<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM U5S
ANNUAL REPORT
For the Year Ended December 31, 1998
Filed pursuant to the Public Utility Holding Company Act of 1935
by
GPU, INC. (File No. 30-126)
300 Madison Avenue, Morristown, New Jersey 07962-1911
<PAGE>
GPU, INC.
FORM U5S
ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Item
No. Title Page
---- ------------------------------------------------ ----
<S> <C>
1. System Companies and Investments Therein 1-5
2. Acquisitions or Sales of Utility Assets 6
3. Issue, Sale, Pledge, Guarantee or Assumption
of System Securities 7-9
4. Acquisition, Redemption or Retirement of
System Securities 10-12
5. Investments in Securities of Nonsystem Companies 13
6. Officers and Directors 14-26
7. Contributions and Public Relations 27-28
8. Service, Sales and Construction Contracts 29-32
9. Wholesale Generators and Foreign Utility Companies 33-53
10. Financial Statements and Exhibits:
Consolidating Financial Statements,
Schedules and Notes 54-68
----------------------------------
Exhibits 69-107
--------
Signature Page 108
</TABLE>
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
Number of Common Shares
or Principal Amount % of (a) Issuer Owner's
Name of Company Owned Voting Power Book Value Book Value
- ------------------------------------------ ---------------------- ------------ ---------- ----------
<S> <C> <C> <C> <C>
GPU, Inc. (GPU):
Jersey Central Power & Light Company
(JCP&L)(b) 15,371,270 shs. 100% $1,557,073,248 $1,557,073,248
JCP&L Preferred Capital, Inc. 100 shs. 100 16,944,521 16,944,521
JCP&L Capital L.P. (i) 100 3,866,079 3,866,079
Metropolitan Edison Company
(Met-Ed)(b)(c)(x) 859,500 shs. 100 687,059,485 687,059,485
York Haven Power Company 500 shs. 100 17,512,472 17,512,472
Met-Ed Preferred Capital, Inc. 100 shs. 100 13,572,967 13,572,967
Met-Ed Capital L.P. (i) 100 3,092,899 3,092,899
Pennsylvania Electric Company
(Penelec)(b)(c)(x) 5,290,596 shs. 100 767,305,124 767,305,124
Nineveh Water Company 5 shs. 100 1,536,396 1,536,396
Waverly Electric Light & Power Company 600 shs. 100 60,000 15,000
Penelec Preferred Capital, Inc. 100 shs. 100 14,253,004 14,253,004
Penelec Capital L.P. (i) 100 3,247,524 3,247,524
GPU Service, Inc. (GPUS) (d) 5,000 shs. 100 (3,883,068) (3,883,068)
GPU Nuclear, Inc. (GPUN) (e) 2,500 shs. 100 50,000 50,000
GPU Generation, Inc. (Genco) 2,500 shs. 100 (166,340) (166,340)
GPU Advanced Resources, Inc. (GPU AR) (v) 100 shs. 100 88,913 88,913
GPU Telcom Services, Inc. (GPU Telcom)
(s) 100 shs. 100 5,063,503 5,063,503
GPU International, Inc. (GPUI) (f) 100 shs. 100 143,873,682 132,946,248
Elmwood Energy Corporation (f) 10 shs. 100 11,155,646 11,155,646
Prime Energy Limited Partnership (f) (j) 50 22,399,840 11,234,456
Camchino Energy Corporation (f) 100 shs. 100 2,616,627 2,616,625
OLS Power Limited Partnership (f) (j)(w) 1 (5,077,301) -
OLS Acquisition Corporation (f) 100 shs. 100 (4,965,396) (4,965,396)
OLS Energy - Chino (f) 1,000 shs. 100 (1,056,595) (1,056,595)
OLS Energy - Camarillo (f) 1,000 shs. 100 (4,241,407) (4,241,407)
Geddes II Corporation (g) 100 shs. 100 - -
Geddes Cogeneration Corporation (f)(g) 100 shs. 100 22,279,598 19,381,138
Onondaga Cogeneration Limited
Partnership (f)(g) (i) 100 (11,839,812) 11,394,874
EI Selkirk, Inc. (f) 1,000 shs. 100 25,919,636 25,919,636
Selkirk Cogeneration Partners Limited
Partnership (f) (g) (n) 19 (46,810,489) 9,040,049
EI Canada Holding Limited (g) 1,000 shs. 100 (101,021) (101,021)
EI Services Canada Limited (g) 1,000 shs. 100 (91,117) (94,923)
</TABLE>
1
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENT THEREIN AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
Number of Common Shares
or Principal Amount % of (a) Issuer Owner's
Name of Company Owned Voting Power Book Value Book Value
- -------------------------------------------------------- ----------------------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
NCP Energy, Inc. (f) 1,000 shs. 100 8,720,988 8,720,988
Syracuse Orange Partners L.P. (f) (p) 5 21,692,098 (179,939)
Project Orange Associates L.P. (f) (q) 4 16,507,613 21,746,061
NCP Lake Power Inc. (f) 1,000 shs. 100 139,086 139,086
NCP Gem, Inc. (f) 1,000 shs. 100 3,376,737 3,376,737
Lake Investment, L.P. (f) (l) 100 442,645 438,216
Lake Cogen, Ltd. (f) (m) 50 16,796,035 9,024,225
GPUI Lake Holdings, Inc. (Inactive) 100 shs. 100 100 100
GPUI Holdings Inc. (g)(Inactive) 100 shs. 100 100 100
NCP Pasco, Inc. (f) 1,000 shs. 100 13,396,484 13,396,484
NCP Dade Power, Inc. (f) 1,000 shs. 100 434,703 434,703
Dade Investment, L.P. (f) (l) 100 14,788,016 14,788,016
Pasco Cogen, Ltd. (f) (j) 50 28,514,554 15,127,619
NCP Houston Power Inc. (f) 100 100 7,722,032 7,722,032
NCP Perry Inc. (f) 100 100 10,735,469 10,735,469
Mid Georgia Cogeneration L.P. (f) (j) 50 36,623,578 18,910,217
NCP New York Inc. (f) 1,000 100 - -
EI Fuels Corporation 100 100 - -
EI Services, Inc. 100 100 100 100
GPU Solar, Inc. (t) 50 50 132,843 166,447
NCP Ada Power, Inc. (f) (Inactive) 1,000 shs. 100 273,554 273,554
NCP Commerce Power, Inc. (f) 1,000 shs. 100 - -
Umatilla Groves, Inc. (f) (Inactive) 1,000 shs. 100 - -
NCP Brooklyn Power, Inc. 1,000 shs. 100 - -
Armstrong Energy Corporation (f) (Inactive) 100 shs. 100 - -
AEC/REF-Fuel, Limited Partnership (f) (Inactive) (k) 100 - -
GPU Power, Inc. (GPU Power) (g) 1,000 shs. 100 98,641,773 98,619,165
Guaracachi America, Inc. (g) 100 shs. 100 35,480,058 35,480,058
Empresa Guaracachi S.A. (g) 822,779 shs. 50 88,550,017 51,087,609
EI Barranquilla, Inc. (g) 100 shs. 100 27,368,027 27,368,027
Termobarranquilla S.A. (g) 420,592 shs. 26 113,719,000 29,956,188
Barranquilla Lease Holding, Inc. (g) 100 shs. 100 85,082 85,082
Los Amigos Leasing Company, Ltd. (g) 12,000 shs. 100 (3,891,474) (4,064,892)
EI International (g) 100 shs. 100 123,641 123,641
GPUI Colombia, Ltda. (g) 100 shs. 100 29,843 29,843
</TABLE>
2
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENT THEREIN AS OF DECEMBER 31, 1998
(Continued):
<TABLE>
<CAPTION>
Number of Common Shares
or Principal Amount % of (a) Issuer Owner's
Name of Company Owned Voting Power Book Value Book Value
- ------------------------------------------------------- ------------------------ ------------ -------------- --------------
<S> <C> <C> <C> <C>
GPU Power Philippines, Inc. (g) 100 shs. 100 100 100
Magellan Utilities Development Corporation (g) 17,264 shs. 13 - -
GPU International Asia, Inc. (g) 100 shs. 100 (230,227) (231,166)
GPU Power Ireland, Inc. (g) 100 shs. 100 - -
Hanover Energy Corporation (g) (Inactive) 100 shs. 100 - -
EI Power (China) II, Inc. (g) (Inactive) 100 shs. 100 - -
Nanjing Power Partners, L.P. (g) (Inactive) (j) 50 - -
EI Power (China) III, Inc. (g) (Inactive) 100 shs. 100 - -
Zhuang He Power Partners, L.P. (g) (Inactive) (j) 50 - -
Austin Cogeneration Corporation (g)(l) 100 shs. 100 - -
Austin Cogeneration Partners, L.P.(g) (l) 100 - -
International Power Advisors, Inc. (g) (Inactive) 100 shs. 100 108,433 108,433
GPU Capital, Inc. (GPU Capital) (v) 100 shs. 100 56,134,022 347,135,290
GPU Electric, Inc. (GPU Electric) 100 shs. 100 318,096,393 56,254,027
GPU Brasil, Inc. 100 shs. 100 - -
GPU do Brasil, Ltda 1,000 shs. 100 - -
GPU Sao Paulo, SA 1,000 shs. 100 - -
GPU Argentina Holdings, Inc. 100 shs. 100 - -
GPU Australia Holdings, Inc. (h) 100 shs. 100 91,363,730 91,363,730
GPU GasNet Pty Ltd. 100 shs. 100 - -
GPU GasNet Tradings Pty Ltd. 100 shs. 100 - -
Victoria Electric Holdings, Inc. 100 shs. 100 18,679,874 18,679,874
Victoria Electric, Inc. (h) 100 shs. 100 140,840,559 140,963,954
Austran Holdings, Inc. 100 shs. 100 233,335,437 233,335,437
GPU PowerNet Pty Ltd. (h) 10,000,000 shs. 100 2,227,638 2,213,124
Austran Investment, Pty Ltd. (u) 100 1,178,667,875 1,178,669,750
GPU PowerNet Investments, Pty Ltd. (u) 100 385,746,560 196,730,697
GPU International Australia Pty Ltd. 10,000,000 shs. 100 125,846 125,846
EI UK Holdings, Inc. 100 shs. 100 215,589,473 215,589,473
Avon Energy Partners Holdings 660,000 shs. 50 1,117,800,000 575,619,519
Avon Energy Partners plc 660,000 shs. 100 2,495,200,000 2,527,300,000
Midlands Electricity plc (h) 392,572,556 shs. 100 2,527,000,000 2,494,900,000
Midlands Power International Ltd. 60,000,000 shs. 100 - -
</TABLE>
3
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENT THEREIN AS OF DECEMBER 31, 1998
(Continued):
Notes: (a) Sets forth the percentage of voting securities held directly or
indirectly by GPU, Inc.
(b) The business of these electric utility subsidiaries consists
primarily of the generation, transmission, distribution and sale
of electricity.
These utility subsidiaries collectively own all of the common
stock of Saxton Nuclear Experimental Corporation, a Pennsylvania
nonprofit corporation organized for nuclear experimental
purposes which is now inactive. The carrying value of the
owners' investment has been written down to a nominal value.
(c) Met-Ed and Penelec are exempt as holding companies under Section
3(a) and Rule 2 of the Public Utility Holding Company Act of
1935 (the Act).
(d) Provides corporate services to the electric utility
subsidiaries.
(e) Operates, maintains and manages the nuclear units of the
electric utility subsidiaries.
(f) These subsidiaries are independent power producers, which
participate in some or all aspects of promoting, developing,
financing, constructing, owning, managing and operating
nonutility qualifying facilities.
(g) These subsidiaries are exempt wholesale generators (EWG) under
the provisions of Section 32 of the Act. These subsidiaries
participate in some or all aspects of promoting, developing,
financing, constructing, owning, managing and operating
generation facilities, both domestically and in foreign
countries, the electric energy from which is sold exclusively at
wholesale.
(h) These subsidiaries are foreign utility companies (FUCO) under
the provisions of Section 33 of the Act. These subsidiaries
participate in some or all aspects of promoting, developing,
financing, constructing, owning, managing and operating
generation, transmission and distribution facilities in foreign
countries.
(i) A 100% General Partnership interest.
(j) A 1% General Partnership and a 49% Limited Partnership interest.
(k) A 50% General Partnership interest.
(l) A 1% General Partnership and a 99% Limited Partnership interest.
(m) A 1% General Partnership and a 48.9% Limited Partnership
interest.
4
<PAGE>
ITEM 1. SYSTEM COMPANIES AND INVESTMENT THEREIN AS OF DECEMBER 31, 1998
(Continued):
(n) A 13.55% preferred equity interest and a 19% common equity
interest.
(o) A 75% General Partnership interest.
(p) A 5% Limited Partnership interest.
(q) A 4% Limited Partnership interest.
(r) GPU Advanced Resources, Inc. lines of business include energy
services and retail energy sales.
(s) GPU Telcom is an exempt telecommunications company that is
involved in telecommunications infrastructure.
(t) GPU Solar, L.L.C. was merged with and into GPU Solar, Inc., a
Delaware corporation on March 26, 1998.
(u) These subsidiaries are 100% owned trusts.
(v) On October 9, 1998, GPU formed a new subsidiary, GPU Capital,
Inc., a Delaware Corporation and the parent company of GPU
Electric, Inc. which will develop, own, operate and fund the
acquisition of transmission and distribution systems outside the
United States.
(w) A 1% General Partnership interest.
(x) In 1998, Met-Ed formed Met-Ed Preferred Capital II, Inc., Met-Ed
Capital II, L.P. and Met-Ed Capital Trust and Penelec formed
Penelec Preferred Capital II, Inc., Penelec Capital II, L.P. and
Penelec Capital Trust for the purpose of issuing trust preferred
securities. There were no issuances in 1998.
5
<PAGE>
ITEM 2. ACQUISITIONS OR SALES OF UTILITY ASSETS
None.
6
<PAGE>
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES:
<TABLE>
<CAPTION>
Principal Amount
or Stated Value
Name of Company -------------------------
Name of Issuer Issuing, Selling, Pledged,
and Pledging, Guaranteeing Issued Guaranteed Date of Commission
Title of Issue or Assuming Securities and Sold or Assumed Transaction Proceeds Authorization
(1) (2) (3) (4) (5) (6) (7)
- ---------------------- ---------------------- -------------- ---------- ----------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jersey Central Power & Light Company:
- ------------------------------------
Performance Guarantees JCP&L $ 8,339,000 (a) various n/a Rule 45
==========
</TABLE>
Notes: (a) Represents unused letters of credit for workers compensation
insurance ($8,302,000), and miscellaneous surety bonds ($37,000).
7
<PAGE>
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES
(Continued):
<TABLE>
<CAPTION>
Principal Amount
or Stated Value
Name of Company -----------------------------
Name of Issuer Issuing, Selling, Pledged,
and Pledging, Guaranteeing Issued Guaranteed Date of Commission
Title of Issue or Assuming Securities and Sold or Assumed Transaction Proceeds Authorization
(1) (2) (3) (4) (5) (6) (7)
- ------------------- ---------------------- -------------- ---------- ----------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Metropolitan Edison Company:
- ---------------------------
Performance Guarantees Met-Ed $ 8,098,100(a) various n/a Rule 45
============
</TABLE>
Notes: (a) Represents unused letters of credit for workers compensation
insurance ($815,000), a surety bond relating to motor vehicles
($4,000,000), and miscellaneous surety bonds for various purposes
($3,283,100).
8
<PAGE>
ITEM 3. ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES
(Continued):
<TABLE>
<CAPTION>
Principal Amount
or Stated Value
Name of Company -----------------------------
Name of Issuer Issuing, Selling, Pledged,
and Pledging, Guaranteeing Issued Guaranteed Date of Commission
Title of Issue or Assuming Securities and Sold or Assumed Transaction Proceeds Authorization
(1) (2) (3) (4) (5) (6) (7)
- ------------------- ---------------------- -------------- ---------- ----------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Pennsylvania Electric Company:
- --------------------------------
Performance Guarantees Penelec $ 25,576,766(a) various n/a Rule 45
===========
</TABLE>
Notes: (a) Represents unused letters of credit for workers compensation
insurance ($2,784,000), a surety bond relating to motor vehicles
($1,000,000), and miscellaneous letters of credit and surety bonds
for various purposes ($21,792,766).
9
<PAGE>
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES
<TABLE>
<CAPTION>
Name of Company Acquiring Authorization
Name of Issuer or Retiring Securities Consideration Disposition or Exemption
- -------------- ------------------------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
JCP&L:
Cumulative Preferred Stock JCP&L $ 15,000,000 Redeemed Rule 42
===========
Met-Ed:
None in 1998
Penelec:
First Mortgage Bonds Penelec $ 30,249,375 Retired Rule 42
===========
</TABLE>
NOTE: See pages 11 to 13 for a detailed description of the above transactions.
10
<PAGE>
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES (Continued):
<TABLE>
<CAPTION>
Principal
Name of Company Amount or Stated Value
---------------------------------------------
Acquiring,
Name of Issuer Redeeming or
and Retiring Redeemed Date of Commission
Title of Issue Securities Acquired and Retired Transaction Consideration Authorization
(1) (2) (3) (4) (5) (6) (7)
- --------------------------- ---------------- ----------- -------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Jersey Central Power &
Light Company
Cumulative Preferred Stock:
8.48% Series I JCP&L $10,000,000 05-01-98 $ 10,000,000(a) Rule 42
7.52% Series K JCP&L 5,000,000 06-01-98 5,000,000(b) Rule 42
-------------- ------------
$15,000,000 $ 15,000,000
============== ============
</TABLE>
Notes: (a) 8.48% Series I, $10,000,000 (stated value $100 per share) (100,000
shares), were redeemed on May 1, 1998 pursuant to mandatory and
optional sinking fund provisions at a cost of $10,000,000.
(b) 7.52% Series K, $5,000,000 (stated value $100 per share) (50,000
shares), were redeemed on June 1, 1998 pursuant to mandatory and
optional sinking fund provisions at a cost of $5,000,000.
11
<PAGE>
ITEM 4. ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES (Continued):
<TABLE>
<CAPTION>
Principal
Name of Issuer Name of Company Amount or Stated Value
--------------------------------------
and Acquiring, Redeeming or Redeemed Date of Commission
Title of Issue Retiring Securities Acquired and Retired Transaction Consideration Authorization
(1) (2) (3) (4) (5) (6) (7)
- ---------------------------- ----------------------- -------- ------------ ----------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Pennsylvania Electric
Company
First Mortgage Bonds:
7.875% Series, due 1998 Penelec $30,000,000 02-09-98 $ 30,249,375(a) Rule 42
============
</TABLE>
Notes: (a) All $30,000,000 p.a., 7.875% Series D, due February 9, 1998 were
retired on February 9, 1998 pursuant to the Supplemental Indenture
dated June 1, 1993, at a cost of $30,000,000 plus $249,375 accrued
interest.
12
<PAGE>
ITEM 5. INVESTMENTS IN SECURITIES OF NONSYSTEM COMPANIES AS OF DECEMBER 31,
1998
<TABLE>
<CAPTION>
Equity Securities Nature of Owner's
--------------------------------
Name of Issuer Security Owned Shares Owned % of Voting Power Business Book Value
- -------------------- ------------------- ------------- ------------------ ---------------------- -----------
<S> <C> <C> <C> <C> <C>
Develop, manufacture
and market
Ballard Generation Common stationary fuel
Systems Inc. Stock 1,490,301 (1) 7.41% cell power system $14,029,601
Develop, manufacture
Ballard Power Common share and market fuel cells
Systems Inc. purchase warrant - - and related systems 97,000
Limited Partnership Investment
EnviroTech Interest - 9.90% company 1,822,079
Waterford
Development Common
Corporation Stock 50 6.25% (2) 5,000
Greater Reading Limited
Development Partnership
Partnership Interest - 5.58% (3) 63,495
</TABLE>
(1) Includes 490,300 nonvoting shares.
(2) Participation loans to development corporations to assist in the expansion
and development of industrial and commercial activities by providing
financial assistance to small, emerging businesses.
(3) A nonprofit business that provides loans to development corporations to
assist in the development of commercial real estate and multi-unit homes in
the downtown Reading, Pennsylvania area.
13
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
------------------------------------------------------------------
GPU GPU GPU GPU GPU GPU
GPU INT'L POWER Capital (H) GPUS GPUN GENCO AR TELCOM
------ ----- ----- ------- ----- ---- ---- ----- --- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
F. D. Hafer (A) (N) CH-P-D CH-D CH-D CH-D CH-P-D CB-D CH-D CH-D CH-D
-------------------------------------------------------------------------
T. H. Black
New Canaan, CT D
-------------------------------------------------------------------------
T. B. Hagen
Custom Engineering Company, Erie, PA D
-------------------------------------------------------------------------
H. F. Henderson, Jr.
H. F. Henderson Ind., W. Caldwell, NJ D
-------------------------------------------------------------------------
J. M. Pietruski
Texas Biotechnology Corp., Houston, TX D
-------------------------------------------------------------------------
C. A. Rein
Metropolitan Property and Casualty Ins.
Co., Warwick, RI D
-------------------------------------------------------------------------
P. R. Roedel
Reading, PA D
-------------------------------------------------------------------------
B. S. Townsend
Dorset, England D
-------------------------------------------------------------------------
C. A. H. Trost
Potomac, MD D D
-------------------------------------------------------------------------
Dr. P. K. Woolf
Princeton, NJ D
-------------------------------------------------------------------------
S. K. Cepeda (A) AS AS AS
-------------------------------------------------------------------------
J. G. Graham (A) (J) EVP
-------------------------------------------------------------------------
T. G. Howson (B) VP-T VP-T VP-T VP-T VP-T VP-T
-------------------------------------------------------------------------
I. H. Jolles (A) (K) SVP D D D EVP-D VP VP
-------------------------------------------------------------------------
B. L. Levy (A) (I) (U) SVP D D P-D EVP-D VP P-D
-------------------------------------------------------------------------
P.E. Maricondo (B) (T) VP-C VP-C
-------------------------------------------------------------------------
</TABLE>
14
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WHICH CONNECTED
------------------------------------------------------------------------
YORK
HAVEN NINEVEH WAVERLY
POWER WATER ELEC.
JCP&L (L) MET-ED PENELEC (M) CO. CO. CO. SAXTON
----- --- ------ ------- ----- ------ ----- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
F. D. Hafer (A) (N) CB-D CB-D CB-D D
-------------------------------------------------------------------------
T. H. Black
New Canaan, CT
-------------------------------------------------------------------------
T. B. Hagen
Custom Engineering, Erie, PA
-------------------------------------------------------------------------
H. F. Henderson, Jr.
H. F. Henderson Ind., W. Caldwell, NJ
-------------------------------------------------------------------------
J. M. Pietruski
Texas Biotechnology Corp., Houston, TX
-------------------------------------------------------------------------
C. A. Rein
Metropolitan Property and Casualty Ins.
Co., Warwick, RI
-------------------------------------------------------------------------
P. R. Roedel
Reading, PA
-------------------------------------------------------------------------
B. S. Townsend
Dorset, England
-------------------------------------------------------------------------
C. A. H. Trost
Potomac, MD
-------------------------------------------------------------------------
Dr. P. K. Woolf
Princeton, NJ
-------------------------------------------------------------------------
S. K. Cepeda (A)
-------------------------------------------------------------------------
J. G. Graham (A) (J)
-------------------------------------------------------------------------
T. G. Howson (B) VP-T VP-T VP-T VP-T VP-T T T-D T
-------------------------------------------------------------------------
I. H. Jolles (A) (K) VP VP VP
-------------------------------------------------------------------------
B. L. Levy (A) (I) (U) VP VP VP
-------------------------------------------------------------------------
P.E.Maricondo (B) (T)
-------------------------------------------------------------------------
</TABLE>
15
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
GPU GPU GPU GPU GPU GPU
GPU INT'L POWER CAPITAL (H) GPUS GPUN GENCO AR TELCOM
---- ----- ----- ------- ---- ----- ---- ----- -- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
M. A. Nalewako (A) S S AS S
-----------------------------------------------------------------------------------------
S. H. Somich (B) AT AT AT AT
------------------------------------------------------------------------------------------
D. Baldassari (E) (Q) D D D-P
------------------------------------------------------------------------------------------
R. L. Wise (F) (R) P-D P-D P-D P-D
-----------------------------------------------------------------------------------------
G. E. Persson
Business Dynamics Assoc.,
Lakewood NJ
------------------------------------------------------------------------------------------
S. C. Van Ness
Herbert, Van Ness, Cayci
& Goodwell
Princeton, NJ
------------------------------------------------------------------------------------------
S. B. Wiley
Wiley, Malehorn & Sirota,
Morristown, NJ
------------------------------------------------------------------------------------------
P. R. Chatman (B) AC AC
------------------------------------------------------------------------------------------
C. B. Snyder (A) (P) EVP-D D
------------------------------------------------------------------------------------------
D. C. Brauer (A) VP
------------------------------------------------------------------------------------------
C. Brooks (E) (S) VP
-----------------------------------------------------------------------------------------
D. J. Howe (E) (S) VP
------------------------------------------------------------------------------------------
C. A. Mascari (E) (S) (T) ------------------------------------------------------------------------------------------
D. W. Myers (E) (S) (T) VP-C
------------------------------------------------------------------------------------------
G. R. Repko (E) (S) VP
------------------------------------------------------------------------------------------
C. A. Stinger
GPUS, Washington, DC VP
-----------------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
----------------------------------------------------
YORK
HAVEN NINEVEH WAVERLY
POWER WATER ELEC.
JCP&L (L) MET-ED PENELEC (M) CO. CO. CO. SAXTON
----- --- ------ ------- --- ----- ------- ----- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
M. A. Nalewako (A) AS AS AS AS AS
---------------------------------------------------------------------------------
S. H. Somich (B) AT VP AT AT
---------------------------------------------------------------------------------
D. Baldassari (E) (Q) P-D P-D P-D P-D P-D D P-D P-D CB-P-D
---------------------------------------------------------------------------------
R. L. Wise (F) (R)
---------------------------------------------------------------------------------
G. E. Persson
Business Dynamics Assoc.,
Lakewood NJ D
---------------------------------------------------------------------------------
S. C. Van Ness
Herbert, Van Ness, Cayci & Goodell
Princeton, NJ D
---------------------------------------------------------------------------------
S. B. Wiley
Wiley, Malehorn & Sirota,
Morristown, NJ D
---------------------------------------------------------------------------------
P. R. Chatman (B) AC AC AC
---------------------------------------------------------------------------------
C. B. Snyder (A) (P) D D D D
---------------------------------------------------------------------------------
D. C. Brauer (A)
---------------------------------------------------------------------------------
C. Brooks (E) (S) VP VP VP
---------------------------------------------------------------------------------
D. J. Howe (E) (S) VP VP VP
---------------------------------------------------------------------------------
C. A. Mascari (E) (S) (T) VP VP VP D
---------------------------------------------------------------------------------
D. W. Myers (E) (S) (T) VP-C-D VP-C-D VP-C-D C-D C
---------------------------------------------------------------------------------
G. R. Repko (E) (S) VP VP VP D VP-D
--------------------------------------------------------------------------------
C. A. Stinger
GPUS, Washington, DC
---------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
-------------------------------------------------------------------------------------
GPU GPU GPU GPU GPU GPU GPU
GPU INT'L POWER CAPITAL (H) GPUS GPUN GENCO AR TELCOM
----- ------- ------- --------- ----- ------ ------ ------- ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
R. S. Zechman (E) (S) VP
--------------------------------------------------------------------------------------
T. G. Broughton (D) P-D
--------------------------------------------------------------------------------------
J. D. Townsend
Sedona, AZ D
--------------------------------------------------------------------------------------
W. A. Wilson
ICC Technologies, Hatboro, PA D
--------------------------------------------------------------------------------------
J. Langenbach
TMI-1, Middletown, PA VP-D
--------------------------------------------------------------------------------------
M. B. Roche
O.C. NS, Forked River, NJ VP
--------------------------------------------------------------------------------------
D. Furlong (D) AS- C
--------------------------------------------------------------------------------------
M. E. Gramlich (A)
--------------------------------------------------------------------------------------
S. L. Guibord (A) S S S
--------------------------------------------------------------------------------------
R. S. Renzi (D) AS
--------------------------------------------------------------------------------------
A. H. Rone (D) VP
--------------------------------------------------------------------------------------
J. F. Wilson (D) VP
--------------------------------------------------------------------------------------
S. Barish-Straus (D) S S S S
--------------------------------------------------------------------------------------
F. Dominguez (D) VP-C VP-C VP-C VP-C
--------------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
-------------------------------------------------------------------------------------
YORK
HAVEN NINEVEH WAVERLY
POWER WATER ELEC.
JCP&L (L) MET-ED PENELEC (M) CO. CO. CO. SAXTON
------- ----- -------- --------- ----- ------ --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
R. S. Zechman (E) (S) VP VP VP VP-D D
-------------------------------------------------------------------------------------
T. G. Broughton (D) D
-------------------------------------------------------------------------------------
J. D. Townsend
Sedona, AZ
-------------------------------------------------------------------------------------
W. A. Wilson
ICC Technologies, Philadelphia, PA
-------------------------------------------------------------------------------------
J. Langenbach
TMI-1, Middletown, PA
-------------------------------------------------------------------------------------
M. B. Roche
O.C. NS, Forked River, NJ
-------------------------------------------------------------------------------------
D. Furlong (D)
-------------------------------------------------------------------------------------
M. E. Gramlich (A) AS AS AS
-------------------------------------------------------------------------------------
S. L. Guibord (A) S S S S S S S S S
-------------------------------------------------------------------------------------
R. S. Renzi (D)
-------------------------------------------------------------------------------------
A. H. Rone (D) EVP-D
-------------------------------------------------------------------------------------
J. F. Wilson (D)
-------------------------------------------------------------------------------------
S. Barish-Straus (D)
-------------------------------------------------------------------------------------
F. Dominguez (D)
-------------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
-------------------------------------------------------------------------
GPU GPU GPU GPU GPU GPU
GPU INT'L POWER CAPITAL (H) GPUS GPUN GENCO AR TELCOM
--- ------- ------ -------- ---- ----- ----- ----- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
M. Freddo (D) AC AC AC AC
-------------------------------------------------------------------------
R. J. Guy (D) VP VP VP
-------------------------------------------------------------------------
R. P. Lantzy (F) SVP SVP
-------------------------------------------------------------------------
B. Matheson (D) VP VP VP
-------------------------------------------------------------------------
W. C. Matthews (E) AS AS
-------------------------------------------------------------------------
J. A. McTear (D) VP VP VP VP
-------------------------------------------------------------------------
L. Tellez (D) VP VP VP VP
-------------------------------------------------------------------------
S-I
W. H. Thomson (D) AS AS AS AS-D
-------------------------------------------------------------------------
R. S. Plenderleith (G) (U) C
-------------------------------------------------------------------------
R. J. Toole (F) VP-D
-------------------------------------------------------------------------
R. J. Vodzack (F) (O) AC
-------------------------------------------------------------------------
E. F. Beglin (D)
-------------------------------------------------------------------------
G. A. Kuehn (D)
-------------------------------------------------------------------------
L. A. Lenhart (C)
-------------------------------------------------------------------------
D. Weaver (E)
-------------------------------------------------------------------------
</TABLE>
20
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAMES OF GPU COMPANIES WITH WHICH CONNECTED
----------------------------------------------------------------------------
YORK
HAVEN NINEVEH WAVERLY
POWER WATER ELEC.
JCP&L (L) MET-ED PENELEC (M) CO. CO. CO. SAXTON
----- --- ------ ------- --- ----- ------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
M. Freddo (D)
----------------------------------------------------------------------------
R. J. Guy (D)
----------------------------------------------------------------------------
R. P. Lantzy (F)
----------------------------------------------------------------------------
B. Matheson (D)
----------------------------------------------------------------------------
W. C. Matthews (E) AS AS AS AS
----------------------------------------------------------------------------
J. A. McTear (D)
----------------------------------------------------------------------------
L. Tellez (D)
----------------------------------------------------------------------------
W. H. Thomson (D)
----------------------------------------------------------------------------
R. S. Plenderleith (G) (U)
----------------------------------------------------------------------------
R. J. Toole (F) VP VP VP P-D
----------------------------------------------------------------------------
R. J. Vodzack (F) (O)
----------------------------------------------------------------------------
E. F. Beglin (E) C
----------------------------------------------------------------------------
G. A. Kuehn (D) VP
----------------------------------------------------------------------------
L. A. Lenhart (C) T
----------------------------------------------------------------------------
D. Weaver (E) VP
----------------------------------------------------------------------------
</TABLE>
21
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
(A) Address is 300 Madison Avenue, Morristown, NJ.
(B) Address is 310 Madison Avenue, Morristown, NJ.
(C) Address is Rt. 183 & Van Reed Road, Reading, PA.
(D) Address is One Upper Pond Road, Parsippany, NJ.
(E) Address is 2800 Pottsville Pike, Muhlenberg Township, PA.
(F) Address is 1001 Broad Street, Johnstown, PA.
(G) Address is 2675 Morgantown Road, Reading, PA.
(H) Includes some or all of the following the following GPU International Group
companies: Elmwood Energy Corporation, Camchino Energy Corporation, OLS
Acquisition Corporation, OLS Energy - Berkeley, OLS Energy - Chino, OLS
Energy - Camarillo, Armstrong Energy Corporation, Geddes Cogeneration
Corporation, NCP Energy, Inc., NCP Lake Power, Inc., NCP Gem, Inc.,
Umatilla Groves, Inc., NCP Dade Power, Inc., NCP Pasco, Inc., NCP Brooklyn
Power, Inc., NCP Commerce Power, Inc., NCP Houston Power, Inc., NCP Perry,
Inc., NCP New York, Inc., EI Selkirk, Inc., EI Canada Holding, Ltd., EI
Brooklyn Power, Ltd., EI Services Canada, Ltd., EI Brooklyn Investments,
Ltd., EI International, EI Fuels Corporation, EI Services, Inc., GPU
International Asia, Inc., GPU Power Ireland, Inc., Hanover Energy
Corporation, EI Power (China), Inc., EI Power (China) I, Inc., EI Power
(China) II, Inc., EI Power (China) III, Inc., Guaracachi America, Inc., EI
Barranquilla, Inc., Barranquilla Lease Holding, Inc., Los Amigos Leasing
Company, Ltd., Austin Cogeneration Corporation, International Power
Advisors, Inc., GPU Power Philippines, Inc., Victoria Electric Holdings,
Inc., and Victoria Electric, Inc., GPU Electric, Inc., GPU Australia
Holdings, Inc., Austran Holdings, Inc., EI UK Holdings, Inc., Avon Energy
Partners Holdings, and Avon Energy Partners plc.
(I) B. L. Levy is also Director of GPU International Australia Pty Ltd., EI UK
Holdings, Inc., Avon Energy Partners Holdings, Avon Energy Partners plc,
Midlands Electricity plc. and GPU PowerNet Pty. Ltd.
(J) J. G. Graham resigned from all GPU Companies effective December 15, 1998,
except as an Executive Vice President of GPUS until his anticipated
retirement on April 30, 1999 and is also a Director of Avon Energy Partners
Holdings, Avon Energy Partners plc, Midlands Electricity plc., and Empresa
Guaracachi, S.A.
(K) I. H. Jolles is also Alternate Director of Midlands Electricity, plc., Avon
Energy Parnters Holdings, Avon Energy Partners, plc. and GPU PowerNet Pty.
Ltd.
(L) Includes the following companies: JCP&L Preferred Capital, Inc., and JCP&L
Capital, L.P.
22
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
(M) Includes the following companies: Met-Ed Preferred Capital, Inc., Met-Ed
Capital, L.P., Penelec Preferred Capital, Inc., and Penelec Capital, L.P.
(N) F. D. Hafer is also a Director of Avon Energy Partners Holdings, Avon
Energy Partners plc., Midlands Electricity plc., GPU PowerNet Pty. Ltd. and
Midlands Power International Ltd.
(O) R. J. Vodzack is also Chief Accounting Officer of GPU Genco.
(P) C. Snyder is also a Director of GPU PowerNet Pty Ltd.
(Q) Effective January 1, 1999, D. Baldassari became President - Operations
Division, and Director of GPUS.
(R) Effective January 1, 1999, R. L. Wise became President - Fossil Generation
and Director of GPUS.
(S) Effective January 1, 1999, also assumed the position of Vice President of
GPUS.
(T) D. W. Myers resigned from all positions with GPU Companies effective April
9, 1999 except as Vice President of GPUS which is effective April 30, 1999.
C. A. Mascari assumed the position of Controller of JCP&L, Met-Ed and
Penelec; and P. E. Maricondo assumed the position of Controller of Nineveh
Water Co.
(U) Effective February 12, 1999, B. L. Levy resigned as President of GPU AR and
was replaced by R. S. Plenderleith. K. L. Bortz assumed the position of
Controller of GPU AR, replacing R. S. Plenderleith. P. J. Panarella was
named to the position of Assistant Secretary.
23
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
PART I. AS OF DECEMBER 31, 1998
KEY
---------------------------------------------
CH - Chairman
CB - Chairman of the Board
D - Director
P - President
EVP - Executive Vice President
SVP - Senior Vice President
VP - Vice President
C - Comptroller
T - Treasurer
S - Secretary
S-D - Secretary (Domestic Companies)
S-I - Secretary (International Companies)
AS - Assistant Secretary
AS-D - Assistant Secretary (Domestic Companies)
AS-I - Assistant Secretary (International Companies)
AT - Assistant Treasurer
AC - Assistant Comptroller
24
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
Part II. AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
NAME AND LOCATION POSITION HELD APPLICABLE
NAME OF OFFICER OF IN FINANCIAL EXEMPTION
OR DIRECTOR FINANCIAL INSTITUTION INSTITUTION RULE
- --------------- --------------------- ------------- ----------
<S> <C> <C> <C>
D. Baldassari First Morris Bank Director 70(f)
Morristown, NJ
C. A. Rein Bank of New York Director 70(b)
New York, NY
S. B. Wiley First Morris Bank Director
Morristown, NJ (Chairman) 70(c)
R. L. Wise U.S. Bancorp, Inc. Director 70(f)
Johnstown, PA
" " U.S. Bancorp Director 70(f)
Trust Company
Johnstown, PA
" " U.S. National Bank Director 70(f)
of Johnstown
Johnstown, PA
</TABLE>
25
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS (Continued):
Part III.
Information concerning the compensation and other related information for
the Officers and Directors of GPU, JCP&L, Met-Ed and Penelec is filed as Exhibit
F-1 to this Form U5S.
26
<PAGE>
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS
<TABLE>
<CAPTION>
Name of Company Account
Name of Beneficiary Purpose Charged Amount
- ------------------- ------- ------- ------
<S> <C> <C> <C>
Jersey Central Power & Light Company:
Salary and Expenses - Public
Affairs Activities (2) (3) $1,355,966
Edison Electric Institute - Dues (1) (3) & (4) 151,463
Alliance for Competitive Electricity (1) (3) 41,435
Utility Water Act Group (1) (4) 3,189
New Jersey Alliance for Action (1) (3) 15,000
Strategy Group (2) (3) 35,665
Martin Bontempo, Inc. (2) (3) 54,367
Norwescap, Inc. (1) (3) 36,800
O.C.E.A.N., Inc. (1) (3) 55,200
5 Beneficiaries (1) & (2) (3) & (4) 10,085
----------
Company total $1,759,170
----------
Metropolitan Edison Company:
Salary & Expenses - Public
Affairs Activities (2) (3) $ 633,928
Edison Electric Institute - Dues (1) (3) & (4) 87,613
Alliance for Competitive Electricity (1) (3) 25,807
Utility Water Act Group (1) (4) 1,606
National Conference of State Legislators (2) (3) 1,140
Project Good Neighbor (1) (3) 88,791
5 Beneficiaries (1) & (2) (3) & (4) 14,870
----------
Company total $ 853,755
----------
Pennsylvania Electric Company:
Salary & Expenses - Public Affairs
Activities (2) (3) $ 725,198
Edison Electric Institute - Dues (1) (3) & (4) 106,809
Alliance for Competitive Electricity (1) (3) 22,211
Utility Water Act Group (1) (4) 1,583
Project Good Neighbor (1) (3) 102,051
----------
Company total $ 957,852
----------
Total for all Companies $3,570,777
==========
</TABLE>
27
<PAGE>
ITEM 7. CONTRIBUTIONS AND PUBLIC RELATIONS (Continued):
Notes: (1) Contribution or membership fee.
(2) Public relations services.
(3) Income deduction.
(4) Operating expense.
28
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS
Part I.
<TABLE>
<CAPTION>
Serving Receiving
Transaction Company Company Compensation
- ----------- ------- --------- ------------
(In Thousands)
<S> <C> <C> <C>
Charges incurred in JCP&L Met-Ed $ 431
connection with the " Penelec 440
Allenhurst Remittance Center
Phillipsburg building costs JCP&L GPUS 94
allocated to Corporate Plant
Accounting Department
Morristown Headquarters JCP&L GPUS 3,325
Building Costs
Costs associated with the Accounting JCP&L GPUS 629
Operations Department for services
provided
Construction Services provided by JCP&L GPU Telcom 3,654
JCP&L employees
Other JCP&L Met-Ed 3
" Penelec 3
" GPUI Group 5
-----
Total JCP&L $8,584
=====
</TABLE>
29
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS: (Continued)
Part I. (Continued)
<TABLE>
<CAPTION>
Serving Receiving
Transaction Company Company Compensation
- ----------- ------- ----------- ------------
(In Thousands)
<S> <C> <C> <C>
Costs incurred by Reprographics Met-Ed GPUN $ 184
Department for services provided " GPUS 230
" JCP&L 397
" Penelec 177
" Genco 428
" GPUI Group 2
" GPU, Inc. 8
Company Store charges Met-Ed GPUS 23
" JCP&L 127
" Penelec 92
" Genco 14
" GPUN 14
Computer Equipment Met-Ed GPU AR 23
Costs incurred by IS and Accounting Met-Ed GPUS 308
Departments for Services provided
Vehicle service and usage Met-Ed GPUS 113
" GPUN 7
" Penelec 1
" JCP&L 1
Costs incurred for the operation Met-Ed JCP&L 103
and maintenance of JCP&L owned
capacitors at TMI & Hosensack
Management services related to Met-Ed GPUI Group 204
Solaris Power
Gateway Building Met-Ed GPUS 194
Charge for use of Airport Building Met-Ed GPUS 422
Rental of office space Met-Ed GPUS 13
Training Services Met-Ed GPUN 27
Library Services Met-Ed GPUS 35
Mailroom Services Met-Ed GPUS 166
Construction Services provided Met-Ed GPU Telcom 1,844
By Met-Ed employees
Harrisburg lobbyist expenses Met-Ed GPUS 2
Services to Support Divestiture Met-Ed GPUS 39
Activities
Other Met-Ed GPUS 8
" GPUI Group 81
" GPUN 1
-----
Total Met-Ed $5,288
=====
</TABLE>
30
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS: (Continued)
Part I. (Continued)
<TABLE>
<CAPTION>
Serving Receiving
Transaction Company Company Compensation
- ----------- ------- --------- ------------
(In Thousands)
<S> <C> <C> <C>
Costs associated with GPU Penelec GPUN $ 58
consolidated Accounts " GPUS 26
Payable Department " Met-Ed 80
" JCP&L 113
" Genco 80
Costs associated with GPU Penelec GPUN 20
consolidated Payroll " GPUS 10
Department " Met-Ed 21
" JCP&L 35
" Genco 27
Vehicle usage Penelec Met-Ed 21
Construction Services provided Penelec GPU Telcom 25
by Penelec employees
Rental of office space Penelec Genco 2,238
Costs associated with other GPU Penelec Genco 41
System consolidated General and
Administrative functions
Costs associated with Penelec Genco 173
mobile maintenance
Other Penelec GPUN 21
" Met-Ed 18
------
Total Penelec $ 3,007
======
</TABLE>
31
<PAGE>
ITEM 8. SERVICE, SALES AND CONSTRUCTION CONTRACTS: (Continued)
Part I.
A Mutual Assistance Agreement, approved by the Pennsylvania Public Utility
Commission by order dated December 15, 1993, between and among Met-Ed, Penelec,
JCP&L, GPUN, GPUS and Genco covering various affiliate transactions in goods and
services remains in effect at year-end.
Service Agreement, between GPUS and GPU AR dated as of June 30, 1997 covering
various affiliate transactions in goods and services remains in effect at year-
end.
Agreement between and among JCP&L, Met-Ed, Penelec, GPUS, GPU AR and GPU Telcom
dated as of April 25, 1997 covering various affiliate transactions in services
remains in effect at year-end.
A Capacity Use and Service Agreement dated April 25, 1998 by and between GPU
Telcom, JCP&L, Met-Ed and Penelec concerning various affiliate transactions in
goods and services remains in effect at year-end.
A Facilities Lease and Indefeasible Right of Use Agreement dated April 24, 1998
between GPU Telcom, JCP&L, Met-Ed and Penelec concerning various affiliate
transactions in goods and services remains in effect at year-end.
An Agency Agreement dated April 24, 1998 between GPU Telcom, JCP&L, Met-Ed and
Penelec concerning various affiliate transactions in goods and services remains
in effect at year-end.
Part II.
None.
Part III.
None.
32
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES
EXEMPT WHOLESALE GENERATORS (EWG):
- ---------------------------------
EI Selkirk, Inc. and Selkirk Cogeneration Partners Limited Partnership
- ----------------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU International, Inc. (GPUI), through its wholly-
owned subsidiary EI Selkirk, Inc., owned a 13.55% preferred interest and a
20% common interest in Selkirk Cogeneration Partners Limited Partnership
(Selkirk).
Selkirk is a Delaware limited partnership and was formed for the purpose of
constructing, owning and operating two natural gas-fired combined-cycle
cogeneration facilities located in Bethlehem, New York. The facilities are
79.9 and 270 megawatts (MW) each with a combined average net capacity of
349.9 MW producing steam and electricity.
(b) GPU, Inc. (GPU), indirectly through its wholly-owned subsidiary GPUI, has
invested $9,040,049 in Selkirk.
(c) Ratio of debt to common equity of Selkirk - (8.7):1
Accumulated earnings of Selkirk - $2,755,602
(d) None.
Part II.
An organizational chart showing the relationship of GPU International, Inc. to
Selkirk is provided in Exhibit H-1.
Financial statements of Selkirk Cogeneration Partners Limited Partnership as of
and for the year ended December 31, 1998 are incorporated by reference to
Selkirk's 1998 Form 10-K filed with the SEC.
33
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Canada Holding Limited, EI Brooklyn Power Limited, EI Brooklyn Investments
- -----------------------------------------------------------------------------
Limited and EI Services Canada Limited
- --------------------------------------
Part I.
(a) At December 31, 1998, GPU International, Inc. (GPUI), through its wholly-
owned subsidiaries EI Canada Holding Limited, owns 100% of EI Services
Canada, Ltd.
(b) GPUI, through its wholly-owned subsidiary EI Canada Holding Limited, has
investments of $166,446 in EI Services Canada, Ltd.
(c) Ratio of debt to common equity of EI Services Canada, Ltd - (2.09):1
Accumulated losses of EI Services Canada, Ltd. - $118,561.
(d) EI Services Canada Limited (ESC), a wholly-owned subsidiary of GPUI, was
replaced as operator upon Brooklyn Energy L.P. being placed in
recievership.
Part II.
An organizational chart showing the relationship of GPU International, Inc. to
EI Services Canada, Ltd. is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of EI
Canada Holding, Ltd. and EI Services Canada, Ltd. as of and for the year ended
December 31, 1998 are provided in Exhibit I-1.
34
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
GPU Power, Inc.
- ---------------
Part I.
(a) At December 31, 1998, GPU, Inc. (GPU) owned 100% of GPU Power, Inc., a
Delaware corporation established to make investments in EWGs, own and/or
operate eligible facilities and to engage in project development activities
for eligible facilities.
(b) GPU has invested $97,850,000 in GPU Power, Inc.
(c) Ratio of debt to common equity - Not applicable.
Accumulated earnings of GPU Power, Inc. - $764,690
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to other
EWGs in which it has an interest is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
GPU Power, Inc. as of and for the year ended December 31, 1998 are provided in
Exhibit I-1.
35
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
Guaracachi America, Inc. and Empresa Guaracachi S.A.
- ----------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
Guaracachi America, Inc., owned 50% of Empresa Guaracachi S.A.
Empresa Guaracachi S.A. is a Bolivian corporation having three facilities
located in Bolivia in and around the cities of Santa Cruz, Sucre and
Potosi. It is an electric generating company having an aggregate capacity
of 216 megawatts.
(b) GPU, through its wholly-owned subsidiary GPU Power, Inc., invested
$47,131,000 in Empresa Guaracachi S.A. The investment was funded by a
capital contribution from GPU of $33,000,000 and borrowings of $14,131,000.
(c) Ratio of debt to common equity of Empresa Guaracachi S.A. - .6081:1
Accumulated earnings of Empresa Guaracachi S.A. - $7,456,717
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Empresa
Guaracachi S.A. is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
Empresa Guaracachi S.A. as of and for the year ended December 31, 1998 are
provided in Exhibit I-1.
36
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Barranquilla, Inc. and Termobarranquilla S.A.
- ------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
EI Barranquilla, Inc., owned a 28.6% interest in Termobarranquilla S.A.
Empresa de Servicios Publicos (TEBSA).
TEBSA consists of an existing 890 megawatt gas-fired generating plant
located near Barranquilla, Colombia. Electricity generated by these plants
will be sold to Corporacion Electrica de la Costa Atlantica (Corelca) under
a 20-year contract.
(b) As of December 31, 1998, GPU Power Inc. has made capital contributions
totaling $64,850,000 in TEBSA.
As of December 31, 1998, a guarantee of amounts up to $12,415,000 was made
by GPU for the benefit of the Bankers Trust Company as collateral agent on
behalf of the Secured Parties in connection with the obligations under the
loan agreements.
(c) Ratio of debt to common equity of TEBSA - Not applicable.
Accumulated earnings of TEBSA - $58,382,000
(d) See GPUI Colombia, Ltda. Item I, Part (d).
Part II.
An organization chart showing the relationship of GPU Power, Inc. to TEBSA is
provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
TEBSA as of and for the year ended December 31, 1998 are provided in Exhibit I-
1.
37
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
Barranquilla Lease Holding, Inc. and Los Amigos Leasing Company, Ltd.
- ---------------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
Barranquilla Lease Holding, Inc., owned a 100% interest in Los Amigos
Leasing Company, Ltd. (Leaseco).
Leaseco, which is a Bermuda corporation, had procured equipment to be used
by and leased to TEBSA. Pursuant to a lease agreement, Leaseco will deliver
certain non-Colombian equipment related to TEBSA, and TEBSA will make lease
payments equal to the interest and principal payments of Leaseco.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Power, Inc., has
invested $12,000 in Leaseco to capitalize the company.
(c) Ratio of debt to common equity of Leaseco - (134):1
Accumulated losses of Leaseco - $2,839,267
(d) Pursuant to the lease agreement, Leaseco will deliver certain non-Colombian
equipment related to the project to TEBSA during the construction period.
TEBSA will lease the imported equipment from Leaseco during an interim
lease term during the construction period and subsequently during a 15 year
basic lease term. During the interim lease term, TEBSA will pay rent to
Leaseco to reimburse it for certain expenses, including interest incurred
during construction. During the basic lease term, TEBSA will make lease
payments equal to the interest and principal payments of Leaseco.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Leaseco
is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
Leaseco as of and for the year ended December 31, 1998 are provided in Exhibit
I-1.
38
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI International and GPUI Colombia, Ltda.
- -----------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
EI International, owned a 100% interest in GPUI Colombia, Ltda.
GPUI Colombia, Ltda. has entered into an operation and maintenance (O&M)
agreement with TEBSA to provide management services to TEBSA over its 20-
year contract with Corelca. Fees for these management services are in
accordance with the terms and conditions of the O&M agreement.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Power, Inc., has
invested $10,000 in GPUI Colombia, Ltda. to capitalize the company.
GPUI has guaranteed the obligations of GPU Power, Inc.'s subsidiaries, GPUI
Colombia, Ltda. and International Power Advisors, Inc. (the Operators),
under the O&M agreement in the TEBSA project. Pursuant to the guarantee,
GPUI has guaranteed the performance of the Operators, of which the limit of
liability is $5,000,000.
(c) Ratio of debt to common equity of GPUI Colombia, Ltda. - Not applicable.
Accumulated earnings of GPUI Colombia, Ltda. - $73,634.
(d) See (a) above.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to GPUI
Colombia, Ltda. is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
GPUI Colombia, Ltda. as of and for the year ended December 31, 1998 are provided
in Exhibit I-1 as part of GPU Power, Inc.'s consolidating financial statements.
39
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
Hanover Energy Corporation
- --------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc. owned 100% of Hanover Energy
Corporation, a New Jersey corporation established to make future
investments in EWGs.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to Hanover Energy Corporation as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Hanover
Energy Corporation is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
40
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Power (China), Inc. and China Power Partners, L.P.
- -----------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc. through its wholly-owned subsidiary
EI Power (China), Inc., owned a 49% limited partnership interest and a 1%
general partnership interest in China Power Partners, L.P.
China Power Partners, L.P. is a Delaware limited partnership established to
make future investments in EWG's in China.
In December 1998, China was dissolved.
In November 1998, China Power Partners, L.P., transferred its partnership's
interest to Intersol (Asia, Ltd.), a non-affiliated company.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to EI Power (China), Inc. or China Power Partners, L.P. as of
December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to China
Power Partners L.P. is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
41
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Power (China) I, Inc. and Ming Jiang Power Partners, L.P.
- ------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
EI Power (China) I, Inc., owned a 49% limited partnership interest and a 1%
general partnership interest in Ming Jiang Power Partners, L.P.
Ming Jiang Power Partners, L.P. is a Delaware limited partnership
established to make future investments in EWGs in China.
In December 1998, China was dissolved.
In November 1998, Ming Jiang Power Partners, L.P., assigned interest to
Intersol (Asia, Ltd.), a non-affiliated company.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to EI Power (China) I, Inc. or Ming Jiang Power Partners,
L.P. as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Ming
Jiang Power Partners, L.P. is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
42
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Power (China) II, Inc. and Nanjing Power Partners, L.P.
- ----------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
EI Power (China) II, Inc., owned a 49% limited partnership interest and a
1% general partnership interest in Nanjing Power Partners, L.P.
Nanjing Power Partners, L.P. is a Delaware limited partnership established
to make future investments in EWGs in China.
In Nanjing Power Partners, L.P., was dissolved.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to EI Power (China) II, Inc. or Nanjing Power Partners, L.P.
as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Nanjing
Power Partners, L.P. is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
43
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
EI Power (China) III, Inc. and Zhuang He Power Partners, L.P.
- -------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc. through its wholly-owned subsidiary
EI Power (China) III, Inc., owned a 49% limited partnership interest and a
1% general partnership interest in Zhuang He Power Partners, L.P.
Zhuang He Power Partners, L.P. is a Delaware limited partnership
established to make future investments in EWG's in China.
In March 1999, Zhuang He Power Partners, L.P., was dissolved.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to EI Power (China) III, Inc. or Zhuang He Power Partners,
L.P. as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Zhuang He
Power Partners, L.P. is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
44
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
Austin Cogeneration Corporation and Austin Cogeneration Partners, L.P.
- ----------------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc., through its wholly-owned subsidiary
Austin Cogeneration Corporation, owned a 99% limited partnership interest
and a 1% general partnership interest in Austin Cogeneration Partners, L.P.
Austin Cogeneration Partners, L.P. is a Delaware limited partnership
established to invest in EWGs and qualifying facilities.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to Austin Cogeneration Corporation or Austin Cogeneration
Partners, L.P. as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to Austin
Cogeneration Partners, L.P. is provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
45
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
International Power Advisors, Inc.
- ----------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc. owned 100% of International Power
Advisors, Inc. (IPA), a Delaware corporation established to provide
technical services to EWGs.
IPA has entered into an operation and maintenance (O&M) agreement with
TEBSA to provide technical services and technical assistance in the O&M of
the generating facilities of TEBSA. Fees for these services are in
accordance with the terms and conditions of the O&M agreement.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Power, Inc, has
invested $108,433 in IPA.
(c) Ratio of debt to common equity - GPU Power, Inc. - Not applicable.
Accumulated earnings - None.
(d) See (a) above.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to IPA is
provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
46
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
EXEMPT WHOLESALE GENERATORS (EWG) (Continued):
- ---------------------------------
GPU Power Philippines, Inc. (formerly Colombian Installations, Inc.) and
- ------------------------------------------------------------------------
Magellan Utilities Development Corporation
- ------------------------------------------
Part I.
(a) At December 31, 1998, GPU Power, Inc. through its wholly-owned subsidiary,
GPU Power Philippines, Inc. (formerly Colombian Installations, Inc.), a
Delaware corporation owned a 13.2% interest in Magellan Utilities
Development Corporation (MUDC).
MUDC, a Philippine corporation, plans to build a 300 MW pulverized coal-
fired power plant which will sell power under a 25-year power purchase
agreement to Manila Electric Company. The plant will be constructed on a
100-acre site located on the south shore of Bantangas Bay, Philippines.
Commercial operation is expected after a three-year construction period.
(b) None.
(c) Ratio of debt to common equity - GPU Power, Inc. has not made equity
contributions to GPU Power Philippines, Inc. as of December 31, 1998.
Accumulated earnings - None.
(d) None.
Part II.
An organizational chart showing the relationship of GPU Power, Inc. to MUDC is
provided in Exhibit H-1.
Exhibit I-1 - Not applicable.
47
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
FOREIGN UTILITY COMPANIES (FUCO):
- --------------------------------
GPU Capital, Inc.
- -----------------
Part I.
(a) At December 31, 1998, GPU owned 100% of GPU Capital, Inc., a Delaware
corporation established to make investments in FUCO's, own and/or operate
eligible facilities and to engage in project development activities for
eligible facilities.
(b) None.
(c) Ratio of debt to common equity - Not applicable.
Accumulated earnings of GPU Capital, Inc. - $56,133,922.
(d) None.
Part II:
An organizational chart showing the relationship of GPU Capital, Inc. to other
FUCO's in which it has an interest is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
GPU Capital, Inc. as of and for the year ended December 31, 1998 are provided in
Exhibit I-1.
48
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
FOREIGN UTILITY COMPANIES (FUCO):
- --------------------------------
GPU Electric, Inc.
- ------------------
Part I.
(a) At December 31, 1998, GPU Capital owned 100% of GPU Electric, Inc., a
Delaware corporation established to make investments in FUCO's, own and/or
operate eligible facilities and to engage in project development activities
for eligible facilities.
(b) As of December 31, 1998, GPU has invested a total of $348,000,000 in GPU
Electric, Inc. of which an additional $250,000,000 was invested in 1998.
(c) Ratio of debt to common equity - Not applicable.
Accumulated losses - $(29,903,706).
(d) None.
Part II:
An organizational chart showing the relationship of GPU Electric, Inc. to other
FUCO's in which it has an interest is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
GPU Electric, Inc. as of and for the year ended December 31, 1998 are provided
in Exhibit I-1.
49
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
FOREIGN UTILITY COMPANIES (FUCO) (Continued):
- --------------------------------
Victoria Electric Holdings, Inc., and Victoria Electric, Inc.
- --------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Electric, Inc., through its wholly-owned
subsidiary Victoria Electric Holdings, Inc., owns 100% of Victoria
Electric, Inc.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Electric, Inc., has
an investment of approximately $18,679,874 in Victoria Holdings, Inc.
(c) Ratio of debt to common equity of Victoria Electric, Inc. - Not applicable.
Accumulated losses of Victoria Electric, Inc. - $27,561,860.
(d) None.
Part II:
Exhibit H-1 and I-1 - not applicable.
50
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
FOREIGN UTILITY COMPANIES (FUCO) (Continued):
- --------------------------------
EI UK Holdings, Inc., Avon Energy Partners Holdings, Avon Energy Partners plc
- -----------------------------------------------------------------------------
and Midlands Electricity plc
- ----------------------------
Part I.
(a) At December 31, 1998, GPU Electric, Inc. through its wholly-owned
subsidiary EI UK Holdings, Inc. (EIUK), owned a 50% interest in Avon Energy
Partners Holdings which owned 100% of Avon Energy Partners plc, which in
turn, owned 100% of Midlands Electricity plc (Midlands).
Midlands is an English regional electric company which supplies and
distributes electricity to 2.2 million customers in England. Midlands also
owns a generation business that produces electricity both domestically and
internationally, and a gas supply company that provides natural gas to
8,000 customers in England.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Electric, Inc., has
invested approximately $568 million in Midlands.
As of December 31, 1998, EIUK has outstanding approximately $373 million of
the initial $561 million, through a GPU, Inc. guaranteed five-year bank
term loan facility, which was used to fund its investment in Avon Energy
Partners Holdings.
(c) Ratio of debt to common equity of Midlands Electricity - .162:1
Accumulated earnings of Midlands Electricity - $2,283,900,000
(d) None.
Part II:
An organizational chart showing the relationship of GPU Electric, Inc. to
Midlands is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
Midlands as of and for the year ended December 31, 1998 are provided in Exhibit
I-1.
51
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
FOREIGN UTILITY COMPANIES (FUCO) (Continued):
- --------------------------------
GPU Australia Holdings, Inc., Austran Holdings, Inc., GPU PowerNet Pty. Ltd.,
- -----------------------------------------------------------------------------
GPU PowerNet Investment, Pty. Ltd. and Austran Investment Pty. Ltd.
- -------------------------------------------------------------------
Part I.
(a) At December 31, 1998, GPU Electric, Inc. through its wholly-owned
subsidiary GPU Australia Holdings, Inc. owned a 100% interest in Austran
Holdings, Inc., which in turn owned 100% of GPU PowerNet Pty. Ltd. (GPU
PowerNet).
GPU PowerNet is an Australian regional electric transmission company which
serves electricity to 4.5 million customers in the State of Victoria.
(b) GPU, indirectly through its wholly-owned subsidiary GPU Electric, Inc., has
invested approximately $1.9 billion in GPU PowerNet.
As of December 31, 1998, GPUI Australia Holdings, Inc., had outstanding
$350 million of debt, through a GPU, Inc. guaranteed five-year bank term
loan facility, to partially fund its investment in GPU PowerNet.
As of December 31, 1998, Austran Holdings, Inc., has outstanding
approximately $884 million, of its initial $1.4 billion, through a non-
recourse senior debt facility, which was used to fund the remaining
investment in GPU PowerNet. In addition, Austran Holdings, Inc. entered
into a $306 million commercial paper program to refinance the maturing
portion of its non-recourse senior debt facility.
(c) Ratio of debt to common equity of GPU PowerNet - 727.7:1
Accumulated earnings of GPU PowerNet - $2,227,564
(d) None.
Part II:
An organizational chart showing the relationship of GPU Electric, Inc. to GPU
PowerNet is provided in Exhibit H-1.
Filed pursuant to request for confidential treatment, financial statements of
GPU Australia Holdings, Inc., Austran Holdings, Inc., GPU PowerNet Pty. Ltd.,
GPU PowerNet Investment, Pty. Ltd. and Austran Investment Pty. Ltd. as of and
for the year ended December 31, 1998 are provided in Exhibit I-1 as part of GPU
Electric, Inc.'s consolidating financial statements.
52
<PAGE>
ITEM 9. WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
Part III.
GPU's aggregate investment in EWG's and FUCO's at December 31, 1998, was as
follows*:
EWG's: $ 132,616,000
FUCO's: $ 1,071,387,000
GPU's aggregate capital investment in domestic public utility subsidiary
companies at December 31, 1998 was approximately $3,012,500,000.
Ratio of GPU's aggregate investment of EWG's and FUCO's to GPU's aggregate
investment in domestic public utility subsidiary companies at December 31, 1998,
was as follows:
EWG's: .04:1
FUCO's: .36:1
*Pursuant to Rule 53(a)(1)(i) under the Public Utility Holding Company Act of
1935, aggregate investment as stated herein Part III includes all amounts
invested, or committed to be invested, in foreign utility companies (FUCO) and
exempt wholesale generators (EWG), for which there is recourse, directly or
indirectly, to the registered holding company.
53
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS
Page
------
Consolidating Financial Statements, Schedules and Notes
- -------------------------------------------------------
- Report of Independent Accountants. 55
- Consolidating Financial Statements of GPU, Inc. 56-68
for 1998.
- Combined Notes 1 through 15 to Consolidated Financial
Statements incorporated herein by reference, in Exhibit
A (page 69), in the GPU, Inc. Annual Report on Form 10-K
for 1998(Item 8 of 10-K).
- Combined Notes 1 through 15 to Consolidated Financial
Statements incorporated herein by reference, in Exhibit
A (page 69)in the Jersey Central Power & Light Company
Annual Report on Form 10-K for 1998(Item 8 of 10-K).
- Combined Notes 1 through 15 to Consolidated Financial
Statements incorporated herein by reference, in Exhibit
A (page 69)in the Metropolitan Edison Company
Annual Report on Form 10-K for 1998(Item 8 of 10-K).
- Combined Notes 1 through 15 to Consolidated Financial
Statements incorporated herein by reference, in Exhibit
A (page 69)in the Pennsylvania Electric Company
Annual Report on Form 10-K for 1998(Item 8 of 10-K).
- Exhibits 69
54
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of GPU, Inc.
In our opinion, the consolidated financial statements listed in Item 10 of this
Form U5S present fairly, in all material respects, the financial position of
GPU, Inc. and Subsidiary Companies at December 31, 1998 and the results of their
operations and their cash flows for the year then ended, in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides reasonable
basis for the opinion expressed above.
Our audit was conducted for the purpose of forming an opinion on the
consolidated financial statements taken as a whole. The supplementary
consolidating information and the financial statement exhibits of the individual
companies listed in Item 10 of this Form U5S are presented for purposes of
additional analysis rather than to present the financial position, results of
operations, and cash flows of the individual companies, and are not a required
part of the consolidated financial statements. The supplementary consolidating
information and the financial statement exhibits have been subjected to the
auditing procedures applied in the audit of the consolidated financial
statements and, in our opinion, are fairly stated, in all material respects, in
relation to the consolidated financial statements taken as a whole.
PricewaterhouseCoopers LLP
New York, New York
February 3, 1999
55
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Balance Sheet
December 31, 1998
------------------------------------------------------------
(In Thousands)
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania
Companies and Power & Light Edison Electric GPU
ASSETS Consolidated Adjustments GPU, Inc. Company Company Company Telcom
------------- --------------- ----------- -------------- ------------ ----------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Utility Plant:
In service, at original cost $11,025,439 $4,755,273 $2,247,627 $2,802,360
Less, accumulated depreciation 4,460,341 2,217,108 1,008,438 1,175,842
----------- ---------- ---------- -----------
Net utility plant in service 6,565,098 2,538,165 1,239,189 1,626,518
Construction work in progress 94,005 48,126 19,380 18,862 $ 1,295
Other, net 145,792 98,491 27,819 19,482
----------- ---------- ---------- ----------- ------
Net utility plant 6,804,895 2,684,782 1,286,388 1,664,862 1,295
----------- ---------- ---------- ----------- ------
Other Property and Investments:
Common stock of subsidiaries - $3,591,292(A) $3,591,292
GPU International Group
investments, net 682,125
Nuclear decommissioning trusts,
at market 716,274 422,277 211,194 82,203
Nuclear fuel disposal trust, at
market 116,871 116,871
Goodwill, net 545,262
Other, net 239,411 6,440 9,596 11,742 7,705 349
----------- ---------- ---------- ---------- ----------- ------
Total other property and
investments 2,299,943 3,591,292 3,597,732 548,744 222,936 90,508 349
----------- ---------- ---------- ---------- ---------- ----------- ------
Current Assets:
Cash and temporary cash
investments 72,755 2,356 1,850 442 2,750 3,845
Special deposits 62,673 6,047 1,062 2,632
Accounts receivable:
Customers, net 286,278 152,120 60,012 69,887 2,492
Other 126,088 268,341(B,C, 5,680 32,562 41,895 28,893 35
Unbilled revenues 144,076 D) 56,391 43,687 43,998
Materials and supplies, at
average cost
or less:
Construction and maintenance 155,827 79,863 24,727 39,452
Fuel 42,697 13,144 12,218 17,107
Investment held for sale 48,473
Deferred energy costs
Deferred income taxes 47,521 20,812 2,945 7,589
Prepayments 76,021 12,909 140 27,648 20,616 31,551 5
Other, net 6,177
---------- ------
Total current assets 1,062,409 287,427 8,176 390,437 207,604 243,859 6,377
----------- ---------- ---------- ---------- ---------- ----------- ------
Deferred Debits and Other Assets:
Regulatory assets:
Competitive transition charge 1,023,815 680,213 343,602
Other regulatory assets, net 2,882,413 753,885 921,934 1,206,594
----------- ---------- ---------- -----------
Total regulatory assets 3,906,228 753,885 1,602,147 1,550,196
Deferred income taxes 2,004,278 179,237 714,202 951,471 98
Other 210,356 14,244(E) 232 25,037 31,692 23,911
----------- ---------- ---------- ---------- ---------- ----------- ------
Total deferred debits and
other assets 6,120,862 14,244 232 958,159 2,348,041 2,525,578 98
----------- ---------- ---------- ---------- ---------- ----------- ------
Total Assets $16,288,109 $3,892,963 $3,606,140 $4,582,122 $4,064,969 $4,524,807 $ 8,119
=========== ========== ========== ========== ========== =========== ======
</TABLE>
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from
the respective annual reports on Form 10-K for the year ended December 31, 1998,
are an integral part of the consolidating
56
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Balance Sheet
December 31, 1998
----------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU GPU GPU GPU GPU GPU GPU
Advanced Generation Service Nuclear International Power Capital
ASSETS Resources, Inc. Inc. Inc. Inc. Inc. Inc. Inc.
--------------- ---------- -------- -------- ------------- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Utility Plant:
In service, at original cost $ 76,774 $1,143,405
Less, accumulated depreciation 31,581 27,372
-------- ----------
Net utility plant in service 45,193 1,116,033
Construction work in progress 6,342
Other, net
-------- ---------
Net utility plant 45,193 1,122,375
-------- ---------
Other Property and Investments:
Common stock of subsidiaries
GPU International Group investments, net $ 80,614 $ 25,891 575,620
Nuclear decommissioning trusts, at market
Nuclear fuel disposal trust, at market
Goodwill, net 15,792 6,743 522,727
Other, net $ 115 $ 759 $ 20,959 $ 1,467 86,843 81,374 12,062
------- -------- -------- ------- -------- -------- ----------
Total other property and investments 115 759 20,959 1,467 183,249 114,008 1,110,409
------- -------- -------- ------- -------- -------- ----------
Current Assets:
Cash and temporary cash investments 757 90 10 55 4,589 23,786 32,225
Special deposits 211 103 317 11,643 40,658
Accounts receivable:
Customers, net 1,767
Other 5 107,560 29,330 64,444 40,774 7,635 35,616
Unbilled revenues
Materials and supplies, at average cost
or less:
Construction and maintenance 675 5,080 6,030
Fuel 228
Investment held for sale 20,846 27,627
Deferred energy costs
Deferred income taxes 5,843 1,139 9,193
Prepayments 7 4,926 51 1,922 1,407 657
Other, net 6,177
------- -------- -------- ------- -------- -------- ----------
Total current assets 2,536 112,787 29,494 64,816 92,697 79,705 111,348
------- -------- -------- ------- -------- -------- ----------
Deferred Debits and Other Assets:
Regulatory assets:
Competitive transition charge
Other regulatory assets, net
Total regulatory assets
Deferred income taxes 14,539 18,490 31,876 34,374 59,991
Other 4,439 4,750 1,396 87,203 43,449 2,491
------- -------- -------- ------- -------- -------- ----------
Total deferred debits and other assets 18,978 23,240 33,272 121,577 43,449 62,482
------- -------- -------- ------- -------- -------- ----------
Total Assets $ 2,651 $132,524 $118,886 $99,555 $397,523 $237,162 $2,406,614
======= ======== ======== ======= ======== ======== ==========
</TABLE>
_____________________
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
57
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Balance Sheet
December 31, 1998
----------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania
Companies and Power & Light Edison Electric GPU
LIABILITIES AND CAPITAL Consolidated Adjustments GPU, Inc. Company Company Company Telecom
------------- ------------ ----------- -------------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
Capitalization:
Common stock $ 331,958 $ 326,049 $ 331,958 $ 153,713 $ 66,273 $ 105,812
Capital surplus 1,011,310 1,766,772 1,011,310 510,769 370,200 285,486 $3,000
Retained earnings 2,230,425 1,529,775 2,230,425 893,016 234,066 367,653 2,063
Accumulated other
comprehensive income/(loss) (31,304) (31,304) (31,304) (425) 16,520 8,353
----------- ---------- ---------- ---------- ---------- ---------- -------
Total 3,542,389 3,591,292 (A) 3,542,389 1,557,073 687,059 767,304 5,063
Less: reacquired common
stock, at cost 77,741 77,741
----------- ---------- ---------- ---------- ---------- ---------- -------
Total common
stockholders' equity 3,464,648 3,591,292 3,464,648 1,557,073 687,059 767,304 5,063
Cumulative preferred stock:
With mandatory redemption 86,500 86,500
Without mandatory
redemption 66,478 37,741 12,056 16,681
Subsidiary-obligated
mandatorily redeemable
preferred securities 330,000 125,000 100,000 105,000
Long-term debt 3,825,584 14,244(E) 1,173,532 546,904 626,434
----------- ---------- ---------- ---------- ---------- ---------- -------
Total capitalization 7,773,210 3,605,536 3,464,648 2,979,846 1,346,019 1,515,419 5,063
----------- ---------- ---------- ---------- ---------- ---------- -------
Current Liabilities:
Securities due within one
year 563,683 4,538 2,512 30,024 50,012
Notes payable 368,607 69,100 122,344 79,540 86,023
Obligations under capital
leases 126,480 85,366 27,135 13,979
Accounts payable 394,815 262,985(B) 551 121,094 178,323 94,959 2,666
Taxes accrued 92,339 18,265(C) 5,559 19,463 32,755 149
Deferred energy 2,411 2,411
Interest accrued 81,931 1,639 62 26,678 16,747 19,700
Other 377,594 70,419 104,408 42,598 37,272
----------- ---------- ---------- ---------- ---------- ---------- -------
Total current liabilities 2,007,860 287,427 140,132 470,372 393,830 334,700 2,815
----------- ---------- ---------- ---------- ---------- ---------- -------
Deferred Credits and Other
Liabilities:
Deferred income taxes 3,044,947 670,961 1,010,982 1,338,235
Unamortized investment tax
credits 114,308 50,225 27,157 36,926
Three Mile Island Unit 2
future costs 483,515 120,904 241,707 120,904
Nuclear fuel disposal fee 189,138 141,270 31,912 15,956
Nonutility generation
contract loss 787,440 1,016,380
liability 1,803,820
Minority interest 44,344
Other 826,967 1,360 148,544 225,922 146,287 241
----------- ---------- ---------- ---------- ---------- ---------- -------
Total deferred credits
and other Liabilities 6,507,039 1,360 1,131,904 2,325,120 2,674,688 241
----------- ---------- ---------- ---------- ---------- ---------- -------
Total Liabilities and
Capital $16,288,109 $3,892,963 $3,606,140 $4,582,122 $4,064,969 $4,524,807 $8,119
=========== ========== ========== ========== ========== ========== =======
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
58
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Balance Sheet
December 31, 1998
----------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU GPU GPU GPU GPU GPU GPU
Advanced Generation Service Nuclear International Power Capital
LIABILITIES AND CAPITAL Resources, Inc. Inc. Inc. Inc. Inc. Inc. Inc.
---------------- ----------- ---------- -------- -------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Capitalization:
Common stock $ 50 $ 50 $ 50 $ 100 $ 1 $
Capital surplus $ 7,000 144,468 97,849 348,000
Retained earnings (6,911) (14,521) 769 53,640
Accumulated other comprehensive
income/(loss) (216) (3,933) 2,901 1 (54,505)
------- ------- -------- ------- -------- -------- -------
Total 89 (166) (3,883) 50 132,948 98,620 347,135
Less: reacquired common stock,
at cost
------- ------- -------- ------- -------- -------- -------
Total common stockholders' equity 89 (166) (3,883) 50 132,948 98,620 347,135
Cumulative preferred stock:
With mandatory redemption
Without mandatory redemption
Subsidiary-obligated mandatorily
redeemable preferred securities
Long-term debt 22,000 36,694 1,434,264
-------- -------- -------- ------- -------- -------- ---------
Total capitalization 89 (166) 18,117 50 132,948 135,314 1,781,399
-------- -------- -------- ------- -------- -------- ---------
Current Liabilities:
Securities due within one year 32,285 453,388
Notes payable 11,600
Obligations under capital leases
Accounts payable 1,126 85,530 53,119 54,999 41,060 14,591 9,782
Taxes accrued 670 1,062 174 2,149 410 48,213
Deferred energy
Interest accrued 69 383 718 2,521 16,692
Other 608 17,398 16,614 21,025 12,884 3,625 50,743
------- -------- -------- ------- -------- -------- ---------
Total current liabilities 2,404 104,059 70,290 78,891 65,544 53,432 578,818
------- -------- -------- ------- -------- -------- ---------
Deferred Credits and Other Liabilities:
Deferred income taxes 158 99 8,347 668 9,290 361 5,846
Unamortized investment tax credits
Three Mile Island Unit 2 future
costs
Nuclear fuel disposal fee
Nonutility generation contract loss
liability
Minority interest 44,344
Other 28,532 22,132 19,946 189,741 3,711 40,551
------- -------- -------- ------- -------- -------- ---------
Total deferred credits and other
Liabilities 158 28,631 30,479 20,614 199,031 48,416 46,397
------- -------- -------- ------- -------- -------- ---------
Total Liabilities and Capital $ 2,651 $132,524 $118,886 $99,555 $397,523 $237,162 $2,406,614
======= ======== ======== ======= ======== ======== ==========
</TABLE>
___________________
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
59
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Retained Earnings
For the Twelve Months Ended December 31, 1998
-------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania GPU
Companies and Power & Light Edison Electric Telcom
Consolidated Adjustments GPU, Inc. Company Company Company Inc .
------------ ------------------ ----------- -------------- ------------ --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Operating Revenues $4,248,792 $ 87,124(B,C, $2,069,648 $919,594 $1,032,226 $16,115
---------- -------- ---------- -------
H,J)
Equity in Earnings of
Subsidiaries - 397,699(A) $397,699
---------- ---------- --------
Services Rendered at Cost
to Affiliated
Companies - 799,947(D,E,F)
---------- ----------
Services Rendered to
Non-Affiliated
Companies - 390,359(D,E,F)
---------- ----------
Operating Expenses:
Fuel 407,105 465,333(D,J) 86,431 99,511 176,548
Power purchased and
interchanged:
Affiliates - 78,138(C) 57,643 17,766 2,729
Others 1,122,841 658,742 220,095 233,395
Deferral of energy and
capacity costs,
net (25,542) (25,542)
Other operation and
maintenance 1,106,913 703,139(B,C,D,E 4,562 485,054 247,189 275,107 12,722
F,H)
Depreciation and
amortization 522,094 4,897(E,H) 250,675 109,148 109,800
Taxes, other than
income taxes 219,302 22,901(D,E,F) 151 94,586 58,459 63,874
---------- ---------- -------- ---------- -------- ---------- -------
Total operating
expenses 3,352,713 1,274,408 4,713 1,607,589 752,168 861,453 12,722
---------- ---------- -------- ---------- -------- ---------- -------
Operating income before
income taxes 896,079 400,721 392,986 462,059 167,426 170,773 3,393
Income taxes 238,241 1,063(D,E,F) 164,445 42,979 45,150 1,498
---------- ---------- -------- ---------- -------- ---------- -------
Operating Income 657,838 399,658 392,986 297,614 124,447 125,623 1,895
---------- ---------- -------- ---------- -------- ---------- -------
Other Income and Deductions:
Allowance for other funds
used
during construction 916 134(D) 786 130
Equity in undistributed
earnings/(losses)
of affiliates 72,012
Other income/(expense),
net 48,366 3,317(D,E,F,G) (672) 13,227 (13,539) (6,429) 271
Income taxes (1,848) 19,367 5,556 2,613
---------- ---------- -------- ---------- -------- ---------- -------
Total other income
and deductions 119,446 3,451 (672) 33,380 (7,853) (3,816) 271
---------- ---------- -------- ---------- -------- ---------- -------
Income Before Interest
Charges and
Preferred Dividends 777,284 403,109 392,314 330,994 116,594 121,807 2,166
---------- ---------- -------- ---------- -------- ---------- -------
Interest Charges and
Preferred Dividends:
Interest on long-term
debt 318,396 4,481(E,G,J) 87,261 42,493 47,729
Other interest 35,053 1,083(E,F,G) 6,433 12,229 8,194 8,197
Allowance for borrowed
funds used during
Construction (4,348) (154)(D) (1,638) (813) (1,897)
Dividends on
subsidiary-obligated
mandatorily redeemable
preferred securities 28,888 10,700 9,000 9,188
Preferred stock
dividends of
subsidiaries
net of gain on
reacquisition 11,243 (11,243)(A)
---------- ---------- -------- ---------- -------- ---------- -------
Total interest
charges and
preferred dividends 389,232 (5,833) 6,433 108,552 58,874 63,217
---------- ---------- -------- ---------- -------- ---------- -------
Minority interest net
(income)/loss (2,171)
---------- ---------- -------- ---------- -------- ---------- -------
Income before extraordinary item 385,881 408,942 385,881 222,442 57,720 58,590 2,166
Extraordinary item- PA
Restructuring Orders,
net of income taxes (25,755) (25,755) (25,755) (6,805) (18,950)
---------- ---------- -------- ---------- -------- ---------- -------
Net Income $ 360,126 $ 383,187(A) $360,126 $ 222,442 $ 50,915 $ 39,640 $ 2,166
========== ========== ======== ========== ======== ========== =======
</TABLE>
_________________________
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from one respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
60
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Income
For the Twelve Months Ended December 31, 1998
---------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU GPU GPU GPU GPU GPU GPU
Advanced Generation Service Nuclear International Power Capital
Resources, Inc. Inc. Inc. Inc. Inc. Inc. Inc.
--------------- ---------- -------- -------- ------------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Operating Revenues $10,938 $ 72,256 $33,136 $182,000
------- ------------- -------- ---------
Equity in Earnings of Subsidiaries
Services Rendered at Cost to Affiliated
Companies $326,782 $104,423 $368,742
-------- -------- --------
Services Rendered to Non-Affiliated
Companies 390,213 118 28
-------- -------- ---------
Operating Expenses:
Fuel 465,333 30,326 14,289
Power purchased and interchanged:
Affiliates
Others 10,609
Deferral of energy and capacity costs,
net
Other operation and maintenance 3,844 241,470 92,784 359,899 40,776 12,055 34,590
Depreciation and amortization 4,897 4,560 5,844 42,067
Taxes, other than income taxes 9,979 4,365 8,557 492 103 1,637
------- -------- -------- -------- ------------- -------- ---------
Total operating expenses 14,453 716,782 102,046 368,456 76,154 32,291 78,294
------- -------- -------- -------- ------------- -------- ---------
Operating income before income taxes (3,515) 213 2,495 314 (3,898) 845 103,709
Income taxes (1,230) 391 1,086 (414) (1,796) (105) (12,700)
------- -------- -------- -------- ------------- -------- ---------
Operating Income (2,285) (178) 1,409 728 (2,102) 950 116,409
------- -------- -------- -------- ------------- -------- ---------
Other Income and Deductions:
Allowance for other funds used
during construction 134
Equity in undistributed earnings/
(losses) of affiliates 7,523 2,718 61,771
Other income/(expense), net 83 (110) 616 (329) 17,848 6,045 34,672
Income taxes (29) (10,899) (824) (17,632)
------- -------- -------- -------- ------------- -------- ---------
Total other income and deductions 54 24 616 (329) 14,472 7,939 78,811
------- -------- -------- -------- ------------- -------- ---------
Income Before Interest Charges and
Preferred Dividends (2,231) (154) 2,025 399 12,370 8,889 195,220
------- -------- -------- -------- ------------- -------- ---------
Interest Charges and Preferred Dividends:
Interest on long-term debt 1,341 748 4,219 139,086
Other interest 684 399
Allowance for borrowed funds used during
Construction (154)
Dividends on subsidiary-obligated
mandatorily redeemable
preferred securities
Preferred stock dividends of subsidiaries
------- -------- -------- -------- ------------- -------- ---------
Total interest charges and preferred
dividends (154) 2,025 399 748 4,219 139,086
------- -------- -------- -------- ------------- -------- ---------
Minority interest net income (2,171)
------- -------- -------- -------- ------------- -------- ---------
Income before extraordinary item (2,231) 11,622 2,499 56,134
Extraordinary item- PA Restructuring Orders,
net of income taxes
------- -------- -------- -------- ------------- -------- ---------
Net Income $(2,231) $ - $ - $ - $ 11,622 $ 2,499 $ 56,134
======= ======== ======== ======== ============= ======== =========
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
61
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Retained Earnings
For the Twelve Months Ended December 31, 1998
-------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania GPU
Companies and Power & Light Edison Electric Telcom
Consolidated Adjustments GPU, Inc. Company Company Company Inc .
------------ ------------ ----------- -------------- ------------ --------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at beginning of period $2,140,712 $1,509,683 $2,140,712 $875,639 $268,634 $393,708 $ (103)
Net income/(loss) 360,126 383,187 360,126 222,442 50,915 39,640 2,166
Cash dividends declared
on common stock (263,561) (263,561)
Cash dividends declared
on common stock of
subsidiary companies - (345,000) (195,000) (85,000) (65,000)
Cash dividends on cumulative
preferred stock - (11,243) (10,065) (483) (695)
Redemption of preferred stock
Other adjustments, net (6,852) (6,852) (6,852)
----------- ----------- ----------- ----------- ---------- -------- --------
Balance at end of period $ 2,230,425 $ 1,529,775 $ 2,230,425 $ 893,016 $ 234,066 $367,653 $ 2,063
=========== =========== =========== =========== ========== ======== ========
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by Reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
62
<PAGE>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Retained Earnings
For the Twelve Months Ended December 31, 1998
-------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
GPU GPU GPU GPU GPU GPU GPU
Advanced Generation Service Nuclear International Power Capital
Resources, Inc. Inc. Inc. Inc. Inc. Inc. Inc.
---------------- ---------- ------- ------- -------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at beginning of period $(4,680) $ - $ - $ - $(19,291) $(1,730) $(2,494)
Net income (2,231) 11,622 2,499 56,134
Cash dividends declared
on common stock
Cash dividends declared
on common stock of
subsidiary companies
Cash dividends on
cumulative preferred
stock
Other adjustments, net (6,852)
------- ----- ----- ----- -------- ------- -------
Balance at end of period $(6,911) $ - $ - $ - $(14,521) $ 769 $53,640
======= ===== ===== ===== ======== ======= =======
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
63
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Comprehensive Income
For the Twelve Months Ended December 31, 1998
----------------------------------------------------
(In Thousands)
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania
Companies and Power & Light Edison Electric
Consolidated Adjustments GPU, Inc. Company Company Company
-------------- ------------- ---------- --------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net income $360,126 $383,187 $360,126 $222,442 $50,915 $39,640
Other comprehensive income/(loss),
net of tax:
Net unrealized gains on
investments 8,987 8,987 8,987 4,148 2,064
Foreign currency translation (9,461) (9,461) (9,461)
Minimum pension liability (1,534) (1,534) (1,534) (425) (115) (43)
-------- -------- -------- ---------- ------------ ------------
Total other comprehensive
income/(loss) ( 2,008) (2,008) (2,008) (425) 4,033 2,021
-------- -------- -------- ---------- ------------ ------------
Comprehensive income $358,118 $381,179 $358,118 $222,017 $54,948 $41,661
======== ======== ======== ========== ============ ============
<CAPTION>
GPU
Telcom
Inc.
------
<S> <C>
Net income $2,166
Other comprehensive income/(loss),
net of tax:
Net unrealized gains on
investments
Foreign currency translation
Minimum pension liability
------
Total other comprehensive
income/(loss)
------
Comprehensive income $2,166
======
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
64
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Comprehensive Income
For the Twelve Months Ended December 31, 1998
-----------------------------------------------
(In Thousands)
GPU GPU GPU GPU GPU GPU GPU
Advanced Generation Service Nuclear International Power Capital
Resources, Inc. Inc. Inc. Inc. Inc. Inc. Inc.
---------------- ----------- -------- ------- ------------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net income $ (2,231) $ - $ - $ - $ 11,622 $ 2,499 $ 56,134
Other comprehensive
income/(loss), net of tax:
Net unrealized gains on
investments 2,898 (123)
Foreign currency
translation 3 1 (9,465)
Minimum pension liability (130) (821)
---------- --------- ------ ----- -------- ------ -------
Total other
comprehensive
income/(loss) - (130) (821) - 2,901 1 (9,588)
---------- --------- ------ ----- -------- ------ -------
Comprehensive income $ (2,231) $ (130) $ (821) $ - $ 14,523 $ 2,500 $ 46,546
========== ========= ====== ===== ======== ====== =======
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
65
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Cash Flows
For the Twelve Months Ended December 31, 1998
----------------------------------------------------------------------------------------------
(In Thousands)
GPU, Inc. and
Subsidiary Eliminations Jersey Central Metropolitan Pennsylvania
Companies and Power & Light Edison Electric
Consolidated Adjustments GPU, Inc. Company Company Company
-------------- ---------------- ------------- --------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Operating Activities:
- ---------------------
Net income $ 360,126 $ 383,187(A) $ 360,126 $ 222,442 $ 50,915 $ 39,640
Extraordinary item, net of income
tax benefit of
$16,300 25,755 6,805 18,950
---------- -------- -------- -------- ------- -------
Income before extraordinary item 385,881 383,187 360,126 222,442 57,720 58,950
Adjustments to reconcile income
to cash provided:
Equity in earnings of
subsidiaries (371,944)(A) (371,944)
Equity in undistributed
(earnings)/losses of
affiliates,net of
distributions received (44,621)
Depreciation and amortization 552,795 277,950 114,961 107,239
Amortization of property under
capital leases 49,913 26,739 14,666 7,319
Gain on sale of investments (43,548)
PaPUC restructuring rate orders 68,500 32,900 35,600
Nuclear outage maintenance
costs, net 3,105 (6,640) 6,494 3,251
Deferred income taxes &
investment tax credits, net (165,860) (41,865) (23,152) (15,496)
Deferred energy and capacity
costs, net (24,482) (24,482)
Allowance for other funds used
during construction (916) (786) (130)
Changes in working capital:
Receivables 91,285 (7,864)(A) (2,503)(A) (6,436) 433 (1,776)
Materials and supplies 704 3,863 (1,911) (1,310)
Special deposits and prepayments (18,514) (12,908) 21 (12,450) (13,861) (1,878)
Payables and accrued liabilities (18,645) 21,078(A) 1,152 (12,276) 10,446 16,709
Due to/from affiliates 3,015 10,723 1,333 21,467
Nonutility generation contract
buyout costs (54,018) (15,000) (32,917) (6,101)
Other, net 15,597 7,506 13,091 6,566 (31,479)
Net cash provided (required) by
---------- -------- -------- -------- ------- -------
operating activities 797,176 11,549 (2,627) 434,873 173,548 192,135
---------- -------- -------- -------- ------- -------
Investing Activities:
Capital expenditures and
investments:
GPU Energy companies (328,452) (154,918) (75,068) (89,550)
GPU International Group
investments (139,771)
Contributions to decommissioning
trusts (51,039) (28,003) (17,766) (5,270)
Proceeds from sale of investments 160,244
Other, net (37,876) 7,675(B) (357) (10,720) 465 (520)
Net cash (used for) provided by
---------- -------- -------- -------- ------- -------
investing activities (396,894) 7,675 (357) (193,641) (92,369) (95,340)
-------- -------- -------- ------- -------
Financing Activities:
Issuance of long-term debt 749,724
Increase (Decrease) in notes
payable, net (62,292) (7,675)(B) (22,500) 7,090 12,261 8,442
Retirement of long-term debt (1,036,110) (11) (22) (30,011)
Capital lease principal payments (50,663) (29,084) (13,609) (6,781)
Issuance of common stock 269,448 269,448
Redemption of preferred stock of
subsidiaries (15,000) (15,000)
Dividends paid on common stock (258,058) (258,058)
Dividends paid on common stock -
Internal 345,000 (195,000) (85,000) (65,000)
Dividends paid on preferred stock
of subsidiaries - (11,549)(A) (10,371) (483) (695)
Termination of interest rate swap
agreements (4,310)
Cash contributions to subsidiaries (328,550)
Net cash provided (required) by
---------- -------- -------- -------- ------- -------
financing activities (407,261) (19,224) 5,340 (242,376) (86,853) (94,045)
Effect of exchange rate changes on
cash (5,365)
---------- -------- -------- -------- ------- -------
Net increase (decrease) in cash
and temporary cash investments
from above (12,344) 2,356 (1,144) (5,674) 2,750
Cash and temporary cash
investments, beginning of year 85,099 - 2,994 6,116
---------- -------- -------- -------- ------- -------
Cash and temporary cash
investments, end of year $ 72,755 $ $ 2,356 $ 1,850 $ 442 $ 2,750
========== ======== ======== ======== ======= =======
Supplemental Disclosure:
Interest and preferred dividends
paid $ 370,303 $ 6,105 $ 116,942 $ 57,891 $ 64,057
========== ======== ======== ======= =======
Income taxes paid (refunded) $ 333,994 $ 192,335 $ 77,296 $ 46,732
========== ======== ======= =======
New capital lease obligations
incurred $ 37,793 $ 32,680 $ 3,399 $ 1,714
========== ======== ======= =======
Common stock dividends declared
but not paid $ 65,917 $ 65,917
========== ========
</TABLE>
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
66
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Cash Flows
For the Twelve Months Ended December 31, 1998
-----------------------------------------------------
(In Thousands)
GPU GPU GPU GPU GPU
Telcom Advanced Generation Service Nuclear
Inc. Resources Inc. Inc. Inc.
--------- ---------- --------- -------- ----------
<S> <C> <C> <C> <C> <C>
Operating Activities:
Net income $ 2,166 $ (2,231)
Extraordinary item, net of income tax benefit of
$16,300 --------- ----------
Income before extraordinary item 2,166 (2,231)
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiaries
Equity in undistributed (earnings) losses of affiliates,
net of distributions received
Depreciation and amortization $ 4,897
Amortization of property under capital leases 1,189
Nuclear outage maintenance costs, net
Deferred income taxes and investment tax credits, net (98) $ 2,683 (5,034) $ (4,161)
Deferred energy and capacity costs, net
Allowance for other funds used during construction
Changes in working capital:
Receivables (2,318) (326) 7,877 4,961 (586)
Materials and supplies 62
Special deposits and prepayments (4,888) 1,135 75
Payables and accrued liabilities 1,923 (888) 18,087 (1,613) 494
Due to/from affiliates 400 (1,927) (35,498) 3,080 (2,562)
Nonutility generation contract buyout costs
Other, net 240 (41) 11,748 1,483 6,659
--------- ---------- --------- -------- ----------
Net cash provided (required) by operating activities 2,375 (5,413) 9 10,098 (81)
--------- ---------- --------- -------- ----------
Investing Activities:
Capital expenditures and investments:
GPU Energy companies (1,560) (34) (7,322)
GPU International Group investments
Contributions to decommissioning trusts
Proceeds from sale of investments
Other, net (1,601) 61
--------- ---------- --------- -------- ----------
Net cash (used for) provided by investing activities (1,560) (34) (8,923) 61
--------- ---------- --------- -------- ----------
Financing Activities:
Issuance of long-term debt
Increase (Decrease) in notes payable, net
Retirement of long-term debt
Capital lease principal payments (1,189)
Issuance of common stock
Redemption of preferred stock of subsidiaries
Dividends paid on common stock
Dividends paid on common stock - Internal
Dividends paid on preferred stock of subsidiaries
Termination of interest rate swap agreements
Cash contributions to subsidiaries 2,800 2,900
--------- ---------- --------- -------- ----------
Net cash provided (required) by financing activities 2,800 2,900 (1,189)
--------- ---------- --------- -------- ----------
Effect of exchange rate changes on cash
--------- ---------- --------- -------- -----------
Net increase (decrease) in cash and temporary
Cash investments from above activities 3,615 (2,547) 9 (14) (20)
Cash and temporary cash investments, beginning of year 230 3,304 81 24 75
--------- ---------- --------- -------- ----------
Cash and temporary cash investments, end of year $ 3,845 $ 757 $ 90 $ 10 $ 55
========= ========== ========= ======== ==========
Supplemental Disclosure:
Interest and preferred dividends paid 1,181 399
--------- ----------
Income taxes paid (refunded) $ 1,212 $ (1,793) $ 4,274 $ 2,915 $ 4,213
========= ========== ========= ========= ==========
New capital lease obligations incurred
</TABLE>
Common stock dividends declared but not paid
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998, are an integral part of the
consolidating financial statements.
