<PAGE> 1
FILE NO. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
DECLARATION UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
MAINE YANKEE ATOMIC POWER COMPANY
321 Old Ferry Road
WISCASSET, MAINE 04578
----------------------
(Name and principal executive office of
company filing this statement)
NATIONAL GRID USA
NATIONAL GRID GROUP PLC
NORTHEAST UTILITIES
(Name of top registered holding companies)
William M. Finn, Esq. Michael E. Thomas
Secretary Chief Financial Officer
Maine Yankee Atomic Power Company Maine Yankee Atomic Power Company
83 Edison Drive 321 Old Ferry Road
Augusta, Maine 04330 Wiscasset, Maine 04578
The Commission is requested to send copies of all notices, orders and
communications in connection with this declaration to:
Hemmie Chang, Esq.
Ropes & Gray
One International Place
Boston, Massachusetts 02110
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ITEM 1. DESCRIPTION OF PROPOSED TRANSACTIONS
A. SUMMARY OF PROPOSED TRANSACTIONS
Maine Yankee Atomic Power Company ("Maine Yankee" or the "Company")
proposes to redeem PRO RATA from its stockholders all but 5,000 shares of its
presently outstanding Common Stock (99% of its outstanding Common Stock will be
redeemed), on the condition that certain requirements set forth in Section 8 of
the Company's Articles of Incorporation are satisfied prior to each such
redemption. The Company intends to accomplish this repurchase in one or more
steps over the next eight years, with all such redemptions completed by October
31, 2008. The redemption price per share of Common Stock for each such
redemption shall be equal to the amount obtained by dividing (1) the sum of the
aggregate par value of the Common Stock then outstanding plus the capital
surplus, including without limitation other paid-in capital (less any deficit in
earned surplus) immediately prior to such redemption by (2) the number of shares
of Common Stock outstanding immediately prior to such redemption. As of March
31, 2000, the sum determined in accordance with clause (1) is $66,218,585 and
the number of shares determined in accordance with clause (2) is 500,000, so
that the redemption price would be $132.437 per share. After all redemptions are
completed, the Company will maintain minimal equity until it ultimately prepares
to liquidate and wrap up its affairs.
B. DESCRIPTION OF MAINE YANKEE ATOMIC POWER COMPANY
Maine Yankee, a Maine corporation incorporated on January 3, 1966, is an
indirect subsidiary of National Grid USA, National Grid Group Plc and Northeast
Utilities, which are registered holding companies under the Public Utility
Holding Company Act of 1935 (the "Act"). Maine Yankee operated a pressurized
water nuclear-powered electric generating plant in Wiscasset, Maine (the
"Plant") from 1972 to 1997, when the Plant was permanently removed from service.
The Plant is currently being dismantled and decommissioned. The U.S. Nuclear
Regulatory Commission (the "NRC") regulates the ongoing decommissioning and
spent fuel storage activities at the Plant.
The nine sponsoring utilities own the entire common capital stock of Maine
Yankee in the percentages shown in the table below. The sponsoring utilities
have each entered into Power Contracts with Maine Yankee dated May 20, 1968, as
amended, Additional Power Contracts with Maine Yankee dated February 1, 1984,
and 1997 Amendatory Agreements with Maine Yankee dated August 6, 1997
(collectively, the "Power Contracts", see Exhibit A-1 hereto) that entitle and
obligate them to purchase the output of the Plant in the same percentages.
<TABLE>
<CAPTION>
Sponsoring Company Holding Company Percentage of Stock & POWER
------------------ --------------- ---------------------------
<S> <C> <C>
Central Maine Power Co. Not Applicable(1) 38.0%
</TABLE>
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(1) Energy East Corporation, a New York corporation and public utility holding
company exempt from all provisions of the Act except Section 9(a)(2), has filed
an Application/Declaration on Form U-1 (File No. 70-09569) seeking approval to
acquire all of the issued and outstanding shares of, among others, CMP Group,
Inc., a Maine corporation and similarly exempt public utility holding company
which owns all of the issued and outstanding common stock of Central Maine Power
Company. Upon completion of that merger Central Maine Power Company would become
an indirect subsidiary of Energy East Corporation, which would then be a
registered holding company under the Act.
<PAGE> 3
<TABLE>
<S> <C> <C>
New England Power Co. National Grid USA 24.0%
National Grid Group Plc
The Conn. Lt. & Pwr Co. Northeast Utilities 12.0%
Bangor Hydro-Electric Company Not Applicable 7.0%
Maine Public Service Company Not Applicable 5.0%
Public Service Co. of NH Northeast Utilities 5.0%
Cambridge Elect. Lt. Co. BECo - NSTAR 4.0%
Western Mass. Elec. Co. Northeast Utilities 3.0%
Central Vt. Public Service Corp. Not Applicable 2.0%
-----
100.0%
=====
</TABLE>
C. BACKGROUND
As of March 31, 2000, Maine Yankee's current capital (including Other
Paid-In Capital, Capital Stock Expense, Gain on Cancellation of Preferred Stock
and Retained Earnings) consists of $88,969,000 of total equity: $73,969,000 of
equity evidenced by 500,000 shares of Common Stock, $100 par value per share,
which are held by the nine sponsoring companies in the proportions indicated
above; and 150,000 shares of 8.00% Redeemable Preferred Stock, $100 par value
per share (see Exhibit J-1).
As a single purpose utility corporation, Maine Yankee's economic life was
primarily keyed to the operating licensed life (October 21, 2008) of its Plant.
When the Plant ceased operation, the Company no longer had any electric revenue
producing business and its primary activity since 1997 has been overseeing the
decommissioning of the Plant. As a single purpose utility corporation, the
Company has anticipated many corporate end of life issues. These issues required
advanced financial planning to ensure that all costs associated to the Company's
activities are paid for by the sponsoring utilities of the Company for the
electrical energy output produced over its life and that all assets are properly
accounted for and depreciated. Such proper financial planning will allow an
orderly winding-up of the Company's business to be accomplished concurrently
with the decommissioning of the Plant. The major future cash requirements which
are not yet fully funded are the decommissioning of the Plant, including interim
storage of spent fuel. Maine Yankee is currently collecting decommissioning
funds through its Power Contracts and Amendatory Agreements under the Federal
Energy Regulatory Commission ("FERC") regulation. These contracts have been
filed with the FERC. As a result of a FERC Order in Docket ER98-570 dated June
1, 1999, Maine Yankee has agreed to file with the FERC no later than January 1,
2004 for the purpose of examining any further rate adjustments specifically,
although not limited to the future cost of spent fuel storage management. Maine
Yankee expects that case to determine any adjustments to decommissioning
collections.
<PAGE> 4
In addition, there are balance sheet adjustments which must be made so that
all assets are appropriately characterized consistent with rate recovery. The
original Plant, including major capital additions and all tangible assets of the
Company, are being amortized as regulatory assets as authorized by FERC over the
original operating licensed life of the Plant. The recovery of all investments
and assets have been approved by FERC in docket ER98-570 and are anticipated to
be recovered in cost of service rates by October 31, 2008. In the event
additional cost of service (operating and expense and decommissioning funding)
requirements are needed at any future period, the Power Contracts impose a
non-cancelable obligation on the sponsoring utilities to pay such cost of
service expenses.
Because no additional capital funds are required to amortize any of these
assets or to fund any of those remaining end of life obligations, Maine Yankee
believes that appropriate steps should be taken to significantly reduce the
Company's outstanding equity contemporaneously with its write-down of its
assets.
The Company's capital structure as of March 31, 2000 was as follows:
<TABLE>
<CAPTION>
Component ($000) % of Total
--------- ------ ----------
<S> <C> <C>
Term Loan(2) $48,000 35.05%
Preferred Equity(3) $15,000 10.95%
Common Equity $73,969 54.00%
-------- -----
Total $136,969 100%
======== =====
</TABLE>
ITEM 2. FEES, COMMISSIONS AND EXPENSES.
Estimated expenses of Maine Yankee in connection with the repurchase of
stock are shown on Exhibit H-1.
ITEM 3. APPLICABLE STATUTORY PROVISIONS.
Maine Yankee is an indirect subsidiary of National Grid USA, National Grid
Group Plc and Northeast Utilities, each of which is a registered holding
company. The acquisition of the Company's common stock from its stockholders is
therefore subject to the provisions of Section 12(c) of the Act and of Rules 42
and 46 thereunder.
----------------------
(2) The Term Loan will be retired with mandatory payments of $2,400,000 on the
last business day of each calendar quarter commencing June 30, 2001, and ending
March 31, 2006, subject to any adjustments resulting from any mandatory or
optional prepayments that may have been made by Maine Yankee prior to March 31,
2006, under the terms of the controlling loan agreement.
(3) The Preferred Equity, consisting of 150,000 shares of cumulative preferred
stock, $100 par value, will be retired through the operation of mandatory and
optional sinking funds. The provisions of the mandatory sinking fund require the
redemption of 21,500 shares of the preferred stock on October 1 of each year,
commencing in 2002 and ending in 2008. The optional sinking fund permits the
redemption of an additional 21,500 shares at the option of Maine Yankee on each
mandatory sinking fund date.
<PAGE> 5
ITEM 4. REGULATORY APPROVAL.
No other state commission or any Federal Commission, other than the
Securities and Exchange Commission, has jurisdiction over the proposed
transactions.
ITEM 5. PROCEDURE.
Maine Yankee does not request a hearing on this Declaration and requests
that the Commission issue its order as soon as practicable after the filing
hereof, and further requests that such order specify, in accordance with Rule
24(c)(1), that the redemption described herein may be carried out in one or more
transactions prior to October 31, 2008.
Without prejudice to its right to modify the same if a hearing should be
ordered on this Declaration, Maine Yankee hereby makes the following
specifications required by paragraph (B) of Item 5 of Form U-1;
1. There should not be a recommended decision by a hearing officer or any
other responsible officer of the Commission.
2. The Division of Corporate Regulation may assist in the preparation of
the Commission's decision.
3. There should not be a 30-day waiting period between issuance of the
Commission's order and the date on which it is to become effective.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS.
(a) EXHIBITS Filed herewith:
A-1 Composite Form of Power Contracts dated May 20, 1968, as amended,
Additional Power Contracts dated February 1, 1984, and 1997 Amendatory
Agreements dated August 6, 1997
A-2 Maine Yankee Articles of Incorporation
B-1 Long-Term Projections through October 31, 2008
F-1 Opinion of Company counsel as to matters required by Instruction F-1
to Exhibits to Form U-1
H-1 Maine Yankee's Estimated Fees and Expenses
I-1 Proposed Form of Notice
(b) FINANCIAL STATEMENTS
J-1 Balance Sheets of Maine Yankee as of March 31, 2000 and December 31,
1999.
J-2 Statements of Income of Maine Yankee for the Twelve-Months Ended March
31, 2000 and December 31, 1999.
Financial Statements of the top registered holding companies, National Grid
USA, National Grid Group Plc and Northeast Utilities, have been omitted as
not being necessary to a consideration of this application.
ITEM 7. INFORMATION AS TO ENVIRONMENTAL EFFECTS.
<PAGE> 6
The proposed transactions do not involve a major Federal action
significantly affecting the quality of the human environment.
<PAGE> 7
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the undersigned company has duly caused this Declaration to be signed on
its behalf by the undersigned thereunto duly authorized.
MAINE YANKEE ATOMIC POWER COMPANY
By: /s/ Michael E. Thomas
----------------------------------------
Michael E. Thomas, Vice President and
Chief Financial Officer
June 30, 2000
<PAGE> 8
EXHIBIT A-1
COMPOSITE FORM OF POWER CONTRACTS DATED MAY 20,
1968, AS AMENDED, ADDITIONAL POWER CONTRACTS
DATED FEBRUARY 1, 1984, AND 1997 AMENDATORY
AGREEMENTS DATED AUGUST 6, 1997
<PAGE> 9
Attachment A
[COMPOSITE CONFORMED COPY]
[as amended as of January 1, 1984
as of March 1, 1984
and as of October 1, 1984]
POWER CONTRACT, dated as of May 20, 1968, between MAINE YANKEE ATOMIC POWER
COMPANY ("Maine Yankee"), a Maine corporation, and (The names of the Purchasers
appear in the attached Appendix) (the "Purchaser").
It is agreed as follows:
1. BASIC UNDERSTANDINGS.
Maine Yankee has been organized to provide for the supply of power to its
eleven sponsoring utility companies (including the Purchaser). Late in 1966 and
early in 1967, it entered into contracts for the manufacture of the major
components and the services of an architect-engineer for the construction of a
nuclear electric generating unit of the pressurized water type, designed to have
a capability of approximately 800 megawatts electric as a site on tidewater in
the Town of Wiscasset, Maine (such unit being herein, together with the site
and all related facilities to be owned by Maine Yankee, referred to as the
"Unit"). Construction of the Unit is now being carried out under contracts with
Combustion Engineering, Inc. and Westinghouse Electric Corporation for certain
major systems of equipment and Stone and Webster Engineering Corporation as
Architect-Engineer.
The Unit is to be operated to supply power to each of the eleven
sponsoring utilities (the "sponsors"), each of which has contemporaneously
agreed to purchase a stated percentage of the capacity and output of the Unit
and a like percentage of Maine Yankee's stock. The names of the sponsors and
their respective percentages ("entitlement percentages") of the capacity and
output of the Unit are as follows:
Entitlement
Sponsor Percentage
------- -----------
Central Maine Power Company............................... 38.0%
New England Power Company................................. 20.0%
The Connecticut Light and Power Company................... 8.0%
Bangor Hydro-Electric Company............................. 7.0%
Maine Public Service Company.............................. 5.0%
Public Service Company of New Hampshire................... 5.0%
Cambridge Electric Light Company.......................... 4.0%
Montaup Electric Company.................................. 4.0%
The Hartford Electric Light Company....................... 4.0%
Western Massachusetts Electric Company.................... 3.0%
Central Vermont Public Service Corporation................ 2.0%
Maine Yankee and its other sponsors are entering into power contracts
which are identical to this contract except for necessary changes in the names
of the parties.
2. EFFECTIVE DATE AND TERM.
This contract shall become effective upon receipt by the Purchaser of
notice that Maine Yankee has entered into power contracts, as contemplated by
Section 1 above, with each of its other sponsors. The term of this contract
shall expire 30 years after the plant completion date.
The "plant completion date" shall be the earlier of (i) December 31, 1973,
or (ii) the date on which the Unit is placed in commercial operation, as
determined by Maine Yankee (the "commercial operation date").
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3. CONSTRUCTION OF THE UNIT.
Maine Yankee will proceed with due diligence with construction of the
Unit, and will exercise its best efforts to complete and place it in commercial
operation by May 1, 1972, within present cost estimates, and will keep the
Purchaser reasonably informed as to the progress of construction, material
modifications in cost estimates, and expected plant completion date.
4. OPERATION AND MAINTENANCE OF THE UNIT.
Maine Yankee will operate and maintain the Unit in accordance with good
utility practice under the circumstances and all applicable law, including the
applicable provisions of the Atomic Energy Act of 1954, as amended, and of any
licenses issued thereunder to Maine Yankee. Within the limits imposed by good
utility practice under the circumstances and applicable law, the Unit will be
operated at its maximum capability and on a long hour use basis.
Outages for inspection, maintenance, refueling and repairs and
replacements will be scheduled in accordance with good utility practice and
insofar as practicable shall be mutually agreed upon by Maine Yankee and the
Purchaser. In the event of an outage, Maine Yankee will use its best efforts to
restore the Unit to service as promptly as practicable.
5. PURCHASER'S ENTITLEMENT.
The Purchaser will, throughout the term of this contract, be entitled and
obligated to take its entitlement percentage of the capacity and net electrical
output of the Unit, at whatever level the Unit is operated or operable, whether
more or less than 800 megawatts electric.
6. DELIVERIES AND METERING.
The Purchaser's entitlement percentage of the output of the Unit will be
delivered to and accepted by it at the step-up substation at the site. All
deliveries will be made in the form of 3-phase, 60 cycle, alternating current
at a nominal voltage of 345,000 volts. The Purchaser will make its own
arrangements for the transmission of its entitlement percentage of the output
of the Unit.
Maine Yankee will supply and maintain all necessary metering equipment for
determining the quantity and conditions of supply of deliveries under this
contract, will make appropriate tests of such equipment in accordance with good
utility practice and as reasonably requested by the Purchaser, and will
maintain the accuracy of such equipment within reasonable limits. Maine Yankee
will furnish the Purchaser with such summaries of meter readings as the
Purchaser may reasonably request.
7. PAYMENT.
With respect to each month commencing prior to the plant completion date,
the Purchaser will pay Maine Yankee at the rate of 3.75 mills per kilowatt
hour, for the Purchaser's entitlement percentage of the net electrical output
(if any) of the Unit during the particular month.
With respect to each month commencing on or after the plant completion
date or, in the case of payments under clause (b) below, commencing on or after
the date authorized by The Federal Energy Regulatory Commission ("FERC"),
formerly the Federal Power Commission, the Purchaser will pay Maine Yankee an
amount equal to the Purchaser's entitlement percentage of the sum of (a) Maine
Yankee's total fuel costs for the month with respect to the Unit, plus (b) the
Total Decommissioning Costs for the month with respect to the Unit, plus (c)
Maine Yankee's total operating expenses for the month with respect to the Unit,
plus (d) an amount equal to one-twelfth of the composite percentage for such
month of the net Unit investment as most recently determined in accordance with
this Section 7.
"Composite percentage" shall be computed as of the plant completion date
and as of the last day of each month thereafter (the "computation date") and
for any month the composite percentage shall be that computed as of the last
day of the previous month. "Composite percentage" as of a computation date
shall be the sum of (i) nine and eight-tenths percent (9.8%) or such higher
percentage as the Federal
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<PAGE> 11
Energy Regulatory Commission (the "Commission") from time to time may allow but
not more than twenty percent (20%), multiplied by the percentage which equity
investment with respect to the Unit (other than equity investment for the
financing of fuel inventory, including nuclear materials and the cost of
fabrication thereof, for the Unit) as of such date is of the total capital as of
such date; plus (ii) the "effective interest rate" per annum of each principal
amount of indebtedness outstanding on such date for money borrowed with respect
to the Unit (other than for money borrowed for the financing of fuel inventory,
including nuclear materials and the cost of fabrication thereof, for the Unit),
multiplied by the percentage which such principal amount is of total capital as
of such date. The "effective interest rate" of each principal amount of
indebtedness referred to in clause (ii) of the next preceding sentence will
reflect the annual interest requirements and to the extent applicable,
amortization of issue expenses, discounts and premiums, sinking fund call
premiums, expenses and discounts, refunding and retirement expenses, discounts
and premiums, and all other expenses applicable to the issue.
"Equity investment" as of any date shall consist of the sum of (i) all
amounts theretofore paid to Maine Yankee for all capital stock theretofore
issued, plus all capital contributions, less the sum of any amounts paid by
Maine Yankee in the form of stock retirements, repurchases or redemptions or
return of capital; plus (ii) any credit balance in the capital surplus account
not included under (i) and in earned surplus account on the books of Maine
Yankee as of such date.
"Total capital" as of any date shall be the equity investment with respect
to the Unit, plus the total of all other securities and indebtedness then
outstanding with respect to the Unit other than equity investment, securities,
indebtedness and other obligations issued in connection with the financing or
leasing of fuel inventory, including nuclear materials and the cost of
fabrication thereof, for the Unit.
"Uniform System" shall mean the Uniform System of Accounts prescribed by
the Federal Power Commission for Class A and Class B Public Utilities and
Licensees as in effect on the date of this contract and as said System may be
hereafter amended to take account of private ownership of special unclear
material.
Maine Yankee's "fuel costs" for any month shall include (i) amounts
chargeable in accordance with the Uniform System in such month as amortization
of costs of fuel assemblies and components and burn-up of nuclear materials for
the Unit; plus (ii) all other amounts properly chargeable in accordance with the
Uniform System to fuel costs for the Unit less any applicable credits thereto;
plus (iii) one-twelfth of nine and eight-tenths percent (9.8%) or such higher
percentage as the Commission from time to time may allow, but not more than
twenty percent (20%), multiplied by the equity investment for the financing of
fuel inventory, including nuclear materials and the cost of fabrication thereof,
for the Unit; plus (iv) to the extent not provided for in any of the foregoing,
all payments (or accruals therefor or a amortization thereof) with respect to
obligations incurred in connection with the financing or leasing of fuel
inventory, including nuclear materials and the cost of fabrication thereof, for
the Unit.
Maine Yankee's "operating expenses" shall include all amounts properly
chargeable to operating expense accounts (other than such amounts which are
included in Maine Yankee's fuel costs) less any applicable credits thereto, in
accordance with the Uniform System; provided, however, that for purposes of
this contract, the accrual of depreciation and amortization of the Unit as an
operating expense shall commence on the plant completion date, The amount of
depreciation and amortization for each period shall be at a rate at least
sufficient to fully amortize the then non-salvable plant investment balance in
equal amounts over the periods remaining until May 1, 2002.
The "net Unit investments" shall consist in each case with respect to the
Unit, of the net sum of (i) the aggregate amount properly chargeable at the
time in accordance with the Uniform System to Maine Yankee's electric plant
accounts (including construction work in progress); plus (ii) the amount of any
unamortized property losses; less (iii) the amount of any reserves for
depreciation and for amortization of property losses; plus (iv) such allowances
for inventories, materials and supplies (other than fuel assemblies and
components), prepaid items and cash working capital as may reasonably be
determined from time to time by Maine Yankee.
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<PAGE> 12
The net Unit investment shall be determined as of the plant completion
date and thereafter as of the commencement of each calendar year, or, if Maine
Yankee elects, at more frequent intervals.
"Total Decommissioning Costs" for any month shall mean the sum of (x) an
amount equal to all accruals in such month to any reserve, as from time to time
established by Maine Yankee and approved by its board of directors, to provide
for the ultimate payment of the Decommissioning Expenses of the Unit plus (y)
Decommissioning Tax Liability for such month. It is understood (i) that such
funds may be held by Maine Yankee or, if required, by an independent trust or
other separate fund, as determined by said board of directors, (ii) that, upon
compliance with Section 21, hereof, the amount, custody and/or timing of such
accruals may from time to time during the term hereof be modified by said
board of directors in its discretion or to comply with applicable statutory or
regulatory requirements or to reflect changes in the amount, custody or timing
of anticipated Decommissioning Expenses, and (iii) that the use of the term "to
decommission" herein encompasses compliance with all requirements (other than
those relating to spent nuclear fuel) of the Nuclear Regulatory Commission or
its successors (NRC) for permanent cessation of operation of nuclear facility.
