 This is an evidentiary hearing in case number 19-1081-PTT. This is the Public Utility Commission's review of the petition of the Navarro, Inc. for approval of an indirect acquisition of a controlling interest in Vermont Gas Systems, Inc., Green Mountain Power Corporation, and subsidiaries of Green Mountain Power Corporation. My name is Andrea Papini, and the commission has appointed me to be the hearing officer for this proceeding. And with me today are Kyle Mades-Marinello, general counsel for the commission, and Mike Towsley, staff attorney. Before we get started, I wanted to acknowledge that the commission has received 75 public comments on this matter. And we appreciate the effort that the public has put into this. So thank you, and I just wanted to acknowledge that. So I'll start by taking appearances. I'm Daniel Burke, and behalf of the Department of Public Service with me today is Jim Porter, the Department of Director for Public Advocacy, and seated behind me are our witnesses, Mr. C.B. Peril, and Mr. Leonard Cajalla. James Dumont for the interveners. With me on the right is Lothar, Tilly and Cowley, from Duvall Law School, and my left is Mr. Garger, and that's what we'll do here. Good morning. I'm Deborah Blufar from the law firm of Sheehy, Furlong, and Beam. I'm here today on behalf of Noverco, and joining me is the president and a board member of Noverco, Renau-Fochet, and seated behind me is my law partner, Owen McLean. So have the parties stipulated to the admission of the pre-file testimony and the exhibits? I don't object to the admission of any pre-file testimony. So I'm going to go ahead and admit those into the evidence now. That's three rounds of testimony by Mr. Fochet, and one exhibit and the department's testimony of July 9th, when those are admitted. Let's proceed with Mr. Fochet. Noverco calls Renau-Fochet to testify. Good morning, everyone. You can raise your right hand. Do you swear or affirm under penalty of perjury that the testimony you are about to give will be the truth of all truth and nothing but the truth? I swear. Thank you. Mr. Fochet, could you state your full name for the record, please? My name is Renau-Fochet. And since the parties have stipulated to the admission of the pre-file testimony, I will make the witness available for examination. Mr. Nunez, Mr. Fochet, Mr. Fochet, according to your pre-file testimony. Jim, can you pull the mic closer? I think so. How about this? Is it on? Is there a green light? I doubt there's a green light. OK. Thank you. The pre-file testimony on page 3, the tail end of your answer number 4, you state, finally, I explain that the transaction promotes the public good under 30 BSA section 107 because it is not, I think you mean to say, because it is not a fundamental change in the upstream ownership. The change in ownership is very remote from the remote utilities, and the transaction will have no impact on the remote utilities or their customers. Can I read that correctly? Yes. And exploring that with you, I want to start with what you marked as your exhibit 1, which is the structure of the various companies. I've actually prepared a copy of it for you to mark up. So we have a separate exhibit that we're going to call in two years, cross 5. I'm going to approach the bench and give the copy with a sticker on it to the witness. Jim, I'm sure you're working from this side. I have two. Did you take theirs? I'd like you to mark up this exhibit a little bit to get started. The top left on the first page has no verco ink. I'd like you to add in in your own handwriting using the same format as this chart. Who owns the verco ink? I think. Explain in my testimony who owns the verco ink and write it for you if you want. Yes, I mean, for the same reason you prepared exhibit 1 because it helps to understand this complicated situation with the graphic. I'm giving you this exhibit to mark up to add to the graphic so we can see visually who owns the entire parent-child relationship here. So the two owners of no verco ink are Trancap and IPA. Trancap owns 61.11% of the grade of no verco and IPL owns 38.89%. Then I'm going to ask you to put on the graph, who owns IPL? I don't know. You can do it on the side. The exhibit you prefiled, you had the percentage of ownership. So are you able to add that in your handwriting for the percentage of ownerships of the companies that own the verco and the company that owns IPL? Yes. It's not exactly verco. I'm sorry. That's all right. Now, on the same page, on the right-hand side, it says public. Do you see that? Yes. You circle the word public. On these parent-child charts, one, two, three, four, five pages that you submitted, is there any other entity other than Valinear? It's publicly owned. You've been practicing in the utility field as a leader trained as a civil engineer. Is that right? You're familiar with regulatory concepts, governing utilities in Canada? I assume. There's an assumption as to who does mine. All right. You know the difference between a publicly held corporation and a privately held corporation in Canada? Publicly held corporations make public disclosures, correct? Correct. Not really held corporations don't make public disclosures, correct? It depends. It depends? They're not required by Canadian securities laws to make public disclosures, are they? It depends if they act public debt. That's the public debt. Are any of the entities on your exhibit public debt? Yes. Which ones? Energia. I'm sorry. I didn't hear. Energia. So is Energia a public corporation that makes quarterly filings with Canadian securities authorities? It's not a public corporation, but it makes filings for its debt. It certainly makes filings. For its debt to report on its debt. But it's debt. Yes. In your chart you didn't describe Energia as a public entity. Why is that? I didn't see it was a public entity. Let me show you what we've marked as exhibit cross one. Which is the 2018 annual report of Valenier. Have you ever seen exhibit cross one before? No. So you've never looked at Valenier's 2018 annual report? No. I don't sit on the board of Valenier. I didn't look at those before. Why don't you take a second and look at it and see if it looks like it's the kind of document a reasonable person would rely upon. Could you repeat your question? Yes. I just wanted to be sure I understand. Yes. When I ask you to look at the document and see if it appears to be the kind of document a reasonable person would rely upon in the context of their affairs. I'm going to jump to the question. I think it's a legal request and it's going to whether or not this would be a document that could fall under a three BSA section 810. This isn't in a position to answer that question. I'll move the exhibit. I mean how representatives downloaded from Valenier's website yesterday. Yes. An objective report being admitted. The witnesses testify that he's not reviewed it. It's not something he would review in the course of his work. He doesn't sit on the Valenier board. So there's no foundation to admit the exhibit. The exhibit is the kind of document that reasonable people do rely on. They have to rely on if they're going to make investment decisions. The same is true of the next exhibit I intend to offer, which is Valenier's 27th report. And the next exhibit, which is Valenier's first quarter report for 2019. And all of which qualify as admissible under the board's rules of the statute and which bear upon the issues in this case. I'd like to let you proceed with your questions and then we'll determine Mr. Crochet, would you agree that why should describe the relationship between Noverco and Valenier? Noverco and Valenier both show a bit of energy here. So you're the president of Noverco? But you've never read the annual reports or the call reports of the partner in ownership of the company that the president of? That's what your testimony is? You don't read Valenier's annual reports? I don't read an annual report, you know? Do you read the quarterly reports? I don't read the quarterly reports. Now, we're here because Noverco proposes to purchase shares of Valenier, correct? As the president of the board of Noverco, you recommend that? You have recommended that, correct? Without leading the annual reports to the company you're recommending to buy the shares of? Is that what your testimony is? Did you ask the question again? As president of the board of Noverco, you have voted in favor of purchasing shares of Valenier, buying Valenier out, correct? But you've never read their annual reports? Is that your testimony? Objection, this question has been asked and answered twice already. Is this your question, please? Could you read it? But you've never read their annual reports, is that what your testimony is? I've never read your detailed annual report. You assume you've never read them in detail or you've never read them? I've never read them? Have you read the notice of special meaning of shareholders to be held on June 11, 2019? This issue is on April 24, 2019 for the purpose of this very proposed acquisition. I did in part. Four on the handle of this exhibit. Are you familiar with exhibit four? Yes, I've seen it. Have you read it? I believe it's accurate. This is a difficult question for me to answer. Yes, I believe it's accurate. I believe for exhibit four. I'm going to object on relevance grounds for how this is relevant. This is the description by a valineer of the very transaction that is before the commission for approval. Specifically, I'm not sure how this is relevant to 10 million new issues that are directly under consideration. Sir, do you mind if I just clarify that this is a public document that's publicly available? It is. And I obtained this from the valineer's website yesterday. Either under the board's rules or under the judicial notice rules. It would qualify to read it all. Maybe it would be helpful if we proceeded to the questions so I could better understand what the point is that for which the engineers seek to admit this and then you can deal with the mission question. So I have a question for Mr. Boucher that just may help answer if you can help answer it. Would you agree that the core business energy year is the sale of natural gas in Quebec and in Vermont? Energy year has started with the Quebec distribution of gas distribution about sometimes ago, many years ago, around gas was added. But also another subsidiary was added to our group with the acquisition of CDPS. Energy year has diversified since then into renewables. They have bought and constructed one of the biggest wind farms in Quebec. They just made another acquisition which is the solar business in Maryland. So it's a diversified one. I confess I'm having a problem because I've been looking at page numbers that are PDF numbers which turns out don't correlate with the numbers on this I'm taking to make the correlation. My question was I'll ask for a break to find the right page if this doesn't work. My question was about the core business of energy year. Is the core business natural gas distribution in Montreal and Quebec? I think the core business is distribution of energy. Look at section 4.13 of exhibit 4. Here it is. Page number 27. Does it describe Vélanir as follows. Vélanir is an investment holding company whose business consists principally in the ownership of an approximately 29% economic interest in energy or LP. Vélanir therefore is engaged in the regulated energy business in Canada and the United States through its interest in energy or LP. The core business operations of energy or LP involve natural gas distribution in Quebec and Vermont as well as electricity distribution in Vermont. Period. And then it states Vélanir through its subsidiaries for the interest in wind farms. Can I read that correctly? Correct. So did Vélanir pursuant to Canadian securities laws represent to shareholders that energy year's core business operations involve natural gas distribution in Quebec and Vermont as well as electricity distribution in Vermont. Do you agree with that? Yes. What other entities does energy or LP own other than sorry what other entities does Novirco own other than energy year? None. So when Novirco directors get together to meet the only business they talk about their core business, correct? What's your understanding of why they're separate companies? I'll Can I go back? Sure, go ahead. The other Novirco was two one entity which owns directly which is Energy Inc. You have to speak a little bit, it's called Energy Inc. The general partner of Energy and LP and we have some assets we have some shares so sometimes we talk about the shares. Back to my last question What's the reason that Novirco is a separate entity from Energy Inc? Novirco in the past has looked at making other acquisitions in the past. Let me jump ahead of what I've written down here and ask you a question that occurs to me. If Novirco has no other business than Energy Inc. Why did you answer all the discovery questions strictly on behalf of Novirco without disclosing information that Energy Inc possess? That's a good question because the board are distanced between Energy and Novirco. The board of Novirco is not the same as the board of Energy. Energy as another owner and the boards are different. The board members are different. Novirco is a holding company doesn't have any employees and Energy is as its own board with its own management with its own operation. The operations of Novirco are strictly as a holding company. We could go back to