[Federal Register Volume 59, Number 227 (Monday, November 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-29215]


[Federal Register: November 28, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26163]


Filings Under the Public Utility Holding Company Act of 1935, as 
Amended (``Act'')

November 18, 1994.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendments thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by December 12, 1994, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 20549, and serve a copy on the relevant 
applicant(s) and/or declarant(s) at the address(es) specified below. 
Proof of service (by affidavit or, in case of an attorney at law, by 
certificate) should be filed with the request. Any request for hearing 
shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.

Holyoke Water Power Company (70-7495)

    Holyoke Water Power Company (``HWP''), One Canal Street, Holyoke, 
Massachusetts 01040, an electric utility subsidiary company of 
Northeast Utilities, a registered holding company, has filed a post-
effective amendment under Sections 6(a) and 7 of the Act and Rule 54 
thereunder to its declaration previously filed under Sections 6(a) and 
7 and Rule 50(a)(5) thereunder.
    By Commission order dated November 9, 1988 (HCAR No. 24742), HWP 
was authorized to finance certain pollution control facilities at its 
Mt. Tom Station (``Facilities''). The cost of acquiring, constructing 
and installing the Facilities was financed by HWP through its use of 
the net proceeds from the sale by the Industrial Development Finance 
Authority of the City of Holyoke, Massachusetts (``IDA'') of its 
pollution control revenue bonds (``Bonds'') in the principal amount of 
$8 million. The Bonds were issued pursuant to an Indenture of Trust 
between the IDA and Baybank Middlesex, as trustee (``Trustee''), and 
the proceeds of the issuance of the Bonds were loaned to HWP pursuant 
to a Loan Agreement (``Loan Agreement'') between HWP and the IDA.
    In order to obtain the benefits of a high quality rating for the 
Bonds, HWP's obligations under the Loan Agreement are secured by an 
irrevocable letter of credit (``Letter of Credit'') in the amount of 
$8,667,000 issued by Union Bank of Switzerland, New York Branch 
(``Bank'') in favor of the Trustee. The Letter of Credit secures $8 
million of principal amount plus interest in the amount of $667,000 at 
the maximum rate of 15% per annum for 218 days.
    HWP now proposes to amend the Reimbursement and Security Agreement, 
dated as of November 1, 1988 between HWP and the Bank in order to: (1) 
change the expiration date of the Letter of Credit, from perpetual to a 
three-year term ending November 1, 1997, extendible for successive one-
year terms thereafter during the term of the Loan Agreement, with the 
consent of HWP and the Bank; (2) reduce the annual Letter of Credit fee 
payable to the Bank; and (3) extend, modify or replace the Letter of 
Credit provided by the Bank, as permitted by the Loan Agreement, by 
delivery of a substitute credit facility, consisting of a new letter of 
credit, and related agreements, to be provided by a substitute bank to 
be chosen by HWP (``Substitute Bank'').
    The proposed Letter of Credit fee will be changed from 0.45% of the 
Letter of Credit amount to 0.40% of that amount. This represents an 
annual fee reduction of $4,334 per annum.
    HWP proposes to extend, modify or replace the Bank's Letter of 
Credit with a new letter of credit (``Substitute ``LOC'') to be issued 
by the same or a Substitute Bank during the term of the Bonds. The 
Substitute LOC would be issued under a new letter of credit and 
reimbursement agreement (``New LOC Agreement'') substantially identical 
to the Letter of Credit and Reimbursement Agreement, dated as of 
September 1, 1993 among HWP's associate company, The Connecticut Light 
& Power Company, Deutsche Bank AG, New York Branch and various co-
agents and participating banks, as approved by Commission order, dated 
September 15, 1993 (HCAR No. 25881). The New LOC Agreement will be in 
accordance with the Loan Agreement and provide that: (1) the total 
amount available to be drawn under any such extended, modified, or 
replacement letter of credit does not exceed $8,667,000; (2) the annual 
letter of credit costs applicable to any such extension, modification, 
or replacement do not exceed 1.00% per annum of the total amount 
available; (3) that tender advances bear interest until paid at a rate 
not to exceed the higher of (a) the prime rate plus 2.00% or (b) the 
federal funds rate plus 2.00%; (4) such extension, modification, or 
replacement is otherwise on terms that are substantially similar in all 
material respects to those applicable to the New LOC Agreement.

