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RULE NO. 424(b)(3)
REGISTRATION NO. 333-48781
PP&L RESOURCES, INC.
Dividend Reinvestment Plan [LOGO]
The Dividend Reinvestment Plan of PP&L Resources, Inc. provides participants
in the Plan with a convenient way of investing cash dividends and cash
payments in additional shares of our Common Stock.
Participants in the Plan may:
. have cash dividends on their Common Stock of PP&L Resources and their
Preferred Stock of PP&L, Inc. automatically reinvested in shares of our
Common Stock.
. invest optional cash payments on a monthly basis of up to $80,000 in a
calendar year. Shares purchased with optional cash payments received by
the 25th day of a month will be credited to a participant's account as
of the first business day of the following month.
. transfer shares of our Common Stock registered in their names to their
Plan accounts for safekeeping.
In addition, employees of PP&L and some of our other subsidiaries may invest
in shares of our Common Stock through automatic payroll deductions and through
optional cash payments.
The price for newly issued shares of Common Stock will be the average of the
high and low sale prices of the Common Stock on the investment date. The price
for shares of Common Stock purchased in the open market or from participants
who wish to sell their shares will be determined by dividing the total cost of
all shares purchased by the number of shares so purchased. See Questions #16
and #17 herein for additional information concerning the calculation of the
price for shares purchased under the Plan.
Shareowners who do not wish to participate in the Plan will receive
dividends, as declared, in the usual manner. The dividend policy of PP&L
Resources will depend upon future earnings, financial requirements and other
factors.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus supplement. Nor have they made, nor
will they make, any determination as to whether anyone should buy these
securities. Any representation to the contrary is a criminal offense.
The date of this Prospectus is May 21, 1999.
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AVAILABLE INFORMATION
PP&L Resources and PP&L are subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith will file reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information filed by PP&L Resources and PP&L can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the following Regional Offices of the Commission: Chicago Regional Office, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661; and New York Regional
Office, Seven World Trade Center, Suite 1300, New York, New York 10048. Copies
of this material can also be obtained by mail from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. The Commission also maintains a worldwide web site (http://
www. sec. gov) that contains reports, proxy and information statements and other
information filed by PP&L Resources and PP&L. The Common Stock of PP&L Resources
and certain series of Preferred Stock of PP&L are listed on the New York Stock
Exchange and the Philadelphia Stock Exchange. Reports, proxy statements and
other information concerning PP&L Resources and PP&L can be inspected and copied
at the respective offices of those exchanges at 20 Broad Street, New York, New
York 10005, and at 1900 Market Street, Philadelphia, Pennsylvania 19103. In
addition, reports, proxy statements and other information concerning PP&L
Resources and PP&L can be inspected at the offices of PP&L, Two North Ninth
Street, Allentown, Pennsylvania 18101.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are incorporated herein by reference and made a
part hereof:
1. PP&L Resources' Annual Report on Form 10-K for the year ended December
31, 1998.
2. PP&L Resources' Quarterly Report on Form 10-Q for the quarter ended March
31, 1999.
3. PP&L Resources' Current Reports on Form 8-K dated February 18, 1999,
March 11, 1999 and April 23, 1999.
4. The "Description of Registrant's Securities to be Registered,"
contained in Item 4 of the Registration Statement on Form 8-B of
PP&L Resources relating to the Common Stock.
All documents filed by PP&L Resources pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of this
Prospectus and prior to the termination of the offering made by this Prospectus
shall be deemed to be incorporated by reference in this Prospectus and to be a
part hereof from the date of filing of such documents (such documents, and the
documents enumerated above, being hereinafter referred to as "Incorporated
Documents"). Any statement contained in an Incorporated Document shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed Incorporated
Document modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Copies of the incorporated documents (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference
therein) will be furnished upon request without charge to each person
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to whom this prospectus is delivered. Written or telephone requests should be
directed to PP&L, Inc., TwoNorth Ninth Street, Allentown, PA 18101, Attention:
Investor Services Department (800/345-3085). You may also contact the Investor
Services Department via e-mail at [email protected].
GENDER REFERENCE
References herein to "he," "him," and "his" include the feminine forms
of such terms.
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THE COMPANY
PP&L Resources is a holding company with headquarters in Allentown, PA.
Our subsidiaries include PP&L, Inc.,which delivers electricity to 1.3 million
customers in eastern and central Pennsylvania, generates electricity and markets
wholesale energy in the United States and in Canada; PP&L EnergyPlus Co., which
sells competitively priced energy and energy services to newly deregulated
markets; PP&L Global, Inc., which develops electric generation throughout the
United States and around the world and has investments in United Kingdom and
Latin American companies that distribute electricity to 2 million customers;
PP&L Spectrum, Inc., which markets energy-management services and products; Penn
Fuel Gas, Inc., which sells and distributes natural gas and propane in
Pennsylvania and Maryland; and Burns Mechanical, Inc., H.T. Lyons, Inc.,
McCarl's Inc. and McClure Company, which are mechanical contracting and
engineering firms that provide services in the mid-Atlantic region.
Our offices are located at Two North Ninth Street, Allentown,
Pennsylvania 18101, and our telephone number is (610) 774-5151.
