Exhibit 1(a)
Texas Utilities Company
$
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% Debt Securities due
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UNDERWRITING AGREEMENT
,
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[Name and Address]
as Representatives of the Underwriters
named in Schedule II hereto
(the "Representative")
c/o Name Address
Ladies and Gentlemen:
1. Introduction. Texas Utilities Company, a Texas
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corporation (the "Company"), proposes to issue and sell
severally to the underwriters named in Schedule II hereto (the
"Underwriters") $ principal amount of its % Debt
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Securities due (the "Securities"), subject to the
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terms and conditions set forth herein. The Securities are to be
issued pursuant to the provisions of an Indenture (For Unsecured
Debt Securities Series ), dated as of , 1998,
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between the Company and The Bank of New York, as trustee (the
"Indenture Trustee"), said Indenture, together with any
amendments or supplements thereto, being hereinafter referred to
as the "Indenture".
2. Representations and Warranties of the Company.
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The Company represents and warrants to the several Underwriters
that:
(a) It has filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of
1933, as amended (the "Securities Act"), a registration
statement on Form S-3, including a prospectus, on ,
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1998 (Registration Nos. 333- and 333- -
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01), for the registration of $400,000,000 aggregate amount
of (i) the Company's unsecured debt securities and (ii) the
preferred trust securities of the Company's financing
subsidiary TXU Capital I, a Delaware business trust, an
equal principal amount of the Company's junior subordinated
debentures and guarantees and other obligations of the
Company in respect of the preferred trust securities. Such
registration statement, was declared effective by the
Commission on , 1998. References herein to the
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term "Registration Statement" as of any date shall be deemed
to refer to Registration Statement Nos. 333- and
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333- -01, as amended or supplemented as of such
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date, including all documents incorporated by reference
therein as of such date pursuant to Item 12 of Form S-3
("Incorporated Documents"); provided that if the Company
files a registration statement with the Commission pursuant
to Section 462(b) of the Securities Act (the "Rule 462(b)
Registration Statement"), then after such filing, all
references to "Registration Statement" shall be deemed
to include the Rule 462(b) Registration Statement.
References herein to the term "Prospectus" as of any given
date shall be deemed to refer to the prospectus, including
any preliminary prospectus, forming a part of Registration
Statement Nos. 333- and 333- -01, as
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amended or supplemented as of such date, including all
Incorporated Documents as of such date and including any
prospectus supplement relating to the Securities.
References herein to the term "Effective Date" shall be
deemed to refer to the later of the time and date
Registration Statement Nos. 333- and 333- -01,
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any post-effective amendment to Registration Statement Nos.
333- and 333- -01, or any Rule 462(b)
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Registration Statement was declared effective or the time
and date of the filing thereafter of the Company's most
recent Annual Report on Form 10-K if such filing is made
prior to the Closing Date, as hereinafter defined. The
Company will not file any amendment to the Registration
Statement or supplement to the Prospectus on or after the
date of this Agreement and prior to the Closing Date, as
hereinafter defined, without prior notice to the
Underwriters, or to which Counsel for the Underwriters shall
reasonably object in writing. For the purposes of this
Agreement, any Incorporated Document filed with the
Commission on or after the date of this Agreement and prior
to the Closing Date, as hereinafter defined, shall be deemed
an amendment or supplement to the Registration Statement and
the Prospectus.
(b) On the Effective Date, the Registration Statement
and the prospectus included as part of the Registration
Statement fully complied and at the Closing Date, as
hereinafter defined, the Registration Statement, the
Prospectus and the Indenture will fully comply in all
material respects with the applicable provisions of the
Securities Act, the Trust Indenture Act of 1939, as amended
("Trust Indenture Act"), and the applicable rules and regu-
lations of the Commission thereunder; on the Effective Date
the Registration Statement did not, and at the Closing Date,
as hereinafter defined, the Registration Statement will not,
contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading; on
the Effective Date the Prospectus did not, and at the
Closing Date, as hereinafter defined, and on the date it is
filed with the Commission pursuant to Rule 424 of the
General Rules and Regulations of the Securities Act ("Rule
424"), the Prospectus will not, contain an untrue statement
of a material fact or omit to state a material fact neces-
sary in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading; and on said dates the Incorporated Documents,
taken together as a whole, fully complied or will comply in
all material respects with the applicable provisions of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the applicable rules and regulations of the
Commission thereunder, and, when read together with the
Prospectus on said dates, did not and will not contain an
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided that the foregoing representations and warranties
in this paragraph (b) shall not apply to statements or
omissions made in reliance upon information furnished in
writing to the Company by, or on behalf of, any Underwriter
through the Representatives for use in connection with the
preparation of the Registration Statement or the Prospectus
or to any statements in or omissions from the Statements of
Eligibility and Qualification under the Trust Indenture Act,
or amendments thereto, filed as exhibits to the Registration
Statement.
(c) The consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will
not result in a breach of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed
of trust, charter, by-laws or other agreement or instrument
to which the Company is now a party.
(d) Each direct and indirect material subsidiary of
the Company has been incorporated and is validly existing as
a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power
and authority to own, lease and operate its properties and
to conduct its business as currently conducted and as set
forth in or contemplated by the Prospectus, and is qualified
as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the
failure to so qualify or be in good standing would not have
a material adverse effect on the business, property or
financial condition of the Company and its subsidiaries,
considered as a whole. Except as otherwise set forth in or
contemplated by the Registration Statement and the
Prospectus, all of the issued and outstanding shares of
capital stock of direct and indirect material subsidiaries
of the Company have been authorized and validly issued, are
fully paid and non-assessable and (except for any directors'
qualifying shares) are owned by the Company, directly or
through its subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or
equity other than those ordinary shares of TU Finance (No.
2) Limited, TU Acquisitions PLC, The Energy Group Limited
and Energy Holdings (No. 3) Limited (formerly known as The
Energy Group PLC) ("Energy Holdings") which have been
pledged as collateral for borrowings made by subsidiaries.
None of the outstanding shares of capital stock of such
material subsidiaries was issued in violation of preemptive
or other similar rights arising by operation of law, under
the charter or by-laws of any subsidiary or under any
agreement to which the Company or any subsidiary is a party.
3. Purchase and Sale. On the basis of the
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representations and warranties herein contained, and subject to
the terms and conditions herein set forth, the Company shall sell
to each of the Underwriters, and each of the Underwriters shall
purchase from the Company, at the time and place herein
specified, severally and not jointly, the principal amount of
Securities set forth opposite the name of such Underwriter in
Schedule II hereto, at the purchase price set forth in Schedule I
hereto.
