SEC Company Response from Duke Energy CORP (DUK, DUKB, DUK-PA) (CIK 0001326160) (DUK) — Aug 23, 2005
Duke Energy CORP (DUK, DUKB, DUK-PA) (CIK 0001326160)
Date: Aug. 23, 2005 · CIK: 0001326160 · Accession: 0001104659-05-040926
AI Filing Summary & Sentiment
File numbers found in text: 333-126318
Referenced dates: July 29, 2005
Letter
VIA EDGAR AND HAND DELIVERY Division of Corporation Finance Re: Duke Energy Holding Corp. Registration Statement on Form S-4 Filed July 1, 2005 File No. 333-126318
Dear Mr. Owings:
On behalf of Duke Energy Holding Corp. (the “Company”), attached hereto please find Exhibit A to the Company’s August 22, 2005 response to Comment 23 of your comment letter dated July 29, 2005 relating to the registration statement on Form S-4 filed by the Company on July 1, 2005 (Commission File No. 333-126318) in connection with the merger of Duke Energy Corporation and Cinergy Corp.
The attached was erroneously omitted from both the EDGAR filing and the courtesy copy subsequently hand delivered to the Staff. This letter and the attached Exhibit A are being submitted through EDGAR as sole correspondence and contemporaneously hand delivered to the Staff.
Please do not hesitate to call me at (212) 735-2136 or Jeremy London at (202) 371-7535 with any questions regarding the foregoing.
Very truly yours,
Sheldon S. Adler, Esq.
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CORRESP
1
filename1.htm
[Letterhead of Skadden,
Arps, Slate, Meagher & Flom LLP]
August 23, 2005
VIA EDGAR AND HAND
DELIVERY
H. Christopher Owings
Assistant Director
Division of Corporation Finance
U.S. Securities and
Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549-0303
Re: Duke Energy Holding Corp.
Registration Statement on Form S-4
Filed July 1, 2005
File No. 333-126318
Dear Mr. Owings:
On behalf of Duke Energy Holding Corp. (the
“Company”), attached hereto please find Exhibit A to the Company’s August 22,
2005 response to Comment 23 of your comment letter dated July 29, 2005 relating
to the registration statement on Form S-4 filed by the Company on July 1, 2005
(Commission File No. 333-126318) in connection with the merger of Duke Energy
Corporation and Cinergy Corp.
The attached was erroneously omitted from both the
EDGAR filing and the courtesy copy subsequently hand delivered to the
Staff. This letter and the attached
Exhibit A are being submitted through EDGAR as sole correspondence and
contemporaneously hand delivered to the Staff.
Please
do not hesitate to call me at (212)
735-2136 or Jeremy London at (202) 371-7535 with any questions regarding
the foregoing.
Very truly yours,
Sheldon S. Adler, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
cc: B.
Keith Trent, Esq.
Group Vice
President — General Counsel and Secretary
Duke Energy Corporation
Peter A. Atkins, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Marc E. Manly, Esq.
Executive Vice President and Chief Legal Officer
Cinergy Corp.
Steven A. Rosenblum, Esq.
Wachtell, Lipton, Rosen & Katz
Stephanie J. Seligman, Esq.
Wachtell, Lipton, Rosen & Katz
Exhibit
A
Duke Energy Holding Corp.
Valuation of Cinergy Stock Compensation
Assumed
as of March 31, 2005
The
following table displays the components of the value of Cinergy stock
compensation assumed of $138 million:
Award Type
Amount
(in millions)
Stock Options (pp. 2-3)
$
79
Restricted Shares (p. 3)
7
Performance Awards (p. 4)
52
Total
$
138
The pages that follow contain the supporting calculations
for the amount shown above.
1
Stock Options
Option Grant
Date
Adj.
Strike
Price
Adj.
Shares
Outstanding
70% of
Remaining
Term as of
3/31/2005
Volatility
Dividend
Yield
Risk-Free
Rate
Duke Stock
FMV
Current
Black-Scholes
Value/Share
Value of
Outstanding
Stock Options
1/1/1997
$
21.474
275,184
1.229
33.00
%
4.71
%
3.32
%
$
28.75
$
7.66
$
2,107,909.44
1/29/1997
$
22.115
10,140
1.283
33.00
%
4.71
%
3.42
%
$
28.75
$
7.28
$
73,819.20
4/16/1997
$
21.715
4,992
1.431
33.00
%
4.71
%
3.42
%
$
28.75
$
7.62
$
38,039.04
12/17/1997
$
23.017
11,076
1.900
33.00
%
4.71
%
3.60
%
$
28.75
$
7.13
