<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
- --------------------------------------------------------------------------------
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
Eastern Enterprises
(Name of Registrant as Specified In Its Charter)
/ /
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act
Rule 0-11:
4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
Eastern Enterprises
March 15, 1994
Dear Shareholder:
The Board of Trustees joins me in inviting you to attend Eastern's Annual
Meeting at 10:00 a.m. on Thursday, April 28, 1994 in the AUDITORIUM OF THE BANK
OF BOSTON, 100 FEDERAL STREET, BOSTON, MASSACHUSETTS.
The accompanying Annual Report to Shareholders reports on the Company's
operations and outlook. The Notice of Annual Meeting and Proxy Statement contain
a description of the formal business to be acted upon by the shareholders. At
the meeting, we intend to continue our practice of discussing Eastern's
operating businesses and their prospects. Trustees, officers and other
executives, as well as representatives of Eastern's independent accountants,
will be available, both before and during the meeting, to answer any questions
you may have.
I would like to take this opportunity to welcome as shareholders the many
employees who are participants in Eastern's Employee Stock Purchase Plan, which
was instituted in 1993, and thank them for their interest and support.
A proxy card and a postage-paid envelope are enclosed. Your vote,
regardless of the number of shares you own, is important. Whether or not you
plan to attend the meeting, I urge you to register your vote now by signing,
dating and returning the enclosed proxy card as soon as possible in the envelope
provided.
I look forward to personally greeting as many shareholders as possible at
the meeting.
Sincerely,
/s/ J. Atwood Ives
J. Atwood Ives
Chairman and Chief
Executive Officer
<PAGE> 3
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 28, 1994
To the Holders of Common Stock of
Eastern Enterprises:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Eastern
Enterprises (the "Association") will be held in the AUDITORIUM OF THE BANK OF
BOSTON, 100 FEDERAL STREET, BOSTON, MASSACHUSETTS, at 10 o'clock in the morning
on Thursday, April 28, 1994 for the following purposes:
(1) To elect four Trustees to serve until the 1997 Annual Meeting of
Shareholders and until their successors are elected and qualified; and
(2) To consider and act upon any other matters that may properly come before
the meeting or any adjournment thereof.
Shareholders of record at the close of business on March 7, 1994 are the
shareholders entitled to receive notice of and to vote at such meeting.
Shareholders who wish their stock to be voted by proxy are requested to
date and sign the enclosed form of proxy and to return it in the enclosed
envelope. A resolution adopted by the Trustees of the Association provides that
shares voted by proxy shall be counted only if the proxy form has been presented
for validation to the Secretary prior to the meeting or, if the meeting is
adjourned to another day, prior to such adjourned session.
By order of the Board of Trustees
L. William Law, Jr., General Counsel
and Secretary
March 15, 1994
1
<PAGE> 4
PROXY STATEMENT
The enclosed form of proxy has been prepared at the direction of the Board
of Trustees of the Association, 9 Riverside Road, Weston, Massachusetts 02193.
Such proxy is solicited on behalf of, and the proxies named therein have been
designated by, the Board of Trustees. Giving the proxy will not affect your
right to revoke the proxy prior to voting and vote in person should you decide
to attend the meeting. Written notice of any such revocation may be addressed to
the Secretary of the Association. Shares represented by the enclosed form of
proxy, when properly executed and presented, will be voted as directed therein.
This Proxy Statement, the enclosed form of proxy and the Annual Report to
Shareholders, including financial statements, were mailed together to
shareholders on or about March 15, 1994.
OUTSTANDING SHARES AND VOTING POWER
At the close of business on March 7, 1994, the record date fixed by the
Board of Trustees for determining shareholders entitled to notice of and to vote
at the 1994 Annual Meeting of Shareholders, the Association had outstanding
20,967,526 shares of Common Stock. Under Article 11 of the Declaration of Trust
of the Association, a quorum for the consideration of questions to be presented
to the 1994 Annual Meeting of Shareholders shall consist of the holders of a
majority of shares of Common Stock issued and outstanding, provided that less
than a quorum may adjourn the meeting from time to time. Votes cast by proxy or
in person at the 1994 Annual Meeting of Shareholders will be counted by persons
appointed by the Association to act as election inspectors for the meeting.
Article 24 of the Declaration of Trust of the Association provides that:
"Shares of this trust which by the provisions of this Declaration are
entitled to vote upon any question shall be entitled to one vote per
share in person or by proxy, except that the election of Trustees by
the Common Stock shall be by cumulative voting, namely, each holder of
Common Stock will be entitled to as many votes as will equal the
number of his shares multiplied by the number of Trustees to be
elected, and he may cast all of such votes for a single candidate or
distribute them among any two or more candidates as he shall elect."
The four nominees for election as Trustees at the 1994 Annual Meeting of
Shareholders who receive the greatest number of votes properly cast will be
elected as Trustees. Proxies withholding authority to vote for one or more
nominees will thus have no effect on the outcome of the election.
INFORMATION WITH RESPECT TO CERTAIN SHAREHOLDERS
The Association has received a copy of a statement on Schedule 13D filed
pursuant to Rule 13d-1 under the Securities Exchange Act of 1934 (the "1934
Act") by Mario J. Gabelli and Gabelli Funds, Inc., One Corporate Center, Rye,
New York 10580, and investment advisor and broker-dealer entities controlled by
them, indicating that collectively they owned beneficially (as defined by Rule
13d-3 under the 1934 Act) on January 20, 1993, a total of 1,383,300 shares of
the Association's outstanding Common Stock, representing 6.6% of such
outstanding stock. The statement also indicated that they had sole dispositive
power with respect to 1,018,000 shares, shared dispositive power with respect to
365,300 shares, sole voting power with respect to 959,000 shares and shared
voting power with respect to 365,300 shares.
The Association has received a copy of a statement on Schedule 13G filed
pursuant to Rule 13d-1 under the 1934 Act by Hotchkis and Wiley, 800 West Sixth
Street, Los Angeles, California 90017, an investment advisor, indicating that it
owned beneficially (as defined by Rule 13d-3 under the 1934 Act) on December 31,
1993, a total of 1,252,100 shares of the Association's outstanding Common Stock,
representing 6.0% of such
2
<PAGE> 5
outstanding stock. The statement also indicated that it had sole voting power
with respect to all such shares and no dispositive power with respect to any
such shares.
