Pinnacle West and unit get new five-year revolving credit facilities

By Marisa Wong

Madison, Wis., Nov. 4 - Pinnacle West Capital Corp. entered into an up to $200 million revolving credit facility due Nov. 4, 2016 on Friday, according to an 8-K filing with the Securities and Exchange Commission. The new facility replaces Pinnacle West's $200 million revolving credit facility due Feb. 12, 2013, which was terminated on Friday.

Borrowings under the facility will bear interest based on the company's senior unsecured debt ratings or, if no senior unsecured debt is outstanding at the time of determination, the rating of the company's bank credit facilities.

The facility includes customary covenants, including requirements that Pinnacle West maintain ownership of a certain percentage of the outstanding capital stock of its subsidiary, Arizona Public Service Co., maintain a consolidated debt-to-capitalization ratio at or below a prescribed level and comply with certain lien restrictions.

The facility also includes customary events of default, including a cross default provision and a change of control provision.

Pinnacle West's new facility will be used for general corporate purposes and may be used as a standby facility to support commercial paper issuances and for letters of credit.

According to the 8-K filing, subsidiary Arizona Public Service also entered into a revolving credit facility on Friday. Under the new facility, Arizona Public Service may borrow up to $500 million. The company's prior $500 million revolver due Feb. 12, 2013 was terminated on Friday as well.

The new facility is due Nov. 4, 2016.

Borrowings will bear interest based on Arizona Public Service's senior unsecured debt ratings.

The Arizona Public Service facility includes customary covenants and customary events of default similar to those of the parent company facility.

Arizona Public Service will use its new facility for general corporate purposes, including as a standby facility for issuing commercial paper and for letters of credit.

Barclays Bank plc is the agent and an issuing bank for both facilities. Royal Bank of Scotland plc and Wells Fargo Bank, NA are co-syndication agents and issuing banks. Bank of America, NA and Credit Suisse AG, Cayman Islands Branch are co-documentation agents.

Pinnacle West is a utility based in Phoenix. Arizona Public Service is also based in Phoenix.

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