Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On April 1, 2021, the Louisiana Local Government Environmental Facilities and Community Development Authority (the “Authority”) issued and sold in a public offering for the benefit of Entergy Louisiana, LLC (the “Company”) (i) $16,200,000 aggregate principal amount of tax-exempt pollution control refunding revenue bonds (the “2021A Bonds”) and (ii) $182,480,000 aggregate principal amount of tax-exempt pollution control refunding revenue bonds (the “2021B Bonds” and, together with the 2021A Bonds, the “Bonds”).
The 2021A Bonds bear interest at the rate of 2.00%, payable semi-annually on June 1 and December 1 of each year, commencing June 1, 2021, and mature on June 1, 2030. The 2021B Bonds bear interest at the rate of 2.50%, payable semi-annually on April 1 and October 1 of each year, commencing October 1, 2021, and mature on April 1, 2036.
Each series of the Bonds was issued under a separate Trust Indenture, dated as of April 1, 2021 (each an “Indenture”), between the Authority and The Bank of New York Mellon, as Trustee (the “Trustee”), and is payable solely from payments to be made by the Company pursuant to a separate Loan Agreement, dated as of April 1, 2021, between the Company and the Authority (each a “Loan Agreement”), pursuant to which the Authority has loaned the proceeds of such series of Bonds to the Company.
The Bonds of each series are secured by a pledge and assignment by the Authority to the Trustee of the revenues derived from the payments to be made by the Company pursuant to the related Loan Agreement, which payments are intended to be sufficient to enable the Trustee to pay when due the principal of and interest on such series of Bonds.
The obligation of the Company under each Loan Agreement to make such payments is evidenced by a separate series of the Company’s collateral trust mortgage bonds (“Mortgage Bonds”) issued and delivered under the Company’s Mortgage and Deed of Trust, dated as of November 1, 2015, with The Bank of New York Mellon, as trustee, as supplemented and modified (the “Mortgage”). Each series of Mortgage Bonds is held by the Trustee for the benefit of the holders of the related series of Bonds.
The proceeds received by the Authority from the sale of the Bonds, together with other funds provided by the Company, are being used to refinance the Company’s obligations with respect to certain outstanding series of pollution control revenue bonds.
The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the complete text of the Indentures, the Loan Agreements, the officer’s certificate and supplemental indenture establishing the Mortgage Bonds and the Mortgage.