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
<PAGE>
GPU, Inc.
GPU International, Inc.
- - - - - - - - - - - - - - - - - - - - - -
:
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 Ac :
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, November 5, 1997, 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:
2
<PAGE>
The following is reported in accordance with Supplemental Order dated
November 16, 1995 for SEC File No. 70-7727:
1. Financial Statements
--------------------
A copy of GPU International's audited Consolidated Balance Sheet as of
December 31, 1997 and 1996 and audited Consolidated Statement of Operations for
the years ended December 31, 1997 and 1996 will be filed separately under a
request for confidential treatment pursuant to Rule 104(b).
2. Business Activities
-------------------
Project Development
- -------------------
GPU International continued to engage in 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 as of December 31, 1997 to the following projects
(either directly or through subsidiaries), in which GPU International has a
direct or indirect ownership interest:
Project Project Owner Location
------- ------------- --------
Marcal Prime Energy L.P. NJ
Chino OLS Acquisition Corp. CA
Camarillo OLS Acquisition Corp. CA
3
<PAGE>
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. Canada
Mid-Georgia Mid-Georgia Cogen, L.P. GA
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 October 1, 1997 through December 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. The letter of credit is scheduled to expire on June 30, 1998.
(b) 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
4
<PAGE>
0.7 of 1 percent per annum of the face amount, and is scheduled to expire on
June 15, 1998. GPU entered into the related reimbursement agreement.
In addition, the following guarantees were outstanding during the
period October 1, 1997 through December 31, 1997:
(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 (TEBSA) project in Colombia.
(b) GPU International has guaranteed the obligations of GPUI Colombia Ltda., and
International Power Advisors, Inc. (the Operators), each of which are
subsidiaries ofg GPU Power, Inc. (GPU Power), under the operations and
maintenance agreement (O&M Agreement) in the TEBSA project. The liability of the
Operators under the O&M Agreement is limited to $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
5
<PAGE>
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 the in service date, subject to
reduction in certain circumstances, for a term of 31 years (approximately
$8,928,000).
(e) GPU has guaranteed (I) $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 and (ii) $7 million for a construction
completion guarantee. GPU has also guaranteed up to an additional $9 million in
letter of credit obligations on behalf of Mid-Georgia, which will become
effective upon commercial operation expected by mid-1998.
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 October 1, 1997 through December 31, 1997 was $304,429.
6
<PAGE>
6. Services provided to associated companies
-----------------------------------------
A description of services provided by GPU International to associate
companies during the period October 1, 1997 through December 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, and Percentage of Equity
----------------------------------------------------------------------
Ownership
--------
Set forth below is a summary of the direct or indirect
investments by GPU, as of December 31, 1997 in qualifying facilities
(QFs), EWGs and foreign utility companies (FUCOs), as well as the
percentage of equity ownership.
7
<PAGE>
<TABLE>
Book Value
<CAPTION>
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equity ------------------------------
Associate or at 12/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Prime Energy, LP QF $ 7,410 50% Prudential Insurance Domestic
Company of America
OLS Power, LP QF - 1% Prudential Insurance Domestic
Company of America
Onondaga QF 13,513 50% NationsCredit Commercial Domestic
Cogen, LP Corporation
Lake Cogen, Ltd QF 16,338 49.9% Lake Interest Holdings, Domestic
Inc.
New Lake Corporation "
Project Orange QF 1,886 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 & (280)* 100% Not Applicable Domestic
Cogen, LP QF
NCP Houston EWG 810* Not Applicable N/A
Power Incorporated
Pasco Cogen, QF 16,199 49.9% DCC Project Finance Ten Domestic
Ltd. Inc.
PAS Power Company "
Pasco Int. Holding, Inc. "
Pasco Project Investment "
Partnership LP
Selkirk Cogen EWG & 12,105 19% JMC Selkirk, Inc.
Domestic QF Cogen Technologies "
Partners, LP Selkirk GP, Inc.
Cogen Technologies "
Selkirk, LP
JMCS I Investors, LP "
Empresa EWG 49,101 50% Cititrust (Bahamas) Foreign
Guaracachi S.A. Limited
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Book Value
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equity ------------------------------
Associate or at 12/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Guaracachi EWG $34,653* 100% Not Applicable N/A
America, Inc.
