FILE NO. 70-8875
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 14
TO
FORM U-1
(AMENDMENT NO. 16)
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
NU Enterprises, Inc. of 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
Yankee Energy System, Inc. The Rocky River Realty Company
Yankee Gas Services Company The Quinnehtuk Company
Yankee Energy Financial Services Company Northeast Nuclear Energy Company
NorConn Properties, Inc. 107 Selden Street
Yankee Energy Services Company Berlin, CT 06037
R. M. Services, Inc.
599 Research Parkway
Meriden, Connecticut 06450 HEC Inc.
24 Prime Parkway
Natick, MA 01760
(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, CT 06141-0270
(Name and address of agent for service)
The Commission is requested to mail signed copies of all orders, notices and
communications to
Jeffrey C. Miller David R. McHale
Assistant General Counsel Vice President and Treasurer
Northeast Utilities Northeast Utilities
Service Company Service Company
P.O. Box 270 P.O. Box 270
Hartford, CT 06141-0270 Hartford, CT 06141-0270
BACKGROUND
1. By Order dated November 20, 1996 (HCAR No. 35-26612) and Supplemental
Orders dated February 11, 1997, March 25, 1997, May 29, 1997, January 16,
1998, May 13, 1999 and November 17, 1999, issued by the Commission in this
File No. 70-8875, the Commission, among other things, authorized (i) the
participation of the companies in the Northeast Utilities holding company
system in a money pool administered by Northeast Utilities Service Company
and (ii) short-term borrowing limits for Northeast Utilities ("NU"), The
Connecticut Light and Power Company and Western Massachusetts Electric
Company and others for the period to and including December 31, 2000.
2. NU and its subsidiaries (collectively, the "Applicants") now wish to
further amend this Application/Declaration by filing this Post-Effective
Amendment No. 14 (this "Amendment") to:
(a) seek Commission authorization for Yankee Energy System, Inc.
("YES"), Yankee Gas Services Company ("Yankee Gas"), Yankee Energy Financial
Services Company, NorConn Properties, Inc., Yankee Energy Services Company
and R.M. Services, Inc. to participate in the NU System Money Pool as such
companies have become direct or indirect subsidiaries of NU pursuant to the
merger of YES with NU on March 1, 2000, and to clarify the inclusion of
Northeast Nuclear Energy Company, The Quinnehtuk Company, The Rocky River
Realty Company and HEC Inc. as participants in the NU System Money Pool.
(b) seek authorization for YES and Yankee Gas to incur short-term debt
through December 31, 2000, subject to the limits and on the terms as
described herein.
(c) Eliminate any maximum limit on borrowings by nonutility subsidiaries
from the NU System Money Pool.
AMENDMENTS TO THE APPLICATION (Footnote 1)
To reflect the foregoing, the Application/Declaration, as amended in this
proceeding, is further amended as follows:
3. To add the Yankee Subsidiaries to the Application/Declaration, the
following sentence is added to the end of paragraph 1.
"Yankee Energy System, Inc. ("YES"), which became a wholly-owned holding
company subsidiary of NU on March 1, 2000 (See File No. 70-9535), and Yankee
Gas Services Company ("Yankee Gas"), Yankee Energy Financial Services Company
("Yankee Financial"), Yankee Energy Service Company ("Yesco"), NorConn
Properties, Inc. ("NorConn") and R.M. Services, Inc. ("RMS"), each of which
is a wholly-owned subsidiary of YES (YES, Yankee Gas, Yankee Financial,
Yesco, NorConn and RMS are sometimes herein collectively referred to as the
"Yankee Subsidiaries"), join in the submission of this Application with
respect to (a) establishing a short-term borrowing limit for YES and Yankee
Gas (collectively, the "Yankee Borrowers"), (b) participation by the Yankee
Subsidiaries in the Money Pool, and (c) incurring of short-term debt by the
Yankee Borrowers through December 31, 2000."
