ML24277A279
ML24277A279 | |
Person / Time | |
---|---|
Site: | Vallecitos Nuclear Center, 07000754, 07001113, 07200001, Vallecitos |
Issue date: | 05/01/2017 |
From: | Bornstein J General Electric Co |
To: | Office of Nuclear Reactor Regulation, Office of Nuclear Material Safety and Safeguards |
References | |
Download: ML24277A279 (1) | |
Text
GE 901 Main Avenue, 801 Norwalk, CT 06851 USA
May 1. 2017
U.S. Nuclear Regulatory Commission Director, Office of Nuclear Material Safety and Safeguards 11555 Rockville Pike Rockville, MD 20852
U.S. Nuclear Regulatory Commission Director, Office of Nuclear Reactor Regulation 11555 Rockville Pike Rockville, MD 20852
Subject:
General Electric Company Parent - Guarantee of Funds for Decommissioning: Updated Letter from Chief Financial Officer to Demonstrate Financial Assurance
I am the chief financial officer of the General Electric Company, 1 River Road, Schenectady,
N.Y. 12345, a corporation. This letter provides an update of this firm's financial assurance of
decommissioning funding for certain licenses, as specified in 10 CFR Parts 50, 70 and 72.
This firm guarantees, through the parent company guarantee submitted herewith to
demonstrate compliance under 10 CFR Parts 50, 70 and 72, the decommission*ing of certain facilities
owned or operated by subsidiaries of this firm. I hereby certify that General Electric Company is
currently a going concern and that it possesses a positive tangible net worth in the amount of
$2,255,000,000 and net worth in the amount of $79,887,000,000. The current cost estimates or
certified amounts for decommissioning, so guaranteed, are shown in Attachment 1.
The General Electric Company is required to file a Form 10-K with the U.S. Securities and
Exchange Commission for the latest fiscal year. The fiscal year of the General Electric Company ends
on December 31. The figures on the Financial Test II (Attachment 2) that are marked with an asterisk
are derived from the General Electric Company's independently audited, year-end financial U.S.NRC May 1. 2017 Page 2 of 2
statements and footnotes for the latest completed fiscal year, ended December 31. 2016. A copy of
the most recent financial statement is enclosed.
I hereby certify that the content of this letter and attachments are true and correct to the
best of my knowledge.
nstein enior Vice President and Chief Financial Officer May 1, 2017
Effective date of Parent Guarantee: May 1, 2017
Attachments:
- 1. List of Licensed Facilities
- 2. Financial Test II
- 3. Parent-Company Guarantee
- 4. Special Auditors' Report
- 5. General Electric Co. Financial Statements
CC:
Matthew G Louis, Vice President-Escrow Unit The Bank of New York Mellon 101 Barclay Street, 7 East New York, NY 10286 U.S. NRC May 1, 2017
Attachment 1 LIST OF LICENSED FACILITIES
Name of Facility License Location of Current Cost Number Facility Estimate
Global Nuclear Fuel-Americas. SNM-1097 3901 Castle Hayne Rd. $249,500,000 LLC Wilmington, NC 28401 Wilmington Fuel Manufacturing Facility
GE Reuter Stokes, Inc. SNM-1826 8499 Darrow Road $ 1.700,000 GE Reuter Stokes Facility Twinsburg, OH 44087 GE Hitachi Nuclear Energy DPR-1 Vallecitos Nuclear $11.100,000 Americas, LLC Center Vallecitos Nuclear 6 705 Vallecitos Rd.
Center (VBWR reactor) Sunol CA 94566 GE Hitachi Nuclear Energy R-33 Vallecitos Nuclear $ 5,000,000 Americas, LLC Center Vallecitos Nuclear 6705 Vallecitos Rd.
Center (NTR reactor) Sunol, CA 94566 GE Hitachi Nuclear Energy TR-1 Vallecitos Nuclear $ 21,400,000 Americas, LLC Center Vallecitos Nuclear 6705 Vallecitos Rd.
Center (GETR reactor) Sunol, CA 94566 GE Hitachi Nuclear Energy DR-10 Vallecitos Nuclear $ 14,500,000 Americas, LLC Center Vallecitos Nuclear 6705 Vallecitos Rd.
Center (EVESR reactor) Sunol, CA 94566 GE Hitachi Nuclear Energy SNM-960 Vallecitos Nuclear $ 48,000,000 Americas, LLC Center Vallecitos Nuclear 6705 Vallecitos Rd.