67
<PAGE>
<TABLE>
<CAPTION>
GPU, Inc. and Subsidiary Companies
Consolidating Statement of Cash Flows
For the Twelve Months Ended December 31, 1998
----------------------------------------------------
(In Thousands)
GPU GPU GPU
International Power Capital
Inc. Inc. Inc.
---------- ---------- ------------
<S> <C> <C> <C>
Operating Activities:
Net income $ 11,622 $ 2,499 $ 56,134
Extraordinary item, net of income tax benefit of
$16,300 ---------- ---------- ------------
Income before extraordinary item 11,622 2,499 56,134
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiaries
Equity in undistributed (earnings) losses of affiliates,
net of distributions received 13,760 (2,718) (55,663)
Depreciation and amortization (163) 5,844 42,067
Amortization of property under capital leases
Gain on sale of investments (9,146) (34,402)
PaPUC restructuring orders
Voluntary enhanced retirement programs
Nuclear outage maintenance costs, net
Deferred income taxes and investment tax credits, net (37,469) 110 (41,378)
Deferred energy costs and capacity costs, net
Allowance for other funds used during construction
Changes in working capital:
Receivables 3,277 (1,050) 81,868
Materials and supplies
Special deposits and prepayments 1,423 (90) (909)
Payables and accrued liabilities 2,684 4,335 (38,620)
Due to/from affiliates 10,591 3,377 (13,999)
Nonutility generation contract buyout costs
Other, net (9,154) 3,556 5,422
---------- ---------- ------------
Net cash provided (required) by operating activities (12,575) 15,863 520
---------- ---------- ------------
Investing Activities:
Capital expenditures and investments:
GPU Energy companies
GPU International Group investments (21,375) (59,847) (58,549)
Contributions to decommissioning trusts
Proceeds from sale of investments 9,000 151,244
Other, net 7,233 (24,762)
---------- ---------- ------------
Net cash (used for) provided by investing activities (5,142) (84,609) 92,695
---------- ---------- ------------
Financing Activities:
Issuance of long-term debt 23,600 25,166 700,958
Increase (Decrease) in notes payable, net (13,500) (7,675) (54,085)
Retirement of long-term debt (2,194) (1,003,872)
Capital lease principal payments
Redemption of preferred stock of subsidiaries
Dividends paid on common stock
Dividends paid on common stock - Internal
Dividends paid on preferred stock of subsidiaries
Termination of interest rate swap agreements (4,310)
Cash contributions to subsidiaries 8,000 64,850 250,000
---------- ---------- ------------
Net cash provided (required) by financing activities 18,100 80,147 (111,309)
---------- ---------- ------------
Effect of exchange rate changes on cash 3 1 (5,369)
---------- ---------- ------------
Net increase (decrease) in cash and temporary
cash investments from above activities 386 11,402 (23,463)
Cash and temporary cash investments, beginning of year 4,203 12,384 55,688
---------- ---------- ------------
Cash and temporary cash investments, end of year $ 4,589 $ 23,786 $ 32,225
=========== ========== ============
Supplemental Disclosure:
Interest and preferred dividends paid $ 1,234 $ 902 $ 121,592
=========== ========== ============
Income taxes paid (refunded) $ 38,451 $ (377) $ (31,264)
=========== ========== ============
New capital lease obligations incurred
</TABLE>
Common stock dividends declared but not paid
- --------------------
The notes to the consolidated financial statements of GPU, JCP&L, Met-Ed and
Penelec, which are incorporated by reference from the respective annual reports
on Form 10-K for the year ended December 31, 1998 are an integral part of the
consolidating financial statements.
68
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
A. Annual Reports
--------------
The following documents are incorporated by reference:
A-1 GPU, Inc. - Annual Report on Form 10-K for 1998 (File No. 1-6047)
Jersey Central Power & Light Company - Annual Report on Form 10-K for
1998 (File No. 1-3141)
Metropolitan Edison Company - Annual Report on Form 10-K for 1998 (File
No.1-446)
Pennsylvania Electric Company -Annual Report on Form 10-K for 1998
(File No.1-3522)
B. Certificates of Incorporation, Articles of Incorporation, By-Laws,
------------------------------------------------------------------
Partnership Agreements and Other Organizational Documents
---------------------------------------------------------
GPU, GPU Advanced Resources, GPU Telcom, GPU Genco, GPUS & GPUN
---------------------------------------------------------------
B-1 Articles of Incorporation of GPU, Inc., as amended through March 27,
1990 - incorporated by reference to Exhibit 3-A to GPU's Annual Report
on Form 10-K for 1989, File No. 1-6047.
B-2 Articles of Amendment to Articles of Incorporation of GPU, Inc., dated
as of May 5, 1995 - incorporated by reference to Exhibit A-4,
Certificate Pursuant to Rule 24, File No. 70-8569.
B-3 Articles of Incorporation of GPU, Inc. as amended August 1, 1996 -
incorporated by reference to Exhibit 3-A-2 to GPU, Inc.'s Annual Report
on Form 10-K for 1996, File No. 1-6047.
B-4 Articles of Incorporation of GPUS, as amended through April 27, 1994 -
incorporated by reference to
Exhibit A-1 to Application on Form U-1, File No. 70-4990.
B-5 Articles of Incorporation of GPUS, as amended through August 1, 1996 -
incorporated by reference to Exhibit B-5 to GPU, Inc.'s Annual Report
on Form U5S for the year 1996, File No. 30-126.
B-6 Certificate of Incorporation of GPUN, dated as of September 5, 1980 -
incorporated by reference to
Exhibit A-1 to Application on Form U-1, File No. 70-6443.
B-7 Certificate of Amendment to the Certificate of Incorporation of GPUN
dated August 1, 1996 - incorporated by reference to Exhibit B-7 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-8 Articles of Incorporation of GPU Genco, dated as of April 11, 1994 -
incorporated by reference to Exhibit A-1(a), Certificate Pursuant to
Rule 24, SEC File No. 70-8409.
B-9 Articles of Incorporation of GPU Genco, as amended August 1, 1996 -
incorporated by reference to Exhibit B-9 to GPU, Inc.'s Annual Report
on Form U5S for the year 1996, File No. 30-126.
B-10 Articles of Incorporation of Saxton Nuclear Experimental Corporation
(Saxton) dated as of March 29, 1974 - incorporated by reference to
Exhibit B-12 to GPU, Inc.'s Annual Report on Form U5S for the year
1988, File No. 30-126.
69
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU, GPU Advanced Resources, GPU Telcom, GPU Genco, GPUS & GPUN
---------------------------------------------------------------
B-11 Amended By-Laws of GPU, Inc., dated as of December 4, 1997 -
incorporated by reference to Exhibit 3-B to GPU, Inc.'s Annual Report
on Form 10-K for 1997, File No. 1-6047.
B-12 Amended By-Laws of GPUS, dated as of January 1, 1999.
B-13 Amended By-Laws of GPUN, dated as of April 29, 1993 - incorporated by
reference to Exhibit 3-A to GPU, Inc.'s Annual Report on Form 10K for
1993, File No.1-6047.
B-14 Amended By-Laws of GPU Genco, dated as of February 12, 1996 -
incorporated by reference to Exhibit A-2(a), Certificate Pursuant to
Rule 24, File No. 70-8409.
B-15 Certificate of Incorporation of GPU Energy Services, Inc., dated as of
September 13, 1996- incorporated by reference to Exhibit B-15 to GPU,
Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-126.
B-16 Certificate of Amendment of Certificate of Incorporation of GPU Energy
Services, Inc., dated as of January 15, 1997 to change the name of the
company to GPU Advanced Resources, Inc- incorporated by reference to
Exhibit B-16 to GPU Inc.'s Annual Report on Form U5S for the year 1997,
File No. 30-126.
B-17 By-Laws of GPU Advanced Resources, Inc., dated as of March 6, 1997-
incorporated by reference to Exhibit B-17 to GPU Inc.'s Annual Report
on Form U5S for the year 1997,
File No. 30-126.
B-18 Certificate of Incorporation of GPU Telcom Services, Inc., dated as of
September 13, 1996- incorporated by reference to Exhibit B-18 to GPU,
Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-126.
B-19 By-Laws of GPU Telcom Services, Inc., dated as of March 6, 1997-
incorporated by reference to Exhibit B-19 to GPU, Inc.'s Annual Report
on Form U5S for the year 1997, File No. 30-126.
B-20 Amended By-Laws of Saxton, dated as of March 30, 1984 - incorporated by
reference to Exhibit A-1(e) to
Application on Form U-1, File No. 70-7398.
B-21 Amendment to Section 37 of the By-Laws of Saxton, dated as of August
27, 1987 - incorporated by reference to Exhibit A-2(b), Certificate
Pursuant to Rule 24, File No. 70-7398.
B-22 Generating Station Operating Agreement among JCP&L, Met-Ed, Penelec and
GPU Genco, dated as of March 1, 1996 - incorporated by reference to
Exhibit B, Certificate Pursuant to Rule 24, File No. 70-8409.
70
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
B-23 Restated Certificate of Incorporation of JCP&L, dated as of May 26,
1982 - incorporated by reference to Exhibit 3-A to JCP&L's Annual
Report on Form 10-K for 1990, File No. 1-3141.
B-24 Certificate of Amendment to Restated Certificate of Incorporation of
JCP&L, dated as of June 19, 1992 incorporated by reference to Exhibit
A-2(a), Certificate Pursuant to Rule 24, File No. 70-7949.
B-25 Certificate of Amendment to Restated Certificate of Incorporation of
JCP&L, dated as of June 19, 1992 incorporated by reference to Exhibit
A-2(a)(i), Certificate Pursuant to Rule 24, File No. 70-7949.
B-26 Certificate of Incorporation of JCP&L Preferred Capital, Inc., dated as
of February 21, 1995 incorporated by reference to Exhibit A-1,
Application on Form U-1, File No. 70-8495.
B-27 Amended By-Laws of JCP&L, dated as of May 25, 1993 - incorporated by
reference to Exhibit 3-B to JCP&L's Annual Report on Form 10-K for
1993, File No. 1-3141.
B-28 By-Laws of JCP&L Preferred Capital, Inc., dated as of February 21, 1995
- incorporated by reference to
Exhibit A-2, Application on Form U-1, File No. 70-8495.
B-29 Amended and Restated Limited Partnership Agreement of JCP&L Capital,
L.P., dated as of May 11, 1995 incorporated by reference to Exhibit
A-5(a), Certificate Pursuant to Rule 24, File No. 70-8495.
B-30 Action Creating Series A Preferred Securities of JCP&L Capital, L.P.,
dated as of May 11, 1995 incorporated by reference to Exhibit A-6(a),
Certificate Pursuant to Rule 24, File No. 70-8495.
B-31 Payment and Guarantee Agreement of JCP&L, dated as of May 18, 1995 -
incorporated by reference to Exhibit B-1(a), Certificate Pursuant to
Rule 24, File No. 70-8495.
Met-Ed
------
B-32 Restated Articles of Incorporation of Met-Ed, dated as of April 3, 1992
- incorporated by reference to Exhibit B-18 to GPU, Inc.'s Annual
Report on Form U5S for the year 1991, File No. 30-126.
B-33 Articles of Incorporation of York Haven Power Company, dated as of
December 18, 1967 - incorporated by reference to Exhibit B-15 to GPU,
Inc.'s Annual Report on Form U5S for the year 1988, File No. 30-126.
B-34 Certificate of Incorporation of Met-Ed Preferred Capital, Inc., dated
as of May 6, 1994 - incorporated by reference to Exhibit 3-C to
Registration Statement on Form S-3, Registration No. 33-53673.
71
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Met-Ed
------
B-35 Amended By-Laws of Met-Ed, dated as of May 22, 1997- incorporated by
reference to Exhibit B-35 to GPU, Inc.'s Annual Report on Form U5S for
the year 1997, File No. 30-126.
B-36 Amended By-Laws of York Haven Power Company, dated as of January 1,
1985 - incorporated by reference to Exhibit A-1(d), Application on Form
U-1, File No. 70-7398.
B-37 Amendment to Section 29 of the By-Laws of York Haven Power Company,
dated as of September 8, 1987 incorporated by reference to Exhibit
A-2(a), Certificate Pursuant to Rule 24, File No. 70-7398.
B-38 By-Laws of Met-Ed Preferred Capital, Inc., dated as of May 6, 1994 -
incorporated by reference to Exhibit A-2, Application on Form U-1, File
No. 70-8401.
B-39 Amended and Restated Limited Partnership Agreement of Met-Ed Capital,
L.P., dated as of August 16, 1994 - incorporated by reference to
Exhibit A-5(a), Certificate Pursuant to Rule 24, File No. 70-8401.
B-40 Action Creating Series A Preferred Securities of Met-Ed Capital, L.P.,
dated as of August 16, 1994 incorporated by reference to Exhibit
A-6(a), Certificate Pursuant to Rule 24, File No. 70-8401.
B-41 Certificate of Incorporation of Met-Ed Preferred Capital II, Inc.,
dated as of September1, 1998- incorporated by reference to Exhibit 3-C,
Registration Statement on Form S-3, SEC Registration Nos.
333-62967, 333-62967-01 and 333-62967-02.
B-42 By-Laws of Met-Ed Preferred Capital II, Inc., dated as of September 1,
1998- incorporated by reference to Exhibit 3-D, Registration Statement
on Form S-3, SEC Registration Nos. 333-62967, 333-62967-01 and
333-62967-02.
B-43 Certificate of Limited Partnership of Met-Ed Capital II, L.P., dated as
of September 1, 1998-incorporated by reference to Exhibit 3E,
Registration Statement on Form S-3, SEC Registration Nos.
333-62967, 333-62967-01 and 333-62967-02.
B-44 Certificate of Business Trust Registration of Met-Ed Capital Trust,
dated as of September 1,1998- incorporated by reference to Exhibit 4-K,
Registration Statement on Form S-3, SEC Registration Nos.
333-62967, 333-62967-01, and 333-62967-02.
B-45 Payment and Guarantee Agreement of Met-Ed, dated as of August 23, 1994
- incorporated by reference to Exhibit B-1(a), Certificate Pursuant to
Rule 24, File No. 70-8401.
72
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
B-46 Restated Articles of Incorporation of Penelec, as amended through March
10, 1992 - incorporated by reference to Exhibit 3-A to Penelec's Annual
Report on Form 10-K for 1991, File No. 1-3522.
B-47 Articles of Incorporation of Nineveh Water Company (formerly Penelec
Water Company), dated as of May 22, 1920 - incorporated by reference to
Exhibit B-36 to GPU, Inc.'s Annual Report on Form U5S for the year
1988, File No. 30-126.
B-48 Certificate of Incorporation of Penelec Preferred Capital, Inc., dated
as of May 9, 1994 - incorporated by reference to Exhibit 3-C to
Registration Statement on Form S-3, Registration No. 33-53677.
B-49 Amended By-Laws of Penelec, dated as of May 22, 1997 - incorporated by
reference to Exhibit B-45 to GPU, Inc.'s Annual Report on Form U5S for
the year 1997, File No. 30-126.
B-50 By-Laws of Nineveh Water Company, dated as of May 22, 1920 -
incorporated by reference to Exhibit A-1(c), Application on Form U-1,
File No. 70-7398.
B-51 Amendment to Article V, Section 6 of the By-Laws of Nineveh Water
Company, dated as of August 27, 1987 -incorporated by reference to
Exhibit A-1 (c), Certificate Pursuant to Rule 24, File No. 70-7398.
B-52 By-Laws of Penelec Preferred Capital, Inc., dated as of May 9, 1994 -
incorporated by reference to Exhibit A-2, Application on Form U-1, File
No. 70-8403.
B-53 Amended and Restated Limited Partnership Agreement of Penelec Capital,
L.P., dated as of June 27, 1994 incorporated by reference to Exhibit
A-5(a), Certificate Pursuant to Rule 24, File No. 70-8403.
B-54 Action Creating Series A Preferred Securities of Penelec Capital, L.P.,
dated as of June 27, 1994 incorporated by reference to Exhibit A-6(a),
Certificate Pursuant to Rule 24, File No. 70-8403.
B-55 Payment and Guarantee Agreement of Penelec, dated as of July 5, 1994 -
incorporated by reference to Exhibit B-1(a), Certificate Pursuant to
Rule 24, File No. 70-8403.
B-56 Certificate of Incorporation of Penelec Preferred Capital II, Inc.,
dated as of August 20, 1998- incorporated by reference to Exhibit 3-C,
Registration Statement on Form S-3, SEC Registration Nos.
333-62295, 333-62295-01 and 333-62295-02.
B-57 By-Laws of Penelec Preferred Capital II, Inc., dated as of August 20,
1998- incorporated by reference to Exhibit 3-D, Registration Statement
on Form S-3, SEC Registration Nos. 333-62295, 333-62295-01 and
333-62295-02.
73
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
B-58 Certificate of Limited Partnership of Penelec Capital II, L.P., dated
as of August 20, 1998- incorporated by reference to Exhibit 3-E,
Registration Statement on Form S-3, SEC Registration Nos.
333-62295, 333-62295-01 and 333-62295-02.
B-59 Certificate of Business Trust Registration of Penelec Capital Trust,
dated as of August 20, 1998- incorporated by reference to Exhibit 4-J,
Registration Statement on Form S-3, SEC Registration Nos.
333-62295, 333-62295-01 and 333-62295-02.
GPU International Group
-----------------------
B-60 Amended and Restated Certificate of Incorporation of EI, dated as of
September 14, 1990 - incorporated by reference to Exhibit B-5 to GPU,
Inc.'s Annual Report on Form U5S for the year 1990, File No. 30-126.
B-61 Certificate of Amendment of Certificate of Incorporation of Energy
Initiatives, Inc., dated as of August 1, 1996 to change the name of the
company to GPU International, Inc. - incorporated by reference to
Exhibit B-48 to GPU, Inc.'s Annual Report on Form U5S for the year
1996, File No. 30-126.
B-62 Certificate of Incorporation of Elmwood Energy Corporation, dated as of
February 13, 1987 - incorporated by reference to Exhibit B-11 to GPU,
Inc.'s Annual Report on Form U5S for the year 1988, File No. 30-126.
B-63 Certificate of Incorporation of Camchino Energy Corporation, dated as
of April 26, 1989 - incorporated by reference to Exhibit B-7 to GPU,
Inc.'s Annual Report on Form U5S for the year 1989, File No. 30-126.
B-64 Certificate of Incorporation of OLS Acquisition Corporation, dated as
of May 3, 1989 - incorporated by reference to Exhibit B-8 to GPU,
Inc.'s Annual Report on Form U5S for the year 1989, File No. 30-126.
B-65 Articles of Incorporation of OLS Energy - Camarillo, dated as of August
8, 1984 - incorporated by reference to Exhibit B-10 to GPU, Inc.'s
Annual Report on Form U5S for the year 1989, File No. 30-126.
B-66 Articles of Incorporation of OLS Energy - Chino, dated as of August 8,
1984 - incorporated by reference to Exhibit B-11 to GPU, Inc.'s Annual
Report on Form U5S for the year 1989, File No. 30-126.
B-67 Certificate of Incorporation of Armstrong Energy Corporation, dated as
of July 14, 1988 - incorporated by reference to Exhibit B-14 to GPU,
Inc.'s Annual Report on Form U5S for the year 1989, File No. 30-126.
B-68 Certificate of Incorporation of Geddes Cogeneration Corporation, dated
as of March 23, 1989- incorporated by reference to Exhibit B-16 to GPU,
Inc.'s Annual Report on Form U5S for the year 1989, File No. 30-126.
74
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-69 Articles of Incorporation of North Canadian Power, Inc., dated as of
November 21, 1989 - incorporated by reference to Exhibit B-13 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-70 Certificate of Amendment of Articles of Incorporation of North Canadian
Power, Inc., dated as of May 18, 1994, to change to name of the company
to NCP Energy, Inc. - incorporated by reference to Exhibit B-14 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-71 Certificate of Incorporation of NCP Lake Power, Inc., dated as of May
23, 1991 - incorporated by reference to Exhibit B-15 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-72 Certificate of Incorporation of NCP Gem, Inc., dated as of May 23, 1991
- incorporated by reference to Exhibit B-16 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-73 Certificate of Incorporation of Umatilla Groves, Inc., dated as of June
17, 1992 - incorporated by reference to Exhibit B-17 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-74 Certificate of Incorporation of NCP Dade Power, Inc., dated as of May
23, 1991 - incorporated by reference to Exhibit B-18 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-75 Certificate of Incorporation of NCP Pasco, Inc., dated as of May 23,
1991 - incorporated by reference to Exhibit B-19 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-76 Articles of Incorporation of ADA Management Corporation, dated as of
November 20, 1990 - incorporated by reference to Exhibit B-20 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-77 Certificate of Amendment of Articles of Incorporation of ADA Management
Corporation, dated as of July 31, 1993 to change the name of the
company to Commerce Cogeneration Corporation - incorporated by
reference to Exhibit B-21 to GPU, Inc.'s Annual Report on Form U5S for
the year 1994, File No. 30-126.
B-78 Certificate of Amendment of Articles of Incorporation of Commerce
Cogeneration Corporation, dated as of July 31, 1993 to change the name
of the company to NCP ADA Power, Inc. - incorporated by reference to
Exhibit B-22 to GPU, Inc.'s Annual Report on Form U5S for the year
1994, File No. 30-126.
B-79 Certificate of Incorporation of NCP Brooklyn Power, Inc., dated as of
July 9, 1993 - incorporated by reference to Exhibit B-23 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
75
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-80 Articles of Incorporation of Trigen Power Company, dated as of December
23, 1988 - incorporated by reference to Exhibit B-24 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-81 Certificate of Amendment of Articles of Incorporation of Trigen Power
Company, dated as of February 21, 1991 to change the name of the
company to ADA Power Company - incorporated by reference to Exhibit
B-25 to GPU, Inc.'s Annual Report on Form U5S for the year 1994, File
No. 30-126.
B-82 Certificate of Amendment of Articles of Incorporation of ADA Power
Company, dated as of August 31, 1993 to change the name of the company
to NCP Commerce Power, Inc. - incorporated by reference to Exhibit B-26
to GPU, Inc.'s Annual Report on Form U5S for the year 1994, File No.
30-126.
B-83 Certificate of Incorporation of NCP Houston Power, Inc., dated as of
December 1, 1993 - incorporated by reference to Exhibit B-27 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-84 Certificate of Incorporation of NCP Perry, Inc., dated as of December
1, 1993 - incorporated by reference to Exhibit B-28 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-85 Certificate of Incorporation of NCP New York, Inc., dated as of July 9,
1993 - incorporated by reference to Exhibit B-29 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-86 Certificate of Incorporation of EI Selkirk, Inc., dated as of October
31, 1994 - incorporated by reference to Exhibit B-30 to GPU, Inc.'s
Annual Report on Form U5S for the year 1994, File No. 30-126.
B-87 Certificate of Incorporation of EI Fuels Corporation, dated as of
August 9, 1990 - incorporated by reference to Exhibit B-17 to GPU,
Inc.'s Annual Report on Form U5S for the year 1993, File No. 30-126.
B-88 Certificate of Incorporation of EI Power, Inc., dated as of March 15,
1994 - incorporated by reference to Exhibit B-41 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-89 Certificate of Amendment of Certificate of Incorporation of EI Power,
Inc., dated as of August 1, 1996 to change the name of the company to
GPU Power, Inc. - incorporated by reference to Exhibit B-77 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, Form No. 30-126.
B-90 Certificate of Incorporation of Bermuda Hundred Energy, Inc., dated as
of July 25, 1989 - incorporated by reference to Exhibit B-12 to GPU,
Inc.'s Annual Report on Form U5S for the year 1989, File No. 30-126.
76
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-91 Certificate of Amendment to Certificate of Incorporation of Bermuda
Hundred Energy, Inc., dated as of March 16, 1993 - incorporated by
reference to Exhibit B-12-1 to GPU, Inc.'s Annual Report on Form U5S
for the year 1992, File No. 30-126.
B-92 Certificate of Amendment of the Certificate of Incorporation of
Bermuda Hundred Energy, Inc., dated as of March 16, 1993 to change the
name of the corporation to Hanover Energy Corporation - incorporated
by reference to Exhibit B-14 to GPU, Inc.'s Annual Report on Form U5S
for the year 1993, File No. 30-126.
B-93 Certificate of Incorporation of EI Power (China) II, Inc., dated as of
September 20, 1994 - incorporated by reference to Exhibit B-47 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-94 Certificate of Incorporation of EI Power (China) III, Inc., dated as
of September 20, 1994 incorporated by reference to Exhibit B-47 to
GPU, Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-
126.
B-95 Certificate of Incorporation of Austin Cogeneration Corporation, dated
as of January 27, 1995 incorporated by reference to Exhibit B-79 to
GPU, Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-
126.
B-96 Certificate of Incorporation of Guaracachi America, Inc., dated as of
July 13, 1995 - incorporated by reference to Exhibit B-80 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-97 By-Laws of Incorporation of EI Services Colombia, Ltda. (Public Deed
No. 2798), dated as of August 11, 1995 - incorporated by reference to
Exhibit B-81 to GPU, Inc.'s Annual Report on Form U5S for the year
1995, File No. 30-126.
B-98 Amendment to the By-Laws of Incorporation of EI Services Colombia,
Ltda. dated as of August 9, 1996 to change the name of the company to
GPU International Latin America, Ltda. (subsequently renamed GPUI
Colombia, Ltda.) - incorporated by reference to Exhibit B-88 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-99 By-Laws of Incorporation of Empresa Guaracachi S.A., effective as of
July 13, 1995 - incorporated by reference to Exhibit B-82 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-100 Certificate of Incorporation of EI Barranquilla, Inc., dated as of
July 10, 1995 - incorporated by reference to Exhibit B-83 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
77
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-101 By-Laws of Incorporation of Termobarranquilla S.A. (Public Deed No.
9994), dated as of October 14, 1994- incorporated by reference to
Exhibit B-84 to GPU, Inc.'s Annual Report on Form U5S for the year
1995, File No. 30-126.
B-102 Certificate of Incorporation of Barranquilla Lease Holding, Inc., dated
as of August 7, 1995 incorporated by reference to Exhibit B-85 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-103 Certificate of Incorporation of Los Amigos Leasing Company, Ltd., dated
as of August 18, 1995 incorporated by reference to Exhibit B-86 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-104 Certificate of Incorporation of International Power Advisors, Inc.,
dated as of August 14, 1995 incorporated by reference to Exhibit B-87
to GPU, Inc.'s Annual Report on Form U5S for the year 1995, File No.
30-126.
B-105 Certificate of Incorporation of Colombian Installations, Inc., dated as
of September 8, 1995 incorporated by reference to Exhibit B-88 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-106 Certificate of Amendment of Certificate of Incorporation of Colombian
Installations, Inc., dated as of August 26, 1996 to change the name of
the company to GPU Power Philippines, Inc. - incorporated by reference
to Exhibit B-96 to GPU, Inc.'s Annual Report on Form U5S for the year
1996, File No. 30-126.
B-107 Certificate of Incorporation of EI Energy, Inc., dated as of October
18, 1995 - incorporated by reference to Exhibit B-89 to GPU, Inc.'s
Annual Report on Form U5S for the year 1995, File No. 30-126.
B-108 Certificate of Amendment of Certificate of Incorporation of EI Energy,
Inc., dated as of August 1, 1996 to change the name of the company to
GPU Electric, Inc. - incorporated by reference to Exhibit B-98 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-109 Certificate of Incorporation of Victoria Electric, Inc., dated as of
October 18, 1995 - incorporated by reference to Exhibit B-90 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-110 Certificate of Incorporation of EI Services, Inc., dated as of October
7, 1993 - incorporated by reference to Exhibit B-91 to GPU, Inc.'s
Annual Report on Form U5S for the year 1995, File No. 30-126.
B-111 Certificate of Amendment to Certificate of Incorporation of EI
Services, Inc., dated as of August 7, 1995 - incorporated by reference
to Exhibit B-92 to GPU, Inc.'s Annual Report on Form U5S for the year
1995, File No. 30-126.
78
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-112 Certificate of Incorporation of Victoria Electric Holdings, Inc., dated
as of June 17, 1996 incorporated by reference to Exhibit B-102 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-113 Certificate of Incorporation of EI UK Holdings, Inc., dated as of April
30, 1996 - incorporated by reference to Exhibit B-103 to GPU, Inc.'s
Annual Report on Form U5S for the year 1996, File No. 30-126.
B-114 Memorandum and Articles of Association of Avon Energy Partners
Holdings, dated as of May 2, 1996 incorporated by reference to Exhibit
B-104 to GPU, Inc.'s Annual Report on Form U5S for the year 1996, File
No. 30-126.
B-115 Memorandum and Articles of Association of Avon Energy Partners plc,
dated as of April 29, 1996 incorporated by reference to Exhibit B-105
to GPU, Inc.'s Annual Report on Form U5S for the year 1996, File No.
30-126.
B-116 Memorandum of Association of Midlands Electricity plc, dated as of
March 9, 1989 - incorporated by reference to Exhibit B-106 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-117 Articles of Association of Midlands Electricity plc, adopted on
December 13, 1996 - incorporated by reference to Exhibit B-107 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-118 Certificate of Filing of Amended Articles of Incorporation of Magellan
Utilities Development Corporation, adopted on March 14, 1994-
incorporated by reference to Exhibit B-108 to GPU, Inc.'s Annual Report
on Form U5S for the year 1996, File No. 30-126.
B-119 Certificate of Incorporation of GPUI Lake Holdings, Inc., dated
December 30, 1996 - incorporated by reference to Exhibit B-109 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-120 Amended By-Laws of EI (subsequently renamed GPU International, Inc.),
dated as of May 14, 1993 incorporated by reference to Exhibit B-27 to
GPU, Inc.'s Annual Report on Form U5S for the year 1993, File No.
30-126.
B-121 Amended By-Laws of Elmwood Energy Corporation, adopted as of May 14,
1992 - incorporated by reference to Exhibit B-26 to GPU, Inc.'s Annual
Report on Form U5S for the year 1992, File No. 30-126.
B-122 By-Laws of Camchino Energy Corporation, adopted as of April 26, 1989 -
incorporated by reference to Exhibit B-53 to GPU, Inc.'s Annual Report
on Form U5S for the year 1989, File No. 30-126.
B-123 By-Laws of OLS Acquisition Corporation, adopted as of May 3, 1989 -
incorporated by reference to Exhibit B-54 to GPU, Inc.'s Annual Report
on Form U5S for the year 1989, File No. 30-126.
79
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-124 By-Laws of OLS Energy - Camarillo, adopted as of August 25, 1989 -
incorporated by reference to Exhibit B-56 to GPU, Inc.'s Annual Report
on Form U5S for the year 1989, File No. 30-126.
B-125 By-Laws of OLS Energy - Chino, adopted as of August 25, 1989 -
incorporated by reference to Exhibit B-57 to GPU, Inc.'s Annual Report
on Form U5S for the year 1989, File No. 30-126.
B-126 Amended By-Laws of Armstrong Energy Corporation, adopted as of May 14,
1992 - incorporated by reference to Exhibit B-33 to GPU, Inc.'s Annual
Report on Form U5S for the year 1992, File No. 30-126.
B-127 Amended By-Laws of Geddes Cogeneration Corporation, adopted as of May
14, 1992 - incorporated by reference to Exhibit B-34 to GPU, Inc.'s
Annual Report on Form U5S for the year 1992, File No. 30-126.
B-128 By-Laws of North Canadian Power, Inc. (subsequently renamed NCP Energy,
Inc.), adopted as of December 27, 1989 - incorporated by reference to
Exhibit B-70 to GPU, Inc.'s Annual Report on Form U5S for the year
1994, File No. 30-126.
B-129 By-Laws of NCP Lake Power, Inc., adopted as of May 23, 1991 -
incorporated by reference to Exhibit B-71 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-130 By-Laws of NCP Gem, Inc., adopted as of May 23, 1991 - incorporated by
reference to Exhibit B-72 to GPU, Inc.'s Annual Report on Form U5S for
the year 1994, File No. 30-126.
B-131 By-Laws of Umatilla Groves, Inc., adopted as of June 18, 1992 -
incorporated by reference to Exhibit B-73 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-132 By-Laws of NCP Dade Power, Inc., adopted as of May 23, 1991 -
incorporated by reference to Exhibit B-74 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-133 By-Laws of NCP Pasco, Inc., adopted as of May 23, 1991 - incorporated
by reference to Exhibit B-75 to GPU, Inc.'s Annual Report on Form U5S
for the year 1994, File No. 30-126.
B-134 By-Laws of Commerce Cogeneration Corporation, as amended through
October 3, 1992 (formerly known as ADA Management Corporation) -
subsequently renamed NCP ADA Power, Inc. - incorporated by reference to
Exhibit B-76 to GPU, Inc.'s Annual Report on Form U5S for the year
1994, File No. 30-126.
B-135 By-Laws of NCP Brooklyn Power, Inc., adopted as of July 10, 1993 -
incorporated by reference to Exhibit B-77 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
80
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-136 By-Laws of Trigen Power Company (successively renamed ADA Power Company
and NCP Commerce Power, Inc.), adopted as of December 30, 1988 -
incorporated by reference to Exhibit B-78 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-137 By-Laws of NCP Houston Power, Inc., adopted as of December 3, 1993 -
incorporated by reference to Exhibit B-79 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-138 By-Laws of NCP Perry, Inc., December 3, 1993 - incorporated by
reference to Exhibit B-80 to GPU, Inc.'s Annual Report on Form U5S for
the year 1994, File No. 30-126.
B-139 By-Laws of NCP New York, Inc., adopted as of July 10, 1993 -
incorporated by reference to Exhibit B-81 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-140 By-Laws of EI Selkirk, Inc., adopted as of November 1, 1994 -
incorporated by reference to Exhibit B-82 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-141 By-Laws of EI Cayman (subsequently renamed EI International), dated as
of June 16, 1993 - incorporated by reference to Exhibit B-87 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-142 By-Laws of EI Fuels Corporation, dated as of May 14, 1993 -
incorporated by reference to Exhibit B-37 to GPU, Inc.'s Annual Report
on Form U5S for the year 1993, File No. 30-126.
B-143 By-Laws of EI Power, Inc. (subsequently renamed GPU Power, Inc.), dated
as of May 2, 1994 - incorporated by reference to Exhibit B-89 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-144 Amended By-Laws of Hanover Energy Corporation (formerly Bermuda Hundred
Energy, Inc.), dated as of March 16, 1993 - incorporated by reference
to Exhibit B-32 to GPU, Inc.'s Annual Report on Form U5S for the year
1992, File No. 30-126.
B-145 By-Laws of EI Power (China) II, Inc., adopted as of September 22, 1994
- incorporated by reference to Exhibit B-93 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-146 By-Laws of EI Power (China) III, Inc., adopted as of September 22, 1994
- incorporated by reference to Exhibit B-94 to GPU, Inc.'s Annual
Report on Form U5S for the year 1994, File No. 30-126.
B-147 By-Laws of Austin Cogeneration Corporation, adopted as of January 27,
1995 - incorporated by reference to Exhibit B-123 to GPU, Inc.'s Annual
Report on Form U5S for the year 1995, File No. 30-126.
81
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-148 By-Laws of Guaracachi America, Inc., adopted as of July 13, 1995 -
incorporated by reference to Exhibit B-124 to GPU, Inc.'s Annual Report
on Form U5S for the year 1995, File No. 30-126.
B-149 By-Laws of EI Barranquilla, Inc., adopted as of December 29, 1995 -
incorporated by reference to Exhibit B-125 to GPU, Inc.'s Annual Report
on Form U5S for the year 1995, File No. 30-126.
B-150 By-Laws of Barranquilla Lease Holding, Inc., adopted as of December 29,
1995 - incorporated by reference to Exhibit B-126 to GPU, Inc.'s Annual
Report on Form U5S for the year 1995, File No. 30-126.
B-151 By-Laws of Los Amigos Leasing Company, Ltd., dated as of August 18,
1995 - incorporated by reference to Exhibit B-127 to GPU, Inc.'s Annual
Report on Form U5S for the year 1995, File No. 30-126.
B-152 By-Laws of International Power Advisors, Inc., adopted as of August 16,
1995 - incorporated by reference to Exhibit B-128 to GPU, Inc.'s Annual
Report on Form U5S for the year 1995, File No. 30-126.
B-153 By-Laws of Colombian Installations, Inc. (subsequently renamed GPU
Power Philippines, Inc.), adopted as of September 9, 1995 -
incorporated by reference to Exhibit B-129 to GPU, Inc.'s Annual Report
on Form U5S for the year 1995, File No. 30-126.
B-154 By-Laws of EI Energy, Inc. (subsequently renamed GPU Electric, Inc.),
dated as of October 20, 1995 incorporated by reference to Exhibit B-130
to GPU, Inc.'s Annual Report on Form U5S for the year 1995, File No.
30-126.
B-155 By-Laws of Victoria Electric, Inc., adopted as of October 20, 1995 -
incorporated by reference to Exhibit B-131 to GPU, Inc.'s Annual Report
on Form U5S for the year 1995, File No. 30-126.
B-156 By-Laws of Victoria Electric Holdings, Inc., adopted as of June 17,
1996 - incorporated by reference to Exhibit B-149 to GPU Inc.'s Annual
Report on Form U5S for the year 1996, File No. 30-126.
B-157 By-Laws of EI UK Holdings, Inc., adopted as of April 30, 1996 -
incorporated by reference to Exhibit B-150 to GPU Inc.'s Annual Report
on Form U5S for the year 1996, File No. 30-126.
B-158 Certificate of Filing of Amended By-Laws of Magellan Utilities
Development Corporation adopted on September 29, 1994- incorporated by
reference to Exhibit B-151 to GPU, Inc.'s Annual Report on Form U5S for
the year 1996, File No. 30-126.
B-159 By-Laws of GPUI Lake Holdings, Inc., adopted as of December 30, 1996 -
incorporated by reference to Exhibit B-152 to GPU, Inc.'s Annual Report
on Form U5S for the year 1996, File No. 30-126.
82
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-160 Memorandum of Association of 2322120 Nova Scotia Limited, dated as of
December 22, 1993 - incorporated by reference to Exhibit B-35 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-161 Certificate of Amendment of the Memorandum of Association of 2322120
Nova Scotia Limited, dated as of February 17, 1994 to change the name
of the company to EI Services Canada Limited - incorporated by
reference to Exhibit B-36 to GPU, Inc.'s Annual Report on Form U5S for
the year 1994, File No. 30-126.
B-162 Memorandum of Association of 2322133 Nova Scotia Limited, dated as of
December 22, 1993 - incorporated by reference to Exhibit B-31 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No.
30-126.
B-163 Certificate of Amendment of the Memorandum of Association of 2322133
Nova Scotia Limited, dated as of February 17, 1994 to change the name
of the company to EI Canada Holding Limited - incorporated by reference
to Exhibit B-32 to GPU, Inc.'s Annual Report on Form U5S for the year
1994, File No. 30-126.
B-164 Memorandum of Association of EI Cayman (subsequently renamed EI
International), dated as of June 16, 1993 - incorporated by reference
to Exhibit B-39 to GPU, Inc.'s Annual Report on Form U5S for the year
1994, File No. 30-126.
B-165 Memorandum of Association of EI Australia Services Pty Ltd.,
(subsequently renamed GPU International Australia Pty Ltd.), effective
as of October 26, 1995 - incorporated by reference to Exhibit B-142 to
GPU, Inc.'s Annual Report on Form U5S for the year 1995, File No.
30-126.
B-166 Articles of Association of 2322133 Nova Scotia Limited (subsequently
renamed EI Canada Holding Limited), adopted as of December 22, 1993 -
incorporated by reference to Exhibit B-83 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-167 Articles of Association of 2322120 Nova Scotia Limited (subsequently
renamed EI Services Canada Limited), adopted as of December 22, 1993 -
incorporated by reference to Exhibit B-85 to GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
B-168 Articles of Association of EI Australia Services Pty Ltd., adopted as
of October 26, 1995 - incorporated by reference to Exhibit B-148 to
GPU, Inc.'s Annual Report on Form U5S for the year 1995, File No.
30-126.
83
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-169 Agreement of Limited Partnership of Lake Cogen, Ltd., dated as of July
24, 1992 - incorporated by reference to Exhibit B-3(a), Application on
Form U-1, File No. 70-8369.
B-170 First Amendment to Limited Partnership Agreement of Lake Cogen, Ltd.,
dated as of June 13, 1994 incorporated by reference to Exhibit B-3(a),
Certificate Pursuant to Rule 24, File No. 70-8369.
B-171 Agreement of Limited Partnership of Lake Investment, L.P., dated as of
July 23, 1992 - incorporated by reference to Exhibit B-112 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-172 Amended and Restated Limited Partnership Agreement of Onondaga
Cogeneration Limited Partnership, dated as of June 10, 1992 -
incorporated by reference to Exhibit A-1(a), Certificate Pursuant to
Rule 24, File No. 70-7942.
B-173 Limited Partnership Agreement of Pasco Cogen, Ltd., as amended through
July 15, 1993 - incorporated by reference to Exhibit B-4(a)(i)-(iv),
Application on Form U-1, File No. 70-8369.
B-174 Fourth Amendment to Limited Partnership Agreement of Pasco Cogen, Ltd.,
dated as of June 13, 1994 incorporated by reference to Exhibit B-4(a),
Certificate Pursuant to Rule 24, File No. 70-8369.
B-175 Agreement of Limited Partnership of Dade Investment, L.P., dated as of
August 28, 1991 - incorporated by reference to Exhibit B-116 to GPU,
Inc.'s Annual Report on Form U5S for the year 1994, File No. 30-126.
B-176 Amended and Restated Limited Partnership Agreement of Prime Energy
Limited Partnership, dated as of August 7, 1987 - incorporated by
reference to Exhibit A-1, Application on Form U-1, File No. 70-7647.
B-177 Amendment to By-Laws of Incorporation of Termobarranquilla S.A. (Public
Deed No. 1198), dated as of February 24, 1995 - incorporated by
reference to Exhibit B-160 to GPU, Inc.'s Annual Report on Form U5S for
the year 1995, File No. 30-126.
B-178 Amendment to By-Laws of Incorporation of Termobarranquilla S.A. (Public
Deed No. 6455), dated as of October 4, 1995 - incorporated by reference
to Exhibit B-161 to GPU, Inc.'s Annual Report on Form U5S for the year
1995, File No. 30-126.
B-179 Amendment to By-Laws of Incorporation of Termobarranquilla S.A. (Public
Deed No. 2093), dated as of April 6, 1995 - incorporated by reference
to Exhibit B-162 to GPU, Inc.'s Annual Report on Form U5S for the year
1995, File No. 30-126.
84
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-180 Amendment to By-Laws of Incorporation of Termobarranquilla S.A. (Public
Deed No. 5777), dated as of September 5, 1995 - incorporated by
reference to Exhibit B-163 to GPU, Inc.'s Annual Report on Form U5S for
the year 1995, File No. 30-126.
B-181 Certificate of Amendment of Articles of Association of EI Cayman, dated
as of July 10, 1995 to change the name of the company to EI
International - incorporated by reference to Exhibit B-164 to GPU,
Inc.'s Annual Report on Form U5S for the year 1995, File No. 30-126.
B-182 Limited Partnership Agreement of Mid-Georgia Cogen, L.P., dated as of
April 15, 1996 - incorporated by reference to Exhibit B-186 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
B-183 Memorandum and Articles of Association of Australian Transmission
Corporation Pty. Ltd., dated as of September 30, 1997 - incorporated by
reference to Exhibit B-189 to GPU, Inc.'s Annual Report on Form U5S for
the year 1997, File No. 30-126.
B-184 Certificate of Registration and Change of Name of Australian
Transmission Corporation Pty. Ltd. to GPU PowerNet Pty. Ltd., effective
October 30, 1997- incorporated by reference to Exhibit B-190 to GPU
Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-126.
B-185 Amendment to the Certificate of Incorporation of GPU International
Latin America Ltda., dated as of March 6, 1997, to change the name of
the company to GPUI Colombia Ltda. - incorporated by reference to
Exhibit B-191 to GPU, Inc.'s Annual Report on Form U5S for the year
1997, File No.30-126.
B-186 Certificate of Incorporation of GPU Australia Holdings, Inc. dated as
of September 29, 1997 -incorporated by reference to Exhibit B-192 to
GPU, Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-
126.
B-187 By-Laws of GPU Australia Holdings, Inc., dated as of September 29, 1997
- incorporated by reference to Exhibit B-193 to GPU, Inc.'s Annual
Report on Form U5S for the year 1997, File No. 30-126.
B-188 Certificate of Incorporation of Austran Holdings, Inc., dated as of
September 29, 1997 - incorporated by reference to Exhibit B-194 to GPU,
Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-126.
B-189 Amended and Restated Certificate of Incorporation of Austran Holdings,
Inc., dated as of October 9, 1997 - incorporated by reference to
Exhibit B-195 to GPU, Inc.'s Annual Report on Form U5S for the year
1997, File No. 30-126.
B-190 By-Laws of Austran Holdings, Inc. adopted as of September 29, 1997 -
incorporated by reference to Exhibit B-196 to GPU, Inc.'s Annual Report
on Form U5S for the year 1997, File No. 30-126.
85
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-191 Certificate of Incorporation of GPU Power Ireland, Inc., dated October
14, 1997 - incorporated by reference to Exhibit B-199 to GPU, Inc.'s
Annual Report on Form U5S for the year 1997, File No. 30-126.
B-192 By-Laws of GPU Power Ireland, Inc. adopted as of October 14, 1997 -
incorporated by reference to Exhibit B-200 to GPU, Inc.'s Annual Report
on Form U5S for the year 1997, File No. 30-126.
B-193 Certificate of Registration of Austran Investments Pty. Ltd. dated as
of October 15, 1997 - incorporated by reference to Exhibit B-201 to
GPU, Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-
126.
B-194 Memorandum and Articles of Association of Austran Investments Pty. Ltd.
dated as of October 15, 1997 -incorporated by reference to Exhibit B-
202 to GPU, Inc.'s Annual Report on Form U5S for the year 1997, File
No. 30-126.
B-195 Certificate of Registration of GPU PowerNet Investments Pty. Ltd. dated
as of December 9, 1997 -incorporated by reference to Exhibit B-203 to
GPU, Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-
126.
B-196 Memorandum and Articles of Association of GPU PowerNet Investments Pty.
Ltd. dated as of December 8, 1997 - incorporated by reference to
Exhibit B-204 to GPU, Inc.'s Annual Report on Form U5S for the year
1997, File No. 30-126.
B-197 Certificate of Amendment to the Certificate of Registration of EI
Australia Services Pty. Ltd. to GPU International Australia Pty. Ltd.
dated as of October 14, 1996 - incorporated by reference to Exhibit B-
205 to GPU, Inc.'s Annual Report on Form U5S for the year 1997, File
No. 30-126.
B-198 Certificate of Incorporation of GPU Capital,Inc., dated October 8,
1998.
B-199 By-Laws of GPU Capital, Inc. adopted as of October 8, 1998.
B-200 Articles of Association of GPU DO Brasil Ltda., dated March 10, 1998.
B-201 By-Laws of GPU SAO Paulo S.A. adopted as of March 10, 1998.
B-202 Memorandum and Articles of Association of GPU GasNet Pty. Ltd. dated as
of June 16, 1998.
B-203 Memorandum and Articles of Association of GPU GasNet Trading Pty. Ltd.
dated as of June 16, 1998.
B-204 Certificate of Incorporation of Geddes II Corp., dated June 24, 1998.
B-205 By-Laws of Geddes II Corp., adopted as of June 24, 1998.
86
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
B-206 Articles of Association of Midlands Power International Limited, dated
April 3, 1995.
B-207 Certificate of Incorporation of GPU Brasil, Inc., dated February 25,
1998.
B-208 By-Laws of GPU Brasil, Inc., adopted as of February 25, 1998.
B-209 Certificate of Incorporation of GPU International Asia, Inc., dated
January 9, 1997.
B-210 By-Laws of GPU International Asia, Inc., adopted as of January 10,
1997.
B-211 Certificate of Incorporation of GPU Argentina Holdings, Inc., dated
December 18, 1998.
B-212 By-Laws of GPU Argentina Holdings, Inc., adopted as of December 18,
1998.
B-213 Certificate of Incorporation of GPU Solar, Inc., dated November 5,
1997.
B-214 By-Laws of GPU Solar, Inc., adopted as of November 5, 1997.
B-215 Certificate of Merger of GPU Solar, L.L.C. and GPU Solar, Inc., dated
January 7, 1997.
87
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU, GPUS & GPUN
----------------
C-1 Credit Agreement between GPUS and First National Bank of Chicago, dated
as of March 27, 1996 incorporated by reference to Exhibit B-2,
Certificate Pursuant to Rule 24, File No. 70-8793.
C-2 GPU, Inc. Restricted Stock Plan for Outside Directors dated June 4,
1998 - incorporated by reference to Exhibit 10-O to GPU, Inc.'s Annual
Report on Form 10-K for the year 1998, File No. 1-6047.
C-3 GPU, Inc. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
as amended and restated to reflect amendments through March 5,1998-
incorporated by reference to Exhibit 10-AA to GPU, Inc.'s Annual Report
on Form 10K for the year 1998, File No. 1-6047.
C-4 Performance Units Agreement Under the 1990 Stock Plan for Employees of
GPU and Subsidiaries - 1998 Agreement - incorporated by reference to
Exhibit 10-CC to GPU, Inc.'s Annual Report on Form 10K for the year
1998, File No. 1-6047.
C-5 Incentive Compensation Plan for Elected Officers of GPU Service, Inc.,
as amended and restated June 4, 1998.
C-6 Incentive Compensation Plan for Elected Officers of GPU Nuclear, Inc.,
dated as of February 6, 1997 incorporated by reference to Exhibit C-6
to GPU, Inc.'s Annual Report on Form U5S for the year 1996, File No.
30-126.
C-7 Incentive Compensation Plan for Elected Officers of GPU Generation,
Inc., dated as of February 6, 1997 incorporated by reference to Exhibit
C-7 to GPU, Inc.'s Annual Report on Form U5S for the year 1996, File
No. 30-126.
C-8 Employee Incentive Compensation Plan of GPU Service, Inc., dated as of
December 1, 1998.
C-9 Employee Incentive Compensation Plan of GPU Nuclear Inc., dated as of
April 1, 1995 - incorporated by reference to Exhibit C-8 to GPU Inc.'s
Annual Report on Form U5S for the year 1995, File No. 30-126.
C-10 GPU Service, Inc. Supplemental and Excess Benefits Plan, as amended
August 3, 1998.
C-11 GPU Nuclear, Inc. Supplemental and Excess Benefits Plan, as amended
June 5, 1997 - incorporated by reference to Exhibit C-11 to GPU, Inc.'s
Annual Report on Form U5S for the year 1997, File No. 30-126.
C-12 GPU Generation, Inc. Supplemental and Excess Benefits Plan, dated as
amended June 5, 1997 - incorporated by reference to Exhibit C-12 to
GPU, Inc.'s Annual Report on Form U5S for the year 1997, File No.
30-126.
88
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU, GPUS & GPUN
----------------
C-13 Deferred Remuneration Plan for Outside Directors of GPU, Inc. as
amended October 8, 1997 - incorporated by reference to Exhibit 10-S to
GPU, Inc.'s Annual Report on Form 10-K for the year 1997, File No.
1-6047.
C-14 Deferred Remuneration Plan for Outside Directors of GPU Nuclear Inc.,
as amended June 5, 1997 -incorporated by reference to Exhibit C-14 to
GPU, Inc.'s Annual Report on Form U5S for the year 1997, File No. 30-
126.
C-15 Retirement Plan for Outside Directors of GPU, Inc. dated June 5, 1997 -
incorporated by reference to Exhibit 10-R to GPU, Inc.'s Annual Report
on Form 10-K for the year 1997, File No. 1-6047.
C-16 GPU System Companies Deferred Compensation Plan dated June 5, 1997 -
incorporated by reference to Exhibit 10-A to GPU, Inc.'s Annual Report
on Form 10-K for the year 1997, File No. 1-6047.
C-17 GPU System Companies Master Directors' Benefits Protection Trust dated
February 6, 1997 - incorporated by reference to Exhibit C-17 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
C-18 GPU System Companies Master Executives' Benefits Protection Trust dated
February 6, 1997 - incorporated by reference to Exhibit C-18 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
C-19 Senior Executive Life Insurance Program, dated as of May 3, 1989 -
incorporated by reference to description contained on pages 13-14 of
GPU, Inc.'s 1992 definitive proxy statement, File No. 1-6047.
C-20 Supplemental Extraordinary Medical Expense Plan for Certain GPU System
Officers, as amended through February 28, 1992 - incorporated by
reference to Exhibit 10-M to GPU, Inc.'s Annual Report on Form 10-K for
the year 1992, File No. 1-6047.
C-21 Deferred Stock Unit Plan for Outside Directors of GPU, Inc., dated as
of July 1, 1997 - incorporated by reference to GPU, Inc.'s Annual
Report on Form U5S for the year 1997, File No. 30-126.
C-22 Form of 1998 Stock Option Agreement under the 1990 Stock Plan for
Employees of GPU, Inc. and Subsidiaries - incorporated by reference to
Exhibit 10-BB to GPU, Inc.'s Annual Report on Form 10-K for the year
1998, File No. 1-6047.
C-23 Severance Protection Agreement for Robert L. Wise, dated June 5, 1997 -
incorporated by reference to GPU, Inc.'s June 30, 1998 Quarterly Report
on Form 8K, File No. 1-6047.
89
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU, GPUS & GPUN
----------------
C-24 Severance Protection Agreement for Fred D. Hafer, dated November 5,
1998.
C-25 Severance Protection Agreement for Ira H. Jolles, dated November 5,
1998.
C-26 Severance Protection Agreement for Thomas G. Broughton, dated November
5, 1998.
C-27 Severance Protection Agreement for Carole B. Snyder, dated November 30,
1998.
C-28 Severance Protection Agreement for Bruce L. Levy, dated December 16,
1998.
C-29 Severance Protection Agreement for Dennis P. Baldassari, dated January
1, 1999.
C-30 Purchase and Sale Agreement by and among JCP&L, Met-Ed as sellers, GPU,
Inc, and Sithe Energies, Inc., as buyer, dated as of October 29, 1998 -
incorporated by reference to Exhibit 10-MM, to GPU, Inc.'s Annual
Report on Form 10-K for the year 1998, File No. 1-6047.
C-31 TMI Unit 1 Nuclear Generating Facility Asset Purchase Agreement by and
among GPUN, JCP&L, Met-Ed, and Penelec as sellers, and Amergen Energy
Company, LLC, as buyer dated as of October 15, 1998 incorporated by
reference to Exhibit 10-QQ to GPU, Inc.'s Annual Report on Form 10-K
for the year 1998, File No. 1-6047.
C-32 Voluntary Enhanced Retirement Program Agreement for Nonbargaining
Employees - Robert L. Wise, dated as of September 17, 1998 -
incorporated by reference to Exhibit 10-PP to GPU, Inc.'s Annual Report
on Form 10-K for the year 1998, File No. 1-6047.
C-33 Letter agreement dated August 7, 1997 relating to terms of employment
and pension benefits for I. H. Jolles - Incorporated by reference to
Exhibit 10-O, 1997 Annual Report on Form 10-K, SEC File No. 1-6047.
JCP&L
-----
Instruments Defining the Rights of Security Holders, Including
--------------------------------------------------------------
Indentures
----------
C-34 Indenture, dated as of March 1, 1946, with United States Trust Company
of New York, Successor Trustee, incorporated by reference to JCP&L's
Instruments of Indebtedness No. 1 filed as part of Amendment No. 1 to
GPU, Inc.'s Annual Report on Form U5S for the year 1959, File Nos.
30-126 and 1-3292.
90
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
C-35 First Supplemental Indenture, dated as of December 1, 1948 -
incorporated by reference to JCP&L's Instruments of Indebtedness No. 2
filed as part of Amendment No. 1 to GPU, Inc.'s Annual Report on Form
U5S for the year 1959, File Nos. 30-126 and 1-3292.
C-36 Second Supplemental Indenture, dated as of April 1, 1953 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 3 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-37 Third Supplemental Indenture, dated as of June 1, 1954 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 4 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-38 Fourth Supplemental Indenture, dated as of May 1, 1955 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 5 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-39 Fifth Supplemental Indenture, dated as of August 1, 1956 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 6 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-40 Sixth Supplemental Indenture, dated as of July 1, 1957 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 7 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-41 Seventh Supplemental Indenture, dated as of July 1, 1959 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 9 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-42 Eighth Supplemental Indenture, dated as of June 1, 1960 - incorporated
by reference to JCP&L's Instruments of Indebtedness No. 10 filed as
part of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for
the year 1959, File Nos. 30-126 and 1-3292.
C-43 Ninth Supplemental Indenture, dated as of November 1, 1962 -
incorporated by reference to Exhibit 2-C, Registration No. 2-20732.
C-44 Tenth Supplemental Indenture, dated as of October 1, 1963 -incorporated
by reference to Exhibit 2-C, Registration No. 2-21645.
C-45 Eleventh Supplemental Indenture, dated as of October 1, 1964 -
incorporated by reference to Exhibit 5-A-3, Registration No. 2-59785.
91
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
C-46 Twelfth Supplemental Indenture, dated as of November 1, 1965 -
incorporated by reference to Exhibit 5-A-4, Registration No. 2-59785.
C-47 Thirteenth Supplemental Indenture, dated as of August 1, 1966 -
incorporated by reference to Exhibit 4-C, Registration No. 2-25124.
C-48 Fourteenth Supplemental Indenture, dated as of September 1, 1967 -
incorporated by reference to Exhibit 5-A-6, Registration No. 2-59785.
C-49 Fifteenth Supplemental Indenture, dated as of October 1, 1968 -
incorporated by reference to Exhibit 5-A-7, Registration No. 2-59785.
C-50 Sixteenth Supplemental Indenture, dated as of October 1, 1969 -
incorporated by reference to Exhibit 5-A-8, Registration No. 2-59785.
C-51 Seventeenth Supplemental Indenture, dated as of June 1, 1970 -
incorporated by reference to Exhibit 5-A-9, Registration No. 2-59785.
C-52 Eighteenth Supplemental Indenture, dated as of December 1, 1970 -
incorporated by reference to Exhibit 5-A-10, Registration No. 2-59785.
C-53 Nineteenth Supplemental Indenture, dated as of February 1, 1971 -
incorporated by reference to Exhibit 5-A-11, Registration No. 2-59785.
C-54 Twentieth Supplemental Indenture, dated as of November 1, 1971 -
incorporated by reference to Exhibit 5-A-12, Registration No. 2-59875.
C-55 Twenty-first Supplemental Indenture, dated as of August 1, 1972 -
incorporated by reference to Exhibit 5-A-13, Registration No. 2-59785.
C-56 Twenty-second Supplemental Indenture, dated as of August 1, 1973 -
incorporated by reference to Exhibit 5-A-14, Registration No. 2-59785.
C-57 Twenty-third Supplemental Indenture, dated as of October 1, 1973 -
incorporated by reference to Exhibit 5-A-15, Registration No. 2-59785.
C-58 Twenty-fourth Supplemental Indenture, dated as of December 1, 1973 -
incorporated by reference to Exhibit 5-A-16, Registration No. 2-59785.
C-59 Twenty-fifth Supplemental Indenture, dated as of November 1, 1974 -
incorporated by reference to Exhibit 5-A-17, Registration No. 2-59785.
C-60 Twenty-sixth Supplemental Indenture, dated as of March 1, 1975 -
incorporated by reference to Exhibit 5-A-18, Registration No. 2-59785.
C-61 Twenty-seventh Supplemental Indenture, dated as of July 1, 1975 -
incorporated by reference to Exhibit 5-A-19, Registration No. 2-59785.
C-62 Twenty-eighth Supplemental Indenture, dated as of October 1, 1975 -
incorporated by reference to Exhibit 5-A-20, Registration No. 2-59785.
92
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
C-63 Twenty-ninth Supplemental Indenture, dated as of February 1, 1976 -
incorporated by reference to Exhibit 5-A-21, Registration No. 2-59785.
C-64 Supplemental Indenture No. 29A, dated as of May 31, 1976 - incorporated
by reference to Exhibit 5-A-22, Registration No. 2-59785.
C-65 Thirtieth Supplemental Indenture, dated as of June 1, 1976 -
incorporated by reference to Exhibit 5-A-23, Registration No. 2-59785.
C-66 Thirty-first Supplemental Indenture, dated as of May 1, 1977 -
incorporated by reference to Exhibit 5-A-24, Registration No. 2-59785.
C-67 Thirty-second Supplemental Indenture, dated as of January 20, 1978 -
incorporated by reference to Exhibit 5-A-25, Registration No. 2-60438.
C-68 Thirty-third Supplemental Indenture, dated as of January 1, 1979 -
incorporated by reference to Exhibit A-20(b), Certificate Pursuant to
Rule 24, File No. 70-6242.
C-69 Thirty-fourth Supplemental Indenture, dated as of June l, 1979 -
incorporated by reference to Exhibit A-28, Certificate Pursuant to Rule
24, File No. 70-6290.
C-70 Thirty-sixth Supplemental Indenture, dated as of October 1, 1979 -
incorporated by reference to Exhibit A-30, Certificate Pursuant to Rule
24, File No. 70-6354.
C-71 Thirty-seventh Supplemental Indenture, dated as of September 1, 1984 -
incorporated by reference to Exhibit A-1(cc), Certificate Pursuant to
Rule 24, File No. 70-7001.
C-72 Thirty-eighth Supplemental Indenture, dated as of July 1, 1985 -
incorporated by reference to Exhibit A-1(dd), Certificate Pursuant to
Rule 24, File No. 70-7109.
C-73 Thirty-ninth Supplemental Indenture, dated as of April 1, 1988 -
incorporated by reference to Exhibit A-1(a), Certificate Pursuant to
Rule 24, File No. 70-7263.
C-74 Fortieth Supplemental Indenture, dated as of June 14, 1988 -
incorporated by reference to Exhibit A-1(ff), Certificate Pursuant to
Rule 24, File No. 70-7603.
C-75 Forty-first Supplemental Indenture, dated as of April 1, 1989 -
incorporated by reference to Exhibit A-1(gg), Certificate Pursuant to
Rule 24, File No. 70-7603.
C-76 Forty-second Supplemental Indenture, dated as of July 1, 1989 -
incorporated by reference to Exhibit A-1(hh), Certificate Pursuant to
Rule 24, File No. 70-7603.
93
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
C-77 Forty-third Supplemental Indenture, dated as of March 1, 1991
-incorporated by reference to Exhibit 4-A-35, Registration No.
33-45314.
C-78 Forty-fourth Supplemental Indenture, dated as of March 1, 1992 -
incorporated by reference to Exhibit 4-A-36, Registration No. 33-49405.
C-79 Forty-fifth Supplemental Indenture, dated as of October 1, 1992 -
incorporated by reference to Exhibit 4-A-37, Registration No. 33-49405.
C-80 Forty-sixth Supplemental Indenture, dated as of April 1, 1993 -
incorporated by reference to Exhibit C-15 to GPU, Inc.'s Annual Report
on Form U5S for the year 1992, File No. 30-126.
C-81 Forty-seventh Supplemental Indenture, dated as of April 10, 1993 -
incorporated by reference to Exhibit C-16 to GPU, Inc.'s Annual Report
on Form U5S for the year 1992, File No. 30-126.
C-82 Forty-eighth Supplemental Indenture, dated as of April 15, 1993 -
incorporated by reference to Exhibit C-17 to GPU, Inc.'s Annual Report
on Form U5S for the year 1992, File No. 30-126.
C-83 Forty-ninth Supplemental Indenture, dated as of October 1, 1993 -
incorporated by reference to Exhibit C-18 to GPU, Inc.'s Annual Report
on Form U5S for the year 1993, File No. 30-126.
C-84 Fiftieth Supplemental Indenture, dated as of August 1, 1994 -
incorporated by reference to Exhibit C-19 of GPU, Inc.'s Annual Report
on Form U5S for the year 1994, File No. 30-126.
C-85 Fifty-first Supplemental Indenture of JCP&L, dated August 15, 1996 -
incorporated by reference to Exhibit 4-A-43 of GPU, Inc.'s Annual
Report on Form 10-K for 1996, File No. 1-6047.
C-86 Subordinated Debenture Indenture, dated as of May 1, 1995 -
incorporated by reference to Exhibit A-8(a), Certificate Pursuant to
Rule 24, File No. 70-8495.
Other
-----
C-87 Incentive Compensation Plan for Elected Officers of JCP&L dated
February 6, 1997 incorporated by reference to Exhibit C-74 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
C-88 Employee Incentive Compensation Plan of JCP&L, dated as of April 1,
1995 - incorporated by reference to Exhibit 10-D to GPU, Inc.'s Annual
Report on Form 10-K for the year 1995, File No. 1-6047.
C-89 JCP&L Supplemental and Excess Benefits Plan dated June 5, 1997 -
incorporated by reference to Exhibit 10-K to JCP&L's Annual Report on
Form 10-K for the year 1997, File No. 1-3141.
94
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
JCP&L
-----
C-90 Deferred Remuneration Plan for Outside Directors of JCP&L dated June 5,
1997 - incorporated by reference to Exhibit 10-J to JCP&L's Annual
Report on Form 10-K for the year 1997, File No. 1-3141.
C-91 Second Amended and Restated Nuclear Material Lease Agreement, dated as
of November 5, 1998, between Oyster Creek Fuel Corp. and JCP&L -
incorporated by reference to Exhibit 10-R, to JCP&L's Annual Report on
Form 10-K for the year 1998, File No. 1-3141.
C-92 Second Amended and Restated Nuclear Material Lease Agreement, dated as
of November 5, 1998, between TMI-1 Fuel Corp. and JCP&L - incorporated
by reference to Exhibit 10-S, to JCP&L's Annual Report on Form 10-K for
the year 1998, File No. 1-3141.
C-93 Letter Agreement, dated as of November 5, 1998, from JCP&L relating to
Oyster Creek Nuclear Material Lease Agreement - incorporated by
reference to Exhibit 10-T, to JCP&L's Annual Report on Form 10-K for
the year 1998, File No. 1-3141.
C-94 Letter Agreement, dated as of November 5, 1998, from JCP&L relating to
JCP&L TMI-1 Nuclear Material Lease Agreement - incorporated by
reference to Exhibit 10-U, to JCP&L's Annual Report on Form 10-K for
the year 1998, File No. 1-3141.
C-95 Second Amended and Restated Trust Agreement, dated as of November 5,
1998, between United States Trust Company of New York, as Owner
Trustee, Lord Fuel Corp., as Trustor and Beneficiary, and JCP&L and its
affiliates - incorporated by reference to Exhibit 10-V, to JCP&L's
Annual Report on Form 10-K for the year 1998, File No. 1-3141.
C-96 Purchase and Sale Agreement by and between JCP&L, as seller, and Sithe
Energies, Inc., as buyer, dated as of October 29, 1998 - incorporated
by reference to Exhibit 10-LL, to JCP&L's Annual Report on Form 10-K
for the year 1998, File No. 1-3141.
C-97 TMI Unit 1 Nuclear Generating Facility Asset Purchase Agreement by and
among JCP&L and affiliates as sellers, and Amergen Energy Company, LLC,
as buyer dated as of October 15, 1998 - incorporated by reference to
Exhibit 10-QQ to JCP&L`s Annual Report on Form 10-K for the year 1998,
File No. 1-3141.
C-98 Purchase and Sale Agreement by and among JCP&L, Met-Ed as sellers, GPU,
Inc, and Sithe Energies, Inc., as buyer, dated as of October 29, 1998 -
incorporated by reference to Exhibit 10-MM, to JCP&L's Annual Report on
Form 10-K for the year 1998, File No. 1-3141.
95
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Met-Ed
------
Instruments Defining the Rights of Security Holders, Including
--------------------------------------------------------------
Indentures
----------
C-99 Indenture, dated as of November 1, 1944, with United States Trust
Company of New York, Successor Trustee, - incorporated by reference to
Met-Ed's Instruments of Indebtedness No. 1 filed as part of Amendment
No. l to GPU, Inc.'s Annual Report on Form U5S for the year 1959, File
Nos. 30-126 and 1-3292.
C-100 Supplemental Indenture, dated as of February 1, 1947 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 2 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-101 Supplemental Indenture, dated as of May 20, 1947 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 3 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-102 Supplemental Indenture, dated as of September 1, 1947 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 4 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-103 Supplemental Indenture, dated as of September 1, 1948 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 5 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-104 Supplemental Indenture, dated as of October 4, 1949 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 6 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-105 Supplemental Indenture, dated as of February 1, 1950 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 7 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-106 Supplemental Indenture, dated as of July 19, 1950 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 8 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-107 Supplemental Indenture, dated as of December 1, 1950 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 9 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
96
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Met-Ed
------
C-108 Supplemental Indenture, dated as of March 1, 1952 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 10 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-109 Supplemental Indenture, dated as of May 1, 1953 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 11 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-110 Supplemental Indenture, dated as of July 1, 1954 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 12 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-111 Supplemental Indenture, dated as of October 1, 1954 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 13 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-112 Supplemental Indenture, dated as of June 1, 1957 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 14 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-113 Supplemental Indenture, dated as of May 1, 1960 - incorporated by
reference to Met-Ed's Instruments of Indebtedness No. 16 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-114 Supplemental Indenture, dated as of December 1, 1962 - incorporated by
reference to Exhibit 2-E(1), Registration No. 2-59678.
C-115 Supplemental Indenture, dated as of March 20, 1964 - incorporated by
reference to Exhibit 2-E(2), Registration No. 2-59678.
C-116 Supplemental Indenture, dated as of July 1, 1965 - incorporated by
reference to Exhibit 2-E(3), Registration No. 2-59678.
C-117 Supplemental Indenture, dated as of June 1, 1966 - incorporated by
reference to Exhibit 2-B-4, Registration No. 2-24883.
C-118 Supplemental Indenture, dated as of March 22, 1968 - incorporated by
reference to Exhibit 4-C-5, Registration No. 2-29644.
C-119 Supplemental Indenture, dated as of September 1, 1968 - incorporated by
reference to Exhibit 2-E(6), Registration No. 2-59678.
97
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Met-Ed
------
C-120 Supplemental Indenture, dated as of August 1, 1969 - incorporated by
reference to Exhibit 2-E(7), Registration No. 2-59678.
C-121 Supplemental Indenture, dated as of November 1, 1971 - incorporated by
reference to Exhibit 2-E(8), Registration No. 2-59678.
C-122 Supplemental Indenture, dated as of May 1, 1972 - incorporated by
reference to Exhibit 2-E(9), Registration No. 2-59678.
C-123 Supplemental Indenture, dated as of December 1, 1973 - incorporated by
reference to Exhibit 2-E(10), Registration No. 2-59678.
C-124 Supplemental Indenture, dated as of October 30, 1974 - incorporated by
reference to Exhibit 2-E(11), Registration No. 2-59678.
C-125 Supplemental Indenture, dated as of October 31, 1974 - incorporated by
reference to Exhibit 2-E(12), Registration No. 2-59678.
C-126 Supplemental Indenture, dated as of March 20, 1975 - incorporated by
reference to Exhibit 2-E(13), Registration No. 2-59678.
C-127 Supplemental Indenture, dated as of September 25, 1975 - incorporated
by reference to Exhibit 2-E(15), Registration No. 2-59678.
C-128 Supplemental Indenture, dated as of January 12, 1976 - incorporated by
reference to Exhibit 2-E(16), Registration No. 2-59678.
C-129 Supplemental Indenture, dated as of March 1, 1976 - incorporated by
reference to Exhibit 2-E(17), Registration No. 2-59678.
C-130 Supplemental Indenture, dated as of September 28, 1977 - incorporated
by reference to Exhibit 2-E(18), Registration No. 2-62212.
C-131 Supplemental Indenture, dated as of January 1, 1978 - incorporated by
reference to Exhibit 2-E(19), Registration No. 2-62212.
C-132 Supplemental Indenture, dated as of September 1, 1978 - incorporated by
reference to Exhibit 4-A(19), Registration No. 33-48937.
C-133 Supplemental Indenture, dated as of June 1, 1979 - incorporated by
reference to Exhibit 4-A(20), Registration No. 33-48937.
C-134 Supplemental Indenture, dated as of January l, 1980 - incorporated by
reference to Exhibit 4-A(21), Registration No. 33-48937.
C-135 Supplemental Indenture, dated as of September 1, 1981 - incorporated by
reference to Exhibit 4-A(22), Registration No. 33-48937.
98
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Met-Ed
------
C-136 Supplemental Indenture, dated as of September 10, 1981 - incorporated
by reference to Exhibit 4-A(23), Registration No. 33-48937.
C-137 Supplemental Indenture, dated as of December 1, 1982 - incorporated by
reference to Exhibit 4-A(24), Registration No. 33-48937.
C-138 Supplemental Indenture, dated as of September 1, 1983 - incorporated by
reference to Exhibit 4-A(25), Registration No. 33-48937.
C-139 Supplemental Indenture dated as of September 1, 1984 - incorporated by
reference to Exhibit 4-A(26), Registration No. 33-48937.
C-140 Supplemental Indenture, dated as of March 1, 1985 - incorporated by
reference to Exhibit 4-A(27), Registration No. 33-48937.
C-141 Supplemental Indenture, dated as of September l, 1985 - incorporated by
reference to Exhibit 4-A(28), Registration No. 33-48937.
C-142 Supplemental Indenture, dated as of June 1, 1988 - incorporated by
reference to Exhibit 4-A(29), Registration No. 33-48937.
C-143 Supplemental Indenture, dated as of April 1, 1990 - incorporated by
reference to Exhibit 4-A(30), Registration No. 33-48937.
C-144 Amendment, dated as of May 22, 1995, to Supplemental Indenture (dated
April 1, 1990) - incorporated by reference to Exhibit 4-A(31),
Registration No. 33-48937.
C-145 Supplemental Indenture, dated as of September 1, 1992 - incorporated by
reference to Exhibit 4-A(32)(a), Registration No. 33-48937.
C-146 Supplemental Indenture, dated as of December 1, 1993 - incorporated by
reference to Exhibit C-58 to GPU, Inc.'s Annual Report on Form U5S for
the year 1993, File No. 30-126.
C-147 Supplemental Indenture, dated as of July 15, 1995 - incorporated by
reference to Exhibit 4-B-35 to Met-Ed's Annual Report on Form 10-K for
the year 1995, File No. 1-446.
C-148 Supplemental Indenture, dated August 15, 1996 - incorporated by
reference to Exhibit 4-B-35 to Met-Ed's Annual Report on Form 10-K for
1996, File No. 1-446.
C-149 Supplemental Indenture, dated May 1, 1997 - incorporated by reference
to Exhibit 4-B-36 to Met-Ed's Annual Report on Form 10-K for 1997, File
No. 1-4446.
C-150 Subordinated Debenture Indenture, dated as of August 1, 1994 -
incorporated by reference to Exhibit A-8(a), Certificate Pursuant to
Rule 24, File No. 70-8401.
99
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Other
-----
C-151 Incentive Compensation Plan for Elected Officers of Met-Ed dated
February 6, 1997 - incorporated by reference to Exhibit C-134 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File NO. 30-126.
C-152 Employee Incentive Compensation Plan of Met-Ed, dated as of April 1,
1995 - incorporated by reference to Exhibit 10-E to GPU, Inc.'s Annual
Report on Form 10-K for the year 1995, File No. 1-6047.
C-153 Met-Ed Supplemental and Excess Benefits Plan dated June 5, 1997 -
incorporated by reference to Exhibit 10-L to Met-Ed's Annual Report on
Form 10-K for the year 1997, File No. 1-446.
C-154 Second Amended and Restated Nuclear Material Lease Agreement, dated as
of November 5, 1998, between TMI-1 Fuel Corp. and Met-Ed - incorporated
by reference to Exhibit 10-W, to Met-Ed's Annual Report on Form 10-K
for the year 1998, File No. 1-446.
C-155 Letter Agreement, dated as of November 5, 1998, from Met-Ed relating to
Met-Ed TMI-1 Nuclear Material Lease Agreement - incorporated by
reference to Exhibit 10-X, to Met-Ed's Annual Report on Form 10-K for
the year 1998, File No. 1-446.
C-156 Second Amended and Restated Trust Agreement, dated as of November 5,
1998, between United States Trust Company of New York, as Owner
Trustee, Lord Fuel Corp., as Trustor and Beneficiary, and Met-Ed and
its affiliates - incorporated by reference to Exhibit 10-V, to Met-Ed's
Annual Report on Form 10-K for the year 1998, File No. 1-446.
C-157 Purchase and Sale Agreement by and between Met-Ed, as seller, and Sithe
Energies, Inc., as buyer, dated as of October 29, 1998 - incorporated
by reference to Exhibit 10-NN, to Met-Ed's Annual Report on Form 10-K
for the year 1998, File No. 1-446.
C-158 TMI Unit 1 Nuclear Generating Facility Asset Purchase Agreement by and
among Met-Ed and affiliates as sellers, and Amergen Energy Company,
LLC, as buyer dated as of October 15, 1998 - incorporated by reference
to Exhibit 10-QQ to Met-Ed's Annual Report on Form 10-K for the year
1998, File No. 1-446.
C-159 Purchase and Sale Agreement by and among JCP&L, Met-Ed as sellers, GPU,
Inc, and Sithe Energies, Inc., as buyer, dated as of October 29, 1998 -
incorporated by reference to Exhibit 10-MM, to Met-Ed's Annual Report
on Form 10-K for the year 1998, File No. 1-446.
100
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
Instruments Defining the Rights of Security Holders, Including
--------------------------------------------------------------
Indentures
----------
C-160 Mortgage and Deed of Trust, dated as of January 1, 1942, with United
States Trust Company of New York, Successor Trustee, - incorporated by
reference to Penelec's Instruments of Indebtedness No. 1 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-161 Supplemental Indenture, dated as of March 7, 1942 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 2 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-162 Supplemental Indenture, dated as of April 28, 1943 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 3 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-163 Supplemental Indenture, dated as of August 20, 1943 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 4 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-164 Supplemental Indenture, dated as of August 30, 1943 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 5 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-165 Supplemental Indenture, dated as of August 31, 1943 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 6 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-166 Supplemental Indenture, dated as of April 26, 1944 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 7 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-167 Supplemental Indenture, dated as of April 19, 1945 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 8 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-168 Supplemental Indenture, dated as of October 25, 1945 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 9 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
101
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
C-169 Supplemental Indenture, dated as of June 1, 1946 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 10 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-170 Supplemental Indenture, dated as of November 1, 1949 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 11 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-171 Supplemental Indenture, dated as of October 1, 1951 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 12 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-172 Supplemental Indenture, dated as of August 1, 1952 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 13 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-173 Supplemental Indenture, dated as of June 1, 1953 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 14 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-174 Supplemental Indenture, dated as of March 1, 1954 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 15 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-175 Supplemental Indenture, dated as of April 30, 1956 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 16 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-176 Supplemental Indenture, dated as of May 1, 1956 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 17 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-177 Supplemental Indenture, dated as of March 1, 1958 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 18 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-178 Supplemental Indenture, dated as of August 1, 1959 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 19 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
102
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
C-179 Supplemental Indenture, dated as of May 1, 1960 - incorporated by
reference to Penelec's Instruments of Indebtedness No. 20 filed as part
of Amendment No. 1 to GPU, Inc.'s Annual Report on Form U5S for the
year 1959, File Nos. 30-126 and 1-3292.
C-180 Supplemental Indenture, dated as of May 1, 1961 - incorporated by
reference to Exhibit 2-D(1), Registration No. 2-61502.
C-181 Supplemental Indenture, dated as of October 1, 1964 - incorporated by
reference to Exhibit 2-D(2), Registration No. 2-61502.
C-182 Supplemental Indenture, dated as of November 1, 1966 - incorporated by
reference to Exhibit 2-D(3), Registration No. 2-61502.
C-183 Supplemental Indenture, dated as of June 1, 1967 - incorporated by
reference to Exhibit 2-D(4), Registration No. 2-61502.
C-184 Supplemental Indenture, dated as of August 1, 1968 - incorporated by
reference to Exhibit 2-D(5), Registration No. 2-61502.
C-185 Supplemental Indenture, dated as of May 1, 1969 - incorporated by
reference to Exhibit 2-D(6), Registration No. 2-61502.
C-186 Supplemental Indenture, dated as of April 1, 1970 - incorporated by
reference to Exhibit 2-D(7), Registration No. 2-61502.
C-187 Supplemental Indenture, dated as of December 1, 1971 - incorporated by
reference to Exhibit 2-D(8), Registration No. 2-61502.
C-188 Supplemental Indenture, dated as of July 1, 1973 - incorporated by
reference to Exhibit 2-D(9), Registration No. 2-61502.
C-189 Supplemental Indenture, dated as of June 1, 1974 - incorporated by
reference to Exhibit 2-D(10), Registration No. 2-61502.
C-190 Supplemental Indenture, dated as of December 1, 1974 - incorporated by
reference to Exhibit 2-D(11), Registration No. 2-61502.
C-191 Supplemental Indenture, dated as of August 1, 1975 - incorporated by
reference to Exhibit 2-D(12), Registration No. 2-61502.
C-192 Supplemental Indenture, dated as of December 1, 1975 - incorporated by
reference to Exhibit 2-D(13), Registration No. 2-61502.
C-193 Supplemental Indenture, dated as of April 1, 1976 - incorporated by
reference to Exhibit 2-D(14), Registration No. 2-61502.
C-194 Supplemental Indenture, dated as of June 1, 1976 - incorporated by
reference to Exhibit 2-D(15), Registration No. 2-61502.
103
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Penelec
-------
C-195 Supplemental Indenture, dated as of July 1, 1976 - incorporated by
reference to Exhibit 2-D(16), Registration No. 2-61502.
C-196 Supplemental Indenture, dated as of November 1, 1976 - incorporated by
reference to Exhibit 2-D(17), Registration No. 2-61502.
C-197 Supplemental Indenture, dated as of November 30, 1977 - incorporated by
reference to Exhibit 2-D(18), Registration No. 2-61502.
C-198 Supplemental Indenture, dated as of December 1, 1977 - incorporated by
reference to Exhibit 2-D(19), Registration No. 2-61502.
C-199 Supplemental Indenture, dated as of June 1, 1978 - incorporated by
reference to Exhibit 4-A(2), Registration No. 33-49669.
C-200 Supplemental Indenture, dated as of June l, 1979 - incorporated by
reference to Exhibit 4-A(3), Registration No. 33-49669.
C-201 Supplemental Indenture, dated as of September 1, 1984 - incorporated by
reference to Exhibit 4-A(4), Registration No. 33-49669.
C-202 Supplemental Indenture, dated as of December 1, 1985 - incorporated by
reference to Exhibit 4-A(5), Registration No. 33-49669.
C-203 Supplemental Indenture, dated as of December 1, 1986, - incorporated by
reference to Exhibit 4-A(6), Registration No. 33-49669.
C-204 Supplemental Indenture, dated as of May 1, 1989 - incorporated by
reference to Exhibit 4-A(7), Registration No. 33-49669.
C-205 Supplemental Indenture, dated as of December 1, 1990 - incorporated by
reference to Exhibit 4-A(8), Registration No. 33-45312.
C-206 Supplemental Indenture, dated as of March 1, 1992 - incorporated by
reference to Exhibit 4-A(9), Registration No. 33-45312.
C-207 Supplemental Indenture, dated as of June 1, 1993 - incorporated by
reference to Exhibit C-73 to GPU, Inc.'s Annual Report on Form U5S for
the year 1993, File No. 30-126.
C-208 Supplemental Indenture, dated as of November 1, 1995 - incorporated by
reference to Exhibit 4-C-11 to GPU, Inc.'s Annual Report on Form 10-K
for the year 1995, File No. 1-6047.
C-209 Supplemental Indenture of Penelec dated August 15, 1996 - incorporated
by reference to Exhibit 4-C-12 to GPU, Inc.'s Annual Report on Form
10-K for 1996, File No. 1-6047.
C-210 Subordinated Debenture Indenture, dated as of July 1, 1994 -
incorporated by reference to Exhibit A-8(a), Certificate Pursuant to
Rule 24, File No. 70-8403.
104
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Other
-----
C-211 Incentive Compensation Plan for Elected Officers of Penelec dated
February 6, 1997 - incorporated by reference to Exhibit C-191 to GPU,
Inc.'s Annual Report on Form U5S for the year 1996, File No. 30-126.
C-212 Employee Incentive Compensation Plan of Penelec, dated as of April 1,
1995 - incorporated by reference to Exhibit 10-F to GPU, Inc.'s Annual
Report on Form 10-K for the year 1995, File No. 1-6047.
C-213 Penelec Supplemental and Excess Benefits Plan dated June 5, 1997 -
incorporated by reference to Exhibit 10-M to Penelec's Annual Report on
Form 10-K for the year 1996, File No. 1-3522.
C-214 Second Amended and Restated Nuclear Material Lease Agreement, dated as
of November 5, 1998, between TMI-1 Fuel Corp. and Penelec -
incorporated by reference to Exhibit 10-Y, to Penelec's Annual Report
on Form 10-K for the year 1998, File No. 1-3522.
C-215 Letter Agreement, dated as of November 5, 1998, from Penelec relating
to Penelec Nuclear Material Lease Agreement - incorporated by reference
to Exhibit 10-Z, to Penelec's Annual Report on Form 10-K for the year
1998, File No. 1-3522.
C-216 Second Amended and Restated Trust Agreement, dated as of November 5,
1998, between United States Trust Company of New York, as Owner
Trustee, Lord Fuel Corp., as Trustor and Beneficiary, and Penelec and
its affiliates - incorporated by reference to Exhibit 10-V, to
Penelec's Annual Report on Form 10-K for the year 1998, File No.
1-3522.
C-217 Homer City Electric Generating Station Asset Purchase Agreement by and
among Penelec, NGE Generation, Inc., and New York State Electric & Gas
Corporation, as sellers, and Mission Energy Westside, Inc., as buyer,
dated as of August 1, 1998 - incorporated by reference to Exhibit
10-KK, to Penelec's Annual Report on Form 10-K for the year 1998, File
No. 1-3522.
C-218 Purchase and Sale Agreement by and between Penelec, as seller, and
Sithe Energies, Inc., as buyer, dated as of October 29, 1998 -
incorporated by reference to Exhibit 10-OO, to Penelec's Annual Report
on Form 10-K for the year 1998, File No. 1-3522.
C-219 TMI Unit 1 Nuclear Generating Facility Asset Purchase Agreement by and
among Penelec and affiliates as sellers, and Amergen Energy Company,
LLC, as buyer dated as of October 15, 1998 - incorporated by reference
to Exhibit 10-QQ to Penelec's Annual Report on Form 10-K for the year
1998, File No. 1-3522.
105
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
GPU International Group
-----------------------
C-220 Annual Performance Award (APA) Plan of GPU International, Inc. as
amended and restated effective February 6, 1997 - incorporated by
reference to Exhibit C-197 to GPU, Inc.'s Annual Report on Form U5S for
the year 1996, File No. 30-26.
Other Exhibits
--------------
D-1 Tax Allocation Agreement as amended through March 31, 1996 -
incorporated by reference to Exhibit D-1 to GPU, Inc.'s Annual Report
on Form U5S for the year 1995, File No. 30-126.
Tax Allocation Agreement - Amendments thereto through December 31,
1998.
E-1 Venture Disclosures - Licensing of Computer Programs to Nonassociated
Companies.
E-2 Venture Disclosures - Fiber Optic System Lease Agreements with
Nonassociated Companies.
E-3 Venture Disclosures - Services to Non-Affiliated Utilities.
E-4 GPU International, Inc. Annual Report to the SEC on Form U-13-60 for
1998.
E-5 GPU Nuclear, Inc. - Policy for the Purchase of Computers for the
Nuclear Science Degree Program incorporated by reference to Exhibit E-1
to GPU, Inc.'s Annual Report on Form U5S for the year 1989, File No.
30-126.
E-6 GPU System Accounting Policy regarding Company Credit Card Agreements,
dated April 20, 1993 incorporated by reference to Exhibit E-3 to GPU,
Inc.'s Annual Report on Form U5S for the year 1992, File No. 30-126.
Schedules Supporting Items of This Report
- -----------------------------------------
F-1 Item 6. Part III - Compensation and other related information for the
Officers and Directors of GPU, JCP&L, Met-Ed and Penelec.
F-2 Consolidating Financial Statements of Jersey Central Power & Light
Company for 1998.
Consolidating Financial Statements of Metropolitan Edison Company for
1998.
Consolidating Financial Statements of Pennsylvania Electric Company for
1998.
106
<PAGE>
ITEM 10. FINANCIAL STATEMENTS AND EXHIBITS (Continued):
Exhibits
- --------
Schedules Supporting Items of This Report
- -----------------------------------------
G-1 Financial Data Schedule (for EDGAR filing only).
GPU, Inc. and Subsidiary Companies
Jersey Central Power & Light Company and Subsidiary Company
Metropolitan Edison Company and Subsidiary Companies
Pennsylvania Electric Company and Subsidiary Companies
H-1 Organizational chart showing the relationship of GPU International,
Inc. to each exempt wholesale generator (EWG) in which it holds an
interest.
Organizational chart showing the relationship of GPU Power, Inc. to
each exempt wholesale generator (EWG) in which it holds an interest.
Organizational chart showing the relationship of GPU Capital, Inc. to
each foreign utility company (FUCO) in which it holds an interest.
I-1 Consolidating Financial Statements of GPU International, Inc. for
1998 - filed pursuant to request for confidential treatment.
Consolidating Financial Statements of GPU Power, Inc. for 1998 - filed
pursuant to request for confidential treatment.
Consolidating Financial Statements of GPU Capital, Inc. for 1998 -filed
pursuant to request for confidential treatment.
Financial Statements of EI Services Canada, Ltd. for 1998 - filed
pursuant to request for confidential treatment.
Financial Statements of Selkirk Cogeneration Partners Limited
Partnership for 1998 - incorporated by reference to Selkirk
Cogeneration Partners Limited Partnership Annual Report on Form 10-K
for the year 1998, File No. 33-83618-01.
Financial Statements of Termobarranquilla S.A. for 1998 - filed
pursuant to request for confidential treatment.
Financial Statements of Los Amigos Leasing Company, Ltd. for 1998 -
filed pursuant to request for confidential treatment.
Consolidating Financial Statements of EI UK Holdings, Inc. for 1998 -
filed pursuant to request for confidential treatment.
Schedule XIV - Notes to Financial Statements and Schedule of Account
923 - Outside Services Employed of GPU International, Inc.'s Annual
Report to the SEC on Form U-13-60 for 1998 - filed pursuant to request
for confidential treatment.
107
<PAGE>
SIGNATURE
The undersigned system company has duly caused this annual report to be signed
on its behalf by the undersigned thereunto duly authorized pursuant to the
requirements of the Public Utility Holding Company Act of 1935.
GPU, INC.
April 30, 1999
By /s/ P. E. Maricondo
------------------------------------------
P. E. Maricondo, Vice President,
Comptroller and Chief Accounting Officer
108
<PAGE>
_________________________________________________________________________
_________________________________________________________________________
EXHIBIT B-12
GPU SERVICE, INC.
_________________
BY-LAWS
(As Amended January 1, 1999)
_________________
_________________________________________________________________________
_________________________________________________________________________
<PAGE>
(AS AMENDED JANUARY 1, 1999)
GPU SERVICE, INC.
BY-LAWS
OFFICES
-------
1. The principal office of the Corporation shall be in the County of Morris,
State of New Jersey. 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders 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 stockholders 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 stockholders 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 stockholders
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.
5. Except as otherwise provided by law or by the Articles of Incorporation,
as amended, 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
stockholders. 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
stockholders 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
1
<PAGE>
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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholder or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. At all elections of directors each
holder of record of shares of capital stock then entitled to vote, shall be
entitled to as many votes as shall equal the number of votes which (except for
such provision) he would be entitled to cast for the election of directors with
respect to his shares of stock multiplied by the number of directors to be
elected, and he may cast all such votes for a single director or may distribute
them among the number to be voted for, or any two or more of them, as he may see
fit. Except as otherwise provided by law or by the Articles of Incorporation, as
amended, each holder of record of shares of capital stock entitled to vote at
any meeting of stockholders shall be entitled to one vote for every share of
capital stock standing in his name on the books of the Corporation. 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 thereof, shall not be voted.
All elections shall be determined by a plurality vote, and, except as otherwise
provided by law or by the Articles of Incorporation, as amended, 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.
7. A complete list of the stockholders entitled to vote at any meeting of
stockholders, arranged in alphabetical order, with the residence of each, and
the number of shares held by each, shall 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 stockholder 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 stockholder.
8. Special meetings of the stockholders for any purpose or purposes, unless
otherwise prescribed by law, may be called by the Chairman or by the President,
and shall be called by the chief executive officer or Secretary at the request
in writing of any three members of the Board of Directors, or at the request in
writing of holders of record of ten percent of the shares of capital stock of
the Corporation issued and outstanding. Business transacted at all special
meetings of the stockholders shall be confined to the purposes stated in the
call.
9. (a) Notice of every meeting of stockholders, setting forth the time and
the place and briefly the purpose or purposes thereof, shall be mailed, not less
than ten nor more than fifty days prior to such meeting, to each stockholder of
record (at his address appearing on the stock books of the Corporation, unless
he shall have filed with the Secretary of the Corporation a written request that
notices intended for him 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
2
<PAGE>
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 by its
Board of Directors, or under the direction of the Board of Directors, which
shall consist of not less than three nor more than nine directors as shall be
fixed from time to time by a resolution adopted by a majority of the entire
Board of Directors, or by the consent of the shareholders, provided, however,
that no decrease in the number of directors constituting the entire Board of
Directors shall shorten the term of any incumbent director. Each director shall
be at least twenty-one years of age. Directors need not be stockholders of the
Corporation. Directors shall be elected at the annual meeting of stockholders,
or, if any such election shall not be held, at a stockholders' 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 stockholders and thereafter until his 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 stockholders.
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 corporation, partnership,
association, or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and
the Board in good faith authorizes the contract or transaction by a vote
sufficient for such purposes without counting the vote of the interested
director or directors; or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in
good faith by vote of the stockholders; 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 stockholders.
No director or officer shall be liable to account to the Corporation for
any profit realized by him from or through any such contract or transaction of
the Corporation by reason of his interest 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
3
<PAGE>
voidable or 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 stockholders. 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 his duties shall give notice either
personally or by telephone or telegraph 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 a majority of the directors in
office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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, as amended, or by the By-Laws.
17. 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
----------
4
<PAGE>
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 except such powers as the Board of Directors may exercise by virtue of
Section 11 of the By-Laws. The Executive Committee shall have no power to
revoke any action taken by the Board of Directors, and shall be subject to any
restriction imposed by law, by the By-Laws, or by the Board of Directors.
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, and 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 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.
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 and benefits for their services as
directors, at such rate or under such conditions 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 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 the Executive Committee or such other Committees
of the Board and of otherwise performing their duties as members of such
Committees.
