ML022610331
| ML022610331 | |
| Person / Time | |
|---|---|
| Site: | Diablo Canyon  |
| Issue date: | 09/11/2002 |
| From: | Maeda L Howard, Rice, Nemerovski, Canady, Falk & Rabkin, Pacific Gas & Electric Co |
| To: | Office of Nuclear Reactor Regulation, US Federal Judiciary, Bankruptcy Court, Northern District of California |
| References | |
| 01-30923 DM, 94-0742640 | |
| Download: ML022610331 (8) | |
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-$WAR" 13 NEM90C'SU cAN 14 "15 16 UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION
-PACIFIC GAS AND ELECTRIC COMPANY, a California corporation, Debtor.
T7,-1, r,.1 I T) No 0742640
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-- Case No. 01-30923 DM' Chapter 11 Case Date:
October 2, 2002 Time:- 9:30 a.m.
Place:
235 Pine Street, 22nd Floor San Francisco, California,
"- DECLARATION OF LANCE MAEDA IN SUPPORT OF MOTION FOR AUTHORITY TO INCUR-ADDITIONAL MISCELLANEOUS IMPLEMENTATION EXPENSES I.
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DECLARATION OF LANCE MAEDA JAMES L. LOPES (No. 63678)
JANET A. NEXON (No. 104747)
JULIE B. LANDAU (No.-162038)
HOWARD, RICE, NEMEROVSKI, CANADY,
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_,FALK & RABKIN A Professional Corporation Three' Embarcadero Center,`7th Floor San Francisco, California 94111-4065 Telephone: '"+415/434-1600 Facsimile:
415/217-5910.
Attorneys for Debtor and Debtor in Possession PACIFIC GAS AND ELECTRIC COMPANY 4
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I, L-a-c Maeda, de6laie*:
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'f am employed by Pacific Gas and Electric company ("PG&E")- the debtor "and debtor-ifn-possession i;nthis'Chaliter 11 cs6. I haVe been employed by PG&E since "1996 and hold the position-ofDiriecior of Applicati6n Developi'nent & Support,. In this positon,; I amrep'ors ible for fe*Iiical oversight of informatio'n technology ("IT")sof are
ýrdsetg'i thi'P&E
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I e1oficatiol Syser~lh fs ardTehifo l '
.r6ject§W.ithinCPG&B§ Iifoi.ii6tioi Sysiefis anid Techri" dal Services department; I also hdve conompany-wide resp rsibilit'i*in'th& IT area,-inludirg responsibility for creatifig and implementing plans, policies and procedures for PG&E's IT software activities and for supervisifngemployees efgg~ged m systems development and sbpport functions. In connedtionwith implementation of PG&E's'prop6sed'Plan of Reorganizatiorr (as amended from time to time, t"'Pli~n"); my s'pecific resi"bnsibiliti&'inýlude. identificatiofi of appli~cations thtitwll be needed by th6 N tr Efitifiifintegr-atedgtesting of applihat ions.
migrating from PG&E to flie&'Ne*.Entities, and defining gecurity strategie-for apphicMions to ýbeused.Y. the Ne" "Ehtifies 1
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tes-'"r-,v 9 This d6cl1aratin 'i~s'submifted in sigport of RG&E's Motion-for Authority S
'i6 Ii~ur Additioal Mi'seellane'dus Im'plei ieniatibn Expenses (the "Motion")..Defined. terms used herein shall ha'Ve the meanings'set forih thie`fMotion.- I make this declaration based on pefsonal kfiowledge, e) ept where otherw~ise indi'ated, and if called as a witness, could arid wýrouird'testify c6l'efiteritlfý16'ttie matters'set forth herein.
r 3. 'Sdftware ticieses-and Related Services! 'Currently, PG&E Corporation provideg certain'sei'Vices t6 PG&E utiliiifigs'oftware prodflicts that are-licensed by PG&E Corporation. As a result of t'he separati6n uýde the Plan", PG&E must purchase and install "several software products so"tha it'wili b6 able' to perform these.functions internally.. The total costs for these software'licenses and related training and siipport services is approximately $9,200. The types of software licenses that'PG&E will need to purchase include: (i) software used to track employee contributions td PG&E'spolitical action.
