<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
CENTRAL AND SOUTH WEST CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
__________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
__________________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
__________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
__________________________________________________________________________
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form of schedule and the date of its filing.
1) Amount previously paid: _________________________________________________
2) Form, Schedule or Registration Statement No. ____________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
________________
* Set forth the amount on which the filing fee is calculated
and state how it was determined.
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Central and South West Corporation
_________________________
NOTICE OF
ANNUAL MEETING
OF SHAREHOLDERS
and
PROXY STATEMENT
Annual Meeting April 21, 1994
_________________________
March 9, 1994
Central and South West Corporation
1616 Woodall Rodgers Freeway
P.O. Box 660164
Dallas, Texas 75266-0164
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Central and South West Corporation
1616 Woodall Rodgers Freeway
P.O. Box 660164
Dallas, Texas 75266-0164
March 9, 1994
Dear Fellow Shareholder:
You are cordially invited to attend the annual meeting of
shareholders of Central and South West Corporation on April 21,
1994, at The University of Arkansas, Giffels Auditorium, Old
Main, Fayetteville, Arkansas, at 10:00 a.m., Central Time.
At this important meeting, you will be asked to elect
directors and appoint independent public accountants. I urge
you to read this proxy statement carefully.
It is important that your shares are represented whether or
not you plan to attend the meeting. Please sign, date and
promptly return your proxy card in the enclosed postage-paid
envelope. Your cooperation will be appreciated.
The Board of Directors and employees of Central and South
West Corporation appreciate your continued interest in the
Corporation. I want to express our gratitude for your
confidence and continued support.
Sincerely,
/s/ E. R. BROOKS
E. R. Brooks
Chairman, President and
Chief Executive Officer
<PAGE> 4
Central and South West Corporation
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting (Meeting) of shareholders of CENTRAL AND
SOUTH WEST CORPORATION (Corporation) will be held on April 21,
1994, at 10:00 a.m., Central Time, at The University of
Arkansas, Giffels Auditorium, Old Main, Fayetteville, Arkansas,
for the purpose of considering and voting upon proposals to:
1. a) Elect four directors to Class I of the
Corporation's Board of Directors (Board) to serve
three-year terms;
b) Elect one director to Class III of the Board to
serve the remaining two years of the current Class
III term;
2. Approve the Board's selection of Arthur Andersen & Co.
as the Corporation's independent public accountants for
the calendar year 1994; and
3. Transact such other business as may properly come
before the Meeting or any adjournment(s) thereof. The
Board at this time knows of no such other business.
For further information with respect to the matters to be
acted upon at the Meeting, reference is made to the Proxy
Statement accompanying this Notice. The Meeting may be
adjourned from time to time without any notice other than the
announcement at the Meeting or any adjournment(s) thereof, and
any and all business for which notice is hereby given may be
transacted at any such adjourned Meeting.
Only holders of Common Stock of the Corporation of record
at the close of business on March 1, 1994 (Record Date), will be
entitled to notice of and to vote at the Meeting or any
adjournment(s) thereof. Beginning April 6, 1994, a list of
shareholders entitled to vote at the Meeting will be available
for examination during ordinary business hours by any
shareholder for any purpose germane to the Meeting at the
offices of Southwestern Electric Power Company, 300 North
College, Fayetteville, Arkansas 72701.
A copy of the Corporation's 1993 Annual Report to
Shareholders has been provided to each record shareholder of the
Corporation and does not form any part of the material for the
solicitation of proxies.
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All shareholders are requested to be represented at the
Meeting, either in person or by proxy. To ensure your
representation, whether or not you plan to attend the Meeting,
please promptly complete, date and sign the enclosed proxy card
and return it in the postage-paid envelope provided.
Shareholders of record as of the Record Date will be entitled to
vote in person at the Meeting whether or not they have completed
and returned proxy cards. Your proxy covers all shares of
Common Stock of which you are a registered holder as of the
Record Date including all shares held for you as of that date in
the PowerShare SM Plan, the Corporation's Dividend Reinvestment
and Stock Purchase Plan. If you are an employee participating
in the Corporation's Thrift Plus, you will receive separate
instructions from the Plan Trustee covering shares held for your
account in the plan. You will also receive separate
instructions from your broker or other nominee if your shares
are held in "street name" by your broker or another financial
institution as nominee.
By Order of the Board of Directors,
/s/ FREDERIC L. FRAWLEY
Frederic L. Frawley
Secretary
March 9, 1994
_______________________________________________________________
YOUR VOTE IS IMPORTANT!
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY CARD,
REGARDLESS OF THE SIZE OF YOUR HOLDINGS, AS SOON AS POSSIBLE.
<PAGE> 6
Central and South West Corporation
Proxy Statement
_________________________
GENERAL INFORMATION
Purpose of the Meeting and Solicitation
This Proxy Statement is furnished to shareholders of Central and South
West Corporation (CSW or Corporation) in connection with the solicitation of
proxies by and on behalf of the Board of Directors of the Corporation
(Board) for use at the Annual Meeting of Shareholders to be held on April 21,
1994 at 10:00 a.m., Central Time, at The University of Arkansas, Giffels
Auditorium, Old Main, Fayetteville, Arkansas, and at any adjournment thereof
(Meeting). The purposes of the Meeting are set forth in the attached Notice
of Annual Meeting.
The initial solicitation of proxies is being made pursuant to this
Proxy Statement, which is being mailed to shareholders on or about March 9,
1994. The cost of such solicitation will be borne by the Corporation,
including the costs of assembling and mailing this Proxy Statement and the
enclosed proxy. The Corporation has employed D.F. King & Co., Inc. to
assist in the solicitation of proxies. The Corporation has agreed to pay
D.F. King & Co., Inc. a fee for such services of $7,500 plus out-of-pocket
expenses. After March 9, 1994, officers, employees and directors of the
Corporation may solicit proxies without extra compensation. Such
solicitation may be made by mail, telephone, facsimile, telegraph or in
person.
