Exhibit 10.8
[Composite Conformed Copy]
CAPITAL FUNDS AGREEMENT, dated as of May 20, 1968, between MAINE YANKEE
ATOMIC POWER COMPANY ("Maine Yankee"), a Maine corporation, and
(The names of the Sponsors appear in the attached Appendix)
(the "Sponsor").
It is agreed as follows:
1. Basic Understandings
Maine Yankee has been organized to provide for the supply of power to
its eleven sponsoring utility companies (including the Sponsor). Late in
1966 and early in 1967, it entered into contracts for the manufacture of the
major components and the services of an architect-engineer for the
construction of a nuclear electric generating unit of the pressurized water
type, designed to have a capability of approximately 800 megawatts electric,
at a site on tidewater in the Town of Wiscasset, Maine (such unit being
herein, together with the site and all related facilities to be owned by
Maine Yankee, referred to as the "Unit"). Construction of the Unit is now
being carried out under contracts with Combustion Engineering, Inc. and
Westinghouse Electric Corporation for certain major systems of equipment and
Stone and Webster Engineering Corporation as Architect-Engineer.
Each of the eleven sponsoring utilities (the "sponsors") has
contemporaneously agreed to purchase a stated percentage of the capacity and
output of the Unit and a like percentage of Maine Yankee's stock (its "stock
percentage"). The names of the sponsors and their respective stock
percentages are as follows:
Stock
Sponsors Percentage
Central Maine Power Company 38.0%
New England Power Company 20.0%
The Connecticut Light and Power Company 8.0%
Bangor Hydro-Electric Company 7.0%
Maine Public Service Company 5.0%
Public Service Company of New Hampshire 5.0%
Cambridge Electric Light Company 4.0%
Montaup Electric Company 4.0%
The Hartford Electric Light Company 4.0%
Western Massachusetts Electric Company 3.0%
Central Vermont Public Service Corporation 2.0%
Maine Yankee and each of its other sponsors are contemporaneously entering
into capital funds agreements which are identical to this agreement except
for the necessary changes in the names of the parties.
Maine Yankee's authorized and outstanding capital as of the date of this
agreement is $10,000,000 consisting of 100,000 shares of common stock, $100
par value, which is owned by Maine Yankee's sponsors in their respective
stock percentages. Maine Yankee's estimated capital requirements with
respect to the Unit (exclusive of fuel) aggregate $145,000,000. It is the
present intention of Maine Yankee to finance not less than 65% of the capital
requirements of the Unit, whether incurred before or after the Unit is placed
in commercial operation, through the issuance and sale of mortgage bonds or
other securities and through borrowings from other than the sponsors, and the
balance through the issuance and sale of additional common stock to its
sponsors or the receipt from its sponsors of loans, advances or capital
contributions or the issuance and sale of preferred stock to other than the
sponsors.
2. Effective Date and Term
This agreement shall become effective upon receipt by the Sponsor of
notice that Maine Yankee has entered into capital funds agreements, as
contemplated by Section 1 above, with each of the other sponsors.
The term of this agreement shall expire December 31, 2003.
3. Construction of the Unit
Maine Yankee will proceed with due diligence with the construction of
the Unit, and will exercise its best efforts to complete and place it in
commercial operation by May 1, 1972 within present cost estimates, and will
keep the Sponsor informed as to the progress of construction, material
modifications in cost estimates, and the date on which it is expected the
Unit will be placed in commercial operation.
4. Stock Purchases and Capital Contributions to Provide the Capital
Requirements of the Unit
From time to time when Maine Yankee requires capital to meet the capital
requirements of the Unit, it may offer shares of its common stock to its
sponsors for subscription, or may request capital contributions from its
sponsors, to raise such capital. Subject to the provisions of Section 7, (i)
whenever Maine Yankee determines to offer any such shares for such purpose,
Maine Yankee agrees to offer to the Sponsor, and the Sponsor agrees to
subscribe for and purchase, for cash at the par value thereof, the Sponsor's
stock percentage of the shares so offered, and (ii) whenever Maine Yankee
requests capital contributions for such purpose, the Sponsor will contribute
in cash its stock percentage of the total capital contribution so requested.
5. Capital Requirements of the Unit Defined
Maine Yankee shall be deemed to have capital requirements of the Unit
within the meaning of Section 4 if it requires capital (including funds to
reimburse Maine Yankee for expenditures made for any of the following
purposes out of the proceeds of short-term borrowings) for any of the
following purposes:
(i) to complete construction of the Unit and place it in commercial
operation at a gross capability of at least 800 megawatts electric;
(ii) to make additions and replacements (other than those chargeable to
maintenance) to the Unit which are required to insure the continued regular
operation of the Unit at a gross capability of at least 800 megawatts
electric or to restore it to regular operation at such gross capability;
(iii) to make any change in or addition to the Unit which must be
made in order to obtain or maintain, or to meet the conditions of any license
or other public authorization, regulation or order which is required for or
applicable to the regular operation of the Unit at a gross capability of at
least 800 megawatts electric;
(iv) to provide materials and supplies, or funds for prepaid items or
cash working capital, required for the regular operation of the Unit at a
gross capability of at least 800 megawatts electric;
(v) to finance the costs of obtaining and maintaining an inventory of
nuclear fuel of a type and amount required for the operation of the Unit.
