SEC FILE NO.70-8409
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CERTIFICATE PURSUANT TO
RULE 24
OF PARTIAL COMPLETION OF TRANSACTIONS
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
GENERAL PUBLIC UTILITIES CORPORATION<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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In the Matter of )
)
JERSEY CENTRAL POWER & LIGHT COMPANY )
METROPOLITAN EDISON COMPANY )
PENNSYLVANIA ELECTRIC COMPANY )
GENERAL PUBLIC UTILITIES CORPORATION )
)
SEC File No. 70-8409 )
)
(Public Utility Holding )
Company Act of 1935) )
----------------------------------------X
To the Members of the Securities and Exchange Commission:
The undersigned, Jersey Central Power & Light Company
("JCP&L"), Metropolitan Edison Company ("Met-Ed") and
Pennsylvania Electric Company ("Penelec") and General Public
Utilities Corporation ("GPU") (collectively, the "GPU Companies")
hereby certify pursuant to Rule 24 of the General Rules and
Regulations under the Public Utility Holding Company Act of 1935,
as amended, that certain of the transactions authorized by the
Commission's Order, dated January 26, 1996, have been carried out
in accordance with the terms and conditions of, and for the
purposes represented by, the Application, as amended, in SEC File
No. 70-8409 as follows:
1. On February 15, 1996, GPU acquired for cash all of
the 2,500 authorized shares of the common stock, par value $20,
of GPU Generation Corporation ("GPUGC") for $20 per share, or an
aggregate consideration of $50,000.
2. On February 29, 1996, GPUGC and the GPU Companies
entered into a Generating Station Operating Agreement under which
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GPUGC has (i) undertaken responsibility for the generation,
maintenance and rehabilitation of all non-nuclear generation
facilities owned and/or operated by JCP&L, Met-Ed and Penelec,
and the design, construction, start-up and testing of any non-
nuclear generation facility which JCP&L, Met-Ed or Penelec, as
the case may be, may need in the future and (ii) assumed the
responsibilities of Penelec and JCP&L under certain operating
agreements under which they operate and maintain certain fossil
fuel and hydroelectric generation facilities each of which is
jointly owned by a GPU Company with one or more unaffiliated
utilities.
3. On February 29, 1996, GPUGC and GPU Service
Corporation ("GPUSC") entered into a Service Agreement under
which GPUSC will perform certain general and administrative
functions and services for GPUGC.
4. The following exhibits are filed herewith in Item
6:
A-1(a) Articles of Incorporation of GPUGC.
A-2(a) By-laws of GPUGC, as amended.
B Generating Station Operating Agreement among
JCP&L, Met-Ed, Penelec and GPUGC, dated March
1, 1996.
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SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE PUBLIC UTILITY
HOLDING COMPANY ACT OF 1935, THE UNDERSIGNED COMPANIES HAVE DULY
CAUSED THIS STATEMENT TO BE SIGNED ON THEIR BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
JERSEY CENTRAL POWER & LIGHT COMPANY
METROPOLITAN EDISON COMPANY
PENNSYLVANIA ELECTRIC COMPANY
GENERAL PUBLIC UTILITIES CORPORATION
By:
T.G. Howson, Vice President
and Treasurer
Date: March 8, 1996<PAGE>
Exhibit A-1(a)
GPU GENERATION CORPORATION
_______________
ARTICLES OF INCORPORATION
I. The name of the Corporation is GPU GENERATION CORPORATION
II. The location and post office address of the registered
office of the Corporation in the Commonwealth of Pennsylvania is:
c/o Pennsylvania Electric Company
1001 Broad Street
Johnstown, Cambria County, Pennsylvania 15907
III. The purposes for which the Corporation is incorporated are
as follows:
A. The engaging in all lawful business for which
corporations may be incorporated under the Pennsylvania Business
Corporation Law of 1988, as amended.
B. Without limiting the generality of the foregoing, the
undertaking of responsibility for the safe operation,
maintenance, repair, rehabilitation, design, construction, start-
up and testing of non-nuclear electric generating stations and
plants used for the production, generation, manufacture,
transmission, transportation, distribution, furnishing and supply
of electricity, on behalf of and by contract with the owners
and/or operators of such stations and plants.
IV. The Corporation is incorporated under the provisions of the
Business Corporation Law of 1988.
V. The term of existence of the Corporation shall be perpetual.
VI. The aggregate number of shares which the Corporation shall
have the authority to issue is two thousand five hundred (2,500)
shares of the par value of $20.00 per share, all of which shall
be designated "Common Shares".
VII. The name and address of the sole incorporator is James R.
Leva, 100 Interpace Parkway, Parsippany, New Jersey 07054.
VIII. The number of directors shall not be less than three nor
more than twelve. The number of directors within said minimum
and maximum limits which shall constitute the Board of Directors
shall be specified in the By-Laws of the Corporation.<PAGE>
IN WITNESS WHEREOF, the Incorporator has hereunto signed
these Articles of Incorporation this 6th day of April, 1994.
______________________________
James R. Leva
Sole Incorporator<PAGE>
<PAGE>
Exhibit 1
Page 1 of 3
ENERGY INITIATIVES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1994
(UNAUDITED)
Operating revenues $ 4,694,914
Operating expenses 8,574,166
Depreciation 369,590
Total 8,943,756
Net operating loss (4,248,842)
Other income and expenses:
Equity in partnership losses (1,014,105)
Interest income, net 503,089
Total other income
and expenses (511,016)
Loss before income taxes (4,759,858)
Income tax benefit (1,623,813)
Net loss (3,136,045)
Accumulated deficit,
beginning of period (12,482,161)
Accumulated deficit, end of period $(15,618,206)<PAGE>
Exhibit 1
Page 2 of 3
ENERGY INITIATIVES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 1994
(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash and temporary investments $ 772,335
Accounts receivable 1,568,700
Interest receivable 216
Income taxes receivable 632,011
Deposits 150
Deferred income taxes 491,751
Other current assets 3,081,086
TOTAL CURRENT ASSETS 6,546,249
OTHER ASSETS
Long term accounts receivable 233,000
Investments other 4,767,367
Investments in securities 15,035,286
Investments in partnerships 78,659,501
Long term receivables from partnerships 2,331,231
Notes receivable from partnerships 3,044,441
Fixed assets, net 430,643
Intangible assets, net 16,633,132
Deferred income taxes 2,006,378
Other noncurrent assets 12,200
TOTAL ASSETS $129,699,428<PAGE>
Exhibit 1
Page 3 of 3
ENERGY INITIATIVES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 1994
(UNAUDITED)
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 2,735,325
Deferred revenues 111,528
Payroll taxes and deductions payable 4,965
Accounts payable-vacation 261,159
TOTAL CURRENT LIABILITIES 3,112,977
LONG TERM LIABILITIES
Long term accounts payable 325,000
Deferred credits 5,842,047
Deferred revenues 2,240,915
STOCKHOLDERS EQUITY 118,178,489
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $129,699,428<PAGE>
Exhibit A-2(a)
GPU GENERATION CORPORATION
By-Laws
(As Amended February 12, 1996)<PAGE>
GPU GENERATION CORPORATION
BY-LAWS
Offices
1.The principal office of the Corporation shall be in
Johnstown, Pennsylvania. The Corporation may also have offices
at such other places as the Board of Directors may from time to
time designate or the business of the Corporation may require.
Seal
2.The corporate seal shall have inscribed thereon the name of
the Corporation, the year of its organization, and the words
"Corporate Seal" and "Pennsylvania". If authorized by the Board
of Directors, the corporate seal may be affixed to any
certificates of stock, bonds, debentures, notes or other
engraved, lithographed or printed instruments, by engraving,
lithographing or printing thereon such seal or a facsimile
thereof, and such seal or facsimile thereof so engraved,
lithographed or printed thereon shall have the same force and
effect, for all purposes, as if such corporate seal had been
affixed thereto by indentation.
Shareholders' Meetings
3.All meetings of shareholders shall be held at the principal
office of the Corporation or at such other place as shall be
stated in the notice of the meeting. Such meetings shall be
presided over by the chief executive officer of the Corporation
or, in his absence, by such other officer as shall have been
designated for the purpose by the Board of Directors, except when
by statute the election of a presiding officer is required.
4.Annual meetings of shareholders shall be held during the
month of May in each year on such day and at such time as shall
be determined by the Board of Directors and specified in the
notice of the meeting. At the annual meeting the shareholders
entitled to vote shall elect by ballot a Board of Directors and
transact such other business as may properly be brought before
the meeting. Prior to any meeting of shareholders at which an
election of directors is to be held, the Board of Directors shall
appoint one judge of election to serve at such meeting. If there
be a failure to appoint a judge or if such judge be absent or
refuse to act or if his office becomes vacant, the shareholders
present at the meeting, by a per capita vote, shall choose
temporary judges of the number required. No director or officer
of the Corporation shall be eligible to appointment or election
as a judge nor shall a person who is a candidate for an office to
be filled at the meeting act as a judge.
