File No. 70-8769
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NUMBER TWO TO
FORM U-1
APPLICATION-DECLARATION WITH RESPECT TO
THE ACQUISITION OF A SUBSIDIARY IN CONNECTION WITH
THE PROVISION OF POWER MARKETING AND OTHER SERVICES
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
EASTERN UTILITIES ASSOCIATES
P.O. Box 2333, Boston, Massachusetts 02107
(Name of company filing this statement
and address of principal executive office)
EASTERN UTILITIES ASSOCIATES
(Name of top registered holding company parent of
applicant or declarant)
CLIFFORD J. HEBERT, JR., TREASURER
EASTERN UTILITIES ASSOCIATES
P.O. Box 2333, BOSTON, MASSACHUSETTS 02107
(Name and address of agent for service)
The Commission is requested to mail signed copies
of all orders, notices and communications to:
ARTHUR I. ANDERSON, P.C.
McDermott, Will & Emery
75 State Street
Boston, MA 02109
ITEM 1. DESCRIPTION OF THE PROPOSED TRANSACTION.
The first and third paragraphs under the LLC under ITEM 1.
DESCRIPTION OF THE PROPOSED TRANSACTIONS are amended to read as follows:
First Paragraph:
"The LLC was formed with Duke/Louis Dreyfus L.L.C., a Nevada limited
liability company ("D/LD"), for the purpose of providing energy services to
customers in the New England states: Connecticut, Maine, Massachusetts,
New Hampshire, Rhode Island and Vermont (the "Territory"), including buying
and selling electric power and brokering purchases and sales of electric
power ("Power Marketing"); buying and selling fuel (including gas and oil)
and brokering purchase and sales of fuel ("Fuels Marketing"); and
engineering, consulting and maintenance services for customers with respect
to equipment for the production of electricity or steam, efficiency
services and processes, and equipment retrofit (the "LLC Business"). The
LLC may provide financing to customers with respect to services furnished
or the equipment being furnished or retrofitted and alternatively may lease
such equipment to customers. The types of leases which the LLC may enter
into with customers may include true as well as finance leases.
As the market for electricity becomes increasingly deregulated, EUA
believes (i) that consumers of electricity will have increasing
opportunities to switch among energy sources based on, among other things,
pricing considerations and (ii) that electric generators will find it
increasingly to their advantage not to pass through fuel cost to their
customers and will, therefore, have to develop effective hedging mechanisms
including hedging with respect to fuel supply. The LLC plans to provide
Power Marketing and Fuels Marketing services to both producers and
consumers of electricity, in the case of energy consumers, to lower their
overall energy costs and, in the case of electric generators, to ensure
that they are able effectively to match production costs with sales
revenues. Accordingly, many of the LLC's customers will be offered Fuels
Marketing services in conjunction with Power Marketing services. EUA
requests that the Commission reserve jurisdiction over the provision of
Fuels Marketing services by the LLC where such services are not furnished
to electric power producers.
The LLC in appropriate circumstances will use options, swaps, futures
and other similar transactions ("derivative transactions") to offset the
price risk of a purchase or sale of energy products by taking an opposite
position to that purchase or sale. The LLC will establish operations,
policies and procedures to limit the risk associated with such
transactions. The establishment of operations policies and procedures with
respect to risk management requires the affirmative vote of at least one
member of the Executive Committee of the LLC appointed by Energy Services.
EUA represents that the risk management policies and procedures to be
established will result in the LLC's total volume of derivatives
transactions at any time being limited to no more than the total volume of
the LLC's fixed price purchase and fixed price sale commitments that are
subject to market price fluctuation. Therefore, the LLC's use of
derivatives will not be speculative in nature.
As part of its business, the LLC may determine to acquire, lease or
operate generating facilities in the future if doing so would not subject
the LLC to regulation as an electric utility subsidiary of EUA under the
Act. Any such activities by the LLC with respect to generating capacity
will be effected only pursuant to an available exemption or pursuant to a
Commission order in separate proceedings."
Third Paragraph:
"The LLC will initially conduct its Power Marketing activities in the
wholesale energy markets in the Territory. The LLC will sell energy to
wholesale customers to the extent permitted without becoming an "electric
utility company" or a "gas utility company" within the meaning of the
definitions of such terms in Sections 2(a)(3) and 2(a)(4) of the Act.
EUA requests that the Commission reserve jurisdiction over possible retail
sales of electricity and fuel by the LLC. Regulatory and legislative
initiatives are moving rapidly in the Territory and the LLC may be in a
position to pursue retail opportunities in the Territory in the near
future. A retail wheeling pilot program in New Hampshire is scheduled to
commence as of May 1, 1996. In Massachusetts, the Department of Public
Utilities (MDPU) issued an order on August 16, 1995 that requires, among
other things, investor-owned electric utilities to unbundle their rates and
provide customer choice with respect to generation services. Four
investor-owned electric utilities, including Eastern Edison Company, have
already filed plans with the MDPU. On February 7, 1997, a bill was
introduced in the Rhode Island legislature that, if enacted, would allow
customer choice of electricity supplier commencing January 1, 1998 for
large industrial customers and phasing in all customers by January 1,
2001."
The following paragraph is added as the last paragraph under ITEM 1.
DESCRIPTION OF THE PROPOSED TRANSACTIONS:
"As required by rule 54, all applicable conditions contained in rule
53(a) are, and assuming the consummation of the proposed transactions, will
be, satisfied and none of the conditions contained in rule 53(b) exist or
will exist as a result of the proposed transactions, making rule 53(c)
inapplicable."
ITEM 2. FEES, COMMISSIONS, AND EXPENSES.
The fees, Commissions and expenses of the Applicant expected to be
paid or incurred, directly or indirectly, in connection with the
transactions described are as follows:
Securities and Exchange Commission Filing Fee $2,000
Fees and Expenses of Company Counsel $130,000
Fees and Expenses of EUA Service Corporation $20,000
Total $152,000
ITEM 4. REGULATORY APPROVALS.
Item 4. is amended to read as follows:
No state Commission and no Federal Commission, other than the
Commission, has jurisdiction over the transactions for which authorization
is hereby requested.
Item 5. PROCEDURE.
