SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
__________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of
earliest event reported): December 11, 1995
GENERAL PUBLIC UTILITIES CORPORATION
(Exact name of registrant as specified in charter)
Pennsylvania 1-6047 13-5516589
(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation)
100 Interpace Parkway, Parsippany, New Jersey 07054
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (201) 263-6500
<PAGE>
ITEM 5. OTHER EVENTS.
On December 11, 1995, General Public Utilities
Corporation ("GPU") entered into an Underwriting Agreement with
Morgan Stanley & Co. Incorporated, Goldman, Sachs & Co. and Dean
Witter Reynolds Inc., as representatives of the several
underwriters, including themselves, named therein (the
"Underwriters"), providing for the issuance and sale of 3.5
million shares of GPU's Common Stock, par value $2.50 per share.
Under the Underwriting Agreement, the Underwriters have a 30-day
option to purchase up to an additional 500,000 shares of Common
Stock to cover over-allotments, if any. The new issue is part of
an existing shelf registration of five million shares, one
million shares of which were sold in a block transaction in June
1995 (as previously reported). GPU will use the proceeds from
the offering to make cash capital contributions to its
subsidiaries and repay outstanding short-term debt.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS.
(c) Exhibits.
1. Underwriting Agreement dated December 11,
1995 between GPU and Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co. and Dean
Witter Reynolds Inc., as representatives.<PAGE>
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE
ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE
SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY
AUTHORIZED.
GENERAL PUBLIC UTILITIES CORPORATION
By:
T. G. Howson
Vice President and Treasurer
Date: December 13, 1995<PAGE>
EXHIBIT TO BE FILED BY EDGAR
Exhibit:
1. Underwriting Agreement dated December 11,
1995 between GPU and Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co. and Dean
Witter Reynolds Inc., as representatives.<PAGE>
Exhibit 1
3,500,000 Shares
GENERAL PUBLIC UTILITIES CORPORATION
(a Pennsylvania corporation)
Common Stock
($2.50 Par Value)
UNDERWRITING AGREEMENT
December 11, 1995
MORGAN STANLEY & CO. INCORPORATED
GOLDMAN, SACHS & CO.
DEAN WITTER REYNOLDS INC.
As Representatives of the several Underwriters
c/o MORGAN STANLEY & CO. INCORPORATED
1585 Broadway
New York, New York 10036-8293
Ladies and Gentlemen:
General Public Utilities Corporation, a Pennsylvania
corporation (the "Company"), confirms its agreement with Morgan
Stanley & Co. Incorporated, Goldman, Sachs & Co. and Dean Witter
Reynolds Inc., and each of the other Underwriters, if any, named
in Schedule A hereto (collectively, the "Underwriters", which
term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom you are
acting as representatives (in such capacity, you shall
hereinafter be referred to as the "Representatives"), with
respect to the sale by the Company and the purchase by the
Underwriters, acting severally and not jointly, of the respective
numbers of shares of Common Stock, $2.50 par value per share, of
the Company (the "Common Stock") set forth in Schedule A hereto.
The shares of Common Stock to be purchased by the Underwriters as
set forth in Schedule A are hereinafter called the "Firm
Securities". The Company also proposes to issue and sell to the
several Underwriters not more than an additional 500,000 shares
of its Common Stock (the "Additional Securities") if and to the
extent that the Representatives, on behalf of the Underwriters,
shall have determined to exercise the right to purchase the
Additional Securities pursuant to Section 2 hereof. The Firm<PAGE>
Securities and the Additional Securities are hereinafter
collectively referred to as the "Securities."
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-
3 (No. 33-56475) and Amendment No. 1 thereto relating to the
Securities under the Securities Act of 1933, as amended (the
"1933 Act"). Such registration statement, as amended by
Amendment No. 1, has been declared effective by the Commission.
Such registration statement, as amended by Amendment No. 1, and
the prospectus constituting a part thereof (including in each
case all documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the 1933 Act (the "Incorporated
Documents") as from time to time hereafter amended or
supplemented pursuant to the 1933 Act, the rules and regulations
of the Commission under the 1933 Act (the "1933 Act
Regulations"), the Securities Exchange Act of 1934, as amended
(the "1934 Act"), or the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), are hereinafter referred
to as the "Registration Statement" and the "Basic Prospectus",
respectively, except that if any revised prospectus shall be
provided to the Underwriters by the Company for use in connection
with the offering of the Securities which differs from the Basic
Prospectus on file at the Commission at the time the Registration
Statement became effective (whether or not such revised
prospectus is required to be filed by the Company pursuant to
Rule 424(b) of the 1933 Act Regulations), the term "Basic
Prospectus" shall refer to such revised prospectus from and after
the time it is first provided to the Underwriters for such use.
The term "Prospectus" means the Basic Prospectus together with
the prospectus supplement specifically relating to the
Securities, as filed with, or transmitted for filing to, the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations.
The term "preliminary prospectus" means a preliminary prospectus
supplement specifically relating to the Securities together with
a Basic Prospectus. References to the terms "Registration
Statement", "Basic Prospectus", "preliminary prospectus" and
"Prospectus" shall, unless otherwise specified, be deemed to
refer to the Registration Statement, the Basic Prospectus, any
preliminary prospectus and the Prospectus as amended or
supplemented to the date of this Agreement.
All references in this Agreement to financial
statements and schedules and other information which is
"contained," "included" or "stated" in the Registration
Statement, the Basic Prospectus, any preliminary prospectus or
the Prospectus (and all other references of like import) shall be
deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be
incorporated by reference in the Registration Statement, the
Basic Prospectus, any preliminary prospectus or the Prospectus,
as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, the
Basic Prospectus, any preliminary prospectus or the Prospectus
shall be deemed to mean and include the filing of any document
6<PAGE>
under the 1934 Act which is or is deemed to be incorporated by
reference in the Registration Statement, the Basic Prospectus,
any preliminary prospectus or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties. (a) The
Company represents and warrants to each Underwriter as of the
date of this Agreement as follows:
(i) The Registration Statement, at the time it
was declared effective by the Commission under the 1933 Act
and at each date any post-effective amendment or post-
effective amendments thereto became effective (the
"Effective Date"), complied and, as of the date of this
Agreement, complies in all material respects with the
applicable requirements of the 1933 Act and the 1933 Act
Regulations. Each preliminary prospectus and the
Prospectus, when filed by the Company with the Commission
pursuant to Rule 424 of the 1933 Act Regulations, complied
or will comply in all material respects with the applicable
requirements of the 1933 Act and the 1933 Act Regulations.
