<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/X/ Preliminary proxy statement
/ / Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
- --------------------------------------------------------------------------------
(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 transactions applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
- --------------------------------------------------------------------------------
(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 or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
- -------------------------
1Set forth the amount on which the filing fee is calculated and state how it was
determined.
<PAGE> 2
[LOGO]
607 EAST ADAMS STREET, SPRINGFIELD, ILLINOIS 62739
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Central Illinois Public
Service Company (the "Company") will be held at the Springfield
Hilton, Seventh and Adams Streets, Springfield, Illinois, on April 27,
1994, at 10:00 AM, for the purpose of considering and voting with
respect to the following matters:
(1) the election of a Board of nine directors;
(2) to consider and vote upon the following proposed amendments to
the Restated and Amended Articles of Incorporation, as amended
(the "Articles"):
a. To amend various provisions to clarify the effect of a
variable dividend rate on series of preferred stock and
related matters; and
b. To add a provision specifying that a majority of
outstanding shares entitled to vote (rather than
two-thirds) is sufficient to approve future amendments to
the Articles; and
(3) the transaction of such other business as may properly come
before the meeting.
Reference is made to the attached Proxy Statement for further
information with respect to the foregoing.
Only common and preferred shareholders of the Company of record
on its books at the close of business on March 1, 1994, are entitled
to vote at the meeting. All such shareholders are urged to be present
in person, or represented by proxy, at the meeting.
A copy of the Company's Annual Report to Shareholders for the
year 1993, which is combined with its 1993 Annual Report on Form 10-K
filed with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934, has been mailed to each shareholder
of the Company of record on its books.
By order of the Board of
Directors,
[SIG]
R. W. Jackson,
Senior Vice President and
Secretary
March 16, 1994
All shareholders, even if they plan to attend the meeting in
person, are urged to vote, date and sign their proxies and return
them to the Company in the enclosed envelope as promptly as
possible. The Board of Directors encourages all shareholders to be
represented at the meeting, whether their shareholdings are small
or large.
<PAGE> 3
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
607 East Adams Street
Springfield, Illinois 62739
MARCH 16, 1994
PROXY STATEMENT RELATING TO
1994 ANNUAL MEETING OF SHAREHOLDERS
INTRODUCTION
GENERAL. The purposes of the meeting are set forth in the attached Notice.
The enclosed proxy relating to the meeting is solicited on behalf of the Board
of Directors of the Company and the cost of such solicitation will be borne by
the Company. Following the initial solicitation of proxies by mail beginning on
or about March 16, 1994, certain officers, directors and employees of the
Company may solicit proxies by correspondence, telephone, telegraph, telecopy,
other electronic means or in person, but without extra compensation. The Company
will pay to banks, brokers, nominees and other fiduciaries their reasonable
charges and expenses incurred in forwarding the proxy soliciting material to
their principals. In addition, Morrow & Co., Inc., New York, New York, has been
retained to assist the Company and its affiliate in the solicitation of proxies.
Such solicitation may be made by mail, telecommunication or in person. The
estimated aggregate cost of such services of Morrow & Co., Inc. is $13,500.
HOLDING COMPANY. The Company is the principal subsidiary of CIPSCO
Incorporated ("CIPSCO").
VOTING. The voting securities of the Company outstanding on the record date
stated below consisted of 800,000 shares of Cumulative Preferred Stock, par
value $100 per share, of various series and 25,452,373 shares of Common Stock,
without par value.
Only shareholders (both preferred and common) of the Company of record on
its books at the close of business on March 1, 1994, are entitled to notice of
and to vote at the meeting. At such meeting, each such shareholder is entitled
to one vote, for each share of stock of the Company (whether preferred or
common) held, on each matter submitted to a vote at the meeting, except that in
the election of directors, each such shareholder is entitled to vote
cumulatively and therefore may give one nominee for election 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. The proxies solicited herewith seek discretionary authority to
cast cumulative votes in the election of directors.
Any shareholder may vote his or her shares either in person or by duly
authorized proxy. The giving of a proxy by a shareholder will not affect the
right to vote shares if the shareholder attends the meeting and desires to vote
in person. Prior to the voting of a proxy, it may be revoked by the shareholder
by delivering written notice of revocation to the Secretary of the Company, by
executing a subsequent proxy or by voting in person at the meeting. All shares
represented by effective proxies on the enclosed form of proxy, received by the
Company, will be voted at the meeting (or any adjourned session thereof) in
accordance with the terms of such proxies.
<PAGE> 4
A majority of the outstanding shares entitled to vote on a matter,
represented in person or by proxy, constitutes a quorum for consideration of
such matter at the meeting. If a quorum is present, the nine persons receiving
the greatest number of votes will be elected as directors, assuming cumulative
voting. The amendments to the Articles referred to as the "Management Proposals"
require the approval of the holders of two-thirds of all outstanding shares, as
described below under "Management Proposals to Amend the Articles of
Incorporation--Vote Required for Approval." On any other matter, the affirmative
vote of the majority of the shares represented at the meeting and entitled to
vote on the matter will be sufficient to take action on such other matter
properly before the meeting (unless a higher vote is required by law).
Abstentions will be counted in determining the quorum in attendance for all
matters and will be included in the total number of shares represented and
voting on a matter.
Broker non-votes will not be considered as represented at the meeting on
those matters for which no instructions from the shareholder have been given to
the broker. Accordingly, for any matter which requires the vote of a percentage
of shares represented at the meeting, broker non-votes will have no affect on
the outcome. However, on any matter (such as the Management Proposals) requiring
a specified percentage of all outstanding shares, broker non-votes will not be
counted to determine the shares voting in favor of the proposition.
PROPOSALS OF SHAREHOLDERS. Under the rules of the Securities and Exchange
Commission, any shareholder proposal intended to be presented at the 1995 annual
meeting of shareholders of the Company must be received at the principal
executive office of the Company no later than November 16, 1994, in order to be
eligible to be considered for inclusion in the proxy materials relating to that
meeting.
VOTING SECURITIES BENEFICIALLY OWNED BY PRINCIPAL HOLDERS, DIRECTORS,
NOMINEES AND EXECUTIVE OFFICERS. CIPSCO owned beneficially at March 1, 1994,
25,452,373 shares of Common Stock of the Company representing 100% of the
outstanding Common stock of the Company. The directors, nominees and executive
officers of the Company and CIPSCO owned beneficially at February 1, 1994, an
aggregate of 48,318 shares of Common Stock of CIPSCO representing 0.14% of the
outstanding Common Stock of CIPSCO and one share of Preferred Stock of CIPS
representing less than 0.01% of the outstanding Preferred Stock.
ELECTION OF DIRECTORS
Nine directors are to be elected at the meeting. Barring unforeseen
contingencies, and in the absence of contrary directions, the proxies solicited
herewith will be voted for the election of William J. Alley, Clifford L.
Greenwalt, John L. Heath, Robert W. Jackson, Gordon R. Lohman, Hanne M.
Merriman, Donald G. Raymer, Thomas L. Shade and James W. Wogsland as directors
of the Company, to hold office until the next annual meeting of shareholders of
the Company or until their respective successors shall have been duly elected
and qualified. Each of the nominees is a director of the Company. Each of the
directors of the Company has served continuously as such since his or her
election in the respective years indicated below. The proxies may also be voted
for a substitute nominee or nominees in the event any one or more of the above
nominees shall be unable to serve for any reason or be withdrawn from
nomination, a contingency not now anticipated.
2
<PAGE> 5
Effective April 27, 1994, the number of directors constituting the Board
will be reduced to nine from 10. Each of the nominees is a director of the
Company and also a director of CIPSCO, and has served continuously as such since
CIPSCO's formation in 1990, except Mr. Shade who was elected in 1991, and Mr.
Wogsland who was elected in 1992. Under the policy adopted by the Board of
Directors with respect to the age of directors, Mr. Robert S. Eckley, who has
been a director of the Company since 1973, will not stand for reelection as
director at the meeting. His position will not be filled as a result in the
reduction in the size of the Board.
The following information is given with respect to the nominees for
election as directors:
<TABLE>
<S> <C>
WILLIAM J. ALLEY
Principal occupation: Chairman of the Board and Chief Executive Officer of
American Brands, Inc. (diversified manufacturing and
other businesses), Old Greenwich, Connecticut.
Age: 64
Served as a director of
the Company since: 1974
Shares beneficially owned
at February 1, 1994: 1,422 shares of CIPSCO Common Stock. In addition, Mr.
Alley's account in the directors' deferred compensation
plan described below holds the equivalent of 3,792
shares of CIPSCO Common Stock.
Other information: Mr. Alley is Chairman of the Audit Committee and a
member of the Compensation and Executive Committees of
the Board. He is a director of American Brands, Inc.,
Moorman Manufacturing Company and Rayonier, Inc.
CLIFFORD L. GREENWALT
Principal occupation: President and Chief Executive Officer of the Company.
Age: 61
Served as a director of
the Company since: 1986
Shares beneficially owned
at February 1, 1994: 9,918 shares of CIPSCO Common Stock
Other information: Mr. Greenwalt is a member of the Executive Committee of
the Board. He is a director of First of America Bank
Corporation, Kalamazoo, Michigan and a director of its
wholly owned subsidiary, First of America
Bank-Springfield, N.A. Mr. Greenwalt was senior Vice
President-Operations of the Company from 1980 to August
1989 when he became President. Mr. Greenwalt is also
President and Chief Executive Officer of CIPSCO.
