SEC FILE NO. 70-7727
and
SEC FILE NO. 70-8593
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CERTIFICATE PURSUANT TO
RULE 24
OF PARTIAL COMPLETION OF
TRANSACTIONS
GPU, Inc.
GPU International, Inc.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
<PAGE>
- - - - - - - - - - - - - - - - - - - - - -
:
In the matter of :
GPU. INC. : Certificate Pursuant
GPU INTERNATIONAL, INC. : to Rule 24 of Partial
: Completion of
SEC File No. 70-7727 : Transactions
SEC File No. 70-8593 :
(Public Utility Holding Company Act :
of 1935) :
:
- - - - - - - - - - - - - - - - - - - - - -
TO THE MEMBERS OF THE SECURITIES AND EXCHANGE COMMISSION:
The undersigned, GPU, Inc. ("GPU") and GPU International, Inc. ("GPU
International") hereby certify pursuant to Rule 24 of the Rules and
Regulations under the Public Utility Holding Company Act of 1935 (the "Act"),
that certain of the transactions proposed in the Applications, as amended,
filed in SEC file No. 70-7727 and SEC File No. 70-8593, respectively, have
been carried out in accordance with the Commission's Orders dated November 16,
1995, June 14, 1995, December 28, 1994, September 12, 1994, December 18, 1992,
and June 26, 1990 with respect to the transactions proposed in the
Application, as amended, in SEC File No. 70-7727, and the Commission's Orders
dated, March 6, 1996, January 19, 1996 and July 6, 1995 with respect to the
transactions proposed in the Application, as amended, in SEC File No. 70-8593,
as follows:
The following is reported in accordance with Supplemental Order dated
November 16, 1995 for SEC File No. 70-7727:
2
<PAGE>
1. Financial Statements
A copy of GPU International's unaudited Consolidated Balance Sheet
as of March 31, 1997 and unaudited Consolidated Statement of Operations for
the three months ended March 31, 1997 will be filed separately under a request
for confidential treatment pursuant to Rule 104(b).
2. Business Activities
Project Development
A GPU subsidiary signed a partnership agreement with Magellan
Utilities Development Corporation (MUDC) agreeing to acquire up to a 40 percent
equity interest in a 300 megawatt coal-fired power plant to be built on the
south shore of Batangas Bay, Philippines. Power from the $350 million project
will be sold to Manila Electric Company. GPU's subsidiaries will be the
project's technical manager and the plant's operations and maintenance
contractor. Construction is targeted to begin in the first quarter of 1998
followed by a three year construction period.
GPU International also continued to engage in other project
development activities both domestically and internationally (including in
Europe, Asia, Africa, and South America).
Project Related Services
GPU International continued to provide management, administrative
and/or operating services to the following projects (either directly or
through subsidiaries), in which GPU International has a direct or indirect
ownership interest:
3
<PAGE>
Project Project Owner Location
Marcal Prime Energy L.P. NJ
Berkeley OLS Acquisition Corp. CA*
Chino OLS Acquisition Corp. CA
Camarillo OLS Acquisition Corp. CA
Onondaga Onondaga Cogeneration L.P. NY
Lake Lake Cogen L.P. FL
Pasco Pasco Cogen L.P. FL
Syracuse Project Orange Associates L.P. NY
Brooklyn Brooklyn Energy L.P. Canada
Mid-Georgia Mid-Georgia Cogen, L.P. GA
* GPU International's interest in this project was assigned in January 1997.
3. Guarantees which GPU has Agreed to Grant
No matters to be reported.
4. Guarantees Issued
GPU International or GPU, for the benefit of GPU International, has
obtained the following standby letters of credit which were effective during
the period January 1, 1997 through March 31, 1997:
(a) On February 26, 1996, a letter of credit in the face amount of $30,000
was issued by Citibank pursuant to its credit agreement with GPU International
("Citibank Credit Agreement") to support a bid for a 500 MW coal-fired
generating plant in Punjab State, India. The letter of credit carries a fee
equal to 0.5 of 1 percent per annum of the face amount, plus a .10 percent
fronting fee, and expires on May 26, 1997.
4
<PAGE>
(b) On December 8, 1996, a letter of credit in the face amount of
$1,788,850, issued on December 8, 1995 and scheduled to expire on December 8,
1996, was extended to December 8, 1997. The letter of credit was issued by
Citibank pursuant to the Citibank Credit Agreement in favor of Wisconsin
Public Service Company to support Polsky Energy Corp's (PEC) commitment to
construct a 236 MW cogeneration facility pursuant to its Power Sales Agreement
with Wisconsin Public Service Company. The letter of credit carries a fee
equal to 0.5 of 1 percent per annum of the face amount, plus a .10 percent
fronting fee.
