8-KOther EventsExhibits & Filings

ONEOK INC /NEW/ 8-K Report, Corporate Update (Nov 2, 2005)

Filed November 2, 2005For Securities:OKE

Summary

ONEOK, Inc. (OKE) filed an 8-K on November 2, 2005, to disclose the proposed remarketing of its 4% senior notes due February 16, 2008. This event, dated November 1, 2005, involves UBS Securities LLC acting as the remarketing agent, with the goal of resetting the interest rate and remarketing the notes on November 10, 2005. The new interest rate will be determined based on the market conditions and aims to remarket the notes at approximately 100.5% of the purchase price of a specified U.S. Treasury securities portfolio. A successful remarketing will result in the proceeds being used to purchase U.S. Treasury securities, which will then serve as collateral for the equity purchase contracts associated with these notes. These contracts obligate holders to purchase OKE common stock on February 16, 2006. The company will continue to have $402.5 million of these senior notes outstanding post-remarketing. This action is a significant event for noteholders as it impacts the interest rate and the collateral structure supporting their future equity purchase obligations.

Key Highlights

  • 1ONEOK announced the proposed remarketing of its 4% senior notes due February 16, 2008.
  • 2The remarketing is scheduled to occur on November 10, 2005, with UBS Securities LLC as the remarketing agent.
  • 3The primary objective is to reset the interest rate on the senior notes to reflect current market conditions.
  • 4If successful, the notes will be remarketed at approximately 100.5% of the purchase price of a specific U.S. Treasury securities portfolio.
  • 5Proceeds from the remarketing will be used to purchase U.S. Treasury securities to collateralize equity purchase contracts for OKE common stock.
  • 6Holders of record as of November 9, 2005, are eligible for any excess remarketing proceeds.
  • 7The total principal amount of senior notes outstanding ($402.5 million) will remain unchanged after the remarketing.

Frequently Asked Questions

A remarketing, in this scenario, is an offering by a remarketing agent (UBS Securities LLC) to sell existing debt securities (ONEOK's 4% senior notes due 2008) to new investors in the market. The goal is typically to adjust the interest rate to a level that is attractive to current market conditions and to ensure the notes are sold at or near par value.

The new interest rate will be determined on November 10, 2005. It will be set at a level that allows the senior notes to be remarketed at approximately 100.5% of the purchase price of a specified portfolio of U.S. Treasury securities, plus any other separate senior notes participating in the remarketing. This rate will become effective on November 16, 2005, if the remarketing is successful.

Each corporate unit consists of a senior note and an equity purchase contract. If the senior notes are successfully remarketed, the proceeds will be used to buy U.S. Treasury securities. These Treasury securities will then serve as collateral for the equity purchase contracts, which obligate holders to buy OKE common stock on February 16, 2006. Holders of record on November 9, 2005, are eligible for any excess proceeds from the remarketing after fees and the cost of the Treasury portfolio.

No, the filing states that following the conclusion of the remarketing, ONEOK will continue to have $402.5 million of senior notes due February 16, 2008, outstanding. The remarketing is essentially a refinancing or repricing of the existing debt, not an issuance of new debt or a retirement of debt.