EXHIBIT 4(a)
RESTATED ARTICLES OF INCORPORATION OF
TEXAS UTILITIES ELECTRIC COMPANY
Pursuant to the provisions of Article 4.07 of the Texas Business
Corporation Act, Texas Utilities Electric Company, a Texas corporation, adopts
the following Restated Articles of Incorporation which accurately copy the
Articles of Incorporation and all amendments thereto that are in effect to date
and as further amended by such Restated Articles of Incorporation as hereinafter
set forth and which contain no other change in any provision thereof:
ARTICLE I. The name of the Corporation is Texas Utilities Electric
Company.
ARTICLE II. The Articles of Incorporation of the Corporation are
amended by the Restated Articles of Incorporation as follows:
The amendment alters or changes Articles III, V, VI, and VII of the
original or amended Articles of Incorporation by deleting the provisions of each
such Article and substituting therefor the provisions set forth in Articles III,
V, VI and VII, respectively, set forth in Annex "I" attached hereto and
incorporated herein. The full text of each provision so altered is set forth in
Annex "I" attached hereto and incorporated herein.
ARTICLE III. The designation and number of outstanding shares of each
class or series entitled to vote thereon as a class were as follows:
Number of Shares Outstanding
Class or Series and Entitled to Vote as a Class
--------------- -------------------------------
Common 156,800,000.00
Preferred 5,613,800.25
The Restated Articles of Incorporation as so amended were adopted by the
shareholders of the Corporation at a meeting held on May 20, 1997. The number
of shares of each class or series entitled to vote as a class or series that
were voted for or against such amendments were as follows:
Class or Series Number of Shares Voted
--------------- -----------------------------
For Against
--- -------
Common 156,800,000 0
Preferred 5,017,963 29,716.25
1
ARTICLE IV. The Articles of Incorporation and all amendments and
supplements thereto are hereby superseded by the Restated Articles of
Incorporation set forth in Annex "I" attached hereto and incorporated herein for
all purposes, which accurately copy the entire text thereof and as amended as
above set forth.
TEXAS UTILITIES ELECTRIC COMPANY
By: /s/ Glen H. Hibbs
---------------------------------------
An Authorized Officer
2
ANNEX I
RESTATED ARTICLES OF INCORPORATION
OF
TEXAS UTILITIES ELECTRIC COMPANY
ARTICLE I
---------
The name of the Corporation is Texas Utilities Electric Company.
ARTICLE II
----------
The purposes for which the Corporation is organized are the
production, generation, manufacture, purchase, transportation, transmission,
distribution, supply and sale to the public of electric current and power, gas,
steam, and any other form or source of light, heat, energy or power; and the
transaction otherwise of any and all lawful business for which corporations may
be incorporated in the State of Texas.
ARTICLE III
-----------
The post office address of the registered office of the Corporation is
Energy Plaza, 1601 Bryan Street, Dallas, Texas, 75201-3411, and the name of its
registered agent at such address is Peter B. Tinkham.
ARTICLE IV
----------
The period of duration of the Corporation is perpetual.
3
ARTICLE V
---------
The number of directors of the Corporation shall be fixed from time to
time as provided for in the Bylaws and shall be one or more.
The number of directors constituting the current Board of Directors of
the Corporation is seven (7), and the names and addresses of the persons serving
as directors are as follows:
Name Address
---- -------
T. L. Baker Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
J. S. Farrington Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
H. Jarrell Gibbs Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
Michael J. McNally Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
Erle A. Nye Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
W. M. Taylor Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
E. L. Watson Energy Plaza, 1601 Bryan Street
Dallas, Texas 75201-3411
ARTICLE VI
----------
The aggregate number of shares of capital stock which the Corporation
shall have authority to issue is 197,000,000 shares, of which 17,000,000 shares
are classified as Preferred Stock, without par value, and 180,000,000 shares are
classified as Common Stock, without par value.
The descriptions of the different classes of capital stock of the
Corporation, and the preferences, designations, relative rights, privileges,
powers, restrictions, limitations and qualifications of said classes of capital
stock, are as follows:
4
Division A --- Preferred Stock
1. Series and Limits of Variations between Series. Subject to the
----------------------------------------------
provisions of Division B of this Article VI which describe certain terms,
characteristics and relative rights and preferences of various series of
Preferred Stock which will be issuable at such time as the Board of Directors of
the Corporation shall provide (which provisions, however, shall not continue
effective as to any shares which are redeemed or purchased and thereby restored
to the status of authorized but unissued shares of Preferred Stock without
designation), the Preferred Stock may be divided into and issued in one or more
series from time to time as herein provided, each series to be so designated as
to distinguish the shares thereof from the shares of all other series and
classes. The authorized number of shares of any such series, the designation of
such series, and the terms, characteristics and relative rights and preferences
thereof (in those respects in which the shares of one series may vary from the
shares of other series as herein provided) shall be established at any time
prior to the issuance thereof by resolution or resolutions of the Board of
Directors of the Corporation. The Preferred Stock of all series shall be of the
same class and of equal rank and shall be identical in all respects, except that
there may be variations in the following particulars:
(a) The rate or rates at which dividends are to accrue on the shares
of such series, hereinafter referred to as the "authorized dividend rate";
(b) The terms and conditions upon which the shares of such series may
be redeemed, and the amount payable in respect to the shares of such series in
case of the redemption thereof at the option of the Corporation (the amount or
amounts so established being hereinafter referred to as the "authorized
redemption price"), and the amount payable in respect of the shares of such
series in case of the redemption thereof for any sinking fund of such series,
which amounts in respect of any series may, but need not, vary according to the
time or circumstances of such action or otherwise;
(c) The amount payable in respect of the shares of such series in
case of liquidation, dissolution or winding up of the Corporation (the amount or
amounts so established being hereinafter referred to as the "authorized
liquidation price"), and the amount payable, if any, in addition to the
authorized liquidation price for each series, in case such liquidation,
dissolution or winding up be voluntary (the amount or amounts so established
being hereinafter referred to as the "authorized liquidation premium"), which
amounts in respect of any series may, but need not, vary according to the time
or circumstances of such action or otherwise;
(d) Any requirement as to any sinking fund or purchase fund for, or
the redemption, purchase or other retirement by the Corporation of, the shares
of such series;
(e) The right, if any, to exchange or convert the shares of such
series into shares of any other series of the Preferred Stock or, to the extent
permitted by law, into securities of the Corporation or any other corporation or
other entity, and the rate or basis, time, manner and conditions of exchange or
conversion or the method by which the same shall be determined; and
(f) The voting rights, if any, of shares of such series.
2. Dividends. Out of the assets of the Corporation legally available
---------
for dividends, the holders of the Preferred Stock of each series shall be
entitled, in preference to the holders of the Common Stock, to receive, but only
when and as declared payable by the Board of Directors, dividends at the
authorized dividend rate for such series, and no more, payable quarterly on
February 1, May 1, August 1, and November 1 in each year, or otherwise as the
Board of Directors may
5
determine or as set forth herein with respect to any particular series of
Preferred Stock, to shareholders of record as of a date not exceeding fifty (50)
days nor less than ten (10) days preceding such dividend payment dates, and such
dividends on the Preferred Stock shall be cumulative, so that, if in any past
dividend period or periods full dividends upon each series of the outstanding
Preferred Stock at the authorized dividend rate or rates therefor shall not have
been paid, the deficiency (without interest) shall be paid or declared and set
apart for payment before any dividends shall be paid upon or set apart for the
Common Stock (other than a dividend payable in Common Stock of the Corporation).
Dividends on all shares of the Preferred Stock of each series shall commence to
accrue and be cumulative from a date established by or upon authority of the
Board of Directors. Any dividends paid on the Preferred Stock in an amount less
than full cumulative dividends accrued or in arrears upon all Preferred Stock
outstanding shall, if more than one series be outstanding, be divided between
the different series in proportion to the aggregate amounts which would be
distributable to the Preferred Stock of each series if full cumulative dividends
were declared and paid thereon.