(c) On June 16, 1994, a letter of credit in the face amount of $5 million
was issued by Chase Manhattan Bank in favor of Mellon Bank to support debt
service coverage on the Onondaga Project. The letter of credit carries a fee
equal to 0.7 of 1 percent per annum of the face amount, and expires on June
16, 1997. GPU entered into the related reimbursement agreement.
(d) During January 1997, a letter of credit in the face amount of
U.S. $9.7 million issued on March 11, 1994 and scheduled to expire on
June 11, 1997 was cancelled. Simultaneously, a $9.5 million investment was
made in Brooklyn Energy Limited Partnership ("BELP"), an exempt wholesale
generator ("EWG"). The letter of credit was issued by Canadian Imperial Bank
of Commerce, in favor of The Mutual Life Assurance Company of Canada to
support GPU International's equity commitment to BELP. The letter of credit
carried a fee equal to 0.625 of 1 percent per annum of the face amount. GPU
entered into the related reimbursement agreement.
In addition, the following guarantees were outstanding during the
period January 1, 1997 through March 31, 1997:
5
<PAGE>
(a) As of October 18, 1995, a guarantee of amounts up to $122,750,000 was
made by GPU for the benefit of the Bankers Trust Company as collateral agent
on behalf of the Equity Bridge Lenders and the Secured Parties in connection
with the Termobarranquilla project in Colombia.
(b) GPU International has guaranteed the obligations of GPU Power, Inc.
("GPU Power"), GPUI Colombia Ltda (formerly GPU International Latin America,
Ltda.), and International Power Advisors, Inc. (the Operators), under the
operations and maintenance agreement in the Colombia project. Pursuant to the
guarantee, GPU International has guaranteed the performance of the Operators,
of which the limit of liability is $5 million.
(c) GPU has guaranteed payments to General Electric Capital Corporation of
amounts up to the lesser of six months average rent (approximately $7,026,000)
or $10 million, to the extent Lake Cogen, Ltd. fails to pay rent when due
under the terms of the project lease or chooses not to renew the lease after
its initial 11-year term. In addition, GPU has guaranteed to pay any
documentary stamp taxes and intangible personal property taxes should these
taxes become due and payable in connection with the lease.
(d) GPU International has guaranteed the obligations of its wholly owned
subsidiary, EI Fuels Corporation ("EI Fuels"), under the Natural Gas
Facilities Agreement ("Facilities Agreement"), dated as of November 30, 1995.
Pursuant to the guarantee, GPU International has guaranteed the payments of EI
Fuels to the City of Warner Robins (the "City") for (a) Fixed Monthly Lease
Charge (as defined in the Facilities Agreement) and (b) any and all
extensions, renewals, modifications, amendments or substitutions of the
foregoing. The Fixed Monthly Lease Charge is $24,000, payable commencing on
6
<PAGE>
the in service date, subject to reduction in certain circumstances, for a term
of 31 years.
(e) GPU has guaranteed up to $32 million for the purpose of funding, on an
interim basis, the equity investment in Mid-Georgia Cogen L.P., which will be
used to finance the construction of the facility. GPU has also guaranteed up
to an additional $9 million in letter of credit obligations on behalf of Mid-
Georgia.
(f) As a condition of approval of the Florida Power Corporation ( FPC )
settlement by the primary lenders of the Pasco project, GPU International has
guaranteed payments to FPC of amounts up to $1.8 million in the event that a
refund to FPC is required.
5. Services obtained from associated companies
Services obtained from GPU Service, Inc. consisted of (i)
administrative, internal auditing, accounting and risk management services;
(ii) information services and telecommunications services, and (iii) pension
administration services. The total dollar value of such services provided
during the period January 1, 1997 through March 31, 1997 was $209,831.
6. Services provided to associated companies
A description of services provided by GPU International to
associate companies during the period January 1, 1997 through March 31, 1997
will be filed separately under a request for confidential treatment under Rule
104(b).
7. Investments by GPU in Qualifying Facilities, Exempt Wholesale
Generators and Foreign Utility Companies, Percentage of Equity Ownership
Set forth below is a summary of the direct or indirect investments
by GPU, as of March 31, 1997 in qualifying facilities (QFs), EWGs and foreign
utility companies (FUCOs), as well as the percentage of equity ownership.
