Document:

exhibit 10(xx)

 

Exhibit
10(xx)

 

 

Dated
27 January 2005

 

 

Between

 

THE
HOLDING COMPANIES

 

TXU
CORP.

 

THE
CORP PERSONS

 

THE
TXUE PERSONS

 

and

 

THE
KPMG OFFICEHOLDERS

 

___________________________________

SETTLEMENT
AGREEMENT

____________________________________

Cadwalader

Cadwalader,
Wickersham & Taft LLP

265
Strand

London,
WC2R 1BH

Tel: +44
(0) 20 7170 8700

Fax: +44
(0) 20 7170 8600

Ref:
95977.001/JD/YC

 

	 	
       

      TABLE
      OF CONTENTS
	 
	 	 	
       

      Page

	
       

      1
	
       

      INTERPRETATION
	
       

      2

	
       

      2
	
       

      SETTLEMENT
	
       

      7

	
       

      3
	
       

      RELEASES
	
       

      8

	
       

      4
	
       

      CONDITIONS
	
       

      9

	
       

      5
	
       

      EXCLUDED
      COMPANIES
	
       

      10

	
       

      6
	
       

      WARRANTIES
	
       

      11

	
       

      7
	
       

      EXCLUSION
      OF LIABILITY
	
       

      11

	
       

      8
	
       

      FURTHER
      ASSURANCE
	
       

      12

	
       

      9
	
       

      NO
      RIGHT OF SET-OFF
	
       

      12

	
       

      10
	
       

      VALUE
      ADDED TAX
	
       

      12

	
       

      11
	
       

      WITHHOLDING
      TAX
	
       

      13

	
       

      12
	
       

      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT
	
       

      13

	
       

      13
	
       

      MISCELLANEOUS
	
       

      14

	
       

      14
	
       

      COSTS
	
       

      15

	
       

      15
	
       

      NOTICES
	
       

      15

	
       

      16
	
       

      GOVERNING
      LAW AND JURISDICTION
	
       

      16

	
       

      Schedule
      1 The Holding Companies
	
       

      23

	
       

      Schedule
      2 The Corp Persons
	
       

      29

	
       

      Schedule
      3 The TXUE Persons
	
       

      30

	
       

      Schedule
      4 The Operating Companies
	
       

      31

	
       

      Schedule
      5 Excluded Companies
	
       

      36

	
       

      Schedule
      6 Operating Company Deed of Release
	
       

      41

	
       

      Schedule
      7 Excluded Company Deed of Release
	
       

      61

	
       

      Schedule
      8 Terms of Holding Company CVA Creditor Release
	
       

      71

	
       

      Schedule
      9 Principal Creditors
	
       

      72

	
       

      Schedule
      10 Principal Creditor Deed of Release
	
       

      73

-i-

 

THIS
AGREEMENT is made
this 27th day of January 2005

 

BETWEEN:

 

	(1)  	
      The
      companies named in Schedule 1 hereto (the “Holding
      Companies”),
      each acting by the respective officeholders named in Schedule 1, as agents
      without personal liability (collectively, the “KPMG
      Officeholders”);

 

	(2)  	
      TXU
      Corp., a
      corporation incorporated under the laws of Texas in the United States of
      America and having its registered office at Energy Plaza, 1601 Bryan
      Street, Dallas, Texas 75201, USA (“Corp”);

 

	(3)  	
      The
      past or present directors, officers and employees of Corp named in
      Schedule 2 hereto, acting solely in their respective capacities as such
      (the “Corp
      Persons”);

 

	(4)  	
      The
      past or present directors, officers, employees and advisers of the Holding
      Companies and the Operating Companies named in Schedule 3 hereto, acting
      solely in their respective capacities as such (the “TXUE
      Persons”);
      and

 

	(5)  	
      The
      KPMG Officeholders.

 

WHEREAS:

 

	(A)  	
      Capitalised
      terms used but not defined in these recitals have the respective meanings
      set out above or in Clause 1.1 of this
Agreement.

 

	(B)  	
      Each
      of the Holding Companies entered either administration or liquidation
      proceedings, as the case may be, on the date specified in Schedule 1, and
      presently acts by its respective KPMG
Officeholders.

 

	(C)  	
      Each
      of the companies named in the table set out in Schedule 4 (the
      “Operating
      Companies”)
      entered either administration or liquidation proceedings, as the case may
      be, on the date specified in Schedule 4, and presently acts by the
      respective administrators or liquidators specified therein (collectively,
      the “Operating
      Company Officeholders”).

 

	(D)  	
      The
      Operating Company Officeholders have issued proposals, dated 10 January
      2005, for CVAs for each of the Operating Companies (the “Operating
      Company CVAs”),
      each to be considered by meetings of members and creditors to be convened
      on 28 January 2005.

 

	(E)  	
      The
      KPMG Officeholders intend to propose CVAs for certain of the Holding
      Companies, including the Core Holding
      Company CVAs,
      each to
      be considered by meetings of members and creditors to be convened on or
      before 30 April 2005.

 

	(F)  	
      Certain
      of the Holding Companies and the Operating Companies have put Corp,
      certain of the Corp Persons and certain of the TXUE Persons on notice of
      claims any or all of them have or may have against any or all of Corp, the
      Corp Persons and the TXUE Persons. Each
      of Corp, the Corp Persons and the TXUE Persons denies liability in respect
      of all such claims.

1

 

 

	(G)  	
      Corp
      has put the KPMG Officeholders on notice of a claim it has or may have for
      interest payable in respect of the Share Alternative
  Notes.

 

	(H)  	
      The
      parties wish to agree a full and final settlement for all purposes on the
      terms and conditions set out in this Agreement of all matters arising out
      of or in relation to the conduct of Corp, the Corp Persons, the TXUE
      Persons, the TXUE Third Parties and the Corp Third Parties in connection
      with the business or affairs of any member of the TXUE Group and all
      losses and potential losses suffered or alleged to be suffered by any
      member of the TXUE Group or its creditors.

 

NOW
IT IS AGREED as
follows:

 

	1  	
      INTERPRETATION

 

	1.1  	
      In
      this Agreement (including its recitals), unless the context otherwise
      requires, the following words and expressions shall have the following
      respective meanings:

 

“Business
Day” means
any day (except a Saturday or a Sunday) on which commercial banks and foreign
exchange markets are open for general business in the City of
London;

 

“Claims” means,
in connection with the business or affairs of any member of the TXUE Group, any
or all claims and applications (whether they are or may become vested in any
member of the TXUE Group, any Officeholder, any CVA Creditor or any other
person, and whether they are or may become vested by way of present or future
assignment or otherwise) that any person owes any obligation or should be
required to make any payment or do any act or is under any liability to another
person (including any claim or application for indemnity or contribution)
whether or not, as at the date of this Agreement, such claim, application,
obligation, requirement or liability is actual or alleged, known or unknown,
notified or not notified, whether or not it is present, future, prospective, or
contingent, whether or not its amount is fixed or liquidated, whether or not it
is admitted or disputed, whether or not it involves the payment of money or
performance, whether it is secured or unsecured, whether it arises by virtue of
common law, equity or statute, whether or not it relates to a substantive or
procedural right or power including a right or power to pursue any Statutory
Claim, whether or not it arises under English law, Dutch law or the law of any
other jurisdiction, whether or not it arises in England or any other
jurisdiction and whether or not it exists in law as at the date of this
Agreement, but in each case excluding any claim or application arising under
this Agreement, the Tax Cooperation Agreement or any Deed of
Release;

 

“Core Holding
Company CVAs” means
CVAs to be proposed for TXUEL, TXU Acquisitions, EH3, EGO BV, TEG and Eastern
Funding;

 

“Core
Operating Company CVAs” means
the Operating Company CVAs proposed for TXUEG, TXU EET, TXU UK, TXU Europe Power
Limited (in administration), EGFL, TXU Europe Merchant Properties Limited (in
liquidation), TXU (UK) Holdings, Energy Holdings (No. 6) Limited (in
administration), Eastern Electricity Holdings Limited (in administration), TXU
Germany Limited (in liquidation), TXU Europe (Blade) Limited (in liquidation),
TXU Europe (Blade No. 2) Limited (in liquidation) and TXU Direct Sales Limited
(in liquidation);

 

2

“Corp Subsidiary” means a
Subsidiary of Corp that is not a member of the TXUE Group;

 

“Corp Third
Party” means
any (i) Corp Subsidiary and (ii) past or present director, officer, employee,
auditor, agent or adviser of or to Corp or a Corp Subsidiary, in each case
acting solely in its capacity as such, who is not a Corp Person; 

 

“CVA” means a
company voluntary arrangement under Part I of the Insolvency Act which is
binding upon all of the creditors of the relevant company in accordance with the
Insolvency Act;

 

“CVA
Creditor” means
any person acting solely in its capacity as a creditor of a Holding Company or
an Operating Company, who is or becomes bound in that capacity by a CVA that
contains a CVA Creditor Release;

 

“CVA
Creditor Release”
means:

 

	(a)  	
      with
      respect to a Holding Company, terms of a CVA substantially the same as
      those set out in Schedule 8; and

 

	(b)  	
      with
      respect to an Operating Company, terms of a CVA identical to those set out
      in Clauses 33.4 to 33.6 of the Operating Company CVAs in the form
      contained in the proposals for the Operating Company CVAs issued on 10
      January 2005;

 

“Deed
of Release” means
any Excluded Company Deed of Release, Operating Company Deed of Release or
Principal Creditor Deed of Release; 

 

“Designated
Account” means
the account at Bank of Ireland, 20 Berkeley Square, London W1J 6LL (sort code:
30-16-07, account no: 86279574 and account name: JR Tucker and PW Wallace, Joint
Administrators TXU Europe Limited);

 

“Eastern
Funding” means
TXU Eastern Funding Company (in administration), a company incorporated in
England and Wales with company number 03710529, acting by its joint
administrators as agents without personal liability and having its registered
office at 8 Salisbury Square, London EC4Y 8BB;

 

“Effective
Date” means
the first Business Day on which all of the conditions set out in Section 4 are
and remain fully and irrevocably satisfied or waived in accordance with Section
4;

 

“EGFL” means
Eastern Group Finance Limited (in liquidation), a company incorporated in
England and Wales with company number 02937764, acting by its joint liquidators
as agents without personal liability and having its registered office at 8
Salisbury Square, London EC4Y 8BB;

 

“EGO
BV” means
Energy Group Overseas B.V. (in administration), a company incorporated in the
Netherlands with company number 33296337, acting by its joint administrators as
agents without personal liability and having its registered office at De
Boelelaan 7, Amsterdam, 1083 HJ, Netherlands;

 

3

“EH3” means
Energy Holdings (No. 3) Limited (in liquidation), a company incorporated in
England and Wales with company number 03257256, acting by its joint liquidators
as agents without personal liability and having its registered office at 8
Salisbury Square, London EC4Y 8BB;

 

“E&Y” means
Ernst & Young LLP, of 1 More London Place, London SE1 2AF; 

 

“Excluded
Company” means
(i) each of the companies in the TXUE Group named in the table set out in
Schedule 5 and (ii) any Operating Company in respect of which, immediately
following the last occurring Implementation Date in respect of the Core
Operating Company CVAs, no Implementation Date for a CVA has
occurred;

 

“Excluded
Company Deed of Release” means a
deed of release between (i) one or more Excluded Companies and their respective
Excluded Company Officeholders (if any), (ii) TXUEL and the TXUEL Officeholders
and (iii) Corp, in substantially the form set out in Schedule 7;

 

“Excluded
Company Officeholder” means
any liquidator, scheme administrator, CVA supervisor, administrative receiver or
other appointed officeholder of an Excluded Company, in each case acting solely
in its capacity as such;

 

“Excluded
Company Third Party” means
(i) any past or present director, officer, employee, auditor, agent or adviser
of or to an Excluded Company and (ii) any creditor of an Excluded Company, in
each case acting solely in its capacity as such;

 

“Finco
2” means
TXU Finance (No. 2) Limited (in administration), a company incorporated in
England and Wales with company number 03514100, acting by its joint
administrators as agents without personal liability and having its registered
office at 8 Salisbury Square, London EC4Y 8BB;

 

“German
Finance” means TXU
Europe German Finance B.V. (in liquidation), a company incorporated in the
Netherlands with company number 27251472, acting by its joint liquidators as
agents without personal liability and having its registered office at
Koninginnegracht 15 2514 AB, The Hague, Netherlands;

 

“German
Finance Officeholders” means
the joint liquidators of German Finance, each acting as agent without personal
liability;

 

“Holding
Company CVA”
means a
CVA in
respect of a Holding Company;

 

“Implementation
Date” means,
with respect to any Holding Company CVA or Operating Company CVA, the date on
which all conditions with respect to its effectiveness are fully and irrevocably
satisfied or waived and (i) the prescribed period for an application under
sections 4A(3) or 6 of the Insolvency Act or rule 1.17A(3) of the Insolvency
Rules 1986 (calculated by reference to sections 6(3)(a) and 4A(4) of the
Insolvency Act and rule 1.17A(6) of the Insolvency Rules 1986) or any appeal in
respect of such application has expired; (ii) if an application under sections
4A or 6 of the Insolvency Act or rule 1.17A(3) of the Insolvency Rules 1986 has
been served or an appeal in respect of such application has been made prior to
the expiry of such period, such application or appeal has been dismissed or
withdrawn; and (iii) any court sanction required by law in order to give effect
to the relevant CVA has been granted and the period for any appeal has expired
or any such appeal has been dismissed or withdrawn;

 

4

“Insolvency
Act” means
the Insolvency Act 1986;

 

“Ireland
1” means
TXU Europe Ireland 1 (in liquidation), a company incorporated in Ireland with
company number 316371, acting by its joint liquidators as agents without
personal liability and having its registered office at Wilton Place, Dublin 2,
Ireland;

 

“Ireland
1 Officeholders” means
the joint liquidators of Ireland 1, each acting as agent without personal
liability;

 

“KPMG” means
KPMG LLP, of 8 Salisbury Square, London EC4Y 8BB;

 

“Officeholders” means
(i) the KPMG Officeholders, (ii) the Operating Company Officeholders, (iii) the
Excluded Company Officeholders, (iv) the predecessors of each of them and (v) in
the event of a subsequent liquidation, scheme of arrangement or company
voluntary arrangement of or in relation to any of the Holding Companies, the
Operating Companies or the Excluded Companies, any liquidator, scheme
administrator, CVA supervisor or other appointed officeholder in respect of any
such company; 

 

“Operating
Companies” has the
meaning set out in the recitals hereto;

 

“Operating
Company CVAs” has the
meaning set out in the recitals hereto;

 

“Operating
Company Deed of Release” means a
deed of release between (i) each Operating Company (save any
Operating Company to whom, by virtue of Clause 2.5 of the Operating Company Deed
of Release, the terms of such Deed of Release will not apply) and its
respective Operating Company Officeholders, (ii) Ireland 1 and the Ireland 1
Officeholders, (iii) German Finance and the German Finance Officeholders, (iv)
TXUEL and the TXUEL Officeholders, and (v) Corp, in substantially the form set
out in Schedule 6;

 

“Operating
Company Officeholder” has the
meaning set out in the recitals hereto;

 

“Principal
Creditor” means
each institution, being a creditor of one or more of the Holding Companies
acting solely in its capacity as such, named in Schedule 9;

 

“Principal
Creditor Deed of Release” means a
deed of release between (i) one or more of the Principal Creditors, (ii) the
TXUE Persons as at the date hereof, (iii) the Corp Persons as at the date hereof
and (iv) Corp, in substantially the form set out in Schedule 10;

 

“Reimbursement
Sums” means
(i) the sum of £680,553.03 in
respect of pre-administration fees paid by or on behalf of one or more of the
Holding Companies to Lovells and (ii) the sum of US$2,857,552.59 in respect of
the rebate of certain insurance premia to TXUEG, each to be
paid by Corp pursuant to Section 2;

 

“Settlement
Sum” means
the sum of US$205,000,000 to be paid by Corp pursuant to Section 2;

 

5

“Share
Alternative Notes” means
the notes issued pursuant to an investment agreement between Corp, Finco 2, TXU
Acquisitions and others dated 2 March 1998, as amended;

 

“Statutory
Claims” means
any Claims brought pursuant to sections 212 to 215, 235, 236, 238 to 245 or 423
to 425 of the Insolvency Act, or any substantially similar Claims vested in an
Officeholder or a general body of creditors under the insolvency laws of any
jurisdiction, against any of Corp, the Corp Persons, the Corp Third Parties, the
TXUE Persons and the TXUE Third Parties;

 

“Subsidiary” means a
subsidiary within the meaning of section 736 of the Companies Act
1985;

 

“Tax
Cooperation Agreement” means
the deed between
Corp, TXUEL, Finco 2, TXU Acquisitions and others dated 31 December 2004, as
amended from time to time;

 

“TEG” means
The Energy Group Limited (in administration), a company incorporated in England
and Wales with company number 03613919, acting by its joint administrators as
agents without personal liability and having its registered office at 8
Salisbury Square, London EC4Y 8BB; 

 

“TXU
Acquisitions” means
TXU Acquisitions Limited (in administration), a company incorporated in England
and Wales with company number 03455523, acting by its joint administrators as
agents without personal liability and having its registered office at 8
Salisbury Square, London EC4Y 8BB; 

 

“TXU
EET” means
TXU Europe Energy Trading Limited (in administration), a company incorporated in
England and Wales with company number 03116221, acting by its joint
administrators as agents without personal liability and having its registered
office at 1 More London Place, London SE1 2AF;

 

“TXUEG” means
TXU Europe Group plc (in administration), a company incorporated in England and
Wales with company number 03247622, acting by its joint administrators as agents
without personal liability and having its registered office at 1 More London
Place, London SE1 2AF;

 

“TXUEG
Group” means
TXUEG and its Subsidiaries;

 

“TXUE
Group” means
the TXUEL Group and the TXUEG Group;

 

“TXUEL” means
TXU Europe Limited (in administration), a company incorporated in England and
Wales with company number 03505836, acting by its joint administrators as agents
without personal liability and having its registered office at 8 Salisbury
Square, London EC4Y 8BB; 

 

“TXUEL
Group” means
TXUEL and its Subsidiaries, excluding the companies in the TXUEG
Group;

 

“TXUEL
Officeholders” means
the KPMG Officeholders of TXUEL, each acting as agent without personal
liability;

 

6

“TXUE
Third Party” means,
excluding any Excluded Company Third Party, any past or present director,
officer, employee, auditor, agent or adviser of or to a Holding Company or an
Operating Company, in each case acting solely in its capacity as such, who is
not a TXUE Person;

 

“TXU
UK” means
TXU UK Limited (in administration), a company incorporated in England and Wales
with company number 02937796, acting by its joint administrators as agents
without personal liability and having its registered office at 1 More London
Place, London SE1 2EF;

 

“TXU
(UK) Holdings” means
TXU (UK) Holdings Limited (in administration), a company incorporated in England
and Wales with company number 02907433, acting by its joint administrators as
agents without personal liability and having its registered office at 1 More
London Place, London SE1 2AF;

 

“US$” means
the dollar currency of the United States; and 

 

“VAT” means
value added tax as provided for in the Value Added Tax Act 1994.

 

	1.2  	
      References
      herein to any numbered Section, Part, Clause, Schedule or Annex without
      further designation shall, unless the context otherwise requires, be
      construed as a reference to the section, part or clause of or schedule or
      annex to this Agreement as so numbered.

 

	1.3  	
      Schedules
      and Annexes to this Agreement form part of and are deemed to be
      incorporated in this Agreement.

 

	1.4  	
      Section
      headings of and in any Schedule or Annex to this Agreement are for
      convenience only and shall not be taken into account in the interpretation
      of this Agreement.

 

	1.5  	
      References
      in this Agreement to any statute or statutory provision shall mean that
      statute or statutory provision as amended and in force as at the date of
      this Agreement.

 

	1.6  	
      Words
      used in this Agreement importing the plural shall include the singular and
      vice
      versa.

 

	1.7  	
      The
      term “person” when used in this Agreement shall include an individual, a
      firm, a body corporate, an unincorporated association, a partnership and a
      person’s legal personal representatives or
successors.

 

	1.8  	
      Statements
      contained in the recitals to this Agreement shall be considered in the
      interpretation of this Agreement.

 

	2  	
      SETTLEMENT 

 

	2.1  	
      In
      consideration of the releases, waivers and discharges to be given under
      Clauses 3.3 and 3.4, and subject to the occurrence of the Effective Date,
      Corp shall, within seven Business Days of the Effective Date, pay the
      Settlement Sum and the Reimbursement Sums by
      way of bank transfer to the Designated Account.

 

7

	3  	
      RELEASES

 

	3.1  	
      The
      terms of this Section 3 shall become effective subject to and immediately
      upon receipt of the Settlement Sum and the Reimbursement Sums in
      accordance with Section 2.