3. Preference on Liquidation. In the event of any liquidation,
-------------------------
dissolution, or winding up of the Corporation, the holders of the Preferred
Stock of each series shall have a preference over the holders of the Common
Stock until the authorized liquidation price per share for such series, plus, in
case such liquidation, dissolution or winding up shall have been voluntary, the
authorized liquidation premium per share for such series, if any, together in
all cases with unpaid accumulated dividends, if any, shall have been paid or
distributed or declared and set apart for payment or distribution, but the
holders of the Preferred Stock shall be entitled to no further participation in
any such distribution. If upon any such liquidation, dissolution or winding up,
the assets distributable among the holders of the Preferred Stock shall be
insufficient to permit the payment of the full preferential amounts aforesaid,
then said assets shall be distributed among the holders of each series of the
Preferred Stock then outstanding, ratably in proportion to the full preferential
amounts to which they are respectively entitled. Nothing in this Section 3
shall be deemed to prevent the purchase or redemption of Preferred Stock in any
manner permitted by Section 4 of this Division A, nor shall anything in this
Section 3 be deemed to prevent the purchase or redemption by the Corporation of
shares of its Common Stock. No such purchase or redemption shall be deemed to
be a liquidation, dissolution, or winding up of the Corporation or a
distribution of assets to its Common Shareholders within the meaning of this
Section 3 whether or not shares of Common Stock so redeemed or purchased shall
be retired, nor shall a consolidation or merger of the Corporation or a sale or
transfer of all or substantially all of its assets as an entirety be regarded as
a liquidation, dissolution or winding up of the Corporation within the meaning
of this Section 3.
4. Redemption and Repurchase. The Corporation may at any time or
-------------------------
from time to time, by resolution of the Board of Directors, redeem all or any
part of the Preferred Stock, or of any series thereof, by paying in cash the
authorized redemption price applicable thereto plus the amount of unpaid
accumulated dividends, if any, to the date of such redemption. If less than all
the shares of one series of Preferred Stock is to be redeemed, the shares to be
redeemed shall be selected ratably or by lot, in such manner as may be
prescribed by resolution of the Board of Directors. Notice of such redemption
shall be mailed to each holder of redeemable shares being called, not less than
twenty (20) nor more than sixty (60) days before the date fixed for redemption,
at his address as it appears
6
on the stock transfer books of the Corporation, with postage thereon prepaid.
Such notice of redemption of such shares shall set forth the series or part
thereof to be redeemed, the date fixed for redemption, the redemption price, and
the place at which the shareholders may obtain payment of the redemption price
upon surrender of their respective share certificates. The Corporation may at
any time revoke or rescind its decision to redeem preferred stock subsequent to
giving notice to the preferred shareholders but prior to the redemption date so
long as the Company shall not have deposited with the bank or trust company
and/or irrevocably directed the bank or trust company to apply, from moneys held
by it available to be used for the redemption of shares, an amount in cash
sufficient to redeem all of the shares. From and after the date fixed in any
such notice as the date of redemption, unless default shall be made by the
Corporation in providing funds sufficient for such redemption at the time and
place specified for the payment thereof pursuant to said notice or the
Corporation revokes its decision to redeem the preferred stock prior to the
redemption date, all dividends on the shares so redeemed shall cease to accrue,
and all rights of the holders of such shares as shareholders of the Corporation
except only the right to receive the redemption funds to which they are
entitled, shall cease and determine.
The Corporation may, on or prior to the date fixed for any redemption,
deposit with any bank or trust company, or any entity duly appointed and acting
as a transfer agent of the Corporation, as a trust fund, a sum sufficient to
redeem shares called for redemption, with irrevocable instructions and authority
to such bank or trust company to give or complete the notice of redemption
thereof and to pay, on or after the date fixed for such redemption, to the
respective holders of shares, as evidenced by a list of holders of such shares
certified by an officer of the Corporation, the redemption price upon the
surrender of their respective share certificates, in the case of certificated
shares. Thereafter, from and after the date fixed for redemption such shares
shall be deemed to be redeemed and dividends thereon shall cease to accrue after
such date fixed for redemption. Such deposit shall be deemed to constitute full
payment of such shares to their holders. From and after the date such deposit is
made and such instruction given, such shares shall no longer be deemed to be
outstanding, and the holders thereof shall cease to be shareholders with respect
to such shares, and shall have no rights with respect thereto except the right
to receive from the bank or trust company payment of the redemption price of
such shares, without interest, upon the surrender of their respective
certificates therefor, and any right to convert such shares which may exist. In
case the holders of such shares shall not, within six (6) years after such
deposit, claim the amount deposited for redemption thereof, such bank or trust
company shall upon demand pay over to the Corporation the balance of such amount
so deposited to be held in trust and such bank or trust company shall thereupon
be relieved of all responsibility to the holders thereof, and any interest
accrued thereon shall be paid over to the Corporation and become its property.
Nothing in this Section 4 contained shall limit the right of the
Corporation to purchase or otherwise acquire shares of the Preferred Stock to
the extent permitted by law.
Shares of Preferred Stock of the Corporation redeemed or purchased by
the Corporation shall be restored to the status of authorized but unissued
shares of Preferred Stock without designation, and may from time to time be
reissued as provided in Section 1 of this Division A. All such redemptions and
purchases of Preferred Stock of the Corporation shall be effected in accordance
with the laws of the State of Texas governing redemption or purchase of
redeemable shares.
7
5. Voting Rights. Except for those purposes only for which the right
-------------
to vote is expressly conferred in this Article VI upon holders of the Preferred
Stock, no holders of the Preferred Stock shall be entitled to notice of or to
vote at any meeting of shareholders of the Corporation or at any election of the
Corporation or the shareholders thereof.
If and when dividends payable on any of the Preferred Stock shall be
in default in an amount equal to six full quarterly payments or more per share,
and thereafter until all dividends on any of the Preferred Stock in default
shall have been paid, the holders of all of the Preferred Stock, voting as a
class in contradistinction to the Common Stock as a class, shall be entitled to
elect the smallest number of directors necessary to constitute a majority of the
full Board of Directors, and the holders of the Common Stock, voting separately
as a class, shall be entitled to elect the remaining directors of the
Corporation. The terms of office as directors of all persons who may be
directors of the Corporation at the time shall terminate upon the election of a
majority of the Board of Directors by the holders of the Preferred Stock, except
that if the holders of the Common Stock shall not have elected the remaining
directors of the Corporation then, and only in that event, the directors of the
Corporation in office just prior to the election of a majority of the Board of
Directors by the holders of the Preferred Stock shall elect the remaining
directors to the Corporation. Thereafter, while such default continues and the
majority of the Board is being elected by the holders of the Preferred Stock,
the remaining directors, whether elected by directors, as aforesaid, or whether
originally or later elected by holders of the Common Stock, shall continue in
office until their successors are elected by holders of the Common Stock and
shall qualify. The term of office of the directors so elected by the holders of
the Preferred Stock, voting separately as a class, and of the directors elected
by the holders of the Common Stock, voting separately as a class, or elected by
directors, as aforesaid, shall be until the next annual meeting of shareholders
or until the privilege of the holders of the Preferred Stock to elect directors
shall terminate as hereinafter provided, whichever shall be the earlier date and
until their successors shall have been elected and shall have qualified.
If and when all dividends then in default on all of the Preferred
Stock shall be paid (such dividends to be declared and paid out of any funds
legally available therefor as soon as reasonably practicable), the holders of
the Preferred Stock shall be divested of any privilege with respect to the
election of directors which is conferred upon the holders of such Preferred
Stock under this Section 5, and the voting power of the holders of the Preferred
Stock and the holders of the Common Stock shall revert to the status existing
before the first dividend payment date on which dividends on any of the
Preferred Stock were not paid in full, but always subject to the same provisions
for vesting such privilege in the holders of the Preferred Stock in case of
further like default or defaults in the payment of dividends thereon. Upon
termination of any such voting privilege upon payment of all accumulated and
defaulted dividends on the Preferred Stock, the terms of office of all persons
who have been elected directors of the Corporation by vote of the holders of the
Preferred Stock as a class, pursuant to such voting privilege, shall forthwith
terminate, and the resulting vacancies shall be filled by the vote of a majority
of the remaining directors.
In case of any vacancy in the office of a director occurring among the
directors elected by the holders of the Preferred Stock, voting as a class, the
remaining directors elected by the holders of the Preferred Stock, by
affirmative vote of a majority thereof, or the remaining director so elected if
there be but one, may elect a successor or successors to hold office for the
unexpired term or terms of the director or directors whose place or places shall
be vacant. In case of any vacancy in the office of a director occurring among
the directors elected by the holders of the Common Stock, voting
8
separately as a class, or elected by directors, as aforesaid, the remaining
directors so elected, by affirmative vote of a majority thereof, or the
remaining director so elected if there be but one, may elect a successor or
successors to hold office for the unexpired term or terms of the director or
directors whose place or places shall be vacant.