7
<PAGE>
Book Value
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equity
Associate or at 3/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
Prime Energy, LP QF $ 5,533 50% Prudential Insurance Domestic
Company of America
OLS Power, LP QF - 1% Prudential Insurance Domestic
Company of America
Onondaga QF 16,985 50% NationsCredit Commercial Domestic
Cogen, LP Corporation
Lake Cogen, Ltd QF 2,852 49.9% Lake Interest Holding, Domestic
Inc.
Project Orange QF 1,928 4% G.A.S. Orange Partners,LP Domestic
Associates, LP NCP Syracuse Inc. "
Syracuse Investment Inc. "
Stewart & Stevenson "
Operations, Inc.
Met Life Capital Corporation "
Mid-Georgia EWG & (145) 100% Not Applicable Domestic
Cogen, LP QF
NCP Houston EWG 838* 100% Not Applicable N/A
Power Incorporated
Pasco Cogen, QF 16,261 49.9% PAS Power Company Domestic
Ltd. Pasco Int. Holding, Inc. "
FPB Cogenera- QF - 30% FPB Cogen, Inc. Domestic
tion Partners, FPB California "
LP (1) Cogeneration Corp.
Selkirk Cogen EWG & 15,216 19% JMC Selkirk, Inc. Domestic
Partners, LP QF Cogen Technologies "
Selkirk GP, Inc.
Cogen Technologies "
Selkirk, LP
JMCS I Investors, LP "
8
<PAGE>
Empresa EWG 48,050 50% Cititrust (Bahamas) Foreign
Guaracachi S.A. Limited
Guaracachi EWG 34,523* 100% Not Applicable N/A
America, Inc.
GPU Power, Inc. EWG 32,974* 100% Not Applicable N/A
Book Value
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equity
Associate or at 3/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
EI International EWG $ (34) 100% Not Applicable N/A
GPU International EWG (49)* 100% Not Applicable N/A
Colombia, Ltda
Solaris Power FUCO 119,270 50% Australian Gas Light, Foreign
Co.
Victoria Electric FUCO 124,554* 100% Not Applicable N/A
Inc.
Midlands FUCO 606,345 50% Cinergy Corp. Domestic
Electricity plc
Termobarranquilla EWG (1,076) 28.545% ABB Energy Ventures, Foreign
S.A. Inc.
Lancaster Distral Group "
Corporacion Electrica "
De la Costa Atlantica
EI Barranquilla, EWG (710)* 100% Not Applicable N/A
Inc.
Barranquilla EWG 59 100% Not Applicable N/A
Lease Holdings, Inc.
Los Amigos Leas- EWG (215)* 100% Not Applicable N/A
ing Company, Ltd.
EI Services EWG (149) 100% Not Applicable N/A
Canada, Ltd.
EI Canada EWG 7,898* 100% Not Applicable N/A
Holding, Ltd.
EI Brooklyn EWG 8,035* 100% Not Applicable N/A
Investment, Ltd.
EI Brooklyn EWG 7,898* 100% Not Applicable N/A
Power, Ltd.
9
<PAGE>
Book Value
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equity
Associate or at 3/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
Brooklyn Energy, EWG $ 7,802 75% Polsky Energy Corp. Foreign
LP of Brooklyn
_______ Brooklyn CoGen Limited Foreign
GPU's Aggregate
Investment* $838,897
(*) GPU's aggregate investment does not include the items shown with
asterisks in order to avoid duplication.
(1) GPU International sold its 30 percent general partnership interest
in FPB Cogeneration Partners, LP in April 1997.
As of March 31, 1997, GPU also owned, directly or indirectly,
interests in the following EWGs, in which its aggregate investment did not
exceed $10,000: GPU Power Philippines, Inc.; GPU International Asia, Inc.;
International Power Advisors, Inc.; Austin Cogeneration Corporation; Austin
Cogeneration Partners, L.P.; Hanover Energy Corporation; EI Power (China),
Inc.; China Power Partners, L.P.; EI Power (China)I, Inc.; Ming Jiang Power
Partners, L.P.; EI Power (China)II, Inc.; Nanjing Power Partners, L.P.; EI
Power (China) III, Inc.; and Zhuang He Power Partners, L.P. Of those listed,
GPU owns a 50% interest in China Power Partners, L.P., Ming Jiang Power
Partners, L.P., Nanjing Power Partners, L.P., and Zhuang He Power Partners,
L.P; the remaining interests of such EWG s are owned by Intesol International,
Ltd., a Hawaii corporation. GPU owns a 100% interest in each of the other
EWGs.
10
<PAGE>
8. During the period January 1, 1997 through March 31, 1997 there was no
intellectual property provided to GPU International by any associate company,
or provided by GPU International to any associate company.
