Exhibit C-4
PERFORMANCE UNITS AGREEMENT UNDER
THE 1990 STOCK PLAN FOR EMPLOYEES OF
GENERAL PUBLIC UTILITIES CORPORATION
AND SUBSIDIARIES
(1996 AGREEMENT)
AGREEMENT made as of , by and
between General Public Utilities Corporation (the "Corporation")
and (the "Recipient"):
WHEREAS, the Corporation maintains the 1990 Stock Plan for
Employees of General Public Utilities Corporation and
Subsidiaries (the "Plan") under which the Personnel, Compensation
and Nominating Committee of the Corporation's Board of Directors
(the "Committee") may, among other things, award units
("Performance Units") representing rights to acquire shares of
the Corporation's Common Stock, $2.50 par value ("Common Stock")
to such employees of the Corporation and its subsidiaries as the
Committee may determine, subject to such terms, conditions or
restrictions as it may deem appropriate;
WHEREAS, pursuant to the Plan, the Committee has granted to the
Recipient an award of Performance Units subject to the terms and
conditions set forth in this Agreement; and
WHEREAS, the Plan requires that an award of Performance Units be
evidenced by a written agreement between the Corporation and the
Recipient that contains such restrictions, terms and conditions
as the Committee may require;
NOW, THEREFORE, the parties hereto agree as follows:
1. AWARD OF PERFORMANCE UNITS; NATURE OF RIGHTS
(a) In accordance with the provisions of the Plan, the
Committee awarded to the Recipient on
(the "Award Date") Performance
Units. Each unit so awarded, and each additional
Performance Unit credited to the Recipient pursuant to
Section 2 (the Performance Units so awarded and the
additional Performance Units so credited are
hereinafter referred to collectively as the Recipient's
"Units"), shall entitle the Recipient, upon the vesting
of such units as provided in Section 3 hereof, to
receive one share of Common Stock, or a cash payment in
lieu of such share, subject to the terms, conditions,
and restrictions set forth herein.
(b) Prior to the issuance, as provided in Section 4
hereof, of shares of Common Stock with respect to the
Recipient's Units, or with respect to the Recipient's
"Deferred Vested Units" as defined in Section 4(g)(ii)
hereof, the Recipient shall not be entitled to any of
the rights of a stockholder of the Corporation by
reason of such Units or Deferred Vested Units.
(c) Notwithstanding anything in this Agreement to the
contrary, the Recipient shall have the status of a mere
unsecured creditor of the Corporation with respect to
his or her right to receive any payment hereunder; and
this Agreement shall constitute a mere promise by the
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Corporation to make payments in the future in
accordance with the terms hereof. It is the intention
of the parties hereto that the arrangements set forth
in this Agreement be treated as unfunded for tax
purposes and, if it should be determined that Title I
of ERISA is applicable to such arrangements, for
purposes of Title I of ERISA.
2. ADDITIONAL PERFORMANCE UNITS
(a) As of each date prior to the Vesting Date (as
defined in Section 3(a) below) on which a dividend is
paid on the Common Stock ("Dividend Payment Date"),
there shall be credited to the Recipient hereunder a
number of additional Performance Units determined by
multiplying (i) the aggregate number of Units standing
to the Recipient's credit immediately prior to such
Dividend Payment Date, by (ii) the quotient resulting
from dividing (A) the per share amount of the dividend
so paid by (B) the price per share used for the
reinvestment of dividends paid on such Dividend Payment
Date under the provisions of the Corporation's Dividend
Reinvestment and Stock Purchase Plan.
(b) Any additional Performance Units credited to the
Recipient pursuant to this Section 2 shall be subject
to the same terms, conditions and restrictions as are
applicable with respect to the Recipient's initially
awarded Performance Units.
3. ADJUSTMENT AND VESTING OF UNITS
(a) For purposes of this Agreement, the Recipient's
"Vesting Date" shall mean the earliest to occur of the
following dates:
(i) the fifth anniversary of the Award Date,
if the Recipient's employment with the Corporation
or any subsidiary has not terminated before such
anniversary for any reason other than as a result
of the Recipient's "Eligible Retirement" or "Total
Disability", as defined in the Plan;
(ii) the date as of which the Recipient's
employment with the Corporation or any subsidiary
terminates as a result of the Recipient's death;
or
(iii) an "Acceleration Date," as defined in
the Plan.