Item 5. is amended to read as follows:
"(a) In order to be in a position to carry out the proposed
transactions at the most advantageous time, the Applicant requests
that the Commission issue its order hereon on the earliest practical
date.
(b) It is not considered necessary that there be a recommended
decision by a hearing officer or by any other responsible officer of
the Commission. The Office of Public Utilities Regulation may assist
in the preparation of the decision of the Commission, and it is
believed that a thirty (30) day waiting period between the issuance of
the order of the Commission and the day on which the order is to
become effective would not be appropriate.
(c) Energy Services will file certificates with the Commission
pursuant to Rule 24 within 45 days after the end of each calendar
quarter to report transactions authorized under the Act by this order,
and setting forth:
(1) a balance sheet as of the end of such quarter, and a statement of
income and expense for such quarter and the twelve-months
concluding as of the end of such quarter, for the LLC;
(2) a statement for such quarter of the amount of revenues
attributable to (i) buying, selling and brokering electric power, (ii)
buying, selling and brokering fuel, and (iii) engineering, consulting,
leasing and maintenance services (each stated separately);
(3) a statement as to whether the LLC has engaged in any derivative
transactions during the quarter; and
(4) a description of the types and dollar amounts of services
provided by EUA affiliates to Energy Services or the LLC during the
period, identifying the type of service good or construction contract,
the parties involved, and, if such transactions are not in compliance
with Rules 90 and 91 under the Act, the basis for the pricing of such
transactions."
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS (* Filed herewith) (**
Confidential treatment requested pursuant to Rule 104(b))
(***Incorporated by reference pursuant to Rule 22)
(a) Exhibits.
Exhibit A-1* Articles of Organization of Energy Services.
Exhibit A-2* By-Laws of Energy Services.
Exhibit B-1** Operating Agreement.
Exhibit F* Opinion of counsel
Exhibit G*** EUA System Lines of Credit
(Exhibit G, File No. 70-8713)
Exhibit H Proposed Form of Notice.
(b) Financial Statements.
None.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned Applicants have duly caused this statement to be
signed on their behalf by the undersigned duly authorized individual.
EASTERN UTILITIES ASSOCIATES
By: /s/ Clifford J. Hebert, Jr.
Clifford J. Hebert, Jr.
Treasurer
Dated March 13, 1996
Exhibit A-1
FORM OF ARTICLES OF ORGANIZATION
THE COMMONWEALTH OF MASSACHUSETTS
WILLIAM FRANCIS GALVIN
Secretary of the Commonwealth
One Ashburton Place, Boston, Massachusetts 02108-1512
ARTICLES OF ORGANIZATION
(General Laws, Chapter 156B)
ARTICLE I
The exact name of the corporation is:
EUA Energy Services, Inc.
ARTICLE II
The purpose of the corporation is to engage in the following
business activities:
To engage in and carry on businesses providing energy-
related products and services to residential and commercial
purchasers; and
To engage in and carry on any other business or activity
which may lawfully be engaged in or carried on by a corporation
which is organized under Chapter 156B of the General Laws of the
Commonwealth of Massachusetts as presently in effect or as
amended from time to time, or any successor provisions adopted in
lieu thereof.
ARTICLE III
The type and classes of stock and the total number of shares and
par value, if any, of each type and class of stock which the
corporation is authorized to issue.
WITHOUT PAR VALUE WITH PAR VALUE
TYPE: NO. OF SHARES TYPE: NO. OF SHARES PAR VALUE
COMMON: COMMON: 200,000 .01
PREFERRED: PREFERRED:
ARTICLE IV
If more than one class of stock is authorized, state a
distinguishing designation for each class. Prior to the issuance
of any shares of a class, if shares of another class are
outstanding, the corporation must provide a description of the
preferences, voting powers, qualifications, and special or
relative rights or privileges of that class and of each other
class of which shares are outstanding and of each series then
established within any class.
N/A
ARTICLE V
The restrictions, if any, imposed by the Articles of Organization
upon the transfer of shares of stock of any class are:
N/A
ARTICLE VI
*Other lawful provisions, if any, for the conduct and regulation
of the business and affairs of the corporation, for its voluntary
dissolution, or for limiting, defining, or regulating the powers
of the corporation, or of its directors or stockholders, or of
any class of stockholders:
(a) The Board of Directors may make, amend or repeal the By-Laws
of the corporation in whole or in part, except with respect to
any provision thereof which by law or the By-Laws requires action
by the stockholders. Any by-law adopted by the Board of
Directors may be amended or repealed by the stockholders.
(b) Meetings of the stockholders may be held anywhere in the
United States.
(c) The corporation may be a partner, either general or limited,
in any business enterprise it would have the power to conduct by
itself.
(d) No current or former director of the corporation shall be
personally liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director
notwithstanding any provision of law imposing such liability;
provided, however, that this provision shall not eliminate the
liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 61
or 62 or successor provisions of the Massachusetts Business
Corporation Law or (iv) for any transaction from which the
director derived an improper personal benefit. This provision
shall not eliminate the liability of a director for any act or
omission occurring prior to the date upon which this provision
becomes effective. No amendment to or repeal of this provision
shall apply to or have any effect on the liability or alleged
liability of any director for or with respect to any acts or
omissions of such director occurring prior to such amendment or
repeal.
(e) No contract or transaction between the corporation and one
or more of its directors or officers, or between the corporation
and any other organization of which one or more of its directors
or officers are directors, trustees or officers, or in which any
of them has any financial or other interest, shall be void or
voidable, or in any way affected, solely for this reason, or
solely because the director or officer is present at or
participates in the meeting of the board of directors or
committee thereof which authorizes, approves or ratifies the
contract or transaction, or solely because his/her or their votes
are counted for such purposes, if:
(i) The material facts as to his/her relationship or
interest and as to the contract or transaction are
disclosed or are known to the Board of Directors or the
committee which authorizes, approves or ratifies the
contract or transaction, and the board or committee in
good faith authorizes, approves or ratifies the
contract or transaction by the affirmative vote of a
majority of the disinterested directors, even though
the disinterested directors be less than a quorum; or
(ii) The material facts as to his/her relationship or
interest and as to the contract or transaction are
disclosed or are known to the stockholders entitled to
vote thereon, and the contract or transaction is
specifically authorized, approved or ratified in good
faith by vote of the stockholders; or
(iii) The contract or transaction is fair as to the
corporation as of the time it is authorized, approved
or ratified by the Board of Directors, a committee
thereof, or the stockholders.