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 President - Fossil
Generation, a President - Operations Division, a Comptroller, one or more
Assistant Secretaries, one or more Assistant
5
<PAGE>
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 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 person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity.
24. The salaries and other compensation of the officers of the Corporation
shall be determined from time to time by the chief executive officer, subject,
in the case of those officers who are also officers of GPU, Inc., to the
concurrence of the Board of Directors of that Corporation; and, in the case of
officers of the Operations Division or Fossil Generation who are also officers
of a subsidiary of GPU, Inc., to the approval of the respective subsidiary's
board of directors.
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, and perform such duties as shall be
determined from time to time by the Board of Directors.
26. The salary or other compensation of all employees other than officers of
the Corporation 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
stockholders 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 the directors 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, he shall
preside at all meetings of the Board at which he shall be present.
(b) If a Chairman shall be chosen by the Board of Directors and if he
shall be designated by the Board as chief executive officer of the Corporation,
(i) he 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;
6
<PAGE>
(ii) he 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) he 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 him and act and vote on behalf of
the Corporation at all meetings of stockholders of any corporation
in which the Corporation holds stock and grant any consent, waiver,
or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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 if he
shall not be designated by the Board as chief executive officer of the
Corporation,
(i) he 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;
(ii) he 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.
7
<PAGE>
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 he shall be
present.
(b) If the President shall be designated by the Board of Directors as
chief executive officer of the Corporation,
(i) he 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) he 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) he 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 him and act and vote on behalf of
the Corporation at all meetings of the stockholders of any
corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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
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;
8
<PAGE>
(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 him and act and vote on behalf of
the Corporation at all meetings of the stockholders 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 his opinion 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.
THE PRESIDENT - FOSSIL GENERATION
---------------------------------
29A. The President - Fossil Generation
(i) shall be the chief operating officer of the Fossil Generation
Division of the Corporation;
(ii) shall have supervision, direction and control of the conduct
of the business of the Fossil Generation Division of the Corporation,
subject, however, to the control of the President, 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 Fossil Generation Division of
the Corporation, and, when authorized to do so by the President, the Board of
Directors or the Executive Committee, if there be one, may sign in the name
and on behalf of the Fossil Generation Division of the Corporation any and
all contracts, agreements or other instruments of any nature pertaining to
the business of the Fossil Generation Division of the Corporation; and
(iv) 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 - OPERATIONS DIVISION
-----------------------------------
29B. The President - Operations Division
(i) shall be the chief operating officer of the Operations
Division of the Corporation;
(ii) shall have supervision, direction and control of the conduct
of the business of the Operations Division of the Corporation, subject,
however, to the control of the President, 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 Operations Division of the
9
<PAGE>
Corporation, and, when authorized to do so by the President, the Board of
Directors or the Executive Committee, if there be one, may sign in the name
and on behalf of the Operations Division of the Corporation any and all
contracts, agreements or other instruments of any nature pertaining to the
business of the Operations Division of the Corporation; and
(iv) 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 Directors and the Executive Committee, if there be one.
(b) He 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, 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) He 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 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 him and act and vote in behalf of the Corporation at all
meetings of the stockholders of any corporation in which the Corporation holds
stock and grant any consent, waiver or power of attorney in respect of such
stock.
(d) He 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) The Board of Directors may designate one or more of such Vice
Presidents as a Senior Vice President or 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.
10
<PAGE>
THE SECRETARY
-------------
31. (a) The Secretary shall attend all meetings of the Board of Directors
and all meetings of the stockholders and record all votes and the minutes of all
proceedings in books to be kept for that purpose; and he shall perform like
duties for the Executive Committee and any other committees created by the Board
of Directors.
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which notice
is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He 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 in 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) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
in his custody 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) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his transactions as Treasurer at
all regular meetings of the Board of
11
<PAGE>
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, he 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 his office, and for the
restoration to the Corporation in case of his death, resignation, retirement or
removal from office, of all books, papers, vouchers, money and other property of
whatever kind in his possession or under his control belonging to the
Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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 his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he 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 stockholders, if called upon to do so.
12
<PAGE>
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other powers and duties as may be conferred or required 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.
VACANCIES
---------
34. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office, 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 occurs. 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. Any 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 acceptance, 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 the total number of directors provided for in Section
10 of the By-Laws 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.
13
<PAGE>
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, on or after
January 27, 1987 unless the director has breached or failed to perform the
duties of his office under Section 8363 of the Pennsylvania Directors Liability
Act, 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 formal or informal, and whether brought by or in the right of the
Corporation or otherwise, by reason of the fact that he 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.
(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 he 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
14
<PAGE>
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 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 action in an
official capacity and as to action 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
stockholders 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may but need not be an officer
or employee of the Corporation, and by a registrar, the signatures of any such
Chairman, 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 such certificate shall have ceased to be such before such
certificate 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.
15
<PAGE>
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 stockholders 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 stockholders 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 stockholders of record at such time shall
be entitled to receive any such notice, dividend, distribution, rights or
interests.
REGISTERED STOCKHOLDERS
-----------------------
42. The Corporation shall be entitled to treat the holder of record 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
-------------------
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 stockholders), or any of them, shall be open to the inspection
of stockholders, and no stockholder 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 stockholders.
16
<PAGE>
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 Chairman or 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 Chairman or the President or a Vice
President and 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 facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
RECEIPTS FOR SECURITIES
-----------------------
46. All receipts for stocks, bonds or other securities received 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
17
<PAGE>
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.
DIRECTORS' ANNUAL STATEMENT
---------------------------
49. The Board of Directors shall present or cause to be presented at each
annual meeting of stockholders, and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
NOTICES
-------
50. (a) Whenever under the provisions of the By-Laws notice is required to
be given to any director, officer or stockholder, it shall not be construed to
require personal notice, but, except as otherwise specifically provided, such
notice may be given in writing, by mail, by depositing a copy of the same in a
post office, letter box or mail chute, maintained by the United States Postal
Service, postage prepaid, addressed to such stockholder, officer or director, at
his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
PARTICIPATION IN MEETINGS BY TELEPHONE
--------------------------------------
51. At any meeting of the Board of Directors or the Executive Committee or
any other committee designated by the Board of Directors, one or more directors
may participate in such meeting in lieu of attendance in person by 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
--------------------------
52. The judges of election appointed to act at any meeting of the
stockholders 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.
18
<PAGE>
AMENDMENTS
----------
53. 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 stockholders 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 the directors 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
stockholders 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.
19
<PAGE>
EXHIBIT B-198
CERTIFICATE OF INCORPORATION
OF
GPU CAPITAL, INC.
------------------
It is hereby certified that:
FIRST: The name of the corporation (hereinafter called the "corporation")
is GPU Capital, Inc.
SECOND: The address, including street, number, city and county, of the
registered office of the corporation in the State of Delaware is 1013 Centre
Road, City of Wilmington, County of New Castle; and the name of the registered
agent of the corporation in the State of Delaware at such address is Corporation
Service Company.
THIRD: The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
FOURTH: The total number of shares of stock which the corporation shall
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
follows:
NAME MAILING ADDRESS
Michael S. Shenberg c/o Berlack, Israels & Liberman LLP
120 West 45th Street
New York, New York 10036
SIXTH: The personal liability of the directors of the corporation is
hereby eliminated to the fullest extent permitted by paragraph (7) of subsection
(b) of section 102 of the General
1
<PAGE>
Corporation Law of the State of Delaware, as the same may by amended and
supplemented.
SEVENTH: The board of directors of the corporation is expressly authorized
to adopt, amend or repeal bylaws of the corporation.
EIGHTH: Elections of directors need not be by written ballot except and
to the extent provided in the by-laws of the corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this 8th day of October,
1998.
Michael S. Shenberg
Sole Incorporator
2
<PAGE>
State of Delaware
Office of the Secretary of State
---------------------------------
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF
DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT
COPY OF THE CERTIFICATE OF INCORPORATION OF "GPU CAPITAL, INC.",
FILED IN THIS OFFICE ON THE NINTH DAY OF OCTOBER, A.D. 1998, AT
9 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE
NEW CASTLE COUNTY RECORDER OF DEEDS.
<PAGE>
EXHIBIT B-199
GPU CAPITAL, INC.
By-Laws
OFFICES
1. GPU Capital, Inc. (the "Corporation") shall have offices at such 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 "Delaware".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.
STOCKHOLDERS' MEETINGS
3. All meetings of stockholders 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 stockholders shall be held on such date and time as shall
be determined by the Board of Directors. At the annual meeting, the stockholders
entitled to vote shall elect by ballot a Board of Directors and transact such
other business as may properly be brought before the meeting.
5. Except as otherwise provided by law or by the Certificate of Incorporation,
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
stockholders. If,
<PAGE>
however, the holders of a majority of such shares of stock shall not be present
or represented by proxy at any such meeting, the stockholders 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 stockholders each holder of record of shares of capital
stock then entitled to vote shall be entitled to vote in person, or by proxy
appointed by instrument executed in writing by such stockholders or by his duly
authorized attorney; but no proxy shall be valid after the expiration of eleven
months from the date of its execution unless the stockholder executing it shall
have specified therein the length of time it is to continue in force, which
shall be for some specified period. Except as otherwise provided by law or by
the Certificate of Incorporation, each holder of record of shares of capital
stock entitled to vote at any meeting of stockholders shall be entitled to one
vote for every share of capital stock standing in his name on the books of the
Corporation. 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 thereof,
shall not be voted. All elections shall be determined by a plurality vote, and,
except as otherwise provided by law or by the Certificate of Incorporation 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.
7. Special meetings of the stockholders for any purpose or purposes, unless
otherwise prescribed by law, may be called by the Chairman or by the President,
and shall be called by the chief executive officer or Secretary at the request
in writing of any three members of the Board of Directors, or at the request in
writing of holders of record of ten percent of the shares of capital stock of
the Corporation issued and outstanding. Business transacted at all special
meetings of the stockholders shall be confined to the purposes stated in the
call.
<PAGE>
8. (a) Notice of every meeting of stockholders, setting forth the time and
the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more than fifty days prior to such meeting, to each
stockholder of record (at his address appearing on the stock books of the
Corporation, unless he shall have filed with the Secretary of the
Corporation a written request that notices intended for him 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 39 of the By-Laws. Except as otherwise provided by law,
the Certificate of Incorporation or 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 stockholders at a meeting
thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed
with, if all the stockholders who would have been entitled to vote upon the
action if such meeting were held, shall consent in writing 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 Certificate of
Incorporation under which the written consent of the holders of less than
all outstanding shares is sufficient for corporate action.
DIRECTORS
9. The business and affairs of the Corporation shall be managed by its Board of
Directors, which shall consist of not less than one nor more than six directors
as shall be fixed from time to time by a resolution adopted by a majority of the
entire Board of Directors; provided, however, that no decrease in the number of
directors constituting the entire Board of Directors shall shorten the term of
any incumbent director. Each director shall be at least twenty-one years of
age. Directors need not be stockholders of the Corporation. Directors shall be
elected at the annual meeting of stockholders, or, if any such election shall
not be held, at a stockholders, meeting called and held in accordance with the
provisions of the General Corporation Law of the State of Delaware. Each
director shall serve until the next annual meeting of stockholders and
thereafter until his successor shall have been elected and shall qualify.
<PAGE>
10. 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 Certificate
of Incorporation, or by the By-Laws directed or required to be exercised or done
by the stockholders.
11. 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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and the Board
in good faith authorizes the contract or transaction by a vote sufficient for
such purposes without counting the vote of the interested director or directors;
or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to
vote thereon, and the contract or transaction is specifically approved
in good faith by vote of the stockholders; 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 stockholders.
No director or officer shall be liable to account to the Corporation for
any profit realized by him from or through any such contract or transaction of
the Corporation by reason of his interest 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 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,
<PAGE>
because of such relation, be deemed interested in such contract or other
transaction under any of the provisions of this Section 11, nor shall any such
director be liable to account because of such relation. For the purposes of
this Section 11, 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 11 or prevent the authorization, ratification or approval, in any
other manner provided by law, of any contract or transaction described in this
Section 11.
MEETINGS OF THE BOARD OF DIRECTORS
12. 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. 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.
13. 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 his duties shall give notice either
personally or by telephone or telecopy 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.
14. At all meetings of the Board of Directors a majority of the directors in
office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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
certificate of Incorporation, as amended, or by the By-Laws.
<PAGE>
15. 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
16. 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 except such powers as the Board of Directors may exercise by virtue of
Section 10 of the By-Laws. The Executive Committee shall have no power to revoke
any action taken by the Board of Directors, and shall be subject to any
restriction imposed by law, by the By-Laws, or by the Board of Directors.
17. 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. 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 9 of the By-
Laws fill any 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.
18. 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.
<PAGE>
COMPENSATION AND REIMBURSEMENT OF DIRECTORS
AND MEMBERS OF THE EXECUTIVE COMMITTEE
19. Directors, other than salaried officers of the Corporation or its
affiliates, shall receive compensation and benefits for their services as
directors, at such rate or under such conditions 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.
20. 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 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 the Executive Committee or such other Committees of the
Board and for otherwise performing their duties as members of such Committees.
OFFICERS
21. The officers of the Corporation shall be chosen by a vote of a majority of
the directors in office and shall be a President, one or more Vice Presidents, a
Treasurer, and a Secretary, and may include a Chairman, 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 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. Neither the
Comptroller nor any Assistant Comptroller may occupy any other office. With the
above exceptions, any two offices may be occupied and the duties thereof may be
performed by one person.
22. The salary and other compensation of the chief executive officer of the
Corporation shall be determined from time to time by the Board of Directors. The
salaries and other compensation of all other officers of the Corporation shall
be determined from time to time by the chief executive officer, subject to the
concurrence of the Chairman.
<PAGE>
23. The salary or other compensation of all employees other than officers of
the Corporation 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.
24. 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, and perform such duties as shall be determined from time
to time by the Board of Directors.
25. The officers of the Corporation shall hold office until the first meeting
of the Board of Directors after the next succeeding annual meeting of
stockholders and until their respective successors are chosen and qualify. Any
officer elected pursuant to Section 21 of the By-Laws may be removed at any
time, with or without cause, by the vote of a majority of the directors 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, 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
26. (a) If a Chairman shall be chosen by the Board of Directors, he shall
preside at all meetings of the Board at which he shall be present.
(b) If a Chairman shall be chosen by the Board of Directors and if he shall
be designated by the Board as chief executive officer of the Corporation:
(i) he 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) he 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
<PAGE>
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) he may, unless otherwise directed by the Board of Directors
pursuant to Section 36 of the By-Laws, attend in person or by
substitute or proxy appointed by him and act and vote on behalf of the
Corporation at all meetings of stockholders of any corporation in
which the Corporation holds stock and grant any consent, waiver, or
power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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 if he shall
not be designated by the Board as chief executive officer of the
Corporation:
(i) he 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;
(ii) he 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
27. (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 he shall be
present.
<PAGE>
(b) If the President shall be designated by the Board of Directors as chief
executive officer of the Corporation:
(i) he 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) he 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) he may, unless otherwise directed by the Board of Directors
pursuant to Section 36 of the By-Laws, attend in person or by
substitute or proxy appointed by him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in
which the Corporation holds stock and grant any consent, waiver, or
power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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;
<PAGE>
(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
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 36 of the By-Laws, attend in person or by substitute or proxy
appointed by him and act and vote on behalf of the Corporation at all
meetings of the stockholders 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 his opinion 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
28. (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 27 (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 Directors and the Executive Committee, if
there be one.
(b) He 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
<PAGE>
be one, 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) He 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 27(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 Subsections 27(b)(iii) and
27(c)(iv) of the By-Laws, unless otherwise directed by the Board of
Directors pursuant to Section 36 of the By-Laws, attend in person or by
substitute or proxy appointed by him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which
the Corporation holds stock and grant any consent, waiver or power of
attorney in respect of such stock.
(d) He 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 or a Senior 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 27(c)(ii) of
the 13y-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
29. (a) The Secretary shall attend all meetings of the Board of Directors and
all meetings of the stockholders and record all votes and the minutes of
all proceedings in books to be kept for that purpose; and he shall perform
like duties for the Executive Committee and any other committees created by
the Board of Directors.
<PAGE>
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which
notice is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He shall be the custodian of the seal of the Corporation and, pursuant
to Section 44 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) He shall have control of the stock ledger, stock certificate book and
all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability, and shall exercise
such other powers and duties as may be prescribed by the Board of
Directors.
THE TREASURER
30. (a) The Treasurer shall be responsible for the safekeeping of the
corporate funds and securities of the Corporation, and shall maintain and
keep in his custody 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.
<PAGE>
(b) He 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 44 of the By-Laws, he may, when authorized by the
Board of Directors, affix the seal to all instruments requiring it and
shall attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation,
retirement or removal from office, of all books, papers, vouchers, money
and other property of whatever kind in his possession or under his control
belonging to the Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability, 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.
<PAGE>
COMPTROLLER
31. (a) If and when elected by the Board of Directors, 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
his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the
Board or any director of the Corporation, and shall render a full financial
report at the annual meeting of the stockholders, if called upon to do so.
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the Corporation
of all receipts and disbursements, and shall see that correct vouchers are
taken for all disbursements for any purpose.
<PAGE>
(h) He 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 his duties, shall exercise his
powers and duties at his request or in his absence or disability and
shall exercise such other powers and duties as may be conferred or
required 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.
VACANCIES
32. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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
33. Any 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 acceptance, 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.
<PAGE>
DUTIES OF OFFICERS MAY BE DELEGATED
34. 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 the total number of directors provided for in Section 9 of
the By-Laws may, notwithstanding any 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
35. (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 office under
the General Corporation Law of the State of Delaware, 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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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 to the fullest
extent permitted by law.
(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
<PAGE>
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 he 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 any 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
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.
<PAGE>
(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 shareholder, or disinterested directors or otherwise, both as to action
in an official capacity and as to action 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
36. 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
stockholders 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.
CERTIFICATE OF STOCK
37. 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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.
<PAGE>
TRANSFER OF STOCK
38. 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
39. The Board of Directors is hereby authorized to fix a time, not exceeding
fifty (50) days preceding the date of any meeting of stockholders 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 stockholders 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 stockholders of record at such time shall
be entitled to receive any such notice, dividend, distribution, rights or
interests.
REGISTERED STOCKHOLDERS
40. The Corporation shall be entitled to treat the holder of record 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 State of
Delaware.
LOST CERTIFICATES
41. 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
<PAGE>
advertisement of such loss in such manner as the Board of Directors may
prescribe.
INSPECTION OF BOOKS
42. The Board of Directors may determine whether and to what extent, and at
what time the 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 stockholders), or any of them, shall be open to the inspection
of stockholders, and no stockholder 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 State of Delaware or by the By-Laws or by resolution of the
Board of Directors or of the stockholders.
CHECKS, NOTES, BONDS AND OTHER INSTRUMENTS
43. 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 of 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.
44. 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 Chairman or 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 Chairman or the President or a Vice President and the
Secretary or an Assistant Secretary or the Treasurer or Assistant Treasurer upon
any
<PAGE>
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 facsimile signature appears thereon, had not
ceased to be such officer of the Corporation.
RECEIPTS FOR SECURITIES
45. All receipts for stocks, bonds or other securities received 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
46. The fiscal year shall begin the first day of January in each year.
DIVIDENDS
47. (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 to 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
<PAGE>
equalizing dividends, or for such other purpose as it shall deem to be in
the interest of the Corporation.
NOTICES
48. (a) Whenever under the provisions of the By-Laws notice is required to be
given to any director, officer of stockholder, it shall not be construed to
require personal notice, but, except as otherwise specifically provided,
such notice may be given in writing, by mail, by depositing a copy of the
same in a post office, letter box or mail chute, maintained by the United
States Postal Service, postage prepaid, addressed to such stockholder,
officer or director, at his address as the same appears on the books of the
Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
PARTICIPATION IN MEETINGS BY TELEPHONE
49. At any meeting of the Board of Directors or the Executive Committee or any
other committee designated by the Board of Directors, one or more directors may
participate in such meeting in lieu of attendance in person by 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.
AMENDMENTS
50. 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 stockholders duly held. The By-Laws may also be altered or
amended by the affirmative vote of a majority of the directors in office at a
meeting of the Board of Directors.
<PAGE>
EXHIBIT B-200
ARTICLES OF ASSOCIATION
GPU DO BRASIL LTDA.
<PAGE>
GPU do Brasil Ltda.
ARTICLES OF ASSOCIATION
By this instrument, the undersigned: (a) GPU Electric, Inc., a corporation
organized and existing under the laws of the State of Delaware, with its
principal place of business in the City of Parsippany, State of Delaware, United
States of America, at One Upper Pond Road, herein represented by its attorney-
in-fact, Irene Dias da Silva, Brazilian, single, lawyer, resident and domiciled
in the City of Sao Paulo, State of Sao Paulo, with offices at Rua Boa Vista,
254, 9th floor, bearer of Identity Card (R.G.) No. 4.121.494 SSP/SP, and
enrolled in the Individual Taxpayers' Register (CPF) under No. 055.894.288-15;
and (b) GPU Brasil, Inc., a corporation organized and existing under the laws of
the State of Delaware, with its principal place of business in the City of
Parsippany, State of Delaware, United States of America, at One Upper Pond Road,
herein represented by its attorney-in-fact, Irene Dias da Silva, identified
above, organize, as they have organized, a limited liability company, to be
governed by the following articles and conditions:
Article 1. - The company shall operate under the name GPU DO BRASIL LTDA.
Article 2. - The company has its principal place of business in the City of
Sao Paulo, State of Sao Paulo, at Rua Boa Vista, 254, 7th floor, suite 721.
Branches, offices and representation may be maintained elsewhere in Brazil or
abroad, by resolution of the quotaholder(s) representing the majority of the
quota capital.
Article 3. - The corporate purpose of the company is:
(a) to participate in other foreign or domestic companies, whether
commercial or civil, engaged in the generation, distribution and transmission of
electric power, as partner, shareholder or quotaholder; and
(b) to represent other foreign or domestic companies.
Article 4. - The company is established for an indeterminate period of
time.
<PAGE>
ARTICLE 5. - The quota capital of the company is one thousand reais (R$
1.000,00), divided into one thousand (1,000) quotas for the amount of one real
(R$ 1,00) each, distributed among the quotaholders as follows:
(a) GPU Electric, Inc. owns nine hundred and ninety-nine (999) quotas for
the amount of nine hundred and ninety-nine reais (R$ 999,00).
(b) GPU Brasil, Inc. owns one (1) quota for the amount of one real (R$
1,00).
PARAGRAPH 1 - The quota capital of the company shall be paid up in
Brazilian currency, credits or assets within one (1) year.
PARAGRAPH 2 - The liability of the quotaholders is limited to the total
amount of the company's quota capital.
ARTICLE 6. - The company's business shall be managed and administered by
the quotaholder GPU Electric, Inc., which shall delegate its powers to one or
more managers, who must be individuals resident in Brazil.
PARAGRAPH 1 - The delegate managers shall be appointed in a proper
instrument to be registered at the competent registry, and this instrument shall
serve as sufficient evidence of such appointment. The delegate managers shall
take office on the date of their election and shall remain in office until such
time as they are replaced by their successors.
PARAGRAPH 2 - The term of office of the delegate managers shall be
established in the respective instrument of appointment. Delegate managers may
be replaced at any time by resolution of the quotaholder(s) which appointed
them.
PARAGRAPH 3 - The compensation of the delegate managers shall be
established by the quotaholder(s) representing two thirds (2/3) of the company's
quota capital and shall be charged to the company's general expenses account.
PARAGRAPH 4 - One of the delegate managers may be designated Chief
Executive Officer, if so established in the respective instrument of
appointment.
ARTICLE 7. - The delegate managers shall manage the company's business in
general and shall be empowered to perform
<PAGE>
all acts necessary or advisable for such purpose, except as specified in article
10 hereof. Their powers shall include, but shall not be limited to those
necessary:
(a) to ensure compliance with the law and these articles of association and
implementation of resolutions passed at the quotaholders meetings and at the
delegate managers meetings;
(b) to administer, manage and direct the business of the company, and to
purchase, sell, exchange, encumber or otherwise acquire the company's assets or
property, establishing the prices, terms and conditions thereof;
(c) to issue internal regulations, rules and other similar guidelines
relating to the management of the company;
(d) to delegate the various management duties of the company among their
members; and
(e) to appoint attorneys in fact on behalf of the company.
SOLE PARAGRAPH - Any delegate manager, individually, shall be competent to
represent the company in his capacity as either plaintiff or defendant, in and
out of court, as regards third parties, any public agency or any federal, state
or municipal authorities, as well as autonomous government entities, mixed-
capital companies and quasi-governmental entities.
ARTICLE 8. - All acts and documents which involve the company in any
liability or obligation, such as deeds of any kind, checks, promissory notes,
bills of exchange, money orders, instruments of indebtedness in general,
contracts, including loan agreements and other documents not specified herein,
must bear the signature of:
(a) two delegate managers acting jointly;
(b) one delegate manager jointly with an attorney in fact; or
(c) two attorneys in fact vested with special powers, acting jointly.
SOLE PARAGRAPH - In the event there is only one acting delegate manager,
the company may be represented by this delegate manager.
<PAGE>
ARTICLE 9. - Powers of attorney issued by the company shall be signed by
the managing quotaholder or any of the delegate managers, shall specify the
powers granted and shall be valid for a limited period of time, with the
exception of those granted for judicial purposes.
ARTICLE 10. - The powers to purchase, sell, mortgage or otherwise dispose
of or create a lien on real property shall require the prior written
authorization of the quotaholder(s) representing two-thirds (2/3) of the quota
capital of the company.
ARTICLE 11. - The acts of any of the company quotaholders, officers,
managers, employees or attorneys in fact that involve the company in any
obligation regarding business or transactions which exceed the scope of its
business purpose, such as sureties, aval guarantees, endorsements or any
guarantees whatsoever in favor of third parties, are hereby expressly forbidden,
and shall be deemed to be null and void and without any effect in relation to
the company, except as otherwise authorized in writing by the quotaholder(s)
representing two-thirds (2/3) of the quota capital of the company.
ARTICLE 12. - No quotaholder may sell or otherwise transfer any of its
quotas, either to the other quotaholders or to third parties, without the prior
written consent of the quotaholder(s) representing two-thirds (2/3) of the
company's quota capital.
ARTICLE 13. - The fiscal year of the company shall begin on January lst and
end on December 31st. At the end of each fiscal year, the balance sheet and
other financial statements shall be prepared for that fiscal year.
ARTICLE 14. - The net profits earned in each fiscal year shall be allocated
as determined by the quotaholder(s) representing two-thirds (2/3) of the
company's quota capital, all quotaholders' being assured of their proportional
participation. Quotaholders shall have no rights in or to any portion of the
profits until a specific resolution is passed determining their allocation.
<PAGE>
SOLE PARAGRAPH - The company may prepare interim balance sheets on a half-
yearly or quarterly basis or at shorter intervals, and distribute the respective
profits on the basis of these balance sheets.
ARTICLE 15. - In the event of winding-up or liquidation of the company, the
liquidator shall be the quotaholder appointed by the quotaholder(s) representing
two thirds (2/3) of the company's quota capital. In this event, the assets of
the company shall be used to satisfy the outstanding debts of the company. The
remaining assets, if any, shall be divided among the quotaholders in proportion
to the number of quotas which they hold.
ARTICLE 16. - The withdrawal, extinguishment, death, exclusion, bankruptcy
or concordata of any quotaholder shall not result in the winding-up of the
company, which shall continue to exist with the remaining quotaholders, unless
the latter decide that the company shall be liquidated, provided they represent
two-thirds (2/3) of the company's quota capital. The assets pertaining to the
withdrawn, extinguished, deceased, excluded, bankrupt or legally incapacitated
(concordatario) quotaholder shall be calculated on the basis of the latest
balance sheet prepared by the company, and shall be paid to the rightful party
within six months of the event.
ARTICLE 17. - These articles of association may be freely amended at any
time, including amendments for the purpose of excluding a quotaholder, by
resolution of the quotaholder(s) representing two-thirds (2/3) of the quota
capital of the company.
ARTICLE 18. - Disputes arising out of these articles of association shall
be submitted to the courts of the State of Sao Paulo, State of Sao Paulo, to the
exclusion of all others, however privileged they may be.
<PAGE>
IN WITNESS WHEREOF the parties sign this instrument in three (3) counterparts of
identical content in the presence of the two (2) undersigned witnesses.
Sao Paulo, March 10, 1998
GPU ELECTRIC, INC.
By
Irene Dias da Silva
GPU BRASIL, INC.
By
Irene Dias da Silva
Irene Dias da Silva
Brazilian Bar Association/Sao Paulo
Chapter (OAB/SP) 31.186
Witnesses:
1. -
Name:
R.G.:
2. -
Name:
R.G.:
<PAGE>
EXHIBIT B-201
BYLAWS
GPU SAO PAULO S.A.
<PAGE>
GPU SAO PAULO S.A.
Minutes of the General Meeting for Incorporation of a Company
held on
March 3,1998
On March 10, 1998, at 10 a.m., in the City of Sao Paulo, State of Sao Paulo, at
Rua Boa Vista, 254, 7th floor, room 721, the undersigned met with the purpose of
organizing GPU SAO PAULO S.A., to wit: (A) GPU BRASIL, INC., a corporation
organized and existing under the laws of the State of Delaware, with its
principal place of business in the City of Parsippany, State of Delaware, United
States of America, at One Upper Pond Road, herein represented by its attorney-
in-fact, IRENE DIAS DA SILVA, Brazilian, single, lawyer, resident and domiciled
in the City of Sao Paulo, State of Sao Paulo, with offices at Rua Boa Vista,
254, 9th floor, bearer of Identity Card (R.G.) No. 4.121.494 SSP/SP, and
enrolled in the Individual Taxpayers' Register (CPF) under No. 055.894.288-15;
and (b) GPU ELECTRIC, INC., a corporation organized and existing under the laws
of the State of Delaware, with its principal place of business in the City of
Parsippany, State of Delaware, United States of America, at One Upper Pond Road,
herein represented by its attorney-in-fact, IRENE DIAS DA SILVA, identified
above. At the request of those present, Ms. Rosana Renata Cirillo Gerez Noguero
acted as Chairman of the meeting, and invited me, Maria Helena R. Marcondes
Pedrosa, to act as Secretary, and the presiding board was thus established.
Immediately thereafter, the Chairman declared that the General Meeting was
convened to resolve on the incorporation of a Joint-stock Company, governed
pursuant to Law 6404 of December 15, 1976, under the name GPU SAO PAULO S.A., of
which all those present were fully aware. After these explanations, the
Chairman requested that I, the Secretary, proceed with the reading of the Bylaws
draft, which I did, and whose content is the following: BYLAWS OF GPU DO BRASIL
S.A.-PART I. - NAME, HEAD OFFICE, OBJECT AND DURATION. Article 1. - Under the
name of GPU Sao Paulo S.A. a joint-stock company (sociedade anonima) is hereby
incorporated, and shall be governed by these Bylaws and by applicable law.
Article 2. - The company shall have its head office and jurisdiction at Rua Boa
Vista, 254, 7th floor, room 721, in the City of Sao Paulo, State of Sao Paulo,
and may open branches, agencies or
1
<PAGE>
representative offices in any other part of the country or abroad, as the
Executive Committee may by resolution determine. Article 3. - The object of the
company is: (a) the participation in other foreign or national companies
dedicated to the generation, distribution and transmission of electric power,
whether or not commercial, as a partner, shareholder or quotaholder; and (b) the
representation of other foreign or national companies. Article 4. - The
duration of the company's corporate life is indeterminate. PART II. - SHARE
CAPITAL. Article 5. - The capital of the company is one thousand reais (R$
1.000,00), divided into one thousand (1,000) ordinary or common, registered
shares, with a par value of one real (R$ 1,00) each, which may be represented by
multiple or single certificates, which shall be signed by two directors.
Paragraph 1. - Shareholders shall have a preemptive right to the subscription of
capital shares in proportion to the number of shares previously held thereby.
In the event any shareholder waives his or its preemptive right in writing or,
if consulted, does not reply within thirty (30) days as from the consultation
date, the Executive Committee may offer such shares to third parties. Paragraph
2. Subscription of the shares in the capital stock for payment in installments
is subject to the initial payment provided for pursuant to the law, and the
balance shall be paid according to the conditions established by the Executive
Committee, with the approval of the Audit Committee, if in operation. Article
6. - Each common registered share shall be entitled to one vote in the
resolutions of the General Meeting. PART III. - MANAGEMENT. Article 7. - The
company shall be managed by an Executive Committee made up of at least two (2)
and at most four (4) directors, shareholders or not, but all resident in the
country and elected by the Annual General Meeting. One of the Directors shall
be the Director President and the others shall be Directors without specific
title. Article 8 - The term of office of the Executive Committee shall be of
one year, from one Annual General Meeting to the next. All directors shall
remain in office until their successors are invested in office, re-election
being permitted. Sole Paragraph - The remuneration of the directors shall be
established by the general meeting that elected them. Article 9. - In the event
of a vacancy, for any reason, in the office of the Director President, the
Executive Committee shall appoint an alternate among the remaining directors, in
the first meeting to be held after the vacancy takes place. In the event of a
vacancy in any other office of the Executive Committee, the Executive Committee
in the first meeting to be held after the
2
<PAGE>
vacancy, if it does think fit or necessary, shall temporarily fill the vacancy
with a person that shall remain in office until the first general meeting held
after such event, when the vacancy shall be permanently filled. Sole Paragraph
- - The director appointed in accordance with this article shall remain in office
until the first general meeting to be held after such event. Article 10. - The
Executive Committee shall manage the business of the company in general and in
so doing shall perform all necessary or advisable acts, except for those which
by law or these Bylaws are required to be done by a general meeting. The powers
of the Committee shall include, but are not limited to, those sufficient for:
(a) ensuring observance of the law and these Bylaws; (b) ensuring the
implementation of the resolutions taken at general meetings and at its own
meetings; (c) administering, managing and directing the business of the company;
(d) issuing and approving such internal instructions and regulations as it shall
deem necessary or desirable; and (e) distributing among its members the
management duties of the company. Paragraph 1. - The Director President shall
represent the company, as plaintiff or defendant, in and out of Court, before
third parties, before any government departments or federal, state or municipal
authorities, as well as before autarchies, mixed economy companies and parastate
entities. Paragraph 2. - The Executive Committee may in meeting appoint any
director or authorize the appointment of an attorney in fact to individually
perform any act which the Executive Committee or any director is competent to
perform without prejudice to any identical powers or attributes granted by these
Bylaws or by the Executive Committee to the Committee or to any director.
Paragraph 3. - The sale, exchange, transfer or other disposal, or mortgage,
pledge or encumbrance of whatever nature, of the company's real assets shall be
subject to the authorization and approval of the general meeting. Article 11. -
The Executive Committee shall meet whenever necessary and at least once a year
under the chairmanship of the Director President or, in his absence, of any
director chosen on the occasion. Paragraph 1. - Meetings shall always be called
by the Director President or any two (2) directors. The presence of a majority
of the then existing directors shall constitute a quorum and permit valid
resolutions or, if the company shall have only two directors at the time, the
presence of such two directors shall constitute a quorum. Paragraph 2. - The
resolutions of the Executive Committee shall be recorded in minutes drawn up in
the proper book and shall be approved by a majority of votes, the Chairman of
the meeting having an additional casting vote in the case of
3
<PAGE>
a tie. Article 12. - In the case of temporary absence or impairment of any
director, such director may, subject to the approval of the Executive Committee,
select an alternate director to serve during his absence or impairment. The
alternate director shall exercise all functions and shall have all powers,
rights and duties of the director for whom he is an alternate director. Sole
Paragraph - The alternate director may be a director himself, in which case he
shall have, at the Executive Committee Meetings, one vote for himself and
another vote as an alternate director. Article 13. - Deeds of any nature, bills
of exchange, checks, money orders, contracts and other documents which create
any liability or obligation for the company must be signed: (a) by two (2)
directors jointly; (b) by any one (1) director jointly with an attorney in fact;
or (c) by two (2) attorneys in fact jointly, provided that they have been vested
with special and specific powers. Sole Paragraph - In accordance with the
provisions of Article 10, paragraph 2, the company may be represented by a sole
director or attorney in fact, acting individually. Article 14. - Powers of
attorney in the name of the company shall always be granted by two (2)
directors, shall specify the powers conferred and, with the exception of those
granted for judicial purposes, shall be granted for a limited period of at most
one year. Article 15. - The acts of any director, employee of, or attorney for
the company, which involve the company in any obligation relative to business or
operations outside the scope of the object of the company, such as sureties,
"avais", endorsements or any other guarantees, in favor of third parties, are
hereby expressly forbidden and shall be deemed to be null and void and without
any effect in relation to the company, except when expressly authorized by the
Executive Committee in meeting. PART IV. -GENERAL MEETINGS. Article 16. -
General meetings shall be annual general meetings and extraordinary general
meetings. The annual general meetings shall be held within the first four
months following the end of the financial year, and extraordinary general
meetings shall be held as often as may be necessary. Article 17. - General
meetings shall be presided over by the Director President of the company or by
his substitute, or, in the absence of both, by a shareholder chosen by a
majority of votes of those present. The Chairman of the meeting shall appoint
the Secretary of the meeting. PART V. - AUDIT COMMITTEE. Article 18. - The
company's Audit Committee, which shall be made up of three (3) effective members
and three deputies, shall operate in a provisional capacity and shall be
composed, installed and remunerated in accordance with
4
<PAGE>
applicable law. PART VI. - FINANCIAL YEAR, BALANCE SHEET AND PROFITS. Article
19. - The financial year shall begin on the 1st of January and end on the 31st
of December of each year. Article 20. - At the end of each financial year, the
financial statements shall be drawn up in accordance with the provisions of the
law. Article 21. - The net profits ascertained in each financial year shall be
applied as determined at a general meeting and as approved by the Audit
Committee, if in operation, after the deductions required by law have been made.
Sole Paragraph. - Shareholders are assured the right to receive a compulsory
annual dividend of not less than five percent (5%) of the net profit of the
year, increased or reduced by the following amounts: (a) quota for the formation
of the legal reserve; (b) amount for the formation of contingency reserves and
reversion of these same reserves formed in previous years; and (c) realizable
profits transferred to the respective reserve and profits previously recorded in
this reserve and realized during the year. PART VII. - LIQUIDATION. Article
22. - The company shall go into liquidation when required by law, the general
meeting being competent to determine the manner of liquidation and to appoint
the liquidator and the Audit Committee which shall officiate during the period
of liquidation. Article 23. - In the event of any omission or doubt hereunder,
the legal provisions in force shall prevail." After the document transcribed
above was read, the Chairman put the subject and the By-laws draft to discussion
and then to a vote, and both were fully and unanimously approved. Immediately
thereafter, the Chairman verified the subscription of the corporate capital of
GPU SAO PAULO S.A., which was carried out according to the Subscription
Bulletin, and the deposit voucher of the amount received from the subscribers in
Brazilian currency, which was made on this date at the Banco do Brasil S.A.,
Central Branch - Sao Bento, by way of payment of ten percent (10%) of the
corporate capital, which documents shall become an integral part hereof, i.e.,
the total amount of one hundred reais (R$ 100,00). After verification of
whether all legal formalities had been complied with, and after the approval by
the shareholders of all documents presented at this meeting, the Chairman
declared that GPU SAO PAULO S.A. was definitely incorporated, for all purposes
of the law, and that the election of the officers of the company had to be
carried out. After the matter was put to a vote, Ms. Rosana Renata Cirillo
Gerez Noguero, Brazilian, married, lawyer, resident and domiciled in the City of
Maua, State of Sao Paulo, with offices at Rua Boa Vista, 254, 7th floor, room
721, bearer of Identity Card (R.G.)
5
<PAGE>
No. 8.917.535 SSP/SP, and enrolled in the Individual Taxpayers' Register (CPF)
under No. 033.624.038-40 was elected Director President of the Company, and Ms.
Maria Helena R. Marcondes Pedrosa, Brazilian, single, translator, resident and
domiciled in the City of Sao Paulo, State of Sao Paulo, with offices at Rua Boa
Vista, 254, 7th floor, bearer of Identity Card (R.G.) No. 3.160.238 SSP/SP, and
enrolled in the Individual Taxpayers' Register (CPF) under No. 215.414.268-00,
was elected Director Vice-president. After the result of the voting was
informed to all those present, the Chairman explained that the members elected
hereby accepted their appointment, representing that they were fully aware of
the provisions of article 147 of Law 6404 of December 15, 1976, and consequently
that they were not involved in any crime provided for by law, which might
prevent them from carrying out commercial activities. Therefore, the Directors
were invested in their offices, after compliance with the legal formalities,
with a term of office of one (1) year, and with an aggregate annual compensation
of one hundred reais (R$ 100,00). Finally, it was unanimously resolved that the
Audit Committee of the Company would not be installed, pursuant to article 161
of Law 6404 of December 15, 1976, and by article 18 of the Bylaws herein
approved. There being nothing further to discuss, the floor was offered to
whomever wished to take it, and since nobody did, the works were closed and the
meeting adjourned for the time necessary to draw up these minutes, which after
the meeting was reinstalled, were read, approved and signed by all those
present.
Sao Paulo, March 10, 1998
(sgd)
Rosana Renata Cirillo Gerez Noguero
Chairman
(sgd)
Maria Helena R. Marcondes, Pedrosa
Secretary
6
<PAGE>
Shareholders: GPU BRASIL, INC.
By (sgd)
Irene Dias da Silva
GPU ELECTRIC, INC.
By (sgd)
IRENE DIAS DA SILVA
Directors:
(sgd)
Rosana Renata Cirillo Gerez Noguero
Director President
(sgd)
Maria Helena R. Marcondes Pedrosa
Director Vice-president
Acknowledged and agreed:
(sgd)
IRENE DIAS DA SILVA - BRAZILIAN BAR
ASSOCIATION/SAO PAULO CHAPTER (OAB/SP)
31.186
7
<PAGE>
EXHIBIT B-202
Certificate of Registration of a Company
Corporations Law Sub-section 121(1)
This is to certify that
GPU GASNET PTY LTD
Australian Company Number 083 009 278
is a registered company under Division 1 of Part 2.2 of the Corporations Law of
Victoria and because of its registration it is an incorporated company.
The company is limited by shares.
The company is a proprietary company.
The day of commencement of registration is the seventeenth day of June 1998.
Given under the seal of the Australian Securities Commission on this seventeenth
day of June, 1998.
<PAGE>
Memorandum
and
Articles of Association
of
GPU GasNet Pty Ltd
A Company Limited by Shares
Mallesons Stephen Jaques
Solicitors
Rialto
Level 28, North Tower
525 Collins Street
Melbourne Vic 3000
Telephone (03) 9643 4000
Fax (03) 9643 5999
DX 101 Melbourne
Ref NMB:RJK
<PAGE>
Memorandum of Association
of
GPU GasNet Pty Ltd
A Company Limited by Shares
1. The name of the company is GPU GasNet Pty Ltd
2. The capital of the company is $10,000,000 divided into:
100 ordinary shares of $1.00 each;
9,999,900 unclassified shares;
3. The liability of the members of the company is limited.
The subscriber whose name and address is set out below wishes to form a company
under this memorandum of association and respectively agrees to take the number
of shares in the capital of the company set out opposite his name.
Rodney Harold Keller One hundred (100) ordinary shares of 1705/265 Exhibition
Street $1.00 each
Melbourne Vic 3000
Occupation: Director
Signature Date: 16 June 1998
Witness to above signature:
Narelle Melissa Bridges
42/202 Wattletree Road
Malvern Vic 3144
Occupation: Para Legal
Signature Date: 16 June 1998
<PAGE>
Index of Articles of Association
1 Preliminary 1
2 Share capital and variation of rights 3
3 Lien 7
4 Calls on shares 8
5 Transfer of shares 10
6 Transmission of shares 11
7 Forfeiture of shares 13
8 Conversion of shares into stock 15
9 Alteration of capital 16
10 General meetings 17
11 Proceedings at general meetings 20
12 The Directors 27
13 Powers and duties of Directors 31
14 Proceedings of Directors 32
15 Secretary 38
16 Common seal and official seal 39
17 Inspection of records 40
18 Dividends and reserves 40
19 Capitalisation of profits 43
20 Notices 44
21 Winding up 45
22 Indemnity 46
<PAGE>
Articles of Association
of
GPU GasNet Pty Ltd
A Company Limited by Shares
1 Preliminary
Definitions
1.1 The following words have these meanings in these Articles unless
the contrary intention appears.
Alternate Director means a person appointed as alternate director
under Article 14.6;
Articles means these articles of association as amended from time
to time, and a reference to a particular article has a
corresponding meaning;
Auditor means the auditor or auditors for the time being of the
Company;
Company means the abovenamed company;
Director means a director for the time being of the Company, and
where appropriate includes an Alternate Director;
Executive Director means a person appointed as executive director
under Article 14.29;
Managing Director means a person appointed as a managing director
under Article 14.29;
Member means a person for the time being entered in the Register
as a member of the Company;
Register means the register of members of the Company to be kept
under the Corporations Law and if appropriate includes a branch
register;
1
<PAGE>
Registered Office means the registered office for the time being
of the Company;
Secretary means a person appointed by the Directors under Article
15.1 to perform the duties of secretary of the Company; and
State means the State or Territory in which the Company is from
time to time incorporated.
Interpretation
1.2 In these Articles:
(a) words importing any gender include all other genders;
(b) the word person includes a firm, a body corporate, an
unincorporated association or an authority;
(c) the singular includes the plural and vice versa; and
(d) a reference to a statute or code or the Corporations Law (or
to a provision of same) means the statute, code or the
Corporations Law (or provision of same) as modified or
amended and in operation for the time being, or any statute,
code or provision enacted (whether by the State or the
Commonwealth of Australia) in its place and includes any
regulation or rule for the time being in force under the
statute, code or the Corporations Law.
1.3 Unless the contrary intention appears in these Articles, an
expression has, in a provision of these Articles that deals with
a matter dealt with by a particular provision of the Corporations
Law, the same meaning as in that provision of the Corporations
Law.
1.4 Headings are inserted for convenience and do not affect the
interpretation of these Articles.
2
<PAGE>
Table A not to apply
1.5 The regulations contained in Table A in Schedule 1 to the
Corporations Law do not apply to the Company.
Proprietary company
1.6 The Company is a proprietary company and accordingly:
(a) the right to transfer shares is restricted under these
Articles;
(b) the number of Members of the Company (excluding employees of
the Company or a subsidiary and former employees who while
in the employment of the Company or a subsidiary became and
have continued to be Members) is limited to 50 and joint
holders of a share are counted as one person;
(c) any invitation to the public to subscribe for, and any offer
to the public to accept subscriptions for any shares in, or
debentures of, the Company is prohibited; and
(d) any invitation to the public to deposit money with, and any
offer to the public to accept deposits of money with, the
Company is prohibited.
2 Share capital and variation of rights
Directors to issue shares
2.1 Without prejudice to any special rights previously conferred on
the holders of any existing shares or class of shares but subject
to the Corporations Law, or as the Company in general meeting may
when authorising any issue of shares otherwise direct, shares in
the Company
3
<PAGE>
are under the control of the Directors who may allot or dispose
of all or any of the same to such persons at such times and on
such terms and conditions and having attached to them such
preferred, deferred or other special rights or such restrictions,
whether with regard to dividend, voting, return of capital or
otherwise and at a premium or at par or at a discount as the
Directors think fit.
2.2 The Directors have the right to grant to any person options or
other securities with rights of conversion to shares or pre-
emptive rights to any shares for any consideration and for any
period.
Preference shares
2.3 The Company may not issue any preference shares nor may any
issued shares be converted into preference shares unless the
rights of the holders of the preference shares with respect to
repayment of capital, participation in surplus assets and
profits, cumulative or non-cumulative dividends, voting and
priority of payment of capital and dividends in relation to other
shares or other classes of preference shares are set out in the
Articles. Subject to the corporations Law, preference shares
may, with the sanction of a resolution of the Company in general
meeting, be issued on the terms that they are, or at the option
of the Company are, liable to be redeemed.
Variation of rights
2.4 If at any time the share capital is divided into different
classes of shares, the rights attached to any class may (unless
otherwise provided by the terms of issue of the shares of that
class), whether or not the Company is being wound up, be varied
or abrogated in any way with the consent in writing of the
holders of three-quarters of the issued shares of that class, or
with the
4
<PAGE>
sanction of a special resolution passed at a separate meeting of
the holders of the shares of that class.
2.5 The provisions of these Articles relating to general meetings
apply so far as they are capable of application and with the
necessary changes to every separate meeting of the holders of a
class of shares except that:
(a) a quorum is constituted by two persons who, between them,
hold or represent one-third of the issued shares of the
class; and
(b) any holder of shares of the class, present in person or by
proxy, attorney or representative appointed under Article
11.2 may demand a poll.
2.6 The rights conferred on the holders of the shares of any class
are not deemed to be varied by the creation or issue of further
shares ranking equally with the first-mentioned shares unless
otherwise:
(a) expressly provided by the terms of issue of the first-
mentioned shares; or
(b) required by the Corporations Law.
Commission and brokerage
2.7 The Company may exercise the power to pay brokerage or commission
conferred by the Corporations Law. The rate or the amount of the
brokerage or commission paid or agreed to be paid must be
disclosed in the manner required by the Corporations Law.
2.8 The total brokerage and commission must not exceed 10% of the
total amount payable on allotment of the shares in respect of
which the commission is paid.
5
<PAGE>
2.9 The brokerage or commission may be satisfied by the payment of
cash or by the allotment of fully or partly paid shares or other
securities or partly by the payment of cash and partly by the
allotment of fully or partly paid shares or other securities.
Recognition and disclosure of interests
2.10 Except as required by law, the Company is not bound or compelled
in any way to recognise a person as holding a share on any trust.
2.11 The Company is not bound by or compelled in any way to recognise
(whether or not it has notice of the interest or rights
concerned) any equitable, contingent, future or partial interest
in any share or unit of a share or (except as otherwise provided
by these Articles or by law) any other right in respect of a
share except an absolute right of ownership in the registered
holder.
Right to share and option certificate
2.12 A person whose name is entered as a Member in the Register or as
an optionholder in the register of options is entitled without
payment to receive a certificate in respect of the shares or
options registered in the person's name under the seal of the
Company in accordance with the Corporations Law but, in respect
of shares or options held jointly by several persons, the Company
is not bound to issue more than one certificate.
2.13 Delivery of a certificate for a share to one of several joint
holders is sufficient delivery to all such holders.
Joint holders of shares
2.14 Where two or more persons are registered as the joint holders of
shares they are deemed to hold the shares as joint tenants.
6
<PAGE>
3 Lien
Lien on share
3.1 The Company has a first and paramount lien on every share (other
than a fully paid share) for all money (whether presently payable
or not) called or payable at a fixed time in respect of that
share and such lien extends to all dividends, rights and other
distributions from time to time declared paid or made in respect
of that share.
3.2 The Company also has a first and paramount lien on all shares
(other than fully paid shares) registered in the name of a Member
for all money presently payable by that Member to the Company and
all money which the Company may be called on by law to pay in
respect of the shares of that Member.
3.3 The Directors may at any time exempt a share wholly or in part
from the provisions of Articles 3.1 and 3.2.
Sale under lien
3.4 Subject to Article 3.5, the Company may sell, in such manner as
the Directors think fit, any share on which the Company has a
lien as if the share was forfeited.
3.5 A share on which the Company has a lien may not be sold by the
Company unless:
(a) a sum in respect of which the lien exists is presently
payable; and
(b) the Company has, not less than 14 days before the date of
sale, given to the registered holder for the time being of
the share or the person entitled to the share by reason of
the death or bankruptcy of the registered holder, a notice
in writing
7
<PAGE>
setting out, and demanding payment of, such part of the
amount in respect of which the lien exists as is presently
payable.
Transfer on sale under lien
3.6 For the purpose of giving effect to a sale mentioned in Article
3.4, the Company may receive the consideration (if any) given for
the share so sold and may execute a transfer of the share sold in
favour of the person to whom the share is sold.
3.7 The Company must register the transferee as the holder of the
share comprised in any such transfer and the transferee is not
bound to see to the application of the purchase money.
3.8 The title of the transferee to the share is not affected by any
irregularity or invalidity in connection with the sale of the
share.
Proceeds of sale
3.9 The proceeds of a sale mentioned in Article 3.4 must be applied
by the Company in payment of such part of the amount in respect
of which the lien exists as is presently payable, and the residue
(if any) must (subject to any like lien for sums not presently
payable that existed on the share before the sale) be paid to the
person entitled to the share at the date of the sale.
4 Calls on shares
Directors to make calls
4.1 The Directors may make calls on a Member in respect of any money
unpaid on the shares of the Member (whether on account of the
nominal value of the shares or by way of premium) and not by the
terms of issue of those shares made payable at fixed times.
8
<PAGE>
4.2 The Directors may revoke or postpone a call.
Time of call
4.3 A call is deemed to be made at the time when the resolution of
the Directors authorising the call is passed.
Members' liability
4.4 On receiving at least 14 days' notice specifying the time or
times and place of payment, each Member must pay to the Company
at the time or times and place so specified the amount called on
the Member's shares.
4.5 The joint holders of a share are jointly and severally liable to
pay all calls in respect of the share.
4.6 The non-receipt of a notice of any call by, or the accidental
omission to give notice of a call to, a Member does not
invalidate the call.
Interest on default
4.7 If a sum called in respect of a share is not paid before or on
the day appointed for payment of the sum, the person from whom
the sum is due must pay interest on the sum to the time of actual
payment at the rate, not exceeding 20% per annum, determined by
the Directors, but the Directors may waive payment of that
interest wholly or in part.
Fixed instalments deemed calls
4.8 Any sum that, by the terms of issue of a share, becomes payable
on allotment or at a fixed date, whether on account of the
nominal value of the share or by way of premium, is deemed for
the
9
<PAGE>
purposes of these Articles to be a call duly made and payable on
the date on which by the terms of issue the sum becomes payable,
and, in case of non-payment, all the relevant provisions of these
Articles as to payment of interest and expenses, forfeiture or
otherwise apply as if the sum had become payable by virtue of a
call duly made and notified.
Differentiation between shareholders as to calls
4.9 The Directors may, on the issue of shares, differentiate between
the holders as to the amount of calls to be paid and the times of
payment.
Prepayment of calls
4.10 The Directors may accept from a Member the whole or a part of
the amount unpaid on a share although no part of that amount has
been called.
4.11 The Directors may authorise payment by the Company of interest
on the whole or any part of an amount so accepted, until the
amount becomes payable, at such rate, not exceeding the
prescribed rate, as is agreed on between the Directors and the
Member paying the sum.
4.12 For the purposes of Article 4.11, the prescribed rate of interest
is:
(a) if the Company has, by resolution, fixed a rate - the rate
so fixed; and
(b) in any other case - 20% per annum.
5 Transfer of shares
Forms of instrument of transfer
10
<PAGE>
5.1 Subject to these Articles, a Member may transfer all or any of
the Member's shares by instrument in writing in any usual or
common form or in any other form that the Directors approve.
5.2 An instrument of transfer referred to in Article 5.1 must be
executed by or on behalf of both the transferor and the
transferee.
Registration procedure
5.3 The instrument of transfer must be left for registration at the
Registered Office accompanied by the certificate for the shares
to which it relates and such information as the Directors
properly require to show the right of the transferor to make the
transfer, and in that event, the Company must, subject to the
powers vested in the Directors by these Articles, register the
transferee as a shareholder.
5.4 A transferor of shares remains the holder of the shares
transferred until the transfer is registered and the name of the
transferee is entered in the Register in respect of the shares
and a transfer of shares does not pass the right to any dividends
declared on the shares until such registration.
Directors may decline to register
5.5 The Directors may decline to register any transfer of shares,
without being bound to give any reason whatsoever for so doing.
6 Transmission of shares
Transmission of shares on death of holder
6.1 In the case of the death of a Member, the survivor or survivors
where the deceased was a joint holder, and the legal personal
representatives of the deceased where the
11
<PAGE>
deceased was a sole holder, are the only persons recognised by
the Company as having any title to the deceased's interest in the
shares, but this Article does not release the estate of a
deceased joint holder from any liability in respect of a share
that had been jointly held by the deceased with other persons.
Right to registration on death or bankruptcy
6.2 Subject to the Bankruptcy Act 1966, a person becoming entitled to
a share in consequence of the death or bankruptcy of a Member
may, on such information being produced as is properly required
by the Directors, either elect to be registered as holder of the
share or nominate another person to be registered as the
transferee of the share. Where the surviving joint holder
becomes entitled to a share in consequence of the death of a
Member the Directors must, on satisfactory evidence of that death
being produced to them, direct the Register to be altered
accordingly.
6.3 If the person becoming entitled elects to be registered as holder
of the share under Article 6.2 the person must deliver or send to
the Company a notice in writing signed by the person in such form
as the Directors approve stating that the person so elects.
6.4 If the person becoming entitled nominates another person to be
registered as the transferee of the share under Article 6.2 the
person must execute a transfer of the share to the other person.
6.5 All the limitations, restrictions and provisions of these
Articles relating to the right to transfer, and the registration
of transfer of, shares are applicable to any such notice or
transfer as is if the death or bankruptcy of the Member had not
occurred and the notice or transfer were a transfer signed by
that Member.
12
<PAGE>
Effect of transmission
6.6 If the registered holder of a share dies or becomes bankrupt, the
personal representative or the trustee of the estate of the
registered holder, as the case may be, is, on the production of
such information as is properly required by the Directors,
entitled to the same dividends and other advantages, and to the
same rights (whether in relation to meetings of the Company, or
to voting or otherwise), as the registered holder would have been
entitled to if the registered holder had not died or become
bankrupt.
6.7 If two or more persons are jointly entitled to any share in
consequence of the death of the registered holder, they are, for
the purpose of these Articles, deemed to be joint holders of the
share.
7 Forfeiture of shares
Notice requiring payment of call
7.1 If a Member fails to pay a call or instalment of a call on the
day appointed for payment of the call or instalment, the
Directors may, at any time thereafter during such time as any
part of the call or instalment remains unpaid, serve a notice on
the Member requiring payment of so much of the call or instalment
as is unpaid, together with any interest that has accrued and all
costs and expenses that may have been incurred by the Company by
reason of such non-payment.
7.2 The notice must name a further day (not earlier than the
expiration of 14 days from the date of service of the notice) on
or before which the payment required by the notice is to be made
and must state that, in the event of non-payment at or before the
time appointed, the shares in respect of which the call was made
will be liable to be forfeited.
13
<PAGE>
Forfeiture for failure to comply with notice
7.3 If the requirements of a notice served under Article 7.1 are not
complied with, any share in respect of which the notice has been
given may at any time thereafter, before the payment required by
the notice has been made, be forfeited by a resolution of the
Directors to that effect.
7.4 Such a forfeiture includes all dividends declared in respect of
the forfeited shares and not actually paid before the forfeiture.
7.5 Any share forfeited under Article 7.3 may be sold, re-allotted or
otherwise disposed of to whom and on such terms and conditions,
subject to the Corporations Law, as the Directors think fit.
7.6 If any share is forfeited under Article 7.3 notice of the
forfeiture must be given to the Member holding the share
immediately prior to the forfeiture and an entry of forfeiture
with the date thereof must be made in the Register.
Cancellation of forfeiture
7.7 At any time before a sale or disposition of a share, the
forfeiture of that share may be cancelled on such terms as the
Directors think fit.
Effect of forfeiture on former holder's liability
7.8 A person whose shares have been forfeited ceases to be a Member
in respect of the forfeited shares, but remains liable to pay the
Company all money that, at the date of forfeiture, was payable by
that person to the Company in respect of the shares (including
interest at the rate, not exceeding 20% per annum, determined by
the Directors from the date of forfeiture on the money for the
time being unpaid if the Directors think fit to enforce payment
of the interest and also expenses owing), but that person's
liability
14
<PAGE>
ceases if and when the Company receives payment in full of all
money (including interest and expenses) so payable in respect of
the shares.
Evidence of forfeiture
7.9 A statement in writing declaring that the person making the
statement is a director or a secretary of the Company, and that a
share in the Company has been duly forfeited in accordance with
the Articles on the date stated in the statement, is prima facie
evidence of the facts stated in the statement as against all
persons claiming to be entitled to the share.
Transfer of forfeited share
7.10 The Company may receive the consideration (if any) given for a
forfeited share on any sale or disposition of the share and may
execute a transfer of the share in favour of the person to whom
the share is sold or disposed of.
7.11 On the execution of the transfer, the transferee must be
registered as the holder of the share and is not bound to see to
the application of any money paid as consideration.
7.12 The title of the transferee to the share is not affected by any
irregularity or invalidity in connection with the forfeiture,
sale or disposal of the share.
8 Conversion of shares into stock
Company may convert shares into stock
8.1 The Company may, by resolution in general meeting, convert all or
any of its paid up shares into stock and re-convert any stock
into paid up shares of any nominal value.
Transfer of stock
8.2 Subject to Article 8.3, when shares have been converted into
stock, the provisions of these Articles relating to the transfer
of shares
15
<PAGE>
apply, so far as they are capable of application, to the transfer
of the stock or of any part of the stock.
8.3 The Directors may fix the minimum amount of stock transferable
and restrict or forbid the transfer of fractions of that minimum,
but the minimum must not exceed the aggregate of the nominal
values of the shares from which the stock arose.
Stockholders' rights
8.4 The holders of stock have, according to the amount of the stock
held by them, the same rights, privileges and advantages as
regards dividends, have if they held the shares from which the
stock arose.
8.5 No privilege or advantage (except participation in the dividends
and profits of the Company and in the property of the Company on
winding up) is conferred by any amount of stock that would not,
if existing in shares, have conferred that privilege or
advantage.
Application of Articles to stock
8.6 The provisions of these Articles that are applicable to paid up
shares apply to stock, and references in those provisions to
share and Member include references to stock and stockholder
respectively.
9 Alteration of capital
Company's power to alter capital
9.1 The Company in general meeting may by resolution:
(a) increase its authorised share capital by the creation of new
shares of such amount as is specified in the resolution;
16
<PAGE>
(b) consolidate and divide all or any of its authorised share
capital into shares of a larger amount than its existing
shares;
(c) subdivide all or any of its shares into shares of a smaller
amount than its existing shares but so that in the
subdivision the proportion between the amount paid and the
amount (if any) unpaid on each such share of a smaller
amount is the same as it was in the case of the share from
which the share of a smaller amount is derived; and
(d) cancel shares that, at the date of the passing of the
resolution, have not been taken or agreed to be taken by any
person or have been forfeited and reduce its authorised
share capital by the amount of the shares so cancelled.
Reduction of capital
9.2 Subject to the Corporations Law, the Company in general meeting
may, by special resolution, reduce its share capital, any capital
redemption reserve fund or any share premium account.
10 General meetings
Annual general meeting
10.1 Annual general meetings of the Company are to be held in
accordance with the Corporations Law.
General meeting
10.2 The Directors may convene a general meeting of the Company
whenever they think fit.
Notice of general meeting
17
<PAGE>
10.3 Subject to the provisions of the Corporations Law relating to
special resolutions and agreements for shorter notice, at least
14 days' notice (exclusive of the day on which the notice is
served or deemed to be served and of the day for which notice is
given) specifying the place, day and the hour of the meeting and,
in the case of special business, the general nature of that
business, must be given to such persons as are entitled to
receive notices from the Company.
The non-receipt of notice of a general meeting by, or the
accidental omission to give notice of a general meeting to, a
person entitled to receive notice does not invalidate any
resolution passed at the general meeting.
Special business of general meeting
10.4 All business that is transacted at a general meeting is special
with the exception at an annual general meeting of the
declaration of a dividend, the consideration of the accounts and
the reports of the Directors and the Auditor, the appointment of
the Auditor and the election of Directors.
Requisitioned meeting
10.5 The Directors must, on the written requisition of:
(a) not less than 100 Members holding shares in the Company on
which there has been paid up an average sum, per Member, of
not less than $200; or
(b) a Member who is entitled or Members who are together
entitled, to not less than 5% of the total voting rights of
all Members having at the date of the deposit of the
requisition a right to vote at general meetings;
18
<PAGE>
immediately convene a general meeting of the Company to be held
as soon as practicable but, in any case, not later than two
months after the deposit of the requisition.
Objects of requisitioned meeting
10.6 The requisition for a general meeting must state the objects of
the meeting and must be signed by the requisitionists and
deposited at the Registered Office, and may consist of several
documents in like form each signed by one or more of the
requisitionists.
Convening requisitioned meeting
10.7 If the Directors do not, within 21 days after the deposit of the
requisition, proceed to convene a general meeting the
requisitionists or any of them representing more than one-half of
the total voting rights of all of them may themselves, in the
same manner as nearly as possible as that in which meetings are
to be convened by the Directors, convene a meeting, but a meeting
so convened may not be held after the expiration of three months
from the date of the deposit of the requisition.
Expenses of requisitioned meeting
10.8 Any reasonable expenses incurred by the requisitionists by reason
of the failure of the Directors to convene a general meeting must
be paid to the requisitionists by the Company and any sum so paid
must be retained by the Company out of any sums due or to become
due from the Company by way of fees or other remuneration in
respect of their services to such of the Directors as were in
default.
19
<PAGE>
Postponement or cancellation of meeting
10.9 The Directors may postpone or cancel any general meeting whenever
they think fit (other than a meeting convened as a result of a
requisition under Article 10.5 or by requisitionists under
Article 10.7).
11 Proceedings at general meetings
Representation of Member
11.1 Any Member may be represented at any meeting of the Company by a
proxy or attorney.
11.2 If a body corporate is a Member it may also, by resolution of
its directors or other governing body, authorise such person as
it thinks fit to act as its representative either at a particular
general meeting or at all general meetings of the Company or of
any class of Members.
11.3 A person authorised under Article 11.2 is, in accordance with
that authority and until it is revoked by the body corporate,
entitled to exercise the same powers on behalf of the body
corporate as the body corporate could exercise if it were a
natural person who was a Member.
11.4 Unless the contrary intention appears, a reference to a Member
in the succeeding provisions of this Part 11 means a Member, a
proxy or attorney of a Member or a person appointed under Article
11.2 to represent a body corporate which is a Member.
Quorum
11.5 No business may be transacted at any general meeting unless a
quorum is present comprising two Members present in person or by
proxy, attorney or representative appointed under Article 11.2
and entitled to vote at the meeting. If a quorum
20
<PAGE>
is present at the beginning of a meeting it is deemed present
throughout the meeting unless the chairman of the meeting
otherwise declares, on the chairman's own motion or at the
instance of a Member, proxy, attorney or representative appointed
under Article 11.2.
Failure to achieve quorum
11.6 If a meeting is convened on the requisition of Members and a
quorum is not present within half an hour from the time appointed
for the meeting, the meeting must be dissolved.
11.7 If a meeting is convened in any other case and a quorum is not
present within half an hour from the time appointed for the
meeting:
(a) the meeting must be adjourned to such day, time and place as
the Directors determine or if no determination is made by
them to the same day in the next week at the same time and
place; and
(b) if at the adjourned meeting a quorum is not present within
half an hour from the time appointed for the meeting the
meeting must be dissolved.
Appointment and powers of chairman of general meeting
11.8 If the Directors have elected one of their number as chairman of
their meetings, that person must preside as chairman at every
general meeting.
11.9 If a general meeting is held and:
(a) a chairman has not been elected as provided by Article 11.8;
or
(b) the chairman is not present within 15 minutes after the time
appointed for the holding of the meeting or is unable or
unwilling to act,
21
<PAGE>
then the deputy chairman elected under Article 14.16 (if any)
must act as chairman of the meeting. If there is no such person
or that person is absent or unable or unwilling to act, the
Directors present must elect one of their number to the chairman
of the meeting, or, if no Director is present or if all Directors
present decline to take the chair, the Members present must elect
one of their number to be chairman of the meeting.
Adjournment of general meeting
11.10 The chairman may, with the consent of any meeting at which a
quorum is present, and must if so directed by the meeting,
adjourn the meeting from day to day, time to time and from place
to place, but no business may be transacted at any adjourned
meeting other than the business left unfinished at the meeting
from which the adjournment took place.
11.11 When a meeting is adjourned for 30 days or more, notice of the
adjourned meeting must be given as in the case of an original
meeting.
11.12 Except as provided by Article 11.11, it is not necessary to give
any notice of an adjournment or of the business to be transacted
at any adjourned meeting.
Voting at general meeting
11.13 At any general meeting a resolution put to the vote of the
meeting must be decided on a show of hands unless a poll is
(before or on the declaration of the result of the show of hands)
demanded:
(a) by the chairman;
(b) by not less than five Members having the right to vote at
the meeting;
22
<PAGE>
(c) by a Member or Members present who are together entitled to
not less than 10% of the total voting rights of all the
Members having the right to vote at the meeting; or
(d) by a Member or Members present and holding shares in the
Company conferring a right to vote at the meeting, being
shares on which an aggregate sum has been paid up equal to
not less than 10% of the total sum paid up on all the shares
conferring that right.
Unless a poll is properly demanded, a declaration by the chairman
that a resolution has on a show of hands been carried or carried
unanimously, or by a particular majority, or lost, and an entry
to that effect in the book containing the minutes of the
proceedings of the Company, is conclusive evidence of the fact
without proof of the number or proportion of the votes recorded
in favour of or against the resolution.
Questions decided by majority
11.14 Subject to the requirements of the Corporations Law in relation
to special resolutions, a resolution is taken to be carried if
the proportion that the number of votes in favour of the
resolution bears to the total number of votes on the resolution
exceeds one half.
Poll
11.15 If a poll is properly demanded, it must be taken in such manner
and (subject to Article 11.16) either at once or after an
interval or adjournment or otherwise as the chairman directs, and
the result of the poll is the resolution of the meeting at which
the poll was demanded.
11.16 A poll demanded on the election of a chairman or on a question
of adjournment must be taken immediately.
23
<PAGE>
11.17 The demand for a poll may be withdrawn.
Equality of votes
11.18 If there is an equality of votes, whether on a show of hands or
on a poll, the chairman of the meeting is not entitled to a
casting vote in addition to any votes to which the chairman is
entitled as a Member or proxy or attorney or representative of a
Member.
Entitlement to vote
11.19 Subject to any rights or restrictions for the time being attached
to any class or classes of shares and to these Articles:
(a) on a show of hands every person present who is a Member or a
proxy, attorney or representative of a Member has one vote;
and
(b) on a poll every person present who is a Member or proxy,
attorney or representative of a Member has one vote for each
share that the person holds or represents (as the case may
be).
Joint shareholders' vote
11.20 In the case of joint holders of a share in the Company the vote
of the senior who tenders a vote, whether in person or by proxy,
attorney or representative, must be accepted to the exclusion of
the votes of the other joint holders and, for this purpose,
seniority is determined by the order in which the names stand in
the Register.
Vote of shareholder of unsound mind
11.21 If a Member is of unsound mind or is a person whose person or
estate is liable to be dealt with in any way under the law
relating to mental
24
<PAGE>
health then the Member's committee or trustee or such other
person as properly has the management of the Member's estate may
exercise any rights of the Member in relation to a general
meeting as if the committee, trustee or other person were the
Member.
Effect of unpaid call
11.22 A Member is not entitled to vote at a general meeting unless all
calls and other sums presently payable by the Member in respect
of shares in the Company have been paid.
Objection to voting qualification
11.23 An objection may be raised to the qualification of a voter only
at the meeting or adjourned meeting at which the vote objected to
is given or tendered.
11.24 Any such objection must be referred to the chairman of the
meeting, whose decision is final.
11.25 A vote not disallowed under such an objection is valid for all
purposes.
Appointment of proxy
11.26 An instrument appointing a proxy must be in writing under the
hand of the appointor or of the appointor's attorney duly
authorised in writing or, if the appointor is a corporation,
either under seal or under the hand of an officer or attorney
duly authorised. A proxy need not be a Member.
11.27 An instrument appointing a proxy may specify the manner in which
the proxy is to vote in respect of a particular resolution and,
if an instrument of proxy so provides, the proxy is not entitled
to vote on the resolution except as specified in the instrument.
25
<PAGE>
11.28 An instrument appointing a proxy is deemed to confer authority
to demand or join in demanding a poll.
11.29 An instrument appointing a proxy must be in the form approved by
the Directors from time to time.
Deposit of proxy and other instruments
11.30 An instrument appointing a proxy may not be treated as valid
unless the instrument, and the power of attorney or other
authority (if any) under which the instrument is signed or a
copy of that power or authority certified as a true copy by
statutory declaration is or are received by the Company not less
than 48 hours before the time for holding the meeting or
adjourned meeting at which the person named in the instrument
proposes to vote at the Registered Office or at such other place
as is specified for that purpose in the notice convening the
meeting.
Validity of vote in certain circumstances
11.31 A vote given in accordance with the terms of an instrument of
proxy or of a power of attorney is valid notwithstanding the
previous death or unsoundness of mind of the principal, the
revocation of the instrument (or of the authority under which
the instrument was executed) or of the power, or the transfer of
the share in respect of which the instrument or power is given,
if no intimation in writing of the death, unsoundness of mind,
revocation or transfer has been received by the Company at its
Registered Office before the commencement of the meeting or
adjourned meeting at which the instrument is used or the power
is exercised.
Director entitled to notice of meeting
11.32 A Director is entitled to receive notice of and to attend
all general meetings and all separate
26
<PAGE>
general meetings of the holders of any class of shares in the
Company and is entitled to speak at those meetings.
Resolution in writing
11.33 Subject to the provisions of the Corporations Law, a resolution
in writing signed by all the Members is as valid and effectual
as if it had been passed at a general meeting of the Company
duly convened and held at the time at which the written
resolution was last signed by a Member. Any such resolution may
consist of several documents in like form, each signed by one or
more Members.
12 Directors
Number of Directors
12.1 The number of Directors must not be less than one. The names of
the first Directors will be determined in writing by the
subscriber to the memorandum of association of the Company and
those Directors will continue in office subject to these
Articles. The Company in general meeting may, by resolution,
increase or reduce the number of Directors.
Share qualification of Directors
12.2 A Director is not required to hold any share in the Company.
Appointment of Director
12.3 The Company in general meeting may by resolution and the
Directors may at any time appoint any person to be a Director,
either to fill a casual vacancy or as an addition to the
existing Directors, but so that the total number of
27
<PAGE>
Directors does not at any time exceed the number determined in
accordance with Article 12.1.
Removal of Director
12.4 The Company in general meeting may by resolution remove any
Director from office and may by resolution appoint another
person in that Director's stead.
Remuneration of Directors
12.5 The Directors may be paid such remuneration as is determined
from time to time by the Company in general meeting. That
remuneration is deemed to accrue from day to day. A Director who
retires, and is not reappointed in accordance with these
Articles, may be paid a retirement benefit in recognition of
past services in the amount determined by the Directors, but not
exceeding the amount permitted by the Corporations Law.
12.6 The Directors may also be paid all travelling and other expenses
properly incurred by them in attending, participating in and
returning from meetings of the Directors or any committee of the
Directors or general meetings of the Company or otherwise in
connection with the business of the Company.
Director's interests
12.7 No Director is disqualified by the Director's office and the
fiduciary relationship established by it from holding any office
or place of profit (other than that of Auditor) under the
Company. Any Director may (subject to the Corporations Law):
(a) be or become a director of or otherwise hold office or a
place of profit in any other company promoted by the
Company or in which
28
<PAGE>
the Company may be interested as vendor, shareholder or
otherwise;
(b) contract or make any arrangement with the Company whether as
vendor, purchaser, broker, solicitor or accountant or other
professional person or otherwise and any contract or
arrangement entered or to be entered into by or on behalf of
the Company in which any Director is in any way interested
is not avoided for that reason; and
(c) participate in any association, institution, fund, trust or
scheme for past or present employees or Directors of the
Company, a related body corporate or any of their respective
predecessors in business or their dependants or persons
connected with them.
12.8 Any Director who:
(a) holds any office or place of profit under the Company;
(b) holds any office or place of profit referred to in Article
12.7(a);
(c) is involved in a contract or arrangement referred to in
Article 12.7(b); or
(d) participates in an association or otherwise under Article
12.7( c),
is not by reason only of any of those facts or any interest
resulting from it or the fiduciary relationship established by it
liable to account to the Company for any remuneration or other
benefits accruing from it.
12.9 Each Director must disclose that Director's interests to the
Company in accordance with the Corporations Law and the Secretary
must record any such declaration in the minutes of the relevant
meeting.
29
<PAGE>
12.10 A Director may only vote in respect of any contract or proposed
contract or arrangement in which the Director has a material
interest if the Director has first disclosed the interest to the
Directors in accordance with the Corporations Law and if the
Director is not permitted to vote under this Article but does so
vote then that vote may not be counted. Directors may vote in
respect of a contract for insurance of the company or its
officers against a liability incurred by officers as officers of
the Company or a related body corporate.
12.11 The restrictions contained in Article 12.10 may at any time or
times be suspended or relaxed to any extent and either
prospectively or retrospectively by resolution of the Company in
general meeting.
12.12 A Director or a Director's firm may act in a professional
capacity (other than as Auditor) for the Company and a Director
or a Director's firm is entitled to remuneration for professional
services as if the relevant Director was not a Director.
12.13 A Director may, notwithstanding the Director's interest, and
whether or not the Director is entitled to vote or does vote,
participate in the execution of any instrument by or on behalf of
the Company and whether through signing or sealing the same or
otherwise.
Vacation of office of Director
12.14 In addition to the circumstances in which the office of a
Director becomes vacant under the Corporations Law, the office of
a Director becomes vacant if the Director:
(a) becomes of unsound mind or a person whose person or estate
is liable to be dealt with in any way under the law relating
to mental health;
30
<PAGE>
(b) resigns from the office by notice in writing to the Company;
or
(c) is absent without the consent of the remaining Directors
from meetings of the Directors held during a period of six
months.
13 Powers and duties of Directors
Directors to manage Company
13.1 Subject to the Corporations Law and to any other provision of
these Articles the business of the Company is managed by the
Directors, who may exercise all such powers of the Company as are
not, by the Corporations Law or by these Articles, required to be
exercised by the Company in general meeting.
13.2 Without limiting the generality of Article 13.1, the Directors
may exercise all the powers of the Company to borrow or raise
money, to charge any property or business of the Company or all
or any of its uncalled capital and to issue debentures or give
any other security for a debt, liability or obligation of the
Company or of any other person.
Appointment of attorney
13.3 The Directors may, by power of attorney, appoint any person or
persons to be the attorney or attorneys of the Company for such
purposes, with such powers, authorities and discretions (being
powers, authorities and discretions vested in or exercisable by
the Directors), and for such period and subject to such
conditions as they think fit.
13.4 Any such power of attorney may contain such provisions for the
protection and convenience of persons dealing with the attorney
as the Directors think fit and may also authorise the
31
<PAGE>
attorney to delegate all or any of the powers, authorities and
discretions vested in the attorney.
Minutes
13.5 The Directors must cause minutes to be made:
(a) of the names of the Directors present at or involved in all
general meetings and all meetings of the Directors; and
(b) of all proceedings of general meetings and of meetings of
Directors,
(c) and cause those minutes to be entered, within one month
after the relevant meeting is held, in the minute book.
13.6 The minutes referred to in Article 13.5 must be signed by the
chairman of the meeting at which the proceedings took place or by
the chairman of the next succeeding meeting.
Execution of Company cheques etc
13.7 All cheques, promissory notes, bankers' drafts, bills of exchange
and other negotiable instruments, and all receipts for money paid
to the Company, must be signed, drawn, accepted, endorsed or
otherwise executed, as the case may be, in such manner and by
such persons as the Directors determine from time to time.
14 Proceedings of Directors
Directors' meetings
14.1 The Directors may meet together for the despatch of business and
adjourn and otherwise regulate their meetings as they think fit.
32
<PAGE>
14.2 A Director may at any time, and the Secretary must on the
requisition of a Director, convene a meeting of the Directors.
Questions decided by majority
14.3 Subject to these Articles, questions arising at a meeting of
Directors are to be decided by a majority of votes of Directors
involved and voting and any such decision is for all purposes
deemed a decision of the Directors.
14.4 An Alternate Director involved in any meeting of Directors has
one vote for each Director for which that person is an Alternate
Director and if that person is a Director also has one vote as a
Director.
14.5 In the event of an equality of votes the chairman of the meeting
does not have a casting vote.
Alternate Directors
14.6 A Director may appoint a person (whether a Member of the Company
or not) to be an Alternate Director in the Director's place
during such period as the Director thinks fit.
14.7 An Alternate Director is entitled to notice of all meetings of
the Directors and, if the appointor is not involved in such a
meeting, is entitled to participate and vote in the appointor's
stead.
14.8 An Alternate Director may exercise any powers that the appointor
may exercise and in the exercise of any such power the Alternate
Director is an officer of the Company and is not deemed an agent
of the appointor.
14.9 An Alternate Director is not required to hold any share in the
Company.
33
<PAGE>
14.10 An Alternate Director is subject in all respects to the
conditions attaching to the Directors generally except that an
Alternate Director is not entitled to any remuneration under
Article 12.5 otherwise than from the Alternate Director's
appointor.
14.11 The appointment of an Alternate Director may be terminated at
any time by the appointor notwithstanding that the period of the
appointment of the Alternate Director has not expired, and
terminates in any event if the appointor vacates office as a
Director.
14.12 An appointment, or the termination of an appointment, of an
Alternate Director must be effected by a notice in writing
signed by the Director who makes or made the appointment and
served on the Company.
14.13 The notice of appointment or termination of appointment of an
Alternate Director may be served on the Company by leaving it at
the Registered Office or by forwarding it by facsimile
transmission to the Registered Office and in the case of a
facsimile transmission, the appearance at the end of the message
of the name of the Director appointing or terminating the
appointment is sufficient evidence that the Director has signed
the notice.
Quorum for Directors' meetings
14.14 At a meeting of Directors, the number of Directors whose
involvement is necessary to constitute a quorum is two, unless
the Company has only one director, or such greater number as is
determined by the Directors from time to time. Notwithstanding
Article 12.10, a Director who has a material interest in any
contract or proposed contract or arrangement may be counted in
the quorum involved in any Directors' meeting at which such
contract, proposed contract or arrangement is considered.
34
<PAGE>
Remaining Directors may act
14.15 In the event of a vacancy or vacancies in the office of a
Director or offices of Directors, the remaining Director or
Directors may act but, if the number of remaining Directors is
not sufficient to constitute a quorum at a meeting of Directors,
they may act only for the purpose of:
(a) increasing the number of Directors to a number sufficient to
constitute such a quorum; or
(b) convening a general meeting of the Company.
Chairman of Directors
14.16 The Directors must elect one of their number as chairman of
their meetings and may determine the period for which the person
elected as chairman is to hold office. The Directors may also
elect one of their number as deputy-chairman of their meetings
and may determine the period for which the person elected as
deputy-chairman is to hold office.
14.17 When a Directors' meeting is held and:
(a) a chairman has not been elected as provided by Article
14.16; or
(b) the chairman is not present within ten minutes after the
time appointed for the holding of the meeting or is unable
or unwilling to act,
the deputy-chairman (if any) must act as chairman of the
meeting. If there is no such person or that person is absent or
unable or unwilling to act, the Directors involved must elect
one of their number to be a chairman of the meeting.
Directors' committees
35
<PAGE>
14.18 The Directors may delegate any of their powers, other than
powers required by law to be dealt with by the directors as a
board, to a committee or committees consisting of at least one
of their number and such other persons as they think fit.
14.19 A committee to which any powers have been so delegated must
exercise the powers delegated in accordance with any directions
of the Directors and a power so exercised is deemed to have been
exercised by the Directors.
14.20 The members of such a committee may elect one of their number as
chairman of their meetings.
14.21 If such a meeting is held and:
(a) a chairman has not been elected as provided by Article
14.20; or
(b) the chairman is not present within ten minutes after the
time appointed for the holding of the meeting or is unable
or unwilling to act,
the members involved may elect one of their number to be
chairman of the meeting.
14.22 A committee may meet and adjourn as it thinks proper.
14.23 Questions arising at a meeting of a committee are to be
determined by a majority of votes of the members involved and
voting.
14.24 In the event of there being an equality of votes, the chairman,
in addition to the chairman's deliberative vote, has a casting
vote.
Written resolution by Directors
14.25 A resolution in writing signed by all the Directors who are
eligible to vote on the resolution is as valid and effectual as
if it had been passed at a meeting of the Directors held at
36
<PAGE>
the time when the written resolution was last signed by an
eligible Director. Any such resolution may consist of several
documents in like form, each signed by one or more Directors.
Directors' meetings defined
14.26 The Directors may conduct meetings without Directors being in
the physical presence of other Directors provided that all the
Directors involved in the meeting are able simultaneously to
hear each other and to participate in discussion.
14.27 Article 14.26 applies to meetings of Directors' committees as if
all members were Directors.
Validity of acts of Directors
14.28 All acts done by any meeting of the Directors or of a committee
of Directors or by any person acting as a Director are,
notwithstanding that it is afterwards discovered that there was
some defect in the appointment of a person to be a Director or a
member of the committee, or to act as a Director, or that a
person so appointed was disqualified, as valid as if the person
had been duly appointed and was qualified to be a Director or to
be a member of the committee.
Appointment of Managing and Executive Directors
14.29 The Directors may from time to time appoint one or more of their
number to the office of Managing Director or Executive Director
for such period and on such terms as they think fit, and,
subject to the terms of any agreement entered into in a
particular case, may revoke any such appointment.
Remuneration of Managing and Executive Directors
37
<PAGE>
14.30 A Managing Director or Executive Director may, subject to the
terms of any agreement entered into in a particular case,
receive such remuneration (whether by way of salary, commission
or participation in profits, or partly in one way and partly in
another) as the Directors determine.
Powers of Managing and Executive Directors
14.31 The Directors may, on such terms and conditions and with such
restrictions as they think fit, confer on a Managing Director or
an Executive Director any of the powers exercisable by them.
14.32 Any powers so conferred may be concurrent with, or be to the
exclusion of, the powers of the Directors.
14.33 The Directors may at any time withdraw or vary any of the powers
so conferred on a Managing Director or an Executive Director.
15 Secretary
Appointment of Secretary
15.1 There must be at least one Secretary of the Company who may be
appointed by the Directors for such term, at such remuneration
and on such conditions as they think fit.
Suspension and removal of Secretary
15.2 The Directors have power to suspend or remove a Secretary.
Powers and duties of Secretary
15.3 The Directors may vest in a Secretary such powers, duties and
authorities as they may from
38
<PAGE>
time to time determine and a Secretary must exercise all such
powers and authorities subject at all times to the control of the
Directors.
Secretary to attend meetings
15.4 A Secretary is entitled to participate in all meetings of the
Directors and all general meetings of the Company and may be
heard on any matter.
16 Common seal and official seal
Custody of common seal
16.1 The Directors must provide for the safe custody of the common
seal.
Use of common seal
16.2 The common seal may be used only by the authority of the
Directors, or of a committee of the Directors authorised by the
Directors to authorise the use of the common seal, and every
document to which the common seal is affixed must be signed by a
Director and be countersigned by another Director, a Secretary or
another person appointed by the Directors to countersign that
document or a class of documents in which that document is
included.
16.2A The sole director, if only one person is appointed to the office
of director and that person is also the sole secretary of the
Company, may be the sole signatory to documents to which the
common seal is affixed.
Use of official seals
16.3 The Company may have for use outside the State in place of the
common seal one or more official
39
<PAGE>
seals, each of which must be a facsimile of the common seal with
the addition on its face of the name of every place where it is
to be used.
16.4 The Company may by writing under its common seal empower a person
in a place either generally or in respect of a specified matter
to affix its official seal for that place to any instrument to
which the Company is a party.
17 Inspection of records
Inspection by Members
17.1 Except as otherwise required by the Corporations Law, the
Directors may determine whether and to what extent, and at what
times and places and under what conditions, the accounting
records and other documents of the Company or any of them will be
open to the inspection of Members other than Directors, and a
Member other than a Director does not have the right to inspect
any document of the Company except as provided by law or
authorised by the Directors or by the Company in general meeting.
18 Dividends and reserves
Declaration of final dividend
18.1 Subject to the rights of persons (if any) entitled to shares with
special rights to dividend, the Directors may declare a final
dividend out of profits in accordance with the Corporations Law
and may authorise the payment or crediting by the Company to the
Members of such a dividend.
Directors may authorise interim dividend
18.2 The Directors may authorise the payment or crediting by the
Company to the Members of such
40
<PAGE>
interim dividends as appear to the Directors to be justified by
the profits of the Company.
No interest on dividends
18.3 Interest may not be paid by the Company in respect of any
dividend, whether final or interim.
Reserves and profits carried forward
18.4 The Directors may, before declaring any dividend, set aside out
of the profits of the Company such sums as they think proper as
reserves, to be applied, at the discretion of the Directors, for
any purpose for which the profits of the Company may be properly
applied.
18.5 Pending any such application, the reserves may, at the discretion
of the Directors, be used in the business of the Company or be
invested in such investments as the Directors think fit.
18.6 The Directors may carry forward so much of the profits remaining
as they consider ought not to be distributed as dividends without
transferring those profits to a reserve.
Calculation and apportionment of dividends
18.7 Subject to the rights of person (if any) entitled to shares with
special rights to dividend and to the terms of any issue of
shares to the contrary all dividends are to be declared and paid
according to the amounts paid or credited as paid on the shares
in respect of which the dividend is paid, and are to be
apportioned and paid proportionately to the amounts paid or
credited as paid on the shares during any portion or portions of
the period in respect of which the dividend is paid.
41
<PAGE>
18.8 An amount paid or credited as paid on a share in advance of a
call is not to be taken as paid or credited as paid on the share
for the purposes of Article 18.7.
Deductions from dividends
18.9 The Directors may deduct from any dividend payable to a Member
all sums of money (if any) presently payable by that Member to
the Company on account of calls or otherwise in relation to
shares in the Company.
Distribution of specific assets
18.10 The Directors, when paying or declaring a dividend, may direct
payment of a dividend wholly or partly by the distribution of
specific assets, including paid up shares in, or debentures of,
any other corporation.
18.11 If a difficulty arises in regard to such a distribution, the
Directors may settle the matter as they consider expedient and
fix the value for distribution of the specific assets or any part
of those assets and may determine that cash payments will be made
to any Members on the basis of the value so fixed in order to
adjust the rights of all parties, and may vest any such specific
assets in trustees as the Directors consider expedient. If a
distribution of specific assets to a particular Member or Members
is illegal or, in the Directors' opinion, impracticable then the
Directors may make a cash payment to that Member or Members on
the basis of the cash amount of the dividend instead of the
distribution of specific assets.
Payment by cheque and receipts from joint holders
18.12 Any dividend, interest or other money payable in cash in respect
of shares may be paid by cheque sent through the post directed:
42
<PAGE>
(a) to the address of the holder as shown in the Register or, in
the case of joint holders, to the address shown in the
Register as the address of the joint holder first named in
the Register; or
(b) to such other address as the holder or joint holders in
writing directs or direct.
18.13 Any one of two or more joint holders may give effectual receipts
for any dividends, interest or other money payable in respect of
the shares held by them as joint holders.
Unclaimed dividends
18.14 All dividends declared but unclaimed may be invested by the
Directors as they think fit for the benefit of the Company until
claimed or until required to be dealt with in accordance with any
law relating to unclaimed moneys.
19 Capitalisation of profits
Capitalisation of reserves and profits
19.1 The Directors may resolve that it is desirable to capitalise any
sum, being the whole or a part of the amount for the time being
standing to the credit of any reserve account or the profit and
loss account or otherwise available for distribution to Members,
and that the sum is applied, in any of the ways mentioned in
Article 19.2, for the benefit of Members in the proportions to
which those Members would have been entitled in a distribution of
that sum by way of dividend.
19.2 The ways in which a sum may be applied for the benefit of Members
under Article 19.1 are:
(a) in paying up any amounts unpaid on shares held by Members;
43
<PAGE>
(b) in paying up in full unissued shares or debentures to be
issued to Members as fully paid; or
(c) partly as mentioned in paragraph (a) and partly as mentioned
in paragraph (b).
19.3 The Directors may do all things necessary to give effect to the
resolution and, in particular, to the extent necessary to adjust
the rights of the Members among themselves, may:
(a) issue fractional certificates or make cash payments in cases
where shares or debentures become issuable in fractions; and
(b) authorise any person to make, on behalf of all or any of the
Members entitled to any further shares or debentures on the
capitalisation, an agreement with the Company providing for
the issue to them, credited as fully paid up, of any such
further shares or debentures or for the payment up by the
Company on their behalf of the amounts or any part of the
amounts remaining unpaid on their existing shares by the
application of their respective proportions of the sum
resolved to be capitalised, and any such agreement is
effective and binding on all the Members concerned.
20 Notices
Service of notices
20.1 A notice may be given by the Company to any Member or other
person receiving notice under these Articles either by serving it
on the person personally or by sending it by post or facsimile
transmission to the person at their address as shown in the
Register or the address supplied by the person to the Company for
the giving of notices to the person.
44
<PAGE>
20.2 If a notice is sent by post, service of the notice is deemed to
be effected by properly addressing, prepaying, and posting a
letter containing the notice, and the notice is deemed to have
been served on the day after the date of its posting.
20.3 If a notice is sent by facsimile transmission, service of the
notice is deemed to be effected by properly addressing the
facsimile transmission and transmitting same and to have been
served on the day following its despatch.
20.4 A notice may be given by the Company to the joint holders of a
share by giving the notice to the joint holder first named in the
Register in respect of the share.
20.5 Every person who by operation of law, transfer or other means
whatsoever becomes entitled to any share is absolutely bound by
every notice given in accordance with this Article to the person
from whom that person derives title prior to registration of that
person's title in the Register.
Persons entitled to notice of general meeting
20.6 Notice of every general meeting must be given in a manner
authorised by Article 20.1 and in accordance with the
Corporations Law to:
(a) every Member;
(b) every Director and Alternate Director; and
(c) the Auditor.
20.7 No other person is entitled to receive notices of general
meetings.
21 Winding up
Distribution of assets
45
<PAGE>
21.1 If the Company is wound up, the liquidator may, with the sanction
of a special resolution of the Company, divide among the Members
in kind the whole or any part of the property of the Company and
may for that purpose set such value as the liquidator considers
fair on any property to be so divided and may determine how the
division is to be carried out as between the Members or different
classes of Members.
21.2 The liquidator may, with the sanction of a special resolution of
the Company, vest the whole or any part of any such property in
trustees on such trusts for the benefit of the contributories as
the liquidator thinks fit, but so that no Member is compelled to
accept any shares or other securities in respect of which there
is any liability.
22 Indemnity
Indemnity of officers
22.1 Every person who is or has been a director, secretary or
executive officer of the Company and its Related Bodies Corporate
may, if the Directors so determine, be indemnified, to the
maximum extent permitted by law, out of the property of the
Company against any liabilities for costs and expenses incurred
by that person:
(a) in defending any proceedings relating to that person's
position with the Company, whether civil or criminal, in
which judgment is given in that person's favour or in which
that person is acquitted or which are withdrawn before
judgment; or
(b) in connection with any administrative proceedings relating
to that person's position with the Company, except
proceedings which give rise to civil or criminal proceedings
against that person in which judgment is not given in that
person's
46
<PAGE>
favour or in which that person is not acquitted or which
arise out of conduct involving a lack of good faith; or
(c) in connection with any application in relation to any
proceedings relating to that person's position with the
Company, whether civil or criminal, in which relief is
granted to that person under the Corporations Law by the
court.
22.2 Every person who is or has been a director, secretary or
executive officer of the Company and its Related Bodies Corporate
may, if the Directors so determine, be indemnified, to the
maximum extent permitted by law, out of the property of the
Company against any liability to another person (other than the
Company or its Related Bodies Corporate) as such an officer
unless the liability arises out of conduct involving a lack of
good faith.
22.3 The Company may pay a premium for a contract insuring a person
who is or has been a director, secretary or executive officer of
the Company and its Related Bodies Corporate against:
(a) any liability incurred by that person as such an officer
which does not arise out of conduct involving a wilful
breach of duty in relation to the Company or a contravention
of sections 232(5) or (6) of the Corporations Law; and
(b) any liability for costs and expenses incurred by that person
in defending proceedings relating to that person's position
with the Company, whether civil or criminal, and whatever
their outcome.