The Registration Statement, at the Effective Date, did not
and, at the date of this Agreement, does not contain an
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading. The Prospectus,
at the time it was first provided to the Underwriters for
use in connection with the offering of the Securities
(whether or not required to be filed by the Company with the
Commission pursuant to Rule 424(b) of the 1933 Act
Regulations), did not and, as of the date of this Agreement,
does not and, as of the Closing Time (as defined in
Section 2(c) hereof) and, in respect of Additional
Securities, at the Option Closing Time (as defined in
Section 2(c) hereof), will not include an untrue statement
of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading. The Incorporated Documents, at the time they
were or hereafter are filed with the Commission, complied
and will comply in all material respects with the applicable
requirements of the 1934 Act and the 1934 Act Regulations,
and, when read together with the other information in the
Basic Prospectus at the Effective Date and the Prospectus at
the date hereof and the Closing Time or the Option Closing
Time, as the case may be, do not and will not contain an
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statements therein, in the light of the
circumstances under which they were made, not misleading.
The representations and warranties in this subsection shall
not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance
upon and in conformity with information furnished to the
Company in writing by any Underwriter through any
Representative expressly for use in the Registration
7<PAGE>
Statement or the Prospectus, but nothing contained herein is
intended as a waiver of compliance with the 1933 Act, the
1934 Act, the 1933 Act Regulations or the 1934 Act
Regulations.
(ii) The accountants who certified the financial
statements and supporting schedules included or incorporated
by reference in the Prospectus are independent certified
accountants (the "Independent Accountants") with respect to
the Company within the meaning of the 1933 Act and the 1933
Act Regulations.
(iii) The consolidated financial statements
included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the financial
position of the Company and its subsidiaries as at the dates
indicated and the results of their operations for the
periods specified; except as otherwise stated in the
Registration Statement, such financial statements have been
prepared in conformity with generally accepted accounting
principles applied on a consistent basis; and the supporting
schedules included or incorporated by reference in the
Registration Statement present fairly the information
required to be stated therein.
(iv) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there
has been no material adverse change, nor any development
involving a prospective material adverse change, in the
financial or business condition or in the earnings or
business of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary
course of business, (B) there have been no transactions
entered into by the Company or any of its subsidiaries,
other than those in the ordinary course of business, that
are material with respect to the Company and its
subsidiaries considered as one enterprise and (C) except for
regular quarterly dividends, there has been no dividend or
distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(v) The Company is duly incorporated and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania with corporate
power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectus;
and the Company is duly qualified as a foreign corporation
to transact business and is in good standing in each
jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so
qualify would not have a material adverse effect on the
financial or business condition or the earnings or business
8<PAGE>
of the Company and its subsidiaries considered as one
enterprise.
(vi) Each of Jersey Central Power & Light Company,
Metropolitan Edison Company, Pennsylvania Electric Company
and Energy Initiatives, Inc. (the "Significant
Subsidiaries") is duly incorporated and is validly existing
as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and is
duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
except where the failure to so qualify would not have a
material adverse effect on the financial or business
condition or the earnings or business of the Company and its
subsidiaries considered as one enterprise; all of the issued
and outstanding capital stock of each of the Significant
Subsidiaries has been duly authorized and validly issued, is
fully paid and non-assessable and, other than the preferred
stock of the Significant Subsidiaries, is owned by the
Company directly, free and clear of any security interest,
mortgage, pledge, lien or claim.
(vii) The authorized, issued and outstanding
capital stock of the Company are as set forth in the
Prospectus under "Certain Consolidated Financial
Information" and "Description of Common Stock" (except for
subsequent issuances, if any, pursuant to such reservations,
agreements, employee and director benefit plans or the
Company's Dividend Reinvestment and Stock Purchase Plan as
are referred to in the Prospectus and the sale of 1,000,000
shares of Common Stock in June 1995); the shares of issued
and outstanding Common Stock have been duly authorized and
validly issued and are fully paid and non-assessable; the
Securities have been duly authorized for issuance and sale
to the Underwriters pursuant to this Agreement and, when
issued and delivered by the Company pursuant to this
Agreement against payment of the consideration therefor,
will be validly issued and fully paid and non-assessable;
the Common Stock conforms to all statements relating thereto
contained in the Prospectus under "Certain Consolidated
Financial Information" and "Description of Common Stock";
and the issuance of the Securities pursuant to this
Agreement is not subject to preemptive or other similar
rights.
(viii) Neither the Company nor any of the
Significant Subsidiaries is in violation of its Articles of
Incorporation or Certificate of Incorporation, as the case
may be, or in default in the performance or observance of
any material obligation, agreement, covenant or condition
contained in any material contract, indenture, mortgage,
9<PAGE>
loan agreement, note, lease or other instrument to which the
Company or any of the Significant Subsidiaries is a party or
by which it or any of them may be bound, or to which any of
the property or assets of the Company or any of the
Significant Subsidiaries is subject; and the execution,
delivery and performance of this Agreement and the
consummation of the transactions contemplated herein have
been duly authorized by all necessary corporate action and
will not conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the
Company or any of the Significant Subsidiaries pursuant to,
any material contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company or any
of the Significant Subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or
assets of the Company or any of the Significant Subsidiaries
is subject, nor will such action result in any violation of
the provisions of the Articles of Incorporation or by-laws
of the Company or any applicable law, administrative or
court decree or, to the best knowledge of the Company, any
administrative regulation.
(ix) There is no action, suit or proceeding before
or by any court or governmental agency or body, domestic or
foreign, now pending or, to the knowledge of the Company,
threatened, against the Company or any of the Significant
Subsidiaries, that is required to be disclosed in the
Registration Statement, or which, if adversely decided,
would result in any material adverse change in the financial
or business condition or in the earnings or business of the
Company and its subsidiaries considered as one enterprise,
or which, if adversely decided, would materially and
adversely affect the properties or assets thereof or would
materially and adversely affect the consummation of this
Agreement other than such actions, suits or proceedings
which are disclosed in or contemplated by the Registration
Statement; and there are no contracts or documents of the
Company or any of its subsidiaries which are required to be
filed as exhibits to the Registration Statement by the 1933
Act or by the 1933 Act Regulations which have not been so
filed.