To ensure representation at the Meeting, each holder of outstanding
shares of Common Stock entitled to be voted at the Meeting is requested to
complete, date and sign the enclosed proxy card and return it to the
Corporation in the postage-paid envelope provided. Such shareholders will
be entitled to vote in person at the Meeting whether or not they have
completed and returned proxy cards. Banking institutions, brokerage firms,
custodians, trustees and other nominees and fiduciaries who are record
holders of the Common Stock entitled to be voted at the Meeting are
requested to forward this Proxy Statement, a proxy card and all of the
accompanying materials to each of the beneficial owners of such shares, and
to seek authority to execute proxies with respect to such shares. Upon
request, the Corporation will reimburse such record holders for their
reasonable out-of-pocket forwarding expenses.
Voting of Proxies
The Corporation's only voting security is its Common Stock, par value
$3.50 per share, of which 188,408,496 shares were outstanding on January 31,
1994.
Only holders of Common Stock of the Corporation of record on its books
at the close of business on March 1, 1994 (Record Date), are entitled to
notice of and to vote at the Meeting. Each shareholder is entitled to one
vote for each share of Common Stock of the Corporation held of record on the
Record Date, on each matter submitted to a vote at the Meeting. Any
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shareholder may vote shares owned either in person or by duly authorized
proxy, designating not more than three persons as proxies to vote the shares
owned. Cumulative voting is not permitted with respect to any proposal to
be acted upon at the Meeting.
Each shareholder returning a proxy to the Corporation has the right to
revoke it, at any time before it is voted, by submitting a later-dated proxy
in proper form, by notifying the Secretary of the Corporation in writing of
such revocation, or by appearing at the Meeting, requesting a return of the
proxy and voting the shares in person.
If properly executed and received by the Corporation before the
Meeting, any proxy representing shares of Common Stock entitled to be voted
at the Meeting and specifying how it is to be voted will be voted
accordingly. Any such proxy, however, which fails to specify how it is to
be voted on a proposal for which a specification may be made will be voted
on such proposal in accordance with the recommendation of the Board.
Abstentions are counted in tabulations of the votes cast on proposals
presented to shareholders, but broker non-votes are not counted for purposes
of determining whether a proposal has been approved.
The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote at the Meeting,
excluding any shares owned by the Corporation, is necessary to constitute a
quorum. Abstentions and broker non-votes are counted for purposes of
determining the presence or absence of a quorum for the transaction of
business.
The Board currently is unaware of any proposal to be presented at the
Meeting other than the matters specified in the attached Notice of Annual
Meeting of Shareholders. Should any other proposal properly come before the
Meeting, the persons named in the enclosed proxy will vote on each such
proposal in accordance with their discretion. Anyone desiring to address
the shareholders at the Meeting, whether or not making a formal proposal,
must so indicate this intention to the Secretary prior to the Meeting and
will be required to comply with the Rules of Conduct established prior to
the Meeting.
Shareholder Proposals for 1995 Annual Meeting
Pursuant to the rules of the Securities and Exchange Commission (SEC),
in order to be considered for inclusion in the Proxy Statement and form of
proxy relating to the 1995 annual meeting of shareholders, a proposal by a
record holder of Common Stock of the Corporation must be received by the
Secretary of the Corporation at the Corporation's principal executive
offices in Dallas, Texas, on or before November 9, 1994.
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Proposal 1: ELECTION OF DIRECTORS
Nominees for Directors
At the Meeting, four directors will be elected to Class I of the Board
for three-year terms expiring at the 1997 annual meeting or until their
respective successors are duly elected and qualified. One director will be
elected to Class III of the Board to fill the remaining two years of the
Class III term expiring at the 1996 annual meeting or until his successor is
duly elected and qualified. Directors will be elected by a plurality of the
votes cast at the Meeting.
In accordance with the Corporation's Certificate of Incorporation, the
Board is divided into three classes as nearly equal in size as is
practicable with staggered terms of office so that one class of the
directors must be elected at each annual meeting. The Board currently
consists of thirteen directors. Drayton McLane, Jr. resigned from the Board
in July 1993 and the Board elected Lloyd D. Ward to fill a directorship in
November 1993. The number of directors will be twelve upon the retirement
of Thomas B. Walker, Jr., a director since 1990, prior to the commencement
of the Meeting.
The Board of Directors of the Corporation has nominated and unanimously
recommends that shareholders vote FOR the election of T. J. Barlow, Molly
Shi Boren, Arthur E. Rasmussen and Thomas V. Shockley, III as Class I
directors and Lloyd D. Ward as a Class III director.
Each nominee is presently a director of the Corporation and has served
continuously since the year indicated opposite his/her name in the following
table. Each of the nominees has consented to being named as a nominee and
to serve as a director of the Corporation if elected. If, because of events
not presently known or anticipated, any nominee is unable to serve or for
good cause will not serve, the proxies voted for the election of directors
may be voted (at the discretion of the holders of the proxies) for a
substitute nominee not named herein.
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The following information is given with respect to the nominees for
election as directors:
Year
First
Became
Nominee, Age, Principal Occupation, Director
Business Experience and Other Directorships (1) and Class (2)
_____________________________________________________________ _________
T. J. BARLOW . . . . . . . . . . . . . . . . . . . . . AGE 71 1969 I
Retired prior to 1989 as Chairman of
Anderson, Clayton & Co., food products,
Houston, Texas.
MOLLY SHI BOREN. . . . . . . . . . . . . . . . . . . . AGE 50 1991 I
Attorney-at-law Seminole, Oklahoma
since prior to 1989. Director and
member of the Audit Committee for
Liberty Bank and Trust of Tulsa,
Oklahoma. Director of Liberty Bancorp,
Oklahoma City and Tulsa, Oklahoma.
Director of Pet Incorporated.
ARTHUR E. RASMUSSEN. . . . . . . . . . . . . . . . . . AGE 71 1971 I
Retired prior to 1989 as Chairman
and Chief Executive Officer of
Household Finance Corporation,
diversified financial services,
Chicago, Illinois. Director of
Abbott Laboratories, Amoco Corporation,
Delaware Bancshares Inc., The National
Bank of Delaware County, Walton,
New York and Director and Chairman
of the Executive Committee of Household
International.