"Decommissioning Expenses" shall include:
(1) All costs and expenses of removing the Unit from service,
including without limitation, dismantling, mothballing, removing
radioactive material (excluding spent nuclear fuel) to temporary and/or
permanent storage sites, decontaminating, restoring and supervising the
site, and any costs and expenses incurred in connection with proceedings
before governmental regulatory authorities relating to any authorization to
decommission the Unit or remove the Unit from service;
(2) All costs of labor and services, whether directly or indirectly
incurred, including without limitation services of foremen, inspectors,
supervisors, surveyors, engineers, security personnel, counsel and
accountants, performed or rendered in connection with the decommissioning
of the Unit and the removal of the Unit from service, and all costs of
materials, supplies, machinery, construction equipment or apparatus hired)
for or in connection with the decommissioning of the Unit and the removal
of the Unit from service, and all administrative costs, including services
of counsel and financial advisers, of any applicable independent trust or
other separate fund; it being understood that any amount, exclusive of
proceeds of insurance, realized by Maine Yankee as salvage on any
machinery, construction equipment and apparatus, the cost of which was
charged to Decommissioning Expense, shall be treated as a reduction of the
amounts otherwise chargeable on account of the costs of decommissioning of
the Unit; and
(3) All overhead costs applicable to the Unit during its
decommissioning period, including, without limiting the generality of the
foregoing, taxes (other than taxes on or in respect of income), licenses,
excises and assessments, casualties, surety bond premiums and insurance
premiums.
"Decommissioning Tax Liability" for any month shall be an amount
established by Maine Yankee and approved by its board of directors to meet
possible income tax obligations, which amount shall not exceed: the amount to
be included in the clause (x) portion of Total Decommissioning Costs for such
month multiplied by a fraction whose numerator is equal to the combined highest
statutory Federal and state marginal income tax rate and whose denominator is
equal to one minus the combined highest statutory Federal and state marginal
income tax rate. Maine Yankee will use its best efforts to obtain as promptly
as possible favorable tax treatment of the payments for Total Decommissioning
Costs hereunder so that Decommissioning Tax Liability may be minimized.
Without limiting the generality of the foregoing, amounts expended or to
be paid with respect to decommissioning of the Unit or removal of the Unit from
service shall constitute part of the Decommissioning Expenses if they are, or
when paid will be, either (i) properly changeable to any account related to
decommissioning of a nuclear generating unit in accordance with the Uniform
System or generally accepted accounting principles as then in effect, or (ii)
properly changeable to decommissioning of a nuclear generating unit in
accordance with then applicable regulations of the NRC or FERC or any other
regulatory agency having jurisdiction.
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<PAGE> 13
Maine Yankee will bill the Purchaser, as soon as practicable after the end
of each month, for all amounts payable by the Purchaser with respect to the
particular month. Such bills will be rendered in such detail as the Purchaser
may reasonably request and may be rendered on an estimated basis subject to
corrective adjustments in subsequent billing periods. All bills shall be due
and payable when rendered.
When all or any part of any bill shall remain unpaid for more than thirty
(30) days after the rendering thereof, simple interest at an annual rate which
is 2% in excess of the current prime rate then in effect at The First National
Bank of Boston shall accrue to Maine Yankee from and after the due date to the
date payment is received and shall be payable to Maine Yankee on either (i)
such unpaid amount, or (ii) in the event the amount of the bill is disputed,
the amount finally determined to be due and payable.
Notwithstanding any other provision of this Contract, the treatment of (1)
construction work in progress ("CWIP"), (2) nuclear fuel in process ("NFIP"),
and (3) accumulated deferred income taxes ("ADIT") for purposes of any
calculations relevant to the computation of monthly payments under this Section
7 shall conform to the Federal Energy Regulatory Commission's regulations
respecting such items, as such regulations may be modified from time to time.
7A. DECOMMISSIONING FUND.
Maine Yankee agrees to pay to, or cause to be paid to, the Maine Yankee
Trust or any successor trust approved by the board of directors of Maine Yankee
all funds collected hereunder for the express purpose of decommissioning the
Unit or removing the Unit from service and further agrees that, after the tax
consequences of decommissioning collections have been resolved, any funds
collected hereunder to meet Decommissioning Tax Liability which are not used
for that purpose will be refunded to Purchaser to the extent required by FERC.
8. MAKE-UP TERM AND OPTION TERM.
(a) The Purchaser may elect to extend the contract term by written notice
to Maine Yankee upon the following conditions and for the following period or
periods:
(i) in the event that the Unit is not in commercial operations on the
plant completion date, the contract term may be extended for a period equal
to the number of consecutive days by which commercial operation is delayed
beyond the plant completion date; and
(ii) if at any time after the commencement of commercial operation no
deliveries are made under this contract for a period of at least 120
consecutive days, the contract may be extended for a period equal to the
aggregate of such periods during which no deliveries were made.
If the term of the contract is extended pursuant to the provisions of this
subsection (a), all of the contract provisions shall remain in effect for the
extended term.
(b) Upon expiration of the initial term of this contract or upon
expiration of the term as extended in accordance with subsection (a) of this
Section 8, the Purchaser shall continue to be entitled, at its option, to its
entitlement percentage of the capacity and output of the Unit upon terms at
least as favorable as those obtained by any other person.
9. CANCELLATION OF CONTRACT.
If deliveries cannot be made to the Purchaser because either
(i) the Unit is damaged to the extent of being completely or
substantially completely destroyed, or
(ii) the Unit is taken by exercise of the right of eminent domain or a
similar right or power, or
(iii) (a) the Unit cannot be used because of contamination, or because
a necessary license or other necessary public authorization cannot be
obtained or is revoked, or because the utilization of such a license or
authorization is made subject to specified conditions which are met, and
(b) the situation cannot be rectified to an extent which will permit Maine
Yankee to make deliveries to the Purchaser from the Unit:
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<PAGE> 14
then and in any such case, the Purchaser may cancel the provisions of this
contract, except that in all cases other than those described in clause (ii)
above, the provisions relating to the payment of Total Decommissioning Costs
shall, whether or not the Unit is operated or operable and notwithstanding any
earlier termination of the service life of the Unit, remain in full force and
effect until January 1, 2003 or the completion of decommissioning, whichever
is earlier. Such cancellation shall be effected by written notice given by the
Purchaser to Maine Yankee. In the event of such cancellation, all continuing
obligations of the parties (other than the obligation relating to the payment
and application of Total Decommissioning Costs to the extent that such
obligations remain in full force and effect pursuant to the second preceding
sentence, but including the Purchaser's obligations to continue payments
pursuant to clauses (a), (c) and (d)of the second paragraph of Section 7
hereof) shall cease forthwith. Any dispute as the Purchaser's right to cancel
this contract pursuant to the foregoing provisions shall be referred to
arbitration in accordance with the provisions of Section 12.
Notwithstanding anything in this contract elsewhere contained, the
Purchaser may cancel this contract or be relieved of its obligations to make
payments hereunder only as provided in the next preceding paragraph of this
Section 9. Further, if for reasons beyond Maine Yankee's reasonable control,
deliveries are not made as contemplated by this contract, Maine Yankee shall
have no liability to the Purchaser on account of such non-delivery.
10. INSURANCE.
Prior to the first shipment of fuel to the plant site, Maine Yankee will
obtain, and thereafter will at all times maintain insurance to cover its
"public liability" for personal injury and property damage resulting from a
"nuclear incident" (as those terms are defined in the Atomic Energy Act of 1954
as amended), with limits not less than Maine Yankee may be required to maintain
to qualify for governmental indemnity under said Act and shall execute and
maintain an indemnification agreement with the Atomic Energy Commission as
provided by said Act. Maine Yankee will also at all times maintain such other
types of liability insurance, including workmen's compensation insurance, in
such amounts, as is customary in the case of other similar electric utility
companies, or as may be required by law.
Maine Yankee will at all times keep insured such portions of the Unit
(other than the fuel assemblies and components, including nuclear materials) as
are of a character usually insured by electric utility companies similarly
situated and operating like properties, against the risk of a "nuclear incident"
and such other risks as electric utility companies, similarly situated and
operating like properties, usually insure against; and such insurance shall to
the extent available be carried in amounts sufficient to prevent Maine Yankee
from becoming a co-insurer. Maine Yankee will at all times keep its fuel
assemblies and components (including nuclear materials) insured against such
risks and in such amounts as shall, in the opinion of Maine Yankee, provide
adequate protection.
11. ADDITIONAL UNITS.
Maine Yankee or its nominees may install one or more additional generating
units at the Wiscasset site. The installation of such unit or units shall not
affect the terms of this contract, but in such case if any portion of the Unit
(whether such portion constitutes land, structures or equipment) is also used
with an additional unit or units, an appropriate allocation of the cost of the
Unit shall be made and the net Unit investment shall be reduced accordingly,
subject, however, to the limitation that the aggregate amount of the reduction
in net Unit investment resulting from all such allocations shall not exceed
$5,000,000. Maine Yankee may make any other necessary allocations or any
necessary adjustments in its accounts with respect to the Unit (including fuel
assemblies and components) and any additional unit or units, and such
allocations and adjustments shall be binding on the sponsors.
12. AUDIT.
Vermont Yankee's books and records (including metering records) shall be
open to reasonable inspection and audit by the Purchaser.
24
<PAGE> 15
13. ARBITRATION.
In case any dispute shall arise as to the interpretation or performance of
this contract which cannot be settled by mutual agreement and which may be
finally determined by arbitration under the law of the State of Maine then in
effect, such dispute shall be submitted to arbitration, and arbitration of such
dispute shall be a condition precedent to any action at law or suit in equity
that can be brought. The parties shall if possible agree upon a single
arbitrator. In case of failure to agree upon an arbitrator within 15 days after
the delivery by either party to the other of a written notice requesting
arbitration, either party may request the American Arbitration Association to
appoint the arbitrator. The arbitrator, after opportunity for each of the
parties to be heard, shall consider and decide the dispute and notify the
parties in writing of his decision. The expenses of the arbitration shall be
borne equally by them.
14. REGULATION.
This contract, and all rights, obligations and performance of the parties
hereunder, are subject to all applicable state and federal law and to all duly
promulgated orders and other duly authorized action of governmental authority
having jurisdiction in the premises.
15. ASSIGNMENT.
This contract shall be binding upon and shall inure to the benefit of, and
may be performed by, the successors and assigns of the parties, except that no
assignment, pledge or other transfer of this contract by either party shall
operate to release the assignor, pledgor or transferor from any of its
obligations under this contract unless consent to the release is given in
writing by the other party, or, if the other party has theretofore assigned,
pledged or otherwise transferred its interest in this contract, by the other
party's assignee, pledgee or transferee, or unless such transfer is incident to
a merger or consolidation with, or transfer of all or substantially all of the
assets of the transferor to, another sponsor which shall, as a part of such
succession, assume all the obligations of the transferor under this contract.
16. RIGHT OF SETOFF.
The Purchaser shall not be entitled to set off against the payments
required to be made by it under this contract (i) any amounts owed to it by
Maine Yankee or (ii) the amount of any claim by it against Maine Yankee.
However, the foregoing shall not affect in any other way the Purchaser's rights
and remedies with respect to any such amounts owned to it by Maine Yankee or any
such claim by it against Maine Yankee.
17. INTERPRETATION.
The interpretation and performance of this contract shall be in accordance
with and controlled by the law of the State of Maine.
18. ADDRESSES.
Except as the parties may otherwise agree, any notice, request, bill or
other communication from one party to the other, relating to this contract, or
the rights, obligations or performance of the parties hereunder, shall be in
writing and shall be effective upon delivery to the other party. Any such
communication shall be considered as duly delivered when delivered in person or
upon the lapse of 48 hours from mailing by registered or certified mail, postage
prepaid, to the post office address of the other party shown following the
signature of such party hereto, or such other address as may be designated by
written notice given as provided in this Section 18.
19. CORPORATE OBLIGATIONS.
This contract is the corporate act and obligation of the parties hereto,
and any claim hereunder against any stockholder (other than the Purchaser),
director or officer of either party, as such, is expressly waived.
25
<PAGE> 16
This contract represents the entire agreement between us relating to the
subject matter hereof, and all previous agreements, discussions, communications
and correspondence with respect to the subject matter are hereby superseded and
are of no further force and effect.
21. Amendments.
Upon authorization by Maine Yankee's board of directors of uniform
amendments to all the sponsor power contracts, Maine Yankee shall have the
right to amend the provisions of Section 7 hereof insofar as they relate to the
amounts collectible by Maine Yankee pursuant to clause (b) of the second
paragraph of Section 7 hereof or to the timing of such collections by serving
an appropriate statement of such amendment upon the Purchaser and filing the
same with FERC (or such other regulatory agency as may have jurisdiction in the
premises) in accordance with the provisions of applicable laws and any rules
and regulations thereunder, and the amendment shall thereupon become effective
on the date specified therein, subject to any suspension order duly issued by
such agency. All other amendments to this contract shall be by mutual
agreement, evidenced by a written amendment signed by the parties hereto.
IN WITNESS WHEREOF, the parties have executed this contract by their
respective officers thereunto duly authorized as of the date first above
written.
MAINE YANKEE ATOMIC POWER COMPANY
By WILLIAM H. DUNHAM
President
9 Green Street
Augusta, Maine 04330
By_________________________________
(Officer and Title)
(Address)
___________________________________
___________________________________
26
<PAGE> 17
APPENDIX
Separate Power Contracts were entered into, identical in form with the
foregoing except as to the execution thereof and except that on page 1 the
names of the respective Purchasers were inserted.
The Power Contract were executed by the respective parties thereto, as
follows:
MAINE YANKEE ATOMIC POWER COMPANY PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
By W.H. DUNHAM By W.C. TALLMAN
President President
9 Green Street 108 Elm Street
Augusta, Maine 04330 Manchester, New Hampshire 03105
CENTRAL MAINE POWER COMPANY CAMBRIDGE ELECTRIC LIGHT COMPANY
By S. GIDDINGS By JOHN F. RICH
Executive Vice President President
9 Green Street 130 Austin Street
Augusta, Maine Cambridge, Mass. 02139
NEW ENGLAND POWER COMPANY MONTAUP ELECTRIC COMPANY
By ROBERT F. KRAUSE By GUIDO R. PERERA
President President
441 Stuart Street P.O. Box 2333
Boston, Massachusetts Boston, Massachusetts 02107
THE CONNECTICUT LIGHT AND POWER THE HARTFORD ELECTRIC LIGHT
COMPANY COMPANY
By SHERMAN R. KNAPP By C.L. DERRICK
Chairman Chairman
P.O. Box 2010 P.O. Box 2370
Hartford, Connecticut 06101 Hartford, Connecticut 06101
BANGOR HYDRO-ELECTRIC COMPANY WESTERN MASSACHUSETTS ELECTRIC COMPANY
By R.N. HASKELL By ROBERT E. BARRETT, JR.
President President
33 State Street 174 Brush Hill Avenue
Bangor, Maine 04401 West Springfield, Mass. 01089
CENTRAL VERMONT PUBLIC SERVICE
MAINE PUBLIC SERVICE COMPANY CORPORATION
By C.H. STETSON By L. DOUGLAS MEREDITH
Chairman President
209 State Street 77 Grove Street
Presque Isle, Maine 04769 Rutland, Vermont 05701
<PAGE> 18
EXHIBIT MET-5
ADDITIONAL POWER CONTRACT
DATED AS OF FEBRUARY 1, 1984
CONFORMED
BETWEEN MAINE YANKEE ATOMIC POWER COMPANY AND PURCHASER
<PAGE> 19
(Conformed)
ADDITIONAL POWER CONTRACT, dated as of February 1, 1984, between MAINE
YANKEE ATOMIC POWER COMPANY ("Maine Yankee"), a Maine corporation, and [The
names of the Purchasers appear in the attached Appendix] (the "Purchaser").
It is agreed as follows:
1. BASIC UNDERSTANDINGS.
Maine Yankee was organized in 1966 to provide for the supply of power to
its eleven sponsoring utility companies (including the Purchaser), which
utilities are hereinafter called the "sponsors". It constructed a nuclear
electric generating unit of the pressurized water type, having a maximum net
capability of approximately 830 megawatts electric, on Bailey Point in
Wiscasset, Maine (said unit being herein, together with the site and all related
facilities owned or to be owned by Maine Yankee, referred to as the "Unit"). On
June 27, 1973 Maine Yankee was issued a full-term, operating license for the
Unit from the Atomic Energy Commission (now the Nuclear Regulatory Commission
which, together with any successor agency or agencies, is hereafter called the
"NRC"), which license expires on October 21, 2008, and the Unit commenced
commercial operation on January 1, 1973.
The Unit is operated to supply power to Maine Yankee's sponsors, each of
which by a Power Contract dated as of
<PAGE> 20
May 20, 1968, as amended and as may be further amended from time to time
(collectively the "Initial Power Contracts"), has undertaken to purchase a fixed
percentage of the capacity and output of the Unit for a term extending through
January 1, 2003. The names of the sponsors and their respective percentages
("entitlement percentages") of the capacity and output of the Unit are as
follows:
Entitlement
Sponsor Percentage
------- ----------
Central Maine Power Company ........................... 38.0%
New England Power Company ............................. 20.0%
The Connecticut Light and Power Company ............... 12.0%
Bangor Hydro-Electric Company ......................... 7.0%
Maine Public Service Company .......................... 5.0%
Public Service Company of New Hampshire ............... 5.0%
Cambridge Electric Light Company ...................... 4.0%
Montaup Electric Company .............................. 4.0%
Western Massachusetts Electric Company ................ 3.0%
Central Vermont Public Service Corporation ............ 2.0%
-----
100.0%
The sponsors have resold portions of their entitlement percentages of
capacity and output of the Unit under the Initial Power Contracts to other
utilities (the "secondary purchasers") on terms and conditions substantially
equivalent to those in the Initial Power contracts: in 1972, the three Maine
sponsors resold an aggragate of .7158% of the Unit's capacity and output to
other utilities in Maine and, also in 1972, the non-Maine sponsors resold an
aggregate of 5.5689% of the Unit's capacity and output to other New England
utilities outside of Maine (collectively the "Resale Contracts"). In 1983 the
Initial Power Contracts were amended to incorporate provisions for
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<PAGE> 21
collection of funds to defray the ultimate cost of decommissioning the Unit,
which costs are being borne PRO RATA by the secondary purchasers under the
Resale Contracts.
Maine Yankee and its sponsors desire to provide for the orderly
continuation of the sale and purchase of the capacity and output of the Unit
during the useful life of the Unit to the extent it continues beyond the
termination date of the Initial Power Contracts, and to provide appropriate
provisions for the collection of funds for and the payment of decommissioning
and any other costs with respect thereto both during and after the useful life
of the Unit. Maine Yankee and its other sponsors are entering into Additional
Power Contracts which are identical to this contract except for necessary
changes in the names of the parties.
2. EFFECTIVE DATE, TERM AND WAIVER.
This contract shall become effective upon receipt by the Purchaser of
notice that Maine Yankee has entered into Additional Power Contracts, as
contemplated by Section 1 above, with each of its other sponsors. The operative
term of this contract shall commence on January 2, 2003, notwithstanding the
fact that the useful service life of the Unit may have been terminated prior to
that date, and shall terminate upon the later to occur of (i) 30 days after the
date on which the last of the financial obligations of Maine Yankee which
constitute elements of the purchase price
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<PAGE> 22
calculated pursuant to Section 7 of this contract has been extinguished by Maine
Yankee or (ii) 30 days after the date on which Maine Yankee is finally relieved
of any obligations under the last of any licenses (operating and/or possessory)
which it now holds from, or which may hereafter be issued to it by, the NRC with
respect to the Unit under applicable provisions of the Atomic Energy Act of
1954, as amended from time to time (the "Act").
Maine Yankee and the Purchaser acknowledge that if the useful service life
of the Unit is terminated prior to January 2, 2003, then only the provisions of
this contract applicable to decommissioning of the Unit will apply during the
operative term of this contract.
The Purchaser hereby irrevocably waives its right to extend the contract
term of its Initial Power Contract pursuant to subsections (a) or (b) of Section
8 thereof.
3. OPERATION AND MAINTENANCE OF THE UNIT.
Maine Yankee will operate and maintain the Unit in accordance with good
utility practice under the circumstances and all applicable law, including the
applicable provisions of the Act and of any licenses issued thereunder to Maine
Yankee. Within the limits imposed by good utility practice under the
circumstances and applicable law, the Unit will be operated at its maximum
capability and on a long hour use basis.
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<PAGE> 23
Outages for inspection, maintenance, refueling and repairs and replacements
will be scheduled in accordance with good utility practice, and insofar as
practicable shall be mutually agreed upon by Maine Yankee and the Purchaser. In
the event of an outage, Maine Yankee will use its best efforts to restore the
Unit to service as promptly as practicable.
4. DECOMMISSIONING.
After commercial operation of the Unit permanently ceases, Maine Yankee
will decommission the Unit in a manner authorized by Maine Yankee's board of
directors and approved by the NRC in accordance with the Act and the rules and
regulations thereunder then in effect and by any agency having jurisdiction over
decommissioning of the Unit.
It is understood that, pursuant to the Initial Power Contracts and the
Resale Contracts, the sponsors and secondary purchasers are currently being
billed for Total Decommissioning Costs which, as of the date of this contract,
are being accumulated in a separate trust fund (the "Maine Yankee Trust") which
was established for the purpose of reimbursing Maine Yankee for Decommissioning
Expenses incurred in the process of decommissioning the Unit and that such
billings are subject to change in accordance with the provisions of the Initial
Power Contracts, subject to the jurisdiction of the Federal Energy Regulatory
Commission ("FERC"), formerly the Federal Power Commission.
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<PAGE> 24
It is contemplated that sufficient funds will be accumulated pursuant to those
contracts and paragraph 7 hereof to reimburse Maine Yankee for the full cost of
decommissioning the Unit.
5. PURCHASER'S ENTITLEMENT.
The Purchaser will, throughout the term of this contract, be entitled and
obligated to take its entitlement percentage of the capacity and net electrical
output of the Unit, at whatever level the Unit is operated or operable, whether
more or less than 830 megawatts electric.
