File No. 70-7543
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1 TO
FORM U-1
APPLICATION/DECLARATION WITH RESPECT TO
CREDIT FACILITY SUBSTITUTION
under
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
THE CONNECTICUT LIGHT AND POWER COMPANY
SELDON STREET
BERLIN, CONNECTICUT 06037
(Name of companies filing this statement and address of principal executive
office)
NORTHEAST UTILITIES
(Name of top registered holding company parent of declarant)
Robert P. Wax, Esq.
Vice President, Secretary and General Counsel
Northeast Utilities Service Company
P.O. Box 270
Hartford, CT 06141-0270
(Name and address of agent for service)
The Commission is requested to mail signed copies of all orders, notices, and
communication to
David R. McHale Jeffrey C. Miller
Manager-Project and Short-Term Finance Assistant General
Northeast Utilities Counsel
Service Company Northeast Utilities
P.O. Box 270 Service Company
Hartford, CT 06141-0270 P.O. Box 270
Hartford, CT
06141-0270
I. Description of Proposed Transaction
1. The Connecticut Light and Power Company ("CL&P"), a public utility
subsidiary of Northeast Utilities ("NU"), hereby applies under the Public
Utility Holding Company Act of 1935 ("Act") for approval of a modification of
the order of the Securities and Exchange Commission ("Commission") dated
October 24, 1988 (Release No. 35-24734) (the "Order") in this file.
2. In the Order, the Commission approved CL&P's proposed financing of
pollution control and/or sewage or solid waste disposal facilities at the
Seabrook Station No. 1 nuclear electric generating plant (the "Facilities").
The cost of acquiring, constructing and installing the Facilities was
financed by CL&P through its use of the net proceeds from the sale by the
Industrial Development Authority of the State of New Hampshire ("IDA") of its
pollution control revenue bonds ("Bonds") in the principal amount of
$10,000,000. The Bonds were issued pursuant to an Indenture of Trust between
the IDA and Baybank Middlesex, as trustee (the "Trustee"), and the proceeds
of the issuance of the Bonds were loaned to CL&P pursuant to a Financing
Agreement (the "Loan Agreement") between CL&P and the IDA.
3. As set forth in CL&P's Application/Declaration in this file, in
order to obtain the benefits of a high quality rating for the Bonds, CL&P's
obligations under the Loan Agreement are secured by an irrevocable letter of
credit (the "Letter of Credit") in the amount of $10,833,334 issued by Union
Bank of Switzerland, New York Branch (the "Bank") in favor of the Trustee.
The Letter of Credit secures $10,000,000 of principal amount plus interest in
the amount of $833,334 at the maximum rate of 15% per annum for 200 days.
The purpose of this filing is to seek authority for CL&P (a) to participate
in an amendment to the Reimbursement and Security Agreement dated as of
October 1, 1988 between the Company and the Bank ("Agreement") in order (i)
to change the expiration date of the Letter of Credit from perpetual to a
three-year term ending November 1, 1997 extendible for successive one-year
terms thereafter indefinitely with the consent by the Company and the Bank,
and (ii) to reduce the annual Letter of Credit fee payable to the Bank and
(b) to replace the letter of credit provided by the Bank, as permitted by
Section 3.13 of the Loan Agreement, by delivery of a substitute credit
facility, consisting of a new letter of credit, and related agreements, to be
provided by a substitute bank to be chosen by CL&P ("Substitute Bank").
4. For corporate, accounting and regulatory reasons, the Bank has
approached the Company seeking to eliminate its perpetual obligation to
provide the Letter of Credit. The Company is agreeable to revising this
obligation to a three-year commitment coupled with an "evergreen" feature
whereby, at the request of the Company and with the consent of the Bank, the
Letter of Credit can be extended indefinitely for successive one-year terms.
The Company believes that were the Bank to not consent to an extension in the
future, the Company could obtain a replacement letter of credit on comparable
terms without difficultly.
5. In conjunction with the changes mentioned above, the Bank is
agreeable to revising the annual Letter of Credit fee the Company must pay,
from 0.45% of the Letter of Credit amount to the following percentages,
depending on the lower of the Company's bond ratings from time to time as
determined by Moody's and Standard and Poor's.
