SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(dd) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
Commission file number 1-3004
Illinois Power Company
Incentive Savings Plan
for Employees Covered Under a
Collective Bargaining Agreement
(Full title of the plan)
Illinova Corporation
500 South 27th Street
Decatur, Illinois 62525
(Name of issuer of the securities held
pursuant to the plan and the address
of its principal executive office.)
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN
FOR EMPLOYEES COVERED UNDER A
COLLECTIVE BARGAINING AGREEMENT
FINANCIAL STATEMENTS
AND ADDITIONAL INFORMATION
DECEMBER 31, 1996
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN
FOR EMPLOYEES COVERED UNDER A
COLLECTIVE BARGAINING AGREEMENT
Index to Financial Statements and Additional Information
Financial Statements: Page
Report of Independent Accountants 1
Statement of Net Assets Available for Benefits
with fund information as of December 31, 1996
and 1995 2-12
Statement of Changes in Net Assets Available
for Benefits with fund information for the
years ended December 31, 1996 and 1995 13-24
Notes to Financial Statements 25-31
Additional Information:
Schedule I - Schedule of Assets Held for Investment Purposes
Schedule II - Schedule of Reportable Transactions
Note: Other schedules required by section 2520.10310 of the
Department of Labor Rules and Regulations for Reporting
and Disclosure under ERISA have been omitted because
they are not applicable.
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1996
<C> <C> <C>
Illinova Equity
Stock Income
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $251,748 $0
Investments at Fair Value 22,811,497 16,154,296
----------- -----------
Total Investments 23,063,245 16,154,296
Dividends and Interest Receivable 1,119 0
Employee Contributions Receivable 3,456 73,280
Employer Contributions Receivable 1,264,346 0
Loan Repayments Receivable 1,114 20,216
Loans Outstanding 0 0
----------- -----------
Other Assets 1,270,035 93,496
----------- -----------
Total Assets 24,333,280 16,247,792
----------- -----------
LIABILITIES:
Accrued Expenses 66,855 0
----------- -----------
Total Liabilities 66,855 0
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $24,266,425 $16,247,792
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31,1996
<C> <C> <C>
Retirement
Growth Loan
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 18,349,277 0
----------- ----------
Total Investments 18,349,277 0
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 82,578 0
Employer Contributions Receivable 0 0
Loan Repayments Receivable 21,323 (60,935)
Loans Outstanding 0 2,805,579
----------- ---------
Other Assets 103,901 2,744,644
------------ ---------
Total Assets 18,453,178 2,744,644
----------- ----------
LIABILITIES:
Accrued Expenses 0 0
----------- ----------
Total Liabilities 0 0
----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $18,453,178 $2,744,644
=========== ==========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1996
<C> <C> <C>
Asset Asset
Manager Manager
Income Growth
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 302,753 2,397,751
---------- ----------
Total Investments 302,753 2,397,751
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 2,503 14,476
Employer Contributions Receivable 0 0
Loan Repayments Receivable 403 2,383
Loans Outstanding 0 0
---------- -----------
Other Assets 2,906 16,859
---------- ----------
Total Assets 305,659 2,414,610
---------- -----------
LIABILITIES:
Accrued Expenses 0 0
---------- ---------
Total Liabilities 0 0
---------- ---------
NET ASSETS AVAILABLE FOR BENEFITS $305,659 $2,414,610
========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1996
<C> <C> <C>
Asset
Manager International
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 3,438,571 1,469,320
----------- ---------
Total Investments 3,438,571 1,469,320
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 16,826 10,094
Employer Contributions Receivable 0 0
Loan Repayments Receivable 2,650 2,458
Loans Outstanding 0 0
----------- ----------
Other Assets 19,476 12,552
----------- ----------
Total Assets 3,458,047 1,481,872
----------- ----------
LIABILITIES:
Accrued Expenses 0 0
----------- ----------
Total Liabilities 0 0
----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $3,458,047 $1,481,872
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1996
<C> <C> <C>
Managed
Income
Portfolio Total All
Fund Funds
ASSETS:
