Exhibit 4(w)
CONFORMED COPY
Date: 27 November 2000
TXU EASTERN FUNDING COMPANY
(pound) 301,000,000 35 Put 5 Resettable Securities due 2035
issued pursuant to the EUR 2,000,000,000 Euro Medium Term Note Programme
unconditionally and irrevocably guaranteed by
TXU Europe Limited
(the "PROGRAMME")
(Terms used herein shall be deemed to be defined as such for the purposes of the
Conditions)
The Notes constitute longer term debt securities issued in accordance with
regulations made under section 4 of the Banking Act 1987. The Issuer of the
Notes is not an authorised institution or a European authorised institution (as
such are defined in the Banking Act 1987 (Exempt Transactions) Regulations
1997). Repayment of the principal and payment of any interest in connection with
the Notes has been guaranteed by TXU Europe Limited, which is not an authorised
institution or a European authorised institution.
This Pricing Supplement, under which the Notes described herein (the "NOTES")
are issued, is supplemental to, and should be read in conjunction with, the
Offering Circular (the "OFFERING CIRCULAR") dated 15 December 1999 issued in
relation to the Programme. The Notes will be issued on the terms of this Pricing
Supplement read together with the Offering Circular.
PROVISIONS APPEARING ON THE FACE OF THE NOTES
1. Series No.: 4
2. Tranche No.: 1
3. ISIN: XS0120779128
4. Relevant Currency: Pounds Sterling ("(POUND)"), subject to
redenomination as provided in Paragraph
9
5. Nominal Amount of Tranche: (pound)301,000,000, subject to
redenomination as provided in Paragraph
9.
6. Issue Date: 29 November 2000
PROVISIONS APPEARING ON THE BACK OF THE NOTES
7. Form: Bearer
8. Denomination(s): (pound)1,000, subject to redenomination
as provided in Paragraph 9.
9. Redenomination into Euro: If at any time prior to the Interest
Reset Date (as defined below) the Notes
become due and payable pursuant to
Condition 10 following the occurrence of
an Event of Default, then:
(a) the Notes shall be redenominated
in Euro with immediate effect (at
the rate of (pound)3.01 =
(euro)5.00) so that the
denomination of each Note shall
become (euro)1,000 and the Nominal
Amount of the Notes shall become
(euro)500,000,000;
(b) interest payable on the Notes
shall, with effect from the
immediately preceding Interest
Payment Date, accrue and be
calculated at the rate of 7.00
per cent. per annum (in lieu
of the rate specified in
Paragraph 11) on the Notes as
redenominated under this
provision; and
(c) the provisions of Condition
7(i)(iii), (iv), (v)
(excluding the words ", other
than payments of interest in
respect of periods commencing
before the Redenomination
Date") and (vi) shall apply
but for such purposes
"REDENOMINATION DATE" shall
mean the date of such
redenomination.
Save as aforesaid, Condition 7(i)
(Redenomination) shall not apply.
10. Interest Commencement Date: 29 November 2000
11. Interest Rate (including Interest-bearing: Condition 5 shall
after Maturity Date): apply to the Notes, save as provided
herein.
From and including the Interest
Commencement Date to, but excluding, 30
November 2005, the Notes bear interest
at the rate of 7.7875 per cent. per
annum, subject as provided in Paragraph
9, payable annually in arrear on 30
November in each year, subject to
Condition 7(g). During such period, the
Interest Amount payable in respect of
each Denomination of the Notes for each
Interest Period shall be (pound)77.88,
subject as provided in Paragraph 9
Provided that for the initial Interest
Period commencing on (and including) the
Interest Commencement Date and ending on
(but excluding) 30 November 2001 the
Interest Amount shall be (pound) 78.10,
subject as provided in Paragraph 9.
From, and including, 30 November 2005
or, if such day is not a Business Day
(as defined in Condition 5(i)), the next
following Business Day (the "INTEREST
RESET DATE") provided the Notes have
been purchased on such date in
accordance with the provisions contained
or referred to in Paragraph 44(B), the
Notes will bear interest at the Interest
Reset Rate (as defined below),
determined pursuant to and in accordance
with the following provisions in this
Paragraph 11 (the "INTEREST RESET
PROCEDURE"), payable annually in arrear
on 30 November in each year, with the
first such payment being made on 30
November 2006, subject to Condition
7(g).
