Vectren 2013 Annual Report Download - page 101

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In March and April, 2013, the Company notified holders of six issues of SIGECO's tax exempt long-term debt totaling $110.9
million with interest rates ranging from 4.50 percent to 5.45 percent, and with maturity dates from 2020 to 2041of its intent to call
this debt. The call options were exercised at par in April and May, 2013.
Letters of Credit Supporting Long-Term Debt
As of December 31, 2013, Utility Holdings has letters of credit outstanding in support of two SIGECO tax exempt adjustable rate
first mortgage bonds totaling $41.7 million. In the unlikely event the letters of credit were called, the Company could settle with
the financial institutions supporting these letters of credit with general assets or by drawing from its credit facility that expires in
September 2016. Due to the long-term nature of the credit agreement, such debt is classified as long-term at December 31,
2013.
Future Long-Term Debt Sinking Fund Requirements and Maturities
The annual sinking fund requirement of SIGECO's first mortgage bonds is 1 percent of the greatest amount of bonds
outstanding under the Mortgage Indenture. This requirement may be satisfied by certification to the Trustee of unfunded
property additions in the prescribed amount as provided in the Mortgage Indenture. SIGECO intends to meet the 2013 sinking
fund requirement by this means and, accordingly, the sinking fund requirement for 2013 is excluded from Current liabilities in the
Consolidated Balance Sheets. At December 31, 2013, $1.2 billion of SIGECO's utility plant remained unfunded under
SIGECO's Mortgage Indenture. SIGECO’s gross utility plant balance subject to the Mortgage Indenture approximated $2.9
billion at December 31, 2013.
Consolidated maturities of long-term debt during the five years following 2013 (in millions) are $30.0 in 2014, $279.8 in 2015,
$173.0 in 2016, $75.0 in 2017, $100.0 in 2018, and $1,149.3 thereafter.
Debt Guarantees
Vectren Corporation guarantees Vectren Capital’s long-term debt, including current maturities, and short-term debt, which
totaled $550 million and $40 million, respectively, at December 31, 2013. Utility Holdings’ currently outstanding long-term and
short-term debt is jointly and severally guaranteed by Indiana Gas, SIGECO, and VEDO. Utility Holdings’ long-term debt and
short-term debt outstanding at December 31, 2013, totaled $875 million and $29 million, respectively.
Covenants
Both long-term and short-term borrowing arrangements contain customary default provisions; restrictions on liens, sale-
leaseback transactions, mergers or consolidations, and sales of assets; and restrictions on leverage, among other
restrictions. Multiple debt agreements contain a covenant that the ratio of consolidated total debt to consolidated total
capitalization will not exceed 65 percent. As of December 31, 2013, the Company was in compliance with all financial
covenants.
Short-Term Borrowings
At December 31, 2013, the Company has $600 million of short-term borrowing capacity, including $350 million for the Utility
Group and $250 million for the wholly owned Nonutility Group and corporate operations. As reduced by borrowings currently
outstanding, approximately $321 million was available for the Utility Group operations and approximately $210 million was
available for the wholly owned Nonutility Group and corporate operations. Both Vectren Capital’s and Utility Holdings’ short-term
credit facilities were renewed in November 2011 and are available through September 2016. The maximum limit of both
facilities remained unchanged. These facilities are used to supplement working capital needs and also to fund capital
investments and debt redemptions until financed on a long-term basis.