Applicable Per
Moody's S&P Annum LOC Fee Rate
A3 or higher A- or higher 0.35%
Baa 1 and Baa 2 BBB+ and BBB 0.40%
Baa 3 BBB- 0.55%
Baa 1 or below BB+ or below 0.70%
or no rating from or no rating from
either agency either agency
6. At the Company's present bond rating, Moody's Baa1 and S&P BBB+,
respectively, the annual LOC fee would change from 0.45% to 0.40%,
representing a reduction of $5,417 per annum.
7. If, as has happened with several other banks providing letters of
credit to CL&P, the Bank's credit rating were to deteriorate, the
marketability of the Bonds and their effective interest cost to CL&P could be
negatively impacted. In addition, the Bank itself may choose not to renew
its commitment or CL&P may, for a variety of reasons, seek alternative banks.
Accordingly, CL&P seeks authority to replace the Bank's letter of credit with
a new letter of credit ("Substitute LOC") to be issued by a new bank
("Substitute Bank"). The Substitute LOC would be issued under a new letter
of credit and reimbursement agreement ("New LOC Agreement") substantially
identical to the Letter of Credit and Reimbursement Agreement dated as of
September 1, 1993 among CL&P, Deutsche Bank AG, New York Branch, Issuing Bank
and Agent, and various co-agents and participating banks, as approved by the
Commission in File No. 70-8088.
8. Furthermore, CL&P seeks authority hereunder to obtain from time to
time new letters of credit from the same or different banks and further
extensions and modifications of and replacements for the New LOC Agreement
with such banks from time to time during the term of the Bonds supported
thereby, in accordance with the provisions of the Loan Agreement and provided
that (A) the total amount available to be drawn under any such extended,
modified, or replacement letter of credit does not exceed $10,833,334, (B)
the annual letter of credit costs applicable to any such extension,
modification, or replacement do not exceed 1.00% per annum of the total
amount available to be drawn under the extended, modified or replacement
letter of credit, (C) the New LOC Agreement applicable to any such extension,
modification or replacement shall provide (or shall afford CL&P the option to
elect) that tender advances bear interest until paid at a rate not to exceed
the higher of (1) the prime rate plus 2.00% or (2) the federal funds rate
plus 2.00%, (D) such extension, modification, or replacement is otherwise on
terms that are substantially similar in all material respects to those
applicable to the New LOC Agreement (or previous extensions or modifications
thereof or replacements therefore) proposed to be entered into in connection
with the replacement of the Bank, the form of which is incorporated herein as
Exhibit B.2, and the Pledge Agreement between CL&P and the bank to be named
(Exhibit 101.C to Exhibit B.2), and (E) CL&P shall have obtained all
necessary approvals applicable to such extension, modification or
replacement. The Commission has previously granted CL&P authority to obtain
extensions or modifications of, and replacements for, its letters of credit
and reimbursement agreements from time to time during the terms of certain of
its pollution control revenue bonds by its Supplemental Order of August 24,
1994 in File No. 70-7320.
9. Except in accordance with the Act, neither NU nor any subsidiary
thereof ("Companies") (a) has acquired an ownership interest in an exempt
wholesale generator ("EWG") or a foreign utility company ("FUCO") as defined
in Sections 32 and 33 of the Act, or (b) now is or as a consequence of the
transactions proposed herein will become a party to, or has or will as a
consequence of the transactions proposed herein have a right under, a
service, sales, or construction contract with an exempt wholesale generator
or a foreign utility company. None of the proceeds from the transactions
proposed herein will be used by the Companies to acquire any securities of,
or any interest in, an exempt wholesale generator or a foreign utility
company.
The NU system is in compliance with Rule 53(a), (b), and (c), as
demonstrated by the following determinations:
(i) NU's aggregate investment in EWGs and FUCOs (i.e., amounts
invested in or committed to be invested in EWGs and FUCOs, for which there is
recourse to NU) does not exceed 50% of the NU system's consolidated retained
earnings as reported for the four most recent quarterly periods on NU's Form
10-K and 10-Qs.
(ii) Encoe Partners (NU's only EWG or FUCO at this time) maintains
books and records, and prepares financial statements in accordance with Rule
53(a)(2). Furthermore, NU has undertaken to provide the Commission access to
such books and records and financial statements, as it may request.
