As filed with the Securities and Exchange Commission on
October 12, 1999
Registration No. 333-
------
- ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
--------------------
JERSEY CENTRAL POWER & LIGHT COMPANY
(Exact name of registrant as specified
in its charter)
NEW JERSEY
(State or other jurisdiction of incorporation or organization)
21-0485010
(I.R.S. Employer Identification No.)
2800 Pottsville Pike
Reading, Pennsylvania 19605
(610) 929-3601
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Terrance G. Howson
Vice President and Treasurer
GPU Service, Inc.
310 Madison Avenue
Morristown, New Jersey 07962
(973) 455-8200
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
--------------------
Please send copies of all communications to:
DOUGLAS E. DAVIDSON, ESQ. SCOTT L. GUIBORD, ESQ.
Berlack, Israels & Liberman LLP Secretary
120 West 45th Street Jersey Central Power & Light
New York, New York 10036 Company
(212) 704-0100 2800 Pottsville Pike
Reading, Pennsylvania 19605
(610) 929-3601
RICHARD L. HARDEN, ESQ.
Winthrop, Stimson, Putnam & Roberts
One Battery Park Plaza
New York, New York 10004
(212) 858-1000
<PAGE>
--------------------
Approximate date of commencement of proposed sale to the public: At such
time or times after the effective date of this Registration Statement as the
registrant shall determine based on market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box./ /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering./ /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering./ /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box./ /
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount To Be Maximum Maximum Amount Of
Title of Each Class of Registered Offering Price Aggregate Registration
Securities To Be Per Unit (1) Offering Fee (2)
Registered Price (1)
Senior Notes $300,000,000 100% $300,000,000 $83,400
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457.
(2) Pursuant to Rule 429 of the Securities Act of 1933, the amount of
registration fee includes $27,800 previously paid to the Commission
relating to $100,000,000 aggregate principal amount of senior notes
previously registered pursuant to Registration Statement No. 333-78717,
which remained unissued as of the close of business on October 12, 1999.
- - - - - - - - - -
Pursuant to Rule 429 under the Securities act of 1933, the Prospectus and
Prospectus Supplement included in this Registration Statement will also be
<PAGE>
used in connection with the issuance of senior notes registered pursuant to
Registration Statement No. 333-78717 previously filed by the Registrant on
Form S-3 and declared effective on June 24, 1999.
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SECTION 8(a), MAY DETERMINE
- ------------------------------------------------------------------------------
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
<PAGE>
PROSPECTUS SUPPLEMENT
(To Prospectus dated ------------, 1999)
$300,000,000
Jersey Central Power & Light Company
MEDIUM-TERM NOTES
---------------
Due From One Year to 35 Years From Date of Issue
---------------
Jersey Central Power & Light Company may offer from time to time its medium-term
notes. The specific terms of any notes offered will be included in a pricing
supplement. Unless the pricing supplement provides otherwise, the notes offered
will have the following general terms:
- - The notes will mature from one to - The notes will be held in global
35 years from the date of issue. form by The Depository Trust
- - The notes will bear interest at Company, unless otherwise
either a fixed or a floating rate. specified.
Floating rate interest will be based - The notes may be subject to
on: redemption and repurchase as
- LIBOR specified in this prospectus
- Any other rate specified in the supplement and the accompanying
applicable pricing supplement. prospectus or in the applicable
- - Interest will be paid on the notes pricing supplement.
on the dates specified in the - The notes will be in minimum
applicable pricing supplement. denominations of $1,000,
increased in multiples of $1,000.
The notes will be issued under a Senior Note Indenture between Jersey Central
Power & Light Company and United States Trust Company of New York, as senior
note trustee. Initially, the notes will be secured by one or more series of our
first mortgage bonds which will be issued and delivered to the senior note
trustee under our Indenture dated as of March 1, 1946, as amended and
supplemented. However, on the date that the senior note trustee holds 80% or
more of all of our outstanding first mortgage bonds, the notes will no longer be
secured by any first mortgage bonds. At that time, the notes will be unsecured
obligations of Jersey Central Power & Light Company and will rank equally with
all of our other unsecured and unsubordinated indebtedness.
---------------
Price to Agents' Proceeds to
Public Commissions Company
------ ----------- -------
Per Note 100% .125% - .750% 99.875%-99.250%
Total $300,000,000 $375,000-$2,250,000 $299,625,000-$297,750,000
The Securities and Exchange Commission and state securities regulators have not
approved or disapproved of these securities,
<PAGE>
or determined if this prospectus supplement or the accompanying prospectus is
truthful or complete. Any representation to the contrary is a criminal offense.
Morgan Stanley & Co. Incorporated and J.P. Morgan Securities Inc. will solicit
offers to purchase the notes as agents for Jersey Central Power & Light Company.
The agents have agreed to use their reasonable efforts to sell the notes.
---------------
MORGAN STANLEY DEAN WITTER J.P. MORGAN & CO.
- ----------------, 1999
<PAGE>
You should read and rely only on the information incorporated by reference or
provided in this prospectus supplement or the accompanying prospectus. We have
not authorized anyone else to provide you with different information. Neither we
nor the Agents are making an offer of these securities in any state where the
offer is not permitted. You should not assume that the information in this
prospectus supplement or the accompanying prospectus, or incorporated by
reference, is accurate as of any date other than the date such information is
given.
Table of Contents
Prospectus Supplement
Page
Introductory Statement .............................................S-2
Jersey Central Power & Light Company ...............................S-2
Use of Proceeds ....................................................S-2
Description of the Notes ...........................................S-2
Plan of Distribution ...............................................S-10
Prospectus
About This Prospectus .............................................. 3
Jersey Central Power & Light Company ............................... 3
Where You Can Find More Information ................................ 4
Use of Proceeds .................................................... 5
Ratios of Earnings to Fixed Charges ................................ 5
Description of Senior Notes ........................................ 5
Description of Senior Note Mortgage Bonds........................... 24
Plan of Distribution ............................................... 29
Legal Matters ...................................................... 31
Experts ............................................................ 31
<PAGE>
INTRODUCTORY STATEMENT
Jersey Central Power & Light Company (the "Company") is offering medium
term notes (the "Notes"), in the principal amount of $300,000,000. If the
Company sells other Senior Notes as described in the accompanying prospectus,
the aggregate principal amount of Notes that the Company may offer and sell
under this prospectus supplement would be reduced.
The Company intends to use this prospectus supplement, the accompanying
prospectus and a related pricing supplement to offer the Notes from time to
time. This prospectus supplement provides you with certain terms of the Notes
and supplements the description of Senior Notes contained in the accompanying
prospectus. If any information in this prospectus supplement is inconsistent
with the prospectus, this prospectus supplement replaces the inconsistent
information. Each time the Company issues Notes, it will prepare a pricing
supplement that will contain additional terms of the offering and the
description of the specific Notes offered. The pricing supplement also may add,
update or change information in this prospectus supplement or the accompanying
prospectus, including provisions describing the calculation of interest and the
method of making payments under the terms of a Note. Any information in the
pricing supplement that is inconsistent with this prospectus supplement or the
accompanying prospectus will replace the inconsistent information in this
prospectus supplement or the accompanying prospectus.
JERSEY CENTRAL POWER & LIGHT COMPANY
The Company, a public utility furnishing electric service within New
Jersey, is a wholly owned subsidiary of GPU, Inc., a holding company registered
under the Public Utility Holding Company Act of 1935. The Company, which does
business under the name "GPU Energy", provides electric service within a
territory located in northern, western and east central New Jersey having a
population of about 2.6 million. The Company's principal executive offices are
located at 2800 Pottsville Pike, Reading, Pennsylvania 19605, and its telephone
number is (610) 929-3601.
USE OF PROCEEDS
The Company will use the net proceeds from the sale of the Notes (1) to
redeem or repurchase other outstanding securities of the Company, (2) to reduce
the Company's short-term borrowings, (3) for construction purposes and (4) for
other corporate purposes, including to reimburse the Company's treasury for
funds previously expended for the purposes described above.
DESCRIPTION OF THE NOTES
The following is a summary of certain terms of the Notes, does not
purport to be complete, and is subject to, and qualified in its
S-2
<PAGE>
entirety by, the description of Senior Notes in the accompanying prospectus, the
form of the Senior Note Indenture (as defined below), which is on file with the
Securities and Exchange Commission, and the Trust Indenture Act of 1939. Certain
capitalized terms used in this prospectus supplement are defined in the Senior
Note Indenture. The following description of certain terms of the Notes
supplements and, to the extent inconsistent therewith, replaces the description
of the general terms and provisions of the Senior Notes set forth in the
accompanying prospectus, to which reference is hereby made. The following
description will apply unless otherwise specified in an applicable pricing
supplement.
General
Each series of the Notes will be issued as a series of Senior Notes under
the Senior Note Indenture, as it may be amended or supplemented from time to
time (the "Senior Note Indenture") between the Company and United States Trust
Company of New York (the "Senior Note Trustee"). Until the Release Date (as
defined below), all of the Senior Notes, including the Notes, outstanding under
the Senior Note Indenture will be secured by one or more series of the Company's
Senior Note Mortgage Bonds issued and delivered by the Company to the Senior
Note Trustee. The Senior Note Mortgage Bonds are first mortgage bonds ("First
Mortgage Bonds") to be issued under and secured by the Company's Indenture dated
as of March 1, 1946 (the "Mortgage") between the Company and United States Trust
Company of New York, as successor trustee, as heretofore amended and
supplemented. See "Description of Senior Notes -- Security; Release Date" in the
accompanying prospectus. The Release Date is the earlier of (1) the date that
all First Mortgage Bonds, other than the Senior Note Mortgage Bonds, have been
retired (whether at, before or after the maturity thereof) through payment,
redemption, purchase, defeasance or otherwise and (2) the date upon which the
Senior Note Trustee holds Senior Note Mortgage Bonds constituting 80% or more of
all of our outstanding First Mortgage Bonds. On the Release Date, the Senior
Note Trustee will surrender the Senior Note Mortgage Bonds for cancellation and
the Notes will cease to be secured by the Senior Note Mortgage Bonds, will
become unsecured general obligations of the Company and will rank on a parity
with other unsecured and unsubordinated indebtedness of the Company. As of the
date of this prospectus supplement, approximately $1,174 million of First
Mortgage Bonds remain outstanding, none of which are Senior Note Mortgage Bonds.
The Senior Note Indenture provides that prior to the Release Date, the principal
amount of Senior Notes (including the Notes) that may be issued and outstanding
cannot exceed the principal amount of the Senior Note Mortgage Bonds then held
by the Senior Note Trustee. After the issuance of the first series of the Senior
Notes, no additional First Mortgage Bonds will be issued under the Mortgage
other than as collateral security for the Senior Notes. See "Description of
Senior Note Mortgage Bonds" in the accompanying prospectus.
S-3
<PAGE>
For further information concerning the Notes, see "Description of Senior
Notes" in the accompanying prospectus.
The Notes will be offered on a continuous basis and will mature on any
Business Day (as defined below) from one year to 35 years from the date of
issue, as selected by the purchaser and agreed to by the Company. Prior to
maturity, the Notes may be subject to optional redemption by the Company as set
forth under "Interest and Interest Rates -- Fixed Rate Notes" below and under
"Description of Senior Notes -- Redemption Provisions" in the accompanying
prospectus, or as set forth in the applicable pricing supplement. Each Note will
bear interest at a fixed or floating rate as specified in the applicable pricing
supplement.
The pricing supplement relating to each Note will describe the following
terms: (1) the title of such Notes; (2) the aggregate principal amount of such
Notes; (3) the date on which such Notes will be issued (the "Original Issue
Date"); (4) the price (expressed as a percentage of principal amount) at which
such Notes will be issued; (5) the date or dates on which the principal of such
Notes is payable; (6) the rate or rates at which such Notes will bear interest
(or the basis or formula with reference to which such rate or rates will be
determined), the date or dates from which such interest will accrue, the dates
on which such interest will be payable ("Interest Payment Dates"), and the
regular record dates for the interest payable on such Interest Payment Dates;
(7) the option, if any, of the Company to redeem such Notes and the period or
periods within which, or the date or dates on which, the prices at which and the
terms and conditions upon which, such Notes may be redeemed, in whole or in
part, upon the exercise of such option; (8) the obligation, if any, of the
Company to redeem or purchase such Notes at the option of the registered holder
or pursuant to any sinking fund or analogous provisions and the period or
periods within which, or the date or dates on which, the price or prices at
which and the terms and conditions upon which, such Notes will be redeemed or
purchased, in whole or in part, pursuant to such obligation; (9) the
denominations in which such Notes will be issuable, if other than $1,000 and
integral multiples thereof; and (10) any other terms of such Notes, including
with respect to any series, if applicable.
With respect to Notes for which interest is based on the LIBOR index,
"Business Day" shall mean a Business Day as defined in the accompanying
prospectus that is also a London Business Day. "London Business Day" means a day
on which commercial banks are open for business (including dealings in United
States dollars) in London. Unless the Company otherwise specifies in the
applicable pricing supplement, the "regular record date" with respect to any
Interest Payment Date will be the fifteenth day of the calendar month
immediately preceding such Interest Payment Date (whether or not a Business
Day). See "Description of Senior Notes -- Payment of Principal and Interest" in
the accompanying prospectus.
S-4
<PAGE>
Except under certain circumstances, the Company will issue the Notes in
book-entry form only. See "Description of Senior Notes -- Book-Entry Senior
Notes" in the accompanying prospectus.
Interest and Interest Rates
General
In the related pricing supplement, the Company will designate each Note as
a Fixed Rate Note or a Floating Rate Note and describe the method of determining
the interest rate, including any Spread and/or Spread Multiplier. The Company
may also specify a maximum and a minimum interest rate in the related pricing
supplement.
Interest rates on the Notes that the Company offers may differ depending
upon, among other things, the aggregate principal amount of Notes purchased in
any single transaction. The Company may offer Notes with similar variable terms
but different interest rates, as well as Notes with different variable terms
concurrently to different investors. The Company may, from time to time, change
the interest rates or formulas and other terms of Notes, but no such change will
affect any Note already issued or as to which an offer to purchase has been
accepted.
Fixed Rate Notes
In the pricing supplement for Fixed Rate Notes, the Company will specify a
fixed interest rate payable per annum in arrears on the Interest Payment Dates.
The Interest Payment Dates for Fixed Rate Notes will be August 1 and February 1
of each year or on such other date(s) specified in the applicable pricing
supplement. Interest on Fixed Rate Notes will be computed on the basis of a
360-day year of twelve 30-day months. If the maturity date or an Interest
Payment Date for any Fixed Rate Note is not a Business Day, the Company will pay
principal, any premium, and any interest for that Note on the next Business Day
with the same force and effect as if made on such date, and no interest will
accrue from and after the maturity date or Interest Payment Date.
Unless the Company otherwise specifies in the applicable pricing
supplement, the Fixed Rate Notes may be redeemable as set forth under
"Description of Senior Notes -- Redemption Provisions" in the accompanying
prospectus. For purposes of such discussion in the accompanying prospectus,
"Reference Treasury Dealer" means each of Morgan Stanley & Co. Incorporated and
J.P. Morgan Securities Inc. and their respective successors. If either of the
foregoing shall cease to be a primary U.S. Government securities dealer (a
"Primary Treasury Dealer"), the Company shall substitute another nationally
recognized investment banking firm that is a Primary Treasury Dealer.
S-5
<PAGE>
Floating Rate Notes
Unless otherwise specified in a pricing supplement, each Floating Rate
Note will have an interest rate basis or formula based on LIBOR.
In the pricing supplement, the Company will indicate the Index Maturity as
well as any Spread and/or Spread Multiplier which would be applied to the
interest rate formula to determine the interest rate. Any Floating Rate Note may
have a maximum or minimum interest rate limitation. In addition to any maximum
interest rate limitation, the interest rate on the Floating Rate Notes will in
no event be higher than the maximum rate permitted by New York law, as the same
may be modified by United States law of general application.
The "Spread" is the number of basis points (one one-hundredth of a
percentage point) to be added to or subtracted from the related basis or bases
applicable to such Floating Rate Note. The "Spread Multiplier" is the percentage
of the related basis or bases applicable to such Floating Rate Note and by which
such basis or bases will be multiplied to determine the applicable interest rate
on such Floating Rate Note. The "Index Maturity" is the period to maturity of
the instrument or obligation with respect to which the related basis or bases
will be calculated.
The Company will appoint a calculation agent to calculate interest rates
on the Floating Rate Notes. Unless the Company identifies a different party in
the pricing supplement, the paying agent appointed by the Company (initially,
United States Trust Company of New York) will be the calculation agent for each
Note. Each Floating Rate Note will have a specified "Interest Reset Date",
"Interest Determination Date" and, where applicable, "Calculation Date"
associated with it. An "Interest Reset Date" is the date on which the interest
rate on the Note is subject to change and, unless otherwise specified in a
pricing supplement, will be the second London Business Day immediately following
the applicable Interest Determination Date. An "Interest Determination Date" is
the date as of which the new interest rate is determined for a particular
Interest Reset Date, based on the applicable interest rate basis or formula as
of that Interest Determination Date. The "Calculation Date" is the date by which
the calculation agent will determine the new interest rate that became effective
on a particular Interest Reset Date based on the applicable interest rate basis
or formula on the Interest Determination Date. The interest rate determined by
the calculation agent, absent manifest error, shall be binding and conclusive
upon beneficial owners and holders of Floating Rate Notes and on the Company.
Promptly on such determination, the calculation agent will notify the Senior
Note Trustee and the paying agent (if the calculation agent is not the paying
agent) of the new interest rate.
S-6
<PAGE>
Change Of Interest Rate. The Company may reset the interest rate on each
Floating Rate Note daily, weekly, monthly, quarterly, semi-annually, annually or
on some other basis that the Company specifies. The Interest Reset Date will be
specified in the pricing supplement.
The related pricing supplement will describe the initial interest rate or
interest rate formula on each Note. That rate is effective until the following
Interest Reset Date. Thereafter, the interest rate will be the rate determined
on each Interest Determination Date. Each time a new interest rate is
determined, it becomes effective on the subsequent Interest Reset Date. Unless
otherwise specified in a pricing supplement, if any Interest Reset Date is not a
Business Day, then the Interest Reset Date will be postponed to the next
Business Day, except if the next Business Day is in the next calendar month, the
Interest Reset Date will be the immediately preceding Business Day.
Date Interest Rate Is Determined. Unless otherwise specified in a pricing
supplement, the Interest Determination Date will be the second London Business
Day immediately preceding the applicable Interest Reset Date.
Calculation Date. Unless the Company specifies a different date in a
pricing supplement, the "Calculation Date", where applicable, relating to an
Interest Determination Date will be the earlier of
(1) the tenth calendar day after such Interest Determination Date or, if
such day is not a Business Day, the next succeeding Business Day, or
(2) the Business Day immediately preceding the relevant Interest Payment
Date or the maturity date, as the case may be.
Upon the request of the beneficial holder of any Floating Rate Note, the
calculation agent will provide the interest rate then in effect and, if
different, the interest rate that will become effective on the next Interest
Reset Date for the Floating Rate Note.
Payment Of Interest. The Company will pay installments of interest on
Floating Rate Notes on the Interest Payment Dates specified in the applicable
pricing supplement.
The Company will also pay interest at maturity, redemption or repurchase.
If an Interest Payment Date is not a Business Day, such Interest Payment
Date will be postponed to the next succeeding Business Day, except that in the
case of a Floating Rate Note as to which LIBOR is the applicable interest rate
basis and such Business Day falls in the next succeeding calendar month, such
S-7
<PAGE>
Interest Payment Date will be the immediately preceding Business Day. If the
maturity date, date of redemption or repurchase of any Floating Rate Note is not
a Business Day, principal, premium, if any, and interest for that Note will be
paid on the next Business Day, and no interest will accrue from and after the
maturity date, date of redemption or repurchase.
The Company will calculate accrued interest on a Floating Rate Note by
multiplying the principal amount of a Note by an accrued interest factor. The
accrued interest factor is the sum of the interest factors calculated for each
day in the period for which accrued interest is being calculated. The interest
factor for each day is computed by dividing the interest rate in effect on that
day by 360. All percentages resulting from any calculation are rounded to the
nearest one hundredth of a percentage point, with five one-thousandths of a
percentage point rounded upward. For example, 9.875% (or .09875) will be rounded
to 9.88% (or .0988). Dollar amounts used in the calculation are rounded to the
nearest cent (with one-half cent being rounded upward).
Calculation Of Interest
On each Interest Determination Date, the calculation agent will
determine LIBOR as follows:
- If the pricing supplement specifies "LIBOR Telerate", LIBOR on any
Interest Determination Date will be the rate for deposits in United
States dollars having the Index Maturity described in the related
pricing supplement on the applicable Interest Reset Date, as such
rate appears on the Designated LIBOR Page as of 11:00 A.M., London
time, on that Interest Determination Date.
- If the pricing supplement specifies "LIBOR Reuters", LIBOR on any
Interest Determination Date will be the arithmetic mean of the
offered rates (unless the Designated LIBOR Page by its terms
provides only for a single rate, in which case such single rate
shall be used) for deposits in United States dollars having the
Index Maturity described in the related pricing supplement on the
applicable Interest Reset Date, as such rates appear on the
Designated LIBOR Page as of 11:00 A.M., London time, on that
Interest Determination Date, if at least two such offered rates
appear (unless, as aforesaid, only a single rate is required) on the
Designated LIBOR Page.
- If the pricing supplement does not specify "LIBOR Telerate" or
"LIBOR Reuters", the LIBOR Rate will be LIBOR Telerate. In addition,
if the Designated LIBOR Page by its terms provides only for a single
rate, that
S-8
<PAGE>
single rate will be used regardless of the foregoing provisions
requiring more than one rate.
On any Interest Determination Date on which fewer than the required
number of applicable rates appear or no rate appears on the applicable
Designated LIBOR Page, the calculation agent will determine LIBOR as follows:
- LIBOR will be determined on the basis of the offered rates at
which deposits in United States dollars having the Index Maturity
described in the related pricing supplement on the Interest
Determination Date and in a principal amount that is representative
of a single transaction in that market at that time are offered by
four major banks in the London interbank market at approximately
11:00 A.M., London time, on the Interest Determination Date to prime
banks in the London interbank market. The calculation agent will
select the four banks and request the principal London office of
each of those banks to provide a quotation of its rate for deposits
in United States dollars. If at least two quotations are provided,
LIBOR for that Interest Determination Date will be the average of
those quotations.
- If fewer than two quotations are provided as mentioned above,
LIBOR will be the average of the rates quoted by three major banks
in The City of New York selected by the calculation agent at
approximately 11:00 A.M. in The City of New York, on the Interest
Determination Date for loans to leading European banks in United
States dollars having the Index Maturity designated in the pricing
supplement and in a principal amount that is representative for a
single transaction in United States dollars in that market at that
time. The calculation agent will select the three banks referred to
above.
- If fewer than three banks selected by the calculation agent are
quoting as mentioned above, LIBOR will remain LIBOR then in effect
on that Interest Determination Date.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is designated
in the applicable pricing supplement, the display on the Reuters Monitor Money
Rates Service for the purpose of displaying the London interbank rates of major
banks for United States dollars, or (b) if "LIBOR Telerate" is designated in the
applicable pricing supplement, the display on the Dow Jones Telerate Service for
the purpose of displaying the London interbank rates of major banks for United
States dollars. If neither LIBOR Reuters nor LIBOR Telerate is specified in the
applicable pricing supplement, LIBOR will be determined as if LIBOR Telerate had
been specified. For United States dollars,
S-9
<PAGE>
LIBOR will be determined as if Page 3750 had been specified. "Page 3750" means
the display designated as page "3750" on the Bridge Telerate, Inc. (or such
other page as may replace the 3750 page on that service or such other service or
services as may be nominated by the British Bankers' Association for the
purposes of displaying London interbank offered rates for United States dollar
deposits).
Issuance of Additional First Mortgage Bonds
The Senior Note Mortgage Bonds will be issued under the Mortgage against
property additions and/or previously retired First Mortgage Bonds. At June 30,
1999, the Company had available property additions sufficient to permit it to
issue a maximum of approximately $361 million aggregate principal amount of
additional Senior Note Mortgage Bonds. In addition, the Company could issue
approximately $361 million aggregate principal amount of Senior Note Mortgage
Bonds on the basis of previously retired First Mortgage Bonds. See "Description
of Senior Note Mortgage Bonds -- Issuance of Additional First Mortgage Bonds" in
the accompanying prospectus.
At June 30, 1999, the Company had approximately $839 million of retained
earnings available for the declaration of payment of dividends on the Company's
common stock pursuant to the restrictions contained in the Mortgage, as
described under "Description of Senior Note Mortgage Bonds -- Dividend
Restrictions" in the accompanying prospectus.
PLAN OF DISTRIBUTION
Subject to the terms and conditions set forth in the Distribution
Agreement between the Company and the Agents, the Notes are being offered on a
continuous basis by the Company through Morgan Stanley & Co. Incorporated and
J.P. Morgan Securities Inc. (individually, an "Agent" and collectively, the
"Agents"), who have agreed to use reasonable efforts to solicit offers to
purchase Notes. The Company will have the sole right to accept offers to
purchase Notes and may reject any offer to purchase Notes in whole or in part.
An Agent will have the right to reject any offer to purchase Notes solicited by
it in whole or in part. Payment of the purchase price of the Notes will be
required to be made in immediately available funds. The company will pay an
Agent, in connection with sales of Notes resulting from a solicitation made or
an order to purchase received by such Agent, a commission ranging from .125% to
.750% of the principal amount of Notes to be sold; provided, however, that
commissions with respect to Notes maturing more than thirty years from the date
of issue will be negotiated.
The Company may sell Notes directly to investors. In this case, no
underwriters or agents would be involved. No commission will be payable on Notes
the Company sells directly to investors.
S-10
<PAGE>
The Company may accept offers to purchase Notes through other agents and
may appoint additional agents for the purpose of soliciting offers to purchase
Notes, in either case on terms substantially identical to the terms contained in
the Distribution Agreement with the Agents. Any other additional agents will be
named in the applicable pricing supplement.
If the Company sells Notes to an Agent as principal, it will purchase the
Notes for its own account at a discount to be agreed upon by the Company and the
Agent at the time of sale. Unless otherwise stated in the applicable pricing
supplement, the discount will be within the range of .125% to .750% of the
principal amount per Note. The Agents may resell the Notes in one or more
transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. In addition, the
Agents may offer Notes they have acquired as principal to other dealers. The
Agents may sell Notes to any dealer at a discount and that discount will not be
in excess of the discount received by the Agent from the Company, unless
specified in the applicable pricing supplement. The obligations of the Agents to
purchase the Notes as principal will be subject to certain conditions. After the
initial public offering of Notes to be resold to investors and other purchasers,
the public offering price and any discounts or concessions allowed or re-allowed
or paid to dealers may be changed from time to time.