Common or interested directors may be counted in determining the
presence of a quorum at a meeting of the board of directors or of
a committee thereof which authorizes, approves or ratifies the
contract or transaction. No director or officer of the
corporation shall be liable or accountable to the corporation or
to any of its stockholders or creditors or to any other person,
either for any loss to the corporation or to any other person or
for any gains or profits realized by such director or officer, by
reason of any contract or transaction as to which clauses (i),
(ii) or (iii) above are applicable.
*If there are no provisions state "None".
Note: The preceding six (6) articles are considered to be
permanent and may ONLY be changed by filing appropriate Articles
of Amendment.
ARTICLE VII
The effective date of organization of the corporation shall be
the date approved and filed by the Secretary of the Commonwealth.
If a LATER effective date is desired, specify such date which
shall not be more than thirty days after the date of filing.
ARTICLE VIII
The information contained in Article VIII is NOT a PERMANENT part
of the Articles of Organization.
a. The street address of the principal office of the corporation
IN MASSACHUSETTS is: (post office boxes are not acceptable)
c/o Eastern Utilities Associates
One Liberty Square
Boston, MA 02107
Attention: President
b. The name, residential address and post office address of the
directors and officers of the corporation are as follows:
DIRECTORS
Post Office
Name Residence Address
John D. Carney 99 Mt. Prospect Street Same
Bridgewater, MA 02324
Kevin A. Kirby 61 Monument Neck Road Same
Bourne, MA 02532
Donald G. Pardus 238 Glezen Lane Same
Wayland, MA 01778
Robert G. Powderly 42 Wayside Lane Same
Ashland, MA 01721
John R. Stevens 41 Old Village Road Same
Acton, MA 01720
OFFICERS
Post
Office
Title Name Residence Address
Chairman Donald G. Pardus 238 Glezen Lane Same
Wayland, MA 01778
President John R. Stevens 41 Old Village Road Same
Acton, MA 01720
Vice President Kevin A. Kirby 61 Monument Neck Road Same
Bourne, MA 02532
Clerk Clifford J. 3 Hammond Place Same
Hebert, Jr. Woburn, MA 01801
Treasurer Clifford J. 3 Hammond Place Same
Hebert, Jr. Woburn, MA 01801
c. The fiscal year (i.e., tax year) of the corporation shall end on
the last day of the month of: December
d. The name and BUSINESS address of the RESIDENT AGENT of the
corporation, if any, is:
ARTICLE IX
By-laws of the corporation have been duly adopted and the president,
treasurer, clerk and directors whose names are set forth above, have
been duly elected.
IN WITNESS WHEREOF AND UNDER THE PAINS AND PENALTIES OF PERJURY, I/we
whose signature(s) appear below as incorporator(s) and whose name(s)
and business or residential address(es) ARE CLEARLY TYPED OR PRINTED
beneath each signature do hereby associate with the intention of
forming this corporation under the provisions of General Laws Chapter
156B and do hereby sign these Articles of Organization as
incorporator(s) this 5th day of December, 1995.
Aaron R. Muirhead, Incorporator
McDermott, Will & Emery
75 State Street
Boston, Massachusetts 02109
Note: If an existing corporation is acting as incorporator, type in
the exact name of the corporation, the state or other jurisdiction
where it was incorporated, the name of the person signing on behalf of
said corporation and the title he/she holds or other authority by
which such action is taken.
THE COMMONWEALTH OF MASSACHUSETTS
ARTICLES OF ORGANIZATION
(General Laws, Chapter 156B)
____________________________________________
I hereby certify that, upon examination of these Articles of
Organization, duly submitted to me, it appears that the provisions of
the General Laws relative to the organization of corporations have
been complied with, and I hereby approve said articles; and the filing
fee in the amount of $200.00 having been paid, said articles are
deemed to have been filed with me this 5th day of December, 1995.
Effective date:
WILLIAM FRANCIS GALVIN
Secretary of the Commonwealth
FILING FEE: One tenth of one percent of the total authorized capital
stock, but not less than $200.00. For the purpose of filing, shares
of stock with a par value less than $1.00, or no par stock, shall be
deemed to have a par value of $1.00 per share.
TO BE FILLED IN BY CORPORATION
Photocopy of document to be sent to:
Walter A. Foskett, P.C.
McDermott, Will & Emery
75 State Street
Boston, MA 02109
Telephone: (617) 345-5022
Exhibit A-2
BY-LAWS
OF
EUA ENERGY SERVICES, INC.
BY-LAWS
OF
EUA ENERGY SERVICES, INC.
ARTICLE I
OFFICES
Section 1.1. Principal Office. The initial principal
office of the Corporation shall be as indicated in the Articles
of Organization of the Corporation. The Corporation may have
such other offices, either within or without the Commonwealth of
Massachusetts, as it may require from time to time.
Section l.2. Change in Principal Office. The Board of
Directors of the Corporation may at any time and from time to
time, change the principal office of the Corporation in the
Commonwealth, provided that no such change shall be effective
until a certificate of such change, specifying the post-office
address of its new principal office in the Commonwealth, signed
under the penalties of perjury by the clerk or an assistant clerk
of the Corporation, has been filed with the state secretary.
ARTICLE II
STOCKHOLDERS
Section 2.1. Place of Meetings. All meetings of the
stockholders for the election of directors shall be held at the
offices of the Corporation or elsewhere in the United States as
the Board of Directors may designate.
Section 2.2. Annual Meetings. An annual meeting of the
stockholders, commencing with the year 1996 shall be held on the
second Tuesday in April in each year, but if a legal holiday,
then on the next business day following, at 10:00 o'clock A.M.,
at which the stockholders shall elect a Board of Directors and
transact such other business as may properly be brought before
such meeting.
Section 2.3. Special Meetings. Special meetings of the
stockholders may be called by the President or by the directors,
and shall be called by the Clerk, or in case of the death,
absence, incapacity or refusal of the Clerk, by any other
officer, upon written application of one or more stockholders who
hold at least one-tenth part in interest of the capital stock
entitled to vote thereat. In case none of the officers is able
and willing to call a special meeting, the Supreme Judicial or
Superior Court, upon application of one or more stockholders who
hold at least one-tenth part in interest of the capital stock
entitled to vote thereat, shall have jurisdiction in equity to
authorize one or more of such stockholders to call a meeting by
giving such notice as is required by law.
