UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark one)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2003
-------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
---------- ----------
Commission file number 1-12527
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BAYCORP HOLDINGS, LTD.
(Exact name of registrant as specified in its charter)
------------------------------------------------------
Delaware 02-0488443
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1 New Hampshire Avenue, Suite 125 03801
Portsmouth, New Hampshire
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (603) 766-4990
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.)
Yes No X
--- ---
Class Outstanding at July 31, 2003
- --------------------------------------- ----------------------------
Common Stock, $0.01 Par Value per Share 646,937
BAYCORP HOLDINGS, LTD.
INDEX
PART I - FINANCIAL INFORMATION:
Item 1 - Financial Statements:
Consolidated Statements of Income and Comprehensive Income -
Three and Six Months Ended June 30, 2003 and 2002 3
Consolidated Balance Sheets at June 30, 2003
and December 31, 2002 4
Consolidated Statements of Cash Flows -
Six Months Ended June 30, 2003 and 2002 5
Notes to Financial Statements 6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 12
Item 3 - Quantitative and Qualitative Disclosures
About Market Risk 17
Item 4 - Controls and Procedures 18
PART II - OTHER INFORMATION:
Item 5 - Other Information 18
Item 6 - Exhibits and Reports on Form 8-K 18
Signatures 19
Exhibit Index 20
2
BAYCORP HOLDINGS, LTD.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
(Dollars in Thousands, except shares and per share data)
Three Months Ended June 30, Six Months Ended June 30,
2003 2002 2003 2002
---- ---- ---- ----
Operating Revenues $996 $10,126 $1,987 $25,494
Operating Expenses
Production 0 6,832 0 13,418
Transmission 0 291 0 539
Purchased Power 902 71 2,097 263
Unrealized (Gain) Loss on Firm
Energy Contracts (498) 0 585 0
Administrative & General 905 2,269 1,661 4,253
Depreciation & Amortization 0 939 0 1,880
Decommissioning Cost Accretion 0 1,232 0 2,463
Decommissioning Trust Fund
Income 0 (448) 0 (805)
Taxes other than Income 4 939 132 1,810
-------- --------- --------- ----------
Total Operating Expenses 1,313 12,125 4,475 23,821
Operating Income (Loss) (317) (1,999) (2,488) 1,673
Other (Income) Deductions:
Interest and Dividend Income (32) (145) (434) (275)
Other (Income) Deductions (320) (131) (327) 27
-------- --------- --------- ----------
Total Other Income (352) (276) (761) (248)
Income (Loss) Before Income Taxes 35 (1,723) (1,727) 1,921
Income Taxes 0 0 0 0
-------- --------- --------- ----------
Net Income (Loss) 35 (1,723) (1,727) 1,921
Other Comprehensive Income,
Net of Tax
Unrealized Loss on Securities 0 (205) 0 (701)
-------- ---------- --------- ----------
Comprehensive Income (Loss) $35 ($1,928) ($1,727) $1,220
======== ========== ========== ==========
Weighted Average Shares
Outstanding - Basic 646,917 8,390,226 4,225,628 8,392,390
Weighted Average Shares
Outstanding - Diluted 653,357 8,390,226 4,225,628 8,692,600
Basic Net Income (Loss) Per Share $0.05 ($0.20) ($0.41) $0.23
Diluted Net Income (Loss) Per
Share $0.05 ($0.20) ($0.41) $0.22
(The accompanying notes are an integral part of these consolidated statements.)
3
BAYCORP HOLDINGS, LTD.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Dollars in Thousands)
June 30, December 31,
2003 2002
---- ----
ASSETS
Current Assets:
Cash & Cash Equivalents $7,885 $134,164
Restricted Cash - Escrow 2,500 2,500
Accounts Receivable, net 328 316
Prepayments & Other Assets 3,180 3,427
------- ---------
Total Current Assets 13,893 140,407
Other Assets:
Energy Trading Contracts - at market 1,459 2,184
-------- ---------
TOTAL ASSETS $15,352 $142,591
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable and Accrued Expenses $734 $414
Miscellaneous Current Liabilities 1,990 6,141
--------- ---------
Total Current Liabilities 2,724 6,555
Deferred Gain on Long Term Power Contract 1,929 2,061
Commitments & Contingencies
Stockholders' Equity:
Common stock, $.01 par value,
Authorized - 20,000,000 shares,
Issued and Outstanding -
646,937 and 8,455,269, respectively 6 84
Additional Paid-in Capital (20,579) 100,893
Accumulated Earnings 31,272 32,998
--------- ---------
Total Stockholders' Equity 10,699 133,975
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $15,352 $142,591
========== =========
(The accompanying notes are an integral part of these consolidated statements.)
4
BAYCORP HOLDINGS, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Dollars in Thousands)
Six Months Ended June 30,
2003 2002
---- ----
Net cash flow from operating activities:
Net (loss) income ($1,727) $1,921
Adjustments to reconcile net earnings to net
cash (used in) provided by operating activities:
Depreciation and amortization 0 1,880
Amortization of nuclear fuel 0 2,070
Unrealized (gain) loss on the mark-to-market of firm
energy trading contracts 716 0
Deferred gain on power contract (131) 0
Non-cash compensation expense 296 563
Decommissioning trust accretion 0 2,463
Decommissioning trust interest and other charges 0 (806)
(Increase) decrease in accounts receivable (12) 1,645
Increase in materials & supplies 0 4
(Increase) decrease in prepaids and other assets 256 (166)
Increase (decrease) in accounts payable and accrued
expenses 452 (1,368)
Increase (decrease) in misc. and other liabilities (4,283) (3,181)
---------- --------
Net cash (used in) provided by operating activities ( 4,433) 5,025
Net cash flows used in investing activities:
Capital additions 0 (794)
Nuclear fuel additions 0 (98)
Payments to decommissioning fund 0 (697)
Decrease in restricted cash 0 1,546
Purchases of short term investments 0 (16,625)
Sales of short term investments 0 1,857
--------- --------
Net cash used in investing activities 0 (14,811)
Net cash used in financing activities:
Stock option exercise 1,776 153
Reacquired capital stock and options (123,622) (376)
--------- --------
Net cash used in financing activities (121,846) (223)
Net decrease in cash and cash equivalents (126,279) (10,009)
Cash and cash equivalents, beginning of period 134,164 15,278
--------- --------
Cash and cash equivalents, end of period $7,885 $5,269
Supplemental Disclosure of Non-cash Financing Activities: ========= ========
Stock option exercise in exchange for promissory notes $0 $737
Cash paid during the period for income taxes $2,241 $705
(The accompanying notes are an integral part of these consolidated statements.)
