SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM U5S
ANNUAL REPORT
For the Year ended December 31, 1994
Filed pursuant to the Public Utility Holding Company Act of 1935 by
Eastern Utilities Associates, P.O. Box 2333, Boston, Massachusetts 02107
04-1271872
(I.R.S. Employer Identification No.)
FORM U5S-ANNUAL REPORT
For the Calendar Year 1994
ITEMS
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1994
<TABLE>
<CAPTION>
% of
Name of Company Number of Common Voting Issuer Owner's
(add_abbreviation_used_herein) __Shares_Owned__ _Power Book_Value Book_Value
<S> <C> <C> <C> <C>
Eastern Utilities Associates Publicly Owned <F5> $365,443,051 $
(EUA or the Association)
EUA Service Corporation 1,000 100% <F6> 4,836,717 4,836,717
(EUA Service)
Blackstone Valley Electric 184,062 100% <F6> 35,243,272 35,243,272
Company (Blackstone)
Newport Electric Corporation 1,000,000 100% <F6> 21,741,695 21,741,695
(Newport)
Eastern Edison Company 2,891,357 100% <F6> 225,063,845 225,063,845
(Eastern Edison)
Montaup Electric Company 686,000 100% <F7> 193,177,995 193,177,995
(Montaup)
Preferred Stock <F7> 1,500,000 1,500,000
Debenture Bonds (Unsecured) <F7> 135,575,000 135,575,000
Pollution Control
Bonds (Unsecured) - Net <F7> 36,324,112 36,324,112
EUA Cogenex Corporation 1,000 100% <F6> 48,230,003 48,230,003
(EUA Cogenex)
Northeast Energy Management, Inc. <F1> 100% <F9> 12,852,920 12,852,920
(NEM)
EUA Cogenex-Canada <F2> 100% <F9> 100 100
(Cogenex Canada)
EUA Onsite 50% <F10> 1,384,317 1,384,317
Promissory Note 18,487,707 18,487,707
EUA Energy Capital and
Services I 50% <F10> 2,435,393 2,435,393
Promissory Note 5,830,892 5,830,892
EUA Energy Capital and
Services II 50% <F10> 4,099,954 4,099,954
Promissory Note 12,621,956 12,621,956
EUA ICC Partners 40% <F10> (294,846) (294,846)
Promissory Note 279,311 279,311
EUA Highland Energy Partners 50% <F10> 343,694 343,694
Promissory Note 1,691,339 1,691,339
EUA FRC II Energy Partners 50% <F11> (593,355) (593,355)
Promissory Note 16,422,537 16,422,537
Micro Utility Partners of America 50% <F11> (1,891,636) (1,891,636)
Promissory Note 4,702,121 4,702,121
EUA Energy Investment Corporation 100 100% <F6> (5,004,026) (5,004,026)
(EUA Energy)
Eastern Unicord Corporation 1,000 100% <F8> (1,840,296) (1,840,296)
(Unicord)
EUA Transcapacity, Inc. <F3> 1,000 100% <F8> 1,321,249 1,321,249
TransCapacity, L.P. <F4> 80% <F11> 1,124,744 1,124,744
EUA Ocean State Corporation 1 100% <F6> 18,153,668 18,153,668
(EUA Ocean State)
Ocean State Power I 29.9% 29.9%<F10><F12>31,609,926 31,609,926
Ocean State Power II 29.9% 29.9%<F10><F12>24,921,880 24,921,880
*Eastern Edison Electric Company 100% <F2> 1,000 1,000
<FN>
_________
<F1> Organized under the Laws of the Commonwealth of Massachusetts on January 7, 1994
to engage in the business of energy conservation. Acquired by EUA Cogenex on
January 14, 1994.
<F2> Organized under the Laws of Canada on October 11, 1994 to carry on EUA Cogenex's
business activities in Canada.
<F3> Organized under the Laws of the Commonwealth of Massachusetts on January 31, 1994
to engage in the development, ownership and commercialization of a computer
hardware and software system for the collection compilation and distribution of a
data base composed of natural gas pipeline capacity and capacity rights.
<F4> Agreement of Limited Partnership amended and restated to include EUA
Transcapacity, Inc. on February 3, 1994.
<F5> Cumulative Voting.
<F6> Wholly-owned by EUA.
<F7> Wholly-owned by Eastern Edison.
<F8> Wholly-owned by EUA Energy.
<F9> Wholly-owned by EUA Cogenex
<F10>General Partnership
<F11>Limited Partnership
<F12>Capital Contribution
*Inactive
</FN>
</TABLE>
ITEM 2. ACQUISITIONS OR SALES OF UTILITY ASSETS
<TABLE>
<CAPTION>
Brief Description
Name of Company of Transaction Consideration Exemptions
______(1)______ _______(2)_______ _____(3)_____ ____(4)___
<S> <C> <C> <C>
Blackstone Valley Electric Sale of Land $ 2,500,00 44 (b)
Pond Street
Woonsocket. RI
Eastern Edison Company Sale of Land $46,000.00 44 (b)
Corner
Dwelling and Fenner Streets
Fall River, MA
Eastern Edison Company Sale of Land $54,000.00 44 (b)
Hill Street
Fall River, MA
Eastern Edison Company Sale of Land $48,100.00 44 (b)
Jefferson Street
Fall River,MA
</TABLE>
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES
Type of Maximum Amount
Name of Issuer Security Outstanding During 1993 Exemption
______(1)______ __(2)__ _________(3)___________ ___(4)___
None
The following refers to short-term borrowing by EUA system companies
during 1994:
Balance at Highest Date of Effective
year-end Balance Highest Average
(000) During year Balance Interest Rate
__________ (000)______ For year____
$31,623 $49,565 2/15/94 4.78%
EUA Cogenex is required under certain contracts with various government
entities and utility companies to maintain either a letter of credit or
performance bond to collateralized performance under the contract. These
contingent liabilities will only be drawn by the customer if EUA Cogenex fails
to perform under the construction contract. The highest amount outstanding
during 1994 and the year end balance was approximately $6.9 million and $6.9
million, respectively for the letters of credit and $7.3 million and $6.7
million, respectively for the performance bonds.
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES
<TABLE>
<CAPTION>
Name of Company
Acquiring,
Name of Issuer Redeeming Number of Shares or
and or Retiring Principal Amount
Title of Issue Securities Acquired, Redeemed, Consideration Authorization
______(1)______ ______(2)_____ __or_Retired_(3)___ _____(4)_____ _____(5)_____
<S> <C> <C> <C> <C>
Newport: Newport
Preferred Stock,
$100 par value:
9.75% issue 1,000 shs. $ 100,000 <F1>
First Mortgage Bonds:
4.75% due 1994 $1,000,000 $1,000,000 <F1>
8.95% due 2001 $ 650,000 $ 650,680 <F1>
Second Mortgage Bonds:
8.50% Due 1998 $1,880,000 $1,917,600 <F1><F2>
12.00% Due 2011 $6,045,000 $6,135,675 <F1><F2>
Small Business
Administration Loan:
6.5% due 2005 $ 81,702 $ 81,702 <F1>
EUA Service: EUA Service
Secured Notes:
10.20% due 2008 $1,100,000 $1,100,000 <F1>
EUA Ocean State: EUA Ocean State
Unsecured Notes:
9.59% due 2011 $2,476,660 $2,476,660 <F1>
<FN>
(a) Rule 42
(b) For authorization see Release Nos. 35-25967 and 35-25970 dated December 29, 1993 and
January 4, 1994, respectively.
</FN>
</TABLE>
ITEM 5. INVESTMENTS IN SECURITIES OF NONSYSTEM COMPANIES
<TABLE>
(1)
<CAPTION>
% of Number of Shares
Voting or Principal Book
Name of Owner Name of Issuer Security Owned Power Amount Owned Value
____(1)______ ______(2)_____ ______(3)_____ __(4)_ ______(5)_______ _(6)_
<S> <C> <C> <C> <C> <C>
Eastern Edison Aggregate number of $ 50,405
investments-six (6)
Montaup Electric Yankee Atomic Capital Stock 4.5 6,903 shares 1,169,646
Electric Co. <F1>
" " Conn. Yankee Capital Stock 4.5 15,750 shares 4,566,961
Atomic Power Co. <F1>
" " Vermont Yankee Capital Stock 2.5 9,801 shares 1,361,608
Nuclear
Power Corp. <F1>
" " Maine Yankee Capital Stock 4.0 20,000 shares 2,721,329
Atomic
Power Co. <F1>
" " NH Hydro Trans. Capital Stock 3.3 130,812 shares 2,281,635
Electric Co. <F2>
" " NH Hydro Capital Stock 3.3 752,169 shares 1,387,102
Trans. Corp. <F2>
<FN>
___________
<F1> Regional nuclear generating company.
<F2> Owner of Transmission Facilities.
</FN>
</TABLE>
<TABLE>
Item 6. Officers and Directors
Part I. As of December 31, 1994. ________________ Names_of_System_Companies_with_which_Connected________
<CAPTION>
Blackstone
Eastern EUA Valley Newport Eastern
Utilities Service Electric Electric Edison
Associates Corporation Company___ Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Elizabeth J. Alden P.O. Box 510 D
Brockton, MA 02403
Henry J. Blais III 150 Main Street D
Pawtucket, RI 02862
Russell A. Boss One Albion Road TR
Lincoln, RI 02865
J. Thomas Brett 275 Slater St.,Ste 1700
Ottawa, Ont. Canada K1P 5H9
Richard M. Burns One Liberty Square Comp, AS, AT D, Comp, AT, VP, AT, AS VP, AT VP, AT, AC
Boston, MA 02109 AS, AC, VP
John D. Carney 110 Mulberry Street D, VP D, P
Brockton, MA 02403
Paul J. Choquette, Jr. 7 Jackson Walkway TR
Providence, RI 02940
Peter S. Damon P. O. Box 450 TR D
Middletown, RI 02842
James L. Day 7931 Rae Boulevard
Victor, NY 14564
Richard P. Eannarino 20 Thurber Blvd
Smithfield, RI 02917
John F.G. Eichorn, Jr. 1531 Georgina Avenue TR
Santa Monica, CA 90402
Joseph F. Fitzpatrick Boott Mills South D, VP
100 Foot of John Street
Lowell, MA 01852
Peter B. Freeman 100 Alumni Drive TR D
Providence, RI 02906
Robert W. Giggey 5 Tallwood Road D
Barrington, RI 02806
David H. Gulvin Washington Highway D, VP D, P D, P
Lincoln, RI 02865
Barbara A. Hassan 110 Mulberry Street VP
Brockton, MA 02403
Arthur A. Hatch One Liberty Square EVP D, EVP D, EVP D, EVP D, EVP
Boston, MA 02109
Robert J. Healey 47 Catherine Street D
Newport, RI 02840
Clifford J. Hebert, Jr. One Liberty Square T T T T T
Boston, MA 02109
Michael J. Hirsh Washington Highway VP
Lincoln, RI 02865
</TABLE>
<TABLE>
Item 6. Officers and Directors - Continued ___________Names_of_System_Companies_with_which_Connected________
Part I. As of December 31, 1994.
<CAPTION> Blackstone
Eastern EUA Valley Newport Eastern
Utilities Service Electric Electric Edison
Associates Corporation _Company__ Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Ann L. Hogan 65 Carter Avenue D
Pawtucket, RI 02861
Robert W. Lavoie 110 Mulberry Street VP
Brockton, MA 02403
Arthur P. Lennon 704 Executive Blvd.
Valley Cottage, NY 10989
Larry A. Liebenow 941 Grinnell Street
Fall River, MA 02721
Edward T. Liston Boott Mills South
100 Foot of John Street
Lowell, MA 01852
Wesley W. Marple 413 Hayden Hall TR
Northeastern University
Boston, MA 02115
Herbert L. Miller 35 Follett Street D
Cumberland, RI 02864
William F. O'Connor One Liberty Square S D, VP, S, C S S C
Boston, MA 02109
Basil G. Pallone Booth Mills South
100 Foot of John Street
Lowell, MA 01852
Donald G. Pardus One Liberty Square TR, CH, CEO D, CH D, CH D, CH D, CH
Boston, MA 02109
Paul R. Pinkham P.O. Box 543 VP
W. Bridgewater, MA 02379
Robert G. Powderly P.O. Box 543 EVP D, EVP D, EVP D, EVP D, EVP
W. Bridgewater, MA 02379
Donald H. Ramsbottom University of Mass. D
Dartmouth Foundation
Old Westport Road
No. Dartmouth, MA 02747
Larry D. Settle P.O. Box 4128 VP, AT
Middletown, RI 02840
Margaret M. Stapleton P. O. Box 111 TR
Boston, MA 02117
John R. Stevens One Liberty Square TR, COO, P D, P D, VCH D, VCH D, VCH
Boston, MA 02109
W. Nicholas Thorndike 150 Dudley Street TR
Brookline, MA 02146
Mark S. White Boott Mills South
100 Foot of John Street
Lowell, MA 01852
</TABLE>
<TABLE>
Item 6. Officers and Directors - Continued
Part I. As of December 31, 1994. ______Names_of_System_Companies_with_which_Connected____
<CAPTION>
Montaup EUA EUA Energy EUA
Electric Cogenex Investment Ocean State
Company_ Corporation Corporation Corporation
<S> <C> <C> <C> <C>
Elizabeth J. Alden P.O. Box 510
Brockton, MA 02403
Henry J. Blais III 150 Main Street,
Pawtucket, RI 02862
Russell A. Boss One Albion Road
Lincoln, RI 02865
J. Thomas Brett 275 Slater St., Ste 1700
Ottawa, Ont. Canada K1P 5H9
Richard M. Burns One Liberty Square, D, VP, D, Comp, AT D, VP, AT, AC AT
Boston, MA 02109 AT, AC
John D. Carney 110 Mulberry Street D, VP
Brockton, MA 02403
Paul J. Choquette, Jr. 7 Jackson Walkway
Providence, RI 02940
Peter S. Damon P. O. Box 450
Middletown, RI 02842
James L. Day 7931 Rae Boulevard
Victor, NY 14564
Richard P. Eannarino 20 Thurber Blvd VP
Smithfield, RI 02917
John F.G. Eichorn, Jr. 1531 Georgina Avenue
Santa Monica, CA 90402
Joseph F. Fitzpatrick Boott Mills South D, P
100 Foot of John Street
Lowell, MA 01852
Peter B. Freeman 100 Alumni Drive
Providence, RI 02960
Robert W. Giggey 5 Tallwood Rd
Barrington, RI 02806
David H. Gulvin Washington Highway D, VP
Lincoln, RI 02865
Barbara A. Hassan 110 Mulberry Street
Brockton, MA 02403
Arthur A. Hatch One Liberty Square D, EVP D, EVP D, EVP D, EVP
Boston, MA 02109
Robert J. Healey 47 Catherine Street
Newport, RI 02840
Clifford J. Hebert, Jr. One Liberty Square T T, AC T T
Boston, MA 02109
Michael J. Hirsh Washington Highway
Lincoln, RI 02865
</TABLE>
<TABLE>
Item 6. Officers and Directors - Continued
Part I. As of December 31, 1994. ________Names_of_System_Companies_with_which_Connected__
<CAPTION>
Montaup EUA EUA Energy EUA
Electric Cogenex Investment Ocean State
Company_ Corporation Corporation Corporation
<S> <C> <C> <C> <C> <C>
Ann L. Hogan 65 Carter Avenue
Pawtucket, RI 02861
Robert W. Lavoie 110 Mulberry Street
Brockton, MA 02403
Arthur P. Lennon 704 Executive Blvd. VP
Valley Cottage, NY 10989
Larry A. Liebenow 941 Grinnell Street
Fall River, MA 02721
Edward Liston Boott Mills South EVP
100 Foot of John Street
Lowell, MA 01852
Wesley W. Marple 413 Hayden Hall DIR
Northeastern University
Boston, MA 02115
Herbert L. Miller 35 Follett Street
Cumberland, RI 02864
William F. O'Connor One Liberty Square D, C D, C D, C S
Boston, MA 02109
Basil G. Pallone Boott Mills South VP
100 Foot of John Street
Lowell, MA 01852
Donald G. Pardus One Liberty Square D, CH D, CH D, CH D, CH
Boston, MA 02109
Paul R. Pinkham P. O. Box 543
W. Bridgewater, MA 02379
Robert G. Powderly P.O. Box 543 D, EVP D, EVP D, EVP D, EVP
W. Bridgewater, MA 02379
Donald H. Ramsbottom University of Mass.
Dartmouth Foundation
Old Westport Road
No. Dartmouth, MA 02747
Larry D. Settle P.O. Box 4128
Middletown, RI 02840
Margaret M. Stapleton P. O. Box 111 D
Boston, MA 02117
John R. Stevens One Liberty Square D, P D, VCH D, P D, P
Boston, MA 02109
W. Nicholas Thorndike 150 Dudley Street D
Brookline, MA 02146
Mark S. White Boott Mills South VP, AC, A Comp
100 Foot of John Street
Lowell, MA 01852
</TABLE>
<TABLE>
Item 6. Officers and Directors
Part I. As of December 31, 1994. Names_of_System_Companies_with_which_Connected_
<CAPTION>
EUA EUA Northeast
Cogenex TransCapacity Energy
Canada, Inc. Inc._________ Management Inc.
<S> <C> <C> <C> <C>
Elizabeth J. Alden P.O. Box 510
Brockton, MA 02403
Henry J. Blais III 150 Main Street
Pawtucket, RI 02862
Russell A. Boss One Albion Road
Lincoln, RI 02865
J. Thomas Brett 275 Slater St. Ste 1700 D
Ottawa, Ont. Canada K1P5H9
Richard M. Burns One Liberty Square VP, Comp D, AT VP,Comp
Boston, MA 02109
John D. Carney 110 Mulberry Street
Brockton, MA 02403
Paul J. Choquette, Jr. 7 Jackson Walkway
Providence, RI 02940
Peter S. Damon P. O. Box 450
Middletown, RI 02842
James L. Day 7931 Rae Boulevard
Victor, NY 14564
Richard P. Eannarino 20 Thurber Blvd
Smithfield, RI 02917
John F.G. Eichorn, Jr. 1531 Georgina Avenue
Santa Monica, CA 90402
Joseph F. Fitzpatrick Boott Mills South D, P D, P
100 Foot of John Street
Lowell, MA 01852
Peter B. Freeman 100 Alumni Drive
Providence, RI 02906
Robert W. Giggey 5 Tallwood Rd
Barrington, RI 02806
David H. Gulvin Washington Highway
Lincoln, RI 02865
Barbara A. Hassan 110 Mulberry Street
Brockton, MA 02403
Arthur A. Hatch One Liberty Square D, EVP
Boston, MA 02109
Robert J. Healey 47 Catherine St.
Newport, RI 02840
Clifford J. Hebert, Jr. One Liberty Square T, AS T T
Boston, MA 02109
Michael J. Hirsh Washington Highway
Lincoln, RI 02865
</TABLE>
<TABLE>
Item 6. Officers and Directors - Continued
Part I. As of December 31, 1994 Names_of_System_Companies_with_which_Connected_
<CAPTION>
EUA EUA Northeast
Cogenex TransCapacity Energy
Canada, Inc. Inc._________ Management Inc.
<S> <C> <C> <C> <C>
Ann L. Hogan 65 Carter Avenue
Pawtucket, RI 02861
Robert W. Lavoie 110 Mulberry Street
Brockton, MA 02403
Arthur P. Lennon 704 Executive Blvd. VP
Valley Cottage, NY 10989
Larry A. Liebenow 941 Grinnell Street TR
Fall River, MA 02721
Edward T. Liston Boott Mills South EVP
100 Foot of John Street
Lowell, MA 01852
Wesley W. Marple 413 Hayden Hall
Northeastern University
Boston, MA 02115
Herbert L. Miller 35 Follett Street
Cumberland, RI 02864
William F. O'Connor One Liberty Square S C C
Boston, MA 02109
Basil G. Pallone Booth Mills South VP VP
100 Foot of John Street
Lowell, MA 01852
Donald G. Pardus One Liberty Square CH D, CH D, CH
Boston, MA 02109
Paul R. Pinkham P.O. Box 543
W. Bridgewater, MA 02379
Robert G. Powderly P.O. Box 543 D, EVP
W. Bridgewater, MA 02379
Donald H. Ramsbottom University of Mass.
Dartmouth Foundation
Old Westport Road
No. Dartmouth, MA 02747
Larry D. Settle P.O. Box 4128
Middletown, RI 02840
Margaret M. Stapleton P. O. Box 111
Boston, MA 02117
John R. Stevens One Liberty Square VCH D, P D, VCH
Boston, MA 02109
W. Nicholas Thorndike 150 Dudley Street
Brookline, MA 02146
Mark S. White Boott Mills South AT
100 Foot of John Street
Lowell, MA 01852
</TABLE>
Item 6. OFFICERS AND DIRECTORS - Continued
<TABLE>
PART I. As of December 31, 1994.
<CAPTION>
KEY
<S> <C> <C> <C>
CH - Chairman of the Board T - Treasurer C - Clerk
VCH - Vice Chairman of the Board TR - Trustee AC - Assistant Clerk
P - President Comp - Comptroller D - Director
EVP - Executive Vice President AT - Assistant Treasurer CEO - Chief Executive Officer
SVP - Senior Vice President S - Secretary COO - Chief Operating Officer
VP - Vice President AS - Assistant Secretary
</TABLE>
<TABLE>
Item 6. Officers and Directors (continued)
Part II. As of December 31, 1994.
<CAPTION>
Position Held
Name of Name and Location of in Financial Applicable
Officer or Director Financial Institution Institution Exemption Rule
________(1)________ _________(2)_________ _____(3)____ _____(4)______
<S> <C> <C> <C>
Russell A. Boss Fleet National Bank Trustee Rule 70(a)
Providence, RI
Fleet Bank of Massachusetts Trustee Rule 70(a)
Boston, MA
Fleet Bank, N.A. Conn. Trustee Rule 70(a)
Hartford, CT
Paul J. Choquette, Jr. Fleet Financial Group Director Rule 70(a)
Providence, RI
Peter S. Damon Bank of Newport Trustee Rule 70(a)
_____________________
(Note: In the answer to this part II of Item 6, the phrase "financial connection
within the provisions of Section 17(c) of the Act" is regarded as being limited
by the definitions in Paragraph (h) of Rule 70 under the Act as in effect at
December 31, 1994.)
