Limited Liability Company Agreement of JCP&L Transition Funding II LLC


    Exhibit
      4(a)

    
 

    LIMITED
      LIABILITY COMPANY AGREEMENT

     

    OF

     

    JCP&L
      TRANSITION FUNDING II LLC

     

    This
      Limited Liability Company Agreement (together with the schedules attached
      hereto, this “Agreement”) of JCP&L Transition Funding II LLC, a Delaware
      limited liability company (the “Company”), dated as of March 29, 2004, is
      entered into by Jersey Central Power & Light Company, a New Jersey
      corporation, as the sole member (the “Member”). Capitalized terms used herein
      and not otherwise defined have the meanings set forth on Schedule
      A
      hereto.

     

    The
      Member, by execution of this Agreement, (i) hereby forms the Company as a
      limited liability company pursuant to and in accordance with the Delaware
      Limited Liability Company Act (6 Del. C. §18-10l, et seq.), as amended from time
      to time (the “Act”), and (ii) hereby agrees as follows:

     

    1.    Name.

     

    The
      name
      of the limited liability company formed hereby is JCP&L Transition Funding
      II LLC.

     

    2.    Principal
      Business Office.

     

    The
      principal business office of the Company shall be located at such location
      as
      may hereafter be determined by the Member.

     

    3.    Registered
      Office.

     

    The
      address of the registered office of the Company in the State of Delaware is
      c/o
The
      Corporation Trust Company, Corporation Trust Center, 1209 Orange Street,
      Wilmington, Delaware 19801.

     

    4.    Registered
      Agent.

     

    The
      name
      and address of the registered agent of the Company for service of process on
      the
      Company in the State of Delaware are The Corporation Trust Company, Corporation
      Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.

     

    5.    Member.

     

    The
      name
      and the mailing address of the Member are set forth on Schedule
      B
      attached
      hereto.

     

    6.    Certificates.

     

    Bernard
      J. Kelley, as an “authorized person” within the meaning of the Act, shall
      execute, deliver and file the Certificate of Formation with the Secretary of
      State of the State of Delaware. Upon the filing of the Certificate of Formation
      with the Secretary of State of the State

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    of
      Delaware, his powers as an “authorized person” shall cease, and the Member and
      the Managers thereupon shall become designated “authorized persons” and shall
      continue as designated “authorized persons” within the meaning of the Act. The
      Member or any Manager shall execute, deliver and file any other certificates
      (and any amendments and/or restatements thereof) necessary for the Company
      to
      qualify to do business in New Jersey and in any other jurisdiction in which
      the
      Company may wish to conduct business.

     

    7.    Purposes.

     

    The
      Company is formed for the object and purpose of, and the nature of the business
      to be conducted and promoted by the Company is, engaging in any lawful act
      or
      activity for which limited liability companies may be formed under the
      Act.

     

    8.    Duration.

     

    The
      existence of the Company as a separate legal entity shall continue until
      cancellation of the Certificate of Formation of the Company as provided in
      the
      Act.

     

    9.    Powers.

     

    In
      furtherance of its purposes, but subject to all of the provisions of this
      Agreement, the Company, and the Member or any Manager, on behalf of the Company,
      acting individually or collectively, shall have the power and is hereby
      authorized:

     

    a.   to
      prepare and file with the Securities and Exchange Commission (the “Commission”)
      and to execute, in the case of the 1933 Act Registration Statement and 1934
      Act
      Registration Statement (as herein defined), on behalf of the Company, (i) a
      Registration Statement (the “1933 Act Registration Statement”), including all
      pre-effective and post-effective amendments thereto, relating to the
      registration under the Securities Act of 1933, as amended (the “1933 Act”), of
      the transition bonds of the Company, (ii) any prospectus or prospectus
      supplement thereto relating to the transition bonds of the Company required
      to
      be filed pursuant to the 1933 Act, and (iii) a Registration Statement on an
      appropriate form (the “1934 Act Registration Statement”), including all
      pre-effective and post-effective amendments thereto, relating to the
      registration of the transition bonds of the Company under the Securities
      Exchange Act of 1934, as amended;

     

    b.   to
      file
      and execute on behalf of the Company, such applications, reports, surety bonds,
      irrevocable consents, appointments of attorney for service of process and other
      papers and documents that shall be necessary or desirable to register the
      transition bonds of the Company under the securities or “blue sky” laws of such
      jurisdictions as the Managers, on behalf of the Company, may deem necessary
      or
      desirable;

     

    c.   to
      execute and deliver letters or documents to, or instruments for filing with,
      a
      depository relating to the transition bonds of the Company; 

