<PAGE>
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 (S)240.14a-11(c) or (S)240.14a-12
CENTRAL ILLINOIS LIGHT COMPANY
(Name of Registrant as Specified in its Charter)
CENTRAL ILLINOIS LIGHT COMPANY
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(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) or 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.
- -------
*Set forth the amount on which the filing is calculated and state how it
was determined.
[X] 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 or Schedule and the date of its filing.
(1) Amount previously paid: $125
(2) Form, Schedule or Registration Statement No.: Definitive Proxy
Statement, File Number 1-8946
(3) Filing Party: CILCORP 0000 762129
(4) Date Filed: 3/21/94
<PAGE>
[LOGO OF CENTRAL ILLINOIS LIGHT COMPANY]
Notice of Annual Meeting
Dear Shareholders:
The Annual Meeting of Shareholders of Central Illinois Light Company will be
held on Tuesday, April 26, 1994 at 1:30 PM, Central Time, at the principal
office of the Company, 300 Liberty Street, Peoria, Illinois, in order to elect a
Board of Directors and transact such other business as may properly come before
the meeting.
Shareholders of record at the close of business on March 11, 1994 are entitled
to vote at the meeting.
By Order of the Board of Directors,
John G. Sahn
Secretary
March 28, 1994
IMPORTANT
It is important that your shares be represented at the meeting. Please mark,
sign, date and return the enclosed proxy promptly in order that your shares will
be voted.
<PAGE>
Proxy Statement
General
This statement is furnished in connection with a solicitation of proxies
by the Board of Directors of Central Illinois Light Company (the "Company"), for
use at the Annual Meeting of Shareholders to be held on Tuesday, April 26, 1994
at 1:30 PM, Central Time, at the Company's executive offices, 300 Liberty
Street, Peoria, Illinois 61602, and any adjournment thereof. The shares
represented by your proxy will be voted if the proxy is duly executed and
returned prior to the meeting. You may revoke your proxy by a duly executed
later proxy, or at any time before it is exercised by written notice to the
Secretary of the Company, received prior to the time of the meeting, or orally
at the meeting.
The expense of the solicitation of proxies is being borne by the Company.
In addition to solicitation by mail, officers and regular employees of the
Company may solicit proxies either personally or by telephone. The Company will
reimburse banks, brokers or other similar agents or fiduciaries for forwarding
proxy material to their principals, the beneficial owners of the stock.
The annual report of the Company for the year ended December 31, 1993 has
been sent to all shareholders of record at the close of business on March 11,
1994, which is the record date for the determination of shareholders entitled to
vote at the meeting. This proxy statement and accompanying proxy are to be first
mailed to shareholders on March 28, 1994.
Voting Securities and Principal Holders
On March 11, 1994, the record date for the meeting, the Company had
outstanding 191,204 shares of preferred stock, $100 par value, 470,000 shares of
Class A preferred stock, no par value, and 13,563,871 shares of common stock, no
par value. Each share entitles the holder thereof to one vote upon any matter
coming before the meeting, except that in the election of directors, each
shareholder is entitled to cumulate votes and, therefore, may give one nominee
as many votes as shall equal the number of directors to be elected multiplied by
the number of shares held by such shareholder, or may distribute such votes
among any two or more nominees by so indicating on the proxy. Votes cast by
proxy or in person at the annual meeting will be tabulated by the election
inspectors appointed for the meeting and will determine whether or not a quorum
is present. The election inspectors will treat abstentions as shares that are
present and entitled to vote for purposes of determining the presence of a
quorum but as unvoted for purposes of determining the approval of any matter
submitted to the shareholders for a vote. If a broker indicates on the proxy
that it does not have discretionary authority as to certain shares to vote on a
particular matter, those shares will not be considered as present and entitled
to vote with respect to that matter.
