File No. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
APPLICATION-DECLARATION WITH RESPECT TO
PARTICIPATION BY
EUA ENERGY INVESTMENT CORPORATION
IN A JOINT VENTURE TO DEVELOP AND COMMERCIALIZE
A HOME ENVIRONMENTAL AUDIT AND ENVIRONMENTAL REMEDIATION BUSINESS
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
EUA ENERGY INVESTMENT CORPORATION
P.O. Box 2333, Boston, Massachusetts 02107
(Name of companies 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, Massachusetts 02109
Item 1. Description of Proposed Transactions.
I. Introduction
A. Background of Applicant. This application-declaration is filed
with the United States Securities and Exchange Commission (the
"Commission") by EUA Energy Investment Corporation ("EEIC", or the
"Applicant"), a Massachusetts corporation and a wholly-owned subsidiary of
Eastern Utilities Associates ("EUA"), a Massachusetts voluntary association
and a registered public holding company under the Public Utility Holding
Company Act of 1935 (the "Act"). The holding company system of EUA is
sometimes hereinafter referred to as the "EUA System" or the "System".
B. Overview of Application. In this application-declaration, the
Applicant seeks Commission approval to incorporate a Massachusetts business
corporation (the "EEIC Subsidiary") to participate as the general partner
of a proposed joint venture limited partnership to be formed under
Massachusetts law (such proposed joint venture hereinafter referred to as
"Home & Family") for the purpose of developing and commercializing a home
environmental audit and environmental remediation business including, but
not limited to, home environmental testing of soil, air, water and
substances found in or about the home and the remediation of home
environmental problems (the "Business Opportunity"). To complement the
energy audit services that various EUA System companies now offer to their
customers, EEIC, together with Home & Family Limited Partnership, a
Massachusetts limited partnership ("H&F LP"), and pursuant to the
Commission's order allowing EEIC to engage in certain research and
development activities (Release No. 35-24515 dated December 4, 1987, as
amended by Release No. 35-26028 dated April 15, 1994; hereinafter, the
"Order"), is developing certain Proprietary Materials (defined in Paragraph
II.B below). Upon Commission authorization and subject to EEIC's
discretion, EEIC will contribute such Proprietary Materials to the EEIC
Subsidiary in exchange for capital stock in the EEIC Subsidiary. No other
person or entity will own stock in the EEIC Subsidiary.
Upon (i) EEIC's receipt of Commission authorization, and (ii) EEIC's
determination to proceed with the Business Opportunity following successful
completion of a research, development and test marketing pilot program (the
"Pilot Program"), H&F LP will contribute the name "Home & Family", its
intellectual property and its proprietary materials developed on or before
June 1, 1994 (the "H&F Materials") to Home & Family in exchange for a
limited partner interest therein. EEIC, for itself and for the EEIC
Subsidiary, requests Commission approval under Sections 6, 7, 9(a), 10, 12
and 13(b) of the Act to then transfer the Proprietary Materials to Home &
Family and to provide certain financing to Home & Family in exchange for a
general partner interest therein. For itself and for the EEIC Subsidiary,
EEIC also seeks Commission approval to make additional capital
contributions and loans or advances (as described in Paragraph II.D below)
to Home & Family.
The initial authorized capitalization of the EEIC Subsidiary shall be
200,000 shares of Common Stock, $.01 par value per share, and EEIC will be
issued a portion of such Common Stock in exchange for its contribution to
the EEIC Subsidiary of the Proprietary Materials. References to EEIC
hereinafter shall mean EEIC or the EEIC Subsidiary, where the context so
allows. Forms of Articles of Organization and By-Laws of the EEIC
Subsidiary are attached hereto as Exhibits A-1 and A-2, respectively.
II. Development and Commercialization of the Business Opportunity.
A. Parties and Principal Agreements. EEIC, H&F LP, Regina Meade
Management, Inc., a Massachusetts corporation and the general partner of
H&F LP ("RMM"), Bruce Meade, Inc., a Massachusetts corporation ("BMI"),
Bruce M. McCarthy and B. Meade McCarthy, Jr., all of which or whom except
EEIC are sometimes collectively referred to herein as the "Home & Family
Parties", have entered into various agreements for the development of the
Proprietary Materials and the development and commercialization of the
Business Opportunity. The principal operative agreements for the proposed
transactions, attached hereto as Exhibits B-1, B-2 and A-3, respectively,
include a Research and Development Agreement (as amended), an Agreement to
Form Joint Venture and a Form of Partnership Agreement of Home & Family.