     

    d.   to
      execute, deliver and perform on behalf of the Company an underwriting or
      purchase agreement with one or more underwriters or purchasers relating to
      the
      offering of the transition bonds of the Company; 

     

    
      
        
        

      

      
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    e.   to
      enter
      into, perform and carry out contracts of any kind, including, without
      limitation, contracts with any Person affiliated with the Member necessary
      to,
      in connection with, convenient to, or incidental to the accomplishment of the
      purposes of the Company;

     

    f.    to
      employ
      or otherwise engage employees, managers, contractors, advisors, attorneys and
      consultants and pay reasonable compensation for such services; 

     

    g.    to
      open
      and maintain one or more bank accounts; rent safety deposit boxes or vaults;
      sign checks, written directions or other instruments to withdraw all or part
      of
      funds belonging to the Company and on deposit in any savings account or checking
      account; negotiate and purchase certificates of deposit; obtain access to the
      Company safety deposit box or boxes, and generally sign such forms on behalf
      of
      the Company as may be required to conduct the banking activities of the company;
      and

     

    h.   to
      do
      such other things and engage in such other activities related to the foregoing
      as may be necessary, convenient or incidental to the conduct of the business
      of
      the Company, and have and exercise all of the powers and rights conferred upon
      limited liability companies formed pursuant to the Act.

     

    The
      Company, and any Member, Manager or officer of the Company, acting alone, on
      behalf of the Company, may enter into and perform any documents contemplated
      in
      subsections a. through d. of this Section 9 and any other documents contemplated
      thereby or related thereto and any amendments thereto without any further act,
      vote or approval of any Person, including any Member, notwithstanding any other
      provision of this Agreement. Each Member, Manager and officer of the Company
      is
      hereby authorized to enter into the documents described in the preceding
      sentence on behalf of the Company, but such authorization shall not be deemed
      a
      restriction on the power of such Member, Manager or officer of the Company
      to
      enter into other documents on behalf of the Company.

     

    10.    Management.

     

    a.   Board
      of Managers.
      The
      business and affairs of the Company shall be managed by or under the direction
      of a Board comprised of one or more Managers to be elected, designated or
      appointed by the Member. The Member may determine at any time in its sole and
      absolute discretion the number of managers to constitute the Board. The
      authorized number of Managers may be increased or decreased by the Member at
      any
      time in its sole and absolute discretion. The initial number of Managers shall
      be three. The names and mailing addresses of the persons designated as initial
      Managers are set forth in Schedule
      C
      attached
      hereto. Each Manager elected, designated or appointed by the Member shall hold
      office until his or her successor is elected and qualified or until such
      Manager’s earlier death, resignation or removal. As a condition and
      qualification to serving as a Manager, each Manager shall execute and deliver
      to
      the Company the Management Agreement set forth in Schedule
      D
      attached
      hereto.

     

    b.   Powers.
      The
      Board shall have the power to do any and all acts necessary, convenient or
      incidental to or for the furtherance of the purpose described herein, including
      all powers, statutory or otherwise.

     

    
      
        
        

      

      
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    c.   Meeting
      of the Board of Managers.
      The
      Board of Managers of the Company may hold meetings, both regular and special,
      within or outside the State of Delaware. Regular meetings of the Board may
      be
      held without notice at such time and at such place as shall from time to time
      be
      determined by the Board. Special meetings of the Board may be called by the
      President on not less than 24 hours’ notice to each Manager by telephone,
      facsimile, mail, telegram or any other means of communication, and special
      meetings shall be called by the President or Secretary in like manner and with
      like notice upon the written request of any one or more of the
      Managers.

     

    d.   Quorum;
      Acts of the Board.
      At all
      meetings of the Board, a majority of the Managers shall constitute a quorum
      for
      the transaction of business and, except as otherwise provided in any other
      provision of this Agreement, the act of a majority of the Managers present
      at
      any meeting at which there is a quorum shall be the act of the Board. If a
      quorum shall not be present at any meeting of the Board, the Managers present
      at
      such meeting may adjourn the meeting from time to time, without notice other
      than announcement at the meeting, until a quorum shall be present. Any action
      required or permitted to be taken at any meeting of the Board or of any
      committee thereof may be taken without a meeting if all members of the Board
      or
      committee, as the case may be, consent thereto in writing, and the writing
      or
      writings are filed with the minutes of proceedings of the Board or
      committee.

     

    e.   Electronic
      Communications.
      Members
      of the Board, or any committee designated by the Board, may participate in
      meetings of the Board, or any committee, by means of telephone conference or
      similar communications equipment that allows all persons participating in the
      meeting to hear each other, and such participation in a meeting shall constitute
      presence in person at the meeting. If all the participants are participating
      by
      telephone conference or similar communications equipment, the meeting shall
      be
      deemed to be held at the principal place of business of the
      Company.