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At January 1, 1994, T. S. Romanowski, a vice president of the Company,
was the beneficial owner of 5 shares of the Company's preferred stock, $100 par
value, representing less than .003% of the shares of that class outstanding. No
other officer or director nominee was the beneficial owner of any shares of the
Company's preferred or common stock.
The following information, regarding beneficial ownership on January 1,
1994 of the Company's equity securities, is furnished with respect to each
person or group of persons acting together who, as of such date, is shown on the
Company's stock records to be the registered owner of more than 5% of any class
of the Company's voting securities and no independent inquiry has been made to
determine whether any shareholder is the beneficial owner of shares not
registered in the name of such shareholder or whether any shareholder is a
member of a shareholder group.
<TABLE>
<CAPTION>
Class of Name and Address of Amount and Nature of Percent
Stock Beneficial Owner Beneficial Ownership of Class
-------- ------------------- -------------------- --------
<S> <C> <C> <C>
Common CILCORP Inc. 13,563,871 100
300 Hamilton Boulevard
Suite 300
Peoria, IL 61602
</TABLE>
Election as Directors
Ten directors are to be elected at the annual meeting to hold office for
the ensuing year or until their successors are elected and qualified. All
nominees are now serving as directors of the Company and have consented to
serve, if elected. To be elected a director, a nominee must be among the ten
nominees receiving the highest number of votes. The nominees, along with their
biographical summaries, are listed below.
The Board of Directors has no reason to believe that the persons named
will not be available, but in the event that a vacancy among the original
nominees is occasioned by death or any other reason prior to the meeting, the
proxy will be voted for a substitute nominee or nominees designated by the Board
of Directors.
Marcus Alexis
Board of Trustees Professor of Economics
and Professor of Management and Strategy
Northwestern University, Evanston, Illinois
Director of CILCO since 1988
Member of the Finance Committee
Dr. Alexis was born at New York, New York in 1932. He graduated from
Brooklyn College in 1953 with a degree in economics. Dr. Alexis received a
Master of Arts degree in economics from Michigan State University in 1954, and a
Ph.D degree in economics from
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the University of Minnesota in 1959. He initially joined Northwestern University
in 1970 and served as chairman of the Department of Economics from 1976-1979 and
1982-1985. During the period 1979 to 1981, he was a member, vice chairman and
acting chairman of the Interstate Commerce Commission. He joined the University
of Illinois at Chicago in 1985 as dean of the College of Business Administration
and professor of economics. He returned to Northwestern University in 1990. He
is former Chairman of the Federal Reserve Bank of Chicago and serves on the
boards of CILCORP, the Teachers Insurance and Annuity Association, the
Metropolitan Planning Council in Chicago, and is also a director of the
Economics Club of Chicago and the Lincoln Park Zoological Society.
John R. Brazil
President of Bradley University, Peoria, Illinois
Director of CILCO since 1993
Dr. Brazil was born at Los Angeles, California in 1946. He received a
bachelor's degree in history from Stanford University in 1968 and a master's
degree and Ph.D. in American studies from Yale University in 1972 and 1975,
respectively. In 1980, he was a Fulbright senior scholar in English and American
studies at the University of Sydney, Australia. Prior to joining Bradley
University as president in January 1992, he served as chancellor and professor
of English at the University of Massachusetts Dartmouth (formerly known as
Southeastern Massachusetts University) from 1984 through 1991. Dr. Brazil was
previously associated with San Jose' State University in California for eleven
years, last serving as professor of humanities and American studies and vice
president for academic affairs. He is a director of First of America
Bank-Illinois, N.A. and Methodist Medical Center (both of Peoria), CILCORP, and
chairs the Walter Byers Post-Graduate Scholarship Committee of the National
Collegiate Athletic Association.
Willard Bunn III
Chairman and Chief Executive Officer of Banc One Illinois Corporation,
and Chairman of Bank One, Springfield, Illinois
Director of CILCO since 1991
Member of the Finance Committee
Mr. Bunn was born at Springfield, Illinois in 1943. He joined Bank One,
formerly Marine Bank of Springfield, in 1978 as an executive vice president. He
was elected president in 1980 and chairman and chief executive officer in 1989.
