EXHIBIT A TO FORM U-3A-2
THE CATALYST GROUP, INC. & SUBSIDIARIES
DECEMBER 31, 1997
ANNUAL FINANCIAL STATEMENTS
(UNAUDITED)
<TABLE>
THE CATALYST GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
Unaudited
<CAPTION>
December 31, December 31,
1996 1997
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 2,884 $ 3,271
CORHLP management fee receivable 4,996 3,656
Investments 152,448 140,111
UTC escrow reserve 6,500 6,861
Note receivable - Carena 25,800 25,800
Other assets 822 2,947
--------- ---------
Total assets $ 193,450 $ 182,646
LIABILITIES AND STOCKHOLDERS' EQUITY
Note to Springerville OP's $ - $1,267
Note payable -Trigen 400 -
Note payable - Great Lakes Power 772 728
Senior note pay-Trilon International 16,254 15,581
Junior note pay-First Toronto Equities 116,075 105,417
Accounts payable and accrued expenses 2,315 2,463
Deferred income taxes 7,913 3,509
--------- ---------
Total liabilities 143,729 128,965
Senior Participating Preferred Stock
$.01 PV; 500,000 shares authorized,
134,000 issued and outstanding 1 1
Junior Participating Preferred Stock
$.01 PV; 500,000 shares authorized,
65,000 issued and outstanding 1 1
Common Stock-$.01 PV;
100,000 sharesauthorized,issued and outstanding 1
1Additional paid-in capital 199,997 199,997
Accumulated deficiency (150,279) (146,319)
Total stockholders'equity 49,721 53,681
Total liabilities and ---------- ----------
stockholders'equity $ 193,450 $ 182,646
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THE CATALYST GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31,1997
<CAPTION>
(In thousands)
<S> <C>
Operating revenues:
------------------
Equity interest in operating results of CORHLP $12,474
Management fee income 1,731
Total operating revenue 14,205
Operating expenses:
-------------------
General and administrative 7,819
------
Total operating expenses 7,819
------
Operating Income 6,386
Other income (expense):
-----------------------
Interest and dividend income 2,159
Interest expense (12,136)
Investment income (expense) (1,338)
---------
Other, net (425)
---------
Loss before income taxes (5,354)
Income tax benefit (1,394)
---------
Net loss $ (3,960)
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THE CATALYST GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31,1997
<CAPTION>
(In thousands)
Unaudited
<S> <C>
Cash flows provided by (used in)
operating and investing activities:
Net loss (3,960)
Changes in operating and investing
assets and liabilities:
Management fee receivable (1,340)
Investments (12,337)
UTC escrow reserve 361
Other assets 2,125
Note to Springerville OP's - Due 12-31-97 (1,267)
Note to Trigen 400
Note payable - Great Lakes Power 44
Senior note payable - Trilon International 673
Junior note payable - First Toronto Equities 10,658
Accounts payable and accrued expenses (148)
Deferred income taxes 4,404
Net cash used in operating
and investing activities (387)
Net decrease in cash and cash equivalents (387)
Cash and cash equivalents at beginning
of year 3,271
Cash and cash equivalents at end of year $2,884
Supplemental disclosure of cash flow information:
Cash paid during the year for:
Income taxes (paid by Century) $548
Interest (net of amounts capitalized) $ 67
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THE CATALYST GROUP, INC. & SUBSIDIARIES
DECEMBER 31, 1997
CONSOLIDATING BALANCE SHEET
ASSETS
<CAPTION>
(in thousand)
The Catalyst Century CVHC/
Group, Inc. Power CVC CVAC
<S> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash $ 1,458 1,332 94
Invested Cash
Investments 134,298
Accounts Receivable 84 18
Interest Receivable
Management Fee Receivable 4,996
Affiliate Receivable 430
Related Parties 0
Other 2 145
Prepaid expenses/other 0
Total current assets 1,890 135,859 5,108 0
Plant, Property and
Equipment net 71
Note receivable 2,510 721
