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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
CIPSCO INCORPORATED
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(Name of Issuer)
Common Stock, without par value
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(Title of Class of Securities)
125539106
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(CUSIP Number)
James C. Thompson
Secretary
Union Electric Company
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
Copy to:
Seth A. Kaplan, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
(212) 403-1000
August 11, 1995
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this Schedule because of Rule 13d-l(b)(3) or (4), check the following
box: [ ]
Check the following box if a fee is being paid with this statement:
[X]
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CUSIP No. 125539106
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON.
Union Electric Company
I.R.S. Identification No. 43-0559760
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) ______
(b) ______
3. SEC USE ONLY
4. SOURCE OF FUNDS
WC/OO
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e)
N/A
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
State of Missouri
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
6,779,838/*/
8. SHARED VOTING POWER
0
9. SOLE DISPOSITIVE POWER
6,779,838/*/
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/*/ Beneficial ownership disclaimed. See Item 5 below.
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10. SHARED DISPOSITIVE POWER
0
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,779,838/*/
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.9%
14. TYPE OF REPORTING PERSON
CO
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/*/ Beneficial ownership disclaimed. See Item 5 below.
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Item 1. Security and Issuer.
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This statement relates to the common stock, without par value (the
"CIPSCO Common Stock"), of CIPSCO Incorporated, an Illinois corporation (the
"Company"). The principal executive offices of the Company are located at 607
East Adams Street, Springfield, Illinois 62739.
Item 2. Identity and Background.
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(a)-(c) and (f) This statement is being filed by Union Electric
Company, a Missouri corporation ("Union Electric"). The principal executive
offices of Union Electric are located at 1901 Chouteau Avenue, St. Louis,
Missouri 63103.
Union Electric is predominantly an operating public utility engaged in
the generation, transmission and distribution of electricity throughout a 24,500
square mile service area and the transportation and distribution of natural gas
in approximately 90 communities within this area. Union Electric serves
customers in Missouri and Illinois.
As to each of the executive officers and directors of Union Electric,
the name, business address, present principal occupation or employment and the
name and principal address of any corporation or other organization in which
such employment is indicated, are set forth on Schedule I hereto. Each of such
persons is a citizen of the United States.
(d) During the last five years, neither Union Electric nor, to the
best of Union Electric's knowledge, any of the
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individuals named in Schedule I hereto, has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors).
(e) During the last five years, neither Union Electric nor, to the
best of Union Electric's knowledge, any of the individuals named in Schedule I
hereto, has been a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
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Concurrent with entering into the Merger Agreement (as defined in Item
4 below), Union Electric was granted the Option (as defined in Item 4 below).
None of the triggering events permitting exercise of the Option have occurred as
of the date of this Schedule 13D. In the event that the Option becomes
exercisable and Union Electric wishes to purchase for cash the CIPSCO Common
Stock subject thereto, Union Electric will fund the exercise price from working
capital or through other sources, which could include borrowings.
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Item 4. Purpose of Transaction.
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Union Electric, the Company, Arch Holding Corp., a Missouri
corporation 50% owned by each of Union Electric and the Company ("Holdings") and
Arch Merger Inc., a Missouri corporation and a wholly owned subsidiary of
Holdings ("Merger Sub") have entered into an Agreement and Plan of Merger, dated
as of August 11, 1995 (the "Merger Agreement"), which provides for a strategic
business combination involving Union Electric and the Company (the
"Transaction"). The Transaction is expected to close shortly after all of the
conditions to the consummation of the Transaction, including obtaining
applicable regulatory approvals, are met or waived. The regulatory approval
process is expected to take approximately 12 to 18 months.
In the Transaction, Holdings, which is a newly formed holding company,
will become the parent of both Union Electric and Central Illinois Public
Service Company, the Company's principal operating subsidiary. Holdings will be
registered under the Public Utility Holding Company Act of 1935, as amended.
Holdings is expected to be renamed prior to consummation of the Transaction.
The Merger Agreement is incorporated herein by reference to Exhibit
2(a) to Union Electric's Quarterly Report on Form 10-Q/A, Amendment No. 1, for
the quarter ended June 30, 1995, which was filed with the Securities and
Exchange Commission (the "SEC") on August 15, 1995. The description of
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the Merger Agreement set forth herein does not purport to be complete and is
qualified in its entirety by the provisions of the Merger Agreement.
Under the terms of the Merger Agreement, Merger Sub will be merged
with and into Union Electric, with Union Electric as the surviving corporation,
and the Company will be merged with and into Holdings, with Holdings as the
surviving corporation (such transactions, the "Mergers"). As a result of the
Mergers, (i) each outstanding share of common stock, par value $5.00 per share
("UE Common Stock"), of Union Electric (other than shares with respect to which
dissenters' rights are perfected under applicable state laws, and other than
shares owned as treasury stock or otherwise directly or indirectly owned by
Union Electric, the Company, or any of their respective wholly owned
subsidiaries, which shares will be cancelled) will be converted into the right
to receive one share of common stock, par value $.01 per share, of Holdings
("Holdings Common Stock"), (ii) each outstanding share of preferred stock,
without par value, of Union Electric (other than shares with respect to which
dissenters' rights have been perfected under applicable state laws, and other
than shares owned as treasury stock or otherwise directly or indirectly owned by
Union Electric, the Company, or any of their respective wholly owned
subsidiaries, which shares will be cancelled) will remain outstanding and
unchanged and (iii) each share of CIPSCO Common
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Stock (including shares with respect to which dissenters' rights are perfected
under applicable state laws, but excluding shares owned as treasury stock or
otherwise directly or indirectly owned by Union Electric, the Company, or any of
their respective subsidiaries, which shares will be cancelled) will be converted
into the right to receive 1.03 shares of Holdings Common Stock (or cash in lieu
of fractional shares otherwise deliverable in respect thereof).