4. Time and Place of Closing. Delivery of the
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Securities against payment therefor by wire transfer in federal
funds by the Underwriters or on their behalf shall be made at the
office of Thelen Reid & Priest LLP, 40 West 57th Street, New
York, New York, at 10:00 A.M., New York Time, on ,
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or at such other place, time and date as shall be agreed upon in
writing by the Company and you or established in accordance with
the following paragraph. The hour and date of such delivery and
payment are herein called the "Closing Date". The Securities
shall be delivered to The Depository Trust Company or to The Bank
of New York, as custodian for The Depository Trust Company, in
fully registered global form registered in the name of CEDE &
Co., for the respective accounts specified by you not later than
the close of business on the business day prior to the Closing
Date or such other date and time not later than the Closing Date
as agreed by The Depository Trust Company or The Bank of New
York. The Company agrees to make the Securities available to you
for checking purposes not later than 10:00 A.M., New York Time,
on the last business day preceding the Closing Date at the office
of Thelen Reid & Priest LLP, 40 West 57th Street, New York, New
York, 10019, or at such other place as the Company may specify.
If any Underwriter shall fail or refuse (otherwise than
for some reason sufficient to justify, in accordance with the
terms hereof, the cancellation or termination of its obligations
hereunder) to purchase and pay for the aggregate principal amount
of the Securities that such Underwriter has agreed to purchase
and pay for hereunder, the Company shall immediately give notice
to the other Underwriters of the default of such Underwriter, and
the other Underwriters shall have the right within 24 hours after
the receipt of such notice to determine to purchase, or to
procure one or more others, who are members of the National
Association of Securities Dealers, Inc. ("NASD") (or, if not
members of the NASD, who are not eligible for membership in the
NASD and who agree (i) to make no sales within the United States,
its territories or its possessions or to persons who are citizens
thereof or residents therein and (ii) in making sales to comply
with the NASD's Conduct Rules) and satisfactory to the Company,
to purchase, upon the terms herein set forth, the aggregate
principal amount of the Securities that the defaulting
Underwriter had agreed to purchase. If any non-defaulting
Underwriter or Underwriters shall determine to exercise such
right, such Underwriter or Underwriters shall give written notice
to the Company of the determination in that regard within 24
hours after receipt of notice of any such default, and thereupon
the Closing Date shall be postponed for such period, not
exceeding three business days, as the Company shall determine.
If in the event of such a default no non-defaulting Underwriter
shall give such notice, then this Agreement may be terminated by
the Company, upon like notice given to the non-defaulting
Underwriters, within a further period of 24 hours. If in such
case the Company shall not elect to terminate this Agreement it
shall have the right, irrespective of such default:
(a) to require each non-defaulting Underwriter to
purchase and pay for the aggregate principal amount of the
Securities that it had agreed to purchase hereunder as
provided and, in addition, the principal amount of the
Securities that the defaulting Underwriter shall have so
failed to purchase up to a principal amount thereof equal to
one-ninth (1/9) of the principal amount of Securities that
such non-defaulting Underwriter has otherwise agreed to
purchase hereunder, and/or
(b) to procure one or more persons, reasonably
acceptable to the Representatives, who are members of the
NASD (or, if not members of the NASD, who are not eligible
for membership in the NASD and who agree (i) to make no
sales within the United States, its territories or its
possessions or to persons who are citizens thereof or
residents therein and (ii) in making sales to comply with
the NASD's Rules of Fair Practice), to purchase, upon the
terms herein set forth, either all or a part of the
principal amount of the Securities that such defaulting
Underwriter had agreed to purchase or that portion thereof
that the remaining Underwriters shall not be obligated to
purchase pursuant to the foregoing clause (a).
In the event the Company shall exercise its rights under (a)
and/or (b) above, the Company shall give written notice thereof
to the non-defaulting Underwriters within such further period of
24 hours, and thereupon the Closing Date shall be postponed for
such period, not exceeding three business days, as the Company
shall determine.
In the computation of any period of 24 hours referred
to in this Section 4, there shall be excluded a period of 24
hours in respect of each Saturday, Sunday or legal holiday that
would otherwise be included in such period of time.
Any action taken by the Company under this Section 4
shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
Termination by the Company under this Section 4 shall be without
any liability on the part of the Company or any non-defaulting
Underwriter, except as otherwise provided in Sections 5(g) and 8
hereof.
5. Covenants of the Company. The Company agrees
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that:
(a) It will promptly deliver to you a signed copy of
the Registration Statement as originally filed or, to the
extent a signed copy is not available, a conformed copy,
certified by an officer of the Company to be in the form as
originally filed, including all Incorporated Documents and
exhibits and of all amendments thereto.
(b) It will deliver to you, as soon as practicable
after the date hereof, as many copies of the Prospectus as
of such date as you may reasonably request.
(c) It will cause the Prospectus to be filed with the
Commission pursuant to Rule 424 as soon as practicable and
advise you of the issuance of any stop order under the
Securities Act with respect to the Registration Statement or
the institution of any proceedings therefor of which the
Company shall have received notice. The Company will use
its best efforts to prevent the issuance of any such stop
order and to secure the prompt removal thereof if issued.
(d) If, during such period of time (not exceeding nine
months) after the Prospectus has been filed with the
Commission pursuant to Rule 424 as in the opinion of Counsel
for the Underwriters a prospectus covering the Securities is
required by law to be delivered in connection with sales by
an Underwriter or a dealer, any event relating to or
affecting the Company or of which the Company shall be
advised in writing by you shall occur that in the Company's
reasonable opinion after consultation with Counsel for the
Underwriters should be set forth in a supplement to, or an
amendment of, the Prospectus in order to make the Prospectus
not misleading in the light of the circumstances when it is
delivered to a purchaser, the Company will, at its expense,
amend or supplement the Prospectus by either (i) preparing
and furnishing to you at the Company's expense a reasonable
number of copies of a supplement or supplements or an
amendment or amendments to the Prospectus or (ii) making an
appropriate filing pursuant to Section 13 of the Exchange
Act, which will supplement or amend the Prospectus so that,
as supplemented or amended, it will not contain any untrue
statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in
the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading; provided that
should such event relate solely to the activities of any of
the Underwriters, then the Underwriters shall assume the
expense of preparing and furnishing any such amendment or
supplement. In case any Underwriter is required to deliver
a prospectus after the expiration of nine months from the
date the Prospectus is filed with the Commission pursuant to
Rule 424, the Company, upon your request, will furnish to
you, at your expense, a reasonable quantity of a
supplemental prospectus or supplements to the Prospectus
complying with Section 10(a) of the Securities Act.
