CenterPoint Energy 2009 Annual Report Download - page 76

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54
CERC could have to honor its guarantee and, in such event, collateral provided as security may be insufficient to
satisfy CERC’s obligations.
Debt Financing Transactions. In January 2009, CenterPoint Houston issued $500 million aggregate principal
amount of general mortgage bonds due in March 2014 with an interest rate of 7.00%. The proceeds from the sale of
the bonds were used for general corporate purposes, including the repayment of outstanding borrowings under
CenterPoint Houston’s revolving credit facility and the money pool, capital expenditures and storm restoration costs
associated with Hurricane Ike.
In August 2009, SESH closed on a private debt offering in the amount of $375 million. Also during 2009, CERC
Corp. made a capital contribution to SESH in the amount of $137 million. Using $186 million of its proceeds from
the debt offering and the capital contribution, SESH repaid the note receivable it owed to CERC Corp., which note
had a principal balance of $323 million at the time of the repayment. CERC Corp. used the proceeds to repay
borrowings under its credit facility.
In January 2010, we purchased $290 million principal amount of pollution control bonds issued on our behalf at
101% of their principal amount plus accrued interest pursuant to the mandatory tender provisions of the bonds. Prior
to the purchase, the pollution control bonds had a fixed rate of interest of 5.125%. The purchase reduces temporary
investments and leverage while providing us with the flexibility to finance future capital needs in the tax-exempt
market through a remarketing of these bonds.
In January 2010, CERC Corp. redeemed $45 million of its outstanding 6% convertible subordinated debentures
due 2012 at 100% of the principal amount plus accrued and unpaid interest to the redemption date.
System Restoration Bonds. In November 2009, CenterPoint Houston issued approximately $665 million of system
restoration bonds through its CenterPoint Energy Restoration Bond Company, LLC subsidiary with interest rates of
1.833% to 4.243% and final maturity dates ranging from February 2016 to August 2023. The bonds will be repaid
over time through a charge imposed on customers.
Equity Financing Transactions. During the year ended December 31, 2009, we received net proceeds of
approximately $280 million from the issuance of 24.2 million common shares in an underwritten public offering, net
proceeds of $148 million from the issuance of 14.3 million common shares through a continuous offering program,
proceeds of approximately $57 million from the sale of approximately 4.9 million common shares to our defined
contribution plan and proceeds of approximately $15 million from the sale of approximately 1.3 million common
shares to participants in our enhanced dividend reinvestment plan.
Credit and Receivables Facilities. In October 2009, CenterPoint Houston terminated its $600 million 364-day
secured credit facility which had been arranged in November 2008 following Hurricane Ike.
In October 2009, the size of CERC Corp.’s revolving credit facility was reduced from $950 million to
$915 million through removal of Lehman Brothers Bank, FSB (Lehman) as a lender. Prior to its removal, Lehman
had a $35 million commitment to lend. All credit facility loans to CERC Corp. that were funded by Lehman were
repaid in September 2009.
In October 2009, CERC amended its receivables facility to extend the termination date to October 8, 2010.
Availability under CERC’s 364-day receivables facility ranges from $150 million to $375 million, reflecting
seasonal changes in receivables balances.