B. Research and Development Agreement. EEIC and the Home & Family
Parties entered into a research and development agreement dated September
26, 1994, as amended by Amendment No. 1 dated February 22, 1995 (the
"Research and Development Agreement"), pursuant to which EEIC is funding
research and development of the Business Opportunity in an amount up to
$2,100,000, subject to agreed upon milestones and budgets. Pursuant to the
Research and Development Agreement, EEIC owns all right, title and interest
in and to all proprietary materials for the Business Opportunity developed
after June 1, 1994 including, without limitation, all trademarks, service
marks, trade names, trade designs, packaging designs, logos, trade styles,
market research, marketing materials, copyrighted materials, business
plans, telephone numbers, telemarketing scripts, marketing surveys and the
results thereof, computer software programs, patents, copyrights, trade
secrets, know-how, and all documentation, tangible expressions of, and
applications for, any of the foregoing, in each case relating in any way to
the Business Opportunity (the "Proprietary Materials").
Upon completion of the Pilot Program, EEIC will have the right to
elect whether to pursue or decline the Business Opportunity. If EEIC
determines not to pursue the Business Opportunity, H&F LP will have the
right to purchase the Proprietary Materials from EEIC for 120% of the
amount actually expended by EEIC under the Research and Development
Agreement. Subject to Commission authorization, such payment will be
deferred until H&F LP has sufficient liquid working capital to begin making
cash distributions to its partners. If Home & Family does not elect to
purchase the Proprietary Materials, all copies will be returned to EEIC and
each Home & Family Party will agree not to compete with the Business
Opportunity for a period of one year thereafter.
C. Agreement to Form Joint Venture. EEIC and the Home & Family
Parties have entered into an Agreement to Form Joint Venture dated as of
February 22, 1995, attached as Exhibit B-2, to more fully set forth the
rights and obligations of the parties upon successful completion of the
Pilot Program. If EEIC elects to pursue the Business Opportunity, then
upon receipt of Commission authorization, EEIC and H&F LP will form Home &
Family pursuant to the terms and conditions set forth in the Form of
Agreement of Limited Partnership attached hereto as Exhibit A-3. EEIC will
provide Home & Family with a non-transferable royalty-free license, on the
terms and conditions attached hereto as Exhibit B-3, to use the Proprietary
Materials related to the Business Opportunity until the earlier of (i) the
date the Proprietary Materials are transferred to Home & Family after EEIC
receives Commission authorization to participate therein, (ii) the granting
of a negotiated license by EEIC to H&F LP to use the Proprietary Materials,
(iii) the sale of the Proprietary Materials or the receipt by EEIC of
notice of H&F LP's election to not purchase the Proprietary Materials, or
(iv) any material breach by H&F LP of any of the terms of the interim
license provisions set forth in the attached Exhibit B-3.
Each of EEIC and H&F LP shall have liquidity rights, rights of first
refusal and co-sale rights with respect to its respective ownership
interest in Home & Family. With respect to H&F LP, from and after the
later to occur of (i) the third anniversary of the Commission's approval of
the formation of Home & Family (the "Commission Approval Date"), or (ii)
the Conversion Date (defined in the second paragraph of Section II.D
below), but in any event no later than the fifth anniversary of the
Commission Approval Date, and with respect to EEIC, from and after the
third anniversary of the Commission Approval Date, EEIC and H&F LP each
will have the right to request that the other (or a designee thereof) shall
purchase its partnership interest in Home & Family for a mutually agreed
upon purchase price or, in the absence of such agreement, a purchase price
equal to the appraised fair market value of such partnership interest. If
the non-initiating partner does not elect to purchase the initiating
partner's ownership interest in Home & Family, then EEIC and H&F LP shall
have thirty days to agree to either sell the assets of Home & Family or
reorganize and attempt an initial public offering thereof, provided that
the initiating partner wishes to pursue one of those possibilities. The
expenses of an initial public offering would be borne proportionately in
accordance with the respective numbers of shares offered in such offering
by each of the partners of Home & Family.