(iii) No employees of the NU system's public utility companies
have rendered services to Encoe Partners.
(iv) NU has submitted (a) a copy of each Form U-1 and Rule 24
certificates that have been filed with the Commission under Rule 53 and (b) a
copy of Item 9 of Form U5S and Exhibits G and H thereof to each state
regulator having jurisdiction over the retail rates of the NU system public
utility companies.
(v) Neither NU nor any NU subsidiary has been subject of a
bankruptcy or similar proceeding unless a plan of reorganization has been
confirmed in such proceeding. In addition, NU's average consolidated
retained earnings for the four most recent quarterly periods has not
decreased by 10% or more from the average for the previous four quarterly
periods.
(vi) In the previous fiscal year, NU did not report operating
losses attributable to its investment in Encoe Partners, unless such losses
did not exceed 5 percent of NU's consolidated retained earnings.
Item 2. Fees, Commissions and Expenses
No fees, commissions or expenses have been paid or will be paid or
incurred in connection with the proposed transactions, other than (i) the
Commission's $2,000 filing fee, and (ii) expenses for legal, financial and
other services billed to CL&P at cost by NUSCO, not to exceed $5,000.
Item 4. Regulatory Approval
No federal or state regulatory authority, other than the Commission
under the Act, and the Connecticut Department of Public Utility Control
("DPUC"), has any jurisdiction over the proposed transactions.
Item 5. Procedure
It is respectfully requested that the Commission enter not later than
December 16, 1994 an appropriate order granting and permitting this Post-
Effective Amendment to become effective, and subject, if an approving order
of the DPUC has not then been issued, to the issuance of such order.
No recommended decision by a hearing officer or other responsible
officer of the Commission is necessary or required in this matter. The
Office of Public Utility Regulation within the Division of Investment
Management of the Commission may assist in the preparation of the
Commission's decision in this matter. There should be no 30 day waiting
period between the issuance and the effective date of any order issued by the
Commission in this matter, and it is respectively requested that any such
order be made effective immediately upon the entry thereof.
Item 6. Exhibits and Financial Statements
(a) Exhibits
B.1. Draft of Amendment to Reimbursement and Security Agreement
between CL&P and the Bank. (Filed herewith as Exhibit 1 to
Exhibit D.1)
B.2. Substitute LOC Agreement. (Reference is made to Exhibits B-7
and B-8 set forth in Amendment No. 1 made August 12, 1993 in
File No. 70-8088.)
D.1. Application to DPUC
D.2. DPUC Order (to be filed by amendment.)
F.1.1. Opinion of Counsel
J.1. Proposed Form of Notice under the Act.
(b) Financial Statements. Financial statements have not been included
because this transaction is not expected to have pro forma effects on the
financial statements of CL&P or the NU system consolidated.
Item 7. Information as to Environmental Effects
This Post-Effective Amendment relates to revising security arrangements
for pollution control financing and as such, it is believed that the granting
and permitting to become effective of this Post-Effective Amendment will not
constitute a major federal action significantly affecting the quality of the
human environment. No other federal agency has prepared or is preparing an
environmental impact statement with respect to the proposed transaction.
SIGNATURES
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned company has duly caused this statement to be signed
on its behalf by the undersigned thereunto duly authorized.
THE CONNECTICUT LIGHT AND POWER COMPANY
By: /s/Jeffrey C. Miller
Title: Assistant General Counsel
Dated: October 31, 1994
Exhibit D.1
October 18, 1994
Mr. Robert J. Murphy
Executive Secretary
Connecticut Department of Public Utility Control
One Central Park Plaza
New Britain, CT 06051
Re: Application of The Connecticut Light and Power Company for
Modification of Decision with Respect to Approval of Financing for
Pollution Control and/or Sewage or Solid Waste Disposal Facilities
Docket No. 88-09-01
Dear Mr. Murphy:
Enclosed herewith for filing are the original and twenty-two (22) copies
of an Application of The Connecticut Light and Power Company (the "Company")
for approval by the Connecticut Department of Public Utility Control (the
"Department") of a proposed modification of the Decision rendered by the
Department in the above-referenced docket. Pursuant to this Application, the
Company is seeking authority (i) to change the expiration date of the letter
of credit issued to support the pollution control bonds from perpetual to a
three-year term ending November 1, 1997, extendible for successive one-year
terms thereafter indefinitely with the consent of the Company and the bank,
(ii) to reduce the reimbursement fee payable to the bank and (iii) to obtain
approval for any further changes in the present letter of credit and
replacement of the present and future letters of credit during the term of
the bonds supported thereby.