He was named to his present position in 1992. He was formerly associated with
Chemical Bank from 1968 to 1978 serving in various capacities including vice
president and group head of domestic depository institutions. Mr. Bunn graduated
from Princeton University in 1966 with a degree in history. He received his
master's degree in business administration from The Darden School at the
University of Virginia in 1968. Mr. Bunn is a trustee of Illinois Wesleyan
University, Bloomington, Illinois and serves on the boards of various local and
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<PAGE>
state business and civic organizations. He is a nominee for election to the
Board of Directors of CILCORP at that Company's 1994 annual meeting.
David E. Connor
President of David E. Connor and Associates, Peoria, Illinois
(financial advisor to businesses and banks)
Director of CILCO since 1968
Mr. Connor was born at Omaha, Nebraska in 1925. He graduated from Yale
University in 1947. Prior to his retirement in 1985, he had served as president
and as a director of Midwest Financial Group, Inc. (a multi-bank holding
company) since its inception in 1981, and chairman of its largest subsidiary,
Commercial National Bank of Peoria. Mr. Connor had been associated with the bank
since 1952, and advanced through various areas of responsibilities to vice
president in 1956. He was elected a director in 1959, senior vice president in
1964, president in 1967 and chairman in 1985. Mr. Connor formed David E. Connor
and Associates in 1985. Other directorships include CILCORP, CILCORP Investment
Management Inc., Keystone Consolidated Industries, Inc., Agricultural Research
and Development Corporation, Peoria Development Corporation and First Bankers
Trust Shares, Quincy, Illinois. He is a member of the board of trustees of
Bradley University and was formerly chairman of that board. He also serves on
the boards of various local and state business and civic organizations.
William M. Shay
Vice President of CILCO
Director of CILCO since 1991
Mr. Shay was born at Peoria, Illinois in 1952. He was initially employed
by CILCO in 1974 as an accountant and later as a budget analyst following
graduation from Bradley University with a degree in accounting. He left CILCO in
1975 to attend the University of Illinois College of Law. Upon graduation from
law school in 1978, he served for two years as a judicial clerk to a justice of
the Illinois Supreme Court. He was then associated with the Chicago law firm of
Isham, Lincoln & Beale until June 1982 when he rejoined the Company as attorney,
subsequently becoming general counsel. In February 1987, Mr. Shay joined the
Peoria office of Keck, Mahin & Cate, a law firm based in Chicago, as a partner.
He was named vice president and chief financial officer of CILCORP in 1988 and
to his present position effective January 1, 1993. He is also a certified public
accountant. Mr. Shay is a director of CILCORP Investment Management Inc., the
Illinois State Chamber of Commerce, Greater Peoria YMCA, the Peoria Area Chamber
of Commerce, Agricultural Research and Development Corporation, and the Bradley
University College of Business National Advisory Council. In addition, he is a
member of the community bank board of Norwest Bank of Peoria and the advisory
board of the Children's Hospital of Illinois at Saint Francis Medical Center.
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<PAGE>
R. Wayne Slone
Chairman, President and Chief Executive Officer of CILCO
Director of CILCO since 1988
Member of the Executive Committee
Mr. Slone was born in Fulton County, Illinois in 1935. He joined CILCO in
1958 and held various positions related to sales and operations until he was
appointed commercial activities manager in 1974. He was appointed general
manager, suburban division in 1976, manager of rates and regulatory affairs in
1981 and group manager in 1982. He was elected vice president (customer service
group) in 1983, senior vice president of the Company and CILCORP in 1986,
president and chief executive officer of CILCO in 1988 and chairman in 1991. Mr.
Slone is a director of the Edison Electric Institute, CILCORP, the Heartland
Partnership, and the Agricultural Research and Development Corporation. Mr.