GPU Nuclear Corporation, et al. (70-8425)

    GPU Nuclear Corporation (``GPUN''), One Upper Pond Road, 
Parsippany, New Jersey, 07054, a public-utility subsidiary company of 
General Public Utilities Corporation (``GPU''), a registered holding 
company; Energy Initiatives, Inc. (``EII''), One Upper Pond Road, 
Parsippany, New Jersey, 07054, a nonutility subsidiary company of GPU; 
Jersey Central Power & Light Company (``JCP&L''), 300 Madison Avenue, 
Morristown, New Jersey, 07960, a public-utility subsidiary company of 
GPU; Metropolitan Edison Company (``Met Ed''), P.O. Box 16001, Reading, 
Pennsylvania, 19640; a public-utility subsidiary company of GPU; 
Pennsylvania Electric Company (``Penelec''), 1001 Broad Street, 
Johnstown, Pennsylvania, 15907, a public-utility subsidiary company of 
GPU; and GPU Service Corporation (``GPUS''), 100 Interpace Parkway, 
Parsippany, New Jersey, 07054, a nonutility subsidiary company of GPU, 
have filed a declaration under Section 13(b) of the Act and Rules 87, 
90 and 91 thereunder.
    GPUN proposes to perform a range of nonnuclear technical, training, 
management and consulting services (``Services'') for GPU Service, 
Initiatives, JCP&L, Met Ed, and Penn Elec (``GPU Companies''),\1\ which 
include: (1) plant operations and maintenance; (2) plant inspections 
and risk analysis; (3) plant equipment corrosion control and failure 
analysis; (4) engineering and design services; (5) plant life extension 
analysis; (6) project and construction management; (7) plant 
modification, design, installation, evaluation and testing; (8) 
environmental protection services; (9) emergency preparedness training 
and services; (10) quality assurance services; (11) training programs; 
(12) plant management consulting and operation analysis; (13) 
industrial safety and hygiene services; and (14) medical services.
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    \1\On April 5, 1994, GPU filed an application (File No. 70-8409) 
to form GPU Generation Corporation (``GPU Generation'') to operate, 
maintain and rehabilitate the non-nuclear generation facilities of 
the GPU Companies. GPUN proposes that when GPU Generation is 
authorized, GPUN also would provide services for it under the 
authorization requested herein.
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    GPUN intends to enter into a Non-Nuclear Technical, Training, 
Management and Consulting Services Agreement (``Agreement'') with the 
GPU Companies to provide the Services in connection with their business 
operations. The Agreement will be substantially in the form of the 
Laboratory Service Agreement previously filed (Exhibit A-4) in SEC File 
No. 70-7720.
    Schedule I to the Agreement describes the types of Services that 
GPUN intends to furnish to the GPU Companies. Schedule II to the 
Agreement, Determination of Cost of Service and Allocation Thereof, 
provides that any Services to be rendered by GPUN will be charged at 
cost pursuant to the Act and the regulations thereunder.
    Schedule II will also reflect the practice of (i) charging capital 
costs for providing Services to the serviced companies consistent with 
generally accepted accounting principles, and (ii) billing to the 
serviced company the costs of service before they are paid by GPUN, 
which is consistent with the practice that was approved by the 
Commission in its letter to GPUS dated June 3, 1982. Such costs will be 
accounted for and billed to the GPU Companies substantially as 
described in HCAR No. 25149 (Sept. 14, 1990).
    The GPU Companies believe that the technical, analytical and 
related expertise of GPUN can be usefully applied in support of their 
business activities. Providing the Services will not interfere with 
GPUN's primary responsibility of operating and maintaining nuclear 
generating facilities of behalf of those companies. The total level of 
Services GPUN will provide will not exceed ten percent of the level of 
primary nuclear services which it is currently providing to the GPU 
Companies.
    GPUN will, by May 1 each year, separately report to the Commission 
any revenues received from the performance of the Services on its 
annual report on Form U-13-60 filed under the Act.