As of the date of the Merger Agreement, there were 102,123,834 shares
of UE Common Stock outstanding and 34,069,542 shares of CIPSCO Common Stock
outstanding. Based on such capitalization, the Transaction would result in the
common shareholders of Union Electric receiving approximately 74.4% of the
common equity of Holdings and the common shareholders of the Company owning
approximately 25.6% of the common equity of Holdings. The outstanding shares of
preferred stock of Union Electric will remain outstanding and be unchanged in
the Transaction and will continue to represent preferred stock of the surviving
corporation in the merger between Union Electric and Merger Sub.
The Transaction is subject to customary closing conditions, including,
without limitation, the receipt of required shareholder approvals of the Company
and Union Electric; and the receipt of all necessary governmental approvals and
the making of all necessary governmental filings, including appro-
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vals of state utility regulators in Missouri and Illinois, the approval of the
Federal Energy Regulatory Commission, the SEC, the Nuclear Regulatory
Commission, and the filing of the requisite notification with the Federal Trade
Commission and the Department of Justice under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the expiration of the applicable
waiting period thereunder. The Transaction is also subject to receipt of
opinions of counsel that the Transaction will qualify as a tax-free
reorganization, and of assurances from the parties' independent accountants that
the Transaction will qualify as a pooling of interests for accounting purposes.
In addition, the Transaction is conditioned upon the effectiveness of a
registration statement to be filed by Holdings with the SEC with respect to the
shares of Holdings Common Stock to be issued in the Transaction and the approval
for listing of such shares on the New York Stock Exchange. Shareholder meetings
to vote upon the Transaction will be convened as soon as practicable and are
expected to be held by the end of the fourth quarter of 1995.
The Merger Agreement contains certain covenants of the parties
regarding the conduct of their respective businesses pending the consummation of
the Transaction. Generally, the parties must carry on their businesses in the
ordinary
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course consistent with past practice, may not increase dividends on common stock
beyond specified levels, and may not issue any capital stock beyond certain
limits. The Merger Agreement also contains restrictions on, among other things,
charter and bylaw amendments, capital expenditures, acquisitions, dispositions,
incurrence of indebtedness, certain increases in employee compensation and
benefits, and affiliate transactions.
The Merger Agreement provides that, after the effectiveness of the
Mergers (the "Effective Time"), the corporate headquarters and principal
executive offices of Holdings will be located in St. Louis, Missouri. Holdings'
Board of Directors will consist of a total of 15 directors, 10 of whom will be
designated prior to the Effective Time by Union Electric and 5 of whom will be
designated prior to the Effective Time by the Company. At the Effective Time,
Mr. Charles W. Mueller, the current President and Chief Executive Officer of
Union Electric, will serve as Chairman and Chief Executive Officer of Holdings,
and Mr. Clifford L. Greenwalt, the current President and Chief Executive Officer
of the Company, will serve as Vice Chairman of Holdings.
The Merger Agreement may be terminated under certain circumstances,
including (1) by mutual consent of the parties; (2) by any party if the
Transaction is not consummated by August 11, 1997 (provided, however, that such
termination date shall be extended to February 11, 1998 if all conditions to
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closing the Transaction, other than the receipt of certain consents and/or
statutory approvals by any of the parties, have been satisfied by August 11,
1997); (3) by any party if either Union Electric's or the Company's shareholders
vote against the Transaction or if any state or federal law or court order
prohibits the Transaction; (4) by a non-breaching party if there exist breaches
of any representations or warranties contained in the Merger Agreement as of the
date thereof, which breaches, individually or in the aggregate, would result in
a material adverse effect on the breaching party and which is not cured within
twenty (20) days after notice; (5) by a non-breaching party if there occur
breaches of specified covenants or material breaches of any covenant or
agreement (including those contained in the Stock Option Agreements (as
hereinafter defined)), which are not cured within twenty (20) days after notice;
(6) by either party if the Board of Directors of the other party shall withdraw
or adversely modify its recommendation of the Transaction or shall approve any
competing transaction; (7) by either party, under certain circumstances, as a
result of a third-party tender offer or business combination proposal which such
party, pursuant to its directors' fiduciary duties, is, in the opinion of such
party's counsel and after the other party has first been given an opportunity to
make concessions and adjustments in the terms of the Merger Agreement, required
to accept or; (8) by either party if a third
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party acquires securities representing greater than 50% of the voting power of
the outstanding voting securities of such other party or if individuals who as
of the date of the Merger Agreement constitute the board of directors of such
other party (or replacements nominated and/or elected by a majority of such
directors) cease for any reason to constitute a majority of the board of
directors of such party then in office.