The Agents may engage in transactions that stabilize, maintain or
otherwise affect the price of the Notes. Specifically, the Agents may overallot
in connection with the offering, creating a short position in the Notes for
their own account. In addition, to cover overallotments or to stabilize the
price of the Notes, the Agents may bid for, and purchase, the Notes, in the open
market. Finally, the Agents may reclaim selling concessions allowed to any agent
or a dealer for distributing the Notes in the offering, if the Agents repurchase
previously distributed Notes in transactions to cover syndicate short positions,
in stabilization.
Underwriters, dealers and agents that participate in the distribution of
the Notes may be underwriters as defined in the Securities Act of 1933, as
amended (the "Act"), and any discounts or commissions received by them from the
Company and any profit on the resale of the Notes by them may be treated as
underwriting discounts and commissions under the Act. The Company has agreements
with the Agents to indemnify them against certain civil liabilities, including
liabilities under the Act, or to contribute with respect to payments which the
Agents may be required to make. The Agents may engage in transactions with, or
perform services for, the Company or its affiliates in the ordinary course of
their business.
The Company does not intend to apply for listing of the Notes on a
national securities exchange. The Agents have advised the Company that they
intend to make a market in the Notes, as permitted by applicable laws and
regulations. However, the Agents
S-11
<PAGE>
are not obligated to do so and may discontinue making a market at any time.
The Company cannot assure you as to the liquidity of the trading market for
the Notes.
S-12
<PAGE>
SUBJECT TO COMPLETION, DATED ---------- --, 1999
PROSPECTUS
$300,000,000
JERSEY CENTRAL POWER & LIGHT COMPANY
SENIOR NOTES
--------------------
Jersey Central Power & Light Company will be selling Senior Notes from
time to time in an amount not to exceed $300,000,000 pursuant to this prospectus
and supplements to this prospectus.
Each series of Senior Notes will be issued under a Senior Note Indenture
between us and United States Trust Company of New York, as senior note trustee.
Initially, the Senior Notes will be secured by one or more series of our First
Mortgage Bonds which will be issued and delivered to the senior note trustee
under our First Mortgage Bond Indenture dated as of March 1, 1946, as amended
and supplemented. However, on the date that the senior note trustee holds 80% or
more of all of our outstanding First Mortgage Bonds, the Senior Notes will no
longer be secured by any First Mortgage Bonds. At that time, the Senior Notes
will be unsecured obligations of Jersey Central Power & Light Company and will
rank equally with all of our other unsecured and unsubordinated indebtedness.
We will provide the specific terms of each series of Senior Notes, their
offering prices and how they will be offered in supplements to this prospectus.
You should read this prospectus and any applicable supplement carefully before
you invest.
Our principal executive offices are located at 2800 Pottsville Pike,
Reading, Pennsylvania 19605 and our telephone number is (610) 929-3601.
--------------------
These securities have not been approved or disapproved by the Securities and
Exchange Commission or any state securities commission, nor have these
organizations determined that this prospectus is accurate or complete. Any
representation to the contrary is a criminal offense.
--------------------
---------- --, 1999
<PAGE>
You should read and rely only on the information incorporated by reference
or provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. Neither we nor any underwriters,
agents or dealers are making an offer of these securities in any state where the
offer is not permitted. You should not assume that the information in this
prospectus or any supplement, or incorporated by reference, is accurate as of
any date other than the date such information is given.
--------------------
TABLE OF CONTENTS PAGE
About This Prospectus..........................3
Jersey Central Power & Light Company...........3
Where You Can Find More Information............4
Use of Proceeds................................5
Ratios of Earnings to Fixed Charges............5
Description of Senior Notes....................5
Description of Senior Note
Mortgage Bonds................................24
Plan of Distribution .........................29
Legal Matters.................................31
Experts.......................................31
2
<PAGE>
ABOUT THIS PROSPECTUS
......This prospectus is part of registration statements that we filed with the
Securities and Exchange Commission using a "shelf" registration process. Under
this shelf process, we may, from time to time, sell the Senior Notes described
in this prospectus in one or more offerings up to a total dollar amount of
$300,000,000. This prospectus provides you with a general description of the
Senior Notes. Each time we sell a series of Senior Notes, we will provide you
with a supplement to this prospectus that will contain specific information
about the terms of that series. Any supplement may also add, update or change
information contained in this prospectus. Before you invest, you should read
both this prospectus and any supplement to this prospectus together with the
additional information about us described under "Where You Can Find More
Information."
......For more detailed information about the Senior Notes, you can read the
exhibits filed with the registration statement.
JERSEY CENTRAL POWER & LIGHT COMPANY
......Jersey Central Power & Light Company (the "Company"), a public utility
furnishing electric service wholly within the State of New Jersey, is a
subsidiary of GPU, Inc., a holding company registered under the Public Utility
Holding Company Act of 1935. The Company provides retail electric service within
a territory located in northern, western and east central New Jersey having a
population of approximately 2.6 million. The Company's principal executive
offices are located at 2800 Pottsville Pike, Reading, Pennsylvania 19605, and
its telephone number is (610) 929-3601.
......During 1998, residential sales accounted for about 45% of the Company's
operating revenues from customers and 41% of kilowatt-hour sales to customers;
commercial sales accounted for about 39% of the Company's operating revenues
from customers and 40% of kilowatt-hour sales to customers; industrial sales
accounted for about 15% of the Company's operating revenues from customers and
19% of kilowatt-hour sales to customers; and sales to rural electric
cooperatives, municipalities (primarily for street and highway lighting) and
others accounted for about 1% of the Company's operating revenues from customers
and less than 1% of kilowatt-hour sales to customers. The revenues derived from
the 25 largest customers in the aggregate accounted for approximately 9% of
operating revenues from customers for the year 1998. The Company also makes
interchange and spot market sales of electricity to other utilities.
......The electric generating and transmission facilities of the Company and its
affiliates, Pennsylvania Electric Company and Metropolitan Edison Company
(collectively doing business as "GPU Energy"), are physically interconnected and
are operated as a single integrated and coordinated system. The transmission
3
<PAGE>
facilities of the integrated system are physically interconnected with
neighboring nonaffiliated utilities in Pennsylvania, New Jersey, Maryland, New
York and Ohio. The Company is a member of the Pennsylvania-New Jersey-Maryland
Interconnection ("PJM") and the Mid-Atlantic Council, an organization providing
coordinated review of the planning by utilities in the PJM area. The
interconnection facilities are used for substantial capacity and energy
interchange and purchased power transactions as well as emergency assistance.
WHERE YOU CAN FIND MORE INFORMATION
......The Company, a New Jersey corporation, files annual, quarterly and current
reports and other information with the Securities and Exchange Commission under
File No. 1-3141. These Securities and Exchange Commission filings are available
to the public over the Internet at the Securities and Exchange Commission's web
site at http://www.sec.gov. You may also read and copy any of these Securities
and Exchange Commission filings at the Securities and Exchange Commission's
public reference room in Washington, D.C. located at 450 Fifth Street, N.W.
Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further
information about the operation of the public reference room. Some of our
securities are listed on the New York Stock Exchange and such reports and other
information can also be inspected and copied at the offices of such exchange on
the 7th Floor, 20 Broad Street, New York, New York.
......The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is an important part of this prospectus
and should be read with the same care. Information that we file later with the
Securities and Exchange Commission will automatically update and supersede this
information. We incorporate by reference the documents listed below and any
future filings (including those made after the initial filing of the
registration statement and prior to effectiveness) we make with the Securities
and Exchange Commission under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until we sell all of the Senior Notes described
in this prospectus.
- - Our Annual Report on Form 10-K for the year ended December 31, 1998.
- - Our Quarterly Reports on Form 10-Q for the quarters ended March 31 and June
30, 1999.
- - Our Current Reports on Form 8-K dated April 16, May 26, August 5 and
September 15, 1999.
You may request a free copy of these filings by writing or telephoning
us at the following address: Jersey Central Power & Light Company, 2800
Pottsville Pike, Reading, Pennsylvania
4
<PAGE>
19605, attention: Secretary. Our telephone number is (610) 929-3601.
USE OF PROCEEDS
Except as shall otherwise be provided in a supplement to this prospectus,
the Company intends to use the net proceeds from the sale of the Senior Notes
offered from time to time:
- - to redeem other outstanding securities of the Company, including first
mortgage bonds, preferred stock and preferred securities,
- - to repay outstanding short-term bank loans or other unsecured
indebtedness,
- - for construction purposes and
- - for other corporate purposes, including to reimburse the Company's treasury
for funds previously expended for the above purposes.
The use of proceeds with respect to a particular series of Senior Notes will be
set forth in the related supplement to this prospectus.
RATIOS OF EARNINGS TO FIXED CHARGES
The Company's Ratio of Earnings to Fixed Charges for each of the periods
indicated was as follows:
Years ended December 31, Twelve Months
ended
June 30, 1999
1994 1995 1996 1997 1998 (unaudited)
- ---- ---- ---- ---- ---- ---------------
3.09 3.44 2.89 3.57 4.01 3.37
The Ratio of Earnings to Fixed Charges represents, on a pre-tax basis, the
number of times earnings cover fixed charges. Earnings consist of net income to
which has been added fixed charges and taxes based on income of the Company.
Fixed charges consist of interest on funded indebtedness, other interest
(including distributions on Company Obligated Mandatorily Redeemable Preferred
Securities), amortization of net gain on reacquired debt and net discount on
debt and the interest portion of all rentals charged to income.
DESCRIPTION OF SENIOR NOTES
The following is a summary of certain terms and provisions of the Senior
Notes and the Senior Note Indenture (as defined below). Reference is made to the
Senior Note Indenture which is an exhibit to the registration statement of which
this prospectus forms a part.
5
<PAGE>
General
The Senior Notes may be issued from time to time in one or more series in
amounts and on terms to be determined at or prior to the time or times of sale,
under the Senior Note Indenture, as it may be amended or supplemented (the
"Senior Note Indenture"), between the Company and United States Trust Company of
New York (the "Senior Note Trustee").
Until the Release Date (as defined below), all of the Senior Notes
outstanding under the Senior Note Indenture will be secured by one or more
series of the Company's Senior Note Mortgage Bonds (as defined below) issued and
delivered by the Company to the Senior Note Trustee. See "-- Security; Release
Date." On the Release Date, the Senior Notes will cease to be secured by the
Senior Note Mortgage Bonds, will become unsecured general obligations of the
Company and will rank on a parity with other unsecured and unsubordinated
indebtedness of the Company. The Senior Note Indenture provides that prior to
the Release Date, the principal amount of the Senior Notes that may be issued
and outstanding cannot exceed the principal amount of the Senior Note Mortgage
Bonds then held by the Senior Note Trustee. See "Description of Senior Note
Mortgage Bonds -- Issuance of Additional First Mortgage Bonds."
There is no requirement under the Senior Note Indenture that future issues
of debt securities of the Company be issued exclusively under the Senior Note
Indenture; accordingly, the Company will be free to employ other indentures or
documentation, containing provisions different from those included in the Senior
Note Indenture or applicable to one or more issues of Senior Notes, in
connection with future issues of other debt securities.
There is no limitation on the amount of Senior Notes that may be issued
under the Senior Note Indenture. However, the Senior Note Indenture contains
certain restrictive covenants prohibiting the Company from (1) issuing,
assuming, guaranteeing or permitting to exist after the Release Date, so long as
any Senior Notes are outstanding, any secured debt without effectively securing
the Senior Notes equally and ratably with such secured debt, or (2) entering
into or permitting to exist certain sale/leaseback transactions, subject, in
each case, to certain exceptions described under "-- Certain Covenants of the
Company."
There is no provision in the Senior Note Indenture or the Senior Notes
that requires the Company to redeem, or permit the holders to cause a redemption
of, the Senior Notes or that otherwise protects the holders in the event that
the Company incurs substantial additional indebtedness, whether or not in
connection with a change in control of the Company.
Reference is made to a supplement to this prospectus for a description
of the following terms of the series of Senior Notes
6
<PAGE>
in respect of which this prospectus is being delivered, to the extent such terms
supplement or differ from the description of the Senior Notes contained in this
prospectus: (1) the designation of such Senior Notes; (2) the aggregate
principal amount of such Senior Notes; (3) the price (expressed as a percentage
of principal amount) at which such Senior Notes will be issued; (4) the date or
dates on which the principal of such Senior Notes is payable; (5) the rate or
rates at which such Senior Notes will bear interest, or method of calculation of
such rate or rates, the date or dates from which such interest will accrue, the
dates on which such interest will be payable ("Interest Payment Dates"), and the
regular record dates for the interest payable on such Interest Payment Dates
("Regular Record Dates"); (6) the option, if any, of the Company to redeem such
Senior Notes and the period or periods within which, or the date or dates on
which, the prices at which and the terms and conditions upon which, such Senior
Notes may be redeemed, in whole or in part, upon the exercise of such option;
(7) the obligation, if any, of the Company to redeem or purchase such Senior
Notes at the option of the registered holder or pursuant to any sinking fund or
analogous provisions and the period or periods within which, or the date or
dates on which, the price or prices at which and the terms and conditions upon
which, such Senior Notes will be redeemed or purchased, in whole or in part,
pursuant to such obligation; (8) if prior to the Release Date, the designation
of the related series of Senior Note Mortgage Bonds being delivered to the
Senior Note Trustee in connection with the issuance of such Senior Notes; and
(9) any other terms of such Senior Notes not inconsistent with the Senior Note
Indenture.
Unless otherwise indicated in a supplement to this prospectus, the Senior
Notes will be issued (1) in denominations of $1,000 and integral multiples
thereof, and (2) in book-entry only form and represented by one or more Global
Securities, as described under "-- Book-Entry Senior Notes."
Payment of Principal and Interest
Until the Senior Notes are paid or payment thereof is provided for, the
Company will, at all times, maintain a paying agent (the "Paying Agent") in The
City of New York capable of performing the duties described herein to be
performed by the Paying Agent. The Company has initially appointed United States
Trust Company of New York, 114 West 47th Street, New York, New York 10036 as
Paying Agent. Any change in the Paying Agent or its address effected prior to
the issuance of any series of Senior Notes will be set forth in a supplement to
this prospectus. Thereafter, the Company will notify the holders of the Senior
Notes in accordance with the Senior Note Indenture of any change in the Paying
Agent or its address.
Each series of Senior Notes will bear interest from the later of (1) the
date such series is issued and authenticated (the
7
<PAGE>
"Original Issue Date") or the date specified in such series or (2) the most
recent date to which interest has been paid or duly provided for with respect to
such series, in each case at the rate set forth in a supplement to this
prospectus, until the principal amount thereof is paid or made available for
payment. Interest on each series of Senior Notes will be payable on such
Interest Payment Dates as are set forth in a supplement to this prospectus and
at maturity or upon earlier redemption; provided, however, that the first
Interest Payment Date for any series of Senior Notes with an Original Issue Date
between a Regular Record Date set forth in a supplement to this prospectus and
an Interest Payment Date will be the Interest Payment Date following the next
Regular Record Date. Each payment of interest in respect of an Interest Payment
Date will include interest accrued to but excluding such Interest Payment Date.
Interest will be computed on the basis of a 360-day year of twelve 30-day months
(and for any partial periods shall be computed on the basis of the number of
days elapsed in a 360-day year of twelve 30-day months).
Interest payable on any Interest Payment Date will be paid to the person
in whose name a Senior Note is registered at the close of business on the Record
Date next preceding such Interest Payment Date; provided, however, that interest
payable at maturity or upon earlier redemption will be payable to the person to
whom principal shall be payable.
Any payment required to be made in respect of a Senior Note on a date that
is not a Business Day need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on such date,
and no additional interest shall accrue as a result of such delayed payment.
"Business Day" shall mean each day that is not a day on which banking
institutions or trust companies in the Borough of Manhattan, the City and State
of New York, or in the city where the corporate trust office of the Senior Note
Trustee is located, are obligated or authorized by law or executive order to
close.
Principal of, premium, if any, and interest on any series of Senior Notes
represented by Global Securities will be paid in the manner described under
"--Book-Entry Senior Notes."
Redemption Provisions
Except as shall otherwise be provided in a supplement to this prospectus,
each series of Senior Notes will be redeemable, as a whole or in part, at the
Company's option, at any time or from time to time, prior to the maturity of
such series, on at least 30 days, but not more than 60 days, prior notice mailed
to the registered address of each holder of the such series.
The redemption prices will be equal to the greater of (1) 100% of the
principal amount of the series of Senior Notes to be redeemed or (2) as
determined by an Independent Investment Banker
8
<PAGE>
(as defined below), the sum of the present values of the Remaining Scheduled
Payments (as defined below) discounted (for purposes of determining such present
value), on a semi-annual basis (assuming a 360-day year consisting of twelve
30-day months), at a discount rate equal to the sum of the Treasury Rate (as
defined below) and a number of basis points to be set forth in a supplement to
this prospectus.
In each case, accrued interest on such series of Senior Notes to be
redeemed will be payable to the redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the series of Senior Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such series. "Independent Investment Banker"
means one of the Reference Treasury Dealers appointed by the Company.
"Comparable Treasury Price" means, with respect to any redemption date,
(1) the average of the Reference Treasury Dealer Quotations for such redemption
date after excluding the highest and lowest of such Reference Treasury Dealer
Quotations, or (2) if the Senior Note Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such Reference Treasury
Dealer Quotations. "Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Senior Note Trustee, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Senior Note Trustee by such Reference
Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day
preceding such redemption date.
"Reference Treasury Dealer" means such nationally recognized investment
banking firms that are primary U.S. Government securities dealers as are set
forth in a supplement to this prospectus.
"Remaining Scheduled Payments" means, with respect to each series of
Senior Note to be redeemed, the remaining scheduled payments of principal of and
interest on such series that would be due after the related redemption date but
for such redemption. If such redemption date is not an Interest Payment Date
with respect to such series, the amount of the next succeeding scheduled
9
<PAGE>
interest payment on such series will be reduced by the amount of interest
accrued on such series to such redemption date.
On and after the redemption date, interest will cease to accrue on the
series of Senior Notes or any portion of thereof called for redemption (unless
the Company does not deposit the money for the payment of the redemption price
and accrued interest pursuant to the next succeeding paragraph). If less than
all the Senior Notes of any series are to be redeemed, the Senior Notes of such
series to be redeemed shall be selected by the Senior Note Trustee by such
method as it shall deem fair and appropriate.
Any notice of redemption at the option of the Company may state that such
redemption will be conditional upon receipt by the Senior Note Trustee (or a
Paying Agent), on or prior to the date fixed for such redemption, of money
sufficient to pay the principal of and premium, if any, and interest on such
series of Senior Notes and that if such money has not been so received, such
notice will be of no force and effect and the Company will not be required to
redeem such series of Senior Notes.
Except as shall otherwise be provided in a supplement to this prospectus,
the Senior Notes will not be subject to a sinking fund.
The Company may at any time purchase Senior Notes at any price in the open
market or otherwise. Senior Notes so purchased by the Company may be surrendered
to the Senior Note Trustee for cancellation.
Security; Release Date
Until the Release Date, the Senior Notes will be secured by one or more
series of the Company's first mortgage bonds (the "Senior Note Mortgage Bonds")
issued and delivered by the Company to the Senior Note Trustee (see "Description
of Senior Note Mortgage Bonds"). Upon the issuance of a series of Senior Notes
prior to the Release Date, the Company will simultaneously issue and deliver to
the Senior Note Trustee, as security for all the Senior Notes being issued, a
series of Senior Note Mortgage Bonds that will have the same stated maturity
date and corresponding redemption provisions, and will be in the same aggregate
principal amount and have the same interest rate as the corresponding series of
Senior Notes being issued. Any payment by the Company to the Senior Note Trustee
of principal of, premium, if any, and interest on, a series of Senior Note
Mortgage Bonds will be applied by the Senior Note Trustee to satisfy the
Company's obligations with respect to principal of, premium, if any, and
interest on, the related series of Senior Notes.
The Release Date will be the earlier of (1) the date that all First
Mortgage Bonds (as defined herein), other than the Senior Note Mortgage Bonds,
have been retired (whether at, before or after the maturity thereof) through
payment, redemption, purchase, defeasance or otherwise and (2) the date upon
which the
10
<PAGE>
Senior Note Trustee holds Senior Note Mortgage Bonds constituting not less than
80% in aggregate principal amount of all outstanding First Mortgage Bonds. On
the Release Date, the Senior Note Trustee will deliver to the Company for
cancellation all Senior Note Mortgage Bonds and, not later than 30 days
thereafter, will provide notice to all holders of the Senior Notes of the
occurrence of the Release Date. As a result, on the Release Date, the Senior
Note Mortgage Bonds shall cease to secure the Senior Notes and the Senior Notes
will become unsecured and unsubordinated general obligations of the Company.
Each series of Senior Note Mortgage Bonds will be a series of First
Mortgage Bonds of the Company, all of which are secured by a first lien on
substantially all of the Company's property. See "Description of Senior Note
Mortgage Bonds - Kind and Priority of Lien." Upon the payment or cancellation of
any outstanding Senior Notes, the Senior Note Trustee shall surrender to the
Company for cancellation an equal principal amount of the related series of
Senior Note Mortgage Bonds. The Company shall not permit, at any time prior to
the Release Date, the aggregate principal amount of Senior Note Mortgage Bonds
held by the Senior Note Trustee to be less than the aggregate principal amount
of the Senior Notes then outstanding. After the issuance of the first series of
Senior Notes under the Senior Note Indenture, no additional First Mortgage Bonds
will be issued by the Company under the Mortgage (as defined herein) other than
as collateral security for the Senior Notes.
Events of Default
The following constitute events of default under the Senior Note
Indenture: (a) default in the payment of principal of or premium, if any, on any
Senior Note when due and payable; (b) default in the payment of interest on any
Senior Note when due and payable which continues for 60 days; (c) default in the
performance or breach of any other covenant or agreement of the Company in the
Senior Notes or in the Senior Note Indenture and the continuation thereof for 90
days after written notice thereof to the Company by the Senior Note Trustee or
the holders of at least 33% in aggregate principal amount of the outstanding
Senior Notes; (d) prior to the Release Date, the occurrence of a "completed
default" as defined under the Mortgage; provided, however, that the waiver or
cure of such default and the recision and annulment of the consequences thereof
under the Mortgage shall constitute a waiver of the corresponding event of
default under the Senior Note Indenture and a recision and annulment of the
consequences thereof under the Senior Note Indenture; and (e) certain events of
bankruptcy, insolvency, reorganization, assignment or receivership of the
Company.
If an event of default under the Senior Note Indenture occurs and is
continuing, either the Senior Note Trustee or the holders of a majority in
aggregate principal amount of the outstanding Senior Notes may declare, by
notice in writing, the
11
<PAGE>
principal of and interest on all Senior Notes to be due and payable immediately.
Upon such acceleration of the Senior Notes, the Senior Note Mortgage Bonds shall
be immediately redeemable upon demand of the Senior Note Trustee (and surrender
thereof to the Mortgage Trustee, as herein defined) at a redemption price of
100% of the principal amount thereof, together with interest to the redemption
date. See "Description of Senior Note Mortgage Bonds - Redemption Provisions of
Senior Note Mortgage Bonds." At any time after an acceleration of the Senior
Notes has been obtained (and provided the acceleration of all Senior Note
Mortgage Bonds has not occurred), if the Company pays or deposits with the
Senior Note Trustee a sum sufficient to pay all matured installments of interest
and the principal and any premium which has become due on the Senior Notes
otherwise than by acceleration and all defaults shall have been cured or waived,
then such payment or deposit will cause an automatic rescission and annulment of
the acceleration of the Senior Notes.
The Senior Note Indenture provides that the Senior Note Trustee generally
will be under no obligation to exercise any of its rights or powers under the
Senior Note Indenture at the request or direction of any of the holders of the
Senior Notes unless such holders have offered to the Senior Note Trustee
reasonable security or indemnity. Subject to such provisions for indemnity and
certain other limitations contained in the Senior Note Indenture, the holders of
a majority in aggregate principal amount of the outstanding Senior Notes
generally will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Senior Note Trustee, or of
exercising any trust or power conferred on the Senior Note Trustee. The holders
of a majority in aggregate principal amount of the outstanding Senior Notes
generally will have the right to waive any past default or event of default
(other than a payment default) on behalf of all holders of the Senior Notes. The
Senior Note Indenture provides that no holder of the Senior Notes may institute
any action against the Company under the Senior Note Indenture unless such
holder previously shall have given to the Senior Note Trustee written notice of
an event of default and continuance thereof and unless the holders of a majority
in aggregate principal amount of the Senior Notes then outstanding affected by
such event of default shall have requested the Senior Note Trustee to institute
such action and shall have offered the Senior Note Trustee reasonable indemnity,
and the Senior Note Trustee shall not have instituted such action within 60 days
of such request. Furthermore, no holder of the Senior Notes will be entitled to
institute any such action if and to the extent that such action would disturb or
prejudice the rights of other holders of the Senior Notes. Notwithstanding that
the right of a holder of the Senior Notes to institute a proceeding with respect
to the Senior Note Indenture is subject to certain conditions precedent, each
holder of a Senior Note has the right, which is absolute and unconditional, to
receive payment of the principal of, and premium, if any, and interest on such
Senior Note when due and to institute suit for the enforcement of any such
12
<PAGE>
payment, and such rights may not be impaired without the consent of such holders
of Senior Notes. The Senior Note Indenture provides that the Senior Note
Trustee, within 90 days after the occurrence of a default with respect to the
Senior Notes, is required to give holders of the Senior Notes notice of any
default known to the Senior Note Trustee, unless cured or waived, but, except in
the case of default in the payment of principal of, or premium, if any, or
interest on, any Senior Notes, the Senior Note Trustee may withhold such notice
if it determines in good faith that it is in the interest of such holders to do
so. The Company is required to deliver to the Senior Note Trustee each year an
officer's certificate as to whether or not the Company is in compliance with the
conditions and covenants under the Senior Note Indenture.
Book-Entry Senior Notes
Except as shall otherwise be provided in a supplement to this prospectus,
the Senior Notes will be issued in book-entry only form (each Senior Note so
issued, a "Book-Entry Senior Note"), and will be represented by one or more
registered Global Securities (each, a "Global Security") that will be deposited
with, or on behalf of, The Depository Trust Company, New York, New York ("DTC")
or such other Depository which may replace DTC as Depository for the Book-Entry
Senior Notes (the "Depository"), and registered in the name of a nominee of the
Depository.