     

    f.    Committees
      of Managers.

     

    (i)    The
      Board
      may designate one or more committees, each committee to consist of one or more
      of the Managers of the Company. The Board may designate one or more Managers
      as
      alternate members of any committee, who may replace any absent or disqualified
      member at any meeting of the committee.

     

    (ii)    In
      the
      absence or disqualification of a member of a committee, the member or members
      thereof present at any meeting and not disqualified from voting, whether or
      not
      such members constitute a quorum, may unanimously appoint another member of
      the
      Board to act at the meeting in the place of any such absent or disqualified
      member.

     

    (iii)   Any
      such
      committee, to the extent provided in the resolutions of the Board, shall have
      and may exercise all the powers and authority of the Board in the management
      of
      the business and affairs of the Company. Such committee or committees shall
      have
      such name or names as may be determined from time to time by resolution adopted
      by the Board. Each committee shall keep regular minutes of its meetings and
      report the same to the Board when required.

     

    
      
        
        

      

      
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    g.   Compensation
      of Managers; Expenses.
      The
      Managers shall not be compensated for their services hereunder. No Manager
      is
      precluded from serving the Company in any other capacity and receiving
      compensation therefor.

     

    h.   Removal
      of Managers.
      Unless
      otherwise restricted by law, any Manager or the entire Board of Managers may
      be
      removed, with or without cause, by the Member, and, any vacancy caused by any
      such removal may be filled by action of the Member.

     

    i.    Managers
      as Agents.
      To the
      extent of their powers set forth in this Agreement, the Managers are agents
      of
      the Company for the purpose of the Company’s business, and the actions of the
      Managers taken in accordance with such powers set forth in this Agreement shall
      bind the Company. However, except as provided in this Agreement or authorized
      by
      the Board, no Manager shall have the authority to bind the Company in his or
      her
      individual capacity. Any and all actions of the Board must be taken at a duly
      authorized meeting of the Board or upon unanimous written consent of the
      Board.

     

    11.   Duties
      of Managers.

     

    Except
      as
      provided in this Agreement, in exercising their rights and performing their
      duties under this Agreement, the Managers shall have a fiduciary duty of loyalty
      and care similar to that of directors of a business corporation organized under
      the General Corporation Law of the State of Delaware.

     

    12.   Officers.

     

    a.    Officers.
      The
      initial Officers of the Company are listed on Schedule
      E
      attached
      hereto. Except for the initial Officers, the Officers of the Company shall
      be
      chosen by the Board and shall consist of at least a President, a Secretary
      and a
      Treasurer. The Board of Managers may also choose one or more Vice Presidents,
      one or more Assistant Secretaries and one or more Assistant Treasurers. Any
      number of offices may be held by the same person. Each Officer shall hold office
      until his or her successor is elected and qualified or until such officer’s
      earlier death, resignation or removal. Any Officer may resign at any time upon
      written notice to the Company. In addition, the Board may appoint such other
      Officers and agents as it shall deem necessary or advisable who shall hold
      their
      offices for such terms and shall exercise such powers and perform such duties
      as
      shall be determined from time to time by the Board. The salaries of all Officers
      and agents of the Company shall be fixed by or in the manner prescribed by
      the
      Board. Any initial Officer or any Officer elected or appointed by the Board
      may
      be removed at any time, with or without cause, by the affirmative vote of a
      majority of the Board. Any vacancy occurring in any office of the Company shall
      be filled by the Board.

     

    b.   President.
      The
      President shall be the chief executive officer of the Company, shall preside
      at
      all meetings of the Board, shall be responsible for the general and active
      management of the business of the Company and shall see that all orders and
      resolutions of the Board are carried into effect. The President shall execute
      all bonds, mortgages and other contracts, except: (i) where required or
      permitted by law or this Agreement to be otherwise signed and executed; (ii)
      where signing and execution thereof shall be expressly delegated by
      the

     

    
      
        
        

      

      
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    Board
      to
      some other Officer or agent of the Company; and (iii) as otherwise permitted
      in
      Section 12c.

     

    c.   Vice
      President.
      In the
      absence of the President or in the event of the President’s inability to act,
      the Vice President, if any (or in the event there be more than one Vice
      President, the Vice Presidents in the order designated by the Managers, or
      in
      the absence of any designation, then in the order set forth on Schedule
      E
      hereto),
      shall perform the duties of the President, and when so acting, shall have all
      the powers of and be subject to all the restrictions upon the President. The
      Vice President, if any, shall perform such other duties and have such other
      powers as the Board may from time to time prescribe.