Cash and Temporary Cash Investments $0 $251,748
Investments at Fair Value 10,955,488 75,878,953
---------- ----------
Total Investments 10,955,488 76,130,701
Dividends and Interest Receivable 0 1,119
Employee Contributions Receivable 34,734 237,947
Employer Contributions Receivable 0 1,264,346
Loan Repayments Receivable 10,388 0
Loans Outstanding 0 2,805,579
----------- -----------
Other Assets 45,122 4,308,991
----------- -----------
Total Assets 11,000,610 80,439,692
----------- -----------
LIABILITIES:
Accrued Expenses 0 66,855
----------- -----------
Total Liabilities 0 66,855
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $11,000,610 $80,372,837
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED UNDER A
COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C> <C>
Guaranteed Illinova
Investment Stock
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $240,319
Investments at Fair Value 3,368,925 24,681,810
----------- -----------
Total Investments 3,368,925 24,922,129
Dividends and Interest Receivable 0 1,180
Employee Contributions Receivable 0 999
Employer Contributions Receivable 0 2,178,061
Loan Repayments Receivable 0 0
Loans Outstanding 0 0
----------- -----------
Other Assets 0 2,180,240
----------- -----------
Total Assets 3,368,925 27,102,369
----------- -----------
LIABILITIES:
Accrued Expenses 0 2,899
----------- -----------
Total Liabilities 0 2,899
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $3,368,925 $27,099,470
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C> <C>
Equity Retirement
Income Growth
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 12,724,309 17,061,240
----------- -----------
Total Investments 12,724,309 17,061,240
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 0 0
Employer Contributions Receivable 0 0
Loan Repayments Receivable 0 0
Loans Outstanding 0 0
----------- -----------
Other Assets 0 0
----------- -----------
Total Assets 12,724,309 17,061,240
----------- -----------
LIABILITIES:
Accrued Expenses 0 0
----------- -----------
Total Liabilities 0 0
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $12,724,309 $17,061,240
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C> <C>
Asset
Manager
Loan Income
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 0 273,524
----------- ----------
Total Investments 0 273,524
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 0 0
Employer Contributions Receivable 0 0
Loan Repayments Receivable 0 0
Loans Outstanding 2,257,400 0
----------- ----------
Other Assets 2,257,400 0
----------- ----------
Total Assets 2,257,400 273,524
----------- ----------
LIABILITIES:
Accrued Expenses 0 0
----------- ----------
Total Liabilities 0 0
----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $2,257,400 $273,524
=========== ==========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C> <C>
Asset
Manager Asset
Growth Manager
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 1,871,215 3,312,861
----------- -----------
Total Investments 1,871,215 3,312,861
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 0 0
Employer Contributions Receivable 0 0
Loan Repayments Receivable 0 0
Loans Outstanding 0 0
----------- -----------
Other Assets 0 0
----------- -----------
Total Assets 1,871,215 3,312,861
----------- -----------
LIABILITIES:
Accrued Expenses 0 0
----------- -----------
Total Liabilities 0 0
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $1,871,215 $3,312,861
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C> <C>
Managed
Income
International Portfolio
Fund Fund
ASSETS:
Cash and Temporary Cash Investments $0 $0
Investments at Fair Value 1,247,197 8,846,229
----------- ----------
Total Investments 1,247,197 8,846,229
Dividends and Interest Receivable 0 0
Employee Contributions Receivable 0 0
Employer Contributions Receivable 0 0
Loan Repayments Receivable 0 0
Loans Outstanding 0 0
----------- ----------
Other Assets 0 0
----------- ----------
Total Assets 1,247,197 8,846,229
----------- -----------
LIABILITIES:
Accrued Expenses 0 0
----------- -----------
Total Liabilities 0 0
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $1,247,197 $8,846,229
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Net Assets Available for Benefits
As of December 31, 1995
<C> <C>
Total All
Funds
ASSETS:
Cash and Temporary Cash Investments $240,319
Investments at Fair Value 73,387,310
----------
Total Investments 73,627,629
Dividends and Interest Receivable 1,180