American Electric Power Co., et al. (70-8429)

    American Electric Power Company, Inc. (``AEP''), 1 Riverside Plaza, 
Columbus, Ohio 43215, a registered holding company, and AEP Resources, 
Inc. (``Resources''), 1 Riverside Plaza, Columbus, Ohio 43215, a non-
utility subsidiary company of AEP, have filed an application-
declaration under Sections 6(a), 7, 9(a), 10, 12(b), 32 and 33 of the 
Act and Rules 45 and 53 thereunder.
    AEP and Resources propose to issue and sell up to $300 million in 
debt and/or equity securities through June 30, 1997 to invest in two 
types of power projects (``Power Projects'')--exempt wholesale 
generators (``EWGs'') and foreign utility companies (``FUCOs''). AEP 
and Resources also request approval to acquire the securities of one or 
more companies (``Project Parents'') that will directly or indirectly 
own and hold the securities of one or more FUCOs and EWGs.
    AEP proposes to guarantee the debt securities and other commitments 
of Resources, and AEP and Resources also propose to guarantee the 
securities of one or more Project Parents or Power Projects, and for 
Project Parents to guarantee the securities of their Power Projects, 
through June 30, 1997, in an aggregate amount which together with the 
securities will not exceed $300 million.
    With respect to AEP equity financing, AEP proposes to issue and 
sell up to 10 million additional shares (``Shares'') of its common 
stock, par value $6.50 per share, which are authorized but unissued or 
held by AEP, provided that the gross proceeds from such sale will not 
exceed $300 million. AEP proposes to effect the issuance and sale by 
competitive bidding, negotiations with underwriters or agents, or 
agents at market prices. The Commission is requested to reserve 
jurisdiction over the issuance and sale by AEP of the Shares pending 
completion of the record.
    With respect to long-term debt financing, AEP and Resources also 
request authorization to issue and sell through June 30, 1997 
promissory notes (``Long-term Notes'') in the aggregate principal 
amount of up to $300 million to one or more commercial banks, financial 
institutions or other institutions or other investors pursuant to one 
or more loan agreements (``Proposed Agreement''). The Proposed 
Agreement and the Long-term Notes thereunder would be for a term of not 
less than nine months nor more than twenty years.
    The Proposed Agreement would provide that the Long-term Notes bear 
interest at either a fixed rate, a fluctuating rate or some combination 
of fixed and fluctuating rates. Any fixed rate of interest of the Long-
term Notes will not be greater than 250 basis points above the yield at 
the time of issuance of the Long-term Notes of United States Treasury 
obligations (``Applicable Treasury Rate''). Any fluctuating rate will 
not be greater than 200 basis points above the rate of interest 
announced publicly by a major bank as its base or prime rate (``Prime 
Rate''). If the indebtedness is denominated in the currency of a 
country other than the United States, the fixed or floating rate, when 
adjusted for inflation in such country, will not be greater than 700 
basis points over the Applicable Treasury Rate or Prime Rate.
    With respect to short-term debt financing, AEP and Resources 
request authorization to incur such indebtedness through June 30, 1997 
through the issuance and sale of notes to banks and, in the case of 
AEP, commercial paper to dealers in commercial paper in an aggregate 
amount not to exceed $300 million. Borrowings under the lines of credit 
would generally bear interest at an annual rate not greater than the 
prime commercial rate in effect from time to time. The total annual 
cost of borrowings under all such bank lines is estimated to be not 
greater than the effective rate for borrowings bearing interest at the 
prime commercial rate with compensating balances of up to 10% of the 
line of credit. The effective annual interest cost under any of the 
above arrangements, assuming full use of the line of credit, will not 
exceed 125% of the prime commercial rate in effect from time to time, 
or not more than 10.625% on the basis of a prime commercial rate of 
8.50%.
    Commercial paper will be sold directly by AEP to dealers in 
commercial paper. The commercial paper will be in the form of 
promissory notes in denominations of not less than $50,000, and of 
varying maturities, with no maturity more than 270 days after the date 
of issue. Such notes will not be prepayable prior to maturity and will 
be sold at a discount rate not to excess of the discount rate per annum 
prevailing at the time of issuance for commercial paper of comparable 
quality and maturity.
    The application-declaration states that it may be necessary from 
time to time for AEP to guarantee certain indebtedness or other 
financial commitments of Resources, for AEP or Resources to guarantee 
certain indebtedness or financial commitments of a Project Parent or 
Power Project in which they may invest, or for a Project Parent to 
guarantee certain indebtedness or financial commitments of a FUCO or 
EWG in which it may invest. The terms and conditions of such guarantees 
would be negotiated in individual cases, would vary in duration, and 