 

	3.2  	
      In
      consideration of the releases, waivers and discharges to be given to them
      hereunder, each of Corp and the Corp Persons hereby irrevocably releases,
      waives and discharges any and all Claims (including, for the avoidance of
      doubt, any Claims in respect of the Share Alternative Notes that are not
      released pursuant to the terms of the CVA for TXU Acquisitions) it has or
      may have against any or all of: 

 

	3.2.1  	
      the
      Holding Companies;

 

	3.2.2  	
      the
      Operating Companies, Ireland 1, German Finance and each of their
      respective Officeholders, provided in each case that such party has
      executed and is bound by the Operating Company Deed of
      Release;

 

	3.2.3  	
      the
      TXUE Persons;

 

	3.2.4  	
      the
      TXUE Third Parties;

 

	3.2.5  	
      the
      CVA Creditors; and 

 

	3.2.6  	
      the
      KPMG Officeholders and their predecessors (if
any).

 

	3.3  	
      In
      consideration of receipt of the Settlement Sum and the Reimbursement Sums
      and the releases, waivers and discharges given to them hereunder, each of
      the Holding Companies and its respective KPMG Officeholders hereby
      irrevocably releases, waives and discharges any and all Claims it has or
      may have against any or all of:

 

	3.3.1  	
      the
      TXUE Persons;

 

	3.3.2  	
      the
      TXUE Third Parties;

 

	3.3.3  	
      Corp;

 

	3.3.4  	
      the
      Corp Persons; and

 

	3.3.5  	
      the
      Corp Third Parties.

 

	3.4  	
      In
      consideration of the releases, waivers and discharges given to them
      hereunder, each of the TXUE Persons hereby irrevocably releases, waives
      and discharges any and all Claims it has or may have against any or all
      of:

 

	3.4.1  	
      the
      Holding Companies;

 

	3.4.2  	
      the
      Operating Companies, Ireland 1, German Finance and each of their
      respective Officeholders, provided in each case that such party has
      executed and is bound by the Operating Company Deed of
      Release;

 

	3.4.3  	
      all
      other TXUE Persons;

 

8

	3.4.4  	
      the
      TXUE Third Parties;

 

	3.4.5  	
      the
      Corp Persons;

 

	3.4.6  	
      the
      Corp Third Parties;

 

	3.4.7  	
      the
      CVA Creditors; and

 

	3.4.8  	
      the
      KPMG Officeholders and their predecessors (if
any).

 

	3.5  	
      Subject
      to the consent in writing of (i) the TXUEL Officeholders and (ii) Corp,
      during the period between the execution of this Agreement and the
      Effective Date, additional persons may be added to the lists of Corp
      Persons and TXUE Persons set out in Schedules 2 and 3, as the case may be.
      Such persons will, as a result of and with effect from such addition,
      become parties to this Agreement.

 

	4  	
      CONDITIONS

 

	4.1  	
      Corp’s
      obligation to pay the Settlement Sum and the Reimbursement Sums shall be
      subject to the following conditions having been fully and irrevocably
      satisfied, or having been waived in accordance with Clause 4.2, on or
      before the earlier of (i) 30 November 2005 and (ii) the making of any
      announcement or giving of any notice by the KPMG Officeholders of an
      intention not to proceed with the Core Holding Company
    CVAs:

 

	4.1.1  	
      the
      full and irrevocable satisfaction of all conditions to the occurrence of
      an Implementation Date in respect of each Core Holding Company CVA, save
      for payment of the Settlement Sum and the Reimbursement
    Sums;

 

	4.1.2  	
      an
      Implementation Date having occurred in respect of each Core Operating
      Company CVA;

 

	4.1.3  	
      the
      inclusion of a CVA Creditor Release in (i) the terms as approved of each
      Operating Company CVA in respect of which an Implementation Date has
      occurred prior to or upon the last occurring Implementation Date in
      respect of the Core Operating Company CVAs; (ii) the terms as approved of
      each Holding Company CVA in respect of which the conditions to the
      occurrence of an Implementation Date (save for the payment of the
      Settlement Sum and the Reimbursement Sums) have been fully and irrevocably
      satisfied as at the satisfaction or waiver of the condition set out in
      Clause 4.1.1; and (iii) the terms (as then proposed) of any other Holding
      Company CVA that is the subject of proposals pending as at the
      satisfaction or waiver of the condition set out in Clause
      4.1.1;

 

	4.1.4  	
      the
      execution and delivery to Corp of the Operating Company Deed of Release by
      all parties thereto (save any Operating Company to whom, by virtue of
      Clause 2.5 of the Operating Company Deed of Release, the terms of such
      Deed of Release will not apply);

 

	4.1.5  	
      the
      execution and delivery to Corp of a Principal Creditor Deed of Release by
      each of the Principal Creditors; and

 

9

	4.1.6  	
      final
      injunctions having been obtained in ancillary proceedings under section
      304 of the United States Bankruptcy Code in respect of (i) each Core
      Holding Company CVA and (ii) CVAs for TXU EET, TXU UK, TXUEG, EGFL and TXU
      (UK) Holdings.

 

	4.2  	
      The
      provisions of:

 

	4.2.1  	
      Clause
      4.1.1 may be waived, with respect to any Core Holding Company CVA, either
      (i) by written agreement between Corp and the relevant Holding Company, or
      (ii) by written agreement between Corp and each other Holding Company in
      respect of which a Core Holding Company CVA is being proposed (and in
      respect of which no such waiver is being made or proposed), provided that,
      in the event of and with effect from such waiver as specified in (ii), and
      notwithstanding any provision of this Agreement to the contrary, the terms
      of this Agreement (including for the avoidance of doubt Section 3) shall
      not apply to the Holding Company in respect of which the waiver is
      given;

 

	4.2.2  	
      Clause
      4.1.2 may be waived by written agreement between the KPMG Officeholders
      and Corp; and

 

	4.2.3  	
      Clauses
      4.1.3 to 4.1.6 inclusive (or any part of them) may be waived by Corp by
      written notice to the KPMG Officeholders.

 

	5  	
      EXCLUDED
      COMPANIES

 

	5.1  	
      In
      consideration of, and as soon as practicable following, the execution and
      delivery to them of an Excluded Company Deed of Release by any Excluded
      Company and its Officeholders (if any), each of TXUEL, the TXUEL
      Officeholders and Corp agrees also to execute such Excluded Company Deed
      of Release.

 

	5.2  	
      In
      consideration of, subject to and immediately upon the later of (i) the
      execution and delivery of an Excluded Company Deed of Release by any
      Excluded Company and its Officeholders (if any) and each of TXUEL, the
      TXUEL Officeholders and Corp; and (ii) the full and irrevocable
      satisfaction of all conditions to its effectiveness, each of Corp, the
      Corp Persons and the TXUE Persons hereby, without further action,
      irrevocably releases, waives and discharges any and all Claims it has or
      may have against any or all of: 

 

	5.2.1  	
      such
      Excluded Company;

 

	5.2.2  	
      its
      Excluded Company Officeholders and their predecessors (in each case if
      any); and

 

	5.2.3  	
      subject
      to Clause 5.3, its Excluded Company Third
Parties.

 

	5.3  	
      No
      creditor of an Excluded Company acting solely in its capacity as such
      shall be entitled to the benefit of the releases, waivers and discharges
      given in Clause 5.2 upon the conditions set out therein unless and until
      it is finally bound, whether directly or by a CVA or otherwise, by terms
      that are substantially the same as those set out in Schedule
      8.

 

10

	6  	
      WARRANTIES

 

	6.1  	
      Corp
      hereby represents, warrants and undertakes
that:

 

	6.1.1  	
      it
      has the power, capacity and authority to enter into this Agreement and to
      exercise its rights and perform its obligations hereunder and that all
      corporate and other action required to authorise the execution of this
      Agreement and the performance of its obligations hereunder has been duly
      taken;

 

	6.1.2  	
      it
      has, or has provided, all consents and any other necessary authorisations
      and approvals required to enable it or its authorised representative
      lawfully to enter into, execute, perform and comply with its obligations
      under this Agreement and such authorisations, consents and approvals are
      in full force and effect;

 

	6.1.3  	
      to
      the best of its knowledge, information and belief, no steps have been
      taken for the revocation or cancellation of any necessary consents,
      authorisations and approvals; 

 

	6.1.4  	
      all
      other acts, conditions and things required to be done, fulfilled and
      performed in order (i) to enable it lawfully to enter into and to exercise
      its rights under and perform the obligations assumed by it in this
      Agreement and (ii) to ensure that the obligations expressed to be assumed
      by it in the Agreement are legal, valid and binding have been done,
      fulfilled and performed; and

 

	6.1.5  	
      it
      has not entered into any pending agreements, transactions or negotiations
      that would render this Agreement, or any part of it, void, voidable or
      unenforceable.

 

	6.2  	
      Each
      of the Corp Persons and the TXUE Persons represents, warrants and
      undertakes that:

 

	6.2.1  	
      it
      has the necessary power, capacity and authority to execute (including,
      where applicable, on behalf of other parties to this Agreement) and
      perform its obligations under this Agreement;
and

 

	6.2.2  	
      this
      Agreement is valid and binding upon it in accordance with its
      terms.

 

	6.3  	
      Each
      of the parties acknowledges and agrees that, save as expressly referred to
      herein, in entering into this Agreement it has not relied on any
      statement, representation or silence of any other party to this
      Agreement.

 

	7  	
      EXCLUSION
      OF LIABILITY 

 

	7.1  	
      The
      Parties to this Agreement acknowledge and agree
that:

 

	7.1.1  	
      the
      KPMG Officeholders act at all times solely as agents of the Holding
      Companies, in each case without personal
liability;

 

11

 

 

	7.1.2  	
      none
      of the KPMG Officeholders nor their firm, fellow members, partners,
      employees, agents, advisers or representatives shall incur any personal
      liability under, or by virtue of this Agreement, nor in relation to any
      related matter or claim howsoever, whenever and wherever arising, and
      whether such claim is formulated in contract and/or tort or by reference
      to any other remedy or right, and in whatever jurisdiction or
      forum;

 

	7.1.3  	
      none
      of the KPMG Officeholders nor their firm, fellow members, partners,
      employees, agents, advisers or representatives has given or entered into
      any collateral undertakings, representations, warranties or agreements as
      principal in connection with this Agreement;

 

	7.1.4  	
      the
      KPMG Officeholders are a party to this Agreement in their personal
      capacities solely for the purpose of receiving the benefit of the
      exclusions, limitations, undertakings, covenants and releases in their
      favour as provided in this Agreement; and

 

	7.1.5  	
      nothing
      in this Agreement shall operate to restrict or affect in any way any right
      of the KPMG Officeholders to an indemnity or assurance to which by law the
      KPMG Officeholders are entitled.

 

	8  	
      FURTHER
      ASSURANCE

 

Each
party shall at its own cost do and execute or procure to be done and executed
all necessary acts, deeds, documents and things reasonably within its power to
give effect to this Agreement.

 

	9  	
      NO
      RIGHT OF SET-OFF

 

Except as
provided herein, any payments agreed to be made pursuant to this Agreement shall
be made in full without deduction, set-off, retention or counterclaim, any right
to which is expressly waived by Corp.

 

	10  	
      VALUE
      ADDED TAX

 

	10.1  	
      All
      amounts expressed in this Agreement as payable by Corp are expressed
      exclusive of any VAT which may be chargeable thereon.

 

	10.2  	
      In
      the event that any VAT is properly chargeable on any amount paid by Corp
      hereunder:

 

	10.2.1  	
      the
      amount paid by Corp shall be exclusive of VAT which will be charged in
      addition hereto, provided that Corp shall have no obligation to pay any
      amount in respect of such VAT, unless and until it has recovered an amount
      equal to such VAT;

 

	10.2.2  	
      if
      the TXUEL Officeholders so request and Corp agrees (such agreement not to
      be unreasonably withheld or delayed), Corp shall appoint KPMG as its agent
      for the purposes of making any claim for a refund under the provisions of
      the Thirteenth VAT Directive, provided that KPMG shall in performing such
      agency take into account any reasonable comments made by Corp in relation
      to any step required in order to claim the refund;
and

 

12

	10.2.3  	
      otherwise,
      Corp agrees that it shall take all reasonable steps to procure the
      repayment of such VAT, including the making of a claim for a refund under
      the provisions of the Thirteenth VAT
Directive.

 

	11  	
      WITHHOLDING
      TAX

 

	11.1  	
      All
      amounts payable by Corp under Section 2 of this Agreement shall be paid
      free and clear of any deduction for income taxes and withholding taxes. If
      such income taxes or withholding taxes are required by law, the amount of
      the payment due shall be increased to an amount which (after any income
      taxes or withholding taxes) leaves an amount equal to the payment which
      would have been due if no income taxes or withholding taxes had been
      required.

 

	11.2  	
      To
      the extent that any such withholding taxes could be reduced or eliminated
      by the provision of appropriate withholding certificates, TXUEL and the
      TXUEL Officeholders shall cooperate in obtaining and providing such
      certificates.

 

	11.3  	
      To
      the extent that the Settlement Sum or the Reimbursement Sums are increased
      as a result of Clause 11.1, TXUEL and any other Holding Company receiving
      (whether directly or indirectly) such amounts will notify Corp of the
      existence of any potential claim for refund of any amount of the increase
      that is available to them, will use its reasonable efforts to pursue a
      claim for refund of such amount from the relevant tax authority at the
      direction and expense of Corp and will remit any amounts refunded
      (including interest earned thereon, net of any tax suffered) to
      Corp.

 

	11.4  	
      TXUEL
      and the TXUEL Officeholders shall use reasonable efforts at the direction
      and expense of Corp to procure the cooperation of any CVA Creditor who may
      be in a position to obtain and provide such certificates as are specified
      in Clause 11.2 or claim for and remit such refunds as are specified in
      Clause 11.3.

 

	11.5  	
      Corp
      and the Holding Companies agree that no amounts payable by Corp under
      Sections 2 or 11 of this Agreement have been paid in consideration of
      services performed in the United States of
America.

 

	12  	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT 

 

	12.1  	
      It
      is expressly intended and agreed by the parties
that:

 

	12.1.1  	
      each
      TXUE Third Party;

 

	12.1.2  	
      each
      Corp Third Party;

 

	12.1.3  	
      each
      Operating Company;

 

	12.1.4  	
      each
      Officeholder;

 

	12.1.5  	
      each
      Excluded Company; 

 

13

	12.1.6  	
      each
      Excluded Company Third Party; and

 

	12.1.7  	
      each
      CVA Creditor, 

 

shall be
entitled in its own right to enforce such releases, waivers and discharges as
may be given to it and become effective under the terms of Section 3 or Section
5, as the case may be, by virtue of and in accordance with the Contracts (Rights
of Third Parties) Act 1999.

 

	12.2  	
      With
      the exception of the persons referred to in Clause 12.1, a person who is
      not a party to this Agreement may not enforce any of its terms under the
      Contracts (Rights of Third Parties) Act
1999.

 

	12.3  	
      No
      consent of any third party (including for the avoidance of doubt, any
      person referred to in Clause 12.1) shall be required to amend, waive or
      substitute or supplement any provisions of this
  Agreement.

 

	12.4  	
      Unless
      agreed otherwise pursuant to a Deed of Release, the parties to this
      Agreement may rescind or vary the Agreement or any of its terms without
      the consent of any person referred to in Clause 12.1, even if the rights
      of any such person under Clause 12.1 shall, by reason of such rescission
      or variation, be extinguished or altered. 

 

	13  	
      MISCELLANEOUS

 

	13.1  	
      This
      Agreement constitutes the whole agreement between the parties hereto
      relating to its subject matter. 

 

	13.2  	
      This
      Agreement supersedes any other agreement or arrangement entered into
      between the parties with respect to the subject matter
    hereof.

 

	13.3  	
      If
      any term of this Agreement is deemed illegal, invalid or unenforceable in
      any jurisdiction, that shall not affect:

 

	13.3.1  	
      the
      legality, validity or enforceability in that jurisdiction of any other
      term of this Agreement; or

 

	13.3.2  	
      the
      legality, validity or enforceability in other jurisdictions of that term
      or any other term of this Agreement.

 

	13.4  	
      This
      Agreement shall be binding upon and inure for the benefit of the parties
      hereto, their successors and assigns. It is the intention of the parties
      hereto that this Agreement shall be binding to the maximum extent
      permitted by law upon their successors and assigns, an appointed
      liquidator for any such companies or other trustee or agent for creditors
      in connection with any insolvency proceedings.

 

	13.5  	
      Subject
      to Clause 3.5 herein, this Agreement may not be modified, amended or
      supplemented except as may be agreed and made in writing signed by or on
      behalf of each of the parties hereto. 

 

14

	13.6  	
      This
      Agreement may be executed in two or more counterparts each of which shall
      be deemed to be an original and which together shall constitute one and
      the same agreement.

 

	13.7  	
      Except
      as set out in this Clause 13.7, no public announcement of the terms of
      this Agreement or its implementation shall be made save in terms agreed
      between Corp and the KPMG Officeholders. Each party to this Agreement
      agrees that it will make no public comment of a disparaging nature in
      relation to any other party in connection with the business or affairs of
      any member of the TXUE Group. The parties to this Agreement acknowledge
      that Corp will have an entitlement to file a copy of this Agreement with
      the Securities and Exchange Commission, and that the Operating Companies
      and the Holding Companies will be entitled to make appropriate disclosure
      as part of their CVA documentation and to creditors’ committees and
      meetings of creditors and members and as otherwise required by law. The
      Holding Companies agree to use reasonable endeavours to consult with Corp
      with respect to the terms of any such disclosure to be made by them as
      part of their CVA documentation.

 

	14  	
      COSTS

 

The
parties shall each bear their own costs in connection with the preparation,
negotiation, execution and implementation of this Agreement.

 

	15  	
      NOTICES

 

	15.1  	
      Any
      notice under this Agreement shall be given by being duly transmitted to
      the following address by facsimile
transmission:

 

	15.1.1  	
      in
      the cases of Corp and the Corp Persons, to TXU Corp., 1601 Bryan Street,
      Dallas TX 75201, USA, facsimile number +1 214 812 6032 (for the attention
      of David Poole);

 

	15.1.2  	
      in
      the cases of any of the Holding Companies or the KPMG Officeholders, to
      KPMG LLP of 8 Salisbury Square, London EC4Y 8BB, facsimile number 020 7694
      3011 (for the attention of Jim Tucker); 

 

	15.1.3  	
      in
      the cases of the TXUE Persons named in Part I of Schedule 3, to TXU Corp.,
      1601 Bryan Street, Dallas TX 75201, USA, facsimile number +1 214 812 6032
      (for the attention of David Poole);

 

	15.1.4  	
      in
      the cases of the TXUE Persons named in Part II of Schedule 3, to Berwin
      Leighton Paisner, Adelaide House, London Bridge, London EC4R 9HA,
      facsimile number 020 7760 1111 (for the attention of
      BLAR/DAP/DUL/SJNS/21146/2); and

 

	15.1.5  	
      in
      the case of the TXUE Persons named in Part III of Schedule 3, to Lovells,
      Atlantic House, Holborn Viaduct, London EC1A 2FG, facsimile number 020
      7296 2001 (for the attention of Russell Sleigh/Jeremy
    Cole);

 

or such
other address and numbers as each such party may from time to time expressly
substitute for them by notice given to the other parties.

15

 

	15.2  	
      Any
      notice under this Agreement will be deemed to be given when the relevant
      facsimile transmission is received in legible
form.

 

	15.3  	
      All
      documents that are required to be delivered to Corp under this Agreement
      shall be delivered to the address and for the attention specified in
      Clause 15.1.5.

 

	16  	
      GOVERNING
      LAW
      AND JURISDICTION

 

	16.1  	
      This
      Agreement shall be governed by and construed in accordance with English
      law. 

 

	16.2  	
      The
      parties hereby irrevocably agree to submit to the exclusive jurisdiction
      of the High Court of England and Wales in respect of any dispute, action
      or proceeding arising out of or in connection with this Agreement. Each
      party hereby irrevocably waives any objection which it might have at any
      time to the High Court being nominated as the forum to hear and determine
      any such dispute, action or proceeding and for such purpose agrees not to
      claim that such court is an inconvenient or inappropriate
      forum.

 

	16.3  	
      Each
      of Corp and the Corp Persons irrevocably appoints Lovells, of Atlantic
      House, Holborn Viaduct, London EC1A 2FG, facsimile number 020 7296 2001
      (for the attention of Russell Sleigh/Jeremy Cole), as its agent for
      service of process in relation to any proceedings before the English
      Courts in connection with this Agreement. 

16

 

AS
WITNESS the
hands of the parties or their duly authorised representatives the day and year
first before written.

