8-KSecurities & Listing

CENTERPOINT ENERGY INC 8-K Report, Unregistered Securities Sale (Feb 7, 2007)

Filed February 7, 2007For Securities:CNP

Summary

CenterPoint Energy, Inc. (CNP) has filed an 8-K report detailing the redemption and conversion of its 2.875% Convertible Senior Notes due 2024. The company called for redemption of these notes in December 2006, with a redemption date of January 22, 2007. The redemption price involved a cash payment of $1,000 per $1,000 principal amount plus accrued interest. Upon the call for redemption, noteholders had the option to convert their notes into a combination of cash and CNP common stock, determined by the stock's trading price over a five-day period. The report indicates that substantially all of the outstanding $255 million in aggregate principal amount of notes were converted. As of February 5, 2007, CNP had satisfied its conversion obligations by delivering approximately $254.98 million in cash and a total of 5,616,952 shares of its common stock to former noteholders.

Key Highlights

  • 1CenterPoint Energy (CNP) has completed the redemption and conversion process for its 2.875% Convertible Senior Notes due 2024.
  • 2The company redeemed $255 million in principal amount of these notes.
  • 3Noteholders had the option to convert their notes into cash and CNP common stock, with most opting for conversion.
  • 4CNP delivered approximately $254.98 million in cash and 5,616,952 shares of common stock to satisfy conversion obligations.
  • 5The issuance of shares was made to existing security holders in exchange for their notes, utilizing the Section 3(a)(9) exemption from registration under the Securities Act of 1933.
  • 6The share issuance was completed by February 5, 2007, with conversions occurring throughout January and early February 2007.

Frequently Asked Questions

This 8-K filing was made to report on the redemption and conversion of CenterPoint Energy's outstanding 2.875% Convertible Senior Notes due 2024. It details the process, the amounts involved, and the shares issued to noteholders.

A total of 5,616,952 shares of CenterPoint Energy's common stock were issued to former noteholders upon conversion of the notes.

The company paid out approximately $254.98 million in cash to noteholders, which included the principal amount and accrued interest for converted notes, as well as cash in lieu of fractional shares.

No, the shares were issued under the exemption provided by Section 3(a)(9) of the Securities Act of 1933. This exemption applies when a company exchanges its own securities with existing security holders without paying commissions for solicitation.