Exhibit 10.10.2
Form of
Amendment No. 2 to
Vermont Yankee Power Contract
AMENDMENT, dated as of April 15, 1983, between VERMONT YANKEE NUCLEAR
POWER CORPORATION ("Vermont Yankee"), a Vermont corporation and
(the "Purchaser") to the Power Contract,
dated as of February 1, 1968, as amended as of June 1, 1972, between
Vermont Yankee and the Purchaser.
It is agreed that, in order to provide for the accrual of an
appropriate fund for decommissioning the Vermont Yankee nuclear generating
plant at the end of its useful life, said Power Contract is hereby amended
as follows:
1. The second paragraph of Section 7 is hereby amended to insert
the clause "or, in the case of payments under clause (b) below, commencing on
or after the date authorized by FERC" and the clause "plus (b) the Total
Decommissioning Costs for the month with respect to the Unit," and to
reletter the two final clauses, so that the entire paragraph reads as
follows:
"With respect to each month commencing on or after the plant
completion date or, in the case of payments under clause (b)
below, commencing on or after the date authorized by FERC, the
Purchaser will pay Vermont Yankee an amount equal to the
Purchaser's entitlement percentage of the sum of (a) Vermont
Yankee's total fuel costs for the month with respect to the Unit,
plus (b) the Total Decommissioning Costs for the month with
respect to the Unit, plus (c) Vermont Yankee's total operating
expenses for the month with respect to the Unit, plus (d) an
amount equal to one-twelfth of the composite percentage for such
month of the net Unit investment as most recently determined in
accordance with this Section 7."
2. Section 7 is further amended by inserting therein immediately
preceding the ultimate paragraph thereof the following three paragraphs:
"Total Decommissioning Costs" for any month shall mean the
sum of (x) an amount equal to all accruals in such month to any
reserve, as from time to time established by Vermont Yankee and
approved by its board of directors, to provide for the ultimate
payment of the Decommissioning Expenses of the Unit plus
(y) Decommissioning Tax Liability for such month. It is
understood (i) that such funds may be held by Vermont Yankee or,
if required, by an independent trust or other separate fund, as
determined by said board of directors, (ii) that, upon compliance
with Section 20 hereof, the amount, custody and/or timing of such
accruals may from time to time during the term hereof be modified
by said board of directors in its discretion or to comply with
applicable statutory or regulatory requirements or to reflect
changes in the amount, custody or timing of anticipated
Decommissioning Expenses, and (iii) that the use of the term "to
decommission" herein encompasses compliance with all requirements
(other than those relating to spent nuclear fuel) of the Nuclear
Regulatory Commission or its successors (NRC) for permanent
cessation of operation of a nuclear facility.
"Decommissioning Expenses" shall include:
(1) All costs and expenses of removing the Unit from service,
including without limitation, dismantling, mothballing,
removing radioactive material (excluding spent nuclear fuel)
to temporary and/or permanent storage sites,
decontaminating, restoring and supervising the site, and any
costs and expenses incurred in connection with proceedings
before governmental regulatory authorities relating to any
authorization to decommission the Unit or remove the Unit
from service;
(2) All costs of labor and services, whether directly or
indirectly incurred, including without limitation services
of foremen, inspectors, supervisors, surveyors, engineers,
security personnel, counsel and accountants, performed or
rendered in connection with the decommissioning of the Unit
and the removal of the Unit from service, and all costs of
materials, supplies, machinery, construction equipment and
apparatus acquired or used (including rental charges for
machinery, equipment or apparatus hired) for or in
connection with the decommissioning of the Unit and the
removal of the Unit from service, and all administrative
costs, including services of counsel and financial advisers,
of any applicable independent trust or other separate fund;
it being understood that any amount, exclusive of proceeds
of insurance, realized by Vermont Yankee as salvage on any
machinery, construction equipment and apparatus, the cost of
which was charged to Decommissioning Expense, shall be
treated as a reduction of the amounts otherwise chargeable
on account of the costs of decommissioning of the Unit; and
(3) All overhead costs applicable to the Unit during its
decommissioning period, including, without limiting the
generality of the foregoing, taxes (other than taxes on or
in respect of income), licenses, excises, and assessments,
casualties, surety bond premiums and insurance premiums.
"Decommissioning Tax Liability" for any month shall be an
amount established by Vermont Yankee and approved by its board of
directors to meet possible income tax obligations, which amount
shall not exceed: the amount to be included in the clause (x)
portion of Total Decommissioning Costs for such month multiplied
by a fraction whose numerator is equal to the combined highest
statutory federal and state marginal income tax rate and whose
denominator is equal to one minus the combined highest statutory
federal and state marginal income tax rate. Vermont Yankee will
use its best efforts to obtain as promptly as possible favorable
tax treatment of the payments for Total Decommissioning Costs
hereunder so that Decommissioning Tax Liability may be minimized.
