ML20066G619
| ML20066G619 | |
| Person / Time | |
|---|---|
| Site: | Seabrook  |
| Issue date: | 01/22/1991 |
| From: | SECURITIES & EXCHANGE COMMISSION |
| To: | |
| Shared Package | |
| ML20066G596 | List: |
| References | |
| NYN-91008, NUDOCS 9101280133 | |
| Download: ML20066G619 (407) | |
Text
{{#Wiki_filter:. . . . i-New Hampshire Yankee January 22, 1991 l l l I l ATTACHMENT 1 TO NYN.91008 l ' l I
.I urma myte P
i l FILE NO. 70-v )- -- SECURITIES AND EXCHANGE COMMISSION Washington,-D.C. 20549 FOR.N 0-1 APPLICATION / DECLARATION WITH RESPECT TO THE PROPOSED ORGANIZATION AND CONDUCT OF BUSINESS OF NORTH ATLANTIC ENERGY SERVICE COMPANY Under THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 North Atlantic Energy Service Northeast Utilities Company 3
-174 Brush-Hill Avenue- Route 1, Lafayette Road West Springfield, MA 01090-0010 Seabrook, NH 03874 l NortheastLUtilities Service Company Yankee Atomic Electric Company 1071Selden-Street 580 Main Street Berlin, CT. 06037-0218 Bolton, MA 01740
-(Names of companies filing this statement
-and addresses of principal executive offices)
() NORTHEAST UTILITIES (Name of. top registered holding company) Walter F. Torrance', Jr., Esq.
.6enior Vice President, Secretaryfand-General Counsel '
Northeast Utilities Service Company 107 Selden Street Berlin, CT 06037-0218: (Name and_ address of agent for-service)- 1
- The' Commission is requested to mail signed; copies of_all-orders, ,
notices and communications to John F. Opeka Gerald-Garfield,LEsq.- . Executive Vice-President _ Day,1 Berry & Howard Engineering and. Operations Northeast Utilities Service Company CityPlace P.O. Box 270
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Hartford,fCT 06103-3499- ' Hartford,.CT 06141-0270-- _ Robert E. Busch . John B.fKeane,-Esq.* Senior Vice President and Associate General Counsel Chief Financial l Officer Northeast 1 Utilities Service Company ' Northeast Utilities Service Company - LP.O.EBox 270- -P.O. Box 270 Hartford, CT 06141-0270 j , Hartford, CT 06141-0270 4
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ITEM I ( m DESCRIPTION-OF PROPOSED TRANSACTIONS INTRODUCTION i
- 1. Northeast Utilities ("NU"), a public utility holding
' company registered under the Public Utility Holding Company Act of 1935, as amended (the "Act"), North Atlantic Energy-Service Company ("NAESCO"), a to-be-formed electric utility company and- p service company subsidiary of NU, Northeast' Utilities Service Company--("NUSCO"), a service company subsidiary of NU, and-Yankee' Atomic Electric Company ("YAEC"), an electric utility company i subsidiary of NU and New England Electric System (collectively,: ,
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cthe." Applicants"). submit this application / declaration (the ; 10, and 13 of [(['" Application")'pursuanttoSections6(a),7,9(a), n the Act:and the rules thereunder, with respect to certain -
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transactions related to the formation and capitalization of b NAESCO. At the request of-the staff of the Commission's 0ffice-of Public1UtilityfRegulation, this Application is-being submitted one. Form U-1. .NAESCO'will be formed to manage, operate and maintain 1Seabrook. Unit'No. 1-("Seabrook"), anL1150 megawatt-
. nuclear-power-plant located?in'Seabrook, New-Hampshire. NAESCO:
I: HV will alsoibe1 responsible.for supervision of the; disposition of E iSeabrookEUnit1No. 2,.a cancelled nuclear unit on-the same. site as iSeabrookLUnit No. 1. NAESCO will notthave an: ownership interest 4 inLSeabrook or Seabrook-Unit No. 2 or an entitlement to anyfof-
'theJeapacit'yEor energy therefrom.
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- 2. This proposed transaction is a part of the overall proposed acquisition of Ptblic Service Company of New Hampshire l
("PSNH") by NU which is scribed in the application / declaration of NU and NUSCO an File No. 70-7695, as amended, and which was approved by the Commission in its Memorandum Opinion and Order issued December 21, 1990. The application in File No. 70-7695 seeks the necessary Commission approvals of all aspects of NU's proposed acquisition of PSNH except those related to NAESCO, and the December 21, 1990 order approved that acquisition and certain related transactions, reserving jurisdiction over other transactions. The only approvals sought in this Application are () those related to NAESCO's formation, capitalization and conduct of business.
- 3. The acquisition transactions, in relevant part, can be described as follows:
PSNH, the owner of an approximately 35.6 percent interest in Seabrook, is currently authorized under U.S. Nuclear Regulatory Commission ("NRC") Operating License NPF-86 to manage, operate and maintain Seabrook on behalf of itself and the 11 other joint owners of the unit (collectively, with PSNH, the
" Joint Owners"). Since 1984, PSNH has performed those functions O
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a i for Seabrook through/its New Hampshire Yankee Di rision ("NiiY") .1
- After suffering through financial problems for most of the.1980s caused in large part by-its sizeable investment in Seabrook, PSNH-filed in United States Bankruptcy Court, District of New Hampshire (the " Bankruptcy Court"), in January , 1988 a petition seeking protection from its creditors under Chapter 11 of.the 1
U.S.-Bankruptcy Code.- NU became interested in acquiring PSNH, 1 and, in-December, 1989, after intense negotiations between NUSCO,.on behalf of NU, and .he official committees representing ' PSNH's unsecured-creditors and equity. security holders, and the j holders of a majority of PSNH's third mortgage-bonds, those
. parties filed with the Bankruptcy Court a Joint Plan of Reorganization for PSNH. PSNH 1ater endorsed the Plan-and became +
a co-sponsor of the final version of +he Joint Plan as-it was filed with the Bankruptcy Court on January 2, 1990 and
- subsequently confirmed by the Court (the " Plan"). The Plun has also been~ supported by the State of New Hampshire.
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'4 . - - The Plan contemplates, inter alia, (i) the. acquisition of PSNH's common stock by NU,-(ii) the transfer of:PSNH's-
- ownership interest in seabrook (the!"Seabrook Interest") toENorth! 1 Atlantic EnergyfCorporation ("NAEC"), a to-be-formed electric 1 An application was submitted in 1986 in File No. 70-7214 to. create:a separate corporation owned-by the Joint Owners
'( to perform the functions currently performed by NHY. That s proposal is no longer being pursued.
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I utility subsidiary of NU, (iii) the assumption by a wholly owned subsidiary of NU (which will be NAESCO) from NHY of the responsibility for managing, operating and maintaining Seabrook and supervising the disposition of Seabrook Unit No. 2, and (iv) the issuance by each of NU, PSNH, NAEC and NAESCO of certain securities in connection with the Plan. The Plan is structured to provide for NU's acquisition of PSNH in a one-step transaction in which NU would acquire all of a new issue of PSNH common stock
-concurrently with the cancellation of all of PSNH's currently outstanding stock if certain conditions, most notably the acquisition of required regulatory approvals, are received in
/~'g time. If those conditions are not met in time, the acquisition V would occur.in two steps, with PSNH emerging from bankruptcy at step one as a stand-alone entity owned by its current unsecured creditors and equity security holders and committed by an order of the Bankruptcy Court to a merger with a wholly-owned subsidiary of NU, and with NU acquiring the reorganized PSNH at step two through that merger. In either the one-step or the two-step transaction, PSNH's Seabroch Interest would be transferred to NAEC at or shortly after the time NU's acquisition of PSNH is consummated. The Applicants currently expect the transaction to occur in two steps.
- 5. As stated above, in accordance with the Plan, NAESCO will be formed to assume from NHY the responsibility for (s)
1 L l n) managing, operating and maintaining Seabrook and for supervising the disposition of Seabrook Unit No. 2. In March, 1990, Seabrook received its full-power license from the NRC and on May 29, 1990, it was synchronized to the New England grid. The unit successfully completed power ascension testing in August, 1990. The 12 Joint Owners, and their ownership shares in Seabrook, are as follows: Joint Owner Ownershio Percent Public Service ..ompany of New Hampshire 35.56942 The United Illuminating Company 17.50000 EUA Power Corporation 12.13240 Mass. Municipal Wholesale Electric Co. 11.59340 New England Power Company 9.95766 The Connecticut Light and Power Company 4.05985
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Canal Electric Company 3.52317 Montaup Electric Company 2.89989 New Hampshire Electric Cooperative, Inc. 2.17391 Vermont Elec. Gen. and Transmission Coop. .41259 Taunton (Mass.) Municipal Lighting Plant .10034 Hudson (Mass.) Light & Power Dept. .07737
- 6. After its acquisition by NU, PSNH will cease to own an interest in or operate Seabrook, and NAEC will hold the Seabrook Interest. NAESCO will be an electric utility company and a service company subsidiary of NU and, as explained in paragraph 15, it will manage, operate and maintain Seabrook and supervise the disposition of Seabrook Unit No. 2 once certain conditions
-have been met, which may occur prior to NU's acquisition of PSNH.
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- 7. The Plan was confirmed by the Bankruptcy Court in an order dated April 20, 1990. NU and PSNH are currently proceeding with applications for necessary regulatory approvals and working toward satisfying the other conditions for both step one and step two of the two-step transaction.
DESCRIPTION OF NAESCO
- 8. Because NAESCO, as the operator of Seabrook, will be involved in the " generation . .
. of elcetricity ultimately sold to the public," it will be a "public utility" for New Hampshire ~T law purposes under Section 362:2 of the New Hampshire Revised (O Statutes and must be a New Hampshire business entity under Section 374:24 of the New Hampshire Revised Statutes. N.H.-Rev.
Stat. Ann. SS 362:2, 374:24 (1984). NAESCO will be a New and its Hampshire corporation, wholly owned and controlled by NU, principal executive offices will be located at Route 1, Lafayette Road, Seabrook, New Hampshire. l l 9. NAESCO's sole business will be providing managerial, l operational and maintenance services to the Joint Owners under ! the-Managing Agent Operating Agreement (the "MAOA") (Exhibit B.1) and the Disbursing Agent Agreement (the "DAA") (Exhibit B.2), described in paragraphs 15 to 21 herein. NAESCO's associate company customers within the NU system will be The Connecticut ()
Light and Power Company ("CL&P") and NAEC (after NAEC receives the transfer of the Sec. brook Interest from PSNH), two NU electric utility company subsidiaries. A statement of the gross operating i revenues of CL&P for the last available 12-month period is filed herewith as Exhibit H. (Because NAEC will be a newly formed I company with no history of gross operating revenues, no statement of gross operating revenues is being filed for it.) NAESCO will perform the same services for the other Joint Owners listed in paragraph 5 as it does for CL&P and NAEC.- Although it is not presently contemplated that NAESCO will provide services to non-affiliated companies other than the non-affiliated Joint Owners, p NAESCO reserves the right to do so and will file with the Q Commission the appropriate notice at least 60 days prior to the commencement Of the provision of such services.
- 10. It is presently expected that NAESCO's only authorized class of stock will be one class of common stock, $1 par value, of which 1,000 shares will be authorized and issued to NU as NAESCO's sole common stockholder. NU will pay $10 per share, or
$10,000 in the aggregate, for those shares,
- 11. The Applicants do not presently anticipate the need for NAESCO to raise any capital besides that supplied by NU's purchase of its common shares. As described in paragraphs 19 and 20, NAESCO viill be entitled to payment in full by the Joint
l Owners for the costs it will incur in performing its duties in advance of performing those duties, and because of this assured cash flow to pay its expenses prior to those expenses coming due, it is not expected to require additional capital. If the need for additional capital does arise, the method for raising that capital will be the subject of one or more subsequent applications.
- 12. NAESCO has not yet been formed, and accordingly currently has no property. NHY currently acquires property only as agent, acting on behalf of the Joint Owners, who hold the title to that property. This arrangement will continue after NAESCO assumes from NHY the responsibility for managing, operating and maintaining Seabrook. Therefore, NAESCO will not own any property.
- 13. Initially, NAESCO's operations will be governed by three agreements -- the MAOA, the DAA, and the Agreement for Joint Ownership, Construction and Operation of New Hampshire Nuclear Units (the "JOA") (Exhibit B.3), and it will have a service contract with NUSCO (Exhibit B.4) and a service contract with YAEC (Exhibit B.5). These agreements are described in paragraphs 15 to 25. Acting through NHY, PSNH will assign to NAESCO, as agent of the Joint Owners, and NAESCO will assume, NHY's rights and obligations under various contracts entered into
v on behalf of the Joint Owners with respect to the management, operation and maintenance of Seabrook.
- 14. The following is a list of the prospective directors of NAESCO, their connections with associate companies of NAESCO, and the approximate percentages of their total working time that initially will be devoted to NAESCO on an annual basis. With the exception of Mr. Feigenbaum, none of these directors will receive any compensation directly from NAESCO.
William B. Ellis - Chairman and Chief Executive Officer - NU, The City & Suburban Electric & Gas Company ("C&SE&G"), The Connecticut Steam Company (" Steam"), The Connecticut f']) (_ Transmission Corporation (" Transmission"), Electric-Power, Inc. (" EPI"), and the Nutmeg Power Company (" Nutmeg"); Chairman, Chief Executive Officer and Director - CL&P, NUSCO, Northeast Nuclear Energy Company ("NNECO"), Western Massachusetts Electric Company.("WMECO"), Holyoke Water Power Company ('HWP"), Holyoke Power & Electric Company ("HP&E"), Charter Oak Energy, Inc. (" Charter Oak"), Charter Oak (Paris), Inc._(" Paris"), the Quinnehtuk Company i ("Quinnehtuk"), and The Rocky River Realty Company (" Rocky River"); approximately 5% of time to be devoted to NAESCO annually. l Bernard M.-Fox - President and Chief Operating Officer - NU, C&SE&G, Steam, Transmission, EPI, and Nutmeg; President, Chief Operating Officer and Director - CL&P, NUSCO, NNECO, WMECO, HWP, HP&E, Charter Oak, Parie, Quinnehtuk, and Rocky River; Director - YAEC, Vermont Yankee Nuclear Power Corp., and Maine Yankee Atomic Power Company; approximately 5% of time to be devoted to NAESCO annually. John F. Opeka - Director and Executive Vice President, Engineering and Operations - CL&P, NUSCO, NNECO, WMECO, HWP, HP&E, Charter Oak, Quinnehtuk, and Rocky River; Director - YAEC, Vermont Yankee Nuclear Power Corp., and Maine Yankee Atomic Power Company and member of Executive Committee of f.s YAEC; approximately 30% of time to be devoted to NAESCO k- annually.
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l l l Robert E. Busch - Senior Vice President and Chief Financial j Officer - NU, Paris, C&SE&G, Steam, Transmission, EPI, and Nutmeg; Director, Senior Vice President and Chief Financial Officer - Charter Oak, CL&P, NUSCO, NNECO, WMECO, HWP, HP&E, Quinnehtuk, and Rocky River; approximately 5% of time to be devoted to NAESCO annually. John f. Cagnetta - Director and Senior Vice President, Corporate Planning and Regulatory Relations - Charter Oak, CL&P, NUSCO, NNECO, WMECO, HWP, and HP&E; Executive Vice President and Director - Paris; Director - Quinnehtuk, and Rocky River; approximately 1% of time to be devoted to NAESCO annually. Lawrence W. Shay - Director and Senior Vice President, Administrative Services - Charter Oak, CL&P, NUSCO, NNECO, WMECO, HWP, HP&E, Quinnehtuk, and Rocky River; approximately 5% of time to be devoted to NAESCO annually. Frank R. Locke - Director - CL&P, NNECO, WMECO, HWP, HP&E, Quinnehtuk, and Rocky River; Director, Senior Vice President r- and Chief Administrative Officer, New Hampshire - NUSCO; (_g) approximately 5% of time to be devoted to NAESCO annually. Edward R. Mroczka - Director and Senior Vice President, Nuclear Engineering and Operations - CL&P, NUSCO, NNECO, WMECO, HWP, and HP&E; Director - Quinnehtuk, and Rocky River; approximately 20% of time to be devoted to NAESCO annually. l Ted C. Feigenbaum - No position currently with any NU system I company; 100% of time to be devoted to NAESCO. Walter F. Torrance, Jr. - Senior Vice President, Secretary and Genaral Counsel - NU; Director, Senior Vice President, Secretary and General Counsel - Charter Oak, Paris, CL&P, NUSCO, NNECO, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; Director, Senior Vice President, Secretary, General Counsel and Assistant Clerk - HWP, HP&E, WMECO, and Quinnehtuk; approximately 5% of time to be devoted to NAESCO annually. The following is a list of the prospective officers of NAESCO,
-their connections with associate companies of NAESCO, and the s
approximate percentages of their total working time that I b_l s- initially will be devoted to NAESCO on an annual basis. The
l (:) exact title of each officer has not yet been determined. With the exception of Mr. Feigenbaum, none of these officers will receive any compensation directly from HAESCO. William B. Ellis - See list of directors Bernard M. Fox - See list of directors John F. Opeka - See list of directors Robert E. Busch See list of directors John P. Cagnetta - See list of directors Edward J. Mroczka - See list of directors Lawrence W. Shay - See list of directors Walter F. Torrance, Jr. - See list of directors Ted C. Feigenbaum - See list of directors C. Thayer Browne - Vice President and Treasurer - NU, Charter Oak, Paris, CL&P, NUSCO, NNECO, WMECO, HWP, HP&E, Quinnehtuk, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; approximately 5% of time to be devoted to NAESCO annually. Tod O. Dixon - Vice President, Information Resources - CL&P, NNECO, NUSCO, WMECO, HWP, and HP&E; approximately 5% of time to be devoted to NAESCO annually. Albert J. Hajek - Vice President, Corporate Performance Services and Organizational Control - CL&P, NNECO, NUSCO, WMECO, NWP, and HP&E; approximately 5% of time to be devoted to NAESCO annually. Barry Ilberman - Vice President, Human Resources - CL&P, NUSCO, NNECO, WMECO, HWP, and HP&E; approximately 5% of time to be devoted to NAESCO annually. Francis L. Kinney - Vice President, Public Affairs - CL&P, NNECO, NUSCO, WMECO, HWP, HP&E, Quinnehtuk, and Rocky River; approximately 5% of time to be devoted to NAESCO annually. i 1
O i ,/ l Keith R. Marvin - Vice President, Purchasing and Materials Management - CL&P, NNECO, NUSCO, WMUCO, HWP, HP&E, Quinnehtuk, and Rocky River; approximately 10% of time to be devoted to NAESCO annually. Wayne D. Romberg - Vice President, Nuclear Operations - CL&P, NNECO, NUSCO, and WMECO; approximately 20% of time to be I devoted to NAESCO annually. George D. Uh1 - Vice President and Controller - NU, CL&P, NNECO, NUSCO, WMECO, HWP, HP&E, Quinnehtuk, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; approximately 10% of time to be devoted to NAESCO annually. Eric A. DeBarba - Vice President, Generation, Engineering & Construction - CL&P, NUSCO, NNECO, WMECO, HWP, and HP&E; approximately 20% of time to be devoted to NAESCO annually. C. Frederick Sears - Vice President, Nuclear and Environmental Engineering - CL&P, NUSCO, NNECO, WMECO, HWP, and HP&E; approximately 20% of time to be devoted to NAESCO annually, f](_/ Theresa H. Allsop - Assistant Secretary - NU, CL&P, NNECO, NUSCO, Charter Oak, Paris, and Rocky River; Assistant Clerk - WMECO, HWP, HP&E, and Quinnehtuk; Director and Assistant i Secretary - C&SE&G, Steam, Transmission, EPI, and Nutmeg;
- approximately 5% of time to be devoted to NAESCO annually.
Karen G. Valenti - Assistant Secretary - NU, CL&P, NUSCO, NNECO, Charter Oak, Paris, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; Assistant Clerk - WMECO, HWP, HP&E, and Quinnehtuk; approximately 5% of time to be E devoted to NAESCO annually. Robert C. Aronson-- Assistant Treasurer - NU, CL&P, NNECO, NUSCO, WMECO, Charter Oak, Paris, HWP, HP&E, Quinnehtuk, Rocky l River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; l approximately 1% of time to be devoted.to'NAESCO annually. Arthur H. Hierl - Assistant Treasurer - NU, CL&P, NUSCO, NNECO, WMECO, Charter Oak, Paris, HWP, HP&E, Quinnehtuk, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; approxhaately -l% of time to be devoted to NAESCO annually, f Eugene G. Vertefeuille - Assistant Treasurer - NU, CL&P, NUSCO, NNECO, WMECO, Charter Oak, Paris, HP&E, HWP, Quinnehtuk, Rocky River, C&SE&G, Steam, Transmission, EPI, and Nutmeg; fg ( j approximately 5% of time to be devoted to NAESCO annually, i
( Pierre O. Caron - No position currently with any NU system company; approximately 5% of time to be devoted to NAESCO annually. The compensation received by NAESCO's most senior officers and directors is included in NU's 1990 proxy statement, filed herewith as Exhibit I. During 1989 and 1990, Ted C. Feigenbaum received no compensation from any NU system company. In addition, NAESCO's permanent employees initially will be the same as those employed by NHY immediately prior to the transfer of operating responsibility. (See paragraph 15 for a description of the transition from NHY to NAESCO.) The salaries of these () employees will be included in NAESCO's annual operating budget. A proposed operating budget for NAESCO's first fiscal year is filed herewith as Exhibit J. The current organization of NHY is shown in Exhibit M. 1 I AGREEMENTS WITH THE JOINT OWNERS l l L 15. NAESCO's obligations to the Joint Owners will be governed principally by three agreements -- the MAOA, the DAA.and The MAOA will I the JOA.(Exhibits B.1, B.2 and u.3, respectively). define NAESCO's duties with regr cd to the management, operation and maintenance of Seabrook and will be the most important of the three for the purposes of this Application. The principal terms O of the MAOA were set forth in a July 19, 1990 agreement (the (m)
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" July 19, 1990 Agreement") between NUSCO, acting on behalf of NAESCO, and New England Power Company, CL&P, PSNH, The United Illuminating Company and Canal Electric Company (f11ed herewith as Exhibit B.6). Under the MAOA, NAESCO will assume from NHY the responsibilities for managing, operating and maintaining Seabrook and for supervising the disposition of Seabrook Unit No.
2 at the " Time of Effectiveness," which is defined as 11:59 p.m. of the last day of the calendar month in which all federal, state x d local regulatory approvals necessary for the transfer of t'ose responsibilities have been acquired. The Applicants contemplate that this transition will be initially accomplished r by transferring to NAESCO as of the Time of Effectivenoso the b] existing staff of NHY and all existing authority to administer contracts with respect to Seabrook. This will achieve continuity in the management of Seabrook by allowing NAESCO to initially assume the role of operator of Seabrook with the same staff and contractor support resources that the NRC has previously evaluated and approved in connection with the technical qualifications of PSNH, including the engineering and technical resources supplied under the YAEC service contract. Thus, Seabrook will be assured of the continuing availability of technical expertise for its operation. NAESCO, in the exercise of its management res?onsibility and discretion, will'thereafter have the flexibility of determining how those existing resources can best be integrated with the other resources available to O)
a ': NAESCO,-including those from the NU system, in order to carry out
'its responsibilities. .-The Joint Owners have passed-a resolution
-[ directing NAESCO not to make significant staffing' changes in the operating and on-site technical support organizations at Seabrook between the Time of Effectiveness and the_ completion of-
.the first refueling, without the approval of the Joint Owners.
- 16. The July 19, 1990 Agreement has been signed by-Joint' Owners with an' aggregate ownership interest in Seabrook of
-70.60921. percent, which is large enough to appoint NAESCO as the ;
LManagingl Agent of the plant pursuant to Section 36 of the present'
.JOA_and as the.Diebursing Agent pursuant to Section 35 of the l JOA. The July 19, 1990 Agreement grants NAESCO the authority to ;
manage,' operate.'and_ maintain Seabrook once all of the requisite b : regulatory approvals have been obtained, even if NU's ; a -acquisition of-PSNH has not yet been consummated.- That agreement. L .also sets forth the principal provisions of the MAOA and the
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. amendment to the-DAA and certain modifications to the JOA which L the signatories to the July. 19, 1990 Agreement have agreed upon. 3 While the Joint-Owners must still enter'into the MAOA'and amend a the DAA.and may modify the present JOA to reflect the terms of the_ July: 19, 1990: Agreement,-NAESCO's assumption _of its responsibilities related to--Seabrook-has already been-authorized-pursuant _to the July 19,-1990-Agreement and may occur prior to \
Nevertheless, it is-i
, Q the formal-execution of those agreements.
.V. .
O expected that the MAOA and the DAA will be executed prior to the Time of Effectiveness. The execution of a document modifying the JOA, which will require the approval of Joint owners with an y aggregate ownership interest of 80%, is not a condition precedent to the execution of the MAOA and the DAA or the assumption by NAESCO of its responsibilities for the management, operation and maintenance of Seabrook. If NAESCO assumes those responsibilities prior to the formal execution of the MAOA and the DAA, its performance will be governed by the July 19, 1990 Agreement until those agreements are executed.
- 17. The MAOA will give to NAESCO responsibility for the f}
(_/ day-to-day management, operation and maintenance of Seabrook. Specifically, NAESCO's duties will include, inter allat (1) managing, operating and maintaining Seabrook; (ii) selecting, employing, training and maintaining sufficient personnel to staff Seabrook in accordance with NRC license and regulatory requirements, and providing or causing to be provided any support services for such operations; (iii) planning for nuclear fuel utilization at Seabrook and procuring on behalf of.the Joint Owners the requisite nuclear fuel, including-arranging for all stages of u'ranium processing, fuel design and fabrication and eventual storage, transportation, disposition and/or reprocessing of irradiated nuclear fuel and the disposition of or use of reprocessed material; s s
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l (iv)z purchasing and maintaining on_ behalf of the Joint Owners inventoriesTof materials, supplies and spare parts required for the
. operation and maintenance of Seabrook;. ]
(v) after consulthtion with the' executive ~ committee of the Joint Owners (the." Executive ! Committee") (see paragraph 22)-toLthe extent J' required by the July 19, 1990 Agreement, selecting and retaining consultants and contractors to assist in the performance of NAESCO's_ responsibilities; (vi) recommending to the Joint Owners specific . actions concerning:the= disposition of
- Seabrook-Unit No. 2; L(vii) reporting'to the_ Executive Committee on the 1 operation and finances of, and_ insurance for, !
Seabrook; and-(viii) taking^alliother actions necessary_to keep the necessary' regulatory permits in full 4 O' . force and!effect. i ( e
- 18. The provisions of-the-July _ 19, 1990 Agreement give q
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'NAESCO the authority'to appoint:or retain a service-company or q agent' affiliated with NAESCO to perform certain of'its responsibiltities under the MAOA and the JOA. :Any agreement with -7
-.such service _ company or---agent _ must lur approved l by at least three a
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' Joint Owners, unaffiliated with each other,1with anl aggregate 3
h Lownership_' interest inLSeabrook of'at_least 60l percent. -While
.NAESCO will. remain primarily: responsible-for.theimanagement, 7
L co peration'and maintenance of Seabrook,11t will enter into such' h 1 service ; agreements with- both NUSCOcand YAEC 'for: certain services. discussed in~ je-EeThelmaterialtermsofthoseproposedcontractsare 7[ paragraphs 23 to 25 of this Application. L
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- 19. NAESCO will adhere to Section 13 of the Act and the Commission's rules ~ promulgated thereunder with respect to the allocation of its costs to its customer companies. More specifically, the-MAOA will require the Joint. Owners, severally in accordance with their ownership shares and not jointly or jointly-and severally, to pay NAESCO, at cost, for all project >
. costs and expenses incurred by it pursuant to the JOA. The MAOA will call for each Joint Owner to pay the Disbursing Agent by the first of each month its ownership share of NAESCO's estimated costs under its operating and capital budgets for that month in accordance with the provisions of the DAA. Any differences between NAESCO's actual and estimated costs in a particular month will be reflected in billings by the Disbursing Agent to the
[ Joint Owners in subsequent months. Any amount billed to NAESCO f for services performed'by an affiliate pursuant to a service agreement authorized in accordance with the MAOA will be' billed q by the-Disbursing Agent to the Joint Owners at cost. .
- 20. NAESCO will also assume the' duties YAEC. currently performs as the Disbursing Agent for Seabrook, as set out in the nAA. These functions will include the preparation-of monthly bills to the Joint Owners as contemplated by paragraph 19.
NAESCO will establish-and maintain an escrow account or ac,ounts
= into which it will depoait the funds-it receives from the Joint
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...i,.~.,_ . . _m.- m
1 Owners in-payment of those bills. Subject to the approval of the Executive Committee, NAESCO's duties under the DAA will also include-the selection of investment managers to administer the funds it receives, the determination of investment guidelines relating to the administration of those funds, and the governing : or establishment of certain trust funds. Costs incurred under the DAA will be included in NAESCO's annual operating budget and billed in accordance with Paragraph 19. NAESCO's charges for its services under the DAA will be at cost, and any amount billed to NAESCO for services performed by an affiliate under the DAA will be billed to the' Joint Owners at cost. NAESCO will.lus required ; to keep' complete and accurate accounts of all receipts and
' expenditures in accordance with the -Commission's rules and the
~ Uniform System of Accounts prescribed by the Federal Energy:
Regulatory Commission. L 21. As noted above, the Disbursing Agent Agreement q i i presently in effect for the Seabrook Project _ designates.YAEC as L L the Disb'ursing Agent. _ Changes will be incorporated to_ reflect-the designation of NAESCO as Disbursing Agent =and to incorporate lcertain required provisions from the July 19, 1990 Agrcement. _ Such changes are reflected in the proposed First Amendment _to the Seventh Amendment to and Restated DAA which has been submitted herewith as part of Exhibit B.2. O
- . . - - . - ~ . - - - - ... . - - . - . . - . .- . . . - . - . . . . . - . . - _ . -
i 4 ~ I - 20-
-22. The'MAOA will be executed pursuant to Section 3G of the current JOA.- The JOA contains the provisions establishing the
. relationships among the-Joint Owners and the management of
- Seabrook. 'Various provisions of that agreement will be relevant-to NAESCO's role as:the managing-agent for that plant. Section 37 of the JOA calls for the formation of an Executive Committee with Lgeneral oversight responsibility. The July 19, 1990 1
Agreement contemplates that_the Executive Committee's role will include-certain_ additional responsibilities.with respect to the i direction and approval of NAESCO's actions upon execution of=an amendment to the JOA. O NUSCO' SERVICE CONTRACT
- 23. NAESCO will enter into a-service contract with NUSCO Lwhich is-similar.to the service contracts NUSCO-now has with the other.NU operating subsidiaries. .h copy:.of the proposed service _
9 l contract between NAESCO-and NUSCO is filed herewich'as Exhibit B.4. :WhileLNAESCO will remain primarily responsible for the management, operation and maintenance of Seabrook, NUSCO will-provide NAESCO, if-and to the extent requesteduby NAESCO, with
-certainJadministrative,-general 1and technical _ support-services i similar-to those which it provides:to the other nuclear plants operated by the NU system, which-include the three Millstone units in Waterford, Connecticut and the Connecticut Yankee unit i
I t
3
.V in Haddam Neck, Connecticut.- Because these services will be provided to a total of five nuclear plants, as well as other NU system companies,.NUSCO will be.able to take advantage of I
economies.of scale that NAESCO,.if it were to perform these functions alone, could not. Furthermore, because NU has more than 50 reactor years of experience operating four nuclear units, NAESCO will have access to a wealth of nuclear operating experience-and expertise currently residing in NU's subsidiaries. In each instance where a particular task or activity must be
' accomplished, NAESCO will decide whether to use internal NAESCO l resources, NUSCO resources or YAEC resources, as discussed in paragraph 25 below. This decision +111 be based upon the goal of ;
achieving cost e'ffectiveness without' sacrificing nuclear safety,' , quality or reliability. , 24.- NUSCO will'oill NAESCO at-cost for any services rendered-pursuant to the service contract between the two. companies. -Under.the July 19, 1990 Agreement, NUSCO costs that are incurred by NUSCO on behalf ofLNAESCO or for the sole !
-. benefit- of. NAESCO will lxa- billed directly to NAESCO. All other 3 NUSCO1 costs in which NAESCOtis to bear an-allocated share along_ ,
with the other NU system companies-will be allocated among NAESCO and the other NU' system companies fairly and equitably in accordance with Exhibit A to Exhibit B.4,-and the method of that allocation-must be approved by the Executive Committee. NUSCO () 1
- ,I
. 2 2.-
<}
will not be obligated to perform any services under this service contract if any cost allocation method approved by_the Executive Committee would require the NU system companies to bear a disproportionately large portion of those indirect costs. Any allocation method that is used will be consistent with the Commission's rules with respect to allocations of service companies' custs to affiliated companies. YAEC SERVICE CONTRACT
- 25. YAEC has been providing technical cupport services to
(~' the Seabrook project since its inception, and to NHY since NHY's s formation in 1984. Although NAESCO will remain primarily responsible for the management, operation and maintenance of Seabrook, NAESCO and YAEC will enter into a new-service contract under which YAEC will continue to perform for NAESCO engineering and technical functions of the type it now provides under its existing contract with NHY. A copy of the proposed YAEC service Because YAEC operates contract is filed herewith as Exhibit B.S. the Rowe nuclear plant in Rowe, Massachusetts and its Nuclear Services Division also provides engineering, licensing and technical services to Vermont Yankee, Maine Yankee and Seabrook, it, like NUSCO, will be-able to take advantage of additional economies of scale that NAESCO, operating only Seabrook, would
,q
.s_) not have available to it. In addition, Yankee has accumulated an 1
l l
I 4
'l experienced. staff which has over 650 man-years of direct Seabrook i experience and over 66 reactor years of operating and support
- experience. As with the NUSCO_ service contract, YAEC will bill NAESCO at cost for whatever services it provides. Under the July 19, 1990 Agr9ement, YAEC costs tn?.t-are incurred by YAEC on j
behalf of NAESCO or for the sole benefit of NAESCO will be billed direct 3y'to NAESCO. All other YAEC costs in which NAESCO is to bear an c.llocated share along with the,other companies to which YAEC provides services will be' allocated among NAESCO and-those other companies fairly and equiuably-in accordance with. Exhibit B l to-Exhibit B.,5,-and the method of that allocation must be 4 4 (~ . approved by the Executive Committee. -No other YAEC customer I company will beer a disproportionately large portion of-those indirect costs..-Any allocation method that is used will be Econsistent with the Commission's rules with respect to allocations'of service companies' costs to-affiliated companies. THE' TRANSACTION WILL MEET ALL OF THE REOUIREMENTS OF THE ACT Esctions 6(a)-and 7
- 26. Pursuant-to Section C(a) of the Act, the Applicants request the Commission to approve the issuance by NAESCO of y 000L shares of'NAESCO's authorized but unissued common stock, $1 par L ):
- m. s _ .,+ - e . - , . . . - , . ,
h-() - value, to NU.for $10 per share, or-$10,000 in the aggregate.
)
This" issuance will comply with the applicable provisions of j Because this common stock will be NAESCO's only J
=Section 7. )
l outstanding class of stock, it will be without_ preference as to : dividends cn: distribution of voting power. The fees,-commissions i and other remuneration to be paid in connection with this issuance will consist primarily of' legal fees, plus nominal costs for filing fees and stock certificates, and will represent a minor part of the overall cost of implementation of the Plan. ,
. Estimates of these. costs are included in Exhibit.G (to be. filed J by' amendment). _The only_ state-commission with jurisdiction over-this issuance is'the_New Hampshire Public, Utilities Commission
~
-("NHPUC")... The application to the NHPUC seeking approval of this .
t
. issuance willLbe' filed by amendment' as Exhibit D.3, and the NHPUC's order' approving.it will-be_ filed by amendment as Exhibit D.4. The issuance by-NAESCO of its common stock to NU will be
-exempt from the competitive bidding requirements of Rule.50 by virtue of Section (a)(3) of'that rule, which exempts the
" issuance -cn sale of securities to_any. registered holding company _
. . .-whose acquisition of such securities has been approved-by- >
the' Commission pursuant to Section-10-of:the Act.'" a O
- -- -,'-i = i
c Sections 9 and.lf
- 27. While most of the prospective directors and officers of NAESCO hold similar positions with other NU system companies, the interlocking relations are not detrimental to the public interest or the interests of investors or consumers under Section 10(b)(1) of the Act for several reasons. First, these people were chosen for their competence, not to create interlocking management in the NU system. Second, HAESCO will be a first ti'ar subsidiary, 4 subject to regulation under New Hampshire law r..id regulation by
- the NHPUC, and the relationship between FAESCO arJ the rest of I
g,. the NU system will be the same as the earrent relationships among NU's operating subsidiaries. Thus, tra interlocking l relationships will be only those necessary to integrate NAESCO into the NU syttem. Third, this transaction merely involves the a spinning offa to NAESCO, an NU cubsidiary, of a function which otherwise would be performed by a division of PSNH, which under the Plan will also becomo a wholly owned subsidiary of NU. Any interlocking relations resulting from this transaction do not change materially the situation as it would exist if NAESCO were not formed. Fourth, in accordance with the Commission's holding in Eb3Epo Sorvices, Inc., H.C.A. Rolesso No. 2255, these , directors and officers will not rece.'Ne salaries from both NU and NAESCO, and therefore, this arrangement will not defeat the ('h purpose of Section 13 by having directors and of ficers paid by La) 5
n both the regietered holding company and a service company Oubsidiary. In fact, any amount paid for their services will be paid under a cost allocation methodology approved by the Executive Committee. Finally, because of the benefits described herein which will accrue to the public and to consumers and investors as a result of NAESCO's management, operation and maintenance, the interlocking relationships will na be of a kind or to an extent detrimental to the public interest or the interest of investors or consumers. CL, Eastern Utilities Agnociates, H.C.A. Release No. 25049 (March 2, 1990).
- 28. The trans. t in will not unduly complicate NU's capital k structure. "The Commiselon has recognized that the creation of a direct cubsidiary of a public utility holding company does not unduly or unnecesearily complicate the system's capital structure in violation of (S)ection 10(b)(3)." Entergy Corp., H.C.A.
Release No. 25100 (June 5, 1990). Eee also Entercy Corp 2, H.C.A. Releaso No. 25136 (August 27, 1990).
- 29. The creation of a new NU subsidiary to manage, operate l
' and maintain Seabrook is necessary and appropriate, and it in not an undue complication of the NU system. As explained in l paragraph 6, because NAESCO will be a "public utility" under New
' Hampshire law, it must be organized as a New Hampshire entity.
Since none of the current NU subsidiarios are organized under New O G l \
__ - _ - - - -. _ __ m _ . - - . _ I v Hampshire law, they may not assume the responsibility for managing, operating and maintainin{ Joabrook. Furthermore, since PSNH would no longer own an interest in Seabrook after NU's acquisition of PSNH is consummated, it therefore would make littic sense for it to continue to operate the plant. NAEC is merely a financing vehicle, and requiring that company to take on the responsibility for managing, operating and maintaining Seabrook Unit No. 1 and supervising the disposition of Seabrook Unit No. 2 would complicate its situation and could adversely impact its ability to acquire financing on the most favorable terms possible. Finally, as evidenced by their application in File No. 70-7214 (see footnote 1, gunta), the Joint Owners have ()forsometimeintendedtohaveSeabrookoperatedbyaseparate company, like NAESCO, the only business of which is the operation of that plant. In fact, this approach mirrors NU's own past practice of having a separate subsidiary operate its nuclear plants. Thus, in light of the various options available, the creation of NAESCO to manage, operate and maintain Seabrook is the best alternative and is not an undue complication of the NU system. l
- 30. In accordance with Section 10(c)(1), the proposed transaction will not be unlawful under Sectior. B because NU no longer has any interest in a gae utility company, having divested
_s itself'last year of the gas utility business previously operated ; i %J ' l l l l
H by CL&P. SAA H.C.A. Release No. 24908 (June 22, 1989). NAESCO will-have no direct or indirect interest in a gas utility
-business. Nor will the proposed transaction be detrimental to carrying out the provisions of Section 11 of the Act. The addition of NAESCO simply adds to the integrated NU system another electric utility company and service company to operate Seabrook, of which that system, after NU's acquisition of PSNH, will own 40 percent. The formation of NAESCO therefore is a logical and functionally related addition to the system.
i
- 31. In compliance with Section 10(c)(2) cf the Act, the addition of NAESCO to the NU system *will serve the public interest by tending towards the' economical and efficient (x ] ;
development of an integrated public utility system." As discussed above, the NU system will continue to be an integrated public. utility system after NAESCO is formed, and the transaction
'has the potential?for, and is expected to result _in, significant economies for the NU r,ystem and benefits for'the public for the following reasons 4
- 32. First, the formation of NAESCO is a part of NU's: Plan to-acquire and reorganize the bankrupt PSNH. The economies and efficiencies which will result from the-implementation.of NU's Plan are discussed at length in paragraphs 42 through-49 of NU's applicatioh/ declaration in File No. 70-7695 which are hereby
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O l incorporated herein by reference, and they were accepted by the
-Commission in its Opinion and Order in that file. Of the total !
i savings expected to be accomplished by the Plan, by far the j largest component of those savings is expected to result from j NAESCO's operation of Seabrook. The NU system has more than 50 , reactor years of experience operating four nuclear units, and it i is recognised throughout the nuclear industry for its safe and efficient operation of those plants. The Applicants contemplate that through NACSCO, the NU system will be able'to bring to the i operation of Seabrook;both its-experience and the economies of i scale which will be created by adding Seabrook to its multi-unit nuclear organization, thus achieving the projected savings. ,
,O These' savings are discussed in detail in paragraph 46 of HU's l application / declaration in File No. 70-7695. I I
=33. .rurthermore, the savings accomplished by NAESCO's ,
operation-of.Seabrook will be enjoyed by-all of the New England
])
utilities with an ownership interest; in, or power contract for power generated by, Seabrook in the same proportion as their , i ownership. interest.or entitlement in the plant. Therefore,. i substantial savings will accrue to New England electric utility I 1 companies other.than NU and PSNH. e
- 34. . Finally,.NAESCO's management, operation and maintenance i
of Seabrook means that: NU, .one of the more experienced and-1 l l L
capable nuclear operators in the country, will bring its ability and experience to that plant. Among the benefits expected to be achieved through this arrangement are access by NAESCO to the wealth of nuclear operating experience and expertise currently existing in NU's nuclear operating subsidiaries, the development of specialization in the NU system in areas where it might not otherwise occur, the opportunity for NAESCO to benefit from the specific " lessons learned" by NU, the transfer of certain non-nuclear support functions (administrative and general) from NAESCO to NU's specialty groups allowing NAESCO to focus more effectively on the requirements of nuclear operations, and an enhanced ability to attract highly qualified employees for
) (/ '~ Seabrook because of the greater opportunities for career advancement throughout the larger NU system.
- 35. Once the Applicants have received the NHPUC's approval of NAESCO's issuance of common stock to NU as discussed in Item IV of this Application, all state laws with respect to the formation of NAESCO shall have been complied with, thus satisfying Section 10(f) of the Act. Therefore, because this transaction complies with this and all of the other relevant subsections of Section 10, the Commission should approve NU's acquisition of NAESCO's common stock.
O \ \ >s l l
, ..._. _ __ _.._ _. _ . _ __ _ ~_ _
[ l Section 13 5
- 36. Section 13(b) of the Act prohibits a subsidiary of a registered public utility holding company from performing F
services for associate companies except in accordance with rules ; 1 and regulations or orders of the commission. Section 13(f) of the Act prohibits a service company subsidiary of a registered
-holding company from performing services to any public utility in contravention of the rules and regulations or orders of the Commission regurding areports, accounts, costs, maintenance >f l competitive conditions, disclosure of interest, duration of contracts and similar matters." In managing, operating and mairitaining Seabrook, NAESCO will be performing services both for associate companies (CL&P and, eventually, NAEC) and'for other
-public utilities (the other Joint Owners), and NUSCO and YAEC, in i entering into the contemplated arrangements with NAESCO and the Joint' Owners, will be performing services for associate companies and non-associate companies. As the following paragraphs-demonstrate, these service _ arrangements will comply with all'of h the pertinent rules and regulations of the Commission.
1 i
- 37. Rule 86 prohibits a registered holding company subsidiary from performing services for associate companies-without Commission. approval, and Rule 87 lists the classes of Among the
(()[companyforwhich-thatapprovalmaybegranted.
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I classes listed in Rule 87 is "a subsidiary company whose organization and conduct of business the Commission has found, pursuant to (Rule 88), sufficient to meet the requirements of Section 13(b) of the Act." Under Rule BB(b), the Commission may approve the formation of a subsidiary service company under Section 13(b) if it finds, pursuant to a declaration of the company, that it will provide the services to the associates efficiently and economically with costs allocated fairly and equitably among them. As discussed herein, NAESCO will perform the managerial, operational and maintenance services for Seabrook efficiently and economically, producing savings for NAEC, CL&P and the other Joint Owners. Because the only work NAESCO will (( ) engage in will be related to Seabrook, all of its costs will be allocated to the Joint Owners to be paid in the manner described in paragraphs 19 and 20. Therefore, the formation of NAESCO complies with Rule 88, meaning it also complies with Rules 86 and 87.
- 38. The performance of services for NAESCO by NUSCO and YAEC also will comply with Rules 86 and 87. Consistent with Rule 87(a)(2), NUSCO's organization and conduct of business has been approved by the Commission, agg Northeast Utilities Service company, H.C.A. Release No. 15519 (June 30, 1966), and consistent with Rule 87(a)(3), YAEC is "a subsidiary company which is
() principally engaged in the business of an operating electric l
m _ _ _ __ _ .___..__._. __ _ _ . _ . _ . ____ _ __. i = i
- I
- l
- 1 'i . 1
- . . . utility compar.y* and the services it will provide to NAESCO 1 will be performed incidentally to its generating business. In i
addition, the organization and conduct of business of the ! Nuclear Services Division of YAEC, which will provide the i services contemplated by the YAEC service contract, has been ' approved by the Commission. 122 Yankee Atomic Electric co., H.C.A. Release No. 16141 (August 20, 1968). Accordingly, the 4 contemplated service arrangements with both NUSCO and YAEC , comply with Rule 87, and should be authorized under Rule 86. L
- 39. In compliance with Rule 89, the MAOA, the DAA and the i
()NUSCOandYAECservicecontractsstatethatthoseagreements shall be terminated if and to the extent that they do not comply l ! with the Act. In compliance with Rule 90, as described in , paragraphs 19, 20, 25, and 26, NAESCO, NUSCO and YAEC will perform'the services set out in the MAOA, the_DAA_and_the NUSCO 1 and YAEC service contracts at cost as determined in accordance with Rule 91. NAESCO will keep its accounts, cost accounting procedure, correspondence, memoranda, papers, books and other records in the manner prescribed by Rule 93 and preserve them for the appropriate time periods under that rule. Finally, NAESCO-l will file the appropriate reports at the appropriate times under Rules 94 and-95. ' ~ O 1 '- __ - - _ . . . _ . . . - ~ . _ . - _ _ _ _ _ __ _-._. _ _ _._ ~ - _ _ _ __ _ __-- _ , ._.~. _ _ - _ . . _ . _ _
_ . _ _ _ . _ . . . _ . - _._ . _ . _ _ _ ..__m_._ ->,.m.__,~,._ . J 4 40. In accordance with Rule 91, the costs to be charged by ) NAESCO to the Joint Owners under the EAOA and the DAA and the costs to be charged by NUSCO and YAEC to NAESCO under the NUSCO and YAEC service contracts shall include a reasonable return on capital-for the shareholders of each of those companies. The
. return on capital component for each of those contracts shall be determinedLin accordance with their respective provisions, ,
1 including Exhibits A to the MAOA and the NUSCO service contract and Exhibit B to the YAEC contract.
- 41. Section 13(f) of the Act prohibits a service company
- r().romusingthemailsoranymeansorinstrumentalityof interstate commerce f to enter into or take any step in the !
performance of any service, sales or construction contract with any public-utility company engaged in interstate commerce,.or i vita any registered holding company or any subsidiary of a registered holding company, t in contravention of such rules:and I regulations or orders regarding reports, accounts, costs, maintenance of competitive
; conditions, disclosure of interest,. duration of contracts, and similar matters as the Commission deems necessary or appropriate in the public interest or for the. protection of investers or consumers. . . .
4 This section-of the Act' applies to NAESCO's, NUSCO's and YAEC's relationships with the Joint Owners who are not their affiliates as well as to.their relationships with their associate companies.
---, ,J. ._
~35-([)
While the Commission has not promulgated any rules under this Section applying specifically to service arrangements with non-affiliates, each company will perform its duties with respect to , its non-affiliates in the identical manner that it will perform l those duties with respect to its affiliates, in compliance with l the applicable rules the Commission has promulgated. This ensures that any concerns the Commission might have regarding j each company's relationships with its non-af filiates are handled l under the rules promulgated for services to affiliates. Accordingly, the Applicants have complied or will comply with every applicable rule, regulation and order of the Commission, (~S and NAESCO's organization and conduct of business and the MA0A, U DAA and the NUSCO and YAEC service contracts should be approved under the appropriate provisions _of Sections 13(b) and 13(f) of the Act.
- 42. In several material respects, the transactions for which the Applicants seek Commission approval with this Application are similar to those transactions recently approved by the commission in Enterav Corpm, H.C.A. Release No. 25100 (June 5, 1990). In that matter, Entergy Corporation, a registered public utility holding company, and its electric utility, generating and fuel supply subsidiaries sought to form a new company, called Entergy Services, Inc., to manage, operate and maintain the nuclear unita in which the Entergy system
()
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, , . , , - . , - - . . -_.nn.-.-
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- f. 1 J
l companies held interests. The transaction was expected to bring 1 about several economies of scale, much as this transaction is. In fact, the primary difference between the Enteray case and this s matter is that the security issuances and intra-system contractual arrangements in Entergy were more complex than those l proposed for NAESCO. In its decision in Entergy, the Commission held that "the proposed transactions are consistent with the standards of the Act and our rules, that no adverse findings are 4 necessary and that no hearing is required to develop the facts further." Id. See also General Public utilities _Corgt, H.C.A. Release No. 21700 (Sept. 5, 1980) (organization of subsidiary service company to operate nuclear units approved); Yankee Atomic
}
Electric Co., H.C.A. Release No. 16141 (August 20, 1968) ] (formation of division of operating electric utility to provide nuclear services to other utilities approvsd).
- 43. On the basis of these precedents and the description et this transaction contained in this Application, the Commission is requested to approve the organization and conduct of business of NAESCO as a wholly owned service company and electric utility subsidiary of NU and to issue all of the ancillary approvals necessary to implement that organization and conduct of business.
As explained herein, the assumption by NAESCO of NHY's duties with regard to the management, operation and maintenance of ()'Seabrookwillproducesignificantsavingsforallthoseinvolved
l in the Seabrook project and will comply with each of the relevant sections Of the Act. NAESCO's management, operation and maintenance of Seabrook is supported by Joint Owners with more than 70 percent of the ownership interest in Seabrook, as demonstrated by the July 19, 1990 Agreement. Accordingly, the Commission should approve NAESCO's organization. ITEM II FEES. COMMISSION, AND EXPENSES
- 44. The estimated emounts of fees, commissions and expenses paid or incurred, or to be paid or incurred, directly or
} indirectly, by the Applicants with respect to the organization of NAESCO are set forth in Exhibit G (to be filed by amendment).
- 45. None of such fees, commissions or expenses will be paid to any associate company or affiliate of the Applicants except for financial and other services to be performed at cost by NUSCO, an affiliated service company, and YAEC, an affiliated electric utility company, and except that C. Duane Blinn, a member of the firm of Day, Berry & Howard, counsel to NU, NUSCO and HAESCO, is Assistant Secretary of Connecticut Yankee Atomic Power Company, an affiliate, and the estimate of legal fees will include payment to be made to that firm for legal services in connection with the transactions proposed in this Application.
() .
l O ITEM III APPLICABLE STATUTORY PROVISIONS
- 46. The following sections of the Act, and Rules promulgated by the Commission pursuant to the Act, are or may be applicable to the transactions described herein:
Sections of Transaction to which Sections the Act Are or May Be Acolicable 6 and 7 NAESCO's issuance of common stock to NU 9 and 10 NU's acquisition of NAESCO's common stock 13(b) Organization of NAESCO as a subsidiary service company Provision of services by NAESCO to CL&P and, eventually, NAEC Provision of services by NUSCO to NAESCO Provision of services by YAEC to NAESCO Provision of services by NAESCO, NUSCO, I3(f) and YAEC to certain Joint Owners Rules Issued by SEC pursuant Transaction to which Rules to the Act Are or May Be Applicable 43 Issuance by NAESCO of common stock to NU 50 Exemption of NAESCO's issuance of common stock to NU from the Rule 50 competitive bid requirements under Rule 50(a)(3) 86, 87 Provision of services by NAESCO to Joint Owners and by NUSCO and YAEC to Oi NAESCO
4; g .1 f t 88 Organization of NAESCO 89 Termination-provisions:of MAOA and DAA and NUSCO and YAEC service contracts 90,.91, 92 Cost allocation under MAOA and DAA and ! NUSCO and YAEC service contracts 93 Accounting methods to be used by NAESCO 94, 95 Filing of reports'by NAESCO li i ITEH IV REGULATORY APPROVALS 3 l
- 47. NRC approval is required to amend'the NRC operating ;
)licenseforSeabrooktoinclude-NAESCOasaLlicenseeunderthat-license and to authorize NAESCO,fas agent for the Joint Owr.ers,
.to, menage,soperate and maintain Seabrook. On November 14,'1990,
-PSNH,'onLbehalf ofLthe JointLOwners, filed an application with the NRC for these approvals, a copy of which is filed herowith as i
-Exhibit D.1. A1 copy of the NRC_ order approving-the: license amendments will be filed by amendment as Exhibit D.2.when it i .
D 'becomes available.
- 48. As' explained in paragraph 8, for NAESCO to operate Seabrook, New Hampshire law requires it to be.fermed as a New
; Hampshire business entity. The NHPUC has already approved the formation of NAESCO as a public utility (San Exhibit.L at 171-
\ I 72). .As a.New Hampshire public utility, NAESCO must receive the
. 's
. _ ~ . . _ . _ . _ _ _ _ . _ . _ . _ _ _. _ .,, m .._ ,.; _ . - _ __ _ . _ _ . >
( l l authorization of the NHPUC under Section 369:1 of the New Hampshire Revised Statutes to issue its common stock to NU While the NHPUC has not yet addressed this security issuance specifically, in a July 20, 1990 decision authorizing many of the transactions related to NU's acquisition of PSNH (Sidt Exhibit L), the NHPUC held that the overall financing plan outlined for that acquisition, of which NAESCO's issuance of common stock to NU is a part, is " conceptually consistent with the public good.* Era Exhibit L at 188. In addition to NAESCO's issuance of its common stock to NU, NHPUC approval will also be requested under Sections 366:3 to 366:5 of the New Hampshire Revised Statutes for certain of NAESCO's contracts with its affiliates. Copies of the application to the NHPUC seeking all of the necessary approvals and the NHPUC's order granting such approvals will be filed by amendment as Exhibits D.3 and D.4, respectively. ITEM V PROCEDURE
- 49. Although NAESCO will operate and maintain Seabrook as an integral part of NU's acquisition of PSNH, under the July 19, 1990 Agreement NAESCO may assume responsibility for operation and maintenance once it has received the necessary regulatory approvals, even if that occurs prior to the consummation of that acquisition, in order to achieve as promptly as possible the l
1 i J l O ; g 1 i I substantial savings outlined herein. Accordingly the Commission l 1s requested to issue its order granting the requested approvals as promptly as practicable and in any event by March 15, 1991. l l The Commission is further requested to issue that order even if the NRC has not yet taken action. i. i ) 50. Except for such issues as may be set down for hearing, i the Applicants hereby waive a recommended decision by a hearing i officer or other responsible officer of the Commission and consent that the Office of Public Utility Regulation within the i Division of Investment Management may assist in the preparation i () of the Commission's decision and/or order and hereby request that the Commission's order become effective forthwith upon issuance. ITEM VI EXHIBITS AND PINANCIAL STATEMENT (a) EXHIBITS Asterisked (*) items are to be filed by subsequent amendment.
*A.1 Certificate of Incorporation of NAESCO
*A.2 Bylaws of NAESCO B.1 Form of Managli.7 Agent Operating Agreement B.2 Seventh Amendment to and Restated Agreement for (V
) Seabrook Project Disbursing Agent and First Amendment thereto v - .._w, .,
b 1 i 1 B.3 Construction and Agreement for Joint Ownership, lear Units, as amended Operation of New Hampshire Nuc B.4- Form of service contract between NUSCO and NAESCO i B.5 Form of YAEC service contract B.6 July .9, 1990 Agreement among NUSCO, New England Power Co., CL&P, PSNH, The United Illuminating Co. and Canal 1 Electric-Co. D.1 NRC Application I
*D.2 NRCLOrder
*D.3 NHPUC Applicetion
*D.4 NHPUC' Order i
*F Opinion of Counsel
- *G Statement of fees, commissions and expenses l L _() -H Statement of gross operating revenue for CL&P I 1990 NU Proxy Statement
.JL -Proposed NAESCO-operating budget for first fiscal year X Form of Proposed Notice -!
20, 1990) 1 L 'NHPUC filed asDecision Exhibit in Docketthe No.application 89-244L(July / declaration in-L D.10-to L File No. 70-7695 and-incorporated herein by reference. [ M Organizational structure of NHY 1 (b) FINANCIAL STATEMENTS 'i 1.- Northeast Utilities (parent company'only)
*1.1. Balance Sheet, per books and pro forma, an.of ,
September 30, 1990 . 41.2 Statement ofl Income per' books and pro forma for che twelve months ended September-30, 1990 l
. , - . . , - . . . . _ , - . - . . ~ . _ . . . , _ . . . . . . . . . , _ - , _ . . _ , . _ . . - . _ . . . . . _ . _
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~43-1
- 2. Northeast Utilities and Subsidiaries and PSNH (consolidated)
*2.1 Balance Sheet, per books and pro forma, as of September 30, 1990
*2.2 Statement of Income and Statement of Retained Earnings for the twelve months ended September 30, 1990
- 3. Yankee Atomic Electric Compeny 3.1 Balance Sheet, per books as of September 30, 1990.
(Because Yankee will provide to NAESCO, at cost, the same services it currently provides to NHY at cost, this transaction will have no material effect on its balance sheet or income, and, accordingly, no pro forma balance sheet, statement of income or statement of retained earnings is being filed herewith.) 3.2 Statement of Income and Statement of. Retained Earnings for the twelve months ended September 30, 1990. g3 +4. North Atlantic Energy Service Company (Because NAESCO is a newly-organized company, no () Statement of Income and Statement of Retained Earnings has been preparod.) ITEM VII INFORMATION AS TO ENVIRONMENTAL EFFECTS (a) The steps required for the implementation of the transactions described herein involve the issuance of securities and the execution of contracts related co already existing facilities. As such, the issuance of an order by the Commission with respect to this Application is not a major federal action An significantly affecting the quality of the human environment. environmental impact statement was prepared for Seabrook by the This transaction will not change NRC in its Docket No. 50-443. the assessment in that statement. , . s-[]- (b) No.-
j a SIGNATURES l
- i l
Pursuant to-the requirements of the Public Utility Holding
-1 Company Act of-1935, the undersigned applicants have each duly !
caused this Application to be signed on its behalf by the - t undersigned officers hereunto duly authorized. , 2 Dated: January 11,.1991 Northeast Utilities Northeast-Utilities Service Company -
-i North Atlantic. Energy Servico Company by Northeast Utilittes Service Company, t Their Agent ,
O By s/ John F. Oceka John F. Opeka Executive Vice President Yankee Atomic Electric Company Traev, Jr. By. s/H. T. H. T. Tracy, Jr.: Vice President. 4 O
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i EXHIDIT B.1 1 I h ! *EABROOK PROJECT } l BANAGING AGENT OPERATING AGREEMENT l i ) i i i ) i Effectivo as of r 1991 L O
4 SEABROOM PROJECT r MAIJAGIl4G AGE!4T OPERATI!JG AGREEME!1T L]J TABLE OF CO!1 TENT.S Page
- 1. Definitions 5
; 2. Damic Understandings 6
- 3. Managing Agent 9
- 4. Services 12
- 5. Contracting Authority 15 a
- 6. Periodic Reporting 18
- 7. Access to Information 26
- 8. Payments; Budgets 31 Ba. Certain Transitional Rules 40
- 9. Insurance 41
()
- 10. Decommissioning 41
- 11. Limitation of Liability 42
- 12. Term and Effectiveness 44
- 13. No Setoff 46
- 14. Assignment 47
- 15. No Third Party Beneficiaries' 47
- 16. Several Obligations of Participants 47
- 17. Applicable Law and Enforceability 48
- 18. Arbitration 48
- 19. Notices 50
- 20. Counterparts 50
- 21. Amendment 51 l Signatures 52 l
i
1 e b, . SEABROOK PROJECT MANAGING AGENT OPERATING AGREEMENT r ! This Managing Agent operating Agreement (* Agreement") is l- made as of , 1991, between North Atlantic Energy I Service Company, a corporation organized as a wholly-owned i subsidiary of Northeast Utilities (*NU") and a public utility ; , + l organized under the laws of the State of New Hampshire (the L L
- Operator"), and those signatories to the Joint Ownership j- Agreement (as defined in the next paragraph hereof) which have executed and delivered or which hereafter execute and deliver '
. .this Agreement (the
- Signatories"). The Signatories which are signatories of the Joint Ownership Agreement collectively with the other parties which are now or from time to time hereafter become signatories of the Joint Ownership Agreement are I hereinafter referred to as the " Participants". ;
i-WHEREAS, the Participants are the parties to the Agreement i i - - - - - for Joint Ownership, Construction and Operation of'New Hampshire Nuclear Units, dated May 1, 1973, as heretofore amended through i the Twenty-Third Amendment (which agreement as from time to time l amended is hereafter referred to as the " Joint Ownership ! Agreement"), which sets forth their respective rights and obligations with respect to the nuclear electric generating l plant ("Seabrook' Station"-or the " Unit" or the aPlant" or the L l
- project *) which the Participants have constructed in Seabrook, O
I O New Hampshire, consisting of unit one and all common facilities (*Seabrook 1") which is completed and unit two ("Seabrook 2") which has been cancelled; and WR2REAS, pursuant to the Joint Ownership Agreement and actions taken by the Participants, management responsibility for Seabrook Station, subject to the limited oversight and direction functions of the Executive Committee described in Paragraph 37 of the Joint Ownership Agreement (the " Executive Committee"), currently resides in Public Service Company of New Hampshire (*PSNH"), acting through its New Hampshire Yankee Division (the
" Division"); and O
V WHEREAS, pursuant to a plan of reorganization for PSNH filed by Northeast Utilities Service Company in bankruptcy case No. 88-0043 pending in the United States Bankruptcy Court for the District of New Hampshire with respect to PSNH, it is contemplated that PSNH will become a wholly-owned subsidiary of NU, and that PSNH's Ownership Share of Seabrook Station (the
'Seabrook Interest") will be transferred to a subsidiary of NU to be known as North Atlantic Energy Corporation ("NAEC"); and WHEREAS, Paragraph 36.2 of the Joint Ownership Agreement permits the appointment by Participants owning 51% or more of the Ownership Shares of Seabrook Station of a managing agent to O
1 l
. 3 ;
l l ! ($) act on behalf of all the Participants in the management of the -l l 1 operations of the Seabroox Station, and it is intended that this 1 l Agreement implement Paragraph 36.2 of the Joint Ownership Agreement; and WHEREAS, it is recognized that under the Joint Ownership Agreement the. Participants are each severally responsible for their respective Ownership Shares of the costs of operating and j
' maintaining Seabrook 1 and of the ultimate disposition of v
.Seabrook 2 and are entitled to their Ownership Shares of the capacity _and electric energy produced by Seabrook 1; and
~
WHEREAS, by order in File No. , the Securities and
=
Exchange Commission ("SEC") has-approved and authorized, under-the Puolic Utilities Holding Company Act of 1935 (the "Act"), the organization and conduct of business of Operator as a wholly owned subsidiary of NU, a public utility holding company I registered under the Act; and WHEREAS,JOperator desires.to assume the responsibilities of Managing Agent for Seabrook Station on behalf of the Participants and to perform such responsibilities and-duties all 3 in accordance with Prudent Utility Practice (as defined-in
-Paragraph 8.1;of the Joint Ownership-Agreement); and L
n _ w... . _ . , _ , _ . . . _ _ . - _ . . ~ . _ _ . . _ . _ _ _ , . - . . , _ . . . _ . . _ . _ . . . . . . . _ _ _ ~ _
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~4- l O WHEREAS, economies, increased efficiencies and other benefits will accrue to the Participants as a result of Operator's assumption of those responsibilities; and WHEREAS, it is the intent of the operator and the Signatories to promote the safe, efficient and reliable operation of Seabrook Station and the Signatories desire that the Operator shall have responsibility for the day-to-day operation and maintenance of Seabrook Station consistent with this goal; and WHEREAS, the operator and the Signatories, which hold in the aggregate ownership Shares totalling 70.60921% of all ownership Shares, wish to implement, as of the Time of Effectiveness (as hereinafter defined) the provisions of their Agreement made as of July 19, 1990 which can be implemented under the Joint ownership Agreement with the approval of less than 80% of the ownership Shares, and this Agreement is intended to accomplish that result; and WHEREAS, the Signatories and the Operator desire that all Participants shall have the unrestricted access to project information, with the limited restrictione set forth herein, and the Operator desires to keep the Participants regularly and fully advised of significant activities and developments.
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NOW, THEREFORE, in consideration of the promises and the mutual covenants contained herein, the parties hereby agree as follows:
- 1. Definitions (a) Terms defined in the Joint Ownership Agreement are used in t'ais Agreement with the same meanings as therein provided.
(b) The term "NRC" shall mean the United States Nuclear Regulatory Commission or any governmental agency or agencies which succeed to the powere thoroof. O (c) The term "NRC License" shall mean the full-power operating license, No. NPF-86, as amended from time to time, and all other licenses relating to Seabrook Station issued by the NRC. (d) The term "NRC Amendment" shall mean the amendment to NRC License, which, inter alla, designates Operator as the entity technically qualified to operate Seabrook 1. (e) The term " Time of Effectiveness" shall mean 11:59 p.m. on the last day of the calendar month in which the NRC Amendment, and any other federal, state or local
O regulatory, judicial or other approvals necessary for i the performance of this Agreement (collectively
" Regulatory Approvals"), shall all have become i~
effective. (f) The term " Unaffiliated Participants" shall mean those Participants which are not under common control.
- 2. Basic Understandings (a) (i) This Agreement relates to the transfer and delegation to Operator by the Participants of authority with respect to the operation of
)
Seabrook 1 under the NRC License and the supervision of the disposition of Seabrook 2, which has been cancelled and abandoned by the Participants, by appointing the Cperator as Managing Agent pursuant to Paragraph 36.2 of the Joint Ownership Agreement. i (ii) The parties hereto recognize that such transfer and delegation can only be accomplished after the NRC Amendment is issued and becomes effective. The parties agree to cooperate in good faith and use all reasonable efforts to obtain, and not t_- -
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k ! oppose directly or indirectly, the issuance of the' i i NRC1 Amendment and other: Regulatory Approvals on an appropriate schedule recognizing the overriding. interest of the Participants in maintaining-the i safe, efficient and reliable operation of the L Plant.and in assuring a smooth transition to a new ! n operator. The provisions of this Agreement ! relating to the transfer and delegation of such j L operating authority and the exercise thereof L L .shall become operative at the Time of f b> Effectiveness. l
)
l . .
-(111) The Operator shall use all reasonable efforts-to operate the Unit in a. safe, efficient and reliable manner in compliance with all applicable safety requirements, including but'not limited to the technical.specificationsLand the other terms and conditions.of the NRC Licenses, the rules and.
regulations of the NRC,-and any. applicable orders issued by it. 7 .(14v)-The Operator shall use all reasonable efforts to- !-i ocperate and maintain the Unit in a manner that L will-(a) promote the safety of workers at the Unit
'and the safety of the general public; (b) promote lO i
V
d 1 i
--8-- '
reliable _ Unit performance, high Unit i availability, a low forced outage rate:_and short
- outage durations; (c) conform to all regulatory requirements and binding-industry standards; and_ q q
(d) consistent with the goals described in the foregoing clauses (a)., (b) and1(c), produce'busbar.
- costs as' low as reasonably possible, through control of operating and maintenance ~ expenses and>
- restraint =in the commitment of capital funds.
(b)) On or_.,as soon as practicable after the Time of Effectiveness the_ Signatories will take the-following- -j k actions in order to. implement-the trancfer of authority contemplated herein
'(1) PSNH 'shall effect the? assignment to the: Operator of.the' responsibilities of the-Division (as agent?
~
for Participants) under all'.-outstanding contracts-
- and agreements-relating to=Seabrook Station which' !
a .x d W have heretofore been entered into by PSNH or;the- _l
-3 Division-either expressly or implicitly onLbehalf:
of-all Participants and will cooperate with the j operator-in negotiating appropriate modifications-reflecting the shift of authority being implemented hereby to any contracts relating to e _l. L v --__--l-.- , , - .e - . r .,
k,' e
. -9 :
Seabrook Station (such as the NEIL insurance-
-policy);which are subject to requirements which-
. preclude execution by, or-assignment'to, the Operator as Managing Agent; and (11); Subject to the reasonablo direction of the Executive Committee, the Operator shall assume responsibility on behalf of the Participants for all property tax negotiations with local ;
communities-relating to Seabrook Station y
'l facilities as to matters arising after the-Time ;
of' Effectiveness. , l I)I
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- 3. Manacino'Acent i
l
-(a) Commencing at the Time of Effectiveness and until-the expiration or termination.of this-Agreement, (1) the :
Signatories, owning: collectively 51%:or more of the p
~
Ownership Shares as required by Paragraph 36.2 of-the 4 Joint Ownership Agreement, hereby designate-tha
' Operator as--Nanaging Agent of Seabrook Station under the Joint ownership Agreement on behalf.of the Participants, and (ii).the Participants hereby employ. _
the Operator, and the Operator hereby agrees, to perform the engineering, operational and other E
)
Li .c professional services and responsibilities of such i Managing Agent on behalf of the Participants, in accordance with this-Agreement and-the~ Joint Ownership , Agreement. Subject to the'provisionsfof this Agreement which assign certain authority to the Participants and/or the Executive Committee, the-parties hereto agree that,.as. Managing Agent, Operator shall have i complete and ultimate responsibility for day-to-day k management of-the operation of Seabrook 1, including , theseEduties,. functions, responsibilities, ,
. -prerogatives, discretionary rights and authorizations [
to act on behalf of the Participants-which are a L described in the Joint Ownership Agreement.. Such- i responsibilities, inter alia, includeLauthority on all operational issues respecting?seabrook 1 to the extent necessary to comply with-the NRC License, j i H
! responsibility for:a11' licensing actions'with respect-i L to-Seabrook:1, and ultimate responsibility for~the q effective-implementation of=the quality 1 assurance.
program at:Seabrook 1.. L (b)-- TheLoperator shall promptly advise the. Participants of L . its'significant actions in discharging'its [ responsibilities, consistent with Section 6 of this-Agreement. 3
, -11 O I
.(c) The Participants shall approve or disapprove in advance, by a vote of 51% or more of.the ownership
- Shares, the Operator's selection of the senior on-site l manager for-the Plant.