may be contingent and conditional or absolute and unconditional. AEP 
and Resources request authority to issue, or have Project Parents 
issue, from time to time through June 30, 1997, up to $300 million in 
guarantees provided that any guarantee outstanding on June 30, 1997 
would expire or terminate in accordance with its terms.
    AEP will not sell any Shares and neither AEP nor Resources will 
incur any indebtedness or issue, or have a Project Parent issue, any 
guarantee if the gross proceeds of all Shares and the principal amount 
of all indebtedness and all guarantees authorized hereunder would 
exceed $300 million. AEP intends to use the net proceeds from the sale 
of the Shares or the short-term or long-term indebtedness to make 
additional investments in Resources and direct or indirect investments 
in Power Projects. Resources intends to use such funds from AEP and the 
net proceeds from any short-term or long-term indebtedness to make 
direct or indirect investments in Power Projects.
    Investments in Resources by AEP would be by acquisitions of common 
stock, capital contributions, open account advances and/or loans. Open 
account advances or loans would bear interest at a rate based on the 
cost of funds to AEP in effect on the date of issue. If AEP uses the 
proceeds of long-term indebtedness to fund such investment, then the 
interest rate will be the same as that of the term loan. If AEP uses 
the proceeds of short-term borrowings to fund such investment, then the 
cost of such funds will be the interest rate of short-term borrowings--
that is, would generally bear interest at an annual rate not greater 
than the prime commercial rate in effect from time to time.
    AEP and Resources request authority to make direct or indirect 
investments in Project Parents in an aggregate amount not to exceed 
$300 million. It is proposed that investments by AEP and Resources in 
any Project Parent may take the form of (i) purchases of capital 
shares, partnership interests, trust certificates, or the equivalent of 
any of the foregoing, (ii) open account advances or loans, and/or (iii) 
guarantees by AEP or Resources.
    Open account advances or loans to a Project Parent would bear 
interest at a rate based on cost of funds to AEP or Resources on the 
date of issue. Any open account advance or loan may be converted to a 
capital contribution to such Project Parent. Funds for any open account 
advances or loans by AEP or Resources in any Project Parent will be 
derived from the sale of common stock and/or the issuance of short-term 
and long-term indebtedness or guarantees and from available cash.
    Approval is requested for Project Parents to issue short-term and 
long-term indebtedness to persons other than AEP or Resources which 
would be guaranteed by AEP or Resources (``Recourse Debt''). Recourse 
Debt would be subject to the same terms and conditions as indebtedness 
of AEP and Resources. Approval is also requested for any Project Parent 
to issue equity securities and debt securities to persons other than 
AEP or Resources (``Non-Recourse Securities'') exclusively for the 
purpose of financing investments in Exempt Subsidiaries. It is proposed 
that the aggregate principal amount of non-recourse debt securities 
issued by Project Parents to persons other than AEP and Resources will 
not exceed $800 million provided that no more than $200 million 
principal amount may be denominated in currencies other than U.S. 
dollars.
    Equity securities issued by any Project Parent to a person other 
than AEP or Resources may include capital shares, partnership 
interests, trust certificates, or any of the foregoing. Non-recourse 
debt securities issued to persons other than AEP or Resources may 
include secured and unsecured promissory notes, subordinated notes, 
bonds, or other evidence of indebtedness. Securities issued by Project 
Parents may be denominated in either U.S. dollars or foreign 
currencies. The amount and type of such securities, and the terms 
thereof, including interest rate, maturity, prepayment or redemption 
privileges, and the terms of any collateral security granted with 
respect thereto, would be negotiated on a case by case basis.
    However, AEP and Resources state that any note, bond or other 
evidence of indebtedness issued or sold by any Project Parent will 
mature not later than 30 years from the date of issuance thereof, and 
will bear interest, if such note, bond or other indebtedness is U.S. 
dollar denominated, at a fixed rate not to exceed 6.5% over the 
Applicable Treasury Rate, or at a floating rate not to exceed 6.5% over 
the Prime Rate, and, if such note, bond or other indebtedness is 
denominated in the currency of a different country, will bear interest 
at a fixed or floating rate which, when adjusted for inflation in such 
country, will not exceed 10% over the Applicable Treasury Rate or Prime 
Rate.
    The application-declaration states that AEP will not sell any 
Shares, and neither AEP nor Resources will incur any indebtedness or 
issue, or have a Project Parent issue, any guarantee, if the gross 
proceeds of all outstanding Shares and the principal amount of all such 
outstanding indebtedness and all such outstanding guarantees authorized 
hereunder would exceed $300 million.