5
BAYCORP HOLDINGS, LTD.
NOTES TO FINANCIAL STATEMENTS
NOTE A - THE COMPANY
BayCorp Holdings, Ltd. ("BayCorp" or the "Company") is a
holding company incorporated in Delaware in 1996. Until November
1, 2002, BayCorp had two principal operating subsidiaries that
generated and marketed wholesale electricity, Great Bay Power
Corporation ("Great Bay") and Little Bay Power Corporation
("Little Bay"). Their principal asset was a combined 15% joint
ownership interest in the Seabrook Nuclear Power Project in
Seabrook, New Hampshire, (the "Seabrook Project" or "Seabrook")
until November 1, 2002, when BayCorp sold Great Bay's and Little
Bay's interest in Seabrook. See "Sale of Seabrook Ownership"
below. Those ownership interests entitled Great Bay and Little
Bay to approximately 174 megawatts ("MWs") of the Seabrook
Project's power output. Great Bay and Little Bay were exempt
wholesale generators ("EWGs") under the Public Utility Holding
Company Act of 1935 ("PUHCA"). Unlike regulated public
utilities, Great Bay and Little Bay had no franchise area or
captive customers. The companies sold their power in the
competitive wholesale power markets. Great Bay and Little Bay
were each wholly-owned by BayCorp. In December 2002, BayCorp
formally dissolved Great Bay and Little Bay.
In October 2002, BayCorp created two new subsidiaries, Great
Bay Power Marketing, Inc. ("GBPM") and BayCorp Ventures, LLC
("BayCorp Ventures"). BayCorp formed GBPM to hold the purchased
power contract that Great Bay had with Unitil Power Corporation
("Unitil") and to purchase the power supply to satisfy the Unitil
contract. See "Note C - Commitments and Contingencies -
Purchased Power Agreements." Effective January 1, 2003, GBPM
assumed the Unitil contract and holds the Company's letter of
credit established to secure GBPM's obligations under the Unitil
contract. The Company formed BayCorp Ventures to serve as a
vehicle through which the Company can make investments following
the Seabrook sale and the expiration of the Company's tender
offer. See "Note A - Tender Offer."
BayCorp also owns shares representing approximately 46.4% of
the voting power of all outstanding common and preferred shares
of HoustonStreet Exchange, Inc. ("HoustonStreet").
HoustonStreet, incorporated in Delaware in 1999, is an equity
investment of BayCorp. HoustonStreet developed and operates
HoustonStreet.com, an Internet-based independent crude oil and
refined products trading exchange in the United States.
Sale of Seabrook Ownership
In October 2000, the Company announced that it reached an
agreement with Northeast Utilities ("NU") under which the
Company's generating subsidiaries, Great Bay and Little Bay,
would include their aggregate 15% ownership share of the Seabrook
Project in the auction of NU's subsidiaries' shares of the
Seabrook Project. As a result of the auction, which was
conducted in 2001 and 2002, FPL Energy Seabrook, LLC, a
subsidiary of FPL Group, Inc., ("FPL Energy Seabrook") agreed to
purchase 88.2% of the 1,161 MW Unit 1 and 88.2% of the partially
constructed Unit 2, for $836.6 million subject to certain
adjustments, with payment deliverable fully in cash at closing.
The purchase price included the projected fuel and non-fuel
inventories at closing and Unit 2 components. Great Bay, Little
Bay and the other sellers were responsible for making their then
required decommissioning fund top off payments on or before the
date of sale closing and to transfer their respective
decommissioning trust funds to FPL Energy Seabrook. FPL Energy
Seabrook assumed nearly all of the Company's Seabrook liabilities
including the decommissioning liability for the acquired portion
of Seabrook including the requirement that it provide an
appropriate future funding
6
BAYCORP HOLDINGS, LTD.
assurance subject to the approval of the New Hampshire
Nuclear Decommissioning Financing Committee. FPL
Group, Inc. provided a parent company guaranty that it
will fully fund its ownership share of the projected
cost of decommissioning in a manner consistent with New
Hampshire statutory requirements. FPL Energy Seabrook
also agreed to comply with all employee protections
required by New Hampshire law and the Settlement
Agreement. On November 1, 2002, the Company closed the
sale of its interests in Seabrook and received
approximately $113 million for its interests in the
Seabrook Project (the "Seabrook Closing"). The Company
funded certain escrows for potential closing
adjustments and paid other costs of approximately
$4.3 million. The escrow amounts are included in
prepayments and the potential closing adjustments are
included in miscellaneous current liabilities.
The following unaudited pro forma income statement
assumes the disposition of the Seabrook investment
occurred on January 1, 2002. The unaudited pro forma
financial information is presented for comparative
purposes only and is not intended to be indicative of
actual results of continuing operations that would have
been achieved had the sale been consummated as of
January 1, 2002, nor do they purport to indicate
results which may be attained in the future.
