EXHIBIT 10-AA
GPU, INC.
1990 STOCK PLAN FOR EMPLOYEES OF
GPU, INC. AND SUBSIDIARIES
AS AMENDED AND RESTATED
TO REFLECT AMENDMENTS
THROUGH MARCH 5, 1998
1990 STOCK PLAN FOR EMPLOYEES OF
GPU, INC. AND SUBSIDIARIES
1. Purpose
GPU, Inc. (the "Corporation") desires to attract and retain employees
of outstanding talent. The 1990 Stock Plan for Employees of GPU, Inc. and
Subsidiaries (the "Plan") affords eligible employees the opportunity to acquire
proprietary interests in the Corporation and thereby encourages their highest
levels of performance.
2. Scope and Duration
(a) Awards under the Plan may be granted in the following forms:
(i) incentive stock options ("incentive stock options") as
provided in Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code") and non-qualified stock options ("non-qualified options") (the term
"options" includes incentive stock options and non-qualified options);
(ii) shares of Common Stock of the Corporation (the "Common
Stock") which are restricted as provided in Section 10 ("restricted shares"); or
(iii) rights to acquire shares of Common Stock which are
restricted as provided in Section 10 ("units" or "restricted units").
Options may be accompanied by stock appreciation rights ("rights").
(b) The maximum aggregate number of shares of Common Stock as to which
awards of options, restricted shares, units or rights may be made from time to
time under the Plan is 1,974,190 shares.(1) Shares issued pursuant to this Plan
may be in whole or in part, as the Board of Directors of the Corporation (the
"Board of Directors") shall from time to time determine, authorized but unissued
shares or issued shares reacquired by the
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(1) Initially, 1,000,000 shares were authorized to be issued under the Plan.
On May 29, 1991, the Corporation effected a two-for-one stock split by way
of a stock dividend, leaving 1,974,190 shares available for issuance under
the Plan on and after that date, after giving effect to shares previously
awarded.
Corporation. If for any reason any shares as to which an option has
been granted cease to be subject to purchase thereunder or any
restricted shares or restricted units are forfeited to the
Corporation, or to the extent that any awards under the Plan
denominated in shares or units are paid or settled in cash or are
surrendered upon the exercise of an option, then (unless the Plan
shall have been terminated) such shares or units, and any shares
surrendered to the Corporation upon such exercise, shall become
available for subsequent awards under the Plan unless such shares or
units, if so made available for subsequent awards under the Plan,
would not be exempt from Section 16(b) of the Securities Exchange Act
of 1934 (the "Exchange Act") pursuant to Rule 16b-3, as amended,
thereunder; provided, however, that shares surrendered to the
Corporation upon the exercise of an incentive stock option and shares
subject to an incentive stock option surrendered upon the exercise of
a right shall not be available for subsequent award of additional
stock options under the Plan.
(c) No incentive stock option shall be granted hereunder after March 4,
2008.
(d) The total number of shares of Common Stock with respect to which
options may be granted under the Plan to any employee during any calendar year
shall not exceed [400,000] shares.
3. Administration
(a) The Plan shall be administered by those members of the Personnel,
Compensation and Nominating Committee, or any successor thereto, of the Board of
Directors who are "nonemployee directors" within the meaning of Rule 16b-3, as
amended, under Section 16(b) of the Exchange Act or by such other committee
consisting of not less than two persons each of whom shall qualify as
"non-employee directors," as may be determined by the Board of Directors ("the
Committee").