DESCRIPTION OF THE PLAN
The following is a question and answer description of the Dividend
Reinvestment Plan of PP&L Resources.
PURPOSE
1. What is the purpose of the Plan?
The purpose of the Plan is to provide participants with a convenient
way of investing cash dividends on shares of Common Stock of PP&L Resources and
Preferred Stock of PP&L and cash payments in additional shares of Common Stock
of PP&L Resources.
Under the terms of their respective articles of incorporation, PP&L
Resources is authorized to issue Preferred Stock in series from time to time and
PP&L is authorized to issue Preference Stock in series from time to time in
addition to its Preferred Stock. In the event that PP&L Resources issues
Preferred Stock or PP&L issues Preference Stock in the future, the dividends
paid on those shares may be reinvested pursuant to the Plan in additional shares
of Common Stock of PP&L Resources. For convenience, throughout the balance of
this Prospectus, the term "Preferred Stock" means the Preferred Stock of PP&L
Resources and the Preferred and Preference Stock of PP&L, and the term "Common
Stock" means the Common Stock of PP&L Resources.
Specifically, participants in the Plan may (a) have cash dividends on
their shares of Preferred Stock and Common Stock automatically reinvested in
Common Stock or (b) continue to receive cash dividends on shares registered in
their names and invest by making optional cash payments of up to $80,000 in a
calendar year or (c) invest both their cash dividends and such optional cash
payments. In addition, employees of PP&L and certain other subsidiaries of PP&L
Resources may invest in shares of Common Stock through automatic
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payroll deductions and through optional cash payments. Full investment of funds
is possible under the Plan because the Plan permits fractions of shares, as well
as full shares, to be credited to participants' accounts. In addition,
dividends with respect to such fractions, as well as full shares, will be
credited to participants' accounts. Regular Statements of Account provide each
participant with a record of each transaction.
Shares purchased through the Plan will, at the option of PP&L
Resources, be either newly issued shares of Common Stock, shares purchased in
the open market or shares purchased from participants who wish to sell their
shares. To the extent that shares of Common Stock purchased with reinvested
dividends, optional cash payments or employee payroll deductions are purchased
from PP&L Resources as newly issued shares, PP&L Resources will have available
funds for its general corporate purposes.
The Plan permits participants to avoid the problems of safekeeping of
certificates for shares of Common Stock credited to their Plan accounts. In
addition, participants may transfer to their Plan accounts for safekeeping
shares of Common Stock registered in their names. See Question #23 for
information concerning the certificate safekeeping features of the Plan.
The Plan also provides a convenient method for participants to dispose
of shares of Common Stock held in their accounts under the Plan. See Questions
#27 and #28 for additional information concerning the disposition of shares
credited to participants' accounts.
There are currently no service charges to participants in connection
with purchases under the Plan or other features of the Plan, although such
charges may exist in the future. Brokerage commissions incurred in connection
with the purchase of shares of Common Stock in the open market currently are
paid by PP&L Resources, but may be charged to participants in the future. See
Questions #16 and #17 for information concerning the possibility that interest
costs incurred by PP&L will be included in the purchase price paid by
participants if shares are acquired for the Plan in open market purchases in
advance of a dividend payment date or in advance of the receipt by PP&L of
optional cash payments or payroll deductions.
ADMINISTRATION
2. Who administers the Plan for participants?
PP&L administers the Plan on behalf of PP&L Resources, keeps records,
sends quarterly (or more frequent) Statements of Account to participants and
performs other duties relating to the Plan. Purchases of shares of Common Stock
in the open market will be made by a broker selected by PP&L. Shares of Common
Stock purchased under the Plan will be registered in the name of PP&L, as agent
for participants in the Plan, and allocated to participants' accounts.
Questions concerning a participant's account under the Plan should be
addressed to PP&L, Inc.'s Investor Services Department, Two North Ninth Street,
Allentown, PA 18101. Participants can also call the Investor Services Department
toll-free at 800/345-3085 if they have questions about their accounts or contact
the Investor Services Department via E-mail at [email protected]. Participants
who are employees of subsidiaries located outside of the United States may be
given the name of a local plan administrator within their company or locally
situated who can answer questions about their accounts.
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PARTICIPATION
3. Who is eligible to participate in the Plan?
All holders of record of shares of Common Stock and Preferred Stock are
eligible to participate in the Plan. To be eligible to participate in the Plan,
beneficial owners whose only shares are registered in names other than their
own--such as a trustee or broker or bank nominee--must first become holders of
record by having their shares transferred into their names unless such trustee
or broker or bank nominee participates in the Plan. See Question # 5 for
information concerning participation in the Plan by nominee holders.
Employees of PP&L and certain other subsidiaries of PP&L Resources are
eligible to participate in the Plan through automatic payroll deductions and/or
optional cash payments even though they do not have any shares registered in
their names. Those employee participants who are not residents or citizens of
the United States are eligible to participate in the Plan only if their
participation would not violate any applicable local laws.