The Merger Agreement provides that if a breach described in clause (4)
or (5) of the previous paragraph occurs, then, if such breach is not willful,
the non-breaching party is entitled to reimbursement of its out-of-pocket
expenses, not to exceed $10 million. In the event of a willful breach, the non-
breaching party will be entitled to its out-of-pocket expenses (which shall not
be limited to $10 million) and any remedies it may have at law or in equity,
provided that if, at the time of the breaching party's willful breach, there
shall have been a third party tender offer or business combination proposal
which shall not have been rejected by the breaching party and withdrawn by the
third party, and within two and one-half years of any termination by the non-
breaching party, the breaching party accepts an offer to consummate or
consummates a business combination with such third party, then such breaching
party, upon the signing of a definitive agreement relating to such a business
combination, or, if no such agreement is signed then at
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the closing of such business combination, will pay to the non-breaching party an
additional fee equal to $30 million. The Merger Agreement also requires payment
of a termination fee of $30 million (and reimbursement of out-of-pocket
expenses) by one party (the "Payor") to the other in certain circumstances, if
(i) the Merger Agreement is terminated (x) as a result of the acceptance by the
Payor of a third-party tender offer or business combination proposal, (y)
following a failure of the shareholders of the Payor to grant their approval to
the Transaction or (z) as a result of the Payor's material failure to convene a
shareholder meeting, distribute proxy materials and, subject to its board of
directors' fiduciary duties, recommend the Transaction to its shareholders; and
(ii) at the time of such termination or prior to the meeting of such party's
shareholders there shall have been a third-party tender offer or business
combination proposal which shall not have been rejected by the Payor and
withdrawn by such third party; and (iii) within two and one-half years of any
such termination described in clause (i) above, the Payor accepts an offer to
consummate or consummates a business combination with such third party. Such
termination fee and out-of-pocket expenses referred to in the previous sentence
shall be paid upon the signing of a definitive agreement between the Payor and
the third party, or, if no such agreement is signed, then at the
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closing of such third-party business combination. The termination fees payable
by Union Electric or the Company under these provisions and the aggregate amount
which could be payable by Union Electric or the Company upon a required purchase
of the options granted pursuant to the Stock Option Agreements (as defined
below) may not exceed $50 million in the aggregate.
It is anticipated that Holdings will adopt Union Electric's dividend
payment level adjusted for the exchange ratio. The Merger Agreement provides
that the Articles of Incorporation and the Bylaws of the Company will be amended
in a manner to be agreed between Union Electric and the Company.
Concurrently with entering into the Merger Agreement, the Company and
Union Electric entered into stock option agreements pursuant to which, for no
additional consideration, (i) the Company granted to Union Electric an
irrevocable option to purchase under certain circumstances up 6,779,838 shares
of CIPSCO Common Stock (which equals approximately 19.9% of the number of shares
of CIPSCO Common Stock outstanding on August 11, 1995) (the "CIPSCO Stock Option
Agreement") and (ii) Union Electric granted to the Company an irrevocable option
to purchase under certain circumstances up to 6,983,233 shares of UE Common
Stock (which equals approximately 6.84% of the number of shares of UE Common
Stock outstanding on August 11, 1995) (the "UE Stock Option Agreement" and,
together with the CIPSCO Stock Option Agreement, the "Stock Option Agreements").
Under the CIPSCO
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Stock Option Agreement, the Company granted Union Electric an irrevocable option
to purchase (the "Option") up to 6,779,838 shares (subject to adjustment for
changes in capitalization) of CIPSCO Common Stock at an exercise price of $37.02
per share if the Merger Agreement becomes terminable under certain circumstances
by Union Electric. The exercise price is payable, at Union Electric's election,
in cash or shares of UE Common Stock. If the Option becomes exercisable, Union
Electric may request the Company to repurchase from Union Electric all or any
portion of the Option (or if the Option is exercised, to repurchase from Union
Electric all or any portion of the acquired shares of CIPSCO Common Stock) at
the price specified in the CIPSCO Stock Option Agreement.
Each party to the Stock Option Agreements agreed to vote, prior to
August 11, 2000, any shares of the capital stock of the other party acquired
pursuant to the Stock Option Agreements or otherwise beneficially owned by such
party on each matter submitted to a vote of shareholders of such other party for
and against such matter in the same proportion as the vote of all other
shareholders of such other party is voted for and against such matter.
The Stock Option Agreements provide that, prior to August 11, 2000,
neither party may sell, assign, pledge or otherwise dispose of or transfer the
shares it acquires pursuant to the Stock Option Agreements (collectively, the
"Restricted
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Shares") except as specifically provided for in the Stock Option Agreements. In
addition to the repurchase rights mentioned above, subsequent to the termination
of the Merger Agreement, the parties have the right to have such shares of the
other party registered under the Securities Act of 1933 for sale in a public
offering, unless the issuer of the shares elects to repurchase them at their
then market value. The Stock Option Agreements also provide that, following the
termination of the Merger Agreement, either party may sell any Restricted Shares
pursuant to a tender or exchange offer approved or recommended, or otherwise
determined to be fair and in the best interests of such other party's
shareholders, by a majority of the Board of Directors of such other party.
