Post-Effective Amendment No. 3
to SEC File No. 70-8179
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-1
APPLICATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ("Act")
ENERGY INITIATIVES, INC. ("EI")
One Upper Pond Road
Parsippany, New Jersey 07054
(Name of company filing this statement and address
of principal executive office)
GENERAL PUBLIC UTILITIES CORPORATION ("GPU")
(Name of top registered holding company parent of applicant)
Don W. Myers, Vice President Douglas E. Davidson, Esq.
and Treasurer Berlack, Israels & Liberman
M. A. Nalewako, Secretary 120 West 45th Street
GPU Service Corporation New York, New York 10036
100 Interpace Parkway
Parsippany, New Jersey 07054
B. L. Levy, President
K. A. Tomblin, Secretary
Energy Initiatives, Inc.
One Upper Pond Road
Parsippany, New Jersey 07054
(Names and addresses of agents for service)
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EI hereby post-effectively amends its Application on
Form U-1, docketed in SEC File No. 70-8179, as follows:
A. By amending paragraph G of Post-Effective
Amendment No. 2 thereof to read in its entirety as follows:
"The fees, commissions and expenses
expected to be incurred by EI in connection
with the proposed transactions are estimated
as follows:
Legal Fees:
Berlack, Israels & Liberman $3,500
Miscellaneous 1,500
Total $5,000"
B. By filing the following exhibits in Item 6
thereof:
(a) Exhibits:
A-7 - Form of letter of credit and
reimbursement agreement.
F(a) - Opinion of Berlack, Israels &
Liberman.
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SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935, THE UNDERSIGNED COMPANY HAS DULY
CAUSED THIS STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
ENERGY INITIATIVES, INC.
By:______________________________
B. L. Levy, President
Date: March 22, 1994
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EXHIBITS TO BE FILED BY EDGAR
Exhibits:
A-7 - Form of letter of credit and reim-
bursement agreement.
F(a) - Opinion of Berlack, Israels &
Liberman.
<PAGE>
Exhibit A-7
(Form of Reimbursement Agreement)
TERMS AND CONDITIONS
The Applicant (hereinafter called the "Obligor"), agrees as
follows:
1. It is acknowledged and agreed that the letter of credit
issued pursuant hereto (which, inclusive of any increase,
extension, amendment, renewal or partial renewal thereof and any
guaranty or bond issued by any branch, affiliate or correspondent
of Bank in reliance on this application and agreement and/or the
Letter of Credit, and hereinafter collectively called the
"Credit") shall constitute an obligation separate from and
independent of any obligations arising out of this Agreement or
any contract between any Obligor and the Beneficiary.
2. Availments under the Credit may be effected through the
Payor at the current buying rate of the Payor for bankers sight
drafts on the place from which the Payor is to receive
reimbursement under the terms of the Credit, it being understood
and further agreed: (a) that the amount(s) disbursed to the
Beneficiary(ies) relative thereto may be in currency local to the
site of the Payor, less any taxes and/or other charges, whether
of the Payor or otherwise, and (b) that an advice of an availment
under the Credit from the Payor shall be sufficient evidence of
any availment under the Credit and such evidence thereof shall be
binding upon the Obligor for the purposes of this Agreement.
3. To pay on demand in United States currency to Bank, at its
office at (address), U.S.A., the following sums:
(a) If the Credit is in United States currency, a sum equal
to each amount which shall have been withdrawn or shall
purport to have been withdrawn under the Credit at any
time(s) (whether evidenced by any one or more drafts,
receipts, cablegrams or otherwise), plus (i) interest from
the date of such withdrawal at Bank's prime rate as then in
effect plus _______, (ii) any and all liabilities, charges
and expenses (including attorneys' fees) which Bank, any
confirming or advising bank or Payor may pay, incur or
charge relative to the Credit, and (iii) the commissions
described on the preceding page(s) hereof;
(b) If the Credit is in other than United States currency,
a sum equal to the equivalent in United States currency of
each amount which shall have been withdrawn or purport to
have been withdrawn under the Credit (whether evidenced by
any one or more drafts, receipts, cablegrams or otherwise),
such equivalent to be calculated on the basis of Bank's
selling rate of exchange in effect (for the date on which
Bank pays such draft or reimburses any Payor which paid such
draft) for cable transfers to the place where and in the
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currency in which such draft or other evidence of withdrawal
is payable (if no such rate of exchange is then in effect,
then such equivalent shall be the actual cost to Bank of
settlement of its obligation to the Payor or holder of the
draft, however and whenever such settlement shall be made by
Bank), plus (i) interest from the date of such withdrawal at
__________, _______________ (ii) any and all liabilities,
charges and expenses (including attorneys' fees) which Bank,
any confirming or advising bank or Payor may pay, incur or
charge relative to the Credit, and (iii) the commissions
described on the preceding page(s) hereof;