1 l I (d) The Participants shall approve or disapprove in ] 1 advance, by a vote of 51% or more of the Ownership 1 Shares ~, significant government affairs and public relations policies pertaining to the Plant. i L(e)- The Part'icipants shall approve or disapprove in advance, by a vote of 51% or more of the Ownership j Shares, the incentive compensation programs and , aggregate payments associated therewith for Operator
-t
. personnel assigned to the Plant.
T (f)- The-Participants expressly withholdsfrom the Operator u e any authority to market or broker the capacity:or-i energy produced by the Plant on their behalf, and
-nothing ~ herein shall be interpreted las delegating to -
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.the' Operator any such authority..
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. 4 .; Services-The Operator agrees to-perform or cause to be performed all' the services and responsibilities assigned to it hereunder .;
p in_conformance with professional standards of care and practice. appropriate to the nature of the technical and professional services involved and in accordance with Prudent Utility Practice (as defined in Paragraph 8.1 of the , Joint Ownership Agreement), including, but not limited tot I 1 1 l(a)- selecting, employing, training and maintaining aufficient personnel-to staff Seabrook Station in f d accordance=with' license and regulatory requirements-
-i applicable to the operation of Seabrook Station and to L jl H
provide or cause to be provided any support services for such activities; (b) . planning for nuclear fuel' utilization at Seabrook 1 and. -
-procuring on behalf of-the: Participants the requisite-:
p nuclear fuel. therefor, including arranging-for all l Y H stages of-uranium. processing, fuel: design and
+ "
fabrication and eventual storage, transportation,. L disposition and/or reprocessing of irradiated nuclear i i L fuel'and the disposition of or use'of rc. processed i L-material;- l O ,
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< : (c_): __ purchasing _and maintaining on_ behalf of the i Participants, at. appropriate levels, inventories of-materials, suppl-les and' spare parts required'for j : operation:and^ maintenance of Seabrook' Station; ; a (d) after-consultation with the Executive Committee to-the extent reasonably. required by that Committee,. selecting and retaining: consultants and contractors to assist in the performance of the Operator's-responsibilities with
-j w u
- respect;to-Seabrook Station; R (e) subject:to paragraphs 24.2 and 37,4(d) of:the Joint ownership Agreement and the resolution regarding the-s
, 1 disposition'of--Seabrook 2 adopted by the Participants on November 6, 1986,> recommending to.the Participants, ; , specific actions concerning the disposal of Seabrook-h
- 2;- 1 1 !
.j l(f) reportingjto the' Executive Committee andLParticipants on1the1 operations and finances of, andithe insurance !
for, Seabrook Station in accordance with Section:6 of l Lthis Agreement; and 1 f , v-< v
~
(~)
\> (g) taking all other actions necessary in order to keep the Operating Licenses and other necessary regulatory permits in full force and effect.
Other than its responsibilities with respect to the operation of Seabrook Station, in carrying out its obligations as Managing Agent hereunder and under the Joint Ownership Agreement, the Operator may retain or appoint a service company or agent (which service company or agent shall be affiliated with Operator) to act on behal; of and perform the responsibilities of the Operator hereunder and under the Joint Ownership Agreement, so long as such appointment is consistent with the terms of the Operating License and the rules and regulations of the NRC. No such retention or appointment shall become effective unless the agreement (s) between the Operator and any such service company or agent has been approved by at least three or more Unaffiliated Participants, owning collectively 60% or more of the Ownership Shares. The Participants shall not withhold their approval of any such agreement if it is fair and equitable to all affected parties. 4
. . - -. __ . . . _ , _ _ . -.m -
jr'Y t s: .. V : 5.= Contractino Authority
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In conformity with the paragraphs 9 and 10 of the Joint Ownership 1 Agreement and subject'to Section 3 of this
-Agreement and-this Section 5, the Participants hereby 1
authorize-the Operator, as Managing Agent for the Participants, to enter into, and to execute.and deliver, such contracts with third parties for design, engineering, construction and technical support services or for insurance for Seabrook Station or for=the-purchase of materials, equipment, and nuclear fuel for Seabrook Station and for the
' acquisition of. interests-(other than title) in real-estate
;jw[ - essential coLSeabrook.1, as'the Operator deems necessary and a
'~! prudent, providad that'such contracts-shall-expressly provide that the Participants are severally.liablo in proportion to their respective 10wnership Shares, andsneither 1
, : jointly-nor jointly and severally liable thereont and 7 4
<provided,_further, that such~ contracts.shall provide for
-titlehto.any such-property which becomes_a fixture or integral part of Seabrook. Station to pass to the respective
- Participants 11n-proportion to~their respective-Ownership l 1
' Shares. Without-limiting the generality of:the foregoing, the' Participants'intendithat this authorization includes -i i
-authority to enter into operating leases for automobiles, equipment-and other facilities necessary, in the Operator's
- I r, J
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'h
-r I! 'T :
ju /L ' Lopinion, to the-operation ofESeabrook Station or toithe proper perforrance of the Operator's responsibilities hereunder. The Operator wil1 use its bestiefforts to .t
-negotiate contracts.that-do not include provisions for- a
-indemnification and/or-payment of special and consequential damagesjto third parties. In the event that the Operator findsLit'necessary to include one or more such provisions,
.it shall, to the extent practicable,-advise the Participants of such condition in advance of the execution
~
-{
H of such agreement. In any event the operator shall promptly i advise the Participants of1the inclusion of such
; provision (s)'after the execution of such-agreement (s).
,A L The Operator, without the prior approval 1 of the Executive- l Committee,:shall not enter into an agreement related to SeabrookiStation with-a vendor, contractor'or consultant-7t hat would require the Operatorsto refuse to furnish:any Seabrook-related information-that could_be': requested by a L -
-Participantion~the basis that~such vendor, contractor or I consultantDelaims-such information to be proprietary,- j Lprovide'dEt hat:such agreement may' provide nthat1any--
. Participant which: wishes to'obtain4any information treated as confidential.or proprietary by a vendor,. contractor-or u
' consultant'shallLsign+an1 appropriate-nondisclosure agreement requested by such vendor, contractor:or consultant. 4 T4 L
2 Major contracts and material modifications to such contracts for a) nuclear fuel and fuel services (excluding short-term spot market purchases); b) employment contracts with Seabrook Station personnel (excluding union labor contracts); c) contracts having a dollar value exceeding $10 million and either presenting significant liability issues or presenting long-term (at least two years) political, regulatory or public relations policy issues; and d) the acquisition of interests (other than title) in real estate essential to Seabrook 1 shall not be executed unless approved in advance by Participants owning collectively 51% or more of-the Ownership Shares. The criteria governing the types of major contracts requiring prior approval by the Participants, in addition to those specifically identified herein, may be reasonably expanded from time to time by the Executive Committee. Such additional major contracts shall be of the same magnitude and importance to seabrook Station as those described above. The Participants and Operator agree that, whether or not the Operator fulfills its obligation to provide that the several liability of the Participants is referred to therein, the Participants shall be severally liable, and neither jointly nor jointly and severally liable, for their
'{"'-
respective Ownership Shares of all obligations performable, ; i and all payments due,.under or with respect to any contracts l entered into concerning Seabrook Station executed on their =; behalf as contemplated by Paragraphs 9 or 10.1 of the Joint Ownership Agreement-or this section 5. 6.. Periodig_Bpportinc : (a) The Operator shall meet with the Participants no less < frequently than qucrterly to report on the status of Seabrook Station and discuss other matters regarding ; i l_ Seabrook Station. Each Participant-shall endeavor, in L./'s advance of the meeting, to notify the Operator.of the
~
V matters cif interest to that Participant for discussion. ; 1
?(b) .For each quarterly. Participants' meeting, the Operator i
shall distribute, at least seven-days in advance, a written operational report which shall include, but , not be limited to, the following: h (1) A brief summary of the Plant's* operation.since the last meeting of the Participants;
,e-i LV L
_ = _ = _ _ _ . . . . . - -
O
. (ii) A summary of Plant shutdowns and unusual load reductions since the last meeting of the Participants; (iii) The status of major capital projects (the criteria governing the projects to be reviewed shall be reasonably established from time to time by the Executive Committee);
(iv) A summary of any NRC, U.S. Environmental Protection Agency, New Hampshire Department of Environmental Protection, or OSHA violations, and the Operator's response thereto, since the last meeting of the Participants; (v) A list of the NRC elevated enforcement actions including confirmatory action letters, enforcement conferences and NRC-requested management conferences; (vi) A summary of new significant industry concerns that have a high potential impact on the Plant that would result in significant increased costs or a Plant shutdown; O
- 20-1
_ ip. _ .
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(vii-) A summary of major exposure items for the upcoming refueling outage;
-(viii) . A list, of other issues that the operator believes I
should be brought to the Participants' attention, e.g., related federal, state or local specific issues;
-(ix) .A summary of any event at the Plant declared by-the NRC.to have been an Abnormal Occurrence; n' (x) -A report on.' industrial safety, including status of the lost-time accident incidence rate since the
'last meeting and the beginning of the year; and (xi)-- Other items which the Executive-Committee-shall, from time to time, reasonably-request.
At the Participants' meeting,-the officer of-the Operator with operational responsibility for the Plant shall give a presentation on the significant items contained.in'the written operational report, as well as l the current status of the Plant. The officer will also. brief the' Participants on the results of evaluations-
s _,c-\
', )
and assessments of the Plant by the Institute of Nuclear Power Operations ("INPO"), since the last meeting of the Participants. (c) For each quarterly Participants' meeting, the Operator shall-distribute, at least seven days in advance, a written financial report which shall include, but not be limited to, the following: 1 (i) Actual operating expenses for the prior quarter and year-to-date comparing same to the approved budget. (The Operator shall explain, in detail, 1
,S all line item expenses which are budgeted to be I t ;
~
greater than 1% of the approved operating budget , and which are at variance from the approved ,
- budget by greater than 10%.- Each report shall identify actual expenditures not within the approved budget and actual withholding of expenditures which have been approved.);
(ii) A projection as to any significant year-end
. variances from the approved budget. (The Operator shall explain, in detail, all line item expenditures which are budgeted to be greater than
- 1% of the approved operating budget and projected-I s.
t- [N Ss-[ .133 be at variance from the approved budget by greater than 10%. The Operator shall also explain whether the total level of operating or capital :
- expenditures is expected to exceed the respective approved budget by 5%.- Each report shall identify proposed expenditures not within the approved budget or proposed withholding of expenditures which have been approved.); and (iii) -Other items which the-Executive Committee shall, from time to time, reasonably request.
- -jr-(- (d) Between the quarterly Participants' meetings, the q
~ '\,)
Operator (shall distribute,-on a timely basis, operational information which shall include, but not be limited to, the followings (1) A copy of_the NRC Systematic Assessment of r Licensee Performance :-("SALP") report, or
~
equivalent,-and the Operator's response thereto.
-(Copies of SALP reports are to be provided as soon. ,
as-reasonably possible'after they are released to ,
.the public_by the NRC.); ;
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'4 .-
(ii) LA copy of the year end INPO performance indicator report, or equivalent, for the Plant; (iii) A copy of the Plant's post refuel outage report; ;j L(iv) -A description of any event which results in a Plant shutdown or could extend a refueling ! shutdown by greater than two weeks; (v) -A copy of the NRC report for any'NRC violations in Severity Levels I,:II, or III, and the i operator's response thereto; M J (vi) A copy of any NRC report containing a proposed civil penalty' enforcement action; and a
- (vii), Other items which the Executive Committee-may, from time to time, reasonably request;
-(e): .Detween the quarterly Participants' meetings,.the Operator.shall distribute, on a-timely basis, '
financial information which shall-include, but'not be ljmited to,:the following:
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/7:
( /L i
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4
. 'Nf~)
-(1)E Monthly reports which wil1~ enable each Participant to meet its accounting, statistical, and
- financial disclosure requirements, including the requirements of any regulatory bodies having jurisdiction over ruch Participant. .(The Operator shall provide such accounting information in electronic format (i.e., magnetic tape or diskette) for those Participants which specifically request such. Subject to Section 7(a), covering the' cost of providing additional ;
I
- information, if any Participant shall reasonably request accounting or other information required ;
i iby this Section16 in a special-or dift'erent
~
--format,:such= request shall be granted to the i
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l- extent practicable.);=and l (ii) Lother: items which the Executive Committee shall', }:I~ from time to-time, reasonably request.
}
(f)! Notices of an Unusual-Event, Alert, Site Area
! Emergency, or General Emergency (as such. terms are defined in the Emergency Plans ~for the Plant) shall be.
distributed by.theLOperator to the Participants p immediately according-to the Emergency Notification i Procedures adopted by NEPEX, or equivalent. L AlI)/l L-1
# ,,.a r __-- - w- --
1 4 3 x _y (g) The Operator shall report to the Participants,.no less-a than quarterly, on the status of all decommissioning trust funds and all activity associated therewith. At least annually, consistent with the timing of the activities of.the New Hampshire Nuclear Decommissioning Finance Committee', or its equivalent, the Operator-shall issue a written report to the Participants on the ! l performance of the investment manager / trustee, as well j l i as1thelspecific investments comprising each trust fund. i i i
,s (h') By the end of the first quarter of each year, thc 3- / ' Operator shall furnish each Participant with a-detailed-list of insurance policies in effect for the Plant.. Such' list-shall-identify the insurer, coverage amounts, deductibles, premiums and other. relevant- !
information. To the extent that premiums.on policies-providing coverage for facilities ~other than the Plant are allocated to the Plant, the Operator shall so identify.and fully document the basis for such i allocation. The Operator shall promptly notify each- , Participant of any material adverse 1 change to any policy. i . L l L
1 l
/~
ls 5 l- -(i) ..Upon the-execution of an appropriate confidentiality c
' agreement ,between the Operator and eui individual
-Participant, the Operator will-provide auch Participant with copies of all evaluations and assessments of Seabrook Station and the Operator by INPO. !
. 4!
.(j) The Operator shall'rcport to the Participants, no less than' quarterly,.on the status of-any material litigation involving possible liability of all of the ,
Participants in'the project before any Federal or state court or administrative agency, d
. (k) Semiannually, the Operator will furnish to the
'l Participants data showing actual performance for'the y plant compared to-estimates and goals-contained in the approved. Annual Seabrook' Plan as described in Section 8. l
'of this. Agreement. ,
'7. JAccess'to Information i (a) Each Participant shall have the unrestricted right to <
all information relating to.Seabrook Station including,, but not-limited to, records and. correspondence within- 4 the control of the Operator, or any service company or agent' retained or appointed pursuant to Section 4 of- ,
+.
'. /
d J- - , _ ,, . _ . . . .
r this Agreement, wherever located ~except for information-
-which is a) protected by law, b) restricted by contract with third parties, or c) deemed commercially sensitive t
by-such service company or agent. If requested-information is restricted by contract with third i
. parties, the Operator, and such service company or r agent, will use.its best efforts to obtain the consent-of third parties to disclose _ confidential.information
]
.to Participants,-with the understanding that i
Participants may be required to sign a non-disclosure agreement. For_information which is considered. , i commercially sensitive to a service company or agent appointed or retained'by the-Operator, upon the request of one-or more Participants, such service company or agent shall allow for its review by lui independent l third' party,. selected by the parties involved (other than tho Operator and euch service company or agent) and acceptable to the Operator (provided that the-- Operator may not unreasonably _ withhold-its acceptance) lto. determine, using-an informal, simplified procedure,
-whether the informatic.n in question is commercially sensitive. In any event, if reasonable under the circumstances, the Operator may require a-Participant-
~
to sign a nondisclosure agreement covering information-that it considers commercially-sensitive. , u.
-__ - . . . .. ~ .. .-
.(
, l 1
.j- - ;
, t, Review of-information by Participants-at the offices of the Operator, or a service company or agent appointed ,
or retained by the operator, shall-occur at reasonable times during normal business hours, and shall 1x3 arranged in advance. The Participants shall use : reasonable efforts to avoid disruptingJthe business t operations of the Operator or such service company or
. agent.
t
.The Operator.shall coordinate and facilitate the
~
# . dissemination of information between.the project and L
the Executive Committee and/or the Participants, L tj[
/"%
i Upon request, the Operator.shall assist the Participants in regulatory proceedings and other 1
. contested: matters relative to the-Plant, including the
--provision.'of: witnesses-and of current-and accurate data cn1 a timely basis.
Information, including witness. support, that will
-require-a substantial commitment of. time or a-substantial effort to assemble or develop, and is 4 neither.a) required by a substantial number of-Participants, nor b) requested'by the Executive-
- ;;m
, ~ 29- ] i < 3- Committee,1shall be paid for by the Participant (s) requesting such information. The Operator, in consultation with the Executivo Committee, shall develop a reasonable: standard by which.it will determine how and when a Participant is to be charged:
for information requested.
' Subject to the limitations set forth clsewhere in this Sectionf7 any information relating to Seabrook Station shal1~be provided to any Participant requesting it, twith the understanding that the Participant may be
- requi' red to_ pay for the cost of providing it in the l 1
elrcumstances: described in the preceding paragraph. j (b.) 'Without limiting the generality of this Section 7, any i
-Part101 pant or the Executive Committee may request an l 1
audit of-the accounts ~and records of the-Operator, at ! Lits offices, atsrcasonable times,t by an independent: - certified' accountant _or other representative of the q Participant (s) requesting-the audit; provided however that,_ absent' extraordinary circumstances,-and: subject; to the rights of the Participants under Section-18
-l
_(Arbitration) ofLthis Agreement, a full-scope audit shall not be performed at the request of the Executive Committee or one or more Participants not affiliated
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.L-. - _ 4 . , . . . . . . ~ . . ,. . - , - - - .
with the Operator more frequently than once each year. If an audit is requested by the Executive Committee, the costs thereof shall be Dorne by all Participants in proportion to their Ownership Shares. If an audit is requested by one or more, but less than all, of the Participants, the costs thereof shall be borne by the Participant (s) making such request. If an audit is performed in connection with an arbitration proceeding, the costs of the audit shall be allocated among the Participants in accordance with the decision of the arbitrator. (c) Each Participant shall be notified by the Operator, sufficiently in advance, of exit interview meetings with INPO, on its evaluation report, and the NRC, on y its SALP report and enforcement conferences. Representatives of any Participant may attend vach meetings as observers. (d) Each Participant shall have the right to have its representatives visit the Plant, tour facilities, inspect project records (subject to Section 7(a) hereof) and observe Plant activities, provided that these activities will not interfere with the operation of the Plant, Plant safety or security. Such O
, k m . 33 ft 1 1 .
representatives shall comply with all applicable rules
.an d regu l at ions_ in effect at the Plant'whether imposed
- by; governmental authority or by the Operator.
y 18. : : Payments 1 Budoets
- c (a)_ .All~ services rendered by the-Operator, or by a service company.or agent retained or appointed pursuant to Section 4'of-this Agreement, under this Agreement will
- (
beratiautual cost thereof,-fairly and equitably J allocated =and calculated, all_ consistent with;the requirements of the Act and the rules and regulations E t- M -and orders-thereunder. Direct charges will bemade"for-. ! " Ay. ; services where a_ direct: allocation of cost is possible.- f d Charges-not directly assignable shall'be determined and
-allocated on:a reasonable'an'd equitable basis in accordance:with=PUHCA requirementsland.as approved by ,
I the' Executive Committee, which approval shall not be- 1
-1 unreasonably withheld. The-Operator shall obtain- ]
'ExecutiveTCommittee approval,zwhich approval shall not I
sbe: unreasonably. withheld, of the methodology.iutilized,
-as well as changes =thereto,- for allocating costs to the- !
project, prior to the. implementation of such methodology. Such allocation methods will be appropriately: documented and available for review by 4
1 1 l i/ 'y , (_f' the-Participants upon request. _ Without limiting the-l I
. generality of the foregoing, allocable costs include executive salaries and fringe benefits paid by the Operator, the employee wages and benefits paid by the Operator, the-insurance expenses incurred pursuant to Section 9 of-this Agreement, and other-general overhead expenses incurred by:the Operator. The Operator shall
' keep completo and accurate accounts of all receipts and - 1 expendituras hereunder in accordance with the rules and regulations of the Securities and Exchange. commission <
and tne Uniform System of Accounts prescribed for - Public. Utilities and Licensees subject to the Federal , JP-N Power Act, as amended from time to time (or such N] similar accounts as may hereafter become appropriate) (hereinafter the " Uniform System of Accounts"). I
-(b) The Participants shall pay the operator for all project costs and expenses incurred by thel 0perator in ]
accordance with the Joint Ownership Agreement. (c) In each calendar year during the term hereof, commencing with the first such year which-begins after
-the Time of: Effectiveness,-the Operator _shall prepare i
-and present:to the Executive Committee (with copies:to each Participant) the following budget informations-O
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$- (
(1) by November 1 of each calendar years .! i (A)L a detailed estimated: budget-for operating and maintenance expenses, disposal costs of nuclear fuel, and~any other funding- g i requirements'not contained int (1)(B) below,
'in a reasonable format selected by the Executive Committee, for the succeeding i calendar year (the " Proposed Annual Operating
-- i Budget"); j l
7-ss (B) a"six-year forecast of capital expenditures,. ; l including-a detailed budget of' expenditures ; for' construction activities-(plant additions 1and removals), and procurement of nuclear- j fuel for the. succeeding-calendariyear (cuch 1 1 capital budget for the succeeding calendar year being herein called the " Proposed Annual' Capital Budget"); and ; l (C) .a proposed annual plan.which shall ; comprehensively address all operating goals and objectives for the' Plant and its rtaff (" Proposed Annual Seabrook Plan") and the 1
- v.-
s i ,
- basis ~thereof and shall include any planned changes in the authorized staffing level for the Plant; and
'i (11) by_ June 1 Gf the subsequent year, a five-year ,
forecast of all expenditures defined in (1)(A) ! above, including a preliminary detailed estimated-budget'for the succeeding calendar year for expenditures defined in-(i)(A) and (1)(B) above l using a reasonable format selected by the j Executive Committee and a five-year plan for the-management of radioactive waste,-including t r projected. volumes, spent fuel inventory, processing and disposal plans and estimated costs. ; i l The Proposed Annual Operating Budget and the Proposed Lj Annual Capital' Budget, defined int (1)(A) and (1)(B)- above,Jehall collectively comprise the " Proposed Annual' j Seabrook Budgets".. All expenditures that;the .i
't Participante are expected to fund to the Disbursing-Agent over the succeeding calendar year,-are to be ;
contained in'the. Proposed Annual Seabrook Budgets.and presented on a monthly basis. , j -.
.}
s o IIs l N , . - - - . - . - -
tO
'- The Operator shall, as part of the development of the Proposed Annual Seabrook Dudgets, provido a forecast of other project related expenditures, such as property tax paymonts and decommissioning funding requirements, which each Participant is required to remit directly to an entity other than the Disbursing Agent. Such direct pay exponditures forecast shall not be included in the total Proposed Annual Soabrook Dudgets.
In advance of the mooting of the Participants at which the Proposed Annual Seabrook Budgets and Proposed Annual Seabrook Plan will be considered, which mouting
~
shall be hold on or prior to December 15 of each year, the Executivo committee shall review such Proposed Annual Seabrook Budgets and Proposed Annual Soabrook Plan and, after consulting with the other Participants, shall confor with the Operator regarding such Proposed Annual Seabrook Budgets and Proposed Annual Geabrook Plan for such calendar year. Subject to the provisions of Section 37.3(c) of the Joint Ownership Agreement, the Participants shall, by a vote of fifty-ono porcent (51%) or more of the Ownership Sharos, orther approve or modify the aggregate dollar amount of either or both the Proposed Annual oporating Budget or the Proposed Annual Capital Budget. Upna approval by the O
(. Participants, the Proposed Annual Seabrook Budgots, . reflecting any modifications made thereto by the Participants, and the Proposed Annual Seabrook Plan, reflecting any modifications made thereto by the Participants, shall be doomed to be the final annual Seabrook budgets (tho " Final Annual Seabrook Budgets") and final annual Seabrook plan, (the " Final Annual Seabrook Plan"), respectively, for such year. To becomo offective, the Final Annual Seabrook Dudgets and Final Annual Seabrook Plan for such year shall, subject to the provisions of Section 37.3(c) of the Joint ownership Agrooment, require approval by Participants owning fifty-one percent (51%) or more of the Ownership (~')
<- Sharos in the Saabrook Project before the prior December 31, provided that if Participants owning more than 49% of the ownership Shares do not disapprove of the Proposed Annual Seabrook Budgets and Proposed Annual Seabrook Plan in writing by the tenth day after the meeting called and held to consider it, then it shall be deemed'to be the Final Annual Seabrook Budgets I and Final Annual Suabrook Plan, respectively, for such '
year, i i The Participants may review the planning and budget process and request changes, subject to approval by i 1
I i f~)
's > the Executive Committee. The Operator shall make every reasonable effort to implement the changes reasonably requested by the Participants and approved by the Executive Committee. A decision by the Executive Committee to approve or disapprove any such requested change may be overridden by a vote of 51% or more of the ownership Shares.
(d) Subsequent to approval of the Final Annual Seabrook Budgets, the Executive Committee may, in the reasonable exercise of its discretion, approve the redistribution of expenditures among budget categories or budget items es to which the Operator shall conform. The Participants b shall approve or disapprove in advance, by a vote of Participants owning fifty-one percent (51%) or more of the Ownership Shares, increases in expenditures
. contained in the vinal Annual Operating Budget or the Final Annual Capital Budget if such projected expenditures are expected to result in total expenditures which exceed the respective approved annual budget by 5% unless there is an immediate need to proceed in order to_ maintain or restore the Unit to safe reliable operation, in which caso similar Participant approval is required if such increases are expected to result in expenditures which exceed the rx
, . . - , , - -. . - ~ ,
~ 38 budget by 10%. In no event shall the operator fall to comply with applicable law, the NRC's rules, regulations or orders, or the terms of the NRC License or Technical Specifications due to the need to obtain J. such approval. The Operator will make reasonable ; efforts to mitigate expenditures and avoid increases in approved budget amounta. Expenditures made for the purposes of regulatory compliance which were not anticipated in the approved budget and which result in exceeding the approved budget shall be reported-by the Operator promptly to the Executive Committee. (o) The Operator shall submit to the Participants for t!. air O i approval, by a 51% vote of the Ownership Shares, a detailed plan and budget pertaining to all its activities covering the period from the Time of Effective 7ess to the end of that calendar year. Such plan shall be' submitted at least 60 days prior to the q Time of Effectiveness, and shall include, but not be ; limited to, staffing changes, significant contracts 4 which the Operator proposes to terminate and/or assets
.which it proposes to_ abandon and the costs associated therewith. -
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~39-l (f) In the event that the Operator has obtained services from an affiliated company, as contemplated in Section 4 of this Agreement, such affiliated company shall, unless the Executive Committee otherwise directs, submit bills for such services to the Operator, and the Operator shall in turn bill the Participants for such services in accordance with the Agreement for Seabrook Project Disbursing Agent, as amended.
(g) In the event of a dispute as to the amount of any payment to be made to the Operator hereunder, the Participant or Participants disputing such payment shall notify the Operator of the amount in dispute and shall pay to the Operator the total payment including the disputed amounts. The Operator shall promptly refund, with interest from the date of payment until the date of refund at an annual rate equal to the lowest (i.e., " base") interest rate, in effect from time to time, at the Bank of Boston on 90-day commercial loans, any disputed amount ultimately found to be not payable. O
O I Ba. Certain Transitional Rules i In the event that North Atlantic Energy Service Company shall be appointed by the Participants to act as Disbursing Agent for the project and such appointment shall become effective prior to the time that Participants owning eighty percent (80%) or more of the ownership Shares have voted to amend Section 37.3 of the Joint ownership Agreement to authorize the annual preparation of twelve-month budgets (rather than the quarterly preparation of six-month budgets, 4 as presently required by-said section 37.3), then North i Atlantit, Energy Service company shall comply with the requirt.ments of the Joint Ownership Agreement and the First' Amendraent to the Seventh Amendment to and Restated Agreement for Project Disbursing Agent (such Agreement, as J the same may from time to time be modified,. supplemental or amended, being-hereinafter called the " Disbursing Agent Agreement") with respect to the manner, timing.and other- l matters affecting the budgets for the project and the i g. billing and disbursement of Project Costs, unless and until i Participants owning eighty. percent (80%) or-more vote to i amend Section 37.3 of the Joint Ownership Agreement to authorize the annual preparation of twelve-month budgets; l provided, however, that until said Section 37.3 shall be so amended, in addition to complying with the requirements of l O : l 1
-Section 37.3 of the Joint ownership Agreement and the Disbursing Agent Agreement, the Operator shall, for l informational purposon only, also annually prepare and distribute to the Participants twelve-month budgets, as contemplated by Section 8 hereof.
9, insuraneg
'The Participants hereby direct the Operator to implement
-Paragraph 10 cf the Joint Ownership Agreement.
The-Participants-further direct the Operator to obtain and maintain for the benefit of its officers, directors and-trusteas while acting in such capacities,-Directors and Officers Liability-Insurance in such amount-as the operator may-from time to' time determine, after consultation with
'the Participants.
10;- Decommissionino In furtherance of the provisions-of Paragraph 13A of the. .; Joint Ownership. Agreement, the Participants hereby designate the operator-as." lead company" (as that term is defined'in Chapter-162-F"of.the New Hampshire Revised Statutes Annotated) and delegate to the Operator authority to serve LOT , 4
; O as spokesman for the Participants, under the reasonable direction of the Executive Committee, in dealings with the State of New Hampshire with respect to the Seabrook Nuclear Decommissioning Financing Fund as contemplated by that statute. The Operator shall also perform all of the obligations of a Managing Agent under the Pre-Operational Decommissioning Funding Agreement, the Seabrook Pro-Operational Trust Agreement and the Seabrook Huclear Decommissioning Financing Fund Master Trust Agreement, all dated as of February 11, 1989, as the same may be amended from time to time.
- 11. Limitation of Liability
\
For and in consideration of the fact that the Operator is undertaking responsibility for design, engineering, construction, operation and maintenance of Seabrook Station for and on behalf of the Participants without any compensation or charge other than recovery of its costs for such services, no Participant shall be entitled to recover from the Operator or the directors, trustees, officers, employees, agents or affiliates of the Operator (or the directors, trustees, officers, employees or agents of such affiliates) (collectively " Protected-Parties") any damages resulting from the performance or non-performance of its O
)
*I)
respective responsibilities hereunder or under the Joint Ownership Agreement, or for any damage to Seabrook Station, any curta11 ment of power, or any other damages of any kind, including direct, incidental, consequential, special, indirect or punitive damages occurring during the course of the design, engineering, procurement, installation, construction, operation, maintenance, refueling or decommissioning of Seabrook Station or otherwise arising out of the performance or non-performance of this Agreement, unless such damages shall have resulted directly from the willful misconduct of the Operator, or, to the extent legally attributable to the Operator, directly from the 3 willful misconduct of a Protected Party. Notwithstanding the preceding sentence, no Participant shall be entitled to recover any such damages if such damages resulted from the Operator's or Protected Party's actions or omissions that have been expressly _ approved in advance by the Executive Committee or by the Participants, v
All goods and services provided to the project by a Protected Party shall be under a written contract having the same limitation of liability as above; provided, however, that the same limitation of liability shall also apply even if. goods and services are provided without a written contract. i
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C)/ The provisions of this Section 11 shall apply notwithstanding any provision of this Agreement to the contrary and shall survive the expiration or termination of this Agreement.
- 12. Term and Effectiveness (a) The term of this Agreement. shall commence at the Time of Effectiveness, providen that it has been executed by Operator and Participants owning at least 51% of the Ownership Shares of Seabrook Station, and shall
! continue until the date, after the cessation of commercial operation of Seabrook 1, on which the Participants and Operator are ultimately relieved.by the NRC of any further obligations with respect to the decommissioning of Seabrook 1, unless sooner terminated as horeinafter provided. (b) This Agreement may be terminated: 1 l l (1) By the Participants, at any timo, with or without cause, by the affirmative vote of 51% of all ownership Shares. l I
- 45-(ii) By the Operator, with or without caulo, upon twelve months prior notice to the Par'fripant a r
provided that the Operator may not give such . notice of termination during the first twelve , months following the Time of Effectiveness. (c) Any party terminating this Agreement shall give written notice of such termination-to the other parties. hereto, 4 stating the date on which termination is to occur _(the , -" Termination Date"). Notwithstanding such notice, the
. Termination Date shall not occur until any requisite amendment to the-Operating License has been issued and es is in effect.- The Operator agrees to cooperate with \/' the Participants to accomplish the orderly transfer of ,
its responsibilities-hereunder to any successor t designated by the Participants. On the Termination
.Date,cas a_ precondition to any termination hereof, the Participants shall pay to the Operator all amounts due. '
to it. hereunder and shall execute and deliver to i i operator such instruments as it may reasonably request. which evidence the-continuing obligations af the Participants in accordance with Section 11 of this Agreement. w . , , . , =. . - - , . , _ , , . ----.-_r-n..- ,. -.+mE-... . u...-.... , w: , - , . , y. ...+ nn..m-.,---.%,m.m.-.mr., , ,r ..,5,_,e-,.,,,,_m_,.7%,, , _ _ _ , ,
7_ r' (d) If the Participants or the Operator terminate this Agreement, the Participants shall reimburse the Operator for direct costs actually incurred resulting from such termination. The operator shall fully substantiate all direct costs actually and reasonably incurred and supply supporting documentation of such costs in reasonable detail. The Operator shall use its best efforts to mitigate the costs of termination. (e) This Agreement shall also be subject to termination and shall terminate, without any action by any of the ! parties hereto, to the extent and from the time that , performance may conflict with the Act or with any rule, 1 regulation or order of the SEC adopted before or after the making hereof.
- 13. No Setoff The Participants' obligation to make payments to the Operator hereunder is absolute and unconditional and a ;
Participant shall not be entitled to set off against the payments required to be made hereunder any amounts owed to it by the operator or any affiliate of the Operator or by any other Participant or the amount of any claim by it in
4
\- against the Operator or any affiliate of the Operator or any other Participant.
- 14. Annionment This Agreement shall be binding upon and inure to the benefit of the Operator and the Participants and the Participants' successors and assigns, subject to the l
limitations herein set forth. The Operator may not araign its rights and obligations hereunder. A Participant may not assign part or al] of its interests hereunder except as an integral part of a transaction involving an assignment of a corrorponding portion of its ownership Share which complies with the Joint Ownership Agreement.
- 15. IRL Third Party Benefielaries The provisions of this Agreemont are solely for the benefit of the parties hereto and the other-Participants and are not intended to benefit or cros.ts rights in any third parties.
- 16. Soveral oblications of Particleants The obligations of the Participants under this Agreement and any contract entered into pursuant to this Agreement shall ;
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- . . ~ . . , _ . , _ . . . _ . . . _ - - , _ _ . _ . . _ _ , _ . _ . _ . . . __,, . - . . . . . . . , .
'- be soveral, and neither joint nor joint and soveral, in proportion to the respective Ownership Shares of the Participants. Every document delivered to any third party by the Operator which may bear on the nature of the Participants' obligations shall specify such soveral (and not joint or joint and several) nature of the Participant's obligations.
- 17. Applicable Law.and Enforceability This Agreement is made under and shall be governed by and interpreted in accordance with the laws of the Stato of New Hampshiro.
(q/ In the event that any clause or provision of this Agreement, or any part thereof, shall be declared invalid or unenforceable by any regulatory body or court having jurisdiction, such invalidity or unenforceability shall not i affect the validity or enforceability of the remaining portions of this Agreement.
- 18. Arbitration Any dispute among a)-any of the Participants and Operator or b) any Participant and other Participant (s) with respect to O
this Agreement (" Disputing Parties") shall be submitted to arbitration on the request of any Disputing Party. Copies of any such request shall be served on all Participants and the Operator. Such request shall specify the issue or issues in dispute and summarize the submitter's claim with respect thereto. Within ten business days after receipt of such a request authorized representatives of the Participants and the Operator shall confer and attempt to agree upon appointment of a single arbitrator. If such agreement is not accomplished, any Disputing Party may request the American Arbitration Association to appoint an arbitrator in accordance with its Commercial Arbitration Rules, which rules shall govern the conduct of the arbitration in the absence of contrary agreement by the Disputing Parties. The arbitrator shall conduct a hearing in Manchester,14ew Hampshire, or at any other location mutually agreed to among the Disputing Parties, and within ; thirty days thereafter, unless such time is extended by agreement by tne Disputing Parties, shall notify the Participants and Operator in writing of his decision, stating his reasons for such decision and listing his findings of fact and conclusions of law. The arbitrator shall not have power to amend or add to this, or any other, Agreement, including the Joint Ownership Agreement. Subject to such limitation, the decision of the arbitrator shall be n-t
o
'- final and binding on the Disputing Parties except that any Disputing Party may petition a court of competent jurisdiction for review of errors of law. The decision of the arbitrator shall determine and specify how the expenses of the arbitration shall be allocated among the Disputing Parties.
- 19. Noticeg Any notice, demand, request or documentation to be furnished to any Participant or the Operator pursuant to any provision of this Agreement shall be provided in writing and shall be delivered either in person, by prophid telegram, by
( registered or certified mail, or by telecopier, telefax, or other electronic means with verification of receipt thereof to the officer, official, or agent of such Participant or Operator at the address indicated on Schedule A hereto or at such address as may hereafter be designated from time to time by such Participant or Operator by written notice to the other Participants and the Operator. 20, counterparts Any number of counterparts of this Agreement may be executed and each shall have the same force and offect as an original O ,
and as if all of the Signatories to all of the counterparts had signed the same instrument.
- 21. Amendment This Agreement may be amended from time to time by agreement in writing executed by Participants owning 51% or more of the Ownership Shares, except that voting requirements of greater than 51%, contained herein, may not be amended, and actions requiring a vote greater than 51%,-contained herein, may not be rescinded or superseded, except in writing by Participants owning such greater percent of the (s ownership Shares.
O
+
- - - +.n. - r--n,- --
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d IN WITNESS WHEREOF, each of the undersigned has caused this Agreemont to be duly signed by an authorized officer, and its respective seal to be duly affixed hereto and attested (or such uignature by an authorized officer to be attested to by a witness) on the date indicated but as of the date first above written. [ ATTESTED SEAL OR SIGNATURE OF WITNESS) NORT}! ATLANTIC ENERGY SERVICE COMPANY By: Its Dates PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE _. Byt - Its ___ Dates Ti!E UNITED ILLUMINATED COMPANY
- Byl Its Dates-EUA POWER CORPORATION-l BY8 l
Its l l Dates 4
.- w- a -,,-_.- ,w y -_ , , n_---- ,
( MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY By: Its Dates NEW ENGLAND POWER COMPANY By: Its Date THE CONNECTICUT LIGHT AND POWER COMPANY By: Its C)N (_ Date CANAL ELECTRIC COMPANY By: Its I Date MONTAUP ELECTRIC COMPANY By: Its Dates (-~ v
l
-54 NEW HAMPSHIRE ELECTRIC COOPERATIVE, INC.
By: Its Dates VERMONT ELECTRIC GENERATION AND TRANSMISSION COOPERATIVE, INC. By: Its Dates . TAUNTO3 MUNICIPAL LIGHTING PLANT By: Its Date HUDSON LIGHT & POWER DEPARTMENT By: Its Date: 0 t
._.m__.__m_:
- __._m.
i SCl!EDULE A l Addresses of Agents for Operator and Participants l e f l l 1 1 l l 1 l aar- --
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r g EXHIBIT B.2 pm
; P(1)
\
SEVENTH AMENDMENT TO AND RESTATED AGREEEENT TOR SEABROOK PROJECT DISDURSING AGENT This SEVENTH AMENDMENT, made as of the first day of November 1990, to the Agreement for Seabrook Project Disbursing Agent, dated as of May 23, 1984 (" Disbursing Agent ' Agreement" or <
" Agreement"),
as heretofore amended and herein restated to include all seven amendments, by and among Public Service company of New Hampshire, The United Illuminating company, Canal Electric Company (successor in interest to New Bedford and Edison Light Company), The Connecticut Light and Power Company, EUA Power Corporation, Hansachusetts Municipal Wholeaale Electric Company , Montaup Electric Company, New England Power Company, New O Hampshire Electric Cooperative, Inc., Taunton Municipal Lighting ( ,/ Plant, Hudson Light & Power Department and Vermont Electric Generation and Transmission Cooperative, Inc. (collectively, the
" Participants") and Yankee Atomic Electric Company (" Yankee" or
" Disbursing Agent").
WITNESSETH THAT WHERIAS, Commercial Operation of Unit No. I has commencedt and WHEREAS, the Participants and Yankee wish to amend certain provisions of this Disbursing Agent Agreement in order to provide for funding of the operation of Unit No. 1 and to make other changes as a result of the Seabrook Project moving from a construction budget to an operating budgets and ' ' ("\
'q) w . _ . ,
e i F { mtEREAS, the parties hereto desire that this Disbursing Agent Agreement be restated in one document which incorporates the seven amendments hereto; NOW, T}{EREroRE, in consideration of the foregoing and for other good and valuable consideration, the Participants and Yankee hereby agree that this Disbursing Agent Agrgement as amended prior hereto and on the date hereof shall read as follows. This Agreement in made pursuant to the provisions of Paragraph 35 of the Joint ownership Agreement to establish the powers, duties, responsibilitics, terms of employment and compensation of, and other matters respecting, the Disbursing Agent appointed to receive, hold and disburse payments due from Participants in the seabrook Project. 1. Joint ovnershie Aareemgg .Aeoointment of Yankee an Disburnina Acent under the 1.1. Apoointment. The Participants hereby appoint Yankee to act as their Disbursing Agent under the terms of the Joint ownership Agreement as now in effect and as it may from time to time be amended or modified in the future, and Yankee hereby accepts this appointment. The scope of the agency is as set forth in this Agreement. 1.2 Fowers ete.
, Yankee's powers, duties and responsibilities under this Agreement shall be limited to activities reasonably incident to collection and disbursal of i
-2
_ _ _ ---n. - - - ' - ^ ' " " " ^
i Participants' paynents for their respective shares of costs of the Seabrook Project, as is more fully set ou alow in Paragraph 1.5 and Paragraph 2. 1.3 Aceney. For purposes of this Agreement, the Participants agree that Yankee shall act as agent for each of the Participants individually (and not jointly or jointly and severally). With respect to certain other agreements, the following provisions shall apply (1) In the event of any conflict between the provisions of this Agreement and the Nuclear Support Services Agreement between Yankee and PSNH (as agent for the Participants), effective as of July 1, 1903, the provisions of this Agreement shall prevail. (2) The parties to this Agreement on April 27, 1984 () entered into an agreement entitled " Interim Agreement to Preserve and Protect the Assets of and Investment in the New Hampshire Nucicar Units" (" Interim Agreement"). This Agreement does not supersede the Interim Agreement, and any bills or invoices paid pursuant to that agreement chall not be paid or deemed paid pursuant to this Agreement. (3) In the event of any conflict between the provisions of this Agreement and the provisions of the Joint ownership Agreement, the provisions of the Joint ownership Agreement shall prevail. I
~3-
s l A.4 Iserowed runds_. 110twithstanding anything to the contrary contained elsewhere in this Agreement , all monies paid to Yankee under this Agreement, including , without limitation, vendor credits received under Paragraph 2.0 and rom gains f investment or interest under Paragraph 2 3 . shall not be the property of the Participants but shall be held at 411 times in escrow by Yankee in the accounts established under P aragraph 2.3 hereof to be disbursed by Yankee pursuantprovisions to the hereof. ' Upon termination of this Agreement , the Executive Coraittee will determine whether the moneys hl e d by the Disburning Agent exceed future Project costs and any necessary reserves and, if so, will issue instructions to the Di b s urning Agent fcr the distribution of such surplus con i intent and purpose of this Agr6ement. s stent with the (Fifth Amendment) 1.5 DisbursementA. Except as otherwise specifically set out hercin, Yankee shall disburse monies received om and fr credited to each Participant only to pay that Partici pant 's p_tg r.n.tA share, as defined in Paragraph 5.1 below, of Project Cost as defined in Paragraph 1.6. (Second Amendment) Monies received by Yankee from, or credited to, PS14H pursuant t o Paragraphs 23.10 or 22.11 of the Joint ownership Agreement may e be appli d only so pay MMWEC's pre-IA.tA share of Project Costs as defi Joint Ownership Agreement. ned in the (Sixth and Seventh Amendments) t 4
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__ , _ _ - - - - - - - - - - - ' ' _ _ _ _ - - - - - - - - ' - ~ _ _ - ' "
1.s Definition _s. As used in this Agreement, terms shall have the following meanings the following i costs of comp 1stier. means and includes osts all Project C that are subject to contractual commitm incurred by the Participants to compl t ent to be paid by or of'the Seabrook Project, e e construction of Unit 1 ! including, without limitation, costs s resulting from suspension and restarting after any) of the construction of Unit 1. suspension (if Without limiting the generality of the foregoing, costs of completi on shall include
., the cost Seabrook of the initial nuclear fuel Project. load or Unit 1 offthe
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1 (Seventh Amendment) Project' Costs means and includes those c Paragraph 1.5 above and in Paragraphs 11 osts described in Deposi't described in 37.3(d)(i) of the J i, 13 and the operating including costs of the design, constructio nt ownership Agreement, on, operation, maintenance, any) renovation and terminativn or dec ommissioning (if of, and fuel for, Unit 1 of the Seabrookc ,Proje t and with respect to the preservation, protection and a termin ti of the Seabrook Project. on of Unit 2 ; Costs incurred for one or more Participants' individual accounts are not P be billed to such Participant or Participantroject Costs but may 4 (Seventh Amendment) s by Yankee directly. O v I
() Project Manager means the New Hampshire Yank PSNH unless and until New Hampshire Yankee ee Division of El ectrio corporation or some other successor to said Yankee s received Division all ha necessary licenses and authorisations to replace PSNH and has replacad PSNH as Project Manager of the seabrook Proj and Seventh Amendments) ect. (rourth 2. Billinos. Deposits. Tnvestments and Pavnents 3.1 .. The Executive committee. , The Executive Committee established pursuant to Paragraph 37 of the Joint O wnership Agreement (the " Executive Committee"), or its s uccessor, shall oversee the f. unctions of the Disbursing Agent . The Participants authorize the Executive Committee or any designee such of .l Executive' Committee (1) to perform the functi in this Agreement, ons assigned to it and (ii) to provida direction to Yankee in the fulfillment of Yankee's responsibilitiese und srAgreement. thi Yankee agrees that it will operate under the di Executive Committee or its designee. rection of the 2.2 (a) (Fourth Amendment) Routine M_enthiv Billing. - Not Ihter than the 15th day of er. h month,-or the-first business ereafter, day th the Disbursing Agent shall, subject to the provi i s ons of Paragraph 37.3(f) of the Joint Ownership Agreement billing") each Participant for its EI2-IA1A O, bill (" routine mon wnership Share of the estimated Project Costs for the subsequent month under the approved then current six-months' budget, as established pursuant l 1 - l'_ _ ._ . . _ - . , , - _ . . - _ _ . __ . _ . __
to Paragraphs 37.3(a), Agreement. 37.3(b) and 37.3(c) of the Joint ownership Each invoice shall be due and payable on the first business day of the next following month. Any amount not paid on such date shall bear interest from said dateofuntil the date payment at the rate provided in the Joint ownership Agreement . In the event that one or more Participants have noi eir paid th routine monthly billing by the due date, the Disbursing Agent shall notify the Executive committee of such facteaands the d t il thereof a'nd obtain specific direction from the Executiv e Committee. Succeeding routine monthly billings shall set forth a reconciliation for the. previous month between the estimated Project costs previously billed, including any interimpayments billed pursuant to Paragraph 2.2(c) below, and the a actu l Project costs incurred. Such billings also shall set forth a credit or [ debit to the then current routine monthly billed amount o t reflect such reconciliation and interest due for late payment or other adjustments such as vendor credits and interestThe . routine monthly billings shall show as debits or credits the amounts necessary to restore the operating Deposit (as n defined i Paragraph 37.3(d)(1) of the Joint ownership Agreement) to the target amount set from time to time as provided ino the nt Ji ownersh3p Agreement, and such amounts shall be funded by the Participants as prov'ded in Paragraph 37.3(d)(i) and of (d)(ii) the Joint ownershi, greement. The Disburning Agent shall not U
i,t l
,, vil j. g.
- 3. [h
/N : include ~1n.a routine monthly billing for Project costs ' "O" < l for funds 1for a major ~ expenditure unless such expah=l ,
by the Disbursing Agent during the month foroutine - which the r monthly billing is made. Unless otherwise directed by the Executive Committee or provided by th e Joint ownership Agreement, any net' interest paid by any~ Participant with respect , s to it 1 l overdue payment for any month's bill shall be credited y the b Disbursing Agent, RI2-IJd;A determined by owner h those Participants'which mad.t s ip share, to' timely payment of their bills.for each such month.-(Seventh Amendment)
'2.2 (b) , Qooratirie Denesit.
- After Commerci l' a operation vf Unit No. 1, the: Disbursing Agent-ahall bill c ea hP ,
c - articipant for
'its DIS-IAln share of the target amount of athengoper -
Depost-ti as :provided in Paragraph 37.3(d)(1) -at ownership Agreement. (ii) of the Joint such billing shell be included in the routine rionthly billing made by the' Disbursing Agent under Paragraph 2.2(a).above.- The operating Deposit - a sh ll i
.be held by-the Disburning Agant with the routin e monthly billing. payments
" - to provide aufficient working capital- fer the P
. roject,.in escrow l as provided in Paragraphs 1.4 and 2.13-of this1Agreeme t
] n and in ' !
4 Paragraph " a(h) of the Joint ownership Agreen ~
. the benefL a ent, solely.for.
creditors of the Project, ' to be = disbursed solely-to pay-each Participant's ownership Share o ect of Pr jand Costs,
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-__s _ _ _ _ _ _ _ . _ _ _ _ . _ . _ _ _ _ _ _ _ _ _ _ - _ _ _ _ _ . - ._ _ _ _ _ _ . _ . - . __ _ _ . _ _ _ _ _ _ - .e- -. .w
e g- at no time shall any of such funds be the propertye of th Disbursing Agent. l (Seventh Amendment)
- 2. 2 (o) Interim Dilling.
Subject to the prior approval of the Executive Committee, the Disbursing Agent , whenmay and to the extent authorized by Paragraph 37.3 (g) Agreement, of the Joint ownership obtain an interim payment from each Participant by means of an interin billing to all Participants, forment payof unanticipated expenditures which, in the absence of such int erim s payment,' would result in the reduction at the end of th t the sum of (i) e month of the balance of the Operating Deposit and (ii) the amounts of funds then remaining from the routine monthly ngs billi o the minimum re, quired amount set forth in Paragraph . g) of 37 3 ( the Joint ownership Agreement, or less. To the extent that any interim billing would result in estimated Project C osts exceeding () the then current six-months' budget, such interi m billing shall require approval, in advance, as provided in Paragraph . c) (1) 37 3( and (ii) of the Joint ownership Agreement. Upan receipt of the aforesaid required approvals, the Disbursing Agent shall without delay bill each Participant for its EL2 Lala owne rship Share of the interim billing which shall be the amount ne w nssary to restore said minimum required balance. Each 1. tm billing shall be due and payable ten buciaess days after issua nce by the Disbursing Agent and any amount not paid by such d t a e shall bear interest from said due date until the date of payment at the rate i 9
l 4 , hs
\ ,/- provided in the_ Joint ownership Agreement.
shall be accompanied by a letter from the Project MEach anager or tne Managing Agent confirming the amount required and th the request. e reason for
~(Seventh Amendment) 2 3 (a)
Deeesit of runds. The Disbursing Agent shall i establish one or more bank accounts s (" bank
) at one or acc mwre banks 'or trust companies organized under the law s of the United States or one of the statesned with a combi capital and surplus 'of at least $10,000,000, ;
which is subject to supervision or exantnation by federal or state authority and i s not a creditor of any Participant.- the right to approve the selection ofThe Executive Commit , Agent to change bnnks if the-Executive committ, and direct ee determines such
-to be in the best interests of the Project.
(< sf The monies deposited and' held in all bank accounts shall atsubject all times to - be the provisions of paragraphs 1.4 and 2 13 of thi s Agreement and Paragraph 37.3(h) of the Joint ownership Agre ement, and each bank account account. shall'be denominated'to showescrow that-it in an (Seventh Amendment); 2.3(b) Investment of Monies. To the extent that monies held in bank accounts are not-immediately required t o pay Project Costa pursuant to Paragraph 2.5 of this Agre Agent shall to the maximum extent practicable inement, the Disbu vest such monies in one or more investment pool accounts (" investment poo 4
4 I accounts") which have been selected by the Disbursing ent Ag pursuant to investment guidelines developed and modifi df e rom time to time by the Disbursing Agent, all with the approval of the Executive committee. Annually, a Perticipant shall inform the Disbursing ^ gent of the partiaular investm prefers. T' ent pool account it accounts a: monies deposited find held in all inve,stment pool all earnings and gr. ins thereon shall at all times be subject to the provisions of Paragraphs 1.4 and 2 13 . of this Agreement and Paragraph 37.3(1) of the Joint o wnership Agreement, and each investment pool account shall be denominated o show t that it is an escrew account. The Disbursing Agent shall maintain records which show the earnings and each gains of investmont pool account and the credits from sa h c earnings and gains which are attributable to each Partic3 cant . Such credits shall be entered into the escrow account maintained the by Disbursing Agent in the name of such Participa n. Each t Participant shall directly pay such taxes on such gains and earnings on investment pool accounts as may be attrib it. utable to (Seventh Amendment) 2.3 (c) Executive committee satisfaction. The procedures fot selecting, establishing, maintaining and cha nging bank accounts and investment pool accounts, and the receipt
, holding, investment and disbursement of all monies and credits, shall at i
( O
p , d all' times be satisfactory to the Executive committee. Amendment)
-(Seventh 2.4 Daily Payment _Certifichten.
On a daily basis,-the Project Manager shall present a certificate to Yankeegned si by an officer or authorized agent of the Project Manager, certifying: (1) the total amount of payments to be made for bills ,
-invoices and requests for payment covering Project Costsi and -
(ii) that such expenditures have been authorized as provided in Paragraph 37 of the Joint ownership Agreement . Such certificate, when accompanied by an invoice oeappr vdb y the Project Manager, an audited voucher and a check red (if requi by sankee) for each payment being made, shall be presented to Yank for Yankee's review and: payment. 2.5 (Fourth and Seventh Amendments) Preiset costa Pavnents.
. Yankee-shall withdraw and
- disburse monies' from the' appropriate bank accounts t 4
o pay each Participant's: Erg IA,t;A share of Project costs, but Yanke e shall pay only those Project bills that have been duly certified as provided in Paragraph 2.4 above. ; (Fourth Amendment) Before making. payment, Yankee shall review all Project bills submitted . for payment to ensure compliance with these requirements .. After L
'following-these procedures ,
Yankee shall pay lsuch approved ~) Project bills, in.whole or in part, directly to the vendors, as 4 provided in Paragraph 1.5 of this Agreement.
.' In the event of, ;
p .:
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A . . _ _ _ . . ( t ( and as a condition to, a partial payment, Yankee shall obtain from the payee a release or waiver, in a form ap proved by the Executive committee, of liability, of each Parti i c pant that has contributed its nra r_ata share of such payment ga (includin waiver.of liens on seabrook Project real or personal operty), pr unless case. the Executive committee otherwise directs ecific in each 2.6 Yender credits. The Project Manager will deliver to Yankee, without delay, any and all monies derived f rom vendor credits, chargebacks and other reimbursements ("vendo that it receives on the Seabrook Project r credits") The Project-Manager will notify all vendors to deliver all such vendor credit s on the Seaba'ook Project to, and to make such vendor e cr di ts payable to, Yankee as Disbursing Agent for the Participants 4 \() . Checks or other instruments representing such. vendor credits p
, if payable to the Project Manager, shall be properly endorsed by th e Project Manager or its agent to be payable-to the order of Y Disbursing Agent. ankee as PSNH hereby irrevocably grants to Yankee the power so to endorse any such checks or instruments e to payabl PSNH as Project Manager but delivered to or obtained y Yankee b
without such endorsement by PSNH. Upon receipt of such vendor credits,LYankee shall promptly deposit the same into the appropriate bank account and credit each Participant EIS IAla according to its rt.spective ownership Share at the time the 1 L U . l: l'
expense was billed to the Participants, except that if any .
\ Participant did not pay its EIS rata share of such expense , such Participant shall not be entitled to such credit.
Yankee shall disburse all'such vendor crediv solely to pay Project cost s. If any Participant has a surplus of such vendor credits over its EI2 Iaia share of disbursements for Project Costs, Yankee shall retain such surplus and shall disburse it, in accordance with Paragraph 2.5 above, to pay such Participant's RIS Iala share of Project Costs in subsequent months. 2.7 MMwrc credits. Notwithstanding any other provision of this Agreement to the contrary, credits, refunds
, recoveries and damages (collectively " Credits")
to which MMWEC would be entitled but which arise on account of payments made by Yankee ns from fu d provided by other Participants on or (.fter July 28, 1988 (including payments made from funds deposited with eYankee ore bf July 28, 1988) of MMWEC's ar.2-Iala shars of Seabrook Project Requirement Estimates, shall be applied by Yankee to MMWEC's Supplementary Advance Payment Account in accordanceankee's with Y prior practice; crevided_, that if any credit is in the amount of Twenty-Five Thousand Dollars ($25,000.00)-or more , such Credit shall not be so applied by Yankee, but Yankee shall deposit the Credit into the main account of the Participant which made the payment to which the Credit relates; except that any such credits related to MMWEC Supplementary Advance Payments made under 9 f V -m _ _ - - _ _ - . - - - - - - - -
Paragraph 23.10 or 23.11 of the Joint own ership Agreement, which credit is received while PSNH is obligated to make such paynents, shall be deposited into the MMWEC supplementary Ad Account. vance Payment 2.8 Executive Committee Ynetructions. Yankee shall report to the Executive Committee or its designee (1) for,overall direction in carrying out its function , (2) for specific approval of or direction with respect to payment of specifi bills, c Project l'f Yankee believes that there is a question as t o whether such Project bills have been duly certifiad o r have been duly authorized under Paragraph 37 of the Joint ownershi and (3) p Agreement for specific approval for payment of bills related to any program adopted to reconcile past unpaid bills . Yankee shall _p also provide a monthly report to the Participant s itemizing, in d appropriate form and detail, and in any event i n such form and detail as the Executive Committee may di rect, all Seabrook Project disbursements, credits, expenses , investment and interest income2.9 and monies received from pants. Partici Recorda. (Seventh Amendment) Yankee shall maintain separate records of each Participant's payments, credits applied on it , s behalf and disbursements applied against its payments and credits. Yankee shall also maintain combined records of all s, deposit investments, certificates and disbu , to, the banks accounts and shall reportrsements from, and relating on such matters as O
_ .. -- - ~ . . . - ....- . . .. - - . . - . - ,. I
.. j provided in Paragraph 2.8 above.
i available at its offices atmes - reasonable tiYanke an. independent certified public acc for examination by ountant or.other reprrientative, as-designated by r a Pa ti in interest 'of- the - Participants cipant, or by a majority Such. examination shall be at th , requesting the examination..
- Participants' requesting the e expense of the Par,ticipant or examination.
2 10-- ComnensatLEB. its services under this AgreementYankee shall - cost forbe comp n. Participants for its services u and shall bill the several > Executive-Committee or its gnee. desi pon approval of its charges by the . Each Participant will pay its RIE IntA share of such
'such bills and shall only be liable-for EIS IAla. share.
2 11 , Consultants.
; engage such consultants as it sees fitThe orized Executive ta t
) i
.out 'ts functionLunder this Agreement n a dto assist-it in car i Participant on a monthly basis f shall_ bill each each such. Participant's EIS IA1A Ownershior the cost the i Each. Participant will' pay its EI p Share of such' costs.
1 shall only.be liable for such R IAla share of such bills and' 2 12 - g3morts. 2K2.IA1A share. obligations of PSNH or other Project MThis Agreem e anager to provide accounting: reports to the'other~Particip Joint 0wnership Agreement . ants pursuant to-the t
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~ Yankee covenant re_Eserowed .
Yankee runds agrees and \
+- stipulates that neither it nor any of it any interest-in the bank accounts, s creditors shall have or in monies deposited therein or creditthe investment po ,
s applied thereto,'and tnat the bank accounts and invest created and are being held in escrow sol lment pool accc bills have been certified for payment e y for the vendors whose above, subject to the terms of, and to mai t ipursuant to funds in the' bank accounts in acc n a ning and disbursing '4 ordance with, this Agreement.
. [Fifth and 2.14 Seventh Amendments)
PSNM/MMWEc Settlement. ; provision of this- Agreement to the co tNotwithstanding any. ' 1,~1989, \ end in-order to give effect thereton rary, on and af ter (a) ..
}' MMWEC shall have no liability for payment or repayment to Yankee of any amounts appli ed by Yankee
.for MMWEC Project Costs from funds held by Y ankee for MMWEC's account since June 1
, 1988 (including peyment or refunding any of the pre-funded amount s drawn down by MMWEC from June 1, 1988 through J uly 28, 1988);'=
(b)~- MMWEC shall have. no liability to pay any interest q or penalties:With respect to the afor k of. funds'by Yankee or with respect to Mesaid application MWEC's non-payment of MMWEC Project Costs;
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'f . j (c)
PSNH shall not incur any additi O w liability-as a result of makin onal obligations or s Paragraphs 1 and 6 of the Me g payments required under of November 4, ,
-. 1988 between PSNH and MMW the additional liability tha t , except for \
to the obligations of MMWECPSNH assumos with respect 23.11 of the Joint Ownershi under Paragraphs 23.10 and only to the extent specifically pp Agreement, as (d) j i and MMWEC shall not beanyliable PSNH.is to forrovided the payment which. Joint ownership Agreementmake .11 of under Pa the PSNH makes such payment.as amended, whether or not
;2 15 j Eurt her_Amstndment. - (Sixth Amendment) not specifically amended by the SixthThe provisions ment of th M 'without limitation the pr Amendment t including !
t N to have been modified, witho tovisions of Section eemed 5.1, shall i i
- amendment, '
as may be necessary to give effect tu the a \ of. Paragraphs 23.10 and 23.11 of th o the provisions ! j with respect to payments to be mad e Joint Ownership AgreemeJ MMWEC but for.said Amendment would have bee by P
'[ Sixth-Amendment)- en obligated to make .
a s i l g
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i w) , i u
- 3. R
.f ,\_J Euccessor. emoval or Resionation of Yankee anA_Accointm \ Yankee may resign at any time by giving twenty on - e (21) days' prior written notice thereof to each of th e Participants. Such resignation shall become effective on the d t a e specified in the notice, or upon the appointment of and acc eptance by a successor, whichever is earlier. Upon agreement of Participants owning sixty-two percent (62%)-(Fourth Amendment) or \ more of the ownership Shares in the Seabrook Project, i the Participants may at ! any time remove Yankee without cause upon twenty-one (21) days' prior written notice to Yankee, and with cause upon days' prior written notice to Yankee. seven (7) Such removal shall become effective on the date specified in the notice . In the event of resignation or removal, Yankee shall be entitledmpensation-to co under paragraph 2.10 of this Agreement until the effecti ve date of such resignation or removal. is removed, In the event Yankee resigns or the Participants shhl1 use their best effort s to appoint a successor upon agreement of Participants owni two percent ng sixty-(62%) [ Fourth Amendment) or more of the Participants' ownership Shares in the'Seabrook Project. Any successor agent shall execute an instrument accepting such appointment and shall thereupon become vested with and subject to all properties, rights, powers and duties of Yankee, as if-originally named in the provisions hereof.(including this Paragra p 3). h Yankee
-shall duly assign, transfer and deliver to the successor age i
k} ,
.f. . .i all records, property and money held b I that Yankee may retain copies y it hereunder, provided i
- 4. - - Liabili ty of such records.
41 and indemnification. { XAAlia.. Yankee shall not be responsibl genuineness of any signature and may e for the ! shall be protected in acting uponrely conclusively upon, and ! request, , any certificate g notice, consent, statement or other instrume n t good faith to be duly authorized n a d believed by it in properly made. and obligations of Yankee hereunder a sh llThe duties the provisions of this Agreem be governed solely by 'h
-Agreement.
Neither Yankee nor its officersent and the J liable to any other Party to this A or employees shall be
' direct, incidental,, indirect, conse greement for claims for any nature, including, but not limit e dquential or other damages of
( anticipated profits, loss of use of re to, damages for loss of construction shutdown or interruption venue, loss by reason of i connected with or resulting from the , and cost of capital, Agreement by Yankee,-except in performance of this ! th
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'In addition, the Participants, severalle event of willful-miscond jointly ~and severally),-in acco d y (andlnot jointly or ItLin Ownership shares as specified ir ance with their- respect >
defend, indemnify and hold' Yank n Paragraph 5.1, agree to harmless against all-losses, claimee and-its officers and employee
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reasonable counsel fees).and liabilitis, expenses-(including ' es, not resulting.from { I
;[
v
Yankee's willful misconduct, which may be asserted, imposed or incurred in connection with the perform ance of its responsibilities hereunder, including any litigati the foregoing. on arising from Yankee shall not have any duty to use its own funds 1,n carrying out its responsibilitie 4.2 s under this Agreement. Executive cotmittee. Neither the Executi,ve committee nor any member nor designee thereof, when acting i n such capacity, nor any employer of any member or desi gnee, nor any affiliate, agent er employee of such member
, designee or employer, shall by virtue of its relationshi p to the Executive comittee or any Executive committee member neee acting or desig in such capacity, be liable to any P arty to this Agreement for claims for direct, incidental, indirect, damages of any nature, consequential or other including, but not limited to , damages for loss of anticipated profits, loss of use of revenue., loss by reason of construction shutdown or interruption
, and cost of capital, connected with or resulting from the perf ormance of this Agreement by the Executive committee or by any member or designee thereof or by any employee of any member affiliate, agent or employee of such nemberor designeo or any
, designeo or employer, except in the event of villful miscond uct. In addition, the Participants, severally (and not j i nd severally), o ntly or jointly in accordance with their respective p
.rq rata shares as .specified in Paragraph 5.1, agree to d efend, indennify i
_ _ _ - _- --- - " ~
9 and hold the Executive Committee each member and des'ignee I) thereof and each of the other the preceding sentence, harml persons or entities referred to in expenses (including reasonable couess against all losses, claims, resulting from his or their willful minsel fees) and liabilities, no asserted, imposed or incurred in c sconduct, which may be of his or its responsibilities her onnection with the performance litigation arising from the foregoieunder, ng. including any 5 Miscellane_ons. 5.1 Liability of Partici unts. Participants hereunder are nrg All obligations of the joint and several) and, with ra.tA and several (not joint or to the proportion of such Parti irespect to each Participant, limited Seabrook Project to the total c pant's ownership Sht.ro in the Seabrook Project of all ownership Shares in the (]')
~
As of the date of execution of thi(called s Agreement). a "gtg rgL s Agreement, of each Participant is as follows: the nIn rata share PARTICIPANT QWNERSHTP SHARE The United Canal Electric Company Illuminatingampshire CompanyPublic 35.56942% Service C 17.50000% Hudson Light and Power o. DepartmentThe 3.52317% connecticu Massachusetts Electric Co. Municipal Wholesale 4 05985% 0.07737% Montaup Electric Company New England power Company 11.59340% New Hampshire Electric Cooperati ve 2.89909% Taunton Municipal Lighting Plant 9.95766% 2.17391% 0.10034% V
' Vermont Electric Generation & o Transmission Cooperative, Inc. 0.41259% EUA Power Corporation __12.13240t 100.00000% (Fifth Amendment) The Executive committee shall notify Yankee promptly of any l changes in each Participant's EI2 IAla share. Every document delivered to any third party by Yankee pursuant to ,this Agreement which may bear on the nature of the Participants' obligations hereunder shall.specify suen several (and not joint or joint and several)' nature of the Participants' obligations. 5.2 Eneaid Proieet Costs. Without limiting the generality of. Paragraph 5.6, nothing in this Agreement shall constitute or be construed as a waiver or limitation on the enforceability of, or an election of remedies with respect to, the rights of the Participants other than PSNH to recover PSNH's unpaid share of () Project Costs, if any, or its share of interim care and protection costs paid by other Participants pursuant to the Interim Agreement or to enforce other claims (whether now existing or arising in the future) against PSNH. (Seventh Amendment) 5.3 Governina tav. This Agreement is made under and shall be governed by, and construed in accordance with, the laws of the State of New Hampshire. 5.4 severability. In the event that any clause or provision of this Agreemerit, or any part thereof, shall be
4 s I declared invalid or unenforceable by any regulatory bd o y or court having jurisdiction, such invalidity or unenforceability shall not affect the validity of the remaining portions of this Agreement. 5.5 survival. All provisions of this Agreement providing for limitation of or protect 1on against liability ghall apply to the full extent permitted by law and shall survive ter i this Agreement. m nation of 5.6 Richt of Vendors. This Agreement is not intended, and shall not be construed, to create or acknowledge any n rights i favor of persons who or entities that are not parties ot this Agreement, except for rights of vendors whose bills hav e been
' certified for payment pursuant to Paragraph:2 4 .
