Amendment No. 1 to
SEC File No. 70-8533
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-1
DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 ("Act")
ENERGY INITIATIVES, INC. ("EI")
One Upper Pond Road
Parsippany, New Jersey 07054
NCP ENERGY, INC. ("NCP")
One Upper Pond Road
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 declarants)
B.L. Levy, President Douglas E. Davidson, Esq.
K.A. Tomblin, Secretary Berlack, Israels & Liberman
Energy Initiatives, Inc. 120 West 45th Street
NCP Energy, Inc. New York, New York 10036
One Upper Pond Road
Parsippany, New Jersey 07054
_________________________________________________________________
(Names and addresses of agents for service)<PAGE>
EI and NCP hereby amend their Declaration Form U-1, docketed
in SEC File No. 70-8533, as follows:
1. By filing the following financial statements in Item 6
thereof:
(b) Financial Statements:
1-A EI Consolidated Balance Sheets, actual and
pro forma, as at September 30, 1994, and
Consolidated Statements of Income, actual and
pro forma, and Statement of Retained
Earnings, for the twelve months ended
September 30, 1994; pro forma journal
entries.
1-B NCP Balance Sheets, actual and pro forma, as
at September 30, 1994 and Statements of
Income, actual and pro forma, and Statement
of Retained Earnings, for the twelve months
ended September 30, 1994; pro forma journal
entries.
1<PAGE>
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.
ENERGY INITIATIVES, INC.
NCP ENERGY, INC.
By:______________________________
Bruce L. Levy
President
Date: January 5, 1995<PAGE>
FINANCIAL STATEMENTS TO BE FILED BY EDGAR
Financial Statements:
1-A - EI Consolidated Balance Sheets, actual and
pro forma, as at September 30, 1994, and
Consolidated Statements of Income, actual and
pro forma, and Statement of Retained
Earnings, for the twelve months ended
September 30, 1994; pro forma journal
entries.
1-B - NCP Balance Sheets, actual and pro forma, as
at September 30, 1994 and Statements of
Income, actual and pro forma, and Statement
of Retained Earnings, for the twelve months
ended September 30, 1994; pro forma journal
entries.<PAGE>
Financial Statements
Item 6(b) 1-A
Page 1 of 9
ENERGY INITIATIVES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ACTUAL
AT SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments Pro
(Unaudited) (See Page 4) Forma
ASSETS
Property and equipment $ 720 $ - $ 720
Less, accumulated depreciation (336) - (336)
Net 384 - 384
Investment in partnerships 56 499 373 56 872
Current Assets:
Cash & temporary investments 1 912 30 000 31 912
Accounts receivable 1 700 - 1 700
Deferred Income Taxes 35 - 35
Prepayments & deposits 162 - 162
Other Current Assets 3 000 - 3 000
Total 6 809 30 000 36 809
Non-current Assets:
Investment in Securities 15 305 - 15 305
Intangible Assets 13 733 2 600 16 333
Other Investments 18 225 186 000 204 225
Long Term Receivables 2 128 - 2 128
Notes receivable 300 2 722 3 022
Cash Surrender Value of
Company Life Insurance 12 - 12
Deferred income taxes 1 113 - 1 113
Total 50 816 191 322 242 138
Total Assets $114 508 $ 221 695 $336 203
The accompanying notes are an integral part of the financial statements.<PAGE>
Financial Statements
Item 6(b) 1-A
Page 2 of 9
ENERGY INITIATIVES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ACTUAL
AT SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments Pro
(Unaudited) (See Page 4) Forma
LIABILITIES AND CAPITAL
Common Stock & Surplus:
Common stock $ 100 $ - $ 100
Paid in capital 112 634 191 695 304 329
Appropriated retained
earnings 7 492 7 492