EEIC and H&F LP each will have a right of first refusal with respect
to the purchase of the Partnership Interest held by the other. In the event
either EEIC or H&F LP desires to sell its partnership interest in Home &
Family (or any portion thereof) to a third party, the selling partner will
cause the purchaser to offer to acquire the partnership interest or a pro
rata portion of the partnership interest of the non-selling partner on the
same terms as the purchase of the selling partner's partnership interest.
D. EEIC Equity Participation. Under the Research and Development
Agreement and the Agreement to Form Joint Venture, and upon Commission
authorization, EEIC will contribute the Proprietary Materials (having an
agreed upon value equal to EEIC's aggregate contribution of $2,100,000
under the Research and Development Agreement) to Home & Family and will
become a general partner of Home & Family, and Home & Family will become a
"subsidiary company" within the meaning of Section 2(a)(8) of, and subject
to regulation under, the Act. Under the Partnership Agreement and upon
Commission approval, from time to time through December 31, 1997, EEIC will
make additional capital contributions to Home & Family in an aggregate
amount of up to $3,900,000, in exchange for which EEIC's capital interest
in Home & Family will increase correspondingly. The making of additional
capital contributions after December 31, 1997 would require a renewal of
Commission authorization.
According to the terms of the Form of Partnership Agreement, quarterly
cash distributions shall be made to the partners of Home & Family in
proportion to their respective percentage profits interests in Home &
Family to the extent of available cash after maintenance of cash reserves
sufficient to meet Home & Family's ordinary working capital requirements.
Until EEIC has received cash distributions equal to one and one-half times
its actual total expenditures under the Research and Development Agreement
and investments in Home & Family (the "Conversion Date"), profits
distributions from Home & Family will be made 70% to EEIC and 30% to H&F
LP. From and after the Conversion Date, the partners' interests in profits
distributions will be adjusted so that EEIC will have a 65% interest and
H&F LP will have a 35% interest.
E. EEIC Loans/Advances. Upon Commission authorization, from time to
time through December 31, 1997 EEIC may also, at its discretion, provide
Home & Family with a working capital line of credit with a maximum
availability of three million dollars ($3,000,000), at an annual interest
rate equal to the base lending rate of The First National Bank of Boston,
N.A., plus 2 percent, for a term of three years. All such loans and
advances will be secured by all Home & Family assets, and will be used by
Home & Family exclusively for its working capital needs.
III. Analysis.
A. Precedent. For the reasons set forth in A.(i) through A.(iv)
below, the Applicant believes that the transactions proposed in this
Application-Declaration satisfy the criteria set forth by the Commission in
CSW Credit, Inc., Release No. 35-25995 (March 2, 1994), as further
elucidated and approved by the Commission in Southern Company, Release No.
35-26211 (December 30, 1994), and Eastern Utilities Associates, Release No.
35-26232 (February 15, 1995).
(i) Demand side management and energy management services ("DSM/EMS")
such as those currently being offered to consumers by certain of
the EUA System companies including EUA Cogenex Corporation have
been found by the Commission to be "closely related to the core
business of the utility." Eastern Utilities Associates Release
No. 35-26232 at page 8. The Applicant asserts that the home
environmental audit and environmental remediation services to be
offered by the proposed Home & Family will complement the EUA
System's DSM/EMS expertise and allow the Applicant and EUA
Cogenex Corporation to further refine and enhance the
effectiveness of their DSM/EMS activities. For example,
integrated solutions for the remediation of energy and
environmental problems existing in the home, such as how to
diminish the effects of electromagnetic fields, elevated levels
of radon or PCBs, would include determining an optimal balance of
energy efficiency and safety measures in light of a given
customer's needs. The Commission's guidelines pursuant to
Section 11 of the Act permit the acquisition of an interest "in
any other business which the Commission finds 'necessary or
appropriate in the public interest or for the protection of
investors or consumers and not detrimental to the proper
functioning of such system.' See Southern Company, Release No.