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5.Except as otherwise provided by law, or by the Articles of
Incorporation, as amended from time to time, the holders of a
majority of the shares of stock of the Corporation issued and
outstanding and entitled to vote, present in person or by proxy,
shall be requisite for, and shall constitute a quorum at, any
meeting of the shareholders. If, however, the holders of a
majority of such shares of stock shall not be present or
represented by proxy at any such meeting, the shareholders
entitled to vote thereat, present in person or by proxy, shall
have power, by vote of the holders of a majority of the shares of
capital stock present or represented at the meeting, to adjourn
the meeting from time to time without notice other than
announcement at the meeting, until the holders of the amount of
stock requisite to constitute a quorum, as aforesaid, shall be
present in person or by proxy. At any adjourned meeting at which
such quorum shall be present, in person or by proxy, any business
may be transacted which might have been transacted at the meeting
as originally noticed.
6.At each meeting of the shareholders each shareholder having
the right to vote shall be entitled to vote in person or by proxy
appointed by an instrument executed in writing by such
shareholder, or by his duly appointed attorney; but no proxy
shall be valid after the expiration of eleven months from the
date of its execution unless the shareholder executing it shall
have specified therein the length of time it is to continue in
force, which shall be for some specified period not in excess of
three (3) years. Each holder of record of stock having voting
power shall be entitled to one vote for each share of stock
standing in the name of such holder on the stock transfer books
of the Corporation, provided that at all elections of directors
of the Corporation each such holder shall be entitled to as many
votes as shall equal the number of shares of stock such holder is
entitled to vote, multiplied by the number of directors to be
elected, and may cast all such votes for a single director or may
distribute them among the number of directors to be voted for, or
any two or more of them, as such holder may see fit. The vote
for directors, and upon the demand of any shareholder or duly
authorized proxy, the vote upon any question before the meeting,
shall be by ballot. For all elections of directors, the
candidates receiving the highest number of votes from each class
or group of classes, if any, entitled to elect directors
separately up to the number of directors to be elected by the
class or group of classes shall be elected. All other matters
shall be determined by a vote of the holders of a majority of the
shares of the capital stock present or represented at a meeting
and voting on such questions. Shares of capital stock of the
Corporation, belonging to the Corporation or to a corporation
controlled by the Corporation through stock ownership or through
majority representation on the Board of Directors, shall not be
voted.
7.A complete list of the shareholders entitled to vote at any
meeting of shareholders, arranged in alphabetical order, with the
residence of each, and the number of shares held by each, shall
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be prepared by the Secretary and filed in the principal office of
the Corporation at least fifteen days before the meeting, and
shall be open to the examination of any shareholder at all times
prior to such meeting, during the usual hours for business, and
shall be available at the time and place of such meeting and open
to the examination of any shareholder.
8.Special meetings of the shareholders for any purpose or
purposes, unless otherwise prescribed by law or by the Articles
of Incorporation, may be called by the Chairman of the Board of
Directors or by the President or by a majority of the Executive
Committee, and shall be called by the President or Secretary at
the request in writing of holders of record of twenty percent of
the shares of capital stock of the Corporation issued and
outstanding and entitled to vote. Business transacted at all
special meetings of the shareholders shall be confined to the
purposes stated in the call.
9. (a)Notice of every meeting of shareholders, setting
forth the time and the place and briefly the purpose or purposes
thereof, shall be given, not less than ten nor more than fifty
days prior to such meeting, to each shareholder of record (at the
shareholder's address appearing on the stock books of the
Corporation, unless the shareholder shall have filed with the
Secretary of the Corporation a written request that notices
intended for such shareholder be mailed to some other address, in
which case it shall be mailed to the address designated in such
request) as of a date fixed by the Board of Directors pursuant to
Section 41 of the By-Laws. Except as otherwise provided by law,
by the Articles of Incorporation, as amended, or by the By-Laws,
items of business, in addition to those specified in the notice
of meeting, may be transacted at the annual meeting.
(b)Whenever by any provision of law, the vote of
shareholders at a meeting thereof is required or permitted to be
taken in connection with any corporate action, the meeting and
vote of shareholders may be dispensed with, if all the
shareholders who would have been entitled to vote upon the action
if such meeting were held, shall consent in writing prior or
subsequent to such corporate action being taken, and all such
consents shall be filed with the Secretary of the Corporation.
However, this section shall not be construed to alter or modify
any provision of law or of the Articles of Incorporation under
which the written consent of the holders of less than all
outstanding shares is sufficient for corporate action.
Directors
10. The business and affairs of the Corporation shall be
managed under the direction of its Board of Directors, which
shall consist of not less than three nor more than twelve
directors. Each director shall be at least twenty-one years of
age. Directors need not be shareholders of the Corporation.
Directors shall be elected at the annual meeting of shareholders,
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or, if any such election shall not be held, at a shareholders'
meeting called and held in accordance with the provisions of the
Business Corporation Law of the Commonwealth of Pennsylvania.
Each director shall serve until the next annual meeting of
shareholders and thereafter until such director's successor shall
have been elected and shall qualify.
11. In addition to the powers and authority by the By-Laws
expressly conferred upon it, the Board of Directors may exercise
all such powers of the Corporation and do all such lawful acts
and things as are not by law or by the Articles of Incorporation,
as amended, or by the By-Laws directed or required to be
exercised or done by the shareholders.
12. Unless otherwise required by law, in the absence of
fraud no contract or transaction between the Corporation and one
or more of its directors or officers, or between the Corporation
and any domestic or foreign corporation, partnership, firm or
association of any type or kind in which one or more of its
directors or officers are directors or officers or have a
financial or other interest, shall be void or voidable solely for
such reason, or solely because such director or officer is
present at or participates in the meeting of the Board or
committee thereof which authorizes the contract or transaction,
or solely because the votes of such director or directors are
counted for such purposes if:
(a)the material facts as to the relationship or interest
and as to the contract or transaction are disclosed or are
known to the Board of Directors and the Board authorizes
the contract or transaction by the affirmative votes of a
majority of the disinterested directors even though the
disinterested directors are less than a quorum;
(b)the material facts as to such relationship or interest
and as to the contract or transaction are disclosed or are
known to the shareholders entitled to vote thereon and the
contract or transaction is specifically approved in good
faith by vote of those shareholders; or
(c)the contract or transaction is fair as to the
Corporation as of the time it is authorized, approved or
ratified by the Board of Directors or the shareholders.
No director or officer shall be liable to account to the
Corporation for any profit realized by such director or officer
from or through any such contract or transaction of the
Corporation by reason of the interest of such director or officer
as aforesaid in such contract or transaction if such contract or
transaction shall be authorized, approved or ratified as
aforesaid.
No contract or other transaction between the Corporation and
any of its affiliates shall in any case be void or voidable or
-4-<PAGE>
otherwise affected because of the fact that directors or officers
of the Corporation are directors or officers of such affiliate,
nor shall any such director or officer, because of such relation,
be deemed interested in such contract or other transaction under
any of the provisions of this Section 12, nor shall any such
director be liable to account because of such relation. For the
purpose of this Section 12, the term "affiliate" shall mean any
corporation which is an "affiliate" of the Corporation within the
meaning of the Public Utility Holding Company Act of 1935, as
said Act shall at the time be in effect.
Nothing herein shall create liability in any of the events
described in this Section 12 or prevent the authorization,
ratification or approval, in any other manner provided by law, of
any contract or transaction described in this Section 12.
Meetings of the Board of Directors
13. The first meeting of the Board of Directors, for the
purpose of organization, the election of officers, and the
transaction of any other business which may come before the
meeting, shall be held on call of the Chairman within one week
after the annual meeting of shareholders. If the Chairman shall
fail to call such meeting, it may be called by the President or
by any director. Notice of such meeting shall be given in the
manner prescribed for special meetings of the Board of Directors.
14. Regular meetings of the Board of Directors may be held
without notice except for the purpose of taking action on matters
as to which notice is in the By-Laws required to be given, at
such time and place as shall from time to time be designated by
the Board, but in any event at intervals of not more than three
months. Special meetings of the Board of Directors may be called
by the Chairman or by the President or in the absence or
disability of the Chairman and the President, by a Vice
President, or by any two directors, and may be held at the time
and place designated in the call and notice of the meeting.
15. Except as otherwise provided by the By-Laws, any item
or business may be transacted at any meeting of the Board of
Directors, whether or not such item of business shall have been
specified in the notice of meeting. Where notice of any meeting
of the Board of Directors is required to be given by the By-Laws,
the Secretary or other officer performing such duties shall give
notice either personally or by telephone or telegraph or
facsimile transmission at least twenty-four hours before the
meeting, or by mail at least three days before the meeting.
Meetings may be held at any time and place without notice if all
the directors are present or if those not present waive notice in
writing either before or after the meeting.
16. At all meetings of the Board of Directors or a
committee thereof a majority of the entire Board or committee
shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the
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directors present and voting at any meeting at which there is a
quorum shall be the act of the Board of Directors, except as may
be otherwise specifically provided by law or by the Articles of
Incorporation or any amendment thereto or by the By-Laws.
17. Any action required or permitted to be taken by the
Board or any committee of the Board may be taken without a
meeting if, prior or subsequent to such action, all members of
the Board or the committee consent in writing to the adoption of
a resolution authorizing the action. The resolution and the
written consents thereto by the members of the Board or committee
shall be filed with the minutes of the proceedings of the Board
or committee. Any regular or special meeting may be adjourned to
any time or place by a majority of the directors present at the
meeting whether or not a quorum shall be present at such meeting,
and no notice of the adjourned meeting shall be required other
than announcement at the meeting.