4. To seek short-term borrowing authority for the Yankee Borrowers, the
following new paragraph 1B is added after paragraph 1A.
_________________________________
Footnote(1)
The original Application/Declaration in Northeast Utilities, et. al, File
No. 70-8875 (dated as of June 19, 1996), has been amended fifteen (15)
times: (i) Amendment No. 1, dated as of October 30, 1996, (ii) Amendment No.
2, dated as of November 19, 1996, (iii) Post-Effective Amendment No. 1
(Amendment No. 3), dated as of January 28, 1997, (iv) Post-Effective
Amendment No. 2 (Amendment No. 4), dated as of April 23, 1997, (v) Post-
Effective Amendment No. 3 (Amendment No. 5), dated as of May 16, 1997, (vi)
Post-Effective Amendment No. 4 (Amendment No. 6), dated as of May 27, 1997,
(vii) Post-Effective Amendment No. 5 (Amendment No. 7), dated as of May 28,
1997, (viii) Post-Effective Amendment No. 6 (Amendment No. 8), dated as of
May 30, 1997, (ix) Post-Effective Amendment No. 7 (Amendment No. 9), dated as
of November 20, 1997, (x) Post-Effective Amendment No. 8 (Amendment No. 10),
dated as of December 31, 1997, (xi) Post-Effective Amendment No. 9 (Amendment
No. 11), dated as of January 14, 1998, (xii) Post-Effective Amendment No. 10
(Amendment No. 12), dated as of March 3, 1999, (xiii) Post-Effective
Amendment No. 11 (Amendment No. 13), dated as of September 7, 1999, (xiv)
Post-Effective Amendment No. 12 (Amendment No. 14) dated as of October 26,
1999 and (xv) Post-Effective Amendment No. 13 (Amendment No. 15) dated as of
November 17, 1999.
"1B. The Yankee Borrowers hereby seek authorization to engage in certain
financing transactions for which the specific terms and conditions are not
known at this time, and which may not be covered by Rule 52, without further
approval by the Commission through the Authorization Period. The short-term
borrowings of the Yankee Borrowers have taken and will take a variety of
forms, including short-term notes issued to bank and non-bank lending
institutions through formal and informal credit lines, commercial paper
issuances, open-account advances by NU and use of the NU System Money Pool.
The following general terms will be applicable to the financing transactions
requested to be authorized hereby. The effective cost of money on borrowings
occurring pursuant to the authorization granted under this Application will
not exceed 400 basis points over the base rate in effect from time to time of
the bank or financial institution identified for such purpose with respect to
the relevant financing or, if no such base rate is identified, the base rate
in effect from time to time of a representative money center bank. The
maturity of debt incurred will not exceed 364 days. The fees, commissions, or
other similar remuneration paid in connection with the issuance of such debt
or the entering into of credit facilities with respect to debt incurred
pursuant to the Application will not exceed 3% of the principal amount of
such debt. Borrowings from banks and other financial institutions may be
either unsecured or secured. To the extent required, the provision of any
collateral to secure debt incurred pursuant to this Application will be
approved by applicable state regulatory commissions. Specific terms of any
borrowings will be determined by the Yankee Borrowers at the time of issuance
and will comply in all regards to the parameters of financing authorizations
set forth above. A copy of any note or agreement executed pursuant to this
Authorization will be filed under cover of the next quarterly report under
Rule 24. The funds to be derived by the Yankee Borrowers from short-term
borrowings authorized by the Commission pursuant to this Application will be
applied, with other funds available to those companies, to provide working
capital and for general corporate purposes."
5. To provide that NNECO, the Quinnehtuk Company, RR and HEC Inc. may borrow
through the NU System Money Pool, paragraph 9 is deleted in its entirety and
replaced with the following new paragraph 9.
"9. NNECO, The Quinnehtuk Company ("Quinnehtuk"), RR and HEC Inc. ("HEC")
are wholly owned subsidiaries of NU and, to the extent an exemption provided
by Rule 52 under the Act is unavailable, seek authorization to participate in
(including borrowing funds from) the NU System Money Pool."