</TABLE>
3
<PAGE> 6
<TABLE>
<S> <C>
JOHN L. HEATH
Principal occupation: Retired Chairman and President of the Heath Candy Com-
pany, Robinson, Illinois.
Age: 58
Served as a director of
the Company since: 1977
Shares beneficially owned
at February 1, 1994: 4,000 shares of CIPSCO Common Stock
Other information: Mr. Heath is a member of the Nominating and Audit
Committees of the Board. He served as Chairman of L.S.
Heath & Sons, Inc. from 1971 until 1988 and also as
President and Chief Executive Officer from 1971 until
1982. Mr. Heath is a director of the Biltmore Bank Corp.
and of its wholly owned subsidiary, The Biltmore
Investors Bank of Phoenix, Arizona. He is also a
director of Sun Street Food Corporation of Phoenix,
Arizona.
ROBERT W. JACKSON
Principal occupation: Senior Vice President--Finance and Secretary of the Com-
pany.
Age: 63
Served as a director of
the Company since: 1986
Shares beneficially owned
at February 1, 1994: 6,160 shares of CIPSCO Common Stock
Other information: Mr. Jackson is a director of Firstbank of Illinois Co.
and each of its wholly owned subsidiary banks, including
the First National Bank of Springfield. Mr. Jackson is
also Senior Vice President, Chief Financial Officer and
Secretary of CIPSCO, and President and Chief Executive
Officer of CIPSCO Investment Company.
</TABLE>
4
<PAGE> 7
<TABLE>
<S> <C>
GORDON R. LOHMAN
Principal occupation: President and Chief Executive Officer of AMSTED
Industries Incorporated (diversified manufacturer of
industrial products), Chicago, Illinois.
Age: 59
Served as a director of
the Company since: 1989
Shares beneficially owned
at February 1, 1994: 200 shares of CIPSCO Common Stock. In addition, Mr.
Lohman's account in the directors' deferred compensa-
tion plan described below holds the equivalent of 3,270
shares of CIPSCO Common Stock.
Other information: Mr. Lohman is Chairman of the Compensation Committee and
a member of the Audit Committee of the Board. He became
President of AMSTED Industries Incorporated in 1988 and
Chief Executive Officer in 1990. He was Executive Vice
President of that firm in 1988 and served as Vice
President from 1978 through 1987. He is a director of
American Brands, Inc.
HANNE M. MERRIMAN
Principal occupation: Principal in Hanne Merriman Associates (retail business
consultants), Washington, D.C.
Age: 52
Served as a director of
the Company since: 1990
Shares beneficially owned
at February 1, 1994: 1,401 shares of CIPSCO Common Stock. In addition, Mrs.
Merriman's account in the directors' deferred
compensation plan described below holds the equivalent
of 2,016 shares of CIPSCO Common Stock.
Other information: Mrs. Merriman is a member of the Audit and the
Nominating Committees of the Board. She was President of
Nan Duskin, Inc. from 1991 to 1992. Previously she had
been a retail business consultant from January 1990.
Mrs. Merriman also served as President and Chief
Executive Officer of Honeybee, Inc., a division of
Spiegel, Inc., and President of Garfinckels, a division
of Allied Stores Corporation. Mrs. Merriman is a
director of USAir Group, Inc., State Farm Mutual
Automobile Insurance Co., The Rouse Company, and
AnnTaylor Stores Corporation.
</TABLE>
5
<PAGE> 8
<TABLE>
<S> <C>
DONALD G. RAYMER
Principal occupation: Retired President and Chief Executive Officer of the
Company.
Age: 69
Served as a director of
the Company since: 1972
Shares beneficially owned
at February 1, 1994: 8,034 shares of CIPSCO Common Stock. In addition, Mr.
Raymer's account in the directors' deferred compensa-
tion plan described below holds the equivalent of 3,019
shares of CIPSCO Common Stock.
Other information: Mr. Raymer is a member of the Executive Committee of the
Board. He is a director of Bank One Springfield. Mr.
Raymer was President and Chief Executive Officer of the
Company from August 1980 to August 1989.
THOMAS L. SHADE
Principal occupation: Retired Chairman of the Board and Chief Executive
Officer of Moorman Manufacturing Company (livestock feed
products), Quincy, Illinois.
Age: 63
Served as a director of
the Company since: 1991
Shares beneficially owned
at February 1, 1994: 2,333 shares of CIPSCO Common Stock. In addition, Mr.
Shade's account in the directors' deferred compensation
plan described below holds the equivalent of 1,374
shares of CIPSCO Common Stock.
Other information: Mr. Shade is a member of the Audit and Compensation
Committees of the Board. Mr. Shade served as Chairman of
the Board and Chief Executive Officer of Moorman
Manufacturing Company during 1992 and 1993. He was
President and Chief Executive Officer of that firm from
1984 to 1992. He also is a director of Moorman
Manufacturing Company, Quincy Soybean Company,
Mercantile Bancorp, Inc. and a director of its wholly
owned subsidiary, Mercantile Trust & Savings Bank, all
of Quincy, Illinois.
</TABLE>
6
<PAGE> 9
<TABLE>
<S> <C>
JAMES W. WOGSLAND
Principal occupation: Vice Chairman of Caterpillar, Inc. (heavy equipment and
engine manufacturer), Peoria, Illinois.
Age: 62
Served as a director of
the Company since: 1992
Shares beneficially owned
at February 1, 1994: 1,000 shares of CIPSCO Common Stock. In addition, Mr.
Wogsland's account in the directors' deferred compen-
sation plan described below holds the equivalent of 653
shares of CIPSCO Common Stock.
Other information: Mr. Wogsland is a member of the Audit and Nominating
Committees of the Board. Mr. Wogsland has been Vice
Chairman of Caterpillar, Inc. since 1990. He was
Executive Vice President of that firm from 1987 until
1990. He is a director of Caterpillar, Inc; First of
America Bank Corporation, Kalamazoo, Michigan and a
director of its wholly owned subsidiary, First of
America Bank-Illinois, N.A., Peoria, Illinois. He is
also a director of Protection Mutual Insurance Company.
</TABLE>
7
<PAGE> 10
EXECUTIVE COMPENSATION
The following table contains information with respect to the compensation
paid by the Company for all services rendered during 1991 through 1993 to the
President and the four most highly compensated executive officers:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-------------------- ALL OTHER
NAME OF INDIVIDUAL CAPACITIES IN WHICH SERVED YEAR SALARY BONUS(1) COMPENSATION(2)
- ------------------- ------------------------------ ---- -------- -------- ---------------
<S> <C> <C> <C> <C> <C>
C. L. Greenwalt President and Chief Executive 1993 $339,093 $99,902 $ 5,852
Officer of the Company 1992 317,375 0 2,073
1991 301,834 -- 2,073
R. W. Jackson Senior Vice President-- 1993 224,545 44,699 2,864
Finance and Secretary of the 1992 213,426 10,278 1,713
Company 1991 199,109 -- 1,893
L. A. Dodd Senior Vice President-- 1993 194,271 36,009 3,524
Operations 1992 176,880 8,504 2,073
1991 161,684 -- 2,073
W. R. Morgan Vice President--Division 1993 142,713 21,235 2,700
Operations 1992 135,758 8,653 2,073
1991 129,592 -- 2,073
G. W. Moorman Vice President--Power Supply 1993 134,585 20,047 2,564
1992 124,713 8,421 2,073
1991 117,509 -- 2,073
</TABLE>
- ------------
(1) Amounts paid under the Company's Management Incentive Program which began in
1992.
(2) Premiums paid by the Company on behalf of the officers for group term life
insurance.
Substantially all employees of the Company and CIPSCO (including officers)
participate in the Company's Retirement Income Plan (the "Retirement Plan"),
including persons whose remuneration is reported in the foregoing table.
Employer contributions to the Retirement Plan are determined actuarially. For
purposes of the Retirement Plan, compensation of a participant is base pay,
exclusive of bonuses, overtime pay, and other special payments. Compensation for
the persons named in the Summary Compensation Table is substantially equivalent
to the compensation reported in the Table under "Salary." Retirement Plan
benefits depend upon years of service, age at retirement and final average pay.
In certain cases, pension benefits under the Retirement Plan (or compensation
used to measure such benefits) will be reduced to comply with maximum
limitations imposed by the Internal Revenue Code. The Company maintains an
unfunded Excess Benefit Plan to provide for the payment of the difference
between the monthly benefit that would have been paid to participants under the
Retirement Plan if such limitations were not in effect and the reduced amount
payable as a result of such limitations. The credited years of service under the
Retirement Plan and the Excess Benefit Plan for the above listed persons as of
December 31, 1993 are as follows: Greenwalt, 30 years; Jackson, 14 years; Dodd,
29 years; Morgan, 30 years; and Moorman, 24 years. Assuming retirement at age
65, it is estimated a participant would be eligible for a
8
<PAGE> 11
maximum annual benefit under the Retirement Plan, as supplemented by the
Excess Benefit Plan, as follows:
<TABLE>
<CAPTION>
ANNUAL BENEFIT AFTER SPECIFIED YEARS OF SERVICE(1)
--------------------------------------------------------
AVERAGE ANNUAL EARNINGS(2) 20 25 30 35 40
- -------------------------------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000.............................. $ 34,059 $ 42,574 $ 51,089 $ 59,603 $ 68,118
150,000.............................. 41,559 51,949 62,339 72,728 83,118
175,000.............................. 49,059 61,324 73,589 85,853 98,118
200,000.............................. 56,559 70,699 84,839 98,978 113,118
225,000.............................. 64,059 80,074 96,089 112,103 128,118
250,000.............................. 71,559 89,449 107,339 125,228 143,118
275,000.............................. 79,059 98,824 118,589 138,353 158,118
300,000.............................. 86,559 108,199 129,839 151,478 173,118
325,000.............................. 94,059 117,574 141,089 164,603 188,118
350,000.............................. 101,559 126,949 152,339 177,728 203,118
375,000.............................. 109,059 136,324 163,589 190,853 218,118
400,000.............................. 116,559 145,669 174,839 203,978 233,118
425,000.............................. 124,059 155,074 186,089 217,103 248,118
</TABLE>
- ------------
(1) Annual benefits are on a straight-line annuity basis. Amounts shown have
been reduced by the deduction for Social Security benefits and are not
subject to any other offset amounts.
