Exhibit C-476
AMENDMENT TO SEVERANCE PROTECTION AGREEMENT
WHEREAS, GPU, Inc. and GPU Service, Inc. (collectively "GPU") and Xxx
X. Xxxxxx ("Executive") have entered into a Severance Protection Agreement,
dated November 5, 1998, by and among GPU and the Executive ("the Agreement");
and
WHEREAS, FirstEnergy Corp. ("FE") has entered into a definitive
agreement to merge with GPU; and
WHEREAS, FE is assuming the obligations stated in the Agreement on the
date on which the merger between FE and GPU becomes effective ("Effective
Time"), and
WHEREAS, FE and Executive wish to amend the terms of the Agreement to
include a provision establishing a retainer by which Executive will be available
to perform services for FE after the Effective Time;
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, effective as of the Effective Time, it is agreed as
follows:
1. The following new paragraphs shall be inserted as paragraphs 8A and 8B
in the Agreement:
8A. Termination. Executive shall cease to be an officer of GPU as
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of the Effective Time and his employment shall terminate on that date. FE and
Executive agree that the termination of his employment shall be considered a
termination giving rise to the payment of severance benefits under this
Agreement.
(a) Except as specifically provided in this Section 8A, FE
agrees that Executive will receive all of the benefits and compensation
identified in section 2 of this Agreement:
(i) To the extent the severance pay described in section
2(b)(2) of this Agreement is based on the Executive's Base Amount, FE shall pay
Executive severance in the amount of $80,000. In addition, FE agrees that
Executive will receive all severance pay based on amounts other than Executive's
Base Amount, identified in section 2(b) of this Agreement.
(ii) Executive shall not receive any amounts on account
of outplacement services provided for in section 2(b)(4), above.
(iii) All payments set forth in this section and in
sections 2(a) and 2(b)(1) and (2) of the Agreement shall be made by wire
transfer, in accordance with instructions given by Executive, at the time
specified in section 2(e) of the Agreement.
(b) FE consents to an amendment of the Senior Executive Life
Insurance Program agreement between GPU and Executive to prevent the release of
the collateral assignment on account of the merger between GPU and FE.
(c) Nothing in this Agreement is intended to diminish
Executive's rights under a certain Letter Agreement, entered into by GPU and the
Executive, dated August 8, 2000 ("August 2000 Letter"). FE is assuming all such
obligations of the August 2000 Letter as of the Effective Time.
8B. Consulting Agreement.
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(a) Executive agrees to be available for consultation with FE
with respect to management consulting services, which may include the following
and may include other services with Executive's consent, which shall not be
unreasonably withheld:
(i) organization, operation and reporting of foreign
subsidiaries;
(ii) sale of certain assets;
(iii) organization of the legal, claims, corporate
secretary, regulatory and governmental affairs functions;
(iv) corporate governance and control;
(v) administration of the legal department and
assistance regarding ongoing matters handled by outside law firms; and
(vi) facilitating access to key information and key
relationships, including outside counsel, and consultants; and
(vii) attending EEI Legal Committee Meetings as the member
nominated by a designated FE subsidiary.
(b) As consideration for his availability for consulting, FE
agrees to pay Executive, as a retainer, $1,350,000 (the "Retainer Amount"),
within three business days after the Effective Time, by wire transfer, in
accordance with instructions given by Executive.
(i) The parties agree that the Retainer Amount will
cover only the first 40 hours per calendar month of consulting services,
including travel time, performed by Executive; provided, however, time spent
attending and travelling to and from EEI Legal Committee meetings shall not be
counted toward the 40 hour limit. To the extent that FE and Executive mutually
agree that Executive will consult in excess of 40 hours in any month, FE agrees
to pay Executive $1500 per hour (including travel time, if any). Any amounts due
under this paragraph are to be paid within 15 days of the submission of an
invoice.
(ii) FE and Executive anticipate that the consulting
services to be rendered hereunder will be provided by means of telephone
conference calls. Executive will also be available to attend meetings or other
business discussions in person in New York City, at times and places mutually
agreed upon. If FE and Executive mutually agree that Executive shall travel
outside of New York City for any matters other than attendance at EEI Legal
Committee meetings, FE agrees to pay, in addition to the Retainer Amount, his
reasonable expenses and a per diem fee of $1,000 per day (or portion thereof)
for time within the United States and $2,000 per day (or portion thereof) for
time outside the United States. FE shall reimburse all Executive's travel
expenses in accordance with the FE travel policy for senior officers, and shall
pay Executive's registration fees for attendance at any EEI Legal Committee
meeting for which he is the member nominated by FE or a designated FE
subsidiary.
(iii) FE and Executive anticipate that Executive will
provide services under this Agreement from his home or other office. FE may, if
it so chooses, and on a limited basis, provide office space for Executive to use
in his sole discretion.
(c) This consulting arrangement set forth in this Section 8B
shall terminate on the earlier of: (i) May 31, 2003, or (ii) Executive's death
or disability.
(d) The Retainer Amount is paid in consideration of
Executive's agreeing to make himself available to perform services as described
herein. If this consulting arrangement terminates on account of Executive's
death or disability, or for any other reason other than Executive's willful
refusal to be available to perform such services, Executive shall be considered
to have earned, and shall be entitled to retain, the Retainer Amount.
(e) FE agrees (i) to indemnify and hold harmless Executive
from and against any losses, claims, demands, damages or liabilities of any kind
relating to or arising out of activities performed or services furnished
pursuant to the retainer, and (ii) to reimburse Executive for all reasonable
expenses (including reasonable fees and disbursements of counsel) incurred in
connection with investigation, preparing or defending any investigative,
administrative, judicial or regulatory action or proceeding in any jurisdiction
related to or arising out of such activities, services, whether or not in
connection with pending or threatened litigation to which Executive is a party,
in each case as such expenses are incurred or paid. FE will not, however, be
responsible for any such losses, claims, demands, damages, liabilities or
expenses to the extent that they are finally judicially determined to have
resulted from Executive's gross negligence or willful misconduct. FE also agrees
that Executive shall not have any liability (whether direct or indirect, in
contract, tort or otherwise) to FE or any of its securityholders or creditors
for or in connection with the retainer, except to the extent that any such
liability for losses, claims, demands, damages, liabilities or expenses incurred
by FE is finally judicially determined to have resulted from Executive's gross
negligence or willful misconduct. In no event shall Executive be responsible for
any special, indirect or consequential damages.
So Agreed: Date:
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Xxx X. Xxxxxx
For FirstEnergy Corp. Date:
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President