Accumulated Deficit (14 221) (1 999) (16 220)
Total 106 005 189 696 295 701
Current Liabilities:
Accounts payable 1 340 - 1 340
Accrued vacation 233 - 233
Accrued bonuses 176 - 176
Interest payable 11 3 075 3 086
Notes payable - 30 000 30 000
Taxes accrued (888) (1 076) (1 964)
Deferred revenues 112 - 112
Total 984 31 999 32 983
Noncurrent Liabilities:
Deferred income taxes 5 009 - 5 009
Deferred compensation 54 - 54
Reserve for Equipment Disposal 246 - 246
Deferred revenue 2 210 - 2 210
Total 7 519 - 7 519
Total Liabilities and Capital $114 508 $ 221 695 $336 203
The accompanying notes are an integral part of the financial statements.<PAGE>
Financial Statements
Item 6(b) 1-A
Page 3 of 9
ENERGY INITIATIVES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
ACTUAL
FOR THE TWELVE MONTHS ENDED SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments Pro
(Unaudited) (See Page 4) Forma
Operating Revenues $ 4 016 $ - $ 4 016
Operating Expenses:
Operation and maintenance 6 302 - 6 302
Depreciation 272 - 272
Taxes other than income 311 - 311
Total 6 885 - 6 885
Net Operating Income (2 869) - (2 869)
Other Income and Deductions:
Equity in losses of partnerships (2 317) - (2 317)
Gain on retirement of fixed assets 36 - 36
Interest & dividend income 579 - 579
Interest Expense (50) (3 075) (3 125)
Total (1 752) (3 075) (4 827)
Income Before Income Taxes (4 621) (3 075) (7 696)
Income tax benefit (789) (1 076) (1 865)
Net Income (Loss) $ (3 832) $ (1 999) $ (5 831)
Accumulated Deficit:
Balance at Beginning of Period $ (10 389) $ - $(10 389)
Net Income (Loss) (3 832) (1 999) (5 831)
Balance at End of Period $ (14 221) $ (1 999) $(16 220)
The accompanying notes are an integral part of the financial statements.<PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 4 of 9
ENERGY INITIATIVES, INC. AND SUBSIDIARIES
PRO FORMA ADJUSTMENTS
AS AT SEPTEMBER 30, 1994
(IN THOUSANDS)
(1)
Investment in Partnerships $ 373
Notes Receivable 2 722
Intangible assets 2 600
Paid in capital $ 5,695
To reflect the proposed increase in GPU's capital contribution to EI for the
investment in Syracuse
(2)
Other investments $ 10 000
Paid in capital $ 10 000
To reflect the proposed increase in GPU's capital contributions to EI for
the investment in a limited partnership interest in Envirotech
Investment Fund I Limited Partnership. (SEC File order No. 70-8537)
(3)
Other investments $ 176 000
Paid in capital $ 176 000
To reflect the proposed increase in GPU's capital contribution to EI for
investment in QFs, EWGs and FUCOs. ($24 million to $200 million)
(SEC File No. 70-7727)
(4)
Cash and temporary investments $ 30 000
Notes payable $ 30 000
To reflect the proposed borrowings from commercial banks and financial
institutions which are to be guaranteed by GPU.
(SEC File No. 70-7727)
(5)
Interest expense $ 3 075
Interest payable $ 3 075
To reflect the incremental annual interest expense resulting from the
proposed $30 million of borrowings at 250 basis points above prime rate.
(SEC File No. 70-7727)
(6)
Tax accrued $ 1 076
Income tax expense $ 1 076
To reflect the decrease in the provision for federal income taxes at a rate of
35% attributable to the increase in interest expense from the proposed $30
million of borrowings which are guaranteed by GPU
(SEC File No. 70-7727)<PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 5 of 9
ENERGY INITIATIVES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
ORGANIZATION AND BUSINESS
Energy Initiatives, Inc. (EII), which commenced operations on April 1, 1985,
is a wholly-owned subsidiary of General Public Utilities Corporation (GPU).
