File No. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
APPLICATION-DECLARATION WITH RESPECT TO FINANCING TO BE
MADE AVAILABLE BY EUA ENERGY INVESTMENT CORPORATION
FOR JOINT PROJECTS WITH A SOLID AND LIQUID MATERIALS
SEPARATION TECHNOLOGY COMPANY
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
EUA ENERGY INVESTMENT CORPORATION
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, Suite 1700
Boston, Massachusetts 02109
ITEM 1. DESCRIPTION OF PROPOSED TRANSACTIONS.
I. Overview.
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"), a Massachusetts corporation and a
wholly-owned subsidiary of Eastern Utilities Associates ("EUA"), a
Massachusetts voluntary association and a registered public utility holding
company under the Public Utility Holding Company Act of 1935 (the "Act"). EEIC
is sometimes hereinafter referred to as the "Applicant". The holding company
system of EUA is sometimes hereinafter referred to as the "EUA System".
B. Prior Authorizations.
(1) By orders dated December 4, 1987 and January 11, 1988
(Release Nos. 35-24515 and 24515A, respectively; File No. 70-7426), EEIC was
authorized, among other things, to conduct energy and energy conservation
research and to invest, directly or indirectly, in such activities.
(2) By Order dated June 6, 1996 (Release No. 35-26529; File
No. 70-8837 (the "June 6, 1996 Order")), EEIC was authorized to invest, through
December 31, 1998, approximately $4,000,000 to acquire approximately 1,052,630
shares of common stock of Separation Technologies, Inc., a Delaware corporation
having its principal office in Needham, Massachusetts ("STI"). STI is engaged
in the research, development, design, sale, installation, construction and
servicing of solid and liquid materials separation systems and facilities
including, without limitation, a system for economically separating unburned
carbon from coal (or fly) ash produced by utility generating plants. Using
STI's system, the resulting carbon potentially can be re-burned by the utility
and the processed ash can be sold as a cement substitute in the manufacture of
concrete.
(3) The June 6, 1996 Order also authorized EEIC, through
December 31, 1998, to make project financing available up to an aggregate
principal amount of $15 million for the installation and construction of STI
fly ash separation projects. Such financing by EEIC was authorized to be
provided through the entering by EEIC into joint arrangements with STI at
locations where STI equipment would be installed. EEIC's investment in these
utility locations was anticipated to range between $0.5 and $2.5 million per
installation. EEIC's investments in such projects with STI would take the form
of, without limitation, joint ventures, general partnerships, limited
partnerships, teaming agreements, royalties or other revenue sharing, special
purpose entities, loans and equity participations. The aggregate amount of
such project investments currently outstanding totals $2,875,000. Since the
issuance of the June 6, 1996 Order, EEIC has determined that in certain
circumstances, in stead of project investments, it may also be desirable to
make additional direct investments in STI. Such investments would take a
variety of forms, including without limitation, the purchase of additional
securities of STI, short and long term loans or open account advances.
C. Overview of Application. In this application-declaration, EEIC
seeks Commission approval, through December 31, 2002, to provide financial
assistance to STI in the form of project financing and direct investments in
STI, provided that the aggregate amount of such assistance outstanding at any
one time does not exceed an additional $15 million. EEIC proposes to provide
such project financing by entering into joint arrangements with STI at
locations where STI equipment will be installed. EEIC's investments in such
future projects with STI would take the form of, without limitation, joint
ventures, general partnerships, limited partnerships, teaming agreements,
royalties or other revenue sharing, special purpose entities, loans and equity
participations. EEIC's direct investments may take the form of the purchase of
additional securities of STI, short or long term loans, open account advances
or capital contributions.
II. Analysis.
The Commission has previously authorized EEIC to enter into financing
arrangements similar to those described in this application-declaration in an
aggregate amount of up to $15 million (See, the June 6, 1996 Order, which is
summarized above) and has also authorized another non-utility subsidiary of a
registered public utility holding company system to enter into financing
arrangements similar to the types described in this application-declaration in
an aggregate amount of up to $10 million (See, New England Electric System,
Release No. 35-26277; File No. 70-8475 (the "NEES Order")). For the same
reasons as were presented in the application-declaration which led to the
issuing of the June 6, 1996 Order, and the application-declaration which led to
the issuing of the NEES Order, EEIC believes that its request for authorization
to enter into financing arrangements as described herein meet the criteria set
forth by the Commission for such activity.
III. Proposed Activities and/or Transactions.
A. Request For Authorization of Financial Assistance. EEIC
requests Commission authorization to make available, at EEIC's discretion, an
aggregate total of up to $15 million of financial assistance to STI as
described above, such financial assistance to be negotiated upon commercially
reasonable terms as the parties may determine.
B. No Services to be Provided by System Companies. STI has its
own employees, and no employees of the EUA System retail electric utilities
will be assigned to perform services for STI. EEIC does not anticipate the
need to hire any additional personnel in connection with exercise of its
financing rights with respect to STI.
C. No Ownership Interests in EWGs or FUCOs. With the exception,
by virtue of EUA BIOTEN, Inc.'s partnership interest in BIOTEN Partnership
(See, Release No. 35-26314; File No. 70-8617), of EEIC's indirect ownership
interest in a commercial prototype plant (which will either be an EWG as
defined in Section 32 of the Act or a Qualified Facility within the meaning of
the Public Utility Regulatory Policies Act of 1978, as amended), neither EEIC
nor any subsidiary thereof has acquired an ownership interest in any EWG or
FUCO, 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. EEIC, for
itself and its subsidiaries, will not acquire any such interest or right
without first obtaining any necessary Commission authorization.
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 above are estimated as follows:
Securities and Exchange Commission Fees $ *
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
Applicant considers applicable to the transactions or the basis for exemption
therefrom are set forth below:
Provision of financial assistance Sections 6(a), 7, 9 and
to STI and STI projects 10; Rules 45(a) and 54.
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
officer 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.
*Exhibit F Opinion of Counsel
Exhibit H Proposed Form of Notice
*(b) Financial Statements.
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:
Name: Clifford J. Hebert, Jr.
Its: Treasurer
Dated: October 15, 1998
(PROPOSED FORM OF NOTICE)
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35 - , 70 - )
EUA Energy Investment Corporation ("EEIC"), a Massachusetts corporation
and a wholly-owned subsidiary of Eastern Utilities Associates, a Massachusetts
voluntary association and a registered public utility holding company under the
Public Utility Holding Company Act of 1935 (the "Act"), has filed an
application-declaration with this Commission pursuant to Sections 6(a), 7, 9
and 10 of the Act and Rules 45(a) and 54 promulgated thereunder.
In this application-declaration, EEIC seeks Commission approval,
through December 31, 2002, to provide financial assistance to Separation
Technologies, Inc., a Delaware corporation ("STI"), in the form of project
financing and direct investments in STI, provided that the aggregate amount of
such assistance outstanding at any one time does not exceed $15 million. EEIC
proposes to provide such project financing by entering into joint arrangements
with STI at locations where STI equipment w ill be installed. EEIC's
investments in such future projects with STI would take the form of, without
limitation, joint ventures, general partnerships, limited partnerships, teaming
agreements, royalties or other revenue sharing, special purpose entities, loans
and equity participations. EEIC's direct investments may take the form of the
purchase of additional securities of STI, short or long term loans, open
account advances or capital contributions.
NOTICE IS FURTHER GIVEN that any interested person may, not later than
__________________, 1998, 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 to:
Secretary, Securities and Exchange Commission, 450 Fifth 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 the 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 its delegated authority.
Secretary