THOMAS V. SHOCKLEY, III. . . . . . . . . . . . . . . . AGE 49 1991 I
Executive Vice President of the
Corporation since September 1990.
Chief Executive Officer of Central
and South West Services, Inc.,
a subsidiary of the Corporation,
from October 1992 to December 1993.
Senior Vice President of the Corporation
from June 1990 to September 1990.
President and Chief Executive Officer
of Central Power and Light Company,
a subsidiary of the Corporation,
from 1987 to June 1990. Director
of each of the Corporation's non-
electric subsidiaries.
<PAGE> 10
Year
First
Became
Nominee, Age, Principal Occupation, Director
Business Experience and Other Directorships (1) and Class (2)
_____________________________________________________________ _________
LLOYD D. WARD. . . . . . . . . . . . . . . . . . . . . AGE 45 1993 III
Division President-Central of Frito-Lay,
Inc., Dallas, Texas since January
1993. Division President-West of
Frito-Lay, Inc., Pleasanton, California
from October 1991 to December 1992.
General Manager of Frito-Lay, Inc.,
Pleasanton, California from June
1991 to October 1991. Vice President-
Operations of Pepsi-Cola East, a unit
of PepsiCo, Inc., Somers, N.Y.,
from 1988 to 1991. Elected by the
Board to serve as a director of
the Corporation in November 1993.
The following information is given for continuing directors:
Year
First
Became
Continuing Director, Age, Principal Occupation, Director
Business Experience and Other Directorships (1) and Class (2)
_________________________________________________________ _________
GLENN BIGGS. . . . . . . . . . . . . . . . . . . . AGE 60 1987 II
Chairman and Chief Executive Officer
of Texas High-Speed Rail Corporation
since December 1991. President
of Biggs & Co., investments, San
Antonio, Texas from 1989 to December
1991. Chairman of the Board and
Chief Executive Officer of Gill
Companies, savings and real estate,
San Antonio, Texas, from 1987 to
1989. Director of Diamond Shamrock
R & M, Inc. (3)
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Year
First
Became
Continuing Director, Age, Principal Occupation, Director
Business Experience and Other Directorships (1) and Class (2)
_________________________________________________________ _________
E. R. BROOKS . . . . . . . . . . . . . . . . . . . AGE 56 1988 II
Chairman, President and Chief Executive
Officer of the Corporation since
February 1991. President of the
Corporation from September 1990
to February 1991. President and
Chief Operating Officer of the
Corporation from January 1990 to
September 1990. Executive Vice
President of the Corporation from
June 1987 to December 1989. Director
of each of the Corporation's sub-
sidiaries. Director of Hubbell
Electric, Inc. Director of Baylor
University Medical Center, Dallas,
Texas.
ROBERT W. LAWLESS . . . . . . . . . . . . . . . . . AGE 57 1991 II
President and Chief Executive Officer
of Texas Tech University and Texas
Tech University Health Sciences
Center in Lubbock, Texas since
June 1989. Professor of Industrial
Engineering, Information Systems
and Quantitative Sciences at Texas
Tech University. Executive Vice
President and Chief Operations
Officer of Southwest Airlines Company
from July 1985 to June 1989. Director
of Salomon Brothers Fund, Salomon
Brothers Capital Fund, and Salomon
Brothers Investors Fund.
JAMES L. POWELL . . . . . . . . . . . . . . . . . . AGE 64 1987 II
Ranching and investments since
prior to 1989, Ft. McKavett, Texas.
Director of Southwest Bancorp of
Sanderson, Texas, First National
Bank, Eldorado, Texas and Advisory
Director of First National Bank,
Mertzon, Texas.
<PAGE> 12
Year
First
Became
Continuing Director, Age, Principal Occupation, Director
Business Experience and Other Directorships (1) and Class (2)
_________________________________________________________ _________
JOE H. FOY. . . . . . . . . . . . . . . . . . . . . AGE 67 1974 III
Retired in June 1993 as a Partner
of the firm of Bracewell & Patterson,
Attorneys, Houston, Texas, where he
served as a partner since prior to
1989. Director of Enron Corporation. (4)
HARRY D. MATTISON . . . . . . . . . . . . . . . . . AGE 57 1991 III
Executive Vice President of the
Corporation since September 1990
and Chief Executive Officer of
Central and South West Services,
Inc. since December 1993. Chief
Operating Officer of the Corporation
from September 1990 to December
1993. Previously he held positions
with Southwestern Electric Power
Company, a subsidiary of the Corporation,
serving as President and Chief
Executive Officer from September
1988 to September 1990, as Executive
Vice President from February 1988
to September 1988 and as Vice President
of Administration from February
1987 to February 1988. Director
of each of the Corporation's wholly
owned subsidiaries.
J. C. TEMPLETON . . . . . . . . . . . . . . . . . . AGE 69 1983 III
Investments since 1991, Houston,
Texas. Retired in 1991 as President
and Chairman of the Board of Directors
of TGX Corporation, positions in
which he served since prior to
1989.
__________________________
(1) Drayton McLane, Jr. resigned from the Board effective July 31, 1993, and
Thomas B. Walker, Jr. will retire from the Board immediately prior to the
Meeting.
(2) Class II and Class III directors' terms expire at the 1995 and 1996
annual meetings of shareholders, respectively, or when their respective
successors are duly elected and qualified.
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(3) The Corporation has retained Glenn Biggs under a Memorandum of Agreement
dated October 1, 1993 to pursue special business development activities
in Mexico on behalf of the Corporation. This agreement, which provides
for a monthly fee of $10,000, lasts through December 31, 1994, and may be
extended by mutual agreement between Mr. Biggs and the Corporation.
(4) The Corporation has retained Bracewell & Patterson under a Legal Services
Agreement dated April 1, 1980, to perform special assignments as
required. This agreement is effective from month to month until canceled
by either party.
