File No. 70-[ ]
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
APPLICATION OR DECLARATION
ON
FORM U-1
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Ameren Corporation
1901 Chouteau Avenue
St. Louis, Missouri 63103
(Name of company or companies filing this statement
and address of principal executive offices)
Ameren Corporation
(Names of top registered holding company parent
of each applicant or declarant)
Steven R. Sullivan
Vice President and Secretary
Ameren Services Company
1901 Chouteau Avenue
St. Louis, Missouri 63103
(Name and address of agent for service)
The Commission is requested to mail signed copies of all orders,
notices and communications to:
William J. Niehoff, Esq William T. Baker, Jr., Esq.
Ameren Services Company Thelen Reid & Priest LLP
1901 Chouteau Avenue 40 West 57th Street
P.O. Box 66149, MC 1310 New York, New York 10019-4097
St. Louis, Missouri 63166-6149
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ITEM 1. DESCRIPTION OF PROPOSED TRANSACTION.
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I. INTRODUCTION
Ameren Corporation ("Ameren" or the "Company"), a registered
holding company under the Public Utility Holding Company Act of
1935, as amended (the "Act"), owns all of the issued and
outstanding Common Stock of Union Electric Company and Central
Illinois Public Service Company (collectively, the "Operating
Companies") and various direct and indirect non-utility
subsidiaries.* Ameren is proposing herein to implement a
shareholders rights plan.
II. BACKGROUND FOR PROPOSED RIGHTS DIVIDEND
Unsolicited attempts to acquire public companies have
required boards of directors and their shareholders to make
difficult decisions affecting the value, and on occasion the
existence, of companies within extremely short time periods.
Such takeover attempts often occur when a company is particularly
vulnerable and when its board has determined that the company's
inherent long term values are inadequately recognized by the
marketplace. Many of these attempts have involved partial or
two-tiered offers, the breakup of the corporate structure and
sale of assets, or have taken the form of creeping acquisitions
of stock that deprive shareholders of participation in a control
premium.
The changing regulatory environment (including the possible
repeal or amendment of the Act) suggests that public utility
holding companies, such as Ameren, and their shareholders are
losing to some degree the regulatory protection against hostile
acquisitions that they formerly had. Recent significant
developments in the utility industry have also resulted in
increased takeover activity, including hostile or other unwanted
takeover bids, further indicating that Ameren's shareholders may
be at risk of losing the long-term value of Ameren.
Shareholder rights plans have become a widely accepted means
to maximize shareholder value by reducing the risk of
nonrealization of shareholder value due to opportunistic takeover
proposals. Adoption of such a plan by Ameren would encourage
potential acquirors to negotiate with the Board of Directors of
Ameren ("Board") and to assist it in obtaining the highest value
for Ameren's shareholders, especially in a hostile or unwanted
takeover situation. The plan may, in certain circumstances,
permit the Board to thwart an inadequate offer. A shareholder
rights plan would also provide the Board with a role
(supplemental to the role of the Securities and Exchange
Commission (the "Commission") under the Act) in discouraging
implicitly coercive takeover tactics and would enable the Board
to provide holders of Ameren's common stock, $.01 par value per
share (the "Common Stock"), adequate time to properly assess a
takeover bid without undue pressure. Moreover, a shareholder
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* See Ameren Corporation et al., HCAR No. 26809 (December 30, 1997).
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rights plan may enhance the probability that a competing bid will
emerge. Over 2,000 American public companies have adopted rights
plans, including over 55% of the S&P 500 companies and over 45%
of the Business Week 1000 companies, and at least 29 public
utility companies. Indeed, the Commission has approved the
adoption of shareholder rights plans. See, e.g., Consolidated
Natural Gas Company, HCAR No. 26434 (December 19, 1995);
National Fuel Gas Company, HCAR No. 26532 (June 12, 1996); New
Century Energies, Inc., HCAR No. 26751 (August 1, 1997); and
Conectiv, Inc., HCAR No. 26861 (April 22, 1998).
