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
[ ]Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ X ]Definitive Proxy Statement
[ ]Definitive Additional Materials
[ ]Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Century Telephone Enterprises, Inc.
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(Name of Registration as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ]No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)
(1) and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee is paid:
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[ ]Fee paid previously with preliminary materials.
[ ]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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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[CTEI LETTERHEAD]
Dear Shareholder:
The enclosed proxy card solicited on behalf of the Board of Directors
of Century Telephone Enterprises, Inc. indicates the number of votes that
you will be entitled to cast at the Company's Annual Meeting of
Shareholders to be held May 7, 1998, according to the stock records of the
Company. At the Annual Meeting, the shareholders will consider and vote
upon the election of five Class I directors.
The Company's Articles of Incorporation, the relevant provisions of
which are printed on the reverse side of this letter, provide that each
voting share of the Company that has been "beneficially owned" continuously
since May 30, 1987 entitles the holder thereof to ten votes, subject to
compliance with certain procedures; each other voting share entitles the
holder thereof to one vote. In general, shares registered in the name of
any natural person or estate that are represented by certificates dated
prior to May 30, 1987 are presumed to have ten votes per share. All other
shares are presumed to have only one vote per share.
The Articles of Incorporation, however, set forth a list of
circumstances in which the foregoing presumption may be refuted. Please
review the provisions on the reverse side of this letter and, if you
believe that the information set forth on your proxy card is incorrect or a
presumption made with respect to your shares should not apply, send a
letter to the Company at the above address briefly describing the reasons
for your belief. Merely marking the proxy card will not be sufficient
notification to the Company that you believe the voting information thereon
is incorrect.
The Company will consider all letters received prior to the date of
the Annual Meeting and, when a return address is provided in the letter,
will promptly advise each shareholder concerned of its decision with
respect thereto, although in many cases the Company will not have time to
inform a shareholder of its decision prior to the time the shares are
voted. In limited circumstances, the Company may require additional
information before a determination will be made. If you have any questions
about the Company's voting procedures, please call the Company at (318)
388-9500.
Very truly yours,
/s/ Clarke M. Williams
Clarke M. Williams
Chairman of the Board
March 19, 1998
<PAGE>
[CTEI LETTERHEAD]
Dear Shareholder:
The enclosed proxy card solicited on behalf of the Board of Directors of
Century Telephone Enterprises, Inc. indicates the number of shares that you
will be entitled to have voted at the Company's Annual Meeting of
Shareholders to be held May 7, 1998, according to the records of your broker,
bank or other nominee. At the Annual Meeting, the shareholders will consider
and vote upon the election of five Class I directors.
The Company's Articles of Incorporation, the relevant provisions of
which are printed on the reverse side of this letter, provide that each
voting share of the Company that has been "beneficially owned" continuously
since May 30, 1987 entitles the holder thereof to ten votes, subject to
compliance with certain procedures; each other voting share entitles the
holder thereof to one vote. All shares held through a broker, bank or other
nominee, however, are presumed to have one vote per share. The Articles of
Incorporation set forth a list of circumstances in which this presumption may
be refuted by the person who has held all of the attributes of beneficial
ownership referred to in Paragraph 2 of the voting provisions printed on the
reverse side of this letter since May 30, 1987. Please review those
provisions and, if you believe that some or all of your shares are entitled
to ten votes, you may follow one of the two procedures outlined below.
First, you may write a letter to the Company at the above address
describing the reasons for your belief. The letter should contain your name
(unless you prefer to remain anonymous), the name of the brokerage firm, bank
or other nominee holding your shares, your account number with such nominee
and the number of shares you have beneficially owned continuously since May
30, 1987. Alternatively, you may ask your broker, bank or other nominee to
write a letter to the Company on your behalf stating your account number and
indicating the number of shares that you have beneficially owned continuously
since May 30, 1987. In either case, your letter should indicate how you wish
to have your shares voted at the Annual Meeting so that, once a determination
as to voting power is made, your votes may be counted.
The Company will consider all letters received prior to the date of the
Annual Meeting and, when a return address is provided in the letter, will
promptly advise the party furnishing such letter of its decision with respect
thereto, although in many cases the Company will not have time to inform an
owner or nominee of its decision prior to the time the shares are voted. In
limited circumstances, the Company may require additional information before
a determination will be made. If you have any questions about the Company's
voting procedures, please call the Company at (318) 388-9500.
Very truly yours,
/s/ Clarke M. Williams
Clarke M. Williams
Chairman of the Board
March 19, 1998
<PAGE>
[CTEI LETTERHEAD]
Dear Participants in the Company's Stock Bonus Plan and PAYSOP, Employee
Stock Ownership Plan, Dollars & Sense Plan or Retirement Savings Plan for
Bargaining Unit Employees:
As a participant in one or more of the above-listed plans you are
entitled to direct the exercise of voting power with respect to shares of
the Company's Common Stock held in such plans in connection with the
Company's Annual Meeting of Shareholders to be held May 7, 1998. At such
meeting, the shareholders will consider and vote upon the election of five
Class I directors.
If you choose to direct the exercise of the plans' voting power, all
of your instructions (subject to certain limited exceptions) will be deemed
to be made by you in your capacity as a "named fiduciary" under the plans,
which require you to direct your votes in a manner that you believe to be
prudent and in the best interests of the participants of each respective
plan. If you wish to direct the exercise of such voting power in such
manner, please complete and return the enclosed voting instruction card or
cards no later than the close of business on May 5, 1998 in accordance with
the accompanying instructions.
Many of you will receive the attached proxy materials of the Company
from both (i) Regions Bank, which is the trustee for the Company's Stock
Bonus Plan and PAYSOP and Employee Stock Ownership Plan, and (ii) Merrill
Lynch Trust Company FSB, which is the trustee for the Company's Dollars &
Sense and Retirement Savings Plans. To ensure that your voting
instructions are counted, please carefully review the instructions
separately provided by each such trustee. It is important that all voting
instruction cards relating to the Stock Bonus, PAYSOP or Employee Stock
Ownership Plans are returned ONLY to Regions Bank and that all voting
instruction cards relating to the Dollars & Sense and Retirement Savings
Plans are returned ONLY to Merrill Lynch.
If after reading the accompanying instructions you have any questions
regarding the enclosed voting instruction cards, please contact the trustee
responsible for administering the plan or plans to which your questions
relate.
Very truly yours,
/s/ Clarke M. Williams
Clarke M. Williams
Chairman of the Board
March 19, 1998
<PAGE>
CENTURY TELEPHONE ENTERPRISES, INC.
100 CENTURY PARK DRIVE
MONROE, LOUISIANA 71203
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO THE SHAREHOLDERS OF
CENTURY TELEPHONE ENTERPRISES, INC.
The Annual Meeting of Shareholders of Century Telephone Enterprises,
Inc. will be held at 2:00 p.m., local time, on May 7, 1998 at the Holiday
Inn Professional Centre Atrium, 2011 Louisville Avenue, Monroe, Louisiana,
for the following purposes:
1. To elect five Class I directors; and
2. To transact such other business as may properly come before the
meeting and any adjournments thereof.
The Board of Directors has fixed the close of business on March 9,
1998, as the record date for the determination of shareholders entitled to
notice of and to vote at the meeting and all adjournments thereof.
By Order of the Board of Directors
/s/ Harvey P. Perry
HARVEY P. PERRY, Secretary
Dated: March 19, 1998
________________________________________
SHAREHOLDERS ARE INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. EVEN IF
YOU EXPECT TO ATTEND, IT IS IMPORTANT THAT YOU PLEASE SIGN, DATE AND RETURN
THE ENCLOSED PROXY CARD PROMPTLY. IF YOU PLAN TO ATTEND AND WISH TO VOTE
YOUR SHARES PERSONALLY, YOU MAY DO SO AT ANY TIME BEFORE YOUR PROXY IS
VOTED.
________________________________________
<PAGE>
VOTING PROVISIONS
Paragraph C of Article III of the Company's Articles of Incorporation
provides as follows:
* * * *
(1) Each share of Common Stock and each outstanding share of the Series H
Preferred Stock ("Voting Preferred Stock") which has been beneficially owned
continuously by the same person since May 30, 1987 will entitle such person to
ten votes with respect to such share on each matter properly submitted to the
shareholders of the Corporation for their vote, consent, waiver, release or
other action when the Common Stock and the Voting Preferred Stock vote together
with respect to such matter.
(2) (a) For purposes of this paragraph C, a change in beneficial
ownership of a share of the Corporation's stock shall be deemed to have
occurred whenever a change occurs in any person or group of persons who,
directly or indirectly, through any contract, arrangement, understanding,
relationship or otherwise has or shares (i) voting power, which includes the
power to vote, or to direct the voting of such share; (ii) investment power,
which includes the power to direct the sale or other disposition of such share;
(iii) the right to receive or retain the proceeds of any sale or other
disposition of such share; or (iv) the right to receive distributions,
including cash dividends, in respect to such share.
(b) In the absence of proof to the contrary provided in accordance
with the procedures referred to in subparagraph (4) of this paragraph C, a
change in beneficial ownership shall be deemed to have occurred whenever a
share of stock is transferred of record into the name of any other person.
(c) In the case of a share of Common Stock or Voting Preferred
Stock held of record in the name of a corporation, general partnership, limited
partnership, voting trustee, bank, trust company, broker, nominee or clearing
agency, or in any other name except a natural person, if it has not been
established pursuant to the procedures referred to in subparagraph (4) that
such share was beneficially owned continuously since May 30, 1987 by the person
who possesses all of the attributes of beneficial ownership referred to in
clauses (i) through (iv) of subparagraph (2)(a) of this paragraph C with
respect to such share of Common Stock or Voting Preferred Stock, then such
share of Common Stock or Voting Preferred Stock shall carry with it only one
vote regardless of when record ownership of such share was acquired.
(d) In the case of a share of stock held of record in the name of
any person as trustee, agent, guardian or custodian under the Uniform Gifts to
Minors Act, the Uniform Transfers to Minors Act or any comparable statute as in
effect in any state, a change in beneficial ownership shall be deemed to have
occurred whenever there is a change in the beneficiary of such trust, the
principal of such agent, the ward of such guardian or the minor for whom such
custodian is acting.
(3) Notwithstanding anything in this paragraph C to the contrary, no
change in beneficial ownership shall be deemed to have occurred solely as a
result of:
(a) any event that occurred prior to May 30, 1987, including
contracts providing for options, rights of first refusal and similar
arrangements, in existence on such date to which any holder of shares of stock
is a party;
(b) any transfer of any interest in shares of stock pursuant to a
bequest or inheritance, by operation of law upon the death of any individual,
or by any other transfer without valuable consideration, including a gift that
is made in good faith and not for the purpose of circumventing this paragraph
C;
(c) any change in the beneficiary of any trust, or any distribution
of a share of stock from trust, by reason of the birth, death, marriage or
divorce of any natural person, the adoption of any natural person prior to age
18 or the passage of a given period of time or the attainment by any natural
person of a specified age, or the creation or termination of any guardianship
or custodian arrangement; or
(d) any appointment of a successor trustee, agent, guardian or
custodian with respect to a share of stock.