, subject to the
(] (~/ terms of, and to maintaining and disbursing the ba n k accounts and investment pool accounts in accordance with 'this, eement. Agr o Anything in.this Agreement to the contrary notwithstanding , the i Participants agree that this Agreement is made without prejudice to,1and does not constitute a waiver of, or election of ! remedies ' with.rcspect:to, or limitation on the enforceability, ct any rightsnor claims which any Party-or Participant may now have or in the future have against any;other Party-or Parti i c pant. [rifth and Seventh Amendments) i 5.7 Corcorate Acts. This Agreement is the act and obligation of the-Parties heroto in their corporate capacities . l t p
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q i 5.s Effectiveness. _/ The Seventh Amendment hereto shall become effective upon execution by Yankee and by Participants owning ninety-five percent (95%) or more of the ownership Shares in the Seabrook Project, and upon its effectiveness, all Participants shall be, and be deemed to be, Parties to this Agreement as amended by the Seventh Amendment). (.?eventh Amendment) 5.9 countercarts. Any number of counterparts of this Agreemen't may be executed and each shall have the same force a effect as the original. 5.10 Amendments. Upon the Seventi. Amendment becoming effective, this Agreement may thereafter be amended or modified by an instrument executed by Participants owning fifty-one percent or more of the ownership Shares in the Seabrook Project ( and by Yankee; provided, however, that this Paragraph 5.10 and the definitions of " Project costs" and " Cost of completion" in Paragraph 1.7 hereof, may be modified or amended only by consent of Participants owning ninety-five percent or more of the Ownership Shares in the Seabrook Project and v ankee, and orovided further that any amendment to this Agreement which would have e th effect of modifying the terms of the Joint ownership Agreement shall not become effective unless approv.-d as provided in Article 29 of the Joint ownership Agreement. (
+
5.11 Notices. Unless otherwise provided herein, notices
;[ )-
- and other communications required or permitted to be given or made under'the terms of this Agreement shall be in writing, and shall be deemed to have been duly made or given when delivered personally 'or when made or given by telex, telegraph or telecopier, prepaid, at, in the case of each Participant such address and to the attention of the chief executive officer or such other person as may be designated from time to time by a Participant in accordance with the Joint ownership Agreement; and, in the case of Yankee, to Yankee Atomic Electric company, 580 Main Street, Bolton, Massachusetts 01740, Attention:
Treasurer, or to such other address or to the attention of such other person as Yankee may from time to time designate by notice in writing to each Participant. s( (Fourth and Seventh Amendment
' IN WITNESS WHEREOF, each of the undersigned has caused this l
Agreement to be duly signed by an authorized officer and attested (or such signature by an authorized officer to be attested to by l a witness) on the date indicated but=as of the date first above ; written.
1 O CANAL ELECTRIC COMPANY B,
Title:
THE C0!!NECTICUT LIGHT AllD POWER COMPANY By- '
Title:
EUA POWER CORPORATION By-
Title:
HUDSON LIGHT & POWER DEPARTMENT By-O
Title:
MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY By Titles _ MONTAUP ELECTRIC COMPANY By-
Title:
O
- , . . - . _ . . .- - . . . . . . . . . . - . ~ . - .
. . . _ ~ _ - . .., . - . _ . .-
7 1
- l T-NEW ENGLAND POWER COMPANY By__
l q Titles _ l
* .}
NEW HAMPSHIRE ELECTRIC-COOPERATIVE
\
By_ 1
Title:
1_ . ..t
. r, PUBLIC SERVICE COMPANY OF NEW' HAMPSHIRE, DEBTOR AND DEBTOR-IN-POSSESSION .i By-
Title:
- 3 s 1 TAUNTON MUNICIPAL LIGHTING p_ PLANT-
-6 By_ .
Title:
THE UNITED ILLUMINATING-
-COMPANY ~ '
By_ Titlet- -i VERMONT ELECTRIC GENERATION' :-u ' AND INC. TRANSMISSION COOPERATIVE, 'l
.By 1
Title:
?
28 - b , 4 ['
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hhNhkh[ By Title t 1 l 4 e 4 4 O 29 -
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l O FIRST AMENDMENT TO SEVENTH AMENDMENT TO AND RESTATED AGREEMENT FOR SEABROOK PROJECT DISBURSING AGENT,
-sTED AS OP NOVEMBER 1, 1990 This FIRST AMENDMENT, made as of the day of
, 1991, to the Seventh Amendment to and Restated Agreement for Seabrook Project Disbursing Agent, dated as of November 1, 1990 (" Disbursing Agent Agreement" or " Agreement"),
by and among Public Service Company of New Hampshire, The United Illuminating Company, Canal Electric Company (successor in interest to New Bedford and Edison Light Company), The
- Connecticut Light and Power Company, EUA Power Corporation,
() Massachusetts Municipal Wholesale Electric Company, Montaup Electric Company, New England Power Company, New Hampshire Electric Cooperative, Inc., Taunton Municipal Lighting Plant, Hudson Light and Power Department and Vermont Electric Generation and Transmission Cooperative, Inc. (collectively, the
" Participants")-and North Atlantic Energy Service Company
("NAESCO") (successor to Yankee Atomic Electric Company). WITNESSETH THAT: WHEREAS, by order in File No. 70- , the Securities and Exchange Commission has approved and authorized, under the Public Utility Holding Company Act of 1935 (the "Act"), the organization and conduct of business af NAESCO as a wholly owned ()
l O service company subsidiary of Nortneaat Utilities, a public utility holding company registered under the Act; and WHEREAS, pursuant to a Managing Agent Operating Agreement between the Participants and NAESCO (" Managing Agent Operating Agreement"), NAESCO will assume responsibility for managing, operating and maintaining the Seabrook Project as of the " Time of Effectiveness" (as hereinafter defined in Article 15 hereof); and WHEREAS, NAESCO is willing to perform the responsibilities of the Disbursing Agent under the Disbursing Agent Agreement at cost, in accordance with Section 2.10 thereof; and O WHEREAS, economies, increased efficiencies and other benefits will accrue to the Participants as a result of NAESCO rendering the services provided for in the Disbursing Agent Agreement; and WHEREAS, pursuant to Section 3 of the Disbursing Agent Agreement, Participants owning at least 62 percent of the Ownership Shares in the Seabrook Project have agreed to remove Yankee Atomic Electric Company (" Yankee") as Disbursing Agent, and Yankee has been given twenty-one (21) days' prioi written notice of that removal; and O
A V WHEREAS, pursuant to Section 3 of the Agreement, Participants owning at least 62 percent of the Ownership Shares in the Seabrook Project have agreed to appoint NAESCO Disbursing Agent, as evidenced by the July 19, 1990 Agreement between Northeast Utilities Service Company acting on behalf of NAESCO, and certain Participants owning 70.60921 percent of the Ownership Shares in the Seabrook Project: NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the Participants and NAESCO agree to amend the Disbarsing Agent Agreement as follows. () 1. The reference to " Yankee Atomic Electric Company (" Yankee" or " Disbursing Agent")" in the first paragraph of the Agreement is changed to " North Atlantic Energy Service Company ("NAESCO" or " Disbursing Agent")".
- 2. All references to " Yankee" subsequent to the first paragraph of the Agreement are changed to "NAESCO."
- 3. The reference in subparagraph (1) of Section 1.3 to the " Nuclear Support Services Agreement between Yankee and PSNH (as agent for the Participants), effective as of July 1, 1983" is changed to the " Managing Agent Operating Agreement,"
O l,
4 p.
- 1
\/
- 4. The definition of " Project Manager" in Section 1.6 is deleted and replaced with the following: " Project Manager means North Atlantic Energy Service Company unless and until a successor has received all necessary licenses and authorization to replace North Atlantic Energy Service Company and has replaced North Atlantic Energy Service Company as Project Manager l 1
of the Seabrook Project." l I
- 5. The fourth sentence of Section 2.6 is hereby deleted.
l l 1 1
- 6. In the second line of Section 2.12, delete "PSNH or l other" and insert "the" before "T rcject Manager". At the end of t}
( ,f Section 2.12, insert "or the Man,.ain,; Agent Operating Agreement. "
- 7. The final two sentences of Section 2.9 are deleted and replaced with the following:
Each Participant shall have the unrestricted right to all financial records relating to the Seabrook project within the control of the Disbursing Agent, and its affiliates, wherever located, except fo. information which is a) protected by law, b) restricted by contract with third parties, or c) deemed commercially sensitive by an affi~11 ate or affiliates of the Disbursing Agent. If requested financial records are restricted by
l
/~'y. ; ^~. J l contract with third parties, the Disbursing Agent, and- l its affiliates,.will use their best efforts to obtain the consent of third parties to disclose confidential financial records to Participants, with the understanding that Participants may be required to sign j l
a non-disclosure agreement, for financial records I l which are considered commercially sensitive to, (an) l affiliate (s) of the Disbursing Agent, upon the request i of one or more Participants, such affiliate shall allow for their review by an independent third party, selected by the parties involv 6 (other than the Disbursing Agent and its affiliates) and acceptable to G ( J- the' Disbursing Agent (provided that the Disbursing 1 Agent may not unreasonably withhold its acceptance) to determine, using an informal, simplified procedure,
'whether the financial records in question are commercially sensitive. In any event, if reasonable under the' circumstances, the Disbursing Agent may l
require a Participant to sign a non-disclosure agreement covering financial records that it considers commercially sensitive. L Review of financial-records at the offices of the-
'Dishursing Agent, or its affiliate companies, shall occur at reasonable times during normal business hours,
() -
4 O and shall be arranged in advance among the involved parties. The Participants shall use reasonable efforts to avoid disrupting the business operations of the Disbursing Agent or its affiliates. The Disbursing Agent shall coordinate and facilitate the dissemination of financial records between Seabrook Station and the Executive Committee and/or the Participants. / Subject to the limitations set forth elsewhere in this Section 2.9, any financial records relating to the i
\ project shall be provided to any Participant requesting them, with the understanding that t'.e Participant may be required to pay for the cost of providing them in the circumstances described in Section 2.13.
Without limiting the generality sf this Section 2.9, any Participant or the Executive Committee may request an audit of the accounts and records of the Disbursing Agent,. at its offices, at reasonable times, by an independent certified accountant or other representative of the Participant requesting the audits ( provided that, absent extraordinary circumstances, r subject to the rights of the Participants-under Section
" - - - - - - - - - _ - - - . _ _ ~ . . _ _ . _ _ _ _ _ _ _ _ _ _ _ _,
4 p l O : 18 (Arbitration) of the Managing Agent Operating Agreement, a ful.t-scope audit shall not be performed at
.the request of the Executive Committee or one or more Participants not affiliated with the Disbursing Agent more frequently than once each year. -If an audit is requested by the Executive committee, the costs thereof
" shall be borne by all Participants in proportion to their Ownership Shares. Il an audit is requested by , one or-more, but l'ess than all, of-the Participants, the costs thereof shall.be borne by the Participant (s) H making such_ request. If an audit is performed in ; connection with an arbitration proceeding, the costa of i the audit shull be allocated among-the Participants in accordance with the-decision of the arbitrator.-- ; 8 '. - Section 2.10 is-amended'to read as follows: 2.10 Payments.. All services rendered by the- ; Disbursing. Agent, or its-affiliates, under this Agreement ! = shall-be at-actual cost thereof,' fairly and equitably != allocated-and calculated, all' consistent with the requirements of the Act and the rules and regulations and-n ~ orders' thereunder. .-Direct' charges will~be made for services u
-where a direct allocation of cost is possible._ Charges not O
y l
.._,.-,_..._.._,_.s__.,.u;_,_.~.a.,.__ _ . _ _ _ . _ _ . _ _ _ _ _ . = _ _ _ _ _ . _ _ . . ._
o v directly assignable shall be determined and allocated on a reasonable and equitable basis in accordance with the Act and as approved by the Executive Committee, which approval l shall not be unreasonably withheld. The Disburring Agent shall obtain Executive Committee approval, which approval shall not be unreasonably withheld, of the methodology utilized, as well as changes thereto, for allocating costs to Seabrook Station prior to the implementation of such metnodology. Such allocation methods will be appropriately documented and available for review by the Participants upon request. Without limiting the generality of the foregoing, allocable costs include executive salaries and fringe () benefits paid by the Disbursing Agent, the empicyee wages and benefits paid by the Disbursing Ager.t, the-insurance expenses incurred by the Disbursing Agent and other general overhead expenses incurred by the Disbursing Agent. The Disbursing Agent shall keep complete and' accurate accounts of all receipts and expenditures hereunder in accordanc;< with the rules and regulations of the Securitiee and Exchange Commission and the Uniform System of Accounts prescribed for Public Utilities and Licensees, subject to Lthe provisions of the rederal Power Act as amended from time to ti'ine (or such similar accounts as may hereafter become appropriate) (hereinafter the " Uniform System of Accounts").
.d(\
9 O
- 9. The following is inserted after Section 2.12, and Sections 2.13, 2.14 and 2.15 are renumbered as 2.14, 2.15 and 2.16, respectively:
2.13 Technical Assistance. Upon request, the Disbursing Agent shall assist the Participants in regulatory proceedings and other contested matters relative to the Plant, including the provision of witnesses and of current and accurate data on a timely basis. Information, including witness support, that will require a substantial commitment of time or a substan*ial effort to assemble or develop, and is neither a) required by a substantial number of Participants, not b) requested by the Executive Comnittee, shall be paid for by the Participant (s) requesting such information. The Disbursing Agent, in consultation with the Executive Committee, shall develop a reasonable standard by which it will determine how and when a Participant is to be charged for information requested.
- 10. All of Section 4.1 following the first two sentences thereof is deleted and replaced with the following:
For and in consideration of the fact that NAESCO is undertaking responsibility under this Agreement for O
and on behalf of the Participants without any compensation or charge othei than recovery of its costs for such service, no Participant shall be entitled to recover from NAESCO or the directors, trustees, officers, employees, agents or affiliates of NAESCO (or the directors, trustees, officers, employees or agents of such affiliates) (collectively, " Protected Parties") eny damages resulting from performance or non-perfctnance of its respective responsibilities hereunder or under the Joint Ovnership Agreement, or for any damage to the Seabrook Project, any curta11 ment
~s of power, or anylother damages of any kind, including
(- / direct, incidental, consequential, special, indirect or punitive damages occurring during the course of the design, engineering, procurement, installment, construction, operation, maintenance, refueling or decommissioning of the Seabrook project or otherwise arising out of the performance or non-performance of this Agreement, unless such damages shall have resulted directly from the wilful misconduct of NAESCO, or, to the extent legally attributable to NAESCO, directly from the wilful misconduct of a Protected Party. Notwithstanding the aoove, no Participant shall be entitled to recover any such damages if such damages g- result from NAESCO's or a Protected Party's actions or
\
O omissions that have been expressly approved by the Executive Committee or by the Participants. All goods and services provided to the Seabrook Project by a Protected Party shall be under a written contract having the same limitation of liability as above; provided, however, that the same limitation of liability shall ulso apply even if goods at.. services are provided without a written contract. The provisions of this Section 4.1 shall apply notwithstanding any provision of this Agreement to the contrary and shall survive the expiration or termination of this Agreement. NAESCO shall not have any duty to use its own fundt in carrying out its responsibilities under this Agreement.
- 11. In the first line of Section 4.2, the phrase "Notwithstanding the provisions of Section 4.1 of this Agreement," should be inserted prior to the beginning of the first sentence.
- 12. A new Section 5.12 is added, reading as follows:
5.12 Contracts with Affiliates. NAESCO may retain or appoint a service company or agent (which service company or agent shall be affiliated with NAESCO) to act on its behalf O l
(D LJ and perform the responsibilitie and assume the duties of the Disbursing Agent hereunder and under the Joint Ownership Agreement, so long as such appointment is consistent with the terms of the operating License and the rules and regulation of the NRC. No such retention or appointment I shall become effective unless the agreement (s) between 1 NAESCO and such service company or agent (s) has been approved by at least three or more unaffiliated i Participants, ownirig collectively 60 percent or more of the Ownership Shares. Participants shall not withhold their approval of any such agreement if it is fair and equitable to all affected parties. Any service company or agent (s) / h (,) which perform services under this section shall, unless the Executive Committee otherwise directs, submit bills for such services to NAESCO, and NAESCO shall in turn bill the Participants for such services.
- 13. The address in Section 5.11 is changed to 107 Selden Street, Berlin, Connecticut 06037.
- 14. A new Section 5.13 is added, reading as follows:
5.13 Termination. This Agreement shall be subject to termination and shall terminate, without any action by NAESCO or the Participants, to the extent and from the time /,_h %J
. 1
% l that performance may conflict with the Public Utility Holding Company Act of 1935 or with any rule, regulation or order of the Securities and Exchange Commission before or after the making hereof.
- 15. This Amendment shall become effective at the " Time of l Effectiveness." As used herein, " Time of Effectiveness" shall mean 11:59 a.m. on the last day of the calendar month in which l all federal, state or local regulatory, judicial or other l l
approvals necessary for the performance of the Managing Agent Operating Agreement between NAESCO and the Participants shall have become effective. FURTHERMORE, NAESCO accepts the appointment as the Disbursing Agent pursuant to Section 3 of the Disbursing Agent Agreement. IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be duly signed by an authorized officer and attested (or such signature by an authorized officer to be attested to by
~
l a witness) on the date indicated but as of the date first above written. 1 CANAL ELECTRIC COMPANY By
Title:
THE CONNECTICUT LIGHT AND POWER ' COMPANY By
Title:
EUA POWER CORPORATION By
Title:
/] C HUDSON LIGHT & POWER DEPARTMENT By
Title:
MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY By
Title:
MONTAUP ELECTRIC COMPANY By
Title:
NEW ENGLAND POWER COMPANY By , A _Q Title l-
t 15-O NEW HAMPSHIRE ELECTRIC COOPERATIVE By
Title:
NORTH ATLANTIC ENERGY SERVICE COMPANY By
Title:
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE, DEBTOR AND DEBTOR IN. POSSESSION By
Title:
[ TAUNTON MUNICIPAL LIGHTING PLANT By
Title:
THE UNITED ILLUMINATING COMPANY By Title VERMONT ELECTRIC GENERATION AND TRANSMISSION COOPERATIVE, INC. By Title
/
.r, - ., . -
..,-.y----, q m-
ESH2 BIT B.3 (Conpetite Copy) 2/01/P0 AGREEMENT TOR J0!RT CVNERSHIP, CONSTRUCTION AVD (A)\> OPERATION Or NEV KAMPSHIF,E NUCLEAR UNITS Dated: May 1, 1973 i As Amended: May 24, 1974 (Tirst) June 21, 1974 ($econd) September 25, 1974 (Third) October 25, 1974 (Tourth) January 31, 1975 (Tifth) April 16, 1979 (Sixth April 16, 1979 (Seventh, not effective) April 25, 1979 (Eighth) June 8,1979 (Ninth)- j October 11, 1979 (Tenth) i December 15, 1979 (Eleventh) l June 16, 1980 (Twelfth) December 31, 1960 (Thirteenth) May 25, 1982 (Tourteenth) April 27, 1984 (Tifteenth) June 15, 1984(Sixteenth) March 8, 1965 (Seventeenth) March 14, 1986 (Eighteenth) May 1, 1986 (Nineteenth) (5g September 19, 1986 (Twentieth) (_,/ November 12, 1987 (Twenty *Tirst) January 13,1989 (Twenty-Second) - Parties Public-Service Company of New Hampshire The United 111usimating Company Montaup Electric Company EUA Power Corporation New England Power Company 7 Canal Electric Company i The Connecticut Light and Power Company New Hampshire Electric Cooperative, Inc. Town of Hudeon. Massachusetts Light and Power Department Vermont Electric Generation and Transmission Cooperative, Inc. Massachusetts Municipal Vholesale Electric Company Taunton Municipal Lighting Plant Commission Notet In text that follows the wording which appears between these asterisks (***) is that addition made by the amendment noted in the margin. l*%
-- - ---,n .g e n p..--- + e , , , - --n-, , ~ ~ <++-- - ,,
!EtX fN Persstaph ve, subiset pige 1 Description of the Units 2 2 Designation of the Site 2 3 Participation in the Units )
4 Conveyance of Property *; 3 Waivot of Partition .; 6 Relationship of Participants '3 7 Envirotsmental Oeudies L. 8 Design and Construction of the Units ;. 16 9 Execution of Contracts 10 Insurance and tiability of Participants if Payment of Capital Costs Incurred 21 11 12 Operation and Maintenance of the Units 27
^ 13 Payment of Opersti:n end Maintenance Expensest
;6 +
q Inventories and fuel 13A Decemntssioning Costs and Ponent s 33 14 Right to Audit 37 15 Entitlements 38 16 Dispatch' of Units 38 17 Transsission of Power 38 18 Agreements . Delay in Cossnercial Operation Date 39 19 Destruction, Damage, or Condemnation of Units 40 20 other Uses of tha Site 42 21 Approvals of Regulatory Agencies 44 Conveyance of Security Interests or in Trust 44 22 23 Rights to Trans for of ownership Shares 45 55 24 gggggpension, $butdove of Resumption 0
- -. - , - . - , . . e - , - -- - -. ---
O O the Units. It is agreed as fe,11ows :
- . 1. Oascrintion of the " nits na Units shall be tvo nuclear fueled steam electric ger.orat.
ing units each of approximately 1130 W net capability and will include the main power trans former or trans forzars and those switching station f acilities and connecting cables which are installed at the Site in connection with the two units. The first Unit shall initially be scheduled to couemence commercial operation on or about Hovember 1,1979, and the Second Unit on or about November 1,1981; provided, however, that PSNE reserves the right to revise the schedules from time to time to reflect actual progress in design, engineera ing, licensing, procurement, and construction. In ordar to meet the scheduled 1979 and 1941 comnertial operating dates, PSWE presently intends to proceed V with A8C license preparation pending receipt of the New Kampshire siting certificates hwever, PSNE reserves the right to revise the schedules to reflect a P$NE decision, based on developments in its New Hampshire siting proceeding, to suspend or delay AEC license preparation pending receipt of the New Hampshire siting certificate.
- 2. Desianation of the Site The Units will be constructed at either the Seabrook site or the 1.itchfield site, as determined by PSNE. Such determination vill be made not later than the tias at which the last license or permit required to enable consancement of construction of the Units is obtained on terms satisfactory to PSNE.
The Seabrook site is located vesterly of Hampton Marbor in seabrook, Hampton, and Hampton Falls, New Eagshire, and the Litchfield site
,,-c.- . . - - , w - , , , , . ,
o 3 O is located on the auterly side of the Merri.,ack River in '.itchfield, New Haerp s hir e .
- 3. Perttetsstion in the t'ntes
'3.1 Subject to change in accordance with the provisitns of this Agreement, the Units and the Property Interests as defined in pera.
graph 4.1 of this Agreement will be owned jointly, as tenants in ccanon with undivided interests, by the original Ps.rticipants in the fo11cving proportions: PSNH $0.0000!,
\t1 20.0000 CHP 2.3303 CLAP 11.9776 Pitchburg .1716 Mentauf 1.N64 New isdford 1.3539 NIPC0 8.9430
'ItiC0 3.0970 Total 100.0000%
Nothing herein shall be deamed to restrict the right of PSNR or VI to make capacity anchange arrangements os an ownership basis with other Participants which will reduce their Ownership Shares and increase the Ownership Shares of such other Participants. In accordance with the Preliminary Agreement, the original Participants agree to makea 'vailable to the Additional Participants portions of their interests, as set ferth in paragraphs 3.2 3.6 below. The proportions in which the Participants shall own the Units and be entitled to their capacity and output, as from time to time established under this Agressant, are herein referred to as the "Cvnarship Share" or " Ownership $ hares". O
I Over tr.e Ad .st.en* Tert:is 't: iefine: te;;v , .e 1 0.nership Share of ?!NX sht;; te rets:et tr.1 'i; tr.e P.nersni; !+.st,s ' lang:r , OMP , Muds:n , 'O NIO ":nt tup , 33 tr.1 *tur.t:n ne re !r. ::; .e :t ; ..,;y referred i: as tr.e " nitia; Trar.sferees") sta;l te .r.:ressed ty .. :;.!*.
..... .....f
....,.,, , ;. . . . . r . , . . .....a.
4.. 3..., r., t,
,., res;e.. .... . , sn ;
...3..... ....
(ii) the ;vt. erst.ip Share :f es:n ;trty vni:r. sha.'. to:::e an A:ii*.; r.t. l . Transferee as provided in :*.tuse el hert:f sha'.. te ir.:resses :; tr.e j .e . percentage Ovnership $htre ;ecified by su:h ;triy ;ursuant i said
- ltuse (e) lthe !nitial *rst.sferees and Additi:nti *ransferees tetr.g nere;r.
referred to as the "Trar.sferees" tr.1 the ;er:er.tage in:resse :f eten Transferee teing herein referred to as its "New Ovnership Share"), as f:ll:vs t
H t ) That ;crti:n of amounts incurred while :te :r ::re Adjustment Periods are in ef fect f:r costs of the '.* nits whi:h veuld te appli:stle to the Ovnership Share of iS:TH in the atten:e of this pr:visi;n shall be for all purteses of the Agreer.ent deemed t;;11:st'.e to the Ovner.
ship 3 hares of the Transferees f:r which such Adjustment Peri:ds are then in effect in the proportion that the New Ovnership Share of enth su:n th
.~ e r. .
Transferee tears to the aggregate New Ovnership Shares Of all Transferees for Vhich Adjustment Periods are then in effe:tn pr vided, h:vever, inst if, ! at any time while the Adjustment Perieds of Steger, OMP, Tit:hturg, Mads:n. Mot.itup and NB e,re in effect, the Adjustment Period of 20fa*EC is not in effect, the portion of tscunts in:urred for such c:sts wht:h shall te deemed applicable to the Ovnership Shares of the stove.r.tmed Transferees shall be computed to though the Adjustment Periods of MM'a'IC and 7tur. ten were in effect.
'May be slightly more er ;ess, as specified ty written neti:e by '2GIO :
PSNH.
O st. i T:r ;ur;;ses :f tr.is ;r:visi:n. tne ter:s "::st" :r s..: ant inv:!:et *.: tr.e 7 trit:!;&nts, ex:e;t
"::sts" shall in:Lude *.r.e that in the :sse of 75"M "::st" sta'.; te tr.e tif ferer.:e :etween tr.e t.:.r.ts inv:i:et to the Parti:!;tnis and tr.e t:tt; Lt.:unt :n yht:h su:n inv:i:ts are itset. Oh til :sses, "::sts" sntl'. :e ::nstieret i: :s t;;'.i:t:.e :
a Parti:if att's Svnstsni; Ihtte re<trt'.ess :f vteiner itynent :( r.e ;s.. l vei:e has teen reteived by ?!"X snt sta'.; r.:t in:'.ute tr.y 7trti:i;tr.:'s til: van:e f:r funds used during ::nstru:st:n :r tr,y equivs'.ent there:r :r i interest, if any, ; tid by 'OSTO ;ursuant : :'.suse (f) te':v. . The Adjust.ent Peri:t :r Adjust:ent Peri:ts in effe:t 18 to any Transferee shall to the ;eri:1 tr ;eriods leginning with the Iffe:. *2 tive Otte with res;ect to each :!ev ?vnership Share of such Transferee and ;e ending on the earlier of (1) in the :sse of a Transferee having ancther Ovnership thtre, when that Share has ir.:ressed ty the Encant Of its ::ev Ovnership Share, er (ii) in the :sse of each other Transferee, when su:h transferee's Ovnership Share is equal to its New Ovnership Share, er (iii) termination of the Project. If the Iffective Otte of the Adjustment Fert:d of New Mt=pshire Electric C:c;erative, ;n:. (NH Cc:p) has not accurred ty January 1,1981, NH Cocp cr PSNH thy at any time thereafter, ty vritten neti:e to NH 0:cp or PSNH, as the esse ety te, ter=inate the pr:peset acquisition of NH Coop's Nov ?vnership Share, in vnich :sse XH Ocep shti. have no further rights er obligations with respect to such New Ovnership Share. Such terminati:n shall net affect the other acquisitions cente:p'. stet herein. PSXH shall promptly notify the Partici;&nts and other Transferees of such termination. The Effective Otte with respect to the New Ovnership 3'., Shares of Banger, CMP, Pitehturg, Mudsen, Menttup and :T3 shall to January t 1981.
. . f*
t"
\ S ub,' e: :: :;s.se 'f te':v. . tr.e Iffettive :ste vit, respect to the !!ev Ovnership fr.are :f :- !.T: s r.a:.:. t e t h e '. a s t t ay : f t . e .
l s nth in which !0faTO shall receive an a;;reval :t tr.e t'assa:husetts :epart. I
.ent of Patti: 'Jttitties :f the financing ty : fat :f the a:;.isiti:n :f
. f, su:h : lev M.ership thare ' ':?! Order). ,
The Iffe:tive :ste with respect :: the llev ;vterst;; ;
- I Share of Taunt:n shall to the last day :f the : nth in vnt:n ; aunt:n ana.; i have received the last Of the a;;rova;s Of the Muni:tra; :ighting F*. ant ,
i C:ratission of th City f Taur.t:n and the Taunten City ::un:1l,. :t the i i Effective Oate of the Adjust:ent Feri:d of Taunten has not :::urred ty I June 30, 1981 Taunten shall have no further rights er :bligati:ts vith respect to such : lev Ovnership Share. :!c such ter=ination shall affe:t any 13th Men ether acquisitions of itew Cvnership Shares :entemplated herein.
'O The Effective ; ate with respect to the : lev M.ershi; l v Sha.re of NH Ooop shall remain as provided in the Tenth A endment, i.e.
the last day of the =cnth in which the inst of any required regu; story a;- prevals of the type specified in Secticn 3 of the Seventh Amendment with
- respect to the acquisition by !TH Coop of its lev Cvnership Share shall have !
teen received and financing of such : lev Ovnership Share shall have teen f-accesplished. ; Appeals or other requests for review of any such reguia- i l tory approvals shall not stay the Iffective cate established in the preced - ing two paragraphs of this clause (a), unless a stay is issued by the court , I or other body to which the appeal cr request for feview is directed
'e ese(b) During any Adjustment Period, the Cvnership Share 10th of PSNH and of each of the Transferees shall to that percentage which the M and aggregate costs then applicable to such Ovnership Share under the provist:ns of this Agreement including the foregoing clause (a) is of the aggregate ecsts then so applicable to all Parti:1 pants.
i,- ,-.w--- -*.w- 9 + -- +i. sai *eem e e- m%-iawy em -.gg.,yer ve-g-ge w w.yrm er-,m.-w>s wp e-y-w,-c-q. mus e-
.~.
l
- :ne :tMitt.:n :f en:n Trstsferee :: ;ty sny s.:.nt s;ecified in the f:regCing :.t;se :t; sntu te si:je:t :: n.e ::nt;;;:n pr,. i
- edent, at the time su:h ;t ment !s requitet, that 75:IM s nt;'. nsve ie;iverei !
1 to the Trsnsfertet !
- 1 1 sn inv:i:e f:r the t .0.e.t :f a ;:n ;t. .ent ,
e ::tt, ::sts : ner.ise referring :: ;tingrt;h 1.'. sti sn:vitt s;;11:st'.e to ?!UM's share. :n vni:n *.ne Trtnsferee's pr:;:rti:n is ::.puted, and stating that tne Adjust ent Feri:1 has net :een ,
'erninnted ;ursuant to the f: ret:!ng :*.tuse (t) t l l11) a :ertif t:ste r :ther insti; tent in re::rt- 'I stle f:rm Of ?!NH ::nfir.itt the Trs.nsferee's adjusted 5~.ership Share pursuant to the ferescing cituse (b) after giving effect t: ,
M'hi the invoice s;ecified in the pre:eding sutelause (1); and (iii) such Other instru=ents. Certif t:stes, i j epinions or documents as the Transferee ety ressenably request to
}
establish or confirm its interest in the 'Jnits, the Pr0;etty Inter- , i I ests, and related rights and interests in accordance vith its ad. justed M ership Share. .
)
(d) At the time that PSNH requests frem a Transferee the first payment pursuant to the foregoing clause (t) inserted by the Tenth Amendu nt to the Agreement. PSNH shall ieliver to such Transferee necessary releases, if any, from all trustees under tend indentures to which ?!NH is a party or to which any of its assets or preterties is subject, and an opinica of counsel for PSNH in f:rm and substance satisfactory to su:h Transferee to the effect that the Agreement, as amended by the Tenth Amend-ment to the Agreement, is the valid, legal, and binding agreement of FSNK and vill be effective to entablish as to each Transferee the full legal right, free and clear of any liens or security interests of mortgages :r
,. f .
[] se:urit/ agreements :( 73NM, i: its pr:;:rti: tite ar.are :( .ne 7.its , ;r:;,r.7
. v lAterests, and reisted rignts ar.1 tr.terests it. a:::rf ar.:e with its stf ate:
Ovnership Share, in ac :rdan:e with the ;r:vist:ns :f the Agreement.
'e) A Farti:!; ant may to:: .e an Attiti:r.a!, tra .s terve vith respe:t te an increase in its Nr.ersnt; Share ty e.te:uti:n snt tenvery t: ?!!fX :f an agreenent to su:n effe:t, in the f:rm atta:r.ed as Ixnitit , t:
the ffer isted :t:ter
- 1,. :,9*), :f 7!':X vith respe:t : the 7ti*.s. s;e:1 fyits the ;er:entage Ovnershi; Share ::nstituting such in:rease. If an l
Iritial Transferee has agreed :r shall agree to a farther in:rease in its Ovnership Share, such fur *.her it.:rease shall te deemed a separate Nev :. .er. Ut! Amet ; ship Share with respect to yht h su:h Transferee shall te deemed an Atti. , tienal Transferee (and not an Initial Transferee). A,ny other public utility approved by FSNH, whether uni-cipal, ccoperative er invester.ovned, =ay tec::e an Additi:nal Transferee by I r , entering into an Agreement with PS TH to su:h effect in the form attached as i Exhibit 2 to the offer dated October 11, 1979, of ?!!(R vith respect to tne ,
" nits, s;ecifying the percentage Cvnership Share it agrees to acquire, and agreeing to beccme a party to the Agreement and entitled to all rights as l
t Parti:1 pant hereunder te the extent of its ;vnership Share.
i f) l W EC shall use its best efforts to ::mplete the ;
first issuance of securities for the financing of its New Ovnership Share fl3 th - Amen, as promptly se possible after receipt of the !CPJ Crier. PS:rH =ay, in accordance with the provisions of clause -(c){i) of Paragraph 3,1 of this Agreement, invoice WaTC for such New Cvnership Share as of the first day of the month fellowing the =enth in which the l CPU Crder is received. ?.e amount of any invoice issued to WwTC pursuant to this clause for its-New Ovnership Share, together with interest thereon frem the date of said in. -l 1 s voice to the date of payment at a rate of thirteen ;er:entum (134) per ( I \ t . v
, , ,n ,,,e-- ~ - - - ,,na-- , --y-- - m. ,.,_wa , -e,,---,v,. e,--,- g -y ,
1* l l ne rate tr.r.us .r.ti'. Mar:n 2 *. i .! *.'
. . sta ine r etfier si t he r at e e g.s; t :
at which PSNH has during *.ne pert:$ n:: rued 0: '. * : C..:vtr.:e f:r f.n:s
. sed during :ctstructi:r.. att;'. n:t te 12e ani ;tyt:".e .tti. *.ne first tusiness ity f:'.:ving re:ei;t ty 'MTO :f ine ;rt:eeds :f a.:n '.n;t;g; fi r.ane ir.g . *f. f:r say rets:n. ': fit: s n t '. '. :e .n2t'.e t: :: .; . e t s t.: 3, fit.tnting ty hne 3 0. ;} P. , : i: r.: f ort ne r it'.':1:e s s nt'.; :e ;ss.e: ;,rs..
'it} '0!.T; ing'.. :, gni ant to the se::nd senten:e :f this :;t se 'f'.
hereby is reietsed sti dia:htreed fr:n sny :t'.igati:ts trising .r. der int tr.end.thts to Paragraph 3.' ::ttt!ned in the D.irteenth A:entrett to ine l Agreement, whi:h relate to the Ad,' ult.ent Per!:d whi:h startet :n the Iffective Otte established under :ltuse (t) :f Paragraph 3 1. in:;uitt.g obligattens under the cutstandir.g invoi:es and su:h invoices shtil te nu;l and void, (iii) the Effective Otte of t%TO's : lev Ovnarship Share estat. .... 11shed in cituse (a) of Paragraph 31 shall te deer.ed tut::stittliy :tn. g., .
- elled and the Effective Otte of !%TO's !!ew Ovnership Share shall tr.ere.
Efter to the inst day of the =ct,n in wht:n !MT0 shtil receive the ;r:.
- eeds frca the first issuance of securities f:r such tiev ;vnership Share, and (iv) such portion of the New Ovnerwhip 3htte theret:fere seguired by MTC shall revert to PSimt provided, hovever, that itfaTO shall r.:t there:y be excused fr:m the obligati:n to use its test eft:rts thereafter to ::..
piste such financing in the etnner contemplated by this c'.tuse (fl.'" 3.2 rach Originsi Partici; ant abe.11 if and to the extent required by the provisiens of paragraphs 3 3 and 3.'a. enke avaliable to the Addittemal Partialpants a porties of its 0woorship $hara, as set forth in paragrapia 3.1. la such event, the Units and the Property Instraste vill be owned jotatly by the Original Participants and may Additional Participants se saquiring Owmarship $htras. l
l 3.3 The Cvnership Sharse to be made available to Mditional Participants, and the Original Puticipants' respective obligatiens to r.ake such Cvuorship Shares availabis, us set forth in Exhibit 1 attached hereto and ande a ps.rt hereof. 3.4 An Addificcal Puticipaat desiring to participate in ownership of the Units shall, on or before November 30, 1974*, become a party to this Agreement end the Transmission Agreerient identified in paragraph 17 of this Agreement by axacuting copies thereof and shall thereby acquire an Cwaarship $hase in each of the Units equal to its Cesudtmani. At the time of such executies each such Mditional Participant shall retaburse each original Participant by wht:h any portion of its Cvnership share was made available foi costs theretofore paid and incurred by such Cristaat Participant under this Agreement in axcess of such original Participant's ownership Share (as revised), including en "allevance for funds used during cerstruction" at the rate o.' rates used by such original Participant from the datte such costs vers paid or incurred to the dates of retabursement by suah Mditional Participant. Following their acquisition of ownership Sharas and reimhreement of Original Participants, such Mditional Participants shall be deemed to be Participants for all purposes of this Agreement, if an Additional Participant shall not, on or before November 30, 1974*, enter into this agreement and the transalesion Agree. meat with valid and bindtag af fact on such Mdittoast Participant, it shall
** longer have any riths to participate in the Units.
4 Ceavavance of Prenarty 4.1 Freeptly following designation of the Site la sacerdance with paragraph 2 or June 30,1974 (whichaver is inter), PSNR shall arrange
'0 ate variously changed by L ent.ents dt.ted May 2k, 197k. Septe.ber 25. 'i";
O, and October 25.197k; and ultieately extended to January 31. '.975. ty WaWer Agreement dated Oecenter 26. 1976
6;- , for and complete conveyance to the Puticipants, in their adjusted Ovnership Sharas in the Daits, of titis, in fee staple, to that portion of the Site which is dasignated by PSM as the First and second Unit lite (or to such portiens of the first and second Unit $tte so designated u have than been astuired), together with such easements, rights, and permissieu as say be rensesably required for the construction and operation of the Units, but not tactuding those required for necessary trouaission lines. All of the property to be se conveyed (tac 19 ding such portions of the Site and such easements, rights 'and permissions) us hereinaf ter referred to as the "Preporty laterests". Revever, P$1m shall rate, thority to detuu.ine activittaa on the Site so u to permit the c 61fy u as "szclusion aread for tha Ostts and any other units v b located on the $1te. If any portions of the First and 8econd Unit 8tt- . mot then been uguired, they shall later be conveyed to the Participeats who'. estuired. In desis. nattag the First and Second Vait site PSM wil? A surt.citat area to parast (with such assements, rights and permisstes.', tha use of the First and second Unit Site. for the yurposas contenaisted by this Ag#sement. la asking such euements, rights, and paraissieu available hereunder, ?$M shall taka Late asceunt, to the antent it deems prar,ticable, say special requirements of the other Participants' mortgage indentures as to bondab.e pretes1ty or etharvisa which are brought to the atteattom of PSM. The conveyense wt11 be by one or sere tadesturas of co tossacy and will be subject to any restrictions contained in the undertytag deeds and any restrictions or itaas resulting from municipal action, but free of any nortgages or attach. mente. Such conveyance shall be by instruments warranting only against defects in title based on any actions by Preporties, Inc., or P$n during I their respective periods of ownership. Each Participant shall have the right to review the tittaa to the Property Interests. Upon notice by any O l V l l l
d
- i. 2 F6tticipaat to P$5 that there is any defect in the titles to the lud compristrg the first and Second Unit Site, cr any lien or encubruce with respect thereto, which, in the reasonsbie opinion of counsel for such Participant, vould prevent said land or any Laprovements thereto from being used as a basis for the issuuce of securities by a ath Participant F$W shall use its best efforts in cooperation with such Ferticipant ud at the expense of such Fatticipant to ettu.inate or cure such defect, tien or encabruce.
If any such defect affects acre than one Participant, such expenses shall be shar$4 by them in proportion to their Cvnership $ hares. In no event, havover. < shall any such defect lien or encumbrance permit any Participant to delay or reduce payment of its Ovnership $ hare of the price payable for the Property Interasts. 4.2 !! deemed necessary by P5W, appropriate easements in the First and Second Unit Site shall be provided to PSM for transmission f acilittee by reservation in the coeveyance to Participants. 4.3 in consideraties for its ovaarship share of the Property i Interests each Participant shall upon delivery of the instrument conveying title thereto pay to PSW, Properties, Inc., and/or UI, as directed by Fl!W, such Participaat's Ovnership Share of that portion of the total $tte acquisition costa to PIM, Properties, Inc., and/or VI to the date of conveysass, including an "allovence for funds used during construction" and prePorty tasas, allocable to the Tirst and Second Vatt 81te, such total Site acquisities costs being determined in accordance with the Todaral Power Commission's Uniform System of Accounts Prescribed for Class A and I Fubits Utt11ttes and Licensees (the Unifers System). The portion so allocable to the First and Second Unit Site shall be that porties of such total Site acquisition costs as deterr.ined by PSM which is equal to the sua of (1) the v
, . - . _ _ . - _ . . - - _ , - - _ ._ .- _..,r.. .- . . _ _ _ _
..h purchase price of the land included in the First and Second Unit $tte and (11) the enoust by which such total Site acquisition costs exceed the aggre.
gate purchase price of all the land included in the Site (the costs as of April 30, 1972, of the Seabrook site being itseLied in Exhibit 5 to the Me= liminary Agreement). Upon delivery of such instrunent of conveyance, each Participant shall also evidence full campitance with the provisions of this Agreement by paying, in addition to the amount payable under the first sentence of this paragraph 4.3, all suas than due ar.d payable which ue required to be paid by any other provisions of this Agreement or under any contract entered into by or on bahalf of each Participant in pursuance of this Agreement.
- 5. Veiver of Partition 5.1 Each Participant hereby vaives any right to partition the Units and the Property Intarosts or any part thereof (whether by partition in kind or by sale and disposition of the proceeds tharoof) so long as the Property Interests are used or usefu? for an electric generating unit, or for the tars set forth ta paragraph 31.1, whichever is less, and agrees not to cosmet.co durtag such period any action of any kind saaking any form of partition with respert thereto whethat pursuant to a remedy at common law or under any statute and vaivse the benefit of all lave and decisions, cow or hereafter seasted or decided authorising such partition. The indenture of co. tenancy and each other' deed or instrur.ent conveying any title or right to emy Ferticipent shall contata na axpress waiver et any right to partition plus the other provisions of thie Agreement or such og them as, in the opinion
- of counsel for F3115, should appropriately be recorded in the Re61stry of Deeds.
- 4. Relaticsshin of Particisants 6.1 ne obligations of the Participants are several and not jotat. Amy tatest to create by this Agreement or by any great, lasse or r
g license related harete an association, joint venture, trust or partnership er to layese se any Participant trust or partnership rights or obligations is awprasely segatived. Except as arpressly provided herein, no Participact shall have by virtue of this Agreement or of any such grut, lease or license the ri6ht e2 povu' to bind any other Participant without its erpress written consent. 7, Igggmtsi Studies 7.1 Cartain environmental studias have been either cowpieted or commenced by PfitE. Dese not yet cogisted shall be coupleted and ?$n may undartake such additional enviremmental studias as it desas necessary or destrable in ceanection with the siting or design of the Units or the soeurias of any apprevals therefer. B. lesign and 7:nstruetten Of the Units ,/~ " ' 9 .1 PS'm shall have sole responsiti'.ity f:r, and is fully l ( authorized to act for the other Part :1; ants with respect to, and shall I i determine the design, engineering, precurement, installati n and al, ther ! aspects of the construction of, the Units and of any modif t:stions er addi. tiens at any time made to the Units, except as the Parti:1; ants shall :ther. vise agree, all in accordance with " Prudent Utility Pra:ti:e". As used herein, the term " Prudent Utility Practi:e" shall at a particular time .ean gi,t'a any of the practices, cethods and acts which, in the exercise of reasonat'.e , judgment in the light of the facts kncvn to PStm at the t!=e the decision vas made, could have been expected to scac=plish the desired result at a reasonable cost conesstent with li:ensing and regulatory censideratiens, environment.L1 consideratiens, reliability, safety and expedition and taking into account the interests of all Parti:1; ants. In deter =ining whether any ' practice, method er act is in a:: rdance with Prudent Utility Practice, due p (
..;t. /~~ :*ner u;e:*.s t
( ::nstiersti:n sr.al' te given :: t r.e i n:*
- r t
- M te sign tr.
- f ::nstructi:n of nu '.ear e'.e:tri: dentrating .r.its inv:.ve tr., s;;;i: sit:..
- f sdvancing technoi:gy tr.d are sut'ett : :ntnging terna::ry sng er.vir:n.
l Truder.t Uti'.ity Prt:ti:e is n:t inter.det t: te 'i.i;et
.entti require-ents.
' ~' ' *d d
to tr.e :;ti c5 ;rt:ti:e. ett:d :r s:t . to the ex:..si:n ;f G. :tr.ers , rather to to a s;e:tru of ; s sit'.e ;rt:ti:es . .ett:ds :r s: s ;r.:;.:ir.g lt is ex;e:ted these involving the use Of nev ::r.:e;ts :r te:nnel:gy.'** Electri: ::;tny vi'.; that the h:letr Servi:es ivision :f Yankee At:r.1: previde engineering and ::nstru:ti:n su;ervisi:n. that tr.e tr:r.ite:t.engir.ver
*n: . , nr.d t r.at Vestir.gr. se I'.e:tri:
vill te United Engineers and ::nstru:::rs. a Corporation will supply the nuclear stems supply systen and f abrication of I The Participsats l initint fuel loading and of several regions of reload fuel. l shall share risks of employee negligence and other risks of construction in accordamse with their respective ownership Shares. During the process of destga and constructies of the Units or of any modifications or additions 4 therste, F915 shall furnish reports, at least quarterly, to all Participants with respost to prograss of the project, shall provide each Participant at othat tians with such other information reitting thereto as such Participant reasosahiy may tree ties to time request, and shall endeavor to advisa all Participeate concorsing any design decistoss which will have a significant adversa effest upea the cost of power free the Units, or upon their reliabtitty It is recognised by the or availability, W to consider respenste thereto. Participeats that requests and considerattom of responses as aforesaid -usast set be alleved to delay work os the Units to such an antent as to create a esterial adverse effect on the cost of the Units or the timetable for thei completies and that psitt will have sole discretion in making design and cosstruattes desisions, O
,d+
- p. f.necutien of_ Contracts 9.1 The contracts covering design, enginsaries and constructica earvicas and major compomants of the Units and all other contracts relating to procureaant, operation end matstanance of the Units, including contracts for the purchase of estarials, equipment, fuel, or services for the Units s' hall be necuted by P$n acting for itself und as agent on bahalf et each of the Participants, shall provide for several and not joint liabt14ty in '
)
proportion to the Participants' respective Cvnership Shares and may provide for separata invoicing to the Participants in accortlance with their Cwnership
)
Sharest provided, however, that at the request of P$n, any Fr.tticipant shall, es its ows bahalf, asecute any of such contracts; and provided further, that the fire er firme responsi%1e for the entiaeertag and secstructies of the Units may be authettaed by P5Wu to sigt ecutracts as agnat for all Participants. Whether or not a contract is entered into in the nama of all ferticipants, ensk Participant shall be soverally and not jointly responstMe for its ownership share of all enouuts that are payable under or with respect to the contraat , No seutract cotatmaptated by this paragraph ah811 provide for retantion of title by a supplidt to property parshased for the Units after the dell'v ery of the preparty at the $tte. It is uderstood that Mn has prior to the date hereof esecuted is its own name certata contracto relating to the Units, ine19 ding without limitation contracts with Westinghouse 21actric Cor. poraties for the purahase of two nucicar steen supply systems and for nuclear fuel fahrtsstion, and each Participant by its asecuties hereof agrees ac the tequest of NW to sacept tu writing assigamaats free 'ttn of Anterests in such contraata preportional to such Participaar,'s Ownership $ hate, whereupon such Participant eksil be severally and not jointly responsible for its ownership Share of all emeugas payable unser or with tospect to such contracts.
- 10. Insurance and tiahility of Pstr13}J,ggg, 10.1 ?$n is autho.Laod to obtata and stintato, and shall obtata sad maintain on behalf of all Participants, policias cf Liability l
.;r.
l nad propern tasuranca vitt respect to ownership of the property laterests and the construction, ovnership, operatton, and estatenance of the Units which shall af ford pretea ton agtit> t the insurable Loserds and risks as ;o which the owners of untts of tailar stre and type tustemar11y zaintsin insurance, unisse PSNH to, unaMe to obtain, or to obtain Jn reasonable terms, any such insurance er unless Participants having Ovnership Shares atstesating at least 6Cf% agtst thts any such besard or risk (other than that of nuctaar liab111ty; J shall not be insured. Such coverage shall include, to the amtsat avst; hle, nuclear itability inAurance from NELIA or MAKLU, or both, in auch f n sac g such amount as v111 most the financial pratection requirteents of ' he Atomic Energy Act of 1954, as amended, and an agteaunt of indenstificatiot se con. templated by lection U 0 ot said Act. In the event that the nuclear liantlity protectica system contemplated by said section 170 is reposted or chnged, PSUh shall oVais and maintata, to the amtmat sva11aMe on reasonaale torney alternate protection against nuclear itsbtitty. ,
***PSNX or any successor managing agent appointed under O
Pseagraph 36.2 is further specifically authorized, subjec': to the direction i of the Executive C9mmittee, to obtain and maintain surety bonds, insurance r or othat forms of assurance to (stfotd protection from itability et exisnse I ;9th Amend. ' in thq event that one or more of the Participants fail to pay o\1 or any portion of their respective share or thares of Decommissioning financing Fund payuente pursuant to Pnragraph 13A. All costs of any such surety bond premiums, insurance p umiums,oe similar forms of assurance shall be part of the expenses of operating and maintaining the Units borne by the Participants and shall include any exc(se taxes paid or incurtad in connection with the papent of such costs.*** It is recoyLined that the ammount of proporry insurance available to the sessrating usLite in a nualear electric generating etation may (as it now is) be subject to an overall site Itaitattes ard that \f so, PIER may be usabis to obtain all on the proporry Lasurenta covsrage vLch
.,t.
wwld otherwise be required by this paragraph. If, as a result of such coverage limitation, the enount of insurance proceeds received on a less simitaneously affecting one of the Units sad one or wre other units or et.her pro', arty as the lite is less than the aggregate omtunt of the insurole loss, tW insurance proceeds shall be allocated aeong the units or other preparty Af hated in proportion to the gross investments therein. If the [ insursace prossede allocated (or restlocated) to any unit or other property in this manner are iA utess of the tasurable loss sustained as to it, such ascase shall be taellousted in the some manner among the other units or ' property af fected. Ir. the event Pi!ME determinas that att or a porties of the property insurance for the Units should be provided through a sutual insurance cougaay orgaatsed by electric utt11 ties or othatvtse, it may, F foltertas consultation vtW the other Ps.rttaipants, require all Participants to became nonbers of such cr/new, subject to their obtatatas neesssary regulatory approvsts, h< ***1t is re;h nited that in Order to meet appliable a regulatory requirements it may be neAvry trem time to time to cM ain policies of liability and prop % cy dam m insurance and excess property I insurance from one or mor', insurers. M h r % tet to such policies. PSSH I or the managing ageat appointed under Paragraph 36.2 is specifically , authorized to execute and deliver on rehalf of the Participants all 13th applications and other documents relating thereto. 'Jith respect to the ; Amend. l @ 5econdary Pinancial Protection Policy required by the Nuclear Regulatory (, a.i:ssion pursuant to the Price-Anderson Act, as amended through March 14 I 1986, PSNH or any successor managing agent appointed under Paratraph 36.2 is specifically authorized, notwithstanding any provisions to the contrary in Paragraphs 9 or 10 or any other Paragraph of this Agreement whicn
provide authort.,e c, ?H:H to executa eith . Lnit s t tens :nt r a:*. s n t ne c j,m . - part of Participa.its, en execute and deliver on behalf of the Parti:1: ants with3ut restriction any Bond in connection with the Certificate of Insuran:e6 relating thereto. Notwithstanding any delegstten of responsibilities pursuant to Paragraph 36 which may have occurred. PS!.'H or the manating agent appointed under Paragraph 36.2. when see:if t:al'.v autnortzed bv vote of the Executiv, ,cmmittee, shall have the autherttv to obtain and maintain in its name ans policy of insurance frsm a mutual insurer for tne of all Parti: :an:s, protection of the Prope rty Interests snc. ':r the benefit
....e . . .e-
..; an a. .nc a r . .e. . ..s . .. . .
(;*.!' "J. :' s . ' .: 0 6
-;eJ$13'w. 11' .? a r t !: ' .:.'s
. snJ. ; " 4J : 4*
l policies. Without derogatind from the authority granted by the third preceding sentence, any payments (inelvaing without limitation any premiums, reserve premiums or retrospective premiums) required by such I policies or Bond shall constitute an operating expense of the Units of l'3th (7
- Mand.
which each Participant is obligated vis-a-vis the other Participants to l pay its ownership Share pursuant to Paragraph 13, the respective portions of such premiums to be paid by each Pa ticipant, promptly after receipt for of notification, to the insurer or to PSW or such managing agent payment to the insurer in accordance with the payment provisions of the respective insurance policies. If any Participant pays less than its Ownership Share . such payments, it shall indemnify and make whole, any other Farticipant who as a result has paid more than its ownership Share of such paymencs.*** The premdust for the property insurense obtained pursuant herste sha11 hs allocated asses all et the units covered on the hssis of the'- groes invesements in the units. g
1 In the event any porties 'asursace contas. l jrf plated by this paragraph cannot be obtained, 6 v ..wu be obtained on reasonable toute, written notice of such fact shall be given to all ! Part i:i;o.nt e . PSKH shai . keep the :ther Parti:1; ants int:rted as i: the l i status of incurtnee in f r:e. Any Parti:1; ant ty request additi:nti i r.s u r - r ; tr.:e to the extent avai;st;e. ar.d ?!!TH sht'; pur:tsse su:h requested i..surst:e A, st the expense of su:n Psrti:i;ar.t. S.e pr ceeds fr:s su:h requested insur-sn=e snail te liabursed ts tire::t! ty su:n ?titi:i;tr. .'" Each in urance policy obtained pursuant to this paragraph shall name to the artent of their insurable interests all Participants as insureds, each to the same effect as if separately insured, and shall, if a Participat so requasts, include as insureds mortgagees and others holding a security intarost in such Participant's undivided interest in the Units; and certificates of insurance for all such policies shall be provided to each Participant upon request. P5te shall have authority on behalf of all Participants to settle say lose covered by any policy of insurance obtalaad pursuant to this ;arsgrsph. "*?SNR shall notify the other Participants :f any Ju:n 1:ss , and before astering into eat such prohsed settlemsst, shall sotify the other Participeats of such proposed settlement, and shall, to the excest sufficient time is available, provide the other Participants with an opportunity to comment; provided, however, that such right to comment shall not be allowed A en te, delay say settlement or to affect the sole discretion of PSEE in asking su:b settlemcat."' 10.2 .Amy uninsured loss, damage, or liability and any aspenses arising out of any suah loss, dessage, or liability shall be borne by ti.e
. Partisipeats is assordace with their Ownership Sharse, (N
O
*03 h r and in ::n6iteratiin of the it:t that ?n/ ;;rs. ar,;
4 to this Agreenent is undertaking to tesign, engineer, pr::ure, insta'.1, construct, operate and salatain the Units for and cu behalf of itself and the 5U
. .e other Participants as their respective interests appear without any compensation or charge other than ',he recovery of PS;5'n actual costs and ex;enses f:r su:h servi:e, r.o Farti:1; ant shall te entir.ei t: re:: eer fr: .
PSNI for any damages resulting from error or delay in the design, engineering, procurement, installation, or construction of either of the Units, or for any damage thereto, any curtailment of power, or any other damages of any kind, including consequential damages occurring during the course of the desigs, engineering, procurem6nt, installation, construction, operation, or mainte-nasce of the Units or otheavise arising out of the perforr.ance of this Agreement, unless such damagw shall have resulted from a deliberate violation of this Agreement occurring pursuant to authortred corporate action by PSNH.
- 11. Payment of Capital Costs Incurred 11.1 Upon axacution of this Agreement each original Participant shall reimburse PS)5 sad UI such Ortstual Ps:lticipant's ownership Share of the total amount shown in Coluna (C) of Exhibit 2 to this Agreement, said amount being the sum of (a) the costs for the period prior to May 1,1972 shown in Exhibit 4 to the Preliminary Agreement plus (b) the costs for the period May 1, 1972 through April 30, 1973.
Each Participant shall thereafter promotly after recetyt of invoices from PSNE, which al.all be submitted by PSNE aonthly, pay to PSWA its ovmorship Share of any amounts incurred by PSNE additional to those reimbursed ta accordance with the inmediately precedtag paragraph, whether incurred prior to the date of this Agremnant or thereaf ter, for all direct and indirect costs (other than those covarad by paragraph 4.3) associated with the design and construction of the Units, including but met limited to costs incurred pursuant to paragraphs 7, 3,10, or 21, or for similar costs incurred by PSNI at any time during the lives of the 4
Units u a result of modifications or additions to the Units, including any costs of removal and reflecting any salvage. Costs for which the Participants
\
are liable pursuant to this paragraph 11 shall be determined in accordance with the Uniforn Systas and shall include all direct and incirect costs reasonably incurred by or on behalf of PSNE with respect to the Units or either of them which are properly chargeable to capital accounts under the Uniform System (or such similar accounts as may haraatter become appropriate) in connection with the design, engineering, procurement, installation, construction, insuring, and licensing of the Units or either of them. Such costs will also include costs incurred by PSE in improving and developing the Site as requi'ed for the Units. Each Participant further agrees, with respect to. l l all contracts for engineering and construction services and components of the Units as to which the Participants are separately invoiced for their Ovuor. ! ship Shares by the contrastor or manufacturer, to pay promptly all such invoices properly rendared. Each Participant shall make available to PSNI upea PSM's request the Participant's Ownership $ hare of such amounts as PSHE any readosably request in order to enable PSNI to make timely payments I l for costs covered by this paragraph without the necessity of use by PSNI of I
- its own Mda to cover other Participants' ownarship Shares of such paysants.
Amy amount.remainias unpata after 15 daye follovf ag the receipt of invoices or requests under this paragraph shall bear inte. test thereon from the date of invetee or request at as annual rate of 27. over the lowest interest rate than betas charged by The First National Bank of Boston on 90. day cosmeercial loans t provided that any Participant which agrees to pay the additicnal I 5 c.. I azpense, if any, whiak may be caused to PSNI by its request, may require PSNE Asen I to furnish invoices and requeste for funda co it 15 days in aivansa of the sahedule followed by PSNI as to other Participants. A Participant which i I ( l I
23 4 requasu that involcss and requasts for funds be so turnished to it 13 days e..
;$eri, La adysaae shall not be obligated to pay interest in accordance with the preceding sentence untaas it f ails to pay an invoice within 30 days of its receipt thereof, or f ails to provide funda so requested within 30 days of receipt cf the repest."' S.ere shall te in:hded in the :csts ::vered by thi.
l paragraph enounts equal to the costs of ownership to PSXR and VI (including but not limited to capital costs, includiet related franchiss and income taxes; property taxes; and insurance) of that portion of the $tte which is not within the First and Second Unit Site as designated in accordance with paragraph 4.1, which enounts (a) for the period prior to operation of the First Unit shall be all of said costs of ownersnip and (b) for the period beginning with operation of the First Unit and prior to operation of the Second Unit sha11 be one. half of said costs of ownership.
"*As part of the quarterly reporting procedure required by paragraph 8, PtEE shall prepara and provide to each other Participant a cash flow estimate showing by quarters projected construction costs to be shared by the Participants under this Agreement throughout the construction period of the Units. Such cash flow naimate shall be reviewed semiarvally and revised as necessary, and copies of eay such revision shall be furni.shed Participants with the next progress report fursished pursuant to paragraph 8.
At the beginning of each calendar year or as soon thereaf ter as is practicable throughout the duration of this Agreement, PSNE shall provide sach other participant with a sehedule showing by month the projected costs to be shared by Participants during such calendar year. 3 roughout the construction period of the Unita, such schedule shall be revised for the remainder of the calendar year at approximately mid fear. In addition, each monthly invoice to one of the other Participants throughout the e.onstruction period shall include, in addition to the information provided for in the preceding O l
I i l paragraph, a estimate of the enounts of projected construction costs to be ! shared by Participeats during the two months fellowtag the one for which the j O. l U invoice is submitted. All schedules and estimates provided for in this 3:.n
* * "' d '
paragraph shall be for informational purposes only, and any inaccuracias or i errors therein shall in no way relieve any of the other Participants from I I the obligation to pay promptly all invoices rendered in accordance with the l l provisions of this Agre===nt. u' + t t
" .l.2 'dithin :t .:re han 20 days after re:si;t :t a re pest j t
fr m TS:."d, eser. Of the f:';;
. vin 6 ?*r*i:!7 ant 8 Vill n1ke an Sivan:e Fa7~8.-
{
~
- vard the ::sts Of the '.' nits lin additi:n to the ner:al ::nthly par.ents I
,. .. e ,' .,
.ade by such Parti:1; ant), :f the s.:unt set f:rth :;;esite its na:e te'.:V i I
1 i y lvni:h shall te the sacant s;ecified in the request l: ? d ne . United :l'.=inating 0:=;any $ 3,:00,:00
.l'. ,7 7
! anger Hydro-Electric C:m;any Central Maine Pever Co:pany ~65,150 Central Vermont Public Service Corporation 339,130 Fitchburg Gas and Electric Light 0::;any 5'.
. 50 Hudson Light and Pever Oepartment 5,256 Maine Public Service ccmpany ' 38,' 6B (A)
Massachusetts Municipal '4helesale Electric C =pany 1,635,924 i Montaup Diectric C =pany 5*l,920 Nev Bedford Gas and Edison Light Cc=pany LO6,170 W.
- rev En61and Power Company 3,033,090
"'aunton Municipal Lighting Plant 30,102 isen <
Vermont Electric Power Cc=pany, Inc. 19 **0 ; 310,o27,917 The advance payments shall be credited against costs of the Un.its applicable to the Ovnership Share of such Participant and invoiced or a rued to it l '. i n ', commencing *** the earlier of (i) January 1.- 1981, or (ii) the Effective
r?
l A: ends Cate with respect to the New Ovnership She.res of the Initial Transferees
~
x/ specified in paragraph 3.l(a) of the Agreement '" or on such earlier date as PSNH shall specify by written nott:e to each such Participant; _x_/ nis dr.te was first changed to July 1, '.980 by the Eleventh Amen:L ent which also provided "except thst in the ease of The United Illu=inat-ing Company said January 1, 1960, date shall not be changed and the advance payments of ""he United Illuminating C mpany shall be credited against costs of the Units applicable to its "vnership Share and p invoiced or accrued to it ec==encing January '.. :980." _(] L
c . provided,-h:vever, that if ::r.stru:ti:n :f the Units is sus;ented Or 7x l terminated ;rior :: "' the earlier :t '!) January '., ;)fl. :r :11) the ... (J , , . .
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Iffective late with rispe:t to the :Tev Ovi,ership Shares of the :r.itia; Transferees specified in ;tragraph 3.;'s) :f the Agreement *** , su:n , I
- redit shall ::: ence as of the date Of su:h sus;ensi:n :r terminati:n, Su:h :redit sha*.'. te in the 1 :unt :f the advante payter. ;*us ir. seres-at the ra;e s;e:ified in ;aragra;n *.1.. :t the Agreemen f t: , tr.e inte :r the advan:e payment to the date :f su:h :redit. The a- unt :f the sivsn:e
?-
g.3
;ayment to te cade by es:h su:n parti:i; ant was arrived at t" culti;;ying tvi:e its Ovnership Ihare at May 31, *.? 9, ti:es 3'.!,000,000, ex:ept
; r.a t The *.'nited !*.luminating :: ;ar.y's advance -;ayment was arrived at ty /.'.-
'.)"), ti:es $'.5,;;;,;;0.***
tiplying it s ;vnersn'.; ihare at Yay 2' , .
11,3 Wi-hin n: ::re than 20 days af*er recei;* -f a rer.est f- q g
PSNH, each of the fol'.:ving Parti:1; ants vi'.; take an advance.;ayment *.:vard a a th'e costs of the Units (in addition to the normal :enthly payments ase by [ / . ' such Participant and the advance payment heretof:re made by such Parti:1-I I ! pant under paragraph 11.2), of the amount set forth opposite its name te;:v l l i (which shall be the amount specified in the. request): " I a
$ 1'1,7L7
- Sangor Hydro-Electric Cc:pany 765,;50 :.
-Central Maine Power Company l1,Qf Central Vermont Public . Service 539,130 Corporation- - 51,LSO .! l Fitchburg-Gas and Electric Light Cc=pany- 5,256 ;
Hudson Light and Power Department L38,168 1. Maine Public Service Cenpany Massachusetts Municipal.Vholesale 1,635,924 Electric Ccapany 571.920 Montaup Electric Co:pany 406,170 .) New Bedford'Cas and Edison Light Company 3,033,090 1 New England Power Co:pany 30,102 Taunton Municipal Lighting Plant '39,790
, Vermont Electric Power Cc=pany, Inc. t.
$7,627,917 .
The advance payments shall be credited, together vith the advance payments made by such Participants under paragraph 11,2, against c sts of the Units p7s i applicable to the Cvnership Share of such Parti:1; ant and invoi:ed er ! \~ 1 i
.:s..
a rued.t: i; ::n=encing :n the ear'ier :t i.i January ;
. ';il, ::
. 11-i
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2 the Effective : ate with res;ect ';c the !!vv lvnersni; ihares :t it.e nitia.' y~'). .i Transferees specified in paragraph 3.1.'a) :f -he Agreemen ;as a. ended by the Tenth A=endment to the Agree:ent); ;r:vided, h:vever, tr.a; if ::nstru:. i ti:n of the Units is suspended er terminated ;ri:r to January ', ;;31, su:n
- redit shall ::::en:e as :f the date :t su:h sus;ensi:n :r terminati:n, I2:h i su:h :redit sha'..' te in :ne at:un :f :he stvan:e ;aymen: ;;.s interes: 1:
the rate s;e:ified in ;aragra:n 11.1 :r the Agree:ent-fr: the ast e :f ..e advance pay =ent to the date ef'su:h :retit. All advan:e ;ay=ents under
;aragraph 11.2 shal' he :redited ;ri:r :: any :f these under :nis paragra;n
.3.
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;;.k f ne.7alue f :ne Trust Istate, as hereinsfier te fines, l.
under the Collateral Trust :ndenture isted as :f July 2, ;; 9,':e:veen :ne 1 C:=pany and The Connecti:ut Sank and Trust 0 ;any, as Trustee, de:resses i p
- at any time or frc: time to time to 'ess than '.25% of the aggregate a-:un; l
rce . ( of the advance pay =ents outstanding fr:: the Participants under-;aragra;ns _, i 11.2 and 11.3, the advance payments shall be credited against ::sts Of the i Units applicable to the Ovnership Share of each such Participant and there.> after invoiced or accrued to it, until the Value of the Trust Estate equals ;
~
or' exceeds 125% of the aggregate advance . payments under paragraphs 11.2 and 11 3 not so credited.' Each such credit shall include interest en the advance ! 4 payment so credited at the rate specified in paragraph 11.1 of the Agree .ent from the date of the advance payment to the date of such credit. All advance-payments under_ paragraph 11.2 shall be credited prior to any of those under l paragraph 11 3. Such credit shall be apportioned among Participants a::ord- ' ing.to the site of the advance payment of each Participant. The ter: "Yalue i of the Trust Estate" as of any date shall mean (1) the number of pounds of U33 0 included in the Trust Estate multiplied !ar the dollar price per peund t t A
.D. ;
of 7 03 9 as que ed *.nder the :apti:n :f "Iyenange */s;;e" in ;r.e hcear Ix- ! f\O) J
- :hange ;:rporati:n's . cst re:ent.y ;ublished Y:n W.v Se::rt i: .e '. $.+sr 10:-
**estry plus (ii) the aggregate nu:ter Of 1:1* ars . , it any, ex; ended in ,e e ,-
- nr.e:tien with the enversi:n :f su:h ;:unds of *.*30 g int; *.7 4 , **
'"11. 5 :ictvithstandir.g the ;r:visi:ns :r paragraph ;;.2 :t [-
the Agreenent-to the ::r.trary, advan:e ;sr.er.:s r.ade ;ursuant neret: sha*.' te credited agains: the ::sts of the *'r.its ap;;i:able :: S t.e : c.e r - i ship 3 hares of 3ana;;r , "P , O'/?S , Tit:hturg, hds:n, 'C-30, ":nts;;, ::3. ,J ,. l aunten an:1 '/IO ::=en:ir.g :n -he ear;ier :f June ' , :.961 :: the first ^^* l 1 day of the .cnth f:ll:ving -he .: nth in whi:h :MTO shall receive the ;r:-
- eeds fr:m the first issuan:e :f se:urities to finan:e its in:reased vner-
= ship Share provided in Paragraph 3.'. Of the Agreenent and in the :ase :f l
such ::sts appli:able :: %TO :n the earlier of June 1 *.;Si r the firs business day folleving raceipt by 'CraTO of the ;receeds of su:h initisi (l' financing; provided, however, that if ::nstructi:n. cf the Units is suspended V or ter-.inated prior to such date, such credit shali ::=ence as Of the late of such suspension er terminatien. Interest at the rate specified in Para-graph 11.1 of the Agreement shall continue to a: rue en such advance pay-nents until the day of such credit."' 12, .Creration and va intenance of the Units 12.1 Subject to paragraph 16.1 vith respect to power pool - operation. PSNE shall have , sole responsibility for, and is fully authorized to act for the other Participants with respect to, operation and =sintenan:e of the Units (which shall include but not be limited to replacements , repairs Sch and fuel procurement) in accordance with '" Prudent Utility Practice (as % defined in. paragraph 8.1)"' for the benefit of all Participants, the obje:- tives being to operate the Units as efficiently, econczically and reliably as feasible. The Participants shall share risks of enployee negligence and ::her p
~P
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r a risks-of :;eration and maintenan:e in s:::rtan:e vith their resie tive !vr.er- ) ['x . . ship Shares. :n furtherance Of su:h res;:nsibility ?SNE sr.a;; se;e:t, . ire and :entrol such ;ersennel as are required, vr.!:h ;ers:nne; sr.at; te en;'.:ytes solely of ?!NH unless Othervise determined by ;!NH up n n:: :e t: .he : ner Parti:1; ants. ;S7H shall keep s'; . partiet; ants reaser.at;y int:rtei vita res-pe:t to :;erati:n and : sir.ter.an:e :f the *lr.its and ins:f ar as feasit;e
- ensistently vith the stated :t.'e:tives sha*; . ::nsult vit a s..'. Parti:!; ants with respect to a;; signitt:ar.: de:ist:ns ;ri:r to making su:n de:ini:ns e/.-
- ept 's) in emergen:y situati:ns and 't) :: the extent that su:n it:isi:ns re'ste
. to aintenance and dis;at:h :f .he Units in ace:rdance vith ine ;rt .
l visions Of a ; ver ;ce; 2g-eement, as set f:rth in paragra;h ;6.' ; ;r:vitet ,
. l l
h:vever, that such ::nsultati:n shal; n:t be a;; ved to delay v:rk :n any 'l l phase of 0;erati:n er aintenan:e :r in any vay to ".1=it the a ;e dia:reti:r. l 1 Of ?$NH in P.aking luch. decis t:ns. T: ft:111ste su:h pre:edures ea:n parti:1- ] pant shall frem ti=e to ti:e designate One pers:n and an siternate theref:r .n: l!. f-ss c 5 s shal'. represent the Parti:ipant f:r pur; ses :r su:h ::nsu;tsti:n ini re;:rt:. After the Units are placed in ::::er:ia; Operati:n, PSYH shal; furnish re;;rts at ; east quarterly to a;; Parti:1 pants with respect to the 0;erati:n and main-tenance of the Units and shall at other **=es furnish such int:r:ation re' at- .
