration statement and prospectus, any such amendment or
supplement and all documents incorporated by reference therein
that were filed with the Commission on or prior to the date of
this Agreement (including one fully executed copy of the
registration statement and of each amendment thereto for each
of you and for counsel for the Underwriters) have been
delivered to you. Such registration statement, as it may have
heretofore been amended, is referred to herein as the
"Registration Statement", and the final form of prospectus
included in the Registration Statement, as supplemented by the
Prospectus Supplement, is referred to herein as the
"Prospectus". Each form of Prospectus, or Prospectus and
Prospectus Supplement, if any, heretofore made available for
use in offering the Securities is referred to herein as a
"Preliminary Prospectus". Any reference herein to the
Registration Statement, the Prospectus, any amendment or
supplement thereto or any Preliminary Prospectus shall be
deemed to refer to and include the documents incorporated by
reference therein, and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the
Registration Statement or Prospectus shall be deemed to refer
to and include the filing after the execution hereof of any
document with the Commission deemed to be incorporated by
reference therein.
(b) Each part of the registration statement, when such
part became or becomes effective, each Preliminary Prospectus
(if any) on the date of filing thereof with the Commission,
and the Prospectus and any amendment or supplement thereto, on
the date of filing thereof with the Commission and at the
Closing Date (as hereinafter defined), conformed or will
conform in all material respects with the requirements of the
Act, the Trust Indenture Act and the Rules and Regulations;
each part of the registration statement, when such part became
or becomes effective, did not or will not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading; each Preliminary Prospectus
(if any), on the date of filing thereof with the Commission,
and the Prospectus and any amendment or supplement thereto, on
the date of filing thereof with the Commission and at the
Closing Date, did not or will not include an untrue statement
of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and
the statements made in such documents in response to Rule 4-10
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of Regulation S-X and the statements made in such documents
within the coverage of Rule 175(b) of the General Rules and
Regulations under the Act were made by the Company with a
reasonable basis and in good faith; except that the foregoing
shall not apply to statements in or omissions from any such
document in reliance upon, and in conformity with, written
information furnished to the Company by you, or by any
Underwriter through you, specifically for use in the
preparation thereof.
(c) The documents incorporated by reference in the
Registration Statement, the Prospectus, any amendment or
supplement thereto or any Preliminary Prospectus, when they
became or become effective under the Act or were or are filed
with the Commission under the Securities Exchange Act of 1934,
as amended ("Exchange Act"), as the case may be, conformed or
will conform in all material respects with the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder.
(d) The financial statements of the Company and its
subsidiaries set forth in the Registration Statement and
Prospectus fairly present the financial condition of the
Company and its subsidiaries as of the dates indicated and the
results of operations and cash flows for the periods therein
specified in conformity with generally accepted accounting
principles consistently applied throughout the periods
involved (except as otherwise stated therein).
(e) The Company and each United States subsidiary and
each material non-United States subsidiary of the Company has
been duly incorporated and is an existing corporation in good
standing under the laws of its jurisdiction of incorporation,
has full power and authority (corporate and other) to conduct
its business as described in the Registration Statement and
Prospectus and is duly qualified to do business in each
jurisdiction in which it owns or leases real property or in
which the conduct of its business requires such qualification
except where the failure to be so qualified, considering all
such cases in the aggregate, does not involve a material risk
to the business, properties, financial position or results of
operations of the Company and its subsidiaries; and all of the
outstanding shares of capital stock of each such subsidiary
have been duly authorized and validly issued, are fully paid
and non-assessable and (except as otherwise stated in the
Registration Statement) are owned beneficially by the Company
subject to no security interest, other encumbrance or adverse
claim.
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(f) The Indenture and the Securities have been duly
authorized, the Indenture has been duly qualified under the
Trust Indenture Act and executed and delivered and
constitutes, and the Securities, when duly executed,
authenticated, issued and delivered as contemplated hereby and
by the Indenture, will constitute, valid and legally binding
obligations of the Company enforceable in accordance with
their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and
to general equity principles; as to any Securities which are
convertible into Common Stock, $4.45 par value ("Common
Stock") of the Company ("Convertible Securities"), such
Convertible Securities, when issued as contemplated hereby,
will be convertible into Common Stock in accordance with the
terms of the Indenture, the shares of Common Stock initially
issuable upon conversion of any convertible Securities will
have been duly authorized and reserved for issuance upon such
conversion, and, when so issued, will be validly issued, fully
paid and non-assessable; and the outstanding shares of Common
Stock of the Company have been duly authorized and validly
issued, are fully paid and non-assessable and conform to the
description thereof in the Prospectus, and the shareholders of
the Company have no preemptive rights with respect to such
Securities or the Common Stock.
(g) Except as contemplated in the Prospectus, subsequent
to the respective dates as of which information is given in
the Registration Statement and the Prospectus, neither the
Company nor any of its subsidiaries has incurred any
liabilities or obligations, direct or contingent, or entered
into any transactions, not in the ordinary course of business,
that are material to the Company and its subsidiaries, and
there has not been any material change, on a consolidated
basis, in the capital stock (other than from stock issued
under employee benefit and stock option plans), long-term debt
(other than from currency fluctuations and normal repurchases
of long-term debt for sinking fund purposes and scheduled
repayments) of the Company and its subsidiaries, or any
material adverse change, or any development involving a
prospective material adverse change, in the condition
(financial or other), business, prospects, net worth (other
than any decrease in net worth as a result of the declaration
by the Company of regular quarterly dividends on its preferred
stock and Common Stock) or results of operations of the
Company and its subsidiaries considered as a whole.
(h) Except as set forth in the Prospectus, there is not
pending or, to the knowledge of the Company, threatened any
action, suit or proceeding to which the Company or any of its
subsidiaries is a party, before or by any court or
governmental agency or body, other than litigation incident to
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the kind of business conducted by the Company, that might
result in any material adverse change in the condition
(financial or other), business, prospects, net worth or
results of operations of the Company and its subsidiaries
considered as a whole, or might materially and adversely
affect the properties or assets thereof.
