FILE NO. 70-8875
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
POST-EFFECTIVE AMENDMENT NO. 10 TO
FORM U-1
(AMENDMENT NO. 12)
APPLICATION/DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Northeast Utilities Holyoke Water Power Company
Western Massachusetts Electric Company Canal Street
174 Brush Hill Avenue Holyoke, MA 01040
West Springfield, MA 01090-0010
The Connecticut Light and Power Company Public Service Company of
NU Enterprises, Inc. New Hampshire
Northeast Generation Service Company North Atlantic Energy
Northeast Generation Company Corporation
Select Energy, Inc. 1000 Elm Street
Mode 1 Communications, Inc. Manchester, NH 03015
107 Selden Street
Berlin, CT 06037
(Name of companies filing this statement and
addresses of principal executive offices)
NORTHEAST UTILITIES
(Name of top registered holding company)
Cheryl W. Grise, Esq.
Senior Vice President, Secretary and General Counsel
Northeast Utilities Service Company
P.O. Box 270
Hartford, Connecticut 06141-0270
(Name and address of agent for service)
The Commission is requested to mail signed copies of all orders, notices and
communications to:
David R. McHale Jeffrey C. Miller, Esq.
Vice President and Treasurer Assistant General Counsel
Northeast Utilities Northeast Utilities
Service Company Service Company
P.O. Box 270 P.O. Box 270
Hartford, Connecticut Hartford, Connecticut
06141-0270 06141-0270
ITEM 1 DESCRIPTION OF PROPOSED TRANSACTIONS
BACKGROUND
1. By Order dated November12, 1998 (HCAR No. 35-26939), in File No. 70-
9343, the Commission, among other things, authorized (i) the formation and
financing by Northeast Utilities ("NU") of a nonutility subsidiary company
(which is referred to therein as "Newco" but which is now known as NU
Enterprises, Inc. ("NUEI")) which will engage, through multiple subsidiaries,
in a variety of energy related and other activities and (ii) the acquisition
by NUEI of the securities of GENCO (now known as Northeast Generation
Company), Northeast Generation Services, Inc. (now known as Northeast
Generation Service Company), HEC Inc., Mode 1 Communications, Inc. and Select
Energy, Inc. (collectively the "Nonutility Subsidiaries").
2. By Order dated November 20, 1996 (HCAR No. 35-26612), Supplemental
Order dated February 11, 1997 (HCAR No. 35-26665), Supplemental Order dated
March 25, 1997 (HCAR No.35-26692), Supplemental Order dated May 29, 1997
(HCAR No.35-26721) and Supplemental Order dated January 16, 1998 (HCAR No.
35-26816) in this File No. 70-8875, the Commission, among other things,
authorized the continued use, through December 31, 2000, of the Northeast
Utilities System Money Pool ("Money Pool") to assist in meeting the short
team borrowing needs of the Applicants and certain other subsidiaries of NU.
The Applicants propose to modify the Money Pool to enable NUEI and the other
Nonutility Subsidiaries to become participants in the Money Pool.
3. This post-effective amendment to the Application is filed to obtain
authorization for the proposed changes to the Money Pool described above.
AMENDMENTS TO THE APPLICATION
To reflect the foregoing, the Application/Declaration in this
proceeding, as previously amended, is further amended as follows:
4. Paragraph 1 is deleted in its entirety and replaced with the
following:
"1. Northeast Utilities ("NU"), a public utility holding
company registered under the Public Utility Holding Company Act of 1935,
as amended (the "Act"), and The Connecticut Light & Power Company
("CL&P"), Western Massachusetts Electric Company ("WMECO"), Public
Service Company of New Hampshire ("PSNH"), Holyoke Water Power Company
("HWP"), and North Atlantic Energy Corporation ("NAEC"), each of which
is a wholly-owned subsidiary of NU (each of NU, CL&P, WMECO, PSNH, HWP
and NAEC, are sometimes herein called an "Applicant," and collectively
all such companies are herein called "Applicants"), and NU Enterprises,
Inc. ("NUEI"), a wholly owned nonutility subsidiary of NU, and Northeast
Generation Company ("NGC"), Northeast Generation Service Company
("NGS"), Select Energy, Inc. ("Select") and Mode 1 Communications, Inc.
