UNITED STATES OF AMERICA
before the
SECURITIES AND EXCHANGE COMMISSION
----------
In the Matter of:
CENTERPOINT ENERGY, INC. CERTIFICATE OF
1111 Louisiana NOTIFICATION
Houston, Texas 77002
(70-10128)
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
----------
THIS IS TO CERTIFY that, in accordance with the terms and conditions of
the application-declaration, as amended, of CenterPoint Energy, Inc. in the
above-captioned file (the "Application") and the order of the Securities and
Exchange Commission with respect thereto (HCAR No. 27692 (June 30, 2003)) (the
"Order"), CenterPoint Energy, Inc. (the "Company" or "CenterPoint") is reporting
the following information for itself and its subsidiaries for the quarterly
period ended December 31, 2003. Unless defined herein, capitalized terms have
the meaning given them in the Application.
1. The sales of any common stock or preferred securities by the Company or
a Financing Subsidiary and the purchase price per share and the market
price per share at the date of the agreement of sale.
None.
1
2. The total number of shares of the Company's common stock issued or
issuable pursuant to options granted during the quarter under employee
benefit plans and dividend reinvestment plans, including any employee
benefit plans or dividend reinvestment plans hereafter adopted.
228,552 shares were issued under the Investor's Choice Plan.
A total of 50,874 shares were issued on the exercise of previously
issued stock options, and 1,791 shares were issued under the terms of
the 2001 Incentive Compensation Plan. 10,000 shares were issued to the
Company's non-executive chairman pursuant to the terms of a 2002
agreement under which he assumed his responsibilities.
3. If the Company's common stock has been transferred to a seller of
securities of a company being acquired, the number of shares so issued,
the value per share and whether the shares are restricted in the hands
of the acquirer.
None.
4. If a guarantee is issued during the quarter, the name of the guarantor,
the name of the beneficiary of the guarantee and the amount, terms and
purpose of the guarantee.
See Exhibit A
5. The amount and terms of any long-term debt issued by the Company during
the quarter, and the aggregate amount of short-term debt outstanding as
of the end of the quarter, as well as the weighted average interest
rate for such short-term debt as of such date.
On October 7, 2003, the Company refinanced its existing bank credit
facility by entering into two new three-year facilities: (i) a $1.425
billion revolving credit facility with a group of banks and (ii) a $923
million term loan facility from institutional investors. Both
facilities, like the credit facility they replaced, are secured by a
pledge of the common stock the Company owns in Texas Genco.
2
In December 2003, the Company issued $255 million of 2.875% convertible
notes, due 2024. Proceeds from the notes were designated to redeem $250
million aggregate liquidation amount of 8.125% trust preferred
securities issued by HL&P Capital Trust I.
None of the Company's debt is classified as short-term debt.
6. The amount and terms of any long-term debt issued by any Utility
Subsidiary during the quarter, and the aggregate amount of short-term
debt outstanding as of the end of the quarter, as well as the weighted
average interest rate for such short-term debt as of such date
On November 3, 2003, CenterPoint Energy Resources Corp. ("GasCo")
issued $160 million aggregate principal amount of its 5.95% senior
unsecured notes due 2014. GasCo accepted $140 million aggregate
principal amount of GasCo's TERM Notes maturing in November 2003 and
$1.25 million as consideration for the notes. GasCo retired the TERM
notes received and used the remaining proceeds to finance remaining
costs of issuance of the notes and for general corporate purposes.
In October 2003, the Federal Energy Regulatory Commission issued an
order recognizing Texas Genco, LP as an exempt wholesale generator
under Section 33 of the Act. As a result of that order, the Texas Genco
Holdings, Inc. and its subsidiaries are no longer treated as utility
subsidiaries of the Company.
The aggregate amount of short-term debt outstanding as of the end of
the quarter for the Utility Subsidiaries was $63 million. The weighted
average interest rate for such short-term debt as of such date was
5.0%.
7. The amount and terms of any financings consummated by any Non-Utility
Subsidiary that are not exempt under Rule 52 under the Public Utility
Holding Company Act, as amended.
None.
8. The notional amount and principal terms of any Hedge Instruments or
Anticipatory Hedges entered into during the quarter and the identity of
the other parties thereto.
None.
3
9. The name, parent company and amount of equity in any intermediate
subsidiary during the quarter and the amount and terms of any
securities issued by such subsidiaries during the quarter.
The name, parent company and amount of equity in any intermediate
subsidiaries has been previously disclosed. There were no securities
issued by such subsidiaries during the quarter except as described
under Item 18 in connection with an internal reorganization of two
unregulated GasCo subsidiaries.
10. The information required by a Certificate of Notification on Form
U-6B-2.
Not applicable.
11. The amount and terms of any other securities issued under the authority
sought herein during the quarter.
None.
12. Consolidated balance sheets for the Company and/or a Utility Subsidiary
as of the end of the quarter and separate balance sheets as of the end
of the quarter for each company that has engaged in jurisdictional
financing transactions during the quarter.
See Exhibit B hereto. See also the Annual Report on Form 10-K filed by
the Company on January 15, 2004 (File No. 1-31447), the Annual Report
on Form 10-K filed by CenterPoint Energy Resources Corp. on January 15,
2004 (File No. 1-13265), and the Annual Report on Form 10-K filed by
CenterPoint Energy Houston Electric, LLC on January 15, 2004 (File No.
1-3187), all of which are incorporated herein by reference.
13. A table showing, as of the end of the quarter, the dollar and
percentage components of the capital structure of the Company on a
consolidated basis and of each Utility Subsidiary.