your exhibit one which you are marking up as our exhibit 6. Don't throw the companies on that first page. Tell us which ones have boards of directors that are elected by shareholders. Shareholders that let me rephrase that question. Exhibit 4 which is the Notice of Special Meeting of Shareholders pertains to that's a company that has thousands and hundreds of thousands of shareholders, correct? Exhibit 4 is the Notice of Special Meeting of Shareholders. I'll have it in front of me. You should have a yellow sticker with number 400 on the bottom. I'll have it in front of me. To the front side. There you go. Do you know how many shareholders Melonio has? I don't know the number of shareholders. Thousands. How many shareholders does Novirko have? How many shareholders does Energier have? Two. That's Energier Inc. Go ahead. Could you please ask your question? I should have been more clear. How many shareholders does Energier Inc have? One. That's Novirko. How many shareholders does Energier LP have right now? Two. How many shareholders does Valinier and Energier have? Yes. How many shareholders does Northern New England Energy Corporation that Vermont Corporation have? One. That's Energier LP. Yes. And how about NNEEC, Quebec Inc. How many shareholders? One. How about from IPS Systems, how many shareholders? One. Green Mountain Power, how many shareholders? One. Going down on your page. Vermont Transco, how many shareholders? I don't know because it's 72.07%. So I'm assuming there may be other shareholders in there. Okay. And Vermont Electric Power Company? The same. 38.8%. So going back to Valinier, would you be fair to characterize it as a publicly owned company? It says publicly owned company. Until the purchase happens, it's a publicly owned company. Correct? But if the purchase happens, there will no longer be any publicly owned companies up or down the chain of command that ultimately stops the Vermont Gas Systems and will be non-powered. Correct? Correct. So disclosures for public, such as we've marked exhibits one, two, and three annual reports, quarterly reports, there will no longer be any annual reports or quarterly reports that are publicly available that discuss Vermont Gas Systems business or being non-powered business. Correct? Valinier, you know, but I understand that energy or ink where all of this stands, okay? Energy or ink where all of this is will have to report on the quarterly and annual basis. Report to whom? To the financial institution as to it's because it holds debt? Because it holds public debt. So is it reporting us to the public debt or is it reporting to the activities of the city or extended hours? It's reporting the financial statements as they are they will have to be reported. I don't know that that's my understanding. When I read your chart it appeared to me that the only public institution publicly owned entity is Valinier. That's what you wrote in the chart, correct? Correct. I'll represent to you that when I tried to find public documents for energy or ink I couldn't find any. Maybe I was looking the wrong place. How would you find documents for energy or is it energy or ink or energy or LP that you were saying holds public debt? Energy or ink. Energy or ink. So energy or ink you think may publicly expose facts about it's amounts of figures? Energy or ink has to publish its financial statements I think it's under what we call in the CDAR website. I'll represent to you that if you go to the CDAR website and put in energy or you won't find anything. I'm not testifying but I'm asking you if that's surprising if you're aware of that. I'm surprised. Be that as it may energy ink has one shareholder correct? Correct. And Velenir has thousands. Correct? Correct. Whatever duties may apply to disclosure to owners of publicly held shares publicly sold shares that will cease to apply. Those duties will cease to apply. Do you believe it promotes the public good of mind? Or it's the largest gas utility to be completely owned by private densities of the chain of command of the parent child lighter of whatever we call it? As I stated to in the answers to the petition the main reason this transaction is proposed is to buy Velenir because Velenir one of the issues of Velenir is their limited financial capacity to support energy in its potential growth. You say that in your pre-plot testimony how long have you been president of the vertical? Since 2014. Have there been any instances where from our gas from remount power heated capital and they were not able to obtain it? Not from my knowledge. If you don't know who would know. But making sure there's no restriction on funding capital can only be a benefit. Some of those restrictions that apply to Velenir include disclosure to the public, correct? What's the question? Velenir's contributions to the capital of PGS or GMP which show up in its quarterly reports, correct? Could you just rephrase the question here and I'm not sure I understand. You're discussing the ability of a remount power to obtain capital, correct? Is that the question? I thought that's what you said was the advantage to remount of allowing the sale to go forward. One of the advantages is to continue on supporting that we've like Novaco has done and Energy Air has done for the last how many years have you thought of the investments here in the subsidiaries? You said that while you've been president there's never been any instance where I'm not going to ask of remount power to obtain the capital-based desire, correct? Correct. Does your knowledge extend extend back in time before you were president? I'm not aware of any situation. Is that being the question you can tell us whether you know? Before you were president was there ever any instance in which remount power and remount gas sought capital from the pair of corporations and were unable to obtain it? You started to say that access to capital is not the only reason this promotes the public What other reasons are there? The other reasons I think is we've been supporting Energy Air has been supporting the goals of the subsidiaries here for quite some time and this will continue without having any issues with capitalization in terms of funding or requirements or ensuring that Energy Air has the proper funding to grow. Why does growth of Energy Air as opposed to the rock gas or remount power promote the public good of the world? This transaction is a transaction which for Energy Air is be able to grow Energy Air Sir, is able to what? To outgrow Energy Air Energy Air wants to look at market opportunities and market opportunities are defined as potentially other LBCs in other states or in Canada and it also continues supporting the goals of energy here. It doesn't change it doesn't have any impact upstream of what's happening in Vermont It doesn't have any impact on management it doesn't have any impact on the boards it doesn't have any impact on the day-to-day business of Vermont utilities for the strengths and the capital that needs to be provided to Energy Air to support these goals. If I understood you correctly you're agreeing that the only benefit the only aspect of the sale that you believe promotes the public good of Vermont is improved access to capital the other benefits are Canadian benefits, Energy Air benefits is that right? and you've agreed there's never been any problem obtaining capital for Vermont gas or being unpowered until then witness testified to if you asked him if in his term as the president he was aware and he said no and then when you asked him prior to him being president he said I don't know that's different than it never happened okay that clarification yes never been any problem in obtaining capital for the Vermont gas or being unpowered until now are you saying you want to rephrase that question yes I know I'm going to be a little legalistic when I do it so Mr. Crochet bear with me do you understand the concept of burden of proof do you know what that is maybe you want these the party that wants the commission to do something it's their job to convince the commission that it's the right thing if they don't meet that burden of proof they lose regardless of what you or I might believe of the facts outside of the commission the commission process advancing that once something happens to prove that it should happen that's a very fundamental explanation of burden of proof so I've asked you about difficulty in accessing or problems in accessing capital you said there have been no problems while you were president if you know of that before you were president you're as close as you don't know so and you need to go back okay I'll do that question there's been no problem I don't know about that and I don't know how to access their capital and how challenging it was to access their capital to fund energy in terms of their capital injection with that I don't know if you're involved with the O'Barre program we might empower a subsidiary in the city of Skoll one of its subsidiaries what is the question was was I involved in no better call when I'll ask a better question what is the agreement power used to be a publicly owned corporation were you aware of that were you aware of the agreement power and the predecessors of Northern New England and energy here in America came to this commission and said the principal reason one of the principal reasons you should approve of its Canadian corporation becoming a sole shareholder the owner of Vermont's largest electric utility is because it will approve their access to capital were you aware of that Northern New specifics because it dates back to 2007 if I recall correctly so when I tell you that you were aware of that factor in the commission's decision I haven't read the commission's decision transcript so I'll represent to you that was one of the principal justifications for the approval and you testified you're not aware of any difficulties Vermont gas agreement power had an access to capital correct you testified this morning that whatever the public disclosures might be that are required of energy because it holds public debt energy has only one shareholder the vehicle correct and energy has only one shareholder no that's cool and after this approval sorry after this transaction it is approved if it's approved energy or LP itself will have only one shareholder correct it could have two but controlled by the same shareholder so if you look at exhibit a P5 is the main exhibit fourth page of your exhibit 1 which I have been working out as R to the 6 fourth or the fifth page it's labeled 3B as a baby fourth okay that's page 5 what does that tell you energy or LP will have two shareholders one of them could be an Elco is that what you're saying which is itself owned by no vehicle correct I have to show you what I've marked as R exhibit cross 6 I'll let you start I have to be right so before I move on to 6 I'm going to move 5 which is the market version of this pre-public exhibit 1 6 so could you look at R exhibit cross 6 it's got some time I'm going to ask you to make any corrections in it that you think are appropriate then once it's correct I'm going to move to a minute can I ask you exactly what you're trying to do here we're trying to show whether your pre-public testimony stating that Vermont gas being on power are autonomous is accurate in each of those columns does that affect all of your members we did not include all of the directors of the agency we included the ones that appear to have a relationship with energy or trend cap and bridge and bridge please do and then you see directors yes yeah yeah yeah yeah yeah he's not working for energy he was the chief financial officer and executive vice president of energy year at one time until the end of 2017 my early collection is correct he worked at energy year formerly known as gas natural for a very long time he became chief financial officer and executive vice president and this is still on the board of NNEDC yes but he doesn't have any moral relationship with energy is he paid or does he serve as a volunteer but he's not by energy he's not an employee of energy any more since 2017 we wrote on exhibit class 6 his name and I apologize for the stone we left the S off of this far we wrote that he's now retired so with that verification is this exhibit correct I want to just understand what I don't understand what this exhibit is and is it a summary of the discovery responses is that where the information came from this information came from the discovery responses and the exposures on the Vermont sector this website is to the board of directors of the Vermont entities and what is it intended to show again it's intended to throw into doubt something that appreciates pre-planned testimony about the autonomy of cleanup and power of the Vermont gas facilities and even before that I don't understand what why are only some of the board members listed we we're trying to show the overlapping directors so and their connections to the parent companies for example we didn't list Mr. Rendell Mr. Rendell is on the board of NNPEC and he's on the board of DGS that we didn't list him because everybody in this room knows who he is and knows what his connections are I think that one of the exhibits you had in your cross packet were the discovery responses so if there's questions about the numbers of the respective boards it seems like it would be more logical just to ask questions about that exhibit as opposed to your summary exhibit here well that's why I showed it to the witness