_______________________________________
In accordance with Orders dated July 6, 1995 and March 6, 1996 in SEC File
No. 70-8593, and in addition to the reimbursement agreements described in
items 4 above, the following is reported:
1. Financial Statements
A copy of GPU Electric, Inc.'s ("GPU Electric") unaudited Consolidated
Balance Sheet as of March 31, 1997 and unaudited Consolidated Statement of
Operations for the three months ended March 31, 1997 will be filed separately
under a request for confidential treatment pursuant to Rule 104(b). GPU's
other Subsidiary Companies (EI UK Holdings, Inc., GPU International Australia
Pty Ltd, Avon Energy Partners Holdings, Avon Energy Partners Plc, and Victoria
Electric Holdings, Inc.) are direct or indirect subsidiaries of GPU Electric
and, accordingly, financial statements of such companies are not separately
presented.
2. Investments in Exempt Entities
In connection with the acquisition of Midlands Electricity plc
("Midlands") discussed in Item 3 below, EI UK Holdings, Inc. ("EI UK") entered
into a term loan agreement (the "Term Loan") dated as of May 6, 1996, with a
syndicate of banks, the Chase Manhattan Bank, N.A., as administrative agent,
Citibank, N.A., as syndication agent, Citicorp Securities, Inc. and Chase
Securities Inc., as arrangers. The Term Loan provides, among other things,
for EI UK borrowings from time to time of up to pounds sterling 350 million,
or approximately U.S. $574 million, through a GPU guaranteed five-year bank
term loan facility terminating on May 6, 2001.
The borrowing interest rate is based on the LIBOR plus an applicable margin
11
<PAGE>
as defined in the Term Loan corresponding to the debt ratings of GPU. As of
March 31, 1997, EI UK had aggregate borrowings of pounds sterling 347 million,
or approximately U.S. $568.9 million, outstanding under the Term Loan. EI UK
invested such funds in Midlands through Avon Energy Partners Holdings
( Holdings ). The borrowings bear interest at 6.7125 percent per annum, which
was based on the LIBOR at December 9, 1996, plus a .525 percent margin.
On November 22, 1995, GPU acquired all of the capital stock of GPU
Electric and made capital contributions of $48 million. The capital
contributions were used by GPU Electric to acquire Solaris Power ("Solaris")
(through Victoria Electric, Inc.). During August 1996, Victoria Electric
Holdings, Inc., a wholly owned subsidiary of GPU Electric, was established to
hold the investment in Victoria Electric, Inc.
On November 20, 1995, GPU Electric entered into a credit agreement,
dated as of November 20, 1995, (the "Credit Agreement"), with Citibank Limited
as the Participant and Arranger, for which Citisecurities Limited is the
Agent. The Credit Agreement provides, among other things, for revolving credit
borrowings by GPU Electric from time to time through November 20, 1998,
subject to extensions for two years at the sole discretion of the Participant,
in amounts not to exceed an aggregate of Australian $95 million outstanding at
any one time. In August 1996, the Credit Agreement was transferred to Victoria
Electric Holdings, Inc. Borrowings are guaranteed by GPU. The proceeds of
such borrowings were used to fund, in part, GPU s investment in Solaris.
Notes issued under the Credit Agreement bear interest at the Bill
Discount Rate which is equal to the mean "bid rate" quoted on the page
entitled "BBSY" on the Reuters Monitor System at or about 10:00am (Sydney
12
<PAGE>
time) on the Funding Date. As of March 31, 1997, the remaining outstanding
balance of the borrowing amounted to Australian $82.1 million, or
approximately U.S. $64.5 million.
Other investments in exempt entities are described in items 2 and 4
above under 70-7727.
3. Description of Exempt Entities in Which There are Funds Invested
Selkirk Cogen Partners, L.P. (Selkirk)
Selkirk owns and operates two natural gas-fired combined-cycle
cogeneration facilities located in Bethlehem, New York. The facilities are
79.9 and 265 megawatts (MW) each with a combined average net capacity of 344.9
MW producing steam and electricity.
Brooklyn Energy, L.P. (Brooklyn)
GPU International has contributed U.S. $9.5 million, in equity and
has agreed to contribute an additional Canadian $1 million, or approximately
U.S. $0.7 million, in subordinated debt to Brooklyn, which owns a 24 MW wood
and oil-fired cogeneration facility located in Brooklyn, Nova Scotia, Canada.
Commercial operation of the facility commenced in April 1996.
Empresa Guaracachi, S.A.