ELECTION OF TRUSTEES
The Board of Trustees is divided into three classes having staggered terms
of three years each. The Declaration of Trust of the Association provides that
the number of Trustees shall be fixed from time to time by the Trustees but
shall not be less than three or more than twenty. The total number of Trustees
to serve following the 1994 Annual Meeting is currently fixed at twelve. Four of
the Trustees now in office have terms expiring at the 1996 Annual Meeting, and
four have terms expiring at the 1995 Annual Meeting. Of the five Trustees now in
office having terms expiring at the 1994 Annual Meeting, four have been
nominated by the Board of Trustees for reelection at such meeting and the fifth,
Lawrence E. Thompson, is retiring from the Board of Trustees in accordance with
an established retirement policy of the Board. Each Trustee elected at the 1994
Annual Meeting of Shareholders will hold office until the 1997 Annual Meeting of
Shareholders, and until such Trustee's successor is elected and qualified;
however, it is anticipated that Harold T. Miller and William G. Salatich will
resign from the Board and committees thereof in accordance with such retirement
policy at the time of the 1995 Annual Meeting.
INFORMATION WITH RESPECT TO BOARD OF TRUSTEES
The Board of Trustees, which held eight regularly scheduled meetings and
one special meeting in 1993, maintains a standing Audit Committee, Compensation
Committee and Nominating Committee, each of which is comprised of Trustees who
are not officers or employees of the Association or any of its subsidiaries. The
Board of Trustees also maintains an Executive Committee which has substantially
all of the powers and discretion of the full Board of Trustees. Membership on
the various committees is indicated in the biographical information which
follows.
The Audit Committee, which met seven times in 1993, is responsible for
reviewing the performance and recommending the engagement of the Association's
independent auditors, reviewing the scope of the audit and approving all fees
paid to such auditors. The Audit Committee also reviews the Association's audit
and accounting procedures, internal controls, financial reporting practices and
annual and quarterly reports, and meets with, and reviews the audit plans of,
the Association's internal audit department.
The Compensation Committee, which met five times in 1993, is responsible
for approving officer compensation arrangements, recommending Trustee
compensation arrangements, administering stock option and other compensation and
benefit plans, and reviewing major personnel policies and benefit programs of
the Association and its subsidiaries.
The Nominating Committee, which met twice in 1993, is responsible for
nominating Trustees, members of committees of the Board of Trustees and officers
of the Association, and reviewing management development and succession
programs. It will consider nominees for the Board of Trustees recommended by
shareholders of the Association. Written recommendations together with
supporting information should be directed to Eastern Enterprises, Attn: The
Nominating Committee, 9 Riverside Road, Weston, Massachusetts 02193. NOMINATIONS
FOR THE ELECTION OF TRUSTEES AT AN ANNUAL MEETING MAY BE MADE BY A SHAREHOLDER
ONLY IF WRITTEN NOTICE OF SUCH SHAREHOLDER'S INTENT TO MAKE SUCH NOMINATION HAS
BEEN GIVEN TO THE SECRETARY NOT LATER THAN FORTY-FIVE DAYS PRIOR TO THE
ANNIVERSARY OF THE DATE OF THE IMMEDIATELY PRECEDING ANNUAL MEETING. SUCH NOTICE
SHALL SET FORTH THE INFORMATION REQUIRED BY ARTICLE 6 OF THE ASSOCIATION'S
DECLARATION OF TRUST.
3
<PAGE> 6
INFORMATION WITH RESPECT TO NOMINEES AND TRUSTEES
It is the intention of the management proxies to vote for the election of
the four nominees listed below. The management proxies will distribute the total
number of votes to which the shareholder executing the proxy is entitled among
the four nominees in such manner as such proxies in their discretion shall
determine unless other instructions are given in the proxy by the shareholder
executing it. If any nominee is not available as a candidate when the election
occurs, discretionary authority is reserved to vote for a substitute. Management
has no reason to believe that any nominee will not be available.
THE NOMINEES FOR TERMS OF OFFICE EXPIRING AT THE 1997 ANNUAL MEETING OF
SHAREHOLDERS ARE AS FOLLOWS:
RICHARD R. CLAYTON, PRESIDENT AND CHIEF OPERATING OFFICER OF THE
ASSOCIATION. Mr. Clayton is 55 years old and is a graduate of
Purdue University. Prior to joining Eastern in 1987 as its
Executive Vice President and Chief Administrative Officer, Mr.
Clayton was Chairman and Chief Executive Officer of Vermont
Castings, Inc. He is a member of the Board of Governors of the
New England Aquarium, a Vice President of the New England
Chapter of the National Association of Corporate Directors and
President of the Concord Museum's Board of Governors.
Trustee since 1993
LEONARD R. JASKOL, CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF
LYDALL, INC., A MANUFACTURING COMPANY. Mr. Jaskol is 57 years
old and is a graduate of American University and City University
of New York Graduate School of Business. He is a Director of
Rogers Corporation, the Connecticut Business and Industry
Association and the American Forest and Paper Association and
Chairman of that Association's Specialty Manufacturer Group; a
Trustee of American University; and a member of the Advisory
Board, Shawmut Bank of Hartford.
Elected to Board of Trustees
February, 1994
HAROLD T. MILLER, RETIRED CHAIRMAN AND CHIEF EXECUTIVE OFFICER,
HOUGHTON MIFFLIN COMPANY, A PUBLISHING COMPANY. Mr. Miller is 71
years old and is a graduate of Franklin and Marshall College and
Teachers College, Columbia University. He is a Director of
Associated Industries of Massachusetts and of Meridan-Stinehour,
Inc. (the Stinehour Press); a Senior Member of the Board of
Trustees of The Conference Board; Chairman of the Board of
Visitors of Northeastern University College of Business
Administration; a Member of the Editorial Board of Harvard
Business School Press; and a Council Member of the American
Antiquarian Society. He also serves in various capacities with
other educational and literary institutions.
Trustee since 1982;
member, Compensation and Nominating Committees
WILLIAM G. SALATICH, PRESIDENT, WILLIAM G. SALATICH CONSULTING
INC. Mr. Salatich is 71 years old, attended Northwestern
University and has an honorary doctor of business degree from
Curry College. He is a former President of Gillette North
America and Vice Chairman of The Gillette Company. Mr. Salatich
is a Director of Forsyeth-McArthur Corp., American Communication
Services, Inc. and DigiVision, Inc., and a Trustee of the
Massachusetts Eye and Ear Infirmary.