PARTICIPATION BY SHAREOWNERS
4. How does a shareowner participate?
A shareowner who is not currently participating may join the Plan at
any time by completing an Authorization Form and returning it to PP&L. If the
Authorization Form returned by a shareowner entitled to a dividend is received
by PP&L on or before the 10th day of the month prior to the payment date for a
particular dividend, that dividend will be used to purchase additional shares of
Common Stock for the shareowner. If the Authorization Form is received by PP&L
after the 10th day of the month prior to the payment date for a particular
dividend, then the reinvestment of dividends will not begin until the next
dividend. For example, in order to invest the quarterly dividend payable on
October 1, a shareowner's Authorization Form must be received by PP&L no later
than September 10. If the Authorization Form is received after September 10, the
dividend payable on October 1 will be paid in cash and the shareowner's
participation in the Plan will begin with the dividend payable on January 1.
Those shareowners who do not wish to participate in the Plan will
receive dividends, as declared, in the usual manner.
Current participants in the Plan who wish to continue their
participation in the Plan do not need to complete and return a new Authorization
Form.
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Authorization Forms may be obtained by contacting:
PP&L, Inc.
Investor Services Department
Two North Ninth Street
Allentown, PA 18101
1(800) 345-3085
[email protected]
5. What does the shareowner Authorization Form provide?
The shareowner Authorization Form allows each shareowner to decide the
extent to which he wants to participate in the Plan. By checking the appropriate
box on the Authorization Form, a shareowner may indicate whether he wants to (a)
reinvest dividends paid on shares of Common Stock registered in his name or (b)
reinvest dividends paid on shares of Preferred Stock registered in his name or
(c) reinvest dividends paid on both the shares of Common Stock and the shares of
Preferred Stock registered in his name or (d) participate in the Plan by making
optional cash payments only.
A nominee holder--such as a trustee, broker or bank--who wishes to
reinvest dividends on only a portion of the shares of Preferred Stock or Common
Stock registered in its name may obtain additional information and an
appropriate authorization card by writing to PP&L, Inc. Investor Services
Department, Two North Ninth Street, Allentown, PA 18101, by calling the Investor
Services Department toll-free at 800/345-3085 or by contacting the Investor
Services Department via e-mail at [email protected].
6. When will shares be purchased with reinvested dividends?
In the case of shares purchased in the open market or from participants
who wish to sell their shares, cash dividends, which are payable on the first
day of January, April, July and October, will be invested quarterly no later
than the 10th day after the dividend payment date, subject to any applicable
requirements of Federal securities laws affecting the timing and manner of
purchases of Common Stock for the Plan.
By completing the purchase of shares by the 10th day of the month in
which a dividend is paid, PP&L will be able to inform participants on a timely
basis of the relevant information concerning their investment in the Common
Stock. In acquiring Common Stock for the Plan through market purchases, the
number of shares that can be purchased in the market on a particular day may be
limited by Federal securities law and market considerations. As a result, it may
be necessary to purchase a portion of the shares needed to meet reinvested
dividends in advance of a dividend payment date to be able to provide Statements
of Account to participants on a timely basis. The exact timing of purchases made
in advance of a dividend payment date as well as the number of shares so
purchased will depend upon the amount of dividends expected to be reinvested as
well as Federal securities law and market considerations.
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In the case of newly issued shares of Common Stock, the investment date
for dividends will be the first day of January, April, July and October on which
the New York Stock Exchange is open for trading.
OPTIONAL CASH PAYMENTS
7. Who is eligible to make optional cash payments?
Participants who have submitted a signed Authorization Form, whether or
not they have authorized the reinvestment of dividends or, in the case of
employees, automatic payroll deductions, are eligible to make optional cash
payments.
If a shareowner participant chooses to participate by optional cash
payments only, cash dividends will be paid on shares registered in the
participant's name in the usual manner, and any optional cash payment received
from the participant will be applied to the purchase of additional shares of
Common Stock for the participant's account. If an employee participant chooses
to participate by optional cash payments only, payroll deductions will not be
made and any optional cash payment received from the participant will be applied
to the purchase of additional shares of Common Stock for the participant's
account. In either case, however, and subject to a participant's election to
receive in cash a specified percentage of dividends on shares in the
participant's Plan account as described in Question #18, dividends payable on
shares of Common Stock credited to the account of the participant under the Plan
will be automatically reinvested in additional shares of Common Stock.
An initial optional cash payment may be made by a participant when
enrolling by enclosing a check with the Authorization Form. Checks should be
made payable, in U.S. dollars, to "PP&L, Agent" and returned along with the
Authorization Form in the envelope provided. Thereafter, optional cash payments
may be invested by the use of the cash payment form attached to each Statement
of Account sent to participants.
8. What are the limitations on making optional cash payments?
The option to make cash payments is available to each participant at
any time. Optional cash payments made by a participant must be in U.S. dollars
and cannot exceed a total of $80,000 in a calendar year. Optional cash payments
must be received by PP&L by the 25th day of a month to be invested as of the
first business day of the following month. The same amount of money need not be
sent each month or quarter, and there is no obligation to make an optional cash
payment each month or quarter.
9. When will shares be purchased with optional cash payments?
Optional cash payments will be invested monthly.