HOLDING
COMPANIES

SIGNED
by  )

ENERGY
HOLDINGS (No.1) LIMITED  )

(in
administration)   )

ENERGY
HOLDINGS (No.2) LIMITED  )

(in
administration)   )

ENERGY
HOLDINGS (No.4) LIMITED  )

(in
administration)   )

ENERGY
HOLDINGS (No.5) LIMITED  )

(in
administration)   )

THE
ENERGY GROUP LIMITED  )

(in
administration)   )

TXU
ACQUISITIONS LIMITED  )

(in
administration)   )

TXU
EASTERN FINANCE (A) LIMITED  )

(in
administration)   )

TXU
EASTERN FINANCE (B) LIMITED  )

(in
administration)   )

TXU
EASTERN FUNDING COMPANY  )

(in
administration)   )

TXU
EUROPE LIMITED  )

(in
administration)  )

TXU
FINANCE (No.2) LIMITED  )

(in
administration)   )

each
acting by JAMES
TUCKER, of KPMG
LLP,  )

its Joint
Administrator acting as agent and without   )

personal
liability.

17

SIGNED
by    )

ALLIEDHIKE
LIMITED   )

(in
liquidation)    )

ANGBUR
INVESTMENT TRUST LIMITED   )

(in
liquidation)    )

ANGLO-FRENCH
EXPLORATION    )

COMPANY
LIMITED   )

(in
liquidation)   )

C.
TENNANT, SONS & COMPANY LIMITED   )

(in
liquidation)    )

CGF
INVESTMENTS LIMITED   )

(in
liquidation)    )

CONSOLIDATED
GOLD FIELDS LIMITED   )

(in
liquidation)   )

ENERGY
(No.30) LIMITED   )

(in
liquidation)    )

ENERGY
HOLDINGS (No.3) LIMITED   )

(in
liquidation)    )

ENERGY
NOMINEES LIMITED   )

(in
liquidation)    )

ENERGY
RESOURCES LIMITED   )

(in
liquidation)    )

GOLD
FIELDS RHODESIAN DEVELOPMENT    )

COMPANY
LIMITED (THE)   )

(in
liquidation)    )

GOLD
FIELDS INDUSTRIAL LIMITED   )

(in
liquidation)    )

GOLD
FIELDS INDUSTRIAL HOLDINGS LIMITED  )

(in
liquidation)   )

GOLD
FIELDS MAHD ADH DHAHAB LIMITED   )

(in
liquidation)    )

GOLD
FIELDS MINING & INDUSTRIAL LIMITED  )

(in
liquidation)    )

MINING
& INDUSTRIAL HOLDINGS LIMITED   )

(in
liquidation)    )

NEW
CONSOLIDATED GOLD FIELDS LIMITED   )

(in
liquidation)    )

ROSE,
LLOYD & CO. LIMITED   )

(in
liquidation)    )

TEG
(HEAD OFFICE) LIMITED   )

(in
liquidation)    )

TENNANT
SECURITY LIMITED   )

(in
liquidation)    )

TENNANT
TRADING LIMITED   )

(in
liquidation)    )

THE
ENERGY GROUP INTERNATIONAL LIMITED )

(in
liquidation)    )

each
acting by JAMES
TUCKER, of KPMG
LLP,   )

its Joint
Liquidator acting as agent and without    )

personal
liability.   )

18

SIGNED
by  )

ENERGY
GROUP HOLDINGS B.V.  )

(in
administration)   )

ENERGY
GROUP OVERSEAS B.V.  )

(in
administration)   )

each
acting by FINBARR
O'CONNELL, of KPMG
LLP, )

its Joint
Administrator acting as agent and without   )

personal
liability.  )

SIGNED
by )

MAJOR
INSURANCE COMPANY LIMITED )

(BERMUDA) )

(in
liquidation) acting
by MIKE
MORRISON, )

of KPMG
LLP, its Joint Liquidator acting as agent )

and
without personal liability. )

KPMG
OFFICEHOLDERS

SIGNED by
JAMES
TUCKER, of KPMG
LLP, in  )

his own
capacity and on behalf of   )

the
administrators or liquidators of:  )

Anglo-French
Exploration Company Limited (in liquidation) )

Energy
Holdings (No.1) Limited (in administration)  )

Energy
Holdings (No.2) Limited (in administration)  )

Energy
Holdings (No.4) Limited (in administration)  )

Energy
Holdings (No.5) Limited (in administration)  )

The
Energy Group Limited (in administration)  )

TXU
Acquisitions Limited (in administration)  )

TXU
Eastern Finance (A) Limited (in administration)  )

TXU
Eastern Finance (B) Limited (in administration)  )

TXU
Eastern Funding Company (in administration)  )

TXU
Europe Limited (in administration)  )

TXU
Finance (No.2) Limited (in administration)  )

Alliedhike
Limited (in liquidation)  )

Angbur
Investment Trust Limited (in liquidation)  )

C.
Tennant, Sons & Company Limited (in liquidation)  )

CGF
Investments Limited (in liquidation)  )

Consolidated
Gold Fields Limited (in liquidation)  )

Energy
(No.30) Limited (in liquidation)  )

Energy
Holdings (No.3) Limited (in liquidation)  )

Energy
Nominees Limited (in liquidation)  )

Energy
Resources Limited (in liquidation)  )

Gold
Fields Rhodesian Development  )

19

Company
Limited (The) (in liquidation)  )

Gold
Fields Industrial Limited (in liquidation)  )

Gold
Fields Industrial Holdings Limited (in liquidation)  )

Gold
Fields Mahd Adh Dhahab Limited (in liquidation)  )

Gold
Fields Mining & Industrial Limited(in liquidation)  )

Mining
& Industrial Holdings Limited (in liquidation)  )

New
Consolidated Gold Fields Limited (in liquidation)  )

Rose,
Lloyd & Co. Limited (in liquidation)  )

TEG
(Head Office) Limited (in liquidation)  )

Tennant
Security Limited (in liquidation)  )

Tennant
Trading Limited (in liquidation)  )

The
Energy Group International Limited (in
liquidation)  )

without
personal liability.   )

 

 

 

 

 

 

SIGNED
by    )

FINBARR
O'CONNELL, of KPMG
LLP, in )

his own
capacity and on behalf of   )

PHILIP
WALLACE   )

in
relation to    )

Energy
Group Holdings B.V. (in administration) )

Energy
Group Overseas B.V. (in administration) )

without
personal liability.  )

 

 

 

 

SIGNED
by    )

MIKE
MORRISON, of KPMG
LLP,
in  )

his own
capacity in
relation to  )

Major
Insurance Company Limited   )

(Bermuda)
(in liquidation)  )

without
personal liability.  )

 

 

 

 

 

20

 

 

SIGNED by
TXU
CORP.    )

acting by
Eric
H Peterson, Executive  )

Vice
President and General Counsel  )

of
TXU Corp., duly
authorised    )

to sign
on behalf of TXU Corp.   )

 

 

 

 

SIGNED by
Eric
H Peterson, Executive  )

Vice-President
and General Counsel of  )

TXU
Corp., duly
authorised to sign on behalf of )

the
CORP
PERSONS named in
Schedule 2  )

herein.       )

 

 

 

 

SIGNED by
Eric
H Peterson, Executive  )

Vice-President
and General Counsel of  )

TXU Corp., duly
authorised to sign on behalf of )

the
TXUE
PERSONS named in
Part I of Schedule )

3
herein.      )

 

 

 

SIGNED by
LOVELLS acting
by Russell HP Sleigh, )

Partner,
duly authorised to sign on behalf of Lovells  )

and any
of its partners or employees, including any  )

employees
of Lovells Services Limited, solely in its and  )

their
capacities as former advisers to any or all of the  )

Holding
Companies.      )

 

 

21

 

SIGNED by
BERWIN
LEIGHTON PAISNER )

acting by
Benjamin M. Larkin, Partner, duly authorised )

to sign
on behalf of the TXUE
PERSONS
named )

in Part
II of Schedule 3.    )

 

 

 

 

 

22

 

  Schedule
1

The
Holding Companies

 

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      Energy
      Holdings (No.1) Limited

       
	
       

      Administration

       
	
       

      3239971

       
	
       

      Joint
      administrators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      May 2003

       

	
      Energy
      Holdings (No. 2) Limited

       
	
       

      Administration

       
	
       

      2969102

       
	
       

      Joint
      administrators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      May 2003

       

	
      Energy
      Holdings (No. 4) Limited

       
	
       

      Administration

       
	
       

      1468589

       
	
       

      Joint
      administrators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      May 2003

       

	
      Energy
      Holdings (No. 5) Limited

       
	
       

      Administration

       
	
       

      941665

       
	
       

      Joint
      administrators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      May 2003

       

	
       

      Energy
      Group Holdings B.V.

       
	
       

      Administration

       
	
       

      33296335

       

       

      (Amsterdam)

       
	
       

      Joint
      administrators: Philip Wallace and Finbarr O’Connell of KPMG
      LLP

       
	
       

      20
      November 2003

       

	
       

      Energy
      Group Overseas B.V.

       
	
       

      Administration

       
	
       

      33296337
      (Amsterdam)

       
	
       

      Joint
      administrators: Philip Wallace and Finbarr O’Connell of KPMG
      LLP

       
	
       

      20
      November 2003

       

23

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      The
      Energy Group Limited

       
	
       

      Administration

       
	
       

      3613919

       
	
       

      Joint
      Administrators: Philip Wallace and James Tucker of KPMG LLP

       
	
       

      19
      November 2002

       

	
       

      TXU
      Acquisitions Limited

       
	
       

      Administration

       
	
       

      3455523

       
	
       

      Joint
      Administrators: Philip Wallace and James Tucker of KPMG LLP

       
	
       

      19
      November 2002

       

	
       

      TXU
      Eastern Finance (A) Limited

       
	
       

      Administration

       
	
       

      3680673

       
	
       

      Joint
      administrators: James Tucker and Richard Hill of KPMG LLP

       
	
       

      3
      November 2003

       

	
       

      TXU
      Eastern Finance (B) Limited

       
	
       

      Administration

       
	
       

      3679711

       
	
       

      Joint
      administrators: James Tucker and Richard Hill of KPMG LLP

       
	
       

      3
      November 2003

       

	
       

      TXU
      Eastern Funding Company

       
	
       

      Administration

       
	
       

      3710529

       
	
       

      Joint
      Administrators: James Tucker and Richard Hill of KPMG LLP

       
	
       

      3
      November 2003

       

	
       

      TXU
      Europe Limited

       
	
       

      Administration

       
	
       

      3505836

       
	
       

      Joint
      Administrators: Philip Wallace and James Tucker of KPMG LLP

       
	
       

      19
      November 2002

       

	
       

      TXU
      Finance (No. 2) Limited

       
	
       

      Administration

       
	
       

      3514100

       
	
       

      Joint
      Administrators: Philip Wallace and James Tucker of KPMG LLP

       
	
       

      2
      May 2003

       

24

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      Alliedhike
      Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      3328435

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      17
      April 2004

       

	
       

      Angbur
      Investment Trust Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      214006

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Anglo-French
      Exploration Company Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      30500

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      C.
      Tennant, Sons & Company Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      719196

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      CGF
      Investments Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      2399504

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Consolidated
      Gold Fields Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      36936

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      8
      February 1999

       

	
       

      Energy
      (No.30) Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      3568436

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG

       
	
       

      17
      April 2003

       

25

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      Energy
      Holdings (No. 3) Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      3257256

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      30
      December 2002

       

	
       

      Energy
      Nominees Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      333359

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Energy
      Resources Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      3273548

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      17
      April 2003

       

	
       

      Gold
      Fields Rhodesian Development Company Limited (The)

       
	
       

      Liquidation

      (CVL)

       
	
       

      119968

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Gold
      Fields Industrial Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      92890

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Gold
      Fields Industrial Holdings Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      261411

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      29
      April 2004

       

	
       

      Gold
      Fields Mahd adh Dhahab Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      1205059

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

26

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      Gold
      Fields Mining & Industrial Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      114629

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      29
      April 2004

       

	
       

      Major
      Insurance Company Limited

       
	
       

      Liquidation

      (MVL
      - Bermuda)

       
	
       

      13574
      (Bermuda)

       
	
       

      Mike
      Morrison of KPMG LLP (Bermuda)

       
	
       

      6
      October 2003

       

	
       

      Mining
      & Industrial Holdings Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      714355

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      New
      Consolidated Gold Fields Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      157784

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      Rose,
      Lloyd & Co. Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      155388

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      TEG
      (Head Office) Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      2259512

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      17
      April 2003

       

	
       

      Tennant
      Security Limited

       
	
       

      Liquidation

      (MVL)

       
	
       

      70705

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

27

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      KPMG
      Officeholders

       
	
       

      Petition
      Date

       

	
       

      Tennant
      Trading Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      219270

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

	
       

      The
      Energy Group International Limited

       
	
       

      Liquidation

      (CVL)

       
	
       

      410122

       
	
       

      Joint
      liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      2
      February 2004

       

 

28

 

  Schedule
2

 

The
Corp Persons

 

Derek C
Bonham

Brian A
Dickie 

H Jarrell
Gibbs

Michael J
McNally

Erle A
Nye

Eric H
Peterson

Philip G
Turberville 

Robert A
Wooldridge 

Jerry S
Farrington

William M
Griffin

Kerney
Laday

Jack E
Little

Margaret
N Maxey

James E
Oesterreicher

Charles R
Perry

Herbert H
Richardson

Manu
Asthana

Thomas L
Baker

Andrew C
Cameron

John E
Crawford Jr.

John P
Gamino

Michael J
Garberding

Anthony R
Horton

Jerry D
Hunt

Kirk R
Oliver

Paul F
O’Malley

Stanley J
Szlauderbach

Peter B
Tinkham

Philip S
Toler

Max
Underwood

29

 

  Schedule
3

The
TXUE Persons

Part
I

Derek C
Bonham

Brian A
Dickie 

H Jarrell
Gibbs

Michael J
McNally

Erle A
Nye

Eric H
Peterson

Philip G
Turberville 

Robert A
Wooldridge

Part
II

Henry
Birt

Howard
Goodbourn

Brian
Hutchinson

Paul C
Marsh

Martin
Murray

Roger
Partington

Willem
Smit

Martin S
W Stanley

Gary
Wiffin

 

Part
III

 

Lovells
and any of its partners or employees, including employees of Lovells Services
Limited, solely in its and their capacities as former advisers to any or all of
the Holding Companies.

 

 

30

 

  Schedule
4

The
Operating Companies

 

Part
I

 

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe Group plc

       
	
       

      Administration

       
	
       

      03247622

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y, together with Philip
      Wallace and James Tucker of KPMG

       
	
       

      19
      November 2002

       

	
       

      TXU
      Europe Energy Trading Limited

       
	
       

      Administration

       
	
       

      03116221

       
	
       

      Joint
      Administrators: Alan Bloom, Roy Bailey and Gareth Hughes of
      E&Y

       
	
       

      19
      November 2002

       

	
       

      TXU
      Europe Power Limited

       
	
       

      Administration

       
	
       

      02353756

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      17
      February 2003

       

	
       

      TXU
      UK Limited

       
	
       

      Administration

       
	
       

      02937796

       
	
       

      Joint
      Administrators: Alan Bloom, Roy Bailey and Gareth Hughes of E&Y and
      Christopher Hughes of Talbot Hughes McKillop LLP1 

       
	
       

      19
      November 2002

       

 

____________________

1  Christopher
Hughes appointed on 11 March 2004.

31

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      Eastern
      Electricity Holdings Limited

       
	
       

      Administration

       
	
       

      04191756

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      18
      September 2003

       

	
       

      TXU
      Europe Merchant Properties Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03181383

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

	
       

      TXU
      Europe Merchant Generation Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03116225

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

	
       

      TXU
      Europe Power Development Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02529347

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      19
      June 2003

       

	
       

      TXU
      Europe (Partington) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03210149

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      April 2003

       

	
       

      TXU
      Europe Power Production Services Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571895

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

	
       

      TXU
      (UK) Holdings Limited

       
	
       

      Administration

       
	
       

      02907433

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      27
      August 2003

       

	
       

      Energy
      Holdings (No.6) Limited

       
	
       

      Administration

       
	
       

      04191744

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      18
      September 2003

       

32

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe Leasing (4) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02969719

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe (Blade No.2) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04165891

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      11
      July 2003

       

	
       

      TXU
      Europe (Blade) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04195832

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe Trading Limited

       
	
       

      Liquidation
      (MVL)

       
	
       

      03431927

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      April 2003

       

	
       

      TXU
      Europe Natural Gas (Trading) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02937812

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      11
      July 2003

       

	
       

      TXU
      Finland Holdings Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571911

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      TXU
      Germany Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571857

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      TXU
      Europe Overseas Finance Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03116229

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      July 2003

       

33

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe Leasing (5) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02512605

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      Precis
      (2264) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04487349

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe Renewable Generation Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03300836

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      TXU
      Direct Sales Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03181389

       
	
       

      Joint
      Liquidators: Alan Lovett and Martin Fishman of E&Y

       
	
       

      30
      September 2003

       

Part
II

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      Eastern
      Group Finance Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02937764

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      30
      September 2003

       

	
       

      Anglian
      Power Generators Limited

       
	
       

      Administration

       
	
       

      02488955

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

	
       

      Peterborough
      Power Limited

       
	
       

      Administration

       
	
       

      02353599

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

	
       

      TXU
      Europe Power Services Limited

       
	
       

      Administration

       
	
       

      03568319

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

 

 

34

 

  Schedule
5

Excluded
Companies 

 

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Officeholders
      (if any)

       
	
       

      Petition
      Date

       

	
       

      Apriliasviluppo
      SRL Italy

       
	
       

      Liquidation

      (In
      Italy)

       
	
       

      07117271002

       
	
       

      Massimo
      Matteini of Ciccioriccio e Associati

       
	 
	
       

      ARES
      Energie Direkt GmbH

       
	
       

      Receivership

      (In
      Germany)

       
	
       

      HRB
      72090

       
	
       

      Dirk
      Wittkowski of Henningsmeier Rechtanswalte

       
	 
	
       

      Barking
      Power Limited

       
	
       

      Active
      - controlled by the directors

       
	
       

      02354681

       
	
       

      N/A

       
	
       

      N/A

       

	
       

      Eastern
      Energy Management Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02879327

       
	
       

      Joint
      Liquidators: Alan Bloom, Elizabeth Bingham and Roy Bailey of
      E&Y

       
	
       

      24
      July 2003

       

	
       

      Eastern
      Group Insurance Services Limited

       
	
       

      Overseas
      Company

      Liquidation
      completed

       
	 	
       

      Joint
      Liquidators: Alan Bloom and Paul Duffy of E&Y

       
	 

35

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Officeholders
      (if any)

       
	
       

      Petition
      Date

       

	
       

      Eastern
      Metering Services Limited

       
	
       

      Active
      - controlled by the sole director: Paul Colin Marsh

       
	
       

      03431926

       
	
       

      N/A

       
	
       

      N/A

       

	
       

      Exploration
      Ventures Limited

       
	
       

      Liquidation

      (MVL)
	
       

      513532

       
	
       

      Joint
      Liquidators: Jonathan Sisson and Richard Setchim of PricewaterhouseCoopers
      LLP

       
	
       

      23
      November 2004

       

	
       

      Exven
      Limited

       
	
       

      Liquidation

      (MVL)
	
       

      977929

       
	
       

      Joint
      Liquidators: Jonathan Sisson and Richard Setchim of PricewaterhouseCoopers
      LLP

       
	
       

      23
      November 2004

       

	
       

      F.W.
      Cook (Mechanical Services) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      01599611

       
	
      Joint
      Liquidators: Alan Bloom, Elizabeth Bingham and Roy Bailey of
      E&Y
	
       

      30
      September 2003

       

	
       

      Ginpep
      Limited (fka Eastern Metering and Data Collection Limited)

       
	
       

      Liquidation
      (MVL)

       
	
       

      03431922

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      Gold
      Fields Resources Limited

       
	
       

      Active
      - controlled by the sole director: Paul Colin Marsh

       
	
       

      2958009

       
	
       

      N/A
	
       

      N/A

       

36

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Officeholders
      (if any)

       
	
       

      Petition
      Date

       

	
       

      Hutchints
      Limited (fka Gwynedd Power Limited)

       
	
       

      Liquidation
      (MVL)

       
	
       

      03087765

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      Logicalform
      Limited

       
	
       

      Active
      - controlled by the sole director: Paul Colin Marsh

       
	
       

      03636453

       
	
       

      N/A

       
	
       

      N/A

       

	
       

      Minven
      Minerals Limited

       
	
       

      Liquidation

      (MVL)
	
       

      987755

       
	
       

      Joint
      Liquidators: Jonathan Sisson and Richard Setchim of PricewaterhouseCoopers
      LLP

       
	
       

      23
      November 2004

       

	
       

      Nedalo
      B.V.