Section 2.4. Notice of Meetings. A written notice of the
place, date and hour of all meetings of stockholders stating the
purposes of the meeting shall be given by the Clerk or an
assistant Clerk (or other person authorized by the By-Laws or
empowered pursuant to Section 2.3) at least seven days before the
meeting to each stockholder entitled to vote thereat and to each
stockholder who, under the Articles of Organization or under the
By-Laws, is entitled to such notice, by leaving such notice with
him or at his residence or usual place of business, or by mailing
it, postage prepaid, and addressed to such stockholder at his
address as it appears in the records of the Corporation.
Section 2.5. Waiver of Notice. Whenever notice of a
meeting is required to be given a stockholder under any provision
of the law or of the Articles of Organization or these By-Laws, a
written waiver thereof, executed before or after the meeting by
such stockholder or his attorney thereunto authorized and filed
with the records of meeting, shall be deemed equivalent to such
notice.
Section 2.6. Closing of Transfer Books and Fixing of Record
Date. The directors may fix in advance a time, which, unless a
shorter period is provided in the Articles of Organization, shall
be not more than sixty days before the date of any meeting of
stockholders or the date for the payment of any dividend or the
making of any distribution to stockholders or the last day on
which the consent or dissent of stockholders may be effectively
expressed for any purpose, as the record date for determining the
stockholders having the right to notice of and to vote at such
meeting and any adjournment thereof or the right to receive such
dividend or distribution or the right to give such consent or
dissent, and in such case only stockholders of record on such
record date shall have such right, notwithstanding any transfer
of stock on the books of the Corporation after the record date;
or without fixing such record date the directors may for any of
such purposes close the transfer books for all or any part of
such period.
If no record date is fixed and the transfer books are not
closed:
The record date for determining stockholders having the
right to notice of or to vote at a meeting of stockholders shall
be at the close of business on the day next preceding the day on
which notice is given.
The record date for determining stockholders for any
other purpose shall be at the close of business on the day on
which the Board of Directors acts with respect thereto.
Section 2.7. Quorum. A majority of the shares of the
Corporation issued, outstanding and entitled to vote at a meeting
represented in person or by proxy shall constitute a quorum at
any meeting of stockholders.
Section 2.8. Manner of Acting. If a quorum is present, the
affirmative vote of the majority of the shares represented at the
meeting shall be the act of the stockholders, unless the vote of
a greater number or voting by classes is required by the Business
Corporation Law of the Commonwealth of Massachusetts or the
Articles of Organization or these By-Laws.
Section 2.9. Proxies. Stockholders may vote in person or
by proxy. No proxy dated more than six months before the meeting
named therein shall be valid and no proxy shall be valid after
the final adjournment of such meeting. Notwithstanding the
provisions of the foregoing sentence, a proxy coupled with an
interest sufficient in law to support an irrevocable power,
including, without limitation, an interest in shares or in the
corporation generally, may be made irrevocable if it so provides,
need not specify the meeting to which it relates, and shall be
valid and enforceable until the interest terminates, or for such
shorter period as may be specified in the proxy. Any proxy shall
be filed with the Clerk of the Corporation before or at the time
of the meeting. A proxy with respect to stock held in the name
of two or more persons shall be valid if executed by any one of
them unless at or prior to exercise of the proxy the Corporation
receives a specific written notice to the contrary from any one
of them. A proxy purporting to be executed by or on behalf of a
stockholder shall be deemed valid unless challenged at or prior
to its exercise and the burden of proving invalidity shall rest
on the challenger.
Section 2.10. Voting of Shares. Stockholders entitled to
vote shall have one vote for each share of stock owned by them
and a proportionate vote for a fractional share, unless otherwise
provided by the Articles of Organization.
Section 2.11. Informal Action by Stockholders. Any action
required or permitted to be taken at any meeting of the
stockholders may be taken without a meeting if all stockholders
entitled to vote on the matter consent to the action in writing
and the written consents are filed with the records of the
meetings of stockholders. Such consent shall be treated for all
purposes as a vote at a meeting.
Section 2.12. Voting Agreements. An agreement between two
or more stockholders or between one or more stockholders and one
or more other persons, if in writing and signed by the parties
thereto, may provide that the shares held by such stockholders
shall be voted under procedures set forth in said agreement.
ARTICLE III
DIRECTORS
Section 3.1. General Powers. The business and affairs of
the Corporation shall be managed by a Board of Directors.
Section 3.2. Number, Election and Term of Office. The
Board of Directors shall consist of not less than three
directors, except that whenever there shall be only two
stockholders the number of directors shall be not less than two,
and whenever there shall be only one stockholder the number of
directors shall be not less than one. The number of the
directors shall be as determined from time to time by the
stockholders and may be enlarged between meetings of the
stockholders by the vote of a majority of the directors then in
office. The directors shall be chosen at the annual meeting of
the stockholders by such stockholders as have the right to vote
thereon, and each shall hold office until the next annual
election of directors and until his successor is chosen and
qualified or until he sooner dies, resigns, is removed or becomes
disqualified. No director need be a stockholder. Any election
of directors by stockholders shall be by ballot if so requested
by any stockholder entitled to vote thereon.
Section 3.3. Regular Meetings. A regular meeting of the
Board of Directors shall be held without other notice than this
By-Law, immediately after, and at the same place as, the annual
meeting of stockholders. The Board of Directors may provide, by
resolution, the time and place, either within or without the
Commonwealth of Massachusetts, for the holding of additional
regular meetings in which case no other notice need be given.
Section 3.4. Special Meetings. Special meetings of the
Board of Directors may be called by or at the request of the
President or any two (2) directors. The person or persons
authorized to call special meetings of the Board of Directors may
fix any place, either within or without the Commonwealth of
Massachusetts, as the place for holding any special meeting of
the Board of Directors.