Three Months Ended Six Months Ended
June 30, 2002 June 30, 2002
------------------------------ -------------------------------
Seabrook Seabrook
Investment Investment
(1) (1)
Proforma Proforma
BayCorp Adjust- BayCorp Adjust-
Historical ments Pro-Forma Historical ments Pro-Forma
--------- ---------- -------- --------- ---------- --------
(dollars in thousands)
OPERATING REVENUES
Sales $ 10,126 ($9,338) $ 788 25,494 ($ 23,535) $ 1,959
OPERATING EXPENSES
Production 6,832 (6,832) 0 13,418 (13,418) 0
Transmission 291 (291) 0 539 (539) 0
Purchased Power 71 561 632 263 1,000 1,263
Administrative & General 2,269 (802) 1,467 4,253 (1,837) 2,416
Decommissioning Cost
Accretion 1,232 (1,232) 0 2,463 (2,463) 0
Decommissioning Trust Fund
Income (448) 448 0 (805) 805 0
Depreciation and Amortization 939 (939) 0 1,880 (1,880) 0
Taxes other than Income 939 (920) 19 1,810 (1,764) 46
---------- --------- -------- --------- ---------- ----------
Total Operating Expenses 12,125 (10,007) 2,118 23,821 (20,096) 3,725
OPERATING INCOME (LOSS) (1,999) 669 (1,330) 1,673 (3,439) (1,766)
OTHER (INCOME) DEDUCTIONS
Interest and Investment
Income (145) 0 (145) (275) 0 (275)
Other Expense (131) 0 (131) 27 0 27
---------- -------- --------- ---------- --------- ----------
Total Other (Income)
Deductions (276) 0 (276) (248) 0 (248)
INCOME (LOSS) BEFORE INCOME
TAXES (1,723) 669 (1,054) 1,921 (3,439) (1,518)
Income Tax Expense 0 0 0 0 0 0
---------- --------- -------- --------- ---------- ----------
NET INCOME (LOSS) ($1,723) $669 ($1,054) $1,921 ($3,439) ($1,518)
========== ========= ========= ========= =========== ==========
Weighted Average Shares
Outstanding -Basic 8,390,226 8,390,226 8,392,390 8,392,390
Weighted Average Shares
Outstanding - Diluted 8,390,226 8,390,226 8,692,600 8,392,390
Basic Net Income (Loss) per
share ($0.20) ($0.13) $0.23 ($0.18)
Diluted Net Income (Loss) per
share ($0.20) ($0.13) $0.22 ($0.18)
(1) Pro forma income statement amounts represent sales
under the Unitil contract along with related purchased
power. The pro forma Admin & General expenses include
the costs incurred by BayCorp to manage its investment
in Seabrook. Pro forma results do not consider the cost
reductions which would be required if the Company no
longer held its Seabrook investment.
7
BAYCORP HOLDINGS, LTD.
Tender Offer
On January 31, 2003, BayCorp commenced an issuer
tender offer to purchase up to 8,500,000 shares of its
Common Stock at a price of $14.85 per share (the
"Tender Offer" or "Offer"). The Company disclosed in
the Offer to Purchase mailed to shareholders that the
Board may decide to reduce the number of shares
purchased in the Offer to preserve the Company's
ability to use its approximately $90 million in net
operating loss ("NOL") carryforwards. The Offer was
scheduled to expire on March 3, 2003.
On March 4, 2003, in view of the response to the
Offer and the significant proration that would have
been necessary to preserve the Company's approximately
$90 million in NOL carryforwards, the Board determined
and announced that it would not exercise its discretion
to prorate the shares tendered in the Offer to preserve
the Company's ability to use the NOL carryforwards
without limitation. The Company extended the
expiration date of the Tender Offer to March 18, 2003
to provide shareholders additional time to tender
shares that had not been tendered or to withdraw shares
that had been tendered. On March 18, 2003, 9,207,508
shares had been properly tendered and not withdrawn
(including options surrendered for repurchase and
cancellation.) The Company exercised its discretion to
purchase up to an additional 2% of outstanding shares,
purchasing a total of 8,673,887 shares (and surrendered
options) at a purchase price of $14.85, representing
approximately 94.3% of the shares (and options)
tendered, excluding odd lots, which were purchased
without proration. Payment for all such shares and
options was completed by March 24, 2003. As a result,
as of June 30, 2003, the Company had 646,937 shares
outstanding and cash and cash equivalents and
restricted cash of approximately $10,385,400.
Enron Claim
On January 4, 2002, BayCorp reported that Great Bay
received notice on December 21, 2001 from Enron Power
Marketing, Inc. ("Enron") that Enron was terminating
its contracts with Great Bay. Enron owes Great Bay
$1,075,200 for power delivered prior to Enron's Chapter
11 bankruptcy filing on December 2, 2001. During the
fourth quarter of 2001, BayCorp recorded an expense of
$1,100,000 to establish a reserve for doubtful accounts
due to the uncertainty of collecting remaining amounts
owed by Enron to Great Bay for power delivered prior to
Enron's Chapter 11 bankruptcy filing. Enron has filed
a plan of reorganization on July 11, 2003, which is
subject to approval of creditors and the bankruptcy
court. The amount of any recovery by the Company on
account of its claim against Enron is uncertain.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The unaudited financial statements included herein
have been prepared on behalf of the Company pursuant to
the rules and regulations of the Securities and
Exchange Commission ("SEC") and include, in the opinion
of management, all adjustments, consisting of normal
recurring adjustments, necessary for a fair
presentation of interim period results. Certain
information and footnote disclosures normally included
in financial statements prepared in accordance with
generally accepted accounting principles have been
omitted or condensed pursuant to such rules and
regulations. The Company believes, however, its
disclosures herein, when read in conjunction with the
Company's audited financial statements for the year
8
BAYCORP HOLDINGS, LTD.
ended December 31, 2002 as filed in Form 10-K (as
amended by Form 10-K/A filed June 9, 2003), are
adequate to make the information presented not
misleading. The Company's significant accounting
policies are described in Note 1 of Notes to
Consolidated Financial Statements included in the
Company's 10-K (as amended by Form 10-K/A filed June 9,
2003). The results for the interim periods are not
necessarily indicative of the results to be expected
for the full fiscal year.
Previously, Great Bay utilized unit contingent and
firm forward power sales contracts to maximize the
value of its 174 MW power supply from the Seabrook
Project. The Company follows the provisions of SFAS
133 Accounting for Derivative Activities and Hedging
Activities. The Company recorded the related firm
forward power sale contracts at fair value based on the
estimated contract replacement value at each balance
sheet date. The Company had one firm forward power
sales contract, its amended power sales agreement with
Unitil, as of June 30, 2003, which required mark-to-
market accounting treatment. As of June 30, 2003, the
Company has an unrealized loss on the mark-to-market of
this firm forward power sales contract recorded in its
financial statements. The net change in unrealized
loss on firm forward power sales contracts included in
the accompanying consolidated statements of income for
the quarter ended June 30, 2003 was a net gain of
approximately $432,100. The mark to market value of
the contract at June 30, 2003 was approximately $1.5
million. The Company had no firm forward power sales
contracts as of June 30, 2002 that required mark-to-
market accounting treatment.