35-26211 at pages 13-14. Accordingly, the Applicant believes
that the proposed home environmental audit and remediation
services fit within the Commission's guidelines as being
"necessary or appropriate in the public interest or for the
protection of investors or consumers."
(ii) EEIC's investment in the proposed transactions is de minimis in
relation to the EUA System's total financial resources, with the
proposed contributions of $6 million representing only 1.1% of
the EUA System's gross revenues. Furthermore, the proposed
working capital loans and advances of up to $3 million represent
less than 2.3% of the EUA System's available lines of credit.
(iii) The Applicant asserts that the proposed home environmental audit
and remediation services will not be detrimental to the proper
functioning of the EUA System because: (a) EEIC's total proposed
investment is capped at less than $10 million; (b) EEIC's
proposed loans and advances for Home & Family's working capital
needs will be secured only by the assets of Home & Family;
(c) the proposed transactions are structured using a to-be-formed
subsidiary of EEIC in order to insulate other EUA System
companies from the acts and omissions of Home & Family; and
(d) no EUA System company will seek recovery from System utility
customers for potential future losses of Home & Family or
possible inadequate returns on capital invested by EEIC.
(iv) The Applicant, the EUA System and its investors will benefit from
(a) the integration of the EUA System's energy services and
federal environmental policy, (b) utilization of EUA's in-house
technical skills used in dealing with environmental rules and
regulations, and (c) the potential profitability of the Business
Opportunity, all as discussed in further detail in Sections III.B
through III.D below.
B. Integration of the Business Opportunity with Current EUA System
Audits and Services. EEIC's proposed investment in Home & Family dovetails
with the DSM/EMS businesses of the EUA System companies and more
particularly, with the residential home energy audits currently provided by
the EUA System operating companies to their customers in Massachusetts and
Rhode Island through the Mass Save and RISE programs. Because energy and
environmental audit services involve related activities, compartmentalizing
them makes each less effective and valuable. For example, a stand alone
energy audit might suggest that a home owner should seal up all air leaks
in order to reduce heat loss. Conversely, a stand alone environmental
audit of the same home might suggest that the number of air changes needs
to be increased in order to reduce airborne contaminants to safe levels.
There are many other instances where environmental and energy conservation
goals must be balanced. For example, there is overlap in the selection of
appropriate insulating materials and refrigerants for a customer because
some materials perform well with respect to energy savings but poorly from
a health and/or environmental perspective. The attached Exhibit G-1 shows
the correlation of energy and environmental audit activities and functions.
In addition to the anticipated benefits to EEIC of investing in the
Business Opportunity, the Applicant expects to garner benefits for the
entire EUA System including, among others, (i) the ability to provide
integrated environmental and energy conservation programs to System
customers; and (ii) the ability to utilize EUA's technical expertise in
environmental regulation, developed in response to changing environmental
rules and regulations in the electric industry, for non-core business
opportunities.
C. Integration of Energy Services and Environmental Policy. Major
regulatory initiatives including the Federal Clean Air Act of 1990, the
Federal Sentencing Guidelines of 1991, and the draft Federal Environmental
Sentencing Guidelines have caused most utility companies to establish
mandatory, proactive environmental programs. While utilities have been
viewed traditionally as reluctant participants in the environmental cleanup
process, more of them are now using experience gained in complying with
environmental regulations to develop national environmental consulting
practices. For example, Southwestern Electric Power Company, a wholly-
owned electric public utility subsidiary of Central and South West
Corporation, a registered holding company, recently received an extension
of its authorization to sell environmental laboratory services, including
analyses of water, oil, soils and waste characterization, to nonaffiliates.
See Release No. 35-26188 dated December 16, 1994 (File No. 70-8123). The
Applicant believes that environmental consulting services can complement
energy management and power production and boost a company's image as a
good corporate citizen with regulators and the community.
D. Utilization of EUA's Environmental Management Expertise.
Because of the nature of the EUA System's business, various by-products and
substances are produced or handled which are classified as hazardous under
the rules and regulations of the Environmental Protection Agency (the
"EPA") as well as state and local authorities. Dealing with these
environmental rules and regulations has become a full time responsibility
for EUA, as it has with most utility companies.