6. DELIVERIES AND METERING.
The Purchaser's entitlement percentage, of the output of the Unit will be
delivered to and accepted by it at the step-up substation at the site. All
deliveries will be made in the form of 3-phase, 60 cycle, alternating current at
a nominal voltage of 345,000 volts. The Purchaser will make its own arrangements
for the transmission of its entitlement percentage of the output of the Unit.
Maine Yankee will supply and maintain all necessary metering equipment for
determining the quantity and conditions of supply of deliveries under this
contract, will make appropriate tests of such equipment in accordance with good
utility practice and as reasonably requested by the Purchaser, and will maintain
the accuracy of such equipment within reasonable limits. Maine Yankee will
furnish the
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<PAGE> 25
Purchaser with such summaries of meter readings as the Purchaser may reasonably
request.
7. PAYMENT.
With respect to each month commencing on or after January 1, 2003, the
Purchaser will pay Maine Yankee an amount equal to the Purchaser's entitlement
percentage of the sum of (a) Maine Yankee's total fuel costs for the month with
respect to the Unit, plus (b) the Total Decommissioning Costs for the month
with respect to the Unit, plus (c) Maine Yankee's total operating expenses for
the month with respect to the Unit, plus (d) an amount equal to one-twelfth of
the composite percentage for such month of the net Unit investment as most
recently determined in accordance with this Section 7.
"Composite percentage" shall be computed as of the last day of each month
during the term hereof (the "computation date") and for any month the composite
percentage shall be that computed as of the last day of the previous month.
"Composite percentage" as of a computation date shall be the sum of (i) the
equity percentage as of such date multiplied by the percentage which equity
investment with respect to the Unit (other than equity investment for the
financing of fuel inventory, including nuclear materials and the cost of
fabrication thereof, for the Unit) as of such date is of the total capital as of
such date; plus (ii) the "effective interest rate" per annum of each principal
amount of
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<PAGE> 26
indebtedness outstanding on such date for money borrowed with respect to the
Unit (other than for money borrowed for the financing of fuel inventory,
including nuclear materials and the cost of fabrication thereof, for the Unit),
multiplied by the percentage which such principal amount is of total capital as
of such date. The "effective interest rate" of each principal amount of
indebtedness referred to in clause (ii) of the next preceding sentence will
reflect the annual interest requirements and to the extent applicable,
amortization of issue expenses, discounts and premiums, sinking fund call
premiums, expenses and discounts, refunding and retirement expenses, discounts
and premiums, and all other expenses applicable to the issue.
"Equity investment" as of any date shall consist of the sum of (i) all
amounts theretofore paid to Maine Yankee for all capital stock theretofore
issued, plus all capital contributions, less the sum of any amounts paid by
Maine Yankee in the form of stock retirements, repurchases or redemptions or
return of capital; plus (ii) any credit balance in the capital surplus account
not included under (i) and in the earned surplus account on the books of Maine
Yankee as of such date.
"Equity percentage" as of any date after commencement of the operative term
hereof shall be that percentage which was the "equity percentage" in effect on
the last day of the
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<PAGE> 27
term of the Initial Power Contracts or such other percentage as may from time to
time thereafter be approved by FERC.
"Total capital" as of any date shall be the equity investment with respect
to the Unit, plus the total of all other securities and indebtedness then
outstanding with respect to the Unit other than equity investment, securities,
indebtedness and other obligations issued in connection with the financing or
leasing of fuel inventory, including nuclear materials and the cost of
fabrication thereof, for the Unit.
"Uniform System" shall mean the Uniform System of Accounts prescribed by
FERC for Class A and Class B Public Utilities and Licensees as in effect on the
date of this Agreement and as said System may be hereafter amended to take
account of private ownership of special nuclear material.
Maine Yankee's "fuel costs" for any month shall include (i) amounts
chargeable in accordance with the Uniform System in such month as amortization
of costs of fuel assemblies and components and burn-up of nuclear materials for
the Unit; plus (ii) all other amounts properly chargeable in accordance with the
Uniform System to fuel costs for the Unit less any applicable credits thereto;
plus (iii) one-twelfth of the equity percentage as of such month multiplied by
the equity investment for the financing of fuel inventory, including nuclear
materials and the cost of
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<PAGE> 28
fabrication thereof, for the Unit; plus (iv) to the extent not provided for in
any of the foregoing, all payments (or accruals therefor or amortization
thereof) with respect to obligations incurred in connection with the financing
or leasing of fuel inventory, including nuclear materials and the cost of
fabrication thereof, for the Unit (provided that such inventory is not included
in the net Unit investment).
Maine Yankee's "operating expenses" shall include all amounts properly
chargeable to operating expense accounts (other than such amounts which are
included in Maine Yankee's fuel costs), less any applicable credits thereto, in
accordance with the Uniform System; it being understood that for purposes of
this contract "operating expenses" shall include depreciation accrual and
amortization at a rate at least sufficient to fully amortize the non-
salvageable plant investment over the estimated remaining useful life of the
plant.
The "net Unit investment" shall consist, in each case with respect to the
Unit, the net sum of (i) the aggregate amount properly chargeable at the time in
accordance with the Uniform System to Maine Yankee's electric plant accounts
(including construction work in progress); plus (ii) the amount of any
unamortized property losses; less (iii) the amount of any reserves for
depreciation and for amortization of property losses; plus (iv) such allowances
for inventories, materials and supplies (other than fuel
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<PAGE> 29
assemblies and components), prepaid items and cash working capital as may
reasonably be determined from time to time by Maine Yankee. The net Unit
investment shall be determined as of the commencement of each calendar year, or,
if Maine Yankee elects, at more frequent intervals.
"Total Decommissioning Costs" for any month shall mean the sum of (x) an
amount equal to all accruals in such month to any reserve, as from time to time
established by Maine Yankee and approved by its board of directors, to provide
for the ultimate payment of the Decommissioning Expenses of the Unit plus (y)
Decommissioning Tax Liability for such month. It is understood (i) that such
funds may be held by Maine Yankee or by any independent trust or other separate
fund, as determined by said board of directors, (ii) that, upon compliance with
Section 18 hereof, the amount, custody and/or timing of such accruals may from
time to time during the term hereof be modified by said board of directors in
its discretion or to comply with applicable statutory or regulatory requirements
or to reflect changes in the amount, custody or timing of anticipated
Decommissioning Expenses, and (iii) that the use of the term "to decommission"
herein encompasses compliance with all requirements (other than those relating
to spent nuclear fuel) of the NRC for permanent cessation of operation of a
nuclear facility. "Decommissioning Expenses" shall include:
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<PAGE> 30
(1) All costs and expenses of removing the Unit from service, including without
limitation, dismantling, mothballing, removing radioactive material
(excluding spent nuclear fuel) to temporary and/or permanent storage sites,
decontaminating, restoring and supervising the site, and any costs and
expenses incurred in connection with proceedings before governmental
regulatory authorities relating to any authorization to decommission the
Unit or remove the Unit from service;
(2) All costs of labor and services, whether directly or indirectly incurred,
including without limitation services of foremen, inspectors, supervisors,
surveyors, engineers, security personnel, counsel and accountants,
performed or rendered in connection with the decommissioning of the Unit
and the removal of the Unit from service, and all costs of materials,
supplies, machinery, construction equipment and apparatus acquired or used
(including rental charges for machinery, equipment or apparatus hired) for
or in connection with the decommissioning of the Unit and the removal of
the Unit from service, and all administrative costs, including services of
counsel and financial advisers, of any applicable independent trust or
other separate fund; it being
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<PAGE> 31
understood that any amount, exclusive of proceeds of insurance, realized by
Maine Yankee as salvage on any machinery, construction equipment and
apparatus, the cost of which was charged to Decommissioning Expense, shall
be treated as a reduction of the amounts otherwise chargeable on account of
the costs of decommissioning of the Unit; and
(3) All overhead costs applicable to the Unit during its decommissioning
period, including, without limiting the generality of the foregoing, taxes
(other than taxes on or in respect of income), licenses, excises and
assessments, casualties, surety bond premiums and insurance premiums.
"Decommissioning Tax Liability" for any month shall be an amount
established by Maine Yankee and approved by its board of directors to meet
possible income tax obligations, which amount shall not exceed: the amount to be
included in the clause (x) portion of Total Decommissioning Costs for such month
multiplied by a fraction whose numerator is equal to the combined highest
statutory Federal and state marginal income tax rate and whose denominator is
equal to one minus the combined highest statutory Federal and state marginal
income tax rate.
Without limiting the generality of the foregoing, any other amounts
expended or to be paid with respect to
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<PAGE> 32
decommissioning of the Unit or removal of the Unit from service shall constitute
part of the Decommissioning Expenses if they are, or when paid will be, either
(i) properly chargeable to any account related to decommissioning of a nuclear
generating unit in accordance with the Uniform System or generally accepted
accounting principles as then in effect, or (ii) properly chargeable to
decommissioning of a nuclear generating unit in accordance with then applicable
regulations of the NRC or FERC or any other regulatory agency having
jurisdiction.
8. BILLING.
Maine Yankee will bill the Purchaser, as soon as practicable after the end
of each month, for all amounts payable by the Purchaser with respect to the
particular month pursuant to Section 7 hereof. Such bills will be rendered in
such detail as the Purchaser may reasonably request and may be rendered on an
estimated basis subject to corrective adjustments in subsequent billing periods.
All bills shall be paid in full within 10 days after receipt thereof by the
Purchaser.
When all or any part of any bill shall remain unpaid for more than thirty
(30) days after the due date thereof, simple interest at an annual rate which is
at all times 1% in excess of the prime rate for commercial loans in effect at
The First National Bank of Boston shall accrue to Maine
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<PAGE> 33
Yankee from and after the thirtieth day from the due date of said bill.
9. DECOMMISSIONING FUND.
Maine Yankee agrees to pay to, or cause to be paid to, the Maine Yankee
Trust or any successor trust approved by the board of directors of Maine Yankee
all funds collected hereunder for the express purpose of decommissioning the
Unit or removing the Unit from service and further agrees that, after the tax
consequences of decommissioning collections have been resolved, any funds
collected hereunder to meet Decommissioning Tax Liability which are not used for
that purpose will be refunded to the Purchaser to the extent required by FERC.
10. CANCELLATION OF CONTRACT.
If deliveries cannot be made to the Purchaser because either
(i) the Unit is damaged to the extent of being completely or
substantially completely destroyed, or
(ii) the Unit is taken by exercise of the right of eminent domain or a
similar right or power, or
(iii) (a) the Unit cannot be used because of contamination, or because
a necessary license or other necessary public authorization cannot be
obtained or is revoked, or because the utilization of such a license or
authorization is made subject to specified conditions which are not met,
and (b) the situation cannot be
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<PAGE> 34
rectified to an extent which will permit Maine Yankee to make deliveries to
the Purchaser from the Unit;
then and in any such case, the Purchaser may cancel the provisions of this
contract, except that in all cases other than those described in clause (ii)
above, the provisions relating to the payment of Total Decommissioning Costs
shall, whether or not the Unit is operated or operable and notwithstanding any
earlier termination of the service life of the Unit, remain in full force and
effect until the expiration of the term hereof, it being recognized that such
costs represent deferred payment in connection with power theretofore delivered
by Maine Yankee hereunder. Such cancellation shall be effected by written notice
given by the Purchaser to Maine Yankee. In the event of such cancellation, all
continuing obligations of the parties hereunder (other than the obligations
relating to the payment and application of Total Decommissioning Costs to the
extent that such obligations remain in full force and effect pursuant to the
second preceding sentence, but including the Purchaser's obligations to continue
payments pursuant to clauses (a), (c) and (d) of the first paragraph of Section
7 hereof) shall cease forthwith. Notwithstanding the foregoing, the applicable
provisions of this contract shall continue in effect after the cancellation
hereof to the extent necessary to permit final billings and adjustments
hereunder with respect to obligations incurred
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<PAGE> 35
through the date of cancellation and the collection thereof. Any dispute as to
the Purchaser's right to cancel this contract pursuant to the foregoing
provisions shall be referred to arbitration in accordance with the provisions of
Section 14 hereof.
Notwithstanding anything in this contract elsewhere contained, the
Purchaser may cancel this contract or be relieved of its obligations to make
payments hereunder only as provided in the next preceding paragraph of this
Section 10. Further, if for reasons beyond Maine Yankee's reasonable control,
deliveries are not made as contemplated by this contract, Maine Yankee shall
have no liability to the Purchaser on account of such non-delivery.
11. INSURANCE.
Maine Yankee presently has in effect, and hereafter will at all times
maintain until the expiration of the term hereof, insurance to cover its "public
liability" for personal injury and property damage resulting from a "nuclear
incident" (as those terms are defined in the Act), with limits not less
than Maine Yankee may be required to maintain to qualify for governmental
indemnity under the Act and shall execute and maintain an indemnification
agreement with the NRC as provided by the Act. Maine Yankee will also at all
times maintain such other types of liability insurance, including workmen's
compensation insurance, in
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<PAGE> 36
such amounts as is customary in the case of other similar electric utility
companies or as may be required by law.
Maine Yankee will at all times keep insured such portions of the Unit
(other than the fuel assemblies and components, including nuclear materials) as
are of a character usually insured by electric utility companies similarly
situated and operating like properties, against the risk of a "nuclear incident"
and such other risks as electric utility companies, similarly situated and
operating like properties, usually insure against; and such insurance shall to
the extent available be carried in amounts sufficient to prevent Maine Yankee
from becoming a co-insurer. Maine Yankee will at all times keep its fuel
assemblies and components (including nuclear materials) insured against such
risks and in such amounts as shall, in the opinion of Maine Yankee, provide
adequate protection.
12. ADDITIONAL UNITS.
At any time after the date hereof Maine Yankee or its nominees may install
one or more additional generating units at the Wiscasset site. The installation
of such unit or units shall not affect the terms of this contract, but in such
case if any portion of the Unit (whether such portion constitutes land,
structures or equipment) is also used with an additional unit or units, an
appropriate allocation of the cost of the Unit shall be made and the net Unit
investment shall be reduced accordingly, subject, however,
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<PAGE> 37
to the limitation that the aggregate amount of the reduction in net Unit
investment resulting from all such allocations shall not exceed $5,000,000.
Maine Yankee may make any other necessary allocations or any necessary
adjustments in its accounts with respect to the Unit (including fuel assemblies
and components) and any additional unit or units, and such allocations and
adjustments shall be binding on the sponsors.
13. AUDIT.
Maine Yankee's books and records (including metering records) shall be open
to reasonable inspection and audit by the Purchaser.
14. ARBITRATION.
In case any dispute shall arise as to the interpretation or performance of
this contract which cannot be settled by mutual agreement and which may be
finally determined by arbitration under the law of the State of Maine then in
effect, such dispute shall be submitted to arbitration, and arbitration of such
dispute shall be a condition precedent to any action at law or suit in equity
that can be brought. The parties shall if possible agree upon a single
arbitrator. In case of failure to agree upon an arbitrator within 15 days after
the delivery by either party to the other of a written notice requesting
arbitration, either party may request the American Arbitration Association to
appoint the arbitrator. The arbitrator, after opportunity
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<PAGE> 38
for each of the parties to be heard, shall consider and decide the dispute and
notify the parties in writing of his decision. The expenses of the arbitration
shall be borne equally by the parties.
15. REGULATION.
This contract, and all rights, obligations and performance of the parties
hereunder, are subject to all applicable state and federal law and to all duly
promulgated orders and other duly authorized action of governmental authority
having jurisdiction in the premises.
16. ASSIGNMENT.
This contract shall be binding upon and shall inure to the benefit of, and
may be performed by, the successors and assigns of the parties, except that no
assignment, pledge or other transfer of this contract by either party shall
operate to release the assignor, pledgor or transferor from any of its
obligations under this contract unless consent to the release is given in
writing by the other party, or, if the other party has theretofore assigned,
pledged or otherwise transferred its interest in this contract, by the other
party's assignee, pledgee or transferee, or unless such transfer is incident to
a merger or consolidation with, or transfer of all or substantially all of the
assets of the transferor to, another sponsor which shall, as a part of such
succession, assume all the obligations of the transferor under this contract.
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<PAGE> 39
17. RIGHT OF SETOFF.
The Purchaser shall not be entitled to set off against the payments
required to be made by it under this contract (i) any amounts owed to it by
Maine Yankee or (ii) the amount of any claim by it against Maine Yankee.
However, the foregoing shall not affect in any other way the Purchaser's right
and remedies with respect to any such amounts owed to it by Maine Yankee or any
such claim by it against Maine Yankee.
18. AMENDMENTS.
Upon authorization by Maine Yankee's board of directors of uniform
amendments to all the Additional Power Contracts with sponsors, Maine Yankee
shall have the right to amend the provisions of Section 7 hereof insofar as they
relate to the amounts collectible by Maine Yankee pursuant to clause (b) of the
first paragraph of Section 7 hereof or to the timing of such collections by
serving an appropriate statement of such amendment upon the Purchaser and filing
the same with FERC (or such other regulatory agency as may have jurisdiction in
the premises) in accordance with the provisions of applicable laws and any rules
and regulations thereunder, and the amendment shall thereupon become effective
on the date specified therein, subject to any suspension order issued by such
agency. All other amendments to this contract shall be by mutual agreement,
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<PAGE> 40
evidenced by a written amendment signed by the parties hereto.
19. INTERPRETATION.
The interpretation and performance of this contract shall be in
accordance with and controlled by the law of the State of Maine.
20. ADDRESSES.
Except as the parties may otherwise agree, any notice, request, bill or
other communication from one party to the other, relating to this contract, or
the rights, obligations or performance of the parties hereunder, shall be in
writing and shall be effective upon delivery to the other party. Any such
communication shall be considered as duly delivered when delivered in person or
mailed by registered or certified mail, postage prepaid, to the post office
address of the other party shown following the signature of such other party
hereto, or such other address as may be designated by written notice given as
provided in this Section 20.
21. CORPORATE OBLIGATIONS.
This contract is the corporate act and obligation of the parties hereto,
and any claim hereunder against any stockholder (other than the Purchaser),
director or officer of either party, as such, is expressly waived.
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<PAGE> 41
22. ALL PRIOR AGREEMENTS SUPERSEDED.
This contract represents the entire agreement between the parties relating
to the subject matter hereof during the operative term hereof (i.e.,
post-January 1, 2003), and all previous agreements, discussions, communications
and correspondence with respect to the subject matter are hereby superseded and
are of no further force and effect.
IN WITNESS WHEREOF, the parties have executed this contract by their
respective officers thereunto duly authorized as of the date first above
written.
MAINE YANKEE ATOMIC POWER COMPANY
By
-------------------------------------
President
Edison Drive
Augusta, Maine 04336
By
-------------------------------------
(Officer and Title)
(Address)
-------------------------------------
-------------------------------------
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<PAGE> 42
MAINE YANKEE ATOMIC POWER PUBLIC SERVICE COMPANY
COMPANY OF NEW HAMPSHIRE
By C. E. Monty By R. J. Harrison
President President
Edison Drive 1000 Elm Street
Augusta, ME 04336 Manchester, NH 03101
CENTRAL MAINE POWER COMPANY CAMBRIDGE ELECTRIC LIGHT COMPANY
By John W. Rowe By G. E. Anderson
President Chairman and Chief Executive Officer
Edison Drive P. 0. Box 190
Augusta, ME 04336 Cambridge, MA 02139
NEW ENGLAND POWER COMPANY MONTAUP ELECTRIC COMPANY
By Jeffrey Tranen By John F. G. Eichorn, Jr.
Vice President President
25 Research Drive P. 0. Box 2333
Westborough, MA 01582 Boston, MA 02107
THE CONNECTICUT LIGHT AND POWER WESTERN MASSACHUSETTS ELECTRIC
COMPANY COMPANY
By E. James Ferland By E. James Ferland
President & Chief Operating President & Chief Operating
Officer Officer
107 Selden Street 107 Selden Street
Berlin, CT 06307 Berlin, CT 06307
BANGOR HYDRO-ELECTRIC COMPANY CENTRAL VERMONT PUBLIC SERVICE
CORPORATION
By T. A. Greenquist
President By James E. Griffin
33 State Street President and Chief Executive
Bangor, ME 04401 Officer
77 Grove Street
MAINE PUBLIC SERVICE COMPANY Rutland, VT 05701
By G. M. Hovey
President
209 State Street
Presque Isle, ME 04769
<PAGE> 43
EXHIBIT MET-6
1997 AMENDATORY AGREEMENTS
DATED AS OF AUGUST 6, 1997
BETWEEN MAINE YANKEE ATOMIC POWER COMPANY
AND
CENTRAL MAINE POWER COMPANY ("PURCHASER")
<PAGE> 44
MAINE YANKEE ATOMIC POWER COMPANY
1997 AMENDATORY AGREEMENT
This 1997 Amendatory Agreement, dated as of August 6, 1997, is entered into
by and between MAINE YANKEE ATOMIC POWER COMPANY, a Maine corporation ("Maine
Yankee" or "Seller"), and CENTRAL MAINE POWER COMPANY ("Purchaser").
For good and valuable consideration, the receipt of which is hereby
acknowledged, it is agreed as follows:
l. BASIC UNDERSTANDINGS
Maine Yankee was organized in 1966 to provide a supply of power to its
sponsoring utility companies, including the Purchaser (collectively the
"Purchasers"). It constructed a nuclear electric generating unit, having a net
capability of approximately 830 megawatts electric (the "Unit") at a site on
tidewater in the Town of Wiscasset, Maine. On June 27, 1973, Maine Yankee was
issued a full-term, Facility Operating License for the Unit by the Atomic Energy
Commission (predecessor to the Nuclear Regulatory Commission which, together
with any successor agencies, is hereafter called the "NRC"), which license is
now stated to expire on October 21, 2008. The Unit has been in commercial
operation since January 1, 1973.
The Unit was conceived to supply economic power on a cost of service
formula basis to the Purchasers. Maine Yankee and the Purchaser are parties to a
Power Contract dated as of May 20, 1968 (as herefore amended, the "Power
Contract"). Pursuant to the Power
<PAGE> 45
Contract and other identical contracts (collectively, the "Power Contracts")
between Maine Yankee and the other Purchasers, Maine Yankee contracted to supply
to the Purchasers all of the capacity and electric energy available from the
Unit for a term of thirty (30) years following January 1, 1973.
