<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
AMENDMENT NO. 1
TO FORM 8-K FILED OCTOBER 26, 1998
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 9, 1998
Cogeneration Corporation of America
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-9208 59-2076187
(State or other (Commission File Number) (IRS Employer
jurisdiction of incorporation) Identification Number)
One Carlson Parkway, Suite 240, Minneapolis, Minnesota 55447-4454
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(612) 745-7900
- ------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
On October 9, 1998, CogenAmerica Pryor, Inc. ("CogenAmerica Pryor"), a
wholly-owned subsidiary of Cogeneration Corporation of America ("CogenAmerica"),
acquired from Mid-Continent Power Company, LLC ("MCPC LLC") the entire interest
in a 110 MW cogeneration project located in the Mid-America Industrial Park, in
Pryor, Oklahoma (the "Pryor Project"). This Amendment No. 1 on Form 8-K/A
("Amendment No. 1") amends and supersedes "Item 7. Financial Statements, Pro
Forma Financial Information and Exhibits" of the Current Report on Form 8-K
dated October 9, 1998 and filed by CogenAmerica on October 26, 1998. This
Amendment No. 1 is filed to furnish financial statements and combined pro forma
financial information related to the acquisition of the Pryor Project.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements.
2
<PAGE>
PRYOR PROJECT
STATEMENT OF ASSETS ACQUIRED AND LIABILITIES ASSUMED AND STATEMENT OF
REVENUES AND DIRECT OPERATING EXPENSES
SEPTEMBER 30, 1998
3
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
Cogeneration Corporation of America
We have audited the accompanying statement of assets acquired and liabilities
assumed of the Pryor Project ("Successor") as of September 30, 1998 and December
31, 1997 and the related statement of revenues and direct operating expenses of
the Successor for the nine months ended September 30, 1998 and the statement of
revenues and direct operating expenses of the Pryor Project ("Predecessor") for
the year ended December 31, 1997. These financial statements are the
responsibility of the Pryor Project's management. Our responsibility is to
express an opinion on these statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of assets acquired and liabilities assumed
and the statement of revenues and direct operating expenses are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in these statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of these statements.
We believe that our audit provides a reasonable basis for our opinion.
The accompanying statements were prepared for the purpose of complying with the
rules and regulations of the Securities and Exchange Commission for the
inclusion in a current report on Form 8-K of Cogeneration Corporation of America
as described in Note 2 and are not intended to be a complete presentation of the
Pryor Project's assets and liabilities or revenues and expenses.
In our opinion, such statements referred to above present fairly, in all
material respects, the assets acquired and liabilities assumed of the Successor
as of September 30, 1998 and December 31, 1997 and the revenues and direct
operating expenses of the Successor for the nine months ended September 30, 1998
and the revenues and direct operating expenses of the Predecessor for the year
ended December 31, 1997, as described in Note 2, in conformity with generally
accepted accounting principles.
