-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, bcsH/l2FPRoqIysvvtUCm4r7xAB71hmjN1kobZZuPqDhtaTxXgjyVJkZ/RvEMpcw 5A9Fnmy9cb7+3KUogwwnOA== 0000071297-95-000034.txt : 19950502 0000071297-95-000034.hdr.sgml : 19950502 ACCESSION NUMBER: 0000071297-95-000034 CONFORMED SUBMISSION TYPE: U5S PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 19941231 FILED AS OF DATE: 19950501 SROS: BSE SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEW ENGLAND ELECTRIC SYSTEM CENTRAL INDEX KEY: 0000071297 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 041663060 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U5S SEC ACT: 1935 Act SEC FILE NUMBER: 001-03446 FILM NUMBER: 95533467 BUSINESS ADDRESS: STREET 1: 25 RESEARCH DR CITY: WESTBOROUGH STATE: MA ZIP: 01581 BUSINESS PHONE: 5083669011 U5S 1 File No. 30-33 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM U-5-S ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 1994 Filed pursuant to the Public Utility Holding Company Act of 1935 by LOGO NEW ENGLAND ELECTRIC SYSTEM 25 Research Drive, Westborough, Massachusetts 01582 Item 1. SYSTEM COMPANIES AND INVESTMENT THEREIN AS OF DECEMBER 31, 1994 (1)
Value Per Books of Percent of Issuer and Number of Voting Power Carrying Name of Company Common Shares (100% unless Value (and abbreviation used herein) Owned Specified) to Owner - ------------------------------ ------------- ------------ --------- (000's) New England Electric System (Voluntary Association) (NEES) None Granite State Electric Company (Granite) 60,400 $ 17,745 Massachusetts Electric Company (Mass Electric) 2,398,111 384,141 Nantucket Cable Electric Company, Inc. (Nantucket) (2) - None The Narragansett Electric Company (Narragansett) 1,132,487 208,181 Narragansett Energy Resources Company (NERC) 25 550 Unsecured Debt - 33,115 New England Electric Resources, Inc. (NEERI) 1,000 (640) Unsecured Debt - 1,474 New England Hydro-Transmission Electric Company, Inc. (NEHTEC) 2,017,352 53.97 33,973 New England Hydro-Transmission Corporation (NEHTC) 11,600 53.97 22,057 New England Electric Transmission Corporation (NEET) 165 4,321 New England Energy Incorporated (NEEI) (3) 2,500 (21,469) Unsecured debt - 18,298 New England Power Service Company (NEPSCO) 3 1,508 New England Power Company (NEP) 6,449,896 98.85 876,399 ---------- $1,579,653 ========== New England Hydro Finance Company (NEHFC) (4) 504 53.97 $ 5 NERC Ocean State Power (5) - 35.69 $ 21,164 Ocean State Power II (5) - 35.69 $ 16,711 NEP Connecticut Yankee Atomic Power Company 52,500 15 $ 15,075 Maine Yankee Atomic Power Company 100,000 20 $ 13,736 Vermont Yankee Nuclear Power Corporation 80,002 20 $ 10,571 Yankee Atomic Electric Company 46,020 30 $ 6,967 New England Wholesale Electric Company (6)* - -------------------- *Inactive.
(1) Attached as Exhibit E.2. hereto is a schedule showing investments during the year ended December 31, 1994 in the NEES Money Pool, through which certain System companies lend to or borrow from other System companies (Commission File Nos. 70-8043, 70-8261, and 70- 8453). (2) Nantucket was established April 7, 1994 under the laws of the Commonwealth of Massachusetts to design, permit, construct, operate, and maintain an undersea cable between Harwich and Nantucket Island in Massachusetts. Nantucket is not yet capitalized. (3) Samedan/NEEI Exploration Company is a partnership engaged in oil and gas exploration and development. NEEI owns a 50% interest in the partnership and had invested $715,142,142 in the partnership as of December 31, 1994. (4) NEHFC has two shareholders, NEHTEC and NEHTC, which each have a 50% interest. The tabulation shown above reflects NEES' indirect ownership in NEHFC. (5) Both Ocean State Power and Ocean State Power II are general partnerships; NERC owns a 20% equity interest in each. (6) Incorporated in 1972; not yet capitalized. Item 2. ACQUISITION OR SALES OF UTILITY ASSETS (None to be reported.) Item 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES (None to be reported.) Item 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES
Calendar Year 1994 ------------------ Name of Company Acquiring, Redeeming Number of Shares or Retiring or Principal Amount Commission Securities ------------------------ Authorization (Issuer unless Redeemed or (Release No. Name of Issuer otherwise noted) Acquired Retired (1)Consideration or Other) -------------- ---------------- -------- ---------------------------------------- GRANITE Unsecured Note $ 1,400,000 $ 1,400,000 23595 & 24272 NEHFC Secured Notes $ 11,520,000 $ 11,520,000 25304 NEEI Sub. Promissory Note NEES $ 1,890,815 $ 1,890,815 (A) Sub. Promissory Note $ 11,000,000 $ 11,000,000 (A) NEET Common Stock 15 shares$ 395,950 24162 Secured Note $ 4,624,000 $ 4,624,000 24162 NEERI Sub. Promissory Note NEES $ 1,209,000 $ 1,209,000 25621, 26017 & 26057 - -------------------- (1)Securities were extinguished. (A)SEC Release No 24847 and Rule 45(b)(3).
Item 5. INVESTMENTS IN SECURITIES OF NONSYSTEM COMPANIES As of December 31, 1994.
Number of Shares or General Principal Percent Nature Carrying Amount Voting of Issuer'sValue Name of Owner Name of Issuer Security Owned Owned Power Business to Owner - ------------- -------------- -------------- --------- ------- ---------------------- (in thous.) NEES UNITIL CorporationCapital Stock 34,400 shs. 0.8 Public $303 no par value Utility Three Two business Stocks $ 74 Subsidiaries development (A) corporations - -------------------- (A)Mass. Electric, Narragansett, and NEP.
Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994. (Note A)
Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- Andrew H. Aitken VP s - --------------------------------------------------------------------------------------------------------------------------------- John Amoroso 245 S. Main Street, Hopedale, MA VP s - --------------------------------------------------------------------------------------------------------------------------------- Lawrence E. Bailey VP s - --------------------------------------------------------------------------------------------------------------------------------- Thomas J. Bascetta RR 2, Box 44, Plainfield Rd., W. Lebanon, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Urville J. Beaumont 8 Samoset Dr., Salem, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Francis X. Beirne 4145 Quaker Lane, No. Kingstown, RI VP s - --------------------------------------------------------------------------------------------------------------------------------- Joan T. Bok D ChB D D D D D D D D f D D D D - --------------------------------------------------------------------------------------------------------------------------------- Marilyn R. Campbell 79 Brady Avenue, Salem, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Stephen A. Cardi 400 Lincoln Ave., Warwick, RI D f - --------------------------------------------------------------------------------------------------------------------------------- John G. Cochrane T T T VP s T T T T - --------------------------------------------------------------------------------------------------------------------------------- Eric P. Cody VP s - --------------------------------------------------------------------------------------------------------------------------------- Sally L. Collins 23 Ridgewood Terrace, Northampton, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Dan C. Delurey 601 Pennsylvania Ave., N.W., Suite 620-N, Washington, DC VP s - --------------------------------------------------------------------------------------------------------------------------------- Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994 (continued). (Note A) Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- John H. Dickson D P s - --------------------------------------------------------------------------------------------------------------------------------- Jeffrey A. Donahue VP VP s VP VP - --------------------------------------------------------------------------------------------------------------------------------- Richard W. Frost 280 Melrose Street, Providence, RI VP s - --------------------------------------------------------------------------------------------------------------------------------- Frances H. Gammell 200 Providence Street, W. Warwick, RI D f - --------------------------------------------------------------------------------------------------------------------------------- Peter H. Gibson VP s - --------------------------------------------------------------------------------------------------------------------------------- Don F. Goodwin VP s - --------------------------------------------------------------------------------------------------------------------------------- Frederic E. Greenman Sr-VP S D D D D VP D VP sD D D D - --------------------------------------------------------------------------------------------------------------------------------- Gregory A. Hale P.O. Box 60040, Florence Station, Northampton, MA VP s - --------------------------------------------------------------------------------------------------------------------------------- George W. Harris Ledge Road, Pelham, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Nicholas D. N. Harvey, Jr. 41 S. Park Street, Hanover, NH D f - --------------------------------------------------------------------------------------------------------------------------------- David L. Holt E-VP s - --------------------------------------------------------------------------------------------------------------------------------- Charles B. Housen 120 E. Main Street Erving, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Alfred D. Houston E-VP VP T D P D D D D P s D D D D - --------------------------------------------------------------------------------------------------------------------------------- Michael E. Jesanis T T T T s - --------------------------------------------------------------------------------------------------------------------------------- Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994 (continued). (Note A) Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- Paul L. Joskow 7 Chilton Street, Brookline, MAD f - --------------------------------------------------------------------------------------------------------------------------------- David C. Kennedy VP s - --------------------------------------------------------------------------------------------------------------------------------- Joseph J. Kirby 23 Broad Street, Westerly, RI D f - --------------------------------------------------------------------------------------------------------------------------------- John M. Kucharski 45 William Street, Wellesley, MAD f - --------------------------------------------------------------------------------------------------------------------------------- Edward H. Ladd 125 Claybrook Rd., Dover, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Cheryl A. LaFleur VP s - --------------------------------------------------------------------------------------------------------------------------------- John L. Levett D P s - --------------------------------------------------------------------------------------------------------------------------------- James V. Mahoney 280 Melrose St., Providence, RI VP s - --------------------------------------------------------------------------------------------------------------------------------- John F. Malley VP s - --------------------------------------------------------------------------------------------------------------------------------- Paul R. Marshall 1101 Turnpike St., No. Andover, MA S s S S - --------------------------------------------------------------------------------------------------------------------------------- Robert L. McCabe 280 Melrose Street, Providence, RI D P s - --------------------------------------------------------------------------------------------------------------------------------- Kathryn A. McCarthy 1580 Massachusetts Avenue, Apt. 5D, Cambridge, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Joshua A. McClure P.O. Box 1119, Westerly, RI D f - --------------------------------------------------------------------------------------------------------------------------------- Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994 (continued). (Note A) Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- Howard W. McDowell D T Co Co Co Co Co s Co Co Co Co - --------------------------------------------------------------------------------------------------------------------------------- Patricia McGovern 400 Atlantic Avenue Boston, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Malcolm McLane One Eagle Sq., Concord, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Robert H. McLaren VP s - --------------------------------------------------------------------------------------------------------------------------------- Felix A. Mirando, Jr. 315 S. Lake Drive Palm Beach, FL D f - --------------------------------------------------------------------------------------------------------------------------------- Howard R. Mortenson P.O. Box 885 Charlestown, NH D f - --------------------------------------------------------------------------------------------------------------------------------- Charles H. Moser VP s - --------------------------------------------------------------------------------------------------------------------------------- Richard Nadeau 280 Melrose Street Providence, RI VP s - --------------------------------------------------------------------------------------------------------------------------------- John W. Newsham VP D E-VP D D s P D - --------------------------------------------------------------------------------------------------------------------------------- Chester O. Paradise VP s - --------------------------------------------------------------------------------------------------------------------------------- Lydia M. Pastuszek 1101 Turnpike St., No. Andover, MA P D s VP - --------------------------------------------------------------------------------------------------------------------------------- Anthony C. Pini VP s - --------------------------------------------------------------------------------------------------------------------------------- Kirk L. Ramsauer C s C C - --------------------------------------------------------------------------------------------------------------------------------- John F. Reilly 1 Merrimack Plaza, Lowell, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994 (continued). (Note A) Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- Lawrence J. Reilly VP s - --------------------------------------------------------------------------------------------------------------------------------- Thomas G. Robinson S s - --------------------------------------------------------------------------------------------------------------------------------- John W. Rowe P D D D Ch D D D Ch D Ch D sD D D D - --------------------------------------------------------------------------------------------------------------------------------- Michael Ryan 280 Melrose Street Providence, RI VP s - --------------------------------------------------------------------------------------------------------------------------------- George M. Sage P.O. Box 9527, Providence, RID f - --------------------------------------------------------------------------------------------------------------------------------- Nancy H. Sala 939 Southbridge St., Worcester, MA VP s - --------------------------------------------------------------------------------------------------------------------------------- Richard P. Sergel VP Ch D Ch D Ch D D D s - --------------------------------------------------------------------------------------------------------------------------------- Richard M. Shribman 101 Washington Street, Salem, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Dennis E. Snay 170 Medford St., Malden, MA VP s - --------------------------------------------------------------------------------------------------------------------------------- Charles E. Soule 18 Chestnut Street, Worcester, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Jeffrey D. Tranen VP VP D D P D P D D s P D P D D P D - --------------------------------------------------------------------------------------------------------------------------------- William E. Trueheart Box 49, Bryant College, Smithfield, RI D f - --------------------------------------------------------------------------------------------------------------------------------- Arnold H. Turner VP VP s VP VP VP - --------------------------------------------------------------------------------------------------------------------------------- Jeffrey W. VanSant VP VP s - --------------------------------------------------------------------------------------------------------------------------------- Item 6. OFFICERS AND DIRECTORS Part I. As of December 31, 1994 (continued). (Note A) Mass NEES Granite Elec NARRANEEI NEERI NEET NEP NEPSCONEHTC NEHTEC NERC NEHFC ---- ------- ---- --------- ----- ---- --- ----------- ------ ---- ----- William Watkins, Jr. 280 Melrose Street, Providence, RI E-VP s - --------------------------------------------------------------------------------------------------------------------------------- Roslyn M. Watson 25 Braddock Park, Boston, MA D f - --------------------------------------------------------------------------------------------------------------------------------- Anne Wexler 1317 F Street, N.W., Washington, DC D f - --------------------------------------------------------------------------------------------------------------------------------- John A. Wilson, Jr. 49 Madison Ave., No. Kingston, RI D f - --------------------------------------------------------------------------------------------------------------------------------- James Q. Wilson 32910 Camino de Buena Ventura, Malibu, CA D f - --------------------------------------------------------------------------------------------------------------------------------- James R. Winoker 222 Richmond Street Providence, RI D f - --------------------------------------------------------------------------------------------------------------------------------- Robert King Wulff C C S C s S - --------------------------------------------------------------------------------------------------------------------------------- Geraldine M. Zipser C s - --------------------------------------------------------------------------------------------------------------------------------- Key: Ch-Chairman; ChB-Chairman of the Board; VCh-Vice Chairman; D-Director; P-President; E-VP-Executive Vice President; Sr-VP-Senior Vice President; VP-F-Vice President--Finance; VP-Vice President; T-Treasurer; Co-Controller; C-Clerk; S-Secretary; s-Salary; f-Fee. Note A:Address is 25 Research Drive, Westborough, Massachusetts 01582 unless otherwise indicated.