whether they just put this in the brief trying to distill fairly complicated relationship among five or six different companies with overlapping directors on one page and give the witness an opportunity to show where we've made a mistake I think there's potential for this exhibit to be misleading and it's not presented together with the discovery response that shows the full make up of the board but no objection to this coming in so long as the commission has also presented I guess the discovery response we were planning to move to the discovery response as well again I have no problem with that it's just my concern is if you pick up what you've labeled as cross six this document in and of itself doesn't tell you what it is according to representatives it says overlapping directors that's the principle and we added this she summarizes the fact from the discovery answers that the entire board NN, EEC is appointed by energy year the entire boards of EGS and GMP are appointed by NN and as it states the discovery each one of the appointments is ended the same information is on the discovery responses except the discovery responses are complete is that right? except the discovery responses occupy about 15 separate pages I'll let discovery responses about the board membership that show the complete membership the board of two pages correct and they have all the information not just incomplete information they do not have all the affiliations that's one of the purposes for any reason they list the affiliations and then they list where those who appoints each member is that not right? the discovery responses entirely complete it does not have the description for Mr. Unglow does Mr. Chance does Mr. Carl does and so on I think that's incorrect I think the discovery responses should list the worst is stupid which discovery responses are entirely complete the discovery responses to the department's questions we have it's process seven process of it page 11 it's on a number of other pages it seems as though you're trying to ask a very large compound question are all of these categories all the information on this sheet accurate is that what the testimony you're trying to elicit? that's correct so that you could ask all of those questions individually and you could get answers from the witness and all those questions individually but we take out an additional amount of time but if that's your preference then that would be the normal way to proceed in this situation my preference would be that if we're going to be asking the witness questions about the various members of the boards different boards that we work from a complete set of responses that list out those folks and we could do that without this summary exhibit that appears to contain information that Mr. Dumont found somewhere else so my preference is we just work from the responses that were provided in the discovery my concern is that the full list of the boards of directors for each of the relevant corporations is not currently having an entry record in this exhibit in isolation without having access to the broader list it potentially creates this could be potentially prejudicial let me move it to the cross stage which is the answers to the witness questions I wouldn't have objections are you moving for the entirety? yes I'm okay with that I know we covered my concern on things in the process no I guess I'm wondering if I do think should we want some title to ask the witness questions about every category and their understatement that's on this document that is going to take up a fair amount of time I wonder a better way to proceed would be to take a short break and have the witness spend some of that time looking more closely at this document and come back on the record and see if there's an objection to do it in that streamlined fashion and take it from there thank you that's outside would you like to discuss if you would like to give it I think we'll need to just have the witness answer the questions about this because it's still confusing and to answer the questions we think Attorney Dumont has about autonomy and what was in the testimony we'll need to have the witness explain okay I'm sorry to input that that play out please Mr. Crochet is start with how about canton usually with that person what's the full name Derrick Compton and was Mr. Trenton canton appointed to the board of numerical by trend cap yes Duquette who is Duquette François Duquette appointed to the board of numerical by trend cap by which is correct by its general partner I indicated in my testimony trend cap is managed by the general partner subsidiary of you're going to have to spell that one for everybody I know what it is but for the record why don't you spell it yes C-A-I-S-S-E D-E D-O-D-E-P-O-T Du D-U correct someone named François clarifying question does the general partner have a name as well yes it's in the testimony get it it's capital CDPQ so it's a testimony of June 7 page 3 question 5 answer so that's the CDPQ is the acronym for as the default correct that's the general partner that's the owner of the general partner sorry to interrupt if I could ask the cameras to stay on this side of the other side of that please thank you very much the next person listed in our exhibit is yourself correct correct were you appointed to the board of numerical by trend cap to the D-P-F trend cap which is correct and next is Grunting right saying that correctly correct, first name Colin and he was appointed by trend cap you was appointed to ideal by Enbridge miss Mr. Grunting is the vice president for treasury and tax for Enbridge correct was his title changed quite recently but that was his name I don't know when you pick up the title he's also the CFO of one of the Enbridge entities called the Enbridge income fund correct, I'll represent to you that this information comes from the website for Enbridge if that's the case and if we jump ahead one second he was appointed Colin Grunting was appointed to the numerical board sorry Mr. Grunting was appointed to the numerical board by trend cap and Mr. Grunting who was the vice president for treasury and tax for Enbridge is also a director of energy he has some energy correct you're right in calling me something which I didn't notice before in your first Colin I'll jump ahead Grunting and Mackie are appointed by two IPL by Enbridge Grunting is not appointed by trend cap thank you for that correction so we'll cross out trend cap without trend cap for Grunting and cross out Enbridge for Perry we should write in after Grunting Enbridge Perry what should we write in trend cap so Attorney Bluffard was correct person by person Mark Mackie appointed to the numerical board by Enbridge correct and he is the president of Enbridge energy partners correct if you found it on the website what's your knowledge he works for Enbridge he's been nominated by Enbridge he's the president of Enbridge energy partner I just know they had a reshuffle people it was not appointed by Enbridge it was appointed by trend cap what is the Miss Perry or Mr. Perry Mr. John Perry are there other new vehicle directors on the board right now who are not on this list the board or the director or something that's called at six board members so we have all six we have all six we've made it two trend cap directors of energy you Mr. Bonding and Mr. Markie is that correct as director of energy that's incorrect tell us please how to be correct if you go to the response to the first set of discoveries from the VPN H4 H3 the H4 H3 H4 H3 H4 H3 H4 H1 H3 H3 H3 H1 H3 H2 Jean-Luc Alain, Colin Grunding, Cynthia Henson, Jean Gould, Mark Macon, and Pierre Manin. Four numbers? Oh, sorry, let me start. Let's do it. This one, one more. Who appointed Mary Ann Bell? Alain Herr appointed Mary Ann Bell. Who appointed Sophie Rochoux? Sophie Rochoux, Alain Nogacau. Who appointed Marie Fichel? I will refer you back to the answer to the question I gave you on page three of the meeting here. And that will explain Nogacau as a show-shelter of energy and an agreed incumbent to elect representatives proposed by each shelter of Nogacau to the board of directors of energy and to ensure that each of them has representation on such boards of directors which correspond to its proportionate interest in Nogacau, provided so long as the shelter of Nogacau has an interest and it sets up 50% in Nogacau that this shelter will be entitled to propose a number of representatives corresponding to the majority of the directors of the board of energy. In addition to energy or LP, Alain Herr has limited partnership with its net of energy, Alain Herr currently known as three of the twelve more members of Energy Inc. based upon Alain Herr's proportion of unit holding in the limited partnership. The directors are elected on every basis by Nogacau and by NAC and remain in office until the next time Nogacau will be needed. Thank you. So going back to our exhibit, a tree we listed are three of twelve, correct? Which one? Which exhibit are you talking about? I'm sorry? The tree we listed were you, Mr. Grunding, and Mr. Machu. It was a tree out of twelve. But all twelve are appointed either by Valenier or by Nogacau. As I stated, yes. The three that we listed are also on the Nogacau board, correct? And that's the explanation I just gave you through the reasoning of my answer to the question of the EVS. We now go to the NNEC directors. If I turn to page four of your answer to the partner's discovery, tablet page four, NNEC has seven directors, correct? And the three that we listed here, Roshu, Roshan, and Espar, the first two, Roshu and Roshan, appear on other boards of directors. Roshu and Roshan are also on the remount and power board of directors, correct? Correct. And Espar, who's now retired, is not on any of the other boards of directors, but he was the CFO of Energia. He was the CFO of Energia and retired in the end of 2017. He's no longer employed by Energia since 2017. If we could now look back to page four of your answers to the partner's discovery, the majority four out of seven of the NNEC directors have worked for Energia or currently work for Energia or are Mr. Rendell. Four out of the seven, including Mr. Rendell, is a majority, and the four are three that have worked for work for Energia are Mr. Rendell, correct? And we have another question right there. The partner's discovery, the majority four out of the seven of the NNEC energy or currently work for four out of the seven, including Mr. Rendell, is a majority, and the four are three that have worked for work for Energia. Is there a lot of your answer there? The majority of the board in NNEC is four volts, correct? And the three of the seven board members who have a long-term relationship and are retired with Energia or currently work for Energia, correct? You probably answered your question too loud of this having currently worked for Energia. And the third is Mr. Despac. And the third is no longer working for Energia. Those three, you know Mr. Rendell does. So those would be fair to say that those four persons who have been for a long time currently are affiliated with or employed by a gas company that's primarily involved in the sale and distribution of gas. Sale and distribution of gas. Energia's core business is as we've indicated from the discussion into the floor, based in Quebec, is primarily Quebec and Vermont, correct? Does it have an electricity business in Quebec? It's generating electricity in Quebec. That's a win sense. It's a very, very large distributor of gas in Quebec, correct? It's one of the distributors of gas in Quebec, correct? It's the largest distributor of gas in Quebec. Those persons affiliated for a long time with the largest distributor of gas in Quebec plus Mr. Rendell are the majority of NNEDC, correct? Could you find your question in the majority of Quebec? The majority of the seven. Four is the majority out of seven. Four is the majority out of seven. The directors of NNEDC. And four directors are majority NNEDC. And that board appoints the board of directors of Green Mountain Power, correct? With the recommendation of the board of directors of the subsidiaries to whom they should appoint. The board of directors of Green Mountain Power is subject to losing their job, eating their job every 12 months, correct? Nine for NNEDC. Nine for energy here. Nine for any other board. They're all annual. The same way. Two for energy here. The same is true for NNEDC. We're looking at the current list of GMP directors. This is not the complete list of GMP directors. If you read it, there's Roshua and Mr. Lachance are two of the current GMP directors. Which exhibit you're talking about? It's our exhibit, six. I'm sorry, I just wanted to say six. Don't, could you repeat your question? Yes. Is it just six correct insofar as it states that there's Roshua and Mr. Lachance are currently GMP directors? In my response to the DPS, you were said of discovering on page four, you have GMP board which is the exhibit that GMP, the people who should be they read code, very professional, Nari Paolo, Francis Recky, Laurence Riley, Dave Wolk. Exhibit six is correct. It's showing that Carol Carl and Martin Inlow are not the entire DPS board of directors, but they are two of the DPS directors that present correct. Carl, Carl and Martin Inlow are two out of eight board members. Incorrect. Ask me to look at the description of Mr. Roshua, Mr. Inlow, Mr. Lachance, Mr. Carl, Mr. Lachie, yourself which has been running insofar