Without limiting the generality of the foregoing, amounts
expended or to be paid with respect to decommissioning of the
Unit or removal of the Unit from service shall constitute part of
the Decommissioning Expenses if they are, or when paid will be,
either (i) properly chargeable to any account related to
decommissioning of a nuclear generating unit in accordance with
the Uniform System or generally accepted accounting principles as
then in effect, or (ii) properly chargeable to decommissioning of
a nuclear generating unit in accordance with then applicable
regulations of the NRC or the Federal Energy Regulatory
Commission or its successors (FERC) or any other regulatory
agency having jurisdiction."
3. A new Section 7A is hereby inserted therein immediately
following Section 7 thereof as follows:
"7A. Decommissioning Fund.
Vermont Yankee agrees to cause an appropriate
decommissioning fund to be established in accordance with
applicable regulatory requirements. It is anticipated that FERC
may require an independent trust or other separate fund to be
created which will have the necessary powers to hold and invest
all funds collected for the decommissioning of the Unit and to
disburse the same to pay, or to reimburse Vermont Yankee for,
such costs when actually incurred for decommissioning of the Unit
or removal of the Unit from service. If during the term of such
trust or fund federal or state legislation or regulations are
promulgated which so permit or require, or an alternative entity
is created for funding decommissioning of the Unit, such trust
will have the authority, with the concurrence of Vermont Yankee,
to transfer its trust estate to such newly authorized entity for
the purpose of providing for the decommissioning of the Unit or
removal of the Unit from service.
Vermont Yankee agrees to pay to, or cause to be paid to,
said decommissioning fund or trust all funds collected hereunder
for the express purpose of decommissioning the Unit or removing
the Unit from service and further agrees that, after the tax
consequences of decommissioning collections have been resolved,
any funds collected hereunder to meet Decommissioning Tax
Liability which are not used for that purpose will be refunded as
Purchaser."
4. The last five lines of the first paragraph of Section 9
following clause (iii) thereof are hereby amended to read as follows:
"then and in any such case, the Purchaser may cancel the
provisions of this contract, except that in all cases other than
those described in clause (ii) above, the provisions relating to
the payment of Total Decommissioning Costs shall, whether or not
the Unit is operated or operable and notwithstanding any earlier
termination of the service life of the Unit, remain in full force
and effect until December 31, 2002 or the completion of
decommissioning, whichever is earlier. Such cancellation shall
be effected by written notice given by the Purchaser to Vermont
Yankee. In the event of such cancellation, all continuing
obligations of the parties other than the obligations relating to
the payment and application of Total Decommissioning Costs to the
extent excluded from such cancellation by the second preceding
sentence, but including the Purchaser's obligations to continue
payments pursuant to clauses (a), (c), and (d) of the second
paragraph of Section 7 hereof, shall cease forthwith. Any
dispute as to the Purchaser's right to cancel this contract
pursuant to the foregoing provisions shall be referred to
arbitration in accordance with the provisions of Section 12.
5. A new Section 20 is inserted therein as follows:
"20. Amendments
Upon authorization by Vermont Yankee's board of directors of
uniform amendments to all the sponsor power contracts, Vermont
Yankee shall have the right to amend the provisions of Section 7
hereof insofar as they relate to the amounts collectible by
Vermont Yankee pursuant to clause (b) of the second paragraph of
Section 7 hereof or to the timing of such collections by serving
an appropriate statement of such amendment upon the Purchaser and
filing the same with FERC (or such other regulatory agency as may
have jurisdiction in the premises) in accordance with the
provisions of applicable laws and any rules and regulations
thereunder, and the amendment shall thereupon become effective on
the date specified therein, subject to any suspension order duly
issued by such agency. All other amendments to this contract
shall be by mutual agreement, evidenced by a written amendment
signed by the parties hereto."
This Amendment No. 2 shall become effective on April 24, 1983, subject
to any suspension order duly issued by the Federal Energy Regulatory
Commission.
IN WITNESS WHEREOF, the parties have executed this amendment by their
respective officers duly authorized as of the day and year first named
above.
VERMONT YANKEE NUCLEAR POWER CORPORATION
By ______________________________
President
R.D. 5, Ferry Road, Box 169
Brattleboro, Vermont 05301
PURCHASER
By ______________________________
(Officer)