- ing thereto as the Participants say :,.Jonably . request.
- 13. Peyment of Operaties 'and Maintasmace F.xpossas; Inventorias and Puei 13.1 The Participeats shall share in the arpensas of operat=
ing and maintaining the Units, in accordance with thair Ownership Shares. Expenses to be so shared shall include all costs and aspenses with respect to the Units reasonably incurred and properly chargeable to the Units under the Uniform System (or such sta11ar accounts as asy hereaf ter becces appropriase). Without lianittag the gaaereitty of the foregoing, such costs and aspasses shall include (i) a properly allocated portion of PSNR administrative and l g]'
\~.
1 i 1
w general expense, '*a (ii) all ;osts of ?!!rd of keept:g te::unti:6 and :tr.er tacords, of furnishing accounts, reports and other information with respect i to the Units and of audits pursuant to paragraph 14, and (iii) all costs of s.. staffing, testing, and starting up the Units which are not capitalized. Not. ;y: withstanding the foregoing, FSNE say elect to segregate, and to require the
. Farticipeats to share per capita, any portion of such costs of kamping accounting and other records, of furnishing accounts, reports and wher information and of audits , as are incurred on a per capita basis.***
13.2 Costs of capital, franchise and income taxes, and property, business, occupation end like taxes, of each Participant shall be borne entirely by such Participant, and such items, as well as depreciation, amortisatios, and allowance for funda used during construction, shall not a
)
J be deemed azpeassa of operating and maintaining the Units for the purposes of this paragraph 13, except that there shall be included as such arpenses, asusts. equal to the product of (i) the costs of ownership to PSWE and UI (in. eluding hat not limited to capital costs, including related treachtse and income taxes property, taxes and insursace) of that portion of the Site not included withis the First and Second Unit Site or occupied by any other generating unit- La operation or under construation, which costs of ownership- (a) for the period beginning with operation of the first Unit and prior to operation of the Seteed Unit shall be one. half of said costs and (b) for the period af ter operaties of the Second Unit bestas shall be all of said costs, multiplied ~ by (ii) the ratio of the actual or erpested not capabilities of the Unles to the sua of the actual or expected est capabilities of aL1 of the units is
. servise-or under construction on the Site at any tima during such period.
O
i
-M-13.3 Psn may request all Participants to asecute contracts
, for nuclear fuel or for other expenses related to the operation and mainte. names of the Units, which contracts shall provide for several and not joint liability la proportion to their Ownership $ hares and may provide for separate invoici.ng to the Participants in proportion to their Ovnership Shares, and all Participants agree to pay promptly any. such invoicas properly rendered. P$n vill submit to each Participant a monthly statement in reasonable dotati showing all costs not so invoiced separately together with additional costs incurred by PSM in purchasing sad maintaining at appropriate levels inventories of nuclear fuel (to the artent such fuel is not leased) and asterials and supplies, said invetorias being deemed at all times to be l owned by Participants in their Ownership Shares and credit for the use thereof to be appropviately applied. Such monthly statement asy also include such amount as PSM any reasonably request in order to enable PSM to make timely payments for sosts covered by this paragraph 13 without necessity of use by P45 of its own funds to cover other Participat's ownership sharas I of such payments. Eask Participant shall pay its ownerehip $ hare of such
- mostbly statement withirs fifteen' days of receipt of such statement, and my amount set forth ta such stacament (including the amount of any funds so rf ,mted to be provided) which-is not paid by the end of such fif teen day period shall bear interest from the date of such statement at an annual race of 3 over the lowest interest rate than betts sharged by The First National Bank of Beessa on 90-day commercial loans; * provided that any Participant whi:q t
agrees to pay the additional arpense, if any, which any be caused to P$n by ; i its request, any require FSME to furnish monthly stacaments to it 15 days in , adenesa of the sahedule followed by PSM as to other Participants.. A l 5th Ferticipant which requests that acathly statements be so furnished to it ;Ame 1.5 days is advemas shall not be obligated to pay interset ta asserdance with : the preceding sentence unless it fails to pay a statement withia 30 days of f
.O i . r... i, e t r o. f . . . .
-n-13.4 p5NE shall have sole responsibility for, and ts fully authorised to act for the other participants with respect to, the procureaant of nuclear fuel and purchasing and maintaining at appropriate levels inventories of matarials, supplies and spara parts required for the operation and maintenance of the Ucits, and with respect to arranging for the storage, transportation, dispobition and/or reprocessing of irradiated nuclear fuel and for the disposition or use of reprocessed satorial.
In discharging its responsibility and so acting with respect to the procurassent, disposition and reprocessing of nuclear fuel, PSNE shall have the authority to determine the basis on which fuel vill be to purchase or loue procured and, subject to the terms of this Agreement, uranium, plutonium or other fuel materials in sa enriched or unenriched fot,n, to arrange for the enrichment or processing of fuel materials, to arrange for fuel design and fabrication, or ,to purchase or lasse f abricated fuel, and generally to make several and not joint,long or short tern coesuitments on bahalf of eaah of the participants with respect to any phase of nuclear fuel .' procurement, disposition and reprocessing 1 '" provided, hevever, that FS:3. in fu addition to any other notice hereta required, shall keep the othat p:xticipants is.- .e t infessed, insofar as practicable, of the means by which it intends to finance austear fuel retstrements for the foreseeable future."* t!alass arrangements are nede for the leasing of nuclear fuel for the t?sita er othat special joint fumi financing arrangements are made, all such fuel, estarials, supplies and spare parts for the Units shall be demand to be owned by the Participants in their Ownership Shares. If F5N1 determines that fuel materials or nuclear fuel should be obtained on a lease basis, or that other special joint fuel financ. tag arrangements should be made, it shall have the authority to estar into such a lease or other arrangement on behalf of the Participants, containing such terne, conditions and provisione as PfWE any does appropriate, but in
-)-
- l. any event providing for several and not joint liability. Before antering into l
any such lease or other arrangement, however, PSM shall notify each of the other Participants of the action to be takan and shall provide them an opportunity to comment on it, provided that any such connent shall not affect the sole discretion of P$H to determine whether to go forward with such lease or other arrangement. If, within ten days of its receipt of such a notification or with such longer period as may be speficied by PSH in such notification, any Participant notifies P5M that it r.sy not legally participate in the lease or other arrangement without the prior approval of a regulatory body or for any other reason, such Participant shall not be obligated to participate in such arrangement so long se such disability continues, but PSM may (but shall not be required to) elects (L) to increase the percentage participation of P5W in the lease or othat arrangement by a percentage equal to such Participant's ownership $ hare in which case such Participant shall be obligated to pay, as an operating cost, to PSR sach month an amount equal to the increase in the costs to PSW [ resulting from such election; or (ii) to cause such Participant to enter into another arrangemaat for the financing of its ownership Share of the fuel, such arrangesent to be one choses by such Participant but subject to review and appraval by PSM insofar as it may conflice with or adversely affect the negotiation or implementation of the proposed lease or other arrangemant for the balance of the fuell or (iii) to require such Participant to use its best ef forts to obtata any such prior approval of a regulatory body as it may require or to take such other reasonable actica as any be necessary to permit it. to participate lagally is the arrangement; provided, that nothing herein shall be deemed to require such Participant to discharge or eliminate any security outstanding on the date of this Agreement if to do so would substantially adversely af fect such Participant. Upon the request of PSH, all Participants shall thas. selves estar into any such lease or other joint arrangement. O l.
-))-
_, ) ***13A. Decemst ra gening Costs and P avvents , in recognition of the Participants' obligattens under an l i operating license and the ar .icable statutcry requirements and regulattens of the NRC to de >cmmission the Units and in impl< aentation o' the { Participants' respective obligations containeu *
*stagraph 11.1 hereof cr enforceable under Chapter 162 F of the New hampshire Rev. sed Statutes Annotated ("SHRSA") to pay costs of such decommissioning, the Participants agree as fellowst 13A.1. PSSH or any successor managing agent appotnted pursuant to Paragraph 36.2 hereof (hereinafter in this Paragraph 13A referred to as the " Managing Agent") shall, subject to the direction of the Executive Committee, be responsible on behalf of all
Participants:
for i i 19th i making, and periodically updating, appropriate plans and cost estimates for Amene the eventual decommissioning of the Units; for establishing appropriate reserves to provide for the ultimate payment of the decommiss;cning of the Units; for administering the collectien from the Participants and the - appropriate depositing on their behalf of monthly Decommissioning Financing Fund payments, in each case consistent with applicable statutory and regulatory requirements; and for periodically providing the Participants with a written notice of Decommissioning Financing Fund payment calculations, the applicabis schedule of payments and other relevant information as to collections and the financial status of the Fund. 13A.2, Each month each Participant shall pay to the Managing Agent or as the Managing Agent directs, as part of the expenses identified in Paragraph 13 hereof, an amount equal to its ownership Snare of the . O
e 4 Dettmmissioning Finanting Fund payments for that month with respect to eath-
'ln a t .
.p--
Q The Participants understand and agree (1) that the-Oecommissioning Financing Tund may be held by th. Fund (as defined) or tts designated agent or by an andependent trust or other separate f.nd. as determined by the Oce.mattee (as defined) or, in . . atsence of such determination, in related but separate funds for each Tarticipant acccretng to its Ownership Share or as otherwise determined by the Managing Agent, (ii) that, to the extent feasible, the Decommissioning Financing Tund sha;'. satisfy the requirements for tax deductibility under Section R 6A of the !
- nternal Revenue Code of 1954, as amended. (iii) that the amount and/or -l timing of accruals to the Deccmmissioning Tinance Tund may- from time to Dih A .e n:. .
time during the term hereof be modified by the Managing Agent, subject to the direction'of the Executive Committee, consistent with the i i determinations of the Committee (as defined), if any, or to reflect changes p in the amount or timing of anticipated Decommissioning Costs, and (iv) that ! i]
\
the use of the terms " decommission" and " decommissioning" in this Paragraph encompass compliance with all requirements (other than those relating to spent nuclear fuel) of the NRC for permansat cassation of operation of a nuclear facility and any activities reasonably related thereto and all rnquirements of other governmental authorities having jurisdiction related to removal and disposal of a ll nit ind restoration of the Site. The Participants further understand that the aggregate amount . of Decommissioning Financing Fund payments made by them prior to-the connancement of decommissioning eay not be sufficient to make full payment of Decommissioning Costs of a Unit, and each Participant agrees that, l ,
%]
y
.35-
- -. -notwithstanding any xasufficiency of the Decommissiening Tinancing Tund, ::
\_J = -.
shall have a continuing obligation to pay into the Decommissioning Tinancing Tund the balance of its Ownership Share of the entire amount of ; the- Decommissioning Costs of such Unit. 13A.3. Certain terms defined in NMRSA 160 T:1!. fna e;y, without limitation, "Tund" and "Cemmittee") are used in this Parsgraph 12A with the eeanings there provided. As'used'in this Paragraph 13A: "0ecommissioning Titancing
.Tund" shall mean the Tund; and "0ec mmissioning Tinancing Fund payments" for any month. shall mean an amount e:;ual to all accruals in suth month to the Decommissioning Tinancing Tund, as f rom t:me to ti:te established by the ;
Managing' Agent in accordance with Paragraph 13A.2, to provide for the i ultimate payment of the Decommissioning Costs of a Unit. >
" Decommissioning Costs" for each Unit shall includet (1) All costs and expenses related to removal of the Unit Uh A.an: ;
from service, including without limitation, dismantling, j mothballing, removing radioactive material (excluding spent nuclear fuel) to' temporary and/or permanent storage r.ites, decontaminating, restoring and supervising.the Sito, and any costs and expensus i incurred in connection with proceedings before. 1
-governmenta1 authorit les - reloting, to' any authorization - l to decommission such Unit or remove- such Unit from service.
(2) -All costs of labor and services, whether directly or indirectly incurred,' including without limitation, O r
rm 36
?
- l 1
d
~'
services of foremen, inspectors, supervisors, surveyep. . I
)
engineers,' security personnel. counsel and accountants,
; -: , .L performed or rendered in connection with the decommissioning-of the Unit, supervising the site and removal of the Unit from service; snd all ccsts cf -{
materials, supplies, machinery, constructton equt; ent
' j and apparatus acquired or used (including rental charges f for machinery, equipment or apparatus hired) for er in !
~!
cennection with the decommissioning of the Unit and I removal of the Unit from service, and all admir.istrat;ve 3 costs, including services of counsel and financial ;;.g advisors, of any applicable independent trust or other J. .e n: separate fund established-pursuant to this Paragraph; it i being understood that any amount (exclusive of proceeds 1 y~ of insurance) realized as salvage on any machinery. .. qt,
. construction equipment and apparatus shall be treated as l
a reduction.of the amounts otherwise chargeable on account of the costs of ' decommissioning of the Unit; Li and p-(3) 'Alll overhead costs applicable to the Unit during its' s l decommissioning period, including, without limiting the-generality of the. foregoing, taxes (other than taxes on or in respect of income), charges, licenses, excises and. L assessments, casualties, surety bond premiums and insurance = premiums. o 3 .? l' ( ..
.);.
Without limiting the generality of the foregoing, any other ar.ounts expended or to be paid with respect to decommissioning of the 'lnts or removal of the Unit from service shall constitute part of the Decommissioning Costs if they are, or when paid will be, either (1)
'. h pt:;erly chargeable to any account related to dec:mmission;ng of a nuclear .e-generating unit in accordance V;th the Uniform System (or such si t'.ar accour.ts as may nereaf ter teceme appr:priate), or (ii) properly chargeat'e.
to decommissioning of a nuclear generating unit in accordance with then applicable regulations of the NRC or any other governmental authority having jurisdiction.**" 14 Risht to Audit 14.1 .. 75 3 shall keep centiate s.nd accurate acce';.t :f all recaipts and azpenditures bereunder, in accordance with the Unifora System , 5.- of Accounts prescribed for Class A and 5 Public Utilities and 1.icensees by A e-the Federal Power Cosmaission u aseended from cima to time (or such sinitar accounts sa may bareafter become appropriate).... gg ;,,, g m,gy p gg ,,,,,. . , l account to all Participants in such form as the Participants reasonably request for all arpasses incurred La the design, construction, operation, and maintenance of the Units. Any reaacnable 'equests by a Participaat for an additional accounting in a different form required by it shall also be granted to the amtsat practicable but shall be at the expense of such Participest. With reasonable frequency and not less of ten than annually, upon the reasonable request of a major.ity in interest of the Participants othat than P515. P$n shall make its accounts and records available at its officas et reasonable tiaess for examination, at the aspense of the Participants requesting the audit, by an independent certified public accountant or other representativs designated by a majority in interest of the Participants other thaa PSR requesting the audit.
- 13. Entitlesette l
l 15 . 1 rach Participant shall be entitled to its Cwsership Shue of the Lasta11ed capacity, available capacity and hourly generation of each of the Units. A.11 delivertes of power shall be made to Futicipants as..i metered at the low side of the station transformer. Each Puticipant shall be responsibh for all transformer and transmission losses incurred with respect to traasformation cad deliveries of energ7 for it beyond the l point at which the Units un metered. Subject to the restrictions on transfer of Ovnership Shares contained in paragraph 23 and to pungraph 23, any Participant shall be free to sell all or any put of its entitlements in ths Units upon such terms and to such partiss as it say choose.
- 16. Disestch of Units 16.1 The Units shall be maintained and dispatched in accord.
ance with the provisions of the New England Power Pool Agreement as in effect from tLas to time, or the provisions of such other power pool agreement as p may supersede it, so long as PSNI is a party to such Agreement. If no such agreement La 'in effect, the Units shall be maintained and dispatched in accordance with the schedule determined to be appropriate by PSN1 in its sole discretion, after consultation with the other Participants, it being the intention to meet to the extant' reasonably possible, the requiremaats and desiras of all Participants.
- 17. M etoo of Power 17.1 Arrangement for transmission of its entitlement from the Units will be the responsibility of each Participant. However, this provision shall not in say respect limit any Participat's r16 hts under the tarus of.the New England Power Pool Agreement or any power pool agreement which may supersede it.
O 1 1
17,2 Except as may otherwise be mutually agreed by the
- Participants , the, following transmission f acilities to be constructed, ovned, n
and operated by Pf15 and NI?C0 vill be deemed to be associated with both of the Units if the Units are constructed at the Seabrook site, and the fixed and operating costs related to them vill be borne by PTW, VI, and the other Participants in the Units in proportion to their Ovuorship shares in the Units: 345 KV Line, including terminal f acilities Seabrook to scobie 5/5 345 KV 1.ina, including terminal facilities Seabrook to tevkabury 345 KV 1.ine, including terminal facilities Seabrook to Newinge s ; in the event the Units are constructed at the Litchfield site, F52 vill designate the transmission facilities to be usociated with the Units and supported by all Participants. Such determination vill be consistent with any unifera policy which may than have been adopted by the NEPoot participants covering the designation of transmission facilities to be tri.ned as asso-cisted with particular ganarating units. The rights and obligations of the Participants under this paragraph 17.2 are defined and set forth in a separata agreement which shall be azacuted by each Participant contemporane-ously with its execution of this Agreement.
- 18. Aareamants Delst in Commercial Onoration Date 18.1 F5n and UI (for purposes of this paragraph, the " lead participeats" for the Units) previously signed agreements dated as of August 7, 1972, with the Isad participants for the Connecticut nuclear unit, which agree.
sants were intended to be signed also by the lead participant for the F11gris 2 Unit and to provide for (1) the sharing of additional capacity made necessary O
.0 by delay of the scheduled cc1mettial operation of either of said units or the
( f/ nits (the " Additional Capacity Agreement") ud (2) the temporary reallocation of capacity ta the event of such delay of either of said units er the Units (t% tallocatica Agreement"). Copies of the Additional Capacity Agtsament and the Reallocation Agreement have been furtished to each Participant. The Additions! Capacity Agreement e.nd the Reallocation Agtessant ars currently being revised both to reflect a new scheduled in. service date for the Pilgtta 2 Unit and to acknowledge that no Participant naking capacity available to others in accorduce with the Reallocation Agreemant should be required as a result thereof to pay a Capability Responsibility deficiency charge undar Section 9.4(d) of the NEP00L Agreement on the amount of capacity so made available and to provide that - the signatcrits to, and the other entities which become bound by, the Reallocation Agreement shall take 611 appropriate action in the NEPOCL Managemant Committee to obtain appropriate waivars of the Capability I.asponsibility deficiency charge in such circumstancas. Each Participaat understande that FSNB and UI erpect to sign the Additional Capaatty Arreement and the Esa110 cation Agreement, revised as aforesaid, and by its axecution of this Agreemant orpressly agress that upon such signing by PSNR and UI it vill be deemed bareby to have expressly assumed all the respective ob11&stion8 imposed on joint ownarship participante in the Units by, and that it vill thereupon be bound by, the Additional Capacity Agreement and the Reallocation Agreemsst, as to revised , in accorcance with the terms thereof as if such Participant had smacuted such Agreemente.
- 19. Des t ru c t i on . Dama g e , o r C ond emna t i on o f Uni t s 19.1 If eithar during a.onstruction er after coupletion of construction of either of the Units all or substantially,all of either or both of the Unite or that portion constructed shall be destroyed, damaged or condesmed, yfNR may elect to repair, restore or reconstruct such Unit or O
1 _ . __ _ - - . - - . _ - - _ - - - - - - - - - - - - - - - - - - - - " -- " ' ~ - ~ ' " ^
Units to its or their former character and use or to such character and use as PSNE say then deter 1Line to be appropriate; and, in any such caA4, each Participant shall pay its Ovnership Share of the costs thereof af ter due credit for any not salvage or insurante proceeds realised. Although the sole responsibility and authority for making any such election shall rest with P5tfE, it shall, upon request, censult with any Participant concerning the repair, restoration or reconstruction of such Unit or Units, previded. I however, that any such request or consultation shall not be allowed to delay work on repair, restoration or reconstruction of such Unit or Units or to affect the sole discretion of P5NH in making such election. 19.2 In the event that less than substantially all of either or both of the Units or that portion constructed is destroyed, damaged, or conde1med, and such destruction, damage or condesrtation does not preclude , pronrpt completion of construction or repair, restoration or reconstruction of such Unit or Units, PS!fR shall proceed with steps required to effect completion of construction or repair, restoration or reconstruction of such Unit or Units and each Participant shall pay its ownership Share of the costs thereof after due credit for any r4e talvage or insurance proceeds re:11 red, unless Participants having at least *** 51P. *** of the ownership ;1th Ar.e . . Shares elect that such completion of construction or repair, restoration or raconstruction should not be ef fected. 19.3 If under either paragraph 19.1 or paragraph 19.2 the o election is made not to repair, restore or reconstruct th'a Unit or Units , each Participant sci'. pay its ownership Share of any costs or arpeassa
.;g.
incurred by PS2 in the shutdovn, damolition or disposal of the Unit er
~
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& Units and the provisions of paragraph 24 vith respect to conveyance of the Property Interests shall be applicable.
- 20. O t h e r '.'s e s o f t h e ! s t e 20.1 Participants recogttize that units in addition to the '.' nits say be constructed and operated on other portions of the Site and that in connection therewith it may be necessary or desirable to relocate or modify some of the f acilities constructed in connection with the Units. In the event of such occurrence, PSW may, subject to the obtaining by each Participant of any necessary regulatory approvals and mortgage indanture releases (which each Participant agrees to use its best ef forts to obtain),
make such relocations and modifications provided they are accmaplished without cost to the Participants, other than P5h'R and the participants in any such additional unit, as provided in paragraph 20.2 below. It is O Q) further recognized that in the event of constructico of additional units on the Site it may be necessary or desirable to provide for joint use by the Units and one or more other units of parts of the Tirst and Second Unit Site, certain intarssts in land, and certain facilities constructed in connection with the Units such as the administration and service buildings, the cooling water' intake and discharge facilitias, the fuel handling facilities, the s tation transformer, and switching facilities. Such joint use shall be permitted, subject to the obtaining by each Participant of any necessary regulatory approvals and mortgage indenture releases (which each Participant agrees to use its best efforts to obtain), and the Participants shall execute such doctaments as may reasonably be required to accomplish such purpose, if arrangements are made to reimburse the Participants on an equitable basis for their investment ir, any facilities or land or interests l in land to be jointly used and provided such joint use is accesplished without v
-
- 43 cost to the Participants, cther than PSNH and the partictpants in any such A
() - additional unit, as provided in paragraph 20.2 below. No participant (other than PSN11 and VI) shall have any right u a result of its evnership of the Units and the Property Interests to participate.in tbs evnarship of any additional unit on the $tte, 20.2 PSNE agrees tbse if the consttuction, operation or :siste-nasce of additional units on the Sits requires relocation or nodificatien of, or ensults in an increase in the fixed, operation or saintensace costs of, the Units or results in an increase in the Participants' systen power costs because of the unavailability or reduced availability of the Vaits or either of them, neither the costs of such relocations or modifications nor such increases in fixed operation, saintenance or systen power costs shall be borne by the Participants. 20.3 In the event F$NE determines that any portion of the Property Incarests, or any interest therein, is not needed for operation-of the " nits, it say provida for the consayance of such portion to itself or to any other pure.haser for a fair and reasonsMe price and establish the terms and conditions for such ccaveysace.
- Subject to obtaining necessary regulatory approvals and sortgage 1.ndenture releases where applicable (which 5th each Participant agress to use its best efforts to obtain), each Participant A.end shall asacute and delivsr any deed or other instrument necessary to conysy, free and cisar of all 11ena and enemnbroaces other than (i) these which asisted at the time of conveyance to such Participant, (Li) liens securing taxas or other governmental charges, the payment of which is not yet ,
daltaquent, and (iii) liens and encumbrances caused by the acts or omissions of 75NE, such portf.on of the Property Interests or any interest therein determined by PSNE not to be necessary for the operation of the Units, and i i
upon such conveyuce by it each Participant shM1 receive its Ovnership p) Share of the price, less any related axpenser.... l $2 I
- 21. Artrovals _of Rer ilarerv Aranetes ,
21.1 PSNE shall proceed, ud is igily authorized to act :n behalf of all Ps.rticipante, t'J use its 'best afforts to obtaici til tpprovals or pensits fres savlatory agencies required for construct %cn and operation of the Units, and all Participa.nts thall cc:.pr6te to raasonably i'equestn in such process. Each Participant shall be reupensibla l'or securing any approvals required for its participation in the Units and for any actions required by it pursuant to applicable statutes and governmental regulations , incivAiss but not liatted to actions ander the ipvs of The State of New Rgshire in order I!or l such Participant to ctrry on such activities, if any, Aa Nett Easpshire as may be required in accordance with this Agreement. j hsv 22. Cetrvevemee of Seeurity fecerests et tn Trust 22.1 Iach #articiput shall have, without need for consant. from or prior offer to any othur Participant, the rt@t at my time and from time to time t;o convay ar,y form of security interest including ,1 nortgage of, or to convey to a trustaa or trustees as securi*y for its present o1 futurs bends or obligations or secutities, Les ownership Share of the Property Interests and the Units. a"My such conveyance sb.e.11 be subject to all tne , terms ud cond.itions of this Agres= ant, except that agreements herein limit-ing the aJacunt of, er neans of deter =ining, the consideration to be paid to
- .y a Participant for its righ^, title and intes'est in any property conveyed by Q it or on its behalf purnua.ut to para 6raphs 19,3, 20.1, 20 3, 2L.5 er 25 2(1) of thia (4reemen's shall not be contro11?ng in determining such property's va.iue ter hay purposes of qv nortgage indentu,re er other security instru=ent to which it is subject."* Subject to such terms and conditions, any such
trustee er trustees, t.:rtsStee si t.01:er :! a st:21ty int erest , tr.y a .::::::: er assign itsroof, and ar.y receiver or trustee in tar.krupt:y, rettsst.1:ati:n
- r receiverabip of a Parti:1;ar.t r.ay, vithout need f:r : r.sent :t ar.y ::ner Parti:1; ant, succeed to ar.d 1:p1Te all rights of 1 Pettiti;ar.t ;;.rs.5.; :
1.*.t e Agraet:ent. ::: su:h :enveytt.se ; err.itted by this Jr.rtgra;h sta'.' in.:' .. 'ee . an interest 13 :nly :ne er the '.'r.its :r different it.teresta in the yttst . r.; t ar.1 the See:nd '.' nit; ;r:vited, h:vaver, snat this senten:e shai . r.tt te i I dee:ad u prehibit a Parti:ipant's :yestien of F. security interest in ;ar. tt:ular nulear fuel.
- 23. R,,tpt s to tr ans f e r o f Ovneys hio Sh ares 23.1 Exce.et as contaarletsd by paragraph 3 and as prcnidad in this paragraph and paragraphs 22 and 23, so f articicant shall seit er trans fer any portion of its Oenership Shame of the (faits or the Property tati ro ns.
Subject to :he proviciens of paragraph 32.3, any Participant m.sy at any time sell all or any perties of its Ovnership $hste of the Propety Interests ud the Units to any antity which is eigaged in the electrit utility business in New tagland 'w; no svth sale shall be made unless P5N't and U1 have (ast' to the event -(i) of an raf fer of sale by either PSNR or Ut to which the other does not respond with an of fer to purchase or (ii) of an offar of sais by a Participant other thaa PSND or UI to which neithor PSN1 nor UI responds with an of fer to purchase, then all other 7articipants) have first bean af forded-in writtag an opportunity to purchase the interast involved separatuly er in the aggregate esa equal or better terms than those of the offer of side and have declined tuch op;4rtuity. *n*Any writing t9 Partiettants pursua.nt to ' this pa/tagraph shall specify the istarsat offered, the propcsed ter=s sad conditions of the so.le, and the dste not less than eight months Pcm the , t.. dnte of the vriting vhen it is proposed to consu= ate the sa?.e. Tailure - Q by s.ny Participant within two months of the date of the 4Titing u respor.1
e-
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in vritir.g with t.n :ffer 10 ; a:N o the in erest inv:1 vet sha;; te tee: : g .,
~: . . .
a %ci!nitaair's of the :f fer Of sde by su:h Ferti:1; ant,"' :n t.,e ,v er.: u.at (1) toth / if1f afd "I fail to :ff er t: ;;r: nase :r :11: either ps:,t.: :
.\.
t '!' e f t art to s'sil and .no ther f ails to :f fer to ;urthose ud such u :f f er !r u
,3 of sete results ta offers by acre than one ?articipant to purthue the ints:sss tuuh interest shall be apportioned in accordance with the Ownership
[U ! Shuss of the Participants =Aking offers or in such other manner as the purchuing Puticipants agree. In the event sa offer of sais results in [ offers by both P$NE and VI to purchase the interuti such interest shall be opporttooed berveen them in accordance with their respective 'Nnership ,k Shues, or in sue.h other maar u ther may agree. E Pir.uly st may
"' truster all or ; art of its Cvrership State er uy right to acquire an increased cr rev,tsed Cvntrahip Sharo (a) to a vto*~1b cued subsidisry; :r g 5 (b) to anothsr ec=puy it tne same WK cc:.;uy system or a ted.ru:ti:n AA" .f trust er similar L. thy frr the benefit tr o.s trt,'s ferer Or estther ::=7uy 3
in the same holdi:g ci.:pty aynes "' trovidad, %t trattars by V?* C0 d shall be permitted eniv as set r:Ith '.elev in this ;tragraph 23 \; cc ( .) u in :entaction with a merger, censolidatien :r acquisitten of tubstantially all of the propertise cr su of tha generating facilittee of a Pucicipat; f t and Wit.0 may, prior to Coptember 30,1974,' trans fer to Central Vermont h Public 'J77/Gs Corporation a portion of VEZo's ownership Share equal to 1.797F. M/or to Crema W.rustain Power Corporation a portion of WLC0's ownership Share-i equal to 1.16737., cabject in each case to the obligation of any assignee to naka available to the Additional Participants, in the same mannae as WLCO is obiilstad t6 to becounder, a portion of its ownership Share equel to the ra'cio of its Owns.rahip Share to the original ownership Share of VEMO (3.09707.) emittp1 tad by tha Ownarship Share which VELCO vould have bcan obligated to
'Date extendeA to September 30,197L by Second A=end:ent dated June 21, *. 97 ,
E 9
make availa,ble to the Additional Puticipasta hereunder as set forth ta - f.shibit 1 attuhod hereto; and either P$NE or U1 may, prior to the tima of i trusfer of title La ucorduce with ps.rsgraph 4,1 bereef, tratafer a portien ; n
;V of its Ovsersaip $ hare as put of a capacity anchaags on sa usership buts with j i
usther Participant. Neither say creasier permitted by the preceding sentence, j ter any trar.a fer conterplated by puagraph 3.2, paragraph 22, or paragraph 23 I hereof, shall be subject to the foregot'.g right of refusal. A,ny trus ter of any portion of an Cvnership shara shall be made expressly subject to all proirisions of this A6teament. No such conveyance parsisted by thir puagraph ! i shall inolve se interest in only one of the Udts or differsat interest.: in j t.he Fitst Unit ud the Secend Unit. !
*** 23.2 Notwithstanding the provisions of 23.1 but subject !
to the provisions of paragraph 32.5, any Participant say sell all or any l portion of its Cvnership Share in particular nuclear fuel provided that h Uth W such Participant makes arrangements to lease the fuel share so sold, that Mend. j l the terms of such sale and lesse arrangements do not adversely affect t b ; ( - rights and intereste of the other Participants in such particulst nuclear fuel and in its use and financing in accordance with this Agressent, and that such terms are satisf actory to PSNet. *"
***23.3 Tor purposes of Paragraph 23 of this Agre uent cnly. 3 the following teres, when capitalized but not othervise, shall have the ic11owing meanings *
- ?th (a) " Departing Participants" means Bangor Hydro Electric eend.
Company ("!KE"), Central Maine Power Corepany (" CMP"), Central Vermont Public Service Corporation ("CVPS"), f Titchburg Gas & Electric Light Company ("Pitchburg") and Maine Public Service Company ("MPSC"). " Departing Participant" means any one of BHE CMP, CVPS, Pitchburg or MPSC. t
'I t
.a$.
(b) "!VA" freats Eastern Utilatiss Assectates. , (c) "EVA Pover" means IVA Power Corporation. (d) "Purthose and Sale Agreenents" means: (1) that tertain purchase and sale agreerrent by and between BRE sad IVA dated as of Pobruary 19, 1986, as arrended and l supplerrented by a :ertain addendum by and tet.een IF.E. EUA and EUA Power dated as of June 30, 1946, re; sting to 1 2HE's sale of its Ownership Interest to EUA Poveri l (it) that certain purchase and sale agreement by and between CMP and EUA dated as of Tebruary 19, 1946, as 4 amended and supplettented by a certain addendum ty and between CMP, EVA and IVA Power dated as of June 23, 1966, relatirig to CMP's sale of its Cvnership Interest ! tn EUA Power; (iii) that certain purchast ad sale ' 00th A.,e ng . l l agreement by and between CVPS and EVA dated as of : , (Q> Pebruary 19, 1986, as amended and supplemented by a l i certain addendum by and between CVPS, EUA and EVA Pcwer dated as of June 23, 1966 relating to CYPS's sale of its Cunership Interest to EVA Power; (iv) that certain purchase and sale agreercent by and between Titchburg and EUA dated as of April 8, 1986, as amended and supplemented by a certain addendus by and between Titchbtra, EUA and EUA Power dated as of June 30, 1986, L relating to Titchburg's sale of its Cvnership Interest l to EUA Power; and (v) that certain purchase and sale agu ccent by and between MPSC and EUA dated as of l April 7, 1986, as amended and supplemented by a certain '.~ addendus by and between MPSC, EUA and EVA Power dated as } l_ l v
of June 26, 1986, relating to MP$C's sale of its ' cvnership Interest to l','A Power. " Purchase and isle Agreenent" means any one of the Purensse and Sale Agreetents. (e) " Remaining Participants" means the Participants other than EUA Power and the Oeparting Participants. (f) " Costs of Carmilatten" eeans any and all obligati:ns, whether :entractual, statutory or otherwise, relating to, arising out of, connected with or in anticipatien :( the cancellation, termination or shutdevn (for an ' extended period or pernanently) of either or both of the Units (including without limitation removal, relocatien.
-demolition, distcantling or storage, or any cczbinatten thereof, of structures, or the restoration and rehabilitation of the physical and aesthetic appearance of the Site) accruing to the Participants as a direct Mth D A end.
( result of either or both of the Units being cancelled, terminated or shudove for an extended period or permanently (including without limitation any costs , payable in accordance with contracts executed under Paragraph 9 of this Agreement). Por the purposes of'the ; foregoing sentence only, shutdown for an extended period
.1 shall be deemed to have occurred (i) in the case of Unit 2 upon closing of the transactions contemplated by any Purchase and Sale Agneesent, and (11) in the case of Unit 1, if the Participants by appropriate action under Paragraph 24.1 of this Agreement decido that Unit 1 shall be shut down for an extended period.
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-30 2 3 . !.
Upon clcsing cf the transacticas centeeplated ty ar.y Purchase and Sale Agreement, this Agreesent shall be dened amended withcut any further action by the Participants to (1) delete the Oeparting Participant party to such Purchase and Sale Agreement as a Partacipant and party to this Agreement, and (ii) substitute EUA Power in such Oepart:r.g Participant's stead. 23.5 Upon closing of the transacticns centeeplated by ar.y Purchase and Sale Agreement, the Oeparting Participant party to su:h Purchase and Sale Agreement (and its officers, directors, employees, affiliates and the officers, directors and employees of its affiliates) shall be deemed released, discharged and excused by the Remaining ! l I l Participants and all other Departing Participants without any further l action by them of and from (a) any and all contractual obligations of ary
' 20th kind whatsoever to be performed af ter such clesing arising from, relatey / e r.d .
to, or connected with the ownership, construction or cperation o' the
,m Units, including without ' limitation these arising under or relf, ed to J 1
(1) this Agreement, (11)-the Transmission Support Agreement by and ascng the Participants dated May 1, 1973, as amended from time to stue, (iii) any and all resolutions adopted by the Partit:1 pants with respect '.o the ownership, cunctruction or operation of the Units (to tra e4 tent, if any, of obligations arising thereunder), (iv) any other agreement among the ; Participants created in pursuance of this Agreseet.- the Transmission Support Agressent, the aforesaid resolution? cf the ownership, construction or operation of the Units, and (v) any and all contracts, agreements or other undertakings arising from transactions between the Participants or anyone acting on their behalf, on the one hand, and other persons, corporations, fires or entities of any nature, on the other hand, created in pursuance of the ownership, construction or operation of the Units, and _ O
,a- - ,+ , - , . . - - , - , , . . , . , , , , , - . . . - , . , , , - .- ,
(b) **e any 7,,, ) and all obligations, whether contractual (including without limitaticn bb under Paragraph 13A of this Agreement as added by the Nineteenth Atendment to this Agressent dated as of May 1, ;986 (the " Nineteenth Amendment") with , respect to "0eccmmissioning Costs" as defined therein), statutory or l cther.ise, relating to, arising out of, ccnnected with cr in antitipation of the decctmissioning, conversion or cancellatien of all or any portien of either or both of the Units, including without lititstion (i) removal, relocation, shipsent, containment, demolition, dismantling or storage or any combination thereof of any radioactive equipment, saterials, nuclear vastes or contaminated structures, (ii)' storage of radioactive debris, and ; (iii) restoration and rehabilitation of the physical and aesthetic appear u ce of the Site. l 23.6 Upon closing of the transactions contemplated by any f Purchase and Sale Agreesent, the Remaining Participants and the Departing , Participants not party to such Purchase and Sale Agreement (and their 00th ( A:end. officers, directors, eeployees, affiliates and the officers, directors and esployees of their affiliates) shall be dented released, discharged and excused by the Departing Participant party to such Purchase and Solo Agreement without any further action by it of and from any and all obligations of the kind described in clauses (a) and (b) of Paragraph 23.5 of this Agreement. 33.7 Notwithstanding the generality of Paragraphs 23.5 and 2La of this Agreement, the closing of the transactions contemplated by any , Purchase and Sale Agressent shall not operate to release (1) any rights of ( contribution or indamnification that the Participsete would, but for Paragraphs 23.5 and 23.6 of this Agreement, have against each other 1 I (whether under this Agreement, any other agreeseot or statute, at law or in O . O v ,4 ,,-,g. ,. , ,-, ,-,---,w-, , , - , , , , ,,e-,,-e ne,,-,--,,.,n,- ,, . .,,. , , - , ,,-_e~ < , - -w w-r er
J equity) reisting te any claim of any persen, corporation. firm er entity of ' l sny cature (etter than a Participant) based upon any actaenable act, emission er breach of contract occurring prior to such closing, or (11) the , ebligattens (if any) of CMP, I E or Titchburg under that certain " Agreement to Share Certain Cents Associa'ed with the Tewksbury.$eabrock Transmissten Lane" dated as of May 8. 1986. I 03 8
"* "The coligati:na Of EUA Fower to pay its snare cf Osectmissioning C:sts ano 0:sts of Cancellation are secured by a separate fund of $10 million ("EUA Power rund"),
which has been established under, and is subject to the terms and previsions et, a Cecenmissioning Costs Security Agreement dated !! vemoer !6, 1986. The several ebligatiens of the Osparting Participants which existed under Paragraph 23.8 of this Agreement prior to the Twenty-Second Amendment to pay up to an aggregate of $10 million of Decommissioning Costs 22j p ..-d i Costs of Cancellatten after exhaustion of the EUA Power Tund are hereby released, discharged and excused upon the offactive date of the Twenty-Second Amendment. On and after the effective date of the Twenty-Second Amendment to this Agreement, EUA Fever sna11 deposit into the EUA Fewer rund, promptly upon receipt thereof, suen amounts, if any, as may ce paid in cash to EUA Power en account f claims asserted by EUA Power against United Engineers and Constructors, Inc., which clains have besn assigned to EUA Power by the Departing , Participants under the aforesaid settlement Agreement. The amount to be so deposited shall be the cash paid to EUA Power in ~ settlement of said claims or as a result of a final i I
ludy: tent enteres upon ht&gata n er arcitrat&:n Of said ' clains lasr (1) $1 millien and (ii) EUA Nwer's payments of 22rd l A e:4. inder.nificatien and c:ntribution under Section 3 of said Settlee.ent Agree.ent." *" 23.9 Net.ithstanding the previsiens of Paragraphs 23.. and 32,3 of this Agree-ent, the Partteipants hereby c:nsent to the sale and transfer to IVA Fower by the Departing Participants of their respective Ownership Shares, and harkby irrevocably vaive and release any and all rights of first refusal er other rights to purchase such Ownership Shares 2;th
;.end.
(and any and all written notice requirercents with respect thereto) under this Agreement er ctherwise, arising by reason of the proposal or censue.satten of such sales and transfus to EVA Power, all in ordu that such sales and transfers to IVA Power may be censumated and carried into sflect.*** 1 LL.1.2 "Notwithstanding any g Other provision to the centrary in this Agreement ;
- rt.
er in the Acyd. Agreement for Seabrcok Propect Disbursing Agent dated May 13, 1984, as amended to the date hereof (the " Disbursing Agreement"), PSNH, pursuant to the terms providing therefor
/
in this Agreement and in the Disbursing. Agreement (but not sub$0ct to Paragraph 33.1 of this Agreement), shall pay or cause to be paid with respect to the Seabrook Projcct, in an aggregate amount not to exceed $30 million, all of the funds necessary to pay (1) MMwrc*a evnership share of the saaerook Pro 3ect costs (as defined in Paragraph 37.4 of this Agreement, but excluding Decommissioning costs and costs of , c i
. . _ . . _ _ , . _ - _ . . - . , ~ . _ . _ _ _ _ _ . . - _ . . . . . _ _ . . _ . _ _ . _ . _ _ _ . . _ _ _ . _ _ . _ . . . . -...-.,__:
F Cancellatien), if not paid prior to the effectivo date heroot 1 by MMWIC or CL&Pr and, also, as they tecema due en and after Oecember 1, 1988, (ii) MMWIC's evnerthip Share of preperty
)
= taxes with respect to the Seabrook Pro 3ect and (iii) MMWIC's tvnership Share of amounts due under the Transmissicn Support Agree =ent dated May 1, '973, as a: ended to the date nereof.
- ! prior to such effective date MMWIC is billed f:r MMWIC's Ovnership Share of Project Costs, which has not been paid previcusly by MMRIC or CL&P, or for MMWIC's ownership Share Of preperty taxes or amounts due under the Transmission Support Agreement, PSNH shall teimburse such party as shall have nade payment therefor, and such reimburse =ents shall be
- redited against PSNH's celigations to make payments of up to
$30 million as provided hereunder. MMWIC hereby assigns to 22nd Are n-FSNH all credits, refunds, recoveries, damages and settlements which are paid or credited to KMWIC or to which MMWIC would be entitled had MMWIC made the payments referred to in clauses ( i) , (ii) and (iii) above, and which are attributable directly and prcportionately to payments made by PSNH. :f any cash credits, refunds, recoveries, damages er settlements (collectively, the " Credits") wnien, prier to the first to occur of NEP00L Dispatch or cancellation, are paid or credited against the payments described in clauses (i), .
(ii) and (iii) above, the Credits shall not reduce PSNH's obligation to make payments up to $30 million, and shall be applied toward the next payment due for MMWIC's ovnership Share of' Project Costs. PSNH's ebligations to make the A! . . _ . _ __ _________ _ .
aferesaid payments pursuant hereto snall cease, even if the i aggregate a=ount cf $30 milli:n nas not then caen reacned, { i upon (a) NEp00L Dispatch of Seabrcok Unit No. 1 or (b) l Oancellation of Unit No.1, whichever occurs first. As used l. I in this Paragraph 23.10 and in Paragraphs 23.11, 23.12 and 23.13: "NEFCOL Oispatch" means ,he date upon which said " nit No. i receives an cperating license granted by the Nuclear j
?.egulatcry Cce. mission to cperate at more than five percent
- 51) cf " nit No. i's gener2 ting capacity and tne Unit is released to the New England Fever Exchange for dispatchi and "0ancellation" eans the time at which pursuant to due authorization the Joint Cuners cancel, abandon or cease activities leading to full power cperation of Unit No. 1 as a nuclear unit. Notwithstanding the foregoing provisions of this PP.ragraph 23.10, MMWIC shall remain fully liable as a O Participant, and shall pay its Cwnersnip Share of all Pro $ect 2 rA kNed.
Costs, property taxes and amounts owing under the Transmission Support Agreement either (i) for amounts due above the aforesaid $30 million or upon NEP00L Dispatch. whichever it earlier, or (ii) to the extent, but only to the extent before NEP00L Dispatch and before PSNH has expanded the aforesaid $30 million, of any credits received by or on behalf of MMWIC on account of the billing dispatch savings of any electric power actually taken by MMWIC frcm Seabrook Unit No. 1, erevided, that to the ettent that MMWEC does not so take such power, PSNH shall be entitled to receive such power without MMWEC thereby incurring liability except as provided i in this Paragraph 23.10." O
56-ihii "Notwithstanding any (, other provisiens to the centrary in this Agreement, if '
'\_ cancellation of Seabrook . Unit No.1 occurs prier to NEP00L Dispaten, MKWEC sna11 pay its Ownership Share of all 1 Oeccanissioning Cests (as defined in Paragraph 13A.3) and all 00sts of Cancellati n 'as defined in Paragraph ::. ff)),
including its Cwnership Share of all payments which may then become due under Paragraph 23.8 as amended by the Twenty-second Amendment, and its Cvnership Share of all property taxes and all paynents due under the Transmissien Support . Agreement, rut in an amount not exceeding $10 millien in the j sggregatar anc :n suen event FSNH sna11 pay all :f MMWEC's i Ownership Thare of (1) such Ceccmmissioning Cests and Cests l h of cancellation. (11) property taxes and (111) payments under 22 i ;ee.r.d -4. the Transmission Support Agreement to the full extent that () the aggregate of them exceeds $10 million. IT Cancellation lj occurs after NEP00L Dispatch, the preceding provisions of l this Paragraph 23.11 shall be null and void, and MMWIC shall pay its ownership Share of the foregoing ecsts." 23.12 "Whatl.or er not PSHH makes the payments which would otherwise be required of XMWEC, as proviced under P'aragraphs 23.10 and 23.11 hereof, MMWIC sna11 hhva no ebligation to make any such payment prior to (1) PSRH's full payment of $30 million, (ii) NEPOOL Dispatch or (iii) Cancellation, whichever occurs first, except to the extent of the value of any credits or benefits received by or en behalf of MMWIC en account of electric power actually taken by MMWEC. Upon the effective date of p (s l
4
*he Tven'.y-Second Amendment, MMWEC shall be deemed not to have been in default since June 1, 1988 under this Agreement, i
O the Disbursing Agreement, er the Transmission Support Agreement. The failure by FSNH to make any payment which would etherwise to required of MMWEC, as provided under Faragraphs 22.10 and ::.i; hereof, sna11 net fi) :enst;tute a l tef ault by MMWEC u*. der t.*.is Agreement. ne 01scursing Agreement er the Transmissten Support Agreement er (11) reduce er diminish the cwnership Share of MMWIC existing en June 1, 1988. However, any such failure of PSNH shall echstitute a default by FSRH under this Agreement, for which the other Participants (except MMWIC) may assert any remedy available under this Agreement, seek equitable relief or damages, er exercisa any ether right er remedy at law er in equity, including withcut limitation the reduction of PSHH's
, ( Ovnership Share."
2111 "The obligations of 22nd A end. TSNH under Paragrapns 23.10 and 23.11 to make MMWIC's paynant. to the Seabrcok Project shall be limited as provided in said Paragraphe. Neither PSKH nor any other Participant shall -have any obligation to mat . - ny additional or other , MMWEC payments, railure $y FSNH or any other Participant to make any such additional or other MMWIC payment shall neither constitute a default under this Agreement nor diminish the Ovnership Share of PSRH or of any other Participant. Failure . by KMWIC to pay its ovnership Share of Project costs, property taxes, or amounts due under the Transmission Support Agreement as required by Paragraphs 23.10 and 23.11: O Fm'pg- - **Weas--e w$r-----ew-,, ep eae*,-yw,,ww =,,n,, ,,.,,_y- - - - w 7 -=-- "=**'ra-+*v*---*-'P r'T'r-W-
~
'a) if tafere NEFCCL 0:spatch and tefore 22ncellatten, anc a:ter i3 :ays' critten nett:e nas :een
\
given :: MMWEC, sna11 entitle :ne other Participants to Octain equitacle relief er damages, r exercise any :ther right :r remedy at law er in equity, but not to reduce MMWEC's Ownership Share, ner may PSNH exercise ::s rights under Faragraph 25,2 and (b) if after Cancellatien er after NEPooL Oispatch, shall ::nstitute a default by MMWEC under this Agreement f:r vnten the c: hor Farti: pants may seek any remedies available under this Agreement (including without limitation PSNH's exercise of its rights under Paragraph 5.2), equitable relief er damages, er exercise any ether right er remedy at law er in equity, including without limitation the reduction cf MMWIC's ownership Share. Por () purposes of this subsecti:n (b), a default sna11 include e.a without limitation the failure after Cancellation er NEPCOL N$$2, Dispatch to cure a nonpsyment under subsection (a) above within coven days after Cancellation or NEP00L Dispatch. 23 11 "Except as specifically previded otherwise in Paragraphs 23.10, 23.11, 23.12 and 23.13, all of the Participants, including PSNH and MMWEC, shall remain fully liable and ebligated for their respeitava ownersnip Shares of all Seacreen Project C:sts, preparty taxe6, Oransmission Supper: Agreement payments, Costs of Cancellation and Decommissiening Cests, and all other costs and expenses as provided in this Agreement and in the Disbursing Agreement, and no Participant shall be Q V e
-__._._________.___----m._ - _ _ . - - - - --
i cbligated or bece e ebligatad to pay or assu e the E~"d* Obligations of any other Participant with respect to the Seabrook Pre]ect." ***
*** 24. Terstnatten, Suerensten, Shutdevn er s.esustrtien of C nstructien 24.1 Consttuction or operation of 'Jnit 1 tay be tertinated or suspended or shut down f or a brief or extended period or persanently, ,
or construction or operation may be resumed after suspension or shut devn , M'nd* f or a brief or extended period by written agreement of Participants evning fifty-one percent ($1%) er more of the Cvnership Shares. Each Participant I shall baar its Ovnership Share of all costs of suc'. termination, suspensier l or shutdown and of all costs result 1ng therefrom, including, in the event i of resumption of construction or operation, the costs thereof. l 24.2 Recogniting thatt (a) by a vote of th,e Participants on September 8,1983, construction of Unit 2 was reduced to the lowest feasible levelt (b) by a vote of the latticipants on March 30, 1984, it uas agreed that Unit 2 be cancelled as of December 1. 1984 subject to the 15th satisfaction of two specified conditions and that, until Dece bar 1. 1964 Amend. expenditures for Unit 2 would be furtner reduced to the level necessary to preserve and maintain Unit 2 and any existing permitt, sad approvals therefor: and (c) pursuant to PS.W action of April 19. 1984, all construc-tion of Unit 2 was suspended, construction of Unit 2 shall not be resumed without a vote of Participants owning at least fif ty-ons percent ($1%) of the Ovnership Shares. *** O
g. O 25. tefault- v Puticincts 25.1 in the event of def ault by say Participant in any obligation pursuant to this Agreement the remaining Participa.nts, or any of tham, shall be free to invoke such ressdies at Irv er in equity as my be deemed appropriate, subject to the arbitration provision set forth in paragraph 26 hereof. No def ault in the perforzuce of any obligation other thu an obligation to uke ny paysant hetsunder which the Ftrticiput zay legally uke shall be deemed to entst if such def ault is the result of an
" uncontrollable for ce". The term " uncontrollable ferce" u used herein shall mesa stors, flood, lightning, earthqua.ka, fire, explosion, f ailure of f acilities not due to 1sek of proper care or wintenance, civil disturbuco, labor disturbance, sanotage, var, national amargency, restraint by court or public authority, or other causes beyond the control of the af fected Particips.nt, O which such Participant could not reuonably have been expected to avoid by asercise of dua diligance and foresight. Any Participant af fected by an uncontrollable force shall uso due diligence to place itself in a position to fulfill its obligations hereunder ud if unble to fulfill say cbligation by reason of an uncontrollable force such Participant shall exercise due diligence to remove such disability with reasonable dispatch. ***In the event that any ' 7 4cipe.nt sh'all f ail to make when due any payment recuired i 19th by this Agreer, .
I A:end. t under any contract relating to the construction, O V
-61 cretation or n.ntenance of the Units er the su;; ort cf their associated transmission facilities entered into pursuant to this Agreerent. in additten to any other rights which may then exist and in consideration of the tutual agreements of the other Participants, each of the Participants terety agrees (1) that PSNH shall have the right in its sole discretien to take sach paynent, or the 01sburning Agent (appointej ty the Partttt;snts under a separate Agreteent dated as of May D , 1954, as aeenced, the "Distursing Agent Agreement"), shall have the right to accept funds with which to make such payment and to disburse any funds so accepted to seet obligations of the def aulting Partictrant. (ii) that, whenever such a payeent has been nade on behalf of a defaulting Particip*.nt. PSSH or the Disbursing Agent, as the case may be, are hereby authorized on behalf of all Participants to recover f ree any such def aulting Participant the secunt of such payments, heretofore or hereaf ter inade, together with interest f rom Mth 4:e nd .
the date payment by the defaulting Participant was due to the date of reistursement, and (iii) that the interest co payable by the defaulting Participant shall be at an annual rate of seven percentage points over the lowest interest rate then being charged by The First Nationc1 Bank of Besten on 90 day commercial loans or, if such rate would be deemed usurtous, at the highest rate then legally permissible. The Participants further agree that (a) if P$ht has itself made the payment, it shell rutain any such recovery together with the interest thereon, and (b) if the Disburning Agent has made such payment, all such recoveries tiall be applied as follows: the principal thereof to reimbt.rse the appropriate accounts and the interest thereon to be credited for the Ele rata benefit of all non+def aulting Participants, unless otherwise directed pursuant to the Disbursing Agent Agreement.*** O
r- 25.2 !! a default by a Participant other than P1W or VI (the "def aulting Futi 1 pant") in any obligation under this Agreenant hu etntinued f:r n:re than five n: nth "* after vritten r.:ti:e :f sa:h iefact has teen ti"en to tne tef anting 7arti:1; ant V 712.'* 71W nay, in ;iea et tr.y :ther ripas r "{ tamedies that it say have against the def aulting Participant by reuen of the default, by written notics to the def aulting Futicipant with copies to all other Participants, ternicate all rights of the defaulting Participant uder this Agreement on the date specified in such notice, which date shall not te less than thirty days af ter the giving of such notice. Vpen the effectiveness of such tersinstit , (a) The defaulting Futicipant shall cesse to have any rights in the capacity and output of the Units or any rights under this Agree. ment utept as set forth in this parsgraph 25.2. (b) Pg n shall succeed to all the defaulting Participant's rights, under all contracts, leases and other instruments relating to the Units, including this Agreementi (c) The def aulting Participant shall pay to P$n all amounts than owed by the def aulting Participant under the terms of this Agreement with interast thereon at the rate specified in paragraph 25.1, and the amount of any legal or other expenses incurred by P$W in connection with such def ault or the termination of the defaulting Participant's ri$ hts under this Agreement, and, in addition, as liquidated damages, en amount equal ti, 257, of the lasser of (1) the defautring Futicipant's not investment (as datarminad in accordance with the Uniform System, if applicable to the FeWicipant, or, if not so applicable, La a mannar consistant with the principles of the Uniform Systen) at the effectiveness of such terminati:n in the Units, the Preperty Interests and the fuel and eterating invent: ries I
2 p s f:r the *.* nit s, :r ' (ii) the then f air .trr.et n' e :f sit : eft.;;;r.g i Ftrti:1; ant's tvnership ! hare in the Units. Fr;;erty lr.terest s tr.1 sa:r. f.e' . i
.It-and inventeries (witheut giving ef fe:t to the lef t.;tir.g Parti:!;stt's ;:::
}. .e . : .
- t its rights in the ts;s:ity tr.d cutput :f the '.' nits ;;rsutr.: i: ;trtart;r.
M.J!al at:ve. !a:h 1..:ur.t :f liquitated 13..tges is agreet ty the ?tr. ti:i; ants i: te a fair tr.1 rets:r.an e n;;r:xtr.sti:r. :f tr.e siitti:tt; :t. .s g e s vni:h vi'; . resu*: to F!::M .;;r. the tren:h :t this Agree er.: ty any : ster Partiti; tnt, whi:h it. ages :str.ct -ere a:curately te deter .ined ty sty :tner
.eth:d h e : the hrsti:n :f this Agtte ent Ent the ut:ertainty vr.i:h ne:es.
sarily exists at the is'.e if this Agree ent with res;e:: : the ::sts ass::1 f stet with the Units and to :ther ;ertinent f att:rs, ::r.sitering the ;r:te:ti:n 1 aff:rded to Pf TH ty ths ;revisiens :f ;tragraph 2$.2(d) hereef. l (d) futje:t to ettaining ne:essary reguintery a;;r:va; ' and sortgese indenture releues whare spy 11 cable (vbich the defaulting 4 g Participat agress to use its best efforts to obtain prc1mptly), the defaulting Participat shall convey, transfar and assign to PgM or its designees (in such e.w propertisas u it acy dastgaate), free and clear of all lisas and sacumbrancas d.i . ether than (1) these which amisted at the time of conveyanae to such Participant.. (ii) 11eas 'securlag tasas or other governmental charges, the paynant of which is not yet deitaquaat, and (iii) 11eas and easumbrancas esused by the astr or omissions of Pgm, a11 its right, title and interest in the Units, the Property Interests and the fuel and operattag inventories for the Units and all ; i contracts, leases or other instrsaments relating to the Units. nee Uten the ' completten of'such conveyance, transfer and assignment, F5NE shall pay to the defaulting Participent an amount equal to the lesser of (i) the defaultias Participant's set Lavestmaat (as determined according to the method described in sub.peragraph (c) abeve) at the effectivanass of such terstantion is the I s
._ ~ . _ . , , . . _ - . _ _ _ . . _ _ . _ _ _ . . _ _ _ _ _ _ _ . _ _ _ _ . _ _ _ . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . _ _ _ . _ . _ _ _ _ _ _ _ .
-64
nit s , t r.e Fr:;e rty lr.t er es t s tr.
t r.e f.e; tr.1 :;er tt ir.g (r..itt.t :rie s f: r t'.e ii t't.its er "'(11! tr.e *.t.en f air arr'.et valso :f sait ief au;tir.g Farti:1;ar.t 's P M.ership Shue in tr.e '.'r.its. Prt;erty lr.terests ani such fae; ani invent:r. /. I f i its f.ithout giving effett te tr.e tefautting Parti:!; ant's ;:ss tf its ritt.ts in tr.e :t;a:ity ans : t;2: : f tr.e '.' nit s pursuant te ;aragraph 2 5.i's ? 6::ve'" . (
,}, gig, (iii) all amounts cved to MW pursuant to the terms of sub. paragraph (c) i abeve.
If the ansmet required to be deducted under clause (iii) of the preceding sentence is greater than the lesser of the amounts described in clauses (i) ud (11), the defaulting Participant shall remain liable for the deficiency. Notvithstanding any provisica hereof to the contrary, a i Futicipant shall not be deemed to be in default if (A) such Futacipant fails ! I to pay its Cvnership share of the cost of a capital ites, as hereinaf ter ' defined, vbich such Participant determines af ter good faith investigatten of all resonable altersatives can be financed only by the issuance of bonds or , other securities, ud (5) (1) if such Participant is a municipal corporation, $g such issuance requires the approval of the voters, town meeting members or city council of such auaicipality and is disapproved by such voters, tava aseting members or city council despite the best efforts of such Futicipant or (ii) in ! the case of'both a Futicipant which is a sualcipal corporation and any oth6r z Fartitipant, suah issuance requires such authorisaties by a state legislature -
.an d suah authertsaties is not granted despite the best efforts of such Futicipant, and (C) such Participant tenders to MW vithis five months (or suck longer parted as may be fixed by written agreeneat of the Participant and Mn) after the tattial paymaat with roepect to the cost of such capital ites has been rotuasted, a good and sufficient deed conveying to Mn, free and
.%r e,., - , _ . -
.s-,.. ,-, . -.-,.y , ,..__..m._ _
._,....-.----,..,_,._e , - - , - . , . .
clou of all lieu and encumbrasses, other than (1) those which utsted at the time of cesveysace to such Participant, (ii) liens securing tuas or other governmaats! chuges, the payment of which is not delinquent, ud (iii) liens 1 . j and encumbrances caused by the acts or osissions of PSNE, the portion of the Futicipant's ownership $hus in the Units determin6d in accorduce with the
- formula specified below. (Such deed shall be cespleted by the insertien of
! the percentage conveyed when the amount of the reduction is finally i > l determinable.) If the foregoins conditions are set FSNH shall undertake the i payment of the shus of the cost of such capital ites which such Participant , Q ! vould otherwise have been obligated to pay, such Participant shall not be i oblQated to pay such shue ud shall not be deemed in default hereunder by reases of its f ailure to make such paysant, and the Ovnarship Share of such 1 . t Participant shall be reduced in accordance with the following forwlas l Sy
- So M - (1.3 x A)) {
( V ) ! vberst ,
' f f. . i V = The lesser of (i) such Participant's unadjusted Cvnership share of A.e: ;
the estimated fair market value of the Units, the Property Interests and the fuel and operating inventories for the Un.its after addition of such capital ites, or (ii) such Participant's not investment as determined in accordance with the Unifers Systaa of Accounts prescribed for Class A and 3 Public Utilities and Licansees by the Federal Power Coussission as acended from time to time (or such similar accounts as may hereafter become appropriars) in the Units, the Property Intarests and the fuel and operating inventories for the Dmits plus such Participant's unadjusted ownership Share of the ' cost of the capital ites (as finally dotartised on the baste of the costs te PsNR.) , A = Such Participaat's unadjusted ownership Shue of the cost of the capital item vtich such Participaat is unable to pay including interest as provided in paragraph 11.1 en any part of such cost, already billed. 8,
- Suah Participant's ownership Share prior to nonpayment.
t O
.(. _ _ . . .-__. -_._ - . -
- , ,v , -,
. gest of a (or the) capital item" means (1) costs (other than costs for 6tich the Participants are individually responsible of the type described a paragraph 13.2) incurred under this Agreement for design, engineering, po:urement, installation, and construction of the Units, including costs neurred with respect to the acquisition of the Site, in excess of the estimated aggregate of such costs, which estimated aggregate of such ecsts f or purposes of this provision is $1,075,000,000; (11) costs (other can costs for which the Participants are individually responsible of the tpe described in paragraph 13.2) incurred under this Agreement with respect to renewals, replacements, modifications, additions, extensions, betternents and improvements of the Units, whether elective, pursuant to replatory law, or otherwise; and (iii) costs (other than costs for which ne Participants are individually responsible of the type described in paragraph 13.2 ) incurred under this Agreement with respect to any ecmpletion, repair, restoration or recenstruction of the Units pursuant te the terms of paragraph 19 hereef, in excess of any proceeds of
- nsurance or award upon condemnation available therefor. The costs requ red to be incurred in connection with the termination, shutdown, demolition or disposal of the Units shall not constitute " cost of a capital item," and the provisions of this paragraph shall not be applicable to a f ailure to pay such costs. (Fifth Amendment) 25.3 Failure by a Participant to insist on any occasion upen strict performance of any provs sion of this Agreement or to take advantage of any rights hereunder shall not be construed as a waiver thereof and no waiver of any provassen of this Agreement shall be l
O
.gre:tive unless in writing and executed by Participants having at least 13 of the CNnership Shares. ,
- 26. Arbitration 26.1 Any dispute among the Participants with respect to cis Agreement shall be submitted to arbitration on the request of a ferticipant. Copies of any such request shall be served on all
}articipants and it shall specify the issue or issues in dispute and s.:.tarize the Participant's clairn with respect thereto. Within ten clays n!ter receipt of such a request authorized representatives of all Tarticipants shall confer and atterr.pt to agree upon appointment of a s:ngle arbitrator.
If such agreement is not lend of page 33) o l
.O.
set:1g11shed, sty Ps.rticipant may retutet the American Arbitratier J.esocia.
' tien to appoint an ubitt. tor in accordance with its Camnercial Art stratica Rulu, which tvles shall govert the conduct of the arbitration in the absenta el centrary agressant by all Participants. The arbitrator shall cetdvet a hat?ing in F.anthes ter, NW gunpshire, and within th rty days there.
af ter, unless such time is utteded by agrescent of all Futicipante , shall totify ths Participants in vriting of his decision, stating his reucu for sut.h decicirn and listing his findings of f act ud conclusiens of lav. ne arbitrator shall not beve power to amend er add to this Agtesment, except as previded in pustraph 29 hereof. subject to such 11:::itatten, the decisica of the ubitrater shall be final and sinding on all Futicipants utept that any Participant may petition a court of competent jurisdiction fer rev'tev of errors of lev. De decision of the arbitrater shall determite and specify hev the expoues of the ubitratten shall be allocated ament the Participants.
- 27. Nottees ,
27.1 "%ny netire, dece.r.d, er repest te any Tardi:1;ar.t pursaut to a.ny provision of this Agreement shall be made in vrtting and shall be delivered either in persen, by prepaid telegram, or by registered or certified mail to an of ficer, of ficial, or agent of the Futicips.nt at such Futicipat's principal of fice or ptsee of business or to such of ficer. ~ e ", official, or agent of t.he Participant, and at such address, u may be designated from time to time by such Participant by writtan notice to the other Puticipants. If no such desissation by writtan notice shall have been made by a Participant, such futicipant shall be deemed to have designated such offier r of f tetal, or agent u shall have axecuted the most recant amendment or addendum to this Agreamant and such address u shall be shovo thereos. " ' O 4
.(6-
- 28. Seversb111tv of Provistees 28.1 A holding by any court having jurisdiction that any provision of this Agressent is invalid shall not result in invalidation of the entire Agressent, but all raesining terns shall remain in full forte and effect.
- 29. Au nds.ent 29.1 nis Apsoment may be amended from time to time by i
agreement in writing executed by Participants having Ovnership $ hues 1 aggregating at lasst 83 vith binding effact on all Participants; provided that to such amendment shall operate to chans* the Cvnership Share of a Puttt.jpat or its right to submit disywtes to arbitratign in accordance with partpub 26, without the orpress consent of such Fatticipant; and provided further.that without the express coxsent u all Participants no such maandment shall opnrate (a) to reduce the aforesaid pertantsgo of the Cvnership Shares n required to apes to an antadsent, or (b) to make the relative rights and obligations of any Participant differ in any respect from the rights and obligations of any other Participant, or (c) to change substantially (1) the description of the Units set forth in paragraph 1, (ii) the form of ownership thereof as set forth in puagraph 3, (iii) the relationship of the Participants as set forth in parapaph 6, or (iv) the nature of costs and expenses to be shared by the Participants as set forth in parapaphs 11, 13, 17, 19 and 24 la the avest any provision of this Astr,ensat is deterv,2ed to be invalid under or in conflict with any applicele statuta or any regulation or order of any regulatory agancy having jurisdiction, or is in conflict with any provisions of any electric power pooling spesinant to which Participants owning at least 8% of the Unit are signatories, the
O-f uticipante shall, woless they us.aniaevaly agtse that to ener.t.sant is necessary, attawpt by negotiation in good f aith to stres upon an asenenant t' of this Agreement which alis.instes such invalidity or scaflict while at the sans time paraitting the attenplishnent of the cbjectives hereof to the greatest extent possible. In the event that agterunt en an arent.asnt cantet be reached by putteita.tts having Cvtership $ hares aggregatteg at least i n the utter shall be suis.itted to a.rbitratico in accordance vit.h paragraph 26.; hereof and for this purpose only the arbitrater shall have the power to anset or add to this Agreement.
- 30. Art 11esbie Lav 30.1 This Agreemant is ude e. der and shall be goverted by 1
the law of The State of New Waspshire.