Item 6. OFFICERS AND DIRECTORS Part II. Financial Connections as of December 31, 1994. Position Name and Held in Name of Location of Financial Applicable Officer or Financial InstitutionExemption Director Institution (a) Rule ---------- ----------- --------------------- George W. Harris Pelham Bank & Trust Co., D d Pelham, NH Joseph J. Kirby The Washington Trust Co., P, D d Westerly, RI The Washington Trust Bancorp, Inc., Westerly, RI P d John M. Kucharski State Street Boston Corp., D b Boston, MA Robert L. McCabe Citizen Savings Bank, D d,g Providence, RI John F. Reilly Family Bank, D d Haverhill, MA John W. Rowe First National Bank of Boston,D b,d,e,f,g Boston, MA Bank of Boston Corporation, D b,d,e,f,g Boston, MA Richard M. Shribman Eastern Bank Corporation, T d Lynn, MA Eastern Bank, D d Lynn, MA William E. TrueheartFleet National Bank, D d Providence, RI Fleet Bank, N.A., D e Hartford, CT Fleet Bank of Massachusetts,D e N.A., Boston, MA William Watkins, Jr.Rhode Island Hospital Trust D g National Bank, Providence, RI Roslyn M. Watson The Dreyfus Laurel Funds, T e New York, NY American Express Centurion D e Bank, Wilmington, DE - -------------------- a - D-Director; P-President; T-Trustee b - Rule 70(a) c - Rule 70(b) d - Rule 70(c) e - Rule 70(d) f - Rule 70(e) g - Rule 70(f) Item 6. OFFICERS AND DIRECTORS Part III. Disclosures made in proxy statements and annual reports on Form 10-K, filed in 1995, follow: NEES Summary Compensation Table ------------------------------- Long-Term Compen- Annual Compensation (b) sation ----------------------- --------- Other Annual Restricted Name and Compensa- Share All Other Principal Salary Bonus tion Awards Compensa- Position (a)Year ($) ($)(c) ($)(d) ($)(e) tion ($)(f) - ---------------- ------ ------ --------- ---------- ----------- John W. Rowe1994 501,156 284,540 9,517 160,974 4,526 (g) President 1993 433,908 268,323 5,548 129,873 5,711 and Chief 1992 433,908 162,728 5,451 132,804 5,503 Executive Officer Alfred D. 1994 244,860 132,370 5,501 62,040 4,027 (h) Houston 1993 212,904 152,939 3,522 44,465 5,082 Executive 1992 212,904 82,816 3,494 44,607 5,029 Vice President Frederic E. 1994 219,288 139,475 5,671 53,427 4,238 (i) Greenman 1993 212,904 129,239 3,670 39,276 5,355 Senior Vice 1992 203,112 76,624 3,599 41,103 5,028 President and Secretary Jeffrey D. 1994 187,356 98,357 5,049 45,804 3,466 (j) Tranen 1993 175,330 122,896 3,260 35,906 3,906 Vice 1992 157,890 68,316 2,684 31,007 3,818 President John W. 1994 182,484 107,432 5,629 38,544 4,293 (k) Newsham 1993 173,520 120,494 3,116 29,808 4,283 Vice 1992 163,170 67,063 2,657 29,952 3,932 President ____________________ (a) Officers of NEES also hold various positions with subsidiary companies. Compensation for these positions is included in this table. (b) Includes deferred compensation in category and year earned. (c) The bonus figure represents cash bonuses under an incentive compensation plan, special bonuses, the goals program award, and the variable portion of the incentive thrift plan match by NEES. See description under Plan Summaries. (d) Includes amounts reimbursed by NEES for the payment of taxes. (e) Prior to the awards made for 1994, shares were awarded that became unrestricted after five years. Those shares receive the same dividends as the other common shares of NEES. The awards made for 1994 were in the form of deferred incentive shares, which have been deferred for receipt for at least five years or, in some cases, until the later of five years or termination of employment. At the end of the deferred period, the award may be paid out in shares or 50% in shares and 50% in cash. As cash dividends are declared, the number of deferred incentive shares will be increased as if the dividends were reinvested in shares. See also Payments Upon a Change in Control below. As of December 31, 1994, the following executive officers held the amount of restricted shares with the value indicated: Mr. Rowe 15,236 shares, $489,457 value; Mr. Houston 4,425 shares, $142,153 value; Mr. Greenman 4,257 shares, $136,756 value; Mr. Tranen 3,121 shares, $100,262 value; and Mr. Newsham 2,888 shares, $92,777 value. The value was calculated by multiplying the closing market price on December 30, 1994, by the number of shares. (f) Includes NEES contributions to life insurance and the incentive thrift plan that are not bonus contributions. See description under Plan Summaries. The life insurance contribution is calculated based on the value of term life insurance for the named individuals. The premium costs for most of these policies have been or will be recovered by NEES. (g) For Mr. Rowe, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $1,526 for life insurance. (h) For Mr. Houston, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $1,027 for life insurance. (i) For Mr. Greenman, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $1,238 for life insurance. (j) For Mr. Tranen, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $466 for life insurance. (k) For Mr. Newsham, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $1,293 for life insurance. NEP Summary Compensation Table ------------------------------ Long-Term Compensa- Annual Compensation (b) tion ----------------------------------- Other Annual Restricted All Other Name and Compensa- Share Compensa- Principal Salary Bonus tion Awards tion Position (a)Year ($) ($)(c) ($)(d) ($)(e) ($)(f) - ---------------- ------- ------ --------- ---------- --------- John W. Rowe1994 211,598 119,716 4,018 67,966 1,911 (g) Chairman 1993 181,269 112,095 2,318 54,256 2,386 1992 184,532 69,205 2,318 56,479 2,340 Jeffrey D. 1994 187,356 98,357 5,049 45,804 3,466 (h) Tranen 1993 159,936 112,105 2,974 32,753 3,563 President 1992 120,843 52,286 2,307 23,732 2,670 John W. 1994 134,518 79,087 4,149 28,413 3,165 (i) Newsham 1993 112,460 78,093 2,020 19,319 2,776 Executive 1992 105,602 43,402 1,718 19,385 2,545 Vice President Frederic E. 1994 140,070 89,090 3,622 34,126 2,707 (j) Greenman 1993 123,648 75,058 2,131 22,811 3,110 Vice 1992 133,223 50,258 2,361 26,960 3,298 President Lawrence E. 1994 140,471 66,510 116 27,484 3,952 (k) Bailey 1993 135,123 61,283 101 21,286 3,790 Vice 1992 129,711 47,737 101 20,985 2,594 President ____________________ (a) Certain officers of NEP are also officers of NEES and various other System companies. (b) Includes deferred compensation in category and year earned. (c) The bonus figure represents cash bonuses under an incentive compensation plan, special bonuses, the goals program award, and the variable portion of the incentive thrift plan match by NEP. See description under Plan Summaries. (d) Includes amounts reimbursed by NEP for the payment of taxes. (e) Prior to the awards made for 1994, shares were awarded that became unrestricted after five years. Those shares receive the same dividends as the other common shares of NEES. The awards made for 1994 were in the form of deferred incentive shares, which have been deferred for receipt for at least five years or, in some cases, until the later of five years or termination of employment. At the end of the deferred period, the award may be paid out in shares of 50% in shares and 50% in cash. As cash dividends are declared, the number of deferred incentive shares will be increased as if the dividends were reinvested in shares. See also Payments Upon a Change in Control, below. As of December 31, 1994, the following executive officers held the amount of restricted shares with the value indicated: Mr. Rowe 15,236 shares, $489,457 value; Mr. Tranen 3,121 shares, $100,262 value; Mr. Newsham 2,888 shares, $92,777 value; Mr. Greenman 4,257 shares, $136,756 value; and Mr. Bailey 1,931 shares, $62,033 value. These amounts do not include the restricted share awards for 1994 which were not determined until February 1995. The value was calculated by multiplying the closing market price on December 31, 1994 by the number of shares. (f) Includes NEP contributions to life insurance and the incentive thrift plan that are not bonus contributions. See description under Plan Summaries. The life insurance contribution is calculated based on the value of term life insurance for the named individuals. The premium costs for most of these policies have been or will be recovered by NEP. (g) For Mr. Rowe, the amount and type of compensation in 1994 is as follows: $1,267 for contributions to the thrift plan and $644 for life insurance. (h) For Mr. Tranen, the amount and type of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $466 for life insurance. (i) For Mr. Newsham, the amount and type of compensation in 1994 is as follows: $2,212 for contributions to the thrift plan and $953 for life insurance. (j) For Mr. Greenman, the amount and type of compensation in 1994 is as follows: $1,916 for contributions to the thrift plan and $791 for life insurance. (k) For Mr. Bailey, the amount and type of compensation in 1994 is as follows: $2,809 for contributions to the thrift plan and $1,143 for life insurance. Mass. Electric Summary Compensation Table ----------------------------------------- Long-Term Compensa- Annual Compensation (b) tion ----------------------------------- Other Annual Restricted All Other Name and Compensa- Share Compensa- Principal Salary Bonus tion Awards tion Position (a)Year ($) ($)(c) ($)(d) ($)(e) ($)(f) - ---------------- ------- ------ --------- ---------- --------- Richard P. 1994 113,021 63,550 3,307 29,731 2,228 (h) Sergel (g) 1993 93,628 71,187 1,657 20,713 2,036 Chairman John H. 1994 161,604 82,956 5,105 34,617 3,536 (i) Dickson 1993 156,900 116,399 3,005 28,103 3,623 President 1992 150,469 61,561 3,087 27,801 3,442 David L. 1994 95,122 55,347 102 22,973 2,552 (j) Holt (g) 1993 60,782 39,166 51 11,476 1,352 Executive Vice President Anthony C. 1994 105,884 43,465 116 17,688 2,454 (k) Pini (g) 1993 71,457 27,761 81 7,996 1,653 Vice President Nancy H. 1994 107,621 39,318 116 16,129 2,493 (l) Sala 1993 102,860 43,386 103 13,370 2,378 Vice 1992 96,785 20,508 103 8,326 1,936 President ____________________ (a) Certain officers of Mass. Electric are also officers of NEES and various other System companies. (b) Includes deferred compensation in category and year earned. (c) The bonus figure represents cash bonuses under an incentive compensation plan, special bonuses, the goals program award, and the variable portion of the incentive thrift plan match by Mass. Electric. See description under Plan Summaries. (d) Includes amounts reimbursed by Mass. Electric for the payment of taxes. (e) Prior to the awards made for 1994, shares were awarded that became unrestricted after five years. Those shares receive the same dividends as the other common shares of NEES. The awards made for 1994 were in the form of deferred incentive shares, which have been deferred for receipt for at least five years or, in some cases, until the later of five years or termination of employment. At the end of the deferred period, the award may be paid out in shares of 50% in shares and 50% in cash. As cash dividends are declared, the number of deferred incentive shares will be increased as if the dividends were reinvested in shares. See also Payments Upon a Change in Control, below. As of December 31, 1994, the following executive officers held the amount of restricted shares with the value indicated: Mr. Sergel 2,941 shares, $94,480 value; Mr. Dickson 2,932 shares, $94,191 value; Mr. Holt 2,123 shares, $68,201 value; Mr. Pini 1,402 shares, $45,039 value; and Ms. Sala 713 shares, $22,905 value. These amounts do not include the restricted share awards for 1994 which were not determined until February 1995. The value was calculated by multiplying the closing market price on December 31, 1994 by the number of shares. (f) Includes Mass. Electric contributions to life insurance and the incentive thrift plan that are not bonus contributions. See description under Plan Summaries. The life insurance contribution is calculated based on the value of term life insurance for the named individuals. The premium costs for most of these policies have been or will be recovered by Mass. Electric. (g) Mr. Sergel, Mr. Holt, and Mr. Pini were elected as officers of Mass. Electric in 1993. Compensation data is provided for the years in which they have served as officers. (h) For Mr. Sergel, the type and amount of compensation in 1994 is as follows: $2,011 for contributions to the thrift plan and $217 for life insurance. (i) For Mr. Dickson, the type and amount of compensation in 1994 is as follows: $3,000 for contributions to the thrift plan and $536 for life insurance. (j) For Mr. Holt, the type and amount of compensation in 1994 is as follows: $1,902 for contributions to the thrift plan and $650 for life insurance. (k) For Mr. Pini, the type and amount of compensation in 1994 is as follows: $2,118 for contributions to the thrift plan and $336 for life insurance. (l) For Ms. Sala, the type and amount of compensation in 1994 is as follows: $2,152 for contributions to the thrift plan and $341 for life insurance. Narragansett Summary Compensation Table --------------------------------------- Long-Term Compensa- Annual Compensation (b) tion ----------------------------------- Other Annual Restricted All Other