Final approval of the Application by the Department is respectfully
requested by November 30, 1994. No other orders of regulatory bodies other
than the Securities and Exchange Commission under the Public Utility Holding
Company Act of 1935 are required in this matter.
Please acknowledge receipt of the enclosed Application by stamping the
enclosed copy of this letter, and returning it to me with our messenger.
Sincerely,
/s/Jeffrey C. Miller, Esq.
Assistant General Counsel
Enclosures
cc: (w/encs.) David McHale
Kelly Maitland
Jane P. Seidl
STATE OF CONNECTICUT
DEPARTMENT OF PUBLIC UTILITY CONTROL
APPLICATION OF
THE CONNECTICUT LIGHT AND POWER COMPANY
FOR MODIFICATION OF DECISION WITH
RESPECT TO APPROVAL OF FINANCING FOR
POLLUTION CONTROL AND/OR SEWAGE OR
SOLID WASTE DISPOSAL FACILITIES
DOCKET NO. 88-09-01
I. Description of Proposed Modification
1. The Connecticut Light and Power Company ("CL&P"), a public service
company within the meaning of Section 16-1 of the General Statutes of
Connecticut, Revision of 1958, as amended (the "Connecticut General
Statutes"), hereby applies to the Department of Public Utility Control (the
"Department") pursuant to Section 16-43 of the Connecticut General Statutes
for approval of a modification of the Department's decision dated October 19,
1988 (the "Decision") in Docket No. 88-09-01. "Application of The
Connecticut Light and Power Company for Approval To Finance Pollution Control
and/or Sewage or Solid Waste Disposal Facilities" (the "Application").
Pursuant to Order No. 1 of the Decision, prior approval of the Department is
required for any material modifications of the terms and conditions under
which the Bonds (as hereinafter defined) were issued and sold.
2. In the Decision, the Department approved CL&P's proposed financing
of pollution control and/or sewage or solid waste disposal facilities at the
Seabrook Station No. 1 nuclear electric generating plant (the "Facilities").
The cost of acquiring, constructing and installing the Facilities was
financed by CL&P through its use of the net proceeds from the sale by the
Industrial Development Authority of the State of New Hampshire ("IDA") of its
pollution control revenue bonds ("Bonds") in the principal amount of
$10,000,000. The Bonds were issued pursuant to an Indenture of Trust between
the IDA and Baybank Middlesex, as trustee (the "Trustee"), and the proceeds
of the issuance of the Bonds were loaned to CL&P pursuant to a Financing
Agreement (the "Loan Agreement") between CL&P and the IDA.
3. As set forth in the Application, in order to obtain the benefits of
a high quality rating for the Bonds, CL&P's obligations under the Loan
Agreement are secured by an irrevocable letter of credit (the "Letter of
Credit") in the amount of $10,833,334 issued by Union Bank of Switzerland,
New York Branch (the "Bank") in favor of the Trustee. The purpose of this
application for modification of the Decision is to seek authority for CL&P
(a) to participate in an amendment to the Reimbursement and Security
Agreement dated as of October 1, 1988 between the Company and the Bank
("Agreement") in order (i) to change the expiration date of the Letter of
Credit from perpetual to a three-year term ending November 1, 1997 extendible
for successive one-year terms thereafter indefinitely with the consent by the
Company and the Bank, and (ii) to reduce the annual Letter of Credit fee
payable to the Bank and (b) to replace the letter of credit provided by the
Bank, as permitted by Section 3.13 of the Loan Agreement, by delivery of a
substitute credit facility, consisting of a new letter of credit, and related
agreements, to be provided by a substitute bank to be chosen by CL&P
("Substitute Bank").
