**EXHIBIT 10.44**
FIRSTENERGY CORP.
EXECUTIVE BONUS PLAN
Effective November 3, 2004
 

 

**TABLE OF CONTENTS**     **PAGE**ARTICLE I  — PURPOSE 1ARTICLE II  — DEFINITIONS 12.1 Act. 12.2 Beneficiary. 12.3 Board of Directors. 12.4 CEO. 12.5 Committee. 12.6 Company. 12.7 Compensation. 12.8 Compensation Committee. 12.9 Date of Employment. 12.10 Effective Date. 12.11 Employee. 22.12 Employer. 22.13 ESLP. 22.14 Participant. 22.15 Plan. 22.16 Policy. 2ARTICLE III  — ELIGIBILITY AND PARTICIPATION 23.1 Eligibility of Employees Subject to Act at Date of Employment. 23.2 Eligibility of Employees Subject to Act upon Promotion. 23.3 Eligibility of CEO. 23.4 Participation. 23.5 Termination of Participation. 2ARTICLE IV  — BENEFIT 24.1 Policy. 24.2 Policies in ESLP. 34.3 Payment of Premiums. 34.4 Income to Participant. 34.5 Gross-Up Due to Taxable Income. 34.6 No Benefit to Company or Employer. 3ARTICLE V  — OWNERSHIP RIGHTS AND DUTIES UNDER THE POLICY 45.1 Policy Ownership. 45.2 Surrender, Withdrawal, Loan, Assignment, Change in Ownership. 4ARTICLE VI  — AMENDMENT OR TERMINATION OF THE PLAN 4ARTICLE VII  — CLAIMS PROCEDURES 47.1 Claims Procedure. 4
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     **PAGE**7.2 Legal Action. 5ARTICLE VIII  — GENERAL PROVISIONS 58.1 Committee; Duties. 58.2 Agents. 58.3 Indemnity of Committees. 58.4 Funding Policy. 68.5 Insurance Company Not a Party to This Plan. 68.6 Discharge of Company, Employers and Committee. 68.7 Non-alienation. 68.8 Entire Plan. 68.9 Validity. 68.10 Not a Contract of Employment. 68.11 Successors. 68.12 Governing Law. 6
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FIRSTENERGY CORP.
EXECUTIVE BONUS PLAN
     This Executive Bonus Plan is established by the Company for the benefit ofcertain highly compensated or management employees of the Employers effectiveNovember 3, 2004.
ARTICLE I — PURPOSE
     This Plan is established for the purpose of providing for the purchase ofpersonal life insurance for a Participant who is deemed to be a member of aselect group of highly compensated and/or management employees of an Employer.This Plan is part of an integrated executive compensation program that isintended to attract, retain, and motivate certain key executives who are in aposition to make significant contributions to the operation and profitabilityof the Employers for the benefit of stockholders and customers.
     ARTICLE II  — DEFINITIONS
     2.1 Act. “Act” means the Sarbanes-Oxley Act of 2002, as amended.—
     2.2 Beneficiary. “Beneficiary” means the person, persons, or entity(including, without limitation, any trustee) last designated by a Participantto receive the benefits specified hereunder in the event of the Participant’sdeath.
     2.3 Board of Directors. “Board of Directors” means the board of directors forthe Company.
     2.4 CEO. “CEO” means the Chief Executive Officer of FirstEnergy Corp.
     2.5 Committee. “Committee” means the FirstEnergy Corp. Employee Benefits,Claims and Appeals Committee.
     2.6 Company. “Company” means FirstEnergy Corp., an Ohio corporation.
     2.7 Compensation. “Compensation” means the Participant’s annual base salary.
     2.8 Compensation Committee. “Compensation Committee” means the compensationcommittee of the Board of Directors.
     2.9 Date of Employment. “Date of Employment” means the date on which anEmployee first performs services for an Employer as a common law employee.
     2.10 Effective Date. “Effective Date” means November 3, 2004.
     2.11 Employee. “Employee” means an individual who is performing services foran Employer as a common law employee.
     2.12 Employer. “Employer” means the Company and any affiliated or subsidiaryentity that is permitted by the Board of Directors to participate in this Plan.
     2.13 ESLP. “ESLP” means the Executive Supplemental Life Insurance Plan.
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     2.14 Participant. “Participant” means an Employee who is eligible and electsto participate in this Plan pursuant to Article III herein.