(4) For purposes of this paragraph C, all determinations concerning
changes in beneficial ownership, or the absence of any such change, shall be
made by the Corporation. Written procedures designed to facilitate such
determinations shall be established by the Corporation and refined from time to
time. Such procedures shall provide, among other things, the manner of proof
of facts that will be accepted and the frequency with which such proof may be
required to be renewed. The Corporation and any transfer agent shall be
entitled to rely on all information concerning beneficial ownership of a share
of stock coming to their attention from any source and in any manner reasonably
deemed by them to be reliable, but neither the Corporation nor any transfer
agent shall be charged with any other knowledge concerning the beneficial
ownership of a share of stock.
(5) Each share of Common Stock acquired by reason of any stock split or
dividend shall be deemed to have been beneficially owned by the same person
continuously from the same date as that on which beneficial ownership of the
share of Common Stock, with respect to which such share of Common Stock was
distributed, was acquired.
(6) Each share of Common Stock acquired upon conversion of the
outstanding Series H Preferred Stock of the Corporation ("Convertible Stock")
shall be deemed to have been beneficially owned by the same person continuously
from the date on which such person acquired the Convertible Stock converted
into such share of Common Stock.
(7) Where a holder beneficially owns shares having ten votes per share
and shares having one vote per share, and transfers beneficial ownership of
less than all of the shares held, the shares transferred shall be deemed to
consist, in the absence of evidence to the contrary, of the shares having one
vote per share.
(8) Shares of Common Stock held by the Corporation's employee benefit
plans will be deemed to be beneficially owned by such plans regardless of how
such shares are allocated to or voted by participants, until the shares are
actually distributed to participants.
(9) Each share of Common Stock, whether at any particular time the holder
thereof is entitled to exercise ten votes or one, shall be identical to all
other shares of Common Stock in all other respects.
(10) Each share of Voting Preferred Stock, whether at any particular time
the holder thereof is entitled to exercise ten votes or one, shall be identical
in all other respects to all other shares of Voting Preferred Stock in the same
designated series.
(11) Each share of Common Stock issued by the Corporation in a business
combination transaction shall be deemed to have been beneficially owned by the
person who received such share in the transaction continuously for the shortest
period, as determined in good faith by the Board of Directors, that would be
permitted for the transaction to be accounted for as a pooling of interests,
provided that the Audit Committee of the Board of Directors has made a good
faith determination that (a) such transaction has a bona fide business purpose,
(b) it is in the best interests of the Corporation and its shareholders that
such transaction be accounted for as a pooling of interests under generally
accepted accounting principals and (c) such issuance of Common Stock does not
have the effect of nullifying or materially restricting or disparately reducing
the per share voting rights of holders of an outstanding class or classes of
voting stock of the Corporation. Notwithstanding the foregoing, (i) the
Corporation shall not issue shares in a business combination transaction if
such issuance would result in a violation of any rule or regulation regarding
the per share voting rights of publicly-traded securities that is promulgated
by the Securities and Exchange Commission or the principal exchange upon which
the Common Stock is then listed for trading and (ii) nothing herein shall be
interpreted to require the Corporation to account for any business combination
transaction in any particular manner.
<PAGE>
CENTURY TELEPHONE ENTERPRISES, INC.
100 CENTURY PARK DRIVE
MONROE, LOUISIANA 71203
(318) 388-9500
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PROXY STATEMENT
-----------------
March 19, 1998
This proxy statement is furnished in connection with the solicitation
of proxies on behalf of the Board of Directors (the "Board") of Century
Telephone Enterprises, Inc. (the "Company") for use at its annual meeting
of shareholders to be held at the time and place set forth in the
accompanying notice, and at any adjournments thereof (the "Meeting"). This
proxy statement is first being mailed to shareholders of the Company on or
about March 23, 1998.
As of March 9, 1998, the record date for determining shareholders
entitled to notice of and to vote at the Meeting (the "Record Date"), the
Company had outstanding 61,019,291 shares of common stock (the "Common
Stock") and 324,238 shares of Series H and L voting preferred stock that
vote together with the Common Stock as a single class on all matters
("Voting Preferred Stock" and, collectively with the Common Stock, "Voting
Shares"). The Company's Articles of Incorporation (the "Articles")
generally provide that holders of Voting Shares that have been beneficially
owned continuously since May 30, 1987 are entitled to cast ten votes per
share, subject to compliance with certain procedures. Article III of the
Articles and the voting procedures adopted thereunder contain several
provisions governing the voting power of the Voting Shares, including a
presumption that each Voting Share held by nominees or by any holder other
than a natural person or estate entitles such holder to only one vote,
unless the record holder thereof furnishes the Company with evidence to the
contrary. Applying the presumptions described in Article III, the
Company's records indicate that 120,175,269 votes are entitled to be cast
at the Meeting, of which 119,803,889 (99.7%) are attributable to the Common
Stock. All percentages of voting power set forth in this proxy statement
have been calculated based on such number of votes.
On or about March 31, 1998, the Company will effect a three-for-two
stock split through the payment of a 50% stock dividend to each holder of
record of Common Stock as of March 10, 1998. Because the number of votes
that each shareholder will be entitled to cast at the Meeting will be based
on share ownership as of March 9, 1998, the stock split will not affect
your voting power. ACCORDINGLY, ALL INFORMATION PRESENTED IN THIS PROXY
STATEMENT RELATING TO SHARE OWNERSHIP, VOTING POWER, SHARES SUBJECT TO
OPTIONS AND OPTION EXERCISE PRICES HAS BEEN SET FORTH WITHOUT GIVING EFFECT
TO THE STOCK SPLIT.
If a shareholder is a participant in the Company's Automatic Dividend
Reinvestment and Stock Purchase Service, the Company's proxy card covers
shares credited to the shareholder's account under that plan, as well as
shares registered in the participant's name. However, the proxy card will
not serve as a voting instruction card for shares held for participants in
the Company's Stock Bonus Plan and PAYSOP, Employee Stock Ownership Plan,
Dollars & Sense Plan or Retirement Savings Plan for Bargaining Unit
Employees. Instead, these participants will receive from the plan trustees
separate voting instruction cards covering these shares. These voting
instruction cards should be completed and returned in the manner provided
in the instructions that accompany such cards.
The Company will pay all expenses of soliciting proxies for the
Meeting. Proxies may be solicited personally, by mail, by telephone or by
facsimile by the Company's directors, officers and employees, who will not
be additionally compensated therefor. The Company will also request
persons holding Voting Shares in their names for others, such as brokers,
banks and other nominees, to forward proxy materials to their principals
and request authority for the execution of proxies, for which the Company
will reimburse them for expenses incurred in connection therewith. The
Company has retained The Altman Group, Inc. to assist in the solicitation
of proxies from brokers, banks, nominees and individuals, for which it will
be paid a fee of $5,000 and will be reimbursed for certain out-of-pocket
expenses.
ELECTION OF DIRECTORS
The Articles authorize a board of directors of 14 members divided into
three classes. Members of the respective classes hold office for staggered
terms of three years, with one class elected at each annual shareholders'
meeting. Five Class I directors will be elected at the Meeting. Unless
authority is withheld, all votes attributable to the shares represented by
each duly executed and delivered proxy will be cast for the election of
each of the five below-named nominees, each of whom has been recommended
for election by the Board's Nominating Committee. Because no shareholder
has timely nominated any individuals to stand for election at the Meeting
in accordance with the Company's director nomination bylaw (which is
described generally under the heading "Other Matters - Shareholder
Nominations and Proposals"), the five below-named nominees will be the only
individuals that may be elected at the Meeting. If for any reason any
proposed nominee should decline or become unable to stand for election as a
director, which is not anticipated, votes will be cast instead for another
candidate designated by the Board, without resoliciting proxies.
The following provides certain information with respect to each
proposed nominee and each other director whose term will continue after the
Meeting, including his or her beneficial ownership of shares of Common
Stock determined in accordance with Rule 13d-3 of the Securities and
Exchange Commission ("SEC"). Unless otherwise indicated, (i) all
information is as of the Record Date, (ii) each person has been engaged in
the principal occupation shown for more than the past five years and (iii)
shares beneficially owned are held with sole voting and investment power.
None of the persons named below beneficially owns more than 1% of the
outstanding shares of Common Stock or is entitled to cast more than 1% of
the total voting power.
<PAGE>
- - -----------------------------------------------------------------------------
CLASS I DIRECTORS (TERM EXPIRES IN 2001):
- - -----------------------------------------------------------------------------
[Photo of Mr. Boles Omitted]
WILLIAM R. BOLES, JR., age 41; a director since 1992; an executive
officer, director and practicing attorney with Boles, Boles & Ryan, a
professional law corporation.
Committee Memberships: Insurance Evaluation (Chairman); Shareholder
Relations
Shares Beneficially Owned: 2,125
- - -----------------------------------------------------------------------------
[Photo of Mr. Hanks Omitted]
W. BRUCE HANKS, age 43; a director since 1992; Senior Vice President-
Corporate Development and Strategy of the Company since October 1996;
President-Telecommunications Services of the Company (or a comparable
predecessor position) between July 1989 and October 1996.
Committee Memberships: Insurance Evaluation
Shares Beneficially Owned: 199,763(1)
- - -----------------------------------------------------------------------------
[Photo of Mr. Melville Omitted]
C. G. MELVILLE, JR., age 57; a director since 1968; private investor
since 1992; retired executive officer of an equipment distributor.
Committee Memberships: Audit; Insurance Evaluation; Nominating
Shares Beneficially Owned: 11,334
- - -----------------------------------------------------------------------------
[Photo of Mr. Post Omitted]
GLEN F. POST, III, age 45; a director since 1985; Vice Chairman of the
Board, President and Chief Executive Officer of the Company.
Committee Membership: Executive
Shares Beneficially Owned: 428,367(1)
- - -----------------------------------------------------------------------------
[Photo of Mr. Williams Omitted]
CLARKE M. WILLIAMS, age 76; a director since 1968; Chairman of the
Board. Mr. Williams, who is the father-in-law of Harvey P. Perry,
founded the Company's telephone business in 1946.
Committee Membership: Executive (Chairman)
Shares Beneficially Owned: 551,936(1)
- - -----------------------------------------------------------------------------
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE FOR EACH OF THESE PROPOSED
NOMINEES.
- - -----------------------------------------------------------------------------
CLASS II DIRECTORS (TERM EXPIRES IN 1999):
- - -----------------------------------------------------------------------------
[Photo of Ms. Boulet Omitted]
VIRGINIA BOULET, age 44; a director since January 1995; Partner,
Phelps Dunbar, L.L.P., a law firm.