6. To restate the terms of the NU System Money Pool to take into account
these changes, paragraphs 13 through 19 are deleted in their entirety and
replaced with the following new paragraphs 13 through 19.
"13. NU, CL&P, WMECO, PSNH, NAEC, HWP, NUEI, NGS, NGC, Select, HEC, NNECO,
Quinnehtuk, RR and Mode 1 ("the "Original Participants") propose to continue
using, and the Yankee Subsidiaries propose participating in, the NU System
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 Original Participants and the Yankee Subsidiaries
are referred collectively herein as the "Pool Participants"). The NU System
Money Pool currently consists principally of surplus funds that may be
available from day to day to the Pool Participants, including NU. The funds
available to the NU System Money Pool will be loaned on a short-term basis to
those Pool Participants, other than NU, YES, Mode 1 and NGC (NU's only exempt
wholesale generator), that have a need for short-term funds, subject to
certain limitations described therein. If no such short-term needs match the
amount of funds that are available for the period such funds are available,
the funds in the NU System Money Pool will be invested directly or indirectly
through investment funds in:
(a) obligations issued or guaranteed by the United States of America;
(b) obligations issued or guaranteed by any entity 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 Telecommunications and
Energy (the "MDTE") pursuant to Massachusetts General Laws Chapter 164,
Section 17A and the regulations thereunder.
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 1A to 5 above are a
source of funds for making open account advances to certain of its
subsidiaries through the NU System Money Pool. The potential recipients of
such open account advances will be all Pool Participants with the exception
of CL&P, WMECO, Mode 1 and NGC. 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 or to be lent through the Money
Pool to the Pool Participants, will also be subject to the short-term limits
on the aggregate amount outstanding for which approval is sought in this
filing.
15. PSNH and NAEC will not be entitled to borrow funds through the NU
System Money Pool that are attributable to contributions from WMECO unless
and until the MDTE has issued an order authorizing WMECO to lend funds to
PSNH or NAEC, as the case may be, through the NU System Money Pool.
16. The Pool Participants request that the Commission reserve
jurisdiction over any PSNH and NAEC borrowings of NU System Money Pool funds
attributable to contributions thereto by WMECO until such time as the MDTE
has issued an order authorizing such borrowings. Without such an order,
WMECO may not lend money to PSNH or NAEC through the Money Pool. In the
event that such an order is received from the MDTE, the Pool Participants
will file a post-effective amendment hereto seeking the necessary Commission
approval.
17. Money Pool transactions will be designed to match, on a daily
basis, the available cash of the Pool Participants and the short-term
borrowing requirements of certain Pool Participants (other than NU, YES, NGC
and Mode 1), thereby minimizing the need for short-term borrowings to be made
by the Pool Participants from external sources. To this end, it is
anticipated that the short-term borrowing requirements of the Pool
Participants (other than NU, YES, NGC and Mode 1) will be met, in the first
instance, with the proceeds of borrowings available through the NU System
Money Pool, and thereafter, to the extent necessary, with the proceeds of
external short-term borrowings, as described below. Those participants in
the NU System Money Pool without access to external borrowing facilities will
have priority as borrowers from the NU System Money Pool, and all Pool
Participants, other than CL&P, WMECO, Mode 1 and NGC, will be eligible to
borrow through the NU System Money Pool from the proceeds of external
borrowings by NU. If at any time there are funds remaining in the NU System
Money Pool after satisfaction of the borrowing needs of the borrowers,
NUSCO, as agent for the NU System Money Pool, will invest those funds as
described in paragraph 13 and allocate the earnings on any such investments
among the Pool Participants, providing such excess funds on a pro rata basis
according to the amount of the funds so provided
18. All borrowings from and contributions to the NU System Money Pool,
including the open account advances, will be documented and will be evidenced
on the books of each participant that is borrowing from or contributing
surplus funds to the NU System Money Pool. Any participant contributing
funds to the NU System Money Pool may withdraw those funds at any time
without notice to satisfy its daily need for funds. Except for loans from
the proceeds of external borrowings by NU, all loans will be payable on
demand, may be prepaid by any borrowing Pool Participant at any time without
premium or penalty and 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 its
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. NU will be
fully reimbursed for all costs that it incurs in relation to loans made to
the Pool Participants.