NOTE C - COMMITMENTS AND CONTINGENCIES
Purchased Power Agreements
In anticipation of the Seabrook sale, the Unitil
Purchased Power Agreement ("PPA") was amended as of
November 1, 2002. The amendment primarily modified the
existing PPA to reduce the amount of power delivered to
9.06 megawatts and the price that Unitil pays for power
to $50.34 per megawatt hour, and provide that Great Bay
would supply the power regardless of whether Seabrook
is providing the power. The amendment also provided
alternative security for Unitil's benefit, to replace
and discharge the Third Mortgage that secured Great
Bay's performance of the PPA. In connection with the
amended PPA, the Company was required to deposit $2.5
million into a restricted account for the benefit of
Unitil should Great Bay default. The amount is
reflected as restricted cash in the accompanying
balance sheet. The amendment received FERC approval.
Great Bay assigned the Unitil PPA to GBPM.
This contract meets the definition of an energy
trading contract under EITF 98-10 and 00-17. In
accordance with FASB's Emerging Issues Task Force
interpretation 02-03 the inception gain (initial value
of $2.1 million) on the contract has been deferred and
will be recognized over the life of the contract. As
of December 31, 2002 the fair value of the contract was
$2.2 million. The deferred gain on the contract was
$2.1 million. The Company recorded $131,500 of this
deferred gain in the first six months of 2003. These
amounts are reflected in the Company's balance sheet.
On March 17, 2003, Unitil announced the approval of
a contract with Mirant Americas Energy Marketing, LP
("Mirant"), which provides for the sale of Unitil's
existing power supply entitlements, including the PPA
with GBPM, effective on May 1, 2003. GBPM's PPA with
Unitil is not being assigned to Mirant. Rather, Unitil
has appointed Mirant as their agent for purposes of
administering the PPA with GBPM and Mirant is
purchasing Unitil's entitlement under the PPA.
NOTE D - INVESTMENT IN UNCONSOLIDATED AFFILIATES
9
BAYCORP HOLDINGS, LTD.
In January 2003, the FASB issued Interpretation No.
46, Consolidation of Variable Interest Entities - An
Interpretation of ARB No. 51. The interpretation
requires that a company consolidate the financial
statements of an entity that cannot finance its
activities without outside financial support, and for
which that company provides the majority of support.
The Company has deemed that its subsidiary,
HoustonStreet Exchange, Inc., is a variable interest
entity. Although the Company has significant variable
interest in HoustonStreet, the Company has determined
that it is not the primary beneficiary as of June 30,
2003. Therefore, the Company has not consolidated
HoustonStreet. The Company's maximum exposure to loss
in HoustonStreet was approximately $7.7 million at June
30, 2003. Losses totaling this amount were recognized
in the Company's financial statements in prior periods.
As of June 30, 2003, the Company owned shares
representing approximately 46.4% of the voting power of
all outstanding common and preferred shares of
HoustonStreet. The Company also currently holds
approximately $10.3 million in HoustonStreet senior
secured promissory notes, of the approximate $12.9
million in senior secured promissory notes currently
outstanding at HoustonStreet. Summarized financial
information for the Company's investment in
HoustonStreet, as accounted for by the equity method,
is as follows:
Year ended Year ended
Six Months ended December 31, December 31,
HoustonStreet: June 30, 2003 2002 2001
------------- --------------- ------------- ------------
Total Assets $566,362 $585,238 $1,256,400
Total Liabilities 13,121,862 12,558,312 14,784,100
Revenues 467,370 1,689,906 1,899,498
Net Income (Loss) (582,421) 1,383,376 (14,936,899)
Company's Proportional Equity
in Net Income (Loss) $(270,243) $641,886 $(6,856,037)
Income (Loss) Reflected in
BayCorp Financials $0 $0 $0
As of June 30, 2003, the Company had no investments
or receivables from HoustonStreet recognized on the
accompanying balance sheet.
NOTE E - EQUITY
On January 31, 2003 the Company announced an issuer
tender offer to purchase up to 8,500,000 shares of its
common stock. Under the terms of the offer, BayCorp
shareholders could tender to BayCorp all or a portion
of the shares that they owned for a cash purchase price
of $14.85 per share. The offer was expected to close
on March 3, 2003. Due to the overwhelming response to
the tender offer and the significant proration that
would have been required to preserve the Company's NOL
carryforwards, the Board of Directors decided that it
would not exercise its discretion to effect a proration
for that purpose and on March 4, 2003, extended the
offer. The extension allowed shareholders additional
time to either tender shares that had not been tendered
or withdraw shares already tendered. BayCorp announced
the final result of the tender offer on March 24, 2003.
BayCorp exercised its right to purchase up to an
additional 2% of its outstanding shares, and accepted
8,673,887 shares of common stock including options
surrendered by directors, officers and employees for
repurchase, in the tender. Funds were distributed to
tendering shareholders and shares not accepted in the
tender were returned to shareholders beginning on March
24,
10
BAYCORP HOLDINGS, LTD.
2003. The Company distributed approximately
$123,622,000. As of June 30, 2003 there were 646,937
shares outstanding and options to purchase 211,713
shares, 110,047 of which were then exercisable.
BayCorp has never paid cash dividends on its common
stock. Any future dividends depend on future earnings,
BayCorp's financial condition and other factors.
NOTE F - STOCK OPTIONS
The Company accounted for its stock option plans
under Accounting Principles Board Opinion No. 25, and
as such no compensation cost was recognized on options
that were granted prior to 2003 at fair market value
and that had not been modified. On August 14, 2002 the
Company announced that it would begin to account
for all employee awards granted, modified, or settled
after January 1, 2003 in accordance with SFAS No. 123,
"Accounting for Stock Based Compensation" on a
prospective basis. Awards under the company's plans
vest over periods ranging from one to three years.