Center Sunol, CA 94566 GE Hitachi Nuclear Energy SNM-2500 Morris Operation $ 96,800,000 Americas, LLC 7555 East Collins Rd.
Morris Operation Morris, IL 60450 Total $448,000,000 U.S.NRC May 1, 2017
Attachment 2
Fl NANCIAL TEST II (10 CFR Part 30 App. A Section I1.A.2)
GENERAL ELECTRIC COMPANY PARENT-COMPANY GUARANTEE OF DECOMMISSIONING FUNDING FOR GLOBAL NUCLEAR FUEL (AMERICA), LLC, GE Hitachi Nuclear Energy Americas LLC and GE REUTER STOKES, INC.
- 1. Current decommissioning cost estimates or certified amounts: (Dollars in Thousands)
- a. Decommissioning amounts covered by this parent company guarantee $ 448,000
- b. All decommissioning amounts covered by other NRC or Agreement State parent company guarantees or self-guarantees $ 49,800
- c. All amounts covered by parent company guarantees.
self-guarantees. or financial tests of other Federal or State agencies (e.g., EPA) $ 160,863
TOTAL $ 658,663
- 2. Current bond rating of most recent unsecured issuance of this firm Rating: AA-Name of rating service: Standard & Poor's
- 3. Date of issuance of bond: 11/03/14
- 4. Date of maturity of bond: 11/03/44
- S. Tangible net worth** (if any portion of estimates for decommissioning is included in total liabilities on your firm's financial statements. you may add the amount of that portion to this line) $ 2,255,000
- 6. Total net worth*** $ 79,887,000
- ?. Total assets in United States (required only if less than 90 percent of firm's assets are located in the United States) $ 141,716,000
Yes l!Q
- 8. Is line 5 at least $21 million? __.K._
- 9. Is line 6 at least 6 times line 1? _K_
- 10. Are at least 90 percent of firm's assets located in the United States? If not. complete line 11. ~
- 11. Is line 7 at least 6 times line 1? __.K._
- 12. Is the rating specified on line 2 BBB or better (if issued by Standard & Poor's) or Baa or better (if issued by Moody's)?
- Denotes figures derived from financial statements.
- Tangible net worth is defined as net worth minus intangible assets. Tangible net worth is not adjusted for the net book value of the nuclear facilities and sites and the related decommissioning reserves because decommissioning reserves exceed the net book value of the related nuclear facilities and sites.
- Excluding net book value and goodwill of the Nuclear facility and site.
CERTIFICATION
I, Jeffrey S. Bornstein, Senior Vice President and Chief Financial Officer of the General Electric Company, do hereby certify that the attached Minute #10855 entitled "Execution of Contracts and Other Instruments" is a true and correct copy of a portion of the minutes of the meeting of the board of Directors of General Electric Company held on April 26, 1988, which minutes were approved by the Board of Directors at its meeting on May 27, 1988, and revised on November 6, 2009.
Dated this 1st day of May 2017
and Chief Financial Officer
ATTEST:
EXECUTION OF CONTRACTS AND OTHER INSTRUMENTS
I, Victoria Vron, an Attesting Secretary of General Electric Company,
do hereby certify that the following is a true and correct copy of a delegation
of authority to execute contracts and other instruments on behalf of General
Electric Company pursuant to a resolution duly adopted by the Board of
Directors on April 26, 1988:
"RESOLVED, that (A) Any contract, lease, license, assignment, bond or other obligation, conveyance, power of attorney, guarantee, proxy, court pleading, release, tax return and related documents, or other instruments may be executed on behalf of this Company by the Chairman of the Board, a Vice Chairman of the Board, an Executive Vice President, a Senior Vice President, a Vice President reporting directly to the Chairman or a Vice Chairman of the Board, the Comptroller, the Treasurer, the Secretary, or any Vice President who is a corporate staff officer of the Company, all of the above-named individuals being hereinafter called "Authorized Persons."
I further certify that Jeffrey S. Bornstein is Senior Vice President and
Chief Financial Officer of General Electric. Company, and by reason of
holding said position pursuant to the above quoted Board of Directors
resolution has full authority to execute contracts and other instruments
which relate to General Electric Company.
Witness my hand and seal of the General Electric Company this 1st
day of May, 2017.