Maine Yankee and the Purchaser are also parties to an Additional Power
Contract, dated as of February 1, 1984 ("Additional Power Contract"). The
Additional Power Contract and other similar contracts (collectively, the
"Additional Power Contracts") between Maine Yankee and the other Purchasers
provide for an operative term stated to commence on January 2, 2003 (when the
Power Contracts terminate) and extending until a date which is the later to
occur of (i) 30 days after the date on which the last of the financial
obligations of Maine Yankee which constitute elements of the purchase price
thereunder has been extinguished by Maine Yankee or (ii) 30 days after the date
on which Maine Yankee is finally relieved of any obliations under the last of
the licenses (operating and/or possessory) which it holds from, or which may
hereafter be issued to it by, the NRC with respect to the Unit under applicable
provisions of the Atomic Energy Act of 1954, as amended from time to time (the
"Act").
Pursuant to the Power Contract and the Additional Power Contract, the
Purchaser is entitled and obligated to take its entitlement percentage of the
capacity and net electrical output of the Unit during the service life of the
Unit and is obligated to pay therefor monthly its entitlement percentage of
Maine Yankee's cost of service, including decommissioning costs, whether or not
the Unit is operated or whether or not net electrical output is delivered. The
Power Contracts and the Additional Power Contracts also provide, in the event of
their earlier cancellation, for the survival of the decommissioning cost
obligation and for the applicable
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<PAGE> 46
provisions thereof to remain in effect to permit final billings of costs
incurred prior to such cancellation.
On August 6, 1997, the board of directors of Maine Yankee, after conducting
a thorough review of the economics of continued operation of the Unit for the
remainder of the term of the Facility Operating License for the Unit in light of
other alternatives available to Maine Yankee and the Purchasers, determined that
the Unit should be permanently shut down effective August 6, 1997. The Purchaser
concurs in that decision.
As a consequence of the shutdown decision, Maine Yankee and the Purchaser
propose at this time to amend the Power Contract and the Additional Power
Contract in various respects in order to clarify and confirm provisions for the
recovery under said contracts of the full costs previously incurred by Maine
Yankee in providing power from the Unit during its useful life and of all costs
of decommissioning the Unit, including the costs of maintaining the Unit in a
safe condition following the shutdown and prior to its decontamination and
dismantlement.
Maine Yankee and each of the other Purchasers are entering into agreements
which are identical to this Agreement except for necessary changes in the names
of the parties.
2. PARTIES' CONTRACTUAL COMMITMENTS
Maine Yankee reconfirms its existing contractual obligations to protect the
Unit, to maintain in effect certain insurance and to prepare for and implement
the decommissioning of the Unit in accordance with applicable laws and
regulations. Consistent with public safety, Maine Yankee shall use its best
efforts to accomplish the shutdown of the Unit, the protection and any necessary
maintenance of the Unit after shutdown and the decommissioning of the
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<PAGE> 47
Unit in a cost-effective manner and in compliance with the regulations of the
NRC and other agencies having jurisdiction, and shall use its best efforts to
ensure that any required storage and disposal of the nuclear fuel remaining in
the reactor at shutdown and all spent nuclear fuel or other radioactive
materials resulting from operating of the Unit are accomplished consistent with
public health and safety considerations and at the lowest practicable cost. The
Purchaser reconfirms its obligations under the Power Contract and Additional
Power Contract to pay its entitlement percentage of Maine Yankee's costs as
deferred payment in connection with the capacity and net electrical output of
the Unit previously delivered by Maine Yankee and agrees that the decision to
shut down the Unit described in Section 1 hereof does not give rise to any
cancellation right under Section 9 of the Power Contract or Section 10 of the
Additional Power Contract.
Except as expressly modified by this Agreement, the provisions of the Power
Contract and the Additional Power Contract remain in full force and effect,
recognizing that the mutually accepted decision to shut down the Unit renders
moot those provisions which by their terms relate solely to continuing
operation of the Unit.
3. AMENDMENT OF PROVISIONS OF THE POWER CONTRACT AND THE ADDITIONAL POWER
CONTRACT
A. Section 2 of the Additional Power Contract is hereby amended to delete
the first two paragraphs thereof and to insert in lieu thereof the following:
This contract shall become effective on such date as may be authorized
by the FERC after receipt by the Purchaser of notice that Maine Yankee
has entered into Additional Power Contracts, as contemplated by
Section 1 above, with each of the other sponsors. The operative term
of this contract shall commence on the earlier of (a) the
termination, cancellation or expiration of the Power Contract or (b)
January 2, 2003, notwithstanding the fact that the useful service life
of the Unit terminated prior to that date and shall terminate on the
date (the
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<PAGE> 48
"End of Term Date") which is the later to occur of (i) 30 days after
the date on which the last of the financial obligations of Maine
Yankee which constitute elements of the purchase price calculated
pursuant to Section 7 of this contract has been satisfied in its
entirety by Maine Yankee, or (ii) 30 days after the date on which
Maine Yankee is finally relieved of any obligations under the last of
any licenses (operating and/or possessory) which it now holds from, or
which may hereafter be issued to it by, the NRC with respect to the
Unit under applicable provisions of the Atomic Energy Act of 1954, as
amended from time to rime (the "Act").
B. The first paragraph of Section 7 of the Additional Power Contract is
amended to read as follows:
With respect to each month commencing on or after the commencement of
the operative term of this contract, whether or not this contract
continues fully or partially in effect, the Purchaser will pay Maine
Yankee as further deferred payment for the capacity and output of the
Unit provided to the Purchaser by Maine Yankee prior to the permanent
shutdown of the Unit on August 6, 1997, an amount equal to the
Purchaser's entitlement percentage of the sum of (a) Maine Yankee's
total fuel costs for the month with respect to the Unit, (b) the Total
Decommissioning Costs for the month with respect to the Unit, plus (c)
Maine Yankee's total operating expenses (as hereinafter defined) for
the month with respect to the Unit, plus (d) an amount equal to
one-twelfth of the composite percentage for such month of the net Unit
investment as most recently determined in accordance with this Section
7.
C. The eighth paragraph of Section 7 of the Power Contract and the eighth
paragraph of Section 7 of the Additional Power Contract are each amended by (a)
inserting before the semicolon in the first sentence thereof the following:
, but including for purposes of this contract:
(i) with respect to each month until the commencement of
decommissioning of the Unit, the Purchaser's entitlement
percentage of all expenses related to the storage or disposal of
nuclear fuel or other radioactive materials, and all expenses
related to protection and maintenance of the
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<PAGE> 49
Unit during such period, including to the extent applicable all
of the various sorts of expenses included in the definition of
"Decommissioning Expenses", to the extent incurred during the
period prior to the commencement of decommissioning;
(ii) with respect to each month until the amount due from Maine Yankee
to the U.S. Department of Energy ("DOE") for disposal of
pre-April 7, 1983 spent nuclear fuel and associated high level
radioactive material has been paid in full, the Purchaser's
entitlement percentage of one-third (1/3) of the interest due to
DOE during that calendar quarter on such obligation; and
(iii) with respect to each month until End of License Term, the
Purchaser's entitlement percentage of the monthly amortization of
(a) the amount of any unamortized deferred expenses, as permitted
from time to time by the Federal Energy Regulatory Commission or
its successor agency, plus (b) the remaining unamortized amount
of Maine Yankee's investment in plant, nuclear fuel and materials
and supplies and other assets, such amortization to be accrued at
a rate sufficient to amortize fully such unamortized deferred
expenses and Maine Yankee's investments in plant, nuclear fuel
and materials and supplies or other assets (the "total
investment") over a period extending to October 21, 2008;
[PROVIDED, that if during any calendar month ending on or before
May 1, 2008 either of the following events shall occur: (a) Maine
Yankee shall
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<PAGE> 50
become insolvent or (b) Maine Yankee shall be unable, from
available cash or other sources, to meet when due during such
month its obligations to pay principal, interest, premium (if
any) or other fees with respect to any indebtedness for money
borrowed, then Maine Yankee may adjust upward the accrual for
amortization of unrecovered total investment for such month to an
amount not exceeding the applicable maximum level specified in
Appendix A hereto, PROVIDED that concurrently therewith the total
investment shall be reduced by an amount equal to the amount of
such adjustment, it being understood that at the time of such
event, Maine Yankee will furnish the Purchaser with a schedule
setting forth the amount of such adjustment;](1)
and (b) by adding at the end thereof the following:
As used herein, "End of License Term" means October 21, 2008 or
such later date as may be fixed, by amendment to the Facility
Operating License for the Unit, as the end of the term of the
Facility Operating License.
D. The definitions in Section 7 of the Power Contract and in Section 7 of
the Additional Power Contract of "Total Decommissioning Costs" and
"Decommissioning Expenses" are hereby amended to read as follows:
---------------
(1) Bracketed language would be inserted only if satisfactory work-out is
reached with lender banks and insurance companies.
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<PAGE> 51
"Total Decommissioning Costs" for any month shall mean the sum of (x) an amount
equal to all accruals in such month to any reserve, as from time to time
established by Maine Yankee and approved by its board of directors, to provide
for the ultimate payment of the Decommissioning Expenses of the Unit, plus (y),
during the Decommissioning Period, the Decommissioning Expenses for the month,
to the extent such Decommissioning Expenses are not paid with funds from such
reserve, plus (z) Decommissioning Tax Liability for such month. It is understood
(i) that funds received pursuant to clause (x) may be held by Maine Yankee or by
an independent trust or other separate fund, as determined by said board of
directors, (ii) that, upon compliance with applicable regulatory requirements,
the amount, custody and/or timing of such accruals may from time to time during
the term hereof be modified by said board of directors in its discretion or to
comply with applicable statutory or regulatory requirements or to reflect
changes in the amount, custody or timing of anticipated Decommissioning
Expenses, and (iii) that the use of the term "to decommission" herein
encompasses compliance with all requirements of the NRC, as in effect from time
to time, for permanent cessation of operation of a nuclear facility and any
other activities reasonably related thereto, including provision for disposal of
low level waste and the interim storage of spent nuclear fuel.
"Decommissioning Expenses" shall include all expenses of decommissioning the
Unit, and all expenses relating to ownership and protection of the Unit during
the Decommissioning Period, and shall also include the following:
(1) All costs and expenses of any NRC-approved method of removing the Unit from
service, including without limitation: dismantling, mothballing and
entombment of the Unit; removing nuclear fuel and other radioactive
material to temporary and/or permanent storage sites; construction,
operation, maintenance and dismantling of a spent fuel storage facility;
decontaminating, restoring and supervising the site; and any costs and
expenses incurred in connection with proceedings before governmental
authorities relating to any authorization to decommission the Unit or
remove the Unit from service;
(2) All costs of labor and services, whether directly or indirectly incurred,
including without limitation, services of foremen, inspectors, supervisors,
surveyors, engineers, security personnel, counsel and accountants,
performed or rendered in connection with the decommissioning of the Unit
and the removal of the Unit from service, and all costs of materials,
supplies, machinery, construction equipment and apparatus acquired or used
(including
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<PAGE> 52
rental charges for machinery, equipment or apparatus hired) for
or in connection with the decommissioning of the Unit and the
removal of the Unit from service, and all administrative costs,
including services of counsel and financial advisers of any
applicable independent trust or other separate fund; it being
understood that any amount, exclusive of proceeds of insurance,
realized by Maine Yankee as salvage on any machinery,
construction equipment and apparatus, the cost of which was
charged to Decommissioning Expense, shall be treated as a
reduction of the amounts otherwise chargeable on account of the
costs of decommissioning of the Unit; and
(3) All overhead costs applicable to the Unit during the
Decommissioning Period, or accrued during such period, including
without limiting the generality of the foregoing, taxes (other
than taxes on or in respect of income), charges, license fees,
excises and assessments, casualties, health care costs, pension
benefits and other employee benefits, surety bond premiums and
insurance premiums.
E. Section 7 of the Power Contract and Section 7 of the Additional Power
Contract are each hereby amended by adding the following new paragraph after the
definition of "Decommissioning Tax Liability":
"Decommissioning Period" shall mean the period commencing with the
notification by Maine Yankee to the NRC of the decision of the board
of directors of Maine Yankee to cease permanently the operation of the
Unit for the purpose of producing electric energy and ending with the
date when Maine Yankee has completed the decommissioning of the Unit
and the restoration of the site and has been relieved of all its
obligations under the last of any licenses issued to it by the NRC.
F. Section 8 of the Additional Power Contract is hereby amended to change
the figure "1%" to "2%".
G. Section 9 of the Power Contract and Section 10 of the Additional Power
Contract are each amended to read as follows:
10. CANCELLATION OF CONTRACT.
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<PAGE> 53
If either
(i) the Unit is damaged to the extent of being completely or
substantially completely destroyed, or
(ii) the Unit is taken by exercise of the right of eminent
domain or a similar right or power,
then and in any such case, the Purchaser may cancel the provisions of
this contract, except that in all cases other than those described in
clause (ii) above, the Purchaser shall be obligated to continue to
make the payments of Total Decommissioning Costs and the other
payments required by Section 7 hereof and the provisions of said
Section 7 and the related provisions of this contract shall remain in
full force and effect, it being recognized that the costs which
Purchaser is required to pay pursuant to Section 7 represent deferred
payments in connection with power heretofore delivered by Maine Yankee
under its contractual commitments to the Purchaser. Such cancellation
shall be effected by written notice given by the Purchaser to Maine
Yankee. In the event of such cancellation, all continuing obligations
of the parties hereunder as to subsequently incurred costs of Maine
Yankee other than the obligations of the Purchaser to continue to make
the payments required by Section 7 shall cease forthwith (it being
understood that the continuing accrual of depreciation of net Unit
investment and of fees, interest and other payments under pre-existing
contracts subsequent to such cancellation shall not be deemed to be
"subsequently incurred costs" for purposes of this sentence).
Notwithstanding the preceding sentence, the applicable provisions of
this contract shall continue in effect after the cancellation hereof
to the extent necessary to permit final billings and adjustments
hereunder with respect to obligations incurred through the date of
cancellation and the collection thereof. Any dispute as to the
Purchaser's right to cancel this contract pursuant to the foregoing
provisions shall be referred to arbitration in accordance with the
provisions of this contract.
Notwithstanding anything in this contract elsewhere contained,
the Purchaser may cancel this contract or be relieved of its
obligations to make payments hereunder only as provided in the next
preceding paragraph of this Section.
5. EFFECTIVE DATE
This 1997 Amendatory Agreement shall become effective upon receipt by the
Purchaser of notice that Maine Yankee has entered into 1997 Amendatory
Agreements, as
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<PAGE> 54
contemplated by Section 1 hereof, with each of the other Purchasers and receipt
of requisite authorization from the FERC.
6. INTERPRETATION
The interpretation and performance of this 1997 Amendatory Agreement shall
be in accordance with and controlled by the laws of the State of Maine.
7. ADDRESSES
Except as the parties may otherwise agree, any notice, request, bill or
other communication from one party to the other relating to this 1997 Amendatory
Agreement, or the rights, obligations or performance of the parties hereunder,
shall be in writing and shall be effective upon delivery to the other party. Any
such communication shall be considered as duly delivered when mailed to the
respective post office address of the other party shown following the signatures
of such other party hereto, or such other post office address as may be
designated by written notice given in the manner as provided in this Section.
8. CORPORATE OBLIGATIONS
This 1997 Amendatory Agreement is the corporate act and obligation of the
parties hereto.
9. COUNTERPARTS
This 1997 Amendatory Agreement may be executed in any number of
counterparts and each executed counterpart shall have the same force and effect
as an original instrument and as if all the parties to all of the counterparts
had signed the same instrument. Any signature page of this 1997 Amendatory
Agreement may be detached from any counterpart without impairing the legal
effect of any signatures thereon, and may be attached to another counterpart of
this
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<PAGE> 55
1997 Amendatory Agreement identical in form hereto but having attached to it one
or more signature pages.
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<PAGE> 56
IN WITNESS WHEREOF, the parties have executed this 1997 Amendatory
Agreement by their respective duly authorized officers as of the day and year
first named above.
MAINE YANKEE ATOMIC POWER COMPANY
By ?????????????
-------------------------------------
Its Vice President Finance and
Administration
Address: 329 Bath Road
Brunswick, ME 04011
CENTRAL MAINE POWER COMPANY
By ?????????????
-------------------------------------
Its President and Chief Executive
Officer
Address: 83 Edison Drive
Angusta, ME 04336
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<PAGE> 57
Appendix A to
1997 Amendatory Agreement
-------------------------
MAXIMUM AMORTIZATION SCHEDULE
If the event occurs during the calendar year: Maximum Amortization Accrual:(2)
1998 $______________
1999 $______________
2000 $______________
2001 $______________
2002 $______________
2003 $______________
2004 $______________
2005 $______________
2006 $______________
2007 $______________
2008 $______________
---------------------
(2) This column will reflect the maximum amount scheduled to be outstanding
during the applicable period, and will be completed as part of the satisfactory
work-out with lender banks and insurance companies.
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<PAGE> 58
EXHIBIT A-2
MAINE YANKEE ARTICLES OF INCORPORATION
<PAGE> 59
STATE OF MAINE
CERTIFICATE OF ORGANIZATION OF A CORPORATION
UNDER THE GENERAL LAW
--------------------------------------------
The undersigned, officers of a corporation organized at Augusta, Maine, at
a meeting of the signers of the articles of agreement therefor, duly called and
held at the offices of Central Maine Power Company, 9 Green Street, in the City
of Augusta, Maine, on the 3rd day of January, A.D. 1966, hereby certify as
follows:
The name of said corporation is MAINE YANKEE ATOMIC POWER COMPANY.
The purposes of said corporation are:
1. To construct and operate in the State of Maine properties and
facilities to make and generate electricity, including electricity generated
from nuclear or atomic energy or from steam or other energy produced by nuclear
or atomic fuels, and to transmit, distribute, supply and sell electricity to
other electric utilities doing business within or outside of the State of Maine
and which are stockholders of the corporation.
2. To do any and all things incidental to or expedient for the attainment
of the foregoing including without limitation: (a) to purchase, lease and
otherwise acquire, improve, operate and otherwise deal in and with real and
personal property, or any interest therein, wherever situated; (b) to sell,
lease and otherwise dispose of all or any of its property, or any interest
therein; and (c) to make contracts, conduct research, give guaranties in
connection with transactions in which it has an interest, incur liabilities,
invest its funds, borrow money, issue its notes, bonds and other obligations,
and secure any of its obligations by mortgage, pledge or encumbrance of, or
security interest in, all or any of its property, including any franchise or
permit or any right thereunder, or any interest therein.
<PAGE> 60
The amount of capital stock is $2,000,000 divided into 20,000 shares of common
stock, $100 par value.
The amount of common stock is $2,000,000 divided into 20,000 shares, $100 par
value.
The amount of preferred stock is none.
The amount of capital stock already paid in is $300.
The par value of the shares is $100 per share.
The names and addresses of the owners of said shares are as follows:
Names Addresses No. of Shares
----- --------- -------------
William H. Dunham Manchester, Maine 1
Robert N. Haskell Bangor, Maine 1
C. Hazen Stetson Presque Isle, Maine 1
Said corporation is located at Augusta in the County of Kennebec.
The number of directors is not less than three nor more than seventeen, the
exact number to be fixed by the stockholders from time to time; the initial
number being fixed at three and their names are: William H. Dunham, Robert N.
Haskell and C. Hazen Stetson.
The name of the clerk is Joseph P. Gorham and his residence is Manchester,
Maine.
<PAGE> 61
The undersigned, William H. Dunham, is president; the undersigned, Robert N.
Haskell of Bangor, Maine, is Treasurer; and the undersigned, William H. Dunham,
Robert N. Haskell and C. Hazen Stetson, are all of the directors of said
corporation.
Witness our hands this 3rd day of January, A.D. 1966.
/s/ William H. Dunham President.
---------------------
/s/ Robert N. Haskell Treasurer.
---------------------
/s/ William H. Dunham
---------------------
/s/ Robert N. Haskell Directors.
---------------------
/s/ C. Hazen Stetson
---------------------
KENNEBEC, SS. January 3, A.D. 1966
Then personally appeared William H. Dunham, Robert N. Haskell and C. Hazen
Stetson and severally made oath to the foregoing certificate, that the same is
true.
Before me,
/s/ Joseph P. Gorham
-------------------------------
Justice of the Peace
<PAGE> 62
STATE OF MAINE
--------------
Attorney General's Office, January 3 A.D. 1966
I hereby certify that I have examined the foregoing certificate, and the
same is properly drawn and signed, and is conformable to the constitution and
laws of the State.
George C. West
Deputy Attorney General
Kennebec ss;
Registry of Deeds.
Received January 3, 1966
at 9H30M.A.M.
recorded in Vol. 1391 Page 155
ATTEST:
Edna Weeks Van Strien
Register
A True copy of record.
ATTEST:
/s/ Edna Weeks Van Strien
-------------------------
Register
<PAGE> 63
STATE OF MAINE
Office of Secretary of State
Augusta, Jan. 3, 1966
Received and filed this day.
ATTEST:
/s/ Illegible Signature
-------------------------------
Secretary of State
Recorded in Vol. 198 Page 94
<PAGE> 64
I, Joseph P. Gorham of Manchester, County of Kennebec and State of Maine,
Clerk of Maine Yankee Atomic Power Company, hereby certify that at a Special
Meeting of the Stockholders of said corporation, held at 9 Green Street,
Augusta, Maine, on Monday, June 5, 1967, at 11 o'clock in the forenoon, Eastern
Daylight Time, the authorized Capital Stock of the corporation was increased
from $2,000,000, consisting of 20,000 shares of Common Stock, $100 par value, to
$10,000,000, consisting of 100,000 shares of Common Stock, $100 par value.
I further certify that said Special Meeting was duly called and held in
accordance with the By-Laws of the corporation.
I further certify that the following is a true copy of the vote of the
stockholders of Maine Yankee Atomic Power Company adopted at said Special
Meeting authorizing such increase:
"VOTED: to increase the authorized Capital Stock of the corporation from
$2,000,000, consisting of 20,000 shares of Common Stock, $100 par
value, to $10,000,000, consisting of 100,000 shares of Common
Stock, $100 par value; and to amend the Certificate of
Organization of the corporation by striking out all statements
therein contained as to the amount of Capital Stock and the amount
of Common Stock and by substituting therefor the following:
'The amount of Capital Stock is $10,000,000 divided into
100,000 shares of Common Stock, $100 par value.'; and
that the Clerk of the corporation is authorized to execute and
file such certificate as may be required by Section 201 of Title
13 of the Maine Revised Statutes Annotated, in order to give
effect to the foregoing increase in the authorized Capital Stock
of the corporation."
