-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NtT82sr1EqpEYaupnC1xDYj4mJs4Olw52xjnNWzU21lfn2wj6/BDOj3DmeEessPI rOMJ+2jCnw+q5aRG+P7Maw== 0000108837-99-000003.txt : 19991020 0000108837-99-000003.hdr.sgml : 19991020 ACCESSION NUMBER: 0000108837-99-000003 CONFORMED SUBMISSION TYPE: U-1 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19991019 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: U-1 SEC ACT: SEC FILE NUMBER: 070-09561 FILM NUMBER: 99730420 BUSINESS ADDRESS: STREET 1: 25 RESEARCH DR CITY: WESTBOROUGH STATE: MA ZIP: 01582 BUSINESS PHONE: 5083892000 MAIL ADDRESS: STREET 1: 25 RESEARCH DR CITY: WESTBOROUGH STATE: MA ZIP: 01582 U-1 1 File No. 70- SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM U-1 APPLICATION/DECLARATION UNDER THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 YANKEE ATOMIC ELECTRIC COMPANY 19 Midstate Drive, Suite 200 Auburn, Massachusetts 01501 (Name and principal executive office of company filing this statement) NEW ENGLAND ELECTRIC SYSTEM NORTHEAST UTILITIES (Name of top registered holding companies) Thomas W. Bennet, Jr. Kirk L. Ramsauer Treasurer General Counsel and Clerk 19 Midstate Drive, Suite 200 25 Research Drive Auburn, Massachusetts 01501 Westborough, Massachusetts 01582 (Names and addresses of agents for service) The Commission if requested to send copies of all notices, orders and Communications in connection with this declaration to: John A. Ritsher, Esq. Ropes & Gray One International Place Boston, MA 02110 Item 1. Description of Proposed Transactions - -------------------------------------------- A. Summary of Proposed Transactions Yankee Atomic Electric Company ("Yankee Atomic" or the "Company") proposes to repurchase pro rata from its stockholders (all of which are affiliates of Yankee Atomic) 95% of its presently outstanding Common Stock at a purchase price of $100 per share, an amount equal to the book value per share on June 30, 1999, on the condition that all its Stockholders tender their allotment of shares. The Company intends to accomplish this repurchase in one or more steps over the next one to two years. Thereafter, the Company will maintain minimal equity until it ultimately prepares to liquidate and wrap up its affairs. B. Description of Yankee Atomic Electric Company - ------------------------------------------------ Yankee Atomic, an electric utility company, was incorporated as a Massachusetts electric utility in 1954. The organization of Yankee Atomic was sponsored by a group of New England utilities for the purpose of constructing and operating New England's first atomic powered electric generating plant, located in Rowe, Massachusetts (the Rowe plant). The Rowe plant was licensed to operate by the U.S. Nuclear Regulatory Commission (NRC). The Rowe plant operated commercially from 1961 until February, 1992, when it was permanently removed from service. The Rowe plant is currently being dismantled and decommissioned. The NRC regulates the ongoing decommissioning and spent fuel storage activities at the Rowe plant. The ten sponsoring utilities own the entire common capital stock of Yankee Atomic in the percentages shown in the table below. The sponsoring utilities have each entered into power contracts with Yankee Atomic (the Power Contracts, see Exhibit B hereto) that entitle them to and obligate them to purchase the output of the Rowe plant in the same percentages.