PricewaterhouseCoopers LLP
Minneapolis, Minnesota
December 15, 1998
4
<PAGE>
PRYOR PROJECT
STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES
(IN THOUSANDS)
<TABLE>
<CAPTION>
SUCCESSOR PREDECESSOR
--------- -----------
NINE MONTHS
ENDED YEAR ENDED
SEPTEMBER 30, DECEMBER 31,
1998 1997
<S> <C> <C>
Revenues $ 12,446 $ 10,139
Cost of revenues:
Fuel, production and transmission costs 7,991 6,280
Operation and maintenance 2,140 3,693
Depreciation 616 1,164
---------- -----------
10,747 11,137
---------- -----------
Gross profit 1,699 (998)
Selling, general and administrative expenses 793 1,328
---------- -----------
Revenues in excess of (less than) direct
operating expenses $ 906 $ (2,326)
---------- -----------
---------- -----------
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE>
PRYOR PROJECT
STATEMENT OF ASSETS ACQUIRED AND LIABILITIES ASSUMED
(IN THOUSANDS)
<TABLE>
<CAPTION>
SUCCESSOR
------------------------------
SEPTEMBER 30, DECEMBER 31,
1998 1997
ASSETS ACQUIRED
<S> <C> <C>
Current assets:
Accounts receivable $ 311 $ 842
Other current assets 36 16
---------- -----------
Total current assets 347 858
Property, plant and equipment net of accumulated
depreciation of $616 and $0, respectively 16,447 15,906
Deposits 124
---------- -----------
Total assets acquired $ 16,794 $ 16,888
---------- -----------
---------- -----------
LIABILITIES ASSUMED
Current liabilities:
Accounts payable $ 1,348 $ 778
Accrued expenses 130 25
Current portion of capital lease obligations 19 9
---------- -----------
Total current liabilities 1,497 812
Capital lease obligations 22 17
---------- -----------
Total liabilities assumed $ 1,519 $ 829
---------- -----------
---------- -----------
Net assets $ 15,275 $ 16,059
---------- -----------
---------- -----------
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE>
PRYOR PROJECT
NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)
1. BUSINESS DESCRIPTION
The Pryor Project (the "Project") is a steam and electric generating
facility at the Mid-America Industrial Park in Mayes County, Oklahoma,
consisting of several gas and steam turbines that have an aggregate rated
capacity of 130 megawatts. The Project generates and sells electric power,
steam, compressed air and softened water under contracts to utilities and
industrial and commercial users. The Project may also sell excess electric
capacity and energy on a merchant basis.
At September 30, 1998, the Project was owned by Oklahoma Loan Acquisition
Corporation ("OLAC"), which was a wholly-owned subsidiary of Mid-Continent
Power Company L.L.C. ("MCPC L.L.C.") OLAC acquired the Project from
Mid-Continent Power Company, Inc. ("MCPC") on December 31, 1997 pursuant to
MCPC's bankruptcy reorganization plan (see Note 3). On October 9, 1998,
CogenAmerica Pryor, Inc. ("Cogen Pryor"), a wholly owned subsidiary of
Cogeneration Corporation of America ("CogenAmerica"), acquired the Project
by purchasing all of the capital stock of OLAC (see Note 6).
Pursuant to a 10-year contract commencing January 1, 1998, the Project
provides 110 megawatts of standby capacity with a maximum dispatch of 1,500
hours per year to Oklahoma Gas and Electric (OG&E). OG&E pays the Project a
monthly capacity charge for assured delivery of energy during term of the
contract and an energy charge for dispatched electricity. Upon 6 months
advance notice, OG&E may extend the contract for an additional five years.
MCPC also has contracts with six customers in the Mid-America Industrial
Park for the sale of steam, compressed air and softened water. The
contracts vary in length and have varying expiration dates.
During 1997, MCPC provided standby capacity and electric energy to Public
Service of Oklahoma ("PSO"). This agreement expired on December 31, 1997,
however, the Project continues to supply excess electric power to PSO.
2. BASIS OF PRESENTATION
The statement of assets acquired and liabilities assumed and statement of
revenues and direct operating expenses have been prepared for inclusion in
a Current Report on Form 8-K of CogenAmerica to be filed with the
Securities Exchange Commission. The accompanying statements have been
prepared in accordance with generally accepted accounting principles and
were derived from the historical accounting records of OLAC and MCPC. The
statements are intended to present the business of the Project acquired by
Cogen Pryor.
<PAGE>
OLAC's acquisition of the Project from MCPC on December 31, 1997 was
accounted for by the purchase method (see Note 3). The purchase price was
assigned to the assets acquired and liabilities assumed based on their fair
values at the acquisition date. The fair value of the net assets acquired
exceeded the purchase price and such excess was allocated to reduce the
value assigned to property, plant and equipment.