Whenever dividends on the Preferred Stock shall be in default, as
provided in this Section 5, it shall be the duty of the officers of the
Corporation, or in the event of their failure to do so within twenty (20) days
of such default, the privilege is granted any holder of Preferred Stock who
shall first demand the right so to do by written notice to the Corporation,
forthwith to cause notice to be given to the holders of the Preferred Stock and
to the holders of the Common Stock of a meeting to be held at such time as the
Corporation's officers, or such holder of Preferred Stock, as the case may be,
may fix, not less than ten (10) nor more than sixty (60) days after the accrual
of such privilege, for the purpose of electing directors. Each holder of record
of Preferred Stock, or his legal representative, shall be entitled at such
meeting to one vote for each share of Preferred Stock standing in his name on
the books of the Corporation. At each meeting of shareholders held for such
purpose, the presence in person or by proxy of the holders of a majority of the
Common Stock shall be required to constitute a quorum of the Common Stock for
the election of directors, and the presence in person or by proxy of the holders
of a majority of the Preferred Stock shall be required to constitute a quorum of
the Preferred Stock for the election of directors; provided, however, that the
absence of a quorum of the holders of stock of either the Preferred Stock or the
Common Stock shall not prevent the election at any such meeting or adjournment
thereof of directors by such other class, if the necessary quorum of the holders
of stock of such other class is present in person or by proxy at such meeting or
any adjournment thereof, and provided, that in the event a quorum of the holders
of the Common Stock is present but a quorum of the holders of the Preferred
Stock is not present, then the directors so elected by the holders of the Common
Stock shall not assume their offices and duties but the directors in office
immediately prior thereto shall remain in office until the holders of the
Preferred Stock, with a quorum present, shall have elected the directors they
shall be entitled to elect; and provided, further, that in the absence of a
quorum of holders of stock of either class, a majority of the holders of the
stock of the class which lacks a quorum who are present in person or by proxy,
shall have power to adjourn the election of the directors to be elected by such
class from time to time without notice other than announcement at the meeting,
until the requisite quorum of holders of such class shall be present in person
or by proxy, but such adjournment shall not be made to a date beyond the date
for the mailing of the notice of the next annual meeting of shareholders of the
Corporation or special meeting in lieu thereof.
6. Restrictions on Certain Corporate Action.
----------------------------------------
(a) So long as any shares of the Preferred Stock are outstanding, the
Corporation shall not, without the consent (given by vote at a meeting called
for that purpose) of the holders of at least a majority of the total number of
shares of the Preferred Stock then outstanding:
(1) Create or authorize any new stock ranking prior to the
Preferred Stock as to dividends or in liquidation, dissolution, winding up or
distribution, or create or authorize any security convertible into shares of any
such stock; or
(2) Amend, alter, change or repeal any of the express terms of
the Preferred Stock then outstanding in a manner substantially prejudicial to
the holders thereof, provided however, that if such amendment, alteration, or
change affects less than all series of Preferred Stock,
9
only the consent of the holders of a majority of the aggregate of the series so
affected shall be required.
(b) So long as any shares of the Preferred Stock are outstanding, the
Corporation shall not, without the consent (given by vote at a meeting called
for that purpose) of the holders of a majority of the total number of shares of
the Preferred Stock, considered as one class, then outstanding:
(1) Create or assume any unsecured indebtedness maturing more
than one year after the date of its creation or assumption unless and until the
Corporation's net earnings available for the payment of interest (gross
operating revenues plus other income, minus operating expenses, including
depreciation expense and taxes, other than income, profits, and other taxes,
measured by, or dependent on, income) as determined by generally accepted
accounting practices and as stated on the books of account of the Corporation
for a period of twelve consecutive calendar months ending not more than three
months prior to the beginning of the calendar month in which such indebtedness
shall be created or assumed, shall have been at least twice the interest charges
(using, for the purpose of this computation with respect to indebtedness with
interest rates that are not fixed, the interest rate in effect at the end of
such twelve month period) on all outstanding indebtedness created or assumed by
the Corporation and payable more than one year from the date of such creation or
assumption, including the interest charges on the indebtedness so to be created
or assumed (using, for the purpose of this computation, the interest rate in
effect at the time of incurrence or assumption of such indebtedness); provided
that the requirements of this subparagraph (1) shall not apply to indebtedness
created or assumed to refund by payment, replacement, retirement, acquisition,
purchase, exchange, redemption, surrender or otherwise all outstanding shares of
the Preferred Stock or any indebtedness outstanding at any time and maturing
more than one year after the date of creation or assumption of such refunded
indebtedness; or
(2) Issue, sell or dispose of any shares of the Preferred
Stock in addition to the shares of Preferred Stock outstanding, or of any other
class of stock ranking prior to, or on a parity with, the Preferred Stock as to
dividends or distributions, unless the net income of the Corporation, determined
after provisions for depreciation and all taxes, and in accordance with
generally accepted accounting principles to be available for the payment of
dividends for a period of twelve (12) consecutive calendar months within the
fifteen (15) calendar months immediately preceding the issuance, sale or
disposition of such stock is at least equal to twice the annual dividend
requirements on all outstanding shares of the Preferred Stock and of all other
classes of stock ranking prior to, or on a parity with, the Preferred Stock as
to dividends or distributions, including the shares proposed to be issued;
provided that there shall be excluded from the foregoing computation interest
charges on all indebtedness and dividends on all stock which is to be retired in
connection with the issue of such additional shares of Preferred Stock, and
where such additional shares of Preferred Stock are to be issued in connection
with the acquisition of new property, the net earnings of the property to be so
acquired may be included on a pro forma basis in the foregoing computation,
computed on the same basis as the net earnings of the Corporation; or
(3) Pay any dividend on any stock of the Corporation junior to
the Preferred Stock if immediately after such payment the retained earnings of
the Corporation would be less than one and one-half (1-1/2) times the full
annual dividend requirement on the Preferred Stock issued and outstanding and on
any other issued and outstanding stock of the Corporation
10
ranking on a parity with or having a priority over the Preferred Stock in
respect of dividends or of payments in liquidation.
The term "net earnings available for the payment of interest" shall
mean the net earnings of the Corporation as shown by its books of account, as
based on generally accepted principles of accounting, and shall include the
following items and be calculated in the following manner:
(1) Its gross operating revenues and other income, including
revenues from rental of plants or systems and net income from
miscellaneous non-operating sources, and excluding any extraordinary
charges to income as defined by generally accepted accounting
principles, any regulatory disallowances, the effect of any change in
accounting principles promulgated by the Financial Accounting
Standards Board, and any other non-cash, non-recurring book losses,
(2) Its operating expenses, including expenses for current
repairs and maintenance, insurance and rental expenses for plants or
systems and other rentals,
(3) Its provisions out of income for renewals, replacement,
depreciation, depletion or retirement of property,
(4) Its taxes charged to income other than income, profits, and
other taxes measured by, or dependent on, income, and
(5) The balance remaining after deducting the sum of the amounts
of (2), (3) and (4) from the amount of item (1) above, shall be the
"net earnings available for the payment of interest" for the purposes
of this Section 6.
For purposes of this Section 6, the term "indebtedness" shall not
include any obligation or liability which, by its terms or otherwise, is non-
recourse to the Corporation whether or not such obligation or liability is
reflected in the financial statements of the Corporation.
Division B --- Series of Preferred Stock
Each series of Preferred Stock will be issuable as provided for in
Division A of this Article. Unless otherwise specifically provided for, none of
such series will have any fixed liquidation premium or exchange or conversion
rights.
1. The $4.50 Preferred Stock. 74,367 shares of the authorized stock
-------------------------
classified as Preferred Stock as provided in Division A of this Article VI shall
constitute the first series of Preferred Stock and are designated as $4.50
Preferred Stock; the fixed dividend rate on the shares of such series is four
dollars and fifty cents ($4.50) per share per annum; the fixed redemption price
on the shares of such series is $110 per share; the fixed liquidation price on
the shares of such series is $100 per share.
2. The $4.24 Preferred Stock. 100,000 shares of the authorized stock
-------------------------
classified as Preferred Stock as provided in Division A of this Article VI shall
constitute the second series of Preferred Stock and are designated as $4.24
Preferred Stock; the fixed dividend rate on the shares of such series is four
dollars and twenty-four cents ($4.24) per share per annum; the fixed redemption
price on the shares of such series is $103.50 per share; the fixed liquidation
price on the shares of such series is $100 per share.
11
3. The $4 (Dallas Power Series) Preferred Stock. 70,000 shares of
--------------------------------------------
the authorized stock classified as Preferred Stock as provided in Division A of
this Article VI shall constitute the third series of Preferred Stock and are
designated as $4 (Dallas Power Series) Preferred Stock; the fixed dividend rate
on the shares of such series is four dollars ($4) per share per annum; the fixed
redemption price on the shares of such series is $103.56 per share; the fixed
liquidation price on the shares of such series is $100 per share.