If Maine Yankee shall at any time or times determine that it would be
more feasible, economic or otherwise desirable for regular operation for the
generation of power and energy for delivery under its Power Contracts with
its sponsors for the Unit to operate at a lower gross capability than 800
megawatts and if it holds or can obtain all licenses and other public
authorizations required for the regular operation of the Unit at such lower
level, then the "capital requirements of the Unit" shall include any
additional capital required for any of the foregoing purposes for operation
of the Unit at any such lower level of capability.
6. Loans and Advances
In lieu of offering shares of its common stock for subscription and
purchase or requesting capital contributions under Section 4, Maine Yankee
may, at its option, request its sponsors to provide required capital by means
of loans or advances. In any case where Maine Yankee determines to request
such loans or advances in lieu of stock purchases, Maine Yankee agrees to
offer to the Sponsor, and the Sponsor, subject to the provisions of Section
7, agrees to provide to Maine Yankee the Sponsor's stock percentage thereof.
However, Maine Yankee shall not be entitled to request such loans or advances
except in circumstances where it would be entitled to require the Sponsor to
make a stock subscription or capital contribution pursuant to Section 4.
The terms of any loans and advances requested by Maine Yankee under the
preceding paragraph, as to interest, maturity date, rights and terms of
prepayment, and otherwise shall be the same for all sponsors. Such terms
shall be as determined by Maine Yankee in its discretion, except that the
terms of each such loan or advance shall provide for quarterly payments of
interest at an annual rate not less than 11/2% in excess of the lowest prime
rate for commercial loans at the time in effect at any bank in Boston,
Massachusetts.
Nothing in this agreement shall be construed as prohibiting Maine Yankee
from requesting and receiving non-interest bearing open account advances from
its sponsors in the nature of interim investment advances to be applied
toward the purchase of stock or capital contributions.
7. Conditions to the Sponsor's Obligations
The Sponsor shall not be obligated to subscribe for and purchase its
stock percentage of any stock issue under Section 4 or to provide its stock
percentage of any capital contribution under Section 4 or of any loan or
advance under Section 6, unless all necessary regulatory approvals shall have
been obtained with respect to both the action to be taken by Maine Yankee and
the action to be taken by the Sponsor in connection with such stock issue,
capital contribution, loan or advance. The parties will use their best
efforts to obtain, or to assist in obtaining, the foregoing regulatory
approvals. Except as expressly provided in this Section 7, no action of, nor
failure to act by, Maine Yankee or any of the several sponsors shall permit
cancellation of, or relieve the Sponsor from any of its obligations under,
this agreement. The failure of any other sponsor to purchase its stock
percentage of any stock issue or to make its stock percentage of any capital
contribution, loan or advance requested by Maine Yankee shall not excuse the
Sponsor from making stock purchases, capital contributions, loans or advances
which do not in the aggregate exceed the Sponsor's stock percentage of the
total stock purchases, capital contributions, loans and advances requested
under Sections 4 or 6 from all sponsors. However, no sponsor shall be
required to make any stock purchase, capital contribution, loan or advance
which is for the purpose of providing funds required by reason of the failure
of another sponsor to purchase its stock percentage of any stock issue or to
make its stock percentage of any capital contribution, loan or advance
requested by Main Yankee.
8. Other Financing
Nothing in this agreement shall be construed as precluding Maine Yankee
from offering shares of its common stock to, or requesting capital
contributions and loans and advances from, its sponsors to finance capital
requirements other than those contemplated by Section 5, or from financing,
in its discretion, its capital requirements (including the capital
requirements contemplated by Section 5), by means other than the sale of its
common stock to the sponsors or capital contributions or loans or advances
from them, but not by the sale of its common stock other than to its
sponsors.
9. Cooperation by Sponsor
The Sponsor agrees that it will cooperate with Maine Yankee in taking
all such action as may be necessary or appropriate to effectuate the purposes
of this agreement.
10. Restrictions on Transfer
The Sponsor acknowledges notice of the restrictions on stock transfers
contained in Section 8.1 of Maine Yankee's by-laws and agrees to be bound by
said provisions with respect to all shares of Maine Yankee's common stock
which it may acquire.