A shareholder rights plan, however, would not make Ameren
acquisition-proof nor preclude a proxy contest. A shareholder
rights plan protects against takeover abuses, it gives all
parties an increased period of time in which to make decisions on
fundamental questions such as a takeover, and it strengthens the
ability of the Board to fulfill its fiduciary duties in
considering an offer that gives maximum long-term value to all
holders of Common Stock and could, under appropriate conditions,
require the Board to redeem the rights and allow the transaction
to proceed.
III. DESCRIPTION OF RIGHTS TO PURCHASE PREFERRED STOCK
General
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The Board proposes to declare a dividend distribution of one
preferred share purchase right (a "Right") for each outstanding
share of Common Stock. The distribution will be payable on a
record date (the "Record Date") yet to be established. Each
Right would entitle the registered holder to purchase from the
Company one one-hundredth of a share of Series A Junior
Participating Preferred Stock, $.01 par value per share (the
"Preferred Stock"), at a price per one one-hundredth share to be
determined by the Board (the "Purchase Price"), subject to
adjustment. The Purchase Price is expected to be set at an
amount equal to approximately three to five times the current
market price of the Common Stock, which premium is consistent
with that used by other companies in setting the purchase price
for their rights. The description and terms of the Rights are
set forth in a Rights Agreement (the "Rights Agreement") between
the Company and the Rights Agent to be named therein (the "Rights
Agent"), a draft of which is incorporated by reference as Exhibit
A-3.
Distribution Date; Transfer of Rights
-------------------------------------
Until the earlier to occur of (i) the tenth day following
the date of a public announcement that any individual, firm,
corporation or other entity, including any successor of such
entity (each, a "Person"), or group of affiliated or associated
Persons (not including the Company, any subsidiary of the
Company, an employee benefit plan of the Company or of a
subsidiary of the Company or other entity holding Common Stock
for or pursuant to the terms of such plan) (an "Acquiring
Person") acquired, or obtained the right to acquire, beneficial
ownership of Common Stock aggregating 15% or more of the then
outstanding shares of Common Stock or (ii) the tenth day (or such
later date as may be determined by action of the Board prior to
the time any Person or group of affiliated Persons becomes an
Acquiring Person) after the date of commencement or announcement
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of an intention to commence a tender offer or exchange offer the
consummation of which would result in such Person acquiring, or
obtaining the right to acquire or vote, beneficial ownership of
Common Stock aggregating 15% or more of the then outstanding
shares of Common Stock (the earlier of such dates being called
the "Distribution Date"), the Rights will be evidenced, with
respect to any of the Company's Common Stock certificates
outstanding as of the Record Date, by such Common Stock
certificates. The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferable only in
connection with the transfer of Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the
Rights), new Common Stock certificates issued after the Record
Date upon transfer or new issuance of the Common Stock will
contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any of
the Company's Common Stock certificates outstanding as of the
Record Date will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Company's Common Stock as of
the close of business on the Distribution Date and such separate
Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire at the close of business on October 9,
2008, unless earlier redeemed or exchanged by the Company as
described below.
Exercise of Rights for Common Stock of the Company
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In the event that a Person becomes an Acquiring Person, each
holder of a Right will thereafter have the right to buy, upon
exercise, that number of shares of Common Stock (or, in certain
circumstances, Preferred Stock) having a market value equal to
two times the exercise price of the Right. Notwithstanding any
of the foregoing, following the occurrence of any of the events
set forth in this paragraph, all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person will be null and void.
Exercise of Rights for Shares of the Acquiring Company
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In the event, directly or indirectly, at any time after a
Person has become an Acquiring Person, (i) the Company shall
consolidate with, or merge with and into, any other Person, (ii)
any Person shall consolidate with, or merge with and into, the
Company, or (iii) the Company shall sell or otherwise transfer
(or one of its subsidiaries shall sell or otherwise transfer), in
one or more transactions, 50% or more of the assets or earning
power of the Company and its subsidiaries (taken as a whole) to
any Person other than the Company or one or more of its wholly-
owned subsidiaries, each holder of a Right (except Rights which
previously have been voided as set forth above) shall thereafter
have the right to buy, upon exercise, that number of shares of
common stock of the acquiring company having a market value equal
to two times the exercise price of the Right.