(c) Any and all amounts otherwise payable under or in
connection with this Agreement or the Credit; and
(d) Interest on any and all amounts unpaid hereunder at
__________________.
4. The Obligor will promptly examine (a) the copy of the Credit
(and any amendments thereof) sent to the Obligor by Bank and (b)
all instruments and documents delivered to the Obligor from time
to time by Bank, and the Obligor will, within twenty-four (24)
hours of receipt thereof, notify Bank of any irregularity or
claim of non-compliance with the Obligor's instructions. The
Obligor will be conclusively deemed to have waived any such claim
against Bank and Bank's correspondents unless such notice is
given as aforesaid.
5. The term "Obligations", as used in this Agreement, shall
mean (a) all sums at any time payable to Bank under or in
connection with this Agreement or the Credit, including those
referred to in paragraph 3 above, and whether direct or indirect,
absolute or contingent, secured or unsecured, matured or
unmatured.
(6. As hereinafter used, the term "Collateral" shall mean
_______ __________________. To secure the prompt and
unconditional payment and performance of the Obligations, the
Obligor grants to and creates in favor of Bank a first lien and
security interest in the Collateral. Obligor agrees that Bank
shall have the right to apply toward and set off against the
Obligations at any time, whether or not a Default (as hereinafter
defined) has occurred, any or all of the Collateral and any and
all amounts owing to the Obligor by Bank. Should the net
realizable value of the Collateral available to Bank decline or
otherwise be insufficient, in Bank's sole judgment, to secure
Bank adequately in connection with Obligations which have arisen
or which Bank expects to arise, then the Obligor shall, on
demand, promptly provide Bank with such additional Collateral as
Bank may require.)
(7. Bank is hereby irrevocably authorized and empowered (a) for
itself and as attorney-in-fact with power of substitution for the
Obligor and in its, his or her name and in its, his or her
behalf, to execute and file financing statements and mortgages
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and take such other action as Bank may deem necessary or
desirable to create, attach, perfect, continue, preserve, enforce
and realize upon Bank's first lien and security interest in the
Collateral, including, without limitation, the power to endorse
items of Collateral in the name of Obligor; (b) to insure,
maintain, repair, protect and collect the Collateral; and (c) to
defend and preserve the title of the Obligor to the Collateral,
and Bank's first lien and security interest therein, free and
clear from all other liens, pledges, security interests,
mortgages and other encumbrances, and the Obligor agrees to pay
all costs, expenses, liabilities and obligations, including
attorneys' fees and expenses, incurred by Bank in taking any
action permitted by or incidental to this Agreement or the
Credit, provided, however, that Bank shall not be obligated to
take any such action and Bank shall have no liability for any
failure, refusal or delay in taking any such action.)
(8. Obligors represent, warrant and covenant to Bank that the
following are and shall remain true, complete and correct: (a)
the Collateral will at all times be free and clear of all liens,
pledges, security interests, mortgages and other encumbrances,
except Bank's first lien and security interest; (b) this
Agreement has been duly and validly executed and delivered by the
Obligors and its execution, delivery and performance have been
authorized by all necessary corporate action; and (c) neither
this Agreement nor the Credit nor any transaction to which this
Agreement or the Credit relates violates or will violate any
applicable law or regulation, including without limitation, the
Export Administration Act of 1979 and Section 999 of the Internal
Revenue Code of 1954, both as amended, and the regulations
thereunder, and the provisions of any successor or supplementary
laws and regulations.)
9. Bank may (a) accept and pay drafts or other withdrawals
under the Credit drawn "without recourse"; (b) confirm or advise
the Credit through one or more correspondents or other Payors or
directly; (c) honor drafts drawn under the Credit for less than
the maximum aggregate amount of the Credit; (d) accept or pay, as
complying with the terms of the Credit, any drafts or other
withdrawals signed or issued by any administrator, executor,
trustee in bankruptcy, debtor in possession, assignee for benefit
of creditors, liquidator, receiver, successor, assign, agent,
attorney in fact or other representative of any Beneficiary; (e)
accept or pay any draft or other evidence of withdrawal dated on
or before the Credit expiration date, regardless of when drawn
and when or whether negotiated; and (f) accept documents of any
character which comply with the provisions, definitions,
interpretations and practices contained in the Uniform Customs
and Practice for Documentary Credits, 1983 Revision,
International Chamber of Commerce Publication No. 400, and any
subsequent revisions thereof approved by a Congress of the
International Chamber of Commerce and adhered to by Bank.