(i) There are no contracts or documents of the Company or
any of its subsidiaries that are required to be filed as
exhibits to the Registration Statement or to any of the
documents incorporated by reference therein by the Act, the
Trust Indenture Act or the Exchange Act or by the rules and
regulations of the Commission thereunder that have not been so
filed.
(j) The performance of this Agreement and of any Delayed
Delivery Contracts (as hereinafter defined) and the
consummation of the transactions herein contemplated will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any
agreement or instrument to which the Company is a party or by
which it is bound or to which any of the property of the
Company is subject, the Articles of Incorporation, as amended,
or By-laws of the Company, or any order, rule or regulation of
any court or governmental agency or body having jurisdiction
over the Company or any of its properties; no consent,
approval, authorization or order of, or filing with, any court
or governmental agency or body is required for the
consummation of the transactions contemplated by this
Agreement in connection with the issuance or sale of the
Securities by the Company, except such as may be required
under the Act, the Trust Indenture Act or state securities
laws; and the Company has full power and authority to
authorize, issue and sell the Securities as contemplated by
this Agreement.
(k) The Company and its subsidiaries have good and
marketable title in fee simple to all real property and good
and marketable title to all personal property described in the
Registration Statement and Prospectus as being owned by them,
in each case free and clear of all liens, encumbrances and
defects except such as are described in the Registration
Statement and Prospectus or such as do not materially affect
the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company
and its subsidiaries; the real properties referred to in the
Registration Statement and Prospectus as held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the conduct of the
business of the Company and its subsidiaries; the pipeline
easements enjoyed by the Company and its subsidiaries are
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valid, subsisting and enforceable easements with such
exceptions as are not material and do not interfere with the
conduct of the business of the Company and its subsidiaries;
the gas purchase contracts referred to in the Registration
Statement and the Prospectus are valid contracts in accordance
with their terms; the leases, operating agreements and other
interests in gas acreage referred to in the Registration
Statement and Prospectus as held by the Company and its
subsidiaries entitle them to the rights therein purported to
be granted, subject to the jurisdiction of regulatory agencies
to establish allowable levels of production; the Company and
its subsidiaries possess all licenses, franchises, permits,
authorizations, approvals, consents and orders of all
governmental authorities or agencies (including, without
limitation, all certificates of public convenience and
necessity issued by the Federal Energy Regulatory Commission)
necessary for the ownership or lease of the properties owned
or leased or proposed to be owned or leased by them and for
the operation of the business carried on or proposed to be
carried on by them as described in the Registration Statement
and Prospectus; all such licenses, franchises, permits,
orders, authorizations, approvals and consents are in full
force and effect and contain no unduly burdensome provisions
and, except as otherwise set forth in the Registration
Statement and Prospectus, there are no legal or governmental
proceedings pending or threatened that would result in a
material modification, suspension or revocation thereof.
3. Purchase, Sale and Delivery of Securities. On the
basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set
forth, the Company agrees to issue and sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase
from the Company, at the purchase price set forth in Schedule B
hereto, the amount of Securities set forth opposite the name of
such Underwriter in Schedule A hereto less the reduction for such
Underwriter's portion of any Contract Securities determined as
provided below.
If so authorized in Schedule B hereto, the Underwriters
may solicit offers from investors of the types set forth in the
Prospectus to purchase Securities from the Company pursuant to
delayed contracts ("Delayed Delivery Contracts"). Such contracts
shall be substantially in the form of Exhibit I hereto but with
such changes therein as the Company may approve. Securities to be
purchased pursuant to Delayed Delivery Contracts are herein called
"Contract Securities". When Delayed Delivery Contracts are
authorized in Schedule B, the Company will enter into a Delayed
Delivery Contract in each case where a sale of Contract Securities
arranged through you has been approved by the Company but, except
as the Company may otherwise agree, such Delayed Delivery Contracts
must be for at least the minimum amount of Contract Securities set
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forth in Schedule B hereto, and the aggregate amount of Contract
Securities may not exceed the amount set forth in such Schedule.
The Company will advise you not later than 10:00 A.M., New York
City time, on the third full business day preceding the Closing
Date (or at such later time as you may otherwise agree) of the
sales of Contract Securities that have been so approved. You and
the other Underwriters will not have any responsibility in respect
of the validity or performance of Delayed Delivery Contracts.
The amount of Securities to be purchased by each
Underwriter as set forth in Schedule A hereto shall be reduced by
an amount that shall bear the same proportion to the total amount
of Contract Securities as the amount of Securities set forth
opposite the name of such Underwriter bears to the total amount of
Securities set forth in Schedule A hereto, except to the extent
that you determine that such reduction shall be otherwise than in
such proportion and so advise the Company; provided, however, that
the total amount of Securities to be purchased by all Underwriters
shall be the total amount of Securities set forth in Schedule A
hereto less the aggregate amount of Contract Securities.
The Securities to be purchased by the Underwriters will
be delivered by the Company to you for the accounts of the several
Underwriters at the office specified in Schedule B hereto against
payment of the purchase price therefor by certified or official
bank check or checks in New York Clearing House (next day) funds
payable to the order of the Company at the office, on the date and
at the times specified in such Schedule B, or at such other time
not later than eight full business days thereafter as you and the
Company determine, such time being herein referred to as the
"Closing Date". Such Securities will be prepared in the
denominations requested and registered in the name of the
securities depository (or a nominee thereof) set forth in Schedule
B hereto and will be made available for checking at least one
business day prior to the Closing Date.
It is understood that you, acting individually and not in
a representative capacity, may (but shall not be obligated to) make
payment to the Company on behalf of any other Underwriter for
Securities to be purchased by such Underwriter. Any such payment
by you shall not relieve any such Underwriter of any of its
obligations hereunder.
The Company will pay to you, at the Closing Date, for the
account of each Underwriter any commission or other compensation
that is specified in Schedule B hereto. Such payment will be made
by certified or official bank check or checks in New York Clearing
House (next day) funds.