(e) It will make generally available to its security
holders, as soon as practicable, an earnings statement
(which need not be audited) covering a period of at least
twelve months beginning not earlier than the first day of
the month next succeeding the month in which occurred the
effective date of the Registration Statement as defined in
Rule 158 under the Securities Act.
(f) It will furnish such proper information as may be
lawfully required and otherwise cooperate in qualifying the
Securities for offer and sale under the blue-sky laws of
such jurisdictions as you may designate, provided that the
Company shall not be required to qualify as a foreign
corporation or dealer in securities, to file any consents to
service of process under the laws of any jurisdiction, or to
meet any other requirements deemed by the Company to be
unduly burdensome.
(g) It will, except as herein provided, pay all fees,
expenses and taxes (except transfer taxes) in connection
with (i) the preparation and any filing by it of the
Prospectus or any amendments to the Registration Statement,
(ii) the issuance and delivery of the Securities as provided
in Section 4 hereof, (iii) the qualification of the
Securities under blue-sky laws (including counsel fees not
to exceed $7,500) and (iv) the printing and delivery to the
Underwriters of reasonable quantities of the Registration
Statement and the Prospectus and, except as provided in
Section 5(d) hereof, of any amendments or supplements
thereto. The Company shall not, however, be required to pay
any amount for any expenses of the Underwriters, except
that, if this Agreement shall be terminated in accordance
with the provisions of Section 6, 7 or 9 hereof, the Company
will reimburse the Underwriters for the fees and
disbursements of Counsel for the Underwriters, whose fees
and disbursements the Underwriters agree to pay in any other
event, and will reimburse the Underwriters for their
reasonable out-of-pocket expenses, in an aggregate amount
not exceeding $5,000, incurred in contemplation of the
performance of this Agreement. The Company shall not in any
event be liable to the Underwriters for damages on account
of loss of anticipated profits.
(h) During the period beginning on the date hereof and
continuing to and including the Closing Date, it will not
offer, sell, contract to sell or otherwise transfer or
dispose of any debt securities of the Company or any
warrants, rights or options to purchase or otherwise acquire
debt securities of the Company substantially similar to the
Securities (other than (i) the Securities and (ii)
commercial paper issued in the ordinary course of business),
without the prior written consent of the Representatives.
6. Conditions of Underwriters' Obligations. The
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obligations of the Underwriters to purchase and pay for the
Securities shall be subject to the accuracy of the
representations and warranties made herein on the part of the
Company, to the performance by the Company of its obligations to
be performed hereunder prior to the Closing Date, and to the
following conditions:
(a) The Prospectus shall have been filed with the
Commission pursuant to Rule 424 prior to 5:30 P.M., New York
Time, on the second business day after the date of this
Agreement, or such other time and date as may be approved by
you.
(b) No stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no
proceedings for that purpose shall be pending before, or
threatened by, the Commission on the Closing Date; and you
shall have received a certificate, dated the Closing Date
and signed by an officer of the Company, to the effect that
no such stop order is in effect and that no proceedings for
such purpose are pending before, or to the knowledge of the
Company threatened by, the Commission.
(c) On the Closing Date, you shall have received from
Worsham, Forsythe & Wooldridge, L.L.P., General Counsel for
the Company, Thelen Reid & Priest LLP, of counsel for the
Company, and Winthrop, Stimson, Putnam & Roberts, Counsel
for the Underwriters, opinions in substantially the form and
substance prescribed in Schedules III, IV and V hereto (A)
with such changes therein as may be agreed upon by the
Company and you, with the approval of Counsel for the
Underwriters, and (B) if the Prospectus relating to the
Securities shall be supplemented or amended after the
Prospectus shall have been filed with the Commission
pursuant to Rule 424, with any changes therein necessary to
reflect such supplementation or amendment.
(d) On and as of the date hereof and on and as of the
Closing Date you shall have received from Deloitte & Touche
LLP a letter to the effect that (i) they are independent
certified public accountants with respect to the Company,
within the meaning of the Securities Act and the related
rules and regulations adopted by the Commission thereunder,
(ii) in their opinion, the financial statements audited by
them and included or incorporated by reference in the
Prospectus comply as to form, in all material respects, with
the applicable accounting requirements of the Exchange Act
and the related rules and regulations adopted by the
Commission thereunder, (iii) on the basis of a reading of
the unaudited amounts of operating revenues and net income
included or incorporated by reference in the Prospectus and
the related financial statements from which these amounts
were derived, the latest available unaudited financial
statements of the Company and the minute books of the
Company and inquiries of officers of the Company who have
responsibility for financial and accounting matters (it
being understood that the foregoing procedures do not
constitute an audit made in accordance with generally
accepted auditing standards and would not necessarily reveal
matters of significance with respect to the comments made in
such letter, and accordingly that Deloitte & Touche LLP
makes no representation as to the sufficiency of such
procedures for the Underwriters' purposes), nothing has come
to their attention that caused them to believe that (A) any
material modifications should be made to the unaudited
condensed consolidated financial statements incorporated by
reference in the Prospectus, for them to be in conformity
with generally accepted accounting principles, (B) the un-
audited condensed consolidated financial statements
incorporated by reference in the Prospectus did not comply
as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the related
rules and regulations thereunder adopted by the Commission,
(C) for the twelve months ended December 31, 1998, if
available, there were any decreases in operating revenues or
net income as compared with the comparable period of the
preceding year, and (D) at a specified date not more than
seven days prior to the date of such letter, there was any
change in the capital stock of the Company, short-term bank
loans, commercial paper, notes payable or long-term debt of
the Company or decrease in its net assets, in each case as
compared with amounts shown in the most recent balance sheet
incorporated by reference in the Prospectus, except in all
instances for changes or decreases that the Prospectus
discloses have occurred or may occur or which are occasioned
by the declaration of a regular quarterly dividend or the
acquisition of long-term debt for sinking fund purposes, or
that are described in such letter, (iv) on the basis of a
reading of the unaudited condensed consolidated pro forma
balance sheet as of March 31, 1998, the unaudited condensed
consolidated pro forma statements of income for the twelve
months ended December 31, 1997, and the three months ended
March 31, 1998, included or incorporated by reference in the
Prospectus, and inquiries of certain officers of the Company
and Energy Holdings who have responsibility for financial
and accounting matters (it being understood that the
foregoing procedures are substantially less in scope than an
examination, the objective of which is the expression of an
opinion on management's assumptions, the pro forma
adjustments, and the application of those adjustments to
historical financial information and would not necessarily
reveal matters of significance with respect to the comments
made in such letter, and accordingly that Deloitte & Touche
LLP makes no representation as to the sufficiency of such
procedures for the Underwriters' purposes), nothing came to
their attention that caused them to believe that the
unaudited pro forma condensed consolidated financial
statements referred to above incorporated by reference in
the Prospectus did not comply as to form in all material
respects with the applicable accounting requirements of Rule
11-02 of Regulation S-X and that the pro forma adjustments
had not been properly applied to the historical amounts in
the compilation of those statements, and (v) they have
compared the dollar amounts (or percentages or ratios
derived from such dollar amounts) and other financial
information included or incorporated by reference in the
Registration Statement and the Prospectus as reasonably
requested by you (in each case to the extent that such
dollar amounts, percentages and other financial information
are derived from the general accounting records of the
Company and its consolidated subsidiaries subject to the
internal controls of the Company's accounting system or are
derived indirectly from such records by analysis or
computation) with the results obtained from inquiries, a
reading of such general accounting records and other
procedures specified in such letter, and have found such
dollar amounts, percentages and other financial information
to be in agreement with such results, except as otherwise
specified in such letter.