       
	
       

      Liquidation
      (CVL)

       
	
       

      30121704

       
	
       

      Liquidator:
      Paul Schaink of Van Doorne

       
	
       

      20
      December 2002

       

	
       

      Norweb
      Energi Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04141411

       
	
       

      Joint
      Liquidators: Anthony Supperstone and Malcolm Cohen of BDO Stoy
      Hayward

       
	
       

      29
      November 2002

       

	
       

      Peabody
      Resources (UK) Limited

       
	
       

      Active
      - controlled by the sole director: Paul Colin Marsh

       
	
       

      1451215

       
	
       

      N/A
	
       

      N/A

       

	
       

      Shotton
      Combined Heat and Power Limited

       
	
       

      Administrative
      Receivership

       
	
       

      03181385

       
	
       

      Joint
      Receivers: Roger Marsh and Michael Horrocks of PricewaterhouseCoopers
      LLP

       
	
       

      17
      December 2002

       

37

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Officeholders
      (if any)

       
	
       

      Petition
      Date

       

	
       

      Speechnet
      Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03046672

       
	
       

      Joint
      Liquidators: Anthony Supperstone and Malcolm Cohen of BDO Stoy
      Hayward

       
	
       

      11
      July 2003

       

	
       

      Stallingborough
      CHP Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02669504

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      30
      September 2003

       

	
       

      TXU
      Europe (AHG Shipping Services) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03169402

       
	
       

      Joint
      Liquidators: Malcolm Cohen and Anthony Supperstone of BDO Stoy
      Hayward

       
	
       

      24
      April 2003

       

	
       

      TXU
      Europe (Deutschland Beteiligungs) GmbH

       
	
       

      Liquidation
      (In Germany)

       
	
       

      501
      HRB 5940

       
	
       

      Jens-Soren
      Schroder of Johlke, Niethammer & Partner

       
	 
	
       

      TXU
      Europe Energy Trading (Deutschland) GmbH

       
	
       

      Solvent
      Liquidation

       
	
       

      HRB
      5734

       
	
       

      Joint
      Liquidators: Roy Bailey and Andreas Crone of E&Y

       
	
       

      11
      January 2005

       

	
       

      TXU
      Europe Energy Trading (Italia) SpA

       
	
       

      Liquidation
      (In Italy)

       
	
       

      1311
      5910 153

       
	
       

      Massimo
      Matteini of Ciccioriccio e Associati

       
	 
	
       

      TXU
      Europe Energy Trading (Nederland) B.V.

       
	
       

      Solvent
      Liquidation

       
	
       

      24290470

       
	
       

      Joint
      Liquidators: Roy Bailey and Alan Bloom of E&Y

       
	
       

      11
      January 2005

       

38

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Officeholders
      (if any)

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe Energy Trading (Poland) Zoo

       
	
       

      Liquidation

       
	
       

      0000042930

       
	
       

      Mikolaj
      Franzkowia 

       
	
       

      April
      2003

       

	
       

      TXU
      Europe Energy Trading (UK) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03568552

       
	
       

      Joint
      Liquidators: Anthony Supperstone and Malcolm Cohen of BDO Stoy
      Hayward

       
	
       

      11
      July 2003

       

	
       

      TXU
      Europe Energy Trading B.V.

       
	
       

      Bankruptcy

       
	
       

      27182078

       
	
       

      Jop
      Rosenberg Polak of Salomons Van der Valk and Jurjen Lemstra of Pels
      Rijcken & Droogleever Fortuijn

       
	
       

      25
      November 2004

       

	
       

      TXU
      Stadtwerke Holdings GmbH & Co. KG

       
	
       

      Active
      partnership 

       
	
       

      HRA
      33411

       
	
       

      Controlled
      by Roy Bailey of E&Y (via TXU Europe Energy Trading (Deutschland) GmbH
      and TXU Europe Energy Trading (Nederland) B.V partnership holdings - not
      as direct officeholder).

       
	
       

      N/A

       

	
       

      TXU
      (PT1) Limited (fka Energy Portfolio Funding Limited)

       
	
       

      Liquidation
      (CVL)
	
       

      03571869

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      July 2003

       

	
       

      Web
      Power Limited

       
	
       

      Overseas
      Company

       
	 	
       

      N/A

       
	
       

      N/A

       

	
       

      Zamojska
      Spolka Elektoenrgetyczna Sp Zoo

       
	
       

      Liquidation
      (Poland)

       
	
       

      RHB
      582

       
	
       

      Krzysztof
      Pilus of Domanski Zahrzewski Palinka sp.k.

       
	
       

      2
      October 2001

       

 

39

Schedule
6

Operating
Company Deed of Release

Dated
[  ]

Between

OPERATING
COMPANIES AND THEIR OFFICEHOLDERS

TXU
EUROPE IRELAND 1 (IN LIQUIDATION) AND ITS OFFICEHOLDERS

TXU
EUROPE GERMAN FINANCE B.V. (IN LIQUIDATION) AND ITS
OFFICEHOLDERS

TXU
EUROPE LIMITED (IN ADMINISTRATION) AND ITS OFFICEHOLDERS

and

TXU
CORP.

_________________________________

 

OPERATING
COMPANY DEED OF RELEASE

_________________________________

Cadwalader

Cadwalader,
Wickersham & Taft LLP

265
Strand

London,
WC2R 1BH

Tel: +44
(0) 20 7170 8700

Fax: +44
(0) 20 7170 8600 

Ref:
YC/95977.001

40

 

	 	
      TABLE
      OF CONTENTS

       
	 
	 	 	
      Page

       

	
      1

       
	
      INTERPRETATION

       
	
      2

       

	
      2

       
	
      RELEASES

       
	
      2

       

	
      3

       
	
      FURTHER
      ASSURANCE

       
	
      3

       

	
      4

       
	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT

       
	
      3

       

	
      5

       
	
      OFFICEHOLDERS
      NOT PERSONALLY LIABLE

       
	
      4

       

	
      6

       
	
      MISCELLANEOUS

       
	
      5

       

	
      7

       
	
      NOTICES

       
	
      6

       

	
      8

       
	
      GOVERNING
      LAW AND JURISDICTION

       
	
      6

       

	
      Annex
      1 Operating Companies and Officeholders

       
	
      13

       

41

 

THIS
DEED is made
the [  ] day of [  ] 2005

 

BETWEEN:

 

	(1)  	
      The
      companies named in Parts I, II and III of Annex 1 hereto (the
      “Operating
      Companies”),
      each acting by its officeholders specified in Annex 1 as agents without
      personal liability (the “Operating
      Company Officeholders”);

 

	(2)  	
      The
      Operating Company Officeholders;

 

	(3)  	
      TXU
      Europe Ireland 1 (in liquidation), a company incorporated in Ireland with
      company number 316371, (“Ireland
      1”)
      acting by its joint liquidators named in Part IV of Annex 1 as agents
      without personal liability (the “Ireland
      1 Officeholders”),
      and having its registered office at Wilton Place, Dublin 2,
      Ireland;

 

	(4)  	
      The
      Ireland 1 Officeholders;

 

	(5)  	
      TXU
      Europe German Finance B.V. (in liquidation), a company incorporated in the
      Netherlands with company number 27251472, (“German
      Finance”)
      acting by its joint liquidators named in Part IV of Annex 1 as agents
      without personal liability (the “German
      Finance Officeholders”),
      and having its registered office at Koninginnegracht 15 2514 AB, The
      Hague, Netherlands;

 

	(6)  	
      The
      German Finance Officeholders;

 

	(7)  	
      TXU
      Europe Limited (in administration), a company incorporated in England and
      Wales with company number 03505836, acting by its joint administrators as
      agents without personal liability and having its registered office at 8
      Salisbury Square, London EC4Y 8BB (“TXUEL”);
      

 

	(8)  	
      The
      joint administrators of TXUEL, James R Tucker and Philip W Wallace of KPMG
      LLP, of 8 Salisbury Square, London EC4Y 8BB, each acting as agent without
      personal liability (the “TXUEL
      Officeholders”);
      and

 

	(9)  	
      TXU
      Corp., a
      corporation incorporated under the laws of Texas in the United States of
      America and having its registered office at Energy Plaza, 1601 Bryan
      Street, Dallas, Texas 75201, USA (“Corp”).

 

WHEREAS:

 

	(A)  	
      Capitalised
      terms used but not defined in these recitals have the respective meanings
      set out above or as specified in Clause 1.1 of this
  Deed.

 

	(B)  	
      Certain
      companies in the TXUE Group have put Corp, certain of the Corp Persons and
      certain of the TXUE Persons on notice of claims any or all of them have or
      may have against any or all of Corp, the Corp Persons and the TXUE
      Persons. Each of Corp, the Corp Persons and the TXUE Persons denies
      liability in respect of all such claims.

 

	(C)  	
      The
      Holding Companies and the KPMG Officeholders have entered into a
      settlement agreement dated on or about 27 January 2005 with Corp, the Corp
      Persons and the TXUE Persons (the “Settlement
      Agreement”).
      Pursuant to the terms of the Settlement Agreement (and subject to the
      satisfaction of certain conditions) releases, waivers and discharges will
      be granted by each of Corp, the Corp Persons and the TXUE Persons for the
      benefit of, amongst others, the Operating Companies and the Operating
      Company Officeholders.

 

42

	(D)  	
      It
      is a condition to the effectiveness of said releases that the parties
      execute and deliver this Deed on the terms set out
  below.

 

	(E)  	
      TXUEL,
      the TXUEL Officeholders and Corp wish to be parties to this Deed for the
      purposes of enforcement thereof.

 

NOW
IT IS AGREED as
follows:

 

	1  	
      INTERPRETATION

 

	1.1  	
      Capitalised
      terms used but not defined in this Deed have the respective meanings
      defined in the Settlement Agreement, save where specified or where the
      context otherwise requires.

 

	1.2  	
      References
      herein to any numbered Section, Part, Clause, or Annex without further
      designation shall, unless the context otherwise requires, be construed as
      a reference to the section, part or clause of or annex to this Deed as so
      numbered.

 

	1.3  	
      Annexes
      to this Deed form part of and are deemed to be incorporated in this
      Deed.

 

	1.4  	
      Section
      headings of and in any Annex to this Deed are for convenience only and
      shall not be taken into account in the interpretation of this
      Deed.

 

	1.5  	
      References
      in this Deed to any statute or statutory provision shall mean that statute
      or statutory provision as amended and in force as at the date of this
      Deed.

 

	1.6  	
      Words
      used in this Deed importing the plural shall include the singular and
      vice
      versa.

 

	1.7  	
      The
      term “person” when used in this Deed shall include an individual, a firm,
      a body corporate, an unincorporated association, a partnership and a
      person’s legal personal representatives or
successors.

 

	1.8  	
      Statements
      contained in the recitals to this Deed shall be considered in the
      interpretation of this Deed.

 

	2  	
      RELEASES

 

	2.1  	
      Subject
      to Clause 2.5 below, the terms of this Section 2 shall become effective
      subject to and immediately upon receipt of the Settlement Sum and the
      Reimbursement Sums in accordance with Section 2 of the Settlement
      Agreement.

 

	2.2  	
      In
      consideration of the releases, waivers and discharges to be given under
      Clauses 3.2 and 3.4 of the Settlement Agreement, each of the Operating
      Companies, the Operating Company Officeholders, Ireland 1, the Ireland 1
      Officeholders, German Finance and the German Finance Officeholders hereby
      irrevocably releases, waives and discharges, to the maximum extent
      permitted by law, any and all Claims it has or may have against any or all
      of:

 

43

	2.2.1  	
      the
      TXUE Persons;

 

	2.2.2  	
      the
      TXUE Third Parties;

 

	2.2.3  	
      Corp;

 

	2.2.4  	
      the
      Corp Persons; and

 

	2.2.5  	
      the
      Corp Third Parties.

 

	2.3  	
      Within
      two Business Days of receipt of the Settlement Sum and the Reimbursement
      Sums in accordance with Section 2 of the Settlement Agreement, the TXUEL
      Officeholders shall notify the Operating Company Officeholders of that
      fact, provided that failure to comply with this Clause shall not be a
      condition to the effectiveness of the releases in Clause
    2.2.

 

	2.4  	
      TXUEL
      and Corp agree they shall not consent to any amendment or supplement to
      Section 3 of the Settlement Agreement without first obtaining the consent
      of the Operating Companies, the Operating Company Officeholders, Ireland
      1, the Ireland 1 Officeholders, German Finance and the German Finance
      Officeholders.

 

	2.5  	
      Save
      for the companies named in Part III of Annex 1, the terms of this Deed
      shall not apply to any Operating Company in respect of which, immediately
      following the last occurring Implementation Date in respect of the Core
      Operating Company CVAs, no Implementation Date for a CVA has
      occurred.

 

	3  	
      FURTHER
      ASSURANCE

 

Each
party shall at its own cost do and execute or procure to be done and executed
all necessary acts, deeds, documents and things reasonably within its power to
give effect to this Deed.

 

	4  	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT

 

	4.1  	
      It
      is expressly intended and agreed by the parties that each
    of:

 

	4.1.1  	
      the
      TXUE Persons;

 

	4.1.2  	
      the
      TXUE Third Parties; 

 

	4.1.3  	
      the
      Corp Persons; and

 

	4.1.4  	
      the
      Corp Third Parties,

 

shall be
entitled in its own right to enforce such releases, waivers and discharges as
may be given to it and become effective under the terms of this Deed by virtue
of and in accordance with the Contracts (Rights of Third Parties) Act
1999.

 

	4.2  	
      With
      the exception of the persons referred to in Clause 4.1, a person who is
      not a party to this Deed may not enforce any of its terms under the
      Contracts (Rights of Third Parties) Act
1999.

 

44

	4.3  	
      No
      consent of any third party (including for the avoidance of doubt, any
      person referred to in Clause 4.1) shall be required to amend, waive,
      substitute or supplement any provisions of this
Deed.

 

	4.4  	
      The
      parties to this Deed may rescind or vary this Deed or any of its terms
      without the consent of any person referred to in Clause 4.1, even if the
      rights of any such person under Clause 4.1 shall, by reason of such
      rescission or variation, be extinguished or
altered.

 

	5  	
      OFFICEHOLDERS
      NOT PERSONALLY LIABLE

 

	5.1  	
      This
      Deed is entered into by the Operating Company Officeholders, the Ireland 1
      Officeholders, the German Finance Officeholders and the TXUEL
      Officeholders as agents, in each case, without personal liability.
      

 

	5.2  	
      The
      Parties to this Deed acknowledge and agree that:

 

	5.2.1  	
      none
      of the TXUEL Officeholders, the Operating Company Officeholders, the
      Ireland 1 Officeholders and the German Finance Officeholders nor their
      respective firms, fellow members, partners, employees, agents, advisers or
      representatives shall incur any personal liability under, or by virtue of,
      this Deed, nor in relation to any related matter or claim howsoever,
      whenever and wherever arising, and whether such claim is formulated in
      contract and/or tort or by reference to any other remedy or right, and in
      whatever jurisdiction or forum;

 

	5.2.2  	
      none
      of the TXUEL Officeholders, the Operating Company Officeholders, the
      Ireland 1 Officeholders and the German Finance Officeholders nor their
      respective firms, fellow members, partners, employees, agents, advisers or
      representatives has given or entered into any collateral undertakings,
      representations, warranties or deeds in connection with this Deed;
      

 

	5.2.3  	
      save
      as specified above, the TXUEL Officeholders, the Operating Company
      Officeholders, the Ireland 1 Officeholders and the German Finance
      Officeholders are parties to this Deed in their personal capacities solely
      for the purpose of receiving the benefit of the exclusions, limitations,
      undertakings, covenants and releases in their favour as provided in or
      effected by this Deed; and

 

	5.2.4  	
      nothing
      in this Deed shall operate to restrict or affect in any way any right of
      the TXUEL Officeholders, the Operating Company Officeholders, the Ireland
      1 Officeholders and the German Finance Officeholders to an indemnity or
      assurance to which by law they are
entitled.

 

	6  	
      MISCELLANEOUS

 

	6.1  	
      This
      Deed constitutes the whole agreement between the parties hereto relating
      to its subject matter.

 

	6.2  	
      This
      Deed supersedes any other agreement or arrangement entered into between
      the parties with respect to the subject matter hereof and, to the extent
      that any other agreement or arrangement has been entered into by any party
      which contains provisions inconsistent with the terms of this Deed, the
      terms of this Deed shall prevail.

 

45

	6.3  	
      If
      any term of this Deed is deemed illegal, invalid or unenforceable in any
      jurisdiction, that shall not affect:

 

	6.3.1  	
      the
      legality, validity or enforceability in that jurisdiction of any other
      term of this Deed; or

 

	6.3.2  	
      the
      legality, validity or enforceability in other jurisdictions of that term
      or any other term of this Deed.

 

	6.4  	
      This
      Deed shall be binding upon and inure for the benefit of the parties
      hereto, their successors and assigns. It is the intention of the parties
      hereto that this Deed shall be binding to the maximum extent permitted by
      law upon their successors and assigns, an appointed liquidator for any
      such companies or other trustee or agent for creditors in connection with
      any insolvency proceedings.

 

	6.5  	
      This
      Deed must not be modified, amended or supplemented except in writing
      signed by each of the parties hereto. 

 

	6.6  	
      This
      Deed may be executed in two or more counterparts each of which shall be
      deemed to be an original and which together shall constitute one and the
      same instrument.

 

	6.7  	
      The
      parties shall each bear their own costs in connection with the
      preparation, negotiation, execution and implementation of this
      Deed.

 

	6.8  	
      Except
      as set out in this Clause 6.8, no public announcement of the terms of this
      Deed, the Settlement Agreement or their implementation shall be made (save
      by Corp and the TXUEL Officeholders as permitted by the Settlement
      Agreement). Each party to this Deed agrees that it will make no public
      comment of a disparaging nature in relation to any other party in
      connection with the business or affairs of any member of the TXUE Group.
      The parties to this Deed acknowledge that Corp will have an entitlement to
      file a copy of this Deed with the Securities and Exchange Commission, and
      that the Operating Companies, Ireland 1 and German Finance will be
      entitled to make appropriate disclosure as part of their CVA documentation
      and to creditors’ committees and meetings of creditors and members and as
      otherwise required by law.

 

	7  	
      NOTICES

 

	7.1  	
      Any
      notice under this Deed shall be given by being duly transmitted to the
      following address by facsimile
transmission:

 

	7.1.1  	
      in
      the cases of any of the Operating Companies or Operating Company
      Officeholders named in Part I of Annex 1, to Ernst & Young LLP of 1
      More London Place, London SE1 2EF, facsimile number 020 7951 1345 (for the
      attention of Alan Bloom and Mike Rollings);

 

	7.1.2  	
      in
      the cases of Ireland 1, the Ireland 1 Officeholders, German Finance and
      the German Finance Officeholders, to Ernst & Young LLP of 1 More
      London Place, London SE1 2EF, facsimile number 020 7951 1345 (for the
      attention of Alan Bloom and Roy Bailey);

 

46

	7.1.3  	
      in
      the cases of TXUEL, the TXUEL Officeholders and any Operating Company or
      Operating Company Officeholders named in Parts II and III of Annex 1, to
      KPMG LLP of 8 Salisbury Square, London EC4Y 8BB, facsimile number 020 7694
      3011 (for the attention of Jim Tucker); and

 

	7.1.4  	
      in
      the case of Corp, to TXU Corp., 1601 Bryan Street, Dallas TX 75201, USA,
      facsimile number +1 214 812 6032 (for the attention of David
      Poole);

 

or such
other address and numbers as each such party may from time to time expressly
substitute for them by notice given to the other parties.

 

	7.2  	
      Any
      notice under this Deed will be deemed to be given when the relevant
      facsimile transmission is received in legible
form.

 

	8  	
      GOVERNING
      LAW AND JURISDICTION

 

	8.1  	
      This
      Deed shall be governed by and construed in accordance with English law.
      

 

	8.2  	
      The
      parties hereby irrevocably agree to submit to the exclusive jurisdiction
      of the High Court of England and Wales in respect of any dispute, action
      or proceeding arising out of or in connection with this Deed. Each party
      hereby irrevocably waives any objection which it might have at any time to
      the High Court being nominated as the forum to hear and determine any such
      dispute, action or proceeding and for such purpose agrees not to claim
      that such court is an inconvenient or inappropriate
  forum.

47

 

IN
WITNESS of which
this Deed has been duly executed and delivered on the date first appearing on
this Deed. 

 

SIGNED
as a
DEED
by     )

TXU
EUROPE GROUP PLC (in administration),  )

TXU
EUROPE ENERGY TRADING LIMITED  )

(in
administration),  )

TXU
EUROPE POWER LIMITED (in administration) )

TXU
UK LIMITED (in administration)   )

EASTERN
ELECTRICITY HOLDINGS LIMITED  )

(in
administration)   )

TXU
(UK) HOLDINGS LIMITED  )

(in
administration)   )

ENERGY
HOLDINGS (No.6) LIMITED  )

(in
administration)   )

each
acting by ALAN
BLOOM,  )

its Joint
Administrator acting as agent  )

and
without personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

 

Occupation ....................................

