Reliant Energy executes supplemental indentures for 9¼%, 9½% notes

By Jennifer Chiou

New York, June 6 - Reliant Energy, Inc. entered into a fourth supplemental indenture for each of its $550 million of 9¼% senior secured notes due 2010 and its $550 million of 9½% senior secured notes due 2013, according to an 8-K filing with the Securities and Exchange Commission.

As of the consent deadline of 5 p.m. ET on June 5, Reliant received tenders from holders of $516.125 million, or 93.84%, of its 9¼% notes and $531.894 million, or 96.71%, of its 9½% notes.

The company is soliciting consents for a release of security interests in the collateral securing each series of notes and the elimination of most of the restrictive covenants and some related events of default contained in the indentures.

For each $1,000 principal amount of 9¼% notes, the company will determine its payout using the present value of $1,046.25, the redemption amount on July 15, 2007, which is the notes' earliest call date, discounted using the yield to maturity of the 3 5/8% Treasury due June 30, 2007 and 50 basis points.

For each $1,000 principal amount of 9½% notes, the company will determine its payout using the present value of $1,047.50, the redemption amount on July 15, 2008, which is the notes' earliest call date, discounted using the yield to maturity of the 5 1/8% Treasury due June 30, 2008 and 50 basis points.

Pricing will be set on June 8.

The payouts include a consent payment of $20.00 for those who tendered by the consent deadline.

The offers end at 11:59 p.m. ET on June 20. They launched on May 24.

Those who tender must deliver consents.

The offers are conditioned on sufficient financing from the issuance of a new series of senior unsecured notes and the company's replacement and refinancing of its existing credit facilities and entering into refinanced credit facilities.

Goldman, Sachs & Co., Deutsche Bank Securities, JPMorgan and Merrill Lynch & Co. are the dealer managers and solicitation agents (877 686-5059 or call collect 212 902-9077). Global Bondholder Services Corp. is the information agent (866 924-2200 or call collect 212 430-3774).

Based in Houston, Reliant Energy provides electricity and energy services.

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