47
<PAGE>
The persons whose name and address is subscribed, being the subscriber to the
Memorandum of Association, hereby agrees to the foregoing Articles of
Association.
Rodney Harold Keller
1705/265 Exhibition Street
Melbourne Vic 3000
Signature: Date: 16 June 1998
Witness to above signature:
Narelle Melissa Bridges
42/202 Wattletree Road
Malvern Vic 3144
Occupation: Para Legal
Signature: Date: 16 June 1998
48
<PAGE>
<TABLE>
<CAPTION>
Contents
<S> <C>
1 Preliminary 1
Definitions 1
Interpretation 2
Table A not to apply 3
Proprietary company 3
2 Share capital and variation of rights 3
Directors to issue shares 3
Preference shares 4
Variation of rights 4
Commission and brokerage 5
Recognition and disclosure of interests 6
Right to share and option certificate 6
Joint holders of shares 6
3 Lien 7
Lien on share 7
Sale under lien 7
Transfer on sale under lien 8
Proceeds of sale 8
4 Calls on shares 8
Directors to make calls 8
Time of call 9
Members' liability 9
Interest on default 9
Fixed installments deemed calls 9
Differentiation between shareholders as to calls 10
Prepayment of calls 10
5 Transfer of shares 10
Forms of instrument of transfer 10
Registration procedure 11
Directors may decline to register 11
6 Transmission of shares 11
Transmission of shares on death of holder 11
Right to registration on death or bankruptcy 12
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Effect of transmission 13
7 Forfeiture of shares 13
Notice requiring payment of call 13
Forfeiture for failure to comply with notice 14
Cancellation of forfeiture 14
Effect of forfeiture on former holder's liability 14
Evidence of forfeiture 15
Transfer of forfeited share 15
8 Conversion of shares into stock 15
Company may convert shares into stock 15
Transfer of stock 15
Stockholders' rights 16
Application of Articles to stock 16
9 Alteration of capital 16
Company's power to alter capital 16
Reduction of capital 17
10 General meetings 17
Annual general meeting 17
General meeting 17
Notice of general meeting 17
Special business of general meeting 18
Requisitioned meeting 18
Objects of requisitioned meeting 19
Convening requisitioned meeting 19
Expenses of requisitioned meeting 19
Postponement or cancellation of meeting 20
11 Proceedings at general meetings 20
Representation of Member 20
Quorum 20
Failure to achieve quorum 21
Appointment and powers of chairman of general meeting 21
Adjournment of general meeting 22
Voting at general meeting 22
Questions decided by majority 23
Poll 23
Equality of votes 24
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Entitlement to vote 24
Joint shareholder's vote 24
Vote of shareholder of unsound mind 24
Effect of unpaid call 25
Objection to voting qualification 25
Appointment of proxy 25
Deposit of proxy and other instruments 26
Validity of vote in certain circumstances 26
Director entitled to notice of meeting 26
Resolution in writing 27
12 The Directors 27
Number of Directors 27
Share qualification of Directors 27
Appointment of Director 27
Removal of Director 28
Remuneration of Directors 28
Director's interests 28
Vacation of office of Director 30
13 Powers and duties of Directors 31
Directors to manage Company 31
Appointment of attorney 31
Minutes 32
Execution of Company cheques etc 32
14 Proceedings of Directors 32
Directors' meetings 32
Questions decided by majority 33
Alternate Directors 33
Quorum for Directors' meetings 34
Remaining Directors may act 35
Chairman of Directors 35
Directors' committees 35
Written resolution by Directors 36
Directors' meetings defined 37
Validity of acts of Directors 37
Appointment of Managing and Executive Directors 37
Remuneration of Managing and Executive Directors 37
Powers of Managing and Executive Directors 38
15 Secretary 38
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Appointment of Secretary 38
Suspension and removal of Secretary 38
Powers and duties of Secretary 38
Secretary to attend meetings 39
16 Common seal and official seal 39
Custody of common seal 39
Use of common seal 39
Use of official seals 39
17 Inspection of records 40
Inspection by Members 40
18 Dividends and reserves 40
Declaration of final dividend 40
Directors may authorize interim dividend 40
No interest on dividends 41
Reserves and profits carried forward 41
Calculation and apportionment of dividends 41
Deductions from dividends 42
Distribution of specific assets 42
Payment by cheque and receipts from joint holders 42
Unclaimed dividends 43
19 Capitalization of profits 43
Capitalization of reserves and profits 43
20 Notices 44
Service of notices 44
Persons entitled to notice of general meeting 45
21 Winding up 45
Distribution of assets 45
22 Indemnity 46
Indemnity of officers 46
</TABLE>
<PAGE>
EXHIBIT B-203
Certificate of Registration of a Company
Corporations Law Sub-section 121(1)
This is to certify that
GPU GASNET TRADING PTY LTD
Australian Company Number 083 009 303
is a registered company under Division 1 of Part 2.2 of the Corporations Law of
Victoria and because of its registration it is an incorporated company.
The company is limited by shares.
The company is a proprietary company.
The day of commencement of registration is the seventeenth day of June 1998.
Given under the seal of the Australian Securities Commission on this seventeenth
day of June, 1998.
<PAGE>
Memorandum
and
Articles of Association
of
GPU GasNet Trading Pty Ltd
A Company Limited by Shares
Mallesons Stephen Jaques
Solicitors
Rialto
Level 28, North Tower
525 Collins Street
Melbourne Vic 3000
Telephone (03) 9643 4000
Fax (03) 9643 5999
DX 101 Melbourne
Ref NMB:RJK
<PAGE>
Memorandum of Association
of
GPU GasNet Trading Pty Ltd
A Company Limited by Shares
1. The name of the company is GPU GasNet Trading Pty Ltd
2. The capital of the company is $10,000,000 divided into:
100 ordinary shares of $1.00 each;
9,999,900 unclassified shares;
3. The liability of the members of the company is limited.
The subscriber whose name and address is set out below wishes to form a company
under this memorandum of association and respectively agrees to take the number
of shares in the capital of the company set out opposite his name.
Rodney Harold Keller One hundred (100) ordinary shares of
1705/265 Exhibition Street $1.00 each
Melbourne Vic 3000
Occupation: Director
Signature Date: 16 June 1998
Witness to above signature:
Narelle Melissa Bridges
42/202 Wattletree Road
Malvern Vic 3144
Occupation: Para Legal
Signature Date: 16 June 1998
<PAGE>
Index of Articles of Association
1 Preliminary 1
2 Share capital and variation of rights 3
3 Lien 6
4 Calls on shares 8
5 Transfer of shares 10
6 Transmission of shares 11
7 Forfeiture of shares 13
8 Conversion of shares into stock 15
9 Alteration of capital 16
10 General meetings 17
11 Proceedings at general meetings 20
12 The Directors 27
13 Powers and duties of Directors 31
14 Proceedings of Directors 32
15 Secretary 38
16 Common seal and official seal 39
17 Inspection of records 40
18 Dividends and reserves 40
19 Capitalization of profits 43
20 Notices 44
21 Winding up 45
22 Indemnity 46
<PAGE>
Articles of Association
of
GPU GasNet Trading Pty Ltd
A Company Limited by Shares
1 Preliminary
Definitions
1.1 The following words have these meanings in these Articles unless
the contrary intention appears.
Alternate Director means a person appointed as alternate director
under Article 14.6;
Articles means these articles of association as amended from time
to time, and a reference to a particular article has a
corresponding meaning;
Auditor means the auditor or auditors for the time being of the
Company;
Company means the above named company;
Director means a director for the time being of the Company, and
where appropriate includes an Alternate Director;
Executive Director means a person appointed as executive director
under Article 14.29;
Managing Director means a person appointed as a managing director
under Article 14.29;
Member means a person for the time being entered in the Register
as a member of the Company;
Register means the register of members of the Company to be kept
under the Corporations Law and if appropriate includes a branch
register;
1
<PAGE>
Registered Office means the registered office for the time being
of the Company;
Secretary means a person appointed by the Directors under Article
15.1 to perform the duties of secretary of the Company; and
State means the State or Territory in which the Company is from
time to time incorporated.
Interpretation
1.2 In these Articles:
(a) words importing any gender include all other genders;
(b) the word person includes a firm, a body corporate, and
unincorporated association or an authority;
(c) the singular includes the plural and vice versa; and
(d) a reference to a statute or code or the Corporations Law (or
to a provision of same) means the statute, code or the
Corporations Law (or provision of same) as modified or
amended and in operation for the time being, or any statute,
code or provision enacted (whether by the State or the
Commonwealth of Australia) in its place and includes any
regulation or rule for the time being in force under the
statute, code or the Corporations Law.
1.3 Unless the contrary intention appears in these Articles, an
expression has, in a provision of these Articles that deals with
a matter dealt with by a particular provision of the Corporations
Law, the same meaning as in that provision of the Corporations
Law.
1.4 Headings are inserted for convenience and do not affect the
interpretation of these Articles.
Table A not to apply
2
<PAGE>
1.5 The regulations contained in Table A in Schedule 1 to the
Corporations Law do not apply to the Company.
Proprietary company
1.6 The Company is a proprietary company and accordingly;
(a) the right to transfer shares is restricted under these
Articles;
(b) the number of Members of the Company (excluding employees of
the Company or a subsidiary and former employees who while
in the employment of the Company or a subsidiary became and
have continued to be Members) is limited to 50 and joint
holders of a share are counted as one person;
(c) any invitation to the public to subscribe for, and any offer
to the public to accept subscriptions for any shares in, or
debentures of, the Company is prohibited; and
(d) any invitation to the public to deposit money with, and any
offer to the public to accept deposits of money with, the
Company is prohibited.
2 Share capital and variation of rights
Directors to issue shares
2.1 Without prejudice to any special rights previously conferred on
the holders of any existing shares or class of shares but subject
to the Corporations Law, or as the Company in general meeting may
when authorizing any issue of shares otherwise direct, shares in
the Company are under the control of the Directors who may allot
or dispose of all or any of the same to such persons at such
times and on such terms and
3
<PAGE>
conditions and having attached to them such preferred, deferred
or other special rights or such restrictions, whether with regard
to dividend, voting, return of capital or otherwise and at a
premium or at par or at a discount as the Directors think fit.
2.2 The Directors have the right to grant to any person options or
other securities with rights of conversion to shares or pre-
emptive rights to any shares for any consideration and for any
period.
Preference shares
2.3 The Company may not issue any preference shares nor may any
issued shares be converted into preference shares unless the
rights of the holders of the preference shares with respect to
repayment of capital, participation in surplus assets and
profits, cumulative or non-cumulative dividends, voting and
priority of payment of capital and dividends in relation to other
shares or other classes of preference shares are set out in the
Articles. Subject to the Corporations Law, preference shares may,
with the sanction of a resolution of the Company in general
meeting, be issued on the terms that they are, or at the option
of the Company are, liable to be redeemed.
Variation of rights
2.4 If at any time the share capital is divided into different
classes of shares, the rights attached to any class may (unless
otherwise provided by the terms of issue of the shares of that
class), whether or not the Company is being wound up, be varied
or abrogated in any way with the consent in writing of the
holders of three-quarters of the issued shares of that class, or
with the sanction of a special resolution passed at a separate
meeting of the holders of the shares of that class.
4
<PAGE>
2.5 The provisions of these Articles relating to general meetings
apply so far as they are capable of application and with the
necessary changes to every separate meeting of the holders of a
class of shares except that:
(a) a quorum is constituted by two persons who, between them,
hold or represent one-third of the issued shares of the
class; and
(b) any holder of shares of the class, present in person or by
proxy, attorney or representative appointed under Article
11.2 may demand a poll.
2.6 The rights conferred on the holders of the shares of any class
are not deemed to be varied by the creation or issue of further
shares ranking equally with the first-mentioned shares unless
otherwise:
(a) expressly provided by the terms of issue of the first-
mentioned shares; or
(b) required by the Corporations Law.
Commission and brokerage
2.7 The Company may exercise the power to pay brokerage or commission
conferred by the Corporations Law. The rate or the amount of the
manner required by the Corporations Law.
2.8 The total brokerage and commission must not exceed 10% of the
total amount payable on allotment of the shares in respect of
which the commission is paid.
2.9 The brokerage or commission may be satisfied by the payment of
cash or by the allotment of fully or partly paid shares or other
securities or partly by the payment of cash and partly by the
allotment of fully or partly paid shares or other securities.
5
<PAGE>
Recognition and disclosure of interests
2.10 Except as required by law, the Company is not bound or compelled
in any way to recognize a person as holding a share on any trust.
2.11 The Company is not bound by or compelled in any way to recognize
(whether or not it has notice of the interest or rights
concerned) any equitable, contingent, future or partial interest
in any share or unit of a share or (except as otherwise provided
by these Articles or by law) any other right in respect of a
share except an absolute right of ownership in the registered
holder.
Right to share and option certificate
2.12 A person whose name is entered as a Member in the Register or as
an optionholder in the register of options is entitled without
payment to receive a certificate in respect of the shares or
options registered in the person's name under the seal of the
Company in accordance with the Corporations Law but, in respect
of shares or options held jointly by several persons, the Company
is not bound to issue more than one certificate.
2.13 Delivery of a certificate for a share to one of several joint
holders is sufficient delivery to all such holders.
Joint holders of shares
2.14 Where two or more persons are registered as the joint holders of
shares they are deemed to hold the shares as joint tenants.
3 Lien
Lien on share
6
<PAGE>
3.1 The Company has a first and paramount lien on every share (other
than a fully paid share) for all money (whether presently payable
or not) called or payable at a fixed time in respect of that
share and such lien extends to all dividends, rights and other
distributions from time to time declared paid or made in respect
of that share.
3.2 The Company also has a first and paramount lien on all shares
(other than fully paid shares) registered in the name of a Member
for all money presently payable by that Member to the Company and
all money which the Company may be called on by law to pay in
respect of the shares of that Member.
3.3 Provisions of Articles 3.1 and 3.2.
Sale under lien
3.4 Subject to Article 3.5, the Company may sell, in such manner as
the Directors think fit, any share on which the Company has a
lien as if the share was forfeited.
3.5 A share on which the Company has a lien may not be sold by the
Company unless:
(a) a sum in respect of which the lien exists is presently
payable; and
(b) the Company has, not less than 14 days before the date of
sale, given to the registered holder for the time being of
the share or the person entitled to the share by reason of
the death or bankruptcy of the registered holder, a notice
in writing setting out, and demanding payment of, such part
of the amount in respect of which the lien exists as is
presently payable.
Transfer on sale under lien
7
<PAGE>
3.6 For the purpose of giving effect to a sale mentioned in Article
3.4, the Company may receive the consideration (if any) given for
the share so sold and may execute a transfer of the share sold in
favor of the person to whom the share is sold.
3.7 The Company must register the transferee as the holder of the
share comprised in any such transfer and the transferee is not
bound to see to the application of the purchase money.
3.8 The title of the transferee to the share is not affected by any
irregularity or invalidity in connection with the sale of the
share.
Proceeds of sale
3.9 The proceeds of a sale mentioned in Article 3.4 must be applied
by the Company in payment of such part of the amount in respect
of which the lien exists as is presently payable, and the residue
(if any) must (subject to any like lien for sums not presently
payable that existed on the share before the sale) be paid to the
person entitled to the share at the date of the sale.
4 Calls on shares
Directors to make calls
4.1 The Directors may make calls on a Member in respect of any money
unpaid on the shares of the Member (whether on account of the
nominal value of the shares or by way of premium) and not by the
terms of issue of those shares made payable at fixed times.
4.2 The directors may revoke or postpone a call.
Time of call
8
<PAGE>
4.3 A call is deemed to be made at the time when the resolution of
the Directors authorizing the call is passed.
Members' liability
4.4 On receiving at least 14 days' notice specifying the time or
times and place of payment, each Member must pay to the Company
at the time or times and place so specified the amount called on
the Member's shares.
4.5 The joint holders of a share are jointly and severally liable to
pay all calls in respect of the share.
4.6 The non-receipt of a notice of any call by, or the accidental
omission to give notice of a call to, a Member does not
invalidate the call.
Interest on default
4.7 If a sum called in respect of a share is not paid before or on
the day appointed for payment of the sum, the person from whom
the sum is due must pay interest on the sum to the time of actual
payment at the rate, not exceeding 20% per annum, determined by
the Directors, but the Directors may waive payment of that
interest wholly or in part.
Fixed installments deemed calls
4.8 Any sum that, by the terms of issue of a share, becomes payable
on allotment or at a fixed date, whether on account of the
nominal value of the share or by way of premium, is deemed for
the purposes of these Articles to be a call duly made and payable
on the date on which by the terms of issue the sum becomes
payable, and, in case of non-payment, all the relevant provisions
of these Articles as to payment of interest and expenses,
forfeiture or otherwise apply as if the sum had
9
<PAGE>
become payable by virtue of a call duly made and notified.
Differentiation between shareholders as to calls
4.9 The Directors may, on the issue of shares, differentiate between
the holders as to the amount of calls to be paid and the times of
payment.
Prepayment of calls
4.10 The Directors may accept from a Member the whole or a part of the
amount unpaid on a share although no part of that amount has been
called.
4.11 The Directors may authorize payment by the Company of interest on
the whole or any part of an amount so accepted, until the amount
becomes payable, at such rate, not exceeding the prescribed rate,
as is agreed on between the Directors and the Member paying the
sum.
4.12 For the purposes of Article 4.11, the prescribed rate of interest
is:
(a) if the Company has, by resolution, fixed a rate - the rate
so fixed; and
(b) in any other case - 20% per annum.
5 Transfer of shares
Forms of instrument of transfer
5.1 Subject to these Articles, a Member may transfer all or any of
the Member's shares by instrument in writing in any usual or
common form or in any form that the Directors approve.
10
<PAGE>
Registration procedure
5.3 The instrument of transfer must be left for registration at the
Registered Office accompanied by the certificate for the shares
to which it relates and such information as the Directors
properly require to show the right of the transferor to make the
transfer, and in that event, the Company must, subject to the
powers vested in the Directors by these Articles, register the
transferee as a shareholder.
5.4 A transferor of shares remains the holder of the shares
transferred until the transfer is registered and the name of the
transferee is entered in the Register in respect of the shares
and a transfer of shares does not pass the right to any dividends
declared on the shares until such registration.
Directors may decline to register
5.5 The Directors may decline to register any transfer of shares,
without being bound to give any reason whatsoever for so doing.
6 Transmission of shares
Transmission of shares on death of holder
6.1 In the case of the death of a Member, the survivor or survivors
where the deceased was a joint holder, and the legal personal
representatives of the deceased where the deceased was a sole
holder, are the only persons recognized by the Company as having
any title to the deceased's interest in the shares, but this
Article does not release the estate of a deceased joint holder
from any liability in respect of a share that had been jointly
held by the deceased with other persons.
11
<PAGE>
Right to registration on death or bankruptcy
6.2 Subject to the Bankruptcy Act 1966, a person becoming entitled to
a share in consequence of the death or bankruptcy of a Member
may, on such information being produced as is properly required
by the Directors, either elect to be registered as holder of the
share or nominate another person to be registered as the
transferee of the share. Where the surviving joint holder becomes
entitled to a share in consequence of the death of a Member the
Directors must, on satisfactory evidence of that death being
produced to them, direct the Register to be altered accordingly.
6.3 If the person becoming entitled elects to be registered as holder
of the share under Article 6.2 the person must deliver or send to
the Company a notice in writing signed by the person in such form
as the Directors approve stating that the person so elects.
6.4 If the person becoming entitled nominates another person to be
registered as the transferee of the share under Article 6.2 the
person must execute a transfer of the share to the other person.
6.5 All the limitations, restrictions and provisions of these
Articles relating to the right to transfer, and the registration
of transfer of, shares are applicable to any such notice or
transfer as if the death or bankruptcy of the Member had not
occurred and the notice or transfer were a transfer signed by
that Member.
Effect of transmission
6.6 If the registered holder of a share dies or becomes bankrupt, the
personal representative or the trustee of the estate of the
registered holder, as the case may be, is, on the production of
such information as is properly required by the Directors,
entitled to the same dividends and other advantages, and to the
same rights (whether
12
<PAGE>
in relation to meetings of the Company, or to voting or
otherwise), as the registered holder would have been entitled to
if the registered holder had not died or become bankrupt.
6.7 If two or more persons are jointly entitled to any share in
consequence of the death of the registered holder, they are, for
the purpose of these Articles, deemed to be joint holders of the
share.
7 Forfeiture of shares
Notice requiring payment of call
7.1 If a Member fails to pay a call or installment of a call on the
day appointed for payment of the call or installment, the
Directors may, at any time thereafter during such time as any
part of the call or installment remains unpaid, serve a notice on
the Member requiring payment of so much of the call or
installment as is unpaid, together with any interest that has
accrued and all costs and expenses that may have been incurred by
the Company by reason of such non-payment.
7.2 The notice must name a further day (not earlier than the
expiration of 14 days from the date of service of the notice) on
or before which the payment required by the notice is to be made
and must state that, in the event of non-payment at or before the
time appointed, the shares in respect of which the call was made
will be liable to be forfeited.
Forfeiture for failure to comply with notice
7.3 If the requirements of a notice served under Article 7.1 are not
complied with, any share in respect of which the notice has been
given may at any time thereafter, before the payment required by
the notice has been made, be forfeited by a resolution of the
Directors to that effect.
13
<PAGE>
7.4 Such a forfeiture includes all dividends declared in respect of
the forfeited shares and not actually paid before the forfeiture.
7.5 Any share forfeited under Article 7.3 may be sold, re-allotted or
otherwise disposed of to whom and on such terms and conditions,
subject to the Corporations Law, as the Directors think fit.
7.6 If any share is forfeited under Article 7.3 notice of the
forfeiture must be given to the Member holding the share
immediately prior to the forfeiture and an entry of forfeiture
with the date thereof must be made in the Register.
Cancellation of forfeiture
7.7 At any time before a sale or disposition of a share, the
forfeiture of that share may be cancelled on such terms as the
Directors think fit.
Effect of forfeiture on former holder's liability
7.8 A person whose shares have been forfeited ceases to be a Member
in respect of the forfeited shares, but remains liable to pay the
Company all money that, at the date of forfeiture, was payable by
that person to the Company in respect of the shares (including
interest at the rate, not exceeding 20% per annum, determined by
the Directors from the date of forfeiture on the money for the
time being unpaid if the Directors think fit to enforce payment
of the interest and also expenses owing), but that person's
liability ceases if and when the Company receives payment in full
of all money (including interest and expenses) so payable in
respect of the shares.
Evidence of forfeiture
14
<PAGE>
7.9 A statement in writing declaring that the person making the
statement is a director or a secretary of the Company, and that a
share in the Company has been duly forfeited in accordance with
the Articles on the date stated in the statement, is prima facie
evidence of the facts stated in the statement as against all
persons claiming to be entitled to the share.
Transfer of forfeited share
7.10 The Company may receive the consideration (if any) given for
a forfeited share on any sale or disposition of the share and may
execute a transfer of the share in favor of the person to whom
the share is sold or disposed of.
7.11 On the execution of the transfer, the transferee must be
registered as the holder of the share and is not bound to see to
the application of any money paid as consideration.
7.12 The title of the transferee to the share is not affected by any
irregularity or invalidity in connection with the forfeiture,
sale or disposal of the share.
8 Conversion of shares into stock
Company may convert shares into stock
8.1 The Company may, by resolution in general meeting, convert all or
any of its paid up shares into stock and re-convert any stock
into paid up shares of any nominal value.
Transfer of stock
8.2 Subject to Article 8.3, when shares have been converted into
stock, the provisions of these Articles relating to the transfer
of shares apply, so far as they are capable of application,
15
<PAGE>
to the transfer of the stock or of any part of the stock.
8.3 The Directors may fix the minimum amount of stock transferable
and restrict or forbid the transfer of fractions of that minimum,
but the minimum must not exceed the aggregate of the nominal
values of the shares from which the stock arose.
Stockholders' rights
8.4 The holders of stock have, according to the amount of the stock
held by them, the same rights, privileges and advantages as
regards dividends, have if they held the shares from which the
stock arose.
8.5 No privilege or advantage (except participation in the dividends
and profits of the Company and in the property of the Company on
winding up) is conferred by any amount of stock that would not,
if existing in shares, have conferred that privilege or
advantage.
Application of Articles to stock
8.6 The provisions of these Articles that are applicable to paid up
shares apply to stock, and references in those provisions to
share and Member include references to stock and stockholder
respectively.
9 Alteration of capital
Company's power to alter capital
9.1 The Company in general meeting may by resolution:
(a) increase its authorized share capital by the creation of new
shares of such amount as is specified in the resolution;
16
<PAGE>
(b) consolidate and divide all or any of its authorized share
capital into shares of a larger amount than its existing
shares;
(c) subdivide all or any of its shares into shares of a smaller
amount than its existing shares but so that in the
subdivision the proportion between the amount paid and the
amount (if any) unpaid on each such share of a smaller
amount is the same as it was in the case of the share from
which the share of a smaller amount is derived; and
(d) cancel shares that, at the date of the passing of the
resolution, have not been taken or agreed to be taken by any
person or have been forfeited and reduce its authorized
share capital by the amount of the shares so cancelled.
Reduction of capital
9.2 Subject to the Corporations Law, the Company in general meeting
may, by special resolution, reduce its share capital, any capital
redemption reserve fund or any share premium account.
10 General meetings
Annual general meeting
10.1 Annual general meetings of the Company are to be held in
accordance with the Corporations Law.
General meeting
10.2 The Directors may convene a general meeting of the Company
whenever they think fit.
Notice of general meeting
17
<PAGE>
10.3 Subject to the provisions of the Corporations Law relating to
special resolutions and agreements for shorter notice, at least
14 days' notice (served and of the day for which notice is given)
specifying the place, day and the hour of the meeting and, in the
case of special business, the general nature of that business,
must be given to such persons as are entitled to receive notices
from the Company.
The non-receipt of notice of a general meeting by, or the
accidental omission to give notice of a general meeting to, a
person entitled to receive notice does not invalidate any
resolution passed at the general meeting.
Special business of general meeting
10.4 All business that is transacted at a general meeting is special
with the exception at an annual general meeting of the
declaration of a dividend, the consideration of the accounts and
the reports of the Directors and the Auditor, the appointment of
the Auditor and the election of Directors.
Requisitioned meeting
10.5 The Directors must, on the written requisition of:
(a) not less than 100 Members holding shares in the Company on
which there has been paid up an average sum, per Member, of
not less than $200; or
(b) a Member who is entitled or Members who are together
entitled, to not less than 5% of the total voting rights of
all Members having at the date of the deposit of the
requisition a right to vote at general meetings;
18
<PAGE>
immediately convene a general meeting of the Company to be held
as soon as practicable but, in any case, not later than two
months after the deposit of the requisition.
Objects of requisitioned meeting
10.6 The requisition for a general meeting must state the objects of
the meeting and must be signed by the requisitionists and
deposited at the Registered Office, and may consist of several
documents in like form each signed by one or more of the
requisitionists.
Convening requisitioned meeting
10.7 If the Directors do not, within 21 days after the deposit of the
requisition, proceed to convene a general meeting the
requisitionists or any of them representing more that one-half of
the total voting rights of all of them may themselves, in the
same manner as nearly as possible as that in which meetings are
to be convened by the Directors, convene a meeting, but a meeting
so convened may not be held after the expiration of three months
from the date of the deposit of the requisition.
Expenses of requisitioned meeting
10.8 Any reasonable expenses incurred by the requisitionists
by reason of the failure of the Directors to convene a general
meeting must be paid to the requisitionists by the Company and
any sum so paid must be retained by the Company out of any sums
due or to become due from the Company by way of fees or other
remuneration in respect of their services to such of the
Directors as were in default.
Postponement or cancellation of meeting
19
<PAGE>
10.9 The Directors may postpone as they think fit (other than a
meeting convened as a result of a requisition under Article 10.5
or by requisitionists under Article 10.7).
11 Proceedings at general meetings
Representation of Member
11.1 Any Member may be represented at any meeting of the Company by a
proxy or attorney.
11.2 If a body corporate is a Member it may also, by resolution of its
directors or other governing body, authorize such person as it
thinks fit to act as its representative either at a particular
general meeting or at all general meetings of the Company or of
any class of Members.
11.3 A person authorized under Article 11.2 is, in accordance with
that authority and until it is revoked by the body corporate,
entitled to exercise the same powers on behalf of the body
corporate as the body corporate could exercise if it were a
natural person who was a Member.
11.4 Unless the contrary intention appears, a reference to a Member in
the succeeding provisions of this Part 11 means a Member, a
proxy or attorney of a Member or a person appointed under
Article 11.2 to represent a body corporate which is a Member.
Quorum
11.5 No business may be transacted at any general meeting unless a
quorum is present comprising two Members present in person or by
proxy, attorney or representative appointed under Article 11.2
and entitled to vote at the meeting. If a quorum is present at
the beginning of a meeting it is deemed present throughout the
meeting unless the
20
<PAGE>
chairman of the meeting otherwise declares, on the chairman's own
motion or at the instance of a Member, proxy, attorney or
representative appointed under Article 11.2.
Failure to achieve quorum
11.6 If a meeting is convened on the requisition of Members and a
quorum is not present within half an hour from the time appointed
for the meeting, the meeting must be dissolved.
11.7 If a meeting is convened in any other case and a quorum is not
present within half an hour from the time appointed for the
meeting:
(a) the meeting must be adjourned to such day, time and place as
the Directors determine or if no determination is made by
them to the same day in the next week at the same time and
place; and
(b) if at the adjourned meeting a quorum is not present within
half an hour from the time appointed for the meeting the
meeting must be dissolved.
Appointment and powers of chairman of general meeting
11.8 Meetings that person must preside as chairman at every general
meeting.
11.9 If a general meeting is held and:
(a) a chairman has not been elected as provided by Article 11.8;
or
(b) the chairman is not present within 15 minutes after the time
appointed for the holding for the meeting or is unable or
unwilling to act,
then the deputy chairman elected under Article 14.16 (if any)
must act as chairman of the
21
<PAGE>
meeting. If there is no such person or that person is absent or
unable or unwilling to act, the Directors present must elect one
of their number to be chairman of the meeting, or, if no Director
is present or if all Directors present decline to take the chair,
the Members present must elect one of their number to be chairman
of the meeting.
Adjournment of general meeting
11.10 The chairman may, with the consent of any meeting at which a
quorum is present, and must if so directed by the meeting,
adjourn the meeting from day to day, time to time and from place
to place, but no business may be transacted at any adjourned
meeting other than the business left unfinished at the meeting
from which the adjournment took place.
11.11 When a meeting is adjourned for 30 days or more, notice of the
adjourned meeting must be given as in the case of an original
meeting.
11.12 Except as provided by Article 11.11, it is not necessary to give
any notice of an adjournment or of the business to be transacted
at any adjourned meeting.
Voting at general meeting
11.13 At any general meeting a resolution put to the vote of the
meeting must be decided on a show of hands unless a poll is
(before or on the declaration of the result of the show of hands)
demanded:
(a) by the chairman;
(b) by not less than five Members having the right to vote at
the meeting;
22
<PAGE>
(c) by a Member or Members present who are together entitled to
not less than 10% of the total voting rights of all the
Members having the right to vote at the meeting; or
(d) by a Member or Members present and holding shares in the
Company conferring a right to vote at the meeting, being
shares on which an aggregate sum has been paid up equal to
not less than 10% of the total sum paid up on all the shares
conferring that right.
Unless a poll is properly demanded, a declaration by the chairman
that a resolution has on a show of hands been carried or carried
unanimously, or by a particular majority, or lost, and an entry
to that effect in the book containing the minutes of the
proceedings of the Company, is conclusive evidence of the fact
without proof of the number or proportion of the votes recorded
in favor of or against the resolution.
Questions decided by majority
11.14 Subject to the requirements of the Corporations Law in relation
to special resolutions, a resolution is taken to be carried if
the proportion that the number of votes in favor of the
resolution bears to the total number of votes on the resolution
exceeds one half.
Poll
11.15 If a poll is properly demanded, it must be taken in such manner
and (subject to Article 11.16) either at once or after an
interval or adjournment or otherwise as the chairman directs, and
the result of the poll is the resolution of the meeting at which
the poll was demanded.
11.16 A poll demanded on the election of a chairman or on a question of
adjournment must be taken immediately.
23
<PAGE>
11.17 The demand for a poll may be withdrawn.
Equality of votes
11.18 If there is an equality of votes, whether on a show of hands or
on a poll, the chairman of the meeting is not entitled to a
casting vote in addition to any votes to which the chairman is
entitled as a Member or proxy or attorney or representative of a
Member.
Entitlement to vote
11.19 Subject to any rights or restrictions for the time being
attached to any class or classes of shares and to these Articles:
(a) on a show of hands every person present who is a Member or a
proxy, attorney or representative of a Member has one vote;
and
(b) on a poll every person present who is a Member or proxy,
attorney or representative of a Member has one vote for each
share that the person holds or represents (as the case may
be).
Joint shareholders' vote
11.20 In the case of joint holders of a share in the Company the vote
of the senior who tenders a vote, whether in person or by proxy,
attorney or representative, must be accepted to the exclusion of
the votes of the other joint holders and, for this purpose,
seniority is determined by the order in which the names stand in
the Register.
Vote of shareholder of unsound mind
11.21 If a Member is of unsound mind or is a person whose person or
estate is liable to be dealt with
24
<PAGE>
in any way under the law relating to mental health then the
Member's committee or trustee or such other person as properly
has the management of the Member's estate may exercise any rights
of the Member in relation to a general meeting as if the
committee, trustee on other person were the Member.
Effect of unpaid call
11.22 A Member is not entitled to vote at a general meeting unless all
calls and other sums presently payable by the Member in respect
of shares in the Company have been paid.
Objection to voting qualification
11.23 An objection may be raised to the qualification of a voter only
at the meeting or adjourned meeting at which the vote objected to
is given or tendered.
11.24 Any such objection must be referred to the chairman of the
meeting, whose decision is final.
11.25 A vote not disallowed under such an objection is valid for all
purposes.
Appointment of proxy
11.26 An instrument appointing a proxy must be in writing under the
hand of the appointor or of the appointor's attorney duly
authorized in writing or, if the appointor is a corporation,
either under seal or under the hand of an officer or attorney
duly authorized. A proxy need not be a Member.
11.27 An instrument appointing a proxy may specify the manner in which
the proxy is to vote in respect of a particular resolution and,
if an instrument of proxy so provides, the proxy is not entitled
25
<PAGE>
to vote on the resolution except as specified in the instrument.
11.28 An instrument appointing a proxy is deemed to confer authority
to demand or join in demanding a poll.
11.29 An instrument appointing a proxy must be in the form approved by
the Directors from time to time.
Deposit of proxy and other instruments
11.30 An instrument appointing a proxy may not be treated as valid
unless the instrument, and the power of attorney or other
authority (if any) under which the instrument is signed or a copy
of that power or authority certified as a true copy by statutory
declaration is or are received by the Company not less than 48
hours before the time for holding the meeting or adjourned
meeting at which the person named in the instrument proposes to
vote at the Registered Office or at such other place as is
specified for that purpose in the notice convening the meeting.
Validity of vote in certain circumstances
11.31 A vote given in accordance with the terms of an instrument of
proxy or of a power of attorney is valid notwithstanding the
previous death or unsoundness of mind of the principal, the
revocation of the instrument (or of the authority under which the
instrument was executed) or of the power, or the transfer of the
share in respect of which the instrument or power is given, if no
intimation in writing of the death, unsoundness of mind,
revocation or transfer has been received by the Company at its
Registered Office before the commencement of the meeting or
adjourned meeting at which the instrument is used or the power is
exercised.
26
<PAGE>
Director entitled to notice of meeting
11.32 A Director is entitled to receive notice of and to attend all
general meetings and all separate general meetings of the holders
of any class of shares in the Company and is entitled to speak at
those meetings.
Resolution in writing
11.33 Subject to the provisions of the Corporations Law, a resolution
in writing signed by all the Members is as valid and effectual as
if it had been passed at a general meeting of the Company duly
convened and held at the time at which the written resolution was
last signed by a Member. Any such resolution may consist of
several documents in like form, each signed by one or more
Members.
12 The Directors
Number of Directors
12.1 The number of Directors must not be less than one. The names of
the first Directors will be determined in writing by the
subscriber to the memorandum of association of the Company and
those Directors will continue in office subject to these
Articles. The Company in general meeting may, by resolution,
increase or reduce the number of Directors.
Share qualification of Directors
12.2 A Director is not required to hold any share in the Company.
Appointment of Director
12.3 The Company in general meeting may by resolution and the
Directors may at any time appoint any
27
<PAGE>
person to be a Director, either to fill a casual vacancy or as an
addition to the existing Directors, but so that the total number
of Directors does not at any time exceed the number determined in
accordance with Article 12.1
Removal of Director
12.4 The Company in general meeting may by resolution remove any
Director from office and may by resolution appoint another person
in that Director's stead.
Remuneration of Directors
12.5 The Directors may be paid such remuneration as is determined from
time to time by the Company in general meeting. That
remuneration is deemed to accrue from day to day. A Director who
retires, and is not reappointed in accordance with these
Articles, may be paid a retirement benefit in recognition of past
services in the amount determined by the Directors, but not
exceeding the amount permitted by the Corporations Law.
12.6 The Directors may also be paid all travelling and other expenses
properly incurred by them in attending, participating in and
returning from meetings of the Directors or any committee of the
Directors or general meetings of the Company or otherwise in
connection with the business of the Company.
Director's interests
12.7 No Director is disqualified by the Director's office and the
fiduciary relationship established by it from holding any office
or place of profit (subject to the Corporations Law):
(a) be or become a director of or otherwise hold office or a
place of profit in any other
28
<PAGE>
company promoted by the Company or in which the Company may
be interested as vendor, shareholder or otherwise;
(b) contract or make any arrangement with the Company whether as
vendor, purchaser, broker, solicitor or accountant or other
professional person or otherwise and any contract or
arrangement entered or to be entered into by or on behalf of
the Company in which any Director is in any way interested
is not avoided for that reason; and
(c) participate in any association, institution, fund, trust or
scheme for past or present employees or Directors of the
Company, a related body corporate or any of their respective
predecessors in business or their dependants or persons
connected with them.
12.8 Any Director who:
(a) holds any office or place of profit under the Company;
(b) holds any office or place of profit referred to in Article
12.7(a);
(c) is involved in a contract or arrangement referred to in
Article 12.7(b); or
(d) participates in an association or otherwise under Article
12.7(c);
is not by reason only of any of those facts or any interest
resulting from it or the fiduciary relationship established by it
liable to account to the Company for any remuneration or other
benefits accruing from it.
12.9 Each Director must disclose that Director's interests to the
Company in accordance with the Corporations Law and the Secretary
must record
29
<PAGE>
any such declaration in the minutes of the relevant meeting.
12.10 A Director may only vote in respect of any contract or proposed
contract or arrangement in which the Director has a material
interest if the Director has first disclosed the interest to the
Directors in accordance with the Corporations Law and if the
Director is not permitted to vote under this Article but does so
vote then that vote may not be counted. Directors may vote in
respect of a contract for insurance of the company or its
officers against a liability incurred by officers as officers of
the Company or a related body corporate.
12.11 The restrictions contained in Article 12.10 may at any time or
times be suspended or relaxed to any extent and either
prospectively or retrospectively by resolution of the Company in
general meeting.
12.12 A Director or a Director's firm may act in a professional
capacity (other than as Auditor) for the Company and a Director
or a Director's firm is entitled to remuneration for professional
services as if the relevant Director was not a Director.
12.13 Execution of any instrument by or on behalf of the Company and
whether through signing or sealing the same or otherwise.
Vacation of office of Director
12.14 In addition to the circumstances in which the office of a
Director becomes vacant under the Corporations Law, the office of
a Director becomes vacant if the Director:
(a) becomes of unsound mind or a person whose person or estate
is liable to be dealt with in any way under the law relating
to mental health;
30
<PAGE>
(b) resigns from the office by notice in writing to the Company;
or
(c) is absent without the consent of the remaining Directors
from meetings of the Directors held during a period of six
months.
13 Powers and duties of Directors
Directors to manage Company
13.1 Subject to the Corporations Law and to any other provision of
these Articles the business of the Company is managed by the
Directors, who may exercise all such powers of the Company as are
not, by the Corporations Law or by these Articles, required to be
exercised by the Company in general meeting.
13.2 Without limiting the generality of Article 13.1, the Directors
may exercise all the powers of the Company to borrow or raise
money, to charge any property or business of the Company or all
or any of its uncalled capital and to issue debentures or give
any other security for a debt, liability or obligation of the
Company or of any other person.
Appointment of attorney
13.3 The Directors may, by power of attorney, appoint any person or
persons to be the attorney or attorneys of the Company for such
purposes, with such powers, authorities and discretions (being
powers, authorities and discretions vested in or exercisable by
the Directors), and for such period and subject to such
conditions as they think fit.
13.4 Any such power of attorney may contain such provisions for the
protection and convenience or persons dealing with the attorney
as the Directors think fit and may also authorize the
31
<PAGE>
attorney to delegate all or any of the powers, authorities and
discretions vested in the attorney.
Minutes
13.5 The Directors must cause minutes to be made:
(a) of the names of the Directors present at or involved in all
general meetings and all meetings of the Directors; and
(b) of all proceedings of general meetings and of meetings of
Directors,
(c) relevant meeting is held, in the minute book.
13.6 The minutes referred to in Article 13.5 must be signed by the
chairman of the meeting at which the proceedings took place or by
the chairman of the next succeeding meeting.
Execution of Company cheques etc
13.7 All cheques, promissory notes, bankers' drafts, bills of exchange
and other negotiable instruments, and all receipts for money paid
to the Company, must be signed, drawn, accepted, endorsed or
otherwise executed, as the case may be, in such manner and be
such persons as the Directors determine from time to time.
14 Proceedings of Directors
Directors' meetings
14.1 The Directors may meet together for the dispatch of business and
adjourn and otherwise regulate their meetings as they think fit.
14.2 A Director may at any time, and the Secretary must on the
requisition of a Director, convene a meeting of the Directors.
32
<PAGE>
Questions decided by majority
14.3 Subject to these Articles, questions arising at a meeting of
Directors are to be decided by a majority of votes of Directors
involved and voting and any such decision is for all purposes
deemed a decision of the Directors.
14.4 An Alternate Director involved in any meeting of Directors has
one vote for each Director for which that person is an Alternate
Director and if that person is a Director also has one vote as a
Director.
14.5 In the event of an equality of votes the chairman of the meeting
does not have a casting vote.
Alternate Directors
14.6 A Director may appoint a person (whether a Member of the Company
or not) to be an Alternate Director in the Director's place
during such period as the Director thinks fit.
14.7 An Alternate Director is entitled to notice of all meetings of
the Directors and, if the appointor is not involved in such a
meeting, is entitled to participate and vote in the appointor's
stead.
14.8 An Alternate Director may exercise any powers
that the appointor may exercise and in the exercise of any such
power the Alternate Director is an officer of the Company and is
not deemed an agent of the appointor.
14.9 An Alternate Director is not required to hold any share in the
Company.
14.10 An Alternate Director is subject in all respects to the
conditions attaching to the Directors generally except that an
Alternate Director is the Alternate Director's appointor.
33
<PAGE>
14.11 The appointment of an Alternate Director may be terminated at
any time by the appointor notwithstanding that the period of the
appointment of the Alternate Director has not expired, and
terminates in any event if the appointor vacates office as a
Director.
14.12 An appointment, or the termination of an appointment, of an
Alternate Director must be effected by a notice in writing
signed by the Director who makes or made the appointment and
served on the Company.
14.13 The notice of appointment or termination of appointment of an
Alternate Director may be served on the Company by leaving it at
the Registered Office or by forwarding it by facsimile
transmission to the Registered Office and in the case of a
facsimile transmission, the appearance at the end of the message
of the name of the Director appointing or terminating the
appointment is sufficient evidence that the Director has signed
the notice.
Quorum for Directors' meetings
14.14 At a meeting of Directors, the number of Directors whose
involvement is necessary to constitute a quorum is two, unless
the Company has only one director, or such greater number as is
determined by the Directors from time to time. Notwithstanding
Article 12.10, a Director who has a material interest in any
contract or proposed contract or arrangement may be counted in
the quorum involved in any Directors' meeting at which such
contract, proposed contract or arrangement is considered.
Remaining Directors may act
34
<PAGE>
14.15 In the event of a vacancy or vacancies in the office of a
Director or offices of Directors, the remaining Director or
Directors may act but, if the number of remaining Directors is
not sufficient to constitute a quorum at a meeting Directors,
they may act only for the purpose of:
(a) increasing the number of Directors to a number sufficient to
constitute such a quorum; or
(b) convening a general meeting of the Company.
Chairman of Directors
14.16 The Directors must elect one of their number as chairman of
their meetings and may determine the period for which the person
elected as chairman is to hold office. The Directors may also
elect one of their number as deputy-chairman of their meetings
and may determine the period for which the person elected as
deputy-chairman is to hold office.
14.17 When a Directors' meeting is held and:
(a) a chairman has not been elected as provided by Article
14.16; or
(b) the chairman is not present within ten minutes after the
time appointed for the holding of the meeting or is unable
or unwilling to act,
(c) there is no such person or that person is absent or unable
or unwilling to act, the Directors involved must elect one
of their number to be a chairman of the meeting.
Directors' committees
14.18 The Directors may delegate any of their powers, other than
powers required by law to be dealt
35
<PAGE>
with by the directors as a board, to a committee or committees
consisting of at least one of their number and such other persons
as they think fit.
14.19 A committee to which any powers have been so delegated must
exercise the powers delegated in accordance with any directions
of the Directors and a power so exercised is deemed to have been
exercised by the Directors.
14.20 The members of such a committee may elect one of their number as
chairman of their meetings.
14.21 If such a meeting is held and:
(a) a chairman has not been elected as provided by Article
14.20; or
(b) the chairman is not present within ten minutes after the
time appointed for the holding of the meeting or is unable
or unwilling to act,
the members involved may elect one of their number to be chairman
of the meeting.
14.22 A committee may meet and adjourn as it thinks proper.
14.23 Questions arising at a meeting of a committee are to be
determined by a majority of votes of the members involved and
voting.
14.24 In the event of there being an equality of votes, the chairman,
in addition to the chairman's deliberative vote, has a casting
vote.
Written resolution by Directors
14.25 A resolution in writing signed by all the Directors who are
eligible to vote on the resolution is as valid and effectual as
if it had been passed at a meeting of the Directors held at the
time when the written resolution was last
36
<PAGE>
signed by an eligible Director. Any such resolution may consist
of several documents in like form, each signed by one or more
Directors.
Directors' meetings defined
14.26 The Directors may conduct meetings without Directors being in the
physical presence of other Directors provided that all the
Directors involved in the meeting are able simultaneously to hear
each other and to participate in discussion.
14.27 Article 14.26 applies to meetings of Directors' committees as if
all members were Directors.
Validity of acts of Directors
14.28 All acts done by any meeting of the Directors or of a committee
of Directors or by any person acting as a Director are,
notwithstanding that it is afterwards discovered that there was
some defect in the appointment of a person to be a Director or a
member of the committee, or to act as a Director, or that a
person so appointed was disqualified, as valid as if the person
had been duly appointed and was qualified to be a Director or to
be a member of the committee.
Appointment of Managing and Executive Directors
14.29 The Directors may from time to time appoint one or more of their
number to the office of Managing Director or Executive Director
for such period and on such terms as they think fit, and, subject
to the terms of any agreement entered into in a particular case,
may revoke any such appointment.
Remuneration of Managing and Executive Directors
14.30 A Managing Director or Executive Director may, subject to the
terms of any agreement entered
37
<PAGE>
into in a particular case, receive such remuneration (whether by
way of salary, commission or participation in profits, or partly
in one way and partly in another) as the Directors determine.
Powers of Managing and Executive Directors
14.31 The Directors may, on such terms and conditions and with such
restrictions as they think fit, confer on a Managing Director or
an Executive Director any of the powers exercisable by them.
14.32 Any powers so conferred may be concurrent with, or be to the
exclusion of, the powers of the Directors.
14.33 The Directors may at any time withdraw or vary any of the powers
so conferred on a Managing Director or an Executive Director.
15 Secretary
Appointment of Secretary
15.1 There must be at least one Secretary of the Company who may be
appointed by the Directors for such term, at such remuneration
and on such conditions as they think fit.
Suspension and removal of Secretary
15.2 The Directors have power to suspend or remove a Secretary.
Powers and duties of Secretary
15.3 The Directors may vest in a Secretary such powers, duties and
authorities as they may from time to time determine and a
Secretary must exercise all such powers and authorities subject
at all times to the control of the Directors.
38
<PAGE>
Secretary to attend meetings
15.4 A Secretary is entitled to participate in all meetings of the Directors
and all general meetings of the Company and may be heard on any
matter.
16 Common seal and official seal
Custody of common seal
16.1 The Directors must provide for the safe custody of the common
seal.
Use of common seal
6.2 The common seal may be used only by the authority of the
Directors, or of a committee of the Directors authorized by the
Directors to authorize the use of the common seal, and every
document to which the common seal is affixed must be signed by a
Director and be countersigned by another Director, a Secretary or
another person appointed by the Directors to countersign that
document or a class of documents in which that document is
included.
16.2A The sole director, if only one person is appointed to the office
of director and that person is also the sole secretary of the
Company, may be the sole signatory to documents to which the
common seal is affixed.
Use of official seals
16.3 The Company may have for use outside the State in place of the
common seal one or more official seals, each of which must be a
facsimile of the common seal with the addition on its face of the
name of every place where it is to be used.
16.4 The Company may by writing under its common seal empower a person
in a place either generally or
39
<PAGE>
in respect of a specified matter to affix its official seal for
that place to any instrument to which the Company is a party.
17 Inspection of records
Inspection by Members
17.1 Except as otherwise required by the Corporations Law, the
Directors may determine whether and to what extent, and at what
times and places and under what conditions, the accounting
records and other documents of the Company or any of them will be
open to the inspection of Members other than Directors, and a
Member other than a Director does not have the right to inspect
any document of the Company except as provided by law or
authorized by the Directors or by the Company in general meeting.
18 Dividends and reserves
Declaration of final dividend
18.1 Subject to the rights of persons (if any) entitled to shares with
special rights to dividend, the Directors may declare a final
dividend out of profits in accordance with the Corporations Law
and may authorize the payment or crediting by the Company to the
Members of such a dividend.
Directors may authorize interim dividend
18.2 The Directors may authorize the payment or crediting by the
Company to the Members of such interim dividends as appear to the
Directors to be justified by the profits of the Company.
No interest on dividends
40
<PAGE>
18.3 Interest may not be paid by the Company in respect of any
dividend, whether final or interim.
Reserves and profits carried forward
18.4 The Directors may, before declaring any dividend, set aside out
of the profits of the Company such sums as they think proper as
reserves, to be applied, at the discretion of the Directors, for
any purpose for which the profits of the Company may be properly
applied.
18.5 Pending any such application, the reserves may, at the discretion
of the Directors, by used in the business of the Company or be
invested in such investments as the Directors think fit.
18.6 The Directors may carry forward so much of the profits remaining
as they consider ought not to be distributed as dividends without
transferring those profits to a reserve.
Calculation and apportionment of dividends
18.7 Subject to the rights of persons (if any) entitled to shares with
special rights to dividend and to the terms of any issue of
shares to the contrary all dividends are to be declared and paid
according to the amounts paid or credited as paid on the shares
in respect of which the dividend is paid, and are to be
apportioned and paid proportionately to the amounts paid or
credited as paid on the shares during any portion or portions of
the period in respect of which the dividend is paid.
18.8 An amount paid or credited as paid on a share in advance of a
call is not to be taken as paid or credited as paid on the share
for the purposes of Article 18.7.
41
<PAGE>
Deductions from dividends
18.9 The Directors may deduct from any dividend payable to a Member
all sums of money (if any) presently payable by that Member to
the Company on account of calls or otherwise in relation to
shares in the Company.
Distribution of specific assets
18.10 The Directors, when paying or declaring a dividend, may direct
payment of a dividend wholly or partly by the distribution of
specific assets, including paid up shares in, or debentures of,
any other corporation.
18.11 If a difficulty arises in regard to such a distribution, the
Directors may settle the matter as they consider expedient and
fix the value for distribution of the specific assets or any part
of those assets and may determine that cash payments will be made
to any Members on the basis of the value so fixed in order to
adjust the rights of all parties, and may vest any such specific
assets in trustees as the Directors consider expedient. If a
distribution of specific assets to a particular Member or Members
is illegal or, in the Directors' opinion, impracticable then the
Directors may make a cash payment to that Member or Members on
the basis of the cash amount of the dividend instead of the
distribution of specific assets.
Payment by cheque and receipts from joint holders
18.12 Any dividend, interest or other money payable in cash in respect
of shares may be paid by cheque sent through the post directed:
(a) to the address of the holder as shown in the Register or, in
the case of joint holders, to the address shown in the
Register as the address of the joint holder first named in
the Register; or
42
<PAGE>
(b) to such other address as the holder or joint holders in
writing directs or direct.
18.13 Any one of two or more joint holders may give effectual receipts
for any dividends, interest or other money payable in respect of
the shares held by them as joint holders.
Unclaimed dividends
18.14 All dividends declared but unclaimed may be invested by the
Directors as they think fit for the benefit of the Company until
claimed or until required to be dealt with in accordance with any
law relating to unclaimed moneys.
19 Capitalization of profits
Capitalization of reserves and profits
19.1 The Directors may resolve that it is desirable to capitalize any
sum, being the whole or a part of the amount for the time being
standing to the credit of any reserve account or the profit and
loss account or otherwise available for distribution to Members,
and that the sum is applied, in any of the ways mentioned in
Article 19.2, for the benefit of Members in the proportions to
which those Members would have been entitled in a distribution of
that sum by way of dividend.
19.2 The ways in which a sum may be applied for the benefit of Members
under Article 19.1 are:
(a) in paying up any amounts unpaid on shares held by Members;
(b) in paying up in full unissued shares or debentures to be
issued to Members as fully paid; or
(c) partly as mentioned in paragraph (a) and partly as mentioned
in paragraph (b).
43
<PAGE>
19.3 The Directors may do all things necessary to give effect to the
resolution and, in particular, to the extent necessary to adjust
the rights of the Members among themselves, may:
(a) issue fractional certificates or make cash payments in cases
where shares or debentures become issuable in fractions; and
(b) authorize any person to make, on behalf of all or any of the Members
entitled to any further shares of debentures on the capitalization, an
agreement with the Company providing for the issue to them, credited as
fully paid up, of any such further shares or debentures or for the
payment up by the Company on respective proportions of the sum resolved
to be capitalized, and any such agreement is effective and binding on
all the Members concerned.
20 Notices
Service of notices
20.1 A notice may be given by the Company to any Member or other
person receiving notice under these Articles either by serving it
on the person personally or by sending it by post or facsimile
transmission to the person at their address as shown in the
Register or the address supplied by the person to the Company for
the giving of notices to the person.
20.2 If a notice is sent by post, service of the notice is deemed to
be effected by properly addressing, prepaying, and posting a
letter containing the notice, and the notice is deemed to have
been served on the day after the date of its posting.
20.3 If a notice is sent by facsimile transmission, service of the
notice is deemed to be effected by
44
<PAGE>
properly addressing the facsimile transmission and transmitting
same and to have been served on the day following its dispatch.
20.4 A notice may be given by the Company to the joint holders of a
share by giving the notice to the joint holder first named in the
Register in respect of the share.
20.5 Every person who by operation of law, transfer or other means
whatsoever becomes entitled to any share is absolutely bound by
every notice given in accordance with this Article to the person
from whom that person derives title prior to registration of that
person's title in the Register.
Persons entitled to notice of general meeting
20.6 Notice of every general meeting must be given in a manner
authorized by Article 20.1 and in accordance with the
Corporations Law to:
(a) every Member;
(b) every Director and Alternate Director; and
(c) the Auditor.
20.7 No other person is entitled to receive notices of general
meetings.
21 Winding up
Distribution of assets
21.1 If the Company is wound up, the liquidator may, with the sanction
of a special resolution of the Company, divide among the Members
in kind the whole or any part of the property of the Company and
may for that purpose set such value as the liquidator considers
fair on any property to between the Members or different classes
of Members.
45
<PAGE>
21.2 The liquidator may, with the sanction of a special resolution of
the Company, vest the whole or any part of any such property in
trustees on such trusts for the benefit of the contributories as
the liquidator thinks fit, but so that no Member is compelled to
accept any shares or other securities in respect of which there
is any liability.
22 Indemnity
Indemnity of officers
22.1 Every person who is or has been a director, secretary or
executive officer of the Company and its Related Bodies Corporate
may, if the Directors so determine, be indemnified, to the
maximum extent permitted by law, out of the property of the
Company against any liabilities for costs and expenses incurred
by that person:
(a) in defending any proceedings relating to that person's
position with the Company, whether civil or criminal, in
which judgment is given in that person's favor or in which
that person is acquitted or which are withdrawn before
judgment; or
(b) in connection with any administrative proceedings relating
to that person's position with the Company, except
proceedings which give rise to civil or criminal proceedings
against that person in which judgment is not given in that
person's favor or in which that person is not acquitted or
which arise out of conduct involving a lack of good faith;
or
(b) in connection with any application in relation to any
proceedings relating to that person's position with the
Company, whether civil or criminal, in which relief is
granted to that person under the Corporations Law by the
court.
46
<PAGE>
22.2 Every person who is or has been a director, secretary or
executive officer of the Company and its Related Bodies Corporate
may, if the Directors so determine, be indemnified, to the
maximum extent permitted by law, out of the property of the
Company against any liability to another person (other than the
Company or its Related Bodies Corporate) as such an officer
unless the liability arises out of conduct involving a lack of
good faith.
22.3 The Company may pay a premium for a contract insuring a person
who is or has been a director, secretary or executive officer of
the Company and its Related Bodies Corporate against:
(a) any liability incurred by that person as such an officer
which does not arise out of conduct involving a willful
breach of duty in relation to the Company or a contravention
of sections 232(5) or (6) of the Corporations Law; and
(b) any liability for costs and expenses incurred by that person
in defending proceedings relating to that person's position
with the Company, whether civil or criminal, and whatever
their outcome.
47
<PAGE>
The persons whose name and address is subscribed, being the subscriber to the
Memorandum of Association, hereby agrees to the foregoing Articles of
Association.
Rodney Harold Keller
1705/265 Exhibition Street
Melbourne Vic 3000
Signature: Date: 16 June 1998
Witness to above signature:
Narelle Melissa Bridges
42/202 Wattletree Road
Malvern Vic 3144
Occupation: Para Legal
Signature: Date: 16 June 1998
48
<PAGE>
<TABLE>
<CAPTION>
Contents
<S> <C>
1 Preliminary 1
Definitions 1
Interpretation 2
Table A not to apply 2
Proprietary company 3
2 Share capital and variation of rights 3
Directors to issue shares 3
Preference shares 4
Variation of rights 4
Commission and brokerage 5
Recognition and disclosure of interests 6
Right to share and option certificate 6
Joint holders of shares 6
3 Lien 6
Lien on share 6
Sale under lien 7
Transfer on sale under lien 7
Proceeds of sale 8
4 Calls on shares 8
Directors to make calls 8
Time of call 8
Members' liability 9
Interest on default 9
Fixed installments deemed calls 9
Differentiation between shareholders as to calls 10
Prepayment of calls 10
5 Transfer of shares 10
Forms of instrument of transfer 10
Registration procedure 11
Directors may decline to register 11
6 Transmission of shares 11
Transmission of shares on death of holder 11
Right to registration on death or bankruptcy 12
Effect of transmission 12
</TABLE>
<PAGE>
<TABLE>
<S> <C>
7 Forfeiture of shares 13
Notice requiring payment of call 13
Forfeiture for failure to comply with notice 13
Cancellation of forfeiture 14
Effect of forfeiture on former holder's liability 14
Evidence of forfeiture 14
Transfer of forfeited share 15
8 Conversion of shares into stock 15
Company may convert shares into stock 15
Transfer of stock 15
Stockholders' rights 16
Application of Articles to stock 16
9 Alteration of capital 16
Company's power to alter capital 16
Reduction of capital 17
10 General meetings 17
Annual general meeting 17
General meeting 17
Notice of general meeting 17
Special business of general meeting 18
Requisitioned meeting 18
Objects of requisitioned meeting 19
Convening requisitioned meeting 19
Expenses of requisitioned meeting 19
Postponement or cancellation of meeting 19
11 Proceedings at general meetings 20
Representation of Member 20
Quorum 20
Failure to achieve quorum 21
Appointment and powers of chairman of general meeting 21
Adjournment of general meeting 22
Voting at general meeting 22
Questions decided by majority 23
Poll 23
Equality of votes 24
Entitlement to vote 24
Joint shareholders' vote 24
Vote of shareholder of unsound mind 24
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Effect of unpaid call 25
Objection to voting qualification 25
Appointment of proxy 25
Deposit of proxy and other instruments 26
Validity of vote in certain circumstances 26
Director entitled to notice of meeting 27
Resolution in writing 27
12 The Directors 27
Number of Directors 27
Share qualification of Directors 27
Appointment of Director 27
Removal of Director 28
Remuneration of Directors 28
Director's interests 28
Vacation of office of Director 30
13 Powers and duties of Directors 31
Directors to manage Company 31
Appointment of attorney 31
Minutes 32
Execution of Company cheques etc 32
14 Proceedings of Directors 32
Directors' meetings 32
Questions decided by majority 33
Alternate Directors 33
Quorum for Directors' meetings 34
Remaining Directors may act 34
Chairman of Directors 35
Directors' committees 35
Written resolution by Directors 36
Directors' meetings defined 37
Validity of acts of Directors 37
Appointment of Managing and Executive Directors 37
Remuneration of Managing and Executive Directors 37
Powers of Managing and Executive Directors 38
15 Secretary 38
Appointment of Secretary 38
Suspension and removal of Secretary 38
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Powers and duties of Secretary 38
Secretary to attend meetings 39
16 Common seal and official seal 39
Custody of common seal 39
Use of common seal 39
Use of official seals 39
17 Inspection of records 40
Inspection by Members 40
18 Dividends and reserves 40
Declaration of final dividend 40
Directors may authorize interim dividend 40
No interest on dividends 40
Reserves and profits carried forward 41
Calculation and apportionment of dividends 41
Deductions from dividends 42
Distribution of specific assets 42
Payment by cheque and receipts from joint holders 42
Unclaimed dividends 43
19 Capitalization of profits 43
Capitalization of reserves and profits 43
20 Notices 44
Service of notices 44
Persons entitled to notice of general meeting 45
21 Winding up 45
Distribution of assets 45
22 Indemnity 46
Indemnity of officers 46
</TABLE>
<PAGE>
EXHIBIT B-204
State of Delaware
Office of the Secretary of State
__________________________________
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF
DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT
COPY OF THE CERTIFICATE OF INCORPORATION OF "GEDDES II CORP.",
FILED IN THIS OFFICE ON THE TWENTY-FOURTH DAY OF JUNE, A.D.
1998, AT 9 O'CLOCK A.M.
<PAGE>
CERTIFICATE OF INCORPORATION
OF
GEDDES II CORP.
------------------
It is hereby certified that:
FIRST: The name of the corporation (hereinafter called the "corporation")
is Geddes II Corp.
SECOND: The address, including street, number, city and county, of the
registered office of the corporation in the State of Delaware is 1013 Centre
Road, City of Wilmington, Delaware 19805, County of New Castle; and the name of
the registered agent of the corporation in the State of Delaware at such address
is Corporation Service Company.
THIRD: The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
FOURTH: The total number of shares of stock which the corporation shall
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
follows:
NAME MAILING ADDRESS
Michael S. Shenberg c/o Berlack, Israels & Liberman LLP
120 West 45th Street
New York, New York 10036
SIXTH: The board of directors of the corporation is expressly authorized
to adopt, amend or repeal by-laws of the corporation.
<PAGE>
SEVENTH: The personal liability of the directors of the corporation is
hereby eliminated to the fullest extent permitted by paragraph (7) of subsection
(b) of Section 102 of the General Corporation Law of the State of Delaware, as
the same may be amended and supplemented.
EIGHTH: As of the date hereof, the corporation has received no payment
for any of its stock.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of June,
1998.
Michael S. Shenberg
Sole Incorporator
2
<PAGE>
EXHIBIT B-205
GEDDES II CORP.
BY-LAWS
1. The principal office of GEDDES II CORP. (the "Corporation") shall be
in Parsippany, New Jersey. 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
"Delaware". 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders 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 stockholders 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 stockholders 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,
1
<PAGE>
the stockholders 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.
5. Except as otherwise provided by law or by the Certificate of
Incorporation, 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 stockholders. 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
stockholders 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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholders or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. At all elections of directors each
holder of record of shares of capital stock then entitled to vote, shall be
entitled to as many votes as shall equal the number of votes which (except for
such provision) he would be entitled to cast for the election of directors with
respect to his shares of stock multiplied by the number of directors to be
elected and he may cast all such votes for a single director or may distribute
them among the number to be voted for, or any two or more of them, as he may see
fit. Except as otherwise provided by law or by the Certificate of
Incorporation, each holder of record of shares of capital stock entitled to vote
at any meeting of stockholders shall be entitled to one vote for every share of
capital stock standing in his name on the books of the Corporation. 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 thereof, shall not be voted.
All elections shall be determined by a plurality vote, and, except as otherwise
provided by law or by the Certificate of Incorporation all other matters
2
<PAGE>
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.
7. A complete list of the stockholders entitled to vote at any meeting of
stockholders, arranged in alphabetical order, with the residence of each, and
the number of shares held by each, shall 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 stockholder 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 stockholder.
8. Special meetings of the stockholders for any purpose or purposes,
unless otherwise prescribed by law, may be called by the Chairman or by the
President, and shall be called by the chief executive officer or Secretary at
the request in writing of any three members of the Board of Directors, or at the
request in writing of holders of record of ten percent of the shares of capital
stock of the Corporation issued and outstanding. Business transacted at all
special meetings of the stockholders shall be confined to the purposes stated in
the call.
9. (a) Notice of every meeting of stockholders, setting forth the time
and the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more than fifty days prior to such meeting, to each
stockholder of record (at his address appearing on the stock books of the
Corporation, unless he shall have filed with the Secretary of the Corporation a
written request that notices intended for him 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, the Certificate of Incorporation or 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 Certificate of Incorporation under which the
written consent of the holders of less than all outstanding shares is sufficient
for corporate action
3
<PAGE>
DIRECTORS
---------
10. The business and affairs of the Corporation shall be managed by its
Board of Directors, which shall consist of not less than one nor more than nine
directors as shall be fixed from time to time by a resolution adopted by a
majority of the entire Board of Directors; provided, however, that no decrease
in the number of directors constituting the entire Board of Directors shall
shorten the term of any incumbent director. Each director shall be at least
twenty-one years of age. Directors need not be stockholders of the Corporation.
Directors shall be elected at the annual meeting of stockholders, or, if any
such election shall not be held, at a stockholders' meeting called and held in
accordance with the provisions of the General Corporation Law of the State of
Delaware. Each director shall serve until the next annual meeting of
stockholders and thereafter until his 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
Certificate of Incorporation, or by the By-Laws directed or required to be
exercised or done by the stockholders.
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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and the Board
in good faith authorizes the contract or transaction by a vote sufficient for
such purposes without counting the vote of the interested director or directors;
or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to vote thereon,
and the contract or transaction is specifically approved in good faith by vote
of the stockholders; or
4
<PAGE>
(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
stockholders.
No director or officer shall be liable to account to the Corporation for
any profit realized by him from or through any such contract or transaction of
the Corporation by reason of his interest 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 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 purposes 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 stockholders. 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.
5
<PAGE>
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 his duties shall give notice either
personally or by telephone or telegraph 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 a majority of the directors
in office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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, as amended, or by the By-Laws.
17. 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 except such powers as the Board of Directors may exercise by virtue of
Section 11 of the By-Laws. The Executive Committee shall have no power to revoke
any action taken by the Board of Directors, and shall be subject to any
restriction imposed by law, by the By-Laws, or by the Board of Directors.
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
6
<PAGE>
shall be reported to the Board of Directors at its next succeeding meeting, and
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 of 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
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.
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 and benefits for their services as
directors, at such rate or under such conditions 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 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 the Executive Committee or such other Committees
of the Board and of otherwise performing their duties as members of such
Committees.
OFFICERS
--------
23. The officers of the Corporation shall be chosen by a vote of a
majority of the directors in office and shall be a President, one or more Vice
Presidents, a Treasurer, a Secretary, and a Comptroller, and may include a
Chairman, one or more Assistant Secretaries, one or more Assistant Treasurers,
and one
7
<PAGE>
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
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. Neither the Comptroller nor any Assistant Comptroller may occupy any
other office. With the above exceptions, any two offices may be occupied and
the duties thereof may be performed by one person, but no officer shall execute,
acknowledge or verify any instrument in more than one capacity.
24. The salary and other compensation of the chief executive officer of
the Corporation shall be determined from time to time by the Board of Directors.
The salaries and other compensation of all other officers of the Corporation
shall be determined from time to time by the chief executive officer, subject to
the concurrence of the Chairman.
25. The salary or other compensation of all employees other than officers
of the Corporation 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.
26. 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, and perform such duties as shall be
determined from time to time 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
stockholders 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 the directors 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, 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, he shall
preside at all meetings of the Board at which he shall be present.
8
<PAGE>
(b) If a Chairman shall be chosen by the Board of Directors and if he
shall be designated by the Board as chief executive officer of the Corporation:
(i) he 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) he 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
Corporations;
(iii) he 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 him and act and vote on behalf of
the Corporation at all meetings of stockholders of any corporation
in which the Corporation holds stock and grant any consent, waiver,
or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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 if he
shall not be designated by the Board as chief executive officer of the
Corporation.
(i) he 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
9
<PAGE>
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;
(ii) he 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 he shall be
present.
(b) If the President shall be designated by the Board of Directors as
chief executive officer of the Corporation.
(i) he 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) he 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) he 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders of
any corporation in which the Corporation holds stock and grant
any consent, waiver, or power of attorney in respect of such
stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of
the Corporation whose duties are not otherwise defined; and
10
<PAGE>
(v) he 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 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders 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 his opinion 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.
11
<PAGE>
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 Directors and the Executive Committee, if there be one.
(b) He 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, 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) He 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 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 him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which the
Corporation holds stock and grant any consent, waiver or power of attorney in
respect of such stock.
(d) He 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
or a Senior 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.
12
<PAGE>
THE SECRETARY
-------------
31. (a) The Secretary shall attend all meetings of the Board of Directors
and all meetings of the stockholders and record all votes and the minutes of all
proceedings in books to be kept for that purpose; and he shall perform like
duties for the Executive Committee and any other committees created by the Board
of Directors.
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which notice
is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He 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) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
in his custody full and accurate accounts of receipts and disbursements in books
belonging to the Corporation, and shall deposit all moneys and
13
<PAGE>
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) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other property
of whatever kind in his possession or under his control belonging to the
Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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.
14
<PAGE>
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 his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the Board or any
director of the Corporation, and shall render a full financial report at the
annual meeting of the stockholders, if called upon to do so.
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other
15
<PAGE>
powers and duties as may be conferred or required 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.
VACANCIES
---------
34. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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. Any 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 acceptance, 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 the total number of directors provided for
in Section 10 of the By-Laws may, notwithstanding any 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 office under the
General Corporation
16
<PAGE>
Law of the State of Delaware, 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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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.
(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 he 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 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
17
<PAGE>
by such person with respect to any 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 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
shareholder, or disinterested directors or otherwise, both as to action in an
official capacity and as to action 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
stockholders 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.
18
<PAGE>
CERTIFICATE 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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 stockholders 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 stockholders 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 stockholders of
record at such time shall be entitled to receive any such notice, dividend,
distribution, rights or interests.
REGISTERED STOCKHOLDERS
-----------------------
42. The Corporation shall be entitled to treat the holder of record 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
19
<PAGE>
part of any other person, whether or not it shall have express or other notice
thereof, save as expressly provided by statutes of the State of Delaware.
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
-------------------
44. The Board of Directors may determine whether and to what extent, and
at what time the 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 stockholders), or any of them, shall be open to the
inspection of stockholders, and no stockholder 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 state of Delaware or by the By-Laws or by
resolution of the Board of Directors or of the stockholders.
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 of
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
20
<PAGE>
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 Chairman or 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
Chairman or the President or a Vice President and the Secretary or an Assistant
Secretary or the Treasurer or 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 facsimile signature appears thereon, had not
ceased to be such officer of the Corporation.
RECEIPTS FOR SECURITIES
-----------------------
46. All receipts for stocks, bonds or other securities received 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 to vary, the amount to be reserved as working capital; to
determine whether any, and if
21
<PAGE>
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
interest of the Corporation.
DIRECTORS' ANNUAL STATEMENT
---------------------------
49. The Board of Directors shall present or cause to be presented at each
annual meeting of stockholders, and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
NOTICES
-------
50. (a) Whenever under the provisions of the By-Laws notice is required
to be given to any director, officer of stockholder, it shall not be construed
to require personal notice, but, except as otherwise specifically provided, such
notice may be given in writing, by mail, by depositing a copy of the same in a
post office, letter box or mail chute, maintained by the United States Postal
Service, postage prepaid, addressed to such stockholder, officer or director, at
his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
PARTICIPATION IN MEETINGS BY TELEPHONE
--------------------------------------
51. At any meeting of the Board of Directors or the Executive Committee or
any other committee designated by the Board of Directors, one or more directors
may participate in such meeting in lieu of attendance in person by 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
--------------------------
52. The judges of election appointed to act at any meeting of the
stockholders 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.
22
<PAGE>
AMENDMENTS
----------
53. 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 stockholders 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 the directors 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
stockholders 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.
23
<PAGE>
Exhibit B-206
The Companies Act 1985
(As amended by the Companies Act 1989)
_________________________________
PRIVATE COMPANY LIMITED BY SHARES
_________________________________
ARTICLES OF ASSOCIATION
OF
MIDLANDS POWER INTERNATIONAL LIMITED
(As amended by Special Resolution passed on 3rd April 1995)
1 Preliminary
-----------
1.1 Subject as hereinafter provided the Regulations incorporated in Table
A as set out in the Schedule to the Companies (Tables A to F)
Regulations 1985 as amended and hereinafter called "Table A: shall
apply to the Company.
1.2 The Articles hereinafter contained, together with the Regulations
incorporated in Table A subject to their exclusions or modification
hereinafter expressed, shall constitute the Regulations of the
Company.
1.3 Any reference in these Articles to "The Act" shall mean the Companies
Act 1985 as amended or extended by any other enactment.
2 Interpretation
--------------
In Regulation 1 of Table A there shall be inserted before the words
"office" and "secretary" the word "the" and between the words "regulations"
and "the Act" the words "and in any regulations adopting in whole or in
part the same".
3 Allotment of Shares
-------------------
3.1 Subject to the provisions hereinafter expressed, the Directors are
authorized for the purposes of Section 80 of the Act to exercise the
power of the Company to allot shares to the amount of the
1
<PAGE>
authorized but unissued share capital of the Company at the date
hereof and the Directors may allot, grant options over or otherwise
dispose of such shares to such persons, on such terms and in such
manner as they think fit provided always that:-
3.1.1 save as provided in sub-paragraph 3.1.2 below, the authority
hereby given to the Directors to exercise the power of the
Company to allot shares shall expire five years after the date
of incorporation of the Company;
3.1.2 the Members in General Meeting may by Ordinary Resolution:-
3.1.2.1 renew the said authority (whether or not it has been
previously renewed) for a period not exceeding five
years (unless the Company elects by elective
resolution to modify the duration of authority
pursuant to Section 80A of the Companies Act 1985),
but such Resolution shall comply with the Act;
3.1.2.1 revoke or vary any such authority (or renewed
authority);
3.1.3 notwithstanding the aforementioned provisions of sub-
paragraphs 3.1.1 and 3.1.2 the Company may make an offer or
agreement which would or might require shares to be allotted
after such authority has expired and in pursuance of such an
offer or agreement the Directors may allot shares
notwithstanding that such authority or renewed authority has
expired.
Any reference hereto to the allotment of shares shall include a
reference to the grant of any right to subscribe for, or to convert
any security into shares, but shall not include any reference to the
allotment of shares pursuant to such a right.
2
<PAGE>
3.2 In accordance with Section 91 of the Act, Sections 89(1), and 90(1) to
(6) of the Act are excluded from applying to the Company. Any shares
for the time being unissued shall be offered to the Members in
proportion as nearly as may be to the number of existing shares held
by them respectively unless the Company shall by Special Resolution
otherwise direct. Such offer shall be made by written notice
specifying the number of shares offered and specifying a period (not
being less than fourteen days) within which the offer, if not
accepted, will lapse and determine. After the expiration of that
period, or on the receipt of an intimation in writing from the
offerree that he declines to accept the shares so offered, the
Directors may in accordance with the provisions hereto allot, grant
options over or otherwise dispose of the same to such persons, on such
terms and in such manner as they think most beneficial to the Company.
The Directors may in like manner and subject as aforesaid, allot any
such new or original shares which by reason of the proportion borne by
them to the number of persons entitled to any such offer as aforesaid
or by reason of any other difficulty in apportioning the same cannot
in the view of the Directors effectually be offered in the manner
aforesaid.
4 Shares
------
4.1 Subject to Chapter VII of Part V of the Act, and to the Regulations of
the Company, the Company may purchase its own shares (including
redeemable shares) whether out of distributable profits or the
proceeds of a fresh issue of shares or otherwise.
4.2 Regulation 35 of Table A shall not apply to the Company.
4.3 Subject to Chapter VII of Part V of the Act, any shares may, with the
sanction of an Ordinary Resolution, be issued on the terms that they
are, at the option of the Company or the shareholder, liable to be
redeemed on such terms and in such manner as the Company before the
issue of the
3
<PAGE>
shares may by Special Resolution determine, and whether out of
distributable profits or the proceeds of a fresh issue of shares or
otherwise. Regulation 3 of Table A shall be modified accordingly.
4.4 Subject to Chapter VI of Part V of the Act, the Company may give
financial assistance for the purpose of or in connection with any
acquisition of shares made or to be made in the Company or its holding
company
5 The lien conferred by Regulation 8 of Table A shall attach to all shares
whether fully paid or not and to all shares registered in the name of any
person indebted or under liability to the Company whether he be the sole
holder thereof or one of two or more joint holders. The company shall have
a first and paramount lien on every share (not being fully paid) for all
moneys (whether presently payable or not) called or payable at a fixed time
in respect of that share and the Company shall also have a first and
paramount lien on all shares (including fully paid shares) registered in
the name of any person indebted or under liability to the Company whether
he be the sole holder thereof or one of two or more joint holders for all
moneys presently payable by him or his estate to the Company; but the
Directors may at any time declare any shares to be wholly or in part exempt
from these provisions. The Company's lien, if any, on a share shall extend
to all dividends payable thereon. Regulation 8 of table A shall be
modified accordingly.
6 General Meetings and Resolutions
--------------------------------
6.1 Any ;proxy appointed by a member of the Company in accordance with
Section 372 of the Act shall be entitled to vote on a show of hands as
well as on a poll, provided that no person present shall be entitled
to more than one vote on a show of hands save as provided in
Regulation 50 of Table A.
6.2 In every notice convening a General Meeting of the Company there shall
appear with reasonable prominence a statement that a Member entitled
to attend and vote is entitled to appoint a proxy to attend and, on a
poll, or a show of hands to vote
4
<PAGE>
instead of him and that such proxy need not also be a member.
6.3 Regulations 38 and 59 of Table A shall be modified accordingly.
6.4 Proxies may be deposited at the Registered Office of the Company at
any time before the time of the Meeting for which they are to be used
unless otherwise specified in the notice convening such Meeting. The
Directors may at their discretion treat a facsimile transmission or
other machine made copy of an instrument appointing a proxy as a proxy
for the purpose of this Article. Regulation 62 of table A shall be
modified accordingly.
7 A Resolution in writing signed or approved by letter, telex, facsimile
transmission or cable by all members of the Company, who would have been
entitled to vote upon it if it had been duly proposed at a General Meeting
or at a meeting of any class of members of the Company, or by their duly
appointed attorneys, shall be as valid and effectual as if it had been
passed at a General Meeting or at such a class meeting of the Company (as
the case may be) duly convened and held. Any such Resolution may consist
of several documents in the like form each signed by one or more of the
members or their attorneys (or, in the case of member which is a body
corporate, by a director thereof or by a duly appointed representative).
Regulation 53 of Table A shall not apply to the Company.
8 Appointment of Directors
------------------------
8.1 Unless and until otherwise determined by the Company in General
Meeting there shall be no maximum number of Directors and the minimum
number of Directors shall be one. Whenever there shall be only one
Director of the Company such Director may act alone in exercising all
the powers, discretions and authorities vested in the Directors, and
Regulation 89 of Table A shall be modified accordingly.
8.2 Regulation 64 of Table A shall not apply to the Company.
5
<PAGE>
9 9.1 The Directors shall not be required to retire by rotation and
Regulations 73 to 80 (inclusive) of Table A shall not apply to the
Company.
9.2 No person shall be appointed a Director at any General Meeting unless
either:-
9.2.1 he is recommended by the Directors; or
9.2.2 not less than fourteen nor more than thirty-five clear days
before the date appointed for the General Meeting, notice
executed by a Member qualified to vote at the General Meeting
has been given to the Company of the intention to propose that
person for appointment, together with notice executed by that
person of his willingness to be appointed.
9.3 Subject to paragraph 9.2 above, the Company may by Ordinary Resolution
in General Meeting appoint any person who is willing to act to be a
Director, either to fill a vacancy or as an additional Director.
9.4 The Directors may appoint a person who is willing to act to be a
Director, either to fill a vacancy or as an additional Director,
provided that the appointment does not cause the number of Directors
to exceed any number determined by the Company in General Meeting as
the maximum number of Directors for the time being in force.
9.5 Regulation 84 of Table A shall be modified by the deletion of the last
sentence therefrom.
10 Proceedings of Directors
------------------------
Notice of a meeting of the Directors shall be deemed to be properly given
to a Director if it is given to him personally or by word of mouth or sent
in writing to him at his last known address or any other address given by
him to the Company for this purpose, or by any other means authorized in
writing by the Director concerned. A Director absent or intending to be
absent from the United Kingdom may request the Directors that notices of
meetings of the Directors
6
<PAGE>
shall during his absence be sent in writing to him at an address or to a
facsimile or telex number given by him to the Company for this purpose, but
if no request is made to the Directors it shall not be necessary to give
notice of a meeting of the Directors to any Director who is for the time
being absent from the United Kingdom. A director may waive notice of any
meeting either retrospectively or prospectively. Regulation 88 of the
Table A shall be modified accordingly.
11 All or any of the members of the board or any committee of the board may
participate in a meeting of the board or that committee by means of a
conference telephone or any communication equipment which allows all person
participating in the meeting to hear each other. A person so participating
shall be deemed to be present in person at the meeting and shall be
entitled to vote or be counted in a quorum accordingly. Such a meeting
shall be deemed to take place where the largest of the group of those
participating is assembled, or, if there is no such group where the
Chairman of the meeting then is.
12 12.1 A Director who is in any way either directly or indirectly interested
(whether through persons connected with him as defined in section 346
of the Act or otherwise) in any contract, transaction or arrangement
(whether or not constituting a contract and whether actual or
proposed) with the Company or in which the Company is otherwise
interested, shall declare the nature of his interest at a Meeting of
the Directors in accordance with section 317 of the Act. Subject to
such disclosure a director shall be entitled to vote in respect of any
such contract, transaction or arrangement (whether actual or proposed)
in which he is interested and he shall be counted in reckoning whether
a quorum is present.
12.2 Regulations 94 to 97 (inclusive) of table A shall not apply to the
Company.
7
<PAGE>
13 Borrowing Powers
----------------
The Directors may exercise all the powers of the Company to borrow money,
whether in excess of the nominal amount of the share capital of the Company
for the time being issued or not, and to mortgage or charge its
undertaking, property and uncalled capital or any part thereof, and to
issue debentures, debenture stock or any other securities whether outright
or as security for any debt, liability or obligation of the Company or of
any third party.
14 Disqualification of Directors
-----------------------------
The office of a Director shall be vacated if he becomes incapable by reason
of illness or injury of managing and administering his property and affairs
and Regulation 81 of Table A shall be modified accordingly.
15 Gratuities and Pensions
-----------------------
In regulation 87 of Table A there shall be inserted between the words "the
directors" and "may" the words "on behalf of the Company".
16 Dividends
---------
No dividend or interim dividend shall be paid otherwise than in accordance
with the provisions of Part VIII of the Act which apply to the Company.
17 Notices
-------
17.1 Any notice or other document may be served on or delivered to any
Member by the Company either personally, or by sending it by post
addressed to the Member at his registered address or by facsimile
transmission or telex or other instantaneous means of transmission to
a number provided by the Member for this purpose, or by leaving it at
his registered address addressed to the Member, or by any other means
authorized in writing by the Member concerned. In the case of joint
holders of a share, service or delivery of any notice or other
document on or to one of the joint holders shall for all purposes be
deemed a
8
<PAGE>
sufficient service on or delivery to all the joint holders.
Regulation 112 of Table A shall be modified accordingly.
17.2 Any notice or other document, which is sent by post, shall be deemed
to have been served or delivered 24 hours after posting and, in
proving such service or delivery, it shall be sufficient to prove that
the notice or document was properly addressed, stamped and put in the
post. Any notice or other document left at a registered address
otherwise than by post or sent by facsimile transmission or telex or
other instantaneous means of transmission, shall be deemed to have
been served or delivered when it was so left or sent. Regulation 115
of Table A shall not apply.
18 Execution of Documents
----------------------
The seal, if any, shall only be used by the authority of the Directors or
of a committee of Directors authorized by the Directors. The Directors may
determine who shall sign any instrument to which the seal if affixed and
unless otherwise so determined it shall be signed by a Director and by the
Secretary or by a second Director. Any document signed by a Director and
the Secretary of the Company or by two Directors of the Company and
expressed (in whatever form of words) to be executed by the Company has the
same effect as if executed under the seal of the Company. A document shall
only be so signed with the authority of a resolution of the Directors or a
committee of the Directors. Regulation 101 of Table A shall not apply to
the Company.
19 Indemnity
---------
19.1 The Company shall in accordance with Section 310(3) of the Act pay for
any liability insurance and also indemnify any director, Officer or
Auditor of the Company against any liability incurred by him in
defending any proceedings (whether civil or criminal) in which
judgment is given in his favor or he is acquitted an any connection
with an application under Section 144(3) or (4) or Section 727 in
which relief is
9
<PAGE>
granted to him by the court from liability for negligence, default,
breach of duty or breach of trust in relation to the affairs of the
Company.
19.2 Regulation 118 in Table A shall not apply to the Company
20 Transfer of Shares
------------------
The Directors may in their absolute discretion and without assigning any
reason therefor, decline to register the transfer of a share, whether or
not it is a fully paid share. The first sentence of Regulation 24 of Table
A shall not apply to the Company.
10
<PAGE>
Minutes of the Avon Energy Partners Holdings
Board Meeting held on Wednesday 12 March 1997
Present: Mr. Jim Rogers (Chairman)
Ms. Cheryl Foley
Mr. Bruce Levy
Mr. John Graham
In attendance: H. C. Hamilton, Company Secretary
Mr. Fred Hafer
Mr. Mike Sample
Ms. Lisa Gamblin
Mr. Bill Sheafer
Mr. Mike Hughes
Mr. Stephen King
Mr. John Bryant
Mr. Roger Murray
1. APPOINTMENT OF COMPANY SECRETARY
--------------------------------
It was agreed that Mr. Hugh C. Hamilton should be appointed Company
Secretary of the Company with immediate effect in place of Hackwood
Secretaries Limited.
2. CHANGE OF ACCOUNTING REFERENCE DATE
-----------------------------------
It was agreed that this item should be deferred to the next Meeting.
3. COMMON SEAL
-----------
It was resolved that each Director of the Company be and is hereby
appointed a Committee of the Directors for the purposes of authorizing the
scaling of all or any documents required to be executed under seal prior to
the next Board Meeting.
4. There being no further business, the Meeting terminated.
___________________
CHAIRMAN
<PAGE>
Exhibit B-207
CERTIFICATE OF INCORPORATION
OF
GPU BRASIL, INC.
_________________________
The undersigned, a natural person, for the purpose of organizing a
corporation for conducting the business and promoting the purposes hereinafter
stated, upon the provisions and subject to the requirements of the laws of the
State of Delaware (particularly, Chapter 2, Title 8 of the Delaware Code and the
acts amendatory thereof and supplemental thereto, and known, identified and
referred to as the "General Corporation Law of the State of Delaware"), hereby
certifies that:
FIRST: The name of the corporation (hereinafter referred to as the
-----
"Corporation") is GPU BRASIL, INC.
SECOND: The address, including street, number, city and county, of the
------
registered office of the Corporation in the State of Delaware is: CORPORATION
TRUST CENTER, 1209 ORANGE STREET, CITY OF WILMINGTON, COUNTY OF NEW CASTLE: and
the name of the registered agent of the Corporation in the State of Delaware at
such address is THE CORPORATION TRUST COMPANY.
THIRD: The purpose of the corporation is to conduct any lawful business,
-----
to promote any lawful purpose and to engage in any lawful act or activity for
which corporations may be organized under the General Corporation Law of the
State of Delaware.
FOURTH: The total number of shares of stock which the corporation shall
------
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
-----
follows:
NAME MAILING ADDRESS
---- ---------------
James L. Howard c/o GPU International, Inc.
One Upper Pond Road
Parsippany, NJ 07054
SIXTH: The Corporation is to have perpetual existence.
-----
1
<PAGE>
SEVENTH: The board of directors of the corporation is expressly authorized
-------
to adopt, amend or repeal by-laws of the corporation.
EIGHTH: The personal liability of the directors of the corporation is
------
hereby eliminated to the fullest extent permitted by the provisions of paragraph
(7) of subsection (b) of Section 102 of the General Corporation Law of the State
of Delaware, as the same may be amended and supplemented.
NINTH: The Corporation shall, to the fullest extent permitted by the
-----
provisions of Section 145 of the General Corporation Law of the State of
Delaware, as the same may be amended and supplemented, indemnify any and all
persons whom it shall have power to indemnify under said section from and
against any and all of the expenses, liabilities, or other matters referred to
in or covered by said section, and the indemnification provided for herein shall
not be deemed exclusive of any other rights to which those indemnified may be
entitled under any By-Law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee, or agent and shall
enure to the benefit of the heirs, executors, and administrators of such a
person.
TENTH: From time to time any of the provisions of this certificate of
-----
incorporation may be amended, altered, or repealed, and other provision
authorized by the laws of the State of Delaware at the time in force may be
added or inserted in the manner and at the time prescribed by said laws, and all
rights at any time conferred upon the stockholders of the Corporation by this
certificate of incorporation are granted subject to the provisions of this
Article TENTH.
IN WITNESS WHEREOF, I have hereunto set my hand this 25th day of February,
1998.
_______________________________
________________________ James L. Howard
Sole Incorporator
2
<PAGE>
EXHIBIT B-209
___________________________________________________________________
________________________
GPU BRASIL, INC.
By-Laws
________________________
__________________________________________________________________
__________________________________________________________________
<PAGE>
BY-LAWS
1. The principal office of GPU BRASIL, INC. (the "Corporation") shall be
in Parsippany, New Jersey. 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
"Delaware". 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders 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 stockholders 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 stockholders 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 stockholders
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.
5. Except as otherwise provided by law or by the Certificate of
Incorporation, the holders of a majority of the
1
<PAGE>
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 stockholders. 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 stockholders 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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholders or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. At all elections of directors each
holder of record of shares of capital stock then entitled to vote, shall be
entitled to as many votes as shall equal the number of votes which (except for
such provision) he would be entitled to cast for the election of directors with
respect to his shares of stock multiplied by the number of directors to be
elected and he may cast all such votes for a single director or may distribute
them among the number to be voted for, or any two or more of them, as he may see
fit. Except as otherwise provided by law or by the Certificate of
Incorporation, each holder of record of shares of capital stock entitled to vote
at any meeting of stockholders shall be entitled to one vote for every share of
capital stock standing in his name on the books of the Corporation. 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 thereof, shall not be voted.
All elections shall be determined by a plurality vote, and, except as otherwise
provided by law or by the Certificate of Incorporation 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.
7. A complete list of the stockholders entitled to vote at any meeting
of stockholders, arranged in alphabetical order, with the residence of each, and
the number of shares held by each, shall be prepared by the Secretary and filed
in the principal office of
2
<PAGE>
the Corporation at least fifteen days before the meeting, and shall be open to
the examination of any stockholder 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 stockholder.
8. Special meetings of the stockholders for any purpose or purposes,
unless otherwise prescribed by law, may be called by the Chairman or by the
President, and shall be called by the chief executive officer or Secretary at
the request in writing of any three members of the Board of Directors, or at the
request in writing of holders of record of ten percent of the shares of capital
stock of the Corporation issued and outstanding. Business transacted at all
special meetings of the stockholders shall be confined to the purposes stated in
the call.
9. (a) Notice of every meeting of stockholders, setting forth the time
and the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more than fifty days prior to such meeting, to each
stockholder of record (at his address appearing on the stock books of the
Corporation, unless he shall have filed with the Secretary of the Corporation a
written request that notices intended for him 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, the Certificate of Incorporation or 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 Certificate 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 by its
Board of Directors, which shall consist of not less than one nor more than nine
directors as shall be fixed from time to time by a resolution adopted by a
majority of the entire Board of Directors; provided, however, that no decrease
in the number of
3
<PAGE>
directors constituting the entire Board of Directors shall shorten the term of
any incumbent director. Each director shall be at least twenty-one years of
age. Directors need not be stockholders of the Corporation. Directors shall be
elected at the annual meeting of stockholders, or, if any such election shall
not be held, at a stockholders' meeting called and held in accordance with the
provisions of the New Jersey Business Corporation Act. Each director shall
serve until the next annual meeting of stockholders and thereafter until his
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
Certificate of Incorporation, or by the By-Laws directed or required to be
exercised or done by the stockholders.
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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and
the Board in good faith authorizes the contract or transaction by a
vote sufficient for such purposes without counting the vote of the
interested director or directors; or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to
vote thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; 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 stockholders.
No director or officer shall be liable to account to the Corporation
for any profit realized by him from or through any such contract or transaction
of the Corporation by reason of his
4
<PAGE>
interest 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 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 purposes 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 stockholders. 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 his duties shall give notice
5
<PAGE>
either personally or by telephone or telegraph 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 a majority of the directors
in office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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, as amended, or by the By-Laws.
17. 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 except such powers as the Board of Directors
may exercise by virtue of Section 11 of the By-Laws. The Executive Committee
shall have no power to revoke any action taken by the Board of Directors, and
shall be subject to any restriction imposed by law, by the By-Laws, or by the
Board of Directors.
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, and 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 of 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 vacancies in the
Executive Committee.
6
<PAGE>
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.
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 and benefits for their services as
directors, at such rate or under such conditions 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 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 the Executive Committee or such other Committees
of the Board and of otherwise performing their duties as members of such
Committees.
Officers
--------
23. The officers of the Corporation shall be chosen by a vote of a
majority of the directors in office and shall be a President, one or more Vice
Presidents, a Treasurer, a Secretary, and a Comptroller, and may include a
Chairman, 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
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. Neither the Comptroller nor any Assistant Comptroller may occupy any
other office. With the above
7
<PAGE>
exceptions, any two offices may be occupied and the duties thereof may be
performed by one person, but no officer shall execute, acknowledge or verify any
instrument in more than one capacity.
24. The salary and other compensation of the chief executive officer of
the Corporation shall be determined from time to time by the Board of Directors.
The salaries and other compensation of all other officers of the Corporation
shall be determined from time to time by the chief executive officer, subject to
the concurrence of the Chairman.