11. Arbitration
In case any dispute shall arise as to the interpretation or performance
of this contract which cannot be settled by mutual agreement and which may be
finally determined by arbitration under the law of the State of Maine then in
effect, such dispute shall be submitted to arbitration, and arbitration of
such dispute shall be a condition precedent to any action at law or suit in
equity that can be brought. The parties shall if possible agree upon a
single arbitrator. In case of failure to agree upon an arbitrator within 15
days after the delivery by either party to the other of a written notice
requesting arbitration, either party may request the American Arbitration
Association to appoint the arbitrator. The arbitrator, after opportunity for
each of the parties to be heard, shall consider and decide the dispute and
notify the parties in writing of his decision. The expenses of the
arbitration shall be borne equally by the parties.
12. Interpretation
The interpretation and performance of this agreement shall be in
accordance with and controlled by the law of the State of Maine.
13. Addresses
Except as the parties may otherwise agree, any notice, request or other
communication from one party to the other, relating to this agreement or the
rights, obligations or performance of the parties hereunder, shall be in
writing and shall be effective upon delivery to the other party. Any such
communication shall be considered as duly delivered when delivered in person
or upon the lapse of 48 hours after mailing by registered or certified mail,
postage prepaid, to the address of the other party shown following the
signature of such other party hereto, or such other address as may be
designated by written notice given as provided in this Section 13.
14. Assignment
This agreement shall be binding upon and shall inure to the benefit of,
and may be performed by, the successors and assigns of the parties, except
that no assignment, pledge or other transfer of this agreement by either
party shall operate to release the assignor, pledgor or transferor from any
of its obligations under this agreement unless consent to the release is
given in writing by the other party (if not theretofore released pursuant to
this Section) and, if the other party has theretofore assigned, pledged or
otherwise transferred its interest in this agreement, by the other party's
assignee, pledgee or transferee, or unless such transfer is incident to a
merger or consolidation with, or transfer of all or substantially all of the
assets of the transferor to, another sponsor which shall, as a part of such
succession, assume all the obligations of the transferor under this
agreement.
15. Corporate Obligations
This agreement is the corporate act and obligation of the parties
hereto, and any claim hereunder against any stockholder (other than the
Sponsor), director or officer of either party, as such, is expressly waived.
16. All Prior Agreements Superseded
This agreement represents the entire agreement between Maine Yankee and
the Sponsor relating to the subject matter hereof, and all previous
agreements, discussions, communications and correspondence with respect to
the subject matter are hereby superseded and are of no further force and
effect.
IN WITNESS WHEREOF, the parties have executed this agreement by their
respective officers thereunto duly authorized as of the date first above
written.
MAINE YANKEE ATOMIC POWER COMPANY
By W. H. Dunham
President
9 Green Street
Augusta, Maine 04330
[Sponsor]
By
(Officer)
Its
(Title)
(Address)
APPENDIX
Separate Capital Funds Agreements were entered into, identical in form
with the foregoing except as to the execution thereof and except that on page
1 the names of the respective Sponsors were inserted.
The Capital Funds Agreements were executed by the respective parties
thereto, as follows:
MAINE YANKEE ATOMIC POWER COMPANY
By W. H. Dunham,
President
9 Green Street
Augusta, Maine 04330
CENTRAL MAINE POWER COMPANY
By S. Giddings
Executive Vice President
9 Green Street
Augusta, Maine
NEW ENGLAND POWER COMPANY
By Robert F. Krause
President
441 Stuart Street
Boston, Massachusetts
THE CONNECTICUT LIGHT AND POWER COMPANY
By Sherman R. Knapp
Chairman
P.O. Box 2010
Hartford, Connecticut 06101
BANGOR HYDRO-ELECTRIC COMPANY
By R. N. Haskell
President
33 State Street
Bangor, Maine 04401
MAINE PUBLIC SERVICE COMPANY
By C. Hazen Stetson
Chairman
209 State Street
Presque Isle, Maine 04769
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
By W. C. Tallman
President
1087 Elm Street
Manchester, New Hampshire 03105
CAMBRIDGE ELECTRIC LIGHT COMPANY
By John F. Rich
President
130 Austin Street
Cambridge, Massachusetts 02139
MONTAUP ELECTRIC COMPANY
By Guido R. Perera
President
P.O. Box 2333
Boston, Massachusetts 02107
THE HARTFORD ELECTRIC LIGHT COMPANY
By C. L. Derrick
Chairman
P.O. Box 2370
Hartford, Connecticut 06101
WESTERN MASSACHUSETTS ELECTRIC COMPANY
By Robert E. Barrett, Jr.
President
174 Brush Hill Avenue
West Springfield, Massachusetts 01089
CENTRAL VERMONT PUBLIC SERVICE CORPORATION
By L. Douglas Meredith
President
77 Grove Street
Rutland, Vermont 05701