as the bonding effort, this exhibit to see if anything written there needs to be corrected. Now the bond needs to be corrected. Okay. How do you correct it? You shouldn't be there. You're still on the board and then you see correct. But he's not employed by inertia. And he wrote on the bottom, now retired. But you will see it full and obliterated by the president. Well, so it should say former, see it calling it former, in fact. It should say retired. So with the correction of stating more clearly that Mr. Roshua would be tired, the bonding was appointed to the local board by Enbridge. The ferry was appointed to the local board by Trenton. And those three corrections, retired, Enbridge, Trenton. Is this exhibit active? No. Okay. What else is wrong? Yeah, the bar shouldn't be around that particular. Why not? He's retired. But is he still on the NNEDC board? But he doesn't have any affiliation with energy. Would you like to write next to his name on your NNEDC director's parenthesis retired? He doesn't have any affiliation anymore with energy. He is currently a director of NNEDC, correct? Correct. But he doesn't have any affiliation with what you're trying to point here. But to move is to do the six with the correction. The parenthesis after lending NNEDC's Enbridge, the parenthesis after ferry NNEDC's Trenton, the bottom line is writing Mr. Descartes as he's retired CFO in his second wife's prison of energy here in the city of L.A. Thank you. Are you looking for me? Yes, I continue to object to the admission of this. I think it's confusing. The information about who's on the board, the complete information is in the discovery responses that we've already admitted and that contains an accurate depiction of the full boards. So I object to the admission of this. And as we demonstrated through the testimony today, there are a number of errors in this. This is entirely within your discretion. It does summarize the witness's testimony. There's nothing he needs of it and hasn't said. If you think it's helpful, admit it. You can treat it just as the monster of evidence. So it doesn't have to be formally admitted. But you can use it if you see it as useful. I'm going to... Any attention that's not admitted but can you just ask more questions if you would like to respond to this? Is there a question? Other than the changes we just discussed. Is there any... And you don't have to repeat your position that Mr. Desparge shouldn't be listed. Is there any other correction that you think this needs to be accurate? To make you happy? On the exhibit, you have to... You want it for a line, right? You can do whatever you want. And cross that out to Mr. D'Amato. Just to clarify this, the exhibit is not having an evidence. So I need to ask a question on all of this. I actually think we've covered... I think we've covered the contents of it. And we did admit the discovery response which has all of the information and affiliation on it. The discovery response has much of the information but not all of it. I think it's fair to say that the visual information summarized in this exhibit has contained the testimony we just had. The discovery responses identify cross affiliations. I'm sorry, cross affiliations? Affiliations between the abstract, right? And the discovery response of the abstract that showed where there's affiliation of fine among different corporate entities. Can you ask a few questions? I'm thinking that's where you got the information. I've already stated where we got the information. Just a point of clarification. On an auditory cost number 7, which is on page 11, where the market is going to cost 8, expressly asked which entity was responsible for calling the board or the members of the board of directors and the director of the auditory cost. I'm sorry, again, I forgot which one. That's the question 7. That was specific to the director of the auditory cost. Excuse me, I have the energy. Would you have a question for which one? So, Mr. Ruman, just to clarify, there's this list of names in the bottom half that there's information after each of those list of names. You're saying all that information that's already in the discovery response. I asked the winner. No, not all that is in the discovery. I asked the winner. That was accurate by 20, so it was. But what I'm struggling with is the record that we have is not going to be in this document. So that's why it seems that if you want to thank the mission, consider that a copy. So I would go line by line for the record. Mr. Perche, is Sophie Roshu the president and CEO of Energy? Good. Good. It's Martin Bigelow, the senior vice president for development, communities, corporate affairs, and safety on Energy. Good. It's Eric Lachance, the senior vice president for regulatory, IT, and logistics and using also the CFO Chief Financial Officer about Energy. Good. Carl, the vice president for executive leadership development of Energy. Good. It's Mark Monkey, the president of Enbridge Energy Department. You say so. That's not his exact title. It's something close. Something close. I ask you if you're really sure of this. Are you the regional director of asset management at the past and the president of the vertical sport? Is my title changed? I'm sorry. What's your title now? Managing director of infrastructure in America. Managing director of infrastructure. Where are the cops? In infrastructure. Is Mr. Grunden, the vice president for treasury and tax at Enbridge and also the CFO of Enbridge income fund? Something very close. Okay. From his forward position as chief financial officer and executive vice president of Energy. From that position. From those positions. Now I'm going to approach the witness who is in charge of my laptop which is online right now and it's on the CDAR website. I'm going to ask him to plug in Energy and see what happens. Is that what's on your hand please? S-E-T-A-R is equivalent of the S-E-C website here. You'll see if there are any public documents available about Energy. I think we can confirm this without going through this exercise. So, yes. I think it's publicly available of people. That's why I'm going to give my question. Energy. Maybe we could do this on a break. Maybe we can stipulate whatever we find out. It just seems a little long. Why don't we do it on a break and then we'll stipulate it or we can have it go further? If that's okay with the triangle. We'll do it. The follow up question was especially earlier about annual reports. You have not read. The acquisition of the president is a 1.2 billion dollar acquisition correct? Correct. What? The asset, except for some differences, are the same assets. And there is differences in by now, but now that we have the same percentages of the asset. The core of the asset is energy. We own 71% of energy. The difference is my understanding when I look at their numbers is they don't have their capital structure is different and their ownership of certain assets is different than what we own through energy. The question is what is about exhibit 7 which is the discovery answers to the interveners disturbing questions. The sake of soliciting a move across 7 get the witness the the response to the the response to the intervener question. He could turn to pages 15 and 60 Question 1- Question 1- to create some documents pertaining to minutes emails, letters about communications from any of the parent companies with a live guest and your answer in the bottom of page 16 conclude notwithstanding the foregoing objections Noverco does not have the documents requested was not involved in the matters described in the request and the atoni projects of remote subsidiaries such as VGS and GMP are not part of Noverco's business and operation. Is that correct? Is that correct? Yes If you read that correctly and let me explain Noverco's business and operation is a holding company we are having an employee we manage investment And the only investment we manage is energy, correct? And the main investment we manage is energy, correct? In fact it's the energy investment As I said before we have other shares in the portfolio 100% owner of energy 100% owner of energy currently the 71% which is currently the 71% owner of energy which is effectively the 100% owner of the Northern New England Energy Corporation, correct? Incorrect Incorrect Indirect Indirect And NNEC is the 100% owner of our gas systems, correct? Correct And it's also the 100% owner of Green Mountain Power, correct? Correct If you're comfortable with submitting sworn answers to this government stage the utility projects of remote subsidiaries such as EGS and GMP are not part of the warehouse business operation Correct Because Novakol is a holding company that holds an investment in energy Novakol is an investor in energy Energy as you pointed out owns NNEC and the day-to-day management is led to energy Energy is managed by the board of directors and we don't have any implication in the day-to-day of energy What does the Novakol board have a day-to-day involvement with? Managing its investments in energy as an investor investor and owner investor and owner with energy having its own board of directors and its own management as you pointed out in the previous exhibits I would now like to discuss the three of us exhibits nine and ten attachments to the department's discovery there were attachments 5.2 and 5.3 I appreciate you having them There have been ten accurate copies of presentations by Vermont Gas to the Gas Metro Board of Directors in 2016 and 2017 Correct 9 and 10 2016 Four of the discovery answers were produced in answer to the department's request Have you ever seen this exhibit? I believe that it was at the board meeting of Gas Metro Who often does the board of Novakol meet? One to be quoted Who often does the board of Gas Metro work? Energy or One to be quoted plus one additional time So five five, six times a week Are the meetings held of the two entities? Are the meetings held on the same day or different days? No, I don't understand Was the exhibit plus ten was the document presented at a meeting of Gas Metro that you will present to My recollection yet Was this document the actual piece of paper or the digital copy of it given to any of the Novakol directors who were not present at the Gas Metro meeting? Was this document exhibit ten paper copy or digital copy ever provided to any of the directors of Novakol who are not also Gas Metro directors? Okay, but this is the first time for me so I'm going to ask if you go slowly. Could you just clearly your question There are some members of the Novakol board who are not members of the Gas Metro board energy board, correct? Correct. A member of the energy or Gas Metro board in the fall of 2016 would have received a copy of the exhibit across ten, correct? Any members of the Novakol board who were not members of the Gas Metro board ever received a paper or a digital copy of the same document? No. Because documents received at the board of directors of energy are documents that you receive as a board member and produced by energy and are for the benefit of the board of energy and not for the board, not for anything else. Information contained in across ten ever communicated to any member of the board of directors of the Novakol who is not also a director of Gas Metro married connection? You would call any discussion at any time among the Novakol directors of the Addison Natural Gas Board? This project was discussed for information purposes at the energy board where there are some members of the Novakol board. You have been on the board of the subject of the Addison Natural Gas Board ever been discussed at the Novakol Board? Not specifically. That we don't discuss the specifics of what energy is presented at energy is discussed at the board of energy. There is a very fine line between what is discussed at energy and what is discussed at Novakol. What is important for Novakol is when we have to make capital inclusion, capital contribution for the stability of energy. That's what we discussed at Novakol. Were you ever asked, was the Novakol board ever asked to make an investment in the broadcast systems while you've been on the board? The way we function the weights function at energy or energy or comes back is a sheltered space to make a capital inclusion. So a capital inclusion are rebalancing the structure of energy to maintain credit savings. Could you answer the question? What was the question? The Novakol Board ever asked to make an investment in the broadcast systems while you've been on the board? As I explained to you we make capital inclusion to maintain the structure of more energy because energy or ask us this is a time to maintain the structure of the financial credit investment in energy. I think your answer is that Novakol doesn't invest directly in the broadcast systems it adds capital to energy or extend makes the investment. Is that what you were saying? Yes. So I ask a poorly worded question. I want to try to do better. While you've been on the board at the Novakol has Novakol ever been asked to increase the capital of energy so that energy can make an investment in the broadcast system? I don't recall the significant there must be. Why must it be? Because they're supported energy are supported both do you know how to empower and burn on gas? 14, 2015, 2016 broadcast systems had rather large need per capital bit of time. Sorry could you, I didn't hear it there. 