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Adjustments to Purchase Price
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The Purchase Price, the number of shares of Preferred Stock
covered by each Right and the number of Rights outstanding are
subject to adjustment from time to time to prevent dilution (i)
in the event of a stock dividend on, or a subdivision,
combination or reclassification of the Preferred Stock, (ii) upon
the grant to holders of the Preferred Stock of certain rights or
warrants to subscribe for shares of the Preferred Stock or
securities convertible into Preferred Stock or equivalent
preferred stock at less than the current market price of the
Preferred Stock, or (iii) upon the distribution to holders of the
Preferred Stock of evidences of indebtedness or assets (other
than a regular quarterly cash dividend or a dividend payable in
Preferred Stock) or of subscription rights or warrants (other
than those referred to above).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. The Company
shall not be required to issue fractions of Preferred Stock
(other than fractional shares which are integral multiples of one
one-hundredth of a share of Preferred Stock) and, in lieu
thereof, an adjustment in cash will be made based on the market
price of a share of Preferred Stock on the last trading date
prior to the date of exercise.
Redemption and Exchange of Rights
---------------------------------
At any time after a Person becomes an Acquiring Person and
before the acquisition by such Person of 50% or more of the
outstanding Common Stock of the Company, the Board may exchange
the Rights (other than Rights owned by an Acquiring Person which
shall have become void), in whole or in part, at an exchange
ratio of one share of Common Stock (or one one-hundredth of a
share of Preferred Stock) per Right, subject to adjustment.
At any time prior to a Person becoming an Acquiring Person,
the Board may redeem the Rights in whole, but not in part, at a
price of $.01 per Right, subject to adjustment (the "Redemption
Price"). Immediately upon the action of the Board ordering the
redemption of the Rights or the exchange of any Rights,
respectively, the Company shall promptly give public notice of
any such exchange or redemption, and upon such action, the right
to exercise the Rights will terminate and the only right of the
holders of the Rights will be to receive the Redemption Price.
Until a Right is exercised or exchanged, the holder thereof,
as such, will have no rights as a shareholder of the Company,
including, without limitation, the right to vote or to receive
dividends.
Terms of the Preferred Stock
----------------------------
The Preferred Stock will rank junior to all other series of
any other class of the Company's preferred stock with respect to
the payment of dividends and the distribution of assets in
liquidation. Each share of Preferred Stock shall be entitled to
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receive, when, as and if declared by the Board out of funds
legally available for the purpose, quarterly dividends per share
equal to the greater of $1.00 or 100 times the aggregate per
share amount of any dividend (other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares
of Common Stock) declared on the Common Stock since the last
quarterly dividend period, subject to certain adjustments. The
Preferred Stock will not be redeemable. In the event of
liquidation, the holders of the Preferred Stock will be entitled
to receive $100 per share (plus accrued and unpaid dividends),
provided that the holders of Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to adjustment,
equal to 100 times the aggregate amount to be distributed per
share to the holders of Common Stock. Generally, each share of
Preferred Stock will vote together with the Common Stock and any
other capital stock of the Company having general voting rights
and will be entitled to 100 votes, subject to certain
adjustments. In the event of any merger, consolidation,
combination or other transaction in which shares of Common Stock
are exchanged for or changed into other stock or securities, cash
and/or other property, each share of Preferred Stock shall at the
same time be similarly exchanged or changed into an amount per
share, subject to certain adjustments, equal to 100 times the
aggregate amount of stock, securities, cash and/or other property
into which or for which each share of Common Stock is changed or
exchanged. The foregoing dividend, voting and liquidation rights
of the Preferred Stock are protected against dilution in the
event that additional shares of Common Stock are issued pursuant
to a stock split or stock dividend or distribution. Because of
the nature of the Preferred Stock's dividend, voting, liquidation
and other rights, the value of the one one-hundredth of a share
of Preferred Stock purchasable with each Right is intended to
approximate the value of one share of Common Stock.