(b) The Committee shall have plenary authority in its sole discretion,
subject to and not inconsistent with the express provisions of this Plan: (i) to
grant options, to determine the purchase price of the Common Stock covered by
each option, the term of each option, the employees to whom, and the time or
times at which, options shall be granted and the number of shares to be covered
by each option; (ii) to designate options as incentive stock options or
non-qualified options and to determine which options shall be accompanied by
rights; (iii) to grant rights and to determine the purchase price of the Common
Stock covered by each right or related option, the term of each right or related
option, the employees to whom, and the time or times at which,
rights or related options shall be granted and the number of shares to be
covered by each right or related option; (iv) to grant restricted shares and
restricted units and to determine the term of the Restricted Period (as defined
in Section 10) and other conditions applicable to such shares or units, the
employees to whom, and the time or times at which, restricted shares or
restricted units shall be granted and the number of shares or units to be
covered by each grant; (v) to interpret the Plan; (vi) to prescribe, amend and
rescind rules and regulations relating to the Plan; (vii) to determine the terms
and provisions of the option and rights agreements (which need not be identical)
and the restricted share and restricted unit agreements (which need not be
identical) entered into in connection with awards under the Plan, including any
provisions of such agreements that may permit a recipient of an award of
restricted units to elect, prior to the vesting of such units, to defer the
payment of cash and/or the delivery of shares of Common Stock otherwise to be
made upon the vesting of such restricted units, and/or to defer the payment of
any cash compensation awarded to the recipient with respect to such restricted
units, or with respect to any restricted stock awarded to the recipient, either
under this Plan or the GPU System Companies Deferred Compensation Plan (a
"Deferral"); and to make all other determinations deemed necessary or advisable
for the administration of the Plan. Without limiting the foregoing, the
Committee shall have plenary authority in its sole discretion, subject to and
not inconsistent with the express provisions of the Plan, (1) to select GPU
Officers (as defined below) for participation in the Plan, (2) to determine the
timing, price and amount of any grant or award under the Plan to any GPU
Officer, (3) either (A) to determine the form in which payment of any right
granted or awarded under the Plan will be made (i.e., cash, securities or any
combination thereof) or (B) to approve the election of the employee to receive
cash in whole or in part in settlement of any right granted or awarded under the
Plan. As used herein, the term "GPU Officer" shall mean an officer (other than
an assistant officer) of the Corporation and any person who may from time to
time be designated an executive officer of the Corporation by its Board of
Directors (the "Board"). The exercise by the Committee of the powers granted in
clauses (i), (ii), (iii), (iv), and (vii) hereof shall be subject to the
approval of the Board with respect to a recipient of an award hereunder who is
an officer (other than assistant officer) of the Corporation or the Chairman or
President of any subsidiary (as defined in Section 4(a) hereof) of the
Corporation. (The Committee and the Board are sometimes hereinafter referred to
as the "Grantors.")
(c) The Grantors may delegate to one or more of their members or to one
or more agents such administrative duties as they may deem advisable, and the
Grantors or any person to whom
they have delegated duties as aforesaid may employ one or more persons to render
advice with respect to any responsibility the Grantors or such person may have
under the Plan; provided, that the Grantors may not delegate any duties to a
member of the Board of Directors who would not qualify as a "non-employee
director" to administer the Plan as contemplated by Rule 16b-3, as amended, or
other applicable rules under the Exchange Act. The Grantors may employ
attorneys, consultants, accountants or other persons and the Grantors, the
Corporation and its officers and directors shall be entitled to rely upon the
advice, opinions or valuations of any such persons. All actions taken and all
interpretations and determinations made by the Grantors in good faith shall be
final and binding upon all employees who have received awards, the Corporation
and all other interested persons. Notwithstanding the foregoing, any action
taken or any interpretation or determination made by the Grantors after the
occurrence of a "Change in Control" (as defined in Section 7(c) hereof) which
adversely affects the rights of any employee with respect to any award made to
the employee hereunder shall be subject to judicial review under a "de novo"
rather than a deferential standard. No member or agent of the Grantors shall be
personally liable for any action, determination, or interpretation made in good
faith with respect to the Plan or awards made thereunder, and all members and
agents of the Grantors shall be fully protected by the Corporation in respect of
any such action, determination or interpretation.
4. Eligibility; Factors to be Considered in Making Awards
(a) Only employees of the Corporation or its subsidiaries may receive
awards under the Plan. The term "subsidiary" means any corporation one hundred
(100%) percent of the common stock of which is owned, directly or indirectly, by
the Corporation. A director of the Corporation or of a subsidiary who is not
also an employee will not be eligible to receive an award.
(b) In determining the employees to whom awards shall be granted and
the number of shares or units to be covered by each award, the Committee shall
take into account the nature of the employee's duties, his or her present and
potential contributions to the success of the Corporation and such other factors
as it shall deem relevant in connection with accomplishing the purposes of the
Plan.