25. The salary or other compensation of all employees other than officers
of the Corporation 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.
26. 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, and perform such duties as shall be
determined from time to time 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
stockholders 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 the directors 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, 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, he
shall preside at all meetings of the Board at which he shall be present.
(b) If a Chairman shall be chosen by the Board of Directors and if he
shall be designated by the Board as chief executive officer of the Corporation:
(i) he shall have supervision, direction and control of the
conduct of the business of the Corporation, subject, however, to
the control of the
8
<PAGE>
Board of Directors and the Executive Committee, if there be one;
(ii) he 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 Corporations;
(iii) he 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 him and act and vote on
behalf of the Corporation at all meetings of stockholders of any
corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of
the Corporation whose duties are not otherwise defined; and
(v) he 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 if he
shall not be designated by the Board as chief executive officer of the
Corporation.
(i) he 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;
9
<PAGE>
(ii) he 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 he shall be
present.
(b) If the President shall be designated by the Board of Directors as
chief executive officer of the Corporation.
(i) he 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) he 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) he 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders of
any corporation in which the Corporation holds stock and grant
any consent, waiver, or power of attorney in respect of such
stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of
the Corporation whose duties are not otherwise defined; and
(v) he 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.
10
<PAGE>
(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 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders 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 his opinion 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
11
<PAGE>
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 Directors and the Executive
Committee, if there be one.
(b) He 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, 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) He 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 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 him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which the
Corporation holds stock and grant any consent, waiver or power of attorney in
respect of such stock.
(d) He 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
or a Senior 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 stockholders and record all votes and the
minutes of all proceedings in books to be kept for that purpose; and he shall
perform like duties for the Executive
12
<PAGE>
Committee and any other committees created by the Board of Directors.
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which notice
is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He 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) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
in his custody 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.
13
<PAGE>
(b) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other property
of whatever kind in his possession or under his control belonging to the
Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
14
<PAGE>
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 his
office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the Board or any
director of the Corporation, and shall render a full financial report at the
annual meeting of the stockholders, if called upon to do so.
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other powers and duties as may be conferred or required 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.
15
<PAGE>
Vacancies
---------
34. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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. Any 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 acceptance, 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 the total number of directors provided for
in Section 10 of the By-Laws may, notwithstanding any 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 office under the
New Jersey Business Corporation Act, 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.
16
<PAGE>
(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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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.
(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 he 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 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 any 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.
17
<PAGE>
(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 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
shareholder, or disinterested directors or otherwise, both as to action in an
official capacity and as to action 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
stockholders 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.
18
<PAGE>
Certificate 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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 stockholders 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 stockholders 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 stockholders of
record at such time shall be entitled to receive any such notice, dividend,
distribution, rights or interests.
Registered Stockholders
-----------------------
42. The Corporation shall be entitled to treat the holder of record 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
19
<PAGE>
of any other person, whether or not it shall have express or other notice
thereof, save as expressly provided by statutes of the State of New Jersey.
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
-------------------
44. The Board of Directors may determine whether and to what extent, and
at what time the 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 stockholders), or any of them, shall be open to the
inspection of stockholders, and no stockholder 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 state of New Jersey or by the By-Laws or by
resolution of the Board of Directors or of the stockholders.
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 of
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.
20
<PAGE>
(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 Chairman or 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 Chairman or the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or
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 facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
Receipts for Securities
-----------------------
46. All receipts for stocks, bonds or other securities received 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.
21
<PAGE>
(b) The Board of Directors shall have power to fix and determine, and
from time to time to 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 interest of the Corporation.
Directors' Annual Statement
---------------------------
49. The Board of Directors shall present or cause to be presented at each
annual meeting of stockholders, and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
Notices
-------
50. (a) Whenever under the provisions of the By-Laws notice is
required to be given to any director, officer of stockholder, it shall not be
construed to require personal notice, but, except as otherwise specifically
provided, such notice may be given in writing, by mail, by depositing a copy of
the same in a post office, letter box or mail chute, maintained by the United
States Postal Service, postage prepaid, addressed to such stockholder, officer
or director, at his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
Participation in Meetings by Telephone
--------------------------------------
51. At any meeting of the Board of Directors or the Executive
Committee or any other committee designated by the Board of Directors, one or
more directors may participate in such meeting in lieu of attendance in person
by 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.
22
<PAGE>
Oath of Judges of Election
--------------------------
52. The judges of election appointed to act at any meeting of the
stockholders 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
----------
53. 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 stockholders 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 the
directors 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
stockholders 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.
23
<PAGE>
EXHIBIT B-209
CERTICITATE OF INCORPORATION
OF
GPU INTERNAITONAL ASIA, INC.
It hereby certified that:
FIRST: The name of the corporation (hereinafter called the "corporation")
-----
is GPU International Asia, Inc.
SECOND: The address, including street, number, city and county, of the
------
registered office of the corporation in the State of Delaware is 32 Loockerman
Square, Suite L-100, City of Dover, County of Kent; and the name of the
registered agent of the corporation in the State of Delaware at such address is
CSC The United States Corporation Company.
THIRD: The purpose of the corporation is to engage in any lawful act or
-----
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
FOURTH: The total number of shares of stock which the corporation shall
------
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
-----
follows:
NAME MAILING ADDRESS
---- ---------------
Wendy S. Greengrove c/o GPU Power, inc.
One Upper Pond Road
Parsippany, NJ 07054
SIXTH: The board of directors of the corporation is expressly authorized
-----
to adopt, amend or repeal by-laws of the corporation.
SEVENTH: The personal liability of the directors of the corporation is
-------
hereby eliminated to the fullest extent permitted by paragraph (7) of subsection
(b) of Section 102 of the General Corporation Law of the State of Delaware, as
the same may be amended and supplemented.
<PAGE>
EIGHTH: As of the date hereof, the corporation has received no payment for
------
any of its stock.
IN WITHNESS WHEREOF, I have hereunto set my hand this 9th day of January,
1997.
/s/ Wendy S. Greengrove
----------------------------
Wendy S. Greengrove
Sole Incorporator
2
<PAGE>
Exhibit B-210
GPU INTERNATIONAL ASIA, INC.
BY-LAWS
Adopted January 10, 1997
OFFICES
-------
1. The Corporation shall have offices at such 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
"Delaware". 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders shall be held on such date and time
as shall be determined by the Board of Directors. At the annual meeting, the
stockholders entitled to vote shall elect by ballot a Board of Directors and
transact such other business as may properly be brought before the meeting.
5. Except as otherwise provided by law or by the Certificate of
Incorporation, 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
1
<PAGE>
the stockholders. 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
stockholders 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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholders or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. Except as otherwise provided by law
or by the Certificate of Incorporation, each holder of record of shares of
capital stock entitled to vote at any meeting of stockholders shall be entitled
to one vote for every share of capital stock standing in his name on the books
of the Corporation. 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 thereof,
shall not be voted. All elections shall be determined by a plurality vote, and,
except as otherwise provided by law or by the Certificate of Incorporation 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.
7. Special meetings of the stockholders for any purpose or purposes,
unless otherwise prescribed by law, may be called by the Chairman or by the
President, and shall be called by the chief executive officer or Secretary at
the request in writing of any three members of the Board of Directors, or at the
request in writing of holders of record of ten percent of the shares of capital
stock of the Corporation issued and outstanding. Business transacted at all
special meetings of the stockholders shall be confined to the purposes stated in
the call.
8. (a) Notice of every meeting of stockholders, setting forth the time
and the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more
2
<PAGE>
than fifty days prior to such meeting, to each stockholder of record (at his
address appearing on the stock books of the Corporation, unless he shall have
filed with the Secretary of the Corporation a written request that notices
intended for him 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, the Certificate of Incorporation or 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 Certificate of Incorporation under which the
written consent of the holders of less than all outstanding shares is sufficient
for corporate action.
Directors
---------
9. The business and affairs of the Corporation shall be managed by its
Board of Directors, which shall consist of not less than one nor more than six
directors as shall be fixed from time to time by a resolution adopted by a
majority of the entire Board of Directors; provided, however, that no decrease
in the number of directors constituting the entire Board of Directors shall
shorten the term of any incumbent director. Each director shall be at least
twenty-one years of age. Directors need not be stockholders of the Corporation.
Directors shall be elected at the annual meeting of stockholders, or, if any
such election shall not be held, at a stockholders' meeting called and held in
accordance with the provisions of the General Corporation Law of the State of
Delaware. Each director shall serve until the next annual meeting of
stockholders and thereafter until his successor shall have been elected and
shall qualify.
10. 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
Certificate of Incorporation, or by the By-Laws directed or required to be
exercised or done by the stockholders.
3
<PAGE>
11. 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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and the Board
in good faith authorizes the contract or transaction by a vote sufficient for
such purposes without counting the vote of the interested director or directors;
or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to vote thereon,
and the contract or transaction is specifically approved in good faith by vote
of the stockholders; 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
stockholders.
No director or officer shall be liable to account to the Corporation
for any profit realized by him from or through any such contract or transaction
of the Corporation by reason of his interest 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 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 11, nor shall any such director be
liable to account because of such relation. For the purposes of this Section
11, 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.
4
<PAGE>
Nothing herein shall create liability in any of the events described
in this Section 11 or prevent the authorization, ratification or approval, in
any other manner provided by law, of any contract or transaction described in
this Section 11.
Meetings of the Board of Directors
----------------------------------
12. 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. 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.
13. 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 his duties shall give notice either
personally or by telephone or telecopy 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.
14. At all meetings of the Board of Directors a majority of the directors
in office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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
Certificate of Incorporation, as amended, or by the By-Laws.
15. 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
----------
16. 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
5
<PAGE>
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
except such powers as the Board of Directors may exercise by virtue of Section
10 of the By-Laws. The Executive Committee shall have no power to revoke any
action taken by the Board of Directors, and shall be subject to any restriction
imposed by law, by the By-Laws, or by the Board of Directors.
17. 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. 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 9 of the By-
Laws fill any 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.
18. 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.
Compensation and Reimbursement of Directors
-------------------------------------------
and Members of the Executive Committee
--------------------------------------
19. Directors, other than salaried officers of the Corporation or its
affiliates, shall receive compensation and benefits for their services as
directors, at such rate or under such conditions 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.
20. 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
6
<PAGE>
such members 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 the
Executive Committee or such other Committees of the Board and of otherwise
performing their duties as members of such Committees.
Officers
--------
21. The officers of the Corporation shall be chosen by a vote of a
majority of the directors in office and shall be a President, one or more Vice
Presidents, a Treasurer, and a Secretary, and may include a Chairman,
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 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. Neither the Comptroller nor any Assistant
Comptroller may occupy any other office. With the above exceptions, any two
offices may be occupied and the duties thereof may be performed by one person.
22. The salary and other compensation of the chief executive officer of
the Corporation shall be determined from time to time by the Board of Directors.
The salaries and other compensation of all other officers of the Corporation
shall be determined from time to time by the chief executive officer, subject to
the concurrence of the Chairman.
23. The salary or other compensation of all employees other than officers
of the Corporation 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.
24. 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, and perform such duties as shall be
determined from time to time by the Board of Directors.
25. The officers of the Corporation shall hold office until the first
meeting of the Board of Directors after the next succeeding annual meeting of
stockholders and until their respective successors are chosen and qualify. Any
officer elected pursuant to Section 21 of the By-Laws may be removed at
7
<PAGE>
any time, with or without cause, by the vote of a majority of the directors 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, 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
------------
26. (a) If a Chairman shall be chosen by the Board of Directors, he
shall preside at all meetings of the Board at which he shall be present.
(b) If a Chairman shall be chosen by the Board of Directors and if
he shall be designated by the Board as chief executive officer of the
Corporation:
(i) he 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) he 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) he may, unless otherwise directed by the Board of Directors
pursuant to Section 36 of the By-Laws, attend in person or by
substitute or proxy appointed by him and act and vote on behalf of
the Corporation at all meetings of stockholders of any corporation
in which the Corporation holds stock and grant any consent,
waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
8
<PAGE>
(v) he 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 if
he shall not be designated by the Board as chief executive
officer of the Corporation
(i) he 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;
(ii) he 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
-------------
27. (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 he shall be
present.
(b) If the President shall be designated by the Board of Directors
as chief executive officer of the Corporation:
(i) he 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) he 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
9
<PAGE>
other instruments of any nature pertaining to the business of the
Corporation;
(iii) he may, unless otherwise directed by the Board of
Directors pursuant to Section 36 of the By-Laws, attend in person
or by substitute or proxy appointed by him and act and vote on
behalf of the Corporation at all meetings of the stockholders of
any corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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
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
10
<PAGE>
Section 36 of the By-Laws, attend in person or by substitute or
proxy appointed by him and act and vote on behalf of the
Corporation at all meetings of the stockholders 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 his opinion 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
--------------
28. (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 27(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 Directors and the Executive Committee, if there be one.
(b) He 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, 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) He 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 27(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 Subsections 27(b)(iii)
and 27(c)(iv) of the By-Laws, unless otherwise directed by the Board of
Directors pursuant to Section 36 of the By-Laws, attend in person or by
substitute or proxy appointed by him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which the
Corporation holds
11
<PAGE>
stock and grant any consent, waiver or power of attorney in respect of such
stock.
(d) He 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
or a Senior 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 27(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
-------------
29. (a) The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record all votes and the
minutes of all proceedings in books to be kept for that purpose; and he shall
perform like duties for the Executive Committee and any other committees created
by the Board of Directors.
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which notice
is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He shall be the custodian of the seal of the Corporation and,
pursuant to Section 43 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.
12
<PAGE>
(f) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, and shall exercise such other
powers and duties as may be prescribed by the Board of Directors.
The Treasurer
-------------
30. (a) The Treasurer shall be responsible for the safekeeping of the
corporate funds and securities of the Corporation, and shall maintain and keep
in his custody 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) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation, retirement
or removal from office, of all books, papers,
13
<PAGE>
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
-----------
31. (a) If and when elected by the Board of Directors, 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 his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the Board or any
director of the Corporation, and shall render a full financial report at the
annual meeting of the stockholders, if called upon to do so.
14
<PAGE>
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other powers and duties as may be conferred or required 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.
Vacancies
---------
32. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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
------------
33. Any 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 acceptance, unless some
time be fixed in the resignation, and then from that time. Nothing herein shall
be
15
<PAGE>
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
-----------------------------------
34. 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 the total number of directors provided for
in Section 9 of the By-Laws may, notwithstanding any 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
----------------------------------------------------
35. (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 office under the
General Corporation Law of the State of Delaware, 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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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 to the fullest extent permitted by law.
(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
16
<PAGE>
person to repay such amount if it shall ultimately be determined that he 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
any 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 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
shareholder, or disinterested directors or otherwise, both as to action in an
official capacity and as to action in any other
17
<PAGE>
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
---------------------------
36. 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
stockholders 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.
Certificate of Stock
--------------------
37. 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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
-----------------
38. 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
---------------------
39. The Board of Directors is hereby authorized to fix a time, not
exceeding fifty (50) days preceding the date of any meeting of stockholders or
the date fixed for the payment of any dividend or the making of any
distribution, or for the delivery
18
<PAGE>
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 stockholders 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 stockholders of record at such time shall be entitled to
receive any such notice, dividend, distribution, rights or interests.
Registered Stockholders
-----------------------
40. The Corporation shall be entitled to treat the holder of record 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 State of
Delaware.
Lost Certificates
-----------------
41. 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
-------------------
42. The Board of Directors may determine whether and to what extent, and
at what time the 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 stockholders), or any of them, shall be open to the
inspection of stockholders, and no stockholder 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 State of Delaware or by the By-Laws or by
resolution of the Board of Directors or of the stockholders.
19
<PAGE>
Checks, Notes, Bonds and Other Instruments
------------------------------------------
43. (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 of
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.
44. 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 Chairman or 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 Chairman or the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or
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 facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
20
<PAGE>
Receipts for Securities
-----------------------
45. All receipts for stocks, bonds or other securities received 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
-----------
46. The fiscal year shall begin the first day of January in each year.
Dividends
---------
47. (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 to 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 interest of the Corporation.
Notices
-------
48. (a) Whenever under the provisions of the By-Laws notice is required
to be given to any director, officer of stockholder, it shall not be construed
to require personal notice, but, except as otherwise specifically provided, such
notice may be given in writing, by mail, by depositing a copy of the same in a
post office, letter box or mail chute, maintained by the United States Postal
Service, postage prepaid, addressed to such stockholder, officer or director, at
his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
21
<PAGE>
Participation in Meetings by Telephone
--------------------------------------
49. At any meeting of the Board of Directors or the Executive Committee
or any other committee designated by the Board of Directors, one or more
directors may participate in such meeting in lieu of attendance in person by
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.
Amendments
----------
50. 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 stockholders duly held. The By-Laws may also be altered or
amended by the affirmative vote of a majority of the directors in office at a
meeting of the Board of Directors.
22
<PAGE>
Exhibit B-211
CERTIFICATE OF INCORPORATION
OF
GPU ARGENTINA HOLDINGS, INC.
----------------------------
The undersigned, a natural person, for the purpose of organizing a
corporation for conducting the business and promoting the purposes hereinafter
stated, upon the provisions and subject to the requirements of the laws of the
State of Delaware (particularly, Chapter 2, Title 8 of the Delaware Code and the
acts amendatory thereof and supplemental thereto, and known, identified and
referred to as the "General Corporation Law of the State of Delaware"), hereby
certifies that:
FIRST: The name of the corporation (hereinafter referred to as the
-----
"Corporation") is GPU ARGENTINA HOLDINGS, INC.
SECOND: The address, including street, number, city and county, of the
------
registered office of the Corporation in the State of Delaware is: CORPORATION
TRUST CENTER, 1209 ORANGE STREET, CITY OF WILMINGTON, COUNTY OF NEW CASTLE: and
the name of the registered agent of the Corporation in the State of Delaware at
such address is THE CORPORATION TRUST COMPANY.
THIRD: The purpose of the corporation is to conduct any lawful business,
-----
to promote any lawful purpose and to engage in any lawful act or activity for
which corporations may be organized under the General Corporation Law of the
State of Delaware.
FOURTH: The total number of shares of stock which the corporation shall
------
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
-----
follows:
NAME MAILING ADDRESS
---- ---------------
James L. Howard c/o GPU International, Inc.
One Upper Pond Road
Parsippany, NJ 07054
1
<PAGE>
SIXTH: The board of directors of the corporation is expressly authorized
-----
to adopt, amend or repeal by-laws of the corporation.
SEVENTH: The personal liability of the directors of the corporation is
-------
hereby eliminated to the fullest extent permitted by the provisions of paragraph
(7) of subsection (b) of Section 102 of the General Corporation Law of the State
of Delaware, as the same may be amended and supplemented.
EIGHTH: Elections of Directors need not be by written ballot except and to
------
the extent provided in the By-Laws of the Corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this 18th day of December,
1998.
_______________________
____________________
James L. Howard
Sole Incorporator
2
<PAGE>
Exhibit B-212
________________________________________________________________________________
________________________________________________________________________________
___________________________________________________________
GPU ARGENTINA HOLDINGS, INC.
By-Laws
___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
<PAGE>
BY-LAWS
1. The principal office of GPU ARGENTINA HOLDINGS, INC. (the
"Corporation") shall be in Parsippany, New Jersey. 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
"Delaware". 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders 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 stockholders 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 stockholders 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 stockholders
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.
1
<PAGE>
5. Except as otherwise provided by law or by the Certificate of
Incorporation, 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 stockholders. 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
stockholders 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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholders or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. At all elections of directors each
holder of record of shares of capital stock then entitled to vote, shall be
entitled to as many votes as shall equal the number of votes which (except for
such provision) he would be entitled to cast for the election of directors with
respect to his shares of stock multiplied by the number of directors to be
elected and he may cast all such votes for a single director or may distribute
them among the number to be voted for, or any two or more of them, as he may see
fit. Except as otherwise provided by law or by the Certificate of
Incorporation, each holder of record of shares of capital stock entitled to vote
at any meeting of stockholders shall be entitled to one vote for every share of
capital stock standing in his name on the books of the Corporation. 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 thereof, shall not be voted.
All elections shall be determined by a plurality vote, and, except as otherwise
provided by law or by the Certificate of Incorporation 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.
7. A complete list of the stockholders entitled to vote at any meeting
of stockholders, arranged in alphabetical order, with
2
<PAGE>
the residence of each, and the number of shares held by each, shall 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
stockholder 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 stockholder.
8. Special meetings of the stockholders for any purpose or purposes,
unless otherwise prescribed by law, may be called by the Chairman or by the
President, and shall be called by the chief executive officer or Secretary at
the request in writing of any three members of the Board of Directors, or at the
request in writing of holders of record of ten percent of the shares of capital
stock of the Corporation issued and outstanding. Business transacted at all
special meetings of the stockholders shall be confined to the purposes stated in
the call.
9. (a) Notice of every meeting of stockholders, setting forth the time
and the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more than fifty days prior to such meeting, to each
stockholder of record (at his address appearing on the stock books of the
Corporation, unless he shall have filed with the Secretary of the Corporation a
written request that notices intended for him 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, the Certificate of Incorporation or 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 Certificate 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 by its
Board of Directors, which shall consist of not less than one nor more than nine
directors as shall be fixed from time to time by a resolution adopted by a
majority of the entire Board of Directors; provided, however, that no decrease
in the number of
3
<PAGE>
directors constituting the entire Board of Directors shall shorten the term of
any incumbent director. Each director shall be at least twenty-one years of
age. Directors need not be stockholders of the Corporation. Directors shall be
elected at the annual meeting of stockholders, or, if any such election shall
not be held, at a stockholders' meeting called and held in accordance with the
provisions of the General Corporation Law of the State of Delaware. Each
director shall serve until the next annual meeting of stockholders and
thereafter until his 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
Certificate of Incorporation, or by the By-Laws directed or required to be
exercised or done by the stockholders.
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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and
the Board in good faith authorizes the contract or transaction by a
vote sufficient for such purposes without counting the vote of the
interested director or directors; or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to
vote thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; 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 stockholders.
No director or officer shall be liable to account to the Corporation for
any profit realized by him from or through any such contract or transaction of
the Corporation by reason of his
4
<PAGE>
interest 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 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 purposes 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 stockholders. 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 his duties shall give notice
5
<PAGE>
either personally or by telephone or telegraph 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 a majority of the directors
in office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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, as amended, or by the By-Laws.
17. 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 except such powers as the Board of Directors
may exercise by virtue of Section 11 of the By-Laws. The Executive Committee
shall have no power to revoke any action taken by the Board of Directors, and
shall be subject to any restriction imposed by law, by the By-Laws, or by the
Board of Directors.
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, and 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 of 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
6
<PAGE>
majority of the total number of directors provided for in Section 10 of the By-
Laws fill any 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.
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 and benefits for their services as
directors, at such rate or under such conditions 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 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 the Executive Committee or such other Committees
of the Board and of otherwise performing their duties as members of such
Committees.
OFFICERS
--------
23. The officers of the Corporation shall be chosen by a vote of a
majority of the directors in office and shall be a President, one or more Vice
Presidents, a Treasurer, a Secretary, and a Comptroller, and may include a
Chairman, 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
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
7
<PAGE>
need be a director. Neither the Comptroller nor any Assistant Comptroller may
occupy any other office. With the above exceptions, any two offices may be
occupied and the duties thereof may be performed by one person, but no officer
shall execute, acknowledge or verify any instrument in more than one capacity.
24. The salary and other compensation of the chief executive officer of
the Corporation shall be determined from time to time by the Board of Directors.
The salaries and other compensation of all other officers of the Corporation
shall be determined from time to time by the chief executive officer, subject to
the concurrence of the Chairman.
25. The salary or other compensation of all employees other than officers
of the Corporation 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.
26. 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, and perform such duties as shall be
determined from time to time 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
stockholders 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 the directors 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, 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, he
shall preside at all meetings of the Board at which he shall be present.
(b) If a Chairman shall be chosen by the Board of Directors and if he
shall be designated by the Board as chief executive officer of the Corporation:
8
<PAGE>
(i) he 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) he 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 Corporations;
(iii) he 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 him and act and vote on
behalf of the Corporation at all meetings of stockholders of any
corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of
the Corporation whose duties are not otherwise defined; and
(v) he 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 if he
shall not be designated by the Board as chief executive officer of the
Corporation.
(i) he 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;
9
<PAGE>
(ii) he 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 he shall be
present.
(b) If the President shall be designated by the Board of Directors as
chief executive officer of the Corporation.
(i) he 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) he 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) he 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders of
any corporation in which the Corporation holds stock and grant
any consent, waiver, or power of attorney in respect of such
stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of
the Corporation whose duties are not otherwise defined; and
(v) he 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.
10
<PAGE>
(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 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 him and act and vote on
behalf of the Corporation at all meetings of the stockholders 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 his opinion 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.
11
<PAGE>
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 Directors and the Executive Committee, if there be one.
(b) He 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, 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) He 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 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 him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which the
Corporation holds stock and grant any consent, waiver or power of attorney in
respect of such stock.
(d) He 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
or a Senior 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.
12
<PAGE>
THE SECRETARY
-------------
31. (a) The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record all votes and the
minutes of all proceedings in books to be kept for that purpose; and he shall
perform like duties for the Executive Committee and any other committees created
by the Board of Directors.
(b) He shall give, or cause to be given, notice of all meetings of
the stockholders, the Board of Directors, or the Executive Committee of which
notice is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He 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) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
in his custody full and accurate accounts of receipts and disbursements in books
belonging to the Corporation, and shall deposit all moneys and other funds of
13
<PAGE>
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) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other property
of whatever kind in his possession or under his control belonging to the
Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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.
14
<PAGE>
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 his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the Board or any
director of the Corporation, and shall render a full financial report at the
annual meeting of the stockholders, if called upon to do so.
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other powers and duties as may be conferred or required by the Board of
Directors.
15
<PAGE>
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.
VACANCIES
---------
34. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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. Any 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 acceptance, 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 the total number of directors provided for
in Section 10 of the By-Laws may, notwithstanding any 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 office under the
General Corporation Law of the State of Delaware, and the breach or failure to
perform
16
<PAGE>
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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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.
(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 he 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 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 any employee benefit plan in the performance of
duties for a purpose reasonably believed to be in the interest of the
17
<PAGE>
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 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
shareholder, or disinterested directors or otherwise, both as to action in an
official capacity and as to action 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
stockholders 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.
18
<PAGE>
CERTIFICATE 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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 stockholders 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 stockholders 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 stockholders of
record at such time shall be entitled to receive any such notice, dividend,
distribution, rights or interests.
REGISTERED STOCKHOLDERS
-----------------------
42. The Corporation shall be entitled to treat the holder of record 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
19
<PAGE>
of any other person, whether or not it shall have express or other notice
thereof, save as expressly provided by statutes of the State of Delaware.
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
-------------------
44. The Board of Directors may determine whether and to what extent, and
at what time the 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 stockholders), or any of them, shall be open to the
inspection of stockholders, and no stockholder 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 state of Delaware or by the By-Laws or by
resolution of the Board of Directors or of the stockholders.
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 of
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.
20
<PAGE>
(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 Chairman or 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 Chairman or the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or
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 facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
RECEIPTS FOR SECURITIES
-----------------------
46. All receipts for stocks, bonds or other securities received 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.
21
<PAGE>
(b) The Board of Directors shall have power to fix and determine, and
from time to time to 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 interest of the Corporation.
DIRECTORS' ANNUAL STATEMENT
---------------------------
49. The Board of Directors shall present or cause to be presented at each
annual meeting of stockholders, and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
NOTICES
-------
50. (a) Whenever under the provisions of the By-Laws notice is
required to be given to any director, officer of stockholder, it shall not be
construed to require personal notice, but, except as otherwise specifically
provided, such notice may be given in writing, by mail, by depositing a copy of
the same in a post office, letter box or mail chute, maintained by the United
States Postal Service, postage prepaid, addressed to such stockholder, officer
or director, at his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any notice
required to be given to him by law or by the By-Laws.
PARTICIPATION IN MEETINGS BY TELEPHONE
--------------------------------------
51. At any meeting of the Board of Directors or the Executive
Committee or any other committee designated by the Board of Directors, one or
more directors may participate in such meeting in lieu of attendance in person
by 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.
22
<PAGE>
OATH OF JUDGES OF ELECTION
--------------------------
52. The judges of election appointed to act at any meeting of the
stockholders 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
----------
53. 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 stockholders 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 the
directors 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
stockholders 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.
23
<PAGE>
Exhibit B-213
CERTIFICATE OF INCORPORATION
OF
GPU SOLAR, INC.
----------------------------
It is hereby certified that:
FIRST: The name of the corporation (hereinafter called the "Corporation")
-----
is GPU Solar, Inc.
SECOND: The address, including street, number, city and county, of the
------
registered office of the Corporation in the State of New Jersey is One Upper
Pond Road, Parsippany, County of Morris; and the name of the registered agent of
the corporation in the State of New Jersey at such address is Bruce L. Levy.
THIRD: The purpose of the corporation is to engage in any lawful act or
-----
activity for which corporations may be organized under the New Jersey Business
Corporation Act.
FOURTH: The total number of shares of stock which the corporation shall
------
have authority to issue is one hundred (100) shares, all of which are without
par value. All such shares are of one class and are shares of Common Stock.
FIFTH: The name and the mailing address of the incorporator are as
-----
follows:
NAME MAILING ADDRESS
---- ---------------
James L. Howard c/o GPU International, Inc.
One Upper Pond Road
Parsippany, NJ 07054
SIXTH: The Corporation is to have perpetual existence.
------
SEVENTH: The board of directors of the corporation is expressly authorized
-------
to adopt, amend or repeal by-laws of the corporation.
EIGHTH: The personal liability of the directors of the corporation is
------
hereby eliminated to the fullest extent permitted by the New Jersey Business
Corporation Act, as the same may be amended and supplemented.
1
<PAGE>
NINTH: As of the date hereof, the corporation has received no payment for
-----
any of its stock.
IN WITNESS WHEREOF, I have hereunto set my hand this 5th day of November,
1997.
______________________________
________________________
James L. Howard
Sole Incorporator
2
<PAGE>
Exhibit B-214
________________________________________________________________________________
________________________________________________________________________________
________________________
GPU SOLAR, INC.
By-Laws
________________________
________________________________________________________________________________
________________________________________________________________________________
<PAGE>
BY-LAWS
1. The principal office of GPU BRASIL, INC. (the "Corporation") shall be
in Parsippany, New Jersey. 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
"New Jersey". 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.
STOCKHOLDERS' MEETINGS
----------------------
3. All meetings of stockholders 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 stockholders 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 stockholders 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 stockholders 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 stockholders
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.
1
<PAGE>
5. Except as otherwise provided by law or by the Certificate of
Incorporation, 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 stockholders. 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
stockholders 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 stockholders each holder of record of shares of
capital stock then entitled to vote shall be entitled to vote in person, or by
proxy appointed by instrument executed in writing by such stockholders or by his
duly authorized attorney; but no proxy shall be valid after the expiration of
eleven months from the date of its execution unless the stockholder executing it
shall have specified therein the length of time it is to continue in force,
which shall be for some specified period. At all elections of directors each
holder of record of shares of capital stock then entitled to vote, shall be
entitled to as many votes as shall equal the number of votes which (except for
such provision) he would be entitled to cast for the election of directors with
respect to his shares of stock multiplied by the number of directors to be
elected and he may cast all such votes for a single director or may distribute
them among the number to be voted for, or any two or more of them, as he may see
fit. Except as otherwise provided by law or by the Certificate of
Incorporation, each holder of record of shares of capital stock entitled to vote
at any meeting of stockholders shall be entitled to one vote for every share of
capital stock standing in his name on the books of the Corporation. 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 thereof, shall not be voted.
All elections shall be determined by a plurality vote, and, except as otherwise
provided by law or by the Certificate of Incorporation 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.
2
<PAGE>
7. A complete list of the stockholders entitled to vote at any meeting
of stockholders, arranged in alphabetical order, with the residence of each, and
the number of shares held by each, shall 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 stockholder 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 stockholder.
8. Special meetings of the stockholders for any purpose or purposes,
unless otherwise prescribed by law, may be called by the Chairman or by the
President, and shall be called by the chief executive officer or Secretary at
the request in writing of any three members of the Board of Directors, or at the
request in writing of holders of record of ten percent of the shares of capital
stock of the Corporation issued and outstanding. Business transacted at all
special meetings of the stockholders shall be confined to the purposes stated in
the call.
9. (a) Notice of every meeting of stockholders, setting forth the time
and the place and briefly the purpose or purposes thereof, shall be mailed, not
less than ten nor more than fifty days prior to such meeting, to each
stockholder of record (at his address appearing on the stock books of the
Corporation, unless he shall have filed with the Secretary of the Corporation a
written request that notices intended for him 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, the Certificate of Incorporation or 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 stockholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, the meeting and vote of stockholders may be dispensed with, if
all the stockholders who would have been entitled to vote upon the action if
such meeting were held, shall consent in writing 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 Certificate 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 by its
Board of Directors, which shall consist of not less
3
<PAGE>
than one nor more than nine directors as shall be fixed from time to time by a
resolution adopted by a majority of the entire Board of Directors; provided,
however, that no decrease in the number of directors constituting the entire
Board of Directors shall shorten the term of any incumbent director. Each
director shall be at least twenty-one years of age. Directors need not be
stockholders of the Corporation. Directors shall be elected at the annual
meeting of stockholders, or, if any such election shall not be held, at a
stockholders' meeting called and held in accordance with the provisions of the
New Jersey Business Corporation Act. Each director shall serve until the next
annual meeting of stockholders and thereafter until his 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
Certificate of Incorporation, or by the By-Laws directed or required to be
exercised or done by the stockholders.
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 corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for such reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors which
authorize the contract or transaction, or solely because his votes are counted
for such purpose if:
(a) The material facts as to his interest and as to the contract or
transaction are disclosed or are known to the Board of Directors, and
the Board in good faith authorizes the contract or transaction by a
vote sufficient for such purposes without counting the vote of the
interested director or directors; or
(b) The material facts as to his interest and as to the contract or
transaction are disclosed or known to the stockholders entitled to
vote thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; 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 stockholders.
4
<PAGE>
No director or officer shall be liable to account to the Corporation
for any profit realized by him from or through any such contract or transaction
of the Corporation by reason of his interest 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 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 purposes 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 stockholders. 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
5
<PAGE>
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 his duties shall give notice either personally or by telephone or
telegraph 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 a majority of the directors
in office shall be requisite for, and shall constitute, a quorum for the
transaction of business, and the act of a majority of the directors present 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, as amended, or by the By-Laws.
17. 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 except such powers as the Board of Directors
may exercise by virtue of Section 11 of the By-Laws. The Executive Committee
shall have no power to revoke any action taken by the Board of Directors, and
shall be subject to any restriction imposed by law, by the By-Laws, or by the
Board of Directors.
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, and 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 of alteration,
third
6
<PAGE>
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 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.
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 and benefits for their services as
directors, at such rate or under such conditions 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 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 the Executive Committee or such other Committees
of the Board and of otherwise performing their duties as members of such
Committees.
Officers
--------
23. The officers of the Corporation shall be chosen by a vote of a
majority of the directors in office and shall be a President, one or more Vice
Presidents, a Treasurer, a Secretary, and a Comptroller, and may include a
Chairman, 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
7
<PAGE>
executive officer of the Corporation. The Chairman 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. Neither the
Comptroller nor any Assistant Comptroller may occupy any other office. With the
above exceptions, any two offices may be occupied and the duties thereof may be
performed by one person, but no officer shall execute, acknowledge or verify any
instrument in more than one capacity.
24. The salary and other compensation of the chief executive officer of
the Corporation shall be determined from time to time by the Board of Directors.
The salaries and other compensation of all other officers of the Corporation
shall be determined from time to time by the chief executive officer, subject to
the concurrence of the Chairman.
25. The salary or other compensation of all employees other than officers
of the Corporation 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.
26. 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, and perform such duties as shall be
determined from time to time 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
stockholders 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 the directors 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, 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, he
shall preside at all meetings of the Board at which he shall be present.
8
<PAGE>
(b) If a Chairman shall be chosen by the Board of Directors and if he
shall be designated by the Board as chief executive officer of the Corporation:
(i) he 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) he 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
Corporations;
(iii) he 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 him and act and vote on behalf of
the Corporation at all meetings of stockholders of any corporation
in which the Corporation holds stock and grant any consent,
waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
(v) he 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 if he
shall not be designated by the Board as chief executive officer of the
Corporation.
(i) he 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
9
<PAGE>
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;
(ii) he 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 he shall be
present.
(b) If the President shall be designated by the Board of Directors as
chief executive officer of the Corporation.
(i) he 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) he 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) he 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 him and act and vote on behalf of
the Corporation at all meetings of the stockholders of any
corporation in which the Corporation holds stock and grant any
consent, waiver, or power of attorney in respect of such stock;
(iv) he shall, whenever it may in his opinion be necessary or
appropriate, prescribe the duties of officers and employees of the
Corporation whose duties are not otherwise defined; and
10
<PAGE>
(v) he 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
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 him and act and vote on behalf of
the Corporation at all meetings of the stockholders 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 his opinion 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.
11
<PAGE>
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 Directors and the Executive Committee, if there be one.
(b) He 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, 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) He 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 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 him and act and vote on behalf of the
Corporation at all meetings of the stockholders of any corporation in which the
Corporation holds stock and grant any consent, waiver or power of attorney in
respect of such stock.
(d) He 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
or a Senior 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.
12
<PAGE>
The Secretary
-------------
31. (a) The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record all votes and the
minutes of all proceedings in books to be kept for that purpose; and he shall
perform like duties for the Executive Committee and any other committees created
by the Board of Directors.
(b) He shall give, or cause to be given, notice of all meetings of the
stockholders, the Board of Directors, or the Executive Committee of which notice
is required to be given by law or by the By-Laws.
(c) He 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 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 his death,
resignation, retirement or removal from office.
(e) He 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) He shall have control of the stock ledger, stock certificate book
and all books containing minutes of any meeting of the stockholders, Board of
Directors, or 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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
13
<PAGE>
Corporation, and shall maintain and keep in his custody 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) He 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, he may, when authorized by
the Board of Directors, affix the seal to all instruments requiring it and shall
attest the ensealing and execution of said instruments.
(d) He shall exhibit at all reasonable times his 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) He shall render an account of all his 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, he 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 his office, and for
the restoration to the Corporation in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other property
of whatever kind in his possession or under his control belonging to the
Corporation.
(g) He shall perform all duties generally incident to the office of
Treasurer, and shall have other powers 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 his duties, shall exercise his powers and duties
at his request or in his absence or disability, 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.
14
<PAGE>
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 his office.
(b) He 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) He 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) He shall exhibit at all reasonable times his 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) He 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 he may be requested by the Board or any
director of the Corporation, and shall render a full financial report at the
annual meeting of the stockholders, if called upon to do so.
(f) He shall receive and keep in his custody an original copy of each
written contract made by or on behalf of the Corporation.
(g) He shall receive periodic reports from the Treasurer of the
Corporation of all receipts and disbursements, and shall see that correct
vouchers are taken for all disbursements for any purpose.
(h) He 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 his duties, shall exercise his powers and
duties at his request or in his absence or disability and shall exercise such
other powers and
15
<PAGE>
duties as may be conferred or required 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.
Vacancies
---------
34. If the office of any director becomes vacant by reason of death,
resignation, retirement, disqualification, or otherwise, the remaining
directors, by the vote of a majority of those then in office 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 occurs. 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. Any 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 acceptance, 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 the total number of directors provided for
in Section 10 of the By-Laws may, notwithstanding any 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 office under the
New Jersey Business
16
<PAGE>
Corporation Act, 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 formal or informal, and whether brought by or in the
right of the Corporation or otherwise, by reason of the fact that he 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.
(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 he 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 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 any employee benefit plan in the performance of
duties
17
<PAGE>
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 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
shareholder, or disinterested directors or otherwise, both as to action in an
official capacity and as to action 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
stockholders 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.
18
<PAGE>
Certificate 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 his address. No
fractional shares of stock shall be issued. Certificates of stock shall be
signed by the Chairman, 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. Where any certificate of stock is
signed by a transfer agent or transfer clerk, who may be but need not be an
officer or employee of the Corporation, and by a registrar, the signature of any
such Chairman, President, Vice President, Secretary, Assistant Secretary,
Treasurer, or Assistant Treasurer upon such certificate who shall have ceased to
be such before such certificate 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 stockholders 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 stockholders 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 stockholders of
record at such time shall be entitled to receive any such notice, dividend,
distribution, rights or interests.
Registered Stockholders
-----------------------
42. The Corporation shall be entitled to treat the holder of record 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
19
<PAGE>
of any other person, whether or not it shall have express or other notice
thereof, save as expressly provided by statutes of the State of New Jersey.
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
-------------------
44. The Board of Directors may determine whether and to what extent, and
at what time the 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 stockholders), or any of them, shall be open to the
inspection of stockholders, and no stockholder 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 state of New Jersey or by the By-Laws or by
resolution of the Board of Directors or of the stockholders.
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 of
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.
20
<PAGE>
(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 Chairman or 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 Chairman or the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or
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 facsimile signature appears thereon, had not ceased to be such
officer of the Corporation.
Receipts for Securities
-----------------------
46. All receipts for stocks, bonds or other securities received 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.
21
<PAGE>
(b) The Board of Directors shall have power to fix and determine, and
from time to time to 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 interest of the Corporation.
Directors' Annual Statement
---------------------------
49. The Board of Directors shall present or cause to be presented at each
annual meeting of stockholders, and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
Notices
-------
50. (a) Whenever under the provisions of the By-Laws notice is required
to be given to any director, officer of stockholder, it shall not be construed
to require personal notice, but, except as otherwise specifically provided, such
notice may be given in writing, by mail, by depositing a copy of the same in a
post office, letter box or mail chute, maintained by the United States Postal
Service, postage prepaid, addressed to such stockholder, officer or director, at
his address as the same appears on the books of the Corporation.
(b) A stockholder, director or officer may waive in writing any
notice required to be given to him by law or by the By-Laws.
Participation in Meetings by Telephone
--------------------------------------
51. At any meeting of the Board of Directors or the Executive Committee
or any other committee designated by the Board of Directors, one or more
directors may participate in such meeting in lieu of attendance in person by
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.
22
<PAGE>
Oath of Judges of Election
--------------------------
52. The judges of election appointed to act at any meeting of the
stockholders 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
----------
53. 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 stockholders 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 the directors 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
stockholders 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.
23
<PAGE>
EXHIBIT B-215
CERTIFICATE OF MERGER OF
GPU SOLAR, L.L.C. AND GPU SOLAR, INC.
To the Secretary of State
State of New Jersey
Pursuant to the provisions of Section 42:2B-20 of the New Jersey
Limited Liability Company Act and Section 14A:10-4.1 of the New Jersey Business
Corporation Act, it is hereby certified that:
1. The names of the merging entities are GPU Solar, Inc., which is a
corporation of the State of New Jersey, and GPU Solar, L.L.C., which is a
limited liability company of the State of New Jersey.
2. GPU Solar, Inc. will continue its existence as the surviving
corporation under its present name pursuant to the provisions of the New Jersey
Business Corporation Act.
3. Annexed hereto and made a part hereof is the plan for merging GPU
Solar, L.L.C. with and into GPU Solar, Inc. (the "Plan of Merger") as approved
by the directors and the shareholders entitled to vote of GPU Solar, Inc. and by
the managers and the members entitled to vote of GPU Solar, L.L.C. and as
executed by GPU Solar, Inc. and GPU Solar L.L.C. on January 7, 1998.
4. The number of shares of GPU Solar, Inc. which were entitled to
vote at the time of the approval of the Plan of Merger by its shareholders is
100, all of which are of one class. All of the shareholders entitled to vote of
the aforesaid corporation approved the Plan of Merger pursuant to their written
consents without a meeting of shareholders, and the number of shares represented
by such consents is 100. The date of said consents and approval was January 7,
1998.
5. The number of members of GPU Solar, L.L.C. which were entitled to
vote at the time of the approval of the Plan of Merger is two. Both of the
members entitled to vote of the aforesaid limited liability company approved the
Plan of Merger pursuant to their written consents. The date of said consents
and approval was January 7, 1998.
<PAGE>
6. The merger shall be effective upon the filing of this certificate
of merger.
7. The Plan of Merger is on file at GPU Solar, Inc., One Upper Pond
Road, Parsippany, New Jersey 07054.
8. A copy of the Plan of Merger shall be furnished by GPU Solar,
Inc., on request and without cost, to any member of any domestic limited
liability company or any person holding an interest in any other business entity
which is to merge or consolidate.
Executed on January 7, 1998
By:___________________________________
Name: James R. Torpey, Jr.
Title: President of GPU Solar, Inc.
By: __________________________________
Name: James R. Torpey, Jr.
Title: Manager of GPU Solar, L.L.C.
2
<PAGE>
EXHIBIT C-5
INCENTIVE COMPENSATION PLAN FOR ELECTED OFFICERS OF
GPU SERVICE, INC.
(AS AMENDED AND RESTATED JUNE 4, 1998)
1. Purpose.
-------
The purpose of the Incentive Compensation Plan for Elected Officers of
GPU Service, Inc. (the "Plan") is to attract and retain highly qualified
employees, to obtain from each the best possible performance, and to underscore
the importance to them of achieving particular business objectives established
for GPU Service, Inc. and its affiliates.
2. Definitions.
-----------
For the purposes of the Plan, the following terms shall have the
following meanings:
A. Awards. Incentive Compensation Awards made pursuant to the Plan.
------
B. Board. The Board of Directors of GPU, Inc. unless otherwise
-----
specified.
C. Change in Control. A "Change in Control" shall mean the occurrence
-----------------
of:
(1) An acquisition (other than directly from the Corporation) of any
common stock of the Corporation ("Common Stock") or other voting
securities of the Corporation entitled to vote generally for the
election of directors (the "Voting Securities") by any "Person" (as
the term person is used for purposes of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), immediately after which such Person has "Beneficial
Ownership" (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty percent (20%) or more of the then
outstanding shares of Common Stock or the combined voting power of
the Corporation's then outstanding Voting Securities; provided,
--------
however, in determining whether a Change in Control has occurred,
-------
Voting Securities which are acquired in a "Non-Control Acquisition"
(as hereinafter defined) shall not constitute an acquisition which
would cause a Change in Control. A "Non-Control Acquisition" shall
mean an acquisition by (A) an employee benefit plan (or a trust
forming a part thereof) maintained by (i) the Corporation or (ii)
any corporation or other Person of which a majority of its voting
power or its
<PAGE>
voting equity securities or equity interest is owned, directly or
indirectly, by the Corporation (for purposes of this definition, a
"Subsidiary"), (B) the Corporation or its Subsidiaries, or (C) any
Person in connection with a "Non-Control Transaction" (as
hereinafter defined);
(2) The individuals who, as of August 1, 1996, are members of the
Board (the "Incumbent Board"), cease for any reason to constitute at
least seventy percent (70%) of the members of the Board; provided,
--------
however, that if the election, or nomination for election by the
-------
Corporation's shareholders, of any new director was approved by a
vote of at least two-thirds of the Incumbent Board, such new
director shall, for purposes of this Plan, be considered as a member
of the Incumbent Board; provided further, however, that no
-------- ------- -------
individual shall be considered a member of the Incumbent Board if
such individual initially assumed office as a result of either an
actual or threatened "Election Contest" (as described in Rule 14a-11
promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board (a "Proxy Contest") including by reason of any
agreement intended to avoid or settle any Election Contest or Proxy
Contest; or
(3) The consummation of:
(A) A merger, consolidation or reorganization with or into the
Corporation, or in which securities of the Corporation are issued,
unless such merger, consolidation or reorganization is a "Non-
Control Transaction." A "Non-Control Transaction" shall mean a
merger, consolidation or reorganization with or into the Corporation
or in which securities of the Corporation are issued where:
(i) the shareholders of the Corporation, immediately
before such merger, consolidation or reorganization, own directly or
indirectly immediately following such merger, consolidation or
reorganization, at least sixty percent (60%) of the combined voting
power of the outstanding voting securities of the corporation
resulting from such merger or consolidation or reorganization (the
Securities immediately before such merger, consolidation or
reorganization, "Surviving
2
<PAGE>
Corporation") in substantially the same proportion as their
ownership of the Voting
(ii) the individuals who were members of the Incumbent
Board immediately prior to the execution of the agreement providing
for such merger, consolidation or reorganization constitute at least
seventy percent (70%) of the members of the board of directors of
the Surviving Corporation, or a corporation, directly or indirectly,
beneficially owning a majority of the Voting Securities of the
Surviving Corporation, and
(iii) no Person other than (w) the Corporation, (x) any
Subsidiary, (y) any employee benefit plan (or any trust forming a
part thereof) that, immediately prior to such merger, consolidation
or reorganization, was maintained by the Corporation or any
Subsidiary, or (z) any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of twenty
percent (20%) or more of the then outstanding Voting Securities or
common stock of the Corporation, has Beneficial Ownership of twenty
percent (20%) or more of the combined voting power of the Surviving
Corporation's then outstanding voting securities or its common
stock.
(B) A complete liquidation or dissolution of the Corporation;
or
(C) The sale or other disposition of all or substantially all
of the assets of the Corporation to any Person (other than a
transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person (the "Subject Person")
acquired Beneficial Ownership of more than the permitted amount of
the then outstanding Common Stock or Voting Securities as a result
of the acquisition of Common Stock or Voting Securities by the
Corporation which, by reducing the number of shares of Common Stock
or Voting Securities then outstanding, increases the proportional
number of shares Beneficially Owned by the Subject Persons, provided
that if a Change in Control would occur (but for the operation of
this sentence) as a result of the acquisition of shares of Common
Stock or Voting Securities by the Corporation, and after such share
acquisition by the
3
<PAGE>
Corporation, the Subject Person becomes the Beneficial Owner of any
additional shares of Common Stock or Voting Securities which
increases the percentage of the then outstanding shares of Common
Stock or Voting Securities Beneficially Owned by the Subject Person,
then a Change in Control shall occur.
D. Chief Executive Officer. The Chief Executive Officer of the
-----------------------
Company.
E. Committee. The Personnel, Compensation and Nominating Committee of
---------
the Board or any successor thereto.
F. Company. GPU Service, Inc.
-------
G. Corporation. GPU, Inc.
-----------
H. Employee. An individual who was on the active salaried payroll of
--------
the Company or an affiliate of the Company at any time during the
period for which an Award is made.
I. Officer. An Officer of the Company who is elected by the Company's
-------
Board of Directors and is an Employee of the Company, but not
including Assistant Comptrollers, Assistant Secretaries and
Assistant Treasurers.
J. Performance Period. The fiscal year (currently the calendar year)
------------------
for which Awards are made.
3. Effective Date.
--------------
The effective date of the Plan is July 1, 1987.
4. Amounts Available for Awards.
----------------------------
A. The aggregate amount available for Awards for any Performance Period
shall be determined by the Board upon the recommendation of the Committee.
B. No Awards shall be made for a Performance Period if during such
Performance Period no dividends were declared or paid on shares of Common Stock.
4
<PAGE>
5. Eligibility for Awards.
----------------------
A. The Chief Executive Officer shall determine the Officers, if any,
who are eligible for Awards for each Performance Period, subject, in the case of
Officers who are also Officers of the Corporation, to the concurrence of the
Board.
B. The Chief Executive Officer may include, among Officers eligible for
Awards for a Performance Period, Officers whose employment terminated (whether
by reason of retirement, death, disability or other cause) during such
Performance Period.
6. Determination of Amounts of Awards.
----------------------------------
A. The Chief Executive Officer shall determine the amounts of Awards
subject, in the case of Officers who are also Officers of the Corporation, to
the concurrence of the Board, either at or following the end of the Performance
Period to which they relate. The amount of the Awards to be made for any
Performance Period shall be so determined in accordance with the methods and
procedures set forth in the GPU System Officer Incentive Compensation Plan
Administrative Manual as in effect for such Performance Period (the "Manual").
B. Notwithstanding the foregoing or any other provision herein or in
the Manual to the contrary, if a Change in Control occurs, then in respect of
the Performance Period in which the Change in Control occurs (and in respect of
the previous Performance Period if the Change in Control occurs prior to the
time Awards for such Performance Period have been made), the following
provisions shall apply:
(i) each objective of the Company's for each such Performance
Period shall be deemed to have been 100% achieved;
(ii) the Company's Final Pool for each such Performance Period
shall be deemed to be 100% of the Company's Target Pool for each such
Performance Period (or if, as of the date of the Change in Control, the Target
Pool has not been determined for the Performance Period, the Target Pool for the
immediately preceding Performance Period);
(iii) each Officer who, prior to the occurrence of such Change in
Control, was determined to be eligible for an Award for each such Performance
Period ("Eligible Officer") shall be entitled to receive an Award for each such
Performance Period;
5
<PAGE>
(iv) the amount of the Award to be made to each Eligible Officer
shall be determined by multiplying the Company's Final Pool for each such
Performance Period by a fraction the numerator of which is the amount of the
Eligible Officer's annual base salary that was taken into account in determining
the Company's Target Pool for each such Performance Period, and the denominator
of which is the aggregate amount of the Annual Base Salaries of all Eligible
Officers so taken into account; provided, however, that in the event an Eligible
-------- -------
Officer is terminated by the Company without "Cause" (as defined below) during
the Performance Period in which a Change in Control occurs, the amount of the
Award to be made to such Eligible Officer in respect of that Performance Period
shall be the amount determined above multiplied by a fraction, the numerator of
which is the number of days that have elapsed since the end of the immediately
preceding Performance Period through the date of termination and the denominator
of which is 365.
A termination is for Cause if the Eligible Officer is convicted of a felony or
where the Eligible Officer (1) intentionally and continually failed
substantially to perform his or her reasonably assigned duties with the Company
(other than a failure resulting from the Eligible Officer's incapacity due to
physical or mental illness) which failure continued for a period of at least
thirty (30) days after a written notice of demand for substantial performance,
signed by a duly authorized officer, has been delivered to the Eligible Officer
specifying the manner in which he or she has failed substantially to perform, or
(2) intentionally engaged in conduct which is demonstrably and materially
injurious to the Corporation or the Company. No act, nor failure to act, on the
Eligible Officer's part, shall be considered "intentional" unless he or she has
acted, or failed to act, with a lack of good faith and with a lack of reasonable
belief that the Eligible Officer's action or failure to act was in the best
interest of the Corporation and the Company.
7. Form of Awards.
--------------
Awards shall be made in cash.
8. Payment of Awards.
-----------------
Unless it has been deferred pursuant to the GPU System Companies
Deferred Compensation Plan, an Award shall be paid as soon as practicable after
it is made, but in any event by no later than 60 days after the date on which
the Award has been made; provided, however, that if an Eligible Officer is
-------- -------
entitled to a pro-rated Award pursuant to the proviso in Section 6.B(iv), such
pro-rated Award shall be paid within twenty (20) days after the Eligible
Officer's date of termination.
6
<PAGE>
9. Special Awards and Other Plans.
------------------------------
Nothing contained in the Plan shall prohibit the Company from granting
special performance or recognition awards under such conditions, and in such
form and manner as it sees fit, or from establishing other incentive
compensation plans providing for the payment of incentive compensation to
Employees; provided, however, that an Officer who receives an Award under this
Plan shall not receive an award for the same Performance Period under any other
annual incentive plan; provided, further however, that the Company may grant
Awards to Officers under this Plan who have received awards for the same
Performance Period under the GPU, Inc. 1990 Stock Plan for Employees of GPU,
Inc. and Subsidiaries.
10. Amendment and Interpretation of the Plan.
----------------------------------------
A. The Chief Executive Officer shall have the right to amend, modify,
suspend, or terminate the Plan at any time or from time to time, provided that
any amendment to Section 4, Section 6 or this Section 10.A shall be subject to
the concurrence of the Board; provided further, however, that Section 2.C,
Section 6 and this Section 10 may not be amended or modified, and the Plan may
not be suspended or terminated, (i) at the request of a third party who has
indicated an intention or taken steps reasonably calculated to effect a Change
in Control and who effectuates a Change in Control, (ii) within six (6) months
prior to, or otherwise in connection with, or in anticipation of, a Change in
Control which has been threatened or proposed and which actually occurs, or
(iii) following a Change in Control, if the amendment, modification, suspension
or termination adversely affects the rights of any Eligible Officer under the
Plan. No amendment or termination of the Plan shall reduce or otherwise
adversely affect an Award already made hereunder without the consent of the
Officer affected.
B. The Chief Executive Officer is authorized to determine in his
discretion all questions that may arise as to the construction or interpretation
of the Plan, and to resolve any claims that may arise with respect to any
Officer's rights or entitlement to any payment under the Plan. The decision of
the Chief Executive Officer with respect to any such questions or claims shall
be final, conclusive and binding on all parties. Notwithstanding the foregoing,
any decision made by the Chief Executive Officer after the occurrence of a
Change in Control shall be subject to judicial review under a "de novo", rather
than a deferential, standard.
7
<PAGE>
11. Miscellaneous.
-------------
A. All expenses and costs in connection with the operation of the Plan
shall be borne by the Company.
B. All Awards under the Plan are subject to applicable withholding for
federal, state and local taxes.
C. The Participation of any Officer in the Plan may be terminated at
any time. No promise or representation, either express or implied, is made to
any Officer with respect to continued employment, transfer or promotion because
of his or her participation in the Plan.
D. Each Officer who is a participant in the Plan shall have the status
of a general unsecured creditor of the Company with respect to any amounts
payable to the Officer hereunder. The Plan shall constitute a mere promise by
the Company to make payments in the future of the Awards provided for herein. It
is the intention of the Company that the arrangements reflected in this Plan be
treated as unfunded for tax purposes and, if it should be determined that Title
I of ERISA is applicable to such arrangements, for purposes of Title I of ERISA.
E. An Officer's rights to payments under the Plan shall not be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment or garnishment by creditors of the Officer or the
Officer's beneficiary.
8
<PAGE>
EXHIBIT C-8
GPU SERVICE, INC.
EMPLOYEE INCENTIVE COMPENSATION PLAN
(Amending and Restating the former Management Incentive Compensation Plan of GPU
Service Corporation, last amended and restated April 1, 1995. This Amendment and
Restatement is dated December 1, 1998 and is effective beginning with the 1999
Plan Year)
___________________________________
1. Purpose
-------
The purpose of the GPU Service, Inc. Employee Incentive Compensation
Plan (the "Plan") is to attract and retain highly qualified employees, to obtain
from each the best possible performance, and to underscore the importance to
them of achieving particular business goals.
2. Definitions
-----------
For the purposes of the Plan, the following terms shall have the
following meanings:
A. Awards. Incentive Compensation Awards made pursuant to the Plan.
There shall be three classes of Awards -- Class I, Class
II and Class III.
B. Chief Executive Officer. The Chief Executive Officer of the
Company.
C. Company. GPU Service, Inc.
D. Employee. An individual who is on the active, non-bargaining unit
payroll of the Company at any time during the period for
which an Award is made, and who is not eligible for an
Award under the Incentive Compensation Plan for Elected
Officers.
E. Performance Period. The fiscal year (currently calendar) for
which Awards are made.
3. Effective Date
--------------
The effective date of the Plan is January 1, 1989.
4. Amounts Available for Awards
----------------------------
A. The aggregate amount available for Awards for any Performance
Period shall be determined by the Chief Executive Officer.
<PAGE>
B. No Awards shall be made for a Performance Period if during such
Performance Period no dividends were declared or paid on shares of
Common Stock of GPU, Inc.
5. Eligibility for Awards
----------------------
A. The Chief Executive Officer shall determine the Employees, if any,
who are eligible for Awards for each Performance Period. The Chief
Executive Officer shall determine which Employees are eligible to
receive Class I, Class II or Class III Awards.
B. The Chief Executive Officer may include among Employees eligible
for Awards for a Performance Period, Employees whose employment
terminated (whether by reason of retirement, death, disability or
other cause) during such Performance Period.
6. Determination of Amounts of Awards
----------------------------------
The Chief Executive Officer shall determine the amounts of Awards either
at or following the end of the Performance Period to which they relate.
The amount of the Awards to be made for any Performance Period shall be
so determined in accordance with the methods and procedures set forth in
the GPU System Management Incentive Compensation Administrative Manual
------------------------------------------------------------------
or its successor, the GPU Service, Inc. Employee Incentive Compensation
-------------------------------------------------
Plan Administrative Manual for Corporate Employees or the GPU Service,
-------------------------------------------------- ------------
Inc. Employee Incentive Compensation Plan Administrative Manual for
-------------------------------------------------------------------
Operations Employees as in effect for such Performance Period (the
--------------------
"Manual").
7. Form of Awards
--------------
Awards shall be made in cash.
8. Payment of Awards
-----------------
An Award shall be paid as soon as practicable after it is made.
9. Special Awards and Other Plans
------------------------------
Nothing contained in the Plan shall prohibit the Company from granting
special performance or recognition awards under such conditions, and in
such form and manner as it sees fit, or from establishing other
incentive compensation plans providing for the payment of incentive
compensation to Employees.
10. Amendment and Interpretation of the Plan.
----------------------------------------
A. Action to amend the Plan from time to time or to terminate it
entirely or to direct the discontinuance
<PAGE>
of Awards either temporarily or permanently, may be taken by the
Chief Executive Officer. No amendment or termination of the Plan
shall reduce or otherwise affect an Award already made hereunder
without the consent of the Employee affected.
B. The decision of the Chief Executive Officer with respect to any
questions arising in connection with the administration or
interpretation of the Plan shall be final, conclusive and binding.
11. Miscellaneous.
-------------
A. All expenses and costs in connection with the operation of the
Plan shall be borne by the Company.
B. All Awards under the Plan are subject to applicable withholding
for federal, state and local taxes.
C. The Participation of any Employee in the Plan may be terminated at
any time. No promise or representation, either express or implied,
is made to any Employee with respect to continued employment,
transfer or promotion because of his or her participation in the
Plan.
<PAGE>
EXHIBIT C-10
GPU SERVICE, INC.
SUPPLEMENTAL AND EXCESS BENEFITS PLAN
AS AMENDED EFFECTIVE AUGUST 3, 1998
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
----
<S> <C>
Foreword............................................................... 1
Section 1 - Definitions............................................... 3
Section 2 - Application and Basis of the Plan......................... 7
Section 3 - Payment of Benefits....................................... 8
Section 4 - Administration............................................ 15
Section 5 - Amendment and Termination................................. 16
</TABLE>
i
<PAGE>
GPU SERVICE, INC.
SUPPLEMENTAL AND EXCESS BENEFITS PLAN
(As amended effective August 3, 1998)
Foreword
Effective as of January 1, 1988, GPU Service, Inc. (referred to in this document
as the "Company") established a supplemental pension plan for the benefit of
certain of its employees. This GPU Service, Inc. Supplemental and Excess
Benefits Plan (the "Plan") is a continuation of that plan as adopted effective
January 1, 1988.
The Plan, as set forth herein, is applicable to all employees of the Company who
meet the requirements described in this Plan and who are actively employed by
the Company after August 1, 1996. The benefits of any employee who ceased
employment with the Company, by retirement, death, or otherwise, prior to August
1, 1996 are determined in accordance with the terms of the applicable
predecessor to this Plan as in effect at the time of such cessation of
employment, except that the provisions of Section 1.11 are retroactive and apply
to any employee who ceased employment on or after January 1, 1989.
It is intended that the "excess benefits" provided under the Plan be an "excess
benefits plan" as that term is defined in Section 3(36) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), and that the
"supplemental benefits" provided under the Plan be a deferred compensation plan
for "a select group of management or highly compensated employees" as that term
is used in ERISA.
One purpose of the Plan is to provide participants of the GPU Service, Inc.
Employee Pension Plan ("Pension Plan") and their surviving spouses with the
amount of company-provided benefits that would have been provided to them under
the Pension Plan but for the limitation on benefits imposed under Section 415 of
the Internal Revenue Code, as amended.
The second purpose of the Plan is to provide elected officers and certain other
highly compensated employees of the Company and their surviving spouses with the
amount of company-provided benefits that would have been provided to them under
the Pension Plan but for the following:
(a) the limitation on Earnings for purposes of the Pension Plan imposed by
Section 401(a)(17) of such Code, as amended, and
(b) the exclusion, from Earnings under the Pension Plan, of any compensation
deferred under the Deferred Compensation Plan.
1
<PAGE>
The term Company shall include GPU International, Inc and GPU Advanced
Resources, Inc.
Except to the extent otherwise indicated or inappropriate, the Pension Plan is
incorporated by reference.
2
<PAGE>
SECTION 1
Definitions
1.1 Except to the extent otherwise indicated, the definitions contained in
Section 1 of the Pension Plan are applicable under the Plan.
1.2 Board of Directors: The term Board of Directors shall mean the Board of
Directors of the Company.
1.3 Change in Control: The term Change in Control shall mean the occurrence
during the term of the Plan of:
(1) An acquisition (other than directly from GPU, Inc. (the
"Corporation")) of any common stock of the Corporation ("Common Stock") or
other voting securities of the Corporation entitled to vote generally for
the election of directors (the "Voting Securities") by any "Person" (as
the term person is used for purposes of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")),
immediately after which such Person has "Beneficial Ownership" (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of the then outstanding shares of Common Stock or
the combined voting power of the Corporation's then outstanding Voting
Securities; provided, however, in determining whether a Change in Control
-------- -------
has occurred, Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an acquisition
which would cause a Change in Control. A "Non-Control Acquisition" shall
mean an acquisition by (A) an employee benefit plan (or a trust forming a
part thereof) maintained by (i) the Corporation or (ii) any corporation or
other Person of which a majority of its voting power or its voting equity
securities or equity interest is owned, directly or indirectly, by the
Corporation (for purposes of this definition, a "Subsidiary"), (B) the
Corporation or its Subsidiaries, or (C) any Person in connection with a
"Non-Control Transaction" (as hereinafter defined);
(2) The individuals who, as of August 1, 1996, are members of the board of
directors of the Corporation (the "Incumbent Board"), cease for any reason
to constitute at least seventy percent (70%) of the members of the board
of directors of the Corporation; provided, however, that if the election,
-------- -------
or nomination for election by the Corporation's shareholders, of any new
director was approved by a vote of at least two-thirds of the Incumbent
Board, such new director shall, for purposes of this Plan, be considered
as a member of the Incumbent Board; provided further, however, that no
-------- ------- -------
individual shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11
3
<PAGE>
promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the board of directors of the Corporation (a "Proxy Contest") including by
reason of any agreement intended to avoid or settle any Election Contest
or Proxy Contest; or
(3) The consummation of:
(A) A merger, consolidation or reorganization with or into the
Corporation or in which securities of the Corporation are issued, unless
such merger, consolidation or reorganization is a "Non-Control
Transaction." A "Non-Control Transaction" shall mean a merger,
consolidation or reorganization with or into the Corporation or in which
securities of the Corporation are issued where:
(i) the shareholders of the Corporation, immediately before
such merger, consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or reorganization, at
least sixty percent (60%) of the combined voting power of the outstanding
voting securities of the corporation resulting from such merger or
consolidation or reorganization (the "Surviving Corporation") in
substantially the same proportion as their ownership of the Voting
Securities immediately before such merger, consolidation or
reorganization,
(ii) the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing for such
merger, consolidation or reorganization constitute at least seventy
percent (70%) of the members of the board of directors of the Surviving
Corporation, or a corporation, directly or indirectly, beneficially owning
a majority of the Voting Securities of the Surviving Corporation, and
(iii) no Person other than (w) the Corporation, (x) any
Subsidiary, (y) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation or any Subsidiary, or
(z) any Person who, immediately prior to such merger, consolidation or
reorganization had Beneficial Ownership of twenty percent (20%) or more of
the then outstanding Voting Securities or common stock of the Corporation,
has Beneficial Ownership of twenty percent (20%) or more of the combined
voting power of the Surviving Corporation's then outstanding voting
securities or its common stock.
(B) A complete liquidation or dissolution of the Corporation; or
(C) The sale or other disposition of all or substantially all of the
assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
4
<PAGE>
Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because any Person (the "Subject Person") acquired Beneficial
Ownership of more than the permitted amount of the then outstanding Common
Stock or Voting Securities as a result of the acquisition of Common Stock
or Voting Securities by the Corporation which, by reducing the number of
shares of Common Stock or Voting Securities then outstanding, increases
the proportional number of shares Beneficially Owned by the Subject
Persons, provided that if a Change in Control would occur (but for the
operation of this sentence) as a result of the acquisition of shares of
Common Stock or Voting Securities by the Corporation, and after such share
acquisition by the Corporation, the Subject Person becomes the Beneficial
Owner of any additional shares of Common Stock or Voting Securities which
increases the percentage of the then outstanding shares of Common Stock or
Voting Securities Beneficially Owned by the Subject Person, then a Change
in Control shall occur.
1.4 Company: The word Company shall have the meaning indicated in the
Foreword.
1.5 Deferred Compensation Plan: The term Deferred Compensation Plan shall mean
the GPU System Companies Deferred Compensation Plan, as adopted by the
Company.
1.6 Earnings: The term Earnings shall mean an Employee's "Earnings" as defined
in the Pension Plan.
1.7 Excess Benefit: The term Excess Benefit shall mean the excess, if any, of
(i) each pension benefit which would be payable to an Employee or to the
Employee's surviving spouse under the Pension Plan if the limitations on
benefits imposed by Section 18.1 of the Pension Plan were not applicable
over (ii) each pension benefit payable under the Pension Plan.
1.8 Incentive Compensation Plan: The term Incentive Compensation Plan shall
mean the Company's Employee Incentive Compensation Plan or its Incentive
Compensation Plan for Elected Officers or Annual Performance Award Plan.
1.9 Pension Plan: The term Pension Plan shall have the meaning indicated in
the Foreword.
1.10 Plan: The term Plan shall have the meaning indicated in the Foreword.
1.11 Supplemental Benefit: The term Supplemental Benefit shall mean the excess,
if any, of (i) each pension benefit that would be payable to an Employee
or to an Employee's surviving spouse under the Pension Plan if all amounts
of base compensation or Incentive Compensation
5
<PAGE>
Plan awards deferred under the Deferred Compensation Plan were included in
Earnings (and if the limitations on benefits imposed by Section 18.1 of
the Pension Plan and on Earnings imposed by Section 401(a)(17) of the
Internal Revenue Code were not applicable) over (ii) the sum of (a) each
pension benefit payable under the Pension Plan and (b) any Excess Benefit
payable under this Plan.
For purposes of clause (i) of this Section 1.11, any amount of base
compensation deferred under the Deferred Compensation Plan shall be
treated as Earnings for the period in which such amount would have been
paid to the Employee in cash if the Employee had not elected to defer such
amount, and the amount of any award made to an Employee under the
Incentive Compensation Plan and deferred under the Deferred Compensation
Plan shall be treated as Earnings for the period corresponding to the
Performance Period for which such award is made to the Employee. No amount
of base compensation so deferred, and no amount awarded under the
Incentive Compensation Plan, shall be treated as Earnings for any period
other than the period determined under the preceding sentence.
For purposes of clause (i) of this Section 1.11, the amount of any
additional years of Creditable Service determined in accordance with
Section 5.9 of the Pension Plan will be recalculated by replacing the
Employee's annual base salary rate of Earnings as of April 1, 1989 by (a)
for purposes of calculating projected Basic Pensions, the product of (i)
such rate before any reductions on account of the Deferred Compensation
Plan times (ii) 1.0 plus the target award percentage as described under
the Incentive Compensation Plan and (b) for purposes of calculating the
accumulation of contributions of 2.25% or 2.10% of compensation, such rate
before any reductions on account of the Deferred Compensation Plan.
6
<PAGE>
SECTION 2
Application and Basis of the Plan
2.1 The Plan shall be applicable (i) in the case of the Excess Benefit, to
each Employee described in Section 2.1 of the Pension Plan and (ii) in the
case of the Supplemental Benefit, to each Employee described in clause (i)
who is an elected officer of the Company and to each other Employee
described in clause (i) who for any calendar year has Earnings (plus any
Incentive Compensation Plan awards deferred) in excess of the amount of
compensation for such year that can be taken into account for purposes of
the Pension Plan pursuant to Section 401(a)(17) of the Code.
7
<PAGE>
SECTION 3
Payment of Benefits
3.1 The Company shall pay to each Employee to whom this Plan is applicable, or
to the surviving spouse of any such Employee, the Excess Benefit and/or
the Supplemental Benefit determined for such Employee or surviving spouse
under Sections 1.7 and 1.11 hereof.
3.2 (a) The Excess Benefit and/or Supplemental Benefit payable hereunder to an
Employee or the Employee's surviving spouse shall be paid or commence
to be paid:
(i) on the first of the month following the Employee's retirement,
if the Employee retires in accordance with Section 3.1, 3.2, 3.3
or 3.4 of the Pension Plan,
(ii) on Normal Retirement Date, if the Employee becomes entitled to
benefits in accordance with Section 3.5 of the Pension Plan, or
(iii) in the case of a Benefit which becomes payable hereunder to an
Employee's surviving spouse on account of the Employee's death
before the Employee has received any Benefit payment hereunder,
on the earliest date as of which payment of such spouse's Basic
Pension under the applicable provisions of Section 9 of the
Pension Plan could commence, without regard to any election by
such spouse to defer the commencement of payment of such Basic
Pension.
(b) The Excess and/or Supplemental Benefit payable hereunder to the
Employee shall be paid in the form of a single life annuity, unless
the Employee is married on the date on which payment of such Benefit
is to be made or commence under Section 3.2(a) above, in which event
it shall be paid in the same form as Option 2, as described in Section
10.1 of the Pension Plan, with the Employee's spouse as the
beneficiary thereunder.
(c) Notwithstanding the preceding provisions of this Section 3.2, an
Employee may elect (i) to delay payment, or commencement of payment,
of his or her Excess and Supplemental Benefits to a specified date
after the date applicable under Section 3.2(a) but not later than the
Employee's Normal Retirement Date, or (ii) in the case of any Employee
who becomes entitled to benefits in accordance with Section 3.5 of the
Pension Plan, to accelerate payment, or commencement of payment, of
his or her Excess and Supplemental Benefits to a specified date before
the date applicable under Section 3.2(a) but not earlier than the
first day of the month immediately following his or her 55th
8
<PAGE>
birthday, and/or (iii) to have payment of his or her Excess and
Supplemental Benefits made (A) in any form permitted (without regard
to any requirements for spousal consent) under the Pension Plan other
than the form applicable under Section 3.2(b), or (B) in the form of a
single lump sum payment. The amount of the lump sum payment payable to
an Employee, or to his or her surviving spouse, pursuant to an
election by the Employee under clause (iii)(B) of the preceding
sentence shall be determined in the same manner as the amount of the
lump sum payment payable pursuant to an Employee's election under
clause (i) of the first paragraph of Section 3.2(h) would be
determined, as provided in the third paragraph of Section 3.2(h),
except that for purposes of determining the amount of the lump sum
payment so payable to the Employee, the actuarial equivalence of such
payment to the Excess and/or Supplemental Benefit that otherwise would
be payable hereunder to the Employee shall be determined as of the
date on which such lump sum payment is to be made to the Employee.
Any election under this Section 3.2(c) shall be effective only if it
is made at least twenty-four (24) months (twelve (12) months, if the
election is made on or before August 31, 1997) prior to the Employee's
retirement or other termination of employment. Any election made
under this Section 3.2(c) may be revoked, and a new election may be
made hereunder, at any time; provided, however, that any such
-------- -------
revocation or new election shall be effective only if it is made
within the period specified in the preceding sentence. Any election,
or revocation of an election, that may be made under this Section
3.2(c) shall be made in writing, on a form that is furnished to the
Employee for such purpose by the Administrative Committee and that is
signed by the Employee and delivered to the Administrative Committee.
(d) If payment of Excess and/or Supplemental Benefits commences earlier or
later than payment of Pension Plan benefits, the amount of the Excess
and/or Supplemental Benefits to be paid hereunder shall be determined
as though payment of Pension Plan benefits commenced on the same date
as payment of such Benefits commences, except that no increase in the
dollar limitation of section 415(b)(1)(A) of the Code occurring after
payment of Pension Plan benefits commences shall be taken into
account.
(e) If Excess and/or Supplemental Benefits are payable in any form other
than as a single lump sum payment and if payments under such form
commence on or after the date Pension Plan benefits commence to be
paid, the amount of Excess and/or Supplemental Benefits to be paid
hereunder shall be determined in accordance with the following
additional rules:
9
<PAGE>
(i) determine the Employee's Excess and/or Supplemental Benefits as
though such Benefits were payable in the same form, and with the same
beneficiary, if any, as Pension Plan benefits, and disregarding any
change in marital status occurring subsequent to the date on which
payment of Pension Plan benefits commence,
(ii) if the Employee's Pension Plan benefits are payable in accordance
with Option 1 or 2, as described in Section 10.1 of the Pension Plan,
divide the amount determined in (i) by the complement of the
reduction percentage applied to Pension Plan benefits in accordance
with such Section 10.1, to convert such amount into a benefit payable
in the form of a single life annuity, and
(iii) if payment of the Employee's Excess and/or Supplemental Benefits is
to be made in a form other than as a single life annuity, reduce the
amount determined in (ii) by the reduction percentage that would be
applicable under Section 10.1 of the Pension Plan to an annuity
payable thereunder to the Employee in the same form as the form in
which payment of the Employee's Excess and/or Supplemental Benefits
is to be made hereunder and with the same beneficiary.
If Excess and/or Supplemental Benefits are payable in any form other than
as a single lump sum payment and if payments under such form are to
commence before Pension Plan benefits commence to be paid, the amount of
such Benefits to be paid hereunder shall be determined as though Pension
Plan benefits were being paid at the same time and in the same form as
Excess and/or Supplemental Benefits, until such time as Pension Plan
benefits commence to be paid, at which time the amount of Excess and/or
Supplemental Benefits thereafter to be paid hereunder shall be adjusted, in
a manner consistent with the foregoing paragraph, to the extent necessary
to reflect any difference in the form of payment for the Employee's Pension
Plan benefits and the form of payment for his or her Excess and/or
Supplemental Benefits.
(f) In determining the amount of the Excess and/or Supplemental Benefit payable
hereunder to an Employee or the Employee's surviving spouse, there shall be
taken into account any increase in the amount of the pension benefit that
is payable, pursuant to Section 6 or Section 9 of the Pension Plan, to the
Employee or his or her surviving spouse for the first 12 months during
which such pension benefit is payable.
10
<PAGE>
(g) If, pursuant to Section 3.2(b) or (c) above, an Employee's Excess and/or
Supplemental Benefit is otherwise required to be paid in the same form as
Option 1 or Option 2 as described in Section 10.1 of the Pension Plan, and
if the person designated by the Employee as his or her beneficiary for
purposes of such payment form should die at any time prior to the fifth
anniversary of the date on which the Employee's Benefits hereunder commence
to be paid (the Employee's Benefit Starting Date), the Benefit amounts
payable to the Employee hereunder after the date of such beneficiary's
death shall be equal to the Benefit amounts that would have been payable to
the Employee hereunder after such date if such Benefit amounts had been
payable to the Employee, from his or her Benefit Starting Date, in the form
of a single life annuity.
(h) Notwithstanding any other provision of the Plan to the contrary or any
other optional form of distribution otherwise elected or provided for
hereunder, each Employee shall be permitted to make either one, or both, of
the following special distribution elections: (i) to have his or her Excess
and/or Supplemental Benefit distributed in the form of a single lump sum
payment in the event of the Employee's termination of employment for any
reason within the two (2) year period following a Change in Control, or
(ii) if a Change in Control occurs after the Employee's termination of
employment but before all payments required to be made hereunder with
respect to his or her Excess and/or Supplemental Benefits have been made,
to have the Excess and/or Supplemental Benefit payments that otherwise
would be made hereunder after the date of such Change in Control paid in
the form of a single lump sum payment.
An election under clause (i) of the preceding paragraph shall be effective
only if it is made either at least twenty-four (24) months prior to such
termination of the Employee's employment, or if such termination of
employment constitutes an "Involuntary Termination" as defined below, at
least one year prior to such Change in Control. An election under clause
(ii) of the preceding paragraph shall be effective only if it is made at
least one year prior to the Change in Control, and prior to the Employee's
termination of employment. Any special election made under clause (i) or
(ii) of the preceding paragraph may be revoked, and a new special election
may be made thereunder, at any time; provided, however, that any such
-------- -------
revocation or new election shall be effective only if it is made within the
election period specified in this paragraph. Any special election, or
revocation of a special election, that may be made hereunder shall be made
in the manner set forth in Section 3.2(c).
11
<PAGE>
The lump sum payment to be made to an Employee pursuant to his or her
election under clause (i) of the second preceding paragraph shall be in an
amount that is Actuarially Equivalent (as defined in the Pension Plan and
determined as of the first day of the month following the date of the
Employee's termination of employment) to the Excess and/or Supplemental
Benefit that otherwise would be payable hereunder to the Employee if (x)
payment of the Employee's Excess and/or Supplemental Benefit and the
benefits payable to the Employee under the Pension Plan were to commence on
the Employee's Normal Retirement Date (as defined in the Pension Plan) or,
if earlier, on the earliest date as of which the Employee could elect to
have payment of his or her benefits under the Pension Plan commence, (y)
the Employee's Excess and/or Supplemental Benefit were payable in the form
of a single life annuity, and (z) the Employee's benefits under the Pension
Plan were payable either (1) in the same form as Option 2 as described in
Section 10.1 of the Pension Plan with the Employee's spouse as the
beneficiary thereunder, if the Employee is married on the date of his or
her termination of employment, or (2) in the form of a single life annuity,
if the Employee is not married on such date. The lump sum payment to be
made to the surviving spouse of an Employee pursuant to the Employee's
election under clause (i) of the second preceding paragraph shall be in an
amount that is Actuarially Equivalent (as defined in the Pension Plan and
determined as of the first day of the month following the date of the
Employee's death) to the Excess and/or Supplemental Benefit that otherwise
would be payable hereunder to such spouse by reason of the Employee's
death. The lump sum payment to be made with respect to any Employee
pursuant to his or her election under clause (i) of the second preceding
paragraph shall be made by no later than thirty (30) days following the
date of the Employee's termination of employment.
The lump sum payment to be made pursuant to an Employee's election under
clause (ii) of the third preceding paragraph shall be in an amount that is
Actuarially Equivalent (as defined in the Pension Plan and determined as of
the first day of the month coincident with or next following the date on
which the Change in Control occurs) to the payments that otherwise would be
made hereunder with respect to the Employee's Excess and/or Supplemental
Benefits after the date of such Change in Control. Such lump sum payment
shall be made by no later than thirty (30) days following the date on which
such Change in Control occurs. If, as of the date on which such Change in
Control occurs, payments with respect to the Employee's benefits under the
Pension Plan, or with respect to his
12
<PAGE>
or her Excess and/or Supplemental Benefit hereunder, have not yet
commenced, the Actuarially Equivalent amount of the lump sum payment to be
made to the Employee pursuant to his or her election under clause
(ii) of the third preceding paragraph shall be determined using the same
assumptions as to the form and time of commencement of such payments as are
specified in clause (x), (y) or (z) of the preceding paragraph.
For purposes of this Section 3.2(h), an "Involuntary Termination" shall
mean the termination of an Employee's employment (A) as a result of the
Employee's death, (B) by the Company, for any reason, or (C) by the
Employee, for "Good Reason" as defined below. For purposes of the clause
(C) of the preceding paragraph, "Good Reason" shall mean the occurrence
after a Change in Control of any of the following events or conditions:
(1) a change in the Employee's status, title, position or responsibilities
(including reporting responsibilities) which, in the Employee's
reasonable judgement, represents an adverse change from his or her
status, title, position or responsibilities as in effect immediately
prior thereto; the assignment to the Employee of any duties or
responsibilities which, in the Employee's reasonable judgement, are
inconsistent with his or her status, title, position or
responsibilities; or any removal of the Employee from or failure to
reappoint or reelect him or her to any of such offices or positions,
other than in connection with the termination of his or her employment
for disability, for cause, or by the Employee other than for Good
Reason;
(2) any reduction in the rate of the Employee's annual base salary;
(3) the relocation of the offices of the Company at which the Employee is
principally employed to a location more than twenty-five (25) miles
from the location of such offices immediately prior to such
relocation, or the Company's requiring the Employee to be based
anywhere other than at such offices, except to the extent the Employee
was not previously assigned to a principal place of duty and except
for required travel on the Company's business to an extent
substantially consistent with the Employee's previous business travel
obligations;
13
<PAGE>
(4) the failure by the Company to pay to the Employee any amount of the
Employee's current compensation, or any amount payable under any
deferred compensation program of the Company in which the Employee
participated, within seven (7) days of the date on which payment of
such amount is due; or
(5) the failure by the Company (A) to continue in effect (without
reduction in benefit level, and/or reward opportunities) any material
compensation or employee benefit plan in which the Employee was
participating immediately prior to such failure by the Company unless
a substitute or replacement plan has been implemented which provides
substantially identical compensation or benefits to the Employee or
(B) to continue to provide the Employee with compensation and
benefits, in the aggregate, at least equal (in terms of benefit levels
and/or reward opportunities) to those provided for under all other
compensation or employee benefit plans, programs and practices in
which the Employee was participating immediately prior to such failure
by the Company.
Any event or condition described in clauses (1) through (5) above which
occurs (A) within twelve (12) months prior to a Change in Control or (B)
prior to a Change in Control but which (x) was at the request of a third
party who has indicated an intention or taken steps reasonably calculated
to effect a Change in Control and who effectuates a Change in Control, or
(y) otherwise arose in connection with, or in anticipation of, a Change in
Control which has been threatened or proposed and which actually occurs,
shall constitute Good Reason for purposes of this Section 3.2(h)
notwithstanding that it occurred prior to a Change in Control.
3.3 Each Employee entitled to benefits under the Plan shall have the status of
a mere unsecured creditor of the Company. The Plan shall constitute a mere
promise by the Company to make payments in the future of the benefits
provided for herein. It is intended that the arrangements reflected in
this Plan be treated as unfunded for tax purposes and for purposes of Title
I of ERISA.
3.4 An Employee's rights to benefit payments under this Plan shall not be
subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment or garnishment by creditors of
the Employee or his or her spouse or other beneficiary.
14
<PAGE>
SECTION 4
Administration
4.1 The Plan shall be administered by an Administrative Committee. The
Administrative Committee shall consist of such persons as the Company from
time to time may appoint to serve thereon. Action to appoint or remove
members of the Committee may be taken by the Company either by resolution
duly adopted by its Board of Directors, or by an instrument in writing
executed by an officer of the Company to whom authority to appoint or
remove members of the Committee has been delegated pursuant to a resolution
duly adopted by the Company's Board of Directors.
4.2 The Administrative Committee shall have the power to interpret the Plan, to
decide all questions that may arise as to the construction or application
of any of its provisions, and make all determinations as to the rights of
Employees or other persons to benefits under the Plan. Any determination
made by the Administrative Committee prior to a Change in Control as to the
interpretation, construction or application of the Plan, or as to the
rights of any Employee or other persons to benefits under the Plan, shall
be conclusive and binding on all parties. Any such determination made by
the Administrative Committee after the occurrence of a Change in Control
that denies, in whole or in part, any claim made by any individual for
benefits hereunder shall be subject to judicial review, under a "de novo",
rather than a deferential, standard.
4.3 Each member of the Administrative Committee shall be indemnified and held
harmless by the Company for any liability or loss (including legal fees or
other expenses of litigation) arising out of or in connection with his or
her services to the Plan in such capacity, to the extent that such
liability or loss (a) is not insured against under any applicable policy of
insurance (whether or not maintained by the Company) and (b) is not
determined to be due to the gross negligence or willful misconduct of such
member or other person.
15
<PAGE>
SECTION 5
Amendment and Termination
5.1 Subject to Section 5.3, the Company may amend the Plan at any time. Any
such amendment may be made with retroactive effect to the extent not
prohibited by law.
Action to amend the Plan may be taken by the Company either by resolution
duly adopted by the Company's Board of Directors, or by an instrument in
writing executed by an officer of the Company to whom authority to adopt or
approve amendments to the Plan has been delegated pursuant to a resolution
duly adopted by the Company's Board of Directors.
5.2 Subject to the provisions of Section 5.3, the Plan may be terminated at any
time by the Board of Directors.
5.3 Notwithstanding the provisions of Sections 5.1 and 5.2, (a) no amendment to
or termination of the Plan shall impair any rights to benefits which have
accrued hereunder and (b) no amendment to Section 3.2(h), Section 4.2 or to
this Section 5.3, nor any termination of the Plan, effectuated (i) at the
C-90 Deferred Remuneration Plan for Outside Directors of JCP7&L dated
June 5, 1997 - incorporated by reference to Exhibit 10-J to JCP&L's
Annual Report on Form 10-k for the year 1997, File No. 1-3141.
request of a third party who has indicated an intention or taken steps to
effect a Change in Control and who effectuates a Change in Control, (ii)
within six (6) months prior to, or otherwise in connection with, or in
anticipation of, a Change in Control which has been threatened or proposed
and which actually occurs, or (iii) following a Change in Control, shall be
effective if the amendment or termination adversely affects the rights of
any Employee under the Plan.
<PAGE>
16
<PAGE>
EXHIBIT C-24
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 5th day of November, 1998, by and
--- --------------
among GPU, Inc. (the "Corporation"), GPU Service, Inc. (the "Company") and Fred
----
D. Hafer (the "Executive") amends and restates the former Severance Protection
- ---------
Agreement dated June 5, 1997 by and among the Corporation, the Company and the
------------
Executive (the "Former Agreement").
WHEREAS, the Board of Directors of the Company and the Board of
Directors of the Corporation (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation;
WHEREAS, the Boards have determined that it is essential and in the
best interest of the Company, and the Corporation and its stockholders, for the
Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Company, particularly in the event of a threat or the occurrence of a Change
in Control, the Company desires to enter into this Agreement with the Executive
to provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of November
-----------------
5, 1998, and shall continue in effect until October 31, 2000 (the "Term");
provided, however, that on November 1, 1999, and on each November 1 thereafter,
the Term shall automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to the other at least
ninety (90) days prior thereto that the Term shall not be so extended; provided,
further, however, that
<PAGE>
following the occurrence of a Change in Control, the Term shall not expire prior
to the expiration of twenty-four (24) months after such occurrence.
2. Termination of Employment. If the Executive's employment with the
-------------------------
Company and with all other Affiliates of the Corporation shall be terminated
within twenty-four (24) months following a Change in Control, the Executive
shall be entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated for any reason the
Company shall pay to the Executive his Accrued Compensation. In addition to the
foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated (i) by the Company
without Cause (other than by reason of the Executive's Disability), (ii) by the
Executive for Good Reason at any time after six the (6) month period following
the date of a Change in Control, or (iii) by the Executive for any reason during
the six (6) month period following the date of a Change in Control, the
Executive shall be entitled to the following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance pay and
in lieu of any further compensation for periods subsequent to the Termination
Date, an amount determined by multiplying (A) three (3) times the sum of (i) the
Executive's Base Amount and (ii) the Executive's Bonus Amount by (B) a fraction,
the numerator of which is the number of months, not to exceed thirty-six (36),
in the period beginning on the Termination Date and ending on the Executive's
Normal Retirement Date (as defined in the Company's Employee Pension Plan), and
the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36), or if
earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the
2
<PAGE>
Executive immediately prior to the Change in Control or, if greater, the
coverages and benefits provided at any time thereafter. The coverages and
benefits (including deductibles and costs) provided in this Section 2(b)(3)
during the Continuation Period shall be no less favorable to the Executive and
his dependents and beneficiaries, than the most favorable of such coverages and
benefits referred to above. The Company's obligation hereunder with respect to
the foregoing coverages and benefits shall be reduced to the extent that the
Executive obtains any such coverages and benefits pursuant to a subsequent
employer's benefit plans, in which case the Company may reduce any of the
coverages or benefits it is required to provide the Executive hereunder so long
as the aggregate coverages and benefits of the combined benefit plans is no less
favorable to the Executive than the coverages and benefits required to be
provided hereunder. This Section 2(b)(3) shall not be interpreted so as to
limit any benefits to which the Executive, his dependents or beneficiaries may
be entitled under any of the Company's employee benefit plans, programs or
practices following the Executive's termination of employment, including without
limitation, retiree medical and life insurance benefits;
(4) the Company shall pay or reimburse the Executive for the
costs, fees and expenses of outplacement assistance services (not to exceed
twenty percent (20%) of the sum of (A) the Executive's Base Amount and (B) the
Executive's Bonus Amount) provided by any outplacement agency selected by the
Executive.
(5) the Company shall provide to the Executive the use of a
Company-leased vehicle, at no cost to the Executive, until the earlier of (A)
the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the Company
without Cause (other than by reason of the Executive's Disability) (1) within
twelve (12) months prior to a Change in Control or (2) any time prior to the
date of a Change in Control but the Executive reasonably demonstrates that such
termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control
3
<PAGE>
which has been threatened or proposed, such termination shall be deemed to have
occurred after a Change in Control provided a Change in Control shall actually
have occurred.
(d) (1) Gross-Up Payment. In the event it shall be determined that
----------------
any payment or distribution of any type to or for the benefit of the Executive,
by the Company, the Corporation, any Affiliate, any Person (as defined in
Section 15.6(a) hereof) who acquires ownership or effective control of the
Corporation or ownership of a substantial portion of the Corporation's assets
(within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the "Code"), and the regulations thereunder) or any affiliate of such
Person, whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise (the "Total Payments"), is or will be
subject to the excise tax imposed by Section 4999 of the Code or any interest or
penalties with respect to such excise tax (such excise tax, together with any
such interest and penalties, are collectively referred to as the "Excise Tax"),
then the Executive shall be entitled to receive an additional payment (a "Gross-
Up Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
4
<PAGE>
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive, absent manifest error. As
a result of uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment or Overpayment
that has occurred. In the case of an Underpayment, the amount of such
Underpayment shall be promptly paid by the Company to or for the benefit of the
Executive. In the case of an Overpayment, the Executive shall, at the direction
and expense of the Company, take such steps as are reasonably necessary
(including the filing of returns and claims for refund), follow reasonable
instructions from, and procedures established by, the Company, and otherwise
reasonably cooperate with the Company to correct such Overpayment, provided,
however, that (i) the Executive shall not in any event be obligated to return to
the Company an amount greater than the net after-tax portion of the Overpayment
that he has retained or has recovered as a refund from the applicable taxing
authorities and (ii) this provision shall be interpreted in a manner consistent
with the intent of Section 2(d)(1), which is to make the Executive whole, on an
after-tax basis, from the application of the Excise Tax, it being understood
that the correction of an Overpayment may result in the Executive repaying to
the Company an amount which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1), (2) and
(4) shall be paid in a single lump sum cash payment within thirty (30) days
after the Executive's Termination Date (or earlier, if required by applicable
law).
(f) The Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
5
<PAGE>
(g) The severance pay and benefits provided for in this Section 2
shall be in lieu of any other severance pay to which the Executive may be
entitled under the GPU System Severance Procedure or any other plan, agreement
or arrangement of the Company or any other Affiliate of the Corporation.
(h) The Executive's entitlement to other compensation or benefits
pursuant to the Company's employee benefit plans and other applicable programs
and practices shall be determined in accordance with the terms of those plans,
programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i) any
---------------------
intended termination of the Executive's employment by the Company shall be
communicated by a Notice of Termination from the Company to the Executive, and
(ii) any intended termination of the Executive's employment by the Executive for
Good Reason shall be communicated by a Notice of Termination from the Executive
to the Company within six (6) months of the Executive becoming aware of the
event or action constituting Good Reason or, if later, within six (6) months
after the date of the Change in Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under
6
<PAGE>
this Agreement if (a) the Executive's employment with the Company terminates as
a result of the transfer of his employment to any other Affiliate of the
Corporation, (b) this Agreement is assigned to such other Affiliate, and (c)
such other Affiliate expressly assumes and agrees to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no assignment had taken place. Any Affiliate to which this
Agreement is so assigned shall be treated as the "Company" for all purposes of
this Agreement on or after the date as of which such assignment to the
Affiliate, and the Affiliate's assumption and agreement to so perform this
Agreement, becomes effective.