(2) "Average Annual Earnings" means the average annual base compensation during
the four years of highest pay during the ten-year period immediately
preceding retirement.
The Company also maintains an unfunded Special Executive Retirement Plan
(the "Executive Plan") for each employee of the Company or CIPSCO who was hired
from outside the Company, CIPSCO or their affiliates as a senior officer and who
is a participant in and qualifies for benefits under the Retirement Plan. For
purposes of the Executive Plan, a senior officer includes the president, vice
president and such other officers of the Company or CIPSCO as shall be
designated from time to time by the Board of Directors of the Company or CIPSCO.
A participant in the Executive Plan who becomes disabled or retires in
accordance with the Executive Plan is eligible to receive benefits under the
Executive Plan in an amount equal to the difference between (i) the amounts
which would have been payable under the Retirement Plan, as supplemented by the
Excess Benefit Plan, if the participant had 35 years of credited service under
the Retirement Plan (reduced in accordance with the Executive Plan if the
participant terminates employment for any reason prior to age 65) and (ii) the
aggregate of the amounts which are paid or payable (a) under the Retirement Plan
as supplemented by the Excess Benefit Plan, based upon the number of actual
years of credited service under the Retirement Plan, (b) under certain other
pension plans as a result of the participant's prior employment and (c) under
any employment contract with the Company or CIPSCO. A qualifying spouse of any
participant who dies is eligible to receive a percentage of the benefit provided
under the Plan for the participant. At present, Mr. Jackson is a participant
under the Executive Plan. His estimated annual benefits under the Retirement
Plan, the Excess Benefit Plan and the Executive Plan are as set forth in the
table above.
The individuals named in the Summary Compensation Table and three other
executive officers of the Company or CIPSCO have each entered into an Employment
Agreement with CIPSCO, which provides that in the event of a "change in control"
of the Company or CIPSCO, the Company and/or
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<PAGE> 12
CIPSCO or another subsidiary of CIPSCO will continue to employ the executive for
a period of three years from the date of the change in control, which period
will be extended for one-year increments unless notice to the contrary is given
as provided in the Employment Agreement (the "Period of Employment"). In the
event of the executive's (i) involuntary termination of employment during the
Period of Employment except by reason of death, disability, attainment of age 65
or cause (as defined in the Employment Agreement) or (ii) resignation during the
Period of Employment for good reason (as defined in the Employment Agreement),
the executive will be entitled to payment of severance compensation in an amount
equal to the present value of the executive's base pay and incentive pay
(determined as provided in the Employment Agreement) that would have accrued if
the executive remained employed until the end of the Period of Employment. The
executive will also receive continued employee benefits until the end of the
Period of Employment, subject to offset for comparable benefits. The severance
compensation will be increased by an amount necessary to compensate the
executive for any excise tax payable as a result of the payment and any other
compensation paid by the Company or any of its affiliates being contingent on a
change in control under federal income tax law. A "change in control" occurs, in
general, if (i) as a result of a merger, consolidation or sale of assets, less
than a majority of the voting power of CIPSCO is held after such event by the
persons who were holders of the voting power of CIPSCO prior to such event or
less than a majority of the voting power of the Company is held after such event
by CIPSCO or by the holders of the voting power of CIPSCO prior to such event,
(ii) any person (or group) acquires beneficial ownership of 20 percent or more
of the voting power of the Company or CIPSCO or (iii) within any two-year period
a majority of the members of the Board of Directors of the Company or CIPSCO
ceases to be members (other than changes in members approved by at least
two-thirds of the continuing directors).
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
OVERVIEW. The Compensation Committee of the Board of Directors of the Company
(the "Committee") is charged with overall oversight and review of the
performance and compensation of the executive officers of the Company. The
Committee is responsible for assuring that executive compensation and benefit
plans are implemented and are consistent with the Company's shareholder
interests, corporate goals and compensation philosophy.
The Company's executive officer compensation program supports these goals
and objectives. It is designed to attract, retain, motivate and reward top
quality and experienced officers to achieve the Company's business objectives.
It links executive compensation with corporate performance by providing the
opportunity to earn superior compensation during periods of superior results,
but also limits compensation during periods with lesser results.
The executive officer compensation program consists of a base salary and an
annual incentive. The base salary is determined by a combination of the
individual's performance relative to specific job responsibilities and market
comparisons of salaries for similar jobs in the utility industry. Particular
emphasis is placed on salary data provided by the Edison Electric Institute
("EEI") survey of electric and combination electric and natural gas utilities.
This group of utilities is essentially the same group that makes up the utility
peer group whose performance is shown on the Performance Graph below. The
philosophy is to pay base salaries and provide for incentive compensation that
are comparable to the medians of such amounts for the subgroup of utilities
included in the EEI survey that are of comparable size to the Company (based on
revenues).
10
<PAGE> 13
Salaries for the officers listed in the Summary Compensation Table were
increased in 1993 to track competitive base salaries being paid by the utility
industry and to reflect performance, which is determined subjectively by the
Committee based on individual evaluations. Incentive compensation was earned
based on achievement of the objectives of the annual management incentive
program (described below).
THE MANAGEMENT INCENTIVE PLAN. The Management Incentive Plan ("MIP"), an annual
incentive program instituted in 1992, strongly supports the Company's primary
goal of achieving superior returns on shareholders' investments. The MIP is
intended to provide additional compensation to the executive officers, named in
the Summary Compensation Table above, along with five other officers and 22
other employees of the Company. It is the Committee's responsibility to
administer the MIP and in so doing (1) set the overall corporate financial
performance goal and unit or individual objectives, (2) determine the
participants to be included in the MIP, and (3) determine the amount of each
participant's incentive pay to be based on attainment of the overall corporate
goal and the amount to be based on achievement of his or her unit or individual
objectives.
The overall corporate goal is based on attainment of a targeted return on
CIPSCO Common Stock equity. The Committee has determined that return on equity
is the measure of corporate performance that most directly measures management's
performance. Individual unit objectives relate to customer service, revenue
growth, cost control and other strategic initiatives. The MIP provides for
threshold, target and maximum levels of awards based on performance against the
predetermined targets. Achievement of threshold performance earns approximately
one-half of the target award while maximum performance earns approximately 1.5
times the target award. As currently administered, total incentive pay varies,
depending on the participant's position within the organization, from a minimum
of 7% of base salary for some participants, assuming threshold corporate and
unit goals are achieved, to a maximum of 40% of base salary for the President
and Chief Executive Officer assuming maximum performance is achieved. A
participant may receive the portion of his or her incentive pay tied to unit or
individual objectives even though CIPSCO has not attained the overall corporate
goal, with the exception of the President and Chief Executive Officer, whose
incentive pay is tied solely to the overall corporate goal of return on equity.
For other executive officers, individual unit awards are weighted, according to
the participant's position, to produce awards from 20% to 35% of the total award
with corporate performance goals weighted to make up the remaining 80% to 65%.
However, for any incentive pay to be earned by any participant, overall earnings
of the Company, on a per share basis, must equal or exceed the annualized Common
Stock dividend rate then in effect. Accordingly, shareholders will realize an
appropriate return on their investment prior to the payment of any incentive
compensation.
The targeted corporate goal of return on common equity was exceeded in 1993
resulting in MIP participants, including the officers named in the Summary
Compensation Table, earning various amounts of incentive compensation, based on
the formulas previously described. In addition, the Committee determined that
incentive compensation was earned by participants in 1993 for achievement of
individual and unit goals, in accordance with the MIP provisions. The Committee,
in accordance with plan provisions, authorized an adjustment in 1993 to allow an
individual to earn one-half of his or her unit goal threshold level award if
such goal was not achieved due to extraordinary circumstances beyond the control
of the individual participant. None of the other predetermined requirements for
earning awards was modified. Incentive awards are payable in cash as soon as
feasible following the close of the year after determination by the Committee of
the level
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of attainment of the goals. Benefits earned in 1993 are reflected in the "Bonus"
column of the Summary Compensation Table above.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. The Committee is responsible for
reviewing the Chief Executive Officer's performance and adjusting his base
salary accordingly. In addition, the Committee adjusts base salary to reflect
changes in the prevailing competitive market levels for Chief Executive Officers
in other comparably-sized utilities, as described above. The Committee increased
Mr. Greenwalt's salary in 1993 from $317,375 to $339,093 in recognition of his
strong performance in completing the responsibilities of his position, his
tenure as Chief Executive Officer, and increased compensation levels in the
utility industry.