UTC Escrow Account 6,500
Notes receivable - Carena 25,800
Other assets
Receivable from Century 14,635
Investments in subs 143,354 148,523 143,760
Investments 720
Deferred Tax Benefit 100
Intercompany accounts 1
Total assets $ 169,681 161,759 154,352 143,760
THE CATALYST GROUP, INC. & SUBSIDIARIES
DECEMBER 31, 1997
CONSOLIDATING BALANCE SHEET CONTINUED
ASSETS
(in thousand)
Total Elimination Entries
Combined Debit Credit Total
<S> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash $ 2,884
Invested Cash 0
Investments 134,298 133,593 705
Accounts Receivable 102 84 18
Interest Receivable 0 0
Management Fee Receivable 4,996 4,996
Affiliate Receivable 430 430 0
Related Parties 0 0
Other 147 145 2
Prepaid expenses/other 0 0
------- ------- -------- -------
Total current assets 142,850 0 134,252 8,605
Plant, Property and
Equipment net 71 71
Receivables from settlements 0 0
Note receivable 3,231 3,231
UTC Escrow Account 6,500 6,500
Notes receivable - Carena 25,800 25,800
Other assets 0 0
Receivable from Century 14,635 14,635 0
Investments in subs 435,637 287,114 148,523
Investments 720 720
Deferred Tax Benefit 100 100 0
Intercompany accounts 1 1 0
-------- ------- -------- --------
Total assets $629,552 0 $436,102 $193,450
THE CATALYST GROUP, INC AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEET CONTINUED
LIABILITIES AND EQUITY
The Catalyst Century CVHC/
Group,Inc Power CVC CVAC
<S> <C> <C> <C> <C>
LIABILITIES & STOCKHOLDERS'
EQUITY
Current Liabilities:
Accounts payable $17,920 266
Management Fee payable 1,600
Related party payables 387 44
------- ------ ------ ------
Total current liabilities 18,307 266 1,644 0
Intercompany payables 6,500 14,635
Deferred income taxes 11,493
Income Taxes payable 1,701 0
Other liabilities 449
Long term debt 115,581
-------- ------ ------ ------
Total liabilities 142,538 14,901 13,137 0
Shareholders' equity
Common stock 999
Senior Preferred Stock 1 134
Junior Preferred Stock 1
Additional paid in capital 198,999 186,153 132,894 143,760
Accum deficiency (172,857) (39,295) 8,187
Total sharholders' --------- -------- ------- -------
equity 27,143 146,858 141,215 143,760
Total liabilities & --------- -------- ------- -------
shareholders' equity $169,681 161,759 154,352 143,760
THE CATALYST GROUP, INC. & SUBSIDIARIES
DECEMBER 31, 1997
CONSOLIDATING BALANCE SHEET CONTINUED
LIABILITIES AND EQUITY
(in thousand)
Total Consolidating Entries
Combined Debit Credit Total
<S> <C> <C> <C> <C>
LIABILITIES & STOCKHOLDERS'
EQUITY
Current Liabilities:
Accounts payable $18,186 $18,186
Management Fee payable 1,600 1,600
Related party payables 431 431 0
------- ------ ------ -------
Total current liabilities 20,217 431 0 19,786
Intercompany payables 21,135 21,135 0
Deferred income taxes 11,493 5,017 6,476
Income Taxes payable 1,701 264 1,437
Other liabilities 449 449
Long term debt 115,581 115,581
------- ------ ------ -------
Total liabilities 170,576 26,847 0 143,729
Shareholders' equity
Common stock 999 1 1,000
Senior Preferred Stock 135 134 133,999 134,000
Junior Preferred Stock 1 64,999 65,000
Additional paid in capital 661,806 661,806 0
Accum deficiency (203,965) 329 54,015 (150,279)
Total shareholders' -------- ------- ------- --------
equity 458,976 662,269 253,014 49,721
Total liabilities & -------- ------- ------- --------
shareholders' equity 629,552 689,116 253,014 193,450
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THE CATALYST GROUP INC. AND SUBSIDIARIES
DECEMBER 31, 1997
CONSOLIDATING INCOME STATEMENT
<CAPTION>
(in thousand)
Catalyst Century CVHC/
Group, Inc. Power CVC CVAC
<S> <C> <C> <C> <C>
Equity interest in Catalyst 0 0 0 0
Old River Hydroelectric 12,474
Management Fee payable 1,73
------- ------- ------- -------
Total operating revenue 0 0 14,205 0
Operating expenses:
General and administrative 397 397 6,696