New England Electric System, et al. (70-8475)

    New England Electric System (``NEES''), a registered holding 
company, and New England Electric Resources, Inc. (``NEERI''), its 
wholly owned, nonutility subsidiary company, both of 25 Research Drive, 
Westborough, Massachusetts 01582, have filed an application-declaration 
under sections 6(a), 7, 9(a), 10 and 12(b) of the Act and rule 45 
thereunder.
    NEERI proposes to enter into a joint arrangement with Separation 
Technologies, Inc. (``STI''), the developer of a process for separating 
unburned carbon from coal ash. In connection with this joint 
arrangement, NEERI will be called on to invest in STI projects and to 
provide certain consulting services to STI. Applicants-declarants state 
that STI has developed a system of economically separating unburned 
carbon from coal (or fly) ash produced by utility generating plants. 
The separated carbon can be reburned by the utility. The processed ash 
can be sold as a cement substitute in the manufacture of concrete.
    As part of its joint arrangement with STI, NEERI proposes to enter 
into a project with STI involving the processing of coal ash at an 
electric generation facility in the New England/New York region (``NE/
NY Project'') owned by a nonaffiliated electric company (``Owner''). 
NEERI proposes to invest $700,000 in the NE/NY Project in return for a 
percentage of the NE/NY Project revenue stream. In addition, NEERI will 
provide to STI consulting services for a fee. STI will be responsible 
for processing the ash at the Owner's facility.
    NEERI proposes to enter into similar joint arrangements with STI at 
other locations where STI equipment will be installed. NEERI's 
investment in these other utility locations is anticipated to range 
between $0.5 and $2.0 million per installation. NEERI and STI also 
propose to perform research to further refine the carbon-rich and low 
carbon processed waste stream and to find other applications for the 
STI separation process in recycling.
    NEES proposes to provide additional financing to NEERI by making 
capital contributions up to an additional $11.7 million and/or by 
lending to NEERI from time to time additional amounts not to exceed 
$11.7 million at any one time, such loans to be in the form of non-
interest bearing subordinated notes. The aggregate amount of all 
investments (including amounts previously authorized by the Commission) 
by NEES in NEERI shall not exceed $13.95 million.

Louisiana Power & Light Company (70-8487)