     

    d.   Secretary
      and Assistant Secretary.
      The
      Secretary shall be responsible for filing legal documents and maintaining
      records for the Company. The Secretary shall attend all meetings of the Board
      and record all the proceedings of the meetings of the Company and of the Board
      in a book to be kept for that purpose and shall perform like duties for special
      and standing committees when required. The Secretary shall give, or cause to
      be
      given, notice of all special meetings of the Board, and shall perform such
      other
      duties as may be prescribed by the Board or the President, under whose
      supervision the Secretary shall serve. The Assistant Secretary, or if there
      be
      more than one, the Assistant Secretaries in the order determined by the Board
      (or if there be no such determination, then in order of their election), shall,
      in the absence of the Secretary or in the event of the Secretary’s inability to
      act, perform the duties and exercise the powers of the Secretary and shall
      perform such other duties and have such other powers as the Board may from
      time
      to time prescribe.

     

    e.   Treasurer
      and Assistant Treasurer.
      The
      Treasurer shall have the custody of the Company funds and securities and shall
      keep full and accurate accounts of receipts and disbursements in books belonging
      to the Company and shall deposit all moneys and other valuable effects in the
      name and to the credit of the Company in such depositories as may be designated
      by the Board. The Treasurer shall disburse the funds of the Company as may
      be
      ordered by the Board, taking proper vouchers for such disbursements, and shall
      render to the President and to the Board, at its regular meetings or when the
      Board so requires, an account of all of the Treasurer’s transactions and of the
      financial condition of the Company. The Assistant Treasurer, or if there shall
      be more than one, the Assistant Treasurers in the order determined by the Board
      (or if there be no such determination, then in the order of their election),
      shall, in the absence of the Treasurer or in the event of the Treasurer’s
      inability to act, perform the duties and exercise the powers of the Treasurer
      and shall perform such other duties and have such other powers as the Board
      may
      from time to time prescribe.

     

    f.    Controller
      and Assistant Controller.
      The
      Controller shall be the chief accounting officer of the Company. The Controller
      shall keep full and accurate accounts of the assets, liabilities, commitments,
      receipts, disbursements and other financial transactions of the Company; shall
      cause regular audits of the books and records of account of the Company and
      supervise the preparation of the Company’s financial statements; and, in
      general, shall discharge such other duties as may from time to time be assigned
      by the Board or the President. The Assistant Controller, or if there shall
      be
      more than one, the Assistant Controllers in the order determined by the Board
      (or if there be no such determination, then in the order set forth on
Schedule
      E
      hereto),
      shall, in the absence of the Comptroller or in the event of the
      Comptroller’s

     

    
      
        
        

      

      
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    inability
      to act, perform the duties and exercise the powers of the Comptroller and shall
      perform such other duties and have such other powers as the Board may from
      time
      to time prescribe.

     

    g.   Officers
      as Agents.
      The
      Officers, to the extent of their powers set forth in this Agreement or otherwise
      vested in them by action of the Board not inconsistent with this Agreement,
      are
      agents of the Company for the purpose of the Company’s business, and, the
      actions of the Officers taken in accordance with such powers shall bind the
      Company.

     

    h.   Duties
      of Officers.
      Except
      as provided in this Agreement, in exercising their rights and performing their
      duties under this Agreement, the Officers shall have a fiduciary duty of loyalty
      and care similar to that of officers of a business corporation organized under
      the General Corporation Law of the State of Delaware.

     

    13.    Limited
      Liability.

     

    Except
      as
      otherwise expressly provided by the Act, the debts, obligations and liabilities
      of the Company, whether arising in contract, tort or otherwise, shall be the
      debts, obligations and liabilities solely of the Company, and neither the Member
      nor any Manager shall be obligated personally for any such debt, obligation
      or
      liability of the Company solely by reason of being the Member or Manager of
      the
      Company.

     

    14.   Capital
      Contributions.

     

    The
      Member shall be deemed admitted as the Member of the Company effective as of
      the
      date of this Agreement. The Member shall contribute the amount of cash to the
      Company listed on Schedule
      B
      attached
      hereto.

     

    15.    Additional
      Contributions.

     

    The
      Member is not required to make any additional capital contribution to the
      Company. To the extent that the Member makes an additional capital contribution
      to the Company, the Member shall revise Schedule
      B
      of this
      Agreement. The provisions of this Agreement, including this Section 15, are
      intended solely to benefit the Member and, to the fullest extent permitted
      by
      law, shall not be construed as conferring any benefit upon any creditor of
      the
      Company (and no such creditor of the Company shall be a third-party beneficiary
      of this Agreement) and the Member shall have no duty or obligation to any
      creditor of the Company to make any contribution to the Company or to issue
      any
      call for capital pursuant to this Agreement.

