Business Context and Reporting Period
Company: Black Hills Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: July 19, 2021
Event: Entry into a Material Definitive Agreement regarding a credit facility.
Key Financial Metrics and Credit Facility Details
- Facility Name: Fourth Amended and Restated Credit Agreement (Restated Revolver).
- Term Extension: Extended from July 30, 2023, to July 19, 2026, with two one-year extension options subject to lender consent.
- Capacity: Current availability is $750 million, with an accordion feature allowing an increase to $1 billion.
- Cost of Borrowing: Spread of 112.5 basis points over LIBOR for borrowings; 17.5 basis points over LIBOR for unused commitments.
- Outstanding Balance: $0 borrowings outstanding as of July 19, 2021.
- Letters of Credit: $13.6 million issued under the facility.
Material Changes Versus Prior Period
The primary material change is the extension of the credit facility maturity date by approximately three years. The borrowing costs and general terms remain materially similar to the previous agreement, with no change to the interest rate spreads.
Guidance, Outlook, and Risks
Management Commentary: The filing indicates the company has secured long-term liquidity flexibility through the term extension and the accordion feature. The cost of borrowing is tied to the company's senior unsecured long-term debt ratings and may change over time.
Risks/Contingencies: The two one-year extension options and the accordion feature to increase capacity are subject to the consent of lenders and the administrative agent.
Key Facts for Investor Verification
- Verify the company's current senior unsecured long-term debt rating to confirm the applicable interest rate spread.
- Monitor the utilization of the $750 million revolver and the $13.6 million in letters of credit.
- Track any future announcements regarding the exercise of the accordion feature to increase capacity to $1 billion.
- Confirm the status of lender consent for any potential one-year term extensions beyond July 2026.