Upon issuance, all Book-Entry Senior Notes of the same series will be
represented by one Global Security. Except under the circumstances described
below, Book-Entry Senior Notes will not be exchangeable for Senior Notes in
certificated form and will not otherwise be issuable in certificated form.
If the Depository notifies the Company that it is at any time unwilling or
unable to continue as Depository and a successor Depository is not appointed
within 90 days after receipt of such notice, the Company will cause to be issued
Senior Notes in certificated form ("Certificated Senior Notes") in exchange for
the Global Security or Global Securities representing the corresponding
Book-Entry Senior Notes. In addition, the Company may at any time and in its
sole discretion determine not to have any Book-Entry Senior Notes represented by
one or more Global Securities and, in such event, will cause to be issued
individual Certificated Senior Notes in exchange for the Global Security or
Global Securities representing the corresponding Book-Entry Senior Notes.
Lastly, within seven days of the occurrence of an event of default under the
Senior Note Indenture, the Company will cause to be issued Certificated Senior
Notes in exchange for the Global Security or Securities representing the
corresponding Book-Entry Senior Notes. In any such instance, a beneficial owner
of a Book-Entry Senior Note represented by a Global Security will be entitled to
physical delivery of Certificated Senior Notes equal in principal amount to such
Book-Entry Senior Note and to have such Certificated Senior Notes registered in
its name.
13
<PAGE>
The following is based on information furnished by DTC:
DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code,
and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934 (the "Exchange Act"). DTC holds
securities that its participants ("Direct Participants") deposit with DTC.
DTC also facilitates the settlement among Direct Participants of
securities transactions, such as transfers and pledges, in deposited
securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement
of securities certificates. Direct Participants include securities brokers
and dealers, banks, trust companies, clearing corporations, and certain
other organizations. DTC is owned by a number of its Direct Participants
and by the New York Stock Exchange, Inc., the American Stock Exchange,
Inc., and the National Association of Securities Dealers, Inc. Access to
the DTC system is also available to others such as securities brokers and
dealers, banks, and trust companies that clear through or maintain a
custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants and, together with Direct Participants,
the "Participants"). The rules applicable to DTC and its Participants are
on file with the Securities and Exchange Commission.
Purchases of Book-Entry Senior Notes represented by Global
Securities under the DTC system must be made by or through Direct
Participants, which will receive a credit for such purchases of Book-Entry
Senior Notes on DTC's records. The ownership interest of each actual
purchaser of each Book-Entry Senior Note represented by a Global Security
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchase, but Beneficial Owners are
expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the
Direct or Indirect Participant through which the Beneficial Owner entered
into the transaction. Transfers of ownership interests in the Book-Entry
Senior Notes represented by Global Securities are to be accomplished by
entries made on the books of Participants acting on behalf of Beneficial
Owners. Beneficial Owners will not receive certificates representing their
ownership interests in Book-Entry Senior Notes represented by Global
Securities, except in the event that use of the book-entry system for such
Book-Entry Senior Notes is discontinued.
14
<PAGE>
To facilitate subsequent transfers, all Global Securities deposited
with, or on behalf of, DTC are registered in the name of DTC's partnership
nominee, Cede & Co. The deposit of Global Securities with DTC and their
registration in the name of Cede & Co. effect no change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners of the
Book-Entry Senior Notes represented by Global Securities; DTC's records
reflect only the identity of the Direct Participants to whose accounts
such Book-Entry Senior Notes are credited which may or may not be the
Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by
Direct Participants and Indirect Participants to Beneficial Owners will be
governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. If less than all of
the Book-Entry Senior Notes having the same Original Issue Date and other
terms are being redeemed, DTC's practice is to determine by lot the amount
of the interest of each Direct Participant to be so redeemed.
Neither DTC nor Cede & Co. will consent or vote with respect to the
Book-Entry Senior Notes represented by Global Securities. Under its usual
procedures, DTC mails an Omnibus Proxy to the Company as soon as possible
after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting
or voting rights to those Direct Participants to whose accounts the
Book-Entry Senior Notes represented by Global Securities are credited on
the applicable record date (identified in a listing attached to the
Omnibus Proxy).
Principal and any premium and/or interest payments on the Book-Entry
Senior Notes represented by Global Securities will be made to DTC in
immediately available funds. DTC's practice is to credit Direct
Participants' accounts on the date on which interest is payable in
accordance with the respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payment on such date.
Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices, as is the case with securities held
for the accounts of customers in bearer form or registered in "street
name", and will be the responsibility of such Participant and not of DTC,
the underwriters, dealers or agents or the Company, subject to any
statutory or regulatory requirements as may be in effect from time to
time. Payment of principal and any premium and/or interest to DTC is the
responsibility of the Company and the Senior Note Trustee. Disbursement of
such payments to Direct
15
<PAGE>
Participants shall be the responsibility of DTC, and disbursement of such
payments to the Beneficial Owners shall be the responsibility of Direct
and Indirect Participants.
DTC may discontinue providing its services as securities Depository
with respect to the Book-Entry Senior Notes at any time by giving
reasonable notice to the Company and the Senior Note Trustee. Under such
circumstances, in the event that a successor securities Depository is not
obtained, Senior Notes in certificated form are required to be printed and
delivered in exchange for Book-Entry Senior Notes held by DTC.
The Company may decide to discontinue use of the system and
book-entry transfers through DTC (or a successor securities Depository).
In that event, Senior Notes in certificated form will be printed and
delivered in exchange for Book-Entry Senior Notes held by DTC.
So long as Cede & Co. is the registered owner of any series of
Book-Entry Senior Notes, as nominee of DTC, reference herein to holders of
such series of Book-Entry Senior Notes shall mean Cede & Co. or DTC and
shall not mean the Beneficial Owners of the Book-Entry Senior Notes.
Management of DTC is aware that some computer applications, systems
and the like for processing data ("Systems") that are dependent upon
calendar dates, including dates before, on, and after January 1, 2000, may
encounter "Year 2000 problems." DTC has informed Direct Participants and
Indirect Participants and other members of the financial community (the
"Industry") that it has developed and is implementing a program so that
its Systems, as the same relate to the timely payment of distributions
(including principal and interest payments) to securityholders, book-entry
deliveries, and settlement of trades within DTC, continue to function
appropriately. This program includes a technical assessment and a
remediation plan, each of which is complete. Additionally, DTC's plan
includes a testing phase, which is expected to be completed within
appropriate time frames.
However, DTC's ability to perform properly its services is also
dependent upon other parties, including, but not limited to, issuers and
their agents, as well as DTC's Direct Participants and Indirect
Participants, third party vendors from whom DTC licenses software and
hardware, and third party vendors on whom DTC relies for information or
the provision of services, including telecommunication and electrical
utility service providers, among others. DTC has informed the Industry
that it is contacting (and will continue to contact) third party vendors
from whom DTC acquires services to: (1) impress upon them the importance
of such services being Year 2000 compliant; and (2) determine the extent
of their efforts for Year 2000 remediation (and, as appropriate, testing)
of
16
<PAGE>
their services. In addition, DTC is in the process of developing such
contingency plans as it deems appropriate.
According to DTC, the information in the preceding two paragraphs
with respect to DTC has been provided to the Industry for informational
purposes only and is not intended to serve as a representation, warranty,
or contract modification of any kind.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources (including DTC) that the Company believes to be
reliable, but the Company takes no responsibility for the accuracy thereof.
The underwriters, dealers or agents of any Senior Notes may be Direct
Participants of DTC.
None of the Company, the Senior Note Trustee, any underwriters, agents or
dealers or any agent for payment on or registration of transfer or exchange of
any Global Security will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial interests in
such Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial interests.
Modification with Consent of Holders
Modification and amendment of the Senior Note Indenture may be effected by
the Company and the Senior Note Trustee with the consent of the holders of a
majority in aggregate principal amount of the outstanding Senior Notes affected
thereby, provided that no such modification or amendment may, without the
consent of the holder of each outstanding Senior Note affected thereby, (a)
change the maturity date of any Senior Note; (b) reduce the rate (or change the
method of calculation thereof) or extend the time of payment of interest on any
Senior Note; (c) reduce the principal amount of, or premium payable on, any
Senior Note; (d) change the coin or currency of any payment of principal of, or
premium, if any, or interest on, any Senior Note; (e) change the date on which
any Senior Note may be redeemed or repaid at the option of the holder thereof or
adversely affect the rights of a holder to institute suit for the enforcement of
any payment on or with respect to any Senior Note; (f) impair the interest of
the Senior Note Trustee in the Senior Note Mortgage Bonds held by it or, prior
to the Release Date, reduce the principal amount of any series of Senior Note
Mortgage Bonds securing the Senior Notes to an amount less than the principal
amount of the related series of Senior Notes or alter the payment provisions of
such Senior Note Mortgage Bonds in a manner adverse to the holders of the Senior
Notes; or (g) modify the foregoing requirements or reduce the percentage of
outstanding Senior Notes necessary to modify or amend the Senior Note Indenture
or to waive any past default to less than a majority.
17
<PAGE>
Modification without Consent of Holders
Modification and amendment of the Senior Note Indenture may be effected by
the Company and the Senior Note Trustee without the consent of the holders (a)
to add to the covenants of the Company for the benefit of the holders or to
surrender a right conferred on the Company in the Senior Note Indenture; (b) to
add further security for the Senior Notes; (c) to supply omissions, cure
ambiguities or correct defects, which actions, in each case, are not prejudicial
to the interest of the holders in any material respect; or (d) to make any other
change that is not prejudicial to the holders of the Senior Notes in any
material respect.
A supplemental indenture which changes or eliminates any covenants or
other provision of the Senior Note Indenture (or any supplemental indenture)
which has expressly been included solely for the benefit of one or more series
of the Senior Notes, or which modifies the rights of the holders of the Senior
Notes of such series with respect to such covenant or provision, will be deemed
not to affect the rights under the Senior Note Indenture of the holders of the
Senior Notes of any other series.
Defeasance and Discharge
The Senior Note Indenture provides that the Company will be discharged
from any and all obligations in respect to the Senior Notes and the Senior Note
Indenture (except for certain obligations such as obligations to register the
transfer or exchange of the Senior Notes, replace stolen, lost or mutilated
Senior Notes and maintain paying agencies) if, among other things, the Company
irrevocably deposits with the Senior Note Trustee, in trust for the benefit of
the holders of Senior Notes, money or certain United States government
obligations, or any combination thereof, which will provide money in an amount
sufficient, without reinvestment, to make all payments of principal of, premium,
if any, and interest on, the Senior Notes on the dates such payments are due in
accordance with the terms of the Senior Note Indenture and the Senior Notes;
provided that unless all of the Senior Notes mature within 90 days of such
deposit by redemption or otherwise, the Company shall also have delivered to the
Senior Note Trustee an opinion of counsel to the effect that the Company has
received from, or there has been published by, the Internal Revenue Service or
that there has been a change of law (collectively, an "External Tax
Pronouncement"), in either case to the effect that the holders of the Senior
Notes will not recognize income, gain or loss for federal income tax purposes as
a result of such defeasance or discharge of the Senior Note Indenture.
Thereafter, the holders of the Senior Notes may look only to such deposit for
payment of the principal of, and interest and any premium on, the Senior Notes.
If the Company makes the deposit of cash or certain United States
government obligations referred to above with respect to
18
<PAGE>
one or more series of Senior Notes, and otherwise complies with the requirements
of the Senior Note Indenture (except that the opinion of counsel referred to
above need not be based upon an External Tax Pronouncement), then the Company
shall be released with respect to such series of Senior Notes from its
obligations described under "-- Certain Covenants of the Company -- Limitation
on Liens" and "-- Limitation of Sale and Lease-Back Transactions" and "--
Consolidation, Merger and Sale or Disposition of Assets."
Consolidation, Merger and Sale or Disposition of Assets
The Company may not consolidate with or merge into any other corporation
or sell or otherwise dispose of its properties as or substantially as an
entirety to any person unless (1) the successor or transferee corporation or the
person that receives such properties pursuant to such sale, transfer or other
disposition shall be a corporation organized and existing under the laws of the
United States or any state thereof or the District of Columbia, (2) the
successor or transferee corporation or the person that receives such properties
pursuant to such sale, transfer or other disposition assumes by supplemental
indenture the due and punctual payment of the principal of and premium, if any,
and interest on all the Senior Notes and the performance of every covenant of
the Senior Note Indenture to be performed or observed by the Company; and (3) if
prior to the Release Date, the successor or transferee corporation or the person
that receives such properties pursuant to such sale, transfer or other
disposition assumes the Company's obligations under the Mortgage with respect to
the Senior Note Mortgage Bonds. Upon any such consolidation, merger, sale,
transfer or other disposition of the properties of the Company substantially as
an entirety, the successor corporation formed by such consolidation or into
which the Company is merged or the person to which such sale, transfer or other
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under the Senior Note Indenture with the
same effect as if such successor corporation or person had been named as the
Company therein, and the Company will be released from all obligations under the
Senior Note Indenture. For purposes of the Senior Note Indenture, the conveyance
or other transfer by the Company of (1) all or any portion of its facilities for
the generation of electric energy or (2) all of its facilities for the
transmission of electric energy, in each case considered alone or in any
combination with properties described in the other clause, shall in no event be
deemed to constitute a conveyance or other transfer of all the properties of the
Company, as or substantially as an entirety.
Certain Covenants of the Company
Limitation on Liens
The Senior Note Indenture provides that, so long as any such Senior Notes
are outstanding, the Company may not issue, assume,
19
<PAGE>
guarantee or permit to exist after the Release Date any Debt (as defined below)
that is secured by any mortgage, security interest, pledge or lien ("Lien") of
or upon any Operating Property (as defined below) of the Company, whether owned
at the date of the Senior Note Indenture or thereafter acquired, without in any
such case effectively securing the Senior Notes (together with, if the Company
shall so determine, any other indebtedness of the Company ranking equally with
the Senior Notes) equally and ratably with such Debt (but only so long as such
Debt is so secured).
The foregoing restriction will not apply to: (1) Liens on any Operating
Property existing at the time of its acquisition (which Liens may also extend to
subsequent repairs, alterations and improvements to such Operating Property);
(2) Liens on Operating Property of an entity existing at the time such entity is
merged into or consolidated with, or such entity disposes of its properties (or
those of a division) as or substantially as an entirety to, the Company; (3)
Liens on Operating Property to secure the cost of acquisition, construction,
development or substantial repair, alteration or improvement of property or to
secure any Debt incurred to provide funds for any such purpose or for
reimbursement of funds previously expended for any such purpose, provided such
Liens are created or assumed contemporaneously with, or within 18 months after,
such acquisition or the completion of substantial repair or alteration,
construction, development or substantial improvement; (4) Liens in favor of any
state or any department, agency or instrumentality or political subdivision of
any state, or for the benefit of holders of securities issued by any such entity
(or providers of credit enhancement with respect to such securities), to secure
any Debt (including, without limitation, obligations of the Company with respect
to industrial development, pollution control or similar revenue bonds) incurred
for the purpose of financing all or any part of the purchase price or the cost
of substantially repairing or altering, constructing, developing or
substantially improving Operating Property of the Company; (5) Liens under the
Mortgage permitted by the Senior Note Indenture; (6) Liens to secure payment of
compensation to the Senior Note Trustee as provided in the Senior Note
Indenture; (7) any extension, renewal or replacement (or successive extensions,
renewals or replacements), in whole or in part, of any Lien referred to in
clauses (1) through (6), provided, however, that the principal amount of Debt
secured thereby and not otherwise authorized by said clauses (1) to (6),
inclusive, shall not exceed the principal amount of Debt, plus any premium or
fee payable in connection with any such extension, renewal or replacement, so
secured at the time of such extension, renewal or replacement. However, the
foregoing restrictions will not apply to the issuance, assumption or guarantee
by the Company of Debt secured by a Lien which would otherwise be subject to the
foregoing restrictions up to an aggregate amount which, together with all other
secured Debt of the Company (not including secured Debt permitted under any of
the foregoing exceptions) and the
20
<PAGE>
Value (as defined below) of Sale and Lease-Back Transactions (as defined below)
existing at such time (other than Sale and Lease-Back Transactions the proceeds
of which have been applied to the retirement of certain indebtedness, Sale and
Lease-Back Transactions in which the property involved would have been permitted
to be subjected to a Lien under any of the foregoing exceptions in clauses (1)
to (7) and Sale and Lease-Back Transactions that are permitted by the first
sentence of "--Limitations on Sale and Lease-Back Transactions" below), does not
exceed the greater of 15% of Tangible Assets and 15% of Capitalization (as such
terms are defined below).
Limitation on Sale and Lease-Back Transactions
The Senior Note Indenture provides that so long as any Senior Notes are
outstanding, the Company may not enter into or permit to exist after the Release
Date any Sale and Lease-Back Transaction with respect to any Operating Property
(except for transactions involving leases for a term, including renewals, of not
more than 48 months), if the purchasers' commitment is obtained more than 18
months after the later of the completion of the acquisition, construction or
development of such Operating Property or the placing in operation of such
Operating Property or of such Operating Property as constructed or developed or
substantially repaired, altered or improved. This restriction will not apply if
(a) the Company would be entitled pursuant to any of the provisions described in
clauses (1) to (7) of the first sentence of the second paragraph under
"--Limitation on Liens" above to issue, assume, guarantee or permit to exist
Debt secured by a Lien on such Operating Property without equally and ratably
securing the Senior Notes, (b) after giving effect to such Sale and Lease-Back
Transaction, the Company could incur pursuant to the provisions described in the
second sentence of the second paragraph under "--Limitation on Liens", at least
$1.00 of additional Debt secured by Liens (other than Liens permitted by clause
(a)), or (c) the Company applies within 180 days an amount equal to, in the case
of a sale or transfer for cash, the net proceeds (not exceeding the net book
value), and, otherwise, an amount equal to the fair value (as determined by its
Board of Directors) of the Operating Property so leased, to the retirement of
Senior Notes or other Debt of the Company ranking equally with the Senior Notes,
subject to reduction for Senior Notes and such Debt retired during such 180-day
period otherwise than pursuant to mandatory sinking fund or prepayment
provisions and payments at stated maturity.
Certain Definitions
"Capitalization" means the total of all the following items appearing on,
or included in, the consolidated balance sheet of the Company: (1) liabilities
for Debt maturing more than 12 months from the date of determination; and (2)
common stock, preferred stock, Hybrid Preferred Securities (as defined in the
Senior Note Indenture), premium on capital stock, capital
21
<PAGE>
surplus, capital in excess of par value and retained earnings (however the
foregoing may be designated), less, to the extent not otherwise deducted, the
cost of shares of capital stock reacquired by the Company. Subject to the
foregoing, "Capitalization" shall be determined in accordance with generally
accepted accounting principles ("GAAP") and practices applicable to the type of
business in which the Company is engaged and that are approved by independent
accountants regularly retained by the Company, and may be determined as of a
date not more than 60 days prior to the happening of an event for which such
determination is being made.
"Debt" means any outstanding debt of the Company for money borrowed
evidenced by notes, debentures, bonds or other securities, or guarantees of any
thereof.
"Operating Property" means (1) any interest in real property owned by the
Company and (2) any asset owned by the Company that is depreciable in accordance
with GAAP excluding, in either case, any interest of the Company as lessee under
any lease (except for a lease that results from a Sale and Lease-Back
Transaction) which has been or would be capitalized on the books of the lessee
in accordance with GAAP.
"Sale and Lease-Back Transaction" means any arrangement with any person
providing for the leasing to the Company of any Operating Property (except for
leases for a term, including any renewals thereof, of not more than 48 months),
which Operating Property has been or is to be sold or transferred by the Company
to such person; provided, however, Sale and Lease-Back Transaction does not
include any arrangement first entered into prior to the date of the Senior Note
Indenture.
"Tangible Assets" means the amount shown as total assets on the
consolidated balance sheet of the Company, less the following: (1) intangible
assets including, but without limitation, such items as goodwill, trademarks,
trade names, patents, and unamortized debt discount and expense, and (2)
appropriate adjustments, if any, on account of minority interests. Tangible
Assets shall be determined in accordance with GAAP and practices applicable to
the type of business in which the Company is engaged and that are approved by
the independent accountants that are regularly retained by the Company, and may
be determined as of a date not more than 60 days prior to the happening of the
event for which such determination is being made.
"Value" means, with respect to a Sale and Lease-Back Transaction, as of
any particular time, the amount equal to the greater of (1) the net proceeds to
the Company from the sale or transfer of the property leased pursuant to such
Sale and Lease-Back Transaction, and (2) the net book value of such property, as
determined by the Company in accordance with GAAP, in either case multiplied by
a fraction, the numerator of which shall be equal
22
<PAGE>
to the number of full years of the term of the lease that is part of such Sale
and Lease-Back Transaction remaining at the time of determination and the
denominator of which shall be equal to the number of full years of such term,
without regard, in any case, to any renewal or extension options contained in
such lease.
Voting of Senior Note Mortgage Bonds Held by Senior Note Trustee
The Senior Note Trustee, as the holder of Senior Note Mortgage Bonds, will
attend any meeting of bondholders under the Mortgage, or, at its option, will
deliver its proxy in connection therewith relating to matters with respect to
which it is entitled to vote or consent.
The Senior Note Trustee shall vote all Senior Note Mortgage Bonds then
held by it or consent with respect thereto, proportionately with the vote or
consent of the holders of all other First Mortgage Bonds outstanding under the
Mortgage, the holders of which are eligible to vote or consent; provided,
however, that the Senior Note Trustee shall not so vote in favor of, or so
consent to, any amendment or modification of the Mortgage which, if it were an
amendment or modification of the Senior Note Indenture, would require the
consent of the holders of Senior Notes as described under "-- Modification With
Consent of Holders," without the prior consent of holders of Senior Notes which
would be required for such an amendment or modification of the Senior Note
Indenture.
Resignation or Removal of Senior Note Trustee
The Senior Note Trustee may resign at any time upon written notice to the
Company specifying the day upon which the resignation is to take effect and such
resignation will take effect immediately upon the later of the appointment of a
successor Senior Note Trustee and such specified day.
The Senior Note Trustee may be removed at any time by an instrument or
concurrent instruments in writing filed with the Senior Note Trustee and signed
by the holders, or their attorneys-in-fact, of at least a majority in aggregate
principal amount of the then outstanding Senior Notes. In addition, so long as
no event of default under the Senior Note Indenture or event which, with the
giving of notice or lapse of time or both, would become an event of default has
occurred and is continuing, the Company may remove the Senior Note Trustee upon
written notice to the holder of each Senior Note outstanding and the Senior Note
Trustee, and appointment of a successor Senior Note Trustee.
Concerning the Senior Note Trustee
The United States Trust Company of New York is the Senior Note Trustee
under the Senior Note Indenture and the Mortgage Trustee under the Mortgage. The
Senior Note Indenture provides that the Company's obligations to compensate the
Senior Note
23
<PAGE>
Trustee and reimburse the Senior Note Trustee for expenses, disbursements and
advances will constitute indebtedness which will be secured by a lien generally
prior to that of the Senior Notes upon all property and funds held or collected
by the Senior Note Trustee as such. The Senior Note Indenture provides that the
Senior Note Trustee shall be subject to and shall comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, as amended, and that nothing
in the Senior Note Indenture shall be deemed to prohibit the Senior Note Trustee
or the Company from making any application permitted pursuant to such section.
Governing Law
The Senior Note Indenture and each Senior Note will be governed by New
York law.
DESCRIPTION OF SENIOR NOTE MORTGAGE BONDS
General
Each series of Senior Note Mortgage Bonds will be a series of first
mortgage bonds (the "First Mortgage Bonds") to be issued under and secured by
the Company's Indenture dated as of March 1, 1946 between the Company and United
States Trust Company of New York, as successor trustee (the "Mortgage Trustee"),
as heretofore amended and supplemented, and to be further amended and
supplemented by one or more Supplemental Indentures with respect to the Senior
Note Mortgage Bonds (collectively, the "Mortgage"). The statements herein
concerning the First Mortgage Bonds and the Mortgage are summaries and do not
purport to be complete. They may make use of defined terms and are subject to,
and qualified in their entirety by, all of the provisions of the Mortgage, which
is incorporated herein by reference.
The Senior Note Mortgage Bonds will be issued as security for the
Company's obligations under the Senior Note Indenture and will be immediately
delivered to, and registered in the name of, the Senior Note Trustee. The Senior
Note Indenture provides that the Senior Note Trustee shall not transfer any
Senior Note Mortgage Bonds except (1) to a successor trustee, (2) to the Company
(as provided in the Senior Note Indenture) or (3) in compliance with a court
order in connection with a bankruptcy or reorganization proceeding of the
Company. The Senior Note Trustee shall generally vote the Senior Note Mortgage
Bonds proportionately with what it believes to be the vote of the holders of all
other First Mortgage Bonds then outstanding, as described under "Description of
Senior Notes - Voting of Senior Note Mortgage Bonds Held by Senior Note
Trustee."
The Senior Note Mortgage Bonds will correspond to the corresponding series
of Senior Notes in respect of principal amount, interest rate, maturity date and
redemption provisions. Upon payment of the principal of or premium, if any, or
interest
24
<PAGE>
on the Senior Notes, Senior Note Mortgage Bonds of the corresponding series in a
principal amount equal to the principal amount of such Senior Notes will, to the
extent of such payment of principal, premium or interest, be deemed fully paid
and the obligation of the Company to make such payment shall be discharged.
At June 30, 1999, the Company had outstanding $1,173.5 million in
principal amount of First Mortgage Bonds issued under the Mortgage.
Redemption Provisions of Senior Note Mortgage Bonds
The Senior Note Mortgage Bonds will be redeemed on the respective dates
and in the respective principal amounts which correspond to the redemption dates
for, and the principal amounts to be redeemed of, the corresponding series of
Senior Notes. The Senior Note Mortgage Bonds are not redeemable by operation of
the improvement fund or the maintenance provisions of the Mortgage or with the
proceeds of released property.
In the event of an event of default under the Senior Note Indenture and
acceleration of the Senior Notes, the Senior Note Mortgage Bonds will be
immediately redeemable in whole, upon demand of the Senior Note Trustee (and
surrender thereof to the Mortgage Trustee), at a redemption price of 100% of the
principal amount thereof, together with accrued interest to the redemption date.
See "Description of Senior Notes - Events of Default."