(e) On and as of the Closing Date you shall have
received from Ernst & Young a letter in form and substance
reasonably satisfactory to counsel to the Underwriters (i)
to the effect that they are independent auditors with
respect to Energy Holdings, within the meaning of the
Securities Act and the related rules and regulations adopted
by the Commission thereunder and (ii) with respect to the
financial information concerning Energy Holdings
incorporated by reference in the Prospectus.
(f) Since the most recent dates as of which in-
formation is given in the Registration Statement or the
Prospectus, there shall not have been any material adverse
change in the business, property or financial condition of
the Company and its subsidiaries, considered as a whole,
whether or not in the ordinary course of business, and,
since such dates, there shall not have been any material
transaction entered into by the Company, other than transac-
tions in the ordinary course of business and transactions
contemplated by the Registration Statement or Prospectus,
and at the Closing Date you shall have received a
certificate to such effect dated the Closing Date and signed
by an officer of the Company.
(g) All legal proceedings to be taken in connection
with the issuance and sale of the Securities shall have been
satisfactory in form and substance to Counsel for the
Underwriters.
In case any of the conditions specified above in this
Section 6 shall not have been fulfilled when and as required to
be fulfilled, this Agreement may be terminated by the
Representatives upon notice thereof to the Company. Any such
termination shall be without liability of any party to any other
party except as otherwise provided in Sections 5(g) and 8 hereof.
7. Conditions of Company's Obligations. The
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obligation of the Company to deliver the Securities shall be
subject to the conditions that the Prospectus shall have been
filed with the Commission pursuant to Rule 424 prior to 5:30
P.M., New York Time, on the second business day after the date of
this Agreement or such other time and date as may be approved by
the Company, and no stop order suspending the effectiveness of
the Registration Statement shall be in effect at the Closing Date
and no proceedings for that purpose shall be pending before, or
threatened by, the Commission at the Closing Date. In case these
conditions shall not have been fulfilled, this Agreement may be
terminated by the Company upon notice thereof to you. Any such
termination shall be without liability of any party to any other
party except as otherwise provided in Sections 5(g) and 8 hereof.
8. Indemnification.
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(a) The Company shall indemnify, defend and hold
harmless each Underwriter and each person who controls any
Underwriter within the meaning of Section 15 of the
Securities Act from and against any and all losses, claims,
damages or liabilities, joint or several, to which they or
any of them may become subject under the Securities Act or
any other statute or common law and shall reimburse each
such Underwriter and controlling person for any legal or
other expenses (including, to the extent hereinafter
provided, reasonable counsel fees) incurred by them in
connection with investigating any such losses, claims,
damages or liabilities or in connection with defending any
actions, insofar as such losses, claims, damages,
liabilities, expenses or actions arise out of or are based
upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the
Prospectus, or the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein in the light of the
circumstances under which they were made not misleading;
provided, however, that the indemnity agreement contained in
this Section 8 shall not apply to any such losses, claims,
damages, liabilities, expenses or actions arising out of, or
based upon, any such untrue statement or alleged untrue
statement, or any such omission or alleged omission, if such
statement or omission was made in reliance upon and in
conformity with information furnished in writing to the
Company by or on behalf of any Underwriter, through the
Representatives or Counsel for the Underwriters, expressly
for use in the Registration Statement or the Prospectus or
any amendment or supplement to either thereof, or arising
out of, or based upon, statements in or omissions from that
part of the Registration Statement that shall constitute the
Statements of Eligibility and Qualification under the Trust
Indenture Act of any trustee with respect to any indenture
qualified pursuant to the Registration Statement; and
provided further, that the indemnity agreement contained in
this Section 8 shall not inure to the benefit of any
Underwriter (or of any person controlling such Underwriter)
on account of any such losses, claims, damages, liabilities,
expenses or actions arising from the sale of the Securities
to any person if a copy of the Prospectus (exclusive of the
Incorporated Documents) shall not have been given or sent to
such person by or on behalf of such Underwriter with or
prior to the written confirmation of the sale involved
unless the alleged omission or alleged untrue statement was
not corrected in the Prospectus at the time of such written
confirmation. The indemnity agreement of the Company
contained in this Section 8 and the representations and
warranties of the Company contained in Section 2 hereof
shall remain operative and in full force and effect
regardless of any termination of this Agreement or of any
investigation made by or on behalf of any Underwriter or any
such controlling person, and shall survive the delivery of
the Securities.