Therefore, the cost related to stock-based employee
compensation included in the determination of net
income for 2002 and 2003 differs from that which would
have been recognized if the fair value based method had
been applied to all awards since the original effective
date of Statement 123. The following table illustrates
the affect on net income and earnings per share if the
fair value based method had been applied to all
outstanding and unvested awards in each period.
6/30/03 6/30/02
------- -------
Net Income (Loss): As Reported $(1,727) $1,921
Stock compensation expense included in net
income 296 563
Stock compensation expenses determined using
fair value method for all awards 237 708
--------- -------
Pro Forma....................................... $ (1,668) $ 1,776
Earnings (Loss) Per Share (Basic): as reported....... $ (0.41) $ 0.23
Pro Forma....................................... $ (0.40) $ 0.21
Earnings (Loss) Per Share (Diluted): as reported..... $ (0.41) $ 0.22
Pro Forma....................................... $ (0.40) $ 0.20
In October 2001, the Company issued 240,000 non-
qualified options pursuant to the 2001 Non-Statutory
Stock Option Plan. These options have an exercise
price of $9.05 and vested upon the closing of the sale
of the Seabrook Project. The Company accounts for
these options under FASB Interpretation No. 44,
Accounting for Certain Transactions involving Stock
Compensation ("FIN 44"). FIN 44 requires variable
accounting when either direct or indirect reductions of
the exercise price occurs. In accordance with APB 25
and FIN 44, the Company recorded compensation expense
related to contingent and repriced options of $77,000
and $240,000, respectively, for the six months ended
June 30, 2003 and 2002. In April 2003, the Company
issued 132,000 options pursuant to the 1996 Stock
Option Plan and the 2001 Non-Statutory Stock Option
Plan. These options have an exercise price of $14.45.
The Company accounts for these options using the fair
value method and recorded compensation of $219,000 in
the second quarter of 2003 for these options.
NOTE G - NEW ACCOUNTING PRONOUNCEMENTS
None applicable to the Company.
11
BAYCORP HOLDINGS, LTD.
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Overview
BayCorp derived substantially all of its revenue
through its energy sales activities by GBPM in the
first six months of 2003 and Great Bay and Little Bay
in the first six months of 2002. BayCorp formed GBPM
to hold the purchased power contract that Great Bay had
with Unitil and to purchase the power supply to satisfy
the Unitil contract. Great Bay and Little Bay were
electric generating companies whose principal asset was
a combined 15% joint ownership interest in the Seabrook
Project. Great Bay and Little Bay were dissolved in
December 2002.
The following discussion focuses solely on operating
revenues and operating expenses and are presented in a
substantially consistent manner for all of the periods
presented. In the first six months of 2003, all
operating revenues were derived from the sale of power
pursuant to the purchased power contract with Unitil.
Expenses for the first six months of 2003 primarily
consisted of the cost of purchased power to satisfy
this contract and general and administrative costs. In
the first six months of 2002, the Company's revenues
were primarily derived from the sale of power generated
from its 15% joint ownership interest in the Seabrook
Project. Expenses in that period included Seabrook
operating costs, purchased power costs and Seabrook
general and administrative costs.
Results of Operations: Second Quarter of 2003 Compared
to the Second Quarter of 2002
Operating Revenues
BayCorp's operating revenues decreased by
approximately $9,130,000 to $996,000 in the second
quarter of 2003 as compared to $10,126,000 in the
second quarter of 2002. The decrease in operating
revenues was primarily attributable to the decrease in
the amount of power sold as a result of the Company's
sale of its ownership interests in Seabrook. During
the three months ended June 30, 2003, GBPM's average
selling price increased 26.6%, to 5.04 cents per kWh as
compared to an average selling price of 3.98 cents per
kWh for Great Bay in the same period in 2002.
Expenses
There were no Seabrook related operating expenses in
the second quarter of 2003. Seabrook production and
transmission expenses were $7,123,000 in the second
quarter of 2002. Purchased power costs increased
approximately $831,000 from $71,000 in the second
quarter of 2002 to $902,000 in the second quarter of
2003. Since the sale of Seabrook, the Company has had
to purchase power to satisfy its firm power agreement
with Unitil. Administrative and general expenses were
$905,000 in the second quarter of 2003 as compared to
approximately $2,269,000 in the second quarter of 2002.
Administrative and general expenses for the second
quarter of 2002 included approximately $831,000 of
Seabrook expenses. There were no Seabrook
administrative and general expenses in the second
quarter of 2003. There were no Seabrook-related costs
for depreciation, decommissioning cost accretion or
decommissioning trust fund income in the second quarter
of 2003. Charges of $939,000 and $1,232,000 and income
of $448,000, respectively, were recorded for these
items in the second quarter of 2002. Taxes other than
income for the second quarter of 2003 were
approximately $4,000 and were primarily payroll-related
taxes. Taxes other
12
BAYCORP HOLDINGS, LTD.
than income for the second quarter of 2002 were
$939,000 and primarily consisted of local and state
taxes associated with the Company's ownership in
Seabrook.
In the second quarter of 2003, GBPM recorded a net
unrealized gain on its firm forward energy trading
contract of $498,000. Sales for the second quarter of
2002 were made on a unit contingent basis as opposed to
firm sales and, as such, there was no mark-to-market
accounting for firm contracts in the second quarter of
2002.
Interest income decreased approximately $113,000
from $145,000 in the second quarter of 2002 to $32,000
in the second quarter of 2003 primarily due to lower
average cash balances in the second quarter of 2003 as
compared to the second quarter of 2002. Other income
increased $189,000 from $131,000 in the second quarter
of 2002 to $320,000 in the second quarter of 2003.
This increase was primarily attributable to the 2003
annual distribution made to Nuclear Electric Insurance
Limited ("NEIL") members representing BayCorp's share
of distributions under mutual insurance policies
associated with the Seabrook plant.