19. The Applicants believe that the cost of the proposed borrowings
through the NU System Money Pool will generally be more favorable to the
borrowing Pool Participants than the comparable cost of external short-term
borrowings, and that the yield to the Pool Participants contributing
available funds to the NU System Money Pool will generally be the same as the
typical yield on short-term investments. However, if on any given day the
funds available through the NU System Money Pool are insufficient to satisfy
the short-term borrowing requirements of a Pool Participant, such Pool
Participant may effect short-term borrowings through lending institutions
and/or through the sale of commercial paper, if appropriate, as described
below."
7. To set out the applicable short-term borrowing limits and eliminate the
limits previously imposed on the nonutility subsidiaries, paragraph 27 is
deleted in its entirety and replaced with the following new paragraph 27.
"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 NU System
Money Pool pursuant to the authority requested in this Application or through
borrowings through revolving credit facilities described in paragraphs 1A
through 5 and paragraph 29, for which Commission authorization is being
sought will not exceed $400 million in the case of NU, $375 million in the
case of CL&P, $250 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 NNECO, $50 million in the case of YES and $100 million
in the case of Yankee Gas. The Pool Participants request that there be no
limit placed on the NU System Money Pool borrowings of RR, Quinnehtuk, HEC,
NUEI, Select, NGS, Yankee Financial, Yesco, RMS and NorConn (the "Nonutility
Participants"). A limit on the Nonutility Participants may result in
unnecessary borrowings by the NU system. Such unnecessary borrowings may
occur when some Pool Participants have money invested in the NU System Money
Pool but other Nonutility Participants need to borrow in excess of pre-
established limits. The excess borrowing must be made directly from NU with
funds borrowed from external sources while excess funds in the money pool are
invested with third parties. This results in an inefficient use of funds by
the NU System as a whole. A similar request was made by Conectiv and
approved by the Commission in HCAR NO. 27111 (December 14, 1999)."
ITEM 2. FEES, COMMISSION AND EXPENSES
8. See Exhibit K.4 attached hereto.
ITEM 3. APPLICABLE STATUORY PROVISIONS
9. Borrowings from the NU System Money Pool are subject to the requirements
of Sections 6, 7, 9(a), 10 and 12 of the Act and Rules 43, 45 and 52
thereunder. Loans to the Money Pool are subject to the requirements of
Sections 9(a), 10 and 12 of the Act.
ITEM 4. REGULATORY APPROVALS
10. No state commission or agency has jurisdiction with respect to any
aspect of the proposed transaction and, assuming the Commission authorizes
and approves all aspects of such transactions (including the accounting
therefor), 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 request that the Commission publish a notice under
Rule 23 with respect to the filing of this Application as soon as practicable
and that the Commission's order be issued as soon as possible. A form of
notice suitable for publication in the Federal Register is attached hereto as
Exhibit h.1. The Applicants respectfully request the Commission's approval,
pursuant to this Application/Declaration, of all transactions described
herein, whether under the sections of the Act and Rules thereunder enumerated
in Item 3 or otherwise. It is further requested that the Commission issue an
order authorizing the transactions proposed herein at the earliest
practicable date but in any event not later than June 1, 2000. Additionally,
the Applicants (i) request that there not be any recommended decision by a
hearing officer or by any responsible officer of the Commission, (ii) consent
to the Office of Public Utility Regulation within the Division of Investment
Management assisting in the preparation of the Commission's decision, and
(iii) waive the 30-day waiting period between the 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.