(c) Awards may be granted singly, in combination or in tandem and may
be made in combination or in tandem with or in replacement of, or as
alternatives to, awards or grants under any other employee plan maintained by
the Corporation or its subsidiaries. An award made in the form of an option, a
unit or a right may provide, in the discretion of the Committee, for
(i) the crediting to the account of, or the current payment to, each employee
who has such an award of an amount equal to the cash dividends and stock
dividends paid by the Corporation upon one share of Common Stock for each
restricted unit, or share of Common Stock subject to an option or right,
included in such award, and for each restricted unit which is the subject of a
Deferral ("Dividend Equivalents"), or (ii) the deemed reinvestment of such
Dividend Equivalents and stock dividends in shares of Common Stock or the deemed
reinvestment of units in additional units, which deemed reinvestment in each
case shall be deemed to be made in accordance with the provisions of Section 10
and credited to the employee's account ("Additional Deemed Shares"). Such
Additional Deemed Shares shall be subject to the same restrictions (including
but not limited to provisions regarding forfeitures) applicable with respect to
the option, unit or right with respect to which such credit is made. Dividend
Equivalents not deemed reinvested as stock dividends shall not be subject to
forfeiture, and may bear amounts equivalent to interest or cash dividends as the
Committee may determine. An employee who has been granted incentive stock
options under the Plan may be granted an additional award or awards, subject to
such limitations as may be imposed by the Code with respect to incentive stock
options.
(d) The Committee, in its sole discretion, may grant to an employee who
has been granted an award under the Plan or any other employee plan maintained
by the Corporation, any of its subsidiaries, or any successor thereto, in
exchange for the surrender and cancellation of such award, a new award in the
same or a different form and containing such terms, including without limitation
a price which is different (either higher or lower) than any price provided in
the award so surrendered and cancelled, as the Committee may deem appropriate.
5. Option Price
(a) The purchase price of the Common Stock covered by each option shall
be determined by the Committee; provided, however, that the purchase price shall
not be less than 100% of the fair market value of the Common Stock on the date
the option is granted. Fair market value shall mean the closing price of the
Common Stock as reported on the New York Stock Exchange Composite Tape for the
date on which the option is granted, or if there are no sales on such date, on
the next preceding day on which there were sales. Such price shall be subject to
adjustment as provided in Section 13. The price so determined shall also be
applicable in connection with the exercise of any related right.
(b) The purchase price of the shares as to which an option is exercised
shall be paid in full at the time of exercise. Payment may be made in cash,
which may be paid by check or other
instrument acceptable to the Corporation, in shares of the Common Stock, valued
at the closing price of the Common Stock as reported on the New York Stock
Exchange Composite Tape for the date of exercise, or if there were no sales on
such date, on the next preceding day on which there were sales, or (if permitted
by the Committee and subject to such terms and conditions as it may determine)
by surrender of outstanding awards under the Plan. In addition, the purchase
price may be paid in whole or in part by delivering a properly executed exercise
notice in a form approved by the Committee together with irrevocable
instructions to a broker to promptly deliver to the Corporation the applicable
amount of the proceeds from the sale or loan securities. The purchase price may
also be paid in such other form or manner as the Committee may from time to time
approve.
(c) At the time of any exercise of an option granted to an employee
hereunder, the employee shall pay any amount determined by the Committee to be
necessary to satisfy all applicable federal, state or local tax requirements
relating to such exercise. The Committee may permit such amount to be paid in
other shares of Common Stock owned by the employee, or a portion of the shares
of Common Stock that otherwise would be issued to the employee upon such
exercise of the option, or a combination of cash and shares of such Common
Stock.
6. Term of Options
The term of each option granted under the Plan shall be such period of
time as the Committee shall determine, but not more than ten years from the date
of grant. Unless sooner forfeited pursuant to the terms of the applicable option
agreement or cancelled pursuant to Section 7(c) hereof, each option granted
under the Plan shall expire at the end of its term. Notwithstanding any other
provision in this Plan to the contrary, no option granted hereunder may be
exercised after the expiration of its term.
7. Exercise of Options
(a) Each option granted under the Plan shall become exercisable, in
whole or in part, at such time or times during its term as the agreement
evidencing the grant of such option shall specify; provided, however, that the
Committee may also, in its discretion, accelerate the exercisability of any
option in whole or in part at any time.
(b) Each option granted under the Plan that has become exercisable
pursuant to Section 7(a) hereof shall remain exercisable thereafter for such
period of time prior to the expiration of its term (including any period
subsequent to the
employee's termination of employment with the Corporation and all of its
subsidiaries for any reason) as the option agreement evidencing the grant of
such option shall provide.