</TABLE>
Part III.
(A)Information is set out below as to cash compensation paid by the Association
and its subsidiaries for the years 1994, 1993 and 1992 to each of the five
highest paid executive officers of each Company whose aggregate cash
compensation for the year exceeded $100,000.
<TABLE>
Item 6. Part III - Officers and Directors (continued)
<CAPTION>
Long-Term All
Compensation Other
Name and Annual Compensation Restricted Compen-
Principal Fiscal Incentive Stock sation
Position____ Year Salary __Bonus__ Other<F1> Awards<F2> <F3>
<S> <C> <C> <C> <C> <C>
EUA Service Corporation
Donald G. Pardus 1994 $390,025 $100,000 $13,083 $ - $9,750
Chairman 1993 375,025 137,500 8,444 - 8,438
1992 350,025 100,000 7,795 210,000 7,000
John R. Stevens 1994 300,025 80,000 13,475 - 7,500
President 1993 275,025 107,500 12,071 - 6,188
1992 253,025 90,000 10,441 165,000 5,060
Arthur A. Hatch 1994 213,025 50,872 12,194 - 5,325
Executive Vice 1993 198,025 56,677 9,132 - 4,455
President 1992 186,025 35,433 6,157 82,376 3,720
Robert G. Powderly 1994 156,025 40,999 8,350 - 3,900
Executive Vice 1993 143,025 44,559 8,710 - 3,218
President 1992 122,825 24,194 9,241 66,606 2,456
Richard M. Burns 1994 130,025 22,005 - - 3,245
Comptroller 1993 125,025 25,621 - - 2,188
1992 117,125 35,000<F4> - 34,373 1,186
Eastern Edison Company
John D. Carney 1994 $140,025 $34,207 $4,229 $ - $3,500
President 1993 134,025 38,867 6,618 - 3,015
1992 126,025 24,003 3,443 60,616 2,520
Barbara A. Hassan 1994 111,025 20,484 - - 2,775
Vice President 1993 101,025 23,343 - - 2,272
1992 91,025 11,557 - - 1,668
Robert W. Lavoie 1994 105,392 18,645 - - 2,634
Vice President 1993 100,758 21,352 - - 2,269
1992 94,925 12,179 - - 1,898
Blackstone Valley Electric Company
David H. Gulvin 1994 $134,625 $ 33,925 $3,053 $ - $3,645
President 1993 126,625 37,497 2,978 - 2,848
1992 112,775 21,831 1,364 51,569 2,255
Michael J. Hirsh 1994 103,575 19,122 - - 2,589
Vice President 1993 98,275 21,146 - - 2,218
1992 92,725 12,116 - - 1,854
</TABLE>
Item 6. Part III - Officers and Directors (continued)
<TABLE>
<CAPTION> Long-Term All
Compensation Other
Name and Annual Compensation Restricted Compen-
Principal Fiscal Incentive Stock sation
Position Year Salary __Bonus__ Other<F1> Awards<F2> <F3>
<S> <C> <C> <C> <C> <C> <C>
Newport Electric Corporation
Larry D. Settle 1994 $108,275 $19,122 $21,145 - $2,706
Vice President 1993 105,000 12,941 - - 3,221
1992 100,938 12,941 - - 2,018
EUA Cogenex Corporation
Joseph S. Fitzpatrick 1994 $152,212 - $4,393 - $3,723
President 1993 136,993 58,097 3,917 - 3,834
1992 120,225 45,075 3,765 $27,302<F5> 2,404
Richard P. Eannarino 1994 156,515 - 941 - 3,750
Vice President 1993 150,045 - - - 1,543
1992 - - - - -
Edward J. Liston 1994 131,920 - 3,464 - 3,721
Vice President 1993 120,525 40,588 2,372 - 3,376
1992 105,525 31,650 2,640 24,144<F5> 2,109
Arthur P. Lennon 1994 121,300 - 1,523 - 3,024
Vice President 1993 119,400 40,588 1,552 - 3,457
1992 103,825 31,140 1,556 23,105<F5> 2,076
Basil G. Pallone 1994 102,525 - 2,783 - 2,562
Vice President
<FN>
___________________
<F1> Represents amounts reimbursed for tax liability accruing as a result
of personal use of company-owned automobiles.
<F2> Aggregate amount and value (including the value reflected in the
table under "Restricted Stock Awards") of shares held under
Association's Restricted Stock Plan to the officers listed above are
as follows: Mr. Pardus, 10,307 shares, $210,000; Mr. Stevens, 8,098
shares, $165,000; Mr. Hatch, 4,083 shares, $82,376; Mr. Powderly,
3,919 shares, $87,120; Mr. Burns, 1,687 shares, $34,373; Mr. Carney,
2,975 shares, $67,309; and, Mr. Gulvin, 2,351 shares, $57,264.
<F3> Contributions made under the Association's Employees' Savings Plan.
<F4> Includes a bonus received by Mr. Burns in addition to his 1992
Incentive Plan Bonus for extraordinary effort during the year.
<F5> Aggregate amount and value (including the value reflected in the
table under "Restricted Stock Awards") of shares granted under
Restricted Stock Plans to the officers listed above is as follows:
Mr. Fitzpatrick, 2,290 shares, $57,285; Mr. Liston, 1,185 shares,
$24,144; Mr. Lennon, 1,134 shares, $23,105.
</FN>
</TABLE>
(B) Securities Interest
<TABLE>
Common Shares of the Association
Beneficially_Owned_at_January_6,_1995<F1>
<CAPTION>
Executive
Employees Stock
Savings Grant
<F2> __Plan___ __Plan___ Total
<S> <C> <C> <C> <C> <C>
Henry J. Blais, III 89 1,275 - - 1,364
Russell A. Boss 1,000 - - - 1,000<F3>
Richard M. Burns 55 - 221 1,687 1,963
John D. Carney 1,137 - 837 2,975 4,949
Paul J. Choquette 805 - - - 805
Peter S. Damon - 650 - - 650
John F. G. Eichorn, Jr. 4,773 - - - 4,773
Joseph S. Fitzpatrick 1,583 - 746 447 2,776
Peter B. Freeman 2,344 - - - 2,344
David H. Gulvin 1,385 1,044 801 2,531 5,761
Arthur A. Hatch 1,257 261 2,139 4,083 7,740
Wesley W. Marple 1,885 - - - 1,885<F4>
William F. O'Connor 100 - 2,914 - 3,014
Donald G. Pardus 1,515 7,671 4,065 10,307 23,558
Robert G. Powderly 634 142 1,241 3,919 5,936
Margaret M. Stapleton 1,238 - - - 1,238
John R. Stevens - 3,938 1,336 8,098 13,372
W. Nicholas Thorndike 2,042 - - - 2,042
Directors and Officers
as a Group 46,237 34,961 25,543 37,829 144,570
</TABLE>
[FN]
<F1> Unless otherwise indicated, beneficial ownership is based on sole
investment and voting power. Each individual's ownership represents
less than two-tenths of one percent of the outstanding common shares
of the Association.
<F2> Jointly owned with spouse.
<F3> In addition, Mr. Boss owns 5 shares of Blackstone Valley Electric
Company's 4.25% Preferred Stock.
<F4> In addition, Mr. Marple's spouse owns 197 EUA common shares. Mr.
Marple disclaims any beneficial interest in such shares.
<F5> Represents less than one percent of the outstanding common shares of
the Association.
(C) Contracts and Transactions with System Companies
See Section (E) below regarding severance agreements.
(D) Indebtedness to System Companies
None
(E) The Employees' Retirement Plan of Eastern Utilities Associates and its
Subsidiary Companies (the Plan) is a tax-qualified defined benefit plan
available to eligible employees who have completed one year of service and
have attained the age of twenty-one. The officers named in the remuneration
table above participate in the Plan. Trustees and Directors who are not also
employees of EUA and its Subsidiaries (EUA System) are not covered by the
Plan. The benefits of participants become fully vested after five years of
service. Annual lifetime benefits are determined under formulas applicable to
all employees regardless of position and the amounts depend on length of
credited service and salaries prior to retirement. Benefits are equal to one
and six tenths percent of salaries (averaged over the four years preceding
retirement) for each year of credited service up to thirty-five, reduced for
each such year by one and two tenths percent of the participant's estimated age
sixty-five Social Security benefit, plus seventy-five hundredths percent of
salaries for each year of credited service in excess of thirty-five years up to
the Plan maximum of forty years.
Any contributions to provide benefits under the Plan are made by the EUA
System in amounts determined by the Plan's actuaries to meet the funding
standards established by the Employee Retirement Income Security Act of 1974,
as amended. Any contributions are actuarially determined and cannot
appropriately be allocated to individual participants. The annual benefits
shown in the tables below are straight life annuity amounts, without reduction
for primary Social Security benefits as described above. Federal law limits
the annual benefits payable from qualified pension plans in the form of a life
annuity, after reduction for Social Security benefits, to $118,800 plus
adjustments for increases in the cost of living. The number of years of
service credited at present under the Plan to Messrs. Burns, Carney,
Fitzpatrick, Gulvin, Ms. Hassan, Hatch, Hirsh, Lavoie, Lennon, Liston, Pardus,
Powderly, Settle, Stevens and White are 19, 28, 8, 35, 24, 40, 17, 33, 8, 8,
32, 15, 29, 29 and 9, respectively.
Average Annual ____________________Years_of_Service________________________
_____Salary____ ____15________20________25________30________35_________40___
$100,000 $ 24,000 $ 32,000 $ 40,000 $ 48,000 $ 56,000 $ 59,750
200,000 48,000 64,000 80,000 96,000 112,000 119,500
300,000 72,000 96,000 120,000 144,000 168,000 179,250
400,000 96,000 128,000 160,000 192,000 224,000 239,000
500,000 120,000 160,000 200,000 240,000 280,000 298,750
600,000 144,000 192,000 240,000 288,000 336,000 358,500
The Association has a non-qualified supplemental retirement plan for
certain officers of the Association and its Subsidiaries. The plan provides
for the annual payment of supplemental retirement benefits equal to 25% of the
officer's base salary when he retires, for a period of fifteen (15) years
following the date of retirement. In addition, in the event of the death of
the participant prior to retirement an amount equal to 200% of the officer's
base salary at that time will be paid to his beneficiary. The Association,
and its employer Subsidiaries through its Subsidiary, EUA Service Corporation,
maintain life insurance on the participants, to fund, in whole or in part, all
of their future liabilities under the plan, and that Corporation is the owner
and beneficiary of all such life insurance. Any amounts not covered by
insurance will be paid out of other funds available to the Association and/or
its subsidiaries. In the event of a change in control of the EUA System, a
trust fund will be established by the EUA System to ensure the performance of
its payments under the supplemental retirement plan.
The Association maintains a non-qualified, unfunded Retirement and
Savings Restoration Plan ("The Restoration Plan"). The purpose of the
Restoration Plan is to restore benefits under the qualified plans' formulas
which can not be paid from, or into, the qualified plan trusts due to federal
limitations on either earnings, contributions or benefits. Payments or
contributions which exceed the applicable federal limitations are made outside
the qualified plans in the same manner and under the same conditions as are
applicable to benefits payable from, or contributions payable to, the
qualified plans. In the event of a change in control of the Association, a
trust fund will be established by the Association to ensure the performance of
its payment obligations under the Restoration Plan.
Severance agreements with certain executive officers of the Association
and its subsidiaries, including each of the executive officers named in the
above table agreements provide that an officer's stipulated compensation,
benefits, position, responsibilities and other conditions of employment will
not be reduced during the term of the agreement, which is thirty-six months
commencing upon the date on which a Change in Control, as defined in the
agreements, of the Association occurs. If within thirty-six months after a
Change in Control the officer's employment is terminated for any reason other
than Cause, as defined, the Association will, subject to certain limitations
to comply with provisions of the Internal Revenue Code, pay the officer
within five business days a lump-sum cash amount equal to three times the
present value of such officer's annualized total compensation, continue or
vest certain fringe benefits and common share grants, and reimburse legal fees
and expenses incurred as a result of the termination or to enforce the
provisions of the severance agreement. If the officer leaves the employ of
the Association or a subsidiary following a reduction in his position,
compensation, responsibilities, authority or other benefits existing prior to
the Change in Control, or suffers a relocation of regular employment of more
than fifty miles, such departure will be deemed to be a termination for
reasons other than Cause.
(F) Rights to Indemnity
Article 32 of EUA's Declaration of Trust, as set forth in Exhibit B-1(a),
to Form U5S of EUA for the year ended December 31, 1986 is incorporated herein
by reference.
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS
<TABLE>
<CAPTION>
Accounts Charged
if any, Per Books
Name of Recipient of Disbursing
Name of Company of Beneficiary Purpose Company Amount
______(1)______ _______(2)_______ __(3)__ _______(4)_______ __(5)__
<S> <C> <C> <C> <C>
Blackstone Edison Electric Lobbying 426.4 $ 7,800
Institute Expenditures
Blackstone Tillinghast, Collins Lobbying 426.4 $ 7,035
& Graham Expenditures
Eastern Edison Edison Electric Lobbying 426.4 $15,480
Institute Expenditures
Eastern Edison No on Question 6&7 Lobbying 426.4 $ 2,500
Committee Expenditures
Eastern Edison Committee to Defend Civic 426.4 $25,000
First Amendment Rights
Newport Electric Edison Electric Lobbying 426.4 $ 3,221
Institute Expenditures
Newport Electric Tillinghast, Collins Lobbying 426.4 $ 3,000
& Graham Expenditures
</TABLE>
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS-(continue)
<TABLE>
<CAPTION>
Accounts Charged
if any, Per Books
Name of Recipient of Disbursing
Name of Company of Beneficiary Purpose Company Amount
______(1)______ _______(2)_______ __(3)__ _______(4)_______ __(5)__
<S> <C> <C> <C> <C>
Montaup Electric Various Payments Lobbying 426.4 $ 1,722
Under $1,000 Expenditures
Montaup Electric Seabrook #1 Lobbying 426.4 $ 2,700
Expenditures
</TABLE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS
Part I.
Serving Receiving Date of
Transactions Company _Company_ Contract Compensation
All applicable services are disclosed in the EUA Service Corporation's
annual filing under the 1935 Act on Form U-13-60 for the same fiscal
period as this report.
Part II.
No
Part III.
No
Company Company
Performing Receiving Scope of
_Service__ _Service_ Services Compensation
None
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES
None
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (*Filed herewith)
The following financial statements and supplemental schedules are filed as
a part of this Annual Report.
FINANCIAL STATEMENTS
1 - Consolidating Balance Sheets - December 31, 1994 of Eastern
Utilities Associates and Subsidiary Companies, Eastern Edison Company
and Subsidiary, EUA Cogenex Corporation and Subsidiaries, and
EUA Energy Investment Corporation and Subsidiaries.
2 - Consolidating Statements of Capitalization - December 31, 1994
of Eastern Utilities Associates and Subsidiary Companies, Eastern Edison
Company and Subsidiary, EUA Cogenex Corporation and Subsidiaries,
and EUA Energy Investment Corporation and Subsidiaries.
3 - Consolidating Income Statements for the year ended December 31,
1994 of Eastern Utilities Associates and Subsidiary Companies, Eastern
Edison Company and Subsidiary, EUA Cogenex Corporation and Subsidiaries,
and EUA Energy Investment Corporation and Subsidiaries.
4 - Consolidating Statements of Cash Flows for the year ended December
31, 1994 of Eastern Utilities Associates and Subsidiary Companies,
Eastern Edison Company and Subsidiary, EUA Cogenex Corporation and
Subsidiaries, and EUA Energy Investment Corporation and
Subsidiaries.
5 - Consolidating Statements of Retained Earnings and Other Paid-In
Capital for the year ended December 31, 1994 of Eastern Utilities
Associates and Subsidiary Companies, Eastern Edison Company
and Subsidiary, EUA Cogenex Corporation and Subsidiaries, and
EUA Energy Investment Corporation and Subsidiaries.
6 - Notes to Financial Statements (page 36).
Exhibits
Exhibit A - (incorporated herein by reference)
A-1 Form 10-K of EUA for 1994 (including Annual Report to Shareholders
and Proxy Statement, portions of which are incorporated therein by
reference; File No. 1-5366).
A-2 Form 10-K of Eastern Edison for 1994 (File No. 0-8480).
A-3 Form 10-K of Blackstone for 1994 (File No. 0-2602).
Exhibit B -
B-1 Declaration of Trust of EUA, dated April 2, 1928, as amended
(Exhibit A-3, File No. 70-3188; Exhibit 1 to EUA's 8-K reports for
April in each of the years 1957, 1962, 1966, 1968, 1972, and 1973,
File No. 1-5366; Exhibit A-1 (a), Amendment No. 2 to Form U-1, File
No. 70-5997, Exhibit 4-3, Registration No. 2-72589; Exhibit 1 to
Certificate of Notification, File No. 70-6713; Exhibit 1 to
Certificate of Notification, File No. 70-7084; Exhibit 3-2, Form
10-K of EUA for 1987, File No. 1-5366).
B-2 Charter of Blackstone (formerly Blackstone Valley Gas and
Electric Company), as amended (Exhibit (a)(1) and (a)(2), Form 1-A
filed March, 1957, File No. 24B-970; Exhibit A-2, Form U5S of Eastern
Utilities Associates ("EUA") for the year 1958, File No. 1-5366;
Exhibit (1), Form 8-K for March, 1965 File No. 0-2602; Exhibit A-2,
Form U5S of EUA for the year 1966, File No. 1-5366 and Exhibit (1),
Form 8-K for June 1976, File No. 0-2602; Exhibit (1), Form 10-Q for
quarter ended June 30, 1988, File No. 0-2602); Exhibit 3-3, Form
10-K of Blackstone for 1989, File No. 0-2602).
B-3 By-laws of Blackstone, (Exhibit A-2, Form U-1 filed October 16,
1990, File No. 70-7769).
B-4 Restated and Amended Articles of Organization of Eastern Edison
dated August 4, 1993.
B-5 By-laws of Eastern Edison, as amended (Exhibit 3-2, Form 10-K of
Eastern Edison for 1980, File No. 0-8480).
B-6 Charter of Montaup Electric Company ("Montaup"), as amended
(Exhibits A-6(a), A-6(b) and A-6(c) to Post Effective Amendment No.
18 to Form U-1, File No. 70-5388; Exhibit 3, Form 10-K of EUA for
1977, File No. 1-5366; and Exhibit 6 to Form U5S of EUA for 1979).
B-7 By-laws of Montaup, as amended (Exhibit 4, Form 10-K of EUA for
1977, File No. 1-5366).
B-8 Charter of EUA Service Corporation (Exhibit A-1, File No. 37-67).
B-9 By-laws of EUA Service Corporation, as amended (Exhibit 2, Form
10-K of EUA for 1977, File No. 1-5366).
B-10 Charter of EUA Cogenex Corporation, as amended (Exhibit A-1, File
No. 70-7287, Exhibit B-15 to Form U5S of EUA for 1986).
B-11 By-Laws of EUA Cogenex Corporation, as amended (Exhibit A-2, File
No. 70-7287, to Form U5S of EUA for 1986).
B-12 Agreement of Limited Partnership among Onsite Energy and EUA
Cogenex Corporation dated as of November 30, 1988 (Exhibit A-4 to
Post-Effective Amendment No. 3 of Form U-1, File No. 70-7825, dated
October 21, 1991).
B-13 EUA/FRCII Energy Associates Agreement of Limited Partnership dated
as of September 19, 1989 (Exhibit A-5 to Post-Effective Amendment
No. 3 of Form U-1, File No. 70-7825, dated October 21, 1991).
B-14 Micro Utility Partners of America, L.P., Agreement of Limited
Partnership dated as of December 20, 1988 (Exhibit A-6 to
Post-Effective Amendment No. 3 of Form U-1, File No. 70-7825, dated
October 21, 1991).
B-15 Energy Capital and Services I, LP, Agreement of Limited
Partnership dated as of April 10, 1990 (Exhibit A-7 to Post-Effective
Amendment No. 3 of Form U-1, File No. 70-7825, dated October 21, 1991).
B-16 EUA/ICC Agreement of Limited Partnership dated as of June 1, 1989
(Exhibit A-8 to Post-Effective Amendment No. 3 of Form U-1, File
No. 70-7825, dated October 21, 1991).
B-17 EUA/SYCOM General Partnership Agreement dated as of September 20,
1989 (Exhibit A-9 to Post-Effective Amendment No. 3 of Form U-1,
File No. 70-7825, dated October 21, 1991).
B-18 EUA/Highland Energy Partners, Agreement of Limited Partnership
dated as of September 27, 1990 (Exhibit A-10 to Post-Effective
Amendment No. 3 of Form U-1, File No. 70-7825, dated October 21,
1991).
B-19 Articles of Incorporation of EUA Energy Investment Corporation
(Exhibit B-14 to Form U5S of EUA for 1987).
B-20 By-Laws of EUA Energy Investment Corporation (Exhibit B-15 to Form
U5S of EUA for 1987).
B-21 Articles of Incorporation of EUA Ocean State Corporation (Exhibit
B-16 to Form U5S of EUA for 1988).
B-22 By-Laws of EUA Ocean State Corporation (Exhibit B-17 to Form U5S
of EUA for 1988).
B-23 Charter of Newport, as amended (Exhibit B-18 to Form U5S of EUA
for 1990).
B-24 By-Laws of Newport (Exhibit B-19 to Form U5S of EUA for 1990).
B-25 Ocean State Power Amended and Restated General Partnership
Agreement among EUA Ocean State, Ocean State Power Company, TCPL
Power Ltd., Narragansett Energy Resources Company and NECO Power,
Inc. (collectively, the "OSP Partners") dated as of December 2,
1988, and First Amendment thereto dated as of March 27, 1989
(Exhibit 10-107, Form 10-K of EUA for 1989, File No. 1-5366).
B-26 Ocean State Power II Amended and Restated General Partnership
Agreement among EUA Ocean State, JMC Ocean State Corporation,
Makowski Power, Inc., TCPL Power Ltd., Narragansett Energy
Resources Company and Newport Electric Power Corporation
(collectively, the "OSP II Partners") dated as of September 29,
1989 (Exhibit 10-110, Form 10-K of EUA for 1989, File No. 1-5366).