(x) No authorization, approval or consent of any
court or governmental authority or agency is necessary in
connection with the sale by the Company of the Securities
hereunder, except such as may be required under the 1933 Act
or the 1933 Act Regulations, the Public Utility Holding
Company Act of 1935, as amended (the "1935 Act"), or state
securities laws.
(xi) The Company and the Significant Subsidiaries
possess such certificates, authorizations or permits issued
by the appropriate state, federal or foreign regulatory
agencies or bodies except such as to which the failure to
10<PAGE>
possess the same would not materially and adversely affect
the financial or business condition or the earnings or
business of the Company and its Significant Subsidiaries
considered as one enterprise and neither the Company nor any
of the Significant Subsidiaries has received any notice of
proceedings relating to the revocation or modification of
any such certificate, authority or permit that, singly or in
the aggregate, if the subject of an unfavorable decision,
ruling or finding, would materially and adversely affect the
financial or business condition or the earnings or business
of the Company and its subsidiaries considered as one
enterprise.
(b) Any certificate signed by any officer of the
Company and delivered to the Representatives or to counsel for
the Underwriters shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered
thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties
herein contained, and subject to the terms and conditions herein
set forth, the Company agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and
not jointly, agrees to purchase from the Company, at a purchase
price of $31.975 per share, the number of Firm Securities set
forth in Schedule A hereto opposite the name of such Underwriter,
plus any additional number of Firm Securities which such
Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
On the basis of the representations and warranties
contained in this Agreement, and subject to the terms and
conditions herein set forth, the Company agrees to sell to each
of the Underwriters, and the Underwriters shall have a one-time
right to purchase from the Company, severally and not jointly, at
a purchase price of $31.975 per share, in the aggregate up to
500,000 Additional Securities. If the Representatives, on behalf
of the Underwriters, elect to exercise such option, the
Representatives shall so notify the Company in writing not later
than 30 days after the date of this Agreement, which notice shall
specify the number of Additional Securities to be purchased by
the Underwriters and the date on which such shares are to be
purchased. Such date may be the same as the Closing Time (as
defined below) but not later than ten business days after the
date of such notice. Additional Securities may be purchased as
provided in Section 2(c) hereof solely for the purpose of
covering over-allotments made in connection with the public
offering of the Firm Securities. If any Additional Securities
are to be purchased, each Underwriter agrees, severally and not
jointly, to purchase the number of Additional Securities (subject
to such adjustments to eliminate fractional shares as you may
determine) that bears the same proportion to the total number of
Additional Securities to be purchased as the number of Firm
11<PAGE>
Securities set forth opposite the name of such Underwriter in
Schedule A hereto bears to the total number of Firm Securities.
(b) The Company has been advised by the
Representatives that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem
advisable after this Agreement has been executed and delivered.
The Company has further been advised that the Underwriters
propose to initially offer the Securities to the public at the
public offering price of $32.875 per share.
(c) Payment of the purchase price for, and delivery of
certificates for, the Securities shall be made at the office of
Berlack, Israels & Liberman LLP, 120 West 45th Street, New York,
New York 10036, or at such other place as shall be agreed upon by
the Representatives and the Company, at 10:00 A.M. on December
15, 1995 (unless postponed in accordance with the provisions of
Section 10 hereof), or such other time not later than five
business days after such date as shall be agreed upon by the
Representatives and the Company (such time and date of payment
and delivery being herein called the "Closing Time"). Payment
shall be made to the Company by certified or official bank check
or checks drawn in New York Clearing House funds payable to the
order of the Company, against delivery to the Representatives for
the respective accounts of the Underwriters of certificates for
the Securities to be purchased by them. Payment for any
Additional Securities shall be made as provided above except that
the hour and date shall be designated in a written notice from
the Representatives to the Company (the "Option Closing Time")
(which may be the same as the Closing Time but shall in no event
be earlier than the Closing Time nor later than ten business days
after the giving of the notice herein referred to). Such notice
shall include the number of the Additional Securities to be
purchased. Such notice of the determination to exercise the
option to purchase Additional Securities and of the Option
Closing Time may be given at any time within 30 days of the date
of this Agreement.
Certificates for the Securities shall be in such
denominations and registered in such names as the Representatives
may request in writing at least two business days before the
Closing Time or the Option Closing Time, as the case may be. It
is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of, receipt
for, and make payment of the purchase price for, the Securities
that it has agreed to purchase. Morgan Stanley & Co.
Incorporated, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of
the purchase price for the Securities to be purchased by any
Underwriter whose check has not been received by the Closing Time
or the Option Closing Time, as the case may be, but such payment
shall not relieve such Underwriter from its obligations
hereunder. The certificates for the Securities will be made
available for examination and packaging by the Representatives
not later than 10:00 A.M. on the last business day prior to the
12<PAGE>
Closing Time or the Option Closing Time, as the case may be, at
the office of Chemical Bank, Corporate Trust Group, 55 Water
Street, 2nd Floor, Room 234, New York, New York 10041.
SECTION 3. Covenants of the Company. The Company
covenants with each Underwriter as follows:
(a) The Company will notify the Representatives
immediately (i) of the effectiveness of any amendment to the
Registration Statement, (ii) of the transmittal to the Commission
for filing of any supplement to the Prospectus, or any document
to be filed pursuant to the 1934 Act which will be incorporated
or deemed to be incorporated by reference in the Prospectus,
(iii) of the receipt of any comments from the Commission, (iv) of
any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus or for additional information and (v) of the issuance
by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the initiation of any
proceedings for that purpose. The Company will make every
reasonable effort to prevent the issuance of any stop order and,
if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) During the period referred to in (e) below, the
Company will give the Representatives notice of its intention to
file any amendment (including any post-effective amendment) to
the Registration Statement or any amendment or supplement to the
Prospectus (including any document to be filed pursuant to the
1934 Act which will be incorporated or deemed to be incorporated
by reference therein) and will furnish the Representatives with
copies of any such amendment or supplement within a reasonable
amount of time prior to such proposed filing or use, as the case
may be, and prior to the Option Closing Time, will not file any
such amendment or supplement or use any such prospectus to which
the Representatives or counsel for the Underwriters shall
reasonably object in writing.