(c) Subject to subsection (e) below but notwithstanding any other
provision of the Plan, upon the occurrence of a Change in Control of the
Corporation (the date upon which such event occurs shall be referred to for
purposes of this Plan as an "Acceleration Date"), all options granted under the
Plan and still outstanding on the Acceleration Date shall be cancelled, and the
Corporation's obligation in respect of each option so cancelled shall be
discharged by payment to the holder of such option of a single cash lump sum, in
an amount determined under subsection (d) below. Such amount shall be payable as
soon as practicable after the Acceleration Date. For purposes of the Plan, a
"Change in Control" shall mean 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 with or
into the Corporation or in which securities of the Corporation are issued,
unless such merger, consolidation or reorganization is a "Non-Control
Transaction." A "Non-Control Transaction" shall mean a merger, consolidation or
reorganization with or into the Corporation or in which securities of the
Corporation are issued 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 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 Persons, 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.
(d) The lump sum payment to be made in respect of any option pursuant
to subsection (c) above shall be an amount equal to (i) the excess, if any, of
the Determined Value of all shares that are still subject to the option as of
the Acceleration Date (including any shares as to which the option had not
otherwise become exercisable prior to such date) over the aggregate purchase
price of such shares, less (ii) the amount of all federal, state and local taxes
required by law to be withheld with respect to such payment. The "Determined
Value" of the shares still subject to an option as of the Acceleration Date
shall mean the amount determined by multiplying the number of such shares by the
"Multiplication Factor," as defined in Section 10(f)(i) hereof.
(e) Any incentive stock option granted under the Plan and still
outstanding immediately prior to the occurrence of a Change in Control shall,
upon the occurrence of the Change in Control, become immediately exercisable as
to all shares of Common Stock that are then still subject to the option. The
holder of any such incentive stock option shall be provided an opportunity to
exercise such option at such time prior to the time as of which the Change in
Control becomes effective, and in accordance with
such procedures, as the Committee shall determine. To the extent an option is so
exercised, the option shall not be cancelled as provided in subsection (c)
above.
(f) An option may be exercised, at any time or from time to time during
its term (subject, in the case of an incentive stock option, to such
restrictions as may be imposed by the Code), as to any or all full shares as to
which the option has become and remains exercisable; provided, however, that an
option may not be exercised at any one time as to less than 100 shares (or less
than the number of shares as to which the option is then exercisable, if that
number is less than 100 shares).
(g) Upon the exercise of an option or portion thereof in accordance
with the Plan, the option agreement and such rules and regulations as may be
established by the Committee, the holder thereof shall have the rights of a
shareholder with respect to the shares issued as a result of such exercise.
8. Award and Exercise of Rights
(a) A right may be awarded by the Committee in connection with any
option granted under the Plan, either at the time the option is granted or
thereafter at any time prior to the exercise, termination or expiration of the
option ("tandem right"), or separately ("freestanding right"). Each tandem right
shall be subject to the same terms and conditions as the related option and
shall be exercisable only to the extent the option is exercisable. A right shall
be exercisable (as to a tandem right, only to the extent the related option is
exercisable) on or after an Acceleration Date.
(b) A right shall entitle the employee upon exercise in accordance with
its terms (subject, in the case of a tandem right, to the surrender unexercised
of the related option or any portion or portions thereof which the employee from
time to time determines to surrender for this purpose) to receive, subject to
the provisions of the Plan and such rules and regulations as from time to time
may be established by the Committee, a payment having an aggregate value equal
to the product of (A) the excess of (i) the fair market value on the exercise
date of one share of Common Stock over (ii) the exercise price per share, in the
case of a tandem right, or the price per share specified in the terms of the
right, in the case of a freestanding right, multiplied by (B) the number of
shares with respect to which the right shall have been exercised. The payment
may be made in the form of all cash, all shares of Common Stock, or a
combination thereof, as elected by the employee.
(c) The exercise price per share specified in a right shall be as
determined by the Committee, provided that, in the case of a tandem right
accompanying an incentive stock option, the exercise price shall be not less
than fair market value of the Common Stock subject to such option on the date of
grant.