Sponsoring Company Holding Company Percentage of Stock & Power - --------------- ------------ ---------------------- New England Power Co. New England Electric 30.0% The Conn. Lt. & Pwr Co. Northeast Utilities 24.5% Public Service Co. of NH Northeast Utilities 7.0% Western Mass. Elec. Co. Northeast Utilities 7.0% Boston Edison Co. BECo - NSTAR 9.5% Central Maine Power Co. CMP Group 9.5% Montaup Electric Co. Eastern Utilities 4.5% Commonwealth Elec. Co. Commonwealth Energy System 2.5% Cambridge Elect. Lt. Co. Commonwealth Energy System 2.0% Central Vt. Public Service Corp. Not Applicable 3.5% ---- 100%
B. Description of Yankee Atomic Electric Company (continued) ------------------------------------------------------------ In addition to owning and operating the Rowe plant, Yankee Atomic in 1968 was authorized to operate its Nuclear Services Division as a service company to provide engineering services at cost to the Rowe plant and other nuclear plants owned by the Company's affiliates. The Nuclear Services Division was sold on December 1, 1997. C. Background -------------- Yankee Atomic's current capital consists of $15,340,000 of equity evidenced by 153,400 shares of Common Stock, $100 par value per share, which are held by the ten sponsoring companies in the proportions indicated above. (See Exhibit I-1). As essentially a single purpose utility corporation, Yankee Atomic's economic life was primarily keyed to the operating life of its plant. When the plant ceased operation, the Company no longer had any electric revenue producing business and its primary activity since 1992 has been overseeing the decommissioning of the Rowe plant and the management of the Nuclear Services Division. As noted above, the Nuclear Services Division was sold in December, 1997. As a single purpose utility corporation there have been many corporate end of life issues. These issues required advanced financial planning to ensure that all costs associated to the Company's activities are paid for by the Sponsoring utilities of the Company for the electrical energy output produced over its life and that all assets are properly accounted for and depreciated. Such proper financial planning will allow an orderly winding-up of the Company's business to be accomplished concurrently with the decommissioning of the plant. The major future cash requirements which are not yet fully funded are the decommissioning of the plant, including interim storage of spent fuel. Decommissioning is being funded under the Power Contracts over the period ending June 30, 2000 approved by FERC in docket ER95-835-000 with monthly cash payments paid by the Sponsoring utilities to the decommissioning trust. In the event additional decommissioning funds are needed at any future period, the Power Contracts impose a non-cancelable obligation on the Sponsoring utilities to pay all decommissioning costs. In addition, there are balance sheet adjustments which must be made so that all assets are appropriately reduced to properly reflect their loss of value when the plant ceased to operate. The original plant including major capital additions and all tangible assets of the Company are being amortized as authorized by FERC as operating expenses during the remaining license lifetime of the Plant. The recovery of all investments and assets have been approved by FERC in docket ER-95-835-000 and will be fully recovered in cost of service rates by June 30, 2000. In the event additional cost of service (operating and expense) requirements are needed at any future period, the Power Contracts impose a non-cancelable obligation on the Sponsoring utilities to pay all cost of service expenses. Because no additional capital funds are required to amortize any of these assets or to fund any of those remaining end of life obligations, Yankee Atomic believes that appropriate steps should be taken to significantly reduce the Company's outstanding equity contemporaneously with its write-down of its assets. C. Background (continued) -------------------------------- Discussion: The Company's capital structure as of June 30, 1999 was as follows:
Component ($000) % of Total - --------- ------ ---------- Bank Debt $0 0% Common Equity $15,340,000 100% Total $15,340,000 100%