Employee Contributions Receivable 999
Employer Contributions Receivable 2,178,061
Loan Repayments Receivable 0
Loans Outstanding 2,257,400
----------
Other Assets 4,437,640
----------
Total Assets 78,065,269
-----------
LIABILITIES:
Accrued Expenses 2,899
----------
Total Liabilities 2,899
----------
NET ASSETS AVAILABLE FOR BENEFITS $78,062,370
===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C> <C>
Guaranteed Illinova
Investment Stock
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $0 $90,279
Employer 0 2,382,672
Fund-to-Fund Transfers (2,981,245) (848,173)
Plan-to-Plan Transfers (8,632) (240,896)
Loan Repayments 0 26,373
---------- ---------
(2,989,877) 1,410,255
---------- ----------
Investment Income:
Dividend and Interest Income 70,766 948,221
Net Change in Fair Value of
Investments 0 (2,217,798)
---------- -----------
70,766 (1,269,577)
---------- -----------
Application of Participants' Equity:
Loans to Participants 38,495 50,774
Distributions to Active and
Terminated Participants 411,319 2,894,763
Administrative and Miscellaneous
Expenses 0 28,186
---------- -----------
449,814 2,973,723
---------- -----------
Increase (Decrease) in Net Assets
Available for Benefits (3,368,925) (2,833,045)
Net Assets Available for Benefits,
Beginning of Year 3,368,925 27,099,470
---------- ----------
Net Assets Available for Benefits,
End of Year $0 $24,266,425
========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C> <C>
Equity Retirement
Income Growth
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $1,611,289 $1,998,396
Employer 0 0
Fund-to-Fund Transfers 957,251 (146,654)
Plan-to-Plan Transfers (196,008) (131,997)
Loan Repayments 304,888 437,071
----------- ---------
2,677,420 2,156,816
----------- -----------
Investment Income:
Dividend and Interest Income 998,419 2,251,091
Net Change in Fair Value of
Investments 1,641,238 (850,496)
----------- -----------
2,639,657 1,400,595
----------- ----------
Application of Participants' Equity:
Loans to Participants 435,167 625,882
Distributions to Active and
Terminated Participants 1,353,351 1,538,229
Administrative and Miscellaneous
Expenses 5,076 1,362
----------- ---------
1,793,594 2,165,473
----------- -----------
Increase (Decrease) in Net Assets
Available for Benefits 3,523,483 1,391,938
Net Assets Available for Benefits,
Beginning of Year 12,724,309 17,061,240
----------- ----------
Net Assets Available for Benefits,
End of Year $16,247,792 $18,453,178
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C> <C>
Asset
Manager
Loan Income
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $0 $60,867
Employer 0 0
Fund-to-Fund Transfers 0 18,713
Plan-to-Plan Transfers (34,288) (1,766)
Loan Repayments (917,816) 7,933
----------- -----------
(952,104) 85,747
----------- -----------
Investment Income:
Dividend and Interest Income 0 20,552
Net Change in Fair Value of
Investments 0 367
----------- ----------
0 20,919
----------- ----------
Application of Participants' Equity:
Loans to Participants (1,631,328) 6,598
Distributions to Active and
Terminated Participants 191,924 67,933
Administrative and Miscellaneous
Expenses 56 0
----------- ---------
(1,439,348) 74,531
----------- ----------
Increase (Decrease) in Net Assets
Available for Benefits 487,244 32,135
Net Assets Available for Benefits,
Beginning of Year 2,257,400 273,524
----------- ----------
Net Assets Available for Benefits,
End of Year $2,744,644 $305,659
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C> <C>
Asset
Manager Asset
Growth Manager
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $331,775 $407,265
Employer 0 0
Fund-to-Fund Transfers 135,815 (118,016)
Plan-to-Plan Transfers (45,836) (50,856)
Loan Repayments 47,568 54,051
----------- -----------
469,322 292,444
----------- ----------
Investment Income:
Dividend and Interest Income 196,481 266,963
Net Change in Fair Value of
Investments 140,898 117,051
----------- -----------
337,379 384,014
----------- -----------
Application of Participants' Equity:
Loans to Participants 54,214 75,020
Distributions to Active and
Terminated Participants 209,046 456,167
Administrative and Miscellaneous
Expenses 46 85
----------- -----------
263,306 531,272
----------- -----------
Increase (Decrease) in Net Assets
Available for Benefits 543,395 145,186
Net Assets Available for Benefits,
Beginning of Year 1,871,215 3,312,861
----------- -----------
Net Assets Available for Benefits,
End of Year $2,414,610 $3,458,047