The following provisions of this
Paragraph 11 shall apply if a Purchase
Notice (as defined in the Supplemental
Trust Deed) is given to the Trustee and
Issuing and Paying Agent not less than
fifteen Business Days prior to the
Interest Reset Date as contemplated in
Clause 2.1(i) of the Supplemental Trust
Deed.
THE INTEREST RESET PROCEDURE
(i) No later than the sixth Business Day
preceding the Interest Reset Date, the
Determination Agents will provide each
Reference Securities Dealer with: (a) a
copy of this Pricing Supplement, (b) the
most recently published offering
circular of the Issuer published in
relation to its (euro)2,000,000,000 Euro
Medium Term Note Programme, (c) a
written request for a Bid (as defined
below) from such Reference Securities
Dealer to be submitted to the
Determination Agents at 11.00 a.m.
(London time) on the Bid Date (as
defined below) and
(d) the Determination Agents' estimate
of the Reference Bond Price (as defined
below).
(iii) At or about 11.00 a.m. (London
time) on the Business Day preceding the
Bid Date, the Determination Agents will
calculate the Reference Bond Price,
notify each Reference Securities Dealer
thereof and request a Bid from each
Reference Securities Dealer.
(iv) By 11.30 a.m. (London time) on the
Bid Date, the Determination Agents will
notify the Issuer in writing of: (a) the
Bid received from each Reference
Securities Dealer; and (b) the Reference
Bond Price, as determined by the
Determination Agents in their sole
discretion.
(v) Unless the Interest Reset Procedure
shall be terminated, the Determination
Agents shall select from all the Bids
received from the Reference Securities
Dealers the Bid (the "SELECTED BID")
quoting the lowest annual interest rate
(the "LOWEST BID RATE"), and if there is
more than one such Bid, the
Determination Agents shall be entitled
to select one of them at their sole
discretion. Morgan Stanley & Co.
International Limited ("MSIL" which
shall include its successors and
assigns), UBS AG, acting through its
business group UBS Warburg ("UBS
WARBURG" which shall include its
successors and assigns) (severally where
only one exercises such entitlement or
together (and in equal shares) where
both exercise such entitlement) shall
have the right (but shall be under no
obligation) to match the Selected Bid,
in which case such matching Bid shall be
the Selected Bid.
(vi) If: (a) fewer than two Bids are
received by the Determination Agents;
and/or (b) the Determination Agents in
their absolute discretion determine that
there is a Market Disruption Event (as
defined below) on the Bid Date; and/or
(c) the Notes shall have been
redenominated pursuant to Paragraph 9
and/or (d) an Event of Default shall
have occurred and/or (e) the
Determination Agents shall have received
notice from the Issuer at any time prior
to their selection of the Selected Bid
that the Issuer wishes to terminate the
Interest Reset Procedure, then the
Interest Reset Procedure shall be
terminated, the Issuer shall (and the
Determination Agents may) give notice to
the Trustee and the Issuing and Paying
Agent (as contemplated in Clause 2.1(ii)
of the Supplemental Trust Deed) of such
termination and the Notes shall be
redeemed by the Issuer in accordance
with Paragraph 44(B).
The following provisions of this
Paragraph 11 shall apply only where the
Interest Reset Procedure has not been
terminated.
(vii) The Determination Agents will
determine the Interest Reset Rate (the
"INTEREST RESET RATE") to be the Lowest
Bid Rate.
(viii) No later than 11.30 a.m. (London
time) on the Bid Date, the Determination
Agents will notify the Reference
Securities Dealer whose Bid is the
Selected Bid of such fact.
(ix) As soon as practicable after
determining the Interest Reset Rate as
aforesaid, the Determination Agents will
calculate the Interest Amount payable in
respect of each Denomination of Notes
for each Interest Period.