The Stock Option Agreements are incorporated herein by reference to
Exhibits 10(a) and 10(b) of Union Electric's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1995. The description of the Stock Option Agreements
set forth herein does not purport to be complete and is qualified in its
entirety by the provisions of the Stock Option Agreements.
Pursuant to a Confidentiality Agreement dated as of June 21, 1995
between Union Electric and the Company (the "Confidentiality Agreement"), the
parties thereto have agreed, among other things, that for a period of two years
from the date of the Confidentiality Agreement (the "Restricted Period"),
neither party to the Confidentiality Agreement will
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propose or enter into or agree to enter into, directly or indirectly, (i) any
form of business combination, acquisition or other transaction relating to the
other party or (ii) any form of restructuring, recapitalization or similar
transaction with respect to the other party. In addition, pursuant to the
Confidentiality Agreement, Union Electric and the Company have agreed that,
during the Restricted Period, neither party to the Confidentiality Agreement
will, singly or with any other person or directly or indirectly, (1) acquire, or
offer, propose or agree to acquire any voting securities of the other party, (2)
make or participate in any solicitation of proxies with respect to such voting
securities, (3) become a participant in any election contest with respect to the
other party, (4) seek to influence any person with respect to the voting or
disposition of any such voting securities, (5) demand a copy of the other
party's list of stockholders or its other books and records, (6) participate in
or encourage the formation of any partnership, syndicate or other group that
owns or seeks or offers to acquire beneficial ownership of any such voting
securities or that seeks to affect control of the other party or for the purpose
of circumventing any provision of the Confidentiality Agreement or (7) otherwise
act (including by providing financing for another person) to seek or to offer to
control or influence, in any manner, the management, Board of Directors or
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policies of the other party, provided, however, that the foregoing restrictions
will cease to be binding as to a party if the other party becomes the subject of
an Acquisition Proposal (as hereinafter defined) from an entity not a party to
the Confidentiality Agreement. In addition, subject to certain exceptions, until
such time as a party has told the other party in writing that discussions with
respect to the Transaction have terminated, neither party to the Confidentiality
Agreement nor its representatives will (a) initiate, encourage or solicit,
directly or indirectly, the making of any proposal or offer to acquire all or
any material part of the business and properties or capital stock of such party,
whether by merger, purchase of assets, tender offer or otherwise (an
"Acquisition Proposal"), or initiate, directly or indirectly, any contact with
any person in an effort to or with a view towards soliciting or initiating any
Acquisition Proposal, (b) participate in any discussions or negotiations
regarding, or furnish to any person any information with respect to, an
Acquisition Proposal, or (c) initiate, encourage or solicit, directly or
indirectly, the making of any proposal or offer to acquire all or any material
part of the business and properties or capital stock of any person or group
(other than the other party) engaged in a business that is competitive with the
business of either party, whether by merger, purchase of assets, tender offer or
otherwise. The Confidentiality Agreement is filed as an Exhibit to
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this Schedule 13D and is incorporated herein by reference. The description of
the Confidentiality Agreement set forth herein does not purport to be complete
and is qualified in its entirety by the provisions of the Confidentiality
Agreement.
Except as set forth in this Item 4, the Merger Agreement or the CIPSCO
Stock Option Agreement, neither Union Electric nor, to the best of Union
Electric's knowledge, any of the individuals named in Schedule I hereto, has any
plans or proposals which relate to or which would result in any of the actions
specified in clauses (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
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(a)-(b) By reason of its execution of the CIPSCO Stock Option
Agreement, pursuant to Rule 13d-3(d)(1)(i) promulgated under the Exchange Act,
Union Electric may be deemed to have sole voting and dispositive power with
respect to the CIPSCO Common Stock subject to the Option and, accordingly, may
be deemed to beneficially own 6,779,838 shares of CIPSCO Common Stock, or
approximately 19.9% of the CIPSCO Common Stock outstanding on August 11, 1995
assuming exercise of the Option. However, Union Electric expressly disclaims
any beneficial ownership of the 6,779,838 shares of CIPSCO Common Stock which
are obtainable by Union Electric upon exercise of the Option, because the Option
is exercisable only in the circumstances set forth in Item 4, none of which has
occurred as of the date
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hereof. Furthermore, even if events did occur which rendered the Option
exercisable, Union Electric believes it would be a practical impossibility to
obtain the regulatory approvals necessary to acquire shares of CIPSCO Common
Stock pursuant to the Option within 60 days.
Except as set forth above, neither Union Electric nor, to the best of
Union Electric's knowledge, any of the individuals named in Schedule I hereto,
owns any CIPSCO Common Stock.
(c) Except as set forth above, neither Union Electric nor, to the
best of Union Electric's knowledge, any of the individuals named in Schedule I
hereto, has effected any transaction in the CIPSCO Common Stock during the past
60 days.
(d) So long as Union Electric has not purchased the CIPSCO Common
Stock subject to the Option, Union Electric does not have the right to receive
or the power to direct the receipt of dividends from, or the proceeds from the
sale of, any of the CIPSCO Common Stock.
(e) Inapplicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the
Issuer.