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C> <C>
Managed
Income
International Portfolio
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $238,051 $854,699
Employer 0 0
Fund-to-Fund Transfers 4,543 2,977,766
Plan-to-Plan Transfers (59,534) (69,683)
Loan Repayments 45,934 209,433
----------- ----------
228,994 3,972,215
----------- -----------
Investment Income:
Dividend and Interest Income 45,771 548,224
Net Change in Fair Value of
Investments 106,229 0
----------- ----------
152,000 548,224
----------- ----------
Application of Participants' Equity:
Loans to Participants 43,343 301,835
Distributions to Active and
Terminated Participants 102,845 2,055,631
Administrative and Miscellaneous
Expenses 131 8,592
----------- ----------
146,319 2,366,058
----------- ----------
Increase (Decrease) in Net Assets
Available for Benefits 234,675 2,154,381
Net Assets Available for Benefits,
Beginning of Year 1,247,197 8,846,229
----------- ----------
Net Assets Available for Benefits,
End of Year $1,481,872 $11,000,610
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1996
<C> <C>
Total All
Funds
Sources of Participants' Equity:
Contributions:
Employee $5,592,621
Employer 2,382,672
Fund-to-Fund Transfers 0
Plan-to-Plan Transfers (839,496)
Loan Repayments 215,435
----------
7,351,232
-----------
Investment Income:
Dividend and Interest Income 5,346,488
Net Change in Fair Value of
Investments (1,062,511)
----------
4,283,977
----------
Application of Participants' Equity:
Loans to Participants 0
Distributions to Active and
Terminated Participants 9,281,208
Administrative and Miscellaneous
Expenses 43,534
----------
9,324,742
----------
Increase (Decrease) in Net Assets
Available for Benefits 2,310,467
Net Assets Available for Benefits,
Beginning of Year 78,062,370
----------
Net Assets Available for Benefits,
End of Year $80,372,837
===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C> <C>
Guaranteed Illinova
Investment Stock
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $42 $93,387
Employer 0 3,507,436
Fund-to-Fund Transfers (309,160) (514,140)
Plan-to-Plan Transfers 6,871 36,800
Loan Repayments 5,112 21,966
----------- ---------
(297,135) 3,145,449
----------- ----------
Investment Income:
Dividend and Interest Income 202,031 744,712
Net Change in Fair Value of
Investments 0 6,205,085
----------- -----------
202,031 6,949,797
----------- -----------
Application of Participants' Equity:
Loans to Participants 80,456 23,855
Distributions to Active and
Terminated Participants 226,053 946,559
Administrative and Miscellaneous
Expenses (35) 22,379
----------- -----------
306,474 992,793
----------- -----------
Increase (Decrease) in Net Assets
Available for Benefits (401,578) 9,102,453
Net Assets Available for Benefits,
Beginning of Year 3,770,503 17,997,017
----------- -----------
Net Assets Available for Benefits,
End of Year $3,368,925 $27,099,470
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C> <C>
Equity Retirement
Income Growth
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $1,526,052 $2,089,783
Employer 0 0
Fund-to-Fund Transfers 608,929 340,774
Plan-to-Plan Transfers (107,546) (182,004)
Loan Repayments 154,016 243,698
----------- -----------
2,181,451 2,492,251
----------- -----------
Investment Income:
Dividend and Interest Income 702,890 1,621,533
Net Change in Fair Value of
Investments 2,176,701 1,496,345
----------- -----------
2,879,591 3,117,878
----------- -----------
Application of Participants' Equity:
Loans to Participants 274,275 472,381
Distributions to Active and
Terminated Participants 191,165 269,312
Administrative and Miscellaneous
Expenses 0 0
----------- -----------
465,440 741,693
----------- -----------
Increase (Decrease) in Net Assets
Available for Benefits 4,595,602 4,868,436
Net Assets Available for Benefits,
Beginning of Year 8,128,707 12,192,804
----------- ----------
Net Assets Available for Benefits,
End of Year $12,724,309 $17,061,240
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C> <C>
Asset
Manager
Loan Income
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $0 $75,273
Employer 0 0
Fund-to-Fund Transfers 25,797 31,121
Plan-to-Plan Transfers (34,644) 2,659
Loan Repayments (628,008) 7,408
----------- ----------
(636,855) 116,461
----------- ----------
Investment Income:
Dividend and Interest Income 136 10,774
Net Change in Fair Value of
Investments 0 20,504
----------- ----------
136 31,278
----------- ----------
