SEC File No.70-
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")
300 Madison Avenue
Morristown, New Jersey 07960
(Name of company filing this statement and addresses
of principal executive offices)
GPU, INC.
(Name of top registered holding company parent of applicants)
T. G. Howson, Douglas E. Davidson, Esq.
Vice President and Treasurer Berlack, Israels & Liberman LLP
S. L. Guibord, Secretary 120 West 45th Street
GPU Service, Inc. New York, New York 10036
300 Madison Avenue
Morristown, New Jersey 07960
M. J. Connolly
Vice President - Law
GPU Service, Inc.
300 Madison Avenue
Morristown, New Jersey 07960
(Names and addresses of agents for service)
<PAGE>
ITEM 1. DESCRIPTION OF PROPOSED TRANSACTIONS.
------------------------------------
A. GPU and its various subsidiary companies currently purchase workers
compensation insurance from Utilities Mutual Insurance Company ("UMI"), a
captive mutual insurer providing insurance to a limited number of companies(1),
and have been doing so since the 1920's. UMI is in the process of obtaining
approval from the New York State Department of Insurance to convert from a
mutual company to stock company status. It is UMI's intent that once it becomes
a stock company, each policy holder would receive shares of common stock, $.01
par value, of a newly-formed holding company parent, UMICO Holdings, Inc.
("UMICO"), which will be incorporated under New York law, in proportion to their
current ownership interest in UMI.
B. In connection with its demutualization, UMI intends to sell its
entire insurance portfolio to Cologne Re, which would then assume all UMI
obligations and liabilities for outstanding claims and future claims under
policies written by UMI. Thereafter, UMI will not conduct any active business
and the workers compensation insurance previously provided by UMI to its members
will instead be provided by an affiliate of Cologne Re to the UMICO shareholders
at least through 2003. It is expected, however, that UMI and UMICO would not be
liquidated and dissolved and would remain in existence until all claims or
potential claims covered by outstanding UMI policies have either been resolved
or adequately reinsured to the satisfaction of the New York Department of
Insurance. Upon dissolution, the UMICO shareholders would be entitled to their
pro rata shares of any remaining UMI surplus.
C. GPU and its subsidiaries(2) currently have an aggregate ownership
interest in UMI of approximately 36% and would, therefore, receive approximately
36% of UMICO's voting shares upon
______________________
(1) In addition to GPU and its subsidiaries, the current UMI members and
policy holders are South Jersey Industries, Inc., Central Hudson Gas & Electric
Corp., Empire State Electric Energy Research Corp., Griffith Oil Co., Long
Island Water Corp., Middleburg Telephone, New York State Electric & Gas Corp.,
Niagara Mohawk Power Corp., Rochester Gas & Electric Corp. and Fi-Net
Technologies.
(2) The GPU Subsidiaries are the following: GPU Advanced Resources, Inc.,
Metropolitan Edison Company, Pennsylvania Electric Company, Jersey Central Power
& Light Company, GPU International, Inc., GPU Service, Inc., GPU Nuclear, Inc.,
Prime Energy Limited Partnership ("Prime") and Onondaga Cogeneration Limited
Partnership ("Onondaga").
<PAGE>
UMI's demutualization. In order to more efficiently manage and administer its
workers compensation insurance programs, prior to demutualization, the GPU
subsidiaries (other than Prime and Onondaga) have assigned their present
interests in UMI to GPU. In contemplation of the pending demutualization, GPU
and the other utility policy holders have entered into a subscription agreement
providing for their purchase of shares of UMICO in proportion to their
respective interests in UMI. Under the subscription agreement, GPU has agreed to
acquire approximately 36.52% of UMICO in exchange for its present interest in
UMI, subject, however, to the receipt of all necessary regulatory approvals,
including Commission authorization under the Act. Following the acquisition,
UMICO would, therefore, become a nonutility subsidiary of GPU.
D. The purchase of workers' compensation insurance through UMI has
resulted in economies and cost savings to the GPU system companies in that the
current period costs of obtaining such insurance from UMI have been more
economical or, at least, comparable to the commercial market, particularly since
any "profits" earned by UMI, as a mutual insurer, have been returned to its
policyholders through annual dividends. As such, UMI has been providing, and for
a period of time, following UMI's demutualization, an affiliate of Cologne Re
would continue to provide at least through 2003, GPU with workers' compensation
insurance at rates approved by the New York State Insurance Department and
which, in any event, would be in accordance with the requirements of Section
13(b) and Rules 90 and 91 under the Act.