4. For corporate, accounting and regulatory reasons, the Bank has
approached the Company seeking to eliminate its perpetual obligation to
provide the Letter of Credit. The Company is agreeable to revising this
obligation to a three-year commitment coupled with an "evergreen" feature
whereby, at the request of the Company and with the consent of the Bank, the
Letter of Credit can be extended indefinitely for successive one-year terms.
The Company believes that were the Bank to not consent to an extension in the
future, the Company could obtain a replacement letter of credit on comparable
terms without difficultly.
5. In conjunction with the changes mentioned above, the Bank is
agreeable to revising the annual Letter of Credit fee the Company must pay,
from 0.45% of the Letter of Credit amount to the following percentages,
depending on the lower of the Company's bond ratings from time to time as
determined by Moody's and Standard and Poor's.
Applicable Per
Moody's S&P Annum LOC Fee Rate
A3 or higher A- or higher 0.35%
Baa 1 and Baa 2 BBB+ and BBB 0.40%
Baa 3 BBB- 0.55%
Baa 1 or below BB+ or below 0.70%
or no rating from or no rating from
either agency either agency
6. At the Company's present bond rating, Moody's Baa1 and S&P BBB+,
respectively, the annual LOC fee would change from 0.45% to 0.40%,
representing a reduction of $5,417 per annum.
7. If, as has happened with several other banks providing letters of
credit to CL&P, the Bank's credit rating were to deteriorate, the
marketability of the Bonds and their effective interest cost to CL&P could be
negatively impacted. In addition, the Bank itself may choose not to renew
its commitment or CL&P may, for a variety of reasons, seek alternative banks.
Accordingly, CL&P seeks authority to replace the Bank's letter of credit with
a new letter of credit ("Substitute LOC") to be issued by a new bank
("Substitute Bank"). The Substitute LOC would be issued under a new letter
of credit and reimbursement agreement ("New LOC Agreement") substantially
identical to the Letter of Credit and Reimbursement Agreement dated as of
September 1, 1993 among CL&P, Deutsche Bank AG, New York Branch, Issuing Bank
and Agent, and various co-agents and participating banks, as approved by the
Department in Docket No. 93-06-23.
8. Furthermore, CL&P seeks authority hereunder to obtain from time to
time new letters of credit from the same or different banks and further
extensions and modifications of and replacements for the New LOC Agreement
with such banks from time to time during the term of the Bonds supported
thereby, in accordance with the provisions of the Loan Agreement and provided
that (A) the total amount available to be drawn under any such extended,
modified, or replacement letter of credit does not exceed $10,833,334, (B)
the annual letter of credit costs applicable to any such extension,
modification, or replacement do not exceed 1.00% per annum of the total
amount available to be drawn under the extended, modified or replacement
letter of credit, (C) the New LOC Agreement applicable to any such extension,
modification or replacement shall provide (or shall afford CL&P the option to
elect) that tender advances bear interest until paid at a rate not to exceed
the higher of (1) the prime rate plus 2.00% or (2) the federal funds rate
plus 2.00%, (D) such extension, modification, or replacement is otherwise on
terms that are substantially similar in all material respects to those
applicable to the New LOC Agreement (or previous extensions or modifications
thereof or replacements therefore) proposed to be entered into in connection
with the replacement of the Bank, the form of which is attached hereto as
Exhibit 2, and the Pledge Agreement between CL&P and the bank to be named
(Exhibit B to Exhibit 2), and (E) CL&P shall have obtained all necessary
approvals applicable to such extension, modification or replacement. The
Department has previously granted CL&P authority to obtain extensions or
modifications of, and replacements for, its letters of credit and
reimbursement agreements from time to time during the terms of certain of its
pollution control revenue bonds by its Decision of August 10, 1994 in Docket
No. 86-11-10.
II. Additional Information
The following additional information is supplied as part of this
Application:
A. The exact legal name of the applicant and its principal place of
business:
The Connecticut Light and Power Company
107 Selden Street
Berlin, Connecticut 06037
CL&P is a corporation specially chartered by the General Assembly of the
State of Connecticut.