(b) Each Underwriter shall indemnify, defend and hold
harmless the Company, its officers and directors, and each
person who controls the Company within the meaning of
Section 15 of the Securities Act, from and against any and
all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject
under the Securities Act or any other statute or common law
and shall reimburse each of them for any legal or other
expenses (including, to the extent hereinafter provided,
reasonable counsel fees) incurred by them in connection with
investigating any such losses, claims, damages or
liabilities or in connection with defending any actions,
insofar as such losses, claims, damages, liabilities,
expenses or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or the
Prospectus, or the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, if
such statement or omission was made in reliance upon and in
conformity with information furnished in writing to the
Company by or on behalf of any Underwriter, through the
Representatives or Counsel for the Underwriters, for use in
connection with the preparation of the Registration
Statement or the Prospectus or any amendment or supplement
to either thereof. Each Underwriter hereby furnishes to the
Company in writing expressly for use in the Prospectus
. The indemnity agreement of
----------------------------
the respective Underwriters contained in this Section 8
shall remain operative and in full force and effect
regardless of any termination of this Agreement or of any
investigation made by or on behalf of the Company, its
directors or its officers, any such Underwriter, or any such
controlling person, and shall survive the delivery of the
Securities.
(c) The Company and the several Underwriters each
shall, upon the receipt of notice of the commencement of any
action against it or any person controlling it as aforesaid,
in respect of which indemnity may be sought on account of
any indemnity agreement contained herein, promptly give
written notice of the commencement thereof to the party or
parties against whom indemnity shall be sought hereunder,
but the failure so to notify such indemnifying party or
parties of any such action shall not relieve such
indemnifying party or parties from any liability hereunder
to the extent it is not materially prejudiced as a result of
such failure to notify and in any event shall not relieve it
from any liability that it or they may have to the
indemnified party otherwise than on account of such
indemnity agreement. In case such notice of any such action
shall be so given, such indemnifying party shall be entitled
to participate at its own expense in the defense, or, if it
so elects, to assume (in conjunction with any other
indemnifying parties) the defense of such action, in which
event such defense shall be conducted by counsel chosen by
such indemnifying party or parties and satisfactory to the
indemnified party or parties who shall be defendant or
defendants in such action, and such defendant or defendants
shall bear the fees and expenses of any additional counsel
retained by them; but if the indemnifying party shall elect
not to assume the defense of such action, such indemnifying
party will reimburse such indemnified party or parties for
the reasonable fees and expenses of any counsel retained by
them; provided, however, if the defendants in any such
action (including impleaded parties) include both the
indemnified party and the indemnifying party and counsel for
the indemnifying party shall have reasonably concluded that
there may be a conflict of interest involved in the
representation by a single counsel of both the indemnifying
party and the indemnified party, the indemnified party or
parties shall have the right to select separate counsel,
satisfactory to the indemnifying party (it being understood,
however, that the indemnifying party shall not be liable for
the expenses of more than one separate counsel (in addition
to local counsel) representing the indemnified parties who
are parties to such action). Each of the Company and the
Underwriters agrees that without the other party's prior
written consent, which consent shall not be unreasonably
withheld, it will not settle, compromise or consent to the
entry of any judgment in any claim in respect of which
indemnification may be sought under the indemnification
provision of this Agreement, unless such settlement,
compromise or consent (i) includes an unconditional release
of such other party from all liability arising out of such
claim and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on
behalf of such other party.
(d) If the indemnification provided for in sub-
paragraph (a) or (b) above shall be unenforceable under
applicable law by an indemnified party, each indemnifying
party agrees to contribute to such indemnified party with
respect to any and all losses, claims, damages, liabilities
and expenses for which each such indemnification provided
for in subparagraph (a) or (b) above shall be unenforceable,
in such proportion as shall be appropriate to reflect (i)
the relative fault of each indemnifying party on the one
hand and the indemnified party on the other in connection
with the statements or omissions that have resulted in such
losses, claims, damages, liabilities and expenses, (ii) the
relative benefits received by the Company on the one hand
and the Underwriters on the other hand from the offering of
the Securities pursuant to this Agreement, and (iii) any
other relevant equitable considerations; provided, however,
that no indemnified party guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from
any indemnifying party not guilty of such fraudulent
misrepresentation. Relative fault shall be determined by
reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to
information supplied by such indemnifying party or the
indemnified party and each such party's relative intent,
knowledge, access to information and opportunity to correct
or prevent such untrue statement or omission. The Company
and each of the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subparagraph
(d) were to be determined by pro rata allocation or by any
other method of allocation that does not take account of the
equitable considerations referred to above. Notwithstanding
the provisions of this Section 8, no Underwriter shall be
required to contribute in excess of the amount equal to the
excess of (i) the total price at which the Securities were
offered to the public, over (ii) the amount of any damages
which the Underwriter has otherwise been required to pay by
reason of any such untrue or alleged untrue statement or
omission or alleged omission. The obligations of each
Underwriter to contribute pursuant to this Section 8 are
several and not joint and shall be in the same proportion of
all contributions of Underwriters required hereunder as such
Underwriter's obligation to underwrite Securities is of the
total amount of Securities set forth in Schedule I hereto.
9. Termination. This Agreement may be terminated, at
-----------
any time prior to the Closing Date, by the Representatives if
(a) after the date hereof and at or prior to the Closing Date
there shall have occurred any suspension or material limitation
of trading of any of the Company's securities on the New York
Stock Exchange, Inc. ("NYSE") or any general suspension of
trading in securities on the NYSE, the American Stock Exchange,
Inc. ("AMEX") or the NASDAQ Stock Market, Inc. ("NASDAQ") or
there shall have been established by the NYSE, AMEX or NASDAQ or
by the Commission or by any federal or state agency or by the
decision of any court, any general limitation on prices for such
trading or any general restrictions on the distribution of
securities, or a general banking moratorium declared by New York
or federal authorities, or (b) there shall have occurred any (i)
new material outbreak of hostilities or (ii) new material other
national or international calamity or crisis, including, but not
limited to, an escalation of hostilities that existed prior to
the date of this Agreement or (iii) material adverse change in
the financial markets in the United States, and the effect of any
such event specified in clause (a) or (b) above on the financial
markets of the United States shall be such as to make it
impracticable, in the reasonable judgment of the Representatives,
for the Underwriters to enforce contracts for the sale of the
Securities. This Agreement may also be terminated at any time
prior to the Closing Date by the Representatives if, in their
reasonable judgment, the subject matter of any amendment or
supplement to the Registration Statement or the Prospectus (other
than an amendment or supplement relating solely to the activity
of any Underwriter or Underwriters) prepared and issued by the
Company after the effectiveness of this Agreement shall have
disclosed a material adverse change in the business, property or
financial condition of the Company and its subsidiaries,
considered as a whole, whether or not in the ordinary course of
business, that has materially impaired the marketability of the
Securities. Any termination hereof pursuant to this Section 9
shall be without liability of any party to any other party except
as otherwise provided in Sections 5(g) and 8 hereof.