B-27 Second Amendment to B-25 dated December 31, 1990 (Exhibit 10-3.12,
Form 10-K of EUA for 1994, File No. 1-5366).
B-28 Third Amendment to B-25 dated November 12, 1992 (Exhibit 10-4.12,
Form 10-K of EUA for 1994, File No. 1-5366).
B-29 Fourth Amendment to B-25 dated February 23, 1993 (Exhibit 10-5.12,
Form 10-K of EUA for 1994, File No. 1-5366).
B-30 Articles of Organization of EUA Transcapacity, Inc. (Exhibit A-1
File No. 70-8283).
B-31 By-Laws of EUA Transcapacity, Inc. (Exhibit A-2 File No. 70-8283).
B-32 Amended and Restated Agreement of Limited Partnership of
TransCapacity Limited Partnership (Exhibit A-2 File No. 70-8283).
B-33 Articles of Incorporation of EUA Cogenex-Canada (Exhibit A-1 File
No. 70-8441).
B-34 By-Law No. 1 of EUA Cogenex-Canada (Exhibit A-2 File No. 70-8441).
B-35 Articles of Organization of NEM (Exhibit A-2 File No. 70-8255).
B-36 By-Laws of NEM (Exhibit A-3 File No. 70-8255).
Exhibit C -
(a)
C-1 Form of 8% Debenture Bonds due 2000 of Montaup (Exhibit 4-10,
Registration File No. 2-41488).
C-2 Form of 8-1/4% Debenture Bonds due 2003 of Montaup (Exhibit B-3,
Form U5S of EUA for year 1973).
C-3 Form of 14% Debenture Bonds due 2005 of Montaup (Exhibit 4-11,
Registration No. 2-55990).
C-4 Form of 10% Debenture Bonds due 2008 of Montaup (Exhibit 5-3,
Registration No. 2-65785).
C-5 Form of 16-1/2% Debenture Bonds due 2010 of Montaup (Exhibit 4-11,
Form 10-K of EUA for 1980, File No. 1-5366).
C-6 Form of 12-3/8% Debenture Bonds due 2013 of Montaup (Exhibit 4-13,
Form 10-K of EUA for 1983, File No. 1-5366).
C-7 Form of 9% Debenture Bonds due 2020 of Montaup (Exhibit 4-10, Form
10-K of Eastern Edison for 1990, File No. 0-8480).
C-8 Form of 9-3/8% Debenture Bonds due 2020 of Montaup (Exhibit 4-11,
Form 10-K of Eastern Edison for 1990, File No. 0-8480).
C-9 Indenture of First Mortgage and Deed of Trust dated as of
September 1, 1948 of Eastern Edison (Exhibit 4-1, Registration No. 2-
77468).
C-10 First Supplemental Indenture dated as of February 1, 1953 of
Eastern Edison (Exhibit A, File No. 70-3015).
C-11 Second Supplemental Indenture dated as of May 1, 1954 of Eastern
Edison (Exhibit A-3, File No. 70-3371).
C-12 Third Supplemental Indenture dated as of June 1, 1955 of Eastern
Edison (Exhibit C to Certificate of Notification, File No. 70-3371).
C-13 Fourth Supplemental Indenture dated as of September 1, 1957 of
Eastern Edison (Exhibit D to Certificate of Notification, File No.
70-3619).
C-14 Fifth Supplemental Indenture dated as of April 1, 1959 of Eastern
Edison (Exhibit D to Certificate of Notification, File No. 70-3798).
C-15 Sixth Supplemental Indenture dated as of October 1, 1963 of
Eastern Edison (Exhibit F to Certificate of Notification, File No. 70-
4164).
C-16 Seventh Supplemental Indenture dated as of June 1, 1969 of Eastern
Edison (Exhibit D to Certificate of Notification, File No. 70-4748).
C-17 Eighth Supplemental Indenture dated as of July 1, 1972 of Eastern
Edison (Exhibit C to Certificate of Notification, File No. 70-5195).
C-18 Ninth Supplemental Indenture dated as of September 1, 1973 of
Eastern Edison (Exhibit F to Certificate of Notification, File No.
70-5379).
C-19 Tenth Supplemental Indenture dated as of October 1, 1975 of
Eastern Edison (Exhibit C to Certificate of Notification, File No.
70-5719).
C-20 Eleventh Supplemental Indenture dated as of January 1, 1979 of
Eastern Edison (Exhibit 5-24, Registration No. 2-65785).
C-21 Twelfth Supplemental Indenture dated as of October 1, 1980 of
Eastern Edison (Exhibit F to Certificate of Notification, File No.
70-6463).
C-22 Thirteenth Supplemental Indenture dated as of July 1, 1981 of
Eastern Edison (Exhibit C to Certificate of Notification, File No.
70-6608).
C-23 Fourteenth Supplemental Indenture dated as of June 1, 1982 of
Eastern Edison (Exhibit C to Certificate of Notification, File No.
70-6737).
C-24 Fifteenth Supplemental Indenture dated as of August 1, 1983 of
Eastern Edison (Exhibit F to Certificate of Notification, File No.
70-6851).
C-25 Sixteenth Supplemental Indenture dated as of September 1, 1984 of
Eastern Edison (Exhibit 4-31, Form 10-K of EUA for 1984, File No.
1-5366).
C-26 Seventeenth Supplemental Indenture dated as of July 1, 1986 of
Eastern Edison. (Exhibit F to Certificate of Notification, File
No. 70-7254).
C-27 Eighteenth Supplemental Indenture dated as of June 1, 1987 of
Eastern Edison (Exhibit C to Certificate of Notification, File No.
70-7373).
C-28 Nineteenth Supplemental Indenture dated as of November 1, 1987 of
Eastern Edison (Exhibit C to Certificate of Notification, File No.
70-7373).
C-29 Twentieth Supplemental Indenture dated as of May 1, 1988 of
Eastern Edison (Exhibit C to Certificate of Notification, File No. 70-
7373).
C-30 Twenty-first Supplemental Indenture dated as of September 1, 1988
of Eastern Edison (Exhibit F to Certificate of Notification, File
No. 70-7511).
C-31 Twenty-second Supplemental Indenture dated as of December 1, 1990
of Eastern Edison (Exhibit 4-34, Form 10-K of Eastern Edison for
1990, File No. 0-8480).
C-32 Twenty-third Supplemental Indenture dated as of July 1, 1992 of
Eastern Edison (Exhibit 4-24, Form 10-K of Eastern Edison for 1992,
File No. 0-8480).
C-33 Twenty-Fourth Supplemental Indenture of Eastern Edison dated as of
May 1, 1993.
C-34 Twenty-Fifth Supplemental Indenture of Eastern Edison dated as of
July 1, 1993.
C-35 Twenty-Sixth Supplemental Indenture of Eastern Edison dated as of
September 1, 1993.
C-36 Indenture dated as of December 1, 1990 of Eastern Edison with
Citibank, N.A., as Trustee (Exhibit 4-35, Form 10-K of Eastern
Edison for 1990, File No. 0-8480).
C-37 Form of Eastern Edison Medium Term Note (Exhibit 4-36, Form 10-K
of Eastern Edison for 1990, File No. 0-8480).
C-38 First Mortgage Indenture and Deed of Trust dated as of December 1,
1980 of Blackstone (Exhibit A, Form 8-K of EUA dated January 14,
1981, File No. 1-5366).
C-39 First Supplemental Indenture dated as of August 1, 1989 of
Blackstone (Exhibit 4-33, Form 10-K of EUA for 1989, File 1-5366).
C-40 Second Supplemental Indenture dated as of November 26, 1990 of
Blackstone (Exhibit 4-3, Form 10-K of BVE for 1990, File No.
0-2602).
C-41 Loan Agreement between Rhode Island Industrial Facilities
Corporation and Blackstone dated as of December 1, 1984 (Exhibit
10-72, Form 10-K of EUA for 1984, File No. 1-5366).
C-42 Note Purchase Agreement dated as of January 13, 1988 of Service
(Exhibit 4-38, Form 10-K of EUA for 1987, File No. 1-5366).
C-43 Note Agreement dated as of June 28, 1990 of EUA Cogenex with the
Prudential Insurance Company of America (Exhibit 4-46, Form 10-K of
EUA for 1990, File No. 1-5366).
C-44 Note Agreement dated as of October 29, 1991 between EUA Cogenex
and Prudential Insurance Company of America (Exhibit 4-55, Form 10-K of
EUA for 1991, File No. 1-5366).
C-45 Note Purchase Agreement dated as of September 29, 1992 of EUA
Cogenex and the Prudential Life Insurance Company of America
(Exhibit 4-44 to Form 10-K of EUA for 1992, File No. 1-5366).
C-46 Indenture dated September 1, 1994 between EUA Cogenex and the Bank
of New York as Trustee (Exhibit 4-4.10, Form 10-K of EUA for 1993,
File No. 1-5366).
C-47 Guaranty, dated June 28, 1990, made by Eastern Utilities
Associates in favor of The Prudential Insurance Company of America
(Exhibit B-2 to Form U-1, File No. 70-7655, dated June 14, 1990).
C-48 Indenture of First Mortgage dated as of June 1, 1954 of Newport,
as supplemented on August 1, 1959, April 1, 1962, October 1, 1964,
April 1, 1967, September 1, 1969, September 1, 1970, June 1, 1978,
October 1, 1978, May 1, 1986, December 1, 1987 and November 1, 1989
(Exhibit 4-49, Form 10-K of EUA for 1990, File No. 1-5366).
C-49 United States Government Small Business Administration Loan to
Newport entitled, "Base Closing Economic Injury Loan", signed May
30, 1975 and amended on October 6, 1983 (Exhibit 4-50, Form 10-K of
EUA for 1990, File No. 1-5366).
C-50 Indenture of Second Mortgage dated as of September 1, 1982 of
Newport, as supplemented on December 1, 1988 (Exhibit 4-51, Form
10-K of EUA for 1990, File No. 1-5366).
C-51 Loan Agreement between Rhode Island Port Authority and Economic
Development Corporation and Newport dated as of September 1, 1982
(Exhibit 4-52, Form 10-K of EUA for 1990, File No. 1-5366).
C-52 Note Purchase Agreement dated as of January 16, 1992 between EUA
Ocean State Corporation and John Hancock Mutual Life Insurance
Company (Exhibit 4-56, Form 10-K of EUA for 1991, File No. 1-5366).
C-53 Guaranty, dated January 16, 1993 made by EUA in favor of John
Hancock Mutual Life Insurance Company (Exhibit 10-125, Form 10-K of
EUA for 1991, File No. 1-5366).
C-54 Trust Agreement dated as of July 1, 1993 between Massachusetts
Industrial Finance Agency and Shawmut Bank, N.A. (filed as
Exhibit 10-1.08 to Eastern Edison's Form 10-K for 1993, File No.
0-8480).
C-55 Loan Agreement dated as of July 1, 1993 between Massachusetts
Industrial Finance Agency and Eastern Edison (filed as Exhibit
10-2.08 to Eastern Edison's Form 10-K for 1993, File No. 0-8480).
C-56 Power Purchase Agreement entered into as of September 20, 1993 by
and between Meridian Middleboro Limited Partnership and Eastern
Edison Company (filed as Exhibit 10-3.08 to Eastern Edison's Form
10-K for 1993, File No. 0-8480).
C-57 Inducement Letter dated July 14, 1993 from Eastern Edison to the
Massachusetts Industrial Finance Agency and Goldman, Sachs &
Company and Citicorp Securities Markets, Inc. (filed as Exhibit
10-4.08 to Eastern Edison's Form 10-K for 1993, File No. 0-8480).
C-58 Indenture dated September 1, 1993 between EUA Cogenex and the Bank
of New York as Trustee (filed as Exhibit 4-4.10 to EUA's Form 10-K
for 1993, File No. 1-5366).
C-59 Loan Agreement between the Rhode Island Port Authority and
Economic Development Corporation and Newport Electric Corporation dated
as of January 6, 1994 (filed as Exhibit 4-14.14 to EUA's Form 10-K for
1993, File No. 1-5366).
C-60 Trust Indenture between the Rhode Island Authority and Economic
Development Corporation and Newport Electric Corporation dated as
of January 1, 1994 (filed as Exhibit 4-5.14 to EUA's Form 10-K for
1993, File No. 1-5366).
C-61 Letter of Credit and Reimbursement Agreement among Newport and the
Canadian Imperial Bank of Commerce dated January 6, 1994 (filed as
Exhibit 4-6.14 to EUA's Form 10-K for 1993, File No. 1-5366).
C-62 Memorandum of understanding by and between Canal Electric Company
and Montaup Electric Company dated September 23, 1993 (Exhibit
10-39.05, Eastern Edison 10-K for 1993, File No. 0-8480).
C-63 Ancillary Agreement by and between Algonquin Gas Transmission
Company, Canal Electric Company and Montaup Electric Company dated
October 8, 1993 (Exhibit 10-40.05 of Eastern Edison 10-K for 1993,
File No. 0-8480).
(b) None
*Exhibit D - Tax allocation agreement for 1995 pursuant to Rule 45(c).
Exhibit E - Other documents. None.
Exhibit F - Supporting schedules. None.
SIGNATURE
The undersigned system company has duly caused this annual report to be
signed on its behalf by the undersigned thereunto duly authorized, pursuant to
the requirements of the Public Utility Holding Company Act of 1935.
EASTERN UTILITIES ASSOCIATES
and Subsidiaries
By /s/_Richard_M._Burns_____
R. M. Burns, Comptroller
(Principal Accounting Officer)
April 28, 1995
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
ASSETS
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Utility plant and other investments:
Utility plant in service $1,020,858,931 $ $ $30,218,908 $132,775,722
Less accumulated provision for depreciation
and amortization 304,033,925 10,661,086 44,111,526
Net utility plant in service 716,825,006 19,557,822 88,664,196
Construction work in progress (Notes H and J) 8,388,799 106,964 639,251
Net utility plant 725,213,805 19,664,786 89,303,447
Non-utility property 139,171,055 70,206
Less accumulated provision for depreciation 31,367,464 22,108
Net non-utility property 107,803,591 48,098
Investments in subsidiaries (at equity) 70,674,960 348,309,086 348,309,086
Excess of carring values of investments
in subsidiaries 17,488 17,488
Notes receivable 38,269,228
Other 17,129,517 1,000
Total Utility Plant and Other Investments 959,108,589 348,309,086 348,327,574 19,664,786 89,351,545
Current Assets:
Cash and temporary cash investments 20,109,252 49,182 2,612,042 472,420
Notes receivable 13,905,711 16,751,758 16,751,757
Accounts receivable - Net:
Customers 63,708,680 11,002,239
Accrued unbilled revenue 10,178,267 1,216,981
Others 15,460,568 1,259,007 2,013,977 2,735,731
Accounts receivable - associated companies 0 26,818,143 1,387,674 6,334,439 469,666
Materials and Supplies (at average cost):
Fuel 6,412,959
Plant materials and operating supplies 8,755,505 62,161 767,022
Other current assets 8,516,608 49,167 238,061 421,166
Total Current Assets 147,047,550 43,569,901 19,496,787 11,260,680 17,085,225
Deferred Debits:
Unamortized debt expense 6,196,763 143,192 794,856
Unrecovered regulatory plant costs (Note J) 18,400,000
Other deferred debits 103,296,272 7,260,115 719,133 14,181,188
Total Deferred Debits 127,893,035 7,260,115 862,325 14,976,044
Total assets $1,234,049,174 $391,878,987 $375,084,476 $31,787,791 $121,412,814
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS (continued)
DECEMBER 31, 1994
ASSETS
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C>
Utility plant and other investments:
Utility plant in service $75,027,652 $782,836,649 $ $ $
Less accumulated provision for depreciation
and amortization 21,019,294 228,242,019
Net utility plant in service 54,008,358 554,594,630
Construction work in progress (Notes H and J) 883,796 6,758,788
Net utility plant 54,892,154 561,353,418
Non-utility property 2,715,349 135,361,663 1,023,837
Less Accumulated provision for depreciation 9,697 31,223,472 112,187
Net non-utility property 2,705,652 104,138,191 911,650
Investments in subsidiaries (at equity) 13,488,281 654,873 56,531,806
Excess of carring values of investments
in subsidiaries
Notes receivable 38,269,228
Other 50,405 16,644,997 272,913 160,202
Total Utility Plant and Other Investments 54,892,154 577,597,756 159,052,416 1,839,436 56,692,008
Current Assets:
Cash and temporary cash investments 192,163 11,264,668 4,988,324 502,816 27,637
Notes receivable 13,905,712
Accounts receivable - Net:
Customers 4,537,062 25,896,423 22,272,956
Accrued Unbilled Revenue 678,152 8,283,134
Others 1,692,279 3,800,336 1,691,825 1,084,538 1,182,875
Accounts receivable - associated companies 481,167 18,061,452 3,467 80,278
Materials and Supplies (at average cost):
Fuel 69,331 6,343,628
Plant materials and operating supplies 811,184 3,300,114 3,815,024
Other current assets 296,049 5,951,650 1,543,351 11,958 5,206
Total Current Assets 8,757,387 82,901,405 48,220,659 1,599,312 1,295,996
Deferred Debits:
Unamortized debt expense 576,171 3,345,214 861,752 475,578
Unrecovered Regulatory Plant Costs (Note J) 18,400,000
Other deferred debits 4,151,568 73,800,247 3,175,426 8,595
Total Deferred Debits 4,727,739 95,545,461 4,037,178 8,595 475,578
Total assets $68,377,280 $756,044,622 $211,310,253 $3,447,343 $58,463,582
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
LIABILITIES
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C>
Capitalization:
Common equity $365,443,051 $348,309,086 $365,486,963 $4,836,717 $35,243,272
Non-redeemable preferred stock of subsidiaries 6,900,550 6,129,500
Redeemable preferred stock of
subsidiaries - net 29,797,592
Preferred stock redemption cost (4,408,023)
Long-term debt - net 455,411,647 13,400,000 38,000,000
Total Capitalization 853,144,817 348,309,086 365,486,963 18,236,717 79,372,772
Current Liabilites:
Preferred stock sinking fund requirements 50,000
Long-term debt due within one year 41,600,693 1,100,000 1,500,000
Notes payable 31,678,073 16,751,757 8,202,000
Accounts payable 33,442,248 41,188 2,470,314 603,416
Accounts payable - associated companies 0 25,896,134 46,517 64,472 9,508,863
Customer deposits 3,238,034 1,210,115
Taxes accrued 6,464,725 4,417 4,420,497
Interest accrued 10,888,957 922,010 10,473 747,369 1,069,838
Dividends accrued 84,028 72,188
Other current liabilites 26,244,820 2,006,523 90,719 7,391,238
Total Current Liabilties 153,691,578 43,569,901 10,306,701 4,477,291 25,776,155
Deferred Credits:
Unamortized investment credit 23,092,564 2,926,725
Other deferred credits 66,220,387 7,779,918 6,814,578
Total Deferred Credits 89,312,951 7,779,918 9,741,303
Accumulated deferred taxes 137,899,828 (709,188) 1,293,865 6,522,584
Commitments and contingencies (Note J)
Total Liabilities and Capitalization $1,234,049,174 $391,878,987 $375,084,476 $31,787,791 $121,412,814
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS (continued)
DECEMBER 31, 1994
LIABILITIES
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C>
Capitalization:
Common equity $21,741,695 $225,063,845 $48,230,003 ($5,004,026) $18,153,668
Non-redeemable preferred stock of subsidiaries 771,050
Redeemable preferred stock of
subsidiaries - net 133,090 29,664,502
Preferred stock redemption cost (4,408,023)
Long-term debt - net 22,044,551 229,223,560 119,200,000 33,543,536
Total Capitalization 44,690,386 479,543,884 167,430,003 (5,004,026) 51,697,204
Current Liabilites:
Preferred stock sinking fund requirements 50,000
Long-term debt due within one year 724,033 35,000,000 800,000 2,476,660
Notes payable 31,480,000 8,747,830
Accounts payable 341,788 24,578,476 5,221,212 185,643 211
Accounts payable - associated companies 9,936,637 5,749,157 445,887 122,146 22,455
Customer deposits 796,391 1,101,011 130,517
Taxes accrued 502,455 1,411,208 126,148
Interest accrued 676,855 5,485,605 2,652,165 880,799 287,863
Dividends accrued 11,840
Other current liabilites 726,768 15,259,422 614,276 154,018 1,856
Total Current Liabilties 13,766,767 88,584,879 41,470,205 10,090,436 2,789,045
Deferred Credits:
Unamortized investment credit 1,381,914 18,783,925
Other deferred credits 1,945,439 49,475,660 1,076,717 (871,925)
Total Deferred Credits 3,327,353 68,259,585 1,076,717 (871,925)
Accumulated deferred taxes 6,592,774 119,656,274 1,333,328 (767,142) 3,977,333
Commitments and contingencies (Note J)
Total Liabilities and Capitalization $68,377,280 $756,044,622 $211,310,253 $3,447,343 $58,463,582
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF CAPITALIZATION
DECEMBER 31, 1994
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $5 par value of Registrant <F1> $99,684,900 $92,856,906 $99,684,900 $1,000 $9,203,100
Other paid-in capital 212,990,551 123,670,103 212,990,551 4,500,000 17,907,930
Common share expense (3,849,400) (742,215) (3,805,488)
Retained earnings 56,617,000 132,524,292 56,617,000 335,717 8,132,242
Total Common Equity 365,443,051 348,309,086 365,486,963 4,836,717 35,243,272
Non-Redeemable Preferred:
4.25%, $100 par value, 35,000 shares <F2> 3,500,000 3,500,000
5.60%, $100 par value, 25,000 shares <F2> 2,500,000 2,500,000
3.75%, $100 par value, 7,689 shares<F2> 768,900
Premium, net of expense 131,650 129,500
Total Non-Redeemable 6,900,550 6,129,500
Redeemable Preferred:
6.625%, $100 par value, 300,000 shares<F2> 30,000,000
9.75%, $100 par value, 1,900 shares<F2> 190,000
Expense, net of premium (342,408)
Preferred stock redemption cost (4,408,023)
Sinking Fund Due Within One Year (50,000)
Total Redeemable 25,389,569
Long-Term Debt:
Secured Notes:
10.2% due 2008 14,500,000 14,500,000
Unsecured Notes:
9.59% due 2011 36,020,196
7% due 2000 50,000,000
7.22% due 1997 15,000,000
9.6% due 2001 20,000,000
10.56% due 2005 35,000,000
9%-9.25% Series A due 1995 25,000,000
Variable Rate Bonds:
Demand due 2014 <F3> 6,500,000 6,500,000
Revenue Refunding due 2011 <F4> 7,925,000
First Mortgage and Collateral Trust Bonds:
5.875% due 1998 20,000,000
8.9% Secured medium-term notes due 1995 10,000,000
6.875% due 2003 40,000,000
8% due 2023 40,000,000
6.35% due 2003 8,000,000
4.875% due 1996 7,000,000
7.78% Secured medium-term notes due 2002 35,000,000
5.75% due 1998 40,000,000
Pollution Control Revenue Bonds:
5.875% due 2008 40,000,000
First Mortgage Bonds:
9.5% due 2004 (Series B) 15,000,000 15,000,000
10.35% due 2010 (Series C) 18,000,000 18,000,000
9% due 1999 1,400,000
9.8% due 1999 8,000,000
8.95% due 2001 4,550,000
Second Mortgage Bonds:
6.5% SBA Loan due 2005 893,584
Unamortized (Discount) - Net (776,440)
497,012,340 14,500,000 39,500,000
Less portion due within one year 41,600,693 1,100,000 1,500,000
Total Long-Term Debt 455,411,647 13,400,000 38,000,000
Total Capitalization 853,144,817 348,309,086 365,486,963 18,236,717 79,372,772
<FN>
<F1> Authorized 36,000,000 shares, outstanding 19,936,980
<F2> Authorized and Outstanding.