6. Corporation's Obligation. The Corporation agrees that it will
------------------------
take such steps as may be necessary to cause the Company (or any Affiliate that
has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
7. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a mere
----------------
unsecured creditor of the Company and the Corporation with respect to his right
to receive any payment under this Agreement. This Agreement shall constitute a
mere promise by the Company and the Corporation to make payments in the future
of the benefits provided for herein. It is the intention of the parties hereto
that the arrangements reflected in this Agreement shall be treated as unfunded
for tax purposes and, if it should be determined that Title I of ERISA is
applicable to this Agreement, for purposes of Title I of ERISA. Except as
provided in Section 2(g), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan or
7
<PAGE>
program provided by the Company, the Corporation or any other Affiliate of the
Corporation and for which the Executive may qualify, nor shall anything herein
limit or reduce such rights as the Executive may have under any other agreements
with the Company, the Corporation or any other Affiliate of the Corporation.
Amounts which are vested benefits or which the Executive is otherwise entitled
to receive under any plan or program of the Company, the Corporation or any
other Affiliate of the Corporation shall be payable in accordance with such plan
or program, except as explicitly modified by this Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, defense, recoupment, or other right which
the Company may have against the Executive or others.
10. Miscellaneous. No provision of this Agreement may be modified,
-------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive, the Corporation and the Company. No
waiver by any party hereto at any time of any breach by any other party hereto
of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreement or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by any party which are not
expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
8
<PAGE>
12. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of New Jersey without
giving effect to the conflict of laws principles thereof. Any action brought by
any party to this Agreement shall be brought and maintained in a court of
competent jurisdiction in Morris County in the State of New Jersey.
13. Severability. The provisions of this Agreement shall be deemed
------------
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto
with respect to the subject matter hereof, including the Former Agreement.
15. Definitions.
-----------
15.1. Accrued Compensation. For purposes of this Agreement,
--------------------
"Accrued Compensation" shall mean all amounts of compensation for services
rendered to the Company and any other Affiliate that have been earned or accrued
through the Termination Date but that have not been paid as of the Termination
Date including (a) base salary, (b) reimbursement for reasonable and necessary
business expenses incurred by the Executive on behalf of the Company during the
period ending on the Termination Date, (c) vacation pay and (d) bonuses and
incentive compensation; provided, however, that Accrued Compensation shall not
include any amounts described in clause (a) or clause (d) that have been
deferred pursuant to any salary reduction or deferred compensation elections
made by the Executive.
15.2. Affiliate. For purposes of this Agreement, "Affiliate"
---------
means any entity, directly or indirectly, controlled by, controlling or under
common control with the Corporation or any corporation or other entity
acquiring, directly or indirectly, all or substantially all the assets and
business of the Corporation, whether by operation of law or otherwise.
15.3. Base Amount. For purposes of this Agreement, "Base
-----------
Amount" shall mean the Executive's annual base salary at the rate in effect as
of the date of a Change in Control or, if greater, at any time thereafter,
determined without regard to any salary reduction or deferred compensation
elections made by the Executive.
9
<PAGE>
15.4. Bonus Amount. For purposes of this Agreement, "Bonus
------------
Amount" shall mean the greater of (a) the target annual bonus payable to the
Executive under the Incentive Plan in respect of the fiscal year during which
the Termination Date occurs or (b) the highest annual bonus paid or payable
under the Incentive Plan in respect of any of the three full fiscal years ended
prior to the Termination Date or, if greater, the three (3) full fiscal years
ended prior to the Change in Control.
15.5. Cause. For purposes of this Agreement, a termination of
-----
employment is for "Cause" if the Executive has been convicted of a felony or the
termination is evidenced by a resolution adopted in good faith by two-thirds of
the Board of Directors of the Corporation that the Executive:
(a) intentionally and continually failed substantially
to perform his reasonably assigned duties with the Company or the Corporation
(other than a failure resulting from the Executive's incapacity due to physical
or mental illness or from the assignment to the Executive of duties that would
constitute Good Reason) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company or the Corporation has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or
(b) intentionally engaged in conduct which is
demonstrably and materially injurious to the Corporation or the Company;
provided, however, that no termination of the Executive's employment shall be
for Cause as set forth in this Section 15.5(b) until (1) there shall have been
delivered to the Executive a copy of a written notice, signed by a duly
authorized officer of the Company or the Corporation, setting forth that the
Executive was guilty of the conduct set forth in this Section 15.5(b) and
specifying the particulars thereof in detail, and (2) the Executive shall have
been provided an opportunity to be heard in person by the Board of Directors of
the Corporation (with the assistance of the Executive's counsel if the Executive
so desires).
No act, nor failure to act, on the Executive's part,
shall be considered "intentional" unless the Executive has acted, or failed to
act, with a lack of good faith and with a lack of reasonable belief that the
Executive's action or failure to act was in the best interest of the Corporation
and the Company. Notwithstanding anything contained in this Agreement to the
contrary, no failure to perform by the Executive after a Notice of Termination
is given
10
<PAGE>
to the Company by the Executive shall constitute Cause for purposes of this
Agreement.
15.6. Change in Control. A "Change in Control" shall mean the
-----------------
occurrence during the term of the Agreement of:
(a) An acquisition (other than directly from the
Corporation) of any common stock of the Corporation ("Common Stock") or other
voting securities of the Corporation entitled to vote generally for the election
of directors (the "Voting Securities") by any "Person" (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), immediately after which such Person has
"Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty percent (20%) or more of the then outstanding shares of
Common Stock or the combined voting power of the Corporation's then outstanding
Voting Securities; provided, however, in determining whether a Change in Control
has occurred, Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an acquisition which
would cause a Change in Control. A "Non-Control Acquisition" shall mean an
acquisition by (i) an employee benefit plan (or a trust forming a part thereof)
maintained by (A) the Corporation or (B) any corporation or other Person of
which a majority of its voting power or its voting equity securities or equity
interest is owned, directly or indirectly, by the Corporation (a "Subsidiary")
(ii) the Corporation or its Subsidiaries, or (iii) any Person in connection with
a "Non-Control Transaction" (as hereinafter defined);
(b) The individuals who, as of August 1, 1996, are members of the
Board of Directors of the Corporation (the "Incumbent Board"), cease for any
reason to constitute at least seventy percent (70%) of the members of the Board
of Directors of the Corporation; provided, however, that if the election, or
nomination for election by the Corporation's shareholders, of any new director
was approved by a vote of at least two-thirds of the Incumbent Board, such new
director shall, for purposes of this Agreement, be considered as a member of the
Incumbent Board; provided further, however, that no individual shall be
considered a member of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened "Election Contest" (as
described in Rule 14a-11 promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors of the Corporation (a "Proxy Contest") including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest; or
11
<PAGE>
(c) The consummation of:
(1) A merger, consolidation or reorganization with or into
the Corporation or in which securities of the Corporation are issued, unless
such merger, consolidation or reorganization is a "Non-Control Transaction." A
"Non-Control Transaction" shall mean a merger, consolidation or reorganization
with or into the Corporation or in which securities of the Corporation are
issued where:
(A) the shareholders of the Corporation, immediately
before such merger, consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or reorganization, at least
sixty percent (60%) of the combined voting power of the outstanding voting
securities of the corporation resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities immediately before such
merger, consolidation or reorganization,
(B) the individuals who were members of the Incumbent
Board immediately prior to the execution of the agreement providing for such
merger, consolidation or reorganization constitute at least seventy percent
(70%) of the members of the board of directors of the Surviving Corporation, or
a corporation beneficially directly or indirectly owning a majority of the
Voting Securities of the Surviving Corporation, and
(C) no Person other than (i) the Corporation, (ii) any
Subsidiary, (iii) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation or any Subsidiary, or (iv) any
Person who, immediately prior to such merger, consolidation or reorganization
had Beneficial Ownership of twenty percent (20%) or more of the then outstanding
Voting Securities or common stock of the Corporation, has Beneficial Ownership
of twenty percent (20%) or more of the combined voting power of the Surviving
Corporation's then outstanding voting securities or its common stock.
(2) A complete liquidation or dissolution of the
Corporation; or
(3) The sale or other disposition of all or substantially
all of the assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
12
<PAGE>
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then outstanding
Common Stock or Voting Securities as a result of the acquisition of Common Stock
or Voting Securities by the Corporation which, by reducing the number of shares
of Common Stock or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of shares of Common Stock or Voting Securities by
the Corporation, and after such share acquisition by the Corporation, the
Subject Person becomes the Beneficial Owner of any additional shares of Common
Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
15.7. Company and Corporation. For purposes of this
-----------------------
Agreement, all references to the Company and the Corporation shall include their
respective Successors and Assigns.
15.8. Disability. For purposes of this Agreement,
----------
"Disability" shall mean a physical or mental infirmity which impairs the
Executive's ability to substantially perform his duties with the Company for six
(6) consecutive months, and within the time period set forth in a Notice of
Termination given to the Executive (which time period shall not be less than
thirty (30) days), the Executive shall not have returned to full-time
performance of his duties; provided, however, that if the Company's Voluntary
Employees Beneficiary Association Long Term Disability Income Plan, or any
successor plan (the "Disability Plan"), is then in effect, the Executive shall
not be deemed disabled for purposes of this Agreement unless the Executive is
also eligible for "Total Disability" (as defined in the Disability Plan)
benefits (or similar benefits in the event of a successor plan) under the
Disability Plan.
15.9. Good Reason. (a) For purposes of this Agreement,
-----------
"Good Reason" shall mean the occurrence after a Change in Control of any of the
following events or conditions:
(1) a change in the Executive's status, title,
position or responsibilities (including reporting responsibilities) which, in
the Executive's reasonable judgment, represents an adverse change from his
status, title, position or
13
<PAGE>
responsibilities as in effect immediately prior thereto; the assignment to the
Executive of any duties or responsibilities which, in the Executive's reasonable
judgment, are inconsistent with his status, title, position or responsibilities;
or any removal of the Executive from or failure to reappoint or reelect him to
any of such offices or positions, except in connection with the termination of
his employment for Disability, Cause, as a result of his death or by the
Executive other than for Good Reason;
(2) a reduction in the Executive's annual base salary
below the Base Amount;
(3) the relocation of the offices of the Company at
which the Executive is principally employed to a location more than twenty-five
(25) miles from the location of such offices immediately prior to the Change in
Control, or the Company's or the Corporation's requiring the Executive to be
based anywhere other than such offices, except to the extent the Executive was
not previously assigned to a principal location and except for required travel
on the Company's or the Corporation's business to an extent substantially
consistent with the Executive's business travel obligations at the time of the
Change in Control;
(4) the failure by the Company or the Corporation to
pay to the Executive any portion of the Executive's current compensation or to
pay to the Executive any portion of an installment of deferred compensation
under any deferred compensation program of the Company or the Corporation in
which the Executive participated, within seven (7) days of the date such
compensation is due;
(5) the failure by the Company or the Corporation to
(A) continue in effect (without reduction in benefit level, and/or reward
opportunities) any material compensation or employee benefit plan in which the
Executive was participating immediately prior to the Change in Control,
including, but not limited to, any of the plans listed in Appendix A hereto,
unless a substitute or replacement plan has been implemented which provides
substantially identical compensation or benefits to the Executive or (B) provide
the Executive with compensation and benefits, in the aggregate, at least equal
(in terms of benefit levels and/or reward opportunities) to those provided for
under each other compensation or employee benefit plan, program and practice in
which the Executive was participating immediately prior to the Change in
Control;
14
<PAGE>
(6) the failure of the Company or the Corporation to
obtain from its Successors or Assigns the express assumption and agreements
required under Section 11 hereof; or
(7) any purported termination of the Executive's
employment by the Company which is not effected pursuant to a Notice of
Termination satisfying the terms set forth in the definition of Notice of
Termination (and, if applicable, the terms set forth in the definition of
Cause).
(b) Any event or condition (1) described in Section
15.9(a)(1), (2), (3), (4), (6) or (7) which occurs within twelve (12) months
prior to a Change in Control or (2) described in Section 15.9(a)(1) through (7)
which occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a Third Party who effectuates a Change in
Control or (B) otherwise arose in connection with, or in anticipation of a
Change in Control which has been threatened or proposed and which actually
occurs, shall constitute Good Reason for purposes of this Agreement
notwithstanding that it occurred prior to a Change in Control.
15.10. Incentive Plan. For purposes of this Agreement,
--------------
"Incentive Plan" shall mean the Incentive Compensation Plan for Elected
Officers, or any successor annual incentive plan, maintained by the Company or
any other Affiliate.
15.11. Notice of Termination. For purposes of this
---------------------
Agreement, following a Change in Control, "Notice of Termination" shall mean a
written notice of termination of the Executive's employment, signed by the
Executive if to the Company or by a duly authorized officer of the Company if to
the Executive, which indicates the specific termination provision in this
Agreement, if any, relied upon and which sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated.
15.12. Pro Rata Bonus. For purposes of this Agreement,
--------------
"Pro Rata Bonus" shall mean an amount equal to the Bonus Amount multiplied by a
fraction the numerator of which is the number of days in such fiscal year
through the Termination Date and the denominator of which is 365; provided,
however, that the Pro Rata Bonus shall be reduced, but not below zero, to the
extent of any bonus the Executive is entitled to receive pursuant to the
Incentive Plan in respect of the fiscal year (denoted a "Performance Period"
under the Incentive Plan) in which the Termination Date occurs.
15
<PAGE>
15.13. Successors and Assigns. For purposes of this
----------------------
Agreement, "Successors and Assigns" shall mean, with respect to the Company or
to the Corporation, a corporation or other entity acquiring all or substantially
all the assets and business of the Company or the Corporation, as the case may
be, (including this Agreement) whether by operation of law or otherwise.
15.14. Termination Date.
----------------
(a) For purposes of this Agreement, "Termination
Date" shall mean (i) in the case of the Executive's death, his date of death,
(ii) if the Executive's employment is terminated for Disability, thirty (30)
days after Notice of Termination is given (provided that the Executive shall not
have returned to the performance of his duties on a full-time basis during such
thirty (30) day period) and (iii) if the Executive's employment is terminated
for any other reason, the date specified in the Notice of Termination (which, in
the case of a termination for Cause shall not be less than thirty (30) days, and
in the case of a termination for Good Reason shall not be more than sixty (60)
days, from the date such Notice of Termination is given); provided, however,
that if within thirty (30) days after a Notice of Termination by the Company for
Cause or a Notice of Termination by the Executive for Good Reason is given the
party receiving such Notice of Termination in good faith notifies the other
party that a dispute exists concerning the basis for the termination, the
provisions of paragraph (b) shall apply.
(b)(i) If the Executive gives the Company Notice
of Termination for Good Reason and the Company disputes the basis for the
termination, the Termination Date shall be the date on which the dispute is
finally determined, either by mutual written agreement of the parties, or by the
final judgment, order or decree of a court of competent jurisdiction (the time
for appeal therefrom having expired and no appeal having been taken) and the
Company shall continue to pay the Executive his Base Amount and continue the
Executive as a participant in all compensation, incentive, bonus, pension,
profit sharing, medical, hospitalization, dental, life insurance and disability
benefit plans in which he was participating when the notice giving rise to the
dispute was given, until such Termination Date, provided that if the Executive
continues to perform his duties with the Company during the pendency of such
dispute, the Executive shall not be obligated to repay to the Company any
amounts paid or benefits provided pursuant to this Section 15.14(b), and further
16
<PAGE>
provided that if the Executive ceased performing his duties with the Company
during the pendency of such dispute, and the dispute is resolved in favor of the
Executive, any amount owed to the Executive pursuant to Section 2 of this
Agreement shall be reduced to the extent of any amount the Executive received
pursuant to this Section 15.14(b) during the pendency of such dispute; and (ii)
if the Company gives the Executive Notice of Termination for Cause and the
Executive disputes the basis for the termination, the Termination Date shall be
as determined pursuant to Section 15.14(a) and during the pendency of such
dispute the Executive shall not be entitled to payment of his Base Amount from
the Company and, except as required by law, the Executive's participation in the
Company's benefit plans and programs shall be discontinued.
17
<PAGE>
IN WITNESS WHEREOF, the Corporation and the Company have caused this
Agreement to be executed by their duly authorized officers and the Executive has
executed this Agreement as of the day and year first above written.
GPU, Inc.
ATTEST: By: _______________________________
Ira H. Jolles
Senior Vice President -
General Counsel
Secretary
GPU Service, Inc.
ATTEST: By: ________________________________
Ira H. Jolles
Executive Vice President -
Secretary General Counsel
By: ________________________________
Fred D. Hafer
18
<PAGE>
APPENDIX A
1. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
2. The Company's Incentive Plan
3. The GPU System Companies Deferred Compensation Plan
4. The GPU Companies Employee Pension Plan
5. The Company's Supplemental and Excess Benefits Plan
6. The Company's Employee Life Insurance Plan
7. Senior Executive Split-Dollar Life Insurance Program
8. The GPU Companies Accident Insurance Plan
9. The GPU Companies Health Care Plan for Non-Bargaining Unit Employees and
the Company's Health Care Plan for Non-bargaining Retirees, if applicable
10. The GPU Companies Supplemental Medical Expense Plan for Elected Officers
11. The GPU Companies Flexible Benefits Plan for Non-bargaining Employees
12. The GPU Companies Group Specified Disease Insurance Plan
13. The GPU Companies Long Term Disability Income Plan
14. The GPU Companies Employee Savings Plan
15. The Company's Vacation Policy for Non-Bargaining Unit Employees
19
<PAGE>
EXHIBIT C-25
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 5th day of November, 1998, by and
------- ---------------
among GPU, Inc. (the "Corporation"), GPU Service, Inc. (the "Company") and
Ira H. Jolles (the "Executive") amends and restates the former Severance
- ---------------
Protection Agreement dated June 5, 1997 by and among the Corporation, the
------------
Company and the Executive (the "Former Agreement").
WHEREAS, the Board of Directors of the Corporation and the Board of
Directors of the Company (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation
WHEREAS, the Boards have determined that it is essential and in the
best interest of the Company, and the Corporation and its stockholders, for the
Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Company, particularly in the event of a threat or the occurrence of a Change
in Control, the Company desires to enter into this Agreement with the Executive
to provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of November
-----------------
5, 1998, and shall continue in effect until October 31, 2000 (the "Term");
provided, however, that on November 1, 1999, and on each November 1 thereafter,
the Term shall automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to the other at least
ninety (90) days prior thereto that the Term shall not be so extended; provided,
further, however, that following the occurrence
<PAGE>
of a Change in Control, the Term shall not expire prior to the expiration of
twenty-four (24) months after such occurrence.
2. Termination of Employment. If the Executive's employment with the
-------------------------
Company and with all other Affiliates of the Corporation shall be terminated
within twenty-four (24) months following a Change in Control, the Executive
shall be entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated for any reason, the
Company shall pay to the Executive his Accrued Compensation. In addition to the
foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated (i) by the Company
without Cause (other than by reason of the Executive's Disability), or (ii) by
the Executive for Good Reason, the Executive shall be entitled to the following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance pay and
in lieu of any further compensation for periods subsequent to the Termination
Date, an amount determined by multiplying (A) three (3) times the sum of (i) the
Executive's Base Amount and (ii) the Executive's Bonus Amount, by (B) a
fraction, the numerator of which is the number of months, not to exceed thirty-
six (36), in the period beginning on the Termination Date and ending on the
Executive's Normal Retirement Date (as defined in the Company's Employee Pension
Plan), and the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36), or if
earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the Executive immediately
prior to the Change in Control or, if greater, the coverages and benefits
provided at any time thereafter. The coverages and benefits (including
deductibles and costs) provided in this Section 2(b)(3) during the Continuation
Period shall be no less favorable to the Executive and his dependents and
beneficiaries, than the most
2
<PAGE>
favorable of such coverages and benefits referred to above. The Company's
obligation hereunder with respect to the foregoing coverages and benefits shall
be reduced to the extent that the Executive obtains any such coverages and
benefits pursuant to a subsequent employer's benefit plans, in which case the
Company may reduce any of the coverages or benefits it is required to provide
the Executive hereunder so long as the aggregate coverages and benefits of the
combined benefit plans is no less favorable to the Executive than the coverages
and benefits required to be provided hereunder. This Section 2(b)(3) shall not
be interpreted so as to limit any benefits to which the Executive, his
dependents or beneficiaries may be entitled under any of the Company's employee
benefit plans, programs or practices following the Executive's termination of
employment, including without limitation, retiree medical and life insurance
benefits;
(4) the Company shall pay or reimburse the Executive for the
costs, fees and expenses of outplacement assistance services (not to exceed
twenty percent (20%) of the sum of (A) the Executive's Base Amount and (B) the
Executive's Bonus Amount) provided by any outplacement agency selected by the
Executive; and
(5) the Company shall provide to the Executive the use of a
Company-leased vehicle, at no cost to the Executive, until the earlier of (A)
the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the Company
without Cause (other than by reason of the Executive's Disability) (1) within
twelve (12) months prior to a Change in Control or (2) any time prior to the
date of a Change in Control but the Executive reasonably demonstrates that such
termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control which has been
threatened or proposed such termination shall be deemed to have occurred after a
Change in Control, provided a Change in Control shall actually have occurred.
(d) (1) Gross-Up Payment. In the event it shall be determined
----------------
that any payment or distribution of any type to or for the benefit of the
Executive, by the Company, the Corporation, any Affiliate, any Person (as
defined in Section
3
<PAGE>
15.6(a) hereof) who acquires ownership or effective control of the Corporation
or ownership of a substantial portion of the Corporation's assets (within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
"Code"), and the regulations thereunder) or any affiliate of such Person,
whether paid or payable or distributed or distributable pursuant to the terms of
this Agreement or otherwise (the "Total Payments"), is or will be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax, imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding
4
<PAGE>
upon the Company and the Executive, absent manifest error. As a result of
uncertainty in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment or Overpayment
that has occurred. In the case of an Underpayment, the amount of such
Underpayment shall be promptly paid by the Company to or for the benefit of the
Executive. In the case of an Overpayment, the Executive shall, at the direction
and expense of the Company, take such steps as are reasonably necessary
(including the filing of returns and claims for refund), follow reasonable
instructions from, and procedures established by, the Company, and otherwise
reasonably cooperate with the Company to correct such Overpayment, provided,
however, that (i) the Executive shall not in any event be obligated to return to
the Company an amount greater than the net after-tax portion of the Overpayment
that he has retained or has recovered as a refund from the applicable taxing
authorities and (ii) this provision shall be interpreted in a manner consistent
with the intent of Section 2(d)(1), which is to make the Executive whole, on an
after-tax basis, from the application of the Excise Tax, it being understood
that the correction of an Overpayment may result in the Executive repaying to
the Company an amount which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1), (2)
and (4) shall be paid in a single lump sum cash payment within thirty (30) days
after the Executive's Termination Date (or earlier, if required by applicable
law).
(f) The Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
(g) The severance pay and benefits provided for in this Section 2
shall be in lieu of any other severance pay to which the Executive may be
entitled under the GPU System Severance Procedure or any other plan, agreement
or arrangement of the Company or any other Affiliate of the Corporation.
Notwithstanding the foregoing, the Corporation and the Company hereby
acknowledge that the severance pay and benefits provided
5
<PAGE>
for in this Section 2 shall be in addition to and shall in no way limit the
payments and benefits to which the Executive may be entitled under the letter
agreement dated as of August 7, 1997 between the Company and the Executive (the
"Letter Agreement").
(h) The Executive's entitlement to other compensation or benefits
pursuant to the Company's employee benefit plans and other applicable programs
and practices shall be determined in accordance with the terms of those plans,
programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i) any
---------------------
intended termination of the Executive's employment by the Company shall be
communicated by a Notice of Termination from the Company to the Executive, and
(ii) any intended termination of the Executive's employment by the Executive for
Good Reason shall be communicated by a Notice of Termination from the Executive
to the Company within six (6) months of the Executive becoming aware of the
event or action constituting Good Reason or, if later, within six (6) months
after the date of the Change in Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under this Agreement if (a) the Executive's
employment with the Company terminates as a result of the transfer of his
employment to any
6
<PAGE>
other Affiliate of the Corporation, (b) this Agreement is assigned to such other
Affiliate, and (c) such other Affiliate expressly assumes and agrees to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no assignment had taken place. Any Affiliate to
which this Agreement is so assigned shall be treated as the "Company" for all
purposes of this Agreement on or after the date as of which such assignment to
the Affiliate, and the Affiliate's assumption and agreement to so perform this
Agreement, becomes effective.
6. Corporation's Obligation. The Corporation agrees that it will
------------------------
take such steps as may be necessary to cause the Company (or any Affiliate that
has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
7. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a mere
----------------
unsecured creditor of the Company and the Corporation with respect to his right
to receive any payment under this Agreement. This Agreement shall constitute a
mere promise by the Company and the Corporation to make payments in the future
of the benefits provided for herein. It is the intention of the parties hereto
that the arrangements reflected in this Agreement shall be treated as unfunded
for tax purposes and, if it should be determined that Title I of ERISA is
applicable to this Agreement, for purposes of Title I of ERISA. Except as
provided in Section 2(g), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan or program provided by the Company, the Corporation or any other
Affiliate of the Corporation and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as
7
<PAGE>
the Executive may have under any other agreements with the Company, the
Corporation or any other Affiliate of the Corporation. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan
or program of the Company, the Corporation or any other Affiliate of the
Corporation shall be payable in accordance with such plan or program, except as
explicitly modified by this Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, defense, recoupment, or other right which
the Company may have against the Executive or others.
10. Miscellaneous. No provision of this Agreement may be modified,
-------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive, the Corporation and the Company. No
waiver by any party hereto at any time of any breach by any other party hereto
of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreement or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by any party which are not
expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
12. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the
8
<PAGE>
State of New Jersey without giving effect to the conflict of laws principles
thereof. Any action brought by any party to this Agreement shall be brought and
maintained in a court of competent jurisdiction in Morris County in the State of
New Jersey.
13. Severability. The provisions of this Agreement shall be deemed
------------
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto, and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto,
with respect to the subject matter hereof, including the Former Agreement it
being understood however, that this Agreement shall not supersede or in any way
be construed to amend or modify the provisions of the Letter Agreement.
15. Definitions.
-----------
15.1. Accrued Compensation. For purposes of this Agreement,
--------------------
"Accrued Compensation" shall mean all amounts of compensation for services
rendered to the Company or any other Affiliate that have been earned or accrued
through the Termination Date but that have not been paid as of the Termination
Date including (a) base salary, (b) reimbursement for reasonable and necessary
business expenses incurred by the Executive on behalf of the Company during the
period ending on the Termination Date, (c) vacation pay and (d) bonuses and
incentive compensation; provided, however, that Accrued Compensation shall not
include any amounts described in clause (a) or clause (d) that have been
deferred pursuant to any salary reduction or deferred compensation elections
made by the Executive.
15.2. Affiliate. For purposes of this Agreement, "Affiliate"
---------
means any entity, directly or indirectly, controlled by, controlling or under
common control with the Corporation or any corporation or other entity
acquiring, directly or indirectly, all or substantially all the assets and
business of the Corporation, whether by operation of law or otherwise.
15.3. Base Amount. For purposes of this Agreement, "Base Amount"
-----------
shall mean the Executive's annual base salary at the rate in effect as of the
date of a Change in Control or, if greater, at any time thereafter, determined
without regard to any salary reduction or deferred compensation elections made
by the Executive.
9
<PAGE>
15.4. Bonus Amount. For purposes of this Agreement, "Bonus
------------
Amount" shall mean the greater of (a) the target annual bonus payable to the
Executive under the Incentive Plan in respect of the fiscal year during which
the Termination Date occurs or (b) the highest annual bonus paid or payable
under the Incentive Plan in respect of any of the three full fiscal years ended
prior to the Termination Date or, if greater, the three (3) full fiscal years
ended prior to the Change in Control.
15.5. Cause. For purposes of this Agreement, a termination of
-----
employment is for "Cause" if the Executive has been convicted of a felony or the
termination is evidenced by a resolution adopted in good faith by two-thirds of
the Board of Directors of the Corporation that the Executive:
(a) intentionally and continually failed substantially to
perform his reasonably assigned duties with the Company or the Corporation
(other than a failure resulting from the Executive's incapacity due to physical
or mental illness or from the assignment to the Executive of duties that would
constitute Good Reason) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company or the Corporation, has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or
(b) intentionally engaged in conduct which is demonstrably
and materially injurious to the Corporation or the Company; provided, however,
that no termination of the Executive's employment shall be for Cause as set
forth in this Section 15.5(b) until (1) there shall have been delivered to the
Executive a copy of a written notice, signed by a duly authorized officer of the
Company or the Corporation, setting forth that the Executive was guilty of the
conduct set forth in this Section 15.5(b) and specifying the particulars thereof
in detail, and (2) the Executive shall have been provided an opportunity to be
heard in person by the Board of Directors of the Corporation (with the
assistance of the Executive's counsel if the Executive so desires).
No act, nor failure to act, on the Executive's part, shall
be considered "intentional" unless the Executive has acted, or failed to act,
with a lack of good faith and with a lack of reasonable belief that the
Executive's action or failure to act was in the best interest of the Corporation
and the Company. Notwithstanding anything contained in this Agreement to the
contrary, no failure to perform by the Executive
10
<PAGE>
after a Notice of Termination is given to the Company by the Executive shall
constitute Cause for purposes of this Agreement.
15.6. Change in Control. A "Change in Control" shall mean the occurrence
-----------------
during the term of the Agreement of:
(a) An acquisition (other than directly from the Corporation) of any
common stock of the Corporation ("Common Stock") or other voting securities of
the Corporation entitled to vote generally for the election of directors (the
"Voting Securities") by any "Person" (as the term person is used for purposes of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), immediately after which such Person has "Beneficial Ownership"
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of the then outstanding shares of Common Stock or the
combined voting power of the Corporation's then outstanding Voting Securities;
provided, however, in determining whether a Change in Control has occurred,
Voting Securities which are acquired in a Non-Control Acquisition (as
hereinafter defined) shall not constitute an acquisition which would cause a
Change in Control. A "Non-Control Acquisition" shall mean an acquisition by (i)
an employee benefit plan (or a trust forming a part thereof) maintained by (A)
the Corporation or (B) any corporation or other Person of which a majority of
its voting power or its voting equity securities or equity interest is owned,
directly or indirectly, by the Corporation (a "Subsidiary") (ii) the Corporation
or its Subsidiaries, or (iii) any Person in connection with a Non-Control
Transaction (as hereinafter defined);
(b) The individuals who, as of August 1, 1996, are members of the
Board of Directors of the Corporation (the "Incumbent Board"), cease for any
reason to constitute at least seventy percent (70%) of the members of the Board
of Directors of the Corporation; provided, however, that if the election, or
nomination for election by the Corporation's shareholders, of any new director
was approved by a vote of at least two-thirds of the Incumbent Board, such new
director shall, for purposes of this Agreement, be considered as a member of the
Incumbent Board; provided further, however, that no individual shall be
considered a member of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened "Election Contest" (as
described in Rule 14a-11 promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors of the Corporation (a "Proxy Contest") including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest; or
11
<PAGE>
(c) The consummation of:
(1) A merger, consolidation or reorganization with or into
the Corporation or in which securities of the Corporation are issued, unless
such merger, consolidation or reorganization is a "Non-Control Transaction." A
"Non-Control Transaction" shall mean a merger, consolidation or reorganization
with or into the Corporation or in which securities of the Corporation are
issued where:
(A) the shareholders of the Corporation, immediately
before such merger, consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or reorganization, at least
sixty percent (60%) of the combined voting power of the outstanding voting
securities of the corporation resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities immediately before such
merger, consolidation or reorganization,
(B) the individuals who were members of the Incumbent
Board immediately prior to the execution of the agreement providing for such
merger, consolidation or reorganization constitute at least seventy percent
(70%) of the members of the board of directors of the Surviving Corporation, or
a corporation beneficially directly or indirectly owning a majority of the
Voting Securities of the Surviving Corporation, and
(C) no Person other than (i) the Corporation, (ii) any
Subsidiary, (iii) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation, the Surviving Corporation, or
any Subsidiary, or (iv) any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of twenty percent (20%)
or more of the then outstanding Voting Securities or common stock of the
Corporation, has Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Surviving Corporation's then outstanding voting
securities or its common stock.
(2) A complete liquidation or dissolution of the
Corporation; o or
(3) The sale or other disposition of all or substantially
all of the assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
12
<PAGE>
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then outstanding
Common Stock or Voting Securities as a result of the acquisition of Common Stock
or Voting Securities by the Corporation which, by reducing the number of shares
of Common Stock or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of shares of Common Stock or Voting Securities by
the Corporation, and after such share acquisition by the Corporation, the
Subject Person becomes the Beneficial Owner of any additional shares of Common
Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
15.7. Company and Corporation. For purposes of this Agreement,
-----------------------
all references to the Company and the Corporation shall include their respective
Successors and Assigns.
15.8. Disability. For purposes of this Agreement, "Disability"
----------
shall mean a physical or mental infirmity which impairs the Executive's ability
to substantially perform his duties with the Company for six (6) consecutive
months, and within the time period set forth in a Notice of Termination given to
the Executive (which time period shall not be less than thirty (30) days), the
Executive shall not have returned to full-time performance of his duties;
provided, however, that if the Company's Voluntary Employees Beneficiary
Association Long Term Disability Income Plan, or any successor plan (the
"Disability Plan"), is then in effect, the Executive shall not be deemed
disabled for purposes of this Agreement unless the Executive is also eligible
for "Total Disability" (as defined in the Disability Plan) benefits (or similar
benefits in the event of a successor plan) under the Disability Plan.
15.9. Good Reason. (a) For purposes of this Agreement, "Good
-----------
Reason" shall mean the occurrence after a Change in Control of any of the
following events or conditions:
(1) a change in the Executive's status, title, position or
responsibilities (including reporting responsibilities) which, in the
Executive's reasonable judgment, represents an adverse change from his status,
title, position or responsibilities as in effect immediately prior thereto; the
assignment to the Executive of any duties or responsibilities which, in the
Executive's reasonable judgment, are inconsistent with his status,
13
<PAGE>
title, position or responsibilities; or any removal of the Executive from or
failure to reappoint or reelect him to any of such offices or positions, except
in connection with the termination of his employment for Disability, Cause, as a
result of his death or by the Executive other than for Good Reason;
(2) a reduction in the Executive's annual base salary below
the Base Amount;
(3) the relocation of the offices of the Company at which
the Executive is principally employed to a location more than twenty-five (25)
miles from the location of such offices immediately prior to such Change in
Control, or the Company's or the Corporation's requiring the Executive to be
based anywhere other than such offices, except to the extent the Executive was
not previously assigned to a principal location and except for required travel
on the Company's or the Corporation's business to an extent substantially
consistent with the Executive's business travel obligations at the time of the
Change in Control;
(4) the failure by the Company or the Corporation to pay to
the Executive any portion of the Executive's current compensation or to pay to
the Executive any portion of an installment of deferred compensation under any
deferred compensation program of the Company or the Corporation in which the
Executive participated, within seven (7) days of the date such compensation is
due;
(5) the failure by the Company or the Corporation to (A)
continue in effect (without reduction in benefit level, and/or reward
opportunities) any material compensation or employee benefit plan in which the
Executive was participating immediately prior to the Change in Control,
including, but not limited to, any of the plans listed in Appendix A hereto,
unless a substitute or replacement plan has been implemented which provides
substantially identical compensation or benefits to the Executive or (B) provide
the Executive with compensation and benefits, in the aggregate, at least equal
(in terms of benefit levels and/or reward opportunities) to those provided for
under each other compensation or employee benefit plan, program and practice in
which the Executive was participating immediately prior to the Change in
Control;
(6) the failure of the Company or the Corporation to obtain
from its Successors or Assigns the express assumption and agreements required
under Section 11 hereof; or
14
<PAGE>
(7) any purported termination of the Executive's employment
by the Company which is not effected pursuant to a Notice of Termination
satisfying the terms set forth in the definition of Notice of Termination (and,
if applicable, the terms set forth in the definition of Cause).
(b) Any event or condition (1) described in Section
15.9(a)(1), (2), (3), (4), (6) or (7) which occurs within twelve (12) months
prior to a Change in Control or (2) described in Section 15.9(a)(1) through (7)
which occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a Third Party who effectuates a Change in
Control or (B) otherwise arose in connection with, or in anticipation of a
Change in Control which has been threatened or proposed and which actually
occurs, shall constitute Good Reason for purposes of this Agreement
notwithstanding that it occurred prior to a Change in Control.
15.10. Incentive Plan. For purposes of this Agreement,
--------------
"Incentive Plan" shall mean the Incentive Compensation Plan for Elected
Officers, or any successor annual incentive plan, maintained by the Company or
any other Affiliate.
15.11. Notice of Termination. For purposes of this Agreement,
---------------------
following a Change in Control, "Notice of Termination" shall mean a written
notice of termination of the Executive's employment, signed by the Executive if
to the Company or by a duly authorized officer of the Company if to the
Executive, which indicates the specific termination provision in this Agreement,
if any, relied upon and which sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.
15.12. Pro Rata Bonus. For purposes of this Agreement,
--------------
"Pro Rata Bonus" shall mean an amount equal to the Bonus Amount multiplied by a
fraction the numerator of which is the number of days in such fiscal year
through the Termination Date and the denominator of which is 365; provided,
however, that the Pro Rata Bonus shall be reduced, but not below zero, to the
extent of any bonus the Executive is entitled to receive pursuant to the
Incentive Plan in respect of the fiscal year (denoted a "Performance Period"
under the Incentive Plan) in which the Termination Date occurs.
15.13. Successors and Assigns. For purposes of this Agreement,
----------------------
"Successors and Assigns" shall mean, with respect to the Company or the
Corporation, a corporation or other entity acquiring all or substantially all
the assets and business of the
15
<PAGE>
Company or the Corporation, as the case may be (including this Agreement)
whether by operation of law or otherwise.
15.14 Termination Date.
----------------
(a) For purposes of this Agreement, "Termination Date"
shall mean (i) in the case of the Executive's death, his date of death, (ii) if
the Executive's employment is terminated for Disability, thirty (30) days after
Notice of Termination is given (provided that the Executive shall not have
returned to the performance of his duties on a full-time basis during such
thirty (30) day period) and (iii) if the Executive's employment is terminated
for any other reason, the date specified in the Notice of Termination (which, in
the case of a termination for Cause shall not be less than thirty (30) days, and
in the case of a termination for Good Reason shall not be more than sixty (60)
days, from the date such Notice of Termination is given); provided, however,
that if within thirty (30) days after a Notice of Termination by the Company for
Cause or a Notice of Termination by the Executive for Good Reason is given the
party receiving such Notice of Termination in good faith notifies the other
party that a dispute exists concerning the basis for the termination, the
provisions of paragraph (b) shall apply.
(b) (i) If the Executive gives the Company Notice of
Termination for Good Reason and the Company disputes the basis for the
termination, the Termination Date shall be the date on which the dispute is
finally determined, either by mutual written agreement of the parties, or by the
final judgment, order or decree of a court of competent jurisdiction (the time
for appeal therefrom having expired and no appeal having been taken) and the
Company shall continue to pay the Executive his Base Amount and continue the
Executive as a participant in all compensation, incentive, bonus, pension,
profit sharing, medical, hospitalization, dental, life insurance and disability
benefit plans in which he was participating when the notice giving rise to the
dispute was given, until such Termination Date, provided that if the Executive
continues to perform his duties with the Company during the pendency of such
dispute, the Executive shall not be obligated to repay to the Company any
amounts paid or benefits provided pursuant to this Section 15.14(b), and further
provided that if the Executive ceased performing his duties with the Company
during the pendency of such dispute, and the dispute is resolved in favor of the
Executive, any amount owed to the Executive pursuant to Section 2 of this
Agreement shall be reduced to the extent of any amount the Executive received
pursuant to this Section 15.14(b) during the pendency of such dispute; and (ii)
if the
16
<PAGE>
Company gives the Executive Notice of Termination for Cause and the Executive
disputes the basis for the termination, the Termination Date shall be as
determined pursuant to Section 15.14(a) and during the pendency of such dispute
the Executive shall not be entitled to payment of his Base Amount from the
Company and, except as required by law, the Executive's participation in the
Company's benefit plans and programs shall be discontinued.
17
<PAGE>
IN WITNESS WHEREOF, the Corporation and the Company have caused this
Agreement to be executed by their duly authorized officers and the Executive has
executed this Agreement as of the day and year first above written.
GPU, Inc.
By:___________________________
ATTEST: Fred D. Hafer
Chairman, President and Chief
Executive Officer
- -------------------------
Secretary
GPU Service, Inc.
By:___________________________
ATTEST: Fred D. Hafer
Chairman, President and Chief
Executive Officer
- ------------------------
Secretary
By:___________________________
Ira H. Jolles
18
<PAGE>
APPENDIX A
1. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
2. The Company's Incentive Plan
3. The GPU Companies Deferred Compensation Plan
4. The GPU Companies Employee Pension Plan
5. The Company's Supplemental and Excess Benefits Plan
6. The Company's Employee Life Insurance Plan
7. Senior Executive Split-Dollar Life Insurance Program
8. The GPU Companies Accident Insurance Plan
9. The GPU Companies Health Care Plan for Non-Bargaining Employees and
the Company's Health Care Plan for Non-bargaining Retirees, if
applicable
10. The GPU Companies Supplemental Medical Expense Plan for Elected
Officers
11. The GPU Companies Flexible Benefits Plan for Non-bargaining Employees
12. The GPU Companies Group Specified Disease Insurance Plan
13. The GPU Companies Long Term Disability Income Plan
14. The GPU Companies Employee Savings Plan
15. The Company's Vacation Policy for Non-Bargaining Unit Employees
19
<PAGE>
EXHIBIT C-26
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 5th day of November, 1998, by and
--- --------------
among GPU, Inc. (the "Corporation"), GPU Nuclear, Inc. (the "Company") and
Thomas G. Broughton (the "Executive") amends and restates the former Severance
- -------------------
Protection Agreement dated June 5, 1997 by and among the Corporation, the
------------
Company and the Executive (the "Former Agreement").
WHEREAS, the Board of Directors of the Corporation and the Board
of Directors of the Company (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation;
WHEREAS, the Boards have determined that it is essential and in
the best interest of the Company, and the Corporation and its stockholders, for
the Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the
employ of the Company, particularly in the event of a threat or the occurrence
of a Change in Control, the Company desires to enter into this Agreement with
the Executive to provide the Executive with certain benefits in the event the
Executive's employment is terminated as a result of, or in connection with, a
Change in Control.
NOW, THEREFORE, in consideration of the respective agreements of
the parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of
-----------------
November 5, 1998, and shall continue in effect until October
31, 2000 (the "Term"); provided, however, that on November
1, 1999, and on each November 1 thereafter, the Term shall
automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to
the other at least ninety (90) days prior thereto that the
Term shall not be so extended; provided, further, however,
that following the occurrence of a Change in Control, the
Term shall not expire prior to the expiration of twenty-four
(24) months after such occurrence.
<PAGE>
2. Termination of Employment. If the Executive's employment
-------------------------
with the Company and with all other Affiliates of the
Corporation shall be terminated within twenty-four (24)
months following a Change in Control, the Executive shall be
entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and
with all other Affiliates of the Corporation shall be terminated for any reason
the Company shall pay to the Executive his Accrued Compensation. In addition to
the foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and
with all other Affiliates of the Corporation shall be terminated(i) by the
Company without Cause (other than by reason of the Executive's Disability), or
(ii) by the Executive for Good Reason, the Executive shall be entitled to the
following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance
pay and in lieu of any further compensation for periods subsequent to the
Termination Date, an amount determined by multiplying (A) three (3) times the
sum of (i) the Executive's Base Amount and (ii) the Executive's Bonus Amount, by
(B) a fraction, the numerator of which is the number of months, not to exceed
thirty-six (36), in the period beginning on the Termination Date and ending on
the Executive's Normal Retirement Date (as defined in the Company's Employee
Pension Plan), and the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36),
or if earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the Executive immediately
prior to the Change in Control or, if greater, the coverages and benefits
provided at any time thereafter. The coverages and benefits (including
deductibles and costs) provided in this Section 2(b)(3) during the Continuation
Period shall be no less favorable to the Executive and his dependents and
beneficiaries, than the most favorable of such coverages and benefits referred
to above. The Company's obligation hereunder with respect to the foregoing
coverages and benefits shall be reduced to the extent that the Executive obtains
any such coverages and benefits pursuant to a
2
<PAGE>
subsequent employer's benefit plans, in which case the Company may reduce any of
the coverages or benefits it is required to provide the Executive hereunder so
long as the aggregate coverages and benefits of the combined benefit plans is no
less favorable to the Executive than the coverages and benefits required to be
provided hereunder. This Section 2(b)(3) shall not be interpreted so as to limit
any benefits to which the Executive, his dependents or beneficiaries may be
entitled under any of the Company's employee benefit plans, programs or
practices following the Executive's termination of employment, including without
limitation, retiree medical and life insurance benefits;
(4) the Company shall pay or reimburse the Executive
for the costs, fees and expenses of outplacement assistance services (not to
exceed twenty percent (20%) of the sum of (A) the Executive's Base Amount and
(B) the Executive's Bonus Amount) provided by any outplacement agency selected
by the Executive; and
(5) the Company shall provide to the Executive the
use of a Company-leased vehicle, at no cost to the Executive, until the earlier
of (A) the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the
Company without Cause (other than by reason of the Executive's Disability) (1)
within twelve (12) months prior to a Change in Control or (2) any time prior to
the date of a Change in Control but the Executive reasonably demonstrates that
such termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control which has been
threatened or proposed such termination shall be deemed to have occurred after a
Change in Control, provided a Change in Control shall actually have occurred.
(d) (1) Gross-Up Payment. In the event it shall be
----------------
determined that any payment or distribution of any type to or for the benefit of
the Executive, by the Company, the Corporation, any Affiliate, any Person (as
defined in Section 15.6(a) hereof) who acquires ownership or effective control
of the Corporation or ownership of a substantial portion of the Corporation's
assets (within the meaning of Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder) or any affiliate of
such Person, whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise (the "Total Payments"), is
3
<PAGE>
or will be subject to the excise tax imposed by Section 4999 of the Code or any
interest or penalties with respect to such excise tax (such excise tax, together
with any such interest and penalties, are collectively referred to as the
"Excise Tax"), then the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with respect
to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive, absent manifest error. As a
result of uncertainty in the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm hereunder, it is possible
that Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment or Overpayment
that has occurred. In the case of an Underpayment,
4
<PAGE>
the amount of the Underpayment shall be promptly paid by the Company to or for
the benefit of the Executive. In the case of an Overpayment, the Executive
shall, at the direction and expense of the Company, take such steps as are
reasonably necessary (including the filing of returns and claims for refund),
follow reasonable instructions from, and procedures established by, the Company,
and otherwise reasonably cooperate with the Company to correct such Overpayment,
provided, however, that (i) the Executive shall not in any event be obligated to
return to the Company an amount greater than the net after-tax portion of the
Overpayment that he has retained or has recovered as a refund from the
applicable taxing authorities and (ii) this provision shall be interpreted in a
manner consistent with the intent of Section 2(d)(1), which is to make the
Executive whole, on an after-tax basis, from the application of the Excise Tax,
it being understood that the correction of an Overpayment may result in the
Executive repaying to the Company an amount which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1),
(2) and (4) shall be paid in a single lump sum cash payment within thirty (30)
days after the Executive's Termination Date (or earlier, if required by
applicable law).
(f) The Executive shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other employment
or otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
(g) The severance pay and benefits provided for in this
Section 2 shall be in lieu of any other severance pay to which the Executive may
be entitled under the GPU System Severance Procedure or any other plan,
agreement or arrangement of the Company or any other Affiliate of the
Corporation.
(h) The Executive's entitlement to other compensation or
benefits pursuant to the Company's employee benefit plans and other applicable
programs and practices shall be determined in accordance with the terms of those
plans, programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i)
---------------------
any intended termination of the Executive's employment by the Company shall be
communicated by a Notice of Termination from the Company to the Executive, and
(ii) any intended termination of the Executive's employment by the Executive for
Good Reason shall be communicated by a Notice of Termination from the Executive
to the Company within six (6)
5
<PAGE>
months of the Executive becoming aware of the event or action constituting Good
Reason or, if later, within six (6) months after the date of the Change in
Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under this Agreement if (a) the Executive's
employment with the Company terminates as a result of the transfer of his
employment to any other Affiliate of the Corporation, (b) this Agreement is
assigned to such other Affiliate, and (c) such other Affiliate expressly assumes
and agrees to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no assignment had taken
place. Any Affiliate to which this Agreement is so assigned shall be treated as
the "Company" for all purposes of this Agreement on or after the date as of
which such assignment to the Affiliate, and the Affiliate's assumption and
agreement to so perform this Agreement, becomes effective.
6. Corporation's Obligation. The Corporation agrees that it
------------------------
will take such steps as may be necessary to cause the Company (or any Affiliate
that has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
6
<PAGE>
7. Notice. For the purposes of this Agreement, notices and all
------
other communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a
----------------
mere unsecured creditor of the Company and the Corporation with respect to his
right to receive any payment under this Agreement. This Agreement shall
constitute a mere promise by the Company and the Corporation to make payments in
the future of the benefits provided for herein. It is the intention of the
parties hereto that the arrangements reflected in this Agreement shall be
treated as unfunded for tax purposes and, if it should be determined that Title
I of ERISA is applicable to this Agreement, for purposes of Title I of ERISA.
Except as provided in Section 2(g), nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit, bonus,
incentive or other plan or program provided by the Company, the Corporation or
any other Affiliate of the Corporation and for which the Executive may qualify,
nor shall anything herein limit or reduce such rights as the Executive may have
under any other agreements with the Company, the Corporation or any other
Affiliate of the Corporation. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of the
Company, the Corporation or any other Affiliate of the Corporation shall be
payable in accordance with such plan or program, except as explicitly modified
by this Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, defense, recoupment, or other right which
the Company may have against the Executive or others.
10. Miscellaneous. No provision of this Agreement may be
-------------
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by
7
<PAGE>
the Executive, the Corporation and the Company. No waiver by any party hereto at
any time of any breach by any other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreement or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by any party which are not expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to
the benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest
hereunder shall be assignable or transferable by the Executive, his
beneficiaries or legal representatives, except by will or by the laws of descent
and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive's legal personal representative.
12. Governing Law. This Agreement shall be governed by and
-------------
construed and enforced in accordance with the laws of the State of New Jersey
without giving effect to the conflict of laws principles thereof. Any action
brought by any party to this Agreement shall be brought and maintained in a
court of competent jurisdiction in Morris County in the State of New Jersey.
13. Severability. The provisions of this Agreement shall be
------------
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire
----------------
agreement between the parties hereto, and supersedes all prior agreements, if
any, understandings and arrangements, oral or written, between the parties
hereto, with respect to the subject matter hereof, including the Former
Agreement and the Executive agrees that the Former Agreement is terminated and
shall have no further force or effect.
8
<PAGE>
15. Definitions.
-----------
15.1. Accrued Compensation. For purposes of this
--------------------
Agreement, "Accrued Compensation" shall mean all amounts of compensation for
services rendered to the Company or any other Affiliate that have been earned or
accrued through the Termination Date but that have not been paid as of the
Termination Date including (a) base salary, (b) reimbursement for reasonable and
necessary business expenses incurred by the Executive on behalf of the Company
during the period ending on the Termination Date, (c) vacation pay and (d)
bonuses and incentive compensation; provided, however, that Accrued Compensation
shall not include any amounts described in clause (a) or clause (d) that have
been deferred pursuant to any salary reduction or deferred compensation
elections made by the Executive.
15.2. Affiliate. For purposes of this Agreement,
---------
"Affiliate" means any entity, directly or indirectly, controlled by, controlling
or under common control with the Corporation or any corporation or other entity
acquiring, directly or indirectly, all or substantially all the assets and
business of the Corporation, whether by operation of law or otherwise.
15.3 Base Amount. For purposes of this Agreement,
-----------
"Base Amount" shall mean the Executive's annual base salary at the rate in
effect as of the date of a Change in Control or, if greater, at any time
thereafter, determined without regard to any salary reduction or deferred
compensation elections made by the Executive.
15.4 Bonus Amount. For purposes of this Agreement,
------------
"Bonus Amount" shall mean the greater of (a) the target annual bonus payable to
the Executive under the Incentive Plan in respect of the fiscal year during
which the Termination Date occurs or (b) the highest annual bonus paid or
payable under the Incentive Plan in respect of any of the three full fiscal
years ended prior to the Termination Date or, if greater, the three (3) full
fiscal years ended prior to the Change in Control.
15.5. Cause. For purposes of this Agreement, a
-----
termination of employment is for "Cause" if the Executive has been convicted of
a felony or the termination is evidenced by a resolution adopted in good faith
by two-thirds of the Board of Directors of the Corporation that the Executive:
(a) intentionally and continually failed
substantially to perform his reasonably assigned duties with the Company or the
Corporation (other than a failure resulting from the Executive's incapacity due
to physical or mental illness or from the assignment to the Executive of duties
that would
9
<PAGE>
constitute Good Reason) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company or the Corporation, has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or
(b) intentionally engaged in conduct which is demonstrably and
materially injurious to the Corporation or the Company; provided, however, that
no termination of the Executive's employment shall be for Cause as set forth in
this Section 15.5(b) until (1) there shall have been delivered to the Executive
a copy of a written notice, signed by a duly authorized officer of the Company
or the Corporation, setting forth that the Executive was guilty of the conduct
set forth in this Section 15.5(b) and specifying the particulars thereof in
detail, and (2) the Executive shall have been provided an opportunity to be
heard in person by the Board of Directors of the Corporation (with the
assistance of the Executive's counsel if the Executive so desires).
No act, nor failure to act, on the Executive's part, shall be
considered "intentional" unless the Executive has acted, or failed to act, with
a lack of good faith and with a lack of reasonable belief that the Executive's
action or failure to act was in the best interest of the Corporation and the
Company. Notwithstanding anything contained in this Agreement to the contrary,
no failure to perform by the Executive after a Notice of Termination is given to
the Company by the Executive shall constitute Cause for purposes of this
Agreement.
15.6. Change in Control. A "Change in Control" shall mean the
-----------------
occurrence during the term of the Agreement of:
(a) An acquisition (other than directly from the Corporation) of
any common stock of the Corporation ("Common Stock") or other voting securities
of the Corporation entitled to vote generally for the election of directors (the
"Voting Securities") by any "Person" (as the term person is used for purposes of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), immediately after which such Person has "Beneficial Ownership"
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of the then outstanding shares of Common Stock or the
combined voting power of the Corporation's then outstanding Voting Securities;
provided, however, in determining whether a Change in Control has occurred,
Voting Securities which are acquired in a Non-Control Acquisition (as
hereinafter defined) shall not constitute an acquisition which would cause a
Change in Control. A "Non-Control Acquisition" shall mean an
10
<PAGE>
acquisition by (i) an employee benefit plan (or a trust forming a part thereof)
maintained by (A) the Corporation or (B) any corporation or other Person of
which a majority of its voting power or its voting equity securities or equity
interest is owned, directly or indirectly, by the Corporation (a "Subsidiary")
(ii) the Corporation or its Subsidiaries, or (iii) any Person in connection with
a Non-Control Transaction (as hereinafter defined);
(b) The individuals who, as of August 1, 1996, are members of
the Board of Directors of the Corporation (the "Incumbent Board"), cease for any
reason to constitute at least seventy percent (70%) of the members of the Board
of Directors of the Corporation; provided, however, that if the election, or
nomination for election by the Corporation's shareholders, of any new director
was approved by a vote of at least two-thirds of the Incumbent Board, such new
director shall, for purposes of this Agreement, be considered as a member of the
Incumbent Board; provided further, however, that no individual shall be
considered a member of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened "Election Contest" (as
described in Rule 14a-11 promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors of the Corporation (a "Proxy Contest") including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest; or
(c) The consummation of:
(1) A merger, consolidation or reorganization with or
into the Corporation or in which securities of the Corporation are issued,
unless such merger, consolidation or reorganization is a "Non-Control
Transaction." A "Non-Control Transaction" shall mean a merger, consolidation or
reorganization with or into the Corporation or in which securities of the
Corporation are issued where:
(A) the shareholders of the Corporation,
immediately before such merger, consolidation or reorganization, own directly or
indirectly immediately following such merger, consolidation or reorganization,
at least sixty percent (60%) of the combined voting power of the outstanding
voting securities of the corporation resulting from such merger or consolidation
or reorganization (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities immediately before such
merger, consolidation or reorganization,
11
<PAGE>
(B) the individuals who were members of the
Incumbent Board immediately prior to the execution of the agreement providing
for such merger, consolidation or reorganization constitute at least seventy
percent (70%) of the members of the board of directors of the Surviving
Corporation, or a corporation beneficially directly or indirectly owning a
majority of the Voting Securities of the Surviving Corporation, and
(C) no Person other than (i) the Corporation, (ii)
any Subsidiary, (iii) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation, the Surviving Corporation, or
any Subsidiary, or (iv) any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of twenty percent (20%)
or more of the then outstanding Voting Securities or common stock of the
Corporation, has Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Surviving Corporation's then outstanding voting
securities or its common stock.
(2) A complete liquidation or dissolution of the
Corporation; or
(3) The sale or other disposition of all or substantially
all of the assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then outstanding
common stock or Voting Securities as a result of the acquisition of Common Stock
or Voting Securities by the Corporation which, by reducing the number of shares
of Common Stock or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of shares of Common Stock or Voting Securities by
the Corporation, and after such share acquisition by the Corporation, the
Subject Person becomes the Beneficial Owner of any additional shares of Common
Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
15.7. Company and Corporation. For purposes of this Agreement, all
-----------------------
references to the Company and the Corporation shall include their respective
Successors and Assigns.
12
<PAGE>
15.8. Disability. For purposes of this Agreement, "Disability" shall
----------
mean a physical or mental infirmity which impairs the Executive's ability to
substantially perform his duties with the Company for six (6) consecutive
months, and within the time period set forth in a Notice of Termination given to
the Executive (which time period shall not be less than thirty (30) days), the
Executive shall not have returned to full-time performance of his duties;
provided, however, that if the Company's Voluntary Employees Beneficiary
Association Long Term Disability Income Plan, or any successor plan (the
"Disability Plan"), is then in effect, the Executive shall not be deemed
disabled for purposes of this Agreement unless the Executive is also eligible
for "Total Disability" (as defined in the Disability Plan) benefits (or similar
benefits in the event of a successor plan) under the Disability Plan.
15.9. Good Reason. (a) For purposes of this Agreement, "Good Reason"
-----------
shall mean the occurrence after a Change in Control of any of the following
events or conditions:
(1) a change in the Executive's status, title, position or
responsibilities (including reporting responsibilities) which, in the
Executive's reasonable judgment, represents an adverse change from his status,
title, position or responsibilities as in effect immediately prior thereto; the
assignment to the Executive of any duties or responsibilities which, in the
Executive's reasonable judgment, are inconsistent with his status, title,
position or responsibilities; or any removal of the Executive from or failure to
reappoint or reelect him to any of such offices or positions, except in
connection with the termination of his employment for Disability, Cause, as a
result of his death or by the Executive other than for Good Reason;
(2) a reduction in the Executive's annual base salary below the
Base Amount;
(3) the relocation of the offices of the Company at which the
Executive is principally employed to a location more than twenty-five (25) miles
from the location of such offices immediately prior to such Change in Control,
or the Company's or the Corporation's requiring the Executive to be based
anywhere other than such offices, except to the extent the Executive was not
previously assigned to a principal location and except for required travel on
the Company's or the Corporation's business to an extent substantially
consistent with the Executive's business travel obligations at the time of the
Change in Control;
13
<PAGE>
(4) the failure by the Company or the Corporation to pay to the
Executive any portion of the Executive's current compensation or to pay to the
Executive any portion of an installment of deferred compensation under any
deferred compensation program of the Company in which the Executive
participated, within seven (7) days of the date such compensation is due;
(5) the failure by the Company or the Corporation to (A)
continue in effect (without reduction in benefit level, and/or reward
opportunities) any material compensation or employee benefit plan in which the
Executive was participating immediately prior to the Change in Control,
including, but not limited to, any of the plans listed in Appendix A hereto,
unless a substitute or replacement plan has been implemented which provides
substantially identical compensation or benefits to the Executive or (B) provide
the Executive with compensation and benefits, in the aggregate, at least equal
(in terms of benefit levels and/or reward opportunities) to those provided for
under each other compensation or employee benefit plan, program and practice in
which the Executive was participating immediately prior to the Change in
Control;
(6) the failure of the Company or the Corporation to obtain from
its Successors or Assigns the express assumption and agreements required under
Section 11 hereof; or
(7) any purported termination of the Executive's employment by
the Company which is not effected pursuant to a Notice of Termination satisfying
the terms set forth in the definition of Notice of Termination (and, if
applicable, the terms set forth in the definition of Cause).
(b) Any event or condition (1) described in Section
15.9(a)(1), (2), (3), (4), (6) or (7) which occurs within twelve (12) months
prior to a Change in Control or (2) described in Section 15.9(a)(1) through (7)
which occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a Third Party who effectuates a Change in
Control or (B) otherwise arose in connection with, or in anticipation of a
Change in Control which has been threatened or proposed and which actually
occurs, shall constitute Good Reason for purposes of this Agreement
notwithstanding that it occurred prior to a Change in Control.
15.10. Incentive Plan. For purposes of this Agreement, "Incentive Plan"
--------------
shall mean the Incentive Compensation Plan for Elected Officers, or any
successor annual incentive plan, maintained by the Company or any other
Affiliate.
14
<PAGE>
15.11. Notice of Termination. For purposes of this Agreement, following
---------------------
a Change in Control, "Notice of Termination" shall mean a written notice of
termination of the Executive's employment, signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive,
which indicates the specific termination provision in this Agreement, if any,
relied upon and which sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.
15.12. Pro Rata Bonus. For purposes of this Agreement, "Pro Rata Bonus"
--------------
shall mean an amount equal to the Bonus Amount multiplied by a fraction the
numerator of which is the number of days in such fiscal year through the
Termination Date and the denominator of which is 365; provided, however, that
the Pro Rata Bonus shall be reduced, but not below zero, to the extent of any
bonus the Executive is entitled to receive pursuant to the Incentive Plan in
respect of the fiscal year (denoted a "Performance Period" under the Incentive
Plan) in which the Termination Date occurs.
15.13. Successors and Assigns. For purposes of this Agreement,
----------------------
"Successors and Assigns" shall mean, with respect to the Company or the
Corporation, a corporation or other entity acquiring all or substantially all
the assets and business of the Company or the Corporation, as the case may be
(including this Agreement) whether by operation of law or otherwise.
15.14 Termination Date
----------------
(a) For purposes of this Agreement, "Termination Date" shall
mean (i) in the case of the Executive's death, his date of death, (ii) if the
Executive's employment is terminated for Disability, thirty (30) days after
Notice of Termination is given (provided that the Executive shall not have
returned to the performance of his duties on a full-time basis during such
thirty (30) day period) and (iii) if the Executive's employment is terminated
for any other reason, the date specified in the Notice of Termination (which, in
the case of a termination for Cause shall not be less than thirty (30) days, and
in the case of a termination for Good Reason shall not be more than sixty (60)
days, from the date such Notice of Termination is given); provided, however,
that if within thirty (30) days after a Notice of Termination by the Company for
Cause or a Notice of Termination by the Executive for Good Reason is given the
party receiving such Notice of Termination in good faith notifies the other
party that a dispute exists concerning the basis for the termination, the
provisions of paragraph (b) shall apply.
15
<PAGE>
(b)(i) If the Executive gives the Company Notice of Termination
for Good Reason and the Company disputes the basis for the termination, the
Termination Date shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, or by the final judgment,
order or decree of a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been taken) and the Company shall
continue to pay the Executive his Base Amount and continue the Executive as a
participant in all compensation, incentive, bonus, pension, profit sharing,
medical, hospitalization, dental, life insurance and disability benefit plans in
which he was participating when the notice giving rise to the dispute was given,
until such Termination Date, provided that if the Executive continues to perform
his duties with the Company during the pendency of such dispute, the Executive
shall not be obligated to repay to the Company any amounts paid or benefits
provided pursuant to this Section 15.14(b), and further provided that if the
Executive ceased performing his duties with the Company during the pendency of
such dispute, and the dispute is resolved in favor of the Executive, any amount
owed to the Executive pursuant to Section 2 of this Agreement shall be reduced
to the extent of any amount the Executive received pursuant to this Section
15.14(b) during the pendency of such dispute; and (ii) if the Company gives the
Executive Notice of Termination for Cause and the Executive disputes the basis
for the termination, the Termination Date shall be as determined pursuant to
Section 15.14(a) and during the pendency of such dispute the Executive shall not
be entitled to payment of his Base Amount from the Company and, except as
required by law, the Executive's participation in the Company's benefit plans
and programs shall be discontinued.
16
<PAGE>
IN WITNESS WHEREOF, the Corporation and the Company have caused
this Agreement to be executed by their duly authorized officers and the
Executive has executed this Agreement as of the day and year first above
written.
GPU, Inc.
By:__________________________
ATTEST: Fred D. Hafer
Chairman, President and
Chief Executive Officer
__________________________
Secretary
GPU Nuclear, Inc.
By:__________________________
ATTEST: Fred D. Hafer
Chairman of the Board
__________________________
Secretary
By:__________________________
Thomas G. Broughton
17
<PAGE>
APPENDIX A
1. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
2. The Company's Incentive Plan
3. The GPU Companies Deferred Compensation Plan
4. The GPU Companies Employee Pension Plan
5. The Company's Supplemental and Excess Benefits Plan
6. The Company's Employee Life Insurance Plan
7. Senior Executive Split-Dollar Life Insurance Program
8. The GPU Companies Accident Insurance Plan
9. The GPU Companies Health Care Plan for Non-Bargaining Employees and the
Company's Health Care Plan for Non-bargaining Retirees, if applicable
10. The GPU Companies Supplemental Medical Expense Plan for Elected
Officers
11. The GPU Companies Flexible Benefits Plan for Non-bargaining Employees
12. The GPU Companies Group Specified Disease Insurance Plan
13. The GPU Companies Long Term Disability Income Plan
14. The GPU Companies Employee Savings Plan
15. The Company's Vacation Policy for Non-Bargaining Unit Employees
18
<PAGE>
EXHIBIT C-27
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 30th day of November, 1998, by and
---------- --------------
among GPU, Inc. (the "Corporation"), GPU Service, Inc. (the "Company") and
Carole B. Snyder (the "Executive").
- ----------------
WHEREAS, the Board of Directors of the Corporation and the Board of
Directors of the Company (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation;
WHEREAS, the Boards have determined that it is essential and in the
best interest of the Company, and the Corporation and its stockholders, for the
Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Company, particularly in the event of a threat or the occurrence of a Change
in Control, the Company desires to enter into this Agreement with the Executive
to provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of November
-----------------
30, 1998, and shall continue in effect until October 31, 2000 (the "Term");
provided, however, that on November 1, 1999, and on each November 1 thereafter,
the Term shall automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to the other at least
ninety (90) days prior thereto that the Term shall not be so extended; provided,
further, however, that following the occurrence of a Change in Control, the Term
shall not expire prior to the expiration of twenty-four (24) months after such
occurrence.
<PAGE>
2. Termination of Employment. If the Executive's employment with the
-------------------------
Company and with all other Affiliates of the Corporation shall be terminated
within twenty-four (24) months following a Change in Control, the Executive
shall be entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated for any reason, the
Company shall pay to the Executive his Accrued Compensation. In addition to the
foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated (i) by the Company
without Cause (other than by reason of the Executive's Disability), or (ii) by
the Executive for Good Reason, the Executive shall be entitled to the following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance pay and
in lieu of any further compensation for periods subsequent to the Termination
Date, an amount determined by multiplying (A) three (3) times the sum of (i) the
Executive's Base Amount and (ii) the Executive's Bonus Amount, by (B) a
fraction, the numerator of which is the number of months, not to exceed thirty-
six (36), in the period beginning on the Termination Date and ending on the
Executive's Normal Retirement Date (as defined in the Company's Employee Pension
Plan), and the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36), or if
earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the Executive immediately
prior to the Change in Control or, if greater, the coverages and benefits
provided at any time thereafter. The coverages and benefits (including
deductibles and costs) provided in this Section 2(b)(3) during the Continuation
Period shall be no less favorable to the Executive and his dependents and
beneficiaries, than the most favorable of such coverages and benefits referred
to above. The Company's obligation hereunder with respect to the foregoing
coverages and benefits shall be reduced to the extent that the Executive obtains
any such coverages and benefits pursuant to a
2
<PAGE>
subsequent employer's benefit plans, in which case the Company may reduce any of
the coverages or benefits it is required to provide the Executive hereunder so
long as the aggregate coverages and benefits of the combined benefit plans is no
less favorable to the Executive than the coverages and benefits required to be
provided hereunder. This Section 2(b)(3) shall not be interpreted so as to limit
any benefits to which the Executive, his dependents or beneficiaries may be
entitled under any of the Company's employee benefit plans, programs or
practices following the Executive's termination of employment, including without
limitation, retiree medical and life insurance benefits;
(4) the Company shall pay or reimburse the Executive for the
costs, fees and expenses of outplacement assistance services (not to exceed
twenty percent (20%) of the sum of (A) the Executive's Base Amount and (B) the
Executive's Bonus Amount) provided by any outplacement agency selected by the
Executive; and
(5) the Company shall provide to the Executive the use of a
Company-leased vehicle, at no cost to the Executive, until the earlier of (A)
the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the Company
without Cause (other than by reason of the Executive's Disability) (1) within
twelve (12) months prior to a Change in Control or (2) any time prior to the
date of a Change in Control but the Executive reasonably demonstrates that such
termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control which has been
threatened or proposed such termination shall be deemed to have occurred after a
Change in Control, provided a Change in Control shall actually have occurred.
(d) (1) Gross-Up Payment. In the event it shall be determined
----------------
that any payment or distribution of any type to or for the benefit of the
Executive, by the Company, the Corporation, any Affiliate, any Person (as
defined in Section 15.6(a) hereof) who acquires ownership or effective control
of the Corporation or ownership of a substantial portion of the Corporation's
assets (within the meaning of Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder) or any affiliate of
such Person, whether
3
<PAGE>
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise (the "Total Payments"), is or will be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax, imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive, absent manifest error. As a
result of uncertainty in the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm hereunder, it is possible
that Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should
4
<PAGE>
not have been made ("Overpayments"). In either such event, the Accounting Firm
shall determine the amount of the Underpayment or Overpayment that has occurred.
In the case of an Underpayment, the amount of such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive. In the case
of an Overpayment, the Executive shall, at the direction and expense of the
Company, take such steps as are reasonably necessary (including the filing of
returns and claims for refund), follow reasonable instructions from, and
procedures established by, the Company, and otherwise reasonably cooperate with
the Company to correct such Overpayment, provided, however, that (i) the
Executive shall not in any event be obligated to return to the Company an amount
greater than the net after-tax portion of the Overpayment that he has retained
or has recovered as a refund from the applicable taxing authorities and (ii)
this provision shall be interpreted in a manner consistent with the intent of
Section 2(d)(1), which is to make the Executive whole, on an after-tax basis,
from the application of the Excise Tax, it being understood that the correction
of an Overpayment may result in the Executive repaying to the Company an amount
which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1), (2) and
(4) shall be paid in a single lump sum cash payment within thirty (30) days
after the Executive's Termination Date (or earlier, if required by applicable
law).
(f) The Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
(g) The severance pay and benefits provided for in this Section 2
shall be in lieu of any other severance pay to which the Executive may be
entitled under the GPU System Severance Procedure or any other plan, agreement
or arrangement of the Company or any other Affiliate of the Corporation.
(h) The Executive's entitlement to other compensation or benefits,
pursuant to the Company's employee benefit plans and other applicable programs
and practices shall be determined in accordance with the terms of those plans,
programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i) any
---------------------
intended termination of the Executive's employment by the Company shall be
communicated by a Notice of Termination from the Company to the Executive, and
(ii) any
5
<PAGE>
intended termination of the Executive's employment by the Executive for Good
Reason shall be communicated by a Notice of Termination from the Executive to
the Company within six (6) months of the Executive becoming aware of the event
or action constituting Good Reason or, if later, within six (6) months after the
date of the Change in Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under this Agreement if (a) the Executive's
employment with the Company terminates as a result of the transfer of his
employment to any other Affiliate of the Corporation, (b) this Agreement is
assigned to such other Affiliate, and (c) such other Affiliate expressly assumes
and agrees to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no assignment had taken
place. Any Affiliate to which this Agreement is so assigned shall be treated as
the "Company" for all purposes of this Agreement on or after the date as of
which such assignment to the Affiliate, and the Affiliate's assumption and
agreement to so perform this Agreement, becomes effective.
6. Corporation's Obligation. The Corporation agrees that it will
------------------------
take such steps as may be necessary to cause the Company (or any Affiliate that
has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
6
<PAGE>
7. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a mere
----------------
unsecured creditor of the Company and the Corporation with respect to his right
to receive any payment under this Agreement. This Agreement shall constitute a
mere promise by the Company and the Corporation to make payments in the future
of the benefits provided for herein. It is the intention of the parties hereto
that the arrangements reflected in this Agreement shall be treated as unfunded
for tax purposes and, if it should be determined that Title I of ERISA is
applicable to this Agreement, for purposes of Title I of ERISA. Except as
provided in Section 2(g), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan or program provided by the Company, the Corporation or any other
Affiliate of the Corporation and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company, the Corporation or any other Affiliate of the
Corporation. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company, the
Corporation or any other Affiliate of the Corporation shall be payable in
accordance with such plan or program, except as explicitly modified by this
Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, defense, recoupment, or other right which
the Company may have against the Executive or others.
10. Miscellaneous. No provision of this Agreement may be modified,
-------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by
7
<PAGE>
the Executive, the Corporation and the Company. No waiver by any party hereto at
any time of any breach by any other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreement or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by any party which are not expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
12. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of New Jersey without
giving effect to the conflict of laws principles thereof. Any action brought by
any party to this Agreement shall be brought and maintained in a court of
competent jurisdiction in Morris County in the State of New Jersey.
13. Severability. The provisions of this Agreement shall be deemed
------------
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto, and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto.
15. Definitions.
-----------
15.1. Accrued Compensation. For purposes of this Agreement,
--------------------
"Accrued Compensation" shall mean all amounts of compensation for services
rendered to the Company or any other Affiliate that have been earned or accrued
through the Termination Date but that have not been paid as of the
8
<PAGE>
Termination Date including (a) base salary, (b) reimbursement for reasonable and
necessary business expenses incurred by the Executive on behalf of the Company
during the period ending on the Termination Date, (c) vacation pay and (d)
bonuses and incentive compensation; provided, however, that Accrued Compensation
shall not include any amounts described in clause (a) or clause (d) that have
been deferred pursuant to any salary reduction or deferred compensation
elections made by the Executive.
15.2. Affiliate. For purposes of this Agreement, "Affiliate"
---------
means any entity, directly or indirectly, controlled by, controlling or under
common control with the Corporation or any corporation or other entity
acquiring, directly or indirectly, all or substantially all the assets and
business of the Corporation, whether by operation of law or otherwise.
15.3. Base Amount. For purposes of this Agreement, "Base
-----------
Amount" shall mean the Executive's annual base salary at the rate in effect as
of the date of a Change in Control or, if greater, at any time thereafter,
determined without regard to any salary reduction or deferred compensation
elections made by the Executive.
15.4. Bonus Amount. For purposes of this Agreement, "Bonus
------------
Amount" shall mean the greater of (a) the target annual bonus payable to the
Executive under the Incentive Plan in respect of the fiscal year during which
the Termination Date occurs or (b) the highest annual bonus paid or payable
under the Incentive Plan in respect of any of the three full fiscal years ended
prior to the Termination Date or, if greater, the three (3) full fiscal years
ended prior to the Change in Control.
15.5. Cause. For purposes of this Agreement, a termination of
-----
employment is for "Cause" if the Executive has been convicted of a felony or the
termination is evidenced by a resolution adopted in good faith by two-thirds of
the Board of Directors of the Corporation that the Executive:
(a) intentionally and continually failed substantially to
perform his reasonably assigned duties with the Company or the Corporation
(other than a failure resulting from the Executive's incapacity due to physical
or mental illness or from the assignment to the Executive of duties that would
constitute Good Reason) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company or the Corporation, has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or
9
<PAGE>
(b) intentionally engaged in conduct which is demonstrably
and materially injurious to the Corporation or the Company; provided, however,
that no termination of the Executive's employment shall be for Cause as set
forth in this Section 15.5(b) until (1) there shall have been delivered to the
Executive a copy of a written notice, signed by a duly authorized officer of the
Company or the Corporation, setting forth that the Executive was guilty of the
conduct set forth in this Section 15.5(b) and specifying the particulars thereof
in detail, and (2) the Executive shall have been provided an opportunity to be
heard in person by the Board of Directors of the Corporation (with the
assistance of the Executive's counsel if the Executive so desires).
No act, nor failure to act, on the Executive's part, shall be considered
"intentional" unless the Executive has acted, or failed to act, with a lack of
good faith and with a lack of reasonable belief that the Executive's action or
failure to act was in the best interest of the Corporation and the Company.
Notwithstanding anything contained in this Agreement to the contrary, no failure
to perform by the Executive after a Notice of Termination is given to the
Company by the Executive shall constitute Cause for purposes of this Agreement.
15.6. Change in Control. A "Change in Control" shall mean the
-----------------
occurrence during the term of the Agreement of:
(a) An acquisition (other than directly from the
Corporation) of any common stock of the Corporation ("Common Stock") or other
voting securities of the Corporation entitled to vote generally for the election
of directors (the "Voting Securities") by any "Person" (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), immediately after which such Person has
"Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty percent (20%) or more of the then outstanding shares of
Common Stock or the combined voting power of the Corporation's then outstanding
Voting Securities; provided, however, in determining whether a Change in Control
has occurred, Voting Securities which are acquired in a Non-Control Acquisition
(as hereinafter defined) shall not constitute an acquisition which would cause a
Change in Control. A "Non-Control Acquisition" shall mean an acquisition by (i)
an employee benefit plan (or a trust forming a part thereof) maintained by (A)
the Corporation or (B) any corporation or other Person of which a majority of
its voting power or its voting equity securities or equity interest is owned,
directly or indirectly, by the Corporation (a "Subsidiary") (ii) the Corporation
or its Subsidiaries, or (iii) any Person in connection with a Non-Control
Transaction (as hereinafter defined);
10
<PAGE>
(b) The individuals who, as of August 1, 1996, are members of the Board of
Directors of the Corporation (the "Incumbent Board"), cease for any reason
to constitute at least seventy percent (70%) of the members of the Board of
Directors of the Corporation; provided, however, that if the election, or
nomination for election by the Corporation's shareholders, of any new
director was approved by a vote of at least two-thirds of the Incumbent
Board, such new director shall, for purposes of this Agreement, be
considered as a member of the Incumbent Board; provided further, however,
that no individual shall be considered a member of the Incumbent Board if
such individual initially assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11 promulgated
under the Exchange Act) or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board of
Directors of the Corporation (a "Proxy Contest") including by reason of any
agreement intended to avoid or settle any Election Contest or Proxy
Contest; or
(c) The consummation of:
(1) A merger, consolidation or reorganization with or
into the Corporation or in which securities of the Corporation are issued,
unless such merger, consolidation or reorganization is a "Non-Control
Transaction." A "Non-Control Transaction" shall mean a merger, consolidation or
reorganization with or into the Corporation or in which securities of the
Corporation are issued where:
(A) the shareholders of the Corporation, immediately
before such merger, consolidation or reorganization, own directly or indirectly
immediately following such merger, consolidation or reorganization, at least
sixty percent (60%) of the combined voting power of the outstanding voting
securities of the corporation resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities immediately before such
merger, consolidation or reorganization,
(B) the individuals who were members of the Incumbent
Board immediately prior to the execution of the agreement providing for such
merger, consolidation or reorganization constitute at least seventy percent
(70%) of the members of the board of directors of the Surviving Corporation, or
a corporation beneficially directly or indirectly owning a majority of the
Voting Securities of the Surviving Corporation, and
11
<PAGE>
(C) no Person other than (i) the Corporation, (ii)
any Subsidiary, (iii) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation, the Surviving Corporation, or
any Subsidiary, or (iv) any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of twenty percent (20%)
or more of the then outstanding Voting Securities or common stock of the
Corporation, has Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Surviving Corporation's then outstanding voting
securities or its common stock.
(2) A complete liquidation or dissolution of the
Corporation; or
(3) The sale or other disposition of all or substantially
all of the assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the then outstanding
common stock or Voting Securities as a result of the acquisition of Common Stock
or Voting Securities by the Corporation which, by reducing the number of shares
of Common Stock or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Person, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of shares of Common Stock or Voting Securities by
the Corporation, and after such share acquisition by the Corporation, the
Subject Person becomes the Beneficial Owner of any additional shares of Common
Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
15.7. Company and Corporation. For purposes of this
-----------------------
Agreement, all references to the Company and the Corporation shall include their
respective Successors and Assigns.
15.8. Disability. For purposes of this Agreement,
----------
"Disability" shall mean a physical or mental infirmity which impairs the
Executive's ability to substantially perform his duties with the Company for six
(6) consecutive months, and within the time period set forth in a Notice of
Termination given to the Executive (which time period shall not be less than
thirty (30) days), the Executive shall not have returned to full-time
performance of his duties; provided, however, that if the Company's
12
<PAGE>
Voluntary Employees Beneficiary Association Long Term Disability Income Plan, or
any successor plan (the "Disability Plan"), is then in effect, the Executive
shall not be deemed disabled for purposes of this Agreement unless the Executive
is also eligible for "Total Disability" (as defined in the Disability Plan)
benefits (or similar benefits in the event of a successor plan) under the
Disability Plan.
15.9. Good Reason. (a) For purposes of this Agreement,
-----------
"Good Reason" shall mean the occurrence after a Change in Control of any of the
following events or conditions:
(1) a change in the Executive's status, title,
position or responsibilities (including reporting responsibilities) which, in
the Executive's reasonable judgment, represents an adverse change from his
status, title, position or responsibilities as in effect immediately prior
thereto; the assignment to the Executive of any duties or responsibilities
which, in the Executive's reasonable judgment, are inconsistent with his status,
title, position or responsibilities; or any removal of the Executive from or
failure to reappoint or reelect him to any of such offices or positions, except
in connection with the termination of his employment for Disability, Cause, as a
result of his death or by the Executive other than for Good Reason;
(2) a reduction in the Executive's annual base salary
below the Base Amount;
(3) the relocation of the offices of the Company at
which the Executive is principally employed to a location more than twenty-five
(25) miles from the location of such offices immediately prior to such Change in
Control, or the Company's or the Corporation's requiring the Executive to be
based anywhere other than such offices, except to the extent the Executive was
not previously assigned to a principal location and except for required travel
on the Company's or the Corporation's business to an extent substantially
consistent with the Executive's business travel obligations at the time of the
Change in Control;
(4) the failure by the Company or the Corporation to
pay to the Executive any portion of the Executive's current compensation or to
pay to the Executive any portion of an installment of deferred compensation
under any deferred compensation program of the Company or the Corporation in
which the Executive participated, within seven (7) days of the date such
compensation is due;
(5) the failure by the Company or the Corporation to
(A) continue in effect (without reduction in benefit level, and/or reward
opportunities) any material compensation or employee benefit plan in which the
Executive was
13
<PAGE>
participating immediately prior to the Change in Control, including, but not
limited to, any of the plans listed in Appendix A hereto, unless a substitute or
replacement plan has been implemented which provides substantially identical
compensation or benefits to the Executive or (B) provide the Executive with
compensation and benefits, in the aggregate, at least equal (in terms of benefit
levels and/or reward opportunities) to those provided for under each other
compensation or employee benefit plan, program and practice in which the
Executive was participating immediately prior to the Change in Control;
(6) the failure of the Company or the Corporation to
obtain from its Successors or Assigns the express assumption and agreements
required under Section 11 hereof; or
(7) any purported termination of the Executive's
employment by the Company which is not effected pursuant to a Notice of
Termination satisfying the terms set forth in the definition of Notice of
Termination (and, if applicable, the terms set forth in the definition of
Cause).
(b) Any event or condition (1) described in Section
15.9(a)(1), (2), (3), (4), (6) or (7) which occurs within twelve (12) months
prior to a Change in Control or (2) described in Section 15.9(a)(1) through (7)
which occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a Third Party who effectuates a Change in
Control or (B) otherwise arose in connection with, or in anticipation of a
Change in Control which has been threatened or proposed and which actually
occurs, shall constitute Good Reason for purposes of this Agreement
notwithstanding that it occurred prior to a Change in Control.
15.10. Incentive Plan. For purposes of this Agreement,
--------------
"Incentive Plan" shall mean the Incentive Compensation Plan for Elected
Officers, or any successor annual incentive plan, maintained by the Company or
any other Affiliate.
15.11. Notice of Termination. For purposes of this
---------------------
Agreement, following a Change in Control, "Notice of Termination" shall mean a
written notice of termination of the Executive's employment, signed by the
Executive if to the Company or by a duly authorized officer of the Company if to
the Executive, which indicates the specific termination provision in this
Agreement, if any, relied upon and which sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated.
14
<PAGE>
15.12. Pro Rata Bonus. For purposes of this Agreement,
--------------
"Pro Rata Bonus" shall mean an amount equal to the Bonus Amount multiplied by a
fraction the numerator of which is the number of days in such fiscal year
through the Termination Date and the denominator of which is 365; provided,
however, that the Pro Rata Bonus shall be reduced, but not below zero, to the
extent of any bonus the Executive is entitled to receive pursuant to the
Incentive Plan in respect of the fiscal year (denoted a "Performance Period"
under the Incentive Plan) in which the Termination Date occurs.
15.13. Successors and Assigns. For purposes of this
----------------------
Agreement, "Successors and Assigns" shall mean, with respect to the Company or
the Corporation, a corporation or other entity acquiring all or substantially
all the assets and business of the Company or the Corporation, as the case may
be (including this Agreement) whether by operation of law or otherwise.
15.14. Termination Date
----------------
. (a) For purposes of this Agreement, "Termination
Date" shall mean (i) in the case of the Executive's death, his date of death,
(ii) if the Executive's employment is terminated for Disability, thirty (30)
days after Notice of Termination is given (provided that the Executive shall not
have returned to the performance of his duties on a full-time basis during such
thirty (30) day period) and (iii) if the Executive's employment is terminated
for any other reason, the date specified in the Notice of Termination (which, in
the case of a termination for Cause shall not be less than thirty (30) days, and
in the case of a termination for Good Reason shall not be more than sixty (60)
days, from the date such Notice of Termination is given); provided, however,
that if within thirty (30) days after a Notice of Termination by the Company for
Cause or a Notice of Termination by the Executive for Good Reason is given the
party receiving such Notice of Termination in good faith notifies the other
party that a dispute exists concerning the basis for the termination, the
provisions of paragraph (b) shall apply.
(b)(i) If the Executive gives the Company Notice of
Termination for Good Reason and the Company disputes the basis for the
termination, the Termination Date shall be the date on which the dispute is
finally determined, either by mutual written agreement of the parties, or by the
final judgment, order or decree of a court of competent jurisdiction (the time
for appeal therefrom having expired and no appeal having been taken) and the
Company shall continue to pay the Executive his Base Amount and continue the
Executive as a participant in all compensation, incentive, bonus, pension,
profit sharing, medical, hospitalization, dental, life insurance and disability
benefit plans in which he was participating when the notice giving rise to the
dispute was
15
<PAGE>
given, until such Termination Date, provided that if the Executive continues to
perform his duties with the Company during the pendency of such dispute, the
Executive shall not be obligated to repay to the Company any amounts paid or
benefits provided pursuant to this Section 15.14(b), and further provided that
if the Executive ceased performing his duties with the Company during the
pendency of such dispute, and the dispute is resolved in favor of the Executive,
any amount owed to the Executive pursuant to Section 2 of this Agreement shall
be reduced to the extent of any amount the Executive received pursuant to this
Section 15.14(b) during the pendency of such dispute; and (ii) if the Company
gives the Executive Notice of Termination for Cause and the Executive disputes
the basis for the termination, the Termination Date shall be as determined
pursuant to Section 15.14(a) and during the pendency of such dispute the
Executive shall not be entitled to payment of his Base Amount from the Company
and, except as required by law, the Executive's participation in the Company's
benefit plans and programs shall be discontinued.
IN WITNESS WHEREOF, the Corporation and the Company have caused this
Agreement to be executed by their duly authorized officers and the Executive has
executed this Agreement as of the day and year first above written.
GPU, Inc.
By:_________________________
ATTEST: Fred D. Hafer
Chairman, President and Chief
Executive Officer
__________________________
Secretary
GPU Service, Inc.
By:_________________________
ATTEST: Fred D. Hafer
Chairman, President and Chief
Executive Officer
- --------------------------
Secretary
By:_________________________
Carole B. Snyder
16
<PAGE>
APPENDIX A
1. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
2. The Company's Incentive Plan
3. The GPU Companies Deferred Compensation Plan
4. The GPU Companies Employee Pension Plan
5. The Company's Supplemental and Excess Benefits Plan
6. The Company's Employee Life Insurance Plan
7. Senior Executive Split-Dollar Life Insurance Program
8. The GPU Companies Accident Insurance Plan
9. The GPU Companies Health Care Plan for Non-Bargaining Employees and
the Company's Health Care Plan for Non-bargaining Retirees, if
applicable
10. The GPU Companies Supplemental Medical Expense Plan for Elected
Officers
11. The GPU Companies Flexible Benefits Plan for Non-bargaining Employees
12. The GPU Companies Group Specified Disease Insurance Plan
13. The GPU Companies Long Term Disability Income Plan
14. The GPU Companies Employee Savings Plan
15. The Company's Vacation Policy for Non-Bargaining Unit Employees
17
<PAGE>
EXHIBIT C-28
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 16th day of December, 1998, by and
-------- ---------------
among GPU, Inc. (the "Corporation"), GPU Service, Inc. (the "Company") and
Bruce L. Levy (the "Executive") amends and restates the former Severance
- -------------
Protection Agreement dated June 5, 1997, by and among the Corporation, GPU
------------
International, Inc. and the Executive (the "Former Agreement").
WHEREAS, the Board of Directors of the Corporation and the Board of
Directors of the Company (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation;
WHEREAS, the Boards have determined that it is essential and in the
best interest of the Company, and the Corporation and its stockholders, for the
Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Company, particularly in the event of a threat or the occurrence of a Change
in Control, the Company desires to enter into this Agreement with the Executive
to provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of December
-----------------
16, 1998, and shall continue in effect until October 31, 2000 (the "Term");
provided, however, that on November 1, 1999, and on each November 1 thereafter,
the Term shall automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to the other at least
ninety (90) days prior thereto that the Term shall not be so extended; provided,
further, however, that following the occurrence of a Change in Control, the Term
shall not expire prior to the expiration of twenty-four (24) months after such
occurrence.
<PAGE>
2. Termination of Employment. If the Executive's employment with the
-------------------------
Company and with all other Affiliates of the Corporation shall be terminated
within twenty-four (24) months following a Change in Control, the Executive
shall be entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated for any reason, the
Company shall pay to the Executive his Accrued Compensation. In addition to the
foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated (i) by the Company
without Cause (other than by reason of the Executive's Disability), or (ii) by
the Executive for Good Reason, the Executive shall be entitled to the following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance pay
and in lieu of any further compensation for periods subsequent to the
Termination Date, an amount determined by multiplying (A) three (3) times the
sum of (i) the Executive's Base Amount and (ii) the Executive's Bonus Amount, by
(B) a fraction, the numerator of which is the number of months, not to exceed
thirty-six (36), in the period beginning on the Termination Date and ending on
the Executive's Normal Retirement Date (as defined in the Company's Employee
Pension Plan), and the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36), or if
earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the Executive immediately
prior to the Change in Control or, if greater, the coverages and benefits
provided at any time thereafter. The coverages and benefits (including
deductibles and costs) provided in this Section 2(b)(3) during the Continuation
Period shall be no less favorable to the Executive and his dependents and
beneficiaries, than the most favorable of such coverages and benefits referred
to above. The Company's obligation hereunder with respect to the foregoing
coverages and benefits shall be reduced to the extent that the Executive obtains
any such coverages and benefits pursuant to a subsequent employer's benefit
plans, in which case the Company may
2
<PAGE>
reduce any of the coverages or benefits it is required to provide the Executive
hereunder so long as the aggregate coverages and benefits of the combined
benefit plans is no less favorable to the Executive than the coverages and
benefits required to be provided hereunder. This Section 2(b)(3) shall not be
interpreted so as to limit any benefits to which the Executive, his dependents
or beneficiaries may be entitled under any of the Company's employee benefit
plans, programs or practices following the Executive's termination of
employment, including without limitation, retiree medical and life insurance
benefits;
(4) the Company shall pay or reimburse the Executive for
the costs, fees and expenses of outplacement assistance services (not to exceed
twenty percent (20%) of the sum of (A) the Executive's Base Amount and (B) the
Executive's Bonus Amount) provided by any outplacement agency selected by the
Executive; and
(5) the Company shall provide to the Executive the use of a
Company-leased vehicle, at no cost to the Executive, until the earlier of (A)
the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the Company
without Cause (other than by reason of the Executive's Disability) (1) within
twelve (12) months prior to a Change in Control or (2) any time prior to the
date of a Change in Control but the Executive reasonably demonstrates that such
termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control which has been
threatened or proposed such termination shall be deemed to have occurred after a
Change in Control, provided a Change in Control shall actually have occurred.
(d) (1) Gross-Up Payment. In the event it shall be determined
----------------
that any payment or distribution of any type to or for the benefit of the
Executive, by the Company, the Corporation, any Affiliate, any Person (as
defined in Section 15.6(a) hereof) who acquires ownership or effective control
of the Corporation or ownership of a substantial portion of the Corporation's
assets (within the meaning of Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder) or any affiliate of
such Person, whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise (the "Total Payments"), is
3
<PAGE>
or will be subject to the excise tax imposed by Section 4999 of the Code or any
interest or penalties with respect to such excise tax (such excise tax, together
with any such interest and penalties, are collectively referred to as the
"Excise Tax"), then the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with respect
to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive, absent manifest error. As a
result of uncertainty in the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm hereunder, it is possible
that Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment or Overpayment
that has occurred. In the case of an Underpayment,
4
<PAGE>
the amount of such Underpayment shall be promptly paid by the Company to or for
the benefit of the Executive. In the case of an Overpayment, the Executive
shall, at the direction and expense of the Company, take such steps as are
reasonably necessary (including the filing of returns and claims for refund),
follow reasonable instructions from, and procedures established by, the Company,
and otherwise reasonably cooperate with the Company to correct such Overpayment,
provided, however, that (i) the Executive shall not in any event be obligated to
return to the Company an amount greater than the net after-tax portion of the
Overpayment that he has retained or has recovered as a refund from the
applicable taxing authorities and (ii) this provision shall be interpreted in a
manner consistent with the intent of Section 2(d)(1), which is to make the
Executive whole, on an after-tax basis, from the application of the Excise Tax,
it being understood that the correction of an Overpayment may result in the
Executive repaying to the Company an amount which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1), (2)
and (4) shall be paid in a single lump sum cash payment within thirty (30) days
after the Executive's Termination Date (or earlier, if required by applicable
law).
(f) The Executive shall not be required to mitigate the amount
of any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
(g) The severance pay and benefits provided for in this Section
2 shall be in lieu of any other severance pay to which the Executive may be
entitled under the GPU System Severance Procedure or any other plan, agreement
or arrangement of the Company or any other Affiliate of the Corporation.
