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 2, 2003
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Mirant Corporation
(Exact name of registrant as specified in its charter)
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Delaware 001-16107 58-2056305
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(State or other jurisdiction (Commission File (IRS Employer Identification
of incorporation) Number) No.)
1155 Perimeter Center West Suite 100, Atlanta, Georgia 30338
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (678) 579-5000
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N/A
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(Former name or former address, if changed since last report.)
Item 5. Other
Recent Developments
Dispositions
In May 2003, Mirant announced that it had entered into agreements to sell
its Canadian natural gas aggregator services contracts, a significant portion of
its natural gas transportation contracts and a portion of its storage contracts.
The contracts included in the sale represent 380 million cubic feet per day of
natural gas transportation assets and approximately 1.3 billion cubic feet of
natural gas storage, as well as Mirant's "netback pool." The netback pool is the
portion of the natural gas marketing contracts that market the aggregate supply
of natural gas from over 500 Canadian natural gas producers associated with the
former TransCanada pool business. The transaction is one of several which should
allow Mirant to exit the majority of its Canadian natural gas storage,
transportation, portfolios of trading transactions and aggregator services
contracts and reduce its collateral obligations by over $200 million.
In May 2003, Mirant announced that it had entered an agreement to sell all
but one half of one percent of its 50% ownership interest in the 238 MW
Birchwood generating plant located near Fredricksburg, Virginia for
approximately $71 million.
Commencement of Operation
In May 2003, Mirant began commercial operation of its 533 MW Apex gas-fired
generating plant located north of Las Vegas, Nevada.
In June 2003, Mirant began commercial operation of its 259 MW expansion of
the Sugar Creek gas-fired generating plant near Terre Haute, Indiana.
Minority Shareholder Put Option
In May 2003, Mirant Asia-Pacific Limited's subsidiary paid approximately
$30 million to acquire an additional 4.26% ownership interest in the Pagbilao
project located in the Philippines increasing Mirant's ownership interest in the
Pagbilao project from 91.48% to 95.74%. The remaining minority interest subject
to the put agreement is 4.26%.
Long-Term Agreements
In March 2003, Mirant entered into a long-term agreement to provide
approximately 260 MW of wholesale electricity to Unitil Energy Systems, Inc.
which will resell the electricity to its New Hampshire customers. Under this
agreement, Mirant will also assume eight contracts for electric generation. This
agreement was approved by the New Hampshire Public Commission on March 14, 2003.
In April 2003, the Public Utilities Commission of Nevada approved three
long-term power contracts with Mirant and Nevada Power Company. Under the
contracts, which extend to April 2008, Mirant will provide 325 MW of capacity
and electricity to Nevada Power Company.
Jamaica Public Service Company - Credit Facilities
In March 2003, Jamaica Public Service Company ("JPSCO"), in which Mirant
has an 80% ownership interest, entered into a $30 million 7 year amortizing
credit facility with RBTT Merchant Bank Limited, Trinidad. In May 2003, JPSCO
entered into a $45 million 11.5 year amortizing credit facility with
International Finance Corporation (IFC). Amortization for this facility begins
in 2007. Both loans were used to finance the Bogue construction project and are
non-recourse to Mirant Corporation. The borrower has agreed to a number of
standard covenants, including (i) restrictions on change of control; (ii)
restrictions on the issuance or purchase of borrower's shares; (iii) limitations
on transactions with affiliates; (iv) limitations on the incurrence of new debt
and; (v) limitations on dividends.
Extension on Loan Waiver
In May 2003, Mirant's bank lenders, including lenders party to the Mirant
Americas Development turbine facility, extended the original waiver agreement
granted on April 18, 2003 to July 14, 2003. The waiver as extended also includes
a provision that limits the future use of letters of credit to existing
beneficiaries in amounts not to exceed current levels.
Western Rate Payer Litigation
On April 28, 2003, a purported class action suit, Egger et al. v. Dynegy,
Inc. et al., was filed in the Superior Court for the County of San Diego,
California, against various owners of electric generation facilities in
California and marketers of electricity and natural gas, including Mirant and
various of its subsidiaries, on behalf of all persons who purchased electricity
in Oregon, Washington, Utah, Nevada, Idaho, New Mexico, Arizona and Montana from
January 1, 1999. The plaintiffs allege that defendants engaged in unlawful,
unfair, and deceptive practices in the California and Western wholesale
electricity markets, including withholding energy from the market to create
artificial shortages, creating artificial congestion over transmission lines,
selling electricity bought in California to out of state affiliates to create
artificial shortages and then selling the electricity back into the state at
higher prices. The plaintiffs contend that the defendants conspired among
themselves and with subsidiaries of Enron Corporation to withhold electricity
from the PX and CAISO markets and to manipulate the price of electricity sold at
wholesale in the California and Western markets. The defendants' unlawful
manipulation of the wholesale energy market, the plaintiff alleges, resulted in
supply shortages and skyrocketing energy prices in the western United States,
which in turn caused drastic rate increases for retail consumers. The plaintiffs
assert claims under California's antitrust statute and its Unfair Competition
Act. The plaintiffs contend that the defendants alleged wrongful conduct has
caused damages in excess of one billion dollars and seek treble damages,
injunctive relief, restitution, and an accounting of the wholesale energy
transactions entered into by the defendants from 1998.
Edison Mission Energy Litigation
In connection with the litigation discussed in note 15 of Mirant's 2002
Annual Report on Form 10-K concerning two subsidiaries of Edison International
(collectively "EME") that have filed a law suit against Mirant as a result of
the non-completion of the sale of EcoElectrica Holdings Ltd., on April 29, 2003,
EME amended its complaint to assert additional claims for fraudulent
misrepresentation and concealment, conspiracy to defraud, and negligent
misrepresentation. The Company continues to believe that it did not breach its
agreement with EME.
SIGNATURE
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.
Date: June 2, 2003 MIRANT CORPORATION
By: /s/ Dan Streek
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Dan Streek
Vice President and
Controller
(Principal Accounting Officer)