Exhibit 10.10.10
Composite/Conformed Copy
2001 Amendatory Agreement
This 2001 Amendatory Agreement, dated as of September 21,
2001 between VERMONT YANKEE NUCLEAR POWER CORPORATION ("Vermont
Yankee"), a Vermont corporation, and [each of Cambridge Electric
Light Company, a Massachusetts corporation, Central Maine Power
Company, a Maine corporation, Central Vermont Public Service
Corporation, a Vermont corporation, The Connecticut Light and
Power Company, a Connecticut corporation, Green Mountain Power
Corporation, a Vermont corporation, New England Power Company, a
Massachusetts corporation, Public Service Company of New
Hampshire, a New Hampshire corporation, and Western Massachusetts
Electric Company, a Massachusetts corporation] (the
"Purchaser"), amending both the Power Contract, dated February 1,
1968, as heretofore amended by eight amendments dated June 1,
1972, April 15, 1983, April 24, 1985, June 1, 1985, May 6, 1988,
June 15, 1989 and December 1, 1989 between Vermont Yankee and the
Purchaser (the "Power Contract") and the Additional Power
Contract, dated as of February 1, 1984, between Vermont Yankee
and the Purchaser (the "Additional Power Contract").
For good and valuable consideration, the receipt of which is
hereby acknowledged, it is agreed as follows:
1. Basic Understandings.
Vermont Yankee was organized in 1966 to provide for the
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 510 megawatts electric (the "Unit") at a site in
Vernon, Vermont. Vermont Yankee was issued a full-term, Facility
Operating License for the Unit by the Atomic Energy Commission
(now the Nuclear Regulatory Commission, which, together with any
successor agencies, is hereafter called the "NRC"), which license
is now stated to expire on March 21, 2012 (the "End of License
Term"). The Unit has been in commercial operation since December
1, 1972 and continues to operate.
The names of the Purchasers of Vermont Yankee and their
respective interests ("entitlement percentages") in Vermont
Yankee and the net capacity and output of the Unit are as
follows:
Purchaser Entitlement Percentage
Central Vermont Public Service Corporation 35.0%
Green Mountain Power Corporation 20.0%
New England Power Company 22.5%
The Connecticut Light and Power Company 9.5%
Central Maine Power Company 4.0%
Public Service Company of New Hampshire 4.0%
Western Massachusetts Electric Company 2.5%
Cambridge Electric Light Company 2.5%
The Unit was conceived to supply economic power on a cost of
service formula basis to the Purchasers. Pursuant to the Power
Contract, Vermont Yankee has agreed to supply to the Purchaser
and, pursuant to separate power contracts substantially identical
to the Power Contract except for the names of the parties
(collectively, as amended through the date hereof, the "Initial
Power Contracts"), to the other Purchasers all of the capacity
and the electric energy available from the Unit for a thirty year
term extending through November 30, 2002.
Pursuant to the Additional Power Contract, Vermont Yankee
has agreed to supply to the Purchaser, and pursuant to separate
additional power contracts substantially identical to the
Additional Power Contract except for the names of the parties
(collectively, as amended through the date hereof, the
"Additional Power Contracts"), to the other Purchasers all the
capacity and electric energy available from the Unit during an
operative term stated to commence on December 1, 2002 (when the
Initial Power Contracts terminate) and extending until a date
which is 30 days after the later of the date on which the last of
the financial obligations of Vermont Yankee has been extinguished
or the date on which Vermont Yankee is finally relieved of any
obligations under the last of the licenses (operating or
possessory) which it holds, or hereafter receives, from the NRC
with respect to the Unit. The Additional Power Contracts also
provide, in the event of their earlier cancellation, that the
decommissioning cost obligation and the other applicable
provisions of the Additional Power Contracts shall remain in
effect to permit final billings of costs incurred prior to such
cancellation.
Pursuant to the Initial Power Contracts and the Additional
Power Contracts, the Purchasers are entitled and obligated to
take their respective entitlement percentages of the capacity and
net electrical output of the Unit during the service life of the
Unit and are obligated to pay therefor monthly their respective
entitlement percentages of Vermont Yankee's cost of service,
including decommissioning costs, whether or not the Unit is
operated.
On August 14, 2001, the Board of Directors of Vermont
Yankee, which includes representatives of the Purchasers
(including the Purchaser), after conducting a thorough review of
the economics of continued operation of the Unit until End of
License Term in comparison to other alternatives (including the
early shut-down of the Unit) available to Vermont Yankee and
evaluating the competing bids received in a formal auction of the
Unit commenced in April, 2001, voted to approve a Purchase and
Sale Agreement (the "PSA"), dated as of August 15, 2001, among
Vermont Yankee and Entergy Nuclear Vermont Yankee, LLC ("ENVY")
and Entergy Corporation, as guarantor, pursuant to which the Unit
and related assets of Vermont Yankee, including a pre-funded
decommissioning trust, would be sold to ENVY. The PSA also
provided that Vermont Yankee would enter into a Power Purchase
Agreement (the "PPA") with ENVY to purchase 100% of the actual
net output of the Unit up to its present operating level of
approximately 510 megawatts electric, together with the related
ancillary products available from the Unit, for a period from the
Effective Date (as hereinafter defined) to the End of License
Term or the earlier shutdown of the Unit, all such energy and
ancillary products to be resold at wholesale by Vermont Yankee to
the Purchasers pursuant to the Initial Power Contracts and the
Additional Power Contracts as amended hereby.
