File No. 070-9895
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-1/A
POST-EFFECTIVE AMENDMENT NO. 5 TO
APPLICATION/DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
CenterPoint Energy, Inc.
1111 Louisiana
Houston, Texas 77002
Utility Holding, LLC
200 West Ninth Street Plaza
Suite 411
Wilmington, Delaware 19801
(Name of companies filing this statement and
address of principal executive offices)
CenterPoint Energy, Inc.
1111 Louisiana
Houston, Texas 77002
(Name of top registered holding company parent of each applicant or declarant)
Rufus S. Scott
Vice President, Deputy General Counsel and Assistant Corporate Secretary
CenterPoint Energy, Inc.
1111 Louisiana
Houston, Texas 77002
(713) 207-7451
(Names and addresses of agents for service)
The Commission is also requested to send copies
of any communications in connection with this matter to:
James R. Doty, Esq. Margo S. Scholin, Esq.
Joanne C. Rutkowski, Esq. Baker Botts L.L.P.
Baker Botts L.L.P. 3000 One Shell Plaza
The Warner Houston, Texas 77002-4995
1299 Pennsylvania Avenue, N.W. (713) 229-1234
Washington, D.C. 20004-2400
(202) 639-7700
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
From time to time, CenterPoint Energy, Inc. and its subsidiaries make
statements concerning our expectations, beliefs, plans, objectives, goals,
strategies, future events or performance and underlying assumptions and other
statements that are not historical facts. These statements are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995, within the meaning of Rule 103A under the Public Utility Holding
Company Act of 1935 or other provisions of the securities laws. Actual results
may differ materially from those expressed or implied by these statements. The
reader can generally identify our forward-looking statements by the words
"anticipate," "believe," "continue," "could," "estimate," "expect," "intend,"
"may," "plan," "potential," "predict," "should," "will," "forecast," "goal,"
"objective," "projection," or other similar words.
We have based our forward-looking statements on our management's
beliefs and assumptions based on information available to our management at the
time the statements are made. We caution the reader that assumptions, beliefs,
expectations, intentions and projections about future events may and often do
vary materially from actual results. Therefore, we cannot assure the reader that
actual results will not differ materially from those expressed or implied by our
forward-looking statements.
For some of the factors that could cause actual results to differ
materially from those expressed or implied by our forward-looking statements,
see CenterPoint Energy, Inc.'s Annual Report on Form 10-K for the period ending
December 31, 2002 (File No. 1-31447), including those outlined in "Business --
Risk Factors" and "Management's Discussion and Analysis of Financial Condition
and Results of Operations -- Certain Factors Affecting Our Future Earnings", the
Current Report of CenterPoint Energy, Inc. on Form 8-K dated as of May 12, 2003
and in this Form U-1/A.
The reader should not place undue reliance on forward-looking
statements. Each forward-looking statement speaks only as of the date of the
particular statement, and we undertake no obligation to publicly update or
revise any forward-looking statements.
CenterPoint Energy, Inc. ("CenterPoint" or the "Company") and Utility
Holding, LLC hereby provides additional information in this
Application-Declaration to update the Securities and Exchange Commission (the
"Commission") on recent developments in File No. 070-9895.
This Post-Effective Amendment No. 5 to the Application-Declaration is
intended to supplement and amend, as appropriate, Post-Effective Amendment No. 4
to the Application-Declaration (the "Post-Effective Amendment No. 4").
As discussed in the Post-Effective Amendment No. 4, pursuant to
authority granted by the Commission in its order dated July 5, 2002 (HCAR No.
27548), CenterPoint entered into a $3.85 billion, 364-day credit facility (the
"CenterPoint Facility") to replace a similar facility that had expired. On
February 28, 2003, CenterPoint reached agreement with a syndicate of banks on a
second amendment to the CenterPoint Facility (the "Second Amendment"), which
provided significant improvements for CenterPoint and enhanced its access to the
capital markets.(1)
As additional compensation to the banks for the extended maturity and
the elimination of the mandatory prepayments that had existed under the
CenterPoint Facility, CenterPoint committed under the Second Amendment to grant
the banks, on or before May 28, 2003, warrants to purchase 10 percent, on a
fully diluted basis, of the Company's common stock. The exercise price for the
warrants would be equal to the greater of (i) $6.56 or (ii) 110 percent of the
closing price on the New York Stock Exchange on the date the warrants are
issued. The warrants would be issued upon receipt of Commission approval and
would remain outstanding for four years. They would not, however, be exercisable
for a year after issuance.
CenterPoint has the opportunity to reduce or extinguish the warrants to
the extent it reduces the bank facility during 2003 by specified amounts. The
Second Amendment contemplates that the Company could extinguish up to $400
million of warrants by reducing the bank facility by a like amount on or before
May 28, 2003. The remaining 50% of the warrants could be extinguished, on a
proportionate basis, to the extent the Company reduces the bank facility by up
to an additional $400 million by the end of 2003.
To date, CenterPoint has reduced the bank facility by $607 million,
thereby extinguishing approximately 75% of the warrants, and anticipates that it
will obtain sufficient funds from recently announced financings to eliminate the
vesting of the remainder of the warrants.