(c) The Company will deliver to the Representatives
three signed copies of the Registration Statement as originally
filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein) and will also
deliver to the Representatives a conformed copy of the
Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the Underwriters.
(d) The Company will furnish to the Representatives
for the use by the Underwriters, from time to time during the
period when the Prospectus is required to be delivered under the
1933 Act or the 1934 Act, such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably
request for the purposes contemplated by the 1933 Act or the 1933
Act Regulations, or the 1934 Act or the 1934 Act Regulations.
13<PAGE>
(e) If, during such period (not in excess of nine
months) after the first date of the public offering of the
Securities as in the opinion of your counsel a prospectus
covering the Securities is required by law to be delivered in
connection with sales by an Underwriter or any dealer, any event
shall occur as a result of which it is necessary to amend or
supplement the Prospectus in order to make the Prospectus not
misleading in the light of the circumstances existing at the time
it is delivered to a purchaser, the Company will forthwith amend
or supplement the Prospectus so that, as so amended or
supplemented, the Prospectus will not include an untrue statement
of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a
purchaser, not misleading, and the Company will furnish to the
Representatives for the use by the Underwriters a reasonable
number of copies of such amendment or supplement.
(f) The Company will endeavor, in cooperation with the
Underwriters, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other
jurisdictions of the United States as the Representatives may
reasonably designate. In each jurisdiction in which the
Securities have been so qualified, the Company will file such
statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect until the
distribution of all of the Securities has been completed.
Notwithstanding the foregoing, the Company shall not be obligated
to qualify as a foreign corporation in any jurisdiction in which
it is not so qualified or to file a general consent to service of
process.
(g) The Company will make generally available to its
security holders as soon as practicable, but not later than 60
days after the close of the period covered thereby, an earning
statement covering a twelve month period beginning not later than
the first day of the Company's fiscal quarter next following the
Effective Date of the Registration Statement, which earning
statement shall satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 of the 1933 Act Regulations and which need
not be certified by independent public accountants unless
required by the 1933 Act.
(h) The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the
Prospectus under "Use of Proceeds."
(i) The Company will prepare, and file or
electronically transmit for filing with the Commission not later
than the second business day following execution and delivery of
this Agreement in accordance with Rule 424(b) of the 1933 Act
Regulations, the Prospectus as amended and supplemented in
relation to the Securities in a form approved by the
Representatives.
14<PAGE>
(j) The Company, during the period when the Prospectus
is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the 1934 Act within the time
periods required by the 1934 Act and the 1934 Act Regulations.
SECTION 4. Payment of Expenses. Except as otherwise
provided in this Agreement, the Company will pay all expenses
incident to the performance of its obligations under this
Agreement, including (a) the printing and filing of the
Registration Statement as originally filed and of each amendment
thereto, (b) the reproduction of this Agreement, (c) the
preparation, issuance and delivery of the certificates for the
Securities to the Underwriters, (d) the fees and disbursements of
the Company's counsel and accountants, (e) the qualification of
the Securities under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the
fee and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of
the Blue Sky Survey (not to exceed in the aggregate $7,500), (f)
the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment
thereto, of the preliminary prospectuses, and of the Prospectus
and any amendments or supplements thereto, (g) the reproduction
and delivery to the Underwriters of copies of the Blue Sky Survey
and (h) the fees and expenses incurred in connection with the
listing of the Securities on the New York Stock Exchange.
If this Agreement is terminated by the Representatives
or by the Company in accordance with the provisions of Section 5
hereof, the Company shall reimburse the Underwriters for all of
their reasonable out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriters.
SECTION 5. (A) Conditions of Underwriters' Obligations.
The obligations of the Underwriters hereunder are subject to the
accuracy, truth and correctness, at the date of this Agreement
and at the Closing Time of the representations and warranties of
the Company herein contained, to the performance by the Company
of its obligations hereunder, and to the following further
conditions:
(a) The Registration Statement shall have become
effective. No stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act
or proceedings therefor initiated or threatened by the Commission
and at the Closing Time an appropriate order of the Commission
under the 1935 Act shall be in effect. The Prospectus shall have
been transmitted to the Commission for filing pursuant to Rule
424(b) of the 1933 Act Regulations within the prescribed time
period and prior to the Closing Time and the Company shall have
provided evidence satisfactory to the Representatives of such
timely filing.