10. It is agreed that neither Bank nor any confirming or
advising bank nor any Payor shall be responsible for, and the
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Obligations shall not be affected by, (a) the use which may be
made of the Credit or any act or omission of any Beneficiary or
assignee of the Credit; (b) any act, omission, insolvency or
failure in business of any confirming or advising bank or any of
Bank's correspondents, Payors, agents or subagents; (c) the
validity, sufficiency, genuineness or collectibility of any
drafts, instruments, certificates of default, evidences of
withdrawal or other documents, including endorsements and
signatures thereon; (d) any breach of contract between the
Obligor and any other party; (e) compliance with or circumstances
resulting from the existence of enforcement of laws, regulations,
rules, customs, provisions, foreign exchange restrictions or
other official directives (whether or not having the force of law
but if not the observance of which is reasonable considering the
practice of bankers in the county concerned) issued by any
government, or by any agency or instrumentality thereof, or by
any person (dejure or defacto) exercising such powers; (f) any
failure of drafts or other evidences of withdrawal to bear
reference or adequate reference to the Credit, failure of
negotiating banks to comply with directions of the Obligor or
failure of any person to surrender, take up or forward the Credit
or to note thereon any withdrawal thereunder, each of which
requirements Bank may waive even if included in the Credit; (g)
any errors, omissions, interruptions or delays in transmission or
delivery of any messages, however sent and whether plain or in
code or cipher, or errors in translation or in interpretation of
technical or other terms; (h) force majeure, or any event, fact
or condition beyond the control of Bank, and (i) without limiting
the foregoing, any act or omission of Bank or any confirming or
advising bank or any of Bank's correspondents, Payors, agents or
subagents done or omitted in good faith. Bank and Payor are
expressly authorized and directed to honor any request for
payment which is made under and in compliance with the Credit
without regard to, and without any duty to inquire into, the
existence of any disputes or controversies between the Obligor,
any Beneficiaries or any other person or firm, or their
respective rights, duties or liabilities or whether any fact or
event referred to in any certificate of default or other document
presented under the Credit is true and correct. The sole
obligation of Bank and Payor to the Obligor is limited to
honoring requests for payment made under and in compliance with
the Credit notwithstanding the fact that Bank may have assisted
Obligor in preparation of the wording of the Credit or any
certificate of default or other document required to be presented
thereunder and/or that Bank or Payor may otherwise be aware of
facts concerning the transaction which gives rise to the Credit.
11. The term "Default", as used in this Agreement, shall mean
any of the following: (a) the failure of the Obligor to pay or
perform promptly any part of any Obligation when due or otherwise
in accordance with its terms or the terms of any related
agreement, mortgage or other instrument or document, or the
breach or failure of any payment or performance of any part of
any Obligation; (b) the acceleration of any indebtedness of the
Obligor in the principal amount of $1 million or more; (c) the
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death or insolvency of the Obligor; (d) the commencement or
filing by or against the Obligor of any proceeding or petition
for arrangement, reorganization, dissolution or liquidation or of
any proceeding or petition under any law relating to bankruptcy,
insolvency, receivership or the like; (e) any suspension of the
usual business, assignment for the benefit of creditors or
meeting of creditors of the Obligor; (f) any offer or comment to
a composition or extension to the creditors of or appointment of
a committee of creditors or liquidating agent for the Obligor;
(g) any failure at any time of any representation or warranty or
information, furnished by the Obligor to Bank in any context, to
be and remain true, correct and complete; (h) the breach by the
Obligor or the failure of any material covenant, agreement, term
or condition under or in connection with this Agreement; and (i)
any levy or attachment against any Collateral.