EII owns 100% of the common stock of the following active corporations:
Elmwood Energy Corporation (EEC), Hanover Energy Corporation, Camchino Energy
Corporation (Camchino), Geddes Cogeneration Corporation (Geddes) and NCP
Energy, Incorporated (NCP Energy) formerly North Canadian Power, Incorporated
(NCP). In addition, it also owns 100% of Armstrong Energy Corporation, an
inactive corporation. Each of these subsidiaries was formed to develop,
either directly, or indirectly through limited partnerships, cogeneration or
small power production facilities which are qualifying facilities (QF's) under
the Public Utility Regulatory Policies Act of 1978 (PURPA). Under PURPA
regulations, EII and its subsidiaries may not own more than a 50% interest in
such facilities after commencement of operation.
In June 1990, the Securities and Exchange Commission (SEC) authorized GPU,
through General Portfolios Corporation (GPC), to contribute additional amounts
of up to $60 million to EII through December 31, 1992. In December 1992, the
SEC extended GPU's authority, through GPC, to contribute additional amounts up
to $60 million to EII through December 31, 1994. EII intends to utilize such
contributions for investment in proposed QF projects and Exempt Wholesale
Generators (EWG), as defined in the Energy Policy Act of 1992, expenditures
for preliminary project development costs, the purchase of ownership interests
in existing QF's and EWG's, and other corporate purposes.
EII also owns 100% of the stock of the following Canadian corporations: EII
Canada Holding Limited, EII Services Canada Limited, and EII Brooklyn Power
Limited. These corporations were formed to purchase ownerships and to provide
operations and management services to EWG's in Canada.
1. ACQUISITIONS, MERGERS AND INVESTMENTS
General Portfolios Corporation
In April, 1994, GPC, formerly a wholly-owned subsidiary of GPU and 100%
parent of EII, was merged with the Company. The principal assets recorded by
the Company for the merger consisted of investments in securities. As of
September 30, 1994, the securities have a market value of approximately $15.3
million.<PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 6 of 9
North Canadian Power, Incorporated
In June, 1994, the Company acquired 100% of the stock of NCP (subsequently
renamed NCP Energy), a California company engaged in the business of
developing, owning and managing cogeneration and other independent power
plants in the United States and Canada. NCP Energy owns 100% of the following
corporations: NCP Lake Power, Incorporated (NCP Lake), NCP Gem, Incorporated
(NCP Gem), NCP Dade Power, Incorporated (NCP Dade), NCP Pasco, Incorporated
(NCP Pasco), NCP Ada Power, Incorporated (NCP Ada), and NCP Power Commerce,
Incorporated (NCP Commerce).
Through the stock purchase, the Company acquired partnership interests on
four of the five cogeneration facilities associated with the sale (see Note
2), along with the tangible and intangible assets of NCP, for approximately
$54 million. The ultimate acquisition of the fifth and remaining partnership
interest is contingent upon obtaining the appropriate consents of the parties
affiliated with that project.
Onondaga Cogeneration Limited Partnership
In April 1989, Geddes acquired all of the general and limited partnership
interests of Onondaga Cogeneration Limited Partnership (Onondaga), a New York
partnership engaged in the development of an approximately 79 MW cogeneration
facility in Geddes, New York (Geddes Project). Geddes accounted for its
acquisition using the purchase method (Note 2).
At the acquisition date, Geddes paid $1.3 million and assumed liabilities of
the sellers estimated to be $750,000. In June 1992, at project financing,
Geddes paid an additional $3 million to the sellers pursuant to the Restated
Acquisition Agreement. Geddes may be required to pay additional amounts to
the sellers contingent upon the consummation of certain transactions as
specified in the Restated Acquisition Agreement.
Selkirk Option
In October 1992, the Company amended its option agreement dated June 28,
1991 to purchase interests in two cogeneration facilities located in
Bethlehem, New York; a 79.9 MW facility currently in operation and a 270 MW
facility that commenced commercial operation on September 1, 1994. The
Company paid $180,440 and $3,695,210 for the option in 1992 and 1991,
respectively. The Company also paid $1,154,000 and $1,083,784 of development
contributions for the 270 MW project in accordance with the cost sharing
agreement in 1992 and 1991, respectively.