<F3> Weighted average interest rate was 2.9% for 1994.
<F4> Weighted average interest rate was 2.6% for 1994.
</FN>
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF CAPITALIZATION (continued)
DECEMBER 31, 1994
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $5 par value of Registrant <F1> $11,368,779 $72,283,925 $100 $1 $1
Other paid-in capital 9,000,000 47,249,633 33,528,598 375,743 11,108,199
Common share expense (742,215) (43,912)
Retained earnings 2,115,131 105,574,199 14,701,305 (5,379,770) 7,045,468
Total Common Equity 21,741,695 225,063,845 48,230,003 (5,004,026) 18,153,668
Non-Redeemable Preferred:
4.25%, $100 par value, 35,000 shares <F2>
5.60%, $100 par value, 25,000 shares <F2>
3.75%, $100 par value, 7,689 shares <F2> 768,900
Premium, net of expense 2,150
Total Non-Redeemable 771,050
Redeemable Preferred:
6.625%, $100 par value, 300,000 shares<F2> 30,000,000
9.75%, $100 par value, 1,900 shares<F2> 190,000
Expense, net of premium (6,910) (335,498)
Preferred stock redemption cost (4,408,023)
Sinking Fund Due Within One Year (50,000)
Total Redeemable 133,090 25,256,479
Long-Term Debt:
Secured Notes:
10.2% due 2008
Unsecured Notes:
9.59% due 2011 36,020,196
7% due 2000 50,000,000
7.22% due 1997 15,000,000
9.6% due 2001 20,000,000
10.56% due 2005 35,000,000
9%-9.25% Series A due 1995 25,000,000
Variable Rate Bonds:
Demand due 2014 <F3>
Revenue Refunding due 2011 <F4> 7,925,000
First Mortgage and Collateral Trust Bonds:
5.875% due 1998 20,000,000
8.9% Secured medium-term notes due 1995 10,000,000
6.875% due 2003 40,000,000
8% due 2023 40,000,000
6.35% due 2003 8,000,000
4.875% due 1996 7,000,000
7.78% Secured medium-term notes due 2002 35,000,000
5.75% due 1998 40,000,000
Pollution Control Revenue Bonds:
5.875% due 2008 40,000,000
First Mortgage Bonds:
9.5% due 2004 (Series B)
10.35% due 2010 (Series C)
9% due 1999 1,400,000
9.8% due 1999 8,000,000
8.95% due 2001 4,550,000
Second Mortgage Bonds:
6.5% SBA Loan due 2005 893,584
Unamortized (Discount) - Net (776,440)
22,768,584 264,223,560 120,000,000 36,020,196
Less portion due within one year 724,033 35,000,000 800,000 2,476,660
Total Long-Term Debt 22,044,551 229,223,560 119,200,000 33,543,536
Total Capitalization 44,690,386 479,543,884 167,430,003 (5,004,026) 51,697,204
<FN>
<F1> Authorized 36,000,000 shares, outstanding 19,936,980
<F2> Authorized and Outstanding.
<F3> Weighted average interest rate was 2.9% for 1994.
<F4> Weighted average interest rate was 2.6% for 1994.
</FN>
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues $564,277,614 $130,012,998 $ $ $140,610,560
Operating Expenses:
Operation 378,638,206 167,715,142 1,554,456 38,087,206 113,219,549
Maintenance 23,509,910 1,017,591 1,424 1,028,153 2,941,661
Depreciation and amortization 46,454,685 844,229 2,056 1,397,250 5,303,057
Taxes - Other than income 24,336,724 2,040,651 10,424 2,057,259 9,202,006
- Income (credit) 7,705,495 245,754 161 (1,096,849) 1,709,182
- Deferred (credit) 10,502,682 (100,407) (34) 1,055,207 176,170
Total Operating Expenses 491,147,702 171,762,960 1,568,487 42,528,226 132,551,625
Operating Income 73,129,912 (41,749,962) (1,568,487) (42,528,226) 8,058,935
Other Income and Deductions:
Interest and dividend income 5,527,204 660,632 764,138 2,847 94,952
Equity in earnings of jointly-
owned companies 12,485,191 48,608,964 48,608,964
Allowance for other funds used during
construction 351,221 38,550
Other income (deductions) - net 1,984,325 43,239,732 271,082 44,469,608 (16,563)
Total Other Income 20,347,941 92,509,328 49,644,184 44,472,455 116,939
Income Before Interest Charges 93,477,853 50,759,366 48,075,697 1,944,229 8,175,874
Interest Charges:
Interest on long-term debt 38,987,023 1,479,000 3,475,654
Amortization of debt expense and premium 2,728,728 22,714 115,491
Other interest expense (principally
short-term notes) 3,849,768 2,150,402 706,059 20,901 893,141
Allowance for borrowed funds used during
construction - (credit) (1,788,226) (35,971)
Total Interest Charges 43,777,293 2,150,402 706,059 1,522,615 4,448,315
Net Income 49,700,560 48,608,964 47,369,638 421,614 3,727,559
Preferred Dividends Requirement 2,330,922 288,750
Earnings available for common shareholders $47,369,638 $48,608,964 $47,369,638 $421,614 $3,438,809
Earnings per EUA Common Share
weighted average shares outstanding: 19,671,970
$2.41
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENTS (continued)
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues $60,775,782 $418,424,556 $74,479,714 $ $
Operating Expenses:
Operation 47,304,425 298,596,312 45,291,875 2,103,792 195,733
Maintenance 2,076,267 14,667,446 3,810,370 125 2,055
Depreciation and amortization 2,560,381 25,545,580 12,252,053 101,881 136,656
Taxes - Other than income 3,884,245 10,542,565 663,175 10,521 7,180
- Income (credit) 584,413 10,262,784 (2,152,931) 912 (1,356,423)
- Deferred (credit) 579,442 5,567,485 3,024,786 (781)
Total Operating Expenses 56,989,173 365,182,172 62,889,328 2,217,231 (1,015,580)
Operating Income 3,786,609 53,242,384 11,590,386 (2,217,231) 1,015,580
Other Income and Deductions:
Interest and dividend income 118,911 483,093 4,693,777 21,368 8,750
Equity in earnings of jointly-
owned companies 1,700,065 10,785,126
Allowance for other funds used during
construction 49,198 263,473
Other income (deductions) - net 303,020 413,716 (1,692,196) 1,255,039 220,351
Total Other Income 471,129 2,860,347 3,001,581 1,276,407 11,014,227
Income Before Interest Charges 4,257,738 56,102,731 14,591,967 (940,824) 12,029,807
Interest Charges:
Interest on long-term debt 1,732,813 18,487,874 10,199,004 3,612,678
Amortization of debt expense and premium 120,283 2,290,728 151,537 27,975
Other interest expense (principally
short-term notes) 336,588 2,235,471 1,478,760 295,930 33,320
Allowance for borrowed funds used during
construction - (credit) (50,127) (294,229) (1,407,899)
Total Interest Charges 2,139,557 22,719,844 10,421,402 295,930 3,673,973
Net Income 2,118,181 33,382,887 4,170,565 (1,236,754) 8,355,834
Preferred Dividends Requirement 54,672 1,987,500
Earnings available for common shareholders $2,063,509 $31,395,387 $4,170,565 ($1,236,754) $8,355,834
Earnings per EUA Common Share
weighted average shares outstanding
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income (Loss) $49,700,560 $48,608,964 $47,369,638 $421,614 $3,727,559
Adjustments to Reconcile Net Income (loss)
to Net Cash Provided by Operating Activities:
Depreciation and amortization 54,091,082 (7,601) 490,483 1,420,024 6,157,355
Amortization of nuclear fuel 3,310,346
Deferred taxes 8,016,841 (92,093) (2,716,301) 1,055,207 176,170
Gains on Sales of Investments in Energy Savings
Projects Paid for with Notes Receivable (5,473,617)
Investment tax credit, net (181,426) 253,119
Allowance for funds used during construction (351,223) (38,550)
Other - net (4,503,699) (7,614,695) (6,413,534) 2,227,155 (6,070,685)
Net Changes to Working Capital:
Accounts receivable (4,507,855) (7,758,965) 6,490,316 (1,523,987) (603,375)
Materials and supplies (2,035,981) (13,216) (26,856)
Notes receivable (3,978,830) (3,978,830)
Accounts payable (2,668,296) 7,478,617 (148,081) 849,050 1,484,169
Accrued taxes (5,833,899) (3,065) (1,280,977)
Other - net 9,641,522 280,347 (1,231,661) (56,206) 5,453,621
Net Cash Provided from (Used in) Operating Activitie 99,204,355 36,915,744 39,862,030 4,376,576 9,231,550
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures (50,519,361) (309,755) (5,652,909)
Collections on Notes and Lease Receivables of EUA Co 12,750,123
Acquisition of Northeast Energy Management, Inc. (8,567,456)
Acquisition of partnership interest in Energy
Capital & Services I & II (2,485,940)
Increase in other investments (275,000)
Investments in subsidiaries 850,000 850,000
Net Cash Used in Investing Activities (49,097,634) 850,000 850,000 (309,755) (5,652,909) CASH
FLOW FROM FINANCING ACTIVITIES:
Issuances:
Common shares/capital contribution 9,537,354 (850,000) 9,537,354 (500,000)
Long-term debt 7,925,000
Redemptions:
Long-term debt (13,233,362) (1,100,000)
Preferred stock (100,000)
Premium on reacquisition and financing expenses (688,582) (27,226)
EUA common share dividends paid (29,794,976) (40,894,574) (29,794,976) (3,574,485)
Subsidiary preferred dividends paid (2,333,359) (288,750)
Net (decrease) increase in short-term debt (5,489,927) 3,978,830 (20,378,000)
Net Cash Provided from (Used in) Financing Activities (34,177,852) (37,765,744) (40,662,848) (1,600,000) (3,863,235)
NET (DECREASE) INCREASE IN CASH 15,928,869 49,182 2,466,821 (284,594)
Cash and temporary cash investments at beginning of year 4,180,383 145,221 757,014
Cash and temporary cash investments at end of year $20,109,252 $49,182 $2,612,042 $472,420
Cash paid during the year for:
Interest (net of amount capitalized) $39,649,711 $1,292,373 $1,559,740 $3,506,384
Income Taxes(Refund) $15,233,297 ($4,409,382) $343,889 $1,835,990
Conversion of investments in energy savings projects
to notes and leases receivable 10,706,249
( ) Denotes Contra
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income (Loss) $2,118,181 $33,382,887 $4,170,565 ($1,236,754) $8,355,834
Adjustments to Reconcile Net Income (Loss)
to Net Cash Provided by Operating Activities:
Depreciation and amortization 3,288,719 28,981,135 13,482,605 100,274 162,886
Amortization of nuclear fuel 3,310,346
Deferred taxes 579,442 5,500,261 3,032,593 297,376
Gains on Sales of Investments in Energy Savings
Projects Paid for with Notes Receivable (5,473,617)
Investment tax credit, net (86,160) (348,385)
Allowance for funds used during construction (49,198) (263,475)
Other - net (324,354) (3,285,019) (783,197) (831,899) 3,363,139
Net Changes to Working Capital:
Accounts receivable 267,903 (7,667,948) (7,022,883) (952,823) (1,254,023)
Materials and supplies 7,831 194,059 (2,197,799)
Notes receivable
Accounts payable 2,781,984 3,495,280 (3,888,327) 237,228 (982)
Accrued taxes (6,157) (2,814,023) (865,881) (863,796)
Other - net (179,823) 4,485,858 1,038,980 432,781 (21,681)
Net Cash Provided from (Used in) Operating Activitie 8,398,368 64,970,976 1,493,039 (2,251,193) 10,038,753
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures (3,711,769) (23,613,602) (16,224,859) (1,006,467)
Collections on Notes and Lease Receivables of EUA Cogenex 12,750,123
Acquisition of Northeast Energy Management, Inc. (8,567,456)
Acquisition of partnership interest in Energy
Capital & Services I & II (2,485,940)
Increase/Decrease in other investments (275,000)
Investments in subsidiaries
Net Cash Used in Investing Activities (3,711,769) (23,613,602) (14,528,132) (1,281,467)
CASH FLOW FROM FINANCING ACTIVITIES:
Issuances:
Common shares/capital contribution (350,000)
Preferred stock
Long-term debt 7,925,000
Redemptions:
Long-term debt (9,656,702) (2,476,660)
Preferred stock (100,000)
Premium on reacquisition and financing expenses (592,189) (61,899) (7,268)
EUA common share dividends paid (2,160,000) (28,740,089) (6,420,000)
Subsidiary preferred dividends paid (57,109) (1,987,500)
Net (decrease) increase in short-term debt 15,601,000 4,033,903 (768,000)
Net Cash Provided from (Used in) Financing Activities (4,641,000) (30,789,488) 15,593,732 4,033,903 (10,014,660)
NET (DECREASE) INCREASE IN CASH 45,599 10,567,886 2,558,639 501,243 24,093
Cash and temporary cash investments at beginning of year 146,564 696,782 2,429,685 1,573 3,544
Cash and temporary cash investments at end of year $192,163 $11,264,668 $4,988,324 $502,816 $27,637
Cash paid during the year for:
Interest (net of amount capitalized) $2,022,503 $18,406,075 $9,006,063 $3,856,573
Income Taxes(Refund) $31,156 $15,876,917 $1,610,895 ($185,622) $129,454
Conversion of investments in energy savings projects
to notes and leases receivable 10,706,249
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL
DECEMBER 31, 1994
<CAPTION>
Blackstone
Eastern EUA Valley
EUA Utilities Service Electric
Consolidated Eliminations Associates Corporation Company
<S> <C> <C> <C> <C> <C> <C>
Balance of retained earnings at begining of year $39,642,494 $125,519,665 $39,663,402 ($85,897) $8,267,918
Additions:
Net Income (Loss) 49,700,560 48,608,964 47,369,638 421,614 3,727,559
Total 89,343,054 174,128,629 87,033,040 335,717 11,995,477
Deductions:
Dividends:
Preferred - subsidiaries 2,330,922 288,750
Common - subsidiaries 40,894,574 3,574,485
Common - registrant - $1.515 per share 29,794,976 29,794,976
Total Dividends 32,125,898 40,894,574 29,794,976 3,863,235
Other 600,156 709,762 621,064
Total Deductions 32,726,054 41,604,336 30,416,040 3,863,235
Balance of retained earnings at end of year $56,617,000 $132,524,293 $56,617,000 $335,717 $8,132,242
Other Paid-In Capital at Beginning of Year $202,181,825 $202,181,825
Additions:
Excess of aggregate sales price over par value of 424,942 EUA
Common Shares issued during 1994, in connection with
the EUA Dividend Reinvestment and Common Share
Purchase Plan and Employee Share Ownership Plans at
an average price of $22.44 per Common Share 7,412,644 7,412,644
J.L. Day Company acquisition adjustment
in April (12,499 shs.) 281,560 281,560
Northeast Energy Management Inc. acquisition
January (464,579 shs.) 2,467,061 2,467,061
Amortization restricted stock costs 225,182 225,182
Restricted stock issue February (2,362 shs.) 47,535 47,535
TransCapacity investment 374,744 374,744
Other Paid-In Capital at End of Year $212,990,551 $212,990,551
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN UTILITIES ASSOCIATES AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL (continued)
DECEMBER 31, 1994
<CAPTION>
EUA
Newport Eastern EUA Energy EUA
Electric Edison Cogenex Investment Ocean State
Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C>
Balance of retained earnings at begining of year $2,215,258 $103,515,420 $10,619,439 ($4,143,015) $5,109,634
Additions:
Net Income (Loss) 2,118,181 33,382,887 4,170,565 (1,236,754) 8,355,834
Total 4,333,439 136,898,307 14,790,004 (5,379,769) 13,465,468
Deductions:
Dividends:
Preferred - subsidiaries 54,672 1,987,500
Common - subsidiaries 2,160,000 28,740,089 6,420,000
Common - registrant - $1.515 per share
Total Dividends 2,214,672 30,727,589 6,420,000
Other 3,636 596,519 88,699
Total Deductions 2,218,308 31,324,108 88,699 0 6,420,000
Balance of retained earnings at end of year $2,115,131 $105,574,199 $14,701,305 ($5,379,769) $7,045,468
Other Paid-In Capital at Beginning of Year
Additions:
Excess of aggregate sales price over par value of 424,942 EUA
Common Shares issued during 1994, in connection with
the EUA Dividend Reinvestment and Common Share
Purchase Plan and Employee Share Ownership Plans at
an average price of $22.44 per Common Share
J.L. Day Company acquisition adjustment
in April (12,499 shs.)
Northeast Energy Management Inc. acquisition
January (464,579 shs.)
Amortization restricted stock costs
Restricted stock issue February (2,362 shs.)