Security Ownership of Management
The following table shows securities beneficially owned as of December
31, 1993 by each director and nominee, the chief executive officer and the
four other most highly compensated executive officers and, as a group, all
directors and executive officers of the Corporation. Share amounts shown in
this table include options exercisable within 60 days after year-end,
restricted stock, shares of Common Stock credited to Thrift Plus accounts, and
all other shares of Common Stock beneficially owned by the listed persons.
Each person has sole voting and sole investment power with respect to all
shares listed in the table below unless otherwise indicated.
Common Stock
Percent of
Shares (1) Class (2)
T.J. Barlow............................. 15,854 -
Glenn Biggs............................. 12,854 -
Molly Shi Boren......................... 1,129 -
E.R. Brooks............................. 60,959 -
Joe H. Foy.............................. 8,288 -
Robert W. Lawless....................... 1,334 -
Harry D. Mattison....................... 24,675 -
Ferd. C. Meyer, Jr...................... 13,588 -
James L. Powell......................... 2,443 -
Arthur E. Rasmussen..................... 8,516 -
Glenn D. Rosilier....................... 28,260 -
Thomas V. Shockley, III................. 19,602 -
J.C. Templeton.......................... 2,054 -
Thomas B. Walker, Jr.................... 6,854 -
Lloyd D. Ward........................... 300 -
All of the above and other executive
officers as a group (CSW Directors
and Executives)....................... 297,557 -
______________________
(1) Shares for Messrs. Brooks, Mattison, Meyer, Rosilier and Shockley, and
CSW Directors and Executives include 7,172, 4,708, 4,414, 3,561, 4,959
and 45,112 shares of restricted stock, respectively. These individuals
currently have voting power, but not investment power, with respect to
these shares. The above shares also include 9,531, 6,176, 4,810, 4,810,
6,176, and 63,690 shares underlying immediately exercisable options held
by Messrs. Brooks, Mattison, Meyer, Rosilier and Shockley, and CSW
Directors and Executives, respectively.
(2) Percentages are all less than one percent and therefore are omitted.
<PAGE> 14
OTHER INFORMATION REGARDING THE BOARD OF DIRECTORS
General Information
Nominees for directorships are recommended by the Corporation's
Nominating Committee and nominated by the Board on the basis of their
qualifications, including training, experience, integrity and independence
of mind, to render service to the Corporation. The Corporation's By-Laws
generally provide that the Corporation shall not elect or propose for
election as a director any non-employee who will have attained the age of 70
(72 for persons who served as directors and were at least 60 years of age on
October 12, 1987) at the date of such election or proposed election.
Federal law restricts the extent to which the Corporation may have
interlocking directorates with other companies.
The number of directors constituting the entire Board may not be less
than nine nor more than fifteen, as may be fixed from time to time by
resolution adopted by a majority of the entire Board. No decrease in the
number of directors on the Board may shorten the term of any incumbent
director. The majority of the Board may adopt a resolution to increase the
number of directors to not more than fifteen and may elect a new director or
directors to fill any such newly created directorship. Similarly, vacancies
occurring on the Board for any reason may be filled by majority vote of the
remaining directors. Any such Board-elected director will hold office until
the Corporation's next annual meeting of shareholders and the election and
qualification of a successor.
Under the Corporation's Certificate of Incorporation, any director may be
removed from office by the shareholders of the Corporation only for cause
and only by the affirmative vote of the holders of at least 80 percent of
the voting power of the outstanding shares of Common Stock.
Meetings and Compensation
The Board held six regular meetings and six special meetings during 1993.
Directors who are not also officers and employees of the Corporation receive
annual directors' fees of $24,000 ($12,000 of which will be paid in cash and
$12,000 in restricted stock) for serving on the Board and a fee of $1,250
per day plus expenses for each meeting of the Board or committee attended.
The Board has standing Policy, Audit, Executive Compensation and Nominating
Committees. Chairmen of the Audit, Executive Compensation and Nominating
Committees receive annual fees of $6,000, $3,500 and $3,500, respectively,
to be paid in cash in addition to regular directors' and meeting fees.
Committee chairmen and committee members who are also officers and employees
of the Corporation receive no annual directors', chairman's or meeting fees.
The Corporation maintains a memorial gift program for all of its current
directors, directors who retired since 1992 and certain executive officers.
Retired directors eligible for the memorial gift program are: M.L. Borchelt,
Drayton McLane, Jr., James M. Moroney, Jr., and Samuel W. White, Jr. Under
this program, the Corporation will make donations in a director's or
officer's name to up to three charitable organizations of an aggregate of
$500,000, payable by the Corporation upon such person's death. The
<PAGE> 15
Corporation maintains corporate-owned life insurance policies to fund the
program. The annual premiums paid by the Corporation are based on pooled
risks and average $17,013 per participant.
Mr. Biggs also is compensated as a consultant to the Corporation. See
footnote 3 to the information given for continuing directors above.
All current directors attended more than 75 percent of the total number
of meetings held by the Board and each committee on which such directors
served in 1993, except for Mr. Walker. Although in 1993 Mr. Walker attended
more than 75 percent of the total number of meetings held by the Board, he
was unable to attend three of seven meetings of Board committees on which he
served.
Policy Committee
The Policy Committee, currently consisting of Messrs. Brooks (Chairman),
Barlow, Foy and Rasmussen, held four meetings in 1993. The Policy Committee
reviews and makes recommendations to the Board concerning major policy
issues, considers the composition, structure and functions of the Board and
its committees and reviews existing corporate policies and recommends
changes when appropriate. The Policy Committee has authority to act as and
on behalf of the Board when the full Board is not in session.
Audit Committee
The Audit Committee, currently consisting of Ms. Boren and Messrs.
Rasmussen (Chairman), Biggs, Lawless, Templeton, Walker and Ward, held three
meetings in 1993. The Audit Committee recommends to the Board the
independent public accountants to be selected; discusses with the
independent public accountants the scope and results of their audit and the
adequacy of the accounting, financial and operating controls of the
Corporation and its subsidiaries; discusses with management and independent
public accountants the accounting principles, policies and practices of the
Corporation and its subsidiaries and their reporting policies and practices;
reviews the scope and results of the Corporation's internal auditing
activities and may investigate the adequacy of and compliance with the
system of internal accounting controls of the Corporation and its
subsidiaries.