Incentive compensation for the Chief Executive Officer was determined in
accordance with the provisions and formulas of the MIP. Accordingly, Mr.
Greenwalt's incentive compensation is based solely on corporate performance as
measured by the overall corporate goal of return on equity. He earned $99,902
under the MIP in 1993 because the Company's return on common equity exceeded the
predetermined target goal as established in the MIP.
The members of the Committee are indicated below. No member of the
Compensation Committee is a current or former officer of the Company or CIPSCO.
G. R. Lohman, Chairman
W. J. Alley
T. L. Shade
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PERFORMANCE GRAPH
The following graph is a comparison of CIPSCO's Common Stock performance as
compared to the Standard & Poor's 500 index and an industry peer group as
reported by the Edison Electric Institute. It assumes $100 invested at December
31, 1988, and all dividends paid during the period reinvested in additional
CIPSCO common stock. The peer group (as more fully described on Exhibit A
hereto) is made up of 100 investor-owned electric and combination electric and
natural gas utilities. The returns have been weighted to reflect the different
market capitalization of each utility in the group. As described in the
Compensation Committee Report, incentive compensation is based on return on
CIPSCO common equity rather than total return, as shown on the graph, because
the Compensation Committee believes it is a more direct measure of management's
performance.
TOTAL RETURN SUMMARY
BASED ON INITIAL INVESTMENT OF $100
1989 1990 1991 1992 1993
---- ---- ---- ---- ----
(DOLLARS)
CIPSCO 111 115 159 185 200
S&P 500 132 128 166 179 197
EEI INDEX OF 100 UTILITIES 130 132 169 182 208
*Incorporates returns of CIPS prior to 10/1/90.
DIRECTOR'S COMPENSATION
No annual retainer or fees are paid to any director who is an officer of
the Company or CIPSCO or any other subsidiary of CIPSCO. During 1993, other
members of the Board of the Company received an annual retainer of $10,000 for
serving on the Board of the Company and a fee of $750 for each Company Board
meeting or Committee meeting attended. The Chairman of the Company Executive
Committee received an additional annual fee of $2,500 and the Chairman of the
Company Audit Committee and the Chairman of the Company Compensation Committee
each received an additional annual fee of $2,000. Directors were also reimbursed
for their reasonable
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travel and out-of-pocket expenses for each Company Board or Committee meeting
attended. CIPSCO pays no additional fees for attendance at Board meetings or for
service on committees.
During 1993, non-employee directors of CIPSCO received an annual retainer
for serving on the Board of CIPSCO of $13,000. The annual retainer paid to each
director by CIPSCO, however, is reduced by an amount equal to the aggregate
amount paid to such director by each subsidiary of CIPSCO as an annual retainer
for services as a director of such subsidiary. All directors are on the Board of
the Company and CIPSCO. Consequently, the aggregate annual retainer for service
on both Boards for 1993 was $13,000.
The Company and CIPSCO each maintain an unfunded deferred compensation plan
under which directors may elect to defer directors' retainers and fees paid by
that company. For each director who elects to participate in a plan, the amount
of his or her directors' retainers and fees is accrued in an unfunded account in
the name of the director. Such amount is adjusted in value by an amount
equivalent to the amount which would be available if the director's compensation
were invested in CIPSCO's Common Stock and dividends on such stock were
reinvested. The aggregate value of each participant's accounts in the plans at
February 1, 1994 (based on deferred director's fees paid by the Company and
CIPSCO) was equivalent to investments in CIPSCO Common Stock as follows: Mr.
Alley, 3,792 shares; Mr. Lohman, 3,270 shares; Mrs. Merriman, 2,016 shares; Mr.
Raymer, 3,019 shares; Mr. Shade, 1,374 shares; and Mr. Wogsland, 653 shares.
Amounts accrued in a director's account will be paid in cash upon his or her
retirement as a director either in a single payment or over a period not to
exceed 20 calendar quarters, with interest. Because officers of the Company or
CIPSCO receive no compensation for services as directors, any director who is an
officer is not eligible to participate in the plans.
CIPSCO has established a Director Retirement Plan for directors of CIPSCO
and its affiliates, including the Company, who are not or have never been
officers of CIPSCO or any affiliate, including the Company. Each director who
has completed five years of service on the Board of CIPSCO or any of its
affiliates is eligible for monthly retirement payments for a period of the
lesser of 10 years or the number of full years the director served on any of the
Boards. The annual retirement benefit for a director of CIPSCO is equal to the
annual retainer in effect for CIPSCO's directors (without reduction for
director's fees paid by affiliates of CIPSCO) at the time the director ceases to
serve as a director. The annual retirement benefit for a director who is not a
member of the Board of CIPSCO is equal to the annual retainer in effect at the
time the director ceases to serve as a director for each of the Boards of which
the director was a member but not to exceed the amount of retainer for the
CIPSCO directors. Such annual retirement payment is reduced a proportional
amount for retiring directors younger than age 72.
MEETINGS AND COMMITTEES OF THE BOARD
During 1993, the Board of Directors held six meetings. The Board of
Directors of the Company and the Board of Directors of CIPSCO have each
established an Executive Committee, an Audit Committee, a Nominating Committee
and a Compensation Committee. Committee members are appointed by a majority of
directors at the Board of Directors meeting following the annual meeting of
shareholders. Committee members are the same for the Company's committees and
CIPSCO's committees.
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<PAGE> 17
Mr. Eckley, Mr. Alley, Mr. Greenwalt and Mr. Raymer are the members of the
Executive Committee. The Company's Executive Committee held eight meetings and
the CIPSCO Executive Committee held one meeting in 1993. The Executive Committee
has and may exercise all the authority of the Board of Directors in the
management of the Company, except in respect of certain matters or action as
provided by Illinois law.
Mr. Alley, Mr. Heath, Mr. Lohman, Mrs. Merriman, Mr. Shade and Mr. Wogsland
are the members of the Audit Committee. The Company's Audit Committee and the
CIPSCO Audit Committee each held three meetings in 1993. The Audit Committee
engages an independent public accountant for the Company, subject to the
approval of the Board; discusses with the independent public accountant the
scope and results of its audit and the adequacy of the Company's accounting,
financial and operating controls; approves the performance of non-audit
professional services by the independent public accountant; and discusses with
management and the independent public accountant the Company's accounting
principles, policies and practices and its reporting policies and practices.
Mr. Eckley, Mr. Heath, Mrs. Merriman and Mr. Wogsland are the members of
the Nominating Committee. The Company's Nominating Committee and the CIPSCO
Nominating Committee each held one meeting in 1993. The Nominating Committee
seeks out and recommends to the Board qualified candidates for election to the
Board; reviews the performance of Board members and, based upon such review,
makes recommendations to the Board as to which Board members should stand for
re-election. In making recommendations of nominees for election to the Board,
the Nominating Committee will consider persons recommended by shareholders. Any
shareholder wishing to make such a recommendation should write to the President
of the Company who will forward all such recommendations to the Nominating
Committee.
Mr. Lohman, Mr. Alley, and Mr. Shade are the members of the Compensation
Committee. The Company's Compensation Committee held three meetings and the
CIPSCO Compensation Committee held one meeting in 1993. The Compensation
Committee establishes the compensation to be paid officers of the Company (other
than assistant officers); reviews directors' fees and fees paid to directors for
membership on the various committees of the Board; reports to the Board as to
appropriate levels of compensation for such officers, and recommends to the
Board directors' fees and fees for membership on such committees. No member of
the Compensation Committee is a current or former officer of the Company or
CIPSCO.
During 1993, each director attended 100 percent of the total of the
meetings of the Company's and CIPSCO's Board and of committees of each Company's
Board of which he or she was a member.
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<PAGE> 18
MANAGEMENT PROPOSALS TO AMEND THE
ARTICLES OF INCORPORATION
INTRODUCTION
The Board of Directors, by unanimous vote, has recommended that the
Company's shareholders approve amendments to the Articles, as permitted by the
Illinois Business Corporation Act (the "Act"), to (1) modify various provisions
to clarify the effect of a variable dividend rate on series of preferred stock
and related matters ("Variable Dividend Proposal") and (2) add a provision
specifying that a majority of outstanding shares entitled to vote (rather than
two-thirds) is sufficient to approve future amendments to the Articles (the
"Majority Vote Proposal"). Each of the foregoing management proposals
(individually a "Management Proposal" and collectively the "Management
Proposals") will be voted upon separately and either Management Proposal
approved by shareholders will be adopted by the Company even if the other
Management Proposal is not approved. The text of each section of Articles, as it
is proposed to be amended, is set out in full in Exhibit B to this Proxy
Statement.
VOTE REQUIRED FOR APPROVAL
The Majority Vote Proposal will be approved if the holders of two-thirds of
the outstanding common stock and preferred stock, voting together as a class,
vote in favor of the Majority Vote Proposal. The Variable Dividend Proposal will
be approved if the holders of (i) two-thirds of the outstanding common stock and
preferred stock, voting together as a class and (ii) two-thirds of the preferred
stock voting separately as a class, vote in favor of the Variable Dividend
Proposal. Proxies will be voted in accordance with the specifications marked
thereon and, if no specification is made, will be voted "FOR" adoption of each
Management Proposal. See the discussion above under "Introduction--Voting"
regarding the effect of broker non-votes and abstentions. YOUR BOARD OF
DIRECTORS RECOMMENDS A VOTE "FOR" EACH MANAGEMENT PROPOSAL.