TransCapacity investment
Other Paid-In Capital at End of Year
( ) Denotes Contra
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
ASSETS Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Utility plant and other investments:
Utility plant in service $782,836,649 $221,515,677 $561,320,972
Less accumulated provision for depreciation
and amortization 228,242,019 71,090,823 157,151,196
------------ --------------- ------------ ------------
Net Utility plant in service 554,594,630 150,424,854 404,169,776
Construction work in progress (Notes H and J) 6,758,788 971,226 5,787,562
------------ --------------- ------------ ------------
Net utility plant 561,353,418 151,396,080 409,957,338
------------ --------------- ------------ ------------
Non-utility property 2,715,349 105,735 2,609,614
Less accumulated provision for depreciation 9,697 9,697
------------ --------------- ------------ ------------
Net non-utility property 2,705,652 96,038 2,609,614
Investments in subsidiaries (at equity) 13,488,281 366,577,108 366,577,108 13,488,281
Other 50,405 50,405
------------ --------------- ------------ ------------
Total Utility Plant and Other Investments 577,597,756 366,577,108 518,119,631 426,055,233
------------ --------------- ------------ ------------
Current Assets:
Cash and temporary cash investments 11,264,668 102,391 11,162,277
Accounts receivable - Net:
Customers 25,896,423 24,760,167 1,136,256
Accrued unbilled revenue 8,283,134 8,283,134
Others 3,800,336 2,233,201 1,567,135
Accounts receivable - associated companies 18,061,452 40,582,153 5,630,340 53,013,265
Materials and supplies (at average cost):
Fuel 6,343,628 6,343,628
Plant materials and operating supplies 3,300,114 1,276,833 2,023,281
Other current assets 5,951,650 508,786 5,442,864
------------ --------------- ------------ ------------
Total Current Assets 82,901,405 40,582,153 42,794,852 80,688,706
------------ --------------- ------------ ------------
Deferred Debits:
Unamortized debt expense 3,345,214 3,314,689 30,525
Unrecovered Regulatory Plant Costs (Note J) 18,400,000 18,400,000
Other deferred debits 73,800,247 29,466,586 44,333,661
------------ --------------- ------------ ------------
Total Deferred Debits 95,545,461 32,781,275 62,764,186
------------ --------------- ------------ ------------
Total assets $756,044,622 $407,159,261 $593,695,758 $569,508,125
============ =============== ============ ============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
LIABILITIES Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Capitalization:
Common equity $225,063,845 $193,177,995 $225,063,845 $193,177,995
Redeemable preferred stock of
subsidiaries - net 29,664,502 1,500,000 29,664,502 1,500,000
Preferred Stock Redemption Cost (4,408,023) (4,408,023)
Long-term debt - net 229,223,560 171,899,113 229,223,560 171,899,113
------------ --------------- ------------ ------------
Total Capitalization 479,543,884 366,577,108 479,543,884 366,577,108
------------ --------------- ------------ ------------
Current Liabilites:
Long Term Debt due within one year 35,000,000 35,000,000
Accounts payable 24,578,476 1,491,680 23,086,796
Accounts payable - associated companies 5,749,157 35,450,653 38,025,122 3,174,688
Customer deposits 1,101,011 1,101,011
Taxes accrued 1,411,208 725,048 686,160
Interest accrued 5,485,605 5,131,500 5,270,296 5,346,809
Other current liabilities 15,259,422 1,659,604 13,599,818
------------ --------------- ------------ ------------
Total Current Liabilities 88,584,879 40,582,153 83,272,761 45,894,271
------------ --------------- ------------ ------------
Deferred Credits:
Unamortized investment credit 18,783,925 4,545,680 14,238,245
Other deferred credits 49,475,660 9,570,791 39,904,869
------------ --------------- ------------ ------------
Total Deferred Credits 68,259,585 14,116,471 54,143,114
------------ --------------- ------------ ------------
Accumulated deferred taxes 119,656,274 16,762,642 102,893,632
------------ --------------- ------------ ------------
Commitments and contingencies (Note J)
Total liabilities and capitalization $756,044,622 $407,159,261 $593,695,758 $569,508,125
============ =============== ============ ============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATING STATEMENTS OF CAPITALIZATION
DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $5 par value of Registrant $72,283,925 $68,600,000 $72,283,925 $68,600,000
Other paid-in capital 47,249,633 29,528,000 47,249,633 29,528,000
Common share expense (43,912) 0 (43,912)
Retained earnings 105,574,199 95,049,995 105,574,199 95,049,995
------------ --------------- ------------ ------------
Total Common Equity 225,063,845 193,177,995 225,063,845 193,177,995
------------ --------------- ------------ ------------
Redeemable Preferred:
6.625%, $100 par value, 300,000 shares 30,000,000 1,500,000 30,000,000 1,500,000
Expense, net of premium (335,498) 0 (335,498)
Preferred stock redemption cost (4,408,023) 0 (4,408,023)
------------ --------------- ------------ ------------
Total Redeemable 25,256,479 1,500,000 25,256,479 1,500,000
------------ --------------- ------------ ------------
Long-Term Debt:
Unsecured Notes: 0
9%-9.25% Series A due 1995 25,000,000 0 25,000,000
First Mortgage and Collateral Trust Bonds: 0
5.875% due 1998 20,000,000 0 20,000,000
8.9% Secured medium-term notes due 1995 10,000,000 0 10,000,000
6.875% due 2003 40,000,000 0 40,000,000
8% due 2023 40,000,000 0 40,000,000
6.35% due 2003 8,000,000 0 8,000,000
4.875% due 1996 7,000,000 0 7,000,000
7.78% Secured medium-term notes due 2002 35,000,000 0 35,000,000
5.75% due 1998 40,000,000 0 40,000,000
Pollution Control Revenue Bonds:
5.875% due 2008 $40,000,000 0 $40,000,000
Debenture Bonds:
8% due 2000 0 8,500,000 8,500,000
8.25% due 2003 0 12,800,000 12,800,000
14% due 2005 0 26,000,000 26,000,000
10% due 2008 0 9,275,000 9,275,000
16.5% due 2010 0 19,000,000 19,000,000
12.375% due 2013 0 30,000,000 30,000,000
10.125% due 2008 0 36,324,113 36,324,113
9% due 2020 0 5,000,000 5,000,000
9.375% due 2020 0 25,000,000 25,000,000
Unamortized (Discount) - Net (776,440) 0 (776,440) 0
------------ --------------- ------------ ------------
264,223,560 171,899,113 264,223,560 171,899,113
Less portion due within one year 35,000,000 0 35,000,000
------------ --------------- ------------ ------------
Total Long-Term Debt 229,223,560 171,899,113 229,223,560 171,899,113
------------ --------------- ------------ ------------
Total Capitalization $479,543,884 $366,577,108 $479,543,884 $366,577,108
============ =============== ============ ============
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATING INCOME STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Operating Revenues $418,424,556 $194,239,358 $267,148,996 $345,514,918
Operating Expenses:
Operation $298,596,312 194,239,358 225,676,381 267,159,289
Maintenance 14,667,446 5,133,393 9,534,053
Depreciation and amortization 25,545,580 9,228,257 16,317,323
Taxes - Other than income 10,542,565 4,357,259 6,185,306
- Income 10,262,784 6,364,848 3,897,936
- Deferred 5,567,485 701,014 4,866,471
------------ --------------- ------------ ------------
Total Operating Expenses 365,182,172 194,239,358 251,461,152 307,960,378
------------ --------------- ------------ ------------
Operating Income 53,242,384 0 15,687,844 37,554,540
------------ --------------- ------------ ------------
Other Income and Deductions:
Interest and dividend income 483,093 19,994,750 20,058,878 418,965
Equity in earnings of jointly-owned companies 1,700,065 19,340,532 19,340,532 1,700,065
Allowance for funds used during construction 263,473 91,459 172,014
Other income (deductions) - net 413,716 (34,331) 448,047
------------ --------------- ------------ ------------
Total Other Income 2,860,347 39,335,282 39,456,538 2,739,091
------------ --------------- ------------ ------------
Income Before Interest Charges 56,102,731 39,335,282 55,144,382 40,293,631
------------ --------------- ------------ ------------
Interest Charges:
Interest on long-term debt 18,487,874 19,994,750 18,487,874 19,994,750
Amortization of debt expense and premium 2,290,728 2,029,316 261,412
Other interest expense (principally
short-term notes) 2,235,471 1,321,581 913,890
Allowance for borrowed funds used during
construction - (credit) (294,229) (77,276) (216,953)
------------ --------------- ------------ ------------
Total Interest Charges 22,719,844 19,994,750 21,761,495 20,953,099
------------ --------------- ------------ ------------
Income After Interest Charges 33,382,887 19,340,532 33,382,887 19,340,532
------------ --------------- ------------ ------------
Preferred Dividends Requirement 1,987,500 1,987,500
------------ --------------- ------------ ------------
Net Income $31,395,387 $19,340,532 $31,395,387 $19,340,532
============ =============== ============ ============
Eastern Edison Common Share weighted
average shares outstanding 2,891,357
Earnings per share $10.86
============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Income After Interest Charges $33,382,887 $19,340,532 $33,382,887 $19,340,532
Adjustments to Reconcile Net Income
to Net Cash Provided by Operating Activities:
Depreciation and Amortization 28,981,135 11,866,200 17,114,935
Amortization of nuclear fuel 3,310,346 3,310,346
Deferred taxes 5,500,261 701,014 4,799,247
Investment tax credit, net (348,385) (316,896) (31,489)
Allowance for funds used during construction (263,475) (91,460) (172,015)
Other - Net (3,285,019) (217,252) (1,312,841) (2,189,430)
Net Changes to Working Capital:
Accounts receivable (7,667,948) 4,272,057 (229,715) (3,166,176)
Materials and supplies 194,059 241,193 (47,134)
Accounts payable 3,495,280 (4,272,057) (3,234,819) 2,458,042
Accrued taxes (2,814,023) 388,547 (3,202,570)
Other - net 4,485,858 1,052,643 3,433,215
------------ --------------- ------------ ------------
Net Cash Provided from
Operating Activities 64,970,976 19,123,280 42,446,753 41,647,503
------------ --------------- ------------ ------------
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures (23,613,602) (11,555,820) (12,057,782)
------------ --------------- ------------ ------------
Net Cash Used in Investing Activities (23,613,602) 0 (11,555,820) (12,057,782)
------------ --------------- ------------ ------------
CASH FLOW FROM FINANCING ACTIVITIES:
Issuances:
Preferred Stock 0 0
Long-term debt 0 0
Redemptions:
Long-term debt 0 0
Preferred stock 0 0
Premium on reacquisition and
financing expenses (61,899) 0 (61,899)
Eastern Edison common share dividends paid (28,740,089) (18,714,080) (28,740,089) (18,714,080)
Subsidiary preferred dividends paid (1,987,500) (409,200) (1,987,500) (409,200)
------------ --------------- ------------ ------------
Net Cash Used in Financing Activities (30,789,488) (19,123,280) (30,789,488) (19,123,280)
------------ --------------- ------------ ------------
NET INCREASE IN CASH 10,567,886 101,445 10,466,441
Cash and temporary cash investments
at beginning of year 696,782 946 695,836
Cash and temporary cash investments ------------ --------------- ------------ ------------
at end of year $11,264,668 $102,391 $11,162,277
============ =============== ============ ============
Cash paid during the year for:
Interest $18,406,075 $19,994,750 $18,559,021 $19,841,804
Income Taxes $15,876,917 $7,616,330 $8,260,587
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EASTERN EDISON COMPANY AND SUBSIDIARY
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL
DECEMBER 31, 1994
<CAPTION>
Eastern Eastern Montaup
Edison Edison Electric
Consolidated Eliminations Company Company
------------ --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Balance of retained earnings at begin. of year $103,515,420 $94,832,744 $103,515,420 $94,832,744
Additions:
Income after interest charges 33,382,887 19,340,532 33,382,887 19,340,532
------------ --------------- ------------ ------------
Total 136,898,307 114,173,276 136,898,307 114,173,276
------------ --------------- ------------ ------------
Deductions:
Dividends:
Preferred - subsidiaries 1,987,500 409,200 1,987,500 409,200
Common - subsidiaries 28,740,089 18,714,080 28,740,089 18,714,080
------------ --------------- ------------ ------------
Total Dividends 30,727,589 19,123,280 30,727,589 19,123,280
Other 596,519 0 596,519
------------ --------------- ------------ ------------
Total Deductions 31,324,108 19,123,280 31,324,108 19,123,280
------------ --------------- ------------ ------------
Balance of retained earnings at end of year $105,574,199 $95,049,996 $105,574,199 $95,049,996
============ =============== ============ ============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION>
ASSETS
Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
Utility Plant and Other Investments:
Utility plant in service $ $ $ $ $ $
Less accumulated provision for
depreciation and amortization 0
Net utility plant in service 0
Construction work in progress
(Notes H and J) 0
Net utility plant 0 0 0
Non-utility property 135,361,663 62,279,447 8,693,923 2,626,602 2,631,406
Less accumulated provision for
depreciation 31,223,472 18,452,110 1,929,054 1,160,876 365,191
Net non-utility property 104,138,191 43,827,337 6,764,869 1,465,726 2,266,215
Investments in subsidiaries (at equity) 0 78,372,404 78,372,404
Excess of carring values of investments
in subsidiaries 0
Notes receivable 38,269,228 38,269,228
Other 16,644,997 16,034,309 408,337 2,587 3,689
Total Utility Plant and Other 159,052,416 78,372,404 176,503,278 7,173,206 1,468,313 2,269,904
Current Assets:
Cash and temporary cash investments 4,988,324 1,321,705 292,277 52,445 62,491
Notes receivable 13,905,712 9,589,330 1,592,865 316,694
Accounts receivable - Net:
Customers 22,272,956 15,748,931 654,455 247,975 808,849
Accrued unbilled revenue 0
Others 1,691,825 3,018,705 4,675,695 34,835
Accounts receivable - associated
companies 3,467 2,641 2,932 3,176
Materials and supplies (at average cost):
Fuel 0
Plant materials and
operating supplies 3,815,024 3,635,534 5,341
Other current assets 1,543,351 1,378,106 18,928 17,570
Total Current Assets 48,220,659 3,021,346 36,352,233 984,743 1,912,213 1,210,945
Deferred Debits:
Unamortized debt expense 861,752 861,752
Unrecovered regulatory plant
costs (Note J) 0
Other deferred debits 3,175,426 1,730,862 1,444,564
Total Deferred Debits 4,037,178 2,592,614 1,444,564 0 0
Total Assets $211,310,253 $81,393,750 $215,448,125 $9,602,513 $3,380,526 $3,480,849
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS (continued)
DECEMBER 31, 1994
ASSETS
<CAPTION> EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
Utility Plant and Other Investments:
Utility plant in service $ $ $ $ $
Less accumulated provision for
depreciation and amortization
Net utility plant in service
Construction work in progress
(Notes H and J)
Net utility plant 0 0 0
Non-utility property 15,724,427 18,961,700 275,471 8,253,240 15,915,447
Less accumulated provision for
depreciation 2,729,796 4,256,817 162,002 561,185 1,606,441
Net non-utility property 12,994,631 14,704,883 113,469 7,692,055 14,309,006
Investments in subsidiaries (at equity)
Excess of carring values of investments
in subsidiaries
Notes receivable
Other 64,744 58 390 45,754 85,129
Total Utility Plant and Other
Investments 13,059,375 14,704,941 113,859 7,737,809 14,394,135
Current Assets:
Cash and temporary cash investments 1,818,200 116,678 17,374 149,173 1,157,981
Notes receivable 2,406,823
Accounts receivable - Net:
Customers 1,138,478 1,130,429 26,923 497,772 2,019,144
Accrued unbilled revenue
Others
Accounts receivable - associated companies
Materials and supplies (at average cost):
Fuel
Plant materials and operating supplies 174,149
Other current assets 47,826 80,400 521
Total Current Assets 5,411,327 1,501,656 44,818 646,945 3,177,125
Deferred Debits:
Unamortized debt expense
Unrecovered regulatory plant costs (Note J)
Other deferred debits
Total Deferred Debits 0 0 0 0 0
Total Assets $18,470,702 $16,206,597 $158,677 $8,384,754 $17,571,260
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION>
LIABILITIES Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
Capitalization:
Common equity $48,230,003 $12,852,920 $48,318,704 $12,764,219 $ $
Non-redeemable preferred stock
of subsidiaries 0
Redeemable preferred stock of
subsidiaries - net 0
Preferred stock redemption cost 0
Partnerships' capital 0 4,432,342 (1,859,411) 271,020
Long-term debt - net 119,200,000 43,150,972 119,200,000 3,612,404 1,533,792
Total Capitalization 167,430,003 60,436,234 167,518,704 12,764,219 1,752,993 1,804,812
Current Liabilites:
Preferred stock sinking fund requirements 0
Long-term debt due within one year 800,000 800,000
Notes payable 31,480,000 9,088,698 31,480,000 484,946 33,351
Accounts payable 5,221,212 9,079,152 5,221,212 1,117,986 1,507,721
Accounts payable - associated companies 445,887 2,741 445,987 2,641
Customer deposits 130,517 1,215
Taxes accrued 126,148 126,148
Interest accrued 2,652,165 2,652,165
Dividends accrued 0
Other current liabilites 614,276 1,661,642 503,019 24,601 134,965
Total Current Liabilties 41,470,205 19,832,233 41,229,746 2,641 1,627,533 1,676,037
Deferred Credits:
Unamortized investment credit 0
Other deferred credits 1,076,717 1,125,283 1,350,466 851,534
Total Deferred Credits 1,076,717 1,125,283 1,350,466 851,534 0 0
Accumulated deferred taxes 1,333,328 5,349,209 (4,015,881)
Commitments and contingencies (Note J)
Total Liabilities and
Capitalization $211,310,253 $81,393,750 $215,448,125 $9,602,513 $3,380,526 $3,480,849
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEETS (continued)
DECEMBER 31, 1994
LIABILITIES
<CAPTION>
EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
Capitalization:
Common equity $ $ $ $ $
Non-redeemable preferred
stock of subsidiaries
Redeemable preferred stock of
subsidiaries - net
Preferred stock redemption cost
Partnerships' capital 454,495 (777,412) (281,292) 2,484,391 4,140,551
Long-term debt - net 14,161,889 13,202,737 130,887 3,294,059 7,215,204
Total Capitalization 14,616,384 12,425,325 (150,405) 5,778,450 11,355,755
Current Liabilites:
Preferred stock sinking fund
requirements
Long-term debt due within one year
Notes payable 816,348 25,224 2,448,587 5,280,242
Accounts payable 2,485,358 2,880,977 283,858 114,553 688,699
Accounts payable - associated companies
Customer deposits 0 38,891 90,411
Taxes accrued
Interest accrued
Dividends accrued
Other current liabilites 1,368,960 83,947 4,273 156,153
Total Current Liabilties 3,854,318 3,781,272 309,082 2,606,304 6,215,505
Deferred Credits:
Unamortized investment credit
Other deferred credits
Total Deferred Credits 0 0 0 0
Accumulated deferred taxes
Commitments and contingencies (Note J)
Total Liabilities and
Capitalization $18,470,702 $16,206,597 $158,677 $8,384,754 $17,571,260
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF CAPITALIZATION
DECEMBER 31, 1994
<CAPTION>
Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $.01 par value
of Registrant (1) $100 $1,100 $100 $1,100 $ $
Other paid-in capital 33,528,598 11,502,050 33,528,598 11,502,050
Partners' capital 0 4,432,342 (1,859,411) 271,020
Common share expense 0
Retained earnings 14,701,305 1,349,770 14,790,006 1,261,069
Total Common Equity 48,230,003 17,285,262 48,318,704 12,764,219 (1,859,411) 271,020
Long-Term Debt:
Unsecured Notes:
7% due 2000 50,000,000 50,000,000
7.22% due 1997 15,000,000 15,000,000
9.6% due 2001 20,000,000 20,000,000
10.56% due 2005 35,000,000 35,000,000
Various due dates 0 43,150,972 3,612,404 1,533,792
120,000,000 43,150,972 120,000,000 0 3,612,404 1,533,792
Less portion due within one year 800,000 800,000
Total Long-Term Debt 119,200,000 43,150,972 119,200,000 0 3,612,404 1,533,792
Total Capitalization $167,430,003 $60,436,234 $167,518,704 $12,764,219 $1,752,993 $1,804,812
(1) Authorized and outstanding, 1,000 shares
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
<CAPTION>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF CAPITALIZATION (continued)
DECEMBER 31, 1994
DECEMBER 31, 1994
EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $.01 par value
of Registrant (1) $ $ $ $ $
Other paid-in capital
Partners' capital 454,495 (777,412) (281,292) 2,484,391 4,140,551
Common share expense
Retained earnings
Total Common Equity 454,495 (777,412) (281,292) 2,484,391 4,140,551
Long-Term Debt:
Unsecured Notes:
7% due 2000
7.22% due 1997
9.6% due 2001
10.56% due 2005
Various due dates 14,161,889 13,202,737 130,887 3,294,059 7,215,204
14,161,889 13,202,737 130,887 3,294,059 7,215,204
Less portion due within one year
Total Long-Term Debt 14,161,889 13,202,737 130,887 3,294,059 7,215,204
Total Capitalization $14,616,384 $12,425,325 ($150,405) $5,778,450 $11,355,755
(1) Authorized and outstanding, 1,000 shares
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues $74,479,714 $4,767,837 $57,893,236 $2,966,935.00 $1,151,261 $2,167,080
Operating Expenses:
Operation $45,291,875 11,159,760 44,864,583 48,021 1,032,168 1,604,495
Maintenance 3,810,370 1,338,755 269 348,159 219,167
Depreciation and amortization 12,252,053 7,184,041 619,218 241,559 303,044
Taxes - Other than income 663,175 659,298 3,877
- Income (credit) (2,152,931) (2,079,373) (73,558)
- Deferred 3,024,786 2,137,588 887,198
Total Operating Expenses 62,889,328 11,159,760 54,104,892 1,485,025 1,621,886 2,126,706
Operating Income 11,590,386 (6,391,923) 3,788,344 1,481,910 (470,625) 40,374
Other Income and Deductions:
Interest and dividend income 4,693,777 4,867,987 9,544,347 1,788 0 17
Equity in earnings of jointly-
owned companies 0 1,233,328 1,233,328
Allowance for other funds used during
construction 0
Other (deductions) income - net (1,692,196) 2,595,487 871,156 32,135
Total Other Income 3,001,581 8,696,802 11,648,831 33,923 0 17
Income (Loss) Before Interest
Charges 14,591,967 2,304,879 15,437,175 1,515,833 (470,625) 40,391
Interest Charges:
Interest on long-term debt 10,199,004 10,199,004
Amortization of debt expense and
premium 151,537 151,537
Other interest expense (principally
short-term notes) 1,478,760 54,159 1,441,152 91,767
Allowance for borrowed funds used during
construction - (credit) (1,407,899) 882,816 (525,083)
Total Interest Charges 10,421,402 936,975 11,266,610 91,767 0 0
Net Income (Loss) before
preferred return 4,170,565 1,367,904 4,170,565 1,424,066 (470,625) 40,391
Preferred Return Requirement 0 1,699,688 31,763
Net Income (Loss) $4,170,565 ($331,784) $4,170,565 $1,424,066 ($470,625) $8,628
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENTS (continued)
FOR THE YEAR ENDED DECEMBER 31, 1994
EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
Operating Revenues $3,637,882 $6,609,453 $141,639 $1,512,022 $3,168,043
Operating Expenses:
Operation 2,039,269 5,595,363 94,684 416,276 756,776
Maintenance 328,431 1,140,844 39,353 109,813 285,579
Depreciation and amortization 1,265,293 1,259,426 29,002 345,936 1,004,534
Taxes - Other than income
- Income (credit)
- Deferred
Total Operating Expenses 3,632,993 7,995,633 163,039 872,025 2,046,889
Operating Income 4,889 (1,386,180) (21,400) 639,997 1,121,154
Other Income and Deductions:
Interest and dividend income 12,298 0 3,314
Equity in earnings of jointly-
owned companies
Allowance for other funds used during
construction
Other (deductions) income - net
Total Other Income 12,298 0 0 0 3,314
Income (Loss) Before Interest
Charge 17,187 (1,386,180) (21,400) 639,997 1,124,468
Interest Charges:
Interest on long-term debt
Amortization of debt expense and premium
Other interest expense (principally
short-term notes)
Allowance for borrowed funds used during
construction - (credit)
Total Interest Charges 0 0 0 0 0
Net Income (Loss) before
preferred return 17,187 (1,386,180) (21,400) 639,997 1,124,468
Preferred Return Requirement 639,112 0 400,739 628,074
Net Income (Loss) ($621,925) ($1,386,180) ($21,400) $239,258 $496,394
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income (Loss) $4,170,565 ($331,784) $4,170,565 $1,424,066 ($470,625) $8,628
Adjustments to Reconcile Net Income (Loss)
to Net Cash Provided by Operating Activities:
Depreciation and amortization 13,482,605 8,482,043 512,311 246,508 305,310
Deferred taxes 3,032,593 2,145,395 887,198
Gains on sales of investments in
energy savings projects paid for
with notes and leases receivable (5,473,617) (5,270,637) (58,238)
Equity earnings and preferred 0 1,890,426 190,738 31,763
Other - net (783,197) 775,419 4,046,144 (4,356,656) 52,885 50,096
Net Changes to Working Capital:
Accounts receivable (7,022,883) (1,681,282) (6,232,351) (1,111,575) 106,113 (240,001)
Materials and supplies (2,197,799) (30,309) (2,228,108) 0
Accounts payable (3,888,327) 4,249,544 (1,099,069) 2,641 252,343 991,182
Accrued taxes (865,881) (865,881)
Other - net 1,038,980 1,750,342 1,479,435 (1,402) 22,002 120,549
Net Cash Provided from (Used
in) Operating Activities 1,493,039 6,622,356 4,818,274 (2,643,417) 209,226 1,209,289
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures (16,224,859)(10,295,981) (24,177,784) (9,095) (924,653)
Collections on notes and leases
recceivable 12,750,123 (1) 11,733,421 305,820 2,409
Acquisition of Northeast
Energy Management, Inc. (8,567,456) 0 (8,567,456)
Acquisition of partnership
interest in Energy Capital
and Services I & II (2,485,940) (2,485,940)
Investments in subsidiaries 0 (4,878,666) (4,878,666)
Net Cash Provided from
(Used in) Financing Activities (14,528,132)(15,174,648) (19,808,969) (8,567,456) 296,725 (922,244)
CASH FLOW FROM FINANCING ACTIVITIES:
Issuances:
Common shares/capital contribution 0 8,552,292 0 11,503,150 (508,634) (224,607)
Long-term debt 0 0
Redemptions:
Long-term debt 0
Premium on reacquisition
and financing expenses (7,268) (7,268)
Net increase in short-term
debt 15,601,000 15,601,000
Net Cash Provided from
(Used in) Financing Activities 15,593,732 8,552,292 15,593,732 11,503,150 (508,634) (224,607)
NET (DECREASE) INCREASE IN CASH 2,558,639 603,037 292,277 (2,683) 62,438
Cash and temporary cash investments
at beginning of year 2,429,685 718,668 0 55,128 53
Cash and temporary cash investments
at end of year 4,988,324 $1,321,705 $292,277 $52,445 $62,491
Cash paid during the year for:
Interest (net of amounts capitalized) $9,006,063 $3,175,534 $8,968,455 37,608 $384,242 $103,652
Inccome Taxes $1,610,895 $1,600,895 10,000
Conversion of investments in energy
savings projects to notes and
leases receivable $10,913,526 $10,913,526
( ) Denotes contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
FOR THE YEAR ENDED DECEMBER 31, 1994
EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net Income (Loss) ($621,925) $0 ($21,400) $239,258 $496,394
Adjustments to Reconcile Net Income (Loss)
to Net Cash Provided by Operating Activities:
Depreciation and amortization 1,282,033 1,259,988 29,480 349,043 1,015,889
Deferred taxes
Gains on sales of investments in energy
savings projects paid for with notes
and leases receivable (144,742)
Equity earnings and preferred return 639,112 0 400,739 628,074
Other - net 187,452 12,916 0 1,856 (2,471)
Net Changes to Working Capital:
Accounts receivable 654,514 (198,718) (6,717) (215,035) (1,460,395)
Materials and supplies 0
Accounts payable (1,190,593) 1,350,736 26,834 (79,988) 107,131
Accrued taxes
Other - net 822,430 83,623 832 57,357 204,496
Net Cash Provided from (Used in)
Operating Activities 1,628,281 2,508,545 29,029 753,230 989,118
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures 3,208,797 (417,339) 0 (846,738) (3,354,028)
Collections on notes and
leases receivable 708,472 0 0 0
Acquisition of Northeast Energy
Management, Inc.
