UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of Report: July 31, 2006
(Date
of Earliest Event Reported)
EL
PASO CORPORATION
(Exact
name of Registrant as specified in its charter)
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Delaware
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1-14365
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76-0568816
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(State
or
other jurisdiction of
incorporation
or organization)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
No.)
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El
Paso Building
1001
Louisiana Street
Houston,
Texas 77002
(Address
of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code (713) 420-2600
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01. Entry into a Material Definitive Agreement.
On
July 31, 2006,
we and certain of our pipeline subsidiaries, Colorado Interstate Gas Company
(CIG), El Paso Natural Gas Company (EPNG) and Tennessee Gas Pipeline Company
(TGP), entered into a $1.75 billion Amended and Restated Credit Agreement
(“Credit Agreement”) and an Amended and Restated Security Agreement (“Security
Agreement”), each of which is attached as an exhibit hereto and incorporated
herein by reference. The several banks and other financial institutions
that are
parties to these agreements are identified in the exhibits hereto. These
agreements amended and restated our existing $3 billion credit facility
and
related security agreement, of which the $1 billion revolving credit
facility was scheduled to mature on November 23, 2007.
The
Credit
Agreement is comprised of (1) a $1.25 billion revolving credit facility,
and (2)
a $500 million funded letter of credit facility.
Pursuant
to the
terms of the Security Agreement, all obligations under the Credit Agreement
are
secured by certain inter-company receivables and by pledges of our interests
in
CIG, EPNG, and TGP. We and certain of our subsidiaries also guarantee all
of the borrowings under the Credit Agreement.
The
$1.25 billion
revolving credit facility matures in July 2009 and will initially have
no borrowings. The $500 million funded letter of credit facility
matures in July 2011. The entire $1.75 billion line of credit may be
used for revolving loans or the support of letters of credit. At closing,
approximately $1.1 billion of these facilities were used for outstanding
letters
of credit.
Under
the $1.25
billion revolving credit facility, revolving loans are priced at LIBOR
plus a
margin currently equal to 1.75 percent and outstanding letters of credit,
which are considered usage of the revolving credit facility, will be priced
at
1.75 percent plus an additional fronting fee of 0.15 percent. An annual
commitment fee of 0.375 percent is paid on any unused revolving credit
capacity.
Under
the $500
million funded letter of credit facility, we will pay 2.10 percent on the
full
deposit amount plus an additional fronting fee of 0.05 percent on outstanding
letters of credit and outstanding borrowings will be priced at LIBOR plus
2.00
percent.
This
Credit
Agreement contains covenants restricting the ability of us and our pipeline
company borrowers to: (1) incur certain indebtedness; (2) grant
certain liens; (3) enter into certain merger or consolidation transactions;
(4) dispose of assets; (5) enter into certain affiliate transactions;
and (6) enter into certain other restrictive agreements.
This
Credit
Agreement also requires us to satisfy certain financial covenants at the
end of
each fiscal quarter, including:
(1) our
ratio
of Debt and Guaranties to Consolidated EBITDA, each as defined in the Credit
Agreement, shall not exceed 5.75 to 1.0 at any time prior to June 30, 2007;
5.50
to 1.0 at any time on or after June 30, 2007 and prior to June 30, 2008;
and
5.25 to 1.0 at any time on or after June 30, 2008 until maturity; and
(2)
our ratio of
Consolidated EBITDA to interest expense and dividends paid shall not be
less
than 1.75 to 1.0 prior to December 31, 2006; 1.80 to 1.0 on or after December
31, 2006 and prior to June 30, 2008; and 2.0 to 1.0 on or after June 30,
2008
until maturity. Furthermore, the current debt limitations on the
pipeline company borrowers— CIG, EPNG, and TGP —will continue, which includes a
restriction on the pipeline company borrowers' incurrence of incremental
borrowings if such debt would cause their ratio of Debt to Consolidated
EBITDA
to exceed 5.0 to 1.0.