(h) The Executive's entitlement to other compensation or
benefits, pursuant to the Company's employee benefit plans and other applicable
programs and practices shall be determined in accordance with the terms of those
plans, programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i) any
---------------------
intended termination of the Executive's employment by the Company shall be
communicated by a Notice of Termination from the Company to the Executive, and
(ii) any intended termination of the Executive's employment by the Executive for
Good Reason shall be communicated by a Notice of Termination from the Executive
to the Company within six (6)
5
<PAGE>
months of the Executive becoming aware of the event or action constituting Good
Reason or, if later, within six (6) months after the date of the Change in
Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under this Agreement if (a) the Executive's
employment with the Company terminates as a result of the transfer of his
employment to any other Affiliate of the Corporation, (b) this Agreement is
assigned to such other Affiliate, and (c) such other Affiliate expressly assumes
and agrees to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no assignment had taken
place. Any Affiliate to which this Agreement is so assigned shall be treated as
the "Company" for all purposes of this Agreement on or after the date as of
which such assignment to the Affiliate, and the Affiliate's assumption and
agreement to so perform this Agreement, becomes effective.
6. Corporation's Obligation. The Corporation agrees that it will
------------------------
take such steps as may be necessary to cause the Company (or any Affiliate that
has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
6
<PAGE>
7. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a mere
----------------
unsecured creditor of the Company and the Corporation with respect to his right
to receive any payment under this Agreement. This Agreement shall constitute a
mere promise by the Company and the Corporation to make payments in the future
of the benefits provided for herein. It is the intention of the parties hereto
that the arrangements reflected in this Agreement shall be treated as unfunded
for tax purposes and, if it should be determined that Title I of ERISA is
applicable to this Agreement, for purposes of Title I of ERISA. Except as
provided in Section 2(g), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan or program provided by the Company, the Corporation or any other
Affiliate of the Corporation and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company, the Corporation or any other Affiliate of the
Corporation. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company, the
Corporation or any other Affiliate of the Corporation shall be payable in
accordance with such plan or program, except as explicitly modified by this
Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, defense, recoupment, or other right which
the Company may have against the Executive or others.
10. Miscellaneous. No provision of this Agreement may be modified,
-------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by
7
<PAGE>
the Executive, the Corporation and the Company. No waiver by any party hereto
at any time of any breach by any other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreement or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by any party which are not expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
12. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of New Jersey without
giving effect to the conflict of laws principles thereof. Any action brought by
any party to this Agreement shall be brought and maintained in a court of
competent jurisdiction in Morris County in the State of New Jersey.
13. Severability. The provisions of this Agreement shall be deemed
------------
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto, and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto,
with respect to the subject matter hereof, including the Former Agreement and
the Executive agrees that the Former Agreement is terminated and shall have no
further force or effect.
8
<PAGE>
EXHIBIT C-29
SEVERANCE PROTECTION AGREEMENT
------------------------------
THIS AGREEMENT made as of the 1st day of January, 1999, by and
------- --------------
among GPU, Inc. (the "Corporation"), GPU Service, Inc. (the "Company") and
Dennis P. Baldassari (the "Executive") amends and restates the former
- --------------------
Severance Protection Agreement dated June 5, 1997, by and among the Corporation,
------------
Jersey Central Power and Light Company and the Executive (the "Former
Agreement").
WHEREAS, the Board of Directors of the Corporation and the Board of
Directors of the Company (the "Boards") recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the threat or the
occurrence of a Change in Control can result in significant distraction of the
Company's key management personnel because of the uncertainties inherent in such
a situation;
WHEREAS, the Boards have determined that it is essential and in the
best interest of the Company, and the Corporation and its stockholders, for the
Company to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control and to ensure the Executive's continued
dedication and efforts in such event without undue concern for the Executive's
personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of
the Company, particularly in the event of a threat or the occurrence of a Change
in Control, the Company desires to enter into this Agreement with the Executive
to provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of January 1,
-----------------
1999, and shall continue in effect until October 31, 2000 (the "Term");
provided, however, that on November 1, 1999, and on each November 1 thereafter,
the Term shall automatically be extended for one (1) year unless either the
Executive or the Company shall have given written notice to the other at least
ninety (90) days prior thereto that the Term shall not be so extended; provided,
further, however, that following the occurrence of a Change in Control, the Term
shall not expire prior to the expiration of twenty-four (24) months after such
occurrence.
<PAGE>
2. Termination of Employment. If the Executive's employment with the
-------------------------
Company and with all other Affiliates of the Corporation shall be terminated
within twenty-four (24) months following a Change in Control, the Executive
shall be entitled to the following compensation and benefits:
(a) If the Executive's employment with the Company and with
all other Affiliates of the Corporation shall be terminated for any reason the
Company shall pay to the Executive his Accrued Compensation. In addition to the
foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's death, the Company shall pay to the
Executive or his beneficiaries a Pro Rata Bonus.
(b) If the Executive's employment with the Company and with all
other Affiliates of the Corporation shall be terminated (i) by the Company
without Cause (other than by reason of the Executive's Disability), or (ii) by
the Executive for Good Reason, the Executive shall be entitled to the following:
(1) the Company shall pay the Executive all Accrued
Compensation and a Pro Rata Bonus;
(2) the Company shall pay the Executive as severance pay and
in lieu of any further compensation for periods subsequent to the Termination
Date, an amount determined by multiplying (A) three (3) times the sum of (i) the
Executive's Base Amount and (ii) the Executive's Bonus Amount, by (B) a
fraction, the numerator of which is the number of months, not to exceed thirty-
six (36), in the period beginning on the Termination Date and ending on the
Executive's Normal Retirement Date (as defined in the Company's Employee Pension
Plan), and the denominator of which is thirty-six (36).
(3) for a number of months equal to thirty-six (36), or if
earlier, until the Executive's Normal Retirement Date (as defined in the
Company's Employee Pension Plan) (the "Continuation Period"), the Company shall
at its expense continue on behalf of the Executive and his dependents and
beneficiaries the life insurance, disability, medical, dental and
hospitalization coverages and benefits provided to the Executive immediately
prior to the Change in Control or, if greater, the coverages and benefits
provided at any time thereafter. The coverages and benefits (including
deductibles and costs) provided in this Section 2(b)(3) during the Continuation
Period shall be no less favorable to the Executive and his dependents and
beneficiaries, than the most favorable of such coverages and benefits referred
to above. The Company's obligation hereunder with respect to the foregoing
coverages and benefits shall be reduced to the extent that the Executive obtains
any such coverages and benefits pursuant to a
2
<PAGE>
subsequent employer's benefit plans, in which case the Company may reduce any of
the coverages or benefits it is required to provide the Executive hereunder so
long as the aggregate coverages and benefits of the combined benefit plans is no
less favorable to the Executive than the coverages and benefits required to be
provided hereunder. This Section 2(b)(3) shall not be interpreted so as to limit
any benefits to which the Executive, his dependents or beneficiaries may be
entitled under any of the Company's employee benefit plans, programs or
practices following the Executive's termination of employment, including without
limitation, retiree medical and life insurance benefits;
(4) the Company shall pay or reimburse the Executive for the
costs, fees and expenses of outplacement assistance services (not to exceed
twenty percent (20%) of the sum of (A) the Executive's Base Amount and (B) the
Executive's Bonus Amount) provided by any outplacement agency selected by the
Executive; and
(5) the Company shall provide to the Executive the use of a
Company-leased vehicle, at no cost to the Executive, until the earlier of (A)
the date occurring six (6) months after the Termination Date or (B) the
Executive's sixty-fifth (65th) birthday, after which date the Executive shall
have the option to purchase the vehicle at its "blue book" value.
(c) If the Executive's employment is terminated by the Company
without Cause (other than by reason of the Executive's Disability) (1) within
twelve (12) months prior to a Change in Control or (2) any time prior to the
date of a Change in Control but the Executive reasonably demonstrates that such
termination (A) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control (a
"Third Party") and who effectuates a Change in Control or (B) otherwise arose in
connection with, or in anticipation of, a Change in Control which has been
threatened or proposed such termination shall be deemed to have occurred after a
Change in Control, provided a Change in Control shall actually have occurred.
(d) (1) Gross-Up Payment. In the event it shall be determined
----------------
that any payment or distribution of any type to or for the benefit of the
Executive, by the Company, the Corporation, any Affiliate, any Person (as
defined in Section 15.6(a) hereof) who acquires ownership or effective control
of the Corporation or ownership of a substantial portion of the Corporation's
assets (within the meaning of Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder) or any affiliate of
such Person, whether
3
<PAGE>
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise (the "Total Payments"), is or will be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax, imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments.
(2) Determination By Accountant. All mathematical
---------------------------
determinations, and all determinations as to whether any of the Total Payments
are "parachute payments" (within the meaning of Section 280G of the Code), that
are required to be made under this Section 2(d), including determinations as to
whether a Gross-Up Payment is required, the amount of such Gross-Up Payment and
amounts relevant to the last sentence of this Section 2(d)(2), shall be made by
an independent accounting firm selected by the Executive from among the six (6)
largest accounting firms in the United States (the "Accounting Firm"), which
shall provide its determination (the "Determination"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment and any
other relevant matter, both to the Company and the Executive by no later than
ten (10) days following the Termination Date, if applicable, or such earlier
time as is requested by the Company or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to the Excise
Tax). If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive and the Company with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Executive has substantial
authority not to report any Excise Tax on his federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Executive
within twenty (20) days after the Determination (and all accompanying
calculations and other material supporting the Determination) is delivered to
the Company by the Accounting Firm. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive, absent manifest error. As
a result of uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments not made by the Company should have been made
("Underpayment"), or that Gross-Up Payments will have been made by the Company
which should
4
<PAGE>
not have been made ("Overpayments"). In either such event, the Accounting Firm
shall determine the amount of the Underpayment or Overpayment that has occurred.
In the case of an Underpayment, the amount of such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive. In the
case of an Overpayment, the Executive shall, at the direction and expense of the
Company, take such steps as are reasonably necessary (including the filing of
returns and claims for refund), follow reasonable instructions from, and
procedures established by, the Company, and otherwise reasonably cooperate with
the Company to correct such Overpayment, provided, however, that (i) the
Executive shall not in any event be obligated to return to the Company an amount
greater than the net after-tax portion of the Overpayment that he has retained
or has recovered as a refund from the applicable taxing authorities and (ii)
this provision shall be interpreted in a manner consistent with the intent of
Section 2(d)(1), which is to make the Executive whole, on an after-tax basis,
from the application of the Excise Tax, it being understood that the correction
of an Overpayment may result in the Executive repaying to the Company an amount
which is less than the Overpayment.
(e) The amounts provided for in Sections 2(a) and 2(b)(1), (2)
and (4) shall be paid in a single lump sum cash payment within thirty (30) days
after the Executive's Termination Date (or earlier, if required by applicable
law).
(f) The Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Executive in any subsequent employment
except as provided in Section 2(b)(3).
(g) The severance pay and benefits provided for in this Section 2
shall be in lieu of any other severance pay to which the Executive may be
entitled under the GPU System Severance Procedure or any other plan, agreement
or arrangement of the Company or any other Affiliate of the Corporation.
(h) The Executive's entitlement to other compensation or benefits
pursuant to the Company's employee benefit plans and other applicable programs
and practices shall be determined in accordance with the terms of those plans,
programs and practices as in effect from time to time.
3. Notice of Termination. Following a Change in Control, (i) any
---------------------
intended termination of the Executive's employment by the Company shall be
communicated by a Notice of
5
<PAGE>
Termination from the Company to the Executive, and (ii) any intended termination
of the Executive's employment by the Executive for Good Reason shall be
communicated by a Notice of Termination from the Executive to the Company within
six (6) months of the Executive becoming aware of the event or action
constituting Good Reason or, if later, within six (6) months after the date of
the Change in Control.
4. Fees and Expenses. The Company shall pay all legal fees and
-----------------
related expenses (including the costs of experts, evidence and counsel) incurred
in good faith by the Executive as they become due as a result of (a) the
termination of the Executive's employment by the Company or by the Executive for
Good Reason (including all such fees and expenses, if any, incurred in
contesting, defending or disputing the basis for any such termination of
employment), (b) the Executive's hearing before the Board of Directors of the
Corporation as contemplated in Section 15.5 of this Agreement or (c) the
Executive seeking to obtain or enforce any right or benefit provided by this
Agreement or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits; provided,
however, that the payment of fees and expenses pursuant to this Section 4(c)
shall be made only after, and only to the extent that, the Executive is
unsuccessful in his attempt to obtain or enforce such right or benefit through
the procedures established under the Legal Defense Fund maintained by the
Company under the GPU System Companies Master Executives' Benefits Protection
Trust (or any similar fund under a successor trust).
5. Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any further obligation
or liability to the Executive under this Agreement if (a) the Executive's
employment with the Company terminates as a result of the transfer of his
employment to any other Affiliate of the Corporation, (b) this Agreement is
assigned to such other Affiliate, and (c) such other Affiliate expressly assumes
and agrees to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no assignment had taken
place. Any Affiliate to which this Agreement is so assigned shall be treated as
the "Company" for all purposes of this Agreement on or after the date as of
which such assignment to the Affiliate, and the Affiliate's assumption and
agreement to so perform this Agreement, becomes effective.
6
<PAGE>
6. Corporation's Obligation. The Corporation agrees that it will
------------------------
take such steps as may be necessary to cause the Company (or any Affiliate that
has become the "Company" pursuant to Section 5 hereof) to meet each of its
obligations to the Executive under this Agreement.
7. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including any Notice of
Termination) shall be in writing, shall be signed by the Executive if to the
Company or by a duly authorized officer of the Company if to the Executive, and
shall be deemed to have been duly given when personally delivered or sent by
certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof, except that notice of change of address
shall be effective only upon receipt.
8. Nature of Rights. The Executive shall have the status of a mere
----------------
unsecured creditor of the Company and the Corporation with respect to his right
to receive any payment under this Agreement. This Agreement shall constitute a
mere promise by the Company and the Corporation to make payments in the future
of the benefits provided for herein. It is the intention of the parties hereto
that the arrangements reflected in this Agreement shall be treated as unfunded
for tax purposes and, if it should be determined that Title I of ERISA is
applicable to this Agreement, for purposes of Title I of ERISA. Except as
provided in Section 2(g), nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan or program provided by the Company, the Corporation or any other
Affiliate of the Corporation and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company, the Corporation or any other Affiliate of the
Corporation. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company, the
Corporation or any other Affiliate of the Corporation shall be payable in
accordance with such plan or program, except as explicitly modified by this
Agreement.
9. Settlement of Claims. The Company's obligation to make the
--------------------
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any
7
<PAGE>
circumstances, including, without limitation, any set-off, counterclaim,
defense, recoupment, or other right which the Company may have against the
Executive or others.
10. Miscellaneous. No provision of this Agreement may be modified,
-------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive, the Corporation and the Company. No
waiver by any party hereto at any time of any breach by any other party hereto
of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreement or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by any party which are not
expressly set forth in this Agreement.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Company, the Corporation and their respective Successors and
Assigns. The Company and the Corporation shall require their respective
Successors and Assigns to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company and/or the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Executive, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal personal representative.
12. Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of New Jersey without
giving effect to the conflict of laws principles thereof. Any action brought by
any party to this Agreement shall be brought and maintained in a court of
competent jurisdiction in Morris County in the State of New Jersey.
13. Severability. The provisions of this Agreement shall be deemed
------------
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
14. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto, and supersedes all prior agreements, if any,
understandings and arrangements, oral
8
<PAGE>
or written, between the parties hereto, with respect to the subject matter
hereof, including the Former Agreement and the Executive agrees that the Former
Agreement is terminated and shall have no further force or effect.
15. Definitions.
-----------
15.1. Accrued Compensation. For purposes of this Agreement,
--------------------
"Accrued Compensation" shall mean all amounts of compensation for services
rendered to the Company or any other Affiliate that have been earned or accrued
through the Termination Date but that have not been paid as of the Termination
Date including (a) base salary, (b) reimbursement for reasonable and necessary
business expenses incurred by the Executive on behalf of the Company during the
period ending on the Termination Date, (c) vacation pay and (d) bonuses and
incentive compensation; provided, however, that Accrued Compensation shall not
include any amounts described in clause (a) or clause (d) that have been
deferred pursuant to any salary reduction or deferred compensation elections
made by the Executive.
15.2. Affiliate. For purposes of this Agreement, "Affiliate"
---------
means any entity, directly or indirectly, controlled by, controlling or under
common control with the Corporation or any corporation or other entity
acquiring, directly or indirectly, all or substantially all the assets and
business of the Corporation, whether by operation of law or otherwise.
15.3. Base Amount. For purposes of this Agreement, "Base
-----------
Amount" shall mean the Executive's annual base salary at the rate in effect as
of the date of a Change in Control or, if greater, at any time thereafter,
determined without regard to any salary reduction or deferred compensation
elections made by the Executive.
15.4. Bonus Amount. For purposes of this Agreement, "Bonus
------------
Amount" shall mean the greater of (a) the target annual bonus payable to the
Executive under the Incentive Plan in respect of the fiscal year during which
the Termination Date occurs or (b) the highest annual bonus paid or payable
under the Incentive Plan in respect of any of the three full fiscal years ended
prior to the Termination Date or, if greater, the three (3) full fiscal years
ended prior to the Change in Control.
15.5. Cause. For purposes of this Agreement, a termination of
-----
employment is for "Cause" if the Executive has been convicted of a felony or the
termination is evidenced by a resolution adopted in good faith by two-thirds of
the Board of Directors of the Corporation that the Executive:
9
<PAGE>
(a) intentionally and continually failed substantially to
perform his reasonably assigned duties with the Company or the Corporation
(other than a failure resulting from the Executive's incapacity due to physical
or mental illness or from the assignment to the Executive of duties that would
constitute Good Reason) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company or the Corporation, has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or
(b) intentionally engaged in conduct which is demonstrably
and materially injurious to the Corporation or the Company; provided, however,
that no termination of the Executive's employment shall be for Cause as set
forth in this Section 15.5(b) until (1) there shall have been delivered to the
Executive a copy of a written notice, signed by a duly authorized officer of the
Company or the Corporation, setting forth that the Executive was guilty of the
conduct set forth in this Section 15.5(b) and specifying the particulars thereof
in detail, and (2) the Executive shall have been provided an opportunity to be
heard in person by the Board of Directors of the Corporation (with the
assistance of the Executive's counsel if the Executive so desires).
No act, nor failure to act, on the Executive's part, shall
be considered "intentional" unless the Executive has acted, or failed to act,
with a lack of good faith and with a lack of reasonable belief that the
Executive's action or failure to act was in the best interest of the Corporation
and the Company. Notwithstanding anything contained in this Agreement to the
contrary, no failure to perform by the Executive after a Notice of Termination
is given to the Company by the Executive shall constitute Cause for purposes of
this Agreement.
15.6. Change in Control. A "Change in Control" shall mean the
-----------------
occurrence during the term of the Agreement of:
(a) An acquisition (other than directly from the
Corporation) of any common stock of the Corporation ("Common Stock") or other
voting securities of the Corporation entitled to vote generally for the election
of directors (the "Voting Securities") by any "Person" (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), immediately after which such Person has
"Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty
10
<PAGE>
percent (20%) or more of the then outstanding shares of Common Stock or the
combined voting power of the Corporation's then outstanding Voting Securities;
provided, however, in determining whether a Change in Control has occurred,
Voting Securities which are acquired in a Non-Control Acquisition (as
hereinafter defined) shall not constitute an acquisition which would cause a
Change in Control. A "Non-Control Acquisition" shall mean an acquisition by (i)
an employee benefit plan (or a trust forming a part thereof) maintained by (A)
the Corporation or (B) any corporation or other Person of which a majority of
its voting power or its voting equity securities or equity interest is owned,
directly or indirectly, by the Corporation (a "Subsidiary") (ii) the Corporation
or its Subsidiaries, or (iii) any Person in connection with a Non-Control
Transaction (as hereinafter defined);
(b) The individuals who, as of August 1, 1996, are members
of the Board of Directors of the Corporation (the "Incumbent Board"), cease for
any reason to constitute at least seventy percent (70%) of the members of the
Board of Directors of the Corporation; provided, however, that if the election,
or nomination for election by the Corporation's shareholders, of any new
director was approved by a vote of at least two-thirds of the Incumbent Board,
such new director shall, for purposes of this Agreement, be considered as a
member of the Incumbent Board; provided further, however, that no individual
shall be considered a member of the Incumbent Board if such individual initially
assumed office as a result of either an actual or threatened "Election Contest"
(as described in Rule 14a-11 promulgated under the Exchange Act) or other actual
or threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board of Directors of the Corporation (a "Proxy Contest")
including by reason of any agreement intended to avoid or settle any Election
Contest or Proxy Contest; or
(c) The consummation of:
(1) A merger, consolidation or reorganization with or
into the Corporation or in which securities of the Corporation are issued,
unless such merger, consolidation or reorganization is a "Non-Control
Transaction." A "Non-Control Transaction" shall mean a merger, consolidation or
reorganization with or into the Corporation or in which securities of the
Corporation are issued where:
(A) the shareholders of the Corporation,
immediately before such merger, consolidation or reorganization, own directly or
indirectly immediately following
11
<PAGE>
such merger, consolidation or reorganization, at least sixty percent (60%) of
the combined voting power of the outstanding voting securities of the
corporation resulting from such merger or consolidation or reorganization (the
"Surviving Corporation") in substantially the same proportion as their ownership
of the Voting Securities immediately before such merger, consolidation or
reorganization,
(B) the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing for such merger,
consolidation or reorganization constitute at least seventy percent (70%) of the
members of the board of directors of the Surviving Corporation, or a corporation
beneficially directly or indirectly owning a majority of the Voting Securities
of the Surviving Corporation, and
(C) no Person other than (i) the Corporation, (ii) any
Subsidiary, (iii) any employee benefit plan (or any trust forming a part
thereof) that, immediately prior to such merger, consolidation or
reorganization, was maintained by the Corporation, the Surviving Corporation, or
any Subsidiary, or (iv) any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of twenty percent (20%)
or more of the then outstanding Voting Securities or common stock of the
Corporation, has Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Surviving Corporation's then outstanding voting
securities or its common stock.
(2) A complete liquidation or dissolution of the Corporation; or
(3) The sale or other disposition of all or substantially all of
the assets of the Corporation to any Person (other than a transfer to a
Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any Person (the "Subject Person") acquired Beneficial
Ownership of more than the permitted amount of the then outstanding common stock
or Voting Securities as a result of the acquisition of Common Stock or Voting
Securities by the Corporation which, by reducing the number of shares of Common
Stock or Voting Securities then outstanding, increases the proportional number
of shares Beneficially Owned by the Subject Person, provided that if a Change in
Control would occur (but for the operation of this sentence) as a result of the
acquisition of shares of Common Stock or Voting Securities by the Corporation,
and after such share acquisition by the Corporation,
12
<PAGE>
the Subject Person becomes the Beneficial Owner of any additional shares of
Common Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
15.7. Company and Corporation. For purposes of this Agreement,
-----------------------
all references to the Company and the Corporation shall include their respective
Successors and Assigns.
15.8. Disability. For purposes of this Agreement, "Disability"
----------
shall mean a physical or mental infirmity which impairs the Executive's ability
to substantially perform his duties with the Company for six (6) consecutive
months, and within the time period set forth in a Notice of Termination given to
the Executive (which time period shall not be less than thirty (30) days), the
Executive shall not have returned to full-time performance of his duties;
provided, however, that if the Company's Voluntary Employees Beneficiary
Association Long Term Disability Income Plan, or any successor plan (the
"Disability Plan"), is then in effect, the Executive shall not be deemed
disabled for purposes of this Agreement unless the Executive is also eligible
for "Total Disability" (as defined in the Disability Plan) benefits (or similar
benefits in the event of a successor plan) under the Disability Plan.
15.9. Good Reason. (a) For purposes of this Agreement, "Good
-----------
Reason" shall mean the occurrence after a Change in Control of any of the
following events or conditions:
(1) a change in the Executive's status, title, position or
responsibilities (including reporting responsibilities) which, in the
Executive's reasonable judgment, represents an adverse change from his status,
title, position or responsibilities as in effect immediately prior thereto; the
assignment to the Executive of any duties or responsibilities which, in the
Executive's reasonable judgment, are inconsistent with his status, title,
position or responsibilities; or any removal of the Executive from or failure to
reappoint or reelect him to any of such offices or positions, except in
connection with the termination of his employment for Disability, Cause, as a
result of his death or by the Executive other than for Good Reason;
(2) a reduction in the Executive's annual base salary below
the Base Amount;
(3) the relocation of the offices of the Company at which
the Executive is principally employed to a location more than twenty-five (25)
miles from the location of such offices immediately prior to such Change in
Control, or the
13
<PAGE>
Company's or the Corporation's requiring the Executive to be based anywhere
other than such offices, except to the extent the Executive was not previously
assigned to a principal location and except for required travel on the Company's
or the Corporation's business to an extent substantially consistent with the
Executive's business travel obligations at the time of the Change in Control;
(4) the failure by the Company or the Corporation to pay to
the Executive any portion of the Executive's current compensation or to pay to
the Executive any portion of an installment of deferred compensation under any
deferred compensation program of the Company or the Corporation in which the
Executive participated, within seven (7) days of the date such compensation is
due;
(5) the failure by the Company or the Corporation to (A)
continue in effect (without reduction in benefit level, and/or reward
opportunities) any material compensation or employee benefit plan in which the
Executive was participating immediately prior to the Change in Control,
including, but not limited to, any of the plans listed in Appendix A hereto,
unless a substitute or replacement plan has been implemented which provides
substantially identical compensation or benefits to the Executive or (B) provide
the Executive with compensation and benefits, in the aggregate, at least equal
(in terms of benefit levels and/or reward opportunities) to those provided for
under each other compensation or employee benefit plan, program and practice in
which the Executive was participating immediately prior to the Change in
Control;
(6) the failure of the Company or the Corporation to obtain
from its Successors or Assigns the express assumption and agreements required
under Section 11 hereof; or
(7) any purported termination of the Executive's employment
by the Company which is not effected pursuant to a Notice of Termination
satisfying the terms set forth in the definition of Notice of Termination (and,
if applicable, the terms set forth in the definition of Cause).
(b) Any event or condition (1) described in Section
15.9(a)(1), (2), (3), (4), (6) or (7) which occurs within twelve (12) months
prior to a Change in Control or (2) described in Section 15.9(a)(1) through (7)
which occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a Third Party who effectuates a Change in
Control or (B) otherwise arose in connection with, or in
14
<PAGE>
anticipation of a Change in Control which has been threatened or proposed and
which actually occurs, shall constitute Good Reason for purposes of this
Agreement notwithstanding that it occurred prior to a Change in Control.
15.10. Incentive Plan. For purposes of this Agreement, "Incentive
--------------
Plan" shall mean the Incentive Compensation Plan for Elected Officers, or any
successor annual incentive plan, maintained by the Company or any other
Affiliate.
15.11. Notice of Termination. For purposes of this Agreement,
---------------------
following a Change in Control, "Notice of Termination" shall mean a written
notice of termination of the Executive's employment, signed by the Executive if
to the Company or by a duly authorized officer of the Company if to the
Executive, which indicates the specific termination provision in this Agreement,
if any, relied upon and which sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.
15.12. Pro Rata Bonus. For purposes of this Agreement, "Pro Rata
--------------
Bonus" shall mean an amount equal to the Bonus Amount multiplied by a fraction
the numerator of which is the number of days in such fiscal year through the
Termination Date and the denominator of which is 365; provided, however, that
the Pro Rata Bonus shall be reduced, but not below zero, to the extent of any
bonus the Executive is entitled to receive pursuant to the Incentive Plan in
respect of the fiscal year (denoted a "Performance Period" under the Incentive
Plan) in which the Termination Date occurs.
15.13. Successors and Assigns. For purposes of this Agreement,
----------------------
"Successors and Assigns" shall mean, with respect to the Company or the
Corporation, a corporation or other entity acquiring all or substantially all
the assets and business of the Company or the Corporation, as the case may be
(including this Agreement) whether by operation of law or otherwise.
15.14. Termination Date
----------------
(a) For purposes of this Agreement, "Termination Date" shall
mean (i) in the case of the Executive's death, his date of death, (ii) if the
Executive's employment is terminated for Disability, thirty (30) days after
Notice of Termination is given (provided that the Executive shall not have
returned to the performance of his duties on a full-time basis during such
thirty (30) day period) and (iii)
15
<PAGE>
if the Executive's employment is terminated for any other reason, the date
specified in the Notice of Termination (which, in the case of a termination for
Cause shall not be less than thirty (30) days, and in the case of a termination
for Good Reason shall not be more than sixty (60) days, from the date such
Notice of Termination is given); provided, however, that if within thirty (30)
days after a Notice of Termination by the Company for Cause or a Notice of
Termination by the Executive for Good Reason is given the party receiving such
Notice of Termination in good faith notifies the other party that a dispute
exists concerning the basis for the termination, the provisions of paragraph (b)
shall apply.
(b)(i) If the Executive gives the Company Notice of Termination
for Good Reason and the Company disputes the basis for the termination, the
Termination Date shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, or by the final judgment,
order or decree of a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been taken) and the Company shall
continue to pay the Executive his Base Amount and continue the Executive as a
participant in all compensation, incentive, bonus, pension, profit sharing,
medical, hospitalization, dental, life insurance and disability benefit plans in
which he was participating when the notice giving rise to the dispute was given,
until such Termination Date, provided that if the Executive continues to perform
his duties with the Company during the pendency of such dispute, the Executive
shall not be obligated to repay to the Company any amounts paid or benefits
provided pursuant to this Section 15.14(b), and further provided that if the
Executive ceased performing his duties with the Company during the pendency of
such dispute, and the dispute is resolved in favor of the Executive, any amount
owed to the Executive pursuant to Section 2 of this Agreement shall be reduced
to the extent of any amount the Executive received pursuant to this Section
15.14(b) during the pendency of such dispute; and (ii) if the Company gives the
Executive Notice of Termination for Cause and the Executive disputes the basis
for the termination, the Termination Date shall be as determined pursuant to
Section 15.14(a) and during the pendency of such dispute the Executive shall not
be entitled to payment of his Base Amount from the Company and, except as
required by law, the Executive's participation in the Company's benefit plans
and programs shall be discontinued.
16
<PAGE>
IN WITNESS WHEREOF, the Corporation and the Company have caused this Agreement
to be executed by their duly authorized officers and the Executive has executed
this Agreement as of the day and year first above written.
GPU, Inc.
By: _______________________________
ATTEST: Fred D. Hafer
Chairman, President and
Chief Executive Officer
Officer
_________________________
Secretary
GPU Service, Inc.
By: _______________________________
ATTEST: Fred D. Hafer
Chairman, President and
Chief Executive Officer
_________________________
Secretary
By: _______________________________
Dennis P. Baldassari
17
<PAGE>
APPENDIX A
1. 1990 Stock Plan for Employees of GPU, Inc. and Subsidiaries
2. The Company's Incentive Plan
3. The GPU Companies Deferred Compensation Plan
4. The GPU Companies Employee Pension Plan
5. The Company's Supplemental and Excess Benefits Plan
6. The Company's Employee Life Insurance Plan
7. Senior Executive Split-Dollar Life Insurance Program
8. The GPU Companies Accident Insurance Plan
9. The GPU Companies Health Care Plan for Non-Bargaining Employees and the
Company's Health Care Plan for Non-bargaining Retirees, if applicable
10. The GPU Companies Supplemental Medical Expense Plan for Elected Officers
11. The GPU Companies Flexible Benefits Plan for Non-bargaining Employees
12. The GPU Companies Group Specified Disease Insurance Plan
13. The GPU Companies Long Term Disability Income Plan
14. The GPU Companies Employee Savings Plan
15. The Company's Vacation Policy for Non-Bargaining Unit Employees
18
<PAGE>
ASSIGNMENT AGREEMENT
WHEREAS, on November 5, 1998, Dennis P. Baldassari (the: Executive"), GPU, Inc.
(the "Corporation"), and Jersey Central Power & Light Company (the "Company")
entered into a Severance Protection Agreement (the "Agreement"); and
WHEREAS, it is expected that on or about January 1, 1999, the Executive's
employment with the Company will terminate by reason of his transfer of
employment to GPU Service, Inc., an Affiliate of the Corporation; and
WHEREAS, Section 5 of the Agreement provides as follows:
Transfer of Employment. Notwithstanding any other provision
----------------------
herein to the contrary, the Company shall cease to have any
further obligation or liability to the Executive under this
Agreement if (a) the Executive's employment with the
Company terminates as a result of the transfer of his
employment to any other Affiliate of the Corporation, (b)
this Agreement is assigned to such other Affiliate, and (c)
such other Affiliate expressly assumes and agrees to
perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if
no assignment had taken place. Any Affiliate to which this
Agreement is so assigned shall be treated as the "Company"
for all purposes of this Agreement on or after the date as
of which such assignment to the Affiliate, and the
Affiliate's assumption and agreement to so perform this
Agreement, becomes effective.
NOW, THEREFORE, the parties hereto agree as follows:
The Agreement is hereby assigned to GPU Service, Inc.
effective on the date the Executive becomes an employee of
GPU Service, Inc. by reason of his transfer of employment
from the Company (the "Transfer Date");
19
<PAGE>
GPU Service, Inc. shall and hereby does assume the
Agreement effective upon the Transfer Date, and from and
after the Transfer Date GPU Service, Inc. agrees to perform
the Agreement in the same manner and to the same extent
that the Company was required to perform prior thereto; and
20
<PAGE>
From and after the Transfer Date, the Company shall have no further
obligation or liability to the Executive under the Agreement.
GPU, Inc.
Date: ________________________ By:________________________
Fred D. Hafer
Chairman, President and
Chief Executive Officer
Jersey Central Power & Light Company
Date: ________________________ By:_______________________
Fred D. Hafer
Chairman of the Board and
Chief Executive Officer
GPU Service, Inc.
Date: _________________________ By:________________________
Fred D. Hafer
Chairman, President and
Chief Executive Officer
Date: _______________________ By:_______________________
Dennis P. Baldassari
21
<PAGE>
Exhiibit D-1
Amendment to Agreement of
GPU, Inc. and Its Subsidiaries
Related to Consolidated Federal Income Tax Returns
Dated May 26, 1983
________________________________________________________________________________
WHEREAS, GPU, Inc. ("GPU") and certain of its subsidiaries have entered
into the Agreement of GPU, Inc. and its Subsidiaries related to Consolidated
Federal Income Tax Returns, dated May 26, 1983 ("Tax Allocation Agreement");
WHEREAS, subsequent to the execution of the Tax Allocation Agreement,
additional GPU subsidiary corporations have been organized; and
WHEREAS, it is appropriate and desirable that such additional subsidiaries
formally become parties to the Tax Allocation Agreement to evidence their
agreement to the allocation of consolidated federal income taxes as therein
provided.
NOW THEREFORE, in consideration of the provisions, and other good and
valuable consideration, receipt of which is hereby acknowledged, the undersigned
has hereby executed the Tax Allocation Agreement as of the date indicated below:
ATTEST GPU Argentina Holdings, Inc.
By: ____________________________ ___________________________________
Robert L. Wise, President
December 20, 1998
<PAGE>
Amendment to Agreement of
GPU, Inc. and Its Subsidiaries
Related to Consolidated Federal Income Tax Returns
Dated May 26, 1983
________________________________________________________________________________
WHEREAS, GPU, Inc. ("GPU") and certain of its subsidiaries have entered
into the Agreement of GPU, Inc. and its Subsidiaries related to Consolidated
Federal Income Tax Returns, dated May 26, 1983 ("Tax Allocation Agreement");
WHEREAS, subsequent to the execution of the Tax Allocation Agreement,
additional GPU subsidiary corporations have been organized; and
WHEREAS, it is appropriate and desirable that such additional subsidiaries
formally become parties to the Tax Allocation Agreement to evidence their
agreement to the allocation of consolidated federal income taxes as therein
provided.
NOW THEREFORE, in consideration of the provisions, and other good and
valuable consideration, receipt of which is hereby acknowledged, the undersigned
has hereby executed the Tax Allocation Agreement as of the date indicated below:
ATTEST GPU Capital, Inc.
By: ____________________________ ___________________________________
Bruce L. Levy, President
October 11, 1998
<PAGE>
Amendment to Agreement of
GPU, Inc. and Its Subsidiaries
Related to Consolidated Federal Income Tax Returns
Dated May 26, 1983
________________________________________________________________________________
WHEREAS, GPU, Inc. ("GPU") and certain of its subsidiaries have entered
into the Agreement of GPU, Inc. and its Subsidiaries related to Consolidated
Federal Income Tax Returns, dated May 26, 1983 ("Tax Allocation Agreement");
WHEREAS, subsequent to the execution of the Tax Allocation Agreement,
additional GPU subsidiary corporations have been organized; and
WHEREAS, it is appropriate and desirable that such additional subsidiaries
formally become parties to the Tax Allocation Agreement to evidence their
agreement to the allocation of consolidated federal income taxes as therein
provided.
NOW THEREFORE, in consideration of the provisions, and other good and
valuable consideration, receipt of which is hereby acknowledged, the undersigned
has hereby executed the Tax Allocation Agreement as of the date indicated below:
ATTEST GPU Brasil, Inc.
By: ____________________________ ___________________________________
Bruce L. Levy, President
February 27, 1998
<PAGE>
Amendment to Agreement of
GPU, Inc. and Its Subsidiaries
Related to Consolidated Federal Income Tax Returns
Dated May 26, 1983
________________________________________________________________________________
WHEREAS, GPU, Inc. ("GPU") and certain of its subsidiaries have entered
into the Agreement of GPU, Inc. and its Subsidiaries related to Consolidated
Federal Income Tax Returns, dated May 26, 1983 ("Tax Allocation Agreement");
WHEREAS, subsequent to the execution of the Tax Allocation Agreement,
additional GPU subsidiary corporations have been organized; and
WHEREAS, it is appropriate and desirable that such additional subsidiaries
formally become parties to the Tax Allocation Agreement to evidence their
agreement to the allocation of consolidated federal income taxes as therein
provided.
NOW THEREFORE, in consideration of the provisions, and other good and
valuable consideration, receipt of which is hereby acknowledged, the undersigned
has hereby executed the Tax Allocation Agreement as of the date indicated below:
ATTEST Geddes II Corp.
By: ____________________________ ___________________________________
Bruce L. Levy, President
June 25, 1998
<PAGE>
Exhibit E-1
VENTURE DISCLOSURES
-------------------
Licensing of Computer Programs
to Nonassociated Companies
------------------------------
Pursuant to the provisions contained in the Securities and Exchange
Commission's (SEC) Order dated August 29, 1990 for SEC File No. 70-7675, neither
Jersey Central Power & Light Company, Metropolitan Edison Company nor
Pennsylvania Electric Company entered into any transactions nor recognized any
revenues during the calendar year 1998 for activity related to the licensing of
computer programs to nonassociated companies.
<PAGE>
Exhibit E-2
VENTURE DISCLOSURES
-------------------
Fiber Optic System Lease Agreements
with Nonassociated Companies
-----------------------------------
Pursuant to the provisions contained in the Securities and Exchange
Commission's (SEC) Order dated August 2, 1994 for SEC File No. 70-7850, neither
Jersey Central Power & Light Company, Metropolitan Edison Company nor
Pennsylvania Electric Company entered into any transactions nor recognized any
revenues during the calendar year 1998 for activity related to the fiber optic
systems lease agreements with nonassociated companies.
<PAGE>
Exhibit E-3
VENTURE DISCLOSURES
-------------------
Services to Non-Affiliated Utilities
------------------------------------
Pursuant to the provisions contained in the Securities and Exchange
Commission's (SEC) Order dated November 5, 1996 for SEC File No. 70-8805,
neither Jersey Central Power & Light Company, Metropolitan Edison Company nor
Pennsylvania Electric Company entered into any transactions nor recognized any
revenues during the calendar year 1998 for services provided to non-affiliated
utilities.
<PAGE>
Exhibit E-4
Form U-13-60
Mutual and Subsidiary Service Companies
Revised February 7, 1980
ANNUAL REPORT
FOR THE PERIOD
Beginning January 1, 1998 and Ending December 31, 1998
----------------- -------------------
TO THE
U.S. SECURITIES AND EXCHANGE COMMISSION
OF
GPU INTERNATIONAL, INC.
- ----------------------------------------------------------------------------
(Exact Name of Reporting Company)
A Subsidiary Service Company
-----------------------------------------------------------
("Mutual" or "Subsidiary")
Date of Incorporation August 31, 1990 If not Incorporated, Date of
---------------
Organization____________________
State or Sovereign Power under which Incorporated or Organized Delaware
-----------
1 Upper Pond Road
Location of Principal Executive Offices of Reporting Co. Parsippany, NJ 07054
--------------------
Name, title, and address of officer to whom correspondence concerning this
report should be addressed:
1 Upper Pond Road
R. L. Wise, President and CEO Parsippany, NJ 07054
- --------------------------------------------------------------------------------
(Name) (Title) (Address)
Name of Principal Holding Company Whose Subsidiaries are served by Reporting
Company:
GPU, INC.
- --------------------------------------------------------------------------------
<PAGE>
1
INSTRUCTIONS FOR USE OF FORM U-13-60
1. Time of Filing.--Rule 94 provides that on or before the first day of May
--------------
in each calendar year, each mutual service company and each subsidiary service
company as to which the Commission shall have made a favorable finding pursuant
to Rule 88, and every service company whose application for approval or
declaration pursuant to Rule 88 is pending shall file with the Commission an
annual report on Form U-13-60 and in accordance with the Instructions for that
form.
2. Number of Copies.--Each annual report shall be filed in duplicate. The
----------------
company should prepare and retain at least one extra copy for itself in case
correspondence with reference to the report become necessary.
3. Period Covered by Report.--The first report filed by any company shall
------------------------
cover the period from the date the Uniform System of Accounts was required to be
made effective as to that company under Rules 82 and 93 to the end of that
calendar year. Subsequent reports should cover a calendar year.
4. Report Format.--Reports shall be submitted on the forms prepared by the
-------------
Commission. If the space provided on any sheet of such form is inadequate,
additional sheets may be inserted of the same size as a sheet of the form or
folded to such size.
5. Money Amounts Displayed.--All money amounts required to be shown in
-----------------------
financial statements may be expressed in whole dollars, in thousands of dollars
or in hundred thousands of dollars, as appropriate and subject to provisions of
Regulation S-X (S210.3-01(b)).
6. Deficits Displayed.--Deficits and other like entries shall be indicated
------------------
by the use of either brackets or a parenthesis with corresponding reference in
footnotes. (Regulation S-X, S210.3-01(c))
7. Major Amendments or Corrections.--Any company desiring to amend or
-------------------------------
correct a major omission or error in a report after it has been filed with the
Commission shall submit an amended report including only those pages, schedules,
and entries that are to be amended or corrected. A cover letter shall be
submitted requesting the Commission to incorporate the amended report changes
and shall be signed by a duly authorized officer of the company.
8. Definitions.--Definitions contained in Instruction 01-8 to the Uniform
-----------
System of Accounts for Mutual Service Companies and Subsidiary Service
Companies, Public Utility Holding Company Act of 1935, as amended February 2,
1979 shall be applicable to words or terms used specifically within this Form U-
13-60.
9. Organization Chart.--The service company shall submit with each annual
------------------
report a copy of its current organization chart.
10. Methods of Allocation.--The service company shall submit with each annual
---------------------
report a listing of the currently effective methods of allocation being used by
the service company and on file with the Securities and Exchange Commission
pursuant to the Public Utility Holding Company Act of 1935.
11. Annual Statement of Compensation for Use of Capital Billed.--The service
----------------------------------------------------------
company shall submit with each annual report a copy of the annual statement
supplied to each associate company in support of the amount of compensation for
use of capital billed during the calendar year.
<PAGE>
2
<TABLE>
<CAPTION>
LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS Page
Number
- ------------------------------------------------------------------------------------
Description of Schedules and Accounts Schedule or Account
Number
- ------------------------------------------------------------------------------------
<S> <C> <C>
COMPARATIVE BALANCE SHEET Schedule I 4-5
- -------------------------
SERVICE COMPANY PROPERTY Schedule II 6-7
ACCUMULATED PROVISION FOR DEPRECIATION
AND AMORTIZATION OF SERVICE COMPANY PROPERTY Schedule III 8
INVESTMENTS Schedule IV 9
ACCOUNTS RECEIVABLE FROM ASSOCIATE
COMPANIES Schedule V 10
FUEL STOCK EXPENSES UNDISTRIBUTED Schedule VI 11
STORES EXPENSE UNDISTRIBUTED Schedule VII 12
MISCELLANEOUS CURRENT AND ACCRUED ASSETS Schedule VIII 13
MISCELLANEOUS DEFERRED DEBITS Schedule IX 14
RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES Schedule X 15
PROPRIETARY CAPITAL Schedule XI 16
LONG-TERM DEBT Schedule XII 17
CURRENT AND ACCRUED LIABILITIES Schedule XIII 18
NOTES TO FINANCIAL STATEMENTS Schedule XIV 19
COMPARATIVE INCOME STATEMENT Schedule XV 20
- ----------------------------
ANALYSIS OF BILLING - ASSOCIATE COMPANIES Account 457 21
ANALYSIS OF BILLING - NONASSOCIATE COMPANIES Account 458 22
ANALYSIS OF CHARGES FOR SERVICE - ASSOCIATE
AND NONASSOCIATE COMPANIES Schedule XVI 23
SCHEDULE OF EXPENSE BY DEPARTMENT OR
SERVICE FUNCTION Schedule XVII 24-25
DEPARTMENTAL ANALYSIS OF SALARIES Account 920 26
OUTSIDE SERVICES EMPLOYED Account 923 27
EMPLOYEE PENSIONS AND BENEFITS Account 926 28
GENERAL ADVERTISING EXPENSES Account 930.1 29
MISCELLANEOUS GENERAL EXPENSES Account 930.2 30
RENTS Account 931 31
DEPRECIATION AND AMORTIZATION Account 403 32
TAXES OTHER THAN INCOME TAXES Account 408 33
DONATIONS Account 426.1 34
OTHER DEDUCTIONS Account 426.5 35
NOTES TO STATEMENT OF INCOME Schedule XVIII 36
</TABLE>
<PAGE>
3
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
LISTING OF INSTRUCTIONAL FILING REQUIREMENTS Page
Number
- --------------------------------------------------------------------------------
<S> <C>
Description of Reports of Statements
- --------------------------------------------------------------------------------
ORGANIZATION CHART 37
- ------------------
METHODS OF ALLOCATION 38
- ---------------------
ANNUAL STATEMENT OF COMPENSATION FOR USE 39
- ----------------------------------------
OF CAPITAL BILLED
- -----------------
VENTURE DISCLOSURES 40
- -------------------
EXHIBIT 41
- -------
</TABLE>
NOTE: Dollar figures in this report are shown in thousands unless otherwise
noted.
<PAGE>
4
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
------------------------
- --------------------------------------------------------------------------------
SCHEDULE I - COMPARATIVE BALANCE SHEET
--------------------------------------
Give balance sheet of the Company as of December 31 of the current and prior
year.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
ACCOUNT ASSETS AND OTHER DEBITS AS OF DECEMBER 31
- --------------------------------------------------------------------------------------------------
CURRENT PRIOR
------- -----
<S> <C> <C> <C>
SERVICE COMPANY PROPERTY
------------------------
101 Service company property (Schedule II) $107,312 $ 2,775
107 Construction work in progress (Schedule II) - 126,665
-------- --------
Total Property 107,312 129,440
108 Less accumulated provision for depreciation
and amortization of service company
property (Schedule III) 20,470 1,068
-------- --------
Net Service Company Property 86,842 128,372
-------- --------
INVESTMENTS
-----------
123 Investments in assoc. companies (Schedule IV) 63,373 65,564
124 Other investments (Schedule IV) 33,125 47,493
-------- --------
Total Investments 96,498 113,057
-------- --------
CURRENT AND ACCRUED ASSETS
--------------------------
131 Cash 4,589 4,203
134 Special deposits 11,643 16,102
135 Working funds - -
136 Temporary cash investments (Schedule IV) 20,846 -
141 Notes receivable 20,389 28,226
143 Accounts receivable 20,752 10,778
144 Accumulated provision for uncollectible
accounts (5,012) -
146 Accounts receivable from associate
companies (Schedule V) 24,392 7,536
152 Fuel stock expenses undistributed
(Schedule VI) 228 -
154 Materials and supplies 675 -
163 Stores expense undistributed (Schedule VII) - -
165 Prepayments 1,922 1,717
171 Interest Receivable 1,826 132
174 Miscellaneous current and accrued
assets (Schedule VIII) 71,716 4,318
-------- --------
Total Current and Accrued Assets 173,966 73,012
-------- --------
DEFERRED DEBITS
---------------
181 Unamortized debt expense - -
184 Clearing accounts - -
186 Miscellaneous deferred debits (Schedule IX) - 1,258
188 Research, development, or demonstration
expenditures (Schedule X) - -
190 Accumulated deferred income taxes 40,217 2,892
-------- --------
Total Deferred Debits 40,217 4,150
-------- --------
TOTAL ASSETS AND OTHER DEBITS $397,523 $318,591
======== ========
</TABLE>
<PAGE>
5
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
SCHEDULE I - COMPARATIVE BALANCE SHEET
--------------------------------------
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
ACCOUNT LIABILITIES AND PROPRIETARY CAPITAL AS OF DECEMBER 31
- ----------------------------------------------------------------------------------------------
CURRENT PRIOR
------- -----
<S> <C> <C> <C>
PROPRIETARY CAPITAL
-------------------
201 Common stock issued (Schedule XI) $ 100 $ -
211 Miscellaneous paid-in-capital (Schedule XI) 144,466 136,466
215 Appropriated retained earnings (Schedule XI) - -
216 Unappropriated retained earnings (deficit)
(Schedule XI) (11,622) (19,291)
-------- --------
Total Proprietary Capital 132,944 117,275
-------- --------
LONG-TERM DEBT
--------------
223 Advances from assoc. companies (Schedule XII) - -
224 Other long-term debt (Schedule XII) - 124,600
225 Unamortized premium on long-term debt - -
226 Unamortized discount on long-term debt-debit - -
-------- --------
Total Long-term Debt - 124,600
-------- --------
CURRENT AND ACCRUED LIABILITIES
-------------------------------
231 Notes payable 11,600 1,500
232 Accounts payable 8,736 9,588
233 Notes payable to associate
companies (Schedule XIII) - -
234 Accounts payable to associate
companies (Schedule XIII) 19,365 6,600
236 Taxes accrued - -
237 Interest accrued - 2,138
238 Dividends declared - -
241 Tax collections payable - 307
242 Miscellaneous current and accrued
liabilities (Schedule XIII) 16,942 17,163
-------- --------
Total Current and Accrued Liabilities 56,643 37,296
-------- --------
DEFERRED CREDITS
----------------
253 Other deferred credits 198,646 29,986
255 Accumulated deferred investment tax credits - -
-------- --------
Total Deferred Credits 198,646 29,986
-------- --------
282 ACCUMULATED DEFERRED INCOME TAXES 9,290 9,434
---------------------------------
-------- --------
TOTAL LIABILITIES AND PROPRIETARY CAPITAL $397,523 $318,591
======== ========
</TABLE>
<PAGE>
6
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE II - SERVICE COMPANY PROPERTY
--------------------------------------
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
BALANCE AT BALANCE AT
BEGINNING RETIREMENTS OTHER CLOSE OF
DESCRIPTION OF YEAR ADDITIONS OR SALES CHANGES 1/ YEAR
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
SERVICE COMPANY PROPERTY
- ------------------------
Account
- -------
301 ORGANIZATION
303 MISCELLANEOUS
INTANGIBLE PLANT
304 LAND & LAND RIGHT $ 152 $ 901 $ (152) $ - $ 901
305 STRUCTURES AND
IMPROVEMENTS
306 LEASEHOLD
IMPROVEMENTS 779 61 - - 840
307 EQUIPMENT 2/ 16 129 (36) - 109
308 OFFICE FURNITURE
AND EQUIPMENT 1,807 568 (104) - 2,271
309 AUTOMOBILES, OTHER
VEHICLES AND
RELATED GARAGE
EQUIPMENT 21 21 (10) - 32
310 AIRCRAFT AND
AIRPORT EQUIPMENT
311 OTHER SERVICE
COMPANY PROPERTY 3/ - 238,638 - (135,479) 103,159
--------- --------- ------- ---------- ---------
SUB-TOTAL 2,775 240,318 (302) (135,479) 107,312
--------- --------- ------- ---------- ---------
107 CONSTRUCTION WORK
IN PROGRESS 4/ 126,665 6,945 (133,610) -
--------- --------- ------- ---------- ---------
TOTAL $ 129,440 $ 247,263 $ (302) $ (269,089) $ 107,312
========= ========= ======= ========== =========
- -----------------------------------------------------------------------------------------------------
</TABLE>
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
- -
<PAGE>
7
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE II - CONTINUED
-----------------------
- --------------------------------------------------------------------------------
2/ SUBACCOUNTS ARE REQUIRED FOR EACH CLASS OF EQUIPMENT OWNED. THE SERVICE
- -
COMPANY SHALL PROVIDE A LISTING BY SUBACCOUNT OF EQUIPMENT ADDITIONS
DURING THE YEAR AND THE BALANCE AT THE CLOSE OF THE YEAR:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
BALANCE AT
SUBACCOUNT DESCRIPTION ADDITIONS CLOSE OF
YEAR
----------
<S> <C> <C>
N/A
------ ------
TOTAL $ - $ -
====== ======
</TABLE>
- --------------------------------------------------------------------------------
3/ DESCRIBE OTHER SERVICE COMPANY PROPERTY:
- -
THE SERVICE COMPANY PROPERTY ACCOUNT REPRESENTS A 300 MEGAWATT GAS AND OIL FIRED
COGENERATION FACILITY LOCATED IN KATHLEEN, GEORGIA WHICH WAS PLACED INTO
COMMERCIAL OPERATION IN JUNE 1998. ENERGY AND CAPACITY IS BEING SOLD TO GEORGIA
POWER COMPANY AND STEAM IS BEING SOLD TO THE ADJOINING FRITO-LAY PLANT.
- --------------------------------------------------------------------------------
4/ DESCRIBE CONSTRUCTION WORK IN PROGRESS:
- -
THE CONSTRUCTION WORK IN PROGRESS ACCOUNT REPRESENTS THE END OF CONSTRUCTION AND
THE BEGINNING OF COMMERCIAL OPERATION OF THE AFOREMENTIONED PLANT IN ITEM 3
UNDER A 30-YEAR POWER PURCHASE AGREEMENT (AGREEMENT). THE AGREEMENT IS IN PLACE
FOR THE PLANT TO SELL CAPACITY AND ENERGY ON A DISPATCHABLE BASIS TO GEORGIA
POWER COMPANY AND STEAM TO FRITO LAY.
<PAGE>
8
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
------------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE III
------------
ACCUMULATED PROVISION FOR DEPRECIATION AND
AMORTIZATION OF SERVICE COMPANY PROPERTY
----------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
BALANCE AT ADDITIONS BALANCE AT
BEGINNING CHARGED TO OTHER CHANGES CLOSE OF
DESCRIPTION OF YEAR ACCOUNT 403 RETIREMENTS ADD (DEDUCT)1/ YEAR
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Account
- -------
301 ORGANIZATION
303 MISCELLANEOUS
INTANGIBLE PLANT
304 LAND & LAND RIGHTS
305 STRUCTURES AND
IMPROVEMENTS
306 LEASEHOLD
IMPROVEMENTS $ 50 $ 45 $ - - $ 95
307 EQUIPMENT - 89 89
308 OFFICE FURNITURE
AND FIXTURES 1,007 421 - - $ 1,428
309 AUTOMOBILES, OTHER
VEHICLES AND
RELATED GARAGE
EQUIPMENT 11 5 - - 16
310 AIRCRAFT AND
AIRPORT EQUIPMENT
311 OTHER SERVICE
COMPANY PROPERTY - 18,842 18,842
------- ------- ------- ------- -------
$ 1,068 $19,402 $ - - $20,470
======= ======= ======= ======= =======
</TABLE>
- --------------------------------------------------------------------------------
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
- -
N/A
<PAGE>
9
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE IV - INVESTMENTS
-------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Complete the following schedule concerning investments.
Under Account 124, "Other Investments", state each investment separately, with
description, including, the name of issuing company, number of shares or
principal amount, etc.
Under Account 136, "Temporary Cash Investments", list each investment
separately.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
BALANCE AT BALANCE AT
DESCRIPTION BEGINNING CLOSE OF
OF YEAR YEAR
- --------------------------------------------------------------------------------
<S> <C> <C>
ACCOUNT 136 - TEMPORARY CASH INVESTMENTS
GEDDES COGENERATION CORPORATION $ 0 $20,846
======= =======
ACCOUNT 123 - INVESTMENT IN ASSOCIATE COMPANIES
PRIME ENERGY LIMITED PARTNERSHIP $ 7,410 $11,234
ONONDAGA COGENERATION LIMITED PARTNERSHIP 13,513 213
LAKE COGEN LIMITED PARTNERSHIP 16,338 9,024
PASCO COGEN LIMITED 16,199 15,128
SELKIRK CORPORATION PARTNERS, L.P. 12,105 9,040
SYRACUSE ORANGE PARTNERS - (180)
MID-GEORGIA COGENERATION LIMITED PARTNERSHIP - 18,914
------- -------
TOTAL $65,565 $63,373
======= =======
ACCOUNT 124 - OTHER INVESTMENTS
GPU SOLAR (INVESTMENT 50% OWNERSHIP) $ (13) $ 166
CO. OWNED LIFE INSURANCE -
CASH SURRENDER VALUE 68 93
BALLARD GENERATION SYSTEMS, INC. (EQUITY
INVESTMENT 10.65% OWNERSHIP) 10,773 14,030
CARRIED INTEREST - SYRACUSE ORANGE PARTNERS 1,886 1,125
LONG-TERM RECEIVABLES - ASSOCIATE COMPANIES 17,288 -
INTANGIBLE ASSETS - NCP ACQUISITION 16,243 15,792
ENVIROTECH INVESTMENT FUND 1,151 1,822
BALLARD POWER SYSTEMS, INC. (WARRANTS TO
ACQUIRE 100,000 COMMON SHARES) 97 97
------- -------
TOTAL $47,493 $33,125
======= =======
</TABLE>
<PAGE>
10
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
---------------------------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
BALANCE AT BALANCE AT
DESCRIPTION BEGINNING CLOSE OF
OF YEAR YEAR
- --------------------------------------------------------------------------------
<S> <C> <C>
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM ASSOCIATE
COMPANIES $ 7,536 $24,392
------- -------
TOTAL $ 7,536 $24,392
======= =======
- --------------------------------------------------------------------------------
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
--------
N/A
-------
TOTAL PAYMENTS -
=======
</TABLE>
<PAGE>
11
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE VI - FUEL STOCK EXPENSES UNDISTRIBUTED
-----------------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to
fuel stock expenses during the year and indicate amount
attributable to each associate company. Under the section headed
"Summary" listed below give an overall report of the fuel
functions performed by the service company.
<PAGE>
12
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED
-------------------------------------------
INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to
stores expense during the year and indicate amount attributable
to each associate company.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
DESCRIPTION LABOR EXPENSES TOTAL
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
ACCOUNT 163 - STORES EXPENSE UNDISTRIBUTED
N/A
----- ----- -----
TOTAL - - -
===== ===== =====
</TABLE>
<PAGE>
13
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE VIII
-------------
MISCELLANEOUS CURRENT AND ACCRUED ASSETS
----------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000
may be grouped, showing the number of items in each group.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
BALANCE AT BALANCE AT
DESCRIPTION BEGINNING CLOSE OF
OF YEAR YEAR
- --------------------------------------------------------------------------------
<S> <C> <C>
ACCOUNT 174 - MISCELLANEOUS CURRENT AND ACCRUED
ASSETS
MINORITY INTEREST - LAKE COGEN $4,318 $ 4,250
SWAP CONTRACT - ONONDAGA COGEN - 62,395
SECURITY DEPOSITS - ONONDAGA COGEN - 5,071
------ -------
TOTAL $4,318 $71,716
====== =======
</TABLE>
<PAGE>
14
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE IX - MISCELLANEOUS DEFERRED DEBITS
-------------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000
may be grouped by class showing the number of items in each
class.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
BALANCE AT BALANCE AT
DESCRIPTION BEGINNING CLOSE OF
OF YEAR YEAR
- --------------------------------------------------------------------------------
<S> <C> <C>
ACCOUNT 186 - MISCELLANEOUS DEFERRED DEBITS
DEFERRED FINANCING COSTS $1,258 $ -
</TABLE>
<PAGE>
15
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE X
----------
RESEARCH, DEVELOPMENT OR DEMONSTRATION EXPENDITURES
---------------------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide a description of each material research, development, or
demonstration project which incurred costs by the service
corporation during the year.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
<S> <C>
ACCOUNT 188 - RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES
N/A
</TABLE>
<PAGE>
16
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------
For the Year Ended December 31, 1998
-----------------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
SCHEDULE XI - PROPRIETARY CAPITAL
- ---------------------------------------------------------------------------------------------------------------------
NUMBER OF PAR OR STATED
SHARES VALUE OUTSTANDING CLOSE OF PERIOD
---------------------------
ACCOUNT NUMBER CLASS OF STOCK AUTHORIZED PER SHARE NO. OF SHARES TOTAL AMOUNT
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
201 COMMON STOCK ISSUED 100 $1 000* 100 $100, 000*
- ---------------------------------------------------------------------------------------------------------------------
INSTRUCTIONS: Classify amounts in each account with brief explanation, disclosing
the general nature of transactions which gave rise to the reported
amounts.
- ---------------------------------------------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- ---------------------------------------------------------------------------------------------------------------------
ACCOUNT 211 - MISCELLANEOUS PAID-IN CAPITAL $ 144,466
ACCOUNT 215 - APPROPRIATED RETAINED EARNINGS 0
---------
TOTAL $144,466
========
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
INSTRUCTIONS: Give particulars concerning net income or (loss) during the
year, distinguishing between compensation for the use of
capital owed or net loss remaining from servicing
nonassociates per the General Instructions of the Uniform
System of Accounts. For dividends paid during the year in
cash or otherwise, provide rate percentage, amount of
dividend, date declared and date paid.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
BALANCE AT NET INCOME CUMULATIVE UNREALIZED BALANCE AT
BEGINNING OR TRANSLATION GAIN ON CLOSE OF
DESCRIPTION OF YEAR (LOSS) ADJUSTMENT MES YEAR
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ACCOUNT 216 - UNAPPROPRIATED RETAINED EARNINGS (26,247) 11,724 3 - (14,520)
Unrealized Gain on Marketable
Equity Securities (MES) - - - 2,898 2,898
--------- --------- -------- -------- --------
TOTAL $ (26,247) $ 11,724 $ 3 $ 2,898 $(11,622)
========= ========= ======== ======== ========
</TABLE>
* In Whole Dollars
<PAGE>
17
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE XII- LONG-TERM DEBT
- --------------------------------------------------------------------------------
INSTRUCTIONS: Advances from associate companies should be reported
separately for advances on notes, and advances on open
account. Names of associate companies from which advances
were received shall be shown under the class and series of
obligation column. For Account 224 - Other long term debt
provide the name of creditor company or organization, terms
of the obligation, date of maturity, interest rate, and the
amount authorized and outstanding.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
TERMS OF OBLIG DATE BALANCE AT BALANCE AT
NAME OF CREDITOR CLASS & SERIES OF INTEREST AMOUNT BEGINNING 1/ CLOSE
-
OF OBLIGATION MATURITY RATE AUTHORIZED OF YEAR ADDITIONS DEDUCTIONS OF YEAR
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ACCOUNT 223 - ADVANCES FROM ASSOCIATE
COMPANIES:
NONE
ACCOUNT 224 - OTHER LONG-TERM DEBT: NONE $124,600 $124,600 $ -
1/ GIVE AN EXPLANATION OF DEDUCTIONS: Payments per agreements. $124,600 $124,600 $ -
======== ======== =====
</TABLE>
<PAGE>
18
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE XIII - CURRENT AND ACCRUED LIABILITIES
-----------------------------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide balance of notes and accounts payable to each associate
company. Give description and amount of miscellaneous current and
accrued liabilities. Items less than $10,000 may be grouped,
-------
showing the number of items in each group.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
BALANCE AT BALANCE AT
DESCRIPTION BEGINNING END
OF YEAR OF YEAR
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
ACCOUNT 233 - NOTES PAYABLE TO ASSOCIATE COMPANIES
NONE
-------- -------
TOTAL - -
======== =======
- ---------------------------------------------------------------------------------------
ACCOUNT 234 - ACCOUNTS PAYABLE TO ASSOCIATE
COMPANIES
GPU SERVICE CORPORATION $ 1,224 $ 986
SYRACUSE ORANGE PARTNERS 75 -
GPU ELECTRIC 5,085 18,379
MID-GEORGIA 216 -
-------- -------
TOTAL $ 6,600 $19,365
======== =======
- ---------------------------------------------------------------------------------------
ACCOUNT 242 - MISCELLANEOUS CURRENT AND ACCRUED
LIABILITIES
ACCRUALS - EMPLOYEE BONUS 823 1,283
- VACATION 779 810
- LEGAL FEES 403 1,345
- CONSULTING - 202
- ACCRUED CONST. CONTIN. 3,280 -
- ACCRUED OVERHAUL 3,841 8,589
- OTHER 5,860 4,555 A
- INTEREST PAYABLE 2,138 -
- ACCRUED AUDIT FEES - - 158
- 8 ITEMS LESS THAN $10,000 39 -
-------- -------
TOTAL $ 17,163 $16,942
======== =======
A OCLP 476
EI SERVICES, INC. 39
LAKE 28
MID-GEORGIA COGEN CONSOLIDATED 13
EI SELKIRK 53
GPUI 3,910
EI FUELS 35
OTHER 1
-------
$ 4,555
=======
</TABLE>
<PAGE>
19
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE XIV
------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: The space below is provided for important notes regarding the
financial statements or any account thereof. Furnish particulars
as to any significant contingent assets or liabilities existing
at the end of the year. Notes relating to financial statements
shown elsewhere in this report may be indicated here by
reference.
- --------------------------------------------------------------------------------
The Notes to Financial Statements of GPU International, Inc. will be filed
separately under a request for confidential treatment under Rule 104(b).
<PAGE>
20
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-------------------------
For the Year Ended December 31, 1998
-----------------
________________________________________________________________________________
SCHEDULE XV
-----------
STATEMENT OF INCOME
-------------------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
ACCOUNT DESCRIPTION CURRENT YEAR PRIOR YEAR
- ------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
INCOME
------
457 Services rendered to associate companies $ 72,256 $ 38,727
458 Services rendered to nonassociate companies - -
421 Equity earnings (losses) 7,523 (11,421)
421 Interest and dividend income 3,489 2,497
421 Gain on sale of asset 9,146 (950)
-------- --------
Total Income 92,414 28,853
-------- --------
EXPENSE
- --------------------
920 Salaries and wages 7,251 6,263
921 Office supplies and expenses 137 405
922 Administrative expense transferred
credit - -
923 Outside services employed 7,593 7,610
924 Property insurance 149 173
925 Injuries and damages - -
926 Employee pensions and benefits 2,518 1,200
928 Regulatory commission expense - -
930.1 General advertising expenses 5 -
930.2 Miscellaneous general expenses 52,683 26,600
931 Rents 759 722
932 Maintenance of structures and equipment - -
403 Depreciation and amortization expense 4,560 500
408 Taxes other than income taxes 492 656
409 Income taxes (3,991) (1,594)
410 Provision for deferred income taxes 13,094 (1,521)
411 Provision for deferred income taxes -
credit - -
411.5 Investment tax credit - -
426.1 Donations 7 20
426.5 Other deductions (5,213) 468
427 Interest on long-term debt 748 112
430 Interest on debt to associate
companies - -
431 Other interest expense - 601
-------- --------
Total Expense 80,792 42,215
-------- --------
Net Income or (Loss) $ 11,622 $(13,362)
======== ========
</TABLE>
<PAGE>
21
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------------
For the Year Ended December 31, 1998
-----------------
________________________________________________________________________________
ANALYSIS OF BILLING
-------------------
ASSOCIATE COMPANIES
ACCOUNT 457
________________________________________________________________________________
<TABLE>
<CAPTION>
COSTS DIRECT INDIRECT COMPENSATION
NAME OF ASSOCIATE COMPANY COSTS FOR USE AMOUNT TOTAL
CHARGED CHARGE OF CAPITAL BILLED
-------------------------------------------
457-1 457-2 457-3
-------------------------------------------
<S> <C> <C> <C> <C>
PRIME ENERGY LIMITED PARTNERSHIP $ 1,993 $ - $ - $ 1,993
CAMCHINO ENERGY CORPORATION 336 - - 336
ONONDAGA COGENERATION LIMITED
PARTNERSHIP 14,336 - - 14,336
EI SERVICES CANADA 779 - - 779
TERMOBARRANQUILLA, S.A. EMPRESA
DE SERVICIOS PUBLICOS (TEBSA) 2,196 - - 2,196
LAKE COGEN LIMITED 34,640 - - 34,640
PROJECT ORANGE ASSOCIATES 363 - - 363
MID GEORGIA COGEN 344 - - 344
PASCO COGEN LIMITED 195 - - 195
EI SERVICES, INC. 8,305 - - 8,305
GEDDES COGENERATION COPORATION 2,660 - - 2,660
NCP ENERGY, INC. 3,218 - - 3,218
EI FUELS, INC. 330 - - 330
GPU POWER,INC. 2,429 - - 2,429
NCP HOUSTON POWER, INC. 132 - - 132
------- ----- ----- -------
TOTAL $72,256 $ - $ - $72,256
======= ===== ===== =======
</TABLE>
<PAGE>
22
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
----------------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
ANALYSIS OF BILLING
-------------------
NONASSOCIATE COMPANIES
ACCOUNT 458
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
DIRECT INDIRECT COMPENSATION EXCESS
COSTS COSTS FOR USE TOTAL OR TOTAL
NAME OF NONASSOCIATE COMPANY CHARGED CHARGED OF CAPITAL COST DEFICIENCY AMOUNT
------- -------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
458-1 458-2 458-3 458-4 BILLED
- ------------------------------------------------------------------------------------------
NOT APPLICABLE
- --------------------------------------------------------------------------------
</TABLE>
INSTRUCTION: Provide a brief description of the services rendered to each
nonassociated company:
<PAGE>
23
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-------------------------
For the Year Ended December 31, 1998
-----------------
________________________________________________________________________________
SCHEDULE XVI
------------
ANALYSIS OF CHARGES FOR SERVICE
-------------------------------
ASSOCIATE AND NONASSOCIATE COMPANIES
------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
ASSOCIATE COMPANY CHARGES NONASSOC. CO. CHARGES TOTAL CHARGES FOR SERVICE
------------------------- --------------------- -------------------------
DIRECT INDIRECT DIRECT INDIRECT DIRECT INDIRECT
DESCRIPTION OF ITEMS COST COST TOTAL COST COST TOTAL COST COST TOTAL
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES
921 OFFICE SUPPLIES AND EXPENSES
922 ADMINISTRATIVE EXPENSE TRANSFERRED-
CREDIT
923 OUTSIDE SERVICES EMPLOYED NOT APPLICABLE
924 PROPERTY INSURANCE
925 INJURIES AND DAMAGES
926 EMPLOYEE PENSIONS AND BENEFITS
928 REGULATORY COMMISSION EXPENSE
930.1 GENERAL ADVERTISING EXPENSES
930.2 MISCELLANEOUS GENERAL EXPENSES
931 RENTS
932 MAINTENANCE OF STRUCTURES AND
EQUIPMENT
403 DEPRECIATION AND AMORTIZATION
EXPENSE
408 TAXES OTHER THAN INCOME TAXES
409 INCOME TAXES
410 PROVISION FOR DEFERRED INCOME TAXES
411 PROVISION FOR DEFERRED INCOME TAXES
- CREDIT
411.5 INVESTMENT TAX CREDIT
426.1 DONATIONS
426.5 OTHER DEDUCTIONS
427 INTEREST ON LONG-TERM DEBT
430 INTEREST ON DEBT TO ASSOCIATE
COMPANIES
431 OTHER INTEREST EXPENSE
</TABLE>
______________________________________________________
INSTRUCTION: Total cost of service will equal
for associate and nonassociate
companies the total amount billed
under their separate analysis of
billing schedules.
______________________________________________________
TOTAL EXPENSES =
COMPENSATION FOR USE OF EQUITY CAPITAL =
430 INTEREST ON DEBT TO ASSOCIATE
COMPANIES =
TOTAL COST OF SERVICE =
------------------------------
<PAGE>
24
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-------------------------
For the Year Ended December 31, 1998
-----------------
________________________________________________________________________________
SCHEDULE XVII
-------------
SCHEDULE OF EXPENSE DISTRIBUTION
--------------------------------
BY
DEPARTMENT OR SERVICE FUNCTION
________________________________________________________________________________
DEPARTMENT OR SERVICE FUNCTION
------------------------------
<TABLE>
<CAPTION>
TOTAL OFFICE OF OYSTER THREE MILE THREE MILE
D E S C R I P T I O N O F I T E M S AMOUNT OVERHEAD PRESIDENT CREEK ISLAND I ISLAND II
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES
921 OFFICE SUPPLIES AND EXPENSES
922 ADMINISTRATIVE EXPENSE TRANSFERRED -
CREDIT
923 OUTSIDE SERVICES EMPLOYED
924 PROPERTY INSURANCE
925 INJURIES AND DAMAGES
926 EMPLOYEE PENSIONS AND BENEFITS NOT APPLICABLE
928 REGULATORY COMMISSION EXPENSE
930.1 GENERAL ADVERTISING EXPENSE
930.2 MISCELLANEOUS GENERAL EXPENSES
931 RENTS
932 MAINTENANCE OF STRUCTURES AND
EQUIPMENT
403 DEPRECIATION AND AMORTIZATION
EXPENSE
408 TAXES OTHER THAN INCOME TAXES
409 INCOME TAXES
410 PROVISION FOR DEFERRED INCOME TAXES
411 PROVISION FOR DEFERRED INCOME TAXES
- CREDIT
411.5 INVESTMENT TAX CREDIT
426.1 DONATIONS
426.5 OTHER DEDUCTIONS
427 INTEREST ON LONG-TERM DEBT
430 INTEREST ON DEBT TO ASSOCIATE
COMPANIES
431 OTHER INTEREST EXPENSE
</TABLE>
____________________________________________
INSTRUCTION: Indicate each department or
service function. (See Instruc-
tion 01-3 General Structure of
Accounting System: Uniform
System Account)
_______________________________
________________________________________________________________________________
TOTAL EXPENSES =
____________________________
<PAGE>
25
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-------------------------
For the Year Ended December 31, 1998
-----------------
- ----------------------------------------------------------------------------
SCHEDULE XVII
-------------
SCHEDULE OF EXPENSE DISTRIBUTION
--------------------------------
BY
DEPARTMENT OR SERVICE FUNCTION
- ----------------------------------------------------------------------------
D E P A R T M E N T OR S E R V I C E F U N C T I O N
- ----------------------------------------------------------------------------
ACCOUNT TECHNICAL NUCLEAR COMMUN- ADMIN & CORPORATE CORPORATE
NUMBER FUNCTIONS ASSURANCE CATIONS FINANCE SERVICES SECRETARY
- ----------------------------------------------------------------------------
920
921
922
923
924
925
926
928
930.1
930.2
931
932
403
408
409
410
411
411.5
426.1
426.5
427
430
431
- ----------------------------------------------------------------------------
TOTAL
- ----------------------------------------------------------------------------
<PAGE>
26
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-------------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
DEPARTMENTAL ANALYSIS OF SALARIES
---------------------------------
ACCOUNT 920
- --------------------------------------------------------------------------------
DEPARTMENTAL SALARY EXPENSE NUMBER
----------------------------------------
NAME OF DEPARTMENT INCLUDED IN AMOUNTS BILLED TO PERSONNEL
- ------------------ ------------------------------- ----------
Indicate each department TOTAL SALARY OTHER NON END OF
or service function. AMOUNT EXPENSE ASSOCIATES ASSOCIATES YEAR
- --------------------------------------------------------------------------------
GPU International, Inc. $7,251 $7,251 $ - $ - 83
------- ------- ------ ------ -----
TOTAL $ 7,251 $ 7,251 $ - $ - 83
======= ======= ====== ====== =====
<PAGE>
27
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
OUTSIDE SERVICES EMPLOYED
-------------------------------
ACCOUNT 923
________________________________________________________________________________
INSTRUCTIONS: Provide a breakdown by subaccount of outside services employed.
If the aggregate amounts paid to any one payee and included
within one subaccount is less than $25,000, only the aggregate
number and amount of all such payments included within the
subaccount need be shown. Provide a subtotal for each type of
service.
________________________________________________________________________________
RELATIONSHIP
------------
"A"=ASSOCIATE
FROM WHOM PURCHASED ADDRESS "NA"- NON AMOUNT
ASSOCIATE
________________________________________________________________________________
Schedule of Outside Services Employed for GPU International, Inc. will be filed
separately under a request for confidential treatment.
ACCOUNTING SERVICES $ 470
GENERAL & ADMINISTRATIVE EXPENSES 774
CONSULTING EXPENSES 2,548
LEGAL EXPENSES 1,966
OTHER DEVELOPMENT FEES 1,835
------
TOTAL $7,593
======
<PAGE>
28
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
EMPLOYEE PENSIONS AND BENEFITS
------------------------------
ACCOUNT 926
-----------
INSTRUCTIONS: Provide a listing of each pension plan and benefit program
provided by the service company. Such listing should be limited
to $25,000.
________________________________________________________________________________
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
HEALTH AND DENTAL INSURANCE $ 534
PENSION PLANS 224
EMPLOYEE SAVINGS PLAN 250
VACATION ACCRUAL 38
DEFERRED COMPENSATION 245
BONUS 1,326
OTHER PAYROLL EXPENSES 672
ALLOCATION OF SALARIES (771)
-----
------
TOTAL $ 2,518
======
<PAGE>
29
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
________________________________________________________________________________
GENERAL ADVERTISING EXPENSES
----------------------------
ACCOUNT 930.1
-------------
________________________________________________________________________________
INSTRUCTIONS: Provide a listing of the amount included in Account 930.1,
"General Advertising Expenses", classifying the items according
to the nature of the advertising and as defined in the account
definition. If a particular class includes an amount in excess of
$3,000 applicable to a single payee, show separately the name of
the payee and the aggregate amount applicable thereto.
________________________________________________________________________________
DESCRIPTION NAME OF PAYEE AMOUNT *
________________________________________________________________________________
No one Vendor's
invoice exceeded $3,000 Not applicable $ 5,000
------
TOTAL $ 5,000
======
* In Whole Dollars
<PAGE>
30
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
MISCELLANEOUS GENERAL EXPENSES
------------------------------
ACCOUNT 930.2
-------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide a listing of the amount included in Account 930.2,
"Miscellaneous General Expenses", classifying such expenses
according to their nature. Payments and expenses permitted by
Section 321 (b) (2) of the Federal Election Campaign Act, as
amended by Public Law 94-283 in 1976 (2 U.S.C.S. 441 (b) (2)
shall be separately classified.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
DESCRIPTION AMOUNT
- --------------------------------------------------------------------------------
<S> <C>
EMPLOYEE TRAVEL EXPENSE $ 653
EMPLOYEE RECRUITING AND RELOCATION EXPENSE 734
EMPLOYEE TRAINING EXPENSE 121
OPERATING EXPENSES - LAKE COGEN 15,360
OPERATING EXPENSES - ONONDAGA COGEN 4,629
COMPUTER EXPENSE 324
TEMPORARY HELP 199
MEETINGS AND CONFERENCES 181
FUEL EXPENSE 30,327
PROFESSIONAL ASSOCIATION DUES 5
MISCELLANEOUS EXPENSES 150
-------
TOTAL $52,683
=======
</TABLE>
<PAGE>
31
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
RENTS
-----
ACCOUNT 931
-----------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide a listing of the amount included in Account 931, "Rents",
classifying such expenses by major groupings of property, as
defined in the account definition of the Uniform System of
Accounts.
- --------------------------------------------------------------------------------
TYPE OF PROPERTY AMOUNT
- --------------------------------------------------------------------------------
OFFICE SPACE $ 759
------
TOTAL $ 759
======
<PAGE>
32
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
DEPRECIATION AND AMORTIZATION EXPENSE
-------------------------------------
ACCOUNT 403
-----------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ONONDAGA COGENERATION LIMITED PARTNERSHIP $3,681
LAKE COGEN LIMITED 10
NCP ENERGY, INC. 67
OTHER 802
------
TOTAL $4,560
======
</TABLE>
<PAGE>
33
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
TAXES OTHER THAN INCOME TAXES
-----------------------------
ACCOUNT 408
-----------
-------------------------------------------------------------------------------
INSTRUCTION: Provide an analysis of Account 408, "Taxes Other Than Income
Taxes". Separate the analysis into two groups: (1) other than U.S.
Government taxes, and (2) U.S. Government taxes. Specify each of
the various kinds of taxes and show the amounts thereof. Provide a
subtotal for each class of tax.
- --------------------------------------------------------------------------------
KIND OF TAX AMOUNT
- --------------------------------------------------------------------------------
(1) U.S. GOVERNMENT TAXES
---------------------
$ 0
-------
Sub Total 0
-------
(2) OTHER THAN U.S. GOVERNMENT TAXES
--------------------------------
NEW YORK GROSS RECEIPTS TAXES 490
SALES/USE TAX 2
-------
Sub Total 492
-------
TOTAL $ 492
======
<PAGE>
34
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
DONATIONS
---------
ACCOUNT 426.1
-------------
- --------------------------------------------------------------------------------
INSTRUCTION: Provide a listing of the amount included in Account 426.1,
"Donations", classifying such expenses by its purpose. The
aggregate number and amount of all items of less than $3,000 may
be shown in lieu of details.
- --------------------------------------------------------------------------------
NAME OF RECIPIENT PURPOSE OF DONATION AMOUNT*
- --------------------------------------------------------------------------------
Irish American Democrats Opportunity for Business $ 3,000
Development to meet with
Bordina Mona and other Irish
Governmental Officials
The Washington Opera To join the Chairman's 3,000
Circle and to acknowledge
GPU International in the
StageBill and Opera Ball
Program
6 Others (Under $3,000) 1,589
-------
TOTAL $ 7,589
=======
* In Whole Dollars
<PAGE>
35
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
OTHER DEDUCTIONS
----------------
ACCOUNT 426.5
-------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: Provide a listing of the amount included in Account 426.5, "Other
Deductions", classifying such expenses according to their nature.
- --------------------------------------------------------------------------------
DESCRIPTION NAME OF PAYEE AMOUNT
----------- ------------- ------
- --------------------------------------------------------------------------------
FOREIGN CURRENCY EXCHANGE LOSS $ 22
PARTNERSHIP FINANCE 2,487
SETTLEMENT OF DEFERRED FUEL COSTS (3,000)
AMORTIZATION OF DEFERRED GAIN (4,722)
---------
Total $ (5,213)
=========
<PAGE>
36
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
-----------------
- --------------------------------------------------------------------------------
SCHEDULE XVIII
--------------
NOTES TO STATEMENT OF INCOME
----------------------------
- --------------------------------------------------------------------------------
INSTRUCTIONS: The space below is provided for important notes regarding the
statement of income or any account thereof. Furnish particulars
as to any significant increase in services rendered or expenses
incurred during the year. Notes relating to financial statements
shown elsewhere in this report may be indicated here by
reference.
- --------------------------------------------------------------------------------
The Notes to Financial Statements of GPU International, Inc. will be filed
separately under a request for confidential treatment under Rule 104(b).
<PAGE>
37
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
For the Year Ended December 31, 1998
------------------
- --------------------------------------------------------------------------------
ORGANIZATION CHART
------------------
- --------------------------------------------------------------------------------
BOARD OF DIRECTORS
Chairman
President & CEO
Senior Vice President & COO
Division Counsel
Projects & Technical Services
Vice President & Comptroller
Domestic Business Unit
International Business Unit
Managing Director Business Development
Director Technology Ventures
Vice President - Philippines
<PAGE>
38
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
- --------------------------------------------------------------------------------
METHODS OF ALLOCATION
---------------------
- --------------------------------------------------------------------------------
Not Applicable
<PAGE>
39
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
--------------------------
- --------------------------------------------------------------------------------
ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
----------------------------------------------------------
- --------------------------------------------------------------------------------
NONE
<PAGE>
40
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
- --------------------------------------------------------------------------------
VENTURE DISCLOSURES
-------------------
- --------------------------------------------------------------------------------
In accordance with discussions with the staff, financial statements for projects
in which EII owns interests will be included in a Certificate Pursuant to Rule
24 to be filed under the 1935 Act for the quarter ended March 31, 1996, pursuant
to the order dated November 16, 1995 (HCAR No. 26123; File No. 70-7727).
<PAGE>
41
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
--------------------------
- --------------------------------------------------------------------------------
EXHIBIT
-------
- --------------------------------------------------------------------------------
The following information is provided in accordance with an Amendment No. 3 to
the GPU International (GPUI) Application on Form U-1 dated December 13, 1998
(SEC File No. 70-8913) filed under the Public Utility Holding Company Act of
1935.
(a) Each investment made by GPUI in a Subsidiary or the Enterprise, as defined
- ------------------------------------------------------------------------------
in the Amendment, during 1996.
- ------------------------------
In December 1996, GPUI and Ballard Power Systems (BPS) formed a joint venture,
Ballard Generation Systems, Inc. (BGS), which will develop, manufacture and
market stationary fuel cell power plants worldwide and will be based in British
Columbia, Canada. BPS will supply the fuel cells for these power plants. GPUI
has committed to invest $23.25 million in BGS by June 30, 1999 for (1) up to a
19.3% equity interest in BGS; (2) two 250 KW fuel cell power plants for field
trials; (3) non-transferable warrants to purchase 100,000 common shares in BPS
at a price of Canadian $27.45 per share; and (4) an option to acquire 425,000
shares of BGS preferred stock.
In 1997, GPUI made a prepayment of $4,250,000 for the purchase of two field fuel
cell power plants. This prepayment is included in Other noncurrent assets in
the Consolidated Balance Sheets as of December 31, 1998 and 1997. GPUI expects
to take delivery of these field fuel cell power plants by year-end 1999.
GPUI has accounted for its purchase of warrants on BPS stock as an investment
having a book value of $97,000. The warrants have a term of five years and are
subject to GPUI making the entire $23.25 million investment by June 30, 1999.
GPUI anticipates funding its remaining commitment of $4 million during 1999.
The option to acquire 425,000 shares of BGS stock was assigned a book value of
$4,250,000. The aggregate purchase price for all the shares to be acquired
under the option is $1. The options may be exercised by GPUI at any time after
GPUI has made payment for the two field fuel cell power plants and before the
earlier of December 2001 or the initial public offering of BGS. The initial
public offering of BGS had not yet occurred as of December 31, 1998.
(b) A general description of the activities of the Enterprise in 1998.
-----------------------------------------------------------------
GPUI has accounted for its investment using the equity method through June 30,
1998 and changed to cost method on July 1, 1998 resulting from the admission of
a new partner into the joint venture that caused GPUI to no longer have
significant influence over BGS. In 1998, GPUI made an additional investment in
BGS of $4 million, of which approximately $3.4 million represents goodwill.
GPUI's investment in BGS amounted to $14.2 million and $10.8 million as of
December 31, 1998 and 1997, respectively, representing 10.65% and 10.07%
ownership interest, respectively.
GPUI accounted for BGS using the purchase method. Accordingly, approximately
$9.9 million of the total investment represents goodwill, which is being
amortized over a period of 20-years. The goodwill and related amortization is
recorded in Investments, net in the Consolidated Balance Sheets. Amortization
expense amounted to $334,011 and $157,890 for the years ended December 31, 1998
and 1997, respectively, and is included in Equity in earnings (losses) of
investments in the Statement of Income.
(c) The number of GPUI employees providing services to the Enterprise on a
----------------------------------------------------------------------
regular basis during the previous year.
- ---------------------------------------
ONE
(d) The revenues and expenses of the Enterprise during 1998.
--------------------------------------------------------
There were $85 thousand in revenues and $.5 million in expenses.
<PAGE>
ANNUAL REPORT OF GPU INTERNATIONAL, INC.
-----------------------
SIGNATURE CLAUSE
Pursuant to the requirements of the Public
Utility Holding Company Act of 1935 and the rules
and regulations of the Securities and Exchange
Commission issued thereunder, the undersigned
company has duly caused this report to be signed
on its behalf by the undersigned officer thereunto
duly authorized.
GPU INTERNATIONAL, INC.
-----------------------------------
(Name of Reporting Company)
By: /s/ R. L. Wise
--------------------------------
(Signature of Signing Officer)
R. L. Wise, President and CEO
-----------------------------------
(Printed Name and Title of Signing Officer)
Date: 4/30/99
-----------------
<PAGE>
ITEM 6. OFFICERS AND DIRECTORS Exhibit F-1
Part III.
The following pages consist of disclosures made in GPU, Inc.'s 1999 Proxy
Statement as well as disclosures made in GPU, Inc.'s 1998 Annual Report on Form
10-K.
GPU, Inc.
---------
REMUNERATION OF DIRECTORS
Non-employee directors receive an annual retainer of $20,000, a fee of
$1,000 for each Board meeting attended and a fee of $1,000 for each Committee
meeting attended. Committee Chairmen receive an additional retainer of $3,000
per year.
Admiral Trost also received approximately $67,000 in 1998 for serving as a
member of the Board of Directors of GPUN, a direct subsidiary of GPU, and
chairman of that Board's Nuclear Safety and Compliance Committee.
DEFERRED STOCK UNIT PLAN FOR OUTSIDE DIRECTORS
Under the Deferred Stock Unit Plan for Outside Directors of GPU, Inc.
("Deferred Stock Unit Plan"), each director who is not an employee of the
Corporation or any of its subsidiaries (an "Outside Director") receives an
annual grant of units representing shares of GPU Common Stock equal in value at
the time of grant to one and one-half times the value of the director's annual
cash retainer in effect at the time of grant. Each unit granted under the
Deferred Stock Unit Plan represents one share of GPU Common Stock. Dividend
equivalents paid on outstanding units are invested in additional units.
Outside Directors who have served at least 54 months will receive payment
of their deferred units upon their retirement from the Board. Payment of units
will be in the form of GPU Common Stock, or in cash if authorized by the
Personnel, Compensation and Nominating Committee. As of December 31, 1998, all
outside directors except Mr. Townsend had completed 54 months of service.
RETIREMENT PLAN FOR OUTSIDE DIRECTORS
Under the Retirement Plan for Outside Directors of GPU, Inc. ("Retirement
Plan"), as amended, an individual who completed 54 months of service as of June
30, 1997 as a non-employee director is entitled to receive retirement benefits
equal to the product of (A) the number of months of service completed and (B)
the monthly compensation paid to the director at the date of retirement.
Benefits under the Retirement Plan are payable to the directors, at their
election (or, in the event of death, to designated beneficiaries) in a lump sum
payment or in monthly installments of 1/12 of the sum of (x) the then annual
retainer paid at time of retirement plus (y) the cash value of the award under
the Restricted Stock Plan for Outside Directors for the year preceding
retirement, over a period equal to the director's service as such as of June 30,
1997, unless otherwise directed by
1
<PAGE>
the Personnel, Compensation and Nominating Committee, commencing at the later of
age 60 or upon retirement. Service following June 30, 1997 will be applied
toward the 54-month vesting requirement but will not increase the amount of
benefits. No individual who first becomes an Outside Director on or after July
1, 1997 will be entitled to receive any benefits under the Retirement Plan.
As of December 31, 1998, all Outside Directors except Mr. Townsend were
vested in the Retirement Plan. The following directors are entitled to receive
retirement benefits equal to the number of months of service completed at June
30, 1997:
MONTHS OF SERVICE
DIRECTOR AS OF JUNE 30, 1997
-------- -------------------
Theodore H. Black 112
Thomas B. Hagen 93
Henry F. Henderson, Jr. 101
John M. Pietruski 101
Catherine A. Rein 101
Paul R. Roedel 222
Carlisle A. H. Trost 78
Patricia K. Woolf 167
RESTRICTED STOCK PLAN FOR OUTSIDE DIRECTORS
Under the GPU, Inc. Restricted Stock Plan for Outside Directors ("Directors
Plan"), each Outside Director is paid a portion of his or her annual
compensation in the form of 300 shares of GPU Common Stock.
A total of 40,000 shares of GPU Common Stock (subject to adjustment for
stock dividends, stock splits, recapitalizations and other specified events) has
been authorized for issuance under the Directors Plan. Any shares awarded which
are forfeited as provided by the Directors Plan will again be available for
issuance.
Shares of GPU Common Stock are awarded to Outside Directors on the
condition that the director serves or has served as an Outside Director until
(i) death or disability, (ii) retirement not earlier than the first day of the
month following the director's 72nd birthday, (iii) resignation or retirement
before the first day of the month following the director's 72nd birthday with
the consent of the Board, which is defined in the Directors Plan to mean
approval thereof by at least 80% of the directors other than the affected
director or (iv) failure to be re-elected to the Board after being duly
nominated. Termination of service for any other reason, including any
involuntary termination effected by action or inaction of the Board, other than
that following a change in control (as defined) of GPU, will result in
forfeiture of all shares awarded.
Until termination of service, an Outside Director may not dispose of any
shares of GPU Common Stock awarded under the Directors Plan, but has all other
rights of a shareholder with respect to such shares, including voting rights and
the right to receive all cash dividends paid with respect to awarded shares.
2
<PAGE>
SECURITY OWNERSHIP
SECURITY OWNERSHIP OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
The following table sets forth, as of February 1, 1999, the beneficial
ownership of equity securities (and stock-equivalent units) of the GPU Companies
of each of the GPU directors, nominees for director and each of the executive
officers named in the Summary Compensation Table, and of all directors and
executive officers of GPU as a group. The shares of Common Stock owned by all
directors and executive officers as a group constitute less than 1% of the total
shares outstanding.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
----------------------------------------------------------------------
SHARES (1) STOCK-EQUIVALENT
--------------------------
NAME TITLE OF SECURITY DIRECT INDIRECT UNITS
---- ----------------- ---------- ------------ ------------------
<S> <C> <C> <C> <C>
Dennis Baldassari GPU Common Stock 4,766 14,999 (2)
Theodore H. Black GPU Common Stock 8,730 1,716 (3)
Fred D. Hafer GPU Common Stock 9,795 146 25,677 (2)
Thomas B. Hagen GPU Common Stock 12,037 1,716 (3)
Henry F. Henderson, Jr. GPU Common Stock 4,182 1,200 1,716 (3)
Ira H. Jolles GPU Common Stock 10,230 16,979 (2)
Bruce L. Levy GPU Common Stock 3,035 13,277 (2)
John M. Pietruski GPU Common Stock 4,900 1,716 (3)
Catherine A. Rein GPU Common Stock 3,898 1,716 (3)
Paul R. Roedel GPU Common Stock 3,500 1,716 (3)
Bryan S. Townsend GPU Common Stock 1,275 1,716 (3)
Carlisle A. H. Trost GPU Common Stock 3,444 1,716 (3)
Robert L. Wise GPU Common Stock 4,111 19,165 (2)
Patricia K. Woolf GPU Common Stock 4,479 1,716 (3)
All GPU Directors and
Executive Officers
as a Group GPU Common Stock 85,452 1,990 139,301
- -------------------
</TABLE>
(1) The number of shares owned and the nature of such ownership, not being
within the knowledge of GPU, have been furnished by each individual.
(2) Restricted units, which do not have voting rights, represent rights
(subject to vesting) to receive shares of Common Stock under the 1990 Stock
Plan for Employees of GPU, Inc. and Subsidiaries (the "1990 Stock Plan").
These amounts also include restricted units which have vested under the
1990 Stock Plan, but which were deferred pursuant to that Plan by the
following officers: Mr. Levy - 619 units and Mr. Wise - 4,346 units. See
footnote 2 to the Summary Compensation Table on page 33.
(3) Each Outside Director receives an annual grant of deferred stock units
which represents an equivalent number of shares of GPU Common Stock.