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4. Covenants. The Company covenants and agrees with
each Underwriter that:
(a) The Company will cause the Prospectus Supplement to
be filed as required by Section 2(a) hereof (but only if you
have not reasonably objected thereto by notice to the Company
after having been furnished a copy a reasonable time prior to
filing) and will notify you promptly of such filing. During
the period in which a prospectus relating to the Securities is
required to be delivered under the Act, the Company will
notify you promptly of the time when any subsequent amendment
to the Registration Statement has become effective or any
subsequent supplement to the Prospectus has been filed and of
any request by the Commission for any amendment or supplement
to the Registration Statement or Prospectus or for additional
information; it will prepare and file with the Commission,
promptly upon your request, any amendments or supplements to
the Registration Statement or Prospectus that, in your
opinion, may be necessary or advisable in connection with the
distribution of the Securities by the Underwriters; it will
file no amendment or supplement to the Registration Statement
or Prospectus (other than any prospectus supplement relating
to the offering of other securities registered under the
Registration Statement or any document required to be filed
under the Exchange Act that upon filing is deemed to be
incorporated by reference therein) to which you shall
reasonably object by notice to the Company after having been
furnished a copy a reasonable time prior to the filing; and it
will furnish to you at or prior to the filing thereof a copy
of any such prospectus supplement or any document that upon
filing is deemed to be incorporated by reference in the
Registration Statement or Prospectus.
(b) The Company will advise you, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance by
the Commission of any stop order suspending the effectiveness
of the Registration Statement, of the suspension of the
qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any
proceeding for any such purpose; and it will promptly use its
best efforts to prevent the issuance of any stop order or to
obtain its withdrawal if such a stop order should be issued.
(c) Within the time during which a prospectus relating to
the Securities is required to be delivered under the Act, the
Company will comply as far as it is able with all requirements
imposed upon it by the Act and by the Rules and Regulations,
as from time to time in force, so far as necessary to permit
the continuance of sales of or dealings in the Securities as
contemplated by the provisions hereof and the Prospectus. If
during such period any event occurs as a result of which the
Prospectus as then amended or supplemented would include an
8
untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the
light of the circumstances then existing, not misleading, or
if during such period it is necessary to amend or supplement
the Registration Statement or Prospectus to comply with the
Act, the Company will promptly notify you and will amend or
supplement the Registration Statement or Prospectus (at the
expense of the Company) so as to correct such statement or
omission or effect such compliance.
(d) The Company will use its best efforts to qualify the
Securities and any Common Stock into which any Securities are
convertible for sale under the securities laws of such
jurisdictions as you reasonably designate and to continue such
qualifications in effect so long as required for the
distribution of the Securities, except that the Company shall
not be required in connection therewith to qualify as a
foreign corporation or to execute a general consent to service
of process in any jurisdiction. The Company will also arrange
for the determination of the eligibility for investment of the
Securities under the laws of such jurisdictions as you
reasonably request.
(e) The Company will furnish to the Underwriters copies
of the Registration Statement, the Prospectus (including all
documents incorporated by reference therein) and all
amendments and supplements to the Registration Statement or
Prospectus that are filed with the Commission during the
period in which a prospectus relating to the Securities is
required to be delivered under the Act (including all
documents filed with the Commission during such period that
are deemed to be incorporated by reference therein), in each
case as soon as available and in such quantities as you may
from time to time reasonably request.
(f) The Company will make generally available to its
security holders as soon as practicable, but in any event not
later than 15 months after the end of the Company's current
fiscal quarter, an earnings statement (which need not be
audited) covering a 12-month period beginning after the date
upon which the Prospectus Supplement is filed pursuant to Rule
424 under the Act that shall satisfy the provisions of Section
11(a) of the Act or Rule 158 thereunder.
(g) The Company, whether or not the transactions
contemplated hereunder are consummated or this Agreement is
terminated, will pay all expenses incident to the performance
of its obligations hereunder, will pay the expenses of
printing all documents relating to the offering, and will
reimburse the Underwriters for any expenses (including fees
and disbursements of counsel) incurred by them in connection
with the matters referred to in Section 4(d) hereof and the
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preparation of memoranda relating thereto, for any filing fee
of the National Association of Securities Dealers, Inc.
relating to the Securities and for any fees charged by
investment rating agencies for rating the Securities. If the
sale of Securities to be purchased by the several Underwriters
as provided for herein is not consummated by reason of any
failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because
any other condition of the Underwriters' obligations hereunder
required to be fulfilled by the Company is not fulfilled, the
Company will reimburse the several Underwriters for all
reasonable out-of-pocket disbursements (including fees and
disbursements of counsel) incurred by the Underwriters in
connection with their investigation, preparing to market and
marketing the Securities or in contemplation of performing
their obligations hereunder. The Company shall not in any
event be liable to any of the Underwriters for loss of
anticipated profits from the transactions covered by this
Agreement.
(h) The Company will apply the net proceeds from the sale
of the Securities as set forth in the Prospectus.
(i) The Company will not, directly or indirectly, offer
or sell, or determine to offer or sell, any debt securities
that are substantially similar to the Securities (except under
prior contractual commitments) during the period ending on the
earlier of the Closing Date or 10 business days after the date
of this Agreement without your prior written consent.
5. Conditions of Underwriters' Obligations. The
obligations of the several Underwriters to purchase and pay for
Securities as provided herein shall be subject to the accuracy, as
of the date hereof and the Closing Date (as if made at the Closing
Date), of the representations and warranties of the Company herein,
to the performance by the Company of its obligations hereunder and
to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to
the knowledge of the Company or any Underwriter, threatened by
the Commission, and any request of the Commission for
additional information (to be included in the Registration
Statement or the Prospectus or otherwise) shall have been
complied with to your satisfaction.
(b) No Underwriter shall have advised the Company that
the Registration Statement or Prospectus, or any amendment or
supplement thereto, contains an untrue statement of fact that
in your opinion is material, or omits to state a fact that in
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your opinion is material and is required to be stated therein
or is necessary to make the statements therein not misleading.
(c) Except as contemplated in the Prospectus, subsequent
to the respective dates as of which information is given in
the Registration Statement and the Prospectus, there shall not
have been any change, on a consolidated basis, in the capital
stock (other than from stock issued under employee benefit and
stock option plans), long-term debt (other than from currency
fluctuations and normal repurchases of long-term debt for
sinking fund purposes and scheduled repayments) of the Company
and its subsidiaries, or any adverse change, or any
development involving a prospective adverse change, in the
condition (financial or other), business, prospects, net worth
(other than any decrease in net worth as a result of the
declaration by the Company of regular quarterly dividends on
its preferred stock and Common Stock) or results of operations
of the Company and its subsidiaries, or any change in the
rating assigned to any securities of the Company, that, in
your judgment, makes it impractical or inadvisable to offer or
deliver the Securities on the terms and in the manner
contemplated in the Prospectus.