Acquisition of partnership interest in
Energy Capital and Services I & II
Investments in subsidiaries
Net Cash Provided from (Used
in) Financing Activities 3,917,269 (417,339) 0 (846,738) (3,354,028)
CASH FLOW FROM FINANCING ACTIVITIES:
Issuances:
Common shares/capital contribution (5,056,636) (608,333) (24,436) 259,818 3,211,970
Long-term debt
Redemptions:
Long-term debt
Premium on reacquisition and
financing expenses
Net increase in short-term debt
Net Cash Provided from (Used
in) Financing Activities (5,056,636) (608,333) (24,436) 259,818 3,211,970
NET (DECREASE) INCREASE IN CASH 488,914 1,482,873 4,593 166,310 847,060
Cash and temporary cash investments
at beginning of year 1,329,286 19,985 12,781 (17,137) 310,921
Cash and temporary cash investments
at end of year $1,818,200 $1,502,858 $17,374 $149,173 $1,157,981
Cash paid during the year for:
Interest(net of amounts capitalized) $1,301,944 $450,444 $15,029 $351,056 $569,167
Income Taxes
Conversion of investments in energy
savings projects to notes and leases receivable
( ) Denotes contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL
DECEMBER 31, 1994
<CAPTION>
Micro EUA
EUA EUA EUA Utility Highland
Cogenex Cogenex NEM Partners Energy
Consolidated Eliminations Corporation Inc of America Partners
<S> <C> <C> <C> <C> <C> <C>
Balance of retained earnings at $10,619,439 $6,405,227 $10,619,439 ($88,701.00) ($1,388,786) $275,696
beginning of the year
Additions:
Net Income (Loss) 4,170,565 (331,784) 4,170,565 1,424,066 (470,625) 8,628
Contributions 0 1,699,688 31,763
Adjustments 0 49,732
Total 14,790,004 7,822,863 14,790,004 1,335,365 (1,859,411) 316,087
Deductions:
Distributions 0 45,495 45,067
Other 88,699 2,083,957 88,699 74,296
Total Deductions 88,699 2,129,452 88,699 74,296 0 45,067
Balance of retained earnings at $14,701,305 $5,693,411 $14,701,305 $1,261,069 ($1,859,411) $271,020
end of period
Other Paid-In Capital at Beginning $28,650,811 $28,650,811
of the Year
Additions:
NEM acquisition $4,877,787 4,877,787
Other Paid-In Capital at End of Year $33,528,598 $33,528,598
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA COGENEX CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL (continued)
DECEMBER 31, 1994
EUA EUA EUA
EUA FRC II EUA Energy Energy
West Energy ICC Capital and Capital and
Coast Partners Partners Services I Services II
<S> <C> <C> <C> <C> <C>
Balance of retained earnings at
beginning of year $2,446,969 $608,768 ($259,892) $1,903,244 $2,907,929
Additions:
Net Income (Loss) (621,925) (1,386,180) (21,400) 239,258 496,394
Contributions 639,112 0 400,739 628,074
Adjustments (58,636) 108,368
Total 2,464,156 (777,412) (281,292) 2,484,605 4,140,765
Deductions:
Distributions 214 214
Other 2,009,661
Total Deductions 2,009,661 0 0 214 214
Balance of retained earnings at
earnings at end of period $454,495 ($777,412) ($281,292) $2,484,391 $4,140,551
Other Paid-In Capital at Beginning of Year
Additions:
NEM acquisition
Other Paid-In Capital at End of Year
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION> EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
ASSETS Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Non-utility plant and other investments:
Non-utility property $1,023,837 $1,023,837
Less accumulated provision for depreciation 112,187 112,187
------------ --------------- ------------ --------------- ------------
Net non-utility property 911,650 0 911,650 0
Investments in subsidiaries (at equity) 654,873 (519,047) (181,713) 317,539
Other investments & notes receivable 272,913 272,913
------------ --------------- ------------ --------------- ------------
Total Utility Plant and Other Investments 1,839,436 (519,047) (181,713) 1,184,563 317,539
------------ --------------- ------------ --------------- ------------
Current Assets:
Cash and temporary cash investments 502,816 13,661 489,155
Notes receivable 0 3,495,096 3,495,096
Accounts receivable - Net:
Others 1,084,538 580,744 503,338 456
Accounts receivable - associated companies 0 125,009 123,823 1,186
Other current assets 11,958 5,206 6,752
------------ --------------- ------------ --------------- ------------
Total Current Assets 1,599,312 3,620,105 4,218,530 999,245 1,642
------------ --------------- ------------ --------------- ------------
Deferred Debits:
Other deferred debits 8,595 8,595
------------ --------------- ------------ --------------- ------------
Total Deferred Debits 8,595 0 0 8,595 0
------------ --------------- ------------ --------------- ------------
Total assets $3,447,343 $3,101,058 $4,036,817 $2,192,403 $319,181
============ =============== ============ =============== ============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 1994
<CAPTION> EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
LIABILITIES Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Capitalization:
Common equity ($5,004,026) ($519,047) ($5,004,026) $1,321,249 ($1,840,296)
------------ --------------- ------------ --------------- ------------
Total Capitalization (5,004,026) (519,047) (5,004,026) 1,321,249 (1,840,296)
------------ --------------- ------------ --------------- ------------
Current Liabilites:
Notes Payable 8,747,830 3,495,096 8,692,757 1,305,073 2,245,096
Accounts payable 185,643 5,684 179,959
Accounts payable - associated companies 122,146 68,740 120,612 68,450 1,824
Interest accrued 880,799 56,269 880,799 35,579 20,690
Other current liabilities 154,018 154,018
------------ --------------- ------------ --------------- ------------
Total Current Liabilities 10,090,436 3,620,105 9,699,852 1,743,079 2,267,610
------------ --------------- ------------ --------------- ------------
Deferred Credits:
Minority Interest (Loss) (871,925) (871,925)
------------ --------------- ------------ --------------- ------------
Accumulated deferred taxes (767,142) (659,009) (108,133)
------------ --------------- ------------ --------------- ------------
Commitments and contingencies (Note J)
Total liabilities and capitalization $3,447,343 $3,101,058 $4,036,817 $2,192,403 $319,181
============ =============== ============ =============== ============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATING STATEMENTS OF CAPITALIZATION
DECEMBER 31, 1994
<CAPTION> EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Common Equity:
Common shares, $5 par value of registrant $1 $20 $1 $10 $10
Other paid-in capital 375,743 1,375,824 375,743 1,374,834 990
Common share expense 0
Retained earnings (5,379,770) (1,894,891) (5,379,770) (53,595) (1,841,296)
------------ --------------- ------------ --------------- ------------
Total Common Equity (5,004,026) (519,047) (5,004,026) 1,321,249 (1,840,296)
------------ --------------- ------------ --------------- ------------
Total Capitalization ($5,004,026) ($519,047) ($5,004,026) $1,321,249 ($1,840,296)
============ =============== ============ =============== ============
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATING INCOME STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION> EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Operating Expenses:
Operation $2,103,792 $1,552,919 $550,873
Maintenance 125 125
Depreciation and amortization 101,881 1,607 100,274
Taxes - Other than income 10,521 10,509 12
- Income 912 456 456
------------ --------------- ------------ --------------- ------------
Total Operating Expenses 2,217,231 0 1,565,616 651,159 456
------------ --------------- ------------ --------------- ------------
Operating (Loss) (2,217,231) 0 (1,565,616) (651,159) (456)
------------ --------------- ------------ --------------- ------------
Other Income and Deductions:
Interest and dividend income 21,368 35,579 35,579 21,368
Equity in earnings of jointly-owned companies 0 (53,891) (53,891)
Other income (deductions) - net 1,255,039 636,315 618,564 160
------------ --------------- ------------ --------------- ------------
Total Other Income 1,276,407 (18,312) 618,003 639,932 160
------------ --------------- ------------ --------------- ------------
(Loss) Before Interest Charges (940,824) (18,312) (947,613) (11,227) (296)
------------ --------------- ------------ --------------- ------------
Interest Charges:
Other interest expense (principally
short-term notes) 295,930 35,579 289,141 42,368 0
------------ --------------- ------------ --------------- ------------
Total Interest Charges 295,930 35,579 289,141 42,368 0
------------ --------------- ------------ --------------- ------------
(Loss) After Interest Charges (1,236,754) (53,891) (1,236,754) (53,595) (296)
------------ --------------- ------------ --------------- ------------
Net Loss ($1,236,754) ($53,891) ($1,236,754) ($53,595) ($296)
============ =============== ============ =============== ============
EUA Energy Common Shares outstanding 100
Earnings per share ($12,367.54)
============
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1994
<CAPTION>
EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Loss After Interest Charges ($1,236,754) ($53,891) ($1,236,754) ($53,595) ($296)
Adjustments to Reconcile Net Loss
to Net Cash Provided by Operating Activities:
Depreciation and Amortization 100,274 0 100,274
Other - Net (831,899) 1,038,856 6,138 215,854 (15,035)
Net Changes to Working Capital:
Accounts receivable (952,823) (101,765) (566,125) (503,338) 14,875
Notes receivable 0 (1,234,965) (1,234,965)
Accounts payable 237,228 66,186 54,549 248,409 456
Accrued taxes 0 0 0 0
Other - net 432,781 35,579 285,515 182,845 0
------------ --------------- ------------ --------------- ------------
Net Cash (Used in) Provided from
Operating Activities (2,251,193) (250,000) (2,691,642) 190,449 0
------------ --------------- ------------ --------------- ------------
CASH FLOW FROM INVESTING ACTIVITIES:
Construction expenditures (1,006,467) (1,006,467)
Increase in Other Investments (275,000) (1,000,100) (1,275,100)
------------ --------------- ------------ --------------- ------------
Net Cash Used in Investing Activities (1,281,467) (1,000,100) (1,275,100) (1,006,467) 0
------------ --------------- ------------ --------------- ------------
CASH FLOW FROM FINANCING ACTIVITIES:
Issuances:
Common shares/capital contributions 0 100 100
Net increase in short-term debt 4,033,903 1,250,000 3,978,830 1,305,073 0
------------ --------------- ------------ --------------- ------------
Net Cash Provided From Financing Activities 4,033,903 1,250,100 3,978,830 1,305,173 0
------------ --------------- ------------ --------------- ------------
NET INCREASE (DECREASE) IN CASH 501,243 0 12,088 489,155 0
Cash and temporary cash investments
at beginning of year 1,573 1,573 0 0
Cash and temporary cash investments ------------ --------------- ------------ --------------- ------------
at end of year $502,816 $0 $13,661 $489,155 $0
============ =============== ============ =============== ============
Cash paid during the year for:
Interest $0 $0 $0 $0 $0
Income Taxes(Refund) ($185,622) ($171,499) $456 ($14,579)
( ) Denotes Contra
The accompaning notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EUA ENERGY INVESTMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATING STATEMENTS OF RETAINED EARNINGS AND OTHER PAID-IN CAPITAL
DECEMBER 31, 1994
<CAPTION> EUA EUA
Energy Energy Eastern
Investment Investment EUA Unicord
Consolidated Eliminations Corporation Transcapacity Corporation
------------ --------------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Balance of retained earnings at begin. of year ($4,143,015) ($1,841,000) ($4,143,015) $0 ($1,841,000)
Additions:
Income (Loss) after interest charges (1,236,754) ($53,891) (1,236,754) (53,595) (296)
------------ --------------- ------------ --------------- ------------
Balance of retained earnings at end of year ($5,379,769) ($1,894,891) ($5,379,769) ($53,595) ($1,841,296)
============ =============== ============ =============== ============
( ) Denotes Contra
<FN>
The accompaning notes are an integral part of the financial statements.
</FN>
</TABLE>
Notes To Consolidated Financial Statements December 31, 1994
(A) Summary Of Significant Accounting Policies:
Basis of Consolidation: The consolidated financial statements include the
accounts of EUA and all subsidiaries. All material intercompany transactions
between the consolidated subsidiaries have been eliminated.
System of Accounts: The accounts of EUA and its consolidated subsidiaries are
maintained in accordance with the uniform system of accounts prescribed by the
regulatory bodies having jurisdiction.
Jointly Owned Companies: Montaup follows the equity method of accounting for
its stock ownership investments in jointly owned companies including four
regional nuclear generating companies. Montaup's investments in these nuclear
generating companies range from 2.25% to 4.50%. Montaup is entitled to
electricity produced from these facilities based on its ownership interests
and is billed for its entitlement pursuant to contractual agreements which are
approved by the Federal Energy Regulatory Commission (FERC). One of the four
facilities is being decommissioned, but Montaup is required to pay, and has
received FERC authorization to recover, its proportionate share of any
unrecovered costs and costs incurred after the plant's retirement.
Montaup's share of all unrecovered assets and the total estimated costs to
decommission the unit aggregated approximately $18.4 million at December 31,
1994 and is included with Other Liabilities on the Consolidated Balance Sheet.
Also, due to recoverability, a regulatory asset has been recorded for the same
amount and is included with Other Assets.
Montaup also has a stock ownership investment of 3.27% in each of two
companies which own and operate certain transmission facilities between the
Hydro Quebec electric system and New England.
EUA Ocean State follows the equity method of accounting for its 29.9%
partnership interest in the Ocean State Power Project (OSP). EUA Ocean
State's investment in OSP and Montaup's stock ownership investments are
included in"Investments in Jointly Owned Companies"on the Consolidated Balance
Sheet.
Plant and Depreciation: Utility plant is stated at original cost. The cost
of additions to utility plant includes contracted work, direct labor and
material, allocable overhead, allowance for funds used during construction and
indirect charges for engineering and supervision. For financial statement
purposes, depreciation is computed on the straight-line method based on
estimated useful lives of the various classes of property. On a consolidated
basis, provisions for depreciation on utility plant were equivalent to a
composite rate of approximately 3.3% in 1994 based on the average depreciable
property balances at the beginning and end of the year.
Non-utility property and equipment of EUA Cogenex is stated at original
cost. For financial statement purposes, depreciation on office furniture and
equipment and computer equipment is computed on the straight-line method based
on estimated useful lives ranging from five to fifteen years. Project
equipment is depreciated over the term of the applicable contracts or based on
the estimated useful lives, whichever is shorter, ranging from five to fifteen
years.
Electric Plant Held for Future Use: In January 1994 Montaup determined that
it would not be economically feasible to bring its 42-year-old, coal-fired,
Somerset Station Unit 5 generating unit into compliance with the Clean Air Act
Amendments of 1990 (Clean Air Act). The unit was placed in cold storage and
its net investment, $5.4 million, was transferred to electric plant held for
future use pending final determination by Montaup of its usefulness. Under
terms of the settlement agreement entered into by Montaup and the intervenors
in Montaup's 1994 rate decrease application and approved by FERC, Montaup
continues to earn a return on the net investment in the unit.
Other Assets: The components of Other Assets at December 31, 1994 are
detailed as follows:
(In Thousands) 1994
Regulatory Assets:
Unamortized losses on reacquired debt $ 17,709
Unrecovered plant and
decommissioning costs 18,400
Deferred SFAS 109 costs (Note B) 43,535
Deferred SFAS 106 costs (Note J) 4,941
Mendon Road judgment (Note J) 5,857
Other regulatory assets 9,505
Total regulatory assets 99,947
Other deferred charges and assets:
Unamortized debt expenses 6,197
Goodwill 7,260
Other 14,489
Total Other Assets $ 127,893
Allowance for Funds Used During Construction (AFUDC) and Capitalized Interest:
AFUDC represents the estimated cost of borrowed and equity funds used to
finance the EUA System's construction program. In accordance with regulatory
accounting, AFUDC is capitalized as a cost of utility plant in the same manner
as certain general and administrative costs. AFUDC is not an item of current
cash income but is recovered over the service life of utility plant in the
form of increased revenues collected as a result of higher depreciation
expense. The combined rate used in calculating AFUDC was 9.7% in 1994. The
caption Allowance for Borrowed Funds Used During Construction also includes
interest capitalized for non-regulated entities in accordance with Financial
Accounting Standards Board (FASB) Statement No. 34.
Operating Revenues: Utility revenues are based on billing rates authorized by
applicable federal and state regulatory commissions. Eastern Edison,
Blackstone and Newport (collectively, the Retail Subsidiaries) accrue the
estimated amount of unbilled base rate revenues at the end of each month to
match costs and revenues more closely. In addition they also record the
difference between fuel costs incurred and fuel costs billed. Montaup
recognizes revenues when billed. Montaup, Blackstone, and Newport also record
revenues related to rate adjustment mechanisms.
EUA Cogenex's revenues are recognized based on financial arrangements
established by each individual contract. Under paid from savings contracts,
revenues are recognized as energy savings are realized by customers. Revenue
from the sale of energy equipment is recognized when the sale is complete.
Revenue from sales-type lease contracts is recognized when savings to be
realized by customers are verified. Energy sales contracts revenue is
recognized as energy is provided to the customer. In circumstances in which
material uncertainties exist as to contract profitability, cost recovery
accounting is followed and revenues received under such contracts are first
accounted for as recovery of costs to the extent incurred.
Federal Income Taxes: EUA and its subsidiaries generally reflect in income
the estimated amount of taxes currently payable, and provide for deferred taxes
on certain items subject to temporary timing differences to the extent
permitted by the various regulatory agencies. EUA's rate-regulated
subsidiaries generally defer recognition of annual investment tax credits
(ITC) and amortize these credits over the productive lives of the related
assets.
Reclassifications: Certain prior period amounts on the financial statements
have been reclassified to conform with current presentation.
Cash and Temporary Cash Investments: EUA considers all highly liquid
investments and temporary cash investments with a maturity of three months or
less when acquired to be cash equivalents.
(B) Income Taxes:
EUA adopted FASB statement No. 109,"Accounting for Income Taxes"(FAS109)
which required recognition of deferred income taxes for temporary differences
that are reported in different years for financial reporting and tax purposes
using the liability method. Under the liability method, deferred tax
liabilities or assets are computed using the tax rates that will be in effect
when temporary differences reverse. Generally, for regulated companies, the
change in tax rates may not be immediately recognized in operating results
because of rate making treatment and provisions in the Tax Reform Act of 1986.
At December 31, 1994 no valuation allowance was deemed necessary for total
deferred tax assets. Total deferred tax assets and liabilities for 1994 are
comprised as follows:
Deferred Tax Deferred Tax
($ in thousands) Assets ($ in thousands) Liabilities
1994 1994
Plant Related Plant Related
Differences $19,072 Differences $164,130
Alternative Refinancing
Minimum Tax 9,446 Costs 2,196
Litigation 902 Pensions 1,769
Bad Debts 234
Pensions 1,907
Acquisitions 4,575
Other 5,127 Other 10,627
Total $41,263 Total $178,722
As of December 31, 1994 EUA has recorded on its Consolidated Balance
Sheet a regulatory liability to ratepayers of approximately $29.2 million.
This amount primarily represents excess deferred income taxes resulting from
the reduction in the federal income tax rate and also includes deferred taxes
provided on investment tax credits. Also at December 31, 1994 a regulatory
asset of approximately $43.5 million has been recorded, representing the
cumulative amount of federal income taxes on temporary depreciation
differences which were previously flowed through to ratepayers.