Trustee since 1975; Chairman, Compensation Committee;
member, Executive Committee
4
<PAGE> 7
THE MEMBERS OF THE BOARD OF TRUSTEES HAVING TERMS OF OFFICE EXPIRING AT THE
1996 ANNUAL MEETING OF SHAREHOLDERS ARE AS FOLLOWS:
SAMUEL FRANKENHEIM, COUNSEL, ROPES & GRAY. Mr. Frankenheim is 61
years old and is a graduate of Cornell University and Cornell
University Law School. Prior to joining Ropes & Gray in 1992,
Mr. Frankenheim was Senior Vice President, General Counsel,
Secretary and a member of the Office of the Chairman of General
Cinema Corporation (now Harcourt General, Inc.) and of The
Neiman Marcus Group, Inc. He is a Trustee of the Wang Center for
the Performing Arts, Boston, and the Huntington Theater Company,
Boston; a Director of the International Alliance of First Night
Celebrations; and an Overseer of Newton-Wellesley Hospital.
Trustee since 1993;
member, Audit Committee
ROBERT P. HENDERSON, CHAIRMAN, GREYLOCK MANAGEMENT CORPORATION,
A VENTURE CAPITAL FIRM. Mr. Henderson is 62 years old and is a
graduate of Dartmouth College and Amos Tuck School of Business
Administration. Mr. Henderson is a Director of Structural
Dynamics Research Corp., Filene's Basement, Inc., Cabot
Corporation and Thompson Advisory Group, Inc. He is former
Chairman of the Board of the Federal Reserve Bank of Boston; a
Member of the Corporation of New England Deaconess Hospital; and
a Trustee, Museum of Fine Arts, Boston.
Trustee since 1978; Chairman, Nominating Committee;
member, Compensation Committee
THOMAS W. JONES, PRESIDENT AND CHIEF OPERATING OFFICER, TEACHERS
INSURANCE AND ANNUITY ASSOCIATION/COLLEGE RETIREMENT EQUITIES
FUND (TIAA/CREF). Mr. Jones is 44 years old and is a graduate of
Cornell University and Boston University School of Management.
Prior to joining TIAA/CREF in 1989 as its Executive Vice
President of Finance and Planning and Chief Financial Officer,
Mr. Jones was Senior Vice President and Treasurer of John
Hancock Mutual Life Insurance Company. He is a Director of
Thomas & Betts Corporation and a Trustee of Cornell University.
Trustee since 1990;
Chairman, Audit Committee
RINA K. SPENCE, PRESIDENT AND CHIEF EXECUTIVE OFFICER, EMERSON
HEALTH SYSTEM, INC. AND EMERSON HOSPITAL. Ms. Spence is 45 years
old and is a graduate of Boston University and Harvard
University, Kennedy School of Government. Ms. Spence is a
Trustee of the Wang Center for the Performing Arts, Boston, and
the Boston Ballet, a Trustee of the University of Massachusetts
and a Director of Berkshire Mutual Life Insurance Co.
Trustee since 1989;
member, Compensation and Nominating Committees
5
<PAGE> 8
THE MEMBERS OF THE BOARD OF TRUSTEES HAVING TERMS OF OFFICE EXPIRING AT THE
1995 ANNUAL MEETING OF SHAREHOLDERS ARE AS FOLLOWS:
NELSON J. DARLING, JR., TRUSTEE AND DIRECTOR. Mr. Darling is 73
years old and is a graduate of Harvard College and Harvard Law
School. He is a Trustee of several mutual funds advised by
Massachusetts Financial Services Company.
Trustee since 1974;
member, Audit and Nominating Committees
DEAN W. FREED, DIRECTOR AND RETIRED CHAIRMAN, EG&G, INC., A
TECHNOLOGICAL PRODUCTS AND SERVICES COMPANY. Mr. Freed is 70
years old, is a graduate of Swarthmore College and Purdue
University, and attended Columbia University. Mr. Freed is a
Director of Emerson Hospital; Chairman of the New England
Aquarium; a Trustee of the Boston Ballet and the Boston Symphony
Orchestra; and an Overseer of the WGBH Educational Foundation
and the Museum of Fine Arts, Boston.
Trustee since 1980;
member, Audit and Executive Committees
J. ATWOOD IVES, CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF THE
ASSOCIATION. Mr. Ives is 57 years old, is a graduate of Yale
College and Stanford University Graduate School of Business, and
is a certified public accountant. Prior to joining the
Association in 1991, he was Vice Chairman, Chief Financial
Officer and a member of the Office of the Chairman of General
Cinema Corporation (now Harcourt General, Inc.) and of The
Neiman Marcus Group, Inc. He is a Director of United States
Filter Corporation; a Trustee of Property Capital Trust and the
Museum of Fine Arts, Boston; a Director or Trustee of several
mutual funds advised by Massachusetts Financial Services
Company; an Overseer of the Boston Museum of Science; and a
member of the Corporate Advisory Board, Stanford University
Graduate School of Business.
Trustee since 1989;
Chairman, Executive Committee
WILLIAM J. PRUYN, RETIRED CHAIRMAN OF THE BOARD OF THE
ASSOCIATION. Mr. Pruyn is 71 years old, is a graduate of
Northeastern University and Bentley College and attended the
Advanced Management Program, Harvard Graduate School of Business
Administration. In 1985, he received an honorary doctor of
humane letters degree from Northeastern University. He joined
the Association in 1951 and in 1972 became President of Boston
Gas Company. He became President and Chief Executive Officer of
the Association in 1977. In 1986, he was appointed Chairman of
the Board and Chief Executive Officer, and in 1987, Chairman of
the Board. Mr. Pruyn is a Trustee and a Member of the Executive
Committee of Northeastern University and a Trustee of the New
England Aquarium.
Trustee since 1973
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<PAGE> 9
<TABLE>
STOCK OWNERSHIP OF TRUSTEES AND EXECUTIVE OFFICERS
The following information is furnished as to the Common Stock of the
Association owned beneficially (as defined by Rule 13d-3 under the Securities
Exchange Act of 1934) as of February 25, 1994 by each Trustee and nominee, each
executive officer named in the Summary Compensation Table on page 8, and the
Trustees and executive officers of the Association as a group. The information
concerning beneficial ownership has been furnished by the persons listed below.