In July 1995, GPU Power, through Guaracachi America, Inc., acquired
from the Bolivian Government a 50% interest in Empresa Guaracachi, S.A., an
electric generating company having an aggregate capacity of 216 MW of natural
gas-fired and oil-fired generation for approximately $47 million. The
facilities are located in Bolivia in and around the cities of Santa Cruz,
13
<PAGE>
Sucre and Potosi with their total capacity representing one-third of Bolivia's
generation capacity. GPU Power's investment of $47 million will be used by
the year 2002 to expand the generating facilities to meet Bolivia's growing
demand.
Solaris Power ("Solaris")
In November 1995, GPU Electric, through Victoria Electric, Inc.,
together with the Australian Gas Light Company, acquired Solaris for a total
purchase price of approximately $712 million, of which GPU Electric's 50%
share is $356 million. GPU Electric has made an equity investment in Solaris
of approximately $112 million; the balance of the purchase price was provided
through non-recourse borrowings by Solaris from an Australian bank syndicate.
Solaris, which provides electric service to more than 240,000 customers in and
around Melbourne, Australia, was sold by the government of Victoria through a
competitive bid as part of that state's privatization of the electric
industry.
Termobarranquilla, S.A.
In October 1995, GPU Power, through EI Barranquilla, Inc., completed
the financing for and acquired a 28.545% interest in Termobarranquilla, S.A.,
Empresa de Servicios Publicos ("TEBSA"), a 240 MW gas-fired generating plant
in Barranquilla, Colombia and began the construction of a new 750 MW gas-fired
plant adjacent to the existing plant (the "Barranquilla Project").
Electricity generated by these plants will be sold to Corporacion Electrica de
la Costa Atlantica under a 20-year contract. Total project costs, including
the acquisition of the existing plant, are approximately $750 million, of
which GPU Power's equity contribution is expected to be approximately $65
million.
14
<PAGE>
Barranquilla Lease Holdings, Inc. and Los Amigos Leasing Company, Ltd.
Barranquilla Lease Holdings, Inc., a subsidiary of GPU Power, through
its wholly-owned subsidiary Los Amigos Leasing Company, Ltd. ("Leaseco"),
procures equipment to be used by and leased to TEBSA. Pursuant to a
lease agreement, Leaseco will deliver certain non-Colombian equipment related
to TEBSA, and TEBSA will make lease payments equal to the interest and
principal payments on senior bank debt and certain other expenses incurred by
Leaseco.
Midlands Electricity plc
In May, 1996, GPU and Cinergy Corporation ("Cinergy") formed Avon
Energy Partners plc ("Avon"), a wholly-owned subsidiary of Holdings. Holdings
is a 50/50 joint venture which acquired Midlands, an English regional electric
company ("REC"). GPU's 50 percent interest in Holdings is held by EI UK, a
wholly-owned subsidiary of GPU Electric.
EI UK and Cinergy have each invested approximately $585.7 million in
Holdings. EI UK has borrowed approximately $585.7 million through a GPU
guaranteed five-year bank term loan facility to fund its investment in
Holdings. Holdings has borrowed approximately $1.6 billion through a non-
recourse term loan and revolving credit facility to provide for the balance of
the acquisition price.
Midlands, one of 12 RECs in the United Kingdom, distributes and
supplies electricity to 2.2 million customers in England in an area with a
population of five million. Midlands also owns a generation business that
produces electricity domestically and internationally and a gas supply company
that provides natural gas service to 8,000 customers in England.
15
<PAGE>
4. Services Obtained From Associated Companies
GPU Energy provided consulting services to GPU International Australia
in the amount of $95,303, for the three months ended March 31, 1997, in
support of the development and management of Solaris' operations.
GPU Service, Inc. provided consulting services to GPU Power in the
amount of $74,372 related to the oversight and management of GPU Power's
operations.
GPU Service, Inc. provided consulting services to GPU Electric in the
amount of $25,982 related to the oversight and management of GPU Electric's
operations.
5. Services Provided to Associated Companies
A description of services provided by GPU Electric to associate
companies during the period January 1, 1997 through March 31, 1997 will be
filed separately under a request for confidential treatment under Rule 104(b).
16
<PAGE>
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY HOLDING COMPANY ACT
OF 1935, THE UNDERSIGNED COMPANIES HAVE DULY CAUSED THIS CERTIFICATE TO BE
SIGNED ON THEIR BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
GPU, Inc.
By:
T. G. Howson,
Vice President and Treasurer
GPU International, Inc.
By:
B. L. Levy, President
Date: June 2, 1997
<PAGE>