Item 2. Fees, Commissions and Expenses. - ---------------------------------------- Estimated expenses of Yankee Atomic in connection with the repurchase of stock are shown on Exhibit G. Item 3. Applicable Statutory Provisions. ---------------------------------------- Yankee Atomic is an indirect subsidiary of New England Electric System and of Northeast Utilities, each of which is a registered holding company. The acquisition of the Company's common stock from its stockholders is therefore subject to the provisions of Section 12(c) of the Act and of Rules 42 and 46 thereunder. Item 4. Regulatory Approval. ---------------------------- No other state commission or any Federal Commission, other than the Securities and Exchange Commission, has jurisdiction over the proposed transactions. Item 5. Procedure. ------------------- Yankee Atomic does not request a hearing on this Declaration and requests that the Commission issue its order as soon as practicable after the filing hereof. Without prejudice to its right to modify the same if a hearing should be ordered on this Declaration, Yankee Atomic hereby makes the following specifications required by paragraph (B) of Item 5 of Form U-1; 1. There should not be a recommended decision by a hearing officer or any other responsible officer of the Commission. 2. The Division of Corporate Regulation may assist in the preparation of the Commission's decision. 3. There should not be a 30-day waiting period between issuance of the Commission's order and the date on which it is to become effective. Item 6. Exhibits and Financial Statements. - ------------------------------------------ (a) EXHIBITS Filed herewith: A-1 Composite Form of Power Contract, as amended to date B-1 Long-Term Financial Projections through 2000 F-I Opinion of Ropes & Gray as to matters required by Instruction F- I to Exhibits to Form U-1 G-1 Yankee Atomic's Estimated Fees and Expenses H. Proposed Form of Notice (b) FINANCIAL STATEMENTS 1-1 Balance Sheet of Yankee Atomic as of June 30, 1999. 1-2 Statement of Earnings and Retained Earnings of Yankee Atomic for the period ending June 30, 1999. Financial Statements of the top registered holding companies, New England Electric System and Northeast Utilities, have been omitted as not being necessary to a consideration of this application. Item 7. Information as to Environmental Effects. - ------------------------------------------------ The proposed transactions do not involve a major Federal action significantly affecting the quality of the human environment. SIGNATURE Pursuant to the requirements of the Public Utility Holding Company Act of 1935, the undersigned company has duly caused this Declaration to be signed on its behalf by the undersigned thereunto duly authorized. YANKEE ATOMIC ELECTRIC COMPANY s/Thomas W. Bennet By:_________________________________ Thomas W. Bennet, Jr., Vice President, Treasurer, and Chief Financial Officer October 19, 1999 EX-99 2 EXHIBIT INDEX EXHIBIT INDEX Exhibit No. Description Page - ----------- ------------ ------ Financial Statements -------------------- A-1 Composite Form of Power Contract Filed herewith as amended to date B-1 Long-Term Financial Projections Filed herewith through 2000 F-I Opinion of Ropes & Gray as to matters required by Instruction Filed herewith F- I to Exhibits to Form U-1 G-1 Yankee Atomic's Estimated Fees Filed herewith and Expenses H. Proposed Form of Notice Filed herewith Financial Statements - -------------------- 1-1 Balance Sheet of Yankee Atomic Filed herewith as of June 30, 1999 1-2 Statement of Earnings and Filed herewith Retained Earnings of Yankee Atomic for the period ending June 30, 1999 EX-99 3 EXHIBIT A-1 Composite Conformed Copy ------------------------ Yankee Atomic Electric Company POWER CONTRACT [The following is a composite Power Contract as amended through Amendment No. 7 dated as of February 1, 1992. Please note that the "whereas" clauses for each amendment have been omitted, and that conforming signature data for the original counterpart only is included in the Appendix. Also please note that Amendment No. 3 restated the entire power contract. This composite power contract has been prepared as a resource tool and is not the formal contract among the parties.] POWER CONTRACT dated June 30, 1959, as revised April 1, 1975, between YANKEE ATOMIC ELECTRIC COMPANY ("Yankee") and (the names of the Customers appear in the attached Appendix) (the "Customer"). "Yankee is a Massachusetts electric company, organized in 1954, which has constructed and placed in operation a nuclear power plant, the output of which is sold to the New England utilities which are its stockholders. The plant is located at a site owned by Yankee in Rowe, Massachusetts, and consists of a pressurized water reactor and associated steam electric generating, transformation and auxiliary equipment have a net electrical capacity of 176,000 KW (the "plant"). The Atomic Energy Commission has authorized operation of the plant during an initial 40-year term extending to November 4, 1997, pursuant to License No. DPR-3. The percentages of Yankee's outstanding stock held by the Customer and other stockholders of Yankee and the percentages of the capacity and net electrical output of the plant being purchased by them are as follows:
Stock Power Percentage Percentage New England Power Company 30.0% 30.0% The Connecticut Light and Power Company 24.5* 24.5* Boston Edison Company 9.5 9.5 Central Maine Power Company 9.5 ---** Western Massachusetts Electric Company 7.0 7.0 Public Service Company of New Hampshire 7.0 16.5** Montaup Electric Company 4.5 4.5 Commonwealth Electric Company 2.5 2.5 Cambridge Electric Light Company 2.0 2.0 Central Vermont Public Service Corporation 3.5 3.5 100.0% 100.0%
*Represents the consolidation of two prior existing contracts, one with The Connecticut Light and Power Company for 15% and one with The Hartford Electric Light Company for 9.5%, those two companies having merged. **Public Service Company of New Hampshire has agreed to supply power to Central Maine Power Company in amounts equivalent to 9.5% of the net electrical output of the Yankee plant, after appropriate allowance for transmission losses. The parties hereto agree as follows: 1. Scope of Contract ----------------- Yankee will sell and deliver to the Customer and the Customer will take and pay for its power percentage of the net electrical output of the plant during the term of this contract. 2. Term of Contract ---------------- This contract shall continue in full force and effect until the expiration of any license as issued by the Nuclear Regulatory Commission, or any successor agency, with respect to the plant under applicable provisions of the Atomic Energy Act of 1954, as amended from time to time, provided, however, that if the stockholders of Yankee, by vote of not less than 75% in interest of the outstanding stock having general voting rights, shall at any time vote to discontinue the operation of the plant or to liquidate Yankee and wind up its affairs, the obligations of the parties hereunder shall thereupon terminate. Notwithstanding the foregoing, the applicable provisions of this contract shall continue in effect after any termination hereof to the extent necessary (I) to complete the billings and payments required hereunder with respect to the Customer's obligation to pay its power percentage of the full cost of decommissioning the plant in accordance herewith and (ii) to permit final billings and adjustments hereunder with respect to all other obligations of the parties hereunder, including all billings and adjustments with respect to the recovery of Yankee's total cost of service, as provided in Section 6 hereof, until the non-salvageable investment in plant, nuclear fuel and materials and supplies or other assets has been fully amortized in accordance herewith. 3. Operation of the Plant ---------------------- Yankee will operate and maintain the plant in accordance with good utility practice and all applicable laws and rules and regulations thereunder, including the applicable provisions of the Atomic Energy Act of 1954. Yankee reserves the exclusive right to control scheduling of the operation and maintenance of the plant, including outages for inspection, maintenance, refueling, and repairs and replacements. Subject to the foregoing, and until otherwise determined by Yankee's board of directors, the plant shall be subject to central dispatch pursuant to Section 12 of the New England Power Pool Agreement dated as of September 1, 1971, as from time to time amended. 4. Customer's Entitlement --------------------- The Customer shall be entitled, throughout the term of this contract, to its power percentage of the capacity and net electrical output of the plant. 5. Deliveries and Metering. ----------------------- Deliveries will be made in the form of three-phase, 60- cycle, alternating current at a nominal voltage of 115,000 volts, at a step-up substation owned by Yankee at the plant site. The Customer will make suitable arrangements for the transmission of the electricity so delivered to it by Yankee. Yankee will supply all necessary metering equipment for determining the quantity and conditions of supply of all electricity delivered hereunder, and will maintain the accuracy of such equipment within limits of 2% up or down. In addition to regular routine tests, Yankee will have any such meter tested at any time upon the written request of the Customer, and if such meter shall prove to be accurate within 2% up or down, the expense of the test shall be borne by the Customer. Yankee will furnish the Customer monthly, or oftener if requested by the Customer, with a summary of the meter readings relating to the services rendered hereunder, and upon request will make available its metering records for the Customer's inspection and review. 