(b) As of the Recipient's Vesting Date, the aggregate
number of Units then standing to the Recipient's credit
shall be adjusted in accordance with the following
provisions:
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(i) The aggregate number of the Recipient's
Units shall be adjusted by multiplying such
aggregate number by the Performance Percentage
determined pursuant to the following table:
If the Corporation's TSR The Performance
TSR Percentile Ranking Percentage
is in the: Percentage shall be:
90th percentile - or above 200%
85th to 89th 175
80th to 84th 160
75th to 79th 145
70th to 74th 130
65th to 69th 120
60th to 64th 110
55th to 59th 100
50th to 54th 90
45th to 49th 75
40th to 44th 50
below 40th 0
For purposes of the foregoing, the Corporation's
TSR Percentile Ranking shall be determined by (A)
ascertaining, for each company (including the
Corporation) included in the Standard & Poor's
Electric Utility Companies Index (the "Index") on
the last day of the Performance Period (as defined
below), such company's average quarterly total
shareholder return ("TSR") for all calendar
quarters in the Performance Period, as reported in
the Index; (B) ascertaining the number of such
companies whose average quarterly TSR for the
Performance Period is lower than the
Corporation's; and (C) dividing such number by the
total number of companies included in the Index on
such last day. The "Performance Period" shall
mean the period from January 1, 1996 through
December 31, 2000.
(ii) Notwithstanding the foregoing, (A) if
the Recipient's Vesting Date occurs by reason of
the Recipient's death prior to the first day of
the calendar year which includes the fifth
anniversary of the Award Date, the Recipient's
Units shall not be adjusted in the manner
described in subparagraph (i) above; and (B) if
the Recipient's Vesting Date occurs by reason of
an Acceleration Date's occurring prior to such
first day, the adjustment with respect to the
Recipient's Units required under subparagraph (i)
above shall be made using 200% as the applicable
Performance Percentage.
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(iii) If the Recipient's employment with the
Corporation or any subsidiary terminates prior to
the fifth anniversary of the Award Date as a
result of the Recipient's death, Eligible
Retirement or Total Disability, the number of
Units standing to the Recipient's credit as of the
Recipient's Vesting Date (after taking into
account any adjustment required under subparagraph
(i) above) shall be adjusted (or further adjusted)
by multiplying such number of Units by the
Recipient's Service Percentage. The Recipient's
"Service Percentage" shall mean the percentage
determined by dividing by 60 the number of months
in the period beginning on the Award Date and
ending on the date of such termination of the
Recipient's employment; and for this purpose, any
fraction of a month included in such period shall
be treated as a full month. This subparagraph
(iii) shall not apply if the Recipient's Vesting
Date occurs by reason of the occurrence of an
Acceleration Date.
(c) As of the Recipient's Vesting Date, all Units then
standing to the Recipient's credit (after taking into
account any adjustments required under subparagraphs
(i), (ii) and (iii) of paragraph (b) above) shall
become vested. If the number of Units standing to the
Recipient's credit immediately prior to any adjustments
made pursuant to subparagraphs (i), (ii) and (iii) of
paragraph (b) above exceed the number of Units standing
to the Recipient's credit after giving effect to such
adjustments, all of the Recipient's rights with respect
to such excess number of Units shall be forfeited as of
the Vesting Date. If the Recipient's employment with
the Corporation or any subsidiary should terminate
before the Recipient's Vesting Date for any reason
other than as a result of the Recipient's Eligible
Retirement or Total Disability, all of the Recipient's
rights with respect to any Units credited to the
Recipient hereunder shall be forfeited as of the date
of such termination.
(d) For purposes of this Agreement, (i) the term
"subsidiary" shall have the same meaning as in
paragraph 4(a) of the Plan and (ii) the transfer of a
Recipient's employment from one subsidiary to another
shall not be treated as a termination of the
Recipient's employment.