(d) If upon the exercise of a right the employee is to receive a
portion of the payment in shares of Common Stock, the number of shares shall be
determined by dividing such portion by the fair market value of a share on the
exercise date. The number of shares received may not exceed the number of shares
covered by any option or portion thereof surrendered. Cash will be paid in lieu
of any fractional share.
(e) No payment will be required from an employee upon exercise of a
right, except that any amount necessary to satisfy applicable federal, state or
local tax requirements shall be withheld or paid promptly by the employee upon
notification of the amount due and prior to or concurrently with delivery of
cash or a certificate representing shares. The Committee may permit such amount
to be paid in shares of Common Stock previously owned by the employee, or a
portion of the shares of Common Stock that otherwise would be distributed to
such employee upon exercise of the right, or a combination of cash and shares of
such Common Stock.
(f) The fair market value of a share shall mean the closing price of
the Common Stock as reported on the New York Stock Exchange Composite Tape for
the date of exercise, or if there are no sales on such date, on the next
preceding day on which there were sales; provided, however, that in the case of
rights that relate to an incentive stock option, the Committee may prescribe, by
rules of general application, such other measure of fair market value as the
Committee may in its discretion determine but not in excess of the maximum
amount that would be permissible under Section 422 of the Code without
disqualifying such option under Section 422.
(g) Upon exercise of a tandem fight, the number of shares subject to
exercise under the related option shall automatically be reduced by the number
of shares represented by the option or portion thereof surrendered.
(h) A right related to an incentive stock option may only be exercised
if the fair market value of a share of Common Stock on the exercise date exceeds
the option price.
9. Non-Transferability of Options, Rights and Units;
Holding Periods for GPU Officers
Except as may otherwise be provided in the agreement evidencing the
grant of any option, right or unit hereunder, any option, right, or unit granted
under the Plan shall not be transferable by the grantee thereof otherwise than
by will or the laws of descent and distribution; provided, that the designation
of a beneficiary by an employee shall not constitute a transfer; and options and
rights may be exercised during the lifetime of the employee only by the employee
or, unless such exercise would disqualify an option as an incentive stock
option, by the employee's guardian or legal representative.
10. Award and Delivery of Restricted
Shares or Restricted Units
(a) At the time an award of restricted shares or restricted units is
made, the Committee shall establish a period of time (the "Restricted Period")
applicable to such award. Each award of restricted shares or restricted units
may have a different Restricted Period. The Committee may, in its sole
discretion, at the time an award is made, prescribe conditions for the
incremental lapse of restrictions during the Restricted Period and for the lapse
or termination of restrictions upon the satisfaction of other conditions in
addition to or other than the expiration of the Restricted Period with respect
to all or any portion of the restricted shares or restricted units. The
Committee may also, in its sole discretion, shorten or terminate the Restricted
Period, or waive any conditions for the lapse or termination of restrictions
with respect to all or any portion of the restricted shares or restricted units.
Notwithstanding the foregoing, all restrictions shall lapse, and the Restricted
Period shall terminate, with respect to all restricted shares or restricted
units upon the occurrence of an Acceleration Date or at such earlier time as
provided for in Section 11 or Section 12.
(b) (1) Unless such shares are issued as uncertificated shares pursuant
to paragraph (3) below, a stock certificate representing the number of
restricted shares granted to an employee shall be registered in the employee's
name but shall be held in custody by the Corporation or an agent therefor for
the employee's account. The employee shall generally have the rights and
privileges of a shareholder as to such restricted shares, including the right to
vote such restricted shares, except that, subject to the provisions of Section
11 and Section 12, the following restrictions shall apply: (i) the employee
shall not be entitled to delivery of the certificate until the expiration or
termination of the Restricted Period and the satisfaction of any other
conditions prescribed by the Committee; (ii) none of the restricted shares may
be sold, transferred, assigned, pledged, or otherwise encumbered or disposed of
during the Restricted Period and until the satisfaction of any other conditions
prescribed by the Committee at the time of award; and (iii) all of the
restricted shares shall be forfeited and all rights of the employee to such
restricted shares shall terminate without further obligation on the part of the
Corporation unless the employee has remained an employee of the Corporation or
any of its subsidiaries until the expiration or termination of the Restricted
Period and the satisfaction of any other conditions prescribed by the Committee
at the time of award applicable to such restricted shares. At the discretion of
the Committee, (x) cash and stock dividends with respect to the restricted
shares may be either currently paid or withheld by the Corporation for the
employee's account, and interest may be paid on the amount of cash dividends
withheld at a rate and subject to such terms as determined by the Committee or
(y) the Committee may require that all cash dividends be applied to the purchase
of additional shares of Common Stock, and such purchased shares, together with
any stock dividends related to such restricted shares (such purchased shares and
stock dividends are hereafter referred to as "Additional Restricted Shares")
shall be treated as Additional Shares, subject to forfeiture on the same terms
and conditions as the original grant of the restricted shares to the employee.