 

SIGNED
as a
DEED
by  )

TXU
EUROPE MERCHANT PROPERTIES LIMITED )

(in
liquidation)   )

TXU
EUROPE MERCHANT GENERATION LIMITED )

(in
liquidation)   )

TXU
EUROPE POWER DEVELOPMENT LIMITED )

(in
liquidation)   )

TXU
EUROPE (PARTINGTON) LIMITED  )

(in
liquidation)   )

TXU
EUROPE POWER PRODUCTION SERVICES  )

LIMITED
(in liquidation)  )

TXU
EUROPE LEASING (4) LIMITED  )

(in
liquidation)   )

TXU
EUROPE (BLADE) LIMITED  )

(in
liquidation)   )

TXU
EUROPE (BLADE NO.2) LIMITED  )

(in
liquidation)   )

TXU
EUROPE TRADING LIMITED  )

(in
liquidation)   )

48

TXU
EUROPE NATURAL GAS (TRADING) LIMITED )

(in
liquidation)   )

TXU
FINLAND HOLDINGS LIMITED  )

(in
liquidation)   )

TXU
GERMANY LIMITED  )

(in
liquidation)   )

TXU
EUROPE OVERSEAS FINANCE LIMITED  )

(in
liquidation)   )

TXU
EUROPE LEASING (5) LIMITED  )

(in
liquidation)   )

PRECIS
(2264) LIMITED  )

(in
liquidation)   )

TXU
EUROPE RENEWABLE GENERATION LIMITED )

(in
liquidation)   )

TXU
EUROPE IRELAND 1  )

(in
liquidation)  )

TXU
EUROPE GERMAN FINANCE B.V.  )

(in
liquidation)  )

each
acting by ALAN
BLOOM,  )

its Joint
Liquidator acting as agent  )

and
without personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

              
...................................

Occupation ....................................

 

 

 

SIGNED
as a
DEED
by  )

ANGLIAN
POWER GENERATORS LIMITED  )

(in
administration)   )

PETERBOROUGH
POWER LIMITED  )

(in
administration)   )

TXU
EUROPE POWER SERVICES LIMITED  )

(in
administration)   )

each
acting by JAMES
TUCKER,  )

its Joint
Administrator acting as agent and without   )

personal
liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

              
...................................

Occupation ....................................

 

49

SIGNED
as a
DEED
by  )

EASTERN
GROUP FINANCE LIMITED  )

(in
liquidation)   )

acting by
JAMES
TUCKER,  )

its Joint
Liquidator acting as agent and without   )

personal
liability, in the presence of:  )

 

 

 

 

 

Signature ...................................

Name ...................................

Address ...................................

              
...................................

Occupation ....................................

 

 

SIGNED
as a
DEED
by  )

TXU
DIRECT SALES LIMITED  )

(in
liquidation) acting
by MARTIN
FISHMAN,  )

its Joint
Liquidator acting as agent and without   )

personal
liability, in the presence of:  )

 

 

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ....................................

 

50

SIGNED as a
DEED
by  )

ALAN
BLOOM, in   )

his own
capacity and on behalf of   )

the
administrators or liquidators of:  )

TXU
Europe Group plc (in administration) )

TXU
Europe Energy Trading Limited (in administration) )

TXU
Europe Power Limited (in administration) )

TXU
UK Limited (in administration) )

Eastern
Electricity Holdings Limited (in administration) )

TXU
(UK) Holdings Limited (in administration) )

Energy
Holdings (No.6) Limited (in administration)  )

TXU
Europe Merchant Properties Limited (in liquidation) )

TXU
Europe Merchant Generation Limited (in liquidation) )

TXU
Europe Power Development Limited (in liquidation) )

TXU
Europe (Partington) Limited (in liquidation) )

TXU
Europe Power Production Services Limited )

(in
liquidation)  )

TXU
Europe Leasing (4) Limited (in liquidation) )

TXU
Europe (Blade) Limited (in liquidation) )

TXU
Europe (Blade No.2) Limited (in liquidation) )

TXU
Europe Trading Limited (in liquidation) )

TXU
Europe Natural Gas (Trading) Limited (in liquidation) )

TXU
Finland Holdings Limited (in liquidation) )

TXU
Germany Limited (in liquidation) )

TXU
Europe Overseas Finance Limited (in liquidation) )

TXU
Europe Leasing (5) Limited (in liquidation) )

Precis
(2264) Limited (in liquidation) )

TXU
Europe Renewable Generation Limited (in liquidation) )

TXU
Europe Ireland 1 (in liquidation) )

TXU
Europe German Finance B.V. (in liquidation) )

without
personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name    
 ...................................

Address ...................................

                
    ...................................

Occupation ....................................

 

51

SIGNED as a
DEED
by  )

JAMES
TUCKER, in  )

his own
capacity and on behalf of   )

the
administrators or liquidators of: )

TXU
Europe Limited (in administration) )

Anglian
Power Generators Limited (in administration) )

Peterborough
Power Limited (in administration) )

TXU
Europe Power Services Limited (in administration) )

Eastern
Group Finance Limited (in liquidation) )

without
personal liability, in the presence of:   )

 

 

 

Signature ...................................

Name  ...................................

Address ...................................

              
...................................

Occupation ....................................

 

SIGNED as a
DEED
by  )

MARTIN
FISHMAN, in  )

his own
capacity and on behalf of   )

ALAN
LOVETT, together being the liquidators of: )

TXU
Direct Sales Limited (in liquidation) )

without
personal liability, in the presence of:   )

 

 

 

Signature ...................................

Name  ...................................

Address ...................................

              
...................................

Occupation ....................................

 

52

 

SIGNED as a
DEED by
TXU
CORP.  )

acting by
Eric
H Peterson, Executive  )

Vice
President and General Counsel  )

of
TXU Corp., duly
authorised to   )

sign on
behalf of TXU Corp., in the presence of: )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ....................................

SIGNED as a
DEED by
TXU
EUROPE LIMITED  )

(in
administration) acting by
JAMES
TUCKER,  )

its Joint
Administrator acting as  )

agent and
without personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ....................................

53

Annex
1

Part
I

The
Operating Companies 

(EY
appointed Officeholders)

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe Group plc

       
	
       

      Administration

       
	
       

      03247622

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y, together with Philip
      Wallace and James Tucker of KPMG

       
	
       

      19
      November 2002

       

	
       

      TXU
      Europe Energy Trading Limited

       
	
       

      Administration

       
	
       

      03116221

       
	
       

      Joint
      Administrators: Alan Bloom, Roy Bailey and Gareth Hughes of
      E&Y

       
	
       

      19
      November 2002

       

	
       

      TXU
      Europe Power Limited

       
	
       

      Administration

       
	
       

      02353756

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      17
      February 2003

       

54

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      UK Limited

       
	
       

      Administration

       
	
       

      02937796

       
	
       

      Joint
      Administrators: Alan Bloom, Roy Bailey and Gareth Hughes of E&Y and
      Christopher Hughes of Talbot Hughes McKillop LLP2 

       
	
       

      19
      November 2002

       

	
       

      Eastern
      Electricity Holdings Limited

       
	
       

      Administration

       
	
       

      04191756

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      18
      September 2003

       

	
       

      TXU
      Europe Merchant Properties Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03181383

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

	
       

      TXU
      Europe Merchant Generation Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03116225

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

	
       

      TXU
      Europe Power Development Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02529347

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      19
      June 2003

       

	
       

      TXU
      Europe (Partington) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03210149

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      April 2003

       

	
       

      TXU
      Europe Power Production Services Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571895

       
	
       

      Joint
      Liquidators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      29
      January 2003

       

2  Christopher
Hughes appointed on 11 March 2004.

 

55

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      (UK) Holdings Limited

       
	
       

      Administration

       
	
       

      02907433

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      27
      August 2003

       

	
       

      Energy
      Holdings (No.6) Limited

       
	
       

      Administration

       
	
       

      04191744

       
	
       

      Joint
      Administrators: Alan Bloom and Roy Bailey of E&Y

       
	
       

      18
      September 2003

       

	
       

      TXU
      Europe Leasing (4) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02969719

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe (Blade No.2) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04165891

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      11
      July 2003

       

	
       

      TXU
      Europe (Blade) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04195832

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe Trading Limited

       
	
       

      Liquidation
      (MVL)

       
	
       

      03431927

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      April 2003

       

	
       

      TXU
      Europe Natural Gas (Trading) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02937812

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      11
      July 2003

       

	
       

      TXU
      Finland Holdings Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571911

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

56

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Germany Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03571857

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      TXU
      Europe Overseas Finance Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03116229

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      24
      July 2003

       

	
       

      TXU
      Europe Leasing (5) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02512605

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      Precis
      (2264) Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      04487349

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      August 2003

       

	
       

      TXU
      Europe Renewable Generation Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03300836

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      20
      October 2004

       

	
       

      TXU
      Direct Sales Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      03181389

       
	
       

      Joint
      Liquidators: Alan Lovett and Martin Fishman of E&Y

       
	
       

      30
      September 2003

       

 

57

Part
II

The
Operating Companies 

(KPMG
appointed Officeholders)

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      Eastern
      Group Finance Limited

       
	
       

      Liquidation
      (CVL)

       
	
       

      02937764

       
	
       

      Joint
      Liquidators: James Tucker and Jeremy Spratt of KPMG LLP

       
	
       

      30
      September 2003

       

Part
III

The
Operating Companies

(KPMG
appointed Officeholders)

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      Anglian
      Power Generators Limited

       
	
       

      Administration

       
	
       

      02488955

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

	
       

      Peterborough
      Power Limited

       
	
       

      Administration

       
	
       

      02353599

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

	
       

      TXU
      Europe Power Services Limited

       
	
       

      Administration

       
	
       

      03568319

       
	
       

      Joint
      Administrators: James Tucker and Philip Wallace of KPMG LLP

       
	
       

      26
      June 2003

       

58

Part
IV

Ireland
1 and German Finance Officeholders

	
       

      Company

       
	
       

      Status

       
	
       

      Company
      Number

       
	
       

      Operating
      Company Officeholders

       
	
       

      Petition
      Date

       

	
       

      TXU
      Europe German Finance B.V.

       
	
       

      Liquidation
      (CVL)

       
	
       

      27251472

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      Oct 2004

       

	
       

      TXU
      Europe Ireland 1

       
	
       

      Liquidation
      (CVL)

       
	
       

      316371

       
	
       

      Joint
      Liquidators: Alan Bloom, Roy Bailey and Elizabeth Bingham of
      E&Y

       
	
       

      22
      Oct 2004

       

59

 

  Schedule
7

 

Excluded
Company Deed of Release

 

Dated
[  ]

 

 

 

 

Between

 

 

EXCLUDED
COMPANY [AND ITS OFFICEHOLDERS]

 

TXU
EUROPE LIMITED (IN ADMINISTRATION) AND ITS OFFICEHOLDERS

 

 

and

 

 

TXU
CORP.

 

 

 

 

______________________________________

 

EXCLUDED
COMPANY DEED OF RELEASE

______________________________________

                            

 

 

Cadwalader

 

Cadwalader,
Wickersham & Taft LLP

 

265
Strand

 

London,
WC2R 1BH

 

 

Tel: +44
(0) 20 7170 8700

Fax: +44
(0) 20 7170 8600 

Ref:
YC/95977.001

60

 

	 	
      TABLE
      OF CONTENTS

       
	
      Page

       

	
      1

       
	
      INTERPRETATION

       
	
      2

       

	
      2

       
	
      RELEASES

       
	
      2

       

	
      3

       
	
      FURTHER
      ASSURANCE

       
	
      3

       

	
      4

       
	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT

       
	
      3

       

	
      5

       
	
      OFFICEHOLDERS
      NOT PERSONALLY LIABLE

       
	
      3

       

	
      6

       
	
      MISCELLANEOUS

       
	
      4

       

	
      7

       
	
      NOTICES

       
	
      5

       

	
      8

       
	
      GOVERNING
      LAW AND JURISDICTION

       
	
      5

       

	
      Annex
      1 The Excluded Company Officeholders

       
	
      8

       

61

 

 

THIS
DEED is made
the [  ] day of [  ] 200[  ]

 

BETWEEN:

 

	(1)  	
      [Excluded
      Company], a company incorporated in [ ] and having its registered office
      at [ ] (the “Excluded
      Company”),
      [acting by the officeholders named in Annex 1], as agents without personal
      liability (the “Excluded
      Company Officeholders”)];

 

	(2)  	
      [The
      Excluded Company Officeholders];

 

	(3)  	
      TXU
      Europe Limited (in administration), a company incorporated in England and
      Wales with company number 03505836, acting by its joint administrators as
      agents without personal liability and having its registered office at 8
      Salisbury Square, London EC4Y 8BB (“TXUEL”);

 

	(4)  	
      The
      joint administrators of TXUEL, James R Tucker and Philip W Wallace of KPMG
      LLP of 8 Salisbury Square, London EC4Y 8BB, each acting as agent without
      personal liability (the “TXUEL
      Officeholders”);
      and

 

	(5)  	
      TXU
      Corp., a corporation incorporated under the laws of Texas in the United
      States of America and having its registered
      office at Energy Plaza, 1601 Bryan Street, Dallas, Texas 75201, USA
      (“Corp”).

 

WHEREAS:

 

	(A)  	
      Capitalised
      terms used but not defined in these recitals have the respective meanings
      set out above or as specified in Clause 1.1 of this
  Deed.

 

	(B)  	
      Certain
      companies in the TXUE Group have put Corp, certain of the Corp Persons and
      certain of the TXUE Persons on notice of claims any or all of them have or
      may have against any or all of Corp, the Corp Persons and the TXUE
      Persons. Each of Corp, the Corp Persons and the TXUE Persons denies
      liability in respect of all such claims.

 

	(C)  	
      The
      Holding Companies and the KPMG Officeholders have entered into a
      settlement agreement dated on or about 27 January 2005 with Corp, the Corp
      Persons and the TXUE Persons (the “Settlement
      Agreement”).
      Pursuant to the terms of the Settlement Agreement releases, waivers and
      discharges will be granted by each of Corp, the Corp Persons and the TXUE
      Persons for the benefit of, amongst others, the Excluded Company and the
      Excluded Company Officeholders, subject to the satisfaction of certain
      conditions.

 

	(D)  	
      It
      is a condition to the effectiveness of said releases that the Excluded
      Company and its Excluded Company Officeholders (if any) execute and
      deliver this Deed on the terms set out
below.

 

	(E)  	
      TXUEL,
      the TXUEL Officeholders and Corp wish to be parties to this Deed for the
      purposes of enforcement thereof.

62

 

 

NOW
IT IS AGREED as
follows:

 

	1  	
      INTERPRETATION

 

	1.1  	
      Capitalised
      terms used but not defined in this Deed have the respective meanings
      defined in the Settlement Agreement, save where specified or where the
      context otherwise requires.

 

	1.2  	
      References
      herein to any numbered Section, Part, Clause, or Annex without further
      designation shall, unless the context otherwise requires, be construed as
      a reference to the section, part or clause of or annex to this Deed as so
      numbered.

 

	1.3  	
      Annexes
      to this Deed form part of and are deemed to be incorporated in this
      Deed.

 

	1.4  	
      Section
      headings of and in any Annex to this Deed are for convenience only and
      shall not be taken into account in the interpretation of this
      Deed.

 

	1.5  	
      References
      in this Deed to any statute or statutory provision shall mean that statute
      or statutory provision as amended and in force as at the date of this
      Deed.

 

	1.6  	
      Words
      used in this Deed importing the plural shall include the singular and vice
      versa.

 

	1.7  	
      The
      term “person” when used in this Deed shall include an individual, a firm,
      a body corporate, an unincorporated association, a partnership and a
      person’s legal personal representatives or
successors.

 

	1.8  	
      Statements
      contained in the recitals to this Deed shall be considered in the
      interpretation of this Deed.

 

	2  	
      RELEASES

 

	2.1  	
      The
      terms of this Section 2 shall become effective subject to and immediately
      upon the later of:

 

	2.1.1  	
      receipt
      of the Settlement Sum and the Reimbursement Sums in accordance with
      Section 2 of the Settlement Agreement; and

 

	2.1.2  	
      the
      execution of this Deed by all parties
hereto.

 

	2.2  	
      In
      consideration of the releases, waivers and discharges to be given to [it
      ][them] under Section 5 of the Settlement Agreement [each of] the Excluded
      Company [and the Excluded Company Officeholders] hereby irrevocably
      releases, waives and discharges, to the maximum extent permitted by law,
      any and all Claims it has or may have against any or all
    of:

 

	2.2.1  	
      the
      TXUE Persons;

 

	2.2.2  	
      the
      TXUE Third Parties;

 

	2.2.3  	
      Corp;

63

 

 

	2.2.4  	
      the
      Corp Persons; and

 

	2.2.5  	
      the
      Corp Third Parties.

 

	2.3  	
      TXUEL
      and Corp agree they shall not consent to any amendment or supplement to
      Section 5 of the Settlement Agreement without first having obtained the
      consent of the Excluded Company and its Excluded Company Officeholders (if
      any).

 

	3  	
      FURTHER
      ASSURANCE

 

Each
party shall at its own cost do and execute or procure to be done and executed
all necessary acts, deeds, documents and things reasonably within its power to
give effect to this Deed.

 

	4  	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT

 

	4.1  	
      It
      is expressly intended and agreed by the parties that each
    of:

 

	4.1.1  	
      the
      TXUE Persons;

 

	4.1.2  	
      the
      TXUE Third Parties;

 

	4.1.3  	
      the
      Corp Persons; and

 

	4.1.4  	
      the
      Corp Third Parties,

 

shall be
entitled in its own right to enforce such releases, waivers and discharges as
may be given to it and become effective under the terms of this Deed by virtue
of and in accordance with the Contracts (Rights of Third Parties) Act
1999.

 

	4.2  	
      With
      the exception of the persons referred to in Clause 4.1, a person who is
      not a party to this Deed may not enforce any of its terms under the
      Contracts (Rights of Third Parties) Act
1999.

 

	4.3  	
      No
      consent of any third party (including for the avoidance of doubt, any
      person referred to in Clause 4.1) shall be required to amend, waive,
      substitute or supplement any provisions of this
Deed.

 

	4.4  	
      The
      parties to this Deed may rescind or vary this Deed or any of its terms
      without the consent of any person referred to in Clause 4.1, even if the
      rights of any such person under Clause 4.1 shall, by reason of such
      rescission or variation, be extinguished or
altered.

 

	5  	
      OFFICEHOLDERS
      NOT PERSONALLY LIABLE

 

	5.1  	
      This
      Deed is entered into by [the Excluded Company Officeholders and] the TXUEL
      Officeholders as agents, in each case, without personal liability.
      

64

 

 

	5.2  	
      The
      Parties to this Deed acknowledge and agree that:

 

	5.2.1  	
      none
      of the Excluded Company Officeholders (if any), the TXUEL Officeholders
      nor their respective firms, fellow members, partners, employees, agents,
      advisers or representatives shall incur any personal liability under, or
      by virtue of, this Deed, nor in relation to any related matter or claim
      howsoever, whenever and wherever arising, and whether such claim is
      formulated in contract and/or tort or by reference to any other remedy or
      right, and in whatever jurisdiction or
forum;

 

	5.2.2  	
      none
      of the Excluded Company Officeholders (if any), the TXUEL Officeholders
      nor their respective firms, fellow members, partners, employees, agents,
      advisers or representatives has given or entered into any collateral
      undertakings, representations, warranties or deeds in connection with this
      Deed; 

 

	5.2.3  	
      save
      as specified above, the Excluded Company Officeholders (if any) and the
      TXUEL Officeholders are parties to this Deed in their personal capacities
      solely for the purpose of receiving the benefit of the exclusions,
      limitations, undertakings, covenants and releases in their favour as
      provided in or effected by this Deed; and

 

	5.2.4  	
      nothing
      in this Deed shall operate to restrict or affect in any way any right of
      the Excluded Company Officeholders (if any) or the TXUEL Officeholders to
      an indemnity or assurance to which by law they are
    entitled.

 

	6  	
      MISCELLANEOUS

 

	6.1  	
      This
      Deed constitutes the whole agreement between the parties hereto relating
      to its subject matter.

 

	6.2  	
      This
      Deed supersedes any other agreement or arrangement entered into between
      the parties with respect to the subject matter hereof and, to the extent
      that any other agreement or arrangement has been entered into by any party
      which contains provisions inconsistent with the terms of this Deed, the
      terms of this Deed shall prevail.

 

	6.3  	
      If
      any term of this Deed is deemed illegal, invalid or unenforceable in any
      jurisdiction, that shall not affect:

 

	6.3.1  	
      the
      legality, validity or enforceability in that jurisdiction of any other
      term of this Deed; or

 

	6.3.2  	
      the
      legality, validity or enforceability in other jurisdictions of that term
      or any other term of this Deed.

 

	6.4  	
      This
      Deed shall be binding upon and inure for the benefit of the parties
      hereto, their successors and assigns. It is the intention of the parties
      hereto that this Deed shall be binding to the maximum extent permitted by
      law upon their successors and assigns, an appointed liquidator for any
      such companies or other trustee or agent for creditors in connection with
      any insolvency proceedings. 

 

	6.5  	
      This
      Deed shall not be modified, amended or supplemented except in writing
      signed by each of the parties hereto. 

 

65

	6.6  	
      This
      Deed may be executed in two or more counterparts each of which shall be
      deemed to be an original and which together shall constitute one and the
      same instrument.

 

	6.7  	
      The
      parties shall each bear their own costs in connection with the
      preparation, negotiation, execution and implementation of this
      Deed.