     2.15 Plan. “Plan” means the FirstEnergy Corp. Executive Bonus Plan.
     2.16 Policy. “Policy” means the life insurance policy on the life of theParticipant, selected by the Company and purchased and maintained pursuant tothe terms of this Plan.
ARTICLE III — ELIGIBILITY AND PARTICIPATION
     3.1 Eligibility of Employees Subject to Act at Date of Employment. Employeesof an Employer who are subject to the provisions of Section 402 of the Act attheir Date of Employment or on the date of enactment of the Act and who aredesignated as eligible by the CEO may participate in the Plan as of January 1following the Employee’s Date of Employment or such other date designated bythe CEO.
     3.2 Eligibility of Employees Subject to Act upon Promotion. Employees who, dueto a promotion, become subject to Section 402 of the Act, and who aredesignated as eligible by the CEO may participate in the Plan on the date ofsuch promotion or such other date designated by the CEO.
     3.3 Eligibility of CEO. Notwithstanding Sections 3.1 and 3.2, the CEO mayparticipate in this Plan only if he or she is designated as eligible by theCompensation Committee. The CEO may commence participation on the datedesignated by the Compensation Committee.
     3.4 Participation. An Employee, including the CEO, becomes a Participant inthe Plan when he or she elects to participate. An employee who applies for aPolicy or who agrees to the release of interests by the Company or any otherEmployer as provided in Section 4.2 is deemed to have elected to participate inthe Plan.
     3.5 Termination of Participation. The CEO may terminate the participation ofany Participant at any time for any reason. The Compensation Committee mayterminate the participation of the CEO at any time for any reason.Participation for each Participant shall terminate on the date the Participantceases to be an Employee.
ARTICLE IV  — BENEFIT
     4.1 Policy.
(a) Upon satisfaction of the eligibility requirementsof Article III, an Employee shall be provided applicationforms for a Policy. The Employee shall provide allinformation and submit to all examinations requested by thelife insurance company in the application form and process. (b) The Policy shall insure the Participant’s lifeand shall provide a death benefit as provided in this Section. (c) The Policy for a Participant whose Date ofEmployment is after the Effective Date shall have a deathbenefit equal to the Participant’s Compensation as of his orher Date of Employment. (d) The Policy for a Participant who was aparticipant in the ESLP shall have a death benefit equal tohis or her Compensation determined as of September 1, 2002. (e) The Policy for a Participant whose Date ofEmployment was prior to the Effective Date and who did notparticipate in the ESLP shall have a death benefit equal tothe
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  Participant’s Compensation as of the later of his or herDate of Employment or September 1, 2002. (f) The death benefit shall not be effective untilthe issuance date of the Policy. (g) In the event that a Policy is rated or aninsurance company declines to provide the coverage inaccordance with the application made by the Company, the CEOmay (i) terminate the participation of a Participant in thePlan and the Participant shall be treated as if he or she wasnever a Participant in the Plan, or (ii) take such action orcombination of actions as the CEO deems appropriate and agreedto by the Participant including, but not limited to,requesting the issuance of a policy with a smaller deathbenefit or providing for an annual premium amount that is lessthan the amount provided by Section 4.3. (h) The CEO, in his or her discretion and at anytime, may increase the death benefit under any Policy insuringthe life of any Participant except the CEO has no discretionor authority to increase the death benefit under any Policyinsuring his or her life. The Compensation Committee, in itsdiscretion and at any time, may increase the death benefitunder any Policy insuring the life of the CEO.
     4.2 Policies in ESLP.In the event a Participant is insured under a life insurance policy pursuant tothe ESLP, the Company may select such policy as the Policy to provide the deathbenefit under Section 4.1.
     4.3 Payment of Premiums. Provided the Participant is employed by an Employeron the initial effective date of a Policy or on the anniversary date of anissued Policy, the Participant’s Employer shall pay to the insurance company onbehalf of a Participant, an annual premium for such policy year that is theannual premium amount projected to keep the Policy in force until ageninety-five (95) if the Participant does not use tobacco products and to ageeighty (80) if the Participant uses tobacco products, assuming the insurancecarrier’s current crediting rate and mortality charges for that Policy. Suchprojected amount shall be based on current financial assumptions determined bythe Company including current interest rates or investment earnings or loses,mortality costs or other factors that affect the projected death benefit of thePolicy.