Pursuant
to the
terms of the Credit Agreement, the following shall constitute events of
default
under the Credit Agreement:
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a
failure to
pay principal or interest on any loan under the credit
agreement;
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if
a
representation or warranty is proven to be incorrect when
made;
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a
change of
control or the failure to observe or perform covenants or
agreements;
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the
commencement of proceedings under federal, state or foreign
bankruptcy,
insolvency, receivership or similar
laws;
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inability
or
general failure to pay debts as they become
due;
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the
entry of
one or more judgments for the payment of money in an aggregate
uninsured
amount equal to or greater than $100,000,000 that remains undischarged
for
60 days; or
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suffering
an
event of default and the lapse of any applicable grace period
under any
other Indebtedness (as defined in the Credit Agreement) in
excess of
$200,000,000.
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If
an event of
default occurs, then the lenders may: (1) terminate their commitments under
the Credit Agreement; (2) declare any outstanding loans under the Credit
Agreement to be immediately due and payable after applicable grace periods;
and
(3) foreclose on the collateral.
Item 2.03.
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
See
description
above in Item 1.01.
Item 8.01 Other Events
A
copy of our press release announcing the closing of our new credit facilities
is
attached as Exhibit 99.A and is incorporated herein by
reference.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit
Number
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Description
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10.A.
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Amended
and
Restated Credit Agreement dated as of July 31, 2006, among El
Paso
Corporation, Colorado Interstate Gas Company, El Paso Natural
Gas Company,
Tennessee Gas Pipeline Company, the several banks and other financial
institutions from time to time parties thereto and JPMorgan Chase
Bank,
N.A., as administrative agent and as collateral agent.
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10.B
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Amended
and
Restated Security Agreement dated as of July 31, 2006, made by
among El
Paso Corporation, Colorado Interstate Gas Company, El Paso Natural
Gas
Company, Tennessee Gas Pipeline Company, the Subsidiary Grantors
and
certain other credit parties thereto and JPMorgan Chase Bank,
N.A., not in
its individual capacity, but solely as collateral agent for the
Secured
Parties and as the depository bank.
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10.C
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Amended
and
Restated Parent Guarantee Agreement dated as of July 31, 2006,
made by El
Paso Corporation, in favor of JPMorgan Chase Bank, N.A., as Collateral
Agent.
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10.D
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Amended
and
Restated Subsidiary Guarantee Agreement dated as of July 31,
2006, made by
each of the Subsidiary Guarantors in favor of JPMorgan Chase
Bank, N.A.,
as Collateral Agent.
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99.A
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Press Release dated July 31, 2006. |
SIGNATURES
Pursuant
to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto
duly
authorized.
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EL
PASO CORPORATION
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By:
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/s/
John R. Sult
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John
R. Sult
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Senior
Vice President and Controller
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(Principal
Accounting Officer)
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Dated: August
2, 2006
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EXHIBIT
INDEX
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Exhibit
Number
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Description
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10.A.
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Amended
and
Restated Credit Agreement dated as of July 31, 2006, among El Paso
Corporation, Colorado Interstate Gas Company, El Paso Natural Gas
Company,
Tennessee Gas Pipeline Company, the several banks and other financial
institutions from time to time parties thereto and JPMorgan Chase
Bank,
N.A., as administrative agent and as collateral agent.
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10.B
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Amended
and
Restated Security Agreement dated as of July 31, 2006, made by
among El
Paso Corporation, Colorado Interstate Gas Company, El Paso Natural
Gas
Company, Tennessee Gas Pipeline Company, the Subsidiary Grantors
and
certain other credit parties thereto and JPMorgan Chase Bank, N.A.,
not in
its individual capacity, but solely as collateral agent for the
Secured
Parties and as the depository bank.
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10.C
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Amended
and
Restated Parent Guarantee Agreement dated as of July 31, 2006,
made by El
Paso Corporation, in favor of JPMorgan Chase Bank, N.A., as Collateral
Agent.
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10.D
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Amended
and
Restated Subsidiary Guarantee Agreement dated as of July 31, 2006,
made by
each of the Subsidiary Guarantors in favor of JPMorgan Chase Bank,
N.A.,
as Collateral Agent.
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99.A
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Press
Release
dated July 31, 2006.
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