8-KMaterial AgreementsFinancial EventsExhibits & Filings

DTE ENERGY CO 8-K Report, Material Agreement (Aug 26, 2010)

Filed August 26, 2010For Securities:DTEDTKDTBDTGDTW

Summary

This Form 8-K filing by DTE Energy Company (DTE) on August 26, 2010, reports on the company and its subsidiary, Michigan Consolidated Gas Company (MichCon), entering into new and amended credit agreements. These agreements establish new revolving credit facilities and replace existing ones. Specifically, DTE Energy secured a new three-year unsecured revolving credit facility with an aggregate availability of approximately $562 million and amended and restated its two-year unsecured revolving credit facility for approximately $538 million. MichCon also entered into new and amended credit facilities totaling $175 million and $250 million, respectively. These new facilities are intended to support commercial paper borrowings and have a debt to capitalization ratio covenant of no more than 0.65 to 1, expiring in August 2013 and August 2012, respectively.

Key Highlights

  • 1DTE Energy and its subsidiary MichCon have entered into new and amended unsecured revolving credit agreements.
  • 2DTE Energy secured a new three-year credit facility of approximately $562 million, expiring in August 2013.
  • 3DTE Energy also amended and restated its two-year credit facility for approximately $538 million, expiring in August 2012.
  • 4MichCon secured a new three-year credit facility of $175 million and amended and restated its two-year facility for $250 million.
  • 5The new credit facilities are intended to support commercial paper borrowings.
  • 6A key covenant across these agreements requires the maintenance of a debt to capitalization ratio of no more than 0.65 to 1.
  • 7Existing five-year credit agreements were terminated and replaced by these new facilities.

Frequently Asked Questions

The primary purpose of these new and amended credit agreements is to provide DTE Energy and its subsidiary MichCon with access to revolving credit facilities that can support their commercial paper borrowings and general corporate needs. The agreements also provide a framework for managing their debt levels through a debt-to-capitalization ratio covenant.

The total aggregate availability under the new and amended facilities for DTE Energy is approximately $562 million (three-year facility) and $538 million (two-year facility), totaling $1.1 billion. For MichCon, the total is $175 million (three-year facility) and $250 million (two-year facility), totaling $425 million. The combined total availability is $1.525 billion.

Yes, a key financial covenant requires DTE Energy and MichCon to maintain a debt to capitalization ratio of no more than 0.65 to 1. This indicates a commitment to a prudent leverage level.

The previous five-year credit agreements for both DTE Energy and MichCon, dated October 17, 2005, were terminated effective August 20, 2010. They were replaced by the new three-year credit facilities and the amended and restated two-year credit facilities announced in this filing.