GPU Power, Inc. EWG 31,269* 100% Not Applicable N/A
EI International EWG 222* 100% Not Applicable N/A
GPU International EWG 179* 100% Not Applicable N/A
Colombia, Ltda
Solaris Power FUCO 106,317 50% Australian Gas Light, Foreign
Co.
Victoria Electric FUCO 114,911* 100% Not Applicable N/A
Inc.
Midlands FUCO 517,209 50% Cinergy Corp. Domestic
Electricity plc
GPU PowerNet FUCO 1,700,619 100% Not Applicable N/A
Pty. Ltd.
GPU Australia FUCO 42,432* 100% Not Applicable N/A
Holdings, Inc.
Austran Holdings FUCO 226,836* 100% Not Applicable N/A
Inc.
Termobarranquilla EWG (2,510) 29% ABB Energy Ventures, Foreign
S.A. Inc.
Lancaster Distral Group "
Corporacion Electrica "
De la Costa Atlantica
EI Barranquilla, EWG (2,011)* 100% Not Applicable N/A
Inc.
Barranquilla EWG 59* 100% Not Applicable N/A
Lease Holdings, Inc.
Los Amigos Leas- EWG 12 100% Not Applicable N/A
ing Company, Ltd.
EI Services EWG (24)* 100% Not Applicable N/A
Canada, Ltd.
</TABLE>
9
<PAGE>
Book Value
FUCO, of GPU GPU's% Owners not affiliated with GPU
QF Investment Equi ------------------------------
Associate or at 12/31/97 Owner- Type of
Company EWG ($000) ship Name of Entity Entity
- -------------------------------------------------------------------------------
EI Canada EWG 20* 100% Not Applicable N/A
Holding, Ltd.
EI Brooklyn EWG -- 100% Not Applicable N/A
Investment, Ltd.
EI Brooklyn EWG 20* 100% Not Applicable N/A
Power, Ltd.
Brooklyn Energy, EWG -- 75% Polsky Energy Corp. Foreign
LP of Brooklyn
_______ Brooklyn CoGen Limited Foreign
GPU's Aggregate
Investment* $2,438,199
==========
(*) GPU's aggregate investment does not include the items shown with asterisks
in order to avoid duplication.
As of December 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
10
<PAGE>
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.
8. During the period October 1, 1997 through December 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") and GPU Power, Inc.'s
(GPU Power) audited Consolidated Balance Sheets as of December 31, 1997 and 1996
and audited Consolidated Statement of Operations for the years ended December
31, 1997 and 1996 will be filed separately under a request for confidential
treatment pursuant to Rule 104(b).
2. Investments in Exempt Entities
------------------------------
On November 6, 1997, GPU Electric acquired the business of PowerNet
Victoria (PowerNet), which is currently known as GPU PowerNet, from the State of
Victoria, Australia for A$2.6 billion (approximately U.S. $1.9 billion).
11
<PAGE>
The PowerNet acquisition was financed through: (1) a senior debt facility of
A$1.9 billion (approximately U.S. $1.4 billion), which is non-recourse to GPU,
Inc.; (2) a five year U.S. $450 million bank credit agreement which is
guaranteed by GPU, Inc.; and (3) an equity contribution of U.S. $50 million
from GPU,Inc.
GPU Electric (through its investment in Austran Holdings) entered into
the A$1.9 billion facility agreement (Facility Agreement) with Chase Securities
Australia Limited, Dresdner Australia Limited, and J.P. Morgan Australia
Securities Limited. The Facility Agreement is guaranteed by GPU PowerNet and
provides for interest at the Australian dollar bill discount rate as specified
in the Facility Agreement. The terms of the Facility Agreement are as follows:
As of 12/31/97
Amount Term Interest Rate
------ ---- -------------
Tranche A A$481.250 million 364 days 5.51%
Tranche B A$721.875 million 3 years 5.59%
Tranche C A$721.875 million 5 years 5.71%
As of December 31, 1997, GPU Electric has outstanding borrowings of
A$1.9 billion (approximately U.S. $1.3 billion) under the Facility Agreement.
GPU Electric (through its investment in Australia Holdings) entered
into the $450 million bank credit agreement (Credit Agreement) with Chase
Manhattan Bank, as agent for a lending institution consortium. The Credit
Agreement provides for incremental borrowings consisting of several
12
<PAGE>
competitive advances from participating banks or simultaneous advances of the
same type (Adjusted Base Rate Advance or Eurodollar Rate Advance) at the
company's discretion.