10. Miscellaneous. THE VALIDITY AND INTERPRETATION OF
-------------
THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK. This Agreement shall inure to the benefit of the Company,
the several Underwriters and, with respect to the provisions of
Section 8 hereof, each director, officer and controlling person
referred to in said Section 8, and their respective successors.
Nothing herein is intended or shall be construed to give to any
other person, firm or corporation any legal or equitable right,
remedy or claim under or in respect of any provision in this
Agreement. The term "successor" as used herein shall not include
any purchaser, as such purchaser, of any of the Securities from
any of the several Underwriters.
11. Notices. All communications hereunder shall be in
-------
writing, and, if to the Underwriters, shall be mailed or
delivered to you at the address set forth above, or, if to the
Company, shall be mailed or delivered to it at 1601 Bryan Street,
Dallas, Texas 75201, Attention: Treasurer.
If the foregoing is in accordance with your
understanding of our agreement, please indicate your acceptance
thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding
agreement between the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
TEXAS UTILITIES COMPANY
By
-----------------------------------
Name:
Title:
Accepted and delivered as of
the date first above written
[ ]
By: [ ]
By:
-------------------------------
Name:
Title:
SCHEDULE I
Underwriting Agreement dated: , 1998
----------------
Representative:
Securities
----------
Designation:
Aggregate Principal Amount:
Maturity Date:
Purchase Price: % of aggregate principal amount
----
Public Offering Price: % of aggregate principal amount
---
SCHEDULE II
Texas Utilities Company
Debt Securities
Name Principal Amount of Debt Securities
---- -----------------------------------
SCHEDULE III
[Letterhead of Worsham, Forsythe & Wooldridge, L.L.P.]
, 1998
-------------
as Representatives
------------------
of the Underwriters named in the Underwriting
Agreement, dated , 1998, between
------------
Texas Utilities Company and the Underwriters
[address]
Ladies and Gentlemen:
We have acted as General Counsel to Texas Utilities
Company (the "Company") in connection with the issuance and sale
of $ aggregate principal amount of its % Debt
----------- --
Securities due (the "Securities") pursuant to the
-----------
Underwriting Agreement dated , 1998 between the
-------------
Company and the Underwriters named therein (the "Underwriting
Agreement").
Terms not otherwise defined herein are used with the
meanings ascribed to them in the Underwriting Agreement.
In so acting we have participated in or reviewed the
corporate proceedings in connection with the authorization,
execution and delivery of the Underwriting Agreement, the
Indenture and the Securities. We have also examined such other
documents and satisfied ourselves as to such other matters as we
have deemed necessary as a basis for the conclusions of law
contained in the opinions enumerated below. We have relied as to
various questions of fact upon the representations and warranties
of the Company contained in the Underwriting Agreement and, where
we deemed appropriate, on certificates of public officials. We
have relied upon a certificate of the trustee under the Indenture
as to the authentication of the Securities. In our examination
we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted
to us as photostatic or certified copies.
Upon the basis of our familiarity with these
transactions and with the affairs and properties of the Company
generally, we are of the opinion that:
1. The Company is a corporation duly authorized,
validly existing and in good standing under the laws of the State
of Texas, and has the corporate power and authority: (a) to
execute, deliver and perform its obligations under the
Underwriting Agreement and the Indenture, (b) to issue the
Securities and to incur the indebtedness to be evidenced thereby
and (c) to own its property and assets and to conduct the
business which it is now conducting;
2. The Underwriting Agreement has been duly
authorized, executed and delivered by the Company;
3. The Securities and the Indenture have been duly
authorized, executed and delivered by the Company; the Securities
are entitled to the benefits of the Indenture; and the Securities
and the Indenture are legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their
respective terms, subject to the effect of bankruptcy,
insolvency, reorganization, receivership, moratorium and other
laws affecting the rights and remedies of creditors generally and
of general principles of equity;
4. The Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended;
5. The statements made in the Prospectus under the
captions "Description of Debt Securities" and "Description of the
Senior Notes", insofar as they purport to constitute summaries of
the terms of the documents referred to therein, constitute
accurate summaries of the terms of such documents in all material
respects;
6. Other than as stated, referred to or incorporated
by reference in the Registration Statement and the Prospectus,
there are no material pending legal proceedings to which the
Company is a party or of which property of the Company is the
subject which depart from the ordinary routine litigation
incident to the kind of business conducted by the Company, and to
our best knowledge no such proceedings are contemplated;
7. The Registration Statement, as of the Effective
Date, and the Prospectus, at the time it was filed with the
Commission pursuant to Rule 424 under the Securities Act, (except
as to financial statements and schedules and other financial and
statistical data contained therein as to which we do not express
any belief and except for those parts of the Registration
Statement that constitute the Forms T-1) complied as to form in
all material respects with the applicable requirements of the
Securities Act and the applicable instructions, rules and
regulations of the Commission thereunder; the Incorporated
Documents (except as to the financial statements and schedules
and other financial and statistical data contained therein, as to
which we do not express any belief), at the time they were filed
with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act and the applicable
instructions, rules and regulations of the Commission thereunder;
and the Registration Statement has become and is effective under
the Securities Act and, to our best knowledge, no proceedings for
a stop order with respect thereto are pending or threatened under
Section 8 of the Securities Act;
8. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the provisions of the blue-sky laws of any
jurisdiction) is legally required for the authorization of the
issue and sale by the Company of the Securities; and
9. Each Principal Subsidiary (as defined below) of the
Company has been incorporated and is validly existing and
subsisting as a corporation under the laws of the jurisdiction of
its incorporation; each Principal Subsidiary of the Company has
the corporate power and authority to own, lease and operate its
properties and to conduct its business as presently conducted and
as set forth in or contemplated by the Prospectus, and to our
knowledge, is qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure to so qualify or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, considered as a whole; and except as set forth in
or contemplated by the Registration Statement and the Prospectus,
all of the issued and outstanding capital stock of each Principal
Subsidiary of the Company has been authorized and is non-
assessable and, to our knowledge, all such shares are validly
issued and fully paid and (except for directors' qualifying
shares) are owned by the Company, directly or through is
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity other than those
ordinary shares of TU Finance (No. 2) Limited, TU Acquisitions
PLC, The Energy Group Limited acquired indirectly by the Company,
which have been pledged as collateral for borrowings made by
subsidiaries. For purposes of this opinion, the term "Principal
Subsidiary" shall mean, collectively, the following companies:
Eastern Energy Limited, Texas Utilities Australia Pty. Ltd., The
Energy Group Limited, Eastern Group plc, Eastern Electricity plc,
Eastern Generation Limited, Eastern Natural Gas Limited, Eastern
Power and Energy Trading Limited, Texas Energy Industries, Inc.,
ENSERCH Corporation, Lufkin-Conroe Communications Co.,
Southwestern Electric Service Company, Texas Utilities Electric
Company, Texas Utilities Fuel Company, Texas Utilities Mining
Company and Texas Utilities Services Inc.