Application of Participants' Equity:
Loans to Participants (1,359,082) 1,744
Distributions to Active and
Terminated Participants 3,747 3,451
Administrative and Miscellaneous
Expenses 0 0
----------- ----------
(1,355,335) 5,195
----------- ----------
Increase (Decrease) in Net Assets
Available for Benefits 718,616 142,544
Net Assets Available for Benefits,
Beginning of Year 1,538,784 130,980
----------- ---------
Net Assets Available for Benefits,
End of Year $2,257,400 $273,524
=========== ==========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C> <C>
Asset
Manager Asset
Growth Manager
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $378,428 $559,695
Employer 0 0
Fund-to-Fund Transfers (147,613) (103,000)
Plan-to-Plan Transfers (17,009) (23,195)
Loan Repayments 38,154 36,145
----------- ---------
251,960 469,645
----------- -----------
Investment Income:
Dividend and Interest Income 28,411 87,394
Net Change in Fair Value of
Investments 274,462 389,505
----------- ----------
302,873 476,899
----------- ----------
Application of Participants' Equity:
Loans to Participants 87,684 69,999
Distributions to Active and
Terminated Participants 43,303 118,999
Administrative and Miscellaneous
Expenses 0 0
----------- ---------
130,987 188,998
----------- ---------
Increase (Decrease) in Net Assets
Available for Benefits 423,846 757,546
Net Assets Available for Benefits,
Beginning of Year 1,447,369 2,555,315
----------- ----------
Net Assets Available for Benefits,
End of Year $1,871,215 $3,312,861
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C> <C>
Managed
Income
International Portfolio
Fund Fund
Sources of Participants' Equity:
Contributions:
Employee $313,191 $1,355,227
Employer 0 0
Fund-to-Fund Transfers (113,073) 180,365
Plan-to-Plan Transfers (18,334) 2,990
Loan Repayments 36,270 171,758
----------- -----------
218,054 1,710,340
----------- -----------
Investment Income:
Dividend and Interest Income 39,056 449,523
Net Change in Fair Value of
Investments 94,426 0
----------- -----------
133,482 449,523
----------- -----------
Application of Participants' Equity:
Loans to Participants 30,435 318,253
Distributions to Active and
Terminated Participants 12,448 475,923
Administrative and Miscellaneous
Expenses 0 0
----------- -----------
42,883 794,176
----------- -----------
Increase (Decrease) in Net Assets
Available for Benefits 308,653 1,365,687
Net Assets Available for Benefits,
Beginning of Year 938,544 7,480,542
----------- -----------
Net Assets Available for Benefits,
End of Year $1,247,197 $8,846,229
=========== ===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN FOR EMPLOYEES COVERED
UNDER A COLLECTIVE BARGAINING AGREEMENT
<TABLE>
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1995
<C> <C>
Total All
Funds
Sources of Participants' Equity:
Contributions:
Employee $6,391,078
Employer 3,507,436
Fund-to-Fund Transfers 0
Plan-to-Plan Transfers (333,412)
Loan Repayments 86,519
----------
9,651,621
-----------
Investment Income:
Dividend and Interest Income 3,886,460
Net Change in Fair Value of
Investments 10,657,028
----------
14,543,488
----------
Application of Participants' Equity:
Loans to Participants 0
Distributions to Active and
Terminated Participants 2,290,960
Administrative and Miscellaneous
Expenses 22,344
----------
2,313,304
----------
Increase (Decrease) in Net Assets
Available for Benefits 21,881,805
Net Assets Available for Benefits,
Beginning of Year 56,180,565
----------
Net Assets
Available for Benefits,
End of Year $78,062,370
===========
See Accompanying Notes to Financial Statements
</TABLE>
ILLINOIS POWER COMPANY
INCENTIVE SAVINGS PLAN
FOR EMPLOYEES COVERED UNDER A
COLLECTIVE BARGAINING AGREEMENT
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF PLAN:
General:
The Illinois Power Company Incentive Savings Plan for
Employees Covered Under a Collective Bargaining Agreement
(the Plan) is sponsored and administered by Illinois Power
Company (the Company). The Plan became effective as of
January 1, 1987. Assets of the Plan are held and managed by
a Trustee. For the first six months of 1995, the Trustee
was State Street Bank and Trust Company of Boston,
Massachusetts. Effective July 1, 1995, Fidelity Management
Trust Company of Boston, Massachusetts became trustee and
custodian. The purpose of the Plan is to enable
participants to invest a portion of their salaries in tax
deferred savings as allowed by the Internal Revenue Code.