<CAPTION>
AMOUNT AND NATURE PERCENT
OF BENEFICIAL OF
NAME OWNERSHIP(A) CLASS(A)
<S> <C> <C>
R. R. Clayton 79,767(b)(c) --
N. J. Darling, Jr. 2,800(d)(e)(f) --
W. J. Flaherty 16,507(b)(c) --
S. Frankenheim 2,400(d)(f) --
D. W. Freed 1,100(d) --
R. P. Henderson 1,624(d)(f) --
J. A. Ives 130,139(b)(g) --
L. R. Jaskol 1,000 --
T. W. Jones 500(d)(f) --
C. R. Messer 34,539(b)(c) --
H. T. Miller 1,400(d) --
W. J. Pruyn 25,100(d)(g) --
F. C. Raskin 24,476(b)(c) --
W. G. Salatich 4,800(d) --
R. K. Spence 700(d) --
L. E. Thompson 3,464(d)(g) --
Trustees and Executive Officers as a Group
(18 persons) 353,860(b)(c)(d)(e)(f)(g) 1.7%
<FN>
- ---------------
(a) Except as noted, each Trustee, nominee and executive officer has sole voting
and investment power over the shares owned. No Trustee, nominee or executive
officer individually owns 1% or more of the outstanding Common Stock of the
Association.
(b) Figures include the following shares which executive officers have the right
to acquire on or before April 26, 1994 through the exercise of employee
stock options: Mr. Ives, 100,000; Mr. Clayton, 59,080; Mr. Messer, 20,400;
Mr. Raskin, 11,040; Mr. Flaherty, 6,860; and Trustees and executive officers
as a group, 209,100.
(c) Figures include the following restricted shares held by executive officers
that were awarded under 1992 Restricted Stock Plan: Mr. Clayton, 6,000; Mr.
Messer, 3,000; Mr. Raskin, 3,000; Mr. Flaherty, 3,000; and Trustees and
executive officers as a group, 19,200.
(d) Figures for Messrs. Darling, Frankenheim, Freed, Henderson, Jones, Miller,
Pruyn, Salatich and Thompson and Ms. Spence each include 400 restricted
shares awarded under Restricted Stock Plan for Non-Employee Trustees, and
figure for Trustees and executive officers as a group includes 4,000 such
shares.
(e) 600 of such shares are held in a revocable trust of which Mr. Darling is the
settlor and a trustee and beneficiary and 1,800 of such shares are held in
an irrevocable trust of which he is a trustee and beneficiary. He shares
voting and investment power over such shares.
(f) Figures do not include the following Share Units held under the Deferred
Compensation Plan for Trustees: Mr. Darling, 21,954; Mr. Frankenheim, 1,176;
Mr. Henderson, 645; and Mr. Jones, 1,291.
(g) Figures include the following shares owned by spouse or held by spouse as
custodian for minor children: Mr. Ives, 4,000; Mr. Pruyn, 16,000; and Mr.
Thompson, 743.
</TABLE>
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<PAGE> 10
<TABLE>
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth certain information concerning the
compensation of the Association's chief executive officer and its four most
highly compensated other executive officers (the "Named Executive Officers")
with respect to the Association's last three completed fiscal years:
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG TERM COMPENSATION
---------------------------------------
AWARDS PAYOUTS
------------------------- ----------
ANNUAL SECURITIES
COMPENSATION RESTRICTED UNDERLYING
----------------- STOCK OPTIONS/ LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS(A) AWARDS(B) SARS PAYOUTS(C) COMPENSATION(D)
POSITION YEAR ($) ($) ($) (#) ($) ($)
------------------ ---- ------ -------- ----------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
J. Atwood Ives 1993 633,983 143,100 -- -- -- 2,249
Chairman and Chief 1992 600,000 144,000 -- -- -- 2,182
Executive Officer 1991(e) 81,986 -- -- 250,000 --
Richard R. Clayton 1993 439,833 86,190 -- -- -- 2,249
President and Chief 1992 414,667 93,600 276,250 -- -- 2,182
Operating Officer 1991 391,411 -- -- 5,100 243,000
Chester R. Messer 1993 256,475 109,708 -- -- -- 2,249
Senior Vice 1992 242,083 89,443 138,125 -- 48,203 1,523
President;
President of Boston 1991 230,731 -- -- 3,000 204,000
Gas Company
Fred C. Raskin 1993 268,475 38,769 -- -- -- 2,249
Senior Vice 1992 253,750 43,350 138,125 -- 49,223 2,182
President;
President of Midland 1991(f) 237,500 -- -- 3,300 123,000
Enterprises Inc.
Walter J. Flaherty 1993 215,583 37,975 -- -- -- 2,249
Senior Vice President 1992 198,500 30,000 138,125 -- 17,800 2,182
and Chief Financial 1991(f) 172,312 -- -- 1,700 61,000
Officer
<FN>
- ---------------
(a) Amounts shown represent awards for 1992, paid in 1993, and awards for 1993,
paid in 1994, under the Association's Executive Incentive Compensation
Plan, which in each case were paid 50% in cash and 50% in shares of the
Association's Common Stock. For the purpose of this table, the stock
portion of each award is valued based on the fair market value of such
shares at the time of award.
(b) Amounts shown represent awards of restricted shares of the Association's
Common Stock under its 1992 Restricted Stock Plan. For the purpose of this
table, such awards have been valued based on the closing price of the
Association's Common Stock on the New York Stock Exchange (the "Closing
Price") on January 2, 1992, the date of grant. The numbers of restricted
shares of Common Stock awarded on such date were as follows: R. R. Clayton,
10,000 shares; C. R. Messer, 5,000 shares; F. C. Raskin, 5,000 shares; and
W. J. Flaherty, 5,000 shares. In each case, such shares vest at the rate of
20% per year, commencing January 2, 1993. As of December 31, 1993, the
numbers and values (based on the Closing Price on such date) of restricted
shares of Common Stock held are as follows: R. R. Clayton, 8,000 shares,
$204,000; C. R. Messer, 4,000 shares, $102,000; F. C. Raskin, 4,000 shares,
$102,000; and W. J. Flaherty, 4,000 shares, $102,000. Dividends on
restricted shares are paid directly to the holders.
</TABLE>
8
<PAGE> 11
(c) Amounts shown for 1992 represent payment of awards for the 1989-1991 Plan
Period under the Association's Executive Incentive Compensation Plan, which
were paid 70% in shares of the Association's Common Stock and 30% in cash.