(d) You shall have received the opinion of William T.
Satterwhite, Esq., counsel for the Company, dated the Closing
Date, to the effect that:
(i) Each of the Company, its United States
subsidiaries and all material non-United states
subsidiaries have been duly incorporated and is an
existing corporation in good standing under the laws of
its jurisdiction of incorporation, has full power and
authority (corporate and other) to conduct its business
as described in the Registration Statement and
Prospectus; the Company is duly qualified to do business
in each jurisdiction in which it owns or leases real
property or in which the conduct of its business requires
such qualification except where the failure to be so
qualified, considering all such cases in the aggregate,
does not involve a material risk to the business,
properties, financial position or results of operations
of the Company and its subsidiaries; each of the
subsidiaries of the Company is duly qualified to do
business as a foreign corporation and is in good standing
under the laws of each jurisdiction in the United States
which requires such qualification wherein it owns or
leases material properties or conducts material business;
and all of the outstanding shares of capital stock of
each of the Company's subsidiaries have been duly
authorized and validly issued, are fully paid and non-
assessable and (except as otherwise stated in the
Registration Statement) are owned beneficially by the
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Company subject to no security interest, other
encumbrance or adverse claim;
(ii) The Indenture and the Securities have been
duly authorized, the Indenture has been duly qualified
under the Trust Indenture Act, executed and delivered,
the Securities purchased by the Underwriters have been
duly executed, authenticated, issued and delivered, and
the Indenture and such Securities constitute, and any
Contract Securities, when executed, authenticated, issued
and delivered in the manner provided in the Indenture and
the Delayed Delivery Contracts, will constitute, valid
and legally binding obligations of the Company,
enforceable in accordance with their terms, subject, as
to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or
affecting creditors' rights and to general equity
principles; and as to any Convertible Securities
purchased by the Underwriters or any Contract Securities
which are convertible into Common Stock ("Convertible
Contract Securities"), such Convertible Securities are,
and such Convertible Contract Securities, when executed,
authenticated, issued and delivered in the manner
provided in the Indenture and the Delayed Delivery
Contracts will be, convertible into Common Stock of the
Company in accordance with the terms of the Indenture,
the shares of Common Stock initially issuable upon
conversion of any Convertible Securities have been duly
authorized and reserved for issuance upon such
conversion, and, when so issued, will be validly issued,
fully paid and non-assessable; and the outstanding shares
of Common Stock of the Company have been duly authorized
and validly issued, are fully paid and non-assessable and
conform to the description thereof in the Prospectus, and
the shareholders of the Company have no preemptive rights
with respect to the Securities or the Common Stock;
(iii) The Registration Statement has become
effective under the Act; the Prospectus Supplement has
been filed as required by Section 2(a) hereof; and to the
best knowledge of such counsel no stop order suspending
the effectiveness of the Registration Statement has been
issued and no proceeding for that purpose has been
instituted or threatened by the Commission;
(iv) Each part of the registration statement, when
such part became effective, and the Prospectus and any
amendment or supplement thereto, on the date of filing
thereof with the Commission and at the Closing Date,
complied as to form in all material respects with the
requirements of the Act, the Trust Indenture Act and the
Rules and Regulations; such counsel have no reason to
12
believe that either any part of the registration
statement, when such part became effective, contained an
untrue statement of a material fact or omitted to state
a material fact required to be stated therein or
necessary to make the statements therein not misleading
or that the Prospectus and any amendment or supplement
thereto, on the date of filing thereof with the
Commission or at the Closing Date, included an untrue
statement of a material fact or omitted to state a
material fact necessary to make the statements therein,
in the light of the circumstances under which they were
made, not misleading; and the documents incorporated by
reference in the Registration Statement or Prospectus or
any amendment or supplement thereto, when they became
effective under the Act or were filed with the Commission
under the Exchange Act, as the case may be, complied as
to form in all material respects with the requirements of
the Act or the Exchange Act, as applicable, and the rules
and regulations of the Commission thereunder; it being
understood that such counsel need express no opinion as
to the financial statements or other financial data and
the description of the reports of DeGolyer and
MacNaughton, included in any of the documents mentioned
in this clause;
(v) The description in the Registration Statement
and Prospectus of statutes, legal and governmental
proceedings, contracts and other documents are accurate
and fairly present the information required to be shown;
the pipeline easements enjoyed by the Company and its
subsidiaries are valid, subsisting and enforceable
easements with such exceptions as are not material and do
not interfere with the conduct of the business of the
Company and its subsidiaries; the gas purchase contracts
referred to in the Registration Statement and the
Prospectus are valid contracts in accordance with their
terms; the leases, operating agreements and other
interests in gas acreage referred to in the Registration
Statement and Prospectus as held by the Company and its
subsidiaries entitle them to the rights therein purported
to be granted, subject to the jurisdiction of regulatory
agencies to establish allowable levels of production; the
Company and its subsidiaries possess all licenses,
franchises, permits, authorizations, approvals, consents
and orders of all governmental authorities or agencies
(including, without limitation, all certificates of
public" convenience and necessity issued by the Federal
Energy Regulatory Commission) necessary for the ownership
or lease of the properties owned or leased or proposed to
be owned or leased by them and for the operation of the
business carried on or proposed to be carried on by them
as described in the Registration Statement and
13
Prospectus; all such licenses, franchises, permits,
orders, authorizations, approvals and consents are in
full force and effect and contain no unduly burdensome
provisions and, except as otherwise set forth in the
Registration Statement and Prospectus, there are no legal
or governmental proceedings pending or threatened that
would result in a material modification, suspension or
revocation thereof; and such counsel do not know of any
statutes or legal or governmental proceedings required to
be described in the Prospectus that are not described as
required, or of any contracts or documents of a character
required to be described in the Registration Statement or
Prospectus (or required to be filed under the Exchange
Act if upon such filing they would be incorporated by
reference therein) or to be filed as exhibits to the
Registration Statement that are not described and filed
as required;
(vi) This Agreement and any Delayed Delivery
Contracts have been duly authorized, executed and
delivered by the Company; the performance of this
Agreement and of any Delayed Delivery Contracts and the
consummation of the transactions herein contemplated will
not result in a breach or violation of any of the terms
and provisions of, or constitute a default under, any
statute, any agreement or instrument known to such
counsel to which the Company is a party or by which it is
bound or to which any of the property of the Company is
subject, the Articles of Incorporation, as amended, or
By-laws of the Company, or any order, rule or regulation
known to such counsel of any court or governmental agency
or body having jurisdiction over the Company or any of
its properties; and no consent, approval, authorization
or order of, or filing with, any court or governmental
agency or body is required for the consummation of the
transactions contemplated by this Agreement in connection
with the issuance or sale of the Securities by the
Company, except such as have been obtained under the Act
and the Trust Indenture Act and such as may be required
under state securities laws in connection with the
purchase and distribution of the Securities by the
Underwriters; and
(vii) The Company is not a "holding company" or a
"subsidiary company" of a "holding company" within the
meaning of the Public Utility Holding Company Act of
1935, as amended.
