Amendment No. 1 to
SEC File No. 70-8805
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM U-1
APPLICATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ("Act")
JERSEY CENTRAL POWER & LIGHT COMPANY ("JCP&L")
300 Madison Avenue
Morristown, New Jersey 07960
METROPOLITAN EDISON COMPANY ("MET-ED")
PENNSYLVANIA ELECTRIC COMPANY ("PENELEC")
2800 Pottsville Pike
Reading, Pennsylvania 19640
GPU SERVICE CORPORATION ("GPUSC")
100 Interpace Parkway
Parsippany, New Jersey 07054
(Names of companies filing this statement and
addresses of principal executive offices)
GENERAL PUBLIC UTILITIES CORPORATION
(Name of top registered holding company parent of applicants)
T. G. Howson, Vice President W. Edwin Ogden, Esq.
and Treasurer Ryan, Russell, Ogden &
M. A. Nalewako, Secretary Seltzer
M. J. Connolly, Esq., Director 1100 Berkshire Boulevard
of Legal Services P.O. Box 6219
GPU Service Corporation Reading, Pennsylvania 19610
100 Interpace Parkway
Parsippany, New Jersey 07054 Robert C. Gerlach, Esq.
Ballard Spahr Andrews &
S. L. Guibord, Secretary Ingersoll
Jersey Central Power & Light 1735 Market Street
Company Philadelphia, Pennsylvania
300 Madison Avenue 19103
Morristown, New Jersey 07960
Douglas E. Davidson, Esq.
S. L. Guibord, Secretary Berlack, Israels &
Metropolitan Edison Company Liberman LLP
Pennsylvania Electric Company 120 West 45th Street
P.O. Box 16001 New York, New York 10036
Reading, Pennsylvania 19640
(Names and addresses of agents for service)<PAGE>
JCP&L, Met-Ed, Penelec and GPUSC hereby amend their
Application on Form U-1, docketed in SEC File No. 8805, as
follows:
1. By amending paragraph D of Item 1 thereof to read in
its entirety as follows:
D. The Applicants propose to provide (i) meter
reading, billing and collection services, and
customer call-center services ("Services") for
non-affiliated water and gas utility entities
including the utility agencies of cities,
municipalities, counties and governmental entities
("Non-Affiliated Utilities"), and (ii)
consolidated electric, water and gas bills,
consolidated remittance processing of electric,
water and gas utility accounts and consolidated
account services ("Consolidated Services") for
Non-Affiliated Utilities.
2. By amending subparagraph (iii) of paragraph E of Item 1
thereof to read in its entirety as follows:
(iii) The GPU Companies anticipate that many
opportunities to provide such Services to Non-
Affiliated Utilities may arise in or near the
service territories of JCP&L, Met-Ed and Penelec.
In no event will such Services be provided to a
Non-Affiliated Utility where more than 49% of the
customers of such Non-Affiliated Utility are not
also electric customers of one or more of JCP&L,
Met-Ed and Penelec (collectively, the "Utility
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Subsidiaries"); except that such limitation may be
exceeded with respect to one or more Non-
Affiliated Utilities provided that (i) the
aggregate number of customers of each such Non-
Affiliated Utility whose meters are read, bills
are processed or calls are handled who are not
also electric customers of one or more of the
Utility Subsidiaries does not exceed the aggregate
number of electric customers of the Utility
Subsidiaries (currently approximately 2 million),
and (ii) any such customers that are not also
electric customers of one or more of the Utility
Subsidiaries are located within the service
territory of one or more of the Utility
Subsidiaries (for example, as the customer of a
municipal electric utility the service territory
of which is contained within a Utility Subsidiary
service territory) or within the service territory
of a contiguous Non-Affiliated Utility.
3. By deleting paragraph F of Item 1 thereof in its
entirety, and by re-designating paragraphs G, H, I, J, K and L of
Item 1 thereof as paragraphs F, G, H, I, J and K.