Kind and Priority of Lien
The Senior Note Mortgage Bonds and all First Mortgage Bonds outstanding
under the Mortgage will be equally and ratably secured by a direct first lien on
substantially all of the Company's property (except certain real estate not
necessary or appropriate for the Company's business; cash, contracts, choses in
action and securities not specifically subjected to the lien of the Mortgage;
certain equipment not installed as fixed property; merchandise and supplies
acquired, and electricity or products generated or purchased for resale; and
materials and supplies held for consumption), subject to excepted encumbrances,
matters of minor nature and the lien of the Trustee for compensation,
indemnified losses and expenses. The Mortgage provides for subjecting similar
after-acquired property to the lien thereof subject to certain restrictions upon
the acquisition of property subject to outstanding prior lien bonds which are
effective so long as the First Mortgage Bonds are outstanding.
Release and Substitution of Property
Machinery, equipment, fixtures, appliances and other similar property
which is worn-out, obsolete or unnecessary for the operations of the Company may
be disposed of by the Company without a release by the Mortgage Trustee provided
that the Company
25
<PAGE>
replaces it with other property (not necessarily of the same character) which is
equal in value to the property so disposed of. Leases, rights-of-way,
franchises, licenses and permits may be abandoned, surrendered or modified
without a release by the Mortgage Trustee provided any changed or substituted
lease, right-of-way, franchise, license or permit is subject to the lien of the
Mortgage and any consideration received by the Company in connection therewith
must be deposited with the Mortgage Trustee. Such provisions do not have a
material effect on the Company's property. Mortgaged property, subject to
certain conditions, may be released upon substitution of cash or certain other
property of equivalent value and in certain other circumstances. Money received
by the Mortgage Trustee as the result of any release of property may be
withdrawn against, among other things, bondable value of property additions and
bonds previously issued and retired.
The Mortgage Trustee is required to report to bondholders within 90 days
after the release of property of a value of 10% or more of the principal amount
of then outstanding First Mortgage Bonds, and annually as to all other released
property.
Dividend Restrictions
The Mortgage restricts common stock dividends payable by the Company to
the amount of the Company's accumulated earned surplus less $1,729,154. The
amount available for declaration and payment of dividends on the Company's
common stock pursuant to this restriction will be contained in a supplement to
this prospectus.
Issuance of Additional First Mortgage Bonds
So long as the Company is not in default in the performance of any
covenant to be performed by it under the Mortgage and obtains all requisite
authorizations of governmental bodies, it may issue additional First Mortgage
Bonds to the extent of any one or more of the following: (1) 60% of the bondable
value of property additions; (2) the amount of refundable prior lien bonds
theretofore or then retired or deposited with the Mortgage Trustee, as provided
in the Mortgage; (3) the aggregate principal amount of certain bonds theretofore
or then retired; or (4) the amount of cash deposited with the Mortgage Trustee
against the issuance of First Mortgage Bonds.
First Mortgage Bonds may be issued pursuant to (1) and (4) above (and
pursuant to (2) and (3) above unless the interest charges on the retired
refundable prior lien bonds or retired First Mortgage Bonds to be the basis of
such issuance were included in a net earnings certificate previously furnished
to the Mortgage Trustee) only if, for any period of twelve consecutive months
out of the fifteen calendar months preceding the first day of the month
involving the issuance of additional First Mortgage Bonds, net earnings
available for interest shall be at least two times the annual interest
requirements on the First Mortgage Bonds and all
26
<PAGE>
prior lien bonds then and to be outstanding. Net earnings available for interest
generally consists of the excess of gross operating revenues over operating
expenses (other than income taxes), including provision for depreciation equal
to the greater of (1) the book provision for depreciation or (2) the "minimum
provision for depreciation" as outlined below under "Maintenance Fund", plus or
minus net non-operating income or loss with non-operating income limited to 5%
of operating income. Moreover, the Company's charter contains provisions
limiting the ratio of securities evidencing funded indebtedness and unsecured
indebtedness to total capitalization.
The principal amount of additional First Mortgage Bonds issuable pursuant
to these provisions will be contained in a supplement to this prospectus.
Sinking and Improvement Fund
The supplemental indenture creating each series of First Mortgage Bonds
requires that, so long as any such First Mortgage Bonds are outstanding, the
Company will make annual sinking and improvement fund deposits equal to 1% of
the principal amount of First Mortgage Bonds (except First Mortgage Bonds issued
against retired First Mortgage Bonds) delivered by the Trustee prior to January
1 of the year of deposit. Deposits are to be made in cash, reduced by credits
elected by the Company for (1) 60% of bondable value of property additions and
(2) the principal amount of refundable prior lien bonds and certain bonds
previously issued and retired. Cash so deposited may be withdrawn upon the same
basis that a credit may be taken as set forth in the preceding sentence, or may
be applied to the payment, purchase or redemption of First Mortgage Bonds. The
Company met the 1998 sinking fund requirement through the application of
property additions. "Bondable value of property additions" means essentially (a)
the net difference between (1) the lesser of the cost or fair value to the
Company of property additions since January 1, 1946 and (2) all retirements of
property then or thereafter owned, taken at the lesser of original cost or fair
value, as certified to the Mortgage Trustee as property additions, or the
"minimum provision for depreciation", whichever is greater, after credit for
cash substituted for any such retired property, less (b) 10/6ths of the amount
of prior lien bonds having become refundable prior lien bonds and less (c) the
amount of the bondable value of property additions previously used for the
withdrawal of cash, the issuance of bonds or sinking fund credit.
Sinking fund cash amounting to $100,000 or more held by the Mortgage
Trustee on December 31 of any year must be applied to the retirement of First
Mortgage Bonds. The Company may direct the Mortgage Trustee to use sinking fund
cash held by it to purchase First Mortgage Bonds in the open market or to invite
tenders of First Mortgage Bonds to it. If cash held by the Mortgage Trustee is
applied to the purchase of First Mortgage Bonds at less than par, an amount
equal to such discount must be paid to the Company.
27
<PAGE>
Maintenance Fund
The Company is required to make expenditures for property additions and/or
to deposit with the Mortgage Trustee, cash (less, at the option of the Company,
credit for refundable prior lien bonds and First Mortgage Bonds theretofore or
then retired) annually beginning in 1946, in an amount not less than the
"minimum provision for depreciation." All cash so deposited with the Mortgage
Trustee may, during the next succeeding three years, be withdrawn by the Company
to the extent that the amount not less than that expended for property additions
exceeds the "minimum provision for depreciation."
So long as any First Mortgage Bonds are outstanding, the term "minimum
provision for depreciation" with reference to any period after 1952 means an
amount equal to the greater of (i) 15% of the gross operating revenues derived
from bondable property during such period after deducting the aggregate cost of
electric energy and manufactured or natural gas purchased during such period for
resale in connection with the operation of bondable property, less the charges
to operating expense during such period for current repairs and maintenance of
bondable property, and (ii) an amount computed at the rate of 2.25% per annum as
applied to depreciable electric utility property for each year or portion
thereof embraced within such period.
Modification or Amendment of Mortgage
Except as set forth in the next sentence, the rights of the bondholders
may be modified with the consent of the holders of 75% of the principal amount
of the First Mortgage Bonds of all series affected provided that no waiver of a
past default or the consequences thereof shall be effective unless approved by
the holders of not less than a majority of the principal amount of all the First
Mortgage Bonds at the time outstanding. However, no modification of the terms of
payment of principal, premium or interest and no modification permitting the
creation of additional prior or parity liens, reducing the percentage of the
principal amount of First Mortgage Bonds required for modification or depriving
the bondholders of the lien of the Mortgage, is effective against any bondholder
without such bondholder's consent.
Defaults and Notice Thereof
Events of default include default in the payment of principal and premium,
if any, of any of the First Mortgage Bonds; default for 60 days in payment of
interest on any of the First Mortgage Bonds; default in the payment of principal
or interest continued beyond the period of grace on any prior lien bonds;
default, for 60 days after notice, in the performance of any covenant in the
Mortgage; and bankruptcy, insolvency or reorganization (under certain
circumstances) of the Company. The Mortgage Trustee may withhold notice to
bondholders of default (except default in payment of principal, premium,
interest or sinking and improvement
28
<PAGE>
fund installments) if its responsible officers determine that it is in the
interest of the bondholders to do so.
Concerning the Mortgage Trustee
The Mortgage Trustee is permitted to engage in other transactions with the
Company, except that if it acquires any conflicting interest, as defined in the
Mortgage, it must eliminate it or resign and is required in certain cases to
share with the bondholders the benefits of payments received within four months
prior to default. The Mortgage Trustee is the Company's office or agency for the
payment and exchange of First Mortgage Bonds.
Direction by the holders of a majority in principal amount of the First
Mortgage Bonds then outstanding is necessary to require the Mortgage Trustee to
take action. The Mortgage Trustee may require reasonable indemnification before
being required to enforce the lien of the Mortgage. Holders of not less than 25%
in principal amount of outstanding First Mortgage Bonds or the Mortgage Trustee
may declare the principal and interest of all outstanding First Mortgage Bonds
due upon the occurrence of a completed default, but the holders of a majority in
principal amount of the outstanding First Mortgage Bonds may, under certain
circumstances including the curing of such default, annul any such declaration.
Satisfaction and Discharge of Mortgage
Upon the Company's making due provision for the payment of all of the
First Mortgage Bonds and paying all other sums due under the Mortgage, the
Mortgage shall cease to be of further effect and may be satisfied and discharged
of record.
Evidence as to Compliance with Mortgage Provisions
Compliance with the provisions of the Mortgage is evidenced by written
statements of Company officers or persons selected and paid by the Company. In
certain cases, opinions of counsel and certificates of an engineer, accountant,
appraiser or other expert (who in some instances must be independent) must be
furnished. The Mortgage requires that the Company furnish annually to the
Mortgage Trustee a certificate that the Company has complied with, and is not in
default under, the provisions of the Mortgage.
PLAN OF DISTRIBUTION
The Company may sell the Senior Notes: (1) directly to purchasers; (2) to
or through underwriters; or (3) through agents or dealers. The supplement to
this prospectus relating to each series of Senior Notes will set forth the terms
of the offering thereof, including the name or names of any such underwriters,
agents or dealers; the purchase price of and the net proceeds to the Company
from such sale; any underwriting discounts and commissions or agency fees and
other items constituting
29
<PAGE>
underwriters' or agents' compensation; the initial public offering price; and
any discounts or concessions allowed or reallowed or paid to dealers. Any
initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
If underwriters are used in an offering, the Senior Notes will be acquired
by such underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale. The
Senior Notes may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. The underwriter or underwriters with respect to a
particular underwritten offering will be named in a supplement to this
prospectus relating to such offering and, if an underwriting syndicate is used,
the managing underwriter or underwriters will be set forth on the cover of such
supplement. Unless otherwise set forth in a supplement to this prospectus
relating thereto, the obligations of the underwriters to purchase the particular
Senior Notes will be subject to certain conditions precedent, and the
underwriters will be obligated to purchase all such Senior Notes if any are
purchased.
If dealers are utilized in a sale of Senior Notes, the Company will sell
such securities to the dealers as principal. The dealers may then resell such
Senior Notes to the public at varying prices to be determined by such dealers at
the time of resale. The names of the dealers and the terms of the transaction
will be set forth in a supplement to this prospectus relating thereto.
The Senior Notes may be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offer or
sale of the Senior Notes with respect to which this prospectus is delivered will
be named, and any commissions payable by the Company to such agent will be set
forth, in a supplement to this prospectus relating thereto. Unless otherwise
indicated in a supplement to this prospectus, any such agent will be acting on a
best efforts basis for the period of its appointment.
Any underwriters utilized may engage in stabilizing transactions and
syndicate covering transactions in accordance with Rule 104 under the Exchange
Act. Stabilizing transactions permit bids to purchase the underlying security so
long as the stabilizing bids do not exceed a specified maximum. Syndicate
covering transactions involve purchases of the Senior Notes in the open market
after the distribution has been completed in order to cover syndicate short
positions. Such stabilizing transactions and syndicate covering transactions may
cause the price of the Senior Notes to be higher than it would otherwise be in
the absence of such transactions.
30
<PAGE>
Agents, dealers and underwriters may be entitled, under agreements entered
into with the Company, to indemnification by the Company against certain
liabilities, including liabilities under the Securities Act, and to contribution
with respect to payments which such agents, dealers or underwriters may be
required to make in respect thereof. Agents, dealers and underwriters may be
customers of, engage in transactions with, or perform services for the Company
in the ordinary course of business.
Unless otherwise specified in a supplement to this prospectus, the Senior
Notes will not be listed on a national securities exchange. No assurance can be
given that any broker-dealer will make a market in any series of Senior Notes,
and, in any event, no assurance can be given as to the liquidity of the trading
market for any of the Senior Notes. A supplement to this prospectus will state,
if known, whether or not any broker-dealer intends to make a market in the
Senior Notes. If no such determination has been made, such supplement will so
state.
LEGAL MATTERS
Certain legal matters will be passed upon for the Company by Berlack,
Israels & Liberman LLP, New York, New York and for any underwriters, agents or
dealers by Winthrop, Stimson, Putnam & Roberts, New York, New York. Winthrop,
Stimson, Putnam & Roberts may rely on the opinion of Berlack, Israels & Liberman
LLP as to matters of New Jersey law. Attorneys of Berlack, Israels & Liberman
LLP own an aggregate of 13,306 shares of the Common Stock of the Company's
parent, GPU, Inc.
EXPERTS
The consolidated financial statements and financial statement schedule,
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1998, are incorporated herein by reference in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
31
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Securities and Exchange Commission Registration
Fee................................................... $ 55,600
* Blue Sky Fees......................................... $ 5,000
* Accountants' Fees and Expenses........................ $ 10,000
* Company Counsel Fees and Expenses..................... $ 50,000
* Trustees' Fees and Expenses, including Counsel
and Authentication Fees............................... $ 10,000
* Printing of Registration Statement, Prospectus,
Prospectus Supplements, Supplemental Indentures,
etc................................................... $ 10,000
* Rating Agencies' Fees................................. $ 20,000
* Miscellaneous......................................... $ 14,400
...... ----------
*Total Expenses....................................... $ 175,000
- - ------------------------
*Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The By-Laws of the Company provide, in part, as follows:
(a) 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
civil, criminal, administrative or arbitrative action, suit or proceeding, and
any appeal therein and any inquiry or investigation which could lead to such
action, suit or proceeding, other than a proceeding by or in the right of the
Corporation, 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, trustee, employee or agent of another corporation,
partnership, joint venture, sole proprietorship, trust, employee benefit plan or
other enterprise, whether or not for profit, to the fullest extent permitted by
law, including without limitation indemnification against liabilities (amounts
paid or incurred in satisfaction of settlements, judgments, fines and penalties)
and expenses (reasonable costs, disbursements and counsel fees) incurred by such
person in connection with such proceeding, if
(i) such person acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interest of the
corporation; and
(ii) with respect to any criminal proceeding, such person had no
reasonable cause to believe his conduct was unlawful.
The termination of any proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its
<PAGE>
equivalent, shall not of itself create a presumption that such person did not
meet the applicable standards of conduct set forth in Section (a)(i) or in
Section (a)(ii).
(b) The Corporation shall pay the expenses of a person in connection
with any proceeding by or in the right of the Corporation to procure a judgment
in its favor which involves such person by reason of his being or having been a
director, officer or employee of the Corporation (and may pay the expenses of an
agent of the Corporation) if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation. However, in such proceeding no indemnification shall be provided in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the Corporation, unless and only to the extent that the
Superior Court or the court in which such proceeding was brought shall determine
upon application that despite the adjudication of liability, but in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the Superior Court or such other court shall deem
proper.
(c) The Corporation shall indemnify a corporate agent, as defined in
N.J.S. 14A:3-5(1), against expenses to the extent that such corporate agent has
been successful on the merits or otherwise in any proceeding referred to in
Section (a) and (b) or in defense of any claim, issue or matter therein.
(d) Any indemnification under Section (a) and, unless ordered by a
court, under Section (b), may be made by the Corporation only as authorized in a
specific case upon a determination that indemnification is proper in the
circumstances because the director, officer, employee or agent met the
applicable standard of conduct set forth therein. Unless otherwise provided in
the certificate of incorporation or by-laws, such determination shall be made
(i) by the board of directors or a committee thereof, acting by a
majority vote of a quorum consisting of directors who were not
parties to or otherwise involved in the proceeding; or
(ii) if such a quorum is not obtainable, or, even if obtainable and
such quorum of the board of directors or committee by a
majority vote of the disinterested directors so directs, by
independent legal counsel, in a written opinion, such counsel
to be designated by the board of directors.
(e) Expenses incurred by a director, officer or employee in
connection with such a proceeding shall (and expenses incurred by an agent in
connection with such a proceeding may) be paid by the Corporation in advance of
the final disposition of the proceeding as authorized by the board of directors
upon receipt of an undertaking by or on behalf of such person to repay such
amount unless it shall ultimately be determined that he is entitled to be
indemnified as provided in this section.
II-2
<PAGE>
(f) The indemnification and advancement of expenses provided by or
granted pursuant to the other subsections of this section shall not exclude any
other rights to which a person may be otherwise entitled provided that no
indemnification shall be made to or on behalf of a person if a judgment or other
final adjudication adverse to such person establishes that his acts or omissions
(a) were in breach of his duty of loyalty to the corporation or its
shareholders, (b) were not in good faith or involved a knowing violation of law
or (c) resulted in receipt by the corporate agent of an improper personal
benefit.
(g) The Corporation shall have the power to purchase and maintain
insurance on behalf of any director, officer, employee or agent of the
Corporation against any expenses incurred in any proceeding and any liabilities
asserted against him by reason of his being or having been such, whether or not
the Corporation would have the power to indemnify him against such expenses and
liabilities under the provisions of this Section. The Corporation may purchase
such insurance from, or such insurance may be reinsured in whole or in part by,
an insurer owned by or otherwise affiliated with the Corporation, whether or not
such insurer does business with other insureds.
(h) 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.
(i) 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 thereof 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.
(j) 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.
II-3
<PAGE>
Section 14A:3-5 of the New Jersey Business Corporation Act provides
authority for corporations to indemnify under certain circumstances their
officers, directors and other agents against expenses and liabilities incurred
in connection with proceedings arising out of such person's having taken action
on behalf of the corporation.
The directors and officers of the Company are insured under policies of
insurance, within the limits and subject to the limitations of the policies,
against claims made against them for acts in the discharge of their duties and,
subject to certain exceptions, the Company is insured to the extent that it is
required or permitted by law to indemnify the directors and officers of such
loss. The premiums for such insurance are paid by the Company.
ITEM 16. EXHIBITS.
1-A - Form of Underwriting Agreement - to be filed by Form 8-K.
1-B - Form of Amended Distribution Agreement - to be filed by
Form 8-K.
4-A - Form of Senior Note Indenture for the Senior Notes Incorporated
by reference to Exhibit 4-A, Registration No. 333-78717.
4-A(a) - Cross-reference sheet showing location in the Senior Note
Indenture of provisions of Sections 310(a) through 318(a) of the
Trust Indenture Act of 1939 - Included in Exhibit 4-A hereto.
4-B - Indenture of Jersey Central Power & Light Company, dated as of
March 1, 1946, as amended and supplemented by eight supplemental
indentures - Incorporated by reference to the Company's
Instruments of Indebtedness Nos. 1 to 7, inclusive, and 9 and 10
filed as part of Amendment No. 1 to General Public Utilities
Corporation's Annual Report on Form U5S for the year 1959, File
Nos. 30-126 and 1-3292.
4-B-1 - Ninth Supplemental Indenture, dated as of November 1, 1962 -
Incorporated by reference to Exhibit 2-C, Registration No.
2-20732.
4-B-2 - Tenth Supplemental Indenture, dated as of October 1, 1963
Incorporated by reference to Exhibit 2-C, Registration No.
2-21645.
4-B-3 - Eleventh Supplemental Indenture, dated as of October 1, 1964 -
Incorporated by reference to Exhibit 5-A-3, Registration No.
2-59785.
II-4
<PAGE>
4-B-4 - Twelfth Supplemental Indenture, dated as of November 1, 1965 -
Incorporated by reference to Exhibit 5-A-4, Registration No.
2-59785.
4-B-5 - Thirteenth Supplemental Indenture, dated as of August 1, 1966 -
Incorporated by reference to Exhibit 4-C, Registration No.
2-25124.
4-B-6 - Fourteenth Supplemental Indenture, dated as of September 1, 1967
- Incorporated by reference to Exhibit 5-A-6, Registration No.
2-59785.
4-B-7 - Fifteenth Supplemental Indenture, dated as of October 1, 1968 -
Incorporated by reference to Exhibit 5-A-7, Registration No.
2-59785.
4-B-8 - Sixteenth Supplemental Indenture, dated as of October 1, 1969 -
Incorporated by reference to Exhibit 5-A-8, Registration No.
2-59785.
4-B-9 - Seventeenth Supplemental Indenture, dated as of June 1, 1970 -
Incorporated by reference to Exhibit 5-A-9, Registration No.
2-59785.
4-B-10 - Eighteenth Supplemental Indenture, dated as of December 1, 1970 -
Incorporated by reference to Exhibit 5-A-10, Registration No.
2-59785.
4-B-11 - Nineteenth Supplemental Indenture, dated as of February 1, 1971 -
Incorporated by reference to Exhibit 5-A-11, Registration No.
2-59785.
4-B-12 - Twentieth Supplemental Indenture, dated as of November 1, 1971 -
Incorporated by reference to Exhibit 5-A-12, Registration No.
2-59875.
4-B-13 - Twenty-first Supplemental Indenture, dated as of August 1, 1972 -
Incorporated by reference to Exhibit 5-A-13, Registration No.
2-59785.
4-B-14 - Twenty-second Supplemental Indenture, dated as of August 1, 1973
- Incorporated by reference to Exhibit 5-A-14, Registration No.
2-59785.
4-B-15 - Twenty-third Supplemental Indenture, dated as of October 1, 1973
- Incorporated by reference to Exhibit 5-A-15, Registration No.
2-59785.
4-B-16 - Twenty-fourth Supplemental Indenture, dated as of December 1,
1973 - Incorporated by reference to Exhibit 5-A-16, Registration
No. 2-59785.
4-B-17 - Twenty-fifth Supplemental Indenture, dated as of November 1, 1974
- Incorporated by reference to Exhibit 5-A-17, Registration No.
2-59785.
II-5
<PAGE>
4-B-18 - Twenty-sixth Supplemental Indenture, dated as of March 1, 1975 -
Incorporated by reference to Exhibit 5-A-18, Registration No.
2-59785.
4-B-19 - Twenty-seventh Supplemental Indenture, dated as of July 1, 1975 -
Incorporated by reference to Exhibit 5-A-19, Registration No.
2-59785.
4-B-20 - Twenty-eighth Supplemental Indenture, dated as of October 1, 1975
- Incorporated by reference to Exhibit 5-A-20, Registration No.
2-59785.
4-B-21 - Twenty-ninth Supplemental Indenture, dated as of February 1, 1976
- Incorporated by reference to Exhibit 5-A-21, Registration No.
2-59785.
4-B-22 - Supplemental Indenture No. 29A, dated as of May 31, 1976 -
Incorporated by reference to Exhibit 5-A-22, Registration No.
2-59785.
4-B-23 - Thirtieth Supplemental Indenture, dated as of June 1, 1976 -
Incorporated by reference to Exhibit 5-A-23, Registration No.
2-59785.
4-B-24 - Thirty-first Supplemental Indenture, dated as of May 1, 1977 -
Incorporated by reference to Exhibit 5-A-24, Registration No.
2-59785.
4-B-25 - Thirty-second Supplemental Indenture, dated as of January 20,
1978 - Incorporated by reference to Exhibit 5-A-25, Registration
No. 2-60438.
4-B-26 - Thirty-third Supplemental Indenture, dated as of January 1, 1979
- Incorporated by reference to Exhibit A-20(b), Certificate
Pursuant to Rule 24, SEC File No. 70-6242.
4-B-27 - Thirty-fourth Supplemental Indenture, dated as of June 1, 1979 -
Incorporated by reference to Exhibit A-28, Certificate Pursuant
to Rule 24, SEC File No. 70-6290.
4-B-28 - Thirty-sixth Supplemental Indenture, dated as of October 1, 1979
- Incorporated by reference to Exhibit A-30, Certificate Pursuant
to Rule 24, SEC File No. 70-6354.
4-B-29 - Thirty-seventh Supplemental Indenture, dated as of September 1,
1984 - Incorporated by reference to Exhibit A-1(cc), Certificate
Pursuant to Rule 24, SEC File No. 70-7001.
4-B-30 - Thirty-eighth Supplemental Indenture, dated as of July 1, 1985 -
Incorporated by reference to Exhibit A-1(dd), Certificate
Pursuant to Rule 24, SEC File No. 70-7109.
II-6
<PAGE>
4-B-31 - Thirty-ninth Supplemental Indenture, dated as of April 1, 1988 -
Incorporated by reference to Exhibit A-1(a), Certificate Pursuant
to Rule 24, SEC File No. 70-7263.
4-B-32 - Fortieth Supplemental Indenture, dated as of June 14, 1988
Incorporated by reference to Exhibit A-1(ff), Certificate
Pursuant to Rule 24, SEC File No. 70-7603.
4-B-33 - Forty-first Supplemental Indenture, dated as of April 1, 1989 -
Incorporated by reference to Exhibit A-1(gg), Certificate
Pursuant to Rule 24, SEC File No. 70-7603.
4-B-34
- Forty-second Supplemental Indenture, dated as of July 1, 1989 -
Incorporated by reference to Exhibit A-1(hh), Certificate
Pursuant to Rule 24, SEC File No. 70-7603.
4-B-35 - Forty-third Supplemental Indenture, dated as of March 1, 1991 -
Incorporated by reference to Exhibit 4-B-35, Registration No.
33-45314.
4-B-36 - Forty-fourth Supplemental Indenture, dated as of March 1, 1992 -
Incorporated by reference to Exhibit 4-B-36, Registration No.
33-49405.
4-B-37 - Forty-fifth Supplemental Indenture, dated as of October 1, 1992 -
Incorporated by reference to Exhibit 4-B-37, Registration No.
33-49405.
4-B-38 - Forty-sixth Supplemental Indenture, dated April 1, 1993
Incorporated by reference to Exhibit C-15, 1992 Annual Report of
GPU of Form U5S, SEC File No. 30-126.
4-B-39 - Forty-seventh Supplemental Indenture, dated April 10, 1993
Incorporated by reference to Exhibit C-16, 1992 Annual Report of
GPU on Form U5S, SEC File No. 30-126.