The Plan is subject to and in compliance with the provisions
of the Employee Retirement Income Security Act of 1974
(ERISA) as amended.
Illinois Power Company is a wholly-owned subsidiary of
Illinova Corporation (Illinova). Although Illinois Power
Company remains the sponsor and administrator of the Plan,
all shares of stock contributed to participants' accounts or
held in the Stock Fund are shares of Illinova.
Participation:
All employees of the Company who are covered under a
collective bargaining agreement are eligible to participate in the
Plan. Participation is voluntary. Active participation
ceases upon termination of employment with the Company.
Former employees can choose to liquidate their accounts or
to leave them in the Plan. Earnings will continue to accrue
on undistributed accounts. All accounts, whether for active
or former employees, are fully vested.
Plan Changes and Amendments:
As of June 30, 1994, the administrator started phasing out
the Guaranteed Investment Contract option. No funds were
contributed or transferred to the GIC after that date.
Funds in the guaranteed investment contract were eligible to
remain there until June 30, 1996, at which time the contract
matured and the remaining funds were transferred to the
Managed Income Portfolio.
Contributions:
Participants may make before-tax contributions by
payroll deduction up to the legal dollar limit. Participants
may also make after-tax contributions in cash or by payroll
deduction. Total contributions are limited to the applicable
percentage limit set by law. A participant may also "roll-
over" into the Plan amounts previously invested in another
retirement plan.
Participants have the option of directing their
contributions into any or all of the investment funds in the
proportions they choose. They may change their direction
options or transfer amounts from fund to fund at any time.
The Company contributes a monthly matching contribution
to the Plan equal to 50% of the first $80 of the
participants' monthly before-tax contributions and 25% of
the balance of deferrals per month, up to 6% of the
employee's base earnings for the month. All Company matching
contributions are paid in units of Illinova common stock and
are contained in the Stock Fund. Dividends on stock held in the
Stock Fund are invested in the Stock Fund and increase the
unit value of the Fund.
The Company has an Incentive Compensation arrangement in
which employees can earn cash and Illinova stock if specified
performance goals are met. Units awarded under the
Incentive Compensation arrangement are held in the Stock
Fund. Dividends earned on these units are invested in the
Stock Fund and increase its unit value.
Shares previously held in the Tax Reduction Act Stock
Ownership Plan (TRASOP), which was eliminated in 1988, are
also held in the Stock Fund.
ESOP:
In October 1990, the Board of Directors authorized
amendments to the Incentive Savings Plan to provide for the
implementation of an Employee Stock Ownership Plan (ESOP)
arrangement. Under this arrangement, the Company, pursuant
to authorization granted by the Illinois Commerce Commission
(ICC), loaned $35 million to the Trustee of the ESOP in
January 1991. The loan proceeds were used to purchase
2,031,445 shares of the Company's common stock on the open
market. These shares are held in the ESOP and are allocated to the
accounts of eligible participating employees as they are
earned through the Match or Incentive Compensation features
of the Plan.
As of December 31, 1996, 235,164 and 323,840 shares have
been allocated to bargaining unit employees for Company Match and
Incentive Compensation, respectively.
Distributions:
Distributions as provided for in the Plan are made to
Plan participants or their beneficiaries no later than 120
days following the close of the Plan year in which the
participant reaches age 70 1/2 unless an earlier distribution
is requested. All distributions are made in the form of
cash and/or Illinova common stock.