In October 1992, at project financing of the 270 MW Project, the Company was
reimbursed $2,447,368 for its development contributions. The Company also
made an equity contribution of $1,181,093 to the Project, together with a
letter of credit backed by a cash deposit in the principal amount of $7.6
million to guarantee future equity contributions to the Project. In October
1993, the Company replaced the $7.6 million deposit with a guarantee by GPU.
On September 23, 1994, the Company made its $7.6 million equity investment in
the Project.<PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 7 of 9
The option agreement provides that the option be exercised prior to January
2, 1995 with an additional payment of $5.5 million plus accrued interest
subject to adjustment specified in the agreement. In the event the option is
not exercised by the Company, the agreement provides that the Project shall
repay all contributions made by the Company together with interest at 12% per
annum from the first distributions received by the partnership.
Polsky Energy Corporation
In September 1993, the Company entered into a stock purchase agreement with
Polsky Energy Corporation (PEC), a Delaware corporation engaged in the
development of independent power production, whereby the Company would
purchase common stock representing 4.9% of the voting shares and, in
aggregate, not more than 29% of the total number of shares of all classes of
stock for a total purchase price not to exceed $8.5 million. The Company also
has the right to provide the operations and maintenance services for several
PEC projects under development.
At the acquisition date, the Company paid $2.5 million, which represents
approximately a 12% interest in PEC, for the initial installment of the stock
purchase. The obligation for the remaining $6 million of the aggregate
purchase price is $2.5 million on July 1, 1994, $2 million on July 1, 1995,
and $1.5 million on July 1, 1996. In addition, the Company deposited $2.5
million in an escrow account to guarantee its 1994 obligation, as required by
the stock purchase agreement. On July 1, 1994, the Company paid its $2.5
million installment and secured its July 1, 1995 $2 million investment with a
letter of credit supported by a GPU guarantee. The Company has accounted for
this acquisition using the purchase method and as a result recorded the
payment of $2.5 million as goodwill that will be amortized over a period of 40
years. The Company accounts for its investment using the equity method. The
Company recorded Goodwill amortization on this investment in the amount of
$23,082, and equity losses in the amount of $15,274.
2. PARTNERSHIP INTERESTS
Lake Cogen Ltd.
Through NCP Lake and NCP Gem, NCP Energy has a 1% general partner interest
and a 41.2% limited partner interest in Lake Cogen Ltd. (Lake), a Florida
limited partnership. The Lake project is a 112 MW cogeneration facility
located on the site of Golden Gem, Inc. fruit processing operations. The
project has a 20-year Power Purchase Agreement (PPA) with Florida Power
Corporation (FPC), and a 20-year Cogeneration Services Agreement with Golden
Gem. The project was placed into commercial operation on July 1, 1993, and was
financed through a sale-leaseback with the Owner Trustee for an initial term
of 11 years. At September 30, 1994, NCP Energy had an investment in Lake of
approximately $8.5 million.<PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 8 of 9
Pasco Cogen Ltd.
Through NCP Dade and NCP Pasco, NCP Energy has a 1% general partner interest
and a 45.85% limited partner interest in Pasco Cogen Ltd. (Pasco), a Florida
joint venture partnership. The Pasco project is a 112 MW cogeneration facility
located on the site of Lykes Pasco, Inc. fruit processing operations. The
project has a 20-year PPA with FPC and a 20-year Steam Production Contract
with Lykes Pasco. The project was placed into commercial operation on July 1,
1993, which was funded with long-term debt of approximately $93 million. At
September 30, 1994, NCP Energy had an investment in Pasco of approximately $23
million.
