ASSETS HELD FOR SALE

In June 2015, Eversource and PSNH entered into the 2015 Public Service Company of New Hampshire Restructuring and Rate Stabilization Agreement, under the terms of which PSNH agreed to divest its generation assets, subject to NHPUC approval. The NHPUC approval for this agreement, as well as NHPUC approval of the final divestiture plan and auction process, were received in the second half of 2016. In October 2017, PSNH entered into two Purchase and Sale Agreements ("Agreements") to sell its thermal and hydroelectric generation assets to private investors at purchase prices of $175 million and $83 million, respectively, subject to adjustments as set forth in the Agreements. The NHPUC approved the Agreements in late November 2017, at which time the Company classified these assets as held for sale.

On January 10, 2018, PSNH completed the sale of its thermal generation assets, pursuant to the Agreement dated October 11, 2017. In accordance with the Purchase and Sale Agreement, the original purchase price of $175 million was adjusted to reflect working capital adjustments, closing date adjustments and proration of taxes and fees prior to closing, totaling $40.9 million, resulting in net proceeds of $134.1 million. As of March 31, 2018, deferred costs resulting from the thermal generation asset sale totaled $539.6 million and were included in Regulatory Assets on the Eversource and PSNH Balance Sheets. As of December 31, 2017, this balance totaled $516.1 million and represented the difference between the carrying value and the fair value less cost to sell of the thermal generation assets.

PSNH expects to complete the sale of its hydroelectric generation assets in the second quarter of 2018 at an amount above net carrying value, and are therefore stated at carrying value. As of March 31, 2018, the difference between the carrying value of the hydroelectric generation assets and the anticipated sale proceeds was approximately $23 million, which will be recognized as a reduction to stranded costs upon completion of the sale.

Full recovery of the costs of PSNH's generation assets and transaction-related expenses is expected to occur through a combination of cash flows during the remaining operating period, sales proceeds, and recovery of stranded costs primarily via the issuance of bonds that will be secured by a non-bypassable charge billed to PSNH's customers.

For the three months ended March 31, 2018, pre-tax income associated with the hydroelectric assets held for sale was $5.9 million. For the three months ended March 31, 2017, pre-tax income associated with PSNH's generation assets was $14.8 million.

As of March 31, 2018, PSNH's hydroelectric generation assets held for sale, which are included in current assets on the Eversource and PSNH balance sheets, and are part of the Electric Distribution reportable segment, were as follows:



(Millions of Dollars)
Hydroelectric Gross Plant	$	86.6
Accumulated Depreciation	(27.4		)
Net Plant	59.2
Materials and Supplies	0.1
Total Hydroelectric Generation Assets Held for Sale	$	59.3