HOUSTON, May 23 /PRNewswire-FirstCall/ -- Reliant Energy, Inc.,
announced today that it has commenced tender offers and related
solicitations of consents for $1.1 billion of its outstanding senior
secured notes (as described in the table below and, collectively, the
"notes"). Reliant is soliciting consents to a release of security interests
in the collateral securing each series of the notes and to certain proposed
amendments to the indentures governing each series of the notes. The terms
and conditions of the tender offers and related consent solicitations are
described in offers to purchase and consent solicitations statement dated
May 23, 2007 (the "statement").
The table below provides information about each series of notes included
in the tender offers.
Aggregate
Principal Amount on
Amount of Earliest
Notes Earliest Redemption
Notes Identifiers Outstanding Redemption Date Date
9.25% Senior
Secured Notes due
2010 (the "2010 CUSIP No.
Notes") 75952B AF 2 $550,000,000 July 15, 2007 $1,046.25
Reference Reference Fixed Consent
Security Source Spread Payment
9.25% Senior
Secured Notes due 3.625% U.S.
2010 (the "2010 Treasury Note due
Notes") June 30, 2007 PX3 50bps $20.00
Aggregate
Principal Amount on
Amount of Earliest
Notes Earliest Redemption
Notes Identifiers Outstanding Redemption Date Date
9.50% Senior
Secured Notes due
2013 (the "2013 CUSIP No.
Notes") 75952B AJ 4 $550,000,000 July 15, 2008 $1,047.50
Reference Reference Fixed Consent
Security Source Spread Payment
9.50% Senior
Secured Notes due 5.125% U.S.
2013 (the "2013 Treasury Note due
Notes") June 30, 2008 PX4 50bps $20.00
The tender offers will expire at 11:59 p.m., New York City time, on
June 20, 2007, unless extended or earlier terminated (such date and time,
as the same may be extended, the "expiration date"). The solicitations will
expire at 5:00 p.m., New York City time, on June 5, 2007, unless extended
by Reliant (such date and time, as the same may be extended, the "consent
payment deadline").
Holders tendering a series of notes must consent to the release and the
proposed amendments to such Notes and to the indentures governing such
notes, which would eliminate most of the restrictive covenants contained in
the indentures and the notes of such series and certain related events of
default, and release the collateral securing the notes. Holders may not
tender their notes without also delivering consents and may not deliver
consents without also tendering their notes.
The total consideration is equal to the present value on the early
payment date (as defined below) or the final payment date (as defined
below), as the case may be, of all future payments on each applicable
series of notes to the first date on which such series of the notes may be
redeemed at the option of Reliant (such date, the "earliest redemption
date" as set forth for each series of the notes under the heading "earliest
redemption date" in the table above), calculated in accordance with
standard market practice as described in the statement, based on the
assumption that the 2010 notes and 2013 notes will be redeemed in full at
$1,046.25 and $1,047.50, respectively, per $1,000 principal amount on the
earliest redemption date and that the yield to the earliest redemption date
is equal to the sum of (a) the bid-side yield on the "reference security"
(as set forth for each series of the notes under the heading "reference
security" in the table above), as calculated by the dealer managers for the
tender offers in accordance with standard market practice, based on the bid
price for such reference security as of 2:00 p.m., New York City time, on
the price determination date (as defined below) plus (b) 50 basis points
(such price being rounded to the nearest $0.01 per $1,000 principal amount
of each series of the notes) (the "fixed spread"), minus accrued but unpaid
interest to, but not including, the early payment date or the final payment
date, as the case may be.
The total consideration described above includes a consent payment of
$20.00 per $1,000 principal amount of each series of notes. Holders of the
notes must validly tender and not validly withdraw notes and validly
consent on or prior to the consent payment deadline in order to be eligible
to receive the applicable total consideration (which includes the
applicable consent payment described in the foregoing sentence) for such
notes purchased in the tender offers. Holders who validly tender their
notes after the consent payment deadline and on or prior to the offer
expiration date will be eligible to receive the tender offer consideration
which is an amount, paid in cash, equal to the applicable total
consideration less the applicable consent payment.
In each case, holders whose notes are accepted for payment in the
tender offers will receive accrued and unpaid interest in respect of such
purchased notes from the last interest payment date to, but not including,
the applicable payment date for notes purchased in the tender offers.
The price determination date shall initially be June 8, 2007, though
this date may change if Reliant extends any of the tender offers, as
described more fully in the statement.
Reliant reserves the right, at any time following the consent payment
deadline but prior to the Expiration Date (the "early acceptance time"), to
accept for purchase all the notes validly tendered prior to the early
acceptance time. If Reliant elects to exercise this option, it will pay the
total consideration or tender offer consideration, as the case may be, for
the notes accepted for purchase at the early acceptance time on such date
(the "early payment date") promptly following the early acceptance time.
