CREDIT FACILITIES AND LONG-TERM DEBT

9 Months Ended

Sep. 30, 2014

CREDIT FACILITIES AND LONG-TERM DEBT

CREDIT FACILITIES AND LONG-TERM DEBT

NOTE 5CREDIT FACILITIES AND LONG-TERM DEBT

(unaudited)
(millions of dollars)		September 30, 2014	December 31, 2013
Senior Credit Facility due 2017		335	380
Term Loan Facility due 2018		500	500
4.65% Unsecured Senior Notes due 2021		349	349
5.09% Unsecured Senior Notes due 2015		75	75
5.29% Unsecured Senior Notes due 2020		100	100
5.69% Unsecured Senior Notes due 2035		150	150
3.82% Series D Senior Notes due 2017		24	24
		1,533	1,578
Less: current portion of long-term debt	79			3
	1,454			1,575

The Partnership’s Senior Credit Facility consists of a $500 million senior revolving credit facility with a banking syndicate, maturing November 20, 2017, under which $335 million was outstanding at September 30, 2014 (December 31, 2013 - $380 million), leaving $165 million available for future borrowing.

The London Interbank Offered Rate (LIBOR) based interest rate on the Senior Credit Facility averaged 1.41 percent for the three and nine months ended September 30, 2014 (2013 – 1.44 and 1.45 percent). The LIBOR-based interest rate was 1.41 percent at September 30, 2014 (December 31, 2013 – 1.42 percent).

On July 1, 2013, the Partnership entered into a term loan agreement with a syndicate of lenders for a $500 million term loan credit facility (Term Loan Facility). On July 2, 2013, the Partnership borrowed $500 million under the Term Loan Facility.

The LIBOR-based interest rate on the Term Loan Facility averaged 1.41 percent for the three months ended September 30, 2014 (2013 – 1.44 percent).  For the nine months ended September 30, 2014, the interest averaged 1.41 percent. After hedging activity, the interest rate incurred on the Term Loan Facility averaged 1.83 percent for three months ended September 30, 2014 (2013 – 1.56 percent).  For the nine months ended September 30, 2014, the interest rate averaged 1.83 percent. Prior to hedging activities, the LIBOR-based interest rate was 1.41 percent at September 30, 2014 (December 31, 2013 – 1.42 percent).

The Partnership’s Senior Credit Facility and Term Loan Facility contain a covenant requiring us to maintain a maximum agreed upon leverage ratio.

GTN’s Senior Notes provisions contain a covenant that limits total debt to no greater than 70 percent of total capitalization.

The Series D Senior Notes, which require yearly principal payments until its maturity, are secured by Tuscarora’s transportation contracts, supporting agreements and substantially all of Tuscarora’s property. The note purchase agreements contain certain provisions that include, among other items, limitations on additional indebtedness and distributions to partners.

As of September 30, 2014, the Partnership was in compliance with its financial covenants, in addition to the other covenants which include restrictions on entering into mergers, consolidations and sales of assets, granting liens, material amendments to the Second Amended and Restated Agreement of Limited Partnership (Partnership Agreement), incurring additional debt and distributions to unitholders.

The principal repayments required on the long-term debt are as follows:

(unaudited)
(millions of dollars)
2014	3
2015	79
2016	4
2017	348
2018	500
Thereafter	599
	1,533