HOUSTON, July 26 /PRNewswire-FirstCall/ -- Reliant Energy, Inc.
announced today that it is soliciting consents from all holders of:
* Three series of its outstanding Senior Secured Notes (collectively,
the "Notes"):
* 9.25% Senior Secured Notes due 2010 (CUSIP No. 75952BAF2);
* 9.50% Senior Secured Notes due 2013 (CUSIP No. 75952BAJ4); and
* 6.75% Senior Secured Notes due 2014 (CUSIP No. 75952BAM7); and
* Five series of Pennsylvania Economic Development Financing Authority's
outstanding Exempt Facilities Revenue Bonds (Reliant Energy Seward,
LLC Project) (collectively, the "Bonds"):
* Series 2001A (CUSIP No. 708686BJ8);
* Series 2002A (CUSIP No. 708686BM1);
* Series 2002B (CUSIP No. 708686BN9);
* Series 2003A (CUSIP No. 708686BK5); and
* Series 2004A (CUSIP No. 708686BL3).
The consents are being solicited with respect to proposed amendments to
the Indentures governing the Notes and the Guarantee Agreements governing
Reliant Energy's guarantees of the Bonds.
Reliant Energy is currently negotiating to enter into a new retail
credit structure. The primary purpose of the consent solicitation is to
amend the Indentures and the Guarantee Agreements to permit Reliant Energy
to enter into the new retail credit structure.
The new retail credit structure is intended to substantially eliminate
collateral postings and reduce liquidity requirements associated with
procuring supply for Reliant Energy's retail energy business. If
consummated, the new retail credit structure will include (1) a credit
support agreement pursuant to which the credit support provider will agree
to provide guarantees on behalf of Reliant Energy's retail energy business
and post collateral to counterparties in supply transactions related to the
retail energy business, and (2) a credit facility to finance the working
capital needs of the retail energy business, each of which will be secured
on a first lien basis by the assets of the retail energy business.
The proposed amendments to the Indentures and the Guarantees would:
* amend the restrictions on liens and indebtedness in the Indentures and
the Guarantee Agreements to permit the liens contemplated by the
credit support agreement and the new working capital credit facility
and to permit the indebtedness associated with the new working capital
credit facility;
* amend the restrictions in the Indentures and the Guarantee Agreements
on limitations on distributions by Reliant Energy's subsidiaries to
permit restrictions on the ability of the retail energy business to
upstream money to Reliant Energy; and
* make certain other technical amendments to the Indentures and the
Guarantee Agreements to permit the new retail credit structure.
In addition to amendments relating to the new retail credit structure,
the proposed amendments would conform the definition of "Significant
Subsidiary" in the Indentures relating to the 9.25% Senior Secured Notes
due 2010 and the 9.50% Senior Secured Notes due 2013 to the definition of
this term in the Indenture relating to the 6.75% Senior Secured Notes due
2014 and in the Guarantee Agreements.
The Consent Solicitation is being made to all persons in whose name a
Note or Bond is registered on July 25, 2006. The solicitation will expire
at 5:00 p.m., New York City time, on Thursday, August 3, 2006, unless
extended or terminated by Reliant Energy. For the proposed amendments to be
approved with respect to any series of Notes or Bonds, holders of record
must grant (and not revoke) valid consents in respect of a majority in
aggregate principal amount of all outstanding Notes or Bonds of such
series. Holders of Notes or Bonds will be able to revoke their consents as
to any series of Notes or Bonds until the time and date on which Reliant
Energy announces that the requisite consent to approve the amendments has
been achieved for such series of Notes or Bonds.
Promptly after the expiration of the consent solicitation and the
satisfaction or waiver of all conditions to the consent (as set forth in
the consent solicitation statement described below) applicable to a series
of Notes or Bonds, the Company will cause to be paid to each holder of
Notes or Bonds of such series who has delivered (and has not revoked) a
valid consent prior to the expiration of the consent solicitation a cash
consent fee of $1.25 for each $1,000 in principal amount of Notes or Bonds
in respect of which such consent has been delivered.
The detailed terms and conditions of the consent solicitation are
contained in a consent solicitation statement dated July 26, 2006. Goldman,
Sachs & Co. will act as Solicitation Agent for the consent solicitation.
Global Bondholder Services Corporation will act as the Information Agent.
Requests for documents may be directed to Global Bondholder Services
Corporation, by telephone at (866) 873-6300 (toll free) or (212) 430-3374.
Questions regarding the consent solicitation may be directed to Goldman,
Sachs & Co. at (800) 828-3182 (toll-free) or (212) 902-0041.
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 approximately 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 in
operation across the United States. These strategically located generating
assets utilize natural gas, fuel oil and coal. For more information, visit
http://www.reliant.com/corporate .
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, including the ongoing negotiation of the retail credit
structure, 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 in our filings 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/corporate
CONTACT:
investors, Dennis Barber, +1-713-497-3042, or
Kevin Kremke, +1-713-497-5468, or media, Pat Hammond,
+1-713-497-7723, all of Reliant Energy, Inc.
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