Illinois Administrative Code › Title 32 - ENERGY › Part 326 - FINANCIAL ASSURANCE REQUIREMENTS › Appendix E - Wording for Self-Guarantee Documents

Current through Register Vol. 48, No. 28, July 12, 2024
a) A self-guarantee, as specified in 32 Ill. Adm. Code 326.130,
				shall contain letters from the chief executive officer and the chief financial
				officer containing the following provisions, except that instructions in
				brackets are to be replaced with the relevant information and the brackets
				deleted:
CHIEF EXECUTIVE OFFICER
I am the [chief executive officer or equivalent] of
				[name and address of firm], a [insert "proprietorship," "partnership," or
				"corporation"]. This letter is in support of this firm's use of the financial
				test to demonstrate financial assurance, as specified in 32 Ill. Adm. Code
				326.
I hereby certify that [name of firm] is currently a
				going concern, and that it possesses positive tangible net worth in the amount
				of $__________.
This firm [insert "is required" or "is not
				required"] to file a Form 10K with the U.S. Securities and Exchange Commission
				for the latest fiscal year. The fiscal year of this firm ends on [month,
				day].
I hereby certify that the content of this letter is
				true and correct to the best of my knowledge.
[Signature]
[Below the signature, type or print that person's
				name and title]
[Date]
CHIEF FINANCIAL OFFICER
I am the [chief financial officer or equivalent] of
				[name and address of firm], a [insert "proprietorship," "partnership," or
				"corporation"]. This letter is in support of this firm's use of the financial
				test to demonstrate financial assurance, as specified in 32 Ill. Adm. Code
				326.
[Complete the following paragraph regarding
				facility(ies) and associated cost estimates or amounts specified in 32 Ill.
				Adm. Code
				326.70.
				For each facility, include its license number, name, address and current cost
				estimates for the specified activities.]
This firm guarantees, through the self-guarantee
				submitted to demonstrate compliance under 32 Ill. Adm. Code 326, the
				reclamation of the following facility(ies) owned or operated by this firm. The
				current cost estimates or amounts specified in 32 Ill. Adm. Code 326.70, so
				guaranteed, are shown for each facility:
Name of Facility
Location of Facility
Cost Estimate or 326.70
						  Amounts
This firm [insert "is required" or "is not
				required"] to file a Form 10K with the U.S. Securities and Exchange Commission
				for the latest fiscal year.
The fiscal year of this firm ends on [month, day].
				The figures for the financial test required by 32 Ill. Adm. Code
				326.140
				are derived from this firm's independently audited, year-end financial
				statements and footnotes for the latest completed fiscal year, ended
				[date].
[Insert completed financial test applicable to
				licensee from subsection (c), (d) or (e) of this Appendix.]
I hereby certify that the content of this letter is
				true and correct to the best of my knowledge.
[Signature]
[Below the signature, type or print that person's
				name and title]
[Date]
b) A self-guarantee, as specified in 32 Ill. Adm. Code 326.130,
				shall contain the following provisions, except that instructions in brackets
				are to be replaced with the relevant information and the brackets
				deleted:
SELF-GUARANTEE
Self-guarantee made this [date] by [name and address of
				licensee], a [insert "proprietorship," "partnership," or "corporation"]
				organized under the laws of the State of [insert name of state], herein
				referred to as "licensee," to the Illinois Emergency Management Agency
				(hereinafter called the Agency).
Recitals
1) The licensee has full authority and capacity to
				enter into this guarantee [if guarantor is a corporation, add the following
				phrase "under its bylaws, articles of incorporation, and the laws of the State
				of [insert licensee's state of incorporation], its state of incorporation."].
				[If the licensee has a Board of Directors, insert the following: "Licensee 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 Agency, pursuant to the Radiation Protection Act of
				1990. The Agency has promulgated regulations in 32 Ill. Adm. Code 326 that
				require that general or specific licensees provide assurance that funds will be
				available when needed for reclamation activities.
3) The guarantee is issued to provide financial
				assurance for reclamation activities for [identify licensed facility(ies)] as
				required by 32 Ill. Adm. Code 326. The reclamation costs are as follows:
				[insert the current cost estimates or amounts specified in 32 Ill. Adm. Code
				326.70 guaranteed for each identified facility].
4) The licensee meets or exceeds the financial test
				criteria specified in 32 Ill. Adm. Code 326.140 and agrees to comply with all
				notification requirements as specified in 32 Ill. Adm. Code 326.
5) Reclamation activities as used in this Appendix E
				refers to the activities required by 32 Ill. Adm. Code 330 for reclamation of
				facility(ies) identified in this Appendix E.
6) The licensee guarantees to the Agency that it
				will:
A) Carry out the required reclamation activities as
				required by 32 Ill. Adm. Code 330; or
B) Upon written notification from the Agency, pay
				the reclamation cost amount guaranteed for the facility(ies) to the Agency
				directed by the Director.