Name and Compensa- Share Compensa- Principal Salary Bonus tion Awards tion Position (a)Year ($) ($)(c) ($)(d) ($)(e) ($)(f) - ---------------- ------- ------ --------- ---------- --------- Richard P. 1994 50,319 28,293 1,472 13,237 992 (h) Sergel (g) 1993 48,207 36,653 854 10,665 1,048 Chairman Robert L. 1994 140,785 68,784 4,457 28,576 4,256 (i) McCabe 1993 139,632 98,654 2,408 22,617 3,771 President 1992 134,536 54,109 2,041 25,076 2,603 William 1994 124,428 62,799 115 26,136 6,186 (j) Watkins, 1993 118,501 39,403 101 13,370 5,847 Jr. 1992 65,586 17,315 66 7,350 1,312 Executive Vice President James V. 1994 124,428 71,567 115 23,463 2,950 (k) Mahoney (g) 1993 58,426 21,563 50 8,957 1,252 Vice President Richard W. 1994 99,300 34,269 115 13,629 2,706 (l) Frost (g) 1993 96,408 28,667 103 11,211 2,628 Vice President ____________________ (a) Certain officers of Narragansett are also officers of NEES and various other System companies. (b) Includes deferred compensation in category and year earned. (c) The bonus figure represents cash bonuses under an incentive compensation plan, special bonuses, the goals program award, and the variable portion of the incentive thrift plan match by Narragansett. See description under Plan Summaries. (d) Includes amounts reimbursed by Narragansett for the payment of taxes. (e) Prior to the awards made for 1994, shares were awarded that became unrestricted after five years. Those shares receive the same dividends as the other common shares of NEES. The awards made for 1994 were in the form of deferred incentive shares, which have been deferred for receipt for at least five years or, in some cases, until the later of five years or termination of employment. At the end of the deferred period, the award may be paid out in shares of 50% in shares and 50% in cash. As cash dividends are declared, the number of deferred incentive shares will be increased as if the dividends were reinvested in shares. See also Payments Upon a Change in Control, below. As of December 31, 1994, the following executive officers held the amount of restricted shares with the value indicated: Mr. Sergel 2,941 shares, $94,480 value; Mr. McCabe 2,753 shares, $88,440 value; Mr. Watkins 1,307 shares, $41,987 value; Mr. Mahoney 2,107 shares, $67,687 value; and Mr. Frost 1,238 shares, $39,771 value. These amounts do not include the restricted share awards for 1994 which were not determined until February 1995. The value was calculated by multiplying the closing market price on December 31, 1994 by the number of shares. (f) Includes Narragansett contributions to life insurance and the incentive thrift plan that are not bonus contributions. See description under Plan Summaries. The life insurance contribution is calculated based on the value of term life insurance for the named individuals. The premium costs for most of these policies have been or will be recovered by Narragansett. (g) Messrs. Sergel, Mahoney, and Frost, were elected as officers of Narragansett in 1993. Compensation data is provided for the years in which they have served as officers. (h) For Mr. Sergel, the type and amount of compensation in 1994 is as follows: $895 for contributions to the thrift plan and $97 for life insurance. (i) For Mr. McCabe, the type and amount of compensation in 1994 is as follows: $2,613 for contributions to the thrift plan and $1,643 for life insurance. (j) For Mr. Watkins, the type and amount of compensation in 1994 is as follows: $2,488 for contributions to the thrift plan and $3,698 for life insurance. (k) For Mr. Mahoney, the type and amount of compensation in 1994 is as follows: $2,247 for contributions to the thrift plan and $703 for life insurance. (l) For Mr. Frost, the type and amount of compensation in 1994 is as follows: $1,986 for contributions to the thrift plan and $720 for life insurance. Security Ownership ------------------ The following table lists the holdings of NEES common shares as of March 9, 1995 by NEES, NEP, Mass. Electric, and Narragansett directors, the executive officers named in the Summary Compensation Tables, and all directors and executive officers, as a group. Shares Deferred Beneficially Incentive Name Owned (a) Shares (b) ---- ------------ ---------- Joan T. Bok 26,053 Frederic E. Greenman 11,284 1,619 Alfred D. Houston 11,653 1,880 Paul L. Joskow 1,941 John M. Kucharski 2,000 Edward H. Ladd 4,506 Joshua A. McClure 1,268 John W. Newsham 11,084 1,168 John W. Rowe 19,598 4,878 George M. Sage 1,900 Charles E. Soule 618 Jeffrey D. Tranen 7,053 1,388 Anne Wexler 1,404 James Q. Wilson 2,113 James R. Winoker 1,000 Urville J. Beaumont 163 (c) Sally L. Collins 165 John H. Dickson 8,831 1,049 David L. Holt 5,703 789 Charles B. Housen 208 Patricia McGovern 51 Anthony C. Pini 7,395 536 John F. Reilly 165 Nancy H. Sala 6,258 (d) 489 Richard P. Sergel 7,322 1,344 Richard M. Shribman 165 Roslyn M. Watson 265 Stephen A. Cardi 164 Richard W. Frost 5,029 413 Frances H. Gammell 165 Joseph J. Kirby 165 James V. Mahoney 3,560 711 Robert L. McCabe 8,341 994 William E. Trueheart 165 William Watkins, Jr. 4,853 792 John A. Wilson, Jr. 558 Lawrence E. Bailey 4,761 833 All directors and executive officers, as a group (54 persons) 236,111 (e) 25,679 (e) - -------------------- (a) Number of shares beneficially owned includes: (i) shares directly owned by certain relatives with whom directors or officers share voting or investment power; (ii) shares held of record individually by a director or officer or jointly with others or held in the name of a bank, broker, or nominee for such individual's account; (iii) shares in which certain directors or officers maintain exclusive or shared investment or voting power whether or not the securities are held for their benefit; and (iv) with respect to the executive officers, allocated shares in the Incentive Thrift Plan described below. (b) Deferred incentive shares represent the award of shares under the Incentive Share Plan, described below, which have been deferred for receipt until March 15, 2000, or, in some cases, the later of March 15, 2000 or termination of employment. At the end of the deferred period, the award may be paid out in shares or 50% in shares and 50% in cash. While deferred, the shares do not have voting rights or other rights associated with ownership. The rights of the executives to payment are those of general, unsecured creditors. As cash dividends are declared, the number of deferred incentive shares will be increased as if the dividends were reinvested in shares. (c) Mr. Beaumont disclaims a beneficial ownership interest in 100 of these shares held under an irrevocable trust. (d) Ms. Sala disclaims a beneficial ownership interest in 232 shares held under the Uniform Gift to Minors Act. (e) Total amount is less than 1% of the total number of shares of NEES outstanding. Listed below is the only person or group known to the System as of March 9, 1995 to beneficially own 5% or more of NEES common shares. However, T. Rowe Price Trust Company disclaims beneficial ownership of all such shares. The quantity of shares listed below is as of December 31, 1994. Amount and Nature Name and Address of of Beneficial Percent of Common Beneficial Owner Ownership Shares ------------------- ----------------- ----------------- T. Rowe Price Trust 5,215,252 shares 8.0 % Company as trustee for 100 East Pratt StreetCompany employee Baltimore, MD 21202 benefit plans, including those discussed herein. Contracts and Transactions with System Companies ------------------------------------------------ During 1994, Mr. Joskow did consulting work for NEES or subsidiaries of NEES under a separate consulting contract for which he was paid $30,000. These consulting services were not related to his duties as a Board member. NEES and its subsidiaries retain from time to time National Economic Research Associates, Inc. (NERA). During 1994, subsidiaries of NEES paid NERA approximately $61,500 to prepare testimony and reports on regulatory matters. Mr. Joskow is a special consultant to NERA. Mrs. Bok serves as a consultant to NEES. Under the terms of her contract, she receives an annual retainer of $100,000. Mrs. Bok also serves as a director for each of NEES' subsidiaries. She has agreed to waive the normal fees and annual retainers otherwise payable for services by non-employees on these boards and receives in lieu thereof a single annual stipend of $60,000. The construction company of Mr. Stephen A. Cardi, a director of Narragansett, was paid $335,000 in 1994 pursuant to two contracts with New England Power Company for construction work at its Brayton Point Station. The contract amounts totalled $600,000 and $1,000,000, respectively. Plan Summaries -------------- A brief description of the various plans through which compensation and benefits are provided to the named executive officers is presented below to better enable shareholders to understand the information presented in the tables shown earlier. The general provisions of the incentive compensation plans are described in the NEES Compensation Committee Report on Executive Compensation. The amounts of compensation and benefits provided to the named executive officers under the plans described below (and charged to the System Companies listed in the above tables) are presented in the Summary Compensation Tables. Goals Program - ------------- The goals program covers all employees who have completed one year of service with any NEES subsidiary. Goals are established annually. For 1994, these goals related to earnings per share, customer costs, safety, absenteeism, conservation, generating station availability, transmission reliability, environmental and OSHA compliance, and customer favorability attitudes. Some goals apply to all employees, while others apply to particular functional groups. Depending upon the number of goals met, and provided the minimum earnings goal is met, employees may earn a cash bonus of 1% to 4-1/2% of their compensation. Incentive Thrift Plan - --------------------- The incentive thrift plan (a 401(k) program) provides for a match of one- half of up to the first 5% of base compensation contributed to the System's incentive thrift plan (shown under All Other Compensation in the Summary Compensation Tables) and, based on an incentive formula tied to earnings per share, may fully match the first 5% of base compensation contributed (the additional amount, if any, is shown under Bonus in the Summary Compensation Tables). Under Federal law, contributions to these plans are limited. In 1994, the salary reduction amount was limited to $9,240. Life Insurance - -------------- NEES has established for certain senior executives life insurance plans funded by individual policies. The combined death benefit under these insurance plans is three times the participant's annual salary. After termination of employment, participants in one of the insurance plans may elect, commencing at age 55 or later, to receive an annuity income equal to 40% of annual salary. In that event, the life insurance is reduced over fifteen years to an amount equal to the participant's final annual salary. Due to changes in the tax law, this plan was closed to new participants, and an alternative was established with only a life insurance benefit. The individuals listed in the NEP summary compensation table are in one or the other of these plans. These plans are structured so that, over time, the System should recover the cost of the insurance premiums. Mass. Electric and Narragansett each have two executive officers eligible to participate in one or the other of these plans. Financial Counseling - -------------------- NEP, Mass. Electric, and Narragansett pay for personal financial counseling for senior executives. As required by the IRS, a portion of the amount paid is reported as taxable income for the executive. Financial counseling is also offered to other employees through a limited number of seminars conducted at various locations each year. Other - ----- The System does not have any share option plans. Retirement Plans - ---------------- The following chart shows estimated annual benefits payable to executive officers under the qualified pension plan and the supplemental retirement plan, assuming retirement at age 65 in 1995. Pension Table ------------- Five-Year Average 15 20 25 30 35 40 Compensa- Years Years Years Years Years Years tion Service Service Service Service Service Service - --------- ------- ------- ------- ------- ------- ------- $300,000 87,900 115,200 141,800 168,400 185,200 194,200 $400,000118,000 154,600 190,300 226,000 248,600 260,600 $500,000148,000 194,000 238,800 283,600 312,100 327,100 $600,000178,100 233,400 287,300 341,200 375,500 393,500 $700,000208,100 272,800 335,800 398,800 439,000 460,000 $800,000238,200 312,400 384,500 456,600 502,800 526,800 $900,000268,200 351,600 432,800 514,000 565,900 592,900 $1,000,000298,300 391,000 481,300 571,600 629,300 659,300 $1,100,000328,300 430,400 529,800 629,200 692,800 725,800 For purposes of the retirement plans, Messrs. Rowe, Houston, Greenman, Tranen, and Newsham, currently have 17, 32, 30, 25, and 44 credited years of service, respectively. Mr. Sergel, Mr. Dickson, Mr. Holt, Mr. Pini, and Ms. Sala currently have 