Amounts shown for 1991 represent payment of awards for the 1988-1990 Plan
Period under such Plan, which were also paid 70% in shares of the
Association's Common Stock and 30% in cash. For the purpose of this table,
the stock portion of each award is valued based on the fair market value of
such shares at the time of award.
(d) Amounts shown represent employer contributions under the Retirement Savings
(401k) Plan.
(e) J. A. Ives was appointed Chairman and Chief Executive Officer of the
Association effective December 1, 1991. His fees for serving on the Board
of Trustees and committees thereof prior to such date during 1991 are
included in the 1991 salary figure shown.
(f) F. C. Raskin became an executive officer of the Association on April 25,
1991, and W. J. Flaherty became an executive officer of the Association on
May 23, 1991. Amounts shown for 1991 reflect their compensation for the
entire year.
<TABLE>
The following table sets forth certain information as to the number and
value of outstanding options and stock appreciation rights ("SARs") in tandem
with options, as of December 31, 1993, held by Named Executive Officers under
the Association's 1982 Stock Option Plan (no options or SARs were granted to or
exercised by any such officer during 1993):
YEAR-END OPTION/SAR VALUES
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/SARS AT IN-THE-MONEY OPTIONS/SARS
12/31/93 AT 12/31/93 (A)
--------------------------- -------------------------
NAME EXERCISABLE/NON-EXERCISABLE EXERCISABLE/NON-EXERCISABLE
---- --------------------------- -------------------------
<S> <C> <C>
J. Atwood Ives 100,000/150,000(b) 0/0
Richard R. Clayton 58,060/2,040(c) $124,100/0(c)
Chester R. Messer 19,800/1,200(c) 58,230/0(c)
Fred C. Raskin 10,380/1,320(c) 9,144/0(c)
Walter J. Flaherty 6,520/680(c) 5,715/0(c)
<FN>
- ---------------
(a) All values are based on Closing Price as of December 31, 1993.
(b) Figures represent options without SARs. No SARs have been granted to J. A.
Ives.
(c) Figures represent options, including those with and those without tandem
SARs. In each case, tandem SARs were granted in an amount equal to one-half
of the related options, and are exercisable in lieu of, and not in addition
to, such portion of the related option.
</TABLE>
9
<PAGE> 12
<TABLE>
The following table sets forth estimated annual benefits payable upon
retirement in specified compensation and years of service categories under
qualified retirement plans maintained for salaried employees of the Association
and certain subsidiaries (the "Retirement Plans") and the Association's
non-qualified Supplemental Executive Retirement Plan (the "SERP") maintained for
all executive officers and certain other officers of the Association and its
subsidiaries:
PENSION PLAN TABLE
<CAPTION>
ESTIMATED ANNUAL RETIREMENT BENEFITS
BASED ON YEARS OF SERVICE(B)
------------------------------------------------------------
REMUNERATION(A) 15 20 25 30 35
<S> <C> <C> <C> <C> <C>
$100,000 $ 42,500 $ 50,000 $ 50,000 $ 50,000 $ 50,000
200,000 85,000 100,000 100,000 100,000 100,000
300,000 127,500 150,000 150,000 150,000 150,000
400,000 170,000 200,000 200,000 200,000 200,000
500,000 212,500 250,000 250,000 250,000 250,000
600,000 255,000 300,000 300,000 300,000 300,000
700,000 297,500 350,000 350,000 350,000 350,000
800,000 340,000 365,000 365,000 365,000 365,000
<FN>
- ---------------
(a) The compensation covered by the Retirement Plans and the SERP is the average
annual compensation (whether or not deferred under deferred compensation or
savings plan) for the highest five years in the ten years preceding
retirement, based on the annual salary rate plus one-half of bonuses and
incentive awards earned (whether payable in cash or stock), not including
any amounts with respect to options, SARs or restricted stock awards.
(b) The benefits set forth in these columns assume that the participant elects a
straight life annuity with five years certain. Such benefits are shown
before deductions for 50% of Social Security benefits and other applicable
offsets. In general, Federal law limits the annual benefit payable under the
Retirement Plans to a participant at age 65, calculated in the form of a
life annuity (with no period certain), to a specified amount ($118,800,
adjusted as of January 1, 1994). Not being subject to limitations imposed on
the Retirement Plans by Federal law, the SERP provides for annual benefits
equal to up to one-half of covered compensation, provided that annual
benefits under the SERP, before offset for annual benefits received under
any other retirement plan, may not exceed three times the $118,800 limit, as
such limit may from time to time be increased. Years of service credited
under the Retirement Plans and years of service as an officer credited under
the SERP through 1993 for the Named Executive Officers were as follows: J.
A. Ives, 6 and 6; R. R. Clayton, 13 and 13; C. R. Messer, 30 and 17; F. C.
Raskin, 16 and 15; and W. J. Flaherty, 22 and 10. Years of service for J. A.
Ives and R. R. Clayton are determined in accordance with their employment
agreements described on page 12 hereof. Years of service under the SERP for
F. C. Raskin, C. R. Messer and W. J. Flaherty equal years of service as an
officer of the Association or a subsidiary.
</TABLE>
COMPENSATION OF TRUSTEES
During the period January 1, 1993 to April 1, 1993, each Trustee of the
Association who was not an officer of the Association received cash retainer
fees at an annual rate of $16,000. Commencing April 1, 1993, in connection with
adoption of the Restricted Stock Plan for Non-Employee Trustees, the annual rate
of such cash retainer fees was reduced to $10,000. Each such Trustee who was a
member of the Executive, Audit, Compensation or Nominating Committee received an
additional annual retainer fee of $1,200 for each committee of which he or she
was a member. The Chairman of each of the Audit, Compensation and
10
<PAGE> 13
Nominating Committees, in addition to the committee membership retainer fee,
received an annual retainer fee of $4,000. In addition, each such non-officer
Trustee received $1,000 for each meeting session of the Board of Trustees and
each standing committee meeting session he or she attended. In addition to fees
described above, W. J. Pruyn received consulting fees of $100,000 per year under
a two-year consulting agreement, which ended April 30, 1993.
The Restricted Stock Plan for Non-Employee Trustees provides for
supplemental retainer fees in the form of five annual grants of restricted
shares of the Association's Common Stock, each in the amount of 400 shares, to
each Trustee who at the time of grant serves as a Trustee but is not an employee
of the Association or any of its subsidiaries. Initial grants under such Plan
were made on April 22, 1993 to each Trustee other than J.A. Ives, R.R. Clayton
and L.R. Jaskol (who was first elected to the Board on February 24, 1994).
