SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
September 29, 1997
ENSERCH EXPLORATION, INC.
(Exact name of Registrant as specified in its charter)
Texas 1-12905 752421863
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
2500 City West Boulevard,
Suite 1400,
Houston, Texas 77046
(Address of principal executive offices) (Zip Code)
(281) 271-3100
(Registrant's telephone number, including Area Code)
Item 5. Other Events.
On September 29, 1997, Enserch Exploration, Inc. ("Company")
concluded a transaction in which all of the outstanding
adjustable rate mandatorily redeemable preferred securities of
MIStS Issuer L.L.C. ("Issuer"), a Company subsidiary, was
redeemed at the stated value of $150,000,000. The redemption was
funded by a private sale of new issues of equal value of
preferred interests of Issuer and preferred stock of EEX Capital
Inc. ("EEXC"), also a subsidiary of the Company. The new
securities bear a dividend rate (reset quarterly) of LIBOR, plus
a spread equal to 300 basis points for the period though
December 31, 1997, with escalation quarterly of 100 basis points
through December 31, 1998. The dividend rate on the redeemed
securities was LIBOR plus 42.5 basis points. The new securities
are redeemable at the option of Issuer and EEXC, in whole or in
part, on their respective quarterly dividend payment dates.
Interest payable on a $150,000,000 intercompany demand note
made by the Company in favor of EEXC, and a $75,000,000
intercompany demand note made by EEXC in favor of Issuer will
fund the dividends to be paid on the new preferred securities.
The Company's guaranty of the EEXC note to Issuer, by its terms,
is subordinated to "senior debt" as defined in the Company's
Revolving Credit Facility.
Item 7. Financial Statements and Exhibits.
Exhibits
4.1 Second Amended and Restated Limited Liability
Company Agreement of MIStS Issuer L.L.C. dated as
of September 29, 1997.
4.2 Certificate of Designations, Preferences and
Relative, Participating, Optional and Other
Special Rights - Class A Cumulative Perpetual
Increasing Dividend Preferred Stock of EEX Capital
Inc., dated, and filed with the Delaware Secretary
of State on, September 29, 1997.
4.3 Preferred Stock Registration Rights Agreement
dated as of September 29, 1997, by and between EEX
Capital Inc. and UBS Securities L.L.C.
4.4 Subscription Agreement among EEX Capital Inc.,
MIStS Issuer L.L.C., UBS Securities LLC, as
Placement Agent for the Holders from time to time
of the Preferred Securities and Enserch
Exploration, Inc. (not an issuer), dated as of
September 29, 1997.
4.5 $150,000,000 Subordinated Promissory Note made by
Enserch Exploration, Inc. in favor of EEX Capital
Inc., dated September 29, 1997.
4.6 $75,000,000 Subordinated Promissory Note made by
EEX Capital Inc. in favor of MIStS Issuer L.L.C.,
dated September 29, 1997.
4.7 Amended and Restated Guaranty Agreement of Enserch
Exploration, Inc., dated as of September 29, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
Enserch Exploration, Inc.
Date: October 6, 1997 By: /s/ J. T. Leary
-------------------------
J. T. Leary
Vice President,
Finance and Treasurer