15<PAGE>
(b) At the Closing Time or at the Option Closing Time,
as the case may be, the Representatives shall have received:
(1) The favorable opinion, dated as of the
Closing Time or the Option Closing Time, as the case may be,
of Berlack, Israels & Liberman LLP, counsel for the Company,
in form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(i) The Company is duly incorporated and is
validly existing as a corporation in good standing
under the laws of the Commonwealth of Pennsylvania and
has corporate authority to own, lease and operate its
properties and to conduct its business as described in
the Prospectus; and the Company is duly qualified as a
foreign corporation to transact business and is in good
standing in the State of New Jersey;
(ii) The authorized, issued and outstanding
capital stock of the Company are as set forth in the
Prospectus under "Certain Consolidated Financial
Information" and "Description of Common Stock" (except
for subsequent issuances, if any, pursuant to such
reservations, agreements, employee and director benefit
plans or the Company's Dividend Reinvestment and Stock
Purchase Plan as are referred to in the Prospectus and
the sale of 1,000,000 shares of Common Stock in June
1995), and the shares of issued and outstanding Common
Stock have been duly authorized and validly issued and
are fully paid and non-assessable;
(iii) The Securities have been duly authorized
for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the
Company pursuant to this Agreement against payment
therefor, will be validly issued and fully paid and
non-assessable;
(iv) The issuance of the Securities pursuant
to this Agreement is not subject to preemptive or other
similar rights arising under the Pennsylvania Business
Corporation Law or under the Articles of Incorporation
or by-laws of the Company;
(v) Each Significant Subsidiary of the
Company is duly incorporated and is validly existing as
a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power
and authority to own, lease and operate its properties
and to conduct its business as described in the
Prospectus and, to the best of their knowledge, except
with respect to Energy Initiatives, Inc. as to which
such counsel need express no opinion, each such
Significant Subsidiary is duly qualified as a foreign
corporation to transact business and is in good
16<PAGE>
standing in each jurisdiction in which such
qualification is required, except where the failure to
be so qualified would not have a material adverse
effect on the financial or business condition or the
earnings or business of such Significant Subsidiaries;
all of the issued and outstanding common stock of each
Significant Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and,
to the best of their knowledge, is owned by the Company
directly, free and clear of any security interest,
mortgage, pledge, lien or claim;
(vi) This Agreement has been duly authorized,
executed and delivered by the Company;
(vii) The Registration Statement is effective
under the 1933 Act and, to the best of their knowledge,
no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933
Act or proceedings therefor initiated or threatened by
the Commission;
(viii) The Registration Statement, at the
Effective Date, and the Prospectus, at the date it was
electronically transmitted for filing to the Commission
pursuant to Rule 424(b) and as of the Closing Time
(other than the financial statements and supporting
schedules and other financial or statistical data
included or incorporated by reference therein, as to
which no opinion need be rendered) complied as to form
in all material respects with the applicable
requirements of the 1933 Act and the 1933 Act
Regulations; and the Incorporated Documents, at the
time they were filed with the Commission, complied as
to form with the applicable requirements of the 1934
Act and the 1934 Act Regulations;
(ix) The Common Stock conforms to the
description thereof contained in the Prospectus under
the caption "Description of Common Stock", and the form
of certificate used to evidence the Common Stock is in
due and proper form and complies with all applicable
statutory requirements;
(x) To the best of their knowledge, there
are no legal or governmental proceedings pending or
threatened against the Company which are required to be
disclosed in the Prospectus, other than those disclosed
therein;
(xi) To the best of their knowledge, there
are no contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required
to be filed as exhibits to the Registration Statement
17<PAGE>
other than those filed or incorporated by reference as
exhibits thereto; and
(xii) No authorization, approval, consent or
order of any court or governmental authority or agency
is required in connection with the sale of the
Securities to the Underwriters, except such as may be
required under the 1933 Act or the 1933 Act
Regulations, the 1935 Act or state securities laws;
and, to the best of their knowledge, the execution and
delivery of this Agreement and the consummation of the
transactions contemplated therein will not conflict
with or constitute a breach of, or default under, or
result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of
the Company or any of its Significant Subsidiaries
pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other
instrument to which the Company or any of its
Significant Subsidiaries is a party or by which it or
any of them may be bound, or to which any of the
property or assets of the Company or any of its
Significant Subsidiaries is subject nor will such
action result in any violation of the provisions of the
Articles of Incorporation or by-laws of the Company, or
any law or administrative regulation applicable to the
Company or administrative or court decree binding upon
the Company.
In giving such opinion, Berlack, Israels & Liberman LLP
may rely (i) as to all matters of New Jersey law and legal
conclusions based thereon, upon the opinion of Richard S.
Cohen, Esq., (ii) as to matters of Pennsylvania law and
legal conclusions based thereon regarding Metropolitan
Edison Company, upon the opinion of Ryan, Russell, Ogden &
Seltzer, Reading, Pennsylvania, (iii) as to all other
matters of Pennsylvania law and legal conclusions based
thereon upon the opinion of Ballard Spahr Andrews &
Ingersoll, Philadelphia, Pennsylvania and (iv) as to matters
of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
(2) The favorable opinion, dated as of the
Closing Time or the Option Closing Time, as the case may be,
of Winthrop, Stimson, Putnam & Roberts, counsel for the
Underwriters, with respect to the matters set forth in (iii)
and (vi) to (ix), inclusive, of subsection (b)(1) of this
Section, except that, with respect to the matters referred
to in (ix), no opinion need be expressed as to whether any
of the Company's outstanding shares of Common Stock, other
than the Securities, have been duly authorized or validly
issued or are fully paid or non-assessable.
In giving such opinion, counsel for the Underwriters
may rely (i) as to all matters of New Jersey law and legal
18<PAGE>
conclusions based thereon, upon the opinion of Richard S.
Cohen, Esq., (ii) as to matters of Pennsylvania law and
legal conclusions based thereon regarding Metropolitan
Edison Company, upon the opinion of Ryan, Russell, Ogden &
Seltzer, Reading, Pennsylvania, (iii) as to all other
matters of Pennsylvania law and legal conclusions based
thereon upon the opinion of Ballard Spahr Andrews &
Ingersoll, Philadelphia, Pennsylvania and (iv) as to matters
of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
(3) In giving their opinions required by
subsections (b)(1) and (b)(2), respectively, of this
Section, Berlack, Israels & Liberman LLP and Winthrop,
Stimson, Putnam & Roberts shall each additionally state that
nothing has come to their attention that would lead them to
believe that the Registration Statement (except for
financial statements and supporting schedules and other
financial or statistical data included or incorporated by
reference therein, as to which counsel need make no
statement), at the Effective Date or at the date hereof,
contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or
that the Prospectus (except for financial statements and
supporting schedules and other financial or statistical data
included or incorporated by reference therein, as to which
counsel need make no statement), at the date it was
electronically transmitted for filing to the Commission
pursuant to Rule 424 or at the Closing Time, included or
includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made, not misleading.
(c) At the Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which
information is given in the Registration Statement and the
Prospectus except as otherwise stated or contemplated therein,
any material adverse change, or any development involving a
prospective material adverse change, in the financial or business
condition or in the earnings or business of the Company and its
subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, and the Representatives shall
have received a certificate of the President or a Vice President
of the Company and of the Chief Financial or Chief Accounting
Officer of the Company, dated as of the Closing Time or the
Option Closing Time, as the case may be, to the effect that (i)
there has been no such material adverse change or development
involving a material adverse change, (ii) the representations and
warranties in Section l are accurate, true and correct in all
material respects with the same force and effect as though
expressly made at and as of the Closing Time or the Option
Closing Time, as the case may be, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to
19<PAGE>
be performed or satisfied at or prior to the Closing Time or the
Option Closing Time, as the case may be, and (iv) no stop order
suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been
initiated or, to the best of their knowledge, threatened by the
Commission.