In the case of shares purchased in the open market or from participants
who wish to sell their shares, such investment will be made no later than the
10th day of the month following the month in which such payments
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are received, or deemed to be received, by PP&L, subject to any applicable
requirements of Federal securities laws affecting the timing and manner of
purchases of Common Stock for the Plan.
By completing the purchase of shares by the 10th day of the month
following the month in which optional cash payments are received, PP&L will be
able to inform participants on a timely basis of the relevant information
concerning their investment in the Common Stock. In acquiring Common Stock for
the Plan through market purchases, the number of shares that can be purchased in
the market on a particular day may be limited by Federal securities law and
market considerations. As a result, it may be necessary to purchase a portion of
the shares needed to meet optional cash payments in advance of the time such
cash payments are received by PP&L to be able to provide Statements of Account
to participants on a timely basis. The exact timing of purchases made in advance
of the receipt of optional cash payments as well as the number of shares so
purchased will depend upon the amount of cash payments expected to be invested
as well as Federal securities law and market considerations.
In the case of newly issued shares of Common Stock, the investment date
for optional cash payments will be the first day in each month on which the New
York Stock Exchange is open for trading.
Optional cash payments received after the 25th day of a month will be
deemed to have been received in, and held by PP&L until, the next month. Since
no interest will be paid on optional cash payments, you are strongly urged to
make your optional cash payments shortly before the 25th day of the month.
However, you should allow sufficient time to ensure that your optional cash
payment will be received by the 25th day of the month. If the 25th day of the
month is a Saturday, Sunday or holiday, the deadline for the receipt of optional
cash payments will be the next business day after the 25th day of such month.
Optional cash payments will be refunded if a written request for refund
is received by PP&L on or before the last day of the month. If the last day of
the month is a Saturday, Sunday or holiday, the deadline for the receipt of a
refund request will be the last business day of such month.
OPENING NEW ACCOUNTS
10. Can a shareowner open a new account in the name of another person?
Yes. A shareowner may direct PP&L to open a new account in the name of
any other person--for example, a family member. To open the account, the
participant simply submits a New Account Form, with the name and signature of
the participant and the name, address, social security number and signature of
the person for whom the new account is being opened, along with a check for the
initial optional cash payment. The initial optional cash payment to the new
account is subject to the limitations described in Question #8 and will be
invested in accordance with Question #9. At that time, the designated person
will become a full participant in the Plan.
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PARTICIPATION BY EMPLOYEES
11. How does an employee participate?
An employee may join the Plan at any time by completing an
Authorization Form and returning it to PP&L. Participants who are employees of
subsidiaries located outside of the United States may be given the name of a
local plan administrator within their company or locally situated who will
assist them in joining the Plan.
12. What does the employee Authorization Form provide?
The employee Authorization Form allows each employee to decide the
extent to which he wants to participate in the Plan. By checking the appropriate
box on the Authorization Form, an employee may indicate whether he wants to (a)
invest in shares of Common Stock through automatic payroll deductions on the
PP&L payroll system and/or (b) participate in the Plan by making optional cash
payments only.
13. What about payroll deductions?
Investing in shares of Common Stock through automatic payroll
deductions will only be available to employees who are paid through the PP&L
payroll system. Those employees who are not paid through the PP&L payroll system
will be advised by their local plan administrator how investments should be
made.
Payroll deduction authorizations will be for an indefinite period of
time. The employee will specify on the Authorization Form the amount to be
withheld from his pay each month. The minimum monthly deduction is $2.00.
Payroll deductions will be invested monthly in the same manner as
optional cash payments. One-half of the deduction will be withheld from the
employee's pay for the first pay period ended in each month and the remainder
from the employee's pay for the second pay period ended in each month. In the
event that there is a third pay period in any month, no deduction will be made
for that pay period.
14. How do I change my payroll deduction?
The amount of payroll deduction can be revised, changed or terminated
at any time by written notice to PP&L, Inc., Investor Services Department, Two
North Ninth Street, Allentown, PA 18101 or by completing an Authorization Form
and returning it to PP&L. Commencement, revision or termination of deductions
will become effective as soon as practicable after an employee's request is
received by PP&L.
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PURCHASES
15. How many shares of Common Stock will be purchased for participants?
The number of shares to be purchased for the participant's account
depends on the amount of the participant's dividends, including dividends on
shares credited to the participant's account under the Plan, the amount of any
optional cash payments and the purchase price of the shares of Common Stock. In
the case of an employee participant, the number of shares to be purchased also
depends on the amount of the employee's payroll deduction. Each participant's
account will be credited with that number of shares, including fractions
computed to three decimal places, equal to the total amount to be invested
divided by the applicable purchase price.
16. What will be the price of shares of Common Stock purchased under the
Plan?
Shares of Common Stock purchased for Plan participants may be acquired
in the open market or from participants who wish to sell their shares. In
addition, shares of Common Stock purchased for Plan participants may be newly
issued shares of Common Stock.
Purchases of shares in the open market will be made at then current
market prices and may be made on any securities exchange where the Common Stock
is traded, in the over-the-counter market or in negotiated transactions and may
be on such terms as the broker selected by PP&L Resources for such purpose may
determine. Shares of Common Stock may also be purchased from Plan participants
as described in Questions #27 and #28.