4. By amending re-designated paragraph F of Item 1 thereof
to read in its entirety as follows:
F. CONSOLIDATED SERVICES
The Applicants anticipate opportunities to provide
Consolidated Services for Non-Affiliated Utilities
to which they are providing Services. Therefore,
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the Applicants also request authority to engage in
the provision of these Consolidated Services to
such Non-Affiliated Utilities when and if the
opportunity arises and where the GPU Companies
determine that it is economically beneficial to do
so. The Services and the Consolidated Services
are collectively referred to as the "Proposed New
Services".
5. By deleting the first sentence of re-designated
paragraph G of Item 1 thereof.
6. By amending the second sentence of re-designated
paragraph J of Item 1 thereof to read in its entirety as follows:
GPUSC, when it is not providing a Proposed New
Service directly to a Non-Affiliated Utility, may
provide support to the Utility Subsidiaries in
connection with any such services provided by them
and will document its expenses in separate work
orders which, with the usual and customary
overheads, will be charged to the appropriate
accounts of JCP&L, Met-Ed and Penelec in
proportion to the interest of each company, if
any, in the particular transaction.
7. By adding a new paragraph L to Item 1 thereof to read
in its entirety as follows:
L. GPU submits that all of the criteria of Rules 53
and 54 under the Act with respect to the proposed
transactions are satisfied:
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(i) The average consolidated retained
earnings for GPU and its subsidiaries, as reported
for the four most recent quarterly periods in
GPU's Annual Report on Form 10-K for the year
ended December 31, 1995 and Quarterly Reports on
Form 10-Q for the quarters ended June 30, 1995,
September 30, 1995 and March 31, 1996, as filed
under the Securities Exchange Act of 1934, was
approximately $1.99 billion. As of June 30, 1996,
GPU had invested, or committed to invest, directly
or indirectly, an aggregate of approximately $241
million in exempt wholesale generators ("EWGs")
and $673 million in foreign utility companies
("FUCOs"), which as of that date would permit GPU
to make additional such investments of
approximately $113 million and remain within the
50% ("safe harbor") limitation of Rule 53. GPU's
aggregate investment in EWGs and FUCOs, including
amounts invested pursuant to all outstanding or
pending authorizations to make investments in EWGs
or FUCOs will not at any time exceed the "safe
harbor" limitation imposed by Rule 53 without
prior Commission authorization.
(ii) GPU maintains books and records to
identify investments in, and earnings from, each
EWG and FUCO in which it directly or indirectly
holds an interest.
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(A) For each United States EWG in which
GPU directly or indirectly holds an interest:
(1) the books and records for such
EWG will be kept in conformity with United States
generally accepted accounting principles ("GAAP");
(2) the financial statements will
be prepared in accordance with GAAP; and
(3) GPU directly or through its
subsidiaries undertakes to provide the Commission
access to such books and records and financial
statements as the Commission may request.
(B) For each FUCO or foreign EWG which
is a majority-owned subsidiary of GPU:
(1) the books and records for such
subsidiary will be kept in accordance with GAAP;
(2) the financial statements for
such subsidiary will be prepared in accordance
with GAAP; and
(3) GPU directly or through its
subsidiaries undertakes to provide the Commission
access to such books and records and financial
statements, or copies thereof in English, as the
Commission may request.
(C) For each FUCO or foreign EWG in
which GPU owns 50% or less of the voting
securities, GPU directly or through its
subsidiaries will proceed in good faith, to the
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extent reasonable under the circumstances, to
cause
(1) such entity to maintain books
and records in accordance with GAAP;
(2) the financial statements of
such entity to be prepared in accordance with
GAAP; and
(3) access by the Commission to
such books and records and financial statements
(or copies thereof) in English as the Commission
may request and, in any event, will provide the
Commission on request copies of such materials as
are made available to GPU and its subsidiaries.
If and to the extent that such entity's books,
records or financial statements are not maintained
in accordance with GAAP, GPU will, upon request of
the Commission, describe and quantify each
material variation therefrom as and to the extent
required by subparagraphs (a) (2) (iii) (A) and
(a) (2) (iii) (B) of Rule 53.
