If my read of the last quarterly report is correct we're both somewhat right and somewhat wrong. The EDC facility was for $750M of which $175M was drawn as of September 30th, 2006. My take came from the first reference which got paid back when they issued the recent $2B in convertible notes. Your take may have come from the second EDC reference from which it seems they had yet to draw the full amount. Maybe, the EDC is the source of the extra cash.
Does this interpretation make sense to you?
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First EDC Credit Reference - paid off
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On February 14, 2006, Nortel’s indirect subsidiary, Nortel Networks Inc. (‘‘NNI’’), entered into a new one-year credit facility in the aggregate principal amount of $1,300 (the ‘‘2006 Credit Facility’’).
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The 2006 Credit Facility was drawn down in the full amount on February 14, 2006, and Nortel used the net proceeds primarily to repay the outstanding $1,275 aggregate principal amount of NNL’s 6.125% notes that matured on February 15, 2006. The 2006 Credit Facility was amended in the second quarter of 2006 and waivers were obtained in connection with defaults arising from the delayed filing of the 2005 Annual Reports and the 2006 First Quarter Reports. On July 5, 2006, the total amount owing under the 2006 Credit Facility was repaid using the proceeds from the issuance of the Notes (as defined below) and as such the facility and all of the collateral arrangements securing it and Nortel’s and NNL’s public debt were terminated.
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Second EDC Credit Facity - $750M of which $175M drawn Sep/06
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On February 14, 2003, NNL entered into an agreement with Export Development Canada (‘‘EDC’’) regarding arrangements to provide for support of certain performance related obligations arising out of normal course business activities for the benefit of Nortel (the ‘‘EDC Support Facility’’). On December 10, 2004, NNL and EDC amended the terms of the EDC Support Facility by extending the termination date of the EDC Support Facility to December 31, 2006 from December 31, 2005. Effective October 24, 2005, NNL and EDC amended and restated the EDC Support Facility to maintain the total EDC Support Facility at up to $750, including the existing $300 of committed support for performance bonds and similar instruments, and the extension of the maturity date of the EDC Support Facility for an additional year to December 31, 2007.
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As of September 30, 2006, there was approximately $175 of outstanding support utilized under the EDC Support Facility, approximately $143 of which was outstanding under the revolving small bond sub-facility. |