In order to be in compliance with ever changing environmental laws and
regulations and in an effort to support environmental research, EUA has
established the following internal strategic initiatives:
- Develop an environmental management team as part of EUA System
engineering.
- Include environmental goals and objectives in EUA's strategic
business plan.
- Develop and issue environmental policy statements, auditing
programs and compliance program policies and procedures.
- Be proactive in internal and external communications on
environmental issues.
- Monitor research initiatives and provide targeted funding.
EUA can make greater use of its existing environmental management team
by utilizing their technical knowledge and expertise in non-core business
opportunities. Technical support that could be provided specifically to
Home & Family by EUA would include quality control, auditor training,
evaluation of equipment and on-site audit procedures, customer service and
field support.
Technical support provided by EUA's environmental management team
would benefit Home & Family by providing it the environmental expertise
required to develop Home & Family's home audit program. EUA's core
customers would also benefit by: (i) having a portion of the cost of EUA's
environmental management be allocated to a non-core business; and (ii)
receiving the benefit of integrated environmental and energy audits.
Additionally, the work involved in making Home & Family a leader in
environmental services would provide EUA the opportunity to work more
closely with the EPA and other state regulatory agencies in the formulation
of new environmental standards and guidelines.
IV. Proposed Activities and/or Transactions.
A. Request for Authorization of Formation and Capitalization of the
EEIC Subsidiary. The Applicant hereby requests authorization to form the
EEIC Subsidiary and to contribute the Proprietary Technology to such EEIC
Subsidiary in consideration for the issuance by the EEIC Subsidiary to EEIC
of 100 shares of it common stock, $.01 par value per share.
B. Requests For Authorization to Finance and to Participate in Home
& Family. The Applicant, for itself and for the proposed EEIC Subsidiary,
requests Commission authorization through December 31, 1995 to contribute
the Proprietary Materials to Home & Family in consideration for the receipt
of the general partnership interest in Home & Family described above. In
addition, the Applicant requests approval from time to time through
December 31, 1997 (i) to make additional capital contributions to Home &
Family in an aggregate amount of up to $3,900,000, and (ii) at EEIC's sole
discretion, to provide additional funds for Home & Family's working capital
needs in an aggregate total amount of up to $3,000,000, all upon the terms
and conditions described in this Application-Declaration.
C. Services Provided By System Companies. Home & Family will have
its own employees, including Bruce M. McCarthy and B. Meade McCarthy, Jr.,
and others as necessary. Any activities that EEIC needs to perform under
the Agreement to Form Joint Venture or the Partnership Agreement would be
accomplished by employees of EUA Service. EUA Service may provide
management services including but not limited to financial, accounting,
environmental, data processing and records management services, as
appropriate, to Home & Family. All such services would be rendered at cost
pursuant to the standard Service Contract entered into between EUA Service
and the other EUA System companies. No employees of the EUA System's
retail electric utilities will be assigned to any activities involving Home
& Family. The Applicant does not anticipate the need to hire any
additional personnel in connection with EEIC's participation in Home &
Family.
D. Quarterly Reports to be filed with the Commission. EEIC will
file quarterly reports with the Commission within ninety (90) days of the
end of each calendar quarter. These reports will include the following
information:
(1) A description of Home & Family's activities;
(2) A statement of the amount of funds invested and open account
advances made by EEIC in and to Home & Family during the quarter and
cumulative to date;
(3) A description of the services provided by EUA Service, if any,
during the quarter and the type and number of personnel assigned by EUA
Service to achieve the reported activities;
(4) Financial statements including a balance sheet of Home & Family
as of the quarterly reporting date, an income statement for the quarter
reporting, and a statement of cash flow.
Neither EEIC nor any subsidiary thereof has acquired an ownership
interest in any exempt wholesale generator ("EWG") or a foreign utility
company ("FUCO") as defined in Sections 32 and 33 of the Act, or now is or
as a consequence of the transactions proposed herein will become a party to
or has or will as a consequence of the transactions proposed herein have
any right under a service, sales or construction contract with an EWG or
FUCO, except in accordance with the provisions of the Act.