     

    16.    Allocation
      of Profits and Losses.

     

    The
      Company’s profits and losses shall be allocated to the Member.

     

    17.    Distributions.

     

    Distributions
      shall be made to the Member at the times and in the aggregate amounts determined
      by the Board. Notwithstanding any provision to the contrary contained in this
      Agreement, the Company shall not be required to make a distribution to the
      Member on

     

    
      
        
        

      

      
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    account
      of its interest in the Company if such distribution would violate the Act or
      any
      other applicable law.

     

    18.    Books
      and Records.

     

    The
      Board
      shall keep or cause to be kept complete and accurate books of account and
      records with respect to the Company’s business. The books of the Company shall
      at all times be maintained by the Board. The Member and its duly authorized
      representatives shall have the right to examine the Company books, records
      and
      documents during normal business hours. The Company’s books of account shall be
      kept using the method of accounting determined by the Member. The Company’s
      independent auditor shall be an independent public accounting firm selected
      by
      the Member.

     

    19.    Exculpation
      and Indemnification.

     

    a.   No
      Member, Officer, Manager, employee or agent of the Company and no employee,
      representative, agent or Affiliate of the Member (collectively, the “Covered
      Persons”) shall be liable to the Company or any other Person who is bound by
      this Agreement for any loss, damage or claim incurred by reason of any act
      or
      omission performed or omitted by such Covered Person in good faith on behalf
      of
      the Company and in a manner reasonably believed to be within the scope of the
      authority conferred on such Covered Person by this Agreement, except that a
      Covered Person shall be liable for any such loss, damage or claim incurred
      by
      reason of such Covered Person’s willful misconduct.

     

    b.   To
      the
      fullest extent permitted by applicable law, a Covered Person shall be entitled
      to indemnification from the Company for any loss, damage or claim incurred
      by
      such Covered Person by reason of any act or omission performed or omitted by
      such Covered Person in good faith on behalf of the Company and in a manner
      reasonably believed to be within the scope of the authority conferred on such
      Covered Person by this Agreement, except that no Covered Person shall be
      entitled to be indemnified in respect of any loss, damage or claim incurred
      by
      such Covered Person by reason of such Covered Person’s willful misconduct with
      respect to such acts or omissions; provided,
      however,
      that
      any indemnity under this Section 19 shall be provided out of and to the extent
      of Company assets only, and no Member shall have personal liability on account
      thereof.

     

    c.   To
      the
      fullest extent permitted by applicable law, expenses (including legal fees)
      incurred by a Covered Person defending any claim, demand, action, suit or
      proceeding shall, from time to time, be advanced by the Company prior to the
      final disposition of such claim, demand, action, suit or proceeding upon receipt
      by the Company of an undertaking by or on behalf of the Covered Person to repay
      such amount if it shall be determined that the Covered Person is not entitled
      to
      be indemnified as authorized in this Section 19.

     

    d.   A
      Covered
      Person shall be fully protected in relying in good faith upon the records of
      the
      Company and upon such information, opinions, reports or statements presented
      to
      the Company by any Person as to matters the Covered Person reasonably believes
      are within such other Person’s professional or expert competence and who has
      been selected with reasonable care by or on behalf of the Company, including
      information, opinions, reports or

     

    
      
        
        

      

      
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    statements
      as to the value and amount of the assets, liabilities, or any other facts
      pertinent to the existence and amount of assets from which distributions to
      the
      Member might properly be paid.

     

    e.   To
      the
      extent that, at law or in equity, a Covered Person has duties (including
      fiduciary duties) and liabilities relating thereto to the Company or to any
      other Covered Person, a Covered Person who is bound by this Agreement acting
      under this Agreement shall not be liable to the Company or to any other Covered
      Person for its good faith reliance on the provisions of this Agreement or any
      approval or authorization granted by the Company or any other Covered Person.
      The provisions of this Agreement, to the extent that they restrict the duties
      and liabilities of a Covered Person otherwise existing at law or in equity,
      are
      agreed by the Member to replace such other duties and liabilities of such
      Covered Person.

     

    f.    The
      foregoing provisions of this Section 19 shall survive any termination of this
      Agreement.