(iii) No more than 2% of GPU's domestic
public utility subsidiary employees will render
any services, directly or indirectly, to any EWG
or FUCO in which GPU directly or indirectly holds
an interest.
(iv) Copies of this Application are being
provided to the New Jersey Board of Public
Utilities, the Pennsylvania Public Utility
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Commission and the New York Public Service
Commission, the only federal, state or local
regulatory agencies having jurisdiction over the
retail rates of GPU's electric utility
subsidiaries. In addition, GPU will submit to
each such commission copies of any Rule 24
certificates required hereunder, as well as a copy
of Item 9 of GPU's Form U5S and Exhibits G and H
thereof (commencing with the Form U5S to be filed
for the calendar year in which the authorization
herein requested is granted).
(v) None of the provisions of paragraph (b)
of Rule 53 render paragraph (a) of that Rule
unavailable for the proposed transactions.
(A) Neither GPU nor any subsidiary of
GPU is the subject of any pending bankruptcy or
similar proceeding.
(B) GPU's average consolidated retained
earnings for the four most recent quarterly
periods (approximately $1.99 billion) represented
an increase of approximately $199 million (or
approximately 11%) in the average consolidated
retained earnings for the previous four quarterly
periods (approximately $1.79 billion).
(C) GPU did not incur operating losses
from direct or indirect investments in EWGs and
FUCOs in 1995 in excess of 5% of GPU's
consolidated retained earnings.
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(vi) In accordance with Rule 54, the
requirements of Rule 53(a), (b) and (c) are
fulfilled.
8. By amending Item 2 thereof to read in its entirety as
follows:
ITEM 2. FEES, COMMISSIONS AND EXPENSES.
The estimated fees, commissions and expenses expected
to be incurred in connection with the proposed transactions are
as follows:
Filing fees - Securities and Exchange
Commission $ 2,000
Legal fees:
Berlack, Israels & Liberman LLP 5,000
Ryan, Russell, Ogden & Seltzer 1,000
Ballard Spahr Andrews & Ingersoll 2,000
Miscellaneous 1,000
Total $ 11,000
9. By filing the following exhibits in Item 6(a) thereof:
F-1 Opinion of Berlack, Israels & Liberman LLP
F-2 Opinion of Ballard Spahr Andrews & Ingersoll.
F-3 Opinion of Ryan, Russell, Ogden & Seltzer.
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SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935, THE UNDERSIGNED COMPANIES HAVE DULY
CAUSED THIS STATEMENT TO BE SIGNED ON THEIR BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
GPU SERVICE CORPORATION
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
By:
T. G. Howson, Vice President
and Treasurer
Date: July 24, 1996<PAGE>
EXHIBITS TO BE FILED BY EDGAR
Exhibits:
F-1 Opinion of Berlack, Israels & Liberman LLP
F-2 Opinion of Ballard Spahr Andrews & Ingersoll.
F-3 Opinion of Ryan, Russell, Ogden & Seltzer.<PAGE>
(Letterhead of Berlack, Israels & Liberman LLP)
Exhibit F-1
July 24, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: GPU Service Corporation
Jersey Central Power & Light Company
Metropolitan Edison Company
Pennsylvania Electric Company
Application on Form U-1
SEC File No. 70-8805
Gentlemen:
We have examined the Application on Form U-1, dated
February 22, 1996, under the Public Utility Holding Company Act
of 1935 (the "Act"), filed by GPU Service Corporation ("GPUSC"),
Jersey Central Power & Light Company ("JCP&L"), Metropolitan
Edison Company ("Met-Ed") and Pennsylvania Electric Company
("Penelec") and, together with GPUSC, JCP&L and Met-Ed, the
"Applicants") with the Securities and Exchange Commission (the
"Commission") and docketed in SEC File No. 70-8805, as amended by
Amendment No. 1 thereto, dated this date, of which this opinion
is to be a part. (The Application, as thus to be amended, is
hereinafter referred to as the "Application".)