Amendments to Terms of the Rights
---------------------------------
The Board may, from time to time, amend the Rights Agreement
without the consent of the holders of the Rights in order to
correct or supplement any provision which may be defective or
inconsistent with any other provisions, or to make any other
provisions with respect to the Rights which the Company may deem
necessary and desirable. However, after the date that any Person
becomes an Acquiring Person, the Rights Agreement shall not be
amended in any manner which would adversely affect the interests
of the holders of the Rights. Without limiting the foregoing,
the Company may at any time prior to a Person becoming an
Acquiring Person amend the Rights Agreement to lower the 15%
thresholds (as specified in "Distribution Date; Transfer of
Rights" supra) to not less than the greater of (i) the sum of
.001% plus the largest percentage of the outstanding Common Stock
then known by the Company to be beneficially owned by any Person
(other than the Company, any subsidiary of the Company, an
employee benefit plan of the Company or of a subsidiary of the
Company or other entity holding Common Stock for or pursuant to
the terms of such plan) or (ii) 10%.
IV. AUTHORIZATIONS SOUGHT
Ameren herein seeks authorization to implement the
shareholder rights plan as described in this
Application-Declaration and embodied in the Rights Agreement.
This would include, among other actions permitted by the Rights
Agreement, the following transactions:
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(i) the dividend distribution of the Rights;
(ii) the making of adjustments to the Purchase Price;
(iii) the sale and issuance of Preferred Stock, Common Stock
or other Ameren securities, or the transfer of other
assets, upon exercise of the Rights;
(iv) the redemption of the Rights and the issuance of
Common Stock in connection therewith, and the issuance
of Common Stock or other Ameren securities, or the
transfer of other assets, in exchange for the Rights;
and
(v) amending of the Rights Agreement as permitted by the
terms thereof.
ITEM 2. FEES, COMMISSIONS AND EXPENSES.
-------------------------------
It is estimated that the fees, commissions and expenses
ascertainable at this time to be incurred by Ameren in connection
with the proposed transactions will be as follows:
Rights Agent Fees $ *
Outside Counsel's Fees & Advisor's Fees $ *
Printing and Mailing Costs $25,000
Miscellaneous Expenses $ 5,000
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$ *
* To be filed by amendment.
ITEM 3. APPLICABLE STATUTORY PROVISIONS.
--------------------------------
Sections 6(a), 7, 9(a), 10 and 12(c) of the Act and Rule 42
under the Act are deemed to be applicable to the proposed
dividend distribution of the Rights, and any subsequent exercise
or redemption of the Rights.
While the Rights are technically a dividend on the Common
Stock for corporate law purposes, in and of themselves they have
no economic value and, therefore, are not a "dividend" out of
capital or capital surplus for the purpose of Section 12(c) of
the Act.
Because there is no intent that the Rights ever become
exercisable, they are regarded more appropriately as being in the
nature of an addition to the rights of shareholders under
Sections 6(a)(2) and 7(e) rather than as an issuance of
securities under Section 6(a)(1) and 7(c) and (d). However, if
such latter sections were to be regarded as applicable, then any
issuance of shares of Preferred Stock or Common Stock pursuant to
the Rights are deemed to meet the requirements of Section
7(c)(2)(D) and none of the negative findings required under
Section 7(d) can be made.
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To the extent that the proposed transactions are considered
by the Commission to require authorization, approval or exemption
under any section of the Act or provision of the rules or
regulations other than those specifically referred to herein,
request for such authorization, approval or exemption is hereby
made.
The proposed transactions are also subject to the
requirements of Section 32(h)(4) and Rule 54 thereunder.