B. The name, title, address and telephone number of the attorney and
other person to whom correspondence or communications in regard to this
application are to be addressed:
Mr. David R. McHale
Manager - Project and Short-Term Finance
Northeast Utilities Service Company
P.O. Box 270
Hartford, Connecticut 06141-0270
Telephone: 665-5601
and
Jeffrey C. Miller
Assistant General Counsel
Northeast Utilities Service Company
P.O. Box 270
Hartford, Connecticut 06141-0270
Telephone: 665-3532
C. A concise and explicit statement of facts on which the Department is
expected to rely in granting this application:
1. The Bank has offered the Company a meaningful fee reduction if the
Company will agree to limit the Bank's obligation to furnish the Letter of
Credit to three years, with a continuing 1-year evergreen extension right if
both parties agree. Because the Bank's own credit rating remains very high,
AAA, the Company continues to enjoy a lower interest rate on the Bonds
because of the Letter of Credit and has no desire to replace the Bank at the
present time. Similar transactions entered into at this time would be
secured with letters of credit issued for a specific term, not perpetual, and
the Bank has offered a new annual fee structure which is comparable to and
competitive with fees that would be charged by competing banks today.
2. CL&P is also seeking the same kind of flexibility previously
granted in the Department's Decision dated August 10, 1994 in Docket No. 86-
11-10 to obtain new letters of credit to support long-term pollution control
financings. Since the Bank herein can choose not to extend its commitment
beyond a three-year term, CL&P needs the latitude to effect new arrangements
within the parameters stated above to seek alternatives if the Bank cannot
recommit or does so on uneconomic terms. CL&P agrees to seek competitive
choices from letter of credit providers if such a course of action is
necessary.
D. Explanation of any unusual circumstances involved in this
application:
The Department's attention is directed to the fact that the
modifications proposed hereunder must be approved by the Securities and
Exchange Commission (the "SEC") under the Public Utility Holding Company Act
of 1935 and that such approval may not be granted until the SEC has received
a certified copy of the Decision of this Department. Final approval of this
application by the Department is therefore respectfully requested on or
before November 30, 1994.
III. Exhibits
CL&P is filing herewith (or, as indicated, will file by amendment) the
exhibits listed in Appendix I hereto. This Application and Appendix I set
forth all exhibits required to be filed by CL&P and which CL&P deems
necessary or desirable to support the granting of this application. CL&P,
however, hereby reserves the right to file such additional testimony and
exhibits as it may consider to be necessary or desirable.
IV. Requests for Approval
CL&P respectfully requests the Department's approval, pursuant to
Section 16-43 of the General Statutes of Connecticut, of the transactions
described herein.
Dated this 18th day of October, 1994.
Respectfully submitted,
THE CONNECTICUT LIGHT AND POWER COMPANY
By /s/Jeffrey C. Miller
Assistant General Counsel
Northeast Utilities Service Company
Its Attorney
APPLICATION OF
THE CONNECTICUT LIGHT AND POWER COMPANY
FOR MODIFICATION OF DECISION WITH
RESPECT TO APPROVAL OF FINANCING FOR
POLLUTION CONTROL AND/OR SEWAGE OR
FACILITIES
APPENDIX I - EXHIBITS
1. Draft of Amendment to Reimbursement and Security Agreement between CL&P
and the Bank.
2. Substitute LOC Agreement. (Reference is made to Exhibits 5 and 6 set
forth in Appendix I to filing made August 6, 1993 in Docket No. 93-06-
23.)
3 Resolutions of Board of Directors of The Connecticut Light and Power
Company. (To be filed by amendment.)
4. Estimated Expenses of the Proposed Amendment. (To be filed by
amendment.)
Exhibit 1
AMENDMENT TO REIMBURSEMENT AND SECURITY AGREEMENT
AMENDMENT dated as of July , 1994 between The Connecticut Light and
Power Company (the "Company") and Union Bank of Switzerland, New York Branch
(the "Bank").
WHEREAS, the parties hereto have entered into a Reimbursement and
Security Agreement dated as of October 1, 1988 ([as heretofore amended,] the
"Agreement"); and
WHEREAS, the parties hereto wish to amend the Agreement in the manner
specified below;
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Definitions: Interpretation. Each term used herein has the
meaning set forth in the Agreement unless otherwise defined herein.
References to "hereof", "hereunder" and this "Agreement" and all similar
references contained in the Agreement shall during the effectiveness of this
Amendment refer to the Agreement as amended hereby. Except as expressly set
forth herein, this Amendment shall not amend or waive any provision of the
Agreement, and all such provisions are hereby ratified and confirmed in all
respects.