Attesting Secretary U.S. NRC May 1, 2017
Attachment 3
GENERAL ELECTRIC COMPANY PARENT-COMPANY GUARANTEE OF DECOMMISSIONING FUNDING FOR GLOBAL NUCLEAR FUEL-AMERICAS, LLC, GE Hitachi NUCLEAR ENERGY AMERICAS, LLC, AND GE REUTER STOKES, INC.
Guarantee made this 1st day of May, 2017. by the General Electric Company, a corporation
organized under the laws of the State of New York herein referred to as "guarantor", to the U.S.
Nuclear Regulatory Commission (NRC). beneficiary, on behalf of our subsidiaries Global Nuclear Fuel
Americas. LLC. Wilmington Fuel Manufacturing Facility, 3901 Castle Hayne Road, Wilmington, NC
28401, GE Hitachi Nuclear Energy Americas, LLC, Headquarters, 3901 Castle Hayne Road,
Wilmington, NC 28401. and GE Reuter Stokes, Inc., 8499 Darrow Road, Twinsburg, OH, 44087.
Recitals
- 1. The guarantor has full authority and capacity to enter into this guarantee under its bylaws,
articles of incorporation, and the laws of the State of New York, its State of incorporation.
Guarantor has approval from its Board of Directors to enter into this guarantee.
- 2. This guarantee is being issued to comply with regulations issued by the N RC, an agency of the
U.S. Government. pursuant to the Atomic Energy Act of 1954, as amended, and the Energy
Reorganization Act of 1974. NRC has promulgated regulations in Title 10, Chapter I of the
Code of Federal Regulations, Parts 50, 70, and 72, which require that a holder of, or an
applicant for, a reactor. materials, or interim storage facility license issued pursuant to 10 CFR
Part 50, 70, or 72, as applicable, provide assurance that funds will be available when needed
for required decommissioning activities.
Page 1 of 8 U.S.NRC May 1, 2017
- 3. The guarantee is issued to provide financial assurance for decommissioning activities for the
Global Nuclear Fuel-Americas, LLC, Wilmington Fuel Manufacturing Facility, 3901 Castle
Hayne Road, Wilmington. NC 28401, NRC License No. SNM-1097; GE Hitachi Nuclear Energy
Americas. LLC, Vallecitos Nuclear Center, 6705 Vallecitos Road, Sunol, CA 94566, NRC License
Nos. DPR-1. R-33, TR-1. DR-10, and SNM-960; GE Hitachi Nuclear Energy Americas, LLC, Morris
Operation, 7555 East Collins Road, Morris, IL 60450, NRC License No. SNM-2500; and GE
Reuter Stokes Facility, 8499 Darrow Road, Twinsburg, OH 44087, NRC License No. SNM-1826.
The decommissioning cost estimate for these facilities is $448,000,000.
- 4. The guarantor meets or exceeds the financial test criteria in Financial Test II (10 CFR Part 30
App. A Section I1.A.2) and agrees to comply with all notification requirements as specified in
10 CFR Part 50, 70 and 72 and Appendix A to 10 CFR Part 30.
The guarantor meets the following financial test:
(i) A current rating for its most recent uninsured, uncollateralized, and unencumbered
bond issuance of AAA, AA, A, or BBB (including adjustments of+ and -) as issued by
Standard & Poor's, or Aaa, Ao, A or Baa (including adjustment of 1. 2, or 3) as issued by
Moody's; and
(ii) Net worth at least six times the amount of the decommissioning funds being assured
by a parent company guarantee for the total of all nuclear facilities or parts thereof;
and
(iii) Tangible net worth of at least $21 million; and
(iv) Assets located in the United States amounting to at least 90 percent of total assets or
at least six times the costs covered by financial tests.
Page 2 of 8 U.S. NRC May 1, 2017
- 5. The guarantor has majority control of the voting stock for the following licensees covered by
this guarantee: Global Nuclear Fuel-Americas, LLC, Wilmington Fuel Manufacturing Facility,
3901 Castle Hayne Road, Wilmington, NC 28401, NRC License No. SNM-1097; GE Hitachi
Nuclear Energy Americas, LLC, Vallecitos Nuclear Center, 6705 Vallecitos Road, Sunol. CA
94566, NRC License Nos. DPR-1, R-33, TR-1. DR-10, and SNM-960; GE Hitachi Nuclear Energy
Americas, LLC, Morris Operation. 7555 East Collins Road, Morris, IL 60450, NRC License No.
SNM-2500; and GE Reuter Stokes Facility, 8499 Darrow Road, Twinsburg, OH 44087, NRC
License No. SNM-1826.