("Mode 1"), each of which is a wholly owned subsidiary of NUEI (NUEI,
NGS, NGC, Select and Mode 1 are sometimes herein collectively referred
to as the "Nonutility Subsidiaries") submit this application/declaration
(the "Application") pursuant to Sections 6(a), 7, 9(a), 10 and 12 of the
Act and Rules 43 and 45 thereunder with respect to (a) certain
transactions related to the issuance of notes by NU, CL&P and WMECO to
evidence borrowings under a new revolving credit facility (the
"Facility") aggregating up to $450 million, (b) an increase and
extension to December 31, 2000 of the respective short-term borrowing
limits of the Applicants and (c) participation by the Nonutility
Subsidiaries in the Money Pool."
5. The first three sentences of paragraph 13 are deleted and replaced
with the following:
"13. The Applicants propose to continue using, and the Nonutility
Subsidiaries propose participating in, the Money Pool, which is
administered on their behalf by Northeast Utilities Service Company
("NUSCO") under the direction of an officer in the NUSCO Treasury
Organization. The Money Pool currently consists principally of surplus
funds that may be available from day to day to the Applicants, including
NU and to the Nonutility Subsidiaries. The funds available to the Money
Pool will be loaned on a short-term basis to those Applicants, other
than NU, to the Nonutility Subsidiaries and to the Non-Applicant
Companies, that have a need for short-term funds, subject to certain
limitations described therein."
6. Paragraph 14 is deleted in its entirety and replaced with the
following:
"14. In addition to surplus funds, funds borrowed by NU through
the issuance of the Short-Term Notes, by selling commercial paper or by
borrowing under the Facility described in paragraphs 2 to 5 above are a
source of funds for making open account advances to certain of its
subsidiaries through the Money Pool. NU requests that its authority for
such borrowings be extended through December 31, 2000. The potential
recipients of such open account advances will be PSNH, NAEC, HWP, NUEI,
NGS, NGC, Select, Mode 1, NNECO, Quinnehtuk, RR and HEC. (1) Such
arrangements have in the past resulted in a reduction in borrowing costs
to the recipients because NU has access to funds at lower interest rates
than the subsidiaries listed above and/or because the transaction costs
of arranging several small financings to meet the needs of the smaller
subsidiaries are higher than the costs of arranging one larger financing
by NU. The amounts to be borrowed by NU for the purpose of making open
account advances and to be borrowed through the Money Pool by the
Applicants, the Nonutility Subsidiaries and the Non-Applicant Companies
will also be subject to the short-term limits on the aggregate amount
outstanding for which approval is sought in this filing."
7. Paragraph 17 is deleted in its entirety and replaced with the
following:
"17. Money Pool transactions will be designed to match, on a
daily basis, the available cash and short-term borrowing requirements of
the Applicants and the Nonutility Subsidiaries, thereby minimizing the
need for short-term borrowings to be made by the Applicants (other than
NU) and the Nonutility Subsidiaries from external sources. To this end,
it is anticipated that the short-term borrowing requirements of the
Applicants (other than NU) and the Nonutility Subsidiaries will be met,
in the first instance, with the proceeds of borrowings available through
the Money Pool, and thereafter, to the extent necessary, with the
proceeds of external short-term borrowings, as described below. Those
participants in the Money Pool without access to the commercial paper
market will have priority as borrowers from the Money Pool, and only
PSNH, NAEC, HWP, NUEI, NGS, NGC, Select, Mode 1, NNECO, Quinnehtuk, RR
and HEC will be eligible to borrow through the Money Pool from the
proceeds of external borrowings by NU. If at any time there are funds
remaining in the Money Pool after satisfaction of the borrowing needs of
the borrowers, NUSCO, as agent for the Money Pool, will invest those
funds as described in paragraph 13 and allocate the earnings on any such
investments among the Money Pool participants, providing such excess
funds on a pro rata basis according to the amount of the funds so
provided."
8. Paragraph 27 is deleted in its entirety and replaced with the
following:
"27. The aggregate amount of short-term debt that will be
outstanding at any one time, whether evidenced by Short-Term Notes
issued to lending institutions or by Commercial Paper or through
borrowings from the Money Pool pursuant to the authority requested in
this Application or through borrowings through revolving credit
facilities described in paragraphs 2 through 5 and paragraph 29, for
which Commission authorization is being sought will not exceed $200
million in the case of NU, $375 million in the case of CL&P, $150
million in the case of WMECO, $225 million in the case of PSNH, $5
million in the case of HWP, $60 million in the case of NAEC, $75 million
in the case of NUEI, $50 million in the case of Select, $5 million in
the case of NGC, $5 million in the case of NGS and $5 million in the
case of Mode 1."
