<PAGE> File Nos. 70-7950/70-8555
CERTIFICATE OF NOTIFICATION
(Rule 24)
SECURITIES AND EXCHANGE COMMISSION
BY
NEES GLOBAL, INC. (NG)
(Formerly NEES GLOBAL TRANSMISSION, INC. (NGT))
In accordance with the orders of the Securities and Exchange Commission
dated September 4, 1992 and May 15, 1995, the following is a corrected report
for the second quarter of 1999:
1.Effective May 1, 1998, NGT changed its name to NEES Global, Inc. (NG).
NG is a Massachusetts corporation which was formed in January 1992. NG was not
capitalized until October 13, 1992, when one thousand shares of NG common
stock were issued to New England Electric System (NEES).
On June 25, 1998, New England Water Heater Co., Inc. (NEWH), an energy-related
company, became a wholly-owned subsidiary of NG in accordance with Rule 58 of
the Act. The company's financial statements are consolidated with NG. In the
third quarter of 1998, NEWH purchased at net book value all rental water
heaters from its affiliates, Massachusetts Electric Company and The
Narragansett Electric Company. On September 21, 1999, substantially all of the
assets of NEWH were sold to Duperey Investments, Inc., an unaffiliated
company. This transaction will be fully reflected in the third quarter 1999
filing.
NG is a party to an agreement with a company located in Pennsylvania to
provide ongoing work as a subcontractor for electric meter retrofit services.
The work took place in Massachusetts. The contract has been terminated, no
additional revenue will be recognized.
NG entered into agreements with companies located in Canada, Washington, DC,
Washington, Massachusetts, New Jersey, New York, and Virginia to provide
consulting services. A total of $230,000 in revenue was recognized in the
second quarter of 1999.
2.As of June 30, 1999, NEES had purchased 1,000 shares of NG common stock
and had made subordinated loans and other paid-in capital contributions to NG
totaling $24,826,000 and $4,353,000, respectively.
3.As of June 30, 1999, NG employed no permanent personnel. However,
during the three-month period ending June 30, 1999, 68 employees of associated
companies of NEES billed portions of their time to NG.
4.As of June 30, 1999, NG had not purchased or received from associated
companies of NEES any intellectual property.
5.During the three-month period ended June 30, 1999, NG received
legal, financial, and other administrative services from New England Power
Service Company, amounting to $200,000.
6.Attached in Exhibits A through C are the consolidated financial
statements of NG. These statements include a balance sheet, income statement,
and statement of cash flows. All significant intercompany transactions have
been eliminated.
In May 1995, NG invested $1,000,000 in Separation Technologies, Inc. (STI).
This investment is in the form of 153,846 shares of 6% cumulative convertible
preferred stock. NG also provides maintenance services for STI equipment on
an as needed basis, for which no revenue was recognized in the second quarter
of 1999.
In August 1997, NG invested $1,400,000 in Nexus Energy Software, Inc. in
the form of 1,000,000 shares of Series A Preferred Stock. An additional
investment of $750,000 was made in October 1998 in the form of 300,000 shares
of Series B Preferred Stock.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, the undersigned company has duly caused this certificate of notification
(Commission's File No. 70-7950 and 70-8555) to be signed on its behalf by the
undersigned officer thereunto duly authorized.
NEES GLOBAL, INC.
s/ John G. Cochrane
By: _________________________________
John G. Cochrane
Treasurer
Date: October 5, 1999
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page
- ----------- ----------- ----
A Consolidated Balance Sheet at June 30, 1999 Filed
(Unaudited, subject to adjustment) herewith
B Consolidated Statement of Income and Filed
Accumulated Deficit for the six and twelve herewith
months ended June 30, 1999
(Unaudited, subject to adjustment)
C Consolidated Statement of Cash Flows Filed
for the six and twelve months ended herewith
June 30, 1999
(Unaudited, subject to adjustment)
<PAGE>Exhibit A
<TABLE>
NEES GLOBAL, INC.