Outside Directors who have served at least 54 months will receive payment
of their deferred units upon retirement. See Deferred Stock Unit Plan for
Outside Directors on page 16.
3
<PAGE>
EXECUTIVE COMPENSATION
PERSONNEL, COMPENSATION AND NOMINATING COMMITTEE REPORT
While the basic structure of GPU's executive compensation program remained
unchanged in 1998, adjustments were made to strengthen the link between
executive pay and shareholder value through increased use of stock-based
compensation. The overall program consists of three interrelated components -
the Base Salary Program, the Incentive Compensation Program and the 1990 Stock
Plan. Each of these components serves a specific purpose within the objectives
of the overall program.
COMPENSATION PHILOSOPHY AND MARKET COMPARISONS
- ----------------------------------------------
GPU's compensation philosophy is to maintain a program that (1) attracts
and retains executives with the skills and experience needed to manage the
Corporation, (2) encourages these executives to achieve specific short-term and
long-term objectives that support the Corporation's business strategy, and (3)
rewards executives when these objectives are achieved and shareholder value is
enhanced. The program is designed to ensure that actual pay levels will reflect
the achievement of specific objectives, changes in shareholder value and the
contribution and performance of individual executives.
When targeted business objectives are achieved, the program provides levels
of compensation that are approximately at the median of the competitive market.
If objectives are exceeded, the variable components of the program, the
Incentive Compensation Program and the 1990 Stock Plan, should provide levels of
compensation that are above median. Conversely, these variable components ensure
compensation levels below the competitive median if business objectives are not
achieved. With the increased emphasis on stock-based compensation, changes in
the value of the Corporation's stock have a major influence on the levels of
total compensation and the competitive position of the overall program.
GPU defines the competitive market for executive pay primarily as companies
of similar size and complexity in the industry since these are the companies
most likely to compete directly with GPU for executive talent. These companies
include most of the companies in the Standard & Poor's Electric Utility Index
(the "S&P Electric Utility Index") shown on page 33. GPU also considers
companies not included in the Index reflecting the need to compete in a broader
market for executives. A major national compensation consulting firm assists the
Committee in developing appropriate comparisons and defining median pay levels.
The Committee meets periodically with these consultants to ensure an objective
analysis.
Under Section 162(m) of the Internal Revenue Code of 1986, the amount
allowable as a tax deduction for compensation paid to the chief executive
officer and each of the other highest paid officers of any publicly held
corporation generally is limited to $1 million per year for each such officer.
Although the Committee considers the effect of Section 162(m) in connection with
the Corporation's executive compensation program, the Committee considers it
important to retain the flexibility to design compensation programs that it
believes are in the best interests of GPU and its stockholders, even though the
expense may not be fully deductible. The
4
<PAGE>
Committee continues to monitor the potential impact of Section 162(m) and
considers modifications to the executive compensation program with this impact
in mind.
BASE SALARY PROGRAM
The Base Salary program, which provides the most stable portion of
executive compensation, continues to be de-emphasized within the overall
executive compensation program. Each year the Committee reviews salaries to
determine if any adjustments are needed. In conducting this review, the
Committee considers market data, individual performance and the Corporation's
financial position. Because the Committee wishes to emphasize the variable
components of the overall program, base salaries were increased in 1998 only if
the executive's existing salary had fallen below competitive median or if the
executive assumed additional responsibilities.
INCENTIVE COMPENSATION PROGRAM
- ------------------------------
The Incentive Compensation Program is designed to compensate executives
based on their achievement of short-term business objectives that are aligned
with the Corporation's overall strategy. Executives have the opportunity to
earn additional cash compensation if these objectives are met.
For 1998, the Incentive Compensation Program emphasized financial
objectives. Objectives were established for both the Corporation and each GPU
company. In addition, the personal performance and contribution of the
individual executives to the achievement of these objectives was a factor in
determining awards under the program. The Committee and the Board use subjective
judgment in determining the impact of individual contribution.
For the Named Executive Officers other than Mr. Hafer, awards under this
program are based on achievement of GPU corporate objectives, and achievement of
objectives established for the GPU company to which the executive is assigned as
well as individual contribution. Awards for Mr. Levy and Mr. Wise for 1998 were
based on results of GPUI and Genco respectively, where those executives were
assigned for the majority of 1998. Objectives for Mr. Hafer are established
separately reflecting his overall responsibility for the Corporation's success.
1998 OBJECTIVES - GPU, INC.
Measures of GPU's performance in 1998 were the Corporation's return on
equity and earnings. Achievement of the return on equity objective served as a
"multiplier" on the achievement of individual company objectives. The earnings
objective was used to establish an "earnings test" designed to limit the amount
of incentive compensation that could be earned based on non-financial measures.
For all GPU Companies other than GPUI, this earnings test is based on GPU, Inc.
earnings; for GPUI, the earnings test is based on a combination of GPU, Inc.
earnings and GPUI earnings reflecting GPUI's proportionate contribution to
corporate earnings.
1998 Objectives - GPU Companies
For GPU Energy, targeted objectives were earnings (80% of total), measures
designed to improve internal processes and employee effectiveness (10%),
measures of customer satisfaction (5%) and efforts to influence restructuring
rulings (5%).
5
<PAGE>
For Genco, objectives were all-in-price per kilowatt hour sold (40% of
total), management of expense budgets (30%), environmental factors (10%), safety
(10%) and efforts to foster diversity (10%).
For GPUS, the corporate functions, objectives were corporate earnings (80%
of total), efforts to maximize existing businesses and respond to regulatory
changes (10%), and efforts to improve the Corporation's competitive position
through changes in internal processes and culture (10%).
For GPUI, objectives were income (65% of total), new business initiatives
(15%), optimization of current projects and environmental compliance (10%), and
efforts to improve the effectiveness of the internal organization (10%).
1998 OBJECTIVES - MR. HAFER
Mr. Hafer's objectives for 1998 were return on equity (65% of total),
efforts to position the Corporation for the future through both internal
restructuring and competitive initiatives (25%), and nuclear safety (10%).
Because return on equity is the major component of Mr. Hafer's objectives, the
corporate multiplier is not used in calculating results; the "earnings test" is
applied.
ACHIEVEMENT OF 1998 OBJECTIVES
GPU's 1998 return on equity objective was slightly exceeded. Corporate
earnings were also slightly above objective and the earnings test calculation
limited the awards in several GPU Companies. The separate earnings test applied
to GPUI did not limit awards in that company.
At GPU Energy, earnings, the major component of the objectives, were above
targeted levels. Improvements in internal processes and employee effectiveness
exceeded expectations. Customer satisfaction measures and efforts to influence
restructuring were also above targeted levels.
Achievement of Genco's financial measures, all-in-price and management of
expense budgets, were significantly above targeted levels. Environmental and
safety objectives were not fully achieved while efforts to foster diversity
exceeded expectations.
For the corporate functions at GPUS, the corporate earnings measure was
above targeted levels. Efforts to maximize existing businesses and respond to
regulatory changes exceeded expectations while measures of improvements in
internal processes and culture were slightly above targeted levels.
At GPUI, the income objective was significantly exceeded. New business
initiatives were not fully achieved while measures of environmental compliance
and maximizing existing businesses were at targeted levels. Efforts to improve
the effectiveness of the internal organization were above expectations.
6
<PAGE>
AWARD FOR MR. HAFER
The award for Mr. Hafer reflects a return on equity that was above the
targeted level as well as over achievement of measures reflecting efforts to
position the Corporation for the future. Nuclear safety measures were also
above targeted levels.
THE 1990 STOCK PLAN
The 1990 Stock Plan is GPU's long-term incentive program. Awards under the
program are designed to provide executives with opportunities to earn additional
compensation directly linked to shareholder value. The awards also serve as a
retention device since they are typically forfeited if an executive resigns.
Under the provisions of the Plan, which was approved by shareholders, the
Committee and the Board have the discretion to use a variety of stock
compensation vehicles.
In 1998, awards under the Plan were in the form of restricted performance
units and non-qualified stock options. Awards of restricted performance units
were granted prior to 1998, when stock options were granted for the first time.
Restricted performance units provide executives with the right to receive
shares of GPU stock (or cash at the discretion of the Committee) provided that
targeted performance measures are achieved. The performance measure for the 1998
grants is GPU's total shareholder return compared to the total return of the
companies in the S&P Electric Utility Index. The percentile ranking of GPU's
total return among Index companies is calculated quarterly over the five-year
performance period and averaged. The averaged ranking determines how many shares
of GPU stock, if any, the executive will receive at the end of the performance
period.
Each executive who receives an award is granted a specific number of units.
Dividend equivalents are paid on these units and reinvested in additional units.
The number of units that will ultimately vest and be paid to the executive is
not known, however, until the end of the performance period. If GPU's total
return is at the 55th percentile of the Index companies, all of the originally
awarded units plus reinvested dividend equivalents will vest. If total return is
higher than the 59th percentile, additional units will vest; if total return is
lower, fewer units will vest. No units will vest if total return is below the
40th percentile.
Stock options granted in 1998 have an exercise price equal to the fair
market value of GPU stock on the date of grant and will become exercisable over
a three-year period. These grants were intended to maintain total compensation
at competitive levels while increasing the focus on shareholder value.
Awards of performance restricted units and stock options to individual
executives are generally targeted to provide median levels of compensation if
performance is as expected. Higher levels of performance would result in
compensation above median levels and lower levels of performance would result in
compensation below median levels. The size of individual awards also reflects
the Committee's and the Board's subjective assessment of each executive's
performance and potential contribution to the Corporation's future success.
7
<PAGE>
AWARDS FOR MR. HAFER
--------------------
The 1998 awards of performance units and stock options to Mr. Hafer reflect
the factors outlined above as well as his unique role in guiding the Corporation
and enhancing shareholder value. The terms and conditions of his awards are the
same as those described for other executives.
STOCK OWNERSHIP GUIDELINES
In conjunction with the initial awards of stock options, the Corporation
implemented stock ownership guidelines for all elected officers of GPU and its
subsidiaries in 1998. These guidelines are expressed as a multiple of base
salary and all officers are expected to meet their targeted ownership within
three to five years. Calculations of ownership will include shares directly
owned, vested and deferred restricted performance units and exercisable stock
options.
Members of the Personnel, Compensation
and Nominating Committee
Theodore H. Black
Thomas B. Hagen
John M. Pietruski
Catherine A. Rein
Patricia K. Woolf
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
The following graph compares the five-year cumulative total return,
including reinvested dividends, on GPU Common Stock, with the Standard & Poor's
500 Stock Index (the "S&P 500 Index") and the S&P Electric Utility Index:
[Tabular representation of Performance Graph is set forth below]
<TABLE>
<CAPTION>
AMOUNT
INVESTED
1/1/94* 1994 1995 1996 1997 1998
------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
GPU $ 100 $ 91 $ 125 $ 131 $ 174 $ 192
S&P 500 100 101 139 171 229 294
S&P Electric Utility 100 87 114 114 144 166
</TABLE>
* Assumes $100 invested in GPU Common Stock, S&P 500 Index and S&P Electric
Utility Index. Cumulative Total Return includes reinvestment of dividends.
REMUNERATION OF EXECUTIVE OFFICERS
The following tables present compensation information from the past three
years for the Chief Executive Officer and the four other most highly compensated
executive officers ("Named Executive Officers").
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
---------------------------------- ----------------------
AWARDS
------
- OTHER SECURITIES
NAME AND - ANNUAL UNDERLYING PAYOUTS ALL OTHER
-------
PRINCIPAL - COMPENSA- OPTIONS LTIP COMPEN-
POSITION YEAR SALARY($) BONUS ($) TION($)(1) GRANTED(#) PAYOUTS($)(2) SATION($).
- --------------------- ---- --------- -------- --------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Fred D. Hafer 1998 $613,077 $375,000 $ 1,805 95,000 $63,007 $116,823(3)
CHAIRMAN, PRESIDENT 1997 526,923 275,000 2,123 -- 66,950 106,291
& CHIEF EXECUTIVE 1996 365,000 190,000 1,883 -- 61,484 46,731
OFFICER GPU
BRUCE L. LEVY 1998 288,875 223,200 997(4) 37,000 21,002 55,748(3)
SR. VICE PRESIDENT 1997 255,833 165,300 1,312(4) -- 20,922 49,123
& CHIEF FINANCIAL 1996 233,333 197,000 1,572(4) -- 20,495 30,684
OFFICER, GPU; PRES.
GPU CAPITAL, INC.
IRA H. JOLLES 1998 353,085 126,000 2,139 21,000 82,973 59,090(3)
SR. VICE PRESIDENT 1997 331,000 100,000 2,455 -- 86,012 55,107
& GENERAL COUNSEL, 1996 331,000 120,000 2,510 -- 91,087 52,673
DENNIS BALDASSARI 1998 335,000 95,000 2,081(5) 17,000 63,007 70,882(3)
PRESIDENT, JCP&L, 1997 335,000 76,000 1,943(5) -- 56,489 71,912
MET-ED & PENELEC 1996 305,000 110,000 812(5) -- 21,724 39,697
ROBERT L. WISE 1998 293,000 115,000 -- 17,000 65,808 69,501(3)
PRESIDENT, GPUI 1997 293,000 95,000 -- -- 69,042 58,053
GPU POWER, INC. 1996 293,000 112,000 57,213(6) -- 81,978 53,448
- ----------------
</TABLE>
(1) Consists of earnings on Long-Term Incentive Plan ("LTIP") compensation paid
in the year the award vests.
(2) Consists of Performance Cash Incentive Awards paid on the 1991, 1992 and
1993 restricted stock awards which have vested under the 1990 Stock Plan.
These amounts are designed to compensate recipients of restricted
stock/unit awards for the amount of federal and state income taxes that are
payable upon vesting of the restricted stock/unit awards.
The restricted units issued in 1995, 1996, 1997 and 1998 under the 1990
Stock Plan are performance based. The 1998 awards are shown in Long-Term
Incentive Plans - Awards in Last Fiscal Year table (the "LTIP table").
Dividend equivalents are earned on the aggregate restricted units awarded
under the 1990 Stock Plan and reinvested in additional units.
The aggregate number and value (based on the stock price per share at
December 31, 1998) of unvested and deferred vested stock-equivalent
restricted units (including reinvested dividend equivalents) include the
amounts shown on the LTIP table, and at the end of 1998 were:
<TABLE>
<CAPTION>
AGGREGATE UNITS AGGREGATE VALUE
--------------- ---------------
<S> <C> <C>
Fred D. Hafer 25,677 $1,134,602
Bruce L. Levy 13,277 586,677
Ira H. Jolles 16,979 750,260
Dennis Baldassari 14,999 662,768
Robert L. Wise 19,165 846,853
</TABLE>
9
<PAGE>
(3) For 1998, (a) the Corporation's matching contributions under the Savings
Plan, (b) the Corporation's matching contributions under the non-qualified
deferred compensation plan, (c) the benefit of interest-free use of the
non-term portion of employer-paid premiums for split-dollar life insurance,
(d) above-market interest accrued on the retirement portion of deferred
compensation and (e) earnings on LTIP compensation not paid in the current
year, were as follows:
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Fred D. Hafer $6,400 $29,062 $36,834 $ 1,139 $43,388
Bruce L. Levy 6,400 11,612 13,291 870 23,575
Ira H. Jolles 6,400 11,688 9,379 964 30,659
Dennis Baldassari 6,400 10,940 26,208 325 27,009
Robert L. Wise 6,400 9,120 8,312 10,050 35,619
</TABLE>
NOTE: The split-dollar life insurance amounts reported in the "All Other
Compensation" column are equal to the present value of the interest-free
use of the current year Corporation-paid premiums to the projected date the
premiums will be refunded to the Corporation.
(4) In addition to the earnings on LTIP compensation noted in (1) above, these
amounts include the above-market interest accrued on the pre-retirement
portion of deferred compensation in the amounts of $997, $648 and $944 for
the years 1998, 1997 and 1996 respectively.
(5) In addition to the earnings on LTIP compensation noted in (1) above, these
amounts include the above-market interest accrued on the pre-retirement
portion of deferred compensation in the amounts of $276, $151 and $147 for
the years 1998, 1997 and 1996 respectively.
(6) In addition to the 1996 earnings on LTIP compensation ($2,510) noted in (1)
above, this amount includes $25,953 for a one-time automobile adjustment
and $23,447 for related income taxes.
OPTION GRANTS IN LAST FISCAL YEAR
The following table summarizes option grants made during 1998 to the
Named Executive Officers. All of these options were granted with an exercise
price equal to the fair market value of GPU stock on the date of grant.
10
<PAGE>
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES % OF TOTAL GRANT
UNDERLYING OPTIONS DATE
OPTIONS GRANTED TO EXERCISE OR PRESENT
GRANT GRANTED(1) EMPLOYEES IN BASE PRICE VALUE(2)
NAME DATE (#) FISCAL YEAR ($/SH) EXPIRATION DATE ($)
- --------------------- -------- ------------- ----------------- ----------- --------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Fred D. Hafer 06/04/98 95,000 28.3% $36.625 06/04/08 $412,300
Bruce L. Levy 06/04/98 17,000 5.1 36.625 06/04/08 73,780
Bruce L. Levy 12/16/98 20,000 6.0 44.250 12/16/08 103,200
Ira H. Jolles 06/04/98 21,000 6.3 36.625 06/04/08 91,140
Dennis Baldassari 06/04/98 17,000 5.1 36.625 06/04/08 73,780
Robert L. Wise 06/04/98 17,000 5.1 36.625 06/04/08 73,780
</TABLE>
(1) Options become exercisable in three equal annual installments beginning on
the first anniversary of the date of the grant. These grants will fully
vest upon termination of employment resulting from death or disability.
Options may be exercised after retirement in accordance with the terms of
the 1998 Stock Option Agreement. In the event of a change in control during
the option term, all options will be canceled and the executive officer
will receive a cash payment in an amount equal to the excess of the average
current market price over the exercise price.
(2) Options are valued using a Black-Scholes option pricing model, a
mathematical formula widely used to value options. The model as applied
used the applicable grant dates and the exercise prices shown on the table,
and the fair market value of Common Stock on the respective grant dates,
which was in each case the same as the exercise price. For the June 4
grant, the model assumed (i) a risk-free rate of return of 5.78%, which
approximates the rate on 10-year U.S. Treasury zero coupon bonds on the
grant date; (ii) a stock price volatility of 17.26%, based on the average
historical volatility for the 36-month period ending on the grant date;
(iii) an average dividend yield of 5.68%, based on the average yield for a
36-month period; and (iv) the exercise of all options on the final day of
their 10-year terms. For the December 16 grant, the model assumed (i) a
risk-free rate of return of 4.89%, which approximates the rate on 10-year
U.S. Treasury zero coupon bonds on the grant date; (ii) a stock price
volatility of 18.32%, based on the average historical volatility for the
36-month period ending on the grant date; (iii) an average dividend yield
of 5.51%, based on the average yield for a 36-month period; and (iv) the
exercise of all options on the final day of their 10-year terms. No
discount from the theoretical value was taken to reflect the restrictions
on the transfer of the options and the likelihood of the options being
exercised in advance of the final day of their terms.
11
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUE
The following table summarizes the number and value of all unexercised
options held by the Named Executive Officers. In 1998, no options were
exercised by any Named Executive Officer.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS
FISCAL YEAR-END (#) AT FISCAL YEAR-END ($)
-------------------------------- --------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Fred D. Hafer -- 95,000 $-- $718,438
Bruce L. Levy -- 37,000 -- 128,563
Ira H. Jolles -- 21,000 -- 158,813
Dennis Baldassari -- 17,000 -- 128,563
Robert L. Wise -- 17,000 -- 128,563
</TABLE>
LONG-TERM INCENTIVE PLANS - AWARDS IN LAST FISCAL YEAR
This table shows the LTIP awards made to the Named Executive Officers for
the performance period January 1, 1998 through December 31, 2002.
<TABLE>
<CAPTION>
Performance
Number of or Other Estimated Future Payouts Under
Shares, Period Until Non-Stock Price Based Plans(1)
--------------------------------
Units or Maturation Threshold Target Maximum
Name Other Rights or Payout (#) (#) (#)
- --------------------- ------------ -------------- ------------ -------- ---------
<S> <C> <C> <C> <C> <C>
Fred D. Hafer 7,810 5-year vesting 3,905 7,810 15,620
Bruce L. Levy 2,900 5-year vesting 1,450 2,900 5,800
Ira H. Jolles 3,200 5-year vesting 1,600 3,200 6,400
Dennis Baldassari 2,900 5-year vesting 1,450 2,900 5,800
Robert L. Wise 2,600 5-year vesting 1,300 2,600 5,200
</TABLE>
_______________
(1) The restricted units awarded in 1998 under the 1990 Stock Plan provide for
a performance adjustment to the aggregate number of units vesting for the
recipient, including the accumulated reinvested dividend equivalents, based
on the annualized GPU Total Shareholder Return (TSR) percentile ranking
against all companies in the Standard & Poor's Electric Utility Index for
the period between the award and vesting dates. With a 55th percentile
ranking, the performance adjustment would be 100% as reflected in the
"Target" column. In the event that the percentile ranking is below the 55th
percentile, the performance adjustment would be reduced in steps reaching
0% below the 40th percentile. The minimum payout or "Threshold" begins at
the 40th percentile, which results in a payout of 50% of target. A ranking
below the 40th percentile would result in no award. Should the TSR
percentile ranking exceed the 59th percentile, then the performance
adjustment would be increased in steps reaching 200% at the 90th percentile
as reflected in the "Maximum" column. Under the 1990 Stock Plan, regular
quarterly dividends are reinvested in additional units that are subject to
the vesting restrictions of the award. Actual payouts under the Plan would
be based on the aggregate number of units awarded and the units accumulated
through dividend reinvestment at the time the restrictions lapse.
12
<PAGE>
RETIREMENT PLANS
The GPU Companies' pension plans provide for pension benefits, payable for
life after retirement, based upon years of creditable service with the GPU
Companies and the employee's career average compensation as defined below.
Federal law limits the amount of an employee's pension benefits that may be paid
from a qualified trust established pursuant to a qualified pension plan (such as
the GPU Companies' plans). The GPU Companies also have adopted non-qualified
plans providing that the portion of a participant's pension benefits which, by
reason of such limitations, cannot be paid from such a qualified trust shall be
paid directly on an unfunded basis by the participant's employer.
The following table illustrates the amount of aggregate annual pension from
funded and unfunded sources resulting from employer contributions to the
qualified trust and direct payments payable upon retirement in 1999 (computed on
a single life annuity basis) to persons in specified compensation and years of
service classifications:
ESTIMATED ANNUAL RETIREMENT BENEFITS (2) (3) (4) (5) (6)
BASED UPON CAREER AVERAGE COMPENSATION
---------------------------------------
(1999 RETIREMENT)
<TABLE>
<CAPTION>
Career Average Years of Service
----------------------------------------------------------
Compensation (1) 15 20 25 30 35 40
- ------------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$ 50,000 $ 13,879 $ 18,506 $ 23,132 $ 27,759 $ 32,385 $ 36,761
100,000 28,879 38,506 48,132 57,759 67,385 76,361
150,000 43,879 58,506 73,132 87,759 102,385 115,961
200,000 58,879 78,506 98,132 117,759 137,385 155,561
250,000 73,879 98,506 123,132 147,759 172,385 195,161
300,000 88,879 118,506 148,132 177,759 207,385 234,761
350,000 103,879 138,506 173,132 207,759 242,385 274,361
400,000 118,879 158,506 198,132 237,759 277,385 313,961
450,000 133,879 178,506 223,132 267,759 312,385 353,561
500,000 148,879 198,506 248,132 297,759 347,385 393,161
550,000 163,879 218,506 273,132 327,759 382,385 432,761
600,000 178,879 238,506 298,132 357,759 417,385 472,361
650,000 193,879 258,506 323,132 387,759 452,385 511,961
700,000 208,879 278,506 348,132 417,759 487,385 551,561
750,000 223,879 298,506 373,132 447,759 522,385 591,161
800,000 238,879 318,506 398,132 477,759 557,385 630,761
</TABLE>
________________
(1) Career Average Compensation is the average annual compensation received
from January 1, 1984 to retirement and includes Salary and Bonus. The
Career Average Compensation amounts for the following Named Executive
Officers differ by more than 10% from the three-year average annual
compensation set forth in the Summary Compensation Table and are as
follows: Messrs. Hafer - $355,761; Levy - $201,945; Baldassari - $223,671
and Wise - $282,807.
13
<PAGE>
(2) Years of Creditable Service at December 31, 1998: Messrs. Hafer - 36
years; Levy - 18 years; Jolles - 18 years; Baldassari - 29 years and Wise -
35 years.
(3) Based on an assumed retirement at age 65 in 1999. To reduce the above
amounts to reflect a retirement benefit assuming a continual annuity to a
surviving spouse equal to 50% of the annuity payable at retirement,
multiply the above benefits by 90%. The estimated annual benefits are not
subject to any reduction for Social Security benefits or other offset
amounts.
(4) Annual retirement benefits under the basic pension per the above table
cannot exceed 55%, as defined in the pension plan, of the average
compensation during the highest paid 36 calendar months. As of December
31, 1998 none of the Named Executive Officers exceed the 55% limit.
(5) Mr. Wise has agreed to accept the Voluntary Enhanced Retirement Program
("VERP") offered by Genco. Pursuant to the VERP, Mr. Wise's pension will
be calculated by adding five years to his age and five years to his years
of creditable service. Mr. Wise will also receive a Social Security
supplement of $500 per month until he reaches age 62.
(6) The estimated annual retirement benefits in this table do not reflect the
retirement benefits which may be provided under the Supplemental Executive
Retirement Plan, described below.
EMPLOYMENT, TERMINATION AND CHANGE IN CONTROL ARRANGEMENTS
SEVERANCE ARRANGEMENTS
The Corporation has entered into Severance Protection Agreements with
Messrs. Hafer, Levy, Jolles, Baldassari and Wise which provide certain severance
benefits to the executive if his employment is terminated following a change in
control of GPU (as defined). These agreements are intended to induce the
executives to remain in the employ of the Corporation and help ensure that the
Corporation will have the benefit of their services without distraction in the
face of a potential change in control.
Under the agreements, benefits are paid if, in connection with a change in
control, the Corporation terminates the employment of the executive for reasons
other than cause or disability or death, or if the executive resigns following
certain actions (specified in the agreements) by the Corporation such as a
reduction in salary or change in position. In addition, Mr. Hafer receives
severance benefits if he resigns for any reason within six months following a
change in control.
The benefits payable to all executives consist of, in general, (a) the
executive's base salary through the termination date and a pro rata portion of
his target incentive bonus (or, if greater, the highest annual bonus paid to him
in any of the three full fiscal years prior to either termination or the change
in control); (b) severance compensation equal to three times the sum of the
executive's base salary and target incentive bonus, provided that if the
executive's normal retirement date is within three years of his termination
date, his benefits will be proportionately reduced; (c) a continuation of
insurance benefits for up to three years; (d) reimbursement
14
<PAGE>
of certain expenses subject to specified limitations; and (e) such additional
amount as is necessary to pay any excise tax under Section 4999 of the Internal
Revenue Code (and any related interest and penalties) on amounts payable under
the agreements.
The agreements have an initial term of two years and automatically renew
annually unless earlier terminated by the executive or GPU.
Under the Corporation's severance policy for employees, if the employment
of Messrs. Hafer, Levy, Jolles, Baldassari or Wise is involuntarily terminated,
as defined, other than in connection with a change in control, he is entitled to
receive, in general, severance compensation equal to one week's pay for each
full year of service. Premium payments will also be made under the executive's
split-dollar life insurance policy for specified periods following the
executive's termination of employment and following a change in control of GPU.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Corporation has established a supplemental executive retirement plan
("SERP") for GPU's senior executives, including the Named Executive Officers,
who retire on or after July 1, 1999. Subject to vesting, the SERP provides a
total retirement benefit equal to 60% of final average pay for executives who
have 30 years of service, with a benefit of 2% per year of service paid to
executives who have served for shorter periods. The benefits are offset by other
sources of retirement income, including social security benefits, qualified and
non-qualified pension benefits and any prior employer benefits.
To vest in the SERP, executives must have reached age 55 and have 15 years
of service; to receive full benefits, they must retire after age 62. An
executive would also be eligible for full benefits if he or she is at least 60
years of age and has had 25 years of service.
LUMP SUM DISTRIBUTIONS
An executive may, prior to retirement and in connection with a change in
control, elect to receive a lump sum distribution of all amounts payable to him
under GPU Companies' supplemental retirement and deferred compensation plans and
arrangements when such executive terminates his employment, regardless of the
circumstances or when the executive terminates his employment within 24 months
following a change in control. Additionally, prior to termination, an executive
may elect to receive such lump sum payment only in the event of a change in
control.
MR. JOLLES
Retirement and Disability - If Mr. Jolles retires on or after his normal
retirement date (the last day of the month in which he attains age 65), he will
receive (in addition to his benefits under GPUS' employee retirement plans) a
supplemental retirement pension from the GPU Companies equal to the additional
pension he would have received under the GPUS employee retirement plans as if he
had an additional 20 years of past creditable service. If Mr. Jolles reaches his
normal retirement date while he is receiving disability income under GPUS'
disability income plans, he will thereafter receive a supplemental retirement
pension from the GPU
15
<PAGE>
Companies equal to the additional pension he would have been paid under GPUS'
employee retirement plans as if he had an additional 20 years of past creditable
service. Upon retirement, Mr. Jolles will also receive an extension of his
health insurance benefits to the third anniversary of retirement.
Termination - (i) If Mr. Jolles' employment with the GPU Companies
terminates "involuntarily," as defined, under circumstances involving a "change
in control" of GPU, as defined, or without cause, he shall receive from the GPU
Companies a supplemental retirement pension which would have been paid to him
under GPUS' employee retirement plans as if he had an additional 20 years of
past creditable service. (ii) If, however, his employment terminates for any
other reason (except upon retirement or death), he will receive from the GPU
Companies a supplemental retirement pension equal to the additional pension he
would have been paid under GPUS' employee retirement plans as if he had
additional years of creditable service ranging, as of December 31, 1998, from
nine and one-half years up to a maximum of 20 years depending upon his years of
actual employment by GPUS at the time of termination.
Death - In the event of Mr. Jolles' death before he begins receiving
benefits under GPUS' employee retirement plans, his surviving spouse, if any,
shall receive such benefits during her lifetime, together with the supplemental
retirement pension benefits which would have been payable to him as described in
Termination (ii) above.
Other - To the extent relevant to the level of benefits payable to Mr.
Jolles under other benefit plans provided for senior GPU executives, he will be
treated as having the years of creditable service as described in Termination
(ii) above.
BENEFIT PROTECTION TRUSTS
The Corporation has entered into benefit protection trust agreements to be
used to fund the Corporation's obligations to executive officers and directors
under deferred compensation and incentive programs and agreements, and with
respect to certain retirement and termination benefits, in the event of a change
in control. The trusts may also be used for the purpose of paying legal
expenses incurred in pursuing benefit claims under such programs and agreements
following a change in control. The trusts are currently partially funded.
16
<PAGE>
Jersey Central Power & Light Company/
Metropolitan Edison Company/Pennsylvania Electric Company
---------------------------------------------------------
EXECUTIVE COMPENSATION.
The information required by this Item with respect to GPU, Inc. is
incorporated by reference to the EXECUTIVE COMPENSATION section of GPU, Inc.'s
Proxy Statement for the 1999 Annual Meeting of Stockholders. The following
table sets forth remuneration paid, as required by this Item, to the Chief
Executive Officer and the five other most highly compensated executive officers
of JCP&L, Met-Ed and Penelec for the year ended December 31, 1998.
The managements of JCP&L, Met-Ed and Penelec were combined in a 1996
reorganization. Accordingly, the amounts shown below represent the aggregate
remuneration paid to such executive officers by JCP&L, Met-Ed and Penelec during
1996, 1997 and 1998.
REMUNERATION OF EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
--------------------------
Long-Term Compensation
----------------------
Annual Compensation Awards
----------------------------------- ------
Other Securities Payouts
-------
Name and Annual Underlying LTIP All Other
Principal Compens- Options Payouts Compens-
Position Year Salary($) Bonus($) ation($)(1) Granted(#) ($)(2) ation ($)
- -------- ---- --------- -------- ----------- ---------- ------ ---------
<S> <C> <C> <C> <C> <C> <C> <C>
F. D. Hafer
Chairman of the
Board and Chief
Executive Officer (3) (3) (3) (3) (3) (3) (3)
D. Baldassari
President (4) (4) (4) (4) (4) (4) (4)
R. S. Zechman 1998 170,000 60,000 538 4,850 18,669 17,623 (5)
Vice President - 1997 162,538 32,000 637 - 20,085 15,843
Engineering & Operations 1996 152,596 44,000 596 - 19,470 14,051
D. J. Howe 1998 170,000 55,000 - 4,850 - 14,033 (6)
Vice President - 1997 162,308 32,000 - - - 11,524
Customer Services 1996 134,539 42,240 - - - 6,582
C. A. Mascari 1998 170,000 50,000 - 4,850 21,002 20,762 (7)
Vice President - 1997 156,228 32,000 - - 18,727 16,997
Power Services 1996 133,800 44,000 - - - 12,649
C. Brooks 1998 170,000 50,000 592 4,850 20,536 15,593 (8)
Vice President - 1997 148,277 32,000 664 - 20,922 13,783
Human & Technical 1996 135,700 42,500 565 - 18,445 12,173
Resources
</TABLE>
(1) Consists of earnings on "Long-Term Incentive Plan" ("LTIP") compensation
paid in the year the award vests.
17
<PAGE>
(2) Consists of Performance Cash Incentive Awards paid on the 1991, 1992 and
1993 restricted stock awards which have vested under the 1990 Stock Plan.
These amounts are designed to compensate recipients of restricted
stock/unit awards for the amount of federal and state income taxes that are
payable upon vesting of the restricted stock/unit awards. The restricted
units issued in 1995, 1996, 1997 and 1998 under the 1990 Stock Plan are
performance based. The 1998 awards are shown in "Long-Term Incentive Plans-
Awards in Last Fiscal Year" table (the "LTIP table"). Dividend equivalents
are earned on the aggregate restricted units awarded under the 1990 Stock
Plan and reinvested in additional units.
The aggregate number and value (based on the stock price per share at
December 31, 1998) of unvested and deferred vested stock-equivalent
restricted units (including reinvested dividend equivalents) includes the
amounts shown on the LTIP table, and at the end of 1998 were:
<TABLE>
<CAPTION>
Aggregate Units Aggregate Value
--------------- ---------------
<S> <C> <C>
F. D. Hafer see note (3) see note (3)
D. Baldassari see note (4) see note (4)
R. S. Zechman 5,281 $233,363
D. J. Howe 3,475 153,552
C. A. Mascari 6,419 283,636
C. Brooks 4,979 219,991
</TABLE>
(3) Mr. Hafer was compensated by GPUS for his overall service on behalf of GPU
and accordingly was not compensated directly by the other subsidiary
companies for his services. Information with respect to Mr. Hafer's
compensation is included in the EXECUTIVE COMPENSATION section of GPU,
Inc.'s Proxy Statement for the 1999 Annual Meeting of Stockholders, which
is incorporated herein by reference.
(4) Information with respect to Mr. Baldassari's compensation is included in
the EXECUTIVE COMPENSATION section of GPU, Inc.'s Proxy Statement for the
1999 Annual Meeting of Stockholders, which is incorporated herein by
reference.
(5) Consists of GPU's matching contributions under the Savings Plan ($6,400),
matching contributions under the non-qualified deferred compensation plan
($1,680), above-market interest accrued on the retirement portion of
deferred compensation ($72), and earnings on LTIP compensation not paid in
the current year ($9,471).
(6) Consists of GPU's matching contributions under the Savings Plan ($6,400),
matching contributions under the non-qualified deferred compensation plan
($1,680), above-market interest accrued on the retirement portion of
deferred compensation ($84), and earnings on LTIP compensation not paid in
the current year ($5,869).
(7) Consists of GPU's matching contributions under the Savings Plan ($6,400),
matching contributions under the non-qualified deferred compensation plan
($1,680), above-market interest accrued on the retirement portion of
deferred compensation ($1,060), and earnings on LTIP compensation not paid
in the current year ($11,622).
18
<PAGE>
(8) Consists of GPU's matching contributions under the Savings Plan ($6,400),
above-market interest accrued on the retirement portion of deferred
compensation ($325), and earnings on LTIP compensation not paid in the
current year ($8,868).
Option Grants In Last Fiscal Year
- ---------------------------------
The following table summarizes option grants made during 1998 to the Named
Executive Officers. All of these options were granted with an exercise price
equal to the fair market value of GPU stock on the date of grant.
<TABLE>
<CAPTION>
Individual Grants
Number of
Securities % of Total
Underlying Options Grant Date
Options Granted to Exercise or Present
Grant Granted(1) Employees in Base Price Expiration Value(2)
Name Date (#) Fiscal Year ($/Sh) Date ($)
- ---------------- --------- ------------- ------------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
F. D. Hafer (3) (3) (3) (3) (3) (3)
D. Baldassari (4) (4) (4) (4) (4) (4)
R. S. Zechman 06/04/98 4,850 1.4% $36.625 06/04/08 $21,049
D. J. Howe 06/04/98 4,850 1.4% 36.625 06/04/08 21,049
C. A. Mascari 06/04/98 4,850 1.4% 36.625 06/04/08 21,049
C. Brooks 06/04/98 4,850 1.4% 36.625 06/04/08 21,049
</TABLE>
Aggregated Option Exercises In Last Fiscal Year And Fiscal Year-End Option Value
- --------------------------------------------------------------------------------
The following table summarizes the number and value of all unexercised
options held by the Named Executive Officers. In 1998, no options were
exercised by any Named Executive Officer.
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
Fiscal Year-End (#) at Fiscal Year-End ($)
------------------------------ ----------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C>
F. D. Hafer (3) (3) (3) (3)
D. Baldassari (4) (4) (4) (4)
R. S. Zechman - 4,850 - 36,678
D. J. Howe - 4,850 - 36,678
C. A. Mascari - 4,850 - 36,678
C. Brooks - 4,850 - 36,678
</TABLE>
(1) Options become exercisable in three equal annual installments beginning on
the first anniversary of the date of the grant. These grants will fully
vest upon termination of employment resulting from death or disability.
Options may be exercised after retirement in accordance with the terms of
the 1998 Stock Option Agreement. In the event of a change in control during
the option term, all options will be canceled and the executive officer
will receive a cash payment in an amount equal to the excess of the average
current market price over the exercise price.
19
<PAGE>
(2) Options are valued using a Black-Scholes option pricing model, a
mathematical formula widely used to value options. The model as applied
used the applicable grant dates and the exercise prices shown on the table,
and the fair market value of Common Stock on the respective grant dates,
which was in each case the same as the exercise price. For the June 4
grant, the model assumed (i) a risk-free rate of return of 5.78%, which
approximates the rate on 10-year U.S. Treasury zero coupon bonds on the
grant date; (ii) a stock price volatility of 17.26%, based on the average
historical volatility for the 36-month period ending on the grant date;
(iii) an average dividend yield of 5.68%, based on the average yield for a
36-month period; and (iv) the exercise of all options on the final day of
their 10-year terms. No discount from the theoretical value was taken to
reflect the restrictions on the transfer of the options and the likelihood
of the options being exercised in advance of the final day of their terms.
(3) Information with respect to Mr. Hafer's options is included in the
EXECUTIVE COMPENSATION section of GPU, Inc.'s Proxy Statement for the 1999
Annual Meeting of Stockholders, which is incorporated herein by reference.
(4) Information with respect to Mr. Baldassari's options is included in the
EXECUTIVE COMPENSATION section of GPU, Inc.'s Proxy Statement for the 1999
Annual Meeting of Stockholders, which is incorporated herein by reference.
LONG-TERM INCENTIVE PLANS - AWARDS IN LAST FISCAL YEAR
------------------------------------------------------
This table shows the LTIP awards made to the Named Executive Officers for
the performance period January 1, 1998 through December 31, 2002.
<TABLE>
<CAPTION>
Performance Estimated future payouts
Number of or other under non-stock price-
shares, period until based plans(1)
--------------------------------------
units or maturation Threshold Target Maximum
Name other rights or payout (#) (#) (#)
---- ------------- --------------- ---------- --------------------------- --------
<S> <C> <C> <C> <C> <C>
F. D. Hafer (2) (2) (2) (2) (2)
D. Baldassari (2) (2) (2) (2) (2)
R. S. Zechman 1,060 5 year vesting 530 1,060 2,120
D. J. Howe 1,060 5 year vesting 530 1,060 2,120
C. A. Mascari 1,060 5 year vesting 530 1,060 2,120
C. Brooks 1,060 5 year vesting 530 1,060 2,120
</TABLE>
(1) The restricted units awarded in 1998 under the 1990 Stock Plan provide for a
performance adjustment to the aggregate number of units vesting for the
recipient, including the accumulated reinvested dividend equivalents, based
on the annualized GPU Total Shareholder Return (TSR) percentile ranking
against all companies in the Standard & Poor's Electric Utility Index for
the period between the award and vesting dates. With a 55th percentile
ranking, the performance adjustment would be 100% as reflected in the
"Target" column. In the event that the percentile ranking is below the 55th
percentile, the performance adjustment would be reduced in
20
<PAGE>
steps reaching 0% below the 40th percentile. The minimum payout or
"Threshold" begins at the 40th percentile, which results in a payout of 50%
of target. A ranking below the 40th percentile would result in no award.
Should the TSR percentile ranking exceed the 59th percentile, then the
performance adjustment would be increased in steps reaching 200% at the 90th
percentile as reflected in the "Maximum" column. Under the 1990 Stock Plan,
regular quarterly dividends are reinvested in additional units that are
subject to the vesting restrictions of the award. Actual payouts under the
Plan would be based on the aggregate number of units awarded and the units
accumulated through dividend reinvestment at the time the restrictions
lapse.
(2) Information with respect to Mr. Hafer's and Mr. Baldassari's long-term
incentive plans is included in the EXECUTIVE COMPENSATION section of GPU,
Inc.'s Proxy Statement for the 1999 Annual Meeting of Stockholders, which is
incorporated herein by reference.
Proposed Remuneration of Executive Officers
- -------------------------------------------
None of the Named Executive Officers in the Summary Compensation Table has
an employment contract. The compensation of executive officers is determined
from time to time by the Personnel & Compensation Committee of the GPU, Inc.
Board of Directors.
Retirement Plans
- ----------------
The GPU Companies' pension plans provide for pension benefits, payable for
life after retirement, based upon years of creditable service with the GPU
Companies and the employee's career average compensation as defined below.
Federal law limits the amount of an employee's pension benefits that may be paid
from a qualified trust established pursuant to a qualified pension plan (such as
the GPU Companies' plans). The GPU Companies also have adopted non-qualified
plans providing that the portion of a participant's pension benefits which, by
reason of such limitations, cannot be paid from such a qualified trust shall be
paid directly on an unfunded basis by the participant's employer.
The following table illustrates the amount of aggregate annual pension from
funded and unfunded sources resulting from employer contributions to the
qualified trust and direct payments payable upon retirement in 1999 (computed on
a single life annuity basis) to persons in specified compensation and years of
service classifications:
21
<PAGE>
ESTIMATED ANNUAL RETIREMENT BENEFITS (2) (3) (4)
BASED UPON CAREER AVERAGE COMPENSATION
--------------------------------------
(1999 Retirement)
<TABLE>
<CAPTION>
Career
Average
Compen- Years of Service
---------------------------------------------------------
sation(1) 15 20 25 30 35 40
- ------------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$ 50,000 $ 13,879 $ 18,506 $ 23,132 $ 27,759 $ 32,385 $ 36,761
100,000 28,879 38,506 48,132 57,759 67,385 76,361
150,000 43,879 58,506 73,132 87,759 102,385 115,961
200,000 58,879 78,506 98,132 117,759 137,385 155,561
250,000 73,879 98,506 123,132 147,759 172,385 195,161
300,000 88,879 118,506 148,132 177,759 207,385 234,761
350,000 103,879 138,506 173,132 207,759 242,385 274,361
400,000 118,879 158,506 198,132 237,759 277,385 313,961
450,000 133,879 178,506 223,132 267,759 312,385 353,561
500,000 148,879 198,506 248,132 297,759 347,385 393,161
550,000 163,879 218,506 273,132 327,759 382,385 432,761
600,000 178,879 238,506 298,132 357,759 417,385 472,361
650,000 193,879 258,506 323,132 387,759 452,385 511,961
700,000 208,879 278,506 348,132 417,759 487,385 551,561
750,000 223,879 298,506 373,132 447,759 522,385 591,161
800,000 238,879 318,506 398,132 477,759 557,385 630,761
</TABLE>
(1) Career Average Compensation is the average annual compensation received from
January 1, 1984 to retirement and includes Salary and Bonus. The career
average compensation amounts for the following Named Executive Officers
differ by more than 10% from the three year average annual compensation set
forth in the Summary Compensation Table and are as follows: Messrs. Hafer -
$355,761; Baldassari - $223,671; Zechman - $129,791; Howe - $108,014;
Mascari - $129,386; and Brooks - $123,784.
(2) Years of Creditable Service at December 31, 1998: Messrs. Hafer - 36 years;
Baldassari - 29 years; Zechman - 29 years; Howe - 22 years; Mascari - 25
years; and Brooks - 25 years.
(3) Based on an assumed retirement at age 65 in 1999. To reduce the above
amounts to reflect a retirement benefit assuming a continual annuity to a
surviving spouse equal to 50% of the annuity payable at retirement, multiply
the above benefits by 90%. The estimated annual benefits are not subject to
any reduction for Social Security benefits or other offset amounts.
(4) Annual retirement benefits under the basic pension per the above table
cannot exceed 55%, as defined in the pension plan, of the average
compensation during the highest paid 36 calendar months. As of December 31,
1998, none of the Named Executive Officers exceed the 55% limit.
22
<PAGE>
Remuneration of JCP&L Directors
- -------------------------------
Nonemployee directors receive an annual retainer of $15,000, a fee of $1,000
for each Board meeting attended, and a fee of $1,000 for each Committee meeting
attended.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information required by this Item for GPU, Inc. is incorporated by
reference to the SECURITY OWNERSHIP section of GPU, Inc.'s Proxy Statement for
the 1999 Annual Meeting of Stockholders.
All of the outstanding shares of JCP&L (15,371,270), Met-Ed (859,500) and
Penelec (5,290,596) common stock are owned beneficially and of record by their
parent, GPU, Inc., 300 Madison Avenue, Morristown, NJ 07962.
The following table sets forth, as of February 1, 1999, the beneficial
ownership of equity securities (and stock-equivalent units) of each of the
directors and each of the executive officers named in the Summary Compensation
Table, and of all directors and executive officers of each of the respective GPU
Energy companies as a group. The shares of Common Stock owned by all directors
and executive officers as a group constitute less than 1% of the total shares
outstanding.
<TABLE>
<CAPTION>
Amount and Nature of Beneficial Ownership
Shares(1) Stock-Equivalent
------------------- ----------------
Name Title of Security Direct Indirect Units(2)
- ---- ----------------- --------- -------- --------
<S> <C> <C> <C> <C>
JCP&L/Met-Ed/Penelec:
- ----------------------
F. D. Hafer GPU Common Stock 9,795 146 25,677
D. Baldassari GPU Common Stock 4,766 - 14,999
R. S. Zechman GPU Common Stock 2,147 - 5,281
D. J. Howe GPU Common Stock 481 - 3,475
C. A. Mascari GPU Common Stock - 5 6,419
C. Brooks GPU Common Stock 805 138 4,979
C. B. Snyder GPU Common Stock 344 - 5,403
JCP&L Only:
- -------------
G. E. Persson GPU Common Stock None
S. C. Van Ness GPU Common Stock None
S. B. Wiley GPU Common Stock None
All Directors and
Executive Officers
as a Group GPU Common Stock 40,518 289 118,064
</TABLE>
(1) The number of shares owned and the nature of such ownership, not being
within the knowledge of GPU, have been furnished by each individual.
(2) Restricted units, which do not have voting rights, represent rights (subject
to vesting) to receive shares of Common Stock under the 1990 Stock Plan for
Employees of GPU, Inc. and Subsidiaries (the "1990 Stock Plan"). These
amounts also include restricted units which have vested under the 1990 Stock
Plan, but which were deferred pursuant to that Plan by Mr. Mascari - 1,266
units. See Summary Compensation Table above.
23
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
ASSETS
Utility Plant:
In service, at original cost $4,755,273 $4,755,273
Less, accumulated depreciation 2,217,108 2,217,108
--------- ---------
Net utility plant in service 2,538,165 2,538,165
Construction work in progress 48,126 48,126
Other, net 98,491 98,491
--------- ---------
Net utility plant 2,684,782 2,684,782
--------- ---------
Other Property and Investments:
Common stock of subsidiary - $ 16,945 16,945
Nuclear decommissioning trusts 422,277 422,277
Nuclear fuel disposal trust 116,871 116,871
Other, net 9,596 9,596
--------- ------- ---------
Total other property and investments 548,744 16,945 565,689
--------- ------- ---------
Current Assets:
Cash and temporary cash investments 1,850 1,849 $ 1
Special deposits 6,047 6,047
Accounts receivable:
Customers, net 152,120 152,120
Other 32,562 13,365 32,562 13,365
Unbilled revenues 56,391 56,391
Materials and supplies, at average cost or less:
Construction and maintenance 79,863 79,863
Fuel 13,144 13,144
Deferred income taxes 20,812 20,812
Prepayments 27,648 27,648
--------- ------- --------- -------
Total current assets 390,437 13,365 390,436 13,366
--------- ------- --------- -------
Deferred Debits and Other Assets:
Regulatory assets, net:
Other regulatory assets, net 753,885 753,885
Deferred income taxes 179,237 179,237
Other 25,037 128,866 25,037 128,866
--------- ------- --------- -------
Total deferred debits and other assets 958,159 128,866 958,159 128,866
--------- ------- --------- -------
Total Assets $4,582,122 $159,176 $4,599,066 $142,232
--------- ======= ========= =======
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
1
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
LIABILITIES AND CAPITAL
Capitalization:
Common stock $ 153,713 $ 1 $ 153,713 $ 1
Capital surplus 510,769 16,753 510,769 16,753
Retained earnings 893,016 191 893,016 191
Accumulated other comprehensive income/
(loss) (425) (425)
---------- ------- --------- -------
Total common stockholder's equity 1,557,073 16,945 1,557,073 16,945
Cumulative preferred stock:
With mandatory redemption 86,500 86,500
Without mandatory redemption 37,741 37,741
Company-obligated mandatorily redeemable
preferred securities 125,000 125,000
Long-term debt 1,173,532 128,866 1,302,398
--------- ------- --------- -------
Total capitalization 2,979,846 145,811 2,983,712 141,945
--------- ------- ---------
Current Liabilities:
Securities due within one year 2,512 2,512
Notes payable 122,344 122,344
Obligations under capital leases 85,366 85,366
Accounts payable
Affiliates 40,861 40,861
Other 80,233 13,365 93,598
Taxes accrued 5,559 5,319 240
Deferred energy credits 2,411 2,411
Interest accrued 26,678 26,631 47
Other 104,408 104,408
--------- ------- --------- -------
Total current liabilities 470,372 13,365 483,450 287
--------- ------- --------- -------
Deferred Credits and Other Liabilities:
Deferred income taxes 670,961 670,961
Unamortized investment tax credits 50,225 50,225
Three Mile Island Unit 2 future costs 120,904 120,904
Nuclear fuel disposal fee 141,270 141,270
Other 148,544 148,544
--------- ------- --------- -------
Total deferred credits and other liabilities 1,131,904 - 1,131,904 -
--------- ------- --------- -------
Total Liabilities and Capital $ 4,582,122 $159,176 $4,599,066 $142,232
========= ======= ========= =======
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
2
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Statement of Income
For the Year Ended December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
Operating Revenues $2,069,648 $2,069,648
--------- ------ ---------
Equity in Earnings of Subsidiary - $ 1,055 1,055
--------- ------ ---------
Operating Expenses:
Fuel 86,431 86,431
Power purchased and interchanged:
Affiliates 57,643 57,643
Other 658,742 658,742
Deferral of energy and capacity costs, net (25,542) (25,542)
Other operation and maintenance 485,054 485,054
Depreciation and amortization 250,675 250,675
Taxes, other than income taxes 94,586 94,586
--------- ------ ---------
Total operating expenses 1,607,589 - 1,607,589
--------- ------ ---------
Operating Income Before Income Taxes 462,059 1,055 463,114
Income taxes 164,445 (568) 163,877
--------- ------ ---------
Operating Income 297,614 1,623 299,237
--------- ------ ---------
Other Income and Deductions:
Allowance for other funds used
during construction 786 786
Other income, net 13,227 12,395 13,306 $12,316
Income taxes 19,367 (568) 19,367 (568)
--------- ------ --------- ------
Total other income and deductions 33,380 11,827 33,459 11,748
--------- ------ --------- ------
Income Before Interest Charges 330,994 13,450 332,696 11,748
--------- ------ --------- ------
Interest Charges :
Interest on long-term debt 87,261 87,261
Other interest 12,229 12,395 24,631 (7)
Allowance for borrowed funds used
during construction (1,638) (1,638)
Dividends on company-obligated mandatorily
redeemable preferred securities 10,700 10,700
--------- ------ --------- ------
Total interest charges 108,552 12,395 110,254 10,693
--------- ------ --------- ------
Net Income $ 222,442 $ 1,055 $ 222,442 $ 1,055
========= ====== ========= ======
Preferred stock dividends 10,065 10,065
------ ------
Earnings Available for Common Stock 212,377 212,377
------- -------
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
3
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Statement of Comprehensive Income
For the Year Ended December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
Net Income $222,442 $ 1,055 $222,442 $ 1,055
Other comprehensive income/(loss), net of tax:
Net unrealized gains on investments
Minimum pension liability (425) (425)
------- ------ ------- -------
Total other comprehensive income $ (425) $ - $ (425) $ -
------- ------ ------- -------
Comprehensive income $222,017 $ 1,055 $222,017 $ 1,055
======= ====== ======= =======
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
4
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Statement of Retained Earnings
For the Year Ended December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
Balance at beginning of year $ 875,639 $ 142 $ 875,639 $ 142
Net income 222,442 1,055 222,442 1,055
Cash dividends declared on common stock (195,000) (1,006) (195,000) (1,006)
Cash dividends on cumulative preferred stock (10,065) (10,065)
Other adjustments, net -
-------- ------ -------- ------
Balance at end of year $ 893,016 $ 191 $ 893,016 $ 191
======== ====== ======== ======
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
5
<PAGE>
Jersey Central Power & Light Company and Subsidiary Company Exhibit F-2
Consolidating Statement of Cash Flows
For the Year Ended December 31, 1998
-----------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Jersey Central Power
& Light Company
and Subsidiary Eliminations Jersey Central JCP&L
Company and Power & Light Preferred
Consolidated Adjustments Company Capital, Inc.
-------------------- ------------ -------------- -------------
<S> <C> <C> <C> <C>
Operating Activities:
Net income $ 222,442 $ 1,055 $ 222,442 $ 1,055
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiary - (1,055) (1,055)
Depreciation and amortization 277,950 277,950
Amortization of property under capital leases 26,739 26,739
Nuclear outage maintenance costs, net (6,640) (6,640)
Deferred income taxes and investment tax credit
net (41,865) (41,865)
Deferred energy and capacity costs, net (24,482) (24,482)
Accretion income
Allowance for other funds used during
construction (786) (786)
Changes in working capital:
Receivables (9,407) (9,369) (38)
Materials and supplies 3,863 3,863
Special deposits and prepayments (12,450) (12,450)
Payables and accrued liabilities 1,418 1,429 (11)
Nonutility generation contract buyout costs (15,000) (15,000)
Other, net 13,091 13,091
-------- ------ -------- -------
Net cash provided by operating activities 434,873 - 433,867 1,006
-------- ------ -------- -------
Investing Activities:
Capital expenditures and investments (154,918) (154,918)
Contributions to decommissioning trusts (28,003) (28,003)
Other, net (10,720) (10,720)
-------- ------ -------- -------
Net cash used for investing activities (193,641) - (193,641) -
-------- ------ -------- -------
Financing Activities:
Increase in notes payable, net 7,090 7,090
Retirement of long-term debt (11) (11)
Capital lease principal payments (29,084) (29,084)
Redemption of preferred stock (15,000) (15,000)
Dividends paid on preferred stock (10,371) (10,371)
Dividends paid on common stock (195,000) (195,000)
Dividends paid on common stock - Internal - 1,006 (1,006)
-------- ------ -------- -------
Net cash required by financing activities (242,376) - (241,370) (1,006)
-------- ------ -------- -------
Net increase in cash and temporary cash
investments from above activities (1,144) - (1,144) -
Cash and temporary cash investments, beginning of year 2,994 - 2,993 1
-------- ------ -------- -------
Cash and temporary cash investments, end of year $ 1,850 $ - $ 1,849 $ 1
======== ====== ======== =======
Supplemental Disclosure:
Interest paid $ 116,942 $ 116,942
======== ========
Income taxes paid $ 192,335 $ 192,335
======== ========
New capital lease obligations incurred $ 32,680 $ 32,680
======== ========
</TABLE>
_______________
The notes to the consolidated financial statements of JCP&L, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
6
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
ASSETS
Utility Plant:
In service, at original cost $2,247,627 $2,223,273 $24,354
Less, accumulated depreciation 1,008,438 1,001,844 6,594
--------- --------- ------
Net utility plant in service 1,239,189 1,221,429 17,760
Construction work in progress 19,380 19,380
Other, net 27,819 27,819
--------- --------- -------
Net utility plant 1,286,388 1,268,628 17,760
--------- --------- ------
Other Property and Investments:
Common stock of subsidiaries - $ 31,085 31,085
Nuclear decommissioning trusts 211,194 211,194
Other, net 11,742 11,742
--------- ------- ---------
Total other property and investments 222,936 31,085 254,021
--------- ------- ---------
Current Assets:
Cash and temporary cash investments 442 223 $ 1 218
Special deposits 1,062 1,062
Accounts receivable:
Customers, net 60,012 60,012
Other 41,895 11,966 41,671 10,962 1,228
Unbilled revenues 43,687 43,687
Materials and supplies, at average cost
or less:
Construction and maintenance 24,727 24,727
Fuel 12,218 12,218
Deferred income taxes 2,945 2,945
Prepayments 20,616 20,616
--------- ------- --------- ------- ------
Total current assets 207,604 11,966 207,161 10,963 1,446
--------- ------- --------- ------- ------
Deferred Debits and Other Assets:
Regulatory assets, net:
Competitive transition charge 680,213 680,213
Other regulatory assets, net 921,934 921,482 452
Deferred income taxes 714,202 714,259 (57)
Other 31,692 103,093 31,692 103,093
--------- ------- --------- ------- ------
Total deferred debits and other assets 2,348,041 103,093 2,347,646 103,093 395
--------- ------- --------- ------- ------
Total Assets $4,064,969 $146,144 $4,077,456 $114,056 $19,601
========= ======= --------- ======= ======
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
7
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
LIABILITIES AND CAPITAL
Capitalization:
Common stock $ 66,273 $ 1,164 $ 66,273 $ 1 $ 1,163
Capital surplus 370,200 18,262 370,200 13,402 4,860
Retained earnings 234,066 11,659 234,066 170 11,489
Accumulated other comprehensive income 16,520 16,520
--------- ------- --------- ------- ------
Total common stockholder's equity 687,059 31,085 687,059 13,573 17,512
Cumulative preferred stock 12,056 12,056
Company-obligated mandatorily redeemable
preferred securities 100,000 100,000
Long-term debt 546,904 103,093 649,997
--------- ------- --------- ------- ------
Total capitalization 1,346,019 134,178 1,349,112 113,573 17,512
--------- ------- --------- ------- ------
Current Liabilities:
Securities due within one year 30,024 30,024
Notes payable 79,540 79,540
Obligations under capital leases 27,135 27,135
Accounts payable
Affiliates 75,933 75,933
Other 102,390 11,966 114,356
Taxes accrued 19,463 18,575 421 467
Interest accrued 16,747 16,685 62
Other 42,598 42,598
--------- ------- --------- ------- ------
Total current liabilities 393,830 11,966 404,846 483 467
--------- ------- --------- ------- ------
Deferred Credits and Other Liabilities:
Deferred income taxes 1,010,982 1,009,403 1,579
Three Mile Island Unit 2 future costs 241,707 241,707
Unamortized investment tax credits 27,157 27,114 43
Nuclear fuel disposal fee 31,912 31,912
Nonutility generation contract loss
liability 787,440 787,440
Other 225,922 225,922
--------- ------- --------- ------- ------
Total deferred credits and other
liabilities 2,325,120 - 2,323,498 - 1,622
--------- ------- --------- ------- ------
Total Liabilities and Capital $4,064,969 $146,144 $4,077,456 $114,056 $19,601
--------- ======= --------- ======= ------
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
8
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Income
For the Year Ended December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ---------
<S> <C> <C> <C> <C> <C>
Operating Revenues $919,594 $ 6,871 $919,447 $ 7,018
------- ------ ------- -----
Equity in Earnings of Subsidiaries - 2,265 2,265
------- ------ -------
Operating Expenses:
Fuel 99,511 99,511
Power purchased and interchanged:
Affiliates 17,766 6,871 24,637
Other 220,095 220,095
Other operation and maintenance 247,189 243,368 3,821
Depreciation and amortization 109,148 108,481 667
Taxes, other than income taxes 58,459 58,200 259
------- ------ ------- -----
Total operating expenses 752,168 6,871 754,292 4,747
------- ------ ------- -----
Operating Income Before Income Taxes 167,426 2,265 167,420 2,271
Income taxes 42,979 (472) 41,317 1,190
------- ------ ------- -----
Operating Income 124,447 2,737 126,103 1,081
------- ------ ------- -----
Other Income and Deductions:
Allowance for other funds used
during construction 130 130
Other income/(expense), net (13,539) 10,374 (13,558) $ 10,374 19
Income taxes 5,556 (472) 5,574 (481) (9)
------- ------ ------- ------ -----
Total other income and deductions (7,853) 9,902 (7,984) 9,893 140
------- ------ ------- ------ -----
Income Before Interest Charges 116,594 12,639 118,119 9,893 1,221
------- ------ ------- ------ -----
Interest Charges :
Interest on long-term debt 42,493 42,493
Other interest 8,194 10,374 18,568
Allowance for borrowed funds used
during construction (813) (813)
Dividends on company-obligated mandatorily
redeemable preferred securities 9,000 9,000
------- ------ ------- ------ -----
Total interest charges 58,874 10,374 60,248 9,000
------- ------ ------- ------ -----
Income Before Extraordinary Item $ 57,720 $ 2,265 $ 57,871 $ 893 $ 1,221
======= ====== ======= ====== =====
Extraordinary item (net of income taxes
of $4,708) (6,805) (6,956) 151
------- ------- ---
Net Income 50,915 2,265 50,915 893 1,372
------- ------ ------- --- -----
Preferred stock dividends 483 483
Gain on preferred stock reacquisition - -
------- -------
Earnings Available for Common Stock 50,432 50,432
------- -------
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual Report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
9
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Comprehensive Income
For the Year Ended December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
Net Income $ 50,915 $ 2,265 $ 50,915 $ 893 $ 1,372
Other comprehensive income/(loss), net of tax:
Net unrealized gains on investments 4,148 4,148
Minimum pension liability (115) (115)
------- ------ ------- ------- -------
Total other comprehensive income $ 4,033 $ - $ 4,033 $ - $ -
------- ------ ------- ------- -------
Comprehensive income $ 54,948 $ 2,265 $ 54,948 $ 893 $ 1,372
======= ====== ======= ======= =======
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
10
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Retained Earnings
For the Year Ended December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
Balance at beginning of year $ 268,634 $ 10,221 $ 268,634 $ 104 $ 10,117
Net income 50,915 2,265 50,915 893 1,372
Cash dividends declared on common stock (85,000) (827) (85,000) (827)
Cash dividends on cumulative preferred
stock (483) - (483)
Other adjustments, net -
-------- -------- -------- -------- -------
Balance at end of year $ 234,066 $ 11,659 $ 234,066 $ 170 $ 11,489
======== ======== ======== ======== =======
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
11
<PAGE>
Metropolitan Edison Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Cash Flows
For the Year Ended December 31, 1998
----------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Metropolitan
Edison Company
and Subsidiary Eliminations Metropolitan Met-Ed York Haven
Companies and Edison Preferred Power
Consolidated Adjustments Company Capital, Inc. Company
-------------- ------------ ------------ ------------- ----------
<S> <C> <C> <C> <C> <C>
Operating Activities:
Net income $ 50,915 $ 2,265 $ 050,915 $ 893 $ 1,372
Extraordinary item (net of income tax benefit
of $4,708) 6,805 _ 6,956 _ (151)
-------- -------- -------- -------- --------
Income before extraordinary item 57,720 2,265 57,871 893 1,221
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiaries - (2,265) (2,265)
Depreciation and amortization 114,961 114,290 671
Amortization of property under capital leases 14,666 14,666
PaPUC restructuring rate orders 32,900 32,900
Nuclear outage maintenance costs, net 6,494 6,494
Deferred income taxes and investment
tax credits, net (23,152) (23,123) (29)
Allowance for other funds used during construction (130) (1) (129)
Deferred energy costs 3 (3)
Changes in working capital:
Receivables (11,292) (10,523) (58) (711)
Materials and supplies (1,911) (1,911)
Special deposits and prepayments (13,861) (13,872) 11
Payables and accrued liabilities 23,504 23,086 (8) 426
Nonutility generation contract buyout costs (32,917) (32,917)
Other, net 6,566 6,415 151
-------- -------- -------- -------- --------
Net cash provided by operating activities 173,548 - 171,113 827 1,608
-------- -------- -------- -------- --------
Investing Activities:
Capital expenditures and investments (75,068) (70,756) (4,312)
Contributions to decommissioning trusts (17,766) (17,766)
Other, net 465 465
-------- -------- -------- -------- --------
Net cash used for investing activities (92,369) - (88,057) - (4,312)
-------- -------- -------- -------- --------
Financing Activities:
Issuance of long-term debt -
Increase in notes payable, net 12,261 12,261
Retirement of long-term debt (22) (22)
Capital lease principal payments (13,609) (13,609)
Contributions received from parent corporation (1,900) 1,900
Dividends paid on preferred stock (483) (483)
Dividends paid on common stock (85,000) (85,000)
Dividends paid on common stock - Internal - 827 (827)
Capital stock paid-in capital
-------- -------- -------- -------- --------
Net cash required by financing activities $ (86,853) $ - $ (87,926) $ (827) $ 1,900
-------- -------- -------- -------- --------
Net increase (decrease) in cash and temporary cash
investments from above activities (5,674) - (4,870) - (804)
Cash and temporary cash investments, beginning of year 6,116 - 5,093 1 1,022
-------- -------- -------- -------- --------
Cash and temporary cash investments, end of year $ 442 $ - $ 223 $ 1 $ 218
======== ======== ======== ======== ========
Supplemental Disclosure:
Interest paid $ 57,891 $ 10,430 $ 59,321 $ 9,000
======== ======== ======== ========
Income taxes paid $ 77,296 $ 76,450 $ 470 $ 376
======== ======== ======== ========
New capital lease obligations incurred $ 3,399 $ 3,399
======== ========
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
12
<PAGE>
Pennsylvania Electric Company and Subsidiary Companies Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Pennsylvania
Electric Company Waverly
and Subsidiary Eliminations Pennsylvania Penelec Nineveh Elec. Light
Companies and Electric Preferred Water and Power
Consolidated Adjustments Company Capital, Inc. Company Company
---------------- ------------ ------------ ------------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Utility Plant:
In service, at original cost $2,802,360 $2,801,313 $1,032 $15
Less, accumulated depreciation 1,175,842 1,175,578 264
--------- --------- ----- --
Net utility plant in service 1,626,518 1,625,735 768 15
Construction work in progress 18,862 18,862
Other, net 19,482 19,482
--------- --------- ----- --
Net utility plant 1,664,862 1,664,079 768 15
--------- --------- ----- --
Other Property and Investments:
Common stock of subsidiaries - $ 15,804 15,804
Nuclear decommissioning trusts 82,803 82,803
Other, net 7,705 7,705
--------- ------- --------- ----- --
Total other property and investments 90,508 15,804 106,312 - -
--------- ------- --------- ----- --
Current Assets:
Cash and temporary cash investments 2,750 1,913 $ 1 836
Special deposits 2,632 2,632
Accounts receivable:
Customers, net 69,887 69,887
Other 28,893 11,543 28,888 11,543 5
Unbilled revenues 43,998 43,998
Materials and supplies, at average
cost or less:
Construction and maintenance 39,452 39,452
Fuel 17,107 17,107
Deferred income taxes 7,589 7,589
Prepayments 31,551 31,551
--------- ------- --------- ------- ----- --
Total current assets 243,859 11,543 243,017 11,544 841 -
--------- ------- --------- ------- ----- --
Deferred Debits and Other Assets:
Regulatory assets, net:
Competitive transition charge 343,602 343,602
Other regulatory assets, net 1,206,594 1,206,594
Deferred income taxes 951,471 951,471
Other 23,911 108,248 23,911 108,248
--------- ------- --------- ------- ----- --
Total deferred debits and other assets 2,525,578 108,248 2,525,578 108,248 - -
--------- ------- --------- ------- ----- --
Total Assets $4,524,807 $135,595 $4,538,986 $119,792 $1,609 $15
--------- ======= --------- ======= ===== ==
</TABLE>
_______________
The notes to the consolidated financial statements of Penelec, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
13
<PAGE>
Pennsylvania Electric Company and Subsidiary Companies Exhibit F-2
Consolidating Balance Sheet
December 31, 1998
------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Pennsylvania
Electric Company Waverly
and Subsidiary Eliminations Pennsylvania Penelec Nineveh Elec. Light
Companies and Electric Preferred Water and Power
Consolidated Adjustments Company Capital, Inc. Company Company
---------------- ------------ ------------ ------------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
LIABILITIES AND CAPITAL
Capitalization:
Common stock $ 105,812 $ 17 $ 105,812 $ 1 $ 1 $15
Capital surplus 285,486 15,439 285,486 14,072 1,367
Retained earnings 367,653 348 367,653 180 168
Accumluated other comprehensive
income/(loss) 8,353 - 8,353 - - -
--------- ------- --------- ------- ----- ---
Total common stockholder's
equity 767,304 15,804 767,304 14,253 1,536 15
Cumulative preferred stock 16,681 16,681
Company-obligated mandatorily
redeemable preferred securities 105,000 105,000
Long-term debt 626,434 108,248 734,682
--------- ------- --------- ------- ----- ---
Total capitalization 1,515,419 124,052 1,518,667 119,253 1,536 15
--------- ------- --------- ------- ----- ---
Current Liabilities:
Securities due within one year 50,012 50,012
Notes payable 86,023 86,023
Obligations under capital leases 13,979 13,979
Accounts payable
Affiliates 47,164 47,164
Other 47,795 11,543 59,338
Taxes accrued 32,755 32,276 474 5
Interest accrued 19,700 19,635 65
Other 37,272 37,272
--------- ------- --------- ------- ----- ---
Total current liabilities 334,700 11,543 345,699 539 5 -
--------- ------- --------- ------- ----- ---
Deferred Credits and Other Liabilities:
Deferred income taxes 1,338,235 1,338,204 31
Unamortized investment tax credits 36,926 36,889 37
Three Mile Island Unit 2 future
costs 120,904 120,904
Nuclear fuel disposal fee 15,956 15,956
Nonutility generation contract loss
liability 1,016,380 1,016,380
Other 146,287 146,287
--------- ------- --------- ------- ----- ---
Total deferred credits and other
Liabilities 2,674,688 2,674,620 - 68 -
--------- ------- --------- ------- ----- ---
Total Liabilities and Capital $4,524,807 $135,595 $4,538,986 $119,792 $1,609 $ 15
--------- ======= --------- ------- ===== ===
</TABLE>
_______________
The notes to the consolidated financial statements of Penelec, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
14
<PAGE>
Pennsylvania Electric Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Income
For the Year Ended December 31, 1998
------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Pennsylvania
Electric Company Waverly
and Subsidiary Eliminations Pennsylvania Penelec Nineveh Elec. Light
Companies and Electric Preferred Water and Power
Consolidated Adjustments Company Capital, Inc. Company Company
---------------- ------------ ------------ ------------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues $1,032,226 $1,032,226 $ -
--------- --------- ----
Equity in Earnings of Subsidiaries - $ 955 955
--------- ------ ---------
Operating Expenses:
Fuel 176,548 176,548
Power purchased and interchanged:
Affiliates 2,729 2,729
Other 233,395 233,395
Deferral of energy and capacity
costs, net
Other operation and maintenance 275,107 275,107
Depreciation and amortization 109,800 109,788 $ 12
Taxes, other than income taxes 63,874 63,864 10
--------- ------ --------- --- ----
Total operating expenses 861,453 - 861,431 22
--------- ------ --------- --- ----
Operating Income Before Income Taxes 170,773 955 171,750 (22)
Income taxes 45,150 (508) 44,653 (11)
--------- ------ --------- --- ----
Operating Income 125,623 1,463 127,097 (11)
--------- ------ --------- --- ----
Other Income and Deductions:
Other income, net (6,429) 10,628 (6,470) $ 10,628 41
Income taxes 2,613 (508) 2,630 (508) (17)
--------- ------ --------- ------ --- ----
Total other income and
Deductions (3,816) 10,120 (3,840) 10,120 24
--------- ------ --------- ------ --- ----
Income Before Interest Charges 121,807 11,583 123,257 10,120 13
--------- ------ --------- ------ --- ----
Interest Charges :
Interest on long-term debt 47,729 47,729
Other interest 8,197 10,628 18,824 1
Allowance for borrowed funds used
during construction (1,897) (1,886) (11)
Dividends on company-obligated
mandatorily redeemable
preferred securities 9,188 9,188
--------- ------ --------- ------ --- ----
Total interest charges 63,217 10,628 64,667 9,177 1
--------- ------ --------- ------ --- ----
Income Before Extraordinary Item $ 58,590 $ 955 $ 58,590 $ 943 $ 12 $ -
========= ====== ========= ======= === ====
Extraordinary Item (net of income
taxes of $11,592) (18,950) (18,950)
-------- -------
Net Income 39,640 955 39,640 943 12 -
------ --- ------ --- --- ----
Preferred stock dividends 695 695
Gain on preferred stock
Reacquisition - -
--------- ---------
Earnings Available for Common Stock 38,945 38,945
--------- ---------
</TABLE>
_______________
The notes to the consolidated financial statements of Penelec, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
15
<PAGE>
Pennsylvania Electric Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Comprehensive Income
For the Year Ended December 31, 1998
------------------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
Pennsylvania
Electric Company Waverly
and Subsidiary Eliminations Pennsylvania Penelec Nineveh Elec. Light
Companies and Electric Preferred Water and Power
Consolidated Adjustments Company Capital, Inc. Company Company
---------------- ------------ ------------ ------------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Income $ 39,640 $ 955 $ 39,640 $ 943 $ 12 $ -
Other comprehensive income/(loss), net of tax:
Net unrealized gains on investments 2,064 2,064
Minimum pension liability (42) (42)
------- ------ ------- ------- ----- -----
Total other comprehensive income $ 2,022 $ - $ 2,022 $ - - -
------- ------ ------- ------- ----- -----
Comprehensive income $ 41,662 $ 955 $ 41,662 $ 943 $ 12 $ -
======= ====== ======= ======= ===== =====
</TABLE>
_______________
The notes to the consolidated financial statements of Met-Ed, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
16
<PAGE>
<TABLE>
<CAPTION>
Pennsylvania Electric Company and Subsidiary Companies EXHIBIT F-2
Consolidating Statement of Retained Earnings
For the Year Ended December 31, 1998
------------------------------------------------------
(In Thousands)
Pennsylvania
Electric Company Waverly
and Subsidiary Eliminations Pennsylvania Penelec Nineveh Electric Light
Companies and Electric Preferred Water and Power
Consolidated Adjustments Company Capital, Inc. Company Company
------------ ----------- ------- ------------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Balance at beginning of year $ 393,708 $ 265 $ 393,708 $ 109 $156 $ -
Net income 39,640 955 39,640 943 12
Cash dividends declared on
common stock (65,000) (872) (65,000) (872)
Cash dividends on cumulative
preferred stock (695) (695)
Other adjustments, net
------- ------ -------- ----- --- ---
Balance at end of year $ 367,653 $ 348 $ 367,653 $ 180 $168 $ -
======== ====== ======== ===== === ===
</TABLE>
_________________
The notes to the consolidated financial statements of Penelec, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
17
<PAGE>
<TABLE>
<CAPTION>
Pennsylvania Electric Company and Subsidiary Companies Exhibit F-2
Consolidating Statement of Cash Flows
For the Year Ended December 31, 1998
---------------------------------------------------------
(In Thousands)
Pennsylvania
Electric Company
and Subsidiary Eliminations Pennsylvania Penelec
Companies and Electric Preferred
Consolidated Adjustments Company Capital, Inc.
--------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Operating Activities:
Net income $ 39,640 $ 955 $ 39,640 $ 943
Extraordinary item (net of income tax benefit
of $11,592) 18,950 18,950
------ ------
Income before extraordinary item 58,590 58,590
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiaries - (955) (955)
Depreciation and amortization 107,239 107,227
Amortization of property under capital leases 7,319 7,319
PaPUC restructuring rate orders 35,600 35,600
Nuclear outage maintenance costs, net 3,251 3,251
Deferred income taxes and
investment tax credits, net (15,496) (15,496)
Changes in working capital:
Receivables (2,661) (2,602) (61)
Materials and supplies (1,310) (1,310)
Special deposits and prepayments (1,878) (1,878)
Payables and accrued liabilities 39,061 39,075 (9)
Nonutility generation contract
buyout costs (6,101) (6,101)
Other, net (31,479) (31,479)
-------- ------ -------- -----
Net cash provided by operating
activities 192,135 - 191,241 873
-------- ------ -------- -----
Investing Activities:
Capital expenditures and investments (89,550) (89,550)
Contributions to decommissioning trusts (5,270) (5,270)
Other, net (520) (520)
--------- ------ -------- -----
Net cash used for investing
activities (95,340) - (95,340) -
-------- ------ ------- -----
Financing Activities:
Issuance of long-term debt
Increase in notes payable, net 8,442 8,442
Retirement of long-term debt (30,011) (30,011)
Capital lease principal payments (6,781) (6,781)
Dividends paid on preferred stock (695) (695)
Dividends paid on common stock (65,000) (65,000)
Dividends paid on common stock -
Internal - 872 (872)
-------- ------ -------- -----
Net cash required by financing
activities (94,045) - (93,173) (872)
-------- ------ -------- -----
Net increase in cash and temporary cash
investments from above activities 2,750 - 2,728 1
Cash and temporary cash investments,
beginning of year - - (815) 1
-------- ------ -------- -----
Cash and temporary cash investments,
end of year $ 2,750 $ - $ 1,913 $ 2
======== ====== ======== =====
Supplemental Disclosure:
Interest paid $ 64,057 $ 10,700 $ 65,570 $9,187
======== ------ ------ -----
Income taxes paid $ 46,732 $ 46,231 $ 497
======== ======== =====
New capital lease obligations incurred $ 1,714 $ 1,714
======== ========
<CAPTION>
Waverly
Ninevah Electric Light
Water and Power
Company Company
---------- ---------------
<S> <C> <C>
Operating Activities:
Net income $ 12 $ -
Extraordinary item (net of income tax benefit
of $11,592)
Income before extraordinary item
Adjustments to reconcile income to cash provided:
Equity in earnings of subsidiaries
Depreciation and amortization 12
Amortization of property under capital leases
PaPUC restructuring rate orders
Nuclear outage maintenance costs, net
Deferred income taxes and
investment tax credits, net
Changes in working capital:
Receivables 2
Materials and supplies
Special deposits and prepayments
Payables and accrued liabilities (5)
Nonutility generation contract
buyout costs
Other, net
--- ---
Net cash provided by operating
activities 21 -
--- ---
Investing Activities:
Capital expenditures and investments
Contributions to decommissioning trusts
Other, net
--- ---
Net cash used for investing
activities - -
--- ---
Financing Activities:
Issuance of long-term debt
Increase in notes payable, net
Retirement of long-term debt
Capital lease principal payments
Dividends paid on preferred stock
Dividends paid on common stock
Dividends paid on common stock -
Internal - -
--- ---
Net cash required by financing
activities - -
--- ---
Net increase in cash and temporary cash
investments from above activities 21 -
Cash and temporary cash investments,
beginning of year 814
--- -
Cash and temporary cash investments,
end of year $835
=== $ -
Supplemental Disclosure:
Interest paid
Income taxes paid $ 4
===
New capital lease obligations incurred
</TABLE>
_______________
The notes to the consolidated financial statements of Penelec, which are
incorporated by reference from the annual report on Form 10-K for the year ended
December 31, 1998, are an integral part of the consolidating financial
statements.
18
<PAGE>
Exhibit H-1
GPU International, Inc.
EWG Organizational Chart
------------------------
----------------------------------------
GPU International, Inc.
----------------------------------------
100%
----------------------------------------
EI Selkirk, Inc.
----------------------------------------
20%
----------------------------------------
Selkirk Cogeneration Partners
Limited Partnership
(EWG)
2 facilities
350 MW total
----------------------------------------
<PAGE>
Exhibit H-1
GPU International, Inc.
EWG Organizational Chart
------------------------
-------------------------------
GPU International, Inc.
-------------------------------
100%
-------------------------------
EI Canada Holding, Ltd.
(EWG)
------------------------------- 100%
----------------
EI Services
Canada, Ltd.
(EWG)
----------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-------------------------------
GPU Power, Inc.
(EWG)
-------------------------------
100%
-------------------------------
Guaracachi America, Inc.
(EWG)
-------------------------------
50%
-------------------------------
Empresa Guaracachi S.A.
(EWG)
3 facilities
216 MW total
-------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-------------------------------
GPU Power, Inc.
(EWG)
-------------------------------
100%
-------------------------------
EI Barranquilla, Inc.
(EWG)
-------------------------------
26%
-------------------------------
Termobarranquilla S.A.
(EWG)
2 facilities
990 MW total
556 MW under construction
-------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG)
---------------------------------
100%
---------------------------------
Barranquilla Lease Holding, Inc.
(EWG)
---------------------------------
100%
---------------------------------
Los Amigos Leasing Company, Ltd.
(EWG)
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG) ---
---------------------------------
100%
EI International
(EWG)
---------------------------------
52%
---------------------------------
GPUI Colombia, Ltda. 48%
(EWG) . ---
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG)
---------------------------------
100%
---------------------------------
Hanover Energy Corporation
(EWG)
Inactive
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG)
---------------------------------
100%
---------------------------------
EI Power (China) II, Inc.
(EWG)
Inactive
---------------------------------
50%
---------------------------------
Nanjing Power Partners, L.P.
(EWG)
Inactive
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG)
---------------------------------
100%
---------------------------------
EI Power (China) III, Inc.
(EWG)
Inactive
---------------------------------
50%
---------------------------------
Zhuang He Power Partners, L.P.
(EWG)
Inactive
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
---------------------------------
GPU Power, Inc.
(EWG)
---------------------------------
100%
---------------------------------
Austin Cogeneration Corporation
(EWG)
Inactive
---------------------------------
100%
---------------------------------
Austin Cogeneration
Partners, L.P.
(EWG)
Inactive
---------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-----------------------------------------
GPU Power, Inc.
(EWG)
-----------------------------------------
100%
-----------------------------------------
International Power
Advisors, Inc.
(EWG)
-----------------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-----------------------------------------
GPU Power, Inc.
(EWG)
-----------------------------------------
100%
-----------------------------------------
GPU Power Philippines, Inc.
-----------------------------------------
13.2%
-----------------------------------------
Magellan Utilities
Development Corporation
-----------------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-----------------------------------------
GPU Power, Inc.
(EWG)
-----------------------------------------
100%
-----------------------------------------
GPU International Asia, Inc.
(EWG)
-----------------------------------------
<PAGE>
Exhibit H-1
GPU Power, Inc.
EWG Organizational Chart
------------------------
-----------------------------------------
GPU Power, Inc.
-----------------------------------------
100%
-----------------------------------------
GPUI Power Ireland, Inc.
(EWG)
-----------------------------------------
<PAGE>
Exhibit H-1
GPU Capital, Inc.
FUCO Organizational Chart
-------------------------
----------------------------------
GPU Capital, Inc.
----------------------------------
100%
----------------------------------
GPU Electric, Inc.
(FUCO)
----------------------------------
100%
----------------------------------
GPU Australia
Holdings, Inc.
(FUCO)
----------------------------------
100%
------------------------
GPU GasNet Pty Ltd
------------------------
100 %
------------------------
GPU Gas Net.
Trading Pty Ltd
------------------------
100%
----------------------------------
Victoria Electric Holdings,
Inc.
(FUCO)
----------------------------------
100%
----------------------------------
Victoria Electric, Inc.
(FUCO)
----------------------------------
<PAGE>
Exhibit H-1
GPU Capital, Inc.
FUCO Organizational Chart
-------------------------
----------------------------------
GPU Capital, Inc.
----------------------------------
100%
----------------------------------
GPU Electric, Inc.
(FUCO)
----------------------------------
100%
----------------------------------
EI UK Holdings, Inc.
----------------------------------
50%
----------------------------------
Avon Energy
Partners Holdings
----------------------------------
100%
----------------------------------
Avon Energy
Partners plc
----------------------------------
100%
----------------------------------
Midlands Electricity plc
----------------------------------
100%
----------------------------------
Midlands Power International
----------------------------------
<PAGE>
Exhibit H-1
GPU PowerNet PTY., Ltd.
Organizational Chart
----------------------------------
GPU Electric, Inc.
(FUCO)
----------------------------------
100%
------------------------
GPU Australia
Holdings, Inc.
---------------- (FUCO)
------------------------
100%
------------------------
Austran Holdings, Inc
------------------------
----------------------------------------------
1% 99% 100% 100%
----------------- ----------------------- ------------------------
GPU PowerNet GPU PowerNet Austran
Pty. Ltd. Investment Pty. Ltd. Investment Pty. Ltd.
(Australia) (Trustee to Trust A) (Trustee to Trust B)
----------------- ----------------------- ------------------------
<PAGE>
Exhibit H-1
GPU Capital, Inc.
EWG Organizational Chart
------------------------
-------------------------------
GPU Capital, Inc.
-------------------------------
100%
-------------------------------
GPU Electric, Inc.
(FUCO)
-------------------------------
100%
-------------------------------
GPU Argentina Holdings, Inc.
(FUCO)
-------------------------------
<PAGE>
Exhibit H-1
GPU Capital, Inc.
FUCO Organizational Chart
-------------------------
-------------------------------
GPU Capital, Inc.
-------------------------------
100%
-------------------------------
GPU Electric, Inc.
(FUCO)
-------------------------------
100%
-------------------------------
GPU Brasil, Inc.
(FUCO)
-------------------------------
----------------
100%
------------------------
GPU Sao Paulo, S.A.
------------------------
-------------------------------
100%
-------------------------------
GPU do Brasil
(FUCO)
-------------------------------
<TABLE> <S> <C>
<PAGE>
<ARTICLE> UT
<CIK> 0000040779
<NAME> GPU, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 6,804,895
<OTHER-PROPERTY-AND-INVEST> 2,299,943
<TOTAL-CURRENT-ASSETS> 1,062,409
<TOTAL-DEFERRED-CHARGES> 6,120,862
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 16,288,109
<COMMON> 331,958
<CAPITAL-SURPLUS-PAID-IN> 1,011,310
<RETAINED-EARNINGS> 2,199,121<F1>
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,464,648<F2>
416,500<F3>
66,478
<LONG-TERM-DEBT-NET> 3,825,584
<SHORT-TERM-NOTES> 368,607
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 561,183
2,500
<CAPITAL-LEASE-OBLIGATIONS> 2,593
<LEASES-CURRENT> 126,480
<OTHER-ITEMS-CAPITAL-AND-LIAB> 7,453,536
<TOT-CAPITALIZATION-AND-LIAB> 16,288,109
<GROSS-OPERATING-REVENUE> 4,248,792
<INCOME-TAX-EXPENSE> 238,241
<OTHER-OPERATING-EXPENSES> 3,352,713
<TOTAL-OPERATING-EXPENSES> 3,590,954
<OPERATING-INCOME-LOSS> 657,838
<OTHER-INCOME-NET> 119,446
<INCOME-BEFORE-INTEREST-EXPEN> 777,284
<TOTAL-INTEREST-EXPENSE> 389,232<F4>
<NET-INCOME> 360,126<F5>
0
<EARNINGS-AVAILABLE-FOR-COMM> 360,126
<COMMON-STOCK-DIVIDENDS> 258,058
<TOTAL-INTEREST-ON-BONDS> 177,483
<CASH-FLOW-OPERATIONS> 797,176
<EPS-PRIMARY> 2.83<F5>
<EPS-DILUTED> 2.83<F5>
<FN>
<F1>INCLUDES ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS) OF ($31,304).
<F2>INCLUDES REACQUIRED COMMON STOCK OF $77,741.
<F3>INCLUDES AMOUNT FOR SUBSIDIARY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $330,000.
<F4>INCLUDES AMOUNT FOR SUBSIDIARY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $28,888 AND PREFERRED STOCK DIVIDENDS OF SUBSIDIARIES OF $11,243.
<F5>INCLUDES MINORITY INTEREST NET (INCOME)/LOSS OF ($2,171) AND AN AFTER-TAX
CHARGE FOR AN EXTRAORDINARY ITEM OF $25,755 ($.20 PER SHARE).
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> UT
<CIK> 0000053456
<NAME> JERSEY CENTRAL POWER & LIGHT COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2,684,782
<OTHER-PROPERTY-AND-INVEST> 548,744
<TOTAL-CURRENT-ASSETS> 390,437
<TOTAL-DEFERRED-CHARGES> 958,159
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 4,582,122
<COMMON> 153,713
<CAPITAL-SURPLUS-PAID-IN> 510,769
<RETAINED-EARNINGS> 892,591<F1>
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,557,073
211,500<F2>
37,741
<LONG-TERM-DEBT-NET> 1,173,532
<SHORT-TERM-NOTES> 53,300
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 69,044
<LONG-TERM-DEBT-CURRENT-PORT> 12
2,500
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 85,366
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,392,054
<TOT-CAPITALIZATION-AND-LIAB> 4,582,122
<GROSS-OPERATING-REVENUE> 2,069,648
<INCOME-TAX-EXPENSE> 164,445
<OTHER-OPERATING-EXPENSES> 1,607,589
<TOTAL-OPERATING-EXPENSES> 1,772,034
<OPERATING-INCOME-LOSS> 297,614
<OTHER-INCOME-NET> 33,380
<INCOME-BEFORE-INTEREST-EXPEN> 330,994
<TOTAL-INTEREST-EXPENSE> 108,552<F3>
<NET-INCOME> 222,442
10,065
<EARNINGS-AVAILABLE-FOR-COMM> 212,377
<COMMON-STOCK-DIVIDENDS> 195,000<F4>
<TOTAL-INTEREST-ON-BONDS> 87,261
<CASH-FLOW-OPERATIONS> 434,873
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>INCLUDES ACCUMULATED OTHER COMPREHENSIVE LOSS OF $425.
<F2>INCLUDES AMOUNT FOR COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $125,000.
<F3>INCLUDES AMOUNT FOR COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $10,700.
<F4>REPRESENTS COMMON STOCK DIVIDENDS PAID TO PARENT CORPORATION.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> UT
<CIK> 0000065350
<NAME> METROPOLITAN EDISON COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,286,388
<OTHER-PROPERTY-AND-INVEST> 222,936
<TOTAL-CURRENT-ASSETS> 207,604
<TOTAL-DEFERRED-CHARGES> 2,348,041
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 4,064,969
<COMMON> 66,273
<CAPITAL-SURPLUS-PAID-IN> 370,200
<RETAINED-EARNINGS> 250,586<F1>
<TOTAL-COMMON-STOCKHOLDERS-EQ> 687,059
100,000<F2>
12,056
<LONG-TERM-DEBT-NET> 546,904
<SHORT-TERM-NOTES> 16,400
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 63,140
<LONG-TERM-DEBT-CURRENT-PORT> 30,024
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 27,135
<OTHER-ITEMS-CAPITAL-AND-LIAB> 2,582,251
<TOT-CAPITALIZATION-AND-LIAB> 4,064,969
<GROSS-OPERATING-REVENUE> 919,594
<INCOME-TAX-EXPENSE> 42,979
<OTHER-OPERATING-EXPENSES> 752,168
<TOTAL-OPERATING-EXPENSES> 795,147
<OPERATING-INCOME-LOSS> 124,447
<OTHER-INCOME-NET> (7,853)
<INCOME-BEFORE-INTEREST-EXPEN> 116,594
<TOTAL-INTEREST-EXPENSE> 58,874<F3>
<NET-INCOME> 50,915<F4>
483
<EARNINGS-AVAILABLE-FOR-COMM> 50,432
<COMMON-STOCK-DIVIDENDS> 85,000<F5>
<TOTAL-INTEREST-ON-BONDS> 42,493
<CASH-FLOW-OPERATIONS> 173,548
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>INCLUDES ACCUMULATED OTHER COMPREHENSIVE INCOME OF $16,520.
<F2>REPRESENTS COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED SECURITIES.
<F3>INCLUDES AMOUNT FOR COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $9,000.
<F4>INCLUDES AN AFTER-TAX CHARGE FOR AN EXTRAORDINARY ITEM OF $6,805.
<F5>REPRESENTS COMMON STOCK DIVIDENDS PAID TO PARENT CORPORATION.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> UT
<CIK> 0000077227
<NAME> PENNSYLVANIA ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,664,862
<OTHER-PROPERTY-AND-INVEST> 90,508
<TOTAL-CURRENT-ASSETS> 243,859
<TOTAL-DEFERRED-CHARGES> 2,525,578
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 4,524,807
<COMMON> 105,812
<CAPITAL-SURPLUS-PAID-IN> 285,486
<RETAINED-EARNINGS> 376,006<F1>
<TOTAL-COMMON-STOCKHOLDERS-EQ> 767,304
105,000<F2>
16,681
<LONG-TERM-DEBT-NET> 626,434
<SHORT-TERM-NOTES> 31,900
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 54,123
<LONG-TERM-DEBT-CURRENT-PORT> 50,012
0
<CAPITAL-LEASE-OBLIGATIONS> 2,593
<LEASES-CURRENT> 13,979
<OTHER-ITEMS-CAPITAL-AND-LIAB> 2,856,781
<TOT-CAPITALIZATION-AND-LIAB> 4,524,807
<GROSS-OPERATING-REVENUE> 1,032,226
<INCOME-TAX-EXPENSE> 45,150
<OTHER-OPERATING-EXPENSES> 861,453
<TOTAL-OPERATING-EXPENSES> 906,603
<OPERATING-INCOME-LOSS> 125,623
<OTHER-INCOME-NET> (3,816)
<INCOME-BEFORE-INTEREST-EXPEN> 121,807
<TOTAL-INTEREST-EXPENSE> 63,217<F3>
<NET-INCOME> 39,640<F4>
695
<EARNINGS-AVAILABLE-FOR-COMM> 38,945
<COMMON-STOCK-DIVIDENDS> 65,000<F5>
<TOTAL-INTEREST-ON-BONDS> 47,729
<CASH-FLOW-OPERATIONS> 192,135
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>INCLUDES ACCUMULATED OTHER COMPREHENSIVE INCOME OF $8,353.
<F2>REPRESENTS COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED SECURITIES.
<F3>INCLUDES AMOUNT FOR COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED
SECURITIES OF $9,188.
<F4>INCLUDES AN AFTER-TAX CHARGE FOR AN EXTRAORDINARY ITEM OF $18,950.
<F5>REPRESENTS COMMON STOCK DIVIDENDS PAID TO PARENT CORPORATION.
</FN>
</TABLE>