2014, 2015, 2016 broadcast systems had rather large need per capital bit of time. Which? Gas system? I'm sorry I didn't hear it. 2014, 2015, 2016 broadcast systems had a large need per capital. They had a very large project. What was that project? A decent project. And the board of America had an expansion project. So the board of America voted to provide capital of energy to provide capital to broadcast systems for the natural gas project. The board of America provided capital for energy to support this goal. Can it be yet? Can it be changed? Can it be other projects in Quebec? It's pinched together when needed between all three different funding, either debt or equity to maintain the credit rating of the financial structure of energy. So I cannot pinpoint to you specifically the accurate the state that the capital needed for the natural gas project was over $100 million. I think so. Would it be accurate to state that the board of America approved investing in energy so that the energy could provide over $100 million for the natural gas systems for the natural gas project? Did it probably provide for something, energy, the amount, I don't know exactly where did it come from? Equity. Not sure. When the board of America was considering investing tens of millions of dollars to just sit around and talk would you have any documents to look at to make those decisions? Objection. It's argumentative. I can't ask a very question. When the board of America makes a decision about investing tens of millions of dollars in energy to invest in the Vermont subsidiary does it face that decision on introduction? When the board of America makes the decision about investing tens of millions of dollars in energy to invest in the Vermont subsidiary does it face that decision on introduction? Most of the decisions are to change with respect to Vermont entity energy will make a capital call to the company and the that's cool. As I said before the intent of the capital call is to ensure the financial creating the financial energy. This is an old lawyer question, right? It was a yes or no question. I can repeat the question if you want but I am looking for a yes and no answer. The question I will repeat is the board of America makes a decision to invest tens of millions of dollars in energy to invest in the Vermont subsidiary does the board of America review any document? The board of America reviews the call form in equity injection the board of energy will review the decision for that call but the decision for investing are made to all those boards independently I would expect that the board of Vermont guys approve that and make the capital call to energy like the board of Green Mountain Power when they read the equity made the capital call to energy also. Was that a yes or was that a no? Your question is too full I'm not sure which question I should answer. Maybe if you broke it down a little bit I think he's having a hard time because it says that answers your question. Your discovery response you said America does not have the documents which was requested was not involved in the matters described in the request and the utility projects of the remote subsidiary such as VDFs and GFD are not part of America's business and operations and the requests are all documents pertaining to the NS natural gas budget you told us under oath there are no such documents they do not exist I'm asking you right now when you make a decision invest tens of millions of dollars in your subsidiary energy or to invest the Vermont subsidiary in your testimony right now you make that decision without reviewing any document. My answer to that question you've read it. The board of America will make the decision tens of millions of dollars invest in Vermont gas without reviewing any documents about the NS natural gas budget. Objection it's not what the witnesses said and by starting questions with information that the witnesses have directed to it's just confusing the witness so the witness is happy to answer questions but maybe we can break them down and not practice them with the statement that's not what the witness has applied do you mention whether it's a call from energy to the energy it's a proper letter saying we hereby request by under the energy agreement request of the shareholder or we buy the structure XY it's a three page letter it's a three page letter most of them we know the question was if there was a supporting document it does sound like it from your answer to the hearing answers question that made the decisions about whether not to invest in the energy or so energy or to invest we did review a call and the call consisted of three page letter we have a call for equity on them that we need to offer them in years and that is presented at the energy board and the explanation for that call is presented at the energy board what about the vehicle that's what depending questions are about because you said there are no such questions that the vehicle board has looked at there's a call in writing given to the vehicle board the call is in writing is given to the shareholders to the board of shareholders which means the vehicle in writing the discovery answer you gave us was not correct that's inaccurate your mischaracterizing testimony he's saying that there's a three page letter and that's what he said you're not allowed to testify under the record he testified asking questions trying to answer you want to take a break and maybe when this gets ready I don't think you need to break it do you need to ask clear simple questions do you like to take a break maybe during that break why don't we do that before we break we can break before we do we're back for a break and we're informed about the elevator it's working again it is I don't know I don't know does anyone in the room know of anyone who is having trouble getting up to the hearing room now or does it seem like everyone's been able to make it I didn't see anyone at the bottom okay thanks if anyone gets a text message or anything from someone or is aware that there's someone who wants to be in the hearing room but can't because the elevator isn't working these interrupts anyone in the back seats at that moment let us know and we will try to set up phone conference in or do whatever we can to accommodate so anyone who wants to be here but not access the third floor is able to yes and I want to start by making a correction it turns out to use the s-e-e-a-r website correctly you have to put an accent over the letter e to find energy number one I don't know how to do that on a laptop computer but if you do that you will find that energy does have reports on the website I was wrong Mr. Couchier I want to follow up on the subject we were discussing before the break which is calls for capital Mr. Duvall before you get started before you get started out do you want a sense of how much more time you need with this witness five minutes make sure that we have enough time to take the proceeding today oh yes I have very few questions for the partners in this when a subsidiary such as the linecast systems requires capital from energy what are the steps they take? that's a difficult question for me to answer because we really know where I was doing it I would guess the first step on that subsidiary would be for their board to approve for a cash flow I'm sorry for who? for investment by mission because they require an investment by mission but the board that board entities I'm assuming because I don't know the details I'm assuming that board entities will review the decision review what's required of me review the budget review everything and so it takes we need a cash flow for example can you say that board which board are you referring to? any of the subsidiaries energy for example energy will do that and we expect and that's my understanding that VGS and GMP review the decision do you have first knowledge about what energy formerly known as gas metro does in response to a request or a call from VGS or capital do you personally have first hand knowledge of what energy formerly gas metro does in response to a request or a call from VGS or capital energy will review on a daily basis what are the funds required of this operation and the operation of the subsidiaries they all will go each will provide the budget the budget will be approved by their own boards and those will come to energy and energy then looks at the funding which requires four major projects everywhere with different projects put them together do I have enough debt to fund that do I have enough equity sometimes they have all the resources they need all the financial resources they need sometimes they need to make a cash follow up so everything is bundled together and that's how we could it be a decision from the Resilient Energy to Quebec on the XYZ they look at their financial needs as in companies look at their financial needs is the answer you just gave based on your own personal experience serving it on the gas metro energy or board that's my understanding on energy or board and the other board what we call foundational question is the testimony you just gave based on your personal experience yes the board of energy is reviews on a yearly basis the budget reviews the financing energy or needs that reviews the capital project the management of energy will build the budget who will review it at the energy board and from there on the energy from that budget I will finance that or maybe because I need to maintain my ratios my different ratios for credit rating for regulatory purposes I need to make a cash call included in your response that the energy will examine the capital projects that were used so for example the natural gas project will be a capital project not at the energy board because those projects are dealt with each subsidiaries with their own governing board will be able to do their own projects and take the decision on their own projects I'm not asking you to agree that the energy board says yes or no to building a project I'm trying to find out what details the energy board has of capital projects by DGS when the energy board approves providing capital to DGS capital projects by DGS and DGS every year when the CEO and the CEO goes to their board and says this is my budget for this year those are my capital projects I'm only assuming because I haven't seen anything again I'm only assuming they bring a budget like any company they will bring a budget with all their capital projects for their board to DGS their board to DGS so you have a partial experience in the Burcos board correct so the answer you just gave us about how energy your response to capital calls was based on your personal experience serving on energy years board I give you what I assume it is because I'm not in the day-to-day operation we're holding a company or managing our investment into energy years energy will present to us like they have to do with all the different entities it's all bunched together and the project we approve part of the project incorrect which are specific to Quebec and which don't go into the rate base because everything which is in the rate base is already approved by the regularity I'm certain that you may have been answering because I'm trying to ask you questions only about how the energy your board operates it sounds to me like you've been talking about how the your board operates no I haven't been talking about I've been talking about energy so your answer is that you just gave we're justified energy Mr. McLean did you want to say something I think if you want to read back his answers if you're confused but he was talking about what he assumes happens on other boards as well so it's not just his experience on the energy board if you want to get clarity I think we can ask simple questions if you want to clarify I'll let you take over I thought you were asking for clarity I think the transcript will reflect so now I want to ask you about the process at the numerical board when you receive a call from capital what's the process what documents do you look at do you obtain information verbally from board members or from staff how do you respond tell me what the process is the process is we sit on the board of energy the energy has to be signed if it does a capital call to both the children we review the requirement of the capital call at the energy level and after that there may be some question we have some people within our organization that will call them and say okay what is the rational what is the basis generally the purpose is to balance the financing structure of those of the energy and some of the board members as we pointed out sit on those before launch break you referred to I believe it was a three-page document that you associate with a a call from energy or to a vertical for capital what is that document it's a simple document under the shelter of energy or LP per section x, y, z whereby again you notice you have to make a capital call for x, y, z it's one page, two pages so a capital call for x, y, z what's an example of what x, y, z might be we need to rebalance the different ratios and the structure I don't recall exactly the language we haven't seen one for quite some time but correct me if I've got this wrong what I'm understanding from your testimony today is that energy formerly known as gas metro does the evaluation of the details of the capital call at the vertical level it's very generalized to receive very few details is that right we as every time there's a capital call energy we ask the question what's the reason for the capital call why are