16, 21, 23, 16, and 25 credited years of service, respectively. Messrs. McCabe, Watkins, Mahoney, and Frost currently have 26, 22, 11, and 32 credited years of service, respectively. Mr. Bailey currently has 26 credited years of service. Benefits under the pension plans are computed using formulae based on percentages of highest average compensation computed over five consecutive years. The compensation covered by the pension plan includes salary, bonus, and restricted share awards. The benefits listed in the pension table are not subject to deduction for Social Security and are shown without any joint and survivor benefits. The Pension Table above does not include annuity payments to be received in lieu of life insurance for Messrs. Rowe, Houston, and Greenman. The policies are described below under Plan Summaries. In the year in which Mr. Newsham retires, he will receive a one-time supplemental cash payment. The amount of the payment would be $120,000 if he were to retire in 1995, and would be reduced by $30,000 per year thereafter. Under the Retirement Supplement Plan, participants receive a limited cost of living (consumer price index) adjustment to their pension benefits. There are no active employees currently in the plan. The System contributes the full amount toward post-retirement health benefits for senior executives. Payments Upon a Change of Control - --------------------------------- NEES has approved agreements with certain of its executives, including Messrs. Greenman, Houston, Newsham, Rowe, Sergel, and Tranen, which provide severance benefits in the event of certain terminations of employment following a Change in Control of NEES (as defined below). If, following a Change in Control, the executive's employment is terminated other than for cause (as defined) or if the executive terminates employment for good reason (as defined), NEES will pay to the executive a lump sum cash payment equal to three times (two times for some executives) the sum of the executive's most recent annual base compensation and the average of his or her bonus amounts for the prior three years. If Mr. Rowe receives payments under his severance agreement that would subject him to any federal excise tax due under section 280G of the Internal Revenue Code, he will receive a cash "gross-up" payment so he would be in the same net after-tax position he would have been in had such excise tax not been applied. In addition, NEES will provide disability and health benefits to the executive for two to three years, provide such post-retirement health and welfare benefits as the executive would have earned within such two to three years, and grant two or three additional years of pension credit. Mr. Rowe would become eligible for benefits under the Retirement Supplement Plan described above. Change in Control, including potential change of control, occurs (1) when any person becomes the beneficial owner of 20% of the voting securities of NEES, (2) when the prior members of the Board of NEES no longer constitute a 2/3 majority of the Board, or (3) NEES enters into an agreement that could result in a Change in Control. The terms of the agreements are for three years with automatic annual extensions, unless terminated by NEES. The System's bonus plans, including the Incentive Thrift Plan, and the Goals Program, are being amended to provide for payments equal to the average of the bonuses for the three prior years in the event of a Change of Control. This payment would be made in lieu of the regular bonuses for the year in which the Change in Control occurs. The System's Retirees Health and Life Insurance Plan I has provisions preventing changes in benefits adverse to the participants for three years following a Change in Control. The Incentive Share Plan and the related Incentive Share Deferral Agreements provide that, upon the occurrence of a change in control (defined more narrowly than in other plans), restrictions on all shares and account balances would cease. New England Electric System Compensation Committee Report on Executive Compensation - ------------------------------------------ The System's total compensation package is designed to attract and retain an array of superior managers who can successfully lead the System as the industry becomes increasingly competitive and whose experience is not necessarily limited to our System or industry. This package consists of Base Salary, Incentive Compensation (performance based, at risk compensation), and Benefits. The Committee periodically reviews each component of the System's executive compensation program to ensure that pay levels and incentive opportunities are competitive and that incentive opportunities are linked to System performance. The System's general compensation philosophy is that the Base Salary ranges should be competitive. A significant portion of management compensation should be tied to achievement of corporate goals in order to maintain a sharp focus on performance and to consistently align the interest of management and the System's shareholders and customers. An ever higher percentage of total compensation should be at risk as one moves upward through management. The critical feature of the System's executive compensation program is that a system has been employed in which the amount of such compensation is driven by the System's performance relative to that of other utilities. The compensation of Mr. Rowe, the Chief Executive Officer, is based on the same considerations and structure as that of the other executive officers. (Since the compensation for each of the System's executive officers is still below the $1 million threshold at which tax deductions are limited under the recent revisions to the Internal Revenue Code, the Committee has not had to address issues related thereto but continues to monitor them.) The NEES Board of Directors votes the compensation of Mr. Rowe, acting upon recommendations of the NEES Compensation Committee. The Compensation Committee is described on page 28. The Board of Directors unanimously accepted each of the recommendations made by the Compensation Committee in 1994. The Compensation Committee votes the compensation of all other System executive officers. Although System management may be present during Committee discussions of officers' compensation, Committee decisions with respect to the compensation of Mr. Rowe are reached in private session without the presence of any member of System management. At several meetings during the year, the Committee discussed the change in the nature and structure of the electric utility industry. Like most companies operating in an environment where merger and acquisition activity may take place, the Committee wished to encourage and enforce the continued attention of senior management to their assigned duties without distraction in the face of the possibility of a change in control or merger. Therefore, the Compensation Committee recommended adoption of severance arrangements (described on page 25) for the System's officers. The Board of Directors unanimously accepted this recommendation. Base Salary - ----------- Base Salary levels are established after consideration of the appropriate market to determine the average salary for a position. Extensive salary survey analyses are compiled annually and presented to the Committee for review. Salary ranges are then defined on the basis of those market surveys. These surveys may include some of the same companies included in incentive compensation plan comparisons or in the corporate performance chart. In February 1994, the Compensation Committee reviewed executive compensation surveys for public utilities and industry in general prepared by an industry group and by benefit consultants. The Committee also discussed the increased scope of Mr. Rowe's position following the retirement of Joan T. Bok as an employee. The Committee also considered the System's superior returns on equity, coupled with low rates, and the focus on asset quality and cost control. The Committee recommended a base 1994 salary for Mr. Rowe of $512,000. In November 1994, the Committee reviewed multiple surveys prepared by various consulting organizations and industry groups. The Committee compared Mr. Rowe's salary with that paid for positions in similarly sized utilities and non-manufacturing companies. The Committee noted the System's performance under Mr. Rowe's leadership compared to the objective, key financial goals, such as return on equity, used for several years to judge System corporate performance. The Committee recommended the base salary for Mr. Rowe be set at $537,600 for 1995. Over several meetings in 1994, the Committee considered the nature of the System's compensation program and its ability to properly reward individuals in the increasingly competitive world that electric utilities are entering. At the November meeting, the Committee considered data from multiple national and regional executive compensation surveys on expected structure movement in 1995. The Committee determined to adopt a 3% general increase in the executive compensation structure, and to collapse the existing 14-grade system for executive compensation to a five-level system. This will provide greater discretion than in the past within each of the salary levels, enabling the Committee to more closely recognize individual responsibilities and achievement. This change also eliminated an existing mid-point restriction in the incentive compensation plans. The Committee then reviewed the performance of each individual in the compensation group below Mr. Rowe, the relative position of these individuals compared to the market surveys discussed above, and the Committee's subjective analysis of the performance of those individuals. The Committee adopted salary recommendations and, after considering the particular services of Messrs. Greenman and Newsham, voted special bonuses for those individuals. These bonuses are reflected in the Summary Compensation Table, but were not used in calculating the incentive share awards described below. Performance Based Incentive Compensation - ---------------------------------------- Performance Based Incentive Compensation (at risk compensation or bonus) is designed to deliver rewards above base salary, if the System and the individual executives perform well. The incentive components of the compensation plans are based on formulae with difficult threshold targets. Under the formulae in the incentive compensation plans, in order for any plan bonuses to be awarded, the System must achieve a return on equity that places the System in the top 50% of the approximately 90 electric utilities listed in the Duff & Phelps Utility Group (the National Grouping) or in the top 50% of the New England/New York regional utilities (the Regional Grouping). The NEES Board of Directors, in response to extraordinary events, may enhance or curtail the actual return on equity used to determine whether the System met the targets. They did not do so for 1994. In February 1995, the Committee voted the bonuses under these plans. For the maximum incentive to be awarded, the System must achieve a return on equity in the top 25% of both the National and Regional Groupings and the System's cost per kilowatthour must be the lowest or next to lowest of a selected New England electric utility group. In 1994, if only one of the return on equity targets had been met, Mr. Rowe would have received a bonus (cash and incentive shares as described below) of 19.2% of base pay. Since the maximum targets were achieved, his formula bonus (cash and shares) was 80% of base pay. No bonus awards are made if minimum return on equity targets are not met or if earnings after bonuses are not sufficient to cover dividends, even if the return on equity targets are met. Mr. Rowe's bonus under the plan is directly related to achievement of the above described corporate targets. The incentive compensation plan bonuses of the other executives are additionally dependent upon the achievement of individual goals. Based upon information available at the time of determining bonus amounts, in 1994 the System placed in the 76th and the 75th percentiles in return on shareholder equity of the National and Regional Groupings, respectively. The System placed next to the lowest in the Regional Grouping with respect to customer cost per kilowatthour in 1994. The cash portions of the incentive compensation formulae are driven by annual measurements of the shareholder return on equity and customer cost of electricity. As mentioned above, the NEES Board has the discretion to base bonuses on an adjusted shareholder return on equity. The NEES Board made no such adjustment for 1994. In order to provide a long-term component which is reflective of the shareholder total return, the participants in the incentive compensation plans are awarded common shares of the System under an incentive share plan, approved by the shareholders in 1990. The shares are restricted against sale for five years, except in the event of death, disability, or hardship. Shares are only awarded against incentive compensation plan cash awards generated by the formulae. No discretion is exercised by the