The statement of assets acquired and liabilities assumed includes all
assets and liabilities of OLAC as of the statement dates, except cash,
income taxes and obligations payable to OLAC's parent and affiliates
thereof (the "excluded obligations"). Pursuant to the stock acquisition
agreement, immediately prior to Cogen Pryor's acquisition of OLAC the
excluded obligations were repaid to the extent of available cash and the
unpaid amount was contributed to OLAC's capital.
The statement of revenues and direct operating expenses includes the
revenues and expenses of the Project directly attributable to the
generation and sale of electric power, steam, compressed air and softened
water. The statement for the nine months ended September 30, 1998 was
derived from the accounting records of OLAC and does not include interest
income, interest expense or income taxes. Depreciation in the amount of
$616 included in cost of revenues for the nine months ended September 30,
1998 is based on OLAC's successor cost basis in the Project determined by
purchase accounting. The statement for the year ended December 31, 1997 was
derived from the accounting records of MCPC and does not include interest
income, interest expense, income taxes (MCPC was a subchapter S
corporation) or any revenues, expenses, costs or income incidental to
MCPC's bankruptcy filing and reorganization plan. Depreciation in the
amount of $1,163 included in cost of revenues for the year ended December
31, 1997 is based on MCPC's predecessor cost basis in the Project.
3. MCPC BANKRUPTCY
CHAPTER 11 BANKRUPTCY FILING
On June 18, 1997 ("Petition Date"), MCPC filed a petition with the United
States Bankruptcy Court for the Northern District of Oklahoma ("Bankruptcy
Court") for protection under Chapter 11 of the Federal Bankruptcy Code.
Upon filing of the voluntary petition for relief, MCPC, as
debtor-in-possession, was authorized to operate its business for the
benefit of claim holders and interest holders, and no trustee was
appointed. All debts of MCPC as of the Petition Date were stayed by the
bankruptcy petition and subject to compromise pursuant to such proceedings.
MCPC operated its business and managed its assets in the ordinary course as
debtor-in-possession, and was required to obtain court approval for
transactions outside the ordinary course of business.
<PAGE>
PLAN OF REORGANIZATION
MCPC filed with the Bankruptcy Court the First Amended Plan of
Reorganization on September 18, 1997, as amended and restated by the Second
Amended Plan of Reorganization (the "Plan") filed on October 24, 1997. The
Bankruptcy Court approved the Plan on October 24, 1997 and it became
effective and was executed in two phases on December 23, 1997 and December
31, 1997.
The Plan contemplated (i) the sale of the cogeneration facility, certain
assumed pre- and post-petition contracts related to the Project, and all
other assets of MCPC to OLAC in satisfaction of OLAC's secured claim in the
amount of $15,000 and (ii) satisfaction of all other creditor claims
according to the creditor classes and payment amounts detailed in the Plan.
The cash requirements of the Plan would be funded by the unencumbered cash
held by MCPC, with any deficiency funded by OLAC. Upon payment and
satisfaction of all creditor claims and transfer of the assets and
contracts to OLAC, MCPC would be dissolved.
On December 23, 1997 OLAC advanced $2,231 to MCPC and MCPC paid all
pre-petition and substantially all post-petition liabilities (excluding
OLAC's claims) presented for payment as of that date. On December 31, 1997,
MCPC sold all of its assets (excluding cash required to fund remaining
creditor claims) and assigned certain assumed pre- and post-petition
contracts to OLAC in satisfaction of OLAC's secured claim. MCPC was
subsequently dissolved in January 1998.
As a result of the plan of reorganization, OLAC assumed all post-petition
liabilities of MCPC presented for payment subsequent to December 23, 1997.
On December 31, 1997 OLAC acquired MCPC's assets and the assumed contracts.