EUA has $9.4 million of alternative minimum tax credits which can be
utilized to reduce the consolidated regular tax liability and have no
expiration.
In 1994, EUA Ocean State utilized $3.9 million of investment tax credits
related to its investment in OSP, which were charged against 1994 federal
income tax expense and reduced the consolidated regular tax liability. EUA
has no remaining ITC carryforwards available.
Components of income tax expense for the year 1994 are as follows:
<TABLE>
NOTE B - INCOME TAXES:
<CAPTION>
Components of income and deferred tax expense for the year 1994 are as follows:
Blackstone Eastern EUA EUA
Eastern EUA Valley Newport Edison Cogenex Energy EUA
EUA Utilities Service Electric Electric Company Corporation Investment Ocean State
Consolidated Associates Corporation Company Corporation Consolidated Consolidated Consolidated Corporation
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Federal:
Current $6,651,083 $161 ($1,442,008 $1,435,767 $578,308 $9,143,201 ($1,704,839) $0 ($1,359,507
Deferred 9,199,665 (34) 1,092,084 175,785 579,442 4,697,303 2,655,866 0 (781)
Investment Tax Credit,
Net (99,226) 253,119 (3,960) (348,385)
15,751,522 127 (349,924) 1,864,671 1,153,790 13,492,119 951,027 0 (1,360,288)
State:
Current 1,153,639 99,408 20,296 10,064 1,467,968 (448,092) 912 3,083
Deferred 1,303,017 63,530 385 870,182 368,920
2,456,656 0 162,938 20,681 10,064 2,338,150 (79,172) 912 3,083
Charged to Operations -
Federal & State 18,208,178 127 (186,986) 1,885,352 1,163,854 15,830,269 871,855 912 (1,357,205)
Charged to Other Income
Current 8,577,939 2,956,896 45,574 28,675 616,838 2,222,601 (665,334) 3,372,689
Deferred (2,485,841)(2,716,267) (67,224) 0 297,650
Investment Tax Credit,
Net (3,972,314) 0 (82,200) (3,890,114)
Total $20,327,962 $240,756 ($186,986) $1,930,926 $1,110,329 $16,379,883 $3,094,456 ($664,422) ($1,576,980)
Federal income tax expense was different than the amounts computed by applying the statutory rates to book
income subject to tax for the following reasons:
Tax Computed at
Statutory Rates $24,509,975 ($349,500) $82,120 $1,980,469 $1,129,976 $17,416,965 $2,542,758 ($665,412) $2,372,599
(Decrease) Increase in Tax From:
Equity Component of
AFUDC (122,928) (13,493) (17,219) (92,216)
Depreciation of
Equity AFUD 49,622 4,204 260,406 94,911 (320,951) 11,052
Amortization and Utilization
of ITC (5,115,198) (193,866) (86,159) (945,059) (3,890,114)
Cost of Removal (403,800) (110,395) (67,751) (225,654)
Tax impact of EUA's
write-off of its
investment in EUA (3,401,837)(3,401,837)
State Tax, Net of Federal
Income Tax Benefit 2,285,239 105,910 13,443 6,542 1,614,079 542,669 592 2,004
Other 2,526,889 3,992,093 (379,220) (5,638) 50,029 (1,067,281) (2,023) 398 (61,469)
Total $20,327,962 $240,756 ($186,986) $1,930,926 $1,110,329 $16,379,883 $3,094,456 ($664,422) ($1,576,980)
</TABLE>
<TABLE>
NOTE B - INCOME TAXES (continued):
<CAPTION>
Components of income and deferred tax expense for the year 1994 are as follows:
Eastern Eastern Montaup
Edison Edison Electric
Consolidated Company Company
<S> <C> <C> <C>
0
Federal: 0
Current $9,143,201 $5,841,460 $3,301,741
Deferred 4,697,303 724,212 3,973,091
Investment Tax Credit, Net (348,385) (316,896) (31,489)
13,492,119 6,248,776 7,243,343
State:
Current 1,467,968 840,284 627,684
Deferred 870,182 (23,198) 893,380
2,338,150 817,086 1,521,064
Charged to Operations -
Federal & State 15,830,269 7,065,862 8,764,407
Charged to Other Income
Current 616,838 44,412 572,426
Deferred (67,224) 0 (67,224)
Investment Tax Credit, Net 0 0 0
Total $16,379,883 $7,110,274 $9,269,609
Federal income tax expense was different than the amounts computed by
applying the statutory rates to book income subject to tax for the
following reasons:
Tax Computed at Statutory Rates $17,416,965 $7,403,419 $10,013,546
(Decrease) Increase in Tax From:
Equity Component of AFUDC (92,216) (32,011) (60,205)
Depreciation of Equity AFUD (320,951) (88,221) (232,730)
Amortization and Utilization
of ITC (945,059) (316,895) (628,164)
Cost of Removal (225,654) (225,654)
State Tax, Net of Federal
Income Tax Benefit 1,614,079 536,153 1,077,926
Other (1,067,281) (166,517) (900,764)
Total $16,379,883 $7,110,274 $9,269,609
</TABLE>
<TABLE>
NOTE B - INCOME TAXES (continued):
<CAPTION>
Components of income and deferred tax expense for the year 1994 are as follows:
EUA Energy EUA EUA
Investment Energy EUA Unicord
Consolidated Corporation Transcapacity Corporation
<S> <C> <C> <C> <C>
Federal:
Current $0
Deferred 0
Investment Tax Credit, Net 0
0
State:
Current 912 456 456
Deferred 0
912 456 0 456
Charged to Operations -
Federal & State 912 456 0 456
Charged to Other Income
Current (665,334) (636,315) (28,859) (160)
Deferred 0
Investment Tax Credit, Net 0
Total ($664,422) ($635,859) ($28,859) $296
Federal income tax expense was different than the amounts computed by applying
the statutory rates to book income subject to tax for the following reasons:
Tax Computed at Statutory Rates ($665,412) ($636,553) ($28,859)
(Decrease) Increase in Tax From:
State Tax, Net of Federal 0
Income Tax Benefit 592 296 296
Other 398 398
Total ($664,422) ($635,859) ($28,859) $296
</TABLE>
NOTE B - INCOME TAXES (continued):
Components of income and deferred tax expense for the year 1994 are as follows:
EUA
Cogenex EUA Northeast
Corporation Cogenex Energy
Consolidated Corporation Management
Federal:
Current ($1,704,839) ($1,631,281) ($73,558)
Deferred 2,655,866 1,951,532 704,334
Investment Tax Credit, Net 0 0 0
951,027 320,251 630,776
State:
Current (448,092) (448,092) 0
Deferred 368,920 186,056 182,864
(79,172) (262,036) 182,864
Charged to Operations -
Federal & State 871,855 58,215 813,640
Charged to Other Income
Current 2,222,601 2,170,624 51,977
Deferred 0 0 0
Investment Tax Credit, Net 0 0 0
Total $3,094,456 $2,228,839 $865,617
Federal income tax expense was different than the amounts computed by
applying the statutory rates to book income subject to tax for the
following reasons:
Tax Computed at Statutory Rates $2,542,758 $1,741,367 $801,391
(Decrease) Increase in Tax From:
Equity Component of AFUDC 0 0 0
Depreciation of Equity AFUD 11,052 11,052 0
State Tax, Net of Federal
Income Tax Benefit 542,669 423,809 118,860
Other (2,023) 52,611 (54,634)
Total $3,094,456 $2,228,839 $865,617
C) Capital Stock:
The changes in the number of common shares outstanding and related
increases in Other Paid-In Capital for the year ended December 31, 1994 were
as follows:
Number of Common Shares Issued
Dividend Northeast Common Other
Reinvestment Energy Shares Paid-In
and Employee J.L. Day Co. Management At Par Capital
Savings Plans Acquisition Acquisition (000) (000)
1994 427,304 12,499 464,579 $ 4,522 $ 10,209
In the event of involuntary liquidation, the holders of non-redeemable
preferred stock of the Retail Subsidiaries are entitled to $100 per share plus
accrued dividends. In the event of voluntary liquidation, or if redeemed at
the option of these companies, each share of the non-redeemable preferred
stock is entitled to accrued dividends plus the following:
Company Issue Amount
Blackstone: 4.25% issue $104.40
5.60% issue 103.82
Newport: 3.75% issue 103.50
The preferred stock provisions of the Retail Subsidiaries place certain
restrictions upon the payment of dividends on common stock by each company. At
December 31, 1994 each company was in excess of the minimum requirements which
would make these restrictions effective.
(D) Redeemable Preferred Stock:
Eastern Edison's 6 5/8% Preferred Stock issue is entitled to mandatory
sinking funds sufficient to redeem 15,000 shares during each twelve-month
period commencing September 1, 2003. The redemption price is $100 per share
plus accrued dividends. All outstanding shares of the 6 5/8% issue are
subject to mandatory redemption on September 1, 2008 at a price of $100 per
share plus accrued dividends.
Newport's 9.75% Preferred Stock issue is entitled to a mandatory sinking
fund sufficient to redeem 500 shares during each twelve-month period until the
year 1999. The balance of any shares outstanding must be redeemed in the year
2000. The redemption price is $100 per share plus accrued dividends.
In the event of liquidation, the holders of Eastern Edison's 6 5/8%
Preferred Stock are entitled to $100 per share plus accrued dividends.
In the event of involuntary liquidation, the holders of Newport's
redeemable preferred stock are entitled to $100 per share plus accrued
dividends. In the event of voluntary liquidation, or if redeemed at the
option of Newport, the holders of the 9.75% issue are entitled to $102.44 per
share plus accrued dividends prior to October 1, 1998, thereafter no premium
is payable upon such redemption.
The aggregate amount of redeemable preferred stock sinking fund
requirements for each of the five years following 1994 are $50,000 per year
for 1995, 1996 and 1997, $40,000 for 1998 and zero for 1999.
(E) Long-Term Debt:
The various mortgage bond issues of Blackstone, Eastern Edison, and
Newport are collateralized by substantially all of their utility plant. In
addition, Eastern Edison's bonds are collateralized by securities of Montaup,
which are wholly-owned by Eastern Edison, in the principal amount of
approximately $246 million.
Blackstone's Variable Rate Demand Bonds are collateralized by an
irrevocable
letter of credit which expires on January 21, 1996. The letter of credit
permits an extension of one year upon mutual agreement of the bank and
Blackstone.
EUA Service 10.2% Secured Notes due 2008 are collateralized by certain
real estate and property of the company.
On January 6, 1994, Newport issued $7.9 million of variable rate Electric
Energy Facilities Revenue Refunding Bonds due 2011. The proceeds were used to
redeem Second Mortgage Bonds of Newport in amounts of $6.0 million at 12% and
$1.9 million at 8.5%. These bonds are collateralized by an irrevocable letter
of credit which expires on January 6, 1997. The letter of credit permits an
extension of one year upon mutual agreement of the bank and Newport.
The EUA System's aggregate amount of current cash sinking fund
requirements and maturities of long-term debt, (excluding amounts that may be
satisfied by available property additions) for each of the five years
following 1994 are: $41.6 million in 1995, $19.5 million in 1996, $27.5
million in 1997, $72.5 million in 1998 and $21.9 million in 1999.
(F) Fair Value of Financial Instruments:
The following methods and assumptions were used to estimate the fair
value of each class of financial instruments for which it is practicable to
estimate:
Cash and Temporary Cash Investments: The carrying amount approximates
fair value because of the short-term maturity of those instruments.
Long Term Notes Receivable and Net Investment in Sales-Type Leases: The
carry amounts approximately fair value due to the nature of the asset.
Preferred Stock and Long-Term Debt of Subsidiaries: The fair value of
the System's redeemable preferred stock and long-term debt were based on
quoted market prices for such securities at December 31, 1994.
Carrying Fair
Amount ($000) Value ($000)
EUA
Cash and Temporary Cash Investments $ 49 $ 49
Redeemable Preferred Stock - -
Long-Term Debt - -
EUA Service
Cash and Temporary Cash Investments 2,612 2,612
Redeemable Preferred Stock - -
Long-Term Debt 14,500 15,189
Blackstone
Cash and Temporary Cash Investments 472 472
Redeemable Preferred Stock - -
Long-Term Debt 39,500 40,468
Newport
Cash and Temporary Cash Investments 192 192
Redeemable Preferred Stock 190 190
Long-Term Debt 22,769 22,990
Eastern Edison-Consolidated
Cash and Temporary Cash Investments 11,265 11,265
Redeemable Preferred Stock 30,000 27,000
Long-Term Debt 265,000 244,238
EUA Cogenex- Consolidated
Carrying Fair
Amount Value
Cash and Temporary Cash Investments 4,988 4,988
Redeemable Preferred Stock - -
Long-Term Notes Receivable 38,269 38,269
(F) Fair Value of Financial Instruments - (continued)
EUA Cogenex- Consolidated - (continued)
Carrying Fair
Amount Value
Net Investment in Sales-Type Leases 911 911
Long-Term Debt 120,000 117,906
EUA Energy
Cash and Temporary Cash Investments 503 503
Redeemable Preferred Stock - -
Long-Term Debt - -
EUA Ocean State
Cash and Temporary Cash Investments 28 28
Redeemable Preferred Stock - -
Long-Term Debt 36,020 36,515
(G) Lines Of Credit:
EUA System companies maintain short-term lines of credit with various
banks aggregating approximately $150 million. At December 31, 1994, unused
short-term lines of credit were approximately $118 million. In accordance
with informal agreements with the various banks, commitment fees are required
to maintain certain lines of credit. During 1994 the weighted average
interest rate for short-term borrowings was 4.6%.
(H) Jointly Owned Facilities:
At December 31, 1994, in addition to the stock ownership interests
discussed in Note A, Summary of Significant Accounting Policies - Jointly
Owned Companies, Montaup and Newport had direct ownership interests in the
following electric generating facilities:
Accumulated
Provision For Net Construc-
Utility Depreciation Utility tion
Percent Plant in and Plant in Work in
($ in thousands) Owned Service Amortization Service Progress
Montaup:
Canal Unit 2 50.00% $ 67,031 $41,400 $25,631 $1,658
Wyman Unit 4 1.96% 4,017 1,908 2,109 22
Seabrook Unit 1 2.90% 203,772 19,458 184,314 664
Millstone Unit 3 4.01% 183,532 37,154 146,378 462
Newport:
Wyman Unit 4 0.67% 1,313 643 670 -
The foregoing amounts represent Montaup's and Newport's interest in each
facility, including nuclear fuel where appropriate, and are included on the
like-captioned lines on the Consolidated Balance Sheet. At December 31,
1994, Montaup's total net investment in nuclear fuel of the Seabrook and
Millstone Units amounted to $4.0 million and $1.9 million, respectively.
Montaup's and Newport's shares of related operating and maintenance expenses
with respect to units reflected in the table above are included in the
corresponding operating expenses.
(I) Financial Information By Business Segments:
The Core Electric Business includes results of the System's electric
utility operations of Blackstone, Eastern Edison, Newport and Montaup.
Energy Related Business includes results of our diversified energy related
subsidiaries, EUA Cogenex, EUA Ocean State and EUA Energy. Corporate results
include the operations of EUA Service and EUA Parent.
<TABLE>
<CAPTION>
Pre-Tax Depreciation Cash Equity in
Operating Operating Income and Construction Subsidiary
($ in thousands) Revenues Income Taxes Amortization Expenditures Earnings
<S> <C> <C> <C> <C> <C> <C>
Year Ended
December 31, 1994
Core Electric $ 489,798 $ 83,966 $ 18,879 $ 33,409 $ 32,978 $ 1,700
Energy Related 74,480 9,905 (484) 12,491 17,231 10,785
Corporate - (2,533) (187) 555 310 -
Total $ 564,278 $ 91,338 $ 18,208 $ 46,455 $ 50,519 $ 12,485
</TABLE>
December 31,
($ in thousands) 1994
Total Plant and Other Investments
Core Electric $ 721,840
Energy Related 217,584
Corporate 19,684
Total Plant and Other Investments 959,108
Other Assets
Core Electric 204,982
Energy Related 55,554
Corporate 14,405
Total Other Assets 274,941
Total Assets $ 1,234,049
(J) Commitments And Contingencies:
Nuclear Power Issues: Joint owners of nuclear projects are subject to the
risk that one of their number may be unable or unwilling to finance its share
of the project's costs, thus jeopardizing continuation of the project. On
February 28, 1991, EUA Power (now known as Great Bay Power Corporation), a
12.13% owner of the Seabrook nuclear project, filed for protection under
Chapter 11 of the Federal Bankruptcy Code. It conducted its business as a
debtor-in-possession until November 23, 1994, at which time its plan of
reorganization became effective and the company emerged from Chapter 11.
In addition to its 2.9% ownership interest in Seabrook Unit 1, Montaup
also has a 2.9% ownership interest in Seabrook Unit 2. On November 6, 1986,
the joint owners of Seabrook, recognizing that Seabrook Unit 2 had been
cancelled, voted to dispose of the Unit. Plans regarding disposition of
Seabrook Unit 2 are still under consideration, but have not been finalized and
approved. Montaup is unable, therefore, to estimate the costs for which it
would be responsible in connection with the disposition of Seabrook Unit 2.
Montaup must pay monthly charges with respect to Seabrook Unit 2 in order to
preserve and protect its components and various warranties. These costs are
currently being recovered in rates.
Nuclear Fuel Disposal and Nuclear Plant Decommissioning Costs: The Nuclear
Waste Policy Act of 1982 (NWPA) establishes that the federal government is
responsible for the disposal of spent nuclear fuel and obligates the
Department of Energy (DOE) to design, license, build and operate a permanent
repository for high level radioactive wastes and spent nuclear fuel. NWPA
specifies that DOE provide for the disposal of the waste and spent fuel
starting in 1998. DOE does not expect to achieve this date. As an interim
strategy, DOE is considering making available other federal government sites
to temporarily accommodate those firms that have depleted their own on-site
spent nuclear fuel storage capacity. The DOE anticipates that a permanent
disposal site for spent fuel will be ready to accept fuel for storage or
disposal on or before 2010. However, the NRC, which must license the site,
has stated only that a permanent repository will become available by the year
2025. Millstone Unit 3 management has indicated it has sufficient on-site
storage facilities to accommodate high level wastes and spent fuel for the
projected life of the unit. No significant expenditures are projected for the
foreseeable future. At Seabrook there is on-site storage capacity which, with
minimal capital expenditures, should be sufficient for twenty years, or to the
year 2010. No near-term capital expenditures are anticipated to accommodate
an increase in storage requirements after 2010. Montaup is required to pay a
fee based on its share of the generation from Millstone Unit 3 and Seabrook
Unit 1. Montaup is recovering these fees through its fuel adjustment clause.
Also, Montaup is recovering through rates its share of estimated
decommissioning costs for Millstone Unit 3 and Seabrook Unit 1. Montaup's
share of the current estimate of total costs to decommission Millstone Unit 3
is $18.0 million in 1994 dollars, and Seabrook Unit 1 is $11.5 million in 1994
dollars. These figures are based on studies performed for the lead owners of
the plants. Montaup also pays into decommissioning reserves pursuant to
contractual arrangements with other nuclear generating facilities in which it
has an equity ownership interest or life of the unit entitlement.
Such expenses are currently recoverable through rates.
Shareholder Proceeding: On January 20, 1995, EUA and a former shareholder of
EUA, which on February 11, 1992 had filed suit against EUA and three officers
of EUA in the Federal District Court of Massachusetts, filed a voluntary
dismissal of the suit with the court following the fulfillment of the terms of
a settlement agreement among EUA, the one officer remaining as a defendant in
the action and the former shareholder. The dismissal prevents the former
shareholder from suing EUA again on any claim asserted in the suit.
EUA and the officer continue to deny any and all allegations of wrongdoing
asserted by the former shareholder but determined it to be in their best
interests to settle the suit. Under the provisions of the Settlement
Agreement, its terms are to remain confidential. The Settlement Agreement
will not have an adverse impact on EUA's current earnings due to reserves that
EUA had previously established. In the suit the former shareholder alleged
fraudulent and negligent misrepresentations and violations of Rule 10b-5
under the Securities Exchange Act of 1934 in connection with statements made
regarding the business and prospects of EUA's former subsidiary, EUA Power,
and the portion of EUA's earnings attributable to AFUDC from EUA Power.
Pensions: The EUA System companies' retirement plans are non-contributory
defined benefit pension plans covering substantially all of their employees.
Regular plan benefits are based on years of service and average compensation
over the four years prior to retirement or in the case of the supplemental
retirement plan for certain officers of the EUA System, benefits are based on
compensation at retirement date. It is the EUA System's policy to fund the
regular plan on a current basis in amounts determined to meet the funding
standards established by the Employee Retirement Income Security Act of 1974.
Net pension expense (income) for the regular plan for 1994 included the
following components:
($ in thousands) 1994
Service cost-benefits earned
during the period $ 3,281
Interest cost on projected
benefit obligations 8,848
Actual loss (return) on assets 1,523
Net amortization and
deferrals (12,494)
Net periodic pension
expense (income) $ 1,158
Assumptions used to determine pension costs:
Discount Rate 7.25%
Compensation
Increase Rate 4.75%
Long-Term
Return on Assets 9.50%
The following table sets forth the actuarial present value of benefit
obligations and funded status at December 31, 1994.
($ in thousands) 1994
Accumulated benefit obligations
Vested $ 96,045
Non-vested 315
Total $ 96,360
Projected benefit obligations $(112,483)
Plan assets at fair value,
primarily stocks and bonds 122,816
Less: Unrecognized net gain
on assets (13,643)
Unamortized net
assets at January 1 5,365
Net pension assets $ 2,055
The discount rate used to determine pension costs changed effective
January 1, 1995 to 8.25% and was used to calculate the plans funded status at
December 31, 1994.
All benefits provided under the supplemental plan are unfunded and any
payments to plan participants are made by EUA. As of December 31, 1994
approximately $2.3 million was included in accrued expenses and other
liabilities for this plan. For the year ended December 31, 1994 expenses
related to the supplemental plan were $516,000.
Post-Retirement Benefits: Retired employees are entitled to participate in
health care and life insurance benefit plans. Health care benefits are
subject to deductibles and other limitations. Health care and life insurance
benefits are partially funded by EUA System companies for all qualified
employees.