CIPSCO owns 100% of the outstanding common stock of the Company and
approximately 96% of all outstanding common stock and preferred stock together.
The affirmative vote by CIPSCO of its common stock in favor of the the Majority
Vote Proposal is sufficient to constitute shareholder approval thereof and
sufficient to constitute the approval required as described in clause (i) in the
preceding paragraph with respect to the Variable Dividend Proposal. The Variable
Dividend Proposal must also receive the vote described in clause (ii) above.
CIPSCO intends to vote in favor of both Management Proposals.
VARIABLE DIVIDEND PROPOSAL
GENERAL. Under Article IV of the Articles, the Company may issue additional
series of Cumulative Preferred Stock, par value $100 per share and Cumulative
Preferred Stock, without par value (collectively, the "Cumulative Preferred
Stock"). Article IV expressly vests in the Board of Directors the authority to
fix and determine at the time of issuance certain terms of each new series of
Cumulative Preferred Stock.
The Variable Dividend Proposal is intended to increase the flexibility of
the Board of Directors under Article IV in issuing future series of Cumulative
Preferred Stock, as well as with respect to the outstanding Cumulative Preferred
Stock--Auction Series A (the "Auction Series").
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Article IV currently provides that dividends must be payable quarterly on
each outstanding series of Cumulative Preferred Stock. Dividends are currently
payable on March 31, June 30, September 30 and December 31. For those
shareholders who presently own shares of any series of Cumulative Preferred
Stock, the quarterly dividend payment date will not be affected by this proposed
change in the Articles. The proposed amendments clarify that different dividend
payment dates and dividend periods can be fixed for the Auction Series (subject
to the limitations contained in the resolution that established the Auction
Series) and any new series of Cumulative Preferred Stock that may be issued in
the future. If the proposed amendments are adopted, the Company would be able to
switch from paying dividends quarterly on the Auction Series to paying dividends
every 49 days or every 13 weeks (as contemplated by the resolution that
established the Auction Series) if the Company determined that such dividend
periods would result in lower dividend rates. Even if the Variable Dividend
Proposal is adopted, the Company must affirmatively elect to change the dividend
period on the Auction Series.
Under the Variable Dividend Proposal, future series of Cumulative Preferred
Stock and, at the election of the Company as described above the Auction Series,
may provide for dividend periods other than the typical quarterly period.
Article IV of the Articles currently precludes the Company from paying a
dividend on one series of Cumulative Preferred Stock unless dividends have been
paid on or set apart for all other series of Cumulative Preferred Stock. This
provision makes it impractical for variable dividend rate Cumulative Preferred
Stock to have dividend periods other than the normal quarterly dividend
periods. Accordingly, the Variable Dividend Proposal would amend paragraph (2)
of Section A of Article IV to allow declaration of dividends on any share of
Cumulative Preferred Stock without declaring dividends on all other shares if
certain conditions are met. As amended, such paragraph of the Articles would
permit such a dividend to be declared if all dividends for all past dividend
periods of all shares of Cumulative Preferred Stock have been paid in full or
provided for. In addition, the Articles would require proportionate dividends to
be declared for all shares of Cumulative Preferred Stock for which dividends
were payable on the same day as the proposed dividend. These provisions will
allow the Company to declare and pay dividends on the Auction Series and any
future series of Preferred Stock having other than quarterly dividend periods or
other than the typical quarterly dividend payment date on any date without also
declaring dividends on other series (if the two conditions described above are
met). The Board of Directors believes this provision substantially maintains the
parity among series of Cumulative Preferred Stock as to the payment of dividends
while giving the Company the flexibility to take full advantage of modern
financing techniques.
Paragraph (4) of Section A of Article IV sets forth the requirements for
redemption of the Cumulative Preferred Stock. In general, such provision
requires 30 day's written notice of redemption be mailed to the record holders
of Cumulative Preferred Stock to be redeemed. Preferred stock with variable
dividend rates and dividend periods often provide for shorter notice periods or
for other more flexible redemption procedures. To facilitate issuance in the
future of such stock, the Board of Directors will be given the ability to set
the time, form and manner of giving notice of redemption for any future series
of Cumulative Preferred Stock (whether or not it has variable, adjustable or
floating dividend rates). If such matters are not set by the Board in connection
with the issuance of such a series, the provisions of paragraph (4) currently in
the Articles will control. This provision will not change the notice of
redemption requirements for any outstanding series of Cumulative Preferred
Stock, including the Auction Series.
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Paragraph (5) of Section A of Article IV provides that the Company cannot,
without the approval of the holders of at least two-thirds of the outstanding
shares of any series of Cumulative Preferred Stock, issue any additional shares
of preferred stock (or any other class of stock ranking prior thereto or on a
parity therewith) unless the Company's gross income for a specified twelve-month
period is at least equal to one and one-half times the sum of (i) interest
requirements for one year on all funded indebtedness and notes payable in more
than 12 months and (ii) annual dividend requirements on all preferred stock then
outstanding, on any other outstanding class of stock ranking prior thereto or on
a parity therewith, and on the shares of Cumulative Preferred Stock to be
issued. The existing test is silent on how to compute the annual interest or
dividend requirement on a series of Cumulative Preferred Stock, such as the
Auction Series, or on outstanding indebtedness that has an adjustable, variable
or floating rate. To ensure compliance with this test at the time the Auction
Series was issued, the Company imposed a maximum annual dividend rate of 26% on
the Auction Series and used the 26% rate for purposes of calculating the annual
dividend requirement on the Auction Series, even though the actual initial
dividend rate on such series was less than 3%.
The existing test is also silent as to the applicability of this test to
the issuance of securities convertible into Cumulative Preferred Stock or any
prior or parity ranking stock. The amendment clarifies that the Company must
comply with the test of Paragraph (5)(c) of Section A of Article IV (or obtain
the necessary shareholder vote) to issue convertible securities.
For purposes of the future application of the above gross income test with
regard to the Auction Series, and in order to avoid imposing a similar maximum
dividend rate for future series of Cumulative Preferred Stock, or prior or
parity ranking stock or convertible securities, the Variable Dividend Proposal
specifies the method of calculating the annual requirements on securities having
interest or dividends determined according to an adjustable, floating or
variable rate. Such calculation will be as follows: (i) for Cumulative Preferred
Stock or such securities proposed to be issued with an adjustable, floating or
variable rate, the dividend rate used will be the dividend rate to be applicable
to such series on the date of its issuance, (ii) for any outstanding funded
indebtedness or short term indebtedness which has a variable interest rate, and
for any outstanding series of Cumulative Preferred Stock, parity or prior
ranking stock or convertible securities which has a variable dividend, the
interest or dividend rate used will be the daily weighted average annual
interest or dividend rate applicable to such security (a) during any consecutive
twelve-month period selected by the Company, which period ends within 90 days
prior to such proposed issuance of the new Cumulative Preferred Stock, or (b) if
the security has been outstanding for less than twelve full calendar months,
during such shorter period beginning on the date of issuance of such security
and ending on a date selected by the Company, which date is not more that 45
days prior to such issuance; provided that if such security has been issued
within 45 days prior to such proposed issuance of the new Cumulative Preferred
Stock, the interest or dividend rate will be that applicable on the date of
issuance of such security.
Although the amendment will provide a method to compute the annual dividend
requirement for stock with an adjustable, floating or variable dividend rate,
including the Auction Series, the proposed changes will not eliminate the 26%
maximum dividend rate for the Auction Series. Under the Articles, upon the
adoption of the Variable Dividend Proposal the Company will have the option of
eliminating the 26% maximum dividend rate for the Auction Series but has no
present intention to do so.
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The proposed amendments will make other miscellaneous changes to Article IV
that will not affect any outstanding shares of Cumulative Preferred Stock. The
proposed amendments would clarify the language in Article IV by specifically
indicating that the Board of Directors may fix or determine rates of dividends
that may be expressed in terms of a formula or other method by which such rates
may be calculated or ascertained from time to time. Such change is consistent
with the Company's and its legal counsel's current interpretation of Article IV
and will remove any ambiguity regarding this matter. In various places in the
Articles certain phrases that assume all series of Cumulative Preferred Stock
have only one fixed dividend rate are replaced with phrases such as "dividend
rate or rates" or similar language to clarify that certain series may have one
or more applicable rates. The exact language of all changes to the Articles
included in the Variable Dividend Proposal is set out in Exhibit B.
RECOMMENDATION. The Board of Directors believes that the Variable Dividend
Proposal is in the best interests of the Company's shareholders, as it will
enhance the Company's ability to issue new series of Cumulative Preferred Stock
and to set dividend policy with respect to the Auction Series with terms most
favorable to the Company. If adopted the Variable Dividend Proposal will enable
the Company, at the option of the Board of Directors, to take full advantage of
new financing techniques that may provide a lower cost of capital to the
Company. FOR THE REASONS STATED ABOVE, THE BOARD OF DIRECTORS RECOMMENDS THAT
THE COMPANY'S SHAREHOLDERS VOTE "FOR" THE VARIABLE DIVIDEND PROPOSAL.