(2) The purchase of any such Additional Restricted Shares
shall be made either (i) through the Corporation's Dividend Reinvestment and
Stock Purchase Plan, in which event the price of such shares so purchased
through the reinvestment of dividends shall be as determined in accordance with
the provisions of that plan and no stock certificate representing such
Additional Restricted Shares shall be registered in the employee's name or (ii)
in accordance with such alternative procedure as is determined by the Committee
in which event the price of such purchased shares shall be the closing price of
the Common Stock as reported on the New York Stock Exchange Composite Tape for
the date on which such purchase is made, or if there were no sales on such date,
the next preceding day on which there were sales. In the event that the
Committee shall not require reinvestment, cash or stock dividends so withheld by
the Committee shall not be subject to forfeiture. Upon the forfeiture of any
restricted shares (including any Additional Restricted Shares), such forfeited
shares shall be transferred to the Corporation without further action by the
employee. The employee shall have the same rights and privileges, and be
subject to the same restrictions, with respect to any shares received pursuant
to Section 13.
(3) Notwithstanding anything herein to the contrary, shares
representing restricted shares or Additional Restricted Shares may be issued as
uncertificated shares.
(c) Upon the expiration or termination of the Restricted Period and the
satisfaction of any other conditions prescribed by the Committee at the time of
award, or at such earlier time as provided for in Section 11 or Section 12, the
restrictions applicable to the restricted shares (including Additional
Restricted Shares) shall lapse and a stock certificate for the number of
restricted shares (including any Additional Restricted Shares) with respect to
which the restrictions have lapsed shall be delivered, free of all such
restrictions, except any that may be imposed by law, to the employee or the
employee's beneficiary or estate, as the case may be. The Corporation shall not
be required to deliver any fractional share of Common Stock but will pay, in
lieu thereof, the fair market value (determined as of the date the restrictions
lapse) of such fractional share to the employee or the employee's beneficiary or
estate, as the case may be.
No payment will be required from the employee upon the issuance or
delivery of any restricted shares, except that any amount necessary to satisfy
applicable federal, state or local tax requirements shall be withheld or paid
promptly upon notification of the amount due and prior to or concurrently with
the issuance or delivery of a certificate representing such shares. The
Committee may permit such amount to be paid in shares of Common Stock previously
owned by the employee, or a portion of the shares of Common Stock that otherwise
would be distributed to such employee upon the lapse of the restrictions
applicable to the restricted shares, or a combination of cash and shares of such
Common Stock.
(d) In the case of an award of restricted units, no shares of Common
Stock shall be issued at the time the award is made, and the Corporation shall
not be required to set aside a fund for the payment of any such award.
(e) Subject to subsection (g) below:
(i) Upon the expiration or termination of the Restricted
Period or the occurrence of an Acceleration Date and the satisfaction of any
other conditions prescribed by the Committee or at such earlier time as provided
for in Section 11 or Section 12, the Corporation shall deliver to the employee
or the employee's beneficiary or estate, as the case may be, one
share of Common Stock for each restricted unit with respect to which the
restrictions have lapsed ("vested unit").
(ii) In addition, if the Committee has not required the deemed
reinvestment of such Dividend Equivalents pursuant to Section 4, at such time
the Corporation shall deliver to the employee cash equal to any Dividend
Equivalents or stock dividends credited with respect to each such vested unit
and, to the extent determined by the Committee, the interest thereupon. However,
if the Committee has required such deemed reinvestment in connection with such
restricted unit, in addition to the stock represented by such vested unit, the
Corporation shall deliver the number of Additional Deemed Shares credited to the
employee with respect to such vested unit.