- 6. Decommissioning activities as used below refer to the activities required by 10 CFR Parts 50,
70, or 72, as applicable, for decommissioning of the facilities identified above.
Americas. LLC. and GE Reuter Stokes, Inc., pursuant to the guarantor's authority to enter into
this guarantee, the guarantor guarantees to the NRC that if any of the licensees fails to
perform the required decommissioning activities. as required by License Nos. SNM-1097,
DPR-1, R-33, TR-1, DR-10, SNM-960, SNM-2500 or SNM-1826, the guarantor shall:
(al carry out the required activities, or
(bl set up a trust fund in favor of the above identified beneficiary in the amount of the
current cost estimates for these activities.
In accordance with 10 CFR 30 Appendix A.II1.D.. GE Hitachi Nuclear Energy Americas, LLC and
Global Nuclear Fuel Americas LLC have established upfront standby trust funds with The
Bank of New York for the benefit of the NRC.
Page 3 of 8 U.S. NRC May 1. 2017
- 8. The guarantor agrees to submit revised financial statements. financial test data, and a
special auditor's report and reconciling schedule annually within 90 days of the close of the
parent guarantor's fiscal year.
- 9. The guarantor agrees that if, at the end of any fiscal year before termination of this
guarantee, it fails to meet the financial test criteria, the licensees shall each send within 90
days of the end of the fiscal year, by certified mail, notice to the NRC that the licensee intends
to provide alternative financial assurance as specified in 10 CFR Part 50, 70, or 72, as
applicable. Within 120 days after the end of the fiscal year, the guarantor shall establish
such financial assurance if Global Nuclear Fuel-Americas. LLC. GE Hitachi Nuclear Energy
Americas, LLC. and GE Reuter Stokes, Inc., have not done so.
- 10. Independent of any notification under paragraph 9 above. if the N RC determines for any
reason that the guarantor no longer meets the financial test criteria or that it is disallowed
from continuing as a guarantor for the facility under License Nos. SNM-1097, DPR-1. R-33,
TR-1. DR-10, SNM-960, SNM-2500 or SNM-1826 the guarantor agrees that within 30 days
after being notified by the NRC of such determination, an alternative financial assurance
mechanism as specified in 10 CFR Part 30, 40, 70, or 72, as applicable, shall be established by
the guarantor in the name of Global Nuclear Fuel-Americas, LLC, GE Hitachi Nuclear Energy
Americas, LLC. and GE Reuter Stokes, Inc. unless Global Nuclear Fuel-Americas. LLC, GE
Hitachi Nuclear Energy Americas, LLC, and GE Reuter Stokes, Inc. have done so.
- 11. The guarantor also agrees to notify the beneficiary promptly if the ownership of an
associated licensee or the parent firm is transferred and to maintain this guarantee until the
new parent firm or the licensee provides alternative financial assurance acceptable to the
beneficiary.
Page 4 of 8 U.S. NRC May 1, 2017
- 12. The guarantor agrees that if it determines, at any time other than as described in Recital 9,
that it no longer meets the financial test criteria or it is disallowed from continuing as a
guarantor, it shall establish alternative financial assurance as specified in 10 CFR Part 30, 40,
50, 70, 72, as applicable, within 30 days, in the name of Global Nuclear Fuel-Americas. LLC, GE
Hitachi Nuclear Energy Americas, LLC, and GE Reuter Stokes, Inc.. unless these licensees have
done so.
- 13. The guarantor as well as its successors and assigns agree to remain bound jointly and
severally under this guarantee notwithstanding any or all of the following: amendment or
modification of l_icense or NRC-approved decommissioning funding plan fo_r that facility, the
extension or reduction of the time of performance of required activities, or any other
modification or alteration of an obligation of the licensee pursuant to 10 CFR Part 50, 70 or
72.
- 14. The guarantor agrees that all bound parties shall be jointly and severally liable for all litigation
costs incurred by the beneficiary, NRC, in any successful effort to enforce the agreement
against the guarantor.
- 15. The guarantor agrees to remain bound under this guarantee for as long as Global Nuclear
Fuel-Americas. LLC, GE Hitachi Nuclear Energy Americas, LLC, and GE Reuter Stokes. Inc..
must comply with the applicable financial assurance requirements of 10 CFR Part 50, 70, or
72, as applicable, for the previously listed facilities, except that the guarantor may cancel this
guarantee by sending notice by certified mail to the NRC and to Global Nuclear Fuel
Americas. LLC. GE Hitachi Nuclear Energy Americas, LLC, and GE Reuter Stokes, Inc.. such
cancellation to become effective no earlier than 120 days after receipt of such notice by both
the NRC and Global Nuclear Fuel-Americas, LLC, GE Hitachi Nuclear Energy Americas, LLC.
and GE Reuter Stokes, Inc., as evidenced by the return receipts.