Committees
18. The Board of Directors may, by the vote of a majority
of the directors in office, create an Executive Committee,
consisting of two or more members, of whom one shall be the chief
executive officer of the Corporation. The other members of the
Executive Committee shall be designated by the Board of Directors
from their number, shall hold office for such period as the Board
of Directors shall determine and may be removed at any time by
the Board of Directors. When a member of the Executive Committee
ceases to be a director, he shall cease to be a member of the
Executive Committee. The Executive Committee shall have all the
powers specifically granted to it by the By-Laws and, between
meetings of the Board of Directors, may also exercise all the
powers of the Board of Directors; provided, however, that the
Executive Committee shall not have power or authority to (i)
submit to the shareholders any action requiring approval of the
shareholders under the Pennsylvania Business Corporation Law of
1988, (ii) create or fill vacancies on the Board of Directors,
(iii) amend or repeal these By-Laws or adopt new By-Laws, (iv)
amend or repeal any resolution of the Board that by its terms is
amendable or repealable only by the Board, or (v) act on any
matter committed by these By-Laws or by resolution of the Board
to another committee of the Board.
19. The Executive Committee shall cause to be kept regular
minutes of its proceedings, which may be transcribed in the
regular minute book of the Corporation, and all such proceedings
shall be reported to the Board of Directors at its next
succeeding meeting. The action of the Executive Committee shall
be subject to revision or alteration by the Board of Directors,
provided that no rights which, in the absence of such revision or
alteration, third persons would have had shall be affected by
such revision or alteration. A majority of the Executive
Committee shall constitute a quorum at any meeting. The Board of
Directors may by vote of a majority of the total number of
directors provided for in Section 10 of the By-Laws fill any
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vacancies in the Executive Committee. The Executive Committee
shall designate one of its number as Chairman of the Executive
Committee and may, from time to time, prescribe rules and
regulations for the calling and conduct of meetings of the
Committee, and other matters relating to its procedure and the
exercise of its powers.
20. From time to time the Board of Directors may appoint
any other committee or committees for any purpose or purposes,
which committee or committees shall have such powers and such
tenure of office as shall be specified in the resolution of
appointment. The chief executive officer of the Corporation shall
be a member ex officio of all committees of the Board unless
otherwise directed by the Board in respect of any committee or
committees.
Compensation and Reimbursement of Directors
and Members of the Executive Committee
21. Directors, other than salaried officers of the
Corporation or its affiliates, shall receive compensation for
their services as directors at such rate as shall be fixed from
time to time by the Board, and all directors shall be reimbursed
for their reasonable expenses, if any, of attendance at each
regular or special meeting of the Board of Directors.
22. Directors, other than salaried officers of the
Corporation or its affiliates, who are members of any committee
of the Board shall receive compensation for their services as
such members at such rate as shall be fixed from time to time by
the Board, and shall be reimbursed for their reasonable expenses,
if any, in attending meetings of such committee or otherwise
performing their duties as members of such committee.
Officers
23. The officers of the Corporation shall be chosen by vote
of a majority of the directors in office and shall be a
President, one or more Vice Presidents, a Secretary and a
Treasurer, and may include a Chairman, a Comptroller, one or more
Assistant Secretaries, one or more Assistant Treasurers, and one
or more Assistant Comptrollers. If a Chairman shall be chosen,
the Board of Directors shall designate either the Chairman or the
President as chief executive officer of the Corporation. If a
Chairman shall not be chosen, the President shall be the chief
executive officer of the Corporation. The Chairman, if there be
one, and a President who is designated chief executive officer of
the Corporation, shall be chosen from among the directors. A
President who is not chief executive officer of the Corporation
and none of the other officers need be a director. If a
Comptroller shall not be chosen, the Board of Directors shall
designate another officer as principal accounting officer of the
Corporation who in his capacity as such shall have the duties and
responsibilities set forth in Section 33 hereof. Any two offices
may be occupied and the duties thereof may be performed by one
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person, but no officer shall execute, acknowledge or verify any
instrument in the name of the Corporation in more than one
capacity.
24. The salaries and other compensation of the officers
(other than assistant officers) of the Corporation shall be
determined from time to time by the Board of Directors. The
salaries and other compensation of the assistant officers of the
Corporation shall be determined from time to time by the
President.
25. The Board of Directors may appoint such officers and
such representatives or agents as shall be deemed necessary, who
shall hold office for such terms, exercise such powers, perform
such duties, and receive such salaries or other compensation, as
shall be determined from time to time by action of the Board of
Directors.
26. The salary or other compensation of all other employees
shall be fixed by the chief executive officer of the Corporation
or by such other officer as shall be designated for that purpose
by the Board of Directors.
27. The officers of the Corporation shall hold office until
the first meeting of the Board of Directors after the next
succeeding annual meeting of shareholders and until their
respective successors are chosen and qualify. Any officer
elected pursuant to Section 23 of the By-Laws may be removed at
any time, with or without cause, by the vote of a majority of
directors then in office. Any other officer and any
representative, employee or agent of the Corporation may be
removed at any time, with or without cause, by action of the
Board of Directors, or, in the absence of action by the Board of
Directors, by the Executive Committee, or the chief executive
officer of the Corporation, or such other officer as shall have
been designated for that purpose by the chief executive officer
of the Corporation.
The Chairman
28. (a)If a Chairman shall be chosen by the Board of
Directors, such Chairman shall preside at all meetings of the
Board at which such Chairman shall be present.
(b)If a Chairman shall be chosen by the Board of Directors
and is designated by the Board as chief executive officer of the
Corporation, such Chairman
(i)shall have supervision, direction and control of the
conduct of the business of the Corporation, subject,
however, to the control of the Board of Directors and
the Executive Committee, if there be one;
(ii)may sign in the name and on behalf of the
Corporation any and all contracts, agreements or other
-8-<PAGE>
instruments pertaining to matters which arise in the
ordinary course of business of the Corporation, and,
when authorized by the Board of Directors or the
Executive Committee, if there be one, may sign in the
name and on behalf of
the Corporation any and all contracts, agreements or
other instruments of any nature pertaining to the
business of the Corporation;
(iii)may, unless otherwise directed by the Board of
Directors pursuant to Section 38 of the By-Laws, attend
in person or by substitute or proxy appointed by such
Chairman and act and vote on behalf of the Corporation
at all meetings of the shareholders of any corporation
in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of
such stock;
(iv)shall, whenever it may in the opinion of such
Chairman be necessary or appropriate, prescribe the
duties of officers and employees of the Corporation
whose duties are not otherwise defined; and
(v)shall have such other powers and perform such other
duties as may be prescribed from time to time by law,
by the By-Laws, or by the Board of Directors.
(c) If a Chairman shall be chosen by the Board of
Directors and is not designated by the Board as chief executive
officer of the Corporation, such Chairman
(i)may sign in the name and on behalf of the
Corporation any and all contracts, agreements or other
instruments pertaining to matters which arise in the
ordinary course of business of the Corporation and,
when authorized by the Board of Directors or the
Executive Committee, if there be one, may sign in the
name and on behalf of the Corporation any and all
contracts, agreements or other instruments of any
nature pertaining to the business of the Corporation;
and
(ii)shall have such other powers and perform such other
duties as may be prescribed from time to time by law,
by the By-Laws, or by the Board of Directors.
The President
29. (a)If a Chairman shall not be chosen by the Board of
Directors, the President shall preside at all meetings of the
Board at which such President shall be present.
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(b) If the President shall be designated by the Board of
Directors as chief executive officer of the Corporation, the
President
(i)shall have supervision, direction and control of the
conduct of the business of the Corporation, subject,
however, to the control of the Board of Directors and
the Executive Committee, if there be one;
(ii)may sign in the name and on behalf of the
Corporation any and all contracts, agreements or other
instruments pertaining to matters which arise in the
ordinary course of business of the Corporation, and,
when authorized by the Board of Directors or the
Executive Committee, if there be one, may sign in the
name and on behalf of the Corporation any and all
contracts, agreements or other instruments of any
nature pertaining to the business of the Corporation;
(iii)may, unless otherwise directed by the Board of
Directors pursuant to Section 38 of the By-Laws, attend
in person or by substitute or proxy appointed by such
President and act and vote on behalf of the Corporation
at all meetings of the shareholders of any corporation
in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of
such stock;
(iv)shall, whenever it may in the opinion of such
President be necessary or appropriate, prescribe the
duties of officers and employees of the Corporation
whose duties are not otherwise defined; and
(v)shall have such other powers and perform such other
duties as may be prescribed from time to time by law,
by the By-Laws, or by the Board of Directors.