E. Consequently, by this application, GPU proposes to acquire shares of
common stock, $.01 par value, of UMICO in exchange for all of its current
interests in UMI. GPU would not pay any other consideration for the UMICO
shares.
Rule 54 Analysis.
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The proposed transactions contemplate, among other things, the
acquisition of securities by GPU which do not relate to exempt wholesale
generators ("EWGs") and foreign utility companies ("FUCOs") (the
"Transactions"). Accordingly, the Transactions are subject to Rule 54, which
provides that, in determining whether to approve an application which does not
relate to any EWG or FUCO, the Commission shall not consider the effect of the
capitalization or earnings of any such EWG or FUCO which is a subsidiary of a
registered holding company if the requirements of Rule 53 (a), (b) and (c) are
satisfied.
(a) As described below, GPU meets all of the conditions of
Rule 53, except for Rule 53(a)(1). By Order dated November 5, 1997 (HCAR No.
35-26773) (the "November 5 Order"), the Commission authorized GPU to increase to
100% of its "average consolidated
<PAGE>
retained earnings," as defined in Rule 53, the aggregate amount which it may
invest in EWGs and FUCOs. At December 31, 1999, GPU's average consolidated
retained earnings was approximately $2.416 billion and GPU's aggregate
investment in EWGs and FUCOs was approximately $2.172 billion. Accordingly,
under the November 5 Order, GPU may invest up to an additional $244 million in
FUCOs as of December 31, 1999.
(i) 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.
(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,
<PAGE>
to the 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,
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.
(ii) 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.
(iii) Copies of this Application on Form U-1 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.(3) In
addition, GPU will submit to each such commission copies of
any amendments to this Application and 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).
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(3) Penelec is also subject to retail rate regulation by the New York Public
Service Commission with respect to retail service to approximately 3,700
customers in Waverly, New York served by Waverly Electric Power & Light Company,
a Penelec subsidiary. Waverly Electric's revenues are immaterial, accounting for
less than 1% of Penelec's total operating revenues.
<PAGE>
(iv) 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
having a book value exceeding 10% of GPU's consolidated
retained earnings 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 $2.146 billion) represented an increase of
approximately $49 million (or approximately 2%) compared to
the average consolidated retained earnings for the previous
four quarterly periods (approximately $2.367 billion).
(C) GPU did not incur operating losses from
direct or indirect investments in EWGs and FUCOs in 1998 in
excess of 5% of GPU's December 31, 1999 consolidated retained
earnings.
As described above, GPU meets all the conditions of Rule 53(a), except
for clause (1). With respect to clause (1), the Commission determined in the
November 5 Order that GPU's financing of investments in EWGs and FUCOs in an
amount greater than 50% of GPU's average consolidated retained earnings as
otherwise permitted by Rule 53(a)(1) would not have either of the adverse
effects set forth in Rule 53(c).
Moreover, even if the effect of the capitalization and earnings of
subsidiary EWGs and FUCOs were considered, there is no basis for the Commission
to withhold or deny approval for the transactions proposed in this Declaration.
The Transactions would not, by themselves, or even considered in conjunction
with the effect of the capitalization and earnings of GPU's subsidiary EWGs and
FUCOs, have a material adverse effect on the financial integrity of the GPU
system, or an adverse impact on GPU's public utility subsidiaries, their
customers, or the ability of State commissions to protect such public utility
customers.
The November 5 Order was predicated, in part, upon the assessment of
GPU's overall financial condition which took into account, among other factors,
GPU's consolidated capitalization ratio and the recent growth trend in GPU's
retained earnings. As of June 30, 1997, the most recent quarterly period for
which financial statement information was evaluated in the November 5 Order,
GPU's consolidated capitalization consisted of 49.2% equity and 50.8% debt. As
stated in the November 5 Order, GPU's
<PAGE>
June 30, 1997 pro forma capitalization, reflecting the November 6, 1997
acquisition of PowerNet Victoria, was 39.3% equity and 61.7% debt.
At December 31, 1999, GPU's common equity and debt represented 30.2%
and 66.2%, respectively, of its consolidated capitalization. As set forth in
Exhibit H hereto, GPU expects its common equity ratio to increase during 2000 to
approximately 35% of consolidated capitalization, principally as a result of the
planned sale of certain FUCO investments. Thus, since the date of the November 5
Order, there has been no material adverse change in GPU's consolidated
capitalization ratio, which remains within acceptable ranges and limits as
evidenced by the credit ratings of GPU's electric utility subsidiaries.(4)
GPU's consolidated retained earnings grew on average approximately 6.5%
per year from 1994 through 1999. Earnings attributable to GPU's investments in
EWGs and FUCOs have contributed positively to consolidated earnings.