As a consequence of the PSA and the PPA, Vermont Yankee and
the Purchaser propose to further amend the Power Contract and the
Additional Power Contract in various respects in order (i) to
release Vermont Yankee from any further obligations under said
contracts with respect to the operation and decommissioning of
the Unit, (ii) to clarify and confirm provisions for the recovery
under said contracts of the remaining unamortized costs
previously incurred by Vermont Yankee in providing capacity and
energy from the Unit prior to the Effective Date, (iii) to
provide for the recovery of any costs or liabilities assumed by
Vermont Yankee under the PSA and PPA and of Vermont Yankee's on-
going administrative expenses, and (iv) to provide for the resale
at cost by Vermont Yankee to the Purchaser of the Purchaser's
entitlement percentage of the aforesaid output and ancillary
products of the Unit to be purchased by Vermont Yankee from ENVY
pursuant to the PPA.
Vermont Yankee and the Purchaser have agreed to enter into
this 2001 Amendatory Agreement. Concurrently herewith each of the
other Purchasers is entering into an amendatory agreement which
is identical hereto except for the necessary changes in the names
of the parties.
2. Parties' Contractual Commitments.
Vermont Yankee and the Purchaser each acknowledge that the
other has faithfully performed its obligations under the Power
Contract. The Purchaser hereby reconfirms its obligations under
the Power Contract and the Additional Power Contract to pay its
entitlement percentage of Vermont Yankee's unamortized costs of
the Unit as deferred payment in connection with the capacity and
net electrical output of the Unit previously delivered by Vermont
Yankee and agrees that the decision to sell the Unit as described
in Section 1 hereof did not give rise to any cancellation right
under Section 9 of the Power Contract or Section 10 of the
Additional Power Contract. Vermont Yankee and the Purchaser
further agree that the Purchaser shall continue to be entitled
and obligated to purchase its entitlement percentage of the
aforesaid output and ancillary products available from the Unit
during the terms of the Power Contract and Additional Power
Contract as hereinafter provided, and to pay a like percentage of
Vermont Yankee's costs therefor, and that Vermont Yankee shall
continue to be obligated to resell such output and ancillary
products to the Purchaser during such terms. Recognizing that
the PSA, by transferring ownership and operating responsibility
for the Unit, changes the nature of the costs that Vermont Yankee
will incur, including those to obtain such output and ancillary
products from the Unit of which a portion is being resold
hereunder to the Purchaser, Vermont Yankee and the Purchaser
further agree that this Amendatory Agreement sets forth the
necessary and appropriate provisions for the continuation of the
foregoing entitlements and obligations.
Except as expressly modified by this Amendatory Agreement,
the provisions of the Power Contract and the Additional Power
Contract remain in full force and effect.
3. Effective Date.
Subject to receipt of FERC approval, this 2001 Amendatory
Agreement shall become effective concurrently with the Closing
under the PSA (the "Effective Date").
4. Power Contract Amendments.
The Power Contract is hereby amended as follows:
(a) In recognition of the sale of the Unit being
effected pursuant to the PSA and the intention of the parties to
release Vermont Yankee from any further obligations with respect
to operation of the Unit, the text of each of Sections 3, 4, 5,
6, 8, 9 and 10 of the Power Contract is hereby deleted and, in
lieu thereof in each instance the words "Intentionally Deleted
and This Section Left Blank" shall be inserted; provided,
however, that the pre-existing text shall remain in effect for
purposes of settling any accounts between the parties for periods
prior to the Effective Date.
(b) A new section 10A is hereby inserted immediately
following Section 10 to read as follows:
"10A. Definitions.
Unless the context otherwise specifies
or requires, capitalized terms not otherwise
defined herein shall have the meanings
provided in the PPA and each term defined
below, when used in this contract, shall have
the meaning indicated below:
"Closing" means the Closing as defined in the PSA.
"Effective Date" has the meaning provided in
Section 3 hereof.
"End of License Term" means March 21, 2012.
"End of Term Date" means the earlier of the
End of License Term or the date on which the
Unit is permanently removed from service.
"ENVY" means Entergy Nuclear Vermont Yankee,
LLC, a Delaware limited liability company.
"Entitlement percentage" has the meaning
provided in Section 1 hereof.
"Future Power" means the aggregate energy, capacity and
ancillary products actually produced by, or available
from, the Unit in accordance with the PPA.
"Net capacity" means for any period the
actual level at which the Unit is operated,
less station service use, transformer losses
and generator lead losses.
"PPA" means the Power Purchase Agreement, dated as of
August 15, 2001, between Vermont Yankee, as buyer, and
ENVY, as seller, a complete copy of which is attached
hereto as Exhibit B.
"PPA Entitlement Percentage" means the Sub-
Entitlement or, if applicable, the portion of
the post-Uprate Company Entitlement (as those
terms are defined in the PPA) allocated to
the Purchaser in accordance with the PPA.
"PPA Obligations" means the obligations of
Vermont Yankee to ENVY under the PPA other
than the purchase price payable pursuant to
Article 5 thereof, a schedule of which is set
forth on Exhibit A hereto.
"PSA" means the Purchase and Sale Agreement, dated as
of August 15, 2001, among Vermont Yankee, ENVY and
Entergy Corporation, as guarantor, as amended from time
to time.
"PSA Obligations" means the obligations of Vermont
Yankee to ENVY under the PSA, a schedule of which is
set forth on Exhibit A hereto.
"PSA Transactions" means the conduct of the auction
process commenced in 2001 to sell the Unit, the
proceedings to obtain regulatory approval of the
transactions resulting from such auction, and the
services of consultants, advisors and legal counsel
with respect thereto.
"Purchasers" means the sponsoring utilities named in
Section 1 hereof or their respective successors or
assigns.