(iii) Notwithstanding the foregoing, the Committee may, in its
sole discretion, elect to pay cash or part cash and part Common Stock in lieu of
delivering only Common Stock for the vested units and related Additional Deemed
Shares. If a cash payment is made in lieu of delivering Common Stock, the amount
of such cash payment shall be equal to the closing price of the Common Stock as
reported on the New York Stock Exchange Composite Tape for the date on which the
Restricted Period lapsed with respect to such vested unit and related Additional
Deemed Shares, or if there are no sales on such date, on the next preceding day
on which there were sales.
(f) Upon the occurrence of an Acceleration Date, all outstanding vested
units (including restricted units whose restrictions have lapsed as a result of
the occurrence of such Acceleration Date) and credited Dividend Equivalents or
related Additional Deemed Shares shall be payable as soon as practicable after
such Acceleration Date in cash, in shares of Common Stock, or part in cash and
part in Common Stock, as the Committee, in its sole discretion, shall determine.
(i) Subject to subsection (g) below, to the extent that an
employee receives cash in payment for his or her vested units and Additional
Deemed Shares, such employees shall receive an amount equal to the product of
(x) the number of vested units and Additional Deemed Shares credited to such
employee's account for which such employee is receiving payment in cash
multiplied by (y) the highest closing price per share of Common Stock occurring
during the ninety (90) day period preceding and the ninety (90) day period
following the Acceleration Date (the "Multiplication Factor").
(ii) Subject to subsection (g) below, to the extent that an
employee receives Common Stock in payment for his or her vested units and
Additional Deemed Shares, such employee shall
receive the number of shares of Common Stock determined by dividing (x) the
product of (I) the number of vested units and Additional Deemed Shares credited
to such employee's account for which such employee is receiving payment in
Common Stock multiplied by (II) the Multiplication Factor, by (y) the fair
market value per share of the Common Stock for the day preceding the payment
date, or if there are no sales on such date, on the next preceding day on which
there were sales.
(g) No payment will be required from the employee upon the award of any
restricted units, the crediting or payment of any Dividend Equivalents or
Additional Deemed Shares, or the delivery of Common Stock or the payment of cash
in respect of vested units, except that any amount necessary to satisfy
applicable federal, state or local tax requirements shall be withheld or paid
promptly upon notification of the amount due. The Committee may permit such
amount to be paid in shares of Common Stock previously owned by the employee, or
a portion of the shares of Common Stock that otherwise would be distributed to
such employee in respect of vested units and Additional Deemed Shares, or a
combination of cash and shares of such Common Stock.
(h) In addition, the Committee shall have the right, in its absolute
discretion, upon or prior to the vesting of any restricted shares (including
Additional Restricted Shares) and restricted units (including Additional Deemed
Shares) to award cash compensation to the employee for the purpose of aiding the
employee in the payment of any and all federal, state and local income taxes
payable as a result of such vesting, if the performance of the Corporation
during the Restricted Period meets such criteria as the Committee shall have
prescribed.
(i) Notwithstanding any other provision in this Section 10 to the
contrary, any payment of cash and/or delivery of any shares of Common Stock
otherwise required to be made hereunder on any date with respect to any
restricted units awarded to an employee, or with respect to any cash
compensation awarded to an employee pursuant to subsection (h) above, may be
deferred, at the employee's election, either under this Plan or under the GPU
Companies Deferred Compensation Plan, to the extent such deferral is permitted
under, and upon such terms and conditions as may be set forth in, the written
agreement between the employee and the Corporation (whether as initially entered
into, or as subsequently amended) evidencing the award of such units, or cash
compensation, to the employee.
11. Termination of Employment
Unless otherwise determined by the Committee, if an employee to whom
restricted shares or restricted units have been granted
ceases to be an employee of the Corporation or of any of its subsidiaries prior
to the end of the Restricted Period applicable to the shares or units so granted
and prior to the satisfaction of any other conditions prescribed by the
Committee at the time of grant for any reason other than as set forth in Section
12, the employee shall immediately forfeit all restricted shares and restricted
units so granted, including all Additional Restricted Shares or Additional
Deemed Shares related thereto.
Any option, right, restricted share or restricted unit agreement, or
any rules and regulations relating to the Plan, may contain such provisions as
the Committee shall approve with reference to the determination of the date
employment terminates and the effect of leaves of absence. Any such rules and
regulations with reference to any option agreement shall be consistent with the
provisions of the Code and any applicable rules and regulations thereunder.