OLAC accounted for the transactions underlying the Plan by the purchase
method of accounting. The purchase price of $16,227 was determined from the
carrying amount of OLAC's claims and costs related to the Plan.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GOING CONCERN CONSIDERATIONS
The accompanying statement of assets acquired and liabilities assumed and
statement of revenues and direct operating expenses of the Project have
been prepared on a going concern basis, which contemplates the realization
of assets and the liquidation of liabilities in the ordinary course of
business. As described in Note 3 above, MCPC filed for reorganization under
Chapter 11 of the Unites States Bankruptcy Code on June 18, 1997 and
consummated the plan on December 31, 1997. The financial statements do not
include any adjustments
<PAGE>
relating to recoverability and classification of reported asset amounts or
the amounts and classification of liabilities that resulted from the
ultimate resolution of the Plan.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are recorded at cost and are depreciated by
the straight line method over the estimated useful life of the related
asset or, for leasehold improvements, over the term of the lease, if
shorter. Pursuant to purchase accounting, a new cost basis was established
on December 31, 1997 following consummation of the Plan (see Note 3). The
estimated useful life of the facility at January 1, 1998 and 1997 was 21
and 22 years, respectively.
SIGNIFICANT CUSTOMERS AND CONCENTRATION OF CREDIT RISK
In the nine months ended September 30, 1998, and year ended December 31,
1997, sales to a certain customer totaled 30%, and 47% of revenues,
respectively. In the nine months ended September 30, 1998, sales to another
customer totaled 53% of revenues. In the year ended December 31, 1997,
sales to two additional customers totaled 23% and 10% of revenues,
respectively.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Project's financial instruments primarily consist of short-term trade
receivables and payables whose carrying amounts approximate fair value.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those estimates.
<PAGE>
5. LEASES
Future minimum lease payments under noncancelable operating and capital
leases for the three months ending December 31, 1998 and the years
thereafter are as follows:
<TABLE>
<CAPTION>
PERIOD CAPITAL OPERATING TOTAL
- --------------------------------------------------------------- ----------------- ---------------- -----------------
<S> <C> <C> <C>
Three months ended December 31, 1998.............. $ 5 $ 6 $ 11
1999.............................................. 20 22 42
2000.............................................. 16 20 36
2001.............................................. 4 20 24
2002.............................................. 20 20
-------- ------- ------
Total minimum lease payments...................... 45 $ 88 $ 133
------- ------
------- ------
Less amounts representing interest................ (4)
--------
Present value of minimum lease payments........... 41
Less current maturities........................... (19)
--------
Long-term capital lease obligations............... $ 22
--------
--------
</TABLE>
6. RELATED PARTY TRANSACTIONS
NRG Oklahoma Operations, Inc.("NRG Oklahoma") provided services to the
Project pursuant to an operation and management consulting agreement
commencing January 1, 1998. Such services totaled $425 for the nine months
ended September 30, 1998, and are included in operation and maintenance
expense. The operation and management consulting agreement was terminated
effective October 9, 1998 in connection with CogenAmerica Pryor's
acquisition of the Project (see Note 7). NRG Oklahoma is a subsidiary of
NRG Energy, Inc., which owns 50% of the capital stock of MCPC L.L.C.
7. SUBSEQUENT EVENTS
On October 9, 1998, Cogen Pryor acquired all of the issued and outstanding
capital stock of OLAC from MCPC L.L.C. for a cash purchase price of
$23,830, financed through borrowings from NRG Energy, Inc. The facility
will continue to generate and sell electric power, steam, compressed air
and softened water with Cogen Pryor assuming all of the electric power and
steam contracts of the Project.
<PAGE>
(b) Pro Forma Financial Information.
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The following unaudited pro forma financial information relates to the Company's
October 9, 1998 acquisition of the capital stock of Oklahoma Loan Acquisition
Corporation ("OLAC"), a wholly owned subsidiary of MCPC LLC. The transaction
will be accounted for as a purchase business combination. The pro forma amounts
have been prepared based on certain purchase accounting and other pro forma
adjustments as described in the accompanying notes to the pro forma consolidated
financial statements. The pro forma adjustments were applied to the historical
consolidated financial statements of the Company and the historical statements
of the Pryor Project. The historical statements of the Pryor Project consist of
a statement of assets acquired and liabilities assumed and the related
statements of revenues and direct operating expenses. Such statements were
derived from the accounting records of OLAC and Mid-Continent Power Company,
Inc. as described in Note 2 to the audited statements of the Pryor Project.