(c) If the Chairman shall be designated by the Board of
Directors as chief executive officer of the Corporation, the
President,
(i)shall be the chief operating officer of the
Corporation;
(ii)shall have supervision, direction and control of
the conduct of the business of the Corporation, in the
absence or disability of the Chairman, subject,
however, to the control of the Board of Directors and
the Executive Committee, if there be one;
(iii)may sign in the name and on behalf of the
Corporation any and all contracts, agreements or other
instruments pertaining to matters which arise in the
ordinary course of business of the Corporation, and,
when authorized by the Board of Directors or the
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Executive Committee, if there be one, may sign in the
name and on behalf of the Corporation any and all
contracts, agreements or other instruments of any
nature pertaining to the business of the Corporation;
(iv)at the request or in the absence or disability of
the Chairman, may, unless otherwise directed by the
Board of Directors pursuant to Section 38 of the By-
Laws, attend in person or by substitute or proxy
appointed by such President and act and vote on behalf
of the Corporation at all meetings of the shareholders
of any corporation in which the Corporation holds stock
and grant any consent, waiver, or power of attorney in
respect of such stock;
(v)at the request or in the absence or disability of
the Chairman, whenever in the opinion of such
President it may be necessary or appropriate, shall
prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(vi)shall have such other powers and perform such other
duties as may be prescribed from time to time by law,
by the By-Laws, or by the Board of Directors.
Vice President
30. (a)The Vice President shall, in the absence or
disability of the President, if the President has been designated
chief executive officer of the Corporation or if the President is
acting pursuant to the provisions of Subsection 29(c)(ii) of the
By-Laws, have supervision, direction and control of the conduct
of the business of the Corporation, subject, however, to the
control of the Board of Directors and the Executive Committee, if
there be one.
(b) The Vice President may sign in the name of and on
behalf of the Corporation any and all contracts, agreements or
other instruments pertaining to matters which arise in the
ordinary course of business of the Corporation, and, when
authorized by the Board of Directors or the Executive Committee,
if there be one, may sign in the name and on behalf of the
Corporation any and all contracts, agreements or other
instruments of any nature pertaining to the business of the
Corporation except in cases where the signing thereof shall be
expressly delegated by the Board of Directors or the Executive
Committee to some other officer or agent of the Corporation.
(c) The Vice President may, if the President has been
designated chief executive officer of the Corporation or if the
President is acting pursuant to the provisions of Subsection 29
(c) (ii) of the By-Laws, at the request or in the absence or
disability of the President or in case of the failure of the
President to appoint a substitute or proxy as provided in
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Subsections 29 (b) (iii) and 29 (c) (iv) of the By-Laws, unless
otherwise directed by the Board of Directors pursuant to Section
38 of the By-Laws, attend in person or by substitute or proxy
appointed by such Vice President and act and vote on behalf of
the Corporation at all meetings of the shareholders of any
corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock.
(d) The Vice President shall have such other powers and
perform such other duties as may be prescribed from time to time
by law, by the By-Laws, or by the Board of Directors.
(e) If there be more than one Vice President, the Board
of Directors may designate one or more of such Vice Presidents as
an Executive Vice President. The Board of Directors may assign
to such Vice Presidents their respective duties and may, if the
President has been designated chief executive officer of the
Corporation or if the President is acting pursuant to the
provisions of Subsection 29 (c) (ii) of the By-Laws, designate
the order in which the respective Vice Presidents shall have
supervision, direction and control of the business of the
Corporation in the absence or disability of the President.
The Secretary
31. (a)The Secretary shall attend all meetings of the Board
of Directors and all meetings of the shareholders and record all
votes and the minutes of all proceedings in books to be kept for
that purpose; and shall perform like duties for the Executive
Committee and any other committees created by the Board of
Directors.
(b) The Secretary shall give, or cause to be given,
notice of all meetings of the shareholders, the Board of
Directors, or the Executive Committee of which notice is required
to be given by law or by the By-Laws.
(c) The Secretary shall have such other powers and
perform such other duties as may be prescribed from time to time
by law, by the By-Laws, or by the Board of Directors.
(d) Any records kept by the Secretary shall be the
property of the Corporation and shall be restored to the
Corporation in case of the Secretary's death, resignation,
retirement or removal from office.
(e) The Secretary shall be the custodian of the seal of
the Corporation and, pursuant to Section 45 of the By-Laws and in
other instances where the execution of documents on behalf of the
Corporation is authorized by the By-Laws or by the Board of
Directors, may affix the seal to all instruments requiring it and
attest the ensealing and the execution of such instruments.
(f) The Secretary shall have control of the stock
ledger, stock certificate book and all books containing minutes
of any meeting of the shareholders, Board of Directors, or
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Executive Committee or other committee created by the Board of
Directors, and of all formal records and documents relating to
the corporate affairs of the Corporation.
(g) Any Assistant Secretary or Assistant Secretaries
shall assist the Secretary in the performance of the Secretary's
duties, shall exercise the powers and duties of the Secretary at
the request or in the absence or disability of the Secretary, and
shall exercise such other powers and duties as may be prescribed
by the Board of Directors.
The Treasurer
32. (a)The Treasurer shall be responsible for the
safekeeping of the corporate funds and securities of the
Corporation, and shall maintain and keep custody of full and
accurate accounts of receipts and disbursements in books
belonging to the Corporation, and shall deposit all moneys and
other funds of the Corporation in the name and to the credit of
the Corporation, in such depositories as may be designated by the
Board of Directors.
(b) The Treasurer shall disburse the funds of the
Corporation in such manner as may be ordered by the Board of
Directors, taking proper vouchers for such disbursements.
(c) Pursuant to Section 45 of the By-Laws, the Treasurer
may, when authorized by the Board of Directors, affix the seal to
all instruments requiring it and attest the ensealing and the
execution of such instruments.
(d) The Treasurer shall exhibit at all reasonable times
such accounts and records to any director of the Corporation upon
application during business hours at the office of the
Corporation where such accounts and records are kept.
(e) The Treasurer shall render an account of all
transactions as Treasurer at all regular meetings of the Board of
Directors, or whenever the Board may require it, and at such
other times as may be requested by the Board or by any director
of the Corporation.
(f) If required by the Board of Directors, the Treasurer
shall give the Corporation a bond, the premium on which shall be
paid by the Corporation, in such form and amount and with such
surety or sureties as shall be satisfactory to the Board, for the
faithful performance of the duties of the Treasurer's office, and
for the restoration to the Corporation in case of the death,
resignation, retirement or removal from office of the Treasurer,
of all books, papers, vouchers, money and other property of
whatever kind belonging to the Corporation in the possession or
under the control of the Treasurer .
(g) The Treasurer shall perform all duties generally
incident to the office of Treasurer, and shall have other powers
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and duties as from time to time may be prescribed by law, by the
By-Laws, or by the Board of Directors.
(h) Any Assistant Treasurer or Assistant Treasurers
shall assist the Treasurer in the performance of the Treasurer's
duties, shall exercise the powers and duties of the Treasurer at
the request or in the absence or disability of the Treasurer, and
shall exercise such other powers and duties as may be prescribed
by the Board of Directors. If required by the Board of Directors,
any Assistant Treasurer shall give the Corporation a bond, the
premium on which shall be paid by the Corporation, similar to
that which may be required to be given by the Treasurer.
Comptroller
33. (a)The Comptroller of the Corporation shall be the
principal accounting officer of the Corporation and shall be
accountable and report directly to the Board of Directors. If
required by the Board of Directors, the Comptroller shall give
the Corporation a bond, the premium on which shall be paid by the
Corporation, in such form and amount and with such surety or
sureties as shall be satisfactory to the Board, for the faithful
performance of the duties of the Comptroller's office.
(b) The Comptroller shall keep or cause to be kept full
and complete books of account of all operations of the
Corporation and of its assets and liabilities.
(c) The Comptroller shall have custody of all accounting
records of the Corporation other than the record of receipts and
disbursements and those relating to the deposit or custody of
money or securities of the Corporation, which shall be in the
custody of the Treasurer.
(d) The Comptroller shall exhibit at all reasonable
times such books of account and records to any director of the
Corporation upon application during business hours at the office
of the Corporation where such books of account and records are
kept.
(e) The Comptroller shall render reports of the
operations and business and of the condition of the finances of
the Corporation at regular meetings of the Board of Directors,
and at such other times as may be requested by the Board or by
any director of the Corporation, and shall render a full
financial report at the annual meeting of the shareholders, if
called upon to do so.
(f) The Comptroller shall receive and keep custody of
an original copy of each written contract made by or on behalf of
the Corporation.
(g) The Comptroller shall receive periodic reports from
the Treasurer of the Corporation of all receipts and
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disbursements, and shall see that correct vouchers are taken for
all disbursements for any purpose.
(h) The Comptroller shall perform all duties generally
incident to the office of Comptroller, and shall have such other
powers and duties as from time to time may be prescribed by law,
by the By-Laws, or by the Board of Directors.
(i) Any Assistant Comptroller or Assistant Comptrollers
shall assist the Comptroller in the performance of the
Comptroller's duties, shall exercise the powers and duties of the
Comptroller at the request or in the absence or disability of the
Comptroller, and shall exercise such other powers and duties as
may be prescribed by the Board of Directors. If required by the
Board of Directors, any Assistant Comptroller shall give the
Corporation a bond, the premium on which shall be paid by the
Corporation, similar to that which may be required to be given by
the Comptroller.
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Vacancies
34. If the office of any director becomes vacant for any
reason, including vacancies resulting from an increase in the
number of directors, the directors then in office, although less
than a quorum, by a majority vote, may fill such vacancy and each
person so selected shall hold office for the unexpired term in
respect of which such vacancy occurred. If the office of any
officer of the Corporation shall become vacant for any reason,
the Board of Directors, at a meeting, the notice of which shall
have specified the filling of such vacancy as one of its
purposes, may choose a successor who shall hold office for the
unexpired term in respect of which such vacancy occurred.