Net Income
As a result of the above factors, during the second
quarter of 2003, the Company recorded net income of
$35,000, or approximately $0.05 per share, as compared
to a net loss of approximately $1,723,000, or
approximately $0.20 per share, during the second
quarter of 2002.
Results of Operations: First Six Months of 2003
Compared to the First Six Months of 2002
Operating Revenues
BayCorp's operating revenues decreased by
approximately $23,507,000 to $1,987,000 in the first
six months of 2003 as compared to $25,494,000 in the
first six months of 2002. The decrease in operating
revenues was primarily attributable to the decrease in
the amount of power sold as a result of the Company's
sale of its ownership interest in Seabrook. During the
six months ended June 30, 2003, GBPM's average selling
price increased 25.1%, to 5.04 cents per kWh as
compared to an average selling price of 4.03 cents per
kWh for Great Bay in the same period in 2002.
Expenses
There were no Seabrook-related operating expenses in
the first six months of 2003. Seabrook production and
transmission expenses were $13,957,000 in the first six
months of 2002. Purchased power costs increased
approximately $1,834,000, from $263,000 in the first
six months of 2002 to $2,097,000 in the first six
months of 2003 because, since the sale of Seabrook, the
Company has had to purchase power to satisfy its firm
power agreement with Unitil. Administrative and
general expenses were $1,661,000 in the first six
months of 2003 as compared to approximately $4,253,000
in the first six months of 2002. Administrative and
general expenses for the first six months of 2002
included approximately $1,837,000 of Seabrook expenses.
There were no Seabrook administrative and general
expenses in the first six months of 2003. There were
no Seabrook-related costs for depreciation,
decommissioning cost accretion or decommissioning trust
fund income in the first six months of 2003. Charges
of $1,880,000 and $2,463,000 and income of $805,000,
respectively, were recorded for these items in the
first six months of 2002. Taxes other than income for
the first six months of 2003 were approximately
$132,000 and were primarily payroll-related
13
BAYCORP HOLDINGS, LTD.
taxes. Taxes other than income for the first six
months of 2002 were $1,810,000 and primarily reflected
local and state taxes associated with the Company's
ownership in Seabrook.
In the first six months of 2003, GBPM recorded a net
unrealized loss on its firm forward energy trading
contract of $585,000. Sales for the first six months
of 2002 were made on a unit contingent basis as opposed
to firm sales and, as such, there was no mark-to-market
accounting for firm contracts in the first quarter of
2002.
Interest income increased approximately $159,000
from $275,000 in the first six months of 2002 to
$434,000 in the first six months of 2003 primarily due
to higher average cash balances in the first six months
of 2003 as compared to the first six months of 2002.
The Company recorded other income of approximately
$327,000 in the first six months of 2003 as compared to
other deductions of approximately $27,000 in the first
six months of 2002. This increase in other income was
primarily attributable to the 2003 annual distribution
made to NEIL members representing BayCorp's share of
distributions under mutual insurance policies
associated with the Seabrook plant.
Net Income
As a result of the above factors, during the first
six months of 2003, the Company recorded a net loss of
$1,727,000, or approximately $0.41 per share, as
compared to net income of approximately $1,921,000, or
approximately $0.23 per share, during the first six
months of 2002.
Liquidity and Capital Resources
As of June 30, 2003, BayCorp had approximately
$10,385,000 in cash and cash equivalents and restricted
cash. BayCorp's cash generation for the six months
ended June 30, 2003 was not sufficient to cover the
cash requirements of the Company during this period.
The Company believes that its current cash, together
with the anticipated proceeds from the sale of
electricity by GBPM, will be sufficient to enable the
Company to meet the currently anticipated cash
requirements of its current operations. However if the
prices at which GBPM must purchase its power supply
increases significantly from current levels, BayCorp or
GBPM could be required to raise additional capital,
either through a debt financing or an equity financing,
to meet ongoing cash requirements. There can be no
assurance that BayCorp or GBPM will be able to raise
additional capital on acceptable terms or at all.
BayCorp's cash and cash equivalents decreased
approximately $126,279,000 during the first six months
of 2003 primarily due to the Company's issuer tender
offer. The final result of the Tender Offer was
announced on March 24, 2003. BayCorp exercised its
right to purchase up to an additional 2% of its
outstanding shares, and accepted 8,673,887 shares of
common stock, including options surrendered by
directors, officers and employees for repurchase, in
the tender. The Company distributed approximately
$123,622,000 to tendering shareholders and option
holders. In addition, in the first quarter of 2003,
the Company received cash of approximately $1,776,000
from stock option exercise transactions.
The Company had a net loss of approximately
$1,727,000 in the first six months of 2003. In the
first six months of 2003 there was a non-cash charge to
earnings of approximately $296,000 for compensation
expense related to the accounting for stock options.
There was a non-cash charge for loss on the mark-to-
market of the Unitil PPA of approximately $716,000 and
a non-cash recognition of deferred gain on the Unitil
PPA of approximately $131,000. A decrease of
approximately $256,000 in prepaids and other assets
14
BAYCORP HOLDINGS, LTD.
was primarily attributable to the settlement of post
Seabrook closing adjustments, and were offset by
corresponding decreases in miscellaneous current
liabilities. In addition, current liabilities
decreased approximately $2,241,000 when installment
payments were made for federal and state income taxes.
The increase in accounts payable and accrued expenses
of approximately $452,000 in the first six months of
2003 was primarily attributable to purchased power
costs.
The Company is presently evaluating its alternatives
regarding the future direction of the business
following the sale of Seabrook and the completion of
the Company's issuer tender offer. Among the Company's
available alternatives are to acquire energy related
assets, make other energy-related investments,
including the further development of HoustonStreet, or
liquidate. If the Company sought to invest in
significant energy-related assets or other investments,
the Company's cash remaining following the tender offer
is likely to be insufficient. In such case, the
Company could seek to raise additional funds through
debt or equity financing. There can be no assurance
that the Company would be successful in obtaining
additional financing. If the Company is not successful
in obtaining additional financing, the Company would
not be able to pursue its desired investment
alternatives. In such case, the Company would consider
all of the options then available, including
liquidation. If the Company decides to liquidate, cash
would be reserved to pay for the expected expenses of
liquidation and other liabilities of the Company.