WITNESS my hand and the seal of Maine Yankee Atomic Power Company.
(CORPORATE
SEAL) /s/ Joseph P. Gorham
--------------------
Augusta, Maine Clerk
June 5, 1967
<PAGE> 65
MAINE YANKEE ATOMIC POWER COMPANY
Increase in Authorized Capital
Vol. 198 Page 94
STATE OF MAINE
Office of Secretary of State
Augusta, June 5, 1967
Received and filed this day.
ATTEST:
/s/ Illegible Signature
---------------------------
Secretary of State
Recorded in Vol. 55 Page 252-253
<PAGE> 66
I, Seward B. Brewster of Manchester, County of Kennebec and State of Maine,
Assistant Secretary of Maine Yankee Atomic Power Company, hereby certify that at
a Special Meeting in Place of the Annual Meeting of the Stockholders of said
Corporation, held at 9 Green Street, Augusta, Maine, on Wednesday, June 12,
1968, at 11 o'clock in the forenoon, Eastern Daylight Time, the authorized
Capital Stock of the Corporation was increased from $10,000,000, consisting of
100,000 shares of Common Stock, $100 par value, to $50,000,000, consisting of
500,000 shares of Common Stock, $100 par value.
I further certify that said Special Meeting was duly called and held in
accordance with the By-Laws of the Corporation.
I further certify that the following is a true copy of the vote of the
stockholders of Maine Yankee Atomic Power Company adopted at said Special
Meeting authorizing such increase:
"VOTED: to increase the authorized Capital Stock of the Corporation from
$10,000,000, consisting of 100,000 shares of Common Stock, $100
par value, to $50,000,000, consisting of 500,000 shares of Common
Stock, $100 par value; and to amend the Certificate of
Organization of the Corporation by striking out all statements
therein contained as to the amount of Capital Stock and the amount
of Common Stock and by substituting therefor the following:
'The amount of Capital Stock is $50,000,000 divided into
500,000 shares of Common Stock, $100 par value.'; and
that the Assistant Secretary of the Corporation is authorized to
execute and file such certificate as may be required by Section
201 of Title 13 of the Maine Revised Statutes Annotated, in order
to give effect to the foregoing increase in the authorized Capital
Stock of the Corporation."
WITNESS my hand and the seal of Maine Yankee Atomic Power Company.
(Corporate
Seal) /s/ Seward B. Brewster
------------------------------
Assistant Secretary
Augusta, Maine
June 12, 1968
<PAGE> 67
MAINE YANKEE ATOMIC POWER COMPANY
Increase in Authorized Capital
Vol. 198 Page 94
MAINE YANKEE ATOMIC POWER COMPANY
INCREASE IN CAPITAL STOCK
STATE OF MAINE
Office of Secretary of State
Augusta, July 1, 1968
Received and filed this day.
ATTEST:
/s/ Illegible Signature
----------------------------
Deputy Secretary of State
Recorded in Vol. 58 Page 169-170
<PAGE> 68
I, Seward B. Brewster, of Manchester, County of Kennebec and State of
Maine, Secretary of Maine Yankee Atomic Power Company, hereby certify that at a
Special Meeting of Stockholders of said Corporation, held at 9 Green Street,
Augusta, Maine, on Friday, October 2, 1970, at ten o'clock in the forenoon,
Eastern Daylight Time, the authorized Capital Stock of the Corporation was
increased from $50,000,000, consisting of 500,000 shares of Common Stock, $100
par value, to $67,000,000, consisting of said Common Stock and 170,000 shares of
Preferred Stock, $100 par value.
I further certify that said Special Meeting was duly called and held in
accordance with the By-Laws of the Corporation.
I further certify that the following is a true copy of the votes of the
Stockholders of Maine Yankee Atomic Power Company adopted at said Special
Meeting authorizing such increase:
"VOTED: to increase the authorized Capital Stock of this Company from
$50,000,000, consisting of 500,000 shares of Common Stock, $100
par value, to $67,000,000, consisting of said Common Stock and
170,000 shares of Preferred Stock, $100 par value.
VOTED: to amend the Certificate of Organization of this Corporation, as
heretofore amended, by striking out all statements therein
contained as to the amount, classes and par value of the Capital
Stock and by substituting therefor the following:
'The number of shares of Capital Stock that may be issued by
the Corporation is, in classes, as follows:
170,000 shares of Preferred Stock, $100 par value; and
500,000 shares of Common Stock, $100 par value.'
<PAGE> 69
VOTED: that the Secretary and each Assistant Secretary of this Company is
authorized to execute and file such certificate as may be required
by Section 201 of Title 13 of the Maine Revised Statutes Annotated
in order to give effect to the foregoing increase in the
authorized Capital Stock of this Company."
WITNESS my hand and the seal of Maine Yankee Atomic Power Company.
(Corporate
Seal) /s/ Seward B. Brewster
-----------------------------
Secretary
Augusta, Maine
October 2, 1970
<PAGE> 70
MAINE YANKEE ATOMIC POWER COMPANY
Increase Authorized Capital
Vol. 198 Page 94
STATE OF MAINE
Office of Secretary of State
Augusta Oct. 2, 1970
Recorded and filed this day.
ATTEST
/s/ Illegible Signature
--------------------------
Deputy Secretary of State
Recorded in Vol. 65 Page 481-483
<PAGE> 71
STATE OF MAINE
ARTICLES OF AMENDMENT
(Amendment by Shareholders
Voting as One Class)
OF
MAINE YANKEE ATOMIC POWER COMPANY
Filing Fee (See Sec. 1401)
For Use By The Secretary of State
File No. 198-94
----------------
Fee Paid $5.00
---------------
C.B. 295
--------------------
Date. 12-29-72
-------------------
This Space For Use By Secretary of State
MAINE SECRETARY OF STATE FILED
December 29, 1972
Peter M. Neuborg
---------------------
AGENT
Pursuant to 13-A MRSA ss.805 and 807, the undersigned corporation adopts these
Articles of Amendment.
FIRST: All outstanding shares of the corporation were entitled to vote on
the following amendment as one class.
SECOND: The amendment to the Articles of Incorporation of the corporation
set out in Exhibit A attached hereto was adopted by the shareholders thereof at
a meeting legally called and held on December 20, 1972.
THIRD: On said date, the number of shares outstanding and entitled to
vote on such amendment, and the number of shares voted for and against said
amendment, respectively, were as follows:
Number of shares Outstanding
and Entitled to Vote Voted For Voted Against
---------------------------- --------- -------------
500,000 Shares of 500,000 Shares None
Common Stock
---------------------- ------------ -------------
Totals 500,000 500,000 None
FOURTH: If such amendment provides for exchange, reclassification or
cancellation of issued shares, the manner in which the same shall be effected is
contained in Exhibit B attached hereto, if it is not set forth in the amendment
itself.
Inapplicable.
*FIFTH: If such amendment effects a change in the number or par values of
authorized shares the number of shares which the corporation has authority to
issue after giving effect to such amendment is as follows:
Series Number Par Value
Class (If Any) of Shares (If Any)
----- -------- --------- ---------
Common Stock 500,000 $100
Cumulative Preferred To be established 170,000 $100
Stock by directors
The aggregate par value of all such shares (of all classes and series) HAVING
PAR VALUE is $67,000,000.
The total number of all such shares (of all classes and series) WITHOUT PAR
VALUE is None shares.
<PAGE> 72
SIXTH: The address of the registered office of the corporation in the
State of Maine is 9 Green Street, Augusta, Maine 04330.
------------------------------------
(street, city and zip code)
Dated: December 27, 1972
Maine Yankee Atomic Power Company **
Legibly print or type name ---------------------------------
and capacity of all signers (name of corporation)
13-A MRSA Section 104. By /s/ Seward B. Brewster
-------------------------------
(type or print name and capacity)
I certify that I have custody of the Seward B. Brewster, Clerk
minutes showing the above action by -------------------------------
the shareholders. By
-------------------------------
/s/ Seward B. Brewster
------------------------------------ -------------------------------
Seward B. Brewster (type or print name and capacity)
NOTE: This form should not be used if any class of shares entitled to vote as a
separate class for any of the reasons set out in Section 806, or because
the articles so provide. For vote necessary for adoption see Section 805.
-------------------------------------------
* To be completed only if Exhibit A or B do not give this required
information.
** The name of the corporation should be typed, and the document must be
signed by (1) the Clerk OR (2) by the president or a vice-president and by
the Secretary or an assistant secretary or such other officer as the bylaws
may designate as a second certifying officer or (3) if there are no such
officers, then by a majority of the directors or by such directors, as may
be designated by a majority of directors then in office or (4) if there are
no such directors, then by the holders, or such of them as may be
designated by the holders, of record of a majority of all outstanding
shares entitled to vote thereon or (5) by the holders of all of the
outstanding shares of the corporation.
FORM NO. MCBA-9
<PAGE> 73
EXHIBIT A
VOTED: To amend the Articles of Incorporation (formerly called Certificate of
Organization) of Maine Yankee Atomic Power Company, as heretofore
amended, by striking out all provisions therein relating to the Capital
Stock and by substituting therefor the following provisions, to wit:
CAPITAL STOCK PROVISIONS
This Corporation shall have two classes of shares to be known as "Common
Stock" and "Cumulative Preferred Stock".
The par value of each share of Common Stock shall be $100 and the number
of shares of Common Stock which the Corporation shall have authority to issue
shall be 500,000 shares.
The par value of each share of Cumulative Preferred Stock shall be $100,
and the number of shares of Cumulative Preferred Stock which the Corporation
shall have the authority to issue shall be 170,000.
The Corporation's Cumulative Preferred Stock and Common Stock shall have
the following designations, relative rights, preferences and limitations:
1. DESIGNATION OF CUMULATIVE PREFERRED STOCK. The shares of the Cumulative
Preferred Stock shall be of the par value of $100 each and may be issued, as
the Board of Directors may determine, in one or more series designated
"Cumulative Preferred Stock, $ [or %] Series" (inserting in each case the
amount or rate of the annual dividend as determined by the Board of Directors
for each series).
2. DIFFERENT SERIES OF CUMULATIVE PREFERRED STOCK. All shares of the
Cumulative Preferred Stock, irrespective of series, shall constitute one and
the same class of stock, shall be of equal rank and shall be identical in all
respects, except as to the designation thereof and except that the Board of
Directors of the Corporation is expressly vested with the authority to
establish, designate, fix and determine the relative rights, preferences and
limitations of different series of the Cumulative Preferred Stock, and the
number of shares of each such series, to the extent not inconsistent herewith,
as to:
A. the rate of dividend;
B. the redemption price or prices and the terms and conditions of
redemption;
C. the amount payable upon shares in event of voluntary and involuntary
liquidation;
<PAGE> 74
D. sinking fund provisions, if any, for the redemption or purchase of
shares; and
E. the terms and conditions, if any, on which shares may be converted.
All shares of the same series shall be identical in all respects.
3. DIVIDENDS. Holders of shares of the Cumulative Preferred Stock shall be
entitled to receive, but only when and as declared by the Board of Directors out
of funds legally available for the declaration and payment of dividends,
cumulative dividends at the annual dividend rate per share fixed for the
particular series, and no more, payable in cash quarterly on the first day of
January, April, July and October in each year, commencing on the first such date
following the date of issue of such shares, to stockholders of record on the
respective dates fixed in advance for the purpose of the Board of Directors
prior to the payment of each such dividend, which record date for each dividend
shall be the same for all series, before any dividends on, or distribution of
assets (by purchase or redemption of shares or otherwise) to holders of, the
Common Stock, shall be declared or paid or set apart for payment.
Dividends on shares of the Cumulative Preferred Stock shall be cumulative:
(1) on shares of any series issued prior to the first dividend payment date for
shares of such series, from the date of issue of such shares; (2) on shares of
any series issued on or after such first dividend payment date for shares of
such series, from the quarterly dividend payment date next preceding the date of
issue of such shares or from the date of issue if that be a dividend payment
date.
No dividend shall be declared on any series of the Cumulative Preferred
Stock, or on any other class of preferred stock ranking on a parity with the
Cumulative Preferred Stock as to dividends, for any quarterly dividend period,
unless there shall likewise be declared on all shares of all series of the
Cumulative Preferred Stock and of any such parity preferred stock at the time
outstanding, like proportionate dividends, ratably, in proportion to the
respective annual dividend rates fixed therefor, for the same quarterly
dividend period, to the extent that such shares are entitled to receive
dividends for such quarterly period.
Whatever dividends accrued on all outstanding shares of the Cumulative
Preferred Stock to the next succeeding quarterly dividend payment date shall
have been paid in full or declared and set apart for payment, the Board of
Directors may declare and pay dividends on the Common Stock out of funds
legally available therefor, subject, however, to the limitation contained in
Sections 7 and 10 of these Capital Stock Provisions.
-2-
<PAGE> 75
Accumulation of dividends on any shares of the Cumulative Preferred Stock
shall not bear interest.
The expression "dividends accrued", as used herein, shall mean the sum of
amounts in respect of all shares of the Cumulative Preferred Stock then
outstanding which, as to each share, shall be an amount computed at the
dividend rate per annum fixed for the particular share from the date from which
dividends on such share became cumulative to the date with reference to which
the expression is used, irrespective of whether such amount or any part thereof
shall have been declared as dividends or there shall have existed any funds
legally available for the declaration and payment thereof, less the aggregate
of all dividends paid on such share.
4. REDEMPTION OF CUMULATIVE PREFERRED STOCK. The Corporation shall have the
right, at its option and by resolution of its Board of Directors, to redeem any
series of the Cumulative Preferred Stock, as a whole or in part from time to
time, upon the terms and conditions fixed and determined for such series by the
Board of Directors in its resolution establishing and designating such series,
upon payment in cash, in respect of each such share redeemed, of the applicable
redemption price for the shares of the particular series, which shall include
dividends accrued thereon to the date fixed for redemption, and by mailing,
postage prepaid, at least thirty (30) days and not more than fifty (50) days
prior to the date fixed for said redemption, a notice specifying said redemption
date to the holders of record of the shares of Cumulative Preferred Stock to be
redeemed, at their respective addresses as the same shall appear on the books of
the Corporation. The particular shares to be redeemed shall be selected in
accordance with such method as the Board of Directors may determine.
If such notice of redemption shall have been so mailed, and if on or
before the redemption date specified in such notice all funds necessary for
such redemption shall have been set aside by the Corporation, separate and
apart from its other funds, in trust for the account of the holders of the
shares so to be redeemed, so as to be and continue to be available therefor,
then, on and after said redemption date, notwithstanding that any certificate
for shares of the Cumulative Preferred Stock so called for redemption shall not
have been surrendered for cancellation, the shares called for redemption shall
no longer be deemed outstanding, the right to receive dividends thereon shall
cease to accrue, and all rights with respect to such shares of the Cumulative
Preferred Stock so called for redemption shall forthwith cease and terminate,
except only the right of the holders thereof to receive, out of the funds so
set aside in trust, the amount payable on redemption thereof, but without
interest. However, if at the time of or after mailing said notice as aforesaid
and prior to the date of redemption specified in
-3-
<PAGE> 76
such notice, said funds shall be set aside by deposit in trust, for the account
of the holders of the Cumulative Preferred Stock to be redeemed (and so as to be
and continue to be available therefor), thereupon all shares of the Cumulative
Preferred Stock with respect to which such deposit shall have been made shall
no longer be deemed to be outstanding and all rights with respect to such
shares of the Cumulative Preferred Stock shall forthwith upon such deposit in
trust cease and terminate, except only the right of the holders thereof to
receive from such deposit the amount payable on the redemption thereof, but
without interest.
If less than all the shares representing by a particular certificate are
to be redeemed, after surrender and cancellation of said certificate, a new
certificate or certificates shall be issued representing the unredeemed shares.
If the holders of shares of the Cumulative Preferred Stock which shall
have been redeemed shall not within four (4) years after the redemption date
claim any amount so deposited in trust for the redemption of such shares, the
trustee shall, upon demand, pay over to the Corporation any such unclaimed
amount so deposited with it, and shall thereupon be relieved of all
responsibility in respect thereof, and the Corporation shall not be required to
hold the amount so paid over to it separate and apart from its other funds, and
thereafter the holders of such shares shall look only to the Corporation for
payment of the redemption price thereof, but without interest.
If at any time the Corporation shall have failed to declare and pay or set
apart for payment dividends in full upon the Cumulative Preferred Stock of all
series for all past quarterly dividend periods, thereafter and until all such
dividends shall have been paid in full or declared and set apart for payment,
the Corporation shall not redeem, purchase or otherwise acquire for any
purpose, any shares of the Cumulative Preferred Stock of any series, unless all
shares of the Cumulative Preferred Stock of all series then outstanding shall
be redeemed, or unless approval is obtained from the Securities and Exchange
Commission under the Public Utility Holding Company Act of 1935 or from any
successor regulatory authority.
All shares of the Cumulative Preferred Stock redeemed or used by the
Corporation to satisfy any sinking or purchase fund shall be retired and
thereupon shall automatically be restored to the status of authorized by
unissued shares.
-4-
<PAGE> 77
5. LIQUIDATION. In the event of any liquidation, dissolution or winding up
(whether voluntary or involuntary) of the affairs of the Corporation, then the
holders of each series of the Cumulative Preferred Stock at the time
outstanding shall be entitled to be paid in cash the amount fixed for the
particular series, which shall include dividends accrued thereon to the date
fixed for payment of such amount, and no more, before any such distribution or
payment shall be made to the holders of the Common Stock.
No payments on account of such amount shall be made to the holders of any
series of the Cumulative Preferred Stock, or any other preferred stock ranking
on a parity with the Cumulative Preferred Stock as to the distribution of
assets, unless there shall likewise be paid at the same time to the holders of
each other series of the Cumulative Preferred Stock or such parity stock
amounts, ratably, in proportion to the full amounts to which they are
respectively entitled.
After such payment to the holders of the Cumulative Preferred Stock and
any such parity stock, the remaining assets and funds of the Corporation shall
be distributed among the holders of the Common Stock.
Neither the consolidation nor merger of the Corporation with or into any
other corporation or corporations, nor the sale or transfer by the Corporation
of all or any part of its assets, nor the redemption or retirement by the
Corporation of less than all its Common Stock to the extent permitted by
Section 8 of these Capital Stock Provisions, shall be deemed a liquidation,
dissolution or winding up of the affairs of the Corporation within the meaning
of this Section 5.
6. VOTING RIGHTS. Except as provided in these Capital Stock Provisions,
holders of the Cumulative Preferred Stock shall have no right to be represented
at or to receive notice of meetings of the stockholders and shall have no right
to vote for the election of Directors or for any other purpose or on any other
subject. Whenever a vote of the Cumulative Preferred Stock may be required for
any purpose, the shares voting, if of different series, shall be counted
irrespective of series and not by different series, except as otherwise
provided in these Capital Stock Provisions.
Whenever dividends accrued on any shares of any series of the Cumulative
Preferred Stock at the time outstanding shall equal or exceed an amount
equivalent to four (4) full quarterly dividends thereon, holders of the
Cumulative Preferred Stock shall have the right to be represented at and to
receive notice of any meeting of
-5-
<PAGE> 78
the stockholders of the Corporation held for the purpose of electing Directors
and the exclusive right, voting separately as a single class, to elect the
smallest number of Directors which will constitute a majority of the full Board
of Directors; and the remaining Directors shall be elected by the holders of
Common Stock. Such rights shall terminate if and when all dividends in
default on the Cumulative Preferred Stock shall have been paid in full or
declared and set apart for payment, until such time as there shall be a further
like default or defaults.
Such dividends in default shall be declared and paid as soon as reasonably
practicable unless payment thereof is prevented by law or by the provisions of
any indenture or agreement to which the Corporation is a party or by which it
is bound.
At any time when the right to vote for Directors shall accrue to holders
of the Cumulative Preferred Stock as herein provided, a meeting of
stockholders, if not otherwise called, shall be called by the Clerk of the
Corporation, or may be called by the holders of record of at least two percent
(2%) of all shares of Cumulative Preferred Stock then outstanding, for the
purpose of electing (and if necessary increasing the number of) Directors, to
be held on a date not less than forty-five (45) days nor more than ninety (90)
days after the accrual of such right. If at the time of any such meeting
there shall not exist sufficient vacancies in the office of Director so as to
permit the holders of the Cumulative Preferred Stock to elect a majority of the
Directors of the Corporation, the holders of the Cumulative Preferred Stock,
voting separately as a single class, shall have the exclusive right to increase
the number of Directors to such number as will permit the holders of the
Cumulative Preferred Stock to elect a majority of the full Board of Directors.
However, at the next meeting of stockholders of the Corporation at which
Directors are elected, the number of Directors shall, without further vote of
the holders of any class of stock of the Corporation, be reduced to the number
in effect immediately prior to such increase and the holders of the Cumulative
Preferred Stock shall, so long as they have the right to vote for Directors as
herein provided, elect the smallest number of Directors which will constitute a
majority of such reduced number of Directors.
When all dividends in default on the Cumulative Preferred Stock shall have
been paid in full, each Director elected by the holders of the Cumulative
Preferred Stock shall cease to hold office upon the election of a new Board of
Directors by the stockholders then entitled to vote for Directors at a meeting
of stockholders which, if not otherwise called, shall be called by the Clerk of
the Corporation upon request of, or may be called by, one or more of the
Directors then in office.
-6-
<PAGE> 79
If the event calling for any election of Directors as provided for herein
shall occur not more than ninety (90) days and not less than forty-five (45)
days before the date for an annual meeting of the stockholders, the election of
Directors shall be held at such annual meeting, but otherwise at a special
meeting of the stockholders to be called for the purpose.
Notice of every meeting of the stockholders held for the election of
Directors during a period when the holders of the Cumulative Preferred Stock
have the right to vote for the election of Directors shall be given to the
holders of record of the Cumulative Preferred Stock and of Common Stock and
shall state the purpose of the meeting in respect of the election of Directors
representing the different classes of stock.
At each such meeting 33 1/3% of the outstanding shares of the Cumulative
Preferred Stock shall be required to constitute a quorum for the election of
Directors by the Cumulative Preferred Stock and a majority of the outstanding
shares of the Common Stock shall be required to constitute a quorum for the
election of Directors by the Common Stock.