- ----------
(1) At current credit ratings, pricing for loans under the Second Amendment
remains the same as under the original CenterPoint Facility. CenterPoint has
agreed to pay the banks an extension fee of 75 basis points on the amounts
outstanding under the bank facility on October 9, 2003, the maturity date of the
original CenterPoint Facility. CenterPoint also paid $41 million in fees that
were due on February 28, 2003 and agreed to accelerate payment of $20 million in
fees that were otherwise due on June 30, 2003, under the terms of the existing
facility.
Page 1
EXHIBITS
Exhibit G-26 Description of existing system debt and a discussion of
priorities with respect to same (revised).
Exhibit G-27 Financing Opinion (filed in connection herewith with a
request for confidential treatment).
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, as amended, the Applicants have duly caused this
Application/Declaration to be signed on their behalf by the undersigned
thereunto duly authorized.
Date: May 22, 2003
CENTERPOINT ENERGY, INC.
and its subsidiary companies as named on the title page
By: /s/ Rufus S. Scott
--------------------------------------------
Rufus S. Scott
Vice President, Deputy General Counsel and Assistant Corporate Secretary
CenterPoint Energy, Inc.
Page 2
EXHIBIT G-26
PRIORITY OF PAYMENT OBLIGATIONS IN A LIQUIDATION SCENARIO PRE-FINANCING
PRIORITY OF CENTERPOINT (CORPORATE) PAYMENT OBLIGATIONS
1. Secured debt, including collateralized pollution control bonds, to the
extent of the collateral.
2. Senior unsecured debt, including bank loans, uncollateralized
pollution control bonds, convertible notes, trade payables and other
unsecured liabilities.
3. ZENS (junior right of payment to all senior indebtedness).
4. Debentures issued to trusts issuing trust preferred securities
(subordinate and junior in right of payment to all senior indebtedness
and pari passu with obligations to or rights of CenterPoint's other
general unsecured creditors).
5. Common stock.
PRIORITY OF T&D UTILITY PAYMENT OBLIGATIONS
1. First mortgage bonds to the extent of the collateral.
2. General mortgage bonds and term loan collateralized by general
mortgage bonds to the extent of the collateral.
3. LLC membership interests.
PRIORITY OF GASCO PAYMENT OBLIGATIONS
1. Senior unsecured debt, including bank lines of credit, trade payables
and other unsecured liabilities.
2. Convertible subordinated debentures (subordinate to all senior
indebtedness including leases).
3. Debentures issued to trust issuing convertible trust preferred
securities (subordinate and junior in right of payment to all senior
indebtedness and pari passu with obligations to or rights of GasCo's
other general unsecured creditors).
4. Common stock.
PRIORITY OF PAYMENT OBLIGATIONS IN A LIQUIDATION SCENARIO POST-FINANCING
PRIORITY OF CENTERPOINT (CORPORATE) PAYMENT OBLIGATIONS
1. Senior secured debt, including bank loans and collateralized pollution
control bonds, to the extent of the collateral.
2. Senior unsecured debt, including bank loans in excess of the
collateral, uncollateralized pollution control bonds, convertible
notes, trade payables and other unsecured liabilities.
3. ZENS (junior right of payment to all senior indebtedness).
4. Debentures issued to trusts issuing trust preferred securities
(subordinate and junior in right of payment to all senior indebtedness
and pari passu with obligations to or rights of CenterPoint's other
general unsecured creditors).
5. Common stock.
PRIORITY OF T&D UTILITY PAYMENT OBLIGATIONS
1. First mortgage bonds to the extent of the collateral.
2. General mortgage bonds and term loan collateralized by general
mortgage bonds to the extent of the collateral.
3. LLC membership interests.
PRIORITY OF GASCO PAYMENT OBLIGATIONS
1. Senior unsecured debt, including bank lines of credit, trade payables
and other unsecured liabilities
2. Convertible subordinated debentures (subordinate to all senior
indebtedness including leases)
3. Debentures issued to trust issuing convertible trust preferred
securities (subordinate and junior in right of payment to all senior
indebtedness and pari passu with obligations to or rights of GasCo's
other general unsecured creditors)
4. Common stock
OBLIGATION AMOUNT MATURITY PRIORITY* SECURITY
- ---------------------------- ------------- --------- -------------------- -------------------------------------------
CENTERPOINT ENERGY, INC.**
$3.243 billion bank facility $3.243 billion June 2005 SENIOR TO THE SECURED TO THE EXTENT OF THE VALUE OF
UNSECURED DEBT OF TEXAS GENCO STOCK.***
PARENT TO THE EXTENT
OF THE
COLLATERAL.**** DEBT
IN EXCESS OF THE
VALUE OF THE
COLLATERAL IS SENIOR
UNSECURED DEBT OF
PARENT.
ZENS $840 million September Junior in right of Unsecured.
15, 2029 payment to all
senior indebtedness.