Pending action by the Board of Directors at such meeting, the
Board of Directors or the Executive Committee may choose a
successor temporarily to serve as an officer of the Corporation.
Resignations
35. An officer or any director of the Corporation may
resign at any time, such resignation to be made in writing and
transmitted to the Secretary. Such resignation shall take effect
from the time of its receipt by the Corporation, unless some
time be fixed in the resignation, and then from that time.
Nothing herein shall be deemed to relieve any officer from
liability for breach of any contract of employment resulting from
any such resignation.
Duties of Officers May be Delegated
36. In case of the absence or disability of any officer of
the Corporation, or for any other reason the Board of Directors
may deem sufficient, the Board, by vote of a majority of
directors then in office, may, notwithstanding any other
provisions of the By-Laws, delegate or assign, for the time
being, the powers or duties, or any of them, of such officer to
any other officer or to any director.
Indemnification of Directors, Officers and Employees
37. (a)A director shall not be personally liable for
monetary damages as such for any action taken, or any failure to
take any action, unless the director has breached or failed to
perform the duties of his or her office under the Pennsylvania
Business Corporation Law of 1988, as amended, and the breach or
failure to perform constitutes self-dealing, willful misconduct
or recklessness. The provisions of this subsection (a) shall not
apply to the responsibility or liability of a director pursuant
to any criminal statute, or the liability of a director for the
payment of taxes pursuant to local, state or Federal law.
(b) The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, whether
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formal or informal, and whether brought by or in the right of the
Corporation, its shareholders or otherwise, by reason of the fact
that such person was a director, officer or employee of the
Corporation (and may indemnify any person who was an agent of the
Corporation), or a person serving at the request of the
Corporation as a director, officer, partner, fiduciary or trustee
of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, to the fullest extent
permitted by law, including without limitation indemnification
against expenses (including attorneys' fees and disbursements),
damages, punitive damages, judgments, penalties, fines and
amounts paid in settlement actually and reasonably incurred by
such person in connection with such proceeding unless the act or
failure to act giving rise to the claim for indemnification is
finally determined by a court to have constituted willful
misconduct or recklessness. If any such person is not entitled
to indemnification in respect of a portion of any liabilities to
which such person may be subject, the Corporation shall
nonetheless indemnify such person to the maximum extent for the
remaining portion of the liabilities.
(c) The Corporation shall pay the expenses (including
attorneys' fees and disbursements) actually and reasonably
incurred in defending a civil or criminal action, suit or
proceeding on behalf of any person entitled to indemnification
under subsection (b) in advance of the final disposition of such
proceeding upon receipt of an undertaking by or on behalf of such
person to repay such amount if it shall ultimately be determined
that such person is not entitled to be indemnified by the
Corporation, and may pay such expenses in advance on behalf of
any agent on receipt of a similar undertaking. The financial
ability of such person to make such repayment shall not be a
prerequisite to the making of an advance.
(d) For purposes of this Section: (i) the Corporation
shall be deemed to have requested an officer, director, employee
or agent to serve as fiduciary with respect to an employee
benefit plan where the performance by such person of duties to
the Corporation also imposes duties on, or otherwise involves
services by, such person as a fiduciary with respect to the plan;
(ii) excise taxes assessed with respect to any transaction with
an employee benefit plan shall be deemed "fines"; and (iii)
action taken or omitted by such person with respect to an
employee benefit plan in the performance of duties for a purpose
reasonably believed to be in the interest of the participants and
beneficiaries of the plan shall be deemed to be for a purpose
which is not opposed to the best interests of the Corporation.
(e) To further effect, satisfy or secure the
indemnification obligations provided herein or otherwise, the
Corporation may maintain insurance, obtain a letter of credit,
act as self-insurer, create a reserve, trust, escrow, cash
collateral or other fund or account, enter into indemnification
agreements, pledge or grant a security interest in any assets or
properties of the Corporation, or use any other mechanism or
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arrangement whatsoever in such amounts, at such costs, and upon
such other terms and conditions as the Board of Directors shall
deem appropriate.
(f) All rights of indemnification under this Section
shall be deemed a contract between the Corporation and the person
entitled to indemnification under this Section pursuant to which
the Corporation and each such person intend to be legally bound.
Any repeal, amendment or modification hereof shall be prospective
only and shall not limit, but may expand, any rights or
obligations in respect of any proceeding whether commenced prior
to or after such change to the extent such proceeding pertains to
actions or failures to act occurring prior to such change.
(g) The indemnification, as authorized by this Section,
shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be
entitled under any statute, agreement, vote of shareholders or
disinterested directors or otherwise, both as to actions in an
official capacity and as to actions in any other capacity while
holding such office. The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section shall
continue as to a person who has ceased to be an officer,
director, employee or agent in respect of matters arising prior
to such time, and shall inure to the benefit of the heirs,
executors and administrators of such person.
Stock of Other Corporations
38. The Board of Directors may authorize any director,
officer or other person on behalf of the Corporation to attend,
act and vote at meetings of the shareholders of any corporation
in which the Corporation shall hold stock, and to exercise
thereat any and all of the rights and powers incident to the
ownership of such stock and to execute waivers of notice of such
meetings and calls therefor.
Certificates of Stock
39. The certificates of stock of the Corporation shall be
numbered and shall be entered in the books of the Corporation as
they are issued. They shall exhibit the holder's name and number
of shares and may include the holder's address. No fractional
shares of stock shall be issued. Certificates of stock shall be
signed by the President or a Vice President and by the Treasurer
or an Assistant Treasurer or the Secretary or an Assistant
Secretary, and shall be sealed with the seal of the Corporation
or a facsimile thereof. Where any certificate of stock is
countersigned by a transfer agent or registrar who is not an
officer or employee of the Corporation, the signatures of any
such President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate may be
facsimiles, engraved or printed. In case any such officer who
has signed or whose facsimile signature has been placed upon a
certificate shall have ceased to be such before such certificate
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of stock is issued, it may be issued by the Corporation with the
same effect as if such officer had not ceased to be such at the
date of its issue.
Transfer of Stock
40. Transfers of stock shall be made on the books of the
Corporation only by the person named in the certificate or by
attorney, lawfully constituted in writing, and upon surrender of
the certificate therefor.
Fixing of Record Date
41. The Board of Directors is hereby authorized to fix a
time, not exceeding fifty (50) days preceding the date of any
meeting of shareholders or the date fixed for the payment of any
dividend or the making of any distribution, or for the delivery
of evidences of rights or evidences of interests arising out of
any change, conversion or exchange of capital stock, as a record
time for the determination of the shareholders entitled to notice
of and to vote at such meeting or entitled to receive any such
dividend, distribution, rights or interests, as the case may be;
and all persons who are holders of record of capital stock at the
time so fixed, and no others, shall be entitled to notice of and
to vote at such meeting, and only shareholders of record at such
time shall be entitled to receive any such notice, dividend,
distribution, rights or interests.
Registered Shareholders
42. The Corporation shall be entitled to treat the holder
of any share or shares of stock as the holder in fact thereof and
accordingly shall not be bound to recognize any equitable or
other claim to, or interest in, such share on the part of any
other person, whether or not it shall have express or other
notice thereof, save as expressly provided by statutes of the
Commonwealth of Pennsylvania.
Lost Certificates
43. Any person claiming a certificate of stock to be lost
or destroyed shall make an affidavit or affirmation of that fact,
whereupon a new certificate may be issued of the same tenor and
for the same number of shares as the one alleged to be lost or
destroyed; provided, however, that the Board of Directors may
require, as a condition to the issuance of a new certificate, the
payment of the reasonable expenses of such issuance or the
furnishing of a bond of indemnity in such form and amount and
with such surety or sureties, or without surety, as the Board of
Directors shall determine, or both the payment of such expenses
and the furnishing of such bond, and may also require the
advertisement of such loss in such manner as the Board of
Directors may prescribe.
Inspection of Books
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44. The Board of Directors may determine whether and to
what extent, and at what time and places and under what
conditions and regulations, the accounts and books of the
Corporation (other than the books required by statute to be open
to the inspection of shareholders), or any of them, shall be open
to the inspection of shareholders, and no shareholder shall have
any right to inspect any account or book or document of the
Corporation, except as such right may be conferred by statutes of
the Commonwealth of Pennsylvania or by the By-Laws or by
resolution of the Board of Directors or of the shareholders.
Checks, Notes, Bonds and Other Instruments
45. (a)All checks or demands for money and notes of the
Corporation shall be signed by such person or persons (who may
but need not be an officer or officers of the Corporation) as the
Board of Directors may from time to time designate, either
directly or through such officers of the Corporation as shall, by
resolution of the Board of Directors, be authorized to designate
such person or persons. If authorized by the Board of Directors,
the signatures of such persons, or any of them, upon any checks
for the payment of money may be made by engraving, lithographing
or printing thereon a facsimile of such signatures, in lieu of
actual signatures, and such facsimile signatures so engraved,
lithographed or printed thereon shall have the same force and
effect as if such persons had actually signed the same.