If for lack of a quorum or for any other reason, at any meeting at which
holders of the Cumulative Preferred Stock have the right to elect Directors,
such holders or the holders of the Common Stock shall not elect the number of
Directors they are entitled to elect, the holders of the other class or classes
of stock, provided they have elected the number of Directors they are entitled
to elect, may also elect such additional Directors as are necessary to
constitute the full Board, but no person shall be so elected as an additional
Director except a Director in office at the time of the meeting who had been
elected by the class of stock failing to exercise its voting rights so long as
any such Director in office is available for such election.
In case of any vacancy in the office of a Director elected by the holders
of a particular class of stock, the remaining Directors elected by the holders
of that class, by vote of a majority thereof, or the remaining Director so
elected if there be only one, may fill the vacancy by the election of a
successor to hold office for the unexpired term of such Director.
7. LIMITATION ON DIVIDENDS ON COMMON STOCK. So long as any shares of the
Cumulative Preferred Stock are outstanding, the right of the Corporation to pay
or declare any dividends on the Common Stock (other than dividends payable in
Common Stock) or to make any distribution on any shares of the Common Stock
(each and all of such actions being hereinafter referred to as "dividends on
-7-
<PAGE> 80
Common Stock"), shall be subject to the provisions of Sections 3 and 10 of
these Capital Stock Provisions and to the following further limitations:
(a) If the Common Stock Equity (as hereinafter defined) at the end of the
calendar month immediately preceding the date on which a dividend on
Common Stock is declared, reduced by the amount of such dividend, is
less than 20% of Total Capitalization (as hereinafter defined), the
Corporation shall not declare dividends on Common Stock in an amount
which, together with all other dividends on Common Stock paid within
the year ending with and including the date on which such dividend is
payable, exceeds 50% of the Net Income Available for Dividends on
Common Stock (as hereinafter defined) for the twelve consecutive
calendar months immediately preceding the calendar month in which such
dividend is declared; and
(b) If the Common Stock Equity at the end of the calendar month immediately
preceding the date on which a dividend on Common Stock is declared,
reduced by the amount of such dividend, is less than 25% but is 20% or
more of Total Capitalization, the Corporation shall not declare
dividends on Common Stock in an amount which, together with all other
dividends on Common Stock paid within the year ending with and
including the date on which such dividend is payable, exceeds 75% of
the Net Income Available for Dividends on Common Stock for the twelve
consecutive calendar months immediately preceding the calendar month in
which such dividend is declared.
For the purposes of this Section 7:
Total Capitalization shall be the sum of (a) the principal amount of all
outstanding indebtedness of the Corporation represented by bonds, notes and
other evidences of indebtedness maturing by their terms more than one year from
the date of issue thereof, (b) the aggregate amount of the par or stated capital
represented by, and any premiums in respect of, all issued and outstanding
capital stock of all classes of the Corporation having preference as to
dividends or as to distribution of assets over the Common Stock and (c) the
Common Stock Equity of the Corporation.
-8-
<PAGE> 81
Common Stock Equity shall be the sum of the amount of the par or stated
capital represented by all outstanding Common Stock, including premiums on
Common Stock, and the surplus (including earned, paid-in, capital, or
contributed surplus and the balance of any investment tax credit being
amortized) of the Corporation, less (a) any intangible items set forth on the
asset side of the balance sheet of the Corporation, such as unamortized debt
discount and expense, unamortized extraordinary property losses, and capital
stock discount and expense, (b) the excess, if any, of the aggregate amount
payable on involuntary dissolution, liquidation or winding up of the
Corporation's affairs, on all outstanding shares of the Corporation having a
preference as to dividends or as to the distribution of assets over the Common
Stock, over the sum of the aggregate amount of par or stated capital represented
by such outstanding shares and any premiums thereon, and (c) the amount by which
any electric plant adjustments exceed any reserves provided therefor; provided
that no deduction shall be made in the determination of Common Stock Equity for
any of the amounts or items referred to in clauses (a) or (c) of this Section
which are, at the time of the determination of the Common Stock Equity, being
amortized or are provided for by reserves.
Net Income Available for Dividends on Common Stock for any period shall be
the net income available for dividends on the Common Stock of the Corporation
for such period, determined in accordance with such system of accounts as may
be prescribed by the Federal Power Commission or any successor regulatory
authority having the same or similar jurisdiction over accounts, or, in the
absence thereof, in accordance with generally accepted accounting practice.
8. REDEEMABILITY OF SHARES OF COMMON STOCK. The Corporation, by resolution
of its Board of Directors, may redeem at any time and from time to time shares
of its Common Stock from among the holders thereof proportionately to their
respective holdings, at a redemption price per share equal to the amount
obtained by dividing the sum of the aggregate par value of the Common Stock then
outstanding plus the capital surplus, including without limitation other paid-in
capital (less any deficit in earned surplus) by the number of shares of Common
Stock outstanding immediately prior to such redemption; provided that (a) the
Common Stock Equity of the Corporation, reduced by the total amount to be paid
for such redemption, shall be not less than thirty (30) percent of the Total
Capitalization of the Corporation, (b) no such redemption shall reduce the
number of shares of Common Stock outstanding to less than 5,000 shares, and (c)
so long as any shares of the Cumulative Preferred Stock are outstanding no such
redemption shall be made unless (i) all dividends payable on all outstanding
shares of the
-9-
<PAGE> 82
Cumulative Preferred Stock on the next succeeding quarterly dividend payment
date have been paid in full or declared and set apart for payment and (ii) all
mandatory sinking or purchase fund payments on the Cumulative Preferred Stock
through the last preceding mandatory redemption or purchase date have been made
or funds therefor set apart for payment. The excess, if any, of the redemption
price per share over the par value of each share of Common Stock so redeemed may
be charged against capital surplus or any other surplus in accordance with
generally accepted accounting principles. The right to make such redemption
shall be subject to the provisions of the last paragraph of Section 10 of these
Capital Stock Provisions to the extent applicable. The terms "Common Stock
Equity" and "Total Capitalization" are used in this Section 8 with the meanings
defined in Section 7 of these Capital Stock Provisions.
9. LIMITATION AS TO DEBT ISSUANCE: MERGER, CONSOLIDATION OR DISPOSITION OF
ASSETS. So long as any shares of the Cumulative Preferred Stock are outstanding,
the Corporation shall not, except upon the affirmative vote at a meeting called
for that purpose of the holders of a majority of the outstanding shares of the
Cumulative Preferred Stock, voting as a single class:
(a) Issue or assume any unsecured notes, debentures or other
securities representing unsecured indebtedness for purposes other than the
refunding of outstanding unsecured debt securities theretofore issued or
assumed by the Corporation resulting in equal or longer maturities than the
maturities of the indebtedness being refunded or the redemption or other
retirement of all outstanding shares of the Cumulative Preferred Stock, if,
immediately after such issue or assumption,
(i) the total principal amount of all such unsecured notes,
debentures or other securities representing unsecured indebtedness
issued or assumed by the Corporation and then outstanding (including
the unsecured securities then to be issued or assumed), would exceed
20% of the total sum of (x) the total principal amount of all bonds,
other securities and obligations representing secured indebtedness
issued or assumed by the Corporation and then to be outstanding
(including indebtedness with respect to nuclear fuel secured by a lien
on or other security interest in the fuel or other property of the
Corporation or by the pledging of any rights or interests of the
Corporation under its Power Contracts and Capital Funds Agreements with
its stockholders dated as of May 20, 1968 as the same may be amended
from time to time), and (y) the capital stock, premiums and surplus of
the Corporation as stated on its books, or
(ii) the total principal amount of all such unsecured notes,
debentures or other securities representing unsecured
-10-
<PAGE> 83
indebtedness issued or assumed by the Corporation and then outstanding
(including the unsecured securities then to be issued or assumed),
having maturities of less than 10 years will thereby exceed 10% of the
total sum of the items set forth in clauses (x) and (y) above.
For purposes of (ii) above the payment due upon the maturity of unsecured
debt having an original single maturity in excess of 10 years or the
payment due upon the final maturity of any unsecured serial debt which had
original maturities in excess of 10 years shall not be regarded as
unsecured debt of a maturity of less than 10 years until such payment shall
be required to be made within 3 years.
(b) Merge or consolidate with or into any other corporation or
corporations, or sell or otherwise dispose of all or substantially all of
its assets, unless such merger, consolidation, sale or other disposition,
or the issuance and assumptions of all securities to be issued or assumed
in connection therewith, shall have been ordered or approved by the
Securities and Exchange Commission under the Public Utility Holding Company
Act of 1935 or by any successor regulatory authority.
10. LIMITATION ON ISSUANCE OF ADDITIONAL PREFERRED STOCK. So long as any
shares of the Cumulative Preferred Stock are outstanding, the Corporation shall
not:
(a) except upon the affirmative vote at a meeting called for that
purpose of the holders of at least 66 2/3% of the outstanding shares of the
Cumulative Preferred Stock, voting as a single class, authorize any shares
of any preferred stock having a preference as to dividends or as to the
distribution of assets over the Cumulative Preferred Stock, or any
securities convertible into shares of such preferred stock, or issue any
shares of any such preferred stock more than 12 months after the date as of
which the Corporation authorized such preferred stock; or
(b) except upon the affirmative vote at a meeting called for that
purpose of the holders of a majority of the outstanding shares of the
Cumulative Preferred Stock, voting as a single class, issue any shares of
the Cumulative Preferred Stock other than the 170,000 shares of the
Cumulative Preferred Stock initially authorized, or of any shares of any
other class of stock ranking as to dividends or as to the distribution of
assets on a parity with the Cumulative Preferred Stock, or any securities
convertible into shares of the Cumulative Preferred Stock or such other
class of stock, or reissue any reacquired shares of the Cumulative
-11-
<PAGE> 84
Preferred Stock or of such other class of stock, unless (i) such issue
or reissue is for the purpose of refunding of then outstanding shares
of the Cumulative Preferred Stock, or of any other preferred stock
ranking prior to or on a parity with the Cumulative Preferred Stock as
to dividends or as to the distribution of assets (referred to in this
paragraph (b) as the "other preferred stock"), and the par value of the
securities to be issued is in an amount not in excess of the par value
of the Cumulative Preferred Stock or of the other preferred stock so to
be refunded, or (ii) immediately after such issue, the Common Stock
Equity (as defined in Section 7 hereof) is at least equal to the
aggregate amount payable in connection with an involuntary liquidation
of the Corporation with respect to all shares of the Cumulative
Preferred Stock and of the other preferred stock, which will be
outstanding immediately after such issue, and the gross income of the
Corporation (after such issue, and the gross income of the Corporation
(after all taxes including taxes based on income) for a period of 12
consecutive calendar months within the 15 calendar months immediately
preceding the calendar month of issuance of such additional stock, is
at least 1 1/2 times an amount equal to all fixed charges for said
period (including interest and amortization of debt premium, discount
and expense but excluding interest charges on indebtedness to be
retired with the proceeds of such issue) and the annual dividend
requirements on the Cumulative Preferred Stock and the other preferred
stock to be outstanding immediately after such issue.
If for the purposes of meeting the requirements of clause (ii) above, it shall
have been necessary to take into consideration any earned surplus of the
Corporation, the Corporation shall not thereafter pay any dividends on or make
any distributions in respect of, or purchase, redeem or otherwise acquire for
value, Common Stock which would result in reducing the Common Stock Equity to an
amount less than the amount payable on involuntary liquidation of the
Corporation with respect to all shares of the Cumulative Preferred Stock and of
the other preferred stock (as defined in (i) above), at the time outstanding.
11. PREEMPTIVE RIGHTS. None of the holders of shares of any class of the
Capital Stock of the Corporation shall be entitled as such, as a matter of
right, to purchase, subscribe for or otherwise acquire any securities of the
Corporation of any class or any options or warrants to purchase, subscribe for
or otherwise acquire any such securities, or any other securities convertible
into or carrying options or warrants to purchase, subscribe for or otherwise
acquire any such securities, except that each holder of Common Stock shall have
a preemptive right to subscribe to his proportionate share of any increase in
the outstanding Common Stock of the Corporation, and all options or warrants to
purchase, subscribe for or otherwise acquire Common Stock, and all securities
convertible into, or carrying options or warrants to purchase, subscribe for or
otherwise acquire, Common Stock.
-12-
<PAGE> 85
12. AMENDMENTS. So long as any shares of the Cumulative Preferred Stock
are outstanding, the Corporation shall not, by merger, consolidation or
otherwise, except upon the affirmative vote at a meeting called for that purpose
of holders of at least 66 2/3% of the outstanding shares of the Cumulative
Preferred Stock, voting as a single class, amend, alter or repeal any of the
provisions relating to the Cumulative Preferred Stock, or of any series thereof,
so as to affect adversely the relative rights, preferences or limitations of the
holders thereof, provided, however, that (a) if such amendment, alteration or
repeal shall affect adversely the relative rights, preferences or limitations of
the holders of one or more, but not all, series of the Cumulative Preferred
Stock at the time outstanding, only the vote of the holders of at least 66 2/3%
of the outstanding shares of all series so affected and of the holders of at
least 66 2/3% of the outstanding shares of each series which is so affected in a
manner different from any other series, shall be required, (b) no such
amendment, alteration or repeal shall affect the right of the holders of the
Cumulative Preferred Stock to receive cumulative dividends at the rate fixed for
the series of which their respective shares are a part, or to receive payment in
cash of the redemption price or prices fixed for the series of which their
respective shares are a part in the event of redemption, or to receive payment
in cash of the amount fixed for the series of which their respective shares are
a part in the event of either voluntary or involuntary liquidation, dissolution,
or winding up of the affairs of the Corporation, and (c) no amendment to
increase or decrease the authorized amount of the Cumulative Preferred Stock or
to create or authorize, or increase or decrease the amount of, any class of
stock ranking on a parity with the Cumulative Preferred Stock as to dividends or
as to the distribution of assets, shall be deemed to affect adversely the
relative rights, preferences or limitations of the Cumulative Preferred Stock or
any series thereof. The rights granted to the holders of the Cumulative
Preferred Stock under this Section 12 are in addition to any rights to vote on
amendments to the Articles of Incorporation granted by law.
13. ISSUE OF CAPITAL STOCK. Except as otherwise provided by law, shares of
any class or series of Capital Stock of the Corporation when duly authorized may
be issued for such consideration as may be fixed from time to time by the Board
of Directors and upon receipt by the Corporation of the consideration so fixed,
such shares shall be deemed to have been fully paid and shall not be liable to
any further call or assessment.
-13-
<PAGE> 86
STATE OF MAINE
STATEMENT OF RESOLUTION ESTABLISHING SERIES
OF SHARES OF
MAINE YANKEE ATOMIC POWER COMPANY
Filing Fee $5.00
For Use By The Secretary of State
File No. 198-94
----------------
Fee Paid $5.00
----------------
C.B. 317
------------------
Date 1-11-73
-----------------
This Space For Use By Secretary of State MAINE
SECRETARY OF STATE FILED
January 11, 1973
Joseph J. Edgar
Pursuant to 13-A MRSA s.503, the undersigned corporation submits the
following for the purpose of establishing and designating a series of shares
and fixing and determining the relative rights and preferences thereof:
FIRST: The attached resolution establishing and designating the series
and fixing and determining the relative rights and preferences thereof was duly
adopted by the board of directors on January 11, 1973.
SECOND: The Articles expressly grant to the board of directors the
authority to make such a resolution.
THIRD: The address of the registered office of the corporation is:
9 Green Street, Augusta, Maine 04330
-------------------------------------------------------------------------------
(street, city, state and zip code)
Dated: January 11, 1973
------------------------
Maine Yankee Atomic Power Company
---------------------------------
(name of corporation)
By Seward B. Brewster
--------------------------------
legibly print or type name Seward B. Brewster, Clerk
and capacity of all signers --------------------------------
13-A MRSA s.104 (type or print name and capacity)
By
--------------------------------
--------------------------------
(type or print name and capacity)
---------------------
* The name of the corporation should be typed, and the document must be signed
by (1) the Clerk OR (2) by the President or a vice-president and by the
Secretary or an assistant secretary or such other officer as the bylaws may
designate as a second certifying officer or (3) if there are no such officers,
then by a majority of the directors or by such directors as may be designated
by a majority of directors then in office or (4) if there are no such
directors, then by the holders, or such of them as may be designated by the
holders, of record of a majority of all outstanding shares entitled to vote
thereon or (5) by the holders of all of the outstanding shares of the
corporation.
FORM NO. MBCA-7
<PAGE> 87
RESOLVED: that there be and there hereby
is established the first series
of Cumulative Preferred Stock
of this Company; and that the
designation, relative rights,
preferences and limitations
of said series be and they
hereby are established, designated,
fixed and determined as follows:
(1) DESIGNATION AND DIVIDEND RATE. The first series of the Cumulative
Preferred Stock of the Corporation shall be designated "Cumulative Preferred
Stock, 7.48% Series (Sinking Fund)"; the number of authorized shares of such
series which may be issued shall be 150,000; and the annual dividend rate per
share for such shares shall be 7.48% of the par value thereof.
(2) REDEMPTION PRICES. Except as stated in Sections (3) and (4) below,
shares of the Cumulative Preferred Stock, 7.48% Series (Sinking Fund) shall be
redeemable, as a whole or in part from time to time, at the option of the
Corporation at any time, in accordance with the Capital Stock Provisions of the
Corporation's Articles of Incorporation, as amended, at the redemption prices
per share indicated below, plus an amount equal to dividends accrued thereon to
the date fixed for redemption:
PERIOD REDEMPTION PRICE
------ ----------------
On or before December 31, 1977 $108.98
After December 31, 1977 but on
or before December 31, 1982 $107.11
After December 31, 1982 but on
or before December 31, 1987 $105.24
After December 31, 1987 but on
or before December 31, 1992 $103.37
After December 31, 1992 but on
or before December 31, 1997 $101.50
After December 31, 1997 $100.00
<PAGE> 88
No shares of the Cumulative Preferred Stock, 7.48% Series (Sinking Fund),
shall be redeemed at the option of the Corporation prior to January 1, 1978,
directly or indirectly, from the proceeds of or in anticipation of any refunding
operation involving the sale of preferred stock having a dividend cost to the
Corporation (calculated in accordance with generally accepted financial
practices) of less than 7.46% per annum, or involving the incurring of debt
having an interest cost to the Corporation (calculated in accordance with
generally accepted financial practices) of less than 7.46% per annum.
(3) MANDATORY SINKING FUND. The Corporation shall, on January 1, 1978, and
on each January 1 thereafter (each such date being hereinafter referred to as
the "mandatory redemption date"), redeem 6,000 shares of Cumulative Preferred
Stock, 7.48% Series (Sinking Fund), in the manner and with the effect provided
in Section 4 of the Capital Stock Provisions of the Corporation, provided that
the redemption price with respect to each share so redeemed shall be $100 per
share, plus dividends accrued thereon to the mandatory redemption date; and
provided further that no such redemption shall be made if the same would result
in violation of Section 4 of the Capital Stock Provisions of the Corporation.
Any shares of the Cumulative Preferred Stock redeemed by the Corporation in
accordance with Section (2) above or otherwise acquired by the Corporation,
which have not previously been used as a credit against any mandatory sinking
fund redemption, may be credited by the Corporation share for share against any
mandatory sinking fund redemption.
(4) OPTIONAL SINKING FUND. In addition to the redemptions required by
Section (3) above, the Corporation shall have the non-cumulative option to
redeem on each mandatory redemption date (after satisfaction of the mandatory
redemption due on said date), at a price of $100 per share plus dividends
accrued thereon to the mandatory redemption date, not more than 6,000 additional
shares of Cumulative Preferred Stock, 7.48% Series (Sinking Fund), in the manner
and with the effect provided in Section 4 of the Capital Stock Provisions of the
Corporation; provided that no such optional redemption shall be made if the same
would result in violation of Section 4 of the Capital Stock Provisions of the
Corporation.
(5) LIQUIDATION, ETC. The amount payable upon shares of the Cumulative
Preferred Stock, 7.48% Series (Sinking Fund) in the event of any involuntary
liquidation, dissolution or winding up of the affairs of the Corporation shall
be $100 per share plus dividends accrued thereon to the date of distribution.
The amount payable upon shares of the Cumulative Preferred Stock, 7.48% Series
(Sinking Fund) in the event of any voluntary liquidation, dissolution or
winding up of the affairs of the Corporation shall be the applicable redemption
price per share stated in Section (2) above plus dividends accrued thereon to
the date of distribution.
<PAGE> 89
STATE OF MAINE
NOTIFICATION BY CLERK OF
CHANGE IN REGISTERED
OFFICE
For use by the Secretary of State
File No. 198-94
Fee Paid $5.00
C.B. 76C1355
Date 5/5/76
Secretary of State FILED May 5, 1976
/s/ Doris Hayes
---------------
AGENT
Pursuant to 13-A MRSA ss. 304(6), the undersigned clerk for one or more
domestic corporations gives notice of the following change of registered office
of each corporation LISTED IN ITEM FOURTH:
FIRST: Name of clerk* SEWARD B. BREWSTER
------------------------------------------------
SECOND: Address of former registered office 9 Green Street
---------------------------
Augusta, Maine 04330
--------------------------------------------------------------------------------
(street, city, state and zip code)
THIRD: Address of new registered office Edison Drive
------------------------------
Augusta, Maine 04336
--------------------------------------------------------------------------------
(street, city, state and zip code)
FOURTH: Notice of the above change in registered office has been sent
to each of the following corporations by the undersigned as clerk of each:
American Community Services
--------------------------------------------------------------------------------
Central Maine Power Company
--------------------------------------------------------------------------------
Central Securities Corporation
--------------------------------------------------------------------------------
The Corner Store Incorporated
--------------------------------------------------------------------------------
Cumberland Securities Corporation
--------------------------------------------------------------------------------
Ingraham Motors, Inc.
--------------------------------------------------------------------------------
Kennebec Water Power Company
--------------------------------------------------------------------------------
Maine Electric Power Company, Inc.
--------------------------------------------------------------------------------
Maine Yankee Atomic Power Company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Dated April 30, 1976
----------------------- /s/ Seward B. Brewster
--------------------------------
Seward B. Brewster
--------------------------------
(type or print name)
-----------------------------
* The clerk of a domestic corporation must be a natural person
resident of Maine.