The purchase price for shares acquired in the open market or from Plan
participants who wish to sell their shares will be the average price of all
shares purchased for the Plan (adjusted as described below). To the extent that
shares of Common Stock are purchased in advance of a dividend payment date or in
advance of the receipt by PP&L of optional cash payments or employee payroll
deductions, PP&L will advance the funds for those purchases through its normal
short-term borrowing facilities. In that event, the interest costs incurred by
PP&L (offset by any dividends payable on unallocated shares purchased for the
Plan prior to an ex-dividend date) will be allocated over the total number of
shares purchased with such reinvested dividends, optional cash payments or
employee payroll deductions and included in the price paid by participants.
The purchase price for newly issued shares of Common Stock will be the
average of the high and low sale prices of the Common Stock on the investment
date as reported by The Wall Street Journal (as composite transactions). If no
trading occurs in the Common Stock on the investment date, the purchase price
will be the average of the last bid and asked prices on the New York Stock
Exchange on that date.
17. What percentage of the purchase price may constitute interest costs
resulting from advance purchases of shares?
Assuming an estimated short-term interest rate for PP&L of 6.25% and an
estimated market price of $20 per share for the Common Stock, the interest cost
included in the purchase price paid by participants for shares
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acquired in the open market or from participants who desire to sell their shares
would be less than one cent per share for each day that such share is purchased
in advance. It is currently expected that purchases would not be made more than
25 days in advance. If purchases were made 25 days in advance and based on the
above assumptions, the interest cost that would be included in the purchase
price paid by participants would be less than 1% of the purchase price.
This example uses assumed numbers to put into perspective the interest
costs that could be included in the purchase price paid by participants. The
actual amount of interest included in the purchase price paid by participants
will depend upon the then current price of the Common Stock, the interest rates
incurred by PP&L for its short-term borrowings and the number of days that
purchases are made in advance.
The interest cost applicable to the purchase of shares under the Plan
will be calculated by PP&L and included in the price for shares, as reported on
each participant's Statement of Account. No separate payment will be required to
be made by participants for any such interest costs.
18. May I have dividends on shares held in the Plan sent directly to me?
Yes. A participant may elect to receive cash dividends on all or any
portion of shares of Common Stock held by PP&L for the account of a participant.
Cash dividends will be paid by check on the regular payment date for dividends
on the Common Stock on January 1, April 1, July 1 and October 1 of each year. As
an alternative to the receipt of a dividend check, the participant may arrange
to have such dividends directly deposited into a bank account selected by the
participant. Information concerning the direct deposit of dividends may be
obtained by contacting PP&L's Investor Services Department at the address,
toll-free telephone number or E-mail address shown below.
The election to receive a portion of a participant's Plan dividends in
cash may be made by sending a written request to PP&L, Inc., Investor Services
Department, Two North Ninth Street, Allentown, PA 18101, by calling the Investor
Services Department toll-free at 800/345-3085 or by contacting the Investor
Services Department via E-mail at [email protected]. Such request should specify
the portion of dividends paid on a participant's Plan shares--stated as a
percentage of such dividends to be received in cash. A request to receive a
specified dollar amount of dividends in cash or dividends with respect to a
specific number of shares will not be accepted. Once made, an election will
remain in effect until changed by the participant.
In the absence of receipt of notice from a participant to receive cash
dividends on all or any portion of the shares held in the participant's Plan
account, all dividends credited to that account will be reinvested.
Notice of such an election must be received by PP&L not later than the
10th day of the month preceding a dividend payment date to be effective for that
dividend payment date. For example, in order to receive a portion of the January
1 dividend in cash, notice of the participant's election specifying the
percentage of
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dividends to be received in cash must be received by PP&L by December 10. If
notice of such election is received after December 10, the dividend payable on
January 1 will be governed by any prior election made by the participant and the
new election will take effect beginning with the dividend payable on April 1. In
the case where the participant had not previously made such an election, all of
the participant's January 1 dividends will be reinvested.
This feature of the Plan also makes it possible for shareowners who
have Common Stock certificates registered in their names to have those
certificates transferred to the Plan for safekeeping and to continue to receive
quarterly dividends by check or direct deposit. See Question #23. To do so, the
shares represented by such certificates must be transferred to the participant's
account in the Plan accompanied by a request to receive in cash a specified
percentage of all dividends paid on the participant's Plan shares. Information
and the forms necessary to enroll in the safekeeping features of the Plan may be
obtained by contacting PP&L's Investor Services Department at the address,
toll-free telephone number or E-mail address shown above.
REPORTS TO PARTICIPANTS
19. How will participants be advised of their purchase of stock?
As soon as practicable after each purchase, a participant will receive
a Statement of Account. The Statements of Account are a participant's continuing
record of the cost of his purchases and should be retained for tax purposes. In
addition, each participant will receive copies of communications sent generally
to all shareowners of PP&L Resources.
DIVIDENDS
20. Will participants be credited with dividends on shares held in their
account under the Plan?