- 31. Ett3 31.1 This Agresunt shall ran.ain in full force and effect for (
the lesser of (i) the full useful livee of the Units or of any replaces.ent or reconstruction thereof pursuant to paragraph 19 hereof, or (11) the period of 1 ninety.nine years frons the data of executioni provided, however, that in the event it shall be found that tb P.ule against Ferpetuities applies, no traneter, conveyance or offerint of any interest in the Units or the Property Interests shall be' required to be made, and no option or right of refusal or declination vit.h raepect to any such trans fer, conveyance or of f aring may be e.sercised undar tary prevision of this Agreemant later than eventy.cne yes.rs after the dest.h of the last to survive of the following persone 11ving at the date of this Agreements Elizabeth A. Tallman, child cf Willian C. Tallman of ' 3edford: Deborah L. Adame, Stephen F. Adame, and $ ally Anne Adams, children of W1111sn A. Adame, Jr., of Manchesteri Christina J. Anders6n, grandchild of David W. Marrill of Candial tan 3. MacDarmott, Derek A. MacDermott, Kimberty 5. !O V I l
. ~ . . . . . . .. -
MacDermott, Joshua t. T. Tes ter, $hevn A. Tester. ud Samantha J. Tes ter, grandchildren of Eliot Priest of Manchesterl MaryAnne Sinville and Donald E.
$1mv111s, Jr., children of Donald E. Sinv111e of Manchester; amd David R.
4 Harrison, Cregory J. harrison, Marie E. Harrison, and Thomas C. Marrison, children of Robert J. Earrison of Manchesters all of the State of New Hamp. shiral ud provided, further that, nervithstanding the expiration of the ters of this Agreement, the provistou of this Agreement shall continue in ef fect after such swyiration to the extent necessary to pern.it full effect to be given to paragraph 2I.. , 1
- 32. Mis c ellanoeus 32.1. tach Participant shall, upon request of another Participant, anscute and deliver any docent reasonably required to implement any provisica hereof.
32.2 A Farticipant shall not have the right to challenge any v bili, invoice or statement, invoke arbitration of the same or bring any court or administrative action of any kind questioning the propriety of the same af ter a period of eighteen months free the date it is randered. In the case of a bill, invoice or stacament containing estimates, a Participant shall not have the right to challenge its accuracy after a period of eighteen months from the date it is adjusted to reflect the actual amounts due. 32.3 If it becomes necessary to estimate charges, any itas i billed on an astimated buis shall be paid vben rendered. A's adjustment vill be made to the artant appropriate after the actual amount of the estimated itas has bean determined. i
a - - - - - - - -
.)1 32,4
*his Agreemeat shall be binding en successors and aastgne of cash Participant I and, insof ar as permitted by law, on any receiver er t natae in bankruptcyo O 32.5 rec 6tvet' ship., or reorganisation of any Partiti;e.nt.
No usignment et transfer of any interest by any Participant except tr acc:rdance vith paragraph 3.2 hereof er the third f r:m last sentence f '* paragraph 23.1 *** shall re!! ave it :! any f '. . t - tts rbligsti:ts here',nter eksent ex;tess reisase by the reaairing .
.. ~ t 1.
Participants, but PSTri is authertred, en behalf of 451 Participants , and agrees to grant such an express release with respect to any transfer centemplated by the first refusal prevision of paragraph 23 hereof up n the furnishing to P5W of roasenable assurance that the financial an ity . of the assignee er transferee is substantit,lly as satisfactory as that of the Participant involved and that suth assignue or transferee has tet, or can reasonably be expected to ett prior to the time of iss uance of a construction per:it for the Units the financie,1 qualifisetten tet;uirements of the Atetic Energy Act of 195t, in the event of any transfer in accordance with paragraph 3.2 or the third frca last sentenc e of *** paragraph 23.1 *** hereof, each Participact shall be deemed to ha granted to the Participant esking such transfer its expreso release f rem' A. . e n d . all obligations under thio Agressent to the extant of t's ititerset trans-ferred except ob11 5 ations outstanding at the time of such transfer whether or not due. 32,6 Any number of counterparts of this igreement may be executed and occh shall have the same force and af fect as en original and as if all of the parties to all of the counterparts had signed the sarse instrumant. 12.7 Except to the axtent that the Pretirainary Agressent or any axhibit therete is specifically referred to herein and except to the tattfit that the continued applitability of any other agreement is specifically O . _ _ _ _ , _ _ _ _ . - - - - - - - - - - ~ ' " ' ' ' ~ ~ ~ ~ ~
/ 7 jf ; / 1\
~72-re::(nt:et herein, it:s Agreer.er.t 4.tt;'. :tr.sti: ,te tr,, g.t r, .
.:,rs. y .;.4 I
s tetve%3 the Parti:1;ar.ts, s. terse.iits any ans a;; ;tevi;;3 .n g , r g . g., .
- r i s
;ertaining to the sub't:t tatter ::ntaines f ertir . .,
*32.3 ?eferer:es. The f:11:ving sr.:rtr.ar.1 refer,r,:,3 gy r.sve teee :r :ty te e.;;;yet vitt res;e:t te the r.L et Ferti::;stis, lr. intal Trt: ,ferees. Altiti:nt' *rar.sferees. :r Trar.1;%ree sg te agne t.ny te ft:0 tt:e t: t Lme referen:et in t't.e Asrae ent : '
.S t.1: .ervice 0: ;any :f :tev Es.;st.ite i
F!:r! The '.' tit e d " * '
- stir.g ::n;any
! anger Kyi.-: I;e:tri :::;any 3hte:r .'., *
- ent ra; "aine, 7:ver ::r.;any ::7
Oentral 7eretn Patli: Zervire :r; rati c 0'/73 4
'he :r.r.e:ti;ut ' ist. tr.1 ?:ver ::n;ar.y :;L?
Tit:r.tur6 3as ar.d I;e:tri: Light :::tany Tit:r.t.rg 3reen M untain P:ver ::r;tratten *:f? F.uds:n *.ight ar.d T:ver :epart:ent H21s:n Maine Put:1e Service : star.y :75:
"as sa:husetts Munici;al '.T.t;esalt Ilectric ft:Tany 50 &*I M r.taup I;tetti 0::;any !!:ntaup i
- ev !viterd Gas and !!isen Light :::pany :G
- ev Intiand Pover Oct;any ::IP
! aunt:n Muni:1;al 116hting Flar.t Taur. ten
" err.cnt Electric Oceperative , Inc. */I;
*!erment I;ectri F:ver C::Tany, Inc. "IL"O
;r vited, hcvever, that any shcrthand referente stal; te f:r that ;ur; se
- nly and shall n:t cthervise centr:1 cr af fect *:he :Teratien :r inter; rett-11:n :f any Of the provisitt.a of the Agreement.*d' f
*33. *e rtate Atreteent s cer.eetting I_ey.et e:-tien :P the " efts 33 1 Tleaneine of tests. Each Fartici; ant vill use its reasonab).e best efforts, subject to regulatory require ents, to finance its l
?vnership Share of the costei of ec=pleting in a timely =ar.ner censtruction l (E. .e e f the !.'ci t o . If at any ti:e a Tarticipant (a " elinquent Tarti:iiant") l i
should determine that it cannot pay its Ovnership Share of current construe. ! tien cents, it vill notify the other Participants in vriting, in as titely a manner as possible. One er : ore cf the re:Sining Participants :ay then, after I I
\
i
> 'l l' .71.
n tite;,f n:tt.:e :: t;; 7trti::patis. Stat :n tehs;f :P ine e'ir.t.ent Ftrit:;. .
;5nt attances I r a*; . :r init :f tr.t 1:na.ely ;sy .tr.ts ;.e fr:t tr. ! e;i r.t .e r.
?trt t !;u.t. 1r. the event tvt :r e.f re 7trii:!;tr.ts itve r.:ti:e :f tr. :nter.t te sake aivances aggregttitt t:re tr.En tr.e ,:r.tr.;y flytents 1.e fr: . tr.,
e' tr.tver.t 7trti:1; r t , tr.9 c' f t'. . : .tAs 42:n sivar.:es sht'.; le t;;;rt;;*.e t f tetweet, t1 ;* tt: rtst:e vitt. tr.eir retiettive lv.ersat; Intres tr it : .:- (t 4
- tner star.or as iney st/ 1(ree. *f v;ts.ir. ! .:r.tr.s ttter it ie::.ss it'.nt.: .
- L in its ;ay er.t :t :strer.: ::r.str;:* t :r. ::st s . tne 'e'.int.or.t Ft rti:1; t s. fs;.:
l t re::ttente its ;ty er.ts, sne re;ay ti.e tavantes ;;.s in*:erest at tr.e stte ! I I;etified in ;artgraph 11.1 :f the Atreement fr:r. the istn :f tr.e tivtt:e t: 4 the late :t re;tynent, ther. at the :;ti r. :f en:n 7t:ti:!;snt vai:n sts
- sie - -
! advantes. la) its ?.*nershi; ! hare snat'. te .naresset and saat :f the
- eitt;2ett ;
4 4 7mrti:1; ant Jetressed, so that the ivr.orship there :f each is t- the ;rt;:rti:n it. ; 4 .t: [ vht:h the aggregate ::sts ; aid by it lin:1uding said s Avan *es) tvers *:
- r. e e r
2 t:tal c:sts sp;11:st;e te al. 7trti:1; ants, :r ' t) it shall he : ret!*.61 vitt. ! the a: cant :r its odvantes against ;ar:er.ts which v:uli ettervise te i.e f t:r. ; su:h Parti:iyar.t thereafter :r. a:::ur,t :f (* s existing Ovt.ersht; Itare. ,
!;ch :hanges in tvr.ershi; Shares shall take effect when at* regu;stery .l l i
)
'- a;;rovais therefer are received, and the Ftrstri; ants agree to use their . f test eft:rts to Ottain such a;;revals pr:ettiy. , ; 33.x Ter.itati t er F stensten if !:r.struetten :? !;erettre, i Metvithstac61cs any other ;r:visi:n cf this Agrescent, Ff:IH vill net terr.it. ate l the Project, suspend constructien for an extended 79 tied, or defer the schei-uled dates of'ecamercial creratien of either of the '.'r.its, exevpt (a) vish < thevrittenagreementcfPart.ct; ants (includingPSXH)havir.gOvrotshi;thtresf aggregating at least T5%, or (b) unless such actien te required by any-;sv. _j b , teralatten, er crier of any governmental bedy or agency er by reason of an 1 ! emergeney require = tats aof rutlic safety or health, or other similar causes.*** '- ! l a Y
~
r i
~l 4 . - .---.- 1 l _-
i 74 ana34, Cres.Jon of "Nersight Co m ittee 36.1 An Oversight Comittee of five ($) members is hereby established to participate in the oversight of the Project. Members of , the Oversight Cc atttee shall be appointed f rom time to time by l ajority vote of Participants, with each such Participant's vote given l Veight proportional to its Ovnership Share in the Pro;ect. Members of , the Oversight-Committee vill have experiena.e in nuclear constructica and l operation. The Oversight Ccemittee vill hold meetings as required. but ' no less frequently than once a month. It is the intent of the Participants that at all ti es .the Oversight Committee act consistently with the regulacions of the Nuclear j 3 Regulatory Comission (NRC) and that there be no delegation to, not. { assumption by, the Committee-of any duties or authority given to the NRC
' licensees. ' 1$th q
' Mand pg . The Senior Vice President of PSSN or such other officer i)
\
of PShH vith primary responsibility for managing the construction of t - .I'
-Project vill, from time to times (a) inform the Oversight Committee of i
he status of the Project and of problems and other developments at the ' sitet and -(b) meet with the Oversight Comittee at such times as'the
,' ;t f m ittee may r. quest.
I PSNR vill consult with the Oversight Committee prior to ' making major decisions in :ennection with the Project which PSh1 could I l reasonably expect to be of concern to the Participants. Each such con- l i. sultation shall be se detailed as time permits. -PSNH will follow the I .. l recommendations of the Oversight Committee to tho' extent reasonably j. t
' practicable -unless PSh1 believes that such' recommendations are not in i
accordante with the :RC regulations or prudent utility practice. *he ' creation of the Oversight Cei.mittee shall net te deemed to af f ect PS!M's
\ ,
responsibility for construction under this Agreetent.
- 35. Appointment of Disburstne Atent .
35.1 Participants evnint fifty-one ;ercent (Sli) :r ere z.f of the Ownership Shares may appoint :ne or . ore disbursing agents to receive, hold and disburse payments due it:m Participants under the terms of this Agreement, including without li.sitatien Paragraphs 11 and 1 1 13 of this Agre ment. J5.2 All monies paid to the disbursing atent er agents sr.au l':i-not be property of the Participants, but shall be held in escrow an. Gistursed car by the Disburaing Agent, subject to and in accordance with the provisions :f the Agreement for Seabrook Project Disbursing Agent made as of May 23, 198!.. i as amended. 35.3 The disbursing agent or agents so appointed shall disburse monies received from Participants only to meet each Participant's own Ovnership Share of the costs. 35.4 The powers, cuties, responsibilities, terms of employment, ccmpensation and other matters regarding the disburning agent ;3... or agents so appointed shall be limited to activities reasonably incident Ag to collection and disbursement of Participants' payments, as distinguished from those of a managing agent under paragraph 36, and shall be further defined by written agreement of Participants evning fifty-one percent ] (51%) or more of the Ovnership Shares. The disbursing agent or agents may be removed by Participants owning fif ty-one percent (51%) of the Ovnership Shares, and a successor disbursing agent or agents may be appointed by Participants owning iif ty-one percent (51%) of the ownership l Shares. The disbursing agent or agents may resign by giving seven days' prior written notice to all Participants. O 1 g _ _ _ _ _ _ _ _ - _ _ _ _ _ _ - _ _ _ _ _ _ - _
35.5 The disbursing agent or agents an appointed .ay assess Participants for their Neership Shares of the ordinary and necessarv :ts:s k' of carrying out the functions of the disbursing agent, including the ::sts of :ounsel.
- 36. _Chanee In Prefect Mansee ent, s
)_ 36.1 "pon the written agree:ent of Parti:1 pants :vning fifty-ene percent ($1*) or ::re of the Ovnership Shares, approval ef :ne necessary regulatory authcrities, including any necessary action of the NRC, and appoint:ent of a anaging agent under Paragraph 36.2 PShH shall be relieved of all of its management duties, functions, responsibilities, prerogatives, discretionary rights, and authorizations to act !ct and on behalf of all other Participants hereunder, including, without limitation, , thesa described in Paragraphs 8, 9, 10, 12, 13, 19, 20, and 24; provided, i however, that nothing herein shall be construed so as to affect PShm's
!!!h Ovnership Share or its duty to pay its Ovnership Share of the costs of , A..e nd .
the Project, or to perform such other duties as are required to be per-d formed by each Participant. 36.2 L'pon written agreement and effective upon approval of the necessary regulatory authorities, Participants owning fifty-one percent (51%) or more of the ownership Shares may appoint a :tansging agent (which may be a Participant) for the Project who shall perform all of the management duties and functions, and who shall have all of the ~ responsibilities, prerogatives, discretionary rights, and authorisations to act on behalf of all other Participants previously vested in PShT. The terms, powers, duties, responsibilities, term of amployment, compensa-tion and other matters regarding the managing agent so appointed, vill be defined by written agreement of Participants evning fif ty-one percent 1 l _ _ __ _ _ _ _ _ _ _ _ _ . _ _ . _ - - - _ - - - - - - ~ --
1 l i 1 i i p- (511) or more of the Nnership shares prior to the ef fective date of tr.e
't 4 S a;pointzent..-The Managing Agent may be removed by Participants vning at
;3th least fifty-one percent (51':) of the Cvnership Shares, and a suttessor j., e n o . ,
Managing Agent ay be appointed by Participants owning at least fif ty-:ne l percent (51';) of the Nnership shares. The Managing Agent .ay resign ; pen I written notice to all Participants.***
" * )7. Creation of Executive C eittee j
* *
- 3 7 .1 (a) An Executive Committee is hereby ;
established to perform the functions set out in this Paragraph ) 37, subject to the limitations of Paragraph 37.4 and 37.5 i I below. The members of such Executive Committee shall be j q appointed from among the Chief Executive officers of Partici-J pants in the Units, and may be removed, according to the following' method:- (i) as to each of the New England States . h [s - (except the State of-New Hampshire), all of the investor-owned
,16th
;.eend.
j g and cooperative Participants serving that State, at wholeaale ~ Q
! 1 or at retail, shall together select, and may remove, by a I majority of the total Ownership Shares of'such Participants, I' I
t the Chief _ Executive Officer of one such Participant as an Executive Committee member (currently, the--Participants serving
. Connecticut, Maine, Massachusetts, Rhode Island and Vermont shall thus each select an Executive Committee member), except that no Participant shall have more than one representative on the Executive Committee; (ii) if the New Hampshire Electric !
Cooperative, Inc. and all of the investor-owned and cooperative - Participants serving Vermont so agree in writing, such - Participants may together select an Executive Committee member. I 4
vho shall be the Chief Executive officer of a Participant
~
serving Vermont and (iii) all those Participants owned by or '\/ organized pursuant to authority of governmental entities shall select, and may remove, by a majority of the tetal ownership I
\
Shares of such Participants, a Chief Executive officer of one j such Participant as an Executive Committee member. The-foregoing selections and removals shall be made either at a l meeting of all Participants or at a special . meeting of the Participants that are entitled to select the member. Any member of the Executive Committee may designate an alternate to attend and vote at any meeting of the Executive Committee in - his place and stead. (b) In-the event-that a member resigns or is removed f rom the Executive Committee or becomes unable to serve as an i 16th Executive Committee member-by virtue of default in payment og Amend A) (_, Project Costs as described in clause (c) of this Paragraph 37.1 or by disablement, death or resignation or removal as a Chief Executive officer of a Participant, or if the Participant employing such member as its Chief Executive officer ceases to
.be a-Participant or is succeeded by another Participant, the successor to such member shall be selected within two weeks of the date on which such vacancy first occurs and by the same method as such' member being replaced was selected.
(c) The Chief Executive officer of PSNH shall be and shall remain as an additional member of the Executive Committee so long as PSNH continues to pay its full share of current Project Cests tas defined in Paragraph-37.4). No other O
l l l Participant shall be entitled to have its Chief Executive () U officer or alternate serve on the Executive Committee if it is more than one month in arrears in the payment of its full share of current Project Costs. (d) The Executive Committee shall be entitled to I appoint task forces, consisting of persons who are not Executive Committee members, to undertake specifie assignments or its behalf, including oversight of the activities of the Dinbursing Agent appointed under Paragraph 35. The Executive Committee will maintain supervisory control over each task i force. Each task force and each member thereof shall be l l considered a designee of the Executive Committee. l
**e37.2 (a) The Executive Committee shall hold meetings (
as required, but no less frequently than once a month. A () quorum for effective action at any meeting of the rxecutive Committee shall consist of a mkjority of all members. The 16:h A 'nd* 1 Executive Committee shall act by majority vote of its members present, voting per capita rather than by ownership Share. ( b)- The Executive Committee may adopt rules of procedure or by-laws.to govern the conduct of its. meetings and the performance of its functions under this Paragraph. The Executive Committee shall appoint a Chairman, who shall have such duties, consistent with this Paragraph, as the Executive
-Committee may give to him, ,
(c) The Executive Committee shall be subject to I control and direction by the Participants, and action of the 1 1 J. l l
-to-Executive Committee may-be modified by. Written agreement executed by Participants owning fifty-one percent ($1%) or more , y of1the ownership Shares except that the rights, duties and responsibilities of the Executive Committee under the Agreement - j.
I for Seabrook Project Disbursing Agent may only be modified or ' altered by amendment of that agreement, and the Executive Committee's actions thereunder shall only be subject to
-modification consistent with the provisions of that agreement. ',
. 6 ,. .,. .l; (d) Upon the effectiveness of the appointment of a ' E~
- I'd '
managing agent pursuant to Paragraph 36 of this Agreement, the powers, duties and responsibilities of the Executive Committee 3 1 set out in this Paragraph shall be reexamined and may be modified; provided that any modification shall be consistent with this Paragraph, including the limitations of Paragraph-
) i ~
J :
-nl-t
***)?.3 (a) On a :luarterly basis, er ore frequently t!
the Executive Ccamittee so requests, the Pref ect Manager shall ;repare
' (,) and pressnt to the Participants an itesized cash budget for Project
-Costs-(as defined in Paragraph 37.l.) for each of the next six .enths (ref erred to as the ne.xt six cenths' budget") and, if c:nstructi:n :t either t' nit is in pregress, !:r Pr: ject C:sts of ::nstructi:n threugn ec=pletion,'vith an esti.ated date f or scheduled- c:=ercial operati:n.
The Project Manager shall feliver a copy of such ne.xt six senths' budget , (with- the estimated ecsts through c: pletion and the estimated date :! ' c:=pletion) to each Participant at least ten days before the Participants' ,
- eeting called to censider it. The E.xecutive C::mittes ay also present j to' the Participants its recomentation with respect to the no.st six sonths budget and costs through cc pletion, The Participants shall review the ne.xt six months' budget, and, af ter consultation with the 1*th Project Manager and the E.xecutive Cc=mittee, shall either approve or /c e ne ,
.p modify the aggregate dollar' amount of such budget pursuant to the :sthods t i V described in either subparagraph (b) or (c) below, as appropriate.
-(b) Prior to full funding of construction, the Participants shall approve orLeodify the next six months' budget by either of the folleving methods, as appropriates g (1) agreement by Participants owning fif ty-one percent- (51%)
or more of the Ovnership Shares in the Seabrook Project, if the aggregate dollar amount of such budget does not exceed the aggregate dollar amount , of the current six months' budget, provided that if Participants owning more than forty-nine percent (49%) of the Ownership Shares in the Seabrook Project do not disagree by the tenth day after the meeting called and< held to consider it, then the Participants shall be deemed to have approved' such budget; or A b
t
' (ii)- agree:entLby five_(5) r-mere Partic!; ants :vning
I
)V--
t sixty-two percent,(62%) or more of the Ownership Shares in the Seabrock Project. If the aggregate dollar amount of such budget exceeds the aggregate'dellar amount of the current six months' budget. except that if such proper: ion and number of Participants ido not so agree by the tenth day after'the Participants' testing called and held to censider it, then the Participants shall be deemed to have approved the next six months' budget in an. aggregate dollar amount equal to the current six months'
. budget.
(c). After full funding of construction, the Participants shall a. approve-orfmodify the next sLx months' budget by either of the following ((([..fg, ;
=methode as appropriate I
-(i) agreement by Participants ovning fifty-one percent (51%) '
or more of the Ownership Shares in the Seabrook Project, if.the aggregate
/'
dollar amount of such-budget does not exceed one hundred and ten percent (110%) of the aggregate dollar amount of the current sLx months' budget. ; provided that if Participants owning more thanl forty-nine percent _(49%) of the Ownership Shares in the Seabrook ~ Project do not disagree .by -the 7 tenth day after the meeting called and held to consider.it, then the Participants shall be deamed to have approved such budgeti or (ii) agrennent- by five (5) or more Participants owning sixty- .. two percent (62%) or more of the Ownership Shares in the Seabrock Project-if the aggregate dollar amount of such budget' exceeds one hundred and ten : _ percent (110%) of th'e essregate dollar amount of the current six months': ' budget, except .thac if such proportion and number of Participants do not
- so agree by the tenth day af ter the Participants' meeting called and held t
4
to ::nsider it, then the Participants shall te dee ed to have appr:ved : e
,q.
next six senths' budget in an aggregate dollar a. cunt equal to the :n rent "
. '.*th M.e t:
six months' budget. , l (d) The Executive Cee.ittee sna11 use, and shall be entit'ed :: rely upen, the aggregate budget se actreved er det.ed appr:ved by the l Partici; ants, in perf or.ing its f un:ti:ns under snis Paragrapn,'**
***37.4 The Executive Committee shall perform the folleving functions and shall also have the specific rights, f and be subject to the specific duties and responsibilities. l qiven it in the Agreement for Seabroch Project Disbursing Agent ,
made the 23rd day of May 1984: (a) On a periodic basis, the Executive Committee shall . _j l l review and approve or modify the Project Manager's budget, 1 Workplan and level of activity to assure that construction , b . costs, costs resulting from suspension and termination I ;16 eendth (including any costs associated with restarting construction ; I atter suspension)._and costs of operation and maintenance of the Units (all such. costs being collectively referred to in this Paragraph as " Project Costs") incurred or proposed to be incutted by the Project Manager on behalf of Participants (i) a are authorized by the provisions of this-Agreement, including l Without--limitation-the' provisions of Paragraphs 11, 13 and 24.2 l l of this Agreement and the Resolution ref erred to in Paragraph 24.2, and (ii) do not and. vill not exceed the ceasonable l f I budgetary limits established by the Participants f, tom time to r time, as provided in Paragreph 37.3 above;
(b) 'The Executive Committee shall provide direction 9-~s to and overste the functions of the Disbursing Agent appointed (sb under Paragraph 35 of this Agreement to assure that
~
Participants' payments and the funds and credits attributable to those payments are properly allocated and applied under the provisions of this Agreement, including without limitation l ensuring the proper application of credits to Project Costs and 1 the allocation of payments made by each Participant to pay only such Participant's ownership Share of such Project Costs; and shall further provide direction to the Disbursing Agent and shall oversee the allocation of Participants' payments in cases where one or more of the Participants have not paid their Ownership Share of Project Costs; (c) The Executive Committee is authorized to conduct a search for and make recommendations to the Participants with 16th r respect to a new managing agent to be appoi.nted under Paragraph **
- 36 of this Agreement and upon the execution of a written agreement making such appointment as provided in Paragraph 36, shall be authorized to take any and all steps necessary to effectuate the transfer of project management; provided, however, that the Executive Committee shall take no action that would subject the Participants to additional No.' Hampshire regulation; (d) In respect of the functions given to the Executive Committee by clause (a) of this Paragraph 37.4 the t
Executive Committee is specifically directed to ensure that no
/'~) '
V
I liabilities on behalf of Participants are incurred with respect to, et bill'd or paid f or. Project Costs of Unit 2, e xc'e pt insofar as such liabilities, bills et pa) unts are consistent with the limitations of Paragraph 24.2 of this Agreement and the level of construction of Unit 2, if any, approved by the Participants under this Agreement.
***37.5 It is the intention of the Participants that at all times the Executive Committee shall act consistently with the regulations of the Nuclear Regulatory Commission
("NRC") and that there shall De no delegation to, not assumption by. the Executive Committce of any duties et leth authority that would conflict with NRC permits oc licenses held by the Participants or the technical specifications for the Units. The Executive Committee shall exercise only the limited financial oversight and direction functions set out in this Paragraph 37, and the creation of the Executive Committee shall not be deemed to affect the duties and responsibilities for construction, operation and maintenance of the Units, as provided in this Agreement, of PSNH when acting in its capacity as Project Manager or of a managing agent appointed pursuant to Paragraph 36. The Particip' ants (other than PSNH When acting in its capacity as Project Manager) do not hereby undertake, or intend to undertake. or grant to the Executive Committee, any responsibility for management of the construction or operation l t i and maintenance of the Units. O
i I I I
* * *37.6 Neither the Executive Committee not any member or designee thereof, when acting in such capacity, not any empicyer of any member or designee, not any affiliate, agent or employee of such member, designee et employer, shall by virtue of its or his celationship to the Executive Committee or any member et designee thereof acting in such capacity, be liable to any Participant for claims for direct, incidental, indirect, consequential or other damages of any nature, including, but not limited to, damages for loss of anticipated profits, loss of use of revenue, loss by reason of construction shutdown et interruption and cost of capital, connected with or resulting from the actions of the Executive Committee oc of any member or designee thereof under this Paragraph, undet the Agreement for g
;.m d .
Seabrook Project Disbursing Agent, and under the Participants, Hay 14, 1984 Resolutions, except in the event of willful misconduct. In addition, the Participants, severally (and not jointly, or jointly and severally), in accordance with their respvetive ownership Shares, agree to defend, indemnify and ho let tM Executive Committee and each member and designee thegoci, when acting in such capacity, and each of the other persons or entities referred to in the preceding sentence, harmles*; against all losses, elaims, expenses (including zeasunable counsel fees) and liabilities, not resulting from -
- his or their willful misconduct, which may be asserted, imposed or incurred in connection with the performance of,his or its responsibilities under this Paragraph, under the Agreement for l O
- - - - - - - - - -_ ________m_
Seabrook Project Disbursing Agent, and under the Participants' () May 14, 1984 resolutions, including any litigation arising from the foregoing. Nothing in this Paragraph shall be construed to , affect any Participant's ownership Share or its duty to pay its Cwnership Share of the Projec- Costs or to perform such other duties as are required to be performed by each Participant under this Agreement, under the Agreement for Seabrook Project Disbursing Agent, under the Participants' May 14, 1984
* [-
Resolutions, or under other agree- ments among the Participants.
*** 37.7 The Executive Committee may assess Participants for their respective ownership Shares of the ordinary and necessary costs of carrying out the f unctions of the Exe:v'.ive Committee, including the reasonable costs of-consultar.ts and counsel."
O h () , l
E1CHTH M2:CMI.NT 70 ACREEMIC PCR JOINT OWER$ HIP, CONSTRUCTICS AND CP!'.ATICN CP N!V RAXPSHIRI !.TCttUt UNITS This Amandatory Agreement made as of the 25th day of April, 1979, by and among Public Service Company of New Hampshire (Psyn), The United 111h inating Cc=;any (UI), Bangor Hyd o-Electric C::;any (3 anger) . Central Maine Pover Cc=pany (CMP), C n .;: ',ermont Public Ser rice Corporation (CVPS), "he Connecticut Light and Power Co:pany (CL&P), Titchburg Cas and Electric Light Cc=pany (Pitchburg). Hudson Light and Power capartment IHudson), Maine Public Service Company (MPC), Massachusetts Municipal 'a*holesale Electric Cempacy (.%'EC), Montaup Electric C pany (Montaup), New Bedford Cas and Edison Light Ccepany (N3), New England Power Company (SIP). Taunton Municipal Lighting Plant (Taunton), and Ver ent Electric Power Company, Inc. (VILCO) (the Participants) O 2. Effective Date of thie Eighth Amendment. a
*'han counterparts of this Amendment have been executed by Participants having Ownership Shares aggregating at least 80%.
this Amandatory Agreament shall become ef f ective in accordance with paragraph 29 of the Agreement. (Eighth A: *1:ent became effective April 25,19T9) O l
NINT)! AXINtXI.NT TO AGMLYE.TI TCR JC :T! CWT MRIP,
\
C;ss RUC;;CN AND OT!h!!0N CP W F.MSF.*?I '."lC'.'.AR '!N!!S This Anandatory Agreement r.ade as of the 5th day of June, ;9*9, by a:d among Public Service Cenpany of New F.aspshire (P$hN), Se 'Jnited
- ll einsting Company (U:), langer Hydro-Electric C:apany '3 anger),
Central Maine Power Cenpany (CMP), Cantial 7ernent Public f ervice Corporation (CVPS), The Connecticut Light and Pcver Cenpany (Ct&P), Titchburg Cas and Electric Light Company (Pitchburg) Hudson Light and Pove: Depar=:ent (Hudson), Maine Public Service Company (MPC), Massachusetts Municipal *.'holesale Electric Cenpany (%TC), Montaup !!actric Cen;any (Montaup). New Bedf ord Oas and Edison Light Company (SB), New England Povar Company (STP), Taunton Municipal Lighting Plant (Taunton), and Vermont Electric Power Company, Inc. (\T!.CC) (the Participants), O ... b
- 2. Ef f ective Date of this Ninth Amendment Den counterparts of this instrCatit haV4 been executed by the Participanta, this Anandatory Agreement and the anandnent expressed in Section 1 hereof shall become ef f ective in accordance vita paragraph 29 of the Agressant.
(Ninth Anendment tecane effective June B, 1979) s t
1 I ( i I i r (' IINIH AM N0 Chi *0 ACP.!D;thi T;g ;;;g c.,g.gg y.7
- NS 7.'Jc- cN Ass cPr?.4 : 9 ey m x4,95d'u s.m hm i This Amandatory Agreement made as of the 11th day of cctober,
;P79, by and ances Public Service Cc=pany of New Ka:pshire (Psyx), rhe k
'.'nited:1$u=inatingCc=pany,BangerEydro.ElectricCen;any(la ,
Cent: i 41 Maise Power Ccapany (CM7), Central Verment Publit Service Co rpo ra tist, The Connecticut Light and Fever Ccrpany, Titchburg Can and Electric Light Ccepany, Hudson Light and Pever Capartment (Budson). Maine Public Servtes Ccapamy, Massachusetts Municipal '.%olesale I;ectric Cetpany (MHVIC), Montaup Ilectric Company (Montaup), Srv ledford- Cas and Idison Light Cenpany (V3). New England Fever Company, Taunten Municipa Lighting Plant (Taucton), Vermont Ilectric Cceaavative, Inc. and Versent Electrit Power Company, Inc. (the Participants). e f 4 I!!ac tive Oa t e of tr.is *e-th Amendment. I Vhan counterparts of this A=end:ent have been executed by the Initial T staf ereas raf stred to herein and by Participants (in-i cluding the Initial Transf acess) having Ovnership Shares aggregating ' at larat 601, this Amandatory Agreement shall becesa af fettive in accordance.vich paragraph 29 of the Agreemanc. I (Tenth Amendment became effective October 11,1979) 1 l 1' l l
.h] '
e m. t
l l
. \ 'X' l i tttVENTH AMEN:ntENT 70 ACRI@ TNT PCR .'c:N; C'c RsH:p, V} : CONSTRt'CTteN AND CPERAT 0N CF *:t_ WPSM:KI *:t*CitAR . :!75 inis Amendatory Agree =ent made as of the 13th day of Cete:eer, q 1979, by and asong Public Service Cetpany of New Ha=pshire (PsNH), The L'nited 111weinsting C:epany, Bangor Hydro-tinctric C:=pany, Centra!'
Xaine Power Ccapany, Central Vermont Public Service Corporation, The l Connecticut Light and Power Company Titchburg Gas and Electric Light Ccapany. Hudson Light and Power :epartment, Maine pus 11c Service C::pany, Massachusetts Municipal Wolesale Electric C =pany, Montaup tiectri: Ccapany, New Bedford Gas and Edison Light Cetpany', New England Pever l Company Taunton Municipal Lighting Plant. Verzont tinctric Cooperative, Inc. and Vermont Electric Power company, Inc. (the Participants), t i i (- - -j 4 Effective Cate of this tieventh Amendsent. Wen counterparts of this Amendment have been axacuted by PSNH and
, the Participants named in paragraph 11.2 of the Agressent, this Amandatory Agreement shall becces ef fective in accordances with paragraph 29 of the Agreement.
(Eleventh At:end:ent became effective ecember 15,1979) v I
;'itLPTH A>!E::::!NT TO ACA!!;11):7 POR JC:: C?:!RSH:P,
.f^ - C 0':!
; 7;CT cN C:0 c ?!MT:0S 7 7. ':!'i F.2.':P ! v' t ! *:r:*. I.ut '. ':: s V- _
This Amandatory Agreer.ent .ade as c! :he 16th day of June, H50 by art amorg Public Service C:mpany of :ev M4:pshire (PS:.?), The 'Jni:ed
- e. na
- ing Cc ;any, langer Hydro-!;ec
- ri: C::;any, Central ::stne ?:ver C:r;any, Central Vert:n: Pub 11: Service C:rporation, the C:nne::i:u:
Ligh: and Power Co:pany, Pi:chburg Cas at.d !!actri: Light C::pany, Mudsen Light and Pover Depart:ent, ): sine Public Service Corpany, !!assa:n setts
!!vnicipal Vnolesale Electric C:=pany, !!antaup Elec:ric Company, : ev ledictd Cas and Idison Light Cecpany, New England Pcver C:spany Taun :n
!! uni:1 pal Lighting Plant, Verment Electric Cooperative, Inc. and Ve::ent Elec:ric Power Company, Inc. (the Participants),
- 6. !!fective Date of this Tvelfth Acerdment.
There is provided opposite the na:e of ea:h signatory to this
}
Amend:'.nt boxes for such signatory to indicato whether it agrees b . or does not agree that one or both of the a:endments provided in Sections 1 and 2 of this As.endment shall be applicable to such signatory. The absence of any check in such a box vill be presu:ed to be agreement to such applicability of such Amendment. 'the n counterparts of this Amendment have been executed by Participants having Cvnership Shares ag'regating g at least 80%, this A=endatery Agreement shall become effective in accordance with Paragrapn 29 :! cne Agreement and in accordance with the !:llowing provistor.at (a)- Section 1 of this Amend:ent shall be applicable to the advance pa> tents made by each Participant who executes a coun:ertart and agrees to such applicability. The date for ce==encing= crediting of advance pay. ants of those Par:1cipants who indicate they do not so agree shall remair. July 1, 1930. (b) Section 2 of this!A:endment shall be applicable co-each Participant who executes a counterpart and agrees to such applicability. Each Participant who indicates that it d:es not agt'ee that Section 2 shall be applicable to it shall no:
'be obliged to make the advance pa}3ent specified in Section 2.
(c)' Section 3 of this Amendment shall be applicable to each Participant who agrees that Section 1 shall be applicable to it, belfth Amendment became effective June 16,1980)
1 i
}
i
. t THIRTttnH A.mMEn to ACRIEMEn FOR JOINT Ob'h*tPJHIP, CONS *1tvCTICN AND cPE AA!!0N of NTV UAVPSR!RI NUCLEAR 'JN!!S This Thirteenth Amendment .to Agreement Tor Joint Ovnership, I Construction and Operation of New Hampshire Nuclear Units (the 'hirteenth Amendment), made as of the 31st day of December,1980, by and among !
Public Service Company of New Hampshire, na United Illuminating f Company, Bangor Hydro-!!actric Cetpany (Banger), Central Maine Power Cowpeny (CMP), Central Vermont Public Service Corporation (CVPS), ne Connecticut Light and Power company, Titchburg Cas and Electric Light Cocpany (Fitchburg), Hudson Light and Power Department (Hudson), Maine l Public Service Company (MPSC), Massachusetts Municipal Wolesale Electric j Company (E4C), Montaup Electric Company (Montaup), New Bed!ord Ca: and Edison Light Company (NS), New England Power Company, Taunton Municipal Lighting Planc (Taunton) and Vermont Electric Cooperative, Inc. (VIC) (sometimes also collectively the Participants).
'J . . .
- 4. Effective Date of this n itteenth Amendment.
Won counterparts hereof have been executed by Bangor, CMP, CVPS, Fitchburg, Hudson, MPSC, W4C, Montaup, N3, Taunton and VIC and by Participants having Ownership Shares aggregating at least 80%, this Thirteenth Amendment shall became effective in accordance with Paragraph 29 of the Agreement. j (Thirteenth Acehhent became ef fective Dececter 31,1980) J O
TOURT' Cr"E AMENDMENT TO ACkIEXENT TCR JOINT CVNERSEIP, CONSTRUC a tCN AND CPD,ATICH of 5'EV V.AMPSE:P.I hJCLiAR ','s'tTs O . This Tourteenth Amandment to Agreement Ter Joint Cvnarship, Construction and operation of New Kampshire Nuclear Units (the Tourteenth Anandment)., r.ade as of the 25th day of May,1982, by and asons Public Service Company of New Hampshire, The Unitad Illu=itating Company, tal r Hydro-Electric Company (Eanger). Central Maine Power Ccapany (CMF), Cantral versont Public Service Corporation (CVPS), The Connecticut Light . and Power Company, Titchburg Gas 'and Electric light Cerpany (Fitthburg), Eudson Light and Power Department (Budsoni, Maine Public Service Compsny (MPSC), Massachusetts Nnicipal Wholesale T.lectric Company ('tMWEC), Montaup Electric Company (Montaup) New Bedford Gas and Edison Light Company (,NB), New Eng1'and Povar Company, Taunton Wnicipti Lighting Plant (,Taunton) and Vermont Electric Cooperative, Inc. (VEC) (sometimes a. iso collectively the Participants). 4 EffIetive Date of this fourteenth Amendment Vben counterparts hereof have been executed by Participants having
, ovoarship Shares aggregating at least 80%, this Tourteenth Amandmant shall become af fective in accordance with Paragraph 19 of the Agressant.
(TourteenthAmendmentYecameeffectiveMay 25, 1982) 4 e gi 4 h 9
4 ' FIFTEENTH AMENDKENT OF AGREEMENT FOR J0!NT OWNERSHIP, CONSTRUCTION AND OPEPAtt0N OP NEW RAMPSHIRE NUCLEAR UNITS O This Fifteenth Amendmant to Agreement for Joint Ownership, Construction and Op 'tation of New Hampshire Nuclear Units (the " Fifteenth Amendment") made as of the 27th day of April, 1984, by and among Public Service Company of New Hampshire. The United 111uminating Company, Bangor Hydro-Electric Company, Central Maine Power Company, Central Vermont Public Service Corporation Canal Electric Company (successor in interest to New Bedford Gas and Edison Light Company). The Connecticut Light and Power Company. Titchburg Gas & Electric Light Company Hudson Light & Power Department Maine Public Service Company, Massachusetts Municipal Wholesale Electric Company, Montaup Electric Company, New England Power Company, New Hampshire Electric Cooperative, Inc., Taunton Municipal () Lighting Plant, and Vermont Electric Generation and Trans-mission Cooperative, Inc. (the " Participants"). B. When counterparts hereof have been executed by least Participants having ownership Shatos aggtegating at eighty percent (80%), the provisions of this Fifteenth Amendment shall become effective in accordance with Paragraph l 29 of the Agreement. , (Fif tesnth Amaninent became of f active April 27, 1984) O e
I L
$1XTEENTH AMENDKINT OF AG'REEKZNT rot J0!NT CWNttSH!P, CONSTRUCT!ON AND OPERATION OF NEW RAMPSHIRE NUCLEAR yNt;g
)
This sixteenth Amendment to Agreement for Joint ! Ownership. Construction and Operation of New Hampshire Nuclear Units (the " Sixteenth Amendment") made as cf th's 15th day of June. 1984. by and among Public Service Company of New Hampshire ("PSRH"). i, The United Illuminating Company. Sanger Hydro. Electric Company Central Maine Power Company. Central 5 Vermont Public Service Corporation. Canal Eler' tic Company (successet in interest to New Bedford Gas and Edison Light Company). ] The Connecticut Light and Power Company. Fitch, burg ' Cas & tiectric Light Company. Hudson Light & Power Department. ' Maine Public Service Company. Massachusetts Municipal Wholesale Electric Company. Montaup Electric company. New England Power Company. New Hampshire Electric Cooperative.-Inc.. Taunton Municipal Lighting Plant, and Vermont Electric Generation tid Transmission Cooperative. Inc. (the " Participants"). l l
- 4. When-counterparts hereof have been executed by Participants having ownership Shares aggregating at least eighty percent (40%). the provisions of this Sixteenth Amendment shall become efffetive in accordance with Paragraph 29 of the Agreement.
(Sixteenth Amendment becama effective June 15. 1984) . O .
SEVENTEENTH AMENDMENT' TO AGREEMENT TOR J0!NT CRNERSHIP, CONSTRUCTION AND CPERATION OF NEW HAMPSHIRE NUCI. EAR tNfy [ \. .
! ). This Seventeenth Amendment to Agreement for Joint Ownership, Construction and Operation of New Hampshire Nacitar Units (the " Seventeenth Amendment') made as of the 6th day of March, [985,byandamongPublicServiceCompanyofNew Hampshire, The United Illuminating Company, Bangor Hydro-Electric company, Central Maine Power Company, Central Vermont Public Service Corporation, Canal Electric Company (successor l in interest to New Bedford Gas and Edison Light Company), The Connecticut Light and Power Company, Titchburg Gas & Electric Light-Company, Hudson Light & Power Department, Maine Public 2 Service Company, Massachusetts Municipal Wholescle Electric l Company, Montaup Electric Company, New England Power Company, l New Hampshire Electric Coopet'ative, Inc.. Tauntan Municipal 1
Lighting Plant, and Vermont Electric Generation and V. Transmission Cooperative, Inc. (the "Participsnts"). l
-l l
l l l (Seventeenth Amendment became ef fective March 8,1985) I fJ l l l l l
\
E!CHTEEN~M AMENDMENT OF-ACREEMENT TCR JOINT OWNERSHIP, CONSTRUCTICN AND OPERAT!CN OF NEW RAMPSHIRE NUOLEAR "N:TS 1 [') This Cighteenth Amendment to Agreement for Joint
-L/
Ownership, Construction and operation of New Hampshire
. Nuclear Units (the " Eighteenth Amendment") made as of the j 14th day'of March, 1966, by and among Public Service 00mpany of New Hampshire, The United :lluminating C:rpany, Banger Hydro-Electric Company, Central Maine Power Company, Oentral Vermont Public Service Corporation, Canal Electric C r.pany U l
(successor in interest to New Bedford Gas and Edison light ! Company), The Connecticut Light and Power Company, Fitchburg Gas and Electric Light. Company, Hudson Light and Power Department, Maine Public Service Company, Massachusetts Municipal Wholesale Electric Company, Montaup Electric Company, New England Power Company, New Hampshire Electric-Cooperative, Inc., Taunton Municipal Lighting Plant, and l Vermont Electric Generation and Transmission Cocperative, ' Inc. (the " Participants d).
- 2. When counterparts hereof have been executed by Participants having ownership Shares aggregating at least eighty percent (80%),-the' provisions of this Eighteenth knendment shall become effective -in accordance with i Paragraph 29.1oftheAgre/ ment.
(Eighteenth Amendment became effective March 14, 1986)
.(~h.
~ O
h!NETEENTH AME CMINT OF A7.REEMENT TOR JCIN; CWNERsH;p, CONC 0RV07:0N AND OPERAT! N CT NEW HAMPsH:Rt sv;; EAR ;g:;g This' Nineteenth Amendment ) Agreement for Joint Cwnership, Construct;en aSd Operation of New Hampbhire Nuclear' Units (the "Ninkteenth Amendment") made us of the 1st day of May, 1996, by and among Public Service 00mpany of New Hampsh;re, The Uni t e d ..,'.un.ne t;ng 0:mp any , Sanger Hydre-E'e:tr
. : 0:mpany, Centra *. Ma:ne ?:wer C:mpany. Cen ra; Verment Public Servi:e 00rporation, Canal Electric C:mpany (successor in interest to New Bedfera Cas and Edis:n LLght Company), The C nne:ti.-ut tight i.id Power Ocmpany, Tit:hturg Oas & Electric Li ht Ocepany, Eudsen Light & Power Oepartment, Maine Pub'.ac Serv 2ce Company, Massachusetts Municipal Wholesale Electric Company, Montaup Electric Company, New England Power Company, New Hampshire Electric Cooperative, Inc., Trunton Municip,,1 Lighting Plant, and Verment Electric Ger,aration and Transmission Cooperative, Inc. (the " Participants").
- 3. When counterparts hereof have been executed by
?articipants having Cwnership Shares aggregating at least eighty percent (80%), the proviriions of this Nineteenth Amendment shall becoma effective in accordance with Paragraph 29.1oftheAgreement.
(Nineteenth Amendment becan 3 ef f ective Sovember 25, 1986)
""*I!C . ITH AM'I CMINT OF A3?.IIXINT T* R J0:NT :'4:,'IRIE:7.
l
;,;NSTRUCT: ff UC *?!?AT :N T NI'd EA.S $2: AI :,"l:LI;. A .*::::
( , This Twentieth Amend:ent :o At:ee:en f:: J: n: '.n e : s h i p .
- enstruction and 0;e:sti:n :t New Eampshire Nucles: "ni:s ;;he
"':ventieth A=endment") made as :! the 19th day Of Se;:e ter, 1986, by and a::ng Pub'.i: Se:vt:e *: ;any ! New Ea:; shire, the inited Illuminating ::n;&ny, Iang:: Eyd::-I;e:: i: ::n;any
'"3EI"), Cent:a1 Maint P:ve: :::;a.,y (";MP"), :ent:11 Ye::::,:
Public Servi:e :::;orati:n :";Y?S"), : anal Ilect:i: :::;a..y (ruccess:: in interes :: New Bedf::d Gas and Edis:n Ligh: At:;dhy) , Th. 0:nne::i:u: Lign ant ? ve: :::pany, Irt:hbu:t Gas ( Ilect:i, Light C: any (" Tit:hhu:g"), Eudsen Ligh: L i Power Oejatt:en:, Maine ?ubli: Servi e ::=pany ("XPS "), Massachusetts Municipal .iholesale Ele:::i: ::=;any Mentau; Electric C =pany, New England P:we: :: pany. New Ea=; shire Electric C: ope:ative, :n:., Taunt:n Municipal Lighting Plant, g and Vern:n: Ele:::ic Generation and 7:ans issi:n Co;;erative, Inc. (the f :egsing pa: ies ::gether wi:h thei: ; tete:essn:s and-successors in interest (other than ICA P ve: :::;c:1-i:n), if any, are he:einafter referred : as the "Pa::ici; ants") and I7A Power Corpo:ation (";7A P ve:").
- 2. EUA Power hereby agrees that, upon the closing Of the t:ansactions contemplated by any Purchase . Sale Ag:ee:ent, it will be substituted for ge Oeparting Participan: party to such Purchase and Sale Agree:ent in 411 respects under and as a party to, and shall be bound by and expressly subject to all provisions of, any and all agree =ents relating to th'e ownership, construction and operati:r, of the inits, including
o Notwithstanding the gene:ality of the f::egeing. I"A P:ver d:es
~
net ag:ne te asse:e and I"A P:ver shall n:: he requi:ed to ;ay.
;e:!::= :: dis:ht:gt (i) any judgzonts, da: ages or awards I
against any Of the Oe;4::ing Parti:i; ants aris;ng :u: :f 11: iga:i:n with res;e:: :: the :vnership, ::tstru::::n ::
- erati
- n :f Phe *Jnits filed ;;i:: :: February *.9. 1986 vi:n
- es;e:: it SEI, ;MP, ;775 and M250, a.Md A;:i1 !. '
. i f t V;:..
res;e:: to Tit:aburg, even th: ugh such ;utg=ents, f amages :: awards a:e entered thereafter. :: (ii) the Oi;& ting Parti:ipants' tbligati:ns. if any. :n :u: standing ;o.luti:n j ::nt::1 notes; all :! which shal' :e ain the :b'.igati:n :f :..e l Oeparting ?a::::ipant which, On :ne date b,ere:f. is Ob*igated thereen.
- 3. Effe iveness. 'a' hen this Twentieth Amend:ent has been exe:uted and delivered by Pa::iti; ants having Ovnership Sha:es (as defined in the J:in: Cwnership Agreenent) aggregating a 1-least eighty percent (80%), it shall heceme, effective against and shall bind them.
Its effect as to the other Participants shall be governed by 7 ragraph 29.1 of the Joint owners' hip Agreement. No amendment of any provision of this Twentieth Amendment shall be effective against any Romaining Participant, Departing Participant or EUA Power absent its express written consent.
/
(~ twentieth Amendment became effective November 25, 1986) 1
i. O j TWENTY-TIRST AMENDMENT OT AGREEMENT Tch JOINT CWNERSHIP, CONSTRUCTION AND OPERATION or NEW RAMPSHIRE RUCLFAR UNITE This Twenty-First Amendment, made as of the 12th day of l November, 1987, by and among Public Service Company of New Hampshire, The United Illuminating Company, Canal Electric Company, The Connecticut Light and Power Company, Hudson Light & Power Department, Massachusetts Municipal Wholesale Electric Company, Montaup Electric company, New England Power Company, New Hampshire Electric Cooper.tive, Inc., Taunton Municipal Lighting Plant, Vermont Electric Generation and Transmission Cooper =? Ave, Inc. and EUA Power Corporation (the
" Participants"). . () As of the date indicated above, counterparts hereof had !
been execrts by Participants having ownership Shares aggregatir.- at least eighty percent (80%) and in accordance with Paragraph 29.1 et the Agreement'the previsions of this Twenty-First Amendment shall become effective. 1 0 f w m w .~ - , - . ,r- --
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4 l f' \ t TWENTY-TXTRD AMEHNIENT TO AGREEMENT FOR JOINT 03NERSHIP, CONSTRUCTION AND OPERATION CF NW EAMP8 HIRE NUCLEAR UNIT 5 This Twenty-Third Amendment, Etde as of the first day of November 1990, to the Agreement Por Joint Ovnership, construction And operation of New Hampshire Nuclear Units, dated as of May-1, 1973 (" Joint ovnership Agreement"), as heretofore , amended, by and among Public Service company of New Hampshire, The United Illuminating company, canal Electric company (successor in interest to New Bedford and Edison Light company),
-The Connecticut Light and Power Company, EUA Power Corporation, Massachusetts Municipal Wholesale Electric company, Montaup Electric company, New England Power company, New Hampshire
() -Electric cooperative, Inc., Taunton Municipal Lighting Plant, Hudson Light & Power Department and Vermont Electric Generation and Transmission Cooperative, Inc. (collectively, the
" Participants").
WITHESSETH THAT*
- WHEREAS, Commercial Operation of Unit No. 1 has commenced; and WHEREAS, at least eighty percent of the Participants wish to amend certain provisions of the Joint ownership Agreement I
in order to provide for funding of the operation of Unit No.-1; NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the Participants executing this Amendment hereby agree as follows: 4
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l
- 1. Amendments. The Joint ownership Agreement is hereby g
( ,) amended as follows: A. Paragraph 37.3(a) is amended by inserting the following two sentencee after the first sentences l
"Upon and after Commercial Operation of Unit No. 1, !
the Prvl tat Manager shall prepare and present the next six months' budget, quarter-ennually. The budget will be prepared on a cash basis unless the Executive Committee has voted to permit the Project Manager to prepare the budget on an accrual or modified accrual basis. In performing its function under this Paragraph 37.3, the Executive Committee shall use and be entitled to rely upon, the budget when approved or deened approved by the Participants as provided in Paragraph 37.3(c) below." B. Paragraph 37.3 (d) of the Joint ownership Agreement 73 i ,/ is hereby amended in its entirety as follows:
"37. 3 (d) (1) 9.nyratina Deoosit. After commercial Operation of Unit No.1, the Executive committee shall determine from time to time the amount (" target amount") of an operating Deposit which shall be made by aach Yarticipant nEs-rata fn accordance with its ownership share. The initial target amount shall be one month's average Project costs as determined from the approved budget for the period July through December 1990 and funded in accordance with the operating Deposit Punding Schedule (as defined in Paragraph 37.3(d) (ii) below) . The Operating Deposit g
O
. shall be held by the Disbursing Agent, together with routine monthly billing payments, maae as required in Paragraph 37.3(e) below, to provide the Project Manager with working capital sufficient to carry out the Project Manager's obligations as managing agent of the Project. The Project Manager shall recommend semi-annually (January 1 - June 30 and July 1 -
December 31) to the Executive committee the target amount for the following six months when the Project Manager presents to the Participants its "next six-months' budget". Such recommendation L shall include details of the basis and calculation of the target amount for the next six months. The target amcunt so established by the Executive committee shall in no event be greater than one andone-halfacnths'g/averageProjectcosts-asprojectedinthe next six-months' budget. The operating Deposit shall be funded consistent with the operating Deposit Funding Schedule by the Participants gro-rata in accordance with their respective ownership Shares on the first business day of each month as may be necessary, from time to time, to restore the target amount so established. The Executive Committee shall determine the schedule for funding the operating Deposit, which determination shall be binding upon all Participants. Any Participant which fails to fund its RES-IA1A share of the operating Deposit and to make payments required by Paragraph 37.3(d)(11) below shall be liable for interest on the unpaid amount at the rate provided i
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1 l elsewhere in this Agreement. The Disbursing Agent shall bill each Participant for its pr.Q-IAta share of the target amount. I such billings shall be included in the routine monthly billing made by the Disbursing Agent under Paragraph 37.3(a) hereof. Each Participant's share of the operating Deposit shall be held in escrow by the Disbursing Agent as provided in Paragraph 37.3(h) below. (ii) operatine Deeesit rundine Schedule. Each Participant shall pay its Erg-IAla share of the initial target amount of one month's average Project costs as follows: 48.2405% thereof (" initial payment") when billed by the Disbursing Agent as provided in paragraph (d)(i); and 51.7595% thereof in 18 equal ; monthly installments on the first business day of each conth, commencing on July 1, 1991 (" operating Deposit Punding schedule"). Upon dissolution of the Seabrook Preoperational and supplementary Decommissioning Trusts, each Participant shall promptly pay 51.7595% of its share of the distributions made to it from such Trusts to be applied against installments of its then unpaid EIS-IAla share of the target amount in the inverse order of when they are to become due. The initial payment by each Participant shall constitute the minimum dollar amount to be maintained by each Participant in the operating Deposit until the Participant pays its full RIS-IAtA share. Prior to December 31, 1992, the target amount shall not exceed one month's average t 6
l Project costs as provided in the then current six-months' () budget."
- c. The following new Paragraphs 37.3 (e), 37.3(f),
37.3(g) and 37.3 (h), are inserted: 837.3(e) Routine Monthly Billina. Not later than the fifteenth day of each month, or the first business day thereafter, the Disbursing Agent shall, subject to the provisions of Paragraph 37.3(f) of the Joint ownership Agreement, bill (" routine monthly billing") each Participant for its RI2-IA1A ownership Share of the estimated Project costs for the subsequent month under the then approved current six-months' budget, as established pursuant to Paragraphs 37.3(a), 37.3(b) and 37.3 (c ) above. Each invoice shall be due and payable on the first business day of the next following month. Any amount not paid on () such date shall bear interest from said due date until the date of payment at the rate provided elsewhere in this Agreement. Succeeding routine monthly billings shall set forth a reconciliation for the previous month between the estimated Project costs previously billed, including any interim payments billed pursuant to Paragraph 37.3(g) below, and the actual Project Costs incurred. Such billings also shall set forth a credit or debit to the then current routine monthly billed amount to reflect such reconciliation and interest due for late payment or other adjustments, such as vendor credits and interest. The O
- routine monthly billings shall show as debits or credits the amounts necessary to restore the operating Deposit to the target amount as set from time to time and such amounts shall be funded by the Participants as provided in Paragraph 37.3(d)(1) and (ii) above. Unless otherwise directed by the Executive Committee or provided by other provisions of this Agreement, any net interest paid by any Participant with respect to an overdue payment for any month's bill shall be credited by the Disbursing Agent pys-I.atA determined by Ownership Share to those Participants which made tit 11y payment of their bills for each such month."
"37.3(f) Soecial Provisions Re Pan ent of Proieet costs and Determination of Taract Amount. Notwithstanding the other provisions of this Paragraph 37, the following additional provisions shall apply and control with respect to payment of Project Costs *M the determination of the target amount:
(i) The Disburning Agent shall not include in a routine monthly billing for Project Costs a bill for funds for a major expenditure unless such expense is to be paid by the Disbursing Agent during the month for which the routine monthly billing is made. (ii) Tha Project Manager, on a quarterly basis, shall report to the Participants the difference, if any, between estimated Project Costs to date under the then current budget and Project Costs actually incurred to said date, together with l
estimated Project costs for the remairder of the current budget. A () If Project Costs actually incurred and Project Costs estimated for the remainder of the then current budget , exceed j 110% or are less than 90% of the estimated Project Costs in said budget, the Project Manager shall recommend to the Executive Committee that a change be made to the estimated Project costs for the remainder ofthebudge)whichchange, if approved in accordance with Paragraph 37.3(c), shall then be reflected by modification of future routine monthly billings by the Disbursing Agent. (iii) The Project Manager shall monitor and inform the Executive committee promptly of the ledger book balance of the Project as of the end of each month. If such ledger book balance is anticipated, or continues, to exceed or be less than the target amount by plus or minus 10%, the Project Manager shall () recommend to the Executive committee whether and in what amount a reduction or increase should be made in the funding for future Project costs so that the closing ledger book balance and the targot amount will be substantially the same."
"37.3(g) Interim Billinct Subject to the prior approval of the Executive Committee, the Disburning Agent may, from time to time, obtain an interim payment from each Participant by means of an Interim Billing to all Participants, for payment of unanticipated expenditures, which, in the absence of such interim payment, would result in the reduction at the end of the month of O
I the sum of ' ) the balance of the operating Deposit and (ii) the amount of funts then remaining from the routine monthly billings to the minimum required amount of $5,300,000, or less. To the artent that any Interim Billing would result in the estimated Project Costs exceeding the then current six months' budget, such Interim Billing shall require approval, in advance, as provided in paragraph 37.3(c)(1) and (ii) above. Upon receipt of the ! aforesaid required approvals, the Disbursing Agent shall without delay bill each Participant for its DIS-EatA Ovnership Share of the Interim Billing which shall be the amount necessary to !
)
restore said minimum required balance 'eo $5,300,000. -Each l Interim Billing shall be due and payable ten business days after issuance by the Disbursing Agent and any amount not paid by such date shall bear interest from said due date until the date of I (} A payment at the rate provided elsewhere in this Aareement. Each Interim Billing shall be accompanied by a letter from the Project Manager confirming the amount requested and the reason for the request. The Project Manager shall use its best efforte at all times to manage cash so as to avoid the need for interim billings."
"37.3(h) Escrowed runds. All funds held by, or under_the control of, the Disbursing Agent at any time, including without limitation, credits received from contractors, suppliers and others and all gains and interest derived from investments or t
- O
l l
. otherwise, shall at no time be property of the Participants or of the Disbursing Agent but shall be received, held and invested at all times in escrow and escrow accounts solely for the benefit of creditors of the Project, to be disbursed solely to pay each Participant's ownership share of Project costs."
D. Paragraph 29.1 (Amendment) is amended by inserting /g the following sentence at the end of the first paragraph thereof:
" Prior to December 31, 1992, theprovisionsofharagraph37 '
pertaining to the initial target amount of the operating Deposit and the operating Deposit Punding Schedule shall not be subject to any amendment, in whole or in part, or to any alter..'clon by action of the Executive Committee or Participants, cxcept upon the written consent of Participants who own in the aggregate at least 95% of the Ownership Shares of the Project.H
- 2. count erea rt s t Any number of counterparts of this Twenty-Third Amendment may be executed, and each shall have the same force and effect as an original and as if all parties to all of the counterparts had signed the same instrumen?..
- 3. Limitation of Amendments. Except as specifically amended by this Twenty-Third Amendment, the Joint Ownership Agreemei.t shall continue in full force and effect without amendment or alteration.
- 4. Effectiveness. This Twenty-Third Amendment shall become effective when duly executed and delivered by
-9~
I Participants having ownership Shares aggregating at least eighty percent (80%), at which time it shall become binding on all Participants. IN WITNESS WHEREOF, the Participants have caused this Twenty-Third Amendment to be duly executed by an authorized officer, as of the date first written above. O O ' t
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U CANAL ELECTRIC COMPANY By Title _ THE CONNECTICUT LIGHT AND POWER COMPANY By Titlet _ EUA POWER CORPORATION Dy- j 1 Titles l l HUDSON LIGHT & POWER DEPARTMENT 73, By
'%)
MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY 4 BY
Title:
MONTAUP ELECTRIC COMPANY By Titles 11 -
. i HEW ENGLAND POWER COMPANY O av
Title:
NEW MAKPSHIRE ELECTRIC COOPERATIVE By
Title:
PUBLIC SERVICE COMPANY OF NEW WJ4PSHIRE, DEBTOR AND DEBTOR-IN-POSSESSION By Title , TAUNTON MUNICIPAL LIGHTING PLANT By Titles ( THE UNITED ILLUMINATING COMPANY By _ Title VERMONT ELECTRIC GENERATION AND TRANSMISSION COOPERATIVE, INC. By
Title:
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1 - ( EXHIBIT B 4 , i. I i 4 SERVICE AGREEMENT Between
+
c NORTHEAST UTILITIES SERVICE COMPANY v and NORTH ATIANTIC ENERGY SERVICE COMPANY , L - ACTING AS-AGENT FOR THE JOINT OWNERS OF SEABROOK t t P 1 Effective as of_ _, 1991 F
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l TABLE OF CONTEh7S
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ARTICLE I Agreement to Render Services . . . . . . . . . 2 ARTICLE II Services to be Performed . . . . . . . . . . 4 ARTICLE III Agreement to Pay for Services . . . . . . . . 4 ARTICLE IV Access to Information . . . . . . . . . . . . 6 Effective Date, Termination and Modifications 7 ARTICLE V ARTICLE VI Limitation of Liability and Sot-off . . . . . 9 ARTICLE VII Assignment and Third Party Benoticiaries . . . 10 ARTICLE VIII Miscellaneous . . . . . . . . . . . . . . . . 10 EXHIBITS Exhibit A Description of Methods and Procedure for Allocating Costs of Services O
i l SERVICE AGREEMENT g- betwoon ( NORTHEAST UTILITIES SERVICE COMPANY and NORTH ATIANTIC ENERGY SERVICE COMPANY ACTING AS AGENT FOR THE JOINT OWNERS OF SEAUROOK This Agreement is made as of ___, 1991, by and betwoon NORTHEAST UTILITIES SERVICE COMPANY (*NUSCO"), a Connecticut corporation, and NORTH ATI. ANTIC ENERGY SERVICE COMPANY ("NAESCO"), a Now Hampshire corporation, acting as agent for the joint owners (the " Joint Owners") of the Seabrook nuclear generating project ("Soabrooka). WHEREAS, by order in rile No. 37-65, .he Securities and Exchange Commission ("SEC") has approved and authorized, under the Public Utility Holding Company Act of 1935 (the "Act"), the organization and conduct of business of NUSCO as a wholly owned service company subsidiary of Northeast Utilities ("NU"), a public utility holding company registered under the Act; and WHEREAS, by order in File No. , the SEC has approved and authorized, under the Act, the organization and conduct of business of NAESCO as a wholly owned electric utility and service company subsidiary of NU; and () WHEREAS, NAESCO has entered into a Managing Agent Operating Agreement (the "MADA") with the owners of an aggregate ownership share in Seabrook of 70.60921 percent, pursuant to which NAESCO has boon appointed the Managing Agent to manage, operato and maintain Seabrook Unit No. 1 and supervise the disposition of Seabrook Unit No. 2 on bohalf of the Joint Ownors offective as of tho " Time of Effectiveness" (defined as 11:59 p.m. on the last day of the calendar month in which all federal, state or local regulatory, judicial or other approvals necessary for the performance by NAESCO of its obligations as Managing Agent for Seabrook shall have becomo offectivo); and WHEREAS, Section 4 of the MADA specifically confers on NAESCO the authority to contract with an affiliated service company to act as subagent on NAESCO's behalf in performing certain of NAESCO's duties relative to the management, operation and maintenance of Soabrook Unit No. 1, and tho supervision of the disposition of Seabrook Unit No. 2; WHEREAS, pursuant to a First Amendment to the Seventh Amendmont to and Restated Agreement For Seabrook Project Disbursing Agent (" Disbursing Agent Agreement") dated as of
, 1991, between NAESCO and the Joint Owners, Joint owners with aggregate ownership shares in Seabrook of 70.60921%
have designated NAESCO as the disbursing agent for Seabrook,
~ . - --- _ _ _ _ _ _ _ _
l 2 O effective as of the Timo of Effectiveness, and NAESCO has agreed to act as disbursing agent for Soabrook; and WHEREAS, NUSCO, which rondors services to NU and its subsidiary companies, is willing to provide similar servicos to NAESCO consistent with the terms of the MAOA and the Agreement for Joint Ownership, Construction and Operation of New Hampshire Nuclear Units dated as of May 1, 1973, as amended (the "JOA"), and the Disbursing Agent Agreement; and WHEREAS, economics, increased efficiencies and other bonofits will accrue to NAESCO as a result of NUSCO rendering those services as herein provided; and WHEREAS, notwithstanding the services provided hereunder by NUSCO, NAESCO will at all times remain responsible for the management, operation and maintenanco of Seabrook NOW, THEREFORE, in consideration of the promises and of the mutual agreements heroin, it is agreed as follows: ARTICLE I Agreement to Render Services
\> Section 1.1 - In implementation of the authority granted to it in Section 4 of the MAOA, NAESCO hereby appoints NUSCO as agent on its behalf and on behalf of the Joint Owners to perform the services described in Article II hereof. To the extent requestod by NAESCO, NUSCO agrees to furnish to NAESCO upon the terms and conditions provided herein, and NAESCO agrees to use, the services described in Article II of this Agreement at such timos and for such periods as requested by NAESCO, and NUSCO will, as and to the extent required to provido such services to NAESCO, koop itself and its personnel available and competent so long as it is authorized to do so by federal and state regulatory agencies having jurisdiction.
Section 1.2 - For the purpose of providing the services soscribed in Article II of this Agreement and providing services zo the other NU subsidiaries, NUSCO has established various departments, one or more of which will participate in providing the services described in Articlo II. NUSCO reserves to itself the right, without amendment to this agreement or the express prior consent of NAESCO or the Joint owners or any other NU subsidiary to which it provides services, from time to time to establish now departments, to subdivide or otherwise reorganize any of the departments established by it or to reallocate services among various departments. (~) v
. _ _ _ . _ ____._.____.m______.__m____
,~ ~3-Section 1.3 - NUSCO will continue to furnish services to NU and NU's other subsidiaries. NUSCO also furnishes services to companies not affiliated with NU, and it may provide services to other unaffiliated companies if it determines in its own discretion that furnishing those services will not increase the cost of the services it renders to NAESCO, NU or NU's other subsidiaries. SectioAM - With the prior approval of NAESCO, which approval shall not be granted without the prior approval of the Executive Committee of the Joint Owners (the " Executive Committee") if the approval of the Executive Committee is required under the MAOA, subject to the limitations contained herein, NUSCO, in rendering the services provided herein, may arrange for the services of such executiveb, financial advisers, accountants, attorneyo, technical advisers, engineers and other contractors (collectively
- Advisers and Contractors") as it determines in its discretion are necessary or appropriate for the rendition of those services. Nothing in this Agreement or the MAOA shall be construed to require NUSCO to terminate or abrogate any contract or arrangement with an Advisor or Contractor providing services to NUSCO at the Time of Effectiveness.