The unaudited pro forma balance sheet at September 30, 1998 reflects the
historical financial position of the Company and historical assets acquired and
liabilities assumed of the Pryor Project as if the acquisition had occurred as
of the balance sheet date. The unaudited pro forma statements of operations for
the nine months ended September 30, 1998 and year ended December 31, 1997
reflect the historical results of operations of the Company and the historical
revenues and direct operating expenses of the Pryor Project with pro forma
acquisition adjustments as if the acquisition had occurred on January 1, 1998
and January 1, 1997, respectively. The pro forma adjustments are described in
the accompanying notes and give effect to events that are (a) directly
attributable to the acquisition, (b) factually supportable, and (c) in the case
of certain statement of operations adjustment, expected to have a continuing
impact.
The unaudited pro forma financial statements should be read in connection with
the Company's historical financial statements and related footnotes and the
historical financial statements and related footnotes of the Pryor Project.
The unaudited pro forma financial information presented herein is for
information purposes. Such information does not purport to represent what the
Company's and the Pryor Project's financial position or results of operations as
of the dates presented would have been had the acquisition occurred on such date
or at the beginning of the period indicated or to project the Company's and the
Pryor Project's financial position or results of operations for any future date
or period.
<PAGE>
COGENERATION CORPORATION OF AMERICA
PRO FORMA CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 1998
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
ACQUIRED
ASSETS AND
LIABILITIES
-----------
ACTUAL ACTUAL PRO FORMA PRO FORMA
COGENAMERICA PRYOR PROJECT ADJUSTMENTS CONSOLIDATED
ASSETS
<S> <C> <C> <C> <C>
Current Assets:
Cash and cash equivalents $ 3,417 $ 3,417
Restricted cash and cash equivalents 11,178 11,178
Accounts receivable, net 13,155 $ 311 $ 390 (a) 13,856
Receivables from related parties 146 146
Notes receivable, current 3 3
Inventories 2,368 2,368
Other current assets 729 36 765
-------------- ------------- ----------- -------------
Total current assets 30,996 347 390 31,733
Property, plant and equipment, net 123,518 16,447 16,451 (a) 156,416
Property under construction 92,853 92,853
Project development costs 731 (689) (b) 42
Investments in equity affiliates 17,638 17,638
Deferred financing costs, net 6,008 167 (c) 6,175
Deferred tax assets 7,996 (7,200) (a) 796
Other assets 516 516
-------------- ------------- ----------- -------------
Total assets $ 280,256 $ 16,794 $ 9,119 $ 306,169
-------------- ------------- ----------- -------------
-------------- ------------- ----------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of loans and payables due
NRG Energy Inc. $ 2,041 $ - $ 50 (c) $ 2,091
Current portion of non-recourse long-term debt 9,339 19 9,358
Current portion of recourse long-term debt 408 408
Short term borrowings 2,594 2,594
Accounts payable 17,279 1,348 282 (a) 18,909
Prepetition liabilities 797 797
Other current liabilities 2,765 130 115 (b) 3,010
-------------- ------------- ----------- -------------
Total current liabilities 35,223 1,497 447 37,167
Loans due NRG Energy, Inc. 4,439 23,947 (a) 28,386
Nonrecourse long-term debt 212,463 22 212,485
Recourse long-term debt 25,000 25,000
-------------- ------------- ----------- -------------
Total liabilities 277,125 $ 1,519 $ 24,394 303,038
------------- -----------
------------- -----------
Stockholders' equity:
Preferred stock
New common stock 68 68
Additional paid-in capital 65,715 65,715
Retained earnings (accumulated deficit) (62,332) (62,332)
Accumulated other comprehensive income (loss) (320) (320)
-------------- -------------
Total stockholder's equity 3,131 3,131
-------------- -------------
Total liabilities and stockholders' equity $ 280,256 $ 306,169
-------------- -------------
-------------- -------------
</TABLE>
See accompanying notes to pro forma consolidated financial statements.
