Amendment To Service Agreement
Exhibit
10(a)7
Amendment
To
The
parties hereto do hereby stipulate and agree to that the SERVICE AGREEMENT
entered into by and between them under date of April 1, 1963, and as
heretofore amended on January 1, 1972,
April 27, 1984,
August 1, 1988,
January 28,
1991, January
1, 1992, January 1, 1996,
January 1,
1998, January
1, 1999, January 1, 2000,
January 1,
2001, April 1,
2002, January
1, 2003, August
1, 2003, March
1, 2004 and January 1, 2008 be
and the same hereby is further amended by substituting for the Supplement to
Exhibit II to the SERVICE AGREEMENT, the attached revised Supplement to Exhibit
II. This Amendment is made and entered into as of June 1,
2009.
ENTERGY SERVICES, INC.
By /s/ Xxxxxxxx X. Xxxxxxx,
Xx.
Senior Vice President and Chief
Accounting Officer
ENTERGY CORPORATION
By /s/ Xxxxxxx
Xxxxx
President and Chief Executive
Officer
ESI
ALLOCATION
FORMULAE FOR
GROUPS
OF CLIENT COMPANIES
Note: Each
allocation formula will be based on data relevant to participating Client
Companies to whom the services are provided.
263 - SECTION 263A TAX
BENEFITS
Based on
Section 263A tax benefits for each Legal Entity.
Used for
the allocation of costs associated with tax administration, planning, and
support related to Section 263A tax benefits.
ALO - ASSET
LOCATIONS
Based on
the number of asset locations at period end.
Used for
the allocation of costs associated with the fixed asset accounting
function.
APT - ACCOUNTS PAYABLE
TRANSACTIONS
Based on
a twelve-month number of accounts payable transactions processed.
Used for
the allocation of costs associated with the support of the accounts payable
function.
ARI - ACCOUNTS RECEIVABLE
INVOICES
Based on
a twelve-month number of accounts receivable transactions
processed.
Used for
the allocation of costs associated with the support of the accounts receivable
function.
AST - TOTAL
ASSETS
Based on
total assets at period end.
Used
primarily to allocate costs associated with the oversight and safeguarding of
corporate assets. This would include services provided by financial
management and certain finance functions, among others. Also used
when the services provided are driven by the relative size and complexity of the
System Companies and there is no functional relationship between the services
and any other available allocation formula.
BNK - BANK
ACCOUNTS
Based on
the number of bank accounts at period end.
Used for
the allocation of costs associated with daily cash management
activities.
CAL - NUMBER OF CALLS –
CUSTOMER SERVICE CENTERS
Based on
a twenty-four month average of customer calls for each Legal
Entity.
Used for
the allocation of costs associated with the administration and support of
Entergy’s Customer Service Centers.
CAP - SYSTEM CAPACITY
(NON-NUCLEAR)
Based on
the power level, in kilowatts, that could be achieved if all non-nuclear
generating units were operating at maximum capability
simultaneously.
Used
primarily for the allocation of costs associated with the support of the fossil
operations of the System. This would include services provided by
plant support, environmental and purchasing.
CEA -
CAPITAL EXPENDITURE AUTHORIZATIONS
Based on
a twelve-month average of outstanding Capital Expenditure Authorizations and
Storm Job Orders.
Used for
the allocation of costs associated with the capital project costing accounting
function.
CHK -
PAYCHECKS
Based on
the number of paychecks issued at each Legal Entity at period end.
Used for
the allocation of costs associated with the processing of payroll.
CLM - OPEN WORKERS’
COMPENSATION CLAIMS
Based on
the number of open claims for each Legal Entity.
Used for
the allocation of costs associated with managing workers’ compensation claims
processes and budgets.
COL - COAL CONSUMPTION
Based on
the quantity of tons of coal delivered for a twelve-month period to each coal
plant within the Entergy System.
Used for
the allocation of costs associated with services in support of coal purchased
for coal generating units.
CUS -
CUSTOMERS
Based on
a twelve-month average of residential, commercial, industrial, government, and
municipal general business electric and gas customers.
Used
primarily for the allocation of costs associated with the support of customer
based services. Would include customer service and support,
marketing, economic forecasts, environmental services, financial and regulatory
analyses and customer information systems.