.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS
12. The following additional exhibits and financial statements are filed
herewith:
(a) Exhibits
A.9 Proposed Terms of the NU Money Pool (Revised March 2000)
F.6 Opinion of Counsel related to matters described in Post-Effective
Amendment No. 14.
K.4 Schedule of Fees, Commissions and Expenses relating to matters described
on Post-Effective Amendment No. 14.
I.4 Form of Notice
Statement Pursuant to Rule 54
13. Except in accordance with the Act, neither NU nor any subsidiary thereof
(a) has acquired an ownership interest in an exempt wholesale generator
("EWG") or a foreign utility company ("FUCO") as defined in Sections 32 and
33 of the Act, or (b) now is or as a consequence of the transactions proposed
herein will become a party to, or has or will as a consequence of the
transactions proposed herein have a right under, a service, sales, or
construction contract with an EWG or a FUCO. None of the proceeds from the
transactions proposed herein will be used by NU and its subsidiaries to
acquire any securities of, or any interest in, an EWG or a FUCO.
NU and its subsidiaries are in compliance with Rule 53(a), (b), and (c),
as demonstrated by the following determinations:
(i) NU's aggregate investment in EWGs and FUCOs (i.e., amounts invested in
or committed to be invested in EWGs and FUCOs, for which there is recourse to
NU), does not exceed 83% of NU and its subsidiaries' consolidated retained
earnings ("CREs") as reported for the four most recent quarterly periods on
NU's Form 10-K and 10-Qs, as authorized by order of the Commission dated
March 7, 2000 (HCAR No. 27148).
(ii) Northeast Generation Company ("NGC", NU's only EWG or FUCO at this
time) maintains books and records, and prepares financial statements in
accordance with Rule 53(a)(2). Furthermore, NU has undertaken to provide the
Commission access to such books and records and financial statements, as it
may request.
(iii) No employees of NU's public utility subsidiaries have rendered
services to NGC.
(iv) NU has submitted (a) a copy of each Form U-1 and Rule 24 certificate
that has been filed with the Commission under Rule 53 and (b) a copy of Item
9 of the Form U5S and Exhibits G and H thereof to each state regulator having
jurisdiction over the retail rates of NU's public utility subsidiaries.
(v) Neither NU nor any subsidiary has been the subject of a bankruptcy or
similar proceeding unless a plan of reorganization has been confirmed in such
proceeding. In addition, NU's average CREs for the four most recent
quarterly periods have not decreased by 10% or more from the average for the
previous four quarterly periods (at December 31, 1998, NU's CREs were $561
million; at December 31, 1999, NU's CREs were $582 million). .
(vi) In the previous fiscal year, NU did not report operating losses
attributable to its investment in EWGs/FUCOs exceeding 3 percent of NU's
consolidated retained earnings.
SIGNATURES
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, as amended, the undersigned have duly caused this Post-Effective
Amendment to be signed on behalf of each of them by the undersigned thereunto
duly authorized.
Date: April 27, 2000
NORTHEAST UTILITIES
WESTERN MASSACHUSETTS ELECTRIC COMPANY
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
HOLYOKE WATER POWER COMPANY
NORTH ATLANTIC ENERGY CORPORATION
NU ENTERPRISES, INC.
NORTHEAST GENERATION COMPANY
NORTHEAST GENERATION SERVICE COMPANY
SELECT ENERGY, INC.
MODE 1 COMMUNICATIONS, INC.
NORTHEAST NUCLEAR ENERGY COMPANY
THE ROCKY RIVER REALTY COMPANY
THE QUINNEHTUK COMPANY
YANKEE ENERGY SYSTEM, INC.
YANKEE GAS SERVICES COMPANY
YANKEE FINANCIAL SERVICES COMPANY
YANKEE ENERGY SERVICES COMPANY
NORCONN PROPERTIES, INC.
By : /S/David R. McHale
Name: David R. McHale
Title: Vice President and Treasurer
HEC INC.