<PAGE>
COGENERATION CORPORATION OF AMERICA
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
REVENUES AND
DIRECT
OPERATING
EXPENSES
-------------
ACTUAL ACTUAL PRO FORMA PRO FORMA
COGENAMERICA PRYOR PROJECT ADJUSTMENTS CONSOLIDATED
<S> <C> <C> <C> <C>
Energy revenues $ 32,954 $ 12,446 $ 45,400
Equipment sales and service 14,571 14,571
Rental Revenues 2,208 2,208
-------------- ------------- ----------- -------------
49,733 12,446 62,179
-------------- ------------- ----------- -------------
Cost of energy revenues 11,905 10,747 $ 197 (d) 22,849
Cost of equipment sales and services 12,697 12,697
Cost of rental revenues 1,759 1,759
-------------- ------------- ----------- -------------
26,361 10,747 197 37,305
-------------- ------------- ----------- -------------
Gross profit 23,372 1,699 (197) 24,874
Selling, general and administrative expenses 5,923 793 (45) (e) 6,671
Provision for impaired assets - -
-------------- ------------- ----------- -------------
Income (loss) from operations 17,449 906 (152) 18,203
Interest and other income 684 684
Equity in earnings of affiliates 4,241 4,241
Interest and debt expense (10,543) (2,160) (f) (12,703)
-------------- ------------- ----------- -------------
Income (loss) before income taxes 11,831 906 (2,312) 10,425
Provision for income taxes (benefit) 4,571 (562) (g) 4,009
-------------- ------------- ----------- -------------
Net income (loss) $ 7,260 $ 906 $ (1,750) $ 6,416
-------------- ------------- ----------- -------------
-------------- ------------- ----------- -------------
Earnings per share:
Basic $ 1.06 $ 0.94
Diluted $ 1.04 $ 0.92
Weighted average share outstanding:
Basic 6,837 6,837
Diluted 6,983 6,983
</TABLE>
<PAGE>
COGENERATION CORPORATION OF AMERICA
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
REVENUES AND
DIRECT
OPERATING
EXPENSES
--------
ACTUAL ACTUAL PRO FORMA PRO FORMA
COGENAMERICA PRYOR PROJECT ADJUSTMENTS CONSOLIDATED
<S> <C> <C> <C> <C>
Energy revenues $ 43,210 $ 10,139 $ 53,349
Equipment sales and service 19,415 19,415
Rental Revenues 2,179 2,179
-------------- ------------- ----------- -------------
64,804 10,139 74,943
-------------- ------------- ----------- -------------
Cost of energy revenues 14,841 11,137 $ 575 (d) 26,553
Cost of equipment sales and services 17,037 17,037
Cost of rental revenues 1,817 1,817
-------------- ------------- ----------- -------------
33,695 11,137 575 45,407
-------------- ------------- ----------- -------------
Gross profit 31,109 (998) (575) 29,536
Selling, general and administrative expenses 9,479 1,328 (120) (e) 10,687
Provision for impaired assets 5,274 5,274
-------------- ------------- ----------- -------------
Income (loss) from operations 16,356 (2,326) (455) 13,575
Interest and other income 1,310 1,310
Interest and debt expense (14,768) (2,881) (f) (17,649)
-------------- ------------- ----------- -------------
Income (loss) before income taxes 2,898 (2,326) (3,336) (2,764)
Provision for income taxes (benefit) (20,454) (2,265) (g) (22,719)
-------------- ------------- ----------- -------------
Net income (loss) $ 23,352 $ (2,326) $ (1,071) $ 19,955
-------------- ------------- ----------- -------------
-------------- ------------- ----------- -------------
Earnings per share:
Basic $ 3.59 $ 3.06
Diluted $ 3.48 $ 2.97
Weighted average share outstanding:
Basic 6,511 6,511
Diluted 6,275 6,725
</TABLE>
<PAGE>
COGENERATION CORPORATION OF AMERICA
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
(Unaudited)
The following adjustments are related to the acquisition by CogenAmerica Pryor,
Inc., a wholly owned subsidiary of Cogeneration Corporation of America, of the
outstanding capital stock of Oklahoma Loan Acquisition Corporation.
1. UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET ADJUSTMENTS
(a) To record the October 9, 1998 acquisition of OLAC's outstanding
capital stock for a purchase price of $24,634, comprised of the
purchase price of $23,830 paid to MCPC LLC and transaction costs of
$804. To finance the acquisition, CogenAmerica issued a note payable
to NRG Energy, Inc. at the closing in the amount of $23,947. The note
amount is comprised of the cash purchase price due at closing of
$21,330, the purchase price deposit in the amount of $2,500 payable
upon entering into the stock purchase agreement on September 10, 1998
and which was financed by a note issued to NRG Energy, Inc.(the
"deposit loan"), accrued interest on the deposit loan through the
closing date in the amount of $17 and loan fees in the amount of $100.
The $24,634 purchase price has been allocated as follows:
<TABLE>
<CAPTION>
(THOUSANDS)
ASSETS ACQUIRED (LIABILITIES ASSUMED) VALUATION
------------------------------------- ---------
<S> <C>
Accounts receivable $ 701
Other current assets 36
Property, plant and equipment 32,898
Accounts payable (1,630)
Other current liabilities (130)
Nonrecourse long-term debt (41)
Deferred taxes (7,200)
-----------
$ 24,634
-----------
-----------
</TABLE>
(b) To reclass and accrue transaction costs incurred in connection with
the acquisition.
(c) To record financing costs associated with the note issued to NRG
Energy, Inc. to finance the acquisition.
2. UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS ADJUSTMENTS
(d) To record additional depreciation on property, plant and equipment
acquired based on the straight line method and an estimated useful
life of 20 years ($622 and $575 for the nine months ended September
30, 1998 and the year ended December 31, 1997, respectively) and to
eliminate costs that will not continue following the acquisition for
an operation and management consulting contract that was terminated
pursuant to the acquisition ($425 and $0 for the nine months ended
September 30, 1998 and the year ended December 31, 1997,
respectively).
<PAGE>
(e) To eliminate compensation costs that will not continue following the
acquisition. Such costs will be subsequently reimbursed by NRG Energy,
Inc.
(f) To record interest expense at 11.75% on the note issued to NRG Energy,
Inc. to finance the acquisition and amortization of related financing
costs.
(g) To record pro forma income tax benefit related to the operating
results of the acquired business at the statutory effective rate of
40%.
<PAGE>
(c) Exhibits.
<TABLE>
<CAPTION>
Exhibit
Number Description
- ----- -----------
<C> <C>
2.1 Stock Purchase Agreement dated September 10, 1998 between the Company
and MCPC LLC filed as Exhibit 2.1 to the Current Report on Form 8-K
dated October 9, 1998 and filed with the Commission on October 26,
1998, and incorporated herein by reference.
23 Consent of PricewaterhouseCoopers LLP.
</TABLE>
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
COGENERATION CORPORATION OF AMERICA
By: /s/ Timothy P. Hunstad
--------------------------------------------
Name: Timothy P. Hunstad
Title: Vice President and Chief Financial Officer
Date: March 26, 1999
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ----- -----------
<C> <C>
2.1 Stock Purchase Agreement dated September 10, 1998 between the Company
and MCPC LLC filed as Exhibit 2.1 to the Current Report on Form 8-K
dated October 9, 1998 and filed with the Commission on October 26,
1998, and incorporated herein by reference.
23 Consent of PricewaterhouseCoopers LLP.
</TABLE>
<PAGE>
Exhibit 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-38603) of Cogeneration Corporation of
America of our report dated December 15, 1998 appearing in this Form 8-K.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Minneapolis, Minnesota
March 25, 1999
