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Idacorp Inc.
12/11/2023 | Press release | Distributed by Public on 12/11/2023 15:07
Material Agreement - Form 8-K
Item 1.01 Entry Into a Material Definitive Agreement.
IDACORP Credit Facility
On December 8, 2023, IDACORP, Inc. ("IDACORP") entered into a Credit Agreement (the "IDACORP Facility") with Wells Fargo Bank, National Association, as administrative agent, swingline lender, and LC issuer; JPMorgan Chase Bank, N.A., as syndication agent and LC issuer; and the other financial institutions party thereto, as lenders (collectively, the "Lending Parties"). The IDACORP Facility replaces IDACORP's existing Credit Agreement, dated November 6, 2015, as amended from time to time, among IDACORP and certain of the Lending Parties, which was filed as Exhibit 10.1 to IDACORP's Form 8-K filed on November 9, 2015 (the "2015 8-K").
The IDACORP Facility is a $100 million revolving line of credit that matures on December 8, 2028. The IDACORP Facility, which will be used for general corporate purposes (including commercial paper backup), provides for the issuance of loans not to exceed the aggregate principal amount outstanding at any one time of $100 million, including swingline loans not to exceed an aggregate principal amount outstanding at any time of $10 million and letters of credit in an aggregate principal amount at any time outstanding not to exceed $50 million. IDACORP has the right to request an increase in the aggregate principal amount of the IDACORP Facility to $150 million and to request up to two one-year extensions of the credit agreement, in each case subject to certain conditions.
Idaho Power Credit Facility
On December 8, 2023, Idaho Power Company ("IPC") entered into a Credit Agreement (the "IPC Facility" and together with the IDACORP Facility, the "Facilities") with the Lending Parties. The IPC Facility replaces IPC's existing Credit Agreement, dated November 6, 2015, as amended from time to time, among IPC and certain of the Lending Parties, which was filed as Exhibit 10.2 to the 2015 8-K.
The IPC Facility is a $400 million revolving line of credit that matures on December 8, 2028. The IPC Facility, which will be used for general corporate purposes (including commercial paper backup), provides for the issuance of loans and standby letters of credit not to exceed the aggregate principal amount outstanding at any one time of $400 million, including swingline loans not to exceed an aggregate principal amount outstanding at any time of $50 million and letters of credit in an aggregate principal amount at any time outstanding not to exceed $50 million. IPC has the right to request an increase in the aggregate principal amount of the IPC Facility to $600 million and to request up to two one-year extensions of the credit agreement, in each case subject to certain conditions.
Summary of Additional Terms of the Facilities
The IDACORP Facility and the IPC Facility have similar terms and conditions. The interest rates for any borrowings under the Facilities are based on either (1) a floating rate that is equal to the highest of the prime rate, federal funds rate plus 0.5 percent, Adjusted Term SOFR plus 1.0 percent and 1.0 percent or (2) the Adjusted Term SOFR, plus, in each case, an applicable margin, provided that the Adjusted Term SOFR will not be less than 0.0 percent. The applicable margin is based on IDACORP's or IPC's, as applicable, senior unsecured long-term indebtedness credit rating by Moody's Investors Service, Inc., Standard and Poor's Ratings Services, and Fitch Ratings, Inc., as set forth on a schedule to the Facilities. The facility fee for each of the Facilities is also determined by those ratings and is set forth on a schedule to the Facilities.
The events of default under the Facilities include, without limitation, non-payment of principal, interest, or fees; materially false representations or warranties; breach of covenants; bankruptcy or insolvency events; condemnation of property; cross-default to certain other indebtedness; failure to pay certain judgments; change of control; failure of IDACORP to own free and clear of liens the voting stock of IPC; the occurrence of specified events or the incurring of specified liabilities relating to benefit plans; and the incurring of certain environmental liabilities, subject, in certain instances, to cure periods.
Upon any event of default relating to the voluntary or involuntary bankruptcy of IDACORP or IPC or the appointment of a receiver, the obligations of the lenders to make loans under the applicable facility and to issue letters of credit will automatically terminate and all unpaid obligations will become due and payable. Upon any other event of default, the lenders holding greater than 50 percent of the outstanding loans or greater than 50 percent of the aggregate commitments ("Required Lenders"), or the administrative agent with the consent of the Required Lenders, may terminate or suspend the obligations of the lenders to make loans under the applicable facility and to issue letters of credit under the facility and/or declare the obligations to be due and payable. During an event of default under the Facilities, the lenders may, at their option, increase the applicable interest rates then in effect and the letter of credit fee by 2.0 percent per annum.
The Facilities each contain a covenant requiring IDACORP and IPC to maintain a leverage ratio of consolidated indebtedness to consolidated total capitalization (each as defined in the Facilities) equal to or less than 0.65 as of the end of each fiscal quarter. The Facilities contain additional covenants related to, among other items, prohibitions against specified forms of mergers, acquisitions, and investments; restrictions on the creation of certain liens, subject to exceptions, including the lien of IPC's first mortgage; and prohibitions on entering into any agreement restricting the ability of subsidiaries to declare or pay dividends, subject to certain exceptions.
Copies of the IDACORP Facility and IPC Facility are filed as Exhibit 10.1 and 10.2, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 1.01. The description above is a summary of the Facilities, does not provide a complete description of the Facilities, and is qualified in its entirety by the complete text of the Facilities themselves.