     4.4 Income to Participant.
(a) The annual premium paid by an Employer on behalfof a Participant shall be reported as income for federal,state, and local tax purposes to the Participant in the yearin which the premium is paid. (b) If the Company selects an ESLP Policy as providedin Section 4.2 and if the Company and all other Employers thathave an interest or benefit right in the Policy release all ora portion of their respective interests and benefit rights andsuch release results in taxable income to the Participant,such taxable income shall be reported as income for federal,state, and local tax purposes to the Participant as requiredby applicable law.
     4.5 Gross-Up Due to Taxable Income. The Participant’s Employer may, inits sole discretion, increase the Participant’s compensation in an amount asdetermined by the Employer to provide additional compensation to theParticipant to pay some or all of the income taxes on the taxable incomereferred to in Section 4.4 above.
     4.6 No Benefit to Company or Employer. Neither the Company nor any Employershall have any interest in any benefits under any Policy and shall have noright to collect any portion of the death benefit or cash value of the Policyat any time.
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ARTICLE V — OWNERSHIP RIGHTS AND DUTIES UNDER THE POLICY
     5.1 Policy Ownership. The Participant shall own the Policy and neither theCompany nor any Employer shall have any ownership of or interest in the Policy.
     5.2 Surrender, Withdrawal, Loan, Assignment, Change in Ownership. TheParticipant shall agree while employed by any Employer, the Participant shallnot:
(a) Surrender the Policy; (b) Withdraw or obtain a loan from the Policy; (c) Assign the Policy as collateral for security; (d) Change the ownership of the Policy byendorsement, assignment, or modification unless such new owneris a trust established by the Participant for estate planningpurposes; (e) Change the insured; or (f) Request settlement of the policy proceeds.
     The Participant shall execute an endorsement on the Policy or similarwritten agreement submitted to the issuer of the Policy that prohibits his orher exercise of any ownership rights that are restricted by this Section 5.2.If a Participant is not employed by any Employer, the endorsement or similaragreement may be removed from the Policy and the Company and all applicableEmployers shall execute all appropriate documents that they must execute topermit such removal.
ARTICLE VI — AMENDMENT OR TERMINATION OF THE PLAN
     The Board of Directors or the Compensation Committee may amend orterminate this Plan at any time. Upon termination of the Plan, the Participantshall no longer be subject to the restriction set forth in Section 5.2 of thePlan, and Employer shall not pay premiums on behalf of any Participant underSection 4.3 of the Plan.
ARTICLE VII  — CLAIMS PROCEDURES
     7.1 Claims Procedure.
(a) Any person claiming a benefit, requesting aninterpretation or ruling under this Plan, or requestinginformation under this Plan shall present the request inwriting to his or her Employer, which shall respond in writingwithin a reasonable period of time, but not later than ninety(90) days after receipt of the request. (b) **Denial of Claim**. If the claim or request isdenied, the written notice of denial shall state:
(i) The reason for denial, with specificreference to the provisions in the Plan on which thedenial is based; (ii) A description of any additionalmaterial or information required and an explanation ofwhy it is necessary; and (iii) An explanation of the Plan’s claimsreview procedure.
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(c) **Review of Claim**. Any person whose claim orrequest is denied may request a review by notice given to theCommittee within sixty (60) days following receipt ofnotification of the adverse determination. The claim orrequest shall be reviewed by the Committee which may, butshall not be required to, grant the claimant a hearing. Onreview, the claimant may have representation, examinepertinent documents, and submit issues and comments inwriting. (d) **Final Decision**. The decision on review shallnormally be made within sixty (60) days. If an extension oftime is required for a hearing or other special circumstances,the claimant shall be notified within such sixty (60) dayperiod of an extension which shall not be for more than anadditional sixty (60) days. The Committee’s decision shall bedelivered in   writing to claimant and shall state the reason and therelevant provisions in the Plan for the decision. Alldecisions on review shall be final and bind all partiesconcerned.
     7.2 Legal Action. A claimant must exhaust the review procedures ofSection 7.1 prior to the commencement of any actions at law, in equity,pursuant to arbitration or otherwise. No legal action may be commenced againstthis Plan, the Company, any Employer or the Committee more than 180 days afterthe Committee’s final decision has been rendered with respect to all or anyportion of the claim.