conmmittee; (ii) software-u~ed to-manage PG'&E's.pension rnd'ension benefits funds; (iii)
"software used to train PG&E'employees over the Internet on business'ethics and compliance DECLARATION OF LANCE MAEDA
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,*26 27 28 with legal and regulatory requirements; (iv) software used,to track risk management and ifisurance requirements;',ad (v) softwareused for taxi:,eturn preparation and tax solutions.
-The for'eging software licenses must be purchased promptlyto.allowyu for time to install and bonfigure the software, as p art of a particular business system, or set -of business..
,prcesses, to test the installation,'. and,' in some 'cases, to convert existing data or create separate databases "to accourit for the.separation.of PG&E from the Ne,.ontities.w s,
,,G&E requires
.additional time to provide instruction and training to, the employees who will be using the various software products.
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StockOption Plan. :PG&E Corporation currently administers a stock option plan for PG&E.employees who hold options :to~purchase PG&E Corporation stock.
Pursuant to the Plan, employees who hld potions to purchase, PG&E Corporation _tock will t'also-be granted Options to purchase PG&E stockl which will be publicly traded after the
-Plhir Effective Date..-Therefore, :PG&E will-require a, new PG&E stock option plan, which it will administer for all individuals who are granted PG&
.-stock options. PG&E haI selected
- Salombn'Smith Barney, a. rnember pf Citigroup Q.tSalomon'), to develop a system for administering the new stock option plan. Salomon provides corporations with a range of "corpbrate financial services,,including stock option plan seryices. Theprocess of developing and'implementing the new stock,option plan is expected to take approximately three months.' Specifically, Salomon,will:, (J),,design and develop. a system to administer the
'stock option plan, including the online.access features, (ii) install andtest the system, (iii)
"set 'ip accountsfor option-holders,,and (iv) develop,a communication. plan to inform,option
,holders on how to use the.newsystem.. All of these tasks must becompleted by the Plan Effective Date, since option'holde;s may wish to exercise their options imrnmediately after
'the Plan Effective Date., Salomon will.provide these services to PG&E for a cost of apprdximately $25,000..!This cost includes'an initial set-up fee. of,$5,000, which PG&E will
-'be required to pay even if the.project is cancelled before completion*.:-:-
5...., Human Resources Software for the New Entities.; PG&E has identified a nun to obtain the software, as well as to install, configure and.test it so that all critical tluman DECLARATION OF LANCE MAEDA ib 4
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. 23 24 "25' 26 27.1 28 resources fiinctions, will eb iifpJace-for the New Entities by the Plan Effective Date. PG&E will obtain the ificessary software licenses but the licenses will be transferable to tlhe.New Entities-uponthe elan Effectie Date. If the Plan is not'confirmed, PG&E anticipates that it
-will be able to.use-all pf.the software tools described below, which.represent current (and
-therefore upgradedyversions of software already.in use by-PG&E. The software identified below relates: to additionglhu.man.:resource requirements, that have not been covered in the previous motions co'iering human resource e xp.qnses.
a.-,- Random Drug Testing: :"Heidi/Assistant!',is asoflware tool currently used "byPG&E to manag6.r4ndom'0rug testing of certain classes of employees in order to comply with Departnfent of-Transportatij.pnregulations.. The' New Entities will also be subject to the "Departnment of-Transporitatjon, rg:ulatioris requiring certain classes ofemployees to be.
randomly drug-tested. Therefore' PG&E intends topurchase a similar. sof.warelicense for the New Entities, froimC6mpliace-Information Syst'ems for approximately $6,590,' which includes the, software andlsupport. for 2,500, tests peryear:.