4. PAYMENT FOR VESTED UNITS
(a) Upon the Vesting Date, the Recipient shall become
entitled to receive payment with respect to the Units
which have become vested on such date (such Units are
hereafter referred to as the Recipient's "Vested
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Units"). Payment shall be made as soon as practicable
after the Vesting Date, in the manner hereinafter set
forth in this Section 4.
(b) Except as otherwise provided in paragraph (c)
below, payment with respect to the Recipient's Vested
Units shall be made by the issuance to the Recipient of
shares of Common Stock. Except as otherwise provided in
paragraph (d) (ii) below, one share of Common Stock
shall be issued for each of the Recipient's Vested
Units. The Recipient shall own any shares of Common
Stock so issued free and clear of any restrictions and
shall be free to hold or dispose of such shares at
will, subject, however, to the restriction provided in
paragraph 9(b)(ii) of the Plan and any other
restriction that may be imposed by law.
(c) The Committee, in its sole discretion, may
determine that payment with respect to any or all of
the Recipient's Vested Units shall be made in cash
instead of in shares of Common Stock, and payment with
respect to any fractional part of a Vested Unit shall
be made in cash. Except as otherwise provided in
paragraph (d) (i) below, the amount of the cash payment
to be made with respect to any Vested Units shall be
equal to (and the amount of the cash payment to be made
with respect to any fractional part of a Vested Unit
shall be based upon) the per share closing price of one
share of Common Stock as reported on the New York Stock
Exchange Composite Tape for the Vesting Date, or if
there are no sales of Common Stock on such date, for
the next preceding day on which there were sales of
Common Stock.
(d) Upon the occurrence of an Acceleration Date, the
amount payable with respect to the Recipient's Vested
Units (including any Units that became vested prior to
such date but for which payment hereunder has not been
made as of such date but not including any Deferred
Vested Units as defined in Section 4(g)(ii) hereof
standing to the Recipient's credit on such date) shall
be determined as follows:
(i) To the extent that the payment for any
of the Recipient's Vested Units is to be made in
cash pursuant to paragraph (c) above, the amount
of cash to be paid for such Vested Units shall be
equal to the product of (A) the number of such
Vested Units, multiplied by (B) the highest
closing price per share of the Common Stock, as
reported on the New York Stock Exchange Composite
Tape, occurring during the 90-day period preceding
and the 90-day period following the Acceleration
Date (the "Multiplication Factor").
(ii) To the extent that payment for any of
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the Recipient's Vested Units is to be made in
shares of Common Stock pursuant to paragraph (b)
above, the number of shares of Common Stock to be
issued with respect to such Vested Units shall be
determined by dividing (A) the product of (y) the
number of such Vested Units multiplied by (z) the
Multiplication Factor, by (B) the per share
closing price of the Common Stock as reported on
the New York Stock Exchange Composite Tape for the
day preceding the payment date, or if there are no
sales of Common Stock on such date, for the next
preceding day on which there were sales of Common
Stock.
(e) If the Recipient has died prior to the date on
which any payment is to be made hereunder with respect
to the Recipient's Vested Units or Deferred Vested
Units, the payment otherwise required to be made to the
Recipient shall be made to the Recipient's beneficiary
or estate, as the case may be.
(f) Notwithstanding any provision herein to the
contrary, any payment required to be made with respect
to the Recipient's Vested Units (but not including any
Deferred Vested Units standing to the Recipient's
credit hereunder) as a result of or following the
occurrence of an Acceleration Date shall be made as
soon as practicable after such date but in the case of
any cash payment to an Officer Participant (as defined
in the Plan) no less than six months following the
Award Date.
(g) Notwithstanding any other provisions of this
Section 4 to the contrary, payment with respect to part
or all of the Recipient's Vested Units shall be
deferred, and shall be made at the time and in the
manner hereinafter set forth, if the Recipient so
elects in accordance with the following provisions:
(i) An election by the Recipient hereunder
shall be made in writing, on a form furnished to
the Recipient for such purpose by the Committee.
The form shall be filed with the Committee at
least one year prior to the Vesting Date.
