8-KMaterial AgreementsOther EventsExhibits & Filings

CONSOLIDATED EDISON INC 8-K Report, Material Agreement (Apr 6, 2020)

Filed April 6, 2020For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) announced on April 6, 2020, the execution of a Supplemental Credit Agreement providing access to up to $750 million in revolving credit, with an option to extend into a 270-day term loan. This facility is intended to bolster liquidity and support general corporate purposes. The credit line allows for an additional $250 million increase under certain conditions, and borrowings will generally be subject to variable interest rates tied to Con Edison's credit ratings. This move aims to ensure financial flexibility, particularly given the uncertainties surrounding the COVID-19 pandemic. While Con Edison stated that COVID-19 has not yet had a material impact, the company acknowledges the unpredictable nature of its future effects on liquidity, financial condition, and operations. The credit agreement includes standard covenants, such as a debt-to-capital ratio not exceeding 0.65 to 1, and events of default that could trigger immediate repayment obligations.

Key Highlights

  • 1Secured a new 90-day revolving credit facility totaling $750 million.
  • 2Option to convert outstanding loans into a 270-day term loan.
  • 3Potential for an additional $250 million credit increase.
  • 4Purpose of the credit facility is to provide additional liquidity and for general corporate purposes.
  • 5Borrowings will generally carry variable interest rates tied to Con Edison's credit ratings.
  • 6Key covenants include maintaining a consolidated debt to consolidated total capital ratio not exceeding 0.65 to 1.
  • 7Company acknowledges COVID-19 risk but states no material impact to date.

Frequently Asked Questions

The primary purpose of the Supplemental Credit Agreement is to provide Consolidated Edison, Inc. with additional liquidity and to support its general corporate purposes, enhancing its financial flexibility.

Con Edison can access up to $750 million in revolving credit. There is also an option to increase this aggregate principal amount by up to $250 million under certain conditions.

The credit facility has a 90-day commitment period, after which loans can be converted to a 270-day term loan. Commitments can be terminated by lenders upon a change of control or if an Event of Default occurs. Key covenants include maintaining a specific debt-to-capital ratio and restrictions on liens. Borrowings are also subject to mandatory termination and prepayment with proceeds from debt or equity issuances.

As of the filing date (April 6, 2020), Con Edison stated that COVID-19 had not had a material impact on the company. However, the company acknowledges that the future impact on its liquidity, financial condition, and results of operations is uncertain and cannot be predicted.