4. The $4.80 Preferred Stock. 100,000 shares of the authorized stock
-------------------------
classified as Preferred Stock as provided in Division A of this Article VI shall
constitute the fourth series of Preferred Stock and are designated as $4.80
Preferred Stock; the fixed dividend rate on the shares of such series is four
dollars and eighty cents ($4.80) per share per annum; the fixed redemption price
on the shares of such series is $102.79 per share; the fixed liquidation price
on the shares of such series is $100 per share.
5. The $7.20 Preferred Stock. All shares redeemed.
-------------------------
6. The $6.84 Preferred Stock. All shares redeemed.
-------------------------
7. The $7.48 Preferred Stock. All shares redeemed.
-------------------------
8. The $4 (Texas Electric Series) Preferred Stock. 110,000 shares of
----------------------------------------------
the authorized stock classified as Preferred Stock as provided in Division A of
this Article VI shall constitute the eighth series of Preferred Stock and are
designated as $4 (Texas Electric Series) Preferred Stock; the fixed dividend
rate on the shares of such series is Four Dollars and No Cents ($4.00) per share
per annum; the fixed redemption price on the shares of such series is $102 per
share; the fixed liquidation price on the shares of such series is $100 per
share.
9. The $4.56 (Texas Electric Series) Preferred Stock. 64,947 shares
-------------------------------------------------
of the authorized stock classified as Preferred Stock as provided in Division A
of this Article VI shall constitute the ninth series of Preferred Stock and are
designated as $4.56 (Texas Electric Series) Preferred Stock; the fixed dividend
rate on the shares of such series is Four Dollars and Fifty-six Cents ($4.56)
per share per annum, and such dividends shall be payable quarterly on January 1,
April 1, July 1 and October 1 of each year; the fixed redemption price on the
shares of such series is $112.00 per share; the fixed liquidation price on the
shares of such series is $100 per share.
10. The $4.64 Preferred Stock. 100,000 shares of the authorized
-------------------------
stock classified as Preferred Stock as provided in Division A of this Article VI
shall constitute the tenth series of Preferred Stock and are designated as $4.64
Preferred Stock; the fixed dividend rate on the shares of such series is Four
Dollars and Sixty-four Cents ($4.64) per share per annum, and such dividends
shall be payable quarterly on January 1, April 1, July 1 and October 1 of each
year; the fixed redemption price on the shares of such series is $103.25 per
share; the fixed liquidation price on the shares of such series is $100 per
share.
12
11. The $5.08 Preferred Stock. 80,000 shares of the authorized stock
-------------------------
classified as Preferred Stock as provided in Division A of this Article VI shall
constitute the eleventh series of Preferred Stock and are designated as $5.08
Preferred Stock; the fixed dividend rate on the shares of such series is Five
Dollars and Eight Cents ($5.08) per share per annum; the fixed redemption price
on the shares of such series is $103.60 per share; the fixed liquidation price
on the shares of such series is $100 per share.
12. The $8.92 Preferred Stock. All shares redeemed.
-------------------------
13. The $7.44 Preferred Stock. All shares redeemed.
-------------------------
14. The $8.44 Preferred Stock. All shares redeemed.
-------------------------
15. The $9.36 Preferred Stock. All shares redeemed.
-------------------------
16. The $8.32 Preferred Stock. All shares redeemed.
-------------------------
17. The $10.12 Preferred Stock. All shares redeemed.
--------------------------
18. The $4 (Texas Power Series) Preferred Stock. 70,000 shares of
-------------------------------------------
the authorized stock classified as Preferred Stock as provided in Division A of
this Article VI shall constitute the eighteenth series of Preferred Stock and
are designated as $4 (Texas Power Series) Preferred Stock; the fixed dividend
rate on the shares of such series is Four Dollars and No Cents ($4.00) per share
per annum; the fixed redemption price on the shares of such series is $102 per
share; the fixed liquidation price on the shares of such series is $100 per
share.
19. The $4.56 (Texas Power Series) Preferred Stock. 133,628 shares
----------------------------------------------
of the authorized stock classified as Preferred Stock as provided in Division A
of this Article VI shall constitute the nineteenth series of Preferred Stock and
are designated as $4.56 (Texas Power Series) Preferred Stock; the fixed dividend
rate on the shares of such series is Four Dollars and Fifty-six Cents ($4.56)
per share per annum; the fixed redemption price on the shares of such series is
$112 per share; the fixed liquidation price on the shares of such series is $100
per share.
20. The $4.84 Preferred Stock. 70,000 shares of the authorized stock
-------------------------
classified as Preferred Stock as provided in Division A of this Article VI shall
constitute the twentieth series of Preferred Stock and are designated as $4.84
Preferred Stock; the fixed dividend rate on the shares of such series is Four
Dollars and Eighty-four Cents ($4.84) per share per annum; the fixed redemption
price on the shares of such series is $101.79 per share; the fixed liquidation
price on the shares of such series is $100 per share.
13
21. The $4.76 Preferred Stock. 100,000 shares of the authorized
-------------------------
stock classified as Preferred Stock as provided in Division A of this Article VI
shall constitute the twenty-first series of Preferred Stock and are designated
as $4.76 Preferred Stock; the fixed dividend rate on the shares of such series
is Four Dollars and Seventy-six Cents ($4.76) per share per annum; the fixed
redemption price on the shares of such series is $102 per share; the fixed
liquidation price on the shares of such series is $100 per share.
22. The $4.44 Preferred Stock. 150,000 shares of the authorized
-------------------------
stock classified as Preferred Stock as provided in Division A of this Article VI
shall constitute the twenty-second series of Preferred Stock and are designated
as $4.44 Preferred Stock; the fixed dividend rate on the shares of such series
is Four Dollars and Forty-four Cents ($4.44) per share per annum; the fixed
redemption price on the shares of such series is $102.61 per share; the fixed
liquidation price on the shares of such series is $100 per share.
23. The $7.80 Preferred Stock. All shares redeemed.
-------------------------
24. The $7.24 Preferred Stock. All shares redeemed.
-------------------------
25. The $8.20 Preferred Stock. All shares redeemed.
-------------------------
26. The $9.32 Preferred Stock. All shares redeemed.
-------------------------
27. The $8.68 Preferred Stock. All shares redeemed.
-------------------------
28. The $8.16 Preferred Stock. All shares redeemed.
-------------------------
29. The $8.84 Preferred Stock. All shares redeemed.
-------------------------
30. The $10.92 Preferred Stock. All shares redeemed.
--------------------------
31. The $10.08 Preferred Stock. All shares redeemed.
--------------------------
32. The $11.32 Preferred Stock. All shares redeemed.
--------------------------
33. The Adjustable Rate Cumulative Preferred Stock, Series A.
--------------------------------------------------------
884,700 shares of the authorized stock classified as Preferred Stock as provided
in Division A of this Article VI shall constitute the thirty-third series of
Preferred Stock and are designated as Adjustable Rate Cumulative Preferred
Stock, Series A, which series shall have, in addition to the general terms and
characteristics of all the authorized shares of Preferred Stock of the
Corporation, the following distinctive terms and characteristics: (a) The
thirty-third series of Preferred Stock shall have a dividend rate for the
initial dividend payment period ending July 31, 1984, at the rate of 11.04% per
annum, and for each subsequent quarterly dividend period at the Applicable Rate
(as hereinafter defined) from time to time in effect, provided that the dividend
rate on the thirty-third series of Preferred Stock for any dividend period shall
in no event be less than 6.50% per annum or
14
greater than 13% per annum. Except as provided below in this paragraph, the
"Applicable Rate" for any dividend period will be 2.50% less than the highest of
(i) the Treasury Bill Rate, (ii) the Ten Year Constant Maturity Rate and (iii)
the Twenty Year Constant Maturity Rate (each as hereinafter defined) for such
dividend period. In the event that the Corporation determines in good faith that
for any reason one or more of such rates cannot be determined for any dividend
period, then the Applicable Rate for such dividend period shall be 2.50% less
than the higher of whichever of such rates can be so determined. In the event
that the Corporation determines in good faith that none of such rates can be
determined for any dividend period, then the Applicable Rate in effect for the
preceding dividend period shall be continued for such dividend period.
Except as provided below in this paragraph, the "Treasury Bill Rate"
for each dividend period will be the arithmetic average of the two most recent
weekly per annum secondary market discount rates (or the one weekly per annum
secondary market discount rate, if only one such rate shall be published during
the relevant Calendar Period (as defined below)) for three-month U. S.
