Exhibit 10-R
RETIREMENT PLAN FOR OUTSIDE DIRECTORSOF GPU, INC.
AS AMENDED AND RESTATED AS OFNOVEMBER 7, 1996
RETIREMENT PLAN FOR OUTSIDE DIRECTORSOF GPU, INC.
1. Purpose
The Retirement Plan for Outside Directors of GPU, Inc. (the
"Plan") is designed to enhance the ability of GPU, Inc. (the
"Corporation") to attract and retain competent and experienced
Outside Directors by providing retirement benefits and death
benefits for Eligible Outside Directors who retire or die after
the Plan's Effective Date.
2. Definitions
Except as otherwise specified or as the context may otherwise
require, the following terms have the meanings indicated below
for all purposes of this Plan:
Board of Directors means the board of directors of the
Corporation.
Outside Director means a member of the Board of Directors who,
during the period involved, is not or was not an Officer or an
employee of the Corporation or a subsidiary thereof.
Board Service means service as an Outside Director of the
Corporation both before and after the Effective Date.
Change in Control means the occurrence during the term of the
Plan of:
(1) An acquisition (other than directly from the
Corporation) of any Common Stock or other voting securities of
the Corporation entitled to vote generally for the election of
directors (the "Voting Securities") by any "Person" (as the term
person is used for purposes of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")), immediately after which such Person has "Beneficial
Ownership" (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of twenty percent (20%) or more of the then
outstanding shares of Common Stock or the combined voting power
of the Corporation's then outstanding Voting Securities;
provided, however, in determining whether a Change in Control has
occurred, Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an
acquisition which would cause a Change in Control. A "Non-
Control Acquisition" shall mean an acquisition by (A) an employee
benefit plan (or a trust forming a part thereof) maintained by
(i) the Corporation or (ii) any corporation or other Person of
which a majority of its voting power or its voting equity
securities or equity interest is owned, directly or indirectly,
by the Corporation (for purposes of this definition, a
"Subsidiary"), (B) the Corporation or its Subsidiaries, or (C)
any Person in connection with a "Non-Control Transaction" (as
hereinafter defined);
(2) The individuals who, as of August 1, 1996, are
members of the Board of Directors (the "Incumbent Board"), cease
for any reason to constitute at least seventy percent (70%) of
the members of the Board of Directors; provided, however, that if
the election, or nomination for election by the Corporation's
shareholders, of any new director was approved by a vote of at
least two-thirds of the Incumbent Board, such new director shall,
for purposes of this Plan, be considered as a member of the
Incumbent Board; provided further, however, that no individual
shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an
actual or threatened "Election Contest" (as described in Rule
14a-11 promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of
a Person other than the Board of Directors (a "Proxy Contest")
including by reason of any agreement intended to avoid or settle
any Election Contest or Proxy Contest; or
(3) The consummation of:
(A) A merger, consolidation or reorganization
involving the Corporation, unless such merger, consolidation or
reorganization is a "Non-Control Transaction." A "Non-Control
Transaction" shall mean a merger, consolidation or reorganization
of the Corporation where:
(i) the shareholders of the Corporation,
immediately before such merger, consolidation or reorganization,
own directly or indirectly immediately following such merger,
consolidation or reorganization, at least sixty percent (60%) of
the combined voting power of the outstanding voting securities of
the corporation resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in substantially the
same proportion as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,
(ii) the individuals who were members of the
Incumbent Board immediately prior to the execution of the
agreement providing for such merger, consolidation or
reorganization constitute at least seventy percent (70%) of the
members of the board of directors of the Surviving Corporation,
or a corporation, directly or indirectly, beneficially owning a
majority of the Voting Securities of the Surviving Corporation,
and
(iii) no Person other than (w) the
Corporation, (x) any Subsidiary, (y) any employee benefit plan
(or any trust forming a part thereof) that, immediately prior to
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such merger, consolidation or reorganization, was maintained by
the Corporation or any Subsidiary, or (z) any Person who,
immediately prior to such merger, consolidation or reorganization
had Beneficial Ownership of twenty percent (20%) or more of the
then outstanding Voting Securities or Common Stock, has
Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Surviving Corporation's then
outstanding voting securities or its common stock.
