Xcel Energy 2008 Annual Report Download - page 109

NSP-Wisconsin
On Jan. 14, 2009, NSP-Wisconsin announced a tender for and repurchase of any and all principal amount and accrued
interest of the remaining 7.375 percent $65 million first mortgage bonds due Dec. 1, 2026 with the tender period
running through March 1, 2009. The net costs are anticipated to be $3.0 million related to this repayment of debt and
will be recorded in the first quarter of 2009. The debt repayment will be funded by existing cash resources.
On Sept. 10, 2008, NSP-Wisconsin issued $200 million of 6.375 percent first mortgage bonds, series due Sept. 1,
2038. NSP-Wisconsin added the net proceeds from the sale of the first mortgage bonds to its general funds and applied
a portion of such net proceeds to fund the payment at maturity of $80 million of 7.64 percent senior notes due
Oct. 1, 2008. The balance of the net proceeds was used for the repayment of short-term debt (including notes payable
to affiliates) and for general corporate purposes.
PSCo
On Aug. 13, 2008, PSCo issued $300 million of 5.80 percent first mortgage bonds, series due Aug. 1, 2018 and
$300 million of 6.50 percent first mortgage bonds, series due Aug. 1, 2038. PSCo added the net proceeds from the sale
of the first mortgage bonds to its general funds and applied a portion of such net proceeds to fund the payment at
maturity of $300 million of 4.375 percent first mortgage bonds due Oct. 1, 2008.
On Aug. 15, 2007, PSCo issued $350 million of 6.25 percent first mortgage bonds, series due Sept. 1, 2037. PSCo
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, including commercial paper incurred to fund the payment at maturity
of $100 million of 7.11 percent secured medium-term notes, which matured on March 5, 2007.
SPS
On Nov. 14, 2008, SPS issued $250 million of 8.75 percent senior notes, series due 2018. The senior notes are
redeemable by SPS upon 30 days notice with payment of a make-whole premium. The proceeds from this offering were
used to repay short-term debt.
Convertible Senior Notes
Xcel Energy’s 2007 and 2008 series convertible senior notes included provisions for conversion into shares of Xcel
Energy common stock at a conversion price of $12.33 per share. Conversion was at the option of the holder at any
time prior to maturity. In addition, Xcel Energy was required to make additional payments of interest, referred to as
protection payments, on the notes in an amount equal to any portion of regular quarterly per share dividends on
common stock that exceeded 18.75 cents per share that would have been payable to the holders of the notes if such
holders had converted their notes on the record date for such dividend. On May 21, 2008, the Board of Directors of
Xcel Energy voted to raise the quarterly dividend on its common stock from 23.00 cents per share to 23.75 cents per
share. Consequently, as of Dec. 31, 2008 and 2007, a total of $0.7 million and $2.1 million in additional interest
expense has been recorded, respectively. During the fourth quarter of 2008, $57.5 million of remaining Xcel convertible
notes due Nov. 21, 2008, were converted to common stock. During the second and fourth quarter of 2007,
approximately $126 million and $104 million, respectively, of Xcel convertible notes due Nov. 21, 2007, were
converted to common stock.
Debt Exchange
On March 30, 2007, Xcel Energy settled an exchange offer for up to $350 million aggregate principal amount of its
7 percent Senior Notes, Series due 2010 (the Old Notes). Xcel Energy accepted approximately $241.4 million aggregate
principal amount of its Old Notes in exchange for approximately $254.0 million aggregate principal amount of a new
series of 5.613 percent senior notes due April 1, 2017 (the New Notes). The $12.6 million non-cash increase in the
aggregate principal amount was a result of financing the premium associated with the exchange. In addition, Xcel
Energy paid the following amounts in cash: (i) approximately $4.8 million to certain investors as an early participation
payment for Old Notes validly tendered prior to March 13, 2007 and accepted for exchange; (ii) approximately
$57,000 in cash in lieu of New Notes; and (iii) accrued and unpaid interest to, but not including, the settlement date
with respect to the Old Notes accepted for exchange.
The New Notes were issued only to holders of Old Notes that certified certain matters to Xcel Energy, including their
status as either ‘‘qualified institutional buyers,’’ as that term is defined in Rule 144A under the Securities Act of 1933,
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