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The Merger Agreement contains certain customary restrictions on the
conduct of the business of the Company pending the Merger, including certain
customary restrictions relating to the CIPSCO Common Stock. Except as provided
in the
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Merger Agreement, the CIPSCO Stock Option Agreement or the Confidentiality
Agreement, or as set forth herein, neither Union Electric nor, to the best of
Union Electric's knowledge, any of the individuals named in Schedule I hereto,
has any contracts, arrangement, understandings or relationships (legal or
otherwise), with any person with respect to any securities of the Company,
including, but not limited to, transfer or voting of any securities, finder's
fees, joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profits or losses, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
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Exhibit Description
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-1 Agreement and Plan of Merger, dated as of August 11, 1995, by and
among Union Electric Company, CIPSCO Incorporated, Arch Holding
Corp. and Arch Merger Inc. (Incorporated by reference to Exhibit
2(a) to Union Electric's Quarterly Report on Form 10-Q/A, Amendment
No. 1, for the quarter ended June 30, 1995 (Commission File No. 1-
2967).)
-2 Stock Option Agreement, dated as of August 11, 1995, by and between
CIPSCO Incorporated and Union Electric Company. (Incorporated by
reference to Exhibit 10(a) to Union Electric's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1995 (Commission File No.
1-2967).)
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-3 Stock Option Agreement, dated as of August 11, 1995, by and between
Union Electric Company and CIPSCO Incorporated. (Incorporated by
reference to Exhibit 3 to Union Electric's Quarterly Report on Form
10-Q for the quarter ended June 30, 1995 (Commission File No. 1-
2967).)
-4 Press Release, dated August 14, 1995, relating to the transactions
between Union Electric Company and CIPSCO Incorporated.
(Incorporated by reference to Exhibit 99(a) to Union Electric's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1995
(Commission File No. 1-2967).)
-5 Confidentiality Agreement, dated as of June 21, 1995, between Union
Electric Company and CIPSCO Incorporated.
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SIGNATURE
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After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement is
true, complete and correct.
Dated: August 17, 1995
UNION ELECTRIC COMPANY
By /s/ James C. Thompson
---------------------
James C. Thompson
Secretary
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SCHEDULE I
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DIRECTORS AND EXECUTIVE OFFICERS
OF UNION ELECTRIC
The name, business address or residence, present principal occupation
or employment, and the name, principal business and address of any corporation
or other organization in which such employment is conducted, of each of the
directors and executive officers of Union Electric Company, a Missouri
corporation ("Union Electric"), is set forth below. If no business address is
given, the director's or officer's address is Union Electric Company, 1901
Chouteau Avenue, St. Louis, Missouri 63103. Unless otherwise indicated, each
occupation set forth opposite an executive officer's name refers to employment
with Union Electric.
OFFICERS, MEMBERS OF THE BOARD OF DIRECTORS
AND ADVISORS TO THE BOARD OF DIRECTORS
-------------------------------------------
Present Principal Occupation
Name or Employment and Address
---- ------------------------------
Paul A. Agathen Vice President
Environmental and
Safety
M. Patricia Barrett Vice President
Corporate Communications
Jerre E. Birdsong Treasurer
Donald E. Brandt Senior Vice President
Finance and
Corporate Services
Charles A. Bremer Vice President
Information Services
Donald W. Capone Vice President
Engineering and
Construction
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Present Principal Occupation
Name or Employment and Address
---- ----------------------------------
William J. Carr Vice President
Customer Services -
Regional
Union Electric Company
101 Madison Street
Jefferson City, MO 65101
William E. Cornelius Director of Union Electric;
Retired Chairman and CEO
Charles J. Dougherty Adviser
Chemical Bank
11 West 51st Street
New York, NY 10019
Isaac B. Grainger Adviser
Chemical Bank
11 West 51st Street
New York, NY 10019
Thomas A. Hays Director of Union Electric;
Deputy Chairman,
The May Dept. Stores Co.
611 Olive Street
St. Louis, MO 63101
Thomas H. Jacobsen Director of Union Electric;
Chairman, President
and CEO, Mercantile
Bancorporation
Inc.
One Mercantile Center
P.O. Box 524
St. Louis, MO 63166
William E. Jaudes Vice President and
General Counsel
R. Alan Kelley Vice President
Energy Supply
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Present Principal Occupation
Name or Employment and Address
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Richard A. Liddy Director of Union Electric;
Chairman, President
and CEO,
General American Life
Insurance Company
P.O. Box 396
St. Louis, MO 63166
Herbert W. Loeh Vice President
Human Resources
John Peters MacCarthy Director of Union Electric;
Retired Chairman
and CEO,
Boatmen's Trust Co.
Paul L. Miller, Jr. Director of Union Electric;
President and CEO,
P.L. Miller & Assoc.
(Consultants)
The World Trade Center
121 South Meramec
Suite 1124
St. Louis, MO 63105
Michael J. Montana Vice President
Industrial Relations
Charles W. Mueller Director of Union Electric;
President, and Chief Executive
Officer
Joseph M. Pfeifer Controller
Robert O. Piening Senior Vice President
Power Operations
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Present Principal Occupation
Name or Employment and Address
---- ------------------------------
Robert H. Quenon Director of Union
Electric;
Retired Chairman,
Peabody Holding Co.