    Louisiana Power & Light Company (``LP&L''), 639 Loyola Avenue, New 
Orleans, Louisiana 70113, an electric public-utility subsidiary company 
of Entergy Corporation, a registered holding company, has filed an 
application-declaration under Sections 6(a), 7, 9(a), and 10 of the Act 
and Rule 54 thereunder.
    LP&L proposes to issue and sell up to an aggregate principal amount 
of $565 million its first mortgage bonds (``Bonds'') to be issued and 
sold in one or more new series from January 1, 1995 through December 
31, 1996. Each series of Bonds will be sold at such price, will bear 
interest at such rate and will mature on such date as will be 
determined at the time of sale. One or more series of Bonds may include 
provisions for redemption or retirement prior to maturity, including 
restrictions on optional redemption for a given number of years. LP&P 
may determine to provide an insurance policy for the payment of the 
principal of and/or interest and/or premium on one or more series of 
Bonds.
    LP&L further proposes to issue and sell, from January 1, 1995 
through December 31, 1996, one or more new series of its preferred 
stock, cumulative, of either $25 par value or $100 par value 
(collectively, the ``Preferred''). The total aggregate par value of 
shares of those new series of the Preferred issued will be up to an 
aggregate principal amount of $110 million. The price, exclusive of 
accumulated dividends, and the dividend rate for each series of 
Preferred will be determined at the time of sale. LP&L may determine 
that the terms of the Preferred should provide for an adjustable 
dividend rate thereon to be determined on a periodic basis, subject to 
specified maximum and minimum rates, rather than a fixed dividend rate. 
The terms of one or more series of the Preferred may include provisions 
for redemption, including restrictions on optional redemption, and/or a 
sinking fund designed to redeem all outstanding shares of such series 
not later than thirty years after the date of original issuance.
    LP&L proposes to use the net proceeds derived from the issuance and 
sale of Bonds and/or the Preferred for general corporate purposes, 
including, but not limited to, the possible acquisition of certain 
outstanding securities. LP&L states that it presently contemplates 
selling the Bonds and the Preferred either by competitive bidding, 
negotiated public offering or private placement.
    LP&L also proposes to enter into arrangements to finance on a tax-
exempt basis certain solid waste, sewage disposal and/or pollution 
control facilities (``Facilities'') at Unit No. 3 of its Waterford 
Steam Electric Generating Station in the Parish of St. Charles, 
Louisiana (``Parish''). LP&L proposes, from time to time through 
December 31, 1996, to enter into one or more installment sale 
agreements and supplements (``Agreement''), pursuant to which the 
Parish may issue one or more series of tax-exempt revenue bonds (``Tax-
Exempt Bonds'') up to an aggregate principal amount of $65 million. The 
net proceeds from the sale of Tax-Exempt Bonds will be deposited by the 
Parish with the trustee (``Trustee'') under one or more indentures 
(``Indenture'') and will be applied by the Trustee to reimburse the 
Company for, or to permanently finance or refinance on a tax-exempt 
basis, the costs of the acquisition, construction, installation or 
equipping of the Facilities.
    LP&L further proposes, under the Agreement, to sell the Facilities 
to the Parish for cash and simultaneously repurchase the Facilities 
from the Parish for a purchase price, payable on an installment basis 
over a period of years, sufficient to pay the principal of, purchase 
price of, the premium, if any, and the interest on Tax-Exempt Bonds as 
the same become due and payable. Under the Agreement, LP&L will also be 
obligated to pay certain fees incurred in the transactions.
    The price to be paid to the Parish for each series of Tax-Exempt 
Bonds and the interest rate applicable thereto will be determined at 
the time of sale. The Agreement and the Indenture will provide for 
either a fixed interest rate or an adjustable interest rate for each 
series of the Tax-Exempt Bonds. Each series may be subject to optional 
and mandatory redemption and/or a mandatory cash sinking fund under 
which stated portions of such series would be retired at stated times.
    In order to obtain a more favorable rating and thereby improve the 
marketability of the Tax-Exempt Bonds, LP&L may: (1) arrange for a 
letter of credit from a bank (``Bank'') in favor of the Trustee (in 
connection therewith, LP&L may enter into a Reimbursement Agreement 
pursuant to which LP&L would agree to reimburse the Bank for amounts 
drawn under the letter of credit and to pay commitment and/or letter of 
credit fees); (2) provide an insurance policy for the payment of the 
principal of and/or interest and/or premium on one or more series of 
Tax-Exempt Bonds; and/or (3) obtain authentication of one or more new 
series of First Mortgage Bonds (``Collateral Bonds'') to be issued 
under LP&L's Mortgage on the basis of unfunded net property additions 
and/or previously retired First Mortgage Bonds and delivered to the 
Trustee and/or the Bank to evidence and secure LP&L's obligations under 
the Agreement and/or the Reimbursement Agreement, respectively.