Accordingly, since the date of the November 5 Order, the capitalization
and earnings attributable to GPU's investments in EWGs and FUCOs have not had
any adverse impact on GPU's financial integrity.
Reference is made to Exhibit H which sets forth GPU's consolidated
capitalization at December 31, 1999 and after giving effect to the transactions
proposed herein. As set forth in such exhibit, the proposed transactions will
not have a material impact on GPU's capitalization or earnings.
ITEM 2. FEES, COMMISSIONS AND EXPENSES.
------------------------------
The estimated fees, commissions and expenses expected to be
incurred in connection with the proposed transactions will be filed by
amendment.
- --------------------
(4) The first mortgage bonds of JCP&L, Met-Ed and Penelec are rated A+ by
Standard & Poors Corporation, and Baa1, A3 and A2, respectively;, by Moody's
Investors Service, Inc.
<PAGE>
ITEM 3. APPLICABLE STATUTORY PROVISIONS.
-------------------------------
GPU believes that Sections 9(a)(1) and 10 of the Act and Rule
54 thereunder may be applicable to the proposed Transactions. GPU does not
believe that Section 11(b) of the Act is applicable to its acquisition of the
UMICO shares as it will not result in the acquisition by GPU of an interest in
any other business. UMI has been providing workers compensation insurance to GPU
and its subsidiaries since the 1920s and is not currently engaged in any
business other than providing workers compensation insurance to its own
employees.
ITEM 4. REGULATORY APPROVALS.
--------------------
No state commission has jurisdiction with respect to any
aspect of the Transactions and no Federal commission, other than your
Commission, has jurisdiction with respect to any aspect thereof. The New York
State Insurance Department must authorize the "demutualization" of UMI.
ITEM 5. PROCEDURE.
---------
GPU requests that the Commission issue an order with respect
to the transactions proposed herein at the earliest practicable date, but in no
event no later than April 15, 2000. 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.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS.
---------------------------------
Exhibits:
A(1) - Certificate of Incorporation of
UMICO Holdings, Inc. - to be filed
by amendment.
A(2) - By-Laws of UMICO Holdings, Inc. -
to be filed by amendment.
B - Form of Subscription Agreement for
UMICO Holdings, Inc. - to be filed
by amendment.
C - Not applicable
<PAGE>
D - Not applicable
E - Not applicable
F(1) - Opinion of Berlack, Israels &
Liberman LLP -- to be filed by
amendment.
F(2) - Opinion of Ryan, Russell, Ogden &
Seltzer LLP -- to be filed by
amendment.
G - Not applicable
H - Capitalization and Capitalization
Ratios as at December 31, 1999,
actual and pro forma.
I - Form of public notice.
Financial Statements:
1-A - GPU and Subsidiary Companies
Consolidated Balance Sheets, actual
and pro forma, as at December 31,
1999, and Consolidated Statement of
Income and Retained Earnings, actual
and pro forma, for the twelve months
ended December 31, 1999; pro forma
journal entries - Omitted, since the
transaction will have no material
effect on such financial statements.
1-B - GPU (Corporate) Balance Sheets,
actual and pro forma, as at December
31, 1999 and Statements of Income
and Retained Earnings, actual and
pro forma, for the twelve months
ended December 31, 1999; pro forma
journal entries -- Omitted, since
the transaction will have no
material effect on such financial
statements.
2 - Reference is made to the financial
statements included in 1 above.
3 - None, except as set forth in the
Notes to the Financial Statements.
<PAGE>
ITEM 7. INFORMATION AS TO ENVIRONMENTAL EFFECTS.
---------------------------------------
(a) The proposed Transactions contemplate the acquisition by
GPU of securities in an insurance holding company. 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.
(b) No Federal agency has prepared or is preparing an
environmental impact statement with respect to the proposed Transactions which
are the subject hereof.
<PAGE>
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY HOLDING
COMPANY ACT OF 1935, THE UNDERSIGNED COMPANY HAS DULY CAUSED THIS STATEMENT TO
BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
GPU, INC.
By: /s/ T. G. Howson
----------------
T. G. Howson,
Vice President and Treasurer
Date: February 18,2000
Exhibit Index
H - Capitalization and Capitalization Ratios as at December 31, 1999,
actual and pro forma.
I - Form of public notice.
