Amendment No. 2 to
SEC File No. 70-9309
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-l
DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ("Act")
GPU, INC. ("GPU")
300 Madison Avenue
Morristown, New Jersey 07962
JERSEY CENTRAL POWER & LIGHT COMPANY ("JCP&L")
PENNSYLVANIA ELECTRIC COMPANY ("Penelec")
METROPOLITAN EDISON COMPANY ("Met-Ed")
2800 Pottsville Pike
Reading, Pennsylvania 19605
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(Names of companies filing this statement and addresses
of principal executive offices)
GPU, INC.
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(Name of top registered holding company parent of applicants)
Scott L. Guibord Douglas E. Davidson, Esq.
Secretary Berlack, Israels & Liberman LLP
Jersey Central Power & 120 West 45th Street
Light Company New York, New York 10036
Metropolitan Edison Company
Pennsylvania Electric Company
2800 Pottsville Pike
Reading, Pennsylvania 19605
M.A. Nalewako, Secretary
Michael J. Connolly, Esq., Assistant
General Counsel
GPU Service, Inc.
300 Madison Avenue
Morristown, New Jersey 07962
(Names and addresses of agents for service)
<PAGE>
GPU, JCP&L, Met-Ed and Penelec hereby post-effectively amend their
Declaration on Form U-1, as heretofore amended, docketed in SEC File No.
70-9309, as follows:
1. By completing Item 2 thereof to read in its entirety as follows:
ITEM 2. FEES, COMMISSIONS AND EXPENSES.
--------------------------------
The Applicants estimate that the fees, commissions and expenses to
be incurred in connection with the proposed transactions will be as follows:
Legal Fees:
Berlack, Israels, & Liberman LLP $10,000.00
Ballard Spahr Andrews & Ingersoll, LLP $ 500.00
Miscellaneous $ 2,500.00
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Total $13,000.00
2. By filing the following exhibits in Item 6 thereof:
F-1 - Opinion of Berlack, Israels & Liberman LLP.
F-2 - Opinion of Ballard Spahr Andrews & Ingersoll, LLP.
H - Pro Forma Capitalization.
2
<PAGE>
SIGNATURE
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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, INC.
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
By: /s/ T. G. Howson
------------------
T. G. Howson,
Vice President and Treasurer
Dated: November 6, 1998
3
Exhibits to be Filed with EDGAR
Exhibits
F-1 - Opinion of Berlack, Israels & Liberman LLP.
F-2 - Opinion of Ballard Spahr Andrews & Ingersoll, LLP.
H - Pro Forma Capitalization.
Exhibit F-1
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November 6, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: GPU, Inc.
Jersey Central Power & Light Company
Metropolitan Edison Company
Pennsylvania Electric Company
Declaration on Form U-1
SEC File No. 70-9309
--------------------
Ladies and Gentlemen:
We have examined the Declaration on Form U-1, dated June 10, 1998,
under the Public Utility Holding Company Act of 1935 ("Act"), filed by GPU, Inc.
("GPU"), a Pennsylvania corporation, and its subsidiaries Jersey Central Power &
Light Company ("JCP&L"), a New Jersey corporation, Metropolitan Edison Company
("Met-Ed"), a Pennsylvania corporation, and Pennsylvania Electric Company
("Penelec"), a Pennsylvania corporation (JCP&L, Met-Ed and Penelec are
collectively referred to as the "Operating Companies"), with the Securities and
Exchange Commission ("Commission"), and docketed by the Commission in SEC File
No. 70-9309, as amended by Amendment No. 1 thereto, dated September 24, 1998 and
Amendment No. 2 thereto, dated this date, of which this opinion is to be a part.
(The Declaration, as so amended and as thus to be amended, is hereinafter
referred to as the "Declaration").
The Declaration requests authorization for GPU to execute and
deliver letter of credit reimbursement agreements or guarantees thereof
("collectively L/C Reimbursement Agreements") from time to time through December
31, 2006 in respect of letters of credit having an aggregate face amount of up
to $40 million ("L/Cs"). The L/Cs will be furnished by GPU Service, Inc.
("GPUS") on behalf of the Operating Companies and/or GPUS, GPU Nuclear, Inc.
<PAGE>
Securities and Exchange Commission
November 6, 1998
Page 2
and GPU Generation, Inc. to their insurance carriers providing workers
compensation insurance coverage.
We have been counsel to GPU and its subsidiaries for many years. In
that connection, we have participated in various proceedings relating to the
issuance of securities by GPU and its subsidiaries, and we are familiar with the
terms of the outstanding securities of the corporations comprising the GPU
holding company system.
We are members of the Bar of the State of New York and do not
purport to be expert on the laws of any jurisdiction other than the laws of the
States of New York. The opinions expressed herein are limited to matters
governed by the laws of the State of New York and the Federal laws of the United
States. As to all matters which are governed by the laws of the Commonwealth of
Pennsylvania, we have relied on the opinion of Ballard Spahr Andrews &
Ingersoll, LLP filed as Exhibit F-2 to the Declaration.
