SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 of the
Securities Exchange Act of 1934
Date of Earliest Event Reported: October 29, 1999
NEW ENGLAND ELECTRIC SYSTEM
(exact name of registrant as specified in charter)
Massachusetts 1-3446 04-1663060
(state or other (Commission (I.R.S. Employer
jurisdiction of File No.) Identification No.)
incorporation)
25 Research Drive, Westborough, Massachusetts 01582
(Address of principal executive offices)
(508) 389-2000
(Registrant's telephone number, including area code)
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Item 5. Other Events
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National Grid Merger Update
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As previously reported, in connection with the merger of New
England Electric System (NEES) and The National Grid Group plc
(National Grid), NEES and National Grid filed for merger approval
with the Nuclear Regulatory Commission (NRC) associated with the
minority ownership interests of a NEES subsidiary in six nuclear
plants. On July 20, 1999, three subsidiaries of Northeast
Utilities (NU, the lead owner of two of the nuclear plants) filed
a request for hearing with the NRC raising issues with respect to
foreign ownership and whether the NEES subsidiary will continue
to meet the financial qualifications standards under the Atomic
Energy Act.
On October 21, 1999, the NRC granted the request for a
hearing on these two issues and directed NEES, National Grid, and
the Northeast Utilities subsidiaries to confer promptly on
whether this proceeding could be settled without the need for a
hearing.
On October 29, 1999, NEES, National Grid, and the NU
subsidiaries notified the NRC that an agreement in principle
had been negotiated with respect to these issues. As part of
this agreement, the NU subsidiaries have agreed to withdraw their
petitions for intervention and hearing. Once the NRC grants the
withdrawal and dismisses the hearing, NEES and National Grid
anticipate that remaining regulatory approvals of the merger from
the NRC and the Securities and Exchange Commission will be
obtained in a time frame that will allow the merger to be
completed by early 2000.
Millstone 3 Update
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As previously reported, in August 1997, NEES subsidiary New
England Power Company (NEP) sued NU in Massachusetts Superior
Court for damages caused by the shutdown of Millstone 3. NEP
also sent a demand for arbitration to subsidiaries of NU, seeking
damages for the same shutdown under an agreement with the Company
and others regarding the operation and ownership of Millstone 3.
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On October 29, 1999, NEP, NU, and the NU subsidiaries reached
an agreement in principle to settle the litigation and
arbitration described in the preceding paragraph. The proposed
settlement would involve the payment of fixed and contingent
amounts to NEP, as well as an agreement by NU to include NEP's
Millstone interest when NU sells its Millstone interest at
auction. The settlement is subject to the execution of a
definitive agreement.
Amounts received pursuant to the proposed settlement will,
after reimbursement of NEP's net investment in the unit and
transaction costs, be credited to customers.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this Current Report on
Form 8-K to be signed on its behalf by the undersigned thereunto
duly authorized.
NEW ENGLAND ELECTRIC SYSTEM
s/Michael E. Jesanis
By
Michael E. Jesanis
Senior Vice President and
Chief Financial Officer
Date: October 29, 1999
The name "New England Electric System" means the trustee or
trustees for the time being (as trustee or trustees but not
personally) under an agreement and declaration of trust dated
January 2, 1926, as amended, which is hereby referred to, and a
copy of which as amended has been filed with the Secretary of The
Commonwealth of Massachusetts. Any agreement, obligation or
liability made, entered into or incurred by or on behalf of New
England Electric System binds only its trust estate, and no
shareholder, director, trustee, officer or agent thereof assumes
or shall be held to any liability therefor.