Executive Compensation Committee
The Executive Compensation Committee, currently consisting of Ms. Boren
and Messrs. Foy (Chairman), Lawless, Powell and Templeton, held four
meetings in 1993. The Executive Compensation Committee determines the
executive compensation philosophy of the Corporation, reviews benefit
programs and management succession programs, sets the salaries for the
executive officers of the Corporation and reviews and recommends salaries
for the chief executive officers of the Corporation's principal
subsidiaries.
<PAGE> 16
Nominating Committee
The Nominating Committee, currently consisting of Messrs. Barlow
(Chairman), Biggs, Powell, Walker and Ward, held four meetings in 1993. The
Nominating Committee reviews candidates for election to the Board and
recommends qualified candidates to fill existing vacancies or newly created
directorships. The Nominating Committee welcomes shareholder suggestions
for Board nominations. Such suggestions should be directed to Mr. Brooks,
Chairman, President and Chief Executive Officer, who will forward them to
the Nominating Committee.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 and Section 17(a) of
the Public Utility Holding Company Act of 1935 require the Corporation's
officers and directors, and persons who beneficially own more than ten
percent of a registered class of the Corporation's equity securities, to
file reports of ownership and changes in ownership with the SEC and the New
York Stock Exchange. Officers, directors and greater-than-ten-percent
shareholders are required by SEC regulation to furnish the Corporation with
copies of all Section 16(a) reports they file.
Based solely on the Corporation's review of the copies of such forms
received and written representations from certain reporting persons that
they were not required to file, the Corporation believes that during the
1993 calendar year all such filing requirements applicable to its officers,
directors and greater-than-ten-percent shareholders were complied with.
Compensation Committee Interlocks and Insider Participation
No person serving during 1993 as a member of the Executive Compensation
Committee of the Board served as an officer or employee of the Corporation
or any of its subsidiaries during or prior to 1993. As described above in
footnote 3 to the information given for continuing directors, Mr. Biggs, who
served on the Corporation's Executive Compensation Committee for a portion
of 1993, is a party to a Memorandum of Agreement with the Corporation. Such
Committee neither approved nor recommended the approval of the Memorandum of
Agreement with Mr. Biggs, which was unanimously approved by the Board with
Mr. Biggs being absent from the vote. Neither the Executive Compensation
Committee nor Mr. Biggs participated in any decisions about executive
compensation during the period the Memorandum of Agreement was under
consideration by the Board.
No person serving during 1993 as an executive officer of the Corporation
serves or has served on the compensation committee or as a director of
another company, one of whose executive officers serves as a member of the
Executive Compensation Committee or as a director of the Corporation.
<PAGE> 17
Proposal 2: APPROVAL OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Subject to the approval of the shareholders, the Board of the Corporation
has reappointed Arthur Andersen & Co., independent public accountants, as
auditors to examine the financial statements of the Corporation and its
subsidiaries for 1994. The affirmative vote of a majority of shares of
Common Stock represented at the Meeting is required to approve such
reappointment. The Corporation is advised that neither Arthur Andersen &
Co. nor any of its partners has any material direct or indirect relationship
with the Corporation or any of its subsidiaries, and that Arthur Andersen &
Co. qualifies as an independent public accountant as to the Corporation and
its subsidiaries under the applicable rules of the SEC.
A representative of Arthur Andersen & Co. will be present at the Meeting
with the opportunity to make a statement, if he or she desires to do so, and
will be available to respond to appropriate questions.
The Board of Directors of the Corporation unanimously recommends that
shareholders vote FOR the appointment of Arthur Andersen & Co.
Proposal 3: TRANSACTION OF OTHER BUSINESS
At the date hereof, the management of the Corporation knows of no other
business to come before the Meeting. If any other business is properly
presented at the Meeting, the proxies will be voted in respect thereof in
the discretion of the person or persons voting them.
EXECUTIVE COMPENSATION
Executive Compensation Committee Report
The Corporation's executive compensation program has as its foundation
the following objectives:
* Maintaining a compensation program designed to support our corporate
goal of providing superior value to our shareholders and customers,
* Providing comprehensive programs which serve to facilitate the
recruitment, retention and motivation of qualified executives, and
* Rewarding our executives for achieving financial, operating and
personal objectives that produce a corresponding and direct return to
our shareholders in both the long-term and the short-term.
The Executive Compensation Committee of the Board (Committee) has
designed the Corporation's compensation programs around a strong pay-for-
performance philosophy. The Committee strives to maintain competitive
levels of total compensation as compared to peers in the utility industry.
The peer group the Corporation uses for purposes of determining each
element of compensation establishes rigorous standards for executive
performance. The Corporation selects only large, high credit quality
utility companies, large regional competitors and large electric utility
holding companies to gauge executive performance.
<PAGE> 18
The Corporation's policy is to establish competitive pay at the average
or mean of the range of pay found at peer utilities for each component of
compensation, including base pay, annual and long-term incentives including
stock option grants. In addition, the Corporation maintains for each of its
officers a package of benefit and welfare plans, generally available to all
employees, including without limitation a health plan, a thrift plan and
pension plan. Should corporate or individual performance fluctuate from
objectives or in relation to the performance of peer executives, the level
of total compensation for the executive will increase or decrease
accordingly.
Base Pay. An executive's base pay ties individual performance to defined
standards of job performance, accomplishments and progress toward individual
goals and objectives. An annual review of both individual performance and
competitive pay practices, using the average or mean of the competitive
review, contribute to the determination of an executive's base pay.
Incentive Programs-General. The executive incentive programs seek to
strike an appropriate balance of short-term accomplishments with the
Corporation's need to effectively plan for and perform over the long-term.
Their performance measures evaluate the executives' performance against
management's own expectations, customer satisfaction goals and relative
achievement when compared to the average or mean of the Corporation's peer
group.
