8-K 1 h93045e8-k.txt EAST COAST POWER LLC - DECEMBER 21, 2001 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------- FORM 8-K ------------- CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT: DECEMBER 27, 2001 (DATE OF EARLIEST EVENT REPORTED: DECEMBER 12, 2001) COMMISSION FILE NUMBER: 333-45124 ------------- EAST COAST POWER L.L.C. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 52-2143667 (State or Other Jurisdiction (I.R.S. Employer of Incorporation or Organization) Identification No.) EL PASO BUILDING 1001 LOUISIANA STREET 77002 HOUSTON, TEXAS (Zip Code) (Address of Principal Executive Offices) Registrant's Telephone Number, Including Area Code: (713) 420-2600 ================================================================================ ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS On December 12, 2001, we distributed the Bayonne Venture and Camden Venture power purchase agreements with Public Service Electric and Gas, which had a book value of approximately $233 million, to our members, Bonneville Pacific Corporation and Mesquite Investors, L.L.C. This distribution was done in connection with a power contract restructuring which was contemplated and reported in our Form S/4A, and is in accordance with the terms of our indenture. This current report on Form 8-K is being filed to reflect the significant distribution of these assets, as well as other transactions occurring as part of this restructuring process. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS b. Pro forma financial statements We are providing the accompanying unaudited pro forma condensed combined financial statements to reflect the following transactions as if we had completed them as of January 1, 2000: o Our acquisition of the remaining ownership interests in Camden Venture for approximately $71 million and our acquisition of the remaining 7.875 percent of Bayonne Venture for approximately $25 million which resulted in the consolidation of Bayonne Venture in our financial statements; o The redemption of approximately $176 million of our outstanding senior secured notes; and o Our equity distribution of the power purchase agreements with Public Service Electric and Gas to our members. Had the actual distribution of our power purchase agreements occurred on January 1, 2000, our Camden facility would have operated under merchant conditions, or, in other words, the power sold and the operations of the plant would have been determined based on factors existing in the wholesale electric markets. As a result, the historical operating revenues and operating expenses would have been different, possibly materially, than those revenues and operating expenses reported in these historical financial statements. We have given effect to the electric revenue under wholesale market conditions in the pro forma financial statements for the Camden facility based on the twelve and nine month averages of month-end market prices for the periods ended December 31, 2000 and September 30, 2001. An affiliate of ours negotiated to purchase, at a fixed-price, the 24.2 percent of the Bayonne facility electrical output previously sold under the Public Service Electric and Gas power purchase agreement. The pro forma financial statements reflect the fixed-price contract as if it had been negotiated on January 1, 2000. The following unaudited pro forma condensed combined financial statements as of, and for the nine months ended September 30, 2001, and for the year ended December 31, 2000, have been prepared based on our historical consolidated balance sheet and our historical consolidated statements of income. The Unaudited Pro Forma Condensed Combined Statements of Income give effect to the transactions identified below as if they had occurred on January 1, 2000. The Unaudited Pro Forma Condensed Combined Balance Sheet gives effect to the transactions as if they had occurred on September 30, 2001. The unaudited pro forma condensed combined financial statements are not necessarily indicative of our consolidated financial position or results of operations that might have occurred had the transactions been completed at the beginning of the earliest period presented, nor do they necessarily indicate our consolidated operating results and financial position for any future period. The pro forma adjustments to electric revenues do not reflect the volumetric differences that would have occurred under wholesale market conditions and therefore would not be indicative of anticipated revenues or expenses following the distribution of the power purchase agreements. The accompanying Notes to the Unaudited Pro Forma Condensed Combined Financial Statements explain the assumptions used in preparing the financial information. The losses we incurred on the transfer of the Bayonne Venture and Camden Venture power purchase agreements are reflected on the Unaudited Pro Forma Condensed Combined Balance Sheet as of September 30, 2001. We did not give effect to these losses in the Unaudited Condensed Combined Statements of income for the nine months ended September 30, 2001, and the year ended December 31, 2000, since these are non-recurring items. 2 EAST COAST POWER L.L.C. UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF SEPTEMBER 30, 2001 (In millions)

See accompanying notes. 3 EAST COAST POWER L.L.C. UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 (In millions)

See accompanying notes. 4 EAST COAST POWER L.L.C. UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 2000 (In millions)

See accompanying notes. 5 EAST COAST POWER L.L.C. NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (a) To record (i) the payments of the principal, accrued interest and penalties associated with the prepayment of the Bayonne Venture term loan funded by a loan from an affiliate and (ii) the reduction of the historical interest expense for the nine months ended September 30, 2001, and for the year ended December 31, 2000, based on the Bayonne Venture term loan's interest rate at September 30, 2001, which was approximately 10.85%. (b) To record (i) the payments of the principal, accrued interest and penalties associated with the prepayment of the Camden Venture term loan funded by a loan from an affiliate, (ii) the realization of the loss on the interest rate swap and (iii) the reduction of the historical interest expense for the nine months ended September 30, 2001, and for the year ended December 31, 2000, based on the Camden Venture term loan's interest rate at September 30, 2001, which was approximately 8.5%. (c) To record the borrowings from an affiliate to fund the acquisition of the additional ownership interest in Camden Venture. (d) To record the eliminating and consolidating entries related to our investment in Camden Venture, as follows:

(e) To record (i) the redemption of approximately $176 million of the outstanding senior secured notes funded by a loan from an affiliate, (ii) the write-off of debt issuance costs associated with the portion of the senior secured notes redeemed, and (iii) the reduction of the historical interest expense for the nine months ended September 30, 2001, and for the year ended December 31, 2000, based on the senior secured notes' interest rate at September 30, 2001, which was approximately 7.15%. (f) To record the distribution of the Bayonne Venture and Camden Venture power purchase agreements to our members. (g) To record the repayment of the note payable from affiliate from contributions received from our members. (h) To record the impairment charge and the reduction in depreciation expense associated with the plant assets of Bayonne Venture and Camden Venture, as a result of distributing the power purchase agreements to our members. (i) To record the elimination of our equity earnings in Bayonne Venture. (j) To record the elimination of our equity earnings in Camden Venture. (k) To record the amortization associated with the excess costs assigned to the remaining Bayonne Venture power purchase agreement with Jersey Central Power and Light. (l) To record the reduction in Camden facility electric revenue for merchant conditions based on averages of the applicable month-end wholesale electric market prices and historical generated electricity volumes for the nine months ended September 30, 2001 and for the year ended December 31, 2000. (m) To record the reduction in electric revenue for 24.2 percent of the Bayonne facility based on the contractual price between the Bayonne facility and an affiliate and historical generated electricity volumes for the nine months ended September 30, 2001 and for the year ended December 31, 2000, as if the fixed-price contract had been entered into on January 1, 2000. c. Exhibits None. 6 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. EAST COAST POWER L.L.C. Date: December 27, 2001 /s/ JOHN L. HARRISON ------------------------------------- John L. Harrison Vice President, Senior Managing Director (Principal Financial Officer) Date: December 27, 2001 /s/ CECILIA T. HEILMANN ------------------------------------- Cecilia T. Heilmann Vice President, Managing Director and Controller (Principal Accounting Officer) 7

EAST COAST POWER LLC 8-K