4-B-40 - Forty-eighth Supplemental Indenture, dated April 15, 1993
Incorporated by reference to Exhibit C-17, 1992 Annual Report of
GPU on Form U5S, SEC File No. 30-126.
4-B-41 - Forty-ninth Supplemental Indenture, dated October 1, 1993
Incorporated by reference to Exhibit C-18, 1993 Annual Report of
GPU on Form U5S, SEC File No. 30-126.
II-7
<PAGE>
4-B-42 - Fiftieth Supplemental Indenture, dated August 1, 1994
Incorporated by reference to Exhibit C-19, 1994 Annual Report of
GPU on form U5S, SEC File No. 30-126.
4-B-43 - Fifty-first Supplemental Indenture, dated August 15, 1996
Incorporated by reference to Exhibit 4-A-43, 1996 Annual Report
on Form 10-K, SEC File No. 1-6047.
4-B-44 - Fifty-second Supplemental Indenture, dated July 1, 1999.
4-C - Form of Fifty-third Supplemental Indenture for the Senior Note
Mortgage Bonds.
4-D - Forms of Senior Notes - Incorporated by reference to Exhibits A
through D of Exhibit 4-A hereto.
4-E - Form of Senior Note Mortgage Bonds - Incorporated by reference to
Exhibit A of Exhibit 4-C hereto.
5 - Opinion of Berlack, Israels & Liberman LLP.
12-A - Statement Showing Computation of Ratio of Earnings to Fixed
Charges - Incorporated by reference to Exhibit 12-B to the
Company's Annual Report on Form 10-K for the year 1998, SEC File
No. 1-446.
12-B - Statement Showing Computation of Ratio of Earnings to Fixed
Charges for the twelve months ended June 30, 1999.
23-A - Consent of Berlack, Israels & Liberman LLP (included in their
opinion filed as Exhibit 5).
23-B - Consent of PricewaterhouseCoopers LLP.
24 - Power of Attorney - Included on signature pages.
- ---------
The Exhibits listed above which have heretofore been filed with the
Securities and Exchange Commission and which are designated in prior filings as
noted above, are hereby incorporated by reference and made a part hereof with
the same effect as if filed herewith.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
II-8
<PAGE>
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "1933 Act");
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrants pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the 1933 Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the 1933 Act,
each filing of the Registrants annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
II-9
<PAGE>
Insofar as indemnification for liabilities arising under the 1933 Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions under Item 15 above, or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the 1933 Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the 1933 Act and will be governed by the final
adjudication of such issue.
II-10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 including, by the time of sale, the security
rating for the securities registered required thereby, and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized in the Township of Morris, State of New Jersey on the 12th day
of October, 1999.
JERSEY CENTRAL POWER & LIGHT COMPANY
By: /s/ R.L. Wise
----------------------------------
R.L. Wise, President
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that Jersey Central Power & Light Company and
each of its undersigned officers and directors hereby constitutes and appoints
each of B.L. Levy, Ira H. Jolles and T.G. Howson his/her/its true and lawful
attorney-in-fact and agent with full power of substitution and resubstitution
for his/her/it and in his/her/its name, place and stead, in any and all
capacities, to sign all or any amendments (including post-effective amendments)
of and supplements to this registration statement on Form S-3 and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto each such
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, to all intents and purposes and as fully as said Corporation itself
and each said officer or director might or could do in person, hereby ratifying
and confirming all that each such attorney-in-fact and agent, or his/her
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ F.D. Hafer Chairman, Chief Executive Oct. 12, 1999
- --------------------
(F.D. Hafer) Officer
(Principal Executive Officer)
and Director
/s/ R.L. Wise President and Director Oct. 12, 1999
- ---------------------
(R.L. Wise)
/s/ B.L. Levy Vice President and Chief Oct. 12, 1999
- ---------------------
(B.L. Levy) Financial Officer
(Principal Financial Officer)
II-11
<PAGE>
/s/ M.P. O'Flynn Vice President, Comptroller Oct. 12, 1999
- ----------------------
(M.P. O'Flynn) and Director
(Principal Accounting Officer)
/s/ C.B. Snyder Director Oct. 12, 1999
- -----------------------
(C.B. Snyder)
/s/ G.E. Persson Director Oct. 12, 1999
- ------------------------
(G.E. Persson)
/s/ S.C. Van Ness Director Oct. 12, 1999
- ------------------------
(S.C. Van Ness)
/s/ S.B. Wiley Director Oct. 12, 1999
- ------------------------
(S.B. Wiley)
II-12
EXHIBITS TO BE FILED BY EDGAR
Exhibits:
4-B-44 - Fifty-second Supplemental Indenture, dated July 1, 1999.
4-C - Form of Fifty-third Supplemental Indenture for the Senior
Note Mortgage Bonds.
5 - Opinion of Berlack, Israels & Liberman LLP.
12-B - Statement Showing Computation of Ratio of Earnings to Fixed
Charges for the twelve months ended June 30, 1999.
23-B - Consent of PricewaterhouseCoopers LLP.
Exhibit 4-B-44
MORTGAGE
FIFTY-SECOND SUPPLEMENTAL INDENTURE, dated as of the 1st day of July,
1999, made and entered into by and between JERSEY CENTRAL POWER & LIGHT COMPANY,
a corporation organized and existing under the laws of the State of New Jersey
(hereinafter called the "Company"), party of the first part, and UNITED STATES
TRUST COMPANY OF NEW YORK, a bank and trust company organized under the State of
New York bank law, with its principal corporate trust office at 114 West 47th
Street, New York, New York, 10036-1532, as Successor Trustee under the Original
Indenture hereinafter mentioned (the Successor Trustee being hereinafter
sometimes called "Trustee"), party of the second part.
WHEREAS, the Company has heretofore executed and delivered to City Bank
Farmers Trust Company an Indenture dated as of March 1, 1946 (hereinafter called
the "Original Indenture"), to secure the principal of and the interest and
premium (if any) on all bonds at any time issued and outstanding thereunder, to
declare the terms and conditions upon which bonds are to be issued thereunder
and to subject to the lien thereof certain property therein described; and
WHEREAS, United States Trust Company of New York is now acting as
Successor Trustee under the Original Indenture and the indentures supplemental
thereto hereinafter enumerated; and
WHEREAS, the Original Indenture has heretofore been supplemented by a
First Supplemental Indenture dated as of December 1, 1948, a Second Supplemental
Indenture dated as of April 1, 1953, a Third Supplemental Indenture dated as of
June 1, 1954, a Fourth Supplemental Indenture dated as of May 1, 1955, a Fifth
Supplemental Indenture dated as of August 1, 1956, a Sixth Supplemental
Indenture dated as of July 1, 1957, a Seventh Supplemental Indenture dated as of
July 1, 1959, an Eighth Supplemental Indenture dated as of June 1, 1960, a Ninth
Supplemental Indenture dated as of November 1, 1962, a Tenth Supplemental
Indenture dated as of October 1, 1963, an Eleventh Supplemental Indenture dated
as of October 1, 1964, a Twelfth Supplemental Indenture dated as of November 1,
1965, a Thirteenth Supplemental Indenture dated as of August 1, 1966, a
Fourteenth Supplemental Indenture dated as of September 1, 1967, a Fifteenth
Supplemental Indenture dated as of October 1, 1968, a Sixteenth Supplemental
Indenture dated as of October 1, 1969, a Seventeenth Supplemental Indenture
dated as of June 1, 1970, an Eighteenth Supplemental Indenture dated as of
December 1, 1970, a Nineteenth Supplemental Indenture dated as of February 1,
1971, a Twentieth Supplemental Indenture dated as of November 1, 1971, a
Twenty-first Supplemental Indenture dated as of August 1, 1972, a Twenty-second
Supplemental Indenture dated as of August 1, 1973, a Twenty-third Supplemental
Indenture dated as of October 1, 1973, a Twenty-fourth Supplemental Indenture
dated as of December 1, 1973, a Twenty-fifth Supplemental Indenture dated as of
November 1, 1974, a Twenty-sixth Supplemental Indenture dated as of March 1,
1975, a Twenty-seventh
<PAGE>
Supplemental Indenture dated as of July 1, 1975, a Twenty-eighth Supplemental
Indenture dated as of October 1, 1975, a Twenty-ninth Supplemental Indenture
dated as of February 1, 1976, a Supplemental Indenture No. 29A dated as of May
31, 1976, a Thirtieth Supplemental Indenture dated as of June 1, 1976, a
Thirty-first Supplemental Indenture dated as of May 1, 1977, a Thirty-second
Supplemental Indenture dated as of January 20, 1978, a Thirty-third Supplemental
Indenture dated as of January 1, 1979, a Thirty-fourth Supplemental Indenture
dated as of June 1, 1979, a Thirty-fifth Supplemental Indenture dated as of June
15, 1979, a Thirty-sixth Supplemental Indenture dated as of October 1, 1979, a
Thirty-seventh Supplemental Indenture dated as of September 1, 1984, a
Thirty-eighth Supplemental Indenture dated as of July 1, 1985, a Thirty-ninth
Supplemental Indenture dated as of April 1, 1988, a Fortieth Supplemental
Indenture dated as of June 14, 1988, a Forty-first Supplemental Indenture dated
as of April 1, 1989, a Forty-second Supplemental Indenture dated as of July 1,
1989, a Forty-third Supplemental Indenture dated as of March 1, 1991, a
Forty-fourth Supplemental Indenture dated as of March 1, 1992, a Forty-fifth
Supplemental Indenture dated as of October 1, 1992, a Forty-sixth Supplemental
Indenture dated as of April 1, 1993, a Forty-seventh Supplemental Indenture
dated as of April 10, 1993, a Forty-eighth Supplemental Indenture dated as of
April 15, 1993, a Forty-ninth Supplemental Indenture dated as of October 1,
1993, a Fiftieth Supplemental Indenture dated as of August 1, 1994 and a
Fifty-first Supplemental Indenture dated as of August 15, 1996 (hereinafter
respectively called "First Supplemental Indenture," "Second Supplemental
Indenture," "Third Supplemental Indenture," "Fourth Supplemental Indenture,"
"Fifth Supplemental Indenture," "Sixth Supplemental Indenture," "Seventh
Supplemental Indenture," "Eighth Supplemental Indenture," "Ninth Supplemental
Indenture," "Tenth Supplemental Indenture," "Eleventh Supplemental Indenture,"
"Twelfth Supplemental Indenture," "Thirteenth Supplemental Indenture,"
"Fourteenth Supplemental Indenture," "Fifteenth Supplemental Indenture,"
"Sixteenth Supplemental Indenture," "Seventeenth Supplemental Indenture,"
"Eighteenth Supplemental Indenture," "Nineteenth Supplemental Indenture,"
"Twentieth Supplemental Indenture," "Twenty-first Supplemental Indenture,"
"Twenty-second Supplemental Indenture," "Twenty-third Supplemental Indenture,"
"Twenty-fourth Supplemental Indenture," "Twenty-fifth Supplemental Indenture,"
"Twenty-sixth Supplemental Indenture," "Twenty-seventh Supplemental Indenture,"
"Twenty-eighth Supplemental Indenture," "Twenty-ninth Supplemental Indenture,"
"Supplemental Indenture No. 29A," "Thirtieth Supplemental Indenture,"
"Thirty-first Supplemental Indenture," "Thirty-second Supplemental Indenture,"
"Thirty-third Supplemental Indenture," "Thirty-fourth Supplemental Indenture,"
"Thirty-fifth Supplemental Indenture," "Thirty-sixth Supplemental Indenture,"
"Thirty-seventh Supplemental Indenture," "Thirty-eighth Supplemental Indenture,"
"Thirty-ninth Supplemental Indenture," "Fortieth Supplemental Indenture,"
"Forty-first Supplemental Indenture," "Forty-second Supplemental Indenture,"
"Forty-third Supplemental Indenture," "Forty-fourth Supplemental Indenture,"
"Forty-fifth Supplemental Indenture," "Forty-sixth Supplemental Indenture,"
"Forty-seventh Supplemental Indenture," "Forty-eighth Supplemental Indenture,"
-2-
<PAGE>
"Forty-ninth Supplemental Indenture," "Fiftieth Supplemental Indenture" and
"Fifty-first Supplemental Indenture," collectively called "the Supplemental
Indentures"), for the purposes therein expressed; and
WHEREAS, the Original Indenture has been recorded in the proper recording
offices of the following counties in the State of New Jersey and the
Commonwealth of Pennsylvania in Books of Mortgages at the pages respectively
stated as follows:
NEW JERSEY
Mortgage
County Book Page
----------- ---------- --------
Burlington 360 1 &c
Camden 2423 37 &c
Essex I-103 155 &c
Hunterdon 439 284 &c
Mercer 732 280 &c
Middlesex 871 101 &c
Monmouth 1365 1 &c
Morris Z-16 1 &c
Ocean 385 33 &c
Passaic B-24 1 &c
Somerset 386 1 &c
Sussex 394 148 &c
Union 1474 1 &c
Warren 279 191 &c
PENNSYLVANIA
Armstrong 213 421 &c
Bucks 2133 151 &c
Dauphin N52 1 &c
Indiana 200 371 &c
Montgomery 7537 1287 &c
Northampton 1159 1 &c
; and
WHEREAS, the Supplemental Indentures have been recorded in the proper
recording offices of the appropriate counties in the State of New Jersey and the
Commonwealth of Pennsylvania; and
WHEREAS, the Original Indenture, as the same may be amended or
supplemented from time to time by indentures supplemental thereto, is
hereinafter referred to as "the Indenture"; and
WHEREAS, the Company has entered into an Indenture dated as of July 1,
1999 (the "Senior Note Indenture") with United States Trust Company of New York,
as trustee (the "Senior Note Trustee"), providing for the issuance of notes
thereunder (the
-3-
<PAGE>
"Senior Notes") from time to time, and pursuant to the Senior Note Indenture the
Company has agreed to issue to the Senior Note Trustee, as security for the
Senior Notes, a new series of bonds under the Indenture at the time of
authentication of each series of Senior Notes issued prior to the Release Date
(as defined in the Senior Note Indenture); and
WHEREAS, for such purposes the Company desires to issue a new series of
bonds and by appropriate corporate action in conformity with the terms of the
Indenture has duly determined to create a separate series of bonds, which shall
be designated as "First Mortgage Bonds, Senior Note Series E" (hereinafter
sometimes referred to as the "Senior Note Series E Bonds"), which said Senior
Note Series E Bonds are to be substantially in the form set forth in Article II
hereof with the insertion of numbers, denominations, date or dates from which
interest shall accrue, maturities, interest rates (or method of determination
thereof), interest payment dates and other terms as determined in accordance
with the terms of the Indenture; and
WHEREAS, the Senior Note Series E Bonds shall be issued to the Senior Note
Trustee in connection with the issuance by the Company of its Senior Notes,
Series E (the "Series E Notes"); and
WHEREAS, all acts and things prescribed by law and by the certificate of
incorporation and by-laws of the Company necessary to make the Senior Note
Series E Bonds, when executed by the Company and authenticated by the Trustee,
as in the Indenture provided, valid, binding and legal obligations of the
Company, entitled in all respects to the security of the Indenture, have been
performed or will have been performed prior to execution of such Senior Note
Series E Bonds by the Company and authentication thereof by the Trustee; and
WHEREAS, the Original Indenture authorizes the Company and the Trustee to
enter into supplemental indentures for the purpose, among others, of conveying,
transferring and assigning to the Trustee, and subjecting to the lien thereof,
additional properties thereafter acquired by the Company; and
WHEREAS, the Company desires to subject specifically to the lien of the
Indenture certain property acquired by the Company since December 31, 1998; and
WHEREAS, by the provisions of Article XVII of the Original Indenture,
indentures supplemental to the Original Indenture may be executed and delivered
for the purpose of setting forth the terms, provisions and form of the Senior
Note Series E Bonds and supplementing the Original Indenture in a manner which
is not inconsistent with the provisions thereof and does not adversely affect
the interests nor modify the rights of outstanding bonds and for the other
purposes therein more fully set forth; and
WHEREAS, the Company, in the exercise of the powers and authority
conferred upon and reserved to it under the provisions of
-4-
<PAGE>
the Original Indenture and pursuant to appropriate action of its Board of
Directors, has fully resolved and determined to make, execute and deliver to the
Trustee a Fifty-second Supplemental Indenture in the form hereof for the
purposes herein provided; and
WHEREAS, the Company represents that all conditions and requirements
necessary to make this Fifty-second Supplemental Indenture, in the form and upon
the terms hereof, a valid, binding and legal instrument, in accordance with its
terms, and for the purposes herein expressed, have been done, performed and
fulfilled, and the execution and delivery hereof, in the form and upon the terms
hereof, have been in all respects duly authorized.
NOW THEREFORE, THIS FIFTY-SECOND SUPPLEMENTAL INDENTURE WITNESSETH: That
Jersey Central Power & Light Company, in consideration of the premises, and the
execution and delivery by the Trustee of this Fifty-second Supplemental
Indenture and for other good and valuable considerations, receipt of which is
hereby acknowledged, has granted, bargained, sold, aliened, enfeoffed, released,
conveyed, mortgaged, assigned, transferred, pledged, set over and confirmed, and
by these presents does grant, bargain, sell, alien, enfeoff, release, convey,
mortgage, assign, transfer, pledge, set over and confirm unto United States
Trust Company of New York, as Successor Trustee as aforesaid, and to its
successors in the trust created by the Original Indenture and to its and their
successors and assigns forever, all the following properties of the Company,
that is to say:
FIRST
All property additions, as defined in and by Section 1.03 of the Original
Indenture, acquired by the Company on or after January 1, 1999, and prior to
July 1, 1999, and now owned by the Company.
SECOND
Also all property of the character and nature specified in the "Second,"
"Third," "Fourth," "Fifth," and "Sixth" subdivisions of the granting clauses of
the Original Indenture.
EXPRESSLY EXCEPTING AND EXCLUDING, HOWEVER, from this Fifty-second
Supplemental Indenture and from the lien and operation of the Indenture, all
property which, prior to the date of this Fifty-second Supplemental Indenture,
shall have been released from the lien of, or disposed of by the Company in
accordance with the provisions of the Indenture; and all the tracts or parcels
of land and premises and all property of every kind and type excepted and
excluded from, and not heretofore or hereby expressly subjected to, the lien of
the Original Indenture by the terms thereof whether such property was owned by
the Company at the date thereof or has been acquired since that date.
SUBJECT, HOWEVER, except as otherwise expressly provided in this
Fifty-second Supplemental Indenture, to the exceptions, reservations and matters
recited in the Indenture, to the
-5-
<PAGE>
reservations, exceptions, limitations and restrictions contained in the several
deeds, grants, franchises and contracts or other instruments through which the
Company acquired or claims title to the aforesaid property; and subject also to
existing leases, to liens on easements or rights-of-way for transmission or
distribution line purposes, to taxes and assessments not in default, to
easements for alleys, streets, highways, rights-of-way and railroads that may
run across or encroach upon said lands, to joint pole and similar agreements, to
undetermined liens and charges, if any, incidental to the construction and other
permissible encumbrances, as defined in the Original Indenture, and subject also
to the provisions of Section 13.03 of the Original Indenture.
In trust, nevertheless, upon the terms and trusts set forth in the
Indenture.
AND THIS FIFTY-SECOND SUPPLEMENTAL INDENTURE FURTHER WITNESSETH: That the
Company, for the considerations aforesaid, hereby covenants and agrees to and
with the Trustee and its successors in the trust under the Indenture, as
follows:
ARTICLE I.
CONCERNING THE TRUSTEE.
SECTION 1.01. The Trustee hereby accepts the properties hereby mortgaged
and conveyed to it upon the trusts hereinbefore referred to and agrees to
perform the same upon the terms and conditions set forth in the Indenture.
SECTION 1.02. The Trustee shall not be responsible in any manner for or
with respect to the validity or sufficiency of this Fifty-second Supplemental
Indenture, or the due execution hereof by the Company, or for or with respect to
the recitals and statements contained herein, all of which recitals and
statements are made solely by the Company.
ARTICLE II.
CREATION, DESCRIPTION AND FORM OF THE
SENIOR NOTE SERIES E BONDS
SECTION 2.01. The Company hereby creates a series of bonds to be issued
under and secured by the Indenture, to be designated and to be distinguished
from bonds of all other series by the title "First Mortgage Bonds, Senior Note
Series E."
SECTION 2.02. An aggregate principal amount of One Hundred Million Dollars
($100,000,000) of Senior Note Series E Bonds, being authenticated and delivered
from time to time, may forthwith be executed by the Company and delivered to the
Trustee and shall be authenticated by the Trustee and delivered (either before
or after the filing or recording hereof) to or upon the order of the designated
officer or officers of the Company
-6-
<PAGE>
specifying, among other things, the principal amount of the Senior Note Series E
Bonds to be issued on the specified date of issuance, the numbers,
denominations, date or dates from which interest shall accrue, maturities,
interest rates (or method of determination thereof), interest payment dates and
other terms of such Senior Note Series E Bonds, upon receipt by the Trustee of
the cash, resolutions, certificates, opinions and documents required to be
delivered upon the issue of bonds from time to time as provided in the
Indenture.
SECTION 2.03. Each Senior Note Series E Bond shall be dated the date of
its authentication ("issue date") and shall bear interest from the issue date of
said bond or from the most recent interest payment date to which interest has
been paid or duly provided for with respect to the Senior Note Series E Bonds,
except that so long as there is no existing default in the payment of interest
on the Senior Note Series E Bonds, any Senior Note Series E Bond authenticated
by the Trustee between the record date (as hereinafter defined) for any interest
payment date for such bond and such interest payment date shall bear interest
from such interest payment date; provided, however, that if and to the extent
the Company shall default in payment of the interest due on such interest
payment date, then any such Senior Note Series E Bond shall bear interest from
the most recent interest payment date to which interest has been paid or duly
provided for with respect to the Senior Note Series E Bonds, or, if no interest
has been paid on the Senior Note Series E Bonds, then from its issue date. All
Senior Note Series E Bonds shall be payable on their respective maturity dates
in such coin or currency of the United States of America as at the time of
payment is legal tender for the payment of public and private debts, and shall
bear interest payable in like coin or currency, (i) at the interest rate
specified on such Senior Note Series E Bonds, or in accordance with the method
for determining such rate set forth therein, payable on the interest payment
dates specified pursuant to Section 2.02, and on the maturity date, according to
the terms of the Senior Note Series E Bonds or on prior redemption or by
declaration or otherwise, commencing with the interest payment date first
following the issue date of said bond; provided, however, if the issue date of a
Senior Note Series E Bond is between the record date for an interest payment
date and the interest payment date, interest payments on said bond will commence
on the second interest payment date following the issue date, and (ii) at the
highest rate of interest borne by any of the bonds outstanding under the
Indenture from such date of maturity until they shall be paid or payment thereof
shall have been duly provided for, and (to the extent that payment of such
interest is enforceable under applicable law) interest on any overdue
installment of interest shall be payable at the highest rate of interest borne
by any of the bonds outstanding under the Indenture. Principal of and interest
on the Senior Note Series E Bonds shall be payable at the office or agency of
the Company in the Borough of Manhattan, The City of New York.
The persons in whose names the Senior Note Series E Bonds
-7-
<PAGE>
are registered at the close of business on any record date (as hereinafter
defined) with respect to any interest payment date shall be entitled to receive
the interest payable on such interest payment date (except that in case of any
redemption of the Senior Note Series E Bonds as provided for herein on a date
subsequent to the record date and prior to such interest payment date, interest
on such redeemed bonds shall be payable only to the date fixed for redemption
thereof and only against surrender of such bonds for redemption in accordance
with the notice of such redemption) notwithstanding the cancellation of any
Senior Note Series E Bonds upon any registration of transfer or exchange
subsequent to the record date and prior to such interest payment date; provided,
however, that if, and to the extent, the Company shall default in the payment of
the interest due on any interest payment date, such defaulted interest shall be
paid to the persons in whose names outstanding Senior Note Series E Bonds are
registered on the day immediately preceding the date of payment of such
defaulted interest or, at the election of the Company, on a subsequent record
date established by notice given by mail by or on behalf of the Company to the
holders of Senior Note Series E Bonds not less than fifteen days preceding such
subsequent record date.
Unless otherwise specified in the written order of the Company delivered
pursuant to Section 4.07(a) of the Original Indenture with respect to any Senior
Note Series E Bonds, the term "record date" shall mean, with respect to any
regular interest payment date, the close of business on the 15th day of the
calendar month next preceding such interest payment date or, in the case of
defaulted interest, the close of business on any subsequent record date
established as provided above.
SECTION 2.04. Upon any payment of the principal of, premium, if any, and
interest on, all or any portion of the Series E Notes, whether at maturity or
prior to maturity by redemption or otherwise or upon provision for the payment
thereof having been made in accordance with Section 5.01(a) of the Senior Note
Indenture, Senior Note Series E Bonds in a principal amount equal to the
principal amount of such Series E Notes and having both a corresponding maturity
date and interest rate shall, to the extent of such payment of principal,
premium, if any, and interest, be deemed paid and the obligation of the Company
thereunder to make such payment shall be discharged to such extent and, in the
case of the payment of principal (and premium, if any), Senior Note Series E
Bonds in a principal amount equal to the related Series E Notes shall be
surrendered to the Company for cancellation as provided in Section 4.06 of the
Senior Note Indenture. The Trustee may at any time and all times conclusively
assume that the obligation of the Company to make payments with respect to the
principal of and premium, if any, and interest on the Senior Note Series E
Bonds, so far as such payments at the time have become due, has been fully
satisfied and discharged pursuant to the foregoing sentence unless and until the
Trustee shall have received a written notice from the Senior Note Trustee signed
by one of its officers stating
-8-
<PAGE>
(i) that timely payment of principal of, or premium or interest on, the Series E
Notes has not been so made, (ii) that the Company is in arrears as to the
payments required to be made by it to the Senior Note Trustee pursuant to the
Senior Note Indenture, and (iii) the amount of the arrearage.
SECTION 2.05. Each Senior Note Series E Bond is to be issued to and
registered in the name of United States Trust Company of New York, as the Senior
Note Trustee, or a successor trustee thereto, under the Senior Note Indenture to
secure any and all obligations of the Company under the Series E Notes and any
other series of Senior Notes from time to time outstanding under the Senior Note
Indenture.