Slone is a former chairman of the board of trustees of Proctor Hospital and
Proctor Health Care Inc. He is a trustee of Eureka College. He is a retired
Lieutenant Colonel of the Illinois Air National Guard, past president of the
Elmwood, Illinois Community Unit School Board and is active in civic
organizations.
Katherine E. Smith
Vice President, Consumer Affairs, U.S. Grocery Products Division,
The Quaker Oats Company, Chicago, Illinois
Director of CILCO since 1985
Member of the Finance Committee
Ms. Smith was born at Chicago, Illinois in 1940. She is a 1961 graduate
of Oregon State University with a degree in home economics. Ms. Smith has been
associated with The Quaker Oats Company since 1982 as vice president, consumer
affairs, U.S. Grocery Products Division. She was formerly with The Great
Atlantic & Pacific Tea Company, Inc. from 1976 to 1982 as vice president,
consumer affairs and marketing services and prior to that, she was associated
with The Pillsbury Company. She began her business career with Southern
California Gas Company, a division of Pacific Lighting Corporation, where she
advanced through various positions related to customer services. Ms. Smith is
active in a number of professional and civic associations including Grocery
Manufacturers of America, Society of Consumer Affairs Professionals in Business
and the American Home Economics Association. She is a director of CILCORP and a
trustee of Oregon State University Foundation.
5
<PAGE>
Richard N. Ullman
President of Federal Companies, Peoria, Illinois
(commercial warehousing, local and long distance moving)
Director of CILCO since 1988
Member of the Finance Committee
Mr. Ullman was born at Peoria, Illinois in 1934. He graduated from DePauw
University in 1956 with a liberal arts degree. He joined Federal Warehouse
Company in 1957. In 1973 he was named president of that company and of Federal
Companies. He is a director of First of America Bank-Illinois, N.A. (of Peoria)
and Keystone Consolidated Industries, Inc. and the Peoria Medical Research
Corporation. Mr. Ullman is a member of the Saint Francis Medical Center Advisory
Board, a member of the advisory board of Children's Hospital of Illinois at
Saint Francis Medical Center, and serves as a trustee of Bradley University. He
is active in a number of professional and civic associations. Mr. Ullman is a
director of CILCORP.
James F. Vergon
Vice President of CILCO
Director of CILCO since 1991
Mr. Vergon was born at Peoria, Illinois in 1948. He joined CILCO in 1971
and advanced through various positions in engineering. He was appointed gas
engineering manager in 1981, director-rates and regulatory affairs in 1982, and
elected vice president in 1986. He was vice president and chief financial
officer of CILCORP from January 1, 1993 through February 28, 1993. He was again
elected a vice president of the Company effective March 1, 1993. Mr. Vergon
graduated from Bradley University in 1971 with a degree in mechanical
engineering and is a registered professional engineer. He received a master's
degree in business administration from Bradley University in 1981. He is
chairman and president of CILCORP Investment Management Inc. and a member of the
board of directors of Bank One, Peoria, The Economic Development Council for the
Peoria Area, Greater Peoria YMCA, and the Heart of Illinois United Way. In
addition, he is a member of the Board of Trustees of Proctor Hospital and the
Bradley University Associate Board and the advisory boards of Forest Park
Foundation, The Institute of Public Utilities and the Bradley University College
of Engineering and Technology.
6
<PAGE>
Murray M. Yeomans
Chairman and Chief Executive Officer of Yeomans Distributing Company,
Peoria, Illinois
(wholesale appliances and central heating and cooling equipment)
Director of CILCO since 1987
Member of the Executive Committee
Mr. Yeomans was born at Philadelphia, Pennsylvania in 1935. He is a
graduate of Miami University (Ohio) with a degree in business administration. He
joined Yeomans Distributing Company in 1960 and was named president in 1972 and
to his present position in 1991. He is a director of CILCORP, First of America
Bank-Illinois, N.A. (of Peoria), Peoria Area Community Foundation and serves as
a trustee of Bradley University. In addition, he is a member of the Saint
Francis Medical Center Advisory Board and the board of directors of the Illinois
Neurological Institute. Mr. Yeomans is active in civic and charitable
activities.