6. Payment ------ With respect to each month commencing on and after April 1, 1985, the Customer will pay Yankee an amount equal to the Customer's power percentage of the total cost of service for such month to all customers of Yankee. The "total cost of service" for any month shall be the sum of (a) Yankee's operating expenses for such month with respect to the plant, plus (b) an amount equal to one-twelfth of the composite percentage for such month of the net plant rate base. "Uniform System" shall mean the Uniform System of Accounts prescribed by the Federal Energy Regulatory Commission for Class A and Class B Public Utilities and Licensees, as from time to time in effect. Yankee's "operating expenses" shall include all amounts properly chargeable to operating expense accounts, less any applicable credits thereto, in accordance with the Uniform System; it being understood that for purposes of this contract "operating expenses" shall include (I) depreciation or amortization accrued at a rate at least sufficient to fully amortize over the estimated remaining useful life of the plant Yankee's non-salvageable investments in plant nuclear fuel and materials and supplies or other assets, provided, however, that if a decision is made to cease electricity production at the plant prior to July 9, 2000, then such remaining non-salvageable investments shall be amortized over a period extending to July 9, 2000; (ii) obligations incurred in connection with the leasing of fuel inventory; and (iii) interest charges not associated with outstanding indebtedness; and (iv) costs incurred in connection with decommissioning the plant, including (a) the direct and indirect costs of operating, maintaining or dismantling the spent fuel storage facilities and other plant facilities after the cessation of electricity production and (b) the accruals to any reserve established by Yankee's board of directors to provide for physical decommissioning of the plant over the estimated remaining useful life of the plant, provided, however, that if a decision is made to cease electricity production at the plant prior to July 9, 2000, then the accruals to the reserve referred to in clause (b) shall be made over a period extending to July 9, 2000. The parties agree that the timing and amount of any billings by Yankee of the accrual referred to in the preceding clause (iv), and the Customer's continuing obligation to pay the same, are subject to the jurisdiction of the Federal Energy Regulatory Commission or its successor agency as provided by law. The aggregate amounts of the annual accrual to the decommissioning reserve shall be as from time to time approved by the Federal Energy Regulatory Commission, such amounts to be accrued in equal monthly installments. Consistent with paragraphs 1 and 2 of Section 6 of this Power Contract, monthly payments by the Customer to the decommissioning reserve shall be equal to the Customer's power percentage of the total decommissioning accrual for that month. Composite percentage shall be computed as of the last day of each month (the "computation date") and for any month the composite percentage shall be that computed as of the last day of the previous month. Composite percentage as of a computation date shall be the sum of (I) the annual percentage rate for return on equity then in effect as authorized by the Federal Energy Regulatory Commission multiplied by the percentage which equity investment (excluding any equity investment which relates to construction work in progress not included in net plant rate base) as of such date is of the total capital as of such date; plus (ii) the effective interest rate per annum of each principal amount of indebtedness (excluding any principal amount of indebtedness which relates to construction work in progress not included in net plant rate base) outstanding on such date for money borrowed multiplied by the percentage which such principal amount is of total capital as of such date. "Equity investment" as of any date shall consist of the sum of (I) all amounts theretofore paid to Yankee for all capital stock theretofore issued, plus all capital contributions, less the sum of any amounts paid by Yankee in the form of stock retirements, repurchases or redemptions or return of capital; plus (ii) any credit balance in the capital surplus account not included under (I) and any credit balance in the earned surplus account on the books of Yankee as of such date. "Total capital" as of any date shall be the equity investment plus the total of all indebtedness then outstanding for money borrowed. The "net plant rate base" shall be determined monthly and shall consist of (I) the aggregate amount properly chargeable to Yankee's utility plant accounts, including nuclear fuel accounts, in accordance with the Uniform System; less (ii) the amount of any accumulated provisions for depreciation and for amortization of nuclear fuel assemblies (exclusive of any decommissioning reserve); plus or less (iii) amounts recorded in accumulated deferred income tax accounts, as appropriate, in accordance with the applicable section of the regulation issued by the Federal Energy Regulatory Commission (which as of the date hereof is codified at 18 C.F.R. section 35.25); plus (iv) such allowances for materials, supplies, and prepaid items as may from time to time be determined by Yankee's