<PAGE> 90
STATE OF MAINE
CHANGE OF CLERK OR
REGISTERED OFFICE OR BOTH
Pursuant to 13-A MRSA ss. 304 the undersigned corporation
advises you of the following change(s):
Filing Fee $5.00 ss. 304 (3&5)
For Use By The Secretary of State
File No. 660153D
Fee Paid $5.00
C.B. 850613C
Date 12-11-84
For Use By The Secretary of State FILED November 8, 1984
/s/ Carol E. Hanks
-------------------------
Deputy Secretary of State
A True Copy When Attested by Signature
/s/ L. Evelyn Grover
-------------------------
Deputy Secretary of State
FIRST: The name and registered office of the clerk appearing in the record
in Secretary of State's office
Seward B. Brewster
------------------------------------------------
Edison Drive, Augusta, ME 04336
--------------------------------------------------------------------------------
(street, city, state and zip code)
SECOND: The name and registered office of its successor (new) clerk who
must be a Maine resident
William M. Finn
------------------------------------------------------
Edison Drive, Augusta, ME 04336
--------------------------------------------------------------------------------
(street, city, state and zip code)
THIRD: Upon a change in clerk this must be completed:
(x) Such change was authorized by the board of directors and the
power to make such changes is not reserved to the shareholders
by the articles or the bylaws.
( ) Such change was authorized by the shareholders (Complete the
following)
I certify that I have custody of the minutes showing the
above action by the shareholders.
/s/ William Finn
----------------------------------
(signature of new clerk, secretary
or assistant secretary)
Dated: October 31, 1984
-------------------------------
Maine Yankee Atomic Power Company
----------------------------------
By /s/ William Finn
MUST BE COMPLETED ----------------------------------
Legibly print or type name William M. Finn, Clerk
and capacity of all signers ----------------------------------
13-A MRSA ss. 104. (type or print name and capacity)
By
----------------------------------
(signature)
----------------------------------
(type or print name and capacity)
--------------------------------------
* This document MUST be signed by (1) the CLERK OR (2) by the PRESIDENT
or a vice-president AND by the SECRETARY, an assistant secretary or other
officer the bylaws designate as second certifying officer OR (3) if no such
officers, then by a majority of the DIRECTORS or by such directors designated
by a majority of the directors then in office OR (4) if no directors, then by
the holders, or such of them designated by the HOLDERS, OF RECORD OF A
MAJORITY OF ALL OUTSTANDING SHARES entitled to vote thereon OR (5) by the
HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 91
STATE OF MAINE
CHANGE OF CLERK OR
REGISTERED OFFICE OR BOTH
Pursuant to 13-A MRSA ss. 304 the undersigned corporation
advises you of the following change(s):
Filing Fee $5.00 ss. 304 (3&5)
For Use By The Secretary of State
File No. 19660153D
Fee Paid $5.00
C.B. -----
Date OCT 23 1987
For Use By The Secretary of State FILED June 25, 1987
/s/ ????
-------------------------
Deputy Secretary of State
A True Copy When Attested by Signature
-------------------------
Deputy Secretary of State
FIRST: The name and registered office of the clerk appearing in the record
in Secretary of State's office
William J. Finn
------------------------------------------------
Central Maine Power Company, Edison Drive, Augusta, Maine 04336
--------------------------------------------------------------------------------
(street, city, state and zip code)
SECOND: The name and registered office of its successor (new) clerk who
must be a Maine resident
Peter B. Webster
------------------------------------------------------
Two Canal Plaza, Portland, Maine 04112
--------------------------------------------------------------------------------
(street, city, state and zip code)
THIRD: Upon a change in clerk this must be completed:
(x) Such change was authorized by the board of directors and the
power to make such changes is not reserved to the shareholders
by the articles or the bylaws.
( ) Such change was authorized by the shareholders (Complete the
following)
I certify that I have custody of the minutes showing the
above action by the shareholders.
/s/ Peter B. Webster
----------------------------------
(signature of new clerk)
Dated: June 24, 1987
-------------------------------
Maine Yankee Atomic Power Company
----------------------------------
By /s/ Peter B. Webster
MUST BE COMPLETED ----------------------------------
Legibly print or type name Peter B. Webster, Clerk
and capacity of all signers ----------------------------------
13-A MRSA ss. 104. (type or print name and capacity)
By
----------------------------------
(signature)
----------------------------------
(type or print name and capacity)
--------------------------------------
* This document MUST be signed by (1) the CLERK OR (2) by the PRESIDENT
or a vice-president AND by the SECRETARY, an assistant secretary or other
officer the bylaws designate as second certifying officer OR (3) if no such
officers, then by a majority of the DIRECTORS or by such directors designated
by a majority of the directors then in office OR (4) if no directors, then by
the holders, or such of them designated by the HOLDERS, OF RECORD OF A
MAJORITY OF ALL OUTSTANDING SHARES entitled to vote thereon OR (5) by the
HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 92
STATE OF MAINE
CHANGE OF CLERK OR
REGISTERED OFFICE OR BOTH
Pursuant to 13-A MRSA ss. 304 the undersigned corporation
advises you of the following change(s):
Filing Fee $5.00 ss. 304 (3&5)
For Use By The Secretary of State
File No. 19660153D
Fee Paid $10.00
C.B.____
Date MAR 16 1988
For Use By The Secretary of State FILED February 23, 1988
/s/ [illegible]
-------------------------
Deputy Secretary of State
A True Copy When Attested by Signature
-------------------------
Deputy Secretary of State
FIRST: The name and registered office of the clerk appearing in the record
in Secretary of State's office
Peter B. Webster
--------------------------------------------------------------------------------
Two Canal Plaza, Portland, Maine 04112
--------------------------------------------------------------------------------
(street, city, state and zip code)
SECOND: The name and registered office of its successor (new) clerk who
must be a Maine resident
William M. Finn
--------------------------------------------------------------------------------
Edison Drive, Augusta, Maine 04336
--------------------------------------------------------------------------------
(street, city, state and zip code)
THIRD: Upon a change in clerk this must be completed:
(x) Such change was authorized by the board of directors and the
power to make such changes is not reserved to the shareholders
by the articles or the bylaws.
( ) Such change was authorized by the shareholders (Complete the
following)
I certify that I have custody of the minutes showing the
above action by the shareholders.
/s/ William M. Finn
----------------------------------
(signature of new clerk, secretary
or assistant secretary)
Dated: February 22, 1988
-------------------------------
Maine Yankee Atomic Power Company
----------------------------------
By /s/ William M. Finn
MUST BE COMPLETED ----------------------------------
Legibly print or type name William M. Finn, Clerk
and capacity of all signers ----------------------------------
13-A MRSA ss. 104. (type or print name and capacity)
By
----------------------------------
(signature)
----------------------------------
(type or print name and capacity)
* This document MUST be signed by (1) the Clerk OR (2) by the President
or a vice-president AND by the Secretary, an assistant secretary or other
officer the bylaws designate as second certifying officer OR (3) if no such
officers, then by a majority of the directors or by such directors designated
by a majority of the directors then in office OR (4) if no directors, then by
the holders, or such of them designated by the holders, of record of a
majority of all outstanding shares entitled to vote thereon OR (5) by the
holders of all outstanding shares.
<PAGE> 93
STATE OF MAINE
STATEMENT OF INTENTION
TO DO BUSINESS UNDER
AN ASSUMED NAME
Filing Fee $105.00
For Use By The
Secretary of State
File No. 19660153D
----------------
Fee Paid $105.00
---------------
C.B. ---
--------------------
Date 12-21-90
-------------------
For Use By The Secretary of State
FILED
December 17, 1990
-------------------------
Gary Cooper
-------------------------
Deputy Secretary of State
-------------------------
A True Copy When Attested
By Signature
-------------------------
Deputy Secretary of State
Pursuant to 13-A MRSA s.307, the undersigned, a corporation (incorporated
under the laws of the State of Maine), gives notice of its intention to do
business in this State under an assumed name.
FIRST: The name of the corporation is
Maine Yankee Atomic Power Company
--------------------------------------------------------------
SECOND: The address of the registered office of the corporation in the
State of Maine is
Edison Drive, Augusta, Maine 04330
--------------------------------------------------------------
(street, city, state and zip code)
THIRD: The corporation intends to transact business under the assumed
name of
Maine Yankee
COMPLETE THE FOLLOWING IF APPLICABLE
FOURTH: If such assumed name is to be used at fewer than all of the
corporation's places of business in this State, the location(s)
where it will be used is (are):
N/A
-----------------------------------------------------------------
Dated: December 12, 1990 By /s/ William M. Finn
-------------------------------
(signature)
William M. Finn, Clerk
----------------------------------
(type or print name and capacity)
By -------------------------------
(signature)
----------------------------------
(type or print name and capacity)
---------------------------------------
This document MUST be signed by (1) the CLERK OR (2) the PRESIDENT or a
vice-president AND the SECRETARY, an assistant secretary or other officer the
bylaws designate as second certifying officer OR (3) if no such officers, a
majority of the DIRECTORS or such directors designated by a majority of
directors then in office OR (4) if no directors, the holders, or such of them
designated by the HOLDERS, OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES
entitled to vote thereon OR (5) the HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 94
STATE OF MAINE
STATEMENT OF INTENTION
TO DO BUSINESS UNDER
AN ASSUMED NAME
Filing Fee $105.00
For Use By The
Secretary of State
File No. 19660153D
----------------
Fee Paid $105.00
---------------
C.B. ---
--------------------
Date 12-21-90
-------------------
For Use By The Secretary of State
FILED
December 17, 1990
-------------------------
Gary Cooper
-------------------------
Deputy Secretary of State
-------------------------
A True Copy When Attested
By Signature
-------------------------
Deputy Secretary of State
Pursuant to 13-A MRSA s.307, the undersigned, a corporation (incorporated
under the laws of the State of Maine), gives notice of its intention to do
business in this State under an assumed name.
FIRST: The name of the corporation is
Maine Yankee Atomic Power Company
--------------------------------------------------------------
SECOND: The address of the registered office of the corporation in the
State of Maine is
Edison Drive, Augusta, Maine 04330
--------------------------------------------------------------
(street, city, state and zip code)
THIRD: The corporation intends to transact business under the assumed
name of
Maine Yankee, Inc.
COMPLETE THE FOLLOWING IF APPLICABLE
FOURTH: If such assumed name is to be used at fewer than all of the
corporation's places of business in this State, the location(s)
where it will be used is (are):
N/A
-------------------------------------------------------------------
Dated: December 12, 1990 By /s/ William M. Finn
-------------------------------
(signature)
William M. Finn, Clerk
----------------------------------
(type or print name and capacity)
By -------------------------------
(signature)
----------------------------------
(type or print name and capacity)
---------------------------------------
This document MUST be signed by (1) the CLERK OR (2) the PRESIDENT or a
vice-president AND the SECRETARY, an assistant secretary or other officer the
bylaws designate as second certifying officer OR (3) if no such officers, a
majority of the DIRECTORS or such directors designated by a majority of
directors then in office OR (4) if no directors, the holders, or such of them
designated by the HOLDERS, OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES
entitled to vote thereon OR (5) the HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 95
STATE OF MAINE
ARTICLES OF AMENDMENT
(AMENDMENT BY SHAREHOLDERS VOTING AS ONE CLASS)
Pursuant to 13-A MRSA ss. 805 and 807, the undersigned corporation adopts these
Articles of Amendment:
Filing Fee (See Sec. 1401)
For Use By The Secretary of State
File No. 19660153D
------------
Fee Paid $35.00
------------
C.B. ___
------------
Date April 23, 1992
------------
For Use By The Secretary of State FILED April 17, 1992
/s/ [illegible]
----------------------------------
Deputy Secretary of State
A True Copy When Attested By Signature
/s/ [illegible]
----------------------------------
Deputy Secretary of State
FIRST: All outstanding shares were entitled to vote on the following amendment
as ONE class.
SECOND: The amendment set out in Exhibit A attached was adopted by the
shareholders (Circle one)
A. at a meeting legally called and held on, OR
(B.) by unanimous written consent on April 10,1992.
THIRD: Shares outstanding and entitled to vote and shares voted for and
against said amendment were:
Number of Shares Outstanding NUMBER NUMBER
and Entitled to Vote Voted For Voted Against
---------------------------- --------- -------------
500,000 500,000 0
FOURTH: If such amendment provides for exchange, reclassification or
cancellation of issued shares, the manner in which this shall be
effected is contained in Exhibit B attached if it is not set forth in
the amendment itself.
FIFTH: If the amendment changes the number or par values of authorized shares,
the number of shares the corporation has authority to issue thereafter,
is as follows:
Class Series (If Any) Number of Shares Par Value(if Any)
----- --------------- ---------------- -----------------
The aggregate par value of all such shares (of all classes and series)
HAVING PAR VALUE is $ __________________.
The total number of all such shares (of all classes and series) WITHOUT
PAR VALUE is ______________________ shares.
SIXTH: Address of the registered office in Maine: Edison Drive, Augusta,
Maine 04330
-----------------------------------------------------------------------
-----------------------------------------------------------------------
(street, city and zip code)
MUST BE COMPLETED FOR VOTE OF SHAREHOLDERS
------------------------------------------
I certify that I have custody of the minutes showing the above action by the
shareholders.
William M. Finn
-------------------------
(signature of clerk)
Date: April 15, 1992
Maine Yankee Atomic Power Company
---------------------------------
By* William M. Finn
---------------------------------
(signature)
William M. Finn, Clerk
---------------------------------
(type or print name and capacity)
By*
---------------------------------
(signature)
---------------------------------
(type or print name and capacity)
--------------------
* In addition to any certification of custody of minutes this document MUST be
signed by (1) the CLERK OR (2) the PRESIDENT or a vice-president AND the
SECRETARY, an assistant secretary or other officer the bylaws designate as
second certifying officer OR (3) if no such officers, a majority of the
DIRECTORS or such directors designated by a majority of directors then in
office OR (4) if no directors, the holders, or such of them designated by the
HOLDERS, OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES entitled to vote
thereon OR (5) the HOLDERS OF ALL OUTSTANDING SHARES.
NOTE: This form should not be used if any class of shares is entitled to vote
as a separate class for any of the reasons set out in ss.806, or because the
articles so provide. For vote necessary for adoption see ss.805.
FORM NO. MBCA-9 Rev.88
SUBMIT COMPLETED FORMS TO: Secretary of State, Station 101, Augusta, Maine 04333
<PAGE> 96
EXHIBIT A
TO ARTICLES OF AMENDMENT
DATED APRIL 15, 1992
FILED BY
MAINE YANKEE ATOMIC POWER COMPANY
RESOLVED: that the Articles of
Incorporation of this Company be
amended to increase the maximum
number of directors the Company
may have from seventeen to eighteen.
<PAGE> 97
A QUASI-PUBLIC CORPORATION
HAVING THE RIGHT TO ENGAGE IN
BUSINESS AS AN ELECTRIC COMPANY
STATE OF MAINE
ARTICLES OF AMENDMENT
(AMENDMENT BY SHAREHOLDERS VOTING AS SEPARATE CLASS)
Pursuant to 13-A MRSA Sections 805 and 807,
the undersigned corporation adopts
these Articles of Amendment:
Filing Fee (See Sec. 1401)
For Use By The Secretary of State
File No. 19660153D
Fee Paid $6750 - $35
C.B. ----
Date MAY 29, 1992
For Use By The Secretary of State FILED May 29, 1992
/s/ Gary Cooper
-------------------------
Deputy Secretary of State
A True Copy When Attested By Signature
/s/ ????
-------------------------
Deputy Secretary of State
FIRST: As set out in detail in "THIRD", one or more classes of shares of
the corporation were entitled to vote on the following amendment as
a separate class.
SECOND: The amendment set out in Exhibit A attached was adopted by the
shareholders (Circle one)
(A.) at a meeting legally called and held on, OR May 28, 1992
------------
B. by unanimous written consent on
THIRD: On said date, the number of shares of each class outstanding and
entitled to vote on such amendment (whether or not entitled to vote
as a separate class), the manner in which each such class was
entitled to vote (whether or not as separate class), and the number
of shares voted for and against said amendment, respectively, were
as follows:
<TABLE>
<CAPTION>
Designation of Manner No. of Shares
Each Class In Which Outstanding
However Entitled Entitled And Entitled Voted Voted
To Vote To Vote To Vote For Against
---------------- ----------- ------------ ------- -------
<S> <C> <C> <C> <C>
Common Stock As separate 500,000 500,000 0
class
Cumulative As separate 60,000 59,147 20
Preferred class
Stock
------- ------- --
Total of All Classes 560,000 559,147 20
</TABLE>
FOURTH: If such amendment provides for exchange, reclassification or
cancellation of issued shares, the manner in which this shall be
effected is contained in Exhibit B attached if it is not set forth
in the amendment itself.
FIFTH: If such amendment effects a change in the number or par values of
authorized shares the number of shares which the corporation has
authority to issue after giving effect to such amendment, is as
follows:
<TABLE>
<CAPTION>
Series Number Par Value
Class (If Any) of Shares (If Any)
------------ -------- --------- ---------
<S> <C> <C> <C>
Common Stock - 500,000 $100
Cumulative
Preferred
Stock * 260,000 $100
</TABLE>
* Issuable in series as determined by the Board of Directors. One series is
outstanding. See Article of Incorporation, as amended.
The aggregate par value of all such shares (of all classes and
series) HAVING PAR VALUE is $76,000,000.
----------
The total number of all shares (of all classes and series) WITHOUT
PAR VALUE is 0 shares.
-------
<PAGE> 98
SIXTH: Address of the registered office in Maine: Edison Drive, Augusta
-------------------------
Maine, 04336
--------------------------------------------------------------------
(street, city and zip code)
MUST BE COMPLETED FOR VOTE Maine Yankee Atomic Power Company
OF SHAREHOLDERS -------------------------------------
------------------------------------ (Name of Corporation)
I certify that I have custody of the By* /s/ William M. Finn
minutes showing the above action by -------------------------------------
the shareholders. (signature)
William M. Finn, Clerk
/s/ William M. Finn -------------------------------------
------------------------------------ (type or print name and capacity)
(signature of clerk) By*
-------------------------------------
(signature)
Dated: May 29, 1992 -------------------------------------
----------------- (type of print name and capacity)
-------------------------------------------------
* In addition to any certification of custody of minutes this document MUST be
signed by (1) the CLERK OR (2) the PRESIDENT or a vice-president AND the
SECRETARY, an assistant secretary or other officer the bylaws designate as
second certifying officer OR (3) if no such officers, a majority of the
DIRECTORS or such directors designated by a majority of directors then in office
OR (4) if no directors, the holders, or such of them designated by the HOLDERS,
OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES entitled to vote thereon OR
(5) the HOLDERS OF ALL OUTSTANDING SHARES.
NOTE: This form should not be used if any class of shares is entitled to vote as
a separate class for any of the reasons set out in ss. 806, or because the
articles so provide. For vote necessary for adoption see ss. 805.
FORM NO. MBCA-9A Rev. 88 SUBMIT COMPLETED FORMS TO: Secretary of State,
Station 101, Augusta, Maine 04333
<PAGE> 99
EXHIBIT A
TO ARTICLES OF AMENDMENT
DATED MAY 29, 1992
FILED BY
MAINE YANKEE ATOMIC POWER COMPANY
VOTED: that the Articles of Incorporation of this Company be amended so as to
increase the total number of authorized shares of Cumulative Preferred
Stock, $100 par value, from 170,000 shares to 260,000 shares, as set
forth in the Proxy Statement for this meeting.
<PAGE> 100
STATE OF MAINE
STATEMENT OF
RESOLUTION ESTABLISHING SERIES
OF SHARES
OF
MAINE YANKEE ATOMIC POWER COMPANY
A QUASI-PUBLIC CORPORATION
HAVING THE RIGHT TO ENGAGE IN
BUSINESS AS AN ELECTRIC COMPANY
Filing Fee $20.00
For Use By The
Secretary of State
File No. 19660153D
----------------
Fee Paid $20.00
---------------
C.B. ---
--------------------
Date ---
-------------------
For Use By The Secretary of State
FILED
September 18, 1992
-------------------------
Gary Cooper
-------------------------
Deputy Secretary of State
-------------------------
A True Copy When Attested
By Signature
Pamela A. French
-------------------------
Deputy Secretary of State
Pursuant to 13-A MRSA s.503, the undersigned corporation submits the
following for the purposes of establishing and designating a series of shares
and fixing and determining the relative rights and preferences thereof:
FIRST: The attached resolution establishing and designating the series
and fixing and determining the relative rights and preferences
thereof was duly adopted by the board of directors on
September 18, 1992.
--------------------------------------------------------------
SECOND: The Articles expressly grant to the board of directors the
authority to make such a resolution.
THIRD: The address of the registered office of the corporation is:
Edison Drive, Augusta, Maine 04330
--------------------------------------------------------------
(street, city, state and zip code)
Dated: September 18, 1992
Maine Yankee Atomic Power Company
----------------------------------
(Name of Corporation)
By /s/ William M. Finn
-------------------------------
(signature)
William M. Finn, Clerk
----------------------------------
(type or print name and capacity)
By -------------------------------
(signature)
----------------------------------
(type or print name and capacity)
---------------------------------------
This document MUST be signed by (1) the CLERK OR (2) the PRESIDENT or a
vice-president AND the SECRETARY, an assistant secretary or other officer the
bylaws designate as second certifying officer OR (3) if no such officers, a
majority of the DIRECTORS or such directors designated by a majority of
directors then in office OR (4) if no directors, the holders, or such of them
designated by the HOLDERS, OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES
entitled to vote thereon OR (5) the HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 101
MAINE YANKEE ATOMIC POWER COMPANY
RESOLUTION OF BOARD OF DIRECTORS
September 18, 1992
RESOLVED: that there be and there hereby is established a second series of
Cumulative Preferred Stock of this Corporation; and that the
designation, relative rights, preferences and limitations of said
series be and they hereby are established, designated, fixed and
determined as follows:
(1) DESIGNATION AND DIVIDEND RATE. The second series of the Cumulative
Preferred Stock of the Corporation shall be designated "Cumulative Preferred
Stock, 8.00% Series (Sinking Fund)"; the number of authorized shares of such
series which may be issued shall be 150,000; and the annual dividend rate per
share for such shares shall be 8.00% of the par value thereof. The shares of
such series shall rank on a parity with shares of the Cumulative Preferred
Stock, 7.48% Series (Sinking Fund), including without limitation for purposes of
dividends, redemption, sinking fund and liquidation rights.