Committee Memberships: Audit; Shareholder Relations
Shares Beneficially Owned: 2,037(2)
- - -----------------------------------------------------------------------------
[Photo of Mr. Butler Omitted]
ERNEST BUTLER, JR., age 69; a director since 1971; President of I. E.
Butler Securities, Inc., an investment banking firm, since February 1,
1998; for over 30 years prior to such time, served as an executive
officer of Stephens Inc., an investment banking firm.
Committee Memberships: Audit; Compensation (Chairman);
Shareholder Relations
Shares Beneficially Owned: 337
- - -----------------------------------------------------------------------------
[Photo of Mr. Gardner Omitted]
JAMES B. GARDNER, age 63; a director since 1981; Managing Director of
a division of Service Asset Management Company, a financial services
firm, and business consultant; President and Chief Executive Officer,
Pacific Southwest Bank, F.S.B. from November 1991 to April 1994; for
several years prior to November 1991, served as an executive officer
of various banks or other financial service companies.
Committee Memberships: Executive; Audit; Compensation
Shares Beneficially Owned: 1,012
- - -----------------------------------------------------------------------------
[Photo of Mr. Hargrove Omitted]
R. L. HARGROVE, JR., age 66; a director since 1985; retired as
Executive Vice President of the Company in 1987 after 12 years of
service as an officer; has acted since 1987 as a part-time consultant
to local businesses and individuals regarding financial and tax
matters.
Committee Memberships: Executive; Audit; Shareholder Relations
(Chairman)
Shares Beneficially Owned: 29,987
- - -----------------------------------------------------------------------------
[Photo of Mr. Hebert Omitted]
JOHNNY HEBERT, age 69; a director since 1968; President of Valley
Electric, an electrical contractor.
Committee Memberships: Audit; Nominating (Chairman); Insurance
Evaluation
Shares Beneficially Owned: 3,247(3)
- - -----------------------------------------------------------------------------
CLASS III DIRECTORS (FOR TERM EXPIRING IN 2000):
- - -----------------------------------------------------------------------------
[Photo of Mr. Czeschin Omitted]
CALVIN CZESCHIN, age 62; a director since 1975; President and Chief
Executive Officer of Yelcot Telephone Company, Czeschin Motors and
ComputerMart, Inc.
Committee Memberships: Executive; Audit (Chairman); Shareholder
Relations
Shares Beneficially Owned: 187,164(4)
- - -----------------------------------------------------------------------------
[Photo of Mr. Hogan Omitted]
F. EARL HOGAN, age 76; a director since 1968; managing partner of EDJ
Farms Partnership, a farming enterprise, for several years prior to
his retirement in December, 1997.
Committee Memberships: Executive; Audit; Compensation
Shares Beneficially Owned: 18,173
- - -----------------------------------------------------------------------------
[Photo of Mr. Perry Omitted]
HARVEY P. PERRY, age 53; a director since 1990; Senior Vice President,
General Counsel and Secretary of the Company. Mr. Perry is the son-
in-law of Clarke M. Williams.
Committee Membership: Executive
Shares Beneficially Owned: 218,546
- - -----------------------------------------------------------------------------
[Photo of Mr. Reppond Omitted]
JIM D. REPPOND, age 56; a director since 1986; retired; Vice
President-Telephone Group of the Company from January 1995 to July
1996; President-Telephone Group of the Company (or a comparable
predecessor position) from May 1987 to December 1994.
Committee Memberships: Executive; Insurance Evaluation
Shares Beneficially Owned: 28,410
- - -----------------------------------------------------------------------------
(1) Includes (i) shares of time-vested and performance-based restricted stock
issued to the below-named officers under the Company's incentive
compensation plans ("Restricted Stock"), with respect to which such
officers have sole voting power but no investment power; (ii) shares
("Option Shares") that such officers have the right to acquire within 60
days of the Record Date pursuant to options granted under the Company's
incentive compensation plans; and (iii) shares (collectively, "Plan
Shares") allocated to such officers' accounts as of December 31, 1997
under the Company's Stock Bonus Plan and PAYSOP and Employee Stock
Ownership Plan ("ESOP"), and as of the Record Date under the Company's
Dollars & Sense Plan ("401(k) Plan"), with respect to which such officers
have sole voting power but no investment power, as follows:
Restricted
Name Stock Option Shares Plan Shares
- - ---------------------- ---------- ------------- -----------
W. Bruce Hanks 6,854 166,410 22,312
Glen F. Post, III 14,342 350,645 32,108
Clarke M. Williams 16,578 498,336 6,222
Harvey P. Perry 6,705 161,436 15,661
(2) Includes 434 shares held by Ms. Boulet as custodian for the benefit of her
children.
(3) Includes 757 shares owned by Mr. Hebert's wife, as to which he disclaims
beneficial ownership.
(4) Includes 5,332 shares owned by Mr. Czeschin's wife, as to which he
disclaims beneficial ownership.
(5) Includes 95 shares owned by Mr. Perry's wife, as to which he disclaims
beneficial ownership, and 1,215 shares held as custodian for the benefit
of his children.
-------------------
<PAGE>
MEETINGS AND CERTAIN COMMITTEES OF THE BOARD
During 1997 the Board held four regular meetings and nine special
meetings.
The Board's Executive Committee, which met twice during 1997, is
authorized to exercise all the powers of the Board to the extent permitted by
law.
The Board's Audit Committee meets with the Company's independent and
internal auditors and the Company's personnel responsible for preparing its
financial reports and is responsible for reviewing the scope and results of the
auditors' examination of the Company, discussing with the auditors the scope,
reasonableness and adequacy of internal accounting controls, considering and
recommending to the Board a certified public accounting firm for selection as
the Company's independent auditors, and directing and supervising any special
investigations as instructed by the Board. The Audit Committee held three
meetings during 1997.
The Board's Nominating Committee, which held two meetings in 1997, is
responsible for recommending to the Board both a proposed slate of nominees for
election as directors and the individuals proposed for appointment as officers.
Any shareholder who wishes to make a nomination for the election of directors
must do so in compliance with the procedures set forth in the Company's bylaws,
which are discussed further under the heading "Other Matters - Shareholder
Nominations and Proposals."
The Board's Compensation Committee held four meetings during 1997. The
Compensation Committee's Incentive Awards Subcommittee also held four meetings
during 1997. Both the Committee and the Subcommittee are described further
below.
DIRECTOR COMPENSATION
Each director who is not an employee of the Company is paid an annual fee
of $25,000 plus $1,500 for attending each regular Board meeting, $2,000 for
attending each special Board meeting and $1,000 for attending each meeting of a
Board committee. The Company is currently considering a proposal to pay
additional amounts to Board committee chairmen. The Company permits such
directors to defer all or a portion of their fees until the date designated by
the director or the occurrence of certain specified events. Amounts so
deferred earn interest equal to the one-year Treasury bill rate. Each director
is also reimbursed for expenses incurred in attending meetings.
Under the Company's Outside Directors' Retirement Plan, non-employee
directors ("outside directors") who have completed five years of Board service
are entitled to receive, upon normal retirement at age 70, monthly payments
that on a per annum basis equal the director's annual rate of compensation for
Board service at retirement plus the fee payable for attending one special
board meeting. Outside directors who have completed ten years of service can
also receive these payments upon early retirement at age 65, subject to certain
benefit reductions. In addition, this plan provides certain disability and
preretirement death benefits. The Company has established a trust to fund its
obligations under this plan, but participants' rights to these trust assets are
no greater than the rights of unsecured creditors. Outside directors whose
service is terminated in connection with a change in control of the Company (as
defined below) are entitled to receive a cash payment equal to the present
value of their vested plan benefits, determined in accordance with the
actuarial assumptions specified in the plan.
VOTING SHARE OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information regarding ownership of the
Company's Common Stock by (i) each person known to the Company to be the
beneficial owner of more than 5% of the outstanding Common Stock and (ii)
all of the Company's directors and executive officers as a group. The
table also sets forth similar information for one of the executive officers
listed in the Summary Compensation Table set forth elsewhere herein;
similar information for each other executive officer listed in such table
is included under the heading "Election of Directors." Unless otherwise
indicated, all information is presented as of the Record Date and all
shares indicated as beneficially owned are held with sole voting and
investment power.
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF PERCENT
NAME AND ADDRESS OWNERSHIP OF OUTSTANDING OF VOTING
OF BENEFICIAL OWNER COMMON STOCK(1) COMMON STOCK(1) POWER(2)
- - ------------------------ --------------- --------------- ---------
Principal Shareholder:
Regions Bank, as Trustee 5,045,586(3) 8.3% 32.4%
(the "Trustee") of the
Stock Bonus Plan and
ESOP (the "Benefit Plans")
P. O. Box 7232
Monroe, Louisiana 71211
Management:
R. Stewart Ewing, Jr. 189,484(4) * *
All directors and executive 2,083,896(5) 3.3% 3.0%
officers as a group (17 persons)
- - -----------------------------------
* Represents less than 1%.
(1) Determined in accordance with Rule 13d-3 of the SEC based upon information
furnished by the persons listed. In addition to Common Stock, the Company
has outstanding Series H and L Voting Preferred Stock that vote together
with the Common Stock as a single class on all matters. Although one or
more persons beneficially own in excess of 5% of each of these series of
Voting Preferred Stock, the percentage of voting power held by these
persons is immaterial. For additional information regarding the Voting
Preferred Stock, see page 1 of this proxy statement.
(2) Based on the Company's records and, with respect to all shares held of
record by the Trustee, based on information the Trustee periodically
provides to the Company to establish that certain of these shares entitle
the Trustee to cast ten votes per share.
(3) All voting power attributable to these shares is directed by the
participants of the Benefit Plans, each of whom is deemed, subject to
certain limited exceptions, to tender such instructions as a "named
fiduciary" under such plans, which requires the participants to direct
their votes in a manner that they believe to be prudent and in the best
interests of the participants of each respective plan.
(4) Includes 6,699 shares of Restricted Stock, 154,803 Option Shares that Mr.
Ewing has the right to acquire within 60 days of the Record Date and
15,704 Plan Shares allocated to his account as of December 31, 1997 under
the Benefit Plans and as of the Record Date under the 401(k) Plan.
(5) Includes (i) 60,953 shares of Restricted Stock, (ii) 1,495,461 Option
Shares that such persons have the right to acquire within 60 days of the
Record Date, (iii) 118,537 Plan Shares allocated to their respective
accounts as of December 31, 1997 under the Benefit Plans and as of the
Record Date under the 401(k) Plan, (iv) 16,048 shares held of record by
the spouses of certain directors and executive officers, as to which
beneficial ownership is disclaimed, and (v) 1,713 shares held as custodian
for the benefit of the children of the directors and executive officers.