Section 3.5. Notice. Written notice of any special meeting
of directors shall be given as follows:
By mail to each director at his business address at
least three days prior to the meeting; or
By personal delivery or telegram to each director at
his business address at least 24 hours prior to the meeting, or
in the event such notice is given on a Saturday, Sunday or
holiday, to each director at his residence address at least 24
hours prior to the meeting. If mailed, such notice shall be
deemed to be delivered when deposited in the United States mail
so addressed, with postage thereon prepaid. If notice is given
by telegram, such notice shall be deemed to be delivered when the
telegram is delivered to the telegraph company.
Notice of a meeting need not be given to any director,
if a written waiver of notice, executed by him before or after
the meeting, is filed with the records of the meeting, or to any
director who attends the meeting without protesting prior thereto
or at its commencement the lack of notice to him. Neither the
business to be transacted at, nor the purpose of, any regular or
special meeting of the Board of Directors need be specified in
the notice or waiver of notice of such meeting.
Section 3.6. Quorum. The number of directors required to
constitute a quorum shall be a majority of the directors then in
office. If a quorum is present, a majority of the directors
present may take any action on behalf of the board except to the
extent that a larger number is required by law or the Articles of
Organization or these By-Laws.
Section 3.7. Meetings by Telecommunications. Unless the
Articles of Organization otherwise provide, members of the Board
of Directors or any committee designated thereby may participate
in a meeting of such board or committee by means of a conference
telephone or similar communications equipment by means of which
all persons participating in the meeting can hear each other at
the same time and participation by such means shall constitute
presence in person at a meeting.
Section 3.8. Vacancies. Any vacancy occurring in the Board
of Directors and any directorship to be filled by reason of an
increase in the number of directors may be filled by election at
a meeting of the stockholders or of the Board of Directors. A
director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office.
Section 3.9. Compensation. By resolution of the Board of
Directors, irrespective of any personal interest of any of the
members, the directors may be paid their expenses, if any, of
attendance at each meeting of the Board of Directors and may be
paid a fixed sum for attendance at meetings or a stated salary as
directors. These payments shall not preclude any director from
serving the Corporation in any other capacity and receiving
compensation therefor.
Section 3.10. Presumption of Assent. A director of the
Corporation who is present at a meeting of the Board of Directors
at which action on any corporate matter is taken shall be
conclusively presumed to have assented to the action taken unless
his dissent is entered in the minutes of the meeting or unless he
files his written dissent to such action with the person acting
as the secretary of the meeting before the adjournment of the
meeting or forwards such dissent by registered mail to the Clerk
of the Corporation immediately after the adjournment of the
meeting. Such right to dissent does not apply to a director who
voted in favor of such action.
Section 3.11. Committees of Directors. The Corporation may
provide for an executive committee or other committees to be
elected from and by the Board of Directors, and the directors may
delegate to any such committee or committees some or all of their
powers, except, however, the power
(a) to change the principal office of the Corporation;
(b) to amend By-Laws;
(c) to elect officers and to fill vacancies in any
such offices;
(d) to change the number of the Board of Directors and
to fill vacancies in the Board of Directors;
(e) to remove officers or directors from office;
(f) to authorize the payment of any dividend or
distribution to shareholders;
(g) to authorize the reacquisition for value of stock
of the Corporation; or
(h) to authorize a merger.
Except as otherwise provided in the Articles of
Organization, the directors may determine the manner of
conducting committee business, whether at a meeting or otherwise,
and the number of members required to take specified types of
action. The designation of any such committee and the delegation
of any authority thereto shall not operate to relieve the
directors from any responsibility imposed upon them by law.
Section 3.12. Informal Action by Directors. Any action
required or permitted to be taken at any meeting of the Board of
Directors or the Executive Committee, if any, may be taken
without a meeting, if all the directors entitled to vote consent
to the action in writing and the written consents are filed with
the records of the meetings. Such consents shall be treated for
all purposes as a vote at a meeting.
Section 3.13. Removal of Directors. Any director may be
removed from his office with or without cause by vote of the
holders of a majority of the shares entitled to vote in the
election of directors, provided that the directors of a class
elected by a particular class of stockholders may be removed only
by the vote of the holders of a majority of the shares of the
particular class of stockholders entitled to vote for the
election of such directors. Any director may be removed from his
office for cause by vote of a majority of the directors then in
office. A director may be removed for cause only after a
reasonable notice and opportunity to be heard before the body
proposing to remove him.
ARTICLE IV
OFFICERS
Section 4.1. Number. The officers of the Corporation shall
be a President, a Treasurer and a Clerk, each of whom shall be
elected by the Board of Directors. The Board of Directors may
appoint such other officers as they deem necessary who shall have
such authority and shall perform such duties as from time to time
may be prescribed by the Board of Directors. Any person may
simultaneously hold more than one office of the Corporation.
Section 4.2. Election and Term of Office. The officers of
the Corporation shall be elected annually by the Board of
Directors at the first meeting of the Board of Directors held
after each annual meeting of stockholders. If the election of
officers is not held at that meeting, the election shall be held
as soon thereafter as practicable. Each officer shall hold
office until his successor shall have been duly elected and shall
have qualified or until his death or until he shall resign or
shall have been removed in the manner hereinafter provided.
Section 4.3. Removal. Any officer or agent of the
Corporation may be removed with or without cause by the Board of
Directors whenever in its judgment the best interests of the
Corporation would be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person
so removed.
Section 4.4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may
be filled by the Board of Directors for the unexpired portion of
the term. Vacancies may be filled or new offices filled at any
meeting of the Board of Directors.
Section 4.5. Bonds. If the Board of Directors by
resolution shall so require, any officer or agent of the
Corporation shall give bond to the Corporation in such amount and
with such surety as the Board of Directors may deem sufficient,
conditioned upon the faithful performance of their respective
duties and offices.
Section 4.6. President. The President shall be the chief
executive officer of the Corporation and shall in general
supervise and control all of the business and affairs of the
Corporation. He shall preside at all meetings of the
stockholders and of the Board of Directors. He may sign, with
the Clerk or any other proper officer of the Corporation
thereunto authorized by the Board of Directors, certificates for
shares of the Corporation, any deeds, mortgages, bonds, contracts
or other instruments which the Board of Directors has authorized
to be executed, except in cases where the signing and execution
thereof shall be expressly delegated by the Board of Directors or
by these By-Laws to some other officer or agent of the
Corporation or shall be required by law to be otherwise signed or
executed; and in general shall perform all duties incident to the
office of President and such other duties as may be prescribed by
the Board of Directors from time to time. The President need not
be a director.