Statement pursuant to Rule 54
-----------------------------
Under Rule 53(a), the Commission shall not make certain
specified findings under Sections 7 and 12 in connection with a
proposal by a holding company to issue securities for the purpose
of acquiring the securities of or other interest in an exempt
wholesale generator ("EWG"), or to guarantee the securities of an
EWG, if each of the conditions in paragraphs (a)(1) through
(a)(4) thereof are met, provided that none of the conditions
specified in paragraphs (b)(1) through (b)(3) of Rule 53 exists.
Rule 54 provides that the Commission shall not consider the
effect of the capitalization or earnings of subsidiaries of a
registered holding company that are EWGs or foreign utility
companies ("FUCOs") in determining whether to approve other
transactions if Rule 53(a), (b) and (c) are satisfied. These
standards are met.
Rule 53(a)(1): Currently, Ameren does not hold, directly or
indirectly, any interest in any EWG or FUCO.
Rule 53(a)(2): Ameren will maintain books and records
enabling it to identify investments in and earnings from each EWG
and FUCO in which it directly or indirectly acquires and holds an
interest and will cause each domestic EWG in which it acquires
and holds an interest to maintain its books and records and
prepare its financial statements in conformity with U.S.
generally accepted accounting principles ("GAAP"). The books and
records and financial statements of each FUCO in which Ameren
acquires and holds an interest (including those that are
"majority-owned subsidiaries" and those that are not) will be
maintained and prepared in conformity with GAAP. All of such
books and records and financial statements will be made available
to the Commission, in English, upon request.
Rule 53(a)(3): No more than 2% of the employees of the
Operating Companies will, at any one time, directly or
indirectly, render services to EWGs and FUCOs.
Rule 53(a)(4): Ameren will submit a copy of each
Application or Declaration filed pursuant to Rule 53 and each
amendment thereto, and will submit copies of any Rule 24
certificates required thereunder, as well as a copy of Ameren's
Form U5S, to each of the public service commissions having
jurisdiction over the retail rates of the Operating Companies.
In addition, Ameren states that the provisions of Rule 53(a)
are not made inapplicable to the authorization herein requested
by reason of the provisions of Rule 53(b).
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Rule 53(b)(1): Neither Ameren nor any subsidiary of Ameren
is the subject of any pending bankruptcy or similar proceeding.
Rule 53(b)(2): Since the date upon which it became a
holding company, Ameren has not experienced any decrease in
average consolidated retained earnings.
Rule 53(b)(3): Ameren has not experienced any losses
attributable to EWGs and FUCOs.
ITEM 4. REGULATORY APPROVAL.
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No State commission and no other Federal commission has
jurisdiction over the proposed transactions.
ITEM 5. PROCEDURE.
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The applicant requests that the Commission's order be issued
as soon as the rules allow, and that there be no thirty-day
waiting period between the issuance of the Commission's order and
the date on which it is to become effective. The applicant
hereby waives a recommended decision by a hearing officer or
other responsible officer of the Commission and hereby consent
that the Division of Investment Management may assist in the
preparation of the Commission's decision and/or order in the
matter unless such Division opposes the matters covered hereby.
ITEM 6. EXHIBITS AND FINANCIAL STATEMENTS.
----------------------------------
The following exhibits are made a part of this statement:
(a) Exhibits
A-1 Restated Certificate of Incorporation of the
Company (incorporated by reference to Annex F to
the Registration Statement on Form S-4 filed on
November 13, 1995 (Registration No. 33-64165)).
A-2 Restated By-laws of the Company, effective
December 31, 1997 and currently in effect
(incorporated by reference to Exhibit 3(ii) to
Ameren's Annual Report on Form 10-K for the year
ended December 31, 1997 (File No. 1-14756)).
A-3 Draft of Rights Agreement, including exhibits
(incorporated by reference to Exhibit 4 to Ameren's
Current Report on Form 8-K for an event of October 9,
1998 (File No. 1-14756)).