DLM - DISTRIBUTION LINE
MILES
Based on
the number of miles of distribution lines of 34.5kv or less.
Used
primarily for the allocation of costs associated with project design,
maintenance and installation of Entergy distribution lines.
EMP -
EMPLOYEES
Based on
the number of full-time employees at period end.
Used
primarily for the allocation of costs associated with the support of
employee-based services. Would include administration of employee
benefits programs, employee communications, employee training, and various
facilities-based benefits and information technology desktop
support.
FBR -
FIBER
Based on
capacity and use of the Entergy System’s fiber optic network.
Used
primarily for the allocation of fiber optic operations and maintenance
expenses.
GAS - GAS
CONSUMPTION
Based on
the volume of natural gas consumed annually by all gas fired generating units
within the Entergy System.
Used for
the allocation of costs associated with services in support of gas purchased for
generation units.
GCE - SERVER AND MAINFRAME
USAGE COMPOSITE
Based on
the use of historical expenditures.
Used
primarily for the allocation of costs associated with mainframe, unix servers
and related database administration.
GLT - GENERAL LEDGER
TRANSACTIONS
Based on
the number of general ledger transactions for the period.
Used
primarily for the allocation of costs associated with general ledger activities,
including related information systems, and for general accounting
activities.
GWH - ENERGY
SALES
Based on
total kilowatt-hours of energy sold to consumers.
Used
primarily for the allocation of costs associated with the financial analyses of
sales and related items.
HUR – STORM
COSTS
Based on
estimated gross storm recovery costs for Hurricanes Xxxxxxx &
Xxxx.
Used
primarily for the allocation of costs associated with the analysis, reporting
and filings related to losses in connection with Hurricanes Xxxxxxx &
Xxxx.
ITS - TOTAL IT
SPEND
Based on
the total dollars spent in the Information Technology plan.
Used for
the allocation of costs associated with the administration and support of
Entergy’s IT business planning.
LVS - LEVEL OF ESI
SERVICE
Based on
ESI total xxxxxxxx to each System company, excluding corporate
overhead. Used for the allocation of costs associated with support of
ESI as a legal entity.
The
variation of this cost driver, Labor Dollars Billed, is based on ESI total labor
dollars billed to each System company. Used primarily to allocate the
costs associated with employee benefit plans, payroll taxes, department indirect
costs, and performance based compensation plans for ESI employees.
ITR - SUPPLY CHAIN –
Inventory Management Fossil, Transmission & Distribution Issues, Transfers
& Returns
Based on
the number of issues, transfer & return transactions for each Legal Entity
at period end.
Used for
the allocation of costs associated with the management and operations of
investment recovery, including Fossil, but excluding Nuclear.
MGA - MANAGED
ACCOUNTS
Based on
the number of industrial and commercial managed accounts.
Used for
the allocation of costs associated with the maintenance of Entergy’s industrial
and commercial customer accounts.
NST - NUCLEAR
SITES
Based on
the number of nuclear sites managed and operated by each Entergy System
Company.
Used to
allocate miscellaneous nuclear-related services.
NUT - NUCLEAR
UNITS
Based on
the number of nuclear units managed and operated by each Entergy System
Company.
Used
primarily to allocate nuclear fuel-related services.
PC – PERSONAL
COMPUTERS
Based on
the number of PC’s within each Legal Entity at period end.
Used for
the allocation of costs associated with maintenance and support of
PC’s
PLL - PROPERTY AND LIABILITY
PAID LOSSES
Based on
a five-year annual average of the property and liability losses paid by the
system companies.
Used for
the allocation of costs associated with the operation and maintenance of the
Risk Information System.
PRM - INSURANCE PREMIUMS
(NON-NUCLEAR)
Based on
non-nuclear insurance premiums.
Used for
the allocation of costs associated with risk management.
RAD - RADIO
USAGE
Based on
usage of Entergy’s 2-way radio system.
Used for
the allocation of costs associated with the administration and support of
Entergy’s 2-way radio system.
RAS - REMOTE ACCESS SERVICES
ID’s
Based on
the number of RAS ID’s within each Legal Entity at period end.