See Exhibit C hereto.
4
14. A retained earnings analysis of the Company on a consolidated basis and
of each Utility Subsidiary detailing gross earnings, dividends paid out
of each capital account and the resulting capital account balances at
the end of the quarter.
See Exhibit D hereto.
15. A table showing, as of the end of the quarter, the Money Pool
participants and amount of outstanding borrowings for each.
See Exhibit E hereto.
16. As to each financing subsidiary, (a) the name of the subsidiary; (b)
the value of the Company's investment account in such subsidiary; (c)
the balance sheet account where the investment and the cost of the
investment are booked; (d) the amount invested in the subsidiary by the
Company; (e) the type of corporate entity; (f) the percentage owned by
the Company; (g) the identification of other owners if not 100% owned
by the Company; (h) the purpose of the investment in the subsidiary;
and (i) the amounts and types of securities to be issued by the
subsidiary.
See Exhibit F hereto. The Company and its subsidiaries may organize and
acquire, directly or indirectly, the common stock or other equity
interests of one or more financing subsidiaries for the purpose of
effecting various financing transactions from time to time through the
Authorization Period. Financing Subsidiaries may be corporations,
trusts, partnerships or other entities created specifically for the
purposes described in the Order. The amount of securities issued by the
Financing Subsidiaries to third parties will count toward the
respective financing limits of its immediate parent. Applicants
anticipate that the Financing Subsidiaries will be wholly-owned
indirect subsidiaries of CenterPoint and fully consolidated for
purposes of financial reporting. Such financing subsidiaries shall be
organized only if, in management's opinion, the creation and
utilization of such financing subsidiary will likely result in tax
savings, increased access to capital markets and/or lower cost of
capital for the Company or its subsidiaries.
17. A confidential exhibit updating CenterPoint's financial projections and
assumptions through 2006.
See Exhibit G hereto.
5
18. With respect to any internal reorganization of any Subsidiaries during
the quarter, a description of the nature of such reorganization.
On December 31, 2003 two subsidiaries of GasCo, Industrial Gas Supply
Corporation and Unit Gas Transmission Company, merged into another
subsidiary of GasCo, Louisiana Unit Gas Transmission Company, which
changed its name to CenterPoint Energy Intrastate Pipelines, Inc.
On December 31, 2003 two subsidiaries of GasCo, CenterPoint Energy Gas
Resources Corp. (a Texas corporation) and CenterPoint Energy Gas
Marketing Company (a Delaware corporation) merged into a third
subsidiary of GasCo, CenterPoint Energy Marketing, Inc. (a Delaware
corporation). CenterPoint Energy Marketing, Inc. is the surviving
company following the merger and its name was changed to CenterPoint
Energy Gas Services, Inc.
19. A report of service transactions among the Company (or any other system
service provider) and the Utility Subsidiaries containing the following
information (a) a narrative description of the services rendered; (b)
disclosure of the dollar amount of services rendered in (a) above
according to category or department; (c) identification of companies
rendering services described in (a) above and recipient companies,
including disclosure of the allocation of services costs; and (d)
disclosure of the number of the CenterPoint system employees engaged in
rendering services to other CenterPoint system companies on an annual
basis, stated as an absolute and as a percentage of total employees.
See Exhibit H hereto. Until the formation of a service company on
January 1, 2004, CenterPoint Energy provided common and shared services
for its subsidiaries through its approximately 1,100 employees
(approximately 10% of total employees). Under its cost allocation
methodology, which previously has been submitted to regulators in the
various states in which CenterPoint utility subsidiaries operate, costs
incurred directly for an operating unit are directly charged to that
unit at cost. Costs that could not be directly charged were allocated
to the business units using appropriate allocators.
6
All transactions described herein have been carried out in accordance
with the terms and conditions of and for the purposes represented in the
Application.
CENTERPOINT ENERGY, INC.
By:/s/ Rufus S. Scott
--------------------------------------
Rufus S. Scott
Vice President, Deputy General Counsel
and Assistant Corporate Secretary
Dated: March 31, 2004
7
Exhibits
--------
Exhibit Description
Exhibit A CenterPoint Energy, Inc., CenterPoint Energy Resources Corp.
and Texas Genco Holdings, Inc. Guaranties Issued or Amended
During Fourth Quarter 2003 (filed in connection herewith with
a request for confidential treatment)
Exhibit B Consolidated Balance Sheets for CenterPoint Energy, Inc. and
Subsidiaries, CenterPoint Energy Houston Electric, LLC and
Subsidiaries, CenterPoint Energy Resources Corp. and
Subsidiaries and Texas Genco Holdings, Inc. (as of December
31, 2003)
Exhibit C Capital Structure Chart of CenterPoint Energy, Inc.,
CenterPoint Energy Houston Electric, LLC, CenterPoint Energy
Resources Corp. and Texas Genco Holdings, Inc. as of December
31, 2003
Exhibit D Retained Earnings Analysis of CenterPoint Energy, Inc.,
CenterPoint Energy Resources Corp., CenterPoint Energy Houston
Electric, LLC and Texas Genco Holdings, Inc.
Exhibit E Money Pool Participants and Outstanding Borrowings as of
December 31, 2003
Exhibit F CenterPoint Energy, Inc. Investments in Financing Subsidiaries
as of December 31, 2003
Exhibit G CenterPoint Consolidated Financials (forecasts through 2006)
(filed in connection herewith with a request for confidential
treatment)
Exhibit H Information on Service Transactions between CenterPoint
Energy, Inc. and Utility Subsidiaries (Corporate Services,
Support Services and Information Technology Services)
8