Ada Cogeneration Limited Partnership
Through NCP Ada, NCP Energy has a 1% general partner interest in Ada
Cogeneration Limited Partnership (ADA), a Michigan limited partnership. The
Ada project is a 29 MW cogeneration facility located on the site of Amway
Corporation world headquarters. The project has a 35-year PPA with Consumers
Power Company and a 35-year Thermal Sales Agreement with Amway. The project
was placed into commercial operation on January 5, 1991, which was funded with
long-term debt of approximately $26 million. At September 30, 1994, NCP
Energy had an investment in Ada of approximately $4 million.
FPB Cogeneration Partners, L.P.
Through NCP Commerce, NCP Energy has a 30% co-general partner interest in
FPB Cogeneration Partners, L.P. (FPB), a 26 MW cogeneration facility located
in Commerce, California. Due to the uncertainty of future distributions of
cash flows, no consideration was paid for the partnership interests in FPB.
Consequently, there is no investment carrying amount as of September 30, 1994.
Prime Energy Limited Partnership
EEC has a 1% interest as the sole general partner and a 49% interest as
limited partner in Prime Energy Limited Partnership (PELP). PELP was
organized to construct, own and operate a 65 MW cogeneration project in
Elmwood Park, New Jersey (Marcal Project). The Marcal Project was placed in
commercial operation in July 1989 at a total capitalized cost of approximately
$61 million, which was funded with nonrecourse debt collateralized by PELP's
assets. PELP has a Power Purchase Agreement with an affiliate of EII for the
sale of electricity and capacity from the Marcal Project.
O.L.S. Power Limited Partnership
Through Camchino, EII owns a 1% interest as general partner and a 49%
interest as limited partner in O.L.S. Power Limited Partnership (O.L.S.
Power), a Delaware limited partnership. The remaining limited partnership
interests are owned by The Prudential Insurance Company of America. At
December 31, 1993 and 1992, Camchino had a total investment in O.L.S. Power of
zero and approximately $2.2 million, respectively. <PAGE>
Financial Statements
Exhibit 6(b) 1-A
Page 9 of 9
On August 3, 1989, O.L.S. Power acquired, through O.L.S. Acquisition
Corporation, all of the outstanding capital stock of O.L.S. Energy - Berkeley
(Berkeley), O.L.S. Energy - Chino (Chino) and O.L.S. Energy - Camarillo
(Camarillo) for a total purchase price of approximately $13.4 million.
Berkeley, Chino and Camarillo are each lessees, pursuant to separate sale and
leaseback agreements, of operating cogeneration facilities at the University
of California - Berkeley (22.5 MW), the California State Correctional Facility
in Chino (27 MW) and the State Hospital in Camarillo, California (27 MW),
respectively.
Onondaga Cogeneration Limited Partnership
In April 1989, Geddes acquired all of the general and limited partnership
interests of Onondaga Cogeneration Limited Partnership, a New York
partnership. In June 1992, Onondaga obtained project financing for the
construction of the Geddes Project. On the project financing date, Geddes
became the sole general partners and a limited partner in Onondaga. The
remaining limited partnership interests are owned by a non-affiliated party
who contributed $13.5 million in equity during 1992.
Construction of the project is being financed by a group of lenders through
the Onondaga County Industrial Development Authority (OCIDA). OCIDA has
provided for a construction loan of up to $89.5 million, which will, subject
to satisfaction of certain conditions, be converted to a term loan of up to
$82 million with a maturity of up to 15 years from the term loan conversion
date of the project. Geddes made its capital contribution of $13.5 million on
December 17, 1993. On December 18, 1993, the project commenced commercial
operations.
The Lenders have required Geddes to provide for up to $9 million of
additional funding, in the form of equity letters of credit, to provide for
cost overruns during the construction period and contingent obligations during
the term loan period. Geddes, through EII, has provided a letter of credit to
support other funding requirements in the amount of $9 million, which has been
guaranteed by GPU.