The Application contemplates, among other things, the
provision by the Applicants of (i) meter reading, billing and
collection services, and customer call-center services for non-
affiliated water and gas utility entities including the utility
agencies of cities, municipalities, counties and governmental
entities ("Non-Affiliated Utilities"), and (ii) consolidated
electric, water and gas bills, consolidated remittance processing
of electric, water and gas utility accounts and consolidated
account services for Non-Affiliated Utilities.
<PAGE>
Securities and Exchange Commission
July 24, 1996
Page 2
For many years, we have participated in various
proceedings related to the issuance and sale of securities by
General Public Utilities Corporation and its subsidiaries, and we
are familiar with the terms of the outstanding securities of the
corporations comprising the General Public Utilities holding
company system.
We have examined copies, signed, certified or otherwise
proven to our satisfaction, of the Certificate or Articles of
Incorporation, as the case may be, and By-Laws of each of the
Applicants. In addition, we have examined such other instruments,
agreements and documents and made such further investigations as we
have deemed necessary as a basis for this opinion.
We are members of the Bar of the States of New York and
New Jersey and do not purport to be expert in the laws of any
jurisdiction other than the laws of the States of New York and New
Jersey and the Federal laws of the United States. As to all
matters of Pennsylvania law involving GPUSC, Penelec and JCP&L, we
have relied upon the opinion of Ballard Spahr Andrews & Ingersoll,
and as to all matters of Pennsylvania law involving Met-Ed, we have
relied upon the opinion of Ryan, Russell, Ogden & Seltzer, which
are being filed as Exhibits F-2 and F-3, respectively, to the
Application.
Based upon and subject to the foregoing, and assuming
that the transactions therein proposed are carried out in
accordance with the Application and that the performance of
consolidated billing services shall have been duly approved by the
Pennsylvania Public Utility Commission and/or the New Jersey Board
of Public Utilities, if and to the extent required, we are of the
opinion that when the Commission shall have entered an order
forthwith granting the Application,
(a) all State laws applicable to the proposed
transaction will have been complied with; and
(b) the consummation of the proposed transactions will
not violate the legal rights of the holders of any securities
issued by General Public Utilities Corporation or any
"associate company" thereof, as defined in the Act.
We hereby consent to the filing of this opinion as an
exhibit to the Application and in any proceedings before the
Commission that may be held in connection therewith.
Very truly yours,
BERLACK, ISRAELS & LIBERMAN LLP
<PAGE>
(Letterhead of Ballard Spahr Andrews & Ingersoll)
Exhibit F-2
July 24, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: GPU Service Corporation
Jersey Central Power & Light Company
Metropolitan Edison Company
Pennsylvania Electric Company
Application on Form U-1
SEC File No. 70-8805
Gentlemen:
We have examined the Application on Form U-1, dated
February 22, 1996, under the Public Utility Holding Company Act
of 1935 (the "Act"), filed by GPU Service Corporation ("GPUSC"),
Jersey Central Power & Light Company ("JCP&L"), Metropolitan
Edison Company ("Met-Ed") and Pennsylvania Electric Company
("Penelec") and, together with GPUSC, JCP&L and Met-Ed, the
"Applicants") with the Securities and Exchange Commission (the
"Commission") and docketed in SEC File No. 70-8805, as amended by
Amendment No. 1 thereto, dated this date, of which this opinion
is to be a part. (The Application, as thus to be amended, is
hereinafter referred to as the "Application".)
The Application contemplates, among other things, the
provision by the Applicants of (i) meter reading, billing and
collection services, and customer call-center services for non-
affiliated water and gas utility entities including the utility
agencies of cities, municipalities, counties and governmental
entities ("Non-Affiliated Utilities"), and (ii) consolidated
electric, water and gas bills, consolidated remittance processing
of electric, water and gas utility accounts and consolidated
account services for Non-Affiliated Utilities.
<PAGE>
Securities and Exchange Commission
July 24, 1996
Page 2
We have been counsel to Penelec, a Pennsylvania
corporation, for many years and are familiar with the terms of
its outstanding securities. We have also acted as Pennsylvania
counsel in connection with the transactions contemplated by the
Application (a) to GPUSC, a Pennsylvania corporation, and (b) to
JCP&L, a New Jersey corporation which is qualified to do business
in Pennsylvania as a foreign corporation and owns certain
interests in utility facilities in Pennsylvania. We have
examined such instruments, agreements and documents and made such
further investigation as we have deemed necessary as a basis for
this opinion.