Used for
the allocation of costs associated with providing Remote Access Service to
Entergy employees and contractors.
RCM - RECORDS
MANAGEMENT
Based on
the number of employees at each Legal Entity using records management
services.
Used to
allocate costs associated with the management and supervision of non-nuclear
business unit records management processes.
RES - RESPONSIBILITY
RATIO
Based on
the ratio of the company's load at time of system peak load. The peak
load is the average of the twelve monthly highest clock-hour demands in
kilowatts of the interconnected system occurring each month coincident with the
system peak load.
Used
primarily for the allocation of costs incurred in fossil plant support and
integrated planning.
MAT - SUPPLY CHAIN MATERIALS
TRANSACTIONS
Based on
the number of Supply Chain materials transactions for each Legal
Entity.
Used for
the allocation of costs associated with the support of systems that manage
Supply Chain materials.
SCC – SUPPLY CHAIN -
Composite
Based on
three components with weighting to each: number of transactions, stockroom
count, and procurement total spending.
Used for
the allocation of costs associated with the management and operations of the
materials management and work order processing system.
SCL - SUPPLY CHAIN – Labor
Dollars
Based on
the labor dollars for the Transformer, Meter, and Light Shops.
Used
primarily for the allocation of costs associated with services provided by
employees in the supply chain equipment refurbishment and repair
department.
SCS - SUPPLY CHAIN –
Procurement Total Spending
Based on
the dollar amount of procurement spending within each Legal Entity at period
end.
Used for
the allocation of costs associated with procurement activities for the Entergy
System.
SQF - SQUARE
FOOTAGE
Based on
occupied square footage administrated by ESI Administrated Services
units.
Used
primarily to allocate the costs associated with facilities supervision and
support.
STR - DISTRIBUTION
SUBSTATIONS TRANSFORMERS
Based
on the number of transformers at the Distribution Substations at period
end.
Used
primarily for the allocation of costs associated with the maintenance,
administrative activities, and technical analysis of all Distribution
Substations.
SUB -
SUBSTATIONS
Based on
the number of high voltage substations weighted for Voltage (Voltage < 500kv
= 1; Voltage >= 500kv = 2).
Used
primarily for the allocation of related engineering and technical support for
transmission and distribution substation operations and maintenance as well as
for engineering and project management associated with substation
construction.
TEL -
TELEPHONES
Based on
the number of telephones within each Legal Entity at period end.
Used for
the allocation of costs associated with maintenance and support of
telephones.
TLN - TRANSMISSION LINE
MILES
Based on
the number of miles of transmission lines, weighted for design voltage (Voltage
< 400kv = 1; Voltage >=400kv =2).
Used
primarily for the allocation of costs associated with project design,
maintenance and installation of Entergy transmission lines.
TSL - COMPOSITE -
TRANSMISSION LINES/SUBSTATIONS
Based on
two components: Transmission Line Miles (30% weighting) and the Number of High
Voltage Substations (70% weighting).
Used
primarily for the allocation of the costs associated with the support of the
transmission and distribution function that has both a transmission line
component as well as a substation or load component.
UPS - UNIT POWER SALES
AGREEMENT
Based on
fixed allocation percentages under Entergy’s Unit Power Sales
Agreement.
Used
primarily for the allocation of certain Tax Department services in connection
with Entergy’s Unit Power Sales Agreement.
VEH -
VEHICLES
Based
on the number of vehicles owned by each Legal Entity.
Used for
the allocation of costs associated with the maintenance of company
vehicles.
CCP – CAPITAL CONSTRUCTION
PLAN
Based on
the total dollars budgeted for each Legal Entity in the annual capital
construction plans developed by the various functions.
Used for
the allocation of costs associated with capital construction
overheads.
PGR – PROCUREMENT OF
LONG-TERM GENERATION RESOURCES
Based on
the ownership/contractual interest of each Legal Entity in connection with the
procurement of those long-term generation resources where more than one Entergy
Operating Company is expected to hold an ownership/contractual
interest.
Used for
the allocation of costs associated with the procurement of long-term generation
resources where more than one Entergy Operating Company is expected to hold an
ownership/contractual interest.