Based upon and subject to the foregoing, and assuming that (i) the
transactions therein proposed are carried out in accordance with the
Declaration, and (ii) the L/C Reimbursement Agreements are issued in compliance
with applicable guarantee limitations in GPU's revolving credit agreement and
third party guarantees, we are of the opinion that when the Commission shall
have entered an order forthwith permitting the Declaration to become effective,
(a) all State laws applicable to the proposed transactions will
have been complied with;
(b) GPU is validly organized and duly existing;
(c) the L/C Reimbursement Agreements will be valid and binding
obligations of GPU in accordance with their terms, subject to
the effect of any applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other
similar laws affecting creditors' rights generally and general
principles of equity limiting the availability of equitable
remedies; and
<PAGE>
Securities and Exchange Commission
November 6, 1998
Page 3
(d) the consummation of the transactions proposed in the
Declaration will not violate the legal rights of the holders
of any securities issued by GPU or any "associate company"
thereof, as defined in the Act.
We hereby consent to the filing of this opinion as an exhibit to the
Declaration and in any proceedings before the Commission that may be held in
connection therewith.
Very truly yours,
BERLACK, ISRAELS & LIBERMAN LLP
Exhibit F-2
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November 5, 1998
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
Re: GPU, Inc.
Jersey Central Power & Light Company
Metropolitan Edison Company
Pennsylvania Electric Company
Declaration on Form U-1
SEC File No. 70-9309
--------------------
Ladies and Gentlemen:
We have examined the Declaration on Form U-1, dated November 21,
1996, under the Public Utility Holding Company Act of 1935 ("Act"), filed by
GPU, Inc. ("GPU"), a Pennsylvania corporation, and its subsidiaries Jersey
Central Power & Light Company ("JCP&L"), a New Jersey corporation, Metropolitan
Edison Company ("Met-Ed"), a Pennsylvania corporation, and Pennsylvania Electric
Company ("Penelec"), a Pennsylvania corporation (JCP&L, Met-Ed and Penelec are
collectively referred to as the "Operating Companies"), with the Securities and
Exchange Commission ("Commission"), and docketed by the Commission in SEC File
No. 70-9309, as amended by Amendment No. 1 thereto, dated September 24, 1998,
and Amendment No. 2 thereto, dated this date, of which this opinion is to be a
part. (The Declaration, as so amended and as thus to be amended, is hereinafter
referred to as the "Declaration").
The Declaration requests authorization for GPU to execute and
deliver letter of credit reimbursement agreements or guaranties ("L/C
Reimbursement Agreements") from time to time through December 31, 2006 in
respect of letters of credit having an aggregate face amount of up to $40
million ("L/Cs"). The L/Cs will be furnished by GPU Service, Inc. (AGPUS@) on
behalf of the Operating Companies, GPU Nuclear, Inc., GPUS and GPU Generation,
<PAGE>
Inc. (collectively, the "Service Companies") to their insurance carriers
providing workers compensation insurance coverage.
We have been Pennsylvania counsel to GPU for many years. In that
capacity and as counsel to GPU's subsidiary, Penelec, we have participated in or
reviewed various proceedings relating to the issuance of securities by GPU and
Penelec, and we are familiar with the terms of the outstanding securities of GPU
and Penelec.
Based upon and subject to the foregoing, and assuming (x) that the
transactions proposed in the Declaration are carried out in accordance
therewith, and (y) the L/C Reimbursement Agreements are issued in compliance
with the applicable limitations of GPU's revolving credit agreement and third
party guarantees, we are of the opinion, insofar as matters of Pennsylvania law
are concerned, that when the Commission shall have entered an order forthwith
permitting the Declaration to become effective,
(a) all Pennsylvania laws applicable to the proposed transactions
by GPU will have been complied with;
(b) GPU is validly organized and duly existing;
(c) the L/C Reimbursement Agreements will be valid and binding
obligations of GPU; and
(d) the consummation of the transactions proposed in the
Declaration will not violate the legal rights of the holders
of any securities issued by GPU or Penelec or any subsidiary
of Penelec.
We hereby consent to the filing of this opinion as an exhibit to the
Declaration and in any proceedings before the Commission that may be held in
connection therewith.
Very truly yours,
Ballard Spahr Andrews & Ingersoll, LLP
EXHIBIT H
SEC File No. 70-9309
CAPITALIZATION AND CAPITALIZATION RATIOS
----------------------------------------
(IN THOUSANDS)
The actual and pro forma capitalization of GPU, Inc. and Subsidiary
Companies at June 30, 1998 is as follows:
Actual Pro Forma (3)
------------------------ ------------------
Amount % Amount %
------------- ----- ---------- ----
Long-term debt(1) $4,392,057 51.4 $4,392,057 51.4
Notes payable 487,160 5.7 487,160 5.7
Preferred stock (2) 155,478 1.8 155,478 1.8
Subsidiary-obligated
mandatorily redeemable
preferred securities 330,000 3.9 330,000 3.9
Common equity 3,172,886 37.2 3,172,886 37.2
--------- ----- --------- -----
$8,537,581 100.0 $8,537,581 100.0
========== ===== ========== =====
(1) Includes securities due within one year of $350,671.
(2) Includes securities due within one year of $2,500.
(3) The guarantee of letters of credit reimbursement agreements will not have a
pro forma impact on GPU's capitalization. Accordingly, there are no pro forma
adjustments. The pro forma capitalization excludes approximately $735 million of
GPU's proportionate share of non-recourse debt used to finance the acquisition
of exempt wholesale generators and foreign utility companies, as defined under
the Public Utility Holding Company Act of 1935, which debt is not consolidated
for financial reporting purposes. After giving effect to the non-recourse debt,
the pro forma percentages would be as follows: Long-term debt 55.3%; Notes
payable 5.2%; Preferred stock 1.7%; Subsidiary-obligated mandatorily redeemable
preferred securities 3.6%; and Common equity 34.2%.