(12. Upon the occurrence of a Default, Bank shall have, in
addition to all other rights and remedies hereunder or under
other applicable law, all the rights and remedies of a secured
party under the Pennsylvania Uniform Commercial Code, and Bank
may, at its option, (a) declare all or part of the Obligations
immediately due and payable, without notice, demand or
presentment, which are hereby waived; (b) reduce its claim to
judgment, foreclose or otherwise enforce its lien and security
interest in all or any part of the Collateral by any judicial
procedure or set-off or other form of or self-help; (c) after
reasonable notice (except in the case of Collateral which is
perishable or threatens to decline speedily in value), which is
hereby agreed to mean five days' written notice, sell or
otherwise dispose of all or part of the Collateral at such places
and on such terms and conditions as Bank may see fit. Upon
demand, the Obligor shall assemble the Collateral at such
locations as Bank shall designate. The proceeds of any sale,
collection or other disposition of the Collateral shall be
applied by Bank in payment of the Obligations, including the
costs and expenses of the sale or collection, and as otherwise
required by law, and to particular Obligations and against
principal and/or interest in such lawful amounts as Bank in its
discretion may elect, and any surplus shall be paid to Obligor,
its, his or her successors or assigns, or to whomsoever may be
lawfully entitled to receive the same or as a court of competent
jurisdiction shall determine. Obligor shall remain liable to
Bank for and shall pay to Bank any deficiency which may remain
after such sale or collection.)
13. Bank may assign or transfer all or any part of any of the
Obligations and may transfer as security therefor all or any part
of the Collateral and thereafter Bank shall be fully discharged
from all liability and responsibility with respect to the
Collateral so transferred and the transferee shall be vested with
all Bank's powers and rights hereunder with respect thereto, but
with respect to all Collateral not so transferred Bank shall
retain all rights and powers hereunder. Bank is authorized, at
its option and without any obligation to do so, to transfer to or
register in the name of any of its nominees all or any party of
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the Collateral, and such action may be taken before or after the
maturity of any part of the Obligations and without notice to the
Obligor.
14. All rights and remedies of Bank hereunder are cumulative of
each other and of every other right or remedy which Bank may
otherwise have at law or in equity or under any other contract or
other writing for the enforcement of the security interest herein
or the collection of the Obligations. Without limiting the scope
of the foregoing, it is agreed that this Agreement shall be
supplemented by the provisions (to the extent that such
provisions are consistent with the provisions of this Agreement)
of the Uniform Customs and Practice for Documentary Credits, 1983
Revision, International Chamber of Commerce Publication No. 400,
and any subsequent revisions thereof approved by a Congress of
the International Chamber of Commerce and adhered to by Bank.
15. No delay on the party of Bank in exercising any right, power
or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege
preclude other or further exercise thereof or the exercise of any
other right, power or privilege or shall be construed to be a
waiver of any Default. No waiver by Bank of any Default shall be
effective unless in writing and signed by an authorized officer
of Bank, and no such waiver shall be deemed to be a waiver of a
subsequent Default or be deemed to be a continuing waiver. No
course of dealing between Obligor and Bank or its agents or
employees shall be effective to change, modify or discharge any
provision of this Agreement or to constitute a waiver of any
Default. Bank shall not, under any circumstances or in any event
whatsoever, have any liability for any error or omission or delay
of any kind occurring in the liquidation of any Collateral,
including the settlement, collection or payment of any
Collateral, or for any damage resulting therefrom. If any
provision of this Agreement is held invalid or unenforceable to
any extent or in any application, the remainder of this
Agreement, or the application of such provision to different
persons or circumstances or in different jurisdictions, shall not
be affected thereby.
16. Obligor agrees to defend, indemnify and hold harmless Bank,
any confirming or advising bank, and Bank's correspondents,
Payors, agents and subagents from and against any and all
demands, actions, damages, claims, losses, penalties, liabilities
and expenses (including attorneys' fees and expenses), not
involving Bank's bad faith, resulting from or incurred, suffered
or paid by any of them in connection with this Agreement, the
Credit or any breach or failure of any representation, warranty,
covenant, agreement, term or condition of this Agreement. At any
time that an attorney is used to enforce any Obligation or this
Agreement, the Obligor shall pay Bank its reasonable attorneys'
fees incurred in such enforcement.
17. In the event of any increase in the amount of the Credit, or
the extension (for one or more periods, whether or not longer
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than the original period) of the time for presentation of drafts
or for withdrawals under the Credit, or the renewal or any other
modification of any term of the Credit, at the request of the
Obligor, with or without notice to any other person, this
Agreement and Bank's rights hereunder shall continue unimpaired
and shall be binding upon the Obligor with respect to the Credit
so increased, extended, renewed or modified and with respect to
any action taken by Bank or any of its Payors or correspondents
in accordance with such increase, extension, renewal or other
modification. If the Credit is to be issued in favor of any
commercial entity which is to issue a commitment in Bank's behalf
in connection therewith, the Obligor shall remain liable to Bank
until Bank is released by such entity.