 

	6.8  	
      Except
      as set out in this Clause 6.8, no public announcement of the terms of this
      Deed, the Settlement Agreement or their implementation shall be made (save
      by Corp and the TXUEL Officeholders as permitted by the Settlement
      Agreement). Each party to this Deed agrees that it will make no public
      comment of a disparaging nature in relation to any other party in
      connection with the business or affairs of any member of the TXUE Group.
      The parties to this Deed acknowledge that Corp will have an entitlement to
      file a copy of this Deed with the Securities and Exchange Commission, and
      that the Excluded Company will be entitled to make appropriate disclosure
      as part of any CVA documentation and to creditors’ committees and meetings
      of creditors and members and as otherwise required by
  law.

 

	7  	
      NOTICES

 

	7.1  	
      Any
      notice under this Deed shall be given by being duly transmitted to the
      following address by facsimile
transmission:

 

	7.1.1  	
      in
      the cases of the Excluded Company and the Excluded Company Officeholders
      (if any), to the address and facsimile number specified, and for the
      attention of the person named, in Annex 1;

 

	7.1.2  	
      in
      the cases of TXU Europe Limited and the TXUEL Officeholders, to KPMG LLP
      of 8 Salisbury Square, London EC4Y 8BB, facsimile number 020 7694 3011
      (for the attention of Jim Tucker); and

 

	7.1.3  	
      in
      the case of Corp, to TXU Corp., 1601 Bryan Street, Dallas TX 75201, USA,
      facsimile number +1 214 812 6032 (for the attention of David
      Poole);

 

or such
other address and numbers as each such party may from time to time expressly
substitute for them by notice given to the other parties.

 

	7.2  	
      Any
      notice under this Deed will be deemed to be given when the relevant
      facsimile transmission is received in legible
form.

 

	8  	
      GOVERNING
      LAW AND JURISDICTION

 

	8.1  	
      This
      Deed shall be governed by and construed in accordance with English law.
      

 

	8.2  	
      The
      parties hereby irrevocably agree to submit to the exclusive jurisdiction
      of the High Court of England and Wales in respect of any dispute, action
      or proceeding arising out of or in connection with this Deed. Each party
      hereby irrevocably waives any objection which it might have at any time to
      the High Court being nominated as the forum to hear and determine any such
      dispute, action or proceeding and for such purpose agrees not to claim
      that such court is an inconvenient or inappropriate
  forum.

66

 

IN
WITNESS of which
this Deed has been duly executed and delivered on the date first appearing on
this Deed. 

 

SIGNED
as a
DEED
by  )

[details
of Excluded Company]
acting by  )

its joint
administrators[/liquidators],  )

as agents
and without personal liability[/directors],  )

in the
presence of:  )

 

Signature ................................

Name ................................

Address ................................

               
................................

Occupation .................................

 

 

 

 

 

 

 

[SIGNED as a
DEED by
[EXCLUDED
  )

COMPANY
OFFICEHOLDER], in his
own  )

capacity
and on behalf of [OTHER
EXCLUDED  )

COMPANY
OFFICEHOLDERS],  )

without
personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

             
...................................

Occupation ...................................]

 

 

 

67

SIGNED
as a
DEED by
TXU
EUROPE LIMITED  )

(in
administration) acting by
JAMES
TUCKER,  )

its joint
administrator acting as agent  )

and
without personal liability, in the presence of:  )

 

Signature .................................

Name .................................

Address .................................

               
.................................

Occupation .................................

 

SIGNED as a
DEED by
JAMES
TUCKER, in his
own  )

capacity
and on behalf of the administrators of   )

TXU
EUROPE LIMITED (in administration),  )

without
personal liability, in the presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

              
...................................

Occupation ...................................

 

SIGNED
as a
DEED
by
TXU CORP.,  )

acting by
Eric
H Peterson,
Executive
Vice  )

President
and General Counsel of TXU Corp.,
  )

duly
authorised to sign on behalf of TXU
Corp.,
  )

in the
presence of:  )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ...................................

 

68

Annex
1

Excluded
Company Officeholders

69

Schedule
8

Terms
of Holding Company CVA Creditor Release

 

 

Terms of
a Holding Company CVA providing, to the extent permitted by law,
for:

 

	
      (a)
	
      The
      release, waiver and discharge of any and all Claims that any and all of
      the CVA Creditors of the relevant Holding Company have or may have solely
      by virtue of or arising out of their capacities as CVA Creditors (and, for
      the avoidance of doubt, not by virtue of or arising out of any other
      capacities they may have) against any or all of Corp, the Corp Persons,
      the Corp Third Parties, the TXUE Persons, the TXUE Third Parties and,
      solely in respect of Claims arising by virtue of acts or omissions on or
      before 19 November 2002, any person not specified previously who acted as
      arranger, manager, trustee, registrar, dealer in respect of a bond or note
      programme, agent or adviser in respect of indebtedness of any member of
      the TXUE Group;

 

	
      (b)
	
      Covenants
      by all CVA Creditors of the relevant Holding Company and on behalf of
      their successors and assigns not to support (financially or otherwise),
      sanction or procure the sanction of, assist or join with the KPMG
      Officeholders or any Officeholders in either the pursuit of any Statutory
      Claims or any assignment of the proceeds thereof (save as specified in (d)
      below) or the commencement of a winding-up, dissolution or any other
      insolvency proceeding in relation to the relevant Holding
      Company;

 

	
      (c)
	
      A
      declaration by all CVA Creditors of the relevant Holding Company
      constituting an immediate trust in favour of Corp of the right of any and
      all of the CVA Creditors to receive any distribution consequential upon or
      attributable to the pursuit of any Statutory Claim, and the appointment of
      such Holding Company as the sole trustee in respect of such trust, which
      appointment is to be thereby accepted by such Holding
    Company;

 

	
      (d)
	
      The
      assignment by any and all CVA Creditors of the relevant Holding Company
      (expressed in terms to be binding on their successors and assigns) of any
      right they may have to receive any distribution consequential upon or
      attributable to the pursuit of any Statutory Claim and/or the proceeds of
      any such distribution (whether such right arises as a consequence of the
      failure of the trust provided for in (c) above or otherwise) to Corp or
      such other person as Corp may direct and without any payments being made
      or sought by or from any person in relation to the said
      assignments;

 

(on
the basis that the terms described in (c) and (d) above shall not include,
constitute or effect a declaration of trust over or an assignment of any
underlying Claims against the relevant Holding Company);
and

 

	
      (e)
	
      Corp,
      Corp Persons, Corp Third Parties, TXUE Persons, the TXUE Third Parties and
      the persons specified thereafter in (a) above to be entitled to enforce
      the benefit of each of the provisions set out above in their favour
      pursuant to the Contracts (Rights of Third Parties) Act
    1999.

 

  

 

Schedule 9

Principal
Creditors

 

 

Aegon USA
Investment Management, LLC

Appaloosa
Investment Limited Partnership I

Appaloosa
Management L.P.

Banc of
America Securities Limited

Barclays
Bank PLC

D.K.
Acquisition Partners LP

Deutsche
Bank AG (London Branch)

Deutsche
Bank International Limited 

Deutsche
Bank Luxembourg S.A.

Goldman
Sachs Credit Partners L.P.

Greywolf
Loan Participation LLC

King
Street Capital, L.P.

King
Street Capital, Ltd.

M&G
Investment Management Limited

M.H.
Davidson & Co, LLC

Morgan
Stanley Bank International Limited

Morgan
Stanley Capital Services Inc. 

Morgan
Stanley & Co. International limited

Primerica
Life Insurance Company

Redwood
Capital

The
Travelers Life and Annuity Company

The
Travelers Insurance Company

Värde
Partners, Inc.

 

  

71

 

 

Schedule 10

Principal
Creditor Deed of Release

 

Dated
[  ]

 

 

Between

 

 

[PRINCIPAL
CREDITOR]

 

 

CORP
PERSONS

 

 

TXUE
PERSONS

 

 

and

 

 

TXU
CORP.

 

 

__________________________________

PRINCIPAL
CREDITOR DEED OF RELEASE

__________________________________

 

 

Cadwalader

 

Cadwalader,
Wickersham & Taft LLP

265
Strand

London,
WC2R 1BH

 

 

Tel: +44
(0) 20 7170 8700

Fax: +44
(0) 20 7170 8600 

Ref:
YC/95977.001

72

 

	 	
       

      TABLE
      OF CONTENTS
	 
	
       

      1
	
       

      INTERPRETATION
	
       

      2

	
       

      2
	
       

      RELEASES
	
       

      3

	
       

      3
	
       

      REPRESENTATIONS
      AND WARRANTIES
	
       

      3

	
       

      4
	
       

      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT
	
       

      5

	
       

      5
	
       

      TERMINATION
	
       

      5

	
       

      6
	
       

      MISCELLANEOUS
	
       

      5

	
       

      7
	
       

      NOTICES
	
       

      6

	
       

      8
	
       

      GOVERNING
      LAW AND JURISDICTION
	
       

      7

	
       

      Annex
      1 The Corp Persons
	
       

      11

	
       

      Annex
      2 The TXUE Persons
	
       

      12

	
       

      Annex
      3 The Lock-Up Agreement (without schedules)
	
       

      13

	
       

      Annex
      4 The Principal Creditor’s Debt
	
       

      14

73

 

THIS
DEED is made
the [ ] day of January 2005

 

BETWEEN:

 

	(1)  	
      [Principal
      Creditor],
      of [ ], acting solely in its capacity as a creditor of one or more of the
      Holding Companies or one or more of the Operating Companies (“Principal
      Creditor”);

 

	(2)  	
      The
      past or present directors, officers and employees of Corp named in Annex 1
      hereto, acting solely in their respective capacities as such (the
      “Corp
      Persons”);
      

 

	(3)  	
      The
      past or present directors, officers, employees and advisers of the Holding
      Companies and the Operating Companies named in Annex 2 hereto, acting
      solely in their capacities as such (the “TXUE
      Persons”);
      and

 

	(4)  	
      TXU
      Corp., a
      corporation incorporated under the laws of Texas in the United States of
      America and having its registered office at Energy Plaza, 1601 Bryan
      Street, Dallas, Texas 75201, USA (“Corp”).

 

WHEREAS:

 

	(A)  	
      Capitalised
      terms used below have the respective meanings set out above or as
      specified in Section 1 of this Deed.

 

	(B)  	
      The
      Holding Companies and the KPMG Officeholders have entered, or intend to
      enter, into a settlement agreement dated on or about 27 January 2005 with
      Corp, the Corp Persons and the TXUE Persons (the “Settlement
      Agreement”). It
      is or will be a condition precedent to the payment by Corp of sums under
      the Settlement Agreement that the Principal Creditor execute this Deed of
      Release.

 

	(C)  	
      Certain
      creditors of the TXUE Group have put Corp, certain of the Corp Persons and
      certain of the TXUE Persons on notice of claims that they have or may have
      against any and all of Corp, the Corp Persons and the TXUE
      Persons.
      Each of Corp, the Corp Persons and the TXUE Persons denies liability in
      respect of all such claims.

 

	(D)  	
      The
      KPMG Officeholders intend to propose CVAs for certain of the Holding
      Companies, including the Core Holding Company CVAs, each to be considered
      by meetings of members and creditors to be convened on or
      before 30
      April 2005. The Principal Creditor is or will become bound to vote its
      Debt in favour of the KPMG Officeholders’ proposals for Core Holding
      Company CVAs by and subject to the terms of the Lock-Up
      Agreement.

 

	(E)  	
      Subject
      to the terms of this Deed, the parties wish to agree a full and final
      settlement for all purposes of all matters arising out of or in relation
      to the conduct of Corp, the Corp Persons and the TXUE Persons in
      connection with the business or affairs of any member of the TXUE Group
      and all losses and potential losses suffered or alleged to be suffered by
      the Principal Creditor.

74

 

NOW
IT IS AGREED as
follows:

 

	1  	
      INTERPRETATION

 

	1.1  	
      Capitalised
      terms used but not defined in this Deed have the respective meanings
      defined in the Settlement Agreement, save where specified or where the
      context otherwise requires. In addition, the following capitalised terms
      used in this Deed have the following
meanings:

 

“Debt” means
the total amount of the claims of the Principal Creditor against any of the
Holding Companies, whether in respect of bonds, obligations under the Revolving
Credit Facility or otherwise (including for the avoidance of doubt in respect of
any guarantees and indemnities); 

 

“Lock-Up
Agreement” means
the lock-up agreement between TXUEL, the Principal Creditor and others as
executed and dated on or about the date hereof and attached (without schedules)
at Annex 3; and 

 

“Revolving
Credit Facility” means
the £900 million revolving credit facility agreement between TXUEL as a borrower
and guarantor, Barclays Capital, J.P. Morgan Plc, Salomon Brothers International
Limited and The Royal Bank of Scotland plc as arrangers, the financial
institutions named in schedule 1 thereto as original lenders, The Royal Bank of
Scotland plc as the LC issuing bank and J.P. Morgan Europe Limited (formerly
Chase Manhattan International Limited) as facility agent dated 19 November 2001
(as supplemented, amended and restated from time to time).

 

	1.2  	
      References
      herein to any numbered Section, Part, Clause or Annex without further
      designation shall, unless the context otherwise requires, be construed as
      a reference to the section, part or clause of or annex to this Deed as so
      numbered.

 

	1.3  	
      Annexes
      to this Deed form part of and are deemed to be incorporated in this
      Deed.

 

	1.4  	
      Section
      headings of and in any Annex to this Deed are for convenience only and
      shall not be taken into account in the interpretation of this
      Deed.

 

	1.5  	
      References
      in this Deed to any statute or statutory provision shall mean that statute
      or statutory provision as amended and in force as at the date of this
      Deed.

 

	1.6  	
      Words
      used in this Deed importing the plural shall include the singular and vice
      versa.

 

	1.7  	
      The
      term “person” when used in this Deed shall include an individual, a firm,
      a body corporate, an unincorporated association, a partnership and a
      person’s legal personal representatives or
successors.

 

	1.8  	
      Statements
      contained in the recitals to this Deed shall be considered in the
      interpretation of this Deed.

75

 

 

	2  	
      RELEASES

 

	2.1  	
      The
      terms of this Section 2 shall become effective subject to and immediately
      upon receipt of the Settlement Sum and the Reimbursement Sums in
      accordance with Section 2 of the Settlement Agreement. For the avoidance
      of doubt, nothing in this Deed shall operate to waive, discharge, release
      or in any way prejudice
      any of the Claims referred to in Section 2 of this Deed prior to the
      receipt of the Settlement Sum and the Reimbursement Sums in accordance
      with Section 2 of the Settlement Agreement.

 

	2.2  	
      In
      consideration of and conditional upon receipt of the Settlement Sum and
      the Reimbursement Sums in accordance with Section 2 of the Settlement
      Agreement and the releases to be given to it hereunder, the Principal
      Creditor hereby irrevocably releases, waives and discharges any and all
      Claims it has or may have solely by virtue of or arising out of its
      capacity as a creditor of one or more of the Holding Companies or one or
      more of the Operating Companies against any or all
of:

 

	2.2.1  	
      Corp;

 

	2.2.2  	
      the
      Corp Persons;

 

	2.2.3  	
      the
      Corp Third Parties;

 

	2.2.4  	
      the
      TXUE Persons;

 

	2.2.5  	
      the
      TXUE Third Parties;
      and

 

	2.2.6  	
      solely
      in respect of Claims arising by virtue of acts or omissions on or before
      19 November 2002, any person not otherwise specified in this Clause 2.2
      who acted as arranger, manager, trustee, registrar, dealer in respect of a
      bond or note programme, agent or adviser in respect of indebtedness of any
      member of the TXUE Group.

 

	2.3  	
      In
      consideration of the releases, waivers and discharges to be given to them
      hereunder, each of Corp, the Corp Persons and the TXUE Persons hereby
      irrevocably releases, waives and discharges any and all Claims it has or
      may have against the Principal Creditor.

 

	2.4  	
      For
      the avoidance of doubt:

 

	2.4.1  	
      nothing
      in this Deed is intended to prejudice the effectiveness of any discharge,
      waiver or release of Claims given by the Principal Creditor pursuant to
      the terms of a CVA Creditor Release in a Holding Company CVA;
      and

76

 

 

	2.4.2  	
      nothing
      in this Deed is intended to effect a release, waiver or discharge of any
      Claims that the Principal Creditor has or may have by virtue of or arising
      out of any capacity other than as a creditor of one or more of the Holding
      Companies or one or more of the Operating Companies, including without
      limitation that of an arranger, manager, trustee, registrar, dealer in
      respect of a bond or note programme, agent or
adviser.

 

	3  	
      REPRESENTATIONS,
      WARRANTIES
      AND UNDERTAKINGS

 

	3.1  	
      The
      Principal Creditor represents, warrants and
undertakes:

 

	3.1.1  	
      that
      on the date of this Deed it
      is the legal and/or beneficial owner of and/or the owner of the economic
      interest in the Debt as
      set out in Annex 4;

 

	3.1.2  	
      that
      from the date of this Deed until the earlier of (i) the Effective Date or
      (ii) termination of this Deed pursuant to Clause 5, it shall not sell,
      assign, sub-participate or transfer an interest in all or any part of the
      Debt unless before such transfer:

 

	(a)  	
      the
      proposed transferee enters into a Principal Creditor Deed of Release;
      and

 

	(b)  	
      the
      Principal Creditor provides a certified copy of the executed Principal
      Creditor Deed of Release referred to in 3.1.2(a) above to
      Corp.

 

	3.2  	
      Each
      of the Principal Creditor and Corp represents, warrants and undertakes
      that:

 

	3.2.1  	
      it
      has the power, capacity and authority to execute this Deed and to exercise
      its rights and perform its obligations hereunder and that all corporate
      and other action required to authorise the execution of this Deed and the
      performance of its obligations hereunder has been duly
    taken;

 

	3.2.2  	
      it
      has, or has provided all consents and any other necessary authorisations
      and approvals required to enable it, or its authorised representative,
      lawfully to enter into, execute, perform and comply with its obligations
      under this Deed and such authorisations, consents and approvals are in
      full force and effect;

 

	3.2.3  	
      to
      the best of its knowledge, information and belief, no steps have been
      taken for the revocation or cancellation of any necessary consents,
      authorisations and approvals; 

 

	3.2.4  	
      all
      other acts, conditions and things required to be done, fulfilled and
      performed in order (i) to enable it to lawfully enter into and to exercise
      its rights under and perform the obligations assumed by it in this Deed
      and (ii) to ensure that the obligations expressed to be assumed by it in
      the Deed are legal, valid and binding have been done, fulfilled and
      performed; and

 

	3.2.5  	
      it
      has not entered into any pending agreements, transactions or negotiations
      that would render this Deed, or any part of it, void, voidable or
      unenforceable.

 

77

	3.3  	
      Each
      of the Corp Persons and the TXUE Persons represents, warrants and
      undertakes that:

 

	3.3.1  	
      it
      has the necessary power, capacity and authority to execute, (including,
      where applicable, on behalf of other parties to this Deed) and perform its
      obligations under this Deed; and

 

	3.3.2  	
      this
      Deed is valid and binding upon it in accordance with its
      terms.

 

	3.4  	
      Each
      of the parties acknowledges and agrees that, save as expressly referred to
      herein, in entering into this Deed it has not relied on any statement,
      representation or silence of any other party to this
  Deed.

 

	4  	
      CONTRACTS
      (RIGHTS OF THIRD PARTIES) ACT

 

	4.1  	
      It
      is expressly intended and agreed by the parties that each of the TXUE
      Third Parties, the Corp Third Parties and the persons specified in Clause
      2.2.6 shall be entitled in its own right to enforce such releases, waivers
      and discharges as may be given to it and become effective under the terms
      of this Deed by virtue of and in accordance with the Contracts (Rights of
      Third Parties) Act 1999.

 

	4.2  	
      With
      the exception of the persons referred to in Clause 4.1, a person who is
      not a party to this Deed may not enforce any of its terms under the
      Contracts (Rights of Third Parties) Act
1999.

 

	4.3  	
      No
      consent of any third party (including for the avoidance of doubt, any
      person referred to in Clause 4.1) shall be required to amend, waive,
      substitute or supplement any provisions of this
Deed.

 

	4.4  	
      The
      parties to this Deed may rescind or vary the Deed or any of its terms
      without the consent of any person referred to in Clause 4.1, even if the
      rights of any such person under Clause 4.1 shall, by reason of such
      rescission or variation, be extinguished or
altered.

 

	5  	
      TERMINATION

 

	5.1  	
      This
      Deed shall terminate in the event that the payment of the Settlement Sum
      and the Reimbursement Sums in accordance with Section 2 of the Settlement
      Agreement has not occurred on or before (i) 30 November 2005 or (ii) the
      making of any announcement or giving of any notice by the KPMG
      Officeholders of an intention not to proceed with the Core Holding Company
      CVAs.

 

	6  	
      MISCELLANEOUS

 

	6.1  	
      Subject
      to Clause 2.4.1, this Deed constitutes the whole agreement between the
      parties hereto relating to its subject
matter.