SECTION 2.06. Except (i) as required to effect an assignment to a
successor Trustee under the Senior Note Indenture, (ii) pursuant to Section 4.03
or Section 4.06 of the Senior Note Indenture, or (iii) in compliance with a
final order of a court of competent jurisdiction in connection with any
bankruptcy or reorganization proceeding of the Company, the Senior Note Series E
Bonds are not transferable. The Senior Note Series E Bonds shall be exchangeable
for other registered bonds of the same series and for the same aggregate
principal amount, in the manner and upon the conditions prescribed in the
Indenture, upon the surrender of such bonds at the office or agency of the
Company in the Borough of Manhattan, The City of New York. The Company covenants
and agrees that, notwithstanding Section 2.03 of the Original Indenture, it will
not charge any sum for or in connection with any exchange or transfer of any
Senior Note Series E Bond.
SECTION 2.07. (a) Senior Note Series E Bonds shall not be redeemed except
(i) as set forth in Section 2.08 hereof; and (ii) by the surrender thereof by
the Senior Note Trustee to the Trustee for cancellation at a redemption price of
zero upon redemption of all other series of bonds pursuant to Section 8.08 of
the Indenture.
(b) In the event the Company redeems any Series E Notes prior to
maturity in accordance with the provisions of the Senior Note Indenture, the
Senior Note Trustee shall on the same date deliver to the Company Senior Note
Series E Bonds in principal amounts corresponding to the Series E Notes so
redeemed, as provided in Section 4.06 of the Senior Note Indenture.
(c) Senior Note Series E Bonds are not redeemable by the operation
of the improvement fund pursuant to Section 5.22 and Section 9.06 of the
Indenture or otherwise or by operation of the maintenance and replacement
provisions of Section 5.07 and Section 9.06 of the Indenture or otherwise or
with the proceeds of released property pursuant to Section 9.06 of the Indenture
or otherwise.
-9-
<PAGE>
SECTION 2.08. The Senior Note Series E Bonds shall be immediately redeemed
at a redemption price of 100% of the principal amount thereof, plus interest
accrued to the redemption date, in whole, upon a written demand for redemption
by the Senior Note Trustee stating that the principal of all Senior Notes then
outstanding under the Senior Note Indenture has been declared to be immediately
due and payable pursuant to the provisions of the first sentence of Section
8.01(a) thereof.
SECTION 2.09. For purposes of Section 4.07 of the Senior Note Indenture,
the Senior Note Series E Bonds shall be deemed to be the "Related Senior Note
First Mortgage Bonds" in respect of the Series E Notes.
SECTION 2.10. At any time a Series E Note shall cease to be entitled to
any lien, benefit or security under the Senior Note Indenture pursuant to
Section 5.01(b) thereof and the Company shall have provided the Senior Note
Trustee with notice thereof, the Senior Note Trustee shall surrender an equal
principal amount of the Related Senior Note First Mortgage Bonds, subject to the
limitations of Section 4.06 of the Senior Note Indenture, to the Company for
cancellation.
SECTION 2.11. As provided in Section 4.09 of the Senior Note Indenture,
from and after the Release Date, the obligations of the Company with respect to
the Senior Note Series E Bonds shall be deemed to be satisfied and discharged,
the Senior Note Series E Bonds shall cease to secure in any manner any Senior
Notes outstanding under the Senior Note Indenture, and, pursuant to Section 4.06
of the Senior Note Indenture, the Senior Note Trustee shall forthwith deliver
the Senior Note Series E Bonds to the Company for cancellation.
SECTION 2.12. Unless otherwise specified in the written order of the
Company delivered pursuant to Section 4.07(a) of the Original Indenture with
respect to any Senior Note Series E Bonds, the form of the Senior Note Series E
Bonds and the Trustee's authentication certificate to be endorsed thereon shall
be substantially as follows, the maturity date or dates, denominations, interest
rates (or method of determination thereof), interest payment dates and other
terms thereof to be appropriately inserted as provided in Section 2.01 of the
Original Indenture.
[FORM OF SENIOR NOTE SERIES E BONDS]
JERSEY CENTRAL POWER & LIGHT COMPANY
FIRST MORTGAGE BOND, SENIOR NOTE SERIES E
$-------------- No.--------
Issue Date Interest Rate Maturity Date
- ---------- ------------- -------------
Interest Payment Dates:
-10-
<PAGE>
JERSEY CENTRAL POWER & LIGHT COMPANY, a corporation organized and existing
under the laws of the State of New Jersey (hereinafter called the "Company"),
for value received, hereby promises to pay to United States Trust Company of New
York, as Trustee under the Company's Indenture dated as of July 1, 1999, or
registered assigns, ---------------- Dollars on the Maturity Date specified
above, unless this Bond shall have been duly called for previous redemption in
whole or in part and payment of the redemption price shall have been duly made
or provided for, at the office or agency of the Company in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts, and to pay to the registered holder hereof interest
thereon, at said office or agency, in like coin or currency, from the Issue Date
specified above, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, until said principal sum has been paid or
provided for, at the Interest Rate per annum specified above, on the Interest
Payment Dates specified above and on the maturity date specified above;
provided, however, if the Issue Date is between the record date for an Interest
Payment Date and the Interest Payment Date, interest payments will commence on
the second Interest Payment Date following the Issue Date; and, to the extent
permitted by law, to pay interest on overdue interest at the highest rate of
interest borne by any of the bonds outstanding under the Mortgage hereinafter
mentioned.
This bond is one of an issue of bonds of the Company (hereinafter referred
to as the "bonds"), not limited in principal amount except as provided in the
Mortgage hereinafter mentioned, which may mature at different times, may bear
interest at different rates, and may otherwise vary as in the Mortgage
hereinafter mentioned provided, and is one of a series known as its First
Mortgage Bonds, Senior Note Series E (herein called the "Senior Note Series E
Bonds"), all bonds issued and to be issued under and equally and ratably secured
(except insofar as any sinking fund or analogous fund, established in accordance
with the provisions of the Mortgage hereinafter mentioned, may afford additional
security for the bonds of any particular series) by an Indenture, dated as of
March 1, 1946, executed by the Company to City Bank Farmers Trust Company,
Trustee (herein, together with any indentures supplemental thereto, including,
but not by way of limitation, the Fifty-second Supplemental Indenture, dated as
of July 1, 1999, called the "Mortgage"), under which United States Trust Company
of New York is Successor Trustee (herein called the "Trustee"), to which
Mortgage reference is made for a description of the property mortgaged and
pledged, the nature and extent of the security, the rights and limitations of
rights of the holders of the bonds and of the Company in respect thereof, the
rights, duties and immunities of the Trustee, and the terms and conditions upon
which the bonds are, and are to be, issued and secured. The Senior Note Series E
Bonds are described in the Fifty-second Supplemental Indenture dated as of July
1, 1999 between the Company and the Trustee (the "Fifty-second Supplemental
Indenture").
-11-
<PAGE>
Under an Indenture dated as of July 1, 1999 (hereinafter sometimes
referred to as the "Senior Note Indenture"), between the Company and United
Trust Company of New York, as trustee (hereinafter sometimes called the "Senior
Note Trustee"), the Company will issue, concurrently with the issuance of this
bond, an issue of notes under the Senior Note Indenture entitled Senior Notes,
Series E (the "Series E Notes"). Pursuant to Article IV of the Senior Note
Indenture, this bond is issued to the Senior Note Trustee to secure any and all
obligations of the Company under the Series E Notes and any other series of
senior notes from time to time outstanding under the Senior Note Indenture.
Payment of principal of, or premium, if any, or interest on, the Series E Notes
shall constitute payments on this bond as further provided herein and in the
Fifty-second Supplemental Indenture.
As provided in Section 4.09 of the Senior Note Indenture, from and after
the Release Date (as defined in the Senior Note Indenture), the obligations of
the Company with respect to this bond shall be deemed to be satisfied and
discharged, this bond shall cease to secure in any manner any senior notes
outstanding under the Senior Note Indenture, and, pursuant to Section 4.06 of
the Senior Note Indenture, the Senior Note Trustee shall forthwith deliver this
bond to the Company for cancellation.
Upon any payment of the principal of, premium, if any, and interest on,
all or any portion of the Series E Notes, whether at maturity or prior to
maturity by redemption or otherwise or upon provision for the payment thereof
having been made in accordance with Section 5.01(a) of the Senior Note
Indenture, Senior Note Series E Bonds in a principal amount equal to the
principal amount of such Series E Notes and having both a corresponding maturity
date and interest rate shall, to the extent of such payment of principal,
premium, if any, and interest, be deemed paid and the obligation of the Company
thereunder to make such payment shall be discharged to such extent and, in the
case of the payment of principal (and premium, if any), Senior Note Series E
Bonds in principal amount equal to the related Series E Notes shall be
surrendered to the Company for cancellation as provided in Section 4.06 of the
Senior Note Indenture. The Trustee may at anytime and all times conclusively
assume that the obligation of the Company to make payments with respect to the
principal of and premium, if any, and interest on the Senior Note Series E
Bonds, so far as such payments at the time have become due, has been fully
satisfied and discharged pursuant to the foregoing sentence unless and until the
Trustee shall have received a written notice from the Senior Note Trustee signed
by one of its officers stating (i) that timely payment of principal of, or
premium or interest on, the Series E Notes has not been made, (ii) that the
Company is in arrears as to the payments required to be made by it to the Senior
Note Trustee pursuant to the Senior Note Indenture, and (iii) the amount of the
arrearage.
For purposes of Section 4.07 of the Senior Note Indenture, this bond shall
be deemed to be the "Related Senior Note First Mortgage Bonds" in respect of the
Series E Notes.
-12-
<PAGE>
The Mortgage contains provisions permitting the holders of not less than
seventy-five per centum (75%) in principal amount of all the bonds at the time
outstanding, determined and evidenced as provided in the Mortgage, or in case
the rights under the Mortgage of the holders of bonds of one or more, but less
than all, of the series of bonds outstanding shall be affected, the holders of
not less than seventy-five per centum (75%) in principal amount of the
outstanding bonds of such one or more series affected, except that if any such
action would affect the bonds of two or more series, the holders of not less
than seventy-five per centum (75%) in principal amount of outstanding bonds of
such two or more series, which need not include seventy-five per centum (75%) in
principal amount of outstanding bonds of each of such series, determined and
evidenced as provided in the Mortgage, on behalf of the holders of all the
bonds, to waive any past default under the Mortgage and its consequences except
a completed default, as defined in the Mortgage, in respect of the payment of
the principal of or interest on any bond or except a default arising from the
creation of any lien ranking prior to or equal with the lien of the Mortgage on
any of the mortgaged property, subject to the condition that, in case the rights
of the holders of less than all of the series of bonds outstanding shall be
affected, no waiver of any past default or its consequences shall be effective
unless approved by the holders of not less than a majority of all the bonds at
the time outstanding. The Mortgage also contains provisions permitting the
Company and the Trustee, with the consent of the holders of not less than
seventy-five per centum (75%) in principal amount of all the bonds at the time
outstanding, determined and evidenced as provided in the Mortgage, or in case
the rights under the Mortgage of the holders of bonds of one or more, but less
than all, of the series of bonds outstanding shall be affected, then with the
consent of the holders of not less than seventy-five per centum (75%) in
principal amount of the outstanding bonds of such one or more series affected,
except that if any such action would affect the bonds of two or more series, the
holders of not less than seventy-five per centum (75%) in principal amount of
outstanding bonds of such two or more series, which need not include
seventy-five per centum (75%) in principal amount of outstanding bonds of each
of such series, determined and evidenced as provided in the Mortgage, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Mortgage or modifying in any manner the
rights of the holders of the bonds and coupons thereunto appertaining; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any bonds, or reduce the rate or extend the time of payment of interest
thereon, or reduce the principal amount thereof, or, subject to the provisions
of the Mortgage, limit the right of a bondholder to institute suit for the
enforcement of payment of principal or interest in accordance with the terms of
the bonds, without the consent of the holder of each bond so affected, or (ii)
reduce the aforesaid percentage of bonds, the holders of which are required to
consent to any such supplemental indenture, without the consent of the holders
of all bonds then outstanding, or (iii) permit the creation of any lien ranking
prior to or equal with the lien of the Mortgage on any of
-13-
<PAGE>
the mortgaged property without the consent of the holders of all bonds then
outstanding, or (iv) deprive the holder of any outstanding bond of the lien of
the Mortgage on any of the mortgaged property. Any such waiver or consent by the
holder of this bond (unless effectively revoked as provided in the Mortgage)
shall be conclusive and binding upon such holder and upon all future holders of
this bond, irrespective of whether or not any notation of such waiver or consent
is made upon this bond.
No reference herein to the Mortgage and no provision of this bond or of
the Mortgage shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this bond at
the time and place and at the rate and in the coin or currency herein
prescribed.
The Senior Note Series E Bonds are issuable only in fully registered form
and in denominations of $1,000 or any higher integral multiple of $1,000.
Senior Note Series E Bonds shall not be redeemed except as set forth below
and except by the surrender thereof by the Senior Note Trustee to the Trustee
for cancellation at a redemption price of zero upon redemption of all other
series of bonds pursuant to Section 8.08 of the Mortgage. In the event the
Company redeems any Series E Notes prior to maturity in accordance with the
provisions of the Senior Note Indenture, the Senior Note Trustee shall on the
same date deliver to the Company Senior Note Series E Bonds in principal amounts
corresponding to the Series E Notes so redeemed, as provided in Section 4.06 of
the Senior Note Indenture. Senior Note Series E Bonds are not redeemable by the
operation of the improvement fund pursuant to Section 5.22 and Section 9.06 of
the Indenture or otherwise or by operation of the maintenance and replacement
provisions of Section 5.07 and Section 9.06 of the Indenture or otherwise or
with the proceeds of released property pursuant to Section 9.06 of the Indenture
or otherwise.
The Senior Note Series E Bonds shall be immediately redeemed at a
redemption price of 100% of the principal amount thereof, plus interest accrued
to the redemption date, in whole, upon a written demand for redemption by the
Senior Note Trustee stating that the principal of all Senior Notes then
outstanding under the Senior Note Indenture have been declared to be immediately
due and payable pursuant to the provisions of the first sentence of Section
8.01(a) thereof.
The Mortgage provides that if the Company shall deposit with the Trustee
in trust for the purpose funds sufficient to pay the principal of all of the
bonds of any series, or such of the bonds of any series as have been or are to
be called for redemption, and premium, if any, thereon, and all interest payable
on such bonds to the date on which they become due and payable, at maturity or
upon redemption or otherwise, and complies with the other provisions of the
Mortgage in respect thereof, then from
-14-
<PAGE>
the date of such deposit such bonds shall no longer be secured by the lien of
the Mortgage.
The principal hereof may be declared or may become due prior to the
express date of the maturity hereof on the conditions, in the manner and at the
time set forth in the Mortgage, upon the occurrence of a completed default as in
the Mortgage provided.
This bond is not transferable except (i) as required to effect an
assignment to a successor Trustee under the Senior Note Indenture, (ii) pursuant
to Section 4.03 or Section 4.06 of the Senior Note Indenture, or (iii) in
compliance with a final order of a court of competent jurisdiction in connection
with any bankruptcy or reorganization proceeding of the Company. This bond shall
be exchangeable for other registered bonds of the same series and for the same
aggregate principal amount, in the manner and upon the conditions prescribed in
the Mortgage, upon the surrender of such bonds at the office or agency of the
Company in the Borough of Manhattan, the City of New York. However,
notwithstanding the provisions of Section 2.03 of the Mortgage, no charge shall
be made upon any registration of transfer or exchange of bonds of said series.
The Company and the Trustee, any paying agent and any bond registrar may deem
and treat the person in whose name this bond is registered as the absolute owner
hereof, whether or not this bond shall be overdue, for the purpose of receiving
payment and for all other purposes and neither the Company nor the Trustee nor
any paying agent nor any bond registrar shall be affected by any notice to the
contrary.
No recourse under or upon any obligation, covenant or agreement contained
in the Mortgage, or in any bond or coupon thereby secured, or because of any
indebtedness thereby secured, shall be had against any incorporator, or against
any past, present or future stockholder, officer or director, as such, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation under any rule of law, statute or constitution, or
by the enforcement of any assessment or by any legal or equitable proceeding or
otherwise; it being expressly agreed and understood that the Mortgage, and the
obligations thereby secured, are solely corporate obligations, and that no
personal liability whatever shall attach to, or be incurred by, such
incorporators, stockholders, officers or directors, as such, of the Company or
of any successor corporation, or any of them because of the incurring of the
indebtedness thereby authorized or under or by reason of any of the obligations,
covenants or agreements contained in the Mortgage or in any of the bonds or
coupons thereby secured, or implied therefrom.
This bond shall not become valid or obligatory for any purpose until
UNITED STATES TRUST COMPANY OF NEW YORK, the Trustee under the Mortgage, or its
successor thereunder, shall have signed the certificate of authentication
endorsed hereon.
-15-
<PAGE>
IN WITNESS WHEREOF, JERSEY CENTRAL POWER & LIGHT COMPANY has caused this
bond to be signed in its name by the manual or facsimile signature of its
President or one of its Vice Presidents and its corporate seal, or a facsimile
thereof, to be affixed hereto and attested by the manual or facsimile signature
of its Secretary or one of its Assistant Secretaries.
Dated:
JERSEY CENTRAL POWER & LIGHT COMPANY
By: /s/ T. G. Howson
-----------------------------
T. G. Howson
Vice President and Treasurer
Attest:
/s/ M. E. Gramlich
- --------------------------
(Assistant) Secretary
-16-
<PAGE>
[FORM OF TRUSTEE'S CERTIFICATE]
TRUSTEE'S AUTHENTICATION CERTIFICATE
This bond is one of the bonds of the series herein designated, provided
for in the within-mentioned Mortgage.
UNITED STATES TRUST COMPANY OF NEW YORK
By: --------------------------------------------
Authorized Officer
[END OF FORM OF SENIOR NOTE SERIES E BOND]
ARTICLE III.
MISCELLANEOUS
SECTION 3.01. For all purposes hereof, except as the context may otherwise
require, (a) all terms contained herein shall have the meanings given such terms
in, and (b) all references herein to sections of the Original Indenture shall be
deemed to be to such sections of, the Original Indenture as the same heretofore
has been or hereafter may be amended by an indenture or indentures supplemental
thereto.
SECTION 3.02. As amended and supplemented by the aforesaid indentures
supplemental thereto and by this Fifty-second Supplemental Indenture, the
Original Indenture is in all respects ratified and confirmed and the Original
Indenture and the aforesaid indentures supplemental thereto and this
Fifty-second Supplemental Indenture shall be read, taken and construed as one
and the same instrument.
SECTION 3.03. This Fifty-second Supplemental Indenture shall be
simultaneously executed in several counterparts, and all such counterparts
executed and delivered, each as an original, shall constitute but one and the
same instrument.
IN WITNESS WHEREOF, JERSEY CENTRAL POWER & LIGHT COMPANY, party of the
first part, has caused this instrument to be signed in its name and behalf by
its President or a Vice President, and its corporate seal to be hereunto affixed
and attested by its Secretary or an Assistant Secretary and United States Trust
Company of New York, as Successor Trustee as aforesaid, the party of the second
part, in token of its acceptance of the trust hereby created, has caused this
instrument to be signed in its name and behalf by an
-17-
<PAGE>
Authorized Officer and its corporate seal to be hereunto affixed and attested by
an Authorized Officer, all as of the day and year first above written.
JERSEY CENTRAL POWER & LIGHT COMPANY
By: /s/ T.G. Howson
--------------------------------
T. G. Howson
Vice President and Treasurer
ATTEST:
/s/ M.E. Gramlich
- ------------------------------
Assistant Secretary
Signed, sealed and delivered by
JERSEY CENTRAL POWER & LIGHT COMPANY
in the presence of:
/s/ Lynn Perillo
- ------------------------------
/s/ Arinthia Conway
- ------------------------------
UNITED STATES TRUST COMPANY
OF NEW YORK
As Successor Trustee as aforesaid
By: /s/ Louis Young
-------------------------------
Vice President
ATTEST:
/s/ Jason G. Gregory
- ------------------------------
Assistant Secretary
Signed, sealed and delivered by
UNITED STATES TRUST COMPANY
OF NEW YORK in the presence of:
/s/ John Guiliano
- ------------------------------
/s/ Gerard F. Ganey
- ------------------------------
-18-
<PAGE>
STATE OF NEW JERSEY )
ss.:
COUNTY OF MORRIS )
BE IT REMEMBERED that on this 28th day of July, 1999 before me, the
subscriber, a notary public in and for said County and State, personally
appeared M.E. Gramlich, an (Assistant) Secretary of JERSEY CENTRAL POWER & LIGHT
COMPANY, the corporation named in and which executed the foregoing instrument,
who, being by me duly sworn according to law, does depose and say and make proof
to my satisfaction that she resides at 30 Tracey Lane, Sparta, New Jersey 07871;
that she is an Assistant Secretary of JERSEY CENTRAL POWER & LIGHT COMPANY; that
the seal affixed to said instrument is the corporate seal of said corporation,
the same being well known to him; that it was so affixed by the order of the
Board of Directors of said corporation; that T.G. Howson is a Vice President of
said corporation; that she saw said T.G. Howson as such Vice President sign such
instrument, and affix said seal thereto and deliver said instrument and heard
him declare that he signed, sealed and delivered said instrument as the
voluntary act and deed of said corporation by its order and by order of its
Board of Directors, for the uses and purposes therein expressed; and that the
said M.E. Gramlich signed his name thereto at the same time as subscribing
witness, and that Jersey Central Power & Light Company, the mortgagor, has
received a true copy of said instrument.
/s/ M.E. Gramlich
------------------------------
Assistant Secretary
Subscribed and sworn to
before me the day and
year aforesaid
/s/ Barbara E. Jost
------------------------------
[NOTARIAL SEAL]
-19-
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED that on this 28th day of July, 1999 before me, the
subscriber, a notary public in and for said County and State, personally
appeared Jason G. Gregory, an Assistant Secretary of UNITED STATES TRUST COMPANY
OF NEW YORK, the corporation named in and which executed the foregoing
instrument, who, being by me duly sworn according to law, does depose and say
and make proof to my satisfaction that he resides at Westwood, New Jersey; that
he is an Assistant Secretary of UNITED STATES TRUST COMPANY OF NEW YORK; that
the seal affixed to said instrument is the corporate seal of said corporation,
the same being well known to him; that it was so affixed by him pursuant to
authority granted by the Board of Directors of said corporation; that Louis P.
Young is a Vice President of said corporation; that he saw said Louis P. Young
as such Vice President sign and deliver said instrument and heard him declare
that he signed and delivered said instrument as the voluntary act and deed of
said corporation pursuant to authority granted by its Board of Directors, for
the uses and purposes therein expressed; and that the said Jason G. Gregory
signed his name thereto at the same time as subscribing witness.
/s/ Jason G. Gregory
------------------------------
Assistant Secretary
Subscribed and sworn to
before me the day and
year aforesaid
/s/ Ann Cosentino
------------------------------
[NOTARIAL SEAL]
-20-
<PAGE>
STATE OF NEW JERSEY )
ss.:
COUNTY OF MORRIS )
On this 28th day of July, 1999, before me came T.G. Howson, to me known,
who, being by me duly sworn, did say that he resides at 49 Hillside Avenue,
Madison, New Jersey 07940; that he is a Vice President of JERSEY CENTRAL POWER &
LIGHT COMPANY, one of the corporations described in and which executed the above
instrument; that he knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that said seal was so affixed by order
of the Board of Directors of said corporation; and that he signed his name to
said instrument by like order.
/s/ Barbara E. Jost
------------------------------
Subscribed and sworn to
before me the day and
year aforesaid
[NOTARIAL SEAL]
-21-
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this 28th day of July, 1999, before me came Louis P. Young, to me known,
who, being by me duly sworn, did say that he resides at Plainview, New York;
that he is a Vice President of UNITED STATES TRUST COMPANY OF NEW YORK, one of
the corporations described in and which executed the above instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that said seal was so affixed by authority of the Board of
Directors of said corporation; and that he signed his name to said instrument by
like authority.
/s/ S. Cosentino
------------------------------
Subscribed and sworn to
before me the day and
year aforesaid
[NOTARIAL SEAL]
-22-
<PAGE>
CERTIFICATE OF RESIDENCE
United States Trust Company of New York, Successor Trustee within named,
hereby certifies that its precise residence is 114 West 47th Street, in the
Borough of Manhattan, in the City of New York, in the State of New York.
UNITED STATES TRUST COMPANY OF NEW YORK
By: /s/ Louis Young
------------------------------
Vice President
-23-
<PAGE>
-----------------------------------
Executed in 50 Counterparts of which
this is Counterpart No. ------
-----------------------------
--------------------------------------------------------
MORTGAGE
JERSEY CENTRAL POWER & LIGHT COMPANY
to
UNITED STATES TRUST COMPANY OF NEW YORK,
Successor Trustee
---------------------
FIFTY-SECOND SUPPLEMENTAL INDENTURE
FIRST MORTGAGE BONDS,
DESIGNATED SENIOR NOTE SERIES E BONDS
---------------------
Dated as of July 1, 1999
--------------------------------------------------------
This instrument prepared by:
-----------------------
Marc B. Lasky, Esq.
<PAGE>
TABLE OF CONTENTS
PARTIES........................................................... 1
RECITALS.......................................................... 1
GRANT............................................................. 5
EXCEPTED PROPERTY................................................. 5
GENERAL SUBJECT CLAUSES........................................... 6
ARTICLE I.
CONCERNING THE TRUSTEE
SECTION 1.01 Acceptance by Trustee of Property
in Trust........................................ 6
SECTION 1.02 Recitals by Company............................. 6
ARTICLE II.
CREATION, DESCRIPTION AND FORM OF THE SENIOR NOTE SERIES E BONDS
SECTION 2.01 Creation of Senior Note Series E
Bonds........................................... 6
SECTION 2.02 $100,000,000 of Senior Note Series E
Bonds issuable.................................. 6
SECTION 2.03 Dating, maturity and payment of
principal and interest of Senior
Note Series E Bonds............................. 7
SECTION 2.04 Payment on Series E Notes
sufficient...................................... 8
SECTION 2.05 Registered in name of Senior Note
Trustee......................................... 9
SECTION 2.06 Senior Note Series E Bonds not
transferable.................................... 9
SECTION 2.07 Redemption provisions........................... 9
SECTION 2.08 Redemption on demand of Senior
Note Trustee.................................... 10
SECTION 2.09 Senior Note Series E Bonds as
"Related Senior Note First
Mortgage Bonds"................................. 10
SECTION 2.10 Surrender of Senior Note Series E
Bonds........................................... 10
i
<PAGE>
SECTION 2.11 Discharge from and after Release
Date............................................ 10
SECTION 2.12 Form of Senior Note Series E Bonds.............. 10
ARTICLE III.