7800 Forsyth Blvd., 6th Fl.
St. Louis, MO 63105
Gary L. Rainwater Vice President
Corporate Planning
Garry L. Randolph Vice President
Nuclear Operations
Harvey Saligman Director of Union
Electric;
Retired Chairman,
INTERCO
#10 S. Brentwood
Suite 408
St. Louis, MO 63105
William A. Sanford Vice President
Supply Service
Donald F. Schnell Senior Vice President
Nuclear
Charles J. Schukai Senior Vice President
Customer Services
Robert J. Schukai Vice President
Power Plants
William C. Shores Vice President
Customer Services -
Metropolitan
James C. Thompson Secretary
-27-
<PAGE>
Present Principal Occupation
Name or Employment and Address
---- ---------------------------
Janet McAfee Weakley Director of Union Electric;
President,
Janet McAfee, Inc.
(Real Estate)
9889 Clayton Road
St. Louis, MO 63124
Ronald C. Zdellar Vice President
Customer Services -
Division Support
-28-
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
------- -----------
-1 Agreement and Plan of Merger, dated as of August 11, 1995, by and
among Union Electric Company, CIPSCO Incorporated, Arch Holding
Corp. and Arch Merger Inc. (Incorporated by reference to Exhibit
2(a) to Union Electric's Quarterly Report on Form 10-Q/A, Amendment
No. 1 for the quarter ended June 30, 1995 (Commission File No.
1-2967).)
-2 Stock Option Agreement, dated as of August 11, 1995, by and between
CIPSCO Incorporated and Union Electric Company. (Incorporated by
reference to Exhibit 10(a) to Union Electric's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1995 (Commission File No.
1-2967).)
-3 Stock Option Agreement, dated as of August 11, 1995, by and between
Union Electric Company and CIPSCO Incorporated. (Incorporated by
reference to Exhibit 3 to Union Electric's Quarterly Report on Form
10-Q for the quarter ended June 30, 1995 (Commission File No.
1-2967).)
-4 Press Release, dated August 14, 1995, relating to the transaction
between Union Electric Company and CIPSCO Incorporated.
-29-
<PAGE>
(Incorporated by reference to Exhibit 99(a) to Union Electric's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1995
(Commission File No. 1-2967).)
-5 Confidentiality Agreement, dated as of June 21, 1995, between Union
Electric Company and CIPSCO Incorporated.
-30-
<PAGE>
EXHIBIT 5
CONFIDENTIALITY AGREEMENT
-------------------------
THIS CONFIDENTIALITY AGREEMENT, dated as of June 21, 1995 (this
"Agreement") , is made by and between Union Electric Company, a Missouri
corporation ("Union Electric", which term shall, for purposes of this Agreement,
include its subsidiaries) and CIPSCO Incorporated, an Illinois corporation
("CIPSCO", which term shall, for purposes of this Agreement, include its
subsidiaries).
WHEREAS, each of Union Electric and CIPSCO (each a "Company" or a
"party", and collectively the "Companies" or the "parties") is prepared to
furnish the other party with certain information that is confidential,
proprietary or otherwise not publicly available to assist in an evaluation (the
"Evaluation") in connection with a possible business combination transaction
involving Union Electric and CIPSCO (a "Transaction").
NOW, THEREFORE, as a condition to, and in consideration of, Union
Electric and CIPSCO furnishing to each other Information (as defined herein),
Union Electric and CIPSCO agree as follows:
1. Nondisclosure of Information. Subject to paragraph 2 hereof, each
----------------------------
Company that receives or possesses Information provided by or on behalf of, or
relating to, the other Company will (a) keep the Information confidential, (b)
not use the Information in any manner detrimental to the other Company, and (c)
not use the Information other than in connection with the Evaluation.
Notwithstanding the preceding sentence, each Company may disclose Information to
those of its Representatives (as defined herein) as are assisting such Company
with the Evaluation. Each Company will (i) inform each of its Representatives
receiving Information of the confidential nature of the Information and of the
obligations imposed by this Agreement, (ii) direct its Representatives to treat
the Information confidentially and in accordance with the obligations imposed by
this Agreement and not to use the Information other than in connection with the
Evaluation, and (iii) be responsible for (A) any failure by such Company or any
of its Representatives (including, without limitation, Representatives who,
subsequent to the first date of disclosure of Information hereunder, cease to be
its Representatives) to treat the Information confidentially and in accordance
with this Agreement or (B) the use by such Company or by any of its
Representatives or former Representatives of the Information other than in
connection with the Evaluation. Subject to paragraph. 2 hereof, without the
prior written consent of the other party, neither
<PAGE>
Company nor its Representatives will disclose to any person (1) that Information
has been made available to such Company or its Representatives, (2) that
discussions relating to a Transaction are taking place or have terminated, or
(3) any of the terms, conditions or other facts with respect to such
discussions, the Evaluation or any Transaction.