9. The second sentence of Paragraph 29 is deleted and replaced with the
following:
"HWP, NNECO, NUEI, NGS, NGC, Select, Mode 1 and RR will not be parties
to the Facility, although NU may borrow for these companies, as well as
for NAEC, Quinnehtuk and HEC, through the Money Pool."
ITEM 4. REGULATORY APPROVALS
10. No other state or federal commission has jurisdiction with respect
to, nor are any codes of conduct issued by any such commission applicable to,
any aspect of the proposed transaction and, assuming the Commission
authorizes and approves all aspects of such transactions, no Federal
commission other than the Securities and Exchange Commission has jurisdiction
with respect to any aspect thereof.
ITEM 5. PROCEDURE
11. The Applicants hereby waive any recommended decision by a hearing
officer or by any other responsible officer of the Commission and waive the
30-day waiting period between issuance of the Commission's order and the date
on which it is to become effective, since it is desired that the Commission's
order, when issued, become effective immediately. The Applicants consent
that the Office of Public Utility Regulation within the Division of
Investment Management may assist in the preparation of the Commission's
decision and/or order.
ITEM 6. EXHIBITS AND FINANCIAL STATEMTENTS
12. The following additional exhibits and financial statements are
filed herewith:
(a) Exhibits
A.7 Terms of the NU System Money Pool (Revised February 1999)
I.2 Proposed Form of Notice
(b) Financial Statements
The pro-forma effect on NU's financial statements of the proposed
amendments authorizing the additional companies to participate in the
Money Pool is not material and therefore no new financial statements are
filed.
SIGNATURES
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, as amended, the undersigned have duly caused this Amendment to be
signed on behalf of each of them by the undersigned thereunto duly
authorized.
Date: March 3, 1999
NORTHEAST UTILITIES
THE CONNECTICUT LIGHT AND POWER COMPANY
WESTERN MASSACHUSETTS ELECTRIC COMPANY
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
HOLYOKE WATER POWER COMPANY
NORTH ATLANTIC ENERGY CORPORATION
NU ENTERPRISES, INC.
NORTHEAST GENERATIONCOMPANY
NORTHEAST GENERATION SERVICE COMPANY
SELECT ENERGY, INC.
MODE 1 COMMUNICATIONS, INC.
By:/s/David R. McHale
David R. McHale
Vice President and Treasurer
EXHIBIT A.7
PROPOSED TERMS OF THE NU MONEY POOL
(Revised February, 1999)
GENERAL
1. The members of the Money Pool (the Pool) are Northeast Utilities
(NU), The Connecticut Light and Power Company (CL&P), Western Massachusetts
Electric Company (WMECO), Northeast Nuclear Energy Company (NNECO), Holyoke
Water Power Company (HWP), The Rocky River Realty Company (RRR), The
Quinnehtuk Company (Quinnehtuk), Public Service Company of New Hampshire
(PSNH), North Atlantic Energy Corporation (North Atlantic), HEC Inc. (HEC),
Mode 1 Communications, Inc. (Mode 1), Select Energy, Inc. (Select), NU
Enterprises, Inc. (NUEI), Northeast Generation Company (NGC), and Northeast
Generation Services Company (NGS).
2. The Pool will be administered by Northeast Utilities Service
Company (Agent).
3. Each member will determine each day, on the basis of cash flow
projections, the amount of surplus funds it has available for contribution to
the Pool (Surplus Funds). In addition to its own Surplus Funds, NU may
borrow funds from third party lenders (Excess Funds) in order to make these
Excess Funds available to meet the borrowing needs of NNECO, HWP, RRR,
Quinnehtuk, PSNH, North Atlantic, HEC, Mode1, Select, NUEI, NGC, and NGS.
CONTRIBUTIONS TO THE POOL
4. Each member will contribute its Surplus Funds to the Pool. NU
will contribute any Excess Funds to the Pool.