Committee in the awarding of these restricted shares. An individual's award of shares under the incentive share plan is a fixed percentage of her or his cash award for that year from the incentive compensation plan in which she or he participates. For Mr. Rowe, the percentage was 60% for 1994. If no cash award is made, no shares are distributed. Further, total awards of shares in any calendar year cannot exceed one-half of one percent (0.5%) of the number of outstanding shares at the end of the previous calendar year. (The incentive shares awarded for 1994 were 0.08% of the number of outstanding shares.) For 1994 awards, participants were given the option of deferring receipt of the shares, and dividends thereon, for five years, or until the later of five years or termination of employment. The deferred share account will be distributable in either shares or a 50/50 combination of shares and cash. The account may also be made available in the event of death, disability, or hardship. The Committee voted to approve the bonuses upon which the share awards are based on February 27, 1995. Benefits - -------- The executive benefits are designed both to provide a competitive package and to retain System flexibility in staffing management to meet changing conditions. See Plan Summaries and Retirement Plans, above. New England Electric System Compensation Committee John M. Kucharski George M. Sage Felix A. Mirando, Jr. James R. Winoker NEES Board Structure and Compensation - ------------------------------------- NEES has an Executive Committee, an Audit Committee, a Compensation Committee, and a Corporate Responsibility Committee. The Executive Committee acts as a nominating committee. The committee memberships listed below are as of January 1, 1995. The members of the Executive Committee are Mrs. Bok, Mr. Ladd, Mr. Rowe, Mr. Sage, and Ms. Wexler. Mrs. Bok serves as the Chairman of this Committee. During the intervals between meetings of the Board of Directors, the Executive Committee has all the powers of the Board that may be delegated. This Committee also considers written recommendations from shareholders for nominees to the Board. The members of the Audit Committee are Messrs. Joskow, McLane, Soule, and Winoker. Mr. Joskow serves as the Chairman of this Committee. The Audit Committee reviews with the independent public accountants the scope of their audit and management's financial stewardship for the current and prior years. This Committee also selects and recommends, subject to the Board of Directors' approval, the independent public accountants to be engaged for the coming year. The members of the Compensation Committee are Messrs. Kucharski, Mirando, Sage, and Winoker. Mr. Sage serves as the Chairman of this Committee. The Compensation Committee is responsible for executive compensation, including the administration of certain of NEES' incentive compensation plans. The members of the Corporate Responsibility Committee are Mrs. Bok, Mr. McClure, Mr. Rowe, Ms. Wexler, and Mr. Wilson. Mr. Wilson serves as the Chairman of this Committee. The Corporate Responsibility Committee is responsible for reviewing compliance with laws and regulations, offering guidance in considering public policy issues, and helping to assure ethical conduct. The Chairman of the Executive Committee receives an annual retainer of $7,000. Other members of the Executive Committee, except Mr. Rowe, receive an annual retainer of $5,000. The Chairmen of the Audit, Compensation, and Corporate Responsibility Committees each receive an annual retainer of $6,000. Other members of these Committees, except Mr. Rowe, receive annual retainers of $4,000. All directors participating in a Committee meeting, except Mr. Rowe, receive a meeting fee of $850 plus expenses. Members of the Board of Directors, except Mr. Rowe, receive annually a retainer of $14,000 and 200 common shares of NEES, and a meeting fee of $850 plus expenses. NEES permits directors to defer all or a portion of any retainers and meeting fees under a deferred compensation plan. Under the plan, at retirement directors may elect to receive lump sum payments of all amounts deferred with interest, or either lifetime annuities or ten year annuities, depending upon the specific deferral arrangement. A special account is maintained on NEES' books showing the amounts deferred and the interest accrued thereon. This plan also provides certain death and disability benefits. Group life insurance of $72,000 is provided to each member of the Board of Directors. Director contributions to qualified charities are matched by NEES under a matching gift program. Pursuant to a director retirement plan, non-employee directors who have served on the Board of NEES for 5 years or more will receive a retirement benefit upon the later of the director's retirement from the Board or age 60. The benefit level is 100% of the annual retainer for directors who served on the Board for 10 or more years and 75% of the annual retainer for directors who served between 5 and 10 years. There are no death benefits under the plan. The Board of Directors held 8 meetings in 1994. The Executive, Audit, Compensation, and Corporate Responsibility Committees held 1, 3, 5, and 2 meeting(s), respectively, in 1994. With the exception of Messrs. Kucharski, McLane, and Soule, all directors attended at least 75% of the aggregate number of meetings of the Board of Directors and the committees of which they were members. Mass. Electric, Narragansett, and NEP Directors' Compensation - ------------------------------------------------------------- Members of the Mass. Electric and Narragansett Boards of Directors, except Dickson, McCabe, Rowe, and Sergel receive a quarterly retainer of $1,250, a meeting fee of $600 plus expenses, and 50 NEES common shares each year. Since all members of the NEP Board are employees of NEES System companies, no fees are paid for service on the Board except as noted on page 22 for Mrs. Bok. Mass. Electric and Narragansett permit directors to defer all or a portion of their retainers and meeting fees. Special accounts are maintained on Mass. Electric's and Narragansett's books showing the amounts deferred and the interest accrued thereon. Item 7. CONTRIBUTIONS AND PUBLIC RELATIONS (1) None. Payments are made to certain employees and other persons, who may act in the capacities enumerated in Item 7 for services rendered or materials purchased, but such payments are not contributions. (2) Year Ended December 31, 1994. Accounts Charged, if any, per Books Purpose of Disbursing Name of Recipient or Beneficiary (A) Company Amount - -------------------------------------- ----------------- ------ Name of Company --------------- Mass. Electric -------------- Massachusetts Electric & Gas Association 930.24 &$ 70,087.00 426.40 Nashua River Watershed 930.24 &$ 344.00 426.10 Connecticut River Watershed Council 930.24 $ 200.00 Joyce & Joyce (B) 426.40 $ 6,250.00 Committee Against Graduated Income Tax 426.40 $ 5,000.00 Edison Electric Institute 426.40 $ 4,564.00 Massachusetts Taxpayers Foundation 426.10 $ 8,682.00 The Alliance to Save Energy 426.10 $ 5,500.00 New England Legal Foundation 426.10 $ 5,400.00 National Conference of Christians & Jews 426.10 $ 4,650.00 NAACP Legal Defense Fund 426.10 $ 1,250.00 The Northeast Corridor Initiative Inc. 426.10 $ 1,000.00 NEP --- Gallagher Callahan and Gartrell (B) 426.40 $ 35,158.00 Massachusetts Taxpayers Foundation Inc. 426.40 $ 8,682.00 Committee Against Graduated Income Tax 426.40 $ 5,000.00 Joyce & Joyce (B) 426.40 $ 5,000.00 Edison Electric Institute 426.40 $ 1,992.00 Massachusetts Electric & Gas Association 426.40 $ 48.00 American Enterprise Institute 426.10 $ 54,000.00 Connecticut River Water Program 426.10 $ 20,000.00 Resources for the Future 426.10 $ 10,000.00 The Alliance to Save Energy 426.10 $ 2,500.00 Save the Bay 426.10 $ 2,500.00 New England Legal Foundation 426.10 $ 2,400.00 The Northeast Corridor Initiative Inc. 426.10 $ 2,000.00 NAACP Legal Defense Fund 426.10 $ 750.00 Narragansett ------------ John G. Coffey, Esq. (B) 426.40 $ 40,000.00 Winsor Association Co. (B) 426.40 $ 26,000.00 Edison Electric Institute 426.40 $ 1,578.00 Save the Bay 426.10 $ 27,315.00 R.I. Public Expenditure Council 426.10 $ 11,674.00 National Conference of Christians & Jews 426.10 $ 2,000.00 New England Legal Foundation 426.10 $ 2,000.00 The Northeast Corridor Initiative Inc. 426.10 $ 2,000.00 The Alliance to Save Energy 426.10 $ 1,800.00 NAACP Legal Defense Fund 426.10 $ 500.00 Granite State ------------- Gallagher Callahan and Gartrell (B) 426.40 $ 5,025.00 Edison Electric Institute 426.40 $ 166.00 The Alliance to Save Energy 426.10 $ 200.00 New England Legal Foundation 426.10 $ 200.00 NEES ---- Committee to Defend First Amendment Rights 426.40 $100,000.00 Paul, Hastings, Janofsky & Walker (B) 426.40 $ 48,503.39 Swidler & Berlin (B) 426.40 $ 22,392.68 Committee Against the Graduated Income Tax 426.40 $ 15,000.00 Coalition to Oppose Forced Fees 426.40 $ 5,000.00 - -------------------- (A)All such payments, unless otherwise noted, were subscriptions, dues, and/or contributions. (B)Payments for legislative services. Item 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS Part I. Serving Receiving Compensation Transaction Company Company (1994) - ----------- ------- --------- ------------ Fuel Purchase Contract (1) NEEI NEP $90,411,206 Phase I Terminal Facility Support Agreement (2) NEET NEP $ 2,336,846 Phase II Massachusetts TransmissionNEHTEC NEP $ 8,103,102 Facilities Support Agreement (3) Phase II New Hampshire TransmissionNEHTC NEP $ 6,497,602 Facilities Support Agreement (4) - -------------------- (1) Contract dated 7/26/79 as amended was in effect at 12/31/94. (2) Agreement dated 12/1/81 as amended was in effect at 12/31/94. (3) Agreement dated 6/1/85 as amended was in effect at 12/31/94. (4) Agreement dated 6/1/85 as amended was in effect at 12/31/94. Part II. See Item 6, Part III. Part III. None. Item 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES None. Item 10. FINANCIAL STATEMENTS AND EXHIBITS Financial Statements - -------------------- NEES Consolidating Financial Statements (Supplement A-1) and Financial Statements and Supporting Schedules of NEES and NEES subsidiaries consolidated contained in the NEES 1994 Form 10-K (Supplement A-2). Exhibits - -------- Unless otherwise indicated, the exhibits listed below are incorporated by reference to the appropriate exhibit numbers and the commission file numbers indicated in parenthesis. A. Annual Reports: 1. Connecticut Yankee Atomic Power Company 1994 Annual Report to Shareholders (Exhibit A.2.1. to Northeast Utilities' Form U-5-S, File No. 30-246). 2. Maine Yankee Atomic Power Company 1994 Annual Report (filed herewith). 3. Massachusetts Electric Company, Form 10-K for the year ended December 31, 1994 (File No. 0-5464). 4. The Narragansett Electric Company, Form 10-K for the year ended December 31, 1994 (File No. 0-898). 5. New England Electric System, Form 10-K for the year ended December 31, 1994 (File No. 1-3446). 6. New England Power Company, Form 10-K for the year ended December 31, 1994 (File No. 0-1229). 7. Vermont Yankee Nuclear Power Corporation 1994 Annual Report to Stockholders (filed herewith). 8. Yankee Atomic Electric Company 1994 Annual Report to Stockholders (filed herewith). B. Corporate Documents: 1. Granite State Electric Company: a. Articles of Organization (Exhibit B-1a to NEES 1983 Form U-5-S). b. By-laws (Exhibit B-1b to NEES 1983 Form U-5-S). 2. Massachusetts Electric Company: a. Articles of Organization (Exhibit B-2a to NEES 1983 Form U-5-S); Articles of Amendment dated March 5, 1993, August 11, 1993, September 20, 1993, and November 15, 1993 (Exhibit 3(a) to 1993 Form 10-K, File No. 0-5464). b. By-laws (Exhibit 3(b) to 1993 Form 10-K, File No. 0-5464). 3. The Narragansett Electric Company: a. Charter (Exhibit B-3a to NEES 1983 Form U-5-S); Amendment to Charter dated June 9, 1988 (Exhibit B-3.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit 3 to 1980 Form 10-K, File No. 0-898). c. Stockholders Votes re Preference Provisions as amended dated March 23, 1993 (Exhibit 4(c) to NEES 1993 Form 10-K, File No. 1-3446). 4. Narragansett Energy Resources Company: a. Articles of Incorporation (Exhibit B-4a to NEES 1987 Form U-5-S). b. By-laws (Exhibit B-4b to NEES 1987 Form U-5-S). 5. New England Electric Resources, Inc.: a. Articles of Organization (Exhibit B-5a to NEES 1993 Form U-5-S). b. By-Laws (Exhibit B-5b to NEES 1993 Form U-5-S). 6. New England Electric System: a. Agreement and Declaration of Trust (Exhibit 3 to NEES 1994 Form 10-K, File No. 1-3446). 7. New England Electric Transmission Corporation: a. Restated Articles of Incorporation (Exhibit B-6a to NEES 1983 Form U-5-S). b. By-laws (Exhibit B-6b to NEES 1983 Form U-5-S). 8. New England Energy Incorporated: a. Articles of Organization (Exhibit B-7a to NEES 1983 Form U-5-S); Articles of Amendment dated April 8, 1988 (Exhibit B.8.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit B.8.b. to NEES 1988 Form U-5-S). 9. New England Hydro Finance Company, Inc. a. Articles of Organization (Exhibit B.9.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit B.9.b. to NEES 1988 Form U-5-S). 