7S Section 1.5 - Except for such services as are then being () provided under the Nuclear Support Services Agreement between Yankoo Atomic Electric Company and NACSCO, acting as Agent for the Joint Owners, during the term of this Agreement, NAESCO shall, prior to contracting work to others, consider giving NUSCO the opportunity to provide such work. NAESCO shall decide in each instance who shall perform such work. Epction 1.6 - NUSCO shall, at all times during the term of this Agreement, perform the services provided for in this agreement in accordance with the standard of " Prudent Utility practice." As used herein, the term " Prudent Utility Practico" shall, at a particular time, mean any of the practices, methods or acts which, in the exercise of reasonable judgment in the light of the facts known to NUSCO at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost and consistent with licensing and regulatory requirements, environmental considerations, reliability, safety and expedition and taking into account the interests of all Joint Owners. In determining whethar any practice, method or act is in accordance with Prudent Utility Practice, due consideration shall be given to the fact that the design and other aspects of the operation of nuclear electric generating units involve the application of advancing technology and are subject to changing regulatory and environmental limitations. Prudent Utility Practice is not intended to be limited to the optimum practice, () method or act to the exclusion of all others but rather to . 1
h ' l encompass a spectrum of possible practices, methods or acts, including those involving the use of new concepts or technology. Section 1.7 - NUSCO shall cooporate to the extent reasonably requested with the Oversight Committee of the Joint Owners and with the Exocutive Committoo. Section 1.Q - Whenever NUSCO is providing a service to NAESCO herounder which is subject to guidelines, direction, limitations or other provisions set forth in the MAOA, NUSCO agroes to be bound by, and shall be entitled to the benefit of, such provisions of the MAOA, subject to the other provisions of this Agreement. ARTICLE II Services to be Performed Ens;1on 2.1 - NAESCO will at all timos remain primarily responsible for the management, operation and maintenance of Seabrook. Subject to the c'ovisions of Article I of this agreement, NUSCO will prov.!e to NAESCO, to the extent requested by NAESCO, and subject at all times to the direction and control of NAESCO, the following types of services fuel planning and (~N procuremont; purchasing and stores; recommendations related to q_) the disposition or Seabrook Unit No 2; preparation of reports; corporate socrotarial functions; personnel and employee relations; accounting; taxes; insuranco; budgets; data processing; engineering and technical support; decommissioning and decontamination; nuclear waste disposal; licensing; and such other services as NAESCO may from time to time reasonably request and which NUSCO determines that it has the capability and resources to provido. ARTICLE III Acreement to Pay for Services Section 3.1 - NAESCO agrees to pay to NUSCO the cost, determined in accordance with Exhibit A attached hereto, of such services as are provided to NAESCO under the terms of this Agrooment. Such payments will include reasonable compensation for necessary capital as permitted by Rule 91 of the SEC under the Act. Enttion 3.2 - All services rendered by NUSCO under this Agreement will be at actual cost thereof, fairly and equitably allocated and calculated, all consistent with the requirements of the Act and the rules and regulations and orders thereunder. 7- Direct charges will be made for services where a direct (3j allocation of cost is possible. Charges not directly assignable, l
1 l l l 0 l l including without limitation costs of capital, shall be determined and allocated on a reasonable and equitable basis in accordance with the requirements of the Act ano as approved by NAESCO, which will not grant that approval without the prior ; approval of the Executive Committee of the Joint Owners (the i
" Executive Committee"). Neither NAESCO's nor the Executive i Committee's approval of cost allocation methods shall be unreasonably withheld. NUSCO will not be obligated to provide l services under this Agreement if the method of allocation f approved by NAESCO and the Executive Committee would be in i contravention of the Act, or the rules regulations or orders thereunder. The method of determining the cost of a particular l service and the method of allocating that cost to NAESCO and the other customer companies of NUSCO when such an allocation is necessary are set forth in Exhibit A hereto. Such allocation methods will be appropriately documented and available for review by NAESCO and the Joint Owners upon request. Without limiting the generality of the foregoing, allocable costs include executive salaries and fringe benefits paid by NUSCO, the employee wages and benefits paid by NUSCO, the insurance expensos incurred pureuant to Section 9 of the MAOA and other general overhead expenses incurred by NUSCO. NUSCO shall keep complete and accurate accounts of all receipts and expenditures hereunder Q
(_/ in accordance with the rules and regulations of the Securities and Exchange Commission and the Uniform System of Accounts prescribod for Public Utilities and Licenseos subject to the provisions of the Federal Power Act, as amended from time to time. Section 3.3 - By the twentieth day of each calendar month, or the first business day thereafter, NUSCO shall submit to NAESCO an invoice for services rondered in the previous calendar , month. All invoices submitted by NUSCO shall be prepared in accordance with Exhibit A hereto. Monthly chargos may be made in whole or in part for particular expenses on an estimated basis, subject to adjustment. Each invoice shall be payable upon presentation and not later than the (irst business day of the next following month, and any amount not paid on such date shall bear interest from the date of invoice to the dato of payment at an annual rate of two percent (2%) over the lowest (i.e. " base") rate charged, from time to time, by The First National Bank of Boston on 90-day commercial loans. Section 3.4 - All sales, use, excise, gross receipts franchise, or other similar taxes which may be applicable to the services to be performed by NUSCO for NAESCO shall be paid by NAESCO; provided, however, that no federal, state or local income tax incurred by NUSCO shall be paid by NAESCO pursuant to this gs Section or otherwise.
l
.s.
O V ARTICLE IV Access to Information Section 4.1 - NAESCO and the Joint Owners shall have the unrestricted right to all information in the control of NUSCO relating to NUSCO's performance of its obligations hereunder for the benefit of the Seabrook project (the "Seabrook Information"), wherover located, except for information which is (1) protected by law, (ii) rostricted by contract with third parties, or (iii) doomed commercially sensitive by NUSCO. If the Seabrook Information requestod is restricted by contract with third parties, NUSCO will uso its best efforts to obtain the consent of the third parties to discloso confidential Seabrook Information to NAESCO and to the Joint Owners, with the understanding that NAESCO and the Joint Owners may be required to executo a non-disclosure agreement. If NAESCO or one or more Joint Owners, requests Seabrook Information which NUSCO considors commercially sensitivo, HUSCO shall allow an independent third party, selected by the parties involved (other then NUSCO) and acceptable to NUSCO (provided that NUSCO may not unronsonably withhold its acceptance) to determino, using an informal, simplified procedure, whether the Seabrook Information in question is commercially sensitivo. In any event, if reasonable under the t N circumstancos, NUSCO may requiro NAESCO and the Joint Owner (s)
\ requesting the information to execute a non-disclosure agreement covering information considorod commercially sensitive by NUSCO.
Section 4.2 - NAESCO acknowledges, on behalf of itself and the Joint Owners, that NUSCO will be providing services to The Connecticut Light and Power Company, Public Service Company of New Hampshire and North Atlantic Energy Corporation with regard to those companies' current or future ownership interests or power entitlements in Seabrook. NUSCO and NAESCO agroo that the Seabrook Information does not include any information related solely to such services. NUSCO and NAESCO also agree that the Seabrook Information does not include any information within the possession of NUSCO related solely to NUSCO's performance of services for its customcr companies other than NAESCO or solely to NUSCO's billings for such servicos. Section 4 1 - Unless otherwise agreed among the parties involved, review of the Seabrook Information under this Article by either NAESCO or one or more Joint Owners shall occur at NUSCO's gonoral offices at reasonable times between 8 a.m. and 4 p.m. on normal business days, and shall be arranged in advance among the parties involved. NAESCO and the Joint Owners shall uso reasonable efforts to avoid disrupting NUSCO's business operations.
1 i
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l Sectinn 4.4 - Upon request by NAESCO or any Joint Owner, NUSCO, on behalf of NAESCO, s'.411 provido technical support to > NAESCO or any Joint Owner in .sgulatory proceedings and other contestod matters relative to Seabrook, including the provision 1' of vitnesses and accurate data on a timely basis. Information, including witness support, that will require a substantial commitmont of time or a substantial effort to assemble or develop, and is neither a) required by a substantial number of Joint Owners nor b) requested by the Executive Committoo, shall , be paid for by the Joint Owner (s) requesting such information. 1 NAESCO, in consultation with the Executive Committee, shall develop a reasonable standard by which it will determine how and when a Joint Owner is to be charged for information requested. Section 4.5 - Without limiting the generality of this Article IV, NAESCO, the Executive Committee and any Joint Owner may roquest an audit of the accounts and records of NUSCO relating solely to the performance of NUSCO's obligations under this Agreement at NUSCO's offices, at reasonable times, by an independent public accountant or other representative; provided that, absent extraordinary circumstances, a full-scope audit shall not be performod at the request of NAESCO, the Executivo Committee or any Joint Owner more frequently than once each (j~'s
\ year, and provided further that any such audit shall not include the right to examino any accounto or records of NUSCO which are not related to (1) NUSCO's billings to NAESCO under this Agreement, or (ii) the allocation of NUSCO's costs to NAESCO or
.Seabrook.
Smetion 4.6 - NAESCO and any Joint Owner shall have the right to review the results of such portions of internal or indopondent audit report of NUSCO as may be related to (1) NUSCO's billings to NAESCO under this Agreement or (11) the allocation of NUSCO's costs to N1 MCO or to Seabrook. Section 4.7 - NUSCO shall cooperate with the Audit Committoo of the Joint Owners and provide such support and assistance t9 the Audit Committee as may be reasonably requestod from time to time. ARTICLE V Effective Datgt Termination and Modifications Section 5.1 - The term of this Agreement shall commence at the Time of Effectiveness, provided that it has been executed by NAESCO and NUSCO, and shall continue until the date, after the cessation of commercial operation of Seabrook Unit No. 1, on I which the Joint Owners and NAESCO are ultimately relieved by the U.S. Nuclear Regulatory Commission of any further obligations
O with respect to the decommissioning of Seabrook Unit No. 1, l_ unless sooner terminated as hereinafter proviced, s l Section 5.2 - This Agreement may be terminatedt j (1) By NAESCO, without cause, following a vote of Joint Owners with at least 51% of-all ownership shares in Seabrook to terminate the MADA, providod that NAESCO gives written notice of such termination to NUSCO, which notice NAESCO i shall be obligsted to give under auch circumstances. I 1 l (ii) By NAESCO, with cause, upon written notice to
- j. HUSCO, following a vote of Joint Owners with at least 51% of all ownership shares in Seabrook to terminate this Agreement; j provided, howevur,-that NUSCO shall have a reasonable opportunity, not to exceed 90 days after the date of such notice, I to cure the failure of performance.
! (iii) By NUSCO, without cause, at any time, upon twolve months. prior notice to NAESCO and the Joint Owners, provided that
- NUSCO may not give_such notice of termination during the first i i twelve months following the Time of Effectiveness.
(iv) By NUSCO, with_cause, upon written notice to hAESCO and the Joint Owners, provided, however, that NAESCO shall O have a reasonable opportunity, not to exceed 90 days after the date of such notico,.to cure the failure of performance. Section 5.3 - Any party terminating this Agreement shall give written notice of such termination to the other party hereto, stating _the date on which termination is to occur (the
" Termination Date"). Notwithstanding such notice, the-Termination Date shall not occur until-any requisite amendment to 3' the U.S. Nuclear Regulatory Commission Operating' License-for Seabrook has been issued and is in effect. NUSCO agrees to cooperate with NAESCO to accomplish the orderly transfer of its
-responsibilities hereunder to any successor designated by NAESCO. '
Section 5.4 - If either NAESCO or NUSCO terminates this ' LAgreement,.NAESCO shall reimburse NUSCO for direct costs actually . 1 incurred resulting from such termination, unless this Agreement is terminated for willful misconduct on the part of NUSCO as described in Article VI hereof. NUSCO shall fully substantiate
- all! direct-costs actually and reasonably incurred and supply 4 supporting documentation of such costs in reasonable detail.
NUSCO shall use its best efforts to mitigate the cost's of'
- termination. Furthermore, as a precondition to any termination hereof, NAESCO shall pay to NUSCO on the Termination Date all amounts due to NUSCO hereunder and shall execute and deliver to NUSCO such-instruments as it may reasonably request which
() evidence the continuing obligations of-NAESCO and/or the Joint 4 i 4
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9 Owners in accordance with Section 11 of the MAOA and Article VI hereof. Section 5.5 - This Agreement shall also be subject to termination and shall terminate, without any action by either NUSCO or NAESCO, to the extent and from the time that performance may conflict with the Act or with any rule, regulation or order of the SEC adopted before or after the making hereof. Notwithstanding the foregoing, the parties hereto will use reasonable efforts to negotiate any amendments to this Agreement which are necessary for this Agreement to comply with the Act or any rule, regulation or order thereunder. If this Agreement is terminated under this provision, NUSCO and NAtSCO shall fulfill their obligations under Sections 5.3 and 5.4 of this Agreement. Srction 5.6 - Modifications to the terms of this Agreement, including changes in the scope of the services to be provided, may be made at any time only by written agreement between NUSCO and NAESCO and shall not be inconsistent with the requirements of the MAOA and the JOA. ARTICLE VI
~s Limitation of Liability and Set-off k/ Section 6.1 - For and in consideration of the fact that NUSCO is undertaking its responsibility for the services provided herein without compensation or charge other then recovery of its costs for those services, neither NAESCO nor any Joint Owner shall be entitled to recover from NUSCO or the directors, trustees, officers, employees, agents or affiliates of NUSCO (or the directors, trustees, officers, employees or agents of such affilistes) (collectively, the
- Protected Parties") any damages resulting from the performance or non-performance of their responsibilities hereunder or for any damage to Seabrook, any curtailment of power, or any other damages of any kind, including direct, incidental, consequential, special, indirect or punitive damages occurring during the course of the design, engineering, procurement, installation, construction, operation, maintenance, refueling or decommissioning of Seabrook or otherwise arising out of the performance or non-performance of this Agreement, unless such damages shall have resulted directly from the willful misconduct of NUSCO, or, to the extent legally attributable to NUSCO, directly from the willful misconduct of a Protected Party. Notwithstanding the above, neither NAESCO nor any Joint Owner shall be entitled to recover any such damages if such damages result from NUSCO's or a Protec+ed Party's actions or omissions that have been expressly approved in advance by the Executive Committee or by the Joint Owners.
('T V
Section 6.2 - All goods and services provided to NUSCO or NAESCO for the benefit of Seabrook by a Protected Party shall be under written contract having the same limitation on liability as abover provided, however, that the same limitation on liability shall also apply even if the goods and services are provided without written contract. Section 6.3 - The provisions of this Article VI shall apply notwithstanding any provision of this Agreement to the contrary and shall survive the expiration or termination of this Agreement. Section 6.4 - NAESCO's obligation to make payments to NUSCO hereunder is absolute and unconditional and NAESCO shall not be entitled to set off against the payments required to be made hereunder any amounts owed to it or any of the Joint Owners by NUSCO or any offiliate of NUSCO or the amount of any claim by NAESCO or any of the Joint Owners against NUSCO or any affiliate of NUSCO. Section 6.5 - All provisions of this Agreement providing for limitation of, or protection against, liability shall apply to the full extent permitted by law, regardless of fault, and shall survive either termination pursuant to this Agreement or ( cancellation. ARTICLE VII Assianment and Third Party Beneficiaries Section 7.1 - This Agreement shall be binding upon and inure to the benefit of NAESCO and NUSCO, and neither shall assign its rights or obligations hereunder without the prior written consent of the other. Section 7.2 - The provisions of this Agreement are solely for the benefit of NAESCO, NUSCO and the Joint Owners and are not intended to benefit or create rights in any third parties, except for the benefits accruing to Protected Parties under Section 6.1. ARTICLE VIII Miscellaneous Section 8.1 - This Agreement shall be governed by and construed in accordance with the laws of the State of New Hampshire regardless of any conflicts of laws provision to the contrary. SECTION 8.2 - Except as provided in Section 1.6 hereof, NO O WARRANTIES OF ANY KIND, WHETHER STATUTORY, WRITTEN, ORAL OR
i , .11-s j IMPLIED (INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE) SHALL APPLY TO THE SERVICES PERFORMED BY NUSCO HEREUNDER OR TO ANY GOODS OR i OTHER PROPERTY PROVIDED BY NUSCO IN CONNECTION WITH SUCH SERVICES. The foregoing shall not be deemed to affect in any l manner any warranties provided by other vendors or suppliers. ' section 8.3 - This Agreement, including the attached Exhibit A, constitute the entire agreement between NUSCO and 1 NAESCO governing all rights and obligations arising out of NUSCO's performance of services for NAESCO in connection with l NAESCO's management, operation and maintenance of Seabrook. Sect. ion 8.4 - This Agreement shall be subject to approval of any federal or state regulatory body whose approval is a legal prerequisite to its execution, delivery, and performance. Section 8.5 - The work performed under this Agreement shall, at all times, be in accordance with applicable federal and state laws and regulations. L Egetion 8.6 - The obligations of the Joint Owners under this Agreement are several and not joint or joint and several. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, by their respective officers thereunto duly authorized, all as of the day and year first above written. NORTHEAST UTILITIES SERVICE CONPANY By (Name) (Title) Attest: NORTH ATLANTIC ENERGY SERVICE COMPANY, as agent for the Joint Owners of Seabrook By (Name) (Title) Attest: O
1
. 1 1
Exhibit A
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([]) i EXHIBIT A DEECRIPTION OF METHODS AND PROCEDURES FOR DETERMINING COST OF SERVICES j WORK ORDERS FOR SERVICE There shall be work orders covering services to be performed by NUSCO for NAESCO. These orders, which may be either general or specific, will speci fy the nature of the services to be performed thereunder it sufficient detail that charges therefor ' may be determined as heroin provided and properly accounted for by NAESCO under the rules and regulations of the SEC and the prescribed Federal Energy-Regulatory Commission (FERC) Uniform System of Accounts. CHARGES'FOR'EERVICES' Soecific Services Charges for specific services rendered to NAESCO will be _l) . made to specific-work order numbers assigned to accumulate the N/ charges _ applicable to particular activities. These charges will be made on the bases of benefits conferred and will include both ,. -direct and indirect-costs involved in-providing the specific services and reasonable compensation for necessary capital as permitted by Rule 91 under the Act. , General Servicea Charges:for general services rendered to'NAESCO and to other NU_ system companies will be made to the a?propriate general work ; order number assigned to accumulate the c1arges applicable to '
.the particular activity. These charges will be made on the bases of-benefits conferred and will include both direct and indirect costs involved'in providing the general. services-and reasonable compensation for necessary capital as permitted by Rule 91 under- ."
the-Act. .They will be allocated fairly and equitably to the
- companies receiving such genertl services.
NATURE OF CHARGES AND METHOD OF ALLOCATION Q,treet Charges-Direct charges cormist of those costs which can practicably be recorded separatels aed identified not only by work order number- but alra as t , . , *ce, such as time reports for each ( employee,_ vehicle repvrts, invoices and other source documents.
.i,..-,.-- . . . . . . . - - - . - . . , , . - . . , ~ - - - - - . . . - - , , . . , _ , - . - , . - , . _ . - . . . - - . . . . - . _ . , , , - . . . . _ . . . . - . . - . . . <
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; l
' Exhibit A Page 2 , a (- ( Time reports will be maintained for each employee, including i
- officers, in such detail as may be appropriate for such employee I and the nature of the services performed. Employees will record j j on their time repor^= hours chargeable to the appropriate work I 3
order numbers. Indirect Charces or Overhead Ey2ponses Indirect charges or overhead expenses consist of all costs ' of NUSCO, other than cirect charges described above. These charges may be classified into the following two general I categories:
- l. GenerS1 NUSCO_ Overheads - These charges include costs wnich cannot be. identified as applicable to a particular work order number and which must be allocated to the appropriate company on a fair and equitable basis. The following items are illustrative, and not all-inclusive, of the types of :
- costs which may be so-allocated rents, office supplies and l 9xpenses; depreciation; building operation and maintenance; 1 insuranco; reasonable compensation for necessary capital; general survices, such as reprographic services, mailroom services, etc.; employee benefits, including payroll - related state and federal taxes; and othee general I
'O overh38ds.
General NUSCO overhead costs will be allocated to NAESCO and each other NU system company on the basis of the direct NUSCO payroll costs charged to each such company.
- 2. Unn-Productive Time Overheads - Lost or nonproductive time for vacations, personal time off, sickness, holidays, etc.,
of all employees.will be allocated to NAESCO and each other NU system company on the basis of NUSCO productive payroll costs charged to each such company. CHARGES TO NU SYSTEM COMPANIES Snecific Services Charges for specific services recorded in the apreopriate work order numbers, including overhead items, will be billed monthly to NAESCO. EantrAJ Services Charges for general services recorded in the appropriate work ~ order numbers, including overhead items, will be allocated among and billed monthly to NAESCO and the other NU system (~h companies on a fair and equitable basis. The basas may include, l %J E
=.
Exhibit A () Page 3 4 but are'not:necessarily limited to, revenues, payroll costs, ; customers, electric peak load, or such other bases as experience j
-may
- show will provide-a more fair and equitable allocation of charges.
BILLING Bills will be provided to NAESCO in sufficient detail so as l lto' identify the services rendered and permit _ proper accounting l distribution of the chargesLunder-the rules and regulations of 1
.the.SEC and the prescribed FERC Uniform System of Accounts. !
Detail on-thefbill-will-includes (1) the department or group /
. providing the service; (2) function or' type of service; and (3) f nature:of charges,-whether direct or indirect (overhead), !
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EXHIBIT B.5 :
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[ l l i I NUCLEAR SUPPORT SERVICES AGREEMENT l i between ! l YANKEE ATOMIC ELECTRIC COMPANY d and NORTH ATLANTIC ENERGY SERVICE COMPANY V O ACTING AS
'1 AGENT FOR THE JOINT OWNERS
- l. OF.SEABROOK STATION 4
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TABLE OF CONTENTS Page
- 1. GENERAL SCOPE OF NSD SERVICES . . . . . . . . . . . . . 2
- 2. GENERAL SCOPE OF NAESCO'S OBLIGATIONS . . . . . . . . . 3
- 3. PAYMENT FOR SERVICES . . . . . . . . . . . . . . . . . . 4
- 4. TERM, TERMINATION AND MODIFICATION . . . . . . . . . . . 6
'5. ASSIGNMENT AND THIRD PARTY BENEFICIARIES . . . . . . . . 8
- 6. INSURANCE AND INDEMNIFICATION . . .. . . . . . . . . . 8
- 7. GENERAL LIMITATIONS OF LIABILITY AND WAIVER- . . . . . . 10
- 8. ACCESS TO INFORMATION . . . . . . . . . . . . . . . . . 12
- 9. MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . 14 EXHIBIT A (D
q,/ Description of Yankee Nuclear Services Division Services 1 EXHIBIT B Determination of Cost of Service and Allocation Thereof 1 m
This Agreement is made as of , by and between YANKEE ATOMIC ELECTRIC COMPANY (Yankee), a Massachusetts r-)x (_ corporation, acting by and through its Nuclear Services Division, and NORTH-ATLANTIC ENERGY SERVICE COMPANY (NAESCO), a New Hampshire corporation, acting as agent for the joint owners of the Seabrook Station (the Joint Owners). WHEREAS, the Nuclear Services Division (NSD) was established as a division within Yankee to provide support as needed for Yankee's nuclear-fueled, electric generating plant in Rowe, Massachusetts, and the various individual nuclear projects undertaken by one or more of the 10 New England utilities who own the capital stock of Yankee (the sponsoring utilities) and their associates and affiliates and the organizations in which they may have a substantial interest; I WHEREAS, the Seabrook Station is such a nuclear project; , WHEREAS, by order in File No. 70- , the Securities and l' Exchange Commission (SEC) has approved and authorized, under the Public Utility Holding Company Act of 1935 (the Act), the organization and conduct of business of NAESCO as a wholly owned electric company and service compariy subsidiary of Northeast Utilities (NU), a public utility holding company registered under the Act; WHEREAS, NAESCO has entered into a Managing Agent Operating (r-5j) Agreement ("MAOA") with the owners of an aggregate ownership l chare in the Seabrook Station of 70.60921 percent, pursuant to which NAESCO has been appointed the managing agent for the Seabrook Station as of the " Time of Effectiveness" (defined as 11.59 p.m. on the last day of the month in which all federal, state, or local regulatory, judicial or other approvals necessary for the performance by NAESCO of its obligations as managing
-agent for the Seabrook Station shall have become effective); I WHEREAS, Section 4 of the MAOA specifically confers on NAESCO the authority to contract with an affiliated service company to act as subagent on behalf of NAESCO and on behalf of the Joint Owners to perform certain of NAESCO's duties relative
-to the management, operation and maintenance of Seabrook Unit No.
1, and the supervision of the disposition of Seabrook Unit No. 2; and WHEREAS, Yankee, through NSD, has since 1972 been providing certain services in support of, and in conjunction with, the ongoing engineering, design, licensing, construction, startup, and operation of the Seabrook Station; WHEREAS, Yankee, which currently renders services to Seabrook Station, is willing to provide similar services to NAESCO consistent with the terms of the HAOA and the Agreement _(r~') for Joint Ownership, Construction and Operation of New Hampshire
. -2~
Nuclear _ Units dated'as of May 1, 1973, as amended (the "JOA"), j
.and:the First Amendment to the Seventh Amendment to and Restated 1 Agreement for Seabrook Project Disbursing Agtnt, and NAESCO is willing to accept such services; and WHEREAS, economies, increased efficiencies and other benefits will accrue to-NAESCO as a result of Yankee rendering ,
those services as herein provide; and WHEREAS,-notwithstanding the services provided hereunder by Yankee, NAESCO_will at all times-remain responsible for the j management, operation and maintenance of Seabrook; ! NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS: ,
- 1. 1 GENERAL SCOPE OF NSD SERVICES A. In implementation of the authority granted to it in Section 4 of the HAOA, NAESCO hereby appoints Yankee as 3 agent on its behalf and on behalf of the Joint Owners j to perform the services described herein.
Yankee-shall, to the extent requested by.NAESCO,
.. ' provide, and NAESCO shall'use, various engineering, licensing, environmental, quality assurance, and other s % ; related support services for the Seabrook Station, including without limitation the services described in Exhibit A hereto, as provided for in the Annual Plan and Budget described in Section 2.A herein. In addition, subject to the availability of the NSD staff and the applicable provisions of this Agreement, Yankee shall provide such other services as may be requested by NAESCO. In providing these services, personnel of Yankee shall at all times be-subject-to the' control-and, direction of designated representatives of NAESCO.
C. In-providing services hereunder, Yankee shall utilize the capability of the NSD organization.- If requested
~
to perform services that are beyond the capability of the NSD organization, Yankee may, subject to prior written approval by NAESCO, arrange to have services provided by other contractors or consultants and manage these on behalf of NAESCO, which approval shall not'be granted by-NAESCO without the prior approval of_the executive committee of the Joint Owners ("the Executive Committee) if the approval of the Executive Committee is required under the HAOA.
1 i A U D. To maintain its expertise and to keep abreast of developing events in fields related to nuclear power and engineering, NSD shall maintain memberships on certain industry committees, codes and standards committees, and in other professional groups and organizations. Generally, these memberships are of a generic nature as to benefit all plants and will be jointly funded, thus reducing costs to all. In addition, short-lived industry groups formed to address immediate industry problems may be joined at NSD's discretion and the associated costs allocated proportionately over Yankee's service agreements, including this Agreement. In cases where the benefits of a membership are determined to be specific only to the Seabrook Station, cost will be wholly alloct ad under this agreement; provided, however, that any such membership specific only to Seabrook Station shall not be undertfn by Yankee without the prior written approval of NAESCO. E. NAESCO will at all times remain primarily responsible for the management, operation and maintenance of Seabrook.
- F. Yankee shall cooperate to the extent reasonably requested with the oversight Committee of the Joint Owners and with the Executive Committee.
2 '. GENERAL SCOPE OF NAESCO'S OBLIGATIONS A. NAESCO shall purchase support services from Yankee for Seabrook Station. Prior to September in the year preceding each calendar year during the term of this Agreement, beginning with September, 1991, NAESCO and Yankee shall establish the scope of services and manpower requirements to be supplied by Yankee hereunder during such calendar year, which support services shall be reflected in NAESCO's Annual Plan and Budget for Seabrook Station for such calendar year, and shall be subject to modification within the limits herein specified, if such Annual Plan and Budget are subsequently modified pursuant to the MAOA. In the course of formulating that Annual Plan and Budget, due consideration will be given to Yankee's need for manpower requirements which are consistent from year to year, as follows: To assist NAESCO in achieving a cost effective reorganization of the operational sunport for the Seabrook Station, NAESCO may initially [_]
\-
adjust, in 1991 (or in the year in which the Time of Effectiveness occurs), the current manpower level of
wemmusuuu uu uuuuuummusuunum umuumu meu u u muummum puumu a m m u 100.5 man-years by up to plus or minus a maximum of twenty-five (25) percent, provided that (i) Yankee and ~}} NAESCO shall have mutually discussed how the adjustments will be made on a departmental basis and (ii) Yankee is given written notica within five (5) days of the Time of Effectiveness specifying the initial adjustment. Following the receipt of such written notice, Yankee shall promptly take appropriate steps to effect staffing changes reflecting such - initial adjustment and shall complete such changes within one nundred and eighty (180) days of receipt of said notice. After said initial adjustment, if any, the amount of services to be provided by Yankee shall be consistent from year to year and shall not vary by more than plus or minus a maximum of ten (10) percent from one year to the next. B. NAESCO shall not make an initial assignment of work for the Seabrook Station to others, including affiliated companies, for services of the type being performed by NSD at the Time of Effectiveness, without prior discussion with Yankee. In addition, NAESCO shall, prior to contracting work to others, consider giving Yankee the opportunity to provide such work. NAESCO 9 shall decide in each instance who shall perform such work.
- 3. PAYMENT FOR SERVICES A. NAESCO shall pay to Yankee the cost, determined in accordance with Exhibit B attached hereto, of such services ao are provided to NAESCO under the terms of this Agreement. Such payments will include reasonable compensation for necessary capital as permitted by Rule 91 of the SEC under the Act.
B. All services rendered by Yankee under this Agreement will be at actual cost thereof, fairly and equitably allocated and calculated, all consistent with the requirements of the Act and the rules and regulations and orders thereunder. Direct charges will be made for services where a direct allocation of cost is possible. Charges not directly assignable, including without limitation costs of capital, shall be determined and allocated on a reasonable and equitable basis in accordance with the requirements of the Act and as approved by NAESCO, which will not grant that approval without the prior approval of the Executive Committee. Neither NAESCO's nor the Executive Committee's approval of cost allocation methods shall be unreasonably I
0 C'N O withheld. Yankee will not be obligated to provide t services under this Agreement if the method of allocation approvel by NAESCO and the Executive Committee would bc in contravention of the Act, or the rules, regulaticas or orders thereunder. The method of determining the cost of a particular service and the method of allocating that cost to NAESCO and'the other customer companies of Yankee when such an allocation is necassary are set forth in Exhibit B hereto. Such allocation methods will be appropriately documented and available for review by NAESCO and the Joint Owners upon request. Without limiting the generality of the foregoing, allocable costs include executive salaries and fringe benefits paid by Yankee, the employee wages and benefits paid by Yankee, insurance expenses, and other general overhead expenses incurred by Yankee. Yankee shall keep complete and accurate accounts of all receipts and expenditures hereunder in accordance with the rules and regulations of the Securities and Exchange Commission and the Uniform System of Accounts prescribed for Public Utilities and Licensees subject to the provisions'of the Federal Power Act, as amended from time to time. C. Yankee shall submit itemized invoices for services rendered to NAESCO in any calendar month by the fifteenth (15th) business day of the next calendar month. All invoices submitted by Yankee shall show a breakdown of labor and material costs including overheads with department, group, and work order cost listings. NAESCO shall pay such inecice from Yankee within thirty (30) days after receip: thereof. Any payment delayed beyond thirty (30) days after receipt by NAESCO of a monthly invoice shall bear interest from the date of invoice to the date of payrent at an annual rate of (2%) over the-lowest (i.e. " base") rate charged, from time to time, by The First National Bank of Boston on 90-day commercial loans. D. All sales, use, excise, gross receipts, franchise, or other similar taxes, which may be applicable to the services to be performed by Yankee for NAESCO, shall be. paid by NAESCO, provided, however, that no federal, state, or local income tax incurred by Yankee shall be paid by NAESCO pursuant to this paragraph or otherwise. E. NAESCO's obligation to make payments to Yankee hereunder is absolute and unconditional and NAESCO ('T shall not be entitled to set off against the payments (~) required to be made hereunder any amounts owned to it
w or any.of the Joint Owners by Yankee or any affiliate of Yankee or_the amount of any claim by NAESCO or any. of the Joint Owners against Yankee or any affiliate of l Yankee. ' l
- 4. TERM, TERMINATION AND MODIFICATION '
4 A. The Term of this Agreement shall commence at the Time of Effectiveness, provided that it has been executed by NAESCO and Yankee, and shall continue until the date,
'after the cessation of commercial operation of the Seabrook_ Station, on which the Joint Owners and NAESCO are ultimately relieved by the U.S. Nuclear Regulatory-Commission of any further obligations with respect to the decommissioning of Seabrook Unit No. 1, unless sooner terminated as hereinafter provided.
1 B. This Agreement may be terminated: (1) 'By NAESCO, without cause, following a vote of Joint Owners with at least 51 percent of all ownership shares in Seabrook Station to terminate this Agreement,-provided that Yankee is given at ' y- least two years' prior written notice and no (s) reduction in the manpower to be-provided hereunder exceeding 10 percent per year occurs during said two-year period. In the event that there is a termination of the MAOA which becomes effective - prior to the expiration of the-two-year period, then the Joint Owners shall remain responsible and liable for the performance of this. Agreement.and ' 1NAESCO'shall be_ excused from performance of1this Agreement as of-the effective date of termination : E of the-Managing Agent Operating Agreement, except for its obligations under Section 4.C and 4.D hereof. (11) By NAESCO, with causer upon written notice to Yankee, following a vote of Joint Owners with at least 51 percent of all ownership shares in . l 7 Seabrook Station to terminate this Agreement; provided, however that Yankee shall-be given a j reasonable opportunity, not to' exceed 90 days
~
after the date of-such notice, to cure the failure of performance. i (iii) By Yankee, without cause, upon two years' prior notice to NAESCO and the Joint Owners; O
h (iv) By Yankee, with cause, upon written notice to NAESCO and the Joint Owners; provided, however,
-- that NAESCO shall be given a reasonable opportunity, not to exceed 90 days after the date of such notice, to cure the failure of performance.
C. Any party terminating this Agreement shall give written notice of such termination to the other party hereto, stating the date on which termination is to occur (the
" Termination Date). Notwithstanding such notice, the Termination Date shall not occur until any requisite amendment to the U.S. Nuclear Regulatory Commission Operating License for Seabrook Station has been issued and is in effect. Yankee agrees to cooperate with NAESCO to accomplish the orderly transfer of responsibilities hereunder to any successor designated by NAESCO. On the Termination Date, as a precondition to any termination hereof, NAESCO shall pay to Yankee all amounts due hereunder and shall execute and deliver to Yankee such instruments as Yankee may reasonably request which evidence the continuing obligations of NAESCO and/or the Joint Owners in accordance with Section 11 of the MAGA and Sections 6.B and 7.B of this Agreement.
D. If either NAESCO or Yankee terminates this Agreement, NAESCO shall reimburse Yankee for direct costs actually resulting from such termination, unless this Agreement is terminated for willful misconduct on the part of Yankee as described in Section 7 hereof. Yankee shall fully substantiate all direct costs actually and reasonably incurred and supply supporting documentation of such costs in reasonable detail. Yankee shall use its best efforts to mitigate the costs of termination. E. This Agreement shall also be subject'to termination and shall terminate, without any action by either Yankee or NAESCO, to the extent and from the time that performance may conflict with the Act or with any rule, regulation or order of the SEC adopted before or after the making hereof. Notwithstanding the foregoing, the parties hereto will use reasonable efforts to negotiate any amendments to this Agreement which are necessary for this Agreement to comply with the Act or any rule, regulation or order thereunder. If this Agreement is terminated under this provision, Yankee and NAESCO shall fulfill their obligations under Sections 4.C and 4.0 of this Agreement. O
)
F. Modifications to the terms of this Agreement, including Os changes in the scope of the services to be provided, may be made at any time only by written agreement between Yankee and NAESCO and shall not be inconsistent with the requirements of the MAOA and JOA.
- 5. ASSIGNMENT AND THIRD PARTY EENEFICIARIES A. Neither Yankee nor NAESCO may assign any of its rights or obligations hereunder except with the written consent of the other.
B. The provisions of this Agreement are solely for the benefit of NAESCO, the Joint Owners, and Yankee and are not intended to benefit or create rights in any third parties, except for the benefits accruing to Protected Parties under Section 7.B of this Agreement.
- 6. INSURANCE AND INDEMNIFICATION A. Yankee shall provide and maintain the following coverages, and upon request from NAESCO, furnish certificates of the same:
- a. Workmen's Compensation Insurance with statutory limits of liability as required in any state in which Yankee may be required to pay compensation related to performance of services hereunder,
- b. Employer's Liability Insurance with limits of
$250,000 each accident.
- c. Comprehencive General Liability with not less than the following requirements:
o Bodily Injury Liability, having a combined single limit of $1,000,000 0 Property Damage Liability, having a combined single limit of $1,000,000 0 Such insurance shall name the Joint Owners and NAESCO as additional insureds as their interests may appear, o Such insurance shall provide that no material change or cancellation can be effective without thirty (30) days prior written notice to NAESCO. O
O
-9
- d. Automobile Liability, including owned, nonowned, and hired automobiles with not less chan the following requirements:
- Bodily Injury, having a combined single limit of $1,000,000
- Property Damage, having a combined single limit of $1,000,000 Such insurance shall name the Joint Owners and NAESCO as additional insureds as their interests may appear.
- Such insurance shall provide that no material change or cancellation can be effective without thirty (30) days prior written notice to NAESCO.
B. During those tin:e periods when Yankee is performing services hereunder, NAESCO, acting on behalf of the-Joint Owners, shall obtain and/or raaintain, at their ('Sg own expense, for the Seabrook Station, the following: L.)
- a. Indemnification, as contemplated by Section 170 of the Atomic Energy Act of 1954, as amended; and
- b. Nuclear Liability Insurance in such form-and in such amounts as will meet the financial protection requirements of the NRC, pursuant to Section 170 of the Atomic Energy Act of 1954, as amended, or any provisions of other federal statutes substantially related to the same subject matter.
In the event that the nuclear liability protection system contemplated by Section 170 of the Atomic Energy Act of 1954, as amended, is repealed or changed, NAESCO, acting as agent for the Joint Owners, shall use its best efforts to secure and maintain in effect, during those periods when Yankee is providing services hereunder, subctantially equivalent liability protection and indemnification agreements from governmental and/or private sources from which such coverage is available consistent with prudent utility industry practice. In the event that substantially equivalent liability protection is not provided, then Yankee shall have the right to terminate this Agreement (%g upon written notice to NAESCO, to be effective on the (_j date on which the reduction in liability protection becomes effective. Notwithstanding any provision of
w A (-) this Agreement to the contrary, Yankee shall not be liable to NAESCO or the Joint Owners or any of their insurers for any loss of, damage to, or loss of use of, any property or equipment or for injury (including death) to persons located at such plant site or in the vicinity of such plant site arising out of or resulting from a " nuclear incident."
- 7. GENERAL LIMITATIONS OF LIABILITY AllD WAIVER A. Yankee shall, at all times during the term of this Agreement, perform the services provided for in this Agreement in a professional and workmanlike manner, using well qualified and experienced personnel, and in accordance with the standard of " Prudent Utility Practice." As used herein, the term " Prudent Utility Practice" shall at a particular time mean any of the practices, methods, or acts which, in the exercise of reasonable judgment in the light of the facts known to Yankee at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost and consistent with licensing and regulatory requirements, environmental considerations, reliability, safety, and expedition and taking into 7 j3
(' account the interests of all Participants. In determining whether any practice, method, or act is in accordance with Prudent Utility Practice, due consideration shall be given to the fact that the design and other aspects of the operation of nuclear electric generating units involve the application of advancing technology and are subject to changing regulatory and environmental limitations. Prudent Utility Practice is not intended to be limited to the optimum practice, method, or act to the exclusion of all others, but rather, to be a spectrum of possible practices, methods, or acts, including those involving the use of new concepts or technology. H. For and in consideration of the fact that Yankee is tr.dertaking its responsibility for the services provided herein without compensation or charge other than recovery of its costs for those services, except to the extent of the actual proceeds of insurance provided and maintained pursuant to Section 6 hereof, neither NAESCO nor any Joint Owner shall be entitled to recover from Yankee or the directors, officers, employees, agents, or affiliates of Yankee (or the diree: ors, trustees, officers, employees, or agents of su- affiliates) (collectively, the " Protected ((~j) !attles") any damages resulting from the performance or l l
('~) nonperformance of their responsibilities hereunder or for any damage to Seabrook Station, any curtailment of power, or any other damages of any kind, including direct, incidental, consequential, special, iridirect , or punitive damages occurring during the course of the design, engineering, procurement, installation, construction, operation, maintenance, refueling, or decommissioning of Seabrook Station or otherwise arising out of the performance or nonperformance of this Agreement, unless such damages shall have resulted directly from the willful misconduct of Yankee, or, to the extent legally attributable to Yankee, directly from the willful misconduct of a Protected Party. Notwithstanding the proceding sentenco, neither NAESCO nor any Joint Owner shall be entit3ed to recover any such damages if such damages resulted from Yankee's or a Protected Party's actions or omissions that have been expressly approved in advance by the Execut.'.ve Committee or by the Joint Owners. To the extent not covered by or in excess of the insurance requirement in Section 6 hereof, NAESCO, acting on behalf of the Joint Owners, shall indemnify and hold Yankee and the Protected Parties harmless against all liability to third parties for injuries, losses, and damages occurring at Seabrook Station
/~N related to Yankee's services hereunder unless such is ,1 injuries, losses, and damages shall have resulted directly from the willful misconduct of Yankee, or to the extent legally attributable to Yankee, directly from the willful misconduct of a Protected Party.
Notwithstanding the preceding sentence, NAESCO, acting on behalf of the Joint Owners, shall indemnify and hold Yankee and the Protected Parties harmless if such injuries, losses, or damages resulted from Yankee's or a Protected Party's actions or omissions expressly approved in advance by the Executive Committee or the Joint Owners. NAESCO's obligation to indemnify and hold harmless shall apply only if and to the extent that funds are provided to NAESCO for such purpose by the Joint Owners, and NAESCO shall have no obligation to provide funds of its own for such purpose. All goods and services provided to Seabrook Station by a Protected Party shall be under written contract having the same limitation on liability as above; provided, however, that the same limitation on liability shall also apply even if the goods and services are provided without written contract. The provisions of this Section 7.B shal'1 apply notwithstanding any provision of this Agreement to the contrary and shall survive the expiration or termination of this Agreement. G V
O C. Neither NAESCO nor the Joint Owners shall be liable to Yankee for claims for direct, incidental, indirect, consequential, or other damages of any nature connected with, or resulting from, performance of this Agreement by NAESCO whether or not due to negligence by NAESCO. D. Except as may be provided in this Section 7, NO WARRANTIES OF ANY KIND, WHETHER STATUTORY, WRITTEN, ORAL, OR IMPLIED (INCLUDING WITHOUT LIMITATION WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE AND MERCHANTABILITY) SHALL APPLY TO THE SERVICES PERFORMED BY YANKEE HEREUNDER OR TO ANY GOODS OR OTHER PROPERTY PROVIDED BY YANKEE IN CONNECTION WITH SUCH SERVICES. The foregoing shall not be deemed to affect in any manner any warranties provided by other vendors or suppliers. E. All provisions of this Agreement providing for limitation of, or protection against, liability shall apply to the full extent permitted by law, regardless of fault, and shall survive either termination pursuant
~
to this Agreement or cancellation. Nothing in this (7 Agreement shall be construed as relieving Yankee of its (s,) obligations under the secondary financial protection requirements of the Price Andersor, nuclear liability protection program, or as obligating NAESCO or the Joint Owners to indemnify Yankee for any payment obligations thereunder.
- 8. ACCESS TO INFORMATION A. NAESCO and the Joint Owners shall have the unrestricted right to all information in the control of Yankee relating to its performance of its services hereunder for the benefit of Seabrook Station (the "Seabrook Information"), wherever located, except for information which is (i) protected by law, (ii) restricted by contract with third parties, or (iii) deemed commercially sensitive by Yankee. If the Seabrook Information requested is restricted by contract with third parties, Yankee will use its best efforts to obtain the consent of the third parties to disclose confidential Seabrook Information to NAESCO and to the Joint Owners, with the understanding that'NAESCO and the Joint Owners may be required to execute a nondisclosure agreement. If NAESCO or one cr more Joint Owners requests Seabrook Information which Yankee
/~ considers commercially sensitive, Yankee shall allow an k )T s Independent third party, selected by the parties
(D Q' involved (other than Yankee) and acceptable to Yankee (provided that Yankee may not unreasonably withhold its acceptance), to determine, using an informal, simplified procedure, whether the Seabrook Information in question is commercially sensitive. In any event, if reasonable under the circumstances, Yankee may require NAESCO and the Joint Owne-(s) requesting the information to execute a nondisclucure agreement covering information considered connercially sensitive by Yankee. B. Review of information under this Section 8 shall occur at Yankee's offices at 580 Main Street, Bolton, Massachusetts, at reasonable times during Yankee's normal business hours, and shall be arranged in advance among the parties involved. NAESCO and the Joint Owners shall use reasonable efforts to avoid disrupting Yankee's business operations. C. Upon request by NAESCO, Yankee shall provide technical support to any Joint Owner in regulatory proceedings and other contested matters relative to Seabrook Station, including the provision of witnesses and .((/'] accurate data on a timely basis. Information, including witness support, that will require a substantial commitment of time or a substantial effort to assemble or develop, and is neither a) required by a substantial number of Joint Owners nor b) requested by the Executive Committee, shall be paid for by the Joint Owner (s) requesting such information. NAESCO, in consultation with the Executive Committee, shall develop a reasonable standard by which it will determine how and when a Joint Owner is to be charged for information requested. D. Without limiting the generality of this Section 8, NAESCO, the Executive Committee and ony Joint Owner may request an audit of the accounts and records of Yankee relating solely to the performance of Yankee's obligations under this Agreement at Yankee's offices, at reasonable times, by an independent public accountant or other representative, provided that, absent extraordinary circumstances, a full-scope audit shall not be performed at.the request of NAESCO, the Executive Committee or any Joint Owner more frequently than once each year, and provided further that any such audit shall not include the right to examine any accounts or records of Yankee not related to (1) ("T Yankee's billings to NAESCO under this Agreement, or d
\
l
O (ii) the allocation of Yankee's costs to NAESCO or the Seabrook Project. E. NAESCO and the Joint Owners shall have the right to review the results of such portions of internal or independent audit reports of Yankee as may be reltted to (1) Yankee's billings to NAESCO under this Agreement, or (ii) the allocation of Yankee's costs ta NAESCO or the Seabrook Project. F. Yankee shall cooperate with the Audit Committee of the Joint Owners and provide such support and assistance to the Audit Committee as may be reasonably requested from time to time.
- 9. MISCELLANEOUS PROVISIONS A. This Agreement shall be governed by and construed in accordance with the laws of the State of New Hampshire.
B. This Agreement shall be subject to approval of any federal or state regulatory body whose approval is a legal prerequisite to its execution, delivery, and () performance. C. The work performed under this Agreement shall, at all times, be in accordance with applicable federal and state laws and regulations. D. This Agreement, including the attached Exhibits A and B, constitutes the entire agreement between the Parties for the services to be provided hereunder, and supersedes all prior representations and agreements, whether written or oral, between the Parties as to such services. E. This Agreement specifically supersedes in its entirety the Nuclear Support Service Agreement between Yankee and Public Service Company of New Hampshire effective as of July 1, 1983, as amended by Amendment No. 1 thereto effective as of June 1, 1985. F. The obligations of the Joint Owners under this Agreement are several and not joint or joint and several. O V
1 IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed by their respective officers thereunto duly authorized, all as of the day and year first above written. YANKEE ATOMIC ELECTRIC COMPANY By (Signature) (Typed Name) (Title) Attest (Date) NORTH ATLANTIC ENERGY SERVICE COMPANY, as agent for the Joint Owners of Seabrook Station By (signature) (Typed Name) (Title) Etest (Date) O
EXHIBIT A h Description of Yankee Nuclear Services Division Services The service available under this Agreement are those normally furnished by the Yankee Atomic Electric Company, Nuclear Services Division, in the following areas: Construction Services Environmental Engineering Services Fuel Cycle Services Computer Science Services Licensing Services Nuclear Engineering Services Operations Support Services a )
' w- Operational Quality Assurance Plant Engineering Services Operational Project Management Supervision and Administrative Service <,
s~-
o-EXHIBIT B i Determination of Cost of Service and' Allocation Thereof
~
Cost of service will be determined in accordance with the Public Utility Holding 1 Company Act of 1935 and the rules and regulations-and orders thereunder, and will include all costs of i doing business incurred by the Nuclear Services Division. I e Records will be maintained to accumulate all costs of doing business and to determine'the cost of service. These costs will include wages and salaries of-employees and related expenses such as insurance, taxes, pensions, and other employee welfare
' expenses, general administrative expenses, and rent, light, heat, telephone, supplies, and other housekeeping costs.
Charges for services rendered and related expenses and nonpersonnel expenses (e.g., use of automotive equipment, etc.) will-be billed directly to_the serviced companies, either individually or, when the services performed are for a group of companies, by means of.an equitable allocation formula. Each formula will_have an-appropriate basis such as nuclear
-capacit-les, plant investments, fuel inventories, or-operating revenues.
Charges for services will be. determined from the time sheets 4 p)- q_ 'of employees, and will be computed on the basis of each employee's hourly-rate-plus a percentage factor to cover related-expenses and general-' administrative expenses. Records of such
.related expense and general administrative expenses will be maintained and subjected to periodic review.
Out-of-pocket expenses which are incurred for the serviced
' companies will be billed at cost - Charges for nonpersonnel expenses, such'as for use of automobiles, will normally be ,
computed on-the basis-of costs.per hour _or per mile. T c r
EXHIBIT B.6 SE'ITLEMENT AGREEMENT DATED AS OP JULY 19, 1990 BETWEEN O NORTHEAST UTILITIES SERVICE COMPANY AND NEW ENGLAND POWER COMPANY Section 1: New England Power Company ("NEP") has intervened in FERC Docket Nos. EC90-10-000 et al., concerning the application of Northeast Utilities Service Company ("NUSCO") for Northeast Utilities ("NU") to acquire Public Service Company of New Hampshire ("pSNH"). On May 25, 1990, NEp submitted pre-filed testimony in that docket expressing concerns about the assumption by NU of management and operating responsibility for the Seabrook Unit No. 1 nuclear generating unit ("Seabrook") in the absence of appropriate measures to protect the interests of minority joint owners of Seabrook, includit1 NEP, and their customers. NU and NEP desire to resolve NEP's concerns and have negotiated in good faith to develop a set of terms and conditions that they believe is adequate to protect the interests of the minority ownsrs of Seabrook and their customers, as reflected in this Settlement Agreement. Section 2: Based upon NU's agreement to the terms and conditions described in Section 3, below, NEP agrees to withdraw the pre-filed testimony of-Mr. Tranen and the portions of the pre-filed direct testimony of Dr. Kamerschen addressed to NU's assumption of management and operating responsibility O ,
f 1 for-Seabrook, including specifically, the sentence boginning on 1 page 6, line 11 and ending on line 17; page 14, line 17 through l page 18, line 13; the sentence bagd.nning on page 19, line 3 and ending on line 6; and page 58, line 22 through page 7/, line 3. I NEp agrees to cooperate in good faith and use all I reasonable efforts to obtain, and not to oppose directly or indirt:Miy, the issuance of the NRC Amendment (as- defined in ] Appendix 1 hereto) and other Regulatory Approvals-(as defined l 1 in Appendix 1) on an appropriate schedule recognizing the ! 1 overriding interest of the Seabrcok Participants in maintaining i the safe, efficient and reliable operation of the plant and in assuring a smooth transition to the new operator.- NEF further agrees.that all issues related to the operation and management of the Seabrook Unit I nuclear power project, which were excluded from its Settlement Agreement with NU dated-February 24, 1990, have been resolved. NU agrees, however, that NEp may take actions related to such issues consistent with its commitment in the first sentence of this paragraph. In all other respects, NEP agrees that its commitments undertaken in the February 24, 1990 Settlement Agreement are otherwise unqualified with respect to NU's acquisition of PSNH and its transmission system and generating capacity, and those commitments remain in. full force and effect. i
c (} Section 2: In return for NEP's agreement as set forth in Section 2, above, NU accepts each of the terms and conditions set forth in the Agreement attached to this Settlement Agreement as Appendix 1. In particular, NU accepts all of the terms and conditions set forth in Appendix 1, and agrees that in negotiations with any other Seabrook joint owners, it will not agree to modifications to any of those terms and conditions with respect to any issue addressed by any of those terms and conditions, unless NEP consents to the modification. Further, MEp and NU agree that each will vote its ownership share of Seabrook, and, in the case of NU, PSNH's ownership share of Seabrook, in support of the terms and conditions set forth in Appendix 1, and in opposition to any other terms and conditions addressed to the same issues not consented to by NEP. { Section 4: Nothing in this Settlement Agreement is intended or shall be deemed to preclude or discourage any other joint owner of Seabrook from engaging in further negotiations with NU. Emption 5: NU and NEP agree that the Appendix is an integral part of this Agreement. Any modification or change to this Settlement Agreement or Appendiz attached hereto during the course of or as a result of discussions and. negotiations with others, as contemplated under Section 4, shall be by mutual agreement of NU and NEp. j
l - l IN WITNESS WHERECT, each of the undersigned has caused this Agreement to be signed on its behalf by a duly authori?.ed officer on the date indicated below. NORTHEAST UTILITIES SERVICE COMPANY Byt b Title Me A g2 A ,./ s-Dates tjele _ / 9. 191 o O NEW ENGLAND POWER COMPANY By: \u ~n Aw~ m ie, %2 m.x-Datet kub 2c.isc0 JQ O
- , , . Conformed Copy AGREEMENT This Agreement is made as of July 19, 1990, between and among North Atlantic Energy Service Company, a corporation to be organized as a wholly owned subsidiary of Northeast Utilities ("NU") and a public utility organized under the-laws of the State of New Hampshire (" Operator"), and certain signatories to the Joint Ownership Agreement referred to in Appendix 1 (the
" Signatories"). The Signatories which are signatories of the Joint Ownership Agreement collectively with the other pLeties which are from time to time signatories of the Joint Ownership Agreement are hereinafter referred to as the " Participants".
Now, therefore, in consideration of the premises and the mutual covenants contained herein, the parties hereby agree as follows:
- 1. Definitient Terms used in this Agreement are defined in Appendix 1.
- 2. Basic Understandinos The Joint Ownership Agreement sets forth rights and obligations of the Participants with respect to Seabrook Station. Paragraph 36.2 of ttle Joint Ownership Agreement permits the appointment of a managing agent by Participants owning 517. or more of the Ownership Shares. The Signatories have negotiated and agreed upon terms and conditions in Appendix 1 hereto to be included in one or more of the Joint Ownership Agreement, Managing Agent Operating Agreement, and Disbursing Agent Agreement.
O
i
., a .g. -
) 3. Commitments (a) The Signatories shall draf t on an expedited basis a Managing Agent Operating Agreement, Disbursing Agent Agreenent, and an amendment to the Joint l Ownership Agreement that include all of the terms and conditions set forth in Appendix 1 and shall execute and deliver such agreements promptly thereaf ter.
(b) Since the proposed amendment of the Joint Ownership Agreement will ! require the execution and delivery thereof by Participants owning 80?. or more of,the Ownership Shares to be in full force and effect, and until all such agreements referred to in Paragraph 3(a) above are effective, the Signatories accept each of the terms and conditions set forth in Appendix 1 and agree to be bound thereby, unless they are precluded from doing so by those . Participants which are not signatories hereto. (c) The Signatories agree to cooperate in good faith and use all T1 reasonable efforts to obtain, and not oppose directly or indirectly, the v' issuance of the NRC Amendment and other Regulatory Approvals on an appropriate schedule recognizing the overridin0 interest of the Participants in maintaining the safe, efficient and reliable operation of the Plant and in assuring a smooth transition to the new operator. Nothing in this Agreement or in Appendix 1 shall be deemed to limit or affect the rights of any Signatory to take any position in any proceeding on issuas not related to Seabrook or, except as otherwise provided in the Settlement Agreement between New England Power Company and Northeast Utilities Service Company dated as of the date hereof, to abrogate or affect the right to prosecute any position already taken by a Signatory in FERC Docket No. EC90 10 000. ' (d) Each Signatory agrees that it will vote its Ownership Shares in
. support 'of the terms and conditions set forth in Appendix 1.
J
The Signatories agree that, at such time as the Managing Agent (e) Operating Agreement, Disbursing Agent Agreement and amendment to the Joint Ownership Agreement referred to above have been executed and delivered and are all in full force and ef fect, the resolution of any inconsistency among said agreements shall be governed by the Joint Ownership Agreement as amended by the provisions set forth in Appendix 1. ,
- 4. Effectiveness The Signatories agree that although bound to the terms and conditions as set forth in Appendix 1. the Operator shall not become managing agent and operator of the Plant until 11:59 P.M. on the last day of the calendar month in which the NRC Amendment and the Regulatory Approvals shall all have become effective.
- 5. Hi scell an nous _
Nothing in this Agreement is intended or shall be deeued to pieclude (a) or discourage those Participants which are not signatories he 1.to from The carrying on further negotiations with the Operator and its affiliates. Operator and its affiliates will keep each Signatory fully informed of such negotiations. (b) This Agreement shall remain in effect until such time as the Managing Agent Operating Agreement, Disbursing Agent Agreement and amendment to the Joint Ownership Agreement referred to above have been executed and delivered and are all in full force and effect. The Signatories do not intend that this Agreement be an amendment to the Joint Ownership Agreement. ~ (c) Any number of counterparts of this Agreement may be executed and each shall have the same force and effect as an original and as if all of the Signatories to all of the counterparts had signed the same instrurhcnt.
p z'; j 4
=
1
, .1 IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be signedtonLits behalf by a duly authorized officer on the date indicated but
- as of.the date first above written.
North Atlantic Ener9y Service Company . By: Northeast Utilities Service Company, its Agent
.By: /s/ Jchn F. Opeka
Title:
' Executive Vice President Date:- July 18, 1990 ( The Connecticut Light and Power Company 1
. By: / i f.-in F. Opeka
Title:
Cxecutive Vice President Date: July 18, 1990 W l b ' Public Service Company of New Hampshire 9 By: /s/ Leon E. Haglathlin, Jr.
Title:
President and CEO Date: ' July 19, 1990 - The United 111uminating Company .j By: /s/ Richard J.,Grossi .)
Title:
President and COO Cate: . July 19,- 1990 9 t
. .s. ,m New Ei' and Power Company V
F- /s/ Jeffrey D. Tranen , Ti . Vice president Date: July 19, 1990 Can'al Electric Company By: /s/ Russell D Wright
Title:
Financial Vice President Date: July 19, 1990 Montaup Electric Company By:
Title:
Dat': EUA Power Corporation By:
Title:
Date: Massachusetts Municipal Wholesale Electric Company By:
Title:
Date: ex
'l% )b
- _ 4 _ _ . . . - .
- Appendix 1 j Provisions to be included in one or core of the !
l SEABROOK JOINT OWNER $ HIP AGREEMENT (JOA), MANAGEMENT AGENT OPERATING AGREEMENT (KA0A), . < and DISBUR$1NG AGENT AGREEMENT (DAA) IND5X ' Pace 3
- l. Definitions -l 4
- 2. Basic Understandings 6
- 3. Managing Agent 7
- 4. Disbursing Agent 9
- 5. Services . .
11 6.. Contracting Authority 13 l
- 7. Executive Committee '.'
15
- 8. Oversight Committee 16
. 9. ' Audit Committee
- 10. Periodic Reporting 17 21
- 11. Access to information 23
. 12. Payments 28 1 *i . Insurance 14.. Decommissioning 29'
- 15. Limitation of. Liability ~ 29 30
- 16. Term and Effectiveness 31
- 17. No Setoff.
32
- 18. Assignment 19.-No-Third Party Beneficiaries 3P
- 20. Several Obligations 'of Participants 32- .
- 21. Applicable Law 32.
33
- 22. Arbitration-
- 23. Notice's
.,4 2a. Counterparts-
. 34
'25. Amendment. '
10 . t l _=_ _ _ _ , . . _ _ , . _ _ , . . _ . . ,_. . . , , _ . . . . _ . _ , . .
1 . Appendix 1
' This Managing Agent Operating Agreement (" Agreement") is made as g
( of ., 1990, between North Atlantic Energy Service Company, a corporation to be organized as a wholly owned subsidiary of Northeast Utilities ("NU") and a public utility organized under the laws of the State of
. New Hampshire (" Operator"), and (names of signing joint owners of Seabrook)
(the " Signatories and collectively with the other parties which are from time
;o time signatories of the Joint Ownership Agreement referred to below, the '
' Participants *). (Provision for MA0A) .
Whereas, the Participants are currently the parties to the Agreement for Joint Ownership, Construction and Operation of New Hampshire Nuclear Units, dated May 1, 1973, as heretofore amended through the Twenty Second Amendment, (which agreement as from time to time amended is hereafter referred to as the
" Joint Ownership Agreement" or "JOA"), which sets forth their respective rights and obligations with respect to the nuclear electric generatipg plant
("Seabrook St$ tion" or tha " Unit" or the " Plant") which the Participants have constructed in Seabrook, Nee Hampshire, consisting of unit one and all ecmmon facilities ("Seabrook 1") which is completed and unit two ("Seabrook 2*) which (j has been cancelledt (ProvisionforHAuAjand Whereas, pur:uant to the JOA and actions taken by the Participants, management responsibility for Seabrook Station, subject to the limited oversight and direction functions of the Executive Committee described in Paragraph 37 of the JOA, currently resides in Public Service Company of New Hampshire ("PSNH"), acting through its New Hampshire Yankee Division (the.
" Division"); [ Provision for.MADA) and Whereas, pursuant to a plan of reorganization filed by Northeast Utilities Service Company b bankruptcy case No. 88 0043 pending in the United States Bankruptcy Court for the District of New Hampshire with respect to PSNH, it is contemplated tl..t PSNH will become a wholly owned subsidiary of NU, and that P'SNH's Ownership Share of Seabrod St* tion (the "Seabrook' Interest") will be transferred to a subsidit.ry of NU to be known as North Atlantic Energy Corporation ("NAEC") (Provision for MA0A) and Q)l 9
. 2 .
Appendix 1 Whereas, Paragraph 36.2 of the JOA permits the appointment by Participants q owning $1% or more of the Ownership Shares of Seabrook Station of a managing V agent to act on behalf of all the Participants in the management of the operations of the Seabrooh Station; and it is intended that this Agreement I implement Paragraph 36.2 of the JOA; [ Provision for MA0A) and Whereas, Paragraph 35.1 of the JOA permits the appointment by Participants owning 51% or more of the Ownership Shares of Seabrook Station of a disbursing agenttoreceive,holdanddisbursepaymentsduefromParticipantsi(Provision forDAA)and i h Whereas, it is recognized that under the JOA the Participants are each l severally responsible for their respective Ownership Shares of the costs of operating and maintaining Seabrook 1 and of the ultimate disposition of Seabrook 2 and are entitled to their Ownership Shares of the capacity and I electric energy produced by Seabrook 1; [ Provision for MA0A) and i_ Whereas, Operator desires to assume the responsibilities of Managing Agent g for Seabrook Station on behalf of the Partu.ipants and gren io perform its 1 responsibilities and duties all ir accordance with Prudent Utility Practice
- (as defined in Paragraph 8.1 of the JOA); [ Provision for MADA) and Whereas, it is the intent of the Operator and the Signatries lo promote the safe, efficient and reliable operation of Seabrook Station (Seabrook) and the Signator_ies desire that the Operator shall have responsibility for the day to day operation and maintenance of Seabrook consistent with this goal;
[ProvisdonforMADA)and Whereas, the Signatories and the Operator desire that all Participants l shall have the unrestricted access to project information, with the limited
- restrictions set forth herein, and the Operator desires to keep the Participants regularly and fully advised of significant activities and developments; (Provision for MADA) and 4
e O 4
- d -
- Appendix !
Now, therefore,.in consideration of the premises and the mutual co contained herein, the parties hereby agree as follows: l. Definitions [ Provision for MA0A) (a) Terms defined in the JOA are used in this Agreement with the sam meanings as there provided. ' (b) The term "NRC' shall mean the United States Nuclear Regulatory Commission or anykovernmental agency or agencies whi powe,rs thereof. , P (c) The term 'NRC Licenses" shall mean all licenses relating to Seabr Station, each as from time to time in effect, issued by the NRC, including without limitation the zero power Operating Licenses, No.
.NPF 56, the low power Operating Licenses, No. NPF 67, the full p operating license, No. NPF 86, and the Construction Permit, No.
CPPR 135, with respect M Seabrook 1, the and Construction Permit CPNbl30, with respect to Seabrook 2. O V (d)'The term "NRC Amendment" shall mean the amendments to'NR which, _ inter alia, designate Operatcr as the entity technically _ qualified to operate Seabrook I and_ supervise disposal _of Seabroo
.(e) The term " Time of' Effectiveness" shall mean 11:59 P.M. on th of 15e calendar month in which the NRC Amendment, and any other federal, state or local regulatory, judicial or other approval ner,essary for the performance of this Agreement (collectively
" Regulatory Approvals"). shall all have become effective.
(f) The term " Unaffiliated Participants' shall mean those Participants which:arenotundercommoncontrol.(ProvisionforMACAan 4
- O '
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Appendix 1
- 2. Basic Understandings '
(a) (i) This Agreement relates to the transfer and delegation to Operator by the Participants of authority under the NRC Lice with respect to .the operation of Seabrook 1 and the super the disposition of Seabrook 2, which has been cancelled and abandoned by the Participants, by appointing Operator Agent pursuant to Paragraph 36.2 of the JOA. [ Provisio (ii) . The parties recognize that such transfer and delegation can onlybeaclcomplishedaftertheNRCAmendmentisissueda effective. 3. The parties agree to cooperate in good faith and use
, 'all reasonable efforts to obtain, and not oppose directly or indirectly, the issuance of the NRC Amendment and ot ;
Approvals on an appropriate schedule recognizing the ov i interest of the Participants in maintaining the safe, efficient and reliable operation of the Plant and in assuring a smooth transition to a new operator. The provisions of this Agreement relating to the-transfer and delegation of such operating authority and the exercise thereof shall become operative at the Time of Ef~fectivenest, [ProvisionforMADA] (iii)- The Operator shall use all reasonable efforts to cause the Unit to be operated in a safe, efficient and reliable manner in compliance with all applicable safety requirements, including i not limited to the technical specifications and the other terms
. and conditions of the NRC Licenses, the rules and regulations o the.NRC, and any applicable orders issued by it.-[ Provision for HA0A)
. .i (iv)
The Operator shall use all reasonable efforts to operate and l 1 maintaintheUnitinamannerthatwill(a)promotethesafetyof workers at +,ha Unit and the safety of the general publici (b) promote reliable Unit performance, high Unit availability, a low forced outage rate and short outage durations; (c) conform to al p regulatory requirements an.d binding industry standards; and i 3) l 4 l
Appendix 1 5 consistent with the goals described in the foreg (b) and (c), produce busbar costs as low ase,reaso s g) through control of operating and maintenance expense L restraint in the commitment of capital funds. (P (b) On or as soon as practicable after the Time of e Effe parties will take the following actions in order to implem transfer of authority contemplated herein: (i) PSNH shall effect the assignment to Operator of the responsibilities of the Division (as agent for Participa all outstanding contracts and agreements relating to Station which have heretofore been entered into e by PS Division either expressly or implicitly on behalf of all Participants and will cooperate with Operator in ne appropriate modificktions reflecting the shift of aut implemented hereby to any contracts relating on to Sea (suchastheNEllinsurancepolicy)whicharesubjectto requirements which preclude execution by, or ,assignment Operator (ii) as Managing Agent; (provision for MA0A] The Participants will terminate the 9Disbur;itiP A ent !g Q dated May 1,1984 as amended and direct Yankee c Ato Company (" Yankee Atomic") in its capacity as Disbu thereunder to transfer all funds and record o Oper-ator, acting as Disbursing Agent, suche funds t inthis of one or more of the accounts established pursuant Agreement. n4 t The Participants will direct Yankee Atomic to render a final accounting and reconciliationcreport wi (iii) toitsactivitiesasDisbursingAgent;(ProvisionforDAA) Operator, acting as Disbursing Agent, will open ank approp accounts on behalf of the Participants. Such accounts shall be treated in all respects as escrow accounts established e f sole benefit of Seabrook Station and shall be used s V
costs of Seabrook Station. The Operator shall not commingle any funds paid by the Participants with respect to Seabrook Station with other funds. Except as the Executive Comittee otherwise x directs, Operator will pay an obligation with respect to the Plant only if Operator has on hand funds to pay each Participsnt's Ownership Share of such obligation; (Provision for DAA) and : (iv) Subject to the reasonable direction of the Executive Comittee, 1 Operator shall assume responsibility on behalf of the Participants for all property tax negotiations with local comunities relating l to $eabrook Station facilities as to matters arising after the Time of Effectiveness. (Provistor, for MA0A)
- 3. Manacino Acent 3 (a) Commencing at the Time of Effectiveness and until the expiration or terminatiert of this Agreement. (i) the Signatories, owning collectively $17 or more of the Ownership Shares as required by j Paragraph 36.2 of the JOA, hereby designate Operator as Managing Agent '
of Seabrook Station under the JOA on b6 half of the Participants, and 7 (!!) the Participants employ Operator, and Operator herpy egre.. . (o { perform the engineering, operational and other professional services I and responsibilities of such Managing Agent on behalf of the Participants,_in accordance with this Agreement and tne JOA. Subject to the provis. ions of this Agreement wnich assign certain authority to ; the Participants and/or the Executive Comittee, the-parties agree 1 that, as Managing Agent, Operator shall have complete and ultimate 3 responsibility for day to day management of the operation of Seabrook i 1, including those duties, functions, responsibilities,_ prerogatives, j discretionary rights and authorications to act on behalf of the i Participants which are described in the 00A. Such responsibilities i
-inter alia include authority on all operational issues _respecting Seabrook 1 to the extent necessary to comply with the NRC Licenses, responsibility:for all licensing actions with respect to Seabrook 1 and ultimate-responsibility for the effective implementation of the i:
p quality assurance program at Seabrook 1. (Provision for MA0A) 9
Appendix 1 (b)' The Operator shall promptly advise the Participants of its I significant actions in discharging its responsibilities, consistent with Section 10 of this Agreement. (Provision for KA0A and JOA) (c) TheParticipantsshallapproveordisapproveinadvance,byavote of 51% or more of the Ownership Shares, the Operator's selection of the Plant's senior on-site manager. (Provision for MA0A and JOA) (d) ! The Participants shall approve or disapprove in advance, by a vote of Sly, or more of the Ownership Shares, significant government affai and pubile relations policies pertaining to,the Plant. (Provision for MA0A and JOA) (e) The Participants shall approve or disapprove in advance, by a vote of Sir. or more of the Ownership Shares, the incentive compensation programs and aggregate payments associated therewith for Operator personnel assigned to the Plant. (Provision for HA0A and JOA)
- 4. Disburs %g Agen1 (a) l Commencing at the Time of Effectiveness l Participants, owning collectively 51% or more of the Ownership Shares as recuired by i
Paragraph 35.1 of the 00A, hereby designate Operator as Disbursi Agent of Seabrook Station on behalf of the Participants. The Operator hereby agrees to perform the disbursing activities as set forth herein j and in the JOA (Provision for DAA) ' (b) The Executive Committee shall approve the significant policies and actions governing the control of funds managed by the Disbursing Agent' . This shall include, but not be limited to: (i) the selection of bank (s) in which funds are deposited. (11) the selection of any investment manager (s) utilized in administering the funds. ' l L l l
i B - Appendix 1 (iii) determination of the investment guidelines governir.g the administration of funds other than those covered under Section (~' 4(c) below. U) (iv) agreements establishing and/or governing trust funds, including butnotlimitedto,decommissioningtrusts.[ProvisionforDAA andJOA) (c) The Disbursing Agent shs1'. establish and maintain a special bank account, or accounts, with funds supplied by the Participants as required to fund their respective shares of project costs on a day to day basis. The Disbursing Agent shall endeavor to avoid carry,ing in the accounts funds in excess of a reasonable minimum balance for periods of time longer than necessary to provide for the orderly payment of invoices and payroll and other charges. Any income
-resulting from the investment of excess funds will accrue to the account of each Participant in respect to its Dwnership Share. All invoices or charges in connection with the performance of this Agreement shall be paid by the Disbursing Agent from the aferementionedaccountoraccounts.[ProvisionforDAA)
(d) After receipt of billing information from the Operator, the Disbu'rsing Agent shall prepare and submit bills to the Participants in reasonable detail for costs incurred hereunder. (Frovision for DAA) (e) The Disbursing Agent shall provide a written report monthly to the Executive Committee, with copies provided to each Participant, reflecting all activities which occurred in the particular month. Such report shall include, but not be limited to, the beginning and ending balances of funds under the control of the Disbursing Agent. (Provision for DAA) (f) The Disbursing Agent shall establish such accounts for the
, segregation of Participants' funds as shall be deemed necessary or appropriatebytheExecutiveCommittee.[ProvisionforDAA)
O
- - - _ - _ - _ _ - - - - - - - - - - - - - - - - - - - - - - - - -- ---- - -- --- ~
Appendix ; (g)
. g The Executive Committee shall at all times n the exercise of its activities of the Disbursing Agent.
responsibilities and authority e with i indemnification provisions in Paragraph g Agent 4.2 o I Agreement effect. dated May 1,1984 as amended u thall rei force and S. Services (ProvisionsinMA0A) ' Operator agrees to perforJn or cause to be perform e services and responsibilities assigned to it hereunder in conf professional standards of care and practice appropriat the technical and professional services involved e nature and of in Prudent Utility Practice (as defined in Paragraph accordance with 81 including, but not-limited to,
- of the J0A),
(a) selecting, employing, training and maintaining suffi i c ent personnel to staff Seabrook Station in accordance with licen
.g requirements applicable to the-operation of Seabrook St y on and to provide or cause to t'e provided any support operations; such services for (b) planning for nuclear fuel utilization at Seabrook 1 behalf of the Participants the requisiteerefor, nuclear fuel th l including arranging for all stages of uranium , fuel design proce '
and fabrication and eventual storage, transportation , disposition and/or reprocessing of irradiated nuclearonfuel or use of reprocessed material; s of
.and (c) purchasing and maintaining on behalf of ^the Parti i c pants, at appropriate levels, inventories of materials, supplies re parts required for operation and maintenance of Seabrook S O + - r t + s r ,r + r ge *T-me-.- v v-s * -g+. ==mei.-7.-u y -e . , + * - ,>.,y , vie--g.-vm --r --e,r-w.-r- . , - , - -ve-=e.-w-=,-.-----.-.,w--oe- w,- n *~-v- er w -t
av - Appendix 1 (d) after consultation with the Executive Committee to I - reasonably required by that Comittee pursuant to Section 7 of t , Agreement, selecting and retaining consultants and contractors assist in the performance of Operator's responsibilities with re to Seabrook Station; (e) subject to paragraphs 24.2 and 37.4(d) of the JOA and the r regarding the disposition of Seabrook 2 adopted by the Particip November 6,1986, recommending to the Participants specific a concerning the disposal of Seab*ook 2; , (f) reporting to the Executive Committee and Participants on the operations and finances of, and the insurance for Seabrook Sta accordance with Section 10 of this Agreement; and (g) taking all other actions necessary in order to keep the Op licenses and other necessary regulatory permits in full force and i effect. I Other than its responsibilities with resoect to the operation of Seabrook Station, >in carrying-out its ' obligations as Managing A
- hereunder and under the JOA, Operator may retain or appoint a se company or' agent (which service company or agent : hall be affiliate Operator) to act on its behalf and perform the responsibilities of' Operator hereunder and under the JOAr so long as such appointm
. consistent ~ with the terms 'of the Operating License and the rules an regulations of the NRC.