The Company reduced the number of employees from
eleven as of December 31, 2001 to nine as of December
31, 2002 and then to seven as of June 30, 2003. As a
cost savings measure, the Company relocated in March
2003 to smaller office space in Portsmouth, New
Hampshire and reduced the salaries of Mr. Getman and
Mr. Callendrello.
Critical Accounting Policies
Preparation of the Company's financial statements in
accordance with generally accepted accounting
principles requires management to make estimates and
assumptions that affect the reported amounts of assets
and liabilities, the disclosures of contingent assets
and liabilities, and revenues and expenses. Note 1 to
the Consolidated Financial Statements in the Company's
Form 10-K (as amended by Form 10-K/A filed June 9,
2003) is a summary of the significant accounting
policies used in the preparation of the Company's
financial statements. The following is a discussion of
certain of the Company's critical accounting policies.
Stock Options
The Company accounted for its stock option plans
under APB No. 25 prior to 2003 and as such no
compensation cost had been recognized for options
granted at fair market value that had not been
modified. In prior years, the Company repriced certain
options, accelerated the vesting of others, made
limited recourse loans for certain individuals to
exercise options and issued contingent options. In
accordance with APB 25 and FIN 44, the Company recorded
compensation expense related to these options.
Compensation expense for these options was $77,000 and
$563,000 for the six months ended June 30, 2003 and
2002, respectively. On August 14, 2002 the Company
announced that it would expense the fair value of all
stock options granted beginning January 1, 2003 in
accordance with SFAS No. 123, "Accounting for Stock
Based Compensation." The Company granted 132,000 stock
options to directors, officers and employees in the
second quarter of 2003. The Company recorded
compensation expense of $219,000 for these options.
Principles of Consolidation
15
BAYCORP HOLDINGS, LTD.
BayCorp's Consolidated Financial Statements include
the accounts of the Company and all its subsidiaries.
The Company had a 15% joint ownership interest in
Seabrook, a 1,150 megawatt nuclear generating unit. The
Company recorded in its financial statements its
proportional share of Seabrook's assets, liabilities
and expenses. The Company consolidates all majority-
owned and controlled subsidiaries and applies the
equity method of accounting for investments between 20%
and 50%. All significant intercompany transactions
have been eliminated. All sales of subsidiary stock
are accounted for as capital transactions in the
consolidated financial statements.
In January 2003, FASB issued Interpretation No. 46,
Consolidation of Variable Interest Entities - An
Interpretation of ARB No. 51. The interpretation
requires that a company consolidate the financial
statements of an entity that cannot finance its
activities without outside financial support, and for
which that company provides the majority of support.
The Company has deemed that HoustonStreet is a variable
interest entity. Although the Company has a
significant variable interest in HoustonStreet, the
Company has determined that it is not the primary
beneficiary of HoustonStreet's expected losses as of
June 30, 2003. Therefore, the Company has not
consolidated HoustonStreet.
Energy Marketing
The Company utilized unit contingent and firm
forward sales contracts in the first six months of 2002
to maximize the value of its 174 MW power supply from
the Seabrook Project. The Company currently utilizes
forward and spot market purchases to maximize the value
of its Unitil agreement. The Company had not entered
into any forward firm energy contracts as of June 30,
2002. The forward purchase contracts and Unitil
agreement are recorded at fair value. The initial fair
value gain of the Unitil agreement has been deferred
and is being recognized over the life of the agreement.
Forward Looking Statements and Certain Factors That May
Affect Future Results
This Quarterly Report contains forward-looking
statements. For this purpose, any statements contained
in this report that are not statements of historical
fact, statements about the Company's future business
direction, may be deemed to be forward-looking
statements. Without limiting the foregoing, the words
"believes," "anticipates," "plans," "expects,"
"intends" and similar expressions are intended to
identify forward-looking statements. There are a
number of important factors that could cause the
results of BayCorp and/or its subsidiaries to differ
materially from those indicated by such forward-looking
statements. These factors include, without limitation,
those set forth below and elsewhere in this report.
History of Losses. BayCorp reported operating
income for 2001 and 2002. Prior to 2001, BayCorp had
never reported an operating profit for any year since
its incorporation.
Liquidity Need. As of June 30, 2003, BayCorp had
approximately $10.4 million in cash and cash
equivalents and restricted cash. The Company believes
that such cash, together with the anticipated proceeds
from the sale of electricity by GBPM, will be
sufficient to enable the Company and its wholly owned
subsidiaries to meet the currently anticipated cash
requirements of the current operation in 2003. The
direction of the Company's business and circumstances,
foreseen or unforeseen, may cause cash requirements to
be materially higher than anticipated and the Company
or its wholly-owned subsidiaries may be required to
raise additional capital, either through a debt
financing or an equity financing, to meet ongoing cash
requirements. In that event, the Company and its
wholly owned subsidiaries would likely need to raise
additional capital from outside sources. There is no
assurance that the Company or its subsidiaries
16
BAYCORP HOLDINGS, LTD.
would be able to raise such capital or that the terms
on which any additional capital is available would be
acceptable. If additional funds are raised by issuing
equity securities, dilution to then existing
stockholders will result.
Primary Reliance on a Single Contract. BayCorp's
principal source of revenue is its wholesale
electricity trading business, which depends in large
part on GBPM's contract to sell power to Unitil.
Accordingly, BayCorp's results of operations
significantly depend on continued and successful
performance under the Unitil PPA.
Risks Associated with Post-Closing Obligations from
the Seabrook Sale. On November 1, 2002, Great Bay and
Little Bay sold their interests in the Seabrook
Project. In the Purchase and Sale Agreement for the
Seabrook Project, FPL Energy Seabrook agreed to
indemnify Great Bay and Little Bay against certain
claims specified in the agreement. Great Bay and
Little Bay also agreed to indemnify FPL Energy Seabrook
against certain claims specified in the Purchase and
Sale Agreement. If a claim is brought against Great
Bay and Little Bay for which FPL Energy Seabrook is
required to indemnify Great Bay and Little Bay but FPL
Energy Seabrook fails to provide such indemnity, or if
Great Bay is required to indemnify FPL Energy Seabrook
pursuant to the agreement, then the Company's results
of operations could be materially different. In
addition, Great Bay and Little Bay have deposited funds
into an escrow account for the payment of Seabrook pre-
closing expenses received subsequent to Closing. The
amount escrowed was based on an estimate of those
expenses. Should actual expenses be greater than the
amount escrowed, additional funds will be required.