Section 4.7. Vice Presidents. In the absence of the
President or in the event of his inability or refusal to act, the
Vice President (or, in the event there is more than one Vice
President, Vice Presidents in the order designated, or in the
absence of any designation, then in the order of their election)
shall perform the duties of the President. Any Vice President
may sign, with the Treasurer or an Assistant Treasurer,
certificates for shares of the Corporation, and shall perform
those other duties which from time to time may be assigned to him
by the Board of Directors or by the chief executive officer.
Section 4.8. Treasurer. The Treasurer shall: (a) have
charge and custody of and be responsible for all funds and
securities of the Corporation; receive and give receipts for
moneys due and payable to the Corporation from any source
whatsoever and deposit all such moneys in the name of the
Corporation in such banks, trust companies or other depositories
as shall be selected in accordance with the provisions of
Article V of these By-Laws; (b) sign with the President or Vice
President certificates for shares of the Corporation's stock; and
(c) in general, perform all duties incident to the office of
Treasurer and all other duties as from time to time may be
assigned to him by the Board of Directors or the chief executive
officer. If required by the Board of Directors, the Treasurer
shall give a bond for the faithful discharge of his duties in the
sum and with a surety or sureties as the Board of Directors shall
determine.
Section 4.9. Clerk. The Clerk shall: (a) keep the minutes
of the stockholders' and of the Board of Directors' meetings in
one or more books provided for that purpose; (b) see that all
notices are duly given in accordance with the provisions of these
By-Laws or as required by law; (c) be custodian of the corporate
records and, if the Corporation has a corporate seal, of the seal
of the Corporation and see that the seal of the Corporation is
affixed to all certificates for shares prior to the issue thereof
and to all documents, the execution of which on behalf of the
Corporation under its seal is duly authorized in accordance with
the provisions of these By-Laws; (d) keep a register of the post
office address of each stockholder which shall be furnished to
the Clerk by such stockholder; (e) have general charge of the
share transfer books of the Corporation; and (f) in general,
perform all duties incident to the office of Clerk and all other
duties as from time to time may be assigned to him by the Board
of Directors or the chief executive officer.
Section 4.10. Assistant Treasurers and Assistant Clerks.
The Assistant Treasurer as thereunto authorized by the Board of
Directors may sign with the President or a Vice President
certificates for shares of the Corporation's stock, the issue of
which shall have been authorized by a resolution of the Board of
Directors. The Assistant Treasurers and Assistant Clerks, in
general, shall perform such duties as shall be assigned to them
by the Treasurer or the Clerk, respectively, or by the Board of
Directors or the chief executive officer. The Assistant
Treasurers shall, if required by the Board of Directors, give
bonds for the faithful discharge of their duties in sums and with
sureties as the Board of Directors shall determine.
Section 4.11. Salaries. The salaries of the officers shall
be fixed from time to time by the Board of Directors, and no
officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the Corporation.
ARTICLE V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 5.1. Contracts. The Board of Directors may
authorize any officer or officers, agent or agents to enter into
any contract or execute and deliver any instrument in the name of
and on behalf of the Corporation, and such authority may be
general or confined to specific instances.
Section 5.2. Loans. No loans shall be contracted on behalf
of the Corporation and no evidences of indebtedness shall be
issued in its name unless authorized by a resolution of the Board
of Directors. Such authority may be general or confined to
specific instances. No loans shall be made by the Corporation
secured by its shares.
Section 5.3. Checks, Drafts, Etc. All checks, drafts or
other order for the payment of money, notes or other evidences of
indebtedness issued in the name of the Corporation shall be
signed by such officer or officers, agent or agents of the
Corporation and in the manner which shall from time to time be
determined by resolution of the Board of Directors.
Section 5.4. Deposits. All funds of the Corporation not
otherwise employed shall be deposited from time to time to the
credit of the Corporation in banks, trust companies or other
depositories which the Board of Directors may select.
ARTICLE VI
SHARES, CERTIFICATES FOR SHARES AND TRANSFER OF SHARES
Section 6.1. Regulation. The Board of Directors may make
such rules and regulations as it may deem expedient concerning
the issuance, transfer and registration of certificates for
shares of the Corporation, including the appointment of transfer
agents and registrars. Any unissued capital stock from time to
time authorized under the Articles of Organization may be issued
by vote of the stockholders or by vote of the directors. No
stock shall be issued unless the cash, so far as due, or the
property, services or expenses for which it was authorized to be
issued, has been actually received or incurred by, or conveyed or
rendered to, the Corporation, or is in its possession as surplus.
Section 6.2. Certificates for Shares. Each stockholder
shall be entitled to a certificate stating the number and the
class and the designation of the series, if any, of the shares
held by him. Such certificate shall be signed by the President
or a Vice President and by the Treasurer or an Assistant
Treasurer. Such signatures may be facsimiles if the certificate
is signed by a transfer agent, or by a registrar, other than a
director, officer or employee of the Corporation. In case any
officer who has signed or whose facsimile signature has been
placed on such certificate shall have ceased to be such officer
before such certificate is issued, it may be issued by the
Corporation with the same effect as if he were such officer at
the time of its issue. Every certificate issued for shares of
stock at a time when such shares are subject to any restriction
on transfer pursuant to the Articles of Organization, these
By-Laws or any agreement to which the Corporation is a party
shall have the restriction noted conspicuously on the certificate
and shall also set forth on the face or back of the certificate
either the full text of the restriction, or a statement of the
existence of such restriction and a statement that the
Corporation will furnish a copy thereof to the holder of such
certificate upon written request and without charge. Every stock
certificate issued at a time when the Corporation is authorized
to issue more than one class or series of stock shall set forth
upon the face or back of the certificate either the full text of
the preferences, voting powers, qualifications and special and
relative rights of the shares of each class and series, if any,
authorized to be issued, as set forth in the Articles of
Organization, or a statement of the existence of such
preferences, powers, qualifications and rights, and a statement
that the Corporation will furnish a copy thereof to the holder of
such certificate upon written request and without charge.