Subsequent grants will be made on the first day of June in the years 1994, 1995,
1996 and 1997. All shares granted under such Plan are non-transferable and
subject to forfeiture while the recipient serves on the Board of Trustees. In
the event that he or she resigns or declines to stand for re-election to the
Board, not due to disability and not in accordance with a retirement policy of
the Board then in effect, all shares granted to him or her under the Plan shall
be forfeited. Dividends on restricted shares granted under the Plan are paid
directly to the Trustee.
The Association maintains a Retirement Plan for Non-Employee Trustees who
have served in that capacity for at least ten years pursuant to which each such
Trustee will receive annual retirement benefits for the number of years such
Trustee served (with ten years certain) equal to his or her average annual
retainer fees (including the value of one-half the number of shares awarded
under the Restricted Stock Plan for Non-Employee Trustees) for the highest five
years in the ten years preceding retirement. The Trustees who currently have ten
years of service under such Plan are R. P. Henderson, N. J. Darling, D. W.
Freed, H. T. Miller, W. G. Salatich and L. E. Thompson.
The Association maintains a Deferred Compensation Plan for Trustees under
which Trustees' cash fees may be deferred at the election of participants.
Participants may elect to credit amounts deferred to a Cash Account or to a
Share Unit Account. Interest based on the prime rate is credited to Cash
Accounts at the end of each calendar year. Amounts credited to Share Unit
Accounts are converted to Share Units based on the fair market value of the
Association's Common Stock on the deferral date. Additional Share Units are
credited to reflect dividends on shares of such stock. The balance in a
participant's Cash Account and Share Unit Account will be paid to him or her, or
to his or her beneficiary, in cash only, in a lump sum or installments when he
or she ceases to be a Trustee, or if he or she experiences serious financial
hardship.
Samuel Frankenheim, a Trustee of the Association, is counsel to Ropes &
Gray, a Boston law firm which provided legal services to the Association and its
subsidiaries during 1993, and which is expected to provide legal services to
them during 1994. Fees paid for such services during 1993 were less than 5% of
such firm's 1993 gross revenues.
TERMINATION OF
EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS
The Association has entered into Salary Continuation Agreements with
certain officers of the Association (currently ten persons) under which, if the
employment of any such officer terminates following a Change of Control, the
officer would be entitled to receive annually income equal to the salary rate in
effect at the time of the Change of Control plus the annual average of all cash
bonuses and awards granted during the previous thirty-six month period together
with continuation of certain of the Association's medical and other benefits.
Subject to certain limitations, such income and benefits for the Chairman,
President and Senior Vice Presidents of the Association would continue for
thirty-six months, but not beyond the date which follows by forty-eight months
the Change of Control. For other officers with such agreements, income and
benefits would continue
11
<PAGE> 14
for eighteen months, but not beyond the date which follows by thirty months the
Change of Control. For purposes of the Agreements, a "Change of Control" is
deemed to occur if (i) a person or entity or a group acting together becomes a
beneficial owner of securities representing 25 percent or more of the
outstanding voting securities of the Association or (ii) within two years after
the commencement of a tender offer or exchange offer for the voting securities
of the Association, or as a result of a merger, consolidation, sale of assets or
contested election, the individuals who were Trustees of the Association
immediately prior thereto shall cease to constitute a majority of the Board of
Trustees of the Association or of the board of trustees or directors of its
successor. Such Agreements with Messrs. Ives, Clayton, Messer, Raskin and
Flaherty call for income payable over thirty-six months, subject to the
forty-eight month limitation. The current annual income amounts applicable to
them are $683,850, $471,965, $316,312, $293,609 and $245,609, respectively.
The Association has also entered into an employment agreement with Mr. Ives
dated November 27, 1991, and an employment agreement with Mr. Clayton dated
October 25, 1991, under which, if the employment of either such officer is
terminated by the Association otherwise than for Cause (as defined in such
agreements, generally including malfeasance or misfeasance), or by the officer
for Good Reason (as defined in such agreements, generally including diminishment
of authority, responsibility, or cash compensation opportunities), whether or
not following a Change of Control, he will be entitled to receive income equal
to the salary rate in effect at the time of such termination, together with
continuation of certain medical and other benefits. Subject to certain
limitations, such income and benefits would continue for thirty-six months in
the case of Mr. Ives and twenty-four months in the case of Mr. Clayton. If such
termination occurs after a Change of Control and the Salary Continuation
Agreements also apply, the officer may elect the salary continuation or other
benefit provisions contained in his Salary Continuation Agreement or the
employment agreement referred to in this paragraph, but shall not be entitled to
a duplication of any such benefit under both agreements. Mr. Ives' employment
agreement established his initial salary rate at $600,000 per year, subject to
review and adjustment by the Compensation Committee. In addition, under such
employment agreements, Mr. Ives will be credited with five years of service
under the Association's Retirement Plan and SERP for his first year of
employment and one and one-half years of service for each year of employment
thereafter, and Mr. Clayton will be credited with one and one-half years of
service for each year of employment, plus four years, under such Plans.
The Association has established a trust to make supplemental retirement
benefit payments to certain officers of the Association and its subsidiaries
under the Association's SERP and retirement benefit payments to Trustees under
the Association's Retirement Plan for Non-Employee Trustees, and makes
contributions to such trust from time to time. Such Plans provide that upon a
Change of Control (as defined above), the Association will fully fund such trust
by depositing therein sufficient funds to pay all benefits to those who have
retired prior to the Change of Control plus all benefits that would be payable
if all eligible officers and Trustees had retired prior thereto. It is the
Association's practice to make contributions to such trust from time to time as
necessary to maintain funds of at least $1.5 million therein.
12
<PAGE> 15
COMPENSATION COMMITTEE REPORT
The duties of the Compensation Committee include approval of the salary and
other compensation arrangements of the officers of the Association and its
subsidiaries, and administration of the Association's incentive and stock plans,
including the Executive Incentive Compensation Plan.
EXECUTIVE OFFICER COMPENSATION
The Committee's policy with respect to approving 1993 executive officer
compensation was to establish base salaries and annual incentive compensation
opportunities which, in the judgment of the Committee, were appropriate to
provide fair compensation, to enable the Association to attract and retain
executives with abilities and experience necessary to implement the
Associations's objectives, and to create incentives for high levels of
individual performance, consistent with the best interests of the Association.