(x) The Determination Agents will cause
the Interest Rate and the Interest
Amount to be notified to the Issuer, the
Paying Agents, the Trustee, the
Noteholders and, for so long as the
Notes are listed on the Luxembourg Stock
Exchange and the rules of such exchange
so require, the Luxembourg Stock
Exchange as soon as possible after
determination thereof and in any event
in accordance with Condition 5(g).
For the purposes of the Conditions
relating to the Notes:
All determinations by the Determination
Agents shall (in the absence of manifest
error) be final and binding.
"REFERENCE SECURITIES DEALERS" means up
to five financial institutions
comprising MSIL and UBS Warburg and up
to three additional financial
institutions agreed between the Issuer
and the Determination Agents which, at
the time of agreement, deal in the
Issuer's debt securities and which shall
agree to participate in the Interest
Reset Procedure.
"REFERENCE SWAP DEALERS" means up to
five financial institutions comprising
MSIL and UBS Warburg and up to three
additional financial institutions agreed
between the Issuer and the Determination
Agents which are leading swap dealers.
"BID" means an irrevocable written offer
given by a Reference Securities Dealer
at or about 11.00 a.m. (London time) on
the Bid Date to purchase all the Notes
outstanding at the Reference Bond Price
for settlement on the Interest Reset
Date such offer to be conditional on the
acquisition of the Notes by MSIL and UBS
Warburg under the Purchase Rights, to be
expressed as an annual fixed rate of
interest (being the rate which such
Reference Securities Dealer requires to
be payable on the Notes until the
Maturity Date), to be given on an
"all-in" basis and to be expressed to be
open for acceptance for at least 30
minutes.
"BID DATE" means the third Business Day
preceding the Interest Reset Date.
"MARKET DISRUPTION EVENT" means the
occurrence of any of the following
events in the judgement of the
Determination Agents: (a) a suspension
or material limitation in trading in
securities generally on the London Stock
Exchange or the establishment of minimum
prices on such exchange; (b) a general
moratorium on commercial banking
activities declared by the Bank of
England or the Financial Services
Authority; (c) any material adverse
change in the existing financial,
political or economic conditions in the
United Kingdom which has a material and
adverse effect on the trading of the
Notes; (d) an outbreak, or escalation,
of major hostilities involving the
United Kingdom or the declaration of a
national emergency or war by the
Government of the United Kingdom; or (e)
any material disruption of the United
Kingdom Gilt market, the United Kingdom
corporate bond market or banking system;
provided, in each case, that in the sole
judgement of the Determination Agents
the effect of the foregoing makes it
impractical to conduct the Interest
Reset Procedure.
"PURCHASE RIGHTS" has the meaning given
thereto in the Supplemental Trust Deed
(as defined below).
"REFERENCE BOND PRICE" means an amount
as determined by the Determination
Agents on the Bid Date equal to the
discounted present value to the Interest
Reset Date of a bond with a maturity
date of 30 November 2035 bearing
interest payable annually on a 30/360
day count basis at 6.25% per annum and a
principal amount equal to the Nominal
Amount of the Notes and assuming a
discount rate equal to the Reference
Swap Yield.
"REFERENCE SWAP YIELD" means the
percentage rate per annum determined by
the Determination Agents on the basis of
the annual swap rate quotations provided
by the Reference Swap Dealers at
approximately 11.00 a.m. (London time)
on the Business Day preceding the Bid
Date and, for this purpose, the annual
swap rate means the bid rate for the
annual fixed leg of a fixed-for-floating
Sterling interest rate swap transaction
(quoted on a 30/360 day unadjusted day
count basis and assuming the application
of the Following Business Day Convention
(as defined in the 2000 ISDA Definitions
(the "DEFINITIONS")) with a term
commencing on the Interest Reset Date
and ending on 30 November 2035 with a
notional amount of (pound)301,000,000
with an acknowledged dealer of good
credit in the swap market, where the
floating leg is equivalent to
GBP-LIBOR-BBA (as defined in the
Definitions) with a Designated Maturity
(as defined in the Definitions) of three
months on an Actual/365 (as defined in
the Definitions) day count basis. The
Reference Swap Yield will be the
arithmetic average of such quotations,
eliminating (where there are at least
three quotations) the highest quotation
(or, in the event of equality, one of
the highest) and the lowest quotation
(or, in the event of equality, one of
the lowest).