MAJORITY VOTE PROPOSAL
GENERAL. Illinois law provides that amendments to the Articles require the
vote of the holders of two-thirds of outstanding shares, including the holders
of two-thirds of any class or series which is entitled to a class vote on the
amendment. This two-thirds requirement may be modified by the Articles. The
Company proposes to add a provision to the Articles which would supersede the
two-thirds requirement. Under the proposal the affirmative vote of the holders
of a majority of all outstanding shares, and a majority of any class or series
entitled to a class vote, would be sufficient to approve future amendments to
the Articles.
The purpose of the proposal is to make it easier to obtain shareholder
approval for future amendments to the Articles. This will increase the Company's
flexibility to make desirable changes in the Articles. As indicated above,
CIPSCO holds all of the outstanding common stock of the Company and more than
two-thirds of all outstanding common stock and preferred stock together.
Accordingly, any proposed amendment favored by CIPSCO requiring a simple vote of
all outstanding shares is assured of adoption. Because it is unlikely that
CIPSCO would at any time in the near future own less than a majority of all
outstanding common stock and preferred stock, the Majority Vote Amendment is not
likely to have any affect on CIPSCO's ability to approve such future amendments.
On the other hand, for any proposed future amendment that affects the preferred
stock in such a way that the preferred stock is entitled under the Articles or
applicable law to a class vote, in addition to a vote of all outstanding stock,
the Majority Vote Proposal would make it easier to adopt such amendment. In such
case, it would only be necessary to obtain the favorable vote of the holders of
a majority of outstanding preferred stock instead of the two-thirds vote now
required. However, under the Articles, the preferred stock will continue to have
a two-thirds class vote to authorize the Company to take any of the following
actions: (i) amend the Articles to create or authorized any stock ranking prior
in any respect to the preferred stock or any security convertible
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<PAGE> 22
into shares of such stock, (ii) change, by amendment to the Articles or
otherwise, the terms and provisions of the preferred stock so as to affect
adversely the rights and preferences of the holders thereof or (iii) issue any
shares of preferred stock or stock ranking on a parity therewith unless the
Company's gross income is at least one and one-half times the annual dividend
and interest requirements on certain securities of the Company. (The provisions
of the Articles referred to in clause (iii) above are proposed to be amended by
the Variable Dividend Proposal. See "Variable Dividend Proposal--General"
above.)
The Majority Vote Amendment will not change the current requirements of
Illinois law that certain mergers, consolidations, sales of substantially all
assets and certain other major corporate actions be approved by a two-thirds
vote. Illinois law permits the two-thirds requirement for such matters to be
reduced, if so provided in the articles of incorporation, to a lesser voting
requirement, but not less than a majority. Accordingly, if the Majority Vote
Proposal is adopted, the Company could propose future amendments to the Articles
that would reduce the vote necessary to approve these major corporate actions.
Approval of such future amendments would then only require a majority vote. Even
if such a future amendment to reduce the voting requirements for such major
corporate actions were approved, the two-thirds voting requirements of the
preferred stock currently set out in the Articles, as described in the preceding
paragraph, would not be altered. The Company has no current plans to propose any
such amendments to reduce the voting requirements for major corporate actions.
RECOMMENDATION. The Board of Directors believes the Majority Vote Proposal
is consistent with good corporate governance and is in the best interests of the
Company and its preferred shareholders. The Majority Vote Proposal will increase
the Company's flexibility to adopt desirable amendments to its Articles in the
future. The Company will be able to adopt desirable amendments that are approved
by a majority of shareholders. The Company believes that a majority vote is the
recognized standard in modern corporate practice for approval of charter
amendments. As indicated above, the rights under the Articles of preferred
stockholders to approve certain actions by a two-thirds vote will not be
changed. Statutory provisions requiring a class vote of preferred shareholders
will also remain unchanged. Accordingly, the Board of Directors believes the
rights of preferred shareholders are, and will continue to be, adequately
protected. The Company is not currently aware of any amendments that would be
proposed to the Articles in the event the Majority Vote Proposal is adopted. FOR
THE REASONS STATED ABOVE, THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S
SHAREHOLDERS VOTE "FOR" THE MAJORITY VOTE PROPOSAL.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed the firm of Arthur Andersen & Co. as
independent public accountants to examine the annual financial statements of the
Company for 1994. The firm has served as the Company's independent public
accountants to examine the annual financial statements of the Company for many
years, including 1993. A representative of Arthur Andersen & Co. will be present
at the annual meeting to make a statement if he or she or desires, and to
respond to questions.
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OTHER MATTERS
Article VI (h) of the Company Bylaws requires reporting indemnity payments
or advances of expenses associated with such indemnity made to any director,
officer, employee or agent of the Company. In 1993, the Company entered into
three such agreements with current and past employees named in various lawsuits.
During 1993, the Company paid $62,674.45 in expenses under such agreements. All
expenses so advanced for the benefit of any person must be repaid to the Company
if it is ultimately determined that such person is not entitled to be
indemnified by the Company.
At the date hereof, the Board of Directors of the Company knows of no
business to come before the meeting other than those described above. However,
should any such business properly come before the meeting, the proxies will be
voted in respect thereof in accordance with the judgment of the person or
persons voting the proxies.
Central Illinois Public Service Company
By Order of the Board of Directors,
R. W. Jackson
Senior Vice President and Secretary
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EXHIBIT A
The EEI Index of 100 utilities presented in the Performance Graph on page
13 of this proxy statement includes the following companies:
Allegheny Power System, Inc.
American Electric Power, Inc.
Atlantic Energy, Inc.
Baltimore Gas & Electric Co.
Bangor Hydro-Electric Co.
Black Hills Corp.
Boston Edison Co.
Carolina Power & Light Co.
Centerior Energy Corp.
Central & South West Corp.
Central Hudson Gas & Electric
Central Louisiana Electric Co., Inc.
Central Maine Power Co.
Central Vermont Public Service Corp.
Cilcorp Inc.
Cincinnati Gas & Electric Co.
CIPSCO Inc.
CMS Energy Corp.
Commonwealth Edison Co.
Commonwealth Energy System
Consolidated Edison Co. of NY
Delmarva Power & Light Co.
Detroit Edison Co.
Dominion Resources, Inc.
DPL Inc.
DQE Inc.
Duke Power Co.
Eastern Utilities Assoc.
El Paso Electric Co.
Empire District Electric Co.
Entergy Corp.
ESELCO Inc.
Florida Progress Corp.
FPL Group, Inc.
General Public Utilities Corp.
Green Mountain Power Corp.
Gulf States Utilities Co.
Hawaiian Electric Industries, Inc.
Houston Industries, Inc.
Idaho Power Co.
IES Industries, Inc.
Illinois Power Co.
Interstate Power Co.
Iowa-Illinois Gas & Electric Co.
IPALCO Enterprises, Inc.
Kansas City Power & Light Co.
KU Energy Corp.
LG&E Energy Corp.
Long Island Lighting Co.
Madison Gas & Electric Co.
Maine Public Service Co.
Midwest Resources Inc.
Minnesota Power
Montana Power Co.
Nevada Power Co.
New England Electric System
New York State Electric & Gas Corp.
Niagara Mohawk Power Corp.
NIPSCO Industries, Inc.
Northeast Utilities
Northern States Power Co.
Northwestern Public Service Co.
Ohio Edison Co.
Oklahoma Gas & Electric Co.
Orange & Rockland Utilities, Inc.
Otter Tail Power Co.
Pacific Gas & Electric Co.
Pacificorp
Pennsylvania Power & Light Co.
Philadelphia Electric Co.
Pinnacle West Capital Corp.
Portland General Corp.
Potomac Electric Power Corp.
PSI Resources, Inc.
Public Service Co. of Colorado
Public Service Co. of New Mexico
Public Service Enterprise Group
Puget Sound Power & Light Co.
Rochester Gas & Electric Corp.
San Diego Gas & Electric Co.
SCANA Corp.
SCECORP
Sierra Pacific Resources
Southern Company
A-1
<PAGE> 25
EXHIBIT B
AMENDED PROVISIONS OF RESTATED AND AMENDED
ARTICLES OF INCORPORATION
(Note: added language is shown by underscoring and
deleted language is shown by brackets.)
ARTICLE IV
A. CUMULATIVE PREFERRED STOCK
(1) The authorized shares of the Cumulative Preferred Stock (including all
shares of authorized Cumulative Preferred Stock at any time having the status of
authorized and unissued shares thereof) may be divided into and issued as shares
of any series thereof now outstanding, or divided into and issued in one or more
other series thereof, as the Board of Directors of the corporation shall from
time to time authorize. Each series shall be designated so as to distinguish the
shares thereof from the shares of all other series then outstanding; and all
shares of the Cumulative Preferred Stock, irrespective of series, shall be
identical except as to variations between different series in the relative
rights and preferences thereof as permitted or contemplated by the next
succeeding sentence of this paragraph (1). Authority is hereby expressly vested
in the Board of Directors of the corporation to establish out of the authorized
and unissued shares of Cumulative Preferred Stock one or more series thereof and
to fix and determine the following relative rights and preferences of the shares
of any such series:
(a) the rate or rates of dividend, which may be expressed in terms of
a fixed rate or rates or formula or other method by which such rate or
rates shall be calculated or ascertained from time to time, and the
dividend periods, including the date or dates on which such dividends may
be payable;
(b) the prices at which, and the terms and conditions on which, shares
may be redeemed; and
(c) sinking fund provisions, if any, for the redemption or purchase of
shares;
subject, however, to such restrictions as are, or may be, from time to time
provided by law or contained in the Articles of Incorporation of the corporation
or amendments thereto.