     

    20.    Assignments.

     

    The
      Member may assign in whole or in part its limited liability company interest
      in
      the Company. Subject to Section 21, if the Member transfers any or all of its
      limited liability company interest in the Company pursuant to this Section
      20,
      the transferee shall be admitted to the Company as a member of the Company
      upon
      its execution of an instrument signifying its agreement to be bound by the
      terms
      and conditions of this Agreement, which instrument may be a counterpart
      signature page to this Agreement. If the Member transfers all of its limited
      liability company interest in the Company, such admission shall be deemed
      effective immediately prior to the transfer, and, immediately following such
      admission, the transferor Member shall cease to be a member of the
      Company.

     

    21.    Admission
      of New Members.
      

     

    No
      new
      Member shall be admitted, either by a transfer of a portion of the Member’s
      interest, or in any other manner, which causes the Company to have two or more
      Members, until this Agreement has been amended to provide for such admission,
      including amendments relating to the governance of the Company, and such
      amendment has been accepted by the existing Member and the new
      Member.

     

    22.    Tax
      Characterization.
      

     

    The
      Member acknowledges that at all times that two or more persons or entities
      hold
      equity interests in the Company for federal income tax purposes (i) it is the
      intention of the Company to be treated as a “partnership” for federal and all
      relevant state tax purposes, and (ii) the Company will be treated as a
“partnership” for federal and all relevant state tax purposes and shall make all
      available elections to be so treated. Until such time, however, it is the
      intention of the Member that the Company be disregarded for federal and all
      relevant state tax purposes and that the activities of the Company be deemed
      to
      be activities of the Member for such purposes. All provisions of the Company’s
      certificate of formation and this Agreement are to be construed so as to
      preserve that tax status under those circumstances.

     

    
      
        
        

      

      
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    23.    Tax
      Elections.
      

     

    In
      accordance with the provisions of Treasury Regulations section 301.7701-3,
      the
      Company will not elect to be treated as a corporation for Federal income tax
      purposes, and therefore will be treated as either a disregarded entity or a
      division of the Member. Any other election under any provision of any tax law
      shall be made only by the Board or by a person authorized to do so by the
      Board.

     

    24.    Dissolution.

     

    a.   The
      Company shall be dissolved, and its affairs shall be wound up, upon the first
      to
      occur of the following: (i) the retirement, resignation or dissolution of the
      Member or the occurrence of any other event which terminates the continued
      membership of the Member unless the business of the Company is continued in
      a
      manner permitted by the Act or (ii) the entry of a decree of judicial
      dissolution under Section 18-802 of the Act.

     

    b.   The
      bankruptcy (as defined in Sections 18-101(1) and 18-304 of the Act) of the
      Member shall not cause the Member to cease to be a member of the Company and
      upon the occurrence of such an event, the Company shall continue without
      dissolution.

     

    c.   In
      the
      event of dissolution, the Company shall conduct only such activities as are
      necessary to wind up its affairs (including the sale of the assets of the
      Company in an orderly manner), and the assets of the Company shall be applied
      in
      the manner, and in the order of priority, set forth in Section 18-804 of the
      Act.

     

    25.    Waiver
      of Partition; Nature of Interest.

     

    Except
      as
      otherwise expressly provided in this Agreement, to the fullest extent permitted
      by law, the Member hereby irrevocably waives any right or power that it might
      have to cause the Company or any of its assets to be partitioned, to cause
      the
      appointment of a receiver for all or any portion of the assets of the Company,
      to compel any sale of all or any portion of the assets of the Company pursuant
      to any applicable law or to file a complaint or to institute any proceeding
      at
      law or in equity to cause the dissolution, liquidation, winding up or
      termination of the Company. The Member shall not have any interest in any
      specific assets of the Company, and the Member shall not have the status of
      a
      creditor with respect to any distribution pursuant to Section 17 hereof. The
      interest of the Member in the Company is personal property.

     

    26.    Benefits
      of Agreement; No Third-Party Rights.

     

    None
      of
      the provisions of this Agreement shall be for the benefit of or enforceable
      by
      any creditor of the Company or by any creditor of the Member. Nothing in this
      Agreement shall be deemed to create any right in any Person (other than Covered
      Persons) not a party hereto, and this Agreement shall not be construed in any
      respect to be a contract in whole or in part for the benefit of any third
      Person.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    27.    Other
      Business.

     

    The
      Member may engage in or possess an interest in other business ventures
      (unconnected with the Company) of every kind and description, independently
      or
      with others. The Company shall not have any rights in or to such independent
      ventures or the income or profits therefrom by virtue of this
      Agreement.