- b. :,, Affirmativý Action, Plan: "'Greai AAP" is a.software tool currently used by PG&E to cr~ate:*ifid! mrnage-affirmative action plans -to:comply wjth, state-and, federal, regulations. -The New Entities" will also require this-tool tomanage their affirmative action plans., PG&E intefids to. purchas& this" software license fromr Berkshire. Associates, Inc. for approximately $2,,995.,
.w'hich: inclu'des thdeGreatAAP Master, Edition Single License, and one yeat of technidal support2.
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TiainihnManagement: "Training, S.ei-ver" is a-software tool currently used by PG&E to manage trainiiig classes, training classenrollment and employee training records. It is currently the sole repository for PG&E-employeetraining records. These "training certifications aie nec ssary to ensure that employees can continue to safely perform
'their jobs and o05eiaie certain specialized equipment. Therefore; the New Entities will require this software tool to. track employee,taining records as well, including the records for cuirrent. PG&E empl6yees who may work for the New Entities. PG&E intends to>
purchase this software license from THINQ Learning Solutions Inc..for approximately
'DECLARATION OF LANCE MAEDA 1
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-$202000.~
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'e, THhNQ willprovydes -instlain-spconfigur6btatin aondetinge fto'rf this required Em'pl6n~ions Thestin&'A "Sca ETools"' I.il oaldrqithi-ofare tool torntyusdb
-currenl tusoeda by'PG&bbiecardscanfier (used toh66?ea'pre-erhlsoytwaento ande employ-eetes) required johee funtion.Te§,
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Etiis'ill als eie hs-&faen requite hisofwae toolto.
.PG&E intends to piirchas e the Scati Tools softwA're lidense fTrom NCS -P6ýar~on -for
_,Vprokimately $1,725 iffd 'the -EEI Scatinfer softw~rcii~ense'frofriithe Edison-:Electric:
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~n t.ThrtheNew Entities; -By th~e:Plan
-Effective'Date, the New -Efitities w~ill require cerlinroft-ware'and IT applications to handle,'
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-ad m'oiiy-manageinbiit ervrices.-' The..sofiw-are ahd'a'pplications described h'ereiii
-involvepeiled dfniignd mbondy--managernint ~oftware' that *have not bein 'coveted in thie pie'- idiu motions approvinfg~oftware and 4T7 appliat~i npurchies.G& itdst pur6hase'licenges for d6rtfaiii specid.lized s'oftware products; v~hich~niust b& installed aiid f&8tedT f&uis,& by 1te New Entities' (the'licenises'wil
tra~nsferable to-'the New Entities -upon the Plan Effective Date). In additior4 e~xistifig bah'kifig affd. mnoney management. data muist be
~s~ae'foi'GEand trdnsferk.ed.tc the ~picatiionsi~o ibe used by the New Entiti~s.
The ba~fiking'and-fniondy maifiagemeflt projects-'described below are e'pected t6xtak6
'appr~xini&6ly'thiee' to Tfoir monibs to'bomp lete',\\hich iriclud~s the sbftware install~ation as
'well i~s-the's~piirat1ifi'affd tra~nsfer'of data.' -
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'C sManip~eiiienfSoftwre and RI t~id 'Services. PG&E currently
'lice'diesRe~soif66,IQ s'oftware, which it uses to'Thanage'fts *daily 'caish position and to record
.bafikiiig ftaný,a&tions'to tht general ledger acoitn syte.
'Terfeorte w
Eniit~-PG&
inteds ipurchase a s'irfiilar lic ense'from' Sung "'rd TireasurySytm DECLAKRATION OF LANCE MAEDA 1:
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("Sunguard"), a banking-software specialist, at a cost of approximately $110,950. Software consultants from Sunguard:will. assist with the installation, configuration and.--,
"implementation: of ResourceIQ~at an additional cost of approximately $32,000...In addition, PG&E will-,purchase. a license for Mellon Bank'sTelecash software for the NewjEritities at a cost of approximately $350. This software is used to approye wirpe-transfers of money to and from Mellon Bank initiated through the Resource IQ sqftware systemn.
b., -. Bankihig Relationship-Software, and Related-Services. EG&E currently uses Banking.RelationshipLManager software.to analyze banking fees and~services. For the New Entities, PG&E will purchase a, license,forBanking Relationship-Manager software from The Weiland Financial Group ("Weiland"), a, financia.1 services consulting. firm,. at a cqst of approximately,S20,500: -Weiland will alsb provideone or rnore:consultants who will assist PG&E:in separating.the data-currently stored in-the-Banking Relationship Manager software
, used by PG&.:,.The, cost for the: consultants'- *ervices will. be approximately $2,000.