MISCELLANEOUS
SECTION 3.01 Meaning of Certain Terms........................ 17
SECTION 3.02 Original Indenture and
Supplemental Indentures Ratified
and Confirmed................................... 17
SECTION 3.03 Execution in Counterparts....................... 17
TESTIMONIUM ................................................ 17
SIGNATURES AND SEALS.............................................. 18
ACKNOWLEDGMENTS ................................................ 19
CERTIFICATE OF RESIDENCE.......................................... 23
ii
Exhibit 4-C
MORTGAGE
FIFTY-THIRD SUPPLEMENTAL INDENTURE, dated as of the 1st day of October,
1999, made and entered into by and between JERSEY CENTRAL POWER & LIGHT COMPANY,
a corporation organized and existing under the laws of the State of New Jersey
(hereinafter called the "Company"), party of the first part, and UNITED STATES
TRUST COMPANY OF NEW YORK, a bank and trust company organized under the State of
New York bank law, with its principal corporate trust office at 114 West 47th
Street, New York, New York, 10036-1532, as Successor Trustee under the Original
Indenture hereinafter mentioned (the Successor Trustee being hereinafter
sometimes called "Trustee"), party of the second part.
WHEREAS, the Company has heretofore executed and delivered to City Bank
Farmers Trust Company an Indenture dated as of March 1, 1946 (hereinafter called
the "Original Indenture"), to secure the principal of and the interest and
premium (if any) on all bonds at any time issued and outstanding thereunder, to
declare the terms and conditions upon which bonds are to be issued thereunder
and to subject to the lien thereof certain property therein described; and
WHEREAS, United States Trust Company of New York is now acting as
Successor Trustee under the Original Indenture and the indentures supplemental
thereto hereinafter enumerated; and
WHEREAS, the Original Indenture has heretofore been supplemented by a
First Supplemental Indenture dated as of December 1, 1948, a Second Supplemental
Indenture dated as of April 1, 1953, a Third Supplemental Indenture dated as of
June 1, 1954, a Fourth Supplemental Indenture dated as of May 1, 1955, a Fifth
Supplemental Indenture dated as of August 1, 1956, a Sixth Supplemental
Indenture dated as of July 1, 1957, a Seventh Supplemental Indenture dated as of
July 1, 1959, an Eighth Supplemental Indenture dated as of June 1, 1960, a Ninth
Supplemental Indenture dated as of November 1, 1962, a Tenth Supplemental
Indenture dated as of October 1, 1963, an Eleventh Supplemental Indenture dated
as of October 1, 1964, a Twelfth Supplemental Indenture dated as of November 1,
1965, a Thirteenth Supplemental Indenture dated as of August 1, 1966, a
Fourteenth Supplemental Indenture dated as of September 1, 1967, a Fifteenth
Supplemental Indenture dated as of October 1, 1968, a Sixteenth Supplemental
Indenture dated as of October 1, 1969, a Seventeenth Supplemental Indenture
dated as of June 1, 1970, an Eighteenth Supplemental Indenture dated as of
December 1, 1970, a Nineteenth Supplemental Indenture dated as of February 1,
1971, a Twentieth Supplemental Indenture dated as of November 1, 1971, a
Twenty-first Supplemental Indenture dated as of August 1, 1972, a Twenty-second
Supplemental Indenture dated as of August 1, 1973, a Twenty-third Supplemental
Indenture dated as of October 1, 1973, a Twenty-fourth Supplemental Indenture
dated as of December 1, 1973, a Twenty-fifth Supplemental Indenture dated as of
November 1, 1974, a Twenty-sixth Supplemental Indenture dated as of March 1,
1975, a Twenty-seventh
<PAGE>
Supplemental Indenture dated as of July 1, 1975, a Twenty-eighth Supplemental
Indenture dated as of October 1, 1975, a Twenty-ninth Supplemental Indenture
dated as of February 1, 1976, a Supplemental Indenture No. 29A dated as of May
31, 1976, a Thirtieth Supplemental Indenture dated as of June 1, 1976, a
Thirty-first Supplemental Indenture dated as of May 1, 1977, a Thirty-second
Supplemental Indenture dated as of January 20, 1978, a Thirty-third Supplemental
Indenture dated as of January 1, 1979, a Thirty-fourth Supplemental Indenture
dated as of June 1, 1979, a Thirty-fifth Supplemental Indenture dated as of June
15, 1979, a Thirty-sixth Supplemental Indenture dated as of October 1, 1979, a
Thirty-seventh Supplemental Indenture dated as of September 1, 1984, a
Thirty-eighth Supplemental Indenture dated as of July 1, 1985, a Thirty-ninth
Supplemental Indenture dated as of April 1, 1988, a Fortieth Supplemental
Indenture dated as of June 14, 1988, a Forty-first Supplemental Indenture dated
as of April 1, 1989, a Forty-second Supplemental Indenture dated as of July 1,
1989, a Forty-third Supplemental Indenture dated as of March 1, 1991, a
Forty-fourth Supplemental Indenture dated as of March 1, 1992, a Forty-fifth
Supplemental Indenture dated as of October 1, 1992, a Forty-sixth Supplemental
Indenture dated as of April 1, 1993, a Forty-seventh Supplemental Indenture
dated as of April 10, 1993, a Forty-eighth Supplemental Indenture dated as of
April 15, 1993, a Forty-ninth Supplemental Indenture dated as of October 1,
1993, a Fiftieth Supplemental Indenture dated as of August 1, 1994, a
Fifty-first Supplemental Indenture dated as of August 15, 1996 and a
Fifty-second Supplemental Indenture dated as of July 1, 1999 (hereinafter
respectively called "First Supplemental Indenture," "Second Supplemental
Indenture," "Third Supplemental Indenture," "Fourth Supplemental Indenture,"
"Fifth Supplemental Indenture," "Sixth Supplemental Indenture," "Seventh
Supplemental Indenture," "Eighth Supplemental Indenture," "Ninth Supplemental
Indenture," "Tenth Supplemental Indenture," "Eleventh Supplemental Indenture,"
"Twelfth Supplemental Indenture," "Thirteenth Supplemental Indenture,"
"Fourteenth Supplemental Indenture," "Fifteenth Supplemental Indenture,"
"Sixteenth Supplemental Indenture," "Seventeenth Supplemental Indenture,"
"Eighteenth Supplemental Indenture," "Nineteenth Supplemental Indenture,"
"Twentieth Supplemental Indenture," "Twenty-first Supplemental Indenture,"
"Twenty-second Supplemental Indenture," "Twenty-third Supplemental Indenture,"
"Twenty-fourth Supplemental Indenture," "Twenty-fifth Supplemental Indenture,"
"Twenty-sixth Supplemental Indenture," "Twenty-seventh Supplemental Indenture,"
"Twenty-eighth Supplemental Indenture," "Twenty-ninth Supplemental Indenture,"
"Supplemental Indenture No. 29A," "Thirtieth Supplemental Indenture,"
"Thirty-first Supplemental Indenture," "Thirty-second Supplemental Indenture,"
"Thirty-third Supplemental Indenture," "Thirty-fourth Supplemental Indenture,"
"Thirty-fifth Supplemental Indenture," "Thirty-sixth Supplemental Indenture,"
"Thirty-seventh Supplemental Indenture," "Thirty-eighth Supplemental Indenture,"
"Thirty-ninth Supplemental Indenture," "Fortieth Supplemental Indenture,"
"Forty-first Supplemental Indenture," "Forty-second Supplemental Indenture,"
"Forty-third Supplemental Indenture," "Forty-fourth Supplemental Indenture,"
"Forty-fifth Supplemental Indenture," "Forty-sixth Supplemental Indenture,"
"Forty-seventh
-2-
<PAGE>
Supplemental Indenture," "Forty-eighth Supplemental Indenture," "Forty-ninth
Supplemental Indenture," "Fiftieth Supplemental Indenture," "Fifty-first
Supplemental Indenture," and "Fifty-second Supplemental Indenture," collectively
called "the Supplemental Indentures"), for the purposes therein expressed; and
WHEREAS, the Original Indenture has been recorded in the proper recording
offices of the following counties in the State of New Jersey and the
Commonwealth of Pennsylvania in Books of Mortgages at the pages respectively
stated as follows:
NEW JERSEY
Mortgage
County Book Page
--------- --------- -----
Burlington 360 1 &c
Camden 2423 37 &c
Essex I-103 155 &c
Hunterdon 439 284 &c
Mercer 732 280 &c
Middlesex 871 101 &c
Monmouth 1365 1 &c
Morris Z-16 1 &c
Ocean 385 33 &c
Passaic B-24 1 &c
Somerset 386 1 &c
Sussex 394 148 &c
Union 1474 1 &c
Warren 279 191 &c
PENNSYLVANIA
Armstrong 213 421 &c
Bucks 2133 151 &c
Dauphin N52 1 &c
Indiana 200 371 &c
Montgomery 7537 1287 &c
Northampton 1159 1 &c
; and
WHEREAS, the Supplemental Indentures have been recorded in the proper
recording offices of the appropriate counties in the State of New Jersey and the
Commonwealth of Pennsylvania; and
WHEREAS, the Original Indenture, as the same may be amended or
supplemented from time to time by indentures supplemental thereto, is
hereinafter referred to as "the Indenture"; and
WHEREAS, the Company has entered into an Indenture dated as of July 1,
1999 (the "Senior Note Indenture") with United States Trust Company of New York,
as trustee (the "Senior Note
-3-
<PAGE>
Trustee"), providing for the issuance of notes thereunder (the "Senior Notes")
from time to time, and pursuant to the Senior Note Indenture the Company has
agreed to issue to the Senior Note Trustee, as security for the Senior Notes, a
new series of bonds under the Indenture at the time of authentication of each
series of Senior Notes issued prior to the Release Date (as defined in the
Senior Note Indenture); and
WHEREAS, for such purposes the Company desires to issue a new series of
bonds and by appropriate corporate action in conformity with the terms of the
Indenture has duly determined to create a separate series of bonds, which shall
be designated as "First Mortgage Bonds, Senior Note Series E" (hereinafter
sometimes referred to as the "Senior Note Series E Bonds"), which said Senior
Note Series E Bonds are to be substantially in the form set forth in Article II
hereof with the insertion of numbers, denominations, date or dates from which
interest shall accrue, maturities, interest rates (or method of determination
thereof), interest payment dates and other terms as determined in accordance
with the terms of the Indenture; and
WHEREAS, the Senior Note Series E Bonds shall be issued to the Senior Note
Trustee in connection with the issuance by the Company of its Senior Notes,
Series E (the "Series E Notes"); and
WHEREAS, all acts and things prescribed by law and by the certificate of
incorporation and by-laws of the Company necessary to make the Senior Note
Series E Bonds, when executed by the Company and authenticated by the Trustee,
as in the Indenture provided, valid, binding and legal obligations of the
Company, entitled in all respects to the security of the Indenture, have been
performed or will have been performed prior to execution of such Senior Note
Series E Bonds by the Company and authentication thereof by the Trustee; and
WHEREAS, the Original Indenture authorizes the Company and the Trustee to
enter into supplemental indentures for the purpose, among others, of conveying,
transferring and assigning to the Trustee, and subjecting to the lien thereof,
additional properties thereafter acquired by the Company; and
WHEREAS, the Company desires to subject specifically to the lien of the
Indenture certain property acquired by the Company since July 1, 1999; and
WHEREAS, by the provisions of Article XVII of the Original Indenture,
indentures supplemental to the Original Indenture may be executed and delivered
for the purpose of setting forth the terms, provisions and form of the Senior
Note Series E Bonds and supplementing the Original Indenture in a manner which
is not inconsistent with the provisions thereof and does not adversely affect
the interests nor modify the rights of outstanding bonds and for the other
purposes therein more fully set forth; and
WHEREAS, the Company, in the exercise of the powers and authority
conferred upon and reserved to it under the provisions of
-4-
<PAGE>
the Original Indenture and pursuant to appropriate action of its Board of
Directors, has fully resolved and determined to make, execute and deliver to the
Trustee a Fifty-third Supplemental Indenture in the form hereof for the purposes
herein provided; and
WHEREAS, the Company represents that all conditions and requirements
necessary to make this Fifty-third Supplemental Indenture, in the form and upon
the terms hereof, a valid, binding and legal instrument, in accordance with its
terms, and for the purposes herein expressed, have been done, performed and
fulfilled, and the execution and delivery hereof, in the form and upon the terms
hereof, have been in all respects duly authorized.
NOW THEREFORE, THIS FIFTY-THIRD SUPPLEMENTAL INDENTURE WITNESSETH: That
Jersey Central Power & Light Company, in consideration of the premises, and the
execution and delivery by the Trustee of this Fifty-third Supplemental Indenture
and for other good and valuable considerations, receipt of which is hereby
acknowledged, has granted, bargained, sold, aliened, enfeoffed, released,
conveyed, mortgaged, assigned, transferred, pledged, set over and confirmed, and
by these presents does grant, bargain, sell, alien, enfeoff, release, convey,
mortgage, assign, transfer, pledge, set over and confirm unto United States
Trust Company of New York, as Successor Trustee as aforesaid, and to its
successors in the trust created by the Original Indenture and to its and their
successors and assigns forever, all the following properties of the Company,
that is to say:
FIRST
All property additions, as defined in and by Section 1.03 of the Original
Indenture, acquired by the Company on or after July 1, 1999, and prior to
October 1, 1999, and now owned by the Company.
SECOND
Also all property of the character and nature specified in the "Second,"
"Third," "Fourth," "Fifth," and "Sixth" subdivisions of the granting clauses of
the Original Indenture.
EXPRESSLY EXCEPTING AND EXCLUDING, HOWEVER, from this Fifty-third
Supplemental Indenture and from the lien and operation of the Indenture, all
property which, prior to the date of this Fifty-third Supplemental Indenture,
shall have been released from the lien of, or disposed of by the Company in
accordance with the provisions of the Indenture; and all the tracts or parcels
of land and premises and all property of every kind and type excepted and
excluded from, and not heretofore or hereby expressly subjected to, the lien of
the Original Indenture by the terms thereof whether such property was owned by
the Company at the date thereof or has been acquired since that date.
SUBJECT, HOWEVER, except as otherwise expressly provided in this
Fifty-third Supplemental Indenture, to the exceptions, reservations and matters
recited in the Indenture, to the
-5-
<PAGE>
reservations, exceptions, limitations and restrictions contained in the several
deeds, grants, franchises and contracts or other instruments through which the
Company acquired or claims title to the aforesaid property; and subject also to
existing leases, to liens on easements or rights-of-way for transmission or
distribution line purposes, to taxes and assessments not in default, to
easements for alleys, streets, highways, rights-of-way and railroads that may
run across or encroach upon said lands, to joint pole and similar agreements, to
undetermined liens and charges, if any, incidental to the construction and other
permissible encumbrances, as defined in the Original Indenture, and subject also
to the provisions of Section 13.03 of the Original Indenture.
In trust, nevertheless, upon the terms and trusts set forth in the
Indenture.
AND THIS FIFTY-THIRD SUPPLEMENTAL INDENTURE FURTHER WITNESSETH: That the
Company, for the considerations aforesaid, hereby covenants and agrees to and
with the Trustee and its successors in the trust under the Indenture, as
follows:
ARTICLE I.
CONCERNING THE TRUSTEE.
SECTION 1.01. The Trustee hereby accepts the properties hereby mortgaged
and conveyed to it upon the trusts hereinbefore referred to and agrees to
perform the same upon the terms and conditions set forth in the Indenture.
SECTION 1.02. The Trustee shall not be responsible in any manner for or
with respect to the validity or sufficiency of this Fifty-third Supplemental
Indenture, or the due execution hereof by the Company, or for or with respect to
the recitals and statements contained herein, all of which recitals and
statements are made solely by the Company.
ARTICLE II.
CREATION, DESCRIPTION AND FORM OF THE
SENIOR NOTE SERIES E BONDS
SECTION 2.01. The Company hereby creates a series of bonds to be issued
under and secured by the Indenture, to be designated and to be distinguished
from bonds of all other series by the title "First Mortgage Bonds, Senior Note
Series E."
SECTION 2.02. An aggregate principal amount of Two Hundred Million Dollars
($200,000,000) of Senior Note Series E Bonds, being authenticated and delivered
from time to time, may forthwith be executed by the Company and delivered to the
Trustee and shall be authenticated by the Trustee and delivered (either before
or after the filing or recording hereof) to or upon the order of the designated
officer or officers of the Company
-6-
<PAGE>
specifying, among other things, the principal amount of the Senior Note Series E
Bonds to be issued on the specified date of issuance, the numbers,
denominations, date or dates from which interest shall accrue, maturities,
interest rates (or method of determination thereof), interest payment dates and
other terms of such Senior Note Series E Bonds, upon receipt by the Trustee of
the cash, resolutions, certificates, opinions and documents required to be
delivered upon the issue of bonds from time to time as provided in the
Indenture.
SECTION 2.03. Each Senior Note Series E Bond shall be dated the date of
its authentication ("issue date") and shall bear interest from the issue date of
said bond or from the most recent interest payment date to which interest has
been paid or duly provided for with respect to the Senior Note Series E Bonds,
except that so long as there is no existing default in the payment of interest
on the Senior Note Series E Bonds, any Senior Note Series E Bond authenticated
by the Trustee between the record date (as hereinafter defined) for any interest
payment date for such bond and such interest payment date shall bear interest
from such interest payment date; provided, however, that if and to the extent
the Company shall default in payment of the interest due on such interest
payment date, then any such Senior Note Series E Bond shall bear interest from
the most recent interest payment date to which interest has been paid or duly
provided for with respect to the Senior Note Series E Bonds, or, if no interest
has been paid on the Senior Note Series E Bonds, then from its issue date. All
Senior Note Series E Bonds shall be payable on their respective maturity dates
in such coin or currency of the United States of America as at the time of
payment is legal tender for the payment of public and private debts, and shall
bear interest payable in like coin or currency, (i) at the interest rate
specified on such Senior Note Series E Bonds, or in accordance with the method
for determining such rate set forth therein, payable on the interest payment
dates specified pursuant to Section 2.02, and on the maturity date, according to
the terms of the Senior Note Series E Bonds or on prior redemption or by
declaration or otherwise, commencing with the interest payment date first
following the issue date of said bond; provided, however, if the issue date of a
Senior Note Series E Bond is between the record date for an interest payment
date and the interest payment date, interest payments on said bond will commence
on the second interest payment date following the issue date, and (ii) at the
highest rate of interest borne by any of the bonds outstanding under the
Indenture from such date of maturity until they shall be paid or payment thereof
shall have been duly provided for, and (to the extent that payment of such
interest is enforceable under applicable law) interest on any overdue
installment of interest shall be payable at the highest rate of interest borne
by any of the bonds outstanding under the Indenture. Principal of and interest
on the Senior Note Series E Bonds shall be payable at the office or agency of
the Company in the Borough of Manhattan, The City of New York.
The persons in whose names the Senior Note Series E Bonds
-7-
<PAGE>
are registered at the close of business on any record date (as hereinafter
defined) with respect to any interest payment date shall be entitled to receive
the interest payable on such interest payment date (except that in case of any
redemption of the Senior Note Series E Bonds as provided for herein on a date
subsequent to the record date and prior to such interest payment date, interest
on such redeemed bonds shall be payable only to the date fixed for redemption
thereof and only against surrender of such bonds for redemption in accordance
with the notice of such redemption) notwithstanding the cancellation of any
Senior Note Series E Bonds upon any registration of transfer or exchange
subsequent to the record date and prior to such interest payment date; provided,
however, that if, and to the extent, the Company shall default in the payment of
the interest due on any interest payment date, such defaulted interest shall be
paid to the persons in whose names outstanding Senior Note Series E Bonds are
registered on the day immediately preceding the date of payment of such
defaulted interest or, at the election of the Company, on a subsequent record
date established by notice given by mail by or on behalf of the Company to the
holders of Senior Note Series E Bonds not less than fifteen days preceding such
subsequent record date.
Unless otherwise specified in the written order of the Company delivered
pursuant to Section 4.07(a) of the Original Indenture with respect to any Senior
Note Series E Bonds, the term "record date" shall mean, with respect to any
regular interest payment date, the close of business on the 15th day of the
calendar month next preceding such interest payment date or, in the case of
defaulted interest, the close of business on any subsequent record date
established as provided above.
SECTION 2.04. Upon any payment of the principal of, premium, if any, and
interest on, all or any portion of the Series E Notes, whether at maturity or
prior to maturity by redemption or otherwise or upon provision for the payment
thereof having been made in accordance with Section 5.01(a) of the Senior Note
Indenture, Senior Note Series E Bonds in a principal amount equal to the
principal amount of such Series E Notes and having both a corresponding maturity
date and interest rate shall, to the extent of such payment of principal,
premium, if any, and interest, be deemed paid and the obligation of the Company
thereunder to make such payment shall be discharged to such extent and, in the
case of the payment of principal (and premium, if any), Senior Note Series E
Bonds in a principal amount equal to the related Series E Notes shall be
surrendered to the Company for cancellation as provided in Section 4.06 of the
Senior Note Indenture. The Trustee may at any time and all times conclusively
assume that the obligation of the Company to make payments with respect to the
principal of and premium, if any, and interest on the Senior Note Series E
Bonds, so far as such payments at the time have become due, has been fully
satisfied and discharged pursuant to the foregoing sentence unless and until the
Trustee shall have received a written notice from the Senior Note Trustee signed
by one of its officers stating
-8-
<PAGE>
(i) that timely payment of principal of, or premium or interest on, the Series E
Notes has not been so made, (ii) that the Company is in arrears as to the
payments required to be made by it to the Senior Note Trustee pursuant to the
Senior Note Indenture, and (iii) the amount of the arrearage.
SECTION 2.05. Each Senior Note Series E Bond is to be issued to and
registered in the name of United States Trust Company of New York, as the Senior
Note Trustee, or a successor trustee thereto, under the Senior Note Indenture to
secure any and all obligations of the Company under the Series E Notes and any
other series of Senior Notes from time to time outstanding under the Senior Note
Indenture.
SECTION 2.06. Except (i) as required to effect an assignment to a
successor Trustee under the Senior Note Indenture, (ii) pursuant to Section 4.03
or Section 4.06 of the Senior Note Indenture, or (iii) in compliance with a
final order of a court of competent jurisdiction in connection with any
bankruptcy or reorganization proceeding of the Company, the Senior Note Series E
Bonds are not transferable. The Senior Note Series E Bonds shall be exchangeable
for other registered bonds of the same series and for the same aggregate
principal amount, in the manner and upon the conditions prescribed in the
Indenture, upon the surrender of such bonds at the office or agency of the
Company in the Borough of Manhattan, The City of New York. The Company covenants
and agrees that, notwithstanding Section 2.03 of the Original Indenture, it will
not charge any sum for or in connection with any exchange or transfer of any
Senior Note Series E Bond.
SECTION 2.07. (a) Senior Note Series E Bonds shall not be redeemed except
(i) as set forth in Section 2.08 hereof; and (ii) by the surrender thereof by
the Senior Note Trustee to the Trustee for cancellation at a redemption price of
zero upon redemption of all other series of bonds pursuant to Section 8.08 of
the Indenture.
(b) In the event the Company redeems any Series E Notes prior to
maturity in accordance with the provisions of the Senior Note Indenture, the
Senior Note Trustee shall on the same date deliver to the Company Senior Note
Series E Bonds in principal amounts corresponding to the Series E Notes so
redeemed, as provided in Section 4.06 of the Senior Note Indenture.
(c) Senior Note Series E Bonds are not redeemable by the operation
of the improvement fund pursuant to Section 5.22 and Section 9.06 of the
Indenture or otherwise or by operation of the maintenance and replacement
provisions of Section 5.07 and Section 9.06 of the Indenture or otherwise or
with the proceeds of released property pursuant to Section 9.06 of the Indenture
or otherwise.
SECTION 2.08. The Senior Note Series E Bonds shall be immediately
redeemed at a redemption price of 100% of the
-9-
<PAGE>
principal amount thereof, plus interest accrued to the redemption date, in
whole, upon a written demand for redemption by the Senior Note Trustee stating
that the principal of all Senior Notes then outstanding under the Senior Note
Indenture has been declared to be immediately due and payable pursuant to the
provisions of the first sentence of Section 8.01(a) thereof.
SECTION 2.09. For purposes of Section 4.07 of the Senior Note Indenture,
the Senior Note Series E Bonds shall be deemed to be the "Related Senior Note
First Mortgage Bonds" in respect of the Series E Notes.
SECTION 2.10. At any time a Series E Note shall cease to be entitled to
any lien, benefit or security under the Senior Note Indenture pursuant to
Section 5.01(b) thereof and the Company shall have provided the Senior Note
Trustee with notice thereof, the Senior Note Trustee shall surrender an equal
principal amount of the Related Senior Note First Mortgage Bonds, subject to the
limitations of Section 4.06 of the Senior Note Indenture, to the Company for
cancellation.
SECTION 2.11. As provided in Section 4.09 of the Senior Note Indenture,
from and after the Release Date, the obligations of the Company with respect to
the Senior Note Series E Bonds shall be deemed to be satisfied and discharged,
the Senior Note Series E Bonds shall cease to secure in any manner any Senior
Notes outstanding under the Senior Note Indenture, and, pursuant to Section 4.06
of the Senior Note Indenture, the Senior Note Trustee shall forthwith deliver
the Senior Note Series E Bonds to the Company for cancellation.
SECTION 2.12. Unless otherwise specified in the written order of the
Company delivered pursuant to Section 4.07(a) of the Original Indenture with
respect to any Senior Note Series E Bonds, the form of the Senior Note Series E
Bonds and the Trustee's authentication certificate to be endorsed thereon shall
be substantially as follows, the maturity date or dates, denominations, interest
rates (or method of determination thereof), interest payment dates and other
terms thereof to be appropriately inserted as provided in Section 2.01 of the
Original Indenture.