Allegheny Power System, Inc., et al. (70-8491)

    Allegheny Power System, Inc. (``Allegheny''), a registered holding 
company, and AYP Capital, Inc. (``AYP Capital''), its wholly owned 
nonutility subsidiary, both of 12 East 49th Street, New York, New York 
10017, have filed an application-declaration under sections 6(a), 7, 
9(a) and 10 of the Act and rule 45(a) thereunder.
    Allegheny proposes to invest in AYP Capital up to $5 million in the 
form of cash contributions from time to time through December 31, 2002. 
This money will fund AYP Capital's proposed acquisition, as a limited 
partner of up to 10% of the interests of all limited partners in 
Envirotech Investment Fund I Limited Partnership, a Delaware limited 
partnership (``Envirotech Partnership''). In no event shall AYP 
Capital's investment be more than $5 million.
    The sole general partner of the Envirotech Partnership (``General 
Partner'') will be Advent International Limited Partnership, a Delaware 
limited partnership of which Advent International Corporation (``AIC'') 
is the general partner. A key objective of the Envirotech Partnership 
is to make investments that will contribute to the reduction, avoidance 
or sequestering of greenhouse gas emissions; help utilities and their 
customers handle waste by-products more effectively or produce or 
manufacture goods or services more cost effectively; improve the 
efficiency of the production, storage, transmission, and delivery of 
energy; and provide investors with attractive opportunities relating to 
the evolving utility business climate which meet the above objectives.
    In selecting suitable investments, the Envirotech Partnership will 
focus on the following technology sectors, among others: alternate and 
renewable energy technologies; environmental and waste treatment 
technologies and services; energy efficiency technologies, processes 
and services; electrotechnologies used in the reduction of medical 
waste; technologies and processes promoting alternative energy for 
transportation; and other technologies related to improving the 
generation, transmission and delivery of electricity.
    The term of Envirotech Partnership shall be for 10 years from the 
date of the partnership agreement, subject to extension for up to two 
years upon agreement of the General Partner and limited partners 
holding 66\2/3\% of the combined capital contributions of all limited 
partners. Subject to certain limitations set forth in the partnership 
agreement, the management, operation, and implementation of policy of 
the Envirotech Partnership will be vested exclusively in the General 
Partner. Among other powers, the General Partner shall have discretion 
to invest the Partnership's fund in accordance with investment 
guidelines set forth in the charter. The investment guidelines may be 
amended or modified only upon the affirmative vote of limited partners 
representing at least 75% of the commitments of all limited partners.
    Under the terms of the partnership agreement the General Partner 
will be paid an annual management fee equal to 2\1/2\% of the total 
amount of the capital commitments of the partners through the first six 
(6) years, thereafter declining by \1/4\ of 1% on each anniversary to 
1.5% commencing on the ninth anniversary date. In addition, the General 
Partner shall be entitled to reimbursement for all reasonable expenses 
incurred in the organization of the Envirotech Partnership up to 
$195,000, and for other third party expenses incurred on behalf of the 
Envirotech Partnership.
    All Envirotech Partnership income and losses (including income and 
losses deemed to have been realized when securities are distributed in 
kind) will generally be allocated 80% to and among the limited partners 
and 20% to the General Partner. One hundred percent (100%) of all cash 
distributions to the partners shall be made first to the limited 
partners until such time as the limited partners shall have received 
aggregate distributions equal to the aggregate of their respective 
capital contributions, and thereafter 20% to the General Partner and 
80% to the limited partners. Distributions in kind of the securities of 
Portfolio Companies that are listed on or otherwise traded in a 
recognized over-the-counter or unlisted securities market may be made 
at the option of the General Partner.

Entergy Corporation (70-8509)