By : /S/David R. McHale
Name: David R. McHale
Title: Assistant Treasurer
R. M. SERVICES, INC.
By : /S/Gregory C. Picklesimer
Name: Gregory C. Picklesimer
Title: Secretary and Treasurer
Pursuant to the requirements of the Public Utility Holding Company Act of
1935, as amended, the undersigned has duly caused this Post-Effective
Amendment to be signed on its behalf by the undersigned thereunto duly
authorized.
Date: April 27, 2000
THE CONNECTICUT LIGHT AND POWER COMPANY
By: /s/Randy A. Shoop
Randy A. Shoop
Treasurer
Exhibit A.9
PROPOSED TERMS OF THE NU MONEY POOL
(Revised April, 2000)
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 (RR), 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), Northeast
Generation Services Company (NGS), Yankee Energy Systems, Inc. (YES), Yankee
Gas Services Company (Yankee Gas), Yankee Energy Financial Services Company
(Yankee Financial), NorConn Properties, Inc. (NorConn), Yankee Energy
Services Company (Yesco) and RMS Services, Inc. (RMS) (collectively, Pool
Participants).
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 the Pool Participants
other than CL&P, WMECO, Mode 1 and NGC.
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. Neither NU, YES, NGC nor Mode 1 Shall 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 Telecommunications and Energy or other appropriate
Massachusetts regulatory agency which regulates WMECO ("MDTE") has issued an
order authorizing WMECO to lend funds to PSNH or North Atlantic, as the case
may be, through the Pool.
9. All short-term borrowing needs of members other than NU, YES, NGC and
Mode 1, 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. All Pool Participants other than CL&P, WMECO, Mode 1
and NGC may meet their short-term borrowing needs through Excess Funds made
available from NU. The aggregate amount of short-term debt that may be
outstanding at any one time, whether through borrowings from the Money Pool
or otherwise may not exceed $400 million in the case of NU, $375 million in
the case of CL&P, $250 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 NNECO, $50 million in the case of YES and $100 million
in the case of Yankee Gas, or such other amount which may be approved and
authorized by the Securities and Exchange Commission and the respective board
of directors from time to time.
Restrictions on Borrowings under the Pool are summarized as follows:
May Not Borrow from May Not Borrow
NU's External Borrowings from Pool
CL&P NU
WMECO YES
Mode 1 Mode 1
NGC NGC
All other Pool Participants may lend to and borrow from the Pool and from
NU's external borrowings
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 MDTE 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 F.6
April 27, 2000
Securities and Exchange Commission
450 Fifth Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
Re: Northeast Utilities et al.
File No. 70-8875
Ladies and Gentlemen:
I am Assistant General Counsel of Northeast Utilities Service
Company("NUSCO"), a service company affiliate of Northeast Utilities ("NU").
In connection with the transactions contemplated by the
Application/Declaration, as amended, in the above referenced file (the
"Application"), I have acted as counsel to NU, The Connecticut Light and
Power Company ("CL&P"), Western Massachusetts Electric Company ("WMECO"),
Holyoke Water Power Company ("HWP"), Public Service Company of New Hampshire
("PSNH"), North Atlantic Energy Corporation ("NAEC") Yankee Energy System,
Inc. ("YES") and Yankee Gas Services Company ("Yankee Gas") and the other
applicants described therein (collectively, the "Applicants"). This opinion
is given to you with respect to the transactions described in Amendment No.
16 (Post-Effective Amendment No. 14) (the "Amendment") pursuant to your
Instructions as to Exhibits to applications and declarations filed on Form U-
1. Except as otherwise defined herein, terms used herein shall have the
meanings given them in the Application.
In connection with this opinion, I have reviewed or caused to be
reviewed the Application, including the Amendment, and the exhibits thereto,
the Applicants' charter documents, as amended to the date of this opinion,
the proceedings of their shareholders and boards of directors to date and
such other papers, documents and records, and have made or caused to be made
such examination of law, as I deemed relevant and necessary in order to give
this opinion. I have assumed that in respect of the Application an
appropriate order of the Commission under the Public Utility Holding Company
Act of 1935 will be issued and all actions of the Applicants will be in
conformity therewith.
