View:
United States securities and exchange commission logo
October 1, 2021
Carter Culver
Senior Vice President & Deputy General Counsel
Constellation Newholdco, Inc.
c/o Exelon Corporation
10 South Dearborn Street
P.O. Box 805379
Chicago, Illinois 60680-5379
Re: Constellation
Newholdco, Inc.
Amendment No. 1 to
Draft Registration Statement on Form 10-12B
Submitted September
14, 2021
CIK 0001868275
Dear Mr. Culver:
We have reviewed your amended draft registration statement and
have the following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Amendment No. 1 to Draft Registration Statement on Form 10-12B
Summary, page 1
1. We note your response
to prior comment 2. Please define the term "clean energy" and
clarify throughout, if
true, that your references to "carbon-free" is solely based on
your generation output
of electricity.
Carter Culver
FirstName LastNameCarter Culver
Constellation Newholdco, Inc.
Comapany
October NameConstellation Newholdco, Inc.
1, 2021
October
Page 2 1, 2021 Page 2
FirstName LastName
Risk Factors
Our financial performance could be negatively affected by matters arising from
our ownership
and operation of nuclear facilities, page 28
2. We note your response to prior comment 2. Please revise to enhance
your risk factor to
describe the operational risks arising from your ownership and
operation of nuclear
facilities. We note your disclosure on page 79 that the generation of
nuclear energy
results in spent nuclear fuel and radioactive waste.
The Separation
Background, page 38
3. We note your revisions in response to prior comment 6. Please expand
your disclosure to
discuss in greater detail the board's consideration of a sale of
Exelon s competitive
generation and customer facing business as a possible alternative,
including whether the
board considered or engaged in discussions, due diligence, or
negotiations regarding a
sale. In addition, disclose the reasons the board ultimately decided
the spin-off transaction
was a better strategic alternative than a sale.
Management's Discussion and Analysis of Financial Condition and Results of
Operations, page
95
4. We reviewed your response to prior comment 9. Discuss and analyze your
financial
position and the changes in your financial condition as required by
Item 303(a) and (b) of
Regulation S-K. Specifically, discuss and analyze material changes to
your balance sheet
and discuss material events and uncertainties that may impact your
future financial
condition.
Results of Operations , page 104
5. We have read your response to prior comment 10. Please reconcile the
non-GAAP
measure consolidated RNF to a GAAP gross profit that includes
depreciation and
amortization. In this regard, a GAAP gross profit should be used as
the starting point of
the non-GAAP reconciliation. Lastly, tell us whether you considered
the use of a different
caption for RNF.
6. We have read your response to prior comment 11. You state that you do
not believe an
analysis of the changes in operating revenues or purchased power and
fuel expense
provides useful information to investors given your business model and
implemented risk
mitigation strategy. However, it is unclear what your cost structure
is for nuclear
generation, fossil and renewables and purchased power or for example
why capacity
revenues have materially decreased in the Mid-Atlantic, Midwest and
Other Power
regions and materially increased in the New York region. Please revise
your results of
operations to discuss and analyze material changes in operating
revenues and energy costs
by generation source.
Carter Culver
Constellation Newholdco, Inc.
October 1, 2021
Page 3
7. We note the price of electricity is a key determinant of the
profitability of the Company.
Many variables can impact the price of electricity, such as the price of
different fuels,
weather and load growth. These variables differ by region and therefore
the price of
electricity varies by region. To increase transparency of the underlying
trends in the price
of electricity by region, an investor would benefit from additional
disclosure of the
average power price for each of your major markets or regions.
Additionally, it appears
you could disclose the realized average power price per region that
includes the impact of
settled hedges. Lastly, tell us how you allocate the effects of the
economic hedges to each
specific region.
Liquidity and Capital Resources, page 110
8. We have read your response to prior comment 12. It appears there are
other changes in
working capital that are not addressed in your response, such as changes
in accounts
payable and accrued expenses. Revise your operating cash flow discussion
to quantify,
discuss, and analyze each significant change in working capital and the
underlying reasons
for such changes.
You may contact Robert Babula, Staff Accountant, at 202-551-3339 or Gus
Rodriguez,
Accounting Branch Chief, at 202-551-3752 if you have questions regarding
comments on the
financial statements and related matters. Please contact Irene
Barberena-Meissner, Staff
Attorney, at 202-551-6548 or Loan Lauren Nguyen, Legal Branch Chief, at
202-551-3642 with
any other questions.
Sincerely,
FirstName LastNameCarter Culver
Division of
Corporation Finance
Comapany NameConstellation Newholdco, Inc.
Office of Energy &
Transportation
October 1, 2021 Page 3
cc: Tiffany Chan, Esq.
FirstName LastName