12. Interest Payment Date(s): 30 November in each year, commencing on
30 November 2001.
13. Relevant Time (Floating Rate Not applicable
Notes):
14. Interest Determination Date Not applicable
(Floating Rate Notes):
15. Primary Source for the Floating Not applicable
Rate:
16. Reference Banks: Not applicable
17. Relevant Financial Centre Not applicable
(Floating Rate Notes):
18. Benchmark (Floating Rate Notes): Not applicable
19. Representative Amount (Floating Not applicable
Rate Notes):
20. Effective Date (Floating Rate Not applicable
Notes):
21. Specified Duration (Floating Rate Not applicable
Notes):
22. Margin (if applicable): Not applicable
23. Rate Multiplier (if applicable): Not applicable
24. Maximum/Minimum Interest Rate (if Not applicable
applicable):
25. Maximum/Minimum Instalment amount Not applicable
(if applicable):
26. Maximum/Minimum Redemption Amount Not applicable
(if applicable):
27. Interest Amount (Fixed Rate Note See Paragraph 11
or Variable Coupon Amount Note):
28. Day Count Fraction: 30/360 unadjusted
29. Interest Period Date(s) (if Not applicable
applicable):
30. Redemption Amount (including Nominal Amount
early redemption):
31. Maturity Date: 30 November 2035
32. Redemption for Taxation Reasons Yes
permitted on days other than
Interest Payment Dates:
33. Amortisation Yield (Zero Coupon Not applicable
Notes):
34. Terms of redemption at the option Not applicable
of the Issuer or description of
any other Issuer's option (if
applicable):
35. Issuer's Option Period (if Not applicable
applicable):
36. Terms of redemption at the option Not applicable.
of the Noteholders or description
of any other Noteholders' option
(if applicable):
37. Noteholders' Option Period (if Not applicable
applicable):
38. Instalment Date(s) (if Not applicable
applicable):
39. Instalment Amount(s) (if Not applicable
applicable):
40. Unmatured Coupons to become void Yes
upon early redemption:
41. Talons to be attached to Notes No
and, if applicable, the number
of Interest Payment Dates between
the maturity of each Talon (if
applicable):
42. Business Day Jurisdictions for For the purposes of Condition 7(g)
Condition 7(g) (jurisdictions "BUSINESS DAY" means a day (other than a
required to be open for payment): Saturday or Sunday) on which the TARGET
system is open and on which banks and
foreign exchange markets are open for
business in London and the relevant
place of presentation.
43. Additional steps that may only be Not applicable
taken following approval by an
Extraordinary Resolution in
accordance with Condition 11(a) (if
applicable):
44. Details of any other additions or
variations to the Conditions (if
applicable):
(A) Redemption at the Option of Condition 6(b), Condition 6(d),
the Issuer, Redemption at Condition 6(e) and Condition 6(g) shall
the Option of the not apply to the Notes.
Noteholders, Cancellation:
(B) Transfer and Reset or Put: The Notes will be subject to the
following provisions:
(i) The Issuer and the Trustee will
enter into a first supplemental trust
deed on or around 29 November 2000 (the
"SUPPLEMENTAL TRUST DEED") in relation
to the Notes. The Supplemental Trust
Deed provides, inter alia, that if the
conditions set forth in Clause 2.1
thereof are satisfied the Notes shall be
purchased by the Issuer at par and shall
not be redeemed and cancelled upon such
purchase. The Issuer shall be entitled
in its discretion to transfer or assign
the benefit of its rights to purchase
the Notes. If the conditions set forth
in Clause 2.1 of the Supplemental Trust
Deed are not satisfied, the Issuer shall
redeem the Notes on the Interest Reset
Date at par and shall procure that the
Notes (and all Coupons appertaining
thereto) are cancelled by the Issuing
and Paying Agent.
The Issuer has offered to assign its
rights to purchase the Notes as
mentioned above to MSIL and UBS Warburg.
Under the terms of such offer, the
Issuer has agreed to make payments to
MSIL and UBS Warburg in certain
circumstances where the purchase of the
Notes by or on behalf of MSIL and UBS
Warburg will not occur.