Page 5 of 8 U.S. NRC Moy 1. 2017
Americas, LLC, or GE Reuter Stokes, Inc., fails to provide alternative financial assurance as
specified in 10 CFR Part 50, 70 or 72, as applicable, and obtain written approval of such
assurance from the NRC within 90 days after a notice of cancellation by the guarantor is
received by both the NRC and Global Nuclear Fuel-Americas, LLC, GE Hitachi Nuclear Energy
Americas, LLC, and GE Reuter Stokes, Inc., from the guarantor, the guarantor shall provide
such alternative financial assurance in the name of Global Nuclear Fuel-Americas, LLC, GE
Hitachi Nuclear Energy Americas, LLC, and GE Reuter Stokes, Inc., or make full payment under
the guarantee.
- 17. The guarantor agrees that it is subject to Commission orders to make payments under the
guarantee agreement.
- 18. The guarantor agrees that if the guarantor admits in writing its inability to pay its debts
generally, or makes a general assignment for the benefit of creditors, or any proceeding is
instituted by or against the guarantor seeking to adjudicate it as bankrupt or insolvent. or
seeking dissolution, liquidation, winding-up, reorganization, arrangement. adjustment.
protection, relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency, or reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee, custodian, or other similar official for the
guarantor or for any substantial part of its property, or the guarantor takes any action to
authorize or effect any of the actions stated in this paragraph, then the Commission may:
al Declare that the financial assurance guaranteed by the parent company guarantee
agreement is immediately due and payable to the standby trust set up to protect the
Page 6 of 8 U.S. NRC May 1. 2017
public health and safety and the environment. without diligence, presentment.
demand, protect or any other notice of any kind, all of which are expressly waived
by guarantor; and (bl Exercise any and all of its other rights under applicable law.
- 19. The guarantor agrees to notify the NRC. in writing. immediately following the filing of a
voluntary or involuntary petition for bankruptcy under any chapter of Title 11
(Bankruptcy) of the United States Code (U.S.C.l, or the occurrence of any other event
listed in recital 17 of this guarantee and by or against the guarantor; the licensee; an entity
(as that term is defined in 11 U.S.C. 101(141) controlling the licensee or listing the
license or licensees as property of the estate; or an affiliate (as that term is defined in
11 U.S.C. 101(21) of the licensee. This notification must include: a description of the
event, including major creditors, the amounts involved. and the actions taken to assure
that the amount of funds guaranteed by the parent company guarantee for
decommissioning will be transferred to the standby trust as soon as possible; if a petition
of bankruptcy was filed, the identity of the bankruptcy court in which the petition for
bankruptcy was filed; and the date of filing of any petitio_ns.
20. The guarantor expressly waives notice of acceptance of this guarantee by the NRC or by
Global Nuclear Fuel-Americas. LLC, GE Hitachi Nuclear Energy Americas, LLC. and GE Reuter
Stokes. Inc., The guarantor also expressly waives notice of amendments or modification of
the decommissioning requirements and of amendments or modification of the respective
licenses.
Page 7 of 8 U.S. NRC May 1, 2017
- 21. If the guarantor files financial reports with the U.S. Securities and Exchange Commission.
then it shall promptly submit them to the NRC during each year in which this guarantee is in
effect.
I hereby certify that this guarantee is true and correct to the best of my knowledge.
General Electric Company Witness
Senior Vice President and Chief Financial Officer
Page 8 of 8 KPMG LLP Stamford Square 3001 Summer Street Stamford, CT 06905-4317
Independent Accountants' Report on Applying Agreed-Upon Procedures
The Board of Directors General Electric Company :
We have performed the procedures enumerated below, which were agreed to by management of General Electric Company (the Company), solely to assist you in the filing of selected financial information included in "Financial Test II" of your letter (the Financial Test) dated May 1, 2017 to the United States Nuclear Regulatory Commission. The Company's management is responsible for the selected financial information. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of management of General Electric Company. Consequently, we make no representations regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose.