(c) In recognition of the Purchaser's continuing
obligation to reimburse Vermont Yankee for its entitlement
percentage of certain of Vermont Yankee's costs as deferred
payment for the capacity and net electrical output of the Unit
previously delivered by Vermont Yankee and to reflect the change
in the manner in which Vermont Yankee will incur costs to supply
the Purchaser with its aliquot share of the Future Power to be
purchased pursuant to the PPA by Vermont Yankee from ENVY, the
provisions of Sections 7 and 7A of the Power Contract are hereby
deleted and new Sections 7, 7A and 7B are inserted in lieu
thereof as follows:
"7. Reimbursed Costs
With respect to each month during the balance of
the term of this contract, the Purchaser will pay
Vermont Yankee an amount equal to the Purchaser's
entitlement percentage of each of (A) the portion of
Vermont Yankee's Closing Net Unit Investment allocable
to such month, if any, together with one-twelfth of the
composite percentage for such month of the Closing Net
Unit Investment as most recently determined in
accordance with this Section 7, (B) Vermont Yankee's
Total Transaction Costs Obligation, if any, for such
month, (C) Vermont Yankee's total operating expenses
for such month, (D) Vermont Yankee's PSA Obligations,
if any, for such month, (E) Vermont Yankee's PPA
Obligations, if any, for such month, (F) Vermont
Yankee's Total Revolver Costs for such month, if any,
and (G) to the extent not duplicative of any payment
made under clause (A) above, an amount equal to one-
twelfth of the equity percentage for such month of the
Purchaser's entitlement percentage of the equity
investment, as most recently determined in accordance
with this Section 7.
"Composite percentage" shall be computed as of the
Effective 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 most recent computation date. "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 as of such
date is of the total capital as of such date, plus (ii)
the stated interest rate per annum of each principal
amount of indebtedness bearing a particular rate of
interest outstanding on such date for money borrowed
from persons other than Purchasers multiplied by the
percentage which such principal amount is of total
capital as of such date.
"Equity percentage" as of any date shall be whatever
percentage per annum may be authorized from time to
time by FERC.
"Common stock equity investment" as of any date shall
consist of equity investment as of such date less the
aggregate par value of all issues of preferred stock
outstanding on such date.
"Equity investment" as of any date shall consist of the
sum of (i) all amounts theretofore paid to Vermont
Yankee for all capital stock theretofore issued (taken
at the total par value thereof plus the total of all
amounts in an excess of such par value paid thereon);
plus all capital contributions, loans and advances
theretofore made to Vermont Yankee by the Purchasers,
less the sum of any amounts distributed by Vermont
Yankee to the Purchasers or stockholders in the form of
stock repurchases or redemptions, return of capital or
repayments of loans and advances; plus (ii) any credit
balance in the capital surplus account (not included
under (i)) and in earned surplus account on the books
of Vermont Yankee as of such date.
"Total capital" as of any date shall be the equity
investment plus the total of all indebtedness then
outstanding for money borrowed from other than the
Purchasers.
"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 nuclear material.
Vermont Yankee's "operating expenses" shall include all
expenses incurred by Vermont Yankee after the Effective
Date (i) for administrative and general expenses which
would be properly chargeable by an operating electric
utility, less any applicable credits thereto, in
accordance with the Uniform System and (ii) for
expenses, if any, resulting from the settlement of
claims of dissenting shareholders.
The "net Unit investment" shall consist, in each case
with respect to the Unit, of (i) the aggregate amount
properly chargeable at the time in accordance with the
Uniform System of Vermont Yankee's electric plant
accounts (including construction work in progress),
less the sum of (x) the aggregate amount included in
operating expenses from the plant completion date to
the date in question on account of depreciation
accruals (and amortization, if any, of property losses)
reduced by the aggregate of all amounts charged during
such period against the accumulated provision for
depreciation plus (y) the amount of net available cash;
plus (ii) the aggregate amount properly chargeable at
the time in accordance with the Uniform System to
accounts representing fuel assemblies and components
(including nuclear materials) and other materials and
supplies, less the balance, if any, at the time of the
accumulated amortization thereof; plus (iii) such
reasonable allowances for prepaid items and cash
working capital as may from time to time be determined
by Vermont Yankee; less (z) the net proceeds received
from the sale of any assets properly included in said
electric plant accounts. However, for purposes of this
contract, the net amount included at any date after the
plant completion date in net Unit investment under
clause (i) of the immediately preceding sentence shall
in no event be less than the excess of:
(a) the amount properly chargeable at the plant
completion date in accordance with the Uniform
System to electric plant accounts (including
construction work in progress) with respect to the
Unit,
over
(b) the sum of (x) the aggregate minimum amount
required by this Section 7 to be included in
operating expenses from the plant completion date
to the date in question on account of depreciation
accruals (and amortization, if any, or property
losses) plus (y) the amount of net available cash.
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 Vermont
Yankee elects, at more frequent intervals.
"Closing Net Unit Investment" means the amount of net
Unit investment determined as of the Effective Date,
which amount shall be amortized in equal monthly
amounts during the period beginning on the Effective
Date and ending on the End of License Term.
"Net available cash" means, at any date as of which the
amount thereof is to be determined, the excess of (a)
the aggregate amount received by Vermont Yankee after
the plant completion date and prior to two years before
the determination date as insurance proceeds on account
of loss or damage to the Unit or as the proceeds of a
sale or condemnation of a portion of the Unit, over (b)
the aggregate amount expended after the plant
completion date and prior to the determination date on
account of rebuilding, repairs, replacements and
additions to the Unit, provided that insurance proceeds
received with respect to a particular loss shall be
taken into account for purposes of the foregoing
computation only if the amount received with respect to
the loss exceeds $150,000.