Incentive Programs-Annual Incentive Plan. The Annual Incentive Plan
(AIP) directly ties specific individual goals with corporate performance,
current earnings per share growth, and other performance measures such as
customer satisfaction and price per kilowatt hour. Each performance measure
is weighted equally and is multiplied together to determine the percent of
overall target attained. Together, the objective measurements determine
whether an executive qualifies for 50 percent of the total AIP award. The
remainder is determined by a discretionary rating of the executive's overall
performance. Target awards are established as a percentage of salary range
midpoint. The total amount of an award that can be earned under the AIP is
limited to a range of 0 to 150 percent of target. AIP awards are made in
the form of cash, restricted stock and/or stock options. Each performance
measure must obtain a minimum level of performance equal to 50 percent or
greater of target to be included in the calculation. If minimum performance
is not achieved for any group of performance measures, then no bonus awards
are earned.
As the Corporation did not achieve its target earnings per share growth,
there were no payments made under the AIP for 1993.
Incentive Programs-Long-Term Incentive Plan. The Central and South West
Corporation 1992 Long-Term Incentive Plan (LTIP) also incorporates a
performance component. The LTIP measures the Corporation's total
shareholder return over a three-year cycle against the total shareholder
return of our peer group over the same three-year period. Awards are made
in restricted stock or stock options. Actual receipt of awards made in
restricted stock is dependent on relative total shareholder return for the
Corporation over a three-year performance period against a peer group of
high-performing utilities. Performance in the top three quartiles of the
<PAGE> 19
comparator group results in a payout to participants. The LTIP began in
1992 and will make its first payout in 1995 if plan performance measures are
met.
The Corporation also utilizes stock options as a part of its LTIP. The
stock options, once vested, allow members of management to buy specified
numbers of shares of the Corporation's common stock at the exercise price,
which to date has been market price on the date of grant. Stock options are
granted at the discretion of the Committee. The last stock option grant was
made in 1992. The size of the grants is based on the competitive practice
of the Corporation's peers giving consideration to theirs and the
Corporation's relative amounts of other long-term incentive awards.
New Tax Considerations. Recently enacted Section 162(m) of the Internal
Revenue Code generally limits the Corporation's federal income tax deduction
for compensation paid to any one executive officer named in the
Corporation's proxy statement to one million dollars. The limit does not
apply to specified types of payments, including most significantly payments
that are not includible in the employee's gross income, payments made to or
from a tax-qualified plan, and compensation that meets the requirements for
performance-based compensation. Under the new tax law, the amount of an
incentive award must be based entirely on an objective formula, without any
subjective consideration of individual performance, to be considered
performance-based.
The Committee has carefully considered the impact of this new tax law on
the incentive plans. At this time, the Committee believes it is in the
Corporation's and shareholders' best interests to retain the subjective
determination of individual performance under the AIP. Consequently,
payments under the AIP, if any, to the named executive officers may not
qualify for a deductibility exemption. The Corporation believes that
amounts awarded under the LTIP are deductible under the Internal Revenue
Code. The Committee believes that it is appropriate to continue with the
existing design and ensure that the tax deduction is retained.
The Committee is composed entirely of independent, outside directors.
The Committee annually reviews the operation and competitiveness of all
aspects of the Corporation's compensation program and retains an independent
consultant to assist with this review. By carefully and completely
reviewing the compensation programs offered the Corporation's executives,
the Committee seeks to ensure that the proper programs are in place to
enable the Corporation to achieve its strategic and operating objectives.
Rationale for CEO Compensation
In 1993, the compensation of Mr. Brooks was determined as described
above for all of the Corporation's executives.
* Base pay adjustments were derived by reference to the average or mean
base pay paid to chief executive officers at other utilities within the
Corporation's peer group. In determining the appropriate level, the
committee considered overall corporate and individual performance over
the past year, emphasizing corporate performance measures. Mr. Brooks'
annual salary increased to $595,000 in November 1993.
<PAGE> 20
* Mr. Brook's AIP incentive target award size also was derived by
reference to prevailing competitive market conditions for similar
utility organizations. Mr. Brooks' target AIP award for 1993 was
established at 40 percent of his base salary range midpoint. For Mr.
Brooks to receive a bonus at target, among other things the
Corporation's earnings per share first had to meet an aggressive growth
goal. In 1993, the Corporation did not achieve its annual earnings per
share target and no payments were made to Mr. Brooks under the AIP.
* The amount of Mr. Brooks' LTIP target award in 1993 was derived by
reference to the competitive market average or mean. Mr. Brooks' 1993
LTIP target award is $344,932 to be paid in shares of restricted stock
in 1996 if specified performance measures are met.
EXECUTIVE COMPENSATION COMMITTEE
Joe H. Foy, Chairman
Molly Shi Boren
Robert W. Lawless
James L. Powell
J.C. Templeton
<PAGE>
<PAGE> 21
<TABLE>
Cash and Other Forms of Compensation
The following table sets forth the aggregate cash and other compensation for services rendered for the fiscal years
of 1993, 1992, and 1991 paid or awarded by the Corporation and its subsidiaries to the Corporation's Chief Executive
Officer and each of the four most highly compensated executive officers of the Corporation (Named Executive Officers).
<CAPTION>
Summary Compensation Table
Annual Compensation Long Term Compensation
------------------------------ -----------------------------------
Awards Payouts
------------------------ -------
Other
Annual Restricted Securities All Other
Name and Compen- Stock Underlying LTIP Compen-
Principal Salary Bonus sation Award(s) Options/ Payments sation
Position Year ($) ($)(1) ($) (2) ($)(1)(3) SARs (#) ($) ($)(2)(4)
- --------- ---- ------- ------- ------- ---------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
E.R. Brooks 1993 549,167 57,265 20,579 57,236 - - 28,333
Chairman, President 1992 490,000 89,076 13,981 89,063 28,596 - 27,498
and Chief Executive 1991 430,000 59,062 - 62,974 - - -
Officer
T.V. Shockley, III 1993 373,333 35,462 12,606 35,402 - - 24,796
Executive Vice 1991 332,500 54,900 11,022 54,858 18,529 - 24,065
President 1991 295,833 51,935 - 55,430 - - -
Harry D. Mattison 1993 363,333 38,773 9,538 38,750 - - 28,333
Executive Vice 1992 322,500 54,900 9,361 54,858 18,529 - 27,498
President 1991 285,833 47,406 - 50,554 - - -
Ferd. C. Meyer, Jr. 1993 307,167 30,688 12,346 30,632 - - 24,796
Senior Vice 1992 285,000 48,898 7,846 48,914 14,430 - 24,065
President and 1991 261,000 45,745 - 48,806 - - -
General Counsel
Glenn D. Rosilier 1993 294,450 32,117 11,872 32,084 - - 24,796
Senior Vice 1992 263,590 48,898 6,299 48,914 14,430 - 24,065
President and Chief 1991 231,333 25,343 - 27,048 - - -
Financial Officer
</TABLE>
<PAGE> 22
<TABLE>
<FN>
___________________
(1) Amounts in this column are paid or awarded in a calendar year for performance in a preceding
year.