(B) A complete liquidation or dissolution of the
Corporation; or
(C) The sale or other disposition of all or
substantially all of the assets of the Corporation to any Person
(other than a transfer to a Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not
be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the permitted
amount of the then outstanding Common Stock or Voting Securities
as a result of the acquisition of Common Stock or Voting
Securities by the Corporation which, by reducing the number of
shares of Common Stock or Voting Securities then outstanding,
increases the proportional number of shares Beneficially Owned by
the Subject Person, provided that if a Change in Control would
occur (but for the operation of this sentence) as a result of the
acquisition of shares of Common Stock or Voting Securities by the
Corporation, and after such share acquisition by the Corporation,
the Subject Person becomes the Beneficial Owner of any additional
shares of Common Stock or Voting Securities which increases the
percentage of the then outstanding shares of Common Stock or
Voting Securities Beneficially Owned by the Subject Person, then
a Change in Control shall occur.
Compensation means the sum of: (a) the monthly retainer paid
in cash to an Outside Director as compensation for services as a
Director of the Corporation, excluding any fees paid for
attendance at meetings of the Board of Directors or any committee
of the Board of Directors, and also excluding any additional
retainer paid for service as a Committee Chairman, and (b)
one-twelfth of the cash value of all shares awarded to, the
Outside Director pursuant to the Restricted Stock Plan for
Outside Directors as the annual award thereunder for the year
preceding his or her Retirement, and not subsequently forfeited.
The cash value of a share shall be its closing price as
reported for New York Stock Exchange-Composite Transactions on
the date of award.
Effective Date means the date of initial adoption of this
Plan by the Board of Directors.
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Retirement or Retires means the cessation of service as an
Outside Director for any reason other than (i) acceptance of
employment as an officer or employee of the Corporation or a
subsidiary thereof or (ii) death.
3. Eligibility
An Outside Director who has completed at least fifty-four (54)
months of Board Service and who Retires from the Board of
Directors or dies before Retirement on or after the Effective
Date shall be eligible for benefits as provided herein. After
the occurrence of a Change in Control, any person who was an
Outside Director immediately prior to such Change in Control
shall be eligible for benefits as provided herein upon Retirement
or death before Retirement, whether or not such Outside Director
has completed at least fifty-four (54) months of Board Service.
4. Pension Benefits of Eligible Retired Outside Directors
Before Death
The accumulated amount of pension benefits payable to an Outside
Director eligible to receive benefits hereunder shall be equal to
the product of (a) the number of months of such Outside
Director's Board Service under this Plan times (b) the monthly
compensation of such Outside Director at the date of such Outside
Director's Retirement under the Plan. Such pension benefits
shall be paid in monthly installments equal to the monthly
compensation of each Outside Director at the date of such Outside
Director's Retirement. Such pension benefits shall commence on
the first day of the month following the Director's 60th birthday
or the Director's Retirement under the Plan, whichever is later,
and shall continue during the Retired Outside Director's life
until the date when the total payments to the Retired Outside
Director shall be equal to the Outside Director's accumulated
pension benefits at the date of such Director's Retirement.
Notwithstanding any other provision of the Plan to the
contrary, each Outside Director shall be permitted to make a
special distribution election to have his or her pension benefits
distributed in the form of a single lump sum payment in the event
of the Outside Director's Retirement following a Change in
Control; provided, however, that such election shall be effective
only if it is made at least twelve (12) months prior to such
Change in Control. Any special election made hereunder may be
revoked, and a new special election may be made at any time;
provided, however, that any such revocation or new election shall
be effective only if it is made at least twelve (12) months prior
to a Change in Control. Any special election, or revocation of a
special election, that may be made hereunder shall be made in
writing, on a form furnished to the Outside Director for such
purpose by the Personnel, Compensation and Nominating Committee.
The lump sum payment to be made hereunder to an Outside Director
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shall be in an amount that is Actuarially Equivalent (as defined
in the GPU Service Corporation Employee Pension Plan or any
successor thereto and determined as of the date of the Outside
Director's Retirement) to the pension benefits that otherwise
would be payable hereunder if such pension benefits were to
commence upon the Outside Director's Retirement or 60th birthday,
whichever is later. The lump sum payment to be made hereunder
with respect to any Outside Director shall be made by no later
than 30 days following the date of the Outside Director's
Retirement.