Each certificate representing shares shall also state
the name of the Corporation, the date of issue, that the
Corporation is organized under the laws of the Commonwealth of
Massachusetts, the name of the person to whom it is issued, and
the par value of each share represented by the certificate or a
statement that the shares are without par value. Each
certificate shall be otherwise in such form as may be prescribed
by the Board of Directors and as shall conform to the rules of
any Stock Exchange on which the shares may be listed.
Section 6.3. Cancellation of Certificates. All
certificates surrendered to the Corporation for transfer shall be
canceled and no new certificates shall be issued in lieu thereof
until the former certificate for a like number of shares shall
have been surrendered and canceled, except as herein provided
with respect to lost, stolen or destroyed certificates.
Section 6.4. Lost, Stolen or Destroyed Certificates.
Subject to Section 8-405 of the Massachusetts Uniform Commercial
Code, as amended from time to time, the Board of Directors shall
determine the conditions upon which a new certificate of stock
may be issued in place of any certificate alleged to have been
lost, mutilated or destroyed. They may, in their discretion,
require the owner of a lost, mutilated or destroyed certificate,
or his legal representative, to give a bond, sufficient in their
opinion, with or without surety, to indemnify the Corporation
against any loss or claim which may arise by reason of the issue
of a certificate in place of such lost, mutilated or destroyed
stock certificate.
Section 6.5. Transfer of Shares. The Corporation may from
time to time enter into an agreement or agreements with one or
more of its stockholders restricting the transferability of its
shares in accordance with the general corporate purpose to have
its shares owned by persons actively engaged in the corporate
business. Subject to the terms of any such agreement, shares of
the Corporation shall be transferable on the books of the
Corporation by the holder thereof, in person or by his duly
authorized attorney, upon the surrender and cancellation of a
certificate or certificates for a like number of shares. Upon
presentation and surrender of a certificate for shares properly
endorsed and payment of all required taxes, if any, the
transferee shall be entitled to a new certificate or certificates
in lieu thereof. As against the Corporation, a transfer of
shares can be made only on the books of the Corporation and in
the manner hereinabove provided, and the Corporation shall be
entitled to treat the holder of record of any share as the owner
thereof and shall not be bound to recognize any equitable or
other claim to or interest in such share on the part of any other
person, whether or not it shall have express or other notice
thereof, except as expressly provided by the statutes of the
Commonwealth of Massachusetts.
ARTICLE VII
FISCAL YEAR
The fiscal year of the Corporation shall end on the
31st day of December in each calendar year.
ARTICLE VIII
DIVIDENDS
The Board of Directors may from time to time declare,
and the Corporation may pay, dividends on its outstanding shares
in the manner and upon the terms and conditions provided by law
and its Articles of Organization.
ARTICLE IX
SEAL
The Board of Directors may provide a corporate seal
which shall be in the form of a circle and shall have inscribed
thereon the name of the Corporation and the words "Corporate
Seal, Massachusetts," or shall be in such other form as the Board
of Directors may from time to time determine.
ARTICLE X
INDEMNIFICATION
The Corporation shall, to the maximum extent legally
permissible, indemnify all directors, officers, employees and
other agents of the Corporation, and persons who serve at its
request as directors, officers, employees or other agents of
another organization, or who serve at its request in any capacity
with respect to any employee benefit plan, against all liability
and expenses, including counsel fees, reasonably incurred by or
imposed upon such person in connection with any proceeding in
which he may become involved by reason of his serving or having
served in such capacity (other than a proceeding voluntarily
initiated by such person unless he is successful on the merits,
the proceeding was authorized by a majority of the Board of
Directors or the proceeding seeks a declaratory judgment
regarding his own conduct). Such indemnification shall include
payment by the Corporation of expenses incurred in defending a
civil or criminal action or proceeding in advance of the final
disposition of such action or proceeding, upon receipt of an
undertaking by the person indemnified to repay such payment if he
shall be adjudicated to be not entitled to indemnification under
this Article which undertaking may be accepted without reference
to the financial ability of such person to make repayment. Any
such indemnification shall be provided although the person to be
indemnified is no longer an officer, director, employee or agent
of the Corporation or of such other organization or no longer
serves with respect to any such employee benefit plan.
No indemnification shall be provided for any person
with respect to any matter as to which he shall have been
adjudicated in any proceeding not to have acted in good faith in
the reasonable belief that his action was in the best interests
of the Corporation or to the extent that such matter relates to
service with respect to an employee benefit plan, in the best
interests of the participants or beneficiaries of such employee
benefit plan. The Board of Directors shall have power to
purchase and maintain insurance on behalf of any person who is or
was a director, officer, employee or other agent of the
Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or other agent of
another organization or with respect to any employee benefit
plan, against any liability incurred by him in any such capacity,
or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such
liability.
ARTICLE XI
CONFLICT OF INTEREST
No contract or transaction between the corporation and one
or more of its directors or officers, or between the corporation
and any other organization of which one or more of its directors
or officers are directors, trustees or officers, or in which any
of them has any financial or other interest, shall be void or
voidable, or in any way affected, solely for this reason, or
solely because the director or officer is present at or
participates in the meeting of the board of directors or
committee thereof which authorizes, approves or ratifies the
contract or transaction, or solely because his or their votes are
counted for such purposes, if:
(i) The material facts as to his relationship or interest
and as to the contract or transaction are disclosed or
are known to the Board of Directors or the committee
which authorizes, approves or ratifies the contract or
transaction, and the board or committee in good faith
authorizes, approves or ratifies the contract or
transaction by the affirmative vote of a majority of
the disinterested directors, even though the
disinterested directors be less than a quorum; or
(ii) The material facts as to his relationship or interest
and as to the contract or transaction are disclosed or
are known to the stockholders entitled to vote thereon,
and the contract or transaction is specifically
authorized, approved or ratified in good faith by vote
of the stockholders; or
(iii) The contract or transaction is fair as to the
corporation as of the time it is authorized, approved
or ratified by the Board of Directors, a committee
thereof, or the stockholders.
