CenterPoint Energy 2015 Annual Report Download - page 22

Sue B. Ortenstone hasservedasSenior Vice President and ChiefHumanResources Officer of CenterPoint EnergysinceFebruary2014.Prior to joining
CenterPointEnergy,Ms.OrtenstonewasSeniorVicePresidentandChiefAdministrativeOfficeratCopanoEnergyfromJuly2012toMay2013.Beforejoining
Copano,she spentmorethan30 yearsatEl PasoCorporationandserved mostrecentlyasSenior VicePresidentandthen ExecutiveVicePresidentand Chief
AdministrativeOfficerfromNovember2003toMay2012.Ms.OrtenstoneservesontheAdvisoryBoardforCivilandEnvironmentalEngineering,aswellasthe
Industrial Advisory Board in the College of Engineering at the University of Wisconsin. She also serves on the Board of Trustees for Northwest Assistance
MinistriesofHouston.
Item 1A. Risk Factors
Weareaholdingcompanythatconductsallofourbusinessoperationsthroughsubsidiaries,primarilyCenterPointHoustonandCERC.Wealsoowninterests
in Enable, a publicly tradedmidstream master limited partnership jointly controlled by CERCCorp. and OGE. The following,along with any additional legal
proceedingsidentifiedorincorporatedbyreferenceinItem3ofthisreport,summarizestheprincipalriskfactorsassociatedwiththebusinessesconductedbyour
subsidiariesandourinterestsinEnable:
Risk Factors Associated with Our Consolidated Financial Condition
As a holding company with no operations of our own, we will depend on distributions from our subsidiaries and from Enable to meet our payment
obligations and to pay dividends on our common stock, and provisions of applicable law or contractual restrictions could limit the amount of those
distributions.
Wederiveallofouroperatingincomefrom,andholdallofourassetsthrough,oursubsidiaries,includingourinterestsinEnable.Asaresult,wedependon
distributions from our subsidiaries, including Enable, in order to meet our payment obligations and to pay dividends on our common stock. In general, our
subsidiariesareseparateanddistinctlegalentitiesandhavenoobligationtoprovideuswithfundsforourpaymentobligations,whetherbydividends,distributions,
loansorotherwise.Inaddition,provisionsofapplicablelaw,suchasthoselimitingthelegalsourcesofdividends,limitoursubsidiaries’abilitytomakepayments
orotherdistributionsto us,and oursubsidiariescouldagreeto contractualrestrictionson theirabilitytomakedistributions. Foradiscussionofrisksthatmay
impact the amount of cash distributions we receive with respectto our interests in Enable, please read “— Additional Risk Factors Affecting OurInterests in
EnableMidstreamPartners,LP—OurcashflowswillbeadverselyimpactedifwereceivelesscashdistributionsfromEnablethanwecurrentlyexpect.”
Ourrighttoreceiveanyassetsofanysubsidiary,andthereforetherightofourcreditorstoparticipateinthoseassets,willbeeffectivelysubordinatedtothe
claims of that subsidiary’s creditors, including trade creditors. In addition, even if we were a creditor of any subsidiary, our rights as a creditor would be
subordinatedtoanysecurityinterestintheassetsofthatsubsidiaryandanyindebtednessofthesubsidiaryseniortothatheldbyus.
If we are unable to arrange future financings on acceptable terms, our ability to refinance existing indebtedness could be limited.
AsofDecember31,2015,wehad$8.8billionofoutstandingindebtednessonaconsolidatedbasis,whichincludes$2.7billionofnon-recoursetransitionand
systemrestorationbonds.AsofDecember31,2015,approximately$1.5billionprincipalamountofthisdebtisrequiredtobepaidthrough2018.Thisamount
excludes principal repayments of approximately $1.2 billion ontransition and system restoration bonds, for which dedicated revenue streams exist.Our future
financingactivitiesmaybesignificantlyaffectedby,amongotherthings:
•generaleconomicandcapitalmarketconditions;
• creditavailabilityfromfinancialinstitutionsandotherlenders;
• investorconfidenceinusandthemarketsinwhichweoperate;
•maintenanceofacceptablecreditratings;
• marketexpectationsregardingourfutureearningsandcashflows;
•marketperceptionsofourabilitytoaccesscapitalmarketsonreasonableterms;
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