14
(e) You shall have received the opinion of Mudge Rose
Guthrie Alexander & Ferdon, counsel for the Underwriters,
dated the Closing Date, to the effect that:
(i) The Company has been duly incorporated and is
an existing corporation in good standing under the laws
of the State of Texas;
(ii) 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, executed, authenticated, issued and
delivered; and the Indenture and the Securities
constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other
laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(iii) The Indenture and the Securities conform in
all material respects to the descriptions thereof
contained in the Prospectus as amended and supplemented;
and
(iv) This Agreement has been duly authorized,
executed and delivered by the Company.
Such counsel shall also state in such opinion that
although they are not passing upon or assuming any
responsibility for the accuracy, completeness or fairness of
any of the statements made in the Registration Statement or
the Prospectus or any amendment or supplement thereto, on the
basis of the information which they gained in the course of
the services specified in such opinion, in their opinion, each
part of the Registration Statement when such part became
effective and the Prospectus, as amended or supplemented on
the date of this Agreement (other than certain incorporated
documents), appear on their face to comply as to form in all
material respects with the requirements of the Act, the Trust
Indenture Act and the Rules and Regulations. Such counsel
shall further state in such opinion that nothing which has
come to their attention in the course of such review has
caused them to believe that any part of the Registration
Statement, when such part became effective, contained an
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 that the
Prospectus, as amended or supplemented on the date of this
Agreement, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
15
under which they were made, not misleading. Such counsel
shall also state in such opinion that nothing which has come
to their attention has caused them to believe that the
Prospectus, as amended or supplemented as of the time of the
delivery of such opinion, contains an untrue statement of a
material fact or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading. Notwithstanding
the foregoing, such counsel may state in such opinion that
they are not expressing any opinion or belief as to the
financial statements or other financial or statistical data
contained in the Registration Statement, any incorporated
documents, the Prospectus and any amendment or supplement
thereto, or as to the estimates of reserves and other
information included in any thereof upon the authority of
DeGolyer & MacNaughton, or as to the statement of eligibility
of the Trustee on Form T-1.
In rendering their opinion, such counsel may rely upon
the opinion of William T. Satterwhite, Esq., referred to above
as to all matters governed by Texas law.
(f) You shall have received a letter from Deloitte &
Touche, dated the Closing Date, to the effect set forth in
Exhibit II hereto.
(g) You shall have received from the Company a
certificate, signed by the Chairman, the President or a Vice
President, and by the principal financial or accounting
officer, of the Company, dated the Closing Date, to the effect
that, to the best of their knowledge based upon reasonable
investigation:
(i) The representations and warranties of the
Company in this Agreement are true and correct, as if
made at and as of the Closing Date, and the Company has
complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or
prior to the Closing Date;
(ii) No stop order suspending the effectiveness of
the Registration Statement has been issued, and no
proceeding for that purpose has been instituted or is
threatened, by the Commission; and
(iii) Since the date of this Agreement, there has
occurred no event required to be set forth in an
amendment or supplement to the Registration Statement or
Prospectus that has not been so set forth and there has
been no document required to be filed under the Exchange
Act and the rules and regulations of the Commission
16
thereunder that upon such filing would be deemed to be
incorporated by reference in the Prospectus that has not
been so filed.
(h) The Company shall have furnished to you such further
certificates and documents as you shall have reasonably
requested.
All such opinions, certificates, letters and other documents will
be in compliance with the provisions hereof only if they are
satisfactory in form and substance to you. The Company will
furnish you with such conformed copies of such opinions,
certificates, letters and other documents as you shall reasonably
request.
6. Indemnification and Contribution. (a) The Company
will indemnify and hold harmless each Underwriter 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 an untrue
statement or alleged untrue statement of a material fact contained
in any part of the registration statement when such part became
effective, or in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto,
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 it in connection with investigating or
defending against such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company
shall 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 or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by you, or by any
Underwriter through you, specifically for use in the preparation
thereof.
(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 an untrue statement
or alleged untrue statement of a material fact contained in any
part of the registration statement when such part became effective,
or in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, 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, in each case to the extent,
17
but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made therein
in reliance upon and in conformity with written information
furnished to the Company by you, or by such Underwriter through
you, specifically for use in the preparation thereof, and will
reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or
defending against any such loss, claim, damage, liability or action
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof
is to be made against the indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability that it may have to any
indemnified party otherwise than under such subsection. In case
any such action shall be brought against any indemnified party, and
it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate in, and, to
the extent that it shall 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 shall not be liable to such
indemnified party under such subsection 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
6 is unavailable or insufficient to hold harmless an indemnified
party under subsection (a) or (b) above, then each indemnifying
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 that 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
proceeds from the offering of the Securities (before deducting
18
expenses) received by the Company bear to the total compensation or
profit (before deducting expenses) received or realized by the
Underwriters from the purchase and resale, or underwriting, of the
Securities. 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
prevent such untrue statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if
contributions pursuant to this subsection (d) were to be determined
by pro rata allocations (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation
that does not take account of the equitable considerations referred
to in the first sentence of this subsection (d). 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 against any action or claim that is the
subject of 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
that such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue 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 6
shall be in addition to any liability that 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 6 shall be in addition to any
liability that the respective Underwriters may otherwise have and
shall extend, upon the same terms and conditions, to each director
of the Company (including any person who, with his consent, is
named in the Registration Statement as about to become a 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.