10. New England Hydro-Transmission Corporation a. Articles of Incorporation (Exhibit B-8a to NEES 1986 Form U-5-S); Articles of Amendment dated January 18, 1989 (Exhibit B.10.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit B.10.b. to NEES 1988 Form U-5-S). 11. New England Hydro-Transmission Electric Company a. Restated Articles of Organization dated January 13, 1989 (Exhibit B.11.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit B.11.b. to NEES 1988 Form U-5-S). 12. New England Power Company: a. Articles of Organization (Exhibit B-8a to NEES 1983 Form U-5-S); Articles of Amendment dated June 25, 1987 (Exhibit B.12.a. to NEES 1988 Form U-5-S). b. By-laws (Exhibit 3 to 1987 Form 10-K, File No. 0-1229). 13. New England Power Service Company: a. Articles of Organization (Exhibit B-9a to NEES 1983 Form U-5-S). b. By-laws (Exhibit B.13.b to NEES 1988 Form 10-K, File No. 0-1229). C. Funded Debt: 1. Granite State Electric Company: Note Agreement with John Hancock dated March 15, 1985 (Exhibit A to Granite Certificate of Notification, File No. 70-6998). Note Agreement with Teachers Insurance dated as of February 1, 1987 (Exhibit A to Granite Certificate of Notification, File No. 70-7288). Note Agreement with Aid Association for Lutherans dated as of October 1, 1991 (Exhibit C-1 to NEES 1991 Form U-5-S). Note Agreement with First Colony Life Insurance Company dated as of November 1, 1993 (Exhibit C-1 to NEES 1993 Form U-5-S). 2. Massachusetts Electric Company: First Mortgage Indenture and Deed of Trust, dated as of July 1, 1949, and twenty supplements thereto (Exhibit 7-A, File No. 1-8019; Exhibit 7-B, File No. 2-8836; Exhibit 4-C, File No. 2-9593; Exhibit 4 to 1980 Form 10-K, File No. 2-8019; Exhibit 4 to 1982 Form 10-K, File No. 0-5464; Exhibit 4 to 1986 Form 10-K, File No. 0-5464; Exhibit 4(a) to 1988 Form 10-K, File No. 1-3446; Exhibit 4(a) to 1989 Form 10-K, File No. 1-3446; Exhibit 4(a) to 1992 Form 10-K, File No. 1-3446; Exhibit 4(a) to 1993 Form 10-K, File No. 1-3446). 3. The Narragansett Electric Company: First Mortgage Indenture and Deed of Trust, dated as of September 1, 1944, and twenty-one supplements thereto (Exhibit 7-1, File No. 2-7042; Exhibit 7-B, File No. 2-7490; Exhibit 4-C, File No. 2-9423; Exhibit 4-D, File No. 2-10056; Exhibit 4 to 1980 Form 10-K, File No. 0-898; Exhibit 4 to 1982 Form 10-K, File No. 0-898; Exhibit 4 to 1983 Form 10-K, File No. 0-898; Exhibit 4 to 1985 Form 10-K, File No. 0-898; Exhibit 4 to 1986 Form 10-K, File No. 0-898; Exhibit 4 to 1987 Form 10-K, File No. 0-898; Exhibit C-3 to NEES 1991 Form U-5-S; Exhibit 4(b) to 1992 Form 10-K, File No. 1-3446; Exhibit 4(b) to 1993 Form 10-K, File No. 1-3446). 4. New England Electric Transmission Corporation: Note Agreement with PruCapital Management, Inc. et al. dated as of September 1, 1986; Mortgage, Deed of Trust and Security Agreement dated as of September 1, 1986 (Exhibit 10(g) to 1986 Form 10-K, File No. 1-3446). 5. New England Energy Incorporated: Credit Agreement dated as of April 28, 1989 (Exhibit 10(e)(v) to NEES 1989 Form 10-K, File No. 1-3446); Amendment dated as of June 1, 1990 (Exhibit 10(e)(v) to NEES 1990 Form 10-K, File No. 1-3446); Amendment dated as of August 1, 1992 (Exhibit 10(e)(v) to NEES 1992 Form 10-K, File No. 1-3446). 6. New England Power Company: a. General and Refunding Mortgage Indenture and Deed of Trust dated as of January 1, 1977 and nineteen supplements thereto (Exhibit 4(b) to 1980 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1982 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1983 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1985 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1986 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1988 Form 10-K, File No. 0-1229; Exhibit 4(c)(ii) to 1989 Form 10-K, File No. 1-3446; Exhibit 4(c)(ii) to 1990 Form 10-K, File No. 1-3446; Exhibit C-6b to NEES 1991 Form U-5-S; Exhibit 4(c)(ii) to NEES 1992 Form 10-K, File No. 1-3446; Exhibit 4(d) to NEES 1993 Form 10-K, File No. 1-3446). b. Loan Agreement with Massachusetts Industrial Finance Agency dated as of March 15, 1980 and two supplements thereto (Exhibit C-8c to NEES 1983 Form U-5-S); Supplements dated as of October 1, 1992 and September 1, 1993 (Exhibit C-6b to NEES 1993 Form U-5-S). c. Loan Agreement with Business Finance Authority of the State of New Hampshire (formerly the Industrial Development Authority of the State of New Hampshire) dated as of November 15, 1983 (Exhibit C-8d to NEES 1983 Form U-5-S); First Supplement dated as of April 1, 1986 (Exhibit C-7d to NEES 1986 Form U-5-S); Second Supplement dated as of August 1, 1988 (Exhibit C.7.d. to NEES 1988 Form U-5-S); Third Supplement dated as of February 1, 1989; Fourth Supplement dated as of November 1, 1990 (Exhibit C-6d to NEES 1990 Form U-5-S); Fifth Supplement dated as of June 15, 1991 (Exhibit C-6d to NEES 1991 Form U-5-S); Sixth Supplement dated as of January 1, 1993 (Exhibit C-6d to NEES 1992 Form U-5-S); Seventh Supplement dated as of October 1, 1993 and Eighth Supplement dated as of December 1, 1993 (Exhibit C-6c to NEES 1993 Form U-5-S). d. Guarantee Agreements with Connecticut Yankee Atomic Power Company, et al., dated as of November 1, 1981, November 13, 1981 (Exhibit C-8f to NEES 1983 Form U-5-S, and August 1, 1985 (Exhibit 10(c) to NEES 1985 Form 10-K, File No. 1-3446). e. Loan Agreement with the Connecticut Development Authority dated as of October 15, 1985 (Exhibit C-8(h) to NEES 1985 Form U-5-S). D. New England Electric System and Subsidiary Companies, Federal and State Income Tax Allocation Agreement (filed herewith). E. 1. New England Electric Transmission Corporation Annual Report (filed herewith). 2. Schedule showing Money Pool investments for 1994 (filed herewith). 3. NEERI annual report on Modified Form U-13-60 (filed herewith). 4. Ocean State Power Financial Statements as of December 31, 1994 (filed herewith). 5. Ocean State Power II Financial Statements as of December 31, 1994 (filed herewith). 6. OSP Finance Company Financial Statements as of December 31, 1994 (filed herewith). 7. Financial Statements of the New England Electric System Companies Incentive Thrift Plan (Thrift Plan) (filed herewith). 8. Financial Statements of the New England Electric System Companies Incentive Thrift Plan II (Thrift Plan II) (filed herewith). 9. Financial Statements of the Yankee Atomic Electric Company Thrift Plan (filed herewith). Note: The New England Electric System Companies Employees' Share Ownership Plan and NEES Goals Program were combined into the Thrift Plan and Thrift Plan II. Accordingly, no financial statements are provided for them. F. Schedules (filed herewith). G. Financial Data Schedules (filed herewith). H. None. I. None. The name "New England Electric System" means the Trustee or Trustees for the time being (as trustee or trustees but not personally) under an Agreement and Declaration of Trust dated January 2, 1926, as amended, which is hereby referred to and a copy of which, as amended, has been filed with the Secretary of The Commonwealth of Massachusetts. Any agreement, obligation or liability made, entered into or incurred by or on behalf of New England Electric System binds only its trust estate, and no shareholder, director, trustee, officer or agent thereof assumes or shall be held to any liability therefor. SIGNATURE New England Electric System, a registered holding company, has duly caused this Annual Report, Form U-5-S, for the year ended December 31, 1994, Commission's File No. 30-33 to be signed on its behalf, by the undersigned thereunto duly authorized, pursuant to the requirements of the Public Utility Holding Company Act of 1935. NEW ENGLAND ELECTRIC SYSTEM s/Michael E. Jesanis By: Michael E. Jesanis, Treasurer Date: May 1, 1995 EX-99 2 EXHIBIT INDEX EXHIBIT INDEX Exhibit No.Description Page - ---------------------- ---- Supplement NEES Consolidating Balance Sheet, ConsolidatingFiled under A-1 Income and Retained Earnings Statements andcover of Consolidating Statement of Changes in Form SE Financial Position for the year ended December 31, 1994 Supplement NEES Form 10-K for the year ended December 31,Filed under A-2 1994 cover of Form SE A.1. Connecticut Yankee Atomic Power Company Incorporated 1994 Annual Report to Shareholders by reference A.2. Maine Yankee Atomic Power Company Filed under 1994 Annual Report cover of Form SE A.3. Massachusetts Electric Company Incorporated Form 10-K for the year ended December 31, 1994by reference A.4. The Narragansett Electric Company Incorporated Form 10-K for the year ended December 31, 1994by reference A.5. New England Electric System Incorporated Form 10-K for the year ended December 31, 1994by reference A.6. New England Power Company Incorporated Form 10-K for the year ended December 31, 1994by reference A.7. Vermont Yankee Nuclear Power Corporation Filed under 1994 Annual Report to Stockholders cover of Form SE A.8. Yankee Atomic Electric Company Filed under 1994 Annual Report to Stockholders cover of Form SE B.1.a. Granite State Electric Company Incorporated Articles of Organization by reference B.1.b. Granite State Electric Company Incorporated By-laws by reference B.2.a. Massachusetts Electric Company Incorporated Amendment to Articles of Organization by reference B.2.b. Massachusetts Electric Company Incorporated By-laws by reference B.3.a. The Narragansett Electric Company Incorporated Amendment to Charter by reference B.3.b. The Narragansett Electric Company Incorporated By-laws by reference B.3.c. The Narragansett Electric Company Incorporated Stockholders Votes re Preference Provisionsby reference B.4.a. Narragansett Energy Resources Company Incorporated Articles of Incorporation by reference EXHIBIT INDEX Exhibit No.Description Page - ---------------------- ---- B.4.b. Narragansett Energy Resources Company Incorporated By-laws by reference B.5.a. New England Electric Resources, Inc. Incorporated Articles of Organization by reference B.5.b. New England Electric Resources, Inc. Incorporated By-laws by reference B.6.a. New England Electric System Incorporated Agreement and Declaration of Trust by reference B.7.a. New England Electric Transmission CorporationIncorporated Restated Articles of Incorporation by reference B.7.b. New England Electric Transmission CorporationIncorporated By-laws by reference B.8.a. New England Energy Incorporated Incorporated Amendment to Articles of Organization by reference B.8.b. New England Energy Incorporated Incorporated By-laws by reference B.9.a. New England Hydro Finance Company, Inc. Incorporated Articles of Organization by reference B.9.b. New England Hydro Finance Company, Inc. Incorporated By-Laws by reference B.10.a. New England Hydro-Transmission CorporationIncorporated Amendment to Articles of Incorporation by reference B.10.b. New England Hydro-Transmission CorporationIncorporated By-laws by reference B.11.a. New England Hydro-Transmission Electric CompanyIncorporated Restated Articles of Organization by reference B.11.b. New England Hydro-Transmission Electric CompanyIncorporated By-laws by reference B.12.a. New England Power Company Incorporated Amendment to Articles of Organization by reference B.12.b. New England Power Company Incorporated By-laws by reference B.13.a. New England Power Service Company Incorporated Articles of Organization by reference B.13.b. New England Power Service Company Incorporated By-laws by reference C.1. Granite State Electric Company Incorporated Note Agreement with John Hancock by reference Granite State Electric Company Incorporated Note Agreement with Teachers Insurance by reference EXHIBIT INDEX Exhibit No.Description Page - ---------------------- ---- Granite State Electric Company Incorporated Note Agreement with Aid Association for by reference Lutherans Granite State Electric Company Incorporated Note Agreement with First Colony Life by reference Insurance Company C.2. Massachusetts Electric Company Incorporated First Mortgage Indenture and Deed of Trustby reference and twenty supplements thereto C.3. The Narragansett Electric Company Incorporated First Mortgage Indenture and Deed of Trustby reference and twenty-one supplements thereto C.4. New England Electric Transmission CorporationIncorporated Note Agreement with PruCapital Management, Inc.by reference et al. C.5. New England Energy Incorporated Incorporated Credit Agreement dated as of April 28, 1989by reference and Amendments thereto C.6.a. New England Power Company General and Incorporated Refunding Mortgage Indenture and Deed of Trustby reference and nineteen supplements thereto C.6.b. New England Power Company Incorporated Loan Agreement with Massachusetts Industrialby reference Finance Agency and four supplements thereto C.6.c. New England Power Company Incorporated Loan Agreement with Business Finance Authorityby reference of the State of New Hampshire (formerly the Industrial Development Authority of the State of New Hampshire) and eight supplements thereto C.6.d. Guarantee Agreements with Connecticut Incorporated Yankee Atomic Power Company, et. al. by reference C.6.e. Loan Agreement with Connecticut DevelopmentIncorporated Authority by reference D. New England Electric System and SubsidiaryFiled under Companies, Federal and State Income Tax cover of Allocation Agreement Form SE E.1. New England Electric Transmission CorporationFiled under Annual Report cover of Form SE E.2. Money Pool investments for 1994 Filed herewith E.3. NEERI annual report on Modified Form U-13-60Filed herewith E.4. Ocean State Power Financial Statements as ofFiled under December 31, 1994 cover of Form SE E.5. Ocean State Power II Financial Statements Filed under as of December 31, 1994 cover of Form SE EXHIBIT INDEX Exhibit No.Description Page - ---------------------- ---- E.6. OSP Finance Company Financial Statements Filed under as of December 31, 1994 cover of Form SE E.7. New England Electric System Companies Filed under Incentive Thrift Plan Financial Statementscover of Form SE E.8. New England Electric System Companies Filed under Incentive Thrift Plan II Financial Statementscover of Form SE E.9. Yankee Atomic Electric Company Filed under Thrift Plan Financial Statements cover of Form SE F Schedules Filed under cover of Form SE G Financial Data Schedules Filed herewith EX-99 3 EXHIBIT E.2. Exhibit E.2. 