Committees and Meetings of the Board of Directors
The Board of Directors has Executive and Finance Committees.
The Executive Committee has all the powers of the Board to the extent
permitted by law. The Committee also reviews and recommends to the Board of
Directors nominees to serve on the Board. The Committee considers nominees
brought to its attention by other members of the Board, by members of management
and by shareholders. Shareholders may submit recommendations to the Committee
with respect to nominees by writing to the Secretary of the Company. Directors
serving as members of the Committee are Messrs. Slone, Yeomans and H. Safford
Peacock. Mr. Peacock is not a nominee for re-election. During 1993, the
Committee held two meetings.
The Finance Committee is responsible for reviewing and making
recommendations to the Board of Directors with respect to (1) the compensation
of the executive officers of the Company and (2) the Company's financial
policies. Directors serving as members of the Committee are Messrs. Alexis,
Bunn, Ullman, Ms. Smith and James M. Unland. Mr. Unland is not a nominee for
re-election. During 1993, the Committee held nine meetings.
During 1993, the Board of Directors held a total of twelve meetings.
Proposals of Shareholders
Proposals of shareholders to be presented at the April 25, 1995 annual
meeting must be received not later than November 28, 1994 for inclusion in the
proxy statement and form of proxy relating to that meeting. Proposals should be
sent to the Secretary, Central Illinois Light Company, 300 Liberty Street,
Peoria, Illinois 61602.
7
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Independent Auditors
Upon the recommendation of its Audit Committee, the Board of Directors of
the Company's parent, CILCORP Inc., has appointed Arthur Andersen & Co.,
independent public accountants, to audit the accounts of the Company for 1994.
Arthur Andersen & Co. is not expected to be represented at the annual meeting.
Executive Compensation
The following table sets forth the compensation earned for the years
1993, 1992 and 1991 for the Chief Executive Officer and the four highest
compensated executive officers of the Company whose total annual compensation
exceeded $100,000:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Long-Term
Compensation Compensation
------------ ------------ All Other
Name and Principal Position Year Salary LTIP Payouts(1) Compensation(2)
- --------------------------- ---- ------ --------------- ---------------
<S> <C> <C> <C> <C>
R. W. Slone 1993 $205,500 $88,635 $28,611
Chairman, President and Chief 1992 195,250 60,976 22,371
Executive Officer 1991 183,350 61,849 22,262
W. M. Shay (3) 1993 150,437 34,864 17,953
Vice President 1992 143,250 30,851 25,821
1991 135,350 42,953 24,092
J. F. Vergon (4) 1993 134,564 57,114 11,635
Vice President 1992 121,205 40,796 9,310
1991 113,714 38,425 9,091
T. S. Romanowski 1993 121,705 55,162 10,894
Vice President 1992 115,914 39,922 8,886
1991 111,269 36,938 8,723
T. S. Kurtz 1993 118,120 53,012 8,022
Vice President 1992 111,434 38,249 15,946
1991 105,127 36,406 16,617
</TABLE>
- ---------
(1) Amounts paid pursuant to the Company's EVA-Based Incentive Compensation
Plan.
(2) The amounts shown in this column for 1993 represent (a) Company
contributions under the Employees' Savings Plan: Mr. Slone $4,497, Mr. Shay
$4,062, Mr. Vergon $4,037, Mr. Romanowski $3,651 and Mr. Kurtz $3,544, and
(b) earnings on deferred compensation: Mr. Slone $24,114, Mr. Shay $13,891,
Mr. Vergon $7,598, Mr. Romanowski $7,243 and Mr. Kurtz $4,478.