The Issuer, the Trustee, the Paying
Agents, MSIL and UBS Warburg will also
enter into a supplemental agency
agreement on or around 29 November 2000
(the "SUPPLEMENTAL AGENCY AGREEMENT") in
relation to the Notes. The Supplemental
Agency Agreement shall contain payment
provisions relating to the purchase of
Notes as well as provisions relating to
transfers of Notes, endorsement of Notes
and cancellation of Notes. See Paragraph
44(B)(v).
Noteholders are deemed to have notice
of, and are bound by, all the provisions
of the Trust Deed, the Supplemental
Trust Deed, this Pricing Supplement and
those provisions applicable to them of
the Agency Agreement and the
Supplemental Agency Agreement.
Copies of the Supplemental Trust Deed
and the Supplemental Agency Agreement
shall be available for inspection by
Noteholders during normal business hours
at the specified offices of the Trustee
and the Paying Agents.
(ii) On the Interest Reset Date, each
Noteholder who presents and surrenders a
Note and all Coupons appertaining
thereto to any Paying Agent, shall be
entitled to payment of an amount equal
to the nominal amount of the Notes so
presented and surrendered (together with
interest accrued to, but excluding, the
Interest Reset Date).
No transfers of Notes through any
clearing system will be permitted during
the three Business Days immediately
preceding the Interest Reset Date other
than for the purpose of facilitating
such presentation and surrender.
(iii) On the Interest Reset Date all
Notes shall be:
(a) immediately transferred to, or to
the order of, the Purchase Rights
Holder(s) (as defined in the
Supplemental Trust Deed) as purchaser(s)
of the Notes pursuant to the exercise of
the Purchase Rights; or
(b) redeemed and cancelled (together
with all unmatured Coupons appertaining
thereto).
Notes transferred pursuant to
sub-paragraph (iii)(a) above shall not
be redeemed and cancelled and may be
reoffered and resold in the open market
at the Reference Bond Price or
otherwise. From, and including, the
Interest Reset Date, each Note will bear
interest at the Interest Reset Rate.
(iv) The Noteholders (other than the
Purchase Rights Holder(s) and persons
deriving title through it (or them)
following a purchase of the Notes
pursuant to sub-paragraph (i) above)
shall have no further rights or claims
to payments under the Trust Deed or in
respect of the Notes against the Issuer
or any other person, notwithstanding
that the Notes shall remain outstanding
until the Maturity Date unless redeemed
earlier in accordance with Condition
6(c) or Condition 10.
Notes redeemed and cancelled pursuant to
sub-paragraph (iii)(b) above, and all
unmatured Coupons appertaining thereto,
shall be deemed to be void and may not
be reissued or resold.
(v) In the event that the Notes are
transferred to, or to the order of, the
Issuer in accordance with the provisions
of this Paragraph 44 and, on the
Interest Reset Date, the Notes are
represented by Definitive Notes, unless
all the Notes which are outstanding and
any Coupons appertaining thereto have
been duly surrendered the Issuer shall
procure that prior to transferring the
Notes to, or to the order of, the Issuer
the Issuing and Paying Agent shall
endorse all Definitive Notes and Coupons
which have been presented to a Paying
Agent for payment with a memorandum
stating that on the Interest Reset Date
such Notes have been transferred in
accordance with their terms.
Any Definitive Notes, and any Coupons
appertaining thereto, not so presented
shall be void and the holder thereof
(who shall cease to be a Noteholder for
the purpose of the Conditions and the
Trust Deed) shall not be entitled to any
payment in respect thereof except upon
presentation and surrender of such
Definitive Note together with all
Coupons appertaining thereto to a Paying
Agent when the holder shall be entitled
to receive only the amount it would have
been entitled to receive thereon had it
presented such Note on such date in
accordance with Paragraph 44(B)(ii) and
without any interest thereon and no
payment shall be made if such Note or
Coupons are presented to any Paying
Agent after the tenth anniversary of 30
November 2005. Upon such presentation,
such Definitive Notes (and any Coupons
appertaining thereto) not bearing the
memorandum shall be cancelled and
destroyed by the Issuing and Paying
Agent.