<PAGE>
EXECUTIVE COMPENSATION AND RELATED INFORMATION
SUMMARY OF COMPENSATION
The following table sets forth certain information regarding the
compensation of (i) the Company's Chief Executive Officer and (ii) each of
the Company's four most highly compensated executive officers other than
the Chief Executive Officer (collectively, the "named officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term
Compensation Awards
----------------------------------------
Long-
No. of Term
Annual Compensation Restricted Securities Incentive
Name and Current ------------------------ Stock Underlying Plan All Other
Prinicipal Position Year Salary Bonus(1) Awards(1) Options Payouts(2) Compensation(3)
- - ------------------------ ---- -------- ---------- ---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Clarke M. Williams 1997 $535,854 $1,011,430 $102,477 87,993 $ 59,220 $98,619
Chairman of the Board 1996 494,003 108,187 72,137 0 0 83,387
1995 470,864 107,357 71,584 126,336 0 81,295
Glen F. Post, III 1997 479,397 904,865 91,690 87,993 43,875 81,273
Vice Chairman of the 1996 435,176 95,303 63,550 0 0 56,214
Board, President and 1995 383,969 87,545 58,354 126,336 0 52,081
Chief Executive Officer
W. Bruce Hanks 1997 261,207 475,084 31,247 26,496 32,552 49,361
Senior Vice President- 1996 240,564 52,684 35,123 0 0 33,297
Corporate Development 1995 228,975 72,581 34,796 36,552 0 34,842
and Strategy
Harvey P. Perry 1997 254,600 462,888 30,426 26,496 32,906 48,677
Senior Vice President, 1996 234,490 51,353 34,224 0 0 32,372
Secretary and General 1995 223,201 50,890 33,919 36,552 0 32,410
Counsel
R. Stewart Ewing, Jr. 1997 254,298 455,753 30,368 26,496 32,704 47,801
Senior Vice President 1996 234,199 51,290 34,193 0 0 31,940
and Chief Financial 1995 222,918 50,825 33,885 36,552 0 32,021
Officer
</TABLE>
- - ----------------------
(1) The "Bonus" column reflects, for each year indicated, annual incentive
bonuses granted pursuant to the Company's annual incentive programs and,
for 1997 only, special cash bonuses for extraordinary services during 1997
in the following amounts: Mr. Williams, $761,666; Mr. Post, $681,415; Mr.
Hanks, $371,284; Mr. Perry, $361,885; and Mr. Ewing, $361,463. (These
amounts reflect 100% of the special bonuses paid to each of Messrs.
Williams and Post, which were distributed in two installments in late 1997
and early 1998 in order to maximize the tax deductibility of these
payments.) For additional information regarding the annual and special
bonuses, see "- Report of Compensation Committee Regarding Executive
Compensation--Bonuses."
For each year indicated above, the Company has awarded a portion of the
officers' annual incentive bonuses in the form of restricted stock that
vests generally upon the passage of time provided the officer remains
employed by the Company and, in 1997, the Company awarded a portion of the
officers' long-term incentive compensation in the form of additional
shares of restricted stock that vest based upon the passage of time
(collectively, the "Time-Vested Restricted Shares"). The "Restricted
Stock Awards" column above reflects, for each year indicated, the value of
Time-Vested Restricted Shares awarded, determined as of the award date.
In addition, as part of the long-term incentive compensation granted to
the Company's officers in 1997, each officer named above received
performance-based restricted shares (the "Performance-Based Restricted
Shares") that will vest based on the performance of the Company's stock in
relation to that of certain specified peer group companies, all as
described further below under "- 1997 Long-Term Incentive Awards." The
chart below sets forth additional information as of December 31, 1997
regarding the named officers' aggregate holdings of all Time-Vested
Restricted Shares and Performance-Based Restricted Shares and the
aggregate value thereof, determined as if all such restricted shares were
fully vested. (This chart does not reflect Time-Vested Restricted Shares
granted in February 1998 as incentive bonuses for the Company's 1997
performance nor unearned performance shares granted in 1997 and 1998 with
respect to which shares of Common Stock have not been issued.)
<TABLE>
<CAPTION>
Performance- Aggregate
Time-Vested Based Value at
Restricted Restricted December 31,
Name Shares Shares Total 1997
- - ------------------ ----------- ------------ -------- ------------
<S> <C> <C> <C> <C>
Mr. Williams 14,362 1,615 15,977 $ 795,854
Mr. Post 11,575 1,615 13,190 657,027
Mr. Hanks 6,717 486 7,203 358,799
Mr. Perry 6,516 486 7,002 348,787
Mr. Ewing 6,510 486 6,996 348,488
</TABLE>
Dividends are paid currently with respect to all shares described above.
For additional information regarding the foregoing, see "- Report of
Compensation Committee Regarding Executive Compensation."
(2) Reflects the value of Common Stock issued as a result of performance units
awarded in 1993 being earned during 1997 based on the appreciation in the
market value of the Common Stock since 1993. See "- Report of
Compensation Committee Regarding Executive Compensation--Stock Incentive
Programs---Stock Retention Program."
(3) Comprised of the Company's (i) matching contributions to the 401(k) Plan,
as supplemented by matching contributions under the Company's Supplemental
Dollars & Sense Plan, (ii) premium payments under a medical reimbursement
plan that are attributable to benefits in excess of those provided
generally for other employees, (iii) premium payments for life insurance
policies providing death benefits to the executive officers' beneficiaries
(and no other benefit to such officers), and (iv) contributions pursuant
to the Stock Bonus Plan and ESOP valued as of December 31, 1997 (as
supplemented by contributions under the Company's Supplemental Defined
Contribution Plan), in each case for and on behalf of the named executive
officers as follows:
<TABLE>
<CAPTION>
Medical Life Stock Bonus Plan and
401(k) Plan Plan Insurance ESOP
Name Year Contributions Premiums Premiums Contributions
- - ---------------------- ----- ------------- ---------- ---------- ---------------------
<S> <C> <C> <C> <C> <C>
Mr. Williams 1997 $ 0 $ 1,454 $ 39,439 $ 57,726
1996 0 1,344 38,887 43,156
1995 0 1,344 37,065 42,886
Mr. Post 1997 26,953 1,454 1,222 51,644
1996 15,895 1,344 958 38,017
1995 14,982 1,344 783 34,972
Mr. Hanks 1997 21,606 1,454 546 25,755
1996 10,439 1,344 498 21,016
1995 10,855 1,344 443 22,200
Mr. Perry 1997 21,062 1,454 1,069 25,092
1996 9,579 1,344 964 20,485
1995 9,883 1,344 854 20,329
Mr. Ewing 1997 21,035 1,454 678 24,634
1996 9,567 1,344 569 20,460
1995 9,870 1,344 504 20,303
</TABLE>
-------------------
<PAGE>
1997 OPTION GRANTS
The following table sets forth certain information concerning
nonqualified stock options granted in 1997 by the Incentive Award
Subcommittee.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants
-----------------------------------------------------------
Number of % of Total Potential Realizable Value of Options
Securities Options at Assumed Annual Rates of
Underlying Granted to Stock Price Appreciation Over
Options Employees in Exercise Expiration Ten-Year Option Term
Name Granted(1) 1997 Price(2) Date (5%) (10%)
---- ------------- ------------ -------- ---------- --------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Clarke M. Williams 87,993 19% $30.375 2/24/07 $1,680,902 $4,259,735
Glen F. Post, III 87,993 19 30.375 2/24/07 1,680,902 4,259,735
W. Bruce Hanks 26,496 6 30.375 2/24/07 506,144 1,282,669
Harvey P. Perry 26,496 6 30.375 2/24/07 506,144 1,282,669
R. Stewart Ewing, Jr. 26,496 6 30.375 2/24/07 506,144 1,282,669
All Shareholders(3) 61,019,291 -- 30.375 2/24/07 1,165,631,641 2,953,939,437
</TABLE>
(1) As part of a three-year option program covering 1997, 1998 and 1999, one-
third of these options were exercisable immediately, one-third became
exercisable on February 24, 1998, and one-third will become exercisable on
February 24, 1999.
(2) Does not reflect the effects of the Company's 50% stock dividend payable
March 31, 1998. See page 1.
(3) The amounts shown as potential realizable value for all shareholders,
which are presented for comparison purposes only, represent the aggregate
net gain for all holders of record, as of March 9, 1998, of the Common
Stock assuming a hypothetical option to acquire 61,019,291 shares of
Common Stock (the number of such shares outstanding as of the Record Date)
granted at $30.375 per share (the weighted average price of all options
granted in 1997) on February 24, 1997 and expiring on February 24, 2007,
if the price of Common Stock appreciates at the rates shown in the table.
There can be no assurance that the potential realizable values shown in
the table will be achieved. The Company neither makes nor endorses any
prediction as to future stock performance.
OPTION EXERCISES AND HOLDINGS
The following table sets forth certain information concerning the
exercise of options during 1997 and unexercised options held at December 31,
1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
No. of Number of Securities Value of Unexercised
Shares Underlying Unexercised in-the-Money Options at
Acquired Options at December 31, 1997 December 31, 1997
on Value ------------------------------- -----------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- - ------------------------ ------------ ------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Clarke M. Williams 14,699 $ 446,015 469,005 58,662 $10,489,350 $1,140,243
Glen F. Post, III 36,085 1,233,434 321,314 58,662 6,467,956 1,140,243
W. Bruce Hanks 0 0 157,578 17,664 3,501,926 343,344
Harvey P. Perry 16,125 529,575 152,604 17,664 3,361,946 343,344
R. Stewart Ewing, Jr. 0 0 145,971 17,664 3,175,276 343,344
</TABLE>
1997 LONG-TERM INCENTIVE AWARDS
In February 1997, the Company granted performance-based restricted shares
and performance shares (collectively, "Performance-Based Incentive Shares"),
which constituted a portion of the long-term incentive compensation award
granted to each of the Company's officers. See "- Report of Compensation
Committee Regarding Executive Compensation--Stock Incentive Programs."
The performance-based restricted shares will vest, and the performance
shares will be earned, as of December 31, 2001 based on the Company's total
shareholder return in relation to the total shareholder return of the group of
peer companies selected by the Company for purposes of comparing its market
performance against other companies as required by the federal proxy rules
(the "peer companies"). For purposes of these calculations, total shareholder
return means the increase in the stock price of the applicable company plus
reinvestment of dividends for the five year period from January 1, 1997
through December 31, 2001 ("shareholder return"). Under the terms of the
Performance-Based Incentive Shares, the number of such shares that will vest
or be earned at the end of the five-year period will depend on how the
Company's shareholder return compares to the average shareholder return of
those companies comprising the top, middle and lower tiers of the peer
companies (divided into equal thirds as nearly as possible).