"Closing Expenses" means the funds, if any, required to
defray any closing adjustments payable by Vermont
Yankee in accordance with the PSA.
"Sale Costs" means the funds, if any, required to
defray the costs incurred in connection with the pre-
2001 efforts to sell the Unit and the PSA Transactions,
including the refunding of such costs to the Purchasers
to the extent previously billed to, and paid by, the
Purchasers.
"Transaction Costs" means the sum of (a) the Closing
Expenses plus (b) the Sales Costs.
"Total Transaction Costs Obligation" for any month
shall mean the amount attributable to such month for
the payment of principal and interest, if any, on the
Transaction Costs, calculated on the basis of
amortizing such liability in equal monthly amounts over
the period from the Effective Date to the End of
License Term.
"Short-term Revolver" means one or more borrowings by
Vermont Yankee during the term of this contract to
obtain funds to meet short-term operating cash needs.
"Total Revolver Costs" for any month means the amount
attributable to such month for the payment of
principal, interest and other fees, if any, due on the
Short-term Revolver.
7A. Purchase of Future Power, Delivery and Payments.
(a) Purchase of Future Power: With respect to
each month during the period commencing on the
Effective Date and ending on the earlier of the End of
Term Date or the end of the operative term of this
contract, the Purchaser will be entitled and obligated
to take its PPA Entitlement Percentage of the Future
Power. The Purchaser's PPA Entitlement Percentage of
the Future Power will be delivered to and accepted by
it at the Producer's Delivery Point (as defined in the
PPA). 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 share of
the Future Power. In accordance with the PPA, ENVY
will be responsible for maintaining metering and
telemetering with respect to the Future Power.
With respect to each month during the aforesaid
period, Purchaser will pay Vermont Yankee for the
Future Power actually delivered to the Purchaser an
amount equal to its PPA Entitlement Percentage of (a)
the purchase price calculated pursuant to Article 5 of
the PPA plus (b) any applicable Governmental Charges
allocable to Vermont Yankee pursuant to Section 18(b)
of the PPA.
(b) Contingent Option to Terminate Purchase.
Pursuant to Article 4(c) of the PPA, Vermont Yankee was
granted an option to negotiate for release from all or
part of its obligations to purchase power under the PPA
effective as of February 28, 2005 and a further option
to negotiate for release of any balance of such
obligations effective December 31, 2007, each such
option being exercisable by written notice to the ENVY
at least 180 days prior to its effective date (each
such notice date being referred to herein as an
"exercise date"). Those options affect the Sub-
Entitlements of each of the Purchasers. Vermont Yankee
hereby grants the Purchaser the right to direct Vermont
Yankee to exercise such option with respect to the
Purchaser's Sub-Entitlement as follows:
If the Purchaser desires to direct Vermont Yankee
to negotiate the release of the Purchaser's Sub-
Entitlement under the PPA pursuant to such option, the
Purchaser shall give written notice to that effect to
Vermont Yankee at least 90 days in advance of the
relevant exercise date. Upon receipt of such notice
from the Purchaser, Vermont Yankee shall confer with
all other Purchasers giving similar notices to
ascertain the scope of negotiating discretion granted
by such Purchasers and shall thereafter give timely
written notice to the ENVY indicating Vermont Yankee's
desire to negotiate the release of the Sub-Entitlements
of those Purchasers that have given Vermont Yankee the
required notice. Vermont Yankee shall thereafter
negotiate in good faith with the ENVY for release of
said Sub-Entitlements from the PPA and shall maintain
close coordination with the Purchaser and other
affected Purchasers to assure that the terms of such
release are acceptable. Any final release agreement
between Vermont Yankee and the ENVY shall be subject to
ratification by each of the Purchasers affected
thereby. If the Purchaser fails to ratify the release
agreement within the time provided by such agreement,
its Sub-Entitlement shall be excluded from the release
agreement.
Vermont Yankee and the Purchaser hereby further
agree that: (a) after such a release agreement has
been ratified by the Purchaser, the Purchaser will pay
to Vermont Yankee the Purchaser's proportionate share
of the payments, if any, due to the ENVY in connection
with such release; and (b) from and after the effective
date of any release affecting the Purchaser's Sub-
Entitlement Percentage, the Purchaser shall no longer
be obligated, pursuant to clause (a) above, to take and
pay for any Future Power delivered after such effective
date.
(c) ISO Filing. Vermont Yankee agrees to submit
this contract to the market system maintained by the
Independent System Operator of New England provided for
in the NEPOOL Agreement.
(d) Adequate Assurance. In the event that ENVY
exercises its right under Article 7(h) of the PPA to
request adequate assurance with respect to Purchaser's
PPA Entitlement Percentage of the Future Power, then
Vermont Yankee shall be deemed to have commercially
reasonably grounds for insecurity concerning
Purchaser's ability to perform its obligations under
this Section 7A and may provide Purchaser with written
notice requesting adequate assurance ("Adequate
Assurance") of due performance of Purchaser's
obligations under this Section 7A for the benefit of
Vermont Yankee and/or ENVY. Upon receipt of such
notice by mail postage prepaid, facsimile, telecopy or
hand delivery, Purchaser shall have twelve (12)
Business Days to provide such Adequate Assurance to
Vermont Yankee and ENVY.
7B. Billing.
Vermont Yankee will submit, by telecopy or other
agreeable same day delivery mechanism, to the
Purchaser, as soon as practicable after the end of each
month, an invoice for the aggregate amount payable by
the Purchaser pursuant to Sections 7 and 7A hereof 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 payments shown to be due on such invoice,
except amount in dispute, shall be due and payable by
wire transfer per instructions on the invoice on or
before the later of the eighteenth (18th) day of each
month, or the eighth (8th) day after receipt of the
invoice, or if either such day is not a Business Day,
then on the next Business Day.