19
7. Representations and Agreements to Survive Delivery.
All representations, warranties and agreements of the Company
herein or in certificates delivered pursuant hereto, and the
agreements of the several Underwriters contained in Section 6
hereof, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any
Underwriter or any controlling persons, or the Company or any of
its officers, directors or any controlling persons, and shall
survive delivery of and payment for the Securities.
8. Substitution of Underwriters. (a) If any Underwriter
or Underwriters shall fail to take up and pay for the amount of
Securities agreed by such Underwriter or Underwriters to be
purchased hereunder, upon tender of such Securities in accordance
with the terms hereof, and the amount of Securities not purchased
does not aggregate more than 10% of the total amount of Securities
set forth in Schedule A hereto, the remaining Underwriters shall be
obligated to take up and pay for (in proportion to their respective
underwriting obligations hereunder as set forth in Schedule A
hereto except as may otherwise be determined by you) the Securities
that the withdrawing or defaulting Underwriter or Underwriters
agreed but failed to purchase.
(b) If any Underwriter or Underwriters shall fail to take
up and pay for the amount of Securities agreed by such Underwriter
or Underwriters to be purchased hereunder, upon tender of such
Securities in accordance with the terms hereof, and the amount of
Securities not purchased aggregates more than 10% of the total
amount of Securities set forth in Schedule A hereto, and
arrangements satisfactory to you and the Company for the purchase
of such Securities by other persons are not made within 36 hours
thereafter, this Agreement shall terminate. In the event of any
such termination the Company shall not be under any liability to
any Underwriter (except to the extent provided in Section 4(g) and
Section 6 hereof) nor shall any Underwriter (other than an
Underwriter who shall have failed, otherwise than for some reason
permitted under this Agreement, to purchase the amount of
Securities agreed by such Underwriter to be purchased hereunder) be
under any liability to the Company (except to the extent provided
in Section 6 hereof).
9. Termination. You shall have the right by giving
notice as hereinafter specified at any time at or prior to the
Closing Date, to terminate this Agreement if (i) the Company shall
have failed, refused or been unable, at or prior to the Closing
Date, to perform any agreement on its part to be performed
hereunder, (ii) any other condition of the Underwriters'
obligations hereunder is not fulfilled, (iii) trading on the New
York Stock Exchange or the American Stock Exchange shall have been
wholly suspended, (iv) minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall
have been required, on the New York Stock Exchange or the American
20
Stock Exchange, by such Exchange or by order of the Commission or
any other governmental authority having jurisdiction, (v) a banking
moratorium shall have been declared by Federal or New York
authorities, or (vi) an outbreak of major hostilities in which the
United States is involved, a declaration of war by Congress, any
other substantial national or international calamity or any other
event or occurrence of a similar character shall have occurred
since the execution of this Agreement that, in your judgment, makes
it impractical or inadvisable to proceed with the completion of the
sale of and payment for the Securities to be purchased by the
Underwriters. Any such termination shall be without liability of
any party to any other party except that the provisions of Section
4(g) and Section 6 hereof shall at all times be effective. If you
elect to terminate this Agreement as provided in this Section, the
Company shall be notified promptly by you by telephone or telecopy,
confirmed by letter.
10. Notices. All notices or communications hereunder
shall be in writing and if sent to you shall be mailed, delivered
or telecopied and confirmed to you at the address set forth for
that purpose in Schedule B hereto, or if sent to the Company, shall
be mailed, delivered or telecopied and confirmed to the Company c/o
the Treasurer, at ENSERCH Center, 300 South St. Paul Street,
Dallas, Texas 75201-5598. Notice to any Underwriter pursuant to
Section 6 hereof shall be mailed, delivered or telecopied and
confirmed to such Underwriter's address as it appears in such
Underwriter's questionnaire or other notice furnished to the
Company in writing for the purpose of communications hereunder.
Any party to this Agreement may change such address for notices by
sending to the parties to this Agreement written notice of a new
address for such purpose.
11. Parties. This Agreement shall inure to the benefit
of and be binding upon the Company and the Underwriters and their
respective successors and the controlling persons, officers and
directors referred to in Section 6 hereof, and no other person will
have any right or obligation hereunder.
In all dealings with the Company under this Agreement,
you shall act on behalf of each of the several Underwriters, and
any action under this Agreement taken by you or by any one of you
designated in Schedule B hereto will be binding upon all the
Underwriters.
12. Applicable Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New
York.
21
_______________
If the foregoing correctly sets forth the understanding
between the Company and the several Underwriters, please so
indicate in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the
Company and the several Underwriters. Alternatively, the execution
of this Agreement by the Company and its acceptance by or on behalf
of the Underwriters may be evidenced by an exchange of telecopy or
other written communications.
Very truly yours,
ENSERCH CORPORATION
By
Name:
Title:
ACCEPTED as of the date first
above written.
By
By
Name:
Title:
SCHEDULE A
Principal
Amount of
Notes to be
Underwriter Purchased
. . . . . . . . . . . . . . $
. . . . . . . . . . . . . .
. . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . $150,000,000
SCHEDULE B
Underwriting Agreement dated January [25], 1994
Indenture dated as of February 15, 1992, between the Company and
The First National Bank of Chicago, as Trustee
Registration Statement No. 33-45688
Title of Securities: % Notes Due 2004 (the "Notes").
Amount of Securities: $150,000,000 principal amount of
the Notes.
Denomination of Global
Security: $150,000,000.
Securities Depository: The Depository Trust Company.
Purchase Price: % of the principal amount, plus
accrued interest from February [1],
1994.
Delayed Delivery: Not Applicable.