board of directors; plus (v) allowances for cash working capital as permitted from time to time by the Federal Energy Regulatory Commission or its successor agency; plus (vi) the amount of any unamortized deferred expenses, as permitted from time to time by the Federal Energy Regulatory Commission or its successor agency; plus (vii) to the extent not provided for elsewhere in this paragraph, the remaining unamortized amount of the non-salvageable investment in plant, nuclear fuel and materials and supplies and other assets. Payments shall be made in cash promptly after receipt by the Customer of statements rendered by Yankee in such detail as the Customer may reasonably require. Such statements may be rendered on an estimated basis subject to corrective adjustments in subsequent billing periods. Simple interest at the prime rate then in effect at The First National Bank of Boston shall accrue on any payment delayed beyond thirty days after receipt by the Customer of a monthly statement. If any payment (other than amounts in dispute) shall be delayed beyond six months, Yankee may, by written notice, terminate this contract at the end of the next succeeding calendar month. Notwithstanding any other provision of this contract, the treatment of construction work in progress for purposes of any calculations relevant to the computation of monthly payments under this Section 6 shall conform to the applicable section of the Federal Energy Regulatory Commission's regulations respecting such items (which as of the date of this Amendment hereof is codified at 18 C.F.R. section 35.26), as such regulations may be modified from time to time. 7. Audit ----- Yankee's books and records, insofar as they pertain to the service rendered hereunder or to any charges made therefor, shall be open to the Customer's inspection and audit. 8. Arbitration ----------- In case any dispute shall arise as to the interpretation of this contract which cannot be settled by mutual agreement, such dispute shall be submitted to arbitration. The parties shall, if possible, agree upon a single arbitrator. In case of failure to agree upon an arbitrator within 15 days after the deliver by either party to the other of a written notice requesting arbitration, either party may request the American Arbitration Association to appoint the arbitrator. The arbitrator, after opportunity for each of the parties to be heard, shall consider and decide the dispute and notify the parties in writing of his decision. Such decision shall be binding upon the parties, and the expense of the arbitration shall be borne equally by them. 9. Regulation ---------- Performance of this contract is subject to all applicable state and federal laws and to all rules, regulations and orders properly issued thereunder by any governmental agency having jurisdiction in the premises. 10. Effective Date -------------- This revised contract shall become effective on April 1, 1985, subject to any suspension order duly issued by the Federal Energy Regulatory Commission. 11. Amendments ---------- Upon authorization by its board of directors of a uniform amendment to all customer power contracts, Yankee shall have the right to amend the provisions of Section 6 hereof by serving an appropriate statement of such amendment upon the Customer and filing the same with the Federal Energy Regulatory Commission (or such other regulatory agency as may have jurisdiction in the premises) in accordance with the provisions of applicable laws and any rules and regulations thereunder, and the amendment shall thereupon become effective on the date specified therein, subject to any suspension order duly issued by such agency. All other amendments to this contract shall be by mutual agreement, evidenced by a written amendment signed by the parties hereto. 12. Interpretation -------------- The interpretation and performance of this contract shall be in accordance with and controlled by the laws of the Commonwealth of Massachusetts. 13. Addresses --------- Except as the parties may from time to time otherwise agree, any notice, request, demand, statement, bill or payment provided for in this contract or any other notice which either party may desire to give to the other, shall be in writing and shall be effective upon delivery to the other party. Any such communication shall be considered as duly delivered when mailed by either registered or ordinary mail to the respective post office addresses shown following the signatures of the parties hereto. 14. Corporate Obligation -------------------- This contract is the corporate act and obligation of the parties hereto, and any claim hereunder against any stockholder, director or officer of either party, as such, is expressly waived." IN WITNESS WHEREOF the parties have executed this revised contract by their respective officers thereunto duly authorized as of the captioned date. EX-99 4 EXHIBIT B-1