you why are you making a capital call okay fine we need to rebalance the structure in general it's because of rebalance and the structure and after that we may have an analysis we may have a sharp talk in this before understanding exactly what are the ratios that needs to be rebalanced we ask questions and the capital call is submitted to the board of energy for them to send to their show before it can be sent to the show the board of engineers to agree my question was about what happens at the vertical level and your answer is referred to I think what happens at the energy or board level is that right so at the energy or levels we do receive the call we know about the call I sit in the energy area that's the fact we have a small discussion about it at the board we our team as I said talk to the finance team of energy here we look at the specifics of why you need to rebalance think about that is that an issue of credit is that an issue with the rating agencies what's the issue can we is there any way to what's the best way to do it when you fold it just for purposes of clarity you said we have a small discussion about it when you said we have a small discussion about it we had the no-burcal board where? thank you that's all here that's the question you are referring to doing the ratio rebalancing is there any consideration of specific projects as a part of that it's difficult to say a specific project because those projects go into the financing and I'm telling you exactly which one are there there may be projects at energy but I'll go back to what's key here is that decision for Vermont or maybe Vermont by the boards with the management which are there after that what's elevated is the funding of the decision of the decisions made down here and those all funding when you accept the funding of everybody within the organization of the different subsidiaries put them together and say this year I don't think from the next year I've got too much there then rebalancing is it for one particular project it could be for many different projects or because they have too much there I cannot say I wouldn't say for projects it's for projects in Quebec but probably for investment requirements in Vermont because at the energy board we don't decide the Vermont entities decide and take the decision on their projects you wouldn't provide advice or whether a project should proceed it's limited to how it should be funded is that a fair characterization the decision to proceed with the project is made by each of the organizations below New America and would New America have some say in that no, that each entities have their own boards have their own governance our majority with independent members from the energy board as I stated in my response and take their own decision for this project does the department have any I'm sorry just before we pass it on to make sure I know that in the state of the record what exhibits it I know we've given a ruling in being 5, 8, 9, 10, 9 did 7 come in? 7 ok, so 7 gave me a believe on exhibits 1 through 4 there was a training that didn't move to admit those we delayed a ruling on those while you asked questions so I just want to make sure are you moving to to make sure that it's 1 4 was admitted without objection I mean 1, 2, 4 they did I I'm fine with I'm fine with admitting the shareholders the exhibit plus 4 that's fine the other ones there were no questions about the other ones because the witness wasn't familiar with those I don't see any reason to 1 through 3 that weren't the subject of any testimony I think I tend to agree with this I don't know if you can establish relevance and foundation correctly and not present to what was said and read though I think the documents may be useful to the commission hearing officer certainly the kinds of documents the commission put on its own tame evaluate and just get noticed in parties because the public documents is the Canadian equivalent of an SEC file they satisfy the board's rule I don't think it's critical in the way I think it's useful to have everybody available I don't think it hurts and I think it the documents contain a fair amount of information about the Vermont activities of the year and that's what I was going to go through with the witness to discuss I might add if I could that I think that the record is already complicated a bit by some of these issues that aren't directly relevant and so I'm not sure that having these very lengthy reports is going to advance any of the issues of consequence here I could just give you an example sorry I was just going to say for example if you look at the 2018 annual report it mentions Vermont 81 times the maps of distribution systems in Vermont they disclose how much income gas metro is getting from the Vermont subsidiaries it shows the importance of Vermont subsidiaries to gas metro that's what I want the developments to do there's not a well I'll let you decide I know that you were in the middle of talking about it could I just ask one clarifying question because it was at the very end of the testimony just of the witness was it your testimony that you have not read any of these three documents the cross one, cross two cross I think my answer was yes let me explain why but in our own 29% we own 71% and we sit at the board we know the 100% we sit at the board on the 100% I don't sit at the board of by and after we review those documents I'm not part of the other committee of by and after we review those documents so we have a very good understanding of the underlying part of the underlying asset because Valena has something which are different than you know back home in terms of Valena they have difference in ownership in assets but do I look at that on a regular basis is it my job to look at that on a regular basis this is Valena and this is Valena's board to review those documents we as order of 71% of energy we know very well part of the business which is also owned by but you have not read these specifically those three I don't read the report of Valena on a regular basis let's take a look thank you do not tradition notice and cross exhibit four is and we have some cross imagination question about the capital structure of energy and the very specific areas of energy to get closer I'm sorry I can hear you but I'm worried about my apologies Mr. crochet do you know approximately the total assets that energy are in dollars as a Canadian seven seven seven so when one of the Vermont subsidiary companies let's take Vermont Gas we've been talking about Vermont Gas let's assume going forward Vermont Gas wants to complete a new hundred million dollars project to be funded through a mix of debt and equity and BGS will take the debt out from its own and their capital structure is subject to review by our PC so the equity portion of that if they needed funding from their shareholder they would initially make a request to NNEC correct so any NNEC they would they would effectively bundle that $50 million capital request with the other subsidiaries that are under NNEC whether it be GMP or the solar company and then that would go up to Energear and so Energear would then bundle that $50 million into the broader pool of investments that it has in Quebec and then that would potentially be the subject of a capital call if A and NNEC doesn't have access to debt to fund up B with Energear has access to debt and if all those steps after taking R they request funding they will go to the shareholder to fund it and you referred to various ratios and rebalancing is that typically balancing debt and equity to maintain appropriate public ratios or is it broader than that equity and regulatory ratios and so and now let's assume on a hypothetical situation there were some emergency that happened with one of the entities controlled by Energear whether it's a natural disaster or something that requires an unexpected large infusion of capital and that request is made up through a capital call to at that point in time with NNEC there's an unusual request for capital if it's an emergency we expect Energear to be able to tap on their revolving facility and their facility for that emergency and what for that? to tap on their revolving created facilities for situations like that and other situations so that would be the first and after that it would be a rebalance and two-time and when capital calls come in do you have a feel for the scale of the dollars requested are we talking $10 million or are we talking $100 million $200 million I think those are all the questions I have we have a couple of questions about the Valoneer decision in America to purchase Valoneer came without and why so you can tell us just some background on that sure on a regular basis we review and we Energear we review the strategy plan how to achieve the strategy plan and we have discussions with our partners and so on and some of the opportunities I was going to show my discovery or testimony some of the potential acquisitions of Energear we like to potentially look at local distribution companies in other states in Canada are pretty substantial in terms of investments and that was always a bit of an issue Valoneer was just a bit of an issue how Valoneer could fund their own portion of the potential so for that reason at some point how are we going to deal how are we going to best position Energear how can we best position Energear to be able to grow and making large investments in the future and understanding that Valoneer limited Valoneer ability because of its small capitalization to fund potential investment as an equity owner would be an issue we've decided to and we made a proposal to Valoneer how do we so you said small capitalization can you explain what you mean by that Valoneer has market capital he's 1.2 billion and that's the transaction as Mr. Duval Valoneer have to go and draw if you take for example the LBC would be $3,000,000, $4,000 half of it funded by equity I'm just making numbers here half of it by debt so $4,000,000,000 by debt so $2,000,000 but now we have to fund 30% of that which is $6,000,000 when you have a market cap of 1.2 billion raising $6,000,000 would be difficult we've been talking about funding large investments in the future are you talking about entirely new entities or are you including entirely new entities not additional investments in the VJSNG additional investments to VJSNG unless VJSNG and GMP come with a huge project which I'm not aware of has the proposed acquisition been approved by the Valoneer shareholders can you give us a status on that yes the proposed acquisition has been approved at a special board of Valoneer two held on June 11 which has been approved by the court in Quebec the other approval that were required was FERC which has been approved also so yes this transaction has been approved by the majority of the shareholders of Valoneer by the majority of the shareholders of Valoneer the court approved arrangement in Quebec in your initial testimony so the transaction will occur either in one step or two depending upon the approval of the common and preferred Valoneer shareholders so is it now on one step and has that one step been completed both steps have been completed at the same time both the regular shareholders and the preferred shareholders of the board of the transaction due to your May 2nd testimony at the top of page 3 you're referring to the change in the indirect ownership interest and you have that the test will go from 28.09% to 39.56% and end bridge from 27.61% to 38.89% and in energy GMP and BGS my question is that the 38.89% for end bridge how and then plus the 39% for the test is there another entity that is missing from that calculation is there another entity that is missing from that calculation yes those are indirect percentages if you look at my testimony just before page 17 page 2 trend type LP is majority owned by CDPQ at 64.74% so the remaining is 10,000 100% who are they British Columbia investment fund which is the pension fund of British Columbia the pension fund is union workers which have been there for 10 years and more both of them have been there for 10 years and more which is called FSTQ FSTQ FSTQ FSTQ FSTQ FSTQ FSTQ FSTQ FSTQ FSTQ and the last one is the retirement fund of University of Quebec University of Quebec and this is if I'm correct public information which is on the website of the engineer but the majority of FSTQ 64.74% is owned by CDPQ CDPQ CDPQ investment fund and as a practical matter that entity CDPQ is the entity that's appointing all of the test seats on the energy board because it is a general partner of TRENCAP so it controls TRENCAP the other investors are acid and therefore we have points to remember of TRENCAP on the board of are those passive investors or are there entities to the test? It sounded like what you said about the pension but I just wanted to confirm to understand the pension funds the case is not a pension fund it's a pension fund manager so the case is manager the others are really pension funds the pension fund of the union the pension fund to check for PCNMC British Columbian investment corporations they are managing funds for different the power of fund managers I want to interrupt just to point out look at page number one of the exhibit it's not in evidence it's in across two there's a diagram that helps explain the system don't do this I'm agreeing with witness and saying it's a question it's a question it's page number one but it's actually the one to fourth page and it's