(ii) In the Recipient's election form, the
Recipient shall specify the number of Vested Units
payment with respect to which the Recipient wishes
to defer (such number, and the number of
additional units credited to the Recipient
pursuant to subparagraph (vi) below are
hereinafter collectively referred to as the
Recipient's "Deferred Vested Units"); the date on
which payment with respect to the Recipient's
Deferred Vested Units shall be made, or commence
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(the "Payment Commencement Date") in accordance
with subparagraph (iii) below; and the method by
which payment with respect to the Recipient's
Deferred Vested Units shall be made (the "Payment
Method") in accordance with subparagraph (iv)
below.
(iii) The Recipient may select, as the Payment
Commencement Date, the first business day of any
of the following: (A) the third calendar year
following the calendar year in which the Vesting
Date occurs, or any later calendar year; (B) the
earlier of (x) any calendar year which the
Recipient is permitted to select under clause (A),
or (y) the calendar year following the later of
the Vesting Date or the date of the termination of
the Recipient's employment with the Corporation or
any subsidiary or the Recipient's Total
Disability; or (C) the calendar year following the
later of the Vesting Date or the date of the
termination of the Recipient's employment with the
Corporation or any subsidiary or the Recipient's
Total Disability, or any later calendar year.
(iv) The Recipient may select, as the Payment
Method, either (A) a single lump sum payment, or
(B) payment in annual installments, over a period
of at least five years, or such greater number of
years as the Recipient specifies in the
Recipient's election form. With each such annual
installment, payment shall be made with respect to
a number of the Recipient's Deferred Vested Units
equal to the quotient resulting from dividing (C)
the total number of Deferred Vested Units standing
to the Recipient's credit hereunder on the
applicable payment date, by (D) the number of
installment payments remaining to be made on such
date. Immediately after each annual installment
payment has been made, the number of Deferred
Vested Units standing to the Recipient's credit
hereunder shall be reduced by the number of
Deferred Vested Units with respect to which such
payment was made.
(v) Any election made hereunder by the
Recipient shall be irrevocable.
(vi) Until payment has been made with respect
to all of the Recipient's Deferred Vested Units
(including those credited to the Recipient under
this subparagraph), there shall be credited to the
Recipient hereunder, as of each Dividend Payment
Date, a number of additional Deferred Vested Units
determined by multiplying (A) the number of
Deferred Vested Units (including any additional
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Deferred Vested Units previously credited to the
Recipient under this subparagraph) standing to the
Recipient's credit hereunder on the day
immediately preceding such Dividend Payment Date,
by (B) the quotient referred to in Section
2(a)(ii) hereof.
(vii) Payment with respect to the Recipient's
Deferred Vested Units shall be made in cash, or in
shares of Common Stock, or in any combination of
cash or such shares, as the Committee shall
determine in its sole discretion. The amount of
the cash payment to be made with respect to any
Deferred Vested Units shall be equal to (and with
respect to any fractional part of a Deferred
Vested Unit, shall be based upon) the per share
closing price of one share of Common Stock as
reported on the New York Stock Exchange Composite
Tape for the last business day immediately
preceding the date on which such cash payment is
to be made.
(viii) A deferral election otherwise permitted
to be made hereunder shall be subject to the
following limitations:
(A) If the Recipient's Vesting Date should
occur within one year following the date on
which the Recipient's election form is filed
with the Committee, or if the Vesting Date
occurs more than one year from such date but
occurs as a result of the occurrence of an
Acceleration Date, the Recipient's deferral
election shall not be given effect, and
payment with respect to the Recipient's
Vested Units shall be made in accordance with
the other applicable provisions of this
Section 4.
(B) No deferral election shall be effective
hereunder if at any time during the 12-month
period ending on the Vesting Date, the
Recipient received a hardship withdrawal
under Section 7.1(e) of the General Public
Utilities Corporation and Subsidiary System
Companies Employee Savings Plan for
Nonbargaining Employees.
(C) No amount may be deferred with respect
to the Recipient's Vested Units pursuant to
the Recipient's deferral election hereunder
to the extent that any tax is required to be
withheld with respect to such amount pursuant
to applicable federal, state or local law.