Extensive Government Regulation. The electric energy
industry is subject to extensive regulation by federal
and state agencies. GBPM is subject to the
jurisdiction of the FERC and, as a result, is required
to file with FERC all contracts for the sale of
electricity. FERC's jurisdiction also includes, among
other things, the sale, lease, merger, consolidation or
other disposition of facilities, interconnection of
certain facilities, accounts, service and property
records.
Risks Related to HoustonStreet. HoustonStreet's
revenues depend on continued and expanded use of
Internet-based wholesale energy trading platforms.
Electronic trading of wholesale energy is new and
evolving, and thus may not achieve widespread market
acceptance or emerge as a sustainable business. In
addition, HoustonStreet will need to enhance trading
liquidity in order to increase and sustain revenues.
As a technology-dependent business, HoustonStreet's
business could suffer due to computer or communications
systems interruptions or failures, technological change
or adverse competitive developments. Further, as
electronic commerce evolves, federal, state and foreign
agencies could adopt regulations covering issues such
as user privacy, content and taxation of products and
services. If enacted, government regulations could
materially adversely affect HoustonStreet's business.
Although HoustonStreet currently is not aware that it
infringes any other patents, it is possible that
HoustonStreet's technology infringes patents held by
third parties. If HoustonStreet were to be found
infringing, the owner of the patent could sue
HoustonStreet for damages, prevent HoustonStreet from
making, selling or using the owner's patented
technology or could impose substantial royalty fees for
those privileges. If any of the foregoing risks
materialize, or other risks develop that adversely
affect HoustonStreet, or if HoustonStreet fails to grow
its revenues and net income, BayCorp could lose all of
the value of its investment in HoustonStreet.
Item 3. Quantitative and Qualitative Disclosures About
Market Risk
Commodity Price Risk
17
BAYCORP HOLDINGS, LTD.
The prices of electricity are subject to
fluctuations resulting from changes in supply and
demand. Great Bay sold a portion of its electricity
through forward, fixed-price energy trading contracts
in prior years, including in 2002. GBPM tracks market
exposure for any forward firm energy trading contracts
in a mark-to-market model that is updated daily with
current market prices and is reflected in the Company's
balance sheet. The positive, or negative, value of the
portfolio of forward firm power commitments represents
an estimation of the gain, or loss, that Great Bay and
GBPM would have experienced if open firm commitments
were covered at then-current market prices. As of June
30, 2003, GBPM had an unrealized loss on the mark-to-
market of forward firm fixed energy trading contracts
of approximately $716,000.
Item 4. Controls and Procedures
BayCorp management, including the Chief Executive
Officer and the principal accounting officer, have
conducted an evaluation of the effectiveness of
disclosure controls and procedures, pursuant to
Exchange Act Rule 13a-15(b), as of June 30, 2003.
Based on that evaluation, the Chief Executive Officer
and the principal accounting officer concluded that the
Company's disclosure controls and procedures are
effective in ensuring that all material information
required to be filed in this quarterly report has been
made known to them in a timely fashion and no changes
are required at this time.
In connection with the evaluation by BayCorp
management, including the Chief Executive Officer and
the principal accounting officer, of BayCorp's internal
control over financial reporting, pursuant to Exchange
Act Rule 13a-15(d), no changes during the quarter ended
June 30, 2003 were identified that have materially
affected, or are reasonably likely to materially
affect, BayCorp's internal control over financial
reporting.
Part II - OTHER INFORMATION
Item 5. Other Information
On August 11, 2003, the Company issued its second
quarter 2003 earnings release. The earnings release is
Exhibit 99 to this Form 10-Q.
Item 6. Exhibits and Reports on Form 8-K
(a) See Exhibit Index.
(b) There were no reports on Form 8-K submitted for
the three months ended June 30, 2003.
18
BAYCORP HOLDINGS, LTD.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BayCorp Holdings, Ltd.
August 12, 2003 /s/ Frank W. Getman Jr.
------------------------
Frank W. Getman Jr.
President and Chief Executive Officer
19
BAYCORP HOLDINGS, LTD.
EXHIBIT INDEX
Exhibit No. Description
- ---------- -----------
10.1 1996 Stock Option Plan of BayCorp Holdings,
Ltd., as amended on April 28, 2003.
10.2 Non-Statutory Stock Option Agreement, dated
as of April 28, 2003, by and between Frank W.
Getman Jr. and BayCorp Holdings, Ltd.
10.3 Non-Statutory Stock Option Agreement, dated
as of April 28, 2003, by and between Anthony
M. Callendrello and BayCorp Holdings, Ltd.
10.4 Incentive Stock Option Agreement, dated as of
April 28, 2003, by and between Frank W. Getman
Jr. and BayCorp Holdings, Ltd.
10.5 Incentive Stock Option Agreement, dated as of
April 28, 2003, by and between Anthony M.
Callendrello and BayCorp Holdings, Ltd.
10.6 Non-Statutory Stock Option Agreement, dated
as of April 28, 2003, by and between BayCorp
directors and BayCorp Holdings, Ltd., schedule
of individual grants included.
31.1 Certification of President and Chief
Executive Officer (principal executive
officer) pursuant to Exchange Act Rules
13a-14 and 15d-14.
31.2 Certification of President and Chief
Executive Officer (principal financial
officer) pursuant to Exchange Act Rules
13a-14 and 15d-14.
31.3 Certification of Vice President of Finance
and Treasurer (chief accounting officer)
pursuant to Exchange Act Rules 13a-14 and
15d-14.
32.1 Certification of Chief Executive Officer and
Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Vice President of Finance
and Treasurer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
99 BayCorp Holdings, Ltd. Earnings Release for
the quarter ended June 30, 2003.
20