CenterPoint Energy 2009 Annual Report Download - page 65

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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.
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.
Asset Management Agreements
In 2009, Gas Operations entered into various asset management agreements associated with its utility distribution
service in Arkansas, Louisiana, Mississippi, Oklahoma and Texas. Generally, these asset management agreements
are contracts between Gas Operations and an asset manager that are intended to transfer the working capital
obligation and maximize the utilization of the assets. In these agreements, Gas Operations agreed to release
transportation and storage capacity to other parties to manage gas storage, supply and delivery arrangements for Gas
Operations and to use the released capacity for other purposes when it is not needed for Gas Operations. Gas
Operations is compensated by the asset manager through payments made over the life of the agreements based in
part on the results of the asset optimization. Gas Operations has received approval from the state regulatory
commissions in Arkansas, Louisiana, Mississippi and Oklahoma to retain a share of the asset management
agreement proceeds, although the percentage of payments to be retained by Gas Operations varies based on the
jurisdiction, with the majority of the payments to benefit customers. The agreements have varying terms, the longest
of which expires in 2016.
CERTAIN FACTORS AFFECTING FUTURE EARNINGS
Our past earnings and results of operations are not necessarily indicative of our future earnings and results of
operations. The magnitude of our future earnings and results of our operations will depend on or be affected by
numerous factors including:
• the resolution of the true-up proceedings, including, in particular, the results of appeals to the Texas
Supreme Court regarding rulings obtained to date;
• state and federal legislative and regulatory actions or developments, including deregulation, re-regulation,
health care reform, and changes in or application of laws or regulations applicable to the various aspects of
our business;
• state and federal legislative and regulatory actions, developments or regulations relating to the
environment, including those related to global climate change;
• timely and appropriate legislative and regulatory actions allowing securitization or other recovery of costs
associated with any future hurricanes or natural disasters;
• timely and appropriate rate actions and increases, allowing recovery of costs and a reasonable return on
investment;
• cost overruns on major capital projects that cannot be recouped in prices;
• industrial, commercial and residential growth in our service territory and changes in market demand and
demographic patterns;