If the Company's shareholder return is less than the average shareholder
return of the lower third of the peer companies, no Performance-Based
Incentive Shares will vest or be earned. If the Company's shareholder return
equals or exceeds the average shareholder return of the lower third of the
peer companies, then up to 100% of the performance-based restricted shares
will vest depending upon how favorably the Company's shareholder return
compares to the average shareholder return of the middle third of the peer
companies. In addition, if the Company's shareholder return exceeds the
average shareholder return of the middle third of the peer companies, then up
to 100% of the performance shares will be earned depending upon how favorably
the Company's shareholder return compares to the average shareholder return of
the top third of the peer companies. If the Company's shareholder return
exceeds the average shareholder return of the top third of the peer companies,
then all of the Performance-Based Incentive Shares will vest and be earned.
If an officer's employment is terminated before December 31, 2001, such
officer will receive the pro rata portion of his Performance-Based Incentive
Shares based upon the number of full years that have elapsed and the Company's
shareholder return in comparison to the peer companies.
The following table sets forth additional information about the
Performance-Based Incentive Shares granted on February 24, 1997 to the named
officers:
LONG-TERM INCENTIVE
AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Performance or
Number of Number of Other Period Until
Performance-Based Performance Maturation or
Name Restricted Shares Shares Payout
- - ---------------------- ----------------- ------------ -----------------
<S> <C> <C> <C>
Clarke M. Williams 1615 1616 December 31, 2001
Glen F. Post, III 1615 1616 December 31, 2001
W. Bruce Hanks 486 487 December 31, 2001
Harvey P. Perry 486 487 December 31, 2001
R. Stewart Ewing 486 487 December 31, 2001
</TABLE>
REPORT OF COMPENSATION COMMITTEE REGARDING EXECUTIVE COMPENSATION
GENERAL. The Board's Compensation Committee, either directly or
through its Incentive Awards Subcommittee, monitors and establishes the
compensation levels of the Company's executive officers and directors,
administers the Company's incentive compensation programs, and performs
other related tasks. The Committee is composed entirely of Board members
who are not employees of the Company and the Subcommittee is composed
entirely of Committee members who qualify as "outside directors" under
Section 162(m) of the Internal Revenue Code of 1986 and as "non-employee
directors" under Rule 16b-3 promulgated under the Securities Exchange Act
of 1934.
Compensation Objectives. During 1997, the Committee applied the
following compensation objectives in connection with its deliberations:
* compensating the Company's executive officers with salaries
commensurate with the median salaries of similarly-situated
executives at comparable companies
* providing a substantial portion of the executives'
compensation in the form of incentive compensation based upon (i)
the Company's annual, intermediate and long-term performance and
(ii) the individual, departmental or divisional achievements of
the executives
* encouraging team orientation
* providing sufficient benefit levels for executives and their
families in the event of disability, illness or retirement
In addition, to the extent that it is practicable and consistent with
the Company's executive compensation objectives, the Committee intends to
comply with Section 162(m) of the Internal Revenue Code of 1986 and any
regulations promulgated thereunder (collectively, "Section 162(m)") in
order to preserve the deductibility of performance-based compensation in
excess of $1 million per taxable year to each of the named officers. If
compliance with Section 162(m) conflicts with the Committee's compensation
objectives or is deemed not to be in the best interests of shareholders,
the Committee reserves the right to pursue its objectives, regardless of
the tax implications of such actions.
Overview of 1997 Compensation. During 1997, the Company's executive
compensation was comprised of (i) salary, (ii) annual and special bonuses,
(iii) grants of long-term incentive compensation in the form of stock
options, restricted stock (performance-based and time vested) and
performance shares and (iv) other benefits typically provided to executives
of comparable companies, all as described further below. For each such
component of compensation, the Company's compensation levels were compared
with those of comparable companies.
During 1997, the Committee retained an independent consulting firm to
review the Company's officer compensation programs. In connection with
this review, the consulting firm compared the Company's officer
compensation practices to that of a national group of several hundred
companies. This group consisted of a substantial number of
telecommunications companies (including several of the peer companies
referred to in the Company's stock performance graph appearing elsewhere
herein), but also included several hundred other companies (excluding
financial service companies) that have revenue levels similar to the
Company's.
SALARY. The salary of the Chief Executive Officer and each other
executive officer is based primarily on the officer's level of
responsibility and comparisons to prevailing salary levels for similar
officers at comparable companies. During 1997, the Committee's independent
consulting firm surveyed the compensation practices of Century and
comparable companies, and concluded that all of the named officers were
receiving salaries within the salary ranges for comparable officers at
comparable companies. Based principally upon the Committee's review of
this report and generally prevailing rates of salary increases, the
Committee increased the salary of each named officer 4.5% in May 1997. The
Committee believes these raises were consistent with its objectives of (i)
ensuring that the executive officers receive salaries comparable to those
of similarly-situated executives and (ii) applying a team orientation to
executive compensation.
The Chairman's compensation is determined in the same manner as the
compensation for all other executive officers, provided that his annual
salary cannot be reduced below the minimum salary to which he is entitled
under his 1993 employment agreement described below under the heading "-
Employment Contract With Chairman and Change-in-Control Arrangements."
BONUSES. As described further below, the Committee modified the
Company's annual incentive bonus programs in 1997 to increase potential
benefits to market levels and to base bonuses partially upon individual
achievement. For the reasons described below, the Committee also elected
to pay special bonuses for extraordinary services during 1997.
Annual Incentive Bonus Programs. The Company maintains (i) a
shareholder-approved short-term incentive program for its Chairman and its
Chief Executive Officer and (ii) an annual incentive bonus program for the
Company's other officers and managers. In connection with both of these
bonus programs, the Compensation Committee annually establishes target
performance levels and the amount of bonus payable if these targets are
met, which typically is defined in terms of a percentage of each officer's
salary. Historically, all of the bonuses payable under these programs have
been based solely upon the Company's overall financial performance measured
in terms of return on equity and, to a lesser extent, revenue growth.
During 1997, however, the Committee determined that it was more appropriate
to base a portion of the bonuses upon the individual, departmental or
divisional achievements of each executive officer other than the Chairman
and the President, each of whom will continue to receive annual bonuses
based solely upon the Company's overall financial performance.
In early 1997 the Committee recommended and the Company's shareholders
approved awarding each of the Chairman and the Chief Executive Officer an
incentive bonus for 1997 of 55% of their annual salaries if the Committee's
1997 targets were attained, a bonus of up to 110% of salary if the
Committee's 1997 targets were substantially exceeded or no bonus if certain
minimum target performance levels were not attained. For all other named
officers, the Committee recommended incentive bonuses for 1997 of 40% of
their annual salaries if the Committee's 1997 targets were attained, a
bonus of up to 80% of salary if the Committee's 1997 targets were
substantially exceeded or no bonus if certain minimum target performance
levels were not attained. Payment of over 60% of the target bonus awards
for each of these other named officers was based upon the Company's overall
financial performance. Payment of the remainder of the target awards for
these other officers was based upon the achievement of individual
performance objectives developed principally by the Company's President and
approved by the Committee.
As a result of the Company exceeding its 1997 target for return on
equity and nearly attaining its 1997 target for revenue growth, each of the
Chairman and the Chief Executive Officer received a bonus equal to 68.2% of
his 1997 salary. Based upon the Company's financial performance and the
attainment of individual performance objectives, each other named officer
received a bonus between 50.9% and 53.6% of his 1997 salary. The Incentive
Awards Subcommittee elected to pay the 1997 incentive bonuses principally
in cash, with the remainder being paid in the form of time-vested
restricted stock that may not be transferred by the officer for three years
and which, subject to certain exceptions, will be forfeited if prior to
that time the officer leaves the Company.
In determining the size of the executive officers' target bonuses, the
Compensation Committee has historically reviewed the most current, readily
available information furnished by its consultants and management as to the
bonus practices among comparable companies. During 1996 and 1997, the
Committee's independent consulting firm determined that the Company's
target bonuses for prior years, measured as a percentage of salary, were
substantially lower than those generally targeted by comparable companies,
many of whom have elected in recent years to place greater percentages of
total compensation at risk through short- and long-term incentive
compensation programs. The increases in target bonus opportunities
approved by the Committee in early 1997 were intended to eliminate the
shortfall between the Company's prior bonus levels and those targeted by
comparable companies.
Special Bonuses. In late 1997 and early 1998, the Incentive Awards
Subcommittee and the Board paid special bonuses to each full-time and part-
time employee of the Company in recognition of extraordinary services
associated with (i) the $179 million of aggregate pre-tax gains resulting
from the May 1997 sale of the Company's competitive access subsidiary in
exchange for publicly-traded stock and the November 1997 sale of
substantially all of such publicly-traded stock, and (ii) the Company's
acquisition of Pacific Telecom, Inc. ("PTI") in December 1997, including
extraordinary efforts to negotiate and finance the transaction on
attractive terms, to integrate PTI's operations into the Company's
operations, to timely obtain regulatory approvals, and to consummate the
transaction several months earlier than anticipated, the latter of which
resulted in a $20 million reduction in the purchase price. The acquisition
of PTI more than doubled the number of telephone access lines served by the
Company, and substantially increased its mobile communications operations.
The total amount of special bonuses payable to all employees for these
extraordinary services was approximately $6.5 million.
The amount of the special bonus paid to each executive officer was
based upon the officer's salary then in effect. In connection with
determining the size of these special bonuses payable to the executive
officers, the Incentive Awards Committee considered, among other things,
(i) the $179 million of aggregate pre-tax gains associated with the
Company's disposal of its competitive access subsidiary and the publicly-
traded stock obtained in connection therewith, (ii) the extraordinary
efforts required to consummate the purchase of PTI ahead of schedule and
the $20 million purchase price reduction resulting therefrom, (iii) the key
role performed by the executive officers in identifying and capturing the
benefits afforded by these transactions, (iv) the substantial appreciation
in the market price of the Company's Common Stock during 1997, and (v) the
importance of encouraging team orientation by allocating these bonuses
strictly in proportion to each executive officer's salary. To ensure that
substantially all of the special bonus payments will be deductible under
Section 162(m), payment of a portion of the bonuses payable to each of the
Chairman and the President was deferred until January 1998. For more
information, see "- Summary of Compensation."
STOCK INCENTIVE PROGRAMS. The Company's current incentive
compensation programs authorize the Compensation Committee or the Incentive
Awards Subcommittee to grant stock options and various other incentives to
key personnel. The Committee and Subcommittee's philosophy with respect to
stock incentive awards is to strengthen the relationship between
compensation and growth in the market price of the Common Stock and thereby
align the executive officers' financial interests with those of the
Company's shareholders.
Options granted under these programs become exercisable based upon
criteria established by the Compensation Committee or Incentive Awards
Subcommittee. The Subcommittee generally determines the size of option
grants based on information furnished by its consultants regarding stock
option practices among comparable companies and by creating greater
opportunities for stock ownership the greater the recipient's
responsibilities and duties. The Subcommittee also considers stock option
grants made by the Company in the past for overlapping performance periods.