ITEM 2. FEES, COMMISSIONS, AND EXPENSES.
The fees, commissions and expenses of the Applicants expected to be
paid or incurred, directly or indirectly, in connection with the
transaction described above are estimated as follows:
Securities and Exchange Commission Fees $ 2,000
Legal Fees $________*
Miscellaneous $________*
TOTAL $________*
* To be filed by amendment.
ITEM 3. APPLICABLE STATUTORY PROVISIONS.
The sections of the Act and rules or exemptions thereunder that the
applicants consider applicable to the transactions for the basis for
exemption therefrom are set forth below:
Issuance and sale by the EEIC Sections 6(a) and 7 and
Subsidiary to EEIC of the common Rule 43(a).
stock of the EEIC Subsidiary.
Purchase by EEIC of the shares Sections 9(a), 10 and 12(b);
of common stock of the EEIC Rule 45(a).
Subsidiary.
Purchase of general partnership Sections 9(a) and 10.
interest in Home & Family.
Capital contributions, loans and Section 12; Rule 45(a).
open account advances by EEIC to
Home & Family.
Performance of services by Section 13(b); Rules
EUA Service Corp. for Home & Family. 87(b)(1), 90 and 91.
ITEM 4. REGULATORY APPROVALS.
No consent or approval of any state commission or any federal
commission other than the Commission is necessary for the transactions
which are the subject of this Application/Declaration.
ITEM 5. PROCEDURE.
(a) In order to enable the Applicant to enter into the proposed
transactions promptly, the Applicant hereby requests that this
Application/Declaration be granted and made effective at the earliest
convenient date.
(b) It is not considered necessary that there be a recommended
decision by a hearing officer or by any other responsible office of the
Commission. The Office of Public Utility 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.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS
(* To be filed by amendment.)
(a) Exhibits (filed herewith).
* Exhibit A-1 Form of Articles of Organization of the
EEIC Subsidiary
* Exhibit A-2 Form of By-Laws of the EEIC Subsidiary
* Exhibit A-3 Form of Agreement of Limited
Partnership of Home & Family
Limited Partnership
* Exhibit B-1 Research and Development Agreement dated
September 26, 1994, as amended by
Amendment No. 1 thereto dated February
22, 1995
* Exhibit B-2 Agreement to Form Joint Venture
* Exhibit B-3 Terms and Conditions of Royalty-Free
License
* Exhibit F Opinion of Counsel
Exhibit G Correlation of Environmental and
Energy Audit Activities
Exhibit H Proposed Form of Notice
ITEM 7. INFORMATION AS TO ENVIRONMENTAL EFFECTS.
The transactions described in Item 1 do not involve major federal
actions significantly affecting the quality of the human environment. No
federal agency has prepared or is preparing an environmental impact
statement with respect to the proposed transaction.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned Applicant has duly caused this statement to be
signed on its behalf by the undersigned duly authorized individual.
EUA ENERGY INVESTMENT CORPORATION
By: /s/ Clifford J. Hebert, Jr.
Clifford J. Hebert, Jr.
Treasurer
Dated: March 9, 1995
EXHIBIT G
CORRELATION OF ENVIRONMENTAL AND ENERGY AUDIT ACTIVITIES
ENVIRONMENTAL CONCERN ENERGY AUDIT ACTIVITY
FORMALDEHYDE - Chemical used in foam Mass Save insulation test
insulation. It can cause of walls, basement, attic,
irritation of the nose, throat, floors, pipes and crawl space.
lungs and sinuses.
CARBON MONOXIDE - Poisonous gas Mass Save test of gas space
produced by gasoline engines, heaters, gas stoves and
improperly operating furnaces, home heating system.
fireplaces, kerosene heaters,
gas stoves, wood stoves and
other fuel-burning appliances.
It can cause headache, nausea,
fatigue, sleepiness and even
death.
MICROWAVE AND EMF RADIATION - Leaking Mass Save test of home
microwave ovens and electric and electric appliances.
magnetic fields from electric
appliances. Health hazards yet
to be confirmed, possible links
to cancer.