(d) At the time of the execution of this Agreement the
Representatives shall have received from the Independent
Accountants a letter dated the date of this Agreement, in form
and substance satisfactory to the Representatives, confirming,
through a specified date not more than five days prior to the
date of this Agreement, that they are independent certified
accountants with respect to the Company and its subsidiaries
within the meaning of the 1933 Act and the 1933 Act Regulations
and stating in effect that (i) in their opinion, the financial
statements and supplemental schedules of the Company and its
subsidiaries audited by them and incorporated by reference in the
Prospectus and included or incorporated by reference in the
Company's most recent Annual Report on Form 10-K comply as to
form in all material respects with the applicable accounting
requirements of the 1934 Act and the 1934 Act Regulations, (ii)
on the basis of (1) procedures performed, as specified by the
American Institute of Certified Public Accountants for a review
of interim financial information as described in SAS No. 71,
Interim Financial Information, on the unaudited balance sheets
and related unaudited condensed statements of income, retained
earnings and cash flows of the Company incorporated by reference
in the Registration Statement and included in the Company's
quarterly reports on Form 10-Q for the quarters ended March 31,
June 30 and September 30, 1995 (collectively, the "Form 10-Qs"),
(2) a reading of the latest unaudited operating revenues and net
income included or incorporated by reference in the Prospectus,
(3) a reading of the minutes of the meetings of the stockholders
and the Board of Directors as set forth in the minute books since
December 31, 1994 and (4) inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters (it being understood that the foregoing procedures do not
constitute an audit made in accordance with generally accepted
auditing standards and would not necessarily reveal matters of
significance with respect to the comments made in such letter,
and accordingly that the Independent Accountants make no
representations as to the sufficiency of such procedures for the
Representatives' purposes), nothing has come to their attention
which caused them to believe that (A) the unaudited financial
statements included in the Form 10-Qs do not comply as to form in
all material respects with the applicable accounting requirements
of the 1934 Act and the 1934 Act Regulations, or that any
material modifications should be made to said unaudited financial
statements for them to be in conformity with generally accepted
accounting principles or (B) on the date of the latest available
financial statements and on a specified date not more than five
days prior to the date of this Agreement, as the case may be,
there was any change in the common stock, cumulative preferred
stock without mandatory redemption, cumulative preferred stock
20<PAGE>
with mandatory redemption, subsidiary-obligate mandatorily
redeemable preferred securities or long-term debt (except for
such stock and long-term debt acquired for sinking fund purposes
or redeemed pursuant to sinking fund provisions, or changes in
obligations under capital leases incurred in the ordinary course
of the Company's business and the amortization of discounts and
premiums or as otherwise stated in such letter), of the Company,
or any decrease in its net assets (except as occasioned by the
declaration of dividends), in each case as compared with the
amounts shown in the most recent balance sheet included in the
most recent Form 10-K or Form 10-Q, except in all instances for
changes or decreases which the Registration Statement discloses
have occurred or may occur and (iii) on the basis of a reading of
the latest unaudited operating revenues and net income for the
most recent 12-month period included or incorporated by reference
in the Registration Statement, they have derived such financial
information from the audited and unaudited financial statements
included in the Form 10-K or the Form 10-Qs incorporated by
reference in the Registration Statement. Such letter shall also
cover such other matters as the Representatives may reasonably
request.
(e) At the Closing Time the Representatives shall have
received from the Independent Accountants a letter, dated as of
the Closing Time, in form and substance satisfactory to the
Representatives, to the effect that they reaffirm the statements
made in the letter furnished pursuant to subsection (d) of this
Section 5(A), except that the specified date referred to therein
shall be a date not more than five days prior to the Closing
Time.
At the Option Closing Time, the Representatives shall
have received from the Independent Accountants a letter, dated as
of the Option Closing Time, in form and substance satisfactory to
the Representatives to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection
(d) of this Section 5(A), except that the specified date referred
to therein shall be a date not more than five days prior to the
Option Closing Time.
(f) At the Closing Time or the Option Closing Time, as
the case may be, counsel for the Underwriters shall have been
furnished with such documents as they may reasonably require for
the purpose of enabling them to pass upon the issuance and sale
of the Securities as herein contemplated and related proceedings,
or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of the
Securities as herein contemplated shall be reasonably
satisfactory in form and substance to counsel for the
Underwriters.
21<PAGE>
(g) At the Closing Time or the Option Closing Time, as
the case may be, the Securities shall have been approved for
listing on the New York Stock Exchange upon notice of issuance.
If any condition specified in this Section 5(A) shall
not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Representatives by notice
to the Company at any time at or prior to the Closing Time or the
Option Closing Time, as the case may be, and such termination
shall be without liability of any party to any other party except
as provided in Section 4 hereof.
(B) Conditions of the Company's Obligations. The
obligations of the Company hereunder are subject to the
performance of the Underwriters of their obligations hereunder,
and to the following additional conditions:
(a) The Registration Statement shall have become
effective and no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act
or proceedings therefor initiated or threatened by the
Commission.
(b) There shall be in full force and effect
appropriate orders of the Commission under the 1935 Act
authorizing the issuance and sale of the Securities.
If any condition specified in this Section 5(B) shall
not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Company by notice to the
Representatives at any time at or prior to the Closing Time or
the Option Closing Time, as the case may be, and such termination
shall be without liability of any party to any other party except
as provided in Section 4 hereof.
SECTION 6. Indemnification. (a) The Company agrees
to indemnify and hold harmless each Underwriter, its officers,
directors, employees and agents and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of
any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or
any amendment thereto) or the omission or alleged omission
therefrom of a material fact required to be stated therein
or necessary to make the statements therein not misleading
or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements
22<PAGE>
therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of
the aggregate amount paid in settlement of any litigation,
or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim
whatsoever, based upon any such untrue statement or
omission, or any such alleged untrue statement or omission,
if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as
incurred (including, subject to Section 6(c) hereof, the
reasonable fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating,
preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever,
based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply
to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with written information furnished to the Company by any
Underwriter through any Representative expressly for use in the
Registration Statement (or any amendment thereto) or any
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto); provided further, however, that this
indemnity shall not inure to the benefit of any Underwriter, its
officers, directors, employees and agents and each person, if
any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act on account of
any loss, liability, claim, damage or expense arising from the
sale of the Securities to any person if a copy of the Prospectus,
as the same may be supplemented or amended (excluding, however,
any document then incorporated or deemed incorporated therein by
reference), was not sent or given by or on behalf of such
Underwriter to such person with or prior to the written
confirmation of the sale involved and the alleged omission or
alleged untrue statement was corrected in the Prospectus as
supplemented or amended at the time of such confirmation, unless
the failure to send or give the Prospectus as so amended or
supplemented resulted from the Company's failure to comply with
Section 3(e) hereof.