Common or interested directors may be counted in determining the
presence of a quorum at a meeting of the board of directors or of
a committee thereof which authorizes, approves or ratifies the
contract or transaction. No director or officer of the
corporation shall be liable or accountable to the corporation or
to any of its stockholders or creditors or to any other person,
either for any loss to the corporation or to any other person or
for any gains or profits realized by such director or officer, by
reason of any contract or transaction as to which clauses (i),
(ii) or (iii) above are applicable.
ARTICLE XII
CORPORATE RECORDS
The original, or attested copies, of the Articles of
Organization, By-Laws, and records of all meetings of the
incorporators and stockholders, and the stock and transfer
records, which shall contain the names of all stockholders and
the record address and the amount of stock held by each, shall be
kept in the Commonwealth for inspection by the stockholders at
the Corporation's principal office or an office of the Clerk, or
of the transfer agent or the Resident Agent, if any. Said copies
and records need not all be kept in the same office.
ARTICLE XIII
AMENDMENTS
These By-Laws may be altered, amended or repealed and
new By-Laws may be adopted by a majority of the stockholders
present at any meeting of the stockholders of the Corporation at
which a quorum is present. These By-Laws may also be altered,
amended or repealed and new By-Laws may be adopted by a majority
of the directors present at any meeting of the Board of Directors
of the Corporation at which a quorum is present, except with
respect to any provision thereof which by law, the Articles of
Organization or these By-Laws requires action by the
stockholders. Not later than the time of giving notice of the
meeting of stockholders next following the making, amending or
repealing by the directors of any by-law, notice thereof stating
the substance of such changes shall be given to all stockholders
entitled to vote on amending the by-laws. Any by-law adopted by
the directors may be amended or repealed by the stockholders.
EXHIBIT B-1, OPERATING AGREEMENT
**FILED WITH CONFIDENTIAL TREATMENT REQUEST**
Exhibit F
March 13, 1996
Securities and Exchange Commission
Washington, D.C. 20549
Re:File No. 70-8769: Eastern Utilities Associates --
Acquisition of a Subsidiary in Connection with the
Provision of Power Marketing and Other Services
Ladies and Gentlemen:
As counsel for Eastern Utilities Associates ("EUA"), we are
furnishing this opinion letter to be used in connection with that
certain application-declaration on Form U-1 dated December 21,
1995, as amended by Amendment No. 1 dated January 26, 1996 and
Amendment No. 2 dated March 13, 1996, filed by EUA with the
Securities and Exchange Commission (the "Commission") under the
Public Utility Holding Company Act of 1935, File No. 70-8769 (the
"Application-Declaration"), with respect to the acquisition of a
subsidiary in connection with the provision of power marketing
and other services (the "Proposed Transactions"), as more fully
described in the Application-Declaration.
It is our opinion, subject to the additional assumptions,
exceptions and qualifications hereinafter stated, that in the
event the Proposed Transactions are consummated in accordance
with the terms and conditions of the Application-Declaration:
(a) all State laws applicable to the Proposed Transactions
will have been complied with by EUA;
(b) EUA is a validly organized and duly existing voluntary
association under the laws of The Commonwealth of Massachusetts;
and
(c) The consummation of the Proposed Transactions will not
violate the legal rights of the holders of any of the securities
of EUA or any of EUA Cogenex Corporation ("Cogenex"), EUA Energy
Investment Corporation ("EUA Energy"), EUA Service Corporation
("Service"), Eastern Edison Company ("Eastern"), Montaup Electric
Company ("Montaup"), Blackstone Valley Electric Company
("Blackstone"), Newport Electric Corporation ("Newport"), EUA
Ocean State Corporation ("Ocean State"), OSP Finance Company
("OSP"), Northeast Energy Management, Inc. ("NEM"), EUA Citizens
Conservation Services, Inc. ("CCS"), EUA Highland Corporation
("Highland"), EUA Cogenex-Canada Inc. ("Cogenex-Canada") (each of
NEM, CCS, Highland and Cogenex-Canada being an associate or
subsidiary company of Cogenex), EUA TransCapacity, Inc.
("TransCapacity"), EUA BIOTEN, Inc. ("BIOTEN") (TransCapacity and
BIOTEN being associate companies of EUA Energy), Ocean State
Power ("OSP I") or Ocean State Power II ("OSP II") (OSP I and OSP
II being Rhode Island general partnerships).
In addition to being subject to the consummation of the
Proposed Transactions in accordance with the provisions of the
Application-Declaration, the opinions expressed in this letter
are also subject to the following additional assumptions,
exceptions and qualifications:
(1) compliance with such order or orders as the Commission
may issue from time to time upon the Application-Declaration;
(2) the accuracy of information furnished to us as to the
outstanding securities of EUA, Cogenex, EUA Energy, Service,
Eastern, Montaup, Blackstone, Newport, Ocean State, OSP, NEM,
CCS, Highland, Cogenex-Canada, TransCapacity, BIOTEN, OSP I and
OSP II;
(3) that all requirements of applicable state securities or
"blue sky" laws will have been complied with;
(4) that the enforceability of the Proposed Transactions
may be subject to and affected by applicable bankruptcy,
receivership, insolvency, reorganization, moratorium, fraudulent
conveyance or other laws affecting the enforcement of the rights
and remedies of creditors generally (including, without
limitation, such as may deny giving effect to waivers of rights
to debtors or guarantors); and such duties and standards as are
or may be imposed on creditors, including, without limitation,
good faith, reasonableness and fair dealing under any applicable
statute, rule, regulation or judicial decision; and
(5) that the enforceability of the Proposed Transactions
may be subject to and affected by general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law) and the exercise of equitable
powers by a court of competent jurisdiction (and no opinion is
given herein as to specific performance or as to the availability
of other equitable remedies or equitable relief of any kind).
The opinions expressed in this letter relate only to federal
law and the laws of The Commonwealth of Massachusetts and we
express no opinion with respect to any other jurisdiction. To
the extent that certain matters addressed may involve the laws of
other states, we have assumed that such laws are not materially
different from the laws of The Commonwealth of Massachusetts.
We consent to the use of this opinion letter in connection
with the Application-Declaration filed with the Commission.
Very truly yours,
/s/ McDermott, Will & Emery
McDERMOTT, WILL & EMERY
EUA SYSTEM LINES OF CREDIT (EXHIBIT G, FILE 70-8713)
(INCORPORATED BY REFERENCE)