Exhibit I
SECURITIES AND EXCHANGE COMMISSION
(RELEASE NO. 35-________); 70-
GPU, Inc., 300 Madison Avenue, Morristown, New Jersey 07960, a
registered holding company, has filed with the Commission an Application
pursuant to Sections 9(a)(1) and 10 of the Public Utility Holding Company Act of
1935 ("Act") and Rule 54 thereunder.
GPU and its various subsidiary companies currently purchase
workers compensation insurance from Utilities Mutual Insurance Company ("UMI"),
a captive mutual insurer providing insurance to a limited number of
companies(5), and have been doing so since the 1920's. UMI is in the process of
obtaining approval from the New York State Department of Insurance to convert
from a mutual company to stock company status. It is UMI's intent that once it
becomes a stock company, each policy holder would receive shares of common
stock, $.01 par value, of a newly-formed holding company parent, UMICO Holdings,
Inc. ("UMICO"), which will be incorporated under New York law, in proportion to
their current ownership interest in UMI.
In connection with its demutualization, UMI intends to sell
its entire insurance portfolio to Cologne Re, which would then assume all UMI
obligations and liabilities for outstanding claims and future claims under
policies written by UMI. Thereafter, UMI will not conduct any active business
and the workers compensation insurance previously provided by UMI to its members
will instead be provided by an affiliate of Cologne Re to the UMICO shareholders
at least through 2003. It is expected, however, that UMI and UMICO would not be
liquidated and dissolved and would remain in existence until all claims or
potential claims covered by outstanding UMI policies have either been resolved
or adequately reinsured to the satisfaction of the New York Department of
Insurance. Upon dissolution, the UMICO shareholders would be entitled to their
pro rata shares of any remaining UMI surplus.
- --------------------
(5) In addition to GPU and its subsidiaries, the current UMI members and
policy holders are South Jersey Industries, Inc., Central Hudson Gas & Electric
Corp., Empire State Electric Energy Research Corp., Griffith Oil Co., Long
Island Water Corp., Middleburg Telephone, New York State Electric & Gas Corp.,
Niagara Mohawk Power Corp., Rochester Gas & Electric Corp. and Fi-Net
Technologies.
<PAGE>
GPU and its subsidiaries(6) currently have an aggregate
ownership interest in UMI of approximately 36% and would, therefore, receive
approximately 36% of UMICO's voting shares upon UMI's demutualization. In order
to more efficiently manage and administer its workers compensation insurance
programs, prior to demutualization, the GPU subsidiaries (other than Prime and
Onondaga) have assigned their present interests in UMI to GPU. In contemplation
of the pending demutualization, GPU and the other utility policy holders have
entered into a subscription agreement providing for their purchase of shares of
UMICO in proportion to their respective interests in UMI. Under the subscription
agreement, GPU has agreed to acquire approximately 36.52% of UMICO in exchange
for its present interest in UMI, subject, however, to the receipt of all
necessary regulatory approvals, including Commission authorization under the
Act. Following the acquisition, UMICO would, therefore, become a nonutility
subsidiary of GPU.
The purchase of workers' compensation insurance through UMI
has resulted in economies and cost savings to the GPU system companies in that
the current period costs of obtaining such insurance from UMI have been more
economical or, at least, comparable to the commercial market, particularly since
any "profits" earned by UMI, as a mutual insurer, have been returned to its
policyholders through annual dividends. As such, UMI has been providing, and for
a period of time, following UMI's demutualization, an affiliate of Cologne Re
would continue to provide at least through 2003, GPU with workers' compensation
insurance at rates approved by the New York State Insurance Department and
which, in any event, would be in accordance with the requirements of Section
13(b) and Rules 90 and 91 under the Act.
Consequently, by this application, GPU proposes to acquire
shares of common stock, $.01 par value, of UMICO in exchange for all of its
current interests in UMI. GPU would not pay any other consideration for the
UMICO shares.
- --------------------
(6) The GPU subsidiaries are the following: GPU Advanced Resources, Inc.,
Metropolitan Edison Company, Pennsylvania Electric Company, Jersey Central Power
& Light Company, GPU International, Inc., GPU Service, Inc., GPU Nuclear, Inc.,
Prim e Energy Limited Partnership ("Prime") and Onondaga Cogeneration Limited
Partnership ("Onondaga").