YANKEE ATOMIC ELECTRIC COMPANY PRO-FORMA BALANCE SHEET 1998 1999 2000 ---- ---- ---- Balance Activity Balance Activity Balance ------- -------- ------- -------- ------- ASSETS ------ Life Insurance Surrender Value $1,386,036 $0 $1,386,036 $0$1,386,036 Funded Liabilities 8,011,348(5,568,273) 2,443,075(2,443,075) 0 Working Capital 10,697,158(7,765,630) 2,931,528 1,389,680 4,321,208 DOE D&D Fuel Payment 845,042 33,802 878,844 (878,844) 0 Account Receivable 6,801,852(6,001,852) 800,000 (800,000) 0 Prepaids 4,659,556 0 4,659,556(4,659,556) 0 Unrecovered Assets 8,920,847(5,957,183) 2,963,664(2,963,664) 0 Land/other 443,324 (306,364) 136,960 0 136,960 ------- ---------- -------------------- -------- Total Assets $41,765,163 ($25,565,500)$16,199,663($10,355,459) $5,844,204 ================================================== LIABILITIES & EQUITY - -------------------- Common Stock $15,340,000 $0 $7,340,000 $0$3,340,000 Retained Earnings 5,604,104 1,251,104 0 Net Income 2,090,000 450,000 Dividends/ share Dividends (6,443,000) (1,701,104) Return of Capital (8,000,000) (4,000,000) ------------------------------------------------------------ Net Equity $20,944,104 ($12,353,000) $8,591,104($5,251,104) $3,340,000 Accounts Payable Trust 7,710,084(6,110,084) 1,600,000(1,600,000) 0 Sale Reserves 2,725,531(2,725,531) 0 0 0 Retention/Severances 1,803,606 (325,000) 1,478,606(1,478,606) 0 FAS112 Rowe 0 0 0 NSD 0 0 0 0 Unqual. Pension/ Officers Medical 3,207,742(3,207,742) 0 0 0 Deferred Income Tax 4,707,666 (452,795) 4,254,871(1,750,667) 2,504,204 Other 591,128 (341,128) 250,000 (250,000) 0 ITC 75,302 (50,220) 25,082 (25,082) 0 -------------------------------------------------------------- Total Liabilities & Equity $41,765,163 ($25,565,500)$16,199,663 ($10,355,459) $5,844,204 ===============================================================
EX-5 5 EXHIBIT F-1 Exhibit F-1 ----------- September 30, 1999 Securities and Exchange Commission Washington, DC 20549 Re: Yankee Atomic Electric Company File No. 70- Gentlemen: This opinion is furnished to you in connection with the filing with you of the Declaration on Form U-1 (the "Declaration") of Yankee Atomic Electric Company (the "Company") under the Public Utility Holding Company Act of 1935, as amended, relating to the proposed repurchase by the Company of up to 90% of its outstanding Common Stock. We are counsel for the Company and in connection with this opinion we have reviewed the Company's charter, by-laws and the minutes of the meetings of the board of directors of the Company and such other materials as we deemed necessary to this opinion. Based upon the foregoing, we are of the opinion that, when the Commission has taken the action requested in the Declaration and when the shares have been tendered by all the sponsoring utilities and the repurchase price has been paid by the Company, all as described in the Declaration: 1. The Company is a corporation duly incorporated and validly existing under the laws of The Commonwealth of Massachusetts. 2. All State laws applicable to the repurchase of the shares of Common Stock as described in the Declaration will have been complied with. 3. The Company will legally acquire the shares of Common Stock being repurchased. 4. Consummation of the aforesaid repurchase of Common Stock of the Company will not violate the legal rights of the holders of any securities issued by the Company. We hereby consent to the use of this opinion in connection with the Declaration. Very truly yours, s/ Ropes & Gray Ropes & Gray EX-99 6 EXHIBIT G-1 Exhibit G-1 ----------- Yankee Atomic's Estimated Fees and Expenses - ------------------------------------------- Expense Type Estimate ------------ -------- Administrative Fees $2,500 Legal Fees $3,500 -------------------------- ----------- Total Estimated Expenses $6,000 =========================== ============ EX-99 7 EXHIBIT H Exhibit H --------- Proposed Form of Notice Yankee Atomic Electric Company ------------------------------ Yankee Atomic Electric Company ("Yankee"), 19 Midstate Drive, Suite 200 Auburn, Massachusetts, 01501, a subsidiary of New England Electric System and Northeast Utilities, both registered holding companies, has filed a declaration under Section 12(c) of the Act and Rule 42 thereunder. Yankee proposes to repurchase from its ten stockholders ("Sponsors") an aggregate of 145,730 shares of its Common Stock, 95% of the presently outstanding Common Stock, at a purchase price of $100 per share, the book value per share on June 30, 1999. The funds for the repurchase will be obtained by liquidating short-term investments held by Yankee at June 30, 1999. Yankee is a single purpose electric utility which formerly operated a nuclear powered electric generation facility (the "Rowe Plant"), the output of which was sold to Yankee's ten Sponsors. The Rowe