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(3) Elected vice president of the Company effective January 1, 1993. Previously
Mr. Shay was a vice president of CILCORP.
(4) Re-elected vice president of the Company effective March 1, 1993. Mr. Vergon
served as vice president and chief financial officer of CILCORP from January
1, 1993 through February 28, 1993.
Finance Committee Report on Executive Compensation
Background and Policies. The Finance Committee of the Board of Directors
(the "Committee") is comprised of five non-employee members of the Board. The
Committee considers and makes recommendations to the Board with respect to the
compensation of the executive officers (the president and vice presidents) of
the Company. The Committee's compensation policies with respect to the executive
officers are as follows:
1. Compensation levels should be established which are internally fair and
equitable, bearing in mind (a) past practices, patterns and
relationships, an (b) the relationship between officer level
compensation and the compensation provided for top level managers
throughout the Company.
2. Compensation should be comparable and reasonable in relation to similar
positions in other utility companies of like size, structure and
characteristics.
3. Compensation of the executive officers should be directly related to
the economic value created for shareholders.
4. A compensation program should be designed to attract and retain
superior management.
Executive Officer Compensation Program. The Company's current executive
officer compensation program is comprised of two major components: base salary
and incentive compensation. Base salary levels for the Company's executive
officers are set by the Committee relative to other utility companies of similar
size and characteristics. In addition, the Committee also considers the
individual officer's experience and performance. Salaries of the executive
officers are reviewed each year by the Committee and may be adjusted based on
the individual's contribution to the Company's performance and competitive pay
levels.
Incentive compensation is awarded in accordance with the Company's
EVA-Based Incentive Compensation Plan ("EVA Plan") and the CILCORP Shareholder
Return Incentive Compensation Plan ("Shareholder Return Plan") approved by
CILCORP shareholders on April 27, 1993. The purpose of the EVA Plan is to
provide an incentive to eligible officers to increase and maintain shareholder
value by rewarding the achievement of this objective. EVA is a measure of
profitability that is based on the difference between the return earned on the
capital invested in an enterprise and the cost of that capital. This difference
can be either positive or negative. The resulting award is added to or deducted
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from balances accumulated from prior years. Each year, one third of the net
balance accumulated is paid to the participant. That portion of the incentive
compensation which has been deferred is "at risk" so that a negative EVA in a
subsequent year may eliminate previously accumulated balances. The award payment
is based, in part, on a fixed percent of the improvement in EVA from the prior
year plus a fixed percent of the maintenance of EVA over the preceding three
years.
Participants in the Shareholder Return Plan may include employees of
CILCORP and its subsidiaries, including CILCO, who make or influence policy
decisions which impact the overall long term success of the holding company. The
purposes of the Shareholder Return Plan are to promote long-term growth in the
value of CILCORP common stock, to attract and retain executives of outstanding
ability, to encourage teamwork among the executives of CILCORP and its
subsidiaries, and to reward performance based on the successful achievement of
pre-established corporate financial goals. Shares may be granted to eligible key
employees of CILCORP or its subsidiaries. At CILCO, only the Chief Executive
Officer of the Company is currently participating in the Plan. He has been
granted a designated number of shares to be distributed based upon achievement
of pre-established financial objectives for the first performance period which
commenced on January 1, 1993 and ends on December 31, 1997. The financial
objectives are based upon CILCORP's total shareholder return.
In 1993, the vice presidents of the Company received salary increases
averaging 6.7% based upon 1992 performance. The Company's return on average
common equity for 1992 was 11.3%.
President's Compensation. In April 1993, Mr. Slone's base salary was
increased from $198,000 to $208,000, a 5% increase based on his performance
during 1992. In evaluating Mr. Slone's performance, the Committee considered the
following factors:
(1) The Company's performance substantially met the objectives that were
established in the Company's 1992 Business Plan.
(2) During 1992, several matters of particular significance were
accomplished which should enhance the Company's future performance.