 

	6.2  	
      Subject
      to Clause 2.4.1, this Deed supersedes any other agreement or arrangement
      entered into between the parties with respect to the subject matter hereof
      and, to the extent that any other agreement or arrangement has been
      entered into by any party which contains provisions inconsistent with the
      terms of this Deed, the terms of this Deed shall
  prevail.

 

78

	6.3  	
      If
      any term of this Deed is deemed illegal, invalid or unenforceable in any
      jurisdiction, that shall not affect:

 

	6.3.1  	
      the
      legality, validity or enforceability in that jurisdiction of any other
      term of this Deed; or

 

	6.3.2  	
      the
      legality, validity or enforceability in other jurisdictions of that term
      or any other term of this Deed.

 

	6.4  	
      This
      Deed shall be binding upon and inure for the benefit of the parties
      hereto, their successors and assigns. It is the intention of the parties
      hereto that this Deed shall be binding upon their successors and assigns
      to the maximum extent permitted by law. 

 

	6.5  	
      This
      Deed must not be modified, amended or supplemented except in writing
      signed by each of the parties hereto. 

 

	6.6  	
      This
      Deed may be executed in two or more counterparts each of which shall be
      deemed to be an original and which together shall constitute one and the
      same instrument.

 

	6.7  	
      The
      parties shall each bear their own costs in connection with the
      preparation, negotiation, execution and implementation of this
      Deed.

 

	6.8  	
      Except
      as set out in this Clause 6.8, no public announcement of the terms of this
      Deed or the Settlement Agreement or their implementation shall be made
      (save by Corp as permitted by the Settlement Agreement). Each party to
      this Deed agrees that it will make no public comment of a disparaging
      nature in relation to any other party in connection with the business or
      affairs of any member of the TXUE Group. The parties to this Deed
      acknowledge that Corp and the Principal Creditor shall be entitled to make
      such disclosures as are required by law.

 

	7  	
      NOTICES

 

	7.1  	
      Any
      notice under this Deed shall be given by being duly transmitted to the
      following address by facsimile
transmission:

 

	7.1.1  	
      in
      the case of the Principal Creditor, to [ ] and marked for the attention of
      [ ]; 

 

	7.1.2  	
      in
      the cases of the TXUE Persons named in Part II of Annex 2, to Berwin
      Leighton Paisner, Adelaide House, London Bridge, London EC4R 9HA,
      facsimile number 020 7760 1111 (for the attention of
      BLAR/DAP/DUL/SJNS/21146/2);

 

	7.1.3  	
      in
      the cases of the TXUE Persons named in Part III of Annex 2, to Lovells,
      Atlantic House, Holborn Viaduct, London EC1A 2FG facsimile number 020 7296
      2001 (for the attention of Russell Sleigh/Jeremy Cole);
      and

 

79

	7.1.4  	
      in
      the cases of Corp and the TXUE Persons named in Part I of Annex 2, to TXU
      Corp., 1601 Bryan Street, Dallas TX 75201, USA, facsimile number +1 214
      812 6032 (for the attention of David
Poole);

 

or such
other address and numbers as each such party may from time to time expressly
substitute for them by notice given to the other parties.

 

	7.2  	
      Any
      notice under this Deed will be deemed to be given when the relevant
      facsimile transmission is received in legible
form.

 

	8  	
      GOVERNING
      LAW AND JURISDICTION

 

	8.1  	
      This
      Deed shall be governed by and construed in accordance with English
      law. 

 

	8.2  	
      The
      parties hereby irrevocably agree to submit to the exclusive jurisdiction
      of the High Court of England and Wales in respect of any dispute, action
      or proceeding arising out of or in connection with this Deed. Each party
      hereby irrevocably waives any objection which it might have at any time to
      the High Court being nominated as the forum to hear and determine any such
      dispute, action or proceeding and for such purpose agrees not to claim
      that such court is an inconvenient or inappropriate
  forum.

80

 

IN
WITNESS of which
this Deed has been duly executed and delivered on the date first appearing on
this Deed. 

SIGNED
as a
DEED by
[Principal
Creditor] )

acting by
[insert
name], )

duly
authorised to sign on behalf of
[Principal )

Creditor], in the
presence of: )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ....................................

 

SIGNED as a
DEED by
Eric
H Peterson,  )

Executive
Vice President and General  )

Counsel
of TXU Corp., duly
authorised  )

to sign
on behalf of the CORP
PERSONS,  )

in the
presence of:     )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ...................................

 

SIGNED as a
DEED by
TXU
CORP.,  )

acting by
Eric
H Peterson,
Executive  )

Vice
President and General Counsel  )

of
TXU Corp., duly
authorised to sign   )

on behalf
of TXU Corp., in the presence of: )

 

 

 

Signature ...................................

Name ...................................

Address ...................................

               
...................................

Occupation ...................................

81

 

SIGNED as a
DEED by
Eric
H Peterson,    )

Executive Vice-President
and General Counsel of )

TXU Corp., duly
authorised to sign on behalf of  )

the
TXUE
PERSONS named in
Part I of Annex  )

2 herein,
in the presence of:     )

 

 

 

Signature ...................................

Name  ...................................

Address ...................................

               
...................................

Occupation ...................................

 

 

 

 

SIGNED
as a
DEED by
BERWIN
LEIGHTON  )

PAISNER acting
by Benjamin M. Larkin, Partner, )

duly
authorised to sign on behalf of the
TXUE )

PERSONS named in
Part II of Annex 2, in the )

presence
of:

 

 

 

Signature ...................................

Name     
 ...................................

Address ...................................

               
...................................

Occupation ...................................

 

 

 

 

82

 

SIGNED as a
DEED by
LOVELLS acting
by   )

Russell
HP Sleigh, Partner, duly authorised to sign on  )

behalf of
Lovells and any of its partners or employees,  )

including
employees of Lovells Services Limited,   )

solely in
its and their capacities as former advisers to any )

or all of
the Holding Companies, in the presence of:  )

 

 

 

Signature ...................................

Name  ...................................

Address ...................................

               
...................................

Occupation ...................................

 

83

Annex
1

The
Corp Persons

Derek C
Bonham

Brian A
Dickie 

H Jarrell
Gibbs

Michael J
McNally

Erle A
Nye

Eric H
Peterson

Philip G
Turberville 

Robert A
Wooldridge 

Jerry S
Farrington

William M
Griffin

Kerney
Laday

Jack E
Little

Margaret
N Maxey

James E
Oesterreicher

Charles R
Perry

Herbert H
Richardson

Manu
Asthana

Thomas L
Baker

Andrew C
Cameron

John E
Crawford Jr.

John P
Gamino

Michael J
Garberding

Anthony R
Horton

Jerry D
Hunt

Kirk R
Oliver

Paul F
O’Malley

Stanley J
Szlauderbach

Peter B
Tinkham

Philip S
Toler

Max
Underwood

84

Annex
2

The
TXUE Persons

Part
I

Derek C
Bonham

Brian A
Dickie 

H Jarrell
Gibbs

Michael J
McNally

Erle A
Nye

Eric H
Peterson 

Philip G
Turberville 

Robert A
Wooldridge

Part
II

Henry
Birt

Howard
Goodbourn

Brian
Hutchinson

Paul C
Marsh

Martin
Murray

Roger
Partington

Willem
Smit

Martin S
W Stanley

Gary
Wiffin

Part
III

Lovells
and any of its partners or employees, including employees of Lovells Services
Limited, solely in its and their capacities as former advisers to any or all of
the Holding Companies.

85

Annex
3

The
Lock-Up Agreement (without schedules)

86

 

Annex
4

Principal
Creditor’s Debt (Clause 3.1)

 

87exhibit 10(yy)

Exhibit
10(yy)

 

MEMORANDUM
OF UNDERSTANDING

 

The
Settling Parties have reached an agreement in principle as set forth in this
Memorandum of Understanding (the "Memorandum") providing for the settlement and
dismissal with prejudice of the claims asserted in the Consolidated Securities
Action on the terms and subject to the conditions set forth below (the
"Settlement").1  This
Memorandum sets forth the principal terms of the Settlement, which will be
embodied and amplified in a Securities Settlement Agreement as described
below.

 

RECITALS

 

On and
after October 15, 2002, thirty securities Class Actions (collectively, the
"Securities Actions") were filed by the plaintiffs named herein on behalf of
themselves and all others similarly situated in (or transferred to) the United
States District Court for the Northern District of Texas, Dallas Division (the
"Federal Court"), against TXU Corp., Erle Nye, Michael J. McNally, Brian N.
Dickie, Biggs C. Porter, V.J. Horgan, Derek C. Bonham, J.S. Farrington, William
F. Griffin, Kerney Laday, Jack E. Little, Margaret N. Maxey, J.E. Oesterreicher,
Charles R. Perry and Herbert H. Richardson (collectively, “Defendants”)
..

 

By Order
dated May 8, 2003, the Federal Court consolidated the Securities Actions under
the caption Schwartz,
et al. v. TXU Corp., et al., Civil
Action No. 3:02-CV-2243-K (the "Consolidated Securities Action").

 

By Order
dated May 8, 2003, the Federal Court appointed the Plumbers & Pipefitters
National Pension Fund, Arthur C. Nielsen, Jr., and Ronald Canada (the
“Securities Plaintiffs”) as Lead Plaintiffs and appointed Lead Counsel in the
Consolidated Securities Action.

 

The
Settling Parties have engaged in substantial arm's length negotiations in an
effort to resolve all claims that have been, or could have been, asserted in the
Consolidated Securities Action, including conducting numerous meetings and
telephone conferences where the terms of the agreements detailed herein were
extensively debated and negotiated.

 

The
Securities Defendants have denied and continue to deny that they engaged in any
wrongdoing of any kind, or that they violated or breached any law, regulation,
or duty owed to the Securities Plaintiffs. They further deny that they have
liability as a result of any and all allegations contained in the Consolidated
Securities Action, and are entering into the Settlement to eliminate the
burdens, distractions, expense, and uncertainty of further
litigation.

___________________

1 All
capitalized terms not otherwise defined shall have the meaning set forth in
Section I below.

 

WHEREAS,
the terms and conditions of this Memorandum are the result of arm's length
negotiations between the Settling Parties and represent a fair and reasonable
resolution of the Consolidated Securities Action under all of the facts and
circumstances.

 

NOW,
THEREFORE, in consideration of the promises and agreements, covenants,
representations, and warranties set forth herein, intending to be legally
bound:

 

THE
SETTLING PARTIES STIPULATE AND AGREE AS FOLLOWS:

 

ADDITIONAL
DEFINITIONS

The
following additional definitions shall apply in this Memorandum:

 

(a) “Action”
means the Consolidated Securities Action. 

 

(b) "Effective
Date" means the date of completion of the following: (i) Court approval of the
dismissal of the claims that have been, or could have been, asserted in the
Action in all material respects AND EITHER (ii) expiration of the time to appeal
or otherwise seek review of the Order and Final Judgment which approves the
Settlement without any appeal having been taken or review sought; OR (iii) if an
appeal is taken or review sought, the expiration of five days after an appeal or
review shall have been finally determined by the highest court before which
appeal or review is sought and which upholds the terms of such appealed
settlement and/or an Order and Final Judgment and is not subject to further
judicial review.

 

(c) “TXU” or
the “Company” means TXU Corp. and its subsidiaries and affiliates, agents,
partnerships, joint ventures, and their assigns and successors in
interest.

 

(d) "Co-Lead
Plaintiffs' Counsel" means Lerach Coughlin Stoia Geller Rudman & Robbins LLP
and Provost & Umphrey Law Firm, LLP.

 

(e) “Settling
Parties” means the Securities Parties.

 

(f) “Securities
Defendants” means the TXU Defendants and the Underwriter
Defendants.

 

(g) “TXU
Defendants” means TXU, Erle Nye, Michael J. McNally, Brian N. Dickie, Biggs C.
Porter, V.J. Horgan, Derek C. Bonham, J.S. Farrington, William F. Griffin,
Kerney Laday, Jack E. Little, Margaret N. Maxey, J.E. Oesterreicher, Charles R.
Perry and Herbert H. Richardson.

 

(h) “Securities
Parties” means the Securities Plaintiffs and the Securities
Defendants.

 

(i) “Securities
Plaintiff Class” means all persons or entities who purchased the publicly traded
securities of TXU or entities affiliated therewith (collectively, the “TXU
Securities”) between April 26, 2001 and October 11, 2002 (the “Class Period”).
Excluded from the Securities Plaintiff Class are the Securities Defendants, as
well as officers and directors of TXU and its affiliates and subsidiaries and
the Underwriter Defendants, members of their immediate families, their
affiliates and those members of the Securities Plaintiff Class that timely and
validly exclude themselves from the Securities Plaintiff Class.

 

-2-

(j) “Underwriter
Defendants” means Merrill Lynch, Pierce, Fenner & Smith, Inc., Bank of
America Securities LLC, Credit Suisse First Boston Corporation, and Saloman
Smith Barney Inc.

 

(k) “Released
Securities Parties” means the Securities Defendants and their affiliates,
subsidiaries, assigns, officers, directors, employees, and agents, specifically
including the law firms, attorneys, auditors and insurers who were retained by
or rendered advice in connection with, the Action or the facts, circumstances
and events upon which the Action is based.

 

SETTLEMENT
TERMS FOR THE CONSOLIDATED SECURITIES ACTION

(i) Securities
Settlement Agreement. The
Settling Parties shall use all reasonable efforts, acting in good faith, to
agree upon, execute, and move the Federal Court for preliminary approval of a
mutually agreeable definitive settlement agreement and such other documentation
as may be required to obtain final approval of the settlement and release of the
claims that were, or could have been, asserted by Plaintiffs and the members of
the Securities Plaintiff Class against the Securities Defendants (the
"Securities Settlement") by the Federal Court within forty five (45) days of the
execution of this Memorandum (the "Securities Settlement Agreement"). The terms
of the Securities Settlement Agreement shall be consistent with the terms of
this Memorandum and shall provide:

 

1. for
acceptance of the terms contained in the “Settlement Term Sheet” attached hereto
as Schedule 1;

 

2. for the
creation, and presentation to the Federal Court for approval, of an appropriate
form of notice, proof of claim, and related materials;

 

3. that the
Securities Defendants have denied, and continue to deny, that they engaged in
any wrongdoing of any kind, or violated any law or regulation, or breached any
duty to the Securities Plaintiffs or the Securities Plaintiff Class, and
Defendants further deny that they have liability as a result of any and all
allegations contained in the Consolidated Securities Action, and are entering
into the Settlement to eliminate the burden, distraction, expense, and
uncertainty of further litigation;

 

4. for the
implementation of the various corporate governance changes detailed in Schedule
2 attached hereto;

 

5. acknowledgement
that the additional corporate governance changes detailed in Schedule 3 were
implemented in light, and as a result, of the Consolidated Securities
Action;

 

-3-

6. for the
calculation and payment of allowable claims;

 

7. for the
dismissal of the Consolidated Securities Action consistent with the terms set
forth below;

 

8. for the
release of claims against the Released Securities Parties, pursuant to the terms
set forth below;

 

9. for
certification, for purposes of the Securities Settlement alone, of the
Securities Plaintiff Class pursuant to Rule 23 of the Federal Rules of
Civil Procedure.

 

10. for the
requirements and procedures for notice to members of the Securities Plaintiff
Class and procedures and requirements for the submission of proofs of claim, the
calculation of allowable claims, the appropriate allocation among members of the
Class, the plan of distribution, the submission of members of the Securities
Plaintiff Class to the jurisdiction of the Federal Court for purposes of
resolving disputed claims, and summary resolution, or disputed
claims;

 

11. for such
other matters that are customarily included in stipulations governing the
settlement of securities class actions;

 

12. that the
Securities Plaintiffs expressly warrant that, in entering into the Settlement,
have relied solely upon their own knowledge and investigation, and not upon any
promise, representation, warranty, or other statement by the Securities
Defendants not expressly contained in this Memorandum or the Securities
Settlement Agreement ; and

 

13. that
Co-Lead Plaintiffs Counsel shall be allowed to review non-privileged documents,
deposition transcripts, and non-privileged reports, and to conduct witness
interviews to enable them to conduct further analysis of the evidence relevant
to the claims made in the Action.

 

14. that TXU
shall have the right to terminate the Securities Settlement in the event that
investors who would otherwise be members of the Securities Plaintiff Class, and
purchased TXU securities in aggregated amounts to be specified in a supplemental
agreement to be lodged with the Federal Court (the “Supplemental Agreement”),
request exclusion from the Class.

 

(ii) Released
Claims. The
Securities Settlement Agreement shall contain a full and general release to all
of the Securities Defendants and Released Securities Parties, including the
claims that were, or could have been, asserted in the July 21, 2003 complaint
captioned Schwartz, et
al. v. TXU Corp, et al., Civil
Action No. 3:02-CV-2243-K. The releases set forth in the Securities Settlement
Agreement shall cover all claims both known and unknown with the Securities
Plaintiffs waiving the benefits of §1542 of the California Civil Code (or any
law of any state or territory of the United States, or principle of common law,
that is similar, comparable, or equivalent to §1542 of the California Civil
Code) which provides: “A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his settlement
with the debtor.” The Securities Settlement Agreement shall also contain a full
and general release of Co-Lead Plaintiffs' Counsel by the TXU Defendants of any
claims they have relating to, or arising out of, the Consolidated Securities
Action. 

 

-4-

(iii) Securities
Settlement Fund. In full
and final settlement and release of all claims asserted, and all claims that
could have been asserted, against the Securities Defendants and/or the Released
Securities Parties in the Consolidated Securities Action, the Securities
Settlement Agreement shall provide that the following contribution will be made
to the Securities Settlement Fund. Within sixty (60) days of the execution of
the Memorandum, the Defendants shall deposit or cause to be deposited
$149,750,000 (the "Securities Settlement Fund") into a qualified settlement fund
created by order of the Federal Court consistent with Section 468B of the
Internal Revenue Code or into such other vehicle as TXU and the Securities
Plaintiffs may agree, with Lerach Coughlin Stoia Geller Rudman & Robbins LLP
acting as escrow agent or its equivalent (the "Account"). 

 

(iv) Costs. All
claims of the Securities Plaintiffs and the Securities Plaintiff Class against
the Securities Defendants in the Consolidated Securities Action, all fees to be
paid to counsel to the Securities Plaintiffs, and all other administrative or
other approved expenses of the Securities Settlement, including all notice
expenses and escrow costs, shall be paid from the Securities Settlement Fund. An
amount of cash, not to exceed $100,000, shall be made available out of the
Securities Settlement Fund to the Co-Lead Plaintiffs' Counsel for purposes of
defraying the actual cost of notice to the Securities Plaintiff
Class.

 

(v) Attorneys'
Fees. Counsel
for the Securities Plaintiffs and the Securities Plaintiff Class may apply to
the Federal Court for an award of attorneys' fees and reimbursement of all
expenses incurred on behalf of the Securities Plaintiffs and the Securities
Plaintiffs Class. All attorneys’ fees and expenses and interest due any counsel
for the Securities Plaintiffs shall be payable solely out of the Securities
Settlement Fund and shall be deducted from the Securities Settlement Fund prior
to the distribution to the members of the Securities Plaintiff Class following
entry of an order by the Federal Court approving any fees and expenses to the
Securities Plaintiffs' counsel. Lead Plaintiffs' Counsel may withdraw from the
escrow account and allocate amongst counsel for the Securities Plaintiffs the
fees and expenses so awarded; provided, however, that in the event that the
order approving the fee and expense award is reversed or modified on appeal, and
in the event that counsel for the Securities Plaintiffs (or any of them) has
received payment, such counsel shall, within five (5) business days of the date
which the fee and expense award is modified or reversed, refund to the Escrow
Account the fees and expenses previously received by them in full or in any
amount consistent with such reversal or modification, plus the interest earned
thereon through the date of such refund. 

 

(vi) Press
Releases. Before
issuing any press release about the Settlement, (a) the Securities Plaintiffs
and/or Co-Lead Plaintiffs' Counsel will provide the TXU Defendants with a
reasonable period of time to review and comment on any such release, and (b) the
TXU Defendants will provide Co-Lead Plaintiffs' Counsel with a reasonable period
of time to review and comment on any such release. 