Loans:
The Plan allows participants to borrow from their
before-tax and TRASOP accounts an amount not to exceed the
lesser of $50,000 reduced by the excess of the highest
outstanding balance of loans during the one-year period
before the date the loan is made over the outstanding
balance of loans on the date the loan is made or 50% of the
vested account balance. Interest is charged on these loans
at a rate commensurate with interest rates charged by
persons in the business of lending money for similar type
loans. For 1996, the interest rate was 9.25%. The range for
1995 was 9.5% to 10%.
All loans made will mature and be payable in full no earlier
than one year and no later than five years from the date of the
loan. An exception exists when the loan is used by the
participant to acquire their principal residence. In this
case, the loan will mature and be payable in full no earlier
than one year and no later than ten years from the date of
the loan. Loan repayments are made by payroll deductions
authorized by the participant and by optional cash payments.
Interest paid on the loan is credited to the participant's
account. The Trustee maintains a Loan Fund to hold the
balances of participants' loans.
Plan Termination:
It is expected that the Plan will be continued, but the
right to amend, modify or terminate the Plan is reserved by the
Company provided that such action does not retroactively and
adversely affect the rights of any participant or
beneficiary under the Plan.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting:
The accompanying Plan financial statements are prepared on
the accrual basis of accounting.
Investments:
The guaranteed investment fund is valued at contract
value as reported to the Plan by the Trustee. Participant
notes receivable included in the loan fund are valued at
cost, which approximates fair value. Other investments are
stated at current value based on the latest quoted market
price.
Income:
Interest and dividend income is accrued as earned.
Net appreciation (depreciation) of investments is comprised
of realized and unrealized gains and losses. Realized gains or
losses represent the difference between proceeds received upon
sale and the average cost of the investment. Unrealized gain or
loss is the difference between market value and cost of
investments retained in the Plan (at financial statement date).
For the purpose of allocation to participants, the Illinova
common stock is valued by the Plan at actual cost; however,
current value is used at the time of distribution to participants
and results in a realized gain or loss as reflected in the
Statement of Changes in Net Assets Available for Benefits.
Expenses:
Certain expenses incurred in the administration of the
Plan are paid by the Plan rather than the Company. The
expenses paid by the Plan include ESOP record keeping fees
and trustee administrative fees. All other expenses incurred
in the operation of the Plan are paid by the Company.
Income Taxes:
The Plan obtained its latest determination letter on January
8, 1996, in which the Internal Revenue Service stated that the
Plan as designed was in compliance with the applicable
requirements of the Internal Revenue Code.
NOTE 3 - INVESTMENTS
Plan investments are received, invested and held by
the Trustee. Individual investments that represent 5% or
more of the Plan's net assets available for benefits include:
<TABLE>
<C> <C> <C> <C>
December 31, 1996
Investments at Fair
Value as Determined by
Quoted Market Price Units Value Cost
Fidelity Equity Income
Fund 377,172 16,154,296 12,638,120
Fidelity Retirement
Growth Fund 1,061,265 18,349,277 18,759,454
Illinova Common Stock 829,509 22,811,497 18,146,391
Fidelity Managed Income
Portfolio 10,955,488 10,955,488 10,955,488
December 31, 1995
Investments at Fair
Value as Determined by
Quoted Market Price Units Value Cost
Fidelity Equity Income
Fund 335,468 12,724,309 10,445,477
Fidelity Retirement
Growth Fund 937,946 17,061,240 16,468,153
Illinova Common Stock 822,727 24,681,810 17,895,163
Fidelity Managed Income
Portfolio 8,846,229 8,846,229 8,846,229
</TABLE>
NOTE 4 - TRANSACTIONS WITH PARTIES-ININTEREST
Fidelity Management Trust Company, the Trustee for the
Plan, purchased shares of Illinova Common Stock at a cost of
$3,507,783 in 347 transactions and sold shares, the proceeds
of which totaled $4,195,275, in 350 transactions. The net
gain on these sales was $851,886. The transactions are
allowable party-in interest transactions under Section
408(3) of the ERISA regulations.
