Summary
Eversource Energy (ES) filed an 8-K on June 5, 2019, to announce the completion of a significant equity offering. The company entered into a Forward Sale Agreement with Goldman Sachs & Co. LLC and an Underwriting Agreement with Goldman Sachs & Co. LLC and Barclays Capital Inc. This effectively led to the issuance and sale of approximately 6.0 million common shares to the public, with an option for underwriters to purchase an additional 2.3 million shares. The offering was priced at $71.48 per share and was expected to close around June 4, 2019. The forward sale agreement allows Eversource to potentially receive cash or additional shares at a future date, depending on market conditions and settlement choices.
Key Highlights
- 1Eversource Energy completed a substantial equity offering of approximately 6 million shares, with an option for an additional 2.3 million shares.
- 2The offering was priced at $71.48 per share.
- 3A Forward Sale Agreement with Goldman Sachs & Co. LLC was established, providing flexibility for future settlement (cash or shares) up to May 29, 2020.
- 4The initial forward sale price is set at $71.48 per share, subject to adjustments.
- 5The company has the option to settle the Forward Sale Agreement via cash or net share settlement, rather than physical issuance of shares.
- 6The Forward Counterparty (Goldman Sachs) has specific rights to accelerate the settlement under certain conditions, including increased borrowing costs or market events.
- 7The transaction was executed under a registration statement on Form S-3ASR.
Frequently Asked Questions
This filing (8-K) was made to report on the entry into material definitive agreements related to a significant equity offering by Eversource Energy, including an Underwriting Agreement and a Forward Sale Agreement.
Eversource Energy issued and sold 3,640,000 common shares and granted underwriters an option to purchase an additional 2,340,000 common shares, for a total potential issuance of up to 5,980,000 shares. The offering price was $71.48 per share.
The Forward Sale Agreement is an arrangement with Goldman Sachs where Eversource Energy agrees to sell shares at a future date. Initially priced at $71.48 per share, the price is subject to adjustments. Eversource has the flexibility to settle this agreement by either delivering shares, receiving cash, or a combination, depending on market conditions and its election. The settlement is expected to occur by May 29, 2020.
The Forward Sale Agreement includes provisions for acceleration by the Forward Counterparty (Goldman Sachs) under certain events. These can include increased costs for hedging, difficulty in borrowing shares, significant dividend declarations by Eversource, changes in control, delisting, or other specified default events. In case of bankruptcy or insolvency of Eversource, the agreement terminates.