Interest for the Adjusted Base Rate Advance is calculated at the
higher of Chase Manhattan's base rate or the Federal Funds rate plus 1/2
percent, payable quarterly. Interest for the Eurodollar Rate Advances is
calculated at the London Interbank Offering Rate (LIBOR) plus an applicable
margin ranging from 0.20% to 1.25%, payable on the last day of the interest
period.
Borrowings under the Credit Agreement are repayable annually on each
anniversary of the acquisition in increments of $90 million with the final
payment due in November 2002. As of December 31, 1997, GPU Electric has $450
million of outstanding borrowings under the Credit Agreement with interest
calculated at 6.2% per annum.
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 340 million, or
approximately U.S. $561.2 million, through a GPU guaranteed five-year bank term
loan facility terminating on May 6, 2001.
13
<PAGE>
The borrowing interest rate is based on the LIBOR plus an applicable
margin as defined in the Term Loan corresponding to the debt ratings of GPU. As
of December 31, 1997, EI UK had aggregate borrowings of pounds sterling 340
million, or approximately U.S. $561.2 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
(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.
14
<PAGE>
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 time) on the Funding
Date. As of December 31, 1997, the remaining outstanding balance of the
borrowing amounted to Australian $79.9 million, or approximately U.S. $52
million.
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: a 79.9 megawatt (MW)
facility and a 270 MW facility.
Brooklyn Energy, L.P. (Brooklyn)
- --------------------------------
Brooklyn 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. Since April 1996, when Brooklyn entered into commercial operation,
the project has experienced operating cash deficits primarily due to a reduction
in the electric energy rate and suboptimal equipment performance. These deficits
were partially funded by advances from both GPU International and its subsidiary
EI Services Canada Limited, the project operator. As a result of these operating
cash deficits, Brooklyn has been unable to make (i) principal payments under the
terms of its nonrecourse credit obligation and (ii) full payment to, among other
providers, EI Services Canada Limited for operating and maintenance services.
15
<PAGE>
During 1997, Brooklyn received several default notices from
its Lenders for failure to pay principal and interest as required under the
Credit Agreement. Under the terms of the Credit Agreement, if an Event of
Default has occurred and is continuing the Lenders have the right to enforce
certain remedies which include but are not limited to acceleration of the entire
principal amount of the Loan.
As of December 31, 1997, GPU International has made capital
contributions in Brooklin totaling Canadian $12.9 million (approximately U.S. $9
million) and has provided Canadian $4.2 million (approximately U.S. $3 million)
of funding to EI Services Canada Limited and Brooklyn to pay past due operating
expenses. In 1997, GPU International recorded a provision of U.S. $7.9 million
to fully reserve its investment balance and advances due to both GPU
International and EI Services Canada Limited.
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, 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.
16
<PAGE>
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.
GPU Electric is required to sell its interest in Solaris due to cross-ownership
restrictions imposed when it acquired PowerNet.
Termobarranquilla, S.A.
- -----------------------
In October 1995, GPU Power, through EI Barranquilla, Inc., completed
the financing for and acquired a 29% interest in Termobarranquilla, S.A.,
Empresa de Servicios Publicos ("TEBSA"), an existing 180 MW gas-fired generating
plant in Barranquilla, Colombia and TEBSA began the construction of a new 780 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 expected to be $756.2 million, of which
GPU Power's equity contribution is expected to be approximately $65 million.
17
<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 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. GPU's 50
percent interest in Holdings is held by EI UK, a wholly-owned subsidiary of GPU
Electric.
EI UK invested approximately $585.7 million in Holdings by borrowing
such proceeds through a GPU guaranteed five-year bank term loan facility.
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, distributes and supplies electricity to 2.3 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
18
<PAGE>
in England. In addition, Midlands owns and has under development a number of
international generation projects.
PowerNet
- --------
PowerNet owns and operates the existing high-voltage electricity
transmission system in the State of Victoria, Australia. The PowerNet
transmission system serves all of Victoria covering an area of approximately
87,900 square miles and a population of approximately 4.5 million.
4. Services Obtained From Associated Companies
-------------------------------------------
GPU Energy provided administrative services to GPU International
Australia in the amount of $97,150, for the three months ended December 31,
1997,in support of the development and management of Solaris' operations.