Collateralized Pollution $924 million Various Senior secured debt Debt at the parent level is collateralized
Control Bonds of Parent. by First Mortgage Bonds or General Mortgage
Bonds of the T&D Utility, which are
obligations of T&D Utility and secured
by the property of the T&D Utility. Debt
collateralized by First Mortgage Bonds
was incurred by the T&D Utility prior to
the formation of CenterPoint, but became
an obligation of the holding company
under the terms of the underlying
installment payment agreements.
General Mortgage Bonds were first issued
by the T&D Utility in October 2002 in
connection with the refinancing of bank
debt. Under "equal and ratable" security
clauses, the T&D Utility was required to
issue General Mortgage Bonds to secure
some series of Pollution Control Bonds
that originally were unsecured.
Convertible Senior Notes $575 million May 15, 2023 Senior unsecured Unsecured.
debt of Parent.
OBLIGATION AMOUNT MATURITY PRIORITY* SECURITY
- ---------------------------- ------------- --------- -------------------- -------------------------------------------
Uncollateralized Pollution $519 million Various Senior unsecured Unsecured. Debt was incurred by the T&D
Control Bonds debt of Parent. Utility prior to the formation of
CenterPoint, but became an obligation of
the holding company under the terms of the
underlying installment payment agreements.
Trust Preferred Securities**** $725 million Various The obligations of Unsecured. Trust Preferred Securities
the Parent on the issued by subsidiary trusts prior to the
debentures issued to formation of CenterPoint, but trusts
the trust are became indirect subsidiaries of
subordinated and CenterPoint at the time of the
junior in right of restructuring. In each case, the parent
payment to all company issued subordinated debentures
senior indebtedness to the trusts, the debt service on which
of the Parent, and is the only source of funds available to
pari passu with the trusts to pay distributions on the
obligations to other trust preferred securities. Those
general unsecured subordinated debentures are now the
creditors. The obligations of CenterPoint.
Parent has the right
in certain
circumstances to
defer payment of
interest on the
debentures from time
to time.
T&D UTILITY
First Mortgage Bonds $302 million Various Senior. Secured by a lien on most assets of the
T&D Utility. Issued by utility beginning
in 1944 to secure indebtedness of an
integrated electric utility. First
Mortgage Bonds have not been issued
since 1995.
Collateralized Term Loan $1.310 billion November Senior. Secured by a lien on most assets of the
11, 2005 T&D Utility that is junior to the lien of
the First Mortgage Bonds. The General
Mortgage Bonds were issued by T&D
Utility November 12, 2002 in connection
with a term loan.
OBLIGATION AMOUNT MATURITY PRIORITY* SECURITY
- ---------------------------- ------------- --------- -------------------- -------------------------------------------
General Mortgage Bonds $762 million Various Senior. Secured by a lien on most assets of the
T&D Utility that is junior to the lien
of the First Mortgage Bonds. The General
Mortgage Bonds were issued by the T&D
Utility on March 18, 2003.
* Priority against primary obligor.
** All obligations of Parent are structurally subordinated to obligations of the subsidiaries.
*** Security will be released when Genco assets divested.
**** The Parent has provided a guarantee of certain payments, but only to the extent that the trust has funds available for
such payments.
TRANSITION BOND COMPANY
Transition Bonds $729 million Various Senior Issued by subsidiary of T&D Utility in
2001 pursuant to Texas Electric
Restructuring Law. Bonds are
non-recourse to the T&D Utility. Secured
by Transition Charge approved by the
Texas Utility Commission.
GasCo
Synthetic Put Bonds (TERMS) $140 million November Same as other Unsecured.
1, 2003 senior unsecured
(must be debt of GasCo.
remarketed
or
refinanced) Same as other Unsecured.
senior unsecured
Debentures/Notes $2.222 billion Various debt of GasCo.
Bank Facility $200 million March 23, Same as other Unsecured.
2004 senior unsecured
debt of GasCo.
OBLIGATION AMOUNT MATURITY PRIORITY* SECURITY
- ---------------------------- ------------- --------- -------------------- -------------------------------------------
Convertible Subordinated $79 million March 15, Subordinated to Unsecured.
Debentures 2012 senior unsecured
debt of GasCo.
Trust Preferred Securities**** $0.4 million 2026 The obligations of Unsecured. The trust preferred
the Parent on the securities were issued by a financing
**** GasCo has provided a subordinated subsidiary of NorAm Energy Corp. before
guarantee, on a subordinated debentures issued to its acquisition by CenterPoint's
basis, of certain payments, the trust are predecessor. NorAm issued convertible
but only to the extent that subordinate and junior subordinated debentures to the
the trust has funds available junior in right of trust, the interest payments on which
for such payments. payment to all are utilized to pay the distributions on
senior indebtedness the trust preferred securities. The
and pari passu with trust preferred securities are
obligations to or convertible into CenterPoint common
rights of GasCo's stock.
other unsecured
creditors. The
Parent has the right
in certain
circumstances to
defer payment of
interest on the
debentures from time
to time.
CenterPoint Energy Gas
Receivables, LLC
Receivables Facility $150 million November Senior Ownership of the receivables.
14, 2003