Closing-
Office for delivery of
Securities: The Depository Trust Company
55 Water Street
New York, New York 10041-0099
Office for payment for
Securities: Mudge Rose Guthrie
Alexander & Ferdon
180 Maiden Lane
New York, New York 10038
Date and time of Closing: 9:30 a.m., February [1], 1994
Form of Securities: Book-entry, registered in the
name of The Depository Trust
Company or its nominee.
Underwriting Discount: %
Address for notices per
Section 10:
Name of Underwriter to act
per Section 11:
Particular terms of the
Securities-
Interest: % per annum, from February 1,
1994, payable semi-annually on
February 1 and August 1,
commencing August 1, 1994, to
holders of record on the
preceding January 15, or July
15, as the case may be.
Maturity: February 1, 2004.
Optional Redemption: None.
Sinking Fund: None.
Other terms: For the additional terms of the
Notes, reference is made to the
Prospectus dated March 4, 1992
as supplemented by the
Prospectus Supplement dated the
date hereof.
EXHIBIT I
ENSERCH CORPORATION
[Title of Securities]
DELAYED DELIVERY CONTRACT
_________________ __, 199_
ENSERCH Corporation
c/o _________________________________
[As Representative of the Several Underwriters,]
_____________________
_____________________
_____________________
Gentlemen:
The undersigned hereby agrees to purchase from ENSERCH
Corporation ("Company"), and the Company agrees to sell to the
undersigned, [If one delayed closing, insert -- as of the date hereof,
for delivery on , 199_ ("Delivery Date")] $
principal amount of the Company's ("Securities"),
offered by the Company's Prospectus relating thereto, receipt of a copy
of which is hereby acknowledged, at a purchase price of % of the
principal amount thereof plus accrued interest, if any, from
to the Delivery Date and on the further terms and conditions set forth
in this contract.
[If two or more delayed closings, insert the following:
The undersigned will purchase from the Company as of the date
hereof, for delivery on the dates set forth below, Securities in the
amounts set forth below:
Delivery Date Amount
_____________ __________
_____________ __________
Each of such delivery dates is hereinafter referred to as a Delivery
Date.]
Payment for the Securities that the undersigned has agreed to
purchase for delivery on a Delivery Date shall be made to the Company
or its order by certified or official bank check in New York Clearing
House (next day) funds at the office of __________________ at
A.M. on that Delivery Date upon delivery to the undersigned of the
Securities to be purchased by the undersigned for delivery on that
Delivery Date in definitive form and in such denominations 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 that Delivery Date. If no request is
received, the Securities will be registered in the name of the
undersigned and issued in a denomination equal to the total amount of
Securities to be purchased by the undersigned on that Delivery Date.
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 a Delivery Date shall be subject
only to the conditions that (1) investment in the Securities shall not
at that Delivery Date be prohibited under the laws of any jurisdiction
in the United States to which the undersigned is subject, which
investment the undersigned represents is not prohibited on the date
hereof, and (2) the Company shall have sold to the Underwriters the
amount of Securities to be sold to them pursuant to the Underwriting
Agreement referred to in the Prospectus mentioned above.
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 opinion
of counsel for the Company 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.
It is understood that the acceptance of this contract and any
other similar contracts 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 hereof to the undersigned at its
address set forth below. This will become a binding contract between
the Company and the undersigned when such counterpart is so mailed or
delivered.
This contract shall be governed by, and construed in
accordance with, the laws of the State of New York.
Very truly yours,
[Name of Purchaser]
By
Name:
Title:
(Address of Purchaser)
Accepted, as of the above date.
ENSERCH CORPORATION
By
Name:
Title:
EXHIBIT II
1. They are independent certified public accountants
with respect to the Company and its subsidiaries within the meaning
of the Act and the Rules and Regulations.
2. In their opinion, the financial statements and any
schedules audited by them and included or incorporated by reference
in the Registration Statement and Prospectus comply as to form in
all material respects with the applicable accounting requirements
of the Act and the Exchange Act, as applicable, and the published
rules and regulations of the Commission thereunder. They have
performed the procedures specified by the American Institute of
Certified Public Accountants for a review of interim financial
information as described in SAS 71, Interim Financial Information,
on the unaudited financial statements included in the Company's
Quarterly Reports on Form 10-Q incorporated by reference in the
Prospectus.
3. On the basis of procedures referred to in such
letter, including a reading of the minutes and the latest available
interim financial statements of the Company and inquiries of
officials of the Company responsible for financial and accounting
matters, nothing caused them to believe that:
(A) Any material modifications should be made to the
unaudited financial statements, if any, included or
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(B) the unaudited financial statements, if any, included
or incorporated by reference in the Prospectus do not comply
as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act and the
published rules and regulations of the Commission thereunder;
(C) the unaudited pro forma condensed consolidated
financial statements, if any, included or incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Act or the Exchange Act and the published rules and
regulations of the Commission thereunder or the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
(D) at the date of the latest available internal balance
sheet of the Company and at a subsequent specified date not
more than five days prior to the date of such letter, there
was any change in the capital stock (other than from stock
issued under employee benefit and stock option plans), or
long-term debt (other than from currency fluctuations and
normal repurchases of long-term debt for sinking fund purposes
and scheduled repayments) of the Company and its subsidiaries
consolidated or any decrease in consolidated net current
assets or net assets (excluding any decrease in net assets as
a result of the declaration by the Company of regular
quarterly dividends on its preferred stock and Common Stock)
as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus,
except in all cases for changes or decreases that the
Prospectus discloses have occurred or may occur or as may be
set forth in such letter; or
(E) for the period from the date of the latest income
statement included or incorporated by reference in the
Prospectus to the date of the latest available internal income
statement of the Company, there was any decrease, as compared
with the corresponding period of the previous year in
consolidated revenues or in the total or per share amounts of
income before extraordinary items or of net income, except in
all cases for changes or decreases that the Prospectus
discloses have occurred or may occur or as may be set forth in
such letter.
4. In addition to their audit referred to in their
reports included or incorporated by reference in the Registration
Statement and Prospectus and the procedures referred to in (3)
above, they have carried out certain other specified procedures,
not constituting an audit, with respect to certain specified dollar
amounts, percentages and other financial information (in each case
to the extent that such dollar amounts, percentages and other
financial information are derived, directly or by analysis or
computation, from the general accounting records of the Company and
its subsidiaries) that are included or incorporated by reference in
the Prospectus and appear in the Prospectus or incorporated
documents and have found such dollar amounts, percentages and
financial information to be in agreement with the general
accounting records of the Company and its subsidiaries.