3. LEASE
In August 1992, EII entered into a lease for its corporate facilities with
GPU Nuclear Corporation (GPUN), a subsidiary of GPU. EII Paid GPUN $203,309
and $103,758 in 1993 and 1992, respectively, for rental payments and other
costs associated with the lease agreement.<PAGE>
Financial Statements
Item 6(b) 1-B
Page 1 of 4
NCP ENERGY, INCORPORATED
BALANCE SHEET
ACTUAL
AT SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments
(Unaudited) (See Page 4) Pro forma
ASSETS
Property and equipment $ 20 $ (20) $ -
Investment in partnership - 373 373
Investment in subsidiaries 35 922 (35 922) -
Total $ 35 922 $(35 549) $ 373
Current Assets:
Cash & temporary investments 7 (7) -
Accounts receivable 74 (74) -
Prepayments & deposits 14 (14) -
Total 95 (95) -
Non-current Assets:
Intangible assets - 2 600 2 600
Notes receivable - 2 722 2 722
Long term receivables from
partnerships 2 128 (2 128) -
Total 2 128 3 194 5 322
Total Assets $ 38 165 $(32 470) $ 5 695<PAGE>
Financial Statements
Item 6(b) 1-B
Page 2 of 4
NCP ENERGY, INCORPORATED
BALANCE SHEET
ACTUAL
AT SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments
(Unaudited) (See Page 4) Proforma
LIABILITIES AND STOCKHOLDERS EQUITY
Stockholders Equity
Paid in capital 37 912 (32 217) 5 695
Accumulated deficit (610) 538 (72)
Total 37 302 (31 679) 5 623
Current Liabilities:
Accounts payable 49 - 49
Taxes accrued 23 - 23
Total 72 - 72
Non-current Liabilities:
Advances due to parent 545 (545) -
Reserve for equipment disposal 246 (246) -
Total 791 (791) -
Total Liabilities and
Stockholders Equity $ 38 165 $(32 470) $ 5 695<PAGE>
Financial Statements
Item 6(b) 1-B
Page 3 of 4
NCP ENERGY, INCORPORATED
STATEMENTS OF OPERATIONS
ACTUAL
FOR THE PERIODS JUNE 13 - SEPTEMBER 30, 1994
(IN THOUSANDS)
Actual Adjustments
(Unaudited) (See Page 4) Pro forma
Operating Revenues $ 245 $ (245) $ -
Operating Expenses:
Operation and maintenance 140 (91) 49
Taxes other than income 10 (10) -
Total 150 (101) 49
Net Operating Income 95 (144) -
Other Income and Deductions:
Equity in losses of
subsidiaries (672) 672 -
Total (672) 672 -
Income Before Income Taxes (577) 528 (49)
Income tax expense 33 (10) 23
Net Income (Loss) $ (610) $ 538 $ (72)
Accumulated Deficit:
Balance at Beginning of Period $ - $ $ -
Net Income (Loss) (610) 538 (72)
Balance at End of Period $ (610) $ 538 $ (72)<PAGE>
Financial Statements
Item 6(b) 1-A
Page 4 of 4
NCP ENERGY INCORPORATED
PRO FORMA ADJUSTMENTS
AT SEPTEMBER 30, 1994
(IN THOUSANDS)
(1)
Reserve for equipment disposal $ 246
Paid in Capital 37,912
Operating revenue 245
Advances due parent 545
Property, plant & equipment, net $ 20
Investment in subsidiaries 35,922
Cash and temporary investments 7
Prepayments and deposits 14
Long term receivable from partnerships 2,128
Accounts receivable 74
O&M expense 140
Taxes & other income 91
Equity in subsidiary losses 672
Income tax expense 10
To reflect the proposed distribution of NCP Energy, Inc. assets to
Energy Initiatives, Inc.
(2)
Investment in Syracuse Orange Partners L.P. $ 373
Notes Receivable 2,722
Intangible assets (management agreement) 2,600
Paid in Capital $ 5,695
To reflect the proposed investment by NCP Energy, Inc. in a 4.9%
limited partnership interest in Syracuse Orange Partners L.P.,
acquisition of a note and consideration for the Syracuse Management
Agreement.<PAGE>