(b) Each Underwriter, acting severally and not
jointly, agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration
Statement, employees, agents and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933
23<PAGE>
Act or Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section 6, as incurred, but
only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration
Statement (or any amendment thereto) or any preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through
any Representative expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto). In case any action shall be brought against the
Company or any person so indemnified based on the Registration
Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto) and in respect of which indemnity may be sought against
any Underwriter, such Underwriter shall have the rights and
duties given to the Company, and the Company and each person so
indemnified shall have the rights and duties given to the
Underwriters in each case by the provisions of subsection (a) of
this Section 6.
(c) Each indemnified party shall give prompt notice to
each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure
to so notify an indemnifying party shall not relieve such
indemnifying party from any liability that it may have otherwise
than on account of this indemnity agreement. An indemnifying
party may participate at its own expense in the defense of such
action. If it so elects within a reasonable time after receipt
of such notice, an indemnifying party, jointly with any other
indemnifying parties receiving such notice, may assume the
defense of such action with counsel chosen by it reasonably
satisfactory to such indemnified parties in such action. If an
indemnifying party assumes the defense of such action, the
indemnifying parties shall not be liable for any fees and
expenses of counsel for the indemnified parties incurred
thereafter in connection with such action; provided, however,
that if such indemnified parties reasonably object to such
assumption on the ground that there may be legal defenses
available to them that are different from or in addition to those
available to such indemnifying party, then the reasonable fees
and expenses of separate counsel for the indemnified parties
shall be paid or reimbursed by the indemnifying parties and such
fees and expenses shall be paid or reimbursed as they are
incurred; provided further, however, that in no event shall the
indemnifying parties be liable for the fees and expenses of more
than one counsel (excluding local counsel) for all indemnified
parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the
same general allegations or circumstances. The indemnifying
party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the
24<PAGE>
indemnifying party agrees to indemnify the indemnified party from
and against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the fourth sentence of this paragraph
(c), the indemnifying party agrees that it shall be liable for
any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are
the subject matter of such proceeding.
SECTION 7. Contribution. In order to provide for just
and equitable contribution in circumstances in which the
indemnity agreement provided for in Section 6 hereof is for any
reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the Company and
the Underwriters shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature
contemplated by said indemnity agreement incurred by the Company
and one or more Underwriters in respect of such offering in such
proportions as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on
the other hand so that each Underwriter is responsible for that
portion represented by the percentage that the total commissions
and underwriting discounts received by such Underwriter to the
date of such liability bears to the total sales price received by
the Company from the sale of Securities to the date of such
liability, and the Company is responsible for the balance. If,
however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one
hand and the Underwriters of the Securities on the other in
connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable
considerations. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied
by the Company on the one hand or such Underwriters on the other
and the parties' relative intent, knowledge, access to
25<PAGE>
information and opportunity to correct or prevent such statement
or omission. Notwithstanding the provisions of this Section 7,
no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged
omission. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the
respective number of Securities they have purchased hereunder,
and not joint.
The Company and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by
any other method of allocation that does not take account of the
equitable considerations referred to in the preceding paragraph
of this Section 7. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
1933 Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. For
purposes of this Section, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act
shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933
Act shall have the same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements
to Survive Delivery. All representations, warranties and
agreements contained in this Agreement, or contained in
certificates of officers of the Company submitted pursuant
hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the
Company, and shall survive delivery of the Securities to the
Underwriters.
SECTION 9. Termination of Agreement. (a) The
Representatives, in consultation with the other Underwriters, may
terminate this Agreement, by notice to the Company, at any time
at or prior to the Closing Time or the Option Closing Time, as
the case may be, (i) if there has occurred any outbreak of
hostilities, or escalation thereof, or any change in financial
markets or other calamity or crisis that, in the judgment of
Morgan Stanley & Co. Incorporated, is material and adverse or
(ii) if trading in the Common Stock has been suspended by the
Commission, or trading of any securities of the Company has been
suspended on any exchange or in any over-the-counter market, or
trading generally on the New York Stock Exchange has been
suspended, or there shall have been established any general
limitation on prices for such trading or any general restrictions
26<PAGE>
on the distribution of securities by such Exchange or by order of
the Commission or any other governmental authority or (iii) if a
banking moratorium has been declared by either Federal or New
York authorities or (iv) if there has occurred any material
adverse change, or any development involving a prospective
material adverse change, in the financial or business condition
or in the earnings or business of the Company and its
subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, and (b) in the case of any of
the events specified in clauses (a)(i) through (iv), such event,
singly or together with any other such event, makes it, in the
judgment of Morgan Stanley & Co. Incorporated, impracticable to
market the Securities on the terms and in the manner contemplated
in the Prospectus or to enforce contracts for the sale of the
Securities.
(c) If this Agreement is terminated pursuant to this
Section 9, such termination shall be without liability of any
party to any other party except as provided in Sections 4 and 6
hereof.
SECTION 10. Default by One or More of the
Underwriters. If one or more of the Underwriters shall fail at
the Closing Time or the Option Closing Time to purchase the
Securities that it or they are obligated to purchase under this
Agreement on such date (the "Defaulted Securities"), the
Representatives shall have the right, within 24 hours thereafter,
to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may
be agreed upon and upon the terms herein set forth; provided,
however, that if the Representatives shall not have completed
such arrangements within such 24-hour period, then:
(a) If the number of Defaulted Securities does not
exceed 10% of the Securities to be purchased on such date, the
non-defaulting Underwriters shall be severally obligated to
purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters as
set forth in Schedule A hereto; provided, however, that in no
event shall the amount of Securities that any Underwriter has
agreed to purchase pursuant to this Agreement be increased
pursuant to this Section 10 by an amount in excess of 1/9th of
such amount without the written consent of such Underwriter.