Yes. PP&L Resources and PP&L pay dividends, as declared, to the record
holders of all shares of their stock. As the record holder for participants,
PP&L, as agent, will receive dividends for all Plan shares held on the record
date. Subject to a participant's election to receive in cash a specified
percentage of dividends on shares in the participant's Plan account as described
in Question # 18, PP&L will credit dividends to participants on the basis of
full and fractional shares held in their accounts, and such dividends will be
reinvested in additional shares of Common Stock.
CERTIFICATES FOR SHARES
21. Will stock certificates be issued for shares of Common Stock
purchased?
Normally, certificates for shares of Common Stock purchased under the
Plan will not be issued to participants. The number of shares credited to an
account under the Plan, including shares transferred to
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a participant's account pursuant to the certificate safekeeping features of the
Plan, will be shown on the participant's Statement of Account. This additional
service protects against loss, theft or destruction of stock certificates.
Certificates for any number of shares up to the number of full shares
credited to an account under the Plan will be issued upon written request of a
participant who wishes to remain in the Plan. The form on the participant's
Statement of Account may be used for this purpose. The request should be mailed
to PP&L, Inc., Investor Services Department, Two North Ninth Street, Allentown,
PA 18101. Any remaining full shares and fractional shares will continue to be
credited to the participant's account.
Shares credited to the account of a participant under the Plan may not
be pledged. A participant who wishes to pledge such shares must request that
certificates for such shares be issued in his name.
Certificates for fractional shares will not be issued under any
circumstances.
22. In whose name will accounts be maintained and certificates registered
when issued?
Accounts for shareowner participants will be maintained in the
participants' names as shown on the shareowner records of PP&L Resources or PP&L
at the time the participants join the Plan. Accounts for employee participants
will be maintained in the name(s) indicated on the Authorization Form. When
issued, certificates for full shares will be registered in the account name.
Upon written request, certificates also can be registered and issued in
names other than the account name subject to compliance with any applicable laws
and the payment by the participant of any applicable taxes, provided that the
request bears the signature of the participant and the signature is guaranteed
by a financial institution which is a participant in a Medallion signature
guarantee program.
TRANSFER OF SHARES TO THE PLAN FOR SAFEKEEPING
23. May a participant transfer shares of Common Stock registered in his
name to his Plan account for safekeeping?
Yes. Participants may elect to have shares of Common Stock registered
in their names held by the Plan for safekeeping. To participate in the
safekeeping features of the Plan, Common Stock certificates must be forwarded
to, and registered in the name of, PP&L as agent for Plan participants. Shares
represented by such certificates will be credited to the participant's account
in the Plan. Subject to a participant's election to receive in cash a specified
percentage of dividends on shares in the participant's Plan account as described
in Question #18, dividends paid on all such shares of Common Stock must be
reinvested.
To take advantage of the certificate safekeeping features of the Plan,
a participant must submit the certificates to PP&L, together with a completed
Letter of Transmittal. The Letter of Transmittal, together with detailed
instructions, will be provided to participants upon request. Such request may be
made by writing to
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PP&L, Inc., Investor Services Department, Two North Ninth Street, Allentown, PA
18101, by calling the Investor Services Department toll-free at 800/345-3085 or
by contacting the Investor Services Department via E-mail at [email protected].
The method used to submit certificates for safekeeping is at the option
and risk of the participant. If certificates are mailed, insured registered mail
is suggested for the participant's protection. The certificates should not be
endorsed.
Shares of Common Stock held by the Plan for safekeeping are protected
against loss, theft and inadvertent destruction. Such shares may be withdrawn or
sold at any time in accordance with the procedures described in Questions #27
and #28.
The certificate safekeeping features apply only to Common Stock. Shares
of Preferred Stock are not eligible for the safekeeping features of the Plan.
CHANGING METHOD OF PARTICIPATION AND WITHDRAWAL
24. How does a participant change his method of participation?
A participant may change his method of participation at any time by
completing an Authorization Form and returning it to PP&L or by submitting a
written request to the address set forth in Question 4.
25. May a participant withdraw from the Plan?
Yes. The Plan is entirely voluntary and a participant may withdraw at any
time.
If the request to withdraw is received by PP&L on or before the last
day of the month, the amount of the dividend, any optional cash payment and,
where available, employee payroll deductions which would otherwise have been
invested will be paid as soon as practicable to the withdrawing participant.
Thereafter, all dividends will be paid in cash and no payroll deductions will be
made. A shareowner or employee may elect to re-enroll in the Plan at any time.
26. How does a participant withdraw from the Plan?
In order to withdraw from the Plan, a participant must notify PP&L in
writing that he wishes to withdraw. Written notice should be addressed to PP&L,
Inc., Investor Services Department, Two North Ninth Street, Allentown, PA 18101.
Written notice may also be provided by completing the form on the Statement of
Account and returning that form to PP&L.
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27. What options are available to a participant who withdraws from the
Plan?
Upon withdrawing from the Plan, a participant may elect to:
(a) receive a certificate for all of the full shares credited to his account
in the Plan and a check for any fractional share; or
(b) request that all of
the full and any fractional shares credited to his account in the Plan be
sold; or
(c) receive a certificate for any portion of the full shares credited to his
account and sell any shares (both full and fractional) remaining in his
account in the Plan after the certificate is issued.