Treasury bills, as published weekly by the Federal Reserve Board during the
Calendar Period immediately prior to the last ten calendar days of July,
October, January or April, as the case may be, prior to the dividend period for
which the Applicable Rate is being determined. In the event that the Federal
Reserve Board does not publish such a weekly per annum secondary market discount
rate during any such Calendar Period, then the Treasury Bill Rate for such
dividend period shall be the arithmetic average of the two most recent weekly
per annum secondary market discount rates (or the one weekly per annum secondary
market discount rate, if only one such rate shall be published during such
Calendar Period) for the three-month U. S. Treasury bills, as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U. S.
Government department or agency selected by the Corporation. In the event that
a per annum secondary market discount rate for three-month U. S. Treasury bills
shall not be published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U. S. Government department or agency during such Calendar
Period, then the Treasury Bill Rate for such dividend period shall be the
arithmetic average of the two most recent weekly per annum secondary market
discount rates (or the one weekly per annum secondary market discount rate, if
only one such rate shall be published during such Calendar Period) for all of
the U. S. Treasury bills then having maturities of not less than 80 nor more
than 100 days, as published during such Calendar Period by the Federal Reserve
Board or, if the Federal Reserve Board shall not publish such rates, by any
Federal Reserve Bank or by any U. S. Government department or agency selected by
the Corporation. In the event that the Corporation determines in good faith
that for any reason no such U. S. Treasury bill rates are published as provided
above during such Calendar Period, then the Treasury Bill Rate for such dividend
period shall be the arithmetic average of the per annum secondary market
discount rates based upon the closing bids during such Calendar Period for each
of the issues of marketable non-interest bearing U. S. Treasury securities with
a maturity of not
15
less than 80 nor more than 100 days from the date of each such quotation, as
quoted daily for each business day in New York City (or less frequently if daily
quotations shall not be generally available) to the Corporation by at least
three recognized U. S. Government securities dealers selected by the
Corporation.
Except as provided below in this paragraph, the "Ten Year Constant
Maturity Rate" for each such dividend period shall be the arithmetic average of
the two most recent weekly per annum Ten Year Average Yields (as defined below)
(or the one weekly per annum Ten Year Average Yield, if only one such Yield
shall be published during the relevant Calendar Period as provided below), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately prior to the last ten calendar days of July, October, January or
April, as the case may be, prior to the dividend period for which the Applicable
Rate is being determined. In the event that the Federal Reserve Board does not
publish such a weekly per annum Ten Year Average Yield during such Calendar
Period, then the Ten Year Constant Maturity Rate for such dividend period shall
be the arithmetic average of the two most recent weekly per annum Ten Year
Average Yields, (or the one weekly per annum Ten Year Average Yield, if only one
such yield shall be published during such Calendar Period), as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U. S.
Government department or agency selected by the Corporation. In the event that
a per annum Ten Year Average Yield shall not be published by the Federal Reserve
Board or by any Federal Reserve Bank or by any U. S. Government department or
agency during such Calendar Period, then the Ten Year Constant Maturity Rate for
such dividend period shall be the arithmetic average of the two most recent
weekly per annum average yields to maturity (or the one weekly average yield to
maturity, if only one such yield shall be published during such Calendar Period)
for all of the actively traded marketable U. S. Treasury fixed interest rate
securities (other than Special Securities, as defined below) then having
maturities of not less than eight nor more than twelve years, as published
during such Calendar Period by the Federal Reserve Board or, if the Federal
Reserve Board shall not publish such yields, by any Federal Reserve Bank or by
any U. S. Government department or agency selected by the Corporation. In the
event that the Corporation determines in good faith that for any reason the
Corporation cannot determine the Ten Year Constant Maturity Rate for any
dividend period as provided above in this paragraph, then the Ten Year Constant
Maturity Rate for such dividend period shall be the arithmetic average of the
per annum average yields to maturity based upon the closing bids during such
Calendar Period for each of the issues of actively traded marketable U. S.
Treasury fixed interest rate securities (other than Special Securities) with a
final maturity date not less than eight nor more than twelve years from the date
of each such quotation, as quoted daily for each business day in New York City
(or less frequently if daily quotations shall not be generally available) to the
Corporation by at least three recognized U. S. Government securities dealers
selected by the Corporation.
Except as provided below in this paragraph, the "Twenty Year Constant
Maturity Rate" for each such dividend period shall be the arithmetic average of
the two most recent weekly per annum Twenty Year Average Yields (as defined
below) (or the one weekly per annum Twenty Year Average Yield, if only one such
Yield shall be published during the relevant Calendar Period), as published
weekly by the Federal Reserve Board during the Calendar Period immediately prior
to the last ten calendar days of July, October, January or April, as the case
may be, prior to the dividend period for which the Applicable Rate is being
determined. In the event that the Federal Reserve Board does not publish such a
weekly per annum Twenty Year Average Yield during such Calendar
16
Period, then the Twenty Year Constant Maturity Rate for such dividend period
shall be the arithmetic average of the two most recent weekly per annum Twenty
Year Average Yields (or the one weekly per annum Twenty Year Average Yield, if
only one such Yield shall be published during such Calendar Period), as
published weekly during such Calendar Period by any Federal Reserve Bank or by
any U. S. Government department or agency selected by the Corporation. In the
event that a per annum Twenty Year Average Yield shall not be published by the
Federal Reserve Board or by any Federal Reserve Bank or by any U. S. Government
department or agency during such Calendar Period, then the Twenty Year Constant
Maturity Rate for such dividend period shall be the arithmetic average of the
two most recent weekly per annum average yields to maturity (or the one weekly
average yield to maturity, if only one such yield shall be published during such
Calendar Period) for all of the actively traded marketable U. S. Treasury fixed
interest rate securities (other than Special Securities) then having maturities
of not less than eighteen nor more than twenty-two years, as published during
such Calendar Period by the Federal Reserve Board or, if the Federal Reserve
Board shall not publish such yields, by any Federal Reserve Bank or by any U. S.
Government department or agency selected by the Corporation. In the event that
the Corporation determines in good faith that for any reason the Corporation
cannot determine the Twenty Year Constant Maturity Rate for any dividend period
as provided above in this paragraph, then the Twenty Year Constant Maturity Rate
for such dividend period shall be the arithmetic average of the per annum
average yields to maturity based upon the closing bids during such Calendar
Period for each of the issues of actively traded marketable U. S. Treasury fixed
interest rate securities (other than Special Securities) with a final maturity
date not less than eighteen nor more than twenty-two years from the date of each
such quotation, as quoted daily for each business day in New York City (or less
frequently if daily quotations shall not be generally available) to the
Corporation by at least three recognized U. S. Government securities dealers
selected by the Corporation.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the
Twenty Year Constant Maturity Rate shall each be rounded to the nearest five
one-hundredths of a percentage point.
The amount of dividends per share payable for each dividend period
shall be computed by dividing the Applicable Rate for such period by four and
applying the rate derived from such division against the fixed liquidation price
of $100 per share of the thirty-third series. The amount of dividends payable
for any period shorter than a full quarterly dividend period and for the initial
dividend period shall be computed on the basis of a 360-day year of 30-day
months and the actual number of days which have elapsed in such period.
The Applicable Rate with respect to each dividend period will be
calculated as promptly as practicable by the Corporation according to the
appropriate method described herein. The mathematical accuracy of each such
calculation will be confirmed in writing by independent accountants of
recognized standing. The Corporation will cause each dividend rate to be
published in a newspaper of general circulation in New York City prior to the
commencement of the new dividend period to which it applies and will cause
notice of such Applicable Rate to be mailed to the holders of the thirty-third
series.
As used herein, the term "Calendar Period" means a period of fourteen
calendar days; the term "Special Securities" means securities which can, at the
option of the holder, be surrendered at face value in payment of any Federal
estate tax or which provide tax benefits to the holder and are priced to reflect
such tax benefits or which were originally issued at a deep or substantial
discount;
17
the term "Ten Year Average Yield" means the average yield to maturity for
actively traded marketable U. S. Treasury fixed interest rate securities
(adjusted to constant maturities of ten years); and the term "Twenty Year
Average Yield" means the average yield to maturity for actively traded
marketable U. S. Treasury fixed interest rate securities (adjusted to constant
maturities of twenty years).
(b) Said thirty-third series shall not be redeemable prior to June 1,
1989; and on and after that date shall be redeemable at any time, in whole or in
part, at $103 per share, if redeemed prior to June 1, 1994, and, if redeemed
thereafter, at $100 per share, plus in each case accrued and unpaid dividends to
the redemption date.