(b) All bonds, mortgages and other instruments requiring
a seal, when required in connection with matters which arise in
the ordinary course of business or when authorized by the Board
of Directors, shall be executed on behalf of the Corporation by
the President or a Vice President, and the seal of the
Corporation shall be thereupon affixed by the Secretary or an
Assistant Secretary or the Treasurer or an Assistant Treasurer,
who shall, when required, attest the ensealing and execution of
said instrument. If authorized by the Board of Directors, a
facsimile of the seal may be employed and such facsimile of the
seal may be engraved, lithographed or printed and shall have the
same force and effect as an impressed seal. If authorized by the
Board of Directors, the signatures of the President or a Vice
President or the Secretary or an Assistant Secretary or the
Treasurer or an Assistant Treasurer upon any engraved,
lithographed or printed bonds, debentures, notes or other
instruments may be made by engraving, lithographing or printing
thereon a facsimile of such signatures, in lieu of actual
signatures, and such facsimile signatures so engraved,
lithographed or printed thereon shall have the same force and
effect as if such officers had actually signed the same. In case
any officer who has signed, or whose facsimile signature appears
on, any such bonds, debentures, notes or other instruments shall
cease to be such officer before such bonds, debentures, notes or
other instruments shall have been delivered by the Corporation,
such bonds, debentures, notes or other instruments may
nevertheless be adopted by the Corporation and be issued and
delivered as though the person who signed the same, or whose
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facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
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Receipts for Securities
46. All receipts for stocks, bonds or other securities by
the Corporation shall be signed by the Treasurer or an Assistant
Treasurer, or by such other person or persons as the Board of
Directors or Executive Committee shall designate.
Fiscal Year
47. The fiscal year shall begin the first day of January in
each year.
Dividends
48. (a)Dividends in the form of cash or securities, upon
the capital stock of the Corporation, to the extent permitted by
law, may be declared by the Board of Directors at any regular or
special meeting.
(b) The Board of Directors shall have power to fix and
determine, and from time to time vary, the amount to be reserved
as working capital; to determine whether any, and if any, what
part of any, surplus of the Corporation shall be declared as
dividends; to determine the date or dates for the declaration and
payment or distribution of dividends; and, before payment of any
dividend or the making of any distribution, to set aside out of
the surplus of the Corporation such amount or amounts as the
Board of Directors from time to time, in its absolute discretion,
may think proper as a reserve fund to meet contingencies, or for
equalizing dividends, or for such other purpose as it shall deem
to be in the interests of the Corporation.
Notices
49. (a)Whenever under the provisions of the By-Laws notice
is required to be given to any director, officer or shareholder,
it shall not be construed to require personal notice, but, except
as otherwise specifically provided, such notice may be given in
writing, by first class or express mail or by depositing a copy
of the same in a post office, letter box or mail chute,
maintained by the United States Postal Service or Courier Service
for delivery to that person, postage prepaid, addressed to such
shareholder, officer or director, at his or her address as the
same appears on the books of the Corporation.
(b) A shareholder, director or officer may waive in
writing any notice required to be given to him or her by law or
by the By-Laws.
Participation in Meetings by Telephone
50. At any meeting of the Shareholders, Board of Directors
or the Executive Committee or any other committee designated by
the Board of Directors, one or more directors or shareholders may
participate in such meeting in lieu of attendance in person by
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means of the conference telephone or similar communications
equipment by means of which all persons participating in the
meeting will be able to hear and speak.
Oath of Judges of Election
51. The judges of election appointed to act at any meeting
of the shareholders shall, before entering upon the discharge of
their duties, be sworn faithfully to execute the duties of judge
at such meeting with strict impartiality and according to the
best of their ability.
Amendments
52. The By-Laws may be altered or amended by the
affirmative vote of the holders of a majority of the capital
stock represented and entitled to vote at a meeting of the
shareholders duly held, provided that the notice of such meeting
shall have included notice of such proposed amendment. The
By-Laws may also be altered or amended by the affirmative vote of
a majority of directors then in office at a meeting of the Board
of Directors, the notice of which shall have included notice of
the proposed amendment.
In the event of the adoption, amendment, or repeal of any
By-Law by the Board of Directors pursuant to this Section, there
shall be set forth in the notice of the next meeting of
shareholders for the election of directors the By-Law so adopted,
amended or repealed together with a concise statement of the
changes made. By the affirmative vote of the holders of a
majority of the capital stock represented and entitled to vote at
such meeting, the By-Laws may, without further notice, be altered
or amended by amending or repealing such action by the Board of
Directors.
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Exhibit B
GENERATING STATION
OPERATING AGREEMENT
among
JERSEY CENTRAL POWER & LIGHT COMPANY
and
METROPOLITAN EDISON COMPANY
and
PENNSYLVANIA ELECTRIC COMPANY
and
GPU GENERATION CORPORATION
This AGREEMENT made and entered into this _____ day of
___________, 1996 by and among Jersey Central Power & Light
Company ("JCP&L"), Metropolitan Edison Company ("Met-Ed"),
Pennsylvania Electric Company ("Penelec") and GPU Generation
Corporation ("GPUGC").
W I T N E S S E T H:
WHEREAS, JCP&L, Met-Ed, Penelec and GPUGC are each a wholly-
owned subsidiary of General Public Utilities Corporation ("GPU"),
a registered holding company under the Public Utility Holding
Company Act of 1935 (the "1935 Act"); and
-1-<PAGE>
WHEREAS, JCP&L, Met-Ed and Penelec (hereinafter referred to
collectively as "Owners" and individually as an "Owner") each
owns and operates certain fossil fuel, hydro-electric (1) and
pumped storage generation stations, plants and other related
generation facilities and may, in the future, own additional such
facilities, which are set forth and generally described on
Schedule 1 hereto, as it may from time to time be hereafter
amended or supplemented without the necessity of an amendment to
this Agreement (individually a "Generation Facility" or
collectively, the "Generation Facilities"); and
WHEREAS, Penelec and JCP&L each has heretofore entered into
agreements with other utilities under which it has agreed to
operate and maintain certain fossil fuel, hydro-electric or
pumped storage (non-nuclear) generation facilities for the mutual
benefit of the co-owners, as the same may be amended or
supplemented from time to time (such agreements being
collectively called, the "Joint Operating Agreements"); and
________________________
(1) One such hydro-electric generation station, York Haven, is
owned by York Haven Power Company ("YHP"), a wholly-owned
subsidiary of Met-Ed. This Agreement is executed by Met-
Ed on its own behalf and on behalf of YHP.
-2-<PAGE>
WHEREAS, each Owner believes that in order to more
efficiently and economically provide for the operation,
maintenance, repair, and rehabilitation of its respective
Generation Facilities and of the facilities subject to the Joint
Operating Agreements, and for the construction of new or
additional generation facilities on its behalf if, in the future,
it deems that it is necessary or appropriate to do so, all such
activities should be conducted and coordinated on the Owners'
behalf by a single, separate organization; and
WHEREAS, each Owner now desires that GPUGC, which has been
organized for such purposes, undertake the operation,
maintenance, repair and rehabilitation of its Generation
Facilities, provide for the construction of any new or additional
non-nuclear generation facilities which an Owner may request in
the future, and assume the obligations of Penelec and JCP&L under
the Joint Operating Agreements, subject in each case to the
receipt of any necessary regulatory approvals and the consents or
agreements of the owners of the facilities subject to the Joint
Operating Agreements.
NOW THEREFORE, in consideration of these premises, the
parties, intending to be legally bound, do hereby agree as
follows:
ARTICLE 1
Services to be Provided
-3-<PAGE>
1.1 GPUGC, consistent with such written guidelines as may be
jointly developed with the Owners, shall provide and be
responsible for (i) the operation and maintenance of the
Generation Facilities in a safe and reliable manner in
accordance with all applicable licenses, permits and
requirements of federal, state and local regulatory
agencies, (ii) the generation of power and energy at the
Generation Facilities to the credit of and for the benefit
of the Owner of each such Generation Facility as
economically as is reasonably practicable, (iii) the
repair and rehabilitation of the Generation Facilities as
may, from time to time, be necessary, appropriate or
reasonably practicable and advisable and (iv) as and to
the extent deemed by an Owner to be necessary or
appropriate, the construction of new or additional non-
nuclear generation facilities for such Owner. GPUGC also
shall make such further modifications of and additions to
and retirements from the Generation Facilities as shall be
consistent with such operation, maintenance, repair and
rehabilitation. Such services and construction may be
provided by GPUGC through its own personnel or in part, by
others under contractual or other arrangements, including
the use of an Owner's personnel under the direction and
supervision of GPUGC.
1.2 In furtherance of the foregoing, each Owner authorizes
GPUGC, among other things, to:
-4-<PAGE>
(a) Select, hire, control and discharge personnel, who,
unless otherwise agreed, shall be employees solely of
GPUGC, and select and retain the services of
contractors and consultants.
(b) As and when requested by an Owner, arrange for the
procurement, on behalf of such Owner, of requisite fuel
for such Owner's Generation Facilities and for the
transportation and storage thereof.
(c) Arrange for the purchase on behalf of each Owner of
repair, modification, rehabilitation, operation,
maintenance and construction materials, services and
supplies as necessary for such Owner's Generation
Facilities.
(d) Design, construct, startup and test 1) modifications of
and additions to the Generation Facilities and 2) new
or additional non-nuclear generation facilities for
each Owner upon such Owner's request.
(e) Determine, establish and maintain inventory levels of
material, supplies, parts and equipment for each of the
Generation Facilities.