- c. %, Project Management. -PG&E has.selected Bort and.Companyi Inc., a.cash management consulting.firm, to-provide project management servicesin conneption with the
-implementation of the banking ind inoney management processes for.the New Entities at a
-cost of approximately $30,000: -These services.will include scheduling, tracking anfd "reporting on the status of the foregoing banking and money management projects.
- 7. *, Electronic'Data Interchange. GE Global.Exchange Seirvices currently.
"provides an Electronic Data Interchange ("EDI"') program for-PG&E's purchasing 6nd accounts payable functiohs.. TheEDI Program allowsOPG&E to communicate electronically with itS" vendors, and exihangý *purchase orders, purchase order changes and invoices electronically., It also permits PG&E to pay vendors via Electronic Funds Transfer.I PG&E has found that the EDI program reduces its costs and improves the overall efficiencies of its operations. Therefore;PG&E has decided to install the EDI program for the New Entities to ensure a smooth transition upon separation and to avoid inefficient and potentially inaccurate payment processing by the New Entities. :,PG&E has selected GE Global Exchange Services to provide a similar EDI: program for the New Entities. This will include analysis of current DECLARATION OF LANCE MAEDA I
1 PG&E procedures, including special processes andreporing,'modifications toyarious 2
aspects of the existing EDI program to meet the special requirements of the New Entities, - setting-iup'the Electroniic Furnds'Transfer.system; adding an.ilectronicconnection between 4
'GE dlobal Exchange Services~and the New Entitibs),and festing andimpleihentatioh of the 5
new EDi progrn amwith-approximately 250 vendorf. Thii projectis expected to take:
6 approximately four-months'to complete. The set-up cost is $40,000 and the additional
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'estimated cost for irnplemehting the system is'$5_0,O009-. The' set-up cost of $40,000 cannot 8
be avoided even if the. contract is subsequently'canceled before cofnpletionof the project.
- 9. 'The remaining'$50,000 is baaed-on-time and expenses'and thdrefore-could~be partially or 10 fully avoided upon'contract termination.'
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-The cost estimates set fo'th abovear*ebasdd bn PG&E's initial scoping of 12 the project requirements and'negotiafions with the'.consultants who have been.selbcted to
.1 HOWAIRD 13 t6rform the work (or preliminary discussions with the'potential consultants,, as noted below).
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14 For each of the constiltirig flims,.PG&EW's standard.contr.ictual-provisions in place with these
& RA~K1N "15 fitins (or to be included in any contracts tobe executed,hereafter) do not guarantee future':'
16 work'or any riminimum amount ofrevenue. PG&E will~als6 maintain the right to.ter"minate 17 the'work at any time withoutacuse, in which cdae PG&E-is liable. only for work performed 18 to.the date of termination plus costs reasonably incurred by the consultant in terminhting any 19
'work inprogress.. Theie are a fewv exc.ptipins noted above, where PG&E has been unable to 20 obtain the services without payipg An initial set-up :or flat fee, which cannot be recovered if 21
,the work'is subsequently termindted. In additi6h, th6 software license fees described herein 22 involve one time charges thai'cannot be recovered if the work is subsequently terminated.
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'22, 23' 24 25 26' 27 28 I declare under penalty of perjury,. of the laws of the United States~that, the, foregoing is true and correct, and that this declaratib~n was executed atb San -Franc'is',
California on Septemhber II 2002-.,..
WD 090902/11419905/1021907/vI l 1%
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- DECLARATION OF LANCE MAEDA -
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