Section 2. Amendment of the Agreement. (a) Section 1(a) of this
Agreement is amended by inserting therein, immediately after the definition
of "Adjusted Capitalization", the following new definition:
"Applicable LC Fee Rate" means, at any time, the rate per annum set
forth below corresponding to the ratings then assigned by Moody's
Investors Service Inc. ("Moody's") and Standard & Poors Corporation
("S&P") to the Company's first mortgage bonds (or other senior secured
debt) not supported by letters of credit or other credit enhancement
facilities, the Applicable LC Fee Rate to change as when such ratings
change:
Moody's S&P Applicable LC Fee Rate
A3 or higher A- or higher 0.35% per annum
Baa1 and Baa2 BBB+ and BBB 0.40% per annum
Baa3 BBB- 0.55% per annum
Ba1 or below BB+ or below 0.70% per annum
For purposes of the foregoing, (i) in the event of a split rating, the
lower rating shall govern, and (ii) in the event that there is no such
rating from either Moody's or S&P, the Applicable LC Fee Rate shall be
0.70% per annum.
(b) Section 3(b) of the Agreement is hereby amended by replacing the
words "45/100 of 1% per annum" in the clause (ii) thereof with the words "the
Applicable LC Fee Rate times".
Section 3. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
all signatures thereon were upon the same instrument.
Section 4. Effectiveness. This Amendment shall become effective as of
the date hereof when each party shall have received a counterpart hereof duly
executed by the other party.
SECTION 5. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT
REGARD TO CONFLICT OF LAWS PRINCIPLES).
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first above written.
The Connecticut Light and Power
Company
By
Title:
Union Bank of Switzerland
New York Branch
By
Title:
By
Title:
, 1994
Ref: Irrevocable Letter of Credit no. 84179
Chemical Bank,
as agent for the trustee under
Indenture of Trust dated as of
October 1, 1988
Dear Sirs:
Subject to your approval hereof as requested below, this letter amends
our Irrevocable Letter of Credit No. 84179, dated October 27, 1988 and issued
in your favor.
The first full paragraph on page 4 of the referenced Letter of Credit is
hereby amended to read in full as follows:
This Letter of Credit shall expire at our close of business at our
aforesaid address on the earlier to occur of (i) the Expiration Date (or if
the same is not a Business Day, the first Business Day following the
Expiration Date) or (ii) the date on which we receive from the Trustee a
certificate in form of Annex F hereto. This Letter of Credit shall be
promptly surrendered to us by you upon such expiration. The Expiration Date
shall be July 1, 1997; provided that, unless this Letter of Credit shall have
previously expired, if the Company so requests by Irrevocable written notice
to the Bank not more than 90 nor less than 60 days prior to July 1 in any
year, the Bank may, in its sole and absolute discretion, elect to extend the
Expiration Date by an additional period of one year. Any such extension may
be effected only be a written instrument signed by the Bank and specifying
the new Expiration Date. If the Bank fails to respond to any such request of
the Company, the Bank shall be deemed conclusively to have elected not to
consent to such request.
Please signify your consent to the foregoing amendment by signing a copy
of this letter in the space provided below and returning it to us, whereupon
the referenced Letter of Credit shall be amended as set forth above,
effective as of the date of this letter.
Very truly yours,
UNION BANK OF SWITZERLAND
NEW YORK BRANCH
By
By
Accepted and agreed to:
Chemical Bank,
as agent for the trustee under the
Indenture of Trust referred to above
By
Exhibit F.1.1
File No. 70-7543
October 28, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: File No. 70-7543
Application/Declaration by the Connecticut Light and Power Company with
Respect to Credit Facility Substitution
Ladies and Gentlemen:
I am Assistant General Counsel of Northeast Utilities Service Company
("NUSCO"), a service company subsidiary of Northeast Utilities ("NU"), and I
am furnishing this opinion in connection with Post-Effective Amendment No. 1
to the Application/Declaration, as amended, on Form U-1 (the "Declaration")
of The Connecticut Light and Power Company, a subsidiary of NU ("CL&P" or the
"Company"), to the Securities and Exchange Commission in File No. 70-7543
with respect to the amending of a letter of credit and the acquisition of a
Substitute LOC and other letter of credit facilities by the Company to secure
certain bonds issued to finance the cost of certain pollution control,
sewage, and/or solid waste disposal facilities, all as more fully set forth
in the Declaration. Capitalized terms used herein and not otherwise defined
are used as defined in the Declaration.