     

    28.    Severability
      of Provisions.

     

    Each
      provision of this Agreement shall be considered severable and if for any reason
      any provision or provisions herein are determined to be invalid, unenforceable
      or illegal under any existing or future law, such invalidity, unenforceability
      or illegality shall not impair the operation of or affect those portions of
      this
      Agreement which are valid, enforceable and legal.

     

    29.    Entire
      Agreement.

     

    This
      Agreement constitutes the entire agreement of the parties with respect to the
      subject matter hereof.

     

    30.    Governing
      Law.

     

    This
      Agreement shall be governed by and construed under the laws of the State of
      Delaware (without regard to conflicts of law principles), all rights and
      remedies being governed by said laws.

     

    31.    Amendments.

     

    This
      Agreement may not be modified, altered, supplemented or amended except pursuant
      to a written agreement executed and delivered by the Member.

     

    32.    Counterparts.

     

    This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      deemed an original of this Agreement and all of which together shall constitute
      one and the same instrument.

     

    33.    Notices.

     

    Any
      notices required to be delivered hereunder shall be in writing and personally
      delivered, mailed or sent by telecopy, electronic mail, or other similar form
      of
      rapid transmission, and shall be deemed to have been duly given upon receipt
      (a)
      in the case of the Company, by the Company at its address in Section 3, (b)
      in
      the case of the Member, by the Member at its address as listed on Schedule
      B
      attached
      hereto and (c) in the case of either party, by such party at such other address
      as may be designated by written notice to the other party.

     

    [SIGNATURE
      PAGE FOLLOWS]

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    


    IN
      WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has
      duly
      executed this Agreement as of the date first written above.

     

    JERSEY
      CENTRAL POWER & LIGHT COMPANY,

    as
      sole
      member

     

    By: 
      /s/ Richard H. Marsh                      

    Name: 
      Richard H. Marsh

    Title:   
      Senior Vice President and Chief Financial Officer

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    


    SCHEDULE
      A

     

    Definitions

     

    A.    Definitions

     

    When
      used
      in this Agreement, the following terms not otherwise defined herein have the
      following meanings:

     

    “Act”
has
      the
      meaning set forth in the preamble to this Agreement.

     

    “Affiliate”
means,
      with respect to any Person, any other Person directly or indirectly Controlling
      or Controlled by or under direct or indirect common Control with such
      Person.

     

    “Agreement”
means
      this Limited Liability Company Agreement of the Company, together with the
      schedules attached hereto, as amended, restated or supplemented from time to
      time.

     

    “Board”
or
      “Board
      of Managers”
means
      the Board of Managers of the Company.

     

    “Certificate
      of Formation”
means
      the Certificate of Formation of the Company to be filed with the Secretary
      of
      State of the State of Delaware on March 29, 2004, as amended or amended and
      restated from time to time.

     

    “Control”
means
      the possession, directly or indirectly, or the power to direct or cause the
      direction of the management or policies of a Person, whether through the
      ownership of voting securities or general partnership or managing member
      interests, by contract or otherwise. “Controlling” and “Controlled” shall have
      correlative meanings. Without limiting the generality of the foregoing, a Person
      shall be deemed to Control any other Person in which it owns, directly or
      indirectly, a majority of the ownership interests.

     

    “Company”
means
      JCP&L Transition Funding II LLC, a Delaware limited liability
      company.

     

    “Management
      Agreement”
means
      the agreement of the Managers substantially in the form attached hereto as
      Schedule D. The Management Agreement shall be deemed to be and constitute part
      of this Agreement.

     

    “Managers”
means
      the Managers elected to the Board of Managers from time to time by the Member.
      A
      Manager is hereby designated as a “manager” of the Company within the meaning of
      Section 18-101(10) of the Act.

     

    “Member”
means
      Jersey Central Power & Light Company and includes any Person admitted as an
      additional member of the Company or a substitute member of the Company pursuant
      to the provisions of this Agreement, each in its capacity as a member of the
      Company.

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

     

    “Officer”
means
      an officer of the Company described in Section 12.

     

    “Person”
means
      any individual, corporation, partnership, joint venture, limited liability
      company, limited liability partnership, association, joint-stock company, trust,
      unincorporated organization, or other organization, whether or not a legal
      entity, and any governmental authority.

     

    B.    Rules
      of Construction

     

    Definitions
      in this Agreement apply equally to both the singular and plural forms of the
      defined terms. The words “include” and “including” shall be deemed to be
      followed by the phrase “without limitation.” The terms “herein,” “hereof’ and
“hereunder” and other words of similar import refer to this Agreement as a whole
      and not to any particular Section, paragraph or subdivision. The Section titles
      appear as a matter of convenience only and shall not affect the interpretation
      of this Agreement. All Section, paragraph, clause, Exhibit or Schedule
      references not attributed to a particular document shall be references to such
      parts of this Agreement.