These included:
-- additional refinancing of the Company's long-term debt, resulting in
significant interest savings
-- construction of a 30-mile natural gas pipeline which diversifies
supply sources and increases storage opportunities
-- significant reduction in personal injury accidents
-- purchase of additional electric generating capacity to offset the
need for construction of additional generating capacity
-- three-year labor agreements with the Company's collective bargaining
units
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The Committee noted that, due to mild weather conditions, electric and
natural gas revenues declined 4.6% in 1992. The Committee further recognized the
increase in capital expenditures and operating costs incurred by the Company in
the renewal of its cast iron gas distribution system in Springfield, Illinois.
Mr. Slone was paid an award of $88,635 in 1993 pursuant to the Company's
EVA-Based Incentive Compensation Plan, based on the Company's continued positive
performance during the twelve months ended September 30, 1993.
Following approval of the CILCORP Shareholder Return Incentive
Compensation Plan at the Annual Meeting of Shareholders on April 27, 1993, Mr.
Slone was granted 2,000 shares of CILCORP common stock for the performance
period beginning January 1, 1993. Actual distribution of the shares granted to
Mr. Slone will occur only in the event that pre-established financial objectives
based on total shareholder return are achieved during the performance period
which expires December 31, 1997.
Finance Committee
Richard N. Ullman, Chairman
Marcus Alexis
Willard Bunn III
Katherine E. Smith
James M. Unland
Certain Plans
Benefit Replacement Plan. The Board of Directors has established a
Benefit Replacement Plan (the "Plan"). The Plan provides for payments to Plan
participants from the Company's general funds to restore the retirement benefit
under the Company's Pension Plan when such benefit is restricted by (1) the
maximum defined benefit limitation of Section 415(b) of the Internal Revenue
Code of 1986, as amended (the "Code"), (2) the index compensation limitation of
Code Section 401(a)(17), and (3) participation in certain of the Company's
deferred compensation plans. The Plan generally covers all CILCO Pension Plan
participants affected by these restrictions and provides for payment at the
times and in the forms of the Pension Plan.
Pension Plan. Pension benefits are provided through the Company's non-
contributory Pension Plan for Management, Office and Technical Employees.
Directors who are not employees do not participate in this Plan. Pension
benefits are determined using a formula based on years of service and highest
average rate of monthly earnings for any sixty consecutive month period. The
normal retirement date specified in the Pension Plan is age 65. Retirement prior
to age 62 results in an appropriate reduction in pension benefits.
11
<PAGE>
The following table shows the aggregate annual benefits payable upon
retirement at normal retirement age under the Pension Plan and under the Benefit
Replacement Plan discussed above. The amounts shown are not subject to any
deduction for Social Security benefits or other offset amounts other than that
for an optional survivorship provision.
Pension Plan Table
<TABLE>
<CAPTION>
Years of Service
---------------------------------------------------------
Remuneration 15 years 20 years 25 years 30 years 35 years
------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$175,000 $37,406 $49,875 $ 62,344 $ 74,813 $ 87,281