ASBESTOS - A mineral fiber used in Mass Save insulation test and
fire-resistant materials such test of home heating system
as furnace, pipe and duct insulation. and domestic hot water.
Exposure to airborne asbestos fibers
can cause lung damage and even lung
cancer.
LEAD PAINT - Highly toxic metal found Mass Save test of windows
in older paint, in some ceramic and home heating system.
glazes, in leaded crystal and in
plumbing.
LEAKING FUEL STORAGE TANKS - Leaking Mass Save test of home
tanks may be found in homes which heating system.
are (or were at one time) heated
by fuel oil. Leaking tanks can
contaminate soil and groundwater
with petroleum and can release
toxic fumes in the home.
Exhibit H
(PROPOSED FORM OF NOTICE)
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35 -, 70 -)
EUA Energy Investment Corporation ("EEIC"), a wholly-owned subsidiary
of Eastern Utilities Associates, a registered holding company, filed an
application-declaration with this Commission pursuant to Sections 6, 7,
9(a), 10, 12 and 13(b) of the Public Utility Holding Company Act of 1935
(the "Act") and Rules 43(a), 45(a), 87(b)(1), 90 and 91 promulgated
thereunder.
EEIC has requested Commission approval to incorporate a Massachusetts
business corporation (the "EEIC Subsidiary") to participate as the general
partner of a proposed joint venture limited partnership to be formed under
Massachusetts law (such proposed joint venture hereinafter referred to as
"Home & Family") for the purpose of developing and commercializing a home
environmental audit and environmental remediation business including, but
not limited to, home environmental testing of soil, air, water and
substances found in or about the home and the remediation of home
environmental problems. To complement the energy audit services that
various EUA System companies now offer to their customers, EEIC, together
with Home & Family Limited Partnership, a Massachusetts limited partnership
("H&F LP"), and pursuant to the Commission's order allowing EEIC to engage
in certain research and development activities (Release No. 35-24515 dated
December 4, 1987, as amended by Release No. 35-26028 dated April 15, 1994),
is developing certain proprietary materials (the "Proprietary Materials").
Upon Commission authorization and subject to EEIC's discretion, EEIC will
contribute such Proprietary Materials to the EEIC Subsidiary in exchange
for capital stock in the EEIC Subsidiary. No other person or entity will
own stock in the EEIC Subsidiary.
EEIC, for itself and for the proposed EEIC Subsidiary, has requested
Commission authorization through December 31, 1995 to contribute the
Proprietary Materials to Home & Family in consideration for the receipt of
the general partnership interest in Home & Family described above. In
addition, EEIC has requested for approval from time to time through
December 31, 1997 (i) to make additional capital contributions to Home &
Family in an aggregate amount of up to $3,900,000, and (ii) at EEIC's sole
discretion, to provide additional funds for Home & Family's working capital
needs in an aggregate total amount of up to $3,000,000, all upon the terms
and conditions described in the Application-Declaration.
NOTICE IS FURTHER GIVEN that any interested person may, not later than
April __, 1995, request in writing that a hearing be held on such matter,
stating the nature of his interest, the reasons for such request, and the
issues of fact or law raised by said application/declaration which he
desires to controvert; or he may request that he be notified if the
Commission should order a hearing thereon. Any such request should be
addressed: Secretary, Securities and Exchange Commission, 450 5th Street,
N.W., Judiciary Plaza, Washington, D.C. 20549. A copy of such request
should be served personally or by mail upon the applicant/declarant at the
above-stated address and proof of service (by affidavit or, in case of an
attorney at law, by certificate) should be filed with the request. At any
time after said date the application/declaration, as filed or as it may be
amended, may be granted and permitted to become effective as provided in
Rule 23 of the General Rules and Regulations promulgated under the Act, or
the Commission may grant exemption from such rules as provided in Rules
20(a) and 100 thereof or take such other action as it may deem appropriate.
Persons who request a hearing or advice as to whether a hearing is ordered
will receive any notices and orders issued in this matter, including the
date of the hearing (if ordered) and any postponements thereof.
For the Commission, by the Division of Corporate Regulation, pursuant
to delegated authority.
Secretary