18. All notices, statements, requests and demands under this
Agreement shall be deemed to have been made when mailed first
class, postage prepaid, to each party at the address appearing in
this Agreement or as it may otherwise direct in writing. This
Agreement shall be governed by, and construed and enforced in
accordance with, the laws of Pennsylvania. This Agreement may be
changed or modified only by a writing signed by all parties.
This Agreement shall be binding upon and inure to the benefit of
the parties hereto, their respective successors and assigns,
except that the Obligor may not assign any of its, his or her
rights or delegate any of its, his or her duties hereunder
without the prior written consent of Bank.
_________________________________
Name of Customer
Energy Initiatives, Inc.
Address
One Upper Pond Road
Parsippany, NJ 07054
Telephone
(201) 263-6957
Authorized signature
_________________________________
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(LETTERHEAD OF BERLACK, ISRAELS & LIBERMAN)
Exhibit F(a)
March 22, 1994
Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549
Re: Energy Initiatives, Inc.
Application on Form U-1
SEC File No. 70-8179
Dear Sirs:
We have examined Post-Effective Amendment No. 2, dated
December 30, 1993, to the Application on Form U-1, dated March
30, 1993, under the Public Utility Holding Company Act of 1935
(the "Act"), filed by Energy Initiatives, Inc. ("EI") with the
Securities and Exchange Commission (the "Commission"), and
docketed by the Commission in SEC File No. 70-8179, and Post-
Effective Amendment No. 3 thereto, dated this date, of which this
opinion is to be a part. (The Application, as so amended and
thus to be amended, is hereinafter referred to as the
"Application").
The Application now contemplates, among other things,
the acquisition by EI from time to time, pursuant to the terms
and conditions of a Stock Purchase Agreement, of up to 400
additional non-voting shares of common stock ("Additional
Shares") of a non-affiliated, privately held Delaware corporation
("Cogen Corp.") engaged in the business of developing, owning or
operating non-utility power generation projects which will be
either "qualifying facilities" under the Public Utility
Regulatory Policies Act of 1978 and the regulations of the
Federal Energy Regulatory Commission ("FERC") thereunder, or
"exempt wholesale generators" or "foreign utility companies" as
defined under the Act and the applicable regulations of the
Commission and the FERC, and in such other activities as EI may
lawfully engage in under the Act, at a purchase price of $2,500
per share.
<PAGE>
Securities and Exchange Commission
March 22, 1994
Page 2
The Application also contemplates the entering into by
EI of a letter of credit reimbursement agreement ("Reimbursement
Agreement") in respect of a letter of credit having a face amount
of up to $2.5 million, which would be delivered to Cogen Corp. to
secure in part EI's obligation to purchase the Additional Shares
and certain other Cogen Corp. shares pursuant to the Stock
Purchase Agreement.
In addition to the matters set forth in our previous
opinion dated August 23, 1993 and filed as Exhibit F to the
Application, we have examined a copy of the Commission's Order,
dated September 7, 1993, granting the Application, as then
amended. We have also examined such other documents and made
such further investigation as we have deemed necessary as a basis
for this opinion.
We have been counsel to GPU and to its indirect subsi-
diary, EI, for many years. In that connection, we have partici-
pated in various proceedings relating to the issuance of
securities by GPU and its subsidiaries, and we are familiar with
the terms of the outstanding securities of the corporations
comprising the GPU holding company system.
Based upon and subject to the foregoing, and assuming
that the transactions therein proposed are carried out in accor-
dance with the Application, we are of the opinion that when the
Commission shall have entered a supplemental order forthwith
granting the Application,
(a) all State laws applicable to the
proposed transactions will have been complied
with,
(b) EI will legally acquire the Addi-
tional Shares,
(c) the Reimbursement Agreement will be
a valid and binding obligation of EI in
accordance with its terms, subject to the
effect of any applicable bankruptcy,
insolvencey, reorganization, moratorium or
other similar laws affecting creditors'
rights generally and general principles of
equity limiting the availability of equitable
remedies, and
<PAGE>
Securities and Exchange Commission
March 22, 1994
Page 3
(d) the consummation of the
transactions proposed in the Application will
not violate the legal rights of the holders
of any securities issued by EI or any
"associate company" thereof, as defined in
the Act.
We hereby consent to the filing of this opinion as an
exhibit to the Application and in any proceedings before the
Commission that may be held in connection therewith.
Very truly yours,
BERLACK, ISRAELS & LIBERMAN
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