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(ix) Notwithstanding any other provision in
this paragraph (g) to the contrary, to the extent
the Committee in its sole discretion so
determines, payment with respect to any part or
all of the Recipient's Deferred Vested Units may
be made to the Recipient or to the Recipient's
beneficiary or estate, on any date earlier than
the date on which such payment is to be made
pursuant to the Recipient's election hereunder, in
the following circumstances: (A) in the event of
the Recipient's death prior to the Payment
Commencement Date specified in the Recipient's
election hereunder; (B) in the event the Recipient
becomes entitled to receive payments under the
Long-Term Disability Plan or Employee Pension Plan
of any GPU System Company as a result of incurring
a Total Disability; and (C) in the event the
Recipient requests such early payment and the
Committee, in its sole discretion, determines that
such early payment is necessary to help the
Recipient meet some severe financial need arising
from circumstances which were beyond the
Recipient's control and which were not foreseen by
the Recipient at the time of the Recipient's
election hereunder.
5. WITHHOLDING TAXES
In connection with the issuance of any Common Stock or
the making of any cash payment in accordance with the
provisions of this Agreement, the Corporation shall
withhold the taxes then required by applicable federal,
state and local law to be so withheld. In lieu
thereof, the Corporation may require the Recipient (or,
in the event of the Recipient's death, the Recipient's
beneficiary or estate) to pay to the Corporation an
amount equal to the amount of taxes so required to be
withheld. Such payment to the Corporation shall be
made in cash, in shares of Common Stock with a market
value equal to such withholding obligation, or in any
combination thereof, as determined by the Committee.
6. ADMINISTRATION
(a) The Committee shall have full authority and sole
discretion (subject only to the express provisions of
the Plan) to decide all matters relating to the
administration and interpretation of the Plan and this
Agreement. All such Committee determinations shall be
final, conclusive, and binding upon the Corporation,
the Recipient, the Recipient's estate and any and all
other interested parties. Notwithstanding the
foregoing, any determination made by the Committee
after the occurrence of a "Change in Control" (as
defined in the Plan) shall be subject to judicial
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review under a "de novo" rather than a deferential
standard. The Recipient hereby acknowledges receipt of
the Corporation's Prospectus which includes the text of
the Plan.
(b) This Agreement shall be subject to the terms of
the Plan, and in the case of any inconsistency between
the Plan and this Agreement, the provisions of the Plan
shall govern.
7. NONASSIGNABILITY
The Recipient's rights to payments under this Agreement
shall not be subject in any manner to anticipation,
alienation, sale, transfer (other than transfer by will
or by the laws of descent and distribution),
assignment, pledge, encumbrance, attachment or
garnishment by the Recipient's creditors or the
creditors of the Recipient's spouse or any other
beneficiary.
8. RIGHT TO CONTINUED EMPLOYMENT
Nothing in the Plan or this Agreement shall confer on
the Recipient any right to continue as an employee of
the Corporation or any subsidiary or in any way affect
the Corporation or any subsidiary's right to terminate
the Recipient's employment at any time.
9. FORCE AND EFFECT
The various provisions of this Agreement are severable
in their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no
effect on the continuing force and effect of the
remaining provisions.
10. PREVAILING LAWS
This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania applicable to contracts
made, and to be enforced, within the Commonwealth of
Pennsylvania.
11. SUCCESSORS
This Agreement shall be binding upon and inure to the
benefit of the successors, assigns and heirs of the
respective parties.
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12. NOTICE
Any notice to the Corporation hereunder shall be in
writing addressed to:
Vice President, Human Resources
GPU Service Corporation
000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Any notice to the Recipient hereunder shall be in
writing addressed to:
or such other address as the Recipient shall specify to
the Corporation in writing.
13. ENTIRE AGREEMENT
This Agreement contains the entire understanding of the
parties and shall not be modified or amended except in
writing and duly signed by each of the parties hereto.
No waiver by either party of any default under this
Agreement shall be deemed a waiver of any later default
set forth above.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement, as of the date set forth above.
GENERAL PUBLIC UTILITIES CORPORATION
By:
Xxxxx X. Xxxx
Chairman, President and Chief
Executive Officer
(Recipient)
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