(d) Section 14 of the Power Contract is hereby amended by
adding the following at the end thereof:
"Notwithstanding the foregoing, (a) Purchaser
(or its assigns) may assign its interest
under Section 7A of this contract only (i) to
a third party that has a credit rating equal
to the higher of that of the assignor or of
investment grade as determined by a
nationally rated service, or (ii) to a single
purpose entity whose obligations hereunder
are guaranteed by a parent that has such a
credit rating, or (iii) in connection with a
merger, consolidation or sale of
substantially all its assets to another party
that has a credit rating at least equal to
that of the Purchaser (or its assigns).
The Purchaser hereby consents to
Vermont Yankee creating a security interest
in Vermont Yankee's interest in this contract
for the benefit of ENVY and/or the lenders
under the Short-term Revolver and agrees that
Purchaser's obligations hereunder shall not
be affected thereby."
(e) Section 20 of the Power Contract is hereby amended by
deleting the first sentence thereof and deleting the word "other"
from the second sentence thereof.
5. Additional Power Contract Amendments.
The Additional Power Contract is hereby amended as follows:
(a) In recognition of the sale of the Unit being effected
pursuant to the PSA and, the intention of the parties to release
Vermont Yankee from any further obligations with respect to
operation of the Unit, the text of each of Sections 3, 4, 5, 6,
8, 9, 10 and 11 of the Additional Power Contract is hereby
deleted and, in lieu thereof in each instance the words
"Intentionally Deleted and This Section Left Blank" shall be
inserted.
(b) A new section 10A is hereby inserted immediately
following Section 10 to read as follows:
"10A. Definitions.
Unless the context otherwise specifies or
requires, capitalized terms not otherwise defined
herein shall have the meanings provided in the PPA and
each term defined below, when used in this contract,
shall have the meaning indicated below:
"Closing" means the Closing as defined in the
PSA.
"Effective Date" has the meaning provided in
Section 3 hereof.
"End of License Term" means March 21, 2012.
"End of Term Date" means the earlier of the
End of License Term or the date on which the
Unit is permanently removed from service.
"ENVY" means Entergy Nuclear Vermont Yankee,
LLC, a Delaware limited liability company.
"Entitlement percentage" has the meaning
provided in Section 1 hereof.
"Future Power" means the aggregate energy,
capacity and ancillary actually produced by,
or available from, the Unit in accordance
with the PPA.
"Initial Power Contracts" means the several
Power Contracts, dated as of February 1,
1968, as amended, between Vermont Yankee and
each of the Purchasers.
"Net capacity" means for any period the actual level at
which the Unit is operated, less station service use,
transformer losses and generator lead losses.
"Operative term" has the meaning provided in Section 2
hereof.
"PPA" means the Power Purchase Agreement, dated as of
August 15, 2001, between Vermont Yankee, as buyer, and
ENVY, as seller, a complete copy of which is attached
hereto as Exhibit B.
"PPA Entitlement Percentage" means the Sub-Entitlement
or, if applicable, the portion of the post-Uprate
Company Entitlement (as those terms are defined in the
PPA) allocated to the Purchaser in accordance with the
PPA.
"PPA Obligations" means the obligations of Vermont
Yankee to ENVY under the PPA other than the purchase
price payable pursuant to Article 5 thereof, a schedule
of which is set forth on Exhibit A hereto.
"PSA" means the Purchase and Sale Agreement, dated as
of August 15, 2001, among Vermont Yankee, ENVY and
Entergy Corporation, as guarantor, as amended from time
to time.
"PSA Obligations" means the obligations of
Vermont Yankee to ENVY, a schedule of which
is set forth on Exhibit A hereto.
"PSA Transactions" means the conduct of the auction
process commenced in 2001 to sell the Unit, the
proceedings to obtain regulatory approval of the
transactions resulting from such auction, and the
services of consultants, advisors and legal counsel
with respect thereto.
"Purchasers" means the sponsoring utilities named
in Section 1 hereof or their respective successors
or assigns.
(c) Section 2 of the Additional Power Contract is hereby
amended in full to read as follows:
"The operative term of this contract shall commence on
December 1, 2002 notwithstanding the fact that the Unit
has been sold to ENVY and shall terminate 30 days after
the date on which the last of the respective financial
obligations of Vermont Yankee and the Purchaser which
constitute elements of the reimbursed costs calculated
pursuant to Section 7 hereof and the purchase price for
Future Power calculated pursuant to Section 7A hereof
has been extinguished."
(d) In recognition of the Purchaser's continuing
obligation to reimburse Vermont Yankee for its aliquot share of
certain of Vermont Yankee's costs as deferred payment for the
capacity and net electrical output of the Unit previously
delivered by Vermont Yankee and to reflect the change in the
manner in which Vermont Yankee will incur costs to supply the
Purchaser with its entitlement percentage of the Future Power to
be purchased pursuant to the PPA by Vermont Yankee from ENVY, the
provisions of Section 7 of the Additional Power Contract are
hereby deleted and new Sections 7, 7A and 7B are inserted in lieu
thereof as follows:
"7. Reimbursed Costs
With respect to each month during the operative
term of this contract, the Purchaser will pay Vermont
Yankee an amount equal to the Purchaser's entitlement
percentage of each of (A) the portion of Vermont
Yankee's Closing Net Unit Investment applicable to such
month, if any, together with one-twelfth of the
composite percentage for such month of the Closing Net
Unit Investment as most recently determined in
accordance with this Section 7, (B) Vermont Yankee's
Total Transaction Costs Obligation, if any, for such
month, (C) Vermont Yankee's total operating expenses
for such month, (D) Vermont Yankee's PSA Obligations,
if any, for such month, (E) Vermont Yankee's PPA
Obligations, if any, for such month, (F) Vermont
Yankee's Total Revolver Costs for such month, if any,
and (G) to the extent not duplicative of any payment
made under clause (A) above, an amount equal to one-
twelfth of the equity percentage for such month of the
Purchaser's entitlement percentage of the equity
investment, as most recently determined in accordance
with this Section 7.