1997 Grants. During 1997, the Subcommittee awarded to the Company's
officers long-term incentive compensation consisting of (i) stock options
on the terms outlined below under "- 1997 Option Grants," (ii) time-vested
restricted stock which will vest on the fifth anniversary of the grant date
if the officer remains employed by the Company on such date, subject to
earlier vesting upon death, disability, retirement or a change in control
of the Company, and (iii) performance-based restricted stock and
performance shares which will vest or be earned based on the performance of
the Company's Common Stock in relation to that of the Company's peer group
companies, as described above under "- 1997 Long-Term Incentive Awards."
The Subcommittee determined the size of the individual grants based on
information furnished by the Committee's independent consulting firm
relating to the long-term incentive compensation practices among other
comparable companies. Based on the consulting firm's recommendations, the
Subcommittee granted awards to each of the executive officers having a
value, determined under the Black-Scholes valuation methodology and
expressed as a percentage of annual salary, commensurate with long-term
incentive awards to comparable executives at other comparable companies
(after reducing the size of the 1997 option grants to reflect the fact that
the Subcommittee granted these awards one year earlier than originally
envisioned by the Committee in 1995, when it granted options intended to
serve as a three-year long-term incentive compensation program). The 1997
option grants are intended to serve as a three-year option program covering
1997, 1998 and 1999. On the other hand, the Committee's 1997 grants of
time-vested restricted stock and performance-based incentive shares are
intended to constitute long-term incentive compensation for 1997 only. The
Committee granted similar awards in 1998 and intends to grant additional
such awards in 1999.
Stock Retention Program. To provide an incentive for officers to
acquire and hold Common Stock, the Compensation Committee adopted a stock
retention program in 1993. Under this program, each executive officer who
voluntarily purchased a specified number of shares of Common Stock in 1993
was awarded (i) an equal number of shares of restricted stock, all of which
vested in 1996, and (ii) performance units entitling the officer to earn an
additional number of shares of Common Stock equal to 40% of the number of
shares purchased, all of which were earned during 1997, based on the
appreciation of the market price of the Common Stock since 1993.
OTHER BENEFITS. The Company maintains certain broad-based employee
benefit plans in which the executive officers are generally permitted to
participate on terms substantially similar to those relating to all other
participants, subject to certain legal limitations on the amounts that may
be contributed or the benefits that may be payable thereunder. The Board
has determined to have the Company's matching contribution under the 401(k)
Plan invested in Common Stock so as to further align employees' and
shareholders' financial interests. The Company also maintains the Stock
Bonus Plan and ESOP, which serve to further align employees' and
shareholders' interests.
Additionally, the Company makes available to its officers a
supplemental life insurance plan, supplemental benefits under its medical
reimbursement plan, a supplemental retirement plan (which is described
below under "- Supplemental Pension Plan"), a supplemental defined
contribution plan, a supplemental 401(k) plan, and a disability salary
continuation plan.
COMPENSATION OF CHIEF EXECUTIVE OFFICER. The criteria, standards and
methodology used by the Committee and Subcommittee in reviewing and
establishing the Chief Executive Officer's salary, bonus and other
compensation are the same as those used with respect to all other executive
officers, as described above. As discussed above under "- Salary," based
on its review of data compiled by the Committee's independent consulting
firm and other information, the Committee raised the salary of the Chief
Executive Officer by 4.5% during 1997, to $470,500. Application of the
Committee's compensation criteria also resulted in the Chief Executive
Officer receiving for 1997 a bonus valued at 68.2% of his base salary
consisting of $223,450 and 1,564 shares of restricted stock under the
Company's Chairman/Chief Executive Officer short-term incentive program, in
addition to a special bonus for extraordinary service of approximately
$681,400. In addition, during 1997 the Chief Executive Officer was also
granted 87,993 options, 1,616 shares of time-vested restricted stock, 1,615
shares of performance-based restricted stock and 1,616 performance shares,
all of which are described further herein.
Ernest Butler, Jr. James B. Gardner F. Earl Hogan
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As indicated above, the members of the Compensation Committee include
Ernest Butler, Jr., who, until February 1998, was an Executive Vice
President and Director of Stephens Inc., which has provided investment
banking services to the Company from time to time. The Compensation
Committee maintains an Incentive Awards Subcommittee, composed solely of
James B. Gardner and F. Earl Hogan, for purposes of, among other things,
granting stock-based incentive awards and other types of performance-based
compensation.
SUPPLEMENTAL PENSION PLAN
The Company has a Supplemental Executive Retirement Plan (the
"Supplemental Pension Plan") pursuant to which each officer who has
completed at least five years of service is entitled to receive a monthly
payment upon retirement or, under certain circumstances, attainment of age
55. The following table reflects the annual retirement benefits that a
participant with the indicated years of service and compensation level may
expect to receive under the Supplemental Pension Plan assuming retirement
at age 65. Early retirement may be taken at age 55 by any person with 15
or more years of service, with reduced benefits.
ANNUAL BENEFIT PAYABLE ON RETIREMENT
<TABLE>
<CAPTION>
Years of Service
---------------------------------------------------
Compensation 15 20 25 30
------------ ---------- ----------- ---------- ----------
<S> <C> <C> <C> <C>
$ 300,000 $ 67,500 $ 90,000 $112,500 $135,000
350,000 78,750 105,000 131,250 157,500
400,000 90,000 120,000 150,000 180,000
450,000 101,250 135,000 168,750 202,500
500,000 112,500 150,000 187,500 225,000
550,000 123,750 165,000 206,250 247,500
600,000 135,000 180,000 225,000 270,000
650,000 146,250 195,000 243,750 292,500
700,000 157,500 210,000 262,500 315,000
750,000 168,750 225,000 281,250 337,500
800,000 180,000 242,000 300,000 360,000
850,000 191,250 255,000 318,750 382,500
</TABLE>
The above table reflects the benefits payable under the Supplemental
Pension Plan assuming such benefits will be paid in the form of a monthly
lifetime annuity and before reductions relating to the receipt of Social
Security benefits as described below. The amount of an officer's monthly
payment under the Supplemental Pension Plan is equal to his number of years
of service (up to a maximum of 30 years) multiplied by the difference
between 1.5% of his average monthly compensation during the 36-month period
within his last ten years of employment in which he received his highest
compensation and 3 1/3% of his estimated monthly Social Security benefit.
Under the Supplemental Pension Plan, the number of credited years of
service at December 31, 1997 was over 30 years for Mr. Williams, 21 years
for Mr. Post, 17 years for Mr. Hanks, 14 years for Mr. Ewing and 13 years
for Mr. Perry, and the compensation upon which benefits are based is the
aggregate amount reported for each respective officer under the columns in
the Summary Compensation Table appearing above that are entitled "Salary",
"Bonus" and "Restricted Stock Awards," except that, for 1997, neither the
amounts included under the "Bonus" column relating to the Company's special
bonuses nor the amounts included under the "Restricted Stock Awards" column
relating to the Time-Vested Restricted Shares awarded as a component of
long-term incentive compensation will be included as compensation upon
which such benefits are based. In 1997, the Company awarded as part of its
long-term incentive compensation Time-Vested Restricted Shares valued in
the following amounts as of the award date: Mr. Williams, $80,497; Mr.
Post, $80,497; Mr. Hanks, $24,259; Mr. Perry, $24,259; and Mr. Ewing,
$24,259.
Mr. Williams has the option of receiving retirement benefits under
either the normal benefit formula for the Supplemental Pension Plan or
under a separate benefit formula (the "Alternative Formula") that existed
under a predecessor supplemental retirement plan in which he held
grandfathered rights when the Supplemental Pension Plan was adopted. Under
this Alternative Formula, Mr. Williams would be entitled upon retirement to
receive an annual benefit equal to 65% of his highest annual salary during
the last five years of employment. This benefit is reduced by (i) his
Social Security benefit, determined as of the date of retirement, and (ii)
the value of his Stock Bonus Plan and related PAYSOP accounts converted to
a monthly annuity. The salary upon which benefits are based is the amount
reported under the "Salary" column in the Summary Compensation Table
appearing above. Currently, the benefits Mr. Williams would receive upon
retirement under the Alternative Formula significantly exceed the benefits
he would receive under the normal benefit formula of the Supplemental
Pension Plan. The Company anticipates that this benefit level differential
will continue for the foreseeable future.
EMPLOYMENT CONTRACT WITH CHAIRMAN AND CHANGE-IN-CONTROL ARRANGEMENTS
The Company has an employment agreement with Mr. Williams providing
for, among other things, a minimum annual salary of $436,800, participation
in all of the Company's employee benefit plans and use of the Company's
aircraft. The agreement's initial three-year term has lapsed but the
agreement remains in effect from year to year, subject to the right of Mr.
Williams or the Company to terminate the agreement. If Mr. Williams is
terminated without cause or resigns under certain specified circumstances,
including following any change in control of the Company (defined
substantially similarly to the definition below), he will be entitled to
receive, in addition to all amounts to which he is entitled pursuant to the
Company's termination policies then in effect, certain severance benefits,
including (i) a lump sum cash payment equal to three times the sum of his
annual salary plus the value of any cash and stock bonuses awarded to him
during the prior year, (ii) any such additional cash payments as may be
necessary to compensate him for any federal excise taxes imposed upon
contingent change in control payments, (iii) continued participation in the
Company's employee benefit plans for three years and (iv) continued use of
the Company's aircraft for one year on terms comparable to those previously
in effect.
The Company also has agreements with each of its executive officers
(other than Mr. Williams) which entitle any such officer who is terminated
without cause or resigns under certain specified circumstances within three
years of any change in control of the Company (as defined below) to (i)
receive a lump sum cash severance payment equal to three times the sum of
such officer's annual salary plus the value of any cash and stock bonuses
awarded to the officer during the prior year (which payment is in addition
to all amounts which may be payable under the Company's termination
policies then in effect), (ii) receive any such additional cash payments as
may be necessary to compensate him for any federal excise taxes imposed
upon contingent change in control payments, and (iii) continue to receive
certain health and life insurance benefits for three years.
Under the above-referenced severance agreements, a "change in control"
of the Company would be deemed to occur upon (i) any person (as defined in
the Securities Exchange Act of 1934) becoming the beneficial owner of 30%
or more of the combined voting power of the Company's voting securities,
(ii) a majority of the Company's directors being replaced during a two-year
period, (iii) consummation of certain mergers, substantial asset sales or
similar business combinations, or (iv) the occurrence of any event relating
to the Company that would be required to be reported to the Securities and
Exchange Commission under Schedule 14A of Regulation 14A under the
Securities Exchange Act of 1934.
All employees with at least one year of service are entitled to
receive a cash termination allowance under the Company's broad-based
termination allowance plan if their service is terminated due to a
workforce reduction, layoff or elimination of job categories. The payment
is based on the number of years of service, but can in no event exceed 52
weeks of pay. Upon a change in control of the Company (defined
substantially similarly to the definition above), employees have a vested
right to receive the termination allowance then in effect if they are
terminated without cause or suffer a 15% reduction in compensation within
two years of the change in control.