January 18, 1994
$150,000,000
ENSERCH CORPORATION
% NOTES DUE 2004
Dear :
ENSERCH Corporation (the "Company") intends to sell $150,000,000
aggregate principal amount of ___% Notes Due 2004 (the "Notes") on
January 25, 1994 (the "Sale Date"). The Notes are described in the
enclosed Registration Statement and draft Prospectus Supplement.
The Company anticipates subject to the terms and provisions
described in this letter, signing an Underwriting Agreement in the
form attached with the firm or firms submitting the offer which
results in the lowest cost of funds to the Company as determined in
the sole discretion of the Company.
After an offer is selected, the offering and sale of the Notes will
proceed and be documented like a normal negotiated sale. It is
anticipated that the closing will be held on February 1, 1994, at
the office of Mudge Rose Guthrie Alexander & Ferdon, 180 Maiden
Lane, 34th Floor, New York, New York 10038. Mudge Rose has been
designated as counsel to the prospective Underwriters. Persons at
Mudge Rose working on the proposed offering are Arnold Tracy
(212/510-7400), Ted Farris (212/510-7792) and Chris Moore (212/510-
7568).
January 18, 1994
Page 2
Offers should be made by telephone to Messrs. Benjamin A. Brown and
R.L. Jay, or the Company's other authorized representatives between
10:00 a.m. and 10:10 a.m. Eastern Time on the Sale Date at the
following telephone numbers at Mudge Rose Guthrie Alexander &
Ferdon, 180 Maiden Lane, New York, New York 10038, conference rooms
33-2 and 33-3:
(212) 510-7070 (212) 510-7039
(212) 510-7025 (212) 510-7072
(212) 510-7000 (ask for conference rooms 33-2 or 33-3)
Each offer shall be for the purchase of the entire principal amount
of the Notes and shall set forth the following information:
. Fixed rate of interest (payable semiannually)
. Price to the Company (expressed as a percent of par)
. Price to the Public (expressed as a percent of par)
. Effective all-in-cost to the Company after reflecting all
underwriting discounts and commissions (expressed in
percent to the nearest tenth of a basis point)
Each offer must be confirmed by facsimile transmission with a
completed offer form (using the offer form attached to this letter)
to one of the following facsimile numbers at Mudge Rose not later
than 10:30 a.m. Eastern Time on the Sale Date.
(212) 248-2655 (212) 248-2657
An executed Underwriting Agreement signature page must accompany
the faxed offer form. Each telephone offer must provide the
Company with (i) the name of the offeror, (ii) a telephone number
at which such offer may be immediately confirmed and the name of
the individual who will be authorized to provide such confirmation,
and (iii) the other information specified above.
The Company intends to make a prompt determination. If two or more
offers provide identical lowest cost of funds, all other offers
will be rejected and negotiations will proceed with the firms which
made the identical offers. The winning firm or firms will also be
asked to supply any information necessary to complete the
Prospectus Supplement.
January 18, 1994
Page 3
Each offer should be irrevocable until 10:30 a.m., New York City
time, on the Sale Date, unless earlier rejected by the Company or
extended by the offeror. Each offer will be selected or rejected
in its entirety. Any offer not selected by the Company prior to
its expiration as provided herein shall be deemed to have been
rejected. The Company reserves the absolute right to reject any
and all offers at any time prior to the execution of the
Underwriting Agreement or to postpone the Sale Date in its
discretion.
The winning offer will be formally accepted by execution of the
facsimile Underwriting Agreement signature page by 11:00 a.m. in
New York City at the offices of Mudge Rose Guthrie Alexander &
Ferdon by an officer of the Company.
Executed originals of the completed Underwriting Agreement offer
form and Underwriting Agreement must be hand delivered in duplicate
not later than 2:30 p.m. Eastern Time on the Sale Date to the above
offices of Mudge Rose, Attention: Chris Moore.
Please notify me by telephone (214/670-2204) or fax (214/573-3279)
by 4:00 p.m. on January 21, 1994 (i) whether you intend to submit
an offer and (ii) of the names of any other firms who are
participating in your group, if any. It would also be helpful if
you could provide me at that time an example of your calculation of
the all in cost to the Company (after underwriting discount) so
that the Company is in agreement as to the method of calculation.
The calculation should include a sample purchase price, interest
rate and all in cost.
Enclosed is one copy of (i) Amendment No. 1 to Registration
Statement No. 33-45688 filed with the Securities and Exchange
Commission and declared effective on March 4, 1992, (ii) the form
of Underwriting Agreement, (iii) the Company's Form 8-K dated
December 22, 1993, relating to the sale of the Company's
engineering and construction business, (iv) Prospectus Supplement
(to Prospectus dated March 4, 1992) dated August 11, 1992, (v) a
draft of the Prospectus Supplement to be used in connection with
the offering, (vi) the Indenture dated as of February 15, 1992,
between the Company and The First National Bank of Chicago, as
Trustee, (vii) the Company's 1992 Form 10-K, (viii) the Company's
third quarter 1993 Form 10-Q, and (ix) draft Mudge Rose Blue Sky
Memorandum. Additional copies of these documents may be obtained
by contacting Chris Moore at 212/510-7568.
January 18, 1994
Page 4
As counsel to the Underwriters in connection with the sale, Mudge
Rose has estimated its legal fees at $50,000, plus an estimated
$7,500 for disbursements. The winning firm(s) will be responsible
for such fees and disbursements.
Any prospective Underwriter that wishes to discuss the contents of
the Registration Statement and the Prospectus Supplement may do so
by calling me at any time at 214/670-2204.
Any legal or procedural questions regarding the proposed offering
or the enclosed documents, may be discussed with Robert L. Jay
(214/670-2850) of the Company, or Chris Moore (212/510-7568) or Ted
Farris (212/510-7792) of Mudge Rose.
Very truly yours,
Benjamin A. Brown
Enclosures
cc: Dr. Sanford R. Singer
Mr. Arnold Tracy