2. Notice Preceding Compelled Disclosure. If either Company or any
-------------------------------------
of its Representatives is legally compelled, pursuant to a subpoena, civil
investigative demand or similar process, to disclose any Information provided by
or on behalf of the other Company or which relates to the other Company, the
Company legally compelled to disclose Information will promptly notify the other
party to permit that Company to seek a protective order or take other
appropriate action. The Company legally compelled to disclose Information will
also cooperate in all reasonable efforts by the other Company to obtain a
protective order or other reasonable assurance that confidential treatment will
be accorded the Information. If, in the absence of a protective order, either
Company or any of its Representatives is compelled as a matter of law (including
as a matter of federal or state securities law) or pursuant to the rules and
policies of any national securities exchange on which securities of the Company
are listed for trading to disclose Information, the Company compelled to
disclose Information may disclose only that part of the Information as is
required by law to be disclosed (in which case, prior to such disclosure, the
Company compelled to disclose Information will advise and consult with the other
Company and its counsel as to such disclosure and the nature and wording of such
disclosure), and, to the extent practical in the circumstances, the Company
compelled to disclose Information will use its best efforts to obtain
confidential treatment for any Information so disclosed.
3. Treatment of Information. Each Company will keep a record in
------------------------
reasonable detail of the Information furnished to it by or on behalf of the
other Company or its Representatives and of the location of such Information.
As soon as possible upon the written request of the other Company or upon the
termination by either Company of the Evaluation or the discussions relating to a
Transaction, each Company and its Representatives will destroy (or, at their
option, return to the other Company) all Information which has been provided in
tangible form by or on behalf of the other Company, together with all copies
thereof, as well as all Information that incorporates information provided by or
on behalf of the other Company. Such destruction (or return) will be confirmed
in writing to the other Company. Any Information not so destroyed (or returned)
will remain subject to this Agreement. Each Company acknowledges that it is
aware and that its Representatives have
-2-
<PAGE>
been or will be advised by it that the United States securities laws prohibit
any person who has material, non-public information from purchasing or, selling
securities based on such information or from communicating such information to
any other person.
4. Public Information. This Agreement will not apply to such
------------------
portions of the Information that (a) are or become generally available to the
public through no action by the Company receiving such portions or by that
Company's Representatives or (b) are or become available to the Company
receiving such portions or that Company's Representatives on a nonconfidential
basis from a source, other than the other Company or its Representatives, which
source the recipient Company believes, based upon reasonable inquiry, not to be
prohibited from disclosing such portions by a contractual, legal or fiduciary
obligation.
5. No Warranty of Accuracy. Each Company understands that the other
-----------------------
party will endeavor to include in the Information materials it believes to be
relevant for the Evaluation, but each Company acknowledges that neither the
other Company nor any of its Representatives makes any representation or
warranty as to the accuracy or completeness of any Information. Neither Company
nor any of its Representatives will have any liability to the other Company or
its Representatives resulting from the use of the Information, except for use of
the Information in breach of this Agreement.
6. Certain Actions. (a) During the course of the Evaluation,
---------------
neither Company nor its Representatives will initiate contact with any director,
officer or employee of the other Company (other than persons specifically
authorized by the other Company) regarding any matter relating to a Transaction.
If the Evaluation or the discussions relating to a Transaction are terminated
for any reason, each Company and its Representatives will permanently cease all
such contacts, whether or not previously authorized.
(b) As of the date hereof, except as previously disclosed in writing
to the other party, neither Company is the beneficial owner of any securities of
the other Company entitled to be voted generally in the election of directors or
any direct or indirect options or other rights to acquire any such securities
("Voting Securities"). For a period of two years from the date of this
Agreement (the "Restricted Period"), except as specifically requested in writing
by the other Company, neither Company nor any of its Representatives as a
principal, will propose or enter into or agree to enter
-3-
<PAGE>
into, singly or with any other person or directly or indirectly, (i) any form of
business combination, acquisition or other transaction relating to the other
Company, (ii) any form of restructuring, recapitalization or similar transaction
with respect to the other Company, or (iii) any demand, request or proposal to
amend, waive or terminate any provision of this paragraph of this Agreement.
Furthermore, during the Restricted Period, except as specifically requested in
writing by the other Company, neither Company will, singly or with any other
person or directly or indirectly, (1) acquire, or offer, propose or agree to
acquire, by tender offer, purchase or otherwise, any Voting Securities, (2)
make, or in any way participate in, any solicitation of proxies with respect to
Voting Securities (including by the execution of action by written consent), (3)
become a participant in any election contest with respect to the other Company,
(4) seek to influence any person with respect to the voting or disposition of
any Voting Securities, (5) demand a copy of the other Company's list of
stockholders or its other books and records, (6) participate in or encourage the
formation of any partnership, syndicate or other group that owns or seeks or
offers to acquire beneficial ownership of any Voting Securities or that seeks to
affect control of the other Company or for the purpose of circumventing any
provision of this Agreement or (7) otherwise act (including by providing
financing for another person) to seek or to offer to control or influence, in
any manner, the management, Board of Directors or policies of the other Company.
(c) During the Restricted Period, neither Company nor its
Representatives will directly or indirectly solicit for employment any of the
current directors, officers or managers of the other Company with whom initial
contact was made, or who were specifically identified by the other Company,
during the course of the Evaluation.
(d) The provisions of this paragraph 6 will survive for two years
from the date of this Agreement notwithstanding that some or all of the
Information has become publicly disclosed or that any portion of this Agreement
has become inoperative as to any portion of the Information.
(e) Nothing contained in this Agreement shall be deemed to restrict
in any respect activities of the parties in the ordinary course of business with
respect to Electric Energy, Inc. or any other business relationships between
Union Electric and CIPSCO predating this Agreement.