GPU Service, Inc. provided administrative services to GPU Power in
the amount of $3,685 for the three months ended December 31, 1997, related to
the oversight and management of GPU Power's operations.
GPU Service, Inc. provided administrative services to GPU Electric
in the amount of $117,236 for the three months ended December 31, 1997, 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 and GPU Power to
associate companies during the period October 1, 1997 through December 31, 1997
will be filed separately under a request for confidential treatment under Rule
104(b)
19
<PAGE>
In Accordance with the Commission's Order dated November 5, 1997 in SEC
File No. 70-8593, the following is reported:
a) GPU, Inc.'s aggregate investment includes all amounts invested, or
committed to be invested, in foreign utility companies (FUCOs) and exempt
wholesale generators (EWGs), for which there is recourse, directly or
indirectly, to the registered holding company. GPU Inc.'s aggregate investment
as of December 31, 1997 is as follows:
(In Thousands)
--------------
FUCOs
- -----
Solaris Power 117,417
Midlands Electricity plc 564,516
GPU PowerNet 500,000
---------
Subtotal 1,181,933
---------
EWGs
- ----
Mid-Georgia Cogen, L.P. 39,000
Selkirk Cogen, L.P. 12,104
Brooklyn Energy, L.P. 10,510
Termobarranquilla, S.A. 122,750
Empresa Guaracachi, S.A. 48,645
Development projects 2,291
---------
Subtotal 235,300
---------
Aggregate Investment in FUCOs and EWGs $ 1,417,233
=========
b) As of December 31, 1997
(In Thousands)
20
<PAGE>
GPU, Inc.'s Aggregate Investment in FUCOs and EWGs $ 1,417,233
Aggregate Investment as a Percentage of GPU, Inc. and Subsidiary Companies:
Total capitalization $ 8,899,028 15.9%
Net utility plant $ 7,509,571 18.9%
Total consolidated assets $ 12,924,708 11.0%
Market value of common equ $ 5,090,074 27.8%
c) GPU, Inc. and Subsidiary Companies
Consolidated Capitalization Ratios as of December 31, 1997
(In Thousands)
Amount %
Common equity $ 3,099,930 34.8
Cumulative preferred stock 170 1.9
Subsidiary-obligated mandatoril
redeemable preferred securities 330,000 3.7
Long-term debt 4,945,406 55.6
Notes payable 353, 4.0
--------- ----
Total capitalization $ 8,899,028 100.0%
========= ======
d) Market-to-book ratio of GPU, Inc. and Subsidiary Companies common
stock at December 31, 1997
Closing Market Price per Share $ 42.1250
Book Value per Share $ 25.59
Market-to-Book Ratio of Common Stock 164.6%
21
<PAGE>
e) Analysis of Growth in Retained Earnings for GPU, Inc. and
Subsidiary Companies:
(In Thousands)
--------------
Retained Earnings as of 12/31/97 $ 2,140,712
Retained Earnings as of 9/30/97 2,175,590
---------
Growth in Retained Earnings $ (34,878)
==========
Analysis of Growth in Retained Earnings:
- ----------------------------------------
Income (loss) contribution from GPU Energy companies $ 64,437
Income (loss) contribution from FUCOs/EWGs/Project Parents 34,986
Income (loss) contribution from other subsidiary companies (6,513)
Cash dividends declared on common stock (120,822)
Other adjustments (6,966)
-------
Growth in Retained Earnings $ (34,878)
========
f) Statements of operations for the year ended December 31, 1997 for
each of the following Project Parents and Exempt Entities, other than Selkirk
Cogen Partners, LP, will be filed separately under a request for confidential
treatment pursuant to Rule 104(b):
- Mid Georgia Cogen, LP
- NCP Houston Power Incorporated
- Selkirk Cogen Partners, LP - incorporated by reference to
22
<PAGE>
Selkirk's report on Form 10-K for the year ended December 31, 1997 filed with
the SEC.
- Empresa Guaracachi, S.A.
- GPU International Colombia, Ltda.
- Solaris Power
- Midlands Electricity, plc
- Termobarranquilla, S.A.
- Los Amigos Leasing Company, Ltd.
- EI Services Canada, Ltd.
- Brooklyn Energy, LP
- GPU International Australia Pty Ltd.
- GPU PowerNet Pty. Ltd.
23
<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: April 28, 1998