(2) The holders of the Cumulative Preferred Stock from time to time
outstanding shall be entitled to receive, in respect of each share held,
dividends upon the par value thereof at the [annual rate specified in the
designation of such share] rate or rates applicable thereto, payable quarter-
yearly on March 31, June 30, September 30 and December 31 in each year, or on
such other dates in each year, or payable for such other dividend periods and on
such dates, as may be fixed by the Board of Directors of the corporation or
provided in the Articles of Incorporation, but only when and as declared by the
Board of Directors out of surplus or net profits of the corporation available
for the payment of dividends. Such dividends shall be cumulative in respect of
each share from (and including) the date of issue thereof, and shall be paid, or
declared and set apart for payment, before any dividend shall be declared or
paid on or set apart for the Common Stock, so that, if for any past or current
period dividends on the Cumulative Preferred Stock shall not have been paid or
declared and set apart for payment, the deficiency shall be fully paid or
declared and funds set apart for the payment thereof before any dividends shall
be declared or paid on or set apart for the Common
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Stock. The holders of the Cumulative Preferred Stock shall not be entitled to
receive any dividends thereon except dividends at the [annual] applicable rate
[hereinbefore provided] or rates. No dividend shall at any time be paid on or
set apart for any share of Cumulative Preferred Stock in respect of a dividend
period unless at the same time there shall be paid on or set apart, for all
shares of Cumulative Preferred Stock and all shares of Cumulative No Par
Preferred Stock then outstanding and having a dividend period ending on the same
date, dividends in such amount that the holders of all such shares of Cumulative
Preferred Stock and the holders of all such shares of Cumulative No Par
Preferred Stock shall receive or have set apart for them a uniform percentage of
the full annual dividend to which they are, respectively, entitled and unless
all dividends on the Cumulative Preferred Stock and Cumulative No Par Preferred
Stock, for all preceding dividend periods, shall have been fully paid or
declared and funds set apart for the payment thereof. It shall be a condition
precedent to the declaration by the Board of Directors and the payment of
dividends on the Common Stock, that all amounts required to be paid or set aside
for any sinking fund for the redemption or purchase of shares of Cumulative
Preferred Stock or Cumulative No Par Preferred Stock of all series then
outstanding, with respect to all preceding sinking fund dates or periods, shall
have been paid or set aside in accordance with the terms of the shares of such
series. No funds shall be paid into or set aside for any sinking fund for the
redemption or purchase of shares of Cumulative Preferred Stock or Cumulative No
Par Preferred Stock of any series unless all dividends on the Cumulative
Preferred Stock and on the Cumulative No Par Preferred Stock, for all preceding
dividend periods, shall have been fully paid or declared and funds set apart for
the payment thereof. All shares of Cumulative Preferred Stock, regardless of
designation, shall constitute one class of stock and, excepting only as to the
rate or rates of dividends payable thereon, the dividend periods and dividend
payment dates applicable thereto, the redemption prices thereof and the sinking
fund provisions thereof, shall be of equal rank and confer equal rights upon the
holders thereof. All shares of Cumulative Preferred Stock bearing the same
[dividend rate] distinctive series designation at any time outstanding shall
constitute one series of Cumulative Preferred Stock and all shares of any one
series of Cumulative Preferred Stock shall be alike in all respects. When full
cumulative dividends upon the Cumulative Preferred Stock and the Cumulative No
Par Preferred Stock of all series then outstanding, for all past periods and for
the current period shall have been paid or declared and set apart for payment,
and all amounts required to be paid or set aside for any sinking fund for the
redemption or purchase of shares of Cumulative Preferred Stock and Cumulative No
Par Preferred Stock of all series then outstanding, with respect to all
preceding sinking fund dates or periods, shall have been paid or set aside in
accordance with the terms of the shares of such series, the Board of Directors
may declare dividends on the Common Stock of the corporation, subject to the
restrictions hereinafter contained, and not otherwise.
(4) The corporation, on the sole authority of its Board of Directors, shall
have the right at any time or from time to time to redeem and retire all or part
of the Cumulative Preferred Stock or all or part of the shares of one or more
series of Cumulative Preferred Stock upon and by the payment to the holders of
the shares to be redeemed or upon and by setting aside, as hereinafter provided,
for the benefit of such holders, the redemption price or prices fixed for the
shares to be redeemed, which (a) in the case of shares of 4% Cumulative
Preferred Stock shall be $101 per share plus accrued dividends to the date of
redemption, (b) in the case of shares of 4.92% Cumulative Preferred Stock shall
be $103.50 per share plus accrued dividends to the date of redemption, (c) in
the case of shares of 4 1/4% Cumulative Preferred Stock shall be $102 per share
plus accrued dividends to the date of redemption, (d) in the case of shares of
5.16% Cumulative Preferred Stock
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shall be $102 per share plus accrued dividends to the date of redemption, (e) in
the case of shares of 4.90% Cumulative Preferred Stock shall be $102 per share
plus accrued dividends to the date of redemption, (f) in the case of shares of
Cumulative Preferred Stock -- Auction Series A shall be as specified in
paragraph (9) of this Section A, and (g) in the case of shares of 6.625%
Cumulative Preferred Stock shall be $100 per share plus accrued dividends to the
date of redemption, provided that none of the shares of 6.625% Cumulative
Preferred Stock may be redeemed prior to October 1, 1998; provided, however,
that, as to the Cumulative Preferred Stock to be so redeemed, notice of every
such redemption shall be given at such time, in such form and in such manner as
may have been determined and fixed for such stock by the Board of Directors of
the corporation at the time of establishment of such stock or, if such matters
have not been so determined and fixed by the Board of Directors, not less than
thirty (30) days previous to the date fixed for redemption, notice of the
intention of the corporation to redeem such stock, specifying the designation of
the shares to be redeemed and the date and place of redemption, shall be
deposited in a United States post office or mail box at any place in the United
States addressed to each holder of record of the shares to be redeemed at his
address as the same appears upon the records of the corporation; but in mailing
such notice unintentional omissions or errors in names and addresses shall not
impair the validity of the notice of redemption. In case of the redemption of
less than all the outstanding shares of any series of the Cumulative Preferred
Stock, the shares of such series to redeemed shall be chosen by proration (as
nearly as may be without the issue of fractional shares), by lot, or in such
other equitable manner as may be prescribed by resolution of the Board of
Directors. The corporation may deposit with a bank or trust company, which shall
be named in the notice of redemption, shall be located in the City of Chicago,
Illinois, or in the City of New York, New York, and shall then have capital,
surplus and undivided profits of at least $1,000,000, the aggregate redemption
price of the shares to be redeemed, in a special account or in trust, as the
corporation may determine, for the payment on or before the redemption date to
or upon the order of the holders of such shares, upon surrender of the
certificates for such shares. Such deposit may, at the option of the
corporation, be upon terms whereby in case the holder of any shares called for
redemption shall not, within ten years after the date fixed for redemption of
such shares, claim the amount on deposit with any bank or trust company for the
payment of the redemption price of said shares, such bank or trust company shall
on demand pay to or upon the written order of the corporation, or its successor,
the amount so deposited and thereupon such bank or trust company shall be
released from any and all further liability with respect to the payment of such
redemption price and the holder of said shares shall be entitled to look only to
the corporation or its successor for the payment thereof. Upon the giving of
notice of redemption and upon the deposit of the redemption price, as aforesaid,
or, if no such deposit is made upon the redemption date (unless the corporation
defaults in making payment of the redemption price as set forth in such notice),
such holders shall cease to be stockholders with respect to said shares, and
from and after the making of said deposit and the giving of said notice, or, if
no such deposit is made, after the redemption date (the corporation not having
defaulted in making payment of the redemption price as set forth in such
notice), said shares shall no longer be transferable on the books of the
corporation, and said holder shall have no interest in or claim against the
corporation with respect to said shares, but shall be entitled only to receive
on the date fixed for redemption, the redemption price of the shares, without
interest thereon, from said bank or trust company, if deposited therewith as
aforesaid and not repaid to the corporation, and otherwise from the corporation,
upon surrender of the certificates as aforesaid.
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Nothing herein contained shall limit any legal right of the corporation to
purchase any shares of the Cumulative Preferred Stock.