The withdrawing participant must notify PP&L in writing of his election. The
form on the participant's Statement of Account may be used for this purpose.
If a participant elects to receive a certificate for all of the full
shares credited to his account in the Plan, the check for any fractional share
will be based on the sale price of the fractional share.
If a withdrawing participant requests that his full and fractional
shares be sold, unless such shares are needed to meet Plan requirements, PP&L
will place a sale order for such shares for the participant's account through a
fiduciary institution selected by PP&L. The participant will receive the
proceeds of the sale less any brokerage commission and any applicable transfer
tax.
From time to time, shares being sold by withdrawing participants may be
needed to meet Plan requirements. In that event, the withdrawing participant's
full and fractional shares will be purchased by the Plan. The price paid to the
withdrawing participant will be equal to the average of the high and low sale
prices of the Common Stock on the trading day immediately prior to the
processing of the participant's request by PP&L, as reported by The Wall Street
Journal (as composite transactions). The participant will receive the proceeds
of the sale less any applicable transfer tax. There will be no brokerage
commissions charged in connection with such sales. At such times as PP&L
Resources elects to meet Plan requirements with newly issued shares of Common
Stock, a participant's full or fractional shares will not be purchased for the
Plan. In those circumstances, sales of a withdrawing participant's shares will
be handled only in the manner described in the preceding paragraph.
28. May a participant request that shares held in his Plan account be sold
without withdrawing from the Plan?
Yes. A participant may, if he desires, request in writing that all or
any part of the full (but not fractional) shares credited to his account in the
Plan be sold without such participant having to withdraw from the Plan. The form
on the participant's Statement of Account may be used for this purpose.
If a participant requests that his full shares be sold, unless such
shares are needed to meet Plan requirements, PP&L will place a sale order for
such shares for the participant's account through a fiduciary institution
selected by PP&L. The participant will receive the proceeds of the sale less any
brokerage commission and any applicable transfer tax.
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From time to time, shares being sold by participants may be needed to
meet Plan requirements. In that event, the participant's full shares will be
purchased by the Plan. The price paid to the selling participant will be equal
to the average of the high and low sale prices of the Common Stock on the
trading day immediately prior to the processing of the participant's request by
PP&L, as reported by The Wall Street Journal (as composite transactions). The
participant will receive the proceeds of the sale less any applicable transfer
tax. There will be no brokerage commissions charged in connection with such
sales. At such times as PP&L Resources elects to meet Plan requirements with
newly issued shares of Common Stock, a participant's full shares will not be
purchased for the Plan. In those circumstances, sales of a participant's shares
will be handled only in the manner described in the preceding paragraph.
Dividends paid on any full or fractional shares remaining in the
participant's account will continue to be reinvested in accordance with the
terms of the Plan.
29. May a participant terminate his participation through payroll
deduction or dividend reinvestments and still remain in the Plan?
Yes. A participant who terminates payroll deductions or the
reinvestment of dividends paid on shares registered in his name may leave his
shares in the Plan. Subject to a participant's election to receive in cash a
specified percentage of dividends on shares in the participant's Plan account as
described in Question #18, dividends paid on shares left in the Plan will
continue to be automatically reinvested for his account. The participant may
also continue to make optional cash payments.
OTHER INFORMATION
30. What happens when a participant sells or transfers all of the shares
evidenced by certificates registered in his name?
If a participant disposes of all shares registered in his name in
certificate form, dividends on the shares held for the participant's account
under the Plan will continue to be reinvested unless otherwise instructed by the
participant.
31. What happens if PP&L Resources issues a stock dividend or declares a stock
spilt?
Any stock dividend or split shares distributed by PP&L Resources on
shares credited to the account of a participant under the Plan will be credited
to the participant's account. Stock dividends or split shares distributed on
shares held directly by participants will be mailed to such participants in the
same manner as to shareowners who are not participating in the Plan.
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32. How will a participant's shares held under the Plan be voted at
meetings of shareowners?
If shares registered in the name of a participant in the Plan are voted
by him on any matter submitted to a meeting of shareowners, PP&L will vote any
shares held in the participant's account under the Plan in accordance with the
participant's proxy or instructions for the shares registered in his name. If no
shares are registered in a participant's name, shares credited to the account of
a participant under the Plan will be voted in accordance with instructions of
the participant given on an instruction form which will be furnished to the
participant. If the participant desires to vote in person at the meeting, a
proxy for shares credited to his account under the Plan may be obtained upon
written request received by PP&L at least 15 days before the meeting.
If no instructions are received on a returned proxy card or instruction
form, properly signed, with respect to any item thereon, all of a participant's
shares--those registered in his name, if any, and shares credited to his account
under the Plan-- will be voted in the same manner as for non-participating
shareowners who return proxies and do not provide instructions -- i.e, in
accordance with the recommendations of the Board of Directors of PP&L Resources.
If the proxy card or instruction form is not returned or if it is returned
unsigned, none of the participant's shares will be voted unless the participant
votes in person.
33. What are the Federal income tax consequences of participation in the
Plan?