The procedures and associated findings are as follows:
- 1) Tangible Net Worth - We recalculated the dollar amount of the GE(a)'s tangible net worth at December 31, 2016, of $2,255,000,000, as the difference of Total Assets, $277,874,000,000, less the sum of Goodwill,
$68,070,000,000 and Other Intangible Assets, excluding Intellectual Intangible Assets, $9,905,000,000,
and Total Liabilities, $197,644,000,000, at December 31, 2016, each reflected in the Statement of Financial Position for GE(a) on page 137 of the Company's 2016 Annual Report. We then compared the dollar amount of the Company's tangible net worth at December 31, 2016, to the amount shown in Item 5 of the Financial Test, found them to be in agreement. We calculated Tangible Net Worth of $2,255,000,000 to be greater than $21 million.
- 2) Total Net Worth - We recalculated the dollar amount of the GE(a) total net worth at December 31, 2016, of
$79,887,000,000, as the difference of Total Assets, $277,874,000,000, less Total Liabilities,
$197,644,000,000, reflected in the Statement of Financial Position for GE(a) on page 137 of the Company's 2016 Annual Report at December 31, 2016, less the net book value and goodwill of the Nuclear facility and site, $343,000,000. We agreed the net book value and goodwill of the Nuclear facility and site to a schedule prepared by management. We compared the dollar amount of the Company's total net worth at December 31, 2016, to the amount shown in Item 6 of the Financial Test, and found them to be in agreement. We calculated Total Net Worth of $79,887,000,000 which is greater than $3,952,000,000, the calculation of 6 times the decommissioning costs estimates.
- 3) Total Assets in the United States - We compared GE(a)'s Total Assets in the United States at December 31, 2016, $141,716,000,000 as shown in Item 7 of the Financial Test, to a schedule prepared by the Company entitled "Working Capital and Geographic Assets" and found them to be in agreement.
- 4) Are At Least 90% of the Company's Assets Located in the United States-We divided the GE(a)'s Total Assets in the United States at December 31, 2016, $141,716,000,000, as shown in Item 7 of the Financial Test, by GE(a)'s Total Assets at December 31, 2016, $277,874,000,000, reflected in the GE(a) Statement of Financial Position on page 137 of the Company's 2016 Annual Report, and found that the Company ' s
(a) - Per the Company's 2016 form 10-K, GE(a) represents the adding together of all affiliated companies except GE Capital, which is presented on a one-line bas is.
KPMG LLP 1s a Delaware hm1ted !l;ibllity pa1tnc:r~h1p and the US member furn of the KPMG netwo1k or 1ndep1:mr1ent member firms nftiliated with KPMG lnternattonal Coope1at1ve ("KPMG lnternarionnl"), a Swiss cnmy Total Assets in the United States were less than 90% of the Company's Total Assets. Accordingly, we agree with the Company's response of "No" in Item 10 of the Financial Test.
- 5) Tangible Net Worth Greater than Maximum Potential Future Payments - We calculated the difference between the amount calculated in procedure 1 above to the total "Maximum Potential Future Payments" related to off-balance sheet transactions such as contractual obligations to fund investment or guarantees, revolving lines of credit, credit support, indemnification agreements and other indemnification commitments as disclosed in note 23 and note 21 of the Company's 2016 Annual Report on the Form 10-K. "Maximum Potential Future Payments" is defined as the sum of contractual obligations to fund investments or guarantees, revolving lines of credit, credit support, indemnification agreements and other indemnification commitments. Accordingly, we agree that the Tangible Net Worth of GE(a} as per procedure 1 is greater than the "Maximum Potential Future Payments" by $180,000,000 ($2,255,000,000 less $2,075,000,000).
- 6) Bond Rating - We obtained the bond rating for the Company's most recent uninsured, uncollateralized, and unencumbered bond issuance with the latest maturity as issued by Standard and Poors on September 23, 2016. The Standard and Poors rating was "AA-." No differences were noted from the requirements within Section II.A of 10 CFR Part 30, Appendix C. Accordingly, we agree with the Company's response of"Yes" in Item 12 of the Financial Test.
We were not engaged to, and did not, conduct an examination, the objective of which would be the expression of an opinion on the selected financial information included in the Letter. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.
This report is intended solely for the use of management of the Company, and is not intended to be and should not be used by anyone other than these specified parties.
May 1, 2017
(a) - Per the Company ' s 2016 form 10-K, GE(a) represents the adding together of all affiliated companies except GE Capital, which is presented on a one-line basis.
2