Post-Effective Amendment No. 20 to
SEC File No. 70-8593
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-1
APPLICATION UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ("Act")
GPU, INC. ("GPU")
GPU SERVICE, INC. ("GPUS")
100 Interpace Parkway
Parsippany, New Jersey 07054
GPU INTERNATIONAL, INC.("GPU International")
EI SERVICES, INC. ("EI Services")
One Upper Pond Road, Parsippany, New Jersey 07054
JERSEY CENTRAL POWER & LIGHT COMPANY ("JCP&L")
METROPOLITAN EDISON COMPANY ("Met-Ed")
PENNSYLVANIA ELECTRIC COMPANY ("Penelec")
P.O. Box 16001, Reading, Pennsylvania 19640
(Names of companies filing this statement
and addresses of principal offices)
GPU, INC.
(Name of top registered holding company
parent of the applicants)
M. A. Nalewako, Secretary Douglas E. Davidson, Esq.
M. J. Connolly, Esq., Berlack, Israels & Liberman LLP
Assistant General Counsel 120 West 45th Street
GPU Service, Inc. New York, New York 10036
100 Interpace Parkway
Parsippany, New Jersey 07054
W. S. Greengrove, Secretary S. L. Guibord, Esq.
GPU International, Inc. Secretary
GPU Electric, Inc. Jersey Central Power &
One Upper Pond Road Light Company
Parsippany, New Jersey 07054 Metropolitan Edison Company
Pennsylvania Electric Company
P.O. Box 16001
Reading, Pennsylvania 19640
(Names and addresses of agents for service)
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GPU, GPU International, EI Services, JCP&L, Met-Ed, Penelec
and GPUS hereby amend Post-Effective Amendment No. 18 to their
Application on Form U-1, docketed in SEC File No. 70-8593, as
heretofore amended, to read in its entirety as follows:
A. GPU's authorization in this docket granted by order
dated November 5, 1997 (HCAR No. 35-2673) currently expires on
December 31, 1997. That order authorizes GPU to invest or commit
to invest up to 100% of GPU's "consolidated retained earnings" as
defined in Rule 53(a) under the Act, in exempt wholesale
generators ("EWGs") and foreign utility companies ("FUCOs", and
collectively with EWGs, "Exempt Entities"). Accordingly, GPU
proposes to extend until December 31, 2000 the period during
which GPU may acquire the securities of one or more Exempt
Entities indirectly through Subsidiary Companies,(1) and make
investments in Subsidiary Companies and Exempt Entities, in an
aggregate amount of up to 100% of "consolidated retained
earnings" as defined in Rule 53(a) under the Act, or as the
Commission may provide otherwise by order in this docket. GPU
also proposes that any Subsidiary Company (including GPU
Electric, Inc.) may guarantee or assume liabilities of the
securities or other obligations of their direct or indirect
subsidiaries (provided the issue and sale of any such security is
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1 As used herein, the term "Subsidiary Company" means a company which
is engaged directly or indirectly, and exclusively, in the business of
owning and holding the interests and securities of one or more Exempt
Entities and in project development activities relating to the
acquisition of such interests and securities and the underlying
projects.
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exempt from the requirement of prior Commission approval under
Sections 6(a) of the Act or has been authorized by Commission
order) from time to time through December 31, 2000 in an
aggregate amount not to exceed $1 billion at any time
outstanding, provided that any such Guarantee or assumption which
is recourse to GPU would be included in determining GPU's
"aggregate investment", as defined in Rule 53, in Exempt
Entities. Guarantees may include guarantees, support instruments
or bank letter of credit reimbursement agreements or similar
financial instruments or undertakings.
B. GPU submits that all of the criteria of Rules 53 and 54
under the Act with respect to the proposed transactions are
satisfied:
(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, 1996 and Quarterly Reports on
Form 10-Q for the quarters ended March 31, 1997 and June 30,
1997, as filed under the Securities Exchange Act of 1934,
was approximately $2,142 million. As of June 30, 1997, GPU
had invested, or committed to invest, directly or
indirectly, an aggregate of approximately $954 million in
EWGs and FUCOs. GPU's aggregate investment in EWGs and
FUCOs, pursuant to all outstanding or pending authorizations
to make investments in EWGs or FUCOs, will not at any time
exceed the limitation imposed by the Commission in its order
dated November 5, 1997 (HCAR No. 35-26773) without further
Commission authorization.