7) The licensee shall submit revised financial
				statements, financial test data and an auditor's special report and reconciling
				schedule annually within 90 days after the close of the licensee's fiscal
				year.
8) If, at the end of any fiscal year before
				termination of this guarantee, the licensee fails to meet the financial test
				criteria, the licensee shall send within 90 days after the end of the fiscal
				year, by certified mail, return receipt requested, notice to the Agency that
				the licensee intends to provide alternative financial assurance as specified in
				32 Ill. Adm. Code 326.170. Within 120 days after the end of the fiscal year,
				the licensee shall provide such financial assurance.
9) The licensee shall notify the Agency promptly if
				the ownership of the licensee is transferred and shall maintain this guarantee
				until the new parent firm or the licensee provides alternative financial
				assurance acceptable to the Agency.
10) The licensee, as well as its successors and
				assigns, agrees to remain bound jointly and severally under this guarantee
				notwithstanding any or all of the following: amendment or modification of the
				license or Agency-approved reclamation funding plan for 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 32 Ill. Adm. Code 326.
11) All bound parties shall be jointly and severally
				liable for all litigation costs incurred by the Agency in any successful effort
				to enforce this guarantee.
12) The licensee shall remain bound under this
				guarantee for as long as the licensee must comply with the applicable financial
				assurance requirements of 32 Ill. Adm. Code 326 for the previously listed
				facility(ies), except that the licensee may cancel this guarantee by meeting
				the requirements of 32 Ill. Adm. Code 326.170.
13) If the licensee fails to provide alternative
				financial assurance as specified in 32 Ill. Adm. Code 326.170, the licensee
				shall make full payment under this guarantee.
14) If the licensee files financial reports with the
				U.S. Securities and Exchange Commission, then it shall promptly submit them to
				the Agency during each year in which this guarantee is in effect.
I hereby certify that the content of this guarantee
				is true and correct to the best of my knowledge.
Effective date:_________________
[Name of licensee]
[Signature of chief executive officer or
				equivalent]
[Below the signature, type or print that person's
				name and title]
Signature of witness or
				notary:_________________________
c) Financial test documentation for self-guarantee for a
				commercial company issuing bonds
1) Current reclaiming and decommissioning cost
				estimates or certified amounts
A) Current reclaiming cost estimate or certified
				amount for all decommissioning activities covered by this
				self-guarantee$___________
B) Total reclaiming cost estimates and certified
				amounts for all decommissioning activities covered by other NRC or Agreement
				State guarantees, parent company guarantees or
				self-guarantees$__________
C) Total amounts for all decommissioning activities
				under parent company guarantees, self-guarantees and commitments to other
				regulatory agencies (e.g.,
				USEPA)$_________
Total for line
				1$__________
2) Current bond rating of most recent unsecured issuance of
				this firm
Rating_____________
Name of rating
				service_______________________
3) Date of issuance of bond
				___________________
4) Date of maturity of bond
				____________________
5)* Tangible net worth** (if any portion of the cost
				estimates for reclaiming or decommissioning is included in total liabilities on
				your firm's financial statements, you may add the amount of that portion to
				this
				line)$__________
6)* Total assets in United States (required only if
				less than 90 percent of firm's assets are located in the United
				States)$__________
Yes
No
7) Is line 5 at least 10 times line 1?
8) Are at least 90 percent of the firm's assets
				located in the United States? If not, complete line 9
9) Is line 6 at least 10 times line 1?
10) Is rating specified on line 2 "A" or
				better
11) Does the licensee have at least one class of
				equity securities registered under the Securities Exchange Act of 1934?
* Denotes figures derived from financial
				statements.
** Tangible net worth is defined as net worth minus
				goodwill, patents, trademarks and copyrights.
d) Financial test documentation for commercial companies that
				have no outstanding rated bonds:
1) Current reclaiming and decommissioning cost
				estimates or certified amounts
A) Current reclaiming cost estimate or certified
				amount for all decommissioning activities covered by this
				self-guarantee$___________
B) Total reclaiming cost estimates or certified
				amounts for all decommissioning activities covered by other NRC or Agreement
				State guarantees, parent company guarantees or
				self-guarantees$___________
C) Total amounts for all decommissioning activities
				under parent company guarantees, self-guarantees and commitments to other
				regulatory agencies (e.g.,
				USEPA)$____________
Total for line 1
2)* Total liabilities (if any portion of the cost
				estimates for reclaiming or decommissioning is included in total liabilities on
				your firm's financial statements, you may deduct the amount of that portion
				from this line and add that amount to lines 3 and
				4)$__________
3)* Tangible net
				worth**$_________
4)* Net
				worth$_________
5)* The sum of net income plus depreciation,
				depletion and
				amortization$________
6)* Total assets in United States (required only if
				less than 90 percent of firm's assets are located in the United
				States)$________
Yes
No
7) Is line 3 greater than $10 million, or at least
				10 times line 1, whichever is greater
8) Are at least 90 percent of the firm's assets
				located in the United States? If not, complete line 9
9) Is line 6 at least 10 times line 1?
