SNRC-1830, Provides Addl Info Re Line of Credit Discussed in Re Decommissioning Funding
| ML20082K514 | |
| Person / Time | |
|---|---|
| Site: | Shoreham File:Long Island Lighting Company icon.png |
| Issue date: | 08/21/1991 |
| From: | Leonard J LONG ISLAND LIGHTING CO. |
| To: | Crutchfield D Office of Nuclear Reactor Regulation |
| References | |
| SNRC-1830, NUDOCS 9108300095 | |
| Download: ML20082K514 (4) | |
Text
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- ECO LONG ISLAND LIGHTING COMPANY
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- W ADING HlVE R. N Y. I 179 2 JOHN 0 LEONARD,JA vlCE Pnf WDENT.orricE or cor4PosMTE SEFWICES AND YlCE PMSIDENT - OFFICE C$ NUCL E AR 3NRC-1830
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AUG 21 1991 Dennis M. Crutchfield, Director Division of Advanced Reactors and Special Projects Office of Nuclear Reactor Regulation Document Control Desk U.
S.
Nuclear Regulatory Commission Washington, D.C.
20555 Decommissioning i anding for Shore. ham Shoreham Nuclear Power Station - Unit 1 Docket No. 50-322 Ref:
LILCO (J.D. Leonard, Jr.) letter to NRC ( D,, Crutchfield dated 6/20/91 SNRC-1816, subject:
Decommissioning Funding (TAC No. 77272)
Dear Mr. Crutchfield:
We understand that the NRC Staff would find useful some further information about the 300 million dollar line of credit discussed on page 6 of LILCO's June 20, 1991 letter to you (SNRC-1816).
Further detail follows.
1.
This line of credit now totals 300 million dollars.
LILCO believes that it will be able to maintain such a line of credit for the foreseeable future.
2.
The line of credit is " evergreen,"
That is, it or a successor line stays in place at all times, renewed periodically.
The current " Revolving Credit Agreement" is dated June 27, 1989.
With the lenders' consent, it can be extended in one-year intervals beyond its initial maturity date of October 1992.
LILCO is now in discussions with its lenders to extend the line to c }: 00 51-October 1993.
LILCO already has commitments for 265 million dollars and expects that the full 300 million dollars will be in place wel.1 before October 1992.
As C"
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already indicated, LILCO intends for the foreseeable future to maintain this or a successor line of credit.
U OOOMO95 v1vuzi DR ADOCK 05000322 l6 PDR
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'SNRC-1830
-Page: 2 3.
The banks participating in the June 1989 Revolving Credit Agreement, and the amounts of their.
participation, are:
Bank Participation in the Revolving Credit Agreement
$ Millions Bank
$ Participation Chemical Bank 51.3
' Chase Manhattan Bank, N.A.
36.3 Citibank, N.A..
55.4
-Bankers Trust Company
-30.0 Bank of New York 20.0 Manufacturers Hanover Trust Co.
20.0 Canadian Imperial Bank of Commerce 12.0 Bank of Tokyo Trust 10.0
- Marine Midland Bank, N.A.
10.0.
Mellon Bank 10.0 Union Bank of Switzerland 10.0 The Nippon Bank Ltd.
11.0 4
-Tokai Bank,.-Limited-10.0.
Gulf International Bank,.B.S.C.
4.0 Bank of California 10.0
~300.0.
4.
LILCO has not drawn on this line of credit since its inception almost 26 months ago.
LILCO does not expect that_it will need-to draw on the line during the period of Shoreham's decommissioning.
If short-term cash flow needs'do develop for LILCO during this' time, the Company believes'that'they will end quickly and not~ threaten _the line of credit's capacity-to be a " failsafe" reserve for decommissioning funding, as described.on page 6 of SNRC-1816.
S.
.In the exceptionally remote event that-funds were needed from the line of credit for decommissioning purposes, the money would be available to LILCO within two to four business. days after LILCo's request for it.
6.
The basic terms of the 300 million dollar line of credit are these:
'Co-Agent: Banks:
- Citibank, N.A.,
Chemical Bank, and The Chase Manhattan Bank, National Association E
O Amount Avaitable
$300 Million j
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'SNRC-1830 Page :3-l Security:
First lien on LILCO's accounts receivable.
and fuel oil inventory.
Term andl Maturity Date: 3 years, expiring October 1, 1992, with the option to extend, with the banks' consent, for one-year periods at LILCO's request Commitment Fees on 25 basis points per year paid quarterly Unused-Portions.
in arrears Interest Rate Options:
At LILCO's option:
(1)
Citibank Prime Rate (2)
Adjusted CD Rate:
$0-75M outstanding
= Adj. CD Rate + 70 bp-
$75-150M outstanding = Adj. CD_ Rate + 75 bp-
$150-225M outstar ding = Adj. CD Rate + 80 bp
$225-300M outstanding = Adj. CD Rate + 85 bp (3)
Adjusted LIBO Eate:
$0-75M outstanding
= Adi._LIBO Rate +-60 bp
$7f-150M outstanding = Adj. LIBO Rate + 65 bp
$150-225M outstanding = Adj. LIBO Rate + 70 bp
$225-300M outstanding = Adj. LIBO Ratef+ 75 bp.
(4) ' Adjustments to the LIBOR &.CD spreads:
R If LILCO's~GeneralE& Refunding Bonds-are rated Baa2 & BBB-orlBaa3 & BBB lar Moody's'and Standard & Poor's, respectively, -15 bp; If LILCO's General.& Refunding Bonds are rated Baal &-BBB or Baa2 &-BBB+
by Moody's and Standard & Poor's,-
respectively,-an additional -15 bp; 4
o If LILCO's General &_ Refunding Bonds are rated Ba2 & BB or lower by
-Moody!s and Standard &-Poor's,
-respe'ctively, +15 bp.
j 1
Optional' Prepayment:
Optional in whole or in part without
_ penalty'provided payment is made on the last'duy of-an interest period LRepresentation and Warranties:
Standard
- l
_ _= _ _
- s SNRC-1830 Page 4 Covenants:
Standard, plus compliance with the terms and conditions of the Shorcham Agreements Events of Defaults Standard 4
Notice to Borrow Within 2 to 4 business days depending on the interest rate mode selected:
Notice
_ Interest Requirement Mode 2 Days Prime Rate 3 Days CD Rate 4 Days LIBO Rate 7.
Finally, if the decommissioning funding arrangements for Shoreham described in SNRC-1816 are found to be acceptable, LILCO commits to reserve part of its 330 million dollar line of credit as a financial " failsafe" for decommissioning funding.
As indicated in SNRC-1816, this reserve "would be enough at any time to cover estimated, yet-to-be-incurred decommissioning costs that are not otherwise guaranteed by the sum of (1) the three months' prepayment required by the Site Agreement and (2) the 10 million dollar separate contingency fund that LILCO has agreed to establish."
Please let me know if the Staff needs further information.
LILCO is concerned to resolve Shoreham's decommissioning funding as soon as is feasible, Very truly yours, v
i nard,d e N
k.
(
f o: h Jr.
/ Vi President, Offi e f Corporate Services and Vice President, ffi.e of Nuclear WT / ab cc:
S. Brown T.
T.
Martin B.
Norris i
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