5. Each member will receive as interest with respect to its Surplus
Funds that fraction of the total interest received by the Pool equal to the
ratio of the Surplus Funds the member has contributed, times the period in
which such Surplus Funds were available, to the total Surplus Funds in the
Pool, times the period in which all Surplus Funds were in the Pool. NU will
receive the same interest with respect to its Excess Funds that it pays for
its Excess Funds. Such interest will be computed on a daily basis and
settled once per month.
6. Each member may withdraw any of its Surplus Funds at any time
without notice. NU may withdraw its Excess Funds at any time without notice.
BORROWINGS FROM THE POOL
7. NU Shall not be entitled to borrow from the Pool.
8. PSNH and North Atlantic shall not be entitled to borrow Surplus
Funds that are attributable to contributions from WMECO until the
Massachusetts Department of Public Utilities has issued an order authorizing
WMECO to lend funds to PSNH or NAEC, as the case may be, through the Pool.
9. All short-term borrowing needs of members other than NU, which
shall not be entitled to borrow from the Pool and PSNH, and North Atlantic,
which may borrow only subject to the conditions set forth in paragraph 8,
will be met by Surplus Funds in the Pool to the extent such funds are
available. NNECO, HWP, RRR, Quinnehtuk, PSNH, North Atlantic, Mode 1,
Select, NUEI, NGC, NGS and HEC may meet their short-term borrowing needs
through Excess Funds made available from NU.
10. Loans will be made first to borrowers that cannot access the
commercial paper market.
11. Members borrowing Surplus Funds will pay interest at a rate equal
to the daily composite Federal funds rate. The rate to be used for weekends
and holidays will be the prior business day's rate. Members borrowing Excess
Funds will pay interest at the same rate that NU pays for those Excess Funds.
12. Loans made by the Pool will be open account advances for periods of
less than 12 months, although the Agent may receive upon demand a promissory
note evidencing the transaction.
13. All loans made by the Pool from Surplus Funds are payable on demand
by the Agent.
14. All loans made by the Pool from Surplus Funds may be prepaid by the
borrower without penalty. No loans from Excess Funds shall be prepaid prior
to the maturity of the NU borrowing that resulted in the Excess Funds, unless
the prepayment can be made without NU incurring additional costs or unless
the prepayment is accompanied by payment of any additional costs incurred by
NU as a result of such prepayment.
15. If there are more Surplus Funds in the Pool than are necessary to
meet the borrowing needs of the members, the Agent will use the Surplus Funds
to meet the NU system's compensating balance requirements or invest them on
behalf of the Pool directly, or indirectly through an investment fund, in one
of the following instruments:
(a) obligations issued or guaranteed by the United States of
America;
(b) obligations issued or guaranteed by any person controlled,
sponsored by, or supervised by and acting as an instrumentality of
the United States of America pursuant to authority granted by the
Congress of the United States, including but not limited to the
obligations of the Government National Mortgage Association (GNMA),
Student Loan Marketing Association (SLMA), Federal Home Loan
Mortgage Corporation (FHLMC) and Federal National Mortgage
Association (FNMA);
(c) obligations issued or guaranteed by any state or political
subdivision thereof, provided that such obligations are rated for
investment purposes at not less than "A" by Moody's Investors
Service, Inc. ("Moody's") or by the Standard & Poor's Rating Group
("S&P");
(d) certificates of deposit issued or banker's acceptances drawn
on and accepted by commercial banks which are members of the
Federal Deposit Insurance Corporation and which have a combined
capital, surplus and undistributed profits of at least
$100,000,000;
(e) commercial paper rated not less than "P-1" by Moody's or not
less than "A-1" by S&P;
(f) repurchase agreements with any commercial or investment bank
secured by obligations issued or guaranteed by the United States of
America or an instrumentality thereof provided collateral is held
by a third party; and
(g) such other instruments as are permitted by Rule 40(a)(1) under
the Act and approved by the Massachusetts Department of Public
Utilities (the "DPU") pursuant to Massachusetts General Laws
Chapter 164, Section 17A and the regulations thereunder.
TERMINATION
16. Any member may terminate its participation in the Pool at any time
without notice.