Consolidated Balance Sheet
June 30, 1999
(Unaudited, Subject to Adjustment)
(thousands of dollars)
<CAPTION>
<S> <C>
ASSETS
- ------
Current assets:
Cash $ 362
Accounts receivable, less reserves 903
Other current assets 740
-------
Total current assets 2,005
-------
Fixed assets:
Property and equipment 21,367
Accumulated depreciation (5,102)
-------
Total fixed assets 16,265
-------
Investments at cost:
Separation Technologies, Inc. 1,000
Nexus, Inc. 2,150
-------
Total investments 3,150
-------
Total assets $21,420
=======
LIABILITIES AND PARENT COMPANY'S INVESTMENT
- -------------------------------------------
Current liabilities:
Accounts payable $ 220
Accrued taxes 408
Miscellaneous accrued liabilities 76
-------
Total current liabilities 704
-------
Accumulated deferred income taxes 1,200
Deferred credits and other liabilities 327
-------
Total other liabilities 1,527
-------
Parent company's investment:
Subordinated notes payable to parent 24,826
Common stock, par value $1 per share 1
Other paid-in capital 4,361
Accumulated deficit (9,999)
-------
Total parent company's investment 19,189
-------
Total liabilities and parent company's
investment $21,420
=======
</TABLE>
<PAGE>Exhibit B
<TABLE>
NEES GLOBAL, INC.
Consolidated Statement of Income and Accumulated Deficit
For the Periods Ended June 30, 1999
(Unaudited, Subject to Adjustment)
(thousands of dollars)
<CAPTION>
<S> <C> <C>
SixTwelve
Months Months
------------
INCOME
- ------
Rental water heater revenue $ 4,831 $ 9,032
Consulting revenue and other 416 885
Equity in earnings - HydroServ Group, LLC - (50)
-------- -------
Total income 5,247 9,867
EXPENSE
- -------
Operation and maintenance expenses 3,016 6,304
Write-off of investment in:
Underwater Unlimited Diving Services, Inc. - 1,000
Monitoring Technologies, Inc. - 475
HydroServ Group, LLC - 9
Loss on sale of interest in AllEnergy Marketing Co., Inc. 220 220
Depreciation 1,100 2,269
Income taxes 497 (337)
------- -------
Total expenses 4,833 9,940
Net income (loss) $ 414 $ (73)
======== =======
Accumulated deficit at beginning of period (restated) $(10,413)
$(9,926)
Accumulated deficit at end of period $ (9,999) $(9,999)
======== =======
</TABLE>
<PAGE>Exhibit C
<TABLE>
<CAPTION>
NEES GLOBAL, INC.
Consolidated Statement of Cash Flows
For the Period Ended June 30, 1999
(Unaudited, Subject to Adjustment)
(thousands of dollars)
<S> <C> <C>
Six Twelve
Months Months
------ ------
Operating Activities:
Net income (loss) $ 414 $ (73)
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Depreciation 1,100 2,269
Loss on investments 220 1,704
Deferred income taxes 364 830
(Increase)/decrease in accounts receivable 36 (435)
(Increase)/decrease in other current assets 480 (436)
Increase/(decrease) in accounts payable (56) (148)
Increase/(decrease) in other current liabilities 129 449
Other, net 519 1,508
------- --------
Net cash provided by (used in) operating activities $ 3,206 $ 5,668
------- --------
Investing Activities:
Fixed asset expenditures (1,395) (15,108)
Investment in HydroServ Group, LLC - (40)
Investment in Nexus, Inc. - (750)
Investment in AllEnergy Marketing Co., LLC - (256)
Sale of interest in AllEnergy Marketing Co., LLC 456 456
------- --------
Net cash used in investing activities $ (939) $(15,698)
------- --------
Financing Activities:
Change in subordinated notes payable to parent $(2,500) $ 10,077
------ --------
Net cash provided by (used in) financing activities $(2,500) $ 10,077
------- --------
Net increase/(decrease) in cash and cash equivalents $ (233) $ 47
Cash and cash equivalents at beginning of period 595 315
------- --------
Cash and cash equivalents at end of period $ 362 $ 362
======= ========
</TABLE>