In connection with this opinion, I have examined the Declaration and the
exhibits thereto, and I have examined or caused to be examined such other
papers, documents, and records and have made such examination of law and have
satisfied myself as to such other matters as I have deemed relevant or
necessary for the purpose of this opinion. I have assumed the authenticity
of all documents submitted to me as originals, the genuineness of all
signatures, the legal capacity of natural persons, and the conformity to
originals of all documents submitted to me as copies.
Based upon the foregoing, and in the event the proposed transactions
contemplated by the Declaration are carried out in accordance therewith, I am
of the opinion that
(a) Upon receipt of approval from the Connecticut Department of Public
Utility Control and compliance with the conditions stated therein, all state
laws applicable to CL&P in connection with the proposed transactions will
have been complied with;
(b) CL&P is validly organized and duly existing under the laws of the
State of Connecticut;
(c) The debt securities issued by CL&P will, upon compliance with the
terms, conditions and provisions applicable to their issuance stated in the
governing agreements pertaining thereto, be valid and binding obligations of
CL&P in accordance with their terms; and
(d) The consummation of the proposed transactions will not violate the
rights of the holders of any securities issued by CL&P or any associate
thereof.
The opinions set forth herein are limited to the laws of the State of
Connecticut and the federal laws of the United States. I am a member of the
bar of the State of New York. I am not a member of the bar of the State of
Connecticut, and do not hold myself out as an expert on the laws of
Connecticut, although I have made a study of relevant laws of Connecticut.
In expressing opinions about matters governed by the laws of Connecticut, I
have consulted with counsel who are employed by NUSCO and are members of the
bar of Connecticut.
I hereby consent to the use of this opinion in connection with the
filing of the Declaration.
Very truly yours,
/s/Jeffrey C. Miller
Assistant General Counsel
Northeast Utilities Service Company
EXHIBIT J.1
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35 - )
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
, 1994
The Connecticut Light and Power Company ("CL&P"), Seldon Street, Berlin,
Connecticut 06037, an electric utility company subsidiary of Northeast
Utilities ("Northeast"), a registered holding company, has filed a post-
effective amendment to its Application/Declaration (File No. 70-7543) under
Sections 6(a) and 7 of the Act.
In 1988, pursuant to Commission order dated October 24, 1988 (HCAR No.
35-24734) the Industrial Development Authority of the State of New Hampshire
issued $10 million in principle amount of a series of pollution control
revenue bonds ("Bonds") for financing CL&P's share of the cost of
constructing certain pollution control, sewage, and solid waste disposal
facilities at the Seabrook Nuclear Electric Generating Station. Unit No. 1.
In order to improve the credit ratings of, and to support, the Bonds,
CL&P obtained a letter of credit from Union Bank of Switzerland ("UBS").
CL&P now seeks authority to change the expiration date of the UBS letter of
credit from perpetual to a three-year term renewable on an evergreen basis
from year to year thereafter with the consent of the parties; to reduce the
annual letter of credit fee to UBS; and to obtain new letters of credit from
new banks should it become necessary. The new letters of credit would not
exceed $10,833,334 in amount, representing prinicpal in the amount of
$10,000,000 and interest in the amount of $833,334 at the maximum rate of 15%
per annum for 200 days and would be issued pursuant to new letters of credit
and reimbursement agreements and related documents between a bank and CL&P.
Tender advances under such arrangements would bear interest at a rate not to
exceed the higher of (i) the prime rate plus 2.00%, or (ii) the federal funds
rate plus 2.00%. Annual letter of credit costs under the substitute facility
will not exceed 1.00% per annum.
CL&P also seeks authority to obtain further extensions and modifications
of replacements for the letter of credit and reimbursement agreement from
time to time during the term of the bonds supported thereby.
For the Commission, by the Division of Investment Management, pursuant
to delegated authority.
Jonathan G. Katz
Secretary
