Xcel Energy 2008 Annual Report Download - page 108

• At Dec. 31, 2007, Xcel Energy and its utility subsidiaries had no direct borrowings on these lines of credit;
however, the credit facilities were used to provide backup for $1.1 billion of commercial paper outstanding and
$19.0 million of letters of credit.
Long-Term Borrowings
All property of NSP-Minnesota and NSP-Wisconsin and the electric property of PSCo are subject to the liens of their
first mortgage indentures. In addition, certain SPS payments under its pollution-control obligations are pledged to
secure obligations of the Red River Authority of Texas.
Maturities of long-term debt are:
(Millions of Dollars)
2009 ..................................................... $ 558.8
2010 ..................................................... 541.6
2011 ..................................................... 51.5
2012 ..................................................... 1,066.4
2013 ..................................................... 256.1
Xcel Energy
On Jan. 16, 2008, Xcel Energy issued $400 million of 7.6 percent junior subordinated notes (Junior Notes) due 2068.
Due to certain features, rating agencies consider the Junior Notes to be hybrid debt instruments with a combination of
debt and equity characteristics. The Junior Notes are not redeemable by Xcel Energy prior to 2013 without payment of
a make-whole premium. The proceeds from this offering were used to repay short-term debt.
Interest payments on the Junior Notes may be deferred on one or more occasions for up to 10 consecutive years. If the
interest payments on the Junior Notes are deferred, Xcel Energy may not declare or pay any dividends or distributions,
or redeem, purchase, acquire, or make a liquidation payment on, any shares of its capital stock. Also during the deferral
period, Xcel Energy may not make any principal or interest payments on, or repay, purchase or redeem any of its debt
securities that are equal in right of payment with, or subordinated to, the Junior Notes. Xcel Energy also may not make
payments on any guarantees equal in right of payment with, or subordinated to, the Junior Notes.
In connection with the completion of this offering, Xcel Energy entered into a Replacement Capital Covenant (RCC)
for the benefit of persons that buy, hold, or sell a specified series of Xcel Energy long-term indebtedness ranking senior
to the Junior Notes. Initially, Xcel Energy’s 6.50 percent Senior Notes due July 1, 2036, was specified as such series of
long-term debt. Under the terms of the RCC, Xcel Energy agrees not to redeem or repurchase all or part of the Junior
Notes prior to 2038 unless qualifying securities are issued to non-affiliates in a replacement offering in the 180 days
prior to the redemption or repurchase date. Qualifying securities include those that have equity-like characteristics that
are the same as, or more equity-like than, the applicable characteristics of the Junior Notes at the time of redemption
or repurchase.
NSP-Minnesota
On March 18, 2008, NSP-Minnesota issued $500 million of 5.25 percent first mortgage bonds, series due March 1,
2018. NSP-Minnesota added the net proceeds from the sale of the first mortgage bonds to its general funds and
applied a portion of the proceeds to the repayment of commercial paper and borrowings under the utility money pool
arrangement.
On Aug. 1, 2007, NSP-Minnesota redeemed all of its outstanding 8.00 percent Notes, series due 2042, at a redemption
price equal to 100 percent of the principal amount of the notes ($25.00), plus accrued and unpaid interest on the
notes, if any, to the redemption date. Upon redemption, Xcel Energy recognized approximately $9.3 million in interest
expense due to unwinding a fair value interest rate derivative.
On June 26, 2007, NSP-Minnesota issued $350 million of 6.20 percent first mortgage bonds, series due July 1, 2037.
NSP-Minnesota added the net proceeds from the sale of the first mortgage bonds to its general funds and applied a
portion of the proceeds to the repayment of commercial paper.
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