Plant was permanently taken out of service in February, 1992 and Yankee is in the process of decommissioning the facility. Pursuant to Power Contracts between Yankee and each Sponsor, which have been approved by the Federal Energy Regulatory Commission, the Sponsors are continuing to make payments to Yankee to cover funds for decommissioning the Rowe Plant and waste disposal, amortization of plant investment and return on equity. As these obligations are reduced or provided for, Yankee believes its minimum equity requirements will also significantly decline. Therefore, Yankee contemplates this initial repurchase of Common Stock to reduce its equity. No other state or Federal agency has jurisdiction over this proposed transaction. EX-99 8 FINANCIAL STATEMENT 1-1 Yankee Atomic Electric Company BALANCE SHEET ASSETS As of June 30, 1999 (UNAUDITED)
June December 1999 1998 -------- -------- UTILITY PLANT AT ORIGINAL COST Electric Property at Original Cost $136,960 $136,960 Total Utility Plant 136,960 136,960 CURRENT ASSETS Cash and Cash Equivalents 11,920,155 15,747,433 Restricted Cash 0 3,000,000 Accounts Receivable Service 526,735 883,757 Other 3,230,228 3,298,028 Prepayments 6,965,948 6,938,200 Total Current Assets 22,643,066 29,867,418 DEFERRED CHARGES AND OTHER ASSETS Trust Funds Plant Decommissioning 153,450,025 150,659,185 Regulatory Assets Closure 40,757,375 61,378,901 Net Unrecovered Assets 5,961,162 8,920,847 DOE Decontamination and Decommissioning Fee 10,820,736 12,229,138 Other 204,250 306,364 Other Deferred Charges and Other Assets 4,285,483 4,516,787 Total Deferred Charges and Other Assets 215,479,031 238,011,222 TOTAL ASSETS AND OTHER DEBITS $238,259,057 $268,015,600
Yankee Atomic Electric Company BALANCE SHEET STOCKHOLDERS' INVESTMENT AND LIABILITIES As of June 30, 1999 (UNAUDITED)
June December 1999 1998 -------- --------- CAPITALIZATON Common Stock $15,340,000 $15,340,000 Retained Earnings 3,430,051 5,604,104 Total Capitalization 18,770,051 20,944,104 CURRENT LIABILITIES Accounts Payable 137,441 136,859 Accounts Payable to Associated Companies 452,046 6,875,086 Accrued Interest and Taxes 1,572,687 (1,551) Other Current Liabilities 1,319,100 3,979,477 Total Current Liabilities 3,481,274 10,989,871 RESERVES AND DEFERRED CREDITS Reserves Plant Decommissioning 153,450,025 150,659,185 Deferred Credits Regulatory Liabilities Closure 40,757,375 61,378,901 DOE Decontamination and Decommissioning Fee 10,539,055 11,384,096 Other 31,154 46,736 Accumulated Deferred Income Tax Liabilities 3,094,481 4,576,648 Unamortized Investment Tax Credits 50,192 75,302 Other Deferred Credits 8,085,450 7,960,757 Total Reserves and Deferred Credits 216,007,732 236,081,625 TOTAL LIABILITIES AND OTHER CREDITS $238,259,057 $268,015,600
EX-99 9 FINANCIAL STATEMENT 1-2 Yankee Atomic Electric Company STATEMENTS OF INCOME AND RETAINED EARNINGS For June 30, 1999 (UNAUDITED)
CURRENT MONTH YEAR TO DATE ------------------------------------- -------------------------------------- 1999 1998 1999 1999 1998 1999 ACTUAL ACTUAL BUDGET ACTUAL ACTUAL BUDGET ELECTRIC OPERATING REVENUE $3,778,030 $4,088,600 $4,002,000 $24,375,385 $24,521,397 $24,012,000 OPERATING EXPENSES Fuel Disposal Cost 93,894 92,399 95,000 563,361 554,395 570,000 Operation and Maintenance 9,067 58,879 25,000 517,086 188,429 150,000 Amortization of Unrecovered Assets496,764 496,432 497,000 2,977,099 2,978,592 2,982,000 Decommissioning Collections 3,284,250 3,284,250 3,284,250 19,705,500 19,705,500 19,705,500 Taxes Federal and State Income (166,751) 38,123 (15,650) 215,156 305,039 (93,900) Total Operating Expenses 3,717,224 3,970,083 3,885,600 23,978,202 23,731,955 23,313,600 OPERATING INCOME 60,806 118,517 116,400 397,183 789,442 698,400 OTHER INCOME/(EXPENSE), NET Other, Net 25,125 101,034 9,333 337,175 (173,163) 56,000 Total Other Income/(Expense), Net25,125 101,034 9,333 337,175 (173,163) 56,000 INCOME (LOSS) BEFORE INTEREST 85,931 219,551 125,733 734,358 616,279 754,400 INTEREST CHARGES Other Interest 0 0 0 0 30,403 0 Total Interest Charges 0 0 0 0 30,403 0 DISCONTINUED OPERATIONS Sale of NSD 0 174,866 0 277,508 2,015,832 0 Income Taxes 0 (19,119) 0 (117,919) (799,943) 0 Sale of NSD, Net 0 155,747 0 159,589 1,215,889 0 NET INCOME (LOSS) $85,931 $375,298 $125,733 $893,947 $1,801,765 $754,400 SHARES OF COMMON STK OUTSTANDING 153,400 153,400 153,400 153,400 153,400 153,400 EARNINGS PER SHARE OF COMMON STK $0.56 $2.45 $0.82 $5.83 $11.75 $4.92 RETAINED EARNINGS Retained Earnings - Beginning $3,344,120 $10,171,572 $6,232,771 $5,604,104 $8,745,105 $5,604,104 Net Income (Loss) 85,931 375,298 125,733 893,947 1,801,765 754,400 Subtotal 3,430,051 10,546,870 6,358,504 6,498,051 10,546,870 6,358,504 Dividends Paid 0 6,979,700 0 3,068,000 6,979,700 0 Retained Earnings - Ending $3,430,051 $3,567,170 $6,358,504 $3,430,051 $3,567,170 $6,358,504
-----END PRIVACY-ENHANCED MESSAGE-----