Exhibit I.2
PROPOSED FORM OF NOTICE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Release No. 35- / , 1999
Filings Under the Public Utility Holding Company Act of 1935 ("Act")
Notice is hereby given that the following filing(s) has/have been made
with the Commission pursuant to provisions of the Act and rules promulgated
thereunder. All interested persons are referred to the application(s) and/or
declaration(s) for complete statements of the proposed transaction(s)
summarized below. The application(s) and/or declaration(s) and any
amendment(s) thereto is/are available for public inspection through the
Commission's Office of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in writing by
, 1998 to the Secretary, Securities and Exchange Commission, Washington, D.C.
20549, and serve a copy on the relevant applicant(s) and/or declarant(s) at
the address(es) specified below. Proof of service (by affidavit or, in case
of an attorney at law, by certificate) should be filed with the request. Any
request for hearing shall identify specifically the issues of fact or law
that are disputed. A person who so requests will be notified of any hearing,
if ordered, and will receive a copy of any notice or order issued in the
matter. After said date, the application(s) and/or declaration(s), as filed,
or as amended, may be granted and/or permitted to become effective.
Northeast Utilities, et al.
(70-8875)
Northeast Utilities ("NU"), a public utility holding company registered
under the Public Utility Holding Company Act of 1935, as amended (the "Act"),
and The Connecticut Light & Power Company ("CL&P"), Western Massachusetts
Electric Company ("WMECO"), Public Service Company of New Hampshire ("PSNH"),
Holyoke Water Power Company ("HWP"), North Atlantic Energy Corporation
("NAEC"), and NU Enterprises, Inc. ("NUEI"), each of which is a wholly-owned
subsidiary of NU, and Northeast Generation Company ("NGC"), Northeast
Generation Service Company ("NGS"), Select Energy, Inc. ("Select") and Mode 1
Communications, Inc. ("Mode 1"), each a wholly owned nonutility subsidiary of
NUEI, and collectively with NUEI, the "Nonutility Subsidiaries" (the
"Applicants"), have filed an amendment to their application/declaration (the
"Application") with this Commission. NU and WMECO are located at 174 Brush
Hill Avenue, West Springfield, Massachusetts 01090-0010, CL&P, NUEI, NGS,
NGC, Select and Mode 1 are located at 107 Selden Street, Berlin, Connecticut
06037, PSNH and NAEC are located at 1000 Elm Street, Manchester, NH 03105 and
HWP is located at Canal Street, Holyoke, MA 01040.
By order of the Commission dated November 20, 1996 (HCAR No. 35-26612),
Supplemental Order dated February 11, 1997 (HCAR No. 35-26665), Supplemental
Order dated March 25, 1997 (HCAR No.35-26692), Supplemental Order dated May
29, 1997 (HCAR No.35-26721) and Supplemental Order dated January 16, 1998
(HCAR No. 35-26816), the Commission authorized, among other things the
continued use of the Northeast Utilities System Money Pool (the "Money
Pool"), which is composed of available funds loaned by the participating
subsidiaries and borrowed by those subsidiaries to assist in meeting their
respective short-term borrowing needs, through December 31, 2000.
Authorization is requested at this time for the Applicants to continue to
participate in the Money Pool and to allow the Nonutility Subsidiaries of NU
to participate in the Money Pool. Another potential component of the Money
Pool is funds borrowed by NU through the issuance of Short-Term Notes, by
selling Commercial Paper or by borrowing through the Facility (or existing
revolving credit agreements if all are not terminated when the new Facility
becomes effective) for the purpose of making open account advances through
loans through the Money Pool. The Applicants request authorization for NUEI,
NGC, NGS, Select and Mode 1 to participate in the Money Pool.
All borrowings from and contributions to the Money Pool will be
documented and will be evidenced on the books of each Applicant that is
borrowing from or contributing surplus funds to the Money Pool. Except for
loans from the proceeds of external borrowings by NU, all loans made under
the Money Pool will bear interest for both the borrower and lender, payable
monthly, equal to the daily Federal Funds Effective Rate as quoted by the
Federal Reserve Bank of New York. Loans from the proceeds of external
borrowings by NU will bear interest at the same rate paid by NU on the
borrowings, and no such loans may be prepaid (unless NU is made whole for any
additional costs that may be incurred because of such prepayment). To the
extent that there are any excess funds available in the Money Pool, such
funds will be invested with the earnings allocated on a pro rata basis.
For the Commission, by the Division of Investment Management, pursuant
to delegated authority.