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F Opinion of counsel (To be filed by amendment).
G Financial Data Schedule (incorporated by
reference to Exhibit 27 to Ameren's Quarterly
Report on Form 10-Q for the quarter ended June
30, 1998 (File No. 1-14756)).
H Proposed notice pursuant to Rule 22(f).
(b) Financial Statements
1 Balance Sheet of Ameren and subsidiaries as of June
30, 1998 (incorporated by reference to Ameren's
Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998 (File No. 1-14756)).
2 Statement of Income and surplus of Ameren and
subsidiaries (incorporated by reference to Ameren's
Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998 (File No. 1-14756)).
ITEM 7. INFORMATION AS TO ENVIRONMENTAL EFFECTS.
----------------------------------------
As more fully described in Item 1, the proposed transactions
subject to the jurisdiction of this Commission relate only to the
dividend of the Rights and any subsequent exercise, redemption or
exchange of the Rights and involve no major federal action
significantly affecting the quality of the human environment
within the meaning of the National Environmental Policy Act.
No other federal agency has prepared or is preparing an
environmental impact statement with regard to the proposed
transactions.
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SIGNATURES
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this
statement to be signed on its behalf by the undersigned thereunto
duly authorized.
AMEREN CORPORATION
By: /s/ Steven R. Sullivan
---------------------------
Name: Steven R. Sullivan
Title: Vice President
and Secretary
Date: October 14, 1998
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Exhibit Index
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Exhibit Description
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H Proposed notice pursuant to Rule 22(f).
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EXHIBIT H
FORM OF NOTICE OF PROPOSED TRANSACTIONS
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- ; 70- )
Filings under the Public Utility Holding Company Act of 1935
("Act").
Ameren Corporation ("Ameren")
October , 1998
--
Notice is hereby given that the following filing(s) has/have
been made with the Securities and Exchange Commission (the
"Commission") pursuant to provisions of the Act and rules
promulgated thereunder. All interested persons are referred to
the application(s) and/or declaration(s) for complete statements
of the proposed transaction(s) summarized below. The
application(s) and/or declaration(s) and any amendments thereto
is/are available for public inspection through the Commission's
Office of Public Reference.
Interested persons wishing to comment or request a hearing
on the application(s) and/or declaration(s) should submit their
views in writing by , 1998 to the Secretary,
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Securities and Exchange Commission, Washington, D.C. 20549, and
serve a copy on the relevant applicant(s) and/or declarant(s) at
the address specified below. Proof of service (by affidavit or,
in case of an attorney at law, by certificate) should be filed
with the request. Any request for hearing shall identify
specifically the issues of fact or law that are disputed. A
person who so requests will be notified of any hearing, if
ordered, and will receive a copy of any notice or order issued in
the matter. After said date, the application(s) and/or
declaration(s), as filed or as amended, may be granted and/or
permitted to become effective.
Ameren, 1901 Choteau Avenue, St. Louis, Missouri, 63103, a
registered holding company under the Act, has filed a declaration
under sections 6(a), 7, 9(a), 10, and 12(c) of the Act and rules
42 and 54 thereunder.
Ameren seeks authorization to implement a shareholder rights
plan ("Plan") and to enter into a related Rights Agreement
("Agreement") with an agent to be named therein. To implement
the Plan, the Board of Directors (the "Board") of Ameren would
declare a dividend distribution of one right ("Right") for each
outstanding share of common stock, $.01 par value ("Common
Stock"), of Ameren to shareholders of record at the close of
business on a specified record date. Each Right would entitle
the holder to purchase from Ameren one one-hundredth of a share
of Series A Junior Participating Preferred Stock, $.01 par value
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(the "Preferred Stock"), at a price per one one-hundredth share
to be determined by the Board, subject to adjustment ("Purchase
Price"). Initially the Rights will be evidenced by the
certificates for shares of Common Stock to which they relate and
will be transferable only with the Common Stock. Until a Right
is exercised or exchanged, as described below, the holder, as
such, will have no rights as a shareholder of Ameren.