ARTICLE VIII — GENERAL PROVISIONS
     8.1 Committee; Duties. The Committee shall be the Named Fiduciary untilremoval by the CEO and the successor named by the CEO accepts such appointment.As Named Fiduciary, the Committee shall administer the Plan and shall have thepower and the duty to take all action and to make all decisions necessary orproper to carry out the Plan. The determination of the Committee as to anyquestion involving the general administration and interpretation of the Planshall be final, conclusive, and binding. A majority vote of the Committeemembers shall control any decision. Any discretionary actions to be taken underthe Plan by the Committee with respect to the classification of Employees,contributions or benefits shall be uniform in nature and applicable to allpersons similarly situated. Without limiting the generality of the foregoing,the Committee shall have the following discretionary authority, powers andduties:
(a) To require any person to furnish such informationas it may request for the purpose of the proper administrationof the Plan as a condition to receiving any benefit under thePlan; (b) To make and enforce such rules and regulationsand prescribe the use of such forms as it deems necessary forthe efficient administration of the Plan; (c) To interpret the Plan and to resolve ambiguities,inconsistencies and omissions; (d) To decide all questions concerning the Plan andany questions concerning the eligibility of any Employee toparticipate in the Plan; and (e) To determine the amount of benefits which will bepayable to any person in accordance with the provisions of thePlan.
     8.2 Agents. In the administration of this Plan, the Committee may, from timeto time, employ agents and delegate to them such administrative duties as itsees fit, and may from time to time consult with counsel, who may be counsel tothe Company or any Employer.
     8.3 Indemnity of Committees. The Company and each other Employer shallindemnify and hold harmless the members of the Committee and the CompensationCommittee against any and all claims, loss, damage, expense or liabilityarising from any action or failure to act with respect to this Plan, except inthe case of intentional misconduct.
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     8.4 Funding Policy. The funding policy for this Plan shall be to make premiumpayments as provided in Section 4.2.
     8.5 Insurance Company Not a Party to This Plan.Insurer shall be fully discharged from its obligations under the Policy bypayment of the Policy death benefit to the Beneficiary named in the Policy,subject to the terms and conditions of the Policy. In no event shall Insurer beconsidered a party to this Plan, or any modification or amendment hereof.
     8.6 Discharge of Company, Employers and Committee. The Company, each Employerand the Committee shall be fully discharged and all of its obligations underthis Plan shall be satisfied upon payment of the premiums required underSection 4.3 and the cancellation of its rights under the endorsement requiredby Section 5.2 after the date the Participant is not employed by any Employer.
     8.7 Non-alienation. No participant or other person shall have any right orpower, by draft, assignment or otherwise, to mortgage, pledge or otherwiseencumber in advance any payment under the Plan, and any attempt to do so shallbe absolutely void.
     8.8 Entire Plan. This written document is the final and exclusive statementof the terms of the Plan, and any claim of right or entitlement under the Planshall be determined in accordance with its provisions. In the event theParticipant executes an agreement in accordance with Section 4.1(g), however,any claim of right or entitlement under the Plan shall be determined inaccordance with the provisions of the agreement and the provisions of the Planto the extent they are not inconsistent with the agreement.
     8.9 Validity. If any provision of this Plan is held illegal, invalid orunenforceable, the remaining provisions shall nonetheless be enforceableaccording to their terms. Further, in the event that any provision is held tobe overbroad as written, such provision shall be deemed amended to narrow itsapplication to the extent necessary to make the provision enforceable accordingto law and enforced as amended.
     8.10 Not a Contract of Employment. The terms and conditions of the Plan shallnot be deemed to constitute a contract of employment between any Employer andan Employee, and an Employee (or his beneficiary) shall have no rights againstthe Company or any Employer except as may be otherwise provided specificallyherein. Moreover, nothing in the Plan shall be deemed to give an Employee theright to be retained in the service of any Employer or to interfere with theright of his or her Employer to discipline or discharge him or her at any time.
     8.11 Successors. The provisions of this Plan shall bind and inure to thebenefit of all Employers as their interest and liabilities may be determined bythe Company and their successors and assigns, and to each Participant and hisheirs, successors, personal representatives and assigns.
     8.12 Governing Law. The provisions of this Plan shall be construed andinterpreted according to the laws of the State of Ohio, except as preempted byfederal law.
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