1994 Report on NEES Money Pool ($000's) Avg. Max. Min. Investment Company Invest. Invest. Invest. at 12/31/94 - ------- ------- ------- ------- ----------- NEES (Trust) $5,328 $24,800 $ 75 $24,800 Massachusetts Electric Co. 11 4,025 -0- -0- New England Power Co. -0- -0- -0- -0- The Narragansett Electric Co. -0- -0- -0- -0- Granite State Electric Co. 826 2,300 -0- -0- New England Power Service Co.10,141 21,023 -0- -0- New England Electric Transmission10 325 -0- 325 Corporation New England Energy Incorporated3,841 13,475 -0- 1,350 New England Hydro-Transmission6,869 15,900 375 3,850 Electric Company (NEHTEC) New England Hydro-Transmission3,783 7,875 -0- 775 Corporation (NEHTC) Narragansett Energy Resources 1,990 5,825 550 1,600 Company (NERC) EX-99 4 EXHIBIT E.3. Exhibit E.3. Modified FORM U-13-60 ANNUAL REPORT For the Period Beginning January 1, 1994 and Ending December 31, 1994 To The U.S. SECURITIES AND EXCHANGE COMMISSION Of New England Electric Resources, Inc. A Subsidiary Service Company Date of Incorporation: January 13, 1992 State or Sovereign Power under which Incorporated or Organized: The Commonwealth of Massachusetts Location of Principal Executive Offices of Reporting Company: 25 Research Drive Westborough, MA 01582 Report filed pursuant to Order dated September 4, 1992 in file number 70-7950 Name, title, and address of officer to whom correspondence concerning this report should be addressed: J.G. Cochrane Treasurer 25 Research Drive Westborough, MA 01582 Name of Principal Holding Company Under Which Reporting Company is Organized: New England Electric System SEC 1926 (6-82) INSTRUCTIONS FOR USE OF MODIFIED FORM U-13-60 1. Time of Filing Annual Report essentially in the form of U-13-60 shall be filed appended to Form U5S, Annual Report of the Parent and Associate Companies Pursuant to the Public Utility Holding company Act of 1935. Form U5S is required to be filed by May 1. 2. Number of Copies Each annual report shall be filed in duplicate. The company should prepare and retain at least one extra copy for itself in case correspondence with reference to the report becomes necessary. 3. Definitions - Definitions contained in Instruction 01-8 to the Uniform System of Accounts for Mutual Service Companies and Subsidiary Service Companies, Public Utility Holding Company Act of 1935, as amended February 2, 1979 shall be applicable to words or terms used specifically within this Form U-13-60. 4. Organization Chart The company shall submit with each annual report a copy of its current organization chart. ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS Schedule or Page Description of Schedules and Accounts Account No. Number COMPARATIVE BALANCE SHEET Schedule I 4-5 Company property Schedule II 6-7 Accumulated provision for depreciation and amortization of company property Schedule III 8 Investments Schedule IV 9 Accounts receivable Schedule V 10 Miscellaneous deferred debits Schedule IX 11 Proprietary capital Schedule XI 12 Long-term debt Schedule XII 13 Current and accrued liabilities Schedule XIII 14 Notes to financial statements Schedule XIV 15 COMPARATIVE INCOME STATEMENT Schedule XV 16 Analysis of billing - nonassociate companiesAccount 45817-18 Departmental analysis of salaries Account 920 19 Outside services employed Account 923 20 Miscellaneous general expenses Account 930.2 21 Taxes other than income taxes Account 408 22 Donations Account 426.1 23 Other deductions Account 426.5 24 Notes to statement of income Schedule XVIII 25 ORGANIZATION CHART 26 ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE I COMPARATIVE BALANCE SHEET Give balance sheet of Company as of December 31 of the current and prior year Account Assets and Other Debits As of December 31 Current Prior COMPANY PROPERTY 101 Company property (Schedule II) $ $ 107 Construction work in progress (Schedule II) ------- ------- Total Property ------- ------- 108 Less accumulated provision for depreciation and amortization of company property (Schedule III) ------- ------- Net Company Property ------- ------- INVESTMENTS 123 Investments in associate companies (Schedule IV) 124 Other Investments (Schedule IV) ------- ------- Total Investments ------- ------- CURRENT AND ACCRUED ASSETS 131 Cash 48,647 65,034 134 Special deposits 135 Working funds 136 Temporary cash investments (Schedule IV) 141 Notes receivable 143 Accounts receivable (Schedule V) 566,085 90,340 144 Accumulated provision of uncollectible accounts 146 Accounts receivable from associate companies37,24520,186 152 Fuel stock expenses undistributed 154 Materials and supplies 163 Stores expense undistributed 165 Prepayments 174 Miscellaneous current and accrued assets ------- ------- Total Current and Accrued Assets 651,977 175,560 ------- ------- DEFERRED DEBITS 181 Unamortized debt expense 184 Clearing accounts 186 Miscellaneous deferred debits (Schedule IX)451,260 188 Research, development, or demonstration expenditures 190 Accumulated deferred income taxes --------- ------- Total Deferred Debits --------- ------- TOTAL ASSETS AND OTHER DEBITS $1,103,237 $175,560 ========= ======= ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE I COMPARATIVE BALANCE SHEET AccountLiabilities and Proprietary Capital As of December 31 Current Prior PROPRIETARY CAPITAL 201 Common stock issued (Schedule XI) $ 1,000 $ 1,000 211 Miscellaneous paid-in-capital (Schedule XI)1,474,000265,000 215 Appropriated retained earnings (Schedule XI) 216 Unappropriated retained earnings (Schedule XI)(641,351)(199,877) -------- ------- Total Proprietary Capital 833,649 66,123 -------- ------- LONG-TERM DEBT 223 Advances from associate companies (Schedule XII) 224 Other long-term debt (Schedule XII) 225 Unamortized premium on long-term debt 226 Unamortized discount on long-term debt - debit --------- ------- Total Long-Term Debt --------- ------- CURRENT AND ACCRUED LIABILITIES 231 Notes payable 232 Accounts payable 15,597 6,067 233 Notes payable to associate companies (Schedule XIII) 234 Accounts payable to associate companies (Schedule XIII) 236,096 102,914 236 Taxes accrued 17,895 456 237 Interest accrued 238 Dividends declared 241 Tax collections payable 242 Miscellaneous current and accrued liabilities (Schedule XIII) --------- ------- Total Current and Accrued Liabilities 269,588 109,437 --------- ------- DEFERRED CREDITS 253 Other deferred credits 255 Accumulated deferred investment tax credits --------- ------- Total Deferred Credits --------- ------- 282 ACCUMULATED DEFERRED INCOME TAXES --------- -------- TOTAL LIABILITIES AND PROPRIETARY CAPITAL$1,103,237$175,560 ========= ======= ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE II COMPANY PROPERTY (Not Applicable) BALANCE AT RETIREMENTS BALANCE BEGINNING OR OTHER (1) AT CLOSE DESCRIPTION OF YEAR ADDITIONS SALES CHANGES OF YEAR Account 301 Organization 303 Miscellaneous Intangible Plant 304 Land and Land Rights 305 Structures and Improvements 306 Leasehold Improvements 307 Equipment (2) 308 Office Furniture and Equipment 309 Automobiles, Other Vehicles and Related Garage Equipment 310 Aircraft and Airport Equipment 311 Other Company Property (3) ---- ------- --- ---- ---- SUB-TOTAL None None ---- ------- --- ---- ---- 107 Construction Work in Progress (4) ---- ------- --- ---- ---- TOTAL None None ==== ======= === ==== ==== (1) PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL: ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE II - CONTINUED (Not Applicable) (2) Subaccounts are required for each class of equipment owned. The company shall provide a listing by subaccount of equipment additions during the year and the balance at the close of the year: BALANCE AT CLOSE SUBACCOUNT DESCRIPTION ADDITIONS OF YEAR ---- ---- TOTAL None None ==== ==== (3) DESCRIBE OTHER COMPANY PROPERTY: None (4) DESCRIBE CONSTRUCTION WORK IN PROGRESS: None ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE III ACCUMULATED PROVISION FOR DEPRECIATION AND AMORTIZATION OF COMPANY PROPERTY (Not Applicable) ADDITIONS OTHER BALANCE AT CHARGED CHANGES BALANCE BEGINNING TO RETIRE- ADD AT CLOSE DESCRIPTION OF YEAR ACCT 403 MENTS (DEDUCT)(1) OF YEAR Account 301 Organization 303 Miscellaneous Intangible Plant 304 Land and Land Rights 305 Structures and Improvements 306 Leasehold Improvements 307 Equipment 308 Office Furniture and Equipment 309 Automobiles, Other Vehicles and Related Garage Equipment 310 Aircraft and Airport Equipment 311 Other Company Property ---- --- --- --- ---- TOTAL None None ==== === === === ==== 22) PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL: None ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE IV INVESTMENTS INSTRUCTIONS:Complete the following schedule concerning investments. Under Account 124 "Other Investments," state each investment separately, with description, including, the name of issuing company, number of shares or principal amount, etc. BALANCE AT BALANCE AT BEGINNING CLOSE DESCRIPTION OF YEAR OF YEAR ACCOUNT 123 - INVESTMENT IN ASSOCIATE COMPANIES ---- ---- TOTAL None None ==== ==== ACCOUNT 124 - OTHER INVESTMENTS ---- ---- TOTAL (1) None None ==== ==== ACCOUNT 136 - TEMPORARY CASH INVESTMENTS ---- ---- TOTAL None None ==== ==== (1) See page 15 "Notes to Financial Statements" footnote (1) ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE V ACCOUNTS RECEIVABLE INSTRUCTIONS:Complete the following schedule listing accounts receivable. BALANCE AT BALANCE AT BEGINNING CLOSE OF YEAR OF YEAR DESCRIPTION ACCOUNT 143 -FEDERAL INCOME TAX BENEFIT RECEIVABLE $61,600 $237,400 Nantucket Electric Company 300,840 Other 28,740 27,845 ------ ------- TOTAL $90,340 $566,085 ====== ======= ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE IX MISCELLANEOUS DEFERRED DEBITS INSTRUCTIONS:Provide detail of items in this account. Items less than $10,000 may be grouped by class, showing the number of items in each class. BALANCE AT BALANCE AT BEGINNING CLOSE DESCRIPTION OF YEAR OF YEAR ACCOUNT 186 - DEFERRED DEBITS NANTUCKET ELECTRIC - LONG TERM RECEIVABLE 451,260 ---- ------- TOTAL None 451,260 ==== ======= ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XI PROPRIETARY CAPITAL OUTSTANDING NUMBER OF PAR OR STATED CLOSE OF PERIOD ACCOUNT SHARES VALUE NO. OF TOTAL NUMBER CLASS OF STOCK AUTHORIZED PER SHARE SHARES AMOUNT 201 COMMON STOCK ISSUED10,000 $1 1,000 $1,000 INSTRUCTIONS:Classify amounts in each account with a brief explanation, disclosing the general nature of transactions which give rise to the reported amounts. DESCRIPTION AMOUNT ACCOUNT 223 - MISCELLANEOUS PAID-IN CAPITAL (1) 1,474,000 ACCOUNT 215 - APPROPRIATED RETAINED EARNINGS --------- TOTAL 1,474,000 ========= INSTRUCTIONS:Give particulars concerning net income or (loss) during the year, distinguishing between compensation for the use of capital owed or net loss remaining from servicing non-associates per the General Instructions of the Uniform Systems of Accounts. For dividends paid during the year in cash or otherwise, provide rate percentage, amount of dividend, date declared and date paid. BALANCE AT NET INCOME BALANCE AT BEGINNING OR DIVIDENDS CLOSE DESCRIPTION OF YEAR (LOSS) PAID OF YEAR ACCOUNT 216 - UNAPPROPRIATED RETAINED EARNINGS$(199,878)$(441,473) None $(641,351) ------- -------- ---- -------- TOTAL$(199,878)$(441,473) None $(641,351) ======= ======== ==== ======== (1) Amount represents contributions in the form of non-interest bearing subordinated notes issued to New England Electric System (NEES). As of December 31, 1994, NEES was authorized to invest up to $2.25 million dollars in the Company in the form of either subordinated noninterest bearing notes, capital contributions or common stock. ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XII LONG-TERM DEBT (Not Applicable) INSTRUCTIONS:Advances from associate companies should be reported separately for advances on notes, and advances on open account. Names of associate companies from which advances were received shall be shown under the class and series of obligation column. For Account 224 - Other long-term debt provide the name of creditor company or organization, terms of the obligation, date of maturity, interest rate, and the amount authorized and outstanding.