In the event of a change in control of the Company (defined
substantially similarly to the definition above), the Company's benefit
plans provide, among other things, that all restrictions on outstanding
time-vested and performance-based restricted stock will lapse, all
outstanding stock options will become fully exercisable, all performance
shares will be earned, short-term incentive awards will be payable in full
for the year in which the event occurs if merited based on the Company's
annualized performance, phantom stock units credited under the Company's
supplemental defined contribution plan will be converted into cash and held
in trust, and post-retirement health and life insurance benefits will vest
with respect to certain current and former employees. In addition,
participants in the Supplemental Pension Plan who are terminated without
cause or resign under certain specified circumstances within three years of
the change in control will receive a cash payment equal to the present
value of their plan benefits (after providing age and service credits of up
to three years), determined in accordance with actuarial assumptions
specified in the plan.
PERFORMANCE GRAPH
The graph below compares the cumulative total shareholder return on
the Common Stock for the last five years with the cumulative total return
on the S&P 500 Index and the peer group of ten companies described below,
in each case assuming (i) the investment of $100 on January 1, 1993 at
closing prices on December 31, 1992 and (ii) reinvestment of dividends.
[GRAPH OMITTED]
<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------------------------------------------------------------
1992 1993 1994 1995 1996 1997
----------- ---------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Century $100.00 $ 91.07 $105.54 $114.85 $112.92 $184.10
S&P 500 Index $100.00 $ 110.09 $111.85 $153.80 $189.56 $252.82
Peer Group{ (1)} $100.00 $ 110.53 $103.36 $142.56 $153.11 $185.56
</TABLE>
(1) The peer group consists of the ten telecommunications companies that for
several years comprised the Value Line Telecommunications/Other Majors
Index. Since the federal proxy rules were amended in the early 1990's to
require the inclusion of performance graphs in proxy statements, the
Company has compared its market performance against this particular index.
In January 1998, Value Line renamed its telecommunications index and
broadened its scope by adding 21 additional companies, several of which
engage in lines of business different from the Company's. The Company
believes that it is more appropriate to continue to compare its market
performance against Value Line's predecessor index rather than Value
Line's restructured index. The ten companies comprising the predecessor
index are as follows: Aliant Communications, Inc., ALLTEL Corporation,
Cincinnati Bell Inc., Citizens Utilities Company, COMSAT Corporation,
Frontier Corporation, GTE Corporation, The Southern New England Telephone
Company, Telephone & Data Systems, Inc., and the Company.
CERTAIN TRANSACTIONS
The Company paid approximately $799,000 to Boles, Boles & Ryan, a
professional law corporation, for legal services rendered to the Company in
1997. William R. Boles, Jr., a director of the Company since 1992, is
President and a director and practicing attorney with such firm, which has
provided legal services to the Company since 1968.
During 1997, the Company paid approximately $790,000 to a real estate
firm owned by the brother of Harvey P. Perry, the Company's Senior Vice
President, Secretary and General Counsel. In exchange for such payments (a
substantial portion of which were used to compensate subcontractors and
vendors and to recoup other out-of-pocket costs), such firm provided a
variety of services with respect to several of the Company's office sites
and over 85 of its cellular tower sites in several states, including
locating and analyzing properties suitable for acquisition as cellular
tower sites, negotiating purchase terms with the land owners, and
subleasing cellular tower space.
During 1997, the Company purchased approximately $372,000 of electrical
contracting services from a firm owned by the wife and son of Johnny
Hebert, a director of the Company.
During 1997, the Company purchased approximately $52,000 of maintenance
services and other related aviation support services from Legacy Aviation,
Inc., which has provided services to the Company since 1987. In 1995,
Clarke M. Williams, the Company's Chairman of the Board, purchased Legacy
Aviation, Inc. from unaffiliated parties.
During 1997, the Company paid in the ordinary course of business
approximately $107,239 for automobiles, computers and certain services from
companies owned and operated by Calvin Czeschin and his family. Mr.
Czeschin is a director of the Company.
For further information see "Compensation Committee Interlocks and
Insider Participation."
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Securities Exchange Act of 1934 requires the Company's
executive officers and directors, among others, to file certain beneficial
ownership reports with the SEC. During 1997, all such reports were timely
filed.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
KPMG Peat Marwick LLP, independent certified public accountants for
the Company for 1997, has been selected by the Board to serve again in that
capacity for 1998. A representative of such firm is expected to attend the
Meeting and will be available to respond to appropriate questions.
OTHER MATTERS
QUORUM AND VOTING OF PROXIES
The presence, in person or by proxy, of a majority of the total
voting power of the Voting Shares is necessary to constitute a quorum to
organize the Meeting. Shareholders voting or abstaining from voting on any
issue will be counted as present for purposes of constituting a quorum to
organize the Meeting. If a quorum is present, directors will be elected by
plurality vote and, as such, withholding authority to vote in the election
of directors will not affect whether the proposed nominees named herein are
elected.
Under the rules of the New York Stock Exchange, brokers who hold
shares in street name for customers may vote in their discretion on matters
when they have not received voting instructions from beneficial owners
unless the matter is a non-routine, "non-discretionary" item. According to
the New York Stock Exchange, brokers who do not receive such instructions
will be entitled to vote in their discretion with respect to the Company's
election of directors. If brokers who do not receive voting instructions
do not exercise such discretionary voting power (a "broker non-vote"),
shares that are not voted will be treated as present for purposes of
constituting a quorum to organize the Meeting but not present with respect
to the election of directors. Because the election of directors must be
approved by plurality vote, broker non-votes with respect to these
proposals will not affect the outcome of the voting.
Voting Shares represented by all properly executed proxies received
in time for the Meeting will be voted at the Meeting. A proxy may be
revoked at any time before it is exercised by filing with the Secretary of
the Company a written revocation or a duly executed proxy bearing a later
date, or by attending the Meeting and voting in person. Unless revoked,
the proxy will be voted as specified and, if no specifications are made,
will be voted in favor of the proposed nominees.
Management is unaware of any matter for action by shareholders at
the Meeting other than the election of directors. The enclosed proxy,
however, will confer discretionary authority with respect to any other
matter that may properly come before the Meeting. It is the intention of
the persons named therein to vote in accordance with their best judgment on
any such matter.
SHAREHOLDER NOMINATIONS AND PROPOSALS
In order to be eligible for inclusion in the Company's 1999 proxy
materials pursuant to the federal proxy rules, any shareholder proposal to
take action at such meeting must be received at the Company's principal
executive offices by November 23, 1998. In addition, the Company's by-laws
provide that shareholders intending to nominate a director or bring any
other matter before a shareholders' meeting must furnish timely written
notice. In general, notice must be received by the Secretary of the
Company between October 9, 1998 and February 26, 1999 and must contain
specified information concerning, among other things, the matters to be
brought before such meeting and concerning the shareholder proposing such
matters. If the date of the 1999 annual meeting is more than 30 days
earlier or later than May 7, 1999, notice must be received by the Secretary
of the Company within 15 days of the earlier of the date on which notice of
such meeting is first mailed to shareholders or public disclosure of the
meeting date is made. The Company will be permitted to disregard any
nomination or other matter that fails to comply with these by-law
procedures.
By Order of the Board of Directors
/s/ Harvey P. Perry
Harvey P. Perry
Secretary
Dated: March 19, 1998
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CENTURY TELEPHONE ENTERPRISES, INC.
The undersigned hereby constitutes and appoints Clarke M. Williams
or Glen F. Post, III, or either of them, proxies for the undersigned, with full
power of substitution, to represent the undersigned and to cast the number of
votes attributable to all of the shares of common stock and voting preferred
stock (collectively, the "Voting Shares") of Century Telephone Enterprises,
Inc. (the "Company") that the undersigned is entitled to vote at the annual
meeting of shareholders of the Company to be held on May 7, 1998, and at any
and all adjournments thereof (the "Meeting").
1. To elect five Class I Directors.
FOR __ all nominees listed below WITHHOLD AUTHORITY _____ to vote
(except as marked to the for all nominees
contrary below) listed below
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW:
William R. Boles, Jr. W. Bruce Hanks C.G. Melville, Jr.
Glen F. Post, III Clarke M. Williams
2. In their discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE NOMINEES LISTED ABOVE.
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFIC DIRECTIONS ARE GIVEN,
ALL OF THE VOTES ATTRIBUTABLE TO YOUR VOTING SHARES WILL BE VOTED FOR THE
NOMINEES.
________________ _______________________________
DATE NAME (PLEASE PRINT)
Please sign exactly as name appears on the
____________________________ certificate or certificates representing
SIGNATURE shares to be voted by this proxy. When
signing as executor, administrator,
attorney, trustee or guardian, please give
____________________________ full title as such. If a corporation,
ADDITIONAL SIGNATURE please sign in full corporate name
(IF JOINTLY HELD) by president or other authorized officer.
If a partnership, please sign in partnership
name by authorized persons.
<PAGE>
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CENTURY TELEPHONE ENTERPRISES, INC.
The undersigned hereby constitutes and appoints Clarke M. Williams
or Glen F. Post, III, or either of them, proxies for the undersigned, with full
power of substitution, to represent the undersigned and to vote the number of
votes attributable to all of the shares of common stock and voting preferred
stock (collectively, the "Voting Shares") of Century Telephone Enterprises,
Inc. (the "Company") that the undersigned is entitled to vote at the annual
meeting of shareholders of the Company to be held on May 7, 1998 (the
"Meeting"), and at any and all adjournments thereof.
1. To elect five Class I Directors.
FOR __ all nominees listed below WITHHOLD AUTHORITY _____ to vote
(except as marked to the for all nominees
contrary below) listed below
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW:
William R. Boles, Jr. W. Bruce Hanks C.G. Melville, Jr.
Glen F. Post, III Clarke M. Williams
2. In their discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE NOMINEES LISTED ABOVE.
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFIC DIRECTIONS ARE GIVEN,
ALL OF THE VOTES ATTRIBUTABLE TO YOUR VOTING SHARES WILL BE VOTED FOR THE
NOMINEES.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
LONG-TERM SHARES SHORT-TERM SHARES TOTAL VOTES
(10 votes per share) (1 vote per share)
- - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
DIVIDEND REINVESTMENT
VOTING SHARES
- - -------------------------------------------------------------------------------------------------------------------
ALL OTHER VOTING SHARES
- - -------------------------------------------------------------------------------------------------------------------
GRAND TOTAL OF YOUR VOTES
----------------------------------------------------------------------------------
</TABLE>
________________ _______________________________
DATE NAME (PLEASE PRINT)
Please sign exactly as name appears on the
____________________________ certificate or certificates representing
SIGNATURE shares to be voted by this proxy. When
signing as executor, administrator,
attorney, trustee or guardian, please give
____________________________ full title as such. If a corporation,
ADDITIONAL SIGNATURE please sign in full corporate name
(IF JOINTLY HELD) by president or other authorized officer.