(b) If the number of Defaulted Securities exceeds 10%
of the Securities to be purchased on such date, this Agreement
shall terminate without liability on the part of any non-
defaulting Underwriter or the Company, except with respect to the
payment of expenses to be borne by the Company and the
Underwriters as provided in Section 4 hereof and the indemnities
of the Company and the Underwriters contained in Section 6
hereof; provided, however, that if such date is an Option Closing
Date, the non-defaulting Underwriters shall have the option to
27<PAGE>
(i) terminate their obligation to purchase Additional Securities
or (ii) purchase not less than the number of Additional
Securities that such non-defaulting Underwriters would have been
obligated to purchase in the absence of such default.
No action taken pursuant to this Section 10 shall
relieve any defaulting Underwriter from liability in respect of
its default.
In the event of any such default that does not result
in a termination of this Agreement, either the Representatives or
the Company shall have the right to postpone the Closing Time or
the Option Closing Time, as the case may be, for a period not
exceeding seven days in order to effect any required changes in
the Registration Statement or the Prospectus, or any supplements
or amendments thereto, or in any other documents or arrangements.
SECTION 11. Notices. All notices and other
communications hereunder shall be in writing and shall be deemed
to have been duly given if hand delivered, mailed or transmitted
by telecopy confirmed in writing. Notices to the Underwriters
shall be directed to the Representatives, c/o Morgan Stanley &
Co. Incorporated, 1585 Broadway, New York, New York 10036-8293,
Attention: Registration Department; notices to the Company shall
be directed to it to the attention of Terrance G. Howson, Vice
President and Treasurer, GPU Service Corporation, 100 Interpace
Parkway, Parsippany, New Jersey 07054, with a copy thereof to
Douglas E. Davidson, Esq., Berlack, Israels & Liberman LLP, 120
West 45th Street, 29th Floor, New York, New York 10036.
SECTION 12. Parties. This Agreement shall inure to
the benefit of and be binding upon the Underwriters and the
Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters
and the Company and their respective successors and the
controlling persons, officers, directors, employees and agents
referred to in Section 6 hereof and their heirs and legal
representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of
the Underwriters and the Company and their respective successors,
and said controlling persons, officers, directors, employees and
agents and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of
Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. Governing Law and Time. This Agreement
shall be governed by and construed in accordance with the laws of
the State of New York applicable to agreements made and to be
performed in such State. Specified times of day refer to New
York City time.
28<PAGE>
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
Company a counterpart hereof, whereupon this instrument, along
with all counterparts, will become a binding agreement among the
Underwriters and the Company in accordance with its terms.
Very truly yours,
GENERAL PUBLIC UTILITIES
CORPORATION
By /s/ Terrance G. Howson
Name: Terrance G. Howson
Title:Vice President and
Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MORGAN STANLEY & CO. INCORPORATED
GOLDMAN, SACHS & CO.
DEAN WITTER REYNOLDS INC.
By: MORGAN STANLEY & CO. INCORPORATED
By: /s/ Thomas M. O'Flynn
Name: Thomas M. O'Flynn
Title: Principal
For themselves and as Representatives
of the other Underwriters named in Schedule A hereto.
29<PAGE>
SCHEDULE A
Number
Name of Underwriter of Shares
Morgan Stanley & Co. Incorporated . . . . . . . . . . . 630,000
Goldman, Sachs & Co. . . . . . . . . . . . . . . . . . 630,000
Dean Witter Reynolds Inc. . . . . . . . . . . . . . . . 630,000
Advest, Inc. . . . . . . . . . . . . . . . . . . . . . 35,000
Bear, Stearns & Co. Inc. . . . . . . . . . . . . . . . 70,000
CIBC Wood Gundy Securities Corp. . . . . . . . . . . . 35,000
CS First Boston Corporation . . . . . . . . . . . . . . 70,000
Dillon, Read & Co. Inc. . . . . . . . . . . . . . . . . 70,000
Donaldson, Lufkin & Jenrette Securities Corporation . . 70,000
A.G. Edwards & Sons, Inc. . . . . . . . . . . . . . . . 70,000
EVEREN Securities, Inc. . . . . . . . . . . . . . . . . 35,000
Fahnestock & Co. Inc. . . . . . . . . . . . . . . . . . 35,000
First Albany Corporation . . . . . . . . . . . . . . . 35,000
Furman Selz Incorporated . . . . . . . . . . . . . . . 35,000
Janney Montgomery Scott Inc. . . . . . . . . . . . . . 35,000
Edward D. Jones & Co. . . . . . . . . . . . . . . . . . 35,000
Legg Mason Wood Walker, Incorporated . . . . . . . . . 35,000
Lehman Brothers Inc. . . . . . . . . . . . . . . . . . 70,000
McDonald & Company Securities, Inc. . . . . . . . . . . 35,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated . . 70,000
J.P. Morgan Securities Inc. . . . . . . . . . . . . . . 70,000
Oppenheimer & Co., Inc. . . . . . . . . . . . . . . . . 70,000
PaineWebber Incorporated . . . . . . . . . . . . . . . 70,000
Piper Jaffray Inc. . . . . . . . . . . . . . . . . . . 35,000
Prudential Securities Incorporated . . . . . . . . . . 70,000
Pryor, McClendon, Counts & Co., Inc. . . . . . . . . . 35,000
Salomon Brothers Inc . . . . . . . . . . . . . . . . . 70,000
SBC Capital Markets Inc. . . . . . . . . . . . . . . . 70,000
Muriel Siebert & Co., Inc. . . . . . . . . . . . . . . 35,000
Smith Barney Inc. . . . . . . . . . . . . . . . . . . . 70,000
Sturdivant & Co., Inc. . . . . . . . . . . . . . . . . 35,000
Tucker Anthony Incorporated . . . . . . . . . . . . . . 35,000
UBS Securities Inc. . . . . . . . . . . . . . . . . . . 70,000
Wheat, First Securities, Inc. . . . . . . . . . . . . . 35,000
Total . . . . . . . . . . . . . . . . . . . . 3,500,000
<PAGE>