(2) The 1991 amounts were omitted pursuant to the transitional provisions in the revised rules on
executive officer and director compensation disclosure adopted by the SEC.
(3) Grants of restricted stock are administered by the Executive Compensation Committee of the Board,
which has the authority to determine the individuals to whom and the terms upon which restricted
stock grants shall be made. The awards reflected in this column all have four-year vesting
periods with 20% of the stock vesting on the first, second and third anniversary dates of the
award and 40% vesting on the fourth such anniversary. Upon vesting, shares of Common Stock are
issued without restrictions. The individual receives dividends and may vote shares of restricted
stock, even before they are vested. The amount reported in the table represents the market value
of the shares at the date of grant. As of the end of 1993, the aggregate restricted stock
holdings of each of the Named Executive Officers were:
<CAPTION>
Restricted Market Value
Stock Held at
December 31, 1993 December 31, 1993
----------------- -----------------
<S> <C> <C>
E.R. Brooks 7,172 $216,953
T.V. Shockley, III 4,959 150,010
Harry D. Mattison 4,708 142,417
Ferd. C. Meyer, Jr. 4,414 133,524
Glenn D. Rosilier 3,561 107,720
(4) The 1993 amounts shown in this column for each of the Named Executive Officers include $708 in
personal liability insurance premiums and $17,013 of memorial gift insurance premiums, the latter
of which represents an average premium paid per participant for insurance that is based upon
pooled risks. See "OTHER INFORMATION REGARDING THE BOARD OF DIRECTORS-Meetings and Compensation"
for a description of the Corporation's memorial gift program. The 1993 amounts shown in this
column also include employer matching payments to the Corporation's Thrift Plus plan of $10,612
each for Messrs. Brooks and Mattison, and of $7,075 each for Messrs. Shockley, Meyer and
Rosilier.
</TABLE>
<PAGE>
<PAGE> 23
Option/SAR Grants
The Corporation made no grants of stock options or stock appreciation
rights (SARs) in 1993.
Option/SAR Exercises and Year-End Value Table
Shown below is information regarding option/SAR exercises during 1993
and unexercised options/SARs at December 31, 1993 for the Named Executive
Officers.
<TABLE>
Aggregated Option/SAR Exercises in 1993
and Fiscal Year-End Option/SAR Values
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
Value at Year-End at Year-End ($)
Shares Acquired Realized Exercisable/ Exercisable/
Name on Exercise (#) ($) Unexercisable Unexercisable (1)
<S> <C> <C> <C> <C>
E. R. Brooks ............. - - 9,531/19,065 5,957/11,916
T. V. Shockley, III ...... - - 6,176/12,353 3,860/ 7,721
Harry D. Mattison ........ - - 6,176/12,353 3,860/ 7,721
Ferd. C. Meyer, Jr. ...... - - 4,810/ 9,620 3,006/ 6,013
Glenn D. Rosilier ........ - - 4,810/ 9,620 3,006/ 6,013
<FN>
_______________
(1) Based on the New York Stock Exchange December 31, 1993 closing price of the
Corporation's Common Stock of $30.25/share and the exercise price of
$29.625/share.
Long-Term Incentive Plan Awards
The following table shows information concerning awards made to the
Named Executive Officers during 1993 under the Central and South West
Corporation 1992 Long-Term Incentive Plan (LTIP):
<CAPTION>
Long-Term Incentive Plan Awards in 1993
Performance
Number of or Other Estimated Future Payouts under
Shares, Units or Period Until Non-Stock Price Based Plans
Other Rights Maturation Threshold Target Maximum
Name (#) or Payout ($) ($) ($)
<S> <C> <C> <C> <C> <C>
E. R. Brooks ............. 1 2 years 0 344,932 517,398
T. V. Shockley, III ...... 1 2 years 0 204,563 306,844
Harry D. Mattison ........ 1 2 years 0 204,563 306,844
Ferd. C. Meyer, Jr. ...... 1 2 years 0 160,624 240,936
Glenn D. Rosilier ........ 1 2 years 0 160,624 240,936
</TABLE>
<PAGE> 24
Payouts of the awards are contingent upon the Corporation's achieving
a specified level of total shareholder return, relative to a peer group of
utility companies, for the three-year period ended December 1995. Such
return must also exceed the average six-month treasury bill rate for the
same period in order for any payout to be made. If the Named Executive
Officer's employment is terminated during the performance period for any
reason other than death, total and permanent disability or retirement, then
the award is generally canceled.
The LTIP contains a provision accelerating awards upon a change in
control of the Corporation. If a change in control of the Corporation
occurs, (a) all options and SARs become fully exercisable, (b) all
restrictions, terms and conditions applicable to all restricted stock are
deemed lapsed and satisfied and all performance units are deemed to have
been fully earned, as of the date of the change in control. Awards which
have been granted and outstanding for less than six months as of the date of
change in control are not then exercisable, vested or earned on an
accelerated basis. The LTIP also contains provisions designed to prevent
circumvention of the above acceleration provisions generally through coerced
termination of an employee prior to the change in control of the
Corporation.