[FORM OF SENIOR NOTE SERIES E BONDS]
JERSEY CENTRAL POWER & LIGHT COMPANY
FIRST MORTGAGE BOND, SENIOR NOTE SERIES E
$-------------- No. -------
Issue Date Interest Rate Maturity Date
- ---------- ------------- -------------
Interest Payment Dates:
-10-
<PAGE>
JERSEY CENTRAL POWER & LIGHT COMPANY, a corporation organized and existing
under the laws of the State of New Jersey (hereinafter called the "Company"),
for value received, hereby promises to pay to United States Trust Company of New
York, as Trustee under the Company's Indenture dated as of October 1, 1999, or
registered assigns, --------------- Dollars on the Maturity Date specified
above, unless this Bond shall have been duly called for previous redemption in
whole or in part and payment of the redemption price shall have been duly made
or provided for, at the office or agency of the Company in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts, and to pay to the registered holder hereof interest
thereon, at said office or agency, in like coin or currency, from the Issue Date
specified above, or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, until said principal sum has been paid or
provided for, at the Interest Rate per annum specified above, on the Interest
Payment Dates specified above and on the maturity date specified above;
provided, however, if the Issue Date is between the record date for an Interest
Payment Date and the Interest Payment Date, interest payments will commence on
the second Interest Payment Date following the Issue Date; and, to the extent
permitted by law, to pay interest on overdue interest at the highest rate of
interest borne by any of the bonds outstanding under the Mortgage hereinafter
mentioned.
This bond is one of an issue of bonds of the Company (hereinafter referred
to as the "bonds"), not limited in principal amount except as provided in the
Mortgage hereinafter mentioned, which may mature at different times, may bear
interest at different rates, and may otherwise vary as in the Mortgage
hereinafter mentioned provided, and is one of a series known as its First
Mortgage Bonds, Senior Note Series E (herein called the "Senior Note Series E
Bonds"), all bonds issued and to be issued under and equally and ratably secured
(except insofar as any sinking fund or analogous fund, established in accordance
with the provisions of the Mortgage hereinafter mentioned, may afford additional
security for the bonds of any particular series) by an Indenture, dated as of
March 1, 1946, executed by the Company to City Bank Farmers Trust Company,
Trustee (herein, together with any indentures supplemental thereto, including,
but not by way of limitation, the Fifty-third Supplemental Indenture, dated as
of October 1, 1999, called the "Mortgage"), under which United States Trust
Company of New York is Successor Trustee (herein called the "Trustee"), to which
Mortgage reference is made for a description of the property mortgaged and
pledged, the nature and extent of the security, the rights and limitations of
rights of the holders of the bonds and of the Company in respect thereof, the
rights, duties and immunities of the Trustee, and the terms and conditions upon
which the bonds are, and are to be, issued and secured. The Senior Note Series E
Bonds are described in the Fifty-third Supplemental Indenture dated as of
October 1, 1999 between the Company and the Trustee (the "Fifty-third
Supplemental Indenture").
-11-
<PAGE>
Under an Indenture dated as of July 1, 1999 (hereinafter sometimes
referred to as the "Senior Note Indenture"), between the Company and United
Trust Company of New York, as trustee (hereinafter sometimes called the "Senior
Note Trustee"), the Company will issue, concurrently with the issuance of this
bond, an issue of notes under the Senior Note Indenture entitled Senior Notes,
Series E (the "Series E Notes"). Pursuant to Article IV of the Senior Note
Indenture, this bond is issued to the Senior Note Trustee to secure any and all
obligations of the Company under the Series E Notes and any other series of
senior notes from time to time outstanding under the Senior Note Indenture.
Payment of principal of, or premium, if any, or interest on, the Series E Notes
shall constitute payments on this bond as further provided herein and in the
Fifty-third Supplemental Indenture.
As provided in Section 4.09 of the Senior Note Indenture, from and after
the Release Date (as defined in the Senior Note Indenture), the obligations of
the Company with respect to this bond shall be deemed to be satisfied and
discharged, this bond shall cease to secure in any manner any senior notes
outstanding under the Senior Note Indenture, and, pursuant to Section 4.06 of
the Senior Note Indenture, the Senior Note Trustee shall forthwith deliver this
bond to the Company for cancellation.
Upon any payment of the principal of, premium, if any, and interest on,
all or any portion of the Series E Notes, whether at maturity or prior to
maturity by redemption or otherwise or upon provision for the payment thereof
having been made in accordance with Section 5.01(a) of the Senior Note
Indenture, Senior Note Series E Bonds in a principal amount equal to the
principal amount of such Series E Notes and having both a corresponding maturity
date and interest rate shall, to the extent of such payment of principal,
premium, if any, and interest, be deemed paid and the obligation of the Company
thereunder to make such payment shall be discharged to such extent and, in the
case of the payment of principal (and premium, if any), Senior Note Series E
Bonds in principal amount equal to the related Series E Notes shall be
surrendered to the Company for cancellation as provided in Section 4.06 of the
Senior Note Indenture. The Trustee may at anytime and all times conclusively
assume that the obligation of the Company to make payments with respect to the
principal of and premium, if any, and interest on the Senior Note Series E
Bonds, so far as such payments at the time have become due, has been fully
satisfied and discharged pursuant to the foregoing sentence unless and until the
Trustee shall have received a written notice from the Senior Note Trustee signed
by one of its officers stating (i) that timely payment of principal of, or
premium or interest on, the Series E Notes has not been made, (ii) that the
Company is in arrears as to the payments required to be made by it to the Senior
Note Trustee pursuant to the Senior Note Indenture, and (iii) the amount of the
arrearage.
For purposes of Section 4.07 of the Senior Note Indenture, this bond shall
be deemed to be the "Related Senior Note First Mortgage Bonds" in respect of the
Series E Notes.
-12-
<PAGE>
The Mortgage contains provisions permitting the holders of not less than
seventy-five per centum (75%) in principal amount of all the bonds at the time
outstanding, determined and evidenced as provided in the Mortgage, or in case
the rights under the Mortgage of the holders of bonds of one or more, but less
than all, of the series of bonds outstanding shall be affected, the holders of
not less than seventy-five per centum (75%) in principal amount of the
outstanding bonds of such one or more series affected, except that if any such
action would affect the bonds of two or more series, the holders of not less
than seventy-five per centum (75%) in principal amount of outstanding bonds of
such two or more series, which need not include seventy-five per centum (75%) in
principal amount of outstanding bonds of each of such series, determined and
evidenced as provided in the Mortgage, on behalf of the holders of all the
bonds, to waive any past default under the Mortgage and its consequences except
a completed default, as defined in the Mortgage, in respect of the payment of
the principal of or interest on any bond or except a default arising from the
creation of any lien ranking prior to or equal with the lien of the Mortgage on
any of the mortgaged property, subject to the condition that, in case the rights
of the holders of less than all of the series of bonds outstanding shall be
affected, no waiver of any past default or its consequences shall be effective
unless approved by the holders of not less than a majority of all the bonds at
the time outstanding. The Mortgage also contains provisions permitting the
Company and the Trustee, with the consent of the holders of not less than
seventy-five per centum (75%) in principal amount of all the bonds at the time
outstanding, determined and evidenced as provided in the Mortgage, or in case
the rights under the Mortgage of the holders of bonds of one or more, but less
than all, of the series of bonds outstanding shall be affected, then with the
consent of the holders of not less than seventy-five per centum (75%) in
principal amount of the outstanding bonds of such one or more series affected,
except that if any such action would affect the bonds of two or more series, the
holders of not less than seventy-five per centum (75%) in principal amount of
outstanding bonds of such two or more series, which need not include
seventy-five per centum (75%) in principal amount of outstanding bonds of each
of such series, determined and evidenced as provided in the Mortgage, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Mortgage or modifying in any manner the
rights of the holders of the bonds and coupons thereunto appertaining; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any bonds, or reduce the rate or extend the time of payment of interest
thereon, or reduce the principal amount thereof, or, subject to the provisions
of the Mortgage, limit the right of a bondholder to institute suit for the
enforcement of payment of principal or interest in accordance with the terms of
the bonds, without the consent of the holder of each bond so affected, or (ii)
reduce the aforesaid percentage of bonds, the holders of which are required to
consent to any such supplemental indenture, without the consent of the holders
of all bonds then outstanding, or (iii) permit the creation of any lien ranking
prior to or equal with the lien of the Mortgage on any of
-13-
<PAGE>
the mortgaged property without the consent of the holders of all bonds then
outstanding, or (iv) deprive the holder of any outstanding bond of the lien of
the Mortgage on any of the mortgaged property. Any such waiver or consent by the
holder of this bond (unless effectively revoked as provided in the Mortgage)
shall be conclusive and binding upon such holder and upon all future holders of
this bond, irrespective of whether or not any notation of such waiver or consent
is made upon this bond.
No reference herein to the Mortgage and no provision of this bond or of
the Mortgage shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this bond at
the time and place and at the rate and in the coin or currency herein
prescribed.
The Senior Note Series E Bonds are issuable only in fully registered form
and in denominations of $1,000 or any higher integral multiple of $1,000.
Senior Note Series E Bonds shall not be redeemed except as set forth below
and except by the surrender thereof by the Senior Note Trustee to the Trustee
for cancellation at a redemption price of zero upon redemption of all other
series of bonds pursuant to Section 8.08 of the Mortgage. In the event the
Company redeems any Series E Notes prior to maturity in accordance with the
provisions of the Senior Note Indenture, the Senior Note Trustee shall on the
same date deliver to the Company Senior Note Series E Bonds in principal amounts
corresponding to the Series E Notes so redeemed, as provided in Section 4.06 of
the Senior Note Indenture. Senior Note Series E Bonds are not redeemable by the
operation of the improvement fund pursuant to Section 5.22 and Section 9.06 of
the Indenture or otherwise or by operation of the maintenance and replacement
provisions of Section 5.07 and Section 9.06 of the Indenture or otherwise or
with the proceeds of released property pursuant to Section 9.06 of the Indenture
or otherwise.
The Senior Note Series E Bonds shall be immediately redeemed at a
redemption price of 100% of the principal amount thereof, plus interest accrued
to the redemption date, in whole, upon a written demand for redemption by the
Senior Note Trustee stating that the principal of all Senior Notes then
outstanding under the Senior Note Indenture have been declared to be immediately
due and payable pursuant to the provisions of the first sentence of Section
8.01(a) thereof.
The Mortgage provides that if the Company shall deposit with the Trustee
in trust for the purpose funds sufficient to pay the principal of all of the
bonds of any series, or such of the bonds of any series as have been or are to
be called for redemption, and premium, if any, thereon, and all interest payable
on such bonds to the date on which they become due and payable, at maturity or
upon redemption or otherwise, and complies with the other provisions of the
Mortgage in respect thereof, then from the date of such deposit such bonds shall
no longer be secured by the lien of the Mortgage.
-14-
<PAGE>
The principal hereof may be declared or may become due prior to the
express date of the maturity hereof on the conditions, in the manner and at the
time set forth in the Mortgage, upon the occurrence of a completed default as in
the Mortgage provided.
This bond is not transferable except (i) as required to effect an
assignment to a successor Trustee under the Senior Note Indenture, (ii) pursuant
to Section 4.03 or Section 4.06 of the Senior Note Indenture, or (iii) in
compliance with a final order of a court of competent jurisdiction in connection
with any bankruptcy or reorganization proceeding of the Company. This bond shall
be exchangeable for other registered bonds of the same series and for the same
aggregate principal amount, in the manner and upon the conditions prescribed in
the Mortgage, upon the surrender of such bonds at the office or agency of the
Company in the Borough of Manhattan, the City of New York. However,
notwithstanding the provisions of Section 2.03 of the Mortgage, no charge shall
be made upon any registration of transfer or exchange of bonds of said series.
The Company and the Trustee, any paying agent and any bond registrar may deem
and treat the person in whose name this bond is registered as the absolute owner
hereof, whether or not this bond shall be overdue, for the purpose of receiving
payment and for all other purposes and neither the Company nor the Trustee nor
any paying agent nor any bond registrar shall be affected by any notice to the
contrary.
No recourse under or upon any obligation, covenant or agreement contained
in the Mortgage, or in any bond or coupon thereby secured, or because of any
indebtedness thereby secured, shall be had against any incorporator, or against
any past, present or future stockholder, officer or director, as such, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation under any rule of law, statute or constitution, or
by the enforcement of any assessment or by any legal or equitable proceeding or
otherwise; it being expressly agreed and understood that the Mortgage, and the
obligations thereby secured, are solely corporate obligations, and that no
personal liability whatever shall attach to, or be incurred by, such
incorporators, stockholders, officers or directors, as such, of the Company or
of any successor corporation, or any of them because of the incurring of the
indebtedness thereby authorized or under or by reason of any of the obligations,
covenants or agreements contained in the Mortgage or in any of the bonds or
coupons thereby secured, or implied therefrom.
This bond shall not become valid or obligatory for any purpose until
UNITED STATES TRUST COMPANY OF NEW YORK, the Trustee under the Mortgage, or its
successor thereunder, shall have signed the certificate of authentication
endorsed hereon.
IN WITNESS WHEREOF, JERSEY CENTRAL POWER & LIGHT COMPANY has caused this
bond to be signed in its name by the manual or facsimile signature of its
President or one of its Vice Presidents and its corporate seal, or a facsimile
thereof, to be
-15-
<PAGE>
affixed hereto and attested by the manual or facsimile signature of its
Secretary or one of its Assistant Secretaries.
Dated:
JERSEY CENTRAL POWER & LIGHT COMPANY
By: /s/ T. G. Howson
----------------------------------
T. G. Howson
Vice President and Treasurer
Attest:
- -------------------------
Assistant Secretary
-16-
<PAGE>
[FORM OF TRUSTEE'S CERTIFICATE]
TRUSTEE'S AUTHENTICATION CERTIFICATE
This bond is one of the bonds of the series herein designated, provided
for in the within-mentioned Mortgage.
UNITED STATES TRUST COMPANY OF NEW YORK
By: ------------------------------------
Authorized Officer
[END OF FORM OF SENIOR NOTE SERIES E BOND]
ARTICLE III.
MISCELLANEOUS
SECTION 3.01. For all purposes hereof, except as the context may otherwise
require, (a) all terms contained herein shall have the meanings given such terms
in, and (b) all references herein to sections of the Original Indenture shall be
deemed to be to such sections of, the Original Indenture as the same heretofore
has been or hereafter may be amended by an indenture or indentures supplemental
thereto.
SECTION 3.02. As amended and supplemented by the aforesaid indentures
supplemental thereto and by this Fifty-third Supplemental Indenture, the
Original Indenture is in all respects ratified and confirmed and the Original
Indenture and the aforesaid indentures supplemental thereto and this Fifty-third
Supplemental Indenture shall be read, taken and construed as one and the same
instrument.
SECTION 3.03. This Fifty-third Supplemental Indenture shall be
simultaneously executed in several counterparts, and all such counterparts
executed and delivered, each as an original, shall constitute but one and the
same instrument.
IN WITNESS WHEREOF, JERSEY CENTRAL POWER & LIGHT COMPANY, party of the
first part, has caused this instrument to be signed in its name and behalf by
its President or a Vice President, and its corporate seal to be hereunto affixed
and attested by its Secretary or an Assistant Secretary and United States Trust
Company of New York, as Successor Trustee as aforesaid, the party of the second
part, in token of its acceptance of the trust hereby created, has caused this
instrument to be signed in its name and behalf by an Authorized Officer and its
corporate seal to be hereunto affixed
-17-
<PAGE>
and attested by an Authorized Officer, all as of the day and year first above
written.
JERSEY CENTRAL POWER & LIGHT COMPANY
By:------------------------------------
(Vice) President
ATTEST:
- ------------------------------------
(Assistant) Secretary
Signed, sealed and delivered by
JERSEY CENTRAL POWER & LIGHT COMPANY
in the presence of:
- ------------------------------------
- ------------------------------------
UNITED STATES TRUST COMPANY
OF NEW YORK
As Successor Trustee as aforesaid
By:------------------------------------
Vice President
ATTEST:
Assistant Secretary
- ------------------------------------
Signed, sealed and delivered by
UNITED STATES TRUST COMPANY
OF NEW YORK in the presence of:
- ------------------------------------
- ------------------------------------
-18-
<PAGE>
STATE OF NEW JERSEY )
ss.:
COUNTY OF MORRIS )
BE IT REMEMBERED that on this ----------- day of ------, 1999 before me,
the subscriber, a notary public in and for said County and State, personally
appeared ,----------------an (Assistant) Secretary of JERSEY CENTRAL POWER &
LIGHT COMPANY, the corporation named in and which executed the foregoing
instrument, who, being by me duly sworn according to law, does depose and say
and make proof to my satisfaction that he resides at ------------------------- ;
that she is an (Assistant) Secretary of JERSEY CENTRAL POWER & LIGHT COMPANY;
that the seal affixed to said instrument is the corporate seal of said
corporation, the same being well known to him; that it was so affixed by the
order of the Board of Directors of said corporation; that ------------------- is
a Vice President of said corporation; that he saw said ----------------------as
such Vice President sign such instrument, and affix said seal thereto and
deliver said instrument and heard him declare that he signed, sealed and
delivered said instrument as the voluntary act and deed of said corporation by
its order and by order of its Board of Directors, for the uses and purposes
therein expressed; and that the said------------------ signed her name thereto
at the same time as subscribing witness, and that Jersey Central Power & Light
Company, the mortgagor, has received a true copy of said instrument.
------------------------------------
(Assistant) Secretary
Subscribed and sworn to
before me the day and
year aforesaid
[NOTARIAL SEAL]
-19-
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED that on this --------------- day of -----------, 1999
before me, the subscriber, a notary public in and for said County and State,
personally appeared ------------------, an Assistant Secretary of UNITED STATES
TRUST COMPANY OF NEW YORK, the corporation named in and which executed the
foregoing instrument, who, being by me duly sworn according to law, does depose
and say and make proof to my satisfaction that he resides at
- ---------------------------; that he is an Assistant Secretary of UNITED STATES
TRUST COMPANY OF NEW YORK; that the seal affixed to said instrument is the
corporate seal of said corporation, the same being well known to him; that it
was so affixed by him pursuant to authority granted by the Board of Directors of
said corporation; that ----------------- is a Vice President of said
corporation; that he saw said ----------------- as such Vice President sign and
deliver said instrument and heard him declare that he signed and delivered said
instrument as the voluntary act and deed of said corporation pursuant to
authority granted by its Board of Directors, for the uses and purposes therein
expressed; and that the said --------------- signed his name thereto at the same
time as subscribing witness.
Assistant Secretary
------------------------------------
Subscribed and sworn to
before me the day and
year aforesaid
------------------------------------
[NOTARIAL SEAL]
-20-
<PAGE>
STATE OF NEW JERSEY )
ss.:
COUNTY OF MORRIS )
On this ----------- day of ----------, 1999, before me came T.G. Howson, to
me known, who, being by me duly sworn, did say that he resides at
- ------------------------------; that he is a (Vice) President of JERSEY CENTRAL
POWER & LIGHT COMPANY, one of the corporations described in and which executed
the above instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that said seal was so affixed
by order of the Board of Directors of said corporation; and that he signed his
name to said instrument by like order.
------------------------------------
Subscribed and sworn to
before me the day and
year aforesaid
[NOTARIAL SEAL]
-21-
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this ------------ day of -----------, 1999, before me came
- ------------------------, to me known, who, being by me duly sworn, did say that
he resides at -----------------------------; that he is a Vice President of
UNITED STATES TRUST COMPANY OF NEW YORK, one of the corporations described in
and which executed the above instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that said seal was so affixed by authority of the Board of Directors of said
corporation; and that he signed his name to said instrument by like authority.
Subscribed and sworn to
before me the day and
year aforesaid
------------------------------------
[NOTARIAL SEAL]
-22-
<PAGE>
CERTIFICATE OF RESIDENCE
------------------------
United States Trust Company of New York, Successor Trustee within named,
hereby certifies that its precise residence is 114 West 47th Street, in the
Borough of Manhattan, in the City of New York, in the State of New York.
UNITED STATES TRUST COMPANY OF NEW YORK
By: ------------------------------------
Vice President
-23-
<PAGE>
-----------------------------------
Executed in 50 Counterparts of which
this is Counterpart No. ------
-----------------------------------
-------------------------------------------------------
MORTGAGE
JERSEY CENTRAL POWER & LIGHT COMPANY
to
UNITED STATES TRUST COMPANY OF NEW YORK,
Successor Trustee
---------------------
FIFTY-THIRD SUPPLEMENTAL INDENTURE
FIRST MORTGAGE BONDS,
DESIGNATED SENIOR NOTE SERIES E BONDS
---------------------
Dated as of October 1, 1999
--------------------------------------------------------
This instrument prepared by:
-----------------------
Marc B. Lasky, Esq.
<PAGE>
TABLE OF CONTENTS
PARTIES........................................................... 1
RECITALS.......................................................... 1
GRANT............................................................. 5
EXCEPTED PROPERTY................................................. 5
GENERAL SUBJECT CLAUSES........................................... 6
ARTICLE I.
CONCERNING THE TRUSTEE
SECTION 1.01 Acceptance by Trustee of Property
in Trust........................................ 6
SECTION 1.02 Recitals by Company............................. 6
ARTICLE II.
CREATION, DESCRIPTION AND FORM OF THE SENIOR NOTE SERIES E BONDS
SECTION 2.01 Creation of Senior Note Series E
Bonds........................................... 6
SECTION 2.02 $200,000,000 of Senior Note Series E
Bonds issuable.................................. 6
SECTION 2.03 Dating, maturity and payment of
principal and interest of Senior
Note Series E Bonds............................. 7
SECTION 2.04 Payment on Series E Notes
sufficient...................................... 8
SECTION 2.05 Registered in name of Senior Note
Trustee......................................... 9
SECTION 2.06 Senior Note Series E Bonds not
transferable.................................... 9
SECTION 2.07 Redemption provisions........................... 9
SECTION 2.08 Redemption on demand of Senior
Note Trustee.................................... 9
SECTION 2.09 Senior Note Series E Bonds as
"Related Senior Note First
Mortgage Bonds"................................. 10
SECTION 2.10 Surrender of Senior Note Series E
Bonds........................................... 10
-i-
<PAGE>
SECTION 2.11 Discharge from and after Release
Date............................................ 10
SECTION 2.12 Form of Senior Note Series E Bonds.............. 10
ARTICLE III.
MISCELLANEOUS
SECTION 3.01 Meaning of Certain Terms........................ 17
SECTION 3.02 Original Indenture and
Supplemental Indentures Ratified
and Confirmed................................... 17
SECTION 3.03 Execution in Counterparts....................... 17
TESTIMONIUM ................................................ 17
SIGNATURES AND SEALS.............................................. 18
ACKNOWLEDGMENTS ................................................ 19
CERTIFICATE OF RESIDENCE.......................................... 23
-ii-
EXHIBIT 5
[Berlack, Israels & Liberman LLP Letterhead]
October 12, 1999
Jersey Central Power & Light Company
2800 Pottsville Pike
Reading, Pennsylvania 19605
Re: Registration Statement on Form S-3
----------------------------------
Ladies and Gentlemen:
Jersey Central Power & Light Company (the "Company") has filed with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "1933 Act"), a Registration Statement on Form S-3
(the "Registration Statement"), dated today's date, of which this opinion is to
be a part. The Registration Statement relates to the proposed issuance and sale
by the Company of up to $200,000,000 aggregate principal amount of senior notes
("Senior Notes") and, pursuant to Rule 429, includes a combined prospectus for
the $200,000,000 of Senior Notes which are the subject of the Registration
Statement and $100,000,000 of senior notes previously registered in Registration
No. 333-78717. The Senior Notes are to be issued by the Company pursuant to an
indenture between the Company and United States Trust Company of New York, as
Trustee (the "Senior Note Indenture"). The Senior Notes will be secured by first
mortgage bonds until a release date.
We have been counsel to the Company for many years. In such
capacity, we are familiar with the affairs of the Company and the transactions
that are the subject matter of the Registration Statement. We have examined such
corporate records of the Company and such other instruments, documents,
certificates and agreements, including the form of Senior Note Indenture, and
made such further investigation as we have deemed necessary as a basis for this
opinion.
For the purposes of this opinion, we have assumed that (1) the
proposed transactions are carried out on the basis set forth in the Registration
Statement and in conformity with the requisite authorizations, approvals,
consents or exemptions under the securities laws of the various States and other
jurisdictions of the United States, (2) all necessary corporate action required
<PAGE>
Jersey Central Power & Light Company
October 12, 1999
Page 2
on the part of the Company shall have been duly taken, (3) the Commission shall
have issued an order declaring the Registration Statement effective under the
1933 Act, and (4) the issuance and sale of the Senior Notes do not violate
Section 12(f) of the Public Utility Holding Company Act of 1935, as amended, or
Rule 70 thereunder.
Based upon the foregoing, we are of the opinion that, subject to the
foregoing assumptions and qualifications, when properly authenticated and
delivered by the Trustee under the Senior Note Indenture, the Senior Notes will
be legally issued and will be binding obligations of the Company, subject to
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other laws affecting creditors' rights generally (including,
without limitation, the Atomic Energy Act and applicable regulations of the
Nuclear Regulatory Commission thereunder) and general equitable principles.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and as a part thereof. We also consent to the reference
to our firm under "Legal Matters" in the Prospectus which is a part of the
Registration Statement.
Very truly yours,
BERLACK, ISRAELS & LIBERMAN LLP
Exhibit 12B
JERSEY CENTRAL POWER & LIGHT COMPANY AND SUBSIDIARY COMPANY
STATEMENTS SHOWING COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
BASED ON SEC REGULATION S-K, ITEM 503
(In Thousands)
UNAUDITED
Twelve
Months Ended
June 30,
1999
-------------
OPERATING REVENUES $2,026,334
----------
OPERATING EXPENSES 1,642,931
Interest portion of rentals (A) 14,276
----------
Net expense 1,628,655
----------
OTHER INCOME AND DEDUCTIONS:
Allowance for funds used
during construction 1,847
Other income, net 15,791
----------
Total other income and deductions 17,638
----------
EARNINGS AVAILABLE FOR FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS
(excluding taxes based on income) $ 415,317
==========
FIXED CHARGES:
Interest on funded indebtedness $ 87,232
Other interest (B) 21,856
Interest portion of rentals (A) 14,276
----------
Total fixed charges $ 123,364
==========
RATIO OF EARNINGS TO FIXED CHARGES 3.37
====
NOTES:
(A) JCP&L has included the equivalent of the interest portion of all rentals
charged to income as fixed charges for this statement and has excluded
such components from Operating Expenses.
(B) Includes dividends on company-obligated mandatorily redeemable preferred
securities of $10,700 for the twelve month period ended June 30, 1999.
Exhibit 23-B
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
Jersey Central Power and Light Company (the "Company") on Form S-3 of our
report, dated February 3, 1999, on our audits of the consolidated financial
statements and financial statement schedule of Jersey Central Power and Light
Company as of December 31, 1998 and 1997, and for each of the three years in the
period ended December 31, 1998, which report is included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1998. We also consent to the
reference to our Firm under the caption "Experts".
PricewaterhouseCoopers L.L.P.
Philadelphia, Pennsylvania
October 8, 1999
-2-