(f) Keep each Owner informed in a reasonable manner
concerning repair, modification, rehabilitation,
operation and maintenance activities and additions to
and retirements from such Owner's Generation
Facilities.
(g) Prepare, or arrange for the preparation of annual
budgets and forecasts of operation and maintenance
expenses, including budgets and forecasts for the costs
-5-<PAGE>
of repair, modification and rehabilitation, capital
expenditures and plant retirements relating to
Generation Facilities, in accordance with normal and
customary procedures, to be submitted to each Owner for
approval with respect to its Generation Facilities.
The approval of such budgets shall be required before
action may be taken thereunder, provided that work
required to prevent hazardous conditions or substantial
reduction in generation may be undertaken prior to such
approval with prompt notification thereof given to each
Owner. Such budgets and forecasts shall be revised
from time to time to reflect material changes in
circumstances.
(h) Perform any services and take any action on behalf of
an Owner, related to the repair, modification,
rehabilitation, operation, maintenance, renewals,
replacements, additions and retirements pertaining to
the Generation Facilities as may be necessary or
appropriate to comply with any applicable statutes,
rules, regulations, guidelines or similar criteria, and
any provisions or conditions of construction permits
and operating licenses or similar authorizations
granted or that may be hereafter granted in connection
with the Generation Facilities and as such permits,
licenses or other authorizations may hereafter or
thereafter be amended.
(i) In its capacity as operator of each of the Generation
Facilities and as agent for the Owner thereof, provide
-6-<PAGE>
communications to, and receive communications from, any
governmental agency having jurisdiction with respect to
any aspect of the operation, maintenance,
rehabilitation, repair and modification of such
Generation Facility and, in such capacities, represent
(or engage others to represent) each Owner with respect
thereto.
(j) Perform or, if deemed desirable by GPUGC, contract on
behalf of each Owner with others, for the repair,
modification, rehabilitation, maintenance, renewal and
replacement required to place, keep and maintain such
Owner's Generation Facilities in good and efficient
operating condition, to protect the properties on which
such Generation Facilities are located, to conduct
research and development with respect to non-nuclear
generation and to disburse or receive funds in
connection therewith. Such work and contracts relating
thereto shall be subject to normal and customary GPUGC
review and approval procedures.
(k) Perform any additional services pertaining to the
Generation Facilities to which each respective Owner
and GPUGC shall have mutually agreed.
(l) Arrange for 1) the maintenance, in accordance with
normal and customary accounting procedures, of such
necessary books of record, books of account and
memoranda of all transactions and 2) the provision of
such reports to the Owners with respect thereto as each
Owner shall desire to meet its own accounting and
-7-<PAGE>
statistical requirements and to conform to the
applicable lawful rules, regulations and requirements
of all regulatory bodies having jurisdiction over each
Owner. The operating costs incurred and capital
expenditures made for each of the Generation Facilities
shall be accumulated in a separate set of accounts.
(m) Provide or arrange for the provision of such other data
or information with respect to each of the Generation
Facilities as may be reasonably requested by the Owner
from time to time.
1.3 Matters and questions arising in connection with the
operation, maintenance, rehabilitation, repair, or
modification of a Generation Facility which are not within
the scope of the authority delegated to GPUGC under this
Agreement and which are not specifically provided for in
this Agreement shall be jointly determined from time to
time by the Owner of such Generation Facility and GPUGC.
1.4 The costs for services provided by GPUGC pursuant to the
terms, conditions and provisions of this Agreement shall
be paid to GPUGC as provided in Article 3 hereof.
-8-<PAGE>
ARTICLE 2
Operation of Generation Facilities
2.1 In order that the safe operation of the Generation
Facilities is assured, the Owners shall not effect any
operating or physical changes to their respective
transmission and distribution facilities which may affect
the safe operation of the Generation Facilities without
prior consultation with and the concurrence of GPUGC.
2.2 Each Generation Facility shall be operated in accordance
with good utility practice and pursuant to an operating
plan developed and updated regularly by GPUGC and the
Owner thereof and in accordance with each Owner's
obligations, if any, under the Pennsylvania-New Jersey-
Maryland ("PJM") Interconnection Agreement to which JCP&L,
Met-Ed and Penelec are signatories and in accordance with
the "GPU Three Party Agreement" between and among JCP&L,
Met-Ed and Penelec or other applicable power pooling
agreements or arrangements, as such obligations may
presently exist or may hereafter be modified from time to
time, including the obligations, if any, of each Owner to
maintain the design integrity of each Generation Facility
under the requirements of the MidAtlantic Area Council
("MAAC") and the National Electric Reliability Council
("NERC").
-9-<PAGE>
2.3 The point of interconnection between any Generation
Facility and the Owner's transmission system and the
extent of GPUGC'S operational responsibility therefor
shall be determined from time to time by each of the
respective Owners of the Generation Facilities and GPUGC.
ARTICLE 3
Working Capital Accounts
3.1 GPUGC shall arrange for a working capital account ("the
Working Capital Account") to be established for each
Owner, from which GPUGC shall make payments for all costs
incurred in providing its services and in discharging its
responsibil-ities hereunder. Each Owner shall fund its
Working Capital Account by providing or transferring funds
promptly on receipt of telephone or other notice or
direction from or on behalf of GPUGC of such Owner's
obligation therefor.
3.2 Upon termination of this Agreement, as hereinafter
provided, any residual unexpended balance in each Working
Capital Account after payment of the costs actually
incurred, and reasonable commitments therefor, as set
forth in Section 3.1 hereof shall be credited to the Owner
which contributed to such Working Capital Account.
ARTICLE 4
Charges, Financial Statements and Billings
-10-<PAGE>
4.1 GPUGC shall arrange for the prompt reporting of the
following information by written statements issued
quarterly to the Owners:
(a) The costs of operation, maintenance, repair,
rehabilitation and modification of each of the
Generation Facilities, and the cost of any plant
additions and retirements including applicable cost of
removal and salvage, all to be accounted for on an
accrual basis and classified as required to meet
GPUGC's obligations under Section 1.2(l) above.
(b) A summary statement of the operation of the Working
Capital Account during the quarter, showing beginning
balance, receipts, from whom received, disbursements,
to whom made, the purpose thereof, and closing balance.
4.2 All of the services and materials provided or rendered
hereunder to an Owner by GPUGC shall be charged to an
Owner at the actual cost thereof. Direct charges shall be
made for services and materials whenever a direct
allocation of such costs to a particular Owner or
Generation Facility is practicable. The costs incurred or
accrued from all sources during each calendar quarter in
operating, maintaining, repairing, rehabilitating,
modifying, and making additions to and retirements from
the Generation Facilities shall become liabilities when
incurred or accrued and shall be borne by the respective
Owners thereof. All such costs shall be determined in
accordance with sound accounting practices, and shall
-11-<PAGE>
include reasonable and appropriate indirect costs
including overheads. The determination of all other costs
and the allocation thereof are set forth in Schedule 2
hereto. Schedule 2 may, from time to time, be modified
or changed by mutual agreement of GPUGC and the Owners
without the necessity of an amendment to this Agreement,
provided that in each instance all materials and services
provided or rendered hereunder shall be at actual cost
thereof, fairly and equitably allocated, and that all such
modifications or changes shall otherwise be in accordance
with the requirements of the 1935 Act and the applicable
rules, regulations and orders thereunder.
4.3 It is the intent of each Owner that so far as possible
each Owner shall separately report, file returns with
respect to, be responsible for and pay all real property,
franchise, business or other taxes, except payroll and
sales or use taxes, arising out of or relating to its
respective ownership of the Generation Facilities, and
that such taxes shall be separately levied and assessed
against each such Owner. However, to the extent that any
such taxes may be levied on or assessed against any or all
of the Generation Facilities, or their operation, or GPUGC
or any Owner in such a manner as, in the opinion of the
Owner, to make impossible or inequitable the carrying out
of said intent, then such taxes shall be deemed a part of
the costs of operating and maintaining such Generation
Facility or Facilities and shall be apportioned among each
-12-<PAGE>
Owner under this Agreement in accordance with such Owner's
ownership thereof.
4.4 Each Owner shall have the right, during the term of this
Agreement and thereafter as long as the books, records and
memoranda referred to in Section 1.2(l) shall be
preserved, to inspect all such items and to make
reasonable audits thereof at its own cost as it may deem
necessary to protect its interests.
4.5 In the event any Owner shall question any statement
rendered by GPUGC in accordance with the provisions of
Section 4.1 hereof, such Owner shall nevertheless promptly
pay amounts called for by GPUGC under Section 3.1 hereof
but such payment shall not be deemed to prevent such Owner
from claiming an adjustment of any statement rendered.
-13-<PAGE>
ARTICLE 5
Compliance with Provisions of Permits
and Requirements of Governmental Agencies
5.1 Each Owner and GPUGC shall cooperate in taking whatever
action may be necessary to comply with the terms and
provisions of all permits and licenses for its Generation
Facilities and with all applicable lawful requirements of
any federal, state or local agency or regulatory body
having jurisdiction in or over its Generation Facilities,
including the rules, regulations and orders of the Federal
Energy Regulatory Commission ("FERC"), or its successor,
and any FERC license for any such Generation Facility.