5. Benefits Payable by Reason of Death of Eligible Outside
Director
In the event that an Outside Director who is eligible to receive
benefits hereunder should die prior to receiving payment of the
full amount of his or her accumulated pension benefits, the
remaining portion of such Outside Director's accumulated pension
benefits shall be paid as follows:
(a) If the Outside Director dies after Retirement, the
monthly payments previously made to the Outside Director shall
continue to be made to the Outside Director's surviving spouse
(or, if applicable, designated beneficiary) until the aggregate
of the payments to the Outside Director and such surviving spouse
or beneficiary shall be equal to the Outside Director's
accumulated pension benefits at the date of such Director's
Retirement.
(b) If the Outside Director dies prior to Retirement, there
shall be paid to the Outside Director's surviving spouse (or, if
applicable, designated beneficiary) monthly installments equal to
the monthly compensation of such Outside Director at the date of
such Outside Director's death until the aggregate of the payments
to such surviving spouse (or, if applicable, designated
beneficiary) shall be equal to the Outside Director's accumulated
amount of pension benefits at the date of the Outside Director's
death. Payment of such monthly installments shall begin on the
first day of the month next following the Outside Director's
death or, if later, the first day of the month in which the
Outside Director's 60th birthday would have occurred if the
outside Director had survived.
6. Designated Beneficiary of Eligible Outside Director
If an Eligible Outside Director shall die without leaving a
surviving spouse or if the Outside Director's surviving spouse
shall die prior to payment in full of the outside Director's
accumulated pension benefits, the payments which would otherwise
have been made to the Outside Director's surviving spouse shall
be made to the Outside Director's designated beneficiary (or
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beneficiaries). Such designations shall be made in writing on
forms provided by the Corporation to the Outside Director. Any
such designation by an Outside Director may be revoked by the
Outside Director at any time before or after Retirement. Any
such revocation shall be made in writing on a form provided by
the Corporation to the Outside Director.
7. Provision for Benefits
All benefits payable hereunder shall be provided from the
general assets of the Corporation. No Outside Director shall
acquire any interest in any specific assets of the Corporation by
reason of this Plan. An Outside Director shall have the status
of a mere unsecured creditor of the Corporation with respect to
his or her right to receive any payment under the Plan. The Plan
shall constitute a mere promise by the Corporation to make
payments in the future of the benefits provided for herein. It
is intended that the arrangements reflected in this Plan be
treated as unfunded for tax purposes.
8. Amendment and Termination
The Board of Directors reserves the right to terminate this Plan
or amend this Plan prospectively in any respect at any time, but
no such amendment may reduce (a) the benefits of any Outside
Director who has previously Retired hereunder, or (b) the
benefits accrued hereunder by any Outside Director prior to the
effective date of such termination or amendment. In addition,
the definition of Change in Control in Section 2, the last
sentence in Section 3, the last paragraph in Section 4, this
Section 8, and the last sentence of Section 9 may not be amended
or modified, and the Plan may not be terminated, (i) at the
request of a third party who has indicated an intention or taken
steps to effect a Change in Control and who effectuates a Change
in Control, (ii) within six (6) months prior to, or otherwise in
connection with, or in anticipation of, a Change in Control which
has been threatened or proposed and which actually occurs, or
(iii) following a Change in Control, if the amendment,
modification or termination adversely affects the rights of any
Outside Director under the Plan.
9. Administration
This Plan shall be administered by the Personnel, Compensation,
and Nominating Committee of the Board of Directors. Such
Committee's final decision, in making any determination or
construction under this Plan and in exercising any discretionary
power, shall in all instances be final and binding on all persons
having or claiming any rights under this Plan. Notwithstanding
the foregoing, any determination made by the Committee after the
occurrence of a Change in Control that denies in whole or in part
any claim made by any individual for benefits under the Plan
shall be subject to judicial review, under a de novo, rather
than a deferential, standard.
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10. Miscellaneous
Nothing herein contained shall be deemed to give any Outside
Director the right to be retained as a director of the
Corporation, nor shall it interfere with the Outside Director's
right to terminate such directorship at any time. An Outside
Director's rights to payments under this Plan 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, in the absence of a beneficiary designation),
assignment, pledge, encumbrance, attachment or garnishment by
creditors of the Outside Director or his or her spouse or other
beneficiary.
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