The Committee's judgment was based on an assessment of each executive officer's
current and past performance, his or her business experience and level of
responsibilities, information concerning compensation paid to executive officers
at similarly-sized companies, annual compensation increases at such companies
and recommendations and advice from the Association's CEO concerning
compensation levels for other officers. The Committee's decisions were not based
on any established formulas with respect to weighting of the foregoing factors
or the affect of any particular factor on the total salary and incentive
opportunity for any executive officer. Information concerning compensation
levels at similarly-sized companies consisted of data provided by Hewitt
Associates, a management consulting firm, concerning salary, bonus, long-term
incentives, total compensation and year-to-year compensation increases for
executive officers of companies having levels of total revenues approximately
the same as that of the Association. Data provided by Hewitt was based on a
number of surveys covering a large number of companies representing a broad
cross-section of U.S. industries. Such data indicates that 1993 total
compensation for Eastern's executive officers, including its CEO, was below
average levels of total compensation for similar positions at such
similarly-sized companies.
It was the Committee's judgment in establishing 1993 compensation for
executive officers, and has been its policy since 1992, (i) that more senior
executive officers should receive a larger portion of their total compensation
in the form of annual incentive awards than less senior executive officers; (ii)
that appropriate maximum potential incentive awards for executive officers,
expressed as a percentage of salary, are 60%, 50% and 35%; and (iii) that it is
appropriate to base half of incentive compensation opportunities on financial
performance of the Association and half on individual performance. In accordance
with such policy, the Committee approved 1993 award opportunities under the
Association's Executive Incentive Compensation Plan equal to up to 60% (in the
case of Messrs. Ives and Clayton) or 50% or 35% (in the case of other executive
officers) of individual salaries. Such award opportunities could be earned based
(i) 50% on the achievement of specified pre-tax income performance goals by the
Association or, in the case of executive officers who are subsidiary presidents,
by the subsidiary, and (ii) 50% on the achievement of individual management
objectives established for each executive officer. Each award opportunity
provided that none of the portion based on financial performance would be earned
if minimum pre-tax income goals were not achieved, and that the portion based on
achievement of individual management objectives could be earned without regard
to financial performance. Because the 1993 pre-tax income performance goals for
the Association and its subsidiaries were not achieved, 1993 incentive award
payments to executive officers were based only on achievement of individual
management objectives. The extent to which each executive officer (other than
the CEO) achieved his management objectives was determined by the Committee
based upon recommendations of the CEO.
CEO COMPENSATION
Mr. Ives' base salary of $636,000, in effect since February 1, 1993, was
determined based on an increase in the salary provided for in his employment
agreement with the Association, described in the Association's proxy statement.
Such employment agreement provided for an initial base salary of $600,000,
effective
13
<PAGE> 16
December 1, 1991, with such adjustments as the Compensation Committee shall
approve from time to time. Effective February 1, 1993, the Compensation
Committee increased Mr. Ives' base salary to $636,000 in accordance with the
policies and considerations described above. In addition, Mr. Ives was granted
an incentive award opportunity in 1993 under the Association's Executive
Incentive Compensation Plan, as described above. Up to fifty percent of his
award under such Plan could be earned only if the Association achieved the
specified pre-tax income levels for 1993, and up to fifty percent could be
earned based on the achievement by Mr. Ives of management objectives approved
for him by the Compensation Committee. The first such management objective was
to identify and evaluate opportunities that would enhance shareholder value and
make the most productive use of the Association's capital resources. Meeting
this objective would involve (i) a continuing evaluation of the Association's
corporate structure, as well as an ongoing assessment of each of the
Association's business units as to whether they should be managed for growth,
cash generation, or sale; (ii) identification, assessment and recommendation of
new business opportunities which fit the Association's strategic objectives;
(iii) an ongoing assessment, at the subsidiary level, of tactical plans and
long-term strategies for each subsidiary and implementation of change where
appropriate; and (iv) allocation of available resources to those existing or new
businesses that can earn a rate of return consistent with stated financial
objectives. A second objective for Mr. Ives in 1993 under the incentive program
was to evaluate the capital structure of the Association and its principal
subsidiaries and to make changes as appropriate consistent with business plan
objectives, maintenance of stated debt ratings and enhancement of shareholder
value. The final objective for Mr. Ives under the 1993 incentive program was to
evaluate on an ongoing basis all corporate officers and, in conjunction with the
Chief Operating Officer, all senior subsidiary officers, and to implement
appropriate management development and succession plans to assure that the
Association and its subsidiaries are staffed with competent managers, such
development and succession plans to include programs that will enhance
professional development and diversity and encourage adherence to high ethical
standards.
Because the Association's consolidated pre-tax income performance for 1993
did not reach the established minimum goal, Mr. Ives did not receive any payment
under the financial performance portion of his award opportunity. The Committee,
after consultation with the other members of the Board of Trustees, determined
that Mr. Ives' overall achievement of his 1993 management objectives equalled
75% of the maximum potential achievement, and that Mr. Ives was therefore
entitled to an award of $143,100, or 37.5% of the maximum potential award for
1993 under the Executive Incentive Compensation Plan. Under the terms of the
1993 incentive program, fifty percent of such award was paid in cash and fifty
percent was paid in shares of the Association's Common Stock.
The Revenue Reconciliation Act of 1993 disallows tax deductions for certain
compensation paid by a company to its chief executive officer and four other
executive officers named in its proxy statement, to the extent such compensation
in any tax year beginning on or after January 1, 1994 exceeds $1 million. The
Committee does not anticipate that such Act will affect deductibility of any
compensation paid to the Association's executive officers for 1994. With respect
to Mr. Ives in particular, the salary component of his total compensation will
be exempt from such $1 million limitation because it is paid pursuant to a
written binding agreement executed prior to February 17, 1993.
No member of the Compensation Committee is a current or former officer or
employee of the Association or any of its subsidiaries.
Respectfully submitted,
COMPENSATION COMMITTEE MEMBERS
William G. Salatich, Chairman
Robert P. Henderson
Harold T. Miller
Rina K. Spence
14
<PAGE> 17
<TABLE>
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on the
Association's Common Stock to the cumulative total return of the S&P 500 Index
and the S&P Natural Gas Index over a five year period ending December 31, 1993
(a similar comparison to the S&P Conglomerates Index is also provided):
COMPARISON OF FIVE YEAR
CUMULATIVE TOTAL RETURNS(A)(B)
<CAPTION>
MEASUREMENT PERIOD EASTERN ENTER- S&P NATURAL GAS S&P CONGLOMERAT
(FISCAL YEAR COVERED) PRISES S&P 500 INDEX INDEX ES INDEX
<S> <C> <C> <C> <C>
1988 $100 $100 $100 $100
1989 158 132 155 125
1990 130 127 136 104
1991 141 166 118 113
1992 145 179 131 140
1993 142 197 155 185
- ---------------
<FN>
(a) Based on an initial investment of $100 with dividends reinvested quarterly.