In the case of shares acquired for a participating shareholder in open
market transactions with reinvested dividends, for Federal income tax purposes
the participating shareholder will be treated as having received a cash dividend
in the amount of cash used to purchase shares on his behalf in the open market
(including any interest costs associated with advance purchases and any
brokerage commissions attributable to such shares). The Internal Revenue Service
has published a ruling of general application to the effect that a participant's
share of brokerage commissions applicable to shares purchased in the open market
(which will be paid by PP&L Resources) is taxable as dividend income to that
participant. That amount will be reported to the participant annually on Form
1099. A participating shareholder who acquires shares of Common Stock from the
Company with reinvested dividends under the Plan will be treated for Federal
income tax purposes as having received a dividend in the amount of the fair
market value of the shares of Common Stock received.
A participant's tax basis for shares purchased pursuant to the Plan
with reinvested dividends will be the amount included in income by the
participant with reference to such shares. A participant's tax basis for shares
purchased pursuant to the Plan with optional cash payments or employee payroll
deductions will be the price paid for such shares (including any interest costs
associated with advance purchases), increased by the amount of any brokerage
commissions attributable to the purchase of such shares. Because interest costs
associated with advance purchases are included in the participant's tax basis,
such interest costs are not deductible by the participant for Federal income tax
purposes. The shares will have a holding period beginning on the day after the
shares are allocated to the participant's account. The participant's statement
of account will show the tax basis for the current transaction and the date the
shares were allocated to the participant's account.
A participant will not recognize any taxable income when he receives
certificates for full shares credited to his account either upon his request
that such certificates be issued or upon withdrawal from the Plan or the
termination of the Plan by PP&L Resources. However, a participant must recognize
gain or loss when full
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shares credited to his account under the Plan are sold either at the request of
the participant or by the participant himself after certificates for such shares
have been registered in his name. A participant must also recognize gain or loss
when such participant receives a cash payment for any fractional share credited
to such participant's account upon such participant's withdrawal from the Plan
or upon the termination of the Plan by PP&L Resources. The amount of gain or
loss is the difference between the amount which the participant receives for the
shares (or fractional share) and the tax cost basis thereof.
In the case of those foreign shareowners whose dividends are subject to
United States federal income tax withholding or in the case of domestic
shareowners whose dividends are subject to the 31% backup withholding tax, the
amount applied to the purchase of shares will be equal to the amount of
dividends to be reinvested less the amount of any tax required to be withheld.
The regular Statement of Account confirming purchases will indicate the amount
of any tax withheld.
34. May the Plan be changed or discontinued?
PP&L Resources reserves the right to make modifications to the Plan. It
also reserves the right to suspend or terminate the Plan at any time. Any such
modification, suspension or termination will be announced to both participating
and non-participating shareowners. If the Plan should be terminated by PP&L
Resources, any shares of Common Stock purchased under the Plan which have not
been allocated to participants' accounts at the termination date will be sold in
the open market subject to any applicable requirements of law or marketing
considerations affecting the timing and manner of sale of such Common Stock.
35. What are the responsibilities of PP&L Resources and PP&L under the
Plan?
In administering the Plan, PP&L Resources and PP&L will not be liable
for any act done in good faith or for any omission to act in good faith,
including, without limitation, any claim of liability arising out of failure to
terminate a participant's account upon that participant's death or with respect
to the prices or times at which shares are purchased or sold for participants or
the sources from which such shares are purchased or sold; provided, however,
that the foregoing will not limit any liability of either PP&L Resources or PP&L
under the Federal securities laws.
36. Who interprets and regulates the Plan?
PP&L Resources and PP&L reserve the right to interpret and regulate the
Plan as may be necessary or desirable in connection with the operation of the
Plan.
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-----------------------------
Certain Tax Matters. In the opinion of Michael A. McGrail, Esq., Senior
Counsel of PP&L, Inc., the Common Stock is exempt from existing personal
property taxes in Pennsylvania.
Listing. The Common Stock will be listed on the New York and Philadelphia
Stock Exchanges.
Transfer Agents and Registrars. The Transfer Agents and Registrars for the
Common Stock are PP&L, Inc. and Norwest Bank Minnesota, N.A., South St. Paul,
MN.
EXPERTS
The consolidated financial statements of PP&L Resources incorporated in
this Prospectus by reference to PP&L Resources' 1998 Annual Report on Form 10-K
for the year ended December 31, 1998, have been so incorporated in reliance on
the report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
Statements made herein and in the documents incorporated by reference
in this Prospectus as to matters of law and legal conclusions have been reviewed
by Michael A. McGrail, Esq., Senior Counsel of PP&L, Inc., and have been made in
reliance on his authority as an expert. Mr. McGrail is a full-time employee of
PP&L, Inc.
-------------------------------
No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained in this Prospectus in
connection with the offer made by this Prospectus and, if given or made, such
information or representation must not be relied upon as having been authorized
by PP&L Resources. This Prospectus is not an offer to sell or a solicitation of
an offer to buy in any jurisdiction in which it is unlawful to make such an
offer or solicitation. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of PP&L Resources since the date hereof.
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