10) Is line 5 divided by line 2 greater than 0.15
				?
11) Is line 2 divided by line 4 less than 1.5
				?
* Denotes figures derived from financial
				statements.
** Tangible net worth is defined as net worth minus
				goodwill, patents, trademarks and copyrights.
e) Financial test documentation for self-guarantee for
				hospitals (Complete either Alternative 1 or Alternative 2):
Alternative 1
1) Current bond rating of most recent unsecured
				,uncollateralized and unencumbered issuance of this institution
Rating____________________
Name of rating
				service____________________
2) Date of issuance of
				bond_____________________
3) Date of maturity of
				bond______________________
Yes
No
4) Is the rating specified on line 1 "a" or
				better
Alternative 2
1) Current reclaiming and decommissioning cost
				estimates or certified amounts
A) Current reclaiming cost estimate or certified
				amount for all decommissioning activities covered by this
				self-guarantee$__________
B) Total reclaiming cost estimates and certified
				amounts for all decommissioning activities covered by other NRC or Agreement
				State guarantees, parent company guarantees or
				self-guarantees$_________
C) Total amounts for all decommissioning activities
				under parent company guarantees, self-guarantees and commitments to other
				regulatory agencies (e.g.,
				USEPA)$____________
Total for line
				1$_________
2)* Total
				revenues$_________
3)* Operating
				revenues$_________
4)* Total
				expenditures$_________
5)* Total long-term
				debt$_________
6)* Net fixed
				assets**$_________
7)* Current
				assets$_________
8)* Depreciation
				fund$_________
9)* Current
				liabilities$_________
Yes
No
10) Is line 3 at least 100 times line 1?
Guarantor shall meet each of the
				following ratios:
Yes
No
11) Is (line 2 minus line 4) divided by line 2 at
				least 0.04?
12) Is line 5 divided by line 6 less than or equal
				to 0.67?
13) Is (line 7 plus line 8) divided by line 9 at
				least 2.55?
* Denotes figures derived from financial
				statements.
** Net fixed assets is defined as fixed assets minus
				accumulated depreciation.
f) A self-guarantee, as specified in 32 Ill. Adm. Code 326.130
				and 326.140, shall include submission of an auditor's special report containing
				the following provisions, except that instructions in brackets are to be
				replaced with the relevant information and the brackets deleted:
AUDITOR'S CONFIRMATION OF CHIEF FINANCIAL
				OFFICER'S LETTER
We have examined the financial statements of
				[self-guarantor's name] for the year ended [insert date], and have issued our
				report thereon dated [date]. Our examination was made in accordance with
				generally accepted auditing standards and, accordingly, included such tests of
				the accounting records and such other auditing procedures as we considered
				necessary. [Self-guarantor's name] has prepared documents to demonstrate its
				financial responsibility under the Illinois Emergency Management Agency's
				financial assurance regulations, 32 Ill. Adm. Code 326. This letter is
				furnished to assist the licensee [insert IEMA license number and name] in
				complying with these regulations and should not be used for other
				purposes.
The attached schedule reconciles the specified
				information furnished in the chief financial officer's (CFO's) letter with the
				company's financial statements. In connection therewith, we have:
1) Confirmed that the amounts in the column "Per
				Financial Statements" agree with amounts contained in the licensee's financial
				statements for the year ended [date];
2) Confirmed that the amounts in the column "Per
				CFO's Letter" agree with the amounts in the chief financial officer's
				letter;
3) Confirmed that the amounts in the column
				"Reconciling Items" are adequately explained in the attached schedule, that
				each reconciling item represents an appropriate adjustment to the financial
				data, and that the amount of each reconciling item is accurate; and
4) Recomputed the totals and percentages.
Because the procedures in paragraphs (1)-(4) above
				do not constitute a full examination made in accordance with generally accepted
				auditing standards, we do not express an opinion on the manner in which the
				amounts were derived in the items referred to above. In connection with the
				procedures referred to above, no matters came to our attention that cause us to
				believe that the chief financial officer's letter and supporting information
				should be adjusted.
__________________________________________
SignatureDate
AUDITOR'S SCHEDULE RECONCILING AMOUNTS IN
				CFO'S LETTER
[Name of
				self-guarantor]
Year ended
				[date]
Line # in CFO'S Letter
Per Financial Statements
Reconciling Items
Per CFO's Letter
6
Total current liabilities
X
Long-term debt
X
Deferred income taxes
X
XX
Accrued decommissioning cost included in current
						  liabilities
X
Total liabilities (less accrued decommissioning
						  cost)
X
4
Net worth
XX
Less: Cost in excess of value of tangible assets
						  acquired
X
XX
Accrued decommissioning costs included in current
						  liabilities
X
Tangible net worth (plus decommissioning costs)
XX
(Balance of schedule is not
				illustrated.)
AGENCY NOTE: This illustrates the form of schedule that is
				  contemplated. Details and reconciling items will differ in specific
				  situations.