(ii) GPU maintains books and records to identify investments
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in, and earnings from, each EWG and FUCO in which it
directly or indirectly holds an interest.
(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 the 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 extent
reasonable under the circumstances, to cause
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(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, GPU
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 and FUCO in which GPU directly or
indirectly holds an interest.
(iv) Copies of this Post-Effective Amendment are being
provided to the New Jersey Board of Public Utilities and the
Pennsylvania Public Utility Commission, the only federal,
state or local regulatory agencies having jurisdiction over
the retail rates of GPU's electric utility subsidiaries.(2) In
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2 Pennsylvania Electric Company ("Penelec") is also subject to
retail rate regulation by the New York Public Service Commission
with respect to retail service to approximately 11,300 customers
in Waverly, New York served by Waverly Electric Power &
Company, a Penelec subsidiary. Waverly Electric's revenues are
immaterial, accounting for less than 1% of Penelec's total
operating revenues.
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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 H and I 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 $2,142 million)
represented an increase of approximately $28 million in the
average consolidated retained earnings for the previous four
quarterly periods (approximately $2,114 million).
(C) GPU did not incur operating losses from direct or
indirect investments in EWGs and FUCOs in 1996 in excess of 5% of
GPU's December 31, 1996 consolidated retained earnings.
(vi) In accordance with Rule 54, the requirements of Rule 53(a),
(b) and (c) are fulfilled.
C. The estimated fees, commissions and expenses to be
incurred by GPU in connection with the proposed transactions will
be filed by amendment.
D. GPU believes that Sections 6(a), 7, 9(a), 10, 12, 32,
and 33 of the Act and Rules 43, 45, 53 and 54 are applicable to
the proposed transactions.
E. No Federal or State Commission, other than your
Commission has jurisdiction with respect to the proposed
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transactions.
F. It is requested that the Commission issue an order with
respect to the transactions proposed herein at the earliest
practicable date but, in any event, not later than December 15,
1997. It is further requested that (i) there not be a
recommended decision by an Administrative Law Judge or other
responsible officer of the Commission, (ii) the Office of Public
Utility Regulation be permitted to assist in the preparation of
the Commission's decision, and (iii) there be no waiting period
between the issuance of the Commission's order and the date on
which it is to become effective.
G. The following exhibits and financial statements are
filed in Item 6 hereof:
(a) Exhibits.
F - Opinion of Berlack, Israels & Liberman LLP to be
filed by amendment.
G - Financial Data Schedule to be filed by
amendment.
(b) Financial Statements.
1-A - GPU and Subsidiary Companies Consolidated
Balance Sheets, actual and pro forma, as at
September 30, 1997, and Consolidated
Statements of Income and Retained Earnings,
actual and pro forma, for the twelve months
ended Septemer 30, 1997; pro forma journal
entries to be filed by amendment.
1-B - GPU (Corporate) Balance Sheets, actual and pro
forma, as at September 30, 1997, Statements of
Income and Retained Earnings, actual and pro
forma, for the twelve months ended September 30,
1997; pro forma journal entries to be filed by
amendment.
2 - Reference is made to 1-A above.
4 - None, except as set forth in Notes to the
Financial Statements.
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H. The proposed transaction will be carried out for the
purpose of financing GPU's business activities. As such, the
issuance of an order by your Commission with respect thereto is
not a major Federal action significantly affecting the quality of
the human environment.
I. No Federal agency has prepared or is preparing an
environmental impact statement with respect to the various
proposed transactions which are the subject hereof. Reference is
made to Item 4 hereof regarding regulatory approvals with respect
to the proposed transactions.
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SIGNATURE
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.
Dated: November 6, 1997
GPU, INC.
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
GPU SERVICE, INC.
By:
T. G. Howson
Vice President and Treasurer
GPU INTERNATIONAL, INC.
EI SERVICES, INC.
By:
B. L. Levy
President