"Composite percentage" shall be computed as of the
Effective 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 most recent computation date. "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 as of such
date is of the total capital as of such date, plus (ii)
the stated interest rate per annum of each principal
amount of indebtedness bearing a particular rate of
interest outstanding on such date for money borrowed
from persons other than Purchasers multiplied by the
percentage which such principal amount is of total
capital as of such date.
"Equity percentage" as of any date shall be whatever
percentage per annum may be authorized from time to
time by FERC.
"Common stock equity investment" as of any date shall
consist of equity investment as of such date less the
aggregate par value of all issues of preferred stock
outstanding on such date.
"Equity investment" as of any date shall consist of
the sum of (i) all amounts theretofore paid to Vermont
Yankee for all capital stock theretofore issued (taken
at the total par value thereof plus the total of all
amounts in an excess of such par value paid thereon);
plus all capital contributions, loans and advances
theretofore made to Vermont Yankee by the Purchasers,
less the sum of any amounts distributed by Vermont
Yankee to the Purchasers or stockholders in the form of
stock repurchases or redemptions, return of capital or
repayments of loans and advances; plus (ii) any credit
balance in the capital surplus account (not included
under (i)) and in earned surplus account on the books
of Vermont Yankee as of such date.
"Total capital" as of any date shall be the equity
investment plus the total of all indebtedness then
outstanding for money borrowed from other than the
Purchasers.
"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 nuclear material.
Vermont Yankee's "operating expenses" shall include all
ordinary and necessary expenses incurred by Vermont
Yankee during the term of this contract (i) for
administrative and general expenses which would be
properly chargeable by an operating electric utility,
less any applicable credits thereto, in accordance with
the Uniform System and (ii) for expenses, if any,
resulting from the settlement of claims of dissenting
shareholders.
The "net Unit investment" shall consist, in each case
with respect to the Unit, of (i) the aggregate amount
properly chargeable at the time in accordance with the
Uniform System of Vermont Yankee's electric plant
accounts (including construction work in progress),
less the sum of (x) the aggregate amount included in
operating expenses from the plant completion date to
the date in question on account of depreciation
accruals (and amortization, if any, of property losses)
reduced by the aggregate of all amounts charged during
such period against the accumulated provision for
depreciation plus (y) the amount of net available cash;
plus (ii) the aggregate amount properly chargeable at
the time in accordance with the Uniform System to
accounts representing fuel assemblies and components
(including nuclear materials) and other materials and
supplies, less the balance, if any, at the time of the
accumulated amortization thereof; plus (iii) such
reasonable allowances for prepaid items and cash
working capital as may from time to time be determined
by Vermont Yankee; less (z) the net proceeds received
from the sale of any assets properly included in said
electric plant accounts. However, for purposes of this
contract, the net amount included at any date after the
plant completion date in net Unit investment under
clause (i) of the immediately preceding sentence shall
in no event be less than the excess of:
(a) the amount properly chargeable at the plant
completion date in accordance with the Uniform
System to electric plant accounts (including
construction work in progress) with respect to the
Unit),
over
(b) the sum of (x) the aggregate minimum amount
required by this Section 7 to be included in
operating expenses from the plant completion date
to the date in question on account of depreciation
accruals (and amortization, if any, or property
losses) plus (y) the amount of net available cash.
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 Vermont
Yankee elects, at more frequent intervals.
"Closing Net Unit Investment" means the amount of net
Unit investment determined as of the Effective Date,
which amount shall be amortized in equal monthly
amounts during the period commencing on the Effective
Date and ending on the End of License Date.
"Net available cash" means, at any date as of which the
amount thereof is to be determined, the excess of (a)
the aggregate amount received by Vermont Yankee after
the plant completion date and prior to two years before
the determination date as insurance proceeds on account
of loss or damage to the Unit or as the proceeds of a
sale or condemnation of a portion of the Unit, over (b)
the aggregate amount expended after the plant
completion date and prior to the determination date on
account of rebuilding, repairs, replacements and
additions to the Unit, provided that insurance proceeds
received with respect to a particular loss shall be
taken into account for purposes of the foregoing
computation only if the amount received with respect to
the loss exceeds $150,000.
"Closing Expenses" means the funds, if any, required to
defray other closing adjustments under the PSA.
"Sales Costs" means the funds, if any, to defray the
costs incurred in connection with pre-2001 efforts to
sell the Unit and the PSA Transactions, including the
refunding of such costs to the Purchasers to the extent
previously billed to, and paid by, the Purchasers.
"Transaction Costs" means the sum of (a) the Closing
Expenses plus (b) the Sale Costs.
"Total Transaction Costs Obligation" for any month
shall mean the amount attributable to such month for
the payment of principal and interest, if any, on the
Transaction Costs, calculated on the basis of
amortizing such liability in equal monthly amounts over
the period from the Effective Date to the End of
License Term.
"Short-term Revolver" means one or more borrowings by
Vermont Yankee during the term of this contract to
obtain funds to meet short-term operating cash needs.
