8-KMaterial AgreementsFinancial EventsExhibits & Filings

AMEREN CORP 8-K Report, Material Agreement (Sep 8, 2006)

Filed September 8, 2006For Securities:AEE

Summary

This 8-K filing on September 8, 2006, details a significant change in the credit facilities for Ameren Corporation's subsidiaries: Central Illinois Public Service Company (AmerenCIPS), Central Illinois Light Company (AmerenCILCO), and Illinois Power Company (AmerenIP), collectively referred to as the Ameren Illinois Utilities. Effective September 8, 2006, these subsidiaries transitioned from a multi-borrower credit agreement to a dedicated $500 million senior secured credit facility, termed the 'Illinois Facility'. This move signifies a structural shift in how these operating companies access and secure their financing. The primary implication for investors is the segregation of debt and covenants for these specific utilities. By entering the Illinois Facility, the Ameren Illinois Utilities are no longer subject to certain covenants within the prior 2006 Multi-Borrower Credit Agreement, including restrictions on investments and transfers from Ameren, and their debt is excluded from the consolidated indebtedness to capitalization ratio calculation for that agreement. This also involved the issuance of significant mortgage bonds by each of the Ameren Illinois Utilities to secure their obligations under the new Illinois Facility, totaling $150 million for CILCO, $135 million for CIPS, and $150 million for IP.

Key Highlights

  • 1AmerenCIPS, AmerenCILCO, and AmerenIP (Ameren Illinois Utilities) entered a new $500 million senior secured credit facility ('Illinois Facility') effective September 8, 2006.
  • 2This move effectively terminates their obligations and removal from the prior 2006 Multi-Borrower Credit Agreement.
  • 3The Ameren Illinois Utilities are now secured by mortgage bonds issued specifically to back the Illinois Facility: $150 million for CILCO, $135 million for CIPS, and $150 million for IP.
  • 4This restructuring removes these utilities from certain covenants within the prior agreement, including restrictions on investments and transfers from Ameren.
  • 5The debt of the Ameren Illinois Utilities under the new Illinois Facility is excluded from the consolidated 65% total indebtedness to total capitalization financial covenant calculation in the terminated 2006 Multi-Borrower Credit Agreement.
  • 6The filing includes copies of Supplemental Indentures related to the mortgage bonds issued by each Ameren Illinois Utility to secure their obligations under the Illinois Facility.

Frequently Asked Questions

The main purpose of this 8-K filing is to announce that Ameren's operating subsidiaries in Illinois (AmerenCIPS, AmerenCILCO, and AmerenIP) have transitioned to a new, dedicated $500 million credit facility, called the 'Illinois Facility,' and have exited their previous multi-borrower credit agreement. This involves issuing specific mortgage bonds to secure the new facility.

By entering the Illinois Facility, the Ameren Illinois Utilities are no longer subject to certain covenants of the prior 2006 Multi-Borrower Credit Agreement. Specifically, restrictions on investments and transfers from Ameren to these utilities are lifted, and these utilities' debt is now excluded from the calculation of the 65% total consolidated indebtedness to total consolidated capitalization financial covenant in the prior agreement.

The new 'Illinois Facility' has a total commitment of $500 million. To secure this facility, AmerenCILCO issued $150 million in First Mortgage Bonds, AmerenCIPS issued $135 million in First Mortgage Bonds, and AmerenIP issued $150 million in Mortgage Bonds.

This filing primarily details a restructuring of financing for the Ameren Illinois Utilities and the associated collateralization through mortgage bonds. While it segregates financing for these subsidiaries, the impact on Ameren Corporation's consolidated debt levels would depend on the overall corporate financing strategy and should be reviewed in conjunction with other filings and financial statements.