Upon the earlier to occur of (i) the tenth day following the
date of a public announcement that any individual, firm,
corporation or other entity, including any successor of such
entity (each, a "Person"), or group of affiliated or associated
Persons (not including the company, any subsidiary of the
company, an employee benefit plan of the company or of a
subsidiary of the company or other entity holding Common Stock
for or pursuant to the terms of such plan) (an "Acquiring
Person") acquired, or obtained the right to acquire, beneficial
ownership of Common Stock aggregating 15% or more of the then
outstanding shares of Common Stock, or (ii) the tenth day after
commencement, or announcement of an intention to commence, a
tender offer or exchange offer, the consummation of which would
result in such Person acquiring, or obtaining the right to
acquire or vote, beneficial ownership of Common Stock aggregating
15% or more of the then outstanding shares of Common Stock (the
earlier of such dates being called the "Distribution Date"),
separate certificates evidencing the Rights will be mailed to
holders of record of the Common Stock as of the close of business
on the Distribution Date.
The Rights will become exercisable after the Distribution
Date on the following terms: (1) In the event that a Person
becomes an Acquiring Person, each holder of a Right (other than
an Acquiring Person) will have the right to buy, upon exercise,
that number of shares of Common Stock (or, in certain
circumstances, Preferred Stock) having a market value equal to
two times the exercise price of the Right. Rights that are
beneficially owned by an Acquiring Person will be null and void;
(2) If, after a Person becomes an Acquiring Person, (i) Ameren
shall consolidate with, or merge with and into, any other Person,
(ii) any Person shall consolidate with, or merge with and into
Ameren, or (iii) Ameren shall sell or otherwise transfer 50% or
more of its assets or earning power, each holder of a Right
(except Rights which previously have been voided) will have the
right to receive, upon exercise, that number of shares of common
stock of the acquiring company having a market value equal to two
times the exercise price of the Right.
The Purchase Price, the number of shares of Preferred Stock
covered by each Right and the number of Rights outstanding are
subject to adjustment to prevent dilution in certain situations
involving stock dividends, splits, combinations or
reclassification; grants of warrants to subscribe for or purchase
the Preferred Stock or convertible securities at less than market
price; or distribution to holders of the Preferred Stock of
evidences of indebtedness or assets or of subscription rights or
warrants. With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require at
least a 1% or more change in the Purchase Price.
The Board may redeem the Rights in whole, but not in part,
at any time prior to a Person becoming an Acquiring Person, at a
price of $.01 per Right, subject to adjustment. In addition, at
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any time after a Person becomes an Acquiring Person and before
the acquisition by such Person of more than 50% of the
outstanding Common Stock, the Board may exchange the Rights
(other than Rights owned by an Acquiring Person which shall have
become void), in whole or in part, at an exchange ratio of one
share of Common Stock (or one one-hundredth of a share of
Preferred Stock) per Right, subject to adjustment.
The Agreement may be amended or supplemented by the Board
without the consent of the holders of Rights in order to correct
or supplement any provision which may be defective or
inconsistent with any other provisions or to make any other
provisions with respect to the Rights which Ameren may deem
necessary and desirable. However, after the date that any Person
becomes an Acquiring Person, the Agreement shall not be amended
in any manner which would adversely affect the interests of the
holders of the Rights. Without limiting the foregoing, Ameren
may at any time prior to a Person becoming an Acquiring Person
amend the Agreement to lower the 15% thresholds for triggering a
"Distribution Date" to not less than the greater of (i) the sum
of .001% plus the largest percentage of the outstanding Common
Stock then known by Ameren to be beneficially owned by any Person
(other than the company, any subsidiary of the company, an
employee benefit plan of the company or of a subsidiary of the
company or other entity holding Common Stock for or pursuant to
the terms of such plan) or (ii) 10%.
* * *
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
Jonathan G. Katz
Secretary
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