Notwithstanding anything to the contrary contained herein,
each Owner, its successors and assigns, hereby reserves
the right, with or without the prior approval of GPUGC, to
perform any and all acts required by any rule, regulation
or order of FERC or its successor regarding any FERC
licensed Generation Facility..
ARTICLE 6
Damage to Persons or Property; Penalties; Fines
6.1 Since GPUGC is undertaking its responsibilities hereunder
(i) at cost and (ii) in order to assist each Owner in
meeting its responsibilities with respect to its
Generation Facilities, the following provisions shall be
-14-<PAGE>
applicable to loss or damage to the property of any or all
the parties hereto (including Generation Facilities
property) or of third parties, or injuries to or loss of
life by any person, including employees of the parties
hereto, and to penalties or fines assessed with respect to
the Generation Facilities:
(a) Each Owner and GPUGC shall procure and maintain such
physical damage and loss, public liability, workers'
compensation and other insurance as it may deem
appropriate with respect to all losses, damages,
liability and claims arising out of each Owner's
ownership of its Generation Facilities and GPUGC's
operation thereof and the provision of services
hereunder. In the alternative upon concurrence of each
party hereto, the Owner and GPUGC shall jointly procure
and maintain such insurance and the premium costs
thereof shall be Generation Facilities costs under
Section 4.2. All such insurance policies shall identify
GPUGC, each respective Owner and, if applicable, the
mortgage indenture trustee, as additional insureds
thereunder as their interests may appear, and shall
contain a waiver of subrogation clause in favor of the
other parties hereto to the extent of the applicable
limits of such policies.
(b) Claims cognizable under workers' compensation acts or
temporary disability benefits laws or any other
benefits under workers' compensation or analogous
statutes and the expenses of defending or disposing of
-15-<PAGE>
the same, attributable to the ownership or operation of
the Generation Facilities, and which are not covered in
full by insurance procured in accordance with the
preceding paragraph shall, if attributable to
particular Generation Facilities and to the extent not
covered by such insurance, be treated as Generation
Facilities costs under Section 4.2.
(c) All losses, damages, expenses, penalties, liabilities,
fines and claims (including those in respect of
property damage and personal injury) asserted by third
parties and the expenses of defending or disposing of
the same, attributable to the ownership or operation of
the Generation Facilities and which are not covered in
full by insurance procured in accordance with the
second preceding paragraph shall, if attributable to
particular Generation Facilities and to the extent not
covered by such insurance, be treated as Generation
Facilities costs under Section 4.2.
(d) Each of the parties hereto hereby expressly waives,
relinquishes and releases any claim or right it may
have to recover from any of the other parties hereto
for any losses, damages, penalties, liabilities, fines,
claims or expenses (including damage to property of the
Generation Facilities) for any cause including the
negligence of any of the other parties hereto, and its
or their employees and agents, in connection with the
operation, maintenance, repair, rehabilitation, and
-16-<PAGE>
modification of the Generation Facilities and the
provision of any services hereunder.
-17-<PAGE>
ARTICLE 7
Miscellaneous
7.1 Nothing in this Agreement shall be deemed to create or
constitute a partnership, joint venture or association
among the parties hereto or any of them, the sole purpose
of this Agreement being limited to providing for the
orderly and efficient operation, maintenance, repair,
modification, rehabilitation, renewal, replacement,
additions and construction of the Generation Facilities.
7.2 Each Owner hereby designates its President as its
Representative, who shall receive notices and
communications from GPUGC under the provisions of this
Agreement and who shall send to the designated
Representative of GPUGC all notices and communications
under the provisions of this Agreement.
7.3 GPUGC hereby designates its President as the GPUGC
Representative, who shall receive notices and
communications from each Owner's Representative under the
provisions of this Agreement and who shall send to each
Owner's Representative all notices and communications
concerning the provisions of this Agreement.
7.4 Each Owner shall determine the basis and method it will
use for purposes of depreciation and other matters where
investment in Generation Facilities property is relevant.
-18-<PAGE>
7.5 In performing services under this Agreement on behalf of
each Owner, GPUGC shall act as an independent contractor
responsible for the result to be attained, consistent with
such guidelines as may be jointly developed with such
Owner.
7.6 To the extent that any Owner may, from time to time,
provide goods or services to GPUGC, GPUGC shall pay for
such goods and services at such providing Owner's cost
determined as herein provided, which payments shall
thereupon be treated as Generation Facilities costs under
Section 4.2. With the agreement of GPUGC, any Owner may,
from time to time, provide goods or services to another
Owner's Generation Facilities and GPUGC shall pay for such
goods and services as set forth in the preceding sentence
of this paragraph.
-19-<PAGE>
ARTICLE 8
Effective Date and Termination
8.1 Subject to any applicable rules and regulations and
associated approvals of any regulatory authority, this
Agreement shall become effective as of the date first
above written and shall remain in full force and effect
unless and until terminated.
8.2 This Agreement may be terminated by any Owner , with
respect to such Owner and to the Generation Facilities
owned by such Owner, upon reasonable written notice to the
other parties hereto.
ARTICLE 9
Successors and Assigns
9.1 This Agreement and all of the terms and conditions hereof
shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and
assigns, provided, however, that neither this Agreement
nor any of GPUGC's obligations hereunder shall be
assignable by GPUGC, in whole or in part, without the
express written consent of each affected Owner. Any
mortgage indenture trustee which shall foreclose on
substantially all of the electric utility properties of
any Owner may, at such trustee's own election, be deemed
to bea successor andassign ofsaid Ownerunder thisAgreement.
-20-<PAGE>
ARTICLE 10
Governing Law
10.1 This Agreement shall be construed in accordance with, and
shall be governed by, the laws of Commonwealth of
Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered as of the day and year
first above written.
JERSEY CENTRAL POWER & LIGHT COMPANY
By__________________________________
D. Baldassari, President
PENNSYLVANIA ELECTRIC COMPANY, and
METROPOLITAN EDISON COMPANY, for itself and for and
on behalf of York Haven Power Company.
By__________________________________
F. D. Hafer, President
GPU GENERATION CORPORATION
By__________________________________
R. L. Wise, President
-21-<PAGE>
SCHEDULE 1
GPU SYSTEM NON-NUCLEAR GENERATION FACILITIES
Jersey Central
Fossil-Fueled
Sayreville (Steam/CTs)
Gilbert (Steam/CC/CTs)
Glen Gardner (CTs)
Forked River (CTs)
Werner (Steam CTs)
Keystone (undivided 16.67% interest)
Pumped Storage
Yards Creek (undivided 50% interest)
Met-Ed
Fossil-Fueled
Portland
Titus
Shawnee (CT)
Hunterstown (CTs)
Hamilton (CT)
Mountain (CTs)
Ortanna (CT)
Portland (CT)
Titus (CT)
Tolna (CTs)
Conemaugh (undivided 16.45% interest)
Hydro-electric
York Haven*
Penelec
Fossil-Fueled
Homer City (undivided 50% interest)
Shawville
Seward
Warren
Benton
Wayne (CT)
Warren (CT)
Hydro-electric
Piney
Deep Creek
Pumped Storage
Seneca (undivided 20% interest)
_______________________
* York Haven hydro-electric generating station is owned by York
Haven Power Company, a wholly-owned subsidiary of Met-Ed.<PAGE>
SCHEDULE 2
Determination of Cost of Service
and Allocation Thereof
Cost of service will be determined in accordance with the
Public Utility Holding Company Act of 1935 and the rules and
regulations and orders thereunder, and will include all costs of
doing business incurred by GPUGC.
Records will be maintained by each Department and Division of
GPUGC in order to accumulate all costs of doing business and to
determine the cost of service. These costs will include wages
and salaries of employees and related expenses such as insurance,
taxes, pensions and other employee welfare expenses, and rent or
other applicable costs of facility utilization, including but not
limited to light, heat, telephone, supplies and other
housekeeping costs. In addition, records will be maintained of
general administrative expenses, which will include the costs of
operating GPUGC as a corporate entity.
Where appropriate, charges for services of personnel rendered
to a particular Generation Facility and related expenses and non-
personnel expenses (e.g., use of automotive equipment, etc.)
relating to a particular Generation Facility will be billed
directly to the Owner of such Generation Facility ("Direct
Charges"). Direct Charges will include the charges for services
of GPUGC personnel assigned exclusively to the Generation
Facilities.<PAGE>
In general, expenses not directly attributable to a
particular Generation Facility ("Indirect Charges") will be
allocated among the Owners in the same proportion as the Direct
Charges are allocated among the Owners pursuant to the preceding
paragraph.
All other costs will be fairly and equitably allocated in
accordance with Rules 90 and 91 of the Public Utility Holding
Company Act of 1935. Calculations under these allocation
formulae will be reviewed periodically and revised as appropriate
to fully allocate all costs by each year-end.
Charges for services will be determined, where appropriate,
from the time records of employees (other than some secretaries,
clerical and similar employees, the cost of whose services will
be treated as a part of general administrative expenses).
Records of such related expenses and general administrative
expenses will be maintained and subjected to periodic review.
Out-of-pocket expenses which are incurred for an Owner will
be billed at cost. Charges for non-personnel expenses, such as
for use of automobiles not assigned exclusively to the Generation
Facilities, will normally be computed on the basis of costs per
hour.<PAGE>