(c) The amount payable upon the shares of said thirty-third series in
the event of involuntary dissolution, liquidation or winding up of the
Corporation shall be $100 per share plus an amount equivalent to the accrued and
unpaid dividends thereon, if any, to the date of such involuntary dissolution,
liquidation or winding up, and the amount payable upon shares of said thirty-
third series in the event of voluntary dissolution, liquidation or winding up of
the Corporation shall be an amount equivalent to the then redemption price
(including an amount equivalent to accumulated and unpaid dividends thereon, if
any) of shares of said thirty-third series.
34. The Adjustable Rate Cumulative Preferred Stock, Series B. All
--------------------------------------------------------
shares redeemed.
35. The $9.48 Cumulative Preferred Stock. All shares redeemed.
------------------------------------
36. The $8.92 Cumulative Preferred Stock. All shares redeemed.
------------------------------------
37. The $10.00 Cumulative Preferred Stock. All shares redeemed.
-------------------------------------
38. The Stated Rate Auction Preferred Stock, Series A. All
-------------------------------------------------
shares redeemed.
39. The $9.64 Cumulative Preferred Stock. All shares redeemed.
------------------------------------
40. The Flexible Adjustable Rate Preferred Stock, Series A. All
------------------------------------------------------
shares redeemed.
41. The Flexible Adjustable Rate Preferred Stock, Series B. All
------------------------------------------------------
shares redeemed.
42. The $10.375 Cumulative Preferred Stock. All shares redeemed.
--------------------------------------
43. The $9.875 Cumulative Preferred Stock. All shares redeemed.
-------------------------------------
44. The $8.20 Cumulative Preferred Stock. 338,872.25 shares of the
------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-fourth series of Preferred Stock and are
designated as $8.20 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of Preferred Stock of the Company, the following distinctive terms and
characteristics:
18
(a) The forty-fourth series of Preferred Stock shall have a fixed
dividend rate of Eight Dollars and Twenty Cents ($8.20) per share per annum; and
dividends on shares of the forty-fourth series of Preferred Stock shall be
cumulative from the date of issuance and shall be payable on the first days of
January, April, July and October in each year, commencing April 1, 1993;
(b) Said forty-fourth series shall not be redeemable prior to January
1, 1998; and on and after that date the fixed redemption price on the shares of
such forty-fourth series shall be $100.00 per share plus unpaid and accumulated
dividends, if any, to the redemption date;
(c) The amount payable upon the shares of said forty-fourth series in
the event of voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be $100 per share plus an amount equivalent to the unpaid and
accumulated dividends thereon, if any, to the date of such voluntary or
involuntary dissolution, liquidation or winding up.
45. The $7.98 Cumulative Preferred Stock. 474,000 shares of the
------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-fifth series of Preferred Stock and are
designated as $7.98 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of Preferred Stock of the Company, the following distinctive terms and
characteristics:
(a) The forty-fifth series of Preferred Stock shall have a fixed
dividend rate of Seven Dollars and Ninety-Eight Cents ($7.98) per share per
annum. Dividends on shares of the forty-fifth series of Preferred Stock shall
be cumulative from the date of issuance and shall be payable on the first days
of January, April, July and October in each year commencing July 1, 1993.
(b) Said forty-fifth series shall not be redeemable prior to April 1,
2003; and on and after that date the fixed redemption price on the shares of
such forty-fifth series shall be $103.99 per share if redeemed after March 31,
2003, but on or prior to March 31, 2004, $103.59 per share if redeemed after
March 31, 2004, but on or prior to March 31, 2005, $103.19 per share if redeemed
after March 31, 2005, but on or prior to March 31, 2006, $102.79 per share if
redeemed after March 31, 2006, but on or prior to March 31, 2007, $102.39 per
share if redeemed after March 31, 2007, but on or prior to March 31, 2008,
$101.99 per share if redeemed after March 31, 2008, but on or prior to March 31,
2009, $101.60 per share if redeemed after March 31, 2009, but on or prior to
March 31, 2010, $101.20 per share if redeemed after March 31, 2010, but
on or prior to March 31, 2011, $100.80 per share if redeemed after March 31,
2011, but on or prior to March 31, 2012, $100.40 per share if redeemed after
March 31, 2012, but on or prior to March 31, 2013, and $100.00 per share if
redeemed after March 31, 2013, plus in each case unpaid and accumulated
dividends, if any, to the redemption date.
(c) The amount payable upon the shares of said forty-fifth series in
the event of voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be $100 per share plus an amount equivalent to the unpaid and
accumulated dividends thereon, if any, to the date of such voluntary or
involuntary dissolution, liquidation or winding up.
46. The $6.98 Cumulative Preferred Stock. 1,000,000 shares of the
------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-sixth series of Preferred Stock and are
designated as $6.98 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of Preferred Stock of the Company, the following distinctive terms and
characteristics:
19
(a) The forty-sixth series of Preferred Stock shall have a fixed
dividend rate of Six Dollars and Ninety-Eight Cents ($6.98) per share per annum.
Dividends on shares of the forty-sixty series of Preferred Stock shall be
cumulative from the date of issuance and shall be payable on the first days of
January, April, July and October in each year commencing July 1, 1993.
(b) Said forty-sixth series shall not be redeemable prior to July 1,
2003; and on and after that date the fixed redemption price on the shares of
such forty-sixth series shall be $100 per share plus unpaid and accumulated
dividends, if any, to the redemption date.
(c) The amount payable upon the shares of said forty-sixth series in
the event of voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be $100 per share plus an amount equivalent to the unpaid and
accumulated dividends thereon, if any, to the date of such voluntary or
involuntary dissolution, liquidation or winding up.
(d) The $6.98 Cumulative Preferred Stock shall be subject to
redemption as and for a sinking fund pursuant to which the Company will redeem
50,000 shares of the $6.98 Cumulative Preferred Stock, out of funds legally
available therefor, annually, on July 1, in each year commencing with the year
2003 and ending in the year 2007 and all the remaining outstanding shares of
$6.98 Cumulative Preferred Stock on July 1, 2008 (each such date being
hereinafter referred to as a "$6.98 Cumulative Preferred Stock Sinking Fund
Redemption Date"), at a price equal to $100 per share, plus an amount equal to
the unpaid and accumulated dividends on such share, if any, to the date of
redemption (the obligation of the Company so to redeem the shares of the $6.98
Cumulative Preferred Stock, being hereinafter referred to as the "$6.98
Cumulative Preferred Stock Sinking Fund Obligation"); the $6.98 Cumulative
Preferred Stock Sinking Fund Obligation during the specified period will be
cumulative; if on any $6.98 Cumulative Preferred Stock Sinking Fund Redemption
Date, the Company shall not have funds legally available therefor sufficient to
redeem the full number of shares required to be redeemed on that date, the $6.98
Cumulative Preferred Stock Sinking Fund Obligation with respect to the shares
not redeemed shall carry forward to each successive $6.98 Cumulative Preferred
Stock Sinking Fund Redemption Date and each successive July 1 thereafter until
such shares shall have been redeemed; whenever on any $6.98 Cumulative Preferred
Stock Sinking Fund Redemption Date, the funds of the Company legally available
for the satisfaction of the $6.98 Cumulative Preferred Stock Sinking Fund
Obligation and all other sinking fund, mandatory redemption and similar
obligations then existing with respect to any other class or series of its stock
ranking on a parity as to dividends or assets with the $6.98 Cumulative
Preferred Stock (such Obligation and obligations collectively being hereinafter
referred to as the "Total Sinking Fund Obligation") are insufficient to permit
the Company to satisfy fully its Total Sinking Fund Obligation on that date, the
Company shall apply to the satisfaction of its $6.98 Cumulative Preferred Stock
Sinking Fund Obligation on that date that proportion of such legally available
funds which is equal to the ratio of such $6.98 Cumulative Preferred Stock
Sinking Fund Obligation to such Total Sinking Fund Obligation; the Company may,
however, credit against the $6.98 Cumulative Preferred Stock Sinking Fund
Obligation for any year shares of the $6.98 Cumulative Preferred Stock
(including shares of the $6.98 Cumulative Preferred Stock optionally redeemed as
hereinbefore set forth) redeemed in any manner (other than shares of the $6.98
Cumulative Preferred Stock redeemed pursuant to the $6.98 Cumulative Preferred
Stock Sinking Fund Obligation), purchased or otherwise acquired, and not
previously credited against its $6.98 Cumulative Preferred Stock Sinking Fund
Obligation; notwithstanding the above, the Company shall in no event apply any
funds to the satisfaction of its $6.98 Cumulative Preferred Stock Sinking Fund
Obligation, on any $6.98
20
Cumulative Preferred Stock Sinking Fund Redemption Date, unless and until all
dividends accrued and payable on all then outstanding shares of the $6.98
Cumulative Preferred Stock and all other series of the Company's Preferred Stock
shall have been paid or funds shall have been set apart for their payment for
all past quarterly dividend periods ending on or before said $6.98 Cumulative
Preferred Stock Sinking Fund Redemption Date; the Company will have the option
on July 1, in each year, commencing with the year 2003, to redeem up to an
additional 50,000 shares of the $6.98 Cumulative Preferred Stock, at a price
equal to $100 per share plus an amount equal to the unpaid and accumulated
dividends on such share, if any, to the date of redemption; the Company's option
to redeem up to an additional 50,000 shares of the $6.98 Cumulative Preferred
Stock during the specified period shall be noncumulative.