The EUA System adopted FAS106,"Accounting for Post-Retirement Benefits
Other Than Pensions,"as of January 1, 1993. This standard establishes
accounting and reporting standards for such post-retirement benefits as
health care and life insurance. FAS106 further requires the accrual of the
cost of such benefits during an employee's years of service and the
recognition of the actuarially determined total post-retirement benefit
obligations (Transition Obligation) earned by existing employees and retirees.
EUA elected to recognize the Transition Obligation over a period of 20 years,
as permitted by FAS106. The resultant annual expense, including amortization
of the Transition Obligation and net of capitalized amounts, was approximately
$7.9 million and $8.1 million in 1994 and 1993, respectively. As a result of
December 1992 regulatory decisions, EUA's retail subsidiaries established
regulatory assets of approximately $1.6 million and $1.5 million in 1994 and
1993, respectively, due to the future recoverability of such amounts. Montaup
was allowed to defer FAS106-related expenses through 1995 or until it filed
for recovery of such amounts prior to that time. Accordingly approximately
$400,000 and $1.4 million of FAS106-related expenses were deferred by Montaup
in 1994 and 1993, respectively. Montaup requested and received authority to
recover all of its FAS106 expenses including a five-year amortization of
deferred amounts in its 1994 rate decrease application.
The total cost of post-retirement benefits other than pensions for 1994
include the following components:
($ in thousands) 1994
Service cost $ 1,537
Interest cost 5,381
Actual return on plan assets (126)
Amortization of transition obligation 3,429
Other amortizations & deferrals - net (85)
Total post-retirement benefit cost $10,136
Assumptions:
Discount rate 7.25%
Health care cost trend rate - near-term 13.00%
- long-term 5.00%
Salary increase rate 4.75%
Rate of return on plan assets - union 8.50%
- non-union 5.50%
Reconciliation of funded status:
($ in thousands) 1994
Accumulated post-retirement benefit obligation (APBO):
Retirees $(35,386)
Active employees fully eligible
for benefits (9,778)
Other active employees (23,306)
Total $(68,470)
Fair value of assets, primarily notes
and bonds 7,722
Unrecognized transition obligation 61,718
Unrecognized net loss (gain) (9,098)
(Accrued)/prepaid post-retirement
benefit cost $ (8,128)
The discount rate used to determine post-retirement benefit costs was
changed effective January 1, 1995 to 8.25% and was used to calculate the
funded status of Post-Retirement benefits at December 31, 1994.
Increasing the assumed health care cost trend rate by 1% each year would
increase the total post-retirement benefit cost for 1994 by $1.1 million and
increase the total accumulated post-retirement benefit obligation by $9.0
million.
The EUA System, has also established an irrevocable external Voluntary
Employee Benefit Association Trust Fund as required by the aforementioned
regulatory decisions. Contributions to the fund commenced in March 1993 and
totaled approximately $6.7 million during 1994.
Post-Employment Benefits: In November 1992, FASB issued Statement No.
112,"Employers' Accounting for Post-employment Benefits"for fiscal years
beginning after December 15, 1993. The impact of this standard on the EUA
System is immaterial to EUA's results of operations and therefore no liability
was recorded.
Long-Term Purchased Power Contracts: The EUA System is committed under
long-term purchased power contracts, expiring on various dates through
September 2021, to pay demand charges whether or not energy is received.
Under terms in effect at December 31, 1994, the aggregate annual minimum
commitments for such contracts are approximately $129 million in 1995 and
1996, $128 million in 1997, $132 million in 1998, $133 million in 1999 and
will aggregate $1.6 billion for the ensuing years. In addition, the EUA
System is required to pay additional amounts depending on the actual amount
of energy received under such contracts. The demand costs associated with
these contracts are reflected as Purchased Power-Demand on the Consolidated
Statement of Income. Such costs are recoverable through rates.
Environmental Matters: The Comprehensive Environmental Response,
Compensation Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, and certain similar state statutes authorize
various governmental authorities to seek court orders compelling responsible
parties to take cleanup action at disposal sites which have been determined by
such governmental authorities to present an imminent and substantial danger to
the public and to the environment because of an actual or threatened release
of hazardous substances. Because of the nature of the EUA System's business,
various by-products and substances are produced or handled which are
classified as hazardous under the rules and regulations promulgated by the EPA
as well as state and local authorities. The EUA System generally provides for
the disposal of such substances through licensed contractors, but these
statutory provisions generally impose potential joint and several
responsibility on the generators of the wastes for cleanup costs.
Subsidiaries of EUA have been notified with respect to a number of sites where
they may be responsible for such costs, including sites where they may have
joint and several liability with other responsible parties. It is the policy
of the EUA System companies to notify liability insurers and to initiate
claims. EUA is unable to predict whether liability, if any, will be assumed
by, or can be enforced against, the insurance carrier in these matters.
On December 13, 1994, the United States District Court for the District of
Massachusetts issued a judgment against Blackstone Valley Electric Company,
finding Blackstone liable to the Commonwealth of Massachusetts (the
Commonwealth) for the full amount of response costs incurred by the
Commonwealth in the cleanup of a coal gasification waste site at Mendon Road
in Attleboro, Massachusetts. The judgment also found Blackstone liable for
interest and litigation expenses calculated to the date of judgment. The
total liability is approximately $5.9 million, including approximately $3.6
million in interest which has accumulated since 1985.
Blackstone has filed a Notice of Appeal of the court's judgment and
filed its brief with the First Circuit Court of Appeals in February 1995.
Due to the uncertainty of the ultimate outcome of this proceeding and
anticipated recoverability, a deferred debit of $5.9 million was recorded and
is included with Other Assets.
On January 20, 1995, Blackstone entered into an escrow agreement with the
Commonwealth whereby Blackstone deposited $5.9 million with an escrow agent
who transferred the funds into an interest bearing money market account. The
distribution of the proceeds of the escrow account will be determined upon the
final resolution of the judgment. No additional interest expense will accrue
on the judgment amount.
On January 28, 1994, Blackstone filed a complaint in the United States
District Court for the District of Massachusetts, seeking, among other relief,
contribution and reimbursement from Stone & Webster, Inc. of New York, and
several of its affiliated companies (Stone & Webster) and Valley Gas Company
of Cumberland, Rhode Island (Valley) for any damages incurred by Blackstone
regarding the Mendon Road site. The court denied motions to dismiss the
complaint which were filed by Stone & Webster and Valley in 1994.
In addition, Blackstone notified certain liability insurers and has filed
claims with respect to the Mendon Road site, as well as other sites.
As of December 31, 1994, the EUA System had incurred costs of
approximately $3.5 million (excluding the $5.9 million Mendon Road judgment)
in connection with these sites, substantially all of which relate to
Blackstone. These amounts have been financed primarily by internally
generated cash. Blackstone is currently amortizing substantially all of its
incurred costs over a five-year period and is recovering certain of those
costs in rates.
EUA estimates that additional costs ranging from $2.6 million to $5.6
million (excluding the $5.9 million Mendon Road judgment) may be incurred at
these sites through 1996 by its subsidiaries and the other responsible
parties. Of this amount, approximately $4.8 million relates to sites at which
Blackstone is a potentially responsible party. Estimates beyond 1996 cannot
be made since site studies, which are the basis of these estimates, have not
been completed.
As a result of the recoverability of cleanup costs in rates and the
uncertainty regarding both its estimated liability, as well as its potential
contributions from insurance carriers and other responsible parties, EUA does
not believe that the ultimate impact of the environmental costs will be
material to the financial position of the EUA System or to any individual
subsidiary and thus no loss provision is required at this time.
The Clean Air Act created new regulatory programs and generally updated
and strengthened air pollution control laws. These amendments will expand the
regulatory role of the United States Environmental Protection Agency (EPA)
regarding emissions from electric generating facilities and a host of other
sources. EUA System generating facilities will most probably be first
affected in 1995, when EPA regulations will take effect for facilities owned
by the EUA System. Tests at Montaup's coal-fired Somerset Unit #6 indicated
it would be able to utilize lower sulfur coal than had been burned to meet the
1995 air standards with only a minimal capital investment. Montaup determined
that it would not be economical to repair Unit #5 of the Somerset Station and
therefore has placed it in deactivated reserve. EUA does not anticipate the
impact from the Amendments to be material to the financial position of the EUA
System.
In April 1992, the Northeast States for Coordinated Air Use Management
(NESCAUM), an environmental advisory group for eight Northeast states
including Massachusetts and Rhode Island, issued recommendations for nitrogen
oxide (NOx) controls for existing utility boilers required to meet the ozone
non-attainment requirements of the Clean Air Act. The NESCAUM recommendations
are more restrictive than the Clean Air Act requirements. The Massachusetts
Department of Environmental Management has amended its regulations to require
that Reasonably Available Control Technology (RACT) be implemented at all
stationary sources potentially emitting 50 tons or more per year of NOx.
Rhode Island has issued similar regulations also requiring that RACT be
implemented at all stationary sources potentially emitting 50 tons or more per
year of NOx. Montaup has initiated compliance, through, among other things,
selective noncatalytic reduction processes.
A number of scientific studies in the past several years have examined the
possibility of health effects from electric and magnetic fields (EMF) that are
found everywhere there is electricity. While some of the studies have
indicated there may be some association between exposure to EMF and health
effects, other studies have indicated no direct association. In addition, the
research to date has not conclusively established a direct causal relationship
between EMF exposure and human health. Additional studies, which are intended
to provide a better understanding of the subject, are continuing.
Some states have enacted regulations to limit the strength of magnetic
fields at the edge of transmission line rights-of-way. Rhode Island has
enacted a statute which authorizes and directs the Energy Facility Siting
Board to establish rules and regulations governing construction of high voltage
transmission lines of 69kv or more. There is a bill pending in the
Massachusetts Legislature that would authorize the Massachusetts Department of
Public Utilities to examine the potential health effects of EMF. Management
cannot predict the ultimate outcome of the EMF issue.
Guarantee of Financial Obligations: EUA has guaranteed or entered into equity
maintenance agreements in connection with certain obligations of its
subsidiaries. EUA has guaranteed the repayment of EUA Cogenex's $35 million
10.56% unsecured long-term notes due 2005 and EUA Ocean State's $36 million
9.59% unsecured long-term notes due 2011. In addition, EUA has entered into
equity maintenance agreements in connection with the issuance of EUA Service's
10.2% Secured Notes and EUA Cogenex's 7.22 % and 9.6% Unsecured Notes.
Under the December 1992 settlement agreement with EUA Power, EUA
reaffirmed its guarantee of up to $10 million of EUA Power's share of the
decommissioning costs of Seabrook Unit 1 and any costs of cancellation of Unit
1 or Unit 2. EUA guaranteed this obligation in 1990 in order to secure the
release to EUA Power of a $10 million fund established by EUA Power at the
time EUA Power acquired its Seabrook interest. EUA has not provided a reserve
for this guarantee because management believes that it is unlikely that EUA
will ever be required to honor the guarantee.
Montaup is a 3.27% equity participant in two companies which own and
operate transmission facilities interconnecting New England and the Hydro
Quebec system in Canada. Montaup has guaranteed approximately $5.6 million
of the outstanding debt of these two companies. In addition, Montaup and
Newport have minimum rental commitments which total approximately $14.2
million and $1.8 million, respectively under a noncancellable transmission
facilities support agreement for years subsequent to 1994.
Other: In December 1992, Montaup commenced a declaratory judgment action in
which it sought to have the Massachusetts Superior Court determine its rights
under the Power Purchase Agreement between it and Aquidneck Power Limited
Partnership (Aquidneck). Montaup sought a declaration that the Power Purchase
Agreement was binding on the parties according to its terms. Aquidneck
asserted that Montaup had either an express or implied obligation to negotiate
new terms and conditions to the Power Purchase Agreement. Specifically, the
defendants sought to amend, through negotiations, certain milestone events to
which they were bound in the Power Purchase Agreement as written. Aquidneck
failed to meet the first milestone of January 1, 1993.
Accordingly, on January 5, 1993, Montaup exercised its rights to terminate
the Power Purchase Agreement effective immediately.
In January 1994 a counterclaim by Aquidneck claimed certain breaches of
the Power Purchase Agreement, including an alleged failure on the part of
Montaup to renegotiate the terms and conditions of the Power Purchase
Agreement relating to the first milestone event. Also in January 1994,
Aquidneck sought to join EUA and EUA Service as parties to the suit.
Aquidneck apparently claims $11 million of damages on the theory that EUA
can"avoid an approximately $11 million obligation to purchase capacity and
power
which it does not currently need." Aquidneck seeks treble damages claiming
Montaup, EUA and EUA Service violated state laws willfully and knowingly.
The Court has scheduled a hearing in April 1995 on Montaup's motion for
default judgment based on Aquidneck's failure to meet its discovery
obligations. In addition, Montaup intends to file a motion for summary
judgment.
Montaup, EUA and EUA Service intend to defend the counterclaim vigorously
and believe that Aquidneck's claims have no basis in law.
Exhibit D
EASTERN UTILITIES ASSOCIATES AND
AFFILIATED CORPORATIONS
Federal Income Tax Allocation Agreement
Pursuant to Rule 45(c). Public Utility Holding
Company Act of 1935 and I.R.C. Regulation Section
1.1552-1(A) (1) and Section 1.1502-33(d) (2) (ii)
This agreement made as of April 30, 1995, among Eastern
Utilities Associates (the designation of the trustees for
the time being under a Declaration of Trust dated April 2,
1928, as amended) (EUA); Eastern Edison Company, a
Massachusetts corporation (Eastern); Blackstone Valley
Electric Company, a Rhode Island corporation (Blackstone);
Newport Electric Corporation, a Rhode Island corporation
(Newport); Montaup Electric Company, a Massachusetts
corporation (Montaup); EUA Service Corporation, a
Massachusetts corporation (EUA Service); EUA Cogenex
Corporation, a Massachusetts corporation (Cogenex); EUA
Energy Investment Corporation, a Massachusetts corporation
(EUA Energy); EUA Ocean State Corporation, a Rhode Island
corporation (Ocean State); Eastern Unicord Corporation, a
Massachusetts corporation (Unicord); Northeast Energy
Management, Inc., a Massachusetts corporation (NEM); EUA
Transcapacity, Inc., a Massachusetts corporation
(Transcapacity); and EUA Cogenex-Canada, Inc., a Canadian
corporation (Cogenex-Canada).
W I T N E S S E T H T H A T :
WHEREAS, the term "AFFILIATES" as used herein shall be
deemed to refer to Eastern, Blackstone, Newport, Montaup,
EUA Service, Cogenex, EUA Energy, Ocean State, Unicord, NEM,
Transcapacity and EUA Cogenex-Canada, the AFFILIATES
together with EUA, and the CONSOLIDATED AFFILIATES as a
collective taxpaying unit is sometimes referred to as the
"GROUP" and
WHEREAS, EUA owns directly or indirectly at least 80
percent of the issued and outstanding shares of each class
of voting common stock of each of the AFFILIATES; each of
the CONSOLIDATED AFFILIATES is a member of an affiliated
group within the meaning of Section 1504 of the Internal
Revenue Code of 1954, as mended (the "Code"), of which EUA
is the common parent; and the GROUP presently participates
in the filing of a consolidated income tax return.
Definitions
A. Corporate Tax Benefit - The amount by which the
consolidated tax is reduced by including a net corporate tax
loss or other net tax benefit in the consolidated return.
The value of the benefit of the operating loss shall be
determined by applying the then current corporate income tax
rate to the amount of the loss. The value of a credit is
the actual tax savings (100%). The value of capital losses
used to offset capital gains shall be computed at the then
current tax rate applicable to capital gains for
corporations. The value of any corporate tax benefit to be
reimbursed to a member shall be reduced by the amount of any
alternate minimum tax attributable to such member.
B. Separate Return Tax - The tax on the corporate
taxable income of an associate company computed as though
such company were not a member of the consolidated group.
C. Excess Tax Credits - The investment tax credit,
alternate minimum tax credit, research and development
credit, energy tax credit or other similar credit that would
be allowable in the consolidation (were it not for a
limitation provided by law) in excess of the amount of such
credits which could be utilized on a separate return basis
with regard to such limitations.
EUA and the AFFILIATES agree as follows:
Allocation Procedures in Accordance with I.R.C Regulation
Sections 1.1552-1(A) (I) and 1.1502-33(d) (2) (ii)
A. General Rule
Step 1 - The consolidated tax liability shall be
apportioned among the companies in the ratio that each
member's separate taxable income bears to the sum of the
separate taxable incomes of all members having taxable
income.
Step 2 - An additional amount will be allocated to the
members at 100% of the excess of the member's separate tax
liability over the consolidated tax liability allocated to
the member under Step 1. Under no circumstances shall the
tax allocated to a member exceed its separate tax liability.
Step 3 - The total of the amounts allocated under Step
2 is credited to those members who had "corporate tax
benefits" as follows:
(a) Those members having a negative allocation under
Step 2;
(b) If the total of the "corporate tax benefits" is
greater than the total reduction in the consolidated tax,
then the benefits arising from the inclusion of negative
taxable incomes in the consolidated return shall be
recognized and paid prior to the benefits arising from
excess tax credits.
(c) If the total benefits attributable to the negative
taxable incomes of the members are not absorbed in the
consolidated return, the benefit allocated to each company
shall be in proportion to their respective negative taxable
incomes.
(d) If the total benefits attributable to the excess
tax credits are not applied in the consolidated return, the
benefit allocated to each company shall be in proportion to
their respective excess tax credits.
Step 4 - If the total consolidated tax liability shall
result in an "Alternative Minimum Tax" liability position
then an additional amount will be added to Steps 1 and 2.
This additional amount will be allocated to the members
based upon their proportionate amounts of alternate minimum
taxable income until such time as the proposed amendments to
the income tax regulations under Sections 53 to 59, 1502 and
1552 of the Internal Revenue Code become effective.
Subsequent to the effective date of the new regulations, the
alternate minimum tax liability will be allocated in
accordance with the approved regulations provided that such
regulations prohibit the use of the net positive alternate
minimum taxable income allocation method.
Step 5 - Reimbursement - Benefiting members will
reimburse the others no later than 90 days after the filing
of the consolidated tax return.
B. Unused Corporate Tax Benefits
A member that is entitled to payment for a tax benefit,
but does not receive such payment because of the rules in
Step 3 shall retain such right for the future to the extent
that such benefit can be applied against the consolidated
tax liability. Uncompensated corporate tax benefits arising
from negative taxable income shall have priority over the
benefits attributable to excess tax credits.
C. Tax Adjustments
In the event of any adjustments to the tax returns of
any of the CONSOLIDATED AFFILIATES filed (by reason of an
amended return, a claim for refund or an audit by the
Internal Revenue Service), the liability, if any, of each of
the AFFILIATES under Section A shall be redetermined to give
effect to any such adjustment as if it had been made as part
of the original computation of tax liability, and payments
between EUA and the appropriate AFFILIATES shall be made
within 120 days after any such payments are made or refunds
are received, or, in the case of contested proceedings,
within 120 days after a final determination of the contest.
Interest and penalties, if any, attributable to such an
adjustment shall be paid by each AFFILIATE to EUA in
proportion to the increase in such AFFILIATE's separate
return tax liability computed under Section A of this
Agreement that is required to be paid to EUA. In any
situation in which the Group's tax liability is adjusted by
a revenue agent's report or a court settlement and an item-by-item
modification is not made, the Group shall consult its accountants
for assistance in determining a fair allocation of the adjusted
liability.
D. Subsidiaries of Affiliates
If at any time, any of the AFFILIATES acquires or
creates one or more subsidiary corporations that are
includible corporations of the Group, they shall be subject
to this Agreement and all references to the AFFILIATES
herein shall be interpreted to include such subsidiaries as
a group.
E. Successors
This Agreement shall be binding on and insure to the
benefit of any successor, by merger, acquisition of assets
or otherwise, to any of the parties hereto (including but
not limited to any successor of EUA or any of the AFFILIATES
succeeding to the tax attributes of such corporation under
Section 381 of the Code) to the same extent as if such
successor had been an original party to this agreement.
F. Special Rule
In making the tax allocations provided for in this
agreement, notwithstanding any of the foregoing, no
corporate tax benefits shall be allocated to EUA. Although
the separate corporate taxable income or taxable loss of EUA
and any tax credits attributable to EUA will be included in
the consolidated return, only the tax savings attributable
to such items shall be allocated to the other AFFILIATES as
if EUA were not a member of the Group. In making this
allocation, the tax savings of EUA shall be allocated only
to members of the Group having taxable income.
Also, in making the tax allocations, only those tax
consequences attributable to non-affiliated transactions
shall be allocated to EUA Service Corporation in accordance
with Section A of this Agreement. All others will be
allocated to the other AFFILIATES as if EUA Service
Corporation were not a member of the Group.
G. Termination Clause
This Agreement shall apply to the taxable year ending
December 31, 1995, unless all of the members of the Group
agree in writing to terminate the Agreement prior to the end
of the taxable year. The Agreement shall be renewable on a
year to year basis for subsequent taxable years, provided
all of the members of the Group agree in writing, prior to
the end of the immediately preceding taxable year, to extend
the Agreement one additional year. Notwithstanding any
termination, this Agreement shall continue in effect with
respect to any payment or refunds due for all taxable
periods prior to termination.
IN WITNESS WHEREOF, the duly authorized representatives
of the parties have set their hands this 30th day of April,
1995.
EASTERN UTILITIES ASSOCIATES
By
Title: Chairman of the Board
EASTERN EDISON COMPANY EUA COGENEX CORPORATION
By By
Title: President Title: President
BLACKSTONE VALLEY ELECTRIC COMPANY EUA ENERGY INVESTMENT
CORPORATION
By By
Title: President Title: Vice President
MONTAUP ELECTRIC COMPANY EUA OCEAN STATE CORPORATION
By By
Title: Vice President Title: Treasurer
EUA SERVICE CORPORATION EUA UNICORD CORPORATION
By By
Title: President Title: Clerk
NEWPORT ELECTRIC COMPANY NORTHEAST ENERGY
MANAGEMENT, INC.
By By
Title: President Title: Vice
President
EUA COGENEX-CANADA, INC.
By
Title: Assistant Treasurer
EUA TRANSCAPACITY, INC.
By
Title: Vice President
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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