In the event that not all Notes are so
presented, the Issuer shall issue, and
shall procure that the Issuing and
Paying Agent issues a replacement Note
in respect of each Note not presented
which it shall endorse with the
memorandum described above. In such
circumstances, the Issuing and Paying
Agent shall maintain a record of each
replacement Note so issued and details
of the Note it replaces. Such records
shall be available for inspection by the
Issuer, the other Paying Agents and the
Trustee upon reasonable request.
45. The Agents appointed in respect ISSUING AND PAYING AGENT
of the Notes are:
Citibank N.A.,5 Carmelite Street, London
E4Y 0PA
PAYING AGENTS
Kredietbank S.A. Luxembourgeoise, 43
Boulevard Royal, L-2955 Luxembourg
DETERMINATION AGENTS, appointed under an
agreement which will be entered into on
or around 29 November 2000 between the
Issuer, the Guarantor and MSIL and UBS
Warburg
Morgan Stanley & Co. International
Limited, 20 Cabot Square, Canary Wharf,
London E14 4QW
UBS AG, acting through its business
group UBS Warburg, 1 Finsbury Avenue,
London EC2M 2PP
PROVISIONS APPLICABLE TO GLOBAL NOTES AND GLOBAL CERTIFICATES
46. Notes to be represented on issue Temporary Global Note exchangeable on or
by: after its Exchange Date upon customary
certification as to non-U.S. beneficial
ownership for interests in a permanent
Global Note.
47. Applicable TEFRA exemption: D Rules
48. Temporary Global Note No.
exchangeable for Definitive Notes:
49. Permanent Global Note No. Definitive Notes will be available
exchangeable for Definitive Notes if Euroclear, Clearstream, Luxembourg or
at the request of the holder: at the request other clearing system is
closed for business for a continuous
period of 14 days (other than by reason
of holidays, statutory or otherwise) or
announces an intention permanently to
cease business or in fact does so or if
principal in respect of any Notes is not
paid when due.
PROVISIONS RELATING ONLY TO THE SALE AND LISTING OF THE NOTES
50. Details of any additions or Not applicable
variations to the selling
restrictions:
51. Listing: Application has been made to list the
Notes on the Luxembourg Stock Exchange
52. Dealer's Commission: 0.45 per cent.
53. Method of issue of Notes: Syndicated issue
54. The following Dealers are Morgan Stanley & Co. International
subscribing the Notes: Limited and UBS AG, acting through its
business group UBS Warburg
55. Common Code: 012077912
56. Net Proceeds: (pound)299,645,500
57. Use of Proceeds (if different Not applicable
from that stated in the Offering
Circular):
The Issuer confirms that:
(a) as at the date hereof, it has complied with its obligations under the
listing rules of the Luxembourg Stock Exchange in relation to the admission
to, and continuing, listing of notes issued under the Programme and listed
on such Exchange and (if applicable) the Programme;
(b) it will have complied with its obligations under the listing rules of the
Luxembourg Stock Exchange by the time when the Notes are admitted to
listing;
(c) as at the date hereof, it has not, since the last publication of
information in compliance with the listing rules of the Luxembourg Stock
Exchange about the Programme, any previous issues made under the Programme
and listed on the Luxembourg Stock Exchange, or any Notes falling within
regulation 13(4)(a) or (b) of the Banking Act 1987 (Exempt Transactions)
Regulations 1997, having made all reasonable enquiries, become aware of any
change in circumstances which could reasonably be regarded as significantly
and adversely affecting its ability to meet its obligations as issuer in
respect of such Notes as they fall due; and
(d) as at the date hereof, it has complied with and will continue to comply
with, its obligations under the Banking Act 1987 (Exempt Transactions)
Regulations 1997 to lodge all relevant information in relation to the Notes
with the London Stock Exchange.
RESPONSIBILITY
The Issuer and the Guarantor accept responsibility for the information appearing
in this Pricing Supplement.
THE ISSUER
TXU EASTERN FUNDING COMPANY
By: Howard Goodbourn
Duly authorised signatory
THE GUARANTOR
TXU EUROPE LIMITED
By: Howard Goodbourn
Duly authorised signatory