47. The $7.50 Cumulative Preferred Stock. 392,233.50 shares of the
------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-seventh series of Preferred Stock and are
designated as $7.50 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of Preferred Stock of the Company, the following distinctive terms and
characteristics:
(a) The forty-seventh series of Preferred Stock shall have a fixed
dividend rate of Seven Dollars and Fifty Cents ($7.50) per share per annum; and
dividends on shares of the forty-seventh series of Preferred Stock shall be
cumulative from the date of issuance and shall be payable on the first days of
January, April, July and October in each year, commencing October 1, 1993;
(b) Said forty-seventh series shall not be redeemable prior to August
1, 2001; and on and after that date the fixed redemption price on the shares of
such forty-seventh series shall be $100 per share plus unpaid and accumulated
dividends, if any, to the redemption date;
(c) The amount payable upon the shares of said forty-seventh series
in the event of voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be $100 per share plus an amount equivalent to the unpaid
and accumulated dividends thereon, if any, to the date of such voluntary or
involuntary dissolution, liquidation or winding up.
48. The $6.375 Cumulative Preferred Stock. 1,000,000 shares of the
-------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-eighth series of Preferred Stock and are
designated as $6.375 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of Preferred Stock of the Company, the following distinctive terms and
characteristics:
(a) The forty-eighth series of Preferred Stock shall have a fixed
dividend rate of Six Dollars and Thirty-seven and One-half Cents ($6.375) per
share per annum. Dividends on shares of the forty-eighth series of Preferred
Stock shall be cumulative from the date of issuance and shall be payable on the
first days of January, April, July and October in each year commencing
January 1, 1994.
(b) Said forty-eighth series shall not be redeemable prior to October
1, 2003; and on and after that date the fixed redemption price on the shares of
such forty-eighth series shall be $100 per share plus unpaid and accumulated
dividends, if any, to the redemption date.
(c) The amount payable upon the shares of said forty-eighth series in
the event of voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be $100 per share plus an amount equivalent to the unpaid and
accumulated dividends thereon, if any, to the date
21
of such voluntary or involuntary dissolution, liquidation or winding up.
(d) The $6.375 Cumulative Preferred Stock shall be subject to
redemption as and for a sinking fund pursuant to which the Company will redeem
50,000 shares of the $6.375 Cumulative Preferred Stock, out of funds legally
available therefor, annually, on October 1, in each year commencing with the
year 2003 and ending in the year 2007 and all the remaining outstanding shares
of $6.375 Cumulative Preferred Stock on October 1, 2008 (each such date being
hereinafter referred to as a "$6.375 Cumulative Preferred Stock Sinking Fund
Redemption Date"), at a price equal to $100 per share, plus an amount equal to
the unpaid and accumulated dividends on such share, if any, to the date of
redemption (the obligation of the Company so to redeem the shares of the $6.375
Cumulative Preferred Stock being hereinafter referred to as the "$6.375
Cumulative Preferred Stock Sinking Fund Obligation"); the $6.375 Cumulative
Preferred Stock Sinking Fund Obligation during the specified period will be
cumulative; if on any $6.375 Cumulative Preferred Stock Sinking Fund Redemption
Date, the Company shall not have funds legally available therefor sufficient to
redeem the full number of shares required to be redeemed on that date, the
$6.375 Cumulative Preferred Stock Sinking Fund Obligation with respect to the
shares not redeemed shall carry forward to each successive $6.375 Cumulative
Preferred Stock Sinking Fund Redemption Date and each successive October 1
thereafter until such shares shall have been redeemed; whenever on any $6.375
Cumulative Preferred Stock Sinking Fund Redemption Date, the funds of the
Company legally available for the satisfaction of the $6.375 Cumulative
Preferred Stock Sinking Fund Obligation and all other sinking fund, mandatory
redemption and similar obligations then existing with respect to any other class
or series of its stock ranking on a parity as to dividends or assets with the
$6.375 Cumulative Preferred Stock (such Obligation and obligations collectively
being hereinafter referred to as the "Total Sinking Fund Obligation") are
insufficient to permit the Company to satisfy fully its Total Sinking Fund
Obligation on that date, the Company shall apply to the satisfaction of its
$6.375 Cumulative Preferred Stock Sinking Fund Obligation on that date that
proportion of such legally available funds which is equal to the ratio of such
$6.375 Cumulative Preferred Stock Sinking Fund Obligation to such Total Sinking
Fund Obligation; the Company may, however, credit against the $6.375 Cumulative
Preferred Stock Sinking Fund Obligation for any year shares of the $6.375
Cumulative Preferred Stock (including shares of the $6.375 Cumulative Preferred
Stock optionally redeemed as hereinbefore set forth) redeemed in any manner
(other than shares of the $6.375 Cumulative Preferred Stock redeemed pursuant to
the $6.375 Cumulative Preferred Stock Sinking Fund Obligation), purchased or
otherwise acquired, and not previously credited against its $6.375 Cumulative
Preferred Stock Sinking Fund Obligation; notwithstanding the above, the Company
shall in no event apply any funds to the satisfaction of its $6.375 Cumulative
Preferred Stock Sinking Fund Obligation, on any $6.375 Cumulative Preferred
Stock Sinking Fund Redemption Date, unless and until all dividends accrued and
payable on all then outstanding shares of the $6.375 Cumulative Preferred Stock
and all other series of the Company's Preferred Stock shall have been paid or
funds shall have been set apart for their payment for all past quarterly
dividend periods ending on or before said $6.375 Cumulative Preferred Stock
Sinking Fund Redemption Date.
49. The $7.22 Cumulative Preferred Stock. 301,132.50 shares of the
------------------------------------
authorized stock classified as Preferred Stock as provided in Division A of this
Article VI shall constitute the forty-ninth series of Preferred Stock and are
designated as $7.22 Cumulative Preferred Stock, which series shall have, in
addition to the general terms and characteristics of all the authorized shares
of
22
Preferred Stock of the Company, the following distinctive terms and
characteristics:
(a) The forty-ninth series of Preferred Stock shall have a fixed
dividend rate of Seven Dollars and Twenty-two Cents ($7.22) per share per annum;
and dividends on shares of the forty-ninth series of Preferred Stock shall be
cumulative from the date of issuance and shall be payable on the first days of
January, April, July and October in each year, commencing January 1, 1994;
(b) Said forty-ninth series shall not be redeemable prior to November
1, 2001; and on and after that date the fixed redemption price on the shares of
such forty-ninth series shall be $100 per share plus unpaid and accumulated
dividends, if any, to the redemption date;
(c) The amount payable upon the shares of said forty-ninth series in
the event of voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be $100 per share plus an amount equivalent to the unpaid and
accumulated dividends thereon, if any, to the date of such voluntary or
involuntary dissolution, liquidation or winding up.
Division C --- Common Stock
Subject to the rights expressly conferred upon the holders of
Preferred Stock, under prescribed conditions, by this Article VI, and
subordinate thereto, the holders of the Common Stock alone shall:
1. Receive all dividends declared by the Board of Directors;
provided, however, so long as any shares of the Preferred Stock are outstanding,
the Corporation shall not declare or pay any dividends on the Common Stock,
except as follows:
(a) If and so long as the Common Stock Equity at the end of the
calendar month immediately preceding the date on which a dividend
on Common Stock is declared is, or as a result of such dividend
would become, less than 20% of total capitalization, the
Corporation shall not declare such dividends in an amount which,
together with all other dividends on Common Stock declared within
the year ending with and including the date of such dividend
declaration, exceeds 75% of the net income of the Corporation
available for dividends on the Common Stock for the twelve full
calendar months immediately preceding the month in which such
dividends are declared.