also adorable last time I checked on the energy one such thing it's the fourth page but it's the number of pages number three number one that's the same basically the same this time number number number please double this the one of those and the only three Do you envision any scenarios where that could change the 6-3 division? I don't see today that this could change. Remember, this is a transaction which was led by KS. It doesn't change the percentage of board seat and bridge and the board of control or the ownership of the bridge inside of our pool. So we have one-third of the board seat. We'll have one-third after that of the board seat under at energy here, 3 divided by 9, which is one-third. So that is the same, exactly the same thing. There is no plan, nothing that could change. This transaction was led. It's not proposed by Enbridge. It's not an Enbridge transaction. It was led by KS in order to help. To solve an issue we had for potential goals at energy here in terms of funding for goals at energy. And continuing on supporting the goals of remote entities. So we're struggling a little with the numbers, I guess, though, because Enbridge is entitled to a proportionate share of appointments, correct? Correct. And it's not one-third, it's 38.89% after the transaction, if this transaction is approved, right? Enbridge only 3, 8% of Nogako right now. So when I plug 38.89% times 9, I think it comes out to 3.5001. It's just, fairly if you were to round the direction of a round, would it seem to give Enbridge four seats? Am I doing the math wrong or is there another document? No, you're not doing the math wrong, it's not important because Enbridge is a minority, or stay a minority, and they have no control over the board decisions of either at the Nogako level, as I stated in my response to discovery, nor at the board level of Nogako, nor at the board level of Enbridge. But it is possible they would have four of the nine seats? It's possible that they would have four, and right now they don't have it, I don't recall when they had four, or I don't understand it. Well, but Valinor has kept them from having had four seats, correct? Because their proportion currently, if they're at a 28%, which is then they couldn't have four of the nine seats. I haven't made the math, I don't see why Enbridge would increase because that doesn't give them more control. Because it would still be five more seats? Because it would still be a majority, if you go back to the point you have, and you read this morning, since we have the majority trained up as a majority of Nogako, as a majority of Nogako. And that will go down also to Enbridge. Yes, I don't think anyone's questioning the majority question. I think it's just how much of the minority that we're trying to figure out would be there, and if this transaction is approved. Maybe it would help to go to page three of your June 7 testimony. And question four is about make up of energy or board before and after the acquisition. And that's what we've been talking about. And the last sentence says, in the event that the size of the board further changes following the acquisition, the nomination rights have passed through Trencap LP and Enbridge, throughout the ecosystem, and through their folding of shares at the American level. So that proportion would be that 38.89 per seconds after the transaction, if the transaction is approved. And what remain as is right now, the only 38% will continue to be 100%. And the nomination right, as you pointed out, is the rounded, if I'm correct, 3.50. But that, I haven't seen any change from Enbridge to increase the number of board members, and the six will be appointed by GANS and three will be appointed by Enbridge. But there were a change, let's say I went to a seven person board, then it would be these percentages used, and that would be four chosen by the cast of three by Enbridge, right? I have amazing calculations, so. Okay, does that sound right for a seven person? I know six would be, but it doesn't change the control, the control of the majority, it's still going to be that. And who decides to change the size of the board who would make that, would propose that decision and would make that decision? I think that we should cut the number of board. An energy or board, would the energy or board could it propose to change the number of board members who didn't have this? Or would it verify that? I'm sorry, I can't hear you now. Sorry, I'm wondering who has the authority to request and to approve of a change in the number of energy or board members? That's a good question. I may have to ask the company to look at the steps to change that, but I'll reassure the commission that as long as we have the majority on issue, and we will continue to have, as of today, we have majority on issue at the level that will be the same at the energy level and that will enable us to name the majority of the board members at the energy level. Just to clarify, you said 38.89 percent is what it is now. 38.89 percent is what ended its own through IPL in your record. You, in your testimony, stated that the acquisition does not result in a fundamental change to upstream ownership. Do you recall that or do you have a few to share? I recall none. We have a better understanding of fundamental change. Would you describe what you would consider to be a fundamental change? Fundamental change. Upstream ownership. Upstream ownership. It's here. Novak always already in order of sitting on 1 percent of energy here, and we're providing 29 percent. We already have the control of the GP of energy here because we own 100 percent of them. And adding 29 percent is important, but it's not a fundamental change. If we were, let's say, doing, if we were at 51 percent and we wanted to buy 49 percent, that would be a substantial change. So it's purely based on the numbers and whether it's majority? We already have majority. So we're adding to that majority. We're increasing that majority. We're not changing control. And that has been working and used for the last more than two years. Just turning to another topic on your May 2 testimony. A question for the answer for end of that first paragraph here. For a prior testimony, you say, GMP and BGS as long as we manage, have always been managed independently of all their upstream owners, including the Navarro Enbridge trend cap and CAS, that too will continue following the closing of this transaction. I'm just wondering if that is documented in any corporate documents about how the entities interact with each other. How does the Navarro Enbridge trend cap and the CAS influence how GMP and BGS make decisions? I think it goes back to governance. And I want to spend a bit of time on governance. The way we manage energy is truly our participation of the Board of Energy. We don't direct energy to DXYZ. Energy has its own board and the board with the recommendation of management will take decision and will support management. The main decision that Board takes is succession planning and approve or advise on the strategy of planning. After that, potential acquisition and that percolates. Percolates is the right word in English, but that goes down to the subsidiaries where each subsidiaries have their own board in terms I'm sure it's in the statutes and they're managing dependency their CEO will report to them. Yes, there may be discussion or exchange of information because ultimately energy needs to consolidate all the financial statements to Jews and DNAs to Jews financial statements and within their discussion. But the decision making is made at all the subsidiary levels in terms of decision making. So to answer your question is there a specific document I'm not sure I would have to look at all the statutes start with the statute of energy which I'm not familiar, I don't look at those statutes or report sometimes and I don't know about the statute of BGS and GMP, but they're regulated entities so decision making I'm sure has to be done at those entities. It's the same way we manage other investments where the minority shareholder or the majority shareholder typically those boards have decision making powers which are not to the shareholder they take the decision making they make the decision upon the recommendation of the management. And just to clarify when you're talking about the statutes suddenly if you're talking about the... Bylaws. I'll clarify I guess I would request if you have those available that our vote could point us to something that has that in the bylaws of the corporate energy and the corporate energy and also give us more information if you have it on the question asked earlier who can request a change to articles of how many board members are on that energy board five minutes to take a look at my notes and if I have any redirect it won't be extensive. Yes, I have just a few follow up questions Mr. Foshay do you know if the bylaws for the boards of Hermite Gas and Green Mountain Power have a specific requirement regarding whether the board members are independent from upstream owners? No, I don't know because I've never seen those bylaws but the philosophy of the investments is too much energy it's too out of the chain here is that they have independent board members majority of the board members I want to go back to your May second supplemental testimony do you have that in front of you? Sure and refer you back to we're on page three lines 12 and 14 do you see there where you refer you state as I noted in my prior testimony GMP and BGS have always been managed independently from all upstream owners I'm sorry upstream upstream owners can you explain to us what you meant in that since they're about managing independently? Yeah, sure my understanding it's the same that we were doing at Energy is that the board governs the company the company is governed by the board and the management the operations done to the management so we don't direct the management we're not implicated in the decision thinking directly with the management the management decision process goes to the board I would expect the same to be applicable to each of those entities and that's the answer I want to talk a little bit more about some questions you got from the hearing officer on page three and starting on page two of your supplemental testimony where we are the May 2nd testimony currently how much of Noverco is owned by the Enbridge entity? 38.9% and how much of Noverco is owned by the CAS entity? CAS Frank Cap owns 61.9% and Trent Cap is controlled by and if we add the 38.89% and the 61.11% that's 100% correct? and after the acquisition if it's approved here what will Enbridge's percentage in Noverco be? the same 38.89% and what will the CAS ownership interest in Noverco be after the acquisition? the same 61.9% to Trent Cap now can you Trent Cap can you take a look specifically on page three of your May 2nd testimony? true do you see lines two through four your testimony indicates that referring to the acquisition that this will in turn increase the overall indirect interest of the CAS from 28.09% to 39.56% do you see where I am? yes can you explain how you calculated that 39.56% 39.56% yes 39.56% is equal to 64.74% which is the ownership of the subsidiary of CAS in tank cap times 61.11% which is Trent Cap ownership in Noverco if you multiply those two numbers I'm pretty sure those numbers just so it's clear here those numbers that you're referring to 61.11% and 64.74% are those on page two of your testimony? correct just to those issues go to the numbers on page two relate to ownership of Noverco before and after on page three relate to the before and after effect on Energear, LP, GMP and VGS the effect on Energear, GMP and VGS after Valoneer goes away is that the percentage increases it's the indirect ownership so if you're buying Valoneer Noverco buys Valoneer so Noverco goes from 71% so those numbers grow in terms of the impact on GMP and Energear the GMP and VGS are always being owned by NMJ 100% but the percentage that Trent Cap and IPL systems own or the cast and Enbridge own Energear grows through Noverco because Noverco goes from 71% to 100% but in Noverco nothing changes in Noverco the shareholder agreement doesn't change Enbridge doesn't have control over the board of NMJ Enbridge doesn't have the majority of the board members nothing changes there we have one-third of the board members will continue to have one-third of the board members no further questions thank you I don't move we don't need a break before the department so the department is now going to call Mr. C. V. Herold and Mr. Leonard J. Kujawa who filed joint panel testimony in this case you can call one of those chairs Mr. Herold we'll use your how bad do you swear or if you're under penalty of perjury that the testimony you're about to give will be the truth, the whole truth and then nothing but the truth Mr. Herold and Mr. Kujawa can we try and do you have copies of your pre-file testimony and the exhibits which are marked as PSD-CVH1 and PSD-LJK-2 up with you yeah and it says PSD-CVH1 PSD-LJK-2 up with you and is there any need to revise or edit or correct any portions of that testimony or exhibits and we spoke about this previously but I want to remind you when you're here as a joint panel if one of you responds to a question if the other one disagrees or if you disagree with what your partner said you have an obligation to let everyone know that you disagree with your partner's response we understand that and so Mr. Herold