If a partnership, please sign in partnership
name by authorized persons.
<PAGE>
VOTING INSTRUCTIONS OF NAMED FIDUCIARY - ESOP SHARES
The undersigned, acting as a "Named Fiduciary" of the Century Telephone
Enterprises, Inc. Employee Stock Ownership Plan and Trust, as amended (the
"ESOP"), hereby instructs Regions Bank (the "Trustee"), as trustee of the ESOP,
to attend the annual meeting of shareholders of Century Telephone Enterprises,
Inc. (the "Company") to be held on May 7, 1998, and any and all adjournments
thereof (the "Meeting"), and to cast thereat in the manner designated below (i)
the number of votes allocable to the undersigned that are attributable to all
shares of the Company's common stock held by the Trustee and credited to the
ESOP account of the undersigned as of December 31, 1997, in accordance with the
provisions of the ESOP (the "Undersigned's Allocable Votes") and (ii) the
number of votes allocable to the undersigned (determined pursuant to a formula
specified in the ESOP) that are attributable to all shares of the Company's
common stock held by the Trustee as of December 31, 1997 that are unallocated
or as to which properly executed voting instructions are not timely received
prior to the commencement of the Meeting (referred to individually as the
"Undersigned's Proportionate Votes" and collectively with the Undersigned's
Allocable Votes as the "Undersigned's Votes").
1. To elect five Class I Directors.
Undersigned's
Allocable
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
Undersigned's
Proportionate
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST
BELOW:
Undersigned's Allocable Votes: William R. Boles, Jr. / W. Bruce Hanks /
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
Undersigned's Proportionate Votes: William R. Boles, Jr. / W. Bruce Hanks/
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
2. In its discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES LISTED ABOVE. Upon timely receipt of these instructions, properly
executed, the Undersigned's Votes will be cast in the manner directed. If
these instructions are properly executed but no specific directions are given
with respect to the Undersigned's Allocable Votes or the Undersigned's
Proportionate Votes, these votes will be cast for the nominees.
Date: ______, 1998 __________________________________________________
Signature of Participant
Number of
Allocated Shares
as of December 31,
1997:
Please mark, sign, date and return these instructions promptly using the
enclosed envelope.
<PAGE>
VOTING INSTRUCTIONS OF NAMED FIDUCIARY - STOCK BONUS PLAN SHARES
The undersigned, acting as a "Named Fiduciary" of the Century Telephone
Enterprises, Inc. Stock Bonus Plan, PAYSOP and Trust, as amended (the "Stock
Bonus Plan"), hereby instructs Regions Bank (the "Trustee"), as trustee of the
Stock Bonus Plan, to attend the annual meeting of shareholders of Century
Telephone Enterprises, Inc. (the "Company") to be held on May 7, 1998, and any
and all adjournments thereof (the "Meeting"), and to cast thereat in the manner
designated below (i) the number of votes allocable to the undersigned that are
attributable to all shares of the Company's common stock (except for PAYSOP
shares) held by the Trustee and credited to the Stock Bonus Plan account of the
undersigned as of December 31, 1997, in accordance with the provisions of the
Stock Bonus Plan (the "Undersigned's Allocable Votes") and (ii) the number of
votes allocable to the undersigned (determined pursuant to a formula specified
in the Stock Bonus Plan) that are attributable to all shares of the Company's
common stock (except for PAYSOP shares) held by the Trustee as of December 31,
1997 that are unallocated or as to which properly executed voting instructions
are not timely received prior to the commencement of the Meeting (referred to
individually as the "Undersigned's Proportionate Votes" and collectively with
the Undersigned's Allocable Votes as the "Undersigned's Votes").
1. To elect five Class I Directors.
Undersigned's
Allocable
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
Undersigned's
Proportionate
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST
BELOW:
Undersigned's Allocable Votes: William R. Boles, Jr. / W. Bruce Hanks /
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
Undersigned's Proportionate Votes: William R. Boles, Jr. / W. Bruce Hanks/
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
2. In its discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES LISTED ABOVE. Upon timely receipt of these instructions, properly
executed, the Undersigned's Votes will be cast in the manner directed. If
these instructions are properly executed but no specific directions are given
with respect to the Undersigned's Allocable Votes or the Undersigned's
Proportionate Votes, these votes will be cast for the nominees.
Date: _______, 1998 __________________________________________________
Signature of Participant
Number of
Allocated Shares
as of December 31,
1997:
Please mark, sign, date and return these instructions promptly using the
enclosed envelope.
<PAGE>
VOTING INSTRUCTIONS - PAYSOP SHARES
The undersigned hereby instructs Regions Bank (the "Trustee"), as
trustee of the Century Telephone Enterprises, Inc. Stock Bonus Plan, PAYSOP and
Trust, as amended (the "Stock Bonus Plan"), to attend the annual meeting of
shareholders of Century Telephone Enterprises, Inc. (the "Company") to be held
on May 7, 1998, and any and all adjournments thereof (the "Meeting"), and to
cast thereat in the manner designated below the number of votes allocable to
the undersigned that are attributable to all shares of the Company's common
stock held by the Trustee and credited to the PAYSOP account of the undersigned
as of December 31, 1997, in accordance with the provisions of the Stock Bonus
Plan (the "Undersigned's Votes").
1. To elect five Class I Directors.
FOR ____ all nominees listed below WITHHOLD AUTHORITY _____ to vote for
(except as marked to the all nominees
contrary below) listed below
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW:
William R. Boles, Jr. W. Bruce Hanks C.G. Melville, Jr.
Glen F. Post, III Clarke M. Williams
2. In its discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES LISTED ABOVE. Upon timely receipt of these instructions, properly
executed, the Undersigned's Votes will be cast in the manner directed. If
these instructions are properly executed but no specific directions are given,
the Undersigned's Votes will be cast for the nominees.
Date: ______, 1998 __________________________________________________
Signature of Participant
Number of
Allocated Shares
as of December 31,
1997:
Please mark, sign, date and return these instructions promptly using the
enclosed envelope.
<PAGE>
VOTING INSTRUCTIONS OF NAMED FIDUCIARY - RETIREMENT SAVINGS PLAN SHARES
The undersigned, acting as a "Named Fiduciary" of the Century
Telephone Enterprises, Inc. Retirement Savings Plan for Bargaining Unit
Employees and Trust, as amended (the "Retirement Savings Plan"), hereby
instructs Merrill Lynch Trust Company, FSB (the "Trustee"), as trustee of the
Retirement Savings Plan, to attend the annual meeting of shareholders of
Century Telephone Enterprises, Inc. (the "Company") to be held on May 7, 1998,
and any and all adjournments thereof (the "Meeting"), and to cast thereat in
the manner designated below (i) the number of votes allocable to the
undersigned that are attributable to all shares of the Company's common stock
held by the Trustee and credited to the Retirement Savings Plan account of the
undersigned as of March 9, 1998, in accordance with the provisions of the
Retirement Savings Plan (the "Undersigned's Allocable Votes") and (ii) the
number of votes allocable to the undersigned (determined pursuant to a formula
specified in the Retirement Savings Plan) that are attributable to all shares
of the Company's common stock held by the Trustee as of March 9, 1998, that are
unallocated or as to which properly executed voting instructions are not timely
received prior to the commencement of the Meeting (referred to individually as
the "Undersigned's Proportionate Votes" and collectively with the Undersigned's
Allocable Votes as the "Undersigned's Votes").
1. To elect five Class I Directors.
Undersigned's
Allocable
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
Undersigned's
Proportionate
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST
BELOW:
Undersigned's Allocable Votes: William R. Boles, Jr. / W. Bruce Hanks /
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
Undersigned's Proportionate Votes: William R. Boles, Jr. / W. Bruce Hanks/
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
2. In its discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES LISTED ABOVE. Upon timely receipt of these instructions, properly
executed, the Undersigned's Votes will be cast in the manner directed. If
these instructions are properly executed but no specific directions are given
with respect to the Undersigned's Allocable Votes or the Undersigned's
Proportionate Votes, these votes will be cast for the nominees.
Date: ________, 1998 _______________________________________________
Signature of Participant
Name of Participant: Number of
Allocated Shares
.................................. as of March 9,
Mailing Address: 1998:
....................
Please mark, sign, date and return these instructions promptly using the
enclosed envelope.
<PAGE>
VOTING INSTRUCTIONS OF NAMED FIDUCIARY - DOLLARS & SENSE PLAN SHARES
The undersigned, acting as a "Named Fiduciary" of the Century
Telephone Enterprises, Inc. Dollars & Sense Plan and Trust, as amended (the
"Dollars & Sense Plan"), hereby instructs Merrill Lynch Trust Company, FSB (the
"Trustee"), as trustee of the Dollars & Sense Plan, to attend the annual
meeting of shareholders of Century Telephone Enterprises, Inc. (the "Company")
to be held on May 7, 1998, and any and all adjournments thereof (the
"Meeting"), and to cast thereat in the manner designated below (i) the number
of votes allocable to the undersigned that are attributable to all shares of
the Company's common stock held by the Trustee and credited to the Dollars &
Sense Plan account of the undersigned as of March 9, 1998, in accordance with
the provisions of the Dollars & Sense Plan (the "Undersigned's Allocable
Votes") and (ii) the number of votes allocable to the undersigned (determined
pursuant to a formula specified in the Dollars & Sense Plan) that are
attributable to all shares of the Company's common stock held by the Trustee as
of March 9, 1998 that are unallocated or as to which properly executed voting
instructions are not timely received prior to the commencement of the Meeting
(referred to individually as the "Undersigned's Proportionate Votes" and
collectively with the Undersigned's Allocable Votes as the "Undersigned's
Votes").
1. To elect five Class I Directors.
Undersigned's
Allocable
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
Undersigned's
Proportionate
Votes: FOR _____ all nominees listed WITHHOLD AUTHORITY _____ to vote for
below (except as all nominees
marked to the contrary listed below
below)
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST
BELOW:
Undersigned's Allocable Votes: William R. Boles, Jr. / W. Bruce Hanks /
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
Undersigned's Proportionate Votes: William R. Boles, Jr. / W. Bruce Hanks/
C.G. Melville, Jr. / Glen F. Post, III /
Clarke M. Williams
2. In its discretion to vote upon such other business as may properly come
before the Meeting.
(Please See Reverse Side)
===============================================================================
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES AND THE PROPOSALS LISTED ABOVE. Upon timely receipt of these
instructions, properly executed, the Undersigned's Votes will be cast in the
manner directed. If these instructions are properly executed but no specific
directions are given with respect to the Undersigned's Allocable Votes or the
Undersigned's Proportionate Votes, these votes will be cast for the nominees.
Date: ________, 1998 _______________________________________________
Signature of Participant
Name of Participant: Number of
Allocated Shares
.................................. as of March 9,
Mailing Address: 1998:
....................
Please mark, sign, date and return these instructions promptly using the
enclosed envelope.