-------- ------- ------- -------
Operating income (loss) (397) (397) 7,509 0
Other income (deductions):
Interest and dividend income 364 1,730 65
Interest expense (12,069) (67)
Other income/expenses (400) (137) 112
Investment income/(loss) 62 (1,400)
Income (loss) before income
taxes,& minority int (12,440) (271) 7,686 0
Provision for taxes 548 3,075 0
------- ------ ------- -------
Net income (loss) (12,440) (819) $ 4,611 $ 0
THE CATALYST GROUP, INC. & SUBSIDIARIES
DECEMBER 31, 1997
CONSOLIDATING INCOME STATEMENT CONTINUED
(in thousand)
<CAPTION>
Total
Combined Debit Credit Total
<S> <C> <C> <C> <C>
Equity interest in Catalyst
Old River Hydroelectric 12,474 $12,474
Management Fee payable 1,731 1,731
------- ------- ------- -------
Total operating revenue 14,205 14,205
Operating expenses:
General and administrative 7,490 329 7,819
------- ------- ------- -------
Operating income (loss) 6,715 (329) 6,386
Other income (deductions):
Interest and dividend income 2,159 2,159
Interest expense (12,136) (12,136)
Other income/expenses (425) (425)
Investment income/(loss) (1,338) (1,338)
Income (loss) before taxes ------- ------- ------- -------
& minority interest (5,025) (329) 0 (5,354)
Provision for taxes 3,623 5,017 (1,394)
------- ------- ------- -------
Net income (loss) $ (8,648) $(329) (5,017) (3,960)
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STOCKHOLDERS EQUITY ROLLFORWARDS
CONSOLIDATED:
<CAPTION>
<S> <C>
CONSOLIDATED
Shareholder Equity Consolidated 1/1/97 53,681
Current year Earnings (consolid basis) (3,960)
--------
Shareholder Equity End of Period 49,721
THE CATALYST GROUP, INC.
Shareholder Equity 1/1/97 40,331
Prior period adjustment (748)
Current year Earnings (12,440)
--------
Shareholder Equity End of Period 27,143
CENTURY Stand Alone
Shareholder Equity 1/1/97 147,677
Current year activity (819)
--------
R/E - End of Period 146,858
CVAC Stand Alone
Shareholder Equity 1/1/97 143,760
Current year activity 0
--------
Shareholder Equity End of Period 143,780
CVHC/CVC Stand Alone
Shareholder Equity 1/1/97 136,604
Current year earnings 4,611
--------
Shareholder Equity End of Period 141,215
Flux from Balance Sheet 0
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THE CATALYST GROUP, INC.
CONSOLIDATING ENTRIES
12/31/97
<CAPTION>
Description Debit Credit
<S> <C> <C>
1* Equity of CVAC 143,354
Investment in CVAC 143,354
Eliminate TCG investment in CVAC (9,760 + 133,593)
2* Equity of Century 8,760
Equity of CVHC 134,000
Equity of CVHC 1,000
Investment in Century (@ cost) 8,760
Investment in CVHC - Preferred 134,000
Investment in CVHC - Common 1,000
Eliminate CVAC investment in Century and CVHC
3* Other Liabilities 6,500
Related Earnings 6,500
Eliminate UTC escrow liability as adjusted
4* Income taxes Payable 264
Retained Earnings 264
Carryforward of PY entry adjusted for actual balance booked to
Century
5 A/P CEC-Taxes 14,635
A/R Century 14,635
Eliminate intercompany payable/receivable b/t The Catalyst Group and
Century
6 A/P - CVHC 431
A/R - TCG 430
Intercompany Accounts 1
Eliminate interco receivable and payable b/t CVHC and TCG
7* Equity of CVHC 133,593
Additional Paid in Capital 133,593
Eliminate Century investment in CVHC
8* Senior Preferred Stock 134
Addit Pd In Capital 42,100
Accum Deficiency 42,234
To adjust capital account to agree with parent company
9*APIC 198,999
Common Stock 1
Senior Preferred 133,999
Junior Preferred 64,999
To change presentation of R/E from par valuation to actual value
10* Deferred Taxes 5,017
Tax Provision 5,017
To have tax provision equal 40% of total consolidated income
11 Bad Debt Expense 329
Century Accounts Receivable 84
Century Deposits 100
Century Other 145
Reserves against uncollectable assets
No change from prior report.
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