No such retention or appointment shall become ' effective unless the agreement (s)-' r.een the Operator and such company or agent (s) has been approved by at least three or more Unaffiliated Participants, owning collectively 60% or more of the Ownership Shares. 1- Participants shall not withhold their approval of any such agreement.if it=is fair and equitable to-all affeeted parties. , S
~ - , ~
- - . - . . . . . . . . . ~ - _ . . . - . - . - - . - - . , - , . . . , . - . - w. -- , . , ~
*H- Appendix 1
- 6. Contracting Authority (Provisions for MA04) '
' In conformity with the paragraphs 9 and 10 of the JOA and subject to
' Section 3 of this Agreement and this Section 6, the Participants hereby authorize Operator as Managing Agent to enter,into, and to execute and deliver, such contracts with third parties for design, engineering, construction and technical support services or for insyrance for Seabrook Station or for the purchase of materials, equipment and nuclear' fuel for Seabrook Station, and for the acquisition of interests (other than title) in real 4 state essential to Seabrook 3, as Operator deems necessary and prudent, provided that such contracts s, hall expressly provide that the ,
Participants are severally liable in proportion to their respective ' Ownership Shares, and neither jointly nor jointly and severally liable thereoni and provided, further, that such contracts shall provide for title to any such property which becomes a fixture or integral part of
- Seabrook Statica to pass to the respective Participants in similar proportions. Without limiting the generality of the foregoing, the Participants intend that this authorization includes authority to enter p into operating lenses for automobilss, equipant and oth6 Tacilities necessary..in Operator's opinion, to the operation of Seabrook Station or to the proper performance of Operator's'responsmitties hereunder. The ;
. Operator will use its best efforts to negotiate contracts that minimize f
indemnification and/or payment of special- and consequential damages to third parties. In-the-event that the Operator finds it necessary to provide indemnification and/or payment of special;and consequential
'd'a mages to third parties, it shall, to the extent practicable, advise the !
- Partici; ants of such condition in. advance of the execution of.such '-
agreement, in any event the -Operator shall promptly advise the Participants of such etion af ter the execution of such agreement (s).
- Neither the Operator, nor its affiliate companies, with'out the prior approval of the Executive Committee, shall enter into an agreement related to the_ project with a vendor, contractor or consultant that would require '
the Operator-or.its affiliate companies to refuse to furnish any 4 O D g m'y,g - g f sr evvi=r+- e v wyv -iT- . . - - + e r w. w- e - -- - -s<-m1 --****ev- -
,___-_- - - - ~~~~__ _ _ ---
.- ~~'~ R Appendix 1 information that could be requested by a Participant unde n
on the basis that a vendor, contractor or consultant claims such . p information to be proprietary to any such vendor, contractor or
\
consultant, provided that an agreement may provide that an which wishes to obtain any information treated as confidential or proprietary by a vendor, contractor or consultant shall sign an appropriate or consultant. nondisclosure agreement requested by such vendo L Major contracts and material modifications to such contra nuclear fuel and fuel services (excluding short term spot market pur, chases); b) employment contracts with project personne union labor contracts); c) contracts having a dollar value exce million and either presenting significant liability issues or long term (at least two years) politieni, regulatory or public re policy issuest and d) the acquisition of interests (other than t . real estate essential to Seabrook 1 shall not be executed unle in advance by Participants, owning collectively 51% or Ownership Shares. e more of th The criteria governing the types of major contracts requiring prior approval by the Participants, in additien to tho$4 specifically identified herein, may be reasonably expanded from t tim'e by the Exe ative Committee. Such additional major contracts shall be of the above. same magnitude and importance to the project as those d The Participants and Operator agree that, whether or not Opera fulfills its obligation to provide that the 'several liability of the ' Participants is referred to therein, the Participants shall be liable, and neither jointly nor jointly and severally liable, for thei respective Ownership Shares of all obligations performable, and all payments due, under or with respect to any contracts' entered into
- 3 concerning Seabrook Station executed on their behalf as conte ,
Paragraphs 9 and 10.1 of the JOA and this Section 6. ' V _
[
- 13 - Appendix 1 7, Executive Committee (Provisions for JOA*
O (a) The Executive Committee shall have general oversight 1 l responsibility for the policymaking, planning, financial, legal, political, material litigation and significant operational decisions ; of the Operator related to Seabrook which do not involve the day to day operation of the Plant. The Executive Coemittee shall at all times act reasonably in the exercise 'of such responsibilities. The limitation of liability and indemnification provisio6s in Paragraph 37.6 of the'JOA shall remain in full force and effect.
-- ( b) The Executive Committee shall also specifically and reasonably direct and ap,vove the actions of the Operator on such items as: a) ,
the resolution of discutes related to the payment of costs associated with providing information to a Participant (s) under Section 11 of. this Agreement; b) periodic reporting criteria for information ' provided to the. Participants under Section 10 of this Agreement; c) the method of cost allocation to the project by affiliate companies of
,p '
the Operater as dentibed in Section 12 of this Agieement; d)enthod of reimbursement of the Particbants for the future joint use of common facilities constructed and utilized by Seabrook 1; e) policies for-the sharing r4 Seabrook 1 equipment by units at other locatunst f) criteria fL cetermining which contracts will require Participant review or_ approval ~ as described in Section 6 of this Agreement; g) activitiesoftheOperatoractingasDisbursingAgent;h) 1 redistribution _of expenditures among budget categories as described in I Section 12 of this Agreement; and-1) negotiations with municipalities
. pertaining to property taxes. Actions of the Executive' Committee in i the exercise of any-and all of these specific responsibilities may be modified by a' vote of at least three or more Unaffiliated Participants, owning collectively 60% cr more of the Ownership Shares. : Changes in.the Executive Committee s authority to create committees and task forces may also be modified Lt a vote of at least -
three or.more Unaffiliated Participants, o'<ning collectively 60% or O
-e---.- .,-..,-..,.w.y-_,m. -m., -.~,r,-_,.sm.m.-.3%.r__my_, ,.-y--.,-,.,_,_,_,r_. .-._,w w . c m n-.g .
y,., ,,+-,---v w ----
14 *
. Appendix 1 more of the Ownership Shares. All other actions of the Executive e
Committee may be modified by a vote of Participants owning $1% or more of the Ownership Shares. All actions of the Executive Committee or modifications thereof by vote of Participants are subject to any Participant's rights to seek arbitration. (c) The by laws of the Executive Comittee may be modified from time to time by a vote of Participants owning collectively 80% of more of the'0wnership Shares.
- (d) Any Participant may request that the Chairman of the E::ecutive Committee or any two members of the Executive Committee call a meeting :,
of the Participants upon reasonable notice (which shall not be less than three business days) to discus: any matter regarding the project. Such meetings may be held by telephone conference call. All
.actjons requiring Participant review or approval shall take place at, or following, meetings of the Participants at which the particular matter was discussed. Any effort to override a vote of the Executive Committee shall be deemed a separate action which shall require a (q) <..eeting of the Participants.
. (e) The Executir committee shall be comprised of five members
- determined as follows: two members shall re;7esent investor owned Participants incorporated _ under the laws of New Hampshire; one member each shall represent investor owned Participants incorporated under
-the laws of Massachusetts and Connecticut; and one member shall represent all. municipal and cooperatively owned Participants, wherever incorporated. An investor owned Participant shall be entitled to vote only with respect to the selection of the representative of its state of incorporation. Each cooperatively. owned Participant and each municipal Participant, wherever incorporated, shall be entitled to vote to select its representative. In no event shall a Participant and its affiliates be entitled to select more than'one member of the Executive Committee.
The merters of such Executive Committee shall be . appointed from among the chief executive officers of Participants in 4
..we , ,. - n, ,.n,.-~ -,e-,,, -.w, v-, - - . . , - - , ~
15
- Appendix 1 the Units. Any member of the Executive Comittee may designate an alternate to attend and vote at any meeting of the Executive Committee in his place and stead.
- 8. Oversicht Committee [ProvisionsforJOA) '
The Executive Committee shall select or remove the members of an Oversight Committee, comprised of no more than five members at any time, which shall periodically review the activities of the Operator. Selection and removal by the Executive Committee may be modified by a Vote of at least three or more Unaffiliated Participants owning collectively 607 er more of the Ownership Shares. A mtjority of the members of the Oversight r Committee shall be comprised of individuals with st.bstantial experience in the operation or oversight of commercial nuclear power facilities. The Oversight Committee shall report to the Participants not affiliated with theOperator("NonoperatingParticipants'). The Oversight Committee shall provide to the Operator a copy of any report which it provides to the Nonoperating Participants. All costs of the Oversight Committee shall- be borne by the Nonoperating Participants based upon Ownership Shares. I Subject to Section ll(s) of this Agreement, the Operator shall cooperate fully with the Oversight' Committee in performing its duties.- I The Operator shall provide a response to any recommendations which are made by the-Oversight Committee. The Oversight Committee shall have the right to cave reasonable access'to the Plant and to observe Plant activities,-provided that these activities will not interfere with the operation of the Plant, . Plant safety or security. The Oversight Committee shall comply with all applicabi'e rules and regulations in effect at the ! Plant whether impsed by governmental authority or by the Operator. It is the intent of the Participants that at all times the Oversight Committee'act consistently with tl.s regulations-of the NRC and that there be no delegat' 'r to, nor. assumption'by, the Committee *of'any duties or authority given to the Operator or the Participants. The creation of the
~0versight Committee shall not be deemed to supersede the Operator's responsibilities under.this Agreement.
O b
16 - Appendix 1 V. Aud'it Committee (ProvisionsforJOA) ( The Audit Committee shall consist of one representative from each Participant who so elects to participate. The Chair of the Audit
. Committee shall be appointed by the Executive Committee. However, the Chair of the Audit Committee may not be a representative of any Participant which is affiliated with the Operat:r. The Audit Committee shall: .
(a) report to the Executive Committee; (b) supervise the activities of any special independent auditor which may be selected from time to time by the Executive Committee on behalf of all Participants to review the activities and records of the Operator. The Audit Committee shall make a recommendation to the Executive Committee as to the selection of the independent auditor. (c) determlM specific arets for audit as r64wiral anti develop t.r,e scope and objectives for each audit, such scope potentially involving managerial or financial topics, or both; (d) review the results of any Operator (or its affiliate) internal or independent audit reports of Seabrook Station activities; (e) at least annually review the performance of the decommissioning trustee (s) and investment manager (s). The scope of the audits subject to the review of the Audit Committee shall include all costs relating to the project. . > Subject to Section ll(a) of this Agreement, the Op'erator shall cooperate fully with the Audit Committee and any independent auditors it may retain. (Provision for Mt.0A and JOA) . O 1
_ - . . ~ . _ _ . _ - _ _ . _ _ _ _ _ _ . . _ . _ . _ - _ _ _ _ _ _ _ _ _ . . _ L -l
- 17
- Appendix 1
- - 10. Periodic Reportina [ProvisionsforMA0AandJOA)
The Operator shall meet with the Participants no less frequeritly than quarterly to report on the status of the project and discuss other matters regarding the project. Each Participant shall endeavor, in advance of the I meeting, to notify the Operator of the matters of interest to that Participant for discussion. ' i (a) For each quarterly Participants' meeting, the Operator shall distribute, at least seven days in advance, a written operational report , which shall include, but not be limited to, the following: (i) A brief summary of the Plant's operation since the last meeting of the Participants. ,. - (ii) 'A summary of Plant shutdowns and unusual load reductions since the-last meeting of the. Participants.
, l (iii) The status .of major capital projects.-The criurit genrning the projects to be reviewed shall be reasonably established from time t
to time by the Executive Committee.
-(iv) A w mmary of any NRC, U.S. Environmental Protection Agency, 9 w Hampshire Department of Environmental Protection, or OSHA violations, and the Operator's response thereto, since the last i
meeting of the Participants. ; (v) A list of the NRC elevated enforcement actions including j confirmatory action letters. enforcement conferences and
. j NRC requested management, conferences..
.- ( v i ) A summary of new significant industry concerns that have a high potential impact on the Plant that would result in significant. j increased-costs or a. Plant shutdown. q (vii) : A summary of major exposure items for the upcoming refueling- l outage.: j I
(viii) A list of other issues that the Operator believes should be brought to the Participants attention, a.g. 'related state or i local specific issues. p . !
- i t -!
18
- Appendix 1 (ix) A summary of any event at the Plant declared by the NRC to have f been an Abnormal Occurrence.
(x) A report on industrial safety, including status of the lost time accident incidence rate since the last meeting and the beginning " of the year. (xi) Other items which the Executive Committee shall, from time to <
' time, reasonably request.
At the participant meeting, the officer of the Operator with operational responsibility for the Plant shall give a" presentation on the significant items contained in the written report, at well as the current status.of_the Plant. The officer will also bri.ef the Participants on the results of evaluations and assessments of the 4 Plant by the Institute of Nuclear Power Operations. (*lNP0"), since the , last meeting of the Participants. (b) For each quarterly Participants meeting, the Operator shall distribute, at least seven days in advance, a written financial report which shall include, but not be limited to, the following: h (i) Actual operating expenses for the prior quarter and year to date comparing same to the approved budget, iho ?pereter shall explain. -in detail, all line item expenses which are budgeted to begreaterthan1%oftheOperatingBudget(asdeft'nedinSection 12 of this Agreement) and which are at variance from the approved budgets by greater than 10%.- Each report shall identify actual j o expenditures not within the approved budget and actual withholding & of expenditu m c ich have been approved. (ii) A projection a to any significant year end variances from the approved budget. The Operator _ shall explain, in detail, all line item expenditurcs which are budgeted to be greater than 1% of the Operating Budget .(as defined in Section 12 of this Agreement) and projected to be at variance from the approved budgets by greater than 10%. The Operator .shall also explain whether the total level of Operating or Capital Exp'enditures is_ expected to exce'ed the 1 respective approved budget by 5%. Each report shall identify proposed expenditures not within the' approved budget or proposed ' withholding of expenditures which have been approved.
- !l ,
-v. . . . -,. .-_..,.___..___.._._._____._..._L.-,--...._.., . - . . - _ . . . . - - . . _ , ~ -
19 - Appendix 1
. a (iii) Other items which the Executive Committee shall, from time to ! time, reasonably request.
(c) Between the quarterly Participants meetings, the Operator shall distribute, on a timely basis, operational information which shall include, but not be limited to, the following: (i) A copy of the NRC Systematic Assessment of Licensee Performance ('SALP") report, or equivalent. and the Operator's response thereto. Copies of SALP reports are to be provided as soon as 1 reasonably possible after they are released to the public by the NRC. . (ii) A copy of the year end INP0 performance indicator report, or equivalent, for the Plant. (i.ii) A copy of the Plant's post refuel outage report. (iv) A description of any event which results in a Plant shutdown or could extend a refueling shutdown by greater than two weeks. (v) A copy of the NRC report for any NRC violations in Severity Levels I, !!, or !!!, and the Operator's response thereto.
! (vi) A copy of any NRC report containing a proposed civil penalty enforcement action.
(vii) Other items which the Executive Committee shall, from time to time, r'easonably request.
.(d) -Between the quarterly Participants meetings, the Operator shall distribute, on a timely basis, financial information which shall include, but not be limited to, the following:
(i) Monthly reports which will e.iable each Participant to meet its accounting, statistical, and financial discir: sre requirements, including the requirements of any regulatory bodies having jurisdiction over such Participant. The Operator shall provide such accounting information in electronic format (i.e., magnetic tape or diskette) for those Participants which specifically request such. Subject to Section ll(a), covering une cost of providing additional information, if any Participant shall t ) - v
.. 20 -Appendir 1
- reasonably request accounting or other information required by e this Section 10 in a special or different. format, such request shall be granted to the extent prh.Ucable.
(it) Other items which the Executive Committee shall, from time to time, reasonably request. (e) Notices of an Unusual Event, Alert, Site Area Emergency, or General Emergency-(as such terms are defined in the Emergency Plans for the Plant) shall be distributed by the Operator immediately according to the Emergency Notification Procedures adopt'ed by NEPEX, or equivalent. (f) The Operator shall report, no less than quarterly, on the status ; of all decommissioning trust funds and all activity associated therewith'. -At least annually, consistent with the timing of the activities of the-New Hampshire Decommissioning: Finance Committee, or its ' equivalent. -the Operator shall issue a written report on the , l performance of +% investment manager / trustee, as well as the specific r investments c'.prising each trust fund. (g): By the.end of.the first quarter of each year, the Operstor shall-
- furnish each Participant withia detailed list of insurance policies in effect for. the Plant. Such list shall identify coverage amounts, deductibles, premiums and other relevant information. . To the extent that premiums on policies providing coverage for facilities other.than 1
the Plant'are allocated to the Plant, the Operator shall- so identify r and; fully document the basis for such allocation. The Operator shall promptly notify each Participant of any material adverse change to any-policy. (h)f 'Upon the execution of an appronriate confidentiality agreement between'.the Operator and an individual Participant, the Operator.will provide such Participant with copies of all evaluations and , assessments.of Seabrook Station and the Operator by INP0. 9 6 ! e L . L L _ - . _ _ _ ._ _ __, _ _ _ _ __ , _ _ _ , _ _ _ __
21
- Appendix 1 (i) The Operator shall report, no less than quarterly, on the status of any material litigation involving possible liability of all of the Participants in the project before any Federal or ctate court or administrative agency.
(j) Semiannuary, the Operator will furnish data showing actual performance for the plant compared to estimates ; goals contained in th* .ppr'oved Annual Seabrook Plan as described in Section 12 of this Agreement.
- 11. Access to information (ProvisionsforMA0AandJOA)
(a) Each Participant shall have the unrestricted right to all information relating to the Seabrook project including, but not limited to, records and correspondence within the control of the e, Operator, and its affiliates, wherever located eXCept for information which is a) protected by law, b) restricted by contract with third parties, or c) deemed commercially sensitive by an affiliate or
' offiliates of the Operator, if requnted information i: restricted by contract with third parties, the Operater, and its affiliates, will use its best efforts to obtain the consent of third parties to disclose confidential information to Participants, with the understanding that Participants may be required to sign a no disclosure agreement. For information which is considered commercially sensitive to an affiliate (s) of the Operator upon the request of one or more Participants, such affiliate shall allow for its review by an independent third party, selected by the parties involved (other than the Operator and its affiliates) and acceptable to the Operator (provided that Operator may not unreasonably withhold its acceptance) to determine, using an informal, simplified procedure, whether the information in question is commercially sensitive. In any event, if reasonable under the' circumstances, the' Operator may require a Participant to sign a nondisclosure agreement covering information that it considers commercially sensitive. . <J
- 22
- Appendix 1 n Review of information at the offices of the Operator, or its
() affiliate companies, shall occur at reasonable times during norsal ; business hours, and shall be arranged in advance among the involved parties. The Participants shall use reasonable efforts to avoid disrupting the business operations of the Operator or its affiliates. The Operator shall coordinatt and facilitate the dissemination of information between the project and the Executive Committee and/or the Participants. Upon request, the Operator shall assist the Participants in regulatory proceedings and other contested matters relative to the Plant, including the provision of witnesses and of current and accurate data on a timely basis, t Info-mation, including witness support, that will require a substantial commitment of time or a substantial effort to assemble or O deveien. ne 4 ne4ther > reaoiree ex Participants, nor b) requested by the Executive Comtee, snali be vest >#14 I nom 8er of paid for by the Participant (s) requesting such information. The
. Operator, in consultation with the Executive Committee, shall develop a reasonable standard by which it will determine how and when a Partic'ipant is to be charged for information requested.
Subject to the limitations set forth elsewhere in this Section 11 any information relating to the project shall be provided to any Participant requesting it, with the understanding that the_ Participant may be required to pay for the cost of providing it in the circumstances described in the preceding paragraph. (b) Without limiting the generality of this Section 11.-any Participant may request an audit of the accounts and records of tot Operator, at its offices, at reasonable times, by an independent certified accountant or otoer representative of the Participant t
+,~-.w- , - . . - , . .,-._.y -.
- - . ,, e -
- 23 - Appendix 1 requesting the auditi provided, that, absent extraordinary r~
circumstances, subject to the rights of the Participants under Section 22 (Arbitration) of this Agreement, a full scope audit shall not be performed by the Participants not affiliated with the Opetator more frequently than once each year, regardless of who makes the request or who performs the audit, if any audit is requested by the Executive Committee, the costs thereof sht11 be borne by all Participants in proportion to their Ownership Shares, if an audit is requested by one ' or more, but less than all, of the Participants, the costs thereof shall be borne by the Participant (s) making such request'. If an audit is performed in connection with an arbitration, the cost' of the audit
; shall be allocated among the Participants in accordance with the decision of the arbitrator.
(c) Each Participant shall be notified by the Operator, sufficiently in advance, of exit interview meetings with INPO, on its evaluation : report, and the NRC, on its SALP report and enforcement conferences, Representatives of any Participant may attend such meetings as g () observers. (d) Each Participant shall have the right to have its representatives visit the Plant, tour facilities, inspect project records (subject to Section ll(a) hereof) and observe Plant activities, provided that these activities will not interfere with the operation of the Plant, Plant safety or security. Such representatives shall comply with all applicable rules and regulations in effect at the Plant whether imposed by govenmental authority or by the Operator. 12, Payments
. (a) All services rendered by the Operator, or its affiliates, under this Agreement will be at actual cost thereof, fairly and equitably allocated and calculated, all consistent with the requirements of the Public Utility Holding Company Act of 1935 ("PUHCA') and the rules and regulations and orders thereunder. Direct charges will be made for ^
services where a direct allocation of cost is possible. Charges not .
' Appendix 1 24 directly assignable shall be determined and allocated on a reasonable O and equitable basis in accordance with PUHCA requirements and as approved by the Executive Committee, which approval shall not be unreasonably withheld. The Operator shall obtain Executive Committeu approval, which approval shall not be unreasonably withheld, of the rnethodology utilized, as well as changes thereto, for allocating costs to the project, prior to the implementation of such inethodology. Such ,
allocation methods will be appropriately documented and available for review by the Participants upon request. Without liditing the generality of the foregoing, allocable costs include exe'cutive salaries and fringe benefits paid by Operator, the employee wages and benefits paid by Operator, the insurance expenses incurred pursuant to Section 13 cf this Agreement, and other general overhead expenses
. incurred by Operator. The Operator shall keep complete and accurate accounts of all receipts and expenditures hereunder in accordance with the Uniferm System of Accounts prescribed for Class A s 4 Public Utilities and Licensees by the Federal Energy Regulatory Commission, ,
as amended from time to time (or such similar accounts as my pg hereafter become appropriate) (hereinaf ter the ' Uniform System of
'd Accounts").(ProvisionforMA0A]
(b) The Participants shall pay the Operator for all project costs and expenses incurred by the Operator in accordance with the JOA. , (c) In each calendar year during the term hereof, commencing with the first such year af ter the Time of Effectiveness, Operator shall prepare and present to the Executive Committee (with copies to nch Participant) the following budget information: (ProvisionforMA0Aand JOA) (i) by June 1, a five year forecast of operating and maintenance I expenses and costs of nuclear fuel, including a preliminary detailed estimated budget for the succeeding calendar year using a reasonable format selected by the E'xecutive Committee and a five year plan for the management of radioactive waste, including projected volumes, spent fuel inventory, processing P and disposal plans and estimated costs; and b 1 l.
..-.---_m________m___._ - _ _ - - _ _ _ . _ _ . _ . _ _ . _ _ _ _ _ - _ _._m_ _ _ m -. m__ _______.---.__.-_____m. - _ _ _ _ - _ .
l 25 - Appendix 1 f
, ( 11)
By Novenber 1, (a) a detailed estimated budget for operating
- and maintenance expenses and costs of nuclear foal, in a
' reasonable format selected by the Executive Committee, for the succeedingcalendaryear(the'OperatingBudget'),and(b)a six year forecast of capital expenses, including a rietailed estimated budget for capital costs for the succeeding calendar .
year (such capital budget for the succeeding calendar yetr being herein called the ' Capital Budget", and the Operating Sudget and the Capital Budget being herein called the " Annual Seabrook Budgets"); and c) a proposed annual plan which shall comprehensively address all operating goals and objectives for the Plant and its staff (" Annual Seabrook Plan") and the ba, sis thereof and shall include any planned changes in the authorized staffing level for the Plant. All expenditures that the Participants are expected to fund over the succeeding calenda" year are to be contained in the Annual Seabrook Budgets. 9 In advance of the meeting of the Participants at which the Annual ( Seabrook Budgets and Annual Seabruck Han will be consicered, the Executive Committee shall review such Annual Seabrook Budgets and ' Annual Seabrook Plan and, after consulting with the other Participants, shall confer with Operator regarding the Annual Scabrook Budgets and Annual Seabrook Plan for such calendar year. The final Annual Seabrook Budgets and Annual Seabrook Plan shall require approval by Participants owning at least an aggregate of 517..of the Ownership Shares for such year before the prior December 31, provided that if Participants owning more that 49% of the Ownership Shares do not disapprove of the the final Annual Seabrook Budgets and Annual Seabrook Plan in writing by the tenth day after the netting called and held to consider it, then the Participants shall have deemed to have approved the final Annual Seabrook Budgets and Annual Seabrook Plan. 0 .
' 26
- Appendix 1 !
1he Participants may review the' planning'and budget process and 2 request change',, The Operator shall sake every reasonable effort to implement the changes reasonably requested by tht Participants. 3 t Subsequent to approvs1 of the final Annual Seabrook Budgets, the (d) . Executive Corr?ittee may, in the reasonable exercise of its discretion, approve the redistribution of expenditures among budget categories or budget items to which the Operator shall conform, unless the Executive Committee action is overriden by a' vote of at l a least three or more Unaffiliated Participants, owning collectively 60% or more of the Ownerst),ip Shares. The Participants shall approve i or disapprove-in advance, by a vote of 51% or more of the Ownership Shar'es,. increases in Operating or Capital Expenditures if such increases are expected to result in expenditures which exceed the respective approved annual budget by 5% unless there is an immediate need to proceed in order to maintain or_ restore the unit to safe reliable operation, in which case similar Participant approval is required if such increases are expected to result in expenditures i k whid, exceed the budget b/10%, provided, howevci, that in no avant: shall the Operator fail to comply with applicable law, the NRC's rules, regulations or orde'rs, or the _ terms of thi unit's Operating t.icenses or Technical Specifications due to the need to obtain su'.h approval. The Operator will make reasonable eff' orts to mitigate expenditures-and avoid increases'in approved t$u'dget amounts. Expenditures made for the purposes of regulat#f' compliance which werenotanticipated'nthe-approvedbudgetanUwhichresultin exceeding the approved budget shall be reported by the Operator
- promptly to the Execut ve Committee. (ProvisioEfor MA0A'and JOA)-
_ The Operator shall submit to the Participants for their (e) approval, by 51% vote of the Ownership Shares, i' detailed plan and budget pertaining to all its activities covering the period from the-Q
'(
4 27 - LAppendix 1~- 6[ ..
,[ Time of Effectiveness to the end of that calendar year. Such plan
- ( ' shallibe submitted at least 60 dayyprior to the Time of b Effectiveness, and shall include, put.not be-limited to staffing changes, significant contracts whis.h the Operator proposes to r< terminate and/cr assets which it proposes to abandon and the costs
, associated therewith (Provision for HA0A]
-(f) On the fifteenth (.ay of each gnth, or the first business day-
.thereafter, commencing with the. first such date aftir the Time of'- .
Effectiveness, Operator, acting as .01sbursing Agent, shall bill each Participant for its Ownership Share.of the estimated costs under the
; applicable budget for the subsequent month. _Each statement shall be
~
.due and payable on the first day of.such subsequent month and any amountinot' paid on such date shall bear interest.from said due date
~
- until the date of payment at .an annual rate equal to the lowe'r of (1).
7% over the interest rate then being charged by. Bank'of Boston on' 90 day commercial loans or (ii) the: highest rate' permitted by law.- LL Succeeding = statements shall set forth a reconciliation for previous i months' between the estimated costs previously billed and the actual y* , costs . incur red and shall set forth a, credit :r V ' . to tne then ! L current _1y billeo amount tc reflect ;such reconciliation and interest j
~
'due for late payment or othar adju,s.tments. -Unless otherwise directed f by the Executive Committ any n,at interest paid by any Participant.
'with respect to anLoverdui. .ymentif .or 'any month's . bill'shall be credited by Operator-pro rata to.4 hose Participants which made timely L : payment of their bills for such,.mq3ti). _(Provision for:DAA_ and 00A) ,
L -!
;(g) <In the event-that. Operator:e hap g#tgined services from an affiliated company,'as contemplateA ir Section 5 of this Agreement, such affiliated company shall,, uMqn the' Executive Committee- L.
. otherwise directs, submit >billt for,,such services to Operator,s and' l
, Operator;shall in turn Dill th e Participants for such-servicJs, in- a
.accordance with this Section Ih. (Provision for MA0A and DAA, !
~'.i h .
b , ,
i a . , . 28 . - Appendix 1 1
,; u
# m .
.- < 4 , j All monies paid to Operator, as Distursing Agent, under this ,
f (h) g Agreement-and any other, including without limitation credits-j
~
, received from contractors- and gains from investments or_ interest,-_
shall: be deemed not to'be property 'of the Participants or of the y
- Operator, but shall be heifin escrow for the benefit of creditors of.
Participants-in their capacity.as .wntrs of Seabrook Station on a j j several' basis, not' joint 'or joint and several basis, or applied- to reduce future bills hereunder.' Operator will disburse monies- f s received fro,? and credited to each Participant only to pay that ] l L Participant's Ownership Share of the capital and operating costr of q the Plant.-(Provision for DAA) in the event of a dispute as to the amount.of any payment to be-(i)f
.Jmade to t'.. Operator hereunder, the Participant or Participants disputing such payment shali notify the Operator of the amount in j
dispute:and shall pay to the Operator lthe total; payr.ent including the
- disputed amounts. The Operator shall promptly refund, with interest f from=the,dat'e--of payment until the date of refund at an annual rate )
equal to the interest rate in effect from me to tirW the ;% of. Boston on;90-day commercial _ loans, any disputed amoent citimately
.found to'. not ptyable. (Provision for.MA0A and DAA]
-3
[13. nsurance (Provisions for MA0A] a R The"ParticipantsLhereby direct Operator to imolement Paragraph-10 of the JOA. , \ i ,
-The.Participantsifurther' direct Operator to.obtain-and maintain-for th'e : benefit of .its officers,. directors _and trustees while- acting -_in such y
- capacities, Directors and-OfficersSiability-Insurance in such amount as-Operatbr .may;from time to time determine, af ter consultation with the -
-j JPart_icipants, 5
l 4 t, . e
.- l_
Appendix 1
- 14. Decommissioning -[ProvisionsforMA0A]
V In furtherance of the provisions of Paragraph 13A of the 00A, the Participants hereby designate Operator as ' lead company' (as that term is defined in Chapter 162 F of the New Hampshire Revised Statutes Annotatedl and delegate to Oper:'.or authority to serve as spokesman for the , Participants, under the reasonable direction of the Executive Committee, in _ dealings with the State of New Hampshire with respect to the Seabrook. Decommissioning Financing Fund as contemplated by that statute. Operator
'shall als'o perform all.of the obligations of the Operabr under the Pre uperational Decommissioning Funding Agreement and the Seabrook; Pre Operational Decommissioning Trust Agreement, both dated as of February 11, 1989, as the same may be amended from time to time.
- 15. Emitation of Liability (Provisions for MA0A, DAA and J0A] ,
For'and in consideration of the fa t that Operator-is undertaking responsibility for design, engineering, construction, operation and maintenance of Seabrook Statiun for and on behalf ot'the rarticipa,. : (f without any compensation or charge other than recovery of its cests for such service, no Participant.shall be entitled to recover from Operator or' the directors, trustees, officers, employees, agend or affiliates of the' Operator (or the-directors, trustees, officers, employees.or agents of , such affiliates) (collectively " Protected Parties") any damages resulting l from! error, omission- or delay in the performance of its. respective I responsibilities iereunder or under the J0A, or for any damage to Seabrook Station, any curtailment of power, or any other damages of any kind,
-including consequential, special, indirect or punitive-damages occurring
~
during the course of the design, engt ieerino. pror.urement,. installment,
' construction, operation, maintenance, refueling or decommissioning _of Seabrook Station or otherwise arising out of.the performance or non performance of this Agreement, unless such damages shall'have resulted Idirectly from the wilful misconduct of the Operator, or, to the extent m r ___ ___ _ - m_ . _ _ _ . _ _ _ _ _ _ _ _ . _ _ _ _ _ _ _ _ _ _
. 30 ApNndix 1 legally attributable to the Operator, directly from the wilful misconduct of_a Protected Party, Notwithstanding the above, no Participant shall be
)
entitled to recover any such damages if such damages result from the Operator's or Protected Party's actions or omissions that have been expressly approved in advance by the Executive Committee or by the Participants. (All goods and services provided to the project by a Protected Party shall be under written contract having the same limitation of liability as above; provided, however, that the same limitation of liability shall also apply even if goods and services are provided without a written contract.) The provisions of this Section 15 shall apply notwithstanding any provision of this Agreement to the catrary and shall survive the expiration or termination of this Agreement.
- 16. Term and Effectiveress (ProvisionsforMA0A]
-() (a)
The term of this (Hanaging Agent) Agreement shall commence at the Time of Lffectiveness, provided that it has bt!en executec ev Operator and Participants owning at least 517. of the Ownership Shares of Seabrook Station, a'nd shall continue until the date, after the cessation of commercial operation of Seabrook 1, on which the Participants and Operator are ultimately relieved by the NRC of any further obligations with respect to the decommissioning of Seabrook 1, unless sooner terminated as hereinafter provided. This Ag ement may be terminated: (b) 1 (1) Bj .e Participants, et any time, with or without cause, by the affirmative vote of 51*. of all Ownership Shares. (ii) By Operator, with or without cause, upon twelve months prior notice to the Participants; provided that Operator may not give such notic.e of termination during the first twelve months following the Time of Effectiveness. c . I 1
- . -~ - - .. . -. . - . .
31 * ~ Appendix 1 C < 7-_ .- ('c) . Any party terminating this- Agreement shall give written notice l of such termination to the other pa.rties hereto, stating the date on which termination is to occur (the " Termination Date'). Notwithstanding such notice, the Termi.ution Date shall not occur until any requisite amendment to the Operating License has been issued and is in effect. Operator agrees to cooperate with the Participants to au:omplish the orderly transfer of its responsibilities hereunder to any successor designated by the - Participants. On the Termination Date, as a precondition to any
-termination hereof, the Participants shall pay to Operator all amounts .due to it hereunder and shall execute and deliver r Operat'or such instruments as it may reasonably request which evidence tha-
. contin'uing obligations of the Participants in accordance with Section 15 of this Agreement.
If the-Particioants teruinate the Operator or the Operdo'r (d) terminates :this Agreement, the Participants shall reimburse-the TT Operator for direct costs aC.ually incurred resulting from such '
~
, termination. The Operator shall fully subtetiate all direct costs' actually and reasonably incurred and supply supporting documentation i
of such costs in' reasonable detail. The Operator shall use its best
-efforts to mitigate the costs of termination.
- 17. No' Setoff -(Provisions for MA0A and DAA]-
.The Participants' ob1_igation to make payments to Operator hereunder-is absolute ano unconditional and a Participant shall not be entitled to set off again'st the' payments required to be made hereunder any amounts-owed to it by Operator or any affiliate of the Operator or by any. other-Participant or the amount of any claim by it against Operator or any affiliate of the Operator or any-other Participant.
4 4 4 h
.- .- - - . ~ . -- . .- -.._-. -. . . -
--. 3 2 '. Appendix 1-
~
. e M V
- 18. Assignment (Provisions for MA0A)
ThisL Agreement shall be_ binding upon and inure to the. benefit of
, Operator and the Participants and the' Participants' successors and assigns, subject to the limitations herein set for' 4. Operator may not assign its rights and obligations hereunder. A P- ticipant may not assign ~
. part or all of. its' interests hereur. der except- ar an integral part of a transaction involving an assignment of its Ownership Share which complies with the JOA. 1
- 19. No Third Party __ Beneficiaries [ Provisions for MA0A and DAA) ~f The provisions of this Agreement are solely. for the benefit of the parties hereto and are not intended to bonefit or create rights in any ,.
third parties. . .
- 20. _ Sevy41 Oblications of Participants (Provisions for MA0A and DAA]
/% .O. The obligations of the Participants iinder thu Areement brd any contract entered into pursuant to this Agreement shall be several and neither joint.nor-joint and several,.in proportion to the respective
- 0wnership Shares of the Participants. Every document delivered to any.
4 third party by;0perator which may bear on the nature of the: Participants' obligations 1shall specify such several.'(and not joint or joint and-several) nature of the Participants' obligations,.
- 21. Applicable Law- (Provisions for MA0A and DAA]- 1 This Agreement; is made under and shall-be governed by and interpreted in accordance with .the law of the State of-Hew Hampshire.
s 4 c ,f .
=
w w - _ , .y,, , ,ry-,-g
~
33 Appendix 11 3 22TArbitration (Provisions for MA0A and DAA] Any_ dispute among a) any of the Par'ticipants and Operator or b) any Participaat and other Participant (s) with respect to this Agree.: nt
.- (" Disputing Pantes") shall be submitted to arbitration on the request of any Disputing Party. Copies of any such request shall be served on all Participants and Operator. Such request shall specify the issue or issues in dispute and summarize the submitter's claim with respect thereto.
Within ten business days after receipt of such a request authorized representatives of the Participants and Operator shall' confer and attempt j to agre,e upon appointment of a single arbitrator. If such agreement is-not accomplished, any Disputing Party may request the American Arbitration Asscciation to appoint an arbitr. tor in accordance with its Commercial , Arbitration Rules, which rules shall govern the conduct of the arbitration in the' absence of contrary agreement by the Disputing Parties. .The
-arbitrator shall conduct a hearing in Ranchester, New Hampshire,' or at any other location mutually agreed to among the Disputing Parties, and within thirty days _thereafter, unless such time is extended by agreement by-the ci Peti =9 c rtie . sh n eetirr the e rt4c4P "t, me oeer ter 4e writ 4#9 t
.O -
'of his decision, stating his reasons for such decision and listing his findings of fact. and conclusions of. law. The arbitrator shall not have ,
power to amend or add = to this, or any other, Agreement, including the
' Joint Ownership Agreement. Subject to.such limitation, the decision of
'the arbitrator shall be final'and binding on the Disputing Parties except 1 .
'that any Disputing Party may petition a- court of competent jurisdiction 4
for review of errors of law. The decision of the arbitrator shall determine and specify how the expenses of the :rbitration shall be allocated-among the ':isputing Parties. i n-U
)
G
. Appendix 1
- 34 - .
y
- 23. Notices [ Provisions for MA0A an'd DAA) t
-Any notice, demand, or request to any Participantll be- or Operator p to any provision of this Agreement shall be made in writing and
~
delivered either_in person, by prepaid telegram, by registered or certified mail, or by telecopier, telefax, or other electronic f such- mea verification of receipt thereof to the officer, official, or agent o Participant or Operator at the address indicated on Schedule A h at such address as may hereafter be designated from time to Participant or Operator by written notice to the other Participa , Operator. 24.: Counterparts (Provision for MA0A and DAA) h
-Any number of counterparts of:this Agreement-may f the be exe shall have the same -force and effect as .an original and as if a Signatories to all of the counterparts had signed the same in
- 25. Amendment [ Provision foi MA0A and DAA)
This-Agreement may be amended from time tohip time by agree , writing executed by. Participants owning 51% or more of the Owne Shares,.except that; voting requirements P ticipantsgreater owning =suchthan 51%, c
-herein, may not be amended except in writing by ar R
greater percent of the Ownership Shares. 4 L i l , l. _4 -
- EXHIBIT D.1 NWHampshire Ted C. Feigenbewm h h preocentand C net ( m usne C W w p()
NYN 90194 November 13, 1990 United States Nuclear Regulatory Commission Washingtor, D.C. 20555 Attention: Doc ament Control Desk Refererce: Fag!!!!y Operating License No. NPF 86, Docket No. 50 443
Subject:
Application to Amend Facility Operating License No. NPF 86 to Authorize Ne'th Atlantic Energy Service Company to Act as Managing Agent for Scaerook Station, Unit No.1 Gentlemen: Pursuant to 10CFR50.90, New Hampshire Yankee (NHY) hereby submits the enclosed appe v Hn arene fr< Seabrook S:ation, Unit No.1 (Seabrook) Operating License. This ameedt at would inzlude a new entity, North Atlantic Energy Service Company (NAESCO), o as a Licensee and would authorize NAESCO, as agent for the other Licensees, to manage, L) operate and maintain Seabrook. Also enclosed with this letter is Northeast Utilities Service Company's authorization of NHY to act as their agent in regard to this application. NAESCO will be a wholly owned service company subsidiary of Northeast Utilities (NU). Its sole function will be to serve as the managing agent for Seabrook. It is proposed that NAESCO will assume this role as of the
- Time of Effectiveness" which is defined as the last day of the montt' in which NRC and all other necessary approvals have become effective.
At the Time of Efftetiveness, NHY employees will become NAESCO employees. Until then, Public Service of P ew Hampshire (PSNH), acting through New Hampshire Yankee division, will continue to be responsible for the management, operation and maintenance of Ser. brook. By separate transmittal on this date, NHY is filing another application for an amendment to the Seabrook Operating License that would allcw another wholly owned subsidiary of NU, known as the North Atlantic Energy Corporation (NAEC), to acquire and possess the ownership interest in Seabrook now possessed by PSNH. The Joint Owners, however, intcod to transfer the managing agent responsibilities from NHY to NAESCO upon receipt of all necessary approvals regardless of the status of the transfer cf the ownership interest. NHY therefore requests that NRC approval of the amendment requested herein not be contingent upon the ownership transfer. NHY has performed a safety evaluation on the proposed operating license amendment provided herein and has determined that it neither involves an Unreviewed $4fety Questian pursuant to 10CFR50.59 nor a Si 6nifir. ant Hazards Consideration pursuant to 10CFR50.92. 1" ( ' New Hompshire Yonkee Division of Publ;c Service Company of New Hompshire P.O. Box 300
- Seabrook, NH 03874
- Telephone (603) 474 952)
.3 i
-y y, , T . , _ .
m Un'ited-States Nuclear Regulatory Coramission November 13, 1990 Attentiom - Document Control Desk Page two. L Y Y-
$'d
~
The _ application and proposed amendment have also been reviewed 'and approved by the Station Operating _ Review Committee and the Nuclear Safety Audit and Review Committee. NHY has revieweil the proposed changes in accordance with the criteria specified in
~ 10CFR50.92 and has determined that the proposed changes would not:
- 1. ' involve a significant' increase in the probability or consequences of any accident previously evaluated._.. The technical qualifications =of NHY, the NU system companies and--
Yankee Atomic Electric Compsay -(YAEC) have already been approved by the NRC. There will be no changes that would adversely affect tha NRC's conclusions on the tec' u ical qualifications of _the Seabrook - management,! operating -or maintenance organteations as-docu'mented in _the Seabrook Safety _ Evaluation Report as supplemented, Further, as a result of the. proposed license amendment, there will be no physical-
~
changes to the Seabrook facility and all Limiting Conditions 1for Operation Limiting Safety
- Spiem Settings, and_ Safety Limits- specified in the- Technical Specifications will remain i i unchanged. Additionally, with _the exception of administrative changes.co reflect the_ role of NAESCO, the commitments-in the Seabrook Quality Assurance Program, and the Seabrook Emergency Plan,: Security- Plan, and: Training Program will be unaffected. Moreover, the
- license amendment :will_not result-in any changes to NHY's regulatory commitments-to the
-NRC.
2'.' Create the possibility of a new or different kind of accident from any accident - ipreviously evaluated. The Seabrook design and design bases will remain' the same. 'The
.. z current-plant safety: analyses will therefore remain complete and1 accurate in addressing de -
- licensing basis events and in analyttes plant response and consequences. ,
- The Limiting Conditions -for _ Operation, Limiting Safety System-Settings and. Safety
. Limitsifor Seabrook are notJaffected by the _ proposed license amendment. - With - the l exception of administrative _ changes to reflect the role of NAESCO, plant pece dures will be-.
unaffected.J As such, the plant conditions for which the design basis accident antlyses have - 1 , been performed-will remain valid. Therefore, the proposed license amendreent cannot create - the potsibility of a new or different kind of accident th'an previously evaluated.
- 3. Involve a reduction in a margin of safety., Plant safety margins are established
' through Limiting Conditions for_ Operation, Limiting Safety System Settings and Safety Limits
, specified in the Tschalcal Specifications, j Since there ! will, be no change to the. physical- ,
design or operation of the~ plant, there will be no. change to any of these margins. Thus,. '
/the proposed license amendment will.not involve a reduction in a margin of safety. -
.lf you have any questions, please contact Mr. Terry L. Harpster, Director of Licensing Services,= at (603) 474 9521, extension 2765.-
Very truly yours. Ted C. Felgenbaum v L---__-__ . .
- . _ _ - _ _ _ __ _ -. . . _ . _ . ~ . . _ . _ . _ _ . _ . . _ . _ _ _ . - - _ -
;g .c,_.,,
-4 United States Nuclear Regulatory Commission November 13, 1990 ,
Attention: -Document Control Desk- - Page three -. -t Enclosure (s)
' TCF:JBH/les cci Mr. Thomas T. Martin .
Regional- Administrstor United States Nuclear Regulatory Commission : Region ! f
. 475 Allendale .7ead King of Prussia, PA 19406- i Mr. George L Iverson, Director Office of Emergency Management
_. State Office Park _ South 107 Pleasant Street--
' Concord, NH 03301 Mr. Victor Nerses, Sr. Project Mgr.
' Project Directorate 13 1 Division of Reactor Projects N
. U.; S. Nuclear Regulatory Commission
' Washington,' DC 20555 1
- o. -< _ Mr. Noel Dudity f Of
' NRC Senior. Resident inspector P.O. Box 1149
.(
Seabrook, NH _ 03874 j }. ! .Q t f, E h l i p
e, *
.. New Hampshire Yankee November 13, 1990 t k
I, ENCLOSURE 1 TO NYN 90194 4 4 e 4 ... 4 6 h=r-* e, .,- s4 ., v' %e -=e, e-
BEFORE THE i UNITED STATES NUCLEAR REGULATORY COMMISSION LICENSE NO. NPF-86 DOCKET NO. 50-443 IN THE MATTER OF PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE SEABROOK STATION, UNIT NO. 1 l l APPLICATION TO AMEND FACILITY OPERATING LICENSE NO. NPF-86
-I
-TO AUTHORIZE NORTH ATLANTIC ENERGY SERVICE COMPANY TO ACT AS MANAGING AGENT FOR SEABROOK STATION, UNIT NO. 1 November 13,- 1990.-
ll'
, s I.
l' I
-:1 ll l
f% . T V .
3-I g r or cont g Eg,qi i g- I.. INTRODUCTION . ..
. . . _ . . . . . - . . . . . - . . 2-s- II. MANAGING AGENT . . .
5 III. REQUESTED APPROVAuS AND CONSENTS . . . . . . . . 7 IV. GENERAL INFORMATION CONCERNING THE AMENDMENT ' PEQUESTED HEREIN . .
............... 8
.A.= Proposed Additional Licensee ._. . . . . . . 8 B. -Address . . .
................ 9 C. Description of the Business of NAESCO Under the Joint Plan . . ............. 9 D. Organization and Management of NAESCO . . . . l'0 E. Technical Qualifications. . . . . . . . . . . I '. ,
1.- The Management, Operation and Maintenance of-Seabrook Until the Time vf Effectiveness ............. 11 2.- The Management, Operation and Maintenar.ce of Seabrook by NAESCO.As of the Time of Effectiveness .-, . . . . . . . . . . . m 11 is-[ 3. Benefits .
.............. 15 J F. Financial-Qualifications . .
-3
. . . . . -. . . 16' G. Antitrust Considerations ... . . . . . . . . 17 H. Restricted Data .............. 17 I.- 'Public Health, Safety and Welfare Considerations ... ....:.. ...... 18 J. Exclusion Area . .......-,..... 18 K. Offsite Power . ................ 19 V.- NO SIGNIFICANT HAZARDS CONSIDERATION EVALUATION PURSUANT TO 10 C J.R. 5.50.92 . -
. . . . . . . . . 19 A. Proposed Changs- . _ . . . .- . . . . . . . . . 19 B. No_Signifi: ant Hazarda Consideration-Analysis . . . . . .-. . . . . .-. . . . . . 19 p
tj. v -# v , .-,
. .- .- . . . ~ , - . - . . . . -. .. ..-. _ - . . . - . . ..- . ~ . . - . . -
~
.: TABLE Or Cot! TENTS
- f. , *. (continucd) .
.2 2A2.t
.C.; ' C o n c .'.u s i o n .. . '. -. . . . . = . . . . . . . . . 21
,VI. : ENVIRONMENTAL CONSIDERATIONS . . . . . . . . .. . 22 VII. OTHER' MATTERS . . . . . . . . . . . . . . . . . . 22 EXHIBIT 1 - July 19, 1990 Agreement of Seabrook Joint Owners 1
- appointing NAESCO Managing igent and Operator of Seabrook- ,
EXHIBIT 2 - Proposed Form or-Amendment to the Seabrook Operating License 1 s i 7 l' i
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' 4 UNITED STATES OF AMERICA 4-NUCLEAR REGULATORY COKKISSION
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I~ In the Matter of ) Public Service' Company of ) -Docket No 50-443 New Hampshire )
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s (Seabrook Station, Unit No. 1) .) i APPLICATION TO A!!END FACILITY OPERATING LICENSE NO. NPF-86 i Public Service Company of New Hampshire ("PSNH"), acting for: itself.and as-agent for Canal Electric Company, The Connecticut
-Light and Power Company ("CL&P"), EUA Power-Corporation, Hudson Light.& Power Department, Massachusetts Municipal Wholesale
- Electric: Company,- Mon' m;. Electric Company,- New England Power f
Company, New Hampshire Electric Cooperative, Inc.,.Taunton- i 1 Munici?x1 Lighting Plant The United Illuminating Company,_and _. a Vermont: Electric Genciation and; Transmission Cooperative, Inc. j (collectively the " Licensees"), and on behalf of North Atlantic-h 1 Energy Service! Company ("NAESCO", collectively with the Licensees,
- the'" Applicants"), hereby files this application ("the
. Application") to Amend Facility-Operating License No'. NPF-86.' e
- Operating l License No..NPF-86 ("the-Operating License") presently--
,0sthorizes the Licensees to possess SeabrookcStation, Unit No. 1 q
("Seabrook")1 as Joint Owners, and authorizes'PSNH as agent and g representative.of the Licensees-to possess =, use'and opsratet SeabrookLin ac,cordance-with the terms-and conditions of the Operating: License. .ThisEApplication requests the-amendmenttofsthe: - p p . Operating License- to. include as_ a Licensee thereunder, a newly : a~) _ S y i- , ,- N - .
--. 2 a
created entity, NAESCO, and to authorize NAESCO. a9 agent for the
~\'- other Licensees, to manage, operate and maintain Seabrook.
As explained in more detail below, NAESCO will be organized as a wholly-owned service company subsidiary of Northeast Utilities ("NU"), after receipt of necessary regulatory approvals. In the interim, NAESCO's interests are being represented by Northeast Utilities Servi.co company ("NUSC0"), another subsidiary of NU. PSNH has been authorized by NUSCO to make this filing in the name t of NAESCO, and a confirmatory Power of Attorney-from NAESCO will be obtained and filed as soon as possible. I. INTRODUCTION
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(_) Soabrook is_a nuclear powered electric generating facility
'which has been constructed and is being operated on behalf of the Licensees, b group of investor-owned and muaicipal utilities, pur7uant ao on Agreement for Joint Ownership, Construction and Operation' of Mrw Hampshire Nuclear Units, dated May 1,1973, as amended (the " Joint Ownership Agreement")',and certain permits and licenses heretofore issued by the Nuclear
- Regulatory Commission (NRC) . Irf accordance with the Joint Ownership Agreement, PSNH,.an l
niectric utility organized and opfsrating under the laws of New Hampanire, has acted as lead participant and Managing Agent for all
'The Joint Ownership Agreement'has previously been filed in this Docket. Another. copy will be provided if the Steff so ,
requests. O V
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3 the Licensees, with responsibility for management, operation and maintenance of Seabrook, which position has been recognized in the Operating License as noted above. .Since 1984,-PSNH has exercised
-this authority through its New Hampshire Yankee Division (*NHY").
On January 28, 1988, PSNH filed a voluntary petition with the United States Bankruptcy Court, District of New Hampshire (the
" Bankruptcy Court") for protection under Chapter 11 of-the Bankruptcy Code. After prolonged proceedings, the Bankruptcy Court, on December 28, 1989, approved the Third Amended Plan of Reorganization'(the " Joint Plan") proposed by NUSCO and other parties. On April-20, 1990, tha Bankruptcy Court confirmed the
~ Joint Plan and ordered its implementation. ,
The. Joint Plan: involves a two step process-by which NU subsidiaries ultimately acquire PSNH's business, after receipt of [ all necessary regulatory-approvals--(including NRC approval): the generation:and~ distribution business going to one' subsidiary;- - PSNN's: ownership interest in the Seabrook: facility. going to afnew. _ l wholesale generation company; and the Seabrook operational-responsibility, currently' exercised by NHY, being1 transferred to-NAESCO. Each aspect of the Joint' Plan _is subject to a variety of _
- regulatory huzdles,: some of which will-be more. protracted than L others. 'As:a~ result of_thw prolonged bankruptcy proceedings which.
-i preceded confirmation-of the Joint Plan-and the on-goingiregulatory e proceedingsLnecessary to implement the Jo.'.nt Plan, there-has.
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naturally been some uncertaintyLon the part of Seabrook personnel as-to their future role. Therefore, in the interest of maintaining theEstability of the operating atmosphere at Seabrook and removing any distractions which may be created by the pending ragulatory o proceedings, the Licensees agree that a prompt transfer of operational control of Seabrook to NAESCO, with minimal impact on current operations, would be in the best interest of the Seabrook project. Not only.would such transfer provide the benefits described below, but it would also-constitute a tangible step toward the resolution of the financial and business uncertainties throughout New Hampshire which have been created by the bankruptcy i filing of PSNH. Therefore, the Joint-Plan provides that.promptly after NRC
) approval of this Application and issuance of the requested Operating License- Amendment and receipt of all other necessary regulatory-approvals, NAESCO-will succeed PSNH as managing agent and become. responsible for the-management, operation and i
!maintenLacefof Seabrook. LThese necessary: approvals' include ~New-HampshirefPublic Utilities-Commission-(PUC) approval of'the issuance of' common stock by NAESCO asua New Hampshire corporation 2
and; utility , approval' by the~ Securities)and Exchange Commission _(SEC), under the-Public Utility Holding Company Act of 1935, of-
'E 3
In its decision dated' July 20, 1990, the: New Hampshiref PUC approved theLcreation of NAESCO as a public utility.for the
-purposeJof managing,' operating and maintaining Seabrook.
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5 NU's acquisition of NAESCO stock and NRC approval of this 3 Application _by issuance of an Operating License Amendment. if On July 19, 1990, the Joint Owners entered into an agreement which appoints, subject to NRC approval, NAESCO to be the managing agent and operator of Seabrook as of the " Time of Ef fectiveness*', sets forth their basic understandings on this subject and outlines the provisions to be contained in a subsequent management contract
-between the Joint owners and NAESCO, as_well as possible changes in ;
the Joint ownership Agreement. A copy of the July:19, 1990
-Agreement is attached as Exhibit 1.
Until the Time of Effectiveness, PSNH acting through NHY, will-e continue to be responsible for the management, oparation and k._m[ maintenance of Seabrook. I
'!I.- MANAGING AGENT The July 19, 1990. Agreement provides that NAZSCO will become :1 Managing Agent in accordance with Paragraph 36.2 of the-Joint
'These proceedings _will be promptly initiated by NU and-copies-of the approvals will-be provided to.the NRC as soon as-they are available.
'The." Time of Effectiveness" is defined in the July 19, 1990 Agreement as 11:59 P.M. on the last, day of1the calendar month in which the NRC' amendment to the Opersting License designating-NAESCO as the entity qualified to operate Seabroc' abecomes effective,-and all other necessary federal, state and_ local regulatory,Ljudicial:and other approvals have become effective with respect-to such designation.
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w 6 H () Ownership Agreement. _ It specifically grants to NAESCO, subject to prior receipt of' favorable action by the NRC on-this-Application, 1 alliof the responsibility for day-to-day management, operation and c' maintenance of'Seabrook which the Joint Ownership Agreement and Operating License currently assign to PSIO{ in its role as agent and representative of the Joint Owners (Licensees). Thus, on and after , the Time of-Effectiveness, NAESCO, as agent for the Licensees, will be responsible' fort ;
- managing,' operating and maintaining Swabrook; selecting, employing, training and maintaining sufficient personnel to staff Seabrook-in accordance with NRC-Llicense and regulatory requirements, and providing or -
causing to be provided any support: services for such-
' operations;
*- plann3ug for nuclear fuel utilization at~Seabrook and s
, procuring-on behalf of the Joint Owners the requisite nuclear fuel,; including arranging-for all stages.of
< uranium processing,< fuel design and. fabrication and eventual storage, transportation,; disposition ~and/or reprocessing of. irradiated nuclear: fuel:and the disposition of or-use of-reprocessed material;'
- purchasing:and maintaining on behalf o'f the Jointiowners,- ,
appropriate leveli or-~1nventories of materials,-supplies: and spere parcs frequired for: the operation and maintenance of Seabrook;
- after consultation with the.Seabrook Executive. Committee to.the extent required by the: July 19,:1990 Agreement,;
selteting'and retaining consultants-and~ contractors-to assist in the performance of-NAESCO's responsibilities;_ t i reporting.lto the Seabrook Executive Committee and--Joint Owners-on'Seabrook operations and-finances.(including. insurance); : and-- O . 4 I
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3; 7 - I!ys[ taking all other actions necessary in order'to keep-the L Operating. License and other necessary regulatory permits-
'in full force and effect.
1 The Licensees contemplate that this transition will be ' initially accomplished by transferring to NAESCO as of the Time of Effectiveness the existing staff of NHY and all existing authority to administer contracts with respect to Seabrook. This will achieve continuity in the management of Seabrook by allowing NAESCO I to initially assume the role of oporator of Seabrook with the same staff =and contractcr support resources that the NRC hoc previourty evaluated and approved in connection with the technical qdalifications of PSNH, including t'.e engineering and technical resources supplied under contract-by-Yankee Atomic Electric Comps.ny ( " YAEC ". ) . . Thus, Seabrook will be assured of the continuing ' () availability of technical expertise for its operation. NAESCO, in i the exercise of its management responsibility and discretion, will-
, j
- thereafter have the flexibility of determining how those existing-resources can best be integrated with=the other resources available to NAESCO, ine ; ding-those from the NU system, in order to carry ,
out itsJresponsibilities with respect to the operating License. III. REQUESTED-APPROVALS-AND CONSENTS' E The Applicants request that'the NRC amendIthe Operating. 1 License so.that at the Time of Effectiveness'as defined herein,- 1 j.
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kf NAESCO be included as a Liceasee and be given the authority to manage, operate and maintain Seabrook.8 Specifically, pursuant to 10 C.F.R. S 50.90, the Applicants hereby request that the NRC amend the Operating License in the manner indicated in Exhibit 2.' Set forth below in the information submitted in support of this Application. IV. GENERAL INFORMATION CONCERNING THE AMENDMENT REQUESTED HEREIN A. Procosed Additional Licensee [ North Atlantic Ener7y Service Company t 8 0n this date, a separate application'has'been filed with the Nuclear Regulatory Commission requesting approval of an amendment to the Operating License to reflect a change in-the
' ownership of Seabrook. Under the terms of the Joint Plan, all of
-PSNH's ownership in Seabrook-("Seabrook Interests");will-ultimately be transferred to another newly-created, wholly-owned subsidiary of NU called North Atlantic Energy Corporation (NASC).
i However, providedxthat the NRC approves this Application and issues the Operating License Amendment requested:herein, the L Joint Owners-intend-to transfer the management, operation and-L maintenance of Seabrook to NAESCO at the Time of Effectiveness regardless of'the status of-the transfer of the Seabrook Interest
- pursuant to the Joint Plan.- Thus the Applicants are requesting in this Application that approval'by the.NRC of the amendment '
requested herein and:the authority to effect them not be contingent-upon other aspects of the-Joint-Plan.
' Conforming changes'in the indemnity and insurance agreements will be made~1n due course by separate correspondence.
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B.- Address North Atlantic Energy Service Company Seabrook Station Route 1, Lafayette Road P.O. Box 300 Seabrook, New Hampshire 03874 Attention: Ted C. Feigenbaum i Copies of all official correspondence should also be sent to: North Atlantic Inorgy Service Company l c/o Northeast Utilities Service Company P.O. Box 270 l Hartford, Connecticut 06141 Attention: John F. Opeka Executive Vice President i C. Descriotion of the Business of NAESCO finder the Jalai E.1A.h Prior to the issucnce of an amendment to the Operating License reflecting the changes requested herein, NAESCO will be organized O 1
.5 as a wholly-owned subsidiary of NU, and will take all necessary corporate and other action to authorize NAESCO to_ manage, operate and maintain Seabrook as of the Time of Effectiveness.
After approval of the amendments requested in-this Application, NAESCO will, as of the-Time of Effectiveness, be responsible-for the management, operation and maintenance of Seabrook in.accordance with the terms and conditions of'the
-Operating License, the JUu:'is rules and regula tons and the Joint
' Ownership Agreement.
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10 _s D. Oroanizatic: y.. d Manacement of NAESCO Q. NAESCO will be a corporation and public utility organized under the laws of the State of New Hampshire. It will be a wholly-owned service company subsidiary of NU. The principal office of NAESCO will be located in Seabrook, New Hampshire. NAESCO will be neither owned, controlled nor dominated by an alien, foreign corporation, or a foreign government. All of the prospective directors an'd principal officers of NAESCO will be citizens of the United States. Their names and addresses are as follows: Directors l 7, Bernard M. Fox Lawrence H. Shay Ted C. Feigenbaum L
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f Robert E. Busch John P. Cagnetta Frank R. Locke Edward J. Mroczka Walter F. Torrance, Jr. William B. Ellis John F. Opeka The address for Ted C. Feigenbaum will be as indicated in Section IV.B above. yet all of the other directors the address will be North Atlantic Energy Service Company, c/o Northeast Utilities Service Company, P.O. Box 270, Hartford, Connecticut 06141-0270. I Officers L William B. Ellis Bernard M. Fox John F. Opeka Robert E. Busch John P. Cagnetta Edward J. Mroczka Lawrence H. Shay C. Thayer Browne Walter F. Torrance, Jr. u Tod O. Dixon Albert J. Hajek Barry Ilberman l Francis L. Kinney Keith R. Marvin Wayne D. Romberg l George D. Uhl Eric A. DeBarba C. Frederick Sears l Theresa A. Allsop Karen G. Valenti Robert C. Aronson l Arthur H. Hieri Ted C. Feigenbaum Eugene G. Vertefeuille
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11 r~h. j ,)] The address for all of the above officers except Ted C. Feigenbaum, will be North Atlantic Energy Service Company, P.O. Box 270, Hartford,-Connecticut 06141-0270. E. Technical Oualifications
- 1. The Manacement, Ooeration ar.Q_ Maintenance of Seabrook Until the Time of Effectivenesa,.
Until the Time of Effectiveness, the management, operation and maintenanee of Seabrook will' continue to be the responsibility of PSNH. The NRC_has, in issuing the Operating License to the Licensees, approved the technical qualifications of PSNH, acting l- through NHY, to manage, operate and maintain Seabrook.7 l: O g
- 2. The Manacement, Operation and Maintenanec of Seabrook by NAESCO As of the Time of Effectivenese As of the Time of Effectivenuss, NAESCO will be responsible for the management, operation and maintenance ef Seabrook. NHY employees will become NAMSCO empicyees as of that date. The overriding philosophy that will govern NAESCO management will be one of assuring that NAESCO will manage, operate and maintain Seabrook in accordance with the conditions and requirements
'Seabrook Station, Unit No. 1 Facility Operating License No.
NPF-86, Paragraph 1.E. (" x_J . 6
l j 12 astablished by the NRC with respect to Seabrook and with the same 7-
' regard for public and personnel' safety as heretofore exemplified'by NKY.
Ted C. Feigenbaum, who served as Senior Vice President and Chief Operating Officer of NHY until October 1, 1990, is now the President and Chief Executive Officer of NHY. After the Time of Effectiveness, Mr..Feigenbaum will become a NAESCO emptoyee, 't officer and director and will continue to act as the Seabrook i Senior Nuclear Officer. Mr. Feigenbaum will have final site authority, and will be responsible for the overall' safe operation and maintenance of Seabrook. The NHY operatAng and onsite technical support organizations, O \_- as described in.Chepter 13.1.2 of the Final Safety Analysis Report (FSAR),-will become part of MAESCO and will continue to report to
-Mr. Feigenbaum. Specifically, these organizations are Station-Management, Operations, Training, Chemistry and Health Physics, Technical Support, Maintenance, Security and Fire Protection. This will ensure that the functions, responsibi,11 ties and reporting relationships of these organizations, especially_as-they relate to activities important to the safe operation of Seabrook, will continue to.be clear and unambiguous. The NHY corporate management and technical support organizations including Quality Assurance, Engineering, Licensing, and Emergency Preparedness will also become part of NAESCO and will continue to report to Mr. Feigenbaum.
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13 D c t After the Time of Effectiveness, Mr. Feigenbaum will report to John F. Opeka, the Executive Vice-President of NAESCO, whc will have corporate responsibility for overell plant nuclear safety. NNY's organization and its technical qualifications have been described-in the FSAR for Seabrook. The NRC has reviewed and concluded in its Safety Evaluation Report, and documented in the Operating License, that NNY's organization is technically qualified
.to manage, operate and maintain Seabrook.