The majority of the assets of the Plan are invested in
Fidelity Investments mutual funds. The Plan also invests
in a shortterm money market fund, the Fidelity Investments
Cash Portfolio. The transactions with these Fidelity funds
are allowable party-in-interest transactions under Section
408(b)(8) of the ERISA regulations. The number of purchase
transactions with each fund and the dollar amount of
purchases for each fund as of December 31, 1996 are listed
below:
<TABLE>
<C> <C> <C>
Purchase
Fund Transactions Purchase Amount
Equity Income Fund 226 $4,337,805
Retirement Growth Fund 229 5,235,261
International Fund 140 488,376
Asset Manager Fund 174 875,728
Asset Manager Growth Fund 131 818,167
Asset Manager Income Fund 83 139,745
Managed Income Portfolio 193 5,731,576
Cash Portfolio 144 4,293,755
</TABLE>
The number of sales transactions with each fund, the
dollar amount of sales, and the gain on these sales for
each fund as of December 31, 1996 are shown below:
<TABLE>
<C> <C> <C> <C>
Sales
Trans- Sales
Fund actions Amount Gain
Equity Income Fund 193 $2,549,056 $403,894
Retirement Growth Fund 213 3,096,728 152,768
International Fund 99 372,482 12,646
Asset Manager Fund 148 867,069 76,964
Asset Manager Growth Fund 88 432,529 53,298
Asset Manager Income Fund 42 110,883 3,798
Managed Income Portfolio 219 3,622,316 0
Cash Portfolio 277 4,282,326 0
</TABLE>
Schedule I
Item 27a
Illinois Power Company
Incentive Savings Plan
for Employees Covered Under a
Collective Bargaining Agreement
Schedule of Assets Held for Investment Purposes
<TABLE>
<C> <C> <C>
December 31, 1996
Identity of Issue/ Current
Description of Investment Cost Value
*Fidelity Equity Income Fund $12,638,120 $16,154,296
*Fidelity Retirement Growth Fund 18,759,454 18,349,277
*Illinova Common Stock 18,146,391 22,811,497
*Fidelity Asset Manager Income
Fund 291,925 302,753
*Fidelity Asset Manager Growth
Fund 2,134,367 2,397,751
*Fidelity Asset Manager Fund 3,152,208 3,438,571
*Fidelity International Growth
and Income Fund 1,338,528 1,469,320
*Fidelity Managed Income
Portfolio 10,955,488 10,955,488
**Participant Loans 2,805,579 2,805,579
$70,222,060 $78,684,532
*A party-in-interest to the Plan
**Interest rates on loans range
from 7% to 11%
</TABLE>
Schedule II
Item 27d
Illinois Power Company
Incentive Savings Plan
for Employees Covered Under a
Collective Bargaining Agreement
Schedule of Reportable Transactions
for the Year Ended December 31, 1996
<TABLE>
<C> <C> <C> <C> <C>
Net Gain
Identity of Party Involved/ Purchase Selling Cost of or
Description of Asset Price Price Asset (Loss)
Illinova Common Stock 3,507,783 4,195,275 3,343,389 851,886
Fidelity Equity Income
Fund 4,337,805 2,549,056 2,145,162 403,894
Fidelity Retirement
Growth Fund 5,235,261 3,096,728 2,943,960 152,768
Fidelity Managed Income 5,731,576 3,622,316 3,622,316 0
Portfolio
</TABLE>
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, Illinois Power Company has duly
caused this annual report to be signed on its behalf
by the undersigned hereunto duly authorized.
Illinois Power Company
Incentive Savings Plan
for Employees Covered Under a
Collective Bargaining Agreement
by \s\ David W. Butts
________________________
David W. Butts
Senior Vice-President
Date: June 17, 1997
EXHIBIT INDEX
Exhibits Filed Herewith
Exhibit No. Description
1 Consent of Independent Accountants
Exhibit 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Registration Statement on Form S8 (No. 33-60278 of Illinova
Corporation of our report on the Illinois Power Company
Incentive Savings Plan for Employees Covered Under a
Collective Bargaining Agreement for the year ended December
31, 1996, dated June 13, 1997, which is incorporated by
reference in this Form 11-K.
by /s/ Price Waterhouse LLP
St. Louis, Missouri
June 17, 1997