$
78,971.88
1/1/1998
$
24.740
369,238
1.929
33.00
%
4.71
%
3.60
%
$
28.75
$
6.25
$
2,307,737.25
1/27/1998
$
23.117
2,652
1.979
33.00
%
4.71
%
3.60
%
$
28.75
$
7.12
$
18,882.24
3/24/1998
$
23.638
748,800
2.086
33.00
%
4.71
%
3.69
%
$
28.75
$
6.92
$
5,181,696.00
4/6/1998
$
23.518
37,908
2.111
33.00
%
4.71
%
3.69
%
$
28.75
$
6.99
$
264,976.92
12/15/1998
$
21.995
12,168
2.596
33.00
%
4.71
%
3.83
%
$
28.75
$
8.03
$
97,709.04
1/1/1999
$
21.875
398,745
2.628
33.00
%
4.71
%
3.83
%
$
28.75
$
8.10
$
3,229,837.42
12/9/1999
$
15.304
37,867
3.284
33.00
%
4.71
%
3.98
%
$
28.75
$
12.11
$
458,574.70
12/14/1999
$
15.264
729,690
3.293
33.00
%
4.71
%
3.98
%
$
28.75
$
12.14
$
8,858,436.60
1/3/2000
$
15.164
17,285
3.332
33.00
%
4.71
%
3.98
%
$
28.75
$
12.19
$
210,701.71
1/19/2000
$
15.625
314,613
3.362
33.00
%
4.71
%
3.98
%
$
28.75
$
11.88
$
3,737,602.44
7/18/2000
$
17.488
22,932
3.709
33.00
%
4.71
%
4.02
%
$
28.75
$
10.70
$
245,372.40
8/21/2000
$
19.071
5,616
3.775
33.00
%
4.71
%
4.05
%
$
28.75
$
9.83
$
55,205.28
11/20/2000
$
20.533
1,182
3.949
33.00
%
4.71
%
4.05
%
$
28.75
$
9.11
$
10,772.39
12/13/2000
$
20.753
2,184
3.993
33.00
%
4.71
%
4.05
%
$
28.75
$
9.01
$
19,677.84
1/1/2001
$
22.496
651,671
4.029
33.00
%
4.71
%
4.08
%
$
28.75
$
8.25
$
5,376,288.06
1/16/2001
$
19.091
41,808
4.058
33.00
%
4.71
%
4.08
%
$
28.75
$
9.84
$
411,390.72
2/12/2001
$
20.481
350,220
4.110
33.00
%
4.71
%
4.08
%
$
28.75
$
9.16
$
3,208,015.20
2/27/2001
$
20.929
14,352
4.139
33.00
%
4.71
%
4.08
%
$
28.75
$
8.95
$
128,450.40
6/14/2001
$
20.865
2,340
4.344
33.00
%
4.71
%
4.10
%
$
28.75
$
9.01
$
21,083.40
10/15/2001
$
20.474
1,560
4.579
33.00
%
4.71
%
4.12
%
$
28.75
$
9.21
$
14,367.60
1/1/2002
$
21.561
858,796
4.729
33.00
%
4.71
%
4.12
%
$
28.75
$
8.75
$
7,514,461.50
6/1/2002
$
21.353
5,928
5.018
33.00
%
4.71
%
4.16
%
$
28.75
$
8.87
$
52,581.36
7/23/2002
$
17.712
178,776
5.118
33.00
%
4.71
%
4.16
%
$
28.75
$
10.49
$
1,875,360.24
12/4/2002
$
20.256
389,532
5.375
33.00
%
4.71
%
4.18
%
$
28.75
$
9.34
$
3,638,228.88
12/17/2002
$
21.353
48,360
5.400
33.00
%
4.71
%
4.18
%
$
28.75
$
8.90
$
430,404.00
1/1/2003
$
21.718
1,038,492
5.428
33.00
%
4.71
%
4.18
%
$
28.75
$
8.76
$
9,097,189.92
2/5/2003
$
20.340
32,604
5.496
33.00
%
4.71
%
4.18
%
$
28.75
$
9.30
$
303,217.20
2
Stock Options (cont’d)
Option Grant
Date
Adj.
Strike
Price
Adj.
Shares
Outstanding
70% of
Remaining
Term as of
3/31/2005
Volatility
Dividend
Yield
Risk-Free
Rate
Duke Stock
FMV
Current
Black-Scholes
Value/Share
Value of
Outstanding
Stock Options
7/22/2003
$
21.946
31,980
5.816
33.00
%
4.71
%
4.23
%
$
28.75
$
8.71
$
278,545.80
11/26/2003
$
23.413
221,832
6.059
33.00
%
4.71
%
4.25
%
$
28.75
$
8.22
$
1,823,459.04
12/19/2003
$
24.240
9,204
6.103
33.00
%
4.71
%
4.25
%
$
28.75
$
7.96
$
73,263.84
1/1/2004
$
24.837
1,068,132
6.128
33.00
%
4.71
%
4.25
%
$
28.75
$
7.77
$
8,299,385.64
8/1/2004
$
25.417
37,596
6.536
33.00
%
4.71
%
4.30
%
$
28.75
$
7.66
$
287,985.36
11/1/2004
$
25.266
26,208
6.713
33.00
%
4.71
%
4.30
%
$
28.75
$
7.72
$
202,325.76
1/1/2005
$
26.788
1,151,124
6.829
33.00
%
4.71
%
4.32
%
$
28.75
$
7.32
$
8,426,227.68
2/25/2005
$
26.038
29,952
6.935
33.00
%
4.71
%
4.32
%
$
28.75
$
7.53
$
225,538.56
Total:
$
78,683,691.95
Restricted Shares
Grant
Date
Duke
Stock
FMV
Adj.
Rest.
Shares
Outstanding
Value of
Outstanding
Rest. Shares
3/3/2003
$
28.75
80,576
$
2,316,547.35
7/22/2003
$
28.75
6,836
$
196,532.70
4/6/2004
$
28.75
74,492
$
2,141,632.35
1/1/2005
$
28.75
82,132
$
2,361,307.65
Total:
$
7,016,020.05
3
Performance Shares
Performance
Period
Cinergy
Stock
FMV
Target
Shares
Outstanding
Award
Payout @
Maximum
Dividends
Accrued Per Share
Through 3/31/05
Additional
Shares from
Dividends
Total
Perf. Shares
Outstanding
Value of
Outstanding
Perf. Shares
1/1/03 - 12/31/05
$40.54
411,193
822,386
$4.20
85,200
907,586
$36,793,536.44
1/1/04 - 12/31/06
$40.54
413,126
826,252
$2.36
48,100
874,352
$35,446,230.08
1/1/05 - 12/31/07
$40.54
392,366
784,732
$0.48
9,291
794,023
$32,189,692.42
Total:
$104,429,458.94
Assumed
Settlement:
Cash (50%
)
$52,214,729
Stock (50%
)
$52,214,729
4