Nothing in the Plan or in any award granted pursuant to the Plan shall confer
upon any employee any right to continue in the employ of the Corporation or any
of its subsidiaries or interfere in any way with the right of the Corporation or
any such subsidiary to terminate such employment at any time.
12. Eligible Retirement, Death or Total Disability of Employee
(a) If the Committee so determines, the agreement evidencing the grant
of any restricted shares or restricted units to any employee may permit the
restricted shares or restricted units so granted, or any portion of such
restricted shares or restricted units, to become vested upon the employee's
death, Total Disability or Eligible Retirement.
(b) For purposes of this Plan, (i) "Total Disability" shall mean the
permanent inability of an employee, as a result of accident or sickness, to
perform any and every duty pertaining to such employee's occupation or
employment for which the employee is suited by reason of the employee's previous
training, education and experience, and (ii) "Eligible Retirement" shall mean
the date upon which an employee, having attained an age of not less than
fifty-five, terminates his or her employment with the Corporation and all of its
subsidiaries, provided that such employee is immediately eligible to receive a
pension (whether or not he or she otherwise elects to defer such receipt) under
Section 3.1 or 3.3 of the "Employee Pension Plan" maintained by any subsidiary
or subsidiaries of the Corporation for salaried employees, or any successor
thereto.
13. Adjustments Upon Changes in Capitalization, etc.
Notwithstanding any other provision of the Plan, the Committee may at
any time make or provide for such adjustments to the Plan, to the number and
class of shares available thereunder or to any outstanding options, restricted
shares or restricted units as it shall deem appropriate to prevent dilution or
enlargement of rights, including adjustments in the event of distributions to
holders of Common Stock other than a normal cash dividend, changes in the
outstanding Common Stock by reason of stock dividends, split-ups,
recapitalizations, mergers, consolidations, combinations or exchanges of shares,
separations, reorganizations, liquidations and the like. In the event of any
offer to holders of Common Stock generally relating to the acquisition of their
shares, the Committee may make such adjustment as it deems equitable in respect
of outstanding options, rights, and restricted units including in the
Committee's discretion revision of outstanding options, rights, and restricted
units so that they may be exercisable for or payable in the consideration
payable in the acquisition transaction. Any such determination by the Committee
shall be conclusive and binding on all parties. No adjustment shall be made in
the minimum number of shares with respect to which an option may be exercised at
any time. Any fractional shares resulting from such adjustments to options,
rights, limited rights, or restricted units shall be eliminated.
14. Effective Date
The Plan as initially adopted became effective as of June 1, 1990. The
Committee may, in its discretion, grant awards under the Plan, the grant,
exercise or payment of which shall be expressly subject to the conditions that
to the extent required at the time of grant, exercise or payment (i) the shares
of Common Stock covered by such awards shall be duly listed, upon official
notice of issuance, upon the New York Stock Exchange, and (ii) if the
Corporation deems it necessary or desirable a Registration Statement under the
Securities Act of 1933 with respect to such shares shall be effective.
15. Termination and Amendment
The Board of Directors of the Corporation may suspend, terminate,
modify or amend the Plan, provided that no amendment or modification to the
penultimate sentence of Section 3(c), to Section 7(c) or to this Section 15, nor
any suspension or termination of the Plan, effectuated (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, shall be effective if the amendment, modification, suspension or
termination adversely affects the rights of any employee under the Plan. If the
Plan is terminated, the terms of the Plan shall, notwithstanding such
termination, continue to apply to awards granted prior to such termination. In
addition, no amendment, modification, suspension or termination of the Plan
shall adversely affect the rights of any employee with respect to any award
(including without limitation any right with respect to the timing and method of
payment of any award) granted to the employee prior to the date of the adoption
of such amendment, modification, suspension or termination without such
employee's written consent.
16. Written Agreements
Each award of options, rights, restricted shares or restricted units
shall be evidenced by a written agreement, executed by the employee and the
Corporation, which shall contain such restrictions, terms and conditions as the
Committee may require.
17. Effect on Other Stock Plans
The adoption of the Plan shall have no effect on awards made or to be
made pursuant to other stock plans covering employees of the Corporation, its
subsidiaries, or any successors thereto.