The NAESCO operating organization will not only succeed to the , resources of NHY but will also be able to draw on the rescurces of , 7, . two other proven organizations: YAEC and NU. The NRC has reviewed
~k-) YAEC's tnchnical qualifications with respect to its design, ,
y engineering and operational support of $eabrook and has documented its findings of adequacy in C,hapter 13lof the Seabrook SER. In addition, the NRC has previously approved the technical' qualifications of YAEC in its reviews of the-Yankee Rowe, Maine
-Yankee and Vermont Yankee licenses (License Nos. DPR-3,LDPR-6 and L DPR-28, respectively).
Im which, through its operating companies, is -currently the L largest nuclear plant operator in New England, has a proven record L of safe and ' efficient nuclear plant operation and a deraonstrated l i regard for public and personnel safety. Specifically, NU l lO
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. 14 s z -affiliates operate,.and have ownership interests in, four-nuclear N. sunits in Connecticut: (1) the Haddam-Neck plant, operated by 1
Connecticut Yankee- Atomic. Power Company ("CY"),' -(2) Millstone Nuclear' Power Station, Unit No.-1, operated by Northeast Nuclear Energy Company ("NNECO"), 100% of such plant being owned by NU. subsidiaries,' (3) Millstone Nuclear Power Station, Unit No. 2, L operated.by NNECO, 100% of such' plant being owned by.NU ; 1 subsidiaries,1'.and (4) Millstone Nuclear Power Station, Unit No. l 3, also operated by NNECO and 65.1715% of such plant being owned by NU subsidiaries." The technical qualifications of these NU System J
'l companies,.which-have over 50 reactor years of operating ;
i experience, have also previously been reviewed and approved by the ! NRC. l-
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.NAESCO will be well-qualified to assume responsibility for the operation, management and maintenance of Seabrook. :Following Dimplementation.oftthe proposed license amendments, the technical qualifications of the Seabrook operating. organization will be at i least equivalent to those of the present Seabrook operating l-4 i
. .' Docket No. 50-213,-License No. DPR-61.(issued June 30, 1967).- CL&P owns 34.5% of the common stock of CY, and 9.5% is owned-by~ Western Massachusetts Electric Company..
r ' Docket No. 50-245, License No.-'DPR-21 (issued -<ni October 7, 1970). 8' Docket No. ~ 50-336, License No. DPR-65 (issued on August 1, 1975)..
'" Docket No. 50-423, License No. NPF-49 (issued on November li 25, 1985).
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. 15 organization, uand very .likely will be enhanced, becau'se of NAISCO's
-increased ability to draw upon the experience and expertise of NU ;
as well as YAEC. This will result in greater depth of technical-support and greater efficiencies in operation. 1 h
- 3. Benefits The transfer of operational responsibility.from NHY to NAESCO-will provide substantial benefits that are inherent to an operating _
organization that is supported by a system-wide management company with broad nuclear experience. Some of the expected benefits;are 3 (1) NAESCO will have access to the wealth of nuclear
' operating experience and expertise currently existing in NU's nuclear operating subsidiaries. This will enhance public safety and cost effective operation.
(2) Organization of NAESCO under NU will allow the p development of specialization in certain areas that might a not otherwise occur. (3) By operating as part of NU, NAESCO will engage in more effective communication with other NU nuclear plants and , as such be aware of relevant. nuclear _ operating experience and " lessons learned" promptly and consistently. O-
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(4) Certain non-nuclear support functions may be transferred from NAESCO to NU's specialty groups enabling NAESCO to focus more effectively on the requirements of nuclear operations. (5) Inclusion of present NHY employees.in NAESCO as part of NU's nuclear operating organitation will provide greater opportunity for career enrichment and advancement enhancing the ability to attract and retain highly qualified employees. F. Financial Oualifications
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(J The issue of the financial qualifications of the Licensees, each of which is an electric utility, has been previously reviewed and formally resolved in this Docket. This Application does not in any way alter the status sBut with respect to the Licensees' ability to obtain the funds necessary to cover all costs for the operation, construction, maintenance, repair, decontamination and decommissioning of Seabrook, each Licensee remaining severally liable for such costs under the Joint Ownership Agreement. NAESCO, as managing agent for the Licensees, will perform certain functions on behalf of the Licensees, the costs of which will continue to be borne by the Joint Owners. NAESCO itself will rx
17 i be compensated at cost by the Licensees for any expenses incurred (/
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in performing its duties. Therefore, this Application raises no issue v'th respect to
-financial qualifications.
G. Antitrust Considerations NAESCO, as managing agent for the Licensees, will manage, operate and maintain Seabrook on behalf-of all the Licensees. NAESCO will not acquire any ownership interest in Seabrook itself or;in any electric energy produced by Seabrook and will not have any role in the marketing of such energy. Therefore, this Application has no impact whatsoever on tne market for electric g'j-'t _powei and raises no issue with respect to antitrust considerations affecting that market. H. -Restricted Data This application does not contain any Restricted Data or other defense information, and it is not expected that any such information will become involved in the licensed activities. However, in the event that such information does become involved, NAESCO agrees that it will appropriately safeguard such information and will not permit any individual to have access to Restricted Data until the Office of Personnel Management shall have made an
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. 18 investigation and reported to the NRC on the character, ~
associations and loyalty of such-individual, e.nd the NRC shall have determined that permitting such person to have access to Restricted Data will-'not endanger the common defense and security of the United States. I. Public Health Safety and Welfare Considerations The proposed. license amendment would include NAESCO as a Licensee and authorize NAESCO, as agent for the other Licensees, to
. manage, operate and maintain Seabrook. It does.not affect the physical configuration of the facility or adversely affect the technical specifications under which Seabrook operates. Moreover,
-as described in this Application, the technical qualifications of
(,s) Ad NAESCO to operate Seabrook will be at least equivalent to those of
.NRY. The proposed license amendment will therefore not have any adverse impact on the public health, safety and welfare.
-J. Exclusion Area Upon approval of the license amendment providing for assumption-of operating responsibility-by NAESCO, NAESCO will have authority to determine all-activities within the Seabrook exclusion area, to the extent required by 10 C.F.R. Part 100.
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- 1. 19 K. .Offsite Power-Offsite power is currently assured to Seabrook over ,
transmission facilities-' owned by PSNH and.New England Power Company, two-of the Licensees. These arrangements will..not change
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. as . a -result of the s changet in operational control. requested by this
. Application.:
-V. NO SIGNIFICANT HAZARDS CONSIDERATION-EVALUATION
-PURSUANT TO 10 C.F.R. S 50.92 A. 'Procesed Chance f
E~ 1 The proposed-amendment to-the Operating License would revise s . the: Operating License ~to authorize NAESCO-to manage, operate:and
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E, maintain Seabrook as of the Time of Effectiveness. Until the/ Time iof Effectiveness, PSNH, through NHY, will continue to have.the exclusive responsibility for the management, operation and!- -g maintenance of"Seabrook. B '. 'No Sittnificant Hatards Consideration Analysis V 1 . Applying the-three standards set forth'in 10 C.F.R. S 50.92, Lthe. proposed-changes tosthe Operating License' involve no significant hazards: consideration l
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20 1.- The. proposed-changes will not increase the probability or 5 _, consequences of any accident previously evaluated. The technical 1
< qualifications of NHY, the-NU System companies and YAEC have
=already been approved by the NRC. There will be no changes that i
would adversely affect the NRC's conclusions on the technical qualifications of the Seabrook management, operating or maintenance organizations as documented in the Seabrook Safety Evaluation Report as supplemented. Further, as a result of the proposed license amendment,~there ; Ewill be rua physical changes to the Seabrook f acility and all
- Limiting, Conditions for Operation, Limiting Safety System Settings, and Safety Limits specified in the Technical Specificationsowill c remain unchanged. Additionally, with the.-exception of
- -administrative changes to reflect the role of NAESCO, the-commitments in the Seabrook Quality Assurance Program, and-the lSeabrook-Emergency Plan, Security Plan, and Training Program will be unaffected. Moreover, the license amendment will-not-result in any changes to NNY's regulatory commitments.to the NRC.
c.
- 2. The proposed amendment will not create the possibility of a new or different kind of accident from any accident previously evaluated. The Seabrook design and design bases will remain the same. The current plant' safety analyses will therefore' remain complete;and_ accurate in addressing the licensing basis events and-
.in analyzing plant. response and consequences.
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.The' Limiting Conditions for Operation, Limiting-Safety System Settings and Safety Limits for Seabrook are not affected by the ;
proposed license amendment. With the exception of administrative
- changes to reflect the role of NAESCO, plant procedures will be unaffected. As such, the plant conditions for which the design -
basis accident analyses have been performed will remain valid. 1 i Therefore, the proposed license amendment.cannot create the possibility of a new or different kind of accident than_previously i evaluated..
- 3. The. proposed amendment will not. involve a reduction in a
'I margin of-safety. Plant-safety margins are established through :
Limiting Conditions for Operation, Limiting Safety System. Settings
.and Safety Limits specified in the Technical Specifications. Since l
there will be no change to the physical design-or operation of the
- plant, there.will be no change to any of these margins. Thus, the proposed license amendment will not involve a reduction in a margin of' safety.
C.- Conclusion Based upon the analyses and description of the transaction provided herein, the proposed-license amendment will not increase
.the. probability or consequences of any accident previously evaluated,. create the possibility of a new or difforent. kind of O .
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22 accident from-any accident previously evaluated, or involve a I ss ?_ reduction in a margin of safety. As a result, the proposed changes meet the requirements of 10 C.F.R. S 50.92(c) and do not involve a significant hazards consideration. VI. ENVIRONMENTAL CONSIDERATIONS The proposed amendment will not result in any change in the types, or-any increase in the amounts, of any effluents that may be released offsite,.and there will be no increase in individual or cumulative occupational radiation exposure. Accordingly, pursuant to 10 C.F.R. Section 51.22(c)(9), the proposed Operating License amendment is categorically excluded from the-need for an environmental assessment or an environmental impact statement, and
) special circumstances do not exist to otherwise require such an
-assessment or statement. Alternatively, the applicants herein request that the Commission issue and publish a finding of no significant impact pursuant to 10 C.F.R. Secttons 51.32 and 51.35.
VII. OTHER MATTERS , The.Seabrook Station Operation Review Committee and the Seabrook Nuclear Safety Audit Review Committee have reviewed the proposed amendment as required by Section 6 of the Seabrook Technical Specifications and have recommended approval to NHY
- i. ;, . .
, .. 23 e- Texecutive: management. A copy of the Application is a'lso being J-
provided' to the State of New Hampshire. A copy of the NUSCO authorization with respect to this Application is filed herewith and a confirmatory Power of Attorney from NAESCO will-be obtained and filed as soon as possible. l The Applicants request that the amendment described herein.be 1 issued by--the first quarter of 1991, with the Operating License changes to become effective as of the Time of Effectiveness (see
.f ootnote -4 )-.
, Respectfully submitted, l
~-
L 3 NEW EAMPSHIRE YANKEE' DIVISION D
- OF PUBLIC SERVICE COMPANY OF NEW RAMPSHIRE, on behalf of the Licensees and NAESCO-By D /kfi#" /& -
/
l-l~~
~e~ e .vm e - - ,-r
AFFIRMATION I, Ted C. Feigenbaum, being duly sworn, state that I.am-
President and Chief Executive Officer of the New Hampshire Yankee Division of Public Service Company of New Hampshire; that-on behalf
-of the Applicants in this proceeding I am authorized to sign and file with the Nuclear Regulatory Commission this " Application to Amend Facility Operating License-No.-NPF-86"; that I signed this Application as President and Chief Executive Officer of the New Hampshire n nkee Division of Public So.cVice Company of New Hampshire; and that the statements made and the matters set forth therein are true and correct to the best of my knowledge, information and belief.
fb C'/M Ted C. Fe)(enbawn
- 'r STATE OF NEW HAMPSHIRE COUNTY OF Rockincham i Subscribed and sworn to me, a Notary Public, in and for the County and State above named, this i3 day of November, 1990.
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O EIHIBIT 1 O t O -
OT Exhibit 1 to the NRC Application is the July 19, 1990 Agreement, included herein as Exhibit B.6 l l
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O l' ( l-e EXHIBIT 2 i G e 4 4
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. AN s e. .;
O fPROPOSED FORM OF LICENSE AMENDMENT)- PUBLIC' SERVICE COMPANY OF'NEW HAMPSHIRE. ET AL I i
-DOCKET NO. 50-443
, SEABROOK STATION. UNIT NO. 1
' AMENDMENT ~TO FACILITY OPERATING LICENSE Amendment No. 1 License No. NPF-86'
- 1. . LThe' Nuclear Regulatory Commission (the Commission.or_the NRC) has found that:
A. -The' application for amendment filed by_the Publ-ic.
. Service Company of New Hampshire (the licensee),
acting for itself and as agent and representative.of-the 11 other utilities listed below and'for North-
=
Atlantic. Energy Service-Company, hereafter referred-to as licensees,' dated , 1990 and
' supplemented.by letters dated, , and-
- ~
,'1990, complies with the standards and --
-requirements of the Atomic Energy.Act of 1954, as. '
amended:(the Act), and the Commission's rules and y regulations-set forth-in 10 CFR' Chapter I;.
.B. Theefacility will operate in conformity with the
-application,'the provisions of the Act, and the -
rules and regulations of;the Commission; a_' C. There is reasonable assurances (1)-that the
-activities authorized by this amendment _can bel _
' conducted without endangering-the health and1 safety-of'the-public,.and.(ii)1that such activities::willibe
,. conducted.in compliance with-the Commission's-P rregulations set forth:in'10 CFR Chapter =I;-
'l
*Except'as-hereinafter modified-by this-amendment, Public
- Service l Company.of New Hampshire is.authorised to act as agent-4 9E for theiLCana Electric-Company,-The Connecticut: Light and Power
- Company, EUA Power Corporation,. Hudson Light & Power Department,-
- Massachusetts Municipal Wholesale: Electric Company,~Montaup Electric Company,'New' England ^ Power; Company, New-Hampshiref
; Electric Cooperative, Inc., Taunton Municipal' Light-Plant,-The
? United-Illuminating Company, and Vermont Electric' Generation and Transmission Cooperative, Inc., and has exclusive responsibility
=
1 and control over the physical construction, operation and maintenance of the facility. f
a c p e o _. M 4 ,4 A di. d .+-.A4
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D. The issuance of'this amendment'will-not'be inimical- - to the common-defense and; security or to the health and safety of the public; and E. The-issuance of this amendment-is in accordance with 10 CFR Part 51 of the Commission's regulations and all applicable. requirements have been satisfied.
- 2. - Accordingly, effective as of 11:59 P.M.-on the last[ day' =
.of , 199- '
paragraphs as folTo,w.the s: license is amended by modifying' a). Paragraph 1.E. of the license.shall read: North Atlantic Energy Service Company is technically. qualified to engage in the activities authorized by-this license in accordance with.the 4 Commission's regulations. set.forth-in 10 CFR. Chapter 1"1. b) The footnote on page 1 of the license shall read: ! North. Atlantic Energy Service Company (NAESCO) is authorized to act as agent for the Public Service. Company of New Hampshire (North Atlantic'
- ~
Energy Corporation],-Canal Electric Company, The.
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Connecticut Light and Power. Company,'EUA Power- -- Corporation,. Hudson Light &. Power. Department,-
.. Massachusetts Municipal Wholesale Electric Company, q Montaup Electric Company, New England-Power-Company, ;
New Hampshire Cooperative, Inc., Taunton' Municipal Light Plant, The United Illuminating Company, and Vermont' Electric Generation and Transmission - ! Cooperative, Inc., and has exclusive responsibility. 1 and control over the physical construction,- operation and maintenance of.the facility. . c) Paragraph 2'shall read as follows: Based on the foregoing findings and the Commissions: Memorandum and Order, CLI-90-03, (dated March 1, 1990), Facility Operating License NPF-86,
, issued to NAESCO et al.,-(the licensees)', is'hereby s amended to read as follows:"
' d). Paragraph.2.B.(1) shall be modified by substituting
" North: Atlantic Energy Service Company ("NAESCO")
for-"Public Service Company of New Hampshire i
-("PSNH").
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t, 3 , , ' , 3 ,
.i'f; e) Paragraphs 2.B.(3), 2.B.(4), 2.B.(6), 2.C.(1_),
2.C.(2) and 2.C.(3) shall each be modified by substituting "NAESC0" for "PSNH". I f) Paragraph.2.D., 2.E., 2.F. and 2.G. shall-each be modified by substituting "NAESCO" for "PSNH" wherever the latter appears. 3.- This license amendment is effective as of its date of issuance. 1 FOR THE NUCLEAR REGULATORY COMMISSION Date of Issuance: , 199_ u l. 1 O l
s .-
- New Hampshire Yankee November 13, 1990 i
ENCLOSURE 2 TO NYN - 90194 O s
8 J, . ' , . . ' . 4 : . . . .
- 1. -. APPvINTMENT OF AGENT'AND SIGNATURE OF APPLICANT WHEREAS.11n. connection with Northeast Utilities' proposed-
. acquisition of Public Service Company of .New Hampshire ( PSNH) ,
North Atlantic: Energy Service Company .(NAESCO) will be organized under the. laws cf New Hampshire and will be a public utility regulated.under New Hampshire law, and WHEREAS, NAESCO will be a wholly-owned subsidiary of NortheastJUtilities,.and WHEREAS..as:part of such proposed acquisition of PSNH,
.. NAESCO will, after obtaining the approval of the U.S. Nuclear Regulatory Commission (NRC) and certain-other-agencies, assume
- responsibility for the management, operation and maintenance of SeabrookEStation -and WHEREAS, -Portheast Utilities Service- Company (NUSCO) 'has.
--been representing the interests of NAESCO in regulatory
. proceedings.before the Securities and ExchEnge Comnission, the
! Federal. Energy Regulatory Commission, and various' state agencies
- that have asserted regulatory jurisdiction over certain aspects of'the-acquisition, and
, : .. e-
_.*.i.' WHEREAS, NUSCO is authorized to:act on behalf of NAESCO as its agent. NOW, THEREFORE, NAESCO, acting by and through its agent, NUSCO, hereby- joins in- the filing of- this Application to Amend ; Facility Operating License No, NPF-86 and in connection therewith hereby appoints Public Service Company of New Hampshire, acting through its New Hampshire Yankee Division (the " Agent"), as its agent:for the purpose of: (a) signing, executing, acknowledging and filing with the NRC any andlall applications, documents and information l Y)' J (, '(including amendments thereto) which are now or may become necessary which said Agent deems necessary or desirable in connection with Seabrook Station -(including but not limited to,
'the operating licenses and other lice.tses required.for the L Station by.the Atomic Energy Act of 1954, as amended) and in :
l' L connection with NAESCO's assumption'of responsibility for the management, operation and. maintenance of Seabrook Station; and (b) acting for and on its behalf in any hearing, appeal or-g other proceeding with respect to said operating license and-other 1 - licenses, or the taking of action necessary or incidental thereto O
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-O s-U or any action deemed necessary or desirable by said Agent in connection with the foregoing.
t i NORTH ATLANTIC ENERGY SERV' ICE COMPANY By: M A /T dsL Northeast Utilitiesr$ervice Company, Its Agent By: John F. Opeka
Title:
Executive Vice President \~ VERIFICATION l State of Connecticut: ss: d4A.h.1. //nw>t_ A f t ( , 1990
-r-County of h[r)d.- :
Then personally appeared before me NOA.A 6 OALOh//iMM W/'l Mb V who, being duly sworn, did state that he is of Northeast Utilities Service Company (NUSCO), acting as agent for North Atlantic Energy Service Company-(NAESCO), one of the
' Applicants herein, that he has read the foregoing information relating to such Applicant contained in the Application, and that the statements contained therein relating to such Applicant are true to the best of his knowledge and belief, and further that NUSCO is duly authorized to act on behalf of NAESCO as-its agent.
AnNotary ' u %Tublic SLuctww ~
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My Commission expires: } g
t; EXHIBIT-H . ':
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THE CONNECTICUT LIG..T'AND' POWER COMPANY -j
' Statement of Gross Operating Revenues Twelve Months Ending' September 30, 1990 l
=(In' Thousands) ,
Residential' $ '791,553 Commercial- 671,405-Industrial 315,335 1 Other Utilities 29,230
.Streetlighting and Railroads 31,704 , Miscellaneous 49,196 ;
__________ - .i Total $1,888,423 [
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1 L EXHIBIT I e~ J 1 E
< L I)MHtTHliAST UTII.ITIl!S
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1990 Annual Meeting of Shareholders
It is my pleasure to invite you to attend the 1990 Annual Meeting of Shareholders of Northeast Utilities. The meeting will be held on Tuesday, May 22,1990, at 10:00 a.m. at La Renaissance in East Windsor, Connecticut, which is located at Exit 45 (Warehouse Point Ellington Exit) of Interstate 91 (see map on reverse side). Information concerning the matters to be acted upon at the meeting is provided in the accompanying Notice of Annual Meeting and Proxy Statement. In addition, our meeting agenda willinclude a d!scussion of the operations of Northeast Utilities' system companies
-i -
and a question and answer period. G Whether or not you plan to attend the meeting, it is importarn that you complete, date, sign and return your proxy in the enclosed envelope as soon as possible. This will ensure that your shares will be represented at the meeting in accordance with your wishes. Very truly yours, William B. Ellis Chairman of the Board and Chief Executive Officer March 24,1990
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DIRECTIONS TO LA RD4AISSANCE Frcm Springfield Area: 191-south to Exit 45 , La Renaissance on the righ, < 1 left on Route 140 and go to top of hill. Right at light on Route 5 to y yf '* w
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From Hartford Area: l 91. north to- Exit 45-Turn rignt on Route 140 to first traffic light. Right at light on Route 'S to La Renaissance on the right. l l l r (
t NOTICE OF ANNUAL MEETING OF SHAREHOLDERS To be Held on May 22,1990 To the Shareholders of Northeast Utilities: The Annual Meeting of Shareholders of Northeast Utilities will be held on Tuesday, May 22.1990, at 10:00 a.m. at La Renaissance in East Windsor, Connecticut, which is located at Exit 45 (Warehouse Point- Ellington Exit) of Interstate 91, for the following purposes:
- 1. To fix the number of Trustees at fifteen;
- 2. To elect thirteen Trustees for the ensuing year;
- 3. To ratify the selection of Arthur Andersen & Co. as independent auditors for 1990; and
- 4. To transact any other business that may properly come before the meeting or any adjournment thereof. (
Only shareholders of record at the close of business on March 23,1990 are entitled to receive notice of and to vote at the meeting or any adjournment thereof. You are cordially invited to be present at the rneeting and to vote, if you are unable to attend the meet ng, olease complete, date and sign the enclosed proxy and return it in the envelope enclosed for that purpose. E By order of the Board of Trustees, c W M d TM- *
' Watter F. Torrance, Jr.
107 Selden Street Berlin, Connecticut Secretary Malling Address: Post Office Box 270 Hartford, C.onnecticut 061410270 March 24.1990 IMPORTANT , Shareholders can help avoid the necessity and expense of follow up letters to l; ensure that a quorum la present at the annual meeting by promptly returning tm enclosed proxy. The enclosed envelope requires no postage, if mailed in the United States. l 5 n i- .m a
1 PROXY STATEMENT ) The accompanying proxy is solicited on behalf to receive notice of and to vote at the meeting or l
/ of the Board of Trustees of Northeast Utikties (the any adjournment thereof. On that date there were l \ Association) for use at the Annual Meeting of 108,669,106 common shares outstanding. Each ! Shareholders to be held on May 22,1990, and at such share is ent:tled to one vote.
I any and all adjournme* thereof. The principal office of the Association is located Please read this proxy statement and fillin, date, at 174 Brush Hill Avenue, West Springfield, Mas. Sign and return the enclosed form of proxy. The sachusetts. The general office of the Association proxy may be revoked at any time before it is and its subsidiaries is located at 107 Selden voted by a writing filed with the Secretary of the Street, Berlin, Connecticut (mailing address: Post Association or by a duly executcJ proxy bearing Office Box 270, Hartford, Connecticut 06141-a later date. Properly executed proxies not re- 0270). This proxy statement and the accompny-voked will be voted according to their terms. ing form of proxy are being mailed to shareholders Only holders of common shares of record at the commencing March 24,1990. close of business on March 23,1990 are entitled l
- 1. NUMBER OF TRUSTEES 2, ELECTION OF TRUSTEES Unless a shareholder specifies otherwise, the posal to acquire Pubhc Service Company of New
- enclosed proxy will be voted to fix the number of Hampshire (PSNH), and the creation of vacancies Trustees for the ensuing year at fifteen (15) and to will permit the Board to honcr that commitment elect as Trustees the thirteen (13) nominees without delay, if the acquisition is completed be-named below to serve until the next Annual Meet- fore the 1991 Annual Meeting. In addition, the ing and until their succ(ssors have been elected availability of vacancies will provide an opportunity g and shall have qualified. Each of the nominees has to add to the Scard any other person or persons l previously been elected as a Trustee by the share. whose background and experience would be par-(
holders. If one or more of the nominees should ticularly helpful to the Association in deahng with become unavailable for election, the proxy may be issues that confront it and its subsidiaries. As of voted for a substitute person or persons. How- the date of this proxy statement, the Trustees have ever, there is no reason to anticipate that any of not selected any candidates to fill the vacancies the nominees will not be available. on the Board that would be created by the election of fewer Trustees than the full number fixed by the The Association's Declaration of Trust provides shareholders. that, if a vacancy shall exist in the Board of Tre tees by reason of failure to elect a full Board at a Get forth below is each nominee's name, age, meeting of shareholders, a new Trustee to fill such date first elected as a Trustee, number of shares vacancy shall be elected by the remaining Trus- of the Association beneficially owned as of Febru-tees. The Trustees propose the election of less ary 28,1990 (each nominee has sole voting and than a full Board at the 1990 Annual Meeting. The investment power with respect to the listed shares Association has committed to provide representa- unless otherwise noted), and a brief summary of tion on the Board of Trustees oy New Hampshire the nominee's business experience during the residents in connection with the Association's pro- past five years. RICHARD L. CREVIS10N (65 years) 1985 330 Shares
- Until February 29,1990, Chairman and a Director of NESB Corp., New London, 9 Connecticut and its subsidiary banks, New England Savings Bank and OmniBank of Connecticut. He is a Trustee of Lawrence and Memorial Hospitals, Inc., and a e
Trustee of Connecticut College and Mitchell College. He has served as Chairman of Savings Bank Life Insurance Company of Connecticut and the Savings Bank Asso-ciation of Connecticut.
" DONALD W. DAVlS b (68 yosts) 1969 700 Sharos Chairman of the Executive Committee and a Director of The Stanley Works, New l
l Britain, Connecticut (tools, hardware and industrial products). Mr. Davis is also 9 j Director of Allied Signalinc., The Dexter Corporation, Pitney Bowes Inc., New Britain l General Hospital, Connecticut Public Te!cvision, the National Captioning Institute and i the National institute for Dispute Resolution. He is Chairman of the Finance Commit-tee of the National Association of Manufacturers and Vice Chairman of the University l of Hartford's Board of Regents. I DONALD J. DONAHUE l (65 years) 1983 1,380 Shares l Chairman, Magma Copper Company, San Manuel, Arizona. Previously Chairman.
- Chief Executive Officer and a Director of The Continental Group,Inc. He is a Director j ,
of North American Company for Life and Health, Counsellors Fund and Finevest
- j Foods,Inc. He is e member of the Board of Directors of Georgetown University and i
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l . Vice Chairman of the Greenwall Foundation. L' WILLIAM B. ELLIS (49 years) 1977 15,753 Shares (1) Chairman of the Board and Chief Executive Officer of Northeast Utilities and Chair-l man, Chief Executive Officer and a Director of its principal subsidiaries and of Con-l necticut Yankee Atomic Power Company. He is Vice President and a Director of Connecticut Economic Development Corporation, Inc., and a Director of Nuclear Electric Insurance Limited, Connecticut Mutual Life Insurance Company, Bank of New England Corporation, Hartford Hospital, and the Greater Hartford Chamber of Commerce. He is also Chairman and a Director of Connecticut Business and Indus. try Association,Inc. BERNARD M. FOX ! (47 years) 1986 12,C20 Shares (1)(2) President and Chief Operating Officer of Northeast Utilities and Presider't and Chief
. Operating Officer and a Director of its principal subsidiaries and of Connecticut
! \ - Yankee Atomic Power Company. Mr. Fox is a Director of Vermont Yankee Nuclear Power Corporation, Yankee Atomic Electric Company and Maine Yankee Atomic Power Company. He is also a Director of The Connecticut National Bank, GroupAmerica (a subsidiary of Connecticut Mutual Life insurance Company), The Institute of Living and Mount Holyoke College. Mr. Fox is a Fellow and Founder of the American Leadership Forum, Chairman of the Hartford Corporate Advisory Com-mittee of the Connecticut Speciat Olympics, Chairman of the Open Hearth Capital Campaign, Chairman of Leadership Greater Hartford and a Scnior Member of the Institute of Electrical and Electronic Engineers. l GEORGE B. HARVEY (58 years) 1983 973 Shares , I, Chairman of the Board, President, Ch:ef Executive Officer and a Director of Pitney l Bowes Inc., Stamford, Connecticut (mailing and office products, business supplies j and financial services). Mr. Harvey is a Director of Norton Company, McGraw Hill,
- inc., Bank of New England Corporation and Connecticut Mutual Life insurance Com- ,
f l pany. He is also a member of the Board of Overseers of the Wharton School of the University of Pennsylvania. ) 2
1 6 l EUGENE l'. JONES (65 years) 1973 1,738 Shares Senior Vice President, Greiner Inc., Watlingford, Connecticut (consulting engineers). Mr. Jones st ved as Chairman of the American Society of Civil Engineers' Commit-O tee on the Ecocomic Status of the Civil Engineer and Chairman of the American Consulting Engineers Council's Committee on New Towns and Urban Development and its Task Force on Minority Employment. He is a technical transportation advisor to the Office of Technology Assessment of the United States Congress, a member of the Accreditation Board for Engineering and Technology and a Trustee of Clarkson University. He is a licensed Professional Engineer in several states. ELIZABETH T. KENNAN (52 years) 1960 715 Shares President of Mount Holyoke College, South Hadley, Massachusetts, and President of Five Colleges, incorporated. Mrs. Kennan is a Director of Berkshire Life Insurance Company, Shawmut Bank, N.A., NYNEX Corporation and the Council on Library Resources. She is a Trustee of the University of Notre Dame and a member of the Indo U.S. Subcommission on Education and Culture of the American Secretariat and the Council on Foreign Relations.
. )
DENHAM C. LUNT, JR.
^
(64 years) 1973 2,771 Shares (3)
# Chairman, Chief Executive Officer and a Director of Lunt Silversmiths. Greenfield.
' Massachusetts, and a Director of Lamson and Goodnow Manufacturing Company p and Heritage Cutlery, Inc., both subsidiaries of Lunt Silversmiths. Mr. Lunt is a Director of the Shawmut Bank of Franklin County and Berkshire Life Insurance Com-pany. He is a Director and a member of the Executive Committee of the Silver Users O Association, Inc.
BURKE MARSHALL (67 years) 1977 500 Shares Nicholas deb. Katzenbach Professor of Law, Yale Law School, New Haven, Con-necticut. Mr. Marshall is a Director of State Farm Mutual Automobile Insurance
. Company and a member of the Boards of the Robert F. Kennedy Memorial, the Vera institute of Justice and the Center for Community Change.
WILLIAM J. PAPE 11
- (59 years) 1974 1,089 Shares a Publisher, Waterbury Republican and American, Waterbury, Connecticut (newspa-7 pers). Mr. Pape is President and Treasurer of American-Republican Inc. He is a g ( Director of Bank of Boston Connecticut, Platt Bros. and Co., and Paper Delivery,Inc.
's He is a Trustee of Post College and the Waterbury Y.M.C.A.
h o . 3 iuuIu'u
NORMAN C. RASMUSSEN
- h>. (62 y:ars) 1977 500 Sh:r:s Professor of Nuclear Engineering, Massachusetts Institute of Technology, Cam.
WD
' bridge, Massachusetts, Mr. Rasmussen is Chairman of the M.I.T. Reactor Safe-guards Committee, From 1972 through 1975 he directed the Reactor Safety Study
(~ i for the Atomic Energy Commission. He served on former President Ford's Advisory Committee on Technology and Economic Strength and was appointed by former President Reagan to the National Science Board, on which he served from 1982 through 1988 He serves on the Scientific Advisory Board for the Three Mile Island Unit 2 Clean Up Fund, is a member of Princeton Plasma Physics Laboratory Visiting , Committee, and is CWrman of the Cabot Corporation LNG Safety Committee. He is a Fellow of the American Nuclear Society and the Health Physics Society and a member of the National Academy of Engineering and the National Academy of Science, in 1989, Mr. Rasmussen was appointed to the Presidential Commission on Catastrophic Nuclear Accidents. He is a licensed Professional Engineer in Massa-chusetts. l ALBERT E. STElGER, JR. p .g (67 years) 1974 1,000 Shares l President, Chief Executive Officer and < Director of Albert Steiger,Inc., Springfield,
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, Massachusetts (department store chain). Mr. Steiger is a Director of Frederick At-kins,Inc. and a Director and member of the Investment Committee of Massachusetts Mutual Life insurance Company. He is a Vice President, Trustee and member of the
, Board of Investment of Spnngfield institution for Savings. He is a Director of Spring-field Central, Inc., Better Homes for Springfield, Inc. and Westmass Area Develop-l<e, '
ment Corporation. He is President and a Director of Albert Steiger Memorial Fund, Inc. and Chairman of the Investment Committee of Baystate Medical Center, l I
- 1) The shares beneficially owned by Messrs. Ellis and Fox include 6,370 and 4,461 shares, respectively, held for their benefit under tne Association's Tax Reduction Act Employee Stock Ownership Plan l (TRAESOP), Payroll Based Employee Stock Ownership Plan (PAYSOP) and Executive incentive Compensation Program (EICP). In accordance with the terms of those plans, Messrs. Ellis and Fox have voting, but not investment, power over those shares.
(2) Mr. Fox shares voting and investment power with his wife for 2,631 shares, and he has sole voting and investment power for 995 shares, which he owns as custodian for his children. (3) Mr. Lunt shares voting and investment power for 2,271 shares with a banking institution under an indenture, i f The Board of Trustees recommends that shareholders vote to fix the number of Trustees at fifteen and FOR election of the thirteen nominees listed above, j s l lO r 4
, _n n eo &% M 1990, the nominees for PAYSOP and EICP. The executive officers of the
W 4 , f e executive officers of the Associa- Association have voting, but not investment, e att e a p :p, Ganeficially owned 93,592 com- power over those shares. The Association is not
{ d4 W Nh W% of pe Association, which is less than aware of any individual or group owning more 1 percent of the common shares outstanding. Of than 5 percent of the Association's outstanding the shares beneficially owned by the Association's common shares. The Association has no other exec @ve officers as a group,39,608 shares are class of voting secunties. held for their benefit under the TRAESOP, COMMITTEE COMPOSITION AND RESPONSIBILITY The Board of Trustees of the Association has munity significance. The Committee met four times Audit, Executive, Finance and Corporate Respon. in 1989. The members of the Committee are Mrs. sibility Committees, a Committee on Organization, Kennan (Chairman) and Messrs. Harvey, Jones, ComMnsation and Board Affairs and an ad hoc Marshall, Pape and Rasmussen, none of whom is Task Force on the acquisition of PSNH. The Board an employee of the Association or its subsidiaries of Trustees does not have a Nominating Commit-tee. The Committee on Organization, Compensation and Board Affairs reviews and adjusts as appro-The Audit Committee meets independently with priate the compensation policies of the Associa- I the internal and independent auditors of the Asso- tion and its subsidiaries. As part of this responsi. ciation and its subsidiaries to review the auditors' bility, the Committee makes recommendations to activities, procedures and recommendations. Fol- the Board of Trustees regarding compensation for lowing each meeting, the Committee reports to the the Chairman of the Board and the President. The Board. The Committee recommends annually the Committee is also responsible for reviewing pok-appointment of the Association's independent au- cies affecting the organization of the Association (3 ditors for the coming year. The Audit Committee and its subsidiaries. The Committee on Organiza. () met three times in 1989. The members of the tion, Compensation and Board Affairs met three Committee are Messrs. Donahue (Chairman), times in 1989. The members of the Committee are Creviston, Jones, Marsnall, Rasmussen, Steiger Messrs. Davis (Chairman), Harvey, Jones, Lunt, and S. Caesar Raboy. Mr. Raboy is a Trustee who Pape and Raboy and Mrs. Kennan, none of whom has elected not to stand for re election, No Com- is an employee of the Association or its subsidiar. mittee member is an employee of the Associe^ ion ies. or its subsidiaries. In June,1989, the Board appointed an ad hoc The Executive Committee is empowered to ex. Task Force on the acquisition of PSNH. The lask ercise all the authority of the Board, subject to Force's primary responsibility is to provide guid-certain limitations prescribed in the Association's ance and counsel to management in connection Declaration of Trust, during the intervals between with the Association's efforts to acquire PSNH. meetings of the Board. The Committee met four lhe Task Force met five times in 1989. The mem. times in 1989. The members of the Committee are bers of the Task Force are Messrs. Davis, Messrs. Ellis (Chairman), Davis, Donahue, Fox, Donahue, Harvey, Marshall and Steiger, none of Harvey, Lunt, Pape and Steiger. whom is an employee of the Association or its sub-sidiaries. The Finance Committee reviews and makes recommendations as to financial matters that may in 1989, the Board of Trustees held 14 meet. affect the Association and its subsidianes. The ings. Committees of the Board held a total of 21 Committee met two times in 1989. The members meetings. All members of the Board of Trustees, of the Committee are Messrs. Elks (Chairman), except Mr. Harvey, attended 75 percent or more Creviston, Donahue, Fox, Lunt, Marshall, Ras- of the aggregate number of meetings of the Board mussen and Steiger. and the committees of which they were members. (n') The Corporate Responsibihty Committee re-While Trustees make every effort to attend meet-ings of the Board and committees of which they views the pobcies and practices of the Association are members, there are instances when, for com. and its subsidiaries that have broad social or com- pelhng reasons, they are unable to attend those 5
meetings. The Board of Trustees believes that at- meaningful indicator of the quality or importance tendance p2rcentage information is not of itself a of a Trustee's contribution to the Board. . COMPENSATION OF TRUSTEES AND EXECUTIVE OFFICERS COMPENSAYlON OF TRUSTEES During 1989, each Trustee who was not an were compensated at an additional annual rate of employee of the Association or its subsidiaries $2,500. Pursuant to a deferred compensation plan was compensated at an annual rate of $14,000, for Trustees established by the Board in 1980, Mr. plus $700 for each meeting of the Board or its Marshall elected to defer payments for his 1989 committees, including the PSNH Task Force, at. service as a Trustee until termination of his service tended. The Chairmen of the Audit and Corporate as a Trustee, at which time he will receive his de-Responsibility Committees and the Committee on ferred compensation in five annualinstallments. Organization, Compensation and Board Affairs CASH COMPENSATION OF EXECUTIVE OFFICERS All cash compensation paid in 1989 to each of the five highest paid executive officers of the Association and its subsidiaries, and to all executive officers of the Association and its subsidiaries as a group, appears below. Capacitke in Ceeh Name of indMdual Which Served (1) Componestion (2) William B. Ellis Chairman of the Board and Chief $ 518,211 Executive Officer of Northeast Utilities Bernard M. Fox President and Chief Operating $ 323,325 Officer of Northeast Utilities OJohn F. Opeka Executive Vice President of $ 234,353 Northeast Utilities Service Company Walter F. Torrance, Jr. Senior Vice President, Secretary 5 205,545 and General Counsel of Northeast Utilities John P. Cagnetta Senior Vice President of Northeast $ 181,801 Utilities Service Company All executive officers of Northeast Utilities and its subsidiaries, as a $2,583,913 group, consisting of 13 individuals in 1989 i (1) Each of the named individuals also served as an executive officer and as a director of various subsidiaries of the Association. ! (2) " Cash Compensation" consists of salaries paid by Northeast Utilities Service Company, including any salary that may have been deferred during 1989 under the Northeast Utilities Service Company Supplemental Retirement and Savings Plan and the Deferred Compensation Plan for Officers of Northeast Utilities System Companies (Deferred Compensation Plan). " Cash Compensation" also includes cash awards made in 1989 under the EICP, payments made to one executive officer consti. , tuting interests on amounts deferred in previous years under the Deferred Compensation Plan and paid in 1989, and certain payments made in connection with the relocation of one executive officer; neither of the latter officers is named in the above table. No executive officer receives benefits under hfe and health insurance plans that are not available generally to all salaried employees. O 6
-. -_ - =. - - -- - . .
9" COMPENSATION PURSUANT TO PLANS Retirement Plan life option and a level income option. Retirement Employees of subsidiaries of the Association, benefits under the Retirement Plan are not reduceo including the executive officers referred to in the by the employee's Social Security benefit. Contri-above table, are entitled to participate in the North, butions, which are actuarially determined, are east Utilities Service Company Retirement Plan, made by the Association's subsidiaries for the ben-which is a noncontributory, defined benefit retire, efit of all employees covered by the Retirement ment plan. Retirement benefits are computed on Plan. the basis of a Dercentage of an employee's final As of December 31,1989, the five most highly average eamings (i.e., an employee's highest av- compensated executive officers of the Association erage annual compensation earned during any 60 or its subsidiaries had the following years of cred-consecutive months in the 120 month period pre- ited service for retiremen* compensation pur-ceding retirement) multiplied by the employee's poses: Mr. Ellis-13, Mr. Fox-25, Mr. Opeka-years of credited service. The Retirement Plan 19, Mr. Torrance-11 and Dr. Cagnetta-17. As-provides for several optional forms of benefit pay- suming that retirement occurs at age 65 for these ments, including a straight life annuity option, a officers, ietirement will occur with 29,43,35,14 contingent annuitant option, a ten year certain and and 25 years of credited service, respectively. ANNUAL PENSION FOR YEARS OF SERVICE INDICATED The following table shows the estimated annual retirement benefits payable assuming that retirement occurs at age 65. The benefits as presented are based on a straight life annuity and do not take into account any reduction for joint and survivorship annuity payments. Avere Annual Earnings' for 60 nthe Lost 120 onthe Years of Service Prior to Retirement 15 25 (
$ 75,000
$175,000
$ 16,223 $ 27,038 35 5 37,853 45
$ 41,603 38,723 64,538 90,353 91,103
$275,000 61,223 102,038 " 142,853 " 156,603
$375,000 83,723 " 139,538 " 195,353 " 214,103
$475,000 " 106,223 " 177,038 " 247,853 " 271,603
$575,000 " 128,723 " 214,538 " 300,353 " 329.103
- Under recent changes in the internal Revenue Code, compensation eamed in years after 1988 that is used in calculating retirement benefits under the Retirement Plan is limited to a maximum of $200,000, adjusted for inflation ($209,200 in 1990). This may affect the calculation of " average annual eamings" for certain individuals and effectively reduce their benefits under the Retirement Plan.
" Pursuant to provisions in the Internal Revenue Code, the maximum annual benefit that could be accrued under the Retirement Plan was $98,064 in 1989, and will be $102,582 in 1990. Officers of the Association and its subsidiaries whose accrued benefit under the Retirement Pian would exceed th maximum accrued benefit limit, but for the existence of this limit, are eligible for a supplemental benefit under the Supplemental Executive Retirement Plan discussed below. This w;ll yield them an annual aggregate retirement benefit under the two p!ans as indicated in the table, but even this may not reflect actual compensation because of the $200,000 limit described in the preceding footnote.
Supplemental Executive Retiremer. Plan ment Plan benefits were not subject to certain lim-In 1987;the Association's Board of Trustees es- itations imposed by federal tax law on tax quali-tablished the Supplemental Executive Retirement fied, funded retirement plans and (ii)if awards un. Plan for Officers of Northeast Utilities System der the ElCP were included in benefit calculations Companies (the Supplemental Plan). The Supple- under the Retirement Plan. merc' Plan is an unfunded plan that provides offi. cers o' the Association and its subsidiaries with TRAESOP/PAYSOP the benefits that would have been provided to The Northeast Utilities Service Company them under the Retirement Plan (i) if the Retir+ TRAESOP and PAYSOP (collectively the Plans) i 7
are two defined contnbution plans under each of retirement, death, total disabikty or termination of employment. The 401(k) Plan also provides for which common shares of the Association have been contributed to or purchased by a trust and withdrawals prior to termination of employment, subject to specified conditions and limitations. O areble being employees. held Contributions by a trustee to the Plans for the benefit have of eligi-In 1989 Northeast Utilities Service Company been suspended, and the Plans are effectively fro-contnbuted $3,154, $2,970, $2,844, and $2,533 zen. No contributions were made to the Plans dur- to the 401(k) Plan accounts of Messrs. Fox, ing 1989.The officers of the Association, including those named in the foregoing table, have interests Opeka, Torrance and Cagnetta, respectively. Mr. Elks did not participate in the 401(k) Plan in 1989. in common shares of the Association and its sub- Northeast Utilities Service Company contributed a sidiaries held under the Plans as described on total of $27,137 to the 401(k) Plan accounts of pages 4 and 5. These shares generally may not be those executive officers who parti 0ipated in the distributed until the termination of their employ. plan in 1989. No executive officer is entitled to a ment. benefit undor the 401(k) Plan that is not generally available to all employees who meet the plan's Supplemental Retirement and Savings Plan service requirements The Northeast Utilities Service Company Sup-piemental Retirement and Savings Plan (the Deferred Compensation Plan [ 401(k) Plan) is a defined contribution plan that is designed to provide eligible employees with a The Deferred Compensation Plan permits offs means of saving for retirement through regular cers of the Association and its subsidiaries to de-payroll contributions. Participating employees may fer receipt of up to 75 percent of their salary com. contribute, with certain restrictions, up to 13 per- pensation until (i) termination of empig ment or (ii) ~ cent (10 percent prior to March 1,1990) of their any other date that is subsequent to the year in annual salary, which will be invested in accor- which the deferred compensation is earned. inter-dance with the employee's instructions in (1) a est is paid on deferred compensation at the statu. Northeast Utilities common shares fund, (ii) a tory ir,terest rate in Connecticut, which is currently set at 8 percent. Compensation earned by execu-
.O guaranteed fixed income fund,(iii) a pooled equity tive officers in 1989 but deferred to future years is fund or (iv) a combination of these investments. A before tax savings feature of the 401(k) Plan per- included in the Cash Compensation Tabte set forth mits participating employees to have their salaries above.
reduced by the amount of their contribution and thereby allows them to lower their income tax lia-bility for the year in which contributions are made, The EICP is designed to help attract and retain in addition to employee contributions to the 401(k) executives of high ability and to strengthen the ex-Plan, each subsidiary of the Association employ-tent to which executives identify with the goals of ing a participating employee contributes, out of current or accumulated eamings, an amount equal the Association. to one half of up to the first 3 percent of compen. The EICP consists of two parts: a Short Term sation that the employee contributes to the 401(k) Program and a Long Term Program. Under the Plan on a before tax basis. Short Term Program, corporate goals and individ-To be eligible to participate in the 401(k) Plan, ual goals are set annuaHy and achievement of the employees must have at least one year of service goals is measured, and awards made, after one with one or more of the subsidiaries of the Associ- year. Each award under the Short Term Program is made in common shares of the Association, ation and Connecticut Yankee Atomic Power Company. Employees are at all times vested in which shares are forfeited to the Association if the their own contributions to the 401(k) Plan. Employ- participant does not remain in the employ of a sub-ees vest in their portion of the contributions to the sidiary of the Association until at least January 1 401(k) Plan ty tnn participatiry subsidiaries of the of the third year after the year for which the award Association at 'he rate of 20 percent for each year is made, unless employment is terminated earlier O of service. The distribution to an employee of amounts held in his or her 401(k) Plan account will by death, disability, retirement, or other excusable cause. Under the Long Term Program, goals are generally be made as soon as practicable after set annually but are based on results over a se-8
lected period of at least 3 years, with achievement Association and its subsioiaries received the fol. of goals measured, and awards made, at the end lowing number of shares related to the 1986 Short of the period. Awards under the Long Term Pro. Term Program: Mr. Ellis-2,800, Mr. Fox-1,430 O gram are made in cash. No awards may be made Mr. Opeka-1,257, Mr, Torrance-1,405, and Dr. V under either program if certain minimum goals are Cagnetta-1,333. On January 1,1989, all execu-not met. Participants are selected by the Commit- tive officers of the Association and its subsidiaries, tee on Organization, Compensation and Board Af. as a group, received 8,225 shares related to the fairs from among the officers of the Association 1986 Short Term Program, and its subsidiaries. The 1989 Long Term Program covers a 3 year Both Short Term. and Long Term Programs were period that began on January 1,1989. The Long in effect for 1989. All executive officers of the As, Term Program goals were based on the Associa. sociation and its subsidiaries were, in addition to tion's relative ranking over this 3 year period certain other officers, selected to participate in against comparable electric utility systems with re-both the Short Term and Long Term Programs. Spect to the enmed rate of return on common eq. Ulty, the market.to book value ratio for the Associ. Under the 1989 Short Term Program, the maxi. ation's common shares, and the cost of service to mum potential total dollar amount of all awards subsidiaries' customers. The maximum amount of was set at 20 percent of the aggregate compen. the dollar award under the 1989 Long Term Pro-sation of all participating officers The aggregate gram wac set at 20 percent of the aggregate 1989 award under the 1989 program will be based on compensation of all officers participating in that the achievement of corporate goals that relate to program. After the end of the 1989 Long Term the Association's return on equity and its relative Program (i.e., after December 31,1991), the rela-ranking on a cost of service basis with compara. tive success of the Association in achieving the ble electric utility systems. To determine individual corporate goals will be determined, which will es. awards, each participant's performance will be tablish the maximum dollar award inat will be allo. evaluated on the basis of the participant's success cable to participants. Individual awards under the in achieving individual goals. Individual awards 1989 Long Term Program will be made to partici. O' will then be made by relating each officer's goal pating off:cers in prc, portion to each participant's achievement and salary to the size of the 1989 salary for the first year of the 1989 Long Term Short Term Program aggregate award. Amounts Program; however, no amounts will be awarded
-that will be awarded to participants in the 1989 until after the end of the 3 year performance pe.
Short Term Program had not been determined as riod the! began on January 1,1989. Awards for of February 28,1990. Restricted common shares the 3 year performance cycle that began on Janu. that were awarded to participants in the 1986 ary 1,1986 and ended on December 31, 1988 Short Term Program became unconditionally were made on May 20,1989. Those awards are vested on January 1,1989. On that date, the five included in the Cash Compensation Table set forth most highly compensated executive officers of the above.
- 3. RATIFICATION OF THE SELECTION OF AUDITORS The firm of Arthur Andersen & Co., independent gaged to assist a subsidiary of the Association in k pubb accountants, was selected by the Board of the design of a major new computer software sys-Trustees, and approved by the shareholders, to tem. The Audit Committee continues to review the serve as independent auditors of the Association nature and scope of these consulting services and and its subsidiaries for 1989. other non audit services and has determined that such services do not affect Arthur Andersen &
. Pursuant to IP,e recommendation of the Audit Co.'s audit independence.
Commitee, the Board of Trustees recommends that shareholders ratify the selection by the Board Representatives of Arthur Andersen & Co. are of Trustees of Arthur Andersen & Co. to audit the expected to be present at the meeting. They will accounts of the Association and its subsidiaries have the opportunity to mako a statement, if they g for 1990. Andersen Consulting, the consulting desire to do so, and to respond to appropriate
, group of Arthur Andersen & Co., has been en- questions raised at the meeting.
The Board of Trustees recommends that shareholders vote FOR this proposal. { s . 9
- 4. OTHER MATTERS The Board of Trustees knows of no matters The Association's Annual Report to Sharehold-other than the foregoing to come before the meet- ers for the year ended December 31,1989,includ-ing. However,if any other matters come before the ing financial statements, is being mai!ed with this meeting, the persons named in the enclosed proxy proxy solicitation material. An additional copy of will vote in their discretion with respect to such the Annual Report will be mailed to any snare-other matters. holder upon request.
COST OF SOLICITATION OF PROXIES The cost of sohciting proxies on behalf of the schcitation of proxies from banks, brokerage firms, Board of Trustees will be borne by the Associa- nominees and individual shareholders for a fee of tion. In addition to the use of the mails, proxies $10,000, plus reimoursement for expenses. Ar-may be so!icited by personal interview, telephone rangements will be made to reimburse brokerage or telegraph by Trustees, officers or employees of firms, nominees, custodians and fiduciaf.es for ex-the Association or Northeast Utilities Service Corn- penses incurred in forwarding solicitation materials 4 pany, or by an independent company, Morrow & to the beneficial owners of common shares held as Co.,Inc., which has been retained to assist in the of March 23,1990. MULTIPLE COPIES OF ANNUAL REPORT TO SHAREHOLDERS Some shareholders with multiple accounts may please mark the designated box on the proxy receive more than one Annual Report to Share. card (s) for the account (s) for which Annual Report holders, which is costly to the Association and mailings may be discontinued. Mailing of divi-may be inconvenient to those shareholders. The dends, dividend reinvestment statements, proxy Association will discontinue multiple maihngs of materials and special notices will not be af'ected Annual Reports to Shareholders, if the affected by an election to dis 00ntinue multiple mailings of shareholders so request. To request discontinu- the Annual Report to Shareholders, ance of multiple mailings of the Annual Report. SH'lEHOLDER PROPOSALS FOR 1991 ANNUAL MEETING To be included in the proxy statement and form ceived by Theresa H. Allsop, Assistant Secretary of proxy for the 1991 Annual Meeting of Share- of the Association, at the Association's general of-holders, proposals by shareholders must be re- fice by November 23,1990. By order of the Board of Trustees, lA) & \? T,rvvs*"-
- Walter F. Torrance, Jr.
Secretary Northeast Utilities will provide shareholders sion, including the financial statements and with a copy of its 1989 Annual Report on Form schedules thereto, without charge, upon re-10 K to the Securities and Exchange Commis- ceipt of a written request sent to: Theresa H. Allsop Assistant Secretary Northeast Utilities P.O. Box 270 Hartford, Connecticut 061410270 0 10
.-.__---_--._-----_.---T
- s fl0RTMEiST CTILITIES ACQUISITIOft
SUMMARY
OF BOTTOMS - ESTIMATE
.OGM COST 4 COMPARISON 01 Mtt'S SEABROOR PROJECTION TO MHY BUDGET (1991 Det.LARS X 1000) .
9P.!'S PROJECTION MMY BU0CET DIFFEREMCE PAYROLL N001-PAYROLL TOTAL PAYR 0t.L MOM-PAYROLL TOTAL PAYROLL N086-PAYROLL ' TOTAL FUNCTION i BENEFITS 0.0 3837.0 3837.0 0.0 8235.0 8235.0 0.0 -4396.0 -4398.0 PEMst0MS 0.0 2738.0 2738.0 _O.0 4927.0 4927.0 0.0 -2189.0 -2189.3 [ PAYROLL TAXES 0.0 3027.0 3027.0 0.0~ 3674.0 3674.0 0.0 -647.0 -647.0 .i IMSURANCE ' O.0 7287.0 7287.0 0.0 9817.0 9817.0 0.0 -2530.0 -2530.0 <
%#0RKERS'COMPEMSATION 0.0 206.0 206.0 0.0 343.0 343.0 0.0 -137.0 -137.0 ACCOUNTING 678.7 48.G 727.3 847.0 614.0 1461.0 -168.3 -565.4 -733.7 ADMINISTRATIVE SERVICES 229.9 35.9 265.8 0.0 940.0 940.0 229.9 -904.1 -674.2 i CORPORATE COMMUNICATIOeIS 450.0 504.0 954.0' 514.0 1545.0 2159.0 -64.0 -1141.0 -1205.0 '
EXECUTIVE MANAGEMENT 155.3 66.9 222.2 339.0 394.0 733.0 -183.7 -327.1 -510.8 . 326.0 273.6 599.6 260.0- 125.0 385.0 66.0 148.6 214.6 , FINANCE GENERAL SERVICES 386.7 1563.3 1950.0 0.0 0.0 0.0 386.7 1563.3 1950.0 HUMAN RESOURCES 538.9 760.7 1299.6 534.0 1677.0 2211.0 4.9 -916.3 -911.4 , INFORMATION SERVICES 1632.5 1292.5 2925.0 2678.0 5066.0 7744.0 -1045.5 -3r73.5 -4819.0 LEGAL 213.5 884.7 1098.2 0.0 1379.0 1379.0 213.5 -494.3 -280.8 .; MISCEll.ANEOUS 0.0 -1897.5 -1897.5 0.0 -2461.0 -2461.0 0.0 563.5 563.5 PURCHASING 257.8 21.0 278.8 384.0 955.0 1339.0 -126.2 -934.0 -1060.2
- TOTAL A ar G
- 4869.3 20648.7 25518.0 5556.0 37330.0 42886.0 -686.7 -16681.3 -17368.0
" MISCELLANEOUS" Bud 9et Category (A&C Expense):
This category includes Adelnistrative & Generet expenses for genersi service company overhead Boeding and capitellzed expenses. These.itees result in e credit adjustment to the OGM budget to reflect payrot t end associated overheads for i people charging to capite t work orders. This budget category elso includes Accounting edjustments for other miscellaneous p3 overhead expenses, essociated with AtG expenses, which are ellocated to the nuclear units. X lI H III H d i r-s-- -- . . . _ - - , , _ _ , _ . ,
r
<P%
NORTHEAST UTILITIES ACQUISITION V l SU89tARY OF BOTTOMS &M ESTIMATE C&M COST COMPARISON OF NU'S SEABROOK PROJECTION TO NHY BUDGET . (1991 DOtt.ARS X 1000) NNY BUDGET OlFFERENCE NU'S PROJECTION PAYROLL NON-PAYROLL TOTAL PAYROLL NON-PAYROLL TOTAL PAYROLL NON-PAYROLL TOTAL FUNCTION -2091.0 -5306.0 25771.0 35879.0 61650.0 -3215.0 NUCLEAR OPERATIONS 22556.0 33788.0 56344.0 13568.0 23755.0 37323.0 -4601.0 -6157.0 -10758.0 NUCLEAR & ENVIR.ENCRC. 8967.0 17598.0 26565.0 4608.0 11047.0 15655.0 -839.0 -7638.0 -8477.0 3769.0 3409.0 7178.0 CEN.ENGRG.& CONSTRUCTION -2505.2 0.0 0.0 0.0 335.8 -2841.0 335.8 -2841.0 -2505.2 l OTHER
--- -- -=
-8319.2 -18727.0 -27046.2
- 35627.8 51954.0 87581.8 43947.0 70681.0 114628.0
- TOTAL PRODUCTION --- -------- -------- -------- --------
......-- ....--.- ------ - -9005.9 -35408.3 -44414.2
- 40497.1 72602.7 113099.8 49503.0 108011.0 157514.0
- TOTAL OPERATIONS & MAINTENANCE l
"0THER" Budget Category (Production Expense /Non-A&G):
f for support service functions, such as Purchasing, IRG, Corporate This category includes production e<penses (non-AAC)It also includes e credit adjustment, to the incrementa s refueling outage Communications, R&D, and Electronics Testing. leveltzed refueling outage expenses used In MU's costs included In MU's Preliminary 1901 Seabrook O&M Budget, to reflect head OaM synergy calculations. This budget category also includes Accounting adjustments for the other miscellaneous over expenses, associated with production (non-A&G) expenses, which are allocated to the nuclear units. l l I
i o (~) v l EXHIBIT K PROPOSED FORM OF NOTICE (RELEASE NO. ] PROPOSED ORGANIZATION AND CONDUCT OF BUSINESS OF NORTH ATLANTIC ENERGY SERVICE COMPANY, ISSUANCE AND SALE OF SECURITIES IN CONNECTION THEREWITH TO NORTHEAST UTILITIES, AND REQUEST FOR EXEMPTION FROM COMPETITIVE BIDDING
, 1991 Northeast Utilities ("NU") , a holding company registered under the Public Utility Holding Company Act of 1935, as amended (the "Act"), Northeast Utilities Service Company ("NUSCO") , a service company subsidiary of NU, Yankee Atomic Electric Company
("YAEC"), an electric utility company subsidiary of NU, and North Atlantic Energy Service Company ("NAESCO), a to-be-formed ( electric utility company and service company subsidiary of NU, (_3) have filed an application / declaration with t'.11s Commission pursuant to Sections 6(a), 7, 9 (a) , 10 and 13 of the Act and Rules 43, 50 and 86 through 95 thereunder. NU is located at 174 Brush Hill Avenue, West Springfield, Massachusetts 01090-0010, NUSCO is located at 107 Selden Street, Berlin, Connecticut 06037-0218, YAEC is located at 580 Main Streat, Bolton, Massachusetts 01740, and NAESCO will be located at Route 1, Lafayette Road, Seabrook, New Hampshire 03874. Authorization is requested for the organization and conduct of business of NAESCO, the issuance and sale to NU of all of NALSCO's only class of common stock, the acquisition of that stock by NU, and other related transactions : and activities. The organization, capitalization and conduct of business of NAESCO is a part of NU's plan to acquire Public Service Company of New Hampshire ("PSNH") , which acquisition, and certain security issuances and other transactions in connection therewith, were the subject of NU and NUSCO's application / declaration in File No. 70-7695. That acquisition and certain of the transactions related thereto were approved by the Commission in Holding Company Act Release No. 25221-issued on December 21, 1990. The application / declaration in this matter only seeks approvals and authorizations related to the organization, capitalization and conduct of business of NAESCO. All other aspects of NU's proposed acquisition of PSNH requiring Commission approval are discussed in the application / declaration ()#
'- in File No. 70-7695.
1
--. ---- ~. - . . - - - - _ - . . - - _ _ . . - - - _ . - . . _ . - .
1 J O PSNH, the owner _of a 35.6 percent interest in the Seabrook Unit No. 1 nuclear power plant (" Se abrook" ) , is currently authorized under U.S. Nuclear Regulatory Commission ("NRC") Operating License NPF-86 to manage, operate and maintain Seabrook on behalf of itself and the 11 other joint owners of the unit (collectively, the " Joint Owners"), and since 1984 it has performed those functions for Seabrook through its New Hampshire Yankee Division ("NHY"). After suffering through financial problems for most of the 1980s caused in large part by its sizeable investment in Seabrook, PSNH filed in United States Bankruptcy Court, District of New Hampshire (the " Bankruptcy Court"), in January, 1988 a petition seeking protection from its creditors under Chapter-11 of the United States Bankruptcy Code. NU became interested in acquiring PSNH, and, after intense negotiations, NU gained the support of PSNH's equity. security holders, unsecured creditors and the holders of a majority of its third mortgage bondholders for its plan of reorganization for the company (the " Plan"). PSNH and the State of New Hampshire also endorsed the Plan, and on April 20, 1990, the Bankruptcy Court confirmed the Plan. The Plan contemplates, inter alia, the transfer of PSNH's interest in Seabrook to North Atlantic Energy Corporation ("NAEC"), a to-be-formed wholly-owned subsidiary of NU, and the assumption by a wholly owned subsidiary of NU (wh1ch will be NAESCO) from NHY of the responsibility for managing, operating and maintaining Seabrook and supervising the disposition of O_ Seabrook Unit No. 2, a cancelled nuclear unit on the same site as Seabrook. NAESCO will not have an ownership interest in Seabrook or Seabrook Unit No. 2 or an entitlement to any of the capacity or energy therefrom. Seabrook received its full power license from'the NRC in March, 1990, was synchronized to the New England grid on May 29, 1990, and successfully completed power ascension testing in August,-1990. NAESCO W111 be organized as a New Hampshire corporation, wholly owned and controlled by NU, and-its only business will be providing managerial, operational and maintenance services to the Joint Owners pursuant to a Managing Agent-Operating Agreement - (the MAOA"), a Disbursing Agent Agreement (the "DAA") and a presently existing Joint Owners Agreement (the "JOA"). NAESCO's ' only associate company customers will be NAEC and The Connecticut Light and Power Company, which owns an approximately 4 percent interest in Seabrook. It.is presently contemplated that NAESCO will have only one outstanding security, $1 par value common stock, of which 1,000 shares will be authorized and issued to NU. 4 The material terms of the MAOA and the DAA and certain proposed modifications to the present OJA were spelled out in a July 19, 1990 agreement among NUSCO, act;ng on behalf of NAESCO, _vO. and the New England Power Company, CL&P, PSNH, The United Illuminating Company and Canal Electric Company. Under the terms of that agreement, NAESCO will assume the responsibility for
managing, operating and maintat.ning Seabrook and for supervising (s the disposition of Seabrook Unit No. 2 at 11:59 p.m. of the last day of the calendar month in which all federal, state and local regulatory approvals necessary for the implementation of that agreement have been obtained, regardless of whether NU has accomplished its acquisition of PSNH at that time. The regulatory approvals required to implement the agreement are those from the Commission, the NRC and the New Hampshire Public Utilities Commission. The Joint Owners who have already executed the July 19, 1990 agreement collectively own a sufficient interest in Seabrook to effect the change in managing agent from NHY to NAESCO. The MAOA, DAA and JOA will articulate NAESCO's responsibilities with respect to Seabrook and Seabrook Unit No.
- 2. Under the MAOA, NAESCO will have responsibility for the day-to-day management, operation and maintenance of Seabrook. Under the DAA, NAESCO will maintain a bank account or accounts into which it shall deposit the funds it receives from the Joint Owners in payment of its expenses. NAESCO will bill the Joint Owners at cost for the expenses it incurs in performing its duties under those agreements, and because NAESCO will perform no work other than that related to Seabrook and the disposition of Seabrook Unit No. 2, there will be no need to allocate indirect Costs.
() The MAOA will give to NAESCO the authority to appoint or retain a service company or agent with which it is affiliated to perform its responsibilities under the MAOA and JOA, subject to the approval of at least three unaffiliated Joint owners with an aggregate ownership interest in Seabrook of at least 60 percent. It is presently contemp3ated that NAESCO will enter into two such agreements, one with NUSCO and the other with YAEC. NUSCO will provide NAESCO with administrative, general and technical services It is presently contemplated that YAEC will continue to provide NAESCO with the type of engineering and technical functions it now provides under an existing contract with NHY. Both NUSCO and YAEC will perform their services at cost, which, because of the size of their organizations and the opportunities for economies of scale, will be less than those services would cost NAESCO if it were to perform them itself. Both companies will allocate costs directly to NAESCO whenever possible, and when expenses are not directly assignable to NAESCO, they will allocate those costs among their customer companies in a fair and equitable manner consistent with the requirements of the Act and approved by the executive committee of the Joint Owners. The applicants state that they intend to request the Commission's approval, pursuant to the application / declaration, of all transactions connected to the organization, capitalization and conduct of business of NAESCO and the service contracts with p' NUSCO and YAEC, whether under the enumerated sections of the Act and the rules thereunder or otherwise.
The application / declaration and any amendments thereto are O availatle for pLulic inspection through the Commission's Office of Pur:1c Reference. Any interested persons wishing to comment or re4cest a hearing on the application / declaration 1991, shouldto the submit tatir views in writing by , Secretary, Securities and Exchange Commission, Washington, D.C. 20549, and serve a copy on the applicants at the addresses specified above. Proof of service (by af fidavit or, in the case of an attorney at law, by certificate) should be filed with the request. Any request for hearing shall identify specifically the issues of fact or law that are disputed. A person who so requests will be notified of any hearing, if ordered, and will receive a copy of any notice or order issued in this matter. After said date, the application / declaration, as filed or as it may be further amended, may be granted. For the Commission, by the Division of Investment Management, pursuant to delegated authority. O O
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m... . __ _ . . . _ -- . _ __ _ _ _ _ _ _ - . _ _ . _ _ _ _ _ . _._. . _ .. _ .. Financia .stement 3.1 . ; Page 1 of ; f-YANKEE ATOMIC ELECTRIC COMPANY Balance Sheets September 30, 1990 (Unaudited) ASSETS Utility plant, at original cost: Electric $94,435,267 Less: accumulated provision for depreciation 80,323,629 14,111,638 Construction work in progress 11,4J9,893 Nuclear fuel, at amortized cost 19,647,698 Net utility plant 45,199,229 Other property and. investments: Non-utility property, net of accumulated provision for depreciation 746,452 Other 1,507,231
...i. i.
47,310,931- - Decommissioning trust 3 Current assets: Cash and temporary investments 148,002 Accounts receivable 15,469,619 Materials and supplies, at average cost 954,274 Prepayments and other 184,639 16,756,534 , Deferred federal and state taxes 14,124,186 A Total Assets $125,644,563 l mammmmmmmmam ! 4 (_/-- t
- - . . . - ~ , , - , . _ . , - . . ~+e_,- ._.,.m , - - . . . _ , ~ . . - - , . . , . . , - - - - , . . - , , . - - . - , - , - -
Financial Statement 3.1 Page 2 of 2 YANKEE ATOMIC ELECTRIC COMPANY l Balance Sheets September 30, 1990 (Unaudited) ; CAPITALIZATION AND LIABILITIES Capitalization: __ capital-stock, par value $100 per share; 153,400. shares authorized and outstanding $15,340,000 Retained earnings 6,408,625 i Long-term debt- 20,000,000 Total capitalization 41,
.____'748,625 Currentiliabilities
-16,300,000 -!
- Short-term: debt - -
' Accounts payable and_other; liabilities 9,553,527 Accrued. federal income taxes- 464,963 .
Accrued interest- 119,004 O 26','437,494 Unamortized investment tax credits 572,917 Decommissioning reserve 56,885,527 Total Liabilities $125,644,563 1
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Financial Statement 3.2 YANKEE ATOMIC ELECTRIC COMPANY Statements of Income and Retained Earnings O _ Twelve Months Ending September 30, 1990 (Unaudited) OPERATING REVENUES $68,513,742 Electric sales 38,034,531 Engineering services to others ------_---- Total operating revenues 106,548,273 OPERATING EXPENSES 9,692,913 Fuel 24,087,841 Operations 50,044,922 Engineering 4,086,058 Maintenance 5,672,748 Decommissioning Deprecation 2,387,082 Taxes, other than federal income 3,973,352 1,696,722 Federal income taxes ---- ----- Total operating expenses 101,541,638 5,006,635 OPERATING INCOME OTHER INCOME Allowance for equity funds used - during construction O Other Referendum -_- .----- 142,088 5,255 Operating and other income 5,153,978 INTEREST 1,788,257 Interest on long-term debt 1,024,194 Interest on short-tern debt 77,758 Other interest Allowance for borrowed funds used (486,894) during construction -_--- ..- Total interest 2,403,315
$2,750,663 NET INCOME (LOSS) ===========
Retained earnings at beginning of period $6,265,762 2,750,663 Net income (loss) -- __ --- . 9,016,425 Dividends paid 2,607,800 Retained earnings at end of period $6,408,625
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PER SHARE DATA Earnings per share $17.93 O Dividends per share
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$17.00
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