<TABLE>
Retirement Plans
<CAPTION>
Pension Plan Table
Annual Benefits After
Average Compensation Specified Years of Credited Service
15 20 25 30 or more
<S> <C> <C> <C> <C>
$250,000 . . . . . . . . . . . . . . . $ 62,625 $ 83,333 $104,167 $125,000
350,000 . . . . . . . . . . . . . . . 87,675 116,667 145,833 175,000
450,000 . . . . . . . . . . . . . . . 112,725 150,000 187,500 225,000
550,000 . . . . . . . . . . . . . . . 137,775 183,333 229,167 275,000
650,000 . . . . . . . . . . . . . . . 162,825 216,667 270,833 325,000
750,000 . . . . . . . . . . . . . . . 187,875 250,000 312,500 375,000
</TABLE>
Executive officers are eligible to participate in the tax-qualified,
Central and South West System Pension Plan like other employees of the
Corporation. Certain executive officers, including the Named Executive
Officers, are also eligible to participate in the Special Executive
Retirement Plan (SERP), a non-qualified ERISA excess benefit plan. Such
pension benefits depend upon years of credited service, age at retirement
and the amount of covered compensation earned by a participant. The annual
normal retirement benefits payable under the pension and the SERP are based
on 1.67% of "Average Compensation" times the number of years of credited
service (reduced by (i) no more than 50% of a participant's age 62 or later
Social Security benefit and (ii) certain other offset benefits).
<PAGE> 25
"Average Compensation" is the covered compensation for the plans and
equals the average annual compensation (salary as reported in the Summary
Compensation Table) during the 36 consecutive months of highest pay during
the 120 months prior to retirement. The combined benefit levels in the
table above, which include both pension and SERP benefits, are based on
retirement at age 65, the years of credited service shown, continued
existence of the plans without substantial change and payment in the form of
a single life annuity.
Respective years of credited service and ages, as of December 31, 1993,
for the Named Executive Officers are as follows: Mr. Brooks, 30 and 56; Mr.
Shockley, 10 and 49; Mr. Mattison, 30 and 57; Mr. Meyer, 11 and 54; and Mr.
Rosilier, 18 and 46. In addition, Mr. Shockley and Mr. Meyer have
arrangements with the Corporation under which they will receive a total of
30 years of credited service under the SERP if they remain employed by the
Corporation through ages 60 and 65, respectively. In 1992, Mr. Meyer
completed five consecutive years of employment which entitled him to receive
five additional years of credited service under the SERP as included in his
years of credited service set forth above in this paragraph.
Performance Graph
Set forth below is a line graph comparing the cumulative total
shareholder return on the Corporation's Common Stock with the cumulative
total return of companies comprising the Standard & Poor's 500 Stock Index
(S&P 500) and the Standard & Poor's Electric Companies Index (S&P Electric
Cos.).
Comparison of Five Year Cumulative Total Return (1)
Among Central and South West Corporation (CSW), the S&P 500 Index
and the S&P Electric Cos. Index (2)
[The Performance Graph is filed herewith as Exhibit 1.]
___________________
(1) This illustration assumes $100 invested on December 31, 1988 in Central
and South West Corporation Common Stock, the S&P 500 Index and the S&P
Electric Companies Index. Each mark on the axis displaying the years
1988 through 1993 represents December 31 of that year. Total Return
includes reinvestment of all dividends. The historical shareholder
return shown above may not be indicative of future performance.
<PAGE> 26
(2) The peer group used for executive compensation purposes is not used for
the Corporation's performance graph above, which reflects the S&P
Electric Companies Index, a broader index. The Corporation believes
its shareholders, who as a group have a wide range of other investments
including utility investments, find a broader measure of performance in
the electric utility industry more useful. See "EXECUTIVE
COMPENSATION-Executive Compensation Committee Report" for information
about the peer group used for executive compensation purposes.
CENTRAL AND SOUTH WEST CORPORATION
/s/ E. R. BROOKS
E. R. Brooks
Chairman, President and
Chief Executive Officer
March 9, 1994
<PAGE> 27
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE CORPORATION
Central and South West Corporation PROXY: The undersigned hereby appoints
P. O. Box 660164 T. J. Barlow, E. R. Brooks and Joe H.
Dallas, Texas 75266-1064 Foy, and each of them, attorneys and
proxies, with full power of sub-
stitution, to vote all shares of stock
of CENTRAL AND SOUTH WEST CORPORATION
held of record in the name of the
undersigned at the close of business on
March 1, 1994, at the annual meeting of
shareholders of the Corporation to be
held on April 21, 1994, and at all
adjournments thereof (Meeting):
The Corporations's Board of Directors (Board) recommends a vote IN FAVOR of
items (1) and (2).
(1) ELECTION OF DIRECTORS
____ FOR all nominees listed below ____ WITHHELD AUTHORITY to vote
(except as marked to the for all nominees listed below
contrary below)
T.J. BARLOW, MOLLY SHI BOREN, ARTHUR E. RASMUSSEN, THOMAS V. SHOCKLEY III,
LLOYD D. WARD
(INSTRUCTIONS: To withhold authority to vote for any individual nominee
write that nominee's name on the space provided below.)
___________________________________________________________________
(2) Approval of the appointment of Arthur Andersen & Co. by the Board as
independent public accounts for 1994.
FOR ____ AGAINST ____ ABSTAIN ____
(CONTINUED, AND TO BE SIGNED, ON REVERSE SIDE)
- -----------------------------------------------------------------------------
(CONTINUED FROM OTHER SIDE)
(3) The transaction of such other business as may properly be presented
at the Meeting. The Corporation's Board at this time knows of no other
business.
This Proxy when properly executed shall be voted as directed herein by
the undersigned shareholder. IN THE ABSENCE OF SPECIFIC DIRECTIONS, IT SHALL
BE VOTED FOR PROPOSALS 1 through 2.
Dated _________________________, 1994
Please Sign Here
_____________________________________
_____________________________________
Sign exactly as name(s) printed at left.
State full title when signing in fiduciary
or representative capacity.
<PAGE> 1
INDEX OF EXHIBITS
Exhibit Transmission
Number Exhibits Method
- ------- -------- ------------
1 Performance Graph SE