    Entergy Corporation (``Entergy''), 225 Baronne Street, New Orleans, 
Louisiana 70112, a registered holding company, and its wholly owned 
nonutility subsidiary companies, Entergy Enterprises, Inc., 
(``Enterprises''), Three Financial Centre, 900 South Shackleford Road, 
Suite 210, Little Rock, Arkansas 72211, and Entergy Systems and 
Service, Inc. (``Entergy SASI''), 4740 Shelby Drive, Suite 105, 
Memphis, Tennessee 38118, (collectively, ``Applicants''), have filed an 
application-declaration under sections 6(a), 7, 9(a), 10 and 12(b) of 
the Act and rules 45 and 54 thereunder.
    Pursuant to Commission order dated December 28, 1992 (HCAR No. 
25718), Entergy SASI was organized as a wholly owned subsidiary of 
Enterprises that would provide energy management services to 
commercial, industrial and institutional customers. Such order 
authorized Entergy SASI to provide energy management services, without 
limitation, to customers within a region consisting of the states of 
Arkansas, Louisiana and Mississippi; and the service territories of 
utilities from which the Entergy system could expect to purchase 
economy, replacement and emergency energy (``Base Region''). The order 
also permitted Entergy SASI to solicit and serve customers outside the 
Base Region to a limited extent and subject to the condition that at 
least 50% of Entergy SASI's annual revenues be derived from its 
activities within the Base Region (``50% Revenue Restriction'').
    The Applicants now seek additional authorization for Entergy SASI 
to provide consulting services related to energy management and demand-
side management (``DSM'') activities. Such consulting services would 
generally be limited to the rendering of advice, know-how and 
management/technical services for a consulting fee in order to assist 
energy customers, utilities, federal, state and foreign government 
entities and other customers with energy management and/or DSM 
activities in cases where Entergy SASI is not directly involved in the 
performance of such energy management and/or DSM services. Entergy SASI 
proposes to provide such consulting servies on a worldwide basis and 
that associated revenues not be subject to the 50% Revenue Restriction.
    Specifically, Entergy SASI's consulting services would include the 
following: (1) development and review of architectural, structural and 
engineering drawings for energy and other resource efficiency; (2) 
design and specification of energy consuming or conservation equipment, 
controls and systems; (3) design and marketing of intellectual 
property, i.e. any process, program, technique, or computer software 
used to analyze energy conservation opportunities and results; (4) 
general technical advice concerning the use, benefits, planning and/or 
administration of energy management and/or DSM programs; and (5) 
general management advice and services relating to the implementation 
of functions, practices and procedures incidental to the conduct of the 
energy management services business and/or DSM programs.
    In addition, Entergy SASI proposes to provide funding to other 
energy management and DSM contractors to enable them to carry out 
energy conservation measures. Although the precise terms of such 
funding arrangements will not be determined until the time of the 
applicable transactions, it is anticipated that Entergy SASI will be 
repaid through assignments of a portion of the monthly fees paid by 
customers under contracts relating to the installation of such energy 
conservation measures. The Applicants state that the proposed funding 
arrangements will not involve the acquisition by Entergy SASI of any 
promissory notes.
    Finally, the Applicants request authorization for: (1) Entergy to 
make additional investments in Enterprises of up to an aggregate amount 
of $100 million from time to time through December 31, 1997, with such 
investments to be made through any combination of purchases of 
Enterprises' common stock and/or capital contributions to Enterprises; 
(2) Enterprises to use the proceeds of such transactions to make 
additional investments in Entergy SASI (in the form of equity 
investments and/or loans) of up to $100 million from time to time 
through December 31, 1997; and (3) Entergy SASI to issue and sell to 
nonaffiliated third parties during the same period up to $100 million 
of commercial paper, promissory notes and/or other debt securities, 
secured or unsecured (collectively, the ``Debt Securities).
    It is proposed that the proceeds derived from Enterprises' 
investments, as well as any third party financing, be used by Entergy 
SASI for the following purposes: (1) to repay its existing indebtedness 
under notes issued to Entergy; (2) to provide financing for customer 
contracts and funding for the implementation of energy conservation 
measures by other energy management and DSM contractors; and (3) to 
provide Entergy with necessary working capital in connection with its 
ongoing energy management, consulting and other authorized businesses, 
as well as to pay for general and administrative expenses and to 
provide for Entergy SASI's other capital needs.
    Any loans made by Enterprises to Entergy SASI would be evidenced by 
promissory notes bearing an interest rate to be determined at the time 
of borrowing (but in no event greater than the then prevailing prime 
rate, as reported by the Wall Street Journal) and maturing no later 
than ten years from the date of borrowing. Where Debt Securities issued 
to nonaffiliates are involved, the yield to maturity of such Debt 
Securities would not exceed the then current yield to maturity on U.S. 
Treasury securities of comparable maturities (subject to straight line 
interpolation when there is no comparable U.S. Treasury security), plus 
400 basis points, and no Debt Securities would be issued for a term of 
greater than thirty years. It is further proposed that any notes issued 
by Entergy SASI to Enterprises may, at the option of Enterprises, be 
converted to capital contributions to Entergy SASI by the forgiveness 
of the debt represented thereby.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. 94-29215 Filed 11-25-94; 8:45 am]
BILLING CODE 8010-01-M