Subject to the terms and conditions of the tender offers, Reliant will,
at such time after the Expiration Date (the "final acceptance time"),
accept for purchase all the notes validly tendered prior to the Expiration
Date (or if Reliant has exercised its early purchase option described
above, all the notes validly tendered after the early acceptance time and
prior to the Expiration Date). Reliant will pay the Total Consideration or
tender offer consideration, as the case may be, for the notes accepted for
purchase at the final acceptance time on such date (the "final payment
date") promptly following the final acceptance time.
The tender offers and consent solicitations relating to the notes are
made upon the terms and conditions set forth in the statement and the
related letter of transmittal. The tender offers and consent solicitations
are subject to the satisfaction of certain conditions, including Reliant's
receipt of proceeds from the issuance of a new series of senior unsecured
notes, and its replacement and refinancing of its existing credit
facilities and entering into refinanced credit facilities, on or prior to
the early acceptance time or the final acceptance time, as the case may be,
on terms satisfactory to Reliant, which proceeds will be used to redeem the
notes.
Reliant has retained Goldman, Sachs & Co., Deutsche Bank Securities,
JPMorgan and Merrill Lynch & Co. to act as the dealer managers for the
tender offers and as solicitation agents for the consent solicitations, and
they can be contacted at (877) 686-5059 (toll-free) ((212) 902-9077
(collect)). The statement and other documents relating to the tender offers
and consent solicitations are expected to be distributed to holders
beginning today. Requests for documentation may be directed to Global
Bondholder Services Corporation, the Information Agent, which can be
contacted at (212) 430-3774 (for banks and brokers only) or (866) 924-2200
(for all others toll-free).
This release is for informational purposes only and is neither an offer
to purchase nor a solicitation of an offer to sell the notes. The offer to
buy the notes is only being made pursuant to the tender offers and consent
solicitations documents, including the statement that Reliant Energy, Inc.
is distributing to holders of notes. The tender offers and consent
solicitations are not being made to holders of notes in any jurisdiction in
which the making or acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. In any
jurisdiction in which the securities laws or blue sky laws require the
tender offers and consent solicitations to be made by a licensed broker or
dealer, the tender offers and consent solicitations will be deemed to be
made on behalf of Reliant by the dealer managers, or one or more registered
brokers or dealers that are licensed under the laws of such jurisdiction.
Reliant Energy, Inc. (NYSE: RRI) based in Houston, Texas, provides
electricity and energy services to retail and wholesale customers in the
United States. In Texas, the company provides service to nearly 1.9 million
retail electricity customers, including residential and small business
customers and commercial, industrial, governmental and institutional
customers. Reliant also serves commercial, industrial, governmental and
institutional customers in the PJM (Pennsylvania, New Jersey and Maryland)
market.
The company is one of the largest independent power producers in the
nation with approximately 16,000 megawatts of power generation capacity
across the United States. These strategically located generating assets
utilize natural gas, fuel oil and coal. For more information, visit
http://www.reliant.com.
This news release contains "forward-looking statements."
Forward-looking statements are statements that contain projections,
estimates or assumptions about our revenues, income and other financial
items, our plans for the future, future economic performance, transactions
and dispositions and financings related thereto. Forward-looking statements
relate to future events and anticipated revenues, earnings, business
strategies, competitive position or other aspects of our operations or
operating results. In many cases you can identify forward-looking
statements by terminology such as "anticipate," "estimate," "believe,"
"continue," "could," "intend," "may," "plan," "potential," "predict,"
"should," "will," "expect," "objective," "projection," "forecast," "goal,"
"guidance," "outlook," "effort," "target" and other similar words. However,
the absence of these words does not mean that the statements are not
forward-looking.
We have based our forward-looking statements on management's beliefs
and assumptions based on information available to management at the time
the statements are made. Actual results may differ materially from those
expressed or implied by forward-looking statements as a result of many
factors or events, access to capital, legislative and regulatory
developments, the effects of competition, financial market conditions, the
timing and extent of changes in commodity prices and interest rates,
weather conditions, changes in our business plan and other factors we
discuss or reference to in the "Risk Factors" section of our most recent
Annual Report on Form 10-K filed with the Securities and Exchange
Commission.
Each forward-looking statement speaks only as of the date of the
particular statement and we undertake no obligation to update or revise any
forward-looking statement, whether as a result of new information, future
events or otherwise.
SOURCE Reliant Energy, Inc.
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Related links:
http://www.reliant.com
CONTACT:
investors, Dennis Barber, +1-713-497-3042, or
media, Pat Hammond, +1-713-497-7723, both of Reliant Energy, Inc.
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