Based upon and subject to the foregoing, and assuming
that the transactions therein proposed are carried out in
accordance with the Application and that the performance of
consolidated billing services by Penelec shall have been duly
approved by the Pennsylvania Public Utility Commission, if and to
the extent required, we are of the opinion, insofar as
Pennsylvania law is concerned, that when the Commission shall
have entered an order forthwith granting the Application,
(a) all Pennsylvania laws applicable to the proposed
transactions by Penelec will have been complied
with; and
(b) the consummation of the proposed transactions will
not violate the legal rights of the holders of any
securities issued by General Public Utilities
Corporation, GPUSC, Penelec or any of its
subsidiaries.
We hereby consent to the filing of this opinion as an
exhibit to the Application and in any proceedings before the
Commission that may be held in connection therewith.
Very truly yours,
BALLARD SPAHR ANDREWS & INGERSOLL
<PAGE>
(Letterhead of Ryan, Russell, Ogden & Seltzer)
Exhibit F-3
July 24, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: GPU Service Corporation
Jersey Central Power & Light Company
Metropolitan Edison Company
Pennsylvania Electric Company
Application on Form U-1
SEC File No. 70-8805
Ladies and Gentlemen:
On behalf of Metropolitan Edison Company ("Met-Ed"), we
have examined the Application on Form U-1, dated February 22,
1996, under the Public Utility Holding Company Act of 1935 (the
"Act"), filed by GPU Service Corporation ("GPUSC"), Jersey
Central Power & Light Company ("JCP&L"), Met-Ed and Pennsylvania
Electric Company ("Penelec" and, together with GPUSC, JCP&L and
Met-Ed, the "Applicants") with the Securities and Exchange
Commission (the "Commission") and docketed in SEC File No. 70-
8805, as to be amended by Amendment No. 1 thereto, dated this
date, of which this opinion is to be a part. (The Application,
as thus to be amended, is hereinafter referred to as the
"Application".)
The Application contemplates, among other things, the
provision by the Applicants of (i) meter reading, billing and
collection services, and customer call-center services for non-
affiliated water and gas utility entities including the utility
agencies of cities, municipalities, counties and governmental
entities ("Non-Affiliated Utilities"), and (ii) consolidated
electric, water and gas bills, consolidated remittance processing
of electric, water and gas utility accounts and consolidated
account services for Non-Affiliated Utilities.<PAGE>
Securities and Exchange Commission
July 24, 1996
Page 2
We have been counsel to Met-Ed, a Pennsylvania
corporation, for many years. In such capacity, we have
participated in various proceedings relating to Met-Ed, and we
are familiar with the terms of the outstanding Met-Ed securities.
We have examined copies, signed, certified or otherwise
proven to our satisfaction, of the Articles of Incorporation and
By-Laws of Met-Ed. In addition, we have examined such other
instruments, agreements and documents and made such further
investigation as we have deemed necessary as a basis for this
opinion.
We are members of the Bar of the Commonwealth of
Pennsylvania and do not purport to be expert in the laws of any
jurisdiction other than the laws of the Commonwealth of
Pennsylvania.
Based upon and subject to the foregoing, and assuming
that the transactions therein proposed are carried out in
accordance with the Application and that the performance of
consolidated billing services shall have been duly approved by
the Pennsylvania Public Utility Commission, if and to the extent
required, we are of the opinion that when the Commission shall
have entered an order forthwith granting the Application,
(a) all Pennsylvania laws applicable to the proposed
Met-Ed transactions will have been complied with; and
(b) the consummation of the proposed Met-Ed
transactions will not violate the legal rights of the
holders of any securities issued by Met-Ed.
We hereby consent to the filing of this opinion as an
exhibit to the Application and in any proceedings before the
Commission that may be held in connection therewith.
Very truly yours,
RYAN, RUSSELL, OGDEN & SELTZER<PAGE>