(5) So long as any shares of Cumulative Preferred Stock of any series are
outstanding, the corporation shall not, without the affirmative vote of the
record holders of two-thirds of the outstanding shares of Cumulative Preferred
Stock of all series, voting separately as one class:
(a) Amend the provisions of the Articles of Incorporation so as to
create or authorize any stock ranking prior in any respect to the
Cumulative Preferred Stock or any security convertible into shares of such
stock; or issue any such stock or convertible security; or
(b) Change, by amendment to the Articles of Incorporation, or
otherwise, the terms and provisions of the Cumulative Preferred Stock so as
to affect adversely the rights and preferences of the holders thereof;
provided, however, that if any such change will affect adversely the
holders of one or more, but less than all, of the series of Cumulative
Preferred Stock at the time outstanding, the consent only of the holders of
at least two-thirds of the total number of shares of each series so
adversely affected shall be required; or
(c) Issue any shares of the Cumulative Preferred Stock or shares of
any stock ranking on a parity with the Cumulative Preferred Stock, or any
securities convertible into shares of such stock, other than in exchange
for, or for the purpose of effecting the redemption or other retirement of,
shares of Cumulative Preferred Stock [or], of any stock ranking on a parity
therewith, or [both] of any such convertible securities, or any combination
thereof, at the time outstanding, having an aggregate amount of par value
and stated value of not less than the aggregate amount of par value or
stated value of the shares to be issued, or other than in connection with
the conversion of such convertible securities in accordance with their
terms unless:
(1) The gross income (determined in accordance with accepted
accounting principles) of the corporation available for the payment of
interest charges shall, for a period of twelve consecutive calendar
months within the fifteen calendar months next preceding the issue of
such shares, have been at least one and one-half (1 1/2) times the sum
of (i) the interest for one year, adjusted by provision for amortization
of debt discount and expense, or of premium, as the case may be, on all
funded indebtedness and notes payable of the corporation maturing more
than twelve months after the date of issue of such shares or convertible
securities which shall be outstanding at the date of the issue of such
shares or convertible securities, and (ii) an amount equal to the
dividend requirement for one year on all shares of Cumulative Preferred
Stock and on all other shares of stock, if any, ranking prior to or on a
parity with the Cumulative Preferred Stock, which shall be outstanding
after the issue of the shares or convertible securities proposed to be
issued (including as outstanding for this purpose shares of Cumulative
Preferred Stock or shares of such stock issuable on conversion of any
such convertible securities), provided that for purposes of making the
calculation required by the foregoing provisions of this subclause (1):
(A) the "dividend requirement for one year" applicable to any series of
Cumulative Preferred Stock or such parity stock or convertible
securities proposed to be issued which will have dividends determined
according to an adjustable, floating or variable rate, the dividend rate
used shall be the dividend rate to be applicable to such series of
Cumulative Preferred Stock or such parity stock or convertible
securities on the date of such issuance and
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(B) the "interest for one year" on funded indebtedness or notes
outstanding and the "dividend requirement for one year" on any
outstanding shares of any series of Cumulative Preferred Stock or shares
of stock, if any, ranking prior to or on a parity with the Cumulative
Preferred Stock, or securities convertible into such stock, and having
interest or dividends determined according to an adjustable, floating or
variable rate, the interest or dividend rate used shall be the daily
weighted average annual interest or dividend rate applicable to such
security (a) during any consecutive twelve-month period selected by the
corporation, which period ends within 90 days prior to the issue of the
shares or convertible securities proposed to be issued or (b) if the
security has been outstanding for less than twelve full calendar months,
during such shorter period beginning on the date of issuance of such
security and ending on a date selected by the corporation, which date is
not more than 45 days prior to the issue of the shares or convertible
securities proposed to be issued; provided that if such security shall
have been issued within 45 days prior to the issue of the shares or
convertible securities proposed to be issued, the interest or dividend
rate shall be that applicable on the date of issuance of such security;
and
(2) The capital represented by the Common Stock plus the surplus
accounts of the corporation shall be not less than the aggregate amount
payable on the involuntary dissolution, liquidation or winding up of the
corporation, in respect of all shares of Cumulative Preferred Stock and
all shares of stock, if any, ranking prior thereto or on a parity
therewith, which shall be outstanding after the issue of the shares or
convertible securities proposed to be issued (including as outstanding
for this purpose shares of Cumulative Preferred Stock or shares of such
stock issuable on conversion of any such convertible securities).
No consent of the holders of Cumulative Preferred Stock shall be required
in respect of any transaction enumerated in this paragraph (5) if, at or prior
to the time when such transaction is to take effect, provision is made for the
redemption or other retirement of all shares of Cumulative Preferred Stock at
the time outstanding, the consent of which would otherwise be required
hereunder.
B. CUMULATIVE NO PAR PREFERRED STOCK
(1) The authorized shares of Cumulative No Par Preferred Stock (including
all shares of such stock at any time having the status of authorized and
unissued shares of such stock) may be divided into and issued in one or more
series as the Board of Directors of the corporation shall from time to time
authorize. Each series shall be designated so as to distinguish the shares
thereof from the shares of all other series, and all shares of the Cumulative No
Par Preferred Stock irrespective of series shall be identical except as to
variations between different series in the relative rights and preferences
thereof as permitted or contemplated by the next succeeding sentence of this
paragraph (1). Authority is hereby expressly vested in the Board of Directors of
the corporation to establish out of the authorized and unissued shares of
Cumulative No Par Preferred Stock one or more series thereof and to fix and
determine the following relative rights and preferences of the shares of any
such series:
(a) the rate [of dividend (which shall be stated in the designation of
the shares of such series);] or rates of dividend, which may be expressed
in terms of a fixed rate or rates or
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formula or other method by which such rate or rates shall be calculated or
ascertained from time to time, and the dividend periods, including the date
or dates on which such dividends may be payable;
(b) the [price] prices at which, and the terms and conditions on
which, shares of such series may be redeemed;
(c) the amount payable upon shares of such series in the event of the
involuntary liquidation, dissolution or winding up of the corporation and
the amount payable upon shares of such series in the event of the voluntary
liquidation, dissolution or winding up of the corporation;
(d) sinking fund provisions, if any, for the redemption or purchase of
shares of such series; and
(e) the terms and conditions on which shares of such series may be
converted, if such shares are issued with the privilege of conversion;
subject, however, to such restrictions as are, or may be, from time to time
provided by law or contained in the Articles of Incorporation of the corporation
or amendments thereto.
Shares of any series of Cumulative No Par Preferred Stock may be issued for
such consideration, not less than the aggregate preferential amount, other than
accrued dividends, payable upon such shares in the event of the involuntary
liquidation, dissolution or winding up of the corporation, as may be fixed by
the Board of Directors prior to the time of such issuance and, except as
otherwise determined by the Board of Directors in accordance with the provisions
of the law of the State of Illinois applicable thereto, the entire amount of
such consideration shall constitute stated capital in respect of such shares.
D. GENERAL PROVISIONS
(2) The term "accrued dividends" shall be deemed to mean, in respect of any
share of Cumulative Preferred Stock or Cumulative No Par Preferred Stock as of
any given date, the amount of dividends payable on such share, computed, at the
[annual] dividend rate [fixed for] or rates applicable to such share, from the
date on which dividends thereon became cumulative to and including such given
date, less the aggregate amount of all dividends which have been paid or which
have been declared and set apart for payment on such share. Accumulations of
dividends shall not bear interest.
(4) Except as otherwise expressly set forth in the Articles of
Incorporation of the corporation or as specifically required by law, any
amendment to the Articles of Incorporation of the corporation requiring approval
of shareholders shall be adopted upon receiving the affirmative vote of the
holders of a majority of the outstanding shares entitled to vote on the
amendment and a majority of the outstanding shares of each class or series of
shares, if any, entitled to vote as a class on the amendment.
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Graphic Material Appendix
The performance graph required by Item 402(1) of Regulation S-K is on page 13
of this filing. The paper copy has a line graph with three differentiated
lines showing the returns given in the data presented on page 13. A paper copy
of the graph has been submitted supplementally to the Branch Chief pursuant to
Regulation S-T, Item 304(d)(2).
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SOLICITED BY THE BOARD OF DIRECTORS OF CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
Proxy. The undersigned appoints, C. L. Greenwalt and R. W. Jackson, and each
of them, with power of substitution, attorneys and proxies to vote all shares
of Preferred Stock of CENTRAL ILLINOIS PUBLIC SERVICE COMPANY of record, in the
name of the undersigned at the close of business on March 1, 1994, as indicated
hereon and, in their discretion, on all other matters which may properly come
before the 1994 Annual Meeting of Shareholders, and at all adjourned sessions
thereof, all as set forth in the notice and proxy statement.
Dated ______________________________
____________________________________
Signed
_____________________________________
MARK "X" HERE TO VOTE WITH DIRECTOR'S RECOMENDATIONS: / /
All shares will be voted in accordance with the Board of Director's
recommendations if you mark the box above (any contrary marking on the reverse
side will be disregarded) or leave all boxes unmarked. If you wish to vote
other than with the Director's recommendations, specify your choices by marking
the appropriate boxes on the reverse side.
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If you have marked the box on the reverse side of this card, you need NOT
complete the sections below. The votes represented by this proxy will be
voted as marked by you. If you sign and return the proxy unmarked or mark the
box on the reverse, such votes will be voted "FOR" the election of directors
and "FOR" Proposals 1, 2 and 3. No proposal is related to or conditioned on
any other proposal.
DIRECTORS RECOMMEND A Vote "FOR" Items 1, 2 and 3.
1. Election of Directors
/ / With Authority to vote for all nominees (except as marked to the
contrary.)
/ / Withhold Authority to vote for all Nominees
W. J. Alley C. L. Greenwalt J. L. Keath
R. W. Jackson G. R. Lehuman W. M. Merriman
D. O. Rayomer T. L. Shade J. W. Wogsland
Withhold for the following only (write the nominee's names(s) in the
space below.)
_______________________________________________________________________
For Against Abstain
2. Variable Dividend Propsal / / / / / /
3. Majority Vote Proposal / / / / / /
Please mark your vote with an /X/ then date proxy and sign on reverse side
exactly as name(s) printed and return signed proxy in enclosed envelope. If
joint account, each joint owner should sign, state title when signing as
executer, administrator, trustee, guardian, etc.
(To be signed on reverse side)