-4-
<PAGE>
(f) The provisions of this paragraph 6 shall cease to be binding as
to a party if the other party becomes the subject of an Acquisition Proposal (as
defined in paragraph 7) from an entity not a party.
7. Acquisition Proposals. Until such time as a party has told the
---------------------
other party in writing that discussions with respect to a Transaction have
terminated, neither Company nor its Representatives will (a) initiate, encourage
or solicit, directly or indirectly, the making of any proposal or offer to
acquire all or any material part of the business and properties or capital stock
of such Company, whether by merger, purchase of assets, tender offer or
otherwise (an "Acquisition Proposal"), or initiate, directly or indirectly, any
contact with any person in an effort to or with a view towards soliciting or
initiating any Acquisition Proposal, (b) participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, an Acquisition Proposal, or (c) initiate, encourage or solicit, directly or
indirectly, the making of any proposal or offer to acquire all or any material
part of the business and properties or capital stock of any person or group
(other than the other Company) engaged in a business that is competitive with
the business of either Company, whether by merger, purchase of assets, tender
offer or otherwise. Notwithstanding the foregoing, either Company may (i)
furnish Information to the other Company and its Representatives pursuant to
this Agreement, (ii) issue a joint announcement regarding the possibility of a
Transaction after obtaining the other Company's prior consent to the content and
timing of such announcement, (iii) issue any statement required by the federal
securities laws or by rule or policy of any national securities exchange on
which securities of such Company are listed for trading, and (iv) participate in
discussions and negotiations directly and through its Representatives with
persons, other than the other Company, who have sought the same if its Board of
Directors determines, based as to legal matters on the written advice of outside
legal counsel, that the failure to furnish such information or to negotiate with
such persons would be inconsistent with the proper exercise of applicable
fiduciary duties. If either Company or its Representatives receives an
Acquisition Proposal or if discussions relating to an Acquisition Proposal are
sought to be initiated or continued, such Company will promptly inform the other
Company as to the material terms thereof.
8. Certain obligations Only on Definitive Agreement. The parties
------------------------------------------------
agree that unless and until a Definitive Agreement regarding a Transaction has
been executed, neither party will be under any legal obligation of any kind with
respect to any
-5-
<PAGE>
Transaction by virtue of this Agreement or any other written or oral expression
with respect to any Transaction.
9. General Provisions. This Agreement will be deemed to be effective
------------------
as of the earlier to occur of (i) the date Information is first disclosed by or
on behalf of either Company in connection with the Evaluation or (ii) the date
first written above. No failure or delay in exercising any right hereunder will
operate as a waiver thereof, nor will any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right. This Agreement, any amendment to this Agreement, waiver of rights or any
notice or consent hereunder signed in the name of either Company will not be
operative for purposes of this Agreement unless it is in writing and is signed
by the Chairman, the President, a Vice President or the Treasurer of that
Company while such person was still in office. This Agreement may be executed
in multiple counterparts, each of which will be deemed an original for all
purposes and all of which will constitute a single instrument. This Agreement
will be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Each Company acknowledges that the other
party may be irreparably injured by any violation of the terms of this
Agreement; accordingly, the Company alleging a violation will be entitled to
seek specific performance and injunctive relief as remedies for any violation,
in addition to all other remedies available at law or equity. Each Company
consents to personal jurisdiction in any action brought in any federal or state
court within the states of Illinois or Missouri having subject matter
jurisdiction in the matter for purposes of any action arising out of this
Agreement. This Agreement will be governed by and construed in accordance with
the laws of the state of Illinois, without giving effect to the principles of
conflict of laws thereof.
10. Certain Definitions. As used in this Agreement, (a) the terms or
-------------------
phrases "beneficial owner," "election contest," "group," "participant,"
"person," "proxy," "security," and "solicitation" (and the plurals thereof) will
be ascribed a meaning no less broad than the broadest definition or meaning of
such terms under the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder, (b) all information furnished to either
Union Electric or CIPSCO as contemplated by this Agreement, whether in oral,
written or electronic form and whether furnished by the other party or the other
party's Representatives, together with all written or electronic documentation
prepared by Union Electric or CIPSCO or its Representatives based upon,
reflecting or incorporating, in whole or in part, such information or the
-6-
<PAGE>
Evaluation, as well as the fact that the Companies are considering a Transaction
and performing the Evaluation, is herein referred to as the "Information," (c)
any director, officer, employee, agent, lender, partner or representative,
including, without limitation, any accountant, consultant, attorney or financial
advisor engaged by either Company, is herein referred to as a "Representative,"
and (d) a definitive, written agreement providing for a Transaction that is
executed by or on behalf of Union Electric and CIPSCO and that states it is
intended to be binding is herein referred to as a "Definitive Agreement;"
provided, however, that a Definitive Agreement does not include a letter of
-------- -------
intent or any other preliminary agreement, whether or not executed, and it does
not include any actual or purported written or oral acceptance of any offer or
bid.
Accepted and agreed to as of the date first shown:
UNION ELECTRIC COMPANY
By: /s/ Donald E. Brant
--------------------
Name: Donald E. Brandt
Title: Senior Vice President
CIPSCO INCORPORATED
By: /s/ C.L. Greenwalt
-------------------
Name: C. L. Greenwalt
Title: President & Chief
Executive Officer
-7-
