Xcel Energy 2012 Annual Report Download - page 103

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Amended Credit Agreements — In July 2012, NSP-Minnesota, NSP-Wisconsin, PSCo, SPS and Xcel Energy Inc. entered into
amended five-year credit agreements with a syndicate of banks, replacing their previous four-year credit agreements. The
amended credit agreements have substantially the same terms and conditions as the prior credit agreements with an improvement
in pricing and an extension of maturity from March 2015 to July 2017. The Eurodollar borrowing margins on these lines of credit
were reduced from a range of 100 to 200 basis points per year, to a range of 87.5 to 175 basis points per year based on applicable
long-term credit ratings. The commitment fees, calculated on the unused portion of the lines of credit, were reduced from a range
of 10 to 35 basis points per year, to a range of 7.5 to 27.5 basis points per year, also based on applicable long-term credit ratings.
NSP-Minnesota, PSCo, SPS, and Xcel Energy Inc. each have the right to request an extension of the revolving termination date
for two additional one-year periods. NSP-Wisconsin has the right to request an extension of the revolving termination date for an
additional one-year period. All extension requests are subject to majority bank group approval.
Features of the credit facilities include:
• Xcel Energy Inc. may increase its credit facility by up to $200 million, NSP-Minnesota and PSCo may each increase
their credit facilities by $100 million and SPS may increase its credit facility by $50 million. The NSP-Wisconsin credit
facility cannot be increased.
• Each credit facility has a financial covenant requiring that the debt-to-total capitalization ratio of each entity be less than
or equal to 65 percent. Each entity was in compliance at Dec. 31, 2012 and 2011, respectively, as evidenced by the table
below:
Debt-to-Total Capitalization Ratio
2012 2011
Xcel Energy ................................
.......................
56%
55
%
NSP-Wisconsin ................................
....................
50
50
NSP-Minnesota ................................
....................
48
48
SPS ................................
...............................
49
48
PSCo................................
..............................
45
45
If Xcel Energy Inc. or any of its utility subsidiaries do not comply with the covenant, an event of default may be declared, and if
not remedied, any outstanding amounts due under the facility can be declared due by the lender.
• The Xcel Energy Inc. credit facility has a cross-default provision that provides Xcel Energy Inc. will be in default on its
borrowings under the facility if it or any of its subsidiaries, except NSP-Wisconsin as long as its total assets do not
comprise more than 15 percent of Xcel Energy’s consolidated total assets, default on certain indebtedness in an
aggregate principal amount exceeding $75 million.
Long-Term Borrowings and Other Financing Instruments
Generally, all real and personal property of NSP-Minnesota and NSP-Wisconsin and all real and personal property used in or in
connection with the electric utility business of PSCo and SPS are subject to the liens of their first mortgage indentures. Debt
premiums, discounts and expenses are amortized over the life of the related debt. The premiums, discounts and expenses
associated with refinanced debt are deferred and amortized over the life of the related new issuance, in accordance with regulatory
guidelines.
Maturities of long-term debt are as follows:
(Millions of Dollars)
2013
..............................
$ 258
2014
..............................
281
2015
..............................
256
2016
..............................
206
2017
..............................
388
Xcel Energy has entered into a Replacement Capital Covenant (RCC). Under the terms of the RCC, Xcel Energy has agreed not
to redeem or repurchase all or part of the $400 million of 7.60 percent junior subordinated notes due 2068 (Junior Subordinated
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 Subordinated Notes at the time of redemption or repurchase.