In the course of the preparation of the information
relating to the Company contained in the Registration Statement
and the Prospectus (including the documents incorporated therein
by reference), we had discussions with certain of its officers
and representatives and certain officers and representatives of
certain of its subsidiaries, with other counsel for the Company,
with Deloitte & Touche LLP, the independent certified public
accountants who audited certain of the financial statements of
the Company incorporated by reference in the Registration
Statement and the Prospectus, with Ernst & Young, the independent
certified public accountants who audited certain of the financial
statements of Energy Holdings (No. 3) Limited (formerly known as
The Energy Group PLC) incorporated by reference in the
Registration Statement and the Prospectus, and with certain of
your officers and employees and your counsel, but we made no
independent verification of the accuracy or completeness of the
representations and statements made to us by the Company or the
information included by the Company in the Registration Statement
and the Prospectus and take no responsibility therefor except as
set forth in paragraph 5 above. However, our examination of the
information relating to the Company contained in the Registration
Statement and the Prospectus and our discussions did not disclose
to us anything which gives us reason to believe that (except as
to the financial statements and schedules and other financial and
statistical data contained therein as to which we do not express
any belief and except for those parts of the Registration
Statement that constitute the Forms T-1) (i) the Registration
Statement, as of the Effective Date, included an untrue statement
of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein
not misleading or (ii) the Prospectus, at the time it was filed
with the Commission pursuant to Rule 424 under the Securities
Act, included, or on the date hereof includes, an untrue
statement of a material fact or on such dates omitted or omits to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
We are members of the State Bar of Texas and do not
hold ourselves out as experts in the laws of the State of New
York. As to all matters of New York law, we have, with your
consent, relied upon the opinion of Thelen Reid & Priest LLP, New
York, New York, of Counsel to the Company; as to matters of the
law of the United Kingdom, we have, with your consent relied upon
the opinions of M.C. Murray, London, England, General Counsel and
Secretary of The Energy Group Limited and E.J. Lean, Group
Solicitor of Eastern Group plc, and as to
all matters of law of the Commonwealth of Australia we have with
your consent relied upon the opinion of Baker & McKenzie, Sidney,
Commonwealth of Australia, Counsel to Texas Utilities Australia
Pty. Ltd.
Very truly yours,
WORSHAM, FORSYTHE &
WOOLDRIDGE, L.L.P.
By:
---------------------------
A Partner
SCHEDULE IV
[Letterhead of Thelen Reid & Priest LLP]
New York, New York
, 1998
------------------
----------------------------
as Representatives if the Underwriters named in the
Underwriting Agreement, dated , 1998,
-------------
between Texas Utilities Company and the Underwriters
[address]
Ladies and Gentlemen:
We have acted as counsel to Texas Utilities Company
(the "Company") in connection with the issuance and sale of
$ aggregate principal amount of its % Debt
----------- --
Securities due (the "Securities") pursuant to
-----------------
the Underwriting Agreement dated , 1998 between
---------------
the Company and the Underwriters (the "Underwriting Agreement").
Terms not otherwise defined herein are used with the
meanings ascribed to them in the Underwriting Agreement.
In so acting we have participated in or reviewed the
corporate proceedings in connection with the authorization,
execution and delivery of the Underwriting Agreement, the
Indenture and the Securities. We have also examined such other
documents and satisfied ourselves as to such other matters as we
have deemed necessary as a basis for the conclusions of law
contained in the opinions enumerated below. We have relied as to
various questions of fact upon the representations and warranties
of the Company contained in the Underwriting Agreement and, where
we deemed appropriate, on certificates of public officials. We
have relied upon a certificate of the trustee under the Indenture
as to the authentication of the Securities. In our examination
we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted
to us as photostatic or certified copies.
Upon the basis of our familiarity with these
transactions and with the affairs and properties of the Company
generally, we are of the opinion that:
1. The Underwriting Agreement has been duly
authorized, executed and delivered by the Company.
2. The Securities and the Indenture have been duly
authorized, executed and delivered by the Company; the Securities
are entitled to the benefits of the Indenture; and the Securities
and the Indenture are legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their
respective terms, subject to the effect of bankruptcy,
insolvency, reorganization, receivership, moratorium and other
laws affecting the rights and remedies of creditors generally and
of general principles of equity.
3. The Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended.
4. The statements made in the Prospectus under the
captions "Description of Debt Securities" and "Description of the
Senior Notes", insofar as they purport to constitute summaries of
the terms of the documents referred to therein, constitute
accurate summaries of the terms of such documents in all material
respects; the statements made in the Prospectus under the caption
"Certain United States Federal Income Tax Considerations",
insofar as they involve legal matters or legal conclusions, are
correct in all material respects.
5. The Registration Statement, as of the Effective
Date, and the Prospectus, at the time it was filed with the
Commission pursuant to Rule 424 under the Securities Act, (except
as to the financial statements and schedules and other financial
and statistical data contained therein as to which we do not
express any belief and except for those parts of the Registration
Statement that constitute the Forms T-1) complied as to form in
all material respects with the applicable requirements of the
Securities Act and the applicable instructions, rules and
regulations of the Commission thereunder; the Incorporated
Documents (except as to the financial statements and schedules
and other financial and statistical data contained therein, as to
which we do not express any belief), at the time they were filed
with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act and the applicable
instructions, rules and regulations of the Commission thereunder;
and the Registration Statement has become and is effective under
the Securities Act and, to our best knowledge, no proceedings for
a stop order with respect thereto are pending or threatened under
Section 8 of the Securities Act.
6. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the provisions of the blue-sky laws of any
jurisdiction) is legally required for the authorization of the
issue and sale by the Company of the Securities.