 

-5-

(vii) Conditions
to Securities Settlement. This
Memorandum shall be null and void and of no force and effect and the Securities
Settlement Fund, together with any interest thereon, net of any actual costs
incurred for notice expenses, will be returned to the contributing parties in
pro
rata share if
any of the conditions set forth in this paragraph are not met and the Securities
Parties choose not to proceed with the Securities Settlement. The consummation
of the Securities Settlement contemplated herein is subject to:

 

1. the
drafting and execution of a Securities Settlement Agreement and the Supplemental
Agreement that is acceptable to the Settling Parties and of such pleadings and
notices as may be required to obtain the Federal Court's approval of the
Securities Settlement;

 

2. the
funding of the Securities Settlement Fund as provided above;

 

3. the
implementation of the corporate governance changes as provided for in Schedules
2 and 3 attached hereto;

 

4. preliminary
approval by the Federal Court of the Securities Settlement;

 

5. certification
of the Securities Plaintiff Class for settlement purposes only by the Federal
Court;

 

6. TXU’s
determination not to exercise its termination rights, if any, under the
Supplemental Agreement with respect to requests for exclusion from the
Securities Plaintiff Class;

 

7. final
approval by the Federal Court of the Securities Settlement, except with respect
to attorneys' fees requested by counsel to the Securities Plaintiffs Class or as
to the plan of allocation; and

 

8. final
judgment, which means a judgment entered by the Federal Court approving the
Securities Settlement and dismissing all claims that have been, or could have
been, brought in the Consolidated Securities Action as against the Securities
Defendants with prejudice and without costs to any party, that has become final
and no longer subject to further appeal or review, whether by exhaustion of any
possible appeal, lapse of time, or otherwise.

 

CONDITIONS
TO SETTLEMENT

The
Settling Parties acknowledge that the failure to complete the Settlement under
the terms of this Memorandum will result in irreparable harm that cannot be
adequately compensated through money damages and that each therefore agrees that
specific performance is the appropriate remedy for breach of this Memorandum,
provided, however, that only the Securities Plaintiffs and TXU may seek relief
under this section.

 

-6-

GENERAL
TERMS

(i) Further
Documentation. The
Settling Parties acknowledge that this Memorandum does not set forth all of the
substantive terms necessary and appropriate for a complete and final Settlement
of the Consolidated Securities Action, and undertake to work in good faith to
memorialize such terms, which shall be embodied in the Securities Settlement
Agreement.

 

(ii) Amendments. This
Memorandum and all documents executed pursuant hereto and thereto, shall
constitute a legally binding and enforceable obligation on the part of each of
the parties hereto and their successors-in-interest, subject only to their terms
and conditions set forth herein and therein. This Memorandum may be amended only
by a written instrument signed by each of the respective parties hereto, or
their counsel acting on their behalf.

 

(iii) Entire
Agreement. This
Memorandum and all documents executed pursuant hereto and thereto, constitutes
the entire agreement between the parties with respect to the matters discussed
herein and supersedes any and all prior negotiations, discussions, agreements or
undertakings, whether oral or written, with respect to such matters. This
Memorandum shall be deemed drafted equally by all parties hereto.

 

(iv) Counterparts. This
Memorandum may be executed in counterparts by any of the signatories hereto, and
as so executed shall constitute one agreement.

 

 

3232
McKinney Avenue, Suite 700

Dallas,
TX 75204

Telephone:
214/744-3000

214/744-3015
(fax)

 

DATED: January __, 2005 

            

                                                          LERACH COUGHLIN STOIA
GELLER

                       RUDMAN & ROBBINS
LLP

                       DARREN J.
ROBBINS

                       MARK SOLOMON

                         
 ELLEN GUSIKOFF STEWART

 

___________________________________

DARREN J.
ROBBINS

401 B Street, Suite 1600

San Diego, CA 92101

Telephone: 619/231-1058

619/231-7423 (fax)

 

 

Attorneys in Charge and

Co-Lead Counsel for
Plaintiffs

 

 

-7-

DATED:
January __, 2005                 ORRICK,
HERRINGTON &

SUTCLIFFE
LLP

ROBERT P.
VARIAN

____________________________________

ROBERT P.
VARIAN

 

405
Howard Street

San
Francisco, CA 94105-2669

Telephone:
415/773-5934

415/773-5759
(fax)

Attorneys
for TXU Defendants

DATED:
January __, 2005           ____________________________________

DAVID P.
POOLE 

TXU
Legal

1601
Bryan Street, Suite 2100

Dallas,
Texas 75201-3402

214.812.6001

214.812.6032
(fax)

Attorney
for TXU Defendants

 

-8-

SCHEDULE
1

 

1.The cash
portion of the settlement will be paid into an escrow fund located in California
and controlled by Lerach Coughlin Stoia Geller Rudman & Robbins (“LCSGRR”)
(subject to court oversight) within 60 days from agreement in principle
evidenced by a signed MOU. However, the monies shall bear interest at 12-1/2%
beginning 60 days after execution of an MOU until actually deposited in the
escrow account.

 

2.The
settlement will be non-recapture, i.e., it is
not a claims-made settlement. The defendants have no ability to get back any of
the settlement monies. The settlement claims process will be administered by an
independent claims administrator approved by the court. The defendants will have
no involvement in reviewing or challenging claims.

 

3.Any
attorneys’ fees and costs awarded plaintiffs’ counsel by the court shall be paid
to plaintiffs’ counsel immediately upon award, notwithstanding the existence of
any timely filed objections thereto, or potential for appeal therefrom, or
collateral attack on the settlement or any part thereof, subject to plaintiffs’
counsel’s several obligation to make appropriate refunds or repayments to the
settlement fund plus interest earned thereon if, and when, as a result of any
appeal and/or further proceedings on remand, or successful collateral attack,
the fee or cost award is lowered.

 

4.The
settlement will contain a release providing “Defendants and their related
parties shall be released from any and all claims arising from both the purchase
of TXU securities during the Class Period and the acts, facts, statements, or
omissions that were or could have been alleged by the plaintiff(s) in the
action.” The releases between the parties will include releases of all counsel
in the action. The settlement will not be conditioned upon the obtaining of or
any judicial approval of any releases between or among the settling defendants
and/or any third parties. No such releases will be contained in the Stipulation
or referred to in the Final Judgment approving the settlement.

 

5.If so
ordered by the court upon preliminary approval, plaintiffs’ counsel shall be
entitled to provisional reimbursement of 75% of their out-of-pocket costs,
subject to plaintiffs’ counsel’s several obligation to make appropriate refunds
or repayments to the settlement fund plus interest earned thereon if, and when,
as a result of any order, the final fee or cost award is lower than that
amount.

 

6.The class
notice will provide for a 30-day opt-out period.

SCHEDULE
2

 

 

CORPORATE
GOVERNANCE REFORMS TO BE IMPLEMENTED BY TXU

 

Set forth
below are the future corporate governance reforms and enhancements that TXU has
agreed to implement and maintain for at least seven (7) years as part of the
overall resolution of the Action:

 

1. Stock
Ownership.
In light
of the litigation, TXU had planned to adopt stock ownership guidelines requiring
directors to hold, at a minimum, $40,000 worth of TXU common stock, with a five
year compliance period. TXU will increase the minimum stock holding to $75,000
and will reduce the compliance period to two years from the date of appointment
to the board.

 

2.Increased
Number of Independent Directors.
The
defendants will use their best efforts to ensure that at least 70% of the
board
qualifies as independent pursuant to the standards set forth in this agreement
on or before December 31, 2005 and in any event 70% of the members of the board
shall meet such independence requirements on or before May 31,
2006.

 

3.
New
Independent Directors.
At least
two members of the board of directors who were on the TXU Board of Directors
during the Class Period and remain on the TXU board shall be replaced no later
than May 31, 2006 by two new independent board members who have no prior
relationship with TXU and via a process conducted by the nominating committee in
cooperation with lead plaintiffs.

 

4.Lead
Independent Director.
The
duties of TXU’s “Lead Independent Director” (established and provided specific
oversight duties by TXU in light of the litigation) shall include the
requirement that he/she affirmatively assist in governance compliance and have
the explicit authority to retain independent counsel or
consultants.

 

5.Enhanced
Independent Standards.
By no
later than May 31, 2006, TXU shall implement heightened independence standards
detailed below:

 

(a)
 To be
deemed "independent," a director must satisfy the following
qualifications:

 

(i) Has not
been employed by the Company or its subsidiaries or affiliates in an executive
capacity within the last five calendar years;

 

(ii) has not
received, during the current calendar year or any of the three immediately
preceding calendar years, remuneration, directly or indirectly, other than de
minimis remuneration, as a result of service as, or being affiliated with an
entity that serves as, (i) an advisor, consultant, or legal counsel to the
Company or to a member of the Company's senior management; or (ii) a significant
customer or supplier of the Company;

 

(iii) has no
personal services contract(s) with the Company, or any member of the Company's
senior management;

 

(iv) is not a
director, an officer or trustee of a not-for-profit entity that has received
contributions from the Company in an amount which, in any of the last three
fiscal years of such entity, exceeds the lesser of $200,000 or 5% of such
non-profit's gift revenues;

 

(v) is not
employed by a public company at which an executive officer of the Company also
serves as a director;

 

(vi) has not
had any of the relationships described in (i) — (v) above with any affiliate or
subsidiary of the Company; and

 

(vii) is not a
member of the immediate family of any person described in (i) — (v)
above.

 

(viii) a
director is deemed to have received remuneration, directly or indirectly, if
remuneration, other than de minimis remuneration, was paid by the Company, its
subsidiaries, or affiliates, to any entity in which the director has a
beneficial ownership interest of five percent or more, or to an entity by which
the director is employed or self-employed other than as a director. Remuneration
is deemed de minimis remuneration if such remuneration, is $40,000 or less in
any calendar year. 

 

(b) The Board
would adopt stock ownership guidelines that required directors to hold, at a
minimum, $75,000 worth of TXU common stock, with a two-year compliance
period.

 

6.Poison
Pill.
Subject
to Board approval after appropriate analysis and advice necessary to comply with
its fiduciary duties, TXU will rescind its “shareholder rights plan” adopted on
2/19/99 and no such device or provision shall be adopted in future unless
approved first by the holders of a majority of the outstanding shares of TXU
common stock excluding votes of officers, directors, their controlling persons
or affiliates.

 

7.Stock
Option Plans.
No stock
option plan shall be implemented without prior approval by holders of a majority
of the outstanding shares of TXU. Similarly, no stock option plan may be
modified with or provide for reload, repricing or replacement options to reduce
option exercise prices or increase the number of shares granted without prior
approval by a majority of the holders, the outstanding shares of
TXU.

 

8.Corporate
Ethics Officer.
TXU has
appointed an officer for corporate ethics, honesty and legal compliance who, in
the absence of a complainant’s bad-faith subject to the requirements of
applicable laws and regulations, will keep confidential the identities of
employees who report instances of illegal conduct.

 

9.Executive
and Director Compensation.
TXU’s
Compensation Committee shall review annually director compensation. TXU will not
enter into any future employment agreements or benefit agreements that include a
“change of control” definition that does not require an actual sale or merger to
occur, and the Committee shall annually review the use of corporate
aircraft.

 

10.Financial
Reporting.
TXU’s CFO
shall not have been employed by TXU’s outside auditor firm during the prior five
years, and at every scheduled board meeting after quarter ends management will
provide a report as to the company’s financial condition and prospects which
will be noted in the minutes.

 

11. Best
Value Contracting Policy. TXU
shall use its best efforts to implement and utilize the contracting policies
detailed in Exhibit 1 attached hereto in connection with the awarding of
construction, maintenance and similar contracts with a value of $750,000 or more
involving TXU, its affiliates and/or its subsidiaries whether such contract is
awarded directly by TXU or through its agents, including Cap Gemini Energy
LP.

 

12.Audit
Committee.
The
charter of TXU’s Audit Committee shall require it to meet with the General
Counsel periodically to review related-party transactions and insider trading
requirements, the CFO’s performance and lack of conflicts shall be part of the
CFO’s annual review and TXU’s auditing firm shall not perform any consulting
work for TXU not approved by Audit Committee or provide tax or financial
planning advice to any officer.

 

13.Prohibited
Transactions.
No
director or member of the company’s leadership team shall short TXU stock or
engage in derivative transactions relating to TXU securities. “Cluster” sales
shall be reported upon to the Chairman and lead independent
director.

 

14.Shareholder
Proposals.
All of
TXU’s shareholder proposals shall be evaluated by the Nominating and Governance
Committee. The Committee shall recommend to the board whether or not to support
such proposal and the reasons for such recommendation. The Committee shall
consist only of independent directors.

 

15. Board
and Management Integrity.
Directors
shall participate in mandatory executive sessions of TXU’s non-management
directors. Topics addressed shall include the quality of TXU's financial
reporting and disclosure practices, the integrity and performance of TXU's top
executives, and the company's relationship with its outside auditor. TXU shall
amend the charter of the Nominating and Governance Committee to include "strong
character" and "business acumen" as desired attributes for
directors.

EXHIBIT
1

 

BEST
VALUE CONTRACTING POLICY TO BE IMPLEMENTED BY TXU

 

Best
Value Contracting Policy

This Best
Value Contracting Policy as adopted will apply only to construction, maintenance
and similar contracts (other than contracts awarded under emergency
circumstances where normal bid processes must be suspended in order to respond
to exigent circumstances involving transmission and distribution systems, mining
equipment, generating plants, and related facilities owned and operated by TXU
Corp.’s subsidiaries and affiliates) with a value of $750,000 or more involving
TXU, its affiliates and/or its subsidiaries whether such contract is awarded
directly by TXU or through its agents. TXU Corp. will use its best efforts to
implement the following contracting policies through its outsourced business
services provided by Cap Gemini Energy LP:

A. Definition
of Qualified Provider

A
provider will only be selected for award of a contract after establishing
compliance with the following criteria:

1. Each
provider must have demonstrated to have the required skills, experience and
qualified personnel for a given project. In particular, each provider shall
contribute to and participate in craft training and have demonstrated skills of
the supervisory staff, compliance with laws and regulations, and past
performance on projects. This will be determined through direct knowledge TXU
personnel have of the provider or through interviewing the provider and its
personnel and obtaining recommendations from recent customers.

2. Each
provider must demonstrate the financial strength to complete the specific
project and provide benefits to workers at a level that demonstrates a
commitment to a positive economic impact on the community where the work is
being performed.

3. Each
provider must have a written safety policy acceptable to TXU and a demonstrated
commitment to safety. Each contactor must provide validated safety records
concerning their safety record on recent projects.

4. Each
provider must have a drug-free work environment with an acceptable drug policy
to include testing and monitoring of personnel and otherwise meets TXU’s
requirements.

5. Each
provider must be in compliance with employment laws including, but not limited
to, racial discrimination and immigration laws.

6. Each
provider must meet TXU’s insurance requirements.

7. Each
provider must be able to post a performance bond applicable to the
project.

8. Providers
must have a required business license to operate in the states involved in the
particular project.

9. Each
provider must provide information concerning any litigation involving them in
the last three years relating to or arising from employment, labor or safety
issues, as well as breach of contract and/or fraud.

10. Each
provider shall provide employment benefits so as they have a positive economic
impact on the communities in which the work is being performed.

Once
selected, a provider shall annually certify its compliance with this
paragraph.

B. General
Rules and Procedures

1. Open
Competition. Solicitations for projects shall be conducted in the context of
free and open competition and follow the same advertising requirements used for
sealed bidding.

2. RFP
Process: Potential providers shall compete for projects by submitting sealed
proposals in response to Request for Proposals (“RFPs”).

3. Best
Value Award Method: TXU shall administer its Best Value RFP process in
accordance with the standards and procedures of this Policy.

4. Required
Technical Evaluation Factors: RFPs issued pursuant to this policy shall include
the following evaluation factors: (a) Past Performance; (b) Management
Plan/Schedule; (c) Staffing/Training/Safety Plan; (d) Wages & Fringe Benefit
Plan; and (e) Local Economic Benefit Plan.

5. Subcontractor
Listing: providers such as general contractors, construction managers or other
prime contractors shall list proposed subcontractors (over $100,000) in their
proposals and the awarding of contracts shall be based, in part, on the
qualifications and capabilities of the listed subcontractors.

C. RFP
Standards and Criteria

1. Required
RFP Evaluation Factors: RFPs issued under this policy shall include the
technical evaluation factors and definitions specified below.

2. Required
Evaluation Factors & Definitions

(a) Past
Performance: Performance information and data on the provider’s past projects
for the three most recent years, especially projects similar in size and scope.
TXU shall examine all available performance evaluation reports from the outside
provider and pre-listed subcontractors and should also utilize any other
relevant sources of past performance data. Past Performance shall include the
degree to which the provider:

(i) completed
projects safely (including an examination of accident/injury data, lost-time
data and safety violations);

(ii) complied
with applicable laws and regulations (including those relating to permitting,
licensing, wages and environmental);

(iii) completed
projects in a timely and cost-effective manner; and

(iv) complied
with project plans and specifications.

(b) Management
Plan/Schedule: Provider’s plan for managing the project must demonstrate its
technical qualifications and competency to perform the work. The Management
Plan/Schedule shall include:

(i) management
team/key personnel proposed for project;

(ii) technical
approach to the project and quality control program; and

(iii) project
schedule and degree to which the provider can realistically perform the schedule
as proposed.

(c) Staffing/Training/Safety
Plans. Provider’s plan must demonstrate its capability to recruit, deploy and
retain sufficient numbers of qualified construction craft personnel for the
project. The Project Staffing/Training/Safety Plan shall include:

(i) Staffing:
significant weight will be given to firms that utilize reliable staffing
sources, such as local union hiring halls or referral systems;

(ii) Training:
consideration should be given reliability of the training providers, the
facilities and resources used and the degree to which the firm participates in a
bona fide registered apprenticeship training program (a bona fide registered
apprenticeship training program is one registered with the U.S. Department of
Labor or a State Apprenticeship Council).

(iii) Safety:
pro-active safety measures by the provider, including formal safety training
programs, such as the OSHA Construction Safety and Health courses, written
health and safety plans, accident-prevention programs and substance abuse
programs, should be given consideration.

(d) Local
Economic Benefits Plan: Provider’s plan shall demonstrate how it will provide
economic benefits to the local community. The Local Economic Benefits Plan shall
include:

(i) the
number of jobs generated for local residents;

(ii) the level
of wages paid and types of fringe benefits provided, including employer provided
health insurance;

(iii) the
offeror’s use of local joint venture partners and subcontractors;
and

(iv) the
amount of tax revenue generated for the local economy.

3. Debriefing
Rights: Providers shall be entitled to debriefings in which they can obtain
their technical performance as well as the price performance and technical
performance of the successful provider.

4. Contract
Award: Each provider shall have its offer considered both as to its respective
price proposals and technical proposals and the provider proffering the superior
overall offer, taking into account all of these factors, shall be awarded the
project.

5. BVC
Policy Review: Lead plaintiffs’ representative shall have the right to conduct
an annual audit of TXU’s compliance with the BVC Policy for three years after
the court approval of the settlement of which this is a part by, among other
things, meeting with TXU representatives responsible for compliance with the BVC
Policy. Lead plaintiffs’ representative shall provide TXU with at least thirty
(30) days written notice of intent to engage in such audit. TXU and its
representatives shall take all reasonable steps to facilitate such audit. To the
extent a dispute arises relating to the BVC Policy and/or compliance hereunder,
such issue shall be submitted to mediator Robert Parker for resolution within
thirty (30) days of the date TXU is notified of such issue. In the event Robert
Parker is incapable of serving in this role, the parties shall select a mutually
agreeable replacement mediator.

SCHEDULE
3

 

GOVERNANCE
REFORMS ADOPTED BY TXU

IN
RESPONSE TO THE CONSOLIDATED SECURITIES ACTION

 

Defendants
acknowledge that the pendency and prosecution of the Action, including the
demands made in connection therewith, were a material and substantial factor
underlying the decision of the Board of Directors of TXU (the “TXU Board”) to
substantially alter and improve the manner in which the Company is governed.
Subsequent to the filing of the Action, the Board adopted various corporate
governance changes detailed in internal TXU’S charter and guidelines in order to
improve TXU’s corporate governance, including:

 

1. Enhanced
Board Independence. TXU
implemented policies to ensure heightened director independence whereby to be
considered “independent,” a director may not have been employed as an executive
at TXU (or TXU’s subsidiaries or affiliates) in the last three years, has no
personal service contracts with the company or senior management, is not
employed by a public company at which an executive officer of TXU is a director,
and is not an officer, director or trustee of a not-for-profit entity that in
any of the last three years received contributions from the Company the greater
of $1,000,000 or 2%.

 

2. Stock
Ownership. TXU had
planned to require directors to hold, at a minimum, $40,000 worth of TXU common
stock.

 

3. Appointment
of a Chief Governance Officer and Director of Corporate
Governance. TXU has
appointed a Chief Governance Officer and Director of Corporate Governance, whose
duties include oversight of the Company’s corporate governance policies,
procedures and practices. In addition, the Chief Governance Officer also serves
as the Chief Compliance Officer, responsible for oversight of compliance with
TXU’s Code of Conduct.

 

4. Insider
Trading Controls. Insider
trading controls have been implemented that provide trading bars and
pre-clearance conditions, requiring pre-clearance from a pre-clearance group
that includes the general counsel, the corporate secretary and the
CFO.

 

5. Lead
Independent Director. Created
the position of a “Lead Independent Director” with specific, articulated duties
designed to enhance the oversight of TXU’s management and Board by TXU’s
independent directors.

 

6. Governance,
Compensation and Audit Committees Composed of Independent
Directors. TXU has
agreed that each of the three Committees shall be composed of independent
directors.

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