and Mr. Kujawa good afternoon good afternoon could you please share with us the documents you reviewed and preparing your pre-file testimony we reviewed all the file documents and proceedings so most important to us were the original petition of the medical and the testimony of Mr. Kujawa and the supplement to that we also reviewed the additional filings that were made by the inner leaders as well filings meeting the motion to intervene yes the discovery that's just provided by America did you rely on those to preparing your pre-file testimony I don't recall that this reliance in that particular document I think the most important was the petition by Mr. Herold in transaction they planned to make the one approval to make so what research went into arriving at Europe Indians to elaborate on Mr. Kujawa's answer we read all of these filings so we could make sure we had an understanding of the transaction and what questions were being raised what was your last question well to be blunt with you I'm wondering if what you basically did was say hey with we were on the commission this is what we would decide or did you go beyond that next we could pair some expert analysis we read then we studied it we thought about it we talked to each other we had discussions with the staff here to make sure we understood the issues and then we relied on the fact that we've been in this business for 50 years or more and have a good understanding of corporate governments and what is appropriate practice and so our conclusion was based on all of our basically knowledge as well as reading and understanding this transaction you say you've been in this business for a long time what do you mean by this business well we've both worked in a regulated industry business of utilities as well as other corporate government questions corporations so we have a general understanding of what's normal acceptable business practices neither of you have mentioned reading the board's order in 2007 do you have an order on referring to the board to order of 2007 I don't know what you're referring to did you ask any questions do any research on the analysis the commission formally owns the board went through in deciding to allow gas metro for the new england energy conversion to acquire green power no we didn't accept it the fact that they owned the company and they were moving forward and they proposed transaction we didn't go back and say what happened to create where they were today do you know what the principal reason was that was articulated by the board why they approved of the acquisition of green mountain power by gas metro in its cities no no I what is green mountain powers credit reading now Jack I think that question has been asked about the testimony if you read the board's order from 2007 you would say it's directly relevant I'm not aware of it we had to roll out the objection before I'm sorry it's okay so we'll allow the witness to answer the question and provide Mr. Heman that we have to stay within the scope of this meeting yes and for the sake of the record and commission I'm referring to findings in fact 18 18 and 20 what's the date of the order you're talking about March 26th 2007 2012 so the answer was you're not aware of the credit that's correct thank you they have page 9 of your prefiled testimony question 11 answer 11 you refer to how the transaction is approved it could potentially provide capital more quickly can you explain that a little more the critical resources of a company for us is capital and the reliability of capital is critical to their long term success so having that capability is essential for corporations success there are times when markets are open and something happens and they're closed so it's very important to meet financing to be ready and to go when you need it from the markets open because at times events occur and capital is not very easily obtained so having the ability to have your house in order so we can move quickly can be very helpful to connect the dots for me of how the approval of this transaction which would eliminate balance or would allow I guess it's energy or to move more quickly or GMP or BGS to move more quickly in obtaining capital yes sir what happens when you're doing any kind of financing all the owners will be required to sign documents and approve it and so there will be more players that are the longer generally tax so it's for the leaner leaner teams so they can move more quickly explained by the previous witness around there was a much smaller entity in relation to the ownership of the energy area let's say source of imitation of how energy could be seen in terms of financing so getting Bell in error to move along and be part of the entity facilitated the ability of energy to finance and also of course the simplification of the proper structure of having multiple energies sometimes you have to have multiple energies but sometimes it's smarter to reduce the size in order to simplify and to expedite building corporations to make decisions in your opinion do you think there's any benefit to having Bell in there as another set of eyes on a request for capital that will be rather than I think obviously a set of eyes always potentially has value and whether Bell in there specifically added value Bell in there is basically a passive investment to understand their corporate purpose so they offer very little in terms of insight into energy markets where energy was operating so I don't think Bell in there was an ideal partner to have in terms of offering knowledge capital to energy error from the standpoint of corporate governance if the commission approves this transaction it is expected that the board makeup would be 6-3 and if that makeup were to change to 5-4 in your opinion are there any issues associated with that to see any issues other than there would have to be some reason to change to 5-4 because 6-3 represents a rough approximation of ownership which seems to be equitable in a fair way to do that I think it's based on grounding was what we established earlier right so it's like 30 39% one 61% with the other so it's kind of roughly 6-3 but if it were 5-4 there would still be a 5 voted one way in control yes to go from 3-4 it doesn't accomplish much in terms of control certainly it represents ownership that means you own more in terms of corporate governance I'm not sure that makes that much difference the decision of the 5 is going to be the decision of the 4 to complain for what you have some follow up I wish to follow up on general counsel's questions about it I wish to follow up on general counsel's questions about another set of eyes Mr. Harold I have a question for you do you have a fair amount of experience with Sarbanes-Oxley I have worked with it would it be fair to say that one of the goals of Sarbanes-Oxley is exactly what general counsel said to make sure we have more sets of eyes looking at what goes on within corporations well certainly that would that would be one of the thoughts behind it to make sure that entities had appropriate controls and had someone independent to look at those controls and verify that they exist and there's always similar reasonable people and are trained to some benefit to another pair of eyes so I don't think our answer was to say that that wasn't appropriate we were saying we thought the value of getting to be a more efficient organization and we didn't want to set that you should follow up on that answer if I might you were intimately connected with a Southern company for 18 years correct I actually worked for Southern about 28 29 I lost a count and since then since I retired I have the Southern company is publicly owned is it not oh yes sir it's one of the last common held stocks in the country of course the shareholders are it's many many subsidiaries does it not I'm sorry I didn't quite understand Southern company is a holding company for many other subsidiary companies correct yes sir there's a number of subsidiaries about 20 electric companies they don't I don't think there's that many it's principally about 5 electric operating companies in recent times they also bought the gas company which operates gas operations up through the mid Midwest and they recently acquired a company called power security which is micro bridge and back up generation battery storage have you noticed any problem that its subsidiary corporations have experienced in access to capital because the parent company is publicly held and is accountable to shareholders not quite sure how to answer how have I noticed there's always a possibility but the way Southern's organized the equity has raised the parent and each operating company is responsible for its own debt that's done for legal reasons since the state regulated we want to be sure that each state had approved the issuance of the debt Mr. Kajawa I have a similar set of questions here involving the E word E word Arthur Anderson for a long time were you not sir you were working with Arthur Anderson when they were the accountants for Enron yes do you think an additional or more public set of eyes would be the assistance of protecting the public in that situation Enron I'm not sure I understand the question Enron was publicly owned was it not sir but in hindsight it turned out that the board was not paying enough detail to what was going on within the area is correct it's time to call it back the management was hiding things from the board the board was not fully informed it worked the principal problems those of its subsidiary companies the hidden events were very subsidiaries yes I just have one quick readout sorry to turn that off I turned mine on either and I just realized sorry to focus on the back Mr. Dimont's initial question to you or one of his initial questions to you related to Green Mountain Power current credit rating I lodged an injunction he rephrased the question a little bit it's correct that you were not asked in any point in time to review the credit ratings of either VGS or Green Mountain Power as a part of your review and its proceeding review that's correct but can you speak generally how a transaction of this type at the parent level could potentially affect the credit ratings of either GMP or VGS depending on the financial condition of the parties it could either help or hurt in this case it appears that it certainly would not hurt for them to die out whenever I'm saying that Newarko has adequate resources certainly the current corporations are appropriately funded so I don't think there would be any issue with the credit rating that's all I have thank you your excuse I believe that's all the witnesses and in the scheduling order the briefs were set as we do on August 2nd and we did not have the date for reply briefs so if the August 2nd date holds reply briefs typically we have them do one week later August 9th Mr. Dumont we'll make it work I just wanted to note that the department's testimony the witnesses stated that the department intended to respond to the concern was raised by public commenters in more detail in its legal briefing is that still the case? yes you still need to do that I believe a couple more comments can be made actually so any comments that come in anything you're reading those comments are important folks didn't hear that please repeat that yes we will respond and address issues that have been raised in public comments in the legal briefing including any comments that are filed between now and the day and we asked for Nivergo to provide some additional information is that clear what is needed and do we need to restate that just related to the files and the information I think was that whether there was a change the number of board seats on the energy and who would decide that whether there could be and who would decide that so we're going to find that out yeah we're going to find that out and submit information I think the second request related to the bylaws which I think clarified that that he doesn't know whether what those bylaws state with respect to independent ownership we can still I think I don't know if that's still a standing request and if so I guess we can inquire as to how we would how we can get bylaws and from which entities but I think that if we want to look at all the bylaws we can certainly submit you know so bylaws for it would be any bylaws in any of the entities that codify what has been presented in the testimony about the independence of the subsidiaries in particular GFB and BGS if I could ask that those be filed sufficiently based on the briefing dates so that we all have access to them this Friday could you provide those at the end of this week we will do our very best to do it at the end of the week thank you and also just to mention hearing officer the PD mentioned the public comments and the department talked about that as well and we really appreciate all the people who are able to show up at this proceeding and we appreciate all the comments that have been filed and encourage people to continue to file comments if you wish obviously the sooner the better and if anyone has questions about how to file those in the EVUC system our clerk's office is happy to help you with that also just to let you know that I have decided not to try to use the depositions I think I'll get straight forward to that position because it should have been addressed officially already is there anything else that we need to discuss today I don't have anything we are adjourned thank you thank you thank you