"Total Revolver Costs" for any month means the amount
attributable to such month for payment of principal,
interest and other fees, if any, due on the Short-term
Revolver.
7A. Purchase of Future Power, Delivery and Payments.
(a) Purchase of Future Power: With respect to
each month during the period commencing on December 1,
2002 and ending on the End of Term Date, the Purchaser
will be entitled and obligated to take its PPA
Entitlement Percentage of the Future Power. The
Purchaser's PPA Entitlement Percentage of the Future
Power will be delivered to and accepted by it at the
Producer's Delivery Point (as defined in the PPA). 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 shares of the
Future Power. In accordance with the PPA, ENVY will be
responsible for maintaining metering and telemetering
with respect to the Future Power.
With respect to each month during the aforesaid
period, Purchaser will pay Vermont Yankee for the
Future Power actually delivered to the Purchaser an
amount equal to its PPA Entitlement Percentage of (a)
the purchase price calculated pursuant to Article 5 of
the PPA plus (b) any applicable Governmental Charges
allocable to Vermont Yankee pursuant to Section 18(b)
of the PPA.
(b) Contingent Option to Terminate Purchase.
Pursuant to Article 4(c) of the PPA, Vermont Yankee was
granted an option to negotiate for release from all or
part of its obligations to purchase power under the PPA
effective as of February 28, 2005 and a further option
to negotiate for release of any balance of such
obligations effective December 31, 2007, each such
option being exercisable by written notice to the ENVY
at least 180 days prior to its effective date (each
such notice date being referred to herein as an
"exercise date"). Those options affect the Sub-
Entitlements of each of the Purchasers. Vermont Yankee
hereby grants the Purchaser the right to direct Vermont
Yankee to exercise such option with respect to the
Purchaser's Sub-Entitlement as follows:
If the Purchaser desires to direct Vermont Yankee
to negotiate the release of the Purchaser's Sub-
Entitlement under the PPA pursuant to such option, the
Purchaser shall give written notice to that effect to
Vermont Yankee at least 90 days in advance of the
relevant exercise date. Upon receipt of such notice
from the Purchaser, Vermont Yankee shall confer with
all other Purchasers giving similar notices to
ascertain the scope of negotiating discretion granted
by such Purchasers and shall thereafter give timely
written notice to the ENVY indicating Vermont Yankee's
desire to negotiate the release of the Sub-Entitlements
of those Purchasers that have given Vermont Yankee the
required notice. Vermont Yankee shall thereafter
negotiate in good faith with the ENVY for release of
said Sub-Entitlements from the PPA and shall maintain
close coordination with the Purchaser and other
affected Purchasers to assure that the terms of such
release are acceptable. Any final release agreement
between Vermont Yankee and the ENVY shall be subject to
ratification by each of the Purchasers affected
thereby. If the Purchaser fails to ratify the release
agreement within the time provided by such agreement,
its Sub-Entitlement shall be excluded from the release
agreement.
Vermont Yankee and the Purchaser hereby further
agree that: (a) after such a release agreement has
been ratified by the Purchaser, the Purchaser will pay
to Vermont Yankee the Purchaser's proportionate share
of the payments, if any, due to the ENVY in connection
with such release; and (b) from and after the effective
date of any release affecting the Purchaser's Sub-
Entitlement Percentage, the Purchaser shall no longer
be obligated, pursuant to clause (a) above, to take and
pay for any Future Power delivered after such effective
date.
(c) ISO Filing. Vermont Yankee agrees to submit
this contract to the market system maintained by the
Independent System Operator of New England provided for
in the NEPOOL Agreement.
(d) Adequate Assurance. In the event that ENVY
exercises its right under Article 7(h) of the PPA to
request adequate assurance with respect to Purchaser's
PPA Entitlement Percentage of the Future Power, then
Vermont Yankee shall be deemed to have commercially
reasonably grounds for insecurity concerning
Purchaser's ability to perform its obligations under
this Section 7A and may provide Purchaser with written
notice requesting adequate assurance ("Adequate
Assurance") of due performance of Purchaser's
obligations under this Section 7A for the benefit of
Vermont Yankee and/or ENVY. Upon receipt of such
notice by mail postage prepaid, facsimile, telecopy or
hand delivery, Purchaser shall have twelve (12)
Business Days to provide such Adequate Assurance to
Vermont Yankee and ENVY.
7B. Billing.
Vermont Yankee will submit, by telecopy or other
agreeable same day delivery mechanism, to the
Purchaser, as soon as practicable after the
end of each month, an invoice for the aggregate amount
payable by the Purchaser pursuant to Sections 7 and 7B
hereof 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 payments shown to be
due on such invoice, except amounts in dispute, shall
be due and payable by wire transfer per instructions on
the invoice on or before the later of the eighteenth
(18th) day of each month, or the eighth (8th) day after
receipt of the invoice, or if either such day is not a
Business Day, then on the next Business Day.
(e) Section 15 of the Additional Power Contract is hereby
amended by adding the following to the end thereof:
"Notwithstanding the foregoing, (a) Purchaser (or its
assigns) may assign its interest under Section 7A of
this contract only (i) to a third party that has a
credit rating equal to the higher of that of the
assignor or of investment grade as determined by a
nationally rated service, or (ii) to a single purpose
entity whose obligations hereunder are guaranteed by a
parent that has such a credit rating, or (iii) in
connection with a merger, consolidation or sale of
substantially all its assets, to another party that has
a credit rating at least equal to that of the Purchaser
(or its assigns).
The Purchaser hereby consents to Vermont Yankee
creating a security interest in Vermont Yankee's
interest in this contract for the benefit of ENVY
and/or the lenders under the Short-term Revolver and
agrees that Purchaser's obligations hereunder shall not
be affected by thereby."