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

       

    

    SCHEDULE
      B

     

    Member

     

    
      	
              Name

               

            	
              Mailing
                Address

               

            	
              Agreed
                Value of
Capital
                Contribution

               

            	
              Percentage
Interest 

               

            
	
              Jersey
                Central Power & Light Company

            	
              c/o
                FirstEnergy Service Company

              76
                South Main St.

              Akron,
                OH 44308

            	
              $1,000

            	
              100%

            


    

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    


    SCHEDULE
      C

     

    Managers

     

    
      
        	
                Name

                 

              	
                Address

              
	
                Anthony
                  J. Alexander

              	
                c/o
                  FirstEnergy Service Company

                76
                  South Main St.

                Akron,
                  OH 44308

                 

              
	
                Richard
                  H. Marsh

              	
                c/o
                  FirstEnergy Service Company

                76
                  South Main St.

                Akron,
                  OH 44308

                 

              
	
                Thomas
                  C. Navin

              	
                c/o
                  FirstEnergy Service Company

                76
                  South Main St.

                Akron,
                  OH 44308

                 

              


      

    

     

    
      
        
        

      

      
        C-1

        
          

        

      

      
        
        

      

       

    

    SCHEDULE
      D

     

    Management
      Agreement

     

     

    ________
      __, 200_

     

    JCP&L
      Transition Funding II LLC 

    c/o
      FirstEnergy Service Company

    76
      South
      Main St.

    Akron,
      OH
      44308

     

    Re: Management
      Agreement 

     

    JCP&L
      Transition Funding II LLC

     

    Ladies
      and Gentlemen:

     

    For
      good
      and valuable consideration, each of the undersigned persons, who have been
      designated as managers of JCP&L Transition Funding II LLC, a Delaware
      limited liability company (the “Company”), in accordance with the Limited
      Liability Company Agreement of the Company, dated as of March 29, 2004, as
      it
      may be amended or restated from time to time (the “LLC Agreement”), hereby agree
      as follows:

     

    1.    Each
      of
      the undersigned accepts such person’s rights and authority as a Manager (as
      defined in the LLC Agreement) under the LLC Agreement and agrees to perform
      and
      discharge such person’s duties and obligations as a Manager under the LLC
      Agreement, and further agrees that such rights, authorities, duties and
      obligations under the LLC Agreement shall continue until such person’s successor
      as a Manager is designated or until such person’s resignation or removal as a
      Manager in accordance with the LLC Agreement. Each of the undersigned agrees
      and
      acknowledges that he has been designated as a “manager” of the Company within
      the meaning of the Delaware Limited Liability Company Act.

     

    2.    THIS
      MANAGEMENT AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
      THE
      LAWS OF THE STATE OF DELAWARE, AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED
      BY
      SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

    


    
      
        
        

      

      
        D-1

        
          

        

      

      
        
        

      

    

    


    IN
      WITNESS WHEREOF, the undersigned have executed this Management Agreement as
      of
      the day and year first above written.

     

    
      
        	 	 
	 	
                Name:
                  Anthony J. Alexander

                 

              
	 	
                Name:
                  Richard H. Marsh

                 

              
	 	
                Name:
                  Thomas C. Navin

                 

              


      

    

     

    
      
        
        

      

      
        D-2

        
          

        

      

      
        
        

      

    


    SCHEDULE
      E

     

    

      
        	
                Officers

                 

              	
                Title

                 

              
	
                Stephen
                  E. Morgan

                 

              	
                President

                 

              
	
                Richard
                  H. Marsh

                 

              	
                Senior
                  Vice President and Chief Financial Officer

                 

              
	
                Leila
                  L. Vespoli

                 

              	
                Senior
                  Vice President and General Counsel

                 

              
	
                Harvey
                  L. Wagner

                 

              	
                Vice
                  President and Controller

                 

              
	
                David
                  W. Whitehead

                 

              	
                Corporate
                  Secretary

                 

              
	
                Thomas
                  C. Navin

                 

              	
                Treasurer

                 

              
	
                Paulette
                  R. Chatman

                 

              	
                Assistant
                  Controller

                 

              
	
                Jeffrey
                  R. Kalata

                 

              	
                Assistant
                  Controller

                 

              
	
                Randy
                  Scilla 

                 

              	
                Assistant
                  Treasurer

                 

              
	
                Edward
                  J. Udovich

                 

              	
                Assistant
                  Corporate Secretary

                 

              


      

    

     

    
      
        
        

      

      
        E-1