In the course of the preparation of the information
relating to the Company contained in the Registration Statement
and the Prospectus (including the documents incorporated therein
by reference) we had discussions with certain of its officers and
representatives and certain officers and representatives of
certain of its subsidiaries, with other counsel for the Company,
with Deloitte & Touche LLP, the independent certified public
accountants who audited certain of the financial statements of
the Company incorporated by reference in the Registration
Statement and the Prospectus, with Ernst & Young, the independent
certified public accountants who audited certain of the financial
statements of Energy Holdings (No. 3) Limited (formerly known as
The Energy Group PLC) incorporated by reference in the
Registration Statement and the Prospectus and with certain of
your officers and employees and your counsel, but we made no
independent verification of the accuracy or completeness of the
representations and statements made to us by the Company or the
information included by the Company in the Registration Statement
and the Prospectus and take no responsibility therefor except as
set forth in paragraph 4 above. However, our examination of the
information relating to the Company contained in the Registration
Statement and the Prospectus and our discussions did not disclose
to us anything which gives us reason to believe that (except as
to the financial statements and schedules and other financial and
statistical data contained therein, as to which we do not express
any belief and except for those parts of the Registration
Statement that constitute the Forms T-1) (i) the Registration
Statement, as of the Effective Date, included an untrue statement
of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein
not misleading or (ii) the Prospectus, at the time it was filed
with the Commission pursuant to Rule 424 under the Securities
Act, included, or on the date hereof includes, an untrue
statement of a material fact or on such dates omitted or omits to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
We are members of the New York Bar and do not hold
ourselves out as experts in the laws of the State of Texas. As
to all matters of Texas law, we have, with your consent, relied
upon the opinion of Worsham, Forsythe & Wooldridge, L.L.P.,
Dallas, Texas, General Counsel for the Company. We believe that
you and we are justified in relying on such opinion.
Very truly yours,
THELEN REID & PRIEST LLP
SCHEDULE V
[Letterhead of Winthrop, Stimson, Putnam & Roberts]
New York, New York
, 1998
----------
as Representatives of the Underwriters
---------------
named in the Underwriting Agreement, dated , 1998,
------------
between Texas Utilities Company and the Underwriters
[address]
Ladies and Gentlemen:
We have acted as counsel to the Underwriters in
connection with their several purchases from Texas Utilities
Company (the "Company") of $ principal amount of the
-----------
Company's % Debt Securities due , (the
-- --------------
"Securities") pursuant to the Underwriting Agreement dated
, 1998 between the Underwriters and the Company (the
-------------
"Underwriting Agreement").
Terms not otherwise defined herein are used with the
meaning ascribed to them in the Underwriting Agreement.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of the State of Texas. We
have, with your consent, relied upon an opinion of even date
herewith addressed to you by Worsham, Forsythe & Wooldridge,
L.L.P., of Dallas, Texas, General Counsel for the Company, as to
the matters covered in such opinion relating to Texas law. We
have reviewed such opinion and believe that it is satisfactory
and that you and we are justified in relying thereon. We have
also reviewed the opinion of Thelen Reid & Priest LLP, Counsel to
the Company, required by paragraph (c) of Section 6 of the
Underwriting Agreement, and we believe such opinion to be
satisfactory.
We have, in addition, examined the documents described
in the list of closing papers as having been delivered to you at
the closing and such other documents and satisfied ourselves as
to such other matters as we have deemed necessary in order to
enable us to express this opinion. We have not examined the
Securities, except specimens thereof, and have relied upon a
certificate of the trustee under the Indenture as to the
authentication of the Securities. As to various questions of
fact material to this opinion, we have relied upon
representations of the Company and statements in the Registration
Statement hereinafter mentioned. In such examination we have
assumed the genuineness of all signatures, the authenticity of
all documents submitted to us and the genuineness and conformity
to original documents of documents submitted to us as certified
or photostatic copies.
Based on the foregoing, we are of the opinion that:
1. The Underwriting Agreement has been duly
authorized, executed and delivered by the Company;
2. The Securities and the Indenture have been duly
authorized, executed and delivered by the Company; the
Securities are entitled to the benefits of the Indenture;
and the Securities and the Indenture are legal, valid and
binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, subject
to the effect of bankruptcy, insolvency, reorganization,
receivership, moratorium and other laws affecting the rights
and remedies of creditors generally and of general
principles of equity;
3. The Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended;
4. The statements made in the Prospectus under the
captions "Description of Debt Securities" and "Description
of the Senior Notes", insofar as they purport to constitute
summaries of the documents referred to therein, constitute
accurate summaries of the terms of such documents in all
material respects;
5. No other approval, authorization, consent or order
of any public board or body (other than in connection or in
compliance with the blue-sky laws of any jurisdiction) is
legally required for the authorization of the issue and sale
by the Company of the Securities; and
6. The Registration Statement, at the Effective Date
thereof, and the Prospectus, at the time it was filed with
the Commission pursuant to Rule 424 (except in each case as
to financial statements and schedules and other financial
and statistical data contained or incorporated by reference
therein and except for those parts of the Registration
Statement that constitute the Forms T-1, upon which we
express no opinion), complied as to form in all material
respects with the Securities Act.
In passing upon the form of the Registration Statement
and the form of the Prospectus, we necessarily assume the
correctness and completeness of the statements made by the
Company and the information included in the Registration
Statement and the Prospectus and take no responsibility therefor,
except insofar as such statements relate to us and as set forth
in paragraph 4 above. In the course of the preparation by the
Company of the Registration Statement and the Prospectus, we have
had discussions with certain of its officers and representatives,
and officers and representatives of certain of its subsidiaries,
with counsel for the Company, with Deloitte & Touche LLP, the
independent public accountants who audited certain of the
financial statements of the Company incorporated by reference in
the Registration Statement and the Prospectus, with Ernst &
Young, the independent public accountants who audited certain of
the financial statements of Energy Holdings (No. 3) Limited
(formerly known as The Energy Group PLC) incorporated by
reference in the Registration Statement and the Prospectus, and
with certain of your representatives. Our examination of the
Registration Statement and the Prospectus and our discussions did
not disclose to us any information which gives us reason to
believe that at the Effective Date the Registration Statement
contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the
Prospectus, at the time it was filed with the Commission pursuant
to Rule 424, or at the date hereof, included or includes any
untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. We do not express any opinion or belief as
to the financial statements or other financial or statistical
data contained or incorporated by reference in the Registration
Statement or the Prospectus or as to those parts of the
Registration Statement that constitute the Forms T-1.
This opinion is given to you solely for your use in
connection with the Underwriting Agreement and the transactions
contemplated thereunder and may not be relied upon by any other
person or for any other purpose.
Very truly yours,
WINTHROP, STIMSON, PUTNAM & ROBERTS