The opinions set forth herein are qualified in their entirety as
follows: (a) every opinion rendered herein is expressly subject to the
consummation of such transactions in accordance with the Application using
documents substantially similar to those filed with the Application; (b) no
opinion is expressed as to any laws other than the federal laws of the United
States and the laws of the States of Connecticut and New Hampshire and of the
Commonwealth of Massachusetts; (c) insofar as any opinion relates to the
Declaration of Trust of NU or the Certificate of Incorporation or Bylaws of
any other Applicant, I have assumed that the Declaration of Trust and that
Certificate and those Bylaws will not be amended between now and the time the
transactions contemplated by the Application are consummated; and (d) no
opinion is expressed as to the securities laws of any state.
Based on and subject to the foregoing, I am of the opinion that:
1. All state laws applicable to each of the transactions for which the
Commission's approval is sought in the Amendment will have been complied with
at the time each transaction is consummated.
2. Each of the Yankee Subsidiaries are validly organized and duly
existing under the laws of the State of Connecticut and any debt securities
issued by any such Yankee Subsidiary pursuant to the authorization sought in
the Amendment will be the valid and binding obligation of such company.
3. Debt securities acquired through the NU System Money Pool pursuant
to the authorization sought in the Amendment will be legally acquired.
4. The consummation of the transactions for which the Commission's
approval is sought in the Amendment will not violate the legal rights of the
holders of any securities issued by any of the Applicants or any associate
company of such Applicants.
I hereby consent to the use of this opinion in connection with the
filing of the Application.
I am a member of the Bar of the State of New York. As to matters
involving the laws of other jurisdictions, I have made a study of such laws
and consulted with lawyers employed by NUSCO who are admitted to the Bars of
such other jurisdictions.
Very truly yours,
/s/ Jeffrey C. Miller
Jeffrey C. Miller
Assistant General Counsel
Northeast Utilities Service Company
Exhibit K.4
SCHEDULE OF FEES, COMMISSIONS AND EXPENSES
FOR TRANSACTIONS PROPOSED IN POST-EFFECTIVE
AMENDMENT NO.13, OTHER THAN AS DESCRIBED THEREIN
Northeast Utilities Service Company
(Legal, Financial, Accounting and Other Services) Not in excess of $10,000
EXHIBIT I.4
PROPOSED FORM OF NOTICE
(Release No. 35 - ; 70 - 8875)
POST EFFECTIVE AMENDMENT NO. 14
TO
FORM U-1
(AMENDMENT NO. 16)
APPLICATION/DECLARATION UNDER THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
, 2000
Northeast Utilities ("NU"), a public utility holding company
registered under the Public Utility Holding Company Act of 1935, as amended
("the Act"), The Connecticut Light and Power Company ("CL&P"), Public Service
Company of New Hampshire ("PSNH"), Western Massachusetts Electric Company
("WMECO"), and North Atlantic Energy Corporation ("NAEC"), each an electric
utility subsidiary of NU, and Northeast Nuclear Energy Company ("NNECO"), The
Rocky River Realty Company ("RR"), The Quinnehtuk Company ("Quinnehtuk"), and
NU Enterprises, Inc. ("NUEI"), a sub-holding company over NU's non-utility
subsidiaries, Northeast Generation Company ("NGC"), Northeast Generation
Services Company ("NGS"), Select Energy, Inc. ("SE"), Mode 1 Communications,
Inc. ("Mode 1") and HEC Inc. ("HEC"), and Yankee Energy System, Inc. ("YES"),
a sub-holding company under NU, and its subsidiaries Yankee Gas Services
Company ("Yankee Gas"), Yankee Energy Financial Services Company ("Yankee
Financial"), NorConn Properties, Inc. ("NorConn"), Yankee Energy Services
Company ("YesCo") and R.M. Services, Inc. ("RMS"), and Holyoke Water Power
Company ("HWP"), have filed with the Commission a post-effective amendment
(the "Amendment") to their Application/Declaration in File No. 70-8875
pursuant to the Act. NU and WMECO are located at 174 Brush Hill Avenue, West
Springfield, Massachusetts 01090-0010, CL&P, NUEI, NGC, NGS, SE, NNECO, RR,
Quinnehtuk and Mode 1 are located at 107 Selden Street, Berlin, Connecticut
06037, PSNH and NAEC are located at 1000 Elm Street, Manchester, New
Hampshire 03105, YES, Yankee Gas, Yankee Financial, YesCo, NorConn and RMS
are located at 599 Research Parkway, Meriden, Connecticut, 06450, HEC is
located at 24 Prime Parkway in Natick Massachusetts and Holyoke Water Power
Company is located at 1 Canal Street, Holyoke, MA 01040.