For the purpose of this Section 1, (i) the term "Common Stock Equity"
shall mean the sum of the stated value of the outstanding Common Stock and the
retained earnings, including reservations thereof, and other paid-in capital of
the Corporation, whether or not available for the payment of dividends on the
Common Stock; (ii) the term "total capitalization" shall mean the sum of the
stated capital applicable to the outstanding stock of all classes of the
Corporation, the retained earnings, including reservations thereof, and other
paid-in capital of the Corporation, whether or not available for the payment of
dividends on the Common Stock of the Corporation, and the principal amount of
all outstanding debt of the Corporation (other than any obligation or liability
which, by its terms or otherwise, is non-recourse to the Corporation whether or
not such obligation or liability is reflected in the financial statements of the
Corporation) maturing more than twelve months after the date of the
determination of the total capitalization; and (iii) the term "dividends on
Common Stock" shall embrace dividends on Common Stock (other than dividends
payable only in shares of Common Stock), distributions on, and purchases or
other acquisitions for value of, any Common Stock of the
23
Corporation or other stock, if any, subordinate to the Preferred Stock.
2. Receive all assets of the Corporation available for distribution
to its shareholders in the event of any liquidation, dissolution, or winding up
of the Corporation. The Board of Directors, by vote of a majority of the
members thereof, may distribute in kind to the holders of the Common Stock such
remaining assets of the Corporation, or may sell, transfer or otherwise dispose
of all or any of the remaining property and assets of the Corporation to any
other corporation or other purchaser and receive payment therefor wholly or
partially in cash, property, stock or obligations of such purchaser, and may
sell all or any part of the consideration received therefor and distribute the
same or the proceeds thereof to the holders of the Common Stock.
3. Possess exclusively full voting power for the election of
directors and for all other purposes except as otherwise provided herein.
Division D --- Provisions Applicable to All Classes of Stock
1. Pre-emptive Rights. Upon any issue or sale for money or other
------------------
consideration of any stock of this Corporation that may be authorized from time
to time, no holder of stock irrespective of the kind of such stock shall have
any pre-emptive or other right to subscribe for, purchase or receive any
proportionate or other share of the stock so issued or sold (including treasury
shares), but the Board of Directors may dispose of all or any portion of such
stock as and when it may determine free of any such rights, whether by offering
the same to shareholders or by sale or other disposition as said Board may deem
advisable; provided, however, that if the Board of Directors shall determine to
offer any new or additional shares of Common Stock, or any security convertible
into Common Stock, for money, other than by a public offering of all of such
shares or an offering of all of such shares to or through underwriters or
investment bankers who shall have agreed promptly to make a public offering of
such shares, the same shall first be offered pro rata to the holders of the then
outstanding shares of Common Stock of the Corporation upon terms not less
favorable to the purchaser (without deduction of such reasonable compensation,
allowance or discount for the sale, underwriting or purchase as may be fixed
thereafter by the Board of Directors) than those on which the Board of Directors
issues and disposes of such stock or securities to other than such holders of
Common Stock; and provided further, that the time within which such pre-emptive
rights shall be exercised may be limited by the Board of Directors to such time
as the said Board may deem proper, not less, however, than twenty days after
mailing of notice that such stock rights are available and may be exercised.
The foregoing provisions of this paragraph shall not be changed unless the
holders of record of not less than two-thirds (2/3) of the number of shares of
Common Stock then outstanding shall consent thereto in writing or by voting
therefor in person or by proxy at the meeting of stockholders at which any such
change is considered.
2. Votes Per Share. Unless otherwise expressly provided in the
---------------
resolution of the Board of Directors of the Corporation establishing a series of
Preferred Stock, any shareholder of the Corporation having the right to vote at
any meeting of the shareholders or of any class or series thereof, as herein
provided, shall be entitled to one vote for each share of stock held by him.
There shall be no cumulative voting by any class, series, or shares of stock of
this Corporation.
24
3. Increase of Capital Stock. The capital stock of the Corporation
-------------------------
may be increased at any time, and from time to time, upon the vote of the
holders of record of not less than a majority of the aggregate number of shares
of the capital stock of the Corporation then outstanding and having power to
vote upon such increase.
ARTICLE VII
-----------
The Corporation from time to time, subject to the limitations or
requirements hereinabove provided and to the extent it may lawfully do so, may
purchase any of its stock outstanding at such price as may be authorized by its
Board of Directors and accepted by the holders of the stock purchased, and may
resell any stock so purchased or otherwise acquired by it at such price as may
be authorized by its said Board of Directors.
ARTICLE VIII
------------
Subject to the other provisions hereof, in order to acquire funds with
which to make any redemption or purchase of stock herein authorized, the
Corporation, subject to the limitations or requirements hereinabove provided and
to the extent it may lawfully do so, may issue and sell Common Stock or
Preferred Stock of any class then authorized but unissued, or bonds, notes, or
other evidences of indebtedness convertible or not into Common Stock or stock of
any other class then authorized but unissued.
ARTICLE IX
----------
The Corporation shall reimburse or indemnify any former, present or
future director, officer or employee of the Corporation, or any person who may
have served at its request as a director, officer or employee of another
corporation, or any former, present or future director, officer or employee of
the Corporation who shall have served or shall be serving as an administrator,
agent or fiduciary for the Corporation or for another corporation at the request
of the Corporation (and his heirs, executors and administrators) from and
against all expenses and liabilities incurred by him or them, or imposed on him
or them, including, but not limited to, judgments, settlements, court costs and
attorneys' fees, in connection with, or arising out of, the defense of any
action, suit or proceeding in which he may be involved by reason of his being or
having been such director, officer or employee, except with respect to matters
as to which he shall be adjudged in such action, suit or proceeding to be liable
because he did not act in good faith, or because of dishonesty or conflict of
interest in the performance of his duty.
No former, present or future director, officer or employee of the
Corporation (or his heirs, executors and administrators) shall be liable for any
act, omission, step or conduct taken or had in good faith, which is required,
authorized or approved by any order or orders issued pursuant to the Public
Utility Holding Company Act of 1935, the Federal Power Act, or any other federal
or state statute regulating the Corporation or its subsidiaries, or any
amendments to any thereof. In any action, suit or proceeding based on any act,
omission, step or conduct, as in this paragraph described, the provisions hereof
shall be brought to the attention of the court. In the event that the foregoing
provisions of this paragraph are found by the court not to constitute a valid
defense, each such
25
director, officer or employee (and his heirs, executors and administrators)
shall be reimbursed for, or indemnified against, all expenses and liabilities
incurred by him or them, or imposed on him or them, including, but not limited
to, judgments, settlements, court costs and attorneys' fees, in connection with,
or arising out of, any such action, suit or proceeding based on any act,
omission, step or conduct taken or had in good faith as in this paragraph
described.
The foregoing rights shall not be exclusive of other rights to which
any such director, officer or employee (or his heirs, executors and
administrators) may otherwise be entitled under any bylaw, agreement, vote of
shareholders or otherwise, and shall be available whether or not the director,
officer or employee continues to be a director, officer or employee at the time
of incurring such expenses and liabilities. In furtherance, and not in
limitation of the foregoing provisions of this Article IX, the Corporation may
indemnify and insure any such persons to the fullest extent permitted by the
Texas Business Corporation Act, as amended from time to time, or the laws of the
State of Texas, as in effect from time to time.
ARTICLE X
---------
A director of the Corporation shall not be liable to the Corporation
or its shareholders for monetary damages for any act or omission in the
director's capacity as a director, except that this provision does not eliminate
or limit liability of a director for:
(a) a breach of a director's duty of loyalty to the Corporation or
its shareholders;
(b) an act or omission not in good faith that constitutes a breach of
duty of a director to the Corporation or an act or omission that
involved intentional misconduct or a knowing violation of the law;
(c) a transaction from which a director received an improper benefit,
whether or not the benefit resulted from an action taken within the
scope of the director's office; or
(d) an act or omission for which the liability of a director is
expressly provided for by statute.
If the laws of the State of Texas are amended to authorize action
further eliminating or limiting the personal liability of directors, then the
liability of a director of the Corporation shall be eliminated or limited to the
fullest extent permitted by such laws as so amended. Any repeal or modification
of this Article X shall not adversely affect any right of protection of a
director of the Corporation existing at the time of such repeal or modification.
ARTICLE XI
----------
The power to alter, amend or repeal the Bylaws of the Corporation, or
to adopt new Bylaws, is hereby delegated to the Board of Directors subject to
repeal or change by action of the shareholders.
ARTICLE XII
-----------
The Corporation has heretofore complied with the requirements of law
as to the initial minimum capital requirements without which it could not
commence business under the Texas Business Corporation Act.
26