(f) Section 17 of the Additional Power Contract is hereby
amended by deleting the first sentence thereof and deleting the
word "other" from the second sentence thereof.
6. Government Regulation. This Amendatory Agreement and all
rights and obligations of the Parties hereunder are subject to
all applicable federal, state and local laws and all duly
promulgated orders and duly authorized actions of governmental
authorities having proper and valid jurisdiction over the terms
of this Amendatory Agreement. Purchaser will be obligated to
make all payments to Vermont Yankee for purchases at wholesale of
capacity, energy and ancillary products hereunder regardless of
whether or not the Purchaser is permitted to pass along or
recover those payments from its customers. Each of Vermont
Yankee and Purchaser shall not propose, advance or support, and
shall vigorously oppose and defend against, any action by any
legislature, agency, commission, (including the Federal Energy
Regulatory Commission), entity or court that would adversely
affect the Parties' rights and benefits hereunder and each of
Vermont Yankee and the Purchaser will vigorously pursue all
actions and remedies to overturn or cure any such action. In
addition, the rates, terms, and conditions contained in this
Amendatory Agreement are not subject to change under Sections 205
or 206 of the Federal Power Act, as either section may be amended
or superseded, absent the mutual written agreement of the Parties
or a finding by the Federal Energy Regulatory Commission, that
this Amendatory Agreement is not in the public interest.
7. Confidentiality. Except as otherwise required by law or for
implementation of this Amendatory Agreement, the Parties must
keep confidential the transactions undertaken pursuant hereto;
provided, however, that the Purchaser may disclose such
information on a confidential basis to third parties in
connection with good faith negotiation for the assignment of
Purchaser's interests hereunder. Nothing herein shall preclude
the Purchaser from disclosing the substance of this Amendatory
Agreement to third parties on a confidential basis in connection
with the negotiation of the assignment of any of its interests
herein. Any information provided by either Party to the other
Party pursuant to this Amendatory Agreement and labeled
"CONFIDENTIAL" will be used by the receiving Party solely in
connection with the purposes of this Amendatory Agreement and
will not be disclosed by the receiving Party to any third party,
except with the providing Party's consent. This Section 7 of
this Amendatory Agreement will not prevent either Party from
providing any confidential information received from the other
Party to any court or in accordance with a proper discovery
request or in response to the reasonable request of any
governmental agency with jurisdiction to regulate or investigate
the disclosing Party's affairs, provided that, if feasible, the
disclosing Party will give prior notice to the other Party of
such disclosure and, if so requested by such other Party, will
have used all reasonable efforts to oppose or resist the
requested disclosure, as appropriate under the circumstances, or
to otherwise make such disclosure pursuant to a protective order
or other similar arrangement for confidentiality.
8. Miscellaneous.
(a) Mitigation of Damages. In the event of any default
by Purchaser, Vermont Yankee shall have the right to sell the
Purchaser's entitlement percentage of any energy and ancillary
products and apply the proceeds thereof against the amounts owing
from the Purchaser.
(b) Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties have executed this Amendment
by their respective officers hereto duly authorized, as of the
date first above written.
VERMONT YANKEE NUCLEAR POWER
CORPORATION
By /s/ Bruce W. Wiggett
Bruce W. Wiggett
Senior Vice President of Finance
and Administration
Address: Box 169, Ferry Road
Brattleboro, VT 05301
CAMBRIDGE ELECTRIC LIGHT COMPANY
By /s/ Russell D. Wright
Russell D. Wright
President
Address: 800 Boylston Street
Boston, MA 02199
CENTRAL MAINE POWER COMPANY
By /s/ Curtis I. Call
Curtis I. Call
Treasurer
Address: 83 Edison Drive
Augusta, ME 04336
THE CONNECTICUT LIGHT AND POWER
COMPANY
By /s/ John B. Keane
John B. Keane
Vice President/Administration
Address: P. O. Box 270
Hartford, CT 06141-0270
GREEN MOUNTAIN POWER CORPORATION
By /s/ C. L. Dutton
C. L. Dutton
President and Chief Executive
Officer
Address: 163 Acorn Lane
Colchester, VT 05446
CENTRAL VERMONT PUBLIC SERVICE
CORPORATION
By /s/ Kent R. Brown
Kent R. Brown
Senior Vice President,
Engineering & Operations
Address:: 77 Grove Street
Rutland, VT 05701
NEW ENGLAND POWER COMPANY
By /s/ Terry L. Schwennesen
Terry L. Schwennesen
Vice President
Address:
PUBLIC SERVICE COMPANY OF
NEW HAMPSHIRE
By /s/ John B. Keane
John B. Keane
Vice President - Administration
Address:: P. O. Box 270
Hartford, CT 06141-0270
WESTERN MASSACHUSETTS ELECTRIC
COMPANY
By /s/ John B. Keane
John B. Keane
Vice President - Administration
Address:: P. O. Box 270
Hartford, CT 06141-0270
Exhibit A
to
2001 Amendatory Agreement
I. PSA Obligations:
The PSA Obligations comprise those set forth in the following
sections of the PSA:
Section 2.4 Excluded Liabilities
Section 6.11(b) One-time fee due to DOE under the DOE Standard Contract
Section 6.12 DOE Decontamination and Decommissioning fees
Section 9.1 Indemnification obligations
II. PPA Obligations:
The PPA Obligations comprise those set forth in the
following sections of the PPA:
Section 3(g) Transmission charges for Station Use Energy.
Section 7(h) Adequate assurance
Section 9 Indemnification obligations
Exhibit B
to
2001 Amendatory Agreement
[Attach copy of PPA]