TERMS OF OBLIG DATE BALANCE AT BALANCE AT CLASS & SERIES OF INTEREST AMOUNT BEGINNING DEDUCTIONS CLOSE NAME OF CREDITOROF OBLIGATIONMATURITYRATE AUTHORIZEDOF YEAR ADDITIONS (1) OF YEAR ACCOUNT 223 - ADVANCES FROM ASSOCIATE COMPANIES: None ACCOUNT 224 - OTHER LONG-TERM DEBT: None ---- ---- ---- ---- ---- TOTAL None ==== ==== ==== ==== ==== (1) Give an explanation of deductions: None
ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XIII CURRENT AND ACCRUED LIABILITIES INSTRUCTIONS:Provide balance of notes and accounts payable to each associate company. Give description and amount of miscellaneous current and accrued liabilities. Items less than $10,000 may be grouped, showing the number of items in each group. BALANCE AT BALANCE AT BEGINNING CLOSE DESCRIPTION OF YEAR OF YEAR ACCOUNT 233 -NOTES PAYABLE TO ASSOCIATE COMPANIES ---- ---- TOTAL None None ==== ==== ACCOUNT 234 -ACCOUNTS PAYABLE TO ASSOCIATE COMPANIES The Narragansett Electric Company $ 1,023 New England Electric System $ 84,925 New England Hydro Transmission Electric Co. 2,770 New England Power Company 3,949 30,844 New England Power Service Company 14,040 201,459 ------- ------- TOTAL $102,914 $236,096 ======= ======= ACCOUNT 242 -MISCELLANEOUS CURRENT AND ACCRUED LIABILITIES ---- ---- TOTAL None None ==== ==== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XIV NOTES TO FINANCIAL STATEMENTS INSTRUCTIONS:The space below is provided for important notes regarding the financial statements or any account thereof. Furnish particulars as to any significant contingent assets or liabilities existing at the end of the year. Notes relating to financial statements shown elsewhere in this report may be indicated here by reference. (1) In 1994, NEERI invested $250,000 in Quality Power Systems, Inc. (QPS). The investment, authorized by Order of the Commission Release Number 35-26057, is in the form of a debenture due June 1, 2004, which may, at NEERI's option, be converted into common stock of QPS. The debenture provides for quarterly interest payments after June 1, 1994, with the first payment due September 1, 1994. At the time of this filing the payment had not been received. Due to the uncertainty involved in the payment of interest and repayment of principal, NEERI has written off the investment in the fourth quarter of 1994. QPS is seeking additional financing to bring its product to market. Although NEERI has authority to invest up to an additional $100,000 in QPS, NEERI has decided not to make an additional investment at this time. (2) To assist Nantucket Electric Company (NEC) in meeting its short-term needs for reliable energy, NEERI provided materials, delivery, installation, interconnection and start-up testing services for a fully automated two unit diesel driven electric generating plant at the existing NEC Airport Generating Station. The work took place at NEC and New England Electric facilities pursuant to a letter agreement and was completed as of September 30, 1994. The total compensation under the agreement was recognized during the third quarter of 1994. The agreement provides for billing over a three year period at $25,070 per month effective the month immediately following the notice to proceed by NEC. As of December 31, 1994, $727,030 had not yet been billed in accordance with the agreement ($275,770 included in Accounts Receivable and $451,260 included in Miscellaneous Deferred Debits). ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XV STATEMENT OF INCOME ACCOUNT DESCRIPTION CURRENT PRIOR YEAR YEAR INCOME 458 Services rendered to nonassociate companies $1,113,351$ 58,609 421 Miscellaneous income or loss (250,000) -------- -------- TOTAL INCOME 863,351 58,609 -------- -------- EXPENSE 920 Salaries and wages 921 Office supplies and expenses 922 Administrative expense transferred - credit 923 Outside services employed 1,543,724 247,595 924 Property insurance 925 Injuries and damages 926 Employee pensions and benefits 930.1General advertising expenses 930.2Miscellaneous general expenses 931 Rents 932 Maintenance of structures and equipment 403 Depreciation and amortization expense 408 Taxes other than income taxes 409 Income taxes (238,900) (70,915) 410 Provision for deferred income taxes 411 Provision for deferred income taxes - credit 411.5Investment tax credit 426.1Donations 426.5Other deductions 427 Interest on long-term debt 430 Interest on debt to associate companies 431 Other interest expense --------- -------- TOTAL EXPENSE 1,304,824 176,680 --------- -------- NET INCOME OR (LOSS) $(441,473) $(118,071) ======== ======== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 ANALYSIS OF BILLING NONASSOCIATE COMPANIES ACCOUNT 458
DIRECT INDIRECT COMPENSATION EXCESS TOTAL COST COST FOR USE TOTAL OR AMOUNT NAME OF NONASSOCIATE COMPANY CHARGED CHARGED OF CAPITAL COST DEFICIENCY BILLED 458-1 458-2 458-3 458-4 United States Energy 7,833 Association (1) Central Vermont Public Service Corporation (2) 24,567 Kemper Management Service (3) 9,820 Trans Power New Zealand,LTD (4) 4,220 Asian Development Bank (5) 11,725 Price Waterhouse (6) 61,904 RCG/Hagler Bailly, Inc. (7) 43,000 Nantucket Electric Company (8) 918,177 Northrop, Devine & Turbell (9) 1,825 Indeck Energy Services (10) 1,080 The World Bank (11) 24,200 Tokyo Electric Power (12) 5,000 ------- ---- -- ------- ------ --------- TOTAL 1,113,351 ======= ==== == ======= ====== =========
INSTRUCTION: Provide a brief description of the services rendered to each nonassociated company: (1)Consulting activities for the Hungarian Electric Companies. (2) Impact evaluation of CVPS's residential new construction program. (3)Consulting demand side management programs. (4)Consulting services for Static VAr Compensation. (5)Seminar on demand side management and integrated resource planning. (6)Consulting services on independent power to National Energy Policy Office of the government of Thailand. (7)Consulting services for integrated resource planning. (8)$902,520 for generating plant installation and $15,657 for demand side management Consulting. (9)Consulting Services for transmission line engineering. (10)Transmission line inspection. (11)Consulting services for India. (12)Seminar covering IPP solicitation and contracting processes. ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 DEPARTMENTAL ANALYSIS OF SALARIES ACCOUNT 920 NAME OF DEPARTMENT NUMBER PERSONNEL Indicate each dept. or SALARY END OF service function EXPENSE YEAR None None ---- ---- TOTAL None None ==== ==== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 OUTSIDE SERVICES EMPLOYED ACCOUNT 923 INSTRUCTIONS:Provide a breakdown by subaccount of outside services employed. If the aggregate amounts paid to any one payee and included within one subaccount is less than $25,000, only the aggregate number and amount of all such payments included within the subaccount need be shown. Provide a subtotal for each type of service. RELATIONSHIP "A"- ASSOCIATE FROM WHOM PURCHASED ADDRESS "NA"- NON ASSOCIATEAMOUNT ADMINISTRATIVE SERVICES New England Power 25 Research Drive A $1,104,153 Service Company Westborough, MA 01582 New England Power 25 Research Drive A 88,813 Company Westborough, MA 01582 Sherif Fam 36 Concord Ave. NA 49,966 Cambridge, MA 02138 PLM Electric Power 35 Main Street NA 47,037 Hopkinton, MA 01748 Interstate TransformersPost Office Box 11339 NA 56,400 Lexington, Kentucky 40575 Pacific Fabricators PO Box 1719 37,100 4455 Manor SE Albany, OR 97321 49 Vendors* NA 160,255 (each under $25,000) -------- TOTAL ADMINISTRATIVE SERVICES$1,543,724 ========= *Includes 9,197 from Massachusetts Electric Company and 2,599 from The Narragansett Electric Company, which are associated companies. ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 MISCELLANEOUS GENERAL EXPENSES ACCOUNT 930.2 INSTRUCTIONS:Provide a listing of the amount included in Account 930.2, "Miscellaneous General Expenses", classifying such expenses according to their nature. Payments and expenses permitted by Sections 321(b)(2) of the Federal Election Campaign Act, as amended by Public Law 94-283 in 1976 (2 U.S.C. Section 441(b)(2)) shall be separately classified. DESCRIPTION AMOUNT None ---- TOTAL None ==== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 TAXES OTHER THAN INCOME TAXES ACCOUNT 408 INSTRUCTIONS:Provide an analysis of Account 408, "Taxes Other Than Income Taxes". Separate the analysis into two groups: (1) other than U.S. Government taxes, and (2) U.S. Government taxes. Specify each of the various kinds of taxes and show the amounts thereof. Provide a subtotal for each class of tax. KIND OF TAX AMOUNT 1) OTHER THAN U.S. GOVERNMENT TAXES Massachusetts State Tax None ----- SUBTOTAL None ----- 2) U.S. GOVERNMENT TAXES None ----- SUBTOTAL None ----- TOTAL None ===== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 DONATIONS ACCOUNT 426.1 INSTRUCTIONS:Provide a listing of the amount included in Account 426.1, "Donations", classifying such expenses by its purpose. The aggregate number and amount of all items of less than $3,000 may be shown in lieu of details. NAME OF RECIPIENT PURPOSE OF DONATION NONE ---- TOTAL None ==== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 OTHER DEDUCTIONS ACCOUNT 426.5 INSTRUCTIONS:Provide a listing of the amount included in Account 426.5, "Other Deductions", classifying such expenses according to their nature. DESCRIPTION NAME OF PAYEE NONE ---- TOTAL None ==== ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SCHEDULE XVIII NOTES TO STATEMENT OF INCOME INSTRUCTIONS:The space below is provided for important notes regarding the statement of income or any account thereof. Furnish particulars as to any significant increase in services rendered or expenses incurred during the year. Notes relating to financial statements shown elsewhere in this report may be indicated here by reference. See Page 15 ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. ORGANIZATION CHART For the Year Ended December 31, 1994 Board of Directors ! ! ! President ! ! ! ------------------------------ ! ! ! ! ! ! Treasurer Clerk ANNUAL REPORT OF NEW ENGLAND ELECTRIC RESOURCES, INC. For the Year Ended December 31, 1994 SIGNATURE CLAUSE Pursuant to the requirements of the Public Utility Holding Company Act of 1935 and the rules and regulations of the Securities and Exchange Commission issued thereunder, the undersigned company has duly caused this report to be signed on its behalf by the undersigned officer thereunto duly authorized. New England Electric Resources, Inc. --------------------------------- (Name of Reporting Company) By: s/John G. Cochrane ------------------------------- (Signature of Signing Officer) J.G. Cochrane Treasurer ------------------------------------------- (Printed Name and Title of Signing Officer) Date: April 28, 1995 --------------- EX-27 5 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED BALANCE SHEET AND RELATED CONSOLIDATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND ELECTRIC SYSTEM, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 3,716,721 423,713 525,723 418,684 0 5,084,841 64,970 736,823 779,045 1,580,838 0 147,016 1,520,488 233,970 0 0 65,920 0 0 0 1,536,609 5,084,841 2,243,029 128,257 1,818,276 1,946,533 296,496 16,071 312,567 97,005 199,426 8,697 199,426 148,456 93,500 417,966 $3.07 $3.07 Total deferred charges includes other assets and accrued Yankee Atomic costs. Preferred stock reflects preferred stock of subsidiaries. Preferred stock dividends reflect preferred stock dividends of subsidiaries. Short-term notes includes commercial paper obligations. EX-27 6 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF MASSACHUSETTS ELECTRIC COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6 Massachusetts Electric Company 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 995,995 0 240,191 59,536 0 1,295,722 59,953 187,172 136,911 384,036 0 50,000 265,631 81,820 0 0 35,000 0 0 0 479,235 1,295,722 1,482,070 22,265 1,397,137 1,419,402 62,668 (995) 61,673 26,947 34,726 3,114 31,612 29,977 20,967 44,252 0 0 Total deferred charges includes other assets. Short-term notes includes commercial paper obligations and short-term debt to affiliates. EX-27 7 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF THE NARRAGANSETT ELECTRIC COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 7 The Narragansett Electric Company 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 491,915 0 97,735 57,727 0 647,377 56,624 60,170 91,556 208,350 0 36,500 188,862 29,800 0 0 0 0 0 0 183,865 647,377 481,669 4,883 446,672 451,555 30,114 172 30,286 15,697 14,589 2,143 12,446 2,549 14,334 40,188 0 0 Total deferred charges includes other assets. Short-term notes includes commercial paper borrowings. Short-term notes at December 31, 1993 also includes short-term debt to affiliates. EX-27 8 EXHIBIT G FINANCIAL DATA SCHEDULE WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND POWER COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3 New England Power Company 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 1,876,211 69,329 374,654 292,644 0 2,612,838 128,998 374,829 372,763 876,590 0 60,516 695,466 145,575 0 0 0 0 0 LEASES-CURRENT> 0 834,691 2,612,838 1,540,757 96,596 1,273,640 1,370,236 170,521 13,665 184,186 34,813 149,373 3,440 145,933 119,323 38,711 246,572 0 0 Total deferred charges includes other assets and accrued Yankee Atomic costs. Short-term notes includes commercial paper obligations and short-term debt to affiliates. EX-27 9 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF GRANITE STATE ELECTRIC COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 5 Granite State Electric Company 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 45,507 0 6,574 2,247 0 54,328 6,040 4,000 7,949 17,989 0 0 11,000 2,525 0 0 3,400 0 0 0 19,414 54,328 63,564 606 60,108 60,714 2,850 (132) 2,718 1,661 1,057 0 1,057 362 1,402 3,932 0 0 Total deferred charges includes other assets. EX-27 10 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC., AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 11 New England Hydro-Transmission Electric Company, Inc. 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 186,819 5 8,046 9,215 0 204,085 40,000 16,384 10,976 67,360 0 0 98,490 0 0 0 6,960 0 0 0 31,275 204,085 43,728 5,991 18,666 24,657 19,071 157 19,228 10,161 9,067 0 9,067 12,000 9,964 20,978 0 0 EX-27 11 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND HYDRO-TRANSMISSION CORPORATION, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 2 New England Hydro-Transmission Corporation 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 154,346 5 1,432 7,762 0 163,545 23,000 18,949 1,785 43,734 0 0 61,040 2,000 0 0 4,560 0 0 0 52,211 163,545 35,061 3,839 19,168 23,007 12,054 109 12,163 6,224 5,939 0 5,939 4,600 6,203 13,954 0 0 EX-27 12 EXHIBIT G FINANCIAL DATA SCHEDULE
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1 New England Electric Transmission Corporation 1,000 DEC-31-1994 DEC-31-1994 12-MOS PER-BOOK 53,136 0 515 464 0 54,115 165 3,960 196 4,321 0 0 30,112 0 0 0 4,624 0 0 0 15,058 54,115 13,058 223 8,408 8,631 4,427 (2) 4,425 3,331 1,094 0 1,094 1,080 3,301 6,899 0 0 Total deferred charges includes other assets. -----END PRIVACY-ENHANCED MESSAGE-----