<PAGE>
The Application, as amended, is available for public
inspection through the Commission's Office of Public Reference. Interested
persons wishing to comment or request a hearing should submit their views in
writing by ________________, 2000 to the Secretary, Securities and Exchange
Commission, Washington, D.C. 20549, and serve a copy on the applicant at the
address specified above. Proof of service (by affidavit, or in case of an
attorney at law, by certificate) should be filed with the request. Any request
for a 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 this matter. After said
date, the Application, as amended, may be granted.
EXHIBIT H
Page 1 of 2
<TABLE>
GPU, INC. CONSOLIDATED
ACTUAL AND PRO FORMA CAPITALIZATION
(IN THOUSANDS)
<CAPTION>
The actual and pro forma capitalization of GPU, Inc. and Subsidiary Companies at December 31, 1999 is as follows:
Actual Pro Forma(1)
--------------- ---------------
Amount % Amount %
------ --- ------ ---
<S> <C> <C> <C> <C>
Long-term debt $ 6,420,910 56.0% $5,365,228 56.5%
Notes payable 1,171,869 10.2% 385,832 4.0%
Trust preferred securities 200,000 1.7% 200,000 2.1%
Subsidiary-obligated mantadorily
Redeemable preferred securities 125,000 1.1% 125,000 1.3%
Preferred stock 96,649 0.8% 96,649 1.0%
Common equity 3,464,953 30.2% 3,339,953 35.1%
---------- ----- --------- -----
Total $11,479,381 100.0% $9,502,662 100.0%
========== ===== ========= =====
(1) Reflects the following adjustments:
(a) The sale in April 2000 of GPU Powernet and GPU Gasnet for their book value of $2,389 million (which amount includes
the related acquisition and other debt).
(b) GPU acquisition of MYR Group Inc., for $225 million in cash for which authorization is being sought in SEC File No.
70-9599.
(c) The issuance through a JCP&L affiliate of asset securitization bonds for $587 million in the third quarter of 2000.
(d) GPU common stock repurchases of up to $125 million from time to time as subject to favorable market conditions
following the sale of the Australian assets.
</TABLE>
EXHIBIT H Page 2 of 2
<TABLE>
GPU ENERGY SUBSIDIARIES
ACTUAL AND PRO FORMA CAPITALIZATION
(IN THOUSANDS)
<CAPTION>
The actual and pro forma capitalization of JCP&L, Met-Ed and Penelec
Companies at December 31, 1999 is as follows:
JCP&L
Actual Pro Forma(1)
--------------- ---------------
Capitalization Amount % Amount %
- -------------- ------ --- ------ ---
<S> <C> <C> <C> <C>
Long-term debt $1,173,773 42.2% $1,561,773 52.6%
Notes payable - 0.0% - 0.0%
Trust preferred securities - 0.0% - 0.0%
Subsidiary-obligated mantadorily
redeemable preferred securities 125,000 4.5% 125,000 4.2%
Preferred stock 96,649 3.5% 96,649 3.3%
Common equity 1,385,367 49.8% 1,185,367 39.9%
--------- ----- --------- -----
Total $2,780,789 100.0% $2,968,789 100.0%
========= ===== ========= =====
(1) Includes the Asset Securitization Issuance of $587 million less a paydown on debt of $199 million.
Met-Ed
Actual Pro Forma
--------------- ---------------
Capitalization Amount % Amount %
- -------------- ------ --- ------ ---
<S> <C> <C> <C> <C>
Long-term debt $ 546,908 47.6% $ 596,908 52.0%
Notes payable - 0.0% 105,000 9.1%
Trust preferred securities 100,000 8.7% 100,000 8.7%
Subsidiary-obligated mantadorily
redeemable preferred securities - 0.0% - 0.0%
Preferred stock - 0.0% - 0.0%
Common equity 501,417 43.7% 346,417 30.2%
--------- ----- --------- -----
Total $1,148,325 100.0% $1,148,325 100.0%
========= ===== ========= =====
Penelec
Actual Pro Forma
--------------- ---------------
Capitalization Amount % Amount %
- -------------- ------ --- ------ ---
<S> <C> <C> <C> <C>
Long-term debt $ 424,654 40.9% $ 474,654 45.7%
Notes payable 53,600 5.2% 148,600 14.3%
Trust preferred securities 100,000 9.6% 100,000 9.6%
Subsidiary-obligated mantadorily
redeemable preferred securities - 0.0% - 0.0%
Preferred stock - 0.0% - 0.0%
Common equity 461,182 44.4% 316,182 30.4%
--------- ----- --------- -----
Total $1,039,436 100.0% $1,039,436 100.0%
========= ===== ========= =====
</TABLE>