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 (Date of earliest event reported): June 19, 2006 (June 13, 2006)
PEOPLES ENERGY CORPORATION
(Exact name of registrant as specified in its charter)
Illinois | | 1-5540 | | 36-2642766 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
130 East Randolph Drive, 24th Floor Chicago, Illinois | | 60601-6207 |
| (Address of principal executive office) | | (Zip Code) |
Registrant's telephone number, including area code: (312) 240-4000
None
(Former name or former address, if changed since last report)
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 (see General Instruction A.2. below):
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. Entry into a Material Definitive Agreement
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
On June 13, 2006, Peoples Energy Corporation ("Peoples Energy") entered into a syndicated revolving $400 million credit agreement with Bank of America as the administrative agent and the financial institutions party thereto. The credit agreement is effective from June 13, 2006 through June 13, 2011, provided that the credit agreement may be extended pursuant to its terms. Funds may be used for general corporate purposes and commercial paper back-up.
Borrowings under the credit agreement may accrue interest at either (1) the greater of (a) the prime commercial lending rate announced from time to time by Bank of America, or (b) the Federal funds rates plus one-half of one percent, or (2) a rate based on the LIBOR rate in effect at the time of such borrowing plus an applicable margin determined by Peoples Energy’s credit rating.
The credit agreement may be terminated and repayment of the loans under each credit agreement could be accelerated if, among other things, any of the following events were to occur:
| | i. | non-payment of amounts borrowed when due or non-payment of fees or interest within five days of the due date; |
| ii. | failure to observe certain covenants, including: |
| a. | failure to maintain a ratio of total debt to total debt plus equity of at least 0.65 to 1.00, or |
| b. | selling, leasing or otherwise disposing of more than (1) 35% of its consolidated fixed assets or (2) 15% of its consolidated "regulated assets"; |
| | iii. | with respect to indebtedness in an amount of $15 million or more existing other the under each credit agreement, the occurrence of events which permit the payment thereof to become accelerated; |
| | iv. | the failure of Peoples Energy to pay judgments against it in amounts of $15 million or more within thirty days; |
| v. | certain events related to insolvency or the commencement of bankruptcy proceedings; |
| | vi. | failure to pay certain amounts with respect to employee benefit plans as required by the Employee Retirement Income Security Act of 1974, as amended. |
This credit agreement replaces the exiting syndicated revolving $250 million credit agreement between Peoples Energy and the financial institutions party thereto dated March 8, 2004. The new credit agreement will be filed as an exhibit to the Quarterly Report on Form 10-Q for the period ending June 30, 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 hereunto duly authorized.
| | | PEOPLES ENERGY CORPORATION |
| | | (Registrant) |
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| Date: June 19, 2006 | | By: /s/ THOMAS A. NARDI |
| | | Thomas A. Nardi |
| | | Executive Vice President and Chief Financial Officer |