(b) The Association has selected the S&P Natural Gas Index as an appropriate
published industry index for purposes of this graph. The natural gas
operations of Boston Gas Company represent 60% of the Association's
consolidated net assets at December 31, 1993 and 56% of 1993 consolidated
revenues, and the Association is included among the companies that make up
the S&P Natural Gas Index. Supplemental disclosure concerning the S&P
Conglomerates Index, provided above and in last year's performance graph,
will not be provided in future performance graphs because such index is
comprised primarily of multi-billion dollar companies engaged in
manufacturing operations which are unrelated to the Association's
service-oriented lines of business.
</TABLE>
INDEPENDENT AUDITORS
The firm of Arthur Andersen & Co. has been selected by the Board of
Trustees to act as independent auditors of the Association and its subsidiaries
for the year 1994. The Association has been advised by such firm that neither it
nor any member thereof has any financial interest in or financial relationship
with the Association or its subsidiaries. Representatives of Arthur Andersen &
Co. are expected to be present at the
15
<PAGE> 18
1994 Annual Meeting with the opportunity to make a statement if they desire to
do so and to be available to respond to appropriate questions.
EXPENSES OF SOLICITATION
The expenses of making this solicitation will be paid by the Association,
which may solicit proxies by mail, telephone, telegraph or personal interview.
In addition, the Association has retained the firm of Morrow & Co. to aid in
such solicitation of proxies. For such services, the Association expects to pay
such firm a fee of $7,500 plus expenses. The Association will reimburse banks,
brokerage firms and other custodians, nominees and fiduciaries for reasonable
expenses incurred in sending proxy materials to beneficial owners.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1995 Annual Meeting
of Shareholders must be received at the Association's principal executive
offices no later than November 15, 1994.
OTHER MATTERS
If sufficient votes in favor of any of the proposals set forth in the
attached Notice of Annual Meeting of Shareholders are not received by the time
scheduled for the meeting, the persons named as proxies may propose one or more
adjournments of the meeting for a period or periods of not more than 30 days in
the aggregate to permit further solicitation of proxies with respect to any of
such proposals. Any adjournment will require the affirmative vote of a majority
of the votes cast on the question in person or by proxy at the session of the
meeting to be adjourned. The persons named as proxies will vote in favor of
adjournment with respect to any proposal those proxies which they are entitled
to vote in favor of such proposal. They will vote against adjournment with
respect to any proposal those proxies required to be voted against such
proposal. The Association will pay the costs of any additional solicitation and
of any adjourned session.
The Board of Trustees does not know of any business to be presented for
action by the shareholders in addition to those items appearing in the notice of
the meeting. However, if any additional matters properly come before the
meeting, or any adjournment thereof, it is the intention of the persons named in
the enclosed form of proxy to vote said proxy in accordance with their judgment
in such matters unless instructed to the contrary.
Reference is hereby made to the Declaration of Trust establishing Eastern
Enterprises dated July 18, 1929, as amended, a copy of which is on file in the
office of the Secretary of The Commonwealth of Massachusetts. The name "Eastern
Enterprises" refers to the Trustees under said declaration as Trustees and not
personally; and no Trustee, shareholder, officer or agent of Eastern Enterprises
shall be held to any personal liability in connection with the affairs of said
Eastern Enterprises, but the trust estate only is liable.
EASTERN ENTERPRISES
March 15, 1994
16
<PAGE> 19
<TABLE>
<S> <C>
- --------------------------------------------- ---------------------------------------------------------------------
1. Election of Trustees 2. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the meeting
For /x/ Withhold /x/ Exceptions* /x/ or any adjournment thereof.
*Exceptions ................................. ---------------------------------------------------------------------
- ---------------------------------------------
Nominnees: Richard R. Clayton, Leonard R. Jaskol,
Harold T. Miller and William G. Salatich. To vote
your shares for all such nominees, mark the "For"
box above. To withhold authority to vote for all
nominees, mark the "Wihhold" box. To vote for all
but a particular nomineee or nominees, mark the
"Exceptions" box and enter the name(s) of the
nominee(s) as to whom authority to vote is withheld
in the space provided. You may direct the manner
of distributing your votes for the election of ---------------------------------------------------------------------
Trustees by affixing instructions to this proxy. If you have noted an address change, mark here: /x/
THE BOARD OF TRUSTEES RECOMMENDS THAT YOU VOTE
"FOR" ELECTION OF THE NOMINEES LISTED ABOVE. ---------------------------------------------------------------------
PROXY DEPARTMENT
NEW YORK, N.Y. 10203-0489
Please sign exactly as name or names appear on this proxy. If
stock is held jointly, each holder should sign. If signing as
attorney, trustee, executor, administrator, custodian,
guardian, or corporate officer, please give full title.
DATED __________________________________________________, 1994
SIGNED _______________________________________________________
______________________________________________________________
Please indicate your choice by marking an "X"
in either Black or Blue ink as in this example /x/
Sign, Date and Return the Proxy Card Promptly
Using the Enclosed Envelope.
</TABLE>
EASTERN
ENTERPRISES PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
FOR ANNUAL MEETING, APRIL 28, 1994
I (We) hereby appoint J. A. Ives and R. R. Clayton and each of
them as proxies, with full power of substitution to each, to act and
vote in the name of the undersigned with all the powers that the
undersigned would possess if personally present, on all matters,
including the election of Trustees, which may come before the April
28, 1994 Annual Meeting of the Shareholders of Eastern Enterprises and
any adjournment of such meeting.
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICE BY MARKING THE
APPROPRIATE BOX, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOX IF
YOUR WISH TO VOTE IN ACCORDANCE WITH THE BOARD OF TRUSTEES'
RECOMMENDATION. THIS PROXY WHEN PROPERLY EXECUTED AND PRESENTED WILL
BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ELECTION OF THE
TRUSTEE NOMINEES LISTED ON THE REVERSE SIDE.
Continued and to be signed and dated on the reverse side.
