Xcel Energy eliminates cross-default provision in its two bank lines

By Sara Rosenberg

New York, Aug. 5 - Xcel Energy eliminated a cross-default provision in its two bank lines that constrained the company's ability to access capital markets due to NRG's financial condition. As part of the agreement with lenders, the board of directors will review the company's dividend policy, however, no decision has been made as of yet.

Bank of New York is the agent for the facilities.

"We're delighted that we were able reach these agreements," said Wayne Brunetti, chairman, president and chief executive officer, in a company press release. "This was a critical step for the company and gives us the added financial flexibility we need."

"This agreement should make it clear that we have the needed financial and legal separation between NRG and the Xcel Energy holding company," Brunetti added.

Xcel has approximately $200 million remaining on its two $400 million credit facilities. One of the loans expires in Nov. 2002 and one expires in Nov. 2005. The company renegotiated its $800 million credit facilities when it appeared that NRG would be unable to meet cash collateral demands under the circumstances of a rating downgrade below the investment grade level. Recently, NRG was downgraded by all three rating agencies to non-investment grade status.

Xcel Energy is a Minneapolis, Minn. electric and natural gas company.

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