200,000 42,750 57,000 71,250 85,500 99,750
225,000 48,094 64,125 80,156 96,188 112,219
250,000 53,438 71,250 89,063 106,875 124,688
275,000 58,781 78,375 97,969 117,563 137,156
300,000 64,125 85,500 106,875 128,250 149,625
</TABLE>
The annual and long-term compensation shown for the individuals listed in
the above Summary Compensation Table is substantially compensation as covered by
the Pension Plan and the Benefit Replacement Plan. At January 1, 1993, the
credited years of service under the Pension Plan for the officers named in the
above table are as follows: R. W. Slone--35 years, W. M. Shay--11 years,
J. F. Vergon--22 years, T. S. Romanowski--22 years, and T. S. Kurtz--18 years.
Compensation Protection Plan. The Company's Board of Directors has
established a Compensation Protection Plan providing severance benefits to
eligible employees, including all individuals named in the Summary Compensation
Table above, in the event of (i) a termination of employment resulting directly
or indirectly from a sale of substantially all or certain assets of the Company
or (ii) a termination of employment within two years after a change in control
occurring involuntarily for a reason other than unacceptable performance or
occurring voluntarily with good reason as defined in the plan. A change in
control includes the sale of all or part of the business of the Company to a
person not controlled by CILCORP, a merger or consolidation of CILCORP in which
CILCORP does not survive or in which its common stock is converted, the
acquisition of 30% of the beneficial ownership of CILCORP by a person together
with the failure of continuing directors to constitute a majority of its Board
of Directors, or a sale of all or substantially all of the assets of CILCORP.
Upon a covered termination, a participant is entitled to a continuation of base
salary and benefit plan coverage for two years (or a shorter period for
participants below the position of vice president with less than 30 years of
service) after such termination.
Directors' Compensation. No fees are paid to directors who are officers
of the Company. Non-employee members of the Board receive a single annual
retainer fee of $13,000 for serving on the Company's Board and on CILCORP's
Board. Non-employee members of the Board who are not members of the Board of the
Company's parent
12
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receive an annual retainer fee of $9,800 for serving on the Company's Board.
These fees are prorated for less than a year's service. Non-employee directors
also receive an attendance fee of $750 for attending meetings of the Board of
Directors of the Company or CILCORP and an attendance fee of $750 for each
meeting attended of committees of those Boards. A single Board or committee
attendance fee is payable to each director in the event the Boards of this
Company and CILCORP or committees of the Boards of the Company and CILCORP meet
on the same day. Directors are also reimbursed for their travel expenses for
each Board or committee meeting attended.
Other Matters. The Board has no knowledge of any business to be
presented for consideration at the Annual Meeting other than that discussed
above. Should any other business properly come before the meeting or any
adjournment thereof, it is intended that the shares represented by proxies will
be voted with respect thereto in accordance with the best judgment of the
persons named in such proxies.
By Order of the Board of Directors,
John G. Sahn
Secretary
March 28, 1994
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[LOGO OF CENTRAL ILLINOIS LIGHT COMPANY]
THIS PROXY IS SOLICITATED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints D.E. Connor, R.W. Slone, and J.G. Sahn,
and each of them, attorneys and proxies with power of substitution to each,
with authority to vote, all shares which the undersigned would be entitled
to vote if personally present, at the 1994 annual meeting of shareholders
of Central Illinois Light Company, or at any adjournment thereof, upon the
election of directors as set forth in the notice of meeting and proxy statement
dated March 28, 1994, and, in their discretion, upon any other matter which
may properly come before the meeting. The shares represented hereby will
be voted as directed on the reverse of this card.
IF NOT OTHERWISE DIRECTED, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF DIRECTORS
---
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE)
<PAGE>
PROXY. PLEASE DATE AND SIGN EXACTLY AS NAME APPEARS BELOW. EACH JOINT
OWNER SHOULD SIGN. ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR
OTHERS SIGNING IN A REPRESENTATIVE CAPACITY SHOULD GIVE THEIR
FULL TITLES.
DATE__________________, 1994
____________________________
SIGNATURE/S
____________________________
ELECTION OF DIRECTORS [___] WITHHOLD AUTHORITY
[___] FOR all nominees listed to vote for all nominees
below (except as marked listed below
to the contrary below)
M. Alexis, J.R. Brazil, W. Bunn III, D.E. Connor, W.M. Shay,
R.W. Slone, K.E. Smith, R.N. Ullman, J.F. Vergon, and M.M. Yeomans.
Instruction: To withhold authority to vote for any individual
nominee, write that nominee's name in the space provided below.
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NO POSTAGE REQUIRED IF RETURNED IN THE ENCLOSED
ENVELOPE AND MAILED IN THE UNITED STATES