In the Amendment, the Applicants seek Commission authorization for
Yankee Gas and YES to incur short-term debt, all on the terms set forth in
the Application through and including December 31, 2000, as authorized by the
Commission for NU, WMECO and CL&P by Order dated November 20, 1996 (HCAR No.
35-26612) and Supplemental Orders dated February 11, 1997 (HCAR No. 35-
26665), March 25, 1997 (HCAR No. 35-26692), May 29, 1997 (HCAR No. 35-26721),
January 16, 1998 (HCAR No. 35-26816) and May 13, 1999 (HCAR No. 35-27004) in
this File No. 70-8875. The short-term borrowings for Yankee Gas and YES
(collectively, the "Yankee Borrowers") will take a variety of forms,
including short-term notes issued to bank and non-bank lending institutions
through formal and informal credit lines, commercial paper issuances, open-
account advances by NU to certain of its subsidiaries and use of the NU
system money pool.
The Yankee Borrowers request authorization to engage in certain
financing transactions for which the specific terms and conditions are not
known at this time, and which may not be covered by Rule 52, without further
approval by the Commission. The following general terms will be applicable
to the financing transactions requested to be authorized. The effective cost
of money on borrowings occurring pursuant to the authorization granted under
the Application will not exceed 400 basis points over the base rate in effect
from time to time of the bank or financial institution identified for such
purpose with respect to the relevant financing or, if no such base rate is
identified, the base rate in effect from time to time of a representative
money center bank. The maturity of debt incurred will not exceed 364 days.
The fees, commissions, or other similar remuneration paid in connection with
the issuance of such debt or the entering into of credit facilities with
respect to debt incurred pursuant to the Application will not exceed 3% of
the principal amount of such debt. Borrowings from banks and other financial
institutions may be either unsecured or secured. To the extent required, the
provision of any collateral to secure debt incurred pursuant to the
Application will be approved by applicable state regulatory commissions.
Specific terms of any borrowings will be determined by the Yankee Borrowers
at the time of issuance and will comply in all regards to the parameters of
financing authorizations set forth above. A copy of any note or agreement
executed pursuant to the authorization will be filed under cover of the next
quarterly report under Rule 24.
In addition, 1) YES, Yankee Gas, RMS, Yankee Financial, YesCo, NorConn,
Quinnehtuk, HEC, RR and NNECO seek Commission authorization to participate in
the money pool for companies in the NU System; and 2) the Applicants seek the
elimination of the maximum limitations on the borrowings by the direct and
indirect nonutility subsidiaries of the NU System from the NU System Money
Pool.
The Amendment and any further amendments thereto are available for
public inspection through the Commission's Office of Public Reference. Any
interested persons wishing to comment or request a hearing on the Amendment
should submit their views in writing by , 2000, to the Secretary,
Securities and Exchange Commission, Washington D.C. 20549, and serve a copy
on the Applicants at the addresses specified above. Proof of service (by
affidavit or, in the 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 this matter. After said date, the Amendment as filed or
as it may be amended, may be permitted to become effective.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
/s/
Secretary