All amounts of dividends payable with respect to the shares shall be
computed on the basis of a year of 360 days consisting of four quarters of 90
days each. Accordingly, for the purpose of determining the amount of the
dividends payable on October 1, 1992, the Company shall multiply the annual
dividend rate by a fraction, the numerator of which shall be the number of days
from (and excluding) the Closing Date to (and including) October 1, 1992, and
the denominator of which shall be 360.
(2) REDEMPTION PRICES. Except as stated in Sections (3) and (4) below,
shares of the Cumulative Preferred Stock, 8.00% Series (Sinking Fund) shall be
redeemable, as a whole or in part from time to time, at the option of the
Corporation at any time on and after October 1, 1997, in accordance with the
Capital Stock Provisions of the Corporation's Articles of Incorporation, as
amended, and Section (5) below, at the redemption prices per share indicated
below, plus an amount equal to dividends accrued thereon to the date of
redemption:
<PAGE> 102
<TABLE>
<CAPTION>
REDEMPTION
PRICE
PERIOD PER SHARE
------ ----------
<S> <C>
On or after October 1, 1997 but before October 1, 1998 $105.33
On or after October 1, 1998 but before October 1, 1999 104.80
On or after October 1, 1999 but before October 1, 2000 104.27
On or after October 1, 2000 but before October 1, 2001 103.73
On or after October 1, 2001 but before October 1, 2002 103.20
On or after October 1, 2002 but before October 1, 2003 102.67
On or after October 1, 2003 but before October 1, 2004 102.13
On or after October 1, 2004 but before October 1, 2005 101.60
On or after October 1, 2005 but before October 1, 2006 101.07
On or after October 1, 2006 but before October 1, 2007 100.53
On or after October 1, 2007 100.00
</TABLE>
No shares of the Cumulative Preferred Stock, 8.00% Series (Sinking Fund),
may be redeemed, directly or indirectly, by the Corporation prior to October 1,
1997.
(3) MANDATORY SINKING FUND. The Corporation shall, on October 1, 2002, and
on each October 1 thereafter (each such date being hereinafter referred to as
the "mandatory redemption date"), redeem 21,500 shares of Cumulative Preferred
Stock, 8.00% Series (Sinking Fund), in the manner and with the effect provided
in Section 4 of the Capital Stock Provisions of the Corporation's Articles of
Incorporation, as amended, and Section (5) below, and the redemption price with
respect to each share so redeemed shall be $100 per share, plus dividends
accrued thereon to the date of redemption, provided that no such redemption
shall be made if the same would result in violation of Section 4 of said Capital
Stock Provisions. Any shares of this series of Cumulative Preferred Stock
redeemed by the Corporation in accordance with Section (2) above which have not
previously been used as a credit against any mandatory sinking fund redemption,
may be credited by the Corporation share for share against any mandatory sinking
fund redemption.
(4) OPTIONAL SINKING FUND. In addition to the redemptions required by
Section (3) above, the Corporation shall have the noncumulative option to redeem
on each mandatory redemption date (after satisfaction of the mandatory
redemption due on said date), at a price of $100 per share plus dividends
accrued thereon to the date of redemption, not more than 21,500 additional
shares of Cumulative Preferred Stock, 8.00% Series (Sinking Fund), in the manner
and with the effect provided in Section 4 of the Capital Stock Provisions of the
Corporation's Articles of Incorporation, as amended, and Section (5) below,
provided that no such optional redemption shall be made if the same would result
in violation of Section 4 of said Capital Stock Provisions.
<PAGE> 103
(5) REDEMPTION AND SINKING FUND PROCEDURES. All shares of the Cumulative
Preferred Stock, 8.00% Series (Sinking Fund) redeemed or used by the Company to
satisfy any sinking fund shall be retired and restored to the status of
authorized but unissued shares. Redemptions of the shares of said series shall
be made by a method designed to result, as nearly as practicable, in a
redemption pro rata among the holders of the shares.
(6) LIQUIDATION, ETC. The amount payable upon shares of the Cumulative
Preferred Stock, 8.00% Series (Sinking Fund) in the event of any involuntary
liquidation, dissolution or winding up of the affairs of the Corporation shall
be $100 per share plus dividends accrued thereon to the date of distribution.
The amount payable upon shares of the Cumulative Preferred Stock, 8.00% Series
(Sinking Fund) in the event of any voluntary liquidation, dissolution or winding
up of the affairs of the Corporation shall be the applicable redemption price
per share stated below, plus dividends accrued thereon to the date of
distribution:
<TABLE>
<CAPTION>
REDEMPTION
PRICE
PERIOD PER SHARE
------ ----------
<S> <C>
On or after the Closing Date but before October 1, 1993 $108.00
On or after October 1, 1993 but before October 1, 1994 107.47
On or after October 1, 1994 but before October 1, 1995 106.93
On or after October 1, 1995 but before October 1, 1996 106.40
On or after October 1, 1996 but before October 1, 1997 105.87
On or after October 1, 1997 but before October 1, 1998 105.33
On or after October 1, 1998 but before October 1, 1999 104.80
On or after October 1, 1999 but before October 1, 2000 104.27
On or after October 1, 2000 but before October 1, 2001 103.73
On or after October 1, 2001 but before October 1, 2002 103.20
On or after October 1, 2002 but before October 1, 2003 102.67
On or after October 1, 2003 but before October 1, 2004 102.13
On or after October 1, 2004 but before October 1, 2005 101.60
On or after October 1, 2005 but before October 1, 2006 101.07
On or after October 1, 2006 but before October 1, 2007 100.53
On or after October 1, 2007 100.00
</TABLE>
<PAGE> 104
STATE OF MAINE
CHANGE OF CLERK OR
REGISTERED OFFICE OR BOTH
PURSUANT TO 13-A MRSA Section 304 the undersigned
corporation advises you of the following change(s):
Gary Cooper
---------------------------------
Deputy Secretary of State
---------------------------------
A True Copy When Attested
By: Signature
---------------------------------
Deputy Secretary of State
FIRST: The name and registered office of the clerk appearing on the
record in Secretary of State's office
William M. Finn, Clerk, Maine Yankee Atomic Power Company
--------------------------------------------------------------
Edison Drive, Augusta, ME 04336
--------------------------------------------------------------
(street, city, state and zip code)
SECOND: The name and physical location of the registered office of the
successor (new) clerk, who must be a Maine resident, are:
Mary Ann Lynch, Clerk, Maine Yankee Atomic Power Company
--------------------------------------------------------------
(name)
329 Bath Road, Brunswick, ME 04011
--------------------------------------------------------------
(street address (not P.O. Box), city, state and zip code)
--------------------------------------------------------------
(mailing address if different from above)
THIRD: Upon a change in clerk this must be completed:
(X) Such change was authorized by the board of directors and
the power to make such change is not reserved to the
shareholders by the articles or the bylaws.
( ) Such change was authorized by the shareholders. (Complete
the following)
I certify that I have custody of the minutes showing the
above action by the shareholders.
/s/ Mary Ann Lynch, Secretary
-----------------------------------------
(signature of new clerk, secretary or
assistant secretary)
Maine Yankee Atomic Power Company
-----------------------------------------
(Name of Corporation)
Date: June 21, 1996 By /s/ Mary Ann Lynch
-----------------------------------------
(Signature)
Mary Ann Lynch, Clerk
-----------------------------------------
(type or print name and capacity)
By
-----------------------------------------
(signature)
-----------------------------------------
(type or print name and capacity)
---------------------------------------
This document MUST by signed by (1) the CLERK OR (2) the PRESIDENT or a
vice-president AND the SECRETARY, an assistant secretary or other officer the
bylaws designate as second certifying officer OR (3) if no such officers, a
majority of the DIRECTORS or such directors designated by a majority of
directors then in office OR (4) if no directors, the holders, or such of them
designated by the HOLDERS, OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES
entitled to vote thereon OR (5) the HOLDERS OF ALL OUTSTANDING SHARES.
<PAGE> 105
STATE OF MAINE
ARTICLES OF AMENDMENT
(AMENDMENT BY SHAREHOLDERS
VOTING AS ONE CLASS)
Pursuant to 13-A MRSA Sections 805 and 807, the under-
signed corporation adopts these Articles of Amendment:
Gary Cooper
--------------------------------
Deputy Secretary of State
--------------------------------
A True Copy When Attested
By Signature
--------------------------------
Deputy Secretary of State
FIRST: All outstanding shares were entitled to vote on the following
amendment as ONE class.
SECOND: The amendment set out in Exhibit A attached was adopted by the
shareholders (Circle one)
A. at a meeting legally called and held on, OR
(B.) by unanimous written consent on November 6, 1996.
----------------
THIRD: Shares outstanding and entitled to vote and shares voted for and
against said amendment were:
Number of Shares Outstanding NUMBER NUMBER
and Entitled to Vote Voted For Voted Against
---------------------------- --------- -------------
Common Stock -- 500,000 shares 500,000 0
FOURTH: If such amendment provides for exchange, reclassification or
cancellation of issued shares, the manner in which this shall be
effected is contained in Exhibit B attached if it is not set forth
in the amendment itself.
FIFTH: If the amendment changes the number or par values of authorized
shares, the number of shares the corporation has authority to issue
thereafter, is as follows:
Class Series (If Any) Number of Shares Par Value (If Any)
----- --------------- ---------------- ------------------
The aggregate par value of all such shares (of all classes and
series) HAVING PAR VALUE is $ .
-----------------
The total number of all shares (of all classes and series) WITHOUT
PAR VALUE is shares.
--------------------------
SIXTH: Address of the registered office in Maine: 329 Bath Road,
-------------------------
Brunswick, Maine 04011
--------------------------------------------------------------------
(street, city and zip code)
MUST BE COMPLETED FOR VOTE Maine Yankee Atomic Power Company
OF SHAREHOLDERS -------------------------------------
------------------------------------ (Name of Corporation)
I certify that I have custody of the By* /s/ Mary Ann Lynch
minutes showing the above action by ------------------------------------
the shareholders. (signature)
Mary Ann Lynch, Clerk
/s/ Mary Ann Lynch ------------------------------------
------------------------------------ (type or print name and capacity)
(signature of clerk, secretary or By*
asst. secretary) ------------------------------------
(signature)
Dated: November 19, 1996 ------------------------------------
----------------- (type of print name and capacity)
-------------------------------------------------
* In addition to any certification of custody of minutes this document MUST be
signed by (1) the CLERK OR (2) the PRESIDENT or a vice-president AND the
SECRETARY, an assistant secretary or other officer the bylaws designate as
second certifying officer OR (3) if no such officers, a majority of the
DIRECTORS or such directors designated by a majority of directors then in office
OR (4) if no directors, the holders, or such of them designated by the HOLDERS,
OF RECORD OF A MAJORITY OF ALL OUTSTANDING SHARES entitled to vote thereon OR
(5) the HOLDERS OF ALL OUTSTANDING SHARES.
NOTE: This form should not be used if any class of shares is entitled to vote
as a separate class for any of the reasons set out in Section 806, or because
the articles so provide. For vote necessary for adoption see Section 805.
FORM NO. MBCA-3 Rev. 88 SUBMIT COMPLETED FORMS TO: Secretary of State,
Station 101, Augusta, Maine 04333
<PAGE> 106
EXHIBIT A
RESOLVED: that the Articles of Incorporation
of this Company be amended to
increase the maximum number of
directors the Company may have
from eighteen to nineteen.
<PAGE> 107
EXHIBIT B-1
LONG-TERM PROJECTIONS THROUGH OCTOBER 31, 2008
Maine Yankee Atomic Power Company
Pro Forma Balance Sheet
unaudited
<TABLE>
<CAPTION>
January 1, 2000
December 31, Through October 31,
1999 October 31, 2008 2008
<S> <C> <C> <C>
ASSETS
LAND $ 685,438 $ (191,794) $ 493,644
WORKING CAPITAL 596,283 (127,766) 468,517
------------- ------------- -------------
PREPAID DOE D&D 1,504,498 (1,504,498) --
------------- ------------- -------------
DEFERRED CHARGES AND
OTHER ASSETS
Net Unrecovered Assets 194,648,637 (194,648,637) --
-------------
Other Deferred Charges and
Other Assets 5,883,001 (5,883,001) --
------------- ------------- -------------
Total Deferred Charges and Other
Assets 200,531,638 (200,531,638) --
------------- ------------- -------------
$ 203,317,857 $(202,355,696) $ 962,161
============= ============= =============
STOCKHOLDERS' INVESTMENT AND
LIABILITIES CAPITALIZATION
Common Stock Investment $ 50,000,000 $ (49,500,000) $ 500,000
Other Paid-in Capital, Net of Expense 16,216,145 (16,053,984) 162,161
Preferred Stock Gains & Premiums, Net 1,173,351 (1,173,351) --
Retained Earnings 7,588,976 (7,588,976) --
------------- ------------- -------------
Total Common Stock Investment 74,978,472 (74,316,311) 662,161
Redeemable Preferred Stock 15,000,000 (15,000,000) --
Long Term Debt 48,000,000 (48,000,000) --
------------- ------------- -------------
Total Capitalization 137,978,472 (137,316,311) 662,161
------------- ------------- -------------
REVOLVING LOANS 6,000,000 (6,000,000) --
------------- ------------- -------------
RESERVES AND DEFERRED CREDITS
Accumulated Deferred Income Tax
Liabilities 42,758,201 (42,958,201) (200,000)
Unamortized Investment Tax Credits 4,912,583 (4,912,583) --
SFAS 109 Deferred Tax Related Liabilities 6,215,683 (6,215,683) --
Other Deferred Credits 5,452,918 (4,952,918) 500,000
------------- ------------- -------------
Total Reserves and Deferred Credits . 59,339,385 (59,039,385) 300,000
------------- ------------- -------------
$ 203,317,857 $(202,355,696) $ 962,161
============= ============= =============
</TABLE>
<PAGE> 108
EXHIBIT F-1
OPINION OF COMPANY COUNSEL AS TO MATTERS REQUIRED BY INSTRUCTION
F-1 TO EXHIBITS TO FORM U-1
June 30, 2000
Securities and Exchange Commission
Washington, DC 20549
Re: Maine Yankee Atomic Power Company
File No. 70-
Ladies and Gentlemen:
This opinion is furnished to you in connection with the filing with you of
the Declaration on Form U-1 (the "Declaration") of Maine Yankee Atomic Power
Company (the "Company") under the Public Utility Holding Company Act of 1935, as
amended, relating to the proposed redemption by the Company of up to 99% of its
outstanding Common Stock.
I am counsel for the Company and in connection with this opinion I have
reviewed the Company's charter, by-laws and the minutes of the meetings of the
board of directors of the Company and such other materials as I deemed necessary
to this opinion.
Based upon the foregoing, I am of the opinion that, when the Commission has
taken the action requested in the Declaration and when the shares have been
tendered by all the sponsoring utilities and the redemption price has been paid
by the Company, all as described in the Declaration:
1. The Company is a corporation duly incorporated and validly existing
under the laws of The State of Maine.
2. All State laws applicable to the repurchase of the shares of Common
Stock as described in the Declaration will have been complied with.
3. The Company will legally redeem the shares of Common Stock being
redeemed.
4. Consummation of the aforesaid repurchase of Common Stock of the
Company will not violate the legal rights of the holders of any
securities issued by the Company.
<PAGE> 109
I hereby consent to the use of this opinion in connection with the
Declaration.
Very truly yours,
s/ William M. Finn
William M. Finn
<PAGE> 110
EXHIBIT H-1
MAINE YANKEE'S ESTIMATED FEES AND EXPENSES
EXPENSE TYPE ESTIMATE
------------ --------
Legal Fees $3,500
Misc. Expenses 1,000
------------------------ ------
TOTAL ESTIMATED EXPENSES $4,500
======================== ======
<PAGE> 111
EXHIBIT I-1
Proposed Form of Notice
MAINE YANKEE ATOMIC POWER COMPANY
Maine Yankee Atomic Power Company ("Maine Yankee"), 321 Old Ferry Road,
Wiscasset, ME 04578, a subsidiary of National Grid USA, National Grid Group Plc
and Northeast Utilities, each a registered holding company, has filed a
declaration under Section 12(c) of the Act and Rule 42 thereunder.
Yankee proposes to redeem from its nine stockholders ("Sponsors") an
aggregate of up to 495,000 shares of its Common Stock (representing all but
5,000 shares of its outstanding Common Stock), 99% of the presently outstanding
Common Stock. Maine Yankee intends to accomplish this repurchase in one or more
steps over the next eight years, with all such redemptions completed by October
31, 2008. The redemption price per share of Common Stock for each such
redemption shall be equal to the amount obtained by dividing (1) the sum of the
aggregate par value of the Common Stock then outstanding plus the capital
surplus, including without limitation other paid-in capital (less any deficit in
earned surplus) immediately prior to such redemption by (2) the number of shares
of Common Stock outstanding immediately prior to such redemption. The funds for
the repurchase will be obtained from cash on hand.
Maine Yankee is a single purpose electric utility which formerly operated a
nuclear powered electric generation facility (the "Plant"), the output of which
was sold to Maine Yankee's nine Sponsors. The Plant was permanently taken out of
service in 1997 and Maine Yankee is in the process of decommissioning the
facility. Pursuant to Power Contracts between Maine Yankee and each Sponsor,
which have been approved by the Federal Energy Regulatory Commission, the
Sponsors are continuing to make payments to Maine Yankee to cover funds for
decommissioning the Plant and waste disposal, amortization of plant investment
and return on equity. As these obligations are reduced or provided for, Maine
Yankee believes its minimum equity requirements will also significantly decline.
Therefore, Maine Yankee contemplates this redemption of Common Stock to reduce
its equity.
No other state or Federal agency has jurisdiction over this proposed
transaction.
<PAGE> 112
(b) FINANCIAL STATEMENTS
J-1 Balance Sheets of Maine Yankee as of March 31, 2000 and December 31, 1999
J-2 Statements of Income of Maine Yankee for the twelve months ended March 31,
2000 and December 31, 1999
<PAGE> 113
MAINE YANKEE ATOMIC POWER COMPANY
BALANCE SHEETS
(Dollars in Thousands)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
---- ----
(Unaudited)
<S> <C> <C>
UTILITY PLANT AT ORIGINAL COST $ 685 $ 685
---------- ----------
CURRENT ASSETS
Cash and Cash Equivalents 6,400 14,828
Accounts Receivable 7,194 6,319
Prepayments 300 1,939
---------- ----------
Total Current Assets 13,894 23,086
---------- ----------
DEFERRED CHARGES AND OTHER ASSETS
Trust Funds
Plant Decommissioning 182,538 187,708
Fuel Disposal 129,012 130,983
Other 178 177
Regulatory Assets
Closure 413,890 435,859
Net Unrecovered Assets 189,122 194,649
DOE Decontamination and Decommissioning Fee 13,691 14,142
ISFSI-Related Costs 11,934 --
Other 6,239 6,677
Accumulated Deferred Income Tax Assets 53,903 51,330
Other Deferred Charges and Other Assets 5,082 4,676
---------- ----------
Total Deferred Charges and Other Assets 1,005,589 1,026,201
---------- ----------
$1,020,168 $1,049,972
========== ==========
</TABLE>
<PAGE> 114
MAINE YANKEE ATOMIC POWER COMPANY
BALANCE SHEETS
(Dollars in Thousands)
CAPITALIZATION AND LIABILITIES
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
---- ----
(Unaudited)
<S> <C> <C>
CAPITALIZATION
Common Stock Investment $ 73,969 $ 74,978
Redeemable Preferred Stock 15,000 15,000
Long-Term Debt 48,000 48,000
---------- ----------
Total Capitalization 136,969 137,978
---------- ----------
LONG-TERM FUEL DISPOSAL LIABILITY 141,462 139,535
---------- ----------
REVOLVING LOANS 2,000 6,000
---------- ----------
CURRENT LIABILITIES
Current Sinking Fund Requirements -- 1,800
Accounts Payable 5,336 7,284
Accounts Payable to Associated Companies 453 1,144
Dividends Payable 2,500 2,834
Accrued Interest and Taxes 3,455 2,325
Other Current Liabilities 1,822 6,776
---------- ----------
Total Current Liabilities 13,566 22,163
---------- ----------
RESERVES AND DEFERRED CREDITS
Plant Decommissioning Reserve 183,841 183,227
Deferred Credits
Regulatory Liabilities
Closure 413,890 435,859
DOE Decontamination and Decommissioning Fee 10,832 10,832
Other 7,192 6,996
Accumulated Deferred Income Tax Liabilities 96,949 94,088
Unamortized Investment Tax Credits 4,791 4,913
Unamortized Gains on Reacquired Debt 867 971
Other Deferred Credits 7,809 7,410
---------- ----------
Total Reserves and Deferred Credits 726,171 744,296
---------- ----------
$1,020,168 $1,049,972
========== ==========
</TABLE>
<PAGE> 115
MAINE YANKEE ATOMIC POWER COMPANY
STATEMENTS OF INCOME
(Dollars in Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
For the Twelve Months Ended
------------------------------
March 31, December 31,
2000 1999
---- ----
(Unaudited)
<S> <C> <C>
ELECTRIC OPERATING REVENUES $ 66,709 $ 69,439
--------- ---------
OPERATING EXPENSES
Fuel Disposal Cost 1,782 1,772
Operation and Maintenance (1,612) (1,635)
Amortization 22,085 22,115
Decommissioning Collections 30,455 33,171
Taxes
Federal and State Income 1,289 1,219
Local Property 65 108
--------- ---------
Total Operating Expenses 54,064 56,750
--------- ---------
OPERATING INCOME 12,645 12,689
OTHER INCOME (EXPENSE), NET 6,233 6,253
--------- ---------
INCOME BEFORE INTEREST CHARGES 18,878 18,942
--------- ---------
INTEREST CHARGES
Long-Term Debt 3,778 3,778
Revolving Loans 619 882
Fuel Disposal Liability 6,786 6,353
Amort. Of Debt Expense 1,337 1,337
Other Interest Charges 252 394
--------- ---------
Total Interest Charges 12,772 12,744
--------- ---------
NET INCOME 6,106 6,198
Dividends on Preferred Stock 1,305 1,335
--------- ---------
EARNINGS APPLICABLE TO COMMON STOCK $ 4,801 $ 4,863
========= =========
SHARES OF COMMON STOCK OUTSTANDING 500,000 500,000
========= =========
EARNINGS PER SHARE OF COMMON STOCK $ 9.60 $ 9.73